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Speaker 1: Bloomberg Audio Studios, podcasts, radio news. This is the Bloomberg

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Speaker 1: Surveillance Podcast. Catch us live weekdays at seven am Eastern

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Speaker 1: on Apple car Play or Android Auto with the Bloomberg

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Speaker 1: Business App. Listen on demand wherever you get your podcasts,

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Speaker 1: or watch us live on YouTube.

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Speaker 2: We just don't have a lot of economic data.

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Speaker 3: There's a lot of uncertainty out there in the marketplace

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Speaker 3: as to where this economy is.

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Speaker 2: I don't help.

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Speaker 3: People do it who actually get paid to do this

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Speaker 3: stuff for a living. Like our next guest, Sema Shaw, Chief,

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Speaker 3: a global strategist at Principal Asset Management. Seema, what are

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Speaker 3: you making of the last I don't know, two three

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Speaker 3: weeks seem to be a little market seem to be

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Speaker 3: just a little unsettled here. I mean there's only a

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Speaker 3: three percent draw down and yes, and paid, nothing to

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Speaker 3: really write home about.

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Speaker 2: But you know, what do you make of some of

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Speaker 2: this uncertainty we're seeing the marketplace?

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Speaker 4: Good morning, Nathan.

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Speaker 5: Yeah, absolutely, this has been a really, really rocky and

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Speaker 5: it's been interesting because I think what the shutdown did

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Speaker 5: is just created this vacuum which has allowed some really

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Speaker 5: kind of negative narratives to take route and the key

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Speaker 5: one is that how the FED isn't going to be

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Speaker 5: interpreting the direction of the economy. I think coming into this,

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Speaker 5: to the shutdown, the general consensus was that the doves

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Speaker 5: of the FMC would have the upper hand and almost

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Speaker 5: assuring a December eight cut, And if anything, what's happened

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Speaker 5: is actually the more hawkish members have seemed to become

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Speaker 5: a little bit more dominant, and as a result, we're

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Speaker 5: in this point where now the odds of a FED

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Speaker 5: cut in December is just down to fifty to fifty,

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Speaker 5: and it really is rattling the market, partly because we

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Speaker 5: just don't have a clear narrative, as you said, So.

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Speaker 6: I'm looking at the VIX index, of course, that's Wall

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Speaker 6: Street Sphere engage. I'm seeing it sitting around the twenty

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Speaker 6: two handle. What do you make of the current volatility

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Speaker 6: in the market. Do you expect it to sort of

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Speaker 6: temper out here?

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Speaker 5: I mean, I think it could once we start to

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Speaker 5: get a clearer direction, But again, it really does depend

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Speaker 5: on how the FED is going to respond.

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Speaker 4: I think that's one thing.

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Speaker 5: And then of course there's the AI story, and those

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Speaker 5: fears seem like they're really taking root. We don't want

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Speaker 5: to jump to many conclusions because of course it got

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Speaker 5: the end video earnings report coming, so everything could just

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Speaker 5: completely turn around if that's a good release and start

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Speaker 5: to you know, once again put some of those fears

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Speaker 5: to bed. But at least you know, as we're going

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Speaker 5: into twenty twenty six and we are expecting a bit

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Speaker 5: of an economic slow down, a bit of a labor

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Speaker 5: market slow down, that is typically the time when you

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Speaker 5: start to see some of these fears really start to

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Speaker 5: take route, particularly when you consider it from a late

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Speaker 5: cycle narrative.

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Speaker 3: S we're just in the process of finishing up this

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Speaker 3: third quarter earnings release and buying large earnings were really

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Speaker 3: pretty solid double digit, low double digit kind of growth rate.

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Speaker 3: There is that enough to support this market?

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Speaker 4: Sea it should be.

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Speaker 5: I mean, typically you just need to have like positive

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Speaker 5: economic growth driving positive earnings growth, and ultimately the S

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Speaker 5: and P five hundred for example, is very very tightly

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Speaker 5: correlated with our earnings performance, so it should do.

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Speaker 7: Now.

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Speaker 5: Of course, there's going to be some bumps along the road,

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Speaker 5: and when you look at valuations, particularly for those big

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Speaker 5: tech companies, there's going to be moments, potholes, air pockets,

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Speaker 5: whatever you want to call it where the market really

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Speaker 5: does have that moment of a hesitation where they.

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Speaker 4: Really start to question the direction.

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Speaker 5: But the key thing for us is, look as long

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Speaker 5: as you can continue with positive growth in twenty twenty six,

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Speaker 5: maybe a little bit lower than what we've enjoyed in

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Speaker 5: twenty twenty five on the whole, but as long as

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Speaker 5: there's positive growth, and really you should see this continuation

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Speaker 5: of ardness growth and that should be enough to support

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Speaker 5: the act market. We're not, of course, expecting very significant

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Speaker 5: gains through next year, but at least you know in

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Speaker 5: a upper trajectory where it does become important where you're

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Speaker 5: going to be positioned.

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Speaker 4: Which are the companies, which are the sectors?

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Speaker 6: So you mentioned you flicked at the idea. There's a

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Speaker 6: lot of fear surrounding AI. We've been hearing so much

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Speaker 6: talk about market valuations being too high. So where do

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Speaker 6: you want to be in this market?

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Speaker 5: So we do have overweight to that megacab trade like

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Speaker 5: everyone else is in the market. Has been really important

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Speaker 5: to start doing well, to continue the analysis of these

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Speaker 5: companies and looking at valuations now that valuations are frothy.

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Speaker 5: That goes without saying, but I think the comparison to

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Speaker 5: the dot com bubble is very much exaggerated. We have

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Speaker 5: been very much reassured by the fact that the balance

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Speaker 5: sheets of these companies are very strong, But there are

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Speaker 5: concerns and the concerns that we need to track. One

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Speaker 5: thing which is driving which I don't think is going

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Speaker 5: to be answered at anytime soon, of course, is how

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Speaker 5: it's going to be delivering on all of that productivity

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Speaker 5: potential that people are hoping for, and that simply will

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Speaker 5: not be answered anytime soon. So then the key thing

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Speaker 5: that we have to be keeping a track of is

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Speaker 5: how they're financing all of their AI capics. Is this

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Speaker 5: debt financing becoming more of a trend in which case

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Speaker 5: concerns around the bubble are going to increase if it's

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Speaker 5: not matched by profit growth.

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Speaker 4: So I think we're at the.

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Speaker 5: Early innings of some of these concerns, which, unfortunate doesn't

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Speaker 5: mean it's going to grow. But as long as these

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Speaker 5: companies can continue to deliver on the earning side, we

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Speaker 5: do think it can you know, dispel those fizz as

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Speaker 5: they continue to grow. So it's an opportrajectory, but very

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Speaker 5: very noisy.

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Speaker 3: Sea Michhaw, Thank you so much. We always appreciate getting

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Speaker 3: a few innutes your time, Semashaw. She's a chief global

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Speaker 3: strategist principal asset Management located over there in the city

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Speaker 3: of London.

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Speaker 2: Appreciate that. Stay with us. More from Bloomberg Surveillance coming

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Speaker 2: up after this.

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Speaker 1: You're listening to the Bloomberg Surveillance podcast. Catch us live

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Speaker 1: weekday afternoons from seven to ten am Eastern Listen on

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Speaker 1: Applecarplay and Android Auto with the Bloomberg Business app, or

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Speaker 1: watch us live on YouTube.

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Speaker 2: I'll switch gears to commodities.

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Speaker 3: A lot going on out there in the space here,

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Speaker 3: I don't know. I'm getting ready for the next season

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Speaker 3: of Landman, which means I focus on oil, and I

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Speaker 3: see wtacrud to oil below sixty dollars. I like that

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Speaker 3: as a consumer, but I know the folks in the

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Speaker 3: patch don't have they like seventy five dollars.

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Speaker 2: Of course, you know the cost of productions.

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Speaker 3: In a mid fifties, so they're making some good scratch there,

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Speaker 3: but it's down here at sixty.

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Speaker 2: They're not so happy. You've got somebody who does this

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Speaker 2: stuff for a living.

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Speaker 3: Francisco Blunch, head of Global Commodities at Bank of America Securities.

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Speaker 3: I know them as Merrill Lynch back in the day,

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Speaker 3: but they can call themselves whatever they want these days. Francisco,

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Speaker 3: thanks so much for joining us here in our Bloomberg

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Speaker 3: and Director Brokers studio. On the commodities front, what do

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Speaker 3: your clients want to talk to you about these days?

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Speaker 8: They want to talk about going through all oil, They

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Speaker 8: want to talk about gold yep, they want to talk

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Speaker 8: about what's going on in the metal space, some of

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Speaker 8: the tire if impact on agriculture, and they I think

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Speaker 8: they also want to talk about power and AI.

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Speaker 3: All right, let's let's go with the power in the

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Speaker 3: AI story, because that's kind of a new thing.

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Speaker 9: You know.

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Speaker 3: AI has been such a theme for this marketplace, certainly

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Speaker 3: for the tech stocks that have direct exposure, and then

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Speaker 3: people started looking for a derivative places and they come

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Speaker 3: to your world, which is, how are we going to

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Speaker 3: power all this stuff? How does that impact kind of

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Speaker 3: the commodity discussion in terms of power?

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Speaker 10: So the biggest impact, the most direct impact, has been

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Speaker 10: perhaps in the metals markets, which are kind of the

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Speaker 10: pick and shovels of health. Christy, we you've seen that

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Speaker 10: in the price of copper you've seen the price of silver,

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Speaker 10: and we expected to continue or the course of the

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Speaker 10: next twelve to eighteen months. So we are bullish on

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Speaker 10: those two commodities. Just to be clear, we have a

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Speaker 10: fifteen thousand dollar per ton copper target over the next

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Speaker 10: twenty four months, and we have and we have over

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Speaker 10: the next twelve months or so. We got a sixty

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Speaker 10: five dollar announced silver target. So we're bullishing those two commodities.

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Speaker 10: Their key the best and the second best electricity conductors

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Speaker 10: in the world as a commodity, so we think those

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Speaker 10: two make makes sense. Strong exposure to or panels to grid. Also,

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Speaker 10: people want to talk about gas and how gas powers electricity.

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Speaker 10: In the US, we've seen a big rump up in

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Speaker 10: Henry Hog prices. You may have noticed that we are

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Speaker 10: now trading around four and a half low or cinemmb

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Speaker 10: to you, that's a pretty big pickup. And remember gas

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Speaker 10: is in the US been hit by two things. First,

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Speaker 10: demand for power has been very strong, although that's not

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Speaker 10: really the reason why gas prices have risen. It's because

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Speaker 10: of the LNG export story to power the rest of

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Speaker 10: the world, and of course the US launched a large

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Speaker 10: investment into LERNG export facilities, liquid natural gas export facilities.

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Speaker 10: These are coming online very quickly. They are soaking up

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Speaker 10: all that gas, freezing it and shipping it to Europe

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Speaker 10: and to other parts of the world. And that's been

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Speaker 10: the true story for the last few months and will

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Speaker 10: remain the big story for the next few months. So

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Speaker 10: we're not I mean, we're not super bowlish, in part

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Speaker 10: because we think producers are very good at.

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Speaker 11: Cranking out output.

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Speaker 10: So you talked about oil and how folks need higher

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Speaker 10: price than sixty dollars a barrel to get a decent return,

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Speaker 10: but for gas, the number is a lot lower than

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Speaker 10: four and a half our MBTUS.

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Speaker 11: So we're going to see a ramp up there in activity.

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Speaker 3: So you're the expert in commodities, but I have the

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Speaker 3: g lco go function on the Bloomberg termat Global Commodities,

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Speaker 3: so I can see everything, and I can at a

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Speaker 3: copto party, I can sell.

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Speaker 9: It an expert.

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Speaker 6: Honestly, I wanted to stick with that AI play that

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Speaker 6: we were talking at a bit earlier. What are some

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Speaker 6: other maybe derivative plays that you think maybe investors are

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Speaker 6: underappreciating during this time period.

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Speaker 11: So we we like in the commodity world.

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Speaker 10: You can also look at power prices themselves, and we

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Speaker 10: think those power prices are likely to need to go up.

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Speaker 10: Wholesale power prices, we've seen pasty auctions very strong and

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Speaker 10: across pretty in PGM, and in the northeast there's a

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Speaker 10: huge data center build out as you know going on

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Speaker 10: in Virginia. It's having uploided complication as well. Right, we've

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Speaker 10: seen the cost of living remaining a core issue in elections,

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Speaker 10: and we expected to remain so because it's you know,

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Speaker 10: we don't really see the pressures fading away. But one

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Speaker 10: derivative side of power right is perhaps the most the

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Speaker 10: most underappreciated, is aluminium. Aluminum is essentially solid electricity. When

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Speaker 10: you have a lot spare electricity, you basically can make

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Speaker 10: very cheap aluminum because it takes fourteen megal hours of

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Speaker 10: power to make a ton of aluminum. So we expect

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Speaker 10: aluminum prices to also write rise quite significantly. And it's

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Speaker 10: interesting because aluminium is one of the komaries that has

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Speaker 10: been subject to a fifty percent diarrey, even though it's

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Speaker 10: really a Canadian import, So we expect aluminum prices to

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Speaker 10: trend higher globally.

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Speaker 11: That's one area.

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Speaker 10: We think as a result of the AI boom, and

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Speaker 10: it's essentially solid electricity.

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Speaker 3: Looking at WTIQ to oil roughly sixty dollars a barrel

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Speaker 3: of brent sixty four?

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Speaker 2: Is there an oil glut out?

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Speaker 11: There were in a period of.

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Speaker 2: Prolonged oversupply and crew do you think we are?

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Speaker 10: And that's the You know, it's interesting because we talked

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Speaker 10: about all this energy demand and here we are with

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Speaker 10: really pressed Cruler prices.

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Speaker 11: So what's going on? Simply we have we have a

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Speaker 11: price war.

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Speaker 10: Right now between OPEC plus and rest of the world.

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Speaker 10: For the last three years, in twenty two, twenty three,

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Speaker 10: twenty four, price of oil average almost ninety dollars a

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Speaker 10: barrel and Brent and mid eighties for WTI. But you

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Speaker 10: know what, US production went up three million barrels a day.

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Speaker 10: Saudi production went down two million barrels a day. They

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Speaker 10: cannot keep doing this forever. And they're like, well, you know,

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Speaker 10: nineteel oil doesn't really work for us. It works too

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Speaker 10: well for you, but it doesn't really work for us

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Speaker 10: at all. So we got to get some of that

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Speaker 10: market share back. And that's what's going on. They've been

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Speaker 10: adding a lot of barrels, and that's the press prices.

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Speaker 10: We've averaged about sixty nine dollars a barrel in brand

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Speaker 10: this year, about four sunder.

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Speaker 11: From t I sixty five. Last year we averaged around eighty.

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Speaker 10: Right, So it's it's and honestly like there is like

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Speaker 10: a lot and and OPEK ten days ago decided to

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Speaker 10: pause and partly because they thought, well, maybe there's too

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Speaker 10: much money in the market. We're going to the first quarter,

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Speaker 10: which is seasonally weak, so let's put a pulse on

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Speaker 10: things here because OPEC doesn't want to run a price

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Speaker 10: war like.

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Speaker 11: Like twenty twenty or twenty fifteen. Right, you're based in

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Speaker 11: Madrid right now?

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Speaker 2: Yah, Okay, here's the problem I have with the Madrid

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Speaker 2: maybe Spain in general. Tell us I'm an early to bed,

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Speaker 2: early to rhymes kind of guy.

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Speaker 3: These people don't go out to dinner till like nine

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Speaker 3: ten o'clock at night.

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Speaker 2: What is that? What is up with that?

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Speaker 9: All right?

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Speaker 11: So, so just a quick historical five.

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Speaker 10: About one hundred years ago, maybe ninety years ago, Spain

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Speaker 10: changed the time zone to align it with with Prism Berlin. Okay,

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Speaker 10: really so, so Spain has a time zone which is

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Speaker 10: aligned with really I mean today, if you go to

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Speaker 10: Warsaw at the same time zone as Madrid, that doesn't

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Speaker 10: make any sense because you go to the Grewch meridian

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Speaker 10: and it crosses straight through Valencia.

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Speaker 2: Okay, so the whole of.

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Speaker 11: Spain should be on UK time zone, not on German

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Speaker 11: time zone.

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Speaker 10: But that's kind of something happened ninety years ago and

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Speaker 10: nobody seems to have been willing to change it. There's

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Speaker 10: a big debate in the country as to whether that

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Speaker 10: makes any sense.

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Speaker 11: Should we change that? Well, people love.

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Speaker 10: Going out I move. It's also pretty horrific. You wake

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Speaker 10: up sometimes eight in the morning, eight to fifteen's the lark.

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Speaker 2: Oh my goodness, it is phenomenal. City loves that must be.

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Speaker 2: It is awesome. Francisco, thank you so.

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Speaker 11: Much for joining us.

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Speaker 2: We appreciate our Francisco.

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Speaker 3: Blanchi's head of Global Commodities at Bank of America's Securities

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Speaker 3: based in Madrid, but journey us live here in our

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Speaker 3: Bloomberg Interactive Broker.

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Speaker 2: Studio, and we appreciate that. Stay with us. More from

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Speaker 2: Bloomberg Surveillance coming up after this.

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Speaker 1: You're listening to the Bloomberg Surveillance podcast. Catch us Live

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Speaker 1: weekday afternoons from seven to ten am Eastern Listen on

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Speaker 1: Apple Karplay and Android Auto with the Bloomberg Business app,

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Speaker 1: or watch us live on YouTube.

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Speaker 3: Hassam Naji joins us. He's the CEO of Marcus and Milichip.

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Speaker 3: That's the business that he does, retail, commercial, all that

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Speaker 3: kind of stuff. He joins us here in studio, Hassan,

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Speaker 3: talk to us about the country here in retail, commercial,

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Speaker 3: real estate.

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Speaker 2: What's the market look like?

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Speaker 9: Good morning, Great to be with you again.

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Speaker 7: Retail has a short term and a long term picture

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Speaker 7: that we have to talk about in order to really

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Speaker 7: express the current state of the market. The long term

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Speaker 7: picture comes from pain twenty years of reinvention of retail commerce,

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Speaker 7: killing brick and mortar, and the industry stopped building any

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Speaker 7: new product for the most part, and reposition so many

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Speaker 7: shopping centers and retail concepts.

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Speaker 9: And we've come.

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Speaker 7: Out of that much tighter and a reinvented way of

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Speaker 7: using brick and mortar retail, which is now being very successful.

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Speaker 7: It's all pretty much driven by fitness, entertainment, food, and

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Speaker 7: destination shopping. Those things are moving in a very positive

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Speaker 7: direction in the near term because wages have been growing

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Speaker 7: and consumer confidence has been really high and high net

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Speaker 7: worth individuals have been spending thanks to the stock market

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Speaker 7: and other wealth creation mechanisms. Sales have been really, really strong,

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Speaker 7: So two very short term and long term positive factors going.

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Speaker 7: Some of the headwinds are the uncertainty related to interest

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Speaker 7: rates tariffs that made many retailers pause for a moment

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Speaker 7: in store openings, and balancing forecasting where consumer confidence may

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Speaker 7: be going, which has weakened in the last few months.

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Speaker 7: So it's really a battle between some of that uncertainty

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Speaker 7: and very strong fundamentals.

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Speaker 4: So during the.

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Speaker 6: Break, you were talking to us about how some of

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Speaker 6: the retail spaces are performing well in suburban areas.

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Speaker 4: Talk to us a bit about what are those.

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Speaker 6: Like regionally as we think about demand for retail space.

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Speaker 7: You mentioned New York right here at the heart of

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Speaker 7: the capital markets, at center of the world. We're creating

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Speaker 7: seventy to eighty thousand jobs a year. New York is back.

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Speaker 7: Yet there is a lot of urban retail storefronts that

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Speaker 7: are still empty or struggling.

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Speaker 9: The consumer habits, the you know.

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Speaker 7: Tourism hit that we took earlier this year, all those

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Speaker 7: things play into street urban retail Suburban retail, on the

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Speaker 7: other hand, has been doing much much better. And I

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Speaker 7: would say urban retail is on the recovery, but not

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Speaker 7: quite quite as strongly because the post pandemic effect of

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Speaker 7: a lot of people flaying urban markets. That's changing, thank god,

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Speaker 7: because of the mandate to return to office, which is

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Speaker 7: also helping to improve both residential and retail.

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Speaker 3: You know now that I think about our Lectionington Avenue

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Speaker 3: fifty eight fifty night, I mean, whoever owns those building

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Speaker 3: and manages those buildings, they're doing a bad job.

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Speaker 4: I think I could sell that. I could sell that stuff.

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Speaker 3: I mean it's prime location, it's people are back, it's packed.

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Speaker 4: So I think so I don't get all.

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Speaker 7: You just hit the most important part of creating wealth

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Speaker 7: through commercial real estate, and that is what are you

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Speaker 7: going to do with the asset?

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Speaker 9: Why did you buy it in the first place, how

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Speaker 9: did you.

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Speaker 7: Finance it, What was the value in and your expected

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Speaker 7: value out and in between? What are you going to

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Speaker 7: do to create value and make the property stand out.

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Speaker 7: At the end of the day, it's just a business

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Speaker 7: execution of that strategy, asset by asset.

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Speaker 3: Yeah, they got the signs in the Windo. I'm going

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Speaker 3: to call that number and sit, give them a marine poll.

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Speaker 2: Get going here, all right? Interest rates are coming down,

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Speaker 2: and that's good for your business? How good for your business?

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Speaker 7: Really fascinating to see what's happened with commercial reals did

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Speaker 7: as a whole. We have three very positive forces working

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Speaker 7: for the industry. One is price corrections. Since twenty twenty

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Speaker 7: two peak March of that year, prices have cone down

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Speaker 7: on average fifteen to twenty percent across the entire industry.

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Speaker 9: Interest rates are coming down.

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Speaker 7: As a second positive, and more important than that, is

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Speaker 7: the fact that financing is back. Banks are lending again,

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Speaker 7: credit unions are lending again. And that doesn't capture much

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Speaker 7: headlines because more than eighty percent of all transactions in

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Speaker 7: commercial real estate are sub ten million dollars executed by

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Speaker 7: high net worth individuals and high net worth households, not institutions,

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Speaker 7: And so when debt becomes more available and lenders are

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Speaker 7: more confident, the lender spreads come in, and that's why

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Speaker 7: interest rates are coming down.

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Speaker 9: The only real headwind we have is.

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Speaker 7: This uncertainty around the government shutdown and the data that

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Speaker 7: the federalies on and all the question marks about the

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Speaker 7: effect of tariffs on inflation and what the Fed will

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Speaker 7: or will not do. That's pretty much the only real

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Speaker 7: headwind we're facing. Fundamentals look really great.

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Speaker 6: So in my previous role, before I became markets correspondent

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Speaker 6: for Bloomberg Television, I was on our equities team.

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Speaker 1: Oh thanks, Paul.

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Speaker 6: I was on our equities team, and I covered real

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Speaker 6: estate's box. I covered reads in particular, and I was

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Speaker 6: surprised to learn that office reads only make up about

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Speaker 6: less than four percent of reachs. More and broadly. So

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Speaker 6: a lot of people look at commercial real estate is bad, bad,

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Speaker 6: bad because of struggles in office. But it's really confleating

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Speaker 6: that idea and really making it brought it out for

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Speaker 6: the broader sector. But what other areas are you keeping

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Speaker 6: an eye on? I know I used to senior housing

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Speaker 6: a lot. Is that an area that you're looking at as

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Speaker 6: we think about the baby boomers.

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Speaker 7: Absolutely, we do business in sixteen sub categories of commercial

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Speaker 7: real estate, self storage, manufactured homes, land, of course, medical office.

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Speaker 9: We cover all those property types.

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Speaker 7: And even within retail there is a huge divergence of

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Speaker 7: shopping centers versus fast foods, single tenant or auto part

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Speaker 7: single tenant properties. All of those different sub sectors have

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Speaker 7: their own cycles and within office.

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Speaker 9: It's interesting you say that.

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Speaker 7: Because during the banking crisis of twenty twenty three, there

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Speaker 7: was so much concern that commercial real estate was the

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Speaker 7: next shoe to drop and put pressure on the banking system.

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Speaker 7: And when you look at the total outstanding loans held

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Speaker 7: by US banks, there's less than a five percent total

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Speaker 7: exposure through office. And not every office building is distressed,

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Speaker 7: I mean by far. In fact, suburban office vacancies have

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Speaker 7: been running around eleven percent.

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Speaker 9: It's the urban.

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Speaker 7: Older assets that have thirty percent vacancy rates. So there

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Speaker 7: was a lot of misperception about the impact of the

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Speaker 7: whole post pandemic office issue.

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Speaker 2: Private credit, to what extent is up is it playing

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Speaker 2: a role in your business.

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Speaker 7: It played a very significant role in twenty one and

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Speaker 7: twenty two when debt funds were issuing loans at very

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Speaker 7: aggressive underwriting and very unrealistic rent growth assumptions. Those loans

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Speaker 7: are turning out and there isn't as much private credit

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Speaker 7: to absorb all of those So some of those assets

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Speaker 7: they're having issues and are distressed.

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Speaker 3: All right, Naji, thank you so much for joining us.

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Speaker 3: Some Naji, he's the CEO Marcus and Milchap joining us

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Speaker 3: live here in our a Bloomberg Interactive Brokers studio in

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Speaker 3: New York City.

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Speaker 2: Stay with us. More from Bloomberg Surveillance coming.

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Speaker 9: Up this.

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Speaker 1: You're listening to the Bloomberg Surveillance Podcast. Catch us live

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00:21:09,840 --> 00:21:13,000
Speaker 1: weekday afternoons from seven to ten am Eastern Listen on

439
00:21:13,080 --> 00:21:16,760
Speaker 1: Applecarplay and Android Auto with the Bloomberg Business app, or

440
00:21:16,880 --> 00:21:18,480
Speaker 1: watch us live on YouTube.

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Speaker 2: The highlight of every Bloomberg Surveillance program is the newspapers.

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Speaker 2: Lisa MANTEYA, what do you got for us?

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Speaker 4: All right, We're going to go up there, La.

444
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Speaker 12: This whole the fight for Warner Brother's Discovery, right, it

445
00:21:28,560 --> 00:21:30,800
Speaker 12: has a deadline nearing. So this is in the Wall

446
00:21:30,800 --> 00:21:34,160
Speaker 12: Street Journal. Their sources are telling them Paramount, Comcast, Netflix,

447
00:21:34,200 --> 00:21:37,080
Speaker 12: they're preparing bids for an initial cutoff to submit non

448
00:21:37,119 --> 00:21:41,640
Speaker 12: binding first round bids by November twentieth. They say, Warner

449
00:21:41,640 --> 00:21:43,560
Speaker 12: Brothers Discovery hopes to have it wrapped up by the

450
00:21:43,640 --> 00:21:45,520
Speaker 12: end of the year. And then you go to this

451
00:21:46,119 --> 00:21:49,119
Speaker 12: article from Bloomberg on the terminal. It says Warner Brother's

452
00:21:49,119 --> 00:21:50,840
Speaker 12: Discovery then.

453
00:21:50,760 --> 00:21:53,240
Speaker 4: Did the contract of CEO David.

454
00:21:53,040 --> 00:21:56,360
Speaker 12: Zavlov to make sure that his stop options remain eligible

455
00:21:56,400 --> 00:21:58,600
Speaker 12: to vest even if the media company is sold.

456
00:21:58,400 --> 00:22:03,159
Speaker 2: So Zazo always gets paid. He there is, Ye're out.

457
00:22:03,240 --> 00:22:05,840
Speaker 3: He is usually the highest paid media executive, and not

458
00:22:06,000 --> 00:22:08,800
Speaker 3: just the function of the the way they do their

459
00:22:08,800 --> 00:22:11,520
Speaker 3: stock compensation. But good for him. Here's the problem I

460
00:22:11,600 --> 00:22:13,440
Speaker 3: have with this deal. Okay, I've called all my banker

461
00:22:13,480 --> 00:22:16,760
Speaker 3: buddies on the street. Nobody's talking to me because they're

462
00:22:16,800 --> 00:22:19,240
Speaker 3: all hired by somebody one of these parties.

463
00:22:19,320 --> 00:22:20,600
Speaker 4: That's when everybody's engaged.

464
00:22:20,760 --> 00:22:23,600
Speaker 2: Everybody's engaged and nobody can talk. So like many conflict,

465
00:22:23,600 --> 00:22:24,119
Speaker 2: I can't talk to.

466
00:22:24,119 --> 00:22:26,120
Speaker 3: You, Sweeney, because you know we got a deal going.

467
00:22:26,200 --> 00:22:28,560
Speaker 3: So but I guess something will happen sooner, right Lisa.

468
00:22:28,400 --> 00:22:30,720
Speaker 12: I hope so. I mean, aside from the stock options,

469
00:22:30,720 --> 00:22:33,959
Speaker 12: you know, remaining eligibles, he they're also saying that his

470
00:22:34,040 --> 00:22:39,120
Speaker 12: employment term would extend to December twenty thirty under certain conditions,

471
00:22:39,160 --> 00:22:42,440
Speaker 12: and his agreement ran through twenty twenty seven, so he's

472
00:22:42,480 --> 00:22:42,880
Speaker 12: taking care.

473
00:22:43,000 --> 00:22:45,199
Speaker 2: So I think we can all feel better that the

474
00:22:45,240 --> 00:22:45,840
Speaker 2: CEO's table.

475
00:22:46,080 --> 00:22:49,480
Speaker 12: What's interesting too, is that so Paramount just wants, you know,

476
00:22:49,600 --> 00:22:51,800
Speaker 12: the whole company, but then you have different ones like

477
00:22:52,480 --> 00:22:55,480
Speaker 12: what you know, other companies like are just looking for

478
00:22:55,560 --> 00:22:57,000
Speaker 12: the concast side.

479
00:22:57,080 --> 00:23:01,959
Speaker 3: Yeah, because the cable network business, which was the jewel

480
00:23:02,080 --> 00:23:06,080
Speaker 3: of Time Warner back in the day. Think about the

481
00:23:06,080 --> 00:23:09,840
Speaker 3: turner all the turner networks, TNTTNN, CNN, all that kind

482
00:23:09,840 --> 00:23:12,800
Speaker 3: of stuff. Those businesses which were the gym, which were

483
00:23:12,800 --> 00:23:15,720
Speaker 3: the profit drivers, which were housed most of the value.

484
00:23:16,000 --> 00:23:18,119
Speaker 3: They are in a secular decline due to cord cutting.

485
00:23:18,320 --> 00:23:19,960
Speaker 3: So a lot of people just don't want that business

486
00:23:20,000 --> 00:23:20,760
Speaker 3: these days.

487
00:23:20,760 --> 00:23:21,840
Speaker 2: All right, what else we got?

488
00:23:21,880 --> 00:23:23,639
Speaker 12: Okay, you were actually just talking about this in a

489
00:23:23,640 --> 00:23:26,080
Speaker 12: previous segment. Were the tough news for the class of

490
00:23:26,080 --> 00:23:29,119
Speaker 12: twenty twenty six. They're six months out from graduation and

491
00:23:29,160 --> 00:23:31,399
Speaker 12: now it doesn't look so great as they look for

492
00:23:31,400 --> 00:23:32,040
Speaker 12: a job.

493
00:23:32,400 --> 00:23:33,280
Speaker 2: There's this new poll.

494
00:23:33,280 --> 00:23:36,000
Speaker 12: It's from the National Association of Colleges and Employers, and

495
00:23:36,080 --> 00:23:38,560
Speaker 12: it shows that more than half of the one hundred

496
00:23:38,560 --> 00:23:40,960
Speaker 12: and eighty three employers surveyed they rate the job market

497
00:23:41,000 --> 00:23:44,679
Speaker 12: for that class as poor or fair. Of course, the

498
00:23:44,720 --> 00:23:49,520
Speaker 12: economic outlook right, they're hiring more conservatively, AI. You've talked

499
00:23:49,520 --> 00:23:51,760
Speaker 12: about it, you know, and that it's taking over more

500
00:23:51,880 --> 00:23:55,000
Speaker 12: tasks that usually these kids are tapped to do like

501
00:23:55,000 --> 00:23:58,720
Speaker 12: those entry level positions. A lot of companies giving priority

502
00:23:58,720 --> 00:24:01,720
Speaker 12: to recruits with some experience as set of the fresh

503
00:24:01,720 --> 00:24:04,880
Speaker 12: from college ones. So now you have these college seniors

504
00:24:04,880 --> 00:24:07,440
Speaker 12: who are competing against junior workers who've been laid off,

505
00:24:07,640 --> 00:24:09,840
Speaker 12: you know. So it's this whole circle that they're kind

506
00:24:09,840 --> 00:24:10,320
Speaker 12: of dealing.

507
00:24:10,160 --> 00:24:11,360
Speaker 2: With a tough market right now.

508
00:24:11,359 --> 00:24:13,439
Speaker 6: I feel like it's so competitive to your point, imagine

509
00:24:13,480 --> 00:24:15,159
Speaker 6: coming out of college that you're competing with people who

510
00:24:15,240 --> 00:24:18,399
Speaker 6: already had experience, correct and we're recently laid off. So

511
00:24:19,040 --> 00:24:20,720
Speaker 6: it's really hard right now for them.

512
00:24:20,920 --> 00:24:22,640
Speaker 2: There you go, all right, all right, this last.

513
00:24:22,400 --> 00:24:25,200
Speaker 4: One, yes, okay, Miss Universe. Okay.

514
00:24:25,240 --> 00:24:28,240
Speaker 12: So there's a battle brewing over this whole pageant. It's

515
00:24:28,280 --> 00:24:30,840
Speaker 12: not a cat fight between the contestants, okay, okay, it's.

516
00:24:30,720 --> 00:24:33,159
Speaker 4: A fight between the two men that are running it.

517
00:24:33,520 --> 00:24:36,359
Speaker 12: So on one side, you have this Mexican businessman, right

518
00:24:36,400 --> 00:24:38,560
Speaker 12: he's the president of the Miss Universe organization. Then on

519
00:24:38,560 --> 00:24:41,479
Speaker 12: the other side you have this Thai entrepreneur. He owns

520
00:24:41,480 --> 00:24:44,320
Speaker 12: a franchise in Thailand. That's what hosted this year's competition.

521
00:24:44,680 --> 00:24:47,600
Speaker 12: So the issue is that you know, pageants are facing

522
00:24:47,920 --> 00:24:49,480
Speaker 12: you know, they're trying to stay relevant. Right, it's the

523
00:24:49,520 --> 00:24:51,840
Speaker 12: age of algorithms. They're trying to do what they can.

524
00:24:52,080 --> 00:24:54,680
Speaker 12: So the Thaie entrepreneur, he wants to transform it into

525
00:24:54,720 --> 00:24:58,199
Speaker 12: like influencer driven and you know they're pushing products. You know,

526
00:24:58,680 --> 00:25:01,080
Speaker 12: I want to try and make money that way. But

527
00:25:01,160 --> 00:25:03,440
Speaker 12: the Mexican businessman saying, you know what, I don't want

528
00:25:03,440 --> 00:25:05,480
Speaker 12: to do it. I wanted to remain like this empowerment

529
00:25:05,520 --> 00:25:08,440
Speaker 12: platform for women. So it's this battle back and forth,

530
00:25:08,440 --> 00:25:11,120
Speaker 12: and it got so heated that you had to tie

531
00:25:11,320 --> 00:25:16,760
Speaker 12: entrepreneur fighting with miss Miss Mexico Miss Universe Mexico. It

532
00:25:16,840 --> 00:25:19,960
Speaker 12: went online like it went viral. It's this hole behind

533
00:25:20,000 --> 00:25:23,560
Speaker 12: the scene thing, contestant storming off. So yeah, it's becoming

534
00:25:23,600 --> 00:25:24,600
Speaker 12: like the drama.

535
00:25:25,040 --> 00:25:27,040
Speaker 2: Well attention might pay attention to.

536
00:25:27,080 --> 00:25:30,560
Speaker 3: It still a thing. Beauty pageants are still big in

537
00:25:30,720 --> 00:25:33,359
Speaker 3: Latin America. I read in this article, so we'll go

538
00:25:33,359 --> 00:25:34,320
Speaker 3: figure least.

539
00:25:34,200 --> 00:25:34,520
Speaker 2: Men to tell you.

540
00:25:34,680 --> 00:25:37,520
Speaker 3: Newspapers thank you so much. We appreciate that the highlight

541
00:25:38,040 --> 00:25:38,680
Speaker 3: every day.

542
00:25:39,000 --> 00:25:40,760
Speaker 2: We kind of spend it the newspaper business.

543
00:25:40,760 --> 00:25:41,000
Speaker 11: Here.

544
00:25:41,040 --> 00:25:45,800
Speaker 1: This is the Bloomberg Surveillance podcast, available on Apple, Spotify,

545
00:25:45,920 --> 00:25:49,720
Speaker 1: and anywhere else you get your podcasts. Listen live each

546
00:25:49,760 --> 00:25:53,600
Speaker 1: weekday seven to ten am Easter and on Bloomberg dot Com,

547
00:25:53,720 --> 00:25:57,520
Speaker 1: the iHeartRadio app tune In, and the Bloomberg Business app.

548
00:25:57,840 --> 00:26:00,439
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549
00:26:00,480 --> 00:26:03,240
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