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Speaker 1: Bloomberg Audio Studios, podcasts, radio news. This is the Bloomberg Surveillance Podcast. Catch us live weekdays at seven am Eastern on Apple CarPlay or Android Auto with the Bloomberg Business app. Listen on demand wherever you get your podcasts, or watch us live on YouTube.

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Speaker 2: People were like, who is Claudius Sam? Like who is she? Who is that one? Dennison University was some time in Dresden and then the clouds parted? What was it like Claudia Sam in two thousand and one to walk into the inflation and nalysh Combine at Michigan of Shapiro and Kimball. They were at the top of their game at that time, weren't they.

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Speaker 3: It was really great to be a student at Michigan. It was great to have Matthews my advisor. Miles was on my committee. That really was a great education in macro and for academics. They're really interested in the real world exactly, micro policies exactly.

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Speaker 2: You knew right where I wanted to go. These were real world academics trying to study real world people off this jobs report. You say, the newly minted chairman way different than Claudia Sam needs to listen to normal people discuss.

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Speaker 4: Right well.

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Speaker 3: Also part of my education at Michigan, even doing macro, was you know, if the data aren't there, you need go collect some data, run surveys, design survey. I mean that's a big part of my education and my research. And I think one thing that the FED has is just a wealth of qualitative data talking to business leaders, talking to people workers, and putting together in terms of analysis. We spend a lot of times on the arrogant numbers. We're going to do that here in just a few minutes, and it is super important, but those kind of more qualitative, the structured interviews, it can help you get a sense of the mechanisms, a sense of what's you know how happening beneath the numbers, and you know these that voice that those voices are missing on the task forces. There's no FED lessons like less framework reviews, and but the information is there. So my Bloomberg opinion piece this week kind of showcased a lot of that kind of data the FED does collect and also showed how it can really help inform what are we thinking about the economy.

00:02:20
Speaker 5: Claudia, we have perils In three minutes from now. But you know, I just have to bring this up. You highlighted the Fed's worker Perspective report, as you know, workers describing their work lives at survival rather than stable. You know, So does that mean that today's report is a nothing burger and we should be looking through the next week's inflation plant?

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Speaker 4: I mean, is that kind of what matters most?

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Speaker 6: Here?

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Speaker 3: To the data we get today are important. Whatever they tell us, there's going to be some lessons for us. The thing that I was really trying to draw out with the worker perspective is we're going to talk a lot about you know, the labor market looks pretty stable or it's balanced, and I think with the aggregate data we might get some surprises. But in general that's been a good description of it. But stable doesn't always feel good in a lived experience because stable can mean yeah, you got a job, you're thankful for that, but you need a better job out there right now.

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Speaker 2: So what Damien brought up in what you're mentioning right now, I can't emphasize enough, folks. That's what my touch with people is, emails, anecdotes, people in restaurants. There's a whole part of America out there struggling Claudia paycheck to paycheck? Does the FED know that?

00:03:25
Speaker 3: I think the reserve bank presidents are a lot more in touch with this very much. A part of their day job is out in their districts, and the community development function out in the reserve banks is really strong. They're the ones that collect the Beige Book. They do a lot. Now network is being done at the board too, and I don't want to discount what they're doing, but it's so in the fiber of what the reserve banks are doing, and so then I think it makes a lot of sense. It's not surprising that we're hearing some of the descents, some of the distinctive voices coming out of the reserve banks because they really are at the pulse of what's going on.

00:03:58
Speaker 2: We're going to pick up this theme here with Claudia Sam. We are just so honored that she attends to us at eight thirty each and every jobs Day, Dot sm with us, and then Constant Hunter will join us in Christina. Campmeny as well will be with us here. We're commercial free across America for this next half hour. On the data front, it is a continued lift to the equity markets and the vix's I said finally broke down yesterday sixteen seventeen. For days closing up to fifteen level. We may get to a fourteen year with any kind of green on the screen. That's a bullmarket. Fifteen point one point three right now on the VICS, I really need to mention Brand eighty two twenty nine full circle in the quiet of the Eastern Mediterranean. For America, it is Job's Day.

00:04:56
Speaker 7: And the July jobs report crossing the Bloomberg terminal right now, and it shows is that the US economy actually lost twenty three thousand jobs in the month of July. This is a lot less than the eighty thousand we were expecting to be added. We added fifty seven thousand in the month of June. Moving to the unemployment rate, it dipped to four point one percent versus the prior month's four point two percent. The expectation was for four point two percent. Labor force participation rate coming in at sixty one point four percent the month before it was sixty one and a half percent, and that's a bit lower than the expectation. Want to move over to the wage component here, which provides more clues on inflation. Average hourly earnings a month over month up just a tenth of a percent, a scant tenth of a percent. Average hourly earnings year over year up three point two percent. The expectation was for three and a half percent, So again a big surprise to the downside, the economy losing twenty three thousand jobs of the month of July. The expectation was for an addition of eighty thousand. Want to take a quick look at how the market is reacting here looks like futures, guys, at least for the moment, hanging on to those earlier games.

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Speaker 2: Back over to you, a alexis, thank you so much. The markets movie as you can imagine, equities lift here, thinking free money will be out there in a lower rate environment. The yield space is the most elastic, and you see it in the two year yield in a solid nine basis points four point one six percent, basically halfway back to that coveted three point ninety nine thirty year bond. Doesn't come in as much as you'd expect, but nevertheless from a five point twenty two into five point one to nine percent. Damien your thoughts on the set of numbers here, the revisions.

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Speaker 5: Extraordinary, Yeah, yeah, no, I mean exactly. We have a revised down for the last print of twenty thousand from fifty seven, and this negative twenty three print. You would think we'll get some people's attention. But to let's see this point, it looks like equities are kind of looking through it for the minute. And I don't want to call this a nothing burger by any stretch. I mean, Klaudia, I mean you know that this this I wonder if it's going to move markets.

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Speaker 2: We'll have to see her, Claudia Summer, letting her digest the data here a little bit. I do want to with the ECO screen that we have at Bloomberg. The change in non firm payrolls was negative twenty three versus a survey of eighty some people were there, but the two month payroll adjustment and negative one to OZHO three, that's combined negative one hundred twenty six. I think we've given her enough time. Claudia sum joins us here to provide perspective. Claudia, this must change the debate at the FED.

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Speaker 3: So first, does this remind you of anything? I mean a year ago, exactly, this employment report was when we had the very large downward revision, the downside surprise, the downward revisions, and the BLS commissioner lost her job. Right, So now just looking quickly and I can't, you know, do all the details of this government education. Government education was a big decline and one of the things that happens in the summer. It can be really tough with like the school calendars, and if things slip a little bit with the seasonal adjustment, you can get some kind of squirrely numbers in terms of the education. That certainly is at play for the downside miss today. That was something that was very clear in last year's numbers as well, So I don't want to, you know, dismiss this. And of course that was a shift from we'd had a strong labor market to like, whoa, maybe it's not so strong. So I do think there is signal here. There's probably a fair bit of noise and some seasonal issues that'll look through. The unemployment rate did tick down, right. I think the one thing that for the FED that maybe of most interest is wages coming in soft.

00:08:38
Speaker 2: I'm getting out my HP twelve C calculator because Constance Hunter, I wouldn't do this for Claudia. The constance hunter jumped in, here's we can we do this in the control? Can we rip up the script and have Claudia and constants together? Is that? Did you check with their people?

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Speaker 4: Yes, and they say it's okay.

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Speaker 2: Concerts under getting wired up right now, getting folks futures up there too. The advanced Nasdaq lifts double up eight tenths of a percent here, and the yield again, the two year yield is the most elastic in it of four point one six percent. Damian ask a smart question to doctor some Well, I figure out the three months moving average on my HP twelve C.

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Speaker 5: Well, doctor Salm, I mean average hourly earning is down zero point one percent month over month. I mean, you know you mentioned the Beige Book before the break, right, and you know what did the Beige Book show us? The consumers are adjusting by taking on more debt, buying less, but shopping more frequently, trading down to cheaper alternatives. Is this really wearing on them now? I mean, what does this all mean for the consumer?

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Speaker 3: So certainly on the consumer side, this this is not good news. I mean, paychecks are such a key driver of consumers, but I'm not the only driver, but this this is a soft, soft reading. I think the one where you know, the implications maybe come out the strongest. For this is on the FED side, you know, the thing that would get the Fed moving towards rate hikes the fastest. Where if there was any sign of overheated in the labor market, this is exactly the opposite of overheating. We hadn't seen wage growth really picking up, but we really hadn't seen it slowing down much. And so this really takes like the labor market isn't pushing up inflation, and frankly, if it softens it it might help hold down some of that inflation.

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Speaker 2: We are so advantaged. Claudia Somnu's Century Advisors and joining us now Constance Hunter chief Economists EIU. The two of them together commercial free across America in this half hour on yield. Christina cat Menu of Investco will join us here and a Constants Hunter. You're over there working on the terminal looking at the numbers. I got a ninety day average, a three months moving average subject to revision of twenty thousand per month on jobs. You can give me all your academics, Claudia samac I don't care politically in America in defense of the president. That's an unacceptable statistic for America to see it three months moving average of twenty thousand jobs per month. It doesn't get it done.

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Speaker 8: Well, we don't think it gets it done. I'm gonna take off my headphones.

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Speaker 4: Please please take it.

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Speaker 8: I'm echoing in there. Put them back on to here, Claudia. But in any case, you know last year when we had changes to immigration, when we were deporting a number of people, there was widespread spread speculation that actually the monthly requirement had fallen. This year, what we saw with jobs, with payroll numbers increasing monthly, but the unemployment really not coming down significantly.

00:11:36
Speaker 9: Is that well, maybe it's higher this year.

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Speaker 8: This twenty thousand over the last three months, and then that fall in the the unemployment rate that is not That is not a good look for the president. You're right, and it bolsters his case to cut rates. He's going to keep beating that drum. I think this bolster is our call for a hold. This is this is definitely a warrants a hold.

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Speaker 2: Claudia, does does this study that we're seeing right now, can government officials in the fed get out front, or are they colossally ex post where they just have to wait for the data before they go flat or cut rates.

00:12:17
Speaker 3: So, I mean policymakers never have a full picture of the economy when they make a decision. It just it takes too long. And there's always always want one more piece of data, one more piece of information. But when you have enough questions or you have enough tension, that can that certainly can be you know, a reason to move a little more slowly until you get a decisive signal. I mean, I don't I don't think today's data are decisive and in reshaping that we've had a largely balanced labor market so far this year, but they raise some concerns and we'll, you know, get more on inflation. We'll see if the dissiplation is sticking or not. So you get what you have and you have to make a decision.

00:12:51
Speaker 2: Did that she did? She's such a problem. Today's data wasn't decisive. Is there ever an economist who's ever said that today's data is the Damien Sasauwer with constants Hunter and Claudius Constants.

00:13:04
Speaker 5: I mean, I'm just looking at so for futures here, I mean, I see whites up a tick to a tick and a half, Reds are up two and a half, three ticks. I mean, so you know, obviously what we're seeing here yields down, price up? And is that the right you know? Is that the right reaction to this? And just how much do you think the market's going to rush to price September out of the equation? Is that what we're looking at here?

00:13:23
Speaker 8: I think the market will begin to price September out of the equation. I think Claudia is right time. I was almost going to say, you never look at just one number, and of course you don't, but you preface your question on the three month moving average, right, And I think that's what we're talking about here. One piece of concern, right is you saw the unemployment rate fall on.

00:13:41
Speaker 9: For bad reasons, not good reasons.

00:13:44
Speaker 10: Participation felt, people funk exams.

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Speaker 2: Who would that be, folks? Because of that? Where the unemployment rates goes down for bad reasons discuss doctor Hunter.

00:13:54
Speaker 8: Well, certainly, if you see that participation rate decline, it's only one tenth, but it's an off that we saw this load growth of jobs and we saw the unemployment rate fall.

00:14:05
Speaker 9: It suggests to you that either there's low supply.

00:14:09
Speaker 8: Along with load demand that is not a robust labor market situation. And you know, I was looking before I came on last night. I was I got buried in data as I as I sometimes do. And if you look at the FEDS Financial Conditions Index, it suggests it suggests that we have tailwinds. Now those tailwinds are diminishing, but it suggests that monetary policy is loose here. And if we have loose monetary policy and a budget deficit of six percent and this is the best we can do, I think it begs asking some questions about the underlying economy.

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Speaker 5: Yeah, I mean, look, Constance, and the equity market agrees with you. I mean it is rallying here. I mean they see exactly what you see. This is an excuse for them to price out rate hikes, to basically get dubvish.

00:14:54
Speaker 4: And that is great for high for for risky assets.

00:14:57
Speaker 5: And so you know, shifting to you, I mean, Klaudia just talked to us a little bit more about what's the thought. I mean, does this take some of the balance out of what next week's inflation print is going to look like? I mean, what are you looking for next what's the next big figure that you're going to lean into data wise?

00:15:13
Speaker 3: Well, absolutely, the inflation data are front and center, right, and you want to see we got a very soft inflation read for June. We don't expect that to show up again in July exactly that way, but you want to see some softness or at least getting back to something that's consistent with target, right, and so there'll be a lot of attention to the CPI, the PPI, the import prices. I mean, inflation is still front and center because inflation is still very far from the Fed's target, and you need and if nothing else, you want to see it moving in the right direction. Today we're seeing employment move and not the right direction. Maybe next week we'll get some better news on inflation, but I don't think this takes any pressure off of the CPI. And before the Fed meets again, we're gonna get one more payroll and we've got next week's CPI and another one, so there's a lot of data.

00:15:58
Speaker 2: To come across America together. Claudia Sam with us today from New Century Advisors and Constance Hunter of EIU. Off the Shock report, we're up futures up thirty nine. Now Nasdaq is up a solid stick one percent on the Nasdick futures. So even Bitcoin vaults up seven hundred dollars constance demand that I quote Pelly winners there and over one fifty seven on Brench crude right now in the most elastic yield a two year of four point one five percent in a solid nine basis points. I'm going to call that a ginormous movement. Even the ten uere in seven basis points. I want to go to your two wheelhouses, Claudia, let me begin with you, with all of your deserved acclaim over recession. We've had a pop phenomenal GDP. John writing over Breen notes consumption and investment eighth percent like a banana republic. Do you just assume that if we have a tepa job economy and we don't cut rates fast enough, that nominal the animal spirit comes down to a more lower normal rate.

00:17:09
Speaker 3: So I am concerned if the labor market isn't firing on all cylinders, and certainly if it weakens, that would be an issue. And we've seen we've got recent data again, I mean the labor share continues to drop like the share of the income and the economy going to workers. That does not feel like a good situation. And I think to Constance's point, I worry more right now about the structure underpinning the economy than maybe the cyclical the boom bus the research. It's like things are moving under the hood of the labor market, and I think that's the labor force growth, population, aging, what's happening with AI. So there's some really big themes that I think we should pay attention to, and maybe less to the boom bus cycle, right, because I'm not sure that's the biggest thing happening right now.

00:17:56
Speaker 2: I Constance, the EIU remit is a wonder full global remit. What does this job report signal to other central banks? I mean, it simply takes away the effervescence, doesn't it.

00:18:09
Speaker 6: You know?

00:18:09
Speaker 8: I would say other central banks are going to look much more closely at CPI data next week than they are the jobs to data. But of course it does to Claudia's point, right, it's what's going on under the hood here, and we have an aging labor market, or we have an aging population. We're seeing people age out of the labor market. That is not a unique problem. To the United States. Right, we see this around the world. This is a challenge for central banks. And what could argue that is the biggest challenge for Japan and one of the reasons why we have the situation in Japan where they have a very high budget deficit or debt to GDP ratio, right, and there's concern about that fiscal situation and it was getting expressed in the currency, and we had the intervention that we had last week.

00:18:54
Speaker 9: So this theme of.

00:18:57
Speaker 8: You know what, how do you grow an economy with an age population? Does AI help or hinder that These are as existential questions. I think that all economists, central bankers are not are looking at when they're looking at economies right now.

00:19:11
Speaker 5: And yet there's a diet, a desire to keep financial conditions loose here in the US, like you rightly point out, I mean, talk to us about what you learned from yesterday's refunding announcement. I mean they just in my mind, kick the can down the road, again, right, I mean, like, so, you know, your right to focus on fundamentals like debt to GDP or in the US, but the market has not paid attention to that for so long. You know, at what time, you know, the things at least start to flash amber to you constantly.

00:19:35
Speaker 8: So worsh has his task forces, we have our task forces. So there's a few things we're looking at that we felt we had to really do deep dive. And to your point, Tom, across country comparison right up there is is what is fiscal space? What constitutes fiscal space? When does it get tricky?

00:19:52
Speaker 9: Who who?

00:19:53
Speaker 2: You know?

00:19:53
Speaker 8: Obviously we see it's not uniform across countries, and so I think one of the things we have to think about here is what are what is expected in fression and how does that feed into term premia and then what's that back loop to funding the government.

00:20:09
Speaker 2: Christina Campmenian does her people are quite upset, you know, I mean she needs more air time, Claudia, some last question to you, with immense respect for your academics, and it's just simply your launching forward. I guess in the end of August, Jackson Hole and into September as well, it's still to America's the political reality. Kevin Hassett with Bloomberg in the ten o'clock Our folks, Michael McKee and Danny Berger. I'm sorry, Claudia, and in economics on a job's day, it's two distinct Americas, isn't it.

00:20:44
Speaker 3: There's a lot there's a lot of division in the labor market. I mean the division I like to focus on is this low higher, low fire economy. Right for workers who have a job, like their job, it's a good job. This is this still is a pretty good labor market. Today's number is notwithstanding for people trying to get back in, trying to get him for the first time. This is tough. And this wage growth is not keeping up with the price growth, and that's a bigger that's a bigger problem. So yeah, there's a lot of divisions here.

00:21:11
Speaker 2: I love the wage growth idea. This is a this is why we do this. This is good. Thank you so much for the doctor, Sam, Thank you so much New Century Advisor, both of them very active on LinkedIn. Look for their publishing out here today we have also, you know, I love it when world class talent calls it and says me, me, me, me, me, can I get on? We are tentatives. Stephanie Roth schedule to be with us and from City Group Andrew Holland ors who nailed this call. We're trying to line them up right now, we have to go through a I mean, I mean hollan Ors is like great, you just call a cell phone. There, Stephanie Roth, You've got to go through like six layers of compliance. It's like worse than Christina CAMPMANI joining us right now, So let me do this first. And of course always the support of Interactive Brokers. So Bloomberg Surveillance is job's Day across America, brought you by IBKR. For the past three years, Interactive Brokers individual clients average twenty four point three percent annually, beating the S and B five hundred lower costs and access to one hundred and seventy plus global markets matter. Visit ibkr dot com slash performance and we thank Interactive Brokers for foundational support of everything we do. Christina, thank us for being patient off the shock economics. How does this economics play into a two year full faith and credit market?

00:22:36
Speaker 11: Look, I mean, the market is sitting here and we've been all trying to understand what is the new reaction function of the FED. Chair of the Fed Committee under.

00:22:43
Speaker 2: Wars and he wants it to be data.

00:22:46
Speaker 11: I don't know if we know what he wants it to be. Quite yet. I think the jury is still out there, and I think July was very different than June, so we'll see. But the market is grappling with all of these data prints, and we've taken out certainly pricing for September year pricing now what just about one full hike only by December.

00:23:04
Speaker 5: So I mean, I know you guys are short duration over there at Investment. I know you, like Steve NAR's talked to us about how does this change the the you know, your outlook at all over the near term.

00:23:14
Speaker 11: Look, I think there are a few things. Again, if we go back to this new regime from the Fed and talking about letting the market do the work, I think that introduces a lot more volatility, and especially in the back end of the curve. So I think that still means that you are looking for higher yields, higher yields out the curve and steeper curve. We haven't broadly this year, You've seen a lot of flattening of the curves, so I think that that still holds. And the tremendous amount of AI and hyperscaler issuance weighs on that too. And I know you guys have been talking about that today and it's been a theme. But you have these companies that are issuing the size of government bond deals weighing on the market. So I think we are still warranting, needing higher yields out the curve.

00:23:58
Speaker 5: So Christina, you know, I'm an emerging market fixing guy. I look at em credit, I look at the basis to investment grade spreads and I look at it and I say, wow, ten basis points. Wow, that is as tight as I have ever ever seen it. And I think you're absolutely right to hit on that. I think you're to date what three hundred billion in hyper scale. We call it AI issuance. Going forward, I mean it's not going to go away, right, I mean they just roll this over, add to it. I mean, at what point do you see the crowding out effect that many many strategists and analysts are calling for here.

00:24:26
Speaker 4: So we have been again.

00:24:28
Speaker 11: When we look at our portfolios and we manage global portfolios, we have the three lovers of rates, credit and FX. Credit is where we've leaned on the least just because of how tight spreads are. And I know that's kind of been unpopular opinion, and corporates have continued to perform well and stay tight. But I think that's where there's the most kind of jump risk and concern. And I think it's been supported by this appetite for all in yields just given levels. But like you have to take a step back and say, A, you have this changing regimes, which should mean higher even government bonds. You are it's not the end of issuance out of visa sure, So there's more to come. And we've been at such compressed yield levels for so long, So talking about can a tenure be at five and a quarter?

00:25:10
Speaker 10: Sure?

00:25:11
Speaker 11: Is that in the potential?

00:25:13
Speaker 5: So you know, we talk about the different factors which drive total returns and fixed income. You've got duration, you've got spread, you've got coupon income, you have FX, right, so talk to us about you know exactly what you do if you if you don't like duration and you don't like spreads, does that mean you're shifting and you're kind of leaning into currency risk here?

00:25:31
Speaker 11: So currency risk has definitely been kind of top of mind, i'd say, of the last two years. It's certainly I know something Tom and I have been talking about of like Asia is so mispriced, Asia so much price, and it's that kind of what has been most miss Price has been frustrating and obviously has gotten more play in the last week and a half with official EN intervention in the Korea move. But yeah, I think we are sitting in an environment where people, even coming out of the July meeting say, okay, from an FX person, we're in this multipolar world. There are different things driving in. So can we lean into Amcerrey and at least until we get music to my kind of to the to the next FED meeting, we have this holding period, We have a lot of data. This is obviously a shift, but like let's take a step back to and say, when we came to the beginning of the year, people were talking about is breaking van payrolls zero twenty five fifty. So yes, this is a big reset from where we were running the first three months of the year. But maybe that thesis actually hasn't changed, so it's not as robust.

00:26:34
Speaker 7: But this is not This is.

00:26:36
Speaker 2: Just wonderful force, Claudia. So I'm with this consense hunter to Christina Campmany who looks at yield with their global reach, and we've got scheduled Stephanie Roth and Andrew Hollan Orst we're working on right now. It's City group. I want you to take the yield shop here, get too many economists lined up. We got to get some real conversation and which Christina camp Many as well. Do you have an underlying disinflation and real GDP growth vectors that are lower that will support a lower yield environment.

00:27:07
Speaker 11: Look, I think that there are disinflationary trends that were in place at the beginning of the year. Again, if you zoom back to where we were in January, before middle East situation kind of became front and center. That was the thesis Housing to come down, like a lot of these things to come down. Again, We're back in the world with a lot of uncertainty. We don't know what the situation in the Middle East is. We don't know where oil will end up. It has been shoppy, it has come down. I think at Frood, sitting at eighty is something that the economy can sustain. At one twenty, that's very different. And I think what the FED is trying to weed through in all of us, in the markets and all the economists are what is most concerning, most likely for the FED is the kind of COVID style rollover that you're seeing it into wages and into pricing power in the economy and that which we haven't seen yet. But it's something that people are concerned about, is.

00:28:00
Speaker 2: What it's my scientific analysis. Christina KEMMANI thank us so much with Invesco with great perspective. There again that benchmark two year yield four point one seven percent now in eight basis points. Stay with us. More from Bloomberg Surveillance coming up after this.

00:28:25
Speaker 1: You're listening to the Bloomberg Surveillance podcast. Catch us live weekday afternoons from seven to ten am Eastern Listen on Apple Karplay and Android Otto with the Bloomberg Business app, or watch us live on YouTube.

00:28:37
Speaker 2: Okay, this is totally different. Nicole showed she invented there sort of the hipster digital economy. She was a Zillo as a young kid, and she's just built and built and built up a different knowledge than Wall Street now was Zipper recruiter, they're chief economists. Nicole was showed to piece it together for us this morning. What's different differ that you see in the modern hipster Seattle digital economy, Nicole than what we hear from Global Wall Street.

00:29:10
Speaker 6: What we're seeing right now is people across the board are really responding to different macroeconomic influences, but we're kind of all in the same realm here. There's a lot of stagnation in the labor market right now, hesitation from employers and from workers, people on the sidelines. Everybody's kind of afraid to make a move because there's so much volatility happening in the market right now.

00:29:35
Speaker 3: It's really difficult.

00:29:36
Speaker 6: To see on the horizon, you know, when there's going to be clarity and when people can really commit to that next step.

00:29:41
Speaker 2: Do you believe the data? I do?

00:29:45
Speaker 12: You know?

00:29:46
Speaker 6: We're seeing this response to really high volatility in prices. Inflation is bouncing around pretty wildly the last couple of months, and we're seeing the response coming from both employers and from workers. This simultaneous pullback in supply and demand for jobs is leading to this really unique environment we're in right now. You know, unemployment is dropping at the same time that job growth is slowing, but that's because there are fewer.

00:30:13
Speaker 3: People who were still looking for work.

00:30:15
Speaker 6: As we see these labor force dynamic changes, that's really going to shape what the labor market looks like going forward and what jobs and how many jobs we actually need to have a stable economy.

00:30:26
Speaker 5: Nicole, the ZIP Recruiter job seecret Confidence index was at like its highest since twenty twenty two in the first quarter of this year. Are things changing right now? I mean, what's your take? How are things on the ground.

00:30:39
Speaker 6: Yeah, yeah, we're We're getting our next round of the job Secer Confidence Survey back just this week, and you know, we're still seeing that job seekers are remaining confident. And I think that you know, the confidence in the market and the availability of jobs, those things are are kind of different. You know, job seekers are a resilient They're utilizing the resources that are available to them. Job Seekers who tap into AI tools and resources are seeing better results in their job searches and are having more confident searches. So people who are really you know, taking advantage of every opportunity and resource they have, that's who we're really seeing benefit in this.

00:31:19
Speaker 2: Market, Jamien says or Nicole Bashaw chief Economists a ZIP Recruiter can't sit enough about it, folks. Stacey Vinnix with is on deck as well. There's been a sighting. Of course, we'll continue with Nicole Nicole.

00:31:33
Speaker 5: I have a son who's going to be a senior in good and my question for you is, are you seeing anything in the demographics. I mean, what do you envisage for you know, first time entrance into the labor market. Are things more or less difficult for them?

00:31:49
Speaker 6: Things are really challenging for new entrants to the labor market right now. What we found in our spring grad report a couple of months ago is people who had or these new grads who had work experience on their resume from some type of job during school. We're more than twice as likely to land employment post graduation than there are peers who didn't have any work experience. So finding a way to take any opportunity, whether that's being a teaching assistant or you know, doing some sort of volunteer program, putting that on a resume on paper and highlighting the skills and how that translates to the workplace. That's what employers are looking for from these young feoks.

00:32:24
Speaker 2: So what have you learned from say Amazon and the kind of person they're laying off. They're still hiring everybody on Third Avenue unloading boxes. I get it. They're still hiring all the AI E I EIO people. I get it. But you know what the knowledge tells me is they're unloading middle managers. Where are those people going to get jobs? Nicle.

00:32:48
Speaker 6: What we're seeing, especially with the impacts of how AI is reshaping the labor marketing jobs, is the skills needed within jobs are turning over really rapidly. So somebody who is is, say a software engineer, needs a different skill set today than they did five years ago, the same way that somebody is, like a clerical assistant, needs a different skill set. So we're going to see more turnover within jobs as that starts to play out. Job seekers who are able to be more well rounded, who are really upskilling themselves on how to use AI and how to market that skill. That's who's really going to win out in this environment, and that's what employers are looking for right now.

00:33:25
Speaker 2: Thank you so much, Nicolby Shoulder. This chief Economist ZIP recruiter out on Seattle. Stay with us. More from Bloomberg Surveillance coming up after this.

00:33:42
Speaker 1: You're listening to the Bloomberg Surveillance podcast. Catch us live weekday afternoons from seven to ten am Eastern Listen on Applecarplay and Android Otto with the Bloomberg Business app or watch us live on YouTube and.

00:33:55
Speaker 2: Chris cross the Pacific from San Diego up to Vancouver. There's just so much that we do cover being here on the far and distant shore. Geens Soroca owns the high ground here driving all of the Los Angeles port technology. It's been doing it for twelve fourteen years. We're thrilled. We love when he comes in because he just gives us a flavor thumb up or thumb down. Right now on Pacific transport, given a war thumbs up.

00:34:22
Speaker 10: We've seen a lot of fits and starts because of trade policy, the warner around. There are five conflicts happening in the Middle East right now. The Sewiz Canal effectively has been running at ten to twenty percent efficiency for four years. So cargo has really started to move into that southern California gateway over this time because it didn't have that many options. But you know, Tom, compared to COVID nineteen when we saw those ships backed up and the pilots of cargo, things.

00:34:50
Speaker 2: Are moving normal.

00:34:51
Speaker 10: We've moved more cargo during this time period than we did during the peak of the peak then, and not one ship is the back.

00:34:58
Speaker 2: Onion members happy? Are they working triple overtime? Kind of bait.

00:35:02
Speaker 10: I see some of these guys at the Elks Club for happy Hour. They're getting a lot of hours on the job. They're working, they're throwing the cargo, they're hustling. Yeah, they're the best in the business.

00:35:11
Speaker 2: Like, yeah, it's like overtime.

00:35:13
Speaker 5: Why teens making comparisons to with what the market was like at the height of the pandemic and how improved, how much more efficient it's running. I mean, talk to us a little bit about those lessons you learn from the pandemic. Are they paying off?

00:35:24
Speaker 10: Yeah, Damien. Two things. Number One, we had to be humble, lean on each other, kind of open up the books a little bit and see where it went wrong. And it was probably a little bit of communication laps, folks doing things on their own. Nobody trying to do anything sinister, but everybody was out there just trying to edge ahead for themselves. Second, the advent of technology, whether it's the truck reservation system, being able to see cargo forty days before it lands on the shore of Los Angeles, all of that makes us smarter. Leaning on each other made us better.

00:35:55
Speaker 5: You know, Tom, this is amazing because you know, if you look at JP Morgan, a lot of these people and what they're talking about. What they got wrong here about the impact of inflation, of horror moves of Iran on inflation here in the US is that the demand destruction is real, like the way that the consumer has adjusted their demand patterns in order to adjust to the supply. Shop talk to us about what else you're seeing from the perspective of the consumer. Are you seeing volumes still continuing to expand, are they, you know, kind of getting a little constrained here?

00:36:21
Speaker 4: What are your thoughts?

00:36:21
Speaker 10: Yeah, Daman, the example is happening right now. We saw small to middle sized importers bringing in their cargo a little bit earlier than a traditional peak season. Two main reasons. One, the temporary tariffs were expiring on July twenty fourth. I know my price, I've got a window. I've got to speed the cargo to market. And then second, the fuel adjustment factors in the shipping industry lag by about three months, so they saw a day when that price was going to spike. Let me average my cost down, get as much product in as I can.

00:36:51
Speaker 2: I look at this Jane and wrapped around it is. I think it's eighty different cities in Los Angeles, and Los Angeles is like big than Rhode Island.

00:37:00
Speaker 10: That's right, in eighty eight cities in LA County.

00:37:03
Speaker 2: What's the state? You're such a great voice for an LA down trodden billionaire's text. Everybody's moving to Austin, Texas, or they're moving up to the Central Valley, et cetera, et cetera. What's the real story of LA right now that you see one.

00:37:19
Speaker 10: In fifteen working Angelinos have a job related to this port complex and supply chain. Wow, that's super powerful. We've got twenty million people that live in southern California, so when we do all these imports, we got a lot of mouths to feed. We've got a lot of consumers. We also have the largest manufacturing base of employment in the country, four hundred thousand jobs in LA County. A lot of manufacturing, knows.

00:37:43
Speaker 2: My father used to lecture me on this, like McDonald Douglas and the rest of the way back Aerospace and.

00:37:49
Speaker 10: All it's aerospace saving events is one hundreds in Atlanta Richfield.

00:37:54
Speaker 2: You know, you're not even old enough to remember Atlanta Richfield, but The bottom line is, did you just say it's the largest manufacturing base.

00:38:02
Speaker 10: Of employment in the country in La County.

00:38:05
Speaker 5: You know, I have to ask you this, Gina, and I'm sorry to shift gears, but you know, I haven't heard much about the rebuilts into the wildfires hit Malibu in La County. I mean, can you give us a little bit of insight as a local there? I mean, are we seeing people, you know, move back into the area. Are people building there again? Talk to us a little bit about that.

00:38:20
Speaker 10: The progress and the resolver two different things. Folks absolutely want to get back into Alta Dina to Pacific Palisades and even the edges of Malibu that were burned so badly. But one thing that's real are the international and tariff policies. Softwood lumber that comes out of Canada. Appliances that are made in the Makuiladora areas of Mexico steal with fifty percent tariffs. Furniture and footwear are up ten percent or more over last year. It's more expensive to rebuild. And then, of course, as you guys have reported, there's a gap between the insurance coverage and the rebuild cost, exacerbated by terriffs, Jeez Ruca.

00:39:02
Speaker 2: Where there's from Los Angeles driving all over the port there. Love having them in with the flavor of Southern California. You grew up in New Orleans. You're in school in New Orleans, which is humidity and heat. Now you're out in Southern California, which is I guess dry and heat, and it's getting a hotter. Discuss climate change. Is it affects your staff, the customers of your operation. It's getting hotter out in Phoenix over to La, isn't it?

00:39:28
Speaker 6: It?

00:39:29
Speaker 10: Sure is? Tom feel it. I feel it. And the thing that we look at the most is in that harbor enclave at the Port of LA. We've got two hundred and sixty thousand residents in San Pedro, Wilmington, Harbor City, Harbor Gateway, and Watts. There are millions more that live along these key commerce corridors. We believe it's our job to bring that health risk down through reduction and pollution. We've reduced diesel particulate matter tailpipe pollution by ninety one percent since we started our clean Air Action plan in two thousand and six.

00:40:02
Speaker 2: Did Jamie once again a month I got to get this one question and Damien takeover. Gee, how do you respond to forty five tankers stuck in the Persian Gulf?

00:40:13
Speaker 10: Having lived and worked in the Middle East for five years, Tom, I'm keeping up with my business contacts and lifelong friends that I made during my time stationed in Dubai. This is really tough because it's the crew members that are on these vessels that have been stranded. Now we're in our six month of this war, and there are other conflicts happening throughout the region that have put an unbelievable amount of stress on these people that guide the ships and the supply chains they support. There's an adage in our industry. If your port gets shut down for a day, whether whatever the case may be, it takes about three days to catch up. We're now six months into this war, straight of horror, moves closed, open, really closed. It's going to take a long time not only to get these ships back into rotation, but to repair the damage that's been done through this war torn region and future proof it.

00:41:03
Speaker 5: You know, I'd love to ask him about why the Dodgers have just lost six in row, whether or not you're worried about it. But Gene, what I really will ask he was about on Nino and how you expect the port to adapt, you know, to climate change rightly point out, I mean, Tom, I think he hit the nail on the head here. You know, there's going to be some interesting dynamics. What are you expecting through the second half of this yearfl Nino really does continue and it starts to even you know, get stronger here.

00:41:25
Speaker 10: Well, this is not meant to be to the detriment of any other port. Ricardo Vasquez who my friend Katin, who runs the Panama Canal Authority, good friend, great businessman. He's now faced with some issues. Yeah, what we're doing is not taking his cargo. We're planning in the event he can't move as much product through his three locks in the canal. How do we prepare in Los Angeles to get ready? I see that just on the drawing board here probably a five percent up ticking cargo because some of it will move to avoid any type of concerns in the supply chain. We're working with our Harbor Trucking Association Robert Loyer, are terminal operators, our rail partners, and longshore labor to make sure guys down the pipe. We see a little bit of an uptick. Let's get ready with our skilled labor, land and machinery to take that on. And if it doesn't happen, there's no shame in that. But we've got to have the preparedness based on these changes in supply chain patterns.

00:42:20
Speaker 2: We welcome all of you across America and of course early morning Pacific rim as well, from San Diego up to Vancouver farther north through good Morning Whistler where I think it's almost sixty degrees Robbie, nice sir, the way you choose to listen to us, Thank you so much on Serious XM, and of course Good Morning ninety two nine FM, Boston, ninety nine one FM, Nathan Hager Radio Washington in Bloomberg eleven three to zero Jobs Day and about I'm doing the math fifteen sixteen minutes with a great lineup. But this is just a joy on a summer Friday to talk to Jeene Soroka about the pulse going north from the port. We have stereotypes here, but as you go up to San Francisco up to Portland, Oregon, all the Carnie and Canada is doing on their west coast. It's basically a booming. How many miles I'm going to say one thousand miles? Am I guessing pretty close? It's booming right absolutely, and so are we.

00:43:21
Speaker 10: This Port of Los Angeles is in a period of time right now, Tom, where we've really lined up our commercial business. The relationships run deep across the supply chain, and the financial setting that we're in right now has never been better. We've got one hundred and sixty capital improvement projects on our dashtar.

00:43:38
Speaker 12: Give us an.

00:43:38
Speaker 2: Example of that. Give us a capital improvement.

00:43:40
Speaker 10: One of the reasons I'm in New York this week. We just signed an agreement with the Newsom administration California Governor Gavin Newsom's administration to build a new bridge that traverses from the residential areas in San Pedro to Terminal Island. I'm here seeing banks and financial constitutions so to work on a P three concept that's never been unbefel We're really excited about this. We're also building a new cruise terminal that's being helped out by a number in the industry, including Carricks and SSA, And for the first time in a generation, we've got bids due in December for a brand new container to the investment at the Port of la is off the time.

00:44:17
Speaker 2: I'm sorry. The bridge has got to be the true Scooball Bridge.

00:44:20
Speaker 4: Oh my god, it's got to be.

00:44:21
Speaker 5: But you know, I just thought Gen was in town basically meeting with colleagues at the Port of New York and New Jersey, you know, like going golfing and outside of port of list.

00:44:28
Speaker 2: Of ports here from three thousand miles away. Yeah, it's quick to the state of the ports here.

00:44:32
Speaker 10: Beth Rooney runs the Port of New York and New Jersey. She is one of the best in the business. And these guys mean so much. You're within drive time of two thirds of the American population with cargo coming in and out of this gateway. It is essential for the American economy.

00:44:47
Speaker 5: I mean, do you regularly interact obviously with the Port of New York, New Jersey, but Port of Savannah, you know all these I mean, do you guys kind of you know, like, like you rightly point out, I go preparing for some you know, some sort of something happened with the Panama Canals. You guys kind of all work together. Make sure that logistically speaking, you guys are on the same page.

00:45:02
Speaker 10: Yeah, and contrary to popular opinion, we all get along extremely well. The pockets of cargo, the people that we serve, and the jobs that we have to do every day are so important to this country and our local communities. It is a really good band of folks that we have working together at ports in the US today.

00:45:18
Speaker 2: He has never said anything negative.

00:45:23
Speaker 4: She has the gift. It's unbelievable.

00:45:25
Speaker 2: What's along shoreman make?

00:45:28
Speaker 10: It depends. These guys out on the West coast do really well. But this is one of the most dangerous things.

00:45:35
Speaker 2: You didn't answer my question. They're popping big six figures, right.

00:45:38
Speaker 10: Yeah, they make a good middle class wage. Now you've got registered Launchhorman about nine thousand.

00:45:45
Speaker 2: They make the middle class wage if this America was build on after World War Two. These are guys making a legit middle class.

00:45:54
Speaker 10: Wage on average north of two hundred thousand.

00:45:56
Speaker 2: It's why is it evaporated from America? Why have we lost the jobs that were middle class in Detroit, the jobs in New Jersey that were middle class, the ones you're living right now at the port.

00:46:10
Speaker 10: Again, we look at Detroit. We do about thirty billion dollars worth of business with the OEMs and Detroit and the tiered suppliers throughout the Ohio Valley. I've been impressed by what Michigan has done to modernize around the industry. You got four miles of electrical cable and cars. Now the price being at fifty thousand dollars for a new vehicle is problematic and it is symptomatic of what we've talked about with respects to inflation and trade policies. But the state of Michigan is behind its automotive industry.

00:46:41
Speaker 5: I mean, I mean, you know, if you're going to let me, I mean, I'm happy to ask you, Geane, what outside of you know, meeting with banks and finance types and trying to get you know, funding for you know, you for what our hopefully great investments talk to us about, you know, demand for those meetings, demand for infrastructure, demand for infrastructure investments. Are you seeing you know, people you know willing to put their hands in their pockets in this enom environment with yields where they are to to to lend to you over the long term.

00:47:07
Speaker 12: I do, and this.

00:47:08
Speaker 10: Week in New York it's been super encouraging the way folks look at it is and for agencies like ours, we have to invest through budget cycles, economic cycles, and even election cycles. Now. To build this new bridge from Stem to Stern will be about seven to ten years. So we can't get to the point where we're wringing our hands today because things don't look exactly perfect. And that's what the big thinkers here in Manhattan we're telling me this week.

00:47:34
Speaker 2: The K Scooble Bridge. Do you know the Dodgers have lost six in a row and they're still playing.

00:47:38
Speaker 5: They ran into a buzz so they ran into the Red Sox, right, and then I think the Cubs just got them.

00:47:42
Speaker 2: The Cuts got them.

00:47:43
Speaker 10: Yeah, they got swept two series in a row, one at home, one on the road.

00:47:47
Speaker 2: Crisis.

00:47:47
Speaker 4: Yes, no, I'm kidding.

00:47:48
Speaker 10: It's one hundred and sixty two game season. You're gonna go through bumps, Okay, back to back World Series champs. I'm not gonna count them out.

00:47:56
Speaker 2: Okay. Thank god Detroit named it the Gordy Howbridge, now the Terrek School Bridge. James Soroka, thank you so much. Stay with us. More from Bloomberg Surveillance coming up after this.

00:48:15
Speaker 1: You're listening to the Bloomberg Surveillance podcast. Catch us Live weekday afternoons. From seven to ten am Eastern. Listen on Applecarplay and Android Auto with the Bloomberg Business app, or watch us live on YouTube.

00:48:28
Speaker 2: What we're gonna do here. We're going to get the market open here in six minutes and helping out right now. Or see if wolf Associates is Bruce wolf Well actually worries about like retirement systems. This is off of his service at Blackrock, and we're thrilled he could join us today four oh one case. They've been on fire here, nobody remembers when they went down. They went down. Give us where we're going to be on our four to oh one k planning one year out, five years out.

00:48:59
Speaker 13: Yeah, it's a great point because it's I think affecting people's behavior quite a bit that they're like, oh, the markets are just going to keep going up. And one of the areas that I focus on is when individuals actually move into retirement and now are going to start to spend down their money, And in my view is that it's a different problem when you're thinking about individuals accumulating assets versus spending down their assets. And we've spent the last forty years, I think doing a very good job of helping individuals save for retirement. But I don't think we've spent nearly as much time and effort and helping individuals as they draw down. And the key point there is we're solving for a different problem, right, Helping people save for retirement is very different than helping them live in retirement.

00:49:45
Speaker 5: Bruce is you know, we live in a country that is very bifurcated just in terms of haves and the have not. Sure big take article this weekend was just an unbelievably scathing one. I mean, I have to say it, it's an amazing article. I read the whole thing. It's a tax strategy for the rich, built by the world's largest hedge fund, and they're talking about fastness, AQR and tax loss harvesting. For our audience, can you just give us a quick one thousand to few of what tax loss harvesting is and how important a role it's now playing in retirement portfolios for the rich?

00:50:14
Speaker 12: Sure?

00:50:15
Speaker 13: So, for you know, as we know, as you just was alluded to, assets have gone up dramatically, right, so you have a high level of capital gains associated with a lot of the underlying stocks. And so the idea is with tax loss harvesting is trying to find a way in essence to offset losses that you may have in your portfolio with gains and as a result, you'll net out and mitigate the amount of taxes that an individual may incur when they're selling out of a position right right, And that's clearly has become increasingly important over time.

00:50:45
Speaker 2: Parents does eight pages last week on annuities. I think you're dead on that. The entire thing was successfully to build up a pot and now we've got to figure out what to do with our annuities. Efficacious is a way to structure income outflow of a retirement.

00:51:03
Speaker 12: They are one for sure.

00:51:05
Speaker 13: They are one way to do it, and they're very simple annuities that you can use. And the point that I would make is when you're thinking about moving into retirement, basically I'd create two buckets. I have one bucket that's associated with delivering cash flows, so maybe your required expenses or necessities, and then you have another bucket for discretionary spend and for that bucket that's associated with it requireds. I think you want to look towards solutions, and there are interesting investment solutions as well. Aside from annuities that will deliver those cash flows, right and give you that level of certainty, right, and then for the rest of your portfolio you basically can go ahead and you can invest that more aggressively.

00:51:45
Speaker 2: Is your math? Four percent is still the bogie on retirement because there's a whole industry out there saying you can go higher.

00:51:53
Speaker 13: So I have a fundamental view that I think the four percent rule is something that is an interesting of thumb, but for some reason has become the retirement strategy for many people out there, and I don't think that's correct.

00:52:07
Speaker 5: Right.

00:52:08
Speaker 13: The four percent rule, if you go back to how it was designed, does not really reflect the realities and the complexities of people moving into retalks.

00:52:15
Speaker 4: One last question here.

00:52:17
Speaker 5: Every single guest, every single guest we've had on today, is talking about shorting duration, shorting the long end of the old curve. Yet that is critical part of the yild curve for insurers for pensions. Talk to us about what this all means. If people stop buying long dated paper, long dated treasury paper here in the US, how is it going to impact the pension market?

00:52:35
Speaker 13: Yeah so, as relates to yeah so buying lesson too, the market obviously is going to to drive upbraids.

00:52:41
Speaker 12: It's what we're seeing now, is right.

00:52:44
Speaker 13: I mean rates are up, which makes annuities attractive, more attractive than they were, you know five years ago.

00:52:50
Speaker 12: For example, who was holding.

00:52:51
Speaker 4: Those annuities that were five years ago?

00:52:53
Speaker 13: That's no problem, right, Yeah, And that's why I don't think you want to think about buying annuities as that's going to be the be all for you know, in terms of a strategy for you, it should be a component. And I would actually say the most effective way to think about annuities is around protecting against longevity.

00:53:09
Speaker 2: Can you stay round? Of course, don't move, Bruce Wolf, We're going to come back here. These are top topics I should mention. Bloomberg Money today at twelve noon, Meredith Whitney with us on charge Cards and Consumption and the David Kelly of JP Morgan will join us as well. We've got a special golf guest as well, because Damien said he won't watch Bloomberg Money unless we do more golf.

00:53:34
Speaker 4: Quite true.

00:53:34
Speaker 2: Seriously, at the head of the PGA, come on undred days if it's good. What a morning it has been saving us. Alexis Pistophorus and Tom Mack.

00:53:43
Speaker 7: Softer then expected July job support gave futures a nice lift, and that is translating into regular trading. So on this Friday, We've got the S and P five hundred starting the day off up about twenty six points, or a third of a percent, Dow Jones industrial leverage up about seventy points or a tenth of a percent. Both are on pace for their biggest weekly gained since April. We've got the Nasdaq up one hundred and ninety five points, looking at its best week since early May. Also Nasdaq one hundred up two hundred and forty three part points to start this Friday morning. The Bloomberg Dollars Spot Index down four tenths of a percent at twelve hundred point thirty. The Japanese yen up six tenths of a percent at one fifty seven forty two against the US dollar. Yields lower across the board after that weaker than expected jobs report, the two year yield four point seventeen percent, down six basis points, the ten year down five basis points at four point six two percent. We have got Bigcoin up more than one percent, now just above sixty five one hundred dollars, and spot gold is up nearly three percent at forty three fifty five the ounce, and taking a look at some stock movers, under Armor is a big loser here in the early going down about nine percent after it forecasts a bigger than expected revenue decline in the current quarter. That is your Bloomberg opening bell, Tom and Davian, thanks.

00:55:01
Speaker 2: So much, Alexis. Drew Mattis just publishes a met life, a blistering note on a fed on hold. He says, unemployment dips. That's the unemployment rate, but also so does participation dips, which leads to a soggy economy. SNP right the Dow up twenty two points, Nastick up eight tens of a percent. We continue with Bruce Wolf founder CS Wolf and Associates on our fractured retirement system money question Erisa nineteen seventy four. Were we better off with the defined benefit architecture than this modern everyone for themself architecture?

00:55:37
Speaker 12: Sure?

00:55:38
Speaker 13: Yeah, I mean I think if you could go back in time and ask individuals do they want to define contribution program or a defined benefit program? You would clearly, I think hear from individuals that they prefer to have a defined benefit program. And if you really think about the direction of travel with the DC structure, it's moving more and more towards trying to replicate as much as possibility.

00:56:01
Speaker 2: Yeah.

00:56:02
Speaker 13: Right, So it's a little bit of back to the future in terms of the structure. And be it within a four to one K or even through the wealth management side of the house, it's the same deal.

00:56:09
Speaker 5: Well, talk to us about the hedging that insurers have to do in order to match their liabilities, right, And I mean I come back to this thought that you know, doctor Crowz was talking about earlier that you know, the participation of leveraged funds, of hedge funds in the US treasury market, especially at the long end, and how volatile that's starting to get. You know, what does that mean when you're inside one of these very sophisticated, long dated perpetual insurers and you have to kind of match your liabilities to this. I mean, like, does it become more expensive?

00:56:36
Speaker 4: Does it be?

00:56:36
Speaker 5: I mean, at what point does the rubber meet meet the road here?

00:56:39
Speaker 2: Yeah?

00:56:39
Speaker 12: Sure, absolutely become more expensive.

00:56:41
Speaker 13: Yeah, you know, there's no question and the and you know, and then kind of coming back to for individuals, right, because this is the idea that if individuals are going to be more and more either automatically put into annuity like for example, we've seen trends with target day funds. That's right, right, where an annuity is now attached to that either you automatically put into it or you know, be able to actively move into it.

00:57:04
Speaker 12: You know.

00:57:05
Speaker 13: I think the annuity market is going to become more and more kind of democratized in a sense that more and more people are going to be taking on an annuity as a portion, right. And the key point there is as a portion of the income. And you think about it at the end of the day, what's the objective when you're in retirement.

00:57:23
Speaker 2: Well, we're gonna have to leave it there. Bruce Will, thank This has been perfectly time. Bruce Will, thank you so much. I may see us Wolf and associates.

00:57:29
Speaker 1: This is the Bloomberg Surveillance podcast, available on Apple, Spotify, and anywhere else you get your podcasts. Listen live each weekday seven to ten am Eastern on Bloomberg dot Com, the iHeartRadio app, tune In, and the Bloomberg Business app. You can also watch us live every weekday on YouTube and always on the Bloomberg terminal