Speaker 1: Bloomberg Audio Studios, podcasts, radio news.
Speaker 2: A single best idea, and since we've had two hours sleep,
Speaker 2: I think two nights in a row is a collective
Speaker 2: team here at Bloomberg's Surveillance that we're gonna make this
Speaker 2: quick today, but we can't because the guest quality today
Speaker 2: was so much. I can't say enough about the conversation
Speaker 2: with ed El Husseini and Ira Jersey. We broke a
Speaker 2: rule at the beginning of the nine o'clock hour and
Speaker 2: we talked very sophisticated short term paper fixed income stuff
Speaker 2: like what pros in the street talk about. We really
Speaker 2: try to stay jargon free, and ed ed L. Husseini
Speaker 2: of Columbia Thread Needle was actually quite good about that.
Speaker 2: I can't say it about Ira Jersey. He was on fire.
Speaker 2: He is a true expert for Bloomberg Intelligence on the
Speaker 2: short term market, what I call the trust market. And
Speaker 2: you know who's looking at that right now, the Fed.
Speaker 2: Here's Ira Jersey on the FED.
Speaker 3: I think the Federal Reserve has a job to do here,
Speaker 3: and it's more of a traditional job that we've kind
Speaker 3: of forgotten about over the last seventeen or eighteen years,
Speaker 3: and that's that they are the lender of last resort
Speaker 3: and who are they going to lend to at this point. Well,
Speaker 3: they've created some liquidity programs that just haven't worked the
Speaker 3: way that they had hoped. So there's the standing REPO
Speaker 3: facility that they thought would be able to replace the
Speaker 3: traditional open market operations, liquidity operations that they had done
Speaker 3: every day. They used to do these operations every single
Speaker 3: day prior to two thousand and eight. But it's not
Speaker 3: working because it's design. It has design flaws, and you
Speaker 3: know that's probably too wonky for most of your listeners.
Speaker 3: But let's think about the Federal Reserve as a first
Speaker 3: step doing traditional open market operations, just like it did
Speaker 3: after the REPO hiccup in twenty nineteen. So they do overnights,
Speaker 3: they do one week repos. They basically they basically allow
Speaker 3: balance sheets to expand a little bit for people to
Speaker 3: take advantage of relative value opportunities in the treasury market.
Speaker 3: And I agree with Ed that is the you know,
Speaker 3: that would be a beneficial outcome. The second thing that's
Speaker 3: very easy to do that you know, I hope that
Speaker 3: the FSOC, the Financial Stability Oversight Council, gets together in
Speaker 3: an emergency meeting soon and says, hey, let's do something
Speaker 3: that we were thinking about doing anyway, and just get
Speaker 3: rid of the supplementary leverage ratio from treasury. So exempt
Speaker 3: treasuries from some of the bank capital rules, that allows
Speaker 3: balance sheets to expand. It incentivizes dealers and banks to
Speaker 3: actually buy some treasuries. Those are two easy things that
Speaker 3: could be done today, right, So it's not And those
Speaker 3: aren't things that are unusual either. We did do them
Speaker 3: in March of twenty twenty.
Speaker 2: The advantage of a podcast, you can rewind it and
Speaker 2: listen to that again. That is a window into the
Speaker 2: adult perspective of Bloomberg Intelligence. There unfixed income our Jersey,
Speaker 2: but Gina Martin Adams today, inequities, Damien Sassauer and em
Speaker 2: these people are grizzled Wall Street pros. We rarely do that,
Speaker 2: but you just got a window into the inside baseball
Speaker 2: and the trust market. That's what we try to do
Speaker 2: here at Bloomberg Surveillance. We also like to look at
Speaker 2: people's biography. Pat Haskell is at Blackrock and yes it's
Speaker 2: municipal bonds, but far more than that, he has decade
Speaker 2: of experience out of Union College of being on desks
Speaker 2: and with a tension we saw this morning at four am,
Speaker 2: five am to worry about hedge funds and all. It
Speaker 2: was a joy to have Pat Haskell with us, just
Speaker 2: to give perspective across previous crises. Here the gentleman from Blackrock.
Speaker 4: If we step back, one of the great traders I
Speaker 4: work with early in my career and a client of mine,
Speaker 4: always said, first rule of trading always fade emotion. So
Speaker 4: if we step back, now we think about this and
Speaker 4: we're like, all right, what's going to happen? Is a
Speaker 4: recession likely to result from this?
Speaker 2: Yes?
Speaker 4: Is the FED likely to have lower rates a year end?
Speaker 2: Yes?
Speaker 4: So when I think about that and I back into
Speaker 4: my market and you look at some of the levels
Speaker 4: that are available today, super attractive. And if you're going
Speaker 4: to take a CounterPunch at this market and you're going
Speaker 4: to buy something with a little bit of some high
Speaker 4: quality spread, you're going to do something that's not affected
Speaker 4: by global supply chains. What's that essential services immunities.
Speaker 2: He repeated that a number of times, I don't have
Speaker 2: the exact piece in front of me, but he mentioned
Speaker 2: Pat mentioned a New York City muni that has been
Speaker 2: so beat up and he believes it's of quality. He said,
Speaker 2: it's been so beat up it generates a ten percent
Speaker 2: equivalent return in that old triple text free New York state.
Speaker 2: This is single best idea across nation and our commute.
Speaker 2: Thank you so much for listening on YouTube and on
Speaker 2: YouTube podcasts. It is single best idea.