1 00:00:00,240 --> 00:00:10,559 Speaker 1: Bloomberg Audio Studios, podcasts, radio news. You're listening to the 2 00:00:10,600 --> 00:00:14,560 Speaker 1: Bloomberg Intelligence podcast. Catch us live weekdays at ten am 3 00:00:14,600 --> 00:00:17,880 Speaker 1: Eastern on Apple, Cocklay and Android Auto with the Bloomberg 4 00:00:17,920 --> 00:00:21,040 Speaker 1: Business app. Listen on demand wherever you get your podcasts, 5 00:00:21,360 --> 00:00:23,080 Speaker 1: or watch us live on YouTube. 6 00:00:23,720 --> 00:00:25,880 Speaker 2: All right, and what can be I guess another one 7 00:00:25,920 --> 00:00:30,280 Speaker 2: of these circular financing deals in Vidia Corporation today and 8 00:00:30,360 --> 00:00:33,480 Speaker 2: announce it's vested an additional two billion dollars in core 9 00:00:33,600 --> 00:00:37,360 Speaker 2: Weave cloud computing firm and key customer to speed up 10 00:00:37,360 --> 00:00:40,280 Speaker 2: an effort to add more than five gigawats of AI 11 00:00:40,320 --> 00:00:43,360 Speaker 2: computing capacity by twenty thirty. There's a lot going on there. 12 00:00:43,400 --> 00:00:46,000 Speaker 2: Let's check in with anaag Rana. He's a technology analyst 13 00:00:46,000 --> 00:00:48,960 Speaker 2: to Bloomberg Intelligence. An Rok, thanks so much for joining 14 00:00:49,040 --> 00:00:52,520 Speaker 2: us here. What's your reaction to this additional investment buy 15 00:00:52,640 --> 00:00:54,480 Speaker 2: in Nvidia into core Weave. 16 00:00:55,760 --> 00:00:57,560 Speaker 3: Yeah, if you go back in history and see when 17 00:00:57,600 --> 00:01:00,280 Speaker 3: Gorviv was going public, it was having a hot time 18 00:01:00,360 --> 00:01:02,840 Speaker 3: getting a good pricing, and then in Vidia kicking and said, 19 00:01:03,040 --> 00:01:04,399 Speaker 3: you know, we're going to be a part of this 20 00:01:04,440 --> 00:01:07,040 Speaker 3: particular ripo. And I think what's happening here? 21 00:01:07,160 --> 00:01:07,399 Speaker 4: Is this. 22 00:01:07,560 --> 00:01:10,280 Speaker 3: In Vidia is creating the chips, and code Weeve is 23 00:01:10,319 --> 00:01:14,000 Speaker 3: helping them sell the computing using those chips. Two different 24 00:01:14,520 --> 00:01:18,760 Speaker 3: public that's out there now. At this time, Codevieve has 25 00:01:18,800 --> 00:01:21,959 Speaker 3: a massive backlog of orders, but it you know, needs 26 00:01:21,959 --> 00:01:24,720 Speaker 3: to get funding done in order to convert that into 27 00:01:24,800 --> 00:01:27,720 Speaker 3: data centers and then capacity. Now you know, in Vidia 28 00:01:27,800 --> 00:01:30,199 Speaker 3: isn't giving them money straight away, but it's basically saying, 29 00:01:30,240 --> 00:01:32,600 Speaker 3: you know, we have confidence in this in this company, 30 00:01:32,720 --> 00:01:35,840 Speaker 3: and it would help then Code Weeve go out and 31 00:01:35,920 --> 00:01:38,640 Speaker 3: raise capital from outside. So I think it's a little 32 00:01:38,680 --> 00:01:41,960 Speaker 3: bit more like spreading the Nvidia ecosystem, is what that's 33 00:01:41,959 --> 00:01:42,839 Speaker 3: happening right now. 34 00:01:43,120 --> 00:01:47,240 Speaker 2: Looking at your research note, note that corew've has fifty 35 00:01:47,360 --> 00:01:52,000 Speaker 2: billion dollars in remaining performance obligations. What does that mean? 36 00:01:53,120 --> 00:01:55,920 Speaker 3: Yeah, basically it's this is kind of the contracted revenue 37 00:01:55,920 --> 00:01:58,480 Speaker 3: they have on hand, which means, you know, Microsoft has said, 38 00:01:58,480 --> 00:02:00,680 Speaker 3: you know what, I'm good for ten turn out of that. 39 00:02:00,760 --> 00:02:03,680 Speaker 3: For example, Meta has a deal with them, so they 40 00:02:03,760 --> 00:02:06,240 Speaker 3: have this backlog of all these orders. But you know, 41 00:02:06,360 --> 00:02:09,080 Speaker 3: unlike other companies, you just can't go out and fulfill 42 00:02:09,120 --> 00:02:11,520 Speaker 3: the demand. You have to create a very large data 43 00:02:11,560 --> 00:02:15,000 Speaker 3: centers using a radio chips. It then starts to work 44 00:02:15,040 --> 00:02:17,919 Speaker 3: out or runs and then you realize that fifty billion 45 00:02:18,000 --> 00:02:20,359 Speaker 3: into revenue over the next several years. 46 00:02:21,800 --> 00:02:26,320 Speaker 2: So what's the gating issue here for Coreweve? Is it 47 00:02:26,520 --> 00:02:29,160 Speaker 2: more access to more data centers? What's kind of the 48 00:02:29,200 --> 00:02:32,200 Speaker 2: gating issue for them to fulfill that revenue? 49 00:02:33,240 --> 00:02:36,680 Speaker 3: Multiple gating factors. One is actually the data center itself. 50 00:02:36,720 --> 00:02:39,400 Speaker 3: For that, you need land, you need power. You know, 51 00:02:39,440 --> 00:02:41,320 Speaker 3: the chip side is okay at this point because in 52 00:02:41,440 --> 00:02:43,880 Speaker 3: radio is there. But then also you need capital. I 53 00:02:43,919 --> 00:02:46,359 Speaker 3: mean code Weave is not a company like Microsoft or 54 00:02:46,400 --> 00:02:49,760 Speaker 3: Amazon that has unlimited capital to create these data centers. 55 00:02:49,880 --> 00:02:51,840 Speaker 3: It has to go in the market and raise capital. 56 00:02:52,440 --> 00:02:54,840 Speaker 3: Before they went public, I mean their cost of capital 57 00:02:54,919 --> 00:02:58,240 Speaker 3: was north of ten percent. Right now after they went public, 58 00:02:58,280 --> 00:02:59,960 Speaker 3: I mean the cost of capital has gone down to 59 00:03:00,040 --> 00:03:03,160 Speaker 3: about eight percent. But the entire new clouds are in, 60 00:03:03,320 --> 00:03:05,840 Speaker 3: whether it is code we or whether it is Nebus, 61 00:03:06,280 --> 00:03:10,120 Speaker 3: really depends on private credit lending or lending by other 62 00:03:10,840 --> 00:03:13,959 Speaker 3: banks to really come up with the funding to create 63 00:03:13,960 --> 00:03:15,040 Speaker 3: these data centers. 64 00:03:15,720 --> 00:03:19,000 Speaker 2: So I also see in the news here today that 65 00:03:19,160 --> 00:03:23,640 Speaker 2: Microsoft unveil's latest AI chip to reduce reliance on in 66 00:03:23,800 --> 00:03:24,799 Speaker 2: video what's going on there. 67 00:03:26,000 --> 00:03:28,160 Speaker 3: So this is something that's going on with all hyper 68 00:03:28,200 --> 00:03:31,200 Speaker 3: scale cloud providers, you know, whether that's Google with its CPUs, 69 00:03:31,560 --> 00:03:34,960 Speaker 3: Amazon with its chip, and now Microsoft launching. I mean, 70 00:03:35,000 --> 00:03:37,400 Speaker 3: they have one chip, but the first generation was not 71 00:03:38,040 --> 00:03:40,360 Speaker 3: you could say, did not do that well in terms 72 00:03:40,480 --> 00:03:43,960 Speaker 3: of you know, reception from customers. What Microsoft is hoping 73 00:03:44,000 --> 00:03:46,360 Speaker 3: here right now is, you know, for training, they'll still 74 00:03:46,480 --> 00:03:50,200 Speaker 3: use the more powerful in video chips, but for you know, running, 75 00:03:50,280 --> 00:03:53,160 Speaker 3: let's say a copilot, they could get around and use 76 00:03:53,640 --> 00:03:56,080 Speaker 3: less powerful chips and big band. If they do that, 77 00:03:56,240 --> 00:03:57,240 Speaker 3: they actually save. 78 00:03:57,160 --> 00:03:58,080 Speaker 5: A lot of money. 79 00:03:58,280 --> 00:04:00,920 Speaker 3: You know, in our math, we think if if Microsoft 80 00:04:00,960 --> 00:04:03,080 Speaker 3: is going to spend you know, somewhere north of one 81 00:04:03,120 --> 00:04:05,840 Speaker 3: hundred and forty billion dollars this year, more than fifty 82 00:04:05,880 --> 00:04:07,920 Speaker 3: of that is going to go just buying chips, and 83 00:04:07,960 --> 00:04:10,120 Speaker 3: so you know, it's it's a very big ticket for 84 00:04:10,200 --> 00:04:12,960 Speaker 3: them and they everybody needs to be doing this frankly 85 00:04:13,000 --> 00:04:13,440 Speaker 3: in house. 86 00:04:14,280 --> 00:04:16,080 Speaker 2: So what's the next thing we should be looking for? 87 00:04:16,200 --> 00:04:18,600 Speaker 2: We get earnings coming up this week. An Aaraj just 88 00:04:18,640 --> 00:04:21,320 Speaker 2: gives a little preview kind of what you think the 89 00:04:21,360 --> 00:04:23,360 Speaker 2: market's keying on this time around. 90 00:04:24,800 --> 00:04:26,600 Speaker 3: The biggest thing we want to know is where are 91 00:04:26,600 --> 00:04:29,279 Speaker 3: the use cases, what kind of AI adoption we are 92 00:04:29,320 --> 00:04:32,680 Speaker 3: seeing across different sectors, And that's I think was going 93 00:04:32,720 --> 00:04:35,320 Speaker 3: to probably be the most important thing for us. We 94 00:04:35,400 --> 00:04:39,039 Speaker 3: have already seen that infrastructure spending is very high. Everybody 95 00:04:39,080 --> 00:04:42,400 Speaker 3: has that big AI factory in place, but is the 96 00:04:42,520 --> 00:04:47,160 Speaker 3: demand coming from you know, non LLLM customers to deploy 97 00:04:47,200 --> 00:04:49,280 Speaker 3: those And that's really I think that one of the 98 00:04:49,279 --> 00:04:52,200 Speaker 3: biggest focus areas for us going into this earning season 99 00:04:52,400 --> 00:04:54,000 Speaker 3: and probably all of twenty twenty six. 100 00:04:55,320 --> 00:04:58,120 Speaker 2: So what's the what do you think is the best 101 00:04:58,400 --> 00:05:01,880 Speaker 2: positioned kind of the big tech names that you follow 102 00:05:01,920 --> 00:05:05,400 Speaker 2: for twenty twenty six year, because there's probably as much 103 00:05:05,440 --> 00:05:07,400 Speaker 2: concern in the marketplace that this could be a year 104 00:05:07,440 --> 00:05:09,800 Speaker 2: where the AI story begins to disappoint. 105 00:05:09,800 --> 00:05:10,240 Speaker 4: Perhaps. 106 00:05:11,480 --> 00:05:13,440 Speaker 3: Yeah, I mean, if you think about it, the three 107 00:05:13,800 --> 00:05:17,880 Speaker 3: companies that are probably most i mean better position than 108 00:05:17,920 --> 00:05:21,920 Speaker 3: the others are really Microsoft, Google and Amazon, because not 109 00:05:22,040 --> 00:05:25,960 Speaker 3: only do they have an emerging AI infrastructure business, but 110 00:05:26,080 --> 00:05:28,960 Speaker 3: they also have a legacy cloud business. And one of 111 00:05:28,960 --> 00:05:31,960 Speaker 3: the ways you deploy this technology is using cloud. So 112 00:05:32,200 --> 00:05:35,279 Speaker 3: if you're building an application using one of the lllms, 113 00:05:35,320 --> 00:05:37,680 Speaker 3: you're hosting it in one of these cloud providers, and 114 00:05:37,720 --> 00:05:40,680 Speaker 3: we've already seen that and improvement in growth rates for 115 00:05:40,960 --> 00:05:43,480 Speaker 3: Microsoft and Google, and I think this year we see 116 00:05:43,520 --> 00:05:45,880 Speaker 3: that improvement coming in for Amazon as well. 117 00:05:46,480 --> 00:05:49,640 Speaker 2: Stay with us more from Bloomberg Intelligence coming up after this. 118 00:05:53,480 --> 00:05:57,160 Speaker 1: You're listening to the Bloomberg Intelligence podcast. Catch us live 119 00:05:57,240 --> 00:06:00,360 Speaker 1: weekdays at ten am Eastern on Apple, Cocklay and Android 120 00:06:00,360 --> 00:06:03,679 Speaker 1: Otto with the Bluemberg Business app. Listen on demand wherever 121 00:06:03,720 --> 00:06:06,839 Speaker 1: you get your podcasts, or watch us live on YouTube. 122 00:06:07,680 --> 00:06:10,240 Speaker 2: Let's redrive into your little healthcare here we can check 123 00:06:10,240 --> 00:06:14,800 Speaker 2: in with Sam Fizzelli joins us in Bloomberg Intelligence. He's 124 00:06:14,839 --> 00:06:18,799 Speaker 2: over there in London covering all the healthcare stuff for us. Sam, 125 00:06:19,240 --> 00:06:21,440 Speaker 2: what's front of mine as you go into earning season 126 00:06:21,640 --> 00:06:24,200 Speaker 2: this season for investors in some of the biotech and 127 00:06:24,880 --> 00:06:26,360 Speaker 2: big cap big farmer companies. 128 00:06:27,760 --> 00:06:30,599 Speaker 6: Yeah, so, Paul, I think what people hope to hear 129 00:06:30,600 --> 00:06:33,360 Speaker 6: and expect to hear is that all that MFN stuff 130 00:06:33,440 --> 00:06:37,520 Speaker 6: is behind us, All the negotiations have happened. They're not 131 00:06:37,560 --> 00:06:40,640 Speaker 6: worried about any any talk of it anymore. And of 132 00:06:40,680 --> 00:06:44,280 Speaker 6: course what people are also looking for is what farmer 133 00:06:44,400 --> 00:06:48,039 Speaker 6: is doing. Looking into twenty eight twenty nine thirty with 134 00:06:48,279 --> 00:06:52,360 Speaker 6: some patent expiies. How good does their pipeline looking? Are 135 00:06:52,400 --> 00:06:56,440 Speaker 6: they still solidly behind it? It's a tid have any 136 00:06:57,080 --> 00:07:00,360 Speaker 6: negative things to day the pipeline and also listen out 137 00:07:00,360 --> 00:07:02,880 Speaker 6: for m and A right MNA is what there this 138 00:07:03,040 --> 00:07:05,200 Speaker 6: solution to some of these issues they might have with 139 00:07:05,279 --> 00:07:09,280 Speaker 6: their patents are and thatfore that's what biotech investors are 140 00:07:09,279 --> 00:07:12,640 Speaker 6: looking for in terms of what are the kinds of commentary. 141 00:07:12,840 --> 00:07:16,440 Speaker 6: Remember or we just had this up and down yo 142 00:07:16,520 --> 00:07:19,880 Speaker 6: yo with Revolution Medicine share price where there was a 143 00:07:19,960 --> 00:07:21,960 Speaker 6: rumor that Merk might be wanting to buy them, and 144 00:07:22,040 --> 00:07:23,960 Speaker 6: a JP Morgan they said, look, we got tens of 145 00:07:23,960 --> 00:07:25,960 Speaker 6: billions of dollars to put to work. And of course 146 00:07:26,360 --> 00:07:28,160 Speaker 6: that's a sort of number that people were thinking about 147 00:07:28,200 --> 00:07:31,440 Speaker 6: Revolution Medicine and apparently they've walked away from each other. 148 00:07:31,480 --> 00:07:33,280 Speaker 6: So we've done a lot of analysis on that. But 149 00:07:33,320 --> 00:07:34,560 Speaker 6: that's the sort of thing people are going to be 150 00:07:34,640 --> 00:07:35,120 Speaker 6: looking for. 151 00:07:36,400 --> 00:07:38,800 Speaker 5: I didn't realize that Mark was this price sensitive. 152 00:07:38,840 --> 00:07:41,880 Speaker 7: I mean, how how much more particular how much more 153 00:07:42,880 --> 00:07:46,040 Speaker 7: price sensitive are these big tech not big tech sorry 154 00:07:46,080 --> 00:07:47,560 Speaker 7: there In a way they're kind of like tech companies, 155 00:07:47,560 --> 00:07:50,120 Speaker 7: big pharmer companies going to be at this stage of 156 00:07:50,240 --> 00:07:50,440 Speaker 7: M and A. 157 00:07:51,800 --> 00:07:54,680 Speaker 6: Yeah, I mean there's price and price though, right. I mean, 158 00:07:55,240 --> 00:07:58,240 Speaker 6: what we calculated here is that at about a thirty 159 00:07:58,280 --> 00:08:03,760 Speaker 6: billion dollar value for Revolution Medicines. The only way it 160 00:08:03,760 --> 00:08:07,080 Speaker 6: would have worked is if you had the largest number 161 00:08:07,160 --> 00:08:09,040 Speaker 6: that we might be out there already with in terms 162 00:08:09,080 --> 00:08:12,240 Speaker 6: of sales going out to twenty thirty five, and assume 163 00:08:12,480 --> 00:08:16,960 Speaker 6: a massive cash generation out of that, something in the 164 00:08:16,960 --> 00:08:21,559 Speaker 6: region of sixty seventy eighty percent cash conversion doable. Novel 165 00:08:21,680 --> 00:08:24,480 Speaker 6: had a few years of having like almost one hundred 166 00:08:24,480 --> 00:08:28,000 Speaker 6: percent cash conversion. The point is that doesn't usually work 167 00:08:28,200 --> 00:08:30,720 Speaker 6: a in a standard farmer company. So we just thought 168 00:08:30,760 --> 00:08:33,080 Speaker 6: that number was too much, and it turns out to 169 00:08:33,120 --> 00:08:36,480 Speaker 6: be what the company came out, not too much, but 170 00:08:36,559 --> 00:08:39,640 Speaker 6: too hard to justify. I mean, Revolution Medicine is a 171 00:08:39,679 --> 00:08:43,720 Speaker 6: classy company, it's got a great pipeline. Probably it's got 172 00:08:43,760 --> 00:08:47,200 Speaker 6: to change the fate of many people with pacreatic cancer. 173 00:08:47,240 --> 00:08:49,040 Speaker 6: We'll have to wait and see the data. So there's 174 00:08:49,080 --> 00:08:51,800 Speaker 6: a lot going for them, but price sensitivity, and we've 175 00:08:51,800 --> 00:08:53,800 Speaker 6: thirty billion dollars a small amount of money. 176 00:08:55,280 --> 00:08:56,920 Speaker 2: M and A in twenty twenty six am so we 177 00:08:56,960 --> 00:09:00,000 Speaker 2: expect it to be another robust year in the healthcare space. 178 00:09:00,040 --> 00:09:03,439 Speaker 6: Yeah, yeah, yeah. I mean biotech was pretty good last 179 00:09:03,520 --> 00:09:05,720 Speaker 6: year in terms of farmer buying them and some biotech 180 00:09:05,800 --> 00:09:08,559 Speaker 6: buying each other. We had gen Map buying mirrors, so 181 00:09:08,679 --> 00:09:10,440 Speaker 6: I think that would be still the case. Whether this 182 00:09:10,520 --> 00:09:13,000 Speaker 6: stal happens or not, whether it happens at one hundred 183 00:09:13,040 --> 00:09:15,680 Speaker 6: and ten dollars a share or whatever, or never happens. 184 00:09:16,000 --> 00:09:18,920 Speaker 6: There's plenty of food assets out there. What also we're 185 00:09:18,920 --> 00:09:22,000 Speaker 6: looking at for twenty twenty six is IPOs. We've had 186 00:09:22,040 --> 00:09:26,640 Speaker 6: a couple already holding above the issue price, and I 187 00:09:26,640 --> 00:09:28,800 Speaker 6: think people are hoping maybe we get twenty to twenty 188 00:09:28,840 --> 00:09:30,960 Speaker 6: five IPOs in twenty twenty six. 189 00:09:32,120 --> 00:09:32,719 Speaker 5: Stay with us. 190 00:09:32,920 --> 00:09:35,280 Speaker 2: More from Bloomberg Intelligence coming up after this. 191 00:09:39,160 --> 00:09:42,880 Speaker 1: You're listening to the Bloomberg Intelligence podcast. Catch us live 192 00:09:42,960 --> 00:09:46,040 Speaker 1: weekdays at ten am easterne on Apple, Cocklay and Android 193 00:09:46,040 --> 00:09:49,360 Speaker 1: Otto with the Bloomberg Business app. Listen on demand wherever 194 00:09:49,400 --> 00:09:52,520 Speaker 1: you get your podcasts, or watch us live on YouTube. 195 00:09:53,280 --> 00:09:55,720 Speaker 7: David Wu has been one of my favorite guests for years. 196 00:09:55,760 --> 00:09:58,880 Speaker 7: He was the head of inter interest rates and Economic 197 00:09:58,960 --> 00:10:02,240 Speaker 7: research at BAVA for many many years. One of our 198 00:10:02,840 --> 00:10:05,680 Speaker 7: long term guests, and then he retired. He had told 199 00:10:05,679 --> 00:10:07,360 Speaker 7: me even before he retired that he was planning to 200 00:10:07,360 --> 00:10:09,480 Speaker 7: write a book. And this book is now about to 201 00:10:09,520 --> 00:10:10,160 Speaker 7: be published. 202 00:10:10,400 --> 00:10:12,160 Speaker 5: So David Wu joins us right now. 203 00:10:12,200 --> 00:10:15,240 Speaker 7: He is a founder of strategist of Unbound Retail on 204 00:10:15,320 --> 00:10:18,000 Speaker 7: his new book, Mary Go Round Broke Down, a novel 205 00:10:18,000 --> 00:10:19,840 Speaker 7: of guilt, greed and globalization. 206 00:10:20,240 --> 00:10:21,600 Speaker 5: David, good to speak with you. 207 00:10:21,400 --> 00:10:23,720 Speaker 7: You now live in Israel, You've written this book, it's 208 00:10:23,760 --> 00:10:26,840 Speaker 7: about to be published. Except the world is very different 209 00:10:26,880 --> 00:10:29,760 Speaker 7: than what it was when you first started writing this book. 210 00:10:30,080 --> 00:10:33,520 Speaker 5: What stage of globalization are we at right now? Isn't 211 00:10:33,559 --> 00:10:34,760 Speaker 5: it just deglobalization? 212 00:10:36,480 --> 00:10:39,520 Speaker 4: I think, you know, honestly, Scarlett, I think is as 213 00:10:39,559 --> 00:10:43,319 Speaker 4: dead as Dodo actually. And the way I look at 214 00:10:43,320 --> 00:10:46,360 Speaker 4: this is that I'm just hoping and I know it's over. 215 00:10:46,920 --> 00:10:49,480 Speaker 4: I'm just hoping that, you know, we're not going to 216 00:10:49,480 --> 00:10:51,200 Speaker 4: throw out the baby with the bath water. And this 217 00:10:51,280 --> 00:10:52,760 Speaker 4: is the reason why I wrote the book, by the way, 218 00:10:52,960 --> 00:10:55,959 Speaker 4: because I now want to basically take the war the 219 00:10:56,000 --> 00:10:59,679 Speaker 4: battle organization to the general public. This is why I 220 00:10:59,679 --> 00:11:02,280 Speaker 4: wrote it as a novel as opposed to another policy book, 221 00:11:02,320 --> 00:11:04,720 Speaker 4: because I want to basically explain I want to basically 222 00:11:04,720 --> 00:11:07,960 Speaker 4: make accessible the story of globalization to every person in 223 00:11:08,000 --> 00:11:10,840 Speaker 4: the stry, regardless their background, so that we can make 224 00:11:10,840 --> 00:11:13,040 Speaker 4: a decision about which part we want to keep and 225 00:11:13,080 --> 00:11:15,560 Speaker 4: which part we want to part with. So that that's 226 00:11:15,600 --> 00:11:18,040 Speaker 4: really the purpose of the book, because I think, you know, 227 00:11:18,280 --> 00:11:20,120 Speaker 4: to be honest with you, I think for the world 228 00:11:20,120 --> 00:11:22,760 Speaker 4: to be a better place, there's never been more important 229 00:11:22,840 --> 00:11:26,240 Speaker 4: for everybody. I'm talking about everybody to understand the workings 230 00:11:26,280 --> 00:11:26,760 Speaker 4: of the world. 231 00:11:27,520 --> 00:11:30,559 Speaker 2: So David, to the extent that globalization is at the 232 00:11:30,720 --> 00:11:34,760 Speaker 2: very least losing prominence in global trades, some people would 233 00:11:34,760 --> 00:11:37,520 Speaker 2: say the ear of globalization is over. I don't know 234 00:11:38,520 --> 00:11:42,080 Speaker 2: what's changed in the last several years, because it really 235 00:11:42,120 --> 00:11:44,839 Speaker 2: seemed to be on a post World War two pretty 236 00:11:44,920 --> 00:11:47,040 Speaker 2: solid trajectory, right. 237 00:11:47,520 --> 00:11:49,440 Speaker 4: I think for the most part, I think, you know, 238 00:11:49,559 --> 00:11:53,000 Speaker 4: the honest truth is if you look at what's going on, right, 239 00:11:53,040 --> 00:11:56,079 Speaker 4: I mean, we all knew the US has not only 240 00:11:56,120 --> 00:11:59,559 Speaker 4: been the guaranteur of the root based global order that 241 00:11:59,600 --> 00:12:02,080 Speaker 4: it's been in place for whatever seventy years, let's call 242 00:12:02,080 --> 00:12:04,800 Speaker 4: it dapts, right, and the US has also been, you know, 243 00:12:04,840 --> 00:12:08,280 Speaker 4: the biggest beneficiary. Now, so the question is why all 244 00:12:08,280 --> 00:12:10,440 Speaker 4: of a sudden, the US wants to walk away from 245 00:12:10,559 --> 00:12:13,520 Speaker 4: this root based order. I think the answer is pretty obvious, 246 00:12:13,720 --> 00:12:16,440 Speaker 4: which is that the US was the main beneficiary as 247 00:12:16,520 --> 00:12:20,320 Speaker 4: long as the US economic and military domination was total, 248 00:12:21,080 --> 00:12:23,280 Speaker 4: and it's become very clear that this is no longer 249 00:12:23,320 --> 00:12:26,680 Speaker 4: the case. And therefore the US decided that, you know what, 250 00:12:26,880 --> 00:12:29,800 Speaker 4: we want to be able to reposition ourselves in a 251 00:12:29,840 --> 00:12:32,360 Speaker 4: competitive way. This is why we want to basically do 252 00:12:32,400 --> 00:12:34,600 Speaker 4: away with the rules. And this is why, in a way, 253 00:12:34,880 --> 00:12:39,160 Speaker 4: you know, the I mean, the whole Medora's extraction from Venezuela, 254 00:12:39,200 --> 00:12:40,800 Speaker 4: it was not about the US is trying to go 255 00:12:40,840 --> 00:12:44,240 Speaker 4: down to Venezuela to promote democracy. I mean, this is 256 00:12:44,280 --> 00:12:47,319 Speaker 4: really about an oil grab. It's about the US. I mean, 257 00:12:47,440 --> 00:12:50,400 Speaker 4: it's China no longer the US that is the dominant 258 00:12:50,600 --> 00:12:53,880 Speaker 4: trading partner for South America, the biggest sovereign lender, and 259 00:12:53,960 --> 00:12:56,360 Speaker 4: then US decided that's it, that's what we're going to do. 260 00:12:56,600 --> 00:12:58,840 Speaker 4: So I think, not point of view, this is what 261 00:12:58,920 --> 00:13:01,559 Speaker 4: it is. I mean, it's not about globalization or not. 262 00:13:01,800 --> 00:13:04,440 Speaker 4: It's about the global you know. I mean, I think 263 00:13:04,440 --> 00:13:07,720 Speaker 4: it's about the group based international order that has come 264 00:13:07,760 --> 00:13:11,280 Speaker 4: to an end. I mean, I'm sympathetic to the view 265 00:13:11,600 --> 00:13:14,600 Speaker 4: of you know, Mark Karney, who declare it this thing. 266 00:13:14,520 --> 00:13:15,760 Speaker 5: Is over right. 267 00:13:15,800 --> 00:13:18,079 Speaker 7: And to the US's credit or to President Trump's credit, 268 00:13:18,200 --> 00:13:21,679 Speaker 7: he never pretended that this was about promoting democracy in Venezuela. Right, 269 00:13:21,679 --> 00:13:24,120 Speaker 7: It was always about oil, and he was pretty upfront 270 00:13:24,160 --> 00:13:26,840 Speaker 7: about that. So in your book, David Merry, Go Around, 271 00:13:26,840 --> 00:13:28,880 Speaker 7: Broke Down, you have a number of different characters to 272 00:13:28,960 --> 00:13:32,160 Speaker 7: really tell the story of globalization from their perspective. There's 273 00:13:32,200 --> 00:13:35,320 Speaker 7: a director of a failing factory in China, a trader 274 00:13:35,360 --> 00:13:38,480 Speaker 7: in London, a Japanese housewife who learns and. 275 00:13:38,400 --> 00:13:39,839 Speaker 5: Perfects the yen carry trade. 276 00:13:39,880 --> 00:13:42,839 Speaker 7: A Mexican artist who becomes an undocumented worker in the US. 277 00:13:43,720 --> 00:13:46,880 Speaker 7: Which is your favorite first of all to write about, 278 00:13:47,160 --> 00:13:49,680 Speaker 7: Which is the one that you think can survive in 279 00:13:49,760 --> 00:13:52,800 Speaker 7: this next stage of globalization slash d globalization? 280 00:13:54,120 --> 00:13:56,320 Speaker 4: You know, the honest truth is and I'm embarrassed to 281 00:13:56,320 --> 00:13:58,120 Speaker 4: say this is of course the hedgeflon manager. 282 00:13:58,400 --> 00:14:01,640 Speaker 5: I knew it said in a way it's very sad. 283 00:14:01,760 --> 00:14:03,000 Speaker 4: It's very sad. I mean, this is what we have 284 00:14:03,040 --> 00:14:05,840 Speaker 4: a K shape economy right now. You know, people the 285 00:14:05,920 --> 00:14:07,960 Speaker 4: world could be going to para shape, but somebody is 286 00:14:07,960 --> 00:14:10,400 Speaker 4: gonna make some money basically on their way down. And 287 00:14:10,440 --> 00:14:12,600 Speaker 4: that's what it is. I mean, this is why, like 288 00:14:12,679 --> 00:14:15,080 Speaker 4: you know, I think, not put of view, it's actually 289 00:14:15,160 --> 00:14:18,520 Speaker 4: the financialization of a global crisis that's making a lot 290 00:14:18,559 --> 00:14:21,360 Speaker 4: of people very rich. And I'm not just talking about obviously, 291 00:14:21,440 --> 00:14:24,000 Speaker 4: you know, the hedge funds, whatever. I mean, everybody's trying 292 00:14:24,040 --> 00:14:26,800 Speaker 4: to milk this cow because what is really going on. 293 00:14:27,040 --> 00:14:30,640 Speaker 4: Also part of this is that ironically, you know, as 294 00:14:30,680 --> 00:14:35,480 Speaker 4: Trump tries to dismantle the order his the only thing 295 00:14:35,520 --> 00:14:38,560 Speaker 4: that he cannot dismantle is the stock market. That's the 296 00:14:38,680 --> 00:14:41,240 Speaker 4: honest true. This is why talk is taking Trump less 297 00:14:41,240 --> 00:14:43,680 Speaker 4: and less time to taco and because at the end 298 00:14:43,760 --> 00:14:45,800 Speaker 4: the day, for him to go out there and win 299 00:14:45,880 --> 00:14:48,520 Speaker 4: trade wars, he needs the U s stock market to cooperate. 300 00:14:48,680 --> 00:14:50,880 Speaker 4: I mean, the honest truth is if the US economy 301 00:14:50,880 --> 00:14:53,040 Speaker 4: would have gone into a recession last year if it 302 00:14:53,080 --> 00:14:56,200 Speaker 4: hadn't been for the stock market. So not put of view, like, 303 00:14:56,320 --> 00:14:58,080 Speaker 4: that's just what it is. And so people get it. 304 00:14:58,160 --> 00:15:00,640 Speaker 4: People get it. This is why every everybody and their 305 00:15:00,640 --> 00:15:04,360 Speaker 4: grandmother's overweight stocks. Everybody in the grandmother's overweight goal, so 306 00:15:04,440 --> 00:15:07,440 Speaker 4: basically buying stocks and buying gold has become the Trump 307 00:15:07,520 --> 00:15:10,400 Speaker 4: traits of basically a second term, and it's about how 308 00:15:10,440 --> 00:15:13,160 Speaker 4: he's going to dismantle the world, but he has to 309 00:15:13,200 --> 00:15:16,600 Speaker 4: tackle when the stock market even has a little basically 310 00:15:16,880 --> 00:15:18,120 Speaker 4: coughing context. 311 00:15:18,400 --> 00:15:23,080 Speaker 1: This is the Bloomberg Intelligence Podcast, available on Apple, Spotify, 312 00:15:23,280 --> 00:15:26,760 Speaker 1: and anywhere else you get your podcasts. Listen live each 313 00:15:26,760 --> 00:15:30,520 Speaker 1: weekday ten am to noon Eastern on Bloomberg dot com, 314 00:15:30,640 --> 00:15:34,160 Speaker 1: the iHeartRadio app tune In, and the Bloomberg Business app. 315 00:15:34,600 --> 00:15:37,560 Speaker 1: You can also watch us live every weekday on YouTube 316 00:15:37,920 --> 00:15:40,160 Speaker 1: and always on the Bloomberg terminal