Speaker 1: Bloomberg Audio Studios, Podcasts, radio news.
Speaker 2: Single best idea on an Apple podcast it's a six
Speaker 2: minute extravaganza, sometimes five, sometimes seven minutes. Today it could
Speaker 2: be fifteen minutes. We'd bore you to death, but we
Speaker 2: thank you for choosing a single best idea where we
Speaker 2: really focus on two voices. We had such a strong
Speaker 2: morning that we're gonna give you a bonus today. Michael
Speaker 2: Nathanson will come along here with piercing comments on the
Speaker 2: Olympics coming up. We're making jokes about it, but it's
Speaker 2: not funny. There's billions of dollars involved. You're going to
Speaker 2: just be stunned at what Nathanson says. First, so on
Speaker 2: CPI and how the Federal Reserve system will react to it.
Speaker 2: A former governor of the Fed, Randall Krasner, he is
Speaker 2: with at Chicago RAGU Rajin our leading financial economists there's
Speaker 2: out of Brown University and go Wood, New Jersey, and
Speaker 2: he's just absolutely definitive on the nuances. The path, an
Speaker 2: old path is you just make it up as you go.
Speaker 2: About thirty years ago, Alan Greenspan codified measured and that
Speaker 2: you would get on a path and you'd stay on
Speaker 2: a path in a measured way. Randy Krosner of the
Speaker 2: Boost School Chicago on green spans measured, I don't.
Speaker 3: Think they're going to do the measured pace.
Speaker 4: I think there was pretty clear consensus even when I
Speaker 4: was there, which is now a while ago, that measured
Speaker 4: pace was not the best way to do things.
Speaker 3: And so I think that they will move.
Speaker 4: And you can see when they moved in place interest
Speaker 4: rates up that was not at a measured pace. That
Speaker 4: was pretty rapid. So I think they're gonna they'll bring
Speaker 4: interest rates down. I think they'll bring them down somewhat
Speaker 4: gradually at first, but if they see the libor market
Speaker 4: really weakening, they'll start to move quickly. That'll be too
Speaker 4: late to prevent the labor market from softenings substantially.
Speaker 3: But they have to weigh the risks.
Speaker 4: Of calling all clear too early, getting back into what
Speaker 4: happened in the late seventies early eighties where they did
Speaker 4: that and then inflation reignited and they had to raise
Speaker 4: rates really high, had a really bad recession.
Speaker 3: They'd rather wait a little bit, you.
Speaker 4: Know, perhaps a little bit too long, to buy some
Speaker 4: insurance against that upside inflation scenario.
Speaker 3: But then they can cut and just have.
Speaker 4: A slowdown, maybe a mild recession, but something that'd be
Speaker 4: much less worse than what they had in the early.
Speaker 2: Eighties, maybe a soft land. And there Randy Krassner, the
Speaker 2: Booth School of Chicago, And of course what does all
Speaker 2: this mean over the markets, Well, it meant price up,
Speaker 2: yield down, the real yield. I watch carefully the inflation
Speaker 2: adjust a ten year yield one measure of that idea,
Speaker 2: and the real yield really broke below range the range
Speaker 2: that I look at. The series I look at had
Speaker 2: a bottom range of about one point ninety six percent,
Speaker 2: and we plug ung below that down to one point
Speaker 2: nine zero with a shock of a negative statistic on
Speaker 2: one measure of CPI month over month, I think headline
Speaker 2: CPI and it came back a little bit one point
Speaker 2: ninety five percent, but we've decisively moved to the tippy
Speaker 2: edge of the range or even lower in yield. That's
Speaker 2: one of those ideas of disinflation. And then what it
Speaker 2: means over to a market that just won't go down
Speaker 2: Every afternoon. I watched the market take a bid at
Speaker 2: two thirty PM, even more of a bid at three
Speaker 2: point thirty. You look at the character of this bull market.
Speaker 2: You try to look back at what the pros call
Speaker 2: an analog, what was this bullmarket? Like Kate Moore of Blackrock.
Speaker 5: I don't see a perfect analog right here. And I
Speaker 5: know everyone wants to pick a period in history and
Speaker 5: say it looks just like this, and it's a comfort.
Speaker 5: You know, people like that comfort. But we are in
Speaker 5: the midst of, I think a massive technological change here
Speaker 5: with the advent of AI and as companies trying for
Speaker 5: you out how to adopt AI and figure out the
Speaker 5: use cases and what the best way to work with
Speaker 5: this technology is, and I think that's going to lead
Speaker 5: to these incredible bifurcation in the market. Companies that have
Speaker 5: access to the technology have access to amazing data sets
Speaker 5: and are using it appropriately, and those that don't. You're
Speaker 5: starting to see that separation in earnings already. And I
Speaker 5: just don't know that we, or at least in the
Speaker 5: lifetime I've been in almost five decades, that we've seen
Speaker 5: this significant of a technological change.
Speaker 2: Kate Moore of black Rock. Huge debate there. Michael Darta
Speaker 2: was really strong today and the idea of nominal GDP
Speaker 2: is going to come down, and he's looking at some
Speaker 2: serious recession tendencies within the market. He made very clear
Speaker 2: this is a central bank fighting the last war. One
Speaker 2: of the things we follow, and it's a real effort
Speaker 2: at Paul Sweeney. As the entertainment business, the zaniness we
Speaker 2: see in streaming, I don't know. I try to cancel
Speaker 2: a streamer once every two weeks. I try to camp
Speaker 2: so someone just as a good habit, and you try
Speaker 2: to add up what you've got, but you don't know
Speaker 2: what you're paying. Some of them they're like fifteen dollars
Speaker 2: a month, but you can get it specially for six
Speaker 2: dollars ninety five. It's a nuts business and the heart
Speaker 2: of that is sports will make it. And Michael Nathanson
Speaker 2: was on today of Moffatt Nathanson There absolutely definitive in entertainment.
Speaker 2: They put out a twenty page report on cable TV
Speaker 2: or cell phones or the entertainment the content that Michael follows,
Speaker 2: everybody reads. It's hugely influential. And I set them up
Speaker 2: with a question on the Olympics with NBC coming in
Speaker 2: at one point two billion dollar large, everything's sold out.
Speaker 2: It's all great. Da da da da da, And I
Speaker 2: was thunderstruck at this guy with a lot of experience.
Speaker 2: Michael Nathanson on the extravaganza in Paris.
Speaker 1: I think the Olympic moment has passed us by.
Speaker 3: I really do.
Speaker 1: I think last time we talked with this previous Olympics
Speaker 1: part of the problem is you don't know where to
Speaker 1: find it. You know it's on Peacock and they've spread
Speaker 1: it all out, and you know, sometimes the games are
Speaker 1: in real time, so you know you're not in front
Speaker 1: of the set or for your computer when things are happening.
Speaker 4: I don't know.
Speaker 1: I think, especially in European time zones, it's not ideal.
Speaker 1: So I say to you, I'm more embarrassing Olympics and
Speaker 1: other sports at this point in time.
Speaker 2: Stunning from Michael Nathanson. That's single best idea for today. Again.
Speaker 2: We're out on I was gonna say we're out on Netflix.
Speaker 2: I'm thinking Nathan Si, No, folks, we're not out on Netflix.
Speaker 2: I miss book. We're out on YouTube, which I think
Speaker 2: is going to be bigger than Netflix based on what
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