1 00:00:02,400 --> 00:00:06,760 Speaker 1: Bloomberg Audio Studios, Podcasts, radio news. 2 00:00:11,680 --> 00:00:15,480 Speaker 2: This is the Bloomberg Surveillance Podcast. I'm Jonathan Ferrow, along 3 00:00:15,520 --> 00:00:18,720 Speaker 2: with Lisa Bromwitz and Amerie Hordert. Join us each day 4 00:00:18,760 --> 00:00:22,280 Speaker 2: for insight from the best in markets, economics, and geopolitics 5 00:00:22,440 --> 00:00:24,880 Speaker 2: from our global headquarters in New York City. We are 6 00:00:24,960 --> 00:00:27,680 Speaker 2: live on Bloomberg Television weekday mornings from six to nine 7 00:00:27,720 --> 00:00:31,319 Speaker 2: am Eastern. Subscribe to the podcast on Apple, Spotify or 8 00:00:31,320 --> 00:00:33,960 Speaker 2: anywhere else you listen, and as always on the Bloomberg 9 00:00:34,040 --> 00:00:35,880 Speaker 2: terminal and the Bloomberg Business app. 10 00:00:36,600 --> 00:00:37,920 Speaker 3: So here's the laces this morning. 11 00:00:38,000 --> 00:00:41,120 Speaker 2: Areas reporting at earning speed, highlighting another record quarter of 12 00:00:41,159 --> 00:00:44,320 Speaker 2: fundraising with over thirty six billion dollars of inflows. The CEO, 13 00:00:44,640 --> 00:00:47,760 Speaker 2: Mike karraghetti writing, our clients continue to reward us due 14 00:00:47,800 --> 00:00:51,560 Speaker 2: to our strong and consistent fun performance across our strategies. 15 00:00:51,600 --> 00:00:53,680 Speaker 2: Mike joins us now in a studio for more. Mike 16 00:00:53,720 --> 00:00:54,200 Speaker 2: and morning, good to. 17 00:00:54,160 --> 00:00:55,240 Speaker 3: See you, Good morning, Good morning. 18 00:00:55,360 --> 00:00:56,880 Speaker 2: I wanted to start with a quite of yours from 19 00:00:56,920 --> 00:00:59,560 Speaker 2: earlier this year when things were pretty difficult with the 20 00:00:59,560 --> 00:01:01,960 Speaker 2: software issue, and you said something really important. You said 21 00:01:01,960 --> 00:01:04,120 Speaker 2: the following, if you're going to under write a narrative 22 00:01:04,160 --> 00:01:07,000 Speaker 2: of AI disruption, you also then have to say, well, 23 00:01:07,200 --> 00:01:09,560 Speaker 2: what does that mean for the productivity and margin improvement 24 00:01:10,040 --> 00:01:12,120 Speaker 2: for the rest of your book. I think that's a 25 00:01:12,160 --> 00:01:14,360 Speaker 2: good place to start. Where are you seeing value being 26 00:01:14,400 --> 00:01:15,640 Speaker 2: created right now? 27 00:01:15,840 --> 00:01:17,400 Speaker 3: It's I'm glad I said that. 28 00:01:18,680 --> 00:01:20,920 Speaker 4: So if you look at the way that ARIES is 29 00:01:20,920 --> 00:01:25,880 Speaker 4: playing the AI transformation, it's what are we doing within 30 00:01:25,959 --> 00:01:29,640 Speaker 4: the data center and digital infrastructure space, what are we 31 00:01:29,720 --> 00:01:33,840 Speaker 4: doing within our portfolio companies, and what's that productivity uplift? 32 00:01:33,880 --> 00:01:36,640 Speaker 4: And then what are we doing within ARES proper to 33 00:01:36,720 --> 00:01:40,400 Speaker 4: either improve our investment outcomes or profitability. 34 00:01:40,760 --> 00:01:43,000 Speaker 3: So if you start with ARES first. 35 00:01:42,720 --> 00:01:47,039 Speaker 4: We're obviously deploying AI across the entire enterprise. We're seeing 36 00:01:47,080 --> 00:01:50,080 Speaker 4: significant efficiency. We had one hundred basis point margin increase 37 00:01:50,120 --> 00:01:52,920 Speaker 4: in the quarter year over year, and we've guided the 38 00:01:52,920 --> 00:01:55,200 Speaker 4: street to expect zero to one hundred and fifty basis 39 00:01:55,200 --> 00:01:58,440 Speaker 4: points per annum. A fair amount of that is technology 40 00:01:58,480 --> 00:02:03,640 Speaker 4: efficiency that's getting created, reunderwriting processes, reunderwriting systems, and we 41 00:02:03,680 --> 00:02:08,519 Speaker 4: are seeing uplift that is also translating into increased productivity 42 00:02:08,520 --> 00:02:11,480 Speaker 4: and margin expansion within the portfolios. So if you were 43 00:02:11,520 --> 00:02:15,200 Speaker 4: to look across our private equity portfolios, our private credit portfolios. 44 00:02:15,480 --> 00:02:18,000 Speaker 4: Cash flow growth is still plus or minus ten percent. 45 00:02:18,360 --> 00:02:20,240 Speaker 4: If you look at corporate earnings, I think you're going 46 00:02:20,280 --> 00:02:21,080 Speaker 4: to see that that's. 47 00:02:20,919 --> 00:02:22,320 Speaker 3: Generally the theme. 48 00:02:23,080 --> 00:02:25,480 Speaker 4: And then within the investment space, we are doing our 49 00:02:25,520 --> 00:02:28,480 Speaker 4: best to stay diversified in the way that we're attacking 50 00:02:28,480 --> 00:02:33,400 Speaker 4: the digital infrastructure opportunity big investors in data center development, 51 00:02:33,480 --> 00:02:35,360 Speaker 4: but I think our approaches tended to be a little 52 00:02:35,400 --> 00:02:38,919 Speaker 4: bit more targeted. We're doing one hundred and fifty to 53 00:02:38,960 --> 00:02:44,560 Speaker 4: three hundred megawatt deals hyper scale or adjacent in large 54 00:02:45,000 --> 00:02:50,600 Speaker 4: tier one markets like Tokyo, London. South Paolo pre leased 55 00:02:50,800 --> 00:02:53,800 Speaker 4: twelve to fifteen year terms with escalators, so we have 56 00:02:53,880 --> 00:02:57,239 Speaker 4: probably shied away from some of the secondary and tertiary 57 00:02:57,280 --> 00:02:59,920 Speaker 4: markets and stayed away from some of the frontier mard 58 00:03:00,880 --> 00:03:04,320 Speaker 4: type of opportunities too. We're a very large lender in 59 00:03:04,360 --> 00:03:07,799 Speaker 4: the infrastructure debt space and you're seeing that rolling through 60 00:03:07,800 --> 00:03:09,960 Speaker 4: our earnings as well in terms of the fundraising and 61 00:03:10,000 --> 00:03:12,720 Speaker 4: deployment momentum there. So we are one of the largest 62 00:03:12,800 --> 00:03:17,640 Speaker 4: institutional lenders to other developers and that's been a bright spot. 63 00:03:17,720 --> 00:03:18,960 Speaker 3: Three. We have a large. 64 00:03:18,680 --> 00:03:21,440 Speaker 4: Asset based finance business and we're squaring off with a 65 00:03:21,480 --> 00:03:25,399 Speaker 4: lot of the banks on SRTs and portfolio purchases where 66 00:03:25,400 --> 00:03:28,280 Speaker 4: we're helping them free up liquidity on their balance sheet 67 00:03:28,320 --> 00:03:31,040 Speaker 4: to continue to deploy into the opportunity. 68 00:03:31,320 --> 00:03:32,200 Speaker 3: And then four, we have a. 69 00:03:32,200 --> 00:03:36,120 Speaker 4: Very large infrastructure equity business where we're investing all around 70 00:03:36,680 --> 00:03:41,920 Speaker 4: the digital ecosystem, transmission, fiber, battery, storage, etc. So we're 71 00:03:41,960 --> 00:03:44,240 Speaker 4: kind of attacking it from all angles. But our view 72 00:03:44,240 --> 00:03:46,600 Speaker 4: has been we want to be global, we want to 73 00:03:46,600 --> 00:03:49,880 Speaker 4: be diversified, and we want to have the full capital 74 00:03:49,880 --> 00:03:51,600 Speaker 4: structure so that we can move around where we see 75 00:03:51,600 --> 00:03:52,120 Speaker 4: best relevance. 76 00:03:52,160 --> 00:03:54,360 Speaker 2: That so the second word I want to take into diversified, 77 00:03:54,560 --> 00:03:56,120 Speaker 2: and I'm open to the reality check. I'm just going 78 00:03:56,200 --> 00:03:58,040 Speaker 2: to say, it feels it feels like a lot of 79 00:03:58,080 --> 00:04:01,440 Speaker 2: people are in the same trait asset baked infrastructure debt 80 00:04:01,440 --> 00:04:04,360 Speaker 2: on the credit side, and they're taking direct equity investments 81 00:04:04,360 --> 00:04:07,880 Speaker 2: into say software and models. How do you avoid all 82 00:04:08,000 --> 00:04:11,280 Speaker 2: the crowding that we're starting to see in other places. 83 00:04:11,600 --> 00:04:14,280 Speaker 3: In digital, specifically within your firm. 84 00:04:14,560 --> 00:04:17,359 Speaker 4: Yeah, I think the key in this goes if you 85 00:04:17,360 --> 00:04:20,400 Speaker 4: look at our earnings this quarter and you put the 86 00:04:20,480 --> 00:04:23,479 Speaker 4: numbers up on the screen, what screams out to me 87 00:04:23,640 --> 00:04:26,560 Speaker 4: is just the broad based nature of the business and 88 00:04:26,600 --> 00:04:30,039 Speaker 4: the diversification, and so the way that we think about 89 00:04:30,080 --> 00:04:32,039 Speaker 4: private markets. We want to be up and down the 90 00:04:32,040 --> 00:04:34,640 Speaker 4: capital structure, debt to equity, so that we can move 91 00:04:34,680 --> 00:04:37,960 Speaker 4: around and find real to value and response to rates 92 00:04:38,360 --> 00:04:43,320 Speaker 4: or the economic environment. We want to be horizontally diversified 93 00:04:43,320 --> 00:04:47,360 Speaker 4: across all the different private market asset classes, secondaries, private equity, 94 00:04:47,480 --> 00:04:50,960 Speaker 4: real estate, infra, and you'll see investor appetite and our 95 00:04:51,000 --> 00:04:53,880 Speaker 4: own view of real to value shift. And then within 96 00:04:53,960 --> 00:04:57,200 Speaker 4: the funds, we want to be highly highly diversified. So 97 00:04:57,240 --> 00:04:59,440 Speaker 4: if you look at our credit funds as an example, 98 00:05:00,000 --> 00:05:03,320 Speaker 4: I see nine hundred to one thousand line items, So 99 00:05:03,320 --> 00:05:07,159 Speaker 4: we're not going to have any single exposure really drive 100 00:05:07,560 --> 00:05:10,080 Speaker 4: the long term performance, and I think that's key. There 101 00:05:10,120 --> 00:05:12,960 Speaker 4: is a risk in any investment business that you're over diversified, 102 00:05:13,640 --> 00:05:15,840 Speaker 4: and I could argue maybe a thousand loans in one 103 00:05:15,839 --> 00:05:18,040 Speaker 4: fund is overdiversified, but it's served us well over the 104 00:05:18,080 --> 00:05:19,360 Speaker 4: thirty years that we've been doing it. 105 00:05:19,600 --> 00:05:21,440 Speaker 5: Earlier this year, everyone was saying there's going to be 106 00:05:21,440 --> 00:05:24,520 Speaker 5: a complete collapse, that the private credit space is going 107 00:05:24,560 --> 00:05:27,839 Speaker 5: to go down in flames because of the retail investors, etc. 108 00:05:28,440 --> 00:05:31,400 Speaker 5: And your compatriots and yourself are coming out and saying, 109 00:05:31,440 --> 00:05:33,599 Speaker 5: WHOA not at all. We're seeing actually performance hang in 110 00:05:33,600 --> 00:05:35,880 Speaker 5: there and people are still interested. Where are we in 111 00:05:35,920 --> 00:05:39,360 Speaker 5: that in terms of interest from investors in private credit? 112 00:05:39,400 --> 00:05:43,320 Speaker 5: How much the pendulum has shifted to the infrastructure and 113 00:05:43,360 --> 00:05:44,599 Speaker 5: some of the other plays instead. 114 00:05:44,680 --> 00:05:47,720 Speaker 4: Yeah, Look, we've been pioneers in private credit and people 115 00:05:47,720 --> 00:05:49,840 Speaker 4: have been saying it's a bad place to be for 116 00:05:49,880 --> 00:05:53,120 Speaker 4: thirty years, and it's grown pretty consistently and compounded at 117 00:05:53,120 --> 00:05:56,640 Speaker 4: a very attractive ray of return. So anytime there's a 118 00:05:56,720 --> 00:05:59,440 Speaker 4: narrative that's that loud, you've got to at least ask 119 00:05:59,480 --> 00:06:01,680 Speaker 4: yourself what is it that they're looking at? 120 00:06:02,680 --> 00:06:03,400 Speaker 3: We don't see it. 121 00:06:03,440 --> 00:06:06,080 Speaker 4: If you look at our direct lending business, which is 122 00:06:06,160 --> 00:06:08,800 Speaker 4: kind of where I think people are focused. Are non 123 00:06:08,839 --> 00:06:11,679 Speaker 4: accruals across the direct lending business right now are inside 124 00:06:11,680 --> 00:06:15,920 Speaker 4: of two percent. That is well below the historical averages. 125 00:06:16,400 --> 00:06:19,400 Speaker 4: Our cash flow growth is plus or minus ten percent, 126 00:06:19,520 --> 00:06:23,080 Speaker 4: as I said, and that's been consistent. We are seeing 127 00:06:23,200 --> 00:06:26,640 Speaker 4: healthy interest coverage, very low loans to value. So the 128 00:06:26,720 --> 00:06:31,359 Speaker 4: fundamental performance is exactly what was underwritten. A lot of 129 00:06:31,400 --> 00:06:34,640 Speaker 4: the noise. You know, I don't really know where it's 130 00:06:34,640 --> 00:06:36,719 Speaker 4: coming from. It could be coming from a competitive set 131 00:06:36,720 --> 00:06:39,719 Speaker 4: of capital that doesn't like to see the flows. It 132 00:06:39,760 --> 00:06:43,720 Speaker 4: could be it could be software related. But there's nothing 133 00:06:43,760 --> 00:06:46,280 Speaker 4: that we see in the portfolios that would indicate. 134 00:06:45,920 --> 00:06:47,479 Speaker 3: That credit's weakening. 135 00:06:47,839 --> 00:06:50,120 Speaker 4: And the interesting is your question, and you see at 136 00:06:50,120 --> 00:06:54,560 Speaker 4: this quarter in earnings, the institutional demand for private credit 137 00:06:54,640 --> 00:06:58,160 Speaker 4: is probably accelerating right now because they're seeing spreads widening 138 00:06:58,440 --> 00:07:00,560 Speaker 4: and they're seeing capital leave the mark and feel like 139 00:07:00,560 --> 00:07:03,240 Speaker 4: there's an opportunity to come in and take share. So 140 00:07:03,360 --> 00:07:06,839 Speaker 4: our last two credit funds, both in asset based finance 141 00:07:06,960 --> 00:07:10,480 Speaker 4: and opportunistic credit, hit their hard caps and we had 142 00:07:10,480 --> 00:07:12,720 Speaker 4: to demand well and access for the hard caps, and 143 00:07:12,760 --> 00:07:15,160 Speaker 4: we raise those funds quicker than any prior vintage. 144 00:07:15,240 --> 00:07:17,080 Speaker 5: It's fascinating to hear you talk about the performance of 145 00:07:17,120 --> 00:07:18,680 Speaker 5: these loans, and it's something that we've seen from the 146 00:07:18,760 --> 00:07:20,320 Speaker 5: likes of Capital One and some of these other credit 147 00:07:20,320 --> 00:07:23,240 Speaker 5: card companies. The credit performance is hanging in there. It's 148 00:07:23,240 --> 00:07:25,840 Speaker 5: actually hanging in there better than people expected. Where are 149 00:07:25,880 --> 00:07:28,120 Speaker 5: we in this economic cycle based on some of the 150 00:07:28,120 --> 00:07:30,200 Speaker 5: activity that you're seeing in portfolio companies. 151 00:07:29,880 --> 00:07:30,640 Speaker 3: Yeah, it's. 152 00:07:31,960 --> 00:07:35,360 Speaker 4: If anything, you could say growth is moderating slightly. So 153 00:07:35,520 --> 00:07:38,880 Speaker 4: if we're growing cash flow portfolio wide nine to ten 154 00:07:38,920 --> 00:07:41,920 Speaker 4: percent a year ago, that may have been eleven or twelve, 155 00:07:43,400 --> 00:07:44,400 Speaker 4: but it's not negative. 156 00:07:44,600 --> 00:07:46,480 Speaker 3: So you are slow growth. 157 00:07:46,520 --> 00:07:49,040 Speaker 4: I mean, where are we It's still early And back 158 00:07:49,080 --> 00:07:50,760 Speaker 4: to the first question from Jonathan. 159 00:07:51,080 --> 00:07:52,360 Speaker 3: You're seeing margin. 160 00:07:52,040 --> 00:07:56,280 Speaker 4: Improvement, productivity gains, balance sheets are healthy, companies are delevered. 161 00:07:57,920 --> 00:07:59,840 Speaker 4: So it feels pretty good. And it's just not in 162 00:08:00,040 --> 00:08:01,920 Speaker 4: corporate We see it in the real estate market too. 163 00:08:02,080 --> 00:08:06,440 Speaker 4: We're well leased, we're seeing rent increases and strong demands, 164 00:08:06,480 --> 00:08:07,560 Speaker 4: so everything. 165 00:08:07,240 --> 00:08:07,880 Speaker 3: Feels really good. 166 00:08:08,000 --> 00:08:10,040 Speaker 5: Right now, we're talking about leverage coming out of the system. 167 00:08:10,040 --> 00:08:13,000 Speaker 5: In public markets, there was some concern that maybe leverage 168 00:08:13,000 --> 00:08:16,000 Speaker 5: was building or there was some fraudy types of behavior. 169 00:08:16,040 --> 00:08:19,760 Speaker 5: In private asset management, you talk about one hundred and 170 00:08:19,760 --> 00:08:22,600 Speaker 5: seventy billion dollars of dry powder. I'm just wondering how 171 00:08:22,640 --> 00:08:26,320 Speaker 5: you see some of these structural dynamics in the market 172 00:08:26,480 --> 00:08:29,000 Speaker 5: in terms of ability to finance some of the huge 173 00:08:29,000 --> 00:08:31,000 Speaker 5: bills coming and willingness to do so. 174 00:08:31,240 --> 00:08:33,920 Speaker 4: Yeah, Look, I think one hundred and seventy billion of 175 00:08:34,000 --> 00:08:37,079 Speaker 4: dry powder feels like a lot, but it's actually kind 176 00:08:37,120 --> 00:08:39,160 Speaker 4: of in line with our annual deployment. So if you 177 00:08:39,200 --> 00:08:41,520 Speaker 4: look at the thirty six billion that we raised this quarter, 178 00:08:41,600 --> 00:08:43,920 Speaker 4: we also deployed thirty six billion. 179 00:08:45,240 --> 00:08:47,000 Speaker 3: That's actually a lot quicker. 180 00:08:46,640 --> 00:08:49,120 Speaker 4: Than historical used to take us probably two to three 181 00:08:49,200 --> 00:08:51,280 Speaker 4: years to deploy our dry powder. We're now almost on 182 00:08:51,320 --> 00:08:55,120 Speaker 4: an annual raise and deploy I think with regard to 183 00:08:55,280 --> 00:08:59,240 Speaker 4: the digital capex, obviously there's seven hundred and fifty plus 184 00:08:59,320 --> 00:09:03,320 Speaker 4: billion dollars of capex demand coming from the hyperscalers. That 185 00:09:03,440 --> 00:09:07,320 Speaker 4: is a large amount of capital. It's beginning to quote 186 00:09:07,400 --> 00:09:11,800 Speaker 4: unquote overwhelm the markets. And that's showing up in two ways. One, 187 00:09:11,920 --> 00:09:14,720 Speaker 4: spreads are widening, which is not necessarily a bad thing, 188 00:09:14,760 --> 00:09:17,760 Speaker 4: and people want to get paid more for the risk 189 00:09:17,800 --> 00:09:20,720 Speaker 4: that they're taking. And it's probably slowing the pace of 190 00:09:20,800 --> 00:09:23,920 Speaker 4: the built So you know, when you're thinking about deployment, 191 00:09:24,040 --> 00:09:26,760 Speaker 4: this is not happening overnight. These are two to four 192 00:09:26,840 --> 00:09:31,559 Speaker 4: year projects. You've got energy constraints, you've got community engagement 193 00:09:31,800 --> 00:09:36,240 Speaker 4: and civic discussions that have to go well. So there's 194 00:09:36,280 --> 00:09:39,960 Speaker 4: a lot that's actually constraining the coming online of some 195 00:09:40,040 --> 00:09:43,199 Speaker 4: of this capbec so, at least as we're sitting here today, 196 00:09:43,480 --> 00:09:46,839 Speaker 4: those numbers don't concern me. But your point is a 197 00:09:46,880 --> 00:09:49,560 Speaker 4: good one. And going back to you know, a year ago, 198 00:09:50,000 --> 00:09:53,240 Speaker 4: people were beginning to ask where's all this capital to 199 00:09:53,280 --> 00:09:56,920 Speaker 4: come from? The capex numbers have doubled, and the market is, 200 00:09:57,080 --> 00:09:59,320 Speaker 4: you know, is trying to keep pace, but it's going 201 00:09:59,360 --> 00:10:00,439 Speaker 4: to be a little bit of a constraint. 202 00:10:00,480 --> 00:10:01,840 Speaker 2: I think I thought you were about to ask whether 203 00:10:01,920 --> 00:10:04,760 Speaker 2: Leopold had given Michael cool when you talked about a 204 00:10:04,840 --> 00:10:06,280 Speaker 2: dry powder. 205 00:10:06,800 --> 00:10:08,559 Speaker 5: Maybe, I mean, maybe you were the one that was 206 00:10:08,600 --> 00:10:10,160 Speaker 5: the grim reaper calling, did you care some? 207 00:10:10,160 --> 00:10:13,199 Speaker 1: I love those quotes. Did he give you a call? 208 00:10:14,679 --> 00:10:15,400 Speaker 3: Breaking news? 209 00:10:16,640 --> 00:10:17,839 Speaker 1: And we've got just. 210 00:10:17,800 --> 00:10:20,679 Speaker 2: Get any lessons from that as you see that story, 211 00:10:21,280 --> 00:10:21,920 Speaker 2: I don't know. 212 00:10:22,040 --> 00:10:23,600 Speaker 3: I don't know enough to know. 213 00:10:23,720 --> 00:10:25,800 Speaker 4: I think, if anything, maybe back to your prior question 214 00:10:25,960 --> 00:10:29,360 Speaker 4: is be diversified number one, which is, you know, don't 215 00:10:29,360 --> 00:10:34,559 Speaker 4: be fully exposed to one one factor or single correlation. 216 00:10:34,720 --> 00:10:37,360 Speaker 4: I think that's, you know, that that might be the lesson. 217 00:10:37,400 --> 00:10:39,760 Speaker 4: It might be that experience matters, and that you know, 218 00:10:41,080 --> 00:10:46,479 Speaker 4: combination of smarts and experienced through cycles is ultimately important. 219 00:10:46,520 --> 00:10:47,520 Speaker 3: And I think, you. 220 00:10:47,520 --> 00:10:49,720 Speaker 4: Know, I think about our own thirty year journey and 221 00:10:49,720 --> 00:10:52,800 Speaker 4: all the lessons that we've learned navigating cycles and painful 222 00:10:52,800 --> 00:10:55,360 Speaker 4: one things, and you'll learn lessons the hard way, and 223 00:10:55,400 --> 00:10:57,480 Speaker 4: so that that that might be the moral of the 224 00:10:57,520 --> 00:10:57,959 Speaker 4: story too. 225 00:10:58,280 --> 00:11:01,679 Speaker 2: Stay with us molbl impags Valance. Coming up after this, 226 00:11:11,520 --> 00:11:13,559 Speaker 2: the former New Your Friend President Bill Dudley with a 227 00:11:13,640 --> 00:11:16,120 Speaker 2: new op ed iitled Watch's approach to Fed policy is 228 00:11:16,200 --> 00:11:20,000 Speaker 2: deeply flawed. He writes, outsourcing monetary policy to financial markets 229 00:11:20,160 --> 00:11:23,559 Speaker 2: is a terrible idea. Watsh missed an opportunity to rebuild 230 00:11:23,640 --> 00:11:26,560 Speaker 2: the Fed's credibility. Bill joined us now for more, Bill, 231 00:11:26,600 --> 00:11:28,840 Speaker 2: welcome to the program. We were all watching that news 232 00:11:28,920 --> 00:11:32,319 Speaker 2: conference and it didn't start terribly and then progressively it 233 00:11:32,440 --> 00:11:34,800 Speaker 2: just got more and more confusing. What was the point 234 00:11:34,880 --> 00:11:37,000 Speaker 2: in that news conference where you sat up and said 235 00:11:37,600 --> 00:11:38,200 Speaker 2: this is weird. 236 00:11:39,360 --> 00:11:42,560 Speaker 6: Well, it's weird when you're not explaining why three people 237 00:11:42,600 --> 00:11:46,280 Speaker 6: are dissenting, yet the committee is deciding and no changing policies. 238 00:11:46,280 --> 00:11:49,200 Speaker 6: It really was virtually no information about how the Fed 239 00:11:49,280 --> 00:11:51,920 Speaker 6: Reserve is thinking about mandre policy, how the Fed Reserve 240 00:11:52,000 --> 00:11:54,719 Speaker 6: is likely to react to incoming information in terms of 241 00:11:54,760 --> 00:11:59,040 Speaker 6: how they adjust Manjar policy. The silence of Watsh was 242 00:11:59,080 --> 00:12:03,400 Speaker 6: really quite definitely and the financial markets basically that thumbs down. 243 00:12:03,480 --> 00:12:05,160 Speaker 6: I mean the fact that the thirty year yield went 244 00:12:05,200 --> 00:12:07,040 Speaker 6: up to ten year wheel went up and two year 245 00:12:07,120 --> 00:12:10,000 Speaker 6: yelds dropped really was a sign that there was a 246 00:12:10,080 --> 00:12:12,320 Speaker 6: loss of credibility in that from that press. 247 00:12:12,280 --> 00:12:14,599 Speaker 2: Conference, Bill, I want to highlight a distinction because I 248 00:12:14,600 --> 00:12:16,800 Speaker 2: think it's important and it's in the body of your OPAD, 249 00:12:16,840 --> 00:12:18,640 Speaker 2: and I want to say it for you. You're not 250 00:12:18,800 --> 00:12:22,640 Speaker 2: against reducing forward guidance. This is important. I think that 251 00:12:22,760 --> 00:12:25,959 Speaker 2: the complaints about the people doing the complaining often or 252 00:12:26,000 --> 00:12:28,520 Speaker 2: around the idea that somehow we still want our hands 253 00:12:28,600 --> 00:12:31,360 Speaker 2: being helled, that we want to hold on to the 254 00:12:31,440 --> 00:12:34,319 Speaker 2: post GFC communication architecture, and Bill, I don't think that's 255 00:12:34,360 --> 00:12:37,360 Speaker 2: what your criticism is about, no. 256 00:12:37,520 --> 00:12:40,719 Speaker 6: I mean I wrote a group of thirty paper that 257 00:12:40,840 --> 00:12:43,040 Speaker 6: we published in April, and one of the recommendations was 258 00:12:43,080 --> 00:12:45,240 Speaker 6: to get rid of four guidance. The only time we 259 00:12:45,280 --> 00:12:47,040 Speaker 6: really need four guides is when you're at the zero 260 00:12:47,080 --> 00:12:48,920 Speaker 6: loor bound for interest rates and you're trying to provide 261 00:12:48,920 --> 00:12:52,000 Speaker 6: additional monetary policy stimulus. But the rest of the time 262 00:12:52,160 --> 00:12:54,280 Speaker 6: it really just sort of inhibits the FED and probably 263 00:12:54,320 --> 00:12:56,280 Speaker 6: makes the FED a little bit slower to react to 264 00:12:56,400 --> 00:12:59,719 Speaker 6: incoming information, But that doesn't mean you don't want to 265 00:12:59,800 --> 00:13:02,360 Speaker 6: know what the Fed's monetary policy reaction function is. And 266 00:13:02,440 --> 00:13:05,120 Speaker 6: I think that's the real problem Abortion and it's comments 267 00:13:05,559 --> 00:13:07,920 Speaker 6: is conflating the two and they're very very different. If 268 00:13:07,960 --> 00:13:09,640 Speaker 6: I don't understand how the FED reeser is going to 269 00:13:09,679 --> 00:13:12,760 Speaker 6: react to incoming information, I can't price financial markets correctly. 270 00:13:13,160 --> 00:13:15,439 Speaker 6: And it's also creating a lot of uncertainty about what 271 00:13:15,559 --> 00:13:16,960 Speaker 6: policy is going to be in the future. 272 00:13:17,400 --> 00:13:17,520 Speaker 1: Uh. 273 00:13:17,760 --> 00:13:21,400 Speaker 6: You know, the market response on Wednesday was really FED 274 00:13:21,480 --> 00:13:25,160 Speaker 6: credibility has lessened, and I think this is a. 275 00:13:25,240 --> 00:13:27,079 Speaker 7: Really own goal on Kevin Wursh's part. 276 00:13:27,760 --> 00:13:29,200 Speaker 6: You know, I think when one of the problems here, 277 00:13:29,240 --> 00:13:32,000 Speaker 6: I think it is these overpromised and under delivered. You know, 278 00:13:32,080 --> 00:13:33,920 Speaker 6: you've talked about, you know, see change at the FED, 279 00:13:34,320 --> 00:13:37,720 Speaker 6: radical regime change, but then the markets are actually getting 280 00:13:38,400 --> 00:13:40,839 Speaker 6: very very little in terms of guidance on how to 281 00:13:40,880 --> 00:13:42,240 Speaker 6: think about the new FED. 282 00:13:42,440 --> 00:13:44,520 Speaker 5: Well, we were discussing about where there maybe some of 283 00:13:44,559 --> 00:13:47,280 Speaker 5: this was by design. There is going to be more volatility. 284 00:13:47,320 --> 00:13:49,440 Speaker 5: There has been more volatility both at the front end 285 00:13:49,520 --> 00:13:52,520 Speaker 5: and the long end, in response to every economic data 286 00:13:52,559 --> 00:13:54,920 Speaker 5: point and comment coming from anyone on the Federal Reserve 287 00:13:55,200 --> 00:13:57,480 Speaker 5: as a result of an absence of some sort of 288 00:13:57,600 --> 00:14:01,079 Speaker 5: reaction function articulated by the FMCA. Do you think that 289 00:14:01,160 --> 00:14:03,480 Speaker 5: this could be by design to help produce inflation without 290 00:14:03,559 --> 00:14:04,240 Speaker 5: hiking rates. 291 00:14:05,320 --> 00:14:07,400 Speaker 6: I don't think this is a really great strategy for 292 00:14:07,480 --> 00:14:09,600 Speaker 6: a couple of reasons. Number One, it's a very inefficient 293 00:14:09,679 --> 00:14:13,719 Speaker 6: way of tightening financial conditions. Basically, you're driving up risk 294 00:14:13,760 --> 00:14:16,360 Speaker 6: bringing in markets. That's a dead weight loss to the economy. 295 00:14:17,040 --> 00:14:19,480 Speaker 6: Number Two, how well can you actually control the market 296 00:14:19,560 --> 00:14:23,040 Speaker 6: process to generate the impulse that you want to slow 297 00:14:23,080 --> 00:14:25,120 Speaker 6: the economy down sufficiently? 298 00:14:25,440 --> 00:14:27,920 Speaker 7: And lastly, you know it's a credibility issue. I mean, 299 00:14:28,040 --> 00:14:29,000 Speaker 7: if the extent that the. 300 00:14:29,000 --> 00:14:31,040 Speaker 6: Market's reacted the way they did on Wednesday, that's telling 301 00:14:31,040 --> 00:14:33,600 Speaker 6: you that people are more worried about the Feds resolved 302 00:14:33,640 --> 00:14:37,080 Speaker 6: to do the job. That means inflation expectations are less 303 00:14:37,080 --> 00:14:39,480 Speaker 6: well anchored than they were prior to the press conference. 304 00:14:39,840 --> 00:14:41,800 Speaker 7: That in itself makes the Fed's job harder. 305 00:14:42,240 --> 00:14:43,920 Speaker 5: Bill how high is the bar for there to be 306 00:14:44,240 --> 00:14:47,040 Speaker 5: I don't want to say mutiny, but the bulk of 307 00:14:47,160 --> 00:14:50,520 Speaker 5: the FMC committee voting against the chair, potentially with the 308 00:14:50,600 --> 00:14:51,640 Speaker 5: Governor's joining suit. 309 00:14:52,720 --> 00:14:54,040 Speaker 6: I don't think we would get to that. I think 310 00:14:54,080 --> 00:14:56,920 Speaker 6: at that point worsh was throwing the tonnel and vote 311 00:14:56,920 --> 00:15:00,520 Speaker 6: with the majority. I can't imagine a situation where the 312 00:15:00,640 --> 00:15:03,680 Speaker 6: chairman allows themselves to be outloaded by the Committee because 313 00:15:03,680 --> 00:15:05,880 Speaker 6: if you if you had that result, it'd basically would 314 00:15:05,880 --> 00:15:08,120 Speaker 6: be saying that the chairman has lost control of the Committee, 315 00:15:08,120 --> 00:15:11,640 Speaker 6: and that's just not a very good look for any organization. 316 00:15:11,920 --> 00:15:12,120 Speaker 1: Bill. 317 00:15:12,160 --> 00:15:14,600 Speaker 2: It was also vague about the inflation target. That was confusing. 318 00:15:14,640 --> 00:15:18,120 Speaker 2: Too vague on the inflation target, whether they'd respond to it, 319 00:15:18,800 --> 00:15:20,480 Speaker 2: and what's aol they would use to respond? 320 00:15:20,800 --> 00:15:22,040 Speaker 3: Can I pick up on that last point? 321 00:15:22,120 --> 00:15:24,800 Speaker 2: Bill, he's flirting with the idea of using balance sheet 322 00:15:24,840 --> 00:15:26,920 Speaker 2: instead of short term policy rights. 323 00:15:27,520 --> 00:15:29,320 Speaker 3: Sure, right, Well, what do you think of it? 324 00:15:29,920 --> 00:15:30,080 Speaker 7: Well? 325 00:15:30,080 --> 00:15:31,560 Speaker 6: I think the problem here is that even if you 326 00:15:31,640 --> 00:15:34,080 Speaker 6: reduce the balance sheet, you're probably going to be reduced 327 00:15:34,160 --> 00:15:36,800 Speaker 6: by about a trillion dollars or so if you want 328 00:15:36,840 --> 00:15:39,160 Speaker 6: to continue to have an ample reserves regime. And I 329 00:15:39,200 --> 00:15:41,560 Speaker 6: think the commandment of the Committee is to maintain the 330 00:15:41,560 --> 00:15:43,720 Speaker 6: ample reserve regime. And then the question is how much 331 00:15:43,760 --> 00:15:45,840 Speaker 6: restraint is shrinking the balance sheet by a trillion dollar 332 00:15:45,920 --> 00:15:48,120 Speaker 6: is going to be, it's actually gonna be very very small. 333 00:15:48,400 --> 00:15:50,040 Speaker 6: So the idea that you know, you pull on this 334 00:15:50,800 --> 00:15:53,200 Speaker 6: balance sheet lever and that allows you to not have 335 00:15:53,360 --> 00:15:56,320 Speaker 6: to tighten monitary policy, I think is very much exaggerated. 336 00:15:56,600 --> 00:15:58,480 Speaker 2: It's obvious that for the market, the primary tool is 337 00:15:58,520 --> 00:16:00,720 Speaker 2: still the policy, right because it's in the reaction this 338 00:16:00,880 --> 00:16:03,320 Speaker 2: morning to the sensitive economic eight that we've got moments 339 00:16:03,360 --> 00:16:06,480 Speaker 2: ago on wages, they came in hotter labor costs. You 340 00:16:06,560 --> 00:16:08,200 Speaker 2: saw yields rise at the front end of the curve. 341 00:16:08,560 --> 00:16:11,080 Speaker 2: But we talked about this all morning, the credibility hit. 342 00:16:11,240 --> 00:16:13,680 Speaker 2: You say, credibility has been hit. Others agree with you. 343 00:16:14,160 --> 00:16:16,440 Speaker 2: Let's talk about how you repair it. When you do 344 00:16:16,560 --> 00:16:19,440 Speaker 2: a job really badly, sometimes you have to do more 345 00:16:19,560 --> 00:16:21,800 Speaker 2: than you otherwise would have had to do. How much 346 00:16:21,840 --> 00:16:23,440 Speaker 2: more do they need to do now at this far 347 00:16:23,560 --> 00:16:25,880 Speaker 2: of reserve to regain that credibility. 348 00:16:27,120 --> 00:16:29,480 Speaker 7: Well, I think you have to follow up talk with actions. 349 00:16:29,560 --> 00:16:32,280 Speaker 6: So I think that what's happened in financial markets over 350 00:16:32,280 --> 00:16:35,560 Speaker 6: the last seventy two hours or so basically increases the 351 00:16:35,600 --> 00:16:38,400 Speaker 6: pressure on the Fed to act in September. If it's 352 00:16:38,400 --> 00:16:40,960 Speaker 6: a jump ball in September, you almost need to tighten 353 00:16:41,040 --> 00:16:44,320 Speaker 6: now because you have lost credibility over the last couple 354 00:16:44,360 --> 00:16:44,680 Speaker 6: of months. 355 00:16:44,800 --> 00:16:46,360 Speaker 5: Do you think that it increases the chance of a 356 00:16:46,440 --> 00:16:47,880 Speaker 5: larger than expected great hike. 357 00:16:49,320 --> 00:16:51,560 Speaker 6: It's possible, but I don't think that you're so far 358 00:16:51,640 --> 00:16:55,040 Speaker 6: away from your inflation objective that you know you need 359 00:16:55,120 --> 00:16:57,920 Speaker 6: sort of shock therapy. If the feder Reserve did fifty 360 00:16:57,960 --> 00:17:00,400 Speaker 6: basis points move, that would be, in my mind a 361 00:17:00,440 --> 00:17:02,800 Speaker 6: little bit of the sign of desperation. Why didn't you 362 00:17:02,960 --> 00:17:05,640 Speaker 6: like in July and you do fifty basis points in September. 363 00:17:05,840 --> 00:17:08,840 Speaker 6: I think that's actually it is a confusing narrative as well. 364 00:17:09,440 --> 00:17:11,840 Speaker 1: What do you think the overall motivation is here? 365 00:17:12,040 --> 00:17:14,199 Speaker 5: I mean, we've been talking about this and a lot 366 00:17:14,240 --> 00:17:16,560 Speaker 5: of people said Kevin worsh is a one hundred percent 367 00:17:16,680 --> 00:17:20,959 Speaker 5: respected person by the mainstream of the financial markets, by 368 00:17:20,960 --> 00:17:24,320 Speaker 5: the establishment. Do you think this is just Rookie's error, 369 00:17:24,640 --> 00:17:27,360 Speaker 5: the classic kind of first press conference of a FED 370 00:17:27,480 --> 00:17:29,760 Speaker 5: chair or do you think that there is some political 371 00:17:29,840 --> 00:17:32,479 Speaker 5: motivation here trying to dodge the ire of the president 372 00:17:32,600 --> 00:17:33,920 Speaker 5: going into the midterm elections. 373 00:17:35,000 --> 00:17:37,800 Speaker 6: I can't judge that, but I generally think no, that 374 00:17:37,920 --> 00:17:39,720 Speaker 6: he's not trying to do it to sort of modify 375 00:17:39,800 --> 00:17:42,320 Speaker 6: the president. I think he really does believe that somehow 376 00:17:42,400 --> 00:17:45,840 Speaker 6: outsourcing this to financial markets will improve the conduct of 377 00:17:45,880 --> 00:17:48,520 Speaker 6: monetary policy. But you can't outsource it to financial markets 378 00:17:48,520 --> 00:17:51,119 Speaker 6: for a very simple reason. Markets don't price to what 379 00:17:51,200 --> 00:17:53,320 Speaker 6: the FED should do. They priced to what they think 380 00:17:53,359 --> 00:17:55,440 Speaker 6: the FED will do. And so if you try to 381 00:17:55,440 --> 00:17:57,560 Speaker 6: ask the markets, all you have is the market's looking 382 00:17:57,600 --> 00:18:00,359 Speaker 6: the FED, the FED looking at markets, and the interest 383 00:18:00,400 --> 00:18:01,560 Speaker 6: rate path is indeterminate. 384 00:18:01,760 --> 00:18:04,680 Speaker 2: It's the word that we were talking about yesterday, which 385 00:18:04,720 --> 00:18:06,199 Speaker 2: is everyone's pointing at each other. 386 00:18:06,320 --> 00:18:08,480 Speaker 1: And I saw a couple versions of that FED. 387 00:18:08,800 --> 00:18:10,600 Speaker 2: I'm sure you did, but it's going to see you. 388 00:18:10,640 --> 00:18:12,199 Speaker 2: Thank you, buddy, go down do that if you're New 389 00:18:12,240 --> 00:18:14,480 Speaker 2: York for president. Thank you very much, sir. I appreciate 390 00:18:14,520 --> 00:18:18,119 Speaker 2: your time. Stay with us more Bloomberg Savanna's coming up 391 00:18:18,560 --> 00:18:30,640 Speaker 2: after this, joining us now. General Robert Welsh of Academy 392 00:18:30,680 --> 00:18:33,720 Speaker 2: Securities General, welcome back to the program, Sir. Is this 393 00:18:33,920 --> 00:18:37,520 Speaker 2: situation now more dangerous than it was four or five 394 00:18:37,560 --> 00:18:38,000 Speaker 2: months ago? 395 00:18:39,760 --> 00:18:44,480 Speaker 8: I think overall the situation Iran has gotten much more dangerous. 396 00:18:44,600 --> 00:18:46,680 Speaker 8: But I think the last piece that Tyler added, the 397 00:18:46,760 --> 00:18:51,000 Speaker 8: peace on Gaza, makes it very significant that the larger 398 00:18:51,119 --> 00:18:56,600 Speaker 8: Middle East peace plan. The Hamas disarmament agreement, which will 399 00:18:56,640 --> 00:18:59,720 Speaker 8: take some time, is a big step in that it's 400 00:18:59,760 --> 00:19:03,520 Speaker 8: an other step in isolating Iran, and what we're seeing 401 00:19:03,560 --> 00:19:06,199 Speaker 8: throughout the Middle East more and more these pieces are 402 00:19:06,240 --> 00:19:07,359 Speaker 8: coming into place. 403 00:19:07,520 --> 00:19:10,520 Speaker 7: That is isolating Iran more and more. This was a 404 00:19:10,600 --> 00:19:12,680 Speaker 7: case where the IRGC. 405 00:19:13,760 --> 00:19:17,320 Speaker 8: Asked Hamas to delay this decision and not continue with it, 406 00:19:18,240 --> 00:19:22,920 Speaker 8: and in fact they Hamas went against this and agreed 407 00:19:22,960 --> 00:19:25,680 Speaker 8: to the disarmament. Now the devil's into details and we'll 408 00:19:25,680 --> 00:19:28,000 Speaker 8: see where it goes. But this is a step in 409 00:19:28,080 --> 00:19:31,800 Speaker 8: that direction. And the larger question is the situation with 410 00:19:31,920 --> 00:19:36,119 Speaker 8: Iran getting more dangerous. It obviously is in the sense 411 00:19:36,240 --> 00:19:39,240 Speaker 8: that we've gone from a phase of really deterrence where. 412 00:19:39,200 --> 00:19:40,399 Speaker 7: Ceasefire was in place. 413 00:19:41,160 --> 00:19:43,800 Speaker 8: We've kind of gone back and forth for with these 414 00:19:43,880 --> 00:19:47,639 Speaker 8: attacks between Iran and the US have been occurring. But 415 00:19:47,800 --> 00:19:51,520 Speaker 8: now what you're seeing is Iran again using their asymmetric 416 00:19:51,600 --> 00:19:55,840 Speaker 8: capabilities to try to spread the fight and extend this 417 00:19:56,240 --> 00:19:59,720 Speaker 8: throughout the region by bringing in the Houthis into it, 418 00:20:00,400 --> 00:20:04,399 Speaker 8: bringing in the Shia Iraq militias into it, attacking the 419 00:20:04,480 --> 00:20:07,359 Speaker 8: Saudi Arabia oil fields. So a little bit of a 420 00:20:07,440 --> 00:20:11,440 Speaker 8: widening going on here, and that's Iran's asymmetric approaches to 421 00:20:11,520 --> 00:20:14,560 Speaker 8: try to wordinate widen the war put more pressure on 422 00:20:14,640 --> 00:20:17,720 Speaker 8: the US and the US's partners in the region general. 423 00:20:18,040 --> 00:20:19,639 Speaker 5: What do you think the next steps will be for 424 00:20:19,840 --> 00:20:23,239 Speaker 5: the US and its regional partners as the war does 425 00:20:23,320 --> 00:20:25,240 Speaker 5: broaden now more significantly. 426 00:20:26,080 --> 00:20:28,199 Speaker 8: Great question, Lise. I think the President has a lot 427 00:20:28,240 --> 00:20:31,040 Speaker 8: of options on the table right now. I think the 428 00:20:31,119 --> 00:20:35,159 Speaker 8: president's desires to get back to getting a deal. He 429 00:20:35,280 --> 00:20:37,400 Speaker 8: continues to say that over and over, and you saw 430 00:20:37,800 --> 00:20:42,720 Speaker 8: where we had this thirteen day significant escalation by the US, 431 00:20:42,840 --> 00:20:44,840 Speaker 8: and this was now for the first time, instead of 432 00:20:44,880 --> 00:20:47,960 Speaker 8: a tit for tat approach, the US used a disproportion 433 00:20:48,119 --> 00:20:51,000 Speaker 8: approach where if Iran hit US with three missiles, we 434 00:20:51,160 --> 00:20:54,720 Speaker 8: went back and hit them with hundreds of attacks on. 435 00:20:56,200 --> 00:20:59,720 Speaker 7: Targets throughout the Golfer each or throughout Iran. 436 00:21:00,840 --> 00:21:03,440 Speaker 8: But with that, now that what we're seeing is that's 437 00:21:04,160 --> 00:21:07,120 Speaker 8: the president again kind of settled things down, stop those 438 00:21:07,200 --> 00:21:12,479 Speaker 8: attacks to see if negotiations could continue. And I think 439 00:21:12,520 --> 00:21:15,200 Speaker 8: the options he's got now is you know, one that 440 00:21:15,840 --> 00:21:18,240 Speaker 8: Admiral Cooper has on the plate is to go much 441 00:21:18,359 --> 00:21:22,280 Speaker 8: larger and really try to increase the number attacks more 442 00:21:22,280 --> 00:21:24,800 Speaker 8: along the ways of what we were doing earlier in 443 00:21:24,880 --> 00:21:28,440 Speaker 8: the war, but again really trying to isolate the straight 444 00:21:28,520 --> 00:21:31,879 Speaker 8: of horror moves by attacking you know, command control facilities, 445 00:21:32,200 --> 00:21:35,040 Speaker 8: drone and missile capabilities that can strike the straits of 446 00:21:35,080 --> 00:21:35,560 Speaker 8: horror moves. 447 00:21:36,720 --> 00:21:40,000 Speaker 3: That would probably be a phase one approach. See how 448 00:21:40,080 --> 00:21:41,920 Speaker 3: that goes, and if you can. 449 00:21:41,880 --> 00:21:44,200 Speaker 8: Get around to kind of back off and try to 450 00:21:44,560 --> 00:21:46,679 Speaker 8: you know, push their will to the point where they 451 00:21:46,720 --> 00:21:49,240 Speaker 8: want to get back to the negotiating table, get to 452 00:21:49,320 --> 00:21:52,360 Speaker 8: a ceasefire, that would be a step. If that doesn't work, 453 00:21:52,400 --> 00:21:54,320 Speaker 8: I think another option on the table is to go 454 00:21:54,520 --> 00:21:57,040 Speaker 8: really big, and that would be to try to isolate 455 00:21:57,119 --> 00:22:02,359 Speaker 8: the country itself to really significantly after probably bringing in Israel, 456 00:22:02,440 --> 00:22:05,000 Speaker 8: go after infrastructure targets throughout the region. 457 00:22:06,119 --> 00:22:09,640 Speaker 2: This is the Bloomberg Surveillance Podcast, bringing you the best 458 00:22:09,720 --> 00:22:13,000 Speaker 2: in markets, economics, a geopolitics. You can watch the show 459 00:22:13,080 --> 00:22:16,000 Speaker 2: live on Bloomberg TV weekday mornings from six am to 460 00:22:16,160 --> 00:22:19,880 Speaker 2: nine am Eastern. Subscribe to the podcast on Apple, Spotify 461 00:22:20,040 --> 00:22:22,280 Speaker 2: or anywhere else you listen, and as always on the 462 00:22:22,320 --> 00:22:24,720 Speaker 2: Bloomberg Terminal and the Bloomberg Business app.