Speaker 1: Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keane. Along
Speaker 1: with Jonathan Ferrell and Lisa Brownwitz. Daily we bring you
Speaker 1: insight from the best and economics, finance, investment, and international relations.
Speaker 1: Find Bloomberg Surveillance on Apple Podcast, Suncloud, Bloomberg dot Com,
Speaker 1: and of course on the Bloomberg terminal. Right now is
Speaker 1: a treat, and it's a particular treat for me after
Speaker 1: this pandemic to have parachuting into our Bloomberg building. The
Speaker 1: World Bank president at David mel Pass I first learned
Speaker 1: of him at bear Stearns a few years ago. I
Speaker 1: have said many times in speeches the single best English
Speaker 1: skills crafted at Colorado College that I know. In Kaylee lines,
Speaker 1: are are thrilled to welcome the President of the World
Speaker 1: Bank this morning. We have so much to talk about,
Speaker 1: not enough time, but I need to address right away
Speaker 1: the delicacy of you, as President World Bank managing not
Speaker 1: a scandal but an uproar with the Managing Director of
Speaker 1: the International Monetary Fund when she was at the World Bank.
Speaker 1: You've made some very important public comments on that. Summarize
Speaker 1: that right now of how you stand in the study
Speaker 1: of these allegations against Dr George. I think there are
Speaker 1: bigger stories for us. This morning puts on a lot
Speaker 1: of reports and so in there were staff raised questions
Speaker 1: about the integrity of data dating back to eighteen and
Speaker 1: so there was an outside firm brought in and a
Speaker 1: law firm to look at it. The Board of Directors
Speaker 1: got into it, issued the report last week, so it
Speaker 1: shows the irregularities and goes through that the report speaks
Speaker 1: for itself. You speaks for the report. You think the
Speaker 1: report stands on its own, And yes, and we've discontinued report.
Speaker 1: But the World Bank is going to be very, very
Speaker 1: involved in the business climate of developing countries. That's critical
Speaker 1: for them in establishing jobs and getting growth, in in
Speaker 1: attracting new investment, and that's the purpose of the report.
Speaker 1: The purpose of the World Bank UH is to help
Speaker 1: countries and the people in the countries move ahead. So
Speaker 1: we're still going to be doing that. You're gonna still
Speaker 1: be doing that, and you have this report come out
Speaker 1: as well, and we don't need to get into the
Speaker 1: nitty gritty of who did this or what is further
Speaker 1: action needed by you on this uproar? Are you saying
Speaker 1: enough let's move on the reports discontinued and will be
Speaker 1: forming and looking for new ways to have an impact
Speaker 1: in those areas, which I think is the most important thing. Now.
Speaker 1: Time is too valuable. Right now, it's seven dollars a
Speaker 1: dose to get a vaccine. Why can't we vaccinate Africa? Yeah,
Speaker 1: this is on everyone's mind, and it's frustrating the access
Speaker 1: in the advanced economies where I'm share a task force
Speaker 1: that includes I, M F W T O and and
Speaker 1: UH W H O uh. And so that there are
Speaker 1: two point four billion excess doses in the advanced economies.
Speaker 1: So the goal would be to have those early doses,
Speaker 1: the early deliveries go to developing countries where that can
Speaker 1: use those particular doses. You know, it's a hard logistics
Speaker 1: problem because you've got to get the dose from the
Speaker 1: factory uh to a country that wants that kind of dose.
Speaker 1: So some want m r NA doses, someone astras in
Speaker 1: because some want J and J and so on down
Speaker 1: the list, and then they sit in a warehouse UH,
Speaker 1: and they're not applied to people, and that I think
Speaker 1: has to be improved. We're urging and the task forces
Speaker 1: urging the advanced economies to allow swapping of doses. So
Speaker 1: if they have a delivery scheduled into their warehouses in
Speaker 1: October of this year or November of this year, allow
Speaker 1: that dose to go to a developing country person and
Speaker 1: take a later delivery schedule because you don't need it.
Speaker 1: You've got excess two point four billion doses. Yeah, David
Speaker 1: is an excellent point. We're having a conversation now about
Speaker 1: boosters here in the US when there's many people throughout
Speaker 1: the world who have yet to receive their initial dose.
Speaker 1: Do you need the Biden administration to take more leadership
Speaker 1: on that, Hi, Kyley, You know I don't. I think
Speaker 1: the world has to come together and find solutions to
Speaker 1: this problem. Um and the boosters are countries are going
Speaker 1: to want to do that as needed in order to
Speaker 1: protect their population. That still leaves huge amounts of excess
Speaker 1: doses even in near term deliveries. What we're working on
Speaker 1: right now is trying to get November and December deliveries
Speaker 1: UH scheduled so that so that the countries can prepare
Speaker 1: to deliver that kind You need a specific kind of
Speaker 1: cold storage or of of of of trained personnel on
Speaker 1: each kind of vaccine, and that needs. We need much
Speaker 1: higher numbers of vaccine nations in developing countries and especially
Speaker 1: the poorest countries. Well, David, of course, the United States
Speaker 1: has made pledges on the vaccine front. Also this week
Speaker 1: at the United Nations, the President doubled his commitment in
Speaker 1: terms of financial aid for climate change for the developing world.
Speaker 1: Just how bad is the climate problem in certain areas
Speaker 1: of the world, and from an economic standpoint, how dire
Speaker 1: is the situation the from an adaptation standpoint, so preparing
Speaker 1: for changes in climate the countries are way behind and
Speaker 1: that costs lives. The World Bank, the World Banks the
Speaker 1: biggest financeer of climate change in the among the international
Speaker 1: financial institutions. In fact, more than half of all of
Speaker 1: the finances World Bank, and over half of that is
Speaker 1: for adaptation, to to address countries that are in low
Speaker 1: lying areas, people who are populations are at risk. The
Speaker 1: other part of the equation is to identify and priorities
Speaker 1: is the highest emitters of greenhouse gases and recognize that
Speaker 1: those have to be brought down. Uh that that's a
Speaker 1: small group of countries with big emissions, and more importantly,
Speaker 1: the projection of emissions into the future. You know, There
Speaker 1: are nine thousand coal fired power plants today and there
Speaker 1: are more in the planning stages. The permits are still
Speaker 1: being issued. So these are big challenges that cost a
Speaker 1: lot of money and there has to be a plan
Speaker 1: for actually, what do you do with the workers, how
Speaker 1: do you change the system so that there's less greenhouse
Speaker 1: gas emissions? And what can you impute on China? If
Speaker 1: China is struggling with us to say the least, and
Speaker 1: the marginal development of coal, what does the World Bank
Speaker 1: strategy to assist China to a better climate outcome. We
Speaker 1: have some programs in China, but you know, it's income
Speaker 1: has gone up and we're reducing that. Most of most
Speaker 1: of our programs are are in the area of of
Speaker 1: global public goods and space, typically marine plastic abatement, so
Speaker 1: that because a lot of plastic goes into the oceans
Speaker 1: from the rivers in in China, and so we're working
Speaker 1: on that heavily. With regard to COLE we do have
Speaker 1: one project area in China, but wherever it is in
Speaker 1: the world, it's hard to decommission an actual operating coal plant.
Speaker 1: The USC s that and that's a challenge. So the
Speaker 1: world's looking to China to do that to to change
Speaker 1: and I saw yesterday China release the the idea that
Speaker 1: they're not going to finance coal fired plants outside China.
Speaker 1: So that's a step around the world. We need all
Speaker 1: of those steps. We're gonna run out of time, President Malpass,
Speaker 1: But I want to say that today is a wonderful symbol.
Speaker 1: You are the first public official to attend with US
Speaker 1: lives since the pandemic began. It's a great, great moment, fabulous.
Speaker 1: It's good to be here, Tom. I wish the times
Speaker 1: were better because it's chaos across a lot of the
Speaker 1: developing world. I'm not gonna ask you about FED policy today.
Speaker 1: David bel Pess, thank you so much. He is a
Speaker 1: World Bank UH president as well. We're gonna stop the
Speaker 1: show right now on economics, finance, investment, and international relations
Speaker 1: and speak to an authority linking economics to ethics. You
Speaker 1: cannot do better than Glenn Hubbard. He is the dean
Speaker 1: emeritus of Columbia Business School, formally with the Council of
Speaker 1: Economic Advisors. He wants to talk I s l M
Speaker 1: theory and the rest of it. We don't we want
Speaker 1: to talk Glenn Hubbard about course B eight five eight
Speaker 1: three dash zero zero one is you resurrected Columbia Business School.
Speaker 1: You said we need to teach ethics, explain executive ethics
Speaker 1: and the idea that senior officials of the FED can
Speaker 1: do investment in bond derivative products. Well, the first part
Speaker 1: maybe easier than the second. On the first part, we
Speaker 1: do believe in this business cool parctly any top business school,
Speaker 1: that people need to understand the context of their decisions.
Speaker 1: Part of that ethics, part of its understanding social structure.
Speaker 1: The FED obviously does have to take a hard look
Speaker 1: at its rules as as as Congress, as does the administrations.
Speaker 1: I think it is a matter for ongoing discussion and
Speaker 1: cheer powells and a pretty strong signal. Well, it sound
Speaker 1: a pretty strong signal. But what should be the best
Speaker 1: outcome here? I'm not talking about senators and the politicians
Speaker 1: with feed officials and investment. What seems so germane to
Speaker 1: me is yeah, they can buy apple. That doesn't matter.
Speaker 1: Thinking by stock market, even commodities, et F etcetera. But
Speaker 1: the trading of anything having to do with a fixed
Speaker 1: income market did that strike you as odd? It does?
Speaker 1: I mean, I think the safer route for a feteficial
Speaker 1: would be to just toll on market measures, no trading
Speaker 1: of individual stocks or speculation in the fixed income market.
Speaker 1: You know, part of being an official is an abundance
Speaker 1: of caution so that people don't challenge your motors. Professor,
Speaker 1: do you think this is the credibility of the Federal
Speaker 1: Reserve or not? I don't. I don't. I think it's unfortunate,
Speaker 1: but I don't think it's certain the credibility of the FED.
Speaker 1: The issues for the credibility of the FED really have
Speaker 1: more to do with it stands on policy, frankly, than
Speaker 1: that on ethics. I want to talk about policy as well,
Speaker 1: particularly social policy. Professor. This is the quote from Senator
Speaker 1: Path to me. He said, I think he's tolerated a politicization.
Speaker 1: He's talking about Chair and Powell. The FED won't dring
Speaker 1: into the social and cultural areas where the FED doesn't belong. Professor,
Speaker 1: Can I have your reaction to that quote? What you
Speaker 1: make of that? Well, it's hard you know exactly what
Speaker 1: the center, to me is referring to the FED does
Speaker 1: have to think about the broader social construct of the economy.
Speaker 1: At the same time, in any organization, you want to
Speaker 1: be clear, you don't have mission creep. The job one
Speaker 1: for the FED is low and stable inflation and maximum
Speaker 1: employment and of course financial stability. Some of the social
Speaker 1: concerns are wound up in that climate change, for example.
Speaker 1: But I think the FED has to be very careful
Speaker 1: to focus on its key jobs and do them well.
Speaker 1: Confederate Reserve Chairman Jerome Powell continue to do his job well,
Speaker 1: do you think he deserves the second term? Well, out,
Speaker 1: of course is for the presidents, is they not for me?
Speaker 1: I think he does. The FED has had I think
Speaker 1: a good record during the pandemic period, and I agree
Speaker 1: with everything, but certainly very good record. Cheer. Powell also
Speaker 1: has had an ability that's quite distinctive to talk credibly
Speaker 1: to people on both sides of the aisle. So I
Speaker 1: think it would probably be a mistake not to reappointment. Well,
Speaker 1: let's talk about how he's going to talk at the
Speaker 1: press conference today. Do you think the FED can credibly
Speaker 1: separate a tapering of bond purchases month on month versus
Speaker 1: starting to hike interest rates sometime in the future. Great question.
Speaker 1: Obviously Chair Power will try to do just that. It's
Speaker 1: obvious that we have to have some sort of clear
Speaker 1: taper signals. There's no reason for the Central Bank to
Speaker 1: be providing large asset purchases to bolster aggregate demand. What
Speaker 1: inflation is high and supply is the problem. At the
Speaker 1: same time, a lot of people realize the dot plots
Speaker 1: are shifting the possibility of a rate increase into But
Speaker 1: I would expect Chair Powell to put off that discussion
Speaker 1: if you can, during the press conference. But you're right,
Speaker 1: it will come up, and it should. Glenn Hubbard, my
Speaker 1: book of the year is In Defense of Public Debt.
Speaker 1: I announced that quickly yesterday at Granted this is Barry
Speaker 1: Ike and Green's tour to force on public debt. You
Speaker 1: are the single greatest spokesman of responsible not supply side theory,
Speaker 1: but a more conservative theory. He opens his book with
Speaker 1: a senator from Kentucky, the junior senator from Kentucky, giving
Speaker 1: a traditional public at fear line. Speak to conservatives in America,
Speaker 1: what do they get wrong about our ability to solve
Speaker 1: this public debt crisis we're in. Well, it's a great question, Tom,
Speaker 1: and debt for a household, for a business, for a country,
Speaker 1: whether it's good or bad depends on what you're using
Speaker 1: it for. So the use of debt for the future,
Speaker 1: fighting a war, infrastructure, part of even your ongoing budget
Speaker 1: may make sense. The problem is when debt becomes UH
Speaker 1: completely wrapped up into large social programs that are unfunded.
Speaker 1: That's not just an American problem, it's a it's a
Speaker 1: global problem. So the issue is not necessarily how high
Speaker 1: debt is relative to GDP, but what we're doing for it,
Speaker 1: and eventually, of course that debt has to be UH.
Speaker 1: The ancient glen, the ancient conservative issue is if the
Speaker 1: Senator from Vermont comes out with three point five trillion
Speaker 1: dollars of social programs, whether it's to run doesn't matter,
Speaker 1: it will not be applied correctly. Do you see where
Speaker 1: we can have a two part fiscal expansion now where
Speaker 1: we can have confidence it will be applied productively. I do,
Speaker 1: and it's different than what we're talking about. So Part
Speaker 1: one is already on the table, which is something akin
Speaker 1: to the bipartisan Infrastructure Bill. Even that bill is more
Speaker 1: in it than I would call infrastructure, but it's certainly
Speaker 1: a very good bill. A second part would be more
Speaker 1: opportunity focused, helping to connect and reconnect everybody to the economy.
Speaker 1: You can do that much more cheaply than the vast
Speaker 1: non means tested expansion of social programs and Senator standards
Speaker 1: and others or suggest So is the three and a
Speaker 1: half trillion dollar price tag to high? Glenn? Well, yes,
Speaker 1: but I don't even think that's the question. The question
Speaker 1: is not whether it's one and a half or three
Speaker 1: and now, but what is it? And if it's a
Speaker 1: massive expansion of the state in new entitlement programs, that's
Speaker 1: something we ought to ask. Are we promoting work and
Speaker 1: opportunity or were doing something else? That to me is
Speaker 1: the threshold question. But yes, the price tag is too high.
Speaker 1: There's no credible pay fors for a bill that size. Well,
Speaker 1: the pay for is being considered are many, and they're
Speaker 1: higher taxes in many shapes and forms. What do you
Speaker 1: think the growth impact of that is? If those pay
Speaker 1: fors do indeed mean that Americans, granted wealthier ones, have
Speaker 1: to pay more, what depends on the pay for? You know,
Speaker 1: obviously the economy of will survive a modest increase in
Speaker 1: the corporate tax. I don't think it's a good idea
Speaker 1: of it will certainly be survived. But the small increases
Speaker 1: in capital taxes that might have a chance of being
Speaker 1: enacted are too small to really pay for anything like
Speaker 1: this bill, and assumptions like savings and drug prices are
Speaker 1: a remaking of a system, not really a pay for
Speaker 1: it a conventional set. So the numbers just don't add up. Number.
Speaker 1: What does Chairman Powell not want to say today? What's
Speaker 1: a single thing where he needs to be signed? Well,
Speaker 1: I would guess from his perspective he would rather punt
Speaker 1: on the discussion of the path for rates as opposed
Speaker 1: to tapering. He probably also would like to avoid talking
Speaker 1: about the other taper that's happening, which is the change
Speaker 1: in the rate of growth of fiscal stimulus. Obviously, that
Speaker 1: is a taper that will be affecting the economy too,
Speaker 1: and I doubt he wants to weigh into that. Glenn,
Speaker 1: thank you as always fantastic to catch up with. Glen
Speaker 1: That the Columbia Business School dean emeritus and former Council
Speaker 1: of Economic Advisors Chairman. It's what's so important here, John,
Speaker 1: is the idea of will I go full brid We
Speaker 1: know the measurement of you going full Yank in black rocket.
Speaker 1: Mr Fink have decided we need the British to go
Speaker 1: full Yank in America. And our next guest is she's
Speaker 1: she's gone full You want to have this discussion with
Speaker 1: a wonderful fund manager. Yeah, she is makes comes strategists
Speaker 1: like Marin Watson. You want to do that now, which no,
Speaker 1: we do right now. We can talk to her about
Speaker 1: the serious issues. But she's an example of the international
Speaker 1: zai absolutely. Marilyn. Did you find that you lost your
Speaker 1: tease early on? Is that what happened? I think I
Speaker 1: have lost them a little bit. I'm trying hard, not
Speaker 1: too though. I'm trying to keep them, but trying to
Speaker 1: slip might slip to Marilyn. It's great a catch up
Speaker 1: with the Marilyn Watson here with this black Rock head
Speaker 1: of global fundamental fixed income strategy. Marilyn, let's just start
Speaker 1: with today and the Federal Reserved Chairman. Something we've mentioned
Speaker 1: through the morning how difficult it will be to communicate
Speaker 1: that the decision ultimately on Que's divorced from a decision
Speaker 1: on rates doesn't set the clock ticking when the dot
Speaker 1: plot is going to be in the mix as well. Yeah,
Speaker 1: I think already they've done a relatively good job of
Speaker 1: trying to decouple tapering quee with a rising interest rates.
Speaker 1: I think they've been trying to signal that, and I
Speaker 1: think they have done a relatively good job. I think
Speaker 1: going into today, the market is expecting to maybe hear
Speaker 1: a little bit more around tapering, but they're not expecting
Speaker 1: too much. Maybe, um, something will change in the forward
Speaker 1: guidance about you know, substantial further progress being made UM,
Speaker 1: and you know, the market, I think, you know, the
Speaker 1: consensus is that tapering will start at some point before
Speaker 1: the end of this year. UM. In terms of the dots,
Speaker 1: that is something that we and I think most market
Speaker 1: participants will be keeping a very very keen eye on,
Speaker 1: particularly as we see um, you know, maybe maybe an
Speaker 1: adjustment two. It's hard to see, but we'll also get
Speaker 1: the nuance scored twenty four and at the moment, it
Speaker 1: probably looks like the Federal still probably be suggesting in
Speaker 1: adopt loots that you maybe have three great hikes in
Speaker 1: twenty twenty three and three and twenty twenty four. But
Speaker 1: I think that's so far done a pretty good job
Speaker 1: of keeping a tapering queue and a changing interest rate's
Speaker 1: pretty well separated. Well. You do a world class job
Speaker 1: of synthesizing all that you read and fixed income dynamics,
Speaker 1: what do you anticipate the real you will do well.
Speaker 1: So it's interesting if you look at the behavior of
Speaker 1: the U S real yield versus h you European rates,
Speaker 1: or you actually see that, you know, in relative terms,
Speaker 1: actually it takes a little bit higher um and I
Speaker 1: think if you do start to see it, it depends
Speaker 1: the messaging taking away from this meeting, and if we
Speaker 1: do get further guidance on you know, tapering towards the
Speaker 1: end of the year, maybe the dots as well, if
Speaker 1: it's perceived to be a bit more dovish, then I
Speaker 1: do think you will start to see you know, you'll
Speaker 1: subb to see the dollar tick down, and you'll see
Speaker 1: an impact on bill hills as well. But at the moment,
Speaker 1: I think we would expect to see real yields continue
Speaker 1: to basically tick up a little bit more if we
Speaker 1: do get the FED you know, signaling that they are
Speaker 1: going to continue with the framework of tapering before the
Speaker 1: end of this year, and also the pace will be
Speaker 1: important as well. I doubt Maryland that the dead ceiling
Speaker 1: in today's decision is going to have any real bearing
Speaker 1: for the FED, But for the bond market, is there
Speaker 1: a real fear there around the potential of that suspension
Speaker 1: not being extended. Well, I think it's definitely another layer
Speaker 1: of uncertainty to add to the myth mix, and it's
Speaker 1: certainly another risk. I think, Um, you know, not to
Speaker 1: be fully discounting it, because it is it is a
Speaker 1: risk that is still there. But you know, on the
Speaker 1: base scenario it is that something will be agreed. But
Speaker 1: I think if you add that to to COVID, you
Speaker 1: add it to the news around growth generally in China
Speaker 1: and elsewhere as well. Um, it's just another factor that
Speaker 1: I think will maybe contribute a little bit more to
Speaker 1: the ongoing volatility that we're seeing at the moment, perhaps
Speaker 1: more in the exuerty market than actually in the fixing
Speaker 1: com market at the moment. But as you say, I
Speaker 1: think it is definitely a risk, and I think it
Speaker 1: is to a certain extent big priced in. But at
Speaker 1: the moment um, you know, I think the general consensus
Speaker 1: that will be some sort of agreement, but most there
Speaker 1: always is China will deal with it. China will deal
Speaker 1: with it. Marian, Thank you. Mann Watson. Black Rock Head
Speaker 1: a global fundamental fixed income strategy. GM four A is
Speaker 1: standing by he could join in this conversation. Airbus is
Speaker 1: holding a sustainability day to day down in to lose
Speaker 1: this clearly ahead of COP twenty six GM. Welcome to
Speaker 1: the program. Thank you very much, D for your time
Speaker 1: this morning. You said this morning, and we'll talk about
Speaker 1: sustainability first. You said this morning that you are becoming
Speaker 1: quote more confident in your ability to deliver a hydrogen
Speaker 1: airplane by twenty five GM. The physics and the chemistry
Speaker 1: is incredibly complicated. What gives you that confidence. The physics
Speaker 1: is complicated, but the physics works. Hydrogen technologies are not new.
Speaker 1: They are used in in other sectors. We use them
Speaker 1: in space on our rockets, and we don't need the
Speaker 1: loads of physics to change to be able to use
Speaker 1: hydrogen on our planes. So every day we become more confident.
Speaker 1: But we think we need to have a plane. We
Speaker 1: need to have the right fuel, the hydrogen available in
Speaker 1: the right quantity at the right place at the right time,
Speaker 1: and we need the regulations to be ready. So we
Speaker 1: really need the work and the collaboration of many people
Speaker 1: are on the globe to make it happen. And that's
Speaker 1: why we have the summit to create that momentum and
Speaker 1: make sure we have the right level of collaboration to
Speaker 1: make it happen on time. What problems do you still
Speaker 1: need to solve, what needs fixing, and what kind of
Speaker 1: aircraft should we be thinking about. Is this kind of
Speaker 1: a turbo prop sized aircraft a smaller aircraft all were
Speaker 1: thinking about a replacement for the eight three twenty family.
Speaker 1: The technology needs to be introduced in planes in aviation,
Speaker 1: so we we need to be able to deliver the
Speaker 1: fuel at the airport, to use the plane on board,
Speaker 1: to store it, to burn it, or to use it
Speaker 1: in a fuel cell um. There's a lot at stake
Speaker 1: at the moment we are looking at those technologies, so
Speaker 1: it's not really about solving problem ms. It's about understanding
Speaker 1: the way we can use the different technologies and then
Speaker 1: selecting the right ones. When it comes to the plane themselves,
Speaker 1: Hydrogen as different characteristics compared to carosine. There is a
Speaker 1: higher weight density of hydrogen compared to carosine, so it's
Speaker 1: good from the weight standpoint, but it takes more volume
Speaker 1: for the same quantity of energy, So the planes we'll
Speaker 1: have probably a different shape at different architecture, and we
Speaker 1: will use less hydrogen in terms of weight less hydrogen
Speaker 1: on board than with carosin. So we believe we're gonna
Speaker 1: start with a short and mid range aircraft before it
Speaker 1: goes to longer distances or other smaller planes at the beginning,
Speaker 1: which is also something reasonable to consider when you look
Speaker 1: at the investment that will be required. So smaller investments
Speaker 1: for smaller planes easier go to market um and more
Speaker 1: convenient when it comes to the use of hydrogen. Gim
Speaker 1: we will just check thing about the North Atlantic and
Speaker 1: figuring out exactly what kind of impacts President Biden's decision
Speaker 1: to reopen the North Atlantic is going to have. What
Speaker 1: is your perspective on this, When do you think that
Speaker 1: we're gonna start seeing the reopening translating into new orders,
Speaker 1: new white body orders for Airbus. You make a very
Speaker 1: good connection between the reopening of the North Atlantic and
Speaker 1: the white body situation. Actually, what we see at the
Speaker 1: moment is a recovery on domestic flights, original flights um
Speaker 1: and therefore the production increase at their bus on the
Speaker 1: narrow bodies, on the single lined business the E three
Speaker 1: twenty family. But we are still at a very low
Speaker 1: pace when it comes to white bodies. It's the beginning
Speaker 1: of the process. I hope that the reopening of the
Speaker 1: North Atlantic we trigger other positive news when it comes
Speaker 1: to long distance flights, but it's a bit premature. So
Speaker 1: we're very happy to see this first milestone. That was
Speaker 1: the most important one and probably the easier to get
Speaker 1: UM on the on the long distance UH situation, So
Speaker 1: very good news for the industry. We need to get
Speaker 1: it right. I think this is gonna be okay. It's
Speaker 1: very important for the US and European airlines will very
Speaker 1: much help in general in the path to recovery. So
Speaker 1: we're very happy with it. Um Um. Some in the
Speaker 1: market is starting to believe that you will easily beat
Speaker 1: your six hundred delivery target for this year. Um I'm
Speaker 1: wondering though, whether actually supply chain issues could end up
Speaker 1: having quite a negative impact. What are you seeing in
Speaker 1: the supply chain right now? Any chip shortages, any material shortages.
Speaker 1: What do you think the energy crisis in Europe is
Speaker 1: gonna mean? Do you think you're gonna have any impact
Speaker 1: from that? Actually, we continue to operate in a very challenging,
Speaker 1: complex and unpredictable environment. We've delivered roughly three hundred planes
Speaker 1: in the first half, so six hundred for the fullier
Speaker 1: is something that really makes sense from our perspective. UM.
Speaker 1: The supply chain situation is challenging. They're really in a
Speaker 1: difficult spot. As I said earlier, we're working very closely
Speaker 1: with the supply chain. We're happy of what has been
Speaker 1: achieved in the last eighteen months against the backdrop of
Speaker 1: this incredible crisis, but now that we start to ramp up,
Speaker 1: we see some difficulties. Our suppliers have challenges in accessing
Speaker 1: raw material, including on the prices of raw material UM,
Speaker 1: to reopen plants, to rehire or hire people for the
Speaker 1: ramp up in this challenging situation, it's not easy UM,
Speaker 1: and we are prudent when it comes to the speed
Speaker 1: of recovery of our production. So again we believe the
Speaker 1: six hundred target we have given to ourselves is a
Speaker 1: realistic one. Always the pleasure. Thank you for your time.
Speaker 1: Thank you for sharing a little bit of what you're
Speaker 1: thinking about the sustainability story UH and how it's going
Speaker 1: to progress from here. GM four, the CEO of a US.
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