WEBVTT - Surveillance: Rocket Hit in Poland

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<v Speaker 1>Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keane. Along

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<v Speaker 1>with Jonathan Farrell and Lisa Abramowitz. Daily we bring you

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<v Speaker 1>insight from the best and economics, finance, investment, and international relations.

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<v Speaker 1>To find Bloomberg Surveillance on Apple Podcast, sun Cloud, Bloomberg

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<v Speaker 1>dot Com and of course on the Bloomberg terminal. It

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<v Speaker 1>is such an honor, and this is before the news

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<v Speaker 1>of yesterday on a missile, and this is south of Belarus,

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<v Speaker 1>on the Polish border with Ukraine, that you get to

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<v Speaker 1>turn Paul Sweeney as I have this morning to Elliott

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<v Speaker 1>Ackerman of the Marine Corps, and now James Travitas of

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<v Speaker 1>the U. S. Naval Academy and his service to the

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<v Speaker 1>nation as Supreme Commander of NATO as well. Almost Tavidis,

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<v Speaker 1>thank you so much for joining us this morning. There

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<v Speaker 1>is in her book two thousand thirty four, my book

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<v Speaker 1>of this summer a few years ago, folks. I can't

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<v Speaker 1>say enough about about it. On the first page of

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<v Speaker 1>the South China Sea. How many times over her career

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<v Speaker 1>has she stood as she did now on the bridge

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<v Speaker 1>of a ship, observing this miracle of stillness. There was

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<v Speaker 1>a stillness in Poland yesterday. That appears to be violated

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<v Speaker 1>by chance. How afraid should we be of exhaustion a

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<v Speaker 1>war that goes on and a war that goes on

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<v Speaker 1>to the winter where chance overtakes us. We gotta wake

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<v Speaker 1>up call yesterday. And it turned out as well as

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<v Speaker 1>it possibly could have. Tom, Um, let's face it, that

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<v Speaker 1>could have been a deliberate attack by Russia. It would

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<v Speaker 1>be crazy for Putin to start a war with NATO,

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<v Speaker 1>particularly by firing missiles into a field in Poland, but

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<v Speaker 1>could have been deliberate. It could have been in a

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<v Speaker 1>Russian offensive missile that went extremely stupid, and we've seen

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<v Speaker 1>several instances of that. Turns out apparently it's it's a

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<v Speaker 1>Ukrainian air defense missile, entirely justified in its use. But

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<v Speaker 1>here's the point, Tom. Wars sometimes start on incidents that

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<v Speaker 1>people overreact to move too quickly. I think, Tom, you

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<v Speaker 1>and I are old enough to remember the Tonkin Gulf

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<v Speaker 1>incident kind of preciprocated Vietnam or the assassination of an

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<v Speaker 1>archduke that starts World War One. I wasn't there for that,

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<v Speaker 1>than you are you sure? In any event, Um, we

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<v Speaker 1>gotta wake up call about how dangerous this situation is,

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<v Speaker 1>and we are to pay attention. And you are expert

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<v Speaker 1>in this. Paul Sweeney wants to jump in here, but

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<v Speaker 1>very quickly, Admiral, our solution in America is our modern

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<v Speaker 1>technocracy are technocratic engineering. We've got the toys, we got

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<v Speaker 1>the radar, we've got the planes. But that doesn't work

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<v Speaker 1>in a ward, does it. You gotta have the technology.

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<v Speaker 1>But I would argue, we got people, We know what

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<v Speaker 1>we're doing. We have been in a lot of combat operations.

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<v Speaker 1>Our opponents Russia looking like they're flailing badly here. China

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<v Speaker 1>hasn't been in a sustained war since the nineteen fifties. Um,

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<v Speaker 1>we have a strong advantage in our people. We are

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<v Speaker 1>to be confident in that, and we are to understand

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<v Speaker 1>that hopefully that creates real deterrence against these other powers. Admiral, So,

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<v Speaker 1>given what we kind of feared yesterday, which might have

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<v Speaker 1>been an escalation of some sort against what appears to

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<v Speaker 1>be a brutal winter coming up and who knows how

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<v Speaker 1>to play out, should we be thinking about ways to

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<v Speaker 1>give Mr putin Away out of this thing, Because from

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<v Speaker 1>his perspective, he's got to recognize that this is at

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<v Speaker 1>best just a stalemate. He should be awakening. But I think, uh, Paul,

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<v Speaker 1>he wants to play a couple of cards. Yet he

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<v Speaker 1>wants to wait and see how the winter comes out.

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<v Speaker 1>You know, as the Europeans struggle with high energy costs

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<v Speaker 1>and a cold winner is it a warm winner. He

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<v Speaker 1>wants to see if there's impact there. And he is

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<v Speaker 1>also waiting to see how divisive are politics here are

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<v Speaker 1>in the United States. I think the mid terms probably

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<v Speaker 1>gave him some pause. That was not a good outcome

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<v Speaker 1>for him, and I think as the winner goes on, um,

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<v Speaker 1>I think the Europeans are gonna stand pretty strong. So

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<v Speaker 1>point being, yes, this thing will end up in a negotiation.

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<v Speaker 1>I think it probably head stored negotiation after the winter,

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<v Speaker 1>when both sides are facing real exhaustion. Putin because he

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<v Speaker 1>runs out of resources, Zelinsky because the patients the resources

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<v Speaker 1>of the West become harder to obtain. I think that

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<v Speaker 1>drives both parties potentially to negotiation early next marine. Let's

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<v Speaker 1>hope so Emial Stevids. Thank you so much again, Elliott

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<v Speaker 1>Ackerman and James Travidas. The book is two thousand thirty four.

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<v Speaker 1>It has my highest highest recommend dation. Elliott Ackerman joins

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<v Speaker 1>us to say he's former White House fellow US Marine

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<v Speaker 1>Corps veteran, is to miss the point of my book

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<v Speaker 1>of the Summer a number of summers ago. The book

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<v Speaker 1>is two thousand thirty four, a novel of the next World,

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<v Speaker 1>except the next world is coming ever closer. Eliott Ackerman,

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<v Speaker 1>thank you so much for joining us today. Let me

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<v Speaker 1>start with the basic reconninance, reconnaissance issues of a missile attack.

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<v Speaker 1>Do we have, as the West, or as America, or

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<v Speaker 1>as NATO, do we have intelligence systems from space or

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<v Speaker 1>from ground that know where various and sundry missiles move?

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<v Speaker 1>We do. Generally speaking. What we have is what's called

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<v Speaker 1>counter battery radar. So you can uh with with basic math,

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<v Speaker 1>figure out the trajectory of these missiles, the direction of impact,

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<v Speaker 1>and where they have come from. So, I mean, that's

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<v Speaker 1>basically how we've seen NATO very quickly figure out that

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<v Speaker 1>this missile that landed in Poland was in fact launched

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<v Speaker 1>from Ukraine. The dystopian nature of your book two thousand

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<v Speaker 1>thirty four, without giving the plot away, is that when

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<v Speaker 1>adversaries come together, the biggest problem is mistakes. The biggest

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<v Speaker 1>problem is risks as you perceive Ukraine and Russia into

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<v Speaker 1>the winter. Is that the problem. They're worn out, Their

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<v Speaker 1>exhausted systems are failing. They're just close. So like your book,

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<v Speaker 1>things fall apart rapidly. Well, exactly, you hit the nail

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<v Speaker 1>right on the head that you know, wars are escalatory

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<v Speaker 1>by nature, and once you enter uh this escalatory cycle, Uh,

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<v Speaker 1>it's us picks up and picks up, and each incident

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<v Speaker 1>becomes increasingly dangerous. You know. That's why we see the

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<v Speaker 1>Secretary General of NATO caution, caution in calm, because all

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<v Speaker 1>sides don't want to see the war in Ukraine spill

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<v Speaker 1>outside of the borders of Ukraine, which would be disastrous,

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<v Speaker 1>and that calm wasn't there yesterday The Foreign Minister of

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<v Speaker 1>Ukraine put this tweet out fourteen hours ago. I want

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<v Speaker 1>to read it at because I think it's important. He said,

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<v Speaker 1>Russia now promotes a conspiracy theory that it was allegedly

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<v Speaker 1>a missile of Ukrainian air defense that found on the

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<v Speaker 1>Polish territory, which is not true. Now we should by

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<v Speaker 1>Russian propaganda or amplify its message. Hasn't that just been

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<v Speaker 1>totally contradicted by the NATO Secretary General just moments ago.

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<v Speaker 1>Well it has and it's you know, it's an important

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<v Speaker 1>reminder that, you know, although Russia is waging an illegal

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<v Speaker 1>war in Ukraine, and although the Western nator are supporting

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<v Speaker 1>the Ukrainian people, it obviously has to be well within

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<v Speaker 1>a rational context. We can't go fly off handle each

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<v Speaker 1>time that there is an incident or the war spills

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<v Speaker 1>over in unfortunate ways. So I think NATO is doing

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<v Speaker 1>the right thing. Um, you know, I don't necessarily, I

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<v Speaker 1>wouldn't necessarily say the Ukrainians are are doing the wrong thing,

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<v Speaker 1>but I think you can expect, you know, they are

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<v Speaker 1>in a crisis situation that they reality they've been living

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<v Speaker 1>in since February, an existential war fought on their land, uh,

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<v Speaker 1>and we need to be good partners and helping them

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<v Speaker 1>manage that war and hopefully bring it to a successful conclusion.

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<v Speaker 1>Does it Botherly, the Elliott that perhaps Russia has a

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<v Speaker 1>bit more leverage because they're backed into a corner and

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<v Speaker 1>it's Vladimir Putin's pride and he could act in a

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<v Speaker 1>more rash way because he doesn't really care what the

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<v Speaker 1>West does to him at this point, because of just

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<v Speaker 1>simply their reluctance to engage in a conflict. Sure, I

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<v Speaker 1>think that you know that is obviously uh a point

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<v Speaker 1>that that we need to weigh. You know, Russia is

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<v Speaker 1>backed into a corner prutent, it would see, doesn't have

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<v Speaker 1>that much left to lose. Um, if you want to

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<v Speaker 1>look at the nation that really has nothing left to lose,

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<v Speaker 1>it's I mean it's Ukraine. I mean, Ukraine is fighting

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<v Speaker 1>for its very existence, it's very life. The thing that

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<v Speaker 1>concerns me the most is that I think we, by we,

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<v Speaker 1>I mean sort of a collective West, have in the

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<v Speaker 1>last decade or two of warfare, gotten into a psychology

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<v Speaker 1>where wars are very long. They're photos of five ten

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<v Speaker 1>as we sign up against an even twenty year periods.

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<v Speaker 1>The war in Ukraine is a different type of war.

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<v Speaker 1>It's a bit of a throwback. When I've been there

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<v Speaker 1>to cover the war, I mean, their air raids are

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<v Speaker 1>running down to bomb shelters. It feels like a twentieth

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<v Speaker 1>century war. And it's a ward that needs to be

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<v Speaker 1>resolved really in the next year or two. And if

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<v Speaker 1>the war bleeds over into three, four or five ten years,

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<v Speaker 1>that only advantages the Russians. And the wonderful to hear

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<v Speaker 1>from you, as always said at him in that I

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<v Speaker 1>can stay unequivocally on the island of Manhattan. There is

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<v Speaker 1>no one steeped Inness and Dana Telsey CEO, Chief Research Officer,

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<v Speaker 1>Telsey Advisory Group kind of get Bear Stearns years ago.

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<v Speaker 1>And Dana, I want you to fifty seven and fifth Avenue,

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<v Speaker 1>give us one little window into your childhood at Bergdorf

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<v Speaker 1>Bergdorf Goodman. Give us just one little moment there in

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<v Speaker 1>your childhood. I think the moment at Bergdorf Goodman comes

0:10:26.840 --> 0:10:29.920
<v Speaker 1>from my grandmother working at Bergdorf Goodman and going in

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<v Speaker 1>and seeing that on the house wears floor, seeing all

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<v Speaker 1>the different Christmas trees and holiday decorations they have. It

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<v Speaker 1>changes every year, and it's a wow. Every year. We're

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<v Speaker 1>coming off a pandemic that your grandparents never could have

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<v Speaker 1>imagined it was over in nineteen No, it was not.

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<v Speaker 1>What does the holiday season look like this year? I

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<v Speaker 1>think the holiday season, for the most part, is going

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<v Speaker 1>to be about gathering. I think people want to be

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<v Speaker 1>together more than they ever have in the past. But

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<v Speaker 1>I think it's still a challenge holiday season economically. Yes,

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<v Speaker 1>three tail sales figures came out, but you have a

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<v Speaker 1>real bifurcation between the high end and the low end.

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<v Speaker 1>The high end still spending, but the growth rate of

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<v Speaker 1>that high end spend is moderating from what it had

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<v Speaker 1>been in the past. And what we need. You need

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<v Speaker 1>new product and who's delivering new product. You and I

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<v Speaker 1>talked about the Trunk's exhibition at Louis Vuitton on Madison Avenue.

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<v Speaker 1>That's new. You look at Deckers and they have new

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<v Speaker 1>Uggs platform shoes that are taking off on running. If

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<v Speaker 1>you don't have the waffle soul, that is pretty good too.

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<v Speaker 1>But that's the luxury sector. This is the people who

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<v Speaker 1>have discretionary spending. We just saw from the targets of

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<v Speaker 1>the world. Maybe that's not the case for the vast

0:11:36.360 --> 0:11:39.040
<v Speaker 1>majority of other people. What is your takeaway in terms

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<v Speaker 1>of the discretionary spending ability in mass from the Target

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<v Speaker 1>and Walmart earnings, It's cautious when you think about the

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<v Speaker 1>inflation hairy headwinds that they have. They don't have the

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<v Speaker 1>same spending power that they did before, especially when food

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<v Speaker 1>is going up as as much as it did. You

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<v Speaker 1>look where the value is. Everyone's competing on promotion today,

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<v Speaker 1>which is different than three hundred and sixty five day

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<v Speaker 1>years ago. But you look at t J access numbers

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<v Speaker 1>today which are better than expected, and frankly, even the guidance,

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<v Speaker 1>it was nice to see how they're setting up. They're

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<v Speaker 1>getting better brands at more value prices, and so is

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<v Speaker 1>there some share shifts that's going on and is off

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<v Speaker 1>price returning. It's a great point, especially because we saw,

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<v Speaker 1>for example, Walmart gain share in the grocery store sector,

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<v Speaker 1>which actually buffered a lot of their sales right because

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<v Speaker 1>people are still buying food and you're seeing that, where

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<v Speaker 1>do you expect to see the big share shifts? How

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<v Speaker 1>much do you see consolidation among the strongest players and

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<v Speaker 1>the loser is really losing even bigger. I think overall,

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<v Speaker 1>when we're thinking about the changes that are going on,

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<v Speaker 1>who has the assortment and who has value? I think

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<v Speaker 1>one of the surprises tomorrow could be Macy's and I

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<v Speaker 1>think they've been more innovative than they have been in

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<v Speaker 1>the past, and I think we're gonna see some improvement there.

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<v Speaker 1>I think overall we're seeing on the specialty apparel side,

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<v Speaker 1>there's newness there. You look at a Ritzia who's been

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<v Speaker 1>taking share and I think the issues at the gap

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<v Speaker 1>continue to remain headwinds. I think they are shared donors,

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<v Speaker 1>not share gainers in the in the near term. And

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<v Speaker 1>I think when we do have all of the changes

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<v Speaker 1>that are happening, you take a look at urban outfitters

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<v Speaker 1>with anthropology and free people, where I think that a

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<v Speaker 1>little bit higher income and women are buying. I think

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<v Speaker 1>there's a benefit there. The teen retailers are having issues

0:13:18.200 --> 0:13:21.480
<v Speaker 1>because they don't have the discretionary spend, so it's a

0:13:21.520 --> 0:13:24.840
<v Speaker 1>it's a share shift. And let's not forget inventory levels.

0:13:25.080 --> 0:13:27.679
<v Speaker 1>We have too much inventory. No one is getting rid

0:13:27.679 --> 0:13:29.800
<v Speaker 1>of it as fast as they would like, and that's

0:13:29.800 --> 0:13:32.000
<v Speaker 1>going to mean a bargain for the consumer. So where's

0:13:32.000 --> 0:13:33.880
<v Speaker 1>the value in equity here? I want to go back

0:13:33.880 --> 0:13:36.000
<v Speaker 1>to the central statement, which, as we talk about and

0:13:36.120 --> 0:13:39.960
<v Speaker 1>Lisa needs a pair of statement sunglasses, very important UH

0:13:40.280 --> 0:13:44.319
<v Speaker 1>to have in a recession. Do you go long luxury

0:13:44.400 --> 0:13:47.800
<v Speaker 1>which is already richly priced, or do you find value

0:13:47.840 --> 0:13:50.360
<v Speaker 1>in troubled big box or something else. I don't know.

0:13:50.800 --> 0:13:52.520
<v Speaker 1>One of the things I'm seeing with so many of

0:13:52.520 --> 0:13:55.440
<v Speaker 1>my stocks at fifty two week lows. I think investors

0:13:55.440 --> 0:13:58.000
<v Speaker 1>are doing their homework on the names preparing for twenty

0:13:58.000 --> 0:14:00.599
<v Speaker 1>three and twenty four. The tail when next year is

0:14:00.640 --> 0:14:03.280
<v Speaker 1>about lower freight rates, the headwind is weird. Give me

0:14:03.320 --> 0:14:05.000
<v Speaker 1>a single best buy here, you're with us or no

0:14:05.000 --> 0:14:07.360
<v Speaker 1>one's watching. Come on, Andy's single best buy right now.

0:14:07.600 --> 0:14:09.560
<v Speaker 1>When I think the names out there that are interesting,

0:14:09.760 --> 0:14:11.560
<v Speaker 1>I mean I like t j X for what they

0:14:11.600 --> 0:14:13.880
<v Speaker 1>can continue to deliver. But I think there's other names

0:14:13.920 --> 0:14:16.280
<v Speaker 1>that are interesting also when I think of names like

0:14:16.600 --> 0:14:19.160
<v Speaker 1>Loi est Lauder just delivered. If you have to look

0:14:19.200 --> 0:14:21.440
<v Speaker 1>at some of the value names out there and what

0:14:21.560 --> 0:14:24.200
<v Speaker 1>could be a change, I think Abercrombie and Fitch. I

0:14:24.240 --> 0:14:27.040
<v Speaker 1>think the newness that they're the other day and what

0:14:27.040 --> 0:14:30.240
<v Speaker 1>did you think I was kidding? Okay, I'm going to

0:14:30.280 --> 0:14:31.680
<v Speaker 1>line up to go in an A and F. You

0:14:31.720 --> 0:14:33.400
<v Speaker 1>don't have to line up, you can walk in and

0:14:33.440 --> 0:14:37.360
<v Speaker 1>you're gonna get you say ladder, But tom Ford and

0:14:37.360 --> 0:14:40.000
<v Speaker 1>that's what we're talking about, the biggest purchase in its history.

0:14:40.400 --> 0:14:43.200
<v Speaker 1>I am wondering there is this theory out there put

0:14:43.240 --> 0:14:45.560
<v Speaker 1>forward by the likes of Morgan Stanley, that at some

0:14:45.640 --> 0:14:48.160
<v Speaker 1>point there'll be a tipping point next year and these

0:14:48.200 --> 0:14:50.600
<v Speaker 1>will be the names that will benefit the most is

0:14:50.680 --> 0:14:53.000
<v Speaker 1>there going to be a roll up in between? Will

0:14:53.040 --> 0:14:55.720
<v Speaker 1>there be some sort of consolidation or bankruptcies that have

0:14:55.800 --> 0:14:58.800
<v Speaker 1>not yet been experienced. I think you'll continue to see

0:14:58.840 --> 0:15:01.920
<v Speaker 1>some of the acquisitions take place in consolidation, but I

0:15:01.920 --> 0:15:04.240
<v Speaker 1>think you're also going to see the vestures some of

0:15:04.240 --> 0:15:07.360
<v Speaker 1>the companies that maybe not having had performed as well

0:15:07.360 --> 0:15:09.480
<v Speaker 1>and want to focus on brands that are working. You

0:15:09.520 --> 0:15:12.400
<v Speaker 1>look at a Wolverine Worldwide, for example, where the maryl

0:15:12.480 --> 0:15:14.920
<v Speaker 1>business is their strength. They may not need all the

0:15:14.920 --> 0:15:17.360
<v Speaker 1>other brands in their portfolio. So I think you're gonna

0:15:17.360 --> 0:15:20.240
<v Speaker 1>see both. And I also think you may see a

0:15:20.440 --> 0:15:23.920
<v Speaker 1>change up in terms of the physical locations becoming more important.

0:15:24.280 --> 0:15:28.040
<v Speaker 1>I think stores are the new gathering spots and pandemic

0:15:28.080 --> 0:15:31.600
<v Speaker 1>did is they basically brought together that people want to socialize,

0:15:31.920 --> 0:15:34.920
<v Speaker 1>and frankly, you look at as the pandemic hopefully goes

0:15:34.960 --> 0:15:38.000
<v Speaker 1>into the rear view that yes, you are seeing people

0:15:38.080 --> 0:15:41.080
<v Speaker 1>shop at stores. It's one of the changes for Holiday

0:15:41.640 --> 0:15:44.320
<v Speaker 1>China to the rescue. That's a big theme that's out there,

0:15:44.360 --> 0:15:47.680
<v Speaker 1>isn't it doesn't work, not yet. I'm still seeing China

0:15:47.720 --> 0:15:50.840
<v Speaker 1>being being a tough place for a lot of my brands.

0:15:51.080 --> 0:15:53.200
<v Speaker 1>I think it's not until twenty three. Bring Joe Pelman

0:15:53.280 --> 0:16:01.280
<v Speaker 1>next time. Dana Telson where Advisory Group AMY with SILVERMA

0:16:01.360 --> 0:16:05.240
<v Speaker 1>joined just now, I Couity, Derivative Strategistic obviously Capital Markets Amy.

0:16:05.400 --> 0:16:08.040
<v Speaker 1>Can we kill this amount up the last week? And

0:16:08.120 --> 0:16:09.840
<v Speaker 1>what do you make of this Runnie we've seen from

0:16:09.840 --> 0:16:14.120
<v Speaker 1>the nast act to the SMP. Yeah, I think melt

0:16:14.200 --> 0:16:16.400
<v Speaker 1>up is an accurate way to describe it. Look, it

0:16:16.720 --> 0:16:18.720
<v Speaker 1>feels like a lifetime ago, but you know one week

0:16:18.760 --> 0:16:21.920
<v Speaker 1>ago is when we got that CPI number, and options

0:16:21.920 --> 0:16:25.400
<v Speaker 1>were you know, somewhat of a culprit outside of fundamental information.

0:16:25.440 --> 0:16:28.480
<v Speaker 1>About one third of all SMP options that traded that

0:16:28.560 --> 0:16:31.720
<v Speaker 1>day were for that expiration on that Wednesday, and that

0:16:31.840 --> 0:16:34.800
<v Speaker 1>certainly exacerbates some of the moves you see. Now we've

0:16:34.840 --> 0:16:38.400
<v Speaker 1>gotten to a point, John, in terms of positioning where

0:16:38.440 --> 0:16:41.760
<v Speaker 1>you know, essentially investors are are selling calls and and

0:16:41.920 --> 0:16:44.840
<v Speaker 1>basically just watching a grind up. So you know, they

0:16:44.840 --> 0:16:47.720
<v Speaker 1>were very worried about participating in that upside. But we

0:16:47.800 --> 0:16:51.480
<v Speaker 1>haven't seen reinitiation of even new levels from here, so

0:16:51.520 --> 0:16:54.520
<v Speaker 1>I think from the options perspective, they kind of think, again,

0:16:54.560 --> 0:16:56.360
<v Speaker 1>it's a melt up, but not a rip up. I mean,

0:16:56.360 --> 0:16:58.640
<v Speaker 1>I'm gonna go to your research note where you mentioned

0:16:58.640 --> 0:17:01.760
<v Speaker 1>bitcoin and your study of the bitcoin moves and all

0:17:01.800 --> 0:17:04.399
<v Speaker 1>the uproar that's ensued, and I want to go to

0:17:04.480 --> 0:17:08.200
<v Speaker 1>quantitative finance and this concept of drift of moving tick

0:17:08.280 --> 0:17:13.360
<v Speaker 1>by tick in a time series. Does bitcoin trade like apple?

0:17:13.840 --> 0:17:17.520
<v Speaker 1>Does bitcoin trade in a time series like a given

0:17:17.560 --> 0:17:20.879
<v Speaker 1>bond or a given foreign exchange pair? What does the

0:17:21.040 --> 0:17:26.640
<v Speaker 1>drift look like for bitcoin? Yeah, you know, look for

0:17:26.640 --> 0:17:28.960
<v Speaker 1>for something like bitcoin and crypto in general does so

0:17:28.960 --> 0:17:31.399
<v Speaker 1>there's obviously not as long a time series as there

0:17:31.440 --> 0:17:34.000
<v Speaker 1>are for other assets. But the way it trades when

0:17:34.000 --> 0:17:36.120
<v Speaker 1>you look at it historically and you look at realized

0:17:36.119 --> 0:17:39.880
<v Speaker 1>correlations is it's just another risk asset. And certainly given

0:17:39.880 --> 0:17:42.960
<v Speaker 1>the information that came out of FTX and everything that's

0:17:43.000 --> 0:17:45.720
<v Speaker 1>going on, you know, people want to know what direction

0:17:45.760 --> 0:17:48.360
<v Speaker 1>it's going. And I will say similar to all other

0:17:48.480 --> 0:17:51.760
<v Speaker 1>risk assets, Tom, you know, on the downside, it tends

0:17:51.800 --> 0:17:55.119
<v Speaker 1>to be more correlated. So we're seeing decently strong correlations,

0:17:55.400 --> 0:17:57.440
<v Speaker 1>you know, as the market had sold off and it

0:17:57.560 --> 0:18:01.280
<v Speaker 1>still remains strong, but it doesn't you know, on the upside,

0:18:01.280 --> 0:18:03.800
<v Speaker 1>it actually tends to diverge more than downside. All things

0:18:03.840 --> 0:18:06.199
<v Speaker 1>tend to go to one when things are you know,

0:18:06.280 --> 0:18:08.880
<v Speaker 1>selling off very hard. And we've been talking about how

0:18:08.920 --> 0:18:11.680
<v Speaker 1>incredible the swoon and bitcoin has been, but you point

0:18:11.680 --> 0:18:13.560
<v Speaker 1>to the other side of things that actually it's been

0:18:13.800 --> 0:18:16.879
<v Speaker 1>quite resilient, just the crypto space in general. Given the

0:18:17.040 --> 0:18:20.359
<v Speaker 1>entire collapse overnight of an entire firm, I wonder if

0:18:20.359 --> 0:18:22.880
<v Speaker 1>there's a broader message about the markets and just how

0:18:23.040 --> 0:18:26.040
<v Speaker 1>resilient and how invested a lot of institutions are, not

0:18:26.119 --> 0:18:29.200
<v Speaker 1>in the crypto space, but more broadly, and the reluctance

0:18:29.240 --> 0:18:33.320
<v Speaker 1>to really retrench in a meaningful way. Yeah, it's a

0:18:33.320 --> 0:18:36.680
<v Speaker 1>great question. And look a few months ago we we

0:18:36.720 --> 0:18:38.879
<v Speaker 1>spoke with both Sam Bank and Fried and Brett Harrison,

0:18:38.960 --> 0:18:41.600
<v Speaker 1>who was the president of FTS at the time. And

0:18:41.640 --> 0:18:45.440
<v Speaker 1>I think one thing that's underappreciated Lisa about what they

0:18:45.440 --> 0:18:48.000
<v Speaker 1>were doing was was not only on the crypto side,

0:18:48.000 --> 0:18:51.520
<v Speaker 1>but there were huge implications for just market structure, for

0:18:51.640 --> 0:18:55.760
<v Speaker 1>just normal markets, for futures, for derivatives. And the other

0:18:55.800 --> 0:18:58.800
<v Speaker 1>thing I would say is, you know, like given where

0:18:58.800 --> 0:19:02.120
<v Speaker 1>the CFTC proposals likely and now it's probably not going

0:19:02.160 --> 0:19:03.800
<v Speaker 1>to pass, or at least regulators are going to look

0:19:03.840 --> 0:19:07.800
<v Speaker 1>at things differently. But the resilience to me seemed to

0:19:07.840 --> 0:19:10.800
<v Speaker 1>speak of kind of the institutional adoption that did happen

0:19:11.160 --> 0:19:13.280
<v Speaker 1>because there was a lot of interest at the time,

0:19:13.320 --> 0:19:16.640
<v Speaker 1>and you know, we'll see how that changes. But institutions,

0:19:16.680 --> 0:19:18.400
<v Speaker 1>and this has been a theme that they talked about

0:19:18.400 --> 0:19:21.879
<v Speaker 1>a lot, was institutions continue adopt, continue to investigate, and

0:19:21.920 --> 0:19:24.359
<v Speaker 1>continue to have heads of digital and I don't know

0:19:24.400 --> 0:19:27.320
<v Speaker 1>that that would change even with where FDS is now.

0:19:27.800 --> 0:19:29.560
<v Speaker 1>I'm a wonderful a half from you, brilliant and so

0:19:29.680 --> 0:19:33.000
<v Speaker 1>whites Amy with Silverman that MC capitol, mar This is

0:19:33.000 --> 0:19:37.000
<v Speaker 1>the Bloomberg Surveillance Podcast. Thanks for listening. Join us live

0:19:37.119 --> 0:19:40.919
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0:19:41.119 --> 0:19:44.720
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0:19:44.800 --> 0:19:49.200
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<v Speaker 1>the terminal. I'm I'm keen in. This is Bloomer