WEBVTT - Episode 1: Tom Keene on Mathiness and His Favorite Guitar

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<v Speaker 1>Hello, and welcome to the first episode of Odd Lots.

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<v Speaker 1>I'm Joe Wisnthal, co host of What You Miss and

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<v Speaker 1>editor at Bloomberg markets Now. I'm Tracy Alloway, executive editor

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<v Speaker 1>of Bloomberg Markets. Here at Odd Lots, we want to

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<v Speaker 1>have a discussion every week about economics, finance, markets, market structure,

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<v Speaker 1>which Tracy loves, maybe some politics and culture thrown in

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<v Speaker 1>stuff that doesn't necessarily fit into the normal day to

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<v Speaker 1>day conversation. And we couldn't think of any guests better

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<v Speaker 1>to have than Tom Kin, my guinea pig. You're the

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<v Speaker 1>guinea pig. Tom King, as everyone should know, is the

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<v Speaker 1>host of Bloomberg Surveillance on TV and radio here Bloomberg.

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<v Speaker 1>He knows more about markets and economics and world events

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<v Speaker 1>than just about anyone else in the room. He's a

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<v Speaker 1>very eclectic background in music and mathematics. And I wanted

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<v Speaker 1>to have wanted to have Tom Keene on the show

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<v Speaker 1>because Tom is always interviewing people, but he'd never answering

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<v Speaker 1>questions and never behind try to avoid it like the plagues.

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<v Speaker 1>So we're gonna doing this for you, Joe. I'm doing

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<v Speaker 1>this for Tracey. Everybody knows that, but um, who are

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<v Speaker 1>you Tom? Why are you here? How did you get

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<v Speaker 1>to be Tom Keane? Who? Everybody? I get it a lot,

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<v Speaker 1>And what I would suggest is it's one part short

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<v Speaker 1>term stuff, one part long term stuff, and one part

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<v Speaker 1>blind luck. The long term thing is is being acutely

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<v Speaker 1>aware when I was a kid, and evermore every day

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<v Speaker 1>knowing how twisted the early years where I found something

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<v Speaker 1>like bet stan Freeburg record and you don't know Stan

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<v Speaker 1>Freeburg is he was a great comedian. He just died

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<v Speaker 1>this year. And then recently it was about the privilege

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<v Speaker 1>of running into Matt Winkler and basically Matt and I,

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<v Speaker 1>with the support of l Mayers who runs Bloomberg Media,

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<v Speaker 1>and Ted Fine who runs TV, they're the ones that

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<v Speaker 1>made all this happen. Matt win Clair, for our listeners

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<v Speaker 1>who don't know, is the guy who founded Bloomberg News. Essentially,

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<v Speaker 1>so you got lucky. You met Matt win Clair, you

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<v Speaker 1>just hired me because the bow tie. But to make

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<v Speaker 1>a long story short, you get lucky and I met

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<v Speaker 1>Matt and we basically invented what you see. That's that's

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<v Speaker 1>a safe statement. What were you doing before then? Because

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<v Speaker 1>when I think of you, I think you projected, or

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<v Speaker 1>of someone who's been doing radio for decades. But what

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<v Speaker 1>were you doing before you did radio and TV? Well,

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<v Speaker 1>before the media thing. I was in the investment business.

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<v Speaker 1>But there's a whole side car thing in music and

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<v Speaker 1>an entertainment um for example. And I gauge it off

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<v Speaker 1>my oldest child's age. I used to hold him in

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<v Speaker 1>my arms and do the stock report in Boston. And

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<v Speaker 1>this is the vanilla days, not cross asset, the dal

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<v Speaker 1>Jones industrial average up forty two points today, eight forty two,

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<v Speaker 1>blah blah blah. You know that. And so I did

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<v Speaker 1>a little bit of investment stuff back then, but a

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<v Speaker 1>lot of it was just the music business as well,

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<v Speaker 1>which is the show business aspect, which a lot of

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<v Speaker 1>people in business media try to ignore every day, and

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<v Speaker 1>they're wrong. I mean, the f T s pink. It's

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<v Speaker 1>pink for a reason. It's pink. It's like what you did.

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<v Speaker 1>I mean, you invented the modern headline in modern business journalism.

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<v Speaker 1>So it's just you know that Wisenthal wrote that headliner.

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<v Speaker 1>You just know that how has her investment experience informed

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<v Speaker 1>your career? A huge, huge um, it's a massive type

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<v Speaker 1>two and that you learn so much enjoying losing money. Um,

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<v Speaker 1>it's it's for those of you gaus see and it's

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<v Speaker 1>log normal. Uh, you learn way more on the downside

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<v Speaker 1>and the upside. Lots of fat tail risks. There's fat

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<v Speaker 1>tail risk, but that's not that that's over emphasized. It's

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<v Speaker 1>the joy of losing money within the fat tails, which

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<v Speaker 1>is I think that's you learn factors more losing money

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<v Speaker 1>than making money factors. But I can tell you that

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<v Speaker 1>the way I learned to lose money was enjoying losing

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<v Speaker 1>money in the options market. And then so when you're

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<v Speaker 1>doing the show, whether on radio or TV, how do

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<v Speaker 1>you apply that the fact that you learned so much

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<v Speaker 1>more when you lost money. When you think about it,

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<v Speaker 1>it's a humility show. It's a it's a humility thing

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<v Speaker 1>of knowing every day how dumb you are and trying

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<v Speaker 1>to always work at getting smarter, laughing at your mistakes.

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<v Speaker 1>There's a there's a lot there's less now after the

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<v Speaker 1>financial crisis, but there's lots of people strutting around with

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<v Speaker 1>a certain intellectual arrogance about economics, finance, investment. Right now

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<v Speaker 1>nobody has arrogance and international relations. Did you have to

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<v Speaker 1>learn how much you don't know, Like, where's the point

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<v Speaker 1>earlier in your career where you thought you knew it all?

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<v Speaker 1>And then you know certitude of yeah, you you you

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<v Speaker 1>learn from a wide set of mistakes and cycles, which

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<v Speaker 1>gives you a humility which forces you to get smarter.

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<v Speaker 1>For example, I went to a wedding this weekend and

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<v Speaker 1>half the wedding was from Uruguay. I know nothing about

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<v Speaker 1>Montevideo except one of my kids. Friends all went down

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<v Speaker 1>there because it couldn't get a job in America. And

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<v Speaker 1>I read seven articles this weekend in Uruguay just to

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<v Speaker 1>to begin to I have no clue about Uruguay. There's

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<v Speaker 1>that kind of madness, but compounded over I know nothing

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<v Speaker 1>about Uruguay. I know nothing about Montevideo. Is a great

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<v Speaker 1>humble bread because you slide in how easily you knew

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<v Speaker 1>the capital. Now I have to ask you talk about

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<v Speaker 1>certitude on Wall Street and in addition to having a

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<v Speaker 1>musical background, you also have a mathematical background. And it

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<v Speaker 1>seems like one of the areas in markets where people

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<v Speaker 1>start to get really certain and have that certain mathematical

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<v Speaker 1>swagger is when it comes to models, and you love

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<v Speaker 1>talking about models, how does your experience in mathematic nex

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<v Speaker 1>feed in. Yeah, that the background there was growing up

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<v Speaker 1>with it. I have the clearest memories of gooding up

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<v Speaker 1>on my tiptoes and looking over my father's desk as

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<v Speaker 1>he did very sophisticated triple integration of space satellites and

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<v Speaker 1>I would literally play on the floor with the French

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<v Speaker 1>curves is a million years ago and like like think

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<v Speaker 1>spot Nick and I g y and all that, and

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<v Speaker 1>all of that became a mathewiness which culminated in Max

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<v Speaker 1>peters fabulous program at the University of Colorado. Max Peters

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<v Speaker 1>was a highly decorated Italian infantryman up the spine of

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<v Speaker 1>Italy and World War Two, and he went out to

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<v Speaker 1>Colorado and put together, uh, the mother of all grinds

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<v Speaker 1>in engineering academics. And I was extremely fortunate to parachute

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<v Speaker 1>into that for a couple of years. So you take,

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<v Speaker 1>you know, what I get in math and what I

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<v Speaker 1>don't get, and trust me, is a lot I don't get.

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<v Speaker 1>And then you overlay that into some of the certitude

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<v Speaker 1>of quantitative finance and you get a massive humility. I

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<v Speaker 1>think the math overlay is a it's a massive type one.

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<v Speaker 1>You've got it, but what it really is, and I

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<v Speaker 1>see it every day, and it's getting worse. It's a

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<v Speaker 1>little better in a couple of last couple of years.

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<v Speaker 1>Is the math phobia within economics, finance, investments just stunning,

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<v Speaker 1>It's just breathtaking. You see rampant math phobia. Because other

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<v Speaker 1>people have argued that it's just the opposite, that economics

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<v Speaker 1>and finances become too mathy, to the point where people

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<v Speaker 1>can't explain in clear English what they're talking about. Yeah, well,

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<v Speaker 1>let me part that debate. You're absolutely right, Joe. The

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<v Speaker 1>basic idea is there was an era, particularly coming out

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<v Speaker 1>of World War Two, of of math, too much math,

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<v Speaker 1>math anxiety, etcetera, etcetera. And then at the undergraduate level,

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<v Speaker 1>not at the PhD, not at the doctor trek level

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<v Speaker 1>of the graduate level, but at the undergraduate level, a

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<v Speaker 1>vast majority of people don't have the dynamics in their

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<v Speaker 1>head to do even basic martiality and microeconomics or you know,

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<v Speaker 1>name the flavor of macro you want to do. The

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<v Speaker 1>British are very different. In the French they have much better,

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<v Speaker 1>as a rule of thumb, undergraduate mathematics than we do.

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<v Speaker 1>If I, if I talked to British students. Their knowledge

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<v Speaker 1>of first order difference equations off the chart honors undergraduate

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<v Speaker 1>programs in the US. Some of them they have no

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<v Speaker 1>clue what what that is. I'm pleased to say I've

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<v Speaker 1>I've forgotten almost all the mathematics I learned in college. However, however,

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<v Speaker 1>I want to know. So when you see something like

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<v Speaker 1>the events of August when the market sold off and

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<v Speaker 1>a lot of people were talking about mathematical formulas and

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<v Speaker 1>model based equations and risk parody at the center of

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<v Speaker 1>that sell off, what do you think I think some

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<v Speaker 1>of it was extremely valid this time around. Uh I,

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<v Speaker 1>I think that the modtle fatigue is much more in

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<v Speaker 1>the macro area. The work Olivia Blanchard did at the

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<v Speaker 1>i m F with Joe Stiglson others really important to

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<v Speaker 1>ask the non sophisticated and the very sophisticated differential equation

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<v Speaker 1>models that pro PhDs use, and I don't pretend to

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<v Speaker 1>be fluent in them. They're very suspect after what we

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<v Speaker 1>went through in August of oh seven. Stepping back, so

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<v Speaker 1>you have this interest in lifelong interest in mathematics in music,

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<v Speaker 1>which I was also want to get to. But then

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<v Speaker 1>how did that when did it click that markets and

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<v Speaker 1>investments where they were in the earliest memories, earliest it

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<v Speaker 1>was permeating in my house. My my grandfather knew a

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<v Speaker 1>w CO and the point and figure guy. He did

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<v Speaker 1>point and figure charts. My mother did point and figure charts,

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<v Speaker 1>totally totally permeating investment theory and investment analysis, you know,

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<v Speaker 1>just original Graham, Don and Coddle up on. So in

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<v Speaker 1>addition to everything else you were always interested in, you

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<v Speaker 1>always knew that this was something you wanted to know.

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<v Speaker 1>You know, I didn't know, it just was there. It

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<v Speaker 1>was just there kind of thing. I'm also, I don't

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<v Speaker 1>think a lot of people know about your musical background.

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<v Speaker 1>But why do you give us the sixteed and here's

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<v Speaker 1>Tom King's music? The ninety second version is real simple.

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<v Speaker 1>At eight years old, I walked into a place called Stutsman's,

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<v Speaker 1>which is legendary and the acoustic music business. With my father.

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<v Speaker 1>There were six Grutch White Falcons lined up and where Rochester,

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<v Speaker 1>New York Kodak and my father bought me a forty

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<v Speaker 1>two dollar you know, acoustic guitar, and then I just

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<v Speaker 1>began grinding away and there were three or four iterations

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<v Speaker 1>of it. But to make a long story short, I

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<v Speaker 1>ended up doing the New England singer songwriter thing, juggling

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<v Speaker 1>a bunch of other stuff. There's a place in Nashville

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<v Speaker 1>called the Blueberg Cafe, which is magical Bloomberg. You know.

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<v Speaker 1>It was just the New England folks and it was

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<v Speaker 1>sort of you know in terms of artists around it. Uh,

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<v Speaker 1>it was post Tracy Chapman, um Susan Vega was really

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<v Speaker 1>happening with Luca and Solitude standing and then a whole

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<v Speaker 1>host of people came on, really jumped, started by a

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<v Speaker 1>guy named David Wilcox who did an album called Either

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<v Speaker 1>Hurricane for A and M Records, which just there was

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<v Speaker 1>like this mini folk boom and what was so cool?

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<v Speaker 1>We knew when we this is before the internet. That's

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<v Speaker 1>a key statement. Even we had no idea what was

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<v Speaker 1>coming in digital, but we knew how lucky we were

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<v Speaker 1>to do it. When we were doing it, we knew

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<v Speaker 1>it couldn't last. What was the greatest guitar you've ever owned?

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<v Speaker 1>The one I got now with the greatest guitar my

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<v Speaker 1>my concert Gibson J one hundred, which was picked out

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<v Speaker 1>by Eric Schoenberg up in Boston was stolen and I

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<v Speaker 1>got it back four years ago. I told Dave Drummond

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<v Speaker 1>and Google. I got it off Google Images. There was

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<v Speaker 1>my guitar and Google images. But that and I've got

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<v Speaker 1>some others now. But I think that's you know, I

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<v Speaker 1>guess the best ones that when my father had, but

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<v Speaker 1>that's been lost. So with your very very idiosyncratic background

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<v Speaker 1>in mathematics, it's almost like Joe Wisenthal an investment. When

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<v Speaker 1>you do your show today at Bloomberg and you look

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<v Speaker 1>around the world, what do you see as the most

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<v Speaker 1>important story going on right now? Um, I think the

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<v Speaker 1>number one stories. One of my kids said to me, Daddy,

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<v Speaker 1>when does this get got to be fun? And I

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<v Speaker 1>think there's a massive understanding by people of a certain

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<v Speaker 1>vintage that the kids don't have. They have lots of

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<v Speaker 1>wonderful digital stuff and medical stuff, etcetera, etcetera, but the

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<v Speaker 1>optimism has been shattered. And the answer Jeff emmel I

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<v Speaker 1>was with two years ago, I'm guessing and he said, look,

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<v Speaker 1>all we need is three point two percent GDP and

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<v Speaker 1>that solves a lot of problems. That's a very smart

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<v Speaker 1>comment by the applied mathematician from Dartmouth. We don't have that.

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<v Speaker 1>The the younger people, people under about thirty two, have

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<v Speaker 1>never known normal. So when you look at the world,

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<v Speaker 1>you don't necessarily see problems of inequality, you see generational problems. No,

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<v Speaker 1>I think they're both there, but I think in two

0:13:28.400 --> 0:13:33.840
<v Speaker 1>thousand and fifteen that the generational issues are less spoken,

0:13:34.280 --> 0:13:37.440
<v Speaker 1>which to an extent speaks of the anger into politics today.

0:13:37.720 --> 0:13:39.480
<v Speaker 1>When do you think it wasn't normal? Or when was

0:13:39.600 --> 0:13:41.680
<v Speaker 1>it was? Well, you know, you stand on the floor

0:13:41.679 --> 0:13:44.280
<v Speaker 1>of the Republican convention. Ex conventions are going you go,

0:13:44.520 --> 0:13:48.080
<v Speaker 1>well this is surreal or the Democratic doesn't matter which

0:13:48.160 --> 0:13:52.960
<v Speaker 1>part party. But the answer is we are programmed for

0:13:53.120 --> 0:13:57.679
<v Speaker 1>certain nominally real GDP that ain't happened. There's a quarter here,

0:13:57.679 --> 0:14:00.840
<v Speaker 1>at quarter there, Macroeconomic Advisor is right now, hiss, third

0:14:00.920 --> 0:14:04.480
<v Speaker 1>quarter at one. The next quarter is a little bit better.

0:14:04.520 --> 0:14:08.920
<v Speaker 1>But we we have not had the run rate of

0:14:09.040 --> 0:14:14.640
<v Speaker 1>GDP that provides base psychological comfort to a lot of people,

0:14:15.600 --> 0:14:19.960
<v Speaker 1>whether it's over educated torps like my kids, or you know,

0:14:20.120 --> 0:14:23.280
<v Speaker 1>people really struggling millions of Americans. Do you think I mean?

0:14:23.320 --> 0:14:27.600
<v Speaker 1>I remember thinking in and when we had the Raging

0:14:27.640 --> 0:14:29.720
<v Speaker 1>Dead ceiling debate, and I think that was the first

0:14:29.760 --> 0:14:32.760
<v Speaker 1>time that we saw this huge I would say, the

0:14:32.880 --> 0:14:36.680
<v Speaker 1>crisis and the economy seeming to really spill over into politics,

0:14:36.720 --> 0:14:39.640
<v Speaker 1>and we had this start division the Tea Party and leadership.

0:14:39.960 --> 0:14:42.680
<v Speaker 1>But it hasn't faded as much as I would have guessed,

0:14:42.680 --> 0:14:47.920
<v Speaker 1>given how far unemployment has dropped. I mean, the economy

0:14:48.000 --> 0:14:49.840
<v Speaker 1>is much better than it was in eleven, but we

0:14:49.880 --> 0:14:53.600
<v Speaker 1>still have look at Donald Trump and leading in the polls,

0:14:53.640 --> 0:14:56.800
<v Speaker 1>and we have rise of more radical politicians everywhere. Do

0:14:56.840 --> 0:14:58.960
<v Speaker 1>you think it's something beyond economics. It has to do

0:14:58.960 --> 0:15:02.320
<v Speaker 1>with the media environment, the Internet. It has to do

0:15:02.400 --> 0:15:04.280
<v Speaker 1>the media, and it has to do with speed of

0:15:04.320 --> 0:15:07.080
<v Speaker 1>trans Twitter and all. I mean the Cypress crisis alone

0:15:07.400 --> 0:15:10.840
<v Speaker 1>with Twitter was surreal that Saturday morning when Cyperus drew up.

0:15:11.120 --> 0:15:15.520
<v Speaker 1>How the Twitter dialogue changed the discussion. But what I

0:15:15.520 --> 0:15:19.360
<v Speaker 1>would what is under emphasized from a Newtonian mechanics standpoint

0:15:19.480 --> 0:15:23.360
<v Speaker 1>is inertial force and the word chronic. And the answer

0:15:23.560 --> 0:15:26.960
<v Speaker 1>is you totally right about ten and eleven. And what's

0:15:27.000 --> 0:15:29.720
<v Speaker 1>different now is it may not be forced masure like

0:15:29.760 --> 0:15:33.880
<v Speaker 1>it was then, but there's just this chronic weight of

0:15:34.000 --> 0:15:38.200
<v Speaker 1>gridlock in Washington. This chronic sense of g d P

0:15:38.440 --> 0:15:42.600
<v Speaker 1>under performing even while unemployment supposedly gets better. And that

0:15:42.640 --> 0:15:46.680
<v Speaker 1>goes back to productivity. You know, we could board everybody

0:15:46.760 --> 0:15:53.080
<v Speaker 1>with three ratio productivity analysis just act productivity in the

0:15:53.120 --> 0:15:59.040
<v Speaker 1>media is uh appallingly reported. There's capital, there's labor, and

0:15:59.080 --> 0:16:01.920
<v Speaker 1>there's a separate ray show wrapped around something called total

0:16:02.040 --> 0:16:07.440
<v Speaker 1>factor productivity or TFP. And the pros know all that

0:16:08.040 --> 0:16:09.800
<v Speaker 1>and they sort of just, you know, when we talk

0:16:09.880 --> 0:16:13.960
<v Speaker 1>about productivity, gloss over it. But the answers laboring happening.

0:16:14.000 --> 0:16:17.680
<v Speaker 1>And certainly for a part of America, this Angus Deaton

0:16:17.760 --> 0:16:20.680
<v Speaker 1>winning the Nobel Prize a big deal, big big deal.

0:16:20.880 --> 0:16:24.720
<v Speaker 1>This is the death of aggregate aggregation, of summoning everything

0:16:24.760 --> 0:16:28.160
<v Speaker 1>together and that that's a really big deal that I

0:16:28.480 --> 0:16:31.600
<v Speaker 1>talked to Shower today and I chance to talk about it. Well,

0:16:31.640 --> 0:16:34.280
<v Speaker 1>that brings us to again to your show. When you

0:16:34.360 --> 0:16:37.400
<v Speaker 1>go out and talk to people, what makes some good

0:16:37.440 --> 0:16:40.680
<v Speaker 1>interviews and who are the best interviewees that you think

0:16:40.680 --> 0:16:43.200
<v Speaker 1>you've had. It's a it's a chemistry. It's a mixture,

0:16:43.760 --> 0:16:47.880
<v Speaker 1>uh And there's always exceptions. There's hyper academic people that fail,

0:16:48.000 --> 0:16:51.240
<v Speaker 1>and and I do think it's a chemistry We keep

0:16:51.360 --> 0:16:53.480
<v Speaker 1>very careful track of who we like and who we

0:16:53.520 --> 0:16:57.360
<v Speaker 1>don't like. And I would say the third rail is

0:16:57.400 --> 0:17:00.840
<v Speaker 1>we don't want people that are scripted or consulted. That

0:17:00.920 --> 0:17:03.880
<v Speaker 1>was the rage to three five years ago. There's less

0:17:03.920 --> 0:17:06.760
<v Speaker 1>of that now. We have less and less people on

0:17:06.960 --> 0:17:09.399
<v Speaker 1>talking points, which is where a consultant comes in and

0:17:09.400 --> 0:17:12.199
<v Speaker 1>tells them four things to say. That's going away. But

0:17:12.400 --> 0:17:14.920
<v Speaker 1>mostly it's you know, it's a media phrase. Pop. They've

0:17:14.920 --> 0:17:17.920
<v Speaker 1>gotta have Pop, particularly in radio is critical. So we

0:17:18.040 --> 0:17:21.720
<v Speaker 1>talked about these sort of big general generational issues that

0:17:21.760 --> 0:17:24.720
<v Speaker 1>you see is the main thing? What about this moment

0:17:24.800 --> 0:17:27.959
<v Speaker 1>specifically when you look at financial markets? What are the

0:17:27.960 --> 0:17:30.879
<v Speaker 1>big things that you're watching. We're going to get into

0:17:30.960 --> 0:17:34.760
<v Speaker 1>prediction season soon for what do you? What do you?

0:17:34.760 --> 0:17:36.679
<v Speaker 1>What do you have your on? What would you What

0:17:36.760 --> 0:17:38.520
<v Speaker 1>are the charts that you look at first thing in

0:17:38.560 --> 0:17:41.040
<v Speaker 1>the morning. My chart of the year's inflation adjusted come

0:17:41.040 --> 0:17:43.399
<v Speaker 1>out of these back sixty seventy years. I've shown it

0:17:43.440 --> 0:17:45.920
<v Speaker 1>in TV probably ten times. You can steal. It's a

0:17:45.960 --> 0:17:50.760
<v Speaker 1>great chart, great great chart, and it looks like a

0:17:50.960 --> 0:17:56.719
<v Speaker 1>persistent decline in commodity prices over many years. And then

0:17:56.760 --> 0:18:00.280
<v Speaker 1>there's a China aberration, and we are, off the top

0:18:00.320 --> 0:18:03.320
<v Speaker 1>of my head, two thirds to three quarters of our

0:18:03.359 --> 0:18:08.399
<v Speaker 1>way back to normal, which is commodity long term commodity deflation.

0:18:08.680 --> 0:18:11.120
<v Speaker 1>So you don't think the long term, we're not. It's

0:18:11.119 --> 0:18:13.439
<v Speaker 1>not over yet. If we're going to return to normal,

0:18:13.640 --> 0:18:15.720
<v Speaker 1>I would suggest not that it's not over. I'm not

0:18:15.720 --> 0:18:17.960
<v Speaker 1>going to make a prediction. I would say the people

0:18:18.040 --> 0:18:21.320
<v Speaker 1>predicting it is over ore on tenuous ground. That's Thomas

0:18:21.400 --> 0:18:24.600
<v Speaker 1>media experience coming through that, refusing to make a prediction.

0:18:24.800 --> 0:18:27.440
<v Speaker 1>Do you think one thing I feel is like everyone's

0:18:27.480 --> 0:18:31.360
<v Speaker 1>talking about deflation and central banks around the world failing

0:18:31.400 --> 0:18:34.440
<v Speaker 1>to hit their policies and how are they going to reflate?

0:18:34.480 --> 0:18:37.640
<v Speaker 1>They can't do it, And then you see these conversations

0:18:37.800 --> 0:18:40.679
<v Speaker 1>the Phillips curve, this idea that the employment and the

0:18:40.720 --> 0:18:44.480
<v Speaker 1>inflation ratear inversely related, and how that's dead and broken.

0:18:44.880 --> 0:18:47.880
<v Speaker 1>Do you think we could be getting to an extreme

0:18:47.960 --> 0:18:51.240
<v Speaker 1>in the other direction where everyone is just thrown in

0:18:51.320 --> 0:18:54.159
<v Speaker 1>the towel on any sort of inflation coming back and

0:18:54.240 --> 0:18:57.920
<v Speaker 1>anything like that, and no to get wonky on you

0:18:58.800 --> 0:19:02.800
<v Speaker 1>within a classic I SLM matrix Johnny Hicks thirty nine

0:19:02.800 --> 0:19:06.360
<v Speaker 1>and Krugman's written about this beautifully. What I would suggest

0:19:06.480 --> 0:19:10.800
<v Speaker 1>is there's a total underestimation of real economy effects. Everybody's

0:19:10.840 --> 0:19:12.919
<v Speaker 1>over in the bank. What's yelling gonna do, what's karneiy

0:19:12.960 --> 0:19:15.440
<v Speaker 1>gonna do? Which is fine, I mean, that's what keeps

0:19:15.520 --> 0:19:18.919
<v Speaker 1>us some point, all rio's but the real economy effects

0:19:18.960 --> 0:19:22.040
<v Speaker 1>have been grossly underrated from day one of the crisis

0:19:22.119 --> 0:19:25.240
<v Speaker 1>August of oh seven. And the other thing I would

0:19:25.359 --> 0:19:29.800
<v Speaker 1>suggest is the interest rate transmission between the real economy

0:19:29.920 --> 0:19:32.600
<v Speaker 1>and the bank side of things. The l M curve

0:19:32.720 --> 0:19:36.920
<v Speaker 1>is totally broken at the zero bound. And these there's

0:19:36.960 --> 0:19:40.560
<v Speaker 1>things we don't understand that are going on in the

0:19:40.600 --> 0:19:44.199
<v Speaker 1>interest rate sphere right now that are there. There's a

0:19:44.280 --> 0:19:48.040
<v Speaker 1>mystery here. I can't believe we've gotten this far in

0:19:48.080 --> 0:19:52.960
<v Speaker 1>the segment without talking about your bow ties and the

0:19:53.040 --> 0:19:56.600
<v Speaker 1>fact that the bow t high was almost entirely responsible

0:19:56.680 --> 0:19:59.760
<v Speaker 1>for bringing you to Bloomberg. Since Mr Matt Winkler also

0:19:59.800 --> 0:20:05.080
<v Speaker 1>in choice wearing those. I found a picture of my grandfather,

0:20:05.200 --> 0:20:09.280
<v Speaker 1>my mother's father, five years ago, holding me and he

0:20:09.320 --> 0:20:11.439
<v Speaker 1>had a bow tie on. I have no recollection of

0:20:11.480 --> 0:20:15.040
<v Speaker 1>my grandfather having a bow tech um. It started when

0:20:15.040 --> 0:20:17.359
<v Speaker 1>I was sort of sort of kind of like premed

0:20:17.800 --> 0:20:20.600
<v Speaker 1>and I was in emergency rooms and they wouldn't let

0:20:20.600 --> 0:20:22.879
<v Speaker 1>you wear a normal tie because they're afraid the patient

0:20:22.920 --> 0:20:25.439
<v Speaker 1>will grab you with a regular tie. So I was

0:20:25.480 --> 0:20:28.359
<v Speaker 1>forced to wear a bow tech uh, doing what was

0:20:28.400 --> 0:20:30.680
<v Speaker 1>called extern This is a million years ago. This is

0:20:30.760 --> 0:20:34.960
<v Speaker 1>before anesthesia and uh uh you know it sort of

0:20:35.000 --> 0:20:38.080
<v Speaker 1>started with that. I'm assuming back then they weren't amazed

0:20:38.119 --> 0:20:40.760
<v Speaker 1>ties though as they they were not. No, they weren't.

0:20:40.760 --> 0:20:43.919
<v Speaker 1>We did the clip on thing minimally. I must admit

0:20:44.040 --> 0:20:46.040
<v Speaker 1>that that was like, no, I don't want to do that.

0:20:46.400 --> 0:20:49.800
<v Speaker 1>Do you have a favorite tie? Doesn't mean something? No,

0:20:49.840 --> 0:20:52.600
<v Speaker 1>not really. This one's actually very old. This is like

0:20:52.640 --> 0:20:55.160
<v Speaker 1>one of the original it's an orange tie for those.

0:20:57.119 --> 0:20:59.000
<v Speaker 1>Thank you very much for joining us. That was a

0:20:59.080 --> 0:21:01.719
<v Speaker 1>phenomenal Discuy Shin. I learned a lot about you and

0:21:02.359 --> 0:21:04.240
<v Speaker 1>podcasts is really cool. You know we did in years

0:21:04.240 --> 0:21:10.840
<v Speaker 1>ago and I totally agree with a new um enthusiasm podcast.

0:21:11.240 --> 0:21:13.399
<v Speaker 1>Thank you for being our guinea pig. Tom, Thank you,

0:21:15.359 --> 0:21:17.479
<v Speaker 1>thank you for joining us on the first episode of

0:21:17.480 --> 0:21:20.280
<v Speaker 1>Odd Lots. We'll be doing this every week and you

0:21:20.320 --> 0:21:23.600
<v Speaker 1>can find it on Bloomberg dot com, iTunes, SoundCloud and

0:21:23.640 --> 0:21:26.840
<v Speaker 1>just about anywhere else. You can follow us on Twitter

0:21:27.200 --> 0:21:30.800
<v Speaker 1>at at the Stalwart, for Me, at Tracy Ellaway. For

0:21:30.960 --> 0:21:34.440
<v Speaker 1>Tracy will obviously be tweeting out the links. And thanks

0:21:34.480 --> 0:21:36.840
<v Speaker 1>again to Tom Keene for joining us and being our

0:21:36.880 --> 0:21:39.480
<v Speaker 1>guinea pig on this first episode, and thank you for

0:21:39.520 --> 0:21:39.879
<v Speaker 1>listening