Speaker 1: Welcome to the Bloomberg Markets Podcast. I'm Paul Sweeney, along
Speaker 1: with my co host of Bonnie Quinn. Every business day
Speaker 1: we bring you interviews from ceo, market pros, and Bloomberg experts,
Speaker 1: along with essential market moving news. Find the Bloomberg Markets
Speaker 1: Podcast on Apple Podcasts or wherever you listen to podcasts,
Speaker 1: and on Bloomberg dot com. Well, yesterday was a busy
Speaker 1: day in Washington, to say the least, but it was
Speaker 1: also a busy day for social media platforms. Twitter suspended
Speaker 1: President Trump's Twitter feed for twelve hours, required deletion of
Speaker 1: the offending tweets, and then threatened a band. Facebook suspended
Speaker 1: the President's ability to post for twenty four hours, but
Speaker 1: said nothing about a permanent band. To get the latest
Speaker 1: on how the social media platforms are reacting to yesterday's news,
Speaker 1: we welcome to Jim Anderson, CEO of Social Flow. Jim,
Speaker 1: thanks so much for joining us here. So, you know,
Speaker 1: it's some pretty dramatic moves there by Facebook and Twitter.
Speaker 1: What do you make of it? Yeah, Paul, it is
Speaker 1: dramatic moves. I mean, in many ways we're unprecedented territory.
Speaker 1: I will say that a suspension is not yet a band.
Speaker 1: But there there's an air of inevitability to this that
Speaker 1: I haven't seen before, where you know, you've got a
Speaker 1: situation where the president was inciting violence. You know that
Speaker 1: that will be much discussed whether that was his intent
Speaker 1: or not, but certainly that was the outcome. And the
Speaker 1: social media platforms have always taken sort of refuge saying, hey,
Speaker 1: we we are not in a position to suppress the
Speaker 1: voice of a duly elected president. But now they you
Speaker 1: saw Twitter sort of move from one policy to another,
Speaker 1: say well, the threat of violence now has caused us
Speaker 1: to use this in a different light, and that's what
Speaker 1: led to the suspension. And so the real question in
Speaker 1: my mind is, you know, President Trump needs to sort
Speaker 1: of back down, and because Twitter said if you continue
Speaker 1: to do this, we may ban your account permanently. And
Speaker 1: when have we ever known President Sumps to back down
Speaker 1: from something? Yeah, I mean, is this something that is
Speaker 1: happening because he is the outgoing president at this point,
Speaker 1: so there is less at stake. Yeah, Bonny, without a doubt.
Speaker 1: I mean, he's got what thirteen twelve states left in office.
Speaker 1: And it's interesting, you know, outgoing presidents, or we'll call
Speaker 1: them former presidents traditionally in the United States have had
Speaker 1: sort of irrelevance. I mean, I don't mean that pejoratively.
Speaker 1: You know, that's sort of the nature. You retire, you
Speaker 1: become an elder statesman, You sort of after a while,
Speaker 1: write a book, you open a library, and that's about
Speaker 1: what you hear from former presidents. And I don't think
Speaker 1: anybody expects that from President Trump. You know, he's even
Speaker 1: you know, already teased the idea that he may run again.
Speaker 1: So he may be a former president and a future candidate,
Speaker 1: but once he is no longer president, and we're clearly
Speaker 1: coming up on the point where he is no longer president,
Speaker 1: you know, he's very clearly going to be treated with
Speaker 1: a different set of rules. And I think Twitter more
Speaker 1: specifically has been quite quite a bit more aggressive than
Speaker 1: Facebook and saying, look, we may just stand your entire account.
Speaker 1: So you know, I have a lot of folks on Twitter,
Speaker 1: on social media have been calling for Facebook and Twitter
Speaker 1: too permanently, been President Trump. And even Kara Swisher, one
Speaker 1: of the more of the New York Times, one of
Speaker 1: the more influential tech observers over the last couple of decades,
Speaker 1: has done the same here. What are the expectations post
Speaker 1: January twenty one or more of these social platforms might
Speaker 1: just in fact ben President Trump. Yeah, I think so.
Speaker 1: The first thing we need to do is we need
Speaker 1: to separate Twitter from Facebook. They are obviously two different companies.
Speaker 1: We tend to talk about them to theay what Twitter doing,
Speaker 1: What's Facebook doing? But but remember, you know, Facebook is
Speaker 1: you know, sort of twenty times larger or so than
Speaker 1: Twitter in terms of market cap. I just checked this morning. Um,
Speaker 1: and Facebook has got a lot more to fear from
Speaker 1: regulation and antitrust and those kinds of things than than
Speaker 1: Twitter does, just sort of simply from from the size
Speaker 1: and scale of their operation. You know, they're both private companies,
Speaker 1: and there's a case to be made that they can,
Speaker 1: you know, sort of choose to operate the platforms in
Speaker 1: whatever manner they see fit because it's private, you know,
Speaker 1: it's a private platform and private speech. Um, but I
Speaker 1: think Twitter is definitely being more aggressive. You know, President
Speaker 1: Trump has eighty nine million followers on Twitter. But to
Speaker 1: the degree he's ever had a social media superpower, it's
Speaker 1: not his ability to tweet. It's a need to get
Speaker 1: the media to cover what he tweets, and so if
Speaker 1: you take that megaphone away from him, which Twitter may
Speaker 1: very well do, um, he's going to have a really
Speaker 1: deep hill decline. Certainly, he's got many supporters. Seventy plus
Speaker 1: million people voted for him. It's not that he will
Speaker 1: become you know, irrelevant, but but you know, losing that
Speaker 1: Twitter megaphone would be a very significant load to him.
Speaker 1: Facebook similarly, he's got a large audience there, but he's
Speaker 1: not nearly as prolific on Facebook, and that doesn't seem
Speaker 1: to be able to drive the media narrative nearly as
Speaker 1: much as what he's tweeted has been able to do.
Speaker 1: What happens under a Biden presidency is Twitter as used?
Speaker 1: Do people still gather there too, you know, incite each
Speaker 1: other if you like. Well, the Twitter certainly will be used,
Speaker 1: and people do and probably still will incite on on
Speaker 1: on Twitter and do other things what you won't see
Speaker 1: as President Biden, of course tweeting like President front then, right,
Speaker 1: I mean it's just a completely different, uh personality. President
Speaker 1: He will be a user of social media, I'm quite certain,
Speaker 1: or at least his staff will, but but in a
Speaker 1: much less provocative way. Right, It's different kind of politicians.
Speaker 1: So I don't suspect that we will be having many
Speaker 1: conversations about what President Biden tweeted this morning like we
Speaker 1: have with President Trump. And so it's it's just it's
Speaker 1: sort of going to be a much more normal or
Speaker 1: traditional lot. I guess i'll call it view of the
Speaker 1: presidency and how they conduct, you know, briefings of the public.
Speaker 1: All right, Jim, thank you so much. Jim Anderson's always
Speaker 1: a pleasure to speak with you. Jim Anderson's CEO of
Speaker 1: a Social Flow and of course Bloomberg Media and other
Speaker 1: parts of Bloomberg works with Social Flow. That's just a disclaimer, Yeah, Paul,
Speaker 1: I mean I've been pretty you know, ignorant of Twitter
Speaker 1: over the last few days. I haven't really wanted to
Speaker 1: see the back and forth. I mean some of them
Speaker 1: are pretty graphic and and pretty nasty. Yeah, it really was.
Speaker 1: And there is a call for regulation, but you bounce
Speaker 1: that against the censorship issues, uh, And that's kind d
Speaker 1: of the challenge out there in the marketplace and for
Speaker 1: the regulators as well. Well. This week, among other things,
Speaker 1: we had Impossible Foods deciding to cut the prices on
Speaker 1: their foe meat or fake meat products by fift percent.
Speaker 1: Of course, so Impossible makes burger is essentially from a
Speaker 1: magic ingredient that is essentially modified yeast. Time to bring
Speaker 1: in Dennis Woodside, president of Impossible Foods, and Dennis, thank
Speaker 1: you so much for joining. It's been a busy day.
Speaker 1: I know that we just had news breaking that you
Speaker 1: now have an interim CFO as your previous gentleman went
Speaker 1: to app Harvest to head up a harvests. So I'm
Speaker 1: sure it's been a very busy few days for you.
Speaker 1: But talk to us about why you decided to reduce
Speaker 1: the price of your products by fiftcent at a time
Speaker 1: when it must be difficult to do that. Yeah, thanks
Speaker 1: for having me. So the price reduction is part of
Speaker 1: an ongoing strategy to get down ultimately to the price
Speaker 1: of of ground beef. So you have you have at
Speaker 1: the very high end products like wandboo beef and like
Speaker 1: nine bucks a pound. We're currently priced with this reduction,
Speaker 1: closer to what you would pay for grass fed. But
Speaker 1: ultimately we need to compete with the mass of the market,
Speaker 1: which is which is buying what's called ground beef, and
Speaker 1: that's even lower than where we are now. Uh, so
Speaker 1: you you should expect continuing price reductions from us over
Speaker 1: time as we get scale, and we can pass the
Speaker 1: benefits of that that scale onto our restaurant partners and
Speaker 1: onto consumers ultimately. Uh, Dennis, what's the elasticity there on
Speaker 1: the price cuts for you? It seems in this market
Speaker 1: that you've had pretty strong unit sales, perhaps strong enough
Speaker 1: that you don't need to cut prices. Give us a
Speaker 1: sense of how that dynamiccause working for you, guys. Yeah, yeah,
Speaker 1: you know the market isn't The elasticity is incredibly high.
Speaker 1: The vast, vast majority of of consumers purchase beef in
Speaker 1: the three to six dollar range, and we're we're just
Speaker 1: outside that now. Uh. We expect, as I said, to
Speaker 1: get down there over time as we continue to scale
Speaker 1: our production. Uh. If you think about the economies of scale,
Speaker 1: you know, you you build a plan or you stand
Speaker 1: up a supply chain. The more you put through that plant,
Speaker 1: the more lines you can run, the more ships you
Speaker 1: can run. Uh. You know, your fixed costs are just
Speaker 1: amortized over over a larger revenue base. And and so
Speaker 1: we've been able to as our as our productionist scale,
Speaker 1: as our volume scale, We've been able to get those
Speaker 1: economies over the last year. But we don't see that stopping.
Speaker 1: We just see our footwork continue to continue to expand
Speaker 1: and continue to pass that benefit onto onto our partners
Speaker 1: and consumers. Now, you said just at the end of
Speaker 1: last year that you're going to be doubling your R
Speaker 1: and D team over the next twelve months. Important to
Speaker 1: get into the Chinese market as well, to grow your
Speaker 1: base and also keep competitors at bay, like beyond meat
Speaker 1: and you know meat makers and other countries in the world.
Speaker 1: You've also had seven fundraising rounds. Where are you in
Speaker 1: terms of capital needs? We're we're actually quite quite good
Speaker 1: right now. We raised a couple hundred million uh in
Speaker 1: in May time frame, and then several million prior to
Speaker 1: that um. But look, you know, the market that we're
Speaker 1: going after is enormous. Our our mission is to replace
Speaker 1: all animal based protein products and that is a literally
Speaker 1: a one trillion pound market roughly four to over four
Speaker 1: trillion dollars globally, and and we're competing now in a
Speaker 1: relatively small part of it, which is primarily ground beef.
Speaker 1: We have a sausage product as well, but primarily ground beef.
Speaker 1: But we see opportunity in many other meat products. Um
Speaker 1: and you know it's not it's not a surprise that uh,
Speaker 1: ground steak, chicken, fish, all these are interesting to us
Speaker 1: over time. For us to be competitive in those those markets,
Speaker 1: we need to invest in R and D and create
Speaker 1: the same kind of wow product that we did when
Speaker 1: we launched The Impossible Burgher. Dennis talked to us about
Speaker 1: kind of your distribution directed tumor versus restaurants. Where are
Speaker 1: you now? You know, where do you want to be?
Speaker 1: Where's the real growth? Talk us about, you know, kind
Speaker 1: of your revenue story. Yeah, we're in over thirty thousand
Speaker 1: restaurants in the US. We're in over seventeen thousand retail
Speaker 1: doors and and that's up from like two hundred a
Speaker 1: year ago. So we made a big move into retail
Speaker 1: over the last year. But at the same time, we
Speaker 1: have a limited products that we have to retail products
Speaker 1: now most if you if you look at beef products,
Speaker 1: you know, anybody's selling beefs to to a to a
Speaker 1: retailer probably has ten to fifteen different skews. And we're
Speaker 1: in the process of building a much broader portfolio to
Speaker 1: go to to expand that retail presence. So it's still
Speaker 1: even though we're we've we've got good presences, still pretty
Speaker 1: early days. There's well over three thousand restaurants in the US,
Speaker 1: and that's just the U S which is less than
Speaker 1: fiftent of all beef consumption. So it's very early days
Speaker 1: for the industry. You know, most of our consumers are
Speaker 1: are the vast majority, like of them are uh meat eaters.
Speaker 1: Uh and and they're shifting a small portion today of
Speaker 1: their meat um meat meat eating into plant based Over time,
Speaker 1: that share is just going to grow and grow as
Speaker 1: they see the benefits, the health benefits as well as
Speaker 1: the environmental benefits of moving to a plant more of
Speaker 1: a plant based meat UH diet Dennis and announcing this
Speaker 1: price reduction, Yours Books person said that now the lowest
Speaker 1: price for your burger product is six dollars and eight
Speaker 1: cents per pound. How much of that is pure profit
Speaker 1: and much of what people are buying is basically, you know,
Speaker 1: helped by private equity funding. Uh So the economic unit
Speaker 1: economics of the business are quite good actually, and it's
Speaker 1: not the kind of the case where this is you know,
Speaker 1: we're selling at a loss. Um and like I said,
Speaker 1: at the the the growth of the business has has
Speaker 1: enabled us to get the scale uh in order to
Speaker 1: in order to sell product at a at a reasonable margin,
Speaker 1: but also reduced our prices. And you think about the
Speaker 1: you know, the inputs that we we have to the
Speaker 1: product are our plants, and those plants are much lower
Speaker 1: cost than than the animal because you don't have the
Speaker 1: all of the um labor that goes into rating cows,
Speaker 1: you don't have the transportation and so forth. So the
Speaker 1: unit economics are actually quite good, especially as you start
Speaker 1: to get the scale. Hey, Dennis, thanks so much for
Speaker 1: joining us. Really appreciate the update. Dennis Woodside, president of
Speaker 1: Impossible Foods, based in Menlo Park, California, continuing to grow
Speaker 1: that plant based food business. Well, there are many questions
Speaker 1: that will need to be answered about what occurred in Washington,
Speaker 1: d C. Yesterday. Chief among them is security or lack
Speaker 1: thereof that allowed the whole event to take place to
Speaker 1: the scale at which it did, and we can maybe
Speaker 1: begin to start answering some of the asking some of
Speaker 1: those questions right now at Jordan Strauss, Managing director of
Speaker 1: Business Intelligence and Operations for Cruell, which is a vision
Speaker 1: of Duff and Phelps based in Philadelphia, Jordan. Thanks so
Speaker 1: much for joining us here. The images we saw of
Speaker 1: the inability of the Capitol Police and the and the
Speaker 1: d C Police UH to secure the Capital grounds, and
Speaker 1: in fact it seemed at times some of the videos
Speaker 1: suggest that they were letting them in and not even
Speaker 1: trying to stop the folks that were coming into the Capitol.
Speaker 1: What do you make of all that? Thanks Paul and
Speaker 1: happy to be here. Look what we saw yesterday was
Speaker 1: one of the darkest days in American history. This was predictable,
Speaker 1: it was preventable, and it represents an almost total lack
Speaker 1: of preparation. We should expect to see investigations about this
Speaker 1: for probably generations to come, and changes in the near future.
Speaker 1: I will tell you talking to our clients all over
Speaker 1: the world about contingency planning in the last twenty four hours.
Speaker 1: The big takeaway here is that there just didn't seem
Speaker 1: to be any well what it's changed. Who's protecting the
Speaker 1: capital today? So, Nnie, the Capitol Police are a very small,
Speaker 1: but very elite unit that's a little bit unusual in
Speaker 1: the American law enforcement inventory. Like the Supreme Court Police.
Speaker 1: They're one of the only two law enforcement organizations that
Speaker 1: don't that aren't part of the executive branch. They work
Speaker 1: for the Congress. So in order to get extra help,
Speaker 1: in order to plus up, they need to get additional
Speaker 1: resources from executive branch agencies. So another branch of the government. Similarly,
Speaker 1: the Metropolitan Police Department in Washington doesn't really have jurisdiction
Speaker 1: on the capital grounds because it's it's part of the
Speaker 1: federal the federal sovereign. So what's so frustrating about this?
Speaker 1: And this was work I used to do along with
Speaker 1: many many others in government that we do now for clients.
Speaker 1: You know, the capital is a space that's very easy
Speaker 1: to protect in the sense that we do it at
Speaker 1: least every year for the State of the Union. And
Speaker 1: there are these very complex, very well thought out plans
Speaker 1: that the Federal Interagency puts together towards things that are
Speaker 1: called national Security Special Events and s s s the
Speaker 1: highest tier of of of the stick security events, so
Speaker 1: things like the UN General Assembly, a presidential inauguration, the
Speaker 1: State of the Union, sometimes the Super Bowl. Right, there's
Speaker 1: a plan on the book that gets revisited every time
Speaker 1: there's a new one. And I know that there's been
Speaker 1: expensive planning going on for President of like Biden's inauguration
Speaker 1: for at least the last couple of weeks. This is
Speaker 1: something we should be good at, we should be well
Speaker 1: practiced at, and we should be able to do in layers.
Speaker 1: And given the threat environment that existed, the known threat
Speaker 1: environment that existed going into yesterday, the fact that that
Speaker 1: didn't happen is just beyond a belief. Jordan, Can I
Speaker 1: just jump in and ask who gives that command? Because
Speaker 1: right now we just learned the Chad Wolf is no
Speaker 1: longer in position. He has resigned. He was the acting
Speaker 1: Homeland Security director. Who who gives the orders and who
Speaker 1: who will do it now in his absence? Sure, Vonny,
Speaker 1: that that's a great question. So for things like national
Speaker 1: security special events, which this was not, the Department of
Speaker 1: Homeland Security through the Secret Service, is the lead coordinating agency.
Speaker 1: So you know, for a planned, coordinated deployment of people,
Speaker 1: like for the inauguration, it's usually going to be the
Speaker 1: Secret Service coordinating a lot of local law enforcement in
Speaker 1: the district Maryland, Virginia area, uh, and the entire sort
Speaker 1: of arsenal a federal law enforcement I understand that the
Speaker 1: FBI and the hostage rescue team got there relatively quickly
Speaker 1: that the Metropolitan Police Department around the perimeters of the
Speaker 1: capital is able to use what's called an iMac and
Speaker 1: Emergency Management Assistance Compact to get two hundred troops from Virginia.
Speaker 1: As to who does this now, there has to be
Speaker 1: a cognisant official, be it the Attorney General, the FBI director,
Speaker 1: the Secret Service director, or others that agrees to send
Speaker 1: their people in, or a National Guard deployment, which, although
Speaker 1: it was delayed for reasons which I suspect, will be
Speaker 1: investigated and will become clear uh in the coming weeks.
Speaker 1: UM work closely with again the very elite but clearly
Speaker 1: overmatched and overwhelmed officer and Capital police in a situation
Speaker 1: like this, Jordan, what do you say to the argument
Speaker 1: that perhaps a the less forceful defense of the Capitol
Speaker 1: yesterday resulted in relatively fewer casualties than there might have
Speaker 1: been had they taken a much stronger stance than in
Speaker 1: fact it was. You know, I think there are four fatalities,
Speaker 1: but it could have been so much worse. Is that
Speaker 1: a reasonable argument to make? I don't understand why the
Speaker 1: capital was not locked down? Uh? You know, a forceful
Speaker 1: response doesn't have to look like shooting people. It doesn't
Speaker 1: have to look like mass arrests. If you think about
Speaker 1: these sorts of things in advance, it might look like
Speaker 1: just making sure that the Capitol building is well secured,
Speaker 1: and it should be well secured, because there were a
Speaker 1: ton of upgrades after the September eleventh attacks, after the
Speaker 1: first Capitol Hill shooting, uh, and after the tragic shooting
Speaker 1: representatives police at a softball game making it harder to
Speaker 1: penetrate and then pushing layers of security out. It's not
Speaker 1: clear why those layers of security failed and why they
Speaker 1: weren't stop leading into the capital. Yeah. I mean, we're
Speaker 1: gonna have to fill some of these open positions, or
Speaker 1: at least designate somebody to take on their responsibilities for
Speaker 1: the next two weeks. Jordan's thank you so much for
Speaker 1: giving us those explanations. It is very important to understand
Speaker 1: the ins and outs of what actually happens. Jordan, of course,
Speaker 1: managing director at a crull, former White House and a
Speaker 1: Sea official and director of Preparedness in response for the
Speaker 1: National Security Division of the U s d O j
Speaker 1: and Jordan's strouss in Philly which also is you know,
Speaker 1: very very divided right now Philadelphia, Pennsylvania, I should say,
Speaker 1: with the final hurdle in counting electoral College votes last evening,
Speaker 1: I do want to mention as well that the incoming
Speaker 1: majority leader, Chuck Schumer has now called for the removal
Speaker 1: of President Trump. Well, it is time to look cross
Speaker 1: asset because as the NASTAG rises above at two percent,
Speaker 1: we also have the tenure yield almost at one point
Speaker 1: zero eight percent, we have a muted VIX and a
Speaker 1: Donar index that's again approaching in ninety. It is time
Speaker 1: to bring in Sarah Ponzac Crocess, that reporter here at Bloomberg. Sarah,
Speaker 1: what catches your eye most day as an expression of
Speaker 1: what's been happening in the country overnight, Well, it really
Speaker 1: is remarkable, and it feels like you're in two different worlds.
Speaker 1: Yesterday with the images of what we were seeing on
Speaker 1: Capitol Hill, and then you look at what was happening
Speaker 1: in markets before four pm, and yes, we saw some
Speaker 1: pairing of gains in equity markets, but nothing too remarkable.
Speaker 1: We didn't even see a loss of more than one
Speaker 1: percent in to day. And it can seem cold, and
Speaker 1: this is also almost an extension of what we've been
Speaker 1: talking about for almost a year now with the real
Speaker 1: economy with COVID nineteen and the stark differential when it
Speaker 1: comes to financial markets. But when you speak with investors
Speaker 1: on why we see this disconnect, why we're not seeing
Speaker 1: these images really affecting investors moods is Peter Bookvar, he's
Speaker 1: over ablicely advisory. I'll read you what he said this morning,
Speaker 1: and he said it very plainly. He said, there should
Speaker 1: be no mystery as to why the markets didn't care
Speaker 1: about what happened in the capitol yesterday. However disturbing, disgraceful,
Speaker 1: and embarrassing it was. It's because it is no bearing
Speaker 1: on the direction of the economy, earnings, an in trace
Speaker 1: interest rates. It's that simple. And like you mentioned, you
Speaker 1: look at the tenure this morning, just continuing it's climb higher.
Speaker 1: The tenure yield this morning is still up another more
Speaker 1: than four basis points. Yeah, we're seeing the yield curve steping.
Speaker 1: Easy point out, Sarah, and that's caused a couple of
Speaker 1: strategists want a Glomo Sax and dud and Um Jonathan
Speaker 1: Golubt credit Swiss to kind of upgrade their view of
Speaker 1: the big banks right, and Jonathan Golove's view. He also
Speaker 1: upgraded his view and his year in target for the
Speaker 1: SMP five hundred from forty two hundred. And it was
Speaker 1: an interesting take because he has been talking about how
Speaker 1: this rotation from growth to value was possibly over. That
Speaker 1: we had seen value out performance on a couple of
Speaker 1: solid days, that those being the days in which we
Speaker 1: got positive vaccine news when Janet Yellen was nominated to
Speaker 1: be Treasury secretary. Whoever, today he's overweighting cyclical assets. Like
Speaker 1: you mentioned, we see financials flying higher yet again and
Speaker 1: today up more than two percent. But we do see
Speaker 1: this interesting change today because you don't see this clear
Speaker 1: cut cyclical defensive tilt. Yes, we do see defensive equities
Speaker 1: under performing utilities pretty much flat on the day's staples,
Speaker 1: your second worst performing sector, however, still higher at the
Speaker 1: top of the pack, though you have tech and consumer
Speaker 1: discretionary mixed in with financials. So after seeing tech under
Speaker 1: performance yesterday, there are many reasons floated, especially with that
Speaker 1: we want to call it a blue ripple. The expectations
Speaker 1: from that, whether that be the possibility of higher capital
Speaker 1: gains and corporate taxes, not that that's expected because the
Speaker 1: Democrats did take the Senate by such a such a slim,
Speaker 1: narrow margin, but also just the expectations for higher rates
Speaker 1: since low rates have been such a boon for growth docks.
Speaker 1: But today we see tech coming back in a pretty
Speaker 1: big way. The NASDAC up more than two percent as
Speaker 1: we speak. Yeah, and we also have plenty of movement
Speaker 1: in credit markets. We have data coming in constantly showing improvement,
Speaker 1: not so much payroll of data, though, we still have
Speaker 1: you know, more than seven hundred thousand people making first
Speaker 1: time claims. Sarah right, it's a reality check. And yes,
Speaker 1: we did see initial jobless claims decline from a week earlier,
Speaker 1: but that's still a very large number, seven hundred eight
Speaker 1: seven thousand, it's it's extremely large. We saw a negative
Speaker 1: ADP print tomorrow. Of course, we will get that non
Speaker 1: Farm Perils report the first Friday of the new year,
Speaker 1: the first payrolls report of the new year. At some
Speaker 1: of those estimates have been downgraded brought lower after that
Speaker 1: a DP print that we did get, but this also
Speaker 1: is expected. Right now, we're seeing rising COVID cases. At
Speaker 1: least now we have seen a stimulus package past and
Speaker 1: and the expectation is for more stimulus down the pipeline
Speaker 1: by a matter of one trillion in total. Possibly. But
Speaker 1: where we stand now is this was expected. The data
Speaker 1: is expected to get worse. It's going to be hard
Speaker 1: to watch. But again, I know we've discussed it so
Speaker 1: many times and we hear it again and again from investors.
Speaker 1: And shotage is that the market is forward looking. It's
Speaker 1: looking past this, and it's looking at a time when
Speaker 1: the vaccine rollout really gets going, and the vaccine is
Speaker 1: a majority deployed, and you have a very high savings right,
Speaker 1: and all of a sudden, you have all this pent
Speaker 1: up demand that starts being filtered through the economy. Yeah,
Speaker 1: you wonder when you know, we see some of this, uh,
Speaker 1: you know, economic data, whether it's the job's claims or
Speaker 1: consumer spending start to cause some economists maybe to read
Speaker 1: look at some other economic forecast, I know, the bloombrick economics.
Speaker 1: Folks are looking for a slight contraction uh in the
Speaker 1: first quarter. Um, I won there's any building concern about
Speaker 1: downside risk? Is some of these economic forecasts well as
Speaker 1: of right now, an aggregate, I would say, looking through
Speaker 1: research notes, this morning from multiple different cell side research
Speaker 1: shops and and reading notes from economists, they're not really
Speaker 1: so focused. I mean, of course they put out their
Speaker 1: forecasts for a near term economic data, but when they
Speaker 1: look at GDP forecast for the year, everyone's revising their
Speaker 1: GDP forecast higher. That due to the expectations of more
Speaker 1: physical stimulus, more stimulus checks coming down the pipeline in
Speaker 1: addition to the six D it will likely add up
Speaker 1: to two thousand. Now that's the expectation and what that
Speaker 1: means for growth, what that means for savings, and what
Speaker 1: that means for the deployment of capital down the road
Speaker 1: and spending. So right now, if you look at aggregate
Speaker 1: for the year of one, and that's what markets are
Speaker 1: looking at two, we're seeing growth expectations just revised higher
Speaker 1: and higher. Yeah, it's really interesting here I'm looking at
Speaker 1: the real GDP forecast on the economic forecast three point
Speaker 1: nine percent one. Uh So, that's interesting how the economists
Speaker 1: are still looking for growth. Hey, Sarah, thanks so much
Speaker 1: for joining us. We appreciate that. As always, Sarah Pons
Speaker 1: that cross asset reporter for Bloomberg News. As the markets Fannie,
Speaker 1: despite everything we see in the world. They continue to
Speaker 1: move higher, don't they. Yeah. I mean, as I say,
Speaker 1: you can have all the political chaos that you want,
Speaker 1: but if you have leadership, or at least the promise
Speaker 1: of leaderships, there isn't that much to worry about for
Speaker 1: the market. Son in a sense, if there's more stimulus coming,
Speaker 1: which is the general consensus, if it's going to be
Speaker 1: a buy Harris administration, then you know, at least in
Speaker 1: the short term, that should be good for markets and
Speaker 1: corporate America. Absolutely, and I think that's kind of what
Speaker 1: we're seeing in the markets and what we've seen really
Speaker 1: since O's marchalows. Thanks for listening to Boomberg Markets podcast.
Speaker 1: You can subscribe and listen to interviews at Apple Podcasts
Speaker 1: or whatever podcast platform you prefer. I'm Bonnie Quinn. I'm
Speaker 1: on Twitter at Bonnie Quinn, and I'm Paul Sweeney. I'm
Speaker 1: on Twitter at pt Sweeney. Before the podcast, you can
Speaker 1: always catch us worldwide at Bloomberg Radio.