1 00:00:00,800 --> 00:00:04,040 Speaker 1: Welcome to the Bloomberg Markets Podcast. I'm Paul Sweeney, alongside 2 00:00:04,040 --> 00:00:06,920 Speaker 1: my co host Matt Miller. Every business day we bring 3 00:00:06,960 --> 00:00:11,520 Speaker 1: you interviews from CEOs, market pros, and Bloomberg experts, along 4 00:00:11,520 --> 00:00:15,600 Speaker 1: with essential market moving news. Find the Bloomberg Markets Podcast 5 00:00:15,600 --> 00:00:18,439 Speaker 1: on Apple Podcasts or wherever you listen to podcasts, and 6 00:00:18,480 --> 00:00:21,880 Speaker 1: at Bloomberg dot com slash podcast. All right, we've got 7 00:00:21,880 --> 00:00:23,799 Speaker 1: a couple of smart folks here to talk cars, because 8 00:00:23,800 --> 00:00:26,000 Speaker 1: there's a lot of I'm gonna let you literally drive 9 00:00:26,079 --> 00:00:29,280 Speaker 1: this conversation. Kevin Tinnan, he's with Bloomberg Intelligence, he's been 10 00:00:29,280 --> 00:00:33,040 Speaker 1: covering the auto industry for decades. And Elizabeth A. Bearman 11 00:00:33,200 --> 00:00:37,599 Speaker 1: with Bloomberg News. Join us here. And Kevin, you're you know, 12 00:00:37,840 --> 00:00:42,360 Speaker 1: you're internal combustion engine kind of guy. Have you have 13 00:00:42,440 --> 00:00:46,760 Speaker 1: you bought off on this the whole move to e 14 00:00:46,880 --> 00:00:49,520 Speaker 1: V Is that really where the industry is going? Would 15 00:00:49,520 --> 00:00:52,720 Speaker 1: you spend your own money on a hybrid? Kevin? Well, 16 00:00:52,800 --> 00:00:54,920 Speaker 1: here's the thing, right Like, so I'm a car guy 17 00:00:55,200 --> 00:00:59,480 Speaker 1: and I'm a profit guy, So so you know that 18 00:00:59,760 --> 00:01:03,200 Speaker 1: that's the thing. People will hear me speak in my 19 00:01:03,280 --> 00:01:06,160 Speaker 1: presentations and get this idea that I'm anti e V 20 00:01:06,360 --> 00:01:09,360 Speaker 1: and it's really not the case. It's just hey and Matt, 21 00:01:09,440 --> 00:01:12,559 Speaker 1: you know this, right, fast as fast, and a good 22 00:01:12,560 --> 00:01:14,880 Speaker 1: car is a good car, and reliable is reliable and 23 00:01:14,920 --> 00:01:17,440 Speaker 1: all that stuff. And I'm fine with all that. I'm 24 00:01:17,480 --> 00:01:22,520 Speaker 1: just saying that adoption, uh doesn't really happen because of 25 00:01:22,560 --> 00:01:26,720 Speaker 1: the supply side of the equation. When the automakers look 26 00:01:26,760 --> 00:01:29,120 Speaker 1: at their p and L. Right, it's basically as simple 27 00:01:29,160 --> 00:01:33,160 Speaker 1: as that. And you have places China, Europe where the 28 00:01:33,200 --> 00:01:36,360 Speaker 1: government is a little bit more involved driving that that 29 00:01:36,440 --> 00:01:39,479 Speaker 1: transition a little bit faster than it here is than 30 00:01:39,520 --> 00:01:41,160 Speaker 1: it is here in the US. Well, and you can 31 00:01:41,160 --> 00:01:43,920 Speaker 1: see that the automakers just haven't brought out all the 32 00:01:43,959 --> 00:01:47,039 Speaker 1: electric models that they easily could have. Right, take a 33 00:01:47,040 --> 00:01:50,440 Speaker 1: look at Forward, for example, the one electric Paul which 34 00:01:50,600 --> 00:01:54,360 Speaker 1: drove it is awesome, but they don't have an electric expedition. 35 00:01:54,560 --> 00:01:56,920 Speaker 1: They don't have an electric excursion, and they don't have 36 00:01:56,920 --> 00:02:00,840 Speaker 1: an electric explorer. Is because they don't nobody wants them. 37 00:02:00,880 --> 00:02:03,520 Speaker 1: Obviously they could. They could easily have made all of 38 00:02:03,560 --> 00:02:06,960 Speaker 1: those cars battery electric vehicles, but they didn't. And I 39 00:02:06,960 --> 00:02:09,239 Speaker 1: don't mean nobody wants them, but there's just not the 40 00:02:09,360 --> 00:02:13,280 Speaker 1: kind of adoption yet that they're even in Germany. Elizabeth 41 00:02:13,320 --> 00:02:16,640 Speaker 1: Berman joining us from Munich, right, she covers um the 42 00:02:16,639 --> 00:02:19,840 Speaker 1: auto industry across Europe for US. But that's where BMW is, 43 00:02:20,040 --> 00:02:23,880 Speaker 1: and they haven't made uh you know, fully electric X 44 00:02:23,880 --> 00:02:26,720 Speaker 1: five yet. They haven't electrified their whole fleet, even though 45 00:02:26,720 --> 00:02:29,280 Speaker 1: they've gone further, Elizabeth, than I'd say most of the 46 00:02:29,320 --> 00:02:33,040 Speaker 1: producers on the continent have. Yeah, absolutely. I mean I 47 00:02:33,040 --> 00:02:35,720 Speaker 1: would also say, from where you're all sitting, which is 48 00:02:35,800 --> 00:02:38,600 Speaker 1: namely in the US, I think it's easy to have 49 00:02:38,680 --> 00:02:41,280 Speaker 1: a different point of view than from over here, where 50 00:02:41,360 --> 00:02:44,160 Speaker 1: you know, every other car in certain city centers is 51 00:02:44,240 --> 00:02:48,760 Speaker 1: by now electric, and even plug in hybrids continue to 52 00:02:48,960 --> 00:02:51,800 Speaker 1: sail very well. There was an interesting note out today 53 00:02:52,000 --> 00:02:56,440 Speaker 1: from barclay'st that was actually talking about BMW and how 54 00:02:56,600 --> 00:03:00,280 Speaker 1: their electric cars actually doing really really well in terms 55 00:03:00,320 --> 00:03:03,720 Speaker 1: of profitability compared to their combatant engine cars, which is 56 00:03:03,960 --> 00:03:07,280 Speaker 1: really important. It is a very different market, right. I 57 00:03:07,360 --> 00:03:12,359 Speaker 1: drove to Ohio for Thanksgiving, um with my wife who 58 00:03:12,400 --> 00:03:15,680 Speaker 1: is from Spain. For me, a ten hour drive is normal, 59 00:03:16,240 --> 00:03:22,000 Speaker 1: right for her, that's like going from Spain to Poland, right, So, um, 60 00:03:22,040 --> 00:03:24,760 Speaker 1: you know, Europeans just don't make drives that but that's 61 00:03:24,800 --> 00:03:27,280 Speaker 1: a Pennsylvania cha long though. Yeah, it was, Well, there 62 00:03:27,320 --> 00:03:29,600 Speaker 1: are good trains over here and the and you have 63 00:03:29,680 --> 00:03:33,720 Speaker 1: fantastic trains, and um, I feel like the infrastructure is 64 00:03:33,760 --> 00:03:36,920 Speaker 1: even better. Right if I can find an electric charger 65 00:03:37,120 --> 00:03:40,400 Speaker 1: any parking spot in Berlin or Munich, it's not that 66 00:03:40,400 --> 00:03:43,000 Speaker 1: easy over again again, you know, it's Europe is more 67 00:03:43,040 --> 00:03:45,680 Speaker 1: densely populated that many many parts of the U S 68 00:03:45,720 --> 00:03:48,520 Speaker 1: which is a big difference. And then there's also differences 69 00:03:48,600 --> 00:03:50,800 Speaker 1: in taste that you were just talking about the f 70 00:03:50,920 --> 00:03:53,520 Speaker 1: one fifty, which is one of the most popular cars 71 00:03:53,640 --> 00:03:56,000 Speaker 1: in the US, and that kind of a car doesn't 72 00:03:56,000 --> 00:03:59,080 Speaker 1: really exist over here, right, no place the market I mean, 73 00:03:59,240 --> 00:04:01,800 Speaker 1: so kevity I fitted through the roads. If if there 74 00:04:01,840 --> 00:04:04,040 Speaker 1: were a room there, they would love them just as 75 00:04:04,160 --> 00:04:06,360 Speaker 1: much as we do, right you know. And that's a 76 00:04:06,520 --> 00:04:11,240 Speaker 1: that's a perfect point, is that even before electrification. Um, 77 00:04:11,280 --> 00:04:14,960 Speaker 1: you know, US automakers had a hard difficult time really 78 00:04:15,000 --> 00:04:19,080 Speaker 1: penetrating that European market, right because it was you know, 79 00:04:19,120 --> 00:04:21,480 Speaker 1: if you're a global automaker, you want to be sharing 80 00:04:21,520 --> 00:04:24,640 Speaker 1: platforms and parts and nameplates and the whole thing. Um, 81 00:04:24,760 --> 00:04:30,080 Speaker 1: what we what we prefer here are infrastructure is just 82 00:04:30,200 --> 00:04:34,080 Speaker 1: completely different. So you had our domestic automakers trying to 83 00:04:34,160 --> 00:04:40,040 Speaker 1: make small vehicles which were unprofitable and unpopular here for 84 00:04:40,080 --> 00:04:43,200 Speaker 1: that market, and it just, you know, essentially wound up 85 00:04:43,240 --> 00:04:47,520 Speaker 1: pulling out altogether in terms of we can't do that profitably. 86 00:04:47,560 --> 00:04:50,800 Speaker 1: We're not going to try and compete with uh, that 87 00:04:50,920 --> 00:04:55,240 Speaker 1: those European automakers in their backyard, and and we're just 88 00:04:55,279 --> 00:04:58,400 Speaker 1: gonna do what we do, which is um the preference 89 00:04:58,440 --> 00:05:02,560 Speaker 1: here in the US bigger try. So obviously different regions 90 00:05:02,560 --> 00:05:05,520 Speaker 1: have different tastes, but we've all seen the same same 91 00:05:05,560 --> 00:05:09,400 Speaker 1: trends in terms of pricing and supply chains. Right, Um, 92 00:05:09,440 --> 00:05:11,839 Speaker 1: the Europeans have had just as difficult a time getting 93 00:05:11,920 --> 00:05:15,880 Speaker 1: chips as US automakers have, and use cars. Use car 94 00:05:15,920 --> 00:05:18,640 Speaker 1: prices were off the charts last year or this year. 95 00:05:18,720 --> 00:05:22,200 Speaker 1: I guess I'm already on both sides of the Atlantic. 96 00:05:22,520 --> 00:05:25,880 Speaker 1: Is that changing, Kevin? Do you see pricing really getting softer? 97 00:05:27,279 --> 00:05:31,720 Speaker 1: It'll get softer from those peaks. But I think structurally 98 00:05:32,800 --> 00:05:36,320 Speaker 1: automakers look and I think everybody looks at the volume 99 00:05:36,360 --> 00:05:41,280 Speaker 1: line and says, oh, this is decreasing or this is declining, 100 00:05:41,480 --> 00:05:43,400 Speaker 1: And I think you have to layer in that price 101 00:05:43,480 --> 00:05:46,400 Speaker 1: power and margin power over it and look at the 102 00:05:46,480 --> 00:05:50,359 Speaker 1: revenue pool and say it's actually growing, so fewer units 103 00:05:50,560 --> 00:05:55,160 Speaker 1: but much higher transaction prices, which is better for the manufacturers. 104 00:05:55,160 --> 00:05:57,080 Speaker 1: I think we look at it from the consumers point 105 00:05:57,080 --> 00:05:59,600 Speaker 1: of view that well, I can't I can't get a 106 00:05:59,680 --> 00:06:03,159 Speaker 1: twenty five thousand dollar Cooper Sedan anymore. You know, I'm 107 00:06:03,200 --> 00:06:06,880 Speaker 1: all forty forty five thousand small suv or midsize suv. 108 00:06:07,600 --> 00:06:10,960 Speaker 1: And that's where the automaker wants us to live. That's 109 00:06:11,000 --> 00:06:14,719 Speaker 1: that's orchestrated. That's not by accident. Your point on the chips, 110 00:06:14,760 --> 00:06:17,200 Speaker 1: If I have a finite number of chips, well I'm 111 00:06:17,200 --> 00:06:19,839 Speaker 1: going to put them in my bigger, more expensive, wider 112 00:06:19,880 --> 00:06:24,480 Speaker 1: margin vehicles. Hey, Elizabeth, in Europe, what are the European 113 00:06:24,640 --> 00:06:28,800 Speaker 1: auto manufacturers saying about their expectations for demand? I mean, 114 00:06:28,880 --> 00:06:32,760 Speaker 1: you know, with a recession backdrop, with the continued to 115 00:06:32,920 --> 00:06:35,760 Speaker 1: war in Ukraine, what are you hearing from far from 116 00:06:35,800 --> 00:06:39,480 Speaker 1: the European automakers. Yeah, I mean, just apart from the 117 00:06:39,560 --> 00:06:42,680 Speaker 1: supply chain issues that Kevin was just addressing, the automakers 118 00:06:42,760 --> 00:06:46,719 Speaker 1: over here have a number of other factors to deal 119 00:06:46,800 --> 00:06:52,080 Speaker 1: with namely inflation that's even higher than than elsewhere UM 120 00:06:52,200 --> 00:06:55,400 Speaker 1: and UH. There's a lot of push pool and a 121 00:06:55,400 --> 00:06:59,719 Speaker 1: lot of absence of actual firm UM firm forecasts for 122 00:07:00,040 --> 00:07:04,080 Speaker 1: next year, which tells you just how cloudy the picture is. 123 00:07:04,400 --> 00:07:06,800 Speaker 1: But what I would say is that because of the 124 00:07:06,880 --> 00:07:09,320 Speaker 1: supply chain issues that we've had, but because of the 125 00:07:09,440 --> 00:07:12,560 Speaker 1: scarcity of parts, there's a lot of pent up demand 126 00:07:12,640 --> 00:07:16,280 Speaker 1: that car makers are still working down, which by some 127 00:07:16,680 --> 00:07:19,360 Speaker 1: estimates will take them at least into the middle of 128 00:07:19,520 --> 00:07:23,400 Speaker 1: next year and protect them from any consumers pulling back 129 00:07:23,440 --> 00:07:25,480 Speaker 1: as a result of having to fork out so much 130 00:07:25,520 --> 00:07:28,760 Speaker 1: more to pay for the energy builds. Yeah, and we 131 00:07:28,800 --> 00:07:32,440 Speaker 1: saw JP Morgan come out today upgrading the Tesco supplier, 132 00:07:32,840 --> 00:07:37,800 Speaker 1: placing Pirelli on positive catalyst watch, reiterating overweights on Valio 133 00:07:37,840 --> 00:07:43,600 Speaker 1: and Farrisia and Scheffler UM. So more and more analysts 134 00:07:43,640 --> 00:07:47,000 Speaker 1: are coming out with bullish calls. Are not only the manufacturers, 135 00:07:47,000 --> 00:07:51,480 Speaker 1: but also the UM UH, the suppliers that Elizabeth covers 136 00:07:51,480 --> 00:07:54,600 Speaker 1: as well. Great stuff, Kevin Tynan, Bloomberg Intelligence, thanks so 137 00:07:54,640 --> 00:07:57,880 Speaker 1: much for joining us. Elizabeth Berriman from blom Bloomberg Bloomberg 138 00:07:57,880 --> 00:08:01,080 Speaker 1: News in Munich, Germany, giving us a great perspective of 139 00:08:01,160 --> 00:08:04,360 Speaker 1: kind of what she's seeing from some of the European automakers. 140 00:08:04,400 --> 00:08:08,200 Speaker 1: But evs it is here, folks, get ready for this transition. 141 00:08:08,240 --> 00:08:10,360 Speaker 1: It is happening, uh, and it is something that the 142 00:08:10,360 --> 00:08:13,160 Speaker 1: automakers are making a big, hard pivot to and we 143 00:08:13,200 --> 00:08:20,680 Speaker 1: will continue to have full coverage there. Now I want 144 00:08:20,720 --> 00:08:22,960 Speaker 1: to get to Ben Emmons. He's in the studio with us, 145 00:08:23,200 --> 00:08:25,360 Speaker 1: which is great, and he is now the head of 146 00:08:25,360 --> 00:08:28,840 Speaker 1: fixed income and macro at New Edge Wealth. So it's 147 00:08:28,840 --> 00:08:32,720 Speaker 1: a new position um for Ben after Um, well, he 148 00:08:32,800 --> 00:08:35,120 Speaker 1: was at Medley last but he spent years at Pimco 149 00:08:35,280 --> 00:08:39,319 Speaker 1: as well. Um after being at a bank and at 150 00:08:39,480 --> 00:08:43,120 Speaker 1: usc which won't be in the playoffs they will not know, 151 00:08:43,240 --> 00:08:47,360 Speaker 1: but Ohio State University will be in Michigan. Yeah, we'll 152 00:08:47,360 --> 00:08:49,920 Speaker 1: get a sweet rematch in any case. Ben, great having 153 00:08:49,920 --> 00:08:52,000 Speaker 1: you in in the studio. Talk to us about your 154 00:08:52,000 --> 00:08:54,240 Speaker 1: new role. What are you doing at New Edge, Hey, 155 00:08:54,320 --> 00:08:57,600 Speaker 1: Matt Paul, thank you, it's a great feedback. Um. Yeah, 156 00:08:57,840 --> 00:09:00,600 Speaker 1: at New Edge, I'm involved in fixteen come, which is 157 00:09:00,720 --> 00:09:03,320 Speaker 1: kind of my expertise. So I had a fixed income 158 00:09:03,600 --> 00:09:08,240 Speaker 1: portfolio management. It's also multi asset. New actually is a 159 00:09:08,320 --> 00:09:12,480 Speaker 1: new wealth management from mostly came out of ubs UM. 160 00:09:12,480 --> 00:09:17,040 Speaker 1: It focuses on ultra high net worth individuals, entrepreneurs maybe 161 00:09:17,080 --> 00:09:20,240 Speaker 1: somewhat commonly known as ou our wealth management firms. Half 162 00:09:20,679 --> 00:09:24,080 Speaker 1: there's those institutional managements. So that's all my expertise comes 163 00:09:24,120 --> 00:09:26,839 Speaker 1: in there. It will be domestic fixed income, global fixing income, 164 00:09:26,880 --> 00:09:30,400 Speaker 1: multi asset, so go anywhere. Global macro will be still 165 00:09:30,480 --> 00:09:32,880 Speaker 1: very strong. But we count on your notes, We count 166 00:09:32,880 --> 00:09:36,760 Speaker 1: on your research that we get. We'll still get those. 167 00:09:38,000 --> 00:09:41,240 Speaker 1: It's deep, it's worth reading, and it comes out quickly 168 00:09:41,440 --> 00:09:43,960 Speaker 1: after events, so you'll still be able to produce that. Yes, 169 00:09:44,040 --> 00:09:47,120 Speaker 1: for sure, it's very time. What did you What did 170 00:09:47,160 --> 00:09:49,400 Speaker 1: you make of the job's number on Friday? Because it 171 00:09:49,440 --> 00:09:54,400 Speaker 1: strikes me that this market is off today, um because 172 00:09:54,440 --> 00:09:58,000 Speaker 1: of that job's number and because of feed expectations when 173 00:09:58,400 --> 00:10:02,640 Speaker 1: we weren't off on fri Day after the actual data. 174 00:10:02,880 --> 00:10:05,960 Speaker 1: I don't get why, although the initial reaction was that 175 00:10:06,000 --> 00:10:08,200 Speaker 1: we jumped at least and yields, which made a lot 176 00:10:08,240 --> 00:10:10,320 Speaker 1: of sense. Of course, you know what I did. I 177 00:10:10,320 --> 00:10:13,600 Speaker 1: did a very simple regression. I used jold Stata claims, 178 00:10:13,960 --> 00:10:17,080 Speaker 1: I s M employment data. Um. You know the other 179 00:10:17,160 --> 00:10:19,520 Speaker 1: kind of leading indictions from from employment and just put 180 00:10:19,559 --> 00:10:22,880 Speaker 1: them in a in a multi regression against bay rolls 181 00:10:22,920 --> 00:10:26,320 Speaker 1: and it spit out. A high phenomena was predicted. And 182 00:10:26,360 --> 00:10:28,240 Speaker 1: I looked at the history of the regression, although the 183 00:10:28,360 --> 00:10:30,600 Speaker 1: big standard era, but the huge spikes in there, and 184 00:10:30,679 --> 00:10:33,559 Speaker 1: each time that that spike happened, the pair ronoma came 185 00:10:33,559 --> 00:10:36,040 Speaker 1: out and did stronger. So it showed to me that 186 00:10:36,080 --> 00:10:38,880 Speaker 1: there's huge momentum still in the labor market. Maybe I'm 187 00:10:38,880 --> 00:10:41,520 Speaker 1: the example of it, I said, moving quick through another job. 188 00:10:42,040 --> 00:10:45,600 Speaker 1: So it told me like, yes, there's a weakling of 189 00:10:45,640 --> 00:10:47,640 Speaker 1: the economy. I didn't see what the I M. Services 190 00:10:47,720 --> 00:10:51,080 Speaker 1: was today. Probably maybe softer, but there's not like a 191 00:10:51,160 --> 00:10:54,480 Speaker 1: labor market recession. There's maybe a housing market recession or 192 00:10:54,559 --> 00:10:58,240 Speaker 1: rule decline, but labor markets are strong. So you should 193 00:10:58,240 --> 00:11:00,280 Speaker 1: be seeing this two y yield closer to where the 194 00:11:00,280 --> 00:11:03,000 Speaker 1: fifth phones rate is going to be next week, you know, 195 00:11:03,160 --> 00:11:06,320 Speaker 1: between four and a quarter to file four and a half. 196 00:11:06,360 --> 00:11:08,360 Speaker 1: It should put some pressure on the stock markets, but 197 00:11:08,360 --> 00:11:10,640 Speaker 1: it should give us a comfort of were not intercession 198 00:11:10,679 --> 00:11:13,520 Speaker 1: as we speak. So I'm with Neil. Data from Renaisson's 199 00:11:13,559 --> 00:11:17,200 Speaker 1: macro happen to be kind now staying on there, Neil, 200 00:11:17,280 --> 00:11:19,280 Speaker 1: good job, because he's right. I mean, this is actually 201 00:11:19,280 --> 00:11:22,720 Speaker 1: an economy that's not week it's actually continues to be resiling. 202 00:11:22,960 --> 00:11:25,240 Speaker 1: So we had the services number was good by the way, yea, 203 00:11:25,280 --> 00:11:28,480 Speaker 1: it came to smidge better services at fifty six and 204 00:11:28,559 --> 00:11:30,880 Speaker 1: a half. We were looking fifty for fifty three point 205 00:11:30,920 --> 00:11:33,280 Speaker 1: five and it's better than the fifty four point where 206 00:11:33,280 --> 00:11:35,720 Speaker 1: we got last month, right exactly, So some good numbers there, 207 00:11:36,040 --> 00:11:39,400 Speaker 1: so Ben. We had the gentleman on from a portfolio 208 00:11:39,440 --> 00:11:42,960 Speaker 1: manager on from Pimco last week, and the Pimco's historically 209 00:11:43,000 --> 00:11:45,120 Speaker 1: been I think over the last several years very bearish, 210 00:11:45,520 --> 00:11:48,080 Speaker 1: and they've been right. He started getting a little bit 211 00:11:48,120 --> 00:11:52,440 Speaker 1: more twank yeah uh, and you know, and now they 212 00:11:52,520 --> 00:11:55,520 Speaker 1: got a little bit more bullish. There is it a 213 00:11:55,600 --> 00:11:58,600 Speaker 1: time to go into and maybe scale up a fixed 214 00:11:58,640 --> 00:12:02,240 Speaker 1: income portfolio? Yeah you could. I mean I think we're 215 00:12:02,280 --> 00:12:05,640 Speaker 1: so the analysis is from from them and from other 216 00:12:05,720 --> 00:12:08,920 Speaker 1: perfolio managers. Yields are absolute level are high, so that 217 00:12:09,080 --> 00:12:11,960 Speaker 1: is appealing obviously, but then you have to keep in 218 00:12:12,000 --> 00:12:15,000 Speaker 1: mind that the inflation has not fully changed yet. The 219 00:12:15,040 --> 00:12:19,920 Speaker 1: COREPC number was somewhat moderate, but not enough I think 220 00:12:19,920 --> 00:12:21,920 Speaker 1: to say, well you can be full all in for 221 00:12:22,040 --> 00:12:25,160 Speaker 1: duration that is um. But what it does show is 222 00:12:25,200 --> 00:12:28,440 Speaker 1: that we've gotten to restrictive rate levels, so it put 223 00:12:28,480 --> 00:12:31,520 Speaker 1: spressure on the economy. For fixed income. That means that 224 00:12:31,600 --> 00:12:34,920 Speaker 1: you you can be you know, scale in as you say, 225 00:12:35,080 --> 00:12:38,680 Speaker 1: buy some duration, getting some corporate credit, stay still high 226 00:12:38,720 --> 00:12:42,280 Speaker 1: quality because if there is a recession, credits perssipal widen. 227 00:12:42,360 --> 00:12:46,000 Speaker 1: That's commonly assumed. But the duration is I think the 228 00:12:46,080 --> 00:12:49,120 Speaker 1: most important trade here that I personally like the front 229 00:12:49,160 --> 00:12:50,920 Speaker 1: end of the U curve because if the FAT is 230 00:12:50,960 --> 00:12:54,400 Speaker 1: moving to this restrictive rate, that could become overtightening that 231 00:12:54,520 --> 00:12:57,160 Speaker 1: may look like that. Then I think the one the 232 00:12:57,160 --> 00:12:59,679 Speaker 1: five year part of the U curve is extremely attractive. 233 00:12:59,760 --> 00:13:02,800 Speaker 1: If anything, as the FED moves to a slower pace, 234 00:13:02,880 --> 00:13:05,600 Speaker 1: and it's more clear about this message, even the volatility 235 00:13:05,640 --> 00:13:08,840 Speaker 1: of the short short maturity knows what the kind, so 236 00:13:08,920 --> 00:13:11,560 Speaker 1: it'll give you the better risk adjustive return. On the 237 00:13:11,559 --> 00:13:14,800 Speaker 1: front of the curves, I would favor it are where 238 00:13:14,800 --> 00:13:17,000 Speaker 1: do you see, I mean, what happens to like a 239 00:13:17,040 --> 00:13:21,679 Speaker 1: ten yere yield. Right now we're at three fifty UM. 240 00:13:21,720 --> 00:13:24,840 Speaker 1: If the FED goes to five let's say they go 241 00:13:24,920 --> 00:13:27,640 Speaker 1: to five five and a half. UM five is not 242 00:13:27,720 --> 00:13:30,319 Speaker 1: a stretch, right, that's just another couple of fifty basis 243 00:13:30,360 --> 00:13:33,520 Speaker 1: point hikes. But um does it make sense to have 244 00:13:33,760 --> 00:13:37,120 Speaker 1: I mean, historically would you see treasuries that far under 245 00:13:37,559 --> 00:13:41,439 Speaker 1: the federal funds rate? Yeah? So I think think about 246 00:13:41,440 --> 00:13:43,720 Speaker 1: the yelk of in this way. Right, So the inversion 247 00:13:43,760 --> 00:13:47,720 Speaker 1: currently is about really restrictive fat policy, That's what it's pricing. 248 00:13:48,360 --> 00:13:51,000 Speaker 1: It's not about an uncertain economy. Then the entire yuker 249 00:13:51,080 --> 00:13:53,560 Speaker 1: will be flat. All rates would be the same. So 250 00:13:53,960 --> 00:13:55,800 Speaker 1: if you think about this three and a half or 251 00:13:55,920 --> 00:13:59,000 Speaker 1: change of the tenure that should go to five, that 252 00:13:59,080 --> 00:14:01,079 Speaker 1: actually means that only that there will be maybe I 253 00:14:01,120 --> 00:14:04,800 Speaker 1: guess more surprises and fat policy, faster hikes, more aggression, 254 00:14:05,240 --> 00:14:07,000 Speaker 1: but also you end up in an economy that will 255 00:14:07,040 --> 00:14:09,240 Speaker 1: be so uncertain that that we don't know where we're 256 00:14:09,280 --> 00:14:12,360 Speaker 1: heading with having two high rates. So that doesn't seem 257 00:14:12,400 --> 00:14:14,600 Speaker 1: to be the case. The loan occurs seems to be sickling. 258 00:14:14,640 --> 00:14:18,240 Speaker 1: More about this is a restrictive enough policy, it will 259 00:14:18,280 --> 00:14:21,360 Speaker 1: get in facient at least start trending down. It may 260 00:14:21,360 --> 00:14:22,920 Speaker 1: not get the two percent, but at least start really 261 00:14:22,960 --> 00:14:26,200 Speaker 1: consistently trending down. Therefore it should stay below the fat 262 00:14:26,200 --> 00:14:28,960 Speaker 1: pronds rate RESUD. The two year coming on should be 263 00:14:29,440 --> 00:14:31,760 Speaker 1: where the fat puns rate comes out at. It's interesting 264 00:14:31,800 --> 00:14:33,920 Speaker 1: that the two year current is already trading for where 265 00:14:33,920 --> 00:14:36,960 Speaker 1: the fat pronds rate will be next week, actually cannon below. 266 00:14:37,280 --> 00:14:39,480 Speaker 1: So it's already saying that the market is or the 267 00:14:39,600 --> 00:14:42,480 Speaker 1: entire termsy market saying yeah, fat, you're probably getting an 268 00:14:42,520 --> 00:14:45,480 Speaker 1: overtightening zone if you will. Your message nine on the 269 00:14:45,480 --> 00:14:49,640 Speaker 1: Bloomberg terminal says the next big trade China full reopening. 270 00:14:49,960 --> 00:14:52,360 Speaker 1: What's your call there? It is a pool reopening. I'd 271 00:14:52,360 --> 00:14:56,080 Speaker 1: be very very on that team, um, you know to Actually, 272 00:14:56,080 --> 00:14:59,280 Speaker 1: my prior colleague, Brian Jackson is at net least great 273 00:14:59,280 --> 00:15:03,280 Speaker 1: analysts madly he you know, he and I talked a 274 00:15:03,280 --> 00:15:06,480 Speaker 1: lot about like this implicit message from from China has 275 00:15:06,520 --> 00:15:09,720 Speaker 1: been about trying to curb this virus strictly with these 276 00:15:09,760 --> 00:15:13,360 Speaker 1: really shorter lockdowns. But then you do reopen that again quick. 277 00:15:13,400 --> 00:15:16,360 Speaker 1: It's not like we're reading in March of twenty a 278 00:15:16,400 --> 00:15:19,880 Speaker 1: couple of weeks lockdown. So so and again, I think 279 00:15:19,960 --> 00:15:21,840 Speaker 1: the change that really happened a number of weeks ago, 280 00:15:22,120 --> 00:15:25,320 Speaker 1: allowing foreign flights to come in giving them access to 281 00:15:25,480 --> 00:15:29,400 Speaker 1: biontic fisor vaccine for foreigners to come in. That is 282 00:15:29,440 --> 00:15:31,520 Speaker 1: a deal that they made in twenty There's a larger 283 00:15:31,560 --> 00:15:34,760 Speaker 1: stockball behind it that maybe use eventually for China too. 284 00:15:35,160 --> 00:15:37,800 Speaker 1: But that's the first step to open your borders. The 285 00:15:37,920 --> 00:15:41,640 Speaker 1: second step, of course, is to open production again. China 286 00:15:41,680 --> 00:15:43,920 Speaker 1: doesn't want to get to an economy that's at at 287 00:15:43,960 --> 00:15:47,200 Speaker 1: three once again, economy at least five percent. So I've 288 00:15:47,360 --> 00:15:49,920 Speaker 1: just been on that framework saying this is an economy 289 00:15:50,000 --> 00:15:52,360 Speaker 1: that is going to fully reopen. I think that's the 290 00:15:52,400 --> 00:15:54,680 Speaker 1: big trade next year. And that does mean a lot 291 00:15:54,760 --> 00:15:56,800 Speaker 1: for commodities, right and for auto market. So you can 292 00:15:56,920 --> 00:15:59,440 Speaker 1: kind of see coming through since the protest broke out, 293 00:16:00,000 --> 00:16:02,960 Speaker 1: Come on you good stuff all right, Ben Emmons, thank 294 00:16:02,960 --> 00:16:05,480 Speaker 1: you so much for joining us here. Ben Emmons, he's 295 00:16:05,520 --> 00:16:08,280 Speaker 1: principal senior portfolio management had a fixed income in macro 296 00:16:08,520 --> 00:16:11,640 Speaker 1: at New Edge Wealth New We should explain the message nine, 297 00:16:11,720 --> 00:16:14,800 Speaker 1: by the way, for those of you without a Bloomberg terminal, 298 00:16:15,040 --> 00:16:17,520 Speaker 1: it's like you know when you had your A I 299 00:16:17,600 --> 00:16:21,560 Speaker 1: Am Away message. That's what the message nine is. Okay, 300 00:16:21,600 --> 00:16:23,080 Speaker 1: So we got that out there and it says the 301 00:16:23,160 --> 00:16:29,280 Speaker 1: next big trade. All right, let's talk banks. My former 302 00:16:29,400 --> 00:16:31,440 Speaker 1: one of my one of my many former employers, Credit 303 00:16:31,480 --> 00:16:36,360 Speaker 1: Swiss First Boston. The First Boston thing is coming back, kids, 304 00:16:36,400 --> 00:16:39,480 Speaker 1: We're bringing back the gang. Alison Williams sees the senior 305 00:16:39,520 --> 00:16:43,720 Speaker 1: Global banks UH analyst for Bloomberg Intelligence. You joined us 306 00:16:43,760 --> 00:16:46,320 Speaker 1: on the phone here. So, Allison, I've got Credit Swiss 307 00:16:46,400 --> 00:16:49,840 Speaker 1: the parent in Switzerland. I'm think I'm gonna have a 308 00:16:49,880 --> 00:16:53,040 Speaker 1: Credit Swiss First Boston kind of entity in the US. 309 00:16:53,760 --> 00:16:56,520 Speaker 1: And I've got Saudi Arabia investing some money. Can you 310 00:16:56,560 --> 00:16:59,440 Speaker 1: explain what's going on with our good friends? Fast Studies 311 00:16:59,480 --> 00:17:03,120 Speaker 1: are taking a so I al think of us kind 312 00:17:03,120 --> 00:17:06,720 Speaker 1: of what we need to know. So UH, Credit Sweez 313 00:17:06,840 --> 00:17:11,480 Speaker 1: is restructuring, which they announced at the end of October. 314 00:17:11,640 --> 00:17:14,680 Speaker 1: They're they're taking those steps which continue evolve. One is 315 00:17:14,760 --> 00:17:17,600 Speaker 1: the raising of capital, which has been going on over 316 00:17:17,680 --> 00:17:21,560 Speaker 1: the past couple of weeks. We've seen some UM pressure 317 00:17:21,560 --> 00:17:23,280 Speaker 1: in the shares related to that, as well as a 318 00:17:23,359 --> 00:17:27,119 Speaker 1: trading update given by the bank. But from a practical 319 00:17:27,480 --> 00:17:29,840 Speaker 1: UM point of view, you know, to other things that 320 00:17:29,920 --> 00:17:33,439 Speaker 1: they're doing, one of which is to UM get external 321 00:17:33,480 --> 00:17:37,399 Speaker 1: investors for the Securitized Products group, which they are spinning 322 00:17:37,440 --> 00:17:42,159 Speaker 1: out to um Apollo as as the key um UM 323 00:17:42,320 --> 00:17:46,080 Speaker 1: investor there, and then credit sweets First Boston. As you said, 324 00:17:46,119 --> 00:17:49,920 Speaker 1: they're rebranding the part of the business that really focuses 325 00:17:50,080 --> 00:17:54,560 Speaker 1: on the underwriting and m and a UM portion UM 326 00:17:55,000 --> 00:17:58,760 Speaker 1: and uh, you know, bringing bringing back management there as 327 00:17:58,800 --> 00:18:01,920 Speaker 1: well as the name and uh they're going to be 328 00:18:02,240 --> 00:18:04,399 Speaker 1: spinning that off. There's sort of no details on how 329 00:18:04,480 --> 00:18:07,040 Speaker 1: that's going to evolve. What we are getting UM in 330 00:18:07,160 --> 00:18:10,560 Speaker 1: dribs and drabs different UM investors that are interested in 331 00:18:10,840 --> 00:18:13,440 Speaker 1: that was part of the news today. Have anything I 332 00:18:13,480 --> 00:18:16,159 Speaker 1: can bring back all my credits was first Boston swag 333 00:18:16,320 --> 00:18:19,200 Speaker 1: that I have, like my golf shirts, my my hoodies, 334 00:18:19,320 --> 00:18:22,959 Speaker 1: my bad's good news. Yes, But Allison, have any UM 335 00:18:23,440 --> 00:18:29,959 Speaker 1: potential investors been allegedly directly responsible for the live dismemberment 336 00:18:30,000 --> 00:18:33,600 Speaker 1: of a journalist. I mean, I don't want to seem insensitive, 337 00:18:33,680 --> 00:18:35,679 Speaker 1: but it seems like no one's talking about this. Can 338 00:18:35,720 --> 00:18:39,360 Speaker 1: you really work for an investment bank if a murderer 339 00:18:39,760 --> 00:18:43,920 Speaker 1: is one of the big main investors. I mean, I'm 340 00:18:44,040 --> 00:18:47,879 Speaker 1: I'm I'm certainly not going to get into the politics 341 00:18:48,520 --> 00:18:52,159 Speaker 1: of the investment UM. You know, I think that the 342 00:18:52,240 --> 00:18:56,080 Speaker 1: difficulty with the credit sweez UM and and to your point, 343 00:18:56,119 --> 00:18:58,000 Speaker 1: there have been a lot of talk about sort of 344 00:18:58,040 --> 00:19:00,200 Speaker 1: where the money is coming from. That's that's going into 345 00:19:00,240 --> 00:19:04,520 Speaker 1: the bank UM. But for the bank UM, you know, 346 00:19:04,800 --> 00:19:08,359 Speaker 1: the key thing is to study and find some investors 347 00:19:08,760 --> 00:19:13,520 Speaker 1: and you know, maybe it's not UM. You know, maybe 348 00:19:13,560 --> 00:19:17,280 Speaker 1: it's not the targeted people that they would like UM. 349 00:19:17,880 --> 00:19:21,760 Speaker 1: So it's good that there is economic interest, but to 350 00:19:21,840 --> 00:19:23,399 Speaker 1: your point, they do have to think about sort of 351 00:19:23,440 --> 00:19:25,680 Speaker 1: where the money is coming from. How about is there 352 00:19:25,720 --> 00:19:29,560 Speaker 1: a snare here where the US arm this credit Swiss 353 00:19:29,600 --> 00:19:33,200 Speaker 1: fers Boston, where they spin it out into the public markets. Allison, 354 00:19:34,119 --> 00:19:37,320 Speaker 1: I think that is where they're headed, and they're just 355 00:19:37,440 --> 00:19:40,760 Speaker 1: really looking for I think some some anchor investors into 356 00:19:40,920 --> 00:19:46,080 Speaker 1: into the unit UM. But the intention seems to be 357 00:19:46,200 --> 00:19:48,639 Speaker 1: eventually it will be spun off into the public but 358 00:19:48,760 --> 00:19:51,800 Speaker 1: there's no details on timing or what that would look like. 359 00:19:53,240 --> 00:19:56,640 Speaker 1: So in Switzerland, in Zurich or where they bayed Zerch 360 00:19:56,720 --> 00:20:01,119 Speaker 1: or Geneva um Zurich, Okay, so in Zurich, are is 361 00:20:01,200 --> 00:20:04,960 Speaker 1: the plan here to really just focus the remaining credit suite, 362 00:20:05,800 --> 00:20:10,560 Speaker 1: primarily slest solely on the private wealth management it is. 363 00:20:10,680 --> 00:20:16,399 Speaker 1: It is getting to UM, you know, ubs and credit suites. 364 00:20:16,440 --> 00:20:18,320 Speaker 1: If we look at these banks, you know, over a 365 00:20:18,400 --> 00:20:20,440 Speaker 1: long period of time, the wealth business is really the 366 00:20:20,520 --> 00:20:24,399 Speaker 1: business that most investors are interested in because it's highly 367 00:20:25,359 --> 00:20:29,000 Speaker 1: it tends to be like highly revenue recurring UM, high 368 00:20:29,080 --> 00:20:35,040 Speaker 1: returns on investment and credit suites UM. Throughout some of 369 00:20:35,080 --> 00:20:37,720 Speaker 1: the pressures that they've had, UM, you know, sort of 370 00:20:37,800 --> 00:20:40,119 Speaker 1: coming to the four with some of the risk management issues, 371 00:20:40,240 --> 00:20:43,680 Speaker 1: but also on a fundamental basis UM from some of 372 00:20:43,760 --> 00:20:47,480 Speaker 1: these businesses, such as the securitized product unit. They are 373 00:20:47,560 --> 00:20:52,040 Speaker 1: looking to really focus their efforts on the wealth business 374 00:20:52,320 --> 00:20:55,520 Speaker 1: and then you know, spinning off these other businesses into 375 00:20:55,600 --> 00:20:59,960 Speaker 1: these sort of more creative solutions. All Right, It's interesting 376 00:21:00,160 --> 00:21:03,800 Speaker 1: to see, UM, you know, how this story is evolving. 377 00:21:04,000 --> 00:21:07,240 Speaker 1: It does seem like, you know, there were questions, UM, 378 00:21:07,400 --> 00:21:11,800 Speaker 1: existential questions about credit Suez. Are we beyond that. I 379 00:21:11,920 --> 00:21:15,200 Speaker 1: think that you know that the capital raising is close 380 00:21:15,280 --> 00:21:18,399 Speaker 1: to being done, and I think once that's done, UM, 381 00:21:18,760 --> 00:21:22,560 Speaker 1: there there can be some studying. Anytime a bank comes 382 00:21:22,600 --> 00:21:26,359 Speaker 1: out and says that they intend to raise capital, UM, 383 00:21:26,440 --> 00:21:28,520 Speaker 1: it's always gonna be hard for the for the shares 384 00:21:28,560 --> 00:21:29,960 Speaker 1: to study there's always going to be a lot of 385 00:21:29,960 --> 00:21:33,600 Speaker 1: ability to volatility until um that's complete. As you can 386 00:21:33,680 --> 00:21:37,600 Speaker 1: imagine when they had come out and and and and two. 387 00:21:37,680 --> 00:21:40,680 Speaker 1: When it comes out that there the offering price is 388 00:21:40,720 --> 00:21:44,639 Speaker 1: at such a significant discount UM, you know, that tends 389 00:21:44,680 --> 00:21:49,080 Speaker 1: to have an impact in terms of the um trading 390 00:21:49,119 --> 00:21:51,800 Speaker 1: prices of the shares, as you can imagine. And so 391 00:21:51,920 --> 00:21:55,359 Speaker 1: I think as once that is done, I think that 392 00:21:55,600 --> 00:22:01,200 Speaker 1: provides some some studying. The trading or the profit loss 393 00:22:01,800 --> 00:22:03,840 Speaker 1: that they're going to experience in the fourth quarter is 394 00:22:03,880 --> 00:22:06,119 Speaker 1: sort of significant, So it sort of takes away from 395 00:22:06,160 --> 00:22:08,280 Speaker 1: the from the shoring of the capital that they're doing 396 00:22:08,320 --> 00:22:11,399 Speaker 1: with this deal. UM. But I think you know, your 397 00:22:11,520 --> 00:22:13,200 Speaker 1: your question is more around like are we going to 398 00:22:13,560 --> 00:22:16,480 Speaker 1: see things steady? We are just a question of how 399 00:22:16,560 --> 00:22:18,960 Speaker 1: long it's going to take for things to revalue to 400 00:22:19,240 --> 00:22:22,080 Speaker 1: the upside. Alison just about thirty seconds left. Talk to 401 00:22:22,119 --> 00:22:24,000 Speaker 1: us about the new credit Swiss first, Boston. Is this 402 00:22:24,080 --> 00:22:25,920 Speaker 1: going to be a boutique type of thing, like a 403 00:22:25,960 --> 00:22:28,440 Speaker 1: Lazard or or Green Hill or something along those lines. 404 00:22:29,040 --> 00:22:31,320 Speaker 1: I mean, it sort of looks like it's it's aimed 405 00:22:31,400 --> 00:22:33,960 Speaker 1: that way in terms of focusing on the banking I 406 00:22:34,080 --> 00:22:38,720 Speaker 1: think what it does for the UM bankers and what 407 00:22:38,800 --> 00:22:41,320 Speaker 1: it does for the company is similar to what we've 408 00:22:41,359 --> 00:22:44,560 Speaker 1: seen UM with a lot of these boutique M and 409 00:22:44,600 --> 00:22:47,160 Speaker 1: A spinoffs, Right, so people can more of an eat 410 00:22:47,240 --> 00:22:50,400 Speaker 1: what you kill, and the bankers economics are purely focused 411 00:22:50,440 --> 00:22:55,159 Speaker 1: on deals, and that incents the bankers to want to 412 00:22:55,200 --> 00:22:58,119 Speaker 1: work in an environment like that and allows for the 413 00:22:58,160 --> 00:23:01,520 Speaker 1: compensation to be more directly related. All right, that's good stuff, 414 00:23:01,520 --> 00:23:04,640 Speaker 1: and it'll be UH. The CEO will be Michael Klein, 415 00:23:04,720 --> 00:23:07,080 Speaker 1: who I know back for my days at Solomon Smith Barney. 416 00:23:07,160 --> 00:23:11,080 Speaker 1: He is a serious player on Wall Street Global UH dealmaker, 417 00:23:11,200 --> 00:23:13,120 Speaker 1: deep ties in the Middle East, and I think we've 418 00:23:13,119 --> 00:23:16,359 Speaker 1: seen that evidence with the Saudi UH investment. Alison Williams, 419 00:23:16,359 --> 00:23:19,080 Speaker 1: thank you so much for joining us. Alison Williams, she's 420 00:23:19,080 --> 00:23:22,240 Speaker 1: the senior banks analyst for Bloomberg Intelligence. She's been covered 421 00:23:22,240 --> 00:23:28,159 Speaker 1: in the banks for decades. You want to get right 422 00:23:28,200 --> 00:23:30,080 Speaker 1: to our next guest, Matt Winkler. He's the founder of 423 00:23:30,119 --> 00:23:31,960 Speaker 1: Bloomberg News. He does some other stuff, but that's kind 424 00:23:31,960 --> 00:23:33,679 Speaker 1: of the highlight right there, because I want to get 425 00:23:33,760 --> 00:23:36,440 Speaker 1: right to his UH opinion Colm today, which is this 426 00:23:36,560 --> 00:23:39,040 Speaker 1: really interesting talks about the energy companies, and they've been 427 00:23:39,119 --> 00:23:41,600 Speaker 1: one of the sectors that has actually benefited this year 428 00:23:41,640 --> 00:23:44,040 Speaker 1: when all other stocks and bonds and things like that 429 00:23:44,119 --> 00:23:46,359 Speaker 1: are down, the energy stocks have done great. Why because 430 00:23:46,560 --> 00:23:49,359 Speaker 1: oil prices are higher in part due to what's going 431 00:23:49,400 --> 00:23:51,840 Speaker 1: on in Ukraine. Matt, thanks so much for joining us here, 432 00:23:52,080 --> 00:23:56,600 Speaker 1: uh in our Bloomberg Interactor Broker studio. UM, your your 433 00:23:56,640 --> 00:24:00,280 Speaker 1: comms entitled Biden is right to question oil stock bybe x. 434 00:24:01,080 --> 00:24:03,800 Speaker 1: What's the story here, mat? Okay, So we all know 435 00:24:03,960 --> 00:24:07,639 Speaker 1: that Russia invaded Ukraine in February, and we all know 436 00:24:07,800 --> 00:24:12,480 Speaker 1: that the price of oil went up dramatically, that the 437 00:24:12,560 --> 00:24:16,400 Speaker 1: price of gasoline at the pump, UH fetched a record 438 00:24:16,840 --> 00:24:22,040 Speaker 1: I think five dollars average price in June. And during 439 00:24:22,160 --> 00:24:27,080 Speaker 1: that period, oil companies in the US UM increased their 440 00:24:27,160 --> 00:24:30,920 Speaker 1: buy backs over you know, a four week period of 441 00:24:30,960 --> 00:24:34,320 Speaker 1: four quarter period, excuse me, more than a thousand percent. 442 00:24:34,920 --> 00:24:37,359 Speaker 1: So what does that mean. It means that the oil 443 00:24:37,480 --> 00:24:42,679 Speaker 1: companies were getting more cash from their business faster than 444 00:24:42,760 --> 00:24:47,120 Speaker 1: they could spend it or invested, and they were charging 445 00:24:47,200 --> 00:24:52,239 Speaker 1: the highest prices at the retail level for gasoline at 446 00:24:52,280 --> 00:24:56,240 Speaker 1: the lowest cost. So, if you believe in democracy, and 447 00:24:56,320 --> 00:24:59,720 Speaker 1: if you believe that free market capitalism is a direct 448 00:25:00,040 --> 00:25:03,200 Speaker 1: efficiary of democracy, then you have to ask the question, 449 00:25:03,760 --> 00:25:07,080 Speaker 1: why should the oil companies treat the invasion of Ukraine, 450 00:25:07,600 --> 00:25:13,480 Speaker 1: the destruction of human life, water, electricity, you know, everything 451 00:25:13,600 --> 00:25:16,159 Speaker 1: that we value in a democracy. Why should they be 452 00:25:16,280 --> 00:25:21,720 Speaker 1: allowed to benefit from that without acknowledging that they have 453 00:25:22,119 --> 00:25:25,760 Speaker 1: some loyalty to democracy. Do you suggest that they should 454 00:25:25,840 --> 00:25:30,040 Speaker 1: do well? Or what Biden? What Biden said was, look, Uh, 455 00:25:30,720 --> 00:25:34,919 Speaker 1: you could increase production. You know, we were releasing oil 456 00:25:35,080 --> 00:25:39,440 Speaker 1: from the reserves. Uh. Production is actually less today than 457 00:25:39,520 --> 00:25:43,040 Speaker 1: it was in two thousand nineteen, about nine less. So 458 00:25:43,240 --> 00:25:46,000 Speaker 1: he was saying, at a minimum, instead of just taking 459 00:25:46,080 --> 00:25:49,240 Speaker 1: all this cash that you suddenly have and using it 460 00:25:49,320 --> 00:25:52,240 Speaker 1: to buy back your shares and increase your dividends, you 461 00:25:52,400 --> 00:25:58,040 Speaker 1: could have increased some production. Uh, and responded that you 462 00:25:58,080 --> 00:26:00,320 Speaker 1: actually have incentives out there for us not to do that. 463 00:26:01,000 --> 00:26:04,600 Speaker 1: Talked to uh, sorry, we talked to oil executives quite 464 00:26:04,600 --> 00:26:06,560 Speaker 1: a bit and always ask why they don't invest more 465 00:26:06,760 --> 00:26:12,840 Speaker 1: And the answer is always um that this administration is 466 00:26:12,920 --> 00:26:16,080 Speaker 1: not friendly UM to that business. And you see it, 467 00:26:16,160 --> 00:26:20,000 Speaker 1: of course when UM CEO is go in front of Congress, 468 00:26:20,240 --> 00:26:22,440 Speaker 1: for example, when banks CEOs went in front of Congress 469 00:26:22,480 --> 00:26:25,359 Speaker 1: and they were in so much trouble for funding the 470 00:26:25,480 --> 00:26:28,720 Speaker 1: oil business. Um, and that's just funding it, right, So 471 00:26:28,880 --> 00:26:33,000 Speaker 1: the direct so so, Matt, let me put it this way. 472 00:26:33,760 --> 00:26:41,240 Speaker 1: Oil company profits, buybacks, dividends highest in our century. Okay, 473 00:26:41,600 --> 00:26:44,480 Speaker 1: we're twenty two years into the century, and you actually 474 00:26:44,560 --> 00:26:48,080 Speaker 1: have to go back to find a period where the 475 00:26:48,240 --> 00:26:51,159 Speaker 1: large s that we're talking about is as great it 476 00:26:51,440 --> 00:26:54,560 Speaker 1: is now. So it's kind of hard to have some 477 00:26:54,720 --> 00:26:58,399 Speaker 1: sympathy even if the oil companies are pushing back and saying, 478 00:26:58,560 --> 00:27:02,520 Speaker 1: you know, we're not getting supported. They've been supported all 479 00:27:02,600 --> 00:27:05,960 Speaker 1: the way through the twenty first century. The proof is 480 00:27:06,000 --> 00:27:09,240 Speaker 1: their bottom line, and their bottom line is as fat 481 00:27:09,960 --> 00:27:13,720 Speaker 1: and green as it gets. And so the question becomes, 482 00:27:14,240 --> 00:27:17,920 Speaker 1: just like in the nineteen forties, when other dictators were 483 00:27:18,040 --> 00:27:22,520 Speaker 1: rampaging through Europe, okay and threatening democracy here in the 484 00:27:22,640 --> 00:27:26,119 Speaker 1: United States, should we at least acknowledge that and do 485 00:27:26,320 --> 00:27:29,560 Speaker 1: something about it, because ultimately, we're all Americans, and it 486 00:27:29,640 --> 00:27:33,880 Speaker 1: doesn't matter where what ideological spectrum you come from, We're 487 00:27:33,880 --> 00:27:37,639 Speaker 1: all Americans and we all value democracy. So that the 488 00:27:38,359 --> 00:27:41,040 Speaker 1: question is what can the oil companies do differently now? 489 00:27:41,080 --> 00:27:44,840 Speaker 1: Other than investing in new production, because you say Biden's 490 00:27:44,840 --> 00:27:48,240 Speaker 1: concern is that they're exploiting the current. They could easily 491 00:27:48,440 --> 00:27:52,080 Speaker 1: have lowered the price at the pump or put pressure 492 00:27:52,119 --> 00:27:54,800 Speaker 1: on That's something that they could have an influence on, 493 00:27:55,359 --> 00:27:59,160 Speaker 1: and they didn't. Okay, there was no reason why Americans 494 00:27:59,240 --> 00:28:02,400 Speaker 1: had to pay the eighes price on record still much 495 00:28:02,480 --> 00:28:05,560 Speaker 1: lower than people pay for gasoline in other countries, though, 496 00:28:05,760 --> 00:28:07,359 Speaker 1: you know, I mean I I just came from Germany, 497 00:28:07,400 --> 00:28:09,600 Speaker 1: where we were paying seven dollars a gall so when 498 00:28:09,640 --> 00:28:12,040 Speaker 1: I hear people crying about that, But go back to Germany, 499 00:28:12,080 --> 00:28:14,120 Speaker 1: and what did they do in Germany? First of all, 500 00:28:14,200 --> 00:28:17,320 Speaker 1: the governments and the oil companies didn't protest, said Okay, 501 00:28:17,359 --> 00:28:21,560 Speaker 1: we're gonna take some of your profits, windfall profits, and 502 00:28:21,640 --> 00:28:24,320 Speaker 1: we're gonna make sure that the people who are suffering 503 00:28:24,359 --> 00:28:26,960 Speaker 1: the most get some of that benefit. And the oil 504 00:28:27,040 --> 00:28:29,600 Speaker 1: companies in Europe where you just were, said we don't 505 00:28:29,600 --> 00:28:32,080 Speaker 1: have a problem with that, And the British government just 506 00:28:32,240 --> 00:28:35,480 Speaker 1: did that. By the way, following the lead of European governments. 507 00:28:35,720 --> 00:28:38,040 Speaker 1: You have nothing like that in the United States. Now 508 00:28:38,240 --> 00:28:41,400 Speaker 1: in Europe, they really are sensitive to Ukraine because it 509 00:28:41,560 --> 00:28:43,920 Speaker 1: is in Europe. It's right on the border, so they 510 00:28:44,000 --> 00:28:47,200 Speaker 1: know what it means to lose your democracy, and so 511 00:28:48,000 --> 00:28:52,040 Speaker 1: the commitment there is much greater because of the sensitivity 512 00:28:52,440 --> 00:28:55,680 Speaker 1: of democracy at risk than it is here. But the 513 00:28:55,760 --> 00:28:58,960 Speaker 1: oil companies here could do exactly what has been the 514 00:28:59,040 --> 00:29:02,120 Speaker 1: behavior else where. Should there be some type of windfall 515 00:29:02,400 --> 00:29:06,440 Speaker 1: tax on some of these it's not unreasonable because these 516 00:29:06,480 --> 00:29:11,280 Speaker 1: are abnormal times. That's when you impose extraordinary measures. And 517 00:29:12,200 --> 00:29:16,520 Speaker 1: if we do value democracy, you'd like to think we do. Um, 518 00:29:17,000 --> 00:29:21,800 Speaker 1: there's nothing unreasonable about this, particularly since you folks every 519 00:29:21,880 --> 00:29:24,720 Speaker 1: day we're complaining about the high price of gasoline. Back 520 00:29:24,800 --> 00:29:28,239 Speaker 1: in June, and you were making that Biden's fault. I mean, 521 00:29:28,320 --> 00:29:32,360 Speaker 1: you didn't give us a parenthetical clause or context that said, oh, 522 00:29:32,520 --> 00:29:34,880 Speaker 1: this has nothing to do with Biden, which it really didn't. 523 00:29:35,640 --> 00:29:38,200 Speaker 1: You just said, well, he's the president, he should be blamed, 524 00:29:38,680 --> 00:29:42,840 Speaker 1: and prevailing media narrative was it's his fault. Okay, But 525 00:29:42,960 --> 00:29:46,080 Speaker 1: Americans are actually smarter than that, which is what we 526 00:29:46,240 --> 00:29:48,880 Speaker 1: learned on election Day just a few weeks ago. I mean, 527 00:29:49,040 --> 00:29:52,160 Speaker 1: I don't think we never blamed President Biden for the 528 00:29:52,280 --> 00:29:57,320 Speaker 1: market prices higher, right, but he was contain media, he 529 00:29:57,520 --> 00:30:02,600 Speaker 1: was the convenient. Okay, Uh, if you like person to 530 00:30:02,720 --> 00:30:05,360 Speaker 1: blame and did get blamed. What are the energy companies 531 00:30:05,400 --> 00:30:07,800 Speaker 1: saying here today? Are they just is there simple responses? 532 00:30:08,240 --> 00:30:10,320 Speaker 1: This is just the market. I mean, oil is it 533 00:30:10,440 --> 00:30:13,240 Speaker 1: wherever it is and there's no refining capacity out there. 534 00:30:13,320 --> 00:30:16,840 Speaker 1: So even if we pumped more oil. Absolutely, it's the indifference. 535 00:30:17,080 --> 00:30:21,080 Speaker 1: It's the indifference to massive suffering throughout Europe. It's the 536 00:30:21,160 --> 00:30:24,680 Speaker 1: indifference to suffering in Ukraine, the absence of even talking 537 00:30:24,760 --> 00:30:29,400 Speaker 1: about it. Um, you know, people have literally lost their 538 00:30:29,480 --> 00:30:34,840 Speaker 1: livelihoods and uh, it's happening every day and this, this 539 00:30:35,040 --> 00:30:37,400 Speaker 1: dictator is getting away with it. And so do we 540 00:30:37,560 --> 00:30:39,720 Speaker 1: want to be a party to that? Do we want 541 00:30:39,760 --> 00:30:42,400 Speaker 1: to acknowledge that we are benefiting from that? And the 542 00:30:42,440 --> 00:30:46,560 Speaker 1: answer should be no. And as Congress said, anything here 543 00:30:46,600 --> 00:30:50,520 Speaker 1: at you know, I'm sure the congressman that Congress folks 544 00:30:50,560 --> 00:30:53,400 Speaker 1: that are supportive of the energy industry don't want any 545 00:30:53,440 --> 00:30:55,400 Speaker 1: part of this. But has there been any movement within 546 00:30:55,440 --> 00:30:58,000 Speaker 1: Congress and say, hey, maybe we should think about something 547 00:30:58,080 --> 00:31:01,720 Speaker 1: like a war windfall tax or just a production bill 548 00:31:01,760 --> 00:31:04,200 Speaker 1: that says, hey, you know, there's a war going on 549 00:31:04,320 --> 00:31:06,480 Speaker 1: and we need to make sure we're not, or do 550 00:31:06,560 --> 00:31:08,560 Speaker 1: we need to get into it a little bit deeper 551 00:31:08,640 --> 00:31:11,400 Speaker 1: the US because that's what happened in World War Two. 552 00:31:13,040 --> 00:31:18,640 Speaker 1: Having the historical perspective would really help the discussion enormously, 553 00:31:18,880 --> 00:31:23,960 Speaker 1: because out of the depression that preceded World War Two 554 00:31:24,160 --> 00:31:28,280 Speaker 1: came UH the post World War two boom, and the 555 00:31:28,360 --> 00:31:31,920 Speaker 1: ascendants of the United States has unquestionably the number one 556 00:31:31,960 --> 00:31:34,400 Speaker 1: economy in the world, which it has held ever since 557 00:31:34,480 --> 00:31:37,440 Speaker 1: that time. And you know that was born out of, 558 00:31:38,120 --> 00:31:41,960 Speaker 1: if you will, Americans coming together in a way that 559 00:31:42,040 --> 00:31:44,800 Speaker 1: they hadn't up until that point. And it was for 560 00:31:44,880 --> 00:31:48,280 Speaker 1: the right reason. It was to defend democracy and create, 561 00:31:48,760 --> 00:31:52,160 Speaker 1: as Roosevelt said in Arsenal, for democracy. And it doesn't 562 00:31:52,200 --> 00:31:53,880 Speaker 1: feel like we're there in this well, no, it's it's 563 00:31:53,920 --> 00:31:56,400 Speaker 1: even reversed, right because the GOP, the sort of Marjorie 564 00:31:56,400 --> 00:31:59,160 Speaker 1: Taylor Greens of the world, are already against giving any 565 00:31:59,280 --> 00:32:03,320 Speaker 1: kind of UM financial aid, even just financial aid to Ukraine. 566 00:32:04,280 --> 00:32:10,480 Speaker 1: So yes, uh, we who are so fortunate uh to 567 00:32:10,640 --> 00:32:17,200 Speaker 1: benefit uh from our wonderful free market capitalism should understand 568 00:32:17,320 --> 00:32:22,520 Speaker 1: that it comes at uh a cost, and the cost 569 00:32:22,680 --> 00:32:26,240 Speaker 1: is our democracy. All right, Matt, great stuff. As always, 570 00:32:26,280 --> 00:32:30,240 Speaker 1: you can catch Matt column on Bloomberg dot Com, Slash 571 00:32:30,280 --> 00:32:33,520 Speaker 1: Opinion or O P I n go. Matt Winkler's editor 572 00:32:33,520 --> 00:32:37,320 Speaker 1: in chief emeritus Bloomberg News. Founded Bloomberg News a couple 573 00:32:37,360 --> 00:32:39,760 Speaker 1: of moons ago. Uh, and he's got his calm talking 574 00:32:39,760 --> 00:32:42,160 Speaker 1: about the energy industry and wrote the style of book 575 00:32:42,200 --> 00:32:44,480 Speaker 1: by which I Live, You Live Bike. We were talking 576 00:32:44,480 --> 00:32:47,320 Speaker 1: about me every day. Matt. On another mistake I've made 577 00:32:47,360 --> 00:32:50,280 Speaker 1: style wise, well, you just put infinity y L go 578 00:32:50,640 --> 00:32:53,200 Speaker 1: into I don't think split infinitives are in the style book. 579 00:32:53,200 --> 00:32:55,520 Speaker 1: I'm just personally against them. Okay, good stuff, all right? 580 00:32:55,640 --> 00:32:57,680 Speaker 1: Looking at oil right here, w T I crude oil, 581 00:32:57,880 --> 00:32:59,960 Speaker 1: and we were higher up at eighty two and change 582 00:33:00,080 --> 00:33:03,040 Speaker 1: now back below eighty dollars seventy nine dollars twenty nine 583 00:33:03,120 --> 00:33:06,240 Speaker 1: cents on w T I crewed brent eighty five dollars 584 00:33:06,280 --> 00:33:10,040 Speaker 1: and can I go to the Paul Sweeney Personal Inflation Index, Matt, 585 00:33:10,440 --> 00:33:12,840 Speaker 1: you like to look at regular unleaded gasoline, and I know, 586 00:33:13,160 --> 00:33:15,000 Speaker 1: I know so, but it it's you know, it's it's 587 00:33:15,040 --> 00:33:17,000 Speaker 1: been coming down, so I like to quote it. We're 588 00:33:17,040 --> 00:33:20,160 Speaker 1: here at three dollars and forty cents a gallon. How 589 00:33:20,200 --> 00:33:22,640 Speaker 1: about that I say, it's nowhere there in North Jersey. 590 00:33:22,680 --> 00:33:24,600 Speaker 1: I'll tell you that. In some of it's like three seventy. 591 00:33:24,760 --> 00:33:26,600 Speaker 1: The guys are giving me a thirty cent tax just 592 00:33:26,680 --> 00:33:28,840 Speaker 1: for living there, I guess, but we'll see. But we've 593 00:33:28,840 --> 00:33:31,760 Speaker 1: got energy prices pulling back here a little bit, along 594 00:33:31,800 --> 00:33:36,680 Speaker 1: with some of the other commodities. All right, Well, this 595 00:33:36,800 --> 00:33:40,640 Speaker 1: Senate runoff race down in Georgia, it is uh, you know, 596 00:33:40,680 --> 00:33:42,840 Speaker 1: we're at the finish line here and it is neck 597 00:33:42,920 --> 00:33:45,520 Speaker 1: and neck as far as I can tell. But obviously, yeah, 598 00:33:45,560 --> 00:33:47,200 Speaker 1: they're gonna head of the polls tomorrow, so that I'll 599 00:33:47,200 --> 00:33:48,960 Speaker 1: be interesting to see how that plays out because and 600 00:33:49,080 --> 00:33:52,320 Speaker 1: I think almost two million people have voted already. Yeah, 601 00:33:52,520 --> 00:33:55,240 Speaker 1: so that's the thing that early voting. Um, it's a 602 00:33:55,280 --> 00:33:56,640 Speaker 1: big deal down there. It's a big deal. So we're 603 00:33:56,680 --> 00:33:59,440 Speaker 1: gonna do a podcast on it. The Big Take podcast 604 00:33:59,640 --> 00:34:02,760 Speaker 1: is going to focus on this issue. Welcome West Kasova. 605 00:34:03,040 --> 00:34:06,080 Speaker 1: He's the host for Bloomberg's The Big Take podcast. So, West, 606 00:34:06,240 --> 00:34:08,880 Speaker 1: how are you guys approaching what is turning out to 607 00:34:08,960 --> 00:34:12,600 Speaker 1: be a you know, neck and neck race down in Georgia. Yeah, 608 00:34:12,680 --> 00:34:15,359 Speaker 1: it has been quite the race, and it's a little 609 00:34:15,400 --> 00:34:18,400 Speaker 1: bit of Dejabu because you remember the last time everything 610 00:34:18,520 --> 00:34:21,680 Speaker 1: came down to Georgia the control of the Senate. This 611 00:34:21,800 --> 00:34:24,440 Speaker 1: time we know that the Democrats have already gotten control 612 00:34:24,640 --> 00:34:26,800 Speaker 1: of the Senate. And so what we're talking about is, 613 00:34:27,200 --> 00:34:29,600 Speaker 1: if we already know Democrats have the Senate, why is 614 00:34:29,719 --> 00:34:32,880 Speaker 1: everyone so obsessed with this race? Like why does one 615 00:34:33,080 --> 00:34:37,319 Speaker 1: more potential vote for Democrats matter? Or if Republicans get 616 00:34:37,360 --> 00:34:39,360 Speaker 1: it doesn't really change the balance. So why is everyone 617 00:34:39,440 --> 00:34:43,239 Speaker 1: so obsessed with this race? Well, because of the way 618 00:34:44,600 --> 00:34:48,840 Speaker 1: Congress has been, right, I mean, you need an extra 619 00:34:49,160 --> 00:34:51,520 Speaker 1: Democrat or two if if they want to do anything, 620 00:34:51,600 --> 00:34:54,239 Speaker 1: as we uh saw in the last of course the 621 00:34:54,360 --> 00:34:56,719 Speaker 1: last couple of years, they if you get one or 622 00:34:56,760 --> 00:35:00,440 Speaker 1: two of them going rogue, it messes up everything, all right, 623 00:35:00,520 --> 00:35:03,080 Speaker 1: So there you go. We should have been on the show. Um, 624 00:35:03,280 --> 00:35:08,279 Speaker 1: that's exactly. There's two like really interesting things. One is, Um, 625 00:35:08,640 --> 00:35:11,280 Speaker 1: if you remember the last few a couple of years, 626 00:35:11,400 --> 00:35:15,040 Speaker 1: Joe Mansion, Democrat from West Virginia, managed to really tie 627 00:35:15,200 --> 00:35:19,560 Speaker 1: up Joe Biden's agenda just one senator and um, it's 628 00:35:19,719 --> 00:35:22,640 Speaker 1: it's easier for one senator to kind of go rogue, 629 00:35:23,120 --> 00:35:26,800 Speaker 1: um and hold things up much harder if um, you know, 630 00:35:27,280 --> 00:35:29,680 Speaker 1: you have to have two senators to do that, and 631 00:35:29,880 --> 00:35:34,000 Speaker 1: so just that one extra vote can really mean the 632 00:35:34,080 --> 00:35:37,040 Speaker 1: difference if you have one senator who's kind of crossing 633 00:35:37,200 --> 00:35:40,040 Speaker 1: zone and singing now. And then the other big thing 634 00:35:41,080 --> 00:35:43,239 Speaker 1: is committees. This is like kind of deep into the 635 00:35:43,320 --> 00:35:45,520 Speaker 1: guts of how the Senate works. Is if you have 636 00:35:45,600 --> 00:35:48,400 Speaker 1: a fifty fifty Senate with the tie type being broken 637 00:35:48,400 --> 00:35:52,400 Speaker 1: by Kamala Harris, Vice President, the committee assignment and what 638 00:35:52,600 --> 00:35:55,320 Speaker 1: the committees do and what they investigate is, we know 639 00:35:55,480 --> 00:35:58,160 Speaker 1: that's a big deal. Is much harder if it's fifty 640 00:35:58,760 --> 00:36:02,719 Speaker 1: the Democrats. Democrats have one more than the chairmanships and 641 00:36:02,880 --> 00:36:05,440 Speaker 1: all that kind of stuff that decides what the Senate 642 00:36:05,560 --> 00:36:09,759 Speaker 1: does completely changes. So it's interesting less. I mean, it 643 00:36:09,840 --> 00:36:12,040 Speaker 1: just this feels like it maybe you look at Georgia 644 00:36:12,040 --> 00:36:13,759 Speaker 1: and it could be a little bit of a a 645 00:36:13,880 --> 00:36:17,759 Speaker 1: litmus test for Donald Trump and his thoughts about because 646 00:36:17,840 --> 00:36:22,080 Speaker 1: the it's kind of breaking down along those lines in Georgia. Yeah, 647 00:36:22,120 --> 00:36:24,040 Speaker 1: that's another really good point. We talked about that on 648 00:36:24,160 --> 00:36:28,360 Speaker 1: the show UM today too, because you know, Donald Trump 649 00:36:28,680 --> 00:36:31,760 Speaker 1: really bad herschell Walker. He backed a whole lot of candidates, 650 00:36:31,800 --> 00:36:33,600 Speaker 1: a lot of them lost. That's one of the reasons 651 00:36:33,640 --> 00:36:36,120 Speaker 1: why Republicans are kind of a great Donald Trump because 652 00:36:36,120 --> 00:36:39,120 Speaker 1: he nominated some kind of out there candidates and voters 653 00:36:39,120 --> 00:36:41,600 Speaker 1: didn't like him. And this could be that last test. 654 00:36:41,719 --> 00:36:45,800 Speaker 1: Herschel Walker endorsed by Donald Trump. Um, if he loses, 655 00:36:46,080 --> 00:36:49,680 Speaker 1: it's kind of yet another bit of evidence for Republicans 656 00:36:49,719 --> 00:36:51,960 Speaker 1: to wonder. I don't know, maybe we'd go with Ryan Standards, 657 00:36:52,000 --> 00:36:54,000 Speaker 1: the governor of Florida, or somebody else of the next 658 00:36:54,040 --> 00:37:00,760 Speaker 1: time around. It just seems I mean, isn't herschel Walker 659 00:37:00,880 --> 00:37:03,600 Speaker 1: claiming that he didn't even pay for his girlfriend's abortion? 660 00:37:03,960 --> 00:37:05,759 Speaker 1: I know some people say that there is a check 661 00:37:06,360 --> 00:37:09,160 Speaker 1: um that proves he did, But it's kind of like 662 00:37:09,320 --> 00:37:11,799 Speaker 1: Mike Damone and Fast Times Ridgemont High. If you get 663 00:37:11,840 --> 00:37:14,120 Speaker 1: your girlfriend pregnant, then you don't even pay for her abortion. 664 00:37:14,239 --> 00:37:19,200 Speaker 1: Doesn't that rubbed voters the wrong way? Well, this has 665 00:37:19,239 --> 00:37:21,719 Speaker 1: been a pretty big issue. I mean, you know, so 666 00:37:21,880 --> 00:37:25,799 Speaker 1: herschel Walker, yes, he denies that any of this happened. Um, 667 00:37:26,080 --> 00:37:29,840 Speaker 1: and he's the one claiming to be pro life. Robael Warner, 668 00:37:29,920 --> 00:37:35,320 Speaker 1: who's a minister uh is uh is saying, you know, 669 00:37:36,200 --> 00:37:39,279 Speaker 1: bringing this up, uh, And it's an interesting thing that 670 00:37:39,320 --> 00:37:43,600 Speaker 1: a lot of evangelical voters are siding with Walker even 671 00:37:43,640 --> 00:37:46,560 Speaker 1: though he has this kind of problem and he's trying 672 00:37:46,640 --> 00:37:50,719 Speaker 1: to explain, uh, and it just gets into how complicated 673 00:37:50,719 --> 00:37:54,759 Speaker 1: American politics are. It just seems like he looks so bad, right, 674 00:37:54,920 --> 00:37:58,440 Speaker 1: because whether you're four or against abortion, we probably all 675 00:37:58,480 --> 00:38:01,320 Speaker 1: agree you should show up with a check um, you know, 676 00:38:02,080 --> 00:38:04,719 Speaker 1: instead of leaving your girlfriend high and dry and making 677 00:38:04,760 --> 00:38:08,279 Speaker 1: her pay for it herself and then h On the 678 00:38:08,360 --> 00:38:12,120 Speaker 1: other side, there can be no greater star power in 679 00:38:12,200 --> 00:38:18,680 Speaker 1: American politics than Barack Obama. He shows up two stomp 680 00:38:18,960 --> 00:38:25,480 Speaker 1: for warnock, isn't that enough to swing like everybody in Georgia, Well, 681 00:38:25,480 --> 00:38:27,239 Speaker 1: it depends on who they are. In a lot of 682 00:38:27,320 --> 00:38:31,040 Speaker 1: parts in Georgia, Barack Obama is the problem, not the solution. 683 00:38:31,200 --> 00:38:32,759 Speaker 1: You know, like a lot of Southern states, a lot 684 00:38:32,840 --> 00:38:36,000 Speaker 1: of other states. In cities like Atlanta, they tend to 685 00:38:36,040 --> 00:38:39,719 Speaker 1: be uh more Democratic, but in the suburban areas and 686 00:38:39,880 --> 00:38:42,680 Speaker 1: especially in the rural areas, they tend to be more Republican. 687 00:38:43,000 --> 00:38:46,319 Speaker 1: You know, So Barack Obama showing up definitely gets Democrats 688 00:38:46,360 --> 00:38:49,880 Speaker 1: out there. What's interesting is on the Republican side, they 689 00:38:49,960 --> 00:38:53,480 Speaker 1: pretty much told Donald Trump, please don't come here and 690 00:38:53,800 --> 00:38:56,560 Speaker 1: campaigned for herschel Walker because you're not going to help 691 00:38:56,960 --> 00:38:59,680 Speaker 1: so well, Democrats are very happy to have one former 692 00:38:59,719 --> 00:39:02,399 Speaker 1: press and to show up. Republicans really don't want their 693 00:39:02,440 --> 00:39:05,080 Speaker 1: former residents there, right, And it's isn't it all about 694 00:39:05,120 --> 00:39:08,520 Speaker 1: the swing voters? I mean, obviously Republicans are not going 695 00:39:08,560 --> 00:39:11,920 Speaker 1: to vote for Warnock, and clearly Democrats are not going 696 00:39:11,960 --> 00:39:15,520 Speaker 1: to vote for herschel Walker. But the swing voters make 697 00:39:15,600 --> 00:39:19,880 Speaker 1: the difference, don't they? Yeah, they do. And and Georgia 698 00:39:19,960 --> 00:39:22,360 Speaker 1: is a really interesting state because you know, they're in 699 00:39:22,400 --> 00:39:24,320 Speaker 1: the whole left swing voters left, Like we've seen this. 700 00:39:24,680 --> 00:39:27,759 Speaker 1: Presidential races are just anybody, it's the margins. So most 701 00:39:27,800 --> 00:39:29,600 Speaker 1: people have made up their minds, but in a state 702 00:39:29,719 --> 00:39:32,640 Speaker 1: like Georgia, you're still like a big question. Is Georgia 703 00:39:32,719 --> 00:39:34,200 Speaker 1: a red state or is there what they call it 704 00:39:34,280 --> 00:39:35,960 Speaker 1: purple state? You know, it's kind of like it it 705 00:39:36,880 --> 00:39:38,480 Speaker 1: goes a little bit this way and a little bit 706 00:39:38,480 --> 00:39:40,640 Speaker 1: of that way, depending who the candidates are. And so 707 00:39:40,800 --> 00:39:44,319 Speaker 1: if herschel Walker wins, then it looks pretty pretty much 708 00:39:44,480 --> 00:39:48,200 Speaker 1: like Georgia is a red state because Walker has not 709 00:39:48,400 --> 00:39:50,520 Speaker 1: been a very attractive candidate to a lot of people. 710 00:39:50,560 --> 00:39:56,160 Speaker 1: Even some Republicans underperformed. Um the governor who you know, Kemp, 711 00:39:56,200 --> 00:39:59,040 Speaker 1: who won very very well, He got many fewer voters, 712 00:39:59,080 --> 00:40:02,640 Speaker 1: which shows you that dumb Republicans voted for Camp to 713 00:40:02,680 --> 00:40:06,400 Speaker 1: be governor, voted you know, either didn't vote for Walker 714 00:40:06,560 --> 00:40:10,720 Speaker 1: or voted for Warnuck. So if war Nick the Democrat 715 00:40:10,840 --> 00:40:13,759 Speaker 1: is able to win, then like Georgia is the state 716 00:40:13,840 --> 00:40:17,239 Speaker 1: that you were gonna really be watching, is possibly voting 717 00:40:17,280 --> 00:40:21,239 Speaker 1: for the Democrat. All right, what's good stuff? We appreciate that. Westcasova. 718 00:40:21,320 --> 00:40:25,160 Speaker 1: He's the host of Bloomberg's Big Take podcast. You can 719 00:40:25,200 --> 00:40:28,400 Speaker 1: get that wherever you get your podcasts. And uh uh 720 00:40:28,520 --> 00:40:31,600 Speaker 1: this week they're looking at the Senate race. Uh, the 721 00:40:31,960 --> 00:40:33,439 Speaker 1: you know, kind of the walk off. If you will, 722 00:40:35,640 --> 00:40:38,680 Speaker 1: thanks for listening to the Bloomberg Markets podcast. You can 723 00:40:38,760 --> 00:40:42,480 Speaker 1: subscribe and listen to interviews with Apple Podcasts or whatever 724 00:40:42,640 --> 00:40:46,240 Speaker 1: podcast platform you prefer. I'm Matt Miller. I'm on Twitter 725 00:40:46,560 --> 00:40:50,319 Speaker 1: at Matt Miller three. On fal Sweeney, I'm on Twitter 726 00:40:50,440 --> 00:40:53,239 Speaker 1: at pt Sweeney. Before the podcast, you can always catch 727 00:40:53,320 --> 00:40:54,839 Speaker 1: us worldwide at Bloomberg Radio