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Speaker 1: Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keane along

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Speaker 1: with Jonathan Ferrell and Lisa Brownwitz Jailey. We bring you

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Speaker 1: insight from the best and economics, finance, investment, and international relations.

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Speaker 1: Find Bloomberg Surveillance on Apple Podcast, Suncloud, Bloomberg dot com,

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Speaker 1: and of course on the Bloomberg terminal. Gerard cassidy with

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Speaker 1: us with OURBC Capital Markets. Gerard, I've got a fiction

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Speaker 1: five year dividend growth coming off the trauma of fourteen percent.

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Speaker 1: Forget about that statistic. What's the model dividend growth that

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Speaker 1: JP Morgan can deliver? I think, Tom, when you take

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Speaker 1: a look at the excess capital that these banks have,

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Speaker 1: including JP Morgan Chase, in their core revenue and earnings growth,

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Speaker 1: that divotting growth should be considered into the high single digits.

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Speaker 1: I think that's reasonable anywhere from six to These are

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Speaker 1: not double digit, you know, dividend growers. Now, there are

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Speaker 1: periods like the one we just came out of where

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Speaker 1: some banks increased dividends by double digit rates. But you

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Speaker 1: must remember last year dividends were frozen because of the pandemic,

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Speaker 1: and there was a catchup. I think in the recent

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Speaker 1: announcement about dividend increases. So when you overlay share buy

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Speaker 1: back on that, are you starting January one with a

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Speaker 1: JP Morgan cash on cash return above eight percent? Dare

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Speaker 1: dare I get out to eleven and a double digit

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Speaker 1: share by back dividend combination? I think time you can

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Speaker 1: see that the combination of the share repurchases in the

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Speaker 1: dividends could easily exceed earnings Donchester JP Morgan, but for

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Speaker 1: the industry as they again have this excess capital, So

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Speaker 1: that would suggest, yes, we could see those types of

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Speaker 1: numbers that you mentioned from JP Morgan as well as

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Speaker 1: some of the other banks in the large bank universe.

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Speaker 1: There is a high bar, and they met that high

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Speaker 1: bar in almost everything, with the exception being fixed income,

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Speaker 1: commodities and currencies treading, And yet the shares are lower

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Speaker 1: and pre market trading. What's your response to that, especially

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Speaker 1: given that the only other disappointment that I'm seeing right

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Speaker 1: now is that interest income. It's gonna be interesting because

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Speaker 1: the total revenue revenue number, as you guys have identified,

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Speaker 1: was a little better than expected, and that's important. Um.

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Speaker 1: The other factor, though, is the supplementary leverage ratio fell

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Speaker 1: to five point four percent from the prior quarters five

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Speaker 1: point six. Now by regulation they cannot breach five. Internally,

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Speaker 1: they have a five and a quarter percent internal model

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Speaker 1: that says they can't go below that. So the deposit

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Speaker 1: growth you saw, once again, very significant deposit growth because

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Speaker 1: of the monetary policy this country is pursuing with quantity

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Speaker 1: and easing, and it's forcing these wholesale banks balance sheets

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Speaker 1: to basically busted the seams. So I think maybe there's

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Speaker 1: a little concern here that this leverage ratio is getting

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Speaker 1: Parisley close to their required minimum that they have set,

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Speaker 1: which is five and a quarter percent. And now one

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Speaker 1: morning slightly this we've got to ask the question LinkSA,

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Speaker 1: but we aren't down one point to seven per cent

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Speaker 1: after a look at the numbers themselves fram this appropriately,

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Speaker 1: I understand that. Still, when you see beats pretty much

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Speaker 1: across the board, it's such huge numbers. It is interesting

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Speaker 1: that the knee jerk responses, that's all you got for me,

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Speaker 1: and you have to wonder what people are looking at

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Speaker 1: to see that, especially given the fact that there have

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Speaker 1: been losses to some of the big banks over the

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Speaker 1: past few weeks, which are just a final question. JP

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Speaker 1: Morgan at the Gate first. Now we're gonna have the

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Speaker 1: compare and contrast in the next couple of days. What

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Speaker 1: are you looking for based on what you've seen already

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Speaker 1: this morning. I think what we're gonna see, John, is

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Speaker 1: that their fixed number was It was slightly blow expectations,

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Speaker 1: but it was still a very good number. So I

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Speaker 1: think we have to keep an eye on the other banks.

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Speaker 1: Big fig trading, but equity trading, as you put it out, John,

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Speaker 1: was better than expected. So I think from Goldman and Morgan,

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Speaker 1: Stanley City Bank America we should expect equity trading numbers

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Speaker 1: maybe to come in better and sleep. The investment banking number,

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Speaker 1: as you identified, was also better than expected, so I

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Speaker 1: think the others are going to have similar numbers. And

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Speaker 1: as I think we least have pointed out, um, they

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Speaker 1: are taking market share from their European competitors, and I

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Speaker 1: think that we're showing up again in the numbers we've

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Speaker 1: seen so far this morning. The JP Morgan setting the

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Speaker 1: bar for government sacks will hear from them in a

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Speaker 1: round about thirty minutes time. Gerard. I appreciate your time

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Speaker 1: today this especially it's nice to work through the numbers

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Speaker 1: in real time with you general cassidy there of OURBC

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Speaker 1: capital markets. The economy is much more open than it was.

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Speaker 1: Why is there such a rapid increase and why are

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Speaker 1: not people investing that elsewhere? Let's ask that question to

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Speaker 1: our Stagia amorro So and a new CE capital network.

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Speaker 1: The chief investment strategist joins us right now on the stage,

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Speaker 1: you're gonna catch up. Let's go there. To Lisa's point,

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Speaker 1: we're all projecting this big boom in growth this year,

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Speaker 1: and that's largely developed through the first half of what

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Speaker 1: the consumers do with their cash has been slightly confusing.

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Speaker 1: What's you'll read on things? Yeah, I think the consumers

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Speaker 1: have been venturing out into the real economy and they

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Speaker 1: have been gradually putting that cash to work. I mean,

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Speaker 1: I definitely think we see that in some of the

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Speaker 1: reopening categories. For example, we see hotels that are pretty

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Speaker 1: much back. We see restaurants, we see the travel services

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Speaker 1: that are pretty much back. The consumers have also been

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Speaker 1: switching from the durable goods to the services, and so

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Speaker 1: that's what we're seeing now. But to Lesa's point is

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Speaker 1: to come back to the banking sector, I think some

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Speaker 1: of the strength and the consumer that we're seeing and

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Speaker 1: the credit card spending data that's going to start to

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Speaker 1: shift to the business sector. Part of the really weak

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Speaker 1: spot in loan growth for the banks is actually the

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Speaker 1: commercial and industrial loan growth is just not been there.

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Speaker 1: But as the economy comes back online, as the CEO

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Speaker 1: cefos are increasingly comfortable with where things are, they're going

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Speaker 1: to start to boost their capex plans and that's gonna

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Speaker 1: need to require some loans in financing. So I think

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Speaker 1: that's what we're likely to see for the banking sector

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Speaker 1: over the next few quarters. Um I think JP Morgan

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Speaker 1: is a sign of kind of things to come for

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Speaker 1: the banking sector. Broadly. This is a solid result, but

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Speaker 1: nobody is surprised. Everybody is already expecting a hun increase

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Speaker 1: in this quarter's earnings year over years, so nobody is surprised.

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Speaker 1: I still think though there's more cattalysts to come for

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Speaker 1: the banking sector, and the stage are a little bit off.

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Speaker 1: You're remitted I capital, but you've got fabulous experience, maybe

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Speaker 1: like no one I know on the street of moving

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Speaker 1: from stodgy old bank to massive fintech advance like it

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Speaker 1: I capital. Do these big banks just have the high

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Speaker 1: ground because they're so large and they're so technologically advantaged

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Speaker 1: over all the other banks. Well, so given the balance

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Speaker 1: she's and given the tech budgets for some of these banks,

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Speaker 1: absolutely they do have the advantage and putting them money

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Speaker 1: to work and accelerating UH the innovation. So the question

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Speaker 1: is how much is the pace of this innovation accelerates

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Speaker 1: and are they nimble enough? Are they quick enough? So

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Speaker 1: while I like the banking sector, the reason why fin

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Speaker 1: techs are so attractive to us is because the big

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Speaker 1: banks are not seeing a little growth. These smaller banks

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Speaker 1: are seeing rapid UH market share acquisition. And you know,

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Speaker 1: you look at neo banking, for example, digital banks with

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Speaker 1: no physical branches. The revenues of that sector today probably

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Speaker 1: twenty billion dollars. In five years time, that twenty billion

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Speaker 1: goes most likely to four hundred billion dollars. So this

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Speaker 1: is a significant growth and I think the fin techs

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Speaker 1: can definitely capture that opportunities that in a more pure

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Speaker 1: way than a traditional bank sector can. Anastasia, are there

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Speaker 1: any real data points within these earnings that matter right now?

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Speaker 1: Given the fact that so much of people's view on

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Speaker 1: banks really just hinges on what will happen later on

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Speaker 1: perhaps Q four. Yeah. I would say there's two things

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Speaker 1: to note about bank results today. First of all, where's

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Speaker 1: the strength, where's the bright spot in these result it's

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Speaker 1: actually investment banking, advisory fees, advisory revenues. If you look

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Speaker 1: at the strength and the equity capital markets is just stunning.

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Speaker 1: For example, M and A had a banner quarter. Uh,

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Speaker 1: the volumes are up about I p o s have

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Speaker 1: had a banner quarter in a banner year. They're up

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Speaker 1: close to two in terms of volumes. So the investment

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Speaker 1: banks are absolutely reaping the benefits. I think that's going

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Speaker 1: to continue for some time, for a number of quarters

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Speaker 1: because if you think about the preconditions that have been

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Speaker 1: put in place to support this market, yeat zero rates,

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Speaker 1: which lurwered investors into areas of higher growth and innovation economy.

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Speaker 1: That's not going to change. Look at the fund flows

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Speaker 1: they're going into, thematic funds, thematic ETFs, anything from robotics

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Speaker 1: to space tourism to a gene therapy. That's not going

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Speaker 1: to change. So as a result, the public markets are

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Speaker 1: offering premium valuations for some of these high tech, high

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Speaker 1: growth stocks and who's reaping the benefits of those higher

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Speaker 1: valuations are rid at companies. They're tapping this I p

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Speaker 1: O window. They're going public, and as a result, they're

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Speaker 1: probably getting evaluation that's three and a half times more

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Speaker 1: the last private round after the first day of trading.

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Speaker 1: So the private equity investors are reading reaping the benefits,

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Speaker 1: but also the banks, of course are reaping the benefit

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Speaker 1: through those advisory revenues. So I think that's going to

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Speaker 1: be an area of strength force time time to come now, Lisa.

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Speaker 1: The other point of this is a lot of optionality.

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Speaker 1: As you say, we don't know what's going to happen

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Speaker 1: in the future, but we can tell what's priced in

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Speaker 1: and we can guess where that may go. Loan growth

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Speaker 1: is flat today, that's likely to inflate, inflect higher interest

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Speaker 1: rates or zero Today the markets are pricing in a

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Speaker 1: rate hike and a half through What if we get

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Speaker 1: there a little faster, what if we increase it a

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Speaker 1: little bit more. That's optionality that's embedded in the banking

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Speaker 1: sector right now. And then there's capital returns. There's excess

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Speaker 1: capital that these banks have to return, so share reports, dividends,

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Speaker 1: all of that is very favorable for the sector and

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Speaker 1: a state you always gotta catch up. Thank you, busy

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Speaker 1: morning for us, for you too, and stay amos that

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Speaker 1: of on Capital Network, The chief investment strategist Stephen Biggart

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Speaker 1: joins US now with Argus Director of Financial Institutions Research. Stephen,

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Speaker 1: let me ask you the question, as Shannali Basik was

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Speaker 1: adamant not to answer it here. How do these book

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Speaker 1: value dynamics move. Does the giant and wonderful JP Morgan

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Speaker 1: come in relative to the other banks? Do they advance

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Speaker 1: their book value ratio versus JP Morgan? I think they do.

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Speaker 1: I mean this is an environment where um, you know,

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Speaker 1: the the banks that have the best opportunity for for

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Speaker 1: longer term growth, more diversification, U steady or earning stream

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Speaker 1: I think are the ones that that get you know,

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Speaker 1: will continue to get the premium in terms of price

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Speaker 1: the book. So you know JPM as a company that's

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Speaker 1: it's extraordinarily well diversified. Uh, they do benefit when capital

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Speaker 1: markets are strong as they are currently and frankly if

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Speaker 1: they have been the last four quarters, but of course

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Speaker 1: it's been Goldman Saxes. Uh, you know, a cup of

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Speaker 1: tea In terms of the you know, the last four quarters,

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Speaker 1: so we've had great M and A, we've had solid

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Speaker 1: investment banking, you know, trading results. Of course, they're starting

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Speaker 1: to uh you know, pull back a little bit from

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Speaker 1: I would you know, call just unsustainably high levels over

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Speaker 1: the past few quarters. Do they amend or do they

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Speaker 1: have a plan to diminish these sterling balance sheet ratios

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Speaker 1: or do they just let it right out? Do they

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Speaker 1: manage them lower or not? Well, I think they've tried,

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Speaker 1: of course, And uh, if you're talking about in terms

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Speaker 1: of more sustainable capital returns, I think they'd very much

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Speaker 1: like to do that, but still a precarious time for

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Speaker 1: the economy. I think we uh you know, they'll probably

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Speaker 1: uh you know, keep those a bit a bit longer. Uh.

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Speaker 1: You know, they do have much more flexibility now in

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Speaker 1: terms of capital returns than they did um prior. Uh

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Speaker 1: so you know, the FED has been less of a

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Speaker 1: babysitter in terms of U you know, the actual uh

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Speaker 1: dividend and shareholder uh share buy back. So you know

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Speaker 1: they've got that flexibility now to uh to you know,

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Speaker 1: sort of give and take between the two. I think

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Speaker 1: that gives them a lot more flexibility, and I think

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Speaker 1: they're you know, writing out this uh, this economic recovery

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Speaker 1: and uh and seeing what they can do, you know,

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Speaker 1: sustainably for the long term. And tell me you asked

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Speaker 1: the questions. So let's just look at the performance so

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Speaker 1: far year today. There's twenty percentage points of out performance

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Speaker 1: on Goldman versus JP Morgan so far year today on

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Speaker 1: Goldman Tom JP Morgan. Look, JP Morgan's had a great

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Speaker 1: year so far, just Goldman SAX has had a fantastic

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Speaker 1: year so far. Well, there's just two different platforms. John

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Speaker 1: jan Hatzi is coming out of GDP estimates within the report,

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Speaker 1: I believe, and what's important to me John is Sinali

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Speaker 1: Basik mentioned you go back to two thousand nineteen for

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Speaker 1: a pre pandemic compare. If you take two years of

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Speaker 1: their estimated GDP growth, you end up with eleven point

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Speaker 1: five percent growth twenty four months, which is five point

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Speaker 1: seven five percent per year run rate. In America's in

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Speaker 1: the vicinity of two to three percent. Well, let's look

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Speaker 1: at the forecast in the release this morning, Tom GDP

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Speaker 1: growth in twenty one expected at six point eight percent.

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Speaker 1: In the U s U S GDP growth in twenty

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Speaker 1: two four point seven percent, So you look at six

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Speaker 1: point eight percent this year, four point seven percent next year.

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Speaker 1: And Steven Bigger asked you the question that great GDP figures,

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Speaker 1: is that something that some of these banks can actually leverage,

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Speaker 1: because so far it hasn't translated into the long growth

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Speaker 1: that the banks of JP, Morgan investors in those names

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Speaker 1: were hoping for. Do you start to see that happen

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Speaker 1: in Q four and beyond, Well, I think it's a

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Speaker 1: second half help for the banks. Long growth as a

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Speaker 1: started to resume at this point. I mean that that's

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Speaker 1: going to be the you know, the most likely beneficiary

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Speaker 1: for banks, just to get the loan balances to expand

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Speaker 1: a little bit where they've just been, uh, you know,

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Speaker 1: sort of held back. And we think there's a number

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Speaker 1: of reasons for that. You know, confidence previously had not

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Speaker 1: been where it needed to be. Had tons of government

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Speaker 1: stimulus in the form of enhanced unemployment benefits or you know,

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Speaker 1: the outright checks to individuals, so so Americans are were

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Speaker 1: flush with cash they didn't need to borrow, but that

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Speaker 1: wears off, you know, the enhanced unemployment benefits in September,

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Speaker 1: the stimulus checks are are are gone now, so I

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Speaker 1: think we've seen some improvement in credit card lending. We've

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Speaker 1: seen some improvement in the auto ending, uh you know,

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Speaker 1: home equity as well. So I think they do begin

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Speaker 1: to benefit in the back half from a from a

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Speaker 1: bit stronger loan growth environment. Of course, yields have have

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Speaker 1: been a headwind here with with the tenure pulling back

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Speaker 1: as it has. We think that's more technical and short

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Speaker 1: term and we'll get you know, a little bit uh

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Speaker 1: stuper yield curvis the balance of the years goes by.

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Speaker 1: So I think the lending business outlook is is a

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Speaker 1: bit improved here than it than it was even a

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Speaker 1: quarter or ago. Stephen, let's go there. I often ask

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Speaker 1: the question, you want to see a data point in

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Speaker 1: earnings release, what does it change? Is there anything in

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Speaker 1: these releases this morning that will change anything for a

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Speaker 1: bank built or a bank bear for that matter, Do

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Speaker 1: we resolve anything with this week's earnings. Well, it's a

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Speaker 1: great question. Uh, you know, it's not a you know,

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Speaker 1: a single quart or just not a terrific bank make

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Speaker 1: or or a terrific you know, industry or rebound. So

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Speaker 1: I think the you know, we've had such a great

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Speaker 1: rebound in financial stocks generally that you know, there could

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Speaker 1: be a pause here as as we kind of get

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Speaker 1: an evaluation moving into the second half. Of course, the

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Speaker 1: comments on the quarterly calls here are going to be

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Speaker 1: pretty important, particularly as as it comes again to long growth. Um.

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Speaker 1: You know, the in my view, the case or bank

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Speaker 1: stocks is really a fold that we that we do

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Speaker 1: get that loan growth resurgence, that we have a bit

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Speaker 1: steeper yield curve that these uh you know, the credit

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Speaker 1: quality remains stellar, not to the point of having a

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Speaker 1: massive reserve releases as as we're now seeing from we

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Speaker 1: saw at least from JP Morgan, and then the much

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Speaker 1: better capital returns which are uh you know demonstrated after

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Speaker 1: a moratorium last year due to the pandemic, we're you know,

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Speaker 1: we're seeing some nice return of capital now. So I

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Speaker 1: think there is you know, it could be a pause

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Speaker 1: here as as we as we look out in the

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Speaker 1: second half and that's the next year. But look, I

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Speaker 1: think everybody is expecting rates to move but higher. That's

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Speaker 1: going to be benefits special for banks. Um. Yeah, of

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Speaker 1: course if we get that, if we get that rebound

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Speaker 1: and loan growth, that's going to be critical as well,

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Speaker 1: and a lot of people seem to believe that there

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Speaker 1: will be that growth at rebound in loan growth, and

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Speaker 1: yet we're still seeing deposits growth so much. We're not

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Speaker 1: seeing consumers spend that incredible amount of dry powder that

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Speaker 1: people are expecting them to spend. Isn't that concerning loans?

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Speaker 1: Loan growth will pick up, but when matters? And if

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Speaker 1: it doesn't pick up until next year, won't that be

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Speaker 1: a bit of a bear case? Well or a pause case?

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Speaker 1: As I mentioned, I think I don't think it's a

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Speaker 1: reason to sell banks when you have sort of this

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Speaker 1: this flatish loan growth environment. Uh. So, you know, it is,

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Speaker 1: as you said, a little a little troubling that that

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Speaker 1: that consumers can you know, do continue to uh, you know,

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Speaker 1: save at the rates that they have. Uh and and

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Speaker 1: banks are flush with deposits. You know, that's a double

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Speaker 1: edged sword. Obviously that it's a great funding source, but

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Speaker 1: you know, funding is not It's not the problem for

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Speaker 1: banks right now. It's it's trying to get more more

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Speaker 1: borrowers out there. And I think that's that's going to

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Speaker 1: have to come with an improving economy. I don't think

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Speaker 1: you can grow the economy too at the extent that

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Speaker 1: we're expecting without some some benefit from that return of

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Speaker 1: long growth. Hey, Stephen, gotta leave it that. Stephen Bigger,

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Speaker 1: August Financial Institutions Research Director. Let's bring in Hugh Johnston,

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Speaker 1: PepsiCo Vice Chairman and CEO. Hugh, great morning to have

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Speaker 1: you on. An hour ago, we had a really hot

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Speaker 1: CPI for in America. A lot of that is traced

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Speaker 1: back to the reopening theme that we can get into

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Speaker 1: in just a moment. But from your perspective as a

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Speaker 1: company leader corporately to an America and beyond, how do

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Speaker 1: you navigate this increase in prices we're experiencing state side

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Speaker 1: over the last few months. Yeah, absolutely, good morning and

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Speaker 1: nice to be with you all. Obviously, our company is

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Speaker 1: performing very well right now, and and a part of

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Speaker 1: that is navigating some of the challenges from a cost perspective.

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Speaker 1: That the biggest thing we can do in order to

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Speaker 1: manage that candidly is we invest in our brands, and

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Speaker 1: we invest in innovation, and by virtue of doing those things,

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Speaker 1: we create products that consumers are willing to pay more

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Speaker 1: for and that allows us to take price increases that

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Speaker 1: that help us offset that inflation. So it's something that

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Speaker 1: that obviously all big companies are dealing with right now,

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Speaker 1: and frankly, I think we're very well positioned to deal

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Speaker 1: with it. It's interesting when I have policymakers on the

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Speaker 1: show to you, When I have central bankers, Federal Reserve officials,

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Speaker 1: they take this line that a lot of this is transitory.

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Speaker 1: The bond investors do the same thing. When I talk

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Speaker 1: to corporate leaders, I send something a little bit different.

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Speaker 1: How much daylight you sent this between you and the

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Speaker 1: policymakers making the calls down in Washington. Well, we're always

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Speaker 1: a little bit conservative on this front, right so I'm

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Speaker 1: not going to assume it's gonna be transitory. I'm going

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Speaker 1: to assume it's probably gonna be around for a little while,

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Speaker 1: and then we'll build our plans around that. If we

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Speaker 1: happen to get surprised with inflation lowering itself more quickly,

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Speaker 1: that's great, we'll we'll we'll adjust to that. But right now,

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Speaker 1: I'm assuming it's going to be with us through the

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Speaker 1: better part of next year. We've had some talk about

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Speaker 1: sharpening cost management initiatives. You does that mean cost cuts

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Speaker 1: or can you pass on a lot of this to

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Speaker 1: the end consumer? It's gonna be both. I mean, as

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Speaker 1: a company, we have a history of driving costs down.

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Speaker 1: We we announced this morning we're extending our productivity program

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Speaker 1: through a north of a billion dollars a year, and

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Speaker 1: we've been taking out a billion hollars a year plus

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Speaker 1: since two thousand and twelve. So we're always looking to

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Speaker 1: run the company as efficiently as we possibly can because

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Speaker 1: we don't want to waste dollars in any direction. That said,

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Speaker 1: when when input cost increase, we're also going to take

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Speaker 1: some pricing. We do it every year, and we'll do

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Speaker 1: it again as as we get to the fall of

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Speaker 1: this year. Here, my colleague Kelly Lines went through the

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Speaker 1: revenue mix and the company at the moment where you're

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Speaker 1: seeing growth and where we're seeing a bit of contraction

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Speaker 1: as well as we see the increased mobility in a

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Speaker 1: place like North America here in the United States. How

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Speaker 1: is that increased mobility translating and into the change in

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Speaker 1: the revenue mix of a Pepskuchi. Yeah, it clearly is

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Speaker 1: moving more towards what we refer to as the out

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Speaker 1: of home channels, So whether it's the food service of

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Speaker 1: restaurants and the like, and also convenience stories. Mobility clearly

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Speaker 1: drives those channels. At the same time, what we refer

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Speaker 1: to as the take home channels are actually still growing

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Speaker 1: as well. Uh, so we're seeing good benefit across the board.

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Speaker 1: The reason for that primarily is we made a decision

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Speaker 1: last year that despite the pandemic, we were going to

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Speaker 1: continue to invest in growth capacity. We were going to

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Speaker 1: continue to invest in our brands. And as a result,

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Speaker 1: now as consumers have come back where they're ready to

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Speaker 1: capture that business and we're gaining market share as a result.

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Speaker 1: You and I talked about how sticky some of his

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Speaker 1: consumer behavior might be shortly after the pandemic and then

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Speaker 1: lockdown when reopens. You you finally got it is sticky,

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Speaker 1: you finally got consumed as a snap him back to

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Speaker 1: old things, old habits. Yeah, I think it's a little

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Speaker 1: bit of both. In all candor, it's not an either

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Speaker 1: word type of thing. Clearly, as mobility comes back there,

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Speaker 1: they're they're back in the habits of sort of balancing

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Speaker 1: out healthier reading and then the occasional treat or indulgence.

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Speaker 1: The one thing that seems to be sticking a bit

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Speaker 1: more is breakfast at home. That that's a trend that

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Speaker 1: I think people have sort of forgotten about breakfast at

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Speaker 1: home pre pandemic. They rediscovered it and they discovered they

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Speaker 1: liked it. So I think as we moved to these

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Speaker 1: more hybrid working models, breakfast at home will remain elevated. Obviously,

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Speaker 1: our Quaker business was down in the second quarter, but

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Speaker 1: on a two year basis, it's up about nine cent.

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Speaker 1: I expect this to maintain some level of elevated performance

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Speaker 1: versus where we were two years ago. Just before I

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Speaker 1: let you go, just one final question, if I may.

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Speaker 1: I always enjoy having you on the program because we

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Speaker 1: get to go away from some of the core themes

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Speaker 1: of the morning just for a minute or so. Let's

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Speaker 1: do that right now. In the last week, the White

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Speaker 1: House came out with an executive order on promoting competition

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Speaker 1: in the American economy, and one of the themes, a

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Speaker 1: couple of themes that came out of that was this

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Speaker 1: idea that consolidation is bad because it holds down wages

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Speaker 1: and it leads to an increase in prices. I just

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Speaker 1: wonder for your firm, specifically, what your message would be

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Speaker 1: for the administration after they put that out. Well, obviously

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Speaker 1: there was a lot in that executive order, and most

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Speaker 1: of it I don't think has a substantial impact on us.

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Speaker 1: The thing we're obviously always concerned about is having a

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Speaker 1: level playing field and enhancing competitiveness. So to the degree

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Speaker 1: that things do those those two outcomes, we're happy with it.

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Speaker 1: To the degree that it reduces the level of competitiveness, obviously,

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Speaker 1: that's something we'd wo'd be less happy with, and that

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Speaker 1: was the aplomatic response I kind of expected, Hugh, it's

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Speaker 1: gonna catch up. Thanks for making some time for us

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Speaker 1: on a busy morning, Hugh jo Uston. That a pepskud

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Speaker 1: vice chairman, and say f This is the Bloomberg Surveillance Podcast.

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Speaker 1: keene In. This is Bloomberg