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Speaker 1: Welcome to the Bloomberg p m L Podcast. I'm Pim Fox.

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Speaker 1: Along with my co host Lisa A. Brahmowitz. Each day

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Speaker 1: we bring you the most important, noteworthy, and useful interviews

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Speaker 1: for you and your money, whether you're at the grocery

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Speaker 1: store or the trading floor. Find the Bloomberg p m

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Speaker 1: L Podcast on Apple Podcasts, SoundCloud, and Bloomberg dot com.

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Speaker 1: It is my pleasure to introduce Gerald Government. He is

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Speaker 1: the senior principal partner and chief Investment Officer of Government Partners.

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Speaker 1: He joins us here as an expert in all things

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Speaker 1: real estate and Gerald Government. I wonder if you could

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Speaker 1: just describe a little bit for people that may not

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Speaker 1: be familiar with your history and your company, what achievements

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Speaker 1: and accomplishments, because they are many, What you can just

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Speaker 1: describe to give people a little idea of your background. Sure,

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Speaker 1: we're in business now a little over forty nine years.

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Speaker 1: Our year will be in a few months as a

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Speaker 1: matter of fact, that we have the same partners we

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Speaker 1: started in nineteen nine. Next year we're going to celebrate

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Speaker 1: the fiftieth year. We're actually going to sign our agreement.

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Speaker 1: We never got around to signing it. Because we simply

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Speaker 1: couldn't afford the legal fee for an attorney to do it.

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Speaker 1: But we are all each other's lifetime friends, and I'm

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Speaker 1: very lucky to have this kind of relationship with five

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Speaker 1: other guys. UM to know what we do, we are

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Speaker 1: in the real estate business. Obviously, we are developers, builders,

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Speaker 1: owner operators. On the development side, my company was the

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Speaker 1: original owners and developers of the residential portion of Roosevelt

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Speaker 1: Dialect called Island House, and we owned it, we operated it. Uh.

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Speaker 1: We owned the Glen Oaks Village, which was three thousand

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Speaker 1: apartments and queens. We owned a number of properties around Manhattan,

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Speaker 1: the Park Vendome to seven Street, fifty Sutton Place South

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Speaker 1: for twift Street. UM and the numbers. He's got a list,

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Speaker 1: and it adds up to condiment apartments and rental and

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Speaker 1: rental apartments owned and managed. The largest condo owner and

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Speaker 1: operator at least in New York, if not in the

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Speaker 1: in the country. We finished now sixteen thousand and eight

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Speaker 1: departments through last year, which they tell me is about

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Speaker 1: three and a half times the next largest in the

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Speaker 1: New York area. So let's talk about the New York

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Speaker 1: area because we've seen cranes still up and bringing up

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Speaker 1: more buildings and more buildings. Uh. We were just talking

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Speaker 1: ahead of time about how the biggest problem for local

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Speaker 1: or residential real estate markets is overbuilding. Are we overbuilt

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Speaker 1: in New York? And what is the consequence if we are,

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Speaker 1: we're overbuilt to the price level that we're trying to

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Speaker 1: sell or rent to. Uh. New York now has a

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Speaker 1: reputation that's shared by Miami and Houston, Texas. The reputation is,

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Speaker 1: if you give a builder in New York a mortgage,

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Speaker 1: you will build in the desert. There's just no limit

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Speaker 1: to the amount that will be built as long as

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Speaker 1: they can borrow the money. You know, it's a funny

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Speaker 1: thing about borrowing money. It's tax free, and a lot

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Speaker 1: of the building that goes on throughout the country has

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Speaker 1: to do with something called the first draw. The first

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Speaker 1: draw is exactly what it seems to be. It is

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Speaker 1: the first amount you get from a lender. It is

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Speaker 1: tax free because it's alone, but it's also unaccountable. Because

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Speaker 1: it's unaccountable. Can you imagine all of the things you

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Speaker 1: can cover, all of the mistakes you can cover. And consequently,

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Speaker 1: the first draw forces builders to build more because they

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Speaker 1: can't cover the course of what they built previously. So

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Speaker 1: are we heading toward the crash here with respect to

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Speaker 1: the high ends, the mid to high ends condominium markets

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Speaker 1: or or or. I am convinced that UM, and a

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Speaker 1: reason that I've brought my people back to New York

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Speaker 1: because we work in a number of other states, UM,

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Speaker 1: is that we are going to see an implosion of

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Speaker 1: these ridiculously high priced condominiums that have no reason to

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Speaker 1: have been built in the first place. They weren't based on,

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Speaker 1: in my humble opinion, sound and reasonable thought. They were

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Speaker 1: based on hopes and dreams of being able to attract

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Speaker 1: folks from other countries who either had flight capital or

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Speaker 1: were simply trying to establish something for ego in the

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Speaker 1: United States. And I think you couldn't see from some

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Speaker 1: of the prices that have been paid fifty million, seventy

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Speaker 1: five hundred million dollars, what does that have to do

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Speaker 1: with the time of day? That's simply an outsized ego

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Speaker 1: trying to be self satisfied. You have written about something

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Speaker 1: described as sleight of hand and magic, and it's not

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Speaker 1: about Whodini tell us how slight of hand and magic

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Speaker 1: factor into real estate investment. Oh yes, it's some of

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Speaker 1: my favorite things. What I have found over the years

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Speaker 1: is that when I noticed funds buying portfolios of properties,

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Speaker 1: they were buying them for different reasons than what I

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Speaker 1: originally thought. I thought they were properly investing the money

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Speaker 1: and looking for a return. What I found was they

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Speaker 1: were looking for magic. What they would do is they

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Speaker 1: would buy a portfolio of maybe three, four, or five

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Speaker 1: or more properties, and the seller would agree to take

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Speaker 1: the funds in total as one number, without apportioning the

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Speaker 1: sale price to each property. So what was happening is

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Speaker 1: the buyer was now deciding on what the pro rata

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Speaker 1: share of purchase price would be of this total each

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Speaker 1: one of the properties. And when he did that, if

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Speaker 1: you think of it this way, it's really what happened.

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Speaker 1: He could take his best property he was buying and

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Speaker 1: put the lowest basis, and he could take the worst

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Speaker 1: property he was buying an increase that basis out of

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Speaker 1: all reasonable thought. And consequently, when he went to sell first,

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Speaker 1: his return on the on the best property became astronomical.

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Speaker 1: When he went to sell, he was selling at a

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Speaker 1: full spasis. Yeah, well, there are a lot of people

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Speaker 1: who are looking for magic, they might get something else.

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Speaker 1: Gerald Gotterman, thank you so much. That was fantastic. Gerald

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Speaker 1: Gotterman a senior principal partner at Government Partners, overseeing thousands

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Speaker 1: and thousands of apartments. We get to speak to one

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Speaker 1: of the fifty most powerful women in New York. She

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Speaker 1: is sitting with us, Leslie Himmel. She is co managing

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Speaker 1: partner of Himmel and Marrying Off Partners, private investor, private

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Speaker 1: ut landlord in in New York City and with more

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Speaker 1: than thirty years of experience. Leslie, thank you so much

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Speaker 1: for being with us. Where are we right now with

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Speaker 1: the New York commercial real estate market? We've heard a

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Speaker 1: lot about cooling off and pricing. How far is this

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Speaker 1: going to go? First of all, thank you for having

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Speaker 1: me on your show. Just to Contexas UM. Steve Marongolf

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Speaker 1: and I have been investors in Manhattan secondary office buildings

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Speaker 1: for the last thirty four years. We've been through many cycles.

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Speaker 1: We feel like we've been at a tipping point for

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Speaker 1: actually a few years, waiting for interest rates to start

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Speaker 1: to rise. I was just on a panel where there

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Speaker 1: was a reference on oak Tree saying that there's a

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Speaker 1: correlation to cap rates of about point eight to one.

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Speaker 1: As interest rates go up, so as interest rates rise,

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Speaker 1: pricing should come down. There's been way too much money

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Speaker 1: chasing goods here. Cap rates were at three and four

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Speaker 1: for a few years, three three and four percent, maybe

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Speaker 1: even negative yields. And you've seen the bid ask spread

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Speaker 1: changing a lot. So it feels like there's going to

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Speaker 1: be repricing. Although New York City is still the best

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Speaker 1: capital in the world and lots of international capital is

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Speaker 1: still coming here. I wonder if you could just take

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Speaker 1: a step back and tell us about Bernard Mendick and

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Speaker 1: what influence Bernie Mendick had on your career. Well, that's

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Speaker 1: a question I didn't expect. Bernie Mendick was the chair

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Speaker 1: of Redney and I knew him in my first real

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Speaker 1: estate board in New York. Yeah, yes, the real real

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Speaker 1: Estate Board of New York. And UM, I had been

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Speaker 1: integrated resources in my start after Harvard Business School, and

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Speaker 1: he told me I was going to be nothing unless

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Speaker 1: I started my own business. And and um that was

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Speaker 1: pretty brave. That was thirty five years ago for a

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Speaker 1: woman to try to start our own business as an

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Speaker 1: owner and developer, and um I did it. Was the

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Speaker 1: right advice. It was a great advice, and I've picked

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Speaker 1: a great partner. We've been partners thirty four years. He

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Speaker 1: made fun of me in a way because that was

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Speaker 1: Bernie's style, and um, he was a great influence and

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Speaker 1: I'm very grateful he passed away many years ago. But

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Speaker 1: he was a real entrepreneur and I've been able to

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Speaker 1: follow a little bit in his footsteps. You know. I

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Speaker 1: want to pick up on a point that you were

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Speaker 1: talking about with respect to foreign money coming into New York.

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Speaker 1: Have you seen that slow with possible capital restrictions from

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Speaker 1: China or just the slowing of the economy there. Canada

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Speaker 1: has increased they're investing in New York particularly was my

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Speaker 1: sub market that I focus on. Um, there's definitely been

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Speaker 1: a slowing down in Asian money, but there's still enormous

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Speaker 1: amount of capital coming here. UM also from Europe at

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Speaker 1: this point. So it's really just an interest rate story

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Speaker 1: from your perspective. The cooling it's there was interest rate

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Speaker 1: and also alternative investments as one can invest again in bonds.

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Speaker 1: You see, even like Black Rocky had three three billion

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Speaker 1: dollars go out from their stocks in the last quarter,

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Speaker 1: so you're seeing money flow from stocks into investing in

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Speaker 1: bond investments again, and and therefore, you know, real estate

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Speaker 1: we should catch up eventually with inflation. I think you

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Speaker 1: you'll still have a steady flow. We're not going We're

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Speaker 1: not going off a cliff this time. You've been quoted

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Speaker 1: as saying that Midtown Manhattan will look really different, but

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Speaker 1: it will take five years most likely ten. Tell us

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Speaker 1: how it will look different. Okay, but Lisa and I

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Speaker 1: were talking before the show about our strategy for thirty

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Speaker 1: or four years has been buying in emerging neighborhoods. We

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Speaker 1: bought in Harlem, we butt in uh Soho, we bought

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Speaker 1: No Hoo, we bought a Longan City almost thirty years ago.

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Speaker 1: Midtown East is the new emerging market, and it's so

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Speaker 1: out right now. Tenants are paying more to be like

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Speaker 1: Netflix paid hundred and twenty dollars a foot to be

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Speaker 1: on Little Broadway in eighteen Street. Nobody wants to be

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Speaker 1: in Midtown. The new zoning that we finally got after

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Speaker 1: eight years of fighting is going to help kickstart the

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Speaker 1: renovation and rebuilding of properties, and it's just going to reimagined.

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Speaker 1: It's going to take at least five, maybe ten years

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Speaker 1: for it to come back. It's still an epicenter of

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Speaker 1: New York. Are you buying right now in Midtown East

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Speaker 1: or are you sitting on the sidelines for a while.

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Speaker 1: We're waiting for pricing to get a little bit more realistic.

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Speaker 1: But we have a word chest of a few hundred

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Speaker 1: million dollars ready to pounce with institutional partners to back

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Speaker 1: us up. How much do prices have to come down

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Speaker 1: to get in? They just have There has to be

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Speaker 1: more volume on the market and I think about ten

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Speaker 1: percent maybe fifteen rebuilding the rebuilding of Park Avenue. Do

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Speaker 1: you see that calculus changing at all? Well, I think

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Speaker 1: Fisher Brothers had this fabulous contest where they had everything

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Speaker 1: being reimagined. Um, they're doing a great job in getting

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Speaker 1: creative and I think there'll be something happening in the

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Speaker 1: next five or ten years and it's necessary to make

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Speaker 1: it cool again. The recent announcement that JP Morgan is

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Speaker 1: going to tear down their building on Park Avenue build

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Speaker 1: a new bigger, better, brighter, taller, is that what's going

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Speaker 1: to happen. That's gonna be one example of many that

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Speaker 1: you're going to say they're the air rights transfer that

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Speaker 1: you can have from landmarks. That's happening in multiple buildings

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Speaker 1: right now. Is there any neighborhood in New York City

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Speaker 1: that you think could even see values appreciate going forward

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Speaker 1: in the next say two years, The boroughs really even

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Speaker 1: after Brooklyn already like well, the Opportunity Zone legislation is

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Speaker 1: going to bring a lot of money to the to

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Speaker 1: the Boroughs. All right, well done, Thank you very much

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Speaker 1: for being here and having us here at the Eisner

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Speaker 1: Amper Global Leaders in Real Estate a Summit, and want

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Speaker 1: to thank you very much Leslie Himmel, co, Managing partner

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Speaker 1: at Himmel Marong Golf Properties, telling us all about New

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Speaker 1: York real estate. Well done at congratulations, Thank you so

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Speaker 1: much for having me right now. I want to introduce

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Speaker 1: a very special guest. We are privileged to be able

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Speaker 1: to speak with Don People's, the chairman and chief executive

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Speaker 1: of the People's Corporation, long time experience in the markets,

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Speaker 1: a real good bird's eye view over what's going on.

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Speaker 1: So let's start there. We got more disappointing housing data today.

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Speaker 1: Where are we in the housing cycle? From your perspective, um,

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Speaker 1: I think that we are in a more in the

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Speaker 1: bottom half bottom of the cycle. Right now, I think

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Speaker 1: that the markets catching his breath. I mean everything's healthy.

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Speaker 1: I mean job growth, employment, everything's very healthy. I mean

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Speaker 1: cost have um had a big impact on affordability, and

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Speaker 1: so fewer people are able to buy right now because

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Speaker 1: not because of income issues, but because of the rising

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Speaker 1: and run up and cost and so the markets now

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Speaker 1: got to find its way back down. I mean developers,

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Speaker 1: you know, my company included, we were extremely optimistic that

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Speaker 1: this big run um of price increases would continue. And

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Speaker 1: it's it's not, and it shouldn't have. I mean what

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Speaker 1: happened is that we had the Great Recession. Development came

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Speaker 1: to a screeching halt up until say two thousand, late

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Speaker 1: two thousand, two thousand twelve, and there was huge pent

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Speaker 1: up demand. Well, the market has now satisfied that pent

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Speaker 1: up demand and now we're back on a more equilibrium level.

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Speaker 1: So we can't have these big run ups on prices

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Speaker 1: I mean cast of materials and cost of run up

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Speaker 1: significantly because of this big rush to develop. So now

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Speaker 1: things gonna settle down a little bit, and I think

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Speaker 1: we'll see a much more healthy market, barring some catastrophic event.

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Speaker 1: The market is gonna level off. There'll be a normal

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Speaker 1: growth as opposed to this extreme volatility UM in the

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Speaker 1: in the real estate market. Just to step back for

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Speaker 1: a moment, Uh, you left Rutgers pre med to go

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Speaker 1: into real estate. Yeah, you did a major development in

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Speaker 1: d C that was successful. Then something happened. You decided

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Speaker 1: to go You want to go to Miami. Now you're

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Speaker 1: based in Coral Gables. You've got properties all over the

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Speaker 1: United States. But your tagline of the company is affirmative Development,

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Speaker 1: and that's not by coincidence. Can you tell us about that? Well?

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Speaker 1: Thank you, m'm and PIM. We like, you know, as

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Speaker 1: a company, we like geographic and product type diversification. So

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Speaker 1: I like to um do go into other markets, urban

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Speaker 1: gateway markets with big barriers to entry. UM. But you know,

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Speaker 1: I quit Rutgers to go work in real estate. And

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Speaker 1: I was exposed to real estate by my mother. UM.

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Speaker 1: My mother raised me and my parents were divorced when

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Speaker 1: I was five, So she was a breadwinner in our household,

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Speaker 1: and she was knocking down you know, um and confronting

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Speaker 1: barriers throughout her career. Uh. And so I wanted to

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Speaker 1: create an environment in my company that recognizes that we

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Speaker 1: need to make this a more level playing field. And

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Speaker 1: so how to do that is to make sure by

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Speaker 1: my company that we provide access to equal opportunities for

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Speaker 1: minority and women entrepreneurs. So as a whole, throughout our

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Speaker 1: company UM, we since the history of our company, twenty

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Speaker 1: five over of all of our contracts for our projects

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Speaker 1: have gone to minority and women owned businesses. I mean,

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Speaker 1: so think about this New York City six or seven

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Speaker 1: percent minority and as we stand today and as fifty

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Speaker 1: three percent female, and if we stand today, the city

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Speaker 1: does less than three percent of its contract with minority

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Speaker 1: and women own businesses. So I'm very proud of that.

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Speaker 1: And so that's a big part of what our company

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Speaker 1: UM does is we create environments of our opportunity. We

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Speaker 1: are a capitalistic democracy. A capitalistic democracy means that businesses lead,

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Speaker 1: entrepreneurs innovate and lead. And so we cannot advocate this

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Speaker 1: responsibility of a of a of inclusiveness UM to the

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Speaker 1: public sector, and the private sector has a key role

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Speaker 1: to do that. Larry Thinks set that in his annual

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Speaker 1: letter to shareholders that UM, you know, black Rock has

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Speaker 1: to do more than just make profits, but invest UM

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Speaker 1: in an impact investing and I think big part of

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Speaker 1: that is that, you know, opportunities ought to be reflective

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Speaker 1: of the demographics of our society and they're not, and

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Speaker 1: especially in the business sector, and so businesses have to

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Speaker 1: accept that responsibility. And so that's what why we do

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Speaker 1: what we do. Businesses lead so to politicians, and the

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Speaker 1: Washington Post reported that you're considering running for New York

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Speaker 1: City mayor. Is that still in the carts? Yeah, I mean, look,

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Speaker 1: I'm considering it, UM. I did before. UM. I don't

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Speaker 1: have a personal ambition UH to be in politics or

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Speaker 1: personal ambition to be a mayor of New York City.

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Speaker 1: I never have had that kind of personal ambition, but

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Speaker 1: I do UM have a personal commitment to UM balancing

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Speaker 1: a system that you know makes our country great and

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Speaker 1: entrepreneurship and business is what makes America a great nation

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Speaker 1: amongst its people, and so we have a responsibility as

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Speaker 1: a business UM to do that. So I'm interested in

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Speaker 1: that regard. I'm curious as a business owner, do you

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Speaker 1: think that the policy is currently in place at a

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Speaker 1: national level are very supportive of business? Yes, but they

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Speaker 1: create UM unfortunately, how how they're being presented unfortunately, UM

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Speaker 1: are creating a great deal of divisiveness. And yeah, I

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Speaker 1: think less regulations good for entrepreneurship. I think, uh you know, um,

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Speaker 1: more free flowing capital is good for entrepreneurship. I mean,

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Speaker 1: but there are I mean, there's a there's an their

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Speaker 1: institutions also that are very important for our country as well,

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Speaker 1: such as I mean the Federal Reserve. I mean that

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Speaker 1: should be immune from politics. UM. So so it's a

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Speaker 1: double edged store. Well, just to to amplify that, I mean,

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Speaker 1: you are a congressional page, so you've seen it from

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Speaker 1: the inside, and now you see it from the other

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Speaker 1: side as well. Yes. In fact, I was a page

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Speaker 1: my last and an intern um my last few years

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Speaker 1: of high school. And so I have um watched UM

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Speaker 1: multiple presidents, every president since Carter. I've actually met them,

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Speaker 1: and I've seen them in action. And I've been a

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Speaker 1: student of politics and and the ability to be transfer

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Speaker 1: of politics be transformative, and also how the nation has

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Speaker 1: changed and evolved. Civil rights movement happened in my lifetime, UM,

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Speaker 1: Women's rights, Um, you know, happened in my lifetime early

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Speaker 1: in my early in my adult life. UM. And so

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Speaker 1: I've seen a lot happen. So in twenty seconds, are

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Speaker 1: there any areas in the United States that you think

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Speaker 1: still could see price gains? You see US opportunities? Yes,

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Speaker 1: I think Los Angeles is gonna see price gains. I

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Speaker 1: think uh, Charlotte UM is gonna see price games. Miami

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Speaker 1: and South Florida as a whole is gonna get another run,

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Speaker 1: and Central Florida is gonna get another run. Those will

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Speaker 1: be in in Tennessee. UM. Those are where people are

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Speaker 1: moving to in businesses are moving to UM for different reasons,

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Speaker 1: mainly for taxes, and so we'll see some more growth

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Speaker 1: in those markets. And of course you'll announce whether you're

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Speaker 1: gonna run from mayor with us, right, I mean, if

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Speaker 1: you decide to do that, if I decided to do that,

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Speaker 1: I would certainly do that. All right, well done, Thanks

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Speaker 1: very much for being with us. Don Peebles he is

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Speaker 1: the chairman and the chief executive of the People's Corporation.

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Speaker 1: They are based in Coral Gables, Florida. Joining us now

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Speaker 1: that way, we have Jim Bianco. He is the president

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Speaker 1: and founder of Bianco Research. He is also a Bloomberg

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Speaker 1: Opinion columnist. Jim Bianco, let's begin with President Donald Trump

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Speaker 1: and his attack on j Pal chairman of the Federal Reserve.

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Speaker 1: Your reaction, I don't have a problem with it. I

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Speaker 1: know a lot of people do the Federal Reserve. I

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Speaker 1: kind of put in this kind of a parallel with

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Speaker 1: the Supreme Court. We always criticize the Supreme Court. Yes,

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Speaker 1: the President could remove a Federal Reserve chairman for cause,

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Speaker 1: but the hurdle is very, very high, and Trump has

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Speaker 1: said to the point so far that he doesn't want

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Speaker 1: to do that. But there's nothing wrong with the President

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Speaker 1: of the United Space expressing his opinion about monetary policy

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Speaker 1: in making the Federal Reserve explain themselves. If they believe

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Speaker 1: his criticism of monetary policy will affect it, then we

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Speaker 1: should frankly look for new Federal Reserve personnel that are

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Speaker 1: able to stomach somebody questioning what they're due. They are

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Speaker 1: not allowed to live in an ivy tower without criticism.

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Speaker 1: And there's nothing wrong with what the President is doing. Now,

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Speaker 1: maybe the words he's chosen, I would have chosen different words,

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Speaker 1: but I don't have a problem with with what he's

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Speaker 1: attempting to do here. Do you think that he's right?

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Speaker 1: Do you think that the Federal Reserve is raising rates

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Speaker 1: too quickly. I do think he's right, and I do

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Speaker 1: think the Federal Reserve is raising races too quickly. But

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Speaker 1: I also would have said, even if I didn't believe

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Speaker 1: that it was okay for him to uh to do this.

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Speaker 1: And I do think that the Federal Reserve should be asked,

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Speaker 1: as J. Paul was in the first question of his

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Speaker 1: press conference in September two, only six the history of

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Speaker 1: the Federal Reserve is you raise rates too much, something breaks,

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Speaker 1: and then it's too late, we have a recession. There

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Speaker 1: is the leading cause of recessions over the last time

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Speaker 1: of years. Hold on a second, Jim, there is a

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Speaker 1: whole school of thought that at a certain point keeping

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Speaker 1: rates too low is harmful for the economy. That if

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Speaker 1: you raise rates and actually people can earn some money

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Speaker 1: on their cash, they can actually use it to go

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Speaker 1: out and spend and it actually boosts growth. What do

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Speaker 1: you say to that. I absolutely agree with that that

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Speaker 1: monetary policy in the extreme either way creates dislocations in

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Speaker 1: the economy. Too low can create problems, too high can

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Speaker 1: create problems. The question is whether or not they're going

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Speaker 1: too high. One of the leading indicators that says the

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Speaker 1: FETs move too much is an inverted deal curve. We

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Speaker 1: don't have that now, but we are on our way

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Speaker 1: towards one. Especially if the FETE intends on raising rates

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Speaker 1: four more times between now in the end of next year,

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Speaker 1: we could very well be at an inverted deal curve.

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Speaker 1: And when the FETE is asked about this, they dismissed

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Speaker 1: the yel curve. We've done that every cycle. They dismissed it,

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Speaker 1: and it always turns out to be a good indicator.

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Speaker 1: And um, when asked, yeah, just back to my thing.

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Speaker 1: When I asked that, the first question of the presser

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Speaker 1: in September, uh, are you gonna go till something breaks?

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Speaker 1: How uncharacteristically did not have any answer for that. He

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Speaker 1: just basically said, you know, we're smart people and hopefully

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Speaker 1: we'll figure it out before we get there. They don't

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Speaker 1: know where the breaking point is. So that's why I

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Speaker 1: think it's fair to ask those questions. This is dangerous stuff.

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Speaker 1: When you raise rates eight times, planner raising rates four

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Speaker 1: more times. History has shown you cause problems when you

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Speaker 1: do this. That's your history, and there's got to be

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Speaker 1: a better answer than hopefully we won't create another problem

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Speaker 1: again this time we'll see. That seems to be what

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Speaker 1: they said. They're saying right now, Jim Bianco. If you

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Speaker 1: happen to be an investor that is long stocks, what's

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Speaker 1: the best hedge against the market sell off? If you

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Speaker 1: don't want to sell them. Um, that's a good question

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Speaker 1: because what's happening in the marketplace now, excuse me, is

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Speaker 1: that the relationships between stocks and bonds and all the

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Speaker 1: other assets is becoming very correlated, meaning they all move

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Speaker 1: up and down together. Meaning if you want to look,

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Speaker 1: what do I do with my money if the stock

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Speaker 1: market is not working, the answer is there's not much

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Speaker 1: you can do except for cash. If you want to

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Speaker 1: move to cash, that's always a safe instrument to put

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Speaker 1: your money in your you you earn two percent because

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Speaker 1: that's about where cash is, but you don't take any

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Speaker 1: downside risk. If the question then is why anything but cash,

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Speaker 1: the answer is there is no option. That has been

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Speaker 1: the biggest problem with the market this year is the

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Speaker 1: recorrelation of all of these markets together. Your cover story

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Speaker 1: in Bloomberg magazine about what's happening at a q R

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Speaker 1: and the problems they're having is a direct result of this.

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Speaker 1: Is that all of these markets are becoming very correlated,

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Speaker 1: and it's been a very difficult problem a lot of people.

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Speaker 1: Jim Bianco, we love having you on. Thank you so

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Speaker 1: much for being with us. Jim Bianco is president and

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Speaker 1: founder of Bianco Research Research, as well as a Bloomberg

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Speaker 1: opinion columnist. Thanks for listening to the Bloomberg P and

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Speaker 1: L podcast. You can subscribe and listen to interviews at

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Speaker 1: Apple Podcasts, SoundCloud, or whatever podcast platform you prefer. I'm

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Speaker 1: Pim Fox. I'm on Twitter at pim Fox. I'm on

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Speaker 1: Twitter at Lisa Abramo. It's one before the podcast. You

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Speaker 1: can always catch us worldwide on Bloomberg Radio