1 00:00:02,520 --> 00:00:13,760 Speaker 1: Bloomberg Audio Studios, podcasts, radio news. This is the Bloomberg 2 00:00:13,840 --> 00:00:17,920 Speaker 1: Surveillance Podcast. Catch us live weekdays at seven am Eastern 3 00:00:18,200 --> 00:00:21,240 Speaker 1: on Apple car Play or Android Auto with the Bloomberg 4 00:00:21,320 --> 00:00:24,880 Speaker 1: Business app. Listen on demand wherever you get your podcasts, 5 00:00:25,280 --> 00:00:27,800 Speaker 1: or watch us live on YouTube severity. 6 00:00:27,880 --> 00:00:31,160 Speaker 2: Roth walks in and it's really wicked cold in your folks, 7 00:00:31,160 --> 00:00:32,040 Speaker 2: I like it that way. 8 00:00:32,280 --> 00:00:34,199 Speaker 3: And the whole room heats up because she's working the 9 00:00:34,280 --> 00:00:37,360 Speaker 3: terminal short like nothing. What do you see over there 10 00:00:37,400 --> 00:00:41,320 Speaker 3: in the terminal, Stephanie Roth, Oh, this inflation report? 11 00:00:41,400 --> 00:00:41,920 Speaker 2: This shock? 12 00:00:43,000 --> 00:00:45,760 Speaker 4: I certainly, it certainly is a shock. I think the 13 00:00:45,760 --> 00:00:47,720 Speaker 4: main thing that we have to remember is there is 14 00:00:47,800 --> 00:00:49,800 Speaker 4: a lot of error in this report, so I would 15 00:00:49,800 --> 00:00:52,240 Speaker 4: not take much away from this. A key thing that 16 00:00:51,960 --> 00:00:54,600 Speaker 4: there's an issue with in the sense that when they're 17 00:00:54,640 --> 00:00:59,120 Speaker 4: sampling the data specifically around November, that the survey period 18 00:00:59,200 --> 00:01:01,640 Speaker 4: was condensed until later in the month when you typically 19 00:01:01,680 --> 00:01:05,200 Speaker 4: have significant holiday discounting. And when we spoke with BLS, 20 00:01:05,200 --> 00:01:07,440 Speaker 4: they said they're not doing anything to adjust those seasonals, 21 00:01:07,840 --> 00:01:11,680 Speaker 4: so that automatically makes the data artificially weak and we're 22 00:01:11,720 --> 00:01:13,360 Speaker 4: probably going to see a bounce back in December. 23 00:01:13,840 --> 00:01:16,399 Speaker 5: Is there a trend we can take away from here that, boy, 24 00:01:16,440 --> 00:01:19,760 Speaker 5: it's at least inflation is not going up from here. 25 00:01:19,800 --> 00:01:22,360 Speaker 6: Is that a fair takeaway? Maybe it's not cooling as much. 26 00:01:22,240 --> 00:01:25,000 Speaker 5: As these numbers might suggest, but it doesn't appear to 27 00:01:25,040 --> 00:01:25,479 Speaker 5: be rising. 28 00:01:25,680 --> 00:01:26,800 Speaker 6: I think that's entirely fair. 29 00:01:26,880 --> 00:01:27,160 Speaker 2: Okay. 30 00:01:27,480 --> 00:01:31,000 Speaker 4: There was this concern that around the holiday season companies 31 00:01:31,040 --> 00:01:33,840 Speaker 4: wouldn't really do the typical discounting that they usually do 32 00:01:33,920 --> 00:01:36,440 Speaker 4: because of the tariffs. That doesn't appear to be the case, 33 00:01:36,680 --> 00:01:38,960 Speaker 4: and we knew this heading into the data print because 34 00:01:39,000 --> 00:01:41,520 Speaker 4: if you looked at a number of different indicators that 35 00:01:41,560 --> 00:01:44,280 Speaker 4: survey the company is ahead of the holiday season, it 36 00:01:44,319 --> 00:01:48,280 Speaker 4: showed a normal holiday discounting year. So it doesn't appear 37 00:01:48,320 --> 00:01:52,560 Speaker 4: like there was this lapse in discounting just because of tariffs. 38 00:01:52,560 --> 00:01:56,680 Speaker 4: In fact, it was a typical year for discounting. And 39 00:01:56,720 --> 00:01:58,360 Speaker 4: then on top of that, you have some of the 40 00:01:58,880 --> 00:02:00,920 Speaker 4: issues within the data because of the government shutdown. 41 00:02:01,200 --> 00:02:04,240 Speaker 3: So Myron's been out here, Governor Myron, We've got a 42 00:02:04,280 --> 00:02:06,840 Speaker 3: lower rates, a whole bunch of other people. There's been 43 00:02:06,840 --> 00:02:10,560 Speaker 3: a clear tendency within Bloomberg's surveillance of people looking at 44 00:02:10,560 --> 00:02:14,840 Speaker 3: a disinflationary tendency. Is it a January tendency or is 45 00:02:14,840 --> 00:02:17,480 Speaker 3: it a FED meeting waiting out mid summer. 46 00:02:18,880 --> 00:02:21,880 Speaker 4: Yeah, I mean so I think I think what we'll 47 00:02:21,919 --> 00:02:24,400 Speaker 4: see is inflation will bounce back in the next couple 48 00:02:24,400 --> 00:02:27,400 Speaker 4: of prints, the economy will start to pick up again, 49 00:02:27,440 --> 00:02:29,680 Speaker 4: in which case the Fed's probably going to be on 50 00:02:29,720 --> 00:02:31,519 Speaker 4: hold for much of the beginning. 51 00:02:31,200 --> 00:02:31,760 Speaker 6: Of next year. 52 00:02:33,000 --> 00:02:35,320 Speaker 5: So again, so the Fed, I mean if you look 53 00:02:35,320 --> 00:02:36,800 Speaker 5: at so you don't think the Fed's going to look 54 00:02:36,800 --> 00:02:39,959 Speaker 5: at these numbers and say we've got inflation. I sure, 55 00:02:39,960 --> 00:02:42,760 Speaker 5: hope not sure, because you think that data in the 56 00:02:42,800 --> 00:02:44,520 Speaker 5: next couple of months could in fact show a little 57 00:02:44,520 --> 00:02:46,320 Speaker 5: bit more inflation in the economy. 58 00:02:47,040 --> 00:02:50,400 Speaker 6: Yeah, And we know that there was a there was 59 00:02:50,440 --> 00:02:50,960 Speaker 6: an issue. 60 00:02:51,000 --> 00:02:53,640 Speaker 4: I mean, it didn't even collect in the October CPI 61 00:02:53,720 --> 00:02:54,960 Speaker 4: for the most part, we know that there are issues 62 00:02:54,960 --> 00:02:59,120 Speaker 4: with the data. So to form a strong conclusion about 63 00:02:59,240 --> 00:03:03,000 Speaker 4: this print up two as being some massive disinflationary period, 64 00:03:03,040 --> 00:03:05,280 Speaker 4: I think is entirely inaccurate. 65 00:03:05,480 --> 00:03:06,480 Speaker 2: Stephanie Roth through this. 66 00:03:06,560 --> 00:03:09,000 Speaker 3: With a Wolf Research and we continue here Paul Sweeney 67 00:03:09,040 --> 00:03:12,000 Speaker 3: and Tom Keane with Lisa Matteo and John Tuckler. Good 68 00:03:12,040 --> 00:03:15,639 Speaker 3: Morning Across the Nation series XM Channel one twenty one, 69 00:03:15,639 --> 00:03:18,600 Speaker 3: Good Morning Canada. I mentioned David Rosenberg up in Toronto 70 00:03:18,960 --> 00:03:20,400 Speaker 3: with a disinflationary call. 71 00:03:20,720 --> 00:03:23,959 Speaker 2: Nailed that into this report on YouTube. 72 00:03:24,000 --> 00:03:28,200 Speaker 3: Subscribed to Bloomberg Podcasts, We're thrilled to finish twenty twenty 73 00:03:28,240 --> 00:03:31,600 Speaker 3: five strong, humbled by the sign ups there each and 74 00:03:31,680 --> 00:03:35,800 Speaker 3: every day at Bloomberg podcast Paul Sweeney was Stephanie rough. 75 00:03:35,600 --> 00:03:38,640 Speaker 5: All right, so we've got an inflation environment that's at 76 00:03:38,720 --> 00:03:40,120 Speaker 5: least okay at this point. 77 00:03:40,200 --> 00:03:41,160 Speaker 7: How about the labor market. 78 00:03:41,200 --> 00:03:42,120 Speaker 6: What did you take away. 79 00:03:41,920 --> 00:03:43,720 Speaker 5: From some of the labor data earlier. 80 00:03:44,720 --> 00:03:46,240 Speaker 4: Yeah, I mean so, I think what we're seeing is 81 00:03:46,360 --> 00:03:48,520 Speaker 4: a live market that's holding up a lot better and 82 00:03:48,560 --> 00:03:51,720 Speaker 4: in fact starting to inflect a bit higher from here. 83 00:03:51,960 --> 00:03:53,840 Speaker 4: And I think that's the main conclusion that we should 84 00:03:53,840 --> 00:03:59,920 Speaker 4: take away from the headline jobs numbers. Let me replace 85 00:04:00,040 --> 00:04:02,480 Speaker 4: the private payrolls numbers. The headline jobs numbers are impacted 86 00:04:02,520 --> 00:04:05,960 Speaker 4: again by not necessarily the government shut down in particular, 87 00:04:06,000 --> 00:04:09,680 Speaker 4: but the the third resignation program which ended into at 88 00:04:09,720 --> 00:04:12,440 Speaker 4: the end of September. These are people who took severance package. 89 00:04:12,440 --> 00:04:14,080 Speaker 4: This is not people who lost their jobs. So if 90 00:04:14,080 --> 00:04:16,039 Speaker 4: you look at the private payroll numbers, they were actually 91 00:04:16,080 --> 00:04:18,480 Speaker 4: quite decent. Now we're looking at, you know, a trend 92 00:04:18,520 --> 00:04:20,919 Speaker 4: that's close to in the seventy thousand range, which is 93 00:04:20,960 --> 00:04:24,600 Speaker 4: really not bad so and the effect the unemployment rate 94 00:04:24,680 --> 00:04:28,400 Speaker 4: rose is less of a less of a concern, I 95 00:04:28,440 --> 00:04:31,240 Speaker 4: think partially because there was again some issues with the 96 00:04:31,720 --> 00:04:35,600 Speaker 4: government shut down impacting the data, and then in today's 97 00:04:35,600 --> 00:04:39,479 Speaker 4: inflation data, the airlines were a big driver of the 98 00:04:39,480 --> 00:04:41,400 Speaker 4: weakness and that there was also canceled flights. 99 00:04:41,400 --> 00:04:44,640 Speaker 6: There was just a lot going on in your first. 100 00:04:44,360 --> 00:04:46,120 Speaker 2: Look at the noises the airlines. 101 00:04:46,320 --> 00:04:48,760 Speaker 4: First look at the noises the airlines. They fell six 102 00:04:48,800 --> 00:04:50,840 Speaker 4: point five percent over two months, so it comes out 103 00:04:50,839 --> 00:04:54,560 Speaker 4: to about three percent each month. If you look at 104 00:04:54,600 --> 00:04:57,279 Speaker 4: the you know, the core number was point one five 105 00:04:57,440 --> 00:05:01,320 Speaker 4: nine across both months. That's you know, quite low. What 106 00:05:01,400 --> 00:05:05,240 Speaker 4: peril was was pretty weak. That is probably tied to 107 00:05:05,279 --> 00:05:08,840 Speaker 4: this whole holiday discounting issue. So there's a lot of 108 00:05:09,200 --> 00:05:11,960 Speaker 4: sort of noise within within the report, and part tied 109 00:05:12,000 --> 00:05:13,400 Speaker 4: to the government shut down in port tied to the 110 00:05:13,400 --> 00:05:16,880 Speaker 4: fact that it's just a sort of less inflationary backdrop. 111 00:05:17,440 --> 00:05:19,840 Speaker 3: North Fries of market higher features of forty now out 112 00:05:19,880 --> 00:05:22,960 Speaker 3: of forty seven nansdeck up one point three half percent. 113 00:05:23,040 --> 00:05:26,320 Speaker 3: The nansdack one hundred, I should say vict sixteen point 114 00:05:26,400 --> 00:05:29,000 Speaker 3: eight three. You know, I look at this stuff, I 115 00:05:29,040 --> 00:05:32,640 Speaker 3: look at the whole ballet of it all, and I 116 00:05:33,120 --> 00:05:36,720 Speaker 3: am more than certain. I learned this from David Rosenberg 117 00:05:36,760 --> 00:05:41,479 Speaker 3: at Merrill years ago, Merrill, Lynch, Pierce, Fenner, and Smith. 118 00:05:41,760 --> 00:05:43,800 Speaker 2: I saw an article that is just Meryl. I said, 119 00:05:44,000 --> 00:05:45,480 Speaker 2: it will never just be maryl. 120 00:05:46,360 --> 00:05:49,320 Speaker 3: You just mentioned that the pros like you look at 121 00:05:49,360 --> 00:05:53,880 Speaker 3: each line item. What did the service sector line items say? 122 00:05:54,279 --> 00:05:57,440 Speaker 3: And the angst of a four to be in purchasing. 123 00:05:57,040 --> 00:06:04,000 Speaker 2: Power, utility bills, bills, the auto insurance. Can you see 124 00:06:04,000 --> 00:06:05,120 Speaker 2: those in the report? 125 00:06:05,279 --> 00:06:07,800 Speaker 4: Yeah, we can see that in the report. Motor vehicle 126 00:06:07,880 --> 00:06:12,000 Speaker 4: insurance looks pretty flat. Transportation services, lodging, all that stuff 127 00:06:12,040 --> 00:06:15,800 Speaker 4: was pretty soft. It's hard to know to what extent 128 00:06:15,839 --> 00:06:18,880 Speaker 4: this is government shutdown related. My senses it probably is, 129 00:06:18,880 --> 00:06:21,680 Speaker 4: and we'll see a bit of a bounce back. And 130 00:06:21,720 --> 00:06:24,279 Speaker 4: then on the good side, that was all pretty soft, 131 00:06:24,279 --> 00:06:25,839 Speaker 4: outside of maybe some used. 132 00:06:25,760 --> 00:06:27,480 Speaker 2: Vehicles fed pick. 133 00:06:28,160 --> 00:06:30,360 Speaker 6: What do you think who should it be or who 134 00:06:30,400 --> 00:06:31,080 Speaker 6: do I think it will be? 135 00:06:32,000 --> 00:06:33,880 Speaker 2: Book? We have time for both answers. 136 00:06:34,680 --> 00:06:35,680 Speaker 6: I would love to see Waller. 137 00:06:35,720 --> 00:06:36,960 Speaker 4: I think he'd be a great pick, and I think 138 00:06:37,120 --> 00:06:39,760 Speaker 4: markets would really prefer to see Waller, who I. 139 00:06:39,720 --> 00:06:40,360 Speaker 7: Think is more likely. 140 00:06:40,400 --> 00:06:42,160 Speaker 4: It's probably more likely to be Hassett, although it does 141 00:06:42,200 --> 00:06:45,440 Speaker 4: seem like incrementally over the past couple of weeks there 142 00:06:45,440 --> 00:06:48,479 Speaker 4: seems to be some more concerns about Hasset, or at 143 00:06:48,560 --> 00:06:51,560 Speaker 4: least more hesitation out of the White House for picking him. 144 00:06:51,680 --> 00:06:53,880 Speaker 2: Stephanie Roth, thank you so much for joining us. 145 00:06:53,920 --> 00:06:56,800 Speaker 3: Your commitment to surveillances appreciated of course, with the FED 146 00:06:57,000 --> 00:06:59,560 Speaker 3: sides and other great moments. 147 00:06:59,560 --> 00:07:00,320 Speaker 2: Stay with us. 148 00:07:00,560 --> 00:07:03,760 Speaker 8: More from Bloomberg Surveillance coming up after this. 149 00:07:11,040 --> 00:07:14,600 Speaker 1: You're listening to the Bloomberg Surveillance podcast. Catch us live 150 00:07:14,680 --> 00:07:17,840 Speaker 1: weekday afternoons from seven to ten am Eastern Listen on 151 00:07:17,920 --> 00:07:21,600 Speaker 1: Applecarplay and Android Otto with the Bloomberg Business app, or 152 00:07:21,720 --> 00:07:23,160 Speaker 1: watch us live on YouTube. 153 00:07:23,320 --> 00:07:24,800 Speaker 2: We're gonna go to Emily Rowland right now. 154 00:07:24,840 --> 00:07:27,400 Speaker 3: She is a Johnny anecock and I just can't say 155 00:07:27,520 --> 00:07:31,120 Speaker 3: enough Howard manual life. She has just said you have 156 00:07:31,200 --> 00:07:35,280 Speaker 3: to participate. First of all, congratulations. 157 00:07:34,200 --> 00:07:37,920 Speaker 2: On the last three, four, five years. You've just absolutely 158 00:07:38,120 --> 00:07:43,960 Speaker 2: killed the common sense nature of just own quality stocks. 159 00:07:44,280 --> 00:07:45,720 Speaker 2: Any variants for next. 160 00:07:45,600 --> 00:07:49,280 Speaker 9: Year, No, Tom, I mean we have long recognized the 161 00:07:49,320 --> 00:07:52,480 Speaker 9: fact that over time, stock prices follow profits. 162 00:07:52,520 --> 00:07:53,520 Speaker 7: It's pretty simple. 163 00:07:54,240 --> 00:07:56,960 Speaker 9: The challenge, of course this year is quality has honestly 164 00:07:57,000 --> 00:07:58,040 Speaker 9: been left in the dust. 165 00:07:58,200 --> 00:08:00,000 Speaker 7: This year has been all about momentum. 166 00:08:00,160 --> 00:08:02,640 Speaker 9: It's been about technicals, it's been about finding a chart 167 00:08:02,720 --> 00:08:04,360 Speaker 9: that's going on, checking out. 168 00:08:04,440 --> 00:08:07,480 Speaker 2: What does it signal to you that they've been left behind. 169 00:08:07,840 --> 00:08:10,400 Speaker 9: Well, it just signals that there just has been a 170 00:08:10,600 --> 00:08:15,480 Speaker 9: sentiment driven market, whether it's political sentiment, whether it's sell 171 00:08:15,600 --> 00:08:18,840 Speaker 9: US dollars and buy everything else, whether it's embrace Europe. 172 00:08:18,880 --> 00:08:21,720 Speaker 9: I mean, look at things like Spain and the cosby 173 00:08:21,920 --> 00:08:25,680 Speaker 9: this year. They're both up eighty percent. They are trading 174 00:08:25,720 --> 00:08:28,600 Speaker 9: not like companies but almost like ticker symbols. So we've 175 00:08:28,640 --> 00:08:32,120 Speaker 9: seen investors really be driven by sentiment. We've been getting 176 00:08:32,120 --> 00:08:36,160 Speaker 9: out our old technical investing textbooks from years ago to 177 00:08:36,240 --> 00:08:38,160 Speaker 9: try to figure out what's going on. But I think 178 00:08:38,160 --> 00:08:40,280 Speaker 9: there could be a bid for quality as we head 179 00:08:40,280 --> 00:08:42,319 Speaker 9: into a trickier year in twenty twenty six. 180 00:08:42,679 --> 00:08:46,360 Speaker 5: Some concerns out there about a bubble around this whole 181 00:08:46,400 --> 00:08:49,679 Speaker 5: AI story broadly defined and maybe just not in those 182 00:08:49,679 --> 00:08:51,559 Speaker 5: seven names, but maybe more broadly in the market. 183 00:08:51,640 --> 00:08:52,400 Speaker 6: How do you think about that? 184 00:08:52,600 --> 00:08:54,040 Speaker 7: Yeah, I mean, there's no doubt about it. 185 00:08:54,120 --> 00:08:56,880 Speaker 9: The valuations are elevated around twenty two and a half 186 00:08:56,920 --> 00:08:58,000 Speaker 9: times forward earnings. 187 00:08:58,000 --> 00:08:59,079 Speaker 7: Of course, the peak. 188 00:08:58,920 --> 00:09:02,200 Speaker 9: Historically was twenty five or But what we're really focused 189 00:09:02,240 --> 00:09:06,880 Speaker 9: on is the denominator of the pe ratio, it's earnings. 190 00:09:06,920 --> 00:09:09,720 Speaker 9: And the earnings engine in the United States is on. 191 00:09:10,600 --> 00:09:12,280 Speaker 9: We have a lot of tailwinds in the next year. 192 00:09:12,320 --> 00:09:14,560 Speaker 9: We've got the provisions from the one big beautiful Bill. 193 00:09:14,600 --> 00:09:19,079 Speaker 9: We've got energy prices close to support here that helps consumers. 194 00:09:19,120 --> 00:09:21,120 Speaker 9: So there's a lot going right for corporate America. 195 00:09:21,200 --> 00:09:24,560 Speaker 2: Okay, inflation comes at lower Yeah, and you're on Trush 196 00:09:24,640 --> 00:09:24,920 Speaker 2: came in. 197 00:09:24,960 --> 00:09:26,640 Speaker 3: I don't know if you saw the report, but you know, 198 00:09:27,080 --> 00:09:29,440 Speaker 3: way under three percent. Yeah, let's say we get a 199 00:09:29,440 --> 00:09:32,240 Speaker 3: FED cut this time whenever, maybe when the red sox 200 00:09:32,480 --> 00:09:36,920 Speaker 3: finally enter the free agent market whatever, I'm sorry. Money 201 00:09:36,920 --> 00:09:40,000 Speaker 3: market funds, Paul, at what three point six percent? Yeah, 202 00:09:40,040 --> 00:09:42,400 Speaker 3: they're going to be three point five percent? What does 203 00:09:42,440 --> 00:09:46,920 Speaker 3: the John Hancock Manual Life Research of the emotion of 204 00:09:47,000 --> 00:09:48,720 Speaker 3: money market funds coming down? 205 00:09:48,800 --> 00:09:50,920 Speaker 7: There is a love affair with money markets. 206 00:09:50,960 --> 00:09:54,679 Speaker 9: There are seven plus trillion dollars sitting in cash right now, 207 00:09:54,679 --> 00:09:57,560 Speaker 9: and we think that those yields could disappear before your 208 00:09:57,559 --> 00:10:00,640 Speaker 9: eyes into next year. The bond mark mart is just 209 00:10:00,840 --> 00:10:04,840 Speaker 9: not sniffing out the disinflation that we see coming from 210 00:10:04,840 --> 00:10:07,920 Speaker 9: the housing market. Just this morning, looking at the CPI report, 211 00:10:07,960 --> 00:10:10,080 Speaker 9: it was still like groundhog Day. It was like the 212 00:10:10,080 --> 00:10:13,520 Speaker 9: shelter component was still driving the bulk of the gains 213 00:10:13,559 --> 00:10:15,800 Speaker 9: in CPI, even though we're at the lowest level since 214 00:10:15,840 --> 00:10:18,920 Speaker 9: twenty twenty one. The labor market's gotten more cracks in 215 00:10:18,960 --> 00:10:21,560 Speaker 9: it than I would suggest. The official data is telling 216 00:10:21,640 --> 00:10:24,839 Speaker 9: us that means bond yields lower. There's an opportunity right 217 00:10:24,880 --> 00:10:27,880 Speaker 9: now to lean into the income that's available in high 218 00:10:27,960 --> 00:10:31,360 Speaker 9: quality bonds. Investors won't do it. Our work suggests that 219 00:10:31,520 --> 00:10:35,280 Speaker 9: people buy money market funds on mass until rates are zero. 220 00:10:35,480 --> 00:10:36,559 Speaker 7: We don't want that to happen. 221 00:10:36,600 --> 00:10:39,440 Speaker 3: Well A Sure, Paul Capital Economics publishes I love the 222 00:10:39,440 --> 00:10:41,600 Speaker 3: PA I've never seen this, folks in humpteen years. 223 00:10:41,960 --> 00:10:46,199 Speaker 2: BLS reports hard to believe slum in delation exactly A 224 00:10:46,240 --> 00:10:48,160 Speaker 2: sure needs more data exactly right. 225 00:10:48,960 --> 00:10:51,960 Speaker 5: Earnings earnings have been really solid in the last several quarters. 226 00:10:51,960 --> 00:10:54,040 Speaker 5: Here are they strong. 227 00:10:53,840 --> 00:10:55,360 Speaker 2: Enough to support this marketing going forward, I. 228 00:10:55,360 --> 00:10:58,160 Speaker 9: Think, yeah, you know, analysts are penciling in fourteen percent 229 00:10:58,200 --> 00:11:01,240 Speaker 9: earnings growth for the US next year. That is pretty lofty, 230 00:11:01,240 --> 00:11:03,120 Speaker 9: but as I mentioned before, there are a number of 231 00:11:03,160 --> 00:11:06,400 Speaker 9: tailwinds in place for corporate America. I would say, just 232 00:11:06,440 --> 00:11:09,679 Speaker 9: building on the America theme, we have the best earnings 233 00:11:09,720 --> 00:11:12,760 Speaker 9: growth of any companies globally in the United States. 234 00:11:12,840 --> 00:11:15,160 Speaker 7: You've seen that not be rewarded. This year. 235 00:11:15,240 --> 00:11:17,600 Speaker 9: The S and P five hundred up around fifteen percent. 236 00:11:18,000 --> 00:11:21,920 Speaker 9: European equities are up twice that amount. Guess what their 237 00:11:21,920 --> 00:11:25,440 Speaker 9: earnings growth is. It's low single digits. So what we've 238 00:11:25,440 --> 00:11:28,280 Speaker 9: seen again is this sentiment driven trade. 239 00:11:28,320 --> 00:11:29,080 Speaker 7: Bringing it over. 240 00:11:29,360 --> 00:11:34,040 Speaker 9: European financial stocks are up almost sixty percent this year. 241 00:11:34,120 --> 00:11:35,120 Speaker 7: Their earnings growth is. 242 00:11:35,080 --> 00:11:35,959 Speaker 2: Left for a decade. 243 00:11:36,240 --> 00:11:40,360 Speaker 3: I mean, in your shot, sure, with your track record, 244 00:11:41,000 --> 00:11:43,760 Speaker 3: what's the minimum timeline. 245 00:11:43,120 --> 00:11:46,959 Speaker 2: Our listeners and viewers should use. To me, it's three years. 246 00:11:47,360 --> 00:11:50,160 Speaker 2: The media doesn't do that right, and Sweeney's out at 247 00:11:50,240 --> 00:11:53,679 Speaker 2: seven years. But the answer is we're so the short 248 00:11:53,760 --> 00:11:55,360 Speaker 2: termism is unreal. 249 00:11:55,679 --> 00:11:58,160 Speaker 9: Well, that's fair, but if you look at the economic 250 00:11:58,200 --> 00:12:01,840 Speaker 9: growth picture, the macro is like on a different planet 251 00:12:02,200 --> 00:12:04,880 Speaker 9: from what's going on in these markets. The US from 252 00:12:04,880 --> 00:12:07,319 Speaker 9: an economic perspective is kind of like the clean of 253 00:12:07,400 --> 00:12:09,640 Speaker 9: shirt and the dirty laundry. Right now, if you look 254 00:12:09,679 --> 00:12:12,480 Speaker 9: at Europe, the data are coming in. I mean pmis, 255 00:12:12,520 --> 00:12:15,600 Speaker 9: for example for the Eurozone at forty nine point two. 256 00:12:16,000 --> 00:12:18,400 Speaker 7: It's okay, but it's not. 257 00:12:18,559 --> 00:12:21,280 Speaker 9: I don't think it justifies a thirty plus percent return 258 00:12:21,320 --> 00:12:24,240 Speaker 9: in Europe and eighty percent return in Spain. I think 259 00:12:24,280 --> 00:12:26,400 Speaker 9: these markets have run a lot and need trim into 260 00:12:26,400 --> 00:12:26,960 Speaker 9: strengthen too. 261 00:12:27,000 --> 00:12:27,400 Speaker 6: Next year. 262 00:12:27,480 --> 00:12:28,280 Speaker 2: Well, good one, Martin. 263 00:12:28,400 --> 00:12:31,160 Speaker 5: What do you do with dividends? Does that you play 264 00:12:31,200 --> 00:12:32,240 Speaker 5: with you guys at all? 265 00:12:32,400 --> 00:12:35,720 Speaker 9: Or I like anything that has like the word income 266 00:12:36,160 --> 00:12:39,280 Speaker 9: in it for next year? I think income over capital appreciation. 267 00:12:39,440 --> 00:12:41,400 Speaker 9: The problem is that the dividend yield on the S 268 00:12:41,440 --> 00:12:44,800 Speaker 9: and P five hundreds one point two percent right now, 269 00:12:44,800 --> 00:12:46,400 Speaker 9: and the fact that you can get four to five 270 00:12:46,400 --> 00:12:48,880 Speaker 9: percent in high quality bonds, I like that a bit better. 271 00:12:48,960 --> 00:12:50,760 Speaker 3: Okay, but you know, with a view of Trinity chops 272 00:12:50,760 --> 00:12:53,360 Speaker 3: from old and new, John Hancock, Emily Rowland and Tom 273 00:12:53,440 --> 00:12:57,920 Speaker 3: Keane worshiped at the altar of Margie Patel to Paul's 274 00:12:58,000 --> 00:13:02,160 Speaker 3: great question is dividend growth and alternative to yield? 275 00:13:02,679 --> 00:13:03,160 Speaker 7: I think so. 276 00:13:03,559 --> 00:13:07,360 Speaker 9: I mean again, we like this kind of relative value play, 277 00:13:07,440 --> 00:13:09,600 Speaker 9: and I think you're going to find those dividend growers 278 00:13:09,600 --> 00:13:12,640 Speaker 9: in that bucket. It's value and quality at a reasonable price. 279 00:13:12,720 --> 00:13:14,600 Speaker 2: What a God's name of the Red Sox do? When 280 00:13:14,640 --> 00:13:16,559 Speaker 2: I saw Bredman, we're the Patriots. 281 00:13:16,600 --> 00:13:19,880 Speaker 7: We're eleven and two, like unbelievable? 282 00:13:19,920 --> 00:13:22,520 Speaker 2: Are you in the Manual Life? Johnny Hancock's seats are 283 00:13:22,760 --> 00:13:23,520 Speaker 2: fifty yard line? 284 00:13:23,640 --> 00:13:27,520 Speaker 7: Yeah right, those are for the clients. I wish, I wish. 285 00:13:27,800 --> 00:13:30,599 Speaker 2: Emily Roland, thank you so much. You should see the 286 00:13:30,800 --> 00:13:34,640 Speaker 2: Red Sox tickets. It's just sick. She's with the Johnny 287 00:13:34,640 --> 00:13:35,319 Speaker 2: Hancock company. 288 00:13:35,360 --> 00:13:38,640 Speaker 3: I should say Manual Life John Hancock to do it correctly, 289 00:13:38,720 --> 00:13:42,680 Speaker 3: Emily Rowland, and she has been dead on about participating 290 00:13:43,480 --> 00:13:45,000 Speaker 3: in the markets. 291 00:13:45,200 --> 00:13:49,240 Speaker 8: Stay with us. More from Bloomberg Surveillance coming up after this. 292 00:13:56,440 --> 00:14:00,400 Speaker 1: This is the Bloomberg Surveillance Podcast. Listen live each weekdays 293 00:14:00,400 --> 00:14:03,640 Speaker 1: starting at seven am Eastern on Applecarplay and Android Auto 294 00:14:03,800 --> 00:14:06,760 Speaker 1: with the Bloomberg Business app. You can also listen live 295 00:14:06,840 --> 00:14:10,400 Speaker 1: on Amazon Alexa from our flagship New York station. Just 296 00:14:10,480 --> 00:14:12,959 Speaker 1: say Alexa play Bloomberg eleven thirty. 297 00:14:13,120 --> 00:14:14,880 Speaker 3: We have a special tree for your folks. I want 298 00:14:14,880 --> 00:14:16,640 Speaker 3: to frame this out as well as I can. You've 299 00:14:16,679 --> 00:14:21,440 Speaker 3: got a really odd headline this morning of breaking news. 300 00:14:21,480 --> 00:14:24,360 Speaker 3: I'm going to go right to the Bloomberg where we've 301 00:14:24,400 --> 00:14:28,560 Speaker 3: got Trump Media to combine with a company you don't know. 302 00:14:28,800 --> 00:14:32,600 Speaker 2: Tae to build nuclear fusion business. 303 00:14:33,440 --> 00:14:37,080 Speaker 3: My family goes back in this derby over forty years 304 00:14:37,680 --> 00:14:42,280 Speaker 3: to the Lawrence Livermore Lab and Paul the Endless Quest 305 00:14:42,880 --> 00:14:46,960 Speaker 3: to squeeze two atoms and two nucleus together. 306 00:14:47,480 --> 00:14:48,880 Speaker 2: Dan Ives is quite good on this. 307 00:14:49,000 --> 00:14:51,360 Speaker 3: We're going to talk to him with web Bush about 308 00:14:51,520 --> 00:14:55,000 Speaker 3: this combination before we talk to him about the state 309 00:14:55,080 --> 00:14:58,000 Speaker 3: of mag seven and technology. Well, Dan, thank you so 310 00:14:58,160 --> 00:15:01,880 Speaker 3: much for joining us on short notice. I go back 311 00:15:02,040 --> 00:15:05,960 Speaker 3: decades on this. Fusion has been a hope and a 312 00:15:06,080 --> 00:15:10,480 Speaker 3: dream forever. How is Donald Trump gonna finally get us 313 00:15:11,000 --> 00:15:14,080 Speaker 3: over this fragile line of successful physics. 314 00:15:15,120 --> 00:15:17,920 Speaker 2: Yeah, I mean, look, I focus more like with THAE. 315 00:15:18,520 --> 00:15:21,120 Speaker 10: I remember they're backers because I know them from a 316 00:15:21,200 --> 00:15:22,160 Speaker 10: fusion perspective. 317 00:15:22,280 --> 00:15:26,280 Speaker 2: Google, Chevron. Google and Chevron have been there, two major 318 00:15:26,480 --> 00:15:27,320 Speaker 2: recent players. 319 00:15:27,760 --> 00:15:30,640 Speaker 10: Yeah, I mean, you know Goldman some others. Look, I 320 00:15:30,720 --> 00:15:34,520 Speaker 10: think when it comes to nuclear fusion, what that's twenty 321 00:15:34,640 --> 00:15:39,480 Speaker 10: five plus years of the Maxwell winners, the Nobel winners 322 00:15:39,520 --> 00:15:40,320 Speaker 10: that they've had here. 323 00:15:40,880 --> 00:15:42,840 Speaker 2: So I've always viewed this is gonna be. 324 00:15:43,960 --> 00:15:48,480 Speaker 10: If there's a winner in the US and global nuclear fusion, 325 00:15:48,800 --> 00:15:49,320 Speaker 10: it's Tha. 326 00:15:49,680 --> 00:15:52,160 Speaker 2: So I think that's at the centerpiece of this whole deal. 327 00:15:52,560 --> 00:15:56,800 Speaker 10: It's much more about Thae and my view than in 328 00:15:56,960 --> 00:15:59,920 Speaker 10: terms on the Trump angle that's always the political backing. 329 00:16:00,360 --> 00:16:03,400 Speaker 3: Is this an arms race, if you will, a fusion 330 00:16:03,560 --> 00:16:07,720 Speaker 3: race with China. We saw what they did with electric vehicles, 331 00:16:08,240 --> 00:16:12,040 Speaker 3: your conversant in China and AI, the Nvidia chip debate 332 00:16:12,520 --> 00:16:15,720 Speaker 3: in that Is this like getting out in front of 333 00:16:15,960 --> 00:16:18,480 Speaker 3: China catching up a nuclear fusion. 334 00:16:19,440 --> 00:16:20,520 Speaker 2: That's what it's all about. 335 00:16:20,880 --> 00:16:22,520 Speaker 10: I mean, I think you know me and you've talked 336 00:16:22,520 --> 00:16:25,760 Speaker 10: about this and you know on the show this is 337 00:16:25,800 --> 00:16:28,640 Speaker 10: an arms race first China. I mean, everything they're focused 338 00:16:28,680 --> 00:16:31,440 Speaker 10: on is going in two thoy thirty, how they fuel AI, 339 00:16:31,640 --> 00:16:35,480 Speaker 10: arms ors technology. US is way ahead of China because 340 00:16:35,480 --> 00:16:38,320 Speaker 10: of the Vidio, because of Microsoft, because of Palentinger and others. 341 00:16:38,880 --> 00:16:40,000 Speaker 2: Energies are scarce. 342 00:16:40,080 --> 00:16:42,000 Speaker 10: The guy I've always said, like energy is going to 343 00:16:42,080 --> 00:16:44,600 Speaker 10: be the big scarcy in nuclear has to be the play. 344 00:16:45,080 --> 00:16:47,360 Speaker 10: You know, obviously there's AKA and others, but this will 345 00:16:47,440 --> 00:16:50,120 Speaker 10: clearly be the first fusion public play. 346 00:16:50,760 --> 00:16:53,960 Speaker 5: So Dan, I think most people understand the Trump Media 347 00:16:54,040 --> 00:16:57,480 Speaker 5: Company as a media play, a digital media play, if 348 00:16:57,520 --> 00:17:00,720 Speaker 5: you will, Can you tell us about TA because most 349 00:17:00,760 --> 00:17:02,280 Speaker 5: of us don't know a whole lot about Tha. 350 00:17:03,080 --> 00:17:06,359 Speaker 2: Yeah, and again, Thae I think is the centerpiece of 351 00:17:06,400 --> 00:17:06,960 Speaker 2: the whole deal. 352 00:17:07,040 --> 00:17:09,520 Speaker 10: I mean, even though it's a merger, it's it's really 353 00:17:09,560 --> 00:17:12,400 Speaker 10: about TAM I view. I think, look, when you look, 354 00:17:12,520 --> 00:17:15,720 Speaker 10: this is what twenty five, twenty eight years, you know, 355 00:17:15,840 --> 00:17:18,960 Speaker 10: most of out of California they've built I think it's 356 00:17:19,320 --> 00:17:23,040 Speaker 10: about five you know, sort of you know, but I'll 357 00:17:23,080 --> 00:17:27,440 Speaker 10: say few successful fusion buildouts this is one. 358 00:17:27,520 --> 00:17:30,800 Speaker 2: I think it's five Nobels, so many. 359 00:17:30,760 --> 00:17:34,080 Speaker 10: Maxwell's, you know, in terms of from scientists that have 360 00:17:34,200 --> 00:17:36,800 Speaker 10: been through their schwab backing, you know, it's kind of 361 00:17:36,840 --> 00:17:38,600 Speaker 10: who's who in terms of what they've had back. But 362 00:17:39,119 --> 00:17:41,040 Speaker 10: this has really been one coming out of the cow 363 00:17:41,359 --> 00:17:46,479 Speaker 10: system science community, and that's always what it was known as. 364 00:17:46,560 --> 00:17:49,840 Speaker 2: It was always sort of a gem in the science community. Yeah, 365 00:17:49,880 --> 00:17:51,879 Speaker 2: I noticed Jeff Immil was a former board member. 366 00:17:51,960 --> 00:17:54,680 Speaker 3: But with TAE, folks to see Eugene mondays there it 367 00:17:54,800 --> 00:17:59,000 Speaker 3: was just absolutely definitive across all political lines of America. 368 00:17:59,119 --> 00:18:03,600 Speaker 3: Doctor Moneys, of course associated with MIT they let's say 369 00:18:03,720 --> 00:18:07,480 Speaker 3: Dan as a statement, Tae has a heavyweight board, but 370 00:18:07,640 --> 00:18:10,719 Speaker 3: you got to get something done. Going back to Lawrence 371 00:18:10,800 --> 00:18:14,920 Speaker 3: Livermore lab ages ago, it's a lot of theory, it's 372 00:18:14,960 --> 00:18:19,399 Speaker 3: a lot of politics, including the Advance Act accelerating deployment 373 00:18:19,480 --> 00:18:22,879 Speaker 3: of versatile advanced nuclear for clean energy. It sounds like 374 00:18:22,920 --> 00:18:26,160 Speaker 3: an episode Dan Iisa gets Smart, except you're too young 375 00:18:26,240 --> 00:18:27,840 Speaker 3: to remember Get Smart. 376 00:18:28,200 --> 00:18:33,600 Speaker 2: But the answer is, is there any indication fusion will work? Oh? 377 00:18:33,680 --> 00:18:36,520 Speaker 2: I think that's that's you don't do this deal. But 378 00:18:36,560 --> 00:18:38,000 Speaker 2: you don't think this is going to work. 379 00:18:38,240 --> 00:18:41,080 Speaker 10: I mean, if you look with Tae is done, it's 380 00:18:41,119 --> 00:18:43,240 Speaker 10: not just I think like the best bet from a 381 00:18:43,400 --> 00:18:47,920 Speaker 10: US perspective and even global relative to energy. And clearly 382 00:18:48,040 --> 00:18:50,120 Speaker 10: there have been obviously so many starts and stops when 383 00:18:50,119 --> 00:18:52,760 Speaker 10: it comes to fusion. But I do believe this is 384 00:18:52,920 --> 00:18:56,040 Speaker 10: one where when you look at breakthroughs combined with what 385 00:18:56,200 --> 00:18:58,440 Speaker 10: you'd get from a capital perspective. 386 00:18:58,480 --> 00:19:01,320 Speaker 2: Because we've alreays said like that's part arms raised. That's 387 00:19:01,400 --> 00:19:04,480 Speaker 2: why this would be such unique combo. You know, Paul 388 00:19:04,520 --> 00:19:05,000 Speaker 2: this is great. 389 00:19:05,000 --> 00:19:07,640 Speaker 3: I want to thank the Kliman Center for Energy Policy 390 00:19:08,040 --> 00:19:10,760 Speaker 3: at the University Pennsylvania for getting me up to speed 391 00:19:11,119 --> 00:19:14,280 Speaker 3: on this. They got a chart in here from Sorbone 392 00:19:14,400 --> 00:19:17,320 Speaker 3: nineteen fifteen, a proposed power plant. 393 00:19:17,600 --> 00:19:20,359 Speaker 11: It looks like the set of Silo, right, I mean 394 00:19:20,440 --> 00:19:25,200 Speaker 11: that's what yeah, I did, Lanman in hydrocarbons. The fusion 395 00:19:25,720 --> 00:19:28,240 Speaker 11: thing looks like the set of Silo's. 396 00:19:27,800 --> 00:19:31,199 Speaker 5: Exactly what Dan from Ta East perspective. Why are they 397 00:19:31,280 --> 00:19:34,720 Speaker 5: merging with Trump's media president Trump's media company? 398 00:19:35,640 --> 00:19:39,200 Speaker 10: I think probably two reasons, right, I mean one capital, 399 00:19:39,800 --> 00:19:41,719 Speaker 10: I'm I think Trump you will get what two two 400 00:19:41,760 --> 00:19:45,239 Speaker 10: and a half billion cash and you know, bigcoins your 401 00:19:45,320 --> 00:19:48,119 Speaker 10: capital you get right away if you did this right 402 00:19:48,200 --> 00:19:50,840 Speaker 10: as I suppose, if it just merged into just a. 403 00:19:50,920 --> 00:19:53,520 Speaker 2: Regular spot, they'd have no capital. So that's one. 404 00:19:53,960 --> 00:19:57,600 Speaker 10: And obviously it's political backing, right, I mean implied relative 405 00:19:57,680 --> 00:19:58,640 Speaker 10: Trump administration. 406 00:19:59,600 --> 00:20:02,800 Speaker 2: It's a essentially kind of them picking the winner more 407 00:20:02,920 --> 00:20:05,080 Speaker 2: or less. I think that's how it be viewed. 408 00:20:05,520 --> 00:20:05,680 Speaker 10: Dan. 409 00:20:05,800 --> 00:20:08,280 Speaker 3: Let us migrate over to technology right now. Of course, 410 00:20:08,320 --> 00:20:11,080 Speaker 3: it's a day to day thing. My book of the Summer, 411 00:20:11,160 --> 00:20:13,320 Speaker 3: I think a year ago, two years ago is chip War. 412 00:20:13,440 --> 00:20:16,600 Speaker 3: It was just a fabulous book and Shipwoark showed how 413 00:20:16,720 --> 00:20:21,920 Speaker 3: discrete and apart Micron of Idaho is. They're really really 414 00:20:22,080 --> 00:20:28,119 Speaker 3: good at making simple technology simple semiconductors and such. Dan, iives, 415 00:20:28,200 --> 00:20:32,360 Speaker 3: what did you glean from the Micron optimism we saw yesterday? 416 00:20:33,480 --> 00:20:35,840 Speaker 10: Look, I mean you talk about like the right news 417 00:20:35,880 --> 00:20:39,359 Speaker 10: at the right time relative to nervousness Oracle data center, 418 00:20:39,560 --> 00:20:41,560 Speaker 10: you know, and obviously a lot of the war is 419 00:20:41,560 --> 00:20:43,600 Speaker 10: about the build out. Look that is just for the 420 00:20:43,720 --> 00:20:47,760 Speaker 10: validation demand, the supply ten to one, right, twelve to one. 421 00:20:47,960 --> 00:20:51,720 Speaker 10: It just shows what's happening in terms of these AI buildouts, 422 00:20:51,800 --> 00:20:55,159 Speaker 10: and of course Nvidia and aim the another Micron is 423 00:20:55,200 --> 00:20:58,680 Speaker 10: obviously front and center relative to you know what I 424 00:20:58,920 --> 00:21:02,440 Speaker 10: kind of view as the core sort of you know, 425 00:21:03,000 --> 00:21:06,680 Speaker 10: barometer relative to these AI buildouts. And I think that's 426 00:21:06,960 --> 00:21:09,680 Speaker 10: investors are going to view this. I think it's come 427 00:21:09,800 --> 00:21:10,920 Speaker 10: some nerves. 428 00:21:11,040 --> 00:21:13,520 Speaker 2: Especially given where we are with the lack of news 429 00:21:13,640 --> 00:21:17,280 Speaker 2: relative to companies coming to pulse. That's the huge thing here. 430 00:21:17,359 --> 00:21:20,680 Speaker 3: You've experienced this too, the lack news pop Microme in 431 00:21:20,680 --> 00:21:25,280 Speaker 3: the last ten years. Yeah, it's just appalling thirty three 432 00:21:25,480 --> 00:21:27,520 Speaker 3: point two percent per year. 433 00:21:27,760 --> 00:21:29,560 Speaker 2: Yep, that's what the recent moonshot. 434 00:21:30,480 --> 00:21:33,119 Speaker 5: Hey, Dan, just with this deal with TAE today just 435 00:21:33,359 --> 00:21:36,200 Speaker 5: highlight for us again kind of what to what extent 436 00:21:36,320 --> 00:21:40,520 Speaker 5: will power and access to power and the grid be 437 00:21:41,119 --> 00:21:43,880 Speaker 5: maybe a headwind for this AI rollout in development. 438 00:21:45,119 --> 00:21:46,920 Speaker 2: Look, I mean. 439 00:21:46,880 --> 00:21:49,560 Speaker 10: Today three percent of companies have gone down the AI path. 440 00:21:49,600 --> 00:21:51,600 Speaker 10: I mean you get the twenty percent you don't essentially 441 00:21:51,640 --> 00:21:54,600 Speaker 10: have enough power. So obviously right now in terms of 442 00:21:54,680 --> 00:21:58,200 Speaker 10: a grid solar that's going to be sort of important 443 00:21:58,200 --> 00:21:59,800 Speaker 10: in terms of stop gaps. 444 00:22:00,520 --> 00:22:02,639 Speaker 2: But but to me, the only way you get there 445 00:22:02,760 --> 00:22:03,360 Speaker 2: is nuclear. 446 00:22:03,480 --> 00:22:06,320 Speaker 10: And like I've said, like nuclear has to be the answer, 447 00:22:06,320 --> 00:22:09,120 Speaker 10: and you have a clean energy right when it comes 448 00:22:09,160 --> 00:22:11,520 Speaker 10: to fusion, like this is gonna be the bet you 449 00:22:11,680 --> 00:22:15,399 Speaker 10: got to make big bets quick and obviously ta in 450 00:22:15,520 --> 00:22:17,960 Speaker 10: my own view in the US that that continues to 451 00:22:18,000 --> 00:22:19,200 Speaker 10: be probably the best bet we have. 452 00:22:19,680 --> 00:22:22,200 Speaker 3: I have real trouble with this, Dan, because I've seen 453 00:22:22,320 --> 00:22:25,879 Speaker 3: decades and decades and decades of Yeah, we're gonna do it, 454 00:22:26,000 --> 00:22:27,480 Speaker 3: We're gonna do it, cross our. 455 00:22:27,440 --> 00:22:30,640 Speaker 2: Fingers, hope to die, We're gonna do nuclear fusion. 456 00:22:31,080 --> 00:22:33,840 Speaker 3: In your research, I mean, people don't realize this, but 457 00:22:33,960 --> 00:22:37,119 Speaker 3: away from the camera, lives actually works short. Yeah, do 458 00:22:37,240 --> 00:22:40,800 Speaker 3: you see imminent research where someone at Google and Physics 459 00:22:41,280 --> 00:22:43,000 Speaker 3: can say this stuff is gonna work. 460 00:22:44,119 --> 00:22:44,320 Speaker 2: Yeah. 461 00:22:44,359 --> 00:22:48,880 Speaker 10: I mean, look, I don't think Google, Chevron, you know, Gold, 462 00:22:49,000 --> 00:22:51,560 Speaker 10: and I think many other tech players that you know 463 00:22:51,720 --> 00:22:54,760 Speaker 10: that have looked at this company, they're not doing it 464 00:22:54,960 --> 00:22:55,919 Speaker 10: if nothing's happened. 465 00:22:55,920 --> 00:22:57,000 Speaker 2: I mean, I truly. 466 00:22:56,840 --> 00:23:02,160 Speaker 12: Believe like they've had breakthroughs, which is what's unique after 467 00:23:02,280 --> 00:23:05,359 Speaker 12: obviously decades and decades, like you've said, coming out of 468 00:23:05,440 --> 00:23:09,200 Speaker 12: labs of the theory, but not actually being able to scale. 469 00:23:10,840 --> 00:23:11,000 Speaker 2: Dan. 470 00:23:11,080 --> 00:23:13,280 Speaker 3: I so this is what Bush. We continue this morning. 471 00:23:13,320 --> 00:23:16,080 Speaker 3: We welcome all of you across at the nation, around 472 00:23:16,080 --> 00:23:18,360 Speaker 3: the world. Good evening on the Pacific rim a place 473 00:23:18,440 --> 00:23:21,719 Speaker 3: for mister Ives visits often. Good evening over to India 474 00:23:21,800 --> 00:23:24,480 Speaker 3: as well, Tom Kane and Paul Sweeting. 475 00:23:24,640 --> 00:23:26,920 Speaker 5: Dan, what's the as you think about twenty twenty six 476 00:23:27,040 --> 00:23:30,040 Speaker 5: and you travel a lot, meeting with institutional investors, meeting 477 00:23:30,080 --> 00:23:32,879 Speaker 5: with companies within the tech space, what's kind of the 478 00:23:33,600 --> 00:23:35,560 Speaker 5: number one talking point for twenty twenty six. 479 00:23:36,720 --> 00:23:37,480 Speaker 2: I think it's ultimate. 480 00:23:37,520 --> 00:23:40,560 Speaker 10: It's modernization of AI, right, In other words, it's to 481 00:23:40,680 --> 00:23:44,000 Speaker 10: build out what the use cases look like, not just 482 00:23:44,119 --> 00:23:46,040 Speaker 10: on the enterprise and on the consumer side, and it 483 00:23:46,080 --> 00:23:49,560 Speaker 10: will get to race right like from Meta to Microsoft 484 00:23:49,680 --> 00:23:50,520 Speaker 10: to you know whoever. 485 00:23:50,560 --> 00:23:53,159 Speaker 2: From a cap backs perspective, that continues to be. 486 00:23:54,000 --> 00:23:57,720 Speaker 10: The focus demondization, and I think that's really going to 487 00:23:57,800 --> 00:23:58,600 Speaker 10: define the winners. 488 00:24:00,040 --> 00:24:03,520 Speaker 3: Qicklear, Dan, I've I got January twenty ninth of next 489 00:24:03,640 --> 00:24:08,840 Speaker 3: year twenty six, twenty twenty six Microsoft earnings. 490 00:24:09,200 --> 00:24:11,560 Speaker 2: I agree with you, Dan. Part of the angst here 491 00:24:12,000 --> 00:24:13,480 Speaker 2: is an information vacuum. 492 00:24:13,840 --> 00:24:16,760 Speaker 3: What's the information you're going to see it four fifteen 493 00:24:16,800 --> 00:24:20,400 Speaker 3: in the afternoon, January twenty ninth from MSFT. 494 00:24:21,760 --> 00:24:25,119 Speaker 10: I think it's the monization from Azure and what you 495 00:24:25,240 --> 00:24:27,720 Speaker 10: see from AI. I think the reality is is that 496 00:24:28,320 --> 00:24:30,680 Speaker 10: thirty percent of the Microsoft deals are track and have 497 00:24:30,760 --> 00:24:33,240 Speaker 10: been accelerated when it comes to AI over the last 498 00:24:33,320 --> 00:24:36,800 Speaker 10: few months. So as that plays out and the forecast 499 00:24:36,880 --> 00:24:39,840 Speaker 10: plays out and they reiterate their cap backs, I think 500 00:24:39,880 --> 00:24:42,520 Speaker 10: it's further validation that when it comes to the enterprise, 501 00:24:42,680 --> 00:24:44,520 Speaker 10: Microsoft is going to be the core winner. 502 00:24:45,000 --> 00:24:45,880 Speaker 2: When it comes to AI. 503 00:24:46,320 --> 00:24:48,320 Speaker 3: I think that to get the nuclear fusion thing over 504 00:24:48,359 --> 00:24:50,840 Speaker 3: the line, they got to merge dan ives Bright Pink 505 00:24:50,920 --> 00:24:52,520 Speaker 3: and bright Green jackets together. 506 00:24:53,119 --> 00:24:56,040 Speaker 2: That'll get you there. The entropy to get us to 507 00:24:56,680 --> 00:25:01,760 Speaker 2: a successful fusion Dan ives stay with us. 508 00:25:02,080 --> 00:25:05,200 Speaker 8: More from Bloomberg Surveillance coming up after this. 509 00:25:12,400 --> 00:25:16,280 Speaker 1: This is the Bloomberg Surveillance Podcast. Listen live each weekday 510 00:25:16,320 --> 00:25:19,320 Speaker 1: starting at seven am Eastern on Apple Coarclay, and Android 511 00:25:19,359 --> 00:25:22,359 Speaker 1: Auto with the Bloomberg Business App. You can also listen 512 00:25:22,480 --> 00:25:25,720 Speaker 1: live on Amazon Alexa from our flagship New York station. 513 00:25:26,280 --> 00:25:29,720 Speaker 1: Just say Alexa, play Bloomberg eleven thirty digitally. 514 00:25:29,920 --> 00:25:31,520 Speaker 2: She's here today with the newspapers. 515 00:25:31,880 --> 00:25:33,480 Speaker 13: Now, I want to start with this because we have 516 00:25:33,600 --> 00:25:36,399 Speaker 13: a few headlines about the Warner Brothers deal. First, you 517 00:25:36,480 --> 00:25:38,439 Speaker 13: have the Wall Street Journal right there talking about how 518 00:25:38,480 --> 00:25:40,520 Speaker 13: Warner Brothers wants more info about the use of an 519 00:25:40,560 --> 00:25:44,480 Speaker 13: Ellison family trust to backstop that deal because a big 520 00:25:44,560 --> 00:25:47,960 Speaker 13: part of that trust is Oracle shares, and Warner wants 521 00:25:48,000 --> 00:25:50,560 Speaker 13: Larry Ellison to give this stronger personal guarantee that he 522 00:25:50,960 --> 00:25:53,200 Speaker 13: and not the trust, is committed to the bid. And 523 00:25:53,280 --> 00:25:56,120 Speaker 13: then you have the Financial Times reporting that a Warner 524 00:25:56,160 --> 00:25:59,200 Speaker 13: Brothers shareholder is reaching out to an investor to acquire 525 00:25:59,320 --> 00:26:04,719 Speaker 13: all our part of it's cable TV ascids, CNN, CNN, 526 00:26:04,880 --> 00:26:07,880 Speaker 13: tn T Discover like all those all those it's said 527 00:26:07,880 --> 00:26:10,760 Speaker 13: it's Sue Kim, founder of New York hedge funds Standard General. 528 00:26:10,880 --> 00:26:14,080 Speaker 13: He's been in talks apparently for buying investing in the 529 00:26:14,119 --> 00:26:15,680 Speaker 13: television networks and he's done. 530 00:26:15,560 --> 00:26:16,720 Speaker 6: TV deals before. 531 00:26:17,000 --> 00:26:17,200 Speaker 2: Yeah. 532 00:26:17,359 --> 00:26:20,920 Speaker 5: Well, Bloomberg's Matt Levine's his Money Stuff column yesterday goes 533 00:26:21,000 --> 00:26:24,720 Speaker 5: to this whole revocable trust from the Ellison really explains it. 534 00:26:26,440 --> 00:26:29,320 Speaker 5: It's basically saying, hey, revocable trust has it's gota jillions 535 00:26:29,359 --> 00:26:31,680 Speaker 5: of dollars of Oracle stock, but at any point in 536 00:26:31,720 --> 00:26:33,719 Speaker 5: time that can be removed from the trust, and then 537 00:26:33,800 --> 00:26:36,479 Speaker 5: the trust has got no value. And then you're like, Okay, well, 538 00:26:36,480 --> 00:26:39,200 Speaker 5: where's my backstop, mister Ellison. And that's kind of where 539 00:26:39,240 --> 00:26:41,080 Speaker 5: the Warner Brothers board is here. They're saying, we need 540 00:26:41,160 --> 00:26:44,720 Speaker 5: the we need mister Ellison's personal guarantee in some form 541 00:26:45,000 --> 00:26:45,159 Speaker 5: for this. 542 00:26:45,600 --> 00:26:47,760 Speaker 2: We had to go. It's Lisa's newspaper segment. 543 00:26:47,800 --> 00:26:50,440 Speaker 3: But Paul, are we surprised at the I'm going to 544 00:26:50,480 --> 00:26:54,560 Speaker 3: say modest valuation of the traditional TV product? 545 00:26:54,800 --> 00:26:59,280 Speaker 5: Yeah, the cable network businesses are being it's like teen 546 00:26:59,359 --> 00:27:03,280 Speaker 5: sweets and it's almost who cares. It's just you know, 547 00:27:03,400 --> 00:27:10,200 Speaker 5: I get Lisa, I mean Laura Martin from Yeah, she 548 00:27:10,359 --> 00:27:12,480 Speaker 5: just said shut them down, just turn them off off 549 00:27:12,520 --> 00:27:13,720 Speaker 5: the likes Lisa next. 550 00:27:13,800 --> 00:27:16,320 Speaker 13: Please all right, this is an interesting look into the 551 00:27:16,359 --> 00:27:19,480 Speaker 13: housing market. This was in the journal. How more wealthy 552 00:27:19,600 --> 00:27:23,919 Speaker 13: renters are customizing their spaces and the landlords. 553 00:27:23,400 --> 00:27:24,280 Speaker 2: Are okay with it. 554 00:27:24,840 --> 00:27:26,520 Speaker 6: They even encourage it sometimes. 555 00:27:26,560 --> 00:27:28,520 Speaker 13: I mean, we're talking about those who spend between twenty 556 00:27:28,560 --> 00:27:30,720 Speaker 13: thousand and fifty thousand a month, you know, for a 557 00:27:30,800 --> 00:27:34,040 Speaker 13: luxury single family home or apartment. So they spoke with 558 00:27:34,160 --> 00:27:36,720 Speaker 13: realtors who say the landlords are okay if it increases 559 00:27:36,800 --> 00:27:39,879 Speaker 13: the value. More and more people are doing it. They 560 00:27:39,920 --> 00:27:42,879 Speaker 13: gave the example of a three bedroom condominium. These owners 561 00:27:42,920 --> 00:27:46,280 Speaker 13: bought it in Lennox Hill and they paid about fourteen 562 00:27:46,320 --> 00:27:50,119 Speaker 13: point eight million, but their renters paid fifty thousand dollars 563 00:27:50,200 --> 00:27:53,160 Speaker 13: a month to rent it. They made two million dollar 564 00:27:53,480 --> 00:27:57,560 Speaker 13: renovation when they moved into. The renters did so it's 565 00:27:57,600 --> 00:27:59,840 Speaker 13: showing how much they're putting into it. 566 00:28:00,119 --> 00:28:04,640 Speaker 2: I don't know, just that bizarre doesn't capture it. It's 567 00:28:04,720 --> 00:28:08,600 Speaker 2: just strange they're renting it. What's the taxes on fourteen 568 00:28:08,720 --> 00:28:13,800 Speaker 2: million dollars? Oh gosh, yeah, then there's that. So this 569 00:28:13,960 --> 00:28:15,720 Speaker 2: is more than just throwing a coat of pain at it. 570 00:28:15,960 --> 00:28:19,560 Speaker 13: No, it is it's getting new bathrooms, like redoing the kitchen, 571 00:28:19,960 --> 00:28:22,560 Speaker 13: like getting and putting up wallpaper, which you know is 572 00:28:22,640 --> 00:28:25,160 Speaker 13: tough to take down, so all that kind of stuff. 573 00:28:25,200 --> 00:28:28,080 Speaker 13: They're just redoing the house to their likings, and the 574 00:28:28,160 --> 00:28:30,360 Speaker 13: landlord's okay, if it increases. 575 00:28:29,920 --> 00:28:35,960 Speaker 6: Their value, you go, okay, that was painful, and this 576 00:28:36,119 --> 00:28:36,560 Speaker 6: one okay. 577 00:28:36,600 --> 00:28:39,360 Speaker 13: So we talk about birth rates falling, but there's new 578 00:28:39,480 --> 00:28:42,400 Speaker 13: research out there because a lot of people blame, oh, well, 579 00:28:42,440 --> 00:28:45,480 Speaker 13: people want pets and they're doing that instead of having kids. 580 00:28:46,040 --> 00:28:48,320 Speaker 13: You know, they're pushing the pets around in the carriages 581 00:28:48,400 --> 00:28:49,600 Speaker 13: and dressing them up like kids. 582 00:28:49,960 --> 00:28:51,280 Speaker 6: That's that's what we're dealing with. 583 00:28:51,400 --> 00:28:54,560 Speaker 13: But now there's this new research that say, actually having 584 00:28:54,640 --> 00:28:57,800 Speaker 13: a pet can make people want to become parents more. 585 00:28:58,640 --> 00:28:59,880 Speaker 7: They did this study in tai w. 586 00:29:00,200 --> 00:29:01,560 Speaker 13: With the birth rate is one of the lowest in 587 00:29:01,640 --> 00:29:03,840 Speaker 13: the world, and that's what they're showing is that pets 588 00:29:03,880 --> 00:29:07,600 Speaker 13: aren't replacing babies, are actually pre seating them. So really 589 00:29:07,800 --> 00:29:10,640 Speaker 13: it's more like a trial run. I guess you could say, 590 00:29:10,680 --> 00:29:13,040 Speaker 13: why why they have the dogs first and then they 591 00:29:13,120 --> 00:29:16,960 Speaker 13: have the kids after, So it's not in replace of it's. 592 00:29:16,960 --> 00:29:19,640 Speaker 2: Just like the kennel fee for kennel fee. 593 00:29:19,960 --> 00:29:21,680 Speaker 6: Yes, it's like like a. 594 00:29:21,720 --> 00:29:22,920 Speaker 2: Precursor for child. 595 00:29:23,760 --> 00:29:26,480 Speaker 13: So you should have had the pets first before the kids, 596 00:29:26,520 --> 00:29:28,239 Speaker 13: and then you realize how expensive they are. 597 00:29:29,200 --> 00:29:32,000 Speaker 3: The latest battle was Paul, should the dogs have the 598 00:29:32,080 --> 00:29:34,400 Speaker 3: little booties on as they walk around out right? 599 00:29:34,680 --> 00:29:39,080 Speaker 2: Yeh, nothing. We don't have the booties. The boy, we don't. 600 00:29:39,160 --> 00:29:40,120 Speaker 2: We don't do the booties. 601 00:29:40,280 --> 00:29:41,160 Speaker 13: I've seen the booties. 602 00:29:41,200 --> 00:29:43,080 Speaker 6: They're very cute, they're very social. 603 00:29:43,160 --> 00:29:45,720 Speaker 2: I've got some of their sweaters out. You know that 604 00:29:45,880 --> 00:29:49,080 Speaker 2: Bill is very festive. But we didn't go with the booties. 605 00:29:49,960 --> 00:29:54,160 Speaker 3: The newspapers, Lisa Matteo, always interesting, always entertaining. 606 00:29:54,360 --> 00:29:59,160 Speaker 1: This is the Bloomberg Surveillance podcast, available on Apple, Spotify, 607 00:29:59,320 --> 00:30:03,560 Speaker 1: and anywhere else you get your podcasts. 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