WEBVTT - Bloomberg Businessweek Weekend - February 24th, 2023 0:00:01.280 --> 0:00:05.640 This is Bloomberg business Week inside from the reporters and 0:00:05.840 --> 0:00:09.400 editors who bring you America's most trusted business magazine, plus 0:00:09.480 --> 0:00:13.640 global business finance and tech news. The Bloomberg Business Week 0:00:13.680 --> 0:00:18.600 Podcast with Carol Messer and Tim Stenebec from Bloomberg Radio. 0:00:19.640 --> 0:00:23.360 So much going on when it comes to geopolitical news 0:00:23.400 --> 0:00:27.080 on our radar. Chinese President she urging his country to 0:00:27.160 --> 0:00:30.880 accelerate fundamental scientific research so it could become self reliant 0:00:30.880 --> 0:00:34.760 in critical technologies, basically really kind of countering Washington sanctions 0:00:34.760 --> 0:00:37.600 on everything from semis to software. You've also got a 0:00:37.680 --> 0:00:40.120 Chinese top diplomat calling for peace talks to resolve the 0:00:40.159 --> 0:00:43.120 Russian war in Ukraine. And then there's a fascinating Bloomberg 0:00:43.200 --> 0:00:46.239 opinion piece today that talks about if American intelligence is 0:00:46.320 --> 0:00:49.159 right and China really is about to arm Russia in 0:00:49.200 --> 0:00:52.640 its genocidal war against Ukraine, we may be entering a 0:00:52.720 --> 0:00:55.880 new era in international relations, asking if it may be 0:00:56.000 --> 0:00:58.680 an even more dangerous one to dress it all. We've 0:00:58.680 --> 0:01:02.920 got ed price principle for the geopolitical forecasting firm, or 0:01:03.280 --> 0:01:06.679 he Is principle, i should say, of geopolitical forecasting at ERGO, 0:01:06.720 --> 0:01:09.720 which is a global intelligence consulting in forecasting firm. By 0:01:09.720 --> 0:01:12.440 the way, Ed a former British trade official, his work 0:01:12.480 --> 0:01:14.520 with members of the European and British parliaments. We are 0:01:14.600 --> 0:01:17.679 so delighted to have him here with Maddie and myself. Ed. 0:01:17.760 --> 0:01:20.840 There is so much going on. How do you separate 0:01:20.880 --> 0:01:22.960 out the week from the chaff when it comes to 0:01:23.040 --> 0:01:27.440 what's going on in foreign affairs and geopolitics? Hi, Carol, 0:01:27.440 --> 0:01:30.119 I hope you guys are very well. It's difficult, right 0:01:30.120 --> 0:01:33.720 It's really hard right now to separate the signal from 0:01:33.720 --> 0:01:37.440 the noise. My firm was previously very successful at doing 0:01:37.480 --> 0:01:39.160 that at the start of this war. If you remember, 0:01:39.200 --> 0:01:42.120 we very successfully called it. We know, we said they 0:01:42.160 --> 0:01:45.960 were going in with the seventy eight percent confidence a 0:01:46.080 --> 0:01:48.960 year ago. Today, a year later, it does seem that 0:01:49.000 --> 0:01:52.920 the war in Ukraine is harder to read. I would suggest, 0:01:52.960 --> 0:01:55.960 although there are probably a few a few themes that 0:01:56.000 --> 0:01:59.440 we can point to that might help. One of them, Carol, 0:01:59.720 --> 0:02:02.080 is the just at the moment that it seems that 0:02:02.200 --> 0:02:05.720 Russian mistakes are compounding. And by Russian mistakes I mean 0:02:05.800 --> 0:02:09.520 the sort of strategic tomfoolery of using your best troops 0:02:09.560 --> 0:02:13.679 the spetsnaz your naval infantry, your parachute paratroopers at the 0:02:13.720 --> 0:02:16.279 start of the conflict and getting them essentially killed disproportionate 0:02:16.320 --> 0:02:19.919 to other troops. Strategic mistakes like that are compounding at 0:02:19.960 --> 0:02:22.880 just the time that the Ukrainians are getting new vehicles, 0:02:22.960 --> 0:02:25.440 new equipment, and the morale is very high. So I 0:02:25.440 --> 0:02:28.480 think that's maybe one thing. So when we zoom out 0:02:28.600 --> 0:02:31.720 from the Russia Ukraine situation and look a little bit 0:02:31.720 --> 0:02:36.520 more broadly at all of the global geopolitical tensions right now, Ukraine, China, 0:02:36.639 --> 0:02:41.360 the global economy, spy balloons, what is your biggest concern 0:02:41.680 --> 0:02:46.280 and situation to watch for the year ahead? Right? I mean, 0:02:46.320 --> 0:02:48.600 I would be very clear that my biggest concern is 0:02:48.639 --> 0:02:53.080 not necessarily the most likely concern. The biggest concern, of course, 0:02:53.200 --> 0:02:56.480 should be that this local war in Ukraine and that 0:02:56.560 --> 0:03:00.640 the threat of conflict over or in Taiwan become the 0:03:00.680 --> 0:03:04.080 same thing, and that there is a general confluence of 0:03:04.160 --> 0:03:06.560 the sorts of trends that we're seeing with regard to 0:03:06.600 --> 0:03:09.359 great power competition right now. I don't think that that's 0:03:09.440 --> 0:03:13.440 likely that must remain the biggest concern. But within that, 0:03:13.480 --> 0:03:15.560 I mean, you guys just mentioned the fact that the 0:03:15.639 --> 0:03:20.359 Chinese might be thinking about arming the Russians is helping 0:03:21.120 --> 0:03:24.720 with material, that is a concern because, of course, you know, 0:03:25.320 --> 0:03:29.520 ridiculous spy blooms are one thing, but sending arms, sending 0:03:29.720 --> 0:03:33.560 lethal aid to Europe from China, you know, when you 0:03:33.600 --> 0:03:37.040 think about it, that's that's very concerning. You know, it's interesting. 0:03:37.040 --> 0:03:40.680 In this opinion piece too, it says Chinese military support 0:03:40.680 --> 0:03:43.120 for Russia. Again it's an opinion piece by Andrea's Cluth 0:03:43.480 --> 0:03:46.040 said Chinese military support for Russia would finally turn the 0:03:46.080 --> 0:03:49.400 Ukrainian conflict into a proxy war between two hostile blocks 0:03:49.560 --> 0:03:51.480 with a third trying to stay out of the fray. 0:03:52.520 --> 0:03:55.440 And it does I do wonder, you know, ed, do 0:03:55.480 --> 0:03:57.400 we need to be thinking that this is this is 0:03:57.440 --> 0:04:00.640 where we're going. We've talked about kind of a technology 0:04:00.720 --> 0:04:04.040 war and different things going on, but is this what happened? 0:04:04.040 --> 0:04:07.480 We're dividing the world up into maybe three key blocks here. 0:04:09.200 --> 0:04:12.040 I think that the essence of the problem is that 0:04:12.200 --> 0:04:15.119 Uncle Sam did half a job after the Second World War, 0:04:15.520 --> 0:04:19.400 and by that I mean he conquered three countries, Germany, 0:04:19.520 --> 0:04:22.279 Japan and the United Kingdom. I wouldn't necessarily put it 0:04:22.320 --> 0:04:25.839 like that to my friends, But he did and filled 0:04:25.839 --> 0:04:29.280 those three countries with two things, democracy and free markets. 0:04:30.040 --> 0:04:33.279 For then some unknown reason after that, Uncle Sam decided 0:04:33.360 --> 0:04:36.320 that the two big naughty countries China and Russia. And 0:04:36.360 --> 0:04:38.679 again I wouldn't necessarily call them naughty to their faces, 0:04:39.080 --> 0:04:41.799 but the two big naughty countries were only given access 0:04:41.880 --> 0:04:45.480 to markets, right and not? There wasn't a concerted effort 0:04:45.480 --> 0:04:49.120 to export democracy to Russia and China. So in a way, 0:04:49.960 --> 0:04:52.960 we Americans I'm America. Now, we Americans have done half 0:04:52.960 --> 0:04:55.520 a job after the Second World War? And the big 0:04:55.640 --> 0:04:58.040 question is can you get away with that? Is it 0:04:58.040 --> 0:05:02.839 okay that democracy only really went halfway around the world 0:05:02.960 --> 0:05:05.640 when the means of markets and capitalism went all the 0:05:05.680 --> 0:05:08.600 way around? That's that's so interesting. I love the way 0:05:08.640 --> 0:05:10.760 you put that. My question with China in the US 0:05:10.800 --> 0:05:14.320 specifically is always like it's a symbiotic relationship, right, if 0:05:14.360 --> 0:05:18.640 we need each other. Can China really afford to risk 0:05:19.200 --> 0:05:23.280 interacting with Russia on the war when its economy just reopened? 0:05:24.040 --> 0:05:26.200 I wonder, in the context of what you just mentioned 0:05:26.240 --> 0:05:30.520 about China embracing free markets but not democracy, how you 0:05:30.560 --> 0:05:34.360 think about that relationship. Well, I don't want to get 0:05:34.400 --> 0:05:37.120 too deep and dark here, but if you if you 0:05:37.160 --> 0:05:40.479 think about the Chinese ability as an autocracy, as a 0:05:40.480 --> 0:05:44.839 totalitarian regime to absorb the sort of punishment that a 0:05:45.040 --> 0:05:48.920 future sanctions or blockade regime might impose on it, it 0:05:48.960 --> 0:05:51.320 doesn't care about human life in the same way that 0:05:51.520 --> 0:05:55.680 Americans do, right and so, and that Europeans do. That's 0:05:55.720 --> 0:05:58.719 not to say that your average Chinese individual or Chinese 0:05:58.720 --> 0:06:01.479 household doesn't care about if I'm talking about the government, 0:06:01.520 --> 0:06:04.839 to be clear, and so, PRC, I think we'll be 0:06:04.880 --> 0:06:07.599 able to pull things out of the bag in a 0:06:07.600 --> 0:06:11.800 future confrontation that look more like and feel more like 0:06:11.880 --> 0:06:15.920 an autarchy, a strategic autarchy, for which I suspect Belton 0:06:16.000 --> 0:06:18.800 Road has a pretty good preparation in many ways that 0:06:19.240 --> 0:06:21.960 probably surprise us. And so really the question is to 0:06:22.000 --> 0:06:27.200 what extent can European economies and the American economy withstand 0:06:27.320 --> 0:06:30.200 a direct economic confrontation. I mean, I've said it before, 0:06:30.240 --> 0:06:33.120 maybe we need some sort of strategic garden furniture reserve. 0:06:33.200 --> 0:06:35.760 You know, it's a silly way of putting it, but 0:06:35.800 --> 0:06:39.120 we're on the hook. No, that is a really, really 0:06:39.160 --> 0:06:41.039 good point, and it's interesting you know, we had a 0:06:41.040 --> 0:06:44.159 great story out from our Bloomberg team about what the 0:06:44.279 --> 0:06:48.360 UK government basically was doing and kind of doing a 0:06:48.360 --> 0:06:53.960 disaster scenario if China invaded Taiwan and TSMC was shut 0:06:53.960 --> 0:06:56.400 down or impacted the global supply chain, as we know 0:06:56.480 --> 0:06:58.960 that they produce so many what is it, ninety percent 0:06:58.960 --> 0:07:01.120 of the chips used in the world. So I guess 0:07:01.680 --> 0:07:04.680 I always think about what's the constructive conversation as all 0:07:04.680 --> 0:07:08.000 this stuff is going on, where investment strategist ed continue 0:07:08.040 --> 0:07:10.880 to say that the big concerns this year are geopolitical. 0:07:11.400 --> 0:07:13.320 You know, we're seeing that. So what is the constructive 0:07:13.360 --> 0:07:15.400 and we've only got about forty five seconds left here. 0:07:15.680 --> 0:07:18.000 The constructive answer from Taiwan is don't worry about it 0:07:18.120 --> 0:07:22.080 right now. Ergo's best sources have the prospect of an 0:07:22.120 --> 0:07:25.120 invasion at a very very low chance. That's for all 0:07:25.160 --> 0:07:27.080 sorts of reasons that we can get into another day. 0:07:27.320 --> 0:07:32.080 But do expect some kind of disruption, something stopping short 0:07:32.160 --> 0:07:34.080 of a blockade, because of course that's an act of war. 0:07:34.280 --> 0:07:37.760 But do expect that the PRC and the Communist Party 0:07:37.760 --> 0:07:40.360 in China are going to make life more difficult in 0:07:40.400 --> 0:07:44.080 that region. Still worried about Russia. I'm always worried about Russia. Yeah, 0:07:44.360 --> 0:07:45.960 I'm always worried about Russia. But I think we're on 0:07:46.080 --> 0:07:48.480 top and I think Ukrainians will win. All right, listen, 0:07:48.520 --> 0:07:50.360 great to check in with you. I know it's busy 0:07:50.360 --> 0:07:52.280 on your end as well, So thanks for carving out 0:07:52.280 --> 0:07:55.480 some time. Ed Price, his principle at Ergo, former British 0:07:55.520 --> 0:07:59.880 trade official and of course joining us via zoom here. 0:08:00.160 --> 0:08:03.040 I believe it was in New York City. You're listening 0:08:03.080 --> 0:08:06.920 to the Bloomberg Business Week podcast. Got us live weekdays 0:08:06.960 --> 0:08:09.960 from two to five pm Easter on Bloomberg Radio, The 0:08:10.000 --> 0:08:13.119 Bloomberg Business a band you two. You can also listen 0:08:13.240 --> 0:08:16.760 live to our flagship New York station, Just Say Alexa 0:08:17.000 --> 0:08:20.880 play Bloomberg, Eleve and Dirty. As we all know, we're 0:08:21.080 --> 0:08:23.600 nearing that one year mark since the Russian invasion of 0:08:23.720 --> 0:08:27.600 Ukraine and as Ukrainians continue to fight to defend their country, 0:08:27.800 --> 0:08:31.600 the continued war requires tapping into a vast donor network 0:08:31.840 --> 0:08:34.960 that's blossomed over the plast twelve months to supply soldiers 0:08:34.960 --> 0:08:38.199 with everything from boots to battle tanks. Carol, Yeah, we're 0:08:38.200 --> 0:08:41.000 talking crowdfunding. Who knew, well, our Mark Champion knew this story, 0:08:41.000 --> 0:08:43.160 By the way, is Today's Bloomberg Big Take. It is 0:08:43.200 --> 0:08:45.800 one of our most read stories on the Bloomberg. As 0:08:45.800 --> 0:08:48.600 we said, it is also Today's Big Take podcast, which 0:08:48.600 --> 0:08:50.800 you can find up Bloomberg dot com or wherever you 0:08:50.840 --> 0:08:53.040 get your podcasts, and be sure to not miss the 0:08:53.040 --> 0:08:55.839 Big Take on Bloomberg Radio. That's weeknights at eleven pm 0:08:55.840 --> 0:08:58.839 Wall Street Time. Mark Champion, Bloomberg News Senior reporter for 0:08:59.000 --> 0:09:02.560 International Affairs, who wrote the story, He is in London, Mark, 0:09:02.679 --> 0:09:05.800 incredible story. Like I said, who knew it. It's kind 0:09:05.800 --> 0:09:09.360 of a form of crowdfunding. Tell us what exactly is 0:09:09.400 --> 0:09:13.520 going on? Yes, well, I've been going in and out 0:09:13.559 --> 0:09:18.120 of Ukraine for the last year and it really struck 0:09:18.160 --> 0:09:22.160 me every time I went the amount of just stuff 0:09:22.240 --> 0:09:26.000 that was getting uh, you know, provided to the front. 0:09:26.040 --> 0:09:28.600 Wherever you were. You went into a company, they had 0:09:28.600 --> 0:09:31.679 a warehouse full of stuff and it was all donated. 0:09:32.480 --> 0:09:35.080 And the more I know was there, the more it 0:09:35.120 --> 0:09:37.080 became clear that this isn't just you know, the normal 0:09:37.080 --> 0:09:39.440 stuff you'd expect about, you know, food for refugees and 0:09:39.480 --> 0:09:42.520 some but it was also weapons for the front, cars 0:09:42.559 --> 0:09:45.880 for the front, everything that you can imagine that. You know, 0:09:46.080 --> 0:09:48.880 people just all have relatives there. Their sons and brothers 0:09:48.880 --> 0:09:50.880 and fathers are all at the front, and they were 0:09:50.880 --> 0:09:53.040 trying to find the stuff that they said they needed, 0:09:53.440 --> 0:09:56.440 and so they're filling all the gaps. But the scale 0:09:56.559 --> 0:10:00.040 has become really enormous. So you know, the one a 0:10:01.360 --> 0:10:04.600 fund in particular that I talked to call come Back Alive, 0:10:04.960 --> 0:10:07.079 they raised one hundred and sixty million in the last 0:10:07.160 --> 0:10:11.360 dollars in the last year. You know, there's others of 0:10:11.440 --> 0:10:14.280 similar scale. The Central Bank, if you want to just 0:10:14.360 --> 0:10:17.680 give extra money, the Defense Ministry Central Bank has raised 0:10:17.679 --> 0:10:20.920 six hundred and fifty million dollars. And you know that 0:10:21.760 --> 0:10:26.199 beyond those funds, which they are funding sort of expensive 0:10:26.200 --> 0:10:29.640 million dollar drones and mortars and all sorts of things 0:10:29.679 --> 0:10:32.640 like that. But beyond those funds, you just have the 0:10:32.760 --> 0:10:36.280 tiniest little operations all over the place. You know, one 0:10:36.320 --> 0:10:38.760 place I went to was a guy as a former 0:10:38.840 --> 0:10:41.640 graffiti artist who decided he was just going to help 0:10:41.679 --> 0:10:42.959 all his friends who were going to the front, and 0:10:42.960 --> 0:10:45.800 they were taking their cars and he camouflaged them so 0:10:45.840 --> 0:10:49.000 he cannot now as camouflage you know around you know, 0:10:49.040 --> 0:10:52.960 eighteen hundred vehicles and then also rifles and all sorts 0:10:53.000 --> 0:10:56.200 of things. That's so, that's such an interesting point. I 0:10:56.240 --> 0:10:58.120 wonder if that means that there's a sense on the 0:10:58.160 --> 0:11:01.280 ground that the folks who are respondable for the crowdfunding 0:11:01.679 --> 0:11:04.439 understand the needs of civilians in the area in a 0:11:04.480 --> 0:11:07.440 way that maybe the big players like the US funders 0:11:08.280 --> 0:11:12.400 don't necessarily understand. Was that your impression, Mark, Yeah, I 0:11:12.400 --> 0:11:14.360 think that's true. I mean there's just a lot of 0:11:14.520 --> 0:11:17.440 you know, gaps to fill, and you know, the US 0:11:17.600 --> 0:11:20.440 can't be on top of all of that. The Ukrainian 0:11:20.480 --> 0:11:23.119 Defense Ministry, you know, for reasons of money, of bureaucracy 0:11:23.200 --> 0:11:26.840 or whatever, it can't do everything. And you know, these 0:11:27.200 --> 0:11:29.840 is just something that Ukrainian has become very used to. Um. 0:11:30.000 --> 0:11:33.520 They because they had very sort of inefficient and corrupt governments, 0:11:33.520 --> 0:11:36.480 they became, uh, you know, over more than a decade, 0:11:36.480 --> 0:11:39.160 they've built up this sort of instinct to crowdfund no 0:11:39.160 --> 0:11:41.840 matter what it is. You know, a popular uprising like 0:11:41.960 --> 0:11:45.160 the Maidan protests in twenty fourteen. Well, then when the 0:11:45.200 --> 0:11:49.920 war began in the donbas in twenty fourteen fifteen, immediately 0:11:50.000 --> 0:11:53.000 the first instinct is not to ask the government, you know, 0:11:53.040 --> 0:11:54.960 because you don't think you'll get anything the government. If 0:11:54.960 --> 0:11:57.120 you give anything that the government, you think it will disappear. 0:11:57.440 --> 0:12:00.199 So people have just become used to doing stuff themselves. 0:12:00.200 --> 0:12:03.400 They just instantly do it, and they just instantly begin 0:12:03.520 --> 0:12:05.640 Facebook groups and so on to say, let's get a 0:12:05.679 --> 0:12:07.640 car for so and so so that he can go 0:12:07.679 --> 0:12:11.199 to the front. So it's it's just really ingrained, and 0:12:11.240 --> 0:12:14.199 I think it is actually more important than the dollar value, 0:12:14.440 --> 0:12:17.600 simply because it says to every soldier at the front um, 0:12:17.760 --> 0:12:21.960 you know, I've got an entire society behind me. Talk 0:12:22.000 --> 0:12:23.839 to us about some of the people behind some of 0:12:23.880 --> 0:12:27.800 these Crown crowdfunding efforts. We're talking about what Hollywood celebrities 0:12:27.800 --> 0:12:34.120 were talking about, oligarchs, we're talking about everybody. Yeah, absolutely, So, 0:12:34.280 --> 0:12:37.400 you know the fund that was set up by the president, 0:12:37.679 --> 0:12:41.560 President Celenski, he has one called United twenty four and 0:12:41.640 --> 0:12:45.880 they've raised two hundred and eighty seven million dollars. And 0:12:45.960 --> 0:12:49.080 for that fund, he has really reached out and he's 0:12:49.920 --> 0:12:52.800 persuaded by b Streisan to be an ambassador the fund. 0:12:53.120 --> 0:12:55.440 There's a number of other celebrities that have become attached 0:12:55.480 --> 0:12:57.800 to the fund in one way or another and so 0:12:57.840 --> 0:13:02.160 they raise money. And then you have others who are 0:13:03.000 --> 0:13:04.840 as you mentioned the oligarchs. You know, some of the 0:13:04.840 --> 0:13:07.920 oligarchs who are not very popular, and we're even seen, 0:13:08.120 --> 0:13:10.319 you know, some years ago as being kind of pro 0:13:10.440 --> 0:13:15.120 Russian because they supported the party that former president Janakovic 0:13:15.640 --> 0:13:20.640 used to you know, represent So you know Aria Ahmetze, 0:13:20.720 --> 0:13:24.160 who's the richest man in Ukraine. He has a big 0:13:24.200 --> 0:13:26.400 steel company called met in Best. They owned as a 0:13:26.520 --> 0:13:30.120 style in Mariupol. The steel plant where they were the 0:13:30.200 --> 0:13:33.800 last stand was made in Mariupol. They've lost a lot 0:13:33.840 --> 0:13:37.000 of their assets, but he has actually provided one hundred 0:13:37.040 --> 0:13:40.840 and fifty thousand sets of bulletproof vests which they've made 0:13:40.840 --> 0:13:45.040 in his factories, you know, eighty thousand tank traps, all 0:13:45.160 --> 0:13:48.960 kinds of stuff which really does mount up. Well, Carol, 0:13:49.120 --> 0:13:51.160 you bring up a great question about the people who 0:13:51.440 --> 0:13:54.080 fund this effort and who have kind of been the 0:13:54.160 --> 0:13:55.960 leaders behind it. I wonder Mark, if you can talk 0:13:56.000 --> 0:13:59.160 about the people who are most impacted by it? Is 0:13:59.200 --> 0:14:02.520 this civilian Is it folks who are actually fighting, Who 0:14:02.720 --> 0:14:06.840 is most benefiting from this extra cash? Well, it really 0:14:06.960 --> 0:14:11.080 is everybody, but the Ukrainians are focused very much, you know, 0:14:11.280 --> 0:14:16.000 on people who remain in areas that are either at 0:14:16.040 --> 0:14:19.200 the front or they're in areas that were occupied and 0:14:19.280 --> 0:14:23.520 were then retaken by the Ukrainians, and services there has 0:14:23.600 --> 0:14:27.560 sort of broken down. Medical services, you know, food is 0:14:27.600 --> 0:14:30.040 difficult to sort of distribute all those sorts of things. 0:14:30.080 --> 0:14:32.640 So basically, you know, as I say, it's it's the 0:14:32.800 --> 0:14:36.040 great strength of this is that it's incredibly flexible. It 0:14:36.120 --> 0:14:40.400 just kind of responds because everybody knows somebody and they 0:14:40.720 --> 0:14:43.720 then move into these areas and provide services that the 0:14:43.760 --> 0:14:46.920 government is just you know, incapable or too slow or 0:14:47.040 --> 0:14:49.920 you know, doesn't have the resources to do. And it 0:14:50.320 --> 0:14:54.720 really is a kind of lifesaver in these areas. It 0:14:54.880 --> 0:14:57.280 is for civilians, it's but a lot of it is 0:14:57.320 --> 0:15:00.680 for the front, for the soldiers U. It's interesting too, 0:15:00.680 --> 0:15:02.800 and it's funny, you know, Mark, as we were getting 0:15:02.800 --> 0:15:05.640 ready and talking about your story in the newsroom, one 0:15:05.640 --> 0:15:07.600 of the things that came up from one of our producers, 0:15:07.720 --> 0:15:09.400 Aria Gami, he said, you know, wait a minute, I 0:15:09.560 --> 0:15:13.360 understand the US is sending billions of dollars in equipment 0:15:13.440 --> 0:15:16.480 and providing support. We know, other nations and allies of 0:15:16.520 --> 0:15:19.880 the US are certainly, and of Ukraine are providing support. 0:15:21.200 --> 0:15:26.080 Why is this ultimately necessary? Because nothing is enough. I mean, 0:15:26.520 --> 0:15:28.760 this is a big war. We haven't seen a war 0:15:28.840 --> 0:15:32.080 like this since World War Two in terms of pure intensity. 0:15:32.200 --> 0:15:34.160 I mean they have been other very intense wars, but 0:15:34.280 --> 0:15:37.560 not like this. And you know, the Russian side in 0:15:37.600 --> 0:15:41.720 particular is very well armed. It has the entires, you know, 0:15:42.000 --> 0:15:45.480 not the entire so the predominant part of the stocks 0:15:45.520 --> 0:15:47.960 of the former Soviet Union that it built up for 0:15:47.960 --> 0:15:50.720 the Cold War, and in many ways this is you know, 0:15:50.760 --> 0:15:53.640 they're running down through the Cold War stocks of the 0:15:53.640 --> 0:15:56.760 former Soviet Union. The Ukrainians on the other side, you know, 0:15:56.800 --> 0:15:59.160 they're still he starts at this war with around sixteen 0:15:59.240 --> 0:16:02.040 hundred tanks. You know, Germany has three hundred. You know, 0:16:02.200 --> 0:16:05.000 Britain has two hundred and twenty. So it's you know, 0:16:05.040 --> 0:16:07.640 they they it's not like they had nothing. But you 0:16:07.760 --> 0:16:11.680 need so much in order to pursue a warline there. 0:16:12.000 --> 0:16:16.240 It just eats resources at an incredible rate, and you 0:16:16.280 --> 0:16:19.480 need a lot of everything because it gets destroyed. You know, 0:16:19.520 --> 0:16:23.240 the ninety percent of drones get destroyed. A lot you know, 0:16:23.360 --> 0:16:26.040 pickup trucks that people bring they get destroyed, either you know, 0:16:26.080 --> 0:16:27.720 because they get hit, or they just you know, in 0:16:27.720 --> 0:16:29.960 an accidents, or they just you know, get stuck in 0:16:30.040 --> 0:16:33.920 mud or whatever. That it just eats through resources at 0:16:33.960 --> 0:16:36.880 an incredible rate. And to be fair, we've talked about 0:16:36.920 --> 0:16:39.720 the new double issue Bloomberg Business Week gets out cover 0:16:39.800 --> 0:16:43.280 story is of course marking the one year Russian invasion 0:16:43.800 --> 0:16:47.160 into Ukraine, but talks about, you know, specifically, Maddie, the 0:16:47.200 --> 0:16:50.840 shortage of ammunition on both sides. I mean, both sides 0:16:50.880 --> 0:16:52.840 are going through a lot when it comes to any 0:16:52.920 --> 0:16:55.240 kind of defense equipment, and they're just kind of running 0:16:55.240 --> 0:16:57.840 through it. Yeah, and it's it's so critical. I wonder Mark, 0:16:57.840 --> 0:16:59.880 in our final kind of thirty seconds with you here, 0:17:00.040 --> 0:17:02.560 if you can talk about you mentioned the intensity of 0:17:02.560 --> 0:17:05.040 the war. What is something that you understand about the 0:17:05.040 --> 0:17:07.520 situation on the ground that folks who haven't been in 0:17:07.680 --> 0:17:12.000 Ukraine might be missing about the story. Well, I think 0:17:12.000 --> 0:17:14.480 when you hear that the war has slowed down in 0:17:14.520 --> 0:17:18.160 the East and yet you hit, then the casualty rates 0:17:18.160 --> 0:17:22.040 are really high. That is simply about intensity. So they 0:17:22.080 --> 0:17:24.399 may not be moving, but there is a lot of 0:17:24.520 --> 0:17:27.520 artillery shells that are just being exchanged on either side 0:17:27.680 --> 0:17:30.080 and bodies now at this part of the war, just 0:17:30.240 --> 0:17:32.440 bodies on the Russian side being thrown at the war. 0:17:32.840 --> 0:17:34.920 So when you hear that things were to nothing's moved 0:17:35.000 --> 0:17:38.440 or slow, it doesn't mean that the war has itself 0:17:38.440 --> 0:17:41.240 has slowed down in terms of intensity, and it hasn't 0:17:41.280 --> 0:17:44.000 at all. Yeah, it's pretty amazing though, and to think 0:17:44.000 --> 0:17:46.439 about it was just a year ago then it all started. 0:17:46.480 --> 0:17:48.840 But you look at how much devastation and how many 0:17:48.880 --> 0:17:53.200 resources are still needed to continue on Mark Champion Incredible story, 0:17:53.359 --> 0:17:56.359 Marks Senior reporter for International Affairs at Bloomberg News, joining 0:17:56.400 --> 0:17:58.600 us on the phone from London. Be sure to check 0:17:58.640 --> 0:18:01.119 out his Bloomberg Big Take. Can also find it on 0:18:01.200 --> 0:18:03.720 the Bloomberg Terament. Of course, check out the Bloomberg Big 0:18:03.720 --> 0:18:06.320 Take on Bloomberg Radio weeknights at eleven pm in all 0:18:06.320 --> 0:18:13.200 street time, you're listening to the Bloomberg Business Week podcast. 0:18:13.520 --> 0:18:16.320 Catch us live weekdays from two to five pm Easter 0:18:16.560 --> 0:18:20.240 on Bloomberg Radio, the Bloomberg Business Band You Two. You 0:18:20.320 --> 0:18:23.320 can also listen live to our flagship New York station, 0:18:23.680 --> 0:18:28.720 Just Say Alexa, play Bloomberg Eleve and Dirty. Well you 0:18:28.720 --> 0:18:30.959 know what, Maddie, we had some data out earlier this 0:18:31.000 --> 0:18:33.400 morning we talked about with Scarlett and Romain. It talks 0:18:33.440 --> 0:18:37.480 specifically about output at US factories up the most in January, 0:18:37.800 --> 0:18:40.960 by the largest amount in early a year. So we're 0:18:41.000 --> 0:18:44.720 talking about improving supply chains, firm or demand getting and 0:18:44.800 --> 0:18:47.320 giving some relief, if you will, to what's been a 0:18:47.359 --> 0:18:50.600 really challenged manufacturing sector. So much needed relief after the 0:18:50.600 --> 0:18:53.080 past couple of years of supply chain shocks. Right, it's 0:18:53.119 --> 0:18:54.800 been crazy. Right, We're just talking a little bit about 0:18:54.800 --> 0:18:58.199 Cisco and the manufacturing and the backlogs just in general. 0:18:58.720 --> 0:19:01.840 We want to get to our next guests. Mattive Holdings 0:19:01.960 --> 0:19:04.679 is a publicly held company. It's got about a one 0:19:04.720 --> 0:19:06.600 and a half billion dollar market cap. It makes and 0:19:06.680 --> 0:19:11.560 sell specialty materials for manufactory two customers in more than 0:19:11.560 --> 0:19:13.879 a hundred countries, so it's got a great global perspective. 0:19:14.160 --> 0:19:17.320 Julie Chartel is the presidency of the company. Just ringing 0:19:17.359 --> 0:19:19.679 the closing bell at the New York Stock Exchange and 0:19:19.720 --> 0:19:21.800 that's where we find our via Zoom. Julie, good to 0:19:21.800 --> 0:19:25.800 have you here on Bloomberg BusinessWeek on Bloomberg Radio. First 0:19:25.840 --> 0:19:28.639 of all, tell us a little bit about your customers, 0:19:28.680 --> 0:19:31.600 your business and what vantage point that gives you when 0:19:31.640 --> 0:19:35.880 it comes to manufacturing and the economic outlook. Sure, thank 0:19:35.880 --> 0:19:37.920 you for having me today. It's a real honor and 0:19:38.000 --> 0:19:40.160 privilege to be here at the New York Stock Exchange 0:19:40.160 --> 0:19:42.840 and it marks a key milestone formative as a specialty 0:19:42.880 --> 0:19:46.480 materials company. We're you've created through the merger of two 0:19:46.600 --> 0:19:51.119 former specialty materials companies MINA and SWM, and so combined, 0:19:51.200 --> 0:19:54.439 it's a really powerful statement that we're making into the market. 0:19:54.480 --> 0:19:58.560 We have complementary technologies that we sell into a diverse 0:19:59.119 --> 0:20:03.400 area of different categories, whether that's filtration media for cleaner 0:20:03.440 --> 0:20:06.639 air and water and the strong macro trends behind those things. 0:20:07.040 --> 0:20:12.040 It's release liners and applications for medical packaging and its 0:20:12.040 --> 0:20:15.600 tapes and abrasives. Into the industrial space as well, we've 0:20:15.600 --> 0:20:18.399 seen great strength and really a supply chain that is 0:20:18.440 --> 0:20:20.679 starting to improve, and that's a great spot to be 0:20:20.720 --> 0:20:24.400 in as a manufacturer. How would you describe the overall 0:20:24.480 --> 0:20:27.840 manufacturing environment today and what does that tell us about 0:20:27.920 --> 0:20:30.800 our overall economy. What's kind of an insight that you 0:20:30.920 --> 0:20:33.920 have because of your work in manufacturing that the rest 0:20:33.920 --> 0:20:37.320 of us might not. I think It's interesting because it's 0:20:37.320 --> 0:20:39.480 a little bit of a dichotomy. We are seeing, you know, 0:20:39.520 --> 0:20:42.159 the supply chains start to right size after what I 0:20:42.160 --> 0:20:45.760 would say is two years of challenges in our supply 0:20:45.880 --> 0:20:49.720 chain in manufacturing, whether that's driven by the rising interest rates, 0:20:49.880 --> 0:20:53.240 record levels of inflation, the Ukraine War, some of the 0:20:53.280 --> 0:20:56.359 conflicts in China, or some of the outcomes of COVID 0:20:56.400 --> 0:20:58.720 in China. We're starting to see that settle in and 0:20:58.760 --> 0:21:01.160 so our supply chain is opening up a bit, loosening 0:21:01.200 --> 0:21:03.440 up a bit, and that's really important for our customers. 0:21:03.480 --> 0:21:06.160 It means we're able to get back to a service 0:21:06.240 --> 0:21:09.880 level and predictability and lead time that is most valuable 0:21:09.920 --> 0:21:12.040 to them. And I think what we really recognize as 0:21:12.080 --> 0:21:15.440 manufacturers is it's important to have a global supply chain, 0:21:15.600 --> 0:21:18.680 but it's really important to have local supply because during 0:21:18.720 --> 0:21:22.600 this time, supply and availability became the number one priority 0:21:22.640 --> 0:21:25.280 for all of our customers. Hey, Julie, two questions, So 0:21:25.320 --> 0:21:27.480 are you back, Are the supply chains back to where 0:21:27.480 --> 0:21:30.520 we were pre pandemic and all of the bottlenecks, And secondly, 0:21:30.600 --> 0:21:34.359 you talk about local supply chains, are we seeing more 0:21:34.400 --> 0:21:38.280 and more companies tap into that change? Their supply chains, 0:21:38.359 --> 0:21:40.560 make sure that they're kind of in their backyard. So 0:21:40.600 --> 0:21:42.400 if you could address those two things, that would be great. 0:21:43.480 --> 0:21:46.879