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 --> 00:00:22,000
Speaker 1: on Apple CarPlay or Android Auto with the Bloomberg Business app.

4
00:00:22,360 --> 00:00:25,680
Speaker 1: Listen on demand wherever you get your podcasts, or watch

5
00:00:25,760 --> 00:00:27,160
Speaker 1: us live on YouTube.

6
00:00:27,440 --> 00:00:30,800
Speaker 2: Joining us right now for a brief I believe she

7
00:00:30,880 --> 00:00:34,279
Speaker 2: isn't shut down right now, She's started to trace data questions.

8
00:00:34,560 --> 00:00:36,960
Speaker 2: Joined us as well in the blur of all this,

9
00:00:37,280 --> 00:00:41,440
Speaker 2: in the articles, the rumors, the gossip, Henrietta, what are

10
00:00:41,479 --> 00:00:43,159
Speaker 2: you focused on today?

11
00:00:44,640 --> 00:00:48,880
Speaker 3: Coome Oneing guys, I really am focused on the two senators,

12
00:00:49,000 --> 00:00:52,840
Speaker 3: Leader thone and Leader Schumer. The reality is, of all

13
00:00:52,920 --> 00:00:55,480
Speaker 3: the operators in DC right now, they're the only ones

14
00:00:55,520 --> 00:00:59,880
Speaker 3: that actually have the physical requirement to be Bipartisanan's going

15
00:00:59,920 --> 00:01:03,400
Speaker 3: to anywhere between ten and twenty Democratic votes to keep

16
00:01:03,560 --> 00:01:06,280
Speaker 3: his chamber open and the government open. And I think

17
00:01:06,319 --> 00:01:09,119
Speaker 3: that means those two are the most important people in

18
00:01:09,160 --> 00:01:09,520
Speaker 3: the room.

19
00:01:09,680 --> 00:01:11,640
Speaker 4: I look forward to them getting together at some point.

20
00:01:11,760 --> 00:01:14,120
Speaker 2: The Shoomer have the Democrats behind him or does they

21
00:01:14,120 --> 00:01:15,199
Speaker 2: need to watch us back?

22
00:01:16,200 --> 00:01:18,399
Speaker 3: I mean, to the extent that Democrats can line up

23
00:01:18,440 --> 00:01:22,880
Speaker 3: behind anybody. Right now, I think Schumer is moving forward

24
00:01:22,959 --> 00:01:26,800
Speaker 3: knowing that we're he to divert course and just cave

25
00:01:27,120 --> 00:01:27,520
Speaker 3: right now.

26
00:01:27,560 --> 00:01:28,720
Speaker 4: That would be disastrous.

27
00:01:28,920 --> 00:01:31,559
Speaker 3: So the base of the party is pushing him towards

28
00:01:31,560 --> 00:01:34,920
Speaker 3: his shutdown. Same especially with the House side. There's a

29
00:01:34,959 --> 00:01:38,000
Speaker 3: real disparity between House and Senate staff right now, where

30
00:01:38,000 --> 00:01:40,200
Speaker 3: House members are gung ho on a shutdown and the

31
00:01:40,240 --> 00:01:44,040
Speaker 3: Senators are more hopeful that we can keep things open.

32
00:01:44,080 --> 00:01:47,080
Speaker 3: But that's the usual dynamic. The House is a more

33
00:01:47,480 --> 00:01:48,639
Speaker 3: rebel rouse sea bunch.

34
00:01:50,000 --> 00:01:52,919
Speaker 5: Your odds right now are seventy percent that the government

35
00:01:53,000 --> 00:01:57,240
Speaker 5: will shut down in midnight September thirtieth. If that happens, Henriette,

36
00:01:57,760 --> 00:02:01,600
Speaker 5: is it worth ascribing blamed one party? Does any party care?

37
00:02:03,760 --> 00:02:06,200
Speaker 4: I think that will play the blame game.

38
00:02:06,280 --> 00:02:08,720
Speaker 3: You can see the polling shows that Republicans are going

39
00:02:08,760 --> 00:02:10,840
Speaker 3: to blame Democrats, Diesel blame ours.

40
00:02:11,000 --> 00:02:12,760
Speaker 4: Independents are relatively split.

41
00:02:12,880 --> 00:02:16,000
Speaker 3: But the bottom line is the majority party is the

42
00:02:16,040 --> 00:02:18,360
Speaker 3: Republican Conference. They own the House, the Senate, and the

43
00:02:18,360 --> 00:02:22,400
Speaker 3: White House. So shutting down is going to require bipartisanship.

44
00:02:22,400 --> 00:02:25,200
Speaker 3: Out of the Senate, that means that the senators are

45
00:02:25,200 --> 00:02:26,519
Speaker 3: the ones that are most important.

46
00:02:27,480 --> 00:02:29,600
Speaker 4: I think Democrats are.

47
00:02:29,560 --> 00:02:31,760
Speaker 3: Going to be really upset unless they get some sort

48
00:02:31,800 --> 00:02:34,440
Speaker 3: of a concession. And this time Schumer's illustrating that they're

49
00:02:34,480 --> 00:02:36,520
Speaker 3: not going to fold the way that they usually do,

50
00:02:36,600 --> 00:02:39,400
Speaker 3: and they're deciding that healthcare subsidies are really the fight

51
00:02:39,520 --> 00:02:42,360
Speaker 3: to stand on right now. What's interesting to me is

52
00:02:42,360 --> 00:02:45,480
Speaker 3: that they're not migrating to any of the broader issues

53
00:02:45,520 --> 00:02:48,920
Speaker 3: with the Trump administration, especially the one that's most impactful

54
00:02:48,960 --> 00:02:51,880
Speaker 3: in polling data to the American public, which is opposition

55
00:02:52,000 --> 00:02:56,480
Speaker 3: to the tariffs, that is widespread inflation prices, the economy,

56
00:02:56,560 --> 00:02:59,639
Speaker 3: or where Trump is now polling materially underwater, which is

57
00:02:59,639 --> 00:03:03,320
Speaker 3: a face from his election win. And I think that's

58
00:03:03,320 --> 00:03:06,240
Speaker 3: something that the Democratic Party could very easily seize upon.

59
00:03:06,480 --> 00:03:09,960
Speaker 3: But they're not doing that. They're focusing solely on healthcare.

60
00:03:10,840 --> 00:03:14,960
Speaker 5: So if we get a shutdown, is there expectation how

61
00:03:15,000 --> 00:03:16,760
Speaker 5: long it may last? Is this going to be something

62
00:03:16,800 --> 00:03:18,000
Speaker 5: that people are going to really feel?

63
00:03:19,000 --> 00:03:20,440
Speaker 4: Yeah, that's a good question, I would say.

64
00:03:20,480 --> 00:03:22,400
Speaker 3: As a former staffer, I know that you get paid

65
00:03:22,400 --> 00:03:26,000
Speaker 3: every other Friday, and so there is a seven hundred

66
00:03:26,000 --> 00:03:29,280
Speaker 3: and fifty thousand person furlough announcement that's going to go

67
00:03:29,320 --> 00:03:31,560
Speaker 3: out and a lot of those folks are paid every

68
00:03:31,600 --> 00:03:35,240
Speaker 3: other Friday, so it might sound trite, but for a

69
00:03:35,280 --> 00:03:37,720
Speaker 3: lot of these members, these are there individual staffers, and

70
00:03:37,720 --> 00:03:39,560
Speaker 3: if they're going to miss a pace cycle on Friday,

71
00:03:39,560 --> 00:03:43,400
Speaker 3: October tenth, that becomes a problem, especially Saturday, Sunday, Monday,

72
00:03:43,560 --> 00:03:45,440
Speaker 3: when they've now gone three days without a pay stump.

73
00:03:45,480 --> 00:03:48,120
Speaker 3: And we're not high paid workers up on the hills.

74
00:03:48,200 --> 00:03:51,240
Speaker 3: So it's not just those guys, it's people across the country.

75
00:03:51,320 --> 00:03:53,400
Speaker 4: You know, it's national Henry.

76
00:03:53,600 --> 00:03:55,880
Speaker 2: This came up this weekend. Let me just ask it,

77
00:03:55,920 --> 00:04:00,280
Speaker 2: with great respect for your encyclopedic knowledge of Capital Hill.

78
00:04:01,080 --> 00:04:05,160
Speaker 2: Are we running a parliamentary government? Is it really? Prime

79
00:04:05,200 --> 00:04:06,080
Speaker 2: Minister Trump?

80
00:04:07,720 --> 00:04:10,160
Speaker 3: Yeah, I mean I think the president we if and

81
00:04:10,200 --> 00:04:12,680
Speaker 3: when we shut down. The difference here is that he

82
00:04:12,760 --> 00:04:17,440
Speaker 3: has demonstrated a clear willingness to use his authority to

83
00:04:17,680 --> 00:04:19,720
Speaker 3: any extreme that he can come up with, and Russ

84
00:04:19,760 --> 00:04:22,920
Speaker 3: Bott is reportedly having the time of his life right now.

85
00:04:23,120 --> 00:04:26,760
Speaker 3: I think the shutdown, the fact that Congress has ceded

86
00:04:27,080 --> 00:04:30,800
Speaker 3: control and authority over taxation is wild. And indeed, the

87
00:04:30,800 --> 00:04:33,400
Speaker 3: Trump administration even made the argument to the Supreme Court

88
00:04:33,440 --> 00:04:37,560
Speaker 3: recently that by not voting to repeal the president's International

89
00:04:37,600 --> 00:04:41,360
Speaker 3: Economic Emergency power tariffs. They were actually giving him the

90
00:04:41,400 --> 00:04:44,760
Speaker 3: authority to tariff or to tax the American public and

91
00:04:45,040 --> 00:04:46,720
Speaker 3: correct me if I'm wrong, but I'm pretty sure we

92
00:04:46,800 --> 00:04:47,920
Speaker 3: fought the British over this one.

93
00:04:48,080 --> 00:04:48,279
Speaker 2: Phil.

94
00:04:48,520 --> 00:04:48,960
Speaker 6: Yeah.

95
00:04:49,040 --> 00:04:52,840
Speaker 2: Yeah, it started in Brooklyn andreetta give us some sense

96
00:04:52,880 --> 00:04:56,599
Speaker 2: of admirals and generals flying in to meet, and I

97
00:04:56,600 --> 00:04:59,000
Speaker 2: guess now the President is going to show up as well,

98
00:04:59,400 --> 00:05:02,000
Speaker 2: discuss it.

99
00:05:02,040 --> 00:05:05,280
Speaker 3: Seems like a pretty good campaign video to me.

100
00:05:05,800 --> 00:05:07,680
Speaker 4: My understanding is that it's going to be recorded.

101
00:05:07,839 --> 00:05:12,960
Speaker 3: It's going to be you know, workshops, photoshopped, photop set out.

102
00:05:13,240 --> 00:05:15,640
Speaker 2: I saw one report that said it's a photo app.

103
00:05:15,680 --> 00:05:21,960
Speaker 2: You agree with that? Yes, all right, I guess this

104
00:05:22,040 --> 00:05:26,200
Speaker 2: is I feel like angry beaversa Nickelodeon. This is nuts.

105
00:05:26,279 --> 00:05:29,400
Speaker 2: This is not a trace. Thank you so much, greatly

106
00:05:29,480 --> 00:05:33,719
Speaker 2: appreciate it. Stay with us. More from Bloomberg Surveillance coming

107
00:05:33,800 --> 00:05:34,800
Speaker 2: up after this.

108
00:05:42,040 --> 00:05:45,640
Speaker 1: You're listening to the Bloomberg Surveillance podcast. Catch us live

109
00:05:45,680 --> 00:05:48,880
Speaker 1: weekday afternoons from seven to ten am Eastern Listen on

110
00:05:48,920 --> 00:05:52,599
Speaker 1: Applecarplay and Android Auto with the Bloomberg Business app, or

111
00:05:52,760 --> 00:05:54,240
Speaker 1: watch us live on YouTube.

112
00:05:54,480 --> 00:05:58,040
Speaker 2: Conversation of the Day for those clipping coupons, James karen Cio,

113
00:05:58,160 --> 00:06:02,520
Speaker 2: process of solutions, More Stanley. Okay, you walk in, you say, hey, stupid,

114
00:06:02,680 --> 00:06:05,159
Speaker 2: look at the five year total return on bonds. I

115
00:06:05,240 --> 00:06:09,080
Speaker 2: took a big index like bond fun flat. But if

116
00:06:09,120 --> 00:06:12,120
Speaker 2: you come in even three years you get a legit

117
00:06:12,320 --> 00:06:15,839
Speaker 2: six point eight percent total return. Where we're going to

118
00:06:15,839 --> 00:06:19,240
Speaker 2: be in twelve months if the marketing machine of Wall Street,

119
00:06:19,400 --> 00:06:22,640
Speaker 2: not including Morgan Stanley, is going to be saying, OMG,

120
00:06:22,880 --> 00:06:24,560
Speaker 2: bonds are great, do we need to get out in

121
00:06:24,600 --> 00:06:25,080
Speaker 2: front of that?

122
00:06:25,440 --> 00:06:26,520
Speaker 6: Bonds have always been great.

123
00:06:27,320 --> 00:06:29,960
Speaker 7: So the coupon on bonds today, what people talk about

124
00:06:30,000 --> 00:06:33,679
Speaker 7: as the all in yield, is actually reasonably decent today.

125
00:06:33,720 --> 00:06:36,640
Speaker 7: So you're getting about an investment grade credit. You're getting

126
00:06:36,640 --> 00:06:39,839
Speaker 7: about a five little bit more than a five percent yield.

127
00:06:39,839 --> 00:06:42,719
Speaker 7: If you put a portfolio together correctly, and if you

128
00:06:42,800 --> 00:06:45,120
Speaker 7: pick the right bonds, you might actually get a little

129
00:06:45,120 --> 00:06:46,800
Speaker 7: bit of total return on top of that. You could

130
00:06:46,800 --> 00:06:49,840
Speaker 7: be getting somewhere around six percent returns. What's wrong with that?

131
00:06:50,040 --> 00:06:51,760
Speaker 7: In the investment grade credit space?

132
00:06:51,839 --> 00:06:52,000
Speaker 2: Right?

133
00:06:52,040 --> 00:06:53,920
Speaker 7: If you add some high yield to that, you can

134
00:06:53,960 --> 00:06:55,080
Speaker 7: even get a little bit more.

135
00:06:55,480 --> 00:06:55,560
Speaker 2: So.

136
00:06:55,600 --> 00:06:57,520
Speaker 7: The bottom line is is that we do think that

137
00:06:57,560 --> 00:07:00,440
Speaker 7: default risks are going to be relatively low because we

138
00:07:00,520 --> 00:07:02,799
Speaker 7: do not have a very strong view for a recession.

139
00:07:02,839 --> 00:07:05,719
Speaker 7: We think recesion probabilities are low, so we're happy to

140
00:07:05,720 --> 00:07:09,880
Speaker 7: clip the all in coupon yield. But people will argue

141
00:07:09,920 --> 00:07:12,160
Speaker 7: that spreads are very tight, and they're right.

142
00:07:13,440 --> 00:07:16,520
Speaker 5: Spreads are tight, but they've been tight for a while here,

143
00:07:16,920 --> 00:07:19,800
Speaker 5: and the best performer in US fixed to come has

144
00:07:19,840 --> 00:07:22,480
Speaker 5: been US high yield. So what does that say about

145
00:07:22,800 --> 00:07:24,640
Speaker 5: I guess the markets wanting to take that credit risk.

146
00:07:24,760 --> 00:07:27,160
Speaker 7: So I always like to say that just because spreads

147
00:07:27,160 --> 00:07:29,480
Speaker 7: are tight is not a reason for them to widen.

148
00:07:29,680 --> 00:07:32,280
Speaker 7: There has to be a catalyst for these spreads to widen.

149
00:07:32,640 --> 00:07:35,520
Speaker 7: Spreads are going to naturally tighten as long as there's

150
00:07:35,560 --> 00:07:39,360
Speaker 7: not some bad news or recession or some geopolitical event

151
00:07:39,400 --> 00:07:42,320
Speaker 7: that comes through into the markets. But just because they're tight,

152
00:07:42,360 --> 00:07:44,480
Speaker 7: they can stay tight for a long period of time,

153
00:07:44,520 --> 00:07:46,320
Speaker 7: and I think sometimes that's what people mistake.

154
00:07:46,520 --> 00:07:50,960
Speaker 2: If they're tight, the yield of caring garbage to the

155
00:07:51,040 --> 00:07:55,600
Speaker 2: full faith in credit US can the US yields come down,

156
00:07:56,200 --> 00:07:59,520
Speaker 2: so that spreads indirectly widen.

157
00:08:00,640 --> 00:08:03,160
Speaker 6: So we would think that both happen at the same time.

158
00:08:03,200 --> 00:08:03,680
Speaker 6: As us.

159
00:08:04,200 --> 00:08:06,880
Speaker 7: They both come down, right, So I don't think there's

160
00:08:06,920 --> 00:08:09,680
Speaker 7: a lot more room for spreads to tighten. And when

161
00:08:09,720 --> 00:08:11,520
Speaker 7: we say spreads tightening, what we're meaning is that you're

162
00:08:11,520 --> 00:08:12,960
Speaker 7: getting the additional.

163
00:08:12,520 --> 00:08:14,720
Speaker 6: Total return out of your corporate.

164
00:08:14,320 --> 00:08:18,960
Speaker 7: Bonds relative to US treasuries, what we call the excess return.

165
00:08:19,160 --> 00:08:21,280
Speaker 7: We think that both are going to come down together.

166
00:08:21,360 --> 00:08:23,840
Speaker 7: So I think within fixed income, what you're looking to

167
00:08:23,880 --> 00:08:25,200
Speaker 7: get is the coupon these.

168
00:08:25,160 --> 00:08:29,840
Speaker 5: Days, Federal Reserve they cut rates once here, how do

169
00:08:29,880 --> 00:08:31,480
Speaker 5: you think the cadence is going to be here going

170
00:08:31,480 --> 00:08:32,080
Speaker 5: forward for them?

171
00:08:32,360 --> 00:08:34,439
Speaker 6: So I think it's two more times this year. January

172
00:08:34,480 --> 00:08:35,280
Speaker 6: is a possibility.

173
00:08:35,320 --> 00:08:37,880
Speaker 7: I think we end with the Fed funds policy rate

174
00:08:38,000 --> 00:08:40,400
Speaker 7: upper end of the band at three and a half percent.

175
00:08:41,559 --> 00:08:43,520
Speaker 7: I think there are a couple of things going on.

176
00:08:43,600 --> 00:08:46,720
Speaker 7: It's beyond just an insurance cut for labor. I think

177
00:08:46,760 --> 00:08:49,280
Speaker 7: some of it too, is also to address liquidity concerns

178
00:08:49,280 --> 00:08:50,200
Speaker 7: and the balance sheet.

179
00:08:50,480 --> 00:08:51,680
Speaker 6: The Fed's balance.

180
00:08:51,320 --> 00:08:54,920
Speaker 7: Sheet through quantitative tightening has been coming down quite a bit.

181
00:08:54,960 --> 00:08:57,360
Speaker 7: It's about six point six trillion right now, which is

182
00:08:57,440 --> 00:09:00,839
Speaker 7: low relative in the past few years. The overnight repo

183
00:09:01,000 --> 00:09:03,679
Speaker 7: rates are actually starting to come up, go up in

184
00:09:03,760 --> 00:09:07,040
Speaker 7: price because bank reserves are starting to falter a bit,

185
00:09:07,160 --> 00:09:09,640
Speaker 7: so if there is a shock event to the markets,

186
00:09:10,000 --> 00:09:14,200
Speaker 7: you need to have these overnight rates lower. And I

187
00:09:14,200 --> 00:09:17,080
Speaker 7: think that's partially the story here as well, not just

188
00:09:17,120 --> 00:09:17,880
Speaker 7: the labor market.

189
00:09:18,480 --> 00:09:21,080
Speaker 5: Jim, what are your team, What are you guys seeing

190
00:09:21,160 --> 00:09:23,000
Speaker 5: in terms of best value out there? Where do you

191
00:09:23,000 --> 00:09:24,520
Speaker 5: see some value out there?

192
00:09:25,160 --> 00:09:27,880
Speaker 6: So within the fixed income space, we've been tilted.

193
00:09:28,040 --> 00:09:29,000
Speaker 2: York bets that.

194
00:09:31,520 --> 00:09:34,360
Speaker 7: Within the fixed income space, we've been looking primarily at

195
00:09:34,400 --> 00:09:37,400
Speaker 7: the high yield space and also bank loans. So bank

196
00:09:37,440 --> 00:09:40,120
Speaker 7: loans are it's almost like floating rate high yield, and

197
00:09:40,160 --> 00:09:42,839
Speaker 7: in some ways it's a shorter term reset on that.

198
00:09:43,240 --> 00:09:45,400
Speaker 6: What I would say is that despite the fact that.

199
00:09:45,360 --> 00:09:48,040
Speaker 7: We think rates are coming down, we think that short

200
00:09:48,160 --> 00:09:53,000
Speaker 7: term high yield credit bank loans in particular actually have

201
00:09:53,120 --> 00:09:56,480
Speaker 7: more room to appreciate in price value over time as

202
00:09:56,480 --> 00:09:58,520
Speaker 7: default risks stay relatively low.

203
00:09:59,120 --> 00:10:00,400
Speaker 6: A lot of people like yield.

204
00:10:00,480 --> 00:10:03,280
Speaker 7: We do too, but we also like the bank loan debt,

205
00:10:03,320 --> 00:10:05,200
Speaker 7: and we also like to barbel that by owning some

206
00:10:05,200 --> 00:10:07,120
Speaker 7: short term, high quality government bonds too.

207
00:10:07,200 --> 00:10:08,800
Speaker 2: I don't want to get you in trouble, but there's

208
00:10:08,840 --> 00:10:11,800
Speaker 2: just so much respect from Karen for your application of

209
00:10:11,880 --> 00:10:18,280
Speaker 2: physics to our coupon market. Jim Karen on private credit

210
00:10:18,720 --> 00:10:23,360
Speaker 2: in the liquidity premium, help me here with the lock

211
00:10:23,440 --> 00:10:26,880
Speaker 2: up that's going on in private equity and particularly your

212
00:10:26,920 --> 00:10:28,080
Speaker 2: world private credit.

213
00:10:28,320 --> 00:10:31,120
Speaker 7: Yeah, so in the private credit space, this has been

214
00:10:31,240 --> 00:10:33,600
Speaker 7: an area that's become i'd say a lot more democratized,

215
00:10:33,640 --> 00:10:35,400
Speaker 7: so a lot more entrants have come in. So we

216
00:10:35,480 --> 00:10:39,000
Speaker 7: have a lot of you know, non bank players in

217
00:10:39,040 --> 00:10:41,680
Speaker 7: the markets right now trying to accumulate a lot of

218
00:10:41,720 --> 00:10:44,920
Speaker 7: these assets to basically create funds so that people can

219
00:10:44,960 --> 00:10:47,240
Speaker 7: invest in these things. This has created a bit of

220
00:10:47,240 --> 00:10:49,400
Speaker 7: an overcrowding in that space, like.

221
00:10:49,559 --> 00:10:52,160
Speaker 2: A bit of a two thousand and five over time.

222
00:10:52,320 --> 00:10:56,160
Speaker 7: I wouldn't necessarily say a two thousand and five overcrowding,

223
00:10:56,240 --> 00:10:59,120
Speaker 7: but it is basically the valuations I think at this

224
00:10:59,200 --> 00:11:01,520
Speaker 7: point are getting a little bit stretched. So you do

225
00:11:01,679 --> 00:11:04,320
Speaker 7: have to be very specific and very particular, and be

226
00:11:04,400 --> 00:11:08,840
Speaker 7: very picky about what you're putting into your private credit portfolios.

227
00:11:09,160 --> 00:11:12,080
Speaker 2: If your people, the Rocket scient is working with you,

228
00:11:12,120 --> 00:11:14,600
Speaker 2: they are a lot of kel tech. He only hires that. Well,

229
00:11:14,640 --> 00:11:17,559
Speaker 2: Harvey Muddy's got some token Harvey mud guys is well,

230
00:11:17,600 --> 00:11:20,720
Speaker 2: good morning, West Coast listening early early morning. So you

231
00:11:20,760 --> 00:11:23,320
Speaker 2: do a trench analysis. I'm going to go to David

232
00:11:23,320 --> 00:11:26,520
Speaker 2: Goldbin the Giant Bank of America years ago on the

233
00:11:26,720 --> 00:11:30,840
Speaker 2: private credit tranches. Is the risk the garbage or is

234
00:11:30,880 --> 00:11:34,600
Speaker 2: the real risk the premium tranches where they come down

235
00:11:34,679 --> 00:11:35,400
Speaker 2: five points.

236
00:11:35,440 --> 00:11:37,480
Speaker 7: So it's a really good question because you get the

237
00:11:37,600 --> 00:11:40,920
Speaker 7: yield by owning the lower quality credit stuff what.

238
00:11:40,920 --> 00:11:42,400
Speaker 6: You refer to as garbage.

239
00:11:42,960 --> 00:11:45,960
Speaker 7: It's French and it's French, but you also need to

240
00:11:46,000 --> 00:11:48,360
Speaker 7: balance that with some of the higher the higher quality

241
00:11:48,360 --> 00:11:51,400
Speaker 7: credit stuff is actually really good. I mean that's actually

242
00:11:51,480 --> 00:11:54,040
Speaker 7: very very solid. So you are taking the risk on

243
00:11:54,080 --> 00:11:56,480
Speaker 7: the lower quality credit, but you're not going to get

244
00:11:56,520 --> 00:11:58,360
Speaker 7: the yield that's attractive for people to.

245
00:11:58,320 --> 00:11:59,880
Speaker 6: Buy unless you have some of that.

246
00:12:00,320 --> 00:12:03,760
Speaker 7: So it's really about managing that portfolio and doing the

247
00:12:03,760 --> 00:12:07,080
Speaker 7: bottoms up analysis on every individual company that you're putting in.

248
00:12:07,679 --> 00:12:11,440
Speaker 7: So private credit is a broad term, but per manager,

249
00:12:11,880 --> 00:12:14,240
Speaker 7: per fund, that's what we have to talk about, and

250
00:12:14,280 --> 00:12:16,640
Speaker 7: that's what we have to be very very idiosyncratic when

251
00:12:16,640 --> 00:12:17,200
Speaker 7: we think about this.

252
00:12:17,679 --> 00:12:19,959
Speaker 2: Jim Keron, thank you so much. She's the Mortgan Stanley

253
00:12:20,280 --> 00:12:25,000
Speaker 2: investment process of solutions. With some terse comments there, stay

254
00:12:25,000 --> 00:12:35,960
Speaker 2: with us. More from Bloomberg Surveillance coming up after this.

255
00:12:35,960 --> 00:12:39,880
Speaker 1: This is the Bloomberg Surveillance Podcast. Listen live each weekday

256
00:12:39,880 --> 00:12:43,199
Speaker 1: starting at seven am Eastern on Applecarplay and Android Auto

257
00:12:43,320 --> 00:12:46,280
Speaker 1: with the Bloomberg Business App. You can also listen live

258
00:12:46,360 --> 00:12:49,960
Speaker 1: on Amazon Alexa from our flagship New York station, Just

259
00:12:50,000 --> 00:12:53,760
Speaker 1: say Alexa play Bloomberg eleven thirty work out Asina.

260
00:12:53,480 --> 00:12:55,800
Speaker 2: Joins us right now, It's real she could be with

261
00:12:55,880 --> 00:12:58,880
Speaker 2: us today on this booming equity market. Laurie, lots of

262
00:12:58,920 --> 00:13:02,560
Speaker 2: back and forth here as you write for RBC Capital Markets.

263
00:13:02,880 --> 00:13:06,280
Speaker 2: What is the distinction of the debate right now on

264
00:13:06,520 --> 00:13:07,520
Speaker 2: owning equities?

265
00:13:08,160 --> 00:13:10,439
Speaker 8: Well, thanks for having me, Tom. Look, I think that

266
00:13:10,880 --> 00:13:12,560
Speaker 8: you know, I probably have the best color for you

267
00:13:12,640 --> 00:13:14,720
Speaker 8: this morning from what folks in the UK are thinking.

268
00:13:14,800 --> 00:13:18,080
Speaker 8: That's where I spent last week, and there was, you know,

269
00:13:18,120 --> 00:13:20,400
Speaker 8: sort of a discussion about funds flows, right and if

270
00:13:20,400 --> 00:13:22,200
Speaker 8: you want to sort of fade the US, where do

271
00:13:22,240 --> 00:13:24,600
Speaker 8: you go? And what I told folks was that if

272
00:13:24,600 --> 00:13:27,000
Speaker 8: you look at the EPFR data, what we're seeing verily

273
00:13:27,040 --> 00:13:29,079
Speaker 8: clearly is that there's kind of a lack of conviction

274
00:13:29,200 --> 00:13:31,280
Speaker 8: on what the alternatives are. So whether you're looking at

275
00:13:31,360 --> 00:13:34,920
Speaker 8: Latin or China or Japan or even Europe. Frankly, you've

276
00:13:34,960 --> 00:13:37,160
Speaker 8: had all these sort of attempts for flows to turn

277
00:13:37,200 --> 00:13:40,120
Speaker 8: positive and then they tend to peter out. The European

278
00:13:40,160 --> 00:13:42,520
Speaker 8: ones and the German ones lasted longer than everything else.

279
00:13:43,280 --> 00:13:45,040
Speaker 8: What's funny to me, too, is if you look at

280
00:13:45,040 --> 00:13:48,440
Speaker 8: the global x US category that's had the best flows

281
00:13:48,480 --> 00:13:50,719
Speaker 8: this year, over the last no SA six months or so,

282
00:13:50,760 --> 00:13:52,800
Speaker 8: but even that looks like it's starting to fade.

283
00:13:52,880 --> 00:13:54,640
Speaker 9: So what we see is just sort of a real.

284
00:13:54,520 --> 00:13:57,439
Speaker 8: Kind of lack of lack of conviction on exactly where

285
00:13:57,480 --> 00:13:58,720
Speaker 8: to focus geographically.

286
00:13:58,920 --> 00:14:00,959
Speaker 5: So that trade we saw in early in the year

287
00:14:01,040 --> 00:14:04,079
Speaker 5: to rest of world has that in fact faded?

288
00:14:04,080 --> 00:14:04,520
Speaker 9: Do you think?

289
00:14:04,679 --> 00:14:04,760
Speaker 2: So?

290
00:14:04,880 --> 00:14:06,520
Speaker 8: If you look, we have one chart in our weekly

291
00:14:06,559 --> 00:14:08,320
Speaker 8: and we tend to put the weekly out on Mondays,

292
00:14:08,360 --> 00:14:10,680
Speaker 8: and we look at US relative to non US on

293
00:14:10,720 --> 00:14:13,320
Speaker 8: the MSCI data, and it's just been tracking, you know,

294
00:14:13,400 --> 00:14:15,600
Speaker 8: sort of sideways over the last few months. There's been

295
00:14:15,600 --> 00:14:18,960
Speaker 8: a little bit of strength in the US recently, you know.

296
00:14:19,240 --> 00:14:22,360
Speaker 8: I think what's interesting is that global x US trade,

297
00:14:22,720 --> 00:14:25,120
Speaker 8: even there, the flows have been faltering. I mean, it's

298
00:14:25,640 --> 00:14:28,800
Speaker 8: a time of year when seasonally equities tend to be weak,

299
00:14:28,840 --> 00:14:32,000
Speaker 8: and we actually did a seasonality of fundslow data earlier

300
00:14:32,000 --> 00:14:33,840
Speaker 8: this year, and you tend to see the flows fade

301
00:14:33,840 --> 00:14:35,440
Speaker 8: at this point as well. So maybe this is just

302
00:14:35,480 --> 00:14:37,440
Speaker 8: a market frankly that's getting a little bit tired.

303
00:14:38,160 --> 00:14:40,560
Speaker 5: Our friends in the UK and London, are they concerned

304
00:14:40,560 --> 00:14:42,600
Speaker 5: about valuations here in this US market? Yeah?

305
00:14:42,640 --> 00:14:44,440
Speaker 8: That would I would say, you know, the number one

306
00:14:44,520 --> 00:14:47,000
Speaker 8: question that I felt like I heard from people is

307
00:14:47,040 --> 00:14:49,240
Speaker 8: just kind of what's sentiment like in the US. People

308
00:14:49,280 --> 00:14:51,120
Speaker 8: just kind of wanted to know what investors are thinking

309
00:14:51,160 --> 00:14:53,240
Speaker 8: over here, and you know, kind of how that compared.

310
00:14:53,440 --> 00:14:55,280
Speaker 8: By the end of the week. I got a good

311
00:14:55,320 --> 00:14:57,440
Speaker 8: sense of that, which is the UK investors seemed to

312
00:14:57,440 --> 00:14:59,680
Speaker 8: be a bit more cautious than the US investors. But

313
00:14:59,680 --> 00:15:02,920
Speaker 8: I would say number one issue people were proactively bringing

314
00:15:03,000 --> 00:15:03,840
Speaker 8: up was valuation.

315
00:15:04,160 --> 00:15:05,080
Speaker 2: And you know, my.

316
00:15:05,400 --> 00:15:08,080
Speaker 8: UK clients are are fantastic macro thinker, so this is

317
00:15:08,080 --> 00:15:09,560
Speaker 8: not a knock on them. But there was kind of

318
00:15:09,600 --> 00:15:13,000
Speaker 8: no one specific thing beyond that that they were pointing at.

319
00:15:13,040 --> 00:15:16,080
Speaker 8: It was just things seem really elevated, things seem really high.

320
00:15:16,360 --> 00:15:17,960
Speaker 8: Was kind of how the conversation started.

321
00:15:18,400 --> 00:15:20,960
Speaker 5: Are there certain sectors that when you go over to

322
00:15:21,240 --> 00:15:25,120
Speaker 5: the UK or that your clients want to speak about,

323
00:15:25,160 --> 00:15:28,080
Speaker 5: whether it's tech or financials or healthy. I mean, is

324
00:15:28,160 --> 00:15:29,960
Speaker 5: there certain sectors they want to focus on?

325
00:15:30,200 --> 00:15:32,720
Speaker 8: You know, It's funny, Paul, usually financials, but I can't

326
00:15:32,720 --> 00:15:35,680
Speaker 8: even remember one meeting where the client's proactively brought it up.

327
00:15:36,400 --> 00:15:38,320
Speaker 8: You know, I think I took it there eventually because

328
00:15:38,320 --> 00:15:41,400
Speaker 8: it's a sector I like. Normally, I would say, as

329
00:15:41,400 --> 00:15:44,960
Speaker 8: a general rule, it's always tech, it's always consumer, and

330
00:15:45,000 --> 00:15:47,440
Speaker 8: healthcare often tends to be in focus as well. I

331
00:15:47,440 --> 00:15:49,880
Speaker 8: think for technology, you know, it just has to do

332
00:15:49,960 --> 00:15:52,360
Speaker 8: with where the global opportunity set sits, so that's a

333
00:15:52,360 --> 00:15:54,320
Speaker 8: big part of it. Obviously tech is a big sort

334
00:15:54,360 --> 00:15:56,560
Speaker 8: of workhourse, but healthcare was really in focus.

335
00:15:56,640 --> 00:15:58,560
Speaker 2: Lest I do to be sure I'm talking from a

336
00:15:58,600 --> 00:16:03,400
Speaker 2: technical analyst standpoint, is a fundamental type? What is your

337
00:16:03,640 --> 00:16:07,000
Speaker 2: setup where you say I have to get off this

338
00:16:07,080 --> 00:16:11,800
Speaker 2: bull market? Is it's not fed chat? I'm pretty negative

339
00:16:11,800 --> 00:16:14,840
Speaker 2: on that. Is it like earnings? Miss?

340
00:16:14,920 --> 00:16:17,440
Speaker 8: I think earnings is huge, you know, I do think

341
00:16:17,480 --> 00:16:21,520
Speaker 8: if you related to earnings is the fundamental economic backdrop.

342
00:16:21,560 --> 00:16:24,400
Speaker 8: Whereas if you look at you know, that's a feeder, right,

343
00:16:24,480 --> 00:16:26,680
Speaker 8: revenues really matter a great deal for earning.

344
00:16:26,720 --> 00:16:28,360
Speaker 2: There's a second time. Let's stop there. This is the

345
00:16:28,360 --> 00:16:31,120
Speaker 2: second time we've heard this in like six days. How

346
00:16:31,120 --> 00:16:38,360
Speaker 2: do you analyze revenue dynamics? Starting with JP Moregan October fourteenth.

347
00:16:37,480 --> 00:16:40,520
Speaker 8: So you know, I can't say on that company specifically,

348
00:16:40,560 --> 00:16:42,680
Speaker 8: but when I do sort of my modeling, Tom and

349
00:16:43,240 --> 00:16:45,880
Speaker 8: in my earnings model, the revenue line is very much

350
00:16:45,880 --> 00:16:47,680
Speaker 8: a quant driven model. So we have kind of five

351
00:16:47,720 --> 00:16:51,800
Speaker 8: different components, and with revenues, the two most impactful macro

352
00:16:51,920 --> 00:16:56,280
Speaker 8: variables are GDP and CPI, and so we're looking at

353
00:16:56,280 --> 00:16:58,760
Speaker 8: real GDP and then CPI. We break them out separately,

354
00:16:59,200 --> 00:17:02,000
Speaker 8: and both of the if you take the assumptions up,

355
00:17:02,080 --> 00:17:03,640
Speaker 8: it's going to goose your revenue number.

356
00:17:04,040 --> 00:17:06,440
Speaker 2: I mean, I can't emphasize, folks, which you just heard there,

357
00:17:06,560 --> 00:17:09,480
Speaker 2: how important it is. This goes back to Tom Gelvin

358
00:17:09,520 --> 00:17:12,640
Speaker 2: and DLJ, and I'm sure Tom would say people before him,

359
00:17:12,960 --> 00:17:15,199
Speaker 2: but revenue It's one of the first things I did

360
00:17:15,280 --> 00:17:19,840
Speaker 2: when I came to Bloomberg. Revenue analysis is really important.

361
00:17:19,840 --> 00:17:22,680
Speaker 2: Susie Welcher that essay in the Wall Street Journal or

362
00:17:23,040 --> 00:17:27,119
Speaker 2: her former husband, Jack Welch, was brilliant on unit price

363
00:17:27,560 --> 00:17:29,560
Speaker 2: dynamics of revenue, Paul.

364
00:17:29,880 --> 00:17:32,240
Speaker 5: So, Laurie, Tom and I've been talking about it this morning.

365
00:17:32,480 --> 00:17:35,200
Speaker 5: We might have a government shutdown tomorrow night at twelve

366
00:17:35,240 --> 00:17:38,000
Speaker 5: oh one am.

367
00:17:38,080 --> 00:17:39,639
Speaker 6: What does that mean historically for market?

368
00:17:39,840 --> 00:17:42,639
Speaker 8: So it's interesting. I did run over the weekend. I

369
00:17:42,640 --> 00:17:44,840
Speaker 8: looked at the betting market data on I think it's

370
00:17:45,000 --> 00:17:48,800
Speaker 8: WSL predict that you guys all run, and it's this

371
00:17:48,880 --> 00:17:50,560
Speaker 8: great little widget. You know, you can go and see

372
00:17:50,600 --> 00:17:52,359
Speaker 8: what betting markets are pricing on all these you know,

373
00:17:52,440 --> 00:17:55,919
Speaker 8: kind of stock market sensitive issues. And I noticed that

374
00:17:55,960 --> 00:17:59,679
Speaker 8: the betting market data was starting to reflect higher probability

375
00:17:59,720 --> 00:18:01,679
Speaker 8: of a shut down last week, right around when the

376
00:18:01,680 --> 00:18:04,360
Speaker 8: market was wobbling. Now, I don't want you to over

377
00:18:04,440 --> 00:18:06,760
Speaker 8: extrapolate there. I didn't get a single question from clients

378
00:18:06,800 --> 00:18:08,880
Speaker 8: on it last week. I got a question from one trader,

379
00:18:09,600 --> 00:18:11,560
Speaker 8: and some of us macro folks at RBC have been

380
00:18:11,560 --> 00:18:13,600
Speaker 8: writing about it right because it is in the headlines

381
00:18:13,640 --> 00:18:16,960
Speaker 8: a bit. This is a really, really tough thing to

382
00:18:17,080 --> 00:18:20,399
Speaker 8: analyze and parse out exactly how it's impacted stocks in

383
00:18:20,440 --> 00:18:22,320
Speaker 8: the past. If you just look at when the days

384
00:18:22,520 --> 00:18:25,119
Speaker 8: when the government's actually been shut and what stocks have

385
00:18:25,200 --> 00:18:27,560
Speaker 8: done the two words you want to remembered are mixed

386
00:18:27,560 --> 00:18:30,040
Speaker 8: and mild. In the seventies they tended to go down

387
00:18:30,119 --> 00:18:32,720
Speaker 8: more recently up, but it's been very mild overall.

388
00:18:32,960 --> 00:18:35,600
Speaker 2: Laurie, thank you so much, greatly appreciate it. You the

389
00:18:35,640 --> 00:18:37,000
Speaker 2: Herod's in London.

390
00:18:36,680 --> 00:18:38,840
Speaker 8: I didn't make it there, no fun. I was just

391
00:18:38,880 --> 00:18:40,879
Speaker 8: working the whole time and went to sleep early.

392
00:18:41,359 --> 00:18:44,760
Speaker 2: I've done that. There's like key throw hotel work, no

393
00:18:44,960 --> 00:18:48,280
Speaker 2: hotel U key throw lub and they go, how was London?

394
00:18:48,520 --> 00:18:52,680
Speaker 2: What did you love? And I'm like, you threw hotel work?

395
00:18:52,800 --> 00:18:55,040
Speaker 8: The client lunches were the highlight because then I actually

396
00:18:55,040 --> 00:18:56,560
Speaker 8: got to have you know, local food.

397
00:18:56,640 --> 00:18:58,240
Speaker 2: Your full engless breakfast. Come on.

398
00:18:58,840 --> 00:19:01,040
Speaker 8: No, my hotel had a nice buffet though, but I

399
00:19:01,040 --> 00:19:03,040
Speaker 8: had I had peas at lunch and I had some

400
00:19:03,240 --> 00:19:03,880
Speaker 8: somefish and chaw.

401
00:19:03,920 --> 00:19:07,200
Speaker 2: You have a smash it with your knife, yeah, Lurri Kelvison,

402
00:19:07,280 --> 00:19:10,639
Speaker 2: thank you so much, greatly appreciate it. With RBC stay

403
00:19:10,640 --> 00:19:21,959
Speaker 2: with us, more from Bloomberg Surveillance coming up after this.

404
00:19:21,960 --> 00:19:25,840
Speaker 1: This is the Bloomberg Surveillance podcast. Listen live each weekday

405
00:19:25,880 --> 00:19:28,920
Speaker 1: starting at seven am Eastern on Apple, Cocklay and Android

406
00:19:28,920 --> 00:19:31,920
Speaker 1: Auto with the Bloomberg Business App. You can also watch

407
00:19:32,000 --> 00:19:34,960
Speaker 1: us live every weekday on YouTube and always on the

408
00:19:34,960 --> 00:19:36,040
Speaker 1: Bloomberg terminal.

409
00:19:36,160 --> 00:19:38,960
Speaker 2: The newspapers, Lisa Matayo, what do you have? This one least?

410
00:19:39,040 --> 00:19:39,280
Speaker 9: Okay?

411
00:19:39,280 --> 00:19:41,120
Speaker 10: This one's in the Wall Street Journal has to look

412
00:19:41,160 --> 00:19:43,840
Speaker 10: into credit markets, which it says is running hot. But

413
00:19:43,880 --> 00:19:46,720
Speaker 10: they're saying that some on Wall Streets say it's too hot.

414
00:19:46,920 --> 00:19:48,560
Speaker 10: I mean, this is something you've talked with a lot

415
00:19:48,560 --> 00:19:51,080
Speaker 10: of guests on the show about. They say, Wall Streets

416
00:19:51,080 --> 00:19:53,480
Speaker 10: on edge. Any bad news is kind of touching a nerve.

417
00:19:53,520 --> 00:19:55,520
Speaker 10: They gave the example of kind of what's triggering some

418
00:19:55,520 --> 00:19:58,600
Speaker 10: conversations around bond investors, analysts. They talked about the two

419
00:19:58,640 --> 00:20:00,359
Speaker 10: set in bankruptcys.

420
00:19:59,720 --> 00:20:01,200
Speaker 9: And the auto world. Do you have one of a

421
00:20:01,280 --> 00:20:03,359
Speaker 9: lender the other auto parts supplier.

422
00:20:03,840 --> 00:20:07,280
Speaker 10: They say, so far, there's no sign of this bigger fallout,

423
00:20:07,359 --> 00:20:09,880
Speaker 10: but when you combine that with other challenges like versus

424
00:20:09,920 --> 00:20:13,120
Speaker 10: in inflation, rising defaults and credit and private credit which

425
00:20:13,160 --> 00:20:15,280
Speaker 10: is a huge it's kind of making them take a

426
00:20:15,280 --> 00:20:15,880
Speaker 10: step back.

427
00:20:15,960 --> 00:20:17,359
Speaker 9: So it has this whole look into it.

428
00:20:17,640 --> 00:20:20,080
Speaker 5: But the new issue market is they're just ripping the

429
00:20:20,119 --> 00:20:23,399
Speaker 5: last few weeks, companies raising capital all over the place.

430
00:20:23,440 --> 00:20:25,800
Speaker 5: So I think, I think, if you're a good credit,

431
00:20:25,920 --> 00:20:27,720
Speaker 5: I mean at the market, we get the first.

432
00:20:27,400 --> 00:20:29,840
Speaker 2: Brand's news over the weekend, which you know, I'm not

433
00:20:29,880 --> 00:20:32,919
Speaker 2: at the speed on. But nevertheless, there's these little to

434
00:20:33,000 --> 00:20:36,080
Speaker 2: Lisa's point, these little little data points, little data points

435
00:20:36,560 --> 00:20:38,040
Speaker 2: dat next week.

436
00:20:38,320 --> 00:20:40,679
Speaker 10: Okay, So Hollywood studios, right, they know the power of

437
00:20:40,720 --> 00:20:44,480
Speaker 10: online creative creators. We've heard different stories about that, but

438
00:20:44,640 --> 00:20:47,359
Speaker 10: Bloomberg screen Time they actually take a look into why

439
00:20:47,680 --> 00:20:50,880
Speaker 10: only a few of them on YouTube? These creators are

440
00:20:50,880 --> 00:20:55,240
Speaker 10: really having success raising money, selling projects for streaming services.

441
00:20:55,520 --> 00:20:57,600
Speaker 9: Yeah, lukas Shaw. So he kind of gets into it.

442
00:20:57,640 --> 00:21:00,679
Speaker 10: I mean, you have like Amazon, Netflix, Disney, Dave's License

443
00:21:00,760 --> 00:21:03,600
Speaker 10: shows that live on YouTube, like Miss Rachel and Coco Mellon.

444
00:21:03,920 --> 00:21:08,080
Speaker 10: But there's there's some creators who are just having a

445
00:21:08,119 --> 00:21:08,680
Speaker 10: hard time.

446
00:21:08,800 --> 00:21:10,639
Speaker 9: So he kind of digs into it.

447
00:21:10,680 --> 00:21:14,680
Speaker 10: He's saying, there's this this disconnect between traditional financial institutions,

448
00:21:14,680 --> 00:21:18,080
Speaker 10: this new breed of digital media companies. All a few

449
00:21:18,119 --> 00:21:21,320
Speaker 10: YouTube channels, they build companies with real scale. He says,

450
00:21:21,520 --> 00:21:24,360
Speaker 10: a lot of times it's problems with valuation and that's

451
00:21:24,359 --> 00:21:26,119
Speaker 10: why they can't get the money they need. But it

452
00:21:26,160 --> 00:21:28,320
Speaker 10: was this really kind of deep dive into it as

453
00:21:28,359 --> 00:21:30,800
Speaker 10: to why they can't you know, us.

454
00:21:30,680 --> 00:21:33,159
Speaker 5: Sell it's interesting. I mean, I mean Lucas wrote this

455
00:21:33,280 --> 00:21:37,280
Speaker 5: Bloomberg BusinessWeek cover story last week about mister Beast. Yeah,

456
00:21:37,320 --> 00:21:39,959
Speaker 5: the biggest YouTube star in the world. It gets more

457
00:21:39,960 --> 00:21:42,640
Speaker 5: than two hundred and fifty million views on every video,

458
00:21:42,680 --> 00:21:44,800
Speaker 5: but his company lost more than a one hundred million

459
00:21:44,840 --> 00:21:45,680
Speaker 5: dollars last year.

460
00:21:45,720 --> 00:21:47,399
Speaker 6: So yeah, I don't know.

461
00:21:47,640 --> 00:21:50,639
Speaker 10: His show did lost a lot of money, but I

462
00:21:50,640 --> 00:21:53,119
Speaker 10: don't know how that all works exactly. That's kind of

463
00:21:53,119 --> 00:21:55,960
Speaker 10: what it gets into, which is pretty interesting. And then

464
00:21:56,080 --> 00:21:58,479
Speaker 10: finally we have some big news here in Times Square.

465
00:21:58,760 --> 00:22:01,760
Speaker 10: Something big is coming. It's not the casino, No, you

466
00:22:01,800 --> 00:22:04,720
Speaker 10: know that's not happening. It's Laboo Boo owner Pop Marty

467
00:22:05,000 --> 00:22:07,960
Speaker 10: is coming to Times Square. Yes, this is according to

468
00:22:07,960 --> 00:22:08,680
Speaker 10: the New York Posts.

469
00:22:08,680 --> 00:22:11,200
Speaker 2: So instead of the ball coming down, New Year's.

470
00:22:12,320 --> 00:22:17,320
Speaker 10: Head a ten year lease for seven thousand square foot

471
00:22:17,320 --> 00:22:21,040
Speaker 10: store fifteen forty the Broadway store. Yeah, Broadway in forty fourth,

472
00:22:22,040 --> 00:22:25,560
Speaker 10: expected to open twenty twenty six in the second half.

473
00:22:25,720 --> 00:22:27,200
Speaker 9: But it's it's a big building.

474
00:22:27,280 --> 00:22:30,520
Speaker 10: Disney stores in there forever twenty one US Polo associations

475
00:22:30,520 --> 00:22:31,040
Speaker 10: in there.

476
00:22:31,240 --> 00:22:32,040
Speaker 9: So it's just.

477
00:22:32,040 --> 00:22:35,600
Speaker 10: Going to show how big this brand is becoming.

478
00:22:35,760 --> 00:22:39,439
Speaker 2: Are all the dolls creepy or or can there be

479
00:22:39,560 --> 00:22:40,560
Speaker 2: nice la boo boo?

480
00:22:40,960 --> 00:22:44,360
Speaker 10: They're all kind of like creepy, like little monster toothy dolls.

481
00:22:45,040 --> 00:22:47,399
Speaker 10: But the celebrities love them and that's what makes the

482
00:22:47,480 --> 00:22:48,360
Speaker 10: kids want to get them.

483
00:22:48,440 --> 00:22:53,480
Speaker 9: And they've been they go on. They very expensive bags.

484
00:22:53,640 --> 00:22:57,200
Speaker 2: So yes, we had one floating around the house. Vent

485
00:22:57,280 --> 00:22:59,520
Speaker 2: Bill was chewing on it.

486
00:23:00,840 --> 00:23:02,280
Speaker 9: There's a worth a lot of money.

487
00:23:03,520 --> 00:23:05,960
Speaker 2: There's still like going. I mean, they're still popular and

488
00:23:06,000 --> 00:23:06,360
Speaker 2: all that.

489
00:23:06,440 --> 00:23:08,760
Speaker 10: They're still I mean they pushed you know, pop marks.

490
00:23:08,800 --> 00:23:10,960
Speaker 10: They searched twentyure and thirteen percent this year over twenty

491
00:23:11,000 --> 00:23:13,400
Speaker 10: twenty four, so it's a big, big push for them.

492
00:23:13,760 --> 00:23:16,120
Speaker 10: They started to slow back a little, but I mean,

493
00:23:16,240 --> 00:23:18,960
Speaker 10: if a store comes to Times Square, people are gonna come.

494
00:23:19,400 --> 00:23:21,840
Speaker 2: Lisa Montereya, thanks so much. It is a newspaper. It's

495
00:23:21,880 --> 00:23:22,840
Speaker 2: hugely popular.

496
00:23:23,640 --> 00:23:28,480
Speaker 1: This is the Bloomberg Surveillance podcast, available on Apple, Spotify,

497
00:23:28,600 --> 00:23:32,400
Speaker 1: and anywhere else you get your podcasts. Listen live each

498
00:23:32,400 --> 00:23:36,240
Speaker 1: weekday seven to ten am Easter and on Bloomberg dot com,

499
00:23:36,400 --> 00:23:40,200
Speaker 1: the iHeartRadio app tune In, and the Bloomberg Business app.

500
00:23:40,480 --> 00:23:43,600
Speaker 1: You can also watch US live every weekday on YouTube

501
00:23:43,920 --> 00:23:45,920
Speaker 1: and always on the Bloomberg terminal