Speaker 1: Welcome to the Bloomberg Surveillance Podcast Downtown Keene. Along with
Speaker 1: Jonathan Ferrell and Lisa A. Brownwitz jay Leie, we bring
Speaker 1: you insight from the best and economics, finance, investment and
Speaker 1: international relations. Find Bloomberg Surveillance and Apple Podcast SoundCloud, Bloomberg
Speaker 1: dot Com and of course, on the Bloomberg terminal. Let's
Speaker 1: talk about inflation. Mike Holland, Chairman and Chairman of Holland
Speaker 1: and Company, joins us at this morning to do just
Speaker 1: that and to expand the conversation from there. Mike, good
Speaker 1: to speak to you. Thanks for joining us here on
Speaker 1: Bloomberg TV. What do you think a central bank policy
Speaker 1: can do against inflation right now? Because you say ahead
Speaker 1: of our conversation in your notes, you say there's too
Speaker 1: much money chasing too few goods, and so that makes
Speaker 1: me realize that the taper can't do much about the
Speaker 1: two few goods, but it can do something about the
Speaker 1: too much money. So what kind of downward pressure can
Speaker 1: the FED bring to bear on inflation, given some of
Speaker 1: it is driven by those supply chain issues and such
Speaker 1: an an important question, and I'm not sure that Jerome
Speaker 1: Paul if he were sitting with you right now could
Speaker 1: answer that because he has all of these tools, which
Speaker 1: he employed brilliantly uh fifteen eighteen twenty months ago, UH
Speaker 1: and as as Uh started out one of the epic
Speaker 1: salvage of the U. S economy missions um that any
Speaker 1: FED president has ever done, FED had has ever done.
Speaker 1: Right now, they are in a in a period where
Speaker 1: they are losing a little bit of confidence. In addition
Speaker 1: to their persistence with that word transitory and inflation. A
Speaker 1: couple of the FED presidents regional presidents have had to
Speaker 1: resign because of claims of some insight or whatever. But
Speaker 1: I think the luster is a little bit off the FED.
Speaker 1: I think that Paul has has shown that he can
Speaker 1: do well in trying circumstances. Right now. I think it's
Speaker 1: pretty well in bred in the population. As Kayley was
Speaker 1: just saying, that we have inflation, particularly the wage price
Speaker 1: spiral kind of inflation from the seventies that is so
Speaker 1: inimical to to to a good economy. So he's got
Speaker 1: his job cut out for him. I don't think he
Speaker 1: would be able to answer the question is what will
Speaker 1: he do? Because they have lots of tools, some of
Speaker 1: which are can work well and depending on what tools
Speaker 1: they use. How how would you put the odds of
Speaker 1: a policy mistake Mike, Oh, Kayley, that's a I don't
Speaker 1: even want to talk about it because with with the
Speaker 1: rates where they are now, which are at historic levels,
Speaker 1: historically bad levels for the Fed, they don't have much
Speaker 1: room to do anything with them. The supply of money, however,
Speaker 1: which is really talked about by the people come out
Speaker 1: of the show and talk about what the Fed can do,
Speaker 1: and they're talking about rate heights and so on. I
Speaker 1: think it's the supply of money, which has been it's
Speaker 1: to to to a few goods chased by a lot
Speaker 1: of money is what causing this in the wage price
Speaker 1: BIRO is going to persist long after the services and
Speaker 1: and uh other kinds of inflation. Commodity inflation is already
Speaker 1: looking better. I think that the the viruses as of
Speaker 1: this morning officially being retired by the markets. I think
Speaker 1: inflation is the is the big bogey over the next
Speaker 1: six to twelve eighteen months. Mike, what do you think
Speaker 1: would be the bigger event for the markets when the
Speaker 1: Fed ultimately does lift off and we get that first
Speaker 1: rate hike, or when q T begins and we actually
Speaker 1: start rolling off that balance sheet. Well, between the two,
Speaker 1: the balance sheet is it's it's the key. It's it's
Speaker 1: the amount of money going into the system. But they're
Speaker 1: both important because the market is is determined into a
Speaker 1: great deal by psychology. Psychology has been waning recently with
Speaker 1: regard to the favoritism toward the Fed. So I think
Speaker 1: that they have to do smart things. But I think
Speaker 1: that in the end of the day, it's it's the
Speaker 1: supply of money which will be the key, the proverbial
Speaker 1: punch ball as it was Mike. I mean, for me,
Speaker 1: I have one question for you. Our bonds dead. I mean,
Speaker 1: if one more person tells me to get short duration,
Speaker 1: move up in quality, uh, you know, maintain ample liquidity,
Speaker 1: I may just blow my brains out. You know. For me,
Speaker 1: what serves the store as a store of value in
Speaker 1: this environment? Well, Damian, I think beware, beware the bottom market.
Speaker 1: It's almost uh baked into the cake, the Christmas cake
Speaker 1: here that you can lose money in a meaningful way
Speaker 1: over the next twelve months. In terms of interest rates
Speaker 1: move up. I should say when interest rates move up,
Speaker 1: the Fed has to move interest rates up the bond
Speaker 1: market unless we go into a series recession caused by
Speaker 1: in part rates going up. The bond market is going
Speaker 1: to have a very negative reaction. So you're gonna lose money,
Speaker 1: just a question of how much, and and and so.
Speaker 1: Then what about the risk of a policy ira, Mike,
Speaker 1: I mean, you know, I mean, do you think the
Speaker 1: Fed can actually taper without causing a tantrum this time around?
Speaker 1: I think, damon that the that Jerome Polo is very savvy.
Speaker 1: I think he watched the market. I think he'll do
Speaker 1: his best to avoid that. But I think unfortunately for
Speaker 1: us as investors and as citizens, uh, the possibility of
Speaker 1: a mistake is relatively high. All right, thank you so
Speaker 1: much for joining us, my Collin, appreciate your Yes. Happy
Speaker 1: holidays to you, and thank you for joining us on
Speaker 1: a holiday week. Your time is even more valuable for
Speaker 1: that reason. Thank you for the insight. Matt Lizette, chief
Speaker 1: US economist at Deutsche Bank joining us now, he's gonna
Speaker 1: have smart things to say about all of this. What
Speaker 1: do you read into these numbers, Matt? What can you
Speaker 1: take away from them that it's going to be useful
Speaker 1: as we think about the trajectory we're on into next year,
Speaker 1: it's the consumer gonna hold up? Is this going to
Speaker 1: be an industrial story next year? Give us your take, sure,
Speaker 1: thanks so much for having me. I guess I focus
Speaker 1: on two things from this morning's data. One has the inflation.
Speaker 1: It's been the story of it will remain the story
Speaker 1: of that core PC data up point five percent month
Speaker 1: on month was was run in line with our expectations,
Speaker 1: but we see that the highest year of a year
Speaker 1: race since the late nineteen eighties. Uh. So that is
Speaker 1: in line with expectations, but just putting it into context
Speaker 1: how high inflation is at the moment and why the
Speaker 1: Fed will be tightening policy next year. The second I
Speaker 1: think is consumer spending, and and there we saw real
Speaker 1: consumer spending flat month of month, below expectations. And really
Speaker 1: this is before omicron hits. It's before the child tax
Speaker 1: credit may may hit incomes uh in January if that's
Speaker 1: not renewed. And so we do see a consumer that
Speaker 1: that has looked a little bit more fragile. Fragile consumer
Speaker 1: sentiment has dipped late in the year, and so I
Speaker 1: think from a growth perspective, that does raise at least
Speaker 1: some of the downside risks on the consumer. Yeah, I
Speaker 1: mean my god. I mean, look at the core rate
Speaker 1: four point seven. That's a bit of a surprise. I
Speaker 1: mean for me, you know, that's the high since two
Speaker 1: I mean, Matt, you know, what's your position on inflation
Speaker 1: as we get into the new year. I mean, should
Speaker 1: we expect you know, inflation as many are calling for,
Speaker 1: and certainly as the markets are pricing in to accelerate
Speaker 1: a little bit and then come often the second half
Speaker 1: of the year. What do you think they're sure? So
Speaker 1: I think in the near term it is gonna get worse. Um,
Speaker 1: we do have we know some from some core goods
Speaker 1: items use cars, new vehicles, We're probably going to see
Speaker 1: some upward pressure there in the near term. I think
Speaker 1: in addition to that, housing costs in terms of rent
Speaker 1: and o E are are going to be continue to
Speaker 1: pick up. So the near term it does get worse.
Speaker 1: I think we are of a perspective that it will
Speaker 1: come down later next year, but that will remain very elevated.
Speaker 1: So we have core PC inflation at around two point
Speaker 1: seven two point eight percent at the end of next year,
Speaker 1: that's still seventy eight basis points above the FEDS target.
Speaker 1: And it's exactly the reason that we expect them to
Speaker 1: raise rates at least three times next year. Yeah, Matthew,
Speaker 1: And I heard you hint at it. You know, housing
Speaker 1: prices and rents, you know that, and the supply bottlenext
Speaker 1: due to the do the om con variant. I mean, like,
Speaker 1: what are your thoughts on those? I mean, like, you know,
Speaker 1: those are the obviously the two big factors that are
Speaker 1: going to drive inflation in the US come the new year.
Speaker 1: You know, where do you think? Sure? I think the
Speaker 1: key story, and as I saw you mentioned earlier is
Speaker 1: about the labor market and how COVID tends to impact that.
Speaker 1: What we've seen during the delta wave in previous waves
Speaker 1: is it tends to shrink the labor force. You tend
Speaker 1: to see labor force participation decline. It tends to do that,
Speaker 1: particularly for those that are impacted by childcare, whether it's
Speaker 1: schooling or childcare and needs for for younger children. And
Speaker 1: so I think in the next few months, probably probably
Speaker 1: for the first half of this year, the labor force
Speaker 1: remains constrained. That means the labor market tends it will
Speaker 1: tend to look tight. Wages will continue to accelerate, uh,
Speaker 1: and that'll be a tight labor market that that is
Speaker 1: feeding into inflationary pressures. I think as we get further out,
Speaker 1: I'm optimistic that labor force will come back. If you
Speaker 1: look at primate participation, it rose ninety basis points this year,
Speaker 1: and actually relative to last cycle, looks relatively good compared
Speaker 1: to where it was last cycle given the unemployment rate.
Speaker 1: So I'm optimistic that labor force will rise in the
Speaker 1: second half of next year and further out. But in
Speaker 1: the near term it's likely to remain constrained given omacrom
Speaker 1: and the and the pandemic well and not. I wonder
Speaker 1: how the build up of savings plays in here as well,
Speaker 1: because obviously the fact that the consumer has a pretty
Speaker 1: strong balance sheet has allowed spending to continue to keep
Speaker 1: pace even as incomes don't necessarily with inflation, and that
Speaker 1: wage growth is still when adjusted for inflation, uh not
Speaker 1: where you know it might need to be in order
Speaker 1: for consumption to be that strong. Otherwise, ask the consumer
Speaker 1: starts to draw it down on those savings, which we're
Speaker 1: already seeing. Is it going to take a complete removal
Speaker 1: of that buffer to drive people back into the labor force. Sure,
Speaker 1: So I think it's a very key question we have
Speaker 1: excess savings at around two point four trillion dollars. That's
Speaker 1: how much has been built up accumulated since the pandemic hit.
Speaker 1: But I think the key point there is that that
Speaker 1: is heavily skewed towards the upper part of the income
Speaker 1: distribution UH and older, older age households, and so you
Speaker 1: have a large portion of the population of the income
Speaker 1: distribution that does not have excess savings that have been
Speaker 1: built up, and therefore I don't think that that is
Speaker 1: a key constraining force on them coming back into the
Speaker 1: labor force. I think what it does tell us is
Speaker 1: there are a number of factors that do tell you
Speaker 1: that the consumer does have a strong balance sheet. Excess
Speaker 1: savings is one of them. That income ratios have fallen,
Speaker 1: debt service ratios are are quite low, and net worth
Speaker 1: is really elevated, but households are dealing with a number
Speaker 1: of shocks in the near term. Obviously, is one UH
Speaker 1: sentiment has been hit on that an income will be
Speaker 1: hit if we don't have the child tax credit renewed
Speaker 1: next year. And I'm so glad you brought that up, because,
Speaker 1: of course, the reason we talk about such a high
Speaker 1: saving story is because we saw unprecedented fiscal stimulus that
Speaker 1: padded consumers wallets. When we think about build back better
Speaker 1: and that child tax credit specifically, is that if that
Speaker 1: doesn't happen, what are the growth implications of that? Sure,
Speaker 1: So we assume that it will be renewed next year,
Speaker 1: uh and if we're not renewed, that that would reduce
Speaker 1: our growth forecast by thirty to fifty basis points. So
Speaker 1: we would go from thick three point six percent growth
Speaker 1: next year to something closer to three percent growth. It's material,
Speaker 1: is particularly material for the consumer, but in my mind,
Speaker 1: it's not something that moves us from you know, very
Speaker 1: very high, well above trend to something that sees the
Speaker 1: labor market begin to contract. So I don't think it
Speaker 1: has as big of implications for the Fed FED policy.
Speaker 1: The Fed story. They will still be tightening policy, the
Speaker 1: labor markets should continue to improve, But it is a
Speaker 1: material impact on the growth outlet for next year. Matt.
Speaker 1: You're talking about three, possibly four rate hikes next year
Speaker 1: from the FED. Recessions are normally caused by the Fed
Speaker 1: raising rates. It's either higher rates or higher energy prices.
Speaker 1: To a certain extent, we could have both next year,
Speaker 1: how would you handicap the risk of a recession in
Speaker 1: the United States? So, I think you have very interesting
Speaker 1: divergences right now between recession indicators. There's there's a few
Speaker 1: consumer indicators that we focus on closely. The look at
Speaker 1: either at the gaps between expectations and current conditions or
Speaker 1: the gaps between current conditions in the different surveys, and
Speaker 1: those look like recessions are very elevated call it over
Speaker 1: the next year. On the on the other hand, if
Speaker 1: you look at YELD curve metrics, yes they have flattened,
Speaker 1: but they remained pretty steep and are suggesting recession risks
Speaker 1: are pretty muted around. I think you nailed it that
Speaker 1: the biggest risk here is the FED. That the FED
Speaker 1: has to respond more aggressively to inflation, uh, and that
Speaker 1: that does trigger the next downturn. That is not our
Speaker 1: base case. We think that they raise rates as you
Speaker 1: mentioned three to four times, that they begin donewind the
Speaker 1: balance sheet, and that inflation comes down to supply bottlenecks
Speaker 1: begin to work themselves out. But the key risk here
Speaker 1: is UH, maybe their supply bottle necks do not work
Speaker 1: themselves out, or inflation expectations pick up or a wage
Speaker 1: price spiral begins to uh an anchor inflation, and that
Speaker 1: becomes self fulfilling in many ways, and that the FED
Speaker 1: has to move more aggressively. It's a very difficult different
Speaker 1: environment than where we were pre COVID, where inflation was
Speaker 1: quite low when the FED started to raise rates and
Speaker 1: the labor market still had some room to tighten. Today,
Speaker 1: inflation is well above target, the unemployment rate is almost
Speaker 1: at the Fed's view of neighbor of the long run level,
Speaker 1: and so there is a great risk I think that
Speaker 1: they have to move more aggressively and that that does
Speaker 1: raise recession risks. Probably not two, but as we look
Speaker 1: out into four man, I just have to pick up
Speaker 1: a little bit on what Kailey was alluding to earlier.
Speaker 1: You know, we had City Global Chief Economists Nathan Sheets
Speaker 1: on yesterday and he talked about the immense fiscal hurdle
Speaker 1: that the US is facing in the first half of
Speaker 1: this year. I mean two point seven trillion of fiscal
Speaker 1: stimulus last year. You know, how is this economy going
Speaker 1: to manage through without any of that? That's equivalent by
Speaker 1: the way, as you well are aware of GDP. So
Speaker 1: that's a pretty big number that's not coming anytime soon,
Speaker 1: absolutely so. So I think what these traditional fiscal impulse
Speaker 1: measures miss is that a lot of the stimus that
Speaker 1: we had last year was saved. We noted about the
Speaker 1: two point four trillion dollars of excess savings that households have.
Speaker 1: There's a couple of hundred billion dollars of state and
Speaker 1: local governments have not spent yet. And so I think
Speaker 1: those typical physical impulse measures of very elevated last year
Speaker 1: UH and very negative over the next year do overstate
Speaker 1: the case. I do think there's gonna be a lot
Speaker 1: more smoothing and the fiscal impulse given that a lot
Speaker 1: of it was saved. But it does highlight the challenge
Speaker 1: we We've had an economy UH since COVID hit that
Speaker 1: has been you know, very significantly supported by massive fiscal
Speaker 1: stimulus and a FED policy that has been incredibly accommodative.
Speaker 1: Two we'll see a reversal of both of those things.
Speaker 1: We think that the economy can you know, weather that
Speaker 1: and still see growth well above trend, But it is
Speaker 1: an open question. And and just to go back to
Speaker 1: the last point, the key question I think for for
Speaker 1: growth in the outlook remains. Can the Fed actually land
Speaker 1: this this uh you know, land this plane in a
Speaker 1: soft landing way and environment where inflation is as we
Speaker 1: saw this morning, at the highest level since the nineties.
Speaker 1: Great stuff, Matt Lozzettie of Deutsche Bank, thank you so
Speaker 1: much for your insight. Appreciate it. Thank you for joining us,
Speaker 1: and Jane Fowley joining a Snatches, the head of effect
Speaker 1: Strategy of Rabbi Bank, got to ask the big question, Jane,
Speaker 1: as we come out of one into me too, does
Speaker 1: this incredible tail when that we've seen for the dollar
Speaker 1: this year continue into next year? I think it can
Speaker 1: certainly continue into the the initial few months and maybe
Speaker 1: wait until the Fed gets going with that interest rate
Speaker 1: hiking net cycle. But you know, we've got to remember
Speaker 1: that there's an awful lot of good news priced into
Speaker 1: the US dollar, and the market has been becoming longer
Speaker 1: and longer of the the U S dollar, and in
Speaker 1: the last few months and since that, that trend really
Speaker 1: did get underway in June, and of course June was
Speaker 1: FOMC where the prospect of an interest rate hiking two
Speaker 1: was initially put on the table, and since then the
Speaker 1: market has become more and more optimistic about the possibilities
Speaker 1: of interest rate hiking, and so there is a lot
Speaker 1: of good news in the price. I think that's why
Speaker 1: we're sort of glued to that one thirteen handling in
Speaker 1: eury dollar right now. I think we need this consolidation.
Speaker 1: I think perhaps we need some pullbacks before the market
Speaker 1: can can really make a decision about you know, don't
Speaker 1: we don't want to build on those long dollar positions more.
Speaker 1: You know what on earth can happen in order to
Speaker 1: to make me do that? So um, I think we
Speaker 1: and have further to go. I'm not so sure if
Speaker 1: if the the the movement up in the dollar can
Speaker 1: can last a full year, though, so we understand the
Speaker 1: risks around European growth at this stage. One of the
Speaker 1: big stories that I think has kind of flown under
Speaker 1: the radar a little bit as we've watched what has
Speaker 1: happened with the FED, what's been happening with the fiscal
Speaker 1: programs in the United States, and of course O Macron
Speaker 1: has been this gas crisis in Europe. Energy prices are
Speaker 1: super high all the way across the continent. They're coming
Speaker 1: down a little bit as we see the arrival of
Speaker 1: some lergy tankers from the United States. But nevertheless they
Speaker 1: remain very very high. We've got very little storage. We
Speaker 1: could potentially be in the same situation next year. And
Speaker 1: rather than this being an inflation threat, Jane, could this
Speaker 1: be a growth threat for Europe? And we underestimating the
Speaker 1: impact that this could have. Yeah, I think you said it.
Speaker 1: I think this is a growth threat and in many
Speaker 1: respects it really doesn't endorse that the very cautious stance
Speaker 1: of of Leguard at the ECB. You know, she has
Speaker 1: continuing to remain davish, continuing with this very supportive monetary
Speaker 1: policies and and I think this is one reason, you
Speaker 1: know why she's you know, justified in doing this. And
Speaker 1: I think, um, you know, we've already heard reports um
Speaker 1: small businesses, bigger businesses really having to to shut her
Speaker 1: because of the additional costs that these energy prices brain.
Speaker 1: But also it's going to be a significant headwind to
Speaker 1: two consumers too, and I think that risk is only
Speaker 1: going to be highlighted, you know during the winter months there.
Speaker 1: Some country Spain comes to mind, have taken some action
Speaker 1: to reduce the the the the bills on for for consumers,
Speaker 1: not coal, cert for industry and that will help, but
Speaker 1: this is certainly a significant headwind for for for business,
Speaker 1: business and consumers in the region. Good morning, Jane. I
Speaker 1: had a lovely chat with your colleague Christian Lawrence and
Speaker 1: Cross assid Strategy yesterday and one area of disconnect was China,
Speaker 1: an area that he tends to avoid at all costs.
Speaker 1: What are your views on the REMIMBI in two. Well,
Speaker 1: you know, if you look at the Chinese economy, we
Speaker 1: know it's slowing, we know that are there are head
Speaker 1: winds there, and it's it's fairly normal. And if we
Speaker 1: had a floating exchange rate to see a currency weekend now.
Speaker 1: I think one of the constraints for for China and
Speaker 1: in terms of the exchange rate was that the very
Speaker 1: very strong PPI inflation numbers that we were getting at
Speaker 1: but they've appeared to started to moderate, and I think
Speaker 1: this is really the key because if we do get
Speaker 1: you know, some indication that inflationary pressures are moderating in China,
Speaker 1: I think at that point the authorities could be more
Speaker 1: comfortable in allowing the exchange rate or the Chinese remember
Speaker 1: to weekend. So I think we are probably gonna see
Speaker 1: certainly more talk of interest rate cuts if we don't
Speaker 1: see more interest rate cuts and in the next few months,
Speaker 1: and I think that too could be associated more with
Speaker 1: more expectation that they will allow the remember to slip
Speaker 1: against the U. S. Dollar. Well, in one area that
Speaker 1: is the void of surprise is Turkey. The lira, which
Speaker 1: had plummeted through eleventh to ten or earlier today, is
Speaker 1: now back through eleven. I mean, these are big figure
Speaker 1: moves in the Turkish lirror. Clearly it's not owners participating,
Speaker 1: it's all driven by locals. What are your thoughts on
Speaker 1: the lyric from the new year? You know, there was
Speaker 1: a very interesting report in the FT that this morning
Speaker 1: making calculations about the level of foreign exchange reserves UM
Speaker 1: and their calculation was that these had dropped by billions
Speaker 1: in a couple of days at the start of this week,
Speaker 1: and and and and the implication was was that we
Speaker 1: had the speech from President argon Um in the course
Speaker 1: of the week, we had this if you like this
Speaker 1: back door interest rate hike as far as retail investors
Speaker 1: that were concerned, and the implication was is that we
Speaker 1: had intervention or they made intervention to to really exaggerate
Speaker 1: at the move. Of course, liquidity conditions are very very
Speaker 1: thin because of the Christmas period too, And and so
Speaker 1: you know that the takeaway from that is that the
Speaker 1: intervention was done at a time which could make her
Speaker 1: can look good, make his measures look good. And actually,
Speaker 1: you know that takeaway really does undermine the credibility of
Speaker 1: the Turkish authorities even further. And I you know, do
Speaker 1: you think that unless we do get an interest rate hike,
Speaker 1: that the majority of investors, institutional investors at least in speculators,
Speaker 1: will continue to think that the Turkish lira remains very vulnerable.
Speaker 1: Jane M Vladimir Putin this morning in his press conference
Speaker 1: talking about Turkey, talking about the impact that policy there
Speaker 1: is having, saying he doesn't want to repeat it in Russia,
Speaker 1: talking about the need therefore for rate hikes um that
Speaker 1: largely seems priced at the moment that nobilianur is going
Speaker 1: to potentially how to do more. But the real threat,
Speaker 1: it strikes me, for the ruble is is actually geopolitical
Speaker 1: and what is happening around sanctions, what's happening on the
Speaker 1: Ukrainian border, what's currently price there? Do you think in
Speaker 1: terms of that geopolitical risk? Well, you know, there's there's
Speaker 1: a lot of interesting topics that you just brought up guying,
Speaker 1: and I think the first thing to say is that
Speaker 1: the credibility of the Russian Central Bank, you know, cannot
Speaker 1: in any way be compared to to Turkey, and the
Speaker 1: Russian Central Bank has a huge amount of credibility, So
Speaker 1: you know, that is one thing, and she's done an
Speaker 1: extremely good job there in these last few years. But
Speaker 1: the other thing I think that's you know, worth pointing
Speaker 1: out with respect to the Russian ruble is that although
Speaker 1: we were talking so much over in the West about Ukraine,
Speaker 1: about the geo political risks, about the tensions between Russia
Speaker 1: and the US, and Russia and NATO, Russia and Europe
Speaker 1: for instance, actually if we look at the ruble, it
Speaker 1: does seem to be retty more driven by the oil
Speaker 1: price and so from from that point of view, we
Speaker 1: haven't had an awful lot of geopolitical impact in there yet. Now. Clearly,
Speaker 1: I think if we were to have, you know, an
Speaker 1: increase in the tensions over Ukraine, that might change, but
Speaker 1: for the time being that's not being nor that is
Speaker 1: not a driving factor or right. Jane Folly of Rabble
Speaker 1: Bank always great to get your insight. Thank you so
Speaker 1: much for joining us. Happy holidays to you and yours.
Speaker 1: Let's bring in Jody Guests, vice chair at Emory University,
Speaker 1: Rowlands School of Public Health, Department of Epidemiology. Jody, as
Speaker 1: we talked about all of these different forces at work,
Speaker 1: what in your mind is the most critical to focus
Speaker 1: on right now? Well, I think getting everyone boosted and
Speaker 1: if you've not yet gotten vaccinated, we certainly want everyone
Speaker 1: to get to vaccine, and we want you to get
Speaker 1: one with an m R and a series and then
Speaker 1: if you've been vaccinated in your six months after that vaccination,
Speaker 1: we really do want to see people get boosted. We
Speaker 1: also want a layer a few other things on that though,
Speaker 1: because O macron is so incredibly transmissible, wearing a mask,
Speaker 1: a very good mask, when you're out in public is
Speaker 1: incredibly important, as is making sure that you're in ventilated spaces.
Speaker 1: And I don't think we've been talking enough about testing,
Speaker 1: although I do think that that conversation has been increasing,
Speaker 1: But knowing when to test, in which kind of tests
Speaker 1: to use is very important. Okay, so let's just talk
Speaker 1: a little bit about that. Packs Lavia is this new
Speaker 1: drug that we have this new anti viral that we
Speaker 1: have from UH from FISA. You need to take it early. Therefore,
Speaker 1: you need to test in order to know when to
Speaker 1: take it. How should we be sequencing testing? Over here
Speaker 1: in the UK? We have a many, many, many lateral
Speaker 1: flow tests. I think I've got a box at home
Speaker 1: of kind of twenty or thirty of them. They give
Speaker 1: them out at schools. So you use the lateral flow
Speaker 1: if you get a positive, then you go and get
Speaker 1: a PCR test which allows the government as well to sequence.
Speaker 1: It allows reporting around that. So how should we be
Speaker 1: thinking about testing and how that fits in with using
Speaker 1: these anti virals. Well, I think right now, with omer
Speaker 1: crime spread across the United States and everyone getting ready
Speaker 1: to gather for holidays, we really want to be talking
Speaker 1: about how to use a rapid anergen test at home
Speaker 1: and recognize what it does and what it doesn't do.
Speaker 1: It does not give you free rein for a week
Speaker 1: if you've had one negative rapid anigin, but it does
Speaker 1: make you feel comfortable that you're not going to be
Speaker 1: infectious if you're getting together with dinner with someone in
Speaker 1: their home, and so you know that window of time
Speaker 1: that you can use in a rapid anigin is appropriate
Speaker 1: for holiday gatherings if you test before you go, but
Speaker 1: if you're going to get together with friends the next day,
Speaker 1: you need another test. And so access to rapid and
Speaker 1: engines and using them at home appropriately it's not something
Speaker 1: we've done very well in the United States, and we
Speaker 1: need to work on that. In terms of using anti virals,
Speaker 1: Then how did they slot in this this new drug
Speaker 1: packs of it? You need to take it within the
Speaker 1: first I don't know, two, three, four or five days
Speaker 1: of being of being hit with a macron. So, so
Speaker 1: how how do we make sure that we use this properly?
Speaker 1: It's an expensive it's an expensive drug. What is it
Speaker 1: six seven hundred dollars for? For of course, how do
Speaker 1: we make sure that we're spending that money effectively? I
Speaker 1: think I saw that it's going to be maybe five
Speaker 1: thirty dollars in the United States. But it's got a
Speaker 1: window as well. And you're right, you need to know
Speaker 1: that you have COVID in order to get this, and
Speaker 1: so you the best use of this new drug series
Speaker 1: is going to be to use it in the first
Speaker 1: three to five days of testing positive or on set
Speaker 1: of symptoms, and so um we also want to be
Speaker 1: using it. It works the best for people who are
Speaker 1: at at risk for severe complications for COVID nineteen. So
Speaker 1: that's a group that are I hope would have a
Speaker 1: high sensitivity to wanting to test that folks who are
Speaker 1: living with underlying conditions, or our older age, or have
Speaker 1: things like diabetes and obesity and things that we know
Speaker 1: complicate the course of COVID nineteen. That's really where're gonna
Speaker 1: see plex i woid work the best and where we
Speaker 1: see the best data so far, Jody, we spend so
Speaker 1: much time harping on the bad news related to the coronavirus,
Speaker 1: but there has been some incredible progress on the medical front.
Speaker 1: I mean both specifically we you know we mentioned the
Speaker 1: fiser oral pill, but also you in the U. S.
Speaker 1: Army Walter Read Institute also announced yesterday that you know,
Speaker 1: they've made some progress in terms of a virus that
Speaker 1: not only affects you know, uh COVID, but also any
Speaker 1: stars sort of related UM disease. My question for you
Speaker 1: is what has you what advancements in epidemiology have you
Speaker 1: most excited? As we turned to two Well, I think, um,
Speaker 1: you know, he's been a long two years. But what
Speaker 1: we've seen is people are paying attention to public health,
Speaker 1: and um, we don't normally lead with a lot of
Speaker 1: conversations about people even knowing what epidemiologists are. So that
Speaker 1: has definitely changed. But the passion of our students and
Speaker 1: what they're seeing as they as they learn about public
Speaker 1: health during this pandemic, I think it's really going to
Speaker 1: change the way public health moves forward. We're really focusing
Speaker 1: on good science, communication and talking about inequities. COVID nineteen
Speaker 1: has consistently taken advantage of inequities and healthcare and access
Speaker 1: and and we need to be talking about that in
Speaker 1: order to be willing to do something about it. And
Speaker 1: so I think that that is one of the silver
Speaker 1: linings of COVID nineteen, is making us talk about it
Speaker 1: and making us face it. Jody, you know, I've also
Speaker 1: heard that oh Macon doubles the risk of being infected
Speaker 1: on a plane. You know, a lot of people are
Speaker 1: traveling this holiday season. On myself, I mean, well, Tom
Speaker 1: King's not sending the private jet to come pick me up,
Speaker 1: so I'll be on a plane, um with a lot
Speaker 1: of other people on on Saturday. You know, for me,
Speaker 1: you know, how concerned should travelers be this holiday season? Well,
Speaker 1: omer crowd is much more transmissible than we saw with Delta,
Speaker 1: and we thought Delta was awammy um omercron when when
Speaker 1: it is in a space, everyone there is much more
Speaker 1: likely to get it than we've seen with other variants.
Speaker 1: And airplanes have been very safe way to travel based
Speaker 1: on the way that air circulates, and in airplanes, we've
Speaker 1: not seen a lot of transmission from the actual airplane.
Speaker 1: It's more what you're doing to get onto that plane
Speaker 1: that has been a risk for people. And so you know,
Speaker 1: we're just working with something that's so much more transmissible.
Speaker 1: Now every place that you are with other other people
Speaker 1: is a bigger risk than it was even with Delta.
Speaker 1: A lot of factors that people are calculating into the
Speaker 1: equation when deciding what to do this holiday season. Thank
Speaker 1: you so much to Dr Jody Guest of Emory University,
Speaker 1: and happy holidays to you and your zone. This is
Speaker 1: the Bloomberg Surveillance Podcast. Thanks for listening. Join us live
Speaker 1: weekdays from seven to ten am Eastern on Bloomberg Radio
Speaker 1: and on Bloomberg Television each day from six to nine
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Speaker 1: the terminal. I'm Tom Keene, and this is Bloomberg.