Speaker 1: This is Bloomberg Business Week. I'm Carol Masser and I'm
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Speaker 1: But Elon Musk used to being in the driver's seat
Speaker 1: or seats considering all that he's involved, and sometimes that
Speaker 1: even means driving some Twitter founders to a competing social network.
Speaker 1: It's kind of like, wait, what are you doing? This
Speaker 1: is really interesting with who and where they're going in
Speaker 1: the latest on the Twitter situation. Here with us is
Speaker 1: at Bloomberg News Technology reporter Alex Brenka. She joins us
Speaker 1: on camera from our l A bureau. Alex, good to
Speaker 1: have you back with us. Uh Mastodon, what is going
Speaker 1: on with Mastodon? And if you haven't heard of Massodon.
Speaker 1: I'll also kind of just explain it to you. It's
Speaker 1: this kind of new ish social network that a lot
Speaker 1: of folks who perhaps are unhappy with Twitter or who
Speaker 1: are looking for a different platform to share news or
Speaker 1: short purse of information have been migrating to Massadon. Now,
Speaker 1: Mathadon started is kind of a techie community. Um. They
Speaker 1: call their kind of groups, servers or instances. Initially it
Speaker 1: was a lot of folks who were kind of deep
Speaker 1: in tech, but they started to attract a general audience,
Speaker 1: including a couple of really notable names like Twitter co
Speaker 1: founders Biz Stone and Ev Williams, who have now moved
Speaker 1: on the platform and said they are taggering and trying
Speaker 1: it out. A big complaint that I've heard about Mastodon
Speaker 1: and full disclosure, I have not tried it. I've tried post.
Speaker 1: I'm on post news, but I haven't like signed in
Speaker 1: in two weeks. This is what happens, by the way,
Speaker 1: with competing social networks, UM is that it's complicated that
Speaker 1: mass Diodon is like, it's kind of tough to find servers.
Speaker 1: What has your experience been based on what you've done,
Speaker 1: and also like the people you've spoken to you know,
Speaker 1: someone someone on Twitter uh compared it to like using
Speaker 1: Linux as an operating system. It sort of is, you
Speaker 1: know it is um. It's open source software that has
Speaker 1: these communities on it. I've gotten on it, and I'll
Speaker 1: tell you I had the same experience. It's um kind
Speaker 1: of gorpy, it's kind of tricky. I don't quite know
Speaker 1: how to use it. I only have a whopping three
Speaker 1: followers there versus you know, almost eight thousand on Twitter. UM,
Speaker 1: so there's a lot of differences. I also don't think, frankly,
Speaker 1: if I were to go to my non tech friends
Speaker 1: and say, hey, try this thing, they wouldn't know how
Speaker 1: to sign up either. So I think that's one of
Speaker 1: the kind of uh hills to climb for mass it on,
Speaker 1: and also probably why they're excited to be kind of
Speaker 1: connected with Ev Williams Um, that Twitter co founder in particular.
Speaker 1: You'll remember Ev also founded a blogging platform called Medium,
Speaker 1: and in this kind of shift over to mass it on,
Speaker 1: Medium has set up its own instance, its own server
Speaker 1: or community, where it's going to set its own rules
Speaker 1: and encourage its authors to go over there and perhaps
Speaker 1: bring some of their users. UM. As of recently, even
Speaker 1: after this rush of new users massed on and said
Speaker 1: that they have about two point five million people using
Speaker 1: the platform. Compare that to the around two hundred and
Speaker 1: thirty million daily active users that Twitter has. So a
Speaker 1: bit more tricky, it's not as user friendly, and they
Speaker 1: don't have the user base. But it's really interesting that
Speaker 1: some of the moves that Twitter is making is is
Speaker 1: forcing some people to even jump onto a platform that
Speaker 1: has a few more hurdles than something like Twitter might.
Speaker 1: Alex makes me think, Okay, if somebody can set something
Speaker 1: up that can really challenge Twitter, you could quickly see
Speaker 1: people move to it. At the same time, it made
Speaker 1: me think, you know what Twitter's power is. They've got
Speaker 1: so many people already in that universe and that's where
Speaker 1: you know, the tricky wick is what does Ellen do
Speaker 1: with it and to keep those people there. Yeah. Absolutely,
Speaker 1: you've seen some changes in recent days. Right now, your
Speaker 1: feed is now split. There's your following feed, which is
Speaker 1: like the old school Twitter feed are the folks that
Speaker 1: you've chosen to follow. And I also have something called
Speaker 1: my four you feed now, which for folks who watched
Speaker 1: the social media industry that seems to be lifted from TikTok,
Speaker 1: who has an algorithmically kind of driven for you feed
Speaker 1: that is interesting too. On Twitter, My Twitter currently has
Speaker 1: a for you and it has a following. The for
Speaker 1: you are the for you people interspersed within your timeline,
Speaker 1: Like I've noticed, my timeline is full of people that
Speaker 1: don't follow. Is that what you mean? That's what I mean.
Speaker 1: It's full of people I don't follow, and I'm seeing
Speaker 1: things like tweets from two days ago. I'm seeing things, uh,
Speaker 1: like tweets about topics that I haven't historically kind of
Speaker 1: engaged with. So this could be a play from Twitter
Speaker 1: to try to drive engagement, to kind of lift some
Speaker 1: of the tactics that TikTok's using that Instagram has borrowed
Speaker 1: from TikTok of introducing you to new kind of interest
Speaker 1: areas or new people to get you more engaged on
Speaker 1: the platform. Whether or not that bears out in more
Speaker 1: engagement and more users in more advertise or interest, that
Speaker 1: will be kind of a to be determined. But it
Speaker 1: does seem like as folks like Massadon and even you
Speaker 1: know Instagram TikTok LinkedIn start to take some of the
Speaker 1: typical users away from Twitter, it seems like they have
Speaker 1: to try some new things. Why doesn't Why doesn't um,
Speaker 1: Facebook just do this? Facebook has the people, right, you know,
Speaker 1: there's so many people who are on Facebook and Instagram.
Speaker 1: Why don't they try to sort of, I don't know,
Speaker 1: become a place where for for people who are disenfranchised
Speaker 1: or field disenfranchised by Twitter. Is they're building the metaverse?
Speaker 1: Come on, Tim, did you not get the mask? Alex? Okay,
Speaker 1: they're building the metaverse, but they're also it's part of it.
Speaker 1: But they're also investing a lot in AI that's not
Speaker 1: only applicable to photos and videos, but also to tax
Speaker 1: So it seems like whether you're interested in something that
Speaker 1: could be a place to go. But for someone like
Speaker 1: me in the journalism industry, for folks who care about
Speaker 1: finance news, um, for folks who are you know, a
Speaker 1: lot of the news so says Twitter has kind of
Speaker 1: in the space for that. Facebook, on the other hand,
Speaker 1: has gotten into a lot of trouble um for its
Speaker 1: dealings in misinformation. Um that's been a bit of a
Speaker 1: debate now on Twitter. But when when you think about
Speaker 1: like why you go to certain platforms, Uh, Facebook seems
Speaker 1: to be meta with Facebook and Instagram, moving in a
Speaker 1: little bit of a different direction than where Twitter has
Speaker 1: historically been as a kind of de facto place of news,
Speaker 1: political conversation, and conversation around live events like the Super
Speaker 1: Bowl or major sports event. All right, alex so net Net,
Speaker 1: does Ellen need to be worried about mastadon? I think
Speaker 1: right now the users don't don't give him any worry. Um,
Speaker 1: But in the future, if folks continue flocking there, then
Speaker 1: you know, I think he's a lot of worries on
Speaker 1: his table and this might be another one. All right,
Speaker 1: while we're talking about worries, what about Twitter employees? You know,
Speaker 1: there's another story on the terminal talks about workers at
Speaker 1: Twitter Singapore office told to empty at their desks, vacate
Speaker 1: the premises. According to those familiar as Ellen must continues
Speaker 1: to pair expenses around the globe. All right, so that's
Speaker 1: like go to work from home, but you do wonder Okay,
Speaker 1: do that and then maybe what's the next step. But anyway,
Speaker 1: I'm just reading into this, maybe incorrectly, but how do
Speaker 1: you see it? Yeah, so this is kind of one
Speaker 1: of the moves that we're seeing happen under mask where
Speaker 1: costs are being cut basically the offices the leases are expiring, UM,
Speaker 1: they need to kind of figure out another plan. Twitter
Speaker 1: employees have have had a lot of whiplash lately, UM,
Speaker 1: and it seems like there's been kind of a month
Speaker 1: long refocusing on things. So whether you're working from home
Speaker 1: and that's kind of changing your day to day, whether
Speaker 1: it's you know, changing the feed like we've seen, whether
Speaker 1: it's trying to roll out new kind of valuable offerings
Speaker 1: to advertisers, a lot of which have left or pause
Speaker 1: spending on the platform. The Twitter employees that are left
Speaker 1: are not only doing their jobs but also having to
Speaker 1: deal with a little bit of the chaos UM that
Speaker 1: we've seen over the last few months. So Singapore is
Speaker 1: one of the offices. We'll see if they continue to
Speaker 1: kind of shrink their footprint and shift to a UM
Speaker 1: kind of grand work from home model, which Ellen has
Speaker 1: also said he is not interested in. UM. So I
Speaker 1: think that the read through is the chaos or the
Speaker 1: whiplash seems to kind of continue for folks both on
Speaker 1: the platform and those behind the scenes who are keeping
Speaker 1: the lights on. Is it just me Alex or is
Speaker 1: Elon Musk kind of toned it down a bit on Twitter.
Speaker 1: Over the last couple of weeks, he's been a little quieter.
Speaker 1: I don't know if that's the holidays, or if that's
Speaker 1: the New year rush, or if their annual planning, but
Speaker 1: it does seem like the drama has calmed down. But
Speaker 1: you remember, there's some big beads still to come, right.
Speaker 1: He said they're looking for a new CEO to take
Speaker 1: over a lot of the operations. He's got a big
Speaker 1: debt bill do in January, so I think we'll still
Speaker 1: have enough drama and fodder to talk about even if
Speaker 1: he's not taking it to Twitter and listen, he told
Speaker 1: us at fourteen hours ago, maybe we should spend less
Speaker 1: time on social media. I mean, come on, he's got
Speaker 1: other things to Oh my god, it's going to be
Speaker 1: an interesting year. Um, Alex Brenka, thank you as always.
Speaker 1: We're getting a double dose of Alex this week and
Speaker 1: really good to check in with their um Twitter. Yeah,
Speaker 1: well see, we'll see you are going to try mastered
Speaker 1: on No, there's also post news which post news? Do
Speaker 1: you are you on it? I'm on that, but I
Speaker 1: haven't been. Do you use it? No? I haven't been.
Speaker 1: I gotta get this is the guy who liked eletes
Speaker 1: Twitter and then put it back on. Yeah, it's just
Speaker 1: I'm an addict, no offense. I loved him, but I
Speaker 1: don't know that I'm going to follow you follow me
Speaker 1: on Twitter. I follow you on Twitter, but I don't
Speaker 1: want to follow what you do here. Thanks, Hey, thanks
Speaker 1: Thanks co anchor Carol Heart Love Love Love. You're listening
Speaker 1: to Bloomberg Business Week with Carol mess Here and Tim
Speaker 1: Stenovic on Bloomberg Radio. All Right, we talked earlier about
Speaker 1: today's CPI report. The US is making progress, it seems
Speaker 1: on inflation. Uh. It has also made progress on COVID,
Speaker 1: and yet we also talk a lot about how we're
Speaker 1: not completely over the pandemic, how a new omicron sab
Speaker 1: variants out and the cases are once again rising around
Speaker 1: the United States. Back with us for an update on
Speaker 1: the virus and where we are in the US and
Speaker 1: around the world. We've got Dr Amish Adulges, senior scholar
Speaker 1: and infectious disease physician at the Center for Security at
Speaker 1: the Bloomberg School of Public Health. It is of course
Speaker 1: supported by Michael R. Bloomberg, the founder of Bloomberg LP
Speaker 1: and Bloomberg Philanthropies. He joins us from Pittsburgh this afternoon.
Speaker 1: Dr A. Dodge, It's good to talk with you again.
Speaker 1: It's been a while, which I guess is kind of
Speaker 1: good because you know, it's it's not good when we
Speaker 1: were speaking with you every single week and the only
Speaker 1: thing we were talking about was COVID. But like you said,
Speaker 1: you know, over the last two and a half years,
Speaker 1: as we've been talking to you, this is a virus
Speaker 1: that's going to change. It's a virus that's here to stay.
Speaker 1: How are you looking at it being part of our
Speaker 1: lives right now? I'm looking at it as something that
Speaker 1: we are going to continue to have to deal with
Speaker 1: that people are going to have to continue to learn
Speaker 1: how to risk calculate within science and technology are going
Speaker 1: to continue to have to advance to give us new
Speaker 1: tools to be able to make it as manageable as possible.
Speaker 1: But I do think that it's going to be something
Speaker 1: that is always going to be generating new variants and headlines.
Speaker 1: But it's something that is now much like other respiratory
Speaker 1: viruses because of all of those tools that science and
Speaker 1: medicine have given them. So Okay, I mean it's interesting,
Speaker 1: Like I think, first of all, I can't believe we're
Speaker 1: what two years out here now three years out um,
Speaker 1: so much has happened, so much in terms of how
Speaker 1: we think about these things and understanding that on a
Speaker 1: health basis, you know, the unthinkable can hit a developed
Speaker 1: in many developed nations like the US and others. So
Speaker 1: way forward here, Um, I think about this a lot.
Speaker 1: Five shots in, I mean, do I just have to
Speaker 1: keep getting shots? Well? I think if you're somebody that's
Speaker 1: of average risk, that you don't have any high risk conditions,
Speaker 1: that you're not older, you don't have harder vascular disease,
Speaker 1: you don't have obesity, you're not pregnant, immunocompromise. The actual
Speaker 1: regular vaccine, the standard dose does hold up really well
Speaker 1: against what matters serious illness, hospitalization and depth and boosting
Speaker 1: is really important for people that have risk factors for
Speaker 1: severe disease. I don't think that for the average healthy person,
Speaker 1: boosters do much. They don't cause it harm, but they're
Speaker 1: not really going to give you much protection against infection
Speaker 1: because this virus has sort of evolved away from being
Speaker 1: able to be protected by our first generation vaccines. And
Speaker 1: I think it's really about protection against serious illness, when
Speaker 1: it comes to vaccines and boosters, maybe we'll get better
Speaker 1: vaccines that are more that are more broad, that are
Speaker 1: not as susceptible to being kind of kind of limited
Speaker 1: by variants. But right now with these first generation vaccines,
Speaker 1: is really about protection against serious illness, and that's why
Speaker 1: I think boosters should be targeted to high risk individuals.
Speaker 1: That's really surprising to hear from you. I mean, I
Speaker 1: thought the general guidance was everybody who's eligible should be
Speaker 1: getting a booster. I've always been sort of a booster skeptic.
Speaker 1: I thought that when you look at what the vaccine
Speaker 1: was doing, it was protection against serious illness, hospitalization, and depth,
Speaker 1: and so you have to actually have a baseline risk
Speaker 1: of that for the boosters to give you benefit. And
Speaker 1: what we see is the boosters don't really do so much,
Speaker 1: especially in the age of omicron, when it comes to
Speaker 1: protection against infection. What they really do is protect you
Speaker 1: against serious illness. So that's why I think it's really
Speaker 1: almost mandatory that if you're old there and have or
Speaker 1: any high risk condition, you should be boosted. And in fact,
Speaker 1: I think we we have kind of this wrong situation
Speaker 1: in the United States where there are people who are
Speaker 1: at low risks, who tend to be boosted to a
Speaker 1: very high degree. And then you look at the three
Speaker 1: hundred to four hundred people that die every day in
Speaker 1: the United States from COVID, and none of them are boosted.
Speaker 1: So I think that we diluted the message by pushing
Speaker 1: for universal boosting, and the people who actually needed to
Speaker 1: be boost who needed to hear that they should prioritize
Speaker 1: getting boosted, that really didn't reach them. And I think
Speaker 1: that's the problem. You know, we nursing home residents to
Speaker 1: be boosted, not healthy thirty year olds. Is there a
Speaker 1: difference between the antibodies that are formed as a result
Speaker 1: of getting boosted versus the antibodies that are formed as
Speaker 1: a result of a prior prior infection. Not? Not. Really,
Speaker 1: they're in the same general category. There may be some
Speaker 1: tweaks depending upon which variant you are infected with, which
Speaker 1: booster you've got, If you've got the original booster, the
Speaker 1: bi valent booster, how strong they are, and and there
Speaker 1: is some evidence that you're getting repeated boosters. You don't
Speaker 1: even with the bible and booster, you don't make different
Speaker 1: types of antibodies. You still continue to overwhelmingly make the
Speaker 1: antibody to the one virus that you first were exposed to,
Speaker 1: or the one type of slike protein you were first
Speaker 1: exposed to. That's something called imprinting, which is a little
Speaker 1: bit complicated, but in general, the bottom line of boosters is, yes,
Speaker 1: they're helpful, but it's really about protecting a high risk
Speaker 1: populations with them, not necessarily the average person. And I
Speaker 1: think what's surprising to me is just the anecdotal And
Speaker 1: you know, it's so dangerous to use anecdotes when it
Speaker 1: comes to anything about medicine, because medicine is you know,
Speaker 1: when we would you get this stuff. It's approved, it's
Speaker 1: pure viewed, there are follows the scientific method and so on.
Speaker 1: You know. But it's like, Okay, my mother in law
Speaker 1: comes and stays with us. It turns out she had
Speaker 1: COVID the whole time, you know, and the three of
Speaker 1: us don't end up getting COVID. And I kind of
Speaker 1: attribute to that too, well, okay we previously had COVID
Speaker 1: or because we were recently vaccinated. I don't know, Dr Adulge.
Speaker 1: It's like hard to explain this stuff that you know,
Speaker 1: you feel protected, but you don't necessarily feel protected. Yeah,
Speaker 1: there's a lot of variables that really influence whether somebody
Speaker 1: gets infected. When was the person that you're exposed to,
Speaker 1: When where they contagious? What kind of immunity do you have?
Speaker 1: We know now that people who have hybrid immunity, a
Speaker 1: combination of being vaccinated plus natural infection have the strongest
Speaker 1: type of immunity. How fresh was your last vaccine or
Speaker 1: booster or last infection, all of that plays a role
Speaker 1: in how likely somebody is to get infected. And it's
Speaker 1: there's a lot of variables that that are at play,
Speaker 1: but it's this is a ubiquitous virus, and we're always
Speaker 1: going to be getting exposed to it. We're always going
Speaker 1: to know someone that has covid uh. This is now
Speaker 1: part of kind of the infectious disease mill you that
Speaker 1: we all will face, you know, all humans will face,
Speaker 1: you know, for the foreseeable future on this planet. All right,
Speaker 1: So if we are thinking about moving beyond this one,
Speaker 1: the coronavirus or covid um, is there another one that's
Speaker 1: likely to hit us probably in a few years or sooner.
Speaker 1: I mean, is that just kind of the fabric of
Speaker 1: our life now? Well? And not now it's always been
Speaker 1: the fabric of our life. If you look at the
Speaker 1: history of the human the human species on this planet,
Speaker 1: it's been pandemic, epidemic, famine, infectious disease threat after infectious
Speaker 1: disease threat. It's only in the last hundred or so
Speaker 1: years where we've had somewhat of arrestpite because of sanitation,
Speaker 1: because of the development of vaccines, because of the development
Speaker 1: of antibiotics and modern medicine. But for you know, if
Speaker 1: you talk to somebody, if you look at that, if
Speaker 1: you plot the whole human species time on this planet
Speaker 1: on almost just a little lit bit from around nineteen
Speaker 1: oh I think we're having some problems with that cell
Speaker 1: phone target. If you want to finish your thought in
Speaker 1: terms of like historical you say, this has always been
Speaker 1: a part of it, but it really in modern times
Speaker 1: it feels like it hasn't, right, I think, but only
Speaker 1: because we kind of had the luxury of vaccines and
Speaker 1: sanitation and antibiotics and anti virals. But if you look
Speaker 1: at the the entire world, you know there were still
Speaker 1: tens of thousands of people dying from measles. Uh. Even
Speaker 1: in the United States we have tens of thousands dying,
Speaker 1: I mean flenz. I think that was kind of a
Speaker 1: false sense of security, just based on the fact that
Speaker 1: people weren't paying attention to what was going on in
Speaker 1: the infectious disease world. So it's hard to predict when
Speaker 1: the next pandemic will be. But it's it's always not
Speaker 1: a question of whether one will occur. It's it's it's
Speaker 1: when it occurs, it's not if. And there are other viruses,
Speaker 1: other respiratory viruses, flu viruses, particularly topical list including AVI
Speaker 1: and flu viruses that that I think we have to
Speaker 1: continue to prepare for you. I've heard also just the
Speaker 1: general flu or the seasonal flu. This this time around
Speaker 1: has been really rough on a lot of people. Um
Speaker 1: Dr Amos Sadalja, thank you so much, appreciated senior scholar
Speaker 1: and infectious disease physician at the Center for Health Security
Speaker 1: at the Bloomberg School of Public Health. Supported as you
Speaker 1: know by Michael R. Bloomberg, Founder, Bloomberg ALP and Bloomberg philanthropist,
Speaker 1: joining us on the phone from Pittsburgh. I don't know
Speaker 1: about you. I mean, I'm gonna probably still if I can.
Speaker 1: I was surprised to hear those comments about boosters that
Speaker 1: he made. But it's he's right that you know, it
Speaker 1: needs they need to get to the people who really
Speaker 1: need it. Yeah, but I also I'm watching China because
Speaker 1: its delinations, you know, fighting it. These is Bloomberg Business
Speaker 1: Week with Carol Messer and Tim Stanovic on Bloomberg Radio.
Speaker 1: The new issue of Bloomberg Business Week. It is out
Speaker 1: on newsstands, online at Bloomberg dot com, slash business Week
Speaker 1: and of course always on the Bloomberg Terminal. It's the
Speaker 1: annual the Year Ahead issue, the major trends, disruptions, breakthrough products,
Speaker 1: innovations and movements to watch in the coming year. It
Speaker 1: compliments this week's Bloomberg Live event in Davos that's happening
Speaker 1: as the World Economic Forum hosts its annual meeting there,
Speaker 1: and the cover story has to do with the economic outlook.
Speaker 1: It's written by Stephanie Flanders. She's Bloomberg News Senior Executive
Speaker 1: editor for Economics and the Government. She's here with us
Speaker 1: now in the Bloomberg Interactive Brokers studio. It's a real
Speaker 1: treat to have her on this side of the pond
Speaker 1: because she's usually of course based in our London office.
Speaker 1: Stephanie how are you. I'm alright, I'm alright looking at
Speaker 1: the year ahead. Yeah, well, let's talk about the year ahead,
Speaker 1: because you're write about these three pillars that kind of
Speaker 1: held together the global economy. Was helpful to have low rates,
Speaker 1: but it's also helpful to have a kind of a
Speaker 1: conflict free world, you know, notwithstanding some minor conflicts here
Speaker 1: and there. And then also of course energy prices were
Speaker 1: kept low for for quite a while. If we look
Speaker 1: back on those pillars are kind of crumbled. Yes, And
Speaker 1: that's what I was thinking. So what's useful about doing
Speaker 1: this exercise for for Business Week? And I have done
Speaker 1: it a few years now? Is you sort of Obviously
Speaker 1: you're quite caught up in especially these days, on exactly
Speaker 1: what's going to happen to the economy this year? And
Speaker 1: are we going to get at heads around inflation? Is
Speaker 1: the FED going to stop tightening? But you also want
Speaker 1: to step back and think, okay, what how is the
Speaker 1: world fundamentally changed? And I think this was one of
Speaker 1: those years where I thought, Wow, we really have had
Speaker 1: these fundamental assumptions underpinning maybe thirty forty years of global
Speaker 1: economic history. Certainly my lifetime of thinking about economics and
Speaker 1: thinking about the world all having kind of been kicked
Speaker 1: away over the last couple of years. It's not just
Speaker 1: cheap energy prices, it's not just cheap labor costs and
Speaker 1: transportation costs. And as you said, the sort of friction
Speaker 1: free period for geopolitics, at least when it came to
Speaker 1: you know, am I going to find it fairly easy
Speaker 1: to set up a complicated supply chain in Asia or China?
Speaker 1: And all of that has gone away. And then on
Speaker 1: top of all that, you know you kind of every time,
Speaker 1: but any one of those pillars was sort of shaky.
Speaker 1: You always had the FED put right, You always had
Speaker 1: the FED there um super easy money, kind of free
Speaker 1: money to make everything still make the numbers still add up.
Speaker 1: And when you start looking ahead and thinking, okay, if if,
Speaker 1: if those have gone in quite a lasting way, decoupling
Speaker 1: whatever you want to call it, as well as potentially
Speaker 1: kind of higher interest rates sticking around for a while,
Speaker 1: you know that that could mean something quite fundamental, not
Speaker 1: just for economic growth, but also for global politics. You know,
Speaker 1: we talk about pivots, and I do think about Stephanie,
Speaker 1: is it just a case of a reset? Certainly here
Speaker 1: in the United States, but elsewhere this whole dea of
Speaker 1: cheap money no more. Yeah, and I think I mean,
Speaker 1: as you know, I'm normally in London and that the
Speaker 1: sheer pace of change there has been extraordinary. I mean people,
Speaker 1: you know, the difference between getting a mortgage in July
Speaker 1: and getting it in September, partly thanks to the sort
Speaker 1: of craziness we had in Parliament, but actually not just
Speaker 1: that you had rates double or treble. In many cases,
Speaker 1: people are going to be going up in the next
Speaker 1: few months, renegotiating their mortgages and going from a one
Speaker 1: percent rate to six and they're going to fail their
Speaker 1: affordability tests and you know, so, yeah, we don't know
Speaker 1: how that's going to play out. Well, how do you
Speaker 1: think about this, Like this whole idea of the Fed
Speaker 1: still thinks they're going to get down to two percent
Speaker 1: right in terms of inflation, and that that's their target.
Speaker 1: There are many people say, no, way, things have changed dramatically.
Speaker 1: How do you think about that globally? Like has something
Speaker 1: is it different this time around? Is there kind of
Speaker 1: a new rate because of some global macro forces that
Speaker 1: have changed forever? Yeah? I think so, there's as you know,
Speaker 1: a big debate about this, and there are plenty of
Speaker 1: economists on both sides as always, so we can keep
Speaker 1: about keep up the debate. But I think, um, it's
Speaker 1: gonna I think this year it's going to depend quite
Speaker 1: a lot on China. So you have the very rapid
Speaker 1: reopening actually may be unhelpful to the j pals of
Speaker 1: this world, because, as you know, we could then see
Speaker 1: maybe an extra one percentage point, maybe an extra two
Speaker 1: percentage points on global inflation just because of faster China
Speaker 1: growth and higher energy prices from that. But looking further ahead,
Speaker 1: has there been a more fundamental shift between the relationship
Speaker 1: between unemployment and wages? You know, we've had all these
Speaker 1: years where you had super low unemployment, you know, very
Speaker 1: tight labor market, but wages didn't budge. Now you know,
Speaker 1: the dam is kind of broken, and you have got
Speaker 1: these much bigger wage rises coming down the track in
Speaker 1: many countries. If they get locked in, then you're right,
Speaker 1: you know, we're in a we're in a different world.
Speaker 1: You right at the end of the piece that the
Speaker 1: microeconomic trend for three is going to be near shoring
Speaker 1: the idea of untangling some of these fly chains that
Speaker 1: companies have spent a generation building as they've gotten concerned
Speaker 1: about Okay, maybe COVID zero in China or trade relationships
Speaker 1: with countries including China. Um, how do you think that's
Speaker 1: going to continue to play out, Because at the same time,
Speaker 1: it does seem like labor is so you know, you
Speaker 1: don't want to you don't want to unravel too much
Speaker 1: in a company like Apple, for example, is so inextricably
Speaker 1: bound to a to a country like China. And I
Speaker 1: actually think that's one of the fundamental tensions. And that's
Speaker 1: actually it's why I've I've set up a whole squad.
Speaker 1: Now I've got control of the economics and government. Here
Speaker 1: at Bloomberg, We've got a geoeconomic squad. And precisely because
Speaker 1: the economics and the politics is really kind of coming
Speaker 1: into into tention at the moment. I don't think any
Speaker 1: of these big companies wanted niche near shore. Particularly, it
Speaker 1: wouldn't be their first choice. They certainly it wouldn't be
Speaker 1: their choice to come out of China, and they're resisting
Speaker 1: that in many areas. But they're also looking at the
Speaker 1: riding on the wall. But as the geopolitical trends that
Speaker 1: we talked about, from the last thirty years have gone
Speaker 1: into reverse. You know, the politicians in sense and no
Speaker 1: longer on the side of closer and closer integration and globalization.
Speaker 1: So I think businesses for the first time in a
Speaker 1: long time, have to reckon with you know, if you
Speaker 1: like the kind of the current of history running against them.
Speaker 1: You know, whereas previously, you know, in most places people
Speaker 1: wanted to make things easier for global business, that's not
Speaker 1: the case. Now you've got President Biden, You've got politicians
Speaker 1: all around the world actively making their lives harder. Um,
Speaker 1: it feels kind of glum if you're not alone. Even
Speaker 1: the good news in China is exactly like and there's
Speaker 1: a lot of individuals. So maybe it's not so great
Speaker 1: in the first half, better in the second half. But
Speaker 1: I think there's a lot of debate over that too.
Speaker 1: Could things actually come in better? Could the US fear
Speaker 1: better too than the rest of the world? Are are
Speaker 1: a lot of the world. Yeah, And actually I even
Speaker 1: say that there. I think there's a scenario which says, um,
Speaker 1: the US dodges recession or has a very shallow recession.
Speaker 1: Even in the Eurozone, it's looking like I don't think
Speaker 1: my optimism extends to the UK at last, but in
Speaker 1: the Eurozone it's looking like it's going to be a
Speaker 1: very shallow recession, and quite a lot of the country's
Speaker 1: may even dodge a formal recession. If we get to
Speaker 1: the end of the year and central banks have also
Speaker 1: kind of have basically got control of inflation, and that
Speaker 1: we are within sight of two, then as I say
Speaker 1: at the end of the piece, everything does become a
Speaker 1: bit easier. You know, we may still have these structural trends,
Speaker 1: these question marks, but it's on a slower burn and
Speaker 1: you're not talking about these relationships just kind of going
Speaker 1: up in smoke. Definitely, does it feel since you've said,
Speaker 1: you've done this a couple of times for Business Week,
Speaker 1: kind of setting what the economic outlook is for the year,
Speaker 1: does it how does it feel different from last year?
Speaker 1: Do you remember like does it feel more certain or
Speaker 1: still uncertain? But different debates. I think the fundamental sort
Speaker 1: of narratives are actually clearer, and actually going back to
Speaker 1: that point of geoeconomics, I sort of feel like I
Speaker 1: know what the story is or what the different elements
Speaker 1: of the story are going forward, but of course I
Speaker 1: never know what's going to happen, and that's what makes
Speaker 1: life so interesting. Okay, thirty seconds just to end on
Speaker 1: Russia's invasion of Ukraine. I think it's been most a
Speaker 1: full year, uh at the end of February and thirty
Speaker 1: seconds against Stephanie, I mean, how does this How does
Speaker 1: this play out in Europe? I would say one positive.
Speaker 1: I mean, of course it's a massively negative event for
Speaker 1: the continent to have a war on its on its shots.
Speaker 1: But the way that Europe has hung together, not just
Speaker 1: the governments but the people I think is a source
Speaker 1: of inspiration and potential optimism. We'll just we'll see how
Speaker 1: whether they managed to carry that forward. Well, it's a
Speaker 1: great set up for the year, which should turn out
Speaker 1: to be. It sounds like another interesting one, Stephanie, Thank
Speaker 1: you so much, really appreciate it. Stephanie Flanders. Of course,
Speaker 1: she's senior executive editor for Economics and Government here at
Speaker 1: Bloomberg News. This is the cover story of the new
Speaker 1: issue of Bloomberg Business Week. It's the year ahead issue.
Speaker 1: You can find it on newsstand. You can find it
Speaker 1: online at Bloomberg dot com, slash business Week, and of
Speaker 1: course always on the Bloomberg terminal. You're listening to Bloomberg
Speaker 1: Business Week with Carol Messer and Tim Stenovic on Bloomberg
Speaker 1: Radio and Shares of Disney. They're up again. They're now
Speaker 1: up about four this year. Last night a flur of
Speaker 1: headlines as the company squares off against activist investor Nielson Peltz,
Speaker 1: who nominated himself to the board. What happens though, now
Speaker 1: is the responsibility of longtime CEO Bob Iger, who, as
Speaker 1: you all know, he retired. Then he came back to
Speaker 1: run the company late last year. So there's a lot
Speaker 1: going on here. Yeah, We've got a great group of
Speaker 1: voices with us this afternoon. We've got Bloomberg News Entertainment
Speaker 1: nitor Chris Paul Mary, who's on the phone from l A.
Speaker 1: He's going to give us the news, and then we
Speaker 1: get some more analysis from Bloomberg Intelligence Technology and media
Speaker 1: analysts Gita ron Ganathan, who's with us via zoom from
Speaker 1: our Bloomberg Intelligence headquarters in Princeton, New Jersey. Chris, I
Speaker 1: want to start with you because I met this comment
Speaker 1: to Carol earlier today. Uh, Bob Iger, the return of
Speaker 1: the Bob. He has not wasted any time in undoing
Speaker 1: some of the changes that his predecessor and successor, I
Speaker 1: don't know if there's a word for predecessor and successor. Uh.
Speaker 1: Bob Japeck made starting with, you know, some some rules
Speaker 1: at uh the parks, some rules at corporate HQ, and
Speaker 1: then also squaring off with with Pelts, bring us the latest, right, Yeah,
Speaker 1: so you're right out to the bat. He indicated he
Speaker 1: was gonna do away with is sort of controversial distribution
Speaker 1: arm Disney that sort of made decisions about where all
Speaker 1: the movies and TV shows go and to rankle a
Speaker 1: lot of staff internally. He hasn't really come up with
Speaker 1: that new plan yet, but he's indicated that on the
Speaker 1: way out the door this week. Also, as you noted, UH,
Speaker 1: and it changes to the parks, you know under tape
Speaker 1: that was known for, you know, squeezing every dollar that
Speaker 1: he could at park guests and UH and now uh
Speaker 1: I was offering things like simplice photo passes this year
Speaker 1: and other things, UH to to sort of win them
Speaker 1: back a bit. UH and now yes, going to war
Speaker 1: with Nelson Pelts, one of the most formidable corporate activists
Speaker 1: have been doing this for decades, you know, taking on
Speaker 1: big companies Parker and gamble, hinds uh and uh, and
Speaker 1: Disney's warn't saying no, thanks, Nelson, we we'd rather not
Speaker 1: have you on it. So a proxy war, you know,
Speaker 1: shaping up over the next two weeks. All right, to
Speaker 1: come on in on it. It's wrong with Disney, too
Speaker 1: many things, unfortunately, Carol. So this, you know, this whole
Speaker 1: timing by Pelts seems to be very very smart. Obviously,
Speaker 1: I think Disney is in a lot of turmoil right now.
Speaker 1: We had a dismal, you know, earnings report when they
Speaker 1: reported in November. You know, we saw streaming losses kind
Speaker 1: of balloon to about one and a half billion dollars
Speaker 1: for just that quarter. And if you kind of look
Speaker 1: at Pels's slide presentation, which he calls Restore the Magic,
Speaker 1: he says that a website. Yeah, he's got a website.
Speaker 1: He's got a website. Yes, Restore the Magic is the
Speaker 1: name of that website, and he basically says that, you know,
Speaker 1: streaming losses are huge, they are going to reach fifteen
Speaker 1: billion dollars by twenty four which we kind of agree with. Um,
Speaker 1: you know, so all of those things, and then of
Speaker 1: course you had that huge management upheaval with the Ouster
Speaker 1: of shapeg the reinstatement of Bob Iger. So obviously the
Speaker 1: timing is is kind of very astute on the part
Speaker 1: part of Pells. But having said that, I mean a
Speaker 1: lot of the critiques he has leveled against Disney and
Speaker 1: the board and the management, I mean, these are all
Speaker 1: all these are all already on the radar, and Bob Iger,
Speaker 1: as Chris pointed out, is is already working on these.
Speaker 1: So you know, yes, he's given all of these, he
Speaker 1: has given this londly list of items to do, but
Speaker 1: he hasn't necessarily given us a plan. Well, I guess
Speaker 1: that brings me to my question next question for Chris,
Speaker 1: which is, you know, when we think about a succession
Speaker 1: plan here or any sort of plan, you know, Iger
Speaker 1: had fifteen years to to make his plan at Disney
Speaker 1: when he led it from five to Chris, and then
Speaker 1: he hand picked Bob Jpeck. So his next step is
Speaker 1: is figuring out not only what to do in terms
Speaker 1: of strategy, but also who's going to take the helm right.
Speaker 1: And you know they've made proactively some announcements along that route.
Speaker 1: When they rehired I, they said, you've got some years
Speaker 1: and what one of your main missions is going to
Speaker 1: be you know, groom that replacement. As part of this
Speaker 1: week's news did they announced the retirement of their current
Speaker 1: chairman of the board, replacing her with Mark Palmer, Nike's
Speaker 1: former executive and he is now heading a specific subset
Speaker 1: of the board that's going to be um passed with
Speaker 1: finding that replacement. I mean, this is certainly one of
Speaker 1: the things that you know, Iger is well well respected
Speaker 1: in the industry, but there's no one, no corporate government's effort,
Speaker 1: no analysts, who really believes that this, uh, this succession
Speaker 1: plan worked very well. And so this is definitely a
Speaker 1: weak point from him and something he didn't expect. Nelson
Speaker 1: Felts to hammer away at. You know, Chris, I'm listening
Speaker 1: to you and I think about you know, years ago,
Speaker 1: right and I did you know we did a deep
Speaker 1: dive into Disney and it was Tom Stags and I
Speaker 1: can't remember um Rasulo right, the CFO where they switched places.
Speaker 1: And these are the two guys that were said to
Speaker 1: be you know, kind of getting different perspectives of the company,
Speaker 1: and one of them was going to maybe possibly likely
Speaker 1: take over for IGOR and then it didn't happen. So
Speaker 1: you know. I mean, is Bob okay about handing over
Speaker 1: the mantel? Uh? That depends that you ask. Uh. You know,
Speaker 1: there's certainly the school and thought that that says he's
Speaker 1: not a guy you know and historically, by the way,
Speaker 1: Disney CEOs if you have had a hard time given
Speaker 1: up the job, remember Vitaliser. So uh, yeah, you know
Speaker 1: it's you know, he stayed. We knew his contract four
Speaker 1: times at least five mouth counts this one. Um, you know,
Speaker 1: he is he is one who very much wanted to
Speaker 1: stay in that role. Gita, what's your thoughts in terms
Speaker 1: of Bob Iger back at the helm, Is this exactly
Speaker 1: what the company needs? Um to kind of set it straight?
Speaker 1: And then ultimately do you think he'll be comfortable in
Speaker 1: two years time handing over the top spot. Yeah, that's
Speaker 1: that's a loaded question, Carol. So you know, um, I
Speaker 1: think he is absolutely the best person to leave the
Speaker 1: company right now. He knows what needs to be done.
Speaker 1: He's very very familiar with all of the assets, all
Speaker 1: of the I p uh you know. He he clearly
Speaker 1: understands that some of the content, especially the animated content,
Speaker 1: has been underperforming. So there is a clear task on hand. Uh,
Speaker 1: for for Bob Bikers. So I'm sure he knows exactly
Speaker 1: what he's doing. Now the question comes to succession, and
Speaker 1: this has you know, this has been botched by either
Speaker 1: I mean he's for all the successes that he's had,
Speaker 1: I mean, this is one consistent area where he has failed. Uh.
Speaker 1: And you know it's going to be interesting to see
Speaker 1: because he has I mean it really ultimately, I think
Speaker 1: comes down to creative expertise. And this is something what
Speaker 1: all the other prior candidates I think have have collectively lacked, right,
Speaker 1: whether it was a Tom Stags or whether it was
Speaker 1: a j Rossulo and even Tom jay Bick. I mean
Speaker 1: he was a Parks guy. So you know it kind
Speaker 1: of that whole creative process managing talent. I mean that
Speaker 1: that is something that only very few people can do. Um.
Speaker 1: And so it's going to be interesting to see if
Speaker 1: they can really find somebody within two years. My sister,
Speaker 1: My suspicion is, you know, this is again going to
Speaker 1: be a deja wo situation, because yes, he's invigorating think
Speaker 1: the content right now, he's you know, rejiggering the whole
Speaker 1: creative process. But I don't think two years is going
Speaker 1: to be enough for him to really uh complete what
Speaker 1: he starts. So if he's doing really well, is it
Speaker 1: possible that he sticks around? And yes, yeah, he's gotta
Speaker 1: he's gotta update that autobiography that he released a couple
Speaker 1: of years ago. I think he gita Um. In terms
Speaker 1: of names, is there any chance that Disney would go
Speaker 1: outside of the company to find someone, I definitely think
Speaker 1: that's possible. I mean, there are a few names that
Speaker 1: you know, keep coming up internally. You know, obviously Christine McCarthy,
Speaker 1: she's the CFO. She has a lot of experience. But again,
Speaker 1: if they're really looking for somebody with that creative kind
Speaker 1: of genius, I don't know if she necessarily fits the bill.
Speaker 1: Of course, you have Dana Walden who comes from Fox
Speaker 1: who probably you know, does have a lot of creative expertise.
Speaker 1: She's you know, kind of managed the TV and entertainment business.
Speaker 1: But I wouldn't be surp rise if they if they
Speaker 1: look outside as well. Uh And again here also, you know,
Speaker 1: a very interesting point by Belts about why they would
Speaker 1: have chosen you know, Bob Japeck and not Kevin Mayer.
Speaker 1: And that's something that we were all kind of scratching.
Speaker 1: Kevin Mayor's long gone at this point, he is, Yes,
Speaker 1: he's he's doing his own thing now. But um, you
Speaker 1: know that that was that was a big shock, actually
Speaker 1: a big surprise when when that whole announcement came out,
Speaker 1: just kind of given his involvement in the whole streaming initiative,
Speaker 1: just kind of given his whole expertise with content. Yeah,
Speaker 1: what about the Hey, Chris, what with the Marvel head?
Speaker 1: I mean, uh, Kevin fahey, I mean, is that a possibility? Yeah,
Speaker 1: I don't think so. You know, Kevin is, without adapt
Speaker 1: the most successful bruiser in the history of Hollywood. Uh,
Speaker 1: And so you know, he's had plenty of opportunities if
Speaker 1: he wanted to to to rise within the organization or
Speaker 1: go to another studio. I think he's very content running
Speaker 1: mar and um, you know, probably it would be arguably
Speaker 1: doesn't have the bottom experience it would take to run
Speaker 1: the Wall Basy company. Well, it's an incredible company. When
Speaker 1: we talk about, you know, world where content matters, this
Speaker 1: is a company that has so much and it's so
Speaker 1: good about kind of mixing it across the platform. So
Speaker 1: it will be interesting to see one that's reinvented itself
Speaker 1: many times over a century. Yeah, I mean absolutely, Um,
Speaker 1: so we'll keep an eye on it, I know, so
Speaker 1: will our team. Chris. Thank you, Chris, Paul Mary Entertainment
Speaker 1: edit up Bloomberg News on the phone from l a
Speaker 1: and always always our thanks to Gita ran Ganathan. She's
Speaker 1: technology media analysts with our Bloomberg Intelligence team from our
Speaker 1: BI headquarters in Princeton Road, marrow a Journal. Yeah, but
Speaker 1: you let me drive? Oh no, no, no no, no, an please,
Speaker 1: I'll do I want to drive. It's a good question.
Speaker 1: Drive is the drive to the globe on blue Bird Radio.
Speaker 1: I just got about ATMs left in the Thursday trading session,
Speaker 1: getting ready to wrap that up. Stocks. You just heard
Speaker 1: the numbers and the overall market numbers from Doug. But
Speaker 1: stocks coming off their highs of the session, So let's
Speaker 1: see what our next guest has to say about the outlook.
Speaker 1: Very pleased to have with us this afternoon, Chris. I
Speaker 1: go c I O at the asset Manager Access Investment
Speaker 1: Managers with us via zoom from London. Chris, how are
Speaker 1: you very well? Thanks thanks for having me well, thanks
Speaker 1: so much for joining us. Really appreciate it. So the
Speaker 1: CPI report here in the US has come and gone
Speaker 1: and it will really just hit expectations. My feeling is
Speaker 1: that investors were kind of pricing in something even softer. Carol, Yeah,
Speaker 1: I think so helpful. Yeah, they were hor hopeful about that.
Speaker 1: Um what do you make of it? Chris? Yeah, I
Speaker 1: mean I think that there was the expectation it could
Speaker 1: have come in lower. But I think the trend is
Speaker 1: is very encouraging. We had all the nasty surprises in
Speaker 1: the middle of last year, and the last few months
Speaker 1: the numbers have come in line with with what economists
Speaker 1: of forecasts, So that's encouraging, and it suggests that inflation
Speaker 1: is going to gradually ease as we go through three Hey, Chris,
Speaker 1: one thing I do wonder you know, bonds have definitely
Speaker 1: gotten more competitive when it comes to the equity side
Speaker 1: of things. If you look at you know, what we're
Speaker 1: seeing in terms of yields versus what you yield on
Speaker 1: the S and P five hundred, How do you think
Speaker 1: about bond stock let's go basic bond stock allocations. How
Speaker 1: do they compare? Well? I think bonds are back. I
Speaker 1: mean we've got yields now which are attractive and for
Speaker 1: many years they weren't. So I think investors who are
Speaker 1: managing or running multi asset portfolios can really see a
Speaker 1: more interesting role for bonds this year. You're getting high
Speaker 1: yield or the same amount of duration or credit risk,
Speaker 1: and at a time when the outlook freak, which is
Speaker 1: is still somewhat uncertain because we're just about to head
Speaker 1: into earning season. Most of the forecast for a modest
Speaker 1: recession in the US this year, I think bonds give
Speaker 1: that certainty of return which we haven't had for some time.
Speaker 1: Having said that, you know, we just talked with their
Speaker 1: Stephanie Flanders. The year ahead issue of Bloomberg Business Week
Speaker 1: is out, and she really you know, sets the tone
Speaker 1: in terms of talking about the global economic outlook for
Speaker 1: three and how it too could hold some surprises. Right.
Speaker 1: Whod thought we'd see a Russian invasion of Ukraine. Whoda
Speaker 1: thought going back to that would be in the midst
Speaker 1: of a global pandemic that shut down the economy. You know, Wow,
Speaker 1: a reminder that things come out of nowhere. And I
Speaker 1: do wonder how do you think about that in regards
Speaker 1: to this year. Yeah, I mean, I think these things
Speaker 1: are always unfoecastable. Aren't they. But what I would say
Speaker 1: is that today markets are cheaper than they were this
Speaker 1: time last year on the eve of the Russian invasion
Speaker 1: of Ukraine. We're going back to bonds. You've got more
Speaker 1: yield providing a cushion two returns, and equities are still
Speaker 1: you know, ten off their high. So I don't see
Speaker 1: as much downside. And I don't know what the big
Speaker 1: shot will be this year. But you know, we've had
Speaker 1: the war, we've had the invasion, we've had four hundred
Speaker 1: basis points of FED tightening. Hopefully we won't get those
Speaker 1: things again. So I'm hoping for a more boring year
Speaker 1: where you can get decent returns, and boring boring in
Speaker 1: decent returns, that certainly would be nice. I think the
Speaker 1: five hundred seven right now. Earlier on our program, our
Speaker 1: colleague on TV Remained Bostick mentioned that it was close
Speaker 1: to its two day moving average is certainly an important
Speaker 1: technical level to you looking out across the at least
Speaker 1: this cycle. Do you think we've seen the bottom in
Speaker 1: the cycle. I tend to think we have. Yeah. I think,
Speaker 1: you know, a lot of the d rating last year
Speaker 1: was because yields were going up and particularly real yields
Speaker 1: that they seem to have peaked. Now. Um, we've we've
Speaker 1: you know, we've had the uncertainty about how much they're
Speaker 1: fed will need to tighten. That seems to be clearing
Speaker 1: up a bit. We know there's going to be a
Speaker 1: growth slow down. I think that the swing fact to
Speaker 1: at the moment is the earning numbers and how they're
Speaker 1: going to look over the next several quarters. But to me,
Speaker 1: it would take some really, really bad news for us
Speaker 1: to test last year's lows. I want to go back
Speaker 1: to fixed income income because you say, Chris, that fixed
Speaker 1: income really stands to benefit most when inflation interest rates peak,
Speaker 1: and it does feel like we're going to get to it,
Speaker 1: whether it's this year or maybe at least. The thinking
Speaker 1: is that the FED is coming near an end, and
Speaker 1: maybe global central banks are as well. So what's the
Speaker 1: fixed income play? Um, is it sovereign debt? Is a
Speaker 1: corporate debt? What is it? I think the speech sweet
Speaker 1: spot is investment grade credit. And actually it's the short
Speaker 1: end of the curve. It's the short maturities because the
Speaker 1: yield curve is inverted, so you're getting higher yields at
Speaker 1: the short end. Of the market that you are in
Speaker 1: the five, ten or fifteen year sectors. So why take
Speaker 1: on that additional maturity risk when you can get nice
Speaker 1: yields today? So investment grade looks good. We're we're quite
Speaker 1: as on the fundamentals for great credit and if you're
Speaker 1: feeling really optimistic, going to high yield where you can
Speaker 1: get six seven eight percent yield without taking too much
Speaker 1: duration with risk, and I think given where we are
Speaker 1: in the cycle, that's a very attractive proposition. Any any
Speaker 1: you know companies sectors in particular, or any regions of
Speaker 1: the world when it comes to corporate well, we like
Speaker 1: we like dollar debt, we like US dollar denominated debt,
Speaker 1: and it extends to things like emerging market hard currency
Speaker 1: debt as well. We're already seeing, i think, some signs
Speaker 1: where the fundamentals are improving. And we've already had quite
Speaker 1: a bit of issuance this year so far. Saudi Arabia
Speaker 1: came with a big deal, Israel came with a big deal.
Speaker 1: You know, US rates are peaking, the dollars seems to
Speaker 1: have peaked. These are all good signs for emerging markets.
Speaker 1: What about Europe closer to home? How does the how
Speaker 1: does the year look. I mean, we spent a lot
Speaker 1: of last year talking about concerns that we could hit
Speaker 1: a recession, and Carol you mentioned it at Stephanie Flanders
Speaker 1: essentially saying that, you know, reset in Europe might be
Speaker 1: more shallow than many people thought. It's pretty interesting to
Speaker 1: hear this, although UK she wasn't so sure about it exactly. Um,
Speaker 1: do you see opportunities there, Chris, as a result of
Speaker 1: the continued strength that we're seeing. Well, you know, I
Speaker 1: think the big the big issue for Europe was was
Speaker 1: the energy situation and the turning off of the Russian
Speaker 1: supplies of gas, and they seem to have dealt with
Speaker 1: it pretty well. We're having a relatively mild winter so far,
Speaker 1: so but how about those energy prices that you're paying
Speaker 1: for for what you are paying for heat. They're coming
Speaker 1: down and eventually they'll come down for the consumer as well.
Speaker 1: China reopening is actually pretty good for Europe as well,
Speaker 1: because a lot of the industrial goods will get a
Speaker 1: boost from when China starts to demand more imports again.
Speaker 1: And I see more opportunity on the equity side really there,
Speaker 1: on the fixed income side in Europe because equity markets
Speaker 1: here got smashed last year. They were training on you know,
Speaker 1: below ten times this year's expected earnings and if things
Speaker 1: aren't going to play out quite as badly as they
Speaker 1: as as thought a few months ago, and there's certainly
Speaker 1: some significant upside for for equities. It's more of a
Speaker 1: value cyclical play. But in contrast to the US market
Speaker 1: which remains dominated by take, I think Europe has got
Speaker 1: some upside on the equities side. Well, Chris, really appreciate
Speaker 1: getting some time with you today. Chris i Go his
Speaker 1: chief investment officer at Accent Investment Managers, joining us via
Speaker 1: zoom from London on this Thursday. Thanks for listening to
Speaker 1: Bloomberg Business Week. Download the podcast on iTunes, SoundCloud, or
Speaker 1: Bloomberg dot com. You can also listen to our radio
Speaker 1: show at two pm Eastern on Bloomberg Radio or stream
Speaker 1: us live on YouTube and Bloomberg dot com.