1 00:00:05,120 --> 00:00:09,200 Speaker 1: Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keane. Along 2 00:00:09,240 --> 00:00:13,080 Speaker 1: with Jonathan Ferrell and Lisa A. Brawnowitz Jaily, we bring 3 00:00:13,119 --> 00:00:17,159 Speaker 1: you insight from the best and economics, finance, investment, and 4 00:00:17,280 --> 00:00:23,280 Speaker 1: international relations. Find Bloomberg Surveillance on Apple Podcast, Suncloud, Bloomberg 5 00:00:23,360 --> 00:00:28,800 Speaker 1: dot Com, and of course on the Bloomberg terminal. This 6 00:00:28,960 --> 00:00:32,120 Speaker 1: is a joy and Harkins back in his twenty years 7 00:00:32,120 --> 00:00:36,479 Speaker 1: at Columbia to lead Bollinger and myself in conversation at Davos. 8 00:00:36,560 --> 00:00:41,000 Speaker 1: I'm gonna say two thousand four, two thousand five in 9 00:00:41,080 --> 00:00:45,080 Speaker 1: his vision of a Columbia university that would support Harlem 10 00:00:45,159 --> 00:00:49,480 Speaker 1: and support New York City with Manhattanville, that is now. 11 00:00:49,960 --> 00:00:52,520 Speaker 1: And they have moved forward from Bollinger to the great 12 00:00:52,600 --> 00:00:57,520 Speaker 1: architect Renzo Piano to Professor Cohen joining us how ev 13 00:00:57,760 --> 00:01:00,920 Speaker 1: Joseph Cohen of course always with god Been Sacks No 14 00:01:01,200 --> 00:01:06,240 Speaker 1: former Golden Sex senior investment strategists and professor at Geffen 15 00:01:06,400 --> 00:01:09,880 Speaker 1: five Columbus Business School. I mean, you're going to start 16 00:01:09,959 --> 00:01:15,480 Speaker 1: your Future of Global Economy course remote because of COVID, 17 00:01:15,600 --> 00:01:19,120 Speaker 1: because of a macron is Well, when you get to 18 00:01:19,280 --> 00:01:23,319 Speaker 1: Geffen five nine, how will you lecture the business students. 19 00:01:23,360 --> 00:01:27,559 Speaker 1: What will you bring to them different? Well, Tom, first 20 00:01:27,600 --> 00:01:29,960 Speaker 1: of all, thank you for inviting me to be here 21 00:01:30,000 --> 00:01:32,880 Speaker 1: this morning. This, in fact is the first time I've 22 00:01:32,920 --> 00:01:37,319 Speaker 1: been speaking since my shift over from Goldman Sachs. UM. 23 00:01:37,360 --> 00:01:41,479 Speaker 1: I'm ecstatic about this change, UM, moving to the Columbia 24 00:01:41,520 --> 00:01:45,720 Speaker 1: Business School and the Global Economics and Financial Markets course 25 00:01:45,720 --> 00:01:48,320 Speaker 1: that I'll be teaching is actually, of course I've been 26 00:01:48,320 --> 00:01:51,920 Speaker 1: teaching for the past eight or nine years. UM. I've 27 00:01:51,960 --> 00:01:56,480 Speaker 1: been a longstanding adjunctum at Columbia UM, and I consider 28 00:01:56,520 --> 00:01:59,800 Speaker 1: it to be a great intellectual home. Of course, it's 29 00:02:00,000 --> 00:02:03,400 Speaker 1: health is a combination of theory and practice. I have 30 00:02:03,600 --> 00:02:06,880 Speaker 1: the opportunity to teach with one of the wonderful tenured 31 00:02:06,960 --> 00:02:10,400 Speaker 1: professors at Columbia, gentleman by the name of Pierre ja Ed, 32 00:02:10,720 --> 00:02:13,320 Speaker 1: who will be covering a lot of the theoretical macro 33 00:02:13,840 --> 00:02:16,440 Speaker 1: and I'll be talking about, well, what's really happened in 34 00:02:16,440 --> 00:02:20,120 Speaker 1: the markets, not just over the last few days, but 35 00:02:20,200 --> 00:02:22,800 Speaker 1: if you will, over the last several decades, trying to 36 00:02:22,840 --> 00:02:26,080 Speaker 1: put this all in perspective for our students. The perspective 37 00:02:26,080 --> 00:02:29,399 Speaker 1: needed away from your prodigious math abilities, is the new 38 00:02:29,480 --> 00:02:33,880 Speaker 1: capitalism Columbia Business School has supporters with names that we 39 00:02:34,000 --> 00:02:38,360 Speaker 1: know on surveillance. Cravis Cooperman, of course, the great gentleman 40 00:02:38,440 --> 00:02:42,240 Speaker 1: from entertainment, David Geffen. How do the new capitalists and 41 00:02:42,280 --> 00:02:45,640 Speaker 1: the budding NBA students, how do they deal with a 42 00:02:45,720 --> 00:02:51,760 Speaker 1: new more responsible capitalism. That's a terrific question, Tom. And 43 00:02:51,840 --> 00:02:54,840 Speaker 1: let's keep in mind that at Columbia is also this 44 00:02:54,960 --> 00:02:59,760 Speaker 1: great legacy of intellectual capital Uh. Some of the great 45 00:02:59,800 --> 00:03:03,160 Speaker 1: things in terms of capital markets in the nineteen thirties 46 00:03:03,200 --> 00:03:08,680 Speaker 1: and forties also had relationships at Columbia strong economics department, 47 00:03:08,760 --> 00:03:13,799 Speaker 1: strong finance department, people like Ben Graham for example. UM. 48 00:03:13,840 --> 00:03:16,120 Speaker 1: And so what I see in the new students is 49 00:03:16,160 --> 00:03:19,880 Speaker 1: really quite interesting. At Columbia, about half of the students 50 00:03:19,880 --> 00:03:23,799 Speaker 1: in my course are in fact non Americans, and they 51 00:03:23,840 --> 00:03:28,160 Speaker 1: bring an incredible global perspective to what we're seeing. You. 52 00:03:28,560 --> 00:03:31,160 Speaker 1: Very often, when we look at structural change in the 53 00:03:31,280 --> 00:03:34,120 Speaker 1: United States, we say, nobody else has ever dealt with 54 00:03:34,200 --> 00:03:39,440 Speaker 1: us before. Well, we are actually incorporating the experiences of 55 00:03:39,480 --> 00:03:43,360 Speaker 1: our students as well. We do find that this generation 56 00:03:43,360 --> 00:03:48,000 Speaker 1: of students is very much interested in a few things. Uh. 57 00:03:48,120 --> 00:03:52,400 Speaker 1: Number One, they'd like to know how companies run obviously, 58 00:03:52,880 --> 00:03:56,240 Speaker 1: and our course we also talk about how government policy 59 00:03:56,400 --> 00:04:00,240 Speaker 1: is made, and we give the students opportunities to eight 60 00:04:00,600 --> 00:04:03,920 Speaker 1: what should those policies look like. And among the topics 61 00:04:03,960 --> 00:04:06,520 Speaker 1: we addressed, of course of things like E. S. G. 62 00:04:07,120 --> 00:04:11,360 Speaker 1: But we also look at things like regulatory changes, things 63 00:04:11,400 --> 00:04:14,360 Speaker 1: that might need to be adjusted as the structure of 64 00:04:14,360 --> 00:04:17,960 Speaker 1: an economy changes. And of course I always love to 65 00:04:18,000 --> 00:04:22,120 Speaker 1: talk about the fundamentals the data in the economy, but 66 00:04:22,240 --> 00:04:25,240 Speaker 1: also the valuation of the markets. And when I say 67 00:04:25,279 --> 00:04:30,239 Speaker 1: the markets, it's not Lisa Brandma. Do you know somebody 68 00:04:30,240 --> 00:04:32,560 Speaker 1: in row seven is gonna stand up and say, hey, Abby, 69 00:04:32,600 --> 00:04:35,200 Speaker 1: what do you think of the market? That's where? And 70 00:04:35,240 --> 00:04:37,360 Speaker 1: so I'll do it. I'll stand up in in row 71 00:04:37,400 --> 00:04:39,880 Speaker 1: thirty six and say, we just got this PPI data 72 00:04:39,920 --> 00:04:42,560 Speaker 1: after yesterday's CPI data, we're now pricing in about four 73 00:04:42,640 --> 00:04:46,520 Speaker 1: rate hikes. Were in a new regime for inflation. What's 74 00:04:46,560 --> 00:04:49,400 Speaker 1: the market call at a time when most strategists are 75 00:04:49,440 --> 00:04:52,880 Speaker 1: bullets on equities. Yeah, I I think in fact, the 76 00:04:52,920 --> 00:04:56,680 Speaker 1: regime change, Lisa, occurred a few months ago when we 77 00:04:56,720 --> 00:05:00,839 Speaker 1: began to see data suggesting that inflation was rising, that 78 00:05:01,040 --> 00:05:05,120 Speaker 1: interest rates would be moving up and underneath the surface 79 00:05:05,200 --> 00:05:08,280 Speaker 1: of the market indusicries. We have seen a great deal 80 00:05:08,360 --> 00:05:12,320 Speaker 1: of action, obviously the rise of volatility, but we're also 81 00:05:12,440 --> 00:05:15,640 Speaker 1: seeing that investors are starting to move away from the 82 00:05:15,640 --> 00:05:18,440 Speaker 1: big mo uh. And that big mo for many years, 83 00:05:18,440 --> 00:05:21,920 Speaker 1: of course, was fixed income by bonds, regardless of the 84 00:05:21,920 --> 00:05:25,560 Speaker 1: interest rates. We see that investors becoming much more selective 85 00:05:25,600 --> 00:05:28,159 Speaker 1: and fixed income, and of course we see that in 86 00:05:28,320 --> 00:05:31,920 Speaker 1: equities as well. The thing that is always so important 87 00:05:32,000 --> 00:05:36,840 Speaker 1: is what's already baked in uh two expectations. UH. My 88 00:05:36,960 --> 00:05:41,279 Speaker 1: feeling is that we have a few surprises ahead in 89 00:05:41,320 --> 00:05:44,719 Speaker 1: the equity market, some good, some not so good. But 90 00:05:44,839 --> 00:05:48,000 Speaker 1: the key for me is always the valuation support. And 91 00:05:48,040 --> 00:05:52,400 Speaker 1: that valuation support is not particularly good in some segments 92 00:05:52,440 --> 00:05:55,360 Speaker 1: of the market um, and some it looks pretty good. 93 00:05:55,520 --> 00:05:59,120 Speaker 1: Um uh. There are some growthy areas that are not 94 00:05:59,240 --> 00:06:03,240 Speaker 1: yet priced excessively. But the overall market I think will 95 00:06:03,279 --> 00:06:07,520 Speaker 1: be volatile because the only valuation metrics that still look 96 00:06:07,560 --> 00:06:10,720 Speaker 1: appealing are the ones that are linked to low inflation, 97 00:06:10,839 --> 00:06:14,240 Speaker 1: low interest rates. As those continue to move up somewhat 98 00:06:14,560 --> 00:06:18,640 Speaker 1: in two UH, the equity market comes under some pressure. 99 00:06:18,920 --> 00:06:24,720 Speaker 1: I think pe ratios for the overall market compress somewhat. Um, 100 00:06:24,720 --> 00:06:28,520 Speaker 1: I think there's some offset in terms of continued improvements 101 00:06:28,560 --> 00:06:31,640 Speaker 1: in earnings growth, because I certainly don't see a recession. 102 00:06:31,880 --> 00:06:34,159 Speaker 1: So I think the real action in the market is 103 00:06:34,200 --> 00:06:36,560 Speaker 1: going to be under the surface, not so much in 104 00:06:36,600 --> 00:06:38,919 Speaker 1: the indsease. And based on that, this idea of the 105 00:06:38,960 --> 00:06:42,000 Speaker 1: action under the surface, how much of that is pricing 106 00:06:42,040 --> 00:06:46,240 Speaker 1: in a perfect transition to a tightening cycle. This idea 107 00:06:46,320 --> 00:06:48,760 Speaker 1: of an excit and threading a needle that by all 108 00:06:48,760 --> 00:06:50,320 Speaker 1: accounts is going to be tough for the FED to 109 00:06:50,320 --> 00:06:54,880 Speaker 1: do well. You raise two very interesting points. Number one, 110 00:06:55,279 --> 00:06:58,320 Speaker 1: the needle that the FED has to thread, and they'll 111 00:06:58,360 --> 00:07:01,800 Speaker 1: be doing it through a combination I believe, of increases 112 00:07:01,839 --> 00:07:06,120 Speaker 1: in short rates but also adjusting that balance sheet. Could 113 00:07:06,160 --> 00:07:10,520 Speaker 1: there be another temper tantrum maybe, But I think the 114 00:07:10,520 --> 00:07:13,600 Speaker 1: Fed is actually doing a great job by signaling these 115 00:07:13,600 --> 00:07:16,000 Speaker 1: things ahead of time. You know, when I started as 116 00:07:16,040 --> 00:07:19,560 Speaker 1: a junior economist the Federal Reserve Board in Washington, the 117 00:07:19,680 --> 00:07:22,200 Speaker 1: rule of thumb then was you didn't tell the markets 118 00:07:22,360 --> 00:07:26,480 Speaker 1: anything about what you plan to do as policymakers, and 119 00:07:26,920 --> 00:07:29,720 Speaker 1: two to three months later you'd start to tell people 120 00:07:29,920 --> 00:07:32,880 Speaker 1: what in fact had already happened. That's not the way 121 00:07:32,880 --> 00:07:36,960 Speaker 1: it works now. I think the signaling that gets done 122 00:07:37,840 --> 00:07:41,160 Speaker 1: by the FED is actually very very helpful in that regard. 123 00:07:41,440 --> 00:07:44,680 Speaker 1: So that's one needle that has to be threaded. I 124 00:07:44,720 --> 00:07:47,560 Speaker 1: think the FED has begun to do a very good job. 125 00:07:47,960 --> 00:07:50,560 Speaker 1: The other needle that has to be threaded is how 126 00:07:50,640 --> 00:07:56,000 Speaker 1: to position portfolios. And I think that institutional investors UM 127 00:07:56,280 --> 00:07:59,200 Speaker 1: have been talking about this, they haven't been doing it. 128 00:07:59,600 --> 00:08:03,960 Speaker 1: I worry much more so about individual investors, many of 129 00:08:03,960 --> 00:08:07,400 Speaker 1: whom haven't yet figured out the damage that could occur 130 00:08:07,920 --> 00:08:11,920 Speaker 1: to their personal portfolios as interest rates begin to rise 131 00:08:12,480 --> 00:08:15,040 Speaker 1: UM and and that to me is concerning. And so 132 00:08:15,080 --> 00:08:17,800 Speaker 1: when we think about, you know, shocks to the system 133 00:08:17,840 --> 00:08:21,040 Speaker 1: when the valuation supports not so good, we can't assume 134 00:08:21,240 --> 00:08:24,680 Speaker 1: a smooth transition. There are some risks out there that 135 00:08:24,720 --> 00:08:28,520 Speaker 1: could knock us off balance. People talk for always about 136 00:08:29,360 --> 00:08:32,320 Speaker 1: the pandemic, which is not over. We need to worry 137 00:08:32,320 --> 00:08:36,559 Speaker 1: about what's happening in other countries were vaccine distribution has 138 00:08:36,559 --> 00:08:39,400 Speaker 1: been quite limited. We also need to worry about a 139 00:08:39,480 --> 00:08:42,800 Speaker 1: disruption and fixed income markets and what that could do. 140 00:08:43,280 --> 00:08:45,160 Speaker 1: UM and I know that there are some people out 141 00:08:45,160 --> 00:08:48,880 Speaker 1: there who are concerned about what happens when people recognize 142 00:08:49,040 --> 00:08:52,320 Speaker 1: that there's now been a big difference between cap market 143 00:08:52,400 --> 00:08:57,439 Speaker 1: performance and equally, and then when they ask you for 144 00:08:57,480 --> 00:09:00,240 Speaker 1: your market calle, just tell them yield up, price down 145 00:09:00,240 --> 00:09:02,360 Speaker 1: and leave it at that. Professor Cohen, thank you so 146 00:09:02,440 --> 00:09:11,000 Speaker 1: much for joining us today with Columbia Business School. Let's 147 00:09:11,000 --> 00:09:13,040 Speaker 1: get right to it. Lisa Shallott joins us the chief 148 00:09:13,080 --> 00:09:16,600 Speaker 1: investment officer Morgan Stanley Wealth Management. Lisa, I want to 149 00:09:16,600 --> 00:09:19,480 Speaker 1: cut to the chase. How much cash do you need 150 00:09:19,600 --> 00:09:23,120 Speaker 1: right now? As cash a negative thing, or as cash 151 00:09:23,160 --> 00:09:28,360 Speaker 1: and a portfolio a positive construct. So we're looking at 152 00:09:28,400 --> 00:09:31,719 Speaker 1: cash as an opportunistic asset right here. Um, if you 153 00:09:31,920 --> 00:09:35,600 Speaker 1: look underneath the surface of these indices, you know you've 154 00:09:35,600 --> 00:09:40,760 Speaker 1: got of the stocks in the market have actually corrected 155 00:09:40,760 --> 00:09:43,120 Speaker 1: from fifty two week highs, and many have corrected as 156 00:09:43,200 --> 00:09:46,920 Speaker 1: much as ten or so. UM. We think that this 157 00:09:47,000 --> 00:09:50,480 Speaker 1: is an opportunistic stock picker's market. But you have to 158 00:09:50,520 --> 00:09:54,840 Speaker 1: do your homework, and that homework really requires understanding UH. 159 00:09:54,960 --> 00:09:58,040 Speaker 1: If if you've got enough defensiveness in your names, if 160 00:09:58,080 --> 00:10:00,920 Speaker 1: you've got quality, if you've got the potential to beat 161 00:10:01,440 --> 00:10:04,520 Speaker 1: UH profit forecasts, if you've got the potential to raise 162 00:10:04,640 --> 00:10:08,800 Speaker 1: dividends and do buybacks, because those are the types of things, uh, 163 00:10:08,840 --> 00:10:10,960 Speaker 1: that are going to allow your your stock to be 164 00:10:11,040 --> 00:10:15,440 Speaker 1: resilient in against a tape where the FED is raising 165 00:10:16,080 --> 00:10:18,640 Speaker 1: rates and the cost of capital is drifting higher, which 166 00:10:18,640 --> 00:10:21,559 Speaker 1: means price earnings ratios are drifting lower at least. So 167 00:10:21,600 --> 00:10:24,040 Speaker 1: this cycle has moved at a rapid pace. Is it 168 00:10:24,160 --> 00:10:27,000 Speaker 1: too early still to say this is light cycle? It's 169 00:10:27,000 --> 00:10:31,600 Speaker 1: a light psychodynamic now, UM, I think it's a little 170 00:10:31,880 --> 00:10:34,000 Speaker 1: I think it's a little early to say that. You know, 171 00:10:34,080 --> 00:10:37,520 Speaker 1: we've we've been um, you know, pretty consistent saying that 172 00:10:37,600 --> 00:10:41,440 Speaker 1: this is a mid cycle transition. Um. Certainly the labor 173 00:10:41,520 --> 00:10:46,520 Speaker 1: market with unemployment below four percent is starting to feel 174 00:10:46,679 --> 00:10:49,280 Speaker 1: late cycle to us. We are in the camp that 175 00:10:49,400 --> 00:10:52,679 Speaker 1: says structural changes have happened in the labor market that 176 00:10:52,720 --> 00:10:56,640 Speaker 1: are going to prevent participation rates from you know, rapidly 177 00:10:56,880 --> 00:11:00,480 Speaker 1: mean reverting to to where we were pre pandemic. UM. 178 00:11:00,520 --> 00:11:02,880 Speaker 1: But we do think that that there's a big trunk 179 00:11:02,920 --> 00:11:06,120 Speaker 1: of the economy that has yet to recover, and that's 180 00:11:06,160 --> 00:11:09,920 Speaker 1: really the consumer services part of the economy. So we're 181 00:11:09,960 --> 00:11:12,840 Speaker 1: still in that you know, it's a late mid cycle 182 00:11:12,920 --> 00:11:16,320 Speaker 1: as opposed to explicitly late cycle, well late mid cycle, 183 00:11:16,440 --> 00:11:19,040 Speaker 1: at a time when the market is currently pricing in 184 00:11:19,360 --> 00:11:23,840 Speaker 1: about four rate hikes in two I keep asking investors 185 00:11:24,080 --> 00:11:27,440 Speaker 1: have equities fully priced this in yet? And frankly, the 186 00:11:27,440 --> 00:11:30,000 Speaker 1: answer has come back, Yeah, everybody knows it's priced in. 187 00:11:30,120 --> 00:11:34,679 Speaker 1: Do you agree? I don't. I I think that the 188 00:11:35,240 --> 00:11:41,839 Speaker 1: stock market has been extraordinarily skeptical of the FED. I 189 00:11:41,880 --> 00:11:44,880 Speaker 1: think that that, you know, when you have had as 190 00:11:45,000 --> 00:11:48,600 Speaker 1: powerful a FED put as we have had in this 191 00:11:48,679 --> 00:11:52,920 Speaker 1: market quite frankly for the past thirteen years, going all 192 00:11:52,960 --> 00:11:55,240 Speaker 1: the way back to the Great Financial Crisis and in 193 00:11:55,320 --> 00:11:58,400 Speaker 1: March of two thousand and nine, UM, it's really hard 194 00:11:58,440 --> 00:12:02,480 Speaker 1: to convince people that that the regime is shifting. Uh. 195 00:12:02,720 --> 00:12:06,400 Speaker 1: So we do think that that certainly the indices, some 196 00:12:06,480 --> 00:12:09,840 Speaker 1: of the more richly valued names, uh that we all know, 197 00:12:10,000 --> 00:12:13,720 Speaker 1: those those Taflon megacap tech names, uh, you know, still 198 00:12:13,760 --> 00:12:17,520 Speaker 1: need to reprice UM a decent amount, maybe maybe ten 199 00:12:17,600 --> 00:12:22,120 Speaker 1: to fifteen percent to reflect What we do think is is, uh, 200 00:12:22,200 --> 00:12:24,839 Speaker 1: you know, the distance forward on rates. So you think 201 00:12:24,880 --> 00:12:27,800 Speaker 1: that big tech still needs to correct ten to fifteen 202 00:12:27,880 --> 00:12:31,319 Speaker 1: percent from here. Just to make that very clear, I 203 00:12:31,480 --> 00:12:33,560 Speaker 1: have to think what's the trigger Given the fact that 204 00:12:33,559 --> 00:12:35,600 Speaker 1: we just got c p I coming in at the 205 00:12:35,640 --> 00:12:38,040 Speaker 1: hottest level in thirty nine years, we're about to get 206 00:12:38,160 --> 00:12:41,880 Speaker 1: a similar read from p p I. Yeah. Look, I 207 00:12:41,920 --> 00:12:45,800 Speaker 1: think it's a question of actually seeing the Fed follow through. Um. 208 00:12:45,840 --> 00:12:49,080 Speaker 1: You know, certainly we now planted the seeds that not 209 00:12:49,240 --> 00:12:52,320 Speaker 1: only are rate hikes on the table, and rate hikes 210 00:12:52,360 --> 00:12:55,160 Speaker 1: on the table as early as March, but you know 211 00:12:55,240 --> 00:12:58,880 Speaker 1: the Fed minutes really planted the seeds that perhaps we're 212 00:12:58,880 --> 00:13:02,360 Speaker 1: gonna see balance she run off. Now, balance sheet runoff 213 00:13:03,240 --> 00:13:09,559 Speaker 1: really contributes to actual tightening and really ultimately translates into 214 00:13:09,600 --> 00:13:14,000 Speaker 1: the equivalent of additional rate hikes. So I think once 215 00:13:14,040 --> 00:13:17,360 Speaker 1: there's more clarity on that, that will be quote unquote 216 00:13:17,400 --> 00:13:22,360 Speaker 1: the last down leg in the market among those names 217 00:13:22,400 --> 00:13:25,800 Speaker 1: that again here tofore have have you know, proven um 218 00:13:25,880 --> 00:13:30,120 Speaker 1: kind of resilient teflon like Lisa three to five years out. 219 00:13:30,240 --> 00:13:34,360 Speaker 1: How do you rationalize double digit revenue growth at the 220 00:13:34,840 --> 00:13:38,760 Speaker 1: at the technology profit makers, not the ones where there's 221 00:13:38,800 --> 00:13:41,760 Speaker 1: a story, but the ones that are minting free cash 222 00:13:41,880 --> 00:13:44,880 Speaker 1: law every day? How do you approach those with a 223 00:13:44,920 --> 00:13:49,520 Speaker 1: longer term time arizon. Well, Tom, I love your question 224 00:13:49,640 --> 00:13:52,920 Speaker 1: because this is the conversation we're having with clients every 225 00:13:52,960 --> 00:13:56,400 Speaker 1: single day. What we're trying to get folks to understand 226 00:13:56,480 --> 00:13:59,640 Speaker 1: is it's not a question of whether these are great companies. 227 00:14:00,040 --> 00:14:02,800 Speaker 1: It's a question of whether they're great stocks and what's 228 00:14:02,840 --> 00:14:07,240 Speaker 1: priced in and how realistic is it that some of 229 00:14:07,280 --> 00:14:10,200 Speaker 1: the growth rates that we've seen, much of which have 230 00:14:10,320 --> 00:14:15,640 Speaker 1: included a pull forward, a pull forward of demand because uh, 231 00:14:15,840 --> 00:14:19,320 Speaker 1: many of these themes were linked to work from home 232 00:14:19,600 --> 00:14:23,400 Speaker 1: or were linked to some of the the unique dimensions 233 00:14:23,440 --> 00:14:26,840 Speaker 1: of this pandemic. Um, can you really make the case 234 00:14:27,400 --> 00:14:30,760 Speaker 1: that those double digit type growth rates are going to sustain? 235 00:14:30,920 --> 00:14:34,440 Speaker 1: And history is just not kind on this point. Uh. 236 00:14:34,480 --> 00:14:38,560 Speaker 1: You know, innovation is terrific, but so is disruption. Uh. 237 00:14:38,560 --> 00:14:42,880 Speaker 1: And it's very rare for companies decade after decade to 238 00:14:42,920 --> 00:14:46,920 Speaker 1: be able to sustain these levels of growth without quite frankly, 239 00:14:47,000 --> 00:14:50,960 Speaker 1: being uh disrupted by competition. And think, yeah, this is 240 00:14:51,000 --> 00:14:52,840 Speaker 1: really important. I wish we had an hour for this, 241 00:14:52,880 --> 00:14:55,160 Speaker 1: but we've got such a great hour, Lisa for you 242 00:14:55,240 --> 00:14:58,360 Speaker 1: to start. Can they go play Christiansen and bring the 243 00:14:58,440 --> 00:15:04,800 Speaker 1: disruption inside? Um? Looks certainly they can, uh, and and 244 00:15:04,840 --> 00:15:08,440 Speaker 1: perhaps they may transform themselves. Obviously a lot of these 245 00:15:08,520 --> 00:15:11,640 Speaker 1: high flyers are are now you know, they've gone beyond 246 00:15:11,760 --> 00:15:15,000 Speaker 1: betting on on you know, social media, they bet on 247 00:15:15,160 --> 00:15:18,640 Speaker 1: the cloud UH and cloud services and and now they're 248 00:15:18,640 --> 00:15:21,200 Speaker 1: betting on metaverse and and you know, some of the 249 00:15:21,600 --> 00:15:25,520 Speaker 1: virtual UH services. Look, perhaps some of these companies will 250 00:15:25,560 --> 00:15:29,440 Speaker 1: make that transition to UH you know, leadership yet again 251 00:15:29,480 --> 00:15:33,480 Speaker 1: in these emerging markets. But we continue to believe that 252 00:15:33,760 --> 00:15:36,840 Speaker 1: the next set of market leaders are going to be 253 00:15:36,920 --> 00:15:40,560 Speaker 1: a different set of six or seven companies if we look, 254 00:15:40,720 --> 00:15:43,200 Speaker 1: you know, three to five years from now. Lisa Shount 255 00:15:43,360 --> 00:15:46,240 Speaker 1: of Morgan Stanley Wealth Management, Lisa, wonderful to catch up 256 00:15:46,280 --> 00:15:48,320 Speaker 1: with you. You know that we always enjoy it. Thank you. 257 00:15:54,040 --> 00:15:56,120 Speaker 1: Joining us now is Tony for sense markets trying to 258 00:15:56,120 --> 00:15:59,040 Speaker 1: just and pull folio manager and Pimco. Tonny, great to 259 00:15:59,040 --> 00:16:01,400 Speaker 1: have you bank with, especially stop right here. So we've 260 00:16:01,400 --> 00:16:03,280 Speaker 1: got the strongest print we've seen going all the way 261 00:16:03,280 --> 00:16:05,840 Speaker 1: back too. We've talked a lot about it in the 262 00:16:05,920 --> 00:16:08,480 Speaker 1: last twenty four rounds. The question lasked Tom just moments ago, 263 00:16:08,560 --> 00:16:10,600 Speaker 1: I'll ask you to view how hard would it be 264 00:16:10,680 --> 00:16:13,120 Speaker 1: for the FED to deliver more than what this market 265 00:16:13,160 --> 00:16:17,640 Speaker 1: is already looking for in twenty two Quite difficult, but 266 00:16:17,720 --> 00:16:20,440 Speaker 1: you could see the power. The power of communications. One 267 00:16:20,480 --> 00:16:22,560 Speaker 1: of the chief tools the FED has. It can use 268 00:16:22,640 --> 00:16:25,360 Speaker 1: words and then perhaps use action later, so it doesn't 269 00:16:25,360 --> 00:16:29,120 Speaker 1: have to deliver that action this year necessarily indicated may 270 00:16:29,160 --> 00:16:31,200 Speaker 1: have to do more. So we're in the future. And 271 00:16:31,480 --> 00:16:34,800 Speaker 1: of course the quantitative tightening, which we see not occurring 272 00:16:34,880 --> 00:16:38,200 Speaker 1: until September who knows, could be pulled forward as one 273 00:16:38,240 --> 00:16:41,600 Speaker 1: other tool and perhaps use that in place of of 274 00:16:41,640 --> 00:16:43,960 Speaker 1: a hike. We're looking for three to four heights this year, 275 00:16:44,040 --> 00:16:46,600 Speaker 1: rich Jonathan. One of the key things stories for the 276 00:16:46,640 --> 00:16:49,120 Speaker 1: bond market, for the stock market, for the credit markets, 277 00:16:49,280 --> 00:16:52,720 Speaker 1: markets more broadly, is the market price for enough in 278 00:16:52,800 --> 00:16:56,000 Speaker 1: terms of the terminal rate the markets thing the FED 279 00:16:56,000 --> 00:16:58,640 Speaker 1: will have will stop somewhere around one or three quarters 280 00:16:58,680 --> 00:17:01,280 Speaker 1: to the FED things mutual is two and a half. 281 00:17:01,880 --> 00:17:04,640 Speaker 1: So there's a battle out there in the future. Potentially, 282 00:17:05,160 --> 00:17:07,160 Speaker 1: if the inflation rate stays high and the JAVA strate 283 00:17:07,200 --> 00:17:10,480 Speaker 1: keeps falling, we reach late cycle dynamics with the FED 284 00:17:10,600 --> 00:17:12,600 Speaker 1: has to tell markets we need to do more, and 285 00:17:12,600 --> 00:17:15,400 Speaker 1: then that's when is more trouble. Let's go to page 286 00:17:16,040 --> 00:17:18,520 Speaker 1: two of your claimed book. How far out as a 287 00:17:18,680 --> 00:17:21,560 Speaker 1: terminal rate given a natural disaster. You can't go out 288 00:17:21,640 --> 00:17:23,840 Speaker 1: seven years now, you can't go out ten years as 289 00:17:23,880 --> 00:17:28,360 Speaker 1: a terminal rate. Fourth of July. Well, as you said 290 00:17:28,400 --> 00:17:30,960 Speaker 1: Tom earlier, you've all been talking about the amount of 291 00:17:31,040 --> 00:17:33,480 Speaker 1: hikes built into this year. You see, the comfort level 292 00:17:33,640 --> 00:17:37,040 Speaker 1: is pretty good right now. With the four hikes. The 293 00:17:37,200 --> 00:17:40,399 Speaker 1: stock market, the bond market didn't react to Powace Hawfishness 294 00:17:40,680 --> 00:17:45,240 Speaker 1: didn't react to the new highs and the CPI. The 295 00:17:45,280 --> 00:17:49,000 Speaker 1: markets also priced for three hikes three but then nothing, 296 00:17:49,480 --> 00:17:54,240 Speaker 1: uh pretty much? Is that? Nothing? Too little? That's the 297 00:17:54,240 --> 00:17:58,399 Speaker 1: big the money, the money question, with great respect to 298 00:17:58,440 --> 00:18:02,760 Speaker 1: the gazillion dollars at him go manages. Are you managing 299 00:18:02,840 --> 00:18:06,879 Speaker 1: the short term? Tony krissenzis space for the end of 300 00:18:06,920 --> 00:18:09,920 Speaker 1: the world. You're all in cash, your wicked short duration. 301 00:18:10,160 --> 00:18:12,960 Speaker 1: Let's see if they talk, folks, or are you guys 302 00:18:13,000 --> 00:18:15,639 Speaker 1: saying no, the gloom is wrong and we're going to 303 00:18:15,720 --> 00:18:19,640 Speaker 1: extenderation to find a coupon in some total return. Which 304 00:18:19,720 --> 00:18:24,040 Speaker 1: is it? It's more of the former, but there's a 305 00:18:24,080 --> 00:18:25,639 Speaker 1: little bit of the ladder, a lot of it's the 306 00:18:25,680 --> 00:18:29,399 Speaker 1: portfolio context, and investors should always have the portfolio in mind. 307 00:18:29,480 --> 00:18:32,439 Speaker 1: The credit beta, the equity beta, the correlation to the 308 00:18:32,480 --> 00:18:36,600 Speaker 1: other assets in the portfolio when buying bonds, think about 309 00:18:36,640 --> 00:18:40,080 Speaker 1: that idea you just brought up tom uh In In 310 00:18:40,119 --> 00:18:43,439 Speaker 1: a sense you said, are you considering market timing? Uh 311 00:18:44,240 --> 00:18:47,400 Speaker 1: in a portfolio that's balanced and market timing the diversification 312 00:18:47,520 --> 00:18:49,760 Speaker 1: benefits of bonds is akin to getting in a car 313 00:18:49,840 --> 00:18:52,159 Speaker 1: and saying today, I think I would be safe. I 314 00:18:52,160 --> 00:18:55,120 Speaker 1: don't need car insurance. Not to say that bonds are insurance, 315 00:18:55,160 --> 00:18:57,800 Speaker 1: but they do provide some benefit in the case that 316 00:18:57,840 --> 00:19:01,399 Speaker 1: there's a so called accident. So we are underweight duration. 317 00:19:01,400 --> 00:19:05,040 Speaker 1: We do think markets are a bit underpriced for the 318 00:19:05,040 --> 00:19:09,199 Speaker 1: potential for an increase in the terminal rate from the 319 00:19:09,240 --> 00:19:11,800 Speaker 1: one and three quarters or so that's built into what 320 00:19:11,920 --> 00:19:14,439 Speaker 1: the Fed thinks is neutral, but it probably would not 321 00:19:14,520 --> 00:19:17,760 Speaker 1: get much beyond the two's. And so when looking out 322 00:19:18,520 --> 00:19:21,520 Speaker 1: on the Bloomberg terminal at the five year five year, 323 00:19:21,560 --> 00:19:23,600 Speaker 1: as they say, where's the where is the market think 324 00:19:23,640 --> 00:19:27,680 Speaker 1: the five year treasury will be in five years? Most 325 00:19:27,800 --> 00:19:30,960 Speaker 1: yields across the yield curve the term structure as they 326 00:19:31,000 --> 00:19:35,200 Speaker 1: call it in the books, are around two pretty flat curve, 327 00:19:35,280 --> 00:19:37,720 Speaker 1: which is a way of saying the Fed will will 328 00:19:37,760 --> 00:19:41,320 Speaker 1: be successful in the long run, any kids moves policy 329 00:19:41,440 --> 00:19:43,520 Speaker 1: rate up much. So that's what the market saying. We 330 00:19:43,680 --> 00:19:46,000 Speaker 1: we disagree to an extent, but not a lot tony. 331 00:19:46,160 --> 00:19:49,520 Speaker 1: In the meantime, we're looking at actual yield, at actual 332 00:19:49,560 --> 00:19:52,359 Speaker 1: return in cash, at the actual return in the short 333 00:19:52,480 --> 00:19:54,639 Speaker 1: term space. Do you think that this is going to 334 00:19:54,760 --> 00:19:57,119 Speaker 1: be one of the best years in a while for 335 00:19:57,359 --> 00:19:59,760 Speaker 1: people who are keeping their money? Uh in it that's 336 00:19:59,760 --> 00:20:05,320 Speaker 1: sort of cash like space. Yes, because we've had already 337 00:20:05,359 --> 00:20:07,399 Speaker 1: seen an increasing looking look at the two year Treasury 338 00:20:07,440 --> 00:20:10,080 Speaker 1: note at ninety basis points, historically I would have said, well, 339 00:20:10,119 --> 00:20:12,720 Speaker 1: when the two year treasury gets to a hundred basis 340 00:20:12,800 --> 00:20:15,359 Speaker 1: points over the fideral fronds rate, that's kind of it 341 00:20:15,560 --> 00:20:18,520 Speaker 1: for yields in general. There are times though when it 342 00:20:18,600 --> 00:20:21,239 Speaker 1: can be higher than that. Even as why there's two 343 00:20:21,320 --> 00:20:23,960 Speaker 1: hundred basis points, so there maybe more in terms of 344 00:20:24,160 --> 00:20:28,000 Speaker 1: yield increases if the market thinks the FEDS actions aren't enough. 345 00:20:28,480 --> 00:20:30,920 Speaker 1: But stepping outside of what they call the to A 346 00:20:31,160 --> 00:20:34,520 Speaker 1: seven world, the regulated world, that's for the money market. 347 00:20:35,880 --> 00:20:39,920 Speaker 1: We all do. It's an exciting thing to do, isn't it, 348 00:20:40,280 --> 00:20:44,080 Speaker 1: uh Tom At the two A seven world dictates that 349 00:20:44,200 --> 00:20:47,639 Speaker 1: money market funds have a mature average maturities around sixty days. 350 00:20:48,000 --> 00:20:51,480 Speaker 1: UH should cap their cap there. And there's limitations on 351 00:20:51,560 --> 00:20:53,600 Speaker 1: the types of credits, so stepping outside that a little 352 00:20:53,600 --> 00:20:56,520 Speaker 1: bit can get an investor a little more yield, but 353 00:20:56,600 --> 00:20:59,520 Speaker 1: you've got to be judicious about it. So any wonderful 354 00:20:59,560 --> 00:21:02,040 Speaker 1: to catch you up and send out to put this 355 00:21:02,119 --> 00:21:05,480 Speaker 1: cyclical outlook this week. Brilliant rad Thank you Sonny, Tony 356 00:21:05,560 --> 00:21:14,320 Speaker 1: Christency that of Pim cog Looking at the many fronts 357 00:21:14,480 --> 00:21:16,680 Speaker 1: of Russia right now. It used to be simple math. 358 00:21:16,760 --> 00:21:19,920 Speaker 1: There was one front, there were two fronts. This morning 359 00:21:19,960 --> 00:21:22,720 Speaker 1: there are three or four fronts. For Lisa brand Woods 360 00:21:22,720 --> 00:21:25,200 Speaker 1: and myself for all of you on radio and television. 361 00:21:25,600 --> 00:21:29,000 Speaker 1: A wonderful time to speak to Ambassador Hormats. Robert Hormats 362 00:21:29,280 --> 00:21:32,480 Speaker 1: is managing director of Titaman Advisers, but far far more 363 00:21:32,880 --> 00:21:37,640 Speaker 1: with his experience from Northern Ireland deep to kazakh Stun 364 00:21:37,800 --> 00:21:40,040 Speaker 1: as well. Bob, I don't even know where to start, 365 00:21:40,520 --> 00:21:43,480 Speaker 1: but I guess I'll start with kazakh Stun because I 366 00:21:43,520 --> 00:21:48,400 Speaker 1: would suggest that is where Americans are most ignorant. Explained 367 00:21:48,560 --> 00:21:54,000 Speaker 1: from a diplomacy standpoint, the importance for America of kazakh 368 00:21:54,000 --> 00:21:59,919 Speaker 1: stun Well, kazak Stand first of all, is a large supply, 369 00:22:00,000 --> 00:22:05,919 Speaker 1: ire and transit vehicle for natural gas and for oil, 370 00:22:06,119 --> 00:22:09,680 Speaker 1: some of which goes to China, but some but also 371 00:22:09,880 --> 00:22:14,760 Speaker 1: particularly from the Caspian, goes to um Western Europe and 372 00:22:14,960 --> 00:22:22,320 Speaker 1: the West. So Second, energy energy, particularly uranium where they 373 00:22:22,359 --> 00:22:26,600 Speaker 1: are however, you measured between forty and of the world's 374 00:22:26,720 --> 00:22:32,280 Speaker 1: uranium production comes from lu Stand and now we're building 375 00:22:32,359 --> 00:22:36,040 Speaker 1: up nuclear power, they're extremely important. And third is they're 376 00:22:36,119 --> 00:22:39,879 Speaker 1: very strategically located. Other than Mongolia, which is sort of 377 00:22:39,920 --> 00:22:43,920 Speaker 1: sandwiched in between Russia and China, they're the only country 378 00:22:44,080 --> 00:22:47,159 Speaker 1: in the world that has a border with both China 379 00:22:47,480 --> 00:22:52,360 Speaker 1: and UH. So the fact that their Russian troops there 380 00:22:52,440 --> 00:22:55,920 Speaker 1: for the moment is not worrisome because they'll probably even 381 00:22:55,960 --> 00:22:59,560 Speaker 1: their stability, but they could be another, as you put it, 382 00:23:00,119 --> 00:23:04,240 Speaker 1: front on the on the Russian desire to expand its 383 00:23:04,280 --> 00:23:09,960 Speaker 1: influence Bob, what is our diplomatic inertial force forward, China's 384 00:23:10,000 --> 00:23:13,760 Speaker 1: got a view, Russia's got a view. Our view is 385 00:23:13,800 --> 00:23:16,720 Speaker 1: an isolation as toned back two hundred and fifty years, 386 00:23:17,200 --> 00:23:19,520 Speaker 1: and the idea that Kazakhstan's on the other side of 387 00:23:19,560 --> 00:23:23,879 Speaker 1: the world. What is the diplomatic omph that Republicans and 388 00:23:24,000 --> 00:23:27,879 Speaker 1: democrats can generate towards this important part of the world 389 00:23:29,160 --> 00:23:33,080 Speaker 1: very little. Um. In fact, there's a curiosity here, and 390 00:23:33,160 --> 00:23:37,040 Speaker 1: that is, we don't want the Russians, don't want the Chinese, 391 00:23:37,080 --> 00:23:42,240 Speaker 1: don't want instability in Kazakhstan for various reasons. And that is, 392 00:23:42,640 --> 00:23:45,359 Speaker 1: you know, it's on the borders of Russia and China 393 00:23:45,400 --> 00:23:48,639 Speaker 1: and and and if it weren't unstable, it would be 394 00:23:48,920 --> 00:23:54,280 Speaker 1: an opportunity for the Russians in particular to expand their influence. 395 00:23:54,320 --> 00:23:58,000 Speaker 1: But we really have have had very good relations with 396 00:23:58,119 --> 00:24:00,080 Speaker 1: the Kasacks. I've been there when I was in and 397 00:24:00,200 --> 00:24:03,600 Speaker 1: several times, and Altobia have tried to play a very 398 00:24:04,119 --> 00:24:07,520 Speaker 1: clever role between Russia, the US and China. But um, 399 00:24:07,800 --> 00:24:11,560 Speaker 1: if it becomes an unstable place and a lot of instability, 400 00:24:12,040 --> 00:24:14,600 Speaker 1: it affects the world's energy supplies and your fect the 401 00:24:14,640 --> 00:24:19,800 Speaker 1: world's uranium supplies, and it makes for more political volatility. 402 00:24:20,040 --> 00:24:24,480 Speaker 1: UM in Central Asia. That's the biggest degree in the region. 403 00:24:24,760 --> 00:24:28,240 Speaker 1: Investador hormats. As the whole world moves toward a less 404 00:24:28,280 --> 00:24:32,080 Speaker 1: fossil fuel intensive energy regime, I do wonder whether United States, 405 00:24:32,680 --> 00:24:34,879 Speaker 1: Is has enough of a footprint in some of these 406 00:24:34,960 --> 00:24:39,160 Speaker 1: countries that provide such a huge proportion of the raw 407 00:24:39,240 --> 00:24:42,520 Speaker 1: materials needed to engage in some of these plans. What's 408 00:24:42,560 --> 00:24:44,240 Speaker 1: your view on that at a time when Russia and 409 00:24:44,359 --> 00:24:47,920 Speaker 1: China are moving together to try to solidify their strategic 410 00:24:48,880 --> 00:24:52,399 Speaker 1: positioning in that region. Well, that's a great point, because 411 00:24:52,720 --> 00:24:59,720 Speaker 1: the Kazaks really have been suppliers, particularly for American oil 412 00:24:59,800 --> 00:25:03,440 Speaker 1: come Penis of a lot of oil, but not all 413 00:25:03,520 --> 00:25:05,119 Speaker 1: it comes to the US, but it does go over 414 00:25:05,240 --> 00:25:08,360 Speaker 1: some of our friends and allies infect the world price, 415 00:25:08,480 --> 00:25:11,320 Speaker 1: so it does. It does matter a lot. Uh in 416 00:25:11,520 --> 00:25:15,920 Speaker 1: terms of our our influence there. Uh from a geopolitical 417 00:25:15,960 --> 00:25:19,040 Speaker 1: point of view, it's far far less than the Russians 418 00:25:19,280 --> 00:25:23,280 Speaker 1: or the Chinese, and therefore our ability to really play 419 00:25:24,240 --> 00:25:28,160 Speaker 1: a major role as significant. But we want stability there. 420 00:25:28,240 --> 00:25:30,720 Speaker 1: The Russians and the Chinese do too. We don't want 421 00:25:30,800 --> 00:25:34,600 Speaker 1: it to be used as a base for radical johadas. 422 00:25:34,800 --> 00:25:36,919 Speaker 1: I don't think it will be because because I don't 423 00:25:36,960 --> 00:25:42,760 Speaker 1: want that. But it's it's very important quantitatively on energy 424 00:25:42,920 --> 00:25:47,719 Speaker 1: and strategically just because of worth located and what neighbors are. 425 00:25:48,720 --> 00:25:52,000 Speaker 1: Given your former experience as an ambassador, and given that 426 00:25:52,119 --> 00:25:54,400 Speaker 1: the vote for the nord stream to sanctions could come 427 00:25:54,720 --> 00:25:57,200 Speaker 1: as soon as today in the U s. Senate, do 428 00:25:57,280 --> 00:25:59,399 Speaker 1: you think that is a wise move for the United 429 00:25:59,400 --> 00:26:02,520 Speaker 1: States to to try to pressure Russia in some of 430 00:26:02,600 --> 00:26:06,560 Speaker 1: the rhetoric and frankly the Ukrainian border. Well, that's a 431 00:26:06,640 --> 00:26:10,560 Speaker 1: big problem and it really requires reading Putin's mind. The 432 00:26:10,680 --> 00:26:15,520 Speaker 1: question is if you if you legislate that now, uh 433 00:26:15,640 --> 00:26:18,600 Speaker 1: and the administration has made this point, you're reducing some 434 00:26:18,800 --> 00:26:22,840 Speaker 1: of their negotiating leverage over the Russians in the future. 435 00:26:23,520 --> 00:26:29,680 Speaker 1: Um and Sergei Ryabkoff and Wendy Sherman were both very 436 00:26:29,840 --> 00:26:34,080 Speaker 1: skilled negotiators, are trying to work things out. If you 437 00:26:34,240 --> 00:26:37,359 Speaker 1: sort of stick your nose in the Russians face, even 438 00:26:37,440 --> 00:26:41,760 Speaker 1: if there's a strategic benefit for the United States to 439 00:26:42,760 --> 00:26:45,920 Speaker 1: tweaking the Russians and putting pressure on them, it does 440 00:26:46,119 --> 00:26:50,359 Speaker 1: make the negotiations harder and and puts Putin in a 441 00:26:50,520 --> 00:26:55,040 Speaker 1: much more aggressive move because I'm saying, you're you're taking 442 00:26:55,119 --> 00:26:59,200 Speaker 1: unilid of election that's going to adversely effect and our 443 00:26:59,320 --> 00:27:02,320 Speaker 1: and our in our neighbors, because don't forget, there's a 444 00:27:02,359 --> 00:27:06,040 Speaker 1: big difference among the Europeans on this. Some Europeans want 445 00:27:06,760 --> 00:27:10,680 Speaker 1: UH nord string to some do not. And you have 446 00:27:10,880 --> 00:27:15,680 Speaker 1: now thirty countries in Western Europe united against Russia. I'm 447 00:27:15,720 --> 00:27:21,080 Speaker 1: supporting the US for the us UH to do this unilaterally, 448 00:27:21,200 --> 00:27:23,720 Speaker 1: I think with last Division North, which would not help 449 00:27:24,080 --> 00:27:26,840 Speaker 1: the negotiators. Robert Harmaz, thank you so much. That's all 450 00:27:26,840 --> 00:27:30,439 Speaker 1: the time we've got for today. Titaman Advisors, Invessador Robert. 451 00:27:32,119 --> 00:27:35,880 Speaker 1: This is the Bloomberg Surveillance Podcast. Thanks for listening. Join 452 00:27:36,000 --> 00:27:39,399 Speaker 1: us live weekdays from seven to ten am Eastern. I'm 453 00:27:39,440 --> 00:27:43,640 Speaker 1: Bloomberg Radio and on Bloomberg Television each day from six 454 00:27:43,800 --> 00:27:48,600 Speaker 1: to nine am for insight from the best in economics, finance, investment, 455 00:27:48,800 --> 00:27:55,480 Speaker 1: and international relations. And subscribe to the Surveillance podcast on Apple, podcast, SoundCloud, 456 00:27:55,680 --> 00:27:59,200 Speaker 1: Bloomberg dot com, and of course on the terminal. I'm 457 00:27:59,320 --> 00:28:01,840 Speaker 1: Tom Keene. This is Bloomer