Speaker 1: Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keane. Along
Speaker 1: with Jonathan Ferrell and Lisa A. Brawnowitz Jaily, we bring
Speaker 1: you insight from the best and economics, finance, investment, and
Speaker 1: international relations. Find Bloomberg Surveillance on Apple Podcast, Suncloud, Bloomberg
Speaker 1: dot Com, and of course on the Bloomberg terminal. This
Speaker 1: is a joy and Harkins back in his twenty years
Speaker 1: at Columbia to lead Bollinger and myself in conversation at Davos.
Speaker 1: I'm gonna say two thousand four, two thousand five in
Speaker 1: his vision of a Columbia university that would support Harlem
Speaker 1: and support New York City with Manhattanville, that is now.
Speaker 1: And they have moved forward from Bollinger to the great
Speaker 1: architect Renzo Piano to Professor Cohen joining us how ev
Speaker 1: Joseph Cohen of course always with god Been Sacks No
Speaker 1: former Golden Sex senior investment strategists and professor at Geffen
Speaker 1: five Columbus Business School. I mean, you're going to start
Speaker 1: your Future of Global Economy course remote because of COVID,
Speaker 1: because of a macron is Well, when you get to
Speaker 1: Geffen five nine, how will you lecture the business students.
Speaker 1: What will you bring to them different? Well, Tom, first
Speaker 1: of all, thank you for inviting me to be here
Speaker 1: this morning. This, in fact is the first time I've
Speaker 1: been speaking since my shift over from Goldman Sachs. UM.
Speaker 1: I'm ecstatic about this change, UM, moving to the Columbia
Speaker 1: Business School and the Global Economics and Financial Markets course
Speaker 1: that I'll be teaching is actually, of course I've been
Speaker 1: teaching for the past eight or nine years. UM. I've
Speaker 1: been a longstanding adjunctum at Columbia UM, and I consider
Speaker 1: it to be a great intellectual home. Of course, it's
Speaker 1: health is a combination of theory and practice. I have
Speaker 1: the opportunity to teach with one of the wonderful tenured
Speaker 1: professors at Columbia, gentleman by the name of Pierre ja Ed,
Speaker 1: who will be covering a lot of the theoretical macro
Speaker 1: and I'll be talking about, well, what's really happened in
Speaker 1: the markets, not just over the last few days, but
Speaker 1: if you will, over the last several decades, trying to
Speaker 1: put this all in perspective for our students. The perspective
Speaker 1: needed away from your prodigious math abilities, is the new
Speaker 1: capitalism Columbia Business School has supporters with names that we
Speaker 1: know on surveillance. Cravis Cooperman, of course, the great gentleman
Speaker 1: from entertainment, David Geffen. How do the new capitalists and
Speaker 1: the budding NBA students, how do they deal with a
Speaker 1: new more responsible capitalism. That's a terrific question, Tom. And
Speaker 1: let's keep in mind that at Columbia is also this
Speaker 1: great legacy of intellectual capital Uh. Some of the great
Speaker 1: things in terms of capital markets in the nineteen thirties
Speaker 1: and forties also had relationships at Columbia strong economics department,
Speaker 1: strong finance department, people like Ben Graham for example. UM.
Speaker 1: And so what I see in the new students is
Speaker 1: really quite interesting. At Columbia, about half of the students
Speaker 1: in my course are in fact non Americans, and they
Speaker 1: bring an incredible global perspective to what we're seeing. You.
Speaker 1: Very often, when we look at structural change in the
Speaker 1: United States, we say, nobody else has ever dealt with
Speaker 1: us before. Well, we are actually incorporating the experiences of
Speaker 1: our students as well. We do find that this generation
Speaker 1: of students is very much interested in a few things. Uh.
Speaker 1: Number One, they'd like to know how companies run obviously,
Speaker 1: and our course we also talk about how government policy
Speaker 1: is made, and we give the students opportunities to eight
Speaker 1: what should those policies look like. And among the topics
Speaker 1: we addressed, of course of things like E. S. G.
Speaker 1: But we also look at things like regulatory changes, things
Speaker 1: that might need to be adjusted as the structure of
Speaker 1: an economy changes. And of course I always love to
Speaker 1: talk about the fundamentals the data in the economy, but
Speaker 1: also the valuation of the markets. And when I say
Speaker 1: the markets, it's not Lisa Brandma. Do you know somebody
Speaker 1: in row seven is gonna stand up and say, hey, Abby,
Speaker 1: what do you think of the market? That's where? And
Speaker 1: so I'll do it. I'll stand up in in row
Speaker 1: thirty six and say, we just got this PPI data
Speaker 1: after yesterday's CPI data, we're now pricing in about four
Speaker 1: rate hikes. Were in a new regime for inflation. What's
Speaker 1: the market call at a time when most strategists are
Speaker 1: bullets on equities. Yeah, I I think in fact, the
Speaker 1: regime change, Lisa, occurred a few months ago when we
Speaker 1: began to see data suggesting that inflation was rising, that
Speaker 1: interest rates would be moving up and underneath the surface
Speaker 1: of the market indusicries. We have seen a great deal
Speaker 1: of action, obviously the rise of volatility, but we're also
Speaker 1: seeing that investors are starting to move away from the
Speaker 1: big mo uh. And that big mo for many years,
Speaker 1: of course, was fixed income by bonds, regardless of the
Speaker 1: interest rates. We see that investors becoming much more selective
Speaker 1: and fixed income, and of course we see that in
Speaker 1: equities as well. The thing that is always so important
Speaker 1: is what's already baked in uh two expectations. UH. My
Speaker 1: feeling is that we have a few surprises ahead in
Speaker 1: the equity market, some good, some not so good. But
Speaker 1: the key for me is always the valuation support. And
Speaker 1: that valuation support is not particularly good in some segments
Speaker 1: of the market um, and some it looks pretty good.
Speaker 1: Um uh. There are some growthy areas that are not
Speaker 1: yet priced excessively. But the overall market I think will
Speaker 1: be volatile because the only valuation metrics that still look
Speaker 1: appealing are the ones that are linked to low inflation,
Speaker 1: low interest rates. As those continue to move up somewhat
Speaker 1: in two UH, the equity market comes under some pressure.
Speaker 1: I think pe ratios for the overall market compress somewhat. Um,
Speaker 1: I think there's some offset in terms of continued improvements
Speaker 1: in earnings growth, because I certainly don't see a recession.
Speaker 1: So I think the real action in the market is
Speaker 1: going to be under the surface, not so much in
Speaker 1: the indsease. And based on that, this idea of the
Speaker 1: action under the surface, how much of that is pricing
Speaker 1: in a perfect transition to a tightening cycle. This idea
Speaker 1: of an excit and threading a needle that by all
Speaker 1: accounts is going to be tough for the FED to
Speaker 1: do well. You raise two very interesting points. Number one,
Speaker 1: the needle that the FED has to thread, and they'll
Speaker 1: be doing it through a combination I believe, of increases
Speaker 1: in short rates but also adjusting that balance sheet. Could
Speaker 1: there be another temper tantrum maybe, But I think the
Speaker 1: Fed is actually doing a great job by signaling these
Speaker 1: things ahead of time. You know, when I started as
Speaker 1: a junior economist the Federal Reserve Board in Washington, the
Speaker 1: rule of thumb then was you didn't tell the markets
Speaker 1: anything about what you plan to do as policymakers, and
Speaker 1: two to three months later you'd start to tell people
Speaker 1: what in fact had already happened. That's not the way
Speaker 1: it works now. I think the signaling that gets done
Speaker 1: by the FED is actually very very helpful in that regard.
Speaker 1: So that's one needle that has to be threaded. I
Speaker 1: think the FED has begun to do a very good job.
Speaker 1: The other needle that has to be threaded is how
Speaker 1: to position portfolios. And I think that institutional investors UM
Speaker 1: have been talking about this, they haven't been doing it.
Speaker 1: I worry much more so about individual investors, many of
Speaker 1: whom haven't yet figured out the damage that could occur
Speaker 1: to their personal portfolios as interest rates begin to rise
Speaker 1: UM and and that to me is concerning. And so
Speaker 1: when we think about, you know, shocks to the system
Speaker 1: when the valuation supports not so good, we can't assume
Speaker 1: a smooth transition. There are some risks out there that
Speaker 1: could knock us off balance. People talk for always about
Speaker 1: the pandemic, which is not over. We need to worry
Speaker 1: about what's happening in other countries were vaccine distribution has
Speaker 1: been quite limited. We also need to worry about a
Speaker 1: disruption and fixed income markets and what that could do.
Speaker 1: UM and I know that there are some people out
Speaker 1: there who are concerned about what happens when people recognize
Speaker 1: that there's now been a big difference between cap market
Speaker 1: performance and equally, and then when they ask you for
Speaker 1: your market calle, just tell them yield up, price down
Speaker 1: and leave it at that. Professor Cohen, thank you so
Speaker 1: much for joining us today with Columbia Business School. Let's
Speaker 1: get right to it. Lisa Shallott joins us the chief
Speaker 1: investment officer Morgan Stanley Wealth Management. Lisa, I want to
Speaker 1: cut to the chase. How much cash do you need
Speaker 1: right now? As cash a negative thing, or as cash
Speaker 1: and a portfolio a positive construct. So we're looking at
Speaker 1: cash as an opportunistic asset right here. Um, if you
Speaker 1: look underneath the surface of these indices, you know you've
Speaker 1: got of the stocks in the market have actually corrected
Speaker 1: from fifty two week highs, and many have corrected as
Speaker 1: much as ten or so. UM. We think that this
Speaker 1: is an opportunistic stock picker's market. But you have to
Speaker 1: do your homework, and that homework really requires understanding UH.
Speaker 1: If if you've got enough defensiveness in your names, if
Speaker 1: you've got quality, if you've got the potential to beat
Speaker 1: UH profit forecasts, if you've got the potential to raise
Speaker 1: dividends and do buybacks, because those are the types of things, uh,
Speaker 1: that are going to allow your your stock to be
Speaker 1: resilient in against a tape where the FED is raising
Speaker 1: rates and the cost of capital is drifting higher, which
Speaker 1: means price earnings ratios are drifting lower at least. So
Speaker 1: this cycle has moved at a rapid pace. Is it
Speaker 1: too early still to say this is light cycle? It's
Speaker 1: a light psychodynamic now, UM, I think it's a little
Speaker 1: I think it's a little early to say that. You know,
Speaker 1: we've we've been um, you know, pretty consistent saying that
Speaker 1: this is a mid cycle transition. Um. Certainly the labor
Speaker 1: market with unemployment below four percent is starting to feel
Speaker 1: late cycle to us. We are in the camp that
Speaker 1: says structural changes have happened in the labor market that
Speaker 1: are going to prevent participation rates from you know, rapidly
Speaker 1: mean reverting to to where we were pre pandemic. UM.
Speaker 1: But we do think that that there's a big trunk
Speaker 1: of the economy that has yet to recover, and that's
Speaker 1: really the consumer services part of the economy. So we're
Speaker 1: still in that you know, it's a late mid cycle
Speaker 1: as opposed to explicitly late cycle, well late mid cycle,
Speaker 1: at a time when the market is currently pricing in
Speaker 1: about four rate hikes in two I keep asking investors
Speaker 1: have equities fully priced this in yet? And frankly, the
Speaker 1: answer has come back, Yeah, everybody knows it's priced in.
Speaker 1: Do you agree? I don't. I I think that the
Speaker 1: stock market has been extraordinarily skeptical of the FED. I
Speaker 1: think that that, you know, when you have had as
Speaker 1: powerful a FED put as we have had in this
Speaker 1: market quite frankly for the past thirteen years, going all
Speaker 1: the way back to the Great Financial Crisis and in
Speaker 1: March of two thousand and nine, UM, it's really hard
Speaker 1: to convince people that that the regime is shifting. Uh.
Speaker 1: So we do think that that certainly the indices, some
Speaker 1: of the more richly valued names, uh that we all know,
Speaker 1: those those Taflon megacap tech names, uh, you know, still
Speaker 1: need to reprice UM a decent amount, maybe maybe ten
Speaker 1: to fifteen percent to reflect What we do think is is, uh,
Speaker 1: you know, the distance forward on rates. So you think
Speaker 1: that big tech still needs to correct ten to fifteen
Speaker 1: percent from here. Just to make that very clear, I
Speaker 1: have to think what's the trigger Given the fact that
Speaker 1: we just got c p I coming in at the
Speaker 1: hottest level in thirty nine years, we're about to get
Speaker 1: a similar read from p p I. Yeah. Look, I
Speaker 1: think it's a question of actually seeing the Fed follow through. Um.
Speaker 1: You know, certainly we now planted the seeds that not
Speaker 1: only are rate hikes on the table, and rate hikes
Speaker 1: on the table as early as March, but you know
Speaker 1: the Fed minutes really planted the seeds that perhaps we're
Speaker 1: gonna see balance she run off. Now, balance sheet runoff
Speaker 1: really contributes to actual tightening and really ultimately translates into
Speaker 1: the equivalent of additional rate hikes. So I think once
Speaker 1: there's more clarity on that, that will be quote unquote
Speaker 1: the last down leg in the market among those names
Speaker 1: that again here tofore have have you know, proven um
Speaker 1: kind of resilient teflon like Lisa three to five years out.
Speaker 1: How do you rationalize double digit revenue growth at the
Speaker 1: at the technology profit makers, not the ones where there's
Speaker 1: a story, but the ones that are minting free cash
Speaker 1: law every day? How do you approach those with a
Speaker 1: longer term time arizon. Well, Tom, I love your question
Speaker 1: because this is the conversation we're having with clients every
Speaker 1: single day. What we're trying to get folks to understand
Speaker 1: is it's not a question of whether these are great companies.
Speaker 1: It's a question of whether they're great stocks and what's
Speaker 1: priced in and how realistic is it that some of
Speaker 1: the growth rates that we've seen, much of which have
Speaker 1: included a pull forward, a pull forward of demand because uh,
Speaker 1: many of these themes were linked to work from home
Speaker 1: or were linked to some of the the unique dimensions
Speaker 1: of this pandemic. Um, can you really make the case
Speaker 1: that those double digit type growth rates are going to sustain?
Speaker 1: And history is just not kind on this point. Uh.
Speaker 1: You know, innovation is terrific, but so is disruption. Uh.
Speaker 1: And it's very rare for companies decade after decade to
Speaker 1: be able to sustain these levels of growth without quite frankly,
Speaker 1: being uh disrupted by competition. And think, yeah, this is
Speaker 1: really important. I wish we had an hour for this,
Speaker 1: but we've got such a great hour, Lisa for you
Speaker 1: to start. Can they go play Christiansen and bring the
Speaker 1: disruption inside? Um? Looks certainly they can, uh, and and
Speaker 1: perhaps they may transform themselves. Obviously a lot of these
Speaker 1: high flyers are are now you know, they've gone beyond
Speaker 1: betting on on you know, social media, they bet on
Speaker 1: the cloud UH and cloud services and and now they're
Speaker 1: betting on metaverse and and you know, some of the
Speaker 1: virtual UH services. Look, perhaps some of these companies will
Speaker 1: make that transition to UH you know, leadership yet again
Speaker 1: in these emerging markets. But we continue to believe that
Speaker 1: the next set of market leaders are going to be
Speaker 1: a different set of six or seven companies if we look,
Speaker 1: you know, three to five years from now. Lisa Shount
Speaker 1: of Morgan Stanley Wealth Management, Lisa, wonderful to catch up
Speaker 1: with you. You know that we always enjoy it. Thank you.
Speaker 1: Joining us now is Tony for sense markets trying to
Speaker 1: just and pull folio manager and Pimco. Tonny, great to
Speaker 1: have you bank with, especially stop right here. So we've
Speaker 1: got the strongest print we've seen going all the way
Speaker 1: back too. We've talked a lot about it in the
Speaker 1: last twenty four rounds. The question lasked Tom just moments ago,
Speaker 1: I'll ask you to view how hard would it be
Speaker 1: for the FED to deliver more than what this market
Speaker 1: is already looking for in twenty two Quite difficult, but
Speaker 1: you could see the power. The power of communications. One
Speaker 1: of the chief tools the FED has. It can use
Speaker 1: words and then perhaps use action later, so it doesn't
Speaker 1: have to deliver that action this year necessarily indicated may
Speaker 1: have to do more. So we're in the future. And
Speaker 1: of course the quantitative tightening, which we see not occurring
Speaker 1: until September who knows, could be pulled forward as one
Speaker 1: other tool and perhaps use that in place of of
Speaker 1: a hike. We're looking for three to four heights this year,
Speaker 1: rich Jonathan. One of the key things stories for the
Speaker 1: bond market, for the stock market, for the credit markets,
Speaker 1: markets more broadly, is the market price for enough in
Speaker 1: terms of the terminal rate the markets thing the FED
Speaker 1: will have will stop somewhere around one or three quarters
Speaker 1: to the FED things mutual is two and a half.
Speaker 1: So there's a battle out there in the future. Potentially,
Speaker 1: if the inflation rate stays high and the JAVA strate
Speaker 1: keeps falling, we reach late cycle dynamics with the FED
Speaker 1: has to tell markets we need to do more, and
Speaker 1: then that's when is more trouble. Let's go to page
Speaker 1: two of your claimed book. How far out as a
Speaker 1: terminal rate given a natural disaster. You can't go out
Speaker 1: seven years now, you can't go out ten years as
Speaker 1: a terminal rate. Fourth of July. Well, as you said
Speaker 1: Tom earlier, you've all been talking about the amount of
Speaker 1: hikes built into this year. You see, the comfort level
Speaker 1: is pretty good right now. With the four hikes. The
Speaker 1: stock market, the bond market didn't react to Powace Hawfishness
Speaker 1: didn't react to the new highs and the CPI. The
Speaker 1: markets also priced for three hikes three but then nothing,
Speaker 1: uh pretty much? Is that? Nothing? Too little? That's the
Speaker 1: big the money, the money question, with great respect to
Speaker 1: the gazillion dollars at him go manages. Are you managing
Speaker 1: the short term? Tony krissenzis space for the end of
Speaker 1: the world. You're all in cash, your wicked short duration.
Speaker 1: Let's see if they talk, folks, or are you guys
Speaker 1: saying no, the gloom is wrong and we're going to
Speaker 1: extenderation to find a coupon in some total return. Which
Speaker 1: is it? It's more of the former, but there's a
Speaker 1: little bit of the ladder, a lot of it's the
Speaker 1: portfolio context, and investors should always have the portfolio in mind.
Speaker 1: The credit beta, the equity beta, the correlation to the
Speaker 1: other assets in the portfolio when buying bonds, think about
Speaker 1: that idea you just brought up tom uh In In
Speaker 1: a sense you said, are you considering market timing? Uh
Speaker 1: in a portfolio that's balanced and market timing the diversification
Speaker 1: benefits of bonds is akin to getting in a car
Speaker 1: and saying today, I think I would be safe. I
Speaker 1: don't need car insurance. Not to say that bonds are insurance,
Speaker 1: but they do provide some benefit in the case that
Speaker 1: there's a so called accident. So we are underweight duration.
Speaker 1: We do think markets are a bit underpriced for the
Speaker 1: potential for an increase in the terminal rate from the
Speaker 1: one and three quarters or so that's built into what
Speaker 1: the Fed thinks is neutral, but it probably would not
Speaker 1: get much beyond the two's. And so when looking out
Speaker 1: on the Bloomberg terminal at the five year five year,
Speaker 1: as they say, where's the where is the market think
Speaker 1: the five year treasury will be in five years? Most
Speaker 1: yields across the yield curve the term structure as they
Speaker 1: call it in the books, are around two pretty flat curve,
Speaker 1: which is a way of saying the Fed will will
Speaker 1: be successful in the long run, any kids moves policy
Speaker 1: rate up much. So that's what the market saying. We
Speaker 1: we disagree to an extent, but not a lot tony.
Speaker 1: In the meantime, we're looking at actual yield, at actual
Speaker 1: return in cash, at the actual return in the short
Speaker 1: term space. Do you think that this is going to
Speaker 1: be one of the best years in a while for
Speaker 1: people who are keeping their money? Uh in it that's
Speaker 1: sort of cash like space. Yes, because we've had already
Speaker 1: seen an increasing looking look at the two year Treasury
Speaker 1: note at ninety basis points, historically I would have said, well,
Speaker 1: when the two year treasury gets to a hundred basis
Speaker 1: points over the fideral fronds rate, that's kind of it
Speaker 1: for yields in general. There are times though when it
Speaker 1: can be higher than that. Even as why there's two
Speaker 1: hundred basis points, so there maybe more in terms of
Speaker 1: yield increases if the market thinks the FEDS actions aren't enough.
Speaker 1: But stepping outside of what they call the to A
Speaker 1: seven world, the regulated world, that's for the money market.
Speaker 1: We all do. It's an exciting thing to do, isn't it,
Speaker 1: uh Tom At the two A seven world dictates that
Speaker 1: money market funds have a mature average maturities around sixty days.
Speaker 1: UH should cap their cap there. And there's limitations on
Speaker 1: the types of credits, so stepping outside that a little
Speaker 1: bit can get an investor a little more yield, but
Speaker 1: you've got to be judicious about it. So any wonderful
Speaker 1: to catch you up and send out to put this
Speaker 1: cyclical outlook this week. Brilliant rad Thank you Sonny, Tony
Speaker 1: Christency that of Pim cog Looking at the many fronts
Speaker 1: of Russia right now. It used to be simple math.
Speaker 1: There was one front, there were two fronts. This morning
Speaker 1: there are three or four fronts. For Lisa brand Woods
Speaker 1: and myself for all of you on radio and television.
Speaker 1: A wonderful time to speak to Ambassador Hormats. Robert Hormats
Speaker 1: is managing director of Titaman Advisers, but far far more
Speaker 1: with his experience from Northern Ireland deep to kazakh Stun
Speaker 1: as well. Bob, I don't even know where to start,
Speaker 1: but I guess I'll start with kazakh Stun because I
Speaker 1: would suggest that is where Americans are most ignorant. Explained
Speaker 1: from a diplomacy standpoint, the importance for America of kazakh
Speaker 1: stun Well, kazak Stand first of all, is a large supply,
Speaker 1: ire and transit vehicle for natural gas and for oil,
Speaker 1: some of which goes to China, but some but also
Speaker 1: particularly from the Caspian, goes to um Western Europe and
Speaker 1: the West. So Second, energy energy, particularly uranium where they
Speaker 1: are however, you measured between forty and of the world's
Speaker 1: uranium production comes from lu Stand and now we're building
Speaker 1: up nuclear power, they're extremely important. And third is they're
Speaker 1: very strategically located. Other than Mongolia, which is sort of
Speaker 1: sandwiched in between Russia and China, they're the only country
Speaker 1: in the world that has a border with both China
Speaker 1: and UH. So the fact that their Russian troops there
Speaker 1: for the moment is not worrisome because they'll probably even
Speaker 1: their stability, but they could be another, as you put it,
Speaker 1: front on the on the Russian desire to expand its
Speaker 1: influence Bob, what is our diplomatic inertial force forward, China's
Speaker 1: got a view, Russia's got a view. Our view is
Speaker 1: an isolation as toned back two hundred and fifty years,
Speaker 1: and the idea that Kazakhstan's on the other side of
Speaker 1: the world. What is the diplomatic omph that Republicans and
Speaker 1: democrats can generate towards this important part of the world
Speaker 1: very little. Um. In fact, there's a curiosity here, and
Speaker 1: that is, we don't want the Russians, don't want the Chinese,
Speaker 1: don't want instability in Kazakhstan for various reasons. And that is,
Speaker 1: you know, it's on the borders of Russia and China
Speaker 1: and and and if it weren't unstable, it would be
Speaker 1: an opportunity for the Russians in particular to expand their influence.
Speaker 1: But we really have have had very good relations with
Speaker 1: the Kasacks. I've been there when I was in and
Speaker 1: several times, and Altobia have tried to play a very
Speaker 1: clever role between Russia, the US and China. But um,
Speaker 1: if it becomes an unstable place and a lot of instability,
Speaker 1: it affects the world's energy supplies and your fect the
Speaker 1: world's uranium supplies, and it makes for more political volatility.
Speaker 1: UM in Central Asia. That's the biggest degree in the region.
Speaker 1: Investador hormats. As the whole world moves toward a less
Speaker 1: fossil fuel intensive energy regime, I do wonder whether United States,
Speaker 1: Is has enough of a footprint in some of these
Speaker 1: countries that provide such a huge proportion of the raw
Speaker 1: materials needed to engage in some of these plans. What's
Speaker 1: your view on that at a time when Russia and
Speaker 1: China are moving together to try to solidify their strategic
Speaker 1: positioning in that region. Well, that's a great point, because
Speaker 1: the Kazaks really have been suppliers, particularly for American oil
Speaker 1: come Penis of a lot of oil, but not all
Speaker 1: it comes to the US, but it does go over
Speaker 1: some of our friends and allies infect the world price,
Speaker 1: so it does. It does matter a lot. Uh in
Speaker 1: terms of our our influence there. Uh from a geopolitical
Speaker 1: point of view, it's far far less than the Russians
Speaker 1: or the Chinese, and therefore our ability to really play
Speaker 1: a major role as significant. But we want stability there.
Speaker 1: The Russians and the Chinese do too. We don't want
Speaker 1: it to be used as a base for radical johadas.
Speaker 1: I don't think it will be because because I don't
Speaker 1: want that. But it's it's very important quantitatively on energy
Speaker 1: and strategically just because of worth located and what neighbors are.
Speaker 1: Given your former experience as an ambassador, and given that
Speaker 1: the vote for the nord stream to sanctions could come
Speaker 1: as soon as today in the U s. Senate, do
Speaker 1: you think that is a wise move for the United
Speaker 1: States to to try to pressure Russia in some of
Speaker 1: the rhetoric and frankly the Ukrainian border. Well, that's a
Speaker 1: big problem and it really requires reading Putin's mind. The
Speaker 1: question is if you if you legislate that now, uh
Speaker 1: and the administration has made this point, you're reducing some
Speaker 1: of their negotiating leverage over the Russians in the future.
Speaker 1: Um and Sergei Ryabkoff and Wendy Sherman were both very
Speaker 1: skilled negotiators, are trying to work things out. If you
Speaker 1: sort of stick your nose in the Russians face, even
Speaker 1: if there's a strategic benefit for the United States to
Speaker 1: tweaking the Russians and putting pressure on them, it does
Speaker 1: make the negotiations harder and and puts Putin in a
Speaker 1: much more aggressive move because I'm saying, you're you're taking
Speaker 1: unilid of election that's going to adversely effect and our
Speaker 1: and our in our neighbors, because don't forget, there's a
Speaker 1: big difference among the Europeans on this. Some Europeans want
Speaker 1: UH nord string to some do not. And you have
Speaker 1: now thirty countries in Western Europe united against Russia. I'm
Speaker 1: supporting the US for the us UH to do this unilaterally,
Speaker 1: I think with last Division North, which would not help
Speaker 1: the negotiators. Robert Harmaz, thank you so much. That's all
Speaker 1: the time we've got for today. Titaman Advisors, Invessador Robert.
Speaker 1: This is the Bloomberg Surveillance Podcast. Thanks for listening. Join
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Speaker 1: Tom Keene. This is Bloomer