1 00:00:05,120 --> 00:00:09,320 Speaker 1: Welcome to the Bloomberg Surveillance Podcast Hometown Keene. Along with 2 00:00:09,440 --> 00:00:13,720 Speaker 1: Jonathan Ferrill and Lisa Brownwitz Jailey, we bring you insight 3 00:00:13,840 --> 00:00:18,640 Speaker 1: from the best and economics, finance, investment and international relations, 4 00:00:18,960 --> 00:00:23,840 Speaker 1: Fine Bloomberg Surveillance and Apple podcast SoundCloud, Bloomberg dot Com, 5 00:00:23,920 --> 00:00:30,200 Speaker 1: and of course on the Bloomberg terminal. The story in 6 00:00:30,240 --> 00:00:32,680 Speaker 1: Europe much more complex. It's been a tough few months 7 00:00:32,720 --> 00:00:35,280 Speaker 1: to roll out this vaccine, and now Germany has outlined 8 00:00:35,320 --> 00:00:37,519 Speaker 1: some plans to gradually reopen the economy. I'm pleased to 9 00:00:37,560 --> 00:00:39,640 Speaker 1: say that still with us is our colleague, Bloomberg's Mat Miller, 10 00:00:39,800 --> 00:00:41,760 Speaker 1: and I'm very happy to say the German finance minister 11 00:00:41,840 --> 00:00:44,599 Speaker 1: joins us. Now all have Scholtz, Minister, fantastic to catch 12 00:00:44,680 --> 00:00:46,360 Speaker 1: up with you, sir. I just want to start with 13 00:00:46,360 --> 00:00:50,080 Speaker 1: the vaccine strategy in Europe, which you've reportedly called, and 14 00:00:50,120 --> 00:00:53,360 Speaker 1: forgive me for my language, sir, a real pile of crap. 15 00:00:53,960 --> 00:00:56,360 Speaker 1: It's that a fair characterization of how you see things 16 00:00:56,480 --> 00:00:58,400 Speaker 1: and how you've seen things play out in Europe over 17 00:00:58,440 --> 00:01:04,240 Speaker 1: the last several months. I think there was a problem 18 00:01:04,280 --> 00:01:08,800 Speaker 1: in ordering enough vaccines in the last year, but now 19 00:01:08,840 --> 00:01:12,200 Speaker 1: anyone is working very hard to work that we will 20 00:01:12,240 --> 00:01:15,600 Speaker 1: have enough vaccines to bring it to the people, and 21 00:01:15,680 --> 00:01:19,119 Speaker 1: this is what is organized in all the countries, also 22 00:01:19,160 --> 00:01:26,560 Speaker 1: in Germany. What went wrong, Minister, it's just the one sentence. 23 00:01:26,600 --> 00:01:30,640 Speaker 1: I already said. There could should have been more. There 24 00:01:30,640 --> 00:01:34,880 Speaker 1: should have been more activity to organize more vaccines, and 25 00:01:35,040 --> 00:01:39,560 Speaker 1: especially if you understand that most of the important developments 26 00:01:39,600 --> 00:01:43,559 Speaker 1: for modern vaccines have been made in Europe, and two 27 00:01:43,600 --> 00:01:47,640 Speaker 1: of the three big companies that develop new vaccines Moderna 28 00:01:47,760 --> 00:01:51,680 Speaker 1: and que Vac and BioNTech are from Germany. So this 29 00:01:51,880 --> 00:01:55,080 Speaker 1: is a good basis for doing the right things. But 30 00:01:55,200 --> 00:01:57,160 Speaker 1: in the end, I think we are now on the 31 00:01:57,160 --> 00:02:00,840 Speaker 1: wreck right track, and anyone is working very hard in 32 00:02:00,880 --> 00:02:04,720 Speaker 1: all the countries, and we are now fascinating the people, 33 00:02:04,840 --> 00:02:07,880 Speaker 1: and we are organizing that this will happen as fast 34 00:02:07,920 --> 00:02:10,600 Speaker 1: as possible, and there will be in a short time 35 00:02:10,720 --> 00:02:16,000 Speaker 1: millions of people that got the ability to have their vaccine. 36 00:02:17,560 --> 00:02:21,600 Speaker 1: Minister Shultz, considering that those companies are German, why didn't 37 00:02:21,760 --> 00:02:25,440 Speaker 1: the government act to get them first, those vaccines out 38 00:02:25,440 --> 00:02:30,160 Speaker 1: to the German people right away. I think it is 39 00:02:30,160 --> 00:02:33,880 Speaker 1: absolutely clear that this is something that should be organized 40 00:02:34,440 --> 00:02:38,120 Speaker 1: in Europe together and it's also clear that this is 41 00:02:38,160 --> 00:02:42,360 Speaker 1: something that should be part of an international collaboration which 42 00:02:42,400 --> 00:02:47,600 Speaker 1: is working necessarily for saving the world. And as you know, 43 00:02:47,760 --> 00:02:51,400 Speaker 1: we are already working very hard on international and global 44 00:02:51,440 --> 00:02:55,400 Speaker 1: initiatives supporting those countries who have not the means to 45 00:02:55,400 --> 00:02:59,119 Speaker 1: to organize the vaccines for themselves, because if we want 46 00:02:59,160 --> 00:03:02,799 Speaker 1: to fight so successfully against the pandemy, it will be 47 00:03:03,200 --> 00:03:06,640 Speaker 1: necessary that we give the chance to all the people 48 00:03:07,000 --> 00:03:09,920 Speaker 1: on the globe. Coming back to Europe, coming back to Germany, 49 00:03:09,960 --> 00:03:14,160 Speaker 1: I think we will make it well. You're responsible for 50 00:03:14,240 --> 00:03:18,400 Speaker 1: dealing with the damage done now by extended lockdowns to 51 00:03:18,440 --> 00:03:23,000 Speaker 1: the German economy. Our reporter Berge yain and found that 52 00:03:23,040 --> 00:03:26,480 Speaker 1: the government is considering as much as fifty billion euros 53 00:03:26,560 --> 00:03:30,400 Speaker 1: in additional debt spending and supplemental debt spending in order 54 00:03:30,440 --> 00:03:33,640 Speaker 1: to deal with the deeper damage from the extended lockdown. 55 00:03:33,720 --> 00:03:39,920 Speaker 1: Can you confirm that we will do extra activities. Yes, 56 00:03:40,000 --> 00:03:42,360 Speaker 1: this is true and we are able to do so. 57 00:03:42,440 --> 00:03:46,560 Speaker 1: As you know, we were in Europe the first to 58 00:03:47,120 --> 00:03:51,280 Speaker 1: fight against the pandemic with fiscal means. In the last year, 59 00:03:51,360 --> 00:03:55,200 Speaker 1: we developed the first a very strong recovery program, and 60 00:03:55,320 --> 00:03:59,080 Speaker 1: we managed the political activity that made it possible that 61 00:03:59,200 --> 00:04:04,200 Speaker 1: the whole European Union is answering together to this crisis. 62 00:04:04,560 --> 00:04:08,560 Speaker 1: The effect on the German economy is obvious. We are 63 00:04:09,600 --> 00:04:13,480 Speaker 1: having a very good situation at the labor market and 64 00:04:13,640 --> 00:04:16,440 Speaker 1: it is much better than anyone expected the last year. 65 00:04:16,800 --> 00:04:20,760 Speaker 1: We have a very good situation in the economy, and 66 00:04:20,800 --> 00:04:24,560 Speaker 1: if you compare the development of the German economy to 67 00:04:24,680 --> 00:04:30,239 Speaker 1: other countries in the world, you see we are between 68 00:04:30,320 --> 00:04:34,840 Speaker 1: the best fighting against the economic consequences of the crisis. 69 00:04:36,279 --> 00:04:38,200 Speaker 1: Can I just push a little bit harder to get 70 00:04:38,200 --> 00:04:42,359 Speaker 1: a figure here in terms of the additional spending that's necessary, 71 00:04:42,520 --> 00:04:46,680 Speaker 1: Mr Minister, is fifty billion euros in additional spending necessary? 72 00:04:46,760 --> 00:04:52,279 Speaker 1: Or somewhere in that ball ballpark. Your colleagues from Germany 73 00:04:52,320 --> 00:04:55,640 Speaker 1: asked the same question to me, and I always gave 74 00:04:55,680 --> 00:04:58,919 Speaker 1: them the same answer. You will see, I didn't expect 75 00:04:58,920 --> 00:05:01,160 Speaker 1: a new answer. Just follow up on. The election is 76 00:05:01,200 --> 00:05:04,880 Speaker 1: coming up later this year. You're running against Chancellor Mercle's party. 77 00:05:05,160 --> 00:05:07,280 Speaker 1: You have to find some kind of daylight between her 78 00:05:07,640 --> 00:05:10,520 Speaker 1: and yourself on the pandemic? Where is the daylight? What 79 00:05:10,560 --> 00:05:17,400 Speaker 1: would you have done differently that wasn't done? Fighting against 80 00:05:17,440 --> 00:05:20,960 Speaker 1: the pandemic? Is a common task of the whole government, 81 00:05:21,000 --> 00:05:23,359 Speaker 1: and I think we have to be very hard and 82 00:05:23,600 --> 00:05:30,400 Speaker 1: fighting against the health crisis which is linked to the pandemic, 83 00:05:30,760 --> 00:05:34,600 Speaker 1: and save the the and save the people, and this 84 00:05:34,680 --> 00:05:36,919 Speaker 1: is what we do. And so I think it is 85 00:05:36,960 --> 00:05:40,599 Speaker 1: not a good idea to do campaigns on this question. 86 00:05:41,240 --> 00:05:44,880 Speaker 1: But obviously I think we need something which is a 87 00:05:44,920 --> 00:05:47,760 Speaker 1: plan for coming out of this situation. And this is 88 00:05:47,800 --> 00:05:51,000 Speaker 1: why I urged anyone to be very very concrete on 89 00:05:51,080 --> 00:05:54,640 Speaker 1: the question of testing and on the question of fascinating 90 00:05:54,680 --> 00:05:59,000 Speaker 1: the people. And I was also very strict in the 91 00:05:59,120 --> 00:06:02,119 Speaker 1: question we discus. Asked in the beginning that there should 92 00:06:02,160 --> 00:06:07,680 Speaker 1: have been more activity in Europe about producing and buying 93 00:06:08,080 --> 00:06:13,400 Speaker 1: the scenes and people are seking very hard. This will 94 00:06:13,480 --> 00:06:16,920 Speaker 1: be a single issue election this year. There is no 95 00:06:16,960 --> 00:06:20,000 Speaker 1: other discussion in the global economy. Right now, you're saying 96 00:06:20,000 --> 00:06:22,800 Speaker 1: there's no difference between yourself and the c DU on 97 00:06:22,920 --> 00:06:25,960 Speaker 1: the biggest issue of the last several decades in the 98 00:06:25,960 --> 00:06:28,680 Speaker 1: global economy. There is no difference in how you would 99 00:06:28,680 --> 00:06:31,680 Speaker 1: handle this crisis, on how you would reopen this economy. 100 00:06:31,720 --> 00:06:38,359 Speaker 1: There is no day like whatsoever. There are differences that 101 00:06:38,480 --> 00:06:41,520 Speaker 1: are discussed, but to be very clear, it is a 102 00:06:41,520 --> 00:06:45,320 Speaker 1: common task and I am very much urging anyone not 103 00:06:45,400 --> 00:06:48,760 Speaker 1: to do party politics and the question which is responsible, 104 00:06:49,120 --> 00:06:52,080 Speaker 1: in the question which is important for the life of 105 00:06:52,120 --> 00:06:55,720 Speaker 1: our people. This is something no one would accept. And 106 00:06:55,800 --> 00:06:59,880 Speaker 1: there is something which is different to other countries. Noble 107 00:07:00,160 --> 00:07:05,360 Speaker 1: doubted that there is really a problem with the pandemic 108 00:07:05,440 --> 00:07:08,880 Speaker 1: and the Corona virus, and no one doubted that it 109 00:07:09,040 --> 00:07:12,000 Speaker 1: was necessary to fight against it. So there is a 110 00:07:12,000 --> 00:07:16,760 Speaker 1: consensus on this question also, not not just within the 111 00:07:16,800 --> 00:07:19,640 Speaker 1: parties of the government, but also with the most of 112 00:07:19,680 --> 00:07:23,680 Speaker 1: the opposition parties. And so this consensus is helpful for 113 00:07:23,800 --> 00:07:28,160 Speaker 1: doing the right things now and being a very honest politician. 114 00:07:28,200 --> 00:07:31,080 Speaker 1: I think doing your task is the first thing if 115 00:07:31,120 --> 00:07:34,920 Speaker 1: you're running for ruling the country. And this is the 116 00:07:34,960 --> 00:07:39,000 Speaker 1: task we have now. And yes, we are the one 117 00:07:39,000 --> 00:07:42,840 Speaker 1: fighting for the idea that this must be done, saving 118 00:07:42,840 --> 00:07:46,640 Speaker 1: the economy, working on social cohesion, looking at the people 119 00:07:46,920 --> 00:07:50,520 Speaker 1: who are suffering most and supporting them, and fighting against 120 00:07:50,520 --> 00:07:52,920 Speaker 1: the health prices. And this is what we have to do. 121 00:07:53,040 --> 00:07:54,960 Speaker 1: They are honorable goal. Sir. Let me finish with this one, 122 00:07:54,960 --> 00:07:57,560 Speaker 1: because there's a big problem in Europe developing on acceptance 123 00:07:57,560 --> 00:08:04,239 Speaker 1: of the vaccine. Have you had the vaccines. I haven't 124 00:08:04,280 --> 00:08:08,400 Speaker 1: been vaccined because there has been uh an agreement on 125 00:08:08,480 --> 00:08:11,200 Speaker 1: who will be the first and who will be the last, 126 00:08:11,680 --> 00:08:14,240 Speaker 1: and the leading politicians are not in the first role. 127 00:08:14,600 --> 00:08:17,760 Speaker 1: But any one of us said and I do the 128 00:08:17,800 --> 00:08:22,080 Speaker 1: same that when we are at the stage where we 129 00:08:22,160 --> 00:08:25,160 Speaker 1: will be fascinated, have the chance to get the vest scene, 130 00:08:25,240 --> 00:08:28,200 Speaker 1: we will take it. And I will take the one 131 00:08:28,320 --> 00:08:30,680 Speaker 1: which is offered to me, and I will not choose 132 00:08:30,720 --> 00:08:33,280 Speaker 1: one of the different ones, because there are a lot 133 00:08:33,280 --> 00:08:37,360 Speaker 1: of very successful the scenes on the Marketisa, thanks for 134 00:08:37,480 --> 00:08:39,920 Speaker 1: time today. We appreciate an important conversation on some really 135 00:08:39,920 --> 00:08:42,080 Speaker 1: difficult issues. So thank you for your understanding. The German 136 00:08:42,120 --> 00:08:52,320 Speaker 1: finance minister, there all have shelves right now, John, this 137 00:08:52,440 --> 00:08:55,600 Speaker 1: is a joy, joy joy. The answer is we only 138 00:08:55,640 --> 00:08:58,959 Speaker 1: have David Blanchelow of Dartmouth and after Cardiff football wins 139 00:08:59,000 --> 00:09:01,600 Speaker 1: turn in a row. They haven't lost in ten games, 140 00:09:01,600 --> 00:09:06,120 Speaker 1: which is absolutely extraordinary. So Professor blanch Blanche Flowers people 141 00:09:06,400 --> 00:09:09,040 Speaker 1: have allowed him to come on air. He is definitive 142 00:09:09,200 --> 00:09:12,120 Speaker 1: on the job economy, from the wage curve of decades 143 00:09:12,160 --> 00:09:16,360 Speaker 1: ago to not working, where have all the good jobs gone? 144 00:09:16,800 --> 00:09:19,760 Speaker 1: Danny Blanche Flower to the right and the left owns 145 00:09:19,760 --> 00:09:23,000 Speaker 1: a high ground. He joins us now from Dartmouth College, Hanover, 146 00:09:23,040 --> 00:09:26,640 Speaker 1: New Hampshire. Danny, you have a chapter in Not Working 147 00:09:26,640 --> 00:09:29,040 Speaker 1: where you say where is the wage growth or the 148 00:09:29,120 --> 00:09:33,360 Speaker 1: lack of it? With the government induced inflation, we're going 149 00:09:33,400 --> 00:09:37,200 Speaker 1: to see, well that give us a legitimate wage growth 150 00:09:37,280 --> 00:09:40,720 Speaker 1: in the good feeling from it? Well in a while. 151 00:09:41,559 --> 00:09:44,920 Speaker 1: Obviously the big reality was the wage growth was very weak. 152 00:09:45,000 --> 00:09:48,720 Speaker 1: The Fed really didn't interpret it correctly, didn't have an 153 00:09:48,720 --> 00:09:52,160 Speaker 1: explanation for it. A big story going for it will 154 00:09:52,200 --> 00:09:54,600 Speaker 1: be what happens to wage growth. But we have a 155 00:09:54,640 --> 00:09:59,520 Speaker 1: puzzle right now because during the doing two thousand twenty 156 00:09:59,520 --> 00:10:02,920 Speaker 1: and coming in to two one, wage growth has jumped. 157 00:10:03,040 --> 00:10:05,320 Speaker 1: It's jumped to about seven or eight percent, but not 158 00:10:05,440 --> 00:10:09,920 Speaker 1: credible because that's because the dropping of the lower end 159 00:10:09,960 --> 00:10:11,600 Speaker 1: of the labor market to be like so it's just 160 00:10:11,640 --> 00:10:15,000 Speaker 1: a batting average effect. So watching wages is going to 161 00:10:15,080 --> 00:10:18,000 Speaker 1: be really important. Measuring it's going to be very hard, 162 00:10:18,360 --> 00:10:21,040 Speaker 1: but in some sense that I think, yeah, you're right 163 00:10:21,080 --> 00:10:22,559 Speaker 1: you said a minute ago, look at g d P. 164 00:10:23,200 --> 00:10:25,280 Speaker 1: But I think the big deal will be look at 165 00:10:25,280 --> 00:10:28,559 Speaker 1: wage growth, look at what happens um and see if 166 00:10:28,559 --> 00:10:31,199 Speaker 1: it sustains itself in a way that it that it hasn't. 167 00:10:31,320 --> 00:10:34,920 Speaker 1: And and then the major reason in a sense for 168 00:10:34,960 --> 00:10:37,640 Speaker 1: that is the people at the lower end have got 169 00:10:37,679 --> 00:10:40,199 Speaker 1: to be lifted. They've been impacted hard by the pandemic. 170 00:10:40,520 --> 00:10:43,360 Speaker 1: They didn't see really strong wage growth in the last 171 00:10:43,360 --> 00:10:46,320 Speaker 1: decade or so. So I think wages, they're really central 172 00:10:46,360 --> 00:10:49,880 Speaker 1: toward this. Within wages being central to it, it is 173 00:10:49,920 --> 00:10:53,320 Speaker 1: about jump start in the economy. What is the character 174 00:10:53,480 --> 00:10:56,559 Speaker 1: of six or seven percent g d P. What kind 175 00:10:56,600 --> 00:11:01,040 Speaker 1: of economy will that be? Well, it'll be it'll be 176 00:11:01,080 --> 00:11:04,280 Speaker 1: a pretty good economy. I mean, we have we have 177 00:11:04,360 --> 00:11:08,000 Speaker 1: to put all of this in context, Jenny. Is it 178 00:11:08,080 --> 00:11:14,920 Speaker 1: an economy for the elites the bottom line? That's exactly 179 00:11:14,960 --> 00:11:18,000 Speaker 1: the concern. I mean, the K shaped recovery, strong recovery 180 00:11:18,040 --> 00:11:21,720 Speaker 1: for some, no recovery for others. And I think that's 181 00:11:21,840 --> 00:11:23,680 Speaker 1: really the concern. I mean. The great thing in a 182 00:11:23,760 --> 00:11:26,720 Speaker 1: sense of that Biden and stuff is he's focused on it. 183 00:11:26,800 --> 00:11:29,840 Speaker 1: He has two really strong appointees in Treasury and at 184 00:11:29,840 --> 00:11:32,640 Speaker 1: the Council, Janet Yelling and cc Rousse, who said in 185 00:11:32,679 --> 00:11:35,440 Speaker 1: the in their nomination speeches, this is what we're going 186 00:11:35,480 --> 00:11:39,080 Speaker 1: to focus on. But the reality of that is it's 187 00:11:39,160 --> 00:11:43,360 Speaker 1: really hard. It's really hard to bring everybody along together. 188 00:11:43,400 --> 00:11:45,640 Speaker 1: And look at look at the stock market. We've looked, 189 00:11:45,720 --> 00:11:48,840 Speaker 1: we've seen that that's doing pretty well. Wall streets doing fine, 190 00:11:48,880 --> 00:11:51,000 Speaker 1: You've been talking about it. But the issue in some 191 00:11:51,120 --> 00:11:54,080 Speaker 1: sets around the world is what happens to main street? 192 00:11:54,480 --> 00:11:56,760 Speaker 1: And because main street has not done that well, this is, 193 00:11:56,800 --> 00:11:59,839 Speaker 1: in a sense of the explanation of populism. It's the 194 00:12:00,000 --> 00:12:02,240 Speaker 1: explormation in the US of a of a push to 195 00:12:02,320 --> 00:12:05,559 Speaker 1: Trump is an explanation in the UK pushed to Brexit. 196 00:12:05,800 --> 00:12:08,960 Speaker 1: So this is central to what happens in this recovery. 197 00:12:09,160 --> 00:12:12,120 Speaker 1: Do you bring everybody along in the UK? Does the 198 00:12:12,120 --> 00:12:15,560 Speaker 1: British Prime Minister? Is he able to do things for 199 00:12:15,600 --> 00:12:18,800 Speaker 1: the fifty constituencies that used to be labor that went 200 00:12:18,880 --> 00:12:21,240 Speaker 1: to him to vote for Brexit. You've got to deliver 201 00:12:21,720 --> 00:12:23,440 Speaker 1: and the question is are you going to be able to? 202 00:12:23,720 --> 00:12:25,719 Speaker 1: I mean, the question is what is power going to 203 00:12:25,840 --> 00:12:28,400 Speaker 1: say about those people who are who are at the 204 00:12:28,400 --> 00:12:31,679 Speaker 1: lower who've been furloughed and potentially their firms won't what 205 00:12:31,720 --> 00:12:35,360 Speaker 1: won't kick started again? Danny, There's a lot there. Let's 206 00:12:35,400 --> 00:12:38,040 Speaker 1: unpack a little bit of it this idea of you know, 207 00:12:38,120 --> 00:12:40,360 Speaker 1: people come on this show and they say that the 208 00:12:40,400 --> 00:12:43,040 Speaker 1: markets outperformed and did really well even though main Street 209 00:12:43,080 --> 00:12:45,960 Speaker 1: lagged behind for a long time. Now we're entering a 210 00:12:46,000 --> 00:12:48,960 Speaker 1: new paradigm where main Street can perhaps do better and 211 00:12:49,040 --> 00:12:53,000 Speaker 1: the and markets may perhaps underperform a bit. Are you 212 00:12:53,080 --> 00:12:56,080 Speaker 1: saying that's hogwash, that that's not true and that's not 213 00:12:56,120 --> 00:12:59,120 Speaker 1: the trajectory that we're on. Well, I mean, I see that. 214 00:12:59,720 --> 00:13:02,600 Speaker 1: The central part of what we're seeing is that the 215 00:13:02,640 --> 00:13:04,440 Speaker 1: Fed is going to do in the bank of eing them. 216 00:13:04,480 --> 00:13:06,920 Speaker 1: They're going to do quantitative easing. They're going to keep 217 00:13:06,960 --> 00:13:09,840 Speaker 1: doing that. That's going to push our asset prices. The 218 00:13:09,920 --> 00:13:13,400 Speaker 1: question then is how does that quantitative easing, How does 219 00:13:13,480 --> 00:13:15,839 Speaker 1: that help people at the lower end. The answer is 220 00:13:15,960 --> 00:13:19,520 Speaker 1: relatively so, it doesn't. So the focus on the Biden 221 00:13:19,600 --> 00:13:23,719 Speaker 1: package is actually about jobs, helping people at the lower end, 222 00:13:24,040 --> 00:13:28,360 Speaker 1: and restoring employment to those who are furlowed, those who 223 00:13:28,400 --> 00:13:31,280 Speaker 1: have been taking these unemployment betters. I should just go back. 224 00:13:31,760 --> 00:13:34,480 Speaker 1: So when the unemployment rate rises, we have never as 225 00:13:34,520 --> 00:13:39,319 Speaker 1: of last April, we have met to we have never 226 00:13:39,360 --> 00:13:43,439 Speaker 1: seen wage growth rise dramatically. So why is that the 227 00:13:43,440 --> 00:13:47,560 Speaker 1: bottom ten percent or so of the wage distribution dropped out. 228 00:13:47,840 --> 00:13:51,760 Speaker 1: They're not working, they're furloughed. And the question is if 229 00:13:52,000 --> 00:13:55,199 Speaker 1: are the firms that are furloughed actually going to reopen? 230 00:13:55,440 --> 00:13:58,240 Speaker 1: And if they're not, we're in really big trouble. The 231 00:13:58,240 --> 00:14:01,760 Speaker 1: government's going to have to do something about that, um 232 00:14:01,800 --> 00:14:04,400 Speaker 1: and we know that we've never seen anything quite like that. 233 00:14:05,120 --> 00:14:07,240 Speaker 1: The reality is that this is a big problem. I 234 00:14:07,320 --> 00:14:08,959 Speaker 1: gotta jump in, sir, and we've gotta go back to 235 00:14:08,960 --> 00:14:10,319 Speaker 1: your time in the Bank of England. You're at the 236 00:14:10,320 --> 00:14:12,640 Speaker 1: Bank of England at that really crucial time oh six 237 00:14:12,679 --> 00:14:14,719 Speaker 1: o nine, right before the crisis, coming out of the 238 00:14:14,760 --> 00:14:17,280 Speaker 1: crisis as well, when you sat there with Governor King, 239 00:14:17,280 --> 00:14:18,880 Speaker 1: did you tell him you don't like the idea of 240 00:14:18,960 --> 00:14:21,720 Speaker 1: QUI because you thought this would happen. Was it anticipated 241 00:14:22,000 --> 00:14:24,280 Speaker 1: at the time when this grand experiment really got going. 242 00:14:25,440 --> 00:14:28,720 Speaker 1: Absolutely not. I mean, I think the reality was that 243 00:14:28,760 --> 00:14:34,080 Speaker 1: this central banks were basically unprepared, unprepared for having to 244 00:14:34,280 --> 00:14:36,920 Speaker 1: do this. But I think the biggest thing, John was 245 00:14:37,000 --> 00:14:40,680 Speaker 1: that two things. Nobody really had a clue about the 246 00:14:40,720 --> 00:14:44,160 Speaker 1: transmission mechanism and how it was going to work. And 247 00:14:44,200 --> 00:14:46,880 Speaker 1: nobody had a clue how about this thing would ever end? 248 00:14:47,320 --> 00:14:51,080 Speaker 1: And of course it hasn't ended and it continues. So 249 00:14:51,160 --> 00:14:54,080 Speaker 1: I think the answer is no. I mean that's the 250 00:14:54,120 --> 00:14:55,800 Speaker 1: other part of it is think of the debate going 251 00:14:55,840 --> 00:14:58,120 Speaker 1: on at the Bank of England. The committee is now 252 00:14:58,240 --> 00:15:01,240 Speaker 1: arguing in public about whether they think they should go 253 00:15:01,280 --> 00:15:04,320 Speaker 1: to negative rates. I mean I remember being told then 254 00:15:04,880 --> 00:15:07,160 Speaker 1: that half a percent was the lower bound. You couldn't 255 00:15:07,200 --> 00:15:09,600 Speaker 1: go lower than a half. So the answer is this 256 00:15:09,680 --> 00:15:13,520 Speaker 1: is this is an unheard of territory John. You know 257 00:15:13,800 --> 00:15:17,240 Speaker 1: we will see, um what what what assets? Will they 258 00:15:17,280 --> 00:15:20,280 Speaker 1: continue to buy? What will the Bank of England do? 259 00:15:20,720 --> 00:15:22,680 Speaker 1: Will the US go to negative rates? I mean, I 260 00:15:22,720 --> 00:15:26,120 Speaker 1: think pals made all the right noises, but the question 261 00:15:26,240 --> 00:15:30,640 Speaker 1: is do they have any ability really to impact them? 262 00:15:30,760 --> 00:15:34,440 Speaker 1: And does a hundred billion of QUEI today are its 263 00:15:34,480 --> 00:15:36,760 Speaker 1: effects the same as it was in two thousand monements? 264 00:15:37,200 --> 00:15:39,480 Speaker 1: How do we have a proper conversation about this? Because 265 00:15:39,520 --> 00:15:41,200 Speaker 1: I know from sources that when you were at the 266 00:15:41,200 --> 00:15:43,560 Speaker 1: Bank of England, Governor King told you guys not to 267 00:15:43,560 --> 00:15:45,840 Speaker 1: go out there and say quie won't work. Once you 268 00:15:45,960 --> 00:15:47,640 Speaker 1: decided to do it, that was it. You all had 269 00:15:47,680 --> 00:15:49,080 Speaker 1: to get on the same page. You don't have to 270 00:15:49,080 --> 00:15:50,680 Speaker 1: tell me right now on the record whether that was 271 00:15:50,720 --> 00:15:52,640 Speaker 1: true or not, because I know from talking to people 272 00:15:52,920 --> 00:15:55,000 Speaker 1: it happened. So Danny, when are we going to have 273 00:15:55,000 --> 00:15:57,680 Speaker 1: a proper conversation about whether this works or not and 274 00:15:57,720 --> 00:15:59,720 Speaker 1: not be dictated by just a couple of people who 275 00:15:59,720 --> 00:16:04,560 Speaker 1: have made some big decisions. Oh, I think the answer 276 00:16:04,680 --> 00:16:08,920 Speaker 1: was a thing. Eventually, by around November two thousand and eight, 277 00:16:09,240 --> 00:16:13,080 Speaker 1: it was clear that you couldn't cut rates enough and 278 00:16:13,160 --> 00:16:15,200 Speaker 1: that you had You know, you can't cut the price 279 00:16:15,240 --> 00:16:18,400 Speaker 1: that cut the price of money, so you raise the quantity. 280 00:16:18,760 --> 00:16:20,840 Speaker 1: I think it's go back to your earlier question. I 281 00:16:20,840 --> 00:16:24,240 Speaker 1: mean the answer is it's unclear what QUI has done. 282 00:16:24,320 --> 00:16:26,520 Speaker 1: I mean, I think what you just asked me, what 283 00:16:26,600 --> 00:16:29,320 Speaker 1: has QUI done? But it has to be in combination 284 00:16:29,840 --> 00:16:34,640 Speaker 1: with zero or zero or someplaces negative rates, and so 285 00:16:34,920 --> 00:16:38,240 Speaker 1: the attempts to work out what it's done are difficult. 286 00:16:38,280 --> 00:16:41,040 Speaker 1: I mean, I take the view actually is that if 287 00:16:41,040 --> 00:16:45,880 Speaker 1: we haven't done it, unemployment rates would have been That's 288 00:16:45,920 --> 00:16:49,080 Speaker 1: the Blancie line. So I think certainly in two thousand 289 00:16:49,200 --> 00:16:54,000 Speaker 1: eight nine it worked, probably diminishing return set in, but 290 00:16:54,080 --> 00:16:56,560 Speaker 1: it certainly seems to me to have had positive effects 291 00:16:56,560 --> 00:16:59,320 Speaker 1: on stock markets. Why else is the stock market rising 292 00:16:59,320 --> 00:17:02,920 Speaker 1: because there's this buyer of assets that's out there. So 293 00:17:03,000 --> 00:17:05,760 Speaker 1: I agree with you, um, and we're I'm looking back. 294 00:17:06,520 --> 00:17:09,040 Speaker 1: Basically we had no idea what to buy, to think, 295 00:17:09,080 --> 00:17:12,240 Speaker 1: do you buy ten years fifteen five? So the Bank 296 00:17:12,320 --> 00:17:15,680 Speaker 1: of England bought pretty pretty long stuff that didn't mature 297 00:17:15,760 --> 00:17:19,040 Speaker 1: very quickly. Um. So it's not just what it q do, 298 00:17:19,160 --> 00:17:21,680 Speaker 1: but what should you buy? What are its impact? What 299 00:17:21,760 --> 00:17:24,320 Speaker 1: you know? What duration stuff do you buy? So all 300 00:17:24,359 --> 00:17:26,879 Speaker 1: of that's still in the air, and the answer is 301 00:17:26,920 --> 00:17:29,439 Speaker 1: that when you're floundering, you have to do everything. So 302 00:17:29,520 --> 00:17:31,760 Speaker 1: I think and Powell has been cautious, and I I don't 303 00:17:31,760 --> 00:17:34,920 Speaker 1: think sensible, more sensible and cautious than people at the 304 00:17:34,920 --> 00:17:36,840 Speaker 1: Bank of eng and how they instid inflation is going 305 00:17:36,880 --> 00:17:39,160 Speaker 1: to take off based on no evidence. So I think 306 00:17:39,280 --> 00:17:41,480 Speaker 1: you know the story out of the Fed looking back 307 00:17:41,520 --> 00:17:44,640 Speaker 1: saying they've got it. They got got two eighteen rong, 308 00:17:44,760 --> 00:17:47,200 Speaker 1: which I said on your program, I think every month 309 00:17:47,280 --> 00:17:50,040 Speaker 1: for three and a half years. So so I'm hopeful, 310 00:17:50,200 --> 00:17:52,159 Speaker 1: but these are tough time, Danny. Good to see you, 311 00:17:52,240 --> 00:17:55,760 Speaker 1: always good to catch up. Downmouth Carlige, Professor of Economics, 312 00:18:01,880 --> 00:18:05,119 Speaker 1: let's get this back on track, Chrisma Rank your Belly 313 00:18:05,119 --> 00:18:08,520 Speaker 1: Funds co Chief investment of Chris. We're not going to 314 00:18:08,600 --> 00:18:11,080 Speaker 1: do London Derbys and all of that stuff. Let's talk 315 00:18:11,119 --> 00:18:13,840 Speaker 1: about the markets. Do I position for better growth? Do 316 00:18:13,880 --> 00:18:16,680 Speaker 1: I position for higher inflation? And what's the difference between 317 00:18:16,680 --> 00:18:20,200 Speaker 1: the two? Yeah, I think your position for both. Listen, 318 00:18:20,359 --> 00:18:23,480 Speaker 1: Goldilocks died probably a year ago. UM. The era of 319 00:18:23,760 --> 00:18:27,680 Speaker 1: low inflation and low rates UH and good growth is 320 00:18:27,880 --> 00:18:31,760 Speaker 1: probably over, and you know were it might be likely 321 00:18:31,800 --> 00:18:35,240 Speaker 1: to see much higher inflation going forward. The question is 322 00:18:35,280 --> 00:18:38,760 Speaker 1: how much why are we getting inflation? Is a good inflation? 323 00:18:38,840 --> 00:18:41,080 Speaker 1: Meaning is it because everybody wants to go on vacation 324 00:18:41,119 --> 00:18:43,560 Speaker 1: in August? Or is it because OPEC is squeezing us? 325 00:18:43,800 --> 00:18:45,679 Speaker 1: And is it structural? Um? And you know, those are 326 00:18:45,680 --> 00:18:48,280 Speaker 1: all questions we think about. UM. The market obviously is 327 00:18:48,320 --> 00:18:51,040 Speaker 1: it's very focused on the interplay between rates and inflation, 328 00:18:51,520 --> 00:18:55,200 Speaker 1: and that has fed the rotation into value stacks, which 329 00:18:55,920 --> 00:18:58,320 Speaker 1: has started, you know, six months ago and has benefited 330 00:18:58,359 --> 00:19:01,240 Speaker 1: people like us. Chris. We have a conversation with the 331 00:19:01,320 --> 00:19:03,959 Speaker 1: leadership of x on today here at Bloomberg. Give us 332 00:19:04,000 --> 00:19:07,439 Speaker 1: your update on hydro carbon's Gabelle is is ancient for 333 00:19:07,560 --> 00:19:11,600 Speaker 1: a love of industrial companies where Mario was ween your thoughts, 334 00:19:11,640 --> 00:19:14,959 Speaker 1: I'm big oil. Yeah, so listen. One of the one 335 00:19:14,960 --> 00:19:17,160 Speaker 1: of the big themes coming out of this earning season 336 00:19:17,200 --> 00:19:20,560 Speaker 1: has been E s G Environmental social governance. Everybody's talking 337 00:19:20,600 --> 00:19:22,840 Speaker 1: about it, everybody's gonna write about it in their annual 338 00:19:22,840 --> 00:19:25,719 Speaker 1: report um. And the irony, of course is that over 339 00:19:25,800 --> 00:19:28,480 Speaker 1: the last several months it's been these big dirty companies 340 00:19:28,760 --> 00:19:31,840 Speaker 1: like Excellent who who have done much better. Again, longer term, 341 00:19:31,920 --> 00:19:34,360 Speaker 1: we'll see how that plays out. We actually just launched 342 00:19:34,680 --> 00:19:37,479 Speaker 1: a sustainability fund, our first sustainability fund called Love Our 343 00:19:37,560 --> 00:19:41,040 Speaker 1: Planet and People. It's our first ETF, and you know, 344 00:19:41,080 --> 00:19:43,360 Speaker 1: we we think there's a bright future for companies who 345 00:19:43,359 --> 00:19:47,480 Speaker 1: are trying to uh go green, and particularly big industrial 346 00:19:47,480 --> 00:19:49,680 Speaker 1: companies that are trying to pivot to green. And you've 347 00:19:49,680 --> 00:19:52,720 Speaker 1: seen that with GM and data and air products and 348 00:19:52,760 --> 00:19:56,520 Speaker 1: to a certain extent Excen, who's interestingly focused on carbon 349 00:19:56,600 --> 00:19:58,760 Speaker 1: capture and sequestration as opposed to some of the other 350 00:19:58,800 --> 00:20:01,399 Speaker 1: things that the other in gradets are focused on. Chris, 351 00:20:01,480 --> 00:20:02,800 Speaker 1: I want to go back to something that you said, 352 00:20:03,000 --> 00:20:05,879 Speaker 1: Goldilocks died a year ago. And this speaks to the 353 00:20:06,040 --> 00:20:07,960 Speaker 1: it's not too hot, not too cold, not to the 354 00:20:08,080 --> 00:20:10,960 Speaker 1: very character Well, I mean, honestly, see how it could 355 00:20:10,960 --> 00:20:13,560 Speaker 1: get pretty morbid. I am curious though, going forward what 356 00:20:13,600 --> 00:20:17,120 Speaker 1: that means. Who loses? Because in everything is perfect kind 357 00:20:17,119 --> 00:20:18,880 Speaker 1: of world with nothing is too hot and too cold, 358 00:20:18,920 --> 00:20:21,120 Speaker 1: everything can kind of rise. At the same time, who 359 00:20:21,200 --> 00:20:24,880 Speaker 1: suffers when Goldilocks dies? Yeah, well, I think you're seeing 360 00:20:24,880 --> 00:20:27,000 Speaker 1: it in what's happening with the nastac. You know, this 361 00:20:27,080 --> 00:20:30,359 Speaker 1: is a perfect environment for the big growth companies, um, 362 00:20:30,560 --> 00:20:32,720 Speaker 1: big internet companies in particular that I don't have to 363 00:20:32,720 --> 00:20:37,200 Speaker 1: show profits in the near term um and whose profits 364 00:20:37,200 --> 00:20:39,600 Speaker 1: in the future are being discounted at very low rates 365 00:20:39,640 --> 00:20:41,760 Speaker 1: but by the market. So I think there's going to 366 00:20:41,840 --> 00:20:44,760 Speaker 1: be more of an impetus to to be profitable, to 367 00:20:44,960 --> 00:20:48,600 Speaker 1: have rational economic models, and that you know, should favor 368 00:20:48,680 --> 00:20:52,879 Speaker 1: the traditional incumbent companies, which now include probably many of 369 00:20:52,880 --> 00:20:55,320 Speaker 1: the thing which are you know, enormously profitable and have 370 00:20:55,440 --> 00:20:57,520 Speaker 1: very strong market positions. Much a bit of child and 371 00:20:57,560 --> 00:21:00,480 Speaker 1: shooting into this show this morning. See the founder of 372 00:21:00,480 --> 00:21:02,920 Speaker 1: the bomber. That's great. What is this you accidentally put 373 00:21:02,920 --> 00:21:06,720 Speaker 1: on Bloomberg? It's gonna Nurst the children because they're in tears, Like, so, 374 00:21:06,800 --> 00:21:09,680 Speaker 1: what is this Chris las guess serious on So honestly, 375 00:21:09,720 --> 00:21:11,920 Speaker 1: this is something that people have been talking about. Yes, look, 376 00:21:11,920 --> 00:21:13,920 Speaker 1: we don't want to talk about Goldilocks. But at the 377 00:21:13,960 --> 00:21:16,720 Speaker 1: same time, not too hot, not too cold is a question? 378 00:21:16,880 --> 00:21:18,840 Speaker 1: Is at dead? I mean you'd say these are some 379 00:21:18,880 --> 00:21:21,680 Speaker 1: of the key questions and investing all of that good stuff, Chris, 380 00:21:21,840 --> 00:21:24,320 Speaker 1: active management. Now do you think you've got a stronger 381 00:21:24,400 --> 00:21:27,879 Speaker 1: argument for that this year? I think we do. Um. 382 00:21:27,920 --> 00:21:30,600 Speaker 1: You know, I'm reminded we're talking about commodities. The cure 383 00:21:30,640 --> 00:21:33,119 Speaker 1: for high prices is more high prices in the case 384 00:21:33,280 --> 00:21:35,840 Speaker 1: of passive the cure for passive in the eyes of 385 00:21:35,960 --> 00:21:38,680 Speaker 1: active managers is more passive. Um. You know, we've seen 386 00:21:39,040 --> 00:21:42,480 Speaker 1: you know, mindless flows driving the market over the last 387 00:21:42,800 --> 00:21:45,199 Speaker 1: ten years or more. Uh. And to the extent that 388 00:21:45,840 --> 00:21:49,520 Speaker 1: we can do price discovery and add alpha that benefits us, 389 00:21:50,040 --> 00:21:51,560 Speaker 1: I think now is the time to do it, because 390 00:21:51,640 --> 00:21:54,720 Speaker 1: the playing field is changed Goldilocks. If Goldilocks is in 391 00:21:54,800 --> 00:21:56,919 Speaker 1: fact dead, that everybody's gonna go up. We're in the 392 00:21:57,040 --> 00:22:00,160 Speaker 1: three or four accounting statements. Is the alpha general water 393 00:22:00,240 --> 00:22:02,920 Speaker 1: or is it even dies? It distinctions of cash flow. 394 00:22:03,240 --> 00:22:06,640 Speaker 1: What's the line that matters to the Gabelle shop. It's 395 00:22:06,640 --> 00:22:09,000 Speaker 1: clearly the cashalist statement. You know, cash is king. It 396 00:22:09,040 --> 00:22:12,280 Speaker 1: always has been. Um, it's not about a revenue multiple. 397 00:22:12,720 --> 00:22:17,400 Speaker 1: And so that's why we're looking. Chris always got to say, 398 00:22:17,480 --> 00:22:20,359 Speaker 1: Sir christmin Rank, give out a fund Colley, Chief Investment Officer, 399 00:22:20,440 --> 00:22:28,840 Speaker 1: thank you. What we've tried to do now, pushing on 400 00:22:28,960 --> 00:22:32,919 Speaker 1: a year and evermore, is the medicine of this pandemic. 401 00:22:33,280 --> 00:22:36,840 Speaker 1: Giving us original leadership in February of last year was 402 00:22:36,880 --> 00:22:39,600 Speaker 1: Peter Hotez. He's dean of the National School of Tropical 403 00:22:39,640 --> 00:22:43,439 Speaker 1: Medicine at the Baylor College of Medicine. He has been ubiquitous. 404 00:22:43,680 --> 00:22:46,880 Speaker 1: I would suggest, you know, it's almost like Dr Fauci. Peter, 405 00:22:47,040 --> 00:22:51,320 Speaker 1: you have been everywhere giving us wisdom on the vaccine. 406 00:22:51,800 --> 00:22:57,199 Speaker 1: Have you spoken to the governor of your Texas I've not. 407 00:22:57,359 --> 00:23:00,320 Speaker 1: I've not had the opportunity to speak with the governor 408 00:23:00,440 --> 00:23:03,080 Speaker 1: or his staff. Of course, I'd always welcome that opportunity, 409 00:23:03,160 --> 00:23:05,720 Speaker 1: and I have in the past, but not not over 410 00:23:05,760 --> 00:23:09,280 Speaker 1: this latest issue. If well, over the latest issue, it's important. 411 00:23:09,280 --> 00:23:12,359 Speaker 1: I'm hearing anecdotally of people just literally trying to leave 412 00:23:12,400 --> 00:23:15,240 Speaker 1: the state. They're so furious about this. And yes there's 413 00:23:15,280 --> 00:23:17,880 Speaker 1: people in support of the governor. What would be your 414 00:23:17,920 --> 00:23:21,800 Speaker 1: counsel to the governor right now of the differential equations 415 00:23:21,840 --> 00:23:30,760 Speaker 1: of more vaccinations, better vaccinations, better statistics against his political philosophy. Well, 416 00:23:30,800 --> 00:23:34,600 Speaker 1: there are two reasons not to dial back masks and 417 00:23:34,680 --> 00:23:37,840 Speaker 1: social distancing at this point. One is we've got this 418 00:23:38,040 --> 00:23:41,480 Speaker 1: terrible United Kingdom variant as some people call it. I 419 00:23:41,520 --> 00:23:43,640 Speaker 1: call it the B one one seven variant that first 420 00:23:43,640 --> 00:23:47,280 Speaker 1: a rose out of southern England in September, and now 421 00:23:47,359 --> 00:23:49,879 Speaker 1: the data showing it's much more aggressive in terms of 422 00:23:49,920 --> 00:23:54,360 Speaker 1: its ability to be transmitted. And also now the UK government, 423 00:23:54,359 --> 00:23:57,120 Speaker 1: although the second part is not being peer reviewed, if 424 00:23:57,240 --> 00:23:59,360 Speaker 1: the UK government's put it up on their website, looks 425 00:23:59,400 --> 00:24:01,919 Speaker 1: pretty compelled that the death rates higher. So this is 426 00:24:01,960 --> 00:24:05,480 Speaker 1: a bad actor and it's racing through the country at 427 00:24:05,520 --> 00:24:09,000 Speaker 1: a high rate, really really bad. In Florida right now, 428 00:24:09,040 --> 00:24:12,720 Speaker 1: maybe ten of the isolates virus isolates are this B 429 00:24:12,840 --> 00:24:17,760 Speaker 1: one one seven variant from the UK. And so that's 430 00:24:17,760 --> 00:24:20,080 Speaker 1: so we can even know the number of cass been 431 00:24:20,080 --> 00:24:23,120 Speaker 1: going down pretty steadily, it's not plateaued. And now many 432 00:24:23,160 --> 00:24:25,160 Speaker 1: of us think that's going to start going back up 433 00:24:25,240 --> 00:24:28,800 Speaker 1: to be a fourth wave. That's issue one. And then second, Um, 434 00:24:28,840 --> 00:24:31,480 Speaker 1: you know, vaccines are not here yet. Um. Now that's 435 00:24:31,520 --> 00:24:35,760 Speaker 1: been disappointing. Operation Warp speed promised vaccines upon emergency use 436 00:24:35,800 --> 00:24:39,160 Speaker 1: authorization for the J and J vaccine that's not delivering. Um, 437 00:24:39,200 --> 00:24:42,119 Speaker 1: they will come. The President two days ago committed to 438 00:24:42,160 --> 00:24:46,200 Speaker 1: having every American wants to be vaccinated. Can't be vaccinated 439 00:24:46,280 --> 00:24:49,879 Speaker 1: by late spring, early summer. So that's good news. So 440 00:24:50,000 --> 00:24:53,040 Speaker 1: hold off, you know, don't don't dial back the masks 441 00:24:53,080 --> 00:24:55,840 Speaker 1: and social distancing right now. This is the very worst 442 00:24:55,840 --> 00:24:58,760 Speaker 1: time to do it. Dr Hotez, This may be premature, 443 00:24:58,920 --> 00:25:01,240 Speaker 1: but looking forward, based on where we are in the 444 00:25:01,280 --> 00:25:05,000 Speaker 1: inoculation schedule as well as a technology that's been discovered 445 00:25:05,000 --> 00:25:08,440 Speaker 1: through this process, are we closer to the next pandemic 446 00:25:08,640 --> 00:25:12,639 Speaker 1: or further away? Well, I think we're we're closer to 447 00:25:12,720 --> 00:25:15,640 Speaker 1: vaccinating our way out of this current one. And and 448 00:25:15,680 --> 00:25:18,160 Speaker 1: I say that because there's some exciting news that came 449 00:25:18,160 --> 00:25:21,000 Speaker 1: out of Israel last week published in the New England 450 00:25:21,040 --> 00:25:24,240 Speaker 1: Journal of Medicine. We've known that that that two doses 451 00:25:24,240 --> 00:25:27,680 Speaker 1: of the Visor vaccine and likely the Madarina vaccine as well, 452 00:25:27,760 --> 00:25:31,360 Speaker 1: can uh can stop symptomatic illness and keep you out 453 00:25:31,400 --> 00:25:35,040 Speaker 1: of the hospital or the intensive care unit. Reduction, But 454 00:25:35,119 --> 00:25:40,960 Speaker 1: the data from Israel shows a reduction also an asymptomatic transmission, 455 00:25:41,000 --> 00:25:44,119 Speaker 1: meaning people who become PCR positive. So that's a game changer. 456 00:25:44,160 --> 00:25:47,760 Speaker 1: It means that you can enough people get vaccinated, and 457 00:25:47,800 --> 00:25:50,239 Speaker 1: if the other vaccines have a similar performance, which I 458 00:25:50,240 --> 00:25:53,080 Speaker 1: think they will, it means that we can halt transmission, 459 00:25:53,119 --> 00:25:56,120 Speaker 1: and that means that we can vaccinate our way out 460 00:25:56,119 --> 00:25:58,840 Speaker 1: of this epidemic. In the United States. It means uh, 461 00:25:59,160 --> 00:26:01,360 Speaker 1: get I don't know that things will go completely back 462 00:26:01,359 --> 00:26:04,360 Speaker 1: to normal, but I would have a much more optimistic outlook, 463 00:26:04,400 --> 00:26:07,000 Speaker 1: maybe even mass coming off later in the summer fall. 464 00:26:07,119 --> 00:26:08,840 Speaker 1: So a lot to look forward to it now. It's 465 00:26:08,880 --> 00:26:12,680 Speaker 1: not the time to screw it up by relaxing measures. 466 00:26:12,720 --> 00:26:15,119 Speaker 1: You don't want people losing their lives before all the 467 00:26:15,160 --> 00:26:17,520 Speaker 1: good things to come. And I guess that Dr Hotels 468 00:26:17,640 --> 00:26:21,240 Speaker 1: looking forward to the next pandemic, the post covid era, 469 00:26:21,440 --> 00:26:24,400 Speaker 1: We're still dealing with the different coronavirus is that could 470 00:26:24,400 --> 00:26:27,239 Speaker 1: be out there, and frankly, based on some estimates, it's 471 00:26:27,280 --> 00:26:29,520 Speaker 1: kind of amazing. We haven't had a pandemic like this 472 00:26:29,680 --> 00:26:33,199 Speaker 1: until now. Do we feel prepared to deal with it 473 00:26:33,240 --> 00:26:35,800 Speaker 1: in a better way than we deal dealt with this one, 474 00:26:36,359 --> 00:26:39,560 Speaker 1: which by many accounts really could have been handled a 475 00:26:39,560 --> 00:26:42,640 Speaker 1: lot better. Yeah, you know, with one of the things 476 00:26:42,640 --> 00:26:44,840 Speaker 1: that I always point out that things have gotten better 477 00:26:44,920 --> 00:26:47,760 Speaker 1: with each pandemic, we do learn something. After Stars in 478 00:26:47,760 --> 00:26:51,159 Speaker 1: two thousand three, we put an International Health Regulations i 479 00:26:51,320 --> 00:26:54,000 Speaker 1: h R two thousand five after H one and one 480 00:26:54,080 --> 00:26:57,840 Speaker 1: the Global Health Security Agenda, and stepped up influenza surveillance. 481 00:26:57,960 --> 00:27:05,600 Speaker 1: After after Ebola and Zeke at Davos, to successive Davos meetings, 482 00:27:05,640 --> 00:27:10,399 Speaker 1: the Coalition for Epidemic Preparedness Innovation SEPPI was launched. So 483 00:27:10,440 --> 00:27:13,520 Speaker 1: each time we do learn something, we make incremental advances. 484 00:27:13,880 --> 00:27:16,400 Speaker 1: This one, I think we'll have more far reaching effects 485 00:27:16,400 --> 00:27:19,359 Speaker 1: because of how it's devastated that the economy globally and 486 00:27:19,400 --> 00:27:22,600 Speaker 1: how it's become a global security issue. Dr Hotez, As 487 00:27:22,640 --> 00:27:25,080 Speaker 1: you know, there's always a kink in the smooth curves. 488 00:27:25,119 --> 00:27:28,679 Speaker 1: If you take the wonderful smooth curve of the vaccinations 489 00:27:28,720 --> 00:27:32,600 Speaker 1: success of people like you, it's a curve down through 490 00:27:32,640 --> 00:27:35,359 Speaker 1: the years, where is the kink for you, or we 491 00:27:35,400 --> 00:27:38,120 Speaker 1: can say all clear. Is it it fifty years old? 492 00:27:38,240 --> 00:27:40,359 Speaker 1: Is it forty eight years old? Do you have in 493 00:27:40,400 --> 00:27:43,440 Speaker 1: your head forty two years old? Where is that tipping 494 00:27:43,520 --> 00:27:48,040 Speaker 1: point as we moved to young adults, Well, and there's 495 00:27:48,040 --> 00:27:53,560 Speaker 1: no Well, it's it's really a gradual, uh, gradual, gradual slope. Um. 496 00:27:53,600 --> 00:27:56,200 Speaker 1: But you know, one of the things we've learned also 497 00:27:56,480 --> 00:28:00,920 Speaker 1: is that even younger individuals of comorbid conditions can get 498 00:28:00,960 --> 00:28:04,600 Speaker 1: pretty serious illness. You know. The thing that worries me 499 00:28:04,640 --> 00:28:07,040 Speaker 1: the most, quite quite honestly, is I think the US 500 00:28:07,200 --> 00:28:10,040 Speaker 1: is other than the spring, which is going to be rough. 501 00:28:10,080 --> 00:28:12,080 Speaker 1: I think the US is going to manage its way. 502 00:28:12,119 --> 00:28:15,800 Speaker 1: We'll probably see a third immunization with the Fiser and 503 00:28:15,840 --> 00:28:18,840 Speaker 1: Madarina vaccine, maybe tailored to the variants, maybe a second 504 00:28:18,840 --> 00:28:21,639 Speaker 1: dose of the Johnson and Johnson vaccine. Don't be surprised 505 00:28:22,040 --> 00:28:24,800 Speaker 1: if you see that happening. The thing I'm worried about 506 00:28:24,960 --> 00:28:27,679 Speaker 1: is other parts of the world. Africa is scaring me 507 00:28:27,840 --> 00:28:30,640 Speaker 1: right now because you have that's what's called the South 508 00:28:30,680 --> 00:28:33,560 Speaker 1: African variant to be one three five one. Now it's 509 00:28:33,560 --> 00:28:37,399 Speaker 1: accelerating into Malawi and Mozambique and into Tanzania, and we 510 00:28:37,440 --> 00:28:40,080 Speaker 1: don't have a lot to offer. Those two mRNA vaccines 511 00:28:40,520 --> 00:28:42,920 Speaker 1: are still pretty fussy in their ability to scale up 512 00:28:42,920 --> 00:28:45,800 Speaker 1: production in the freezer chain requirements. I don't think they're 513 00:28:45,800 --> 00:28:48,440 Speaker 1: going to have a big role in helping Africa. The 514 00:28:48,480 --> 00:28:51,840 Speaker 1: astra Zenica vaccine is a good vaccine for the UK variant, 515 00:28:51,880 --> 00:28:54,760 Speaker 1: it looks like it's not working against the South African variant. 516 00:28:55,280 --> 00:28:57,640 Speaker 1: The murk is out, so when you know, go down 517 00:28:57,720 --> 00:28:59,800 Speaker 1: the list. We don't have a lot to offer the 518 00:29:00,000 --> 00:29:03,040 Speaker 1: freaking continent. We're trying to scale up aggressively our recombinant 519 00:29:03,080 --> 00:29:06,840 Speaker 1: protein vaccine, but I'm really worried about the destabilization of 520 00:29:06,880 --> 00:29:08,800 Speaker 1: Africa right now. I told that you have touched on 521 00:29:09,440 --> 00:29:11,400 Speaker 1: the issue I think, and we appreciate your time and 522 00:29:11,480 --> 00:29:13,360 Speaker 1: let's continue the conversation in the ways to come. Dontor 523 00:29:13,360 --> 00:29:15,720 Speaker 1: Peter hot that's that Dan of the National School of 524 00:29:15,760 --> 00:29:19,280 Speaker 1: Tropical Medicine Bailor College of Medicine. This is the Bloomberg 525 00:29:19,320 --> 00:29:23,680 Speaker 1: Surveillance Podcast. Thanks for listening. Join us live weekdays from 526 00:29:23,720 --> 00:29:27,080 Speaker 1: seven to ten am Eastern. I'm Bloomberg Radio and on 527 00:29:27,160 --> 00:29:31,440 Speaker 1: Bloomberg Television each day from six to nine am for 528 00:29:31,720 --> 00:29:36,640 Speaker 1: insight from the best in economics, finance, investment, and international relations. 529 00:29:37,120 --> 00:29:41,760 Speaker 1: And subscribe to the Surveillance podcast on Apple podcast, SoundCloud, 530 00:29:41,920 --> 00:29:45,520 Speaker 1: Bloomberg dot com, and of course, on the terminal. I'm 531 00:29:45,560 --> 00:29:48,240 Speaker 1: Tom Keene, and this is Bloomberg.