Speaker 1: Welcome to the Bloomberg p m L Podcast. I'm pim
Speaker 1: Fox along with my co host Lisa Bramowitz. Each day
Speaker 1: we bring you the most important, noteworthy, and useful interviews
Speaker 1: for you and your money, whether you're at the grocery
Speaker 1: store or the trading floor. Find the Bloomberg p m
Speaker 1: L Podcast on Apple Podcasts, SoundCloud, and Bloomberg dot com.
Speaker 1: We're gonna take a look at the bond market today,
Speaker 1: focus on fixed income, brought to you by Pimco for
Speaker 1: investors who demand more than the markets deliver. All investments
Speaker 1: contain risk and may lose value. Consult your investment professional
Speaker 1: before investing. Today is a great day to have Ira
Speaker 1: Jersey on the show. He is chief US interest rate
Speaker 1: Strategist for Bloomberg Intelligence and Ira, Before we get to
Speaker 1: what you're expecting for the year ahead, what we can
Speaker 1: expect lead tomorrow with the f O m C meeting minutes,
Speaker 1: I want to talk about the action that we're seeing
Speaker 1: in the bond market today. We're seeing a pretty broad
Speaker 1: based sell off that seems to be stemming really from
Speaker 1: the European bond market. What do you make of this?
Speaker 1: How much should people read into this action? It's hard
Speaker 1: to always around holiday periods to read a lot into
Speaker 1: into things because UM, there's people either putting on positions
Speaker 1: or taking off positions that UM to be either risked
Speaker 1: properly for the year ahead. UM. I think it's real.
Speaker 1: I mean it's real in terms of the idea that UM,
Speaker 1: you know, people do think that the UM that yields
Speaker 1: are going to be somewhat higher, that the tax UH
Speaker 1: plan is going to help inflation and growth a little bit,
Speaker 1: and and you know, at the same time, I think
Speaker 1: a lot of people were really worried that, you know,
Speaker 1: the stock market was going to tank, and and people
Speaker 1: going into year end wanted to be a little bit
Speaker 1: long rate risk just as a hedge to some other
Speaker 1: risk your assets. So UM supported, this isn't big surprise.
Speaker 1: I think, you know, we do have some pretty important
Speaker 1: technical levels we're sitting right at for ten year yield,
Speaker 1: So so you know, a move up to past two fifty,
Speaker 1: for example, to two and a half percent would be
Speaker 1: uh potentially mean that we could see last year's highs up,
Speaker 1: but around two six I would you agree that this
Speaker 1: is being driven that today's sell off in US treasuries
Speaker 1: is being driven at least to some degree by what's
Speaker 1: going on in Europe. We had an ECB member, Benoit
Speaker 1: cu Uh say overnight that he thinks that the ECB
Speaker 1: is going to stop buying. They're not gonna extend the
Speaker 1: bond purchase program yet again as they did in October. Yeah.
Speaker 1: I think that's a big part of it. I mean
Speaker 1: that that's been a risk hanging out there. The ECB
Speaker 1: has been a risk hanging out there for a while. UM. Now,
Speaker 1: even after if you go back to last June, about
Speaker 1: six months ago, when Mario Draggy suggested that the bond
Speaker 1: bank program could come to an end, you saw a
Speaker 1: pretty substantial selloff in UH in treasuries. Now, I think
Speaker 1: one of the question is how sustainable will that sell
Speaker 1: off B You know, is this going to be a
Speaker 1: taper tantrum. When DCB recently cut their purchases of of
Speaker 1: bond buying UM from UM down to about thirty billion
Speaker 1: euros a month UM, then you didn't see a huge
Speaker 1: reaction in the in the US bond market. I'd also
Speaker 1: note that that the move today is is in real terms.
Speaker 1: So what's happened is you look at real yield, so
Speaker 1: you look at the tips market, and you see how
Speaker 1: how yields and tips are selling off. It's not inflation
Speaker 1: expectations that have gone up a lot um. It's really
Speaker 1: in real space. So that leads you to believe that
Speaker 1: it's either some form of de risking, whether it's because
Speaker 1: of the ECB or just um UH or or just
Speaker 1: portfolio positioning for the rest of the year. It's something
Speaker 1: other than the expectation that inflation is going to run
Speaker 1: out of control. AIRA help me understand this. If we're
Speaker 1: having a big sell off at the long end, we're
Speaker 1: down now one and seven thirty seconds for a yield
Speaker 1: of two point eight percent. And then I also told
Speaker 1: you that there were demonstrations in the streets of Iran
Speaker 1: and that North Korea is looking as if it at
Speaker 1: least wants a dialogue with South Korea. Why aren't people buying? Yeah, well,
Speaker 1: I think having a dialogue in on the Korean peninsula
Speaker 1: is probably a positive development in terms of reducing geopolitical risk.
Speaker 1: Well but wait, wait, wait, wait wait the same But
Speaker 1: the reason I mentioned that is because that's also being
Speaker 1: voiced in the context of the North Koreans trying to
Speaker 1: drive a wedge between South Korea and the United States. Yeah,
Speaker 1: that's that's fair. Um. You know, I think the treasury
Speaker 1: market in a lot of ways has been very technical recently,
Speaker 1: where um, you know, the reason why yields continued to
Speaker 1: be so low is because of large central bank balance sheets.
Speaker 1: It's because the of the economic situation in the US.
Speaker 1: So I think what you need to change to see
Speaker 1: a large rally in in treasuries would be something like
Speaker 1: a risk off event. And um, so I think in
Speaker 1: many respects, UM, today's move is going to be more
Speaker 1: in line with the idea that the equity market is
Speaker 1: up you have, UM, even though there's there's uh, you know,
Speaker 1: local and regional tensions in some places. To make that
Speaker 1: a globally systemic event and therefore big risk off event
Speaker 1: would take something much larger than what's going on, um
Speaker 1: in the world today. And I think that stuff in
Speaker 1: the Korean Peninsula. You know, there was some volatility when
Speaker 1: some of those headlines first came out, but quite frankly,
Speaker 1: I think a lot of investors are a little bit
Speaker 1: numb to the headlines coming out of the Korean Peninsula
Speaker 1: at this point. Well, I wrote, would you count yourself
Speaker 1: among those who are simply also because you're recommending the
Speaker 1: people in the US go by Japanese bonds, which arguably
Speaker 1: could could be impacted. Well, not so so. I think
Speaker 1: it's more of an interesting uh, it's it's a very
Speaker 1: interesting phenomenon that has has been occurring in the post
Speaker 1: crisis period where you know, a lot of people show
Speaker 1: the difference in yields between the US and either Germany
Speaker 1: or Japan and just say, how could US yields be
Speaker 1: so high? How could corporate bond yields for you know,
Speaker 1: for mid rated corporate bonds be lower than that of
Speaker 1: treasuries and other jurisdictions. But I think you have to
Speaker 1: put that into context of two things. Is one, what's
Speaker 1: the risk free rate within those individual jurisdictions and in
Speaker 1: those currencies. And secondly, if you do all of the
Speaker 1: currency hedging that you need to do, and you and
Speaker 1: you assets swap back Japanese debt into US dollars, what
Speaker 1: you end up what you end up finding is that
Speaker 1: Japanese yields are actually higher after you do all the
Speaker 1: currency hedging that you need to do. So, um, you know,
Speaker 1: it's not something that an individual investor can really take
Speaker 1: advantage of, but large institutional investors do these kinds of
Speaker 1: trades all the time, where they'll buy a Japanese government
Speaker 1: bond or Japanese TA bill and then hedge that back
Speaker 1: into dollars and actually make thirty fifty basis points more
Speaker 1: than the comparable US instrument. And I think that that's
Speaker 1: something that gets missed a lot of times just looking
Speaker 1: at you know, the new Fields being at zero and
Speaker 1: U S Fields being a two and a half percent.
Speaker 1: Thanks very much, Ira Jersey, much appreciated chief US interest
Speaker 1: rates strategist for Bloomberg in intelligence. Right now, let us
Speaker 1: take a look at what we should be focusing on
Speaker 1: in Bruce Biddles joins US now his chief investment strategist
Speaker 1: at BAARED based in Sarasota, Florida, where it is a
Speaker 1: lot warmer than it is here in New York City. Bruce,
Speaker 1: congratulations for picking the right place to be right now. Um,
Speaker 1: so I want to get your sense on what we
Speaker 1: can expect this year, and I want to start with
Speaker 1: your perception of what did you get most wrong? And
Speaker 1: then what are you most confident about coming into Yeah,
Speaker 1: well that's I think what we got most wrong was
Speaker 1: the uh was the strength of the rally. I mean,
Speaker 1: we came into the year believing that UM. The change
Speaker 1: of administration's UM in November of two thousand and sixteen
Speaker 1: was bullish for the market because we had a business
Speaker 1: friendly administration coming into power, and we felt that that
Speaker 1: was going to be Bullishit influence on the markets all year,
Speaker 1: but we didn't expect the SMP five on it or
Speaker 1: the data rally as much as they did. But certainly
Speaker 1: we had the direction correct, A right, if you had
Speaker 1: the direction correct, I wonder if you could just ask
Speaker 1: answer this question about the direction of the tax overhaul
Speaker 1: bill and what that'll do to stocks? Well, will we
Speaker 1: see increased buybacks, increased dividends, Will we see stocks move
Speaker 1: higher because of this repatriation of money? I think the
Speaker 1: tax legislation that passed UM in late December is certainly
Speaker 1: going to help the economy and if that helps the
Speaker 1: account me as expected, UM is certainly going to produce
Speaker 1: stronger top line growth and that should lead to stronger
Speaker 1: profit growth. Now we expect profits to grow about twelve
Speaker 1: or thirteen percent in two thousand and eighteen. Now, historically,
Speaker 1: if profits rise eleven percent every year, the stock market
Speaker 1: typically responds with a very strong upward bias. Now, the
Speaker 1: risk to that environment, or that the strategy would be
Speaker 1: if the economy didn't respond, is expected. But I believe
Speaker 1: you'll see a mixture when the money comes back to
Speaker 1: the US. You'll see some stock buy back, some increases
Speaker 1: in dividends, but you'll also see an increase in capital spending.
Speaker 1: And UM that that I believe is going to be
Speaker 1: a very bullish element for the market in two thousand
Speaker 1: and eighteen. So you think that the US stock markets
Speaker 1: are going to do pretty well. Does that mean that
Speaker 1: you're pretty bearish on bonds. No, we're not really bearish
Speaker 1: bonds that we think interest rates are likely to go
Speaker 1: somewhat higher now. UM short race, of course are going up.
Speaker 1: But the yield on the bench bar tenure Treasury note
Speaker 1: finished the year about where it started. You'll think about
Speaker 1: two point four percent. I think it can give up
Speaker 1: to about two point seven seven five percent, perhaps before
Speaker 1: the markets would be negatively impacted, maybe even three percent
Speaker 1: on the tenure. But I don't see the inflationary pressures
Speaker 1: building the way some folks do. Now. Yes, Um, the
Speaker 1: economy now has filled the output gap. That's something to
Speaker 1: watch closely and of course, we're very close to full employment,
Speaker 1: which should we should certainly start to see some wage games.
Speaker 1: But I think this is the very early cycle in inflation,
Speaker 1: and I don't think it's going to rise to the
Speaker 1: levels that that could upset the bondom market or the
Speaker 1: stock market. We think inflation will probably be in the
Speaker 1: area of two point four percent in terms of CPI
Speaker 1: for two thousand and eighteen. Bruce bittals they are a
Speaker 1: way you can describe for us the wall of worry?
Speaker 1: What what is it and why? Maybe you don't believe it,
Speaker 1: but maybe you could describe why do people believe that
Speaker 1: it is an effective analogy? Well, I think the wall
Speaker 1: of worry is certainly um something that helped the stock
Speaker 1: market not only last year but throughout the bullor cycle
Speaker 1: that began in two thousand and nine. I think the
Speaker 1: fact that the Feller Reserve Board was responsible for so
Speaker 1: much of the liquidity that was that was forced into
Speaker 1: the markets made people a little unsettled, and that and
Speaker 1: the markets rallying every time a new quee program was
Speaker 1: announced back in two thousand nine. Back in the eleven
Speaker 1: peg and twelve, I think folks were worried that wants
Speaker 1: to fit. Um pulled back from that policy that the
Speaker 1: markets would will lose that support and collapse. But certainly
Speaker 1: that has not been the case now. I think the
Speaker 1: fact that Trump in the election in two thousand and
Speaker 1: sixth Team was another element. UM. A lot of folks
Speaker 1: felt that he would be disruptive and the markets would
Speaker 1: do poorly, and he asked the rhetoric out of Washington
Speaker 1: all year in two thousand and sevent Team was argumentative,
Speaker 1: but I think that really helped the market. It kept
Speaker 1: people UH from becoming um excessively optimistic. We don't see
Speaker 1: any sign of you four you really, except if you
Speaker 1: look at bitcoins for instance. But in the stock market,
Speaker 1: we don't see it. Now. There's optimism, there's no question,
Speaker 1: but we don't see the type of optimism we saw
Speaker 1: back in two thousand for instance. One everyone was bullish,
Speaker 1: including the FED, on the fact that the business cycle
Speaker 1: would probably be repealed because of the new technology. That's
Speaker 1: that's not the case here. Um. Yes, there's some excitement,
Speaker 1: but if you if you go through the financial journals
Speaker 1: or the weekend, like I did, very very hard to
Speaker 1: find a real bullish case expressed by anyone. Bruce I
Speaker 1: want to go through some of the sector calls that
Speaker 1: you had in your latest note. I thought it was interesting.
Speaker 1: One of the biggest upgrades was consumer discretionary companies that
Speaker 1: you had within the US stock universe, and that's you know,
Speaker 1: including home building and footwear, Caristinos in gaming, and this
Speaker 1: is up from where you had placed this sector as
Speaker 1: far as performance heading into ten. Why do you think
Speaker 1: the consumers discretionary stocks are going to do better this year?
Speaker 1: I think there's two reasons. First of all, Um, the
Speaker 1: retail companies benefit great deal from the tax legislation. They
Speaker 1: typically have paid full boat when it came time for
Speaker 1: to pay their taxes, and I think they'll get a big,
Speaker 1: big break because of the new legislation. The second part
Speaker 1: of that equation is that the consumers also going to
Speaker 1: get a break and they're going to be UM, They're
Speaker 1: gonna find more discretionary income in their pockets in two
Speaker 1: thousand and eighteen. So you have that dual effect for
Speaker 1: consumer discretionary stocks. They'll benefit from the tax legislation themselves,
Speaker 1: that will benefit from the consumer um having more disposable
Speaker 1: income as a result of the new tax package. Bruce Bittles,
Speaker 1: you mentioned bitcoin, and I'd be remiss if I didn't
Speaker 1: get your thoughts on it. Well. Actually, um, I'm an
Speaker 1: agnostic on bitcoin. I'm not sure what it really means.
Speaker 1: A lot of folks believe it's just a bubble that's
Speaker 1: going to burst and going to hurt everything, and I
Speaker 1: don't think that's particularly true. Certainly, this speculation there is
Speaker 1: is exorbitant, something we've never seen before. But nevertheless, it's
Speaker 1: not in any way or shape or fashion the size
Speaker 1: of these speculations we saw back in Internet stocks. So
Speaker 1: even the bitcoin exploded and imploded, I mean, I don't
Speaker 1: think it would affect anything at all. So whether there's
Speaker 1: a future there or not, I have no idea. But
Speaker 1: my guess is that will start. We'll probably see lower
Speaker 1: prices are a bit corn before we see higher. Well,
Speaker 1: I want to thank you very much. Bruce Biddles is
Speaker 1: the chief investment strategist for Baired and Company, joining us
Speaker 1: from Sara Sota, Florida, talking about his outlook for what's
Speaker 1: going on in UH stocks and also in the bond market.
Speaker 1: We wish Jamie butter is our US auto reporter, a
Speaker 1: happy eighteen. Good to have you with us. Jamie, your
Speaker 1: story today has to do with car loans, and I'm
Speaker 1: wondering if you could just put this whole idea of
Speaker 1: car loans in the context of the rebates and the
Speaker 1: offers that are being made. You can't help but see
Speaker 1: a television commercial for an automobile maker. I was looking
Speaker 1: at one Chevrolet, I believe, extending their employee discount to
Speaker 1: any one that comes in. If you're offering like you know, off,
Speaker 1: this can't be a great market, or am I missing something? Well, um,
Speaker 1: it's it's not a it's not a perfect market, but
Speaker 1: it's still a pretty pretty darn good market. Uh. And
Speaker 1: you're not, You're not missing anything. But it's that time
Speaker 1: of year where you get some sales. Right. People are
Speaker 1: trying to clear out their old inventory. If you have,
Speaker 1: you know, seen models still out on dealer lots. Uh,
Speaker 1: you know maybe you missed times something or somebody else
Speaker 1: ransom discounts and and left you with too much inventory.
Speaker 1: You just got to get rid of those, right, because
Speaker 1: if you're selling, even if it's never been driven, if
Speaker 1: you're selling in calendar year eighteen, uh, you're going to
Speaker 1: have to give that car away. Well, so they're just
Speaker 1: counting heavily in December and that that helps out. Okay,
Speaker 1: so so they're just counting heavily, but it isn't that bad.
Speaker 1: It's still pretty good. That said, definitely, sales are slowing.
Speaker 1: There was first annual sales decline in the US of
Speaker 1: automobile since two thousand and nine. And you spoke to
Speaker 1: some analysts who widely think that this year will be
Speaker 1: more of the same. Why, yeah, we're so it's reverting,
Speaker 1: We're reverting to the mean. Basically, the view is that
Speaker 1: probably normal you know, normal demand in the US might
Speaker 1: be sixteen and a half million new cars and light
Speaker 1: trucks each year. We were well below that in the
Speaker 1: two thousand nine, two thousand ten, so we had some
Speaker 1: pent up demand. So we kind of overswung and we
Speaker 1: got to you know, seventeen and a half seventeen six,
Speaker 1: and now we're coming back, you know, probably seventeen two seventeen,
Speaker 1: maybe another half million down next year, maybe not quite
Speaker 1: that much. We'll see um. And so it's sort of
Speaker 1: getting its way back and and and there's a lot
Speaker 1: of optimism, you know for those of us who have
Speaker 1: been watching these guys for so long, I mean, uh,
Speaker 1: in the that they're allowing sales to actually decline a
Speaker 1: little bit. Um is a is surprised. It's kind of
Speaker 1: thing that they weren't doing before. For so many years,
Speaker 1: it was so much about scale, and there was, you know,
Speaker 1: the ethos, the mindset of the industry was you had
Speaker 1: to be bigger, bigger, bigger, And you know, GM, with
Speaker 1: its bankruptcy really taught us, you know, you can't always
Speaker 1: do that, but that isn't always the way. And so
Speaker 1: now they're leaner and they can they can afford to
Speaker 1: be a little smarter. Okay, So Jamie, you're painting a
Speaker 1: pretty rosy picture that the decline in sales is at
Speaker 1: least in part by design, and that the automakers are
Speaker 1: allowing this to happen. But on the flip side, you
Speaker 1: are seeing the expectation of rising rates this year. We
Speaker 1: already have seen overnight rates rise this year's last year. Rather, Um,
Speaker 1: I'm just struggling with pairing that and the idea that
Speaker 1: the credit is less available in some ways or will
Speaker 1: become less available, And is this something that they're going
Speaker 1: to be kind of they're forced to make it sound rosy. Yeah, well,
Speaker 1: we do have to keep an eye on incentives next
Speaker 1: year because you know, so you know, with volume above
Speaker 1: sixteen and a half, everybody should be making lots of money,
Speaker 1: even if they're discounting their vehicles a bit. But in
Speaker 1: a in a tightening market, you get executives whose you know,
Speaker 1: compensation is geared around market share, maintaining market share, even
Speaker 1: gaining market share, and trying to do that in a
Speaker 1: tide market, things could get messy and you we could
Speaker 1: start to see I mean, we got to keep our
Speaker 1: eye on all the companies that that that Lee have
Speaker 1: leaned on incentives in the past and gotten themselves in trouble,
Speaker 1: whether that's you know, GM, you know has their employee pricing. Now,
Speaker 1: you know, if they can't turn that off at the
Speaker 1: end of if they didn't turn that off at the
Speaker 1: end of December like usual, that could be a problem.
Speaker 1: Chrysler's one in the past has been a problem. Uh,
Speaker 1: they've really overrelied. Obviously, we want to keep an eye
Speaker 1: on Nissan and Hunt and some others because uh, things
Speaker 1: could get could get messy. But in theory, they all
Speaker 1: see it coming and they're and they're going to manage
Speaker 1: for it and and not uh, you know, shoot themselves
Speaker 1: in the foot. Yeah, thank you so much for joining us,
Speaker 1: and happy New Year to you. Jamie Butter's is US
Speaker 1: autos reporter for Bloomberg News, coming to us from our
Speaker 1: Detroit bureau. And this is sort of a big question,
Speaker 1: uh him that I have frankly, which is, as you
Speaker 1: get rising rates, a lot of the loans that are
Speaker 1: extended to people for cars are floating rate. They're going
Speaker 1: to be some of the most affected. So it'll be
Speaker 1: interesting to see what happens here. Yesterday, Californians were lining
Speaker 1: up to buy recreational marijuana legally for the first time
Speaker 1: as a new law went into effect. What the implications
Speaker 1: of this law are, Perhaps Chris Levy is the best
Speaker 1: position to tell us. He is co chairman and partner
Speaker 1: of Men, which is based in Los Angeles and is
Speaker 1: devoted to helping with the infrastructure behind growing marijuana legally. Uh,
Speaker 1: and he joins us. Now, Chris, first, did I describe
Speaker 1: med men correctly? And second of all, how significant are
Speaker 1: the implications of this new law that goes into affecting California. Well,
Speaker 1: the implications for the new laws are very significant. Um.
Speaker 1: If you look at the market size in California for
Speaker 1: legal marijuana, was a little over two billion, two billion,
Speaker 1: and we think the market potential with about US legalization
Speaker 1: UH is up to seven billion Chris, a threefold increase,
Speaker 1: Chris abt what fort as much as of the cost
Speaker 1: of legal cannabis are taxes? Correct? Significant portion um? Yeah,
Speaker 1: significant portion um. Not necessarily number, but yeah, significan portional taxes.
Speaker 1: There's it out about it. UM. That's obviously part of
Speaker 1: what makes this a win win UM, you know, for
Speaker 1: both consumers and governments. Okay, So that's where I was
Speaker 1: going with this, is that the local governments they are
Speaker 1: satisfied with this because why they can, of course make
Speaker 1: a lot of money. We've noted that Massachusetts is going
Speaker 1: to be selling retail marijuana that starts July one. Maine
Speaker 1: has approved that, Colorado, Washington, Oregon, Alaska, Nevada. Will this
Speaker 1: tip the federal government into allowing marijuana businesses to access
Speaker 1: the legal financial industry? Well, the marijuana business UM can
Speaker 1: already access the financial industry. The Department of Treasury UM
Speaker 1: approved guidelines in around banking in legal cannabis, and there's
Speaker 1: now over three hundred financial institutions that engage UM in
Speaker 1: some foreign banking in the marijuana industry. But your bigger question, Um,
Speaker 1: I do think that this um, that there was a
Speaker 1: real watershed with the election in November. And when you
Speaker 1: look at the trend towards legalization at the state level,
Speaker 1: I do think it's inevitable that at the federal level
Speaker 1: we will see policy continue to to loosen up, and
Speaker 1: eventually we believe we will see full legalization at the
Speaker 1: federal level. Chris, you previously oversaw a hundred and fifteen
Speaker 1: billion dollars of fundamental equities at Black Rock. Investing in
Speaker 1: the marijuana industry seems pretty far removed from that world.
Speaker 1: And I'm wondering do your former colleagues still kind of
Speaker 1: look at what you do as sort of, you know,
Speaker 1: eyebrows raised and saying, oh, yeah, you're investing in marijuana,
Speaker 1: did you try some or whatever else joke you can
Speaker 1: insert there. Um, has it hard to be treated differently now? Yeah?
Speaker 1: And I say that that shift happened a little while back, um,
Speaker 1: And remember that I work in a community of investors,
Speaker 1: and investors are all about the business and is this
Speaker 1: a good industry or not? And when you look at
Speaker 1: the business characteristics of the marijuana industry, how they're very
Speaker 1: They're very compelling, and most of my colleagues from Wall
Speaker 1: Street get that. Well, will it be as compelling while
Speaker 1: it's made even more legal and accessible. Isn't part of
Speaker 1: the popularity that it is not legal and accessible to everyone? Well? Now,
Speaker 1: from a demand perspective, UM and I should note that
Speaker 1: we we support full legalization and we support full legalization
Speaker 1: at the federal level because we think it makes both, Um,
Speaker 1: it makes sense for society and also makes sense for business.
Speaker 1: And uh no, I think as we open up the market, UM,
Speaker 1: that's going to create more and more opportunities for for
Speaker 1: the players, especially for the players who have scale. And
Speaker 1: given the scale that we have, UM, we think we're
Speaker 1: positioned to benefit from all that. Well, having said that,
Speaker 1: will the industry then also take legal responsibility for any
Speaker 1: potential problems that happen as a result of the consumption
Speaker 1: of legal cannabis? I mean, I think for example, of
Speaker 1: liquor establishments, and you know, if you drive after having
Speaker 1: a drink, you're going to be legally responsible for what happens. Yeah,
Speaker 1: I mean, we'll leave that up to the regulators UM
Speaker 1: and uh to determine that on a city vice city basis,
Speaker 1: But what I will say is when you look at
Speaker 1: the fast round cannabis, um, you know this is something
Speaker 1: that that's used responsibly, is really similar and in some
Speaker 1: metrics safer than alcohol. You know, if you look through
Speaker 1: Colorado for instance, UM, you know the UY related incidences
Speaker 1: are are down. Chris, just real quick, whatever turn has been, like, say,
Speaker 1: for last year in marijuana related investments, come again with
Speaker 1: a question, what were returns like last year for marijuana
Speaker 1: related investments? Well, there there really is not much of
Speaker 1: a public stock market in the US. The point Tom,
Speaker 1: if we look north as the border in Canada, Um,
Speaker 1: you know the returns were We're off the charts. How
Speaker 1: those thoughted extremely Well, all right, we gotta we gotta,
Speaker 1: we gotta run. We want to thank you very much.
Speaker 1: Chris Levy is the co chairman and the partner at Medmen,
Speaker 1: talking about investing in legal cannabis that began yesterday in California,
Speaker 1: and we'll be updating you one results from those continued sales.
Speaker 1: Thanks for listening to the Bloomberg P and L podcast.
Speaker 1: You can subscribe and listen to interviews at Apple Podcasts, SoundCloud,
Speaker 1: or whatever podcast platform you prefer. I'm Pim Fox I'm
Speaker 1: on Twitter at pim Fox. I'm on Twitter at Lisa
Speaker 1: Abramowits one before the podcast. You can always catch us
Speaker 1: worldwide on Bluebirg Radio