Speaker 1: Welcome to the Bloomberg Penel podcast. I'm Paul swing you.
Speaker 1: Along with my co host Lisa Brahma Waits. Each day
Speaker 1: we bring you the most noteworthy and useful interviews for
Speaker 1: you and your money. Whether at the grocery store or
Speaker 1: the trading floor. Find a Bloomberg Penl podcast on Apple
Speaker 1: podcast or wherever you listen to podcasts, as well as
Speaker 1: at Bloomberg dot com. We have talked about President Trump's
Speaker 1: what he calls his biggest trade negotiation achievement to date,
Speaker 1: which is the U S m c A that is
Speaker 1: the new NAFTA. But interestingly, the largest federation of unions
Speaker 1: in the United States is going to oppose this deal
Speaker 1: if there is an early vote called Joining us now
Speaker 1: to talk about that and in general about the backdrop
Speaker 1: for labor as Richard Trumka, president of the a f
Speaker 1: l c I, oh, thank you so much for being
Speaker 1: with us. So let's start with the U S m
Speaker 1: c A trade agreement. Why won't the a f l
Speaker 1: c I O support this this treaty if an early
Speaker 1: vote is pursued. Well, first of all, the labor movement
Speaker 1: is committed to ensuring that trade union deals benefit working people.
Speaker 1: That requires you have strong labor provisions and strong enforcement provisions.
Speaker 1: In order for this to work, Mexico has to abandon
Speaker 1: its low wage model, and it requires Mexico to change
Speaker 1: its laws, enforce its laws, and then have the resources
Speaker 1: necessary and the will necessary to do that. If we're
Speaker 1: forced to vote on NAP on the new NAFTA before
Speaker 1: they have changed their laws, effectively put them in place,
Speaker 1: and started to enforce them, we would have no choice
Speaker 1: but to impose them because the old system, the old
Speaker 1: low wage model of such jobs out of the United States,
Speaker 1: would remain in place. So the agreement itself says they
Speaker 1: have to be in place first. We don't want to
Speaker 1: premature vote. If we're forced to, we would have to
Speaker 1: oppose a that point. So, Richard, you talk about greater enforcement,
Speaker 1: does that mean that the negotiations of the agreement need
Speaker 1: to be opened back up the There are a number
Speaker 1: of ways to do enforcement. In fact, the agreement so
Speaker 1: far Paul could be looked at as having less enforcement
Speaker 1: than previous agreements. And here's how under the current system,
Speaker 1: you when of two countries have a dispute, they in panel,
Speaker 1: they go to a mechanism that they go through. They
Speaker 1: try to solve it. If they can't, they put together
Speaker 1: a panel. That panel acts like an arbitrator. That arbitrator
Speaker 1: makes a decision that is binding on them the new law,
Speaker 1: the new negotiated. When abandoned those panels, either party has
Speaker 1: the ability to block the paneling of those of the
Speaker 1: panel and therefore block any mechanism. There's no no way
Speaker 1: to enforce the Act at that point or the trade
Speaker 1: agreement at that point, so it has to be changed.
Speaker 1: You can do some of it in the implementing language. Uh.
Speaker 1: And we've been told a lot of that will be done,
Speaker 1: although we haven't seen it yet to be able to
Speaker 1: evaluate it. If he didn't, it isn't done. It isn't changed. Uh.
Speaker 1: And the ability to force the agreement isn't there. It's
Speaker 1: a useless agreement and it will actually be worse than
Speaker 1: the current When do we have Richard Trump cut from
Speaker 1: your perspective? Is representing thousands of workers out there? Do
Speaker 1: you think President Trump's policies have been good in general
Speaker 1: for them? You know, if you look at things, uh objectively,
Speaker 1: some of the stuff he's done, you could say that
Speaker 1: he's made a lot of our members lives harder. You know,
Speaker 1: he denied paychecks the federal workforce while he made him work.
Speaker 1: He jammed through a corporate tax cut on the backs
Speaker 1: of working people that encourages further outsourcing and automation. Uh.
Speaker 1: If you look at that, he's made our our pockets
Speaker 1: fly her. He just changed the rule that took over
Speaker 1: time away from over two million people, and he's made
Speaker 1: our jobs more dangerous. He slashed the number of safety regulations,
Speaker 1: He slashed the number of OCEHA inspectors. Just last month,
Speaker 1: he gutted the rule requiring employers to submit detailed reports
Speaker 1: on all workplace injuries. And so you can make the
Speaker 1: case that workers along those lines are worse off. We'll
Speaker 1: have my richard. As it relates to China, are you
Speaker 1: satisfied with the President's trade stance towards China or do
Speaker 1: you have any concerns? Well, you know, first of all,
Speaker 1: I paud the president for being willing to take trade
Speaker 1: on and actually talk about changing after that. That's an
Speaker 1: important step. So I give him credit for that. I
Speaker 1: also give him credit for for looking at China. You know,
Speaker 1: trade relationships are an opportunity really to strengthen democracies, to
Speaker 1: stimulate economies, and to uplift the well being a people
Speaker 1: here around the world. But they can also be used
Speaker 1: the other way to harm people and to undermine those rights. UH.
Speaker 1: And right now China has been doing that. We have
Speaker 1: the worst deficit, the largest deficite we've ever had in
Speaker 1: the world, uh four hundred and nineteen billion dollars in
Speaker 1: growing uh. And so looking at that relationship, trying to
Speaker 1: change it is very very important, and we'll continue to
Speaker 1: work with the administration try to make sure that that
Speaker 1: relationship gets right it because currently it's off course Richard,
Speaker 1: a lot of people say there has been too much
Speaker 1: emphasis placed on trade as the sort of villain here
Speaker 1: in terms of people losing their jobs, and that really
Speaker 1: the issue is automation. Uh. The lot of jobs previously
Speaker 1: that we're unionized and UH and that that gave people
Speaker 1: decent salaries are now eliminated through automation. How are you,
Speaker 1: as the head of the a f l c I O,
Speaker 1: addressing that, Well, we have a committee on the Future
Speaker 1: of Work that looks at not only automation, but artificial intelligence,
Speaker 1: robotics and everything else that goes along with it changing
Speaker 1: our ways. But you have to understand one thing, I
Speaker 1: don't except your original premise, because by design, NAPTA distorted
Speaker 1: the power relationships in favor of global employers over workers.
Speaker 1: It weakened workers bargaining power, and it encouraged the d
Speaker 1: industrialization of the US economy. UH. Those that caused wage
Speaker 1: stagnation that continues to this very day. It's a tandem.
Speaker 1: You can't just say it's only trade, but trade is
Speaker 1: a significant portion of wage stagnation and job loss. Automation
Speaker 1: actually can be a job creator in the future if
Speaker 1: we do things right. We're changing our apprentice programs to
Speaker 1: train our people are members for the jobs of the future.
Speaker 1: We're working with universities like Carnegie Mellon and m I
Speaker 1: T the leaders in artificial intelligence, robotics, UH and New
Speaker 1: the Thing the jobs of the future, to get in
Speaker 1: front of that curve so that we figure out how
Speaker 1: those things affect people. Here's a simple question, Lisa, Uh.
Speaker 1: Right now, we have a system that is leaving more
Speaker 1: and more and more people behind inequalities. Growing, artificial intelligence, robotics,
Speaker 1: all the automation, all of those things can accelerate that
Speaker 1: process if it's not done right. And what happens when
Speaker 1: a system no longer can provide a rising standard of
Speaker 1: living from majority of its citizens, a growing majority of existence.
Speaker 1: What happens to that system, It's actually a threat to
Speaker 1: democracy itself, and so we're trying to get in front
Speaker 1: of it, harness it, and make sure that communities, people
Speaker 1: in the community benefit from automation and not just a
Speaker 1: very few people at the very top. Richard Trumpka, thank
Speaker 1: you so much. Richard Trumpka, President at the a f
Speaker 1: l C i OH based on Washington, d C. Joining
Speaker 1: us to discuss the new NAFTA, which is winding its
Speaker 1: way through the congressional approval process. The U. S Treasury
Speaker 1: curve today inverts for the first time since two thousand seven.
Speaker 1: The move follows FED policy shift earlier in the week,
Speaker 1: as well as gloomier economic data, particularly out of Europe today.
Speaker 1: To help us kind of wind through this issue, we
Speaker 1: have Matt Egan. Matt is a portfolio manager and co
Speaker 1: head of the full Discretion team at Loomas Sales and
Speaker 1: Companies based in Boston, but Matt joins us in our
Speaker 1: Bloomberg Interactive Broker studio. Matt, welcome to Bloomberg. Thank you.
Speaker 1: What do you make of this yield curve? News today?
Speaker 1: A bit surprising to me. I think there's a lot
Speaker 1: of pessimism built into the Yeld curve. UM. You know,
Speaker 1: clearly the data has been weak, UM, and you know,
Speaker 1: there's definitely been centered in the manufacturing side of the
Speaker 1: of the global economy. And I guess in some ways
Speaker 1: it's not too surprising because there's been a lot of
Speaker 1: distortions thrown into that side of the economy through the
Speaker 1: trade war that being in last year. And it's not
Speaker 1: surprising it's affecting places like Germany, you know, more because
Speaker 1: they feed into that, you know, that manufacturing cycle on
Speaker 1: the earliest stages. So what does it say to you
Speaker 1: the fact that the Fed is holding off on rate
Speaker 1: hikes is not enough to give people a boost in
Speaker 1: terms of their longer inflation expectations and their longer term
Speaker 1: growth expectations. This is really fascinating. I think the FED
Speaker 1: is um paying closer attention to this or opening this
Speaker 1: up for broader dialogue. And I was UM watching. I mean,
Speaker 1: everybody probably pays attention to the Monetary Policy Forum in Farry, right,
Speaker 1: everybody's got down on their calendar, but it came out
Speaker 1: nine year old has so, but I think what was
Speaker 1: interesting is they came out pretty forcefully. We're talking about, hey,
Speaker 1: we're gonna really take a look at our monetary policy
Speaker 1: and our ability to both fight recessions and drive inflation.
Speaker 1: And they started talking about, uh, you know, concepts like
Speaker 1: average inflation targeting. And I think that there's a good
Speaker 1: chance over the next year or so where they some
Speaker 1: somehow adopt some formal policy revolving around that too, because
Speaker 1: I think, I mean, to a certain extent, this is
Speaker 1: what their m O has been, right, They've been going
Speaker 1: lower for longer, trying to get inflation up. They've talked
Speaker 1: about it. In some ways, you could say they haven't
Speaker 1: been successful. It's been a failure, and so I think
Speaker 1: they're they're sensitive to that. And um, you know, it's
Speaker 1: an open question whether a central bank can really drive
Speaker 1: up inflation or not. I mean, Japan has been trying
Speaker 1: to do this for years. Uh so, but there's a
Speaker 1: feeling that they have to do something, and I think
Speaker 1: that it it has broader implications though well I'm not
Speaker 1: I'm fixed income expert like Lisa. However, I do know
Speaker 1: that an inverted yield curve oftentimes suggests a recession. Do
Speaker 1: you think that now is a higher probability than maybe
Speaker 1: three to six months ago. It is certainly a higher probability.
Speaker 1: I think that the inversion of the yield curve means
Speaker 1: less than it used to when it when it was
Speaker 1: in um what it would mean before. I think because
Speaker 1: of the unusual nature of monetary policy and how it's
Speaker 1: being affected. Uh, but relative to say three or four
Speaker 1: months ago, is clearly that you know, the probability recession
Speaker 1: has risen. I personally think that if I had to
Speaker 1: guess the net next rate hike, it's going to be
Speaker 1: up rather than down, because I think this is similar
Speaker 1: to two thousands fifteen sixteen, a mid cycle correction. Uh.
Speaker 1: It's mainly coming through the inventory channels, and you know,
Speaker 1: this may be a leap, but I think we're going
Speaker 1: to see it bottoming here. Problem with that is the
Speaker 1: market is looking at the data and hasn't inflected up yet,
Speaker 1: and that's disconcerting. So as a fixed income investor, is
Speaker 1: this a good time to go into risk your corporate
Speaker 1: debt considering the fact that the FED is backstopping the
Speaker 1: market and that you think that there's over that there's
Speaker 1: too much pessimism baked into the into markets. Right now.
Speaker 1: I do. I think that there is too much pessimism
Speaker 1: baked into concerns about the economy. I think, uh my,
Speaker 1: my mantra recently has been bad news is good news
Speaker 1: for risky assets to the extent that it keeps central
Speaker 1: bankers on the sidelines. And that still holds true even today,
Speaker 1: even given how much stimulus and how long there are
Speaker 1: already has been zero rates. It holds true today. Uh
Speaker 1: And and I think, um, you know, when when you
Speaker 1: think of what usually would drive our recession or or
Speaker 1: an unwind, and say that the credit market, it will
Speaker 1: talk about high yield and things like that, it's usually
Speaker 1: the FED raining on everybody's parade, right tightening policy, And
Speaker 1: they're far from I mean, it depends on you know,
Speaker 1: how you perceive that, but I would say they are
Speaker 1: certainly not tight. And so I think that based on
Speaker 1: the way the FED is kind of approaching things, this
Speaker 1: new regime in central bank monetary policy, you know, being
Speaker 1: so close to the zero zero lower bound, the surprise
Speaker 1: might be that the expansion lasts longer than people people
Speaker 1: really think it. I think it can so just between
Speaker 1: investment grade and hi yield just right now, How how
Speaker 1: are you allocated. So I'm pretty sanguine on on high yield.
Speaker 1: You know what, fundamentally what drives hi yield risk premiums
Speaker 1: is default risk through the cycle, and as far as
Speaker 1: we can look at look out into the future, over
Speaker 1: the next twelve months or so, the faults are going
Speaker 1: to stay low and spread. You know, it's surprisingly like
Speaker 1: even though spreads seemed tight, they're right on the screws
Speaker 1: for where they should be in terms of the premium
Speaker 1: that you should earn. Matt Igan, we continue to listen
Speaker 1: to your conversation. We're excited to continue to listen to
Speaker 1: your conversation on real yield The Bloomber Television Show today
Speaker 1: at twelve thirty Eastern time. Eader Today Matt Egan, portfolio
Speaker 1: manager and cohead of Loomis Sales Full Discretion Team. Really
Speaker 1: interesting to get some perspective. Perhaps there is too much
Speaker 1: pessimism baked into markets at a time when there really
Speaker 1: isn't an evidence that we're super close to a recession
Speaker 1: or an uptick in uh in default. The pain just
Speaker 1: continues in Germany's manufacturing sector. Really disappointing data today which
Speaker 1: is sending bond yields lower across the world German bond
Speaker 1: yields UH ensuring in ten years yields now negative for
Speaker 1: the first time since two thousands sixteen. Joining us out
Speaker 1: to discuss h is Marcus Ashworth, Bloomberg opinion columnist covering
Speaker 1: the European markets, joining us from our London studios. So Marcus,
Speaker 1: just give us a sense of why this particular data
Speaker 1: point was so important from markets. Well, in some senses,
Speaker 1: I'm not sure it's quite as interesting as perhaps people
Speaker 1: think it is, because this is a continuation of a
Speaker 1: trend when a trend was expected to reverse. In a sense,
Speaker 1: it's surprising because people thought we'd seen the bottom or
Speaker 1: close to the bottom. The signs out of China, signs
Speaker 1: out of other other aspects, indeed services and wages, which
Speaker 1: suggest the German economy is doing pretty well. Um, and
Speaker 1: that the whole bad news from last year of the
Speaker 1: diesel emissions, the rhine level being too low, and again
Speaker 1: indeed China had sort of played out. So it is disappointing.
Speaker 1: But then sentiment, sentiment, and this is then the day.
Speaker 1: This is what it is. It's a person managers survey,
Speaker 1: it's an expectation. Uh. But slightly more concerning is that
Speaker 1: that that France has reversed, but services aren't doing too badly,
Speaker 1: which is the largest share of the economy. So I
Speaker 1: think what everyone's realized that everyone was hoping and banking
Speaker 1: on this, and we've had a of us spit the
Speaker 1: dummy moment where everyone's gone, bunt yields won't go below zero,
Speaker 1: will they, and everyone's sort of reverse. We've also got
Speaker 1: this China Italy talks going on at the moment that's
Speaker 1: causing a few bits of nervousness. And much more importantly
Speaker 1: actually is looked to the States, look to the US.
Speaker 1: The U s yields are dropping and therefore there's less
Speaker 1: excuse to defend even indeed people were that level of
Speaker 1: positive tenure bunt yields. So the combination all this, I
Speaker 1: wouldn't read too much into that one particle number is
Speaker 1: what I'm saying. I think the US move is probably
Speaker 1: here actually more important. So Marcos, you mentioned France, just
Speaker 1: give us an update what's going on there, because it
Speaker 1: is not just Germany. No, um, well, France has had
Speaker 1: this is La jone, there's yellow vests, h problems, should
Speaker 1: we say, which is morph into more of a problem.
Speaker 1: It's become it's got out of hand. It's turning into
Speaker 1: much more of a left wing than allegedly initially right
Speaker 1: wing movement. But the point is that it's not going away,
Speaker 1: and we have ongoing every weekend. We have real problems
Speaker 1: here and it's really hitting confidence in France and clearly
Speaker 1: also France, which is far less dependent on China. Per se.
Speaker 1: It's based implicity say that Germany's dependent on China, but
Speaker 1: certainly they're less dependent and they are, you know, looking
Speaker 1: at different errors and therefore we're showing this is the
Speaker 1: global manufacturing slowdown is not backing away. Both France and
Speaker 1: Germany are very alliance on orders for their manufacturing across
Speaker 1: the world. And it's a sign that growth everywhere is
Speaker 1: dipping and that that has to surprised people because people
Speaker 1: had expected a bit of a bounce this month and
Speaker 1: doesn't look like we're getting it just yet. Anyway, what
Speaker 1: does this mean for the ECBAT Can they raise rates ever? Again?
Speaker 1: If you speak to anyone how you say, I mean,
Speaker 1: I used to help you, and you know I always
Speaker 1: used to say to you that that the easy people
Speaker 1: will never raise rates in my lifetime, and certainly I'm
Speaker 1: talking about my children's are posting my grandchildren's life done now,
Speaker 1: so you know, no, of course they can't. And the
Speaker 1: thing is they try bless them to up constantly leasing
Speaker 1: with all the right reasons, just a year too late.
Speaker 1: They've done it in twenty seventeen. Everyone has sort of
Speaker 1: backed it, but they waited because everything has to pan out.
Speaker 1: By the time they waited, the cycler turned and they're
Speaker 1: looking rather foolish at the moment. The point is that
Speaker 1: they also try to preempt by getting some extra cheap
Speaker 1: super bank funding. But then the media music that that
Speaker 1: the rates going to raise as much as forty maybe
Speaker 1: even fifty basis points for banks funding themselves previously, and
Speaker 1: they had the reverse effects. So they try to be
Speaker 1: dovish and end up being having the reverse effects. So
Speaker 1: they are stump. But look, the reason why we're still
Speaker 1: debating this is because the ECB is not the problem.
Speaker 1: It's a lack of fiscal response in Europe. The monitor
Speaker 1: response is played out. They try to tighten or stop
Speaker 1: being so dovish is the correct way of putting it,
Speaker 1: and still they have to keep on pumping money in
Speaker 1: the banks, pumping money. Ever, you know, they haven't got
Speaker 1: rid of their problems. They didn't do tarp or tell
Speaker 1: for whole after different things, and they're left as bad
Speaker 1: as they were five years ago. So Marcus, let's just
Speaker 1: stay in Germany for a moment, real quickly. What's the
Speaker 1: latest on Deutsche Bank. I know they're out some news
Speaker 1: saying hey, we're going to start growing again, But really
Speaker 1: I think what's going on there? And is it the
Speaker 1: commerce deal almost a fitter complete? Well, you know it is,
Speaker 1: and well and this is this is what funny is
Speaker 1: not the right right word here because it's very unfunny.
Speaker 1: But you know, Ireland essentially got bankrupted by the sense
Speaker 1: that they had to collapse their banks, Greece likewise, Cyprus likewise,
Speaker 1: Italy clearly ongoing. And yet it seems Germany, when it
Speaker 1: comes to Germany, they can they can beat out their
Speaker 1: own two banks. These are two drunks being lashed together
Speaker 1: to try and stay standing. And and and it's not
Speaker 1: a good not a good look. And I think that
Speaker 1: the you know, Deutsche Bank has got a whole world
Speaker 1: of level three as an unmarked remarkable assets and a
Speaker 1: vaster of the book which is beyond the size of
Speaker 1: all comprehension comments Bank has got huge positions in Italian bonds,
Speaker 1: and both of them have got a over competitive banking
Speaker 1: market domestic too many branch is too much toff, not
Speaker 1: enough capital, no chance of making And the keyword here
Speaker 1: is profit ever on their business models and lumping together. Yes,
Speaker 1: to keep going for a bit longer, but it doesn't
Speaker 1: solve anyone's problems. Wow, that is a stark review of
Speaker 1: German banking. But you know, I think it's probably pretty
Speaker 1: spot on because I think not and shared by many
Speaker 1: people and shared by many people. It's you know, you
Speaker 1: put two bad banks together, what do you have? Maybe
Speaker 1: you know one bigger bad bank. Well, there was a
Speaker 1: conference earlier this week in Boston, Massachusetts. Not an investor
Speaker 1: conference per se, but a conference entitled Inside Quantum Technologies.
Speaker 1: This is the first conference dedicated to the business of
Speaker 1: quantum computing, quantum cryptography, and quantum sensors. To get a
Speaker 1: sense of all that quantum stuff, and all that stuff means.
Speaker 1: Let's welcome our guess, Alan Meckler. Allen is a managing
Speaker 1: partner of assam Off Ventures. He joins us in our
Speaker 1: bloom Brick Interactive Brooker Studio. Alan, thank you so much.
Speaker 1: Can you just define briefly what quantum technology is for
Speaker 1: for me at least, and I think our audience that
Speaker 1: that's actually quite hard to do. In a few words,
Speaker 1: I first saw, I'm not a scientist or a technologist.
Speaker 1: I've just been good at spotting trends and doing shows
Speaker 1: on them. But essentially, if you a lot of people,
Speaker 1: I'm sure only and listening, I've heard of super computing,
Speaker 1: and this would uh, quantum computing would make super computing
Speaker 1: look like stone age in terms of the speed and
Speaker 1: the rapidity of and and and the and the depth
Speaker 1: of of what it can solve and um. It has
Speaker 1: huge ramifications for all kinds of security, cybersecurity, uh, and
Speaker 1: the threat to being able if and getting into the
Speaker 1: wrong hands, being able to open up bank counts, and
Speaker 1: all kinds of things. All Right, so let's talk about
Speaker 1: some of the practical applications of this incredibly abstract concept,
Speaker 1: because there are incredibly practical applications, from three D printing
Speaker 1: to some of the pharmaceutical advancements. I want to talk
Speaker 1: about three D printing in particular, because a lot of
Speaker 1: people were expecting that everyone would have a three D
Speaker 1: printer in their home, they would print their chocolate bars,
Speaker 1: they would print their chairs, they would print their you
Speaker 1: know tables. How much has three D printing actually gained
Speaker 1: traction and wear? Three D printing most is most significant
Speaker 1: in uh AN actual manufacturing. There was a theory and
Speaker 1: a lot of companies went out of business that there
Speaker 1: would be three D printer in every home, maybe up
Speaker 1: through two thousand, fifteen or sixteen. But the real benefit
Speaker 1: of it is and and and the real power and
Speaker 1: and where the money is being made is very expensive
Speaker 1: three D printers several hundred thousand to a million dollars
Speaker 1: that print in medals, and and and and other materials,
Speaker 1: but are revolutionizing the way certain types of manufacturing are
Speaker 1: taking place. For example, probably within four or five years,
Speaker 1: fifty percent of every jet engine will be three D printed.
Speaker 1: There are a lot of reasons what we could go
Speaker 1: into why that is. But you can make it more efficiently,
Speaker 1: you can make it lighter, you can make it faster
Speaker 1: and less expensively than traditional manufacturing ways. So we talked
Speaker 1: about some of the practical applications of quantum computing and technologies.
Speaker 1: What are some of the technology who are some of
Speaker 1: the technology companies that are really leading the way here,
Speaker 1: What are the names. Again, it's very important for listeners
Speaker 1: to know that there is no such thing yet as
Speaker 1: a quantum computer. And there's a new term that I
Speaker 1: think you're going to hear pretty soon called uh why
Speaker 1: why to Q if you remember why two K, which
Speaker 1: is years to quantum and we're probably a ten year
Speaker 1: countdown to getting quantum computers. There is a company called
Speaker 1: d Wave that has a version of a quantum computer.
Speaker 1: But uh. At the show we just had inside Quantum
Speaker 1: Technology in Boston, we had many speakers, we had thirty two.
Speaker 1: But for example, IBM has now something called IBM Q.
Speaker 1: They've set up a whole division just to delve into
Speaker 1: being hopefully one of the big players. Microsoft was there too,
Speaker 1: and they've set up their own initiative. And their speaker,
Speaker 1: who is in charge of business development for quantum computing,
Speaker 1: a fellow named Ben Porter. He was saying that they're
Speaker 1: going to concentrate on AI, financial services and chemistry, and
Speaker 1: and they're linking up with a whole bunch of universities.
Speaker 1: A lot of the research, much like my early days
Speaker 1: in the Internet, is coming out of research at universities,
Speaker 1: because again it's not a consumer product. The other really
Speaker 1: key issue is UH security and UH it's a shame
Speaker 1: what's happening that the United States is going to be
Speaker 1: taking a backseat to the Chinese. The Chinese are building
Speaker 1: a facility right now in China. They're spending billion dollars
Speaker 1: on it just to study this. That's actually exactly where
Speaker 1: I wanted to go, which is UH what some of
Speaker 1: the challenges are in this race to develop technology that
Speaker 1: most people agree would be the future. And I'm wondering
Speaker 1: when we talk with executives, they often talk about a
Speaker 1: lack of of people who are trained in the right things,
Speaker 1: and I'm wondering how much you know, some of the
Speaker 1: executives in attendance at your conference talked about that, are
Speaker 1: there enough people in the United States who are who
Speaker 1: you can hire to do these things, to develop these programs? Well,
Speaker 1: there's UH. There is a Quantum National Initiative that I
Speaker 1: think actually the Hudson Institute came up with which the government,
Speaker 1: our government is endorsed. But right now my understanding is
Speaker 1: the US is spending you know, maybe about a billion
Speaker 1: dollars a year UH in all forms and developing quantum computing.
Speaker 1: A Chinese or spending over five billion and then they're
Speaker 1: also doing a ten billion dollar center. Okay, so let's
Speaker 1: say the United States decided to put more money into
Speaker 1: quantum computing. Which areas would you think would be the
Speaker 1: best areas for those investments. Well, one area for sure
Speaker 1: is the military. Um is very important that Chinese actually
Speaker 1: have a quantum mechanic UH satellite that everyone said couldn't
Speaker 1: be done. But it's out. It's out there right now,
Speaker 1: and we don't have enough time to talk about what
Speaker 1: it does. I don't personally know everything that it does,
Speaker 1: but it's very significant. How they're using it in their
Speaker 1: country and how how how they're planning. Uh. The other
Speaker 1: is uh protection for the future. We're going to have
Speaker 1: what we call quantum networks, your cell phones, everything is
Speaker 1: going to be the quantum internet, so everything will be
Speaker 1: much faster. Uh. There's going to be again this situation
Speaker 1: like Y two K where we're going to have to
Speaker 1: have this amazing changeover, and then the security for for
Speaker 1: all the financial institute this is going to be threatened.
Speaker 1: Now that doesn't mean that someone couldn't counter that if
Speaker 1: you were at a bank or whatever. But I still
Speaker 1: think that in this country and at the financial institutions
Speaker 1: and the government. They're they're really not focusing on something
Speaker 1: that is going to be a critical problem. Allen Meckler,
Speaker 1: thank you so much for being with us. A pleasure
Speaker 1: speaking with you. Alan Mackler, managing partner at Asimov Adventures,
Speaker 1: based in New York and Seattle, talking about the Inside
Speaker 1: Quantum Technology conference that just took place in Boston. Thanks
Speaker 1: for listening to the Bloomberg P and L podcast. You
Speaker 1: can subscribe and listen to interviews at Apple Podcasts or
Speaker 1: whatever podcast platform you prefer. Paul Sweeney, I'm on Twitter
Speaker 1: at pt Sweeney. I'm Lisa Abram Woyds. I'm on Twitter
Speaker 1: at Lisa Abram Woyds one Before the podcast. You can
Speaker 1: always catch us worldwide on Bloomberg Radio.