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Speaker 1: Welcome to the Bloomberg Markets Podcast. I'm Paul Sweeney alongside

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Speaker 1: my co host Matt Miller.

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Speaker 2: Every business day we bring you interviews from CEOs, market pros,

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Speaker 2: and Bloomberg experts, along with essential market moving news.

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Speaker 1: Find the Bloomberg Markets Podcast called Apple Podcasts or wherever

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Speaker 1: you listen to podcasts, and at Bloomberg dot com slash podcast.

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Speaker 1: All right, let's get to the news of the day.

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Speaker 1: It comes out of Washington, d C. Of course, former

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Speaker 1: President Trump charged over secret documents, and which is a

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Speaker 1: first for an ex president. We want to round table

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Speaker 1: this thing. We're going to do that today with Bloomberg

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Speaker 1: Law host June Garasso. She's going to join us here

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Speaker 1: in the studio, and Ann Mary Hordern Bloomberg Washington Carsponey

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Speaker 1: usually in DC. Up here in New York at our

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Speaker 1: Bloomberg Interactive Broker Studio. We appreciate getting both June and

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Speaker 1: Anne Marie here and let's start with you. This feels different.

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Speaker 1: I mean, it's federal. Can you put in context what's

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Speaker 1: the feeling coming out of Washington, DC?

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Speaker 3: Well, this is definitely different. First former US president to

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Speaker 3: be tried with committing federal crime. This is a case

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Speaker 3: that even Trump's own Attorney General, Bill Barr, has talked

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Speaker 3: about for months, really that this is going to be

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Speaker 3: the more serious of the case. Also said it was

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Speaker 3: almost one of Trump's own making. He said recently on

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Speaker 3: CBS this morning. He was there two days ago. He

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Speaker 3: said Trump was the one there, his words, jerking around

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Speaker 3: the DOJ when he could have just given up these

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Speaker 3: documents that the National Archives wanted. And then you look

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Speaker 3: at and June definitely will be able to speak to

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Speaker 3: this more. The indictment what we're seeing so far, Obviously

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Speaker 3: it's under seal that could be made public today, though

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Speaker 3: it contains these seven charges, and some of them would

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Speaker 3: normally carry I don't think anyone actually thinks that we're

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Speaker 3: going to see the president behind bars for a decade,

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Speaker 3: but some of them carry potential consequences of ten or

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Speaker 3: twenty years behind prison.

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Speaker 4: So June, I want to bring you into the conversation

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Speaker 4: breakdown more specifically what these charges.

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Speaker 5: Are well, and just a reminder that we don't know

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Speaker 5: what the charges are specifically. This is all based on sourcing,

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Speaker 5: has been under seal and it may not be opened

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Speaker 5: until actually until Tuesday, when he reports to the court.

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Speaker 5: But it may be open sooner. So there are several

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Speaker 5: seven charges. They include wilful retention of national defense information,

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Speaker 5: corruptly concealing documents, conspiracy to obstruct justice, and making false statements.

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Speaker 5: The conspiracy charge is particularly interesting to me because it

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Speaker 5: means that there was someone else. There has to be

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Speaker 5: two people involved in a conspiracy, so the prosecutors have

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Speaker 5: someone else who they're either going to charge or who

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Speaker 5: is going to testify against Trump and one of the

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Speaker 5: possible people. When you think about the evidence that they have,

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Speaker 5: they don't only have people. They have video and audio evidence.

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Speaker 5: And part of the video evidence is a man moving

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Speaker 5: boxes into a storage boxes of documents into the storage

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Speaker 5: space at marra A Lago the day before the prosecutors

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Speaker 5: were set to arrive there. So they have lots of evidence.

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Speaker 5: They also have what's kind of incredible. They have an

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Speaker 5: audio tape of Trump at his Bedminster golf club waving

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Speaker 5: a document around and saying that it was a document

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Speaker 5: with sensitive military information related to Iran in his possession,

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Speaker 5: and he says that he knows, according to a transcript,

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Speaker 5: he knows that he doesn't have the authority to show this.

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Speaker 5: So they have lots and lots of evidence.

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Speaker 1: Hey, June, I just want to we got one little

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Speaker 1: piece of news that started and I guess it's just

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Speaker 1: going to come out and drips and drabs. But US

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Speaker 1: Judge Aileen Cannon has been assigned to the criminal case.

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Speaker 1: And I believe she is a Trump appointee. What does

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Speaker 1: that mean to you?

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Speaker 5: When I was thinking of why they moved the case

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Speaker 5: and the pros and cons of moving the case to Florida,

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Speaker 5: I thought, Wow, I hope they don't get Judge Eileen

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Speaker 5: Cannon because it's not just that she's a Trump appointee.

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Speaker 5: It's that she was the one appointed to be a

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Speaker 5: special Master to review the material sees from mar A Lago,

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Speaker 5: and she gave some I don't know, head scratching decisions

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Speaker 5: that people were sort of shocked by, and one of

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Speaker 5: them which prevented the FBI from using the c's classified

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Speaker 5: documents as part of their investigation until she completed her review,

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Speaker 5: which could take months, and that was ultimately thrown out.

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Speaker 5: She was reversed by the Eleventh Circuit and there was

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Speaker 5: some sharp language in there about her. So she's in

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Speaker 5: it for this initial part. If she stays on it,

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Speaker 5: I think the Justice Department will have some problems.

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Speaker 4: Annriy want to bring you back into this conversation. How

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Speaker 4: does all of this end up impacting his campaign? Is

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Speaker 4: he's under indictment once again.

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Speaker 3: Yeah, it's going to be an even more wild ride,

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Speaker 3: it feels like for the twenty twenty four campaign. So

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Speaker 3: initially with the former president, anytime he faces a struggle,

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Speaker 3: illegal hurdle, his numbers go up in the polls, and

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Speaker 3: also his campaign dollars go up. There's a big question

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Speaker 3: about this specifically because of how serious these charges are.

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Speaker 3: Potentially how the other candidates, now it's much wider field

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Speaker 3: in terms of Republican nominations, how they react. What you

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Speaker 3: already are seeing is I think one individual only came

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Speaker 3: out and said they would pardon the former president, Vivik Ramaswami.

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Speaker 3: He came out and said that's what he would do,

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Speaker 3: and then others are taking a more moderate tone. Chris Christie,

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Speaker 3: we know that he's almost running this race to just

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Speaker 3: bash Trump, but he did say let's see the facts.

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Speaker 3: I think all candidates will come out and say they're

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Speaker 3: presumed innocent like all defendants. But a big question and

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Speaker 3: a litmus test for every nominee. Now, every question they're

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Speaker 3: going to get whether they show up in Iowa, New Hampshire,

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Speaker 3: South Carolina, is will you pardon the former president?

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Speaker 6: Okay?

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Speaker 3: And that's going to now shape I think a lot

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Speaker 3: of the Republican field.

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Speaker 1: June can you give us. I know we haven't even

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Speaker 1: seen the indictment, but on these types of cases, a

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Speaker 1: sense of timing, how does this play out? And just

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Speaker 1: to follow on Ann Mary's comments about the election, is

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Speaker 1: this some thing a six month process, a twelve month process,

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Speaker 1: a multi year process.

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Speaker 5: It's not multi year, And I mean it depends on

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Speaker 5: how many motions there are before how I assume the

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Speaker 5: Trump team is going to try to slow the process

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Speaker 5: down with motions. Now, what's interesting is what the prosecution

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Speaker 5: did here. In order to prevent some of the most

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Speaker 5: weight emotions, which would be a motion to change venue,

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Speaker 5: they decided to go from Washington, d c. Where the

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Speaker 5: grand jury was hearing evidence for months, to Florida so

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Speaker 5: that the defense wouldn't be able to raise that as

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Speaker 5: a reason to slow things down, throw the case out

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Speaker 5: and move it somewhere else. But I mean it could

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Speaker 5: come before the before the election. There's no doubt that

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Speaker 5: it could. There's also the other case in New York,

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Speaker 5: which has which is I think supposed to go March.

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Speaker 5: But and then you have in July or August. Do

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Speaker 5: you have the district attorney in Fulton County going to

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Speaker 5: announce possible charges against Trump. So you're going to have

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Speaker 5: all these judges, you know, jockeying and trying to figure

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Speaker 5: out when they could have a trial. So but it

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Speaker 5: could happen before before the election for sure.

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Speaker 4: And Marie, any sort of indication from your sources about

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Speaker 4: what the chances are for an actual conviction on this, No,

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Speaker 4: I don't think we're even closer to that point.

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Speaker 3: There's one I think interesting wrinkle and June can definitely

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Speaker 3: speak to this is I think everyone going into this

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Speaker 3: thought it was going to be in Washington, in Washington, DC,

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Speaker 3: And this is almost a coup for the former president

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Speaker 3: that it's happening in Florida. This is his home turf.

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Speaker 3: He has tremendous amount of support in Florida. He won

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Speaker 3: that state. And I think if it was going to

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Speaker 3: the trial was going to be and the case was

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Speaker 3: going to be conducted of Washington, his team had already

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Speaker 3: said they would try to move it to Florida, and

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Speaker 3: already they're already it's starting in Florida June. Actually, I

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Speaker 3: wonder do you think that them coming out and moving

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Speaker 3: it to Florida helps the former president or because they

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Speaker 3: wanted to motion to move it, it actually takes one

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Speaker 3: of their tools out of the toolbox.

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Speaker 5: Well it's sort of a double edged sword because it

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Speaker 5: takes one of the tools out of their toolbox, which

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Speaker 5: would slow things down, But at the same time, it

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Speaker 5: puts him in a really favorable venue. You know, as

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Speaker 5: you said, Floridians voted for voted for Trump, and you

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Speaker 5: know he but he will not be able to say

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Speaker 5: the things he said about the New York jury during

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Speaker 5: the Eugene Carroll trial, how they were all against him,

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Speaker 5: and he'll take that, will take his that talking point away.

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Speaker 5: But yeah, I think it's I think it was a

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Speaker 5: calculated move by the prosecutors. They want to move the

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Speaker 5: case along, so they want to avoid that venue challenge,

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Speaker 5: but at the same time, the jury pool is not

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Speaker 5: going to be as favorable to them, I think, although

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Speaker 5: they are in Miami.

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Speaker 3: So but it could potentially move to West Pump.

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Speaker 5: Each Yes, it could, it could. This is all up

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Speaker 5: in the air. Who decides that, Well, there might be

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Speaker 5: motions by the defense to move it. And right now

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Speaker 5: I'm not too sure where the judge Cannon is.

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Speaker 1: I'm not sure.

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Speaker 5: I'm not sure because we just found out about her

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Speaker 5: a few minutes ago. So this is moving so quickly.

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Speaker 5: But you know, there could be a motion to move it,

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Speaker 5: or they could just decide that that's the better venue

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Speaker 5: for it because that's where mar A Lago is.

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Speaker 1: So so, Henriy, what have we heard, if anything, from

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Speaker 1: the Biden administration. What do we expect to hear from

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Speaker 1: the Biden administration? How do we think they're going to

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Speaker 1: play this whole thing?

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Speaker 3: So Biden was asked about this yesterday he was giving

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Speaker 3: a press conference with Richie Suneck of the UK, and

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Speaker 3: of course reporters always want to ask about the hot

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Speaker 3: story of the day, and he dismissed any of these

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Speaker 3: suggestions that a potential indictment of the former president would

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Speaker 3: potentially be politically motivated, because that's what the Republicans are

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Speaker 3: really going to want to coalesce around this message. And

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Speaker 3: you already seen some conservative networks of news saying it's

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Speaker 3: Biden's doj going after the former president. So Biden said,

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Speaker 3: you'll notice I have never once, one single time, suggested

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Speaker 3: the Justice Department what they should do or not do

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Speaker 3: relative to bring in charge or not bring a charge.

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Speaker 3: He said, I'm honest. We also need to remember the

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Speaker 3: current president is also facing a special counsel inquiry into

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Speaker 3: his documents that's still pending. But Vice President Mike Penn's

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Speaker 3: former vice president his was actually concluded, there's very different

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Speaker 3: You could draw a lot of parallels because everyone has

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Speaker 3: these documents at home, but there's very different cases. I

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Speaker 3: think Biden and Pence really wanted to get rid of them,

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Speaker 3: while many were saying Trump.

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Speaker 5: Wanted to keep them. And as she said, what the

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Speaker 5: Trump people have been saying, what Trump has been saying,

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Speaker 5: this prosecution is by the Biden administration. All these different

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Speaker 5: things about the witch hunt that's going to play. That's

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Speaker 5: for the court of public opinion, that's for the jury

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Speaker 5: pool that's out there, but that is not going to

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Speaker 5: happen in court. As we've seen case after case, those

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Speaker 5: kinds of discussions just don't take place and don't have

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Speaker 5: an effect.

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Speaker 1: We're going to be talking to you, Drewne. A lot

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Speaker 1: I think are the coming days, weeks, and months. All right,

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Speaker 1: I want to thank Bloomberg Law host June Grasso and

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Speaker 1: Bloomberg Watching correspondent Ann Marie Hordern, both here in our

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Speaker 1: studios starting to get some initial analysis on what is

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Speaker 1: going to be a very complex case.

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Speaker 6: Here, you're listening to the team Ken's are live program

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Speaker 6: Bloomberg Markets weekdays at ten am eastering on Bloomberg dot com,

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Speaker 1: Let's just go right to the bond market. And why not,

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Speaker 1: because again I've been saying you can after twenty twenty two,

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Speaker 1: just when you got crushing equities, crush bonds. Four point

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Speaker 1: six percent in a two year bond seems pretty good

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Speaker 1: to me for the treasury market.

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Speaker 4: It definitely is, especially after the pain last year and

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Speaker 4: looking ahead to next week's FED meeting. Look at these

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Speaker 4: swap traders pricing in a roughly one third chance that

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Speaker 4: we're going to see a FED hike next Yeah.

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Speaker 1: Absolutely, so that'll be top of mine next week and

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Speaker 1: we'll have full coverage of that. Let's check with Natalie Trevithik,

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Speaker 1: She's head of investment grade credit strategy at paid and regal. So, Natalie,

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Speaker 1: what do you think about my trade. I'm just going

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Speaker 1: to go put some money in a two year Treasury note.

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Speaker 7: I think that's a great trade, Paul, But I advise

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Speaker 7: even going into corporate bond you get five and a

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Speaker 7: half percent, so it's worth that minimal incremental risk to

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Speaker 7: go into corporates.

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Speaker 4: So, Natalie, what is the bond market telling us about

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Speaker 4: the direction of the economy at this point in what

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Speaker 4: it can mean for the FED decision next week.

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Speaker 7: I think it's telling us that we're in pretty good shape.

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Speaker 7: We've seen a pretty big rally in corporate bonds or

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Speaker 7: almost back to the levels they were at the beginning

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Speaker 7: of the year pre the banking crisis, and we've seen

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Speaker 7: a big recovery in both banking spreads and equities, particularly

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Speaker 7: among the regionals. That gives us some confidence.

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Speaker 4: So in the.

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Speaker 1: Investment grade space, Natalie, kind of how are you thinking

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Speaker 1: about things? Are you going sector bi sector? Are you

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Speaker 1: focusing more on duration? How are you guys approaching the

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Speaker 1: investment grade space these days?

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Speaker 7: Yeah, it's a number of items. Definitely duration. We're seeing

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Speaker 7: more demand for the long end of the curve. Even

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Speaker 7: though those the front end, as you mentioned, is very attractive,

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Speaker 7: we aren't sure how long it's going to last for

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Speaker 7: so investors really want to lock in these ten and

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Speaker 7: thirty year yields at these higher levels, and with corporate

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Speaker 7: bond you're getting close to six percent there. Among the

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Speaker 7: sectors we do like communications technology. We think banking has

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Speaker 7: a little bit more to run, particularly in some of

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Speaker 7: the regionals, and those are most attractive in the front

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Speaker 7: end of the curve.

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Speaker 4: What are you hearing from clients at this point as

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Speaker 4: far as what their concerns are, and maybe concerns maybe

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Speaker 4: they had at the beginning of the year, not so

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Speaker 4: much at this point.

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Speaker 7: Yeah, the concerns at the beginning of the year was

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Speaker 7: the recession, and they were already pricing in FED cuts

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Speaker 7: and that's not going to be the case. We don't

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Speaker 7: think right now. They're concerned about all of this treasury supply.

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Speaker 7: We're likely to get posts to debt sealing resolution. People

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Speaker 7: are talking anywhere from five hundred billion to a trillion

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Speaker 7: of T bill supply this summer, and they're worried that

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Speaker 7: mini crowd out investments in other places, such as corporate bonds.

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Speaker 1: So Natalie. One of the challenges for investors is trying

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Speaker 1: to get a sense of where this economy really is going.

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Speaker 1: So you know, when your analysts come to you or

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Speaker 1: your pms come to you with an idea, do you

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Speaker 1: ask them, Hey, have you run your recession model? And

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Speaker 1: if so, how does this credit fair? Are Is that

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Speaker 1: top of mind for you guys?

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Speaker 7: Exactly? Even though recession may still be you know, six

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Speaker 7: months to a year out, if it does come, we

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Speaker 7: are definitely running our recession models. How are these companies

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Speaker 7: going to do? Fortunately, most companies have been well prepared.

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Speaker 7: This is the most well telegraphed recession potentially coming, so

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Speaker 7: they have started already to cut their cappex or cut

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Speaker 7: dividends or share buybacks where necessary. So many companies are

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Speaker 7: defensively positioned. We've actually seen a number of upgrades back

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Speaker 7: to investment grade from high yield this year, such as

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Speaker 7: Occidental Petroleum recently.

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Speaker 4: When it comes to this concern about how the US

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Speaker 4: debt deal would potentially trigger this one trillion dollar liquidity crunch,

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Speaker 4: especially when we're looking at what's happening in bond market,

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Speaker 4: what's your take on that.

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Speaker 7: I think it may be overblown because globally, investors are

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Speaker 7: still flush with cash. We see that in the corporate market,

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Speaker 7: where deals are like five times subscribed. Yesterday we had

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Speaker 7: US Bank Corporate in the market with three and a

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Speaker 7: half billion, and they actually had eighteen billion of demand

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Speaker 7: for that deal. So it seems like the market will

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Speaker 7: be able to absorb all of this T bill issuance.

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Speaker 1: Yeah, that's kind of where I wanted to go. Natalie's

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Speaker 1: kind of the new issue market. As a former banker myself,

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Speaker 1: I always like to see deals, the deal flow and

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Speaker 1: who's coming to market and what kind of pricing they're getting, So,

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Speaker 1: you know, even the rates are higher, it seems like

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Speaker 1: new issuance is still pretty active. Is your phone ringing

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Speaker 1: off the hook from our friends on Wall Street?

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Speaker 7: Yeah? Absolutely, The new issue market has been very active. First,

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Speaker 7: there was a surge of issuance trying to get ahead

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Speaker 7: of the debt ceiling, and the banks were kind of

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Speaker 7: locked out of the market for a little while there

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Speaker 7: in March and April. Now that the debt ceiling is over,

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Speaker 7: we've seen banks come back with huge issuance twenty seven

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Speaker 7: billion this week, though there's still about forty percent under

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Speaker 7: the rate of issuance they had in twenty twenty two,

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Speaker 7: so we still expect to see a lot more supply,

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Speaker 7: But now that regionals have been able to access to

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Speaker 7: the markets this week, we think smaller regionals will start

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Speaker 7: to come.

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Speaker 1: And how about that when you see some of these

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Speaker 1: new deals, are they investor friendly in a sense that

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Speaker 1: that some strong covenants in there or do you get

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Speaker 1: a sense that it's more the leverage is on a

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Speaker 1: part of the issue. Where are we in the market

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Speaker 1: right now?

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Speaker 7: Yeah, an investment grade, there's generally not that strong covenants,

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Speaker 7: but we are seeing investors push back on the high

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Speaker 7: yield market to make sure the covenants are a little

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Speaker 7: bit stronger.

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Speaker 8: Here.

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Speaker 7: We are seeing better concessions though in terms of pricing,

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Speaker 7: and they're leaving a little bit on the table so

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Speaker 7: that these deals perform in the secondary market.

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Speaker 4: I have to ask you about the yield curve. What

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Speaker 4: do you think this is telling us about the economy.

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Speaker 7: Yeah, it's not a good sign. It's definitely a recession indicator,

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Speaker 7: even though we aren't as inverted as we were in

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Speaker 7: two tens previously. But I also think you know that

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Speaker 7: the Fed's going to leave rates higher for longer, probably

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Speaker 7: until twenty twenty four, and there's always the risk that

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Speaker 7: the FED may have broken something, and we really haven't

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Speaker 7: had a long enough of a timeline to see all

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Speaker 7: of these factions take place in the marketplace. The Silicon

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Speaker 7: Valley Bank failure was definitely one indication that the FED

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Speaker 7: may have gone too far.

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Speaker 1: Now, do you guys invest solely in the US or

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Speaker 1: do you go outside of the US as well?

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Speaker 7: No, we invest globally, lots of emerging markets. We have

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Speaker 7: a very dedicated team here on that.

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Speaker 1: All right, so let's go there a little bit. When

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Speaker 1: you think outside of the US borders, kind of how

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Speaker 1: do you kind of prioritize where you guys are looking.

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Speaker 7: We're looking at countries with stable governments. We're also looking

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Speaker 7: at oil importers versus oil exporters. We're following the election

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Speaker 7: cycle which is going on, so it's really bifurcated across

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Speaker 7: from markets and.

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Speaker 4: We're talking about exporters versus importers for crude and things

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Speaker 4: like that. Is it obviously that correlation with what we've seen,

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Speaker 4: especially with oil prices in the US around when you're

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Speaker 4: thinking about that sort of seventy dollars threshold there and

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Speaker 4: what that could mean for the opportunities in those particular

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Speaker 4: emerging markets exactly.

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Speaker 7: And we do think seventy dollars is close to a floor,

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Speaker 7: so we aren't foreseeing a crash in oil, so we

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Speaker 7: think the man is likely going to hold up fairly well.

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Speaker 7: But it also depends on the depth of the recession

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Speaker 7: if we get one.

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Speaker 1: So when you think about emerging markets, I'm not sure.

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Speaker 1: And this is equities, it's credit, it's you know, you

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Speaker 1: think about China. It's such a big part of the MSCI,

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Speaker 1: I mean, is there How do you think about emerging markets?

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Speaker 1: Where where do you find opportunities? Do you even think

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Speaker 1: about China or do you kind of stay a little

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Speaker 1: bit more close to home.

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Speaker 7: Yeah, China's a pretty bifurcated market because there's a very

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Speaker 7: high quality end of the spectrum where you have such

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Speaker 7: as the Ali Baba's and ten Cent good investment grade credits,

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Speaker 7: and then you have the Chinese property market, which we're

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Speaker 7: still a little bit cautious on. So it really starts

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Speaker 7: to get down to a name by name basis even

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Speaker 7: within these emerging markets.

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Speaker 4: Something I wanted to get your take on because we're

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Speaker 4: going to get another update on the CFTC data this

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Speaker 4: afternoon around three point thirty, and I noticed, particularly in

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Speaker 4: the bond market, when it comes to the shorting that's

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Speaker 4: happening on the US ten year, it's at a very

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Speaker 4: extreme positioning. Usually that happens when investors are thinking that

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Speaker 4: yields potentially betting that they would go higher. But such

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Speaker 4: extreme positioning, when I've talked to some sources, think that

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Speaker 4: might have the opposite effect, ended up pushing yields lower

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Speaker 4: and then maybe supporting more equity prices. Why do you

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Speaker 4: think we're seeing such extreme shorting happening on the ten

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Speaker 4: year right now?

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Speaker 7: Yeah, it's a bit of a mystery. I think there's

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Speaker 7: all this positioning and jockeying ahead of the FED meeting,

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Speaker 7: But it does seem that, like post these sped decisions,

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Speaker 7: sometimes the bond market moves in opposite directions than what

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Speaker 7: you would expect by the statements, and some of that's

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Speaker 7: driven by the short positioning being offset afterwards.

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Speaker 1: All right, Natalie, for me, next Wednesday is Flag Day,

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Speaker 1: but for others in the market, it's it's FED Day.

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Speaker 1: What is your foot or reserve going to do?

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Speaker 7: Do you think it's But we think there's a strong

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Speaker 7: likelihood they make a one or two more times, so

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Speaker 7: the July meeting is very active.

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Speaker 1: All right, Natalie, thank you so much. We appreciate that.

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Speaker 1: Natalie Trevithick, head of investment grade credit Strategy at Payden

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Speaker 1: and Regal.

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Speaker 1: Hey, you're darn right. Focus on munis is brought to

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00:20:36,960 --> 00:20:40,639
Speaker 1: you by the New Deal, which created American infrastructure that

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Speaker 1: at leashed a new opportunity. Today we're doing it again

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00:20:43,160 --> 00:20:46,919
Speaker 1: with massive investment in modernizing our infrastructure and municipal bonds

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00:20:47,320 --> 00:20:50,560
Speaker 1: backed by Build America Mutual. They help make it happen.

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00:20:50,600 --> 00:20:53,640
Speaker 1: Invest in the future of America with BAM in short

425
00:20:53,920 --> 00:20:56,040
Speaker 1: bonds that I did my best. It's not nearly as

426
00:20:56,040 --> 00:20:58,640
Speaker 1: good as Matt Miller, but he was just walking by

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Speaker 1: and he knows it's Thursday. He knows it's eleven nine Friday.

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Speaker 1: He knows it's eleven oh nine, and he jumps right

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00:21:05,000 --> 00:21:07,200
Speaker 1: in because he knows that's time for muni's Joe Myisk

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Speaker 1: joins us here in the Bloomberg Interactive Brokers to studio.

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Speaker 1: He is the head of all our municipal research. Joe,

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Speaker 1: what's happening at there? We've got rates moving higher. What's

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Speaker 1: going on in the world of municipal bonds?

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Speaker 8: You know, we have a lot of stuff, But the

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Speaker 8: biggest news I think this week was we uh snapped

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Speaker 8: the sixteen week streak of outflows, outflows into municipal outflows

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Speaker 8: from municipal bond funds. We saw four and sixty million

438
00:21:31,720 --> 00:21:32,440
Speaker 8: come in this week.

439
00:21:32,720 --> 00:21:33,879
Speaker 4: It's the catalyst there.

440
00:21:34,880 --> 00:21:39,159
Speaker 8: We're getting higher yields, We're getting this this higher coupons

441
00:21:39,200 --> 00:21:42,920
Speaker 8: out there. There's also, let's face it, the relief from

442
00:21:43,080 --> 00:21:46,400
Speaker 8: the you know, the debt limit you know being passed.

443
00:21:47,000 --> 00:21:51,679
Speaker 8: So there there is that very much that you know,

444
00:21:51,800 --> 00:21:56,200
Speaker 8: things are it looks like things are. There's more it's

445
00:21:56,200 --> 00:21:58,360
Speaker 8: more constructive as the analysts.

446
00:21:58,400 --> 00:22:00,959
Speaker 1: Why were there so many we of outflows?

447
00:22:01,720 --> 00:22:05,000
Speaker 8: Oh, you know, there was everything to worry about. First

448
00:22:05,040 --> 00:22:08,879
Speaker 8: of all, you have the FED and there still is

449
00:22:08,960 --> 00:22:11,800
Speaker 8: uncertainty about the FED because you know, we're caring stories

450
00:22:11,800 --> 00:22:14,720
Speaker 8: about you know, FED is probably gonna uh you know

451
00:22:15,080 --> 00:22:20,560
Speaker 8: pause next week. Well perhaps not. So there's still a

452
00:22:20,600 --> 00:22:24,520
Speaker 8: lot of uncertainty in that area. Uh, And that's that

453
00:22:24,640 --> 00:22:28,080
Speaker 8: was the biggest reason for the outflows. There was also

454
00:22:28,720 --> 00:22:31,720
Speaker 8: you know, the debt limit's been hanging over the market

455
00:22:32,000 --> 00:22:36,600
Speaker 8: now for probably month and a half, two months, so

456
00:22:36,840 --> 00:22:39,280
Speaker 8: you know, between those two things, that's why people were

457
00:22:39,280 --> 00:22:43,520
Speaker 8: clearing out. And you know, two we had, you know,

458
00:22:44,280 --> 00:22:49,040
Speaker 8: you were getting loads of deals priced with two three percent,

459
00:22:49,240 --> 00:22:56,359
Speaker 8: four percent coupons, not exactly h enticing. But now fives

460
00:22:56,560 --> 00:22:58,880
Speaker 8: five and a half's we're kind of back to really

461
00:22:59,280 --> 00:23:02,000
Speaker 8: formula of and higher.

462
00:23:02,640 --> 00:23:03,600
Speaker 1: I gotta call my guys.

463
00:23:03,680 --> 00:23:04,320
Speaker 6: We're kind of back.

464
00:23:04,440 --> 00:23:06,560
Speaker 1: Jersey's coming out with any stuff that kind of cooping.

465
00:23:06,600 --> 00:23:07,720
Speaker 1: I'm jumping back in the market.

466
00:23:07,760 --> 00:23:10,600
Speaker 8: Oh yeah, but but now you know, five percent coupons

467
00:23:10,640 --> 00:23:14,160
Speaker 8: and you know we're in uh you know, I want

468
00:23:14,200 --> 00:23:18,159
Speaker 8: to say it's a it's a better place. Plus, you know,

469
00:23:18,720 --> 00:23:22,320
Speaker 8: right now, very little volume in our market. You know,

470
00:23:22,600 --> 00:23:25,240
Speaker 8: I think we're down. We're about one hundred and fifty billion,

471
00:23:25,320 --> 00:23:28,240
Speaker 8: which is off about twenty percent. And if you're talking

472
00:23:28,280 --> 00:23:32,040
Speaker 8: about number of Issues are probably off thirty percent. So

473
00:23:32,080 --> 00:23:34,720
Speaker 8: there's not exactly a lot of.

474
00:23:34,080 --> 00:23:36,600
Speaker 1: Pressure, is that because rates have gone up and Issues

475
00:23:36,640 --> 00:23:37,879
Speaker 1: don't want to sell those?

476
00:23:38,119 --> 00:23:38,239
Speaker 6: Right?

477
00:23:38,359 --> 00:23:40,400
Speaker 1: Yeah? But I thought, I thought the issues you've always

478
00:23:40,400 --> 00:23:41,800
Speaker 1: told us they don't care what they got to pay.

479
00:23:41,920 --> 00:23:43,880
Speaker 8: Well, they know if they have to come to market,

480
00:23:43,920 --> 00:23:46,639
Speaker 8: they'll come to market. But so many of them don't

481
00:23:46,680 --> 00:23:49,200
Speaker 8: have to come to market because they a lot of

482
00:23:49,240 --> 00:23:52,280
Speaker 8: them still have the COVID relief money, or a portion

483
00:23:52,400 --> 00:23:54,919
Speaker 8: of it. It still hasn't all been allocated.

484
00:23:55,200 --> 00:23:57,960
Speaker 4: So what about when we were talking about SVB and

485
00:23:58,040 --> 00:24:01,000
Speaker 4: when it came to that seven billion dollar Beauni portfolio

486
00:24:01,359 --> 00:24:05,360
Speaker 4: seen as basically requiring this sort of deep concession. What's

487
00:24:05,359 --> 00:24:05,960
Speaker 4: happening with that?

488
00:24:06,920 --> 00:24:10,119
Speaker 8: Well, I think it was black Rock is running the

489
00:24:10,359 --> 00:24:15,040
Speaker 8: UH is running the municipal bond auctions, and I know

490
00:24:15,080 --> 00:24:18,359
Speaker 8: they've sold off a good portion of that already. But

491
00:24:18,400 --> 00:24:21,800
Speaker 8: they're not gonna you know, they're gonna dole it out

492
00:24:21,840 --> 00:24:24,280
Speaker 8: a little at a time. You don't, uh, you know,

493
00:24:24,480 --> 00:24:26,920
Speaker 8: just say all I wants, Oh, here you go, mini market,

494
00:24:26,960 --> 00:24:29,439
Speaker 8: here's you know these billions for you. No, it's a

495
00:24:29,440 --> 00:24:33,320
Speaker 8: little bit. We'll dole it out that way. But you know,

496
00:24:33,359 --> 00:24:37,359
Speaker 8: as we quoted an analyst this week saying, uh, you know,

497
00:24:37,400 --> 00:24:40,960
Speaker 8: the banks were really caught holding a lot of low

498
00:24:41,040 --> 00:24:45,360
Speaker 8: coupon stuff, you know, two percent, three percent, and all

499
00:24:45,400 --> 00:24:48,679
Speaker 8: I took a big hit with the Fed, you know,

500
00:24:48,760 --> 00:24:50,840
Speaker 8: making its move the last couple of years.

501
00:24:51,160 --> 00:24:53,160
Speaker 1: All right, let's talk one of my favorite topics, which

502
00:24:53,160 --> 00:24:57,560
Speaker 1: is Las Vegas. Professional sports teams have been flocking there

503
00:24:57,600 --> 00:24:59,960
Speaker 1: over the last several years. First we had the hockey team.

504
00:25:00,080 --> 00:25:01,560
Speaker 1: I can't even think that at the end the finals,

505
00:25:01,600 --> 00:25:05,760
Speaker 1: I think, I don't know. And then I watched and

506
00:25:05,760 --> 00:25:10,080
Speaker 1: then football there the Raiders, and now the Oakland A's

507
00:25:10,560 --> 00:25:14,000
Speaker 1: are coming down. They need a stadium, Joe, and I'm

508
00:25:14,080 --> 00:25:17,440
Speaker 1: just guessing that this is going to require a little

509
00:25:17,440 --> 00:25:18,760
Speaker 1: bit of public financing.

510
00:25:18,920 --> 00:25:21,640
Speaker 8: Oh yeah, we have at least three hundred and eighty

511
00:25:21,680 --> 00:25:30,160
Speaker 8: million dollars in various subsidies and tax breaks and infrastructure

512
00:25:30,600 --> 00:25:34,840
Speaker 8: construction that are rolled in there. It's the total. I

513
00:25:34,880 --> 00:25:37,640
Speaker 8: think it's a one point five billion stadium. We've been

514
00:25:37,680 --> 00:25:38,119
Speaker 8: calling it.

515
00:25:38,800 --> 00:25:41,240
Speaker 6: And uh, this week.

516
00:25:41,119 --> 00:25:44,960
Speaker 8: We had Max Adler right about the Nevada lawmakers have

517
00:25:45,119 --> 00:25:50,160
Speaker 8: been called back into session second special session to discuss

518
00:25:50,240 --> 00:25:54,720
Speaker 8: the financing package for the as I I am in

519
00:25:54,800 --> 00:25:57,200
Speaker 8: no talent that this is going to pass. Yeah, because

520
00:25:57,280 --> 00:26:04,639
Speaker 8: Las Vegas is just such a.

521
00:26:01,840 --> 00:26:05,240
Speaker 1: They're printing money out there. I can't imagine this won't

522
00:26:05,240 --> 00:26:05,880
Speaker 1: get approved.

523
00:26:06,280 --> 00:26:09,200
Speaker 8: No, I I yeah, this is this is, This has gone.

524
00:26:09,000 --> 00:26:11,439
Speaker 4: Through any sort of timetable as far as when we

525
00:26:11,440 --> 00:26:12,720
Speaker 4: could find out when that may happen.

526
00:26:12,840 --> 00:26:15,640
Speaker 8: Oh, this is going to be uh you know, certainly

527
00:26:15,760 --> 00:26:19,280
Speaker 8: within the next couple of weeks. And then they you know,

528
00:26:19,400 --> 00:26:22,800
Speaker 8: set up the various parts of it, including the actual

529
00:26:22,840 --> 00:26:25,240
Speaker 8: bond issue, which I know that mister Sweeney.

530
00:26:24,840 --> 00:26:26,480
Speaker 1: Wants to got a part of totally. I mean, I'm

531
00:26:26,520 --> 00:26:28,560
Speaker 1: just looking. I've been to a couple of Yankee games

532
00:26:28,600 --> 00:26:33,040
Speaker 1: out in the Oakland Stadium. Man, that thing is ancient.

533
00:26:33,480 --> 00:26:36,760
Speaker 1: I mean it is rough, and nobody goes to those games.

534
00:26:36,760 --> 00:26:39,000
Speaker 1: It's not as bad as Tampa Bay maybe, but boy,

535
00:26:39,040 --> 00:26:41,080
Speaker 1: it is rough out there. But and it's for such

536
00:26:41,480 --> 00:26:44,280
Speaker 1: a great city. It's just brutal. But I think we're

537
00:26:44,320 --> 00:26:47,359
Speaker 1: finding out in that Bay Area market can't really support

538
00:26:47,400 --> 00:26:50,680
Speaker 1: two franchises, whether it's football, whether it's baseball.

539
00:26:51,320 --> 00:26:52,159
Speaker 4: That's what it looks like.

540
00:26:52,359 --> 00:26:54,480
Speaker 1: Yeah, but you know the Warriors, you know, they moved

541
00:26:54,560 --> 00:26:57,560
Speaker 1: to a great new arena, in downtown San Francisco, right

542
00:26:57,560 --> 00:26:59,760
Speaker 1: by the water, right by the pack Bell Park, which

543
00:26:59,800 --> 00:27:01,800
Speaker 1: is I'm not sure what it's called anymore, but so

544
00:27:01,840 --> 00:27:04,119
Speaker 1: that's a great area downtown San Francisco. But it looks like,

545
00:27:04,200 --> 00:27:06,040
Speaker 1: you know, the age, you're going to Vegas and the

546
00:27:06,040 --> 00:27:06,880
Speaker 1: public's gonna pay.

547
00:27:06,800 --> 00:27:07,400
Speaker 9: Up little bit here.

548
00:27:07,480 --> 00:27:09,360
Speaker 1: Oh yeah, and I think that I bet you those

549
00:27:09,359 --> 00:27:10,440
Speaker 1: bonds will be snapped up.

550
00:27:10,960 --> 00:27:15,080
Speaker 8: Oh easily. You know. In fact, I wrote about a

551
00:27:15,160 --> 00:27:21,720
Speaker 8: bond issue out today, call them out today for the

552
00:27:21,760 --> 00:27:27,480
Speaker 8: El Paso Chihuahuas. Whoa triple a El Pasoxes.

553
00:27:27,840 --> 00:27:29,200
Speaker 4: Yes they were.

554
00:27:29,200 --> 00:27:32,480
Speaker 8: They were going into the action today fifteen games back

555
00:27:32,600 --> 00:27:36,119
Speaker 8: in third place behind the Oklahoma City Dodgers.

556
00:27:37,400 --> 00:27:39,399
Speaker 1: So they're coming up with the bond deficiently.

557
00:27:39,520 --> 00:27:42,840
Speaker 8: Yeah, they sold bonds earlier on for dis service savings.

558
00:27:43,000 --> 00:27:46,199
Speaker 8: But could you imagine, you know, you get your you know,

559
00:27:46,240 --> 00:27:49,040
Speaker 8: you're making your way up in the minors, and and

560
00:27:49,320 --> 00:27:50,960
Speaker 8: you get to say, I'm a chiuaa cha.

561
00:27:52,080 --> 00:27:53,919
Speaker 1: All right, So how are the fund flows into muni's.

562
00:27:53,920 --> 00:27:55,359
Speaker 1: Are you talked to that that we have some funds

563
00:27:55,440 --> 00:27:57,560
Speaker 1: for the first time coming back in Do you expect

564
00:27:57,560 --> 00:28:01,399
Speaker 1: that to continue or one of the folks in the

565
00:28:01,400 --> 00:28:02,760
Speaker 1: market talking ylloid, I.

566
00:28:02,720 --> 00:28:06,840
Speaker 8: Would expect it to be coming back in now. And

567
00:28:07,160 --> 00:28:09,680
Speaker 8: you know, as I say, you have higher yields, there's

568
00:28:10,160 --> 00:28:14,760
Speaker 8: relief over the DEAT limit being passed, and you know

569
00:28:14,840 --> 00:28:17,920
Speaker 8: you do have year to date. I know you're always

570
00:28:17,760 --> 00:28:20,680
Speaker 8: as this performance over two percent.

571
00:28:20,560 --> 00:28:23,280
Speaker 1: Over two percent, and that's you know, and then you

572
00:28:23,320 --> 00:28:26,359
Speaker 1: get the tax adjustment there it's even better, say stuff.

573
00:28:26,400 --> 00:28:29,000
Speaker 8: So yeah, so I would expect that we're going to

574
00:28:29,040 --> 00:28:32,639
Speaker 8: see more inflows. And there's nothing on the horizon. I mean,

575
00:28:32,640 --> 00:28:36,320
Speaker 8: there's no big muni disaster on the horizon, you know

576
00:28:36,640 --> 00:28:38,520
Speaker 8: that throw people off the game.

577
00:28:38,560 --> 00:28:39,959
Speaker 1: All Right, I'm gonna call my guy to make sure

578
00:28:39,960 --> 00:28:42,320
Speaker 1: he's on the lookout for some new Jersey muni's I

579
00:28:42,400 --> 00:28:44,960
Speaker 1: like to say, coupons. I'm hearing about it exactly, Joe.

580
00:28:45,040 --> 00:28:48,719
Speaker 1: I guess what, No, that's it. That's it. The end

581
00:28:48,720 --> 00:28:51,040
Speaker 1: of our time together for this week. Joe Misich he

582
00:28:51,120 --> 00:28:55,240
Speaker 1: covers all things municipal bonds for Bloomberg Briefs for our

583
00:28:55,320 --> 00:28:58,600
Speaker 1: weekly update, which we always save for Friday. On the

584
00:28:58,680 --> 00:29:01,280
Speaker 1: municipal bond market against the host of return this year

585
00:29:01,320 --> 00:29:03,600
Speaker 1: after twenty twenty two, or the whole fixed income space

586
00:29:03,720 --> 00:29:06,840
Speaker 1: was just ravaged in terms of negative performance. We're going

587
00:29:06,960 --> 00:29:08,640
Speaker 1: more coming up. This is Bloomberg.

588
00:29:09,800 --> 00:29:13,200
Speaker 6: You're listening to the team Ken's our live program Bloomberg

589
00:29:13,280 --> 00:29:16,640
Speaker 6: Markets weekdays at ten am Eastern on Bloomberg dot Com,

590
00:29:16,720 --> 00:29:19,840
Speaker 6: the iHeartRadio app, and the Bloomberg Business App, or listen

591
00:29:19,920 --> 00:29:22,200
Speaker 6: on demand wherever you get your podcasts.

592
00:29:23,640 --> 00:29:26,640
Speaker 1: You know, just when we want to talk about the

593
00:29:26,680 --> 00:29:29,960
Speaker 1: worlds of technology and media coming together, we've got some

594
00:29:29,960 --> 00:29:30,920
Speaker 1: good people to talk to.

595
00:29:31,240 --> 00:29:32,960
Speaker 4: Want to see our next guest exactly.

596
00:29:33,000 --> 00:29:36,400
Speaker 1: Mark Dougas president's CEO of Mountain Joints, is here.

597
00:29:36,680 --> 00:29:36,920
Speaker 4: Hey.

598
00:29:37,120 --> 00:29:39,040
Speaker 1: Mark, I want to ask you about what, to me

599
00:29:39,240 --> 00:29:41,920
Speaker 1: has been one of the bigger news stories of this week,

600
00:29:42,240 --> 00:29:46,200
Speaker 1: which is the merger of the PGA Tour and Live Golf.

601
00:29:46,760 --> 00:29:49,080
Speaker 1: I mean, it just shocked the world of golf. It

602
00:29:49,160 --> 00:29:52,480
Speaker 1: shocked the people who follow the business of golf, and

603
00:29:52,520 --> 00:29:53,880
Speaker 1: I bet it was kind of a shock to some

604
00:29:53,920 --> 00:29:57,040
Speaker 1: of their media partners as well. What's your take from

605
00:29:57,080 --> 00:30:00,520
Speaker 1: your perspective and kind of the media slash tech zeitgeist.

606
00:30:02,000 --> 00:30:06,200
Speaker 9: Yeah, so, first thing, I think if you spend time

607
00:30:06,240 --> 00:30:10,000
Speaker 9: in the Middle East, I coincidentally have been in Dubai

608
00:30:10,080 --> 00:30:14,800
Speaker 9: for ten the last ten days and this part of

609
00:30:14,840 --> 00:30:18,480
Speaker 9: the world is just absolutely booming. It started with Dubai.

610
00:30:19,480 --> 00:30:24,040
Speaker 9: I actually went to Dohag Guitar this week, which is

611
00:30:24,120 --> 00:30:29,400
Speaker 9: also a much more traditional city than Guitar, but also booming.

612
00:30:29,440 --> 00:30:32,840
Speaker 9: The people there are very happy, at least everyone I

613
00:30:32,960 --> 00:30:36,680
Speaker 9: talked to was laughing and just really happy. And so

614
00:30:36,880 --> 00:30:40,719
Speaker 9: it's very different on the ground than the image I

615
00:30:40,720 --> 00:30:43,360
Speaker 9: think that folks have of the Middle East. And there's

616
00:30:43,360 --> 00:30:46,520
Speaker 9: been a lot of evolution over the last two decades,

617
00:30:46,560 --> 00:30:49,960
Speaker 9: and so Saudi Arabia is following that lead. All of

618
00:30:49,960 --> 00:30:53,760
Speaker 9: a sudden, it's becoming kind of trying to become a

619
00:30:53,840 --> 00:30:57,000
Speaker 9: tourism location. Obviously, I think for a lot of people

620
00:30:57,000 --> 00:30:59,640
Speaker 9: in America that's kind of like not the first place

621
00:30:59,680 --> 00:31:02,400
Speaker 9: that come the mind for where to go to a vacation,

622
00:31:02,520 --> 00:31:06,480
Speaker 9: but they, I think, are determined to spend literally hundreds

623
00:31:06,520 --> 00:31:10,440
Speaker 9: of billions of dollars to you know, kind of adjust

624
00:31:10,520 --> 00:31:15,160
Speaker 9: their cultures, their their image, and to make Saudi Arabia,

625
00:31:15,280 --> 00:31:17,360
Speaker 9: long with Dubai cant Are another city, is kind of

626
00:31:17,400 --> 00:31:19,600
Speaker 9: an attractive place to go. And I think this deal

627
00:31:20,240 --> 00:31:21,960
Speaker 9: the reason I said all that, I think this deal

628
00:31:22,120 --> 00:31:24,920
Speaker 9: is essentially a part of that, and in fact, the

629
00:31:25,040 --> 00:31:27,760
Speaker 9: amount of money involved in a deal is almost like

630
00:31:27,880 --> 00:31:31,320
Speaker 9: a rounding era in terms of the entire investment that

631
00:31:31,440 --> 00:31:34,880
Speaker 9: they're determined, Like there are single buildings in Dubai that

632
00:31:35,040 --> 00:31:38,959
Speaker 9: costs the value of this deal. So so, I mean,

633
00:31:39,080 --> 00:31:41,360
Speaker 9: I think it's great for the game of golf, Turning

634
00:31:41,400 --> 00:31:44,280
Speaker 9: golf into a you know, kind of more of a

635
00:31:44,360 --> 00:31:48,200
Speaker 9: team sport, making the players be a little less prize

636
00:31:48,840 --> 00:31:51,080
Speaker 9: oriented in terms of how they make money and more

637
00:31:51,200 --> 00:31:54,320
Speaker 9: kind of salary plus bonus oriented. I think it's great

638
00:31:54,360 --> 00:31:57,120
Speaker 9: for the players, and I think it's going to expand

639
00:31:57,200 --> 00:31:58,880
Speaker 9: the game. It's going to take some time, but I

640
00:31:58,920 --> 00:32:01,440
Speaker 9: think it's going to we turn this game into something

641
00:32:01,560 --> 00:32:05,160
Speaker 9: that a lot of people see as a more serious

642
00:32:05,200 --> 00:32:07,960
Speaker 9: sport for the people who are not currently followers of God.

643
00:32:08,200 --> 00:32:11,680
Speaker 1: What's the feeling, Yeah, well, what's the what's the feeling

644
00:32:11,720 --> 00:32:15,240
Speaker 1: over there? Mark from some of the negative response that

645
00:32:16,040 --> 00:32:19,200
Speaker 1: we've seen about just live golf in general, the role

646
00:32:19,440 --> 00:32:22,320
Speaker 1: of the Saudis and live Golf, and and some of

647
00:32:22,360 --> 00:32:25,280
Speaker 1: the feedback from even some big players like Roy McElroy

648
00:32:25,640 --> 00:32:28,440
Speaker 1: and and those that didn't have not to date supported

649
00:32:28,480 --> 00:32:30,080
Speaker 1: live what's the feeling over there in the Middle East

650
00:32:30,080 --> 00:32:30,360
Speaker 1: about that?

651
00:32:31,640 --> 00:32:31,840
Speaker 2: Yeah?

652
00:32:31,840 --> 00:32:34,479
Speaker 9: I think they, I think they understand it, but they

653
00:32:34,600 --> 00:32:39,560
Speaker 9: think that Americans are kind of looking in the past.

654
00:32:40,240 --> 00:32:42,840
Speaker 9: You know, most of like I said, the tourism here

655
00:32:42,880 --> 00:32:46,560
Speaker 9: and the people you see are more from Europe. You

656
00:32:46,640 --> 00:32:49,640
Speaker 9: don't really see a lot of American as many Americans

657
00:32:49,720 --> 00:32:53,960
Speaker 9: walking around. So I think they their perspective is, look,

658
00:32:54,040 --> 00:32:57,720
Speaker 9: we you know, we we we've blended our culture with

659
00:32:57,920 --> 00:33:01,800
Speaker 9: Western culture and and do so We've made ourselves way

660
00:33:01,880 --> 00:33:06,240
Speaker 9: more attractive to Europe and that will eventually happen to

661
00:33:06,360 --> 00:33:09,360
Speaker 9: America as they as they you know, like meet us

662
00:33:09,440 --> 00:33:13,760
Speaker 9: as individuals and realize that we are very friendly to

663
00:33:13,880 --> 00:33:16,600
Speaker 9: the to the rest of the world and not this

664
00:33:16,840 --> 00:33:18,680
Speaker 9: kind of extremist.

665
00:33:19,920 --> 00:33:21,680
Speaker 1: Image and actions.

666
00:33:21,760 --> 00:33:24,680
Speaker 9: You know, you can that that happened in the past.

667
00:33:24,800 --> 00:33:28,600
Speaker 9: So so I think they think time will will make

668
00:33:28,720 --> 00:33:32,040
Speaker 9: this work, and and they're patient, they're they're ready to

669
00:33:32,120 --> 00:33:34,440
Speaker 9: invest the time and the money to make it happen.

670
00:33:34,840 --> 00:33:37,640
Speaker 4: Since you work in the advertising software type space, what

671
00:33:37,720 --> 00:33:39,480
Speaker 4: do you think a deal like this could mean, particularly

672
00:33:39,560 --> 00:33:41,200
Speaker 4: for advertisers moving forward.

673
00:33:42,960 --> 00:33:46,160
Speaker 9: Yes, Well, all the big money in sports actually comes

674
00:33:46,240 --> 00:33:49,720
Speaker 9: from things like TV rights and when you talk to

675
00:33:49,880 --> 00:33:52,560
Speaker 9: like some of the biggest agencies, the biggest issue they

676
00:33:52,600 --> 00:33:56,840
Speaker 9: always have is getting more sports content. They want their

677
00:33:56,840 --> 00:34:00,600
Speaker 9: advertisers want to advertise against more sports. So I'm talking

678
00:34:00,720 --> 00:34:04,960
Speaker 9: like the WPPS and Group and and agent the big

679
00:34:05,040 --> 00:34:09,719
Speaker 9: agency holding companies. So you know, the sport needs to

680
00:34:10,160 --> 00:34:12,560
Speaker 9: kind of live up to the vision in the steel.

681
00:34:13,000 --> 00:34:17,960
Speaker 9: But I think people are very encouraged by one interesting thing.

682
00:34:18,280 --> 00:34:20,840
Speaker 9: We've been playing with a mound and this is almost

683
00:34:21,080 --> 00:34:23,799
Speaker 9: like just an internal project. We look at a golf

684
00:34:23,840 --> 00:34:25,319
Speaker 9: game and we look at and we go look at

685
00:34:25,360 --> 00:34:28,680
Speaker 9: all that advertising space, like it's just all that green

686
00:34:29,800 --> 00:34:33,160
Speaker 9: on the screen. And we've been we've been playing with

687
00:34:33,400 --> 00:34:36,279
Speaker 9: ads that just like like show up on the on

688
00:34:36,920 --> 00:34:41,120
Speaker 9: the lawn like just I think, so there's a lot

689
00:34:41,200 --> 00:34:43,640
Speaker 9: of fun you can have with the technology, like by

690
00:34:43,840 --> 00:34:46,799
Speaker 9: creating a space. But I think people anywhere you can

691
00:34:46,920 --> 00:34:49,920
Speaker 9: get more sports content to advertise against, you're gonna get

692
00:34:50,040 --> 00:34:54,919
Speaker 9: enthusiasm from advertisers. And that is you know where the big,

693
00:34:55,000 --> 00:34:58,200
Speaker 9: big money comes in sports. It's like the huge sports deals,

694
00:34:58,360 --> 00:35:01,040
Speaker 9: especially if golf starts to become more of a team

695
00:35:01,120 --> 00:35:03,680
Speaker 9: sport than less of a little less of an individual sport.

696
00:35:04,840 --> 00:35:08,440
Speaker 1: So to that end, I mean you're tight with the

697
00:35:08,480 --> 00:35:11,480
Speaker 1: advertising community, the tech community, the intersection of that type

698
00:35:11,520 --> 00:35:14,959
Speaker 1: of thing we had. Are you surprised we haven't seen

699
00:35:15,719 --> 00:35:19,040
Speaker 1: you know more, you know, a tech company of size

700
00:35:19,120 --> 00:35:21,520
Speaker 1: jump into the deep end of the pool and really

701
00:35:21,600 --> 00:35:25,320
Speaker 1: get into content. So for example, you know, try to

702
00:35:25,360 --> 00:35:28,120
Speaker 1: really bid for a major NFL package or Sunday package

703
00:35:28,200 --> 00:35:30,440
Speaker 1: or something like that. I think about like Amazon Prime

704
00:35:30,480 --> 00:35:33,680
Speaker 1: for example. You know, they've got a huge block of subscribers,

705
00:35:33,840 --> 00:35:37,280
Speaker 1: They've they've got you know, bottomless pit of of of money.

706
00:35:38,800 --> 00:35:41,320
Speaker 1: They're they're into the you know that the content business.

707
00:35:41,360 --> 00:35:44,560
Speaker 1: But what one could argue they're not in commensuratey size.

708
00:35:44,760 --> 00:35:45,480
Speaker 1: How do you think about that?

709
00:35:47,400 --> 00:35:52,800
Speaker 9: Yeah, I think the the economics on that are just

710
00:35:53,080 --> 00:35:56,040
Speaker 9: not very attractive. I mean, it makes sense for the

711
00:35:56,120 --> 00:35:59,560
Speaker 9: big content networks like an NBC and others to bid

712
00:35:59,640 --> 00:36:02,360
Speaker 9: on things like the Olympics and the bid on you

713
00:36:02,480 --> 00:36:05,879
Speaker 9: know kind of NFL and so forth. But I think

714
00:36:05,960 --> 00:36:10,279
Speaker 9: it's much harder to get Netflix. I think Netflix is

715
00:36:10,360 --> 00:36:13,239
Speaker 9: kind of one of the prime examples. They've never had

716
00:36:13,320 --> 00:36:16,000
Speaker 9: sports to my knowledge any right, well, what they've done

717
00:36:16,040 --> 00:36:17,960
Speaker 9: an end a round on sports. I just was on

718
00:36:18,239 --> 00:36:21,279
Speaker 9: I just literally locked into my Netflix account and they

719
00:36:21,360 --> 00:36:23,799
Speaker 9: have like they have Formula one. They you know, an

720
00:36:23,800 --> 00:36:27,800
Speaker 9: annual series. They now have one on bike racing, the

721
00:36:28,200 --> 00:36:30,839
Speaker 9: Tourder France, and so they've come into it at much

722
00:36:30,960 --> 00:36:36,080
Speaker 9: lower costs and ironically have helped expand those sports without

723
00:36:36,160 --> 00:36:38,840
Speaker 9: having to commit literally billions of dollars to do it.

724
00:36:38,960 --> 00:36:42,319
Speaker 9: I just don't think the economics fit. The economics at

725
00:36:42,360 --> 00:36:45,480
Speaker 9: tech companies typically love which is very high margin with

726
00:36:45,680 --> 00:36:49,520
Speaker 9: relatively low investment. So it's going to take some time

727
00:36:49,640 --> 00:36:52,520
Speaker 9: before they jumped into the content game, where it's very

728
00:36:52,640 --> 00:36:57,360
Speaker 9: high investment and arguably much much lower margin to you know,

729
00:36:57,600 --> 00:36:59,239
Speaker 9: high much higher risk to get there.

730
00:36:59,480 --> 00:37:02,760
Speaker 4: So the ad tier for Prime Video streaming service at Amazon,

731
00:37:02,840 --> 00:37:03,520
Speaker 4: that's going to be tough.

732
00:37:05,480 --> 00:37:08,080
Speaker 9: Yeah, I think Prime that I don't think that's much

733
00:37:08,120 --> 00:37:10,560
Speaker 9: of a news story. I mean the one of the last.

734
00:37:11,040 --> 00:37:13,320
Speaker 9: The thing about Prime the single biggest issue and that

735
00:37:13,440 --> 00:37:17,160
Speaker 9: this is coming directly from executives at Amazon, you know,

736
00:37:17,239 --> 00:37:19,920
Speaker 9: and conversations on that. The single biggest issue is most

737
00:37:19,960 --> 00:37:23,680
Speaker 9: prom subscribers don't know they have Prime Video. They just

738
00:37:23,840 --> 00:37:26,239
Speaker 9: literally don't know they got they got Prime because they

739
00:37:26,320 --> 00:37:31,160
Speaker 9: want fastest shipping and free shipping on every order they did,

740
00:37:31,280 --> 00:37:34,000
Speaker 9: and then it's and so they their single biggest issue

741
00:37:34,239 --> 00:37:38,880
Speaker 9: like the Prime does advertise the advertisement or the remind

742
00:37:39,000 --> 00:37:41,840
Speaker 9: you that you have access to Prime Video. So I

743
00:37:41,920 --> 00:37:46,200
Speaker 9: think so it's kind of a very unique situation. And

744
00:37:46,760 --> 00:37:50,279
Speaker 9: to a certain extent, I think that them having an

745
00:37:50,320 --> 00:37:53,640
Speaker 9: ad supported tier maybe as much as like you need

746
00:37:53,719 --> 00:37:56,000
Speaker 9: your subscribers to put some skin in the game for

747
00:37:56,280 --> 00:37:59,360
Speaker 9: the actual video, Like if you want them to know

748
00:37:59,440 --> 00:38:01,680
Speaker 9: they have it, they have to maybe pay for it,

749
00:38:02,680 --> 00:38:06,320
Speaker 9: you know. I think that's what they're paying for. So

750
00:38:06,480 --> 00:38:12,080
Speaker 9: I think Prime is just a very unusual content source,

751
00:38:12,200 --> 00:38:16,680
Speaker 9: and Amazon clearly watched offset some of the costs and

752
00:38:17,560 --> 00:38:22,480
Speaker 9: get more like knowledgeable adoption of Prime Video as opposed

753
00:38:22,520 --> 00:38:26,360
Speaker 9: to like this time is currently mostly passive adoption of it.

754
00:38:26,680 --> 00:38:28,520
Speaker 1: All right, Mark, always good to check in with you.

755
00:38:29,120 --> 00:38:31,040
Speaker 1: We appreciate you making a time all the way from

756
00:38:31,040 --> 00:38:34,680
Speaker 1: the Middle East. Mark Douglas, President and CEO of Mountain,

757
00:38:35,040 --> 00:38:40,080
Speaker 1: just talking about the confluence continued confluence of technology and media.

758
00:38:40,560 --> 00:38:43,600
Speaker 2: Thanks for listening to the Bloomberg Markets podcast. You can

759
00:38:43,680 --> 00:38:47,400
Speaker 2: subscribe and listen to interviews in Apple Podcasts or whatever

760
00:38:47,560 --> 00:38:51,160
Speaker 2: podcast platform you prefer. I'm Matt Miller. I'm on Twitter

761
00:38:51,480 --> 00:38:54,680
Speaker 2: at Matt Miller nineteen seventy three and on fall Sweeney.

762
00:38:54,719 --> 00:38:57,320
Speaker 1: I'm on Twitter at pt sweeney Before the podcast. You

763
00:38:57,400 --> 00:38:59,719
Speaker 1: can always catch us worldwide at Bloomberg Radio