1
00:00:05,800 --> 00:00:08,720
Speaker 1: Welcome to the Bloomberg p m L Podcast. I'm pim Fox.

2
00:00:08,760 --> 00:00:11,520
Speaker 1: Along with my co host Lisa Bramowitz. Each day we

3
00:00:11,640 --> 00:00:15,120
Speaker 1: bring you the most important, noteworthy, and useful interviews for

4
00:00:15,200 --> 00:00:17,840
Speaker 1: you and your money, whether you're at the grocery store

5
00:00:17,960 --> 00:00:20,720
Speaker 1: or the trading floor. Find the Bloomberg p m L

6
00:00:20,840 --> 00:00:33,720
Speaker 1: Podcast on Apple Podcasts, SoundCloud, and Bloomberg dot Com. Where

7
00:00:33,720 --> 00:00:35,960
Speaker 1: have we come from and where are we going? Within

8
00:00:36,080 --> 00:00:39,559
Speaker 1: the fixed income markets? Here to tell us Jeffrey Rosenberg,

9
00:00:39,680 --> 00:00:43,279
Speaker 1: chief fixed income strategist at black Rock, talking about their

10
00:00:44,520 --> 00:00:47,000
Speaker 1: mid year investment outlook. Jeffrey, thank you so much for

11
00:00:47,040 --> 00:00:50,240
Speaker 1: being with us. I want to start with a statistic

12
00:00:50,280 --> 00:00:53,760
Speaker 1: that got my attention that the trading range of the

13
00:00:53,840 --> 00:00:57,680
Speaker 1: tenure treasury yield is currently the narrowest that it's been

14
00:00:57,880 --> 00:01:00,760
Speaker 1: in more than four decades. In other words, it's not moving.

15
00:01:00,840 --> 00:01:03,560
Speaker 1: We have a flat line. Does this indicate that we're

16
00:01:03,560 --> 00:01:06,880
Speaker 1: about to break out with yields rising sharply or falling

17
00:01:06,920 --> 00:01:09,840
Speaker 1: sharply in the next few months, You know, it's an

18
00:01:09,840 --> 00:01:13,640
Speaker 1: interesting question. You're talking about the trend line of the

19
00:01:13,720 --> 00:01:17,039
Speaker 1: ten year interest rates and if we've had a breakout,

20
00:01:17,080 --> 00:01:20,080
Speaker 1: and if there's really a breakout to talk about. It's

21
00:01:20,120 --> 00:01:22,479
Speaker 1: not the ten year interest rate, It's it's what's happening

22
00:01:22,480 --> 00:01:25,360
Speaker 1: on the shorter end of the curve. And there, Uh,

23
00:01:25,440 --> 00:01:30,400
Speaker 1: you had had remarkably low volatility. How low you had

24
00:01:30,520 --> 00:01:34,039
Speaker 1: zero volatility because it was zero interest rate policy, and

25
00:01:34,120 --> 00:01:36,959
Speaker 1: so you had this anchoring of interest rates, and now

26
00:01:37,280 --> 00:01:41,120
Speaker 1: you're significantly breaking out. You have the two year well

27
00:01:41,160 --> 00:01:43,839
Speaker 1: above two and a half preyway. I'm sorry to break in, Jeffy,

28
00:01:44,040 --> 00:01:45,640
Speaker 1: but what I'm trying to figure out is the ten

29
00:01:45,720 --> 00:01:47,960
Speaker 1: year treasury out because as we are seeing more volatility

30
00:01:47,960 --> 00:01:50,440
Speaker 1: and a breakout and doubling of two year treasury yields

31
00:01:50,480 --> 00:01:52,880
Speaker 1: in the past year, I'm just wondering. I mean, people

32
00:01:52,880 --> 00:01:54,720
Speaker 1: are looking at that ten year benchmark is sort of

33
00:01:54,720 --> 00:01:56,760
Speaker 1: an indicator of global growth and of sort of the

34
00:01:57,200 --> 00:01:59,680
Speaker 1: view of the U. S economy right now and inflation,

35
00:02:00,040 --> 00:02:02,320
Speaker 1: and it's going nowhere, and I'm just wondering, what's the

36
00:02:02,400 --> 00:02:05,280
Speaker 1: setting us up for. Well, so where we're kind of

37
00:02:05,560 --> 00:02:08,360
Speaker 1: between me wanting to focus on the two year and

38
00:02:08,400 --> 00:02:11,079
Speaker 1: you wanting to focus on the tenure, we're ending up

39
00:02:11,120 --> 00:02:13,520
Speaker 1: talking about the yield curve, which I was hoping to

40
00:02:13,560 --> 00:02:15,520
Speaker 1: avoid because that's the only thing people want to talk about.

41
00:02:15,639 --> 00:02:17,960
Speaker 1: Let's talk about it because it's it's important. And so, yes,

42
00:02:18,080 --> 00:02:19,400
Speaker 1: you and I thought you were going to split the

43
00:02:19,440 --> 00:02:22,160
Speaker 1: difference and talk about the five year. We could do that.

44
00:02:23,120 --> 00:02:25,280
Speaker 1: We can certainly do that too, But there is a difference,

45
00:02:25,400 --> 00:02:27,320
Speaker 1: and and and the flattening has got a lot of

46
00:02:27,360 --> 00:02:29,880
Speaker 1: attention and and you know, one of the important points

47
00:02:29,880 --> 00:02:32,440
Speaker 1: and Powell raised this in his testimony, and the set

48
00:02:32,440 --> 00:02:33,919
Speaker 1: has been been talking about this for a while, and

49
00:02:33,919 --> 00:02:36,480
Speaker 1: it's important for the listeners because you know, people get

50
00:02:36,520 --> 00:02:39,480
Speaker 1: focused on the what's happening to the ten year and

51
00:02:39,520 --> 00:02:42,120
Speaker 1: the ten years going lower and the two years going higher?

52
00:02:42,360 --> 00:02:45,120
Speaker 1: And is that a sign of imminent recession? And the

53
00:02:45,240 --> 00:02:47,600
Speaker 1: level of the difference, which is part of your question,

54
00:02:47,639 --> 00:02:51,639
Speaker 1: you know, it's highly influenced. It's much lower in today's

55
00:02:51,760 --> 00:02:56,240
Speaker 1: environment because of the role of unconventional monetary policy that

56
00:02:56,400 --> 00:02:58,760
Speaker 1: is happening the world over. And so we want to

57
00:02:58,800 --> 00:03:02,440
Speaker 1: just take that level of the difference in the curve

58
00:03:02,520 --> 00:03:04,799
Speaker 1: and put a little asterix on it and say, yes,

59
00:03:04,880 --> 00:03:07,440
Speaker 1: it's important, but we also have to recognize it's very

60
00:03:07,520 --> 00:03:11,320
Speaker 1: different than what we've seen historically because of that unconventional

61
00:03:11,320 --> 00:03:15,520
Speaker 1: monetary policy. Quantitative easing the world over, which the point

62
00:03:15,560 --> 00:03:19,040
Speaker 1: of which was to flatten that relationship. So we want

63
00:03:19,080 --> 00:03:22,680
Speaker 1: to just sort of think about that. It decreases some

64
00:03:22,840 --> 00:03:25,720
Speaker 1: of the concerns, doesn't eliminate them, but it it takes

65
00:03:25,720 --> 00:03:28,160
Speaker 1: the temperature down a bit. Phim I hear what Jeffrey

66
00:03:28,240 --> 00:03:31,800
Speaker 1: is trying to say, very very politely, that yes, yield

67
00:03:31,800 --> 00:03:33,680
Speaker 1: curve matters, but perhaps not as much as it has

68
00:03:33,680 --> 00:03:38,000
Speaker 1: in the past. Jeffrey, I want to ask you about

69
00:03:38,440 --> 00:03:43,880
Speaker 1: liquidity and specifically the relationship between the rising value of

70
00:03:43,920 --> 00:03:48,160
Speaker 1: the US dollar, the repatriation of corporate profits that have

71
00:03:48,240 --> 00:03:57,000
Speaker 1: been sitting overseas, and any constraints on dollar funding. Any thoughts. Yeah, so, um, Well,

72
00:03:57,280 --> 00:04:00,720
Speaker 1: for first, the dollar strength is big deal. It's a

73
00:04:00,760 --> 00:04:04,400
Speaker 1: big story. We've seen this before. It's an important development,

74
00:04:04,400 --> 00:04:08,960
Speaker 1: and you're seeing part of that about growth differentials the US.

75
00:04:09,200 --> 00:04:12,040
Speaker 1: We're gonna get second quarter GDP next week. In the

76
00:04:12,120 --> 00:04:17,160
Speaker 1: first iteration, you see the tracking estimates somewhere up towards

77
00:04:17,320 --> 00:04:20,240
Speaker 1: five percent. That's not a sustainable level, but the U

78
00:04:20,320 --> 00:04:23,600
Speaker 1: s economy is powering ahead and the rest of the

79
00:04:23,640 --> 00:04:26,200
Speaker 1: world's economies are not doing so well. Part of that

80
00:04:26,279 --> 00:04:29,120
Speaker 1: economic growth of confidence again he heard it from Powell

81
00:04:29,360 --> 00:04:33,680
Speaker 1: that just re emphasizes the outlook that US interest rates

82
00:04:33,839 --> 00:04:38,240
Speaker 1: are going to continue an upward drift. UH short interest rates,

83
00:04:38,279 --> 00:04:41,599
Speaker 1: the Fed policy rates, and that interest rate differential to

84
00:04:41,640 --> 00:04:45,120
Speaker 1: the rest of the world is another factor behind dollar strength.

85
00:04:45,200 --> 00:04:49,560
Speaker 1: One factor that is not behind dollar strength is repatriation.

86
00:04:49,839 --> 00:04:56,919
Speaker 1: It's a very misunderstood notion that repatriating UH foreign corporate

87
00:04:56,960 --> 00:05:01,839
Speaker 1: earnings results in dollar perch just is and the source

88
00:05:01,880 --> 00:05:05,560
Speaker 1: of the misunderstanding is that most of the foreign held

89
00:05:06,279 --> 00:05:10,240
Speaker 1: UH earnings are held in dollars. The notion of them

90
00:05:10,240 --> 00:05:13,680
Speaker 1: being foreign is not the currency, but rather the legal entity,

91
00:05:13,800 --> 00:05:16,760
Speaker 1: and so it doesn't really create a bid for for

92
00:05:16,760 --> 00:05:19,000
Speaker 1: for dollars. So that's a little bit misunderstood. The big

93
00:05:19,480 --> 00:05:22,600
Speaker 1: fundamental drivers behind the dollar appreciation, there's really those two

94
00:05:22,640 --> 00:05:25,080
Speaker 1: that growth in that intra st rate piece. So Jeffrey,

95
00:05:25,080 --> 00:05:26,480
Speaker 1: look into the Chrystal ball for us, what do you

96
00:05:26,520 --> 00:05:28,080
Speaker 1: think is going to be the best performing asset the

97
00:05:28,120 --> 00:05:31,360
Speaker 1: fixed income world in the second half. You know, It's

98
00:05:31,400 --> 00:05:34,480
Speaker 1: where I was kind of taking the conversation. We we

99
00:05:34,680 --> 00:05:37,680
Speaker 1: really like the front end of the yield curve, so

100
00:05:37,760 --> 00:05:41,440
Speaker 1: we're talking about shorter maturities. I'll bracket that one of

101
00:05:41,480 --> 00:05:44,080
Speaker 1: the three year kind of maturities. You can leak out

102
00:05:44,080 --> 00:05:47,040
Speaker 1: the curve a little bit, but as you do, duration

103
00:05:47,160 --> 00:05:49,520
Speaker 1: starts to perhaps become a little bit of a drag.

104
00:05:49,600 --> 00:05:51,760
Speaker 1: And if I add a bit of investment grade credit,

105
00:05:51,960 --> 00:05:54,159
Speaker 1: where spreads of widen and we and we don't see

106
00:05:54,160 --> 00:05:57,159
Speaker 1: a lot of credit risk in the next six months.

107
00:05:57,200 --> 00:06:00,320
Speaker 1: To undermine that outlook, you're looking at three three and

108
00:06:00,320 --> 00:06:04,479
Speaker 1: a half kind of yields. That's on an annual basis um,

109
00:06:04,560 --> 00:06:06,560
Speaker 1: so certainly six months returns will be lower than that,

110
00:06:06,600 --> 00:06:10,080
Speaker 1: but that will probably be one of the best performing

111
00:06:10,080 --> 00:06:12,520
Speaker 1: asset classes, and it's certainly one of the areas we

112
00:06:12,520 --> 00:06:15,360
Speaker 1: we think is the most attractive in the fixed income universe.

113
00:06:16,200 --> 00:06:18,640
Speaker 1: Jeff Rosenberg, thank you very much for being with us.

114
00:06:18,720 --> 00:06:21,600
Speaker 1: Jeff Rosenberg is the chief fixed income strategist for a

115
00:06:21,640 --> 00:06:26,200
Speaker 1: black Rock Investment Institute, giving us details about the black

116
00:06:26,320 --> 00:06:49,960
Speaker 1: Rocksen midyear investment outlook. Helsinki Summit trade negotiations Russians. Let's

117
00:06:49,960 --> 00:06:54,000
Speaker 1: bring in Richard Kahn. He is managing partner of Eurasia Advisors,

118
00:06:54,720 --> 00:06:58,240
Speaker 1: formally serving as an advisor to major Russian companies for

119
00:06:58,279 --> 00:07:03,120
Speaker 1: initial public offerings, also sourcing financing for Russian real estate

120
00:07:03,160 --> 00:07:06,520
Speaker 1: development of fluent Russian speaker, so he has a background

121
00:07:06,520 --> 00:07:09,680
Speaker 1: and understanding exactly the relationship between the United States and

122
00:07:09,720 --> 00:07:12,760
Speaker 1: Russia on a business level as well as politics. Richard,

123
00:07:12,800 --> 00:07:15,480
Speaker 1: thank you very much for coming into this studio. What

124
00:07:15,640 --> 00:07:19,160
Speaker 1: can you tell us based on your experience about the

125
00:07:19,240 --> 00:07:23,400
Speaker 1: Russian reaction to the Helsinki Summit. I think from the

126
00:07:23,480 --> 00:07:28,640
Speaker 1: Russian perspective, they are truly thrilled. They witnessed the our

127
00:07:28,720 --> 00:07:32,800
Speaker 1: goalie continually kicking the ball into his own goal. Um.

128
00:07:32,880 --> 00:07:35,920
Speaker 1: And I think at some point they're probably concerned that

129
00:07:36,720 --> 00:07:38,640
Speaker 1: people on the team are gonna wonder whose side he

130
00:07:38,720 --> 00:07:42,240
Speaker 1: is on. But from their perspective, this has been a

131
00:07:42,240 --> 00:07:47,040
Speaker 1: a major propaganda victory for Putin himself. He cemented control

132
00:07:47,080 --> 00:07:49,320
Speaker 1: in Russia and nobody there can possibly take him on.

133
00:07:49,360 --> 00:07:50,920
Speaker 1: At this stage. He has a free hand to go

134
00:07:51,000 --> 00:07:55,120
Speaker 1: after the opposition. But more importantly, they see the weakness

135
00:07:55,120 --> 00:07:57,640
Speaker 1: of the US. They see that, you know, what Trump

136
00:07:57,680 --> 00:07:59,960
Speaker 1: has done has put us at odds with our ally,

137
00:08:00,040 --> 00:08:01,680
Speaker 1: as is shown, he's not going to stand up for

138
00:08:01,680 --> 00:08:04,720
Speaker 1: our values. Um. All of that is is a huge

139
00:08:04,720 --> 00:08:07,960
Speaker 1: win for Russia as they try to assert greater leadership

140
00:08:07,960 --> 00:08:10,360
Speaker 1: in the Middle East and in the world generally. So

141
00:08:10,520 --> 00:08:13,440
Speaker 1: President Trump has said repeatedly it's good for the US

142
00:08:13,480 --> 00:08:16,040
Speaker 1: to have a constructive relationship with Russia or the two

143
00:08:16,080 --> 00:08:21,800
Speaker 1: biggest nuclear superpowers. We don't want war. Was anything achieved

144
00:08:21,880 --> 00:08:26,000
Speaker 1: that was positive for the US in the summit? Well,

145
00:08:26,040 --> 00:08:29,679
Speaker 1: first of all, I I fully agree with those goals personally,

146
00:08:29,720 --> 00:08:32,680
Speaker 1: we and I've spent my life working to help resolve

147
00:08:32,800 --> 00:08:34,840
Speaker 1: issues between Russia and the US and to bring the

148
00:08:34,840 --> 00:08:38,720
Speaker 1: countries closer together. But that's a long term process. It

149
00:08:38,760 --> 00:08:41,480
Speaker 1: has to be based on reality and on a recognition

150
00:08:41,520 --> 00:08:44,240
Speaker 1: of our different values. And that's what your age advisors

151
00:08:44,280 --> 00:08:47,240
Speaker 1: is about as well. Uh. And every president I think

152
00:08:47,679 --> 00:08:49,480
Speaker 1: you know, and certainly since the Cold War, has been

153
00:08:49,480 --> 00:08:53,280
Speaker 1: trying to achieve that too. Uh. But I never heard

154
00:08:53,320 --> 00:08:56,720
Speaker 1: anything articulated by this current president in terms of what

155
00:08:56,840 --> 00:08:59,760
Speaker 1: his goals actually were in the summit, other than saying

156
00:08:59,760 --> 00:09:03,079
Speaker 1: he wanted to have low expectations. Um. I think his

157
00:09:03,160 --> 00:09:05,560
Speaker 1: goals were achieved, which was to have a one on

158
00:09:05,559 --> 00:09:09,880
Speaker 1: one communication with his co conspirator regarding what took place

159
00:09:10,200 --> 00:09:12,280
Speaker 1: during the election, and to figure out how to handle

160
00:09:12,320 --> 00:09:15,360
Speaker 1: things now in a manner that helps Trump protect himself

161
00:09:17,200 --> 00:09:21,280
Speaker 1: give us some idea of the actual strength and weaknesses

162
00:09:21,559 --> 00:09:26,920
Speaker 1: of the Russian economy. Look, the base aggression economy is

163
00:09:26,960 --> 00:09:30,120
Speaker 1: out of of an oil and gas state. It has

164
00:09:30,200 --> 00:09:34,600
Speaker 1: other natural resources, but uh, the best way to think

165
00:09:34,640 --> 00:09:37,720
Speaker 1: of it is that although it tries to expand into

166
00:09:37,760 --> 00:09:42,640
Speaker 1: other areas, including high tech industries, it doesn't have the

167
00:09:42,679 --> 00:09:47,679
Speaker 1: infrastructure legally and culturally to allow people to safely invest

168
00:09:48,559 --> 00:09:52,320
Speaker 1: and develop businesses. Uh. So it really is run more

169
00:09:52,440 --> 00:09:55,080
Speaker 1: like a what I would call either a medieval empire

170
00:09:55,200 --> 00:09:57,920
Speaker 1: or a mafia state, where certain assets are of the

171
00:09:57,960 --> 00:10:02,800
Speaker 1: state are controlled by clicks and those who cooperate with

172
00:10:02,880 --> 00:10:07,800
Speaker 1: them do well, and the rest are either eliminated in

173
00:10:07,960 --> 00:10:13,120
Speaker 1: some fashion or they are basically, um invited to leave

174
00:10:13,120 --> 00:10:15,760
Speaker 1: the country. You're allowed to leave a country. So, Richard,

175
00:10:15,800 --> 00:10:17,320
Speaker 1: I want to go back to something you said that

176
00:10:17,920 --> 00:10:22,080
Speaker 1: President Trump was meeting with his quote co conspirator, Uh,

177
00:10:22,280 --> 00:10:25,480
Speaker 1: with respect to what happened during the Russian election. Obviously

178
00:10:25,520 --> 00:10:27,920
Speaker 1: this has not been proven yet. Uh. This is very

179
00:10:28,000 --> 00:10:31,400
Speaker 1: much what Robert Muller is investigating. So we don't know

180
00:10:31,480 --> 00:10:34,440
Speaker 1: that for a fact in any way. UM, But I

181
00:10:34,480 --> 00:10:36,760
Speaker 1: do want to get to something, which is the broader

182
00:10:36,760 --> 00:10:39,520
Speaker 1: political implication of this where you have a hardening of

183
00:10:39,559 --> 00:10:43,680
Speaker 1: people who are anti the president, who are trying to say, look,

184
00:10:43,720 --> 00:10:45,880
Speaker 1: this just shows that he's not fit for office. And

185
00:10:45,880 --> 00:10:48,120
Speaker 1: then you have a supporters coming out and saying, look,

186
00:10:48,120 --> 00:10:51,120
Speaker 1: he's trying to create peace. Uh, you don't have anything

187
00:10:51,240 --> 00:10:54,560
Speaker 1: on him yet. At some point this will come to

188
00:10:54,640 --> 00:10:58,360
Speaker 1: a head. The sides are getting increasingly angry and agitated,

189
00:10:58,400 --> 00:11:00,600
Speaker 1: and I'm trying to figure out, you know, what's the

190
00:11:00,760 --> 00:11:04,400
Speaker 1: risk that we have some kind of dnue mall that

191
00:11:04,520 --> 00:11:09,400
Speaker 1: is somewhat damaging on many levels here. Well, look, first,

192
00:11:09,640 --> 00:11:14,000
Speaker 1: you know, I make that statement regarding co conspiracy because

193
00:11:14,000 --> 00:11:16,120
Speaker 1: I think one we saw some of that playing out

194
00:11:16,520 --> 00:11:19,400
Speaker 1: in the summit itself. I also think there is plenty

195
00:11:19,400 --> 00:11:21,880
Speaker 1: of evidence of that in emails and other communications that

196
00:11:21,880 --> 00:11:23,840
Speaker 1: took place during the campaign, as well as in the

197
00:11:23,840 --> 00:11:26,280
Speaker 1: indictments that we've seen. I think it's going to be

198
00:11:26,320 --> 00:11:30,640
Speaker 1: extremely difficult for Trump and his supporters to contend that

199
00:11:30,720 --> 00:11:32,840
Speaker 1: he was not at the very least of where and

200
00:11:32,960 --> 00:11:37,320
Speaker 1: receiving support and conjunction with the campaign and cooperating with that.

201
00:11:38,320 --> 00:11:40,240
Speaker 1: But look, of course we're gonna wait for the Muller

202
00:11:40,280 --> 00:11:43,839
Speaker 1: indictments to come down and We'll see how all those

203
00:11:43,880 --> 00:11:45,679
Speaker 1: play out and what all the details are. But I've

204
00:11:45,679 --> 00:11:48,880
Speaker 1: certainly seen enough and have lived a life involved with

205
00:11:48,960 --> 00:11:51,480
Speaker 1: Russia to know what this is about at this stage.

206
00:11:51,480 --> 00:11:54,040
Speaker 1: And I see the conduct of our president and giving

207
00:11:54,120 --> 00:11:58,520
Speaker 1: up critical US positions and also undermining our country and

208
00:11:58,559 --> 00:12:01,880
Speaker 1: our alliances, all all serving as I see, at the

209
00:12:01,920 --> 00:12:05,559
Speaker 1: interests only of Russia in this um So where does

210
00:12:05,559 --> 00:12:09,439
Speaker 1: this play out look? There will always be people who

211
00:12:09,800 --> 00:12:12,840
Speaker 1: will pay attention only to the tweets from this president

212
00:12:13,360 --> 00:12:16,960
Speaker 1: and will take his side. UH. The Russians are also

213
00:12:17,120 --> 00:12:20,760
Speaker 1: very effective at building additional support, whether it's through the

214
00:12:20,880 --> 00:12:24,400
Speaker 1: n r A, religious organizations are the groups to support

215
00:12:24,480 --> 00:12:27,560
Speaker 1: this president. I am very concerned that at the end

216
00:12:27,600 --> 00:12:30,839
Speaker 1: of the day, regardless of what happens, he is going

217
00:12:30,880 --> 00:12:33,200
Speaker 1: to take things right to the line in terms of

218
00:12:33,280 --> 00:12:36,920
Speaker 1: undermining our institutions, as long as he doesn't cross over

219
00:12:36,960 --> 00:12:39,920
Speaker 1: it to the point where he's obviously acting in a

220
00:12:39,960 --> 00:12:42,400
Speaker 1: traitor of his fashion. That's what happened at the summit,

221
00:12:42,440 --> 00:12:46,560
Speaker 1: where he was pushing and pushing, trying to appease and

222
00:12:46,720 --> 00:12:50,280
Speaker 1: UH and please the Russians and protect himself by doing that.

223
00:12:50,760 --> 00:12:53,400
Speaker 1: But he got the backlash and realized that, Boy, I've

224
00:12:53,440 --> 00:12:56,240
Speaker 1: gone over the line now and my base is starting

225
00:12:56,240 --> 00:12:58,800
Speaker 1: to see who I really am, what I'm really about.

226
00:12:59,320 --> 00:13:01,120
Speaker 1: So I think it the end of the day, Uh,

227
00:13:01,559 --> 00:13:04,320
Speaker 1: we will probably find ourselves in a position where we

228
00:13:04,400 --> 00:13:08,319
Speaker 1: have strong indictments coming down and we're at that point

229
00:13:08,360 --> 00:13:11,760
Speaker 1: going to face I think some real issues about the

230
00:13:11,840 --> 00:13:15,079
Speaker 1: strength of our of our institutions in dealing with the President,

231
00:13:15,120 --> 00:13:17,920
Speaker 1: who I do not think, Uh, we'll hold back and

232
00:13:17,960 --> 00:13:21,199
Speaker 1: doing anything you possibly can to maintain power. Do you

233
00:13:21,240 --> 00:13:26,520
Speaker 1: have any comments on the idea that their Germans are

234
00:13:26,559 --> 00:13:32,079
Speaker 1: held captive by the new pipeline, the North Stream to

235
00:13:32,240 --> 00:13:37,160
Speaker 1: pipeline that would bring natural gas to Germany from Russia

236
00:13:37,200 --> 00:13:39,880
Speaker 1: that the President alluded to. I do have a view

237
00:13:39,880 --> 00:13:43,960
Speaker 1: on that. In my experience, Andrew Merkel and her team

238
00:13:44,040 --> 00:13:48,679
Speaker 1: have integrity and ethics, and I think that they understand

239
00:13:48,720 --> 00:13:51,520
Speaker 1: that although they have to have dealings with Russia, that

240
00:13:51,520 --> 00:13:54,440
Speaker 1: that does not mean that they need to give up

241
00:13:54,480 --> 00:13:58,360
Speaker 1: their ethical framework in terms of how they deal with Russia. Uh.

242
00:13:58,480 --> 00:14:02,079
Speaker 1: Having said that, I understand and that UH, certainly the

243
00:14:02,480 --> 00:14:05,920
Speaker 1: creating alternatives to the pipeline, you know, it might be

244
00:14:05,960 --> 00:14:09,320
Speaker 1: a good idea in terms of diminishing Russia's influence. But

245
00:14:09,400 --> 00:14:12,240
Speaker 1: that's just a again more of a business type of issue.

246
00:14:12,280 --> 00:14:16,120
Speaker 1: I'm not worried about that German leadership becoming like like

247
00:14:16,360 --> 00:14:20,200
Speaker 1: our current leadership. Richard thirty seconds. Russia's horde of US

248
00:14:20,240 --> 00:14:24,040
Speaker 1: treasuries plummeted in two months, ended in the end of May. Uh.

249
00:14:24,080 --> 00:14:27,960
Speaker 1: Do you know why I wouldn't. I wouldn't say that.

250
00:14:28,000 --> 00:14:31,120
Speaker 1: I know why. I have my suspicions why I think

251
00:14:31,160 --> 00:14:33,520
Speaker 1: that there is concerned that there's going to be a

252
00:14:33,600 --> 00:14:39,080
Speaker 1: greater round of sanctions against Russia. I think that, Uh,

253
00:14:39,120 --> 00:14:42,400
Speaker 1: there's a point at which Putin and Trump and those

254
00:14:42,440 --> 00:14:46,320
Speaker 1: around Trump are are overplaying their hand and they have

255
00:14:46,440 --> 00:14:48,440
Speaker 1: to expect to backlash. And we saw some of that

256
00:14:48,480 --> 00:14:52,560
Speaker 1: backlash after the summit. Richard Khn. We could go on

257
00:14:52,880 --> 00:14:55,840
Speaker 1: four hours, Richard con managing partner of eur Asia Advisors,

258
00:14:56,280 --> 00:14:59,520
Speaker 1: joining us on the fallout from the Russia U S

259
00:14:59,520 --> 00:15:18,840
Speaker 1: summit by President Trump and President of Vladimir Putin in

260
00:15:18,880 --> 00:15:23,760
Speaker 1: focus today very much the Chinese un It's been falling dramatically.

261
00:15:23,760 --> 00:15:28,240
Speaker 1: Today's fall is accelerating against the dollar now at the lowest,

262
00:15:28,280 --> 00:15:31,640
Speaker 1: the weakest versus the green back in about a year.

263
00:15:31,720 --> 00:15:33,880
Speaker 1: Joining US now is win Thin Global Head of Emerging

264
00:15:33,880 --> 00:15:36,560
Speaker 1: Markets ffx UH and when we're so glad that you

265
00:15:36,560 --> 00:15:39,760
Speaker 1: could join us. This is really an important story for today.

266
00:15:39,840 --> 00:15:44,920
Speaker 1: How concerned should investors be about this decline? And frame

267
00:15:44,920 --> 00:15:46,840
Speaker 1: it for us? Is this a is this a tool

268
00:15:46,880 --> 00:15:50,240
Speaker 1: in the trade war? Is this? Uh? Something more significant

269
00:15:50,280 --> 00:15:53,040
Speaker 1: about a slowdown in the Chinese economy and easing to

270
00:15:53,080 --> 00:15:57,280
Speaker 1: respond to it? Well, first all, thanks for having It's

271
00:15:57,280 --> 00:16:00,200
Speaker 1: always a pleasure. Um. There's lots of lots of of

272
00:16:00,480 --> 00:16:03,560
Speaker 1: factors rolling the markets right now. But I'm gonna try

273
00:16:03,560 --> 00:16:05,440
Speaker 1: and be the sort of voice of reason and say, look,

274
00:16:06,080 --> 00:16:08,320
Speaker 1: there a lot of things to worry about, but Chinese

275
00:16:08,360 --> 00:16:10,520
Speaker 1: evaluations is simply just not one of the major things

276
00:16:10,560 --> 00:16:14,280
Speaker 1: we should be worried about. Um. Why is that? Well? Look, um,

277
00:16:14,360 --> 00:16:16,800
Speaker 1: if the longest time over the year's last several years,

278
00:16:16,800 --> 00:16:20,320
Speaker 1: not decades, the US UH I m F also the

279
00:16:20,320 --> 00:16:23,600
Speaker 1: Western powers of press China to give a greater market

280
00:16:23,680 --> 00:16:26,720
Speaker 1: role to the exchange rate and lo and behold that's

281
00:16:26,720 --> 00:16:29,840
Speaker 1: what we're seeing. If you look at the UM You're

282
00:16:30,080 --> 00:16:32,000
Speaker 1: wonderful w c RS page. If you look over the

283
00:16:32,040 --> 00:16:35,720
Speaker 1: last twelve months, UM, the Chinese want is actually one

284
00:16:35,720 --> 00:16:38,200
Speaker 1: of the better uh, performing EM currencies. So if you

285
00:16:38,200 --> 00:16:40,520
Speaker 1: look at year to date, it's smacked in the middle

286
00:16:40,520 --> 00:16:43,720
Speaker 1: of the impact, down four percent year to date. My

287
00:16:43,880 --> 00:16:46,480
Speaker 1: view and as and as this for a long time,

288
00:16:46,560 --> 00:16:49,040
Speaker 1: is that that the recent weakness and you want to

289
00:16:49,120 --> 00:16:53,160
Speaker 1: simply reflecting a broad based dollar rally, EM sell off,

290
00:16:53,240 --> 00:16:55,520
Speaker 1: it's it's really trading with the rest of EM and

291
00:16:55,560 --> 00:16:57,280
Speaker 1: I think that's the sort of what we should be saying.

292
00:16:57,280 --> 00:17:01,840
Speaker 1: It's it's more market based, uh more UM being driven

293
00:17:01,880 --> 00:17:05,320
Speaker 1: by by global factors. Could you speak a little bit

294
00:17:05,440 --> 00:17:09,560
Speaker 1: about the shadow banking system that exists in China and

295
00:17:09,640 --> 00:17:12,480
Speaker 1: the efforts on the part of the Chinese government to

296
00:17:12,560 --> 00:17:17,080
Speaker 1: try to spur economic growth, specifically among small and medium

297
00:17:17,200 --> 00:17:21,720
Speaker 1: sized businesses. Yeah, you know, listen, this is you know,

298
00:17:21,880 --> 00:17:23,840
Speaker 1: we have seen this kind of going back and forth

299
00:17:23,880 --> 00:17:26,159
Speaker 1: for the last several years. So you know, look, we

300
00:17:26,200 --> 00:17:30,520
Speaker 1: know I mentioned the factors going on. China's particulous juggling

301
00:17:30,520 --> 00:17:33,760
Speaker 1: a lot of balls. Uh. They're trying to deal with

302
00:17:33,800 --> 00:17:37,560
Speaker 1: the slowdown and economy as well as sort of stresses

303
00:17:37,600 --> 00:17:39,240
Speaker 1: in the financial sector, and they've been trying to de

304
00:17:39,359 --> 00:17:42,000
Speaker 1: leverage the last several quarters. The time that we always

305
00:17:42,000 --> 00:17:45,280
Speaker 1: see is when they try and deleverage loan. Behold the

306
00:17:45,520 --> 00:17:48,440
Speaker 1: constats weekend, they get nervous and they start pushing UH

307
00:17:48,760 --> 00:17:51,800
Speaker 1: loan growth up again. So it's sort of like two

308
00:17:51,840 --> 00:17:54,880
Speaker 1: steps forward, one step back my bottom lines. I think

309
00:17:54,920 --> 00:17:56,760
Speaker 1: that you know, it's it's a sort of black box.

310
00:17:56,800 --> 00:18:00,359
Speaker 1: The financial system is understressed. We've had just had a

311
00:18:00,480 --> 00:18:03,919
Speaker 1: huge I think the fault UM one of the Chinese issuers.

312
00:18:03,960 --> 00:18:06,320
Speaker 1: I think you guys carry that story overnight. Right Well,

313
00:18:06,520 --> 00:18:09,879
Speaker 1: they're they're like twenty they've been twenty corporate bond the

314
00:18:09,880 --> 00:18:13,639
Speaker 1: faults so far in the No. I mean interestingly, I

315
00:18:13,680 --> 00:18:15,159
Speaker 1: think we want to see that cost EM. You know,

316
00:18:15,200 --> 00:18:17,280
Speaker 1: it's not just China, you know, EM and Channel took

317
00:18:17,320 --> 00:18:20,840
Speaker 1: advantage of low barring cost globally. They issued debt like

318
00:18:20,880 --> 00:18:23,400
Speaker 1: there's no tomorrow and now sort of the it's time

319
00:18:23,440 --> 00:18:26,880
Speaker 1: to pay the piper. So, Um, do I think there's

320
00:18:26,880 --> 00:18:29,280
Speaker 1: gonna be a systemic problem. No. I think that the

321
00:18:29,320 --> 00:18:31,960
Speaker 1: system is in stresses, But I don't see something sort

322
00:18:32,000 --> 00:18:34,760
Speaker 1: of huge sort of uh leave a moment for for

323
00:18:34,800 --> 00:18:37,560
Speaker 1: the China or for for the global economy. Um, when

324
00:18:37,600 --> 00:18:40,560
Speaker 1: I understand what you're saying with respect to China being

325
00:18:40,800 --> 00:18:42,880
Speaker 1: sort of lumped in with the rest of emerging markets,

326
00:18:42,880 --> 00:18:44,440
Speaker 1: and that its currency is actually one of the better

327
00:18:44,440 --> 00:18:50,679
Speaker 1: performers against developed marker competitors, or basically appears. But what

328
00:18:50,760 --> 00:18:54,640
Speaker 1: I'm struggling with is China is the world's second biggest economy.

329
00:18:54,880 --> 00:18:58,280
Speaker 1: It can't really be lumped in with much lesser economies

330
00:18:58,320 --> 00:19:01,000
Speaker 1: based on how significant it is for the world economy.

331
00:19:01,000 --> 00:19:03,880
Speaker 1: And meanwhile, you have the trade war or at least

332
00:19:03,880 --> 00:19:06,960
Speaker 1: the threat of an escalating trade or with the US,

333
00:19:07,200 --> 00:19:11,480
Speaker 1: and China is uh easing policies. It's sort of backtracking

334
00:19:11,520 --> 00:19:13,480
Speaker 1: on some of the tightening that had done based on

335
00:19:13,520 --> 00:19:15,560
Speaker 1: what you were talking about and pain was talking about.

336
00:19:15,800 --> 00:19:18,400
Speaker 1: I guess what I'm trying to understand is because as

337
00:19:18,440 --> 00:19:21,680
Speaker 1: you were saying, China such a black box. Could this

338
00:19:21,920 --> 00:19:25,200
Speaker 1: be that China's economy is slowing much more than official

339
00:19:25,280 --> 00:19:27,560
Speaker 1: data are letting on and they feel the need to

340
00:19:27,560 --> 00:19:31,720
Speaker 1: reverse policy now to counter that, Well, you know, we

341
00:19:31,800 --> 00:19:33,440
Speaker 1: go back to the age old debate. But how reliable

342
00:19:33,440 --> 00:19:35,560
Speaker 1: are there Chinese data? And something I've always looked at

343
00:19:35,680 --> 00:19:39,000
Speaker 1: as more qualitative assessment. Look, we know, maybe it's not

344
00:19:39,040 --> 00:19:42,000
Speaker 1: really growing tacks and um, but we can't sort of

345
00:19:42,400 --> 00:19:44,359
Speaker 1: use benchmarks as well it's it's a little bit slower

346
00:19:44,359 --> 00:19:47,000
Speaker 1: than was a year ago, you know, and so comparedive

347
00:19:47,160 --> 00:19:51,959
Speaker 1: of uh matters now you know to me, um, and

348
00:19:52,000 --> 00:19:54,440
Speaker 1: you're right that because it's such a large economy, it

349
00:19:54,440 --> 00:19:56,200
Speaker 1: does take a special place in that sense. It makes

350
00:19:56,200 --> 00:19:58,080
Speaker 1: me believe that they will not do anything that's going

351
00:19:58,080 --> 00:20:00,840
Speaker 1: to upset or the royal markets. You know, we saw

352
00:20:00,840 --> 00:20:04,000
Speaker 1: that back in the talks fifteen they devalued and uh,

353
00:20:04,119 --> 00:20:07,200
Speaker 1: not only the domestic investors flee and we had to

354
00:20:07,280 --> 00:20:09,159
Speaker 1: you know, had cap ouphas out of China, but you know,

355
00:20:09,760 --> 00:20:13,320
Speaker 1: the developed markets emerge, other emerging marketstop markets really felt

356
00:20:13,359 --> 00:20:16,440
Speaker 1: the pain. And I think China doesn't want to go

357
00:20:16,480 --> 00:20:18,080
Speaker 1: down that path again. You know, they've seen that it's

358
00:20:18,080 --> 00:20:22,119
Speaker 1: a very dangerous path to go through again. They're already, um,

359
00:20:22,160 --> 00:20:24,320
Speaker 1: you know, dealing with all sorts of different stresses in

360
00:20:24,359 --> 00:20:26,680
Speaker 1: the economy. I think some sort of currency crisis is

361
00:20:27,000 --> 00:20:28,320
Speaker 1: sort of the last thing they want to deal with

362
00:20:28,400 --> 00:20:32,040
Speaker 1: right now. So again, I don't see the human lines

363
00:20:32,080 --> 00:20:33,800
Speaker 1: out of line, out of you know, sort of out

364
00:20:33,840 --> 00:20:36,600
Speaker 1: of line with the moves of the rest of the world. Um.

365
00:20:36,640 --> 00:20:39,520
Speaker 1: I think they will continue to manage the currency. Remember,

366
00:20:39,560 --> 00:20:42,240
Speaker 1: it's not a floating currency. It's managed currency, but they'll

367
00:20:42,280 --> 00:20:44,439
Speaker 1: manage it within these parameters and that will they'll prevent

368
00:20:44,520 --> 00:20:47,720
Speaker 1: any sort of mass hysterical move of some sort. And

369
00:20:47,800 --> 00:20:50,919
Speaker 1: in global markets, can you do Turkey and twenty seconds

370
00:20:51,000 --> 00:20:55,560
Speaker 1: or less? H yes, I would stay stay away. Um.

371
00:20:55,600 --> 00:20:58,320
Speaker 1: You know we had Urdwan when he was VICTI, but

372
00:20:58,359 --> 00:21:00,000
Speaker 1: he put his soun in law in charge of the treasury.

373
00:21:00,000 --> 00:21:03,800
Speaker 1: In finance industry, E clipped the central bank independence. So

374
00:21:03,840 --> 00:21:05,840
Speaker 1: it's going down to pastoral, which I think is bad.

375
00:21:06,320 --> 00:21:10,040
Speaker 1: Next week we're very tunneling. Central bank meets inflation jumped

376
00:21:10,119 --> 00:21:11,680
Speaker 1: up in June. They need to hike at least a

377
00:21:11,720 --> 00:21:13,800
Speaker 1: hundred fifty basis points. Let's see if they do it

378
00:21:13,800 --> 00:21:15,439
Speaker 1: and they don't, I think we go back up. We

379
00:21:15,680 --> 00:21:19,480
Speaker 1: take dollar you want to dollar era above five? He

380
00:21:19,560 --> 00:21:22,760
Speaker 1: did it. Win Thin, Global Head of Emerging Markets FX

381
00:21:23,160 --> 00:21:26,800
Speaker 1: speaking to us about the Chinese yuan and the Turkish lira.

382
00:21:27,320 --> 00:21:43,879
Speaker 1: He's with Brown Brothers Harriman the Future of healthcare and

383
00:21:43,960 --> 00:21:47,359
Speaker 1: healthcare costs. Joining us now is Susan Duvore, the chief

384
00:21:47,400 --> 00:21:51,560
Speaker 1: executive of Premier Inc. They are based in Charlotte, North Carolina.

385
00:21:51,640 --> 00:21:54,480
Speaker 1: Susan joins us here in our eleven three, Oh studios.

386
00:21:54,720 --> 00:21:58,439
Speaker 1: Thank you very much for being here. Before we begin

387
00:21:58,640 --> 00:22:01,000
Speaker 1: in this sort of general content next of what's happening

388
00:22:01,000 --> 00:22:04,280
Speaker 1: with healthcare and healthcare pricing. Could you just offer an

389
00:22:04,280 --> 00:22:07,000
Speaker 1: example of some of the work that you're doing, and

390
00:22:07,040 --> 00:22:11,480
Speaker 1: I'm thinking most recently maybe of the Physician Enterprise Collaborative

391
00:22:12,200 --> 00:22:16,160
Speaker 1: and how Premiere works with healthcare providers, because I think

392
00:22:16,200 --> 00:22:21,040
Speaker 1: it's more than thirty eight hundred hospitals around the country. Yeah,

393
00:22:21,080 --> 00:22:24,560
Speaker 1: so Premiere works with plus and a hundred fifty other

394
00:22:24,600 --> 00:22:27,800
Speaker 1: providers like doctors, nursing home, surgery centers, this kind of thing.

395
00:22:28,280 --> 00:22:32,320
Speaker 1: Think about us as a national network of providers, the

396
00:22:32,480 --> 00:22:36,760
Speaker 1: people delivering healthcare to patients um and we are in

397
00:22:36,880 --> 00:22:41,040
Speaker 1: infrastructure to help them lower their costs, improve their quality,

398
00:22:41,080 --> 00:22:45,160
Speaker 1: improve their safety, improve their outcomes. And so in the

399
00:22:45,240 --> 00:22:49,800
Speaker 1: pharma world, for example, we aggregate their buying of drugs,

400
00:22:49,880 --> 00:22:54,679
Speaker 1: We create competitive friction between suppliers, and the inflation in

401
00:22:54,800 --> 00:22:57,600
Speaker 1: the cost of drugs that we help them negotiate is

402
00:22:57,640 --> 00:23:01,080
Speaker 1: half what the industry inflation is. So that's an example

403
00:23:01,240 --> 00:23:03,199
Speaker 1: of how Premiere works and what we're trying to do

404
00:23:03,240 --> 00:23:06,639
Speaker 1: with these health care systems. We do similar things where

405
00:23:06,680 --> 00:23:10,359
Speaker 1: we help them improve their safety, you know, lowering infection

406
00:23:10,480 --> 00:23:14,560
Speaker 1: rates in hospitals, lowering mortality in hospitals. And so it's

407
00:23:14,600 --> 00:23:17,320
Speaker 1: two sides of an equation, which is a cost reduction

408
00:23:17,359 --> 00:23:20,960
Speaker 1: side and a quality improvement side. So uh, we had

409
00:23:20,960 --> 00:23:23,280
Speaker 1: some guests on a few weeks ago who are talking

410
00:23:23,280 --> 00:23:27,480
Speaker 1: about the Indian UH system healthcare system and how the

411
00:23:27,560 --> 00:23:30,359
Speaker 1: U S could learn something from the hub, hub and

412
00:23:30,520 --> 00:23:33,280
Speaker 1: spokesmodel that they have where they have hubs that really

413
00:23:33,320 --> 00:23:36,480
Speaker 1: specialize in specific services and that are experts and then

414
00:23:36,760 --> 00:23:40,000
Speaker 1: the spokes that kind of provide provide the other services.

415
00:23:40,400 --> 00:23:43,560
Speaker 1: Have you ever recommended to any of your clients you guys,

416
00:23:43,880 --> 00:23:47,920
Speaker 1: this whole center should probably be shrunk immensely or are

417
00:23:48,040 --> 00:23:52,120
Speaker 1: cut uh and really rely more on these people for services.

418
00:23:52,160 --> 00:23:54,520
Speaker 1: What's your thought on that? Yeah, when you think about

419
00:23:54,520 --> 00:23:57,560
Speaker 1: the evolution of the health care system, Premiere has systems

420
00:23:57,560 --> 00:24:00,320
Speaker 1: of all kinds around the country. A lot of them

421
00:24:00,359 --> 00:24:03,679
Speaker 1: are integrated delivery systems. They are hub and spoke, but

422
00:24:03,760 --> 00:24:06,600
Speaker 1: we may have more of them in a market than

423
00:24:06,720 --> 00:24:09,719
Speaker 1: we long term need. And so the real question is

424
00:24:09,760 --> 00:24:13,880
Speaker 1: how do we take the services and optimize the volume

425
00:24:13,920 --> 00:24:18,080
Speaker 1: and optimize the cost performance and optimize the quality outcomes.

426
00:24:18,280 --> 00:24:20,680
Speaker 1: But yeah, we have we have a lot of markets

427
00:24:20,720 --> 00:24:25,600
Speaker 1: that have moved into that integrated delivery system model. Several

428
00:24:25,720 --> 00:24:30,400
Speaker 1: large pharmaceutical companies such as Novartis and Viser have said

429
00:24:30,440 --> 00:24:34,399
Speaker 1: that they are going to freeze drug prices. This seems

430
00:24:34,440 --> 00:24:37,800
Speaker 1: to be in response to the tweets and the comments

431
00:24:37,840 --> 00:24:41,159
Speaker 1: by President Donald Trump. Do you think that that's an

432
00:24:41,160 --> 00:24:45,880
Speaker 1: effective way to manage healthcare pricing? You know, I actually

433
00:24:46,000 --> 00:24:50,399
Speaker 1: think that the Drug Blueprint and Scott Gottlieb and the

434
00:24:50,480 --> 00:24:53,520
Speaker 1: things that he's trying to push forward with the administration

435
00:24:53,680 --> 00:24:57,560
Speaker 1: are things that are pointed in the right direction. Speed

436
00:24:57,640 --> 00:25:00,240
Speaker 1: up the approval of generics, get rid of some of

437
00:25:00,240 --> 00:25:03,479
Speaker 1: the loopholes for extending the life of a branded drug company.

438
00:25:03,560 --> 00:25:06,919
Speaker 1: I don't think anybody just saying we're going to freeze

439
00:25:06,960 --> 00:25:09,000
Speaker 1: prices for a period of time. I mean, the truth

440
00:25:09,080 --> 00:25:13,000
Speaker 1: is you've got to have market forces and competition every day,

441
00:25:13,040 --> 00:25:17,720
Speaker 1: all the time UM to actually have a sustainable, UM,

442
00:25:17,760 --> 00:25:21,440
Speaker 1: you know, managing factor for drug pricing. Do you think

443
00:25:21,440 --> 00:25:23,920
Speaker 1: that Medicare should play a more active role in negotiating

444
00:25:24,280 --> 00:25:28,800
Speaker 1: with pharmaceutical We think at Premier that Medicare should continue

445
00:25:28,840 --> 00:25:33,040
Speaker 1: to implement these value based payment programs. So you take

446
00:25:33,080 --> 00:25:35,919
Speaker 1: the delivery system, you have them own the risk of

447
00:25:35,960 --> 00:25:38,920
Speaker 1: the total cost of the patient, and then you create

448
00:25:39,119 --> 00:25:42,400
Speaker 1: you allow for market forces and competition to have the

449
00:25:42,480 --> 00:25:45,040
Speaker 1: health care system try to lower the cost of the

450
00:25:45,080 --> 00:25:48,120
Speaker 1: care that they're delivering to patients. We think the government

451
00:25:48,240 --> 00:25:52,520
Speaker 1: directly intervening in the decisions about which drugs at what

452
00:25:52,600 --> 00:25:56,639
Speaker 1: price patients will have access to will be will be

453
00:25:56,760 --> 00:26:01,080
Speaker 1: very problematic. Okay, But if the government is the one

454
00:26:01,119 --> 00:26:06,479
Speaker 1: that's ultimately paying the bill, shouldn't the payer be allowed

455
00:26:06,520 --> 00:26:10,320
Speaker 1: to negotiate prices, particularly when they are such a big

456
00:26:11,160 --> 00:26:13,439
Speaker 1: force in the market. You know, the last time I

457
00:26:13,480 --> 00:26:15,000
Speaker 1: was on the show, which was about a month ago,

458
00:26:15,160 --> 00:26:21,199
Speaker 1: I talked about employers getting directly involved with providers and

459
00:26:21,320 --> 00:26:24,040
Speaker 1: consumers in the cost of healthcare. So, if you think

460
00:26:24,080 --> 00:26:27,840
Speaker 1: about Medicare, Medicare is a payer, they are the implement

461
00:26:27,960 --> 00:26:31,320
Speaker 1: or of and they are in a sense the employer

462
00:26:31,400 --> 00:26:35,720
Speaker 1: too because these are Medicare, these are Medicare patients. So yes,

463
00:26:35,800 --> 00:26:38,359
Speaker 1: we think that they should be directly involved, but we

464
00:26:38,400 --> 00:26:40,359
Speaker 1: think the way that they ought to do it is

465
00:26:40,400 --> 00:26:44,800
Speaker 1: to go directly to the provider delivery system because that's

466
00:26:44,800 --> 00:26:46,879
Speaker 1: where the decisions are being made, and that's where you

467
00:26:46,960 --> 00:26:50,440
Speaker 1: want the decisions to be made. So create models that

468
00:26:50,440 --> 00:26:54,639
Speaker 1: that take that provider system and help them manage the

469
00:26:54,680 --> 00:26:57,440
Speaker 1: cost of the care. You know, a month ago I said,

470
00:26:57,440 --> 00:27:00,280
Speaker 1: I thought employers were getting a lot more active. Since then,

471
00:27:01,000 --> 00:27:03,719
Speaker 1: we've got JP Morgan, Amazon in Berkshire who've hired now

472
00:27:03,760 --> 00:27:07,400
Speaker 1: they're CEO. You've got a coalition of employers who are

473
00:27:07,440 --> 00:27:11,040
Speaker 1: now attacking some of the high cost procedures. Amazon bought

474
00:27:11,040 --> 00:27:15,119
Speaker 1: pill Pack. Amazon bought pill Pack. Amazon is reportedly talking

475
00:27:15,160 --> 00:27:18,560
Speaker 1: to ex Health and so these are all initiatives that say,

476
00:27:19,600 --> 00:27:23,000
Speaker 1: maybe there's an insurance company in the middle of this

477
00:27:23,800 --> 00:27:27,359
Speaker 1: that that actually isn't lowering the cost of healthcare and

478
00:27:27,480 --> 00:27:30,280
Speaker 1: isn't delivering the best clinical outcomes. I think the same

479
00:27:30,359 --> 00:27:32,960
Speaker 1: is true for the medicare world, and maybe it'll be

480
00:27:33,000 --> 00:27:36,919
Speaker 1: disintromedd it disintermediated. Unfortunately we have to leave there. Susan Divore,

481
00:27:37,280 --> 00:27:38,760
Speaker 1: thank you so much. We love having you on. It's

482
00:27:38,760 --> 00:27:41,520
Speaker 1: an important perspective. This is an important industry to keep tracking,

483
00:27:41,600 --> 00:27:45,000
Speaker 1: especially given all of the pressure to try to make

484
00:27:45,080 --> 00:27:48,320
Speaker 1: it more efficient to deliver healthcare in the US. Susan Divore,

485
00:27:48,359 --> 00:27:51,679
Speaker 1: chief executive Officer of Premier Inc. Normally based in Charlotte,

486
00:27:51,680 --> 00:27:53,439
Speaker 1: North Carolina, but joining us here in our eleven three

487
00:27:53,480 --> 00:27:59,280
Speaker 1: oh studios in New York. Thanks for listening to the

488
00:27:59,280 --> 00:28:02,520
Speaker 1: Bloomberg an L podcast. You can subscribe and listen to

489
00:28:02,560 --> 00:28:07,080
Speaker 1: interviews at Apple Podcasts, SoundCloud, or whatever podcast platform you prefer.

490
00:28:07,480 --> 00:28:11,080
Speaker 1: I'm pim Fox. I'm on Twitter at pim Fox. I'm

491
00:28:11,119 --> 00:28:14,400
Speaker 1: on Twitter at Lisa Abramo wits one. Before the podcast,

492
00:28:14,440 --> 00:28:17,040
Speaker 1: you can always catch us worldwide on Bloomberg Radio