Speaker 1: This is Bloomberg Business Wait inside from the reporters and
Speaker 1: editors who bring you America's most trusted business magazine, plus
Speaker 1: global business, finance and tech news. The Bloomberg Business Week
Speaker 1: Podcast with Carol Messer and Tim Stenebeck from Bloomberg Radio.
Speaker 2: It is day four, heading into day five since the
Speaker 2: surprise Hamas attack on Israel, and in today's Bloomberg Big Take,
Speaker 2: Bloomberg News Israel bureau chief who we talked to yesterday,
Speaker 2: Ethan Brauner, writes about a nation in which a political
Speaker 2: divisions have really driven anti government protesters into the streets
Speaker 2: for nine months. That's been the backdrop ahead of this
Speaker 2: and that have now those divisions have now vanished in
Speaker 2: the face of Hamasa's slaughter at the weekend and fears
Speaker 2: that the conflict could spread to Lebanon. You know, we
Speaker 2: see that this right tim often tough times, conflict can
Speaker 2: often bring divided sides together.
Speaker 3: The question is, I think how long this lasts, especially
Speaker 3: in a government that has been divided divided for such
Speaker 3: a long time. With more on how the nation has
Speaker 3: come together and yet the risks that still face it's
Speaker 3: politically challenged and questioned. Prime Minister Benjamin net and Yahoo.
Speaker 3: We've got Bloomberg News economy and government reporter Khalat Alstein
Speaker 3: joining us on Zoom from Tel Aviv right now. Ghalat,
Speaker 3: good to have you with us. First of all, I
Speaker 3: just want to say thanks for joining us, especially so
Speaker 3: late and in a time that you know, people are
Speaker 3: so concerned about their security in Tel Aviv. Just just
Speaker 3: give us an idea of what you're experiencing right now,
Speaker 3: what you're seeing, and really what you're doing, so as.
Speaker 4: You're asking me on a personal note. So yeah, So,
Speaker 4: actually Tel Aviv has also been targeted over the past
Speaker 4: four days. I live in a very northern vicinity of
Speaker 4: Tel Aviv, so I think it's a little less targeted
Speaker 4: than other parts of the city. But we did have
Speaker 4: two missile alerts today, had to go down to the
Speaker 4: bomb shelter. It is now around ten to thirty pm here,
Speaker 4: so there were they were saying on the news a
Speaker 4: bit earlier that missiles were expected to be shot at
Speaker 4: Tel Aviv at nine pm. That didn't happen up till now,
Speaker 4: but some people are still, you know, waiting to see
Speaker 4: if that happens. And that's basically what's going on on
Speaker 4: the ground here in Tel Aviv.
Speaker 3: Ugalie are you are you? Is it to the point
Speaker 3: where you're you know, the missiles are coming and they're
Speaker 3: being intercepted by the Iron Dome defense system.
Speaker 4: So yes, hopefully so it is. You know, as you
Speaker 4: probably will know, this is a very efficient system that
Speaker 4: that Israel has you know, made up and built and
Speaker 4: has made operational. But it does, you know, miss sometimes
Speaker 4: so but most of the times it's it's pretty accurate
Speaker 4: and it does an amazing job at intercepting the missiles.
Speaker 2: Yes, you know, in covering it yesterday here certainly at
Speaker 2: Bloomberg and during our live broadcast were some of the
Speaker 2: headlines that came out of Benjamin not in Yahoo's evening
Speaker 2: televised address the Prime Minister of course and talking about
Speaker 2: unifying government. Tell us about remind our world about the
Speaker 2: backdrop that's been Israel for the last nine or ten months.
Speaker 4: Yeah so so. Benjamin Ataniel, who's Israel's longest ever reigning
Speaker 4: prime minister, came back to power at the very end
Speaker 4: of last year, at the very end of December last year,
Speaker 4: and he put together a governing coalition that is constituted
Speaker 4: of very far right nationalist parties and Orthodox parties, Jewish
Speaker 4: Orthodox parties, making that the I think, you know, you
Speaker 4: can say that that is like the most some would
Speaker 4: say the most right leaning government Israel has ever had.
Speaker 4: Some would say it is the most extreme government the
Speaker 4: Israel has ever had. And on that backdrop, after the
Speaker 4: government transformed, just as Justice Ministerry live Levine, who was
Speaker 4: a member of Benjamin Ataniella's party that he could, came
Speaker 4: out and put out an announcement that he is initiating
Speaker 4: a judicial overhaul which was basically meant to weaken the
Speaker 4: power of courts, mainly the Supreme Court Israel Supreme Court,
Speaker 4: and that immediately brought on very intense public protests that
Speaker 4: went on until last Saturday. So it went on for
Speaker 4: forty weeks straight. It got bigger and bigger as time
Speaker 4: went by and the weeks went on, and it turned
Speaker 4: out to be the biggest protest movement that Israel had
Speaker 4: ever seen. And the division was very, very big, and
Speaker 4: you know, it was felt everywhere because I think that
Speaker 4: in my perception and I think many will tell you
Speaker 4: that that at some point it went away beyond the
Speaker 4: controversial judicial overhaul, which is always at the foundation of
Speaker 4: things but you know, it was a very big opposition
Speaker 4: to Nathaniel's government because a lot of other things that
Speaker 4: they were trying to pass through in Parliament and in
Speaker 4: other ways that a big part of the public very
Speaker 4: much resented.
Speaker 2: Here, It's safe to say his political future was much
Speaker 2: in question now as he seeks a more unified government,
Speaker 2: and you understand why everyone would be rallying, you know,
Speaker 2: behind unification, or at least everybody kind of on the
Speaker 2: same mission, if you will, in terms of any kind
Speaker 2: of retaliation. Does it change the political course of Benjamin
Speaker 2: net and Yahoo?
Speaker 4: Not necessarily. I mean, I don't think so. You know,
Speaker 4: there's been a lot of dog that's being pushed back,
Speaker 4: both by Israeli officials, Israeli politicians, leaders, and also by
Speaker 4: some you know, people in the general public. So there's
Speaker 4: been a big pushback, you know on the questions of
Speaker 4: you know, how this even happened, right, I mean, it's
Speaker 4: it's pretty amazing that that that even happened to a
Speaker 4: country like Israel.
Speaker 2: Is he being held responsible for that? Within sight? What's
Speaker 2: what's the conversations that you you are hearing there in
Speaker 2: industry all about his responsibility for missing on the intelligence
Speaker 2: side of things.
Speaker 4: So you know, some people are saying that he has
Speaker 4: a big part in it. You know, obviously most people
Speaker 4: think that there was you know, an intelligence failure here,
Speaker 4: but there is talk about you know, first of all,
Speaker 4: him being responsible for for everything that goes on as
Speaker 4: Prime minister, and also that pressure that the government had
Speaker 4: put for instance, to shift military powers from the Gaza
Speaker 4: area to the West Bank, for instance, to secure settlements,
Speaker 4: especially during the Jewish holidays that they were just you
Speaker 4: know coming to an end just last Saturday. So so
Speaker 4: so they're also saying, you know, it's so so it's
Speaker 4: not just his overall responsibility for the situation, but actually,
Speaker 4: you know, some some things that were brought on by
Speaker 4: his government, by their policies, by you know how much
Speaker 4: they wanted to go towards the settlements, you know, and
Speaker 4: allow them to do things in the West Bank that
Speaker 4: needed a lot of security. So so, yes, he is
Speaker 4: being blamed for this.
Speaker 3: So I just want to clarify. I just want to clarify.
Speaker 3: Are you saying focusing and instead of focusing on the
Speaker 3: border with Gaza, potentially moving resources from that area to
Speaker 3: the West Bank.
Speaker 4: Yes, that is that is part of the conversation here
Speaker 4: in Israel. I want to be clear that it is not,
Speaker 4: you know, one hundred percent of the conversation that everyone
Speaker 4: is saying this, and even the people are saying this,
Speaker 4: you know, are not saying that this is you know,
Speaker 4: one hundred percent to you know, he's one hundred percent
Speaker 4: to be blamed for what happened. But there is talk
Speaker 4: about the specific point that I was just talking about
Speaker 4: that because they wanted to allow settlers in Judean and
Speaker 4: Samaria to have all these ceremonies and all these events
Speaker 4: during the Jewish holiday season, they did move some military powers.
Speaker 4: They did shift them to the West Bank, and this
Speaker 4: left Gaza a little bears, as you know, in relevance
Speaker 4: to what is usually over there in terms of military powers.
Speaker 2: Just got about a minute or so left, forty five seconds, goalie,
Speaker 2: I can't even imagine, you know, to be in your shoes.
Speaker 2: What are you thinking at this point as you look
Speaker 2: at out towards the rest of the week.
Speaker 4: Well, you know, if you listen to the rhetoric of
Speaker 4: everyone you know who's been speaking to US leaders, idea
Speaker 4: of officials, they're speaking about a very very long military
Speaker 4: operation that's coming ahead and there's a big question if
Speaker 4: Lebanon will be joininge and Lebanon will be joining in.
Speaker 4: And this is you know, this is causing a lot
Speaker 4: of concern. I'm speaking now, you know, of the civilians
Speaker 4: of the general public in Israel, because you know, when
Speaker 4: there was a war in Israel, then the public is
Speaker 4: targeted by missiles, and when you look at Prisbella, there
Speaker 4: are a much bigger threats in that sense than come us.
Speaker 4: So you know, people are concerned, and you know, it's
Speaker 4: pretty clear that we're looking at something that's going to
Speaker 4: be very long, ongoing weeks, maybe months, and we have
Speaker 4: to see how it plays out.
Speaker 2: Yeah, and this is something we talked about yesterday. I
Speaker 2: think somebody referred to it as Iranian proxies? Was it
Speaker 2: Lebanon and some other areas in terms of as this
Speaker 2: size and scope may expand out. Khaleat, stay safe and
Speaker 2: thank you so much. Galita Alstein on zoom from Tel Aviv,
Speaker 2: of course, Bloomberg News Economy and Government Reporter.
Speaker 1: You're listening to the Bloomberg Business Week podcast. Catch us
Speaker 1: live weekday afternoons from three to six Eastern Listen on
Speaker 1: Bloomberg dot com. The iHeartRadio app and the Bloomberg Business
Speaker 1: app or watch us live on YouTube.
Speaker 2: That ipo for burken Stock pricing at forty six dollars
Speaker 2: a share, coming from Wall Street Journal. It was a
Speaker 2: range of forty four to forty nine. So just to
Speaker 2: give an eye da in there point right, they were
Speaker 2: looking different. Raised about one point six billions. It'll be
Speaker 2: a little bit below that.
Speaker 3: You have burks thirty two.
Speaker 2: I have some books. Yeah, they belong to my daughter
Speaker 2: I had.
Speaker 3: Did you Yeah, like probably high school.
Speaker 2: Of course you were there, you lived in Califori.
Speaker 3: Yeah, they were like they're yeah. I mean they're back
Speaker 3: now now they're cool. I wasn't cool then. I'm not
Speaker 3: cool now.
Speaker 2: Just wear them because you were kind of a nerdy
Speaker 2: California kid.
Speaker 3: Yeah, that's exactly right.
Speaker 2: I wonder if bike CEOs wear them.
Speaker 3: It depends on this. Just hanging out, yeah, you know
Speaker 3: at the beach. Yeah, maybe wearing some berks.
Speaker 2: No, you can't see it anyway. We do have big
Speaker 2: bank earnings coming in your way this week. JP Morgan
Speaker 2: Chase City Group in Wells Fargo. They do report on
Speaker 2: Friday the thirteenth. We're focused on the sector, the impact
Speaker 2: of higher rates we talked about a little bit earlier
Speaker 2: with Ira Jersey and some of our team just met
Speaker 2: and also weighing in so important in terms of what
Speaker 2: they can tell us about the lending environment, whether it's corporate,
Speaker 2: retail loans, mortgages, like all this good stuff.
Speaker 3: Yeah, and keeping with that, we have a member of
Speaker 3: the banking community joining us right now. Priscilla Sims Brown
Speaker 3: is CEO of Amalgamated Bank. She joins us on Zoom
Speaker 3: from Martha's Vineyard this afternoon. Good to have you with us, Priscilla,
Speaker 3: how are you.
Speaker 5: I'm well and I have a pair of Birkenstocks in case.
Speaker 3: Okay, I like that. Well, you're also in Martha's vinyard
Speaker 3: right now, so it kind of makes sense. Hey, I
Speaker 3: want to talk about the bank in the history of
Speaker 3: the bank in just a minute, but first I just
Speaker 3: want to get your view on what you're seeing from
Speaker 3: the consumer, what you're seeing across your industry right now.
Speaker 5: Look, I mean, clearly, as the markets are showing, we
Speaker 5: have consumers who are having a hard time getting mortgages,
Speaker 5: trying to figure out what is going to happen to
Speaker 5: rates overtime. I don't have a crystal ball either on that,
Speaker 5: But I do feel that the change makers we do
Speaker 5: business with are really the organizations that are doing good
Speaker 5: are more important than ever right now because they're sort
Speaker 5: of helping the underserved, and we try to help the
Speaker 5: underserved to get access to capital.
Speaker 2: When you say, and I want to get into kind
Speaker 2: of more broadly of who you guys work with on
Speaker 2: a regular basis, consumers having a hard time, what does
Speaker 2: that mean? Are they defaulting? Are they what is it?
Speaker 2: Are they not borrowing? What are you seeing that that
Speaker 2: that needs you.
Speaker 5: Say that, Well, I'm saying that because interest rates are
Speaker 5: high and it's difficult to get a mortgage for many people. Also,
Speaker 5: access to capital for businesses, small businesses in particular that
Speaker 5: are expanding, is more expensive, and so it's you know,
Speaker 5: the equations are different, the math is different than it
Speaker 5: used to be for a number of people who are
Speaker 5: used to the lower interest rate environment. So how that
Speaker 5: will affect consumer sentiment over time, How that will affect
Speaker 5: the sentiment of the small businesses we work with, That's
Speaker 5: a question yet to be answered. But we certainly do
Speaker 5: hear about and see that consumers and small businesses are
Speaker 5: concerned about it.
Speaker 3: So what are you seeing in terms of consumer spending.
Speaker 5: Well, I don't have a real gauge on consumer spending.
Speaker 5: I read what you do, but I do think that
Speaker 5: at least in our universe, which again is we do
Speaker 5: have some consumers, but we are largely a bank for
Speaker 5: change makers. And what I do see there is that
Speaker 5: there are people feeling more that it's more important than
Speaker 5: ever as we look around at the status of migrants
Speaker 5: as a status of the wealth gap and more and more,
Speaker 5: this division of wealth that you see the median wealth
Speaker 5: is in this country is something that people are concerned about,
Speaker 5: and so our change makers are looking to try to
Speaker 5: help close that gap.
Speaker 2: Well, and I so get it. Change makers, you guys,
Speaker 2: were started back in the early nineteen twenties. It was
Speaker 2: about serving immigrant women who are working in what was
Speaker 2: called the needle trades. As somebody whose grandmother sewed a
Speaker 2: lot and was a seamstress, my grandfather was a tailor.
Speaker 2: Like I totally get like that economy from which it
Speaker 2: was created. You talk about change makers, so it's one
Speaker 2: thousand plus unions. You're talking about political groups, if you will,
Speaker 2: so talk to us a little bit about the people
Speaker 2: that you do work with regularly. And what that tells
Speaker 2: you the unions I'm really interested in. You know, you've
Speaker 2: seen an increase, have you, in business when it comes
Speaker 2: to the one thousand plus unions that you work with,
Speaker 2: especially as we've seen it, what seems to feel like
Speaker 2: a resurgence in the unionized workforce here in the United States.
Speaker 5: Yeah, that's right. I think it's those are all great observation.
Speaker 5: We were started one hundred years ago, as you say,
Speaker 5: by the needle trade. These were textile workers, mostly immigrants,
Speaker 5: who came to this country and they couldn't get banking.
Speaker 5: They couldn't find a way to get services everything from
Speaker 5: savings accounts to loans and for their mortgages, for their homes,
Speaker 5: to expand their businesses. They couldn't find loans to get
Speaker 5: their kids in college, those kinds of things, and so
Speaker 5: they started their own bank. And here we are almost
Speaker 5: exactly one hundred years later, and still we care a
Speaker 5: lot about workers' rights. Forty percent of our publicly traded
Speaker 5: stock is owned by unions. The rest is owned in
Speaker 5: the market broadly, like most banks, and we serve people who,
Speaker 5: as you say, you know, really what they hell have
Speaker 5: in common is they're trying to make a positive difference
Speaker 5: in the world and society forward. It includes everybody from
Speaker 5: political groups, whether that be candidates or political parties, racial
Speaker 5: justice organizations, social justice organizations, foundations, and of of course
Speaker 5: climate organizations and yes, unions.
Speaker 3: Well, you know, I think is so interesting about this.
Speaker 3: You go to your bank's website and there's literally up
Speaker 3: there with personal, small business, commercial, institutional investing. There's issues
Speaker 3: we care about a lot of things you just mentioned.
Speaker 3: Why do you think so many corporations shy away from
Speaker 3: speaking out about these things, whereas you guys embrace them.
Speaker 3: Just in the last forty five seconds.
Speaker 1: That we have with you.
Speaker 5: Yeah, Look, I think the reason we embrace them is
Speaker 5: because we are proving a concept that you can do
Speaker 5: well and do good. And we've been doing that for
Speaker 5: one hundred years and before it was ever fad. And
Speaker 5: we think that people have a conscience and business leaders
Speaker 5: have a conscience and they serve the underserved in minor ways.
Speaker 5: We do it in major ways, and we want to
Speaker 5: see others do so as well.
Speaker 2: All right, we've run out of time, but do you
Speaker 2: come back soon. I love to get you, need the
Speaker 2: conversation with you. Priscilla Sims Brown CEO of Amalgamated Bank,
Speaker 2: joining us on the phone from Arthur's vineyard. And you know, interesting,
Speaker 2: a very different take on a financial institution in terms
Speaker 2: of how they were creating what they've all about, and
Speaker 2: they kind of they continue that that mission if you
Speaker 2: I mean.
Speaker 3: These are these are issues that corporations run away from.
Speaker 3: Let alone, you know, highlight them on their website.
Speaker 2: Yeah, it's really cool. We'll get our back real soon.
Speaker 2: You're listening and watching Bloomberg Business Week on this Tuesday,
Speaker 2: Carol Master, Tim Stenevik, and this is Bloomberg Radio.
Speaker 1: You're listening to the Bloomberg Business Week podcast. Catch us
Speaker 1: live weekday afternoons from three to six Easter on Bloomberg Radio,
Speaker 1: the Bloomberg Business app and YouTube. You can also listen
Speaker 1: live on Amazon Alexa from our flagship New York station,
Speaker 1: Just Say Alexa playing Bloomberg eleven thirty a Bromarco a journal.
Speaker 2: Now about you let me drive Oh no, no, no.
Speaker 1: No, jug honey please gravels.
Speaker 2: Let's I want to try it.
Speaker 3: It's a good question.
Speaker 1: This is the drive to the globe. Do a thing
Speaker 1: well around other Don on Bloomberg Radio.
Speaker 2: All right, how many of you are attempted to just
Speaker 2: like I don't know, call into bed and then come
Speaker 2: come back and wake up in about three or four months?
Speaker 3: Are you asking me, hyber me to hibernate, hibernate.
Speaker 2: And then come back and I think the markets of
Speaker 2: like three or four months from now?
Speaker 3: Fine, sign me up.
Speaker 2: Why does that not surprise me?
Speaker 3: You know how I roll?
Speaker 2: All right, Well, let's see how our next guest rolls.
Speaker 2: Doug Sioak is back with a CEO and partner at
Speaker 2: Kavar Capital on Zoom and Leewood, Kansas. Doug, so good
Speaker 2: to have you back with us. There's a lot going
Speaker 2: on geopolitically, as you know, and you know we've been covering,
Speaker 2: but a lot coming out investors, just uh generally speaking.
Speaker 2: Having said that, what do you think if we all
Speaker 2: went to bed and then came back in three or
Speaker 2: four months, did the hibernation thing? Well, actually that would
Speaker 2: be like more like five or six months. What kind
Speaker 2: of environment might we have in four months or six
Speaker 2: months from now?
Speaker 6: Yeah, that's a great question, and thank you for having
Speaker 6: me back on. You know, I think we would have
Speaker 6: an environment that we've missed a lot of fantastic opportunities.
Speaker 6: You know, I think, like you kind of mentioned, there's
Speaker 6: been a lot of negativity. Obviously, the emotional weight of
Speaker 6: what transpired in Israel over the weekend is heavily on
Speaker 6: everyone's hearts and minds. And you know, the markets historically
Speaker 6: don't really know how to calibrate prospects of geopolitical escalation
Speaker 6: right there, knee jerk reactions into haven's and out of risk.
Speaker 6: But then there's a realization that conflict galvanizes government interventions
Speaker 6: and that could be an increase in capital and liquidity.
Speaker 6: And so it's kind of an emotional tension between I
Speaker 6: should say, it's sort of a tension point between emotion
Speaker 6: and economic and that kind of defines what the market's
Speaker 6: been but for various reasons throughout the year, No question.
Speaker 2: I like that combination between emotion and economic. That makes
Speaker 2: a lot of sense.
Speaker 3: Well, so where are we right now, because it it
Speaker 3: seems like it's less emotional at least today in terms
Speaker 3: of what's what's driving the market, because it seems like
Speaker 3: it's a sort of a well maybe it's maybe it
Speaker 3: is emotional, but maybe it's just dubvish.
Speaker 6: Yeah, I think, Tim, you could say, well, today's the
Speaker 6: Rafio Bastik or Philip Jefferson rally, you get a little
Speaker 6: attribution to Mary Daily because her acknowledgment of race efficiency
Speaker 6: was a bit more of a reversal than the end.
Speaker 2: Because our Lisa bramo Its did the most conversation, the
Speaker 2: most amazing conversation with her at the New York Economic Club.
Speaker 2: I have to just put a shout out for Lisa
Speaker 2: because it was pretty amazing. But anyway, go ahead, well great,
Speaker 2: and then go on top of that, I mean, lastly,
Speaker 2: a well elevated Chinese stimulus.
Speaker 6: And then I saw something interesting this morning from beastpoke
Speaker 6: and talking about the dollar has been in a bit
Speaker 6: of a decline over the last couple of weeks, and
Speaker 6: even in spite of the haven demand that eminated over
Speaker 6: the weekend. So today's a pretty good day, particularly you
Speaker 6: consider that the equit A S and P is outperforming
Speaker 6: the market cap waited by about thirty basis points for
Speaker 6: those that are concerned about an absence of breath, and
Speaker 6: no doubt this forty level the SMP has held pretty solidly.
Speaker 6: It's last week.
Speaker 2: Yeah, just Bett was talking about a week or dollar
Speaker 2: two impacking the trade.
Speaker 3: So Doug, do you think. I mean, it's hard to
Speaker 3: I don't even look back on the declines we saw
Speaker 3: last week and then see the surge we saw this week.
Speaker 3: I'm wondering if we're going to test those lows again,
Speaker 3: not just the lows from last week, but last October
Speaker 3: this cycle.
Speaker 6: It's a great question.
Speaker 4: You know.
Speaker 6: It's interesting, tim like essimists have been spewing this pretty
Speaker 6: well worn narrative, right, like, expect these brisistently high interest
Speaker 6: rates to number one, deccellerrate the economy, number two, undermind
Speaker 6: consumer competence, number three, rerate mark multiples and then lastly
Speaker 6: shift capital and or conservative corners, and all of that
Speaker 6: makes sense, right. And I also have said for a while,
Speaker 6: I don't know that the market is getting credit for
Speaker 6: time served last year. Right, Yes, we had a nice bounce,
Speaker 6: We're we're still not taken out the prior period highs, right,
Speaker 6: even though we've had the bounce in the one year
Speaker 6: university in a couple of days ago of those lows,
Speaker 6: but historically right, when you just look at where we
Speaker 6: are at current real yields, it's actually a coin toss
Speaker 6: between stock and bond performance. Looking out twelve months, both
Speaker 6: are positive. Again. This is historically not predictive, just perspective.
Speaker 6: But inflation has come down a bunch off the peak.
Speaker 6: And this is what we know, and I read this
Speaker 6: from Golden Sacks last week. Since nineteen forty five, the
Speaker 6: S and P is there isn't twenty one percent on average,
Speaker 6: and then two years after LUISA data showing a peak
Speaker 6: and CPI, if you take out episodes with a recession,
Speaker 6: that means you're looking at more like a twenty eight
Speaker 6: percent game over that two year period. So I do
Speaker 6: think because the wall of warry is so steep, a
Speaker 6: lot of that is reflected in valuations, and there's some
Speaker 6: pretty attracted places to put money right now, and there's
Speaker 6: some pretty important inflection points that are building.
Speaker 2: So when you say market getting credit for time served,
Speaker 2: you're talking equity market specifically.
Speaker 6: And fixed income, right, Carolcause you figure last year is
Speaker 6: what the seventh worst year in the history of stocks,
Speaker 6: the first worst year of the history of bonds. It
Speaker 6: was a single worst year for bonds, the single worse
Speaker 6: three year period of monds, seven, five and ten year
Speaker 6: period in bonds. Don't why I said those out of
Speaker 6: the chronologic order, but so there was a lot of
Speaker 6: time served, a lot of unwine, a lot of slack
Speaker 6: and access left both both markets, which needed to happen.
Speaker 4: Right.
Speaker 6: There was just so much liquidity that has now come
Speaker 6: out of the market, and it's still coming out of
Speaker 6: the market, and it's one of the reasons why we're
Speaker 6: seeing the back end of the curve rising as it hass.
Speaker 2: So in other words, both stocks and bonds have gotten
Speaker 2: the heck beaten out of them, and so let's remember
Speaker 2: that in terms of when we look at the trade today.
Speaker 6: Absolutely, that's a much better and more concise way to
Speaker 6: say that.
Speaker 2: I could have used another four letter word, but you know,
Speaker 2: we are Bloomberg and I like to keep it clean anyway,
Speaker 2: But it's no, that's a really good point. So, having
Speaker 2: said that, it's an interesting week, Doug with bank earnings,
Speaker 2: and we're looking for a lot of guidance and understanding
Speaker 2: of kind of where we go from here from the
Speaker 2: big bank CEO. So who can tell us a lot
Speaker 2: right about the lending environment, especially when you've got the
Speaker 2: FED concerned about tightening financial conditions. That's why I think
Speaker 2: what we get from the banks is even more important.
Speaker 2: But you've also got some FED minutes and those inflation
Speaker 2: prints is this potentially a very important for you and
Speaker 2: maybe how you think about the markets and where it
Speaker 2: goes from here or what you know.
Speaker 6: I think every piece is incremental, right, what we've had
Speaker 6: this obsession with and likely because it's been big center
Speaker 6: point over the media, but then also feeling questions from
Speaker 6: our clients is is there a chance for a soft landing?
Speaker 6: And to your point here, when we're going to get
Speaker 6: some aspects of that case that can be affirmative or
Speaker 6: counter and we think there's a chance for a soft landing.
Speaker 6: And if you really think about we have stable and
Speaker 6: accelerating economic growth, do you realize that the GDP and
Speaker 6: out the Atlanta Federate is protecting a third quarter GDP
Speaker 6: of four point nine percent? Do you believe it so
Speaker 6: a GDP? Say it again?
Speaker 3: I was going to say, I mean, they have a
Speaker 3: pretty good track record.
Speaker 6: They do have a pretty good track record, right, And
Speaker 6: you have stable to falling CPI and PCE. And we
Speaker 6: saw on Friday last Friday this ridiculously strong headline at
Speaker 6: a P number but also with significant dry up and
Speaker 6: this name it in its drop of our average all yearnings.
Speaker 6: So you've got an economy that's resilient. A consumer that's
Speaker 6: still spending even though they've lost some leverage and celerityed negotiations,
Speaker 6: which we saw on the quits rate as well, is
Speaker 6: actually okay, is some of the stuff that they're buying
Speaker 6: is dropping in price.
Speaker 3: Ryes I clumbate, So Stabler accelerating growth, a consumer who's
Speaker 3: still spending. What else is on the team self planning?
Speaker 1: Yeah?
Speaker 3: What else is on team self landing?
Speaker 6: Well, it got to consider the consumer so importantly because
Speaker 6: it's sixty eight percent of GDP is wrapped up in
Speaker 6: consumers contribution. So you still have a strong employment pick
Speaker 6: that I mentioned, you have low leverage, it's percentage of
Speaker 6: household net worth. And then this is really fascinating art
Speaker 6: on Wall Street Journal over the weekend talked about the
Speaker 6: shifting and the burden of purchasing from the younger of
Speaker 6: the older cohort in this country. And I didn't realize
Speaker 6: that people aged sixty five and up spend twenty two
Speaker 6: percent of all the dollars in this country annually. That's
Speaker 6: up from fifteen percent in twenty ten. And American the
Speaker 6: seventy in higher control twenty six percent of the household wealth.
Speaker 6: So you have this cohort of people that is also
Speaker 6: going through this emotional catharsis of you know what, we
Speaker 6: went through the pandemic. You know what life can be short.
Speaker 6: You know what I'm gonna spend right, it seems five
Speaker 6: to seven percent elevation and I've spending it very.
Speaker 2: I got family members who are doing that and traveling
Speaker 2: and doing all that kind of things. Doug Sioka, thank
Speaker 2: you so much of Kavar Capital. This is Bloomberg.
Speaker 1: This is the Bloomberg Business Week podcast, available on Apple, Spotify,
Speaker 1: and anywhere else you hit your podcast. Listen live weekday
Speaker 1: afternoons from three to six Eastern on Bloomberg dot com,
Speaker 1: the iHeartRadio app, tune In, and the Bloomberg Business App.
Speaker 1: You can also watch us live every weekday on YouTube
Speaker 1: and always on the Bloomberg Jermany alone