WEBVTT - Still a Long Way to Maximum Employment 0:00:00.800 --> 0:00:04.040 Welcome to the Bloomberg Markets Podcast. I'm Paul Sweeney, alongside 0:00:04.040 --> 0:00:06.920 my co host Matt Miller. Every business day we bring 0:00:06.960 --> 0:00:11.520 you interviews from CEOs, market pros, and Bloomberg experts, along 0:00:11.560 --> 0:00:15.600 with essential market moving news. Find the Bloomberg Markets Podcast 0:00:15.600 --> 0:00:18.479 on Apple Podcasts or wherever you listen to podcasts, and 0:00:18.480 --> 0:00:21.279 at Bloomberg dot com slash podcast. I want to get 0:00:21.280 --> 0:00:24.200 over to Jeffrey Cleveland right now. He's a principal and 0:00:24.280 --> 0:00:28.120 chief economist at Payden and Rival, and he's got um 0:00:28.160 --> 0:00:30.360 some real intelligence for us on the U S JAS 0:00:30.440 --> 0:00:33.559 market and how it relates to the FED. First, I 0:00:33.600 --> 0:00:37.480 want to talk about the Triple Crown of open water swimming. Jeffrey, 0:00:37.600 --> 0:00:41.360 you have completed a swim across the English Channel, the 0:00:41.400 --> 0:00:44.400 Catalina Channel, and you've swum the entire distance around the 0:00:44.440 --> 0:00:50.280 island of Manhattan. What compels you to join this elite club. 0:00:50.320 --> 0:00:53.360 I think only forty people have done it well. I 0:00:53.360 --> 0:00:55.280 think it's one of those things if you're a swimmer 0:00:55.280 --> 0:00:58.320 in college and you're not quite as fast as you know, 0:00:58.400 --> 0:01:01.720 say Caleb Drestle or or Michael Phelps you, you look 0:01:01.760 --> 0:01:03.880 for stuff to do after college, and I took up 0:01:03.920 --> 0:01:06.240 ocean swimming, did a bunch of swims in the San 0:01:06.280 --> 0:01:09.399 Francisco Bay actually, and then you know, in the ocean 0:01:09.440 --> 0:01:13.360 swimming community, it's really you know, it's like climbing Everest, uh, 0:01:13.400 --> 0:01:15.679 you know, swimming across the English Channel. So that's that's 0:01:15.720 --> 0:01:17.760 kind of something that you want to check off your 0:01:17.760 --> 0:01:20.920 bucket list. So I once I did that, I realized 0:01:20.959 --> 0:01:23.000 that there was any more exclusive club, which was the 0:01:23.000 --> 0:01:25.000 Triple Crown. People have done all three of those. So 0:01:25.120 --> 0:01:27.000 I felt like I had to swim from Catalina back 0:01:27.000 --> 0:01:29.520 to l A and then and then around the Great 0:01:29.560 --> 0:01:32.680 Island of Manhattan. Only forty people in the world have 0:01:32.760 --> 0:01:34.880 done it. We're talking in the history of the world 0:01:34.920 --> 0:01:38.640 have done this. So it's a pretty exclusive club and 0:01:38.920 --> 0:01:41.319 very impressive. I just wanted to hit on that so 0:01:41.400 --> 0:01:44.320 our listeners know. I mean, obviously you've done a lot 0:01:44.360 --> 0:01:46.960 of other stuff, but that's huge. Um, all right, let's 0:01:46.959 --> 0:01:50.560 get to the Jobs Report and the FED, because in 0:01:50.600 --> 0:01:54.400 your view, we're still a long way from maximum unemployment. 0:01:54.400 --> 0:01:56.240 We know this FED is focused on that and they 0:01:56.280 --> 0:02:02.200 have an outcomes outcome based frame in place. So does 0:02:02.240 --> 0:02:06.400 that mean, um, you don't think we're gonna see what 0:02:06.560 --> 0:02:13.200 tapering so soon? Um, and certainly not rate hikes either. Yeah, 0:02:13.280 --> 0:02:15.239 here's the context I would give you. This morning, we 0:02:15.360 --> 0:02:17.960 got eight d fifty thou jobs added for June that 0:02:18.000 --> 0:02:21.120 beat the consensus. Yet, as you know to ten, your 0:02:21.120 --> 0:02:23.519 treasury yield are a little bit lower in fact yield 0:02:23.639 --> 0:02:26.920 across the curve or lower today. So um, it's a 0:02:26.919 --> 0:02:29.000 bit of a head scratcher. But I think the context 0:02:29.040 --> 0:02:32.200 that matters is that even if we add eight hundred 0:02:32.200 --> 0:02:34.880 and fifty thousand jobs per month going forward, we're still 0:02:35.000 --> 0:02:38.600 a long way to anything that I would describe this 0:02:38.760 --> 0:02:42.160 maximum employment. Probably takes another year or so to get 0:02:42.200 --> 0:02:46.079 back to pre COVID levels on total employment. So we'll 0:02:46.120 --> 0:02:47.960 get there. We're moving in the right direction. It's very 0:02:47.960 --> 0:02:50.480 good news, but it's still gonna I think, fall short 0:02:50.520 --> 0:02:54.040 in a year's time from from maximum employment. And you 0:02:54.080 --> 0:02:55.960 know a little hints of that today, right you had 0:02:56.040 --> 0:02:57.880 the the unemployment rate take up a little bit to 0:02:57.919 --> 0:03:01.040 five point nine percent, so that's um, it's a bit disappointing. 0:03:01.080 --> 0:03:05.080 And then there's no progress on labor force participation, so 0:03:05.280 --> 0:03:07.680 it's it's possibly to get a year from now, we're 0:03:07.720 --> 0:03:10.920 still not at maximum employment. So I think, you know, 0:03:11.000 --> 0:03:15.320 calls for rate hike are are really really premature. That's 0:03:15.360 --> 0:03:18.480 the biggest consideration tapering. You know, the FED is trying 0:03:18.600 --> 0:03:22.119 very hard to separate tapering from hiking. I think they've 0:03:22.120 --> 0:03:24.079 done a pretty good job of doing that. There's two 0:03:24.080 --> 0:03:27.560 different decisions. We do think they will start to tapor 0:03:28.200 --> 0:03:31.880 beginning in Q one of two, but it's it's for me, 0:03:32.040 --> 0:03:34.440 the big question for the markets, whether it's the Bob 0:03:34.520 --> 0:03:37.000 market or whether it's equities, is you know, when did 0:03:37.000 --> 0:03:39.840 that first rate hike arrive a couple weeks ago? There 0:03:39.880 --> 0:03:42.080 is some concerning it. We might arrive in two. I 0:03:42.160 --> 0:03:46.320 think the data today tells you now that's uh at 0:03:46.320 --> 0:03:49.440 the earliest. Well, that last f O MC meeting, Jeffrey, 0:03:49.520 --> 0:03:52.640 there's some focus on the dot plots. Is that where 0:03:52.640 --> 0:03:55.120 the focus should be? I don't think so. I think 0:03:55.120 --> 0:03:57.880 the dots are distraction. You know, I've been a long 0:03:57.920 --> 0:04:00.960 time critic of these dots. I've been saying, drop the 0:04:00.960 --> 0:04:05.320 dot plot. It's it's you know, those figures are interesting, 0:04:05.400 --> 0:04:08.000 but they're submitted before the meeting. They're not the topic 0:04:08.040 --> 0:04:11.920 of conversation at the meeting, and they're not a policy outcome. 0:04:12.000 --> 0:04:14.960 Of the meeting, and I think it provides a lot 0:04:15.040 --> 0:04:18.360 of fodder, you know, a permanent employment clause for for 0:04:18.360 --> 0:04:21.039 FED watchers such as myself of course, so and a 0:04:21.080 --> 0:04:24.760 great screen on a Bloomberg terminal, which is good, exactly great, 0:04:24.839 --> 0:04:27.000 great screen, But I don't think it tells you a 0:04:27.000 --> 0:04:29.520 whole lot. I think if you're an investor, you shouldn't 0:04:29.560 --> 0:04:32.000 look too much at what policymakers have in terms of 0:04:32.040 --> 0:04:35.000 their dots for for a rate hike. Say, you should say, 0:04:35.120 --> 0:04:37.720 when are we going to reach maximum employment? And then 0:04:37.760 --> 0:04:39.960 you should ask, okay, at that time we read when 0:04:39.960 --> 0:04:43.080 we reach maximum employment, are we gonna do we have 0:04:43.200 --> 0:04:46.600 sustainable two percent inflation? Those are the two things that 0:04:46.640 --> 0:04:49.760 will determine whether the rate hike occurs, and so our 0:04:49.800 --> 0:04:52.800 conclusion is we won't have maximum employment before you know, 0:04:52.839 --> 0:04:55.400 maybe the end of two or after, so that kind 0:04:55.440 --> 0:04:58.280 of rules out a rate hike before that. Great to 0:04:58.320 --> 0:05:00.800 get your views, Jeffrey, thanks to much for joining us. 0:05:01.080 --> 0:05:03.760 Jeffrey Cleveland is chief economist and a principle at Payden 0:05:04.080 --> 0:05:07.359 and Regal. Talking to us about the Job's report and 0:05:07.520 --> 0:05:12.400 the FED. I want to bring in now Leonid Burjitsky. 0:05:12.520 --> 0:05:15.800 He writes, for Bloomberg Opinion, and his latest story, Dark 0:05:15.839 --> 0:05:20.880 Markets Can Be a geopolitical force, talks about um cyber 0:05:20.960 --> 0:05:25.839 hacking and the blame game that we've all seen kind 0:05:25.880 --> 0:05:31.760 of carefully played between Presidents Biden and Putin at their 0:05:31.839 --> 0:05:35.880 last summit. Most recently, um, uh, there was a German 0:05:36.440 --> 0:05:40.640 banking system hack that has been blamed, at least by 0:05:41.120 --> 0:05:46.159 German the German press on Russian hackers, state Russian hackers. 0:05:46.160 --> 0:05:48.159 They even say in the Builds Tongue, which is the 0:05:48.160 --> 0:05:51.560 most widely read paper here, Leonid. I've actually been wondering 0:05:51.560 --> 0:05:53.640 about this for a long time. Is it really fair 0:05:53.720 --> 0:05:59.040 for us to say, um, definitively that these hack attacks 0:05:59.040 --> 0:06:03.159 are from eight backed Russian criminals just because they are 0:06:03.320 --> 0:06:07.719 in Russia. I mean, if we blamed every US criminal 0:06:07.800 --> 0:06:10.280 on the US government, um, you you have a lot 0:06:10.320 --> 0:06:13.599 of problems in Washington, d C. As well. Yeah. Well, 0:06:13.640 --> 0:06:17.560 there's this major difference between Russia and the US. Russia 0:06:17.640 --> 0:06:23.560 is increasingly a police state, and not many things happened 0:06:23.600 --> 0:06:28.440 there without the government's explicit or implicit consent, especially if 0:06:28.480 --> 0:06:36.440 they're um, you know, big projects. Uh. For example, the 0:06:36.480 --> 0:06:42.120 column that you mentioned UM talks about Guibro hydra uh 0:06:42.400 --> 0:06:48.400 dark marketplace for mostly drugs, but also fake papers and 0:06:48.440 --> 0:06:55.000 stuff like that. It's a silk road. Yeah. Well again 0:06:55.080 --> 0:06:59.240 there's a difference silk road uh to the west. As 0:06:59.240 --> 0:07:02.440 a law hyper has been around since two thousands fifteen. 0:07:03.040 --> 0:07:07.680 Uh and it's got an annual turnover of more than 0:07:07.680 --> 0:07:12.720 a billion dollars in cryptocurrency, So it's a it's a 0:07:12.760 --> 0:07:19.440 pretty noticeable project. Uh. And uh you know, it is 0:07:19.640 --> 0:07:22.520 the place where if you want to buy drugs in Moscow, 0:07:22.600 --> 0:07:26.000 that is where you go. Uh. So it's it's kind 0:07:26.000 --> 0:07:29.880 of impossible to ignore. It's sort of the elephant in 0:07:29.960 --> 0:07:34.760 the room. Uh. And the you know, things like that 0:07:35.040 --> 0:07:40.960 cannot really operates in Russia without some sort of protection 0:07:41.120 --> 0:07:45.440 from above. Uh. And you know that is the difference 0:07:45.720 --> 0:07:49.240 with the US, where you can you know, build a 0:07:49.400 --> 0:07:57.400 larger wizard project and not uh have corrupt officials protecting 0:07:57.520 --> 0:08:00.320 or supporting it in some way. So it and I 0:08:00.360 --> 0:08:02.120 guess that's one of the questions I think a lot 0:08:02.120 --> 0:08:04.360 of people have is when they think about the Russian 0:08:05.960 --> 0:08:09.000 I guess influence or role of the government in these 0:08:09.040 --> 0:08:12.360 hacking Is it support per se or is it just 0:08:12.440 --> 0:08:17.960 simply turning a blind eye well, turning a blind eye 0:08:18.120 --> 0:08:21.280 is a form of support, right it is. But I 0:08:21.320 --> 0:08:26.320 don't know if there's anything more overt Uh Well, uh, 0:08:26.800 --> 0:08:31.880 for one thing, whoever is protecting these uh, these businesses 0:08:32.200 --> 0:08:37.199 and the entire infrastructure, the entire ecosystem that has uh 0:08:37.960 --> 0:08:43.920 grown up around them for money woundering, for uh, providing 0:08:43.960 --> 0:08:48.960 worked engineers and to other you know, lots of other people. 0:08:49.640 --> 0:08:55.920 It's a huge ecosystem. And uh, if the you know, 0:08:56.000 --> 0:08:59.320 if somebody in the government is turning a blind eye, 0:09:00.240 --> 0:09:05.280 that person or or those persons are highly personally interested 0:09:05.320 --> 0:09:08.760 and probably you know, getting part of the parts of 0:09:08.760 --> 0:09:14.360 the profits in exchange. So that is one, uh sort 0:09:14.400 --> 0:09:19.840 of one thing that you can't really ignore. The other 0:09:19.880 --> 0:09:25.080 one is the geopolitical angle. H If the hackers and 0:09:25.200 --> 0:09:31.040 if these illicit operations hit the West and not Russian targets, 0:09:31.960 --> 0:09:37.360 then basically this at least coincides with the direction of 0:09:37.360 --> 0:09:43.000 official policy, and there's less of a reason for the government, 0:09:43.600 --> 0:09:46.640 the Kremlin, you know, the authorities to go after them. 0:09:46.720 --> 0:09:51.319 They're actually seen as doing something useful for the motherland. Well, 0:09:51.360 --> 0:09:54.280 and also I don't think they could expect due process 0:09:54.360 --> 0:09:58.240 necessarily if they were to hit Russia. Just like, Um, 0:09:58.240 --> 0:10:02.559 you know, Chinese criminals probably shy away from hitting out 0:10:02.600 --> 0:10:06.280 against the party. Do they have the same you know, 0:10:08.200 --> 0:10:12.040 is there is there the same tacit support of crime 0:10:12.120 --> 0:10:17.320 like this in China? Oh? I, Um, I wouldn't really 0:10:17.360 --> 0:10:22.719 know about China Russians, you know where I'm from. Uh, 0:10:23.160 --> 0:10:26.320 that's uh, that's how it kind of works there. If 0:10:27.720 --> 0:10:32.000 the targets that are hit by criminals are also targets 0:10:32.000 --> 0:10:38.720 that are hostile to the government, the government shouldn't really 0:10:38.760 --> 0:10:44.560 be expected to come down hard on these criminals. So Lena, 0:10:44.640 --> 0:10:47.120 give us a sense of what the policy of the 0:10:47.200 --> 0:10:51.440 United States has been to this to this point and 0:10:51.480 --> 0:10:56.880 maybe how it needs to change. Well, the US government, UM, 0:10:57.760 --> 0:11:00.760 it's kind of it has to walk a fine line. 0:11:01.040 --> 0:11:05.920 It can't say you know, you can't tell putting directly. Uh, 0:11:05.920 --> 0:11:10.079 you know, someone in your entourage or you personally are 0:11:10.120 --> 0:11:14.800 on the take and and like protecting. Uh, these are 0:11:14.840 --> 0:11:18.640 wiggled businesses for payment. Uh you know what. The the 0:11:18.760 --> 0:11:21.400 only thing that they can say, and they've been actually 0:11:21.760 --> 0:11:26.960 doing it quite correctly under Biden. They've been saying, you know, 0:11:27.120 --> 0:11:30.880 these people operate from your territory. They seem to enjoy 0:11:30.960 --> 0:11:33.920 some kind of protection. And you know that's not a 0:11:33.920 --> 0:11:39.360 good thing. I doubt that the US government can do 0:11:39.840 --> 0:11:44.040 more than that in the sort of in the public space. Uh. 0:11:44.360 --> 0:11:48.680 The other thing it can do is um, uh you know, 0:11:48.880 --> 0:11:57.400 is fight back and step up the defenses of important infrastructure. 0:11:59.000 --> 0:12:01.840 I wanted to ask you about something. I was going 0:12:01.880 --> 0:12:04.680 to say completely different, Leonard, But I don't know how 0:12:05.400 --> 0:12:09.720 far off George Orwell is from what we're seeing here. 0:12:10.240 --> 0:12:13.640 And I ask you because you recently authored a Russian 0:12:13.679 --> 0:12:21.240 translation of UM, the British author's masterpiece. Uh, what are 0:12:21.280 --> 0:12:25.320 you seeing? I mean he Orwell famously UM modeled his 0:12:25.640 --> 0:12:31.000 novel after Stalinist Russia. What are the differences between what 0:12:31.080 --> 0:12:38.160 we see there and Putinist Russia well like or doesn't 0:12:38.200 --> 0:12:45.320 exactly model uh Oceania UM on Stalin's Russie was sort 0:12:45.320 --> 0:12:50.920 of your UM, you know, a combination of different autalitarian regimes. 0:12:50.920 --> 0:12:56.560 There were elements of Nazi Germany UM and actually elements 0:12:56.600 --> 0:13:01.480 of UM, you know, wartime influence in in the in 0:13:01.520 --> 0:13:08.640 those descriptions UM, but U and and because it is 0:13:09.080 --> 0:13:15.839 that way and there's no like specific model there, you 0:13:15.960 --> 0:13:21.480 can obviously, you know, find lots of similarities with other 0:13:21.800 --> 0:13:28.120 authoritarian governments, including the current Russian one. Obviously, the you know, 0:13:28.240 --> 0:13:34.560 the sort of the um, the hostility towards the outside 0:13:34.600 --> 0:13:39.120 world is very similar to what we're all described. Uh. 0:13:39.160 --> 0:13:43.839 And the sort of siege mentality UM and the lack 0:13:43.920 --> 0:13:48.400 of basically a lack of written rules is one other. 0:13:49.240 --> 0:13:57.679 Um sort of certainly brother right well yeah, yeah, the 0:13:58.000 --> 0:14:02.920 well big brother is uh sort of a guy with 0:14:03.040 --> 0:14:08.719 many faces and uh yeah, one face. Leonardst Sky, thank 0:14:08.720 --> 0:14:11.760 you so much for joining us. Lena is colmunist for 0:14:11.880 --> 0:14:17.000 Bloomberg Opinion based in Berlin. Right now, I want to 0:14:17.040 --> 0:14:19.960 talk more about work. Tom Gimble joins us. He's a 0:14:20.000 --> 0:14:23.600 founder and CEO of the LaSalle Network. It's one of 0:14:23.600 --> 0:14:27.240 the leading staffing and recruiting firms in the country. And 0:14:27.840 --> 0:14:30.600 good morning to you. Thanks for joining us. Tom. Let 0:14:30.600 --> 0:14:34.720 me first ask you about your reaction to the numbers. UM, 0:14:34.760 --> 0:14:37.440 what do you think, eighty thou Are we gonna keep 0:14:37.440 --> 0:14:40.240 seeing numbers like this? Yeah? I think it's great. I 0:14:40.240 --> 0:14:43.880 think well, you know, we saw today was numbers of 0:14:44.000 --> 0:14:48.480 recent college graduates from May entering the workforce in June 0:14:48.480 --> 0:14:52.560 and getting hired. We still saw pandemic recovery in the 0:14:52.720 --> 0:14:56.960 service and hospitality industry, meaning with warmer weather and restaurants opening. 0:14:57.160 --> 0:15:00.520 But even though there's a huge shortage of labor, there's 0:15:00.560 --> 0:15:03.640 still a lot of people finding jobs. And so you've 0:15:03.640 --> 0:15:06.880 got those two things coming together for the numbers. And so, 0:15:06.960 --> 0:15:09.120 you know, my feeling is even if it would have 0:15:09.120 --> 0:15:12.200 been below estimates at six fifty or five hundred thousands, 0:15:12.520 --> 0:15:15.120 it's still a win. Estimates are just that estimates. But 0:15:15.440 --> 0:15:18.360 anytime we're we're adding over a half million new jobs, 0:15:18.360 --> 0:15:22.120 it's a good thing, all right. Tom. When you talk 0:15:22.200 --> 0:15:25.479 to your clients and they're talking about their hiring processes, 0:15:25.840 --> 0:15:27.800 we've heard lots of stories about how a lot of 0:15:27.800 --> 0:15:32.080 companies are unable to find workers. What do you think 0:15:32.200 --> 0:15:37.000 are the primary reasons that that's the case. So our 0:15:37.120 --> 0:15:39.920 firm works with venture capital BAK firms. We work with 0:15:40.000 --> 0:15:43.840 private equity owned companies and publicly traded companies, and what 0:15:43.920 --> 0:15:47.760 we see in the marketplace is companies are in high 0:15:47.800 --> 0:15:51.200 demand of people, and we do all white collar positions, 0:15:51.240 --> 0:15:53.080 even though some of our clients may also hire for 0:15:53.120 --> 0:15:57.320 blue collar rolls and on the lower level positions. The 0:15:58.200 --> 0:16:01.720 increased unemployment company station from the federal government is for 0:16:01.920 --> 0:16:06.040 sure a hindrance the companies finding people. On the flip side, 0:16:06.080 --> 0:16:10.360 we've got people that have relocated, uh due to remote 0:16:10.360 --> 0:16:13.560 work due to the pandemic, and have left where jobs 0:16:13.600 --> 0:16:16.720 are and have gone to other areas in warmer states, 0:16:16.720 --> 0:16:19.800 southern areas, and it's left a lot of vacancies in 0:16:19.840 --> 0:16:22.520 the northern part of the country. And I think once 0:16:22.600 --> 0:16:26.560 we see the economy kind of settled down post pandemic. 0:16:26.600 --> 0:16:28.360 I don't mean settled down like in a bad way, 0:16:28.640 --> 0:16:31.920 but settled down that people aren't worried about the pandemic anymore, 0:16:32.360 --> 0:16:36.680 We're going to start seeing those positions get built. Where 0:16:36.720 --> 0:16:41.440 are you seeing um less growth than you anticipated? One 0:16:41.480 --> 0:16:44.480 of the interesting things, Tom, which is why I ask 0:16:45.040 --> 0:16:48.720 that we've noticed, is that a lot of industries, for example, 0:16:48.760 --> 0:16:53.720 airlines have been able to boost production UM closer to 0:16:53.800 --> 0:16:58.440 pre pandemic levels without boosting hiring. And I guess that's 0:16:58.480 --> 0:17:00.760 because they have a lot of automation in place that 0:17:01.160 --> 0:17:03.400 they brought forward. Are you seeing that in other industries 0:17:03.440 --> 0:17:06.560 as well? Well? I don't know and not you know, 0:17:06.600 --> 0:17:08.520 I know what the data says to an extent, but 0:17:08.560 --> 0:17:09.960 I'm not sure if I agree with that on the 0:17:10.000 --> 0:17:13.480 airline when the numbers aren't where they were pre feel you, Yeah, 0:17:13.600 --> 0:17:17.320 I feel you, because they could they could just at 0:17:17.320 --> 0:17:21.080 the higher occupancy level. Ye ye, right, so they weren't 0:17:21.119 --> 0:17:24.520 running efficiently before, or they haven't fired as many people 0:17:24.640 --> 0:17:26.639 and so they don't need to rehire. I know data. 0:17:27.040 --> 0:17:29.480 I agree with Mark Twain, you know, um, I can't 0:17:29.520 --> 0:17:32.200 remember the exact quote, but something about lies. In any case, 0:17:32.760 --> 0:17:36.440 we do see though, technology, you know, being brought forward 0:17:36.520 --> 0:17:38.880 to automate a lot of positions that you know used 0:17:38.880 --> 0:17:42.719 to require humans. Yes and no, we're we're doing it. 0:17:42.960 --> 0:17:44.840 You know, like you go to a baseball game now 0:17:44.920 --> 0:17:47.919 and instead of having as many vendors they're having, you 0:17:47.960 --> 0:17:49.919 can order it on your phone and food will be 0:17:49.960 --> 0:17:53.200 delivered to you. Right, it's a technology innovation. The difference 0:17:53.280 --> 0:17:55.679 is you're waiting three or four innings to get the 0:17:55.720 --> 0:17:58.680 food and there still aren't as many people doing the job, 0:17:59.200 --> 0:18:01.000 and you're not it in your food when you're one 0:18:01.080 --> 0:18:04.400 it and you're unhappy. So we're what companies are doing 0:18:04.480 --> 0:18:08.600 is they're using technology to compensate, but in some ways 0:18:08.800 --> 0:18:11.240 it's not giving you the same level of service as 0:18:11.280 --> 0:18:15.240 you get from having full unemployment full employment, So it's 0:18:15.240 --> 0:18:17.399 a it's a band aid, it's not a cure. And 0:18:17.440 --> 0:18:19.960 we're years away from being at the point where people 0:18:19.960 --> 0:18:24.080 are going to accept technological advances in lieu of having 0:18:24.080 --> 0:18:26.959 people to actually do the job. So to kind of 0:18:27.200 --> 0:18:29.399 follow up on that, there's still i think the number 0:18:29.440 --> 0:18:31.840 seven or eight million folks that are still out of 0:18:31.840 --> 0:18:35.240 work relative to prior to the pandemic. What's the elok 0:18:35.320 --> 0:18:36.679 for those folks. Do you think we're gonna get all 0:18:36.760 --> 0:18:39.040 them back into the workforce and perhaps you know over 0:18:39.040 --> 0:18:42.520 what time period? Well, those real questions there and number one, 0:18:42.640 --> 0:18:44.919 do they want to be in the workforce? Number two 0:18:45.160 --> 0:18:47.760 did they overvalue their worth when they got out of 0:18:47.760 --> 0:18:50.320 the workforce? And number three are they ready to take 0:18:50.359 --> 0:18:53.439 the jobs that are available versus what they want? You know, 0:18:53.720 --> 0:18:56.560 I'm the CEO of a hundred million dollar company. If 0:18:56.560 --> 0:18:58.600 I lost my job tomorrow and I only wanted to 0:18:58.600 --> 0:19:01.080 be the CEO of a hundred million dollar company, there 0:19:01.160 --> 0:19:02.959 might not be a job available for man might take 0:19:03.000 --> 0:19:05.200 a job at a startup or at a five million 0:19:05.200 --> 0:19:07.959 dollar company, and that might be an extreme, But if 0:19:08.000 --> 0:19:10.280 you look at somebody who was an accountant and they 0:19:10.320 --> 0:19:12.560 lost their job and they can't find a job as 0:19:12.560 --> 0:19:14.440 an accountant, maybe they weren't a very good one and 0:19:14.440 --> 0:19:16.960 they've got to go look at it. The infrastructure bill 0:19:17.280 --> 0:19:19.840 is gonna get passed, hopefully in the third quarter, and 0:19:19.880 --> 0:19:23.040 when that happens, there's gonna be tens of thousands, hundreds 0:19:23.080 --> 0:19:26.000 of thousands of jobs working on infrastructure, and people are 0:19:26.000 --> 0:19:28.280 gonna have to pivot and adjust. But the jobs are 0:19:28.280 --> 0:19:31.600 out there for anybody who wants one. Where are you 0:19:31.680 --> 0:19:35.359 seeing the biggest gains in terms of UH pay? I've 0:19:35.359 --> 0:19:38.840 noticed lately that all the banks are boosting their pay 0:19:38.920 --> 0:19:41.840 for junior analysts. Of course, not everybody can slide into 0:19:41.880 --> 0:19:45.600 those positions that easily. But are you seeing other industries 0:19:45.640 --> 0:19:51.120 where you know, just everyone's competing by by raising wages quickly. Yeah. 0:19:51.200 --> 0:19:53.359 The reason you're seeing it in banks is because the 0:19:53.680 --> 0:19:56.439 so much dry powder on the sidelines that deals are 0:19:56.440 --> 0:19:59.240 being done, So banks need to hire as many people 0:19:59.280 --> 0:20:01.600 as they can and to make sure that they're getting 0:20:01.640 --> 0:20:04.680 the market while it's hot. And you know, historically they 0:20:04.680 --> 0:20:07.200 don't have a hard time of downstizing when they need 0:20:07.240 --> 0:20:10.439 to either. Where we're seeing growth continually needs to be 0:20:10.920 --> 0:20:14.000 less in industry and more in skill sets. So we're 0:20:14.000 --> 0:20:17.400 seeing a ton of back office accounting and finance professionals 0:20:17.720 --> 0:20:22.880 at all types of companies, manufacturing technology, distribution service firms. 0:20:23.040 --> 0:20:25.000 We're seeing a ton of sales people, which is a 0:20:25.040 --> 0:20:28.040 great sign because that means companies are planning for longer 0:20:28.160 --> 0:20:30.520 term growth and they want more sales people to be 0:20:30.560 --> 0:20:33.160 able to do that for the foreseeable future. And then, 0:20:33.240 --> 0:20:36.360 as always, we're seeing technology that the biggest and most 0:20:36.400 --> 0:20:40.119 interesting role is human resources never took a hit during 0:20:40.160 --> 0:20:43.040 the recession, which is a huge surprise based on the 0:20:43.080 --> 0:20:46.159 most two recent recessions, and HR continues to be an 0:20:46.160 --> 0:20:49.320 area that companies are hiring for and one that terrifies me. 0:20:50.320 --> 0:20:54.159 Terrified of HR. If I see that HR on on 0:20:54.240 --> 0:20:57.320 my office phone, I'm I'm not picking up. Tom, thanks 0:20:57.359 --> 0:21:00.280 so much for joining us. Pleasure having you eight to 0:21:00.280 --> 0:21:03.040 get your insight. As always, Tom Gimball, founder and CEO 0:21:03.400 --> 0:21:07.720 of the Sound Network. Checking with Chad Obiad. He's a 0:21:07.720 --> 0:21:11.240 director of investment management and hunting in private bank seven 0:21:11.359 --> 0:21:16.840 billion dollars under management. Chad, when you see a disclosure part, 0:21:17.400 --> 0:21:19.919 do I need to do any disclosure here? I don't know, 0:21:20.000 --> 0:21:22.840 do you? It's my bank, it's your bank? There you go, 0:21:23.440 --> 0:21:26.040 it's the Bank of Matt Millard. There should get dat 0:21:26.040 --> 0:21:28.879 of Ohio. There should be a tagline the Bank of 0:21:29.119 --> 0:21:31.920 Matt Miller Bloomberg Television and makes them to change it. Chad. 0:21:31.960 --> 0:21:34.760 Let's ask them to change it, Chad. What what what 0:21:34.760 --> 0:21:37.120 do you make of that job's number we saw this morning? 0:21:37.119 --> 0:21:40.119 What does it mean for your economic outlook? Yeah? So 0:21:40.200 --> 0:21:42.960 certainly seeing that many people get back to work is 0:21:43.000 --> 0:21:47.439 good news, right, eight fifty thousand, well ahead of expectations, 0:21:47.600 --> 0:21:50.600 really good, But there's still some mixed messaging in the data. 0:21:50.680 --> 0:21:53.920 You saw the unemployment numbers tick up a bit. So 0:21:54.040 --> 0:21:56.480 as we continue to look through this data, is it 0:21:56.720 --> 0:21:59.600 enough to move the Fed? I think the general takeaway 0:21:59.600 --> 0:22:04.520 here is probably not. But from our general thesis, we 0:22:04.600 --> 0:22:08.399 still think the Fed starts to taper on the MBS side, 0:22:08.400 --> 0:22:12.480 that the bond purchases part of their asset purchases later 0:22:12.560 --> 0:22:16.440 this year. So, um, how much tapering do you think? 0:22:16.480 --> 0:22:19.000 I mean, I don't know how out of consensus that 0:22:19.080 --> 0:22:22.240 is at this point, Chad, it looks like, um, the 0:22:22.280 --> 0:22:25.640 economy is certainly humming along, and lord knows mortgage backed 0:22:25.640 --> 0:22:28.959 securities doesn't need any more support. So how much how 0:22:29.000 --> 0:22:32.720 much tapering do you expect, well, so we think the 0:22:32.760 --> 0:22:34.919 lion's share of the tapering would come from that NBS 0:22:34.960 --> 0:22:38.760 side for the rest of look for the Treasury side 0:22:38.800 --> 0:22:42.920 to start picking up early in two. We even saw 0:22:42.960 --> 0:22:45.399 the I m F this this morning coming out and 0:22:45.440 --> 0:22:49.080 saying that they're expecting some degree of tapering from US 0:22:49.160 --> 0:22:53.359 FED early in that first half of two. So to 0:22:53.440 --> 0:22:56.080 your point, I think we're in with consensus. We'll see 0:22:56.080 --> 0:23:00.440 if any of the additional data points change our perspective 0:23:00.480 --> 0:23:05.120 on that, and of course July as well as the 0:23:05.240 --> 0:23:08.640 symposium in Jackson holl will definitely be on our radar 0:23:08.680 --> 0:23:12.320 to see if the FED has any additional commentary. You know, 0:23:12.359 --> 0:23:14.359 we did get a bit of a hawkish stance, or 0:23:14.359 --> 0:23:17.960 at least interpretation of a hawkish stance at this last meeting. 0:23:18.240 --> 0:23:21.440 We'll see if their commentary changes that as well. Chat 0:23:21.480 --> 0:23:24.359 I'm looking at the again, the ten year one point 0:23:24.400 --> 0:23:27.240 four or four percent. Where do you go? Where is 0:23:28.040 --> 0:23:31.640 hunting in private bank going for yield these days? Yeah, 0:23:31.680 --> 0:23:35.320 that's a challenge, particularly for our Huntington's clients that are 0:23:35.359 --> 0:23:38.639 looking for income, and as we think about where to 0:23:38.720 --> 0:23:42.119 generate income, the bond market is really challenging and In fact, 0:23:42.400 --> 0:23:46.400 we've been overweight equities in the majority of our portfolios 0:23:46.720 --> 0:23:50.600 and looking for sources of yield in the equity markets. 0:23:50.680 --> 0:23:53.800 We've also been using things like preferreds and reads to 0:23:53.920 --> 0:23:59.560 gain some additional yield out of our portfolios. So, uh, 0:23:59.640 --> 0:24:02.639 well to yield are we talking about as someone as 0:24:02.680 --> 0:24:06.679 someone to act as your portfolios right? So, so the 0:24:06.720 --> 0:24:10.320 yield is going to be dependent on a number of variables, timeframe, 0:24:10.480 --> 0:24:14.000 targeted allocations, those types of things. So it is client dependent. 0:24:14.119 --> 0:24:16.760 We work very closely with our clients. We have portfolio 0:24:16.800 --> 0:24:20.080 managers and advisors throughout our footprint looking for those specific 0:24:20.160 --> 0:24:25.600 needs of our clients. But generally speaking, our positioning and 0:24:25.800 --> 0:24:28.360 this is playing into some of that income theme has 0:24:28.400 --> 0:24:31.760 been a post recessionary stance for our clients. Came into 0:24:31.800 --> 0:24:34.800 the year with this idea of a post recessionary stance. Lately, 0:24:34.880 --> 0:24:37.800 we've been adding to some of our inflation hedges though, 0:24:37.840 --> 0:24:42.120