Speaker 1: Ye. Welcome to the Bloomberg Surveillance Podcast and I'm Tom
Speaker 1: Keene Jay Ley. We bring you insight from the best
Speaker 1: in economics, finance, investment, and international relations. Find Bloomberg Surveillance
Speaker 1: on Apple Podcasts, SoundCloud, Bloomberg dot Com, and of course
Speaker 1: on the Bloomberg. Yeah. I don't want to oversaw it.
Speaker 1: I don't know when Mr Laidler is going to say
Speaker 1: here in a moment, but John, I looked at the
Speaker 1: pull back, if you will, that we're seeing in the market,
Speaker 1: and it only gets you at wors is like the
Speaker 1: nastack on to a centered tendency of the recent volatility.
Speaker 1: There's not a lot of gloom and doom on the tape.
Speaker 1: It's just sort of range bound center tendency. Off this morning,
Speaker 1: we know what Ben's going to say. He's going to
Speaker 1: say by but he's going to say bicyclicals. Let's bring
Speaker 1: it him right now, Ben Laidla Sama Hudson Research, see
Speaker 1: a bank right to have you with us? Uh. That
Speaker 1: is a change. Then later and it's not just about
Speaker 1: buying growth equities getting into some cyclicality. Why Ben, Because
Speaker 1: I think I think the election has held well back.
Speaker 1: I think all this talk are we gonna getus or
Speaker 1: not has just been a huge distractions has helped people back. Um,
Speaker 1: you know we're waiting for a vaccine. We don't have
Speaker 1: that yet. I think, you know, roll forward, let's get
Speaker 1: the election out of the way. That's got a bit
Speaker 1: of certainty there, and then let's look forward and what
Speaker 1: does that look like. One you're gonna get three to
Speaker 1: four percent GDP grow, if you're gonna get earnings, and
Speaker 1: you're gonna a mountain more than that off these sort
Speaker 1: of deep cyclical stops people until very recently basically being ignored.
Speaker 1: And I think those are the sort of the big
Speaker 1: beneficiaries of um, you know, the vaccine, which we're going
Speaker 1: to get something some more fiscal stimulus. I think we're
Speaker 1: gonna at something, um, you know, Biden winds and it's
Speaker 1: a blue wave you know, obviously gonna get a lot
Speaker 1: more than that. I think these are the sectors of
Speaker 1: the market which are cheap, which are out of favorite,
Speaker 1: and have just huge operation in lee bridge to this
Speaker 1: sort of base case scenario that I have from here,
Speaker 1: and it hasn't really moved yet because I think people
Speaker 1: have been very distracted by you know, by by this
Speaker 1: fiscal well of talk in the election and everything else.
Speaker 1: Then the challenge of people trying to catch up with
Speaker 1: Ben Laidler is on an absolute or relative basis, do
Speaker 1: you shift, do you shift away from big tech and
Speaker 1: tech completely, or do you do both together and still
Speaker 1: own both areas? Yeah, I mean I think you you know,
Speaker 1: you bring down those sort of quality growth sort of
Speaker 1: big tech healthcare a bit. But you know, I think
Speaker 1: that we're talking different instruments here. I mean I think
Speaker 1: that I think the tech is just a vac story.
Speaker 1: You know, it's with a long time. It's going to
Speaker 1: continue to look very good with these bound sheeets, with
Speaker 1: the structural growth outlook. But absolutely, I mean it's it's
Speaker 1: where everybody now there needs to be a ship. But
Speaker 1: you know, the seconds I'm asking, I'm telling people to
Speaker 1: shift into you know, industrial, stalk out real estate. I
Speaker 1: mean these are pretty small sectors. Um, you know, a
Speaker 1: little bit of money is going to go a very
Speaker 1: long way, and I think you're gonna get an awful
Speaker 1: lot of bang for your buck just because I mean
Speaker 1: just look at what's going on in third quarter earnings
Speaker 1: right now, which we're all sort of ignoring because there's
Speaker 1: a lot else going on. Um, you know, these cyclical sectors, industrials, energy,
Speaker 1: You have beaten expectations by over a dent so far.
Speaker 1: I mean, you're just getting huge leverage on the upside.
Speaker 1: There is, of course, the counter argument that the pandemic
Speaker 1: is accelerating and worsening dramatically in Europe and in places
Speaker 1: in the United States with a record number of cases,
Speaker 1: and that we're not out of the woods. Even if
Speaker 1: we get a vaccine, the rule out is going to
Speaker 1: be complicated, The efficacy is questionable. So how long can
Speaker 1: we stay in this environment with a pandemic still very
Speaker 1: much present and pushing people away from the public realm?
Speaker 1: How long does that have to go on before you
Speaker 1: change your view? Yeah, I mean I think that the
Speaker 1: relative surprise and the which is certainly given me, you know,
Speaker 1: a lot of a lot of hope has really just
Speaker 1: been the resilience of of the of the consumer, the
Speaker 1: resilience of the economic activity. I mean, just at a
Speaker 1: U s p M I for October last week at
Speaker 1: fifty five, I mean, very expansionary, you know, savings right,
Speaker 1: sort of retail sales are sort of back to pre
Speaker 1: sort of pandemic levels. I mean, we're in pretty good
Speaker 1: shape here. I mean I'm not naive enough to think
Speaker 1: that you know this, uh you know, this can go
Speaker 1: on forever. But I think, you know, the story so
Speaker 1: far has been one of just extreme resilience, and I
Speaker 1: certainly think that can go forward a little bit further.
Speaker 1: I mean, at some point, you know, we do need
Speaker 1: we do need some more physical stimulus. And and I
Speaker 1: think we're seeing, you know, everywhere that this second wave
Speaker 1: is uh you know, is having less deaths and less
Speaker 1: impact on economic activity. But but your points well taken,
Speaker 1: I mean obviously can't go on forever. I mean, I
Speaker 1: am looking for a vaccine. I am looking for some
Speaker 1: more physical stimulus, and I am looking for this sort
Speaker 1: of second wave to have less of an impact than,
Speaker 1: certainly than the first wave did. Equity features, as Ben speaks,
Speaker 1: ticking higher still negative, I hate tense. If one per
Speaker 1: cent on the SMP five hundred, Ben, just to wrap
Speaker 1: this conversation up, the correlation between cases increasing in the
Speaker 1: United States and what you think happens with consumer engagement.
Speaker 1: How loose or tight will that be? UM? I think, well,
Speaker 1: my previous point, I think that's a lot looser than
Speaker 1: it was previously. I mean, I think, you know, we've
Speaker 1: just learned to live with this to a certain degree. Um,
Speaker 1: those that have jobs, which clearly is not you know,
Speaker 1: it's not everybody, but those that do have a lot
Speaker 1: more money in their pocket than than they have done historically.
Speaker 1: So so again, you know, I think the consumer is
Speaker 1: going to be pretty resilient. Here's certainly for the next
Speaker 1: couple of months. I mean, at some point we are
Speaker 1: going to need we are going to need more stimulus.
Speaker 1: We are going to need these sort of cases to
Speaker 1: come down. But I think what we've seen so far
Speaker 1: is that, you know, we have a little bit of
Speaker 1: time here. Been great to catch up. As always staying bullish.
Speaker 1: Ben Later of Twahudson Research, Our next guest is really
Speaker 1: good look identifying when you come out of those ranges,
Speaker 1: and we haven't. We can bring Mike Swelling now, please
Speaker 1: bring the head a global fixed income portfolio management might
Speaker 1: greater to catch out with the SA I'm sure you've
Speaker 1: had a part of that. Can we just start with
Speaker 1: this ten year treasury range have been stuck in for
Speaker 1: a number of months now between fifty basis points and
Speaker 1: ninety five at a high end in early June. Might
Speaker 1: you think you've got the set up in front of
Speaker 1: us to break out of that, Sure, Jonathan, I don't
Speaker 1: think I can match last week's piano in my office
Speaker 1: is not large enough per piano, but like a play
Speaker 1: because if that makes your week um. In terms of
Speaker 1: the range on the bond market, I think that the
Speaker 1: death of the bond market rally has been just that
Speaker 1: story has been written way too many times. They're still
Speaker 1: they're still yield, They're still balanced in fix income relative
Speaker 1: to equities and other risk assets. And as long as
Speaker 1: you have investors that are long risk assets and need
Speaker 1: some level of diversification, as long as rates are zero
Speaker 1: negative almost everywhere in the world, the tenure Treasury at
Speaker 1: eighty basis points offers number one, balance for your portfolio
Speaker 1: and some hash efficacy. And secondly, there is yield in
Speaker 1: the thick thincome market. An eighty basis point may not
Speaker 1: sound like a lot, but if it rallies to thirty,
Speaker 1: that's a significant, significant total return. So I think that
Speaker 1: people are writing off the bottom market too early, and
Speaker 1: I think that right now with the tenure at eighty
Speaker 1: basis points, there is value there with a bit on
Speaker 1: hold for the pursuable future, and that's right where I
Speaker 1: wanted to go is within the internals of the market.
Speaker 1: We do that in the equity market all the time.
Speaker 1: What do you see on your desks of the appetite
Speaker 1: and the bid ask. I mean, there's a lot of
Speaker 1: money out there, I get that, But what are the
Speaker 1: internals you see in that bid that demand for fixed
Speaker 1: income paper? So we'll see a lot of the fixed
Speaker 1: income universe way overweight duration or way overweight treasuries. What
Speaker 1: we look at is we look at a lot of
Speaker 1: the funds that are out there and to see how
Speaker 1: much where they stand relative to the benchmark. And you're
Speaker 1: seeing investors right now anywhere between flat and somewhat short duration.
Speaker 1: So that from a technical standpoint is a very positive
Speaker 1: technical for for the bottom market. I would say that
Speaker 1: the other very very important point is kind of the
Speaker 1: volatility that we're seeing now in equity markets and that
Speaker 1: we're likely to see going into your end. It's likely
Speaker 1: to have a positive impact on the treasury market as
Speaker 1: investors look for flight to quality, and a near term
Speaker 1: it may even have a positive u uh tail wind
Speaker 1: towards the dollar as well as the flight to quality
Speaker 1: currency Here's what I'm struggling with, Mike. You say that
Speaker 1: there is probably going to be buying of treasuries, and
Speaker 1: you know, I was reading your notes and your bullish
Speaker 1: on high yield, your bush on the riskiest credit. Isn't
Speaker 1: there a contradiction here that if people are looking for
Speaker 1: the safety of treasuries at sub one yields, why would
Speaker 1: they be confident that they're going to get any of
Speaker 1: their money back with a high yield bond. Well, first off, um,
Speaker 1: there is a lot of merit to owning growth related
Speaker 1: assets and things like high yield that are have not
Speaker 1: benefited as much from the FED coming in buying everything
Speaker 1: in the investment grade universe, buying treasuries and buying mortgages.
Speaker 1: They've kind of been left out there, and there's still
Speaker 1: a decent amount of yield in the hospital market. The
Speaker 1: benefit of treasuries paired with credit is very, very significant.
Speaker 1: When you go long duration paired with credit, you actually
Speaker 1: create better balance in a portfolios. So the event that
Speaker 1: there is a risk off, actually treasuries would rally, and
Speaker 1: then the event that there is a improvement in growth
Speaker 1: and treasuries made back up, you would see credit spreads
Speaker 1: tighten very significantly. So number one, I don't think that
Speaker 1: that's an inconsistency. Secondly, I think that when you invest
Speaker 1: in things like high yield and other fixt income related
Speaker 1: assets that are not treasuries or agency mortgages that are
Speaker 1: very liquids, you think longer term and longer term, we
Speaker 1: do believe that you're gonna have um improvements in care
Speaker 1: for COVID, We're gonna get back to better growth next year,
Speaker 1: and so as a result, you want to stay long
Speaker 1: growth related assets. But as we look at what's setting
Speaker 1: up right now in terms of the potential for election volatility,
Speaker 1: the potential for funding issues at the end of the year,
Speaker 1: as banks are not in a great capital position to
Speaker 1: be able to provide a lot of liquid into markets,
Speaker 1: we actually want to be in a position where we
Speaker 1: have a little duration going into that. But you're also
Speaker 1: in a position where you have dry powder and take
Speaker 1: advantage of this location coming into at the end of
Speaker 1: the year. Hold on a second, let's unpack some of
Speaker 1: that you said dislocation into the end of the year.
Speaker 1: In other words, you're expecting some of the riskier credit
Speaker 1: to potentially sell off and potentially significantly heading into your end,
Speaker 1: and then you're gonna be buying what's your entry point.
Speaker 1: So I'm trying to divide the fixing com universe into two.
Speaker 1: One is the credit related assets, where you're relying upon
Speaker 1: growth improving next year, earning is improving on the margin
Speaker 1: and just getting paid back. And in trading credit, it's
Speaker 1: very hard to jump in and jump out pre election,
Speaker 1: post election going into your end. So long term, we
Speaker 1: still very much like owning credit. In the very mere term, though,
Speaker 1: we look at factors like volatility, and so we look
Speaker 1: at we look at vis we look at bit offer
Speaker 1: spread as Tom was talking about earlier, and we get
Speaker 1: a little concerned that there's gonna be bolatility going to
Speaker 1: the election, and it's likely to be baltilly going to
Speaker 1: your funding stamp on. So what we've done is instead
Speaker 1: of reducing positions in credit related assets which are going
Speaker 1: to be dependent upon growth and longer term, we're trying
Speaker 1: to free up balance sheet and portfolios to be in
Speaker 1: a position to take a match just location, and that
Speaker 1: may be even things that basic at um cash futures
Speaker 1: basis in the treasury market, something that blew up during
Speaker 1: the COVID crisis, blew up in previous funding crisis where
Speaker 1: you can earn very very attractive a term by deploying
Speaker 1: your on your balunt on radio and television. This morning
Speaker 1: our simulcast Michael Swell with us with Goldman Sex out
Speaker 1: of Brandis and LS a few years back. Mike Swell
Speaker 1: right now at LESA and I know with John Farrow's
Speaker 1: interview after interview, everybody says they're buying China debt. All
Speaker 1: my radars up just because everybody seems to be in
Speaker 1: the trade. What's the risk or what's the thought you
Speaker 1: have on what could be out there in two thousand
Speaker 1: for the certitude of owning China debt? Well, I think
Speaker 1: we have two factors that are risk to owning Chinese debt.
Speaker 1: One is the risk that growth and that the Chinese
Speaker 1: economy is very insular and continues to recover at a
Speaker 1: pace very different than the rest of the global economy,
Speaker 1: and the event that that does occur, that could create
Speaker 1: a situation where the Chinese Central Bank provides less accommodation
Speaker 1: and you actually see rates rides and inflation pick up
Speaker 1: in China. That's a that's a real risk. The other
Speaker 1: risk is that um from a credit standpoint, people get
Speaker 1: concerned again about China kind of the other side, and
Speaker 1: while the central bank has the ability to lower rate,
Speaker 1: you could have a situation where there's credit concern. I
Speaker 1: think that's less of a concern. In the end, rates
Speaker 1: are attractive in China. Rates are in the three and
Speaker 1: a quarter area. They're meaningfully higher than they are on
Speaker 1: the rest of the globe. We don't expect to see
Speaker 1: inflation running away in China, and so the real rate
Speaker 1: in a country like is actually somewhat attractive. I'm not
Speaker 1: overly concerned. That doesn't feel like a crowd of trade.
Speaker 1: Aren't a lot of investors that have the ability to
Speaker 1: be able to invest in China debt that you're that
Speaker 1: you're overly concerned that it can be one of these
Speaker 1: crowd of trade. But obviously, Mike Well, I got a question.
Speaker 1: You were a ginormous basketball player at Brandeis. Did you
Speaker 1: really cut practice once because you wanted to go see
Speaker 1: Al Gore? Did you really do that? Oh my god,
Speaker 1: you really did? Um nineteen eight the eight election, and uh,
Speaker 1: actually it was true. I actually worked on one of
Speaker 1: the presidents of campaigns and was very active and involved.
Speaker 1: There were about eight Democratic candidates at the time, and um,
Speaker 1: I actually did go to the coach, and the coach
Speaker 1: getting rolled his eyes and said, we don't do that here,
Speaker 1: We're here for basketball, and coach, no, I want to
Speaker 1: see I want to be out Gore. I want to
Speaker 1: hear about that new Green Deal thirty five years ago.
Speaker 1: Green Deal, it was really a thing, and so actually
Speaker 1: it is. And John Farrell I would say that. And
Speaker 1: ice basketball back then was the real deal. What are
Speaker 1: they doing final four? No, but it was a real deal,
Speaker 1: very competitive program. I would I would love to know
Speaker 1: what David Solomon would have to say if Greg if
Speaker 1: Mike gave him a quick cold and said I want
Speaker 1: to go to see a I say and talk about
Speaker 1: the great deal, you might not say that. I'm worried
Speaker 1: coming sex. Thank you, thank you very much. Right now
Speaker 1: to get things started, Gregory Peters joins us. He's with
Speaker 1: p JAM with real portfolio management, Money at Risk, FIST
Speaker 1: income ahead of multisector and strategy and he's one of
Speaker 1: Trophy set of awards over the years and and all
Speaker 1: that as well. Greg, I love, love, love what you say.
Speaker 1: This is a market assisting bondholders and not stockholders. What
Speaker 1: do you mean by that that policy and all of
Speaker 1: finance and capitalisms working for bond holders right now. Yeah.
Speaker 1: So I think we're in this environment still and we're
Speaker 1: talking about the path of the virus and rolling shutdowns
Speaker 1: and pullbacks and fiscal similus. I think what that really
Speaker 1: does at its core, it's really keep companies conservative, right,
Speaker 1: and being conservative benefits bond holders over equity holders. And
Speaker 1: so what you're continuing to see our companies worried about
Speaker 1: the path of the virus rightfully, so uh and so
Speaker 1: they're retrenching, uh and and and so you're not going
Speaker 1: to see the same type of activity where bond holders
Speaker 1: are put to the side, uh and equity holders are
Speaker 1: put forward. So I think that's the environment that we're in.
Speaker 1: I know it's perverse, but that's bond market investing. We've
Speaker 1: seen some huge bond issuance, some huge bond supply through
Speaker 1: through this pandemic from both investments gride and high. Can
Speaker 1: you do a distinction on what that money is being
Speaker 1: used for this time around and whether that plays into
Speaker 1: the argument you're making. That absolutely plays into the argument.
Speaker 1: So at the surface level, you see the headlines of
Speaker 1: all these issuance it's it's somewhat scared. But then when
Speaker 1: you look a little deeper, what you see or that
Speaker 1: companies are actually terming out their existing debt at lower
Speaker 1: coupons and paying down their higher coupon short debt. So
Speaker 1: in effect, what they're doing is that they're putting their
Speaker 1: balances in better shape, not worse shape. At the same
Speaker 1: time they are preparing for additional liquidity measures. And so
Speaker 1: those two things put together, I think put bond holders
Speaker 1: in a better place, not a worth place. So it's
Speaker 1: really what you're using the proceeds for. It's not like
Speaker 1: you're using the proceeds like you have in the past
Speaker 1: to buy back equity, right, So you're not doing that,
Speaker 1: and I think that intent and that purpose really benefits
Speaker 1: being a bond holder in here. Greg the credit market
Speaker 1: not a monolith. You've got investment grade corporate issuers perhaps
Speaker 1: doing what you say. On the high yield side, I've
Speaker 1: read an increasing number of articles about pick toggle deals.
Speaker 1: Basically if they don't want to pay their interests, they
Speaker 1: just put it on their debt balance. You see also
Speaker 1: recap divida a dividend recapitalizations. Basically private equity firms having
Speaker 1: their portfolio companies borrow more money to give them a payout.
Speaker 1: How does this fit into the conservativeness that you're talking about. Yeah,
Speaker 1: so I think you're always going to see that type
Speaker 1: of transaction, but it's not really happening in Moss. And
Speaker 1: so you can always pick to a certain deal that
Speaker 1: happened that's maybe pushing the limits, but it doesn't really
Speaker 1: tell you the broader story. And the broader story is
Speaker 1: the one that I just described, So I think that's
Speaker 1: the important piece of the puzzle. Don't don't get drawn
Speaker 1: in by these idiosyncratic kind of news stories. The broader
Speaker 1: story is want of balance sheet repair, and I think
Speaker 1: that's the driver. Let's push the politics through this conversation
Speaker 1: as well, correct going forward sector to sector, what you're
Speaker 1: looking at the moment and the kind of permitations that
Speaker 1: you guys are talking about A page Jim. As far
Speaker 1: as the election is concerned, Yeah, so the action obviously
Speaker 1: is that the four Really it boils down to what's
Speaker 1: the new regulatory construct and the tax construct? Um uh
Speaker 1: and so look, I mean I would I think it's
Speaker 1: a still worthy of kind of examination, But I just
Speaker 1: say a couple of things. Uh. First, and foremost is
Speaker 1: that I do think if you do have this kind
Speaker 1: of blue suite that seems to have really uh captivated
Speaker 1: the market in here, that does benefit the consumer as
Speaker 1: it could kind of fuel continued kind of wage growth
Speaker 1: and just economic growth. Um. But but the one area
Speaker 1: that we see differently than maybe the equity market in
Speaker 1: some other areas um is the financials. Uh So, to me,
Speaker 1: it's really hard to see a situation where there could
Speaker 1: be much more regulation to damage kind of the ability
Speaker 1: for financials to operate. So so my comment has been
Speaker 1: it's hard to kill the patient twice, and so I
Speaker 1: think it's really a pretty benign environment all else equal,
Speaker 1: if there is a leadership change on the financial side.
Speaker 1: And then finally on the energy front, this is highly controversial.
Speaker 1: Many investors are looking at energy. Obviously it was a
Speaker 1: center at the last debate, but the truth in the
Speaker 1: matter of the energy companies haven't really benefited either equity
Speaker 1: holders or bond holders over the past several years. So
Speaker 1: some kind of change in alteration in the spending mix
Speaker 1: and maybe being less profligate is isn't such a bad thing.
Speaker 1: So I'm actually pretty excited over the alpha opportunities within
Speaker 1: the energy space going forward, Greg, the great understanding is
Speaker 1: it bonds as a hedge don't work anymore, so I
Speaker 1: gotta go find something else, whether it's preferred bank prefers, etcetera,
Speaker 1: or forty seven other intangible assets as well. Is that
Speaker 1: gonna happen? I mean, a bond is a bond if
Speaker 1: fixed income as a hedge is is just what it is,
Speaker 1: a predictable stream of of cash flows. Can there be
Speaker 1: an alternative? I think there can, but it's way too early.
Speaker 1: So I agree with with Mike Swell who was on previously.
Speaker 1: I think it's way too early to call the death
Speaker 1: of the bond market. But this is really picking up
Speaker 1: steam as a story. But it you know, I mean,
Speaker 1: we're in an environment where real yields are negative, right,
Speaker 1: so the fact that you're getting you know, seventy fifty
Speaker 1: basis points depending on where you are in the curve,
Speaker 1: that matters a lot relative to that. So I still
Speaker 1: think bonds add a lot of value to the portfolil uh.
Speaker 1: And there's a thing called risk adjustment, So you are, um,
Speaker 1: you know, getting a return for a lot less risk,
Speaker 1: and I think that matters. So there's this big storyline
Speaker 1: going on around the death of the bond market, and
Speaker 1: sixty forty is dead. I think it's way too early
Speaker 1: for that. Uh. And bonds do what they're supposed to do.
Speaker 1: You see it today, UH, and I'll believe you know,
Speaker 1: you'll continue to see it. So UH. I'm so bullish
Speaker 1: on the outlook for bonds. And in fact, I mean
Speaker 1: I think it's going to be somewhat vaulatile here over
Speaker 1: the near term within a confined range. But I think
Speaker 1: that back in the curve has actually value here. UH.
Speaker 1: And so we're actually pretty constructive on the level of
Speaker 1: yields UH. In the US bond markets, bond specialists, bonds
Speaker 1: on Iva, Greg Fadist, Jim try to catch up what
Speaker 1: he said as the wise thank you right now. It
Speaker 1: is a great joy if you go to a fancy
Speaker 1: school like Harvard and you get a bunch of fancy degrees.
Speaker 1: If you are ever so lucky, you get to go
Speaker 1: to the founding school. That would be William and Mary
Speaker 1: and their Law school of seventeen seventy nine. It was
Speaker 1: an historic moment for the nation when a number of people,
Speaker 1: including Mr Jefferson, got together and said we have to
Speaker 1: be different, and they did that at william and Mary.
Speaker 1: Rebecca Green is at Williams Mary. She is the winner
Speaker 1: of their Acclaim Teaching Award given by graduate students, and
Speaker 1: that is a good and wonderful thing. Professor Green, thank
Speaker 1: you so much for joining us on election transparency. Can
Speaker 1: our radio listeners are television listeners? Can they be confident
Speaker 1: of safety at the voting booth on November three? Um? Well,
Speaker 1: first all, thank you for having me, um, And the
Speaker 1: second of all, absolutely they can. Um. Election officials and
Speaker 1: local governments have been working hard to ensure that we
Speaker 1: have a safe and secure election. There have been so
Speaker 1: many elections going back to the founding of a Wilamen
Speaker 1: Mary eight particularly eighteen twenty four and then on to
Speaker 1: two thousand twenty that are this fractious. Is it normal
Speaker 1: to be this angry where there's so much tension about
Speaker 1: our voting process? Um, you know, I would not say
Speaker 1: it's normal. We certainly do have a long history of
Speaker 1: problems at the polls, but um, it is, um the
Speaker 1: case I think that we're in, you know, a hyperpartisan
Speaker 1: mood and you know we uh, you know, we we
Speaker 1: certainly haven't seen anything um like UM. You know, regular
Speaker 1: comments emanating from the White House that there's a problem
Speaker 1: with our election administration. So so it certainly is a
Speaker 1: different tone than any previous election, at least in the
Speaker 1: modern era. Rebecca, there's a question about November three, it
Speaker 1: will be the last day of voting, and then there's
Speaker 1: a question about the weeks after that, as both sides
Speaker 1: of this campaign get their cavalry together to fight the
Speaker 1: legal foundations of this vote. What are some of the
Speaker 1: battles that you're expecting to see in the court based
Speaker 1: on both President Trump and former Vice President Biden's comments
Speaker 1: so far. Yeah, well, so, I think the first thing
Speaker 1: to say is that post election litigation is normal. It's
Speaker 1: part of our system. It's how we resolve disputes, and
Speaker 1: this country has a long history of resolving post election
Speaker 1: disputes in the courts. Um. You know, post election disputes
Speaker 1: are generally guided by state law, so you know it's
Speaker 1: for in in every state. How this will all unfold
Speaker 1: if it if it unfolds, Um, And you know there's
Speaker 1: there's um kind of three different Well, there's there's different
Speaker 1: kinds of you know, there's different types of post election litigation. So, um,
Speaker 1: you know, everyone is probably familiar with recounts when when
Speaker 1: you know, elections are closed, candidates can call for recounts,
Speaker 1: and again that process is governed by state law. UM.
Speaker 1: And then there are ways that candidates and campaigns can
Speaker 1: challenge um either you know, ballots or they can allege
Speaker 1: official misconduct. It's called different things in different states, but
Speaker 1: it's generally a contest or a protest or the words
Speaker 1: that are most often used. And so those are the
Speaker 1: various vehicles by which you can you know, challenge or um,
Speaker 1: you know, litigate an election result. And so we can
Speaker 1: we can expect, if it's close, we can expect to
Speaker 1: see um, you know one are both unfold. So there's
Speaker 1: a high likelihood that Amy Coney Barrett will get confirmed
Speaker 1: to the Supreme Court as soon as this evening, if
Speaker 1: she does passes through the SETI today. What's your expectation
Speaker 1: about a potential case that would come between the Supreme
Speaker 1: Court the way we saw back in two thousands, Well,
Speaker 1: you know, I think it's pretty unlikely that we see
Speaker 1: a two thousand like um, you know event. I mean,
Speaker 1: there would have to be a lot of circumstances that
Speaker 1: would coincide for that to come about. I mean, it's
Speaker 1: pretty extraordinary that the whole waste came down to Florida
Speaker 1: and that the you know, the race in Florida was
Speaker 1: was five and thirty seven votes, Um, you know spread.
Speaker 1: So I think, you know, the chances of lightning striking
Speaker 1: again seem pretty remote to me. Um. I think what's
Speaker 1: more likely is a case could end up at the
Speaker 1: Supreme Court that you know, deals with the fundamental powers
Speaker 1: of state legislatures versus state courts. That's a that's a
Speaker 1: kind of we've already seen a premonition of that with
Speaker 1: a four or four split last week on that question, UM,
Speaker 1: and that that could re emerge as you know, there's
Speaker 1: some unsettled questions about um, you know, authority in uh
Speaker 1: in elections in states. Rebecca Green, Brian Rosenthal, and Michael
Speaker 1: Rothfeldt in the New York Times this morning have an
Speaker 1: absolutely brilliant article on the nepotism involved in this case.
Speaker 1: It happens to be, I believe the City of New
Speaker 1: York election process and all that, how are we going
Speaker 1: to vote five or ten years? So, now do you have,
Speaker 1: in your expert view, a better way we're going to
Speaker 1: vote than the nepotism and the local, local, local politics
Speaker 1: of this nation's electoral process. Yeah, you know, it's pretty
Speaker 1: extraordinary when when we have foreign visitors come and look
Speaker 1: at our our election system, they're often amazed that we
Speaker 1: have this very decentralized and sort of partisan based election
Speaker 1: and meditation in this country. And it is many volumes
Speaker 1: have been written about how problematic, um it is for
Speaker 1: a lot of reasons. But on the other hand, you know,
Speaker 1: if you look two thousand sixteen and hopefully in two
Speaker 1: thousand twenty, one of the features of our system being
Speaker 1: so decentralized is that it's very hard to do anything
Speaker 1: to hermit from the outside, right because, um, you have
Speaker 1: to there's essentially ten thousand different elections in this country,
Speaker 1: and so that that kind of provides some protection in
Speaker 1: terms of the kinds of potential harms that we see. So, um,
Speaker 1: it's sort of a two sided coin in terms of
Speaker 1: reform and like what we might you know, what changes
Speaker 1: we might have. Um, you know, ten years from now,
Speaker 1: you could imagine, after this insane election season, that Congress
Speaker 1: decides to take a little bit more of a heavy
Speaker 1: hand in terms of mandating some certain basics in terms
Speaker 1: of how we how we run our elections. This is
Speaker 1: about a joy Rebecca Green, Thank you so much, Professor
Speaker 1: Green at the Law School of the College of William
Speaker 1: H and Mary. Thanks for listening to the Bloomberg Surveillance podcast.
Speaker 1: Subscribe and listen to interviews on Apple Podcasts, SoundCloud, or
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Speaker 1: Keane before the podcast. You can always catch us worldwide.
Speaker 1: I'm Bloomberg Radio.