WEBVTT - Bloomberg Surveillance TV: August 6th, 2026

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<v Speaker 1>Bloomberg Audio Studios, Podcasts, radio News.

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<v Speaker 2>This is the Bloomberg Surveillance Podcast. I'm Jonathan Ferrow, along

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<v Speaker 2>with Lisa Bromwitz and Amrie Hordert. Join us each day

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<v Speaker 2>for insight from the best in markets, economics, and geopolitics

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<v Speaker 2>from our global headquarters in New York City. We are

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<v Speaker 2>live on Bloomberg Television weekday mornings from six to nine

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<v Speaker 2>am Eastern. Subscribe to the podcast on Apple, Spotify or

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<v Speaker 2>anywhere else you listen, and as always on the Bloomberg

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<v Speaker 2>Terminal and the Bloomberg Business app. We begin this hour

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<v Speaker 2>with stocks hovering near all time highs. Bob Elliott of

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<v Speaker 2>Unlimited Funds right in the rotation isn't a sign of

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<v Speaker 2>resilience but misplaced optimism. As talks ramp up, folks ramp up,

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<v Speaker 2>the FOMO caution is warranted. Bob joins us now from

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<v Speaker 2>More Bob, good morning, going to see you. What are

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<v Speaker 2>your thoughts on this rotation so far? And do you

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<v Speaker 2>think we've had that so called clearing event that's going

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<v Speaker 2>to allow us to rally on a sustainable basis.

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<v Speaker 3>Like even a week ago, that we might be moving

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<v Speaker 3>towards to the point where we got a clearing of

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<v Speaker 3>the mania that existed in the AI and seventy sector,

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<v Speaker 3>and all of a sudden we're back to fomo and

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<v Speaker 3>catch up here. And that's really been the driver of

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<v Speaker 3>what's been going on in this market, is everyone is

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<v Speaker 3>so concerned about being behind the curve as prices go

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<v Speaker 3>higher and higher. It's classic bubble type activity. I'm calling

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<v Speaker 3>the top in a bubble a little challenging. Anyone who's

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<v Speaker 3>been in this business for long enough knows, but when

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<v Speaker 3>you see something like that, you've got to recognize that

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<v Speaker 3>levering in and going full bore on the bubble is

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<v Speaker 3>often an imprudent move.

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<v Speaker 2>You're colding get a bubble. Just to find why you're

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<v Speaker 2>colding at a bubble right now?

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<v Speaker 3>Well, I think a classic bubble is extremely high expectations, which,

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<v Speaker 3>to be clear, on earnings, we have the highest expectations

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<v Speaker 3>for earnings growth over the course of the next five

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<v Speaker 3>years that we've had in the post World War two era.

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<v Speaker 3>Extraordinary outcome is priced into these markets, combined with the

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<v Speaker 3>fact that people are using significant leverage to buy assets

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<v Speaker 3>because they're already full up on getting exposure to these names,

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<v Speaker 3>they have to go and add leverage, and that leverage

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<v Speaker 3>is everywhere. I wrote a recent piece of my subsett

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<v Speaker 3>called leverage leverage everywhere, right, And it's interesting. This isn't

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<v Speaker 3>the leverage of the GFC concentrated in highly levered banks.

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<v Speaker 3>This is like Wells Fargo giving significant amount of securities

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<v Speaker 3>leverage to their wealth clients. This is leverty TFS, this

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<v Speaker 3>is options trading. It's kind of everywhere and diffuse, so

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<v Speaker 3>it's hard to point to the exact place where all

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<v Speaker 3>the leverage is piling up, but it's kind of everywhere.

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<v Speaker 3>And that's a good sign that this market is overbought

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<v Speaker 3>on borrowed money.

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<v Speaker 1>So what'll make you think that actually is starting to

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<v Speaker 1>get cleared out? Because some people were saying that after

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<v Speaker 1>the declines that we had seen in some of the

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<v Speaker 1>chip names as well as the hyperscalers, and then of

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<v Speaker 1>course with situational awareness, that gave them the confidence to

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<v Speaker 1>go back.

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<v Speaker 4>In what are you watching?

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<v Speaker 1>That says, hold on a second, not so fast.

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<v Speaker 3>Well, I think one of the challenges is the rotation

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<v Speaker 3>means that the overall S and P five hundred earnings

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<v Speaker 3>expectations actually haven't changed that much. Right overall at the

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<v Speaker 3>economy wide level hasn't changed that much. We're just sort

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<v Speaker 3>of shuffling between whether the money goes to the AI

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<v Speaker 3>names or the hyperscalers, or.

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<v Speaker 4>To the real economy, let's say. And the challenge is

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<v Speaker 4>when the.

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<v Speaker 3>Overall expectations are so high at the economy wide level,

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<v Speaker 3>this shuffling can get confused and you might think, oh,

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<v Speaker 3>things have repriced, but in aggregate, we're still expecting over

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<v Speaker 3>twenty percent earnings growth for five consecutive years.

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<v Speaker 4>That an extraordinary outcome that's priced in.

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<v Speaker 1>But the earnings have actually been extraordinary, and it's actually

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<v Speaker 1>been some of the best earnings we've ever had outside

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<v Speaker 1>of a recovery period post crisis. Why do you think

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<v Speaker 1>that that is unsustainable, especially given where rates are here.

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<v Speaker 3>Well, you could have earnings for a quarter, you can

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<v Speaker 3>have earnings for two quarters. A lot of that stuff

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<v Speaker 3>is asset oriented earnings, right. A big chunk of the

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<v Speaker 3>earnings grow that we're seeing is, you know, basically holding

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<v Speaker 3>equity in other positions and booking that as earnings. And

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<v Speaker 3>so the question is not can you get earnings good

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<v Speaker 3>earnings one or two quarters. The question is can you

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<v Speaker 3>get it persistently? And if you think about twenty five

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<v Speaker 3>percent earnings growth, which is roughly what's priced in the

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<v Speaker 3>five year expectation. In order to get twenty five percent

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<v Speaker 3>earnings growth in an economy that's growing at six seven

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<v Speaker 3>percent nominal, you guys, either have to have one of

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<v Speaker 3>the most extraordinary expansions and margins ever seen in recorded history,

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<v Speaker 3>which will crush workers, or you have to have some

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<v Speaker 3>sort of productivity boom that has never been seen in

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<v Speaker 3>the history of humanity.

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<v Speaker 4>So, look, could that happen?

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<v Speaker 3>Sure, anything could happen, right, But the idea that extraordinary

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<v Speaker 3>is prices consensus.

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<v Speaker 4>That's the problem right now when.

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<v Speaker 5>You look at though, what's going on the memory makers.

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<v Speaker 5>The memory supply shortage is going to last and persist

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<v Speaker 5>into twenty twenty seven. Digit Times just had a whole

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<v Speaker 5>article about this. Doesn't that set up at least at

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<v Speaker 5>minimum next year to be an expansion of the AI trade.

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<v Speaker 3>Certainly you're getting good nominal growth out of that out

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<v Speaker 3>of that sector because there's supply constraints.

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<v Speaker 4>But the question is who's paying for it? Mean, see

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<v Speaker 4>as an.

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<v Speaker 3>Example, the relationship between all the AI related names, so

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<v Speaker 3>you have you know, open AI is basically financing.

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<v Speaker 4>Microsoft's entire.

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<v Speaker 3>Operate cloud operations, right, and so the question is Okay,

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<v Speaker 3>so if that's what's happening, everyone looks at Microsoft and says, oh,

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<v Speaker 3>things are going great. But then you're like, oh, it's

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<v Speaker 3>actually open Ai. That's buy and large financing that. And

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<v Speaker 3>then the question is who's paying open ai the type

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<v Speaker 3>of the type of cash that is being priced into

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<v Speaker 3>the expectations there that eventually make themselves to Microsoft. And

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<v Speaker 3>the question is will the real economy pay for the

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<v Speaker 3>type of expectations that are being built into the cap

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<v Speaker 3>expectations in the various sort of core providers. And that's

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<v Speaker 3>the real question, particularly in an environment when we're starting to

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<v Speaker 3>see challenger models that are just a hair off, you know,

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<v Speaker 3>the frontier models that are what one one hundredth one,

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<v Speaker 3>one thousandth one ten thousandth the price to accomplish the

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<v Speaker 3>same outcome. Like, why if you're in corporate America, would

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<v Speaker 3>you ever pay for a frontier model when you get

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<v Speaker 3>something slightly less efficient for one thousandth of cost.

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<v Speaker 2>Well, let's finish on the bond market, which told lots

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<v Speaker 2>about the Federal Reserve at the stand of the program,

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<v Speaker 2>are we on the brink of this bond market becoming

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<v Speaker 2>a problem.

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<v Speaker 3>Well, I think that's one of the questions is how

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<v Speaker 3>does this leverage bubble pop? And typically when you look

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<v Speaker 3>through time, it's all about the bond market. And so

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<v Speaker 3>I think one of the things when we see Secretary

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<v Speaker 3>Bestnt come out and try and sort of distract from

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<v Speaker 3>the core issue here. The core issue is there's too

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<v Speaker 3>much bond supply, yields are rising. And while he's often

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<v Speaker 3>sort of moves around in terms of what he focuses

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<v Speaker 3>on in terms of the market, you know you should

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<v Speaker 3>be focused on the gold market, because if there's one

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<v Speaker 3>thing the gold market is saying, it's saying, cut out

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<v Speaker 3>the nonsense, deliver the issuance that's necessary reprice the bond market.

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<v Speaker 3>And instead he seems very cautious along with his friend

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<v Speaker 3>in the Eccles building, who to actually deliver the type

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<v Speaker 3>of policy that's necessary to make the adjustments of this economy.

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<v Speaker 2>I thought he was an inspired choice to run Treasury

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<v Speaker 2>at the time. I still think that in many ways

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<v Speaker 2>he understands the situation where it's tilking about this morning

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<v Speaker 2>in places like Japan in the treasury market. Do you

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<v Speaker 2>sense he seems rattled in the last week in a

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<v Speaker 2>way that he hasn't been previously.

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<v Speaker 3>Well, I think he's a man of markets, right, and

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<v Speaker 3>he can see what's going on across the market. So

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<v Speaker 3>when he sees that simply from a FED hold, you

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<v Speaker 3>see the long end move a point or two and

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<v Speaker 3>then keep going, that's a real concern. He understands that,

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<v Speaker 3>I mean his work. It's odd that he's getting worked

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<v Speaker 3>up about using the FED to finance the Japanese intervention

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<v Speaker 3>because obviously he's going to do whatever it takes in

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<v Speaker 3>order to not have pressure on the long end of

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<v Speaker 3>the bond market as the Japanese intervene. And so I

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<v Speaker 3>think what's rattling him is the markets, and the markets

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<v Speaker 3>are sending a signal. If the FED doesn't deliver the

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<v Speaker 3>tightening that's necessary, if the Treasury doesn't deliver the duration

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<v Speaker 3>that's required, then what's going to happen is the bond

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<v Speaker 3>market is going to correct this market environment, and that

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<v Speaker 3>would be quite an unfortunate event for him if that

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<v Speaker 3>comes right into the midterms.

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<v Speaker 2>Stay with us. More Bloomberg surveillance coming up after this.

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<v Speaker 2>Brian hamlet'son the chair of the enterprise software firm Life Switch,

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<v Speaker 2>warning the share unlock reinforces some of the same concerns.

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<v Speaker 2>Rays that the IPO writing retail investors are being asked

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<v Speaker 2>to take significantly more valuation risk than employees and early

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<v Speaker 2>investors who received shares at much lower prices. Brian joined

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<v Speaker 2>us now for more. Brian, it's good to see you again.

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<v Speaker 2>When we spoke on the day of the IPO, I

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<v Speaker 2>remember you called it an extraordinary company that's extraordinarily overvalued.

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<v Speaker 4>Brian.

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<v Speaker 2>Do you still believe that's the case?

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<v Speaker 4>I think so. You know what a world we live in.

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<v Speaker 4>Look at the company.

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<v Speaker 6>They cut their losses in half, they doubled their revenue,

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<v Speaker 6>doubled their customers, and their stock price went down, as

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<v Speaker 6>you guys know, by about ten percent yesterday only on

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<v Speaker 6>Wall Street. You know what I mean. But look, here's

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<v Speaker 6>the big picture. These guys are still priced at fifty

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<v Speaker 6>times trailing sales of last year. So they're doing well

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<v Speaker 6>on an operating level, Jonathan, but they're still overpriced.

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<v Speaker 2>Let's talk about what they are doing, Brian. At an

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<v Speaker 2>operating level. There are several businesses in there, and Lisa

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<v Speaker 2>was talking about this earlier this week. How do you

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<v Speaker 2>value this company? I'm sure we had that conversation at

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<v Speaker 2>the time it went public. Yeah, is it a telecommunication company?

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<v Speaker 2>Is it going to be a growing neo cloud firm?

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<v Speaker 6>How do you look at it? Yes, it's all of that.

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<v Speaker 6>It's Elon Musky's joy ride. You know what I mean.

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<v Speaker 4>I love the guy.

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<v Speaker 6>What a great entrepreneur, but still overvalued and unpacking what

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<v Speaker 6>the company does. Good luck with that, you know what

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<v Speaker 6>I mean. But here's the thing, guys, look at this.

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<v Speaker 6>I will say I have to back off my thing

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<v Speaker 6>from a couple of months ago. As you guys know,

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<v Speaker 6>the price has been battered. I'm not surprised by that.

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<v Speaker 6>But at an operating level, they're doing great. It's you know,

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<v Speaker 6>here's the thing. It's a good company that's overvalued. It's

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<v Speaker 6>not complicated. It's a mishmash, as you mentioned, of a

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<v Speaker 6>bunch of things that Elon wants to do. Great entrepreneur,

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<v Speaker 6>but still super risky. Now, one last thing, I listened

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<v Speaker 6>to your last segment. It is true that about I

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<v Speaker 6>thought it was about seven percent by the way, by

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<v Speaker 6>my calculation. But there's a bunch of people who've been

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<v Speaker 6>in the company, they're employees and they're unlocking. But it's

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<v Speaker 6>I don't think that's going to be a material thing.

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<v Speaker 4>I could be wrong.

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<v Speaker 1>At the same time, there's a larger question here about

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<v Speaker 1>whether this is a SpaceX problem or whether this is

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<v Speaker 1>an endemic problem with a lot of big tech companies

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<v Speaker 1>that have solid businesses that are doing great things, but

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<v Speaker 1>are also promising to spend trillions of dollars in CAPEX

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<v Speaker 1>for plans that have not been realized yet in a

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<v Speaker 1>very competitive environment. At what point do you see some

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<v Speaker 1>of that as becoming increasingly a liability. I'm thinking of meta,

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<v Speaker 1>I'm thinking of others that are trying to expand their definitions.

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<v Speaker 6>I have always promised myself. I always say I don't

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<v Speaker 6>know when I don't know, and I don't know, so

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<v Speaker 6>I go to the fundamentals of the company. The losses

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<v Speaker 6>have been caught in half, and that's great, and there's

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<v Speaker 6>a ton of investment, and none of us on this

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<v Speaker 6>planet know whether this stuff is going.

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<v Speaker 4>To pay off.

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<v Speaker 6>I started early, guys in AI this is ancient history

0:11:14.880 --> 0:11:17.160
<v Speaker 6>twenty five years ago, but we don't know.

0:11:17.760 --> 0:11:18.480
<v Speaker 4>You were right.

0:11:18.600 --> 0:11:21.640
<v Speaker 6>All these companies are investing big time in AI AI.

0:11:21.679 --> 0:11:23.960
<v Speaker 4>I think they've got to do it. Will it pay off?

0:11:24.000 --> 0:11:24.560
<v Speaker 4>We don't know.

0:11:24.640 --> 0:11:27.160
<v Speaker 6>So that's why we drift back to how is this

0:11:27.200 --> 0:11:31.840
<v Speaker 6>company doing with customer acquisition profits in the basics.

0:11:31.600 --> 0:11:33.679
<v Speaker 1>At a certain point, there's also this war for talent,

0:11:33.679 --> 0:11:36.400
<v Speaker 1>and we just saw it with Google yesterday. We closely

0:11:36.440 --> 0:11:39.080
<v Speaker 1>see it with SpaceX. With this belief that Elon Musk

0:11:39.120 --> 0:11:42.920
<v Speaker 1>has a singularity and vision that can potentially propel the

0:11:43.040 --> 0:11:45.800
<v Speaker 1>names hire and realize these dreams. I just wonder, do

0:11:45.840 --> 0:11:48.720
<v Speaker 1>you think that some of the individual talent is being

0:11:48.720 --> 0:11:50.960
<v Speaker 1>overvalued when you see things like these one hundred million

0:11:51.000 --> 0:11:54.280
<v Speaker 1>dollars payouts for some of the AI specialists.

0:11:55.120 --> 0:12:00.679
<v Speaker 6>Yes, yes, but again, this is an arms race. This

0:12:00.760 --> 0:12:04.320
<v Speaker 6>happens in every great industry, automobiles one hundred years ago.

0:12:04.880 --> 0:12:07.920
<v Speaker 6>You get all this growth and what's happening, You're going

0:12:08.000 --> 0:12:10.960
<v Speaker 6>to have fewer, fewer companies, and they're all fighting for talent.

0:12:11.480 --> 0:12:14.199
<v Speaker 6>So these people are overpaid, there's no question on one

0:12:14.200 --> 0:12:15.960
<v Speaker 6>of them. You know, I was one of them.

0:12:16.000 --> 0:12:17.240
<v Speaker 4>But that's the way it is.

0:12:17.280 --> 0:12:20.600
<v Speaker 6>I mean, because you know, that's the beautiful thing about tech,

0:12:20.640 --> 0:12:22.880
<v Speaker 6>as you know, is it's intellectual property.

0:12:22.960 --> 0:12:23.760
<v Speaker 4>So if they can get the.

0:12:23.720 --> 0:12:27.240
<v Speaker 6>Best talent, there's a non linear relationship with how that

0:12:27.320 --> 0:12:28.480
<v Speaker 6>company will be valued.

0:12:29.040 --> 0:12:32.520
<v Speaker 2>Stay with us, mult Bloomberg surveillance coming up after this.

0:12:41.800 --> 0:12:42.559
<v Speaker 4>So here's the latest.

0:12:42.600 --> 0:12:45.680
<v Speaker 2>This morning, investors a waiting July payrolls data, as mixed

0:12:45.720 --> 0:12:49.199
<v Speaker 2>employment data complicates the fence policy path. The latest ABP

0:12:49.280 --> 0:12:52.880
<v Speaker 2>employment report coming in below expectations but suggesting those looking

0:12:52.880 --> 0:12:55.679
<v Speaker 2>for new jobs are getting rewarded maybe. Richardson of ABP

0:12:55.800 --> 0:12:59.679
<v Speaker 2>writing job changes are highly sensitive to real time economic conditions,

0:13:00.000 --> 0:13:02.960
<v Speaker 2>and the rapid pay growth implies supply constraints in parts

0:13:03.280 --> 0:13:05.320
<v Speaker 2>of the labor market. Nia joins us now for more.

0:13:05.400 --> 0:13:05.920
<v Speaker 4>Nat A good morning.

0:13:06.480 --> 0:13:08.400
<v Speaker 2>It's two data points that I love in the labor market.

0:13:08.679 --> 0:13:10.840
<v Speaker 2>One is quits and the other is the pay that

0:13:10.880 --> 0:13:12.640
<v Speaker 2>you get for switching your job. Because I want to

0:13:12.640 --> 0:13:15.839
<v Speaker 2>see confidence in the labor market. You see some confidence

0:13:16.040 --> 0:13:18.240
<v Speaker 2>pick up slowly, well.

0:13:18.200 --> 0:13:21.680
<v Speaker 7>A little bit. I mean that seven percent number is remarkable.

0:13:21.720 --> 0:13:23.920
<v Speaker 7>We haven't seen that level of pay growth for a

0:13:24.000 --> 0:13:27.079
<v Speaker 7>job changers since August of twenty twenty five. So when

0:13:27.120 --> 0:13:29.720
<v Speaker 7>we saw that number, it jumped out to us. It

0:13:29.760 --> 0:13:32.400
<v Speaker 7>was the biggest number in that report in our view.

0:13:32.640 --> 0:13:34.240
<v Speaker 7>I know a lot of people looked at the forty

0:13:34.240 --> 0:13:36.599
<v Speaker 7>four thousand and said, oh, that's a mess.

0:13:37.320 --> 0:13:37.839
<v Speaker 4>It's not a.

0:13:37.800 --> 0:13:40.240
<v Speaker 7>Miss for us. Because we've been tracking it every week.

0:13:40.280 --> 0:13:42.360
<v Speaker 7>So if people were paying attention, that's where you and

0:13:42.440 --> 0:13:45.319
<v Speaker 7>have landed. But what was remarkable was the fact that

0:13:45.360 --> 0:13:49.240
<v Speaker 7>this labor market is tighter than job gains suggest. And

0:13:49.320 --> 0:13:52.679
<v Speaker 7>so when you're looking at the number, either with ADP

0:13:52.960 --> 0:13:56.280
<v Speaker 7>or on Friday, it's the why that's important. Is this

0:13:56.520 --> 0:13:59.320
<v Speaker 7>a low or high number because demand is high or.

0:13:59.200 --> 0:14:01.160
<v Speaker 4>Low, or so apply is hire low.

0:14:01.360 --> 0:14:04.680
<v Speaker 7>Supply is a big factor, which is why that job

0:14:04.760 --> 0:14:05.520
<v Speaker 7>changeer pay growth is.

0:14:05.640 --> 0:14:07.480
<v Speaker 2>Can you flash that out a little bit more, how

0:14:07.559 --> 0:14:10.640
<v Speaker 2>much the supply bakdrop has shifted in the past twelve

0:14:10.640 --> 0:14:11.160
<v Speaker 2>months or suck.

0:14:11.240 --> 0:14:13.360
<v Speaker 7>Probably the best way to do that is through an

0:14:13.440 --> 0:14:17.280
<v Speaker 7>actual example in construction. So we're seeing the hiring rate

0:14:17.520 --> 0:14:21.560
<v Speaker 7>for new construction workers high. It's the highest job changer

0:14:21.640 --> 0:14:25.200
<v Speaker 7>pay growth we track. It's almost fourteen percent. That's the

0:14:25.280 --> 0:14:29.000
<v Speaker 7>highest we've seen on record. And yet the number of

0:14:29.120 --> 0:14:31.960
<v Speaker 7>jobs that were created in July was a thousand.

0:14:32.360 --> 0:14:33.560
<v Speaker 4>That's a big.

0:14:33.320 --> 0:14:36.320
<v Speaker 7>Acceleration from the second quarter. There's just not enough people

0:14:36.320 --> 0:14:40.200
<v Speaker 7>to hire. People are retiring out of that field. It's

0:14:40.240 --> 0:14:42.920
<v Speaker 7>a field that is aging rapidly, and so what the

0:14:43.000 --> 0:14:47.080
<v Speaker 7>hiring rates suggest is replacement hiring rather than new jobs.

0:14:47.280 --> 0:14:50.040
<v Speaker 7>So the signals are muddled. They're not telling you what

0:14:50.120 --> 0:14:53.520
<v Speaker 7>they typically tell you because a lot is going on

0:14:53.600 --> 0:14:54.040
<v Speaker 7>in the slave.

0:14:54.400 --> 0:14:56.280
<v Speaker 1>In the past, when we saw the headline number, you

0:14:56.360 --> 0:14:58.000
<v Speaker 1>pull the hood back and what you get is a

0:14:58.000 --> 0:15:01.120
<v Speaker 1>lot of education and healthcare jobs. And that isn't exactly

0:15:01.200 --> 0:15:04.280
<v Speaker 1>a robust signal about the overall economy, since it's a

0:15:04.320 --> 0:15:07.240
<v Speaker 1>more static pool independent of the economic cycle.

0:15:07.560 --> 0:15:08.960
<v Speaker 4>Has that started to shift at all.

0:15:09.360 --> 0:15:13.280
<v Speaker 7>Yes, we saw a deceleration and it's mostly driven by healthcare.

0:15:13.320 --> 0:15:17.120
<v Speaker 7>It's mostly driven by these aging demographics that are overlaying

0:15:17.160 --> 0:15:20.520
<v Speaker 7>their hire labor marke care. And we actually saw this

0:15:20.600 --> 0:15:23.280
<v Speaker 7>pattern last year too. We saw a shift down in

0:15:23.400 --> 0:15:26.800
<v Speaker 7>July and then acceleration in the fall. This is something

0:15:26.840 --> 0:15:30.280
<v Speaker 7>that's also very interesting about the labor market because there's

0:15:30.280 --> 0:15:34.760
<v Speaker 7>so many macroeconomic shocks and trends that are hard to call.

0:15:35.200 --> 0:15:39.920
<v Speaker 7>Firms are changing their hiring patterns. When they hire is

0:15:40.000 --> 0:15:43.640
<v Speaker 7>not typical anymore. They're hiring strategically. It's like firms are

0:15:43.640 --> 0:15:46.520
<v Speaker 7>playing dodgeball with all the macro news and they're going

0:15:46.560 --> 0:15:49.720
<v Speaker 7>to shift and shift, and so a strong hiring month

0:15:49.840 --> 0:15:53.440
<v Speaker 7>in one month like in spring may be followed by

0:15:53.480 --> 0:15:56.640
<v Speaker 7>a weaker hiring month just to balance it out.

0:15:56.720 --> 0:15:58.560
<v Speaker 1>What I thought was fascinating in your data is that

0:15:58.640 --> 0:16:01.160
<v Speaker 1>you show that healthcare is do selllerated, but that white

0:16:01.160 --> 0:16:03.680
<v Speaker 1>collar jobs have actually reaccelerated, and sort of this question

0:16:03.720 --> 0:16:06.640
<v Speaker 1>of AI not exactly having the same kind of ramification

0:16:07.400 --> 0:16:10.360
<v Speaker 1>on the business community as people previously thought.

0:16:10.720 --> 0:16:13.160
<v Speaker 7>Right, So we track this really closely. We track it

0:16:13.200 --> 0:16:15.560
<v Speaker 7>with our partners at Stanford in this what we call

0:16:15.600 --> 0:16:18.240
<v Speaker 7>the Canaries dashboard. But when you look at the overall

0:16:18.320 --> 0:16:23.720
<v Speaker 7>labor market, finance information, professional business services actually increased jobs

0:16:23.760 --> 0:16:27.600
<v Speaker 7>relative to the second quarter. So yes, AI is having

0:16:27.600 --> 0:16:31.080
<v Speaker 7>an impact, but it's not this brand sweep of impact

0:16:31.120 --> 0:16:34.200
<v Speaker 7>that is part of the popular narrative. Those jobs actually

0:16:34.200 --> 0:16:36.520
<v Speaker 7>accelerated and the pay is following as well.

0:16:36.560 --> 0:16:38.800
<v Speaker 5>Where employers caught off guard then because a lot of

0:16:38.800 --> 0:16:40.880
<v Speaker 5>them do feel like they were holding back. They thought

0:16:40.920 --> 0:16:43.000
<v Speaker 5>AI was going to have to replace these workers and

0:16:43.000 --> 0:16:45.400
<v Speaker 5>they're realizing they're not, and now they're have to actually

0:16:45.440 --> 0:16:47.560
<v Speaker 5>have to go to the market and pay even more

0:16:47.600 --> 0:16:48.400
<v Speaker 5>to get that talent.

0:16:48.720 --> 0:16:52.040
<v Speaker 7>Yeah, I think employers have been caught off guard by AI,

0:16:52.680 --> 0:16:58.960
<v Speaker 7>by interest rates, by geopolitics, by you know, consumer sentiment,

0:16:59.600 --> 0:17:03.400
<v Speaker 7>are cautious consumer. There's so many things that they're navigating

0:17:03.480 --> 0:17:06.359
<v Speaker 7>right now, and that's why they're changing their hiring patterns

0:17:06.480 --> 0:17:08.480
<v Speaker 7>a little differently. So when we look at a number

0:17:08.520 --> 0:17:11.840
<v Speaker 7>like forty four thousand in July, we don't rest there

0:17:12.280 --> 0:17:15.000
<v Speaker 7>because there's so much going on under the surface of

0:17:15.040 --> 0:17:15.600
<v Speaker 7>that number.

0:17:15.760 --> 0:17:17.840
<v Speaker 5>How much also is it the employers have to pay

0:17:17.920 --> 0:17:20.639
<v Speaker 5>up because they have to not just attract new talent

0:17:20.680 --> 0:17:23.640
<v Speaker 5>but also keep in line and some with inflation.

0:17:23.560 --> 0:17:28.200
<v Speaker 7>The competitive environment for especially in places where there are

0:17:28.200 --> 0:17:31.600
<v Speaker 7>supply gaps, is really extreme because you're not just talking

0:17:31.600 --> 0:17:34.640
<v Speaker 7>about a local market. We're talking about a national, sometimes

0:17:34.720 --> 0:17:38.640
<v Speaker 7>global market for talent. This hybrid bridwork thing is a

0:17:38.680 --> 0:17:39.520
<v Speaker 7>real factor.

0:17:39.720 --> 0:17:41.160
<v Speaker 4>Now, it's a.

0:17:41.040 --> 0:17:44.399
<v Speaker 7>Live factor, and so not only do you have a

0:17:44.440 --> 0:17:48.080
<v Speaker 7>wider talent pool as an employer, so does the person

0:17:48.080 --> 0:17:52.080
<v Speaker 7>you're trying to recruit. And we know from the research

0:17:52.160 --> 0:17:56.199
<v Speaker 7>that we're doing. The way workers outpace inflation is the

0:17:56.320 --> 0:17:59.080
<v Speaker 7>change stops because you get that pay them. And so

0:17:59.200 --> 0:18:03.320
<v Speaker 7>if inflation is higher than normal and the competitive landscape

0:18:03.359 --> 0:18:06.320
<v Speaker 7>in some sectors is tighter than normal, you are going

0:18:06.359 --> 0:18:08.240
<v Speaker 7>to see that kind of acceleration in pain.

0:18:09.119 --> 0:18:12.680
<v Speaker 2>This is the Bloomberg surveillance podcast, bringing you the best

0:18:12.680 --> 0:18:16.000
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0:18:16.040 --> 0:18:19.000
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