1
00:00:05,120 --> 00:00:09,200
Speaker 1: Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keene along

2
00:00:09,200 --> 00:00:13,080
Speaker 1: with Jonathan Ferrell and Lisa Brownwitz Jay Lee. We bring

3
00:00:13,119 --> 00:00:17,159
Speaker 1: you insight from the best and economics, finance, investment, and

4
00:00:17,280 --> 00:00:23,280
Speaker 1: international relations. Find Bloomberg Surveillance, an Apple podcast, Suncloud, Bloomberg

5
00:00:23,360 --> 00:00:29,120
Speaker 1: dot com and of course on the Bloomberg Tournament. Please

6
00:00:29,120 --> 00:00:30,840
Speaker 1: talk about the pandemic was still and we can do

7
00:00:30,840 --> 00:00:34,360
Speaker 1: that with Rick Bright, the Rockefeller Foundation Pandemic Prevention and

8
00:00:34,520 --> 00:00:37,800
Speaker 1: Response Senior Vice President. Great to have you with us

9
00:00:37,880 --> 00:00:40,279
Speaker 1: on the program. Sir, I want to start with how

10
00:00:40,320 --> 00:00:43,040
Speaker 1: you're working with the current administration and the difference since

11
00:00:43,080 --> 00:00:47,400
Speaker 1: you're experiencing from working with the previous administration as well.

12
00:00:47,400 --> 00:00:48,920
Speaker 1: What are you learning so far and what are the

13
00:00:48,960 --> 00:00:52,320
Speaker 1: additional things you've been able to achieve. Well, thanks for

14
00:00:52,360 --> 00:00:54,960
Speaker 1: having me this morning, in this afternoon around the world.

15
00:00:55,320 --> 00:00:59,320
Speaker 1: It's really a stark difference between this administration and last administration.

16
00:00:59,640 --> 00:01:02,640
Speaker 1: It isn't a secret, um that I had my frustrations

17
00:01:02,680 --> 00:01:05,959
Speaker 1: with the slow rollout of overall response to the pandemic,

18
00:01:06,400 --> 00:01:09,640
Speaker 1: and they just continued to increase my frustrations as we

19
00:01:09,880 --> 00:01:13,200
Speaker 1: missed the ball and getting testing across our country getting

20
00:01:13,280 --> 00:01:17,319
Speaker 1: vaccines made and getting vaccine rollout. What we see now

21
00:01:17,480 --> 00:01:21,720
Speaker 1: with the Divide administration is a complete one eight turnaround,

22
00:01:22,080 --> 00:01:24,840
Speaker 1: a lot of communication with the state and local levels

23
00:01:24,880 --> 00:01:28,960
Speaker 1: from the federal government, a lot of collaboration, transparency, and

24
00:01:28,959 --> 00:01:31,800
Speaker 1: you're starting to see that payoff and dividends with the

25
00:01:31,880 --> 00:01:34,920
Speaker 1: rollout of the vaccine. We have more than double of

26
00:01:35,000 --> 00:01:38,920
Speaker 1: the vaccination right now that we had on January. We

27
00:01:39,000 --> 00:01:42,440
Speaker 1: have more people getting treated, we have more testing being done.

28
00:01:42,760 --> 00:01:45,160
Speaker 1: In the passage of this American Rescue Plan is a

29
00:01:45,200 --> 00:01:49,320
Speaker 1: true commitment to accelerating on all engines, all all cylinders,

30
00:01:49,360 --> 00:01:51,480
Speaker 1: to make sure we can end the pandemic. We struggled

31
00:01:51,520 --> 00:01:53,640
Speaker 1: with testing in the United Kingdom, but seem to do

32
00:01:53,680 --> 00:01:56,600
Speaker 1: a much better job with sequencing and understanding variants much

33
00:01:56,600 --> 00:01:58,880
Speaker 1: more quickly than other countries. Sat down that was in

34
00:01:58,880 --> 00:02:01,320
Speaker 1: the UK, Rick and I just want to the United States,

35
00:02:01,600 --> 00:02:03,920
Speaker 1: can we do a better job down in your experience

36
00:02:03,920 --> 00:02:07,120
Speaker 1: that we're doing that right now? We absolutely have to

37
00:02:07,120 --> 00:02:09,280
Speaker 1: do a better job. That is the big blind spot

38
00:02:09,320 --> 00:02:11,160
Speaker 1: that we have right now with this pandemic in the

39
00:02:11,240 --> 00:02:14,359
Speaker 1: United States and around the world. We haven't been doing

40
00:02:14,440 --> 00:02:17,360
Speaker 1: enough sequencing, we haven't been targeting the sequencing to the

41
00:02:17,480 --> 00:02:21,440
Speaker 1: right populations. What we're finding is these variants are now emerging,

42
00:02:21,760 --> 00:02:23,720
Speaker 1: and we're finding them in parts of the United States.

43
00:02:23,760 --> 00:02:26,160
Speaker 1: And if you backtrack, well, we realize they were in

44
00:02:26,160 --> 00:02:30,000
Speaker 1: the United States for two or four months. They're widespread

45
00:02:30,040 --> 00:02:32,680
Speaker 1: before we even know they're here, they're upon us. We

46
00:02:32,760 --> 00:02:34,839
Speaker 1: know the threat of these variants. We know that they

47
00:02:34,840 --> 00:02:37,960
Speaker 1: can transmit more readily. We know that some of them

48
00:02:37,960 --> 00:02:41,080
Speaker 1: can evade some of the vaccine immunity that we're seeing

49
00:02:41,120 --> 00:02:43,800
Speaker 1: from the vaccines and the therapeutics. So we have to

50
00:02:43,840 --> 00:02:46,760
Speaker 1: get in front of them. The United States hasn't been

51
00:02:46,760 --> 00:02:50,280
Speaker 1: done a good job. The CDC, however, did announce recently

52
00:02:50,320 --> 00:02:53,520
Speaker 1: they would invest more in the sequencing for the United States.

53
00:02:53,960 --> 00:02:57,680
Speaker 1: And really importantly, the Rockefeller Foundation has been working hand

54
00:02:57,720 --> 00:03:01,480
Speaker 1: in hand with the US government to one um come

55
00:03:01,520 --> 00:03:04,440
Speaker 1: up with new testing strategies to use testing and screening

56
00:03:04,440 --> 00:03:07,720
Speaker 1: and testing to reopen our schools. Number two that that

57
00:03:07,919 --> 00:03:12,040
Speaker 1: testing leads to identification in more cases. And then just

58
00:03:12,160 --> 00:03:15,799
Speaker 1: a couple of weeks ago, Rockefeller Foundation hosted a conference

59
00:03:15,880 --> 00:03:19,760
Speaker 1: with the government and private sector and public sector to

60
00:03:19,840 --> 00:03:22,560
Speaker 1: identify the challenges we have in the United States to

61
00:03:23,120 --> 00:03:26,560
Speaker 1: improve our sequencing, and not just a sequencing itself, but

62
00:03:26,639 --> 00:03:29,280
Speaker 1: how we analyze it, how we communicate it, and how

63
00:03:29,320 --> 00:03:33,080
Speaker 1: we tie it to the downstream. So so what type

64
00:03:33,120 --> 00:03:36,480
Speaker 1: of question. Every mutation isn't impactful, but we do need

65
00:03:36,520 --> 00:03:38,360
Speaker 1: to know the ones that are, and we need to

66
00:03:38,360 --> 00:03:41,280
Speaker 1: know where they are so we can in front of them. Rick,

67
00:03:41,400 --> 00:03:44,720
Speaker 1: there's one thing about analysis and identification. There's another thing

68
00:03:44,720 --> 00:03:47,000
Speaker 1: about prevention. And this goes to this question of how

69
00:03:47,040 --> 00:03:49,600
Speaker 1: international the effort of vaccination has to be. The idea

70
00:03:49,680 --> 00:03:51,920
Speaker 1: that the United States is doing really well, it is

71
00:03:51,960 --> 00:03:54,040
Speaker 1: doing much much better than Europe and a lot of

72
00:03:54,080 --> 00:03:57,040
Speaker 1: the most of the developing world. How much do you

73
00:03:57,120 --> 00:03:59,600
Speaker 1: think the US needs to do in order to get

74
00:03:59,720 --> 00:04:02,640
Speaker 1: vaccin scenes out to some of the less wealthy parts

75
00:04:02,640 --> 00:04:04,280
Speaker 1: of the world in order to prevent some of these

76
00:04:04,360 --> 00:04:07,640
Speaker 1: variants from being established, from frankly mutating in the first

77
00:04:07,640 --> 00:04:11,400
Speaker 1: place and gaining a foothold. It sounds like you've been

78
00:04:11,400 --> 00:04:14,600
Speaker 1: working on pandemic prevention for quite a while. So that's

79
00:04:14,600 --> 00:04:19,360
Speaker 1: a critical Actually, that's a critical point, and and it's

80
00:04:19,400 --> 00:04:21,680
Speaker 1: something that gets lost in the news, gets lost in

81
00:04:21,720 --> 00:04:25,839
Speaker 1: the enthusiasm for increasing a vaccination rate in a wealthy

82
00:04:25,880 --> 00:04:29,920
Speaker 1: country in the country that has vaccine production within the borders,

83
00:04:30,040 --> 00:04:33,120
Speaker 1: and we can vaccinate everyone in the United States, but

84
00:04:33,160 --> 00:04:36,200
Speaker 1: we are still extremely vulnerable to this virus and to

85
00:04:36,320 --> 00:04:40,039
Speaker 1: we vaccinate a sufficient level people around the world. The

86
00:04:40,120 --> 00:04:43,400
Speaker 1: virus likes to mutate, and a mutates in people mostly

87
00:04:43,440 --> 00:04:47,240
Speaker 1: who haven't been vaccinated. That's what infects more readily. And

88
00:04:47,440 --> 00:04:50,440
Speaker 1: if the virus mutates and its circles in some part

89
00:04:50,440 --> 00:04:53,080
Speaker 1: of the world is not covered with vaccines, and that

90
00:04:53,160 --> 00:04:56,599
Speaker 1: virus circulates back into into the United States and it's

91
00:04:56,680 --> 00:05:00,480
Speaker 1: changed in some way. We can see reinfections, can see

92
00:05:00,640 --> 00:05:04,040
Speaker 1: escape from the immunity from our vaccine. So it's a

93
00:05:04,120 --> 00:05:07,880
Speaker 1: real crisis. This pandemic will not end anywhere in the

94
00:05:07,920 --> 00:05:11,279
Speaker 1: world until we ended everywhere in the world. And that's

95
00:05:11,279 --> 00:05:14,400
Speaker 1: a critical part on the global picture for vaccinations. Rick,

96
00:05:14,440 --> 00:05:16,080
Speaker 1: before we let you go, want to finish on something

97
00:05:16,160 --> 00:05:18,760
Speaker 1: really sensitive and quite important. I think one thing that's

98
00:05:18,800 --> 00:05:21,280
Speaker 1: been lost over the last twelve months increasingly as trust,

99
00:05:21,640 --> 00:05:24,960
Speaker 1: trust and institutions, and trust and officials as well. You've

100
00:05:25,000 --> 00:05:28,279
Speaker 1: worked with both governments. I understand that you had worked

101
00:05:28,279 --> 00:05:31,039
Speaker 1: with President Biden in the initial COVID task Force, and

102
00:05:31,240 --> 00:05:34,240
Speaker 1: as we know you worked with the Trump government, the

103
00:05:34,240 --> 00:05:36,440
Speaker 1: Trump administration as well, And when you quit, you said

104
00:05:36,480 --> 00:05:39,600
Speaker 1: the following that some of the decisions being made with dangerous,

105
00:05:39,640 --> 00:05:41,599
Speaker 1: reckless and causing lives to be lost. And it was

106
00:05:41,600 --> 00:05:43,720
Speaker 1: the interference of politics in science. And I think one

107
00:05:43,720 --> 00:05:46,000
Speaker 1: thing that people struggle with right now when they hear

108
00:05:46,000 --> 00:05:48,640
Speaker 1: a policymaker speak, even the President of the United States currently,

109
00:05:49,000 --> 00:05:52,479
Speaker 1: is it driven by politics or driven by science? When

110
00:05:52,520 --> 00:05:54,760
Speaker 1: he says July four, we can get together it to again.

111
00:05:55,360 --> 00:05:57,440
Speaker 1: Is that just about sending out a nice message to

112
00:05:57,480 --> 00:06:00,680
Speaker 1: the public, or is that driven by science. What I

113
00:06:00,720 --> 00:06:03,800
Speaker 1: see the difference in President Biden President Trump is their

114
00:06:03,800 --> 00:06:07,240
Speaker 1: ability and willingness to listen to the scientists. And when

115
00:06:07,279 --> 00:06:10,360
Speaker 1: President Biden nounced says that he can meet a target

116
00:06:10,400 --> 00:06:12,680
Speaker 1: and meet a goal, you can bet that he's vetted

117
00:06:12,720 --> 00:06:15,479
Speaker 1: it with the scientists. You can bet Dr Faucci, the

118
00:06:15,480 --> 00:06:18,120
Speaker 1: scientists at n I H and CDC and FDA BARDA

119
00:06:18,200 --> 00:06:21,200
Speaker 1: have weighed in on that goal. And when he sets

120
00:06:21,200 --> 00:06:23,760
Speaker 1: the goal, I do think sometimes it's an ambitious goal,

121
00:06:24,160 --> 00:06:27,159
Speaker 1: but we should be ambitious in stopping this pandemic. So

122
00:06:27,240 --> 00:06:30,280
Speaker 1: I believe when he sets it out, we can achieve it.

123
00:06:30,320 --> 00:06:32,560
Speaker 1: But we're gonna have to work really hard to get there.

124
00:06:32,600 --> 00:06:34,760
Speaker 1: It's gonna take every one of us. It can't be

125
00:06:34,800 --> 00:06:37,839
Speaker 1: a policymaker or just a government that achieves that goal.

126
00:06:38,279 --> 00:06:40,160
Speaker 1: Each of us has a role. We have to wear

127
00:06:40,160 --> 00:06:43,680
Speaker 1: our mask. We have the social distance with Voyd crowds.

128
00:06:43,800 --> 00:06:46,520
Speaker 1: Everything that we need to do that's been bringing down

129
00:06:46,520 --> 00:06:48,880
Speaker 1: that curve. We need to keep doing it to take

130
00:06:48,880 --> 00:06:51,280
Speaker 1: that curve all the way to the baseline while we

131
00:06:51,560 --> 00:06:54,720
Speaker 1: accelerate our vaccination rates. That's how we'll achieve that goal

132
00:06:54,880 --> 00:06:58,200
Speaker 1: July four. If we all work together, would love to work.

133
00:06:58,240 --> 00:06:59,880
Speaker 1: We get some mole in the weeks some months ahead

134
00:07:00,200 --> 00:07:07,560
Speaker 1: right there at the Rockefeller Foundation, and I hand joined

135
00:07:07,600 --> 00:07:10,680
Speaker 1: us now ons Fargo Securities equity strategist. And for some

136
00:07:10,720 --> 00:07:13,000
Speaker 1: people this story has got boring. Been talking about it

137
00:07:13,000 --> 00:07:15,280
Speaker 1: since the early part of November. We've just ripped in

138
00:07:15,360 --> 00:07:18,280
Speaker 1: cyclical small caps out performing the NAT stacks struggling. We're

139
00:07:18,280 --> 00:07:20,680
Speaker 1: seeing that again this morning. When do things start to

140
00:07:20,760 --> 00:07:23,880
Speaker 1: change for you, Anna, Well, when we see how well

141
00:07:23,880 --> 00:07:26,200
Speaker 1: a trade has performed, you know, the good news is

142
00:07:26,280 --> 00:07:29,600
Speaker 1: it's working. The bad news become well. That opportunity or

143
00:07:29,600 --> 00:07:32,440
Speaker 1: the juice you saw has mostly been squeezed out. So

144
00:07:32,480 --> 00:07:35,280
Speaker 1: for us, what we're looking forward to is maybe less

145
00:07:35,320 --> 00:07:37,840
Speaker 1: so much of the value trade still on it, but

146
00:07:37,880 --> 00:07:40,560
Speaker 1: we're starting to get interested in other parts of the market,

147
00:07:40,800 --> 00:07:43,320
Speaker 1: other drivers. And for us, we think that next game

148
00:07:43,360 --> 00:07:46,360
Speaker 1: in town could be earnings expectations. Let's talk about that.

149
00:07:46,360 --> 00:07:48,960
Speaker 1: What do you see the opportunity around ownings expectations as

150
00:07:48,960 --> 00:07:51,960
Speaker 1: we get deeper into the year. Well, for us, it's

151
00:07:52,080 --> 00:07:54,600
Speaker 1: playing a little bit more of that kind of mid cycle,

152
00:07:54,720 --> 00:07:58,920
Speaker 1: mid recovery place because the first early cycle stuff tends

153
00:07:58,920 --> 00:08:01,240
Speaker 1: to have the early urge as you see, you know,

154
00:08:01,280 --> 00:08:04,640
Speaker 1: growth prospects improved, as you see more confidence build up,

155
00:08:04,720 --> 00:08:08,200
Speaker 1: economic recovery, the things that are most sensitive kind of

156
00:08:08,280 --> 00:08:11,120
Speaker 1: what's gonna move first, A lot of that has occurred.

157
00:08:11,160 --> 00:08:13,920
Speaker 1: So for us now becomes the things that come next

158
00:08:14,120 --> 00:08:16,600
Speaker 1: that comes with more reopening. So an example of that

159
00:08:16,640 --> 00:08:20,520
Speaker 1: could be the aerospace industry and also the consumer services

160
00:08:20,560 --> 00:08:23,480
Speaker 1: that has a lot to do with hotels, restaurants. You

161
00:08:23,520 --> 00:08:26,160
Speaker 1: see these areas where people are going to be are

162
00:08:26,280 --> 00:08:28,960
Speaker 1: looking forward to spending their money, especially now they have

163
00:08:29,040 --> 00:08:31,360
Speaker 1: that it is an all stimulus check. So and this

164
00:08:31,480 --> 00:08:34,000
Speaker 1: story makes sense, and then you see game stuff as

165
00:08:34,040 --> 00:08:36,800
Speaker 1: John was talking about the fourth biggest holding in the

166
00:08:36,880 --> 00:08:39,839
Speaker 1: rustle two thousand and Perhaps people will go buy more

167
00:08:39,840 --> 00:08:42,400
Speaker 1: games at stores or AMC. Perhaps peop will be going

168
00:08:42,440 --> 00:08:45,080
Speaker 1: to theaters, but they've been affected by different stories as well.

169
00:08:45,240 --> 00:08:47,760
Speaker 1: How much do you buy into the meme stocks expecting

170
00:08:47,800 --> 00:08:50,160
Speaker 1: some of the stimulus checks to feed into people's bank

171
00:08:50,160 --> 00:08:53,720
Speaker 1: accounts and directly into Robin Hood versus fight against this

172
00:08:54,120 --> 00:08:58,320
Speaker 1: and say the fundamentals do not justify this price action. Well,

173
00:08:58,360 --> 00:08:59,880
Speaker 1: you know, it kind of reminds me of like the

174
00:09:00,040 --> 00:09:03,640
Speaker 1: Kings and Beauty contest concept here, where you know everyone

175
00:09:03,760 --> 00:09:06,720
Speaker 1: is liking it, so must be good. Um. But something

176
00:09:06,720 --> 00:09:08,600
Speaker 1: to keep in mind too is I think it's actually

177
00:09:08,640 --> 00:09:12,040
Speaker 1: part of one big picture. As people have high savings rates,

178
00:09:12,200 --> 00:09:15,280
Speaker 1: they have high real disposable income, then you're adding on

179
00:09:15,360 --> 00:09:18,520
Speaker 1: top of that additional stimulus. Certainly, some of that direct

180
00:09:18,559 --> 00:09:21,040
Speaker 1: check is going to be used for bridging the gap,

181
00:09:21,320 --> 00:09:23,320
Speaker 1: but another part of that is going to be used

182
00:09:23,360 --> 00:09:27,480
Speaker 1: not just on experiences going out buying things for themselves, um,

183
00:09:27,520 --> 00:09:31,160
Speaker 1: but also on taking a little more higher risk playing

184
00:09:31,160 --> 00:09:33,840
Speaker 1: it in the equity market. And keep in mind, what's

185
00:09:33,840 --> 00:09:36,959
Speaker 1: really helpful for retail traders in the equity market is that.

186
00:09:37,240 --> 00:09:40,000
Speaker 1: You know, the more sophisticated the investor is, you can

187
00:09:40,120 --> 00:09:44,240
Speaker 1: use leverage product. Think about the retail flow and options markets.

188
00:09:44,440 --> 00:09:47,440
Speaker 1: You're able to use leverage products and get multiples of

189
00:09:47,440 --> 00:09:49,920
Speaker 1: what you put in. So that's could be an attractive

190
00:09:50,000 --> 00:09:52,559
Speaker 1: risk reward for a lot of retail traders and a

191
00:09:53,160 --> 00:09:57,679
Speaker 1: leverage checks going into companies that are considered zombies or

192
00:09:57,720 --> 00:10:01,080
Speaker 1: perhaps even insolvent. And by all other account how much

193
00:10:01,280 --> 00:10:03,880
Speaker 1: does what happens over the next couple of months determine

194
00:10:03,920 --> 00:10:06,400
Speaker 1: the pain later on when people assess the longer term

195
00:10:06,440 --> 00:10:10,520
Speaker 1: prospects for the economy. I think it's very important, Lisa,

196
00:10:10,600 --> 00:10:12,880
Speaker 1: and you think about that. You don't want to be

197
00:10:12,880 --> 00:10:15,560
Speaker 1: putting money in zombie companies. You want to avoid those

198
00:10:15,600 --> 00:10:18,440
Speaker 1: things we call them value traps um. You know, they

199
00:10:18,480 --> 00:10:21,240
Speaker 1: can really hurt you later on when you're just spraying

200
00:10:21,320 --> 00:10:24,160
Speaker 1: and praying. But you know, right now, it looks like

201
00:10:24,640 --> 00:10:27,600
Speaker 1: so far, the financial system is pretty solid, our banks

202
00:10:27,600 --> 00:10:30,480
Speaker 1: are pretty solid. You're not seeing too much strain there

203
00:10:31,000 --> 00:10:33,160
Speaker 1: um when it comes to you know, uh, you know,

204
00:10:33,320 --> 00:10:36,720
Speaker 1: miss appropriate cash to you know, risky companies going under.

205
00:10:36,800 --> 00:10:39,680
Speaker 1: So right now it's looking okay, but it's definitely a

206
00:10:39,720 --> 00:10:41,440
Speaker 1: soft spot that you always got to keep an eye

207
00:10:41,440 --> 00:10:43,200
Speaker 1: on and I always great to catch up with you.

208
00:10:43,280 --> 00:10:45,000
Speaker 1: Send out regards to Chris One. You and I have

209
00:10:45,160 --> 00:10:48,160
Speaker 1: that last Faco Securities equity strategist on the outlook cover

210
00:10:48,280 --> 00:10:56,000
Speaker 1: wilst Faco Michael Holland joining us now holding the company

211
00:10:56,080 --> 00:10:58,800
Speaker 1: Chairman Michael. We caught up with Amby Joseph Cohen of

212
00:10:58,880 --> 00:11:01,439
Speaker 1: Government Saxility this week and a question I asked her,

213
00:11:01,559 --> 00:11:03,640
Speaker 1: I want to ask it of you as well. You

214
00:11:03,679 --> 00:11:06,360
Speaker 1: have seen it all in your decades on Wall Street,

215
00:11:06,880 --> 00:11:08,960
Speaker 1: and I think it would really be helpful for us

216
00:11:09,000 --> 00:11:11,920
Speaker 1: if you could frame just how unique, truly unique original

217
00:11:12,280 --> 00:11:17,720
Speaker 1: this moment is as we throw everything at this recounty. Jonathan,

218
00:11:17,760 --> 00:11:20,959
Speaker 1: thank you, besaudes the corner. I've been around Bossard for

219
00:11:21,000 --> 00:11:23,720
Speaker 1: about the same amount of time, which is forever, and

220
00:11:23,920 --> 00:11:28,000
Speaker 1: the reality is is always different. Each time is different.

221
00:11:28,000 --> 00:11:32,040
Speaker 1: So that's what keeps it interesting and keeps us humble. Uh,

222
00:11:32,200 --> 00:11:35,200
Speaker 1: she said, Brothers, since this is quite humble. I think

223
00:11:35,280 --> 00:11:38,440
Speaker 1: this time around. What what she and I could could

224
00:11:38,559 --> 00:11:41,880
Speaker 1: observe is that we are in the early stages of

225
00:11:41,920 --> 00:11:45,120
Speaker 1: a major recovery around the world. Were your word global

226
00:11:45,160 --> 00:11:49,120
Speaker 1: from before the earnings increases, could easily surprise to the

227
00:11:49,240 --> 00:11:52,240
Speaker 1: upside over the next twelve months. We talked about a

228
00:11:52,280 --> 00:11:55,680
Speaker 1: five point five percent median figure for the US. That's

229
00:11:55,720 --> 00:11:58,640
Speaker 1: probably way understated for the GDP goats over the next

230
00:11:58,640 --> 00:12:02,640
Speaker 1: twelve months. And fin me and most importantly is the

231
00:12:02,720 --> 00:12:06,319
Speaker 1: vaccine news in the US is, if you were pointing

232
00:12:06,360 --> 00:12:08,959
Speaker 1: out just a few minutes ago, continues to surprise to

233
00:12:09,000 --> 00:12:12,000
Speaker 1: the upside relative to the rest of the world, particularly Europe.

234
00:12:12,440 --> 00:12:17,600
Speaker 1: The unknowable is rising rates. What will they do to

235
00:12:17,720 --> 00:12:21,120
Speaker 1: stock valuations? And for listeners and viewers if they didn't

236
00:12:21,160 --> 00:12:24,520
Speaker 1: hear Uh earlier in the week, Sebastian Page whom you

237
00:12:24,600 --> 00:12:29,600
Speaker 1: had on the show. He pointed out the good numbers

238
00:12:29,640 --> 00:12:32,440
Speaker 1: that over the last twenty years when rates are rising,

239
00:12:32,520 --> 00:12:35,960
Speaker 1: you're just as likely to get the stock market increased

240
00:12:36,000 --> 00:12:38,640
Speaker 1: as it pulled to a stock market decrease relative to Pe.

241
00:12:39,040 --> 00:12:42,800
Speaker 1: So that's the unknown, especially in the other kind of

242
00:12:42,800 --> 00:12:44,640
Speaker 1: the cycle. Michael, and to jump in, I think we've

243
00:12:44,640 --> 00:12:47,480
Speaker 1: got to talk about the cycle and the additional unique

244
00:12:47,480 --> 00:12:49,880
Speaker 1: part of this recovery is just how quickly things move.

245
00:12:50,200 --> 00:12:51,760
Speaker 1: And Mike, I think we had a snapshot of that

246
00:12:51,840 --> 00:12:53,360
Speaker 1: last year, and I just wonder what the lesson was

247
00:12:53,400 --> 00:12:56,439
Speaker 1: for you, we can snap back really quickly from this pandemic.

248
00:12:56,480 --> 00:12:57,839
Speaker 1: We had a little bit of a hint of that

249
00:12:58,040 --> 00:13:00,360
Speaker 1: center of that last year before things had to slow

250
00:13:00,440 --> 00:13:02,760
Speaker 1: down again. The speed of the cycle, Markel, can you

251
00:13:02,880 --> 00:13:05,559
Speaker 1: told to that the speed of the recovery that you're expecting.

252
00:13:07,880 --> 00:13:11,520
Speaker 1: That's the wonderful thing about these things as they change

253
00:13:11,559 --> 00:13:15,400
Speaker 1: and experiencing new things every time in cycles, Jonga, This

254
00:13:15,520 --> 00:13:19,600
Speaker 1: time around, I expect uber uger speed. I think the

255
00:13:20,000 --> 00:13:23,960
Speaker 1: I think the the recovery by the fourth of July

256
00:13:24,080 --> 00:13:28,800
Speaker 1: to use President bodies of goal line is very likely

257
00:13:28,840 --> 00:13:32,000
Speaker 1: to occur, and maybe even even sooner. We're just getting

258
00:13:32,280 --> 00:13:34,680
Speaker 1: such good news on the vaccine front in the US,

259
00:13:35,240 --> 00:13:37,840
Speaker 1: and that's I think that's uh just one of the

260
00:13:38,120 --> 00:13:40,040
Speaker 1: one of the not the major key to to what

261
00:13:40,160 --> 00:13:43,800
Speaker 1: you just answered, because it's coming with a pardon my phrase,

262
00:13:43,920 --> 00:13:48,440
Speaker 1: work speed. Well, you know, there's really interesting conundrum here

263
00:13:48,520 --> 00:13:52,079
Speaker 1: for investors that the incredible boom that you're talking about

264
00:13:52,480 --> 00:13:54,960
Speaker 1: is pretty well accepted and being accepted more and more

265
00:13:55,040 --> 00:13:58,040
Speaker 1: every day, and yet how to translate that into investment

266
00:13:58,040 --> 00:14:02,000
Speaker 1: thesis becomes more complicated. Your resume is basically a tutorial

267
00:14:02,000 --> 00:14:05,199
Speaker 1: of fund management whether it's the State Street UH passively

268
00:14:05,200 --> 00:14:08,400
Speaker 1: managed funds, or whether it's a black Stones alternative asset

269
00:14:08,440 --> 00:14:10,680
Speaker 1: management at the head of that, and Michael, I'm wondering

270
00:14:10,720 --> 00:14:13,960
Speaker 1: from your perspective, how the best way to play this now?

271
00:14:14,200 --> 00:14:16,320
Speaker 1: Is this a time of active management or do you

272
00:14:16,360 --> 00:14:18,960
Speaker 1: still see a role of passive really coming to the

273
00:14:18,960 --> 00:14:21,920
Speaker 1: fore based on the idea that lower yields means that

274
00:14:22,000 --> 00:14:24,800
Speaker 1: lower fees is better and that frankly, there still is

275
00:14:25,040 --> 00:14:29,480
Speaker 1: that huge alpha and beta play together. Yeah, I don't

276
00:14:29,520 --> 00:14:31,760
Speaker 1: think it's a binary thing, he said. I don't. I

277
00:14:31,760 --> 00:14:35,440
Speaker 1: don't think it's active or passive. Um. I have evolved

278
00:14:35,440 --> 00:14:38,800
Speaker 1: over the decades into both, and I think they are

279
00:14:39,520 --> 00:14:43,920
Speaker 1: perfectly appropriate places to use passive. I'm on the board

280
00:14:43,960 --> 00:14:46,520
Speaker 1: down at Vanguard, and for some stuff that they do,

281
00:14:47,200 --> 00:14:49,280
Speaker 1: I'm a huge fan of that. But I think there

282
00:14:49,320 --> 00:14:51,920
Speaker 1: are people and there are times when you can you

283
00:14:51,960 --> 00:14:56,160
Speaker 1: can appropriately say something is really cheap and I would

284
00:14:56,160 --> 00:14:58,640
Speaker 1: like to buy it, or to the contrary, you know

285
00:14:58,720 --> 00:15:01,040
Speaker 1: it's way overvalued. Now I'm going to sell it. So

286
00:15:01,080 --> 00:15:03,880
Speaker 1: I've been fortunate enough to be able to do to

287
00:15:04,440 --> 00:15:06,520
Speaker 1: do vote and have the freedom to do vote. I

288
00:15:06,520 --> 00:15:09,960
Speaker 1: think you're you're common about the asset management business. The

289
00:15:10,040 --> 00:15:13,160
Speaker 1: fund management business is perfectly We're not We're not going

290
00:15:13,200 --> 00:15:16,440
Speaker 1: to see any reversal of key reduction over over time.

291
00:15:16,520 --> 00:15:19,200
Speaker 1: I think that, uh, we're going to continue because it

292
00:15:20,000 --> 00:15:22,160
Speaker 1: just doesn't make sense to be paiding high seeds for

293
00:15:22,600 --> 00:15:24,800
Speaker 1: the sort of numbers that the majority of people have

294
00:15:24,840 --> 00:15:27,720
Speaker 1: been receiving over the decades. So I think I think

295
00:15:28,240 --> 00:15:32,600
Speaker 1: logic is in place. Well, so there's a snundrum here also, Michael,

296
00:15:32,640 --> 00:15:35,840
Speaker 1: for the likes of pension funds or for example, college endowments,

297
00:15:35,880 --> 00:15:37,840
Speaker 1: and I know that you had experienced with the Harvard

298
00:15:37,880 --> 00:15:42,160
Speaker 1: College Fund looking at returns in the future, there need

299
00:15:42,200 --> 00:15:45,600
Speaker 1: to be higher returns and the benchmark in benchmark yields

300
00:15:45,600 --> 00:15:48,680
Speaker 1: would imply. And so a growing number of pensions and

301
00:15:48,760 --> 00:15:51,840
Speaker 1: other institutions are going to the private markets, which charge

302
00:15:51,920 --> 00:15:56,120
Speaker 1: higher fees. What would your recommendation be for a situation

303
00:15:56,160 --> 00:16:00,720
Speaker 1: like that at a time of yields sub two percent? Well,

304
00:16:01,400 --> 00:16:05,120
Speaker 1: you can't, you can't make a case for traditional fixed

305
00:16:05,120 --> 00:16:09,240
Speaker 1: income uh in the environment where people have those kinds

306
00:16:09,240 --> 00:16:12,080
Speaker 1: of acquired returns. The fact at LEASTA there's questions, So

307
00:16:12,200 --> 00:16:15,360
Speaker 1: wels is being asked day after day. Uh. In the

308
00:16:15,480 --> 00:16:19,920
Speaker 1: endowment world. Uh, if you can't uh see yourself to

309
00:16:19,920 --> 00:16:22,160
Speaker 1: a four or five percent pay out, what do you

310
00:16:22,200 --> 00:16:23,920
Speaker 1: do when you go out to respectrum and you go

311
00:16:23,960 --> 00:16:26,280
Speaker 1: to private equity, and you go to venture capital. But

312
00:16:26,320 --> 00:16:28,920
Speaker 1: those those have been priced up. So I think at

313
00:16:28,960 --> 00:16:31,880
Speaker 1: the very least, do a reality check if you're on

314
00:16:31,920 --> 00:16:33,560
Speaker 1: the board of one of these things that you're managing

315
00:16:33,600 --> 00:16:35,560
Speaker 1: one of these things, that it's possible we're gonna have

316
00:16:35,600 --> 00:16:37,600
Speaker 1: a period of time there where we're gonna underperform what

317
00:16:37,680 --> 00:16:40,600
Speaker 1: we would like to do. Having said that, you said

318
00:16:40,640 --> 00:16:43,040
Speaker 1: it doesn't mean to stop trying, but you try to.

319
00:16:43,160 --> 00:16:45,800
Speaker 1: You continue to work really hard to find the really

320
00:16:45,840 --> 00:16:51,200
Speaker 1: smartest people in the world and unfortunately usually discovered. Jonathan

321
00:16:51,480 --> 00:16:55,600
Speaker 1: talked about earlier warp speed with technology and information. I

322
00:16:55,720 --> 00:16:59,000
Speaker 1: think get found pretty quickly. But the best people in

323
00:16:59,000 --> 00:17:01,520
Speaker 1: the world have to have to be have to be used,

324
00:17:01,520 --> 00:17:03,000
Speaker 1: and I think at the end of the day, I

325
00:17:03,040 --> 00:17:06,919
Speaker 1: think those expectations have to be ratcheted down. Michael, You know,

326
00:17:06,960 --> 00:17:09,800
Speaker 1: I really respect and appreciate your experience, and it's fantastic

327
00:17:09,840 --> 00:17:12,080
Speaker 1: always just to sit here and listen to everything you've

328
00:17:12,119 --> 00:17:20,320
Speaker 1: got to say. Michael Holland. There Holland Company, Chairman bla

329
00:17:20,359 --> 00:17:25,840
Speaker 1: Arena Rucci, Barclay's senior US economist, uh Lorena, thank you

330
00:17:25,920 --> 00:17:27,760
Speaker 1: so much for joining us here. I'd love to get

331
00:17:27,800 --> 00:17:30,040
Speaker 1: your thoughts. I'm sure your clients are reaching out to

332
00:17:30,119 --> 00:17:33,800
Speaker 1: you saying, talk to me about inflation. Where do I

333
00:17:33,840 --> 00:17:35,560
Speaker 1: need to be concerned? Where do I need to look

334
00:17:35,560 --> 00:17:37,960
Speaker 1: to see if inflation is creeping into this economy? What

335
00:17:38,040 --> 00:17:41,960
Speaker 1: are you telling your clients? Good morning and thanks for

336
00:17:42,000 --> 00:17:45,719
Speaker 1: having me today. That's a great question. Certainly, interest on

337
00:17:45,800 --> 00:17:49,800
Speaker 1: inflation trends has increased a lot recently. I'd like to

338
00:17:49,840 --> 00:17:53,119
Speaker 1: tell people that there is there are two parts to this.

339
00:17:53,320 --> 00:17:58,639
Speaker 1: There is an inflation narrative where people are very bullish inflation,

340
00:17:58,680 --> 00:18:03,080
Speaker 1: and there is the actual realize inflation data and inflation trends.

341
00:18:03,640 --> 00:18:07,800
Speaker 1: What we're seeing right now is inflation and pressures. Underlying

342
00:18:07,840 --> 00:18:12,439
Speaker 1: price pressures in the economy still being rather subdued and

343
00:18:13,280 --> 00:18:18,440
Speaker 1: quite low relative to the FEDS target. We're seeing pockets

344
00:18:18,480 --> 00:18:22,880
Speaker 1: of the economy producing strong price pressures, particularly on the

345
00:18:22,920 --> 00:18:26,280
Speaker 1: good side of the economy. And this is where I

346
00:18:26,320 --> 00:18:29,240
Speaker 1: tell people to look for rising price pressures and to

347
00:18:29,720 --> 00:18:32,680
Speaker 1: prepare to see that in the realized data. And that

348
00:18:32,720 --> 00:18:36,919
Speaker 1: makes sense to US, we have some supply chain bottlenecks

349
00:18:36,920 --> 00:18:41,520
Speaker 1: as more demands comes online for goods. We have some

350
00:18:41,840 --> 00:18:46,480
Speaker 1: rising shipping cost globally and higher global commodity prices. We're

351
00:18:46,480 --> 00:18:51,480
Speaker 1: seeing increased price pressures from import prices China, pp I,

352
00:18:51,680 --> 00:18:54,720
Speaker 1: U U S C p I. But what is lagging

353
00:18:54,800 --> 00:18:58,000
Speaker 1: for the US is the services side of the economy

354
00:18:58,080 --> 00:19:01,400
Speaker 1: that's lagging in terms of demand and in terms of inflation,

355
00:19:01,960 --> 00:19:04,440
Speaker 1: and the services side of the economy it's a much

356
00:19:04,480 --> 00:19:09,159
Speaker 1: bigger portion of US demand and US inflation. So until

357
00:19:09,240 --> 00:19:12,119
Speaker 1: we see that rising, I don't think we need to

358
00:19:12,160 --> 00:19:17,480
Speaker 1: be concerned about a very strong spike in inflation pressures. Blurrya,

359
00:19:17,560 --> 00:19:20,280
Speaker 1: can you talk a little bit about the friction in

360
00:19:20,359 --> 00:19:24,280
Speaker 1: bringing services back online in force. I'm thinking about this

361
00:19:24,320 --> 00:19:26,800
Speaker 1: summer and the plans and people you know, making their

362
00:19:26,880 --> 00:19:29,840
Speaker 1: travel arrangements right now at a time when you've got

363
00:19:29,880 --> 00:19:35,080
Speaker 1: consumers receiving four checks every month for the next few

364
00:19:35,080 --> 00:19:39,639
Speaker 1: months from the government free money, how quickly can services

365
00:19:39,760 --> 00:19:43,359
Speaker 1: come back based on the need to hire qualified people

366
00:19:43,840 --> 00:19:47,920
Speaker 1: in mass in such a short period of time. Yeah,

367
00:19:47,960 --> 00:19:50,600
Speaker 1: that's a very good point, And what we need to

368
00:19:50,720 --> 00:19:56,400
Speaker 1: highlight is that US consumers have this cash cash buffer

369
00:19:56,600 --> 00:19:59,280
Speaker 1: that has been building up. There is no doubt about that.

370
00:19:59,320 --> 00:20:01,840
Speaker 1: There is a lot of excess savings in the economy.

371
00:20:02,280 --> 00:20:05,320
Speaker 1: They're one of the reasons why we're not seeing spending

372
00:20:05,400 --> 00:20:08,560
Speaker 1: and employment in the services sector is that there isn't

373
00:20:08,600 --> 00:20:13,200
Speaker 1: that confidence to come out and spend on services where

374
00:20:13,200 --> 00:20:16,480
Speaker 1: you have to interact socially more. I think once we

375
00:20:16,600 --> 00:20:20,240
Speaker 1: have critical mass in terms of vaccination and population immunity,

376
00:20:20,800 --> 00:20:24,400
Speaker 1: this demand is likely going to come back, and so

377
00:20:24,440 --> 00:20:26,840
Speaker 1: we expect that in the second half of the year

378
00:20:26,880 --> 00:20:30,240
Speaker 1: there's going to be some friction here where demand comes back,

379
00:20:30,280 --> 00:20:33,960
Speaker 1: but supply has a little bit of trouble adjusting because

380
00:20:34,119 --> 00:20:37,080
Speaker 1: it's going to be tied to hire as many workers

381
00:20:37,119 --> 00:20:39,840
Speaker 1: as you need and businesses need to readjust to the

382
00:20:39,880 --> 00:20:44,480
Speaker 1: new world. So this could bring some price pressures in

383
00:20:44,520 --> 00:20:47,119
Speaker 1: the services sector, and this is what we expect. We

384
00:20:47,160 --> 00:20:50,080
Speaker 1: expect in the second half of the year, a shift

385
00:20:50,160 --> 00:20:53,399
Speaker 1: from the good sector to the services sector, both for

386
00:20:53,600 --> 00:20:58,000
Speaker 1: demand and inflationary pressures. But for us, the key is

387
00:20:58,600 --> 00:21:01,800
Speaker 1: this is going to be a one of transitory spike

388
00:21:02,040 --> 00:21:05,320
Speaker 1: or a sustained one, and we are on the first camp.

389
00:21:05,440 --> 00:21:08,600
Speaker 1: We think as the economy opens up, we're going to

390
00:21:08,680 --> 00:21:11,720
Speaker 1: see this spike that is going to be transitory, but

391
00:21:11,840 --> 00:21:15,480
Speaker 1: it's not going to lead to sustained higher inflation in

392
00:21:15,520 --> 00:21:18,320
Speaker 1: the US. But I mean, i'd love to get your

393
00:21:18,359 --> 00:21:21,320
Speaker 1: thoughts on kind of the employment environment we had. Yesterday's

394
00:21:21,359 --> 00:21:25,119
Speaker 1: jobles claims came in there. The trend is better, but

395
00:21:25,200 --> 00:21:29,159
Speaker 1: still it over seven hundred thousand jobles claims stubbornly stubbornly

396
00:21:29,440 --> 00:21:31,960
Speaker 1: high and appoints to you know, perhaps some of those

397
00:21:32,000 --> 00:21:35,520
Speaker 1: folks that are been unemployed for a longer period of time,

398
00:21:35,600 --> 00:21:38,280
Speaker 1: suggesting that they may not be able to come back

399
00:21:38,320 --> 00:21:40,160
Speaker 1: that easily into the workforce. How do you think about

400
00:21:40,200 --> 00:21:45,320
Speaker 1: the employment environment in this country as we begin to reopen. Yes, right,

401
00:21:45,440 --> 00:21:49,640
Speaker 1: we've made progress, and that's important to highlight, going from

402
00:21:49,680 --> 00:21:54,960
Speaker 1: double digit unemployment rates late last year early last year

403
00:21:55,680 --> 00:21:59,440
Speaker 1: to where we are now, which is uh well into

404
00:21:59,480 --> 00:22:03,119
Speaker 1: the single digits. But as you said, there needs to

405
00:22:03,160 --> 00:22:06,560
Speaker 1: be more progressed to be made, and the challenges for

406
00:22:06,680 --> 00:22:11,320
Speaker 1: me are around employment. Again, going back to the services factor,

407
00:22:11,800 --> 00:22:14,520
Speaker 1: we know that some pockets of the labor market have

408
00:22:14,680 --> 00:22:19,720
Speaker 1: been hardest hit, like hospitality, uh and travel, and those

409
00:22:19,800 --> 00:22:23,879
Speaker 1: workers need to come back online. What we're seeing is

410
00:22:24,000 --> 00:22:28,639
Speaker 1: also arise in long term unemployment and also a decline

411
00:22:28,680 --> 00:22:32,360
Speaker 1: in the labor force participation rate. Those workers that are

412
00:22:32,400 --> 00:22:36,000
Speaker 1: discouraged by high unemployment rate and I'm not even looking

413
00:22:36,000 --> 00:22:39,520
Speaker 1: for a job. These are the groups of people that

414
00:22:39,600 --> 00:22:42,760
Speaker 1: we need to bring back in the labor force. What

415
00:22:43,040 --> 00:22:45,639
Speaker 1: happens to the labor market in our view is that

416
00:22:46,080 --> 00:22:51,119
Speaker 1: employment will actually continue rising and will probably go to

417
00:22:51,200 --> 00:22:55,800
Speaker 1: pre pandemic levels of employment in two But at the

418
00:22:55,920 --> 00:22:59,000
Speaker 1: same time, we think that some of the We're actually

419
00:22:59,000 --> 00:23:02,760
Speaker 1: optimistic that's some of the long term unemployed workers will

420
00:23:02,840 --> 00:23:06,040
Speaker 1: come back and find jobs, but also some of the

421
00:23:06,080 --> 00:23:08,639
Speaker 1: people that are discouraged now will come back in the

422
00:23:08,720 --> 00:23:12,040
Speaker 1: labor force. So we have a cyclical rebound in the

423
00:23:12,119 --> 00:23:16,359
Speaker 1: labor force participation rate happening next year. So this is

424
00:23:16,400 --> 00:23:20,840
Speaker 1: going to make subsequent unemployment rate numbers look a little

425
00:23:20,880 --> 00:23:25,200
Speaker 1: bit flaggish because the unemployment rate will start declining more slowly.

426
00:23:25,600 --> 00:23:27,439
Speaker 1: But in our views, this is going to be a

427
00:23:27,440 --> 00:23:30,040
Speaker 1: good thing, and it could actually lead to inflation because

428
00:23:30,080 --> 00:23:33,040
Speaker 1: I'm that slack could be beaten out of the market.

429
00:23:33,119 --> 00:23:35,760
Speaker 1: I do want to have a Bloomberg surveillance correction. I

430
00:23:35,760 --> 00:23:38,879
Speaker 1: said fourteen dollars UH for for many months. It's a

431
00:23:38,880 --> 00:23:41,400
Speaker 1: one time payment for now, but it goes exactly where

432
00:23:41,400 --> 00:23:43,400
Speaker 1: I want to go. B Arena this idea that there's

433
00:23:43,480 --> 00:23:49,400
Speaker 1: growing discussions among Democrats in particular about income assistance basically

434
00:23:49,920 --> 00:23:52,840
Speaker 1: check sent to people who are permanent unemployed for a

435
00:23:52,920 --> 00:23:56,560
Speaker 1: prolonged period of time. Do you see an argument for

436
00:23:56,640 --> 00:24:00,640
Speaker 1: that in the successes that evidently helicopter money have had

437
00:24:00,800 --> 00:24:05,600
Speaker 1: in spirring growth throughout the pandemic. So the way I

438
00:24:05,600 --> 00:24:12,520
Speaker 1: I think about it is is this unemployment Insurance UM protection,

439
00:24:12,880 --> 00:24:16,679
Speaker 1: these extra payments. They're lasting until September and the and

440
00:24:16,800 --> 00:24:19,720
Speaker 1: the checks are one of checks. So I think they're

441
00:24:19,760 --> 00:24:23,200
Speaker 1: filling a gap that we have in the economy right

442
00:24:23,200 --> 00:24:26,000
Speaker 1: now because of the high unemployment rate and the damage

443
00:24:26,040 --> 00:24:30,800
Speaker 1: done by this recession. Uh, once they come off UM

444
00:24:31,040 --> 00:24:33,840
Speaker 1: and and consumers don't get these payments anymore, I don't

445
00:24:33,840 --> 00:24:37,359
Speaker 1: think they will pose a risk to the recovery and

446
00:24:37,440 --> 00:24:42,080
Speaker 1: a risk to inflation in the quarters after September. So

447
00:24:42,200 --> 00:24:45,919
Speaker 1: I'm not too worried about these narrative that we're giving

448
00:24:45,960 --> 00:24:48,080
Speaker 1: people too much money and that's going to lead to

449
00:24:48,760 --> 00:24:52,560
Speaker 1: higher inflation on a sustained basis. This is the key

450
00:24:52,600 --> 00:24:56,040
Speaker 1: to me. What is going to keep inflation higher over

451
00:24:56,119 --> 00:24:58,840
Speaker 1: the medium term, and I think for that to happen,

452
00:24:58,920 --> 00:25:02,679
Speaker 1: we actually need some of the structural issues that have

453
00:25:02,800 --> 00:25:07,040
Speaker 1: been keeping inflation lower until now to change, and that

454
00:25:07,320 --> 00:25:12,280
Speaker 1: is at the anchoring of inflation expectations, a lots inside credibility,

455
00:25:12,560 --> 00:25:16,320
Speaker 1: and a change in the way labor bargaining works so

456
00:25:16,359 --> 00:25:20,720
Speaker 1: we get faster way to growth. Blrina. What's the Barkley's

457
00:25:21,040 --> 00:25:25,040
Speaker 1: US GDP forecast for this year and next, So we

458
00:25:25,160 --> 00:25:29,160
Speaker 1: expect quite a robust and snappy recovery this year. Annual

459
00:25:29,200 --> 00:25:32,960
Speaker 1: growth in one is about six and a half based

460
00:25:33,119 --> 00:25:37,080
Speaker 1: on Barkley's forecasting, and next year we're looking at about

461
00:25:37,119 --> 00:25:42,080
Speaker 1: four percent annual growth. Larina Roucie, thank you so much

462
00:25:42,080 --> 00:25:45,639
Speaker 1: for being with us. Blori Rugie, Barkley's senior US economist,

463
00:25:45,840 --> 00:25:50,080
Speaker 1: talking about the key aspects of inflation and employment. This

464
00:25:50,160 --> 00:25:53,919
Speaker 1: is the Bloomberg Surveillance Podcast. Thanks for listening. Join us

465
00:25:54,000 --> 00:25:57,760
Speaker 1: live weekdays from seven to ten am Eastern on Bloomberg

466
00:25:57,840 --> 00:26:01,679
Speaker 1: Radio and on Bloomberg Television each day from six to

467
00:26:01,800 --> 00:26:06,440
Speaker 1: nine a m. For insight from the best in economics, finance, investment,

468
00:26:06,600 --> 00:26:11,600
Speaker 1: and international relations. And subscribe to the Surveillance Podcast on

469
00:26:11,720 --> 00:26:15,520
Speaker 1: Apple podcast, SoundCloud, Bloomberg dot com, and of course, on

470
00:26:15,640 --> 00:26:19,720
Speaker 1: the terminal. I'm Tom keene In. This is Bloomberg.