1 00:00:02,529 --> 00:00:04,210 Speaker 1: Bloomberg Audio Studios. 2 00:00:04,670 --> 00:00:05,370 Speaker 2: Podcasts. 3 00:00:05,690 --> 00:00:06,210 Speaker 3: Radio. 4 00:00:06,660 --> 00:00:07,040 Speaker 2: News. 5 00:00:12,520 --> 00:00:16,660 Speaker 1: This is the Bloomberg Surveillance Podcast. Catch us live weekdays 6 00:00:16,720 --> 00:00:20,210 Speaker 1: at 7 a.m. Eastern on Apple CarPlay or Android Auto 7 00:00:20,290 --> 00:00:23,890 Speaker 1: with the Bloomberg Business app. Listen on demand wherever you 8 00:00:23,910 --> 00:00:26,990 Speaker 1: get your podcasts or watch us live on YouTube. 9 00:00:27,510 --> 00:00:29,200 Speaker 4: Because we're going to flip it on its head right now. 10 00:00:29,520 --> 00:00:32,440 Speaker 4: We're supposed to talk to Belsky, who's nailed this bull 11 00:00:32,479 --> 00:00:37,260 Speaker 4: market with short, terse research notes. And then after that, 12 00:00:37,340 --> 00:00:41,199 Speaker 4: we talk, you know, Vikings football. Let's flip it for 13 00:00:41,220 --> 00:00:45,229 Speaker 4: the 4-0 Vikings. But, Grant, would he recognize his team 14 00:00:45,520 --> 00:00:49,430 Speaker 4: with 12.8 points defense per game first. 15 00:00:49,170 --> 00:00:49,930 Speaker 5: In the NFL? 16 00:00:50,370 --> 00:00:54,550 Speaker 6: He would, because if you think about the Purple People leaders, 17 00:00:54,670 --> 00:00:59,930 Speaker 6: Gary Larson, Alan Page— The guys that ran up front. 18 00:00:59,990 --> 00:01:00,770 Speaker 7: And think about this. 19 00:01:00,800 --> 00:01:05,319 Speaker 6: You had Chuck Foreman in the back field. Fran Tarkin 20 00:01:05,340 --> 00:01:08,319 Speaker 6: didn't with the short passes. But the defense is amazing. 21 00:01:08,360 --> 00:01:10,060 Speaker 6: I mean, we're not going to win a lot more 22 00:01:10,100 --> 00:01:13,350 Speaker 6: games scoring six touchdowns all year long and no offense. 23 00:01:13,990 --> 00:01:16,410 Speaker 4: I mean, if you look at the, for me as 24 00:01:16,450 --> 00:01:20,970 Speaker 4: a non-NFL type, my favorite division is a division, it's 25 00:01:21,030 --> 00:01:23,130 Speaker 4: a Dick Butkus division. 26 00:01:23,209 --> 00:01:23,929 Speaker 5: It's like really ugly. 27 00:01:23,950 --> 00:01:25,430 Speaker 7: The black and blue, the old black and blue. 28 00:01:25,450 --> 00:01:28,220 Speaker 4: Can the Vikings in the modern game compete, say, with 29 00:01:28,300 --> 00:01:30,080 Speaker 4: Seattle in a 52 to 42 football game? 30 00:01:32,930 --> 00:01:36,030 Speaker 6: If they get the offense going, remember Kevin O'Connell loves 31 00:01:36,110 --> 00:01:38,569 Speaker 6: to be able to push the ball downfield. The problem 32 00:01:38,610 --> 00:01:40,170 Speaker 6: is they just can't get the ball out of the 33 00:01:40,209 --> 00:01:43,470 Speaker 6: quarterback's hand. So they can if they get their offense going. 34 00:01:43,490 --> 00:01:44,209 Speaker 6: They need some time. 35 00:01:44,330 --> 00:01:46,970 Speaker 5: One more question. New Orleans this weekend, I'll be watching. 36 00:01:47,560 --> 00:01:50,160 Speaker 4: Brian Belsky, you gave a quarterback to the New York 37 00:01:50,180 --> 00:01:54,320 Speaker 4: football Giants, all of Bloomberg 11-3-0. What's your brief on 38 00:01:54,360 --> 00:01:58,280 Speaker 4: this new quarterback for the Giants who you discarded off 39 00:01:58,360 --> 00:01:59,040 Speaker 4: the treasury? 40 00:01:59,060 --> 00:01:59,120 Speaker 2: J.J. 41 00:01:59,120 --> 00:02:01,290 Speaker 6: McCarthy? So I'm going to take two steps back and 42 00:02:01,330 --> 00:02:04,070 Speaker 6: remind everybody that I was born and raised in Minnesota. 43 00:02:04,780 --> 00:02:08,820 Speaker 6: We have PTSD with respect to every single sport. This 44 00:02:08,900 --> 00:02:11,680 Speaker 6: is classic Minnesota sports. We're going to trade this guy. 45 00:02:11,740 --> 00:02:13,320 Speaker 6: He's going to figure it out. He's going to have 46 00:02:13,340 --> 00:02:15,840 Speaker 6: the gold jacket. He's going to be in the Hall 47 00:02:15,919 --> 00:02:16,240 Speaker 6: of Fame. 48 00:02:16,280 --> 00:02:18,000 Speaker 7: As a Giants fan, I hope he figures it out. 49 00:02:18,060 --> 00:02:18,880 Speaker 3: There's the Belsky. 50 00:02:18,930 --> 00:02:21,970 Speaker 4: We're like, okay, let's take you over here to take. 51 00:02:21,850 --> 00:02:25,630 Speaker 5: You and listen to your new wonderful firm here. You 52 00:02:25,810 --> 00:02:29,070 Speaker 5: nailed this bull market. Did you do it because you 53 00:02:29,090 --> 00:02:30,030 Speaker 5: were PTSD? 54 00:02:30,130 --> 00:02:33,030 Speaker 4: No. No. No. 55 00:02:33,130 --> 00:02:36,649 Speaker 6: So we get accused a lot, Tom, of being Pollyanna 56 00:02:36,669 --> 00:02:37,929 Speaker 6: and not looking at the facts. 57 00:02:37,990 --> 00:02:39,970 Speaker 7: They don't read your research. They don't do the research. 58 00:02:40,060 --> 00:02:42,940 Speaker 7: I mean, we turn bullish on this market. 59 00:02:43,660 --> 00:02:46,320 Speaker 6: What I would call the current market setup in November 60 00:02:46,500 --> 00:02:48,620 Speaker 6: of 2008 when I was at Merrill Lynch, I wrote 61 00:02:48,639 --> 00:02:51,800 Speaker 6: my very first bullish report then in 2009 at Oppenheimer 62 00:02:51,840 --> 00:02:55,680 Speaker 6: and Ten. 2010, we segued the call to say 25-year 63 00:02:55,700 --> 00:02:56,560 Speaker 6: secular bull market. 64 00:02:57,100 --> 00:02:59,200 Speaker 7: Nobody believed us. They still don't believe us. 65 00:02:59,580 --> 00:03:02,480 Speaker 6: And within this big secular bull, you can have cyclical bulls, 66 00:03:02,580 --> 00:03:05,360 Speaker 6: cyclical bears. We'll have another cyclical bear at some point, 67 00:03:05,680 --> 00:03:07,639 Speaker 6: but we have at least eight to 10 years left 68 00:03:07,680 --> 00:03:09,680 Speaker 6: of this run. It's going to be longer than 25 years. 69 00:03:09,780 --> 00:03:12,519 Speaker 8: So what's going to be the driving force with this run? 70 00:03:12,820 --> 00:03:14,600 Speaker 8: Let me guess. Is it AI? Can we have another 71 00:03:14,620 --> 00:03:14,940 Speaker 8: new idea? 72 00:03:15,020 --> 00:03:16,620 Speaker 7: I'm going to say something controversial. 73 00:03:17,200 --> 00:03:19,210 Speaker 6: I don't think the top of this bull market in 74 00:03:19,250 --> 00:03:21,120 Speaker 6: the 2030s is going to have anything to do with AI. 75 00:03:21,820 --> 00:03:24,820 Speaker 6: It's going to have something to do with probably a 76 00:03:24,900 --> 00:03:27,740 Speaker 6: new emerging market and a commodity super cycle that nobody's 77 00:03:27,780 --> 00:03:31,900 Speaker 6: talking about. And so typically and historically, you need to 78 00:03:32,710 --> 00:03:36,589 Speaker 6: have so much money into the markets and so much 79 00:03:36,670 --> 00:03:39,330 Speaker 6: deal flow and all this other assets chasing it. We're 80 00:03:39,350 --> 00:03:42,490 Speaker 6: not doing that in AI, Alexis. Everyone's scared of AI. 81 00:03:42,510 --> 00:03:44,630 Speaker 6: The thing is going to kill us. or there's not 82 00:03:44,650 --> 00:03:46,950 Speaker 6: a lot of IPOs, there's not a lot of secondaries, 83 00:03:46,970 --> 00:03:49,350 Speaker 6: there's not a lot of equity issuances. You need to 84 00:03:49,450 --> 00:03:53,060 Speaker 6: see that to have a mass affluence with respect to 85 00:03:53,080 --> 00:03:54,100 Speaker 6: chasing these AI stocks. 86 00:03:54,420 --> 00:03:55,520 Speaker 7: It's not going to be AI. 87 00:03:55,600 --> 00:03:58,680 Speaker 6: So in the current cycle, meaning the current cyclical bull, 88 00:03:58,800 --> 00:04:01,320 Speaker 6: AI is clearly driving it. But the end of this 89 00:04:01,400 --> 00:04:04,180 Speaker 6: big cycle in 10 years or so is not going 90 00:04:04,200 --> 00:04:04,680 Speaker 6: to be AI. 91 00:04:05,560 --> 00:04:08,090 Speaker 8: Can you tell us what it might be? You said 92 00:04:08,110 --> 00:04:09,030 Speaker 8: a commodity super cycle? 93 00:04:09,070 --> 00:04:11,970 Speaker 6: Commodity super cycle driven by a new emerging market that 94 00:04:12,070 --> 00:04:13,150 Speaker 6: no one knows what it's going to be. 95 00:04:13,290 --> 00:04:16,230 Speaker 7: Could be Minot, North Dakota. Could be Wilmer, Minnesota, where 96 00:04:16,290 --> 00:04:16,610 Speaker 7: I grew up. 97 00:04:16,630 --> 00:04:17,810 Speaker 6: I don't know where it's going to be, but it's 98 00:04:17,830 --> 00:04:20,070 Speaker 6: going to be some emerging market that no one has 99 00:04:20,130 --> 00:04:23,120 Speaker 6: identified yet. It always happens this way. I've seen the 100 00:04:23,160 --> 00:04:26,680 Speaker 6: movie before, and no one's talking about that. If everyone's 101 00:04:26,760 --> 00:04:28,120 Speaker 6: looking at the color blue. 102 00:04:28,820 --> 00:04:32,760 Speaker 7: Right. And everyone's convinced it's blue. It's not blue. You 103 00:04:32,779 --> 00:04:33,500 Speaker 7: know what I'm saying? 104 00:04:33,620 --> 00:04:37,860 Speaker 4: Brian Belsky with us here this morning on the Minnesota Vikings, 105 00:04:37,900 --> 00:04:42,190 Speaker 4: his Minnesota Vikings, and also this crazy bull market. I 106 00:04:42,250 --> 00:04:44,850 Speaker 4: am speaking to the Board of Governors of the CFA 107 00:04:44,930 --> 00:04:48,090 Speaker 4: Institute today, and I will announce my essay of the year. 108 00:04:48,190 --> 00:04:49,190 Speaker 5: I'm not going to do it here. 109 00:04:49,990 --> 00:04:53,589 Speaker 4: But the basic theme of the essay is looking at 110 00:04:53,710 --> 00:04:59,230 Speaker 4: price-based ratios and is dangerous. You have to go deeper 111 00:04:59,410 --> 00:05:03,080 Speaker 4: like Belsky does and look at the fundamentals of the 112 00:05:03,160 --> 00:05:07,140 Speaker 4: three major accounting statements. Do you see excess there? We 113 00:05:07,160 --> 00:05:09,550 Speaker 4: had a guest on moments ago that said with this 114 00:05:09,690 --> 00:05:12,370 Speaker 4: earning growth, the market's not overpriced. 115 00:05:12,529 --> 00:05:13,010 Speaker 5: Do you agree? 116 00:05:13,820 --> 00:05:14,359 Speaker 7: It isn't. 117 00:05:14,540 --> 00:05:16,660 Speaker 6: And we just published a piece last week talking about 118 00:05:16,700 --> 00:05:18,799 Speaker 6: how higher interest rates actually can. 119 00:05:18,720 --> 00:05:19,820 Speaker 7: Bode very well for stocks. 120 00:05:19,900 --> 00:05:20,109 Speaker 3: Why? 121 00:05:20,140 --> 00:05:20,870 Speaker 7: Because it's about. 122 00:05:21,390 --> 00:05:24,250 Speaker 6: Higher interest rates is about in a reaction to the 123 00:05:24,290 --> 00:05:27,300 Speaker 6: strong earnings growth. And no other time in my 36 124 00:05:27,300 --> 00:05:28,880 Speaker 6: and a half year career have I ever seen. 125 00:05:29,460 --> 00:05:29,700 Speaker 7: the. 126 00:05:29,620 --> 00:05:33,120 Speaker 6: Amount of upward earnings revisions on an annual basis for 127 00:05:33,140 --> 00:05:35,340 Speaker 6: the second quarter, and now we've been matching it for 128 00:05:35,360 --> 00:05:35,920 Speaker 6: the third quarter. 129 00:05:35,940 --> 00:05:38,080 Speaker 7: What does that mean? When analysts come in and revise 130 00:05:38,110 --> 00:05:40,430 Speaker 7: their numbers higher, I've never seen that type of number. 131 00:05:40,690 --> 00:05:43,410 Speaker 6: That's number one. Number two, what does the Fed raise 132 00:05:43,470 --> 00:05:46,610 Speaker 6: rates for? Fed raises rates because they're worried about inflation. 133 00:05:46,910 --> 00:05:51,680 Speaker 6: Let's talk about the 1970s or maybe 2022. But growth 134 00:05:51,740 --> 00:05:54,310 Speaker 6: is strong, and I think that's why rates are going up. 135 00:05:54,720 --> 00:05:57,640 Speaker 6: Number three, this is an economy that nobody saw coming. 136 00:05:58,100 --> 00:06:00,780 Speaker 6: And we still think that there's a tremendous amount of 137 00:06:00,820 --> 00:06:03,960 Speaker 6: skepticism with respect to that. So we do think that 138 00:06:04,020 --> 00:06:06,880 Speaker 6: this market can go higher, driven by fundamentals. Lastly, I'll 139 00:06:06,930 --> 00:06:10,030 Speaker 6: say this on the PEs and stuff like that. What 140 00:06:10,070 --> 00:06:13,290 Speaker 6: people are missing is companies have massive amounts of cash flow, 141 00:06:13,310 --> 00:06:14,970 Speaker 6: debt to equity is down. If debt to equity is 142 00:06:14,990 --> 00:06:17,970 Speaker 6: down across the board, they can continue to grow their 143 00:06:18,010 --> 00:06:20,190 Speaker 6: company through the means that they need to, and the 144 00:06:20,270 --> 00:06:21,490 Speaker 6: earnings can continue to go up. 145 00:06:21,490 --> 00:06:23,270 Speaker 8: Maybe because they're sitting on so much cash still? 146 00:06:23,290 --> 00:06:23,510 Speaker 9: Yeah. 147 00:06:23,670 --> 00:06:23,970 Speaker 7: Yes. 148 00:06:24,070 --> 00:06:27,040 Speaker 6: And think about like, what about NVIDIA? People don't talk 149 00:06:27,070 --> 00:06:29,160 Speaker 6: about NVIDIA buying back all this stock. Think about all 150 00:06:29,200 --> 00:06:31,660 Speaker 6: the stock that's being bought back. No one talks about that. 151 00:06:31,700 --> 00:06:33,880 Speaker 6: We all just talk about data centers and worried about 152 00:06:33,920 --> 00:06:37,060 Speaker 6: that and how we're going to get through the midterm election. 153 00:06:37,740 --> 00:06:40,350 Speaker 8: NVIDIA now is about to be the first $ 6 trillion 154 00:06:40,400 --> 00:06:43,530 Speaker 8: company in the world. Is there more room to run 155 00:06:43,570 --> 00:06:44,370 Speaker 8: for a stock like that? 156 00:06:45,190 --> 00:06:47,430 Speaker 6: Sure there is, because I think there's a lot more 157 00:06:47,470 --> 00:06:49,570 Speaker 6: room for the market to run. I mean, again, people 158 00:06:49,650 --> 00:06:51,350 Speaker 6: are still, I believe that there's still a lot of 159 00:06:51,370 --> 00:06:55,840 Speaker 6: cash on a on an institutional basis. Private wealth has 160 00:06:55,860 --> 00:06:58,339 Speaker 6: done a wonderful job with this market in terms of 161 00:06:58,480 --> 00:07:02,700 Speaker 6: diversifying it out. It has typically and historically been another 162 00:07:02,740 --> 00:07:05,230 Speaker 6: one of those years where the majority of institutions are underperforming. 163 00:07:05,810 --> 00:07:08,990 Speaker 4: My great theme here is we have, after multiple stimuli, 164 00:07:09,010 --> 00:07:13,630 Speaker 4: a nominal GDP of a banana republic. What's the path 165 00:07:13,770 --> 00:07:18,250 Speaker 4: you see of nominal GDP, the animal spirit, the boom 166 00:07:18,290 --> 00:07:24,280 Speaker 4: economy we have, coming down that is constructive For long-term investors. 167 00:07:24,300 --> 00:07:26,720 Speaker 6: Well, I think if we don't have some sort of 168 00:07:26,800 --> 00:07:29,490 Speaker 6: a mass correction in GDP, if we don't cut it 169 00:07:29,550 --> 00:07:31,490 Speaker 6: in half, if we cut it into a third and 170 00:07:31,510 --> 00:07:33,230 Speaker 6: we have this kind of path the way that the 171 00:07:33,290 --> 00:07:36,190 Speaker 6: markets and earnings are going, what you're going to be 172 00:07:36,250 --> 00:07:40,450 Speaker 6: seeing and hearing about, ladies and gentlemen, is that you're 173 00:07:40,480 --> 00:07:42,820 Speaker 6: going to hear now from all the negative Nellies and 174 00:07:42,860 --> 00:07:45,080 Speaker 6: all the economists and all the quants and all the bears, 175 00:07:45,500 --> 00:07:47,660 Speaker 6: that here comes the rate of change in terms of GDP, 176 00:07:47,700 --> 00:07:49,440 Speaker 6: and here comes the rate of change in earnings growth. 177 00:07:49,840 --> 00:07:53,270 Speaker 6: Positive growth in GDP and positive earnings growth is still 178 00:07:53,350 --> 00:07:56,570 Speaker 6: positive growth, period. It's when we start to see a 179 00:07:56,850 --> 00:08:00,750 Speaker 6: massive deceleration with respect to overall orders, and we start 180 00:08:00,770 --> 00:08:02,930 Speaker 6: to see from an operating performance, which is part of 181 00:08:02,950 --> 00:08:06,020 Speaker 6: the financial statement, return on equity, return on invested capital 182 00:08:06,080 --> 00:08:07,180 Speaker 6: beginning to turn negative. 183 00:08:07,680 --> 00:08:08,320 Speaker 7: Is this still a. 184 00:08:08,340 --> 00:08:10,680 Speaker 8: Pick and choose market, though? Do you have to carefully 185 00:08:11,060 --> 00:08:14,460 Speaker 8: decide and intentionally decide where you're putting the money? 186 00:08:14,760 --> 00:08:15,370 Speaker 7: Very much so. 187 00:08:15,430 --> 00:08:17,170 Speaker 6: So we have the very good fortune of running nine 188 00:08:17,190 --> 00:08:20,930 Speaker 6: different portfolios, five in the U.S. And our U.S.-focused portfolio, 189 00:08:20,990 --> 00:08:22,450 Speaker 6: which is benchmarked to the S & P 500, is. 190 00:08:22,370 --> 00:08:24,590 Speaker 7: Outperforming the market. We don't own Meta and we don't 191 00:08:24,630 --> 00:08:25,210 Speaker 7: own Micron. 192 00:08:25,670 --> 00:08:27,790 Speaker 6: And the reason is that we pick stocks and we're 193 00:08:27,830 --> 00:08:30,130 Speaker 6: more concentrated in certain areas. And that's how you're going 194 00:08:30,170 --> 00:08:33,870 Speaker 6: to not only deliver alpha, but deliver differentiation relative to 195 00:08:33,890 --> 00:08:34,550 Speaker 6: our competitors. 196 00:08:35,650 --> 00:08:40,200 Speaker 4: One final question. There's an AI frenzy out there. Is 197 00:08:40,240 --> 00:08:43,790 Speaker 4: it a constructive investment or Do you see a workout, say, 198 00:08:43,830 --> 00:08:47,050 Speaker 4: with token prices coming down? When you see the hopes 199 00:08:47,130 --> 00:08:50,580 Speaker 4: and prayers, the glide paths of those hopes and prayers, 200 00:08:50,940 --> 00:08:52,720 Speaker 4: does it get to a successful outcome? 201 00:08:53,040 --> 00:08:55,060 Speaker 6: I think it does if you have some common sense 202 00:08:55,100 --> 00:08:57,339 Speaker 6: that you're not all your eggs in one basket. Think 203 00:08:57,380 --> 00:09:00,660 Speaker 6: about AI, how it works within the construct of the 204 00:09:00,720 --> 00:09:03,780 Speaker 6: entire market, the entire economy, not just tech stocks, not 205 00:09:03,800 --> 00:09:06,610 Speaker 6: just software, not just hardware, what it means to healthcare, 206 00:09:06,630 --> 00:09:09,150 Speaker 6: what it means to financials, and then have representation with 207 00:09:09,190 --> 00:09:10,850 Speaker 6: respect to your portfolio accordingly. 208 00:09:11,900 --> 00:09:14,100 Speaker 5: This has been wonderful. Thank you for the Vikings brief. 209 00:09:14,480 --> 00:09:15,720 Speaker 5: I mean, seriously, New Orleans. 210 00:09:15,760 --> 00:09:18,280 Speaker 7: I would take New Orleans. I mean, you know, listen 211 00:09:18,320 --> 00:09:18,800 Speaker 7: to you. 212 00:09:19,160 --> 00:09:19,559 Speaker 5: I would. 213 00:09:19,600 --> 00:09:21,020 Speaker 7: I mean, I just, come on. They're going to break 214 00:09:21,059 --> 00:09:21,280 Speaker 7: my heart. 215 00:09:21,300 --> 00:09:24,990 Speaker 6: Just like my twins, Tom, 26 consecutive years of season tickets. 216 00:09:25,030 --> 00:09:26,250 Speaker 7: They don't do anything for me. 217 00:09:26,250 --> 00:09:28,870 Speaker 4: It's called doing a Toronto Maple Leafs. Brian Belsky, thank 218 00:09:28,890 --> 00:09:30,270 Speaker 4: you so much. Greatly appreciate it. 219 00:09:32,070 --> 00:09:32,690 Speaker 5: Stay with us. 220 00:09:32,970 --> 00:09:36,220 Speaker 10: More from Bloomberg Surveillance coming up after this. 221 00:09:43,480 --> 00:09:47,080 Speaker 1: You're listening to the Bloomberg Surveillance Podcast. Catch us live 222 00:09:47,160 --> 00:09:49,220 Speaker 1: weekday afternoons from 7 to 10 a.m. 223 00:09:49,280 --> 00:09:49,679 Speaker 6: Eastern. 224 00:09:49,780 --> 00:09:53,069 Speaker 1: Listen on Apple CarPlay and Android Auto with the Bloomberg 225 00:09:53,110 --> 00:09:55,610 Speaker 1: Business app. Or watch us live on YouTube. 226 00:09:55,929 --> 00:09:57,209 Speaker 5: I've really been looking forward to this. 227 00:09:57,210 --> 00:09:59,850 Speaker 4: I was on tarman joins us now vice chair global 228 00:09:59,890 --> 00:10:02,170 Speaker 4: macro at deutsche bank and all i got to do 229 00:10:02,270 --> 00:10:04,180 Speaker 4: and i'm sorry i was an unlike you i can't 230 00:10:04,200 --> 00:10:06,300 Speaker 4: look at le monde in french i have to look 231 00:10:06,320 --> 00:10:09,480 Speaker 4: at le monde in english what students are saying during 232 00:10:09,559 --> 00:10:13,819 Speaker 4: high school blockades i'm worried about my future and for 233 00:10:13,980 --> 00:10:17,700 Speaker 4: all students in france right now And we had Lionel 234 00:10:17,740 --> 00:10:21,140 Speaker 4: Laurent from Paris yesterday who was brilliant. Do you see 235 00:10:21,160 --> 00:10:25,540 Speaker 4: a contagion to Deutsche Bank in Europe from the troubles 236 00:10:25,600 --> 00:10:26,020 Speaker 4: of France? 237 00:10:26,660 --> 00:10:29,730 Speaker 2: Tom, always a pleasure to see you. This French storm 238 00:10:29,760 --> 00:10:33,209 Speaker 2: was brewing for a while. It got a lot messy 239 00:10:33,290 --> 00:10:37,210 Speaker 2: last week because finally it started spreading into European credit. 240 00:10:38,240 --> 00:10:42,140 Speaker 2: To Germany and beyond, no, I do not see yet. 241 00:10:43,020 --> 00:10:47,680 Speaker 2: Even in my smaller, big macro dinners in U.S., people 242 00:10:47,700 --> 00:10:51,459 Speaker 2: seem to be more focused on OATs than U.S. 243 00:10:51,480 --> 00:10:51,960 Speaker 7: Treasuries. 244 00:10:52,100 --> 00:10:54,760 Speaker 2: But despite that, at the end, everybody, maybe in a 245 00:10:54,820 --> 00:10:58,520 Speaker 2: cute way, expecting that TPI, that intervention to come if 246 00:10:58,540 --> 00:10:59,140 Speaker 2: things get worse. 247 00:10:59,220 --> 00:11:02,490 Speaker 4: How do they clear the problem? Don't tell me it's 248 00:11:02,500 --> 00:11:05,960 Speaker 4: the election a million months out. They have to clear 249 00:11:06,020 --> 00:11:09,630 Speaker 4: this some way. And Lionel Laurent yesterday said he's unsure 250 00:11:10,190 --> 00:11:11,450 Speaker 4: how that process happens. 251 00:11:11,490 --> 00:11:12,610 Speaker 5: What does Deutsche Bank say? 252 00:11:13,230 --> 00:11:16,510 Speaker 2: I'm with you. It's not that easy to clear the process. Now, 253 00:11:16,570 --> 00:11:20,080 Speaker 2: Le Pen is acting like the responsible one. The Iran 254 00:11:20,120 --> 00:11:23,880 Speaker 2: budget today seemed more liberal. 255 00:11:24,240 --> 00:11:26,020 Speaker 7: But I don't think it's going away. 256 00:11:26,800 --> 00:11:30,380 Speaker 2: She's going to try to soothe the markets, dance with 257 00:11:30,400 --> 00:11:34,150 Speaker 2: the 1%, if you will. But if she does enact 258 00:11:34,190 --> 00:11:38,130 Speaker 2: that budget, protests will continue. So the ache will be 259 00:11:38,150 --> 00:11:41,670 Speaker 2: with us. But at the same time, ECB won't let 260 00:11:42,440 --> 00:11:43,439 Speaker 2: it become too systemic. 261 00:11:44,240 --> 00:11:45,360 Speaker 5: This is worldwide. 262 00:11:45,600 --> 00:11:50,060 Speaker 4: Last night in Quebec, they had their elections and it 263 00:11:50,100 --> 00:11:53,810 Speaker 4: was a truly stunning result. It's not like early Trudeau. 264 00:11:54,429 --> 00:11:58,670 Speaker 4: first Trudeau, Justin Trudeau, Katy Perry's father-in-law. Okay, I got 265 00:11:58,720 --> 00:11:59,120 Speaker 4: that right. 266 00:11:59,160 --> 00:12:03,100 Speaker 5: But it's not like early Trudeau where there's a true separatist. 267 00:12:03,100 --> 00:12:08,220 Speaker 4: Idea, but it was a shock election of populism, Alexis, 268 00:12:08,260 --> 00:12:10,020 Speaker 4: last night in Montreal and Quebec. 269 00:12:10,559 --> 00:12:13,770 Speaker 8: Yeah, interesting vote. And they're saying that, you know, nothing 270 00:12:13,790 --> 00:12:15,810 Speaker 8: would happen while Trump is in office, I think, for 271 00:12:15,870 --> 00:12:17,550 Speaker 8: obvious reasons with the tariffs and what have you. But 272 00:12:17,830 --> 00:12:19,210 Speaker 8: I want to get back to France for a moment 273 00:12:19,330 --> 00:12:21,929 Speaker 8: and French debt. Does it still look more like a 274 00:12:21,990 --> 00:12:28,210 Speaker 8: repricing of country-specific fiscal risk than contagion? I guess what 275 00:12:28,230 --> 00:12:30,270 Speaker 8: I'm asking is, is this more a France problem than 276 00:12:30,309 --> 00:12:31,000 Speaker 8: anything else? 277 00:12:31,100 --> 00:12:34,700 Speaker 2: I don't think it's over yet. I think, if anything, again, 278 00:12:34,760 --> 00:12:39,059 Speaker 2: last night, quite big players in discussing trying to save 279 00:12:39,100 --> 00:12:42,300 Speaker 2: the world. People almost looked at France as, when will 280 00:12:42,320 --> 00:12:45,210 Speaker 2: the opportunity come? When can we time ECB, etc. 281 00:12:45,260 --> 00:12:45,330 Speaker 4: etc. 282 00:12:46,450 --> 00:12:48,550 Speaker 2: I think that's a bit cute way of looking at it. 283 00:12:49,090 --> 00:12:51,570 Speaker 2: We may have more days like last Thursday, Friday. What 284 00:12:51,590 --> 00:12:54,230 Speaker 2: do I mean by that? It may spread into European credit. 285 00:12:54,390 --> 00:12:57,950 Speaker 2: It may spread into European banks. Because people do hear Tom. 286 00:12:58,110 --> 00:12:59,970 Speaker 2: I mean, you cannot just get rid of this by 287 00:13:00,470 --> 00:13:02,890 Speaker 2: putting a plaster on top of it. Spanish early elections 288 00:13:02,950 --> 00:13:06,290 Speaker 2: on November 29. Somebody has to pay for all this. 289 00:13:06,550 --> 00:13:10,079 Speaker 2: Somebody has to be accountable. And people also are revolting 290 00:13:10,200 --> 00:13:12,060 Speaker 2: for a right reason. Because throughout the world, we're talking 291 00:13:12,080 --> 00:13:15,600 Speaker 2: about being global. Middle income, the poor is just being... 292 00:13:16,660 --> 00:13:18,400 Speaker 2: Erase them. I got to make. 293 00:13:18,300 --> 00:13:20,160 Speaker 4: Some news this morning. We can do this with Deutsche 294 00:13:20,200 --> 00:13:23,700 Speaker 4: Bank Research. George Cervelo, who I know you're not speaking 295 00:13:23,740 --> 00:13:24,260 Speaker 4: terms with. 296 00:13:24,500 --> 00:13:25,460 Speaker 7: I was with him last night. 297 00:13:25,520 --> 00:13:29,040 Speaker 4: Is his solution that weak euro gets it done? That 298 00:13:29,140 --> 00:13:32,660 Speaker 4: currency is the leakage, the valve, if you will, from 299 00:13:32,730 --> 00:13:37,250 Speaker 4: all this fiscal irresponsibility and we get 0.99 euro? 300 00:13:37,550 --> 00:13:37,990 Speaker 7: I hear you. 301 00:13:38,570 --> 00:13:40,790 Speaker 2: If anything, my George, and again, he was with me 302 00:13:40,870 --> 00:13:44,270 Speaker 2: on this dinner last night. His official forecast still 117, 303 00:13:44,250 --> 00:13:46,850 Speaker 2: but I think that's under strain a little bit. On 304 00:13:46,870 --> 00:13:49,110 Speaker 2: days like this when euro tries to squeeze, I think 305 00:13:49,130 --> 00:13:52,579 Speaker 2: people will use that as a selling euro opportunity. Most 306 00:13:52,600 --> 00:13:56,240 Speaker 2: people do see it going to 109 before 115. And 307 00:13:56,679 --> 00:14:00,720 Speaker 2: even if this TPI happens, right thing for Europe, etc., 308 00:14:01,110 --> 00:14:04,250 Speaker 2: first Europe squeezes if it happens tomorrow. But then I 309 00:14:04,290 --> 00:14:06,410 Speaker 2: think people take that as a selling opportunity. So what 310 00:14:06,429 --> 00:14:08,010 Speaker 2: I'm trying to say is at the moment, the wind 311 00:14:08,070 --> 00:14:08,990 Speaker 2: is with short Euro. 312 00:14:09,230 --> 00:14:10,190 Speaker 5: Now, bring it over to U.S. 313 00:14:10,350 --> 00:14:13,290 Speaker 4: Equities because Alexis is looking at it like talk America. 314 00:14:13,670 --> 00:14:16,840 Speaker 4: You have the advantage of Binkrum Chata, glass half full, 315 00:14:17,200 --> 00:14:20,120 Speaker 4: an optimist at Deutsche Bank. And boy, has he nailed 316 00:14:20,200 --> 00:14:23,020 Speaker 4: it on a call on Standard & Poor's 500. 317 00:14:23,020 --> 00:14:26,360 Speaker 5: Let's start with a why. Why are equities in America. 318 00:14:27,000 --> 00:14:30,480 Speaker 4: So exceptional versus the madness that's out there. 319 00:14:30,620 --> 00:14:33,180 Speaker 2: You got to love Tom, our biggest advertiser. Yes, he's 320 00:14:33,210 --> 00:14:35,730 Speaker 2: been right for three years in a row now, 22 321 00:14:35,730 --> 00:14:40,590 Speaker 2: being an exception. And he's again being even conservative at 8,000. 322 00:14:40,590 --> 00:14:42,290 Speaker 2: Let me break some news to you. I wouldn't be 323 00:14:42,330 --> 00:14:47,220 Speaker 2: surprised if he upgrades that 8,000 year-end forecast soon. Earnings 324 00:14:47,480 --> 00:14:51,010 Speaker 2: earnings earnings again breaking news bottom up I think market 325 00:14:51,050 --> 00:14:53,590 Speaker 2: expects more or less 27 percent in the next earning 326 00:14:53,610 --> 00:14:56,070 Speaker 2: season to come right binky dropped the ball with saying 327 00:14:56,070 --> 00:14:58,930 Speaker 2: 34 percent ice popped up like this But the guy 328 00:14:58,950 --> 00:15:01,770 Speaker 2: has nailed it before if he's anywhere right about those 329 00:15:01,870 --> 00:15:04,510 Speaker 2: earning process beyond take by the way Not just take 330 00:15:04,550 --> 00:15:07,880 Speaker 2: not just seven eight names then yeah, whether you like 331 00:15:07,900 --> 00:15:10,880 Speaker 2: the term or not us exceptionalism continues red at over 332 00:15:10,940 --> 00:15:14,770 Speaker 2: blue hat and U.S. continues to do better than Europe 333 00:15:14,870 --> 00:15:16,930 Speaker 2: at least. Now, emerging markets are a different matter. Let 334 00:15:16,970 --> 00:15:19,650 Speaker 2: me sneak my terroir emerging markets as well. You see 335 00:15:19,690 --> 00:15:24,660 Speaker 2: what Brazil is doing, Tom. Despite two great years, emerging 336 00:15:24,700 --> 00:15:28,980 Speaker 2: markets bus is quite empty. People love the Flavio result 337 00:15:29,160 --> 00:15:32,300 Speaker 2: from Sunday night. So I think that has legs to go, 338 00:15:32,360 --> 00:15:32,860 Speaker 2: Latin America. 339 00:15:33,670 --> 00:15:37,050 Speaker 8: So do you stick with EM? Do you take more 340 00:15:37,110 --> 00:15:38,230 Speaker 8: risk with EM? 341 00:15:38,870 --> 00:15:42,640 Speaker 2: EM generalization is the world is too complex for now. Asia, again, 342 00:15:42,720 --> 00:15:44,880 Speaker 2: even Asia, generalizing Asia is a bit too much. But 343 00:15:44,920 --> 00:15:47,620 Speaker 2: I think the consensus trade that will work, for example, 344 00:15:47,820 --> 00:15:52,110 Speaker 2: long Brazil, short India, software, et cetera, et cetera. Overall, 345 00:15:52,170 --> 00:15:56,109 Speaker 2: long Latam, short Asia, sometimes consensus is right. I think 346 00:15:56,130 --> 00:15:58,370 Speaker 2: the people believe in that trade and it will continue 347 00:15:58,390 --> 00:15:58,670 Speaker 2: to deliver. 348 00:15:59,500 --> 00:16:02,670 Speaker 8: Is the U.S. so exceptional because of AI? Is that 349 00:16:02,710 --> 00:16:05,110 Speaker 8: really what it boils down to? And what do you 350 00:16:05,150 --> 00:16:06,510 Speaker 8: do with the AI trade right now? 351 00:16:08,850 --> 00:16:13,380 Speaker 2: Tom's Boston baseball analogy, I'm not sure we're at eighth 352 00:16:13,560 --> 00:16:16,420 Speaker 2: or ninth inning. I think that bubble first needs to 353 00:16:16,460 --> 00:16:18,860 Speaker 2: get a bit higher. People will still buy their 7% 354 00:16:18,860 --> 00:16:22,970 Speaker 2: Google bond. So I think we have more room to run. 355 00:16:23,170 --> 00:16:25,690 Speaker 2: Is it just AI? I'm not sure, but a big 356 00:16:25,730 --> 00:16:28,130 Speaker 2: part of it is AI. And at the moment, America 357 00:16:28,170 --> 00:16:30,700 Speaker 2: has put all its chips on that. 358 00:16:30,980 --> 00:16:31,360 Speaker 6: Literally. 359 00:16:31,920 --> 00:16:34,900 Speaker 2: And the big, big, big bet, big races with China. 360 00:16:36,340 --> 00:16:41,040 Speaker 2: the verdict is also out on who's winning. But at 361 00:16:41,080 --> 00:16:43,920 Speaker 2: the moment, America is certainly not losing. So that's why, 362 00:16:44,000 --> 00:16:47,220 Speaker 2: gone to my head, I think we see 8,200 before 7,400. 363 00:16:47,200 --> 00:16:48,800 Speaker 2: I want to. 364 00:16:48,780 --> 00:16:51,290 Speaker 4: Talk about, you know, this is your history at Harvard 365 00:16:51,310 --> 00:16:55,830 Speaker 4: of political economy and political history as well. Is a 366 00:16:55,970 --> 00:17:02,150 Speaker 4: general statement, do investors reward a more conservative government? 367 00:17:02,270 --> 00:17:03,900 Speaker 5: In Latin America, we. 368 00:17:03,820 --> 00:17:07,340 Speaker 4: Have a whole string of of more conservative wins, perhaps 369 00:17:07,359 --> 00:17:10,979 Speaker 4: we'll see that, we believe so, in Brazil as well. 370 00:17:11,400 --> 00:17:15,399 Speaker 4: Cook Political Report, Aaron over there, comes out and basically 371 00:17:15,770 --> 00:17:19,470 Speaker 4: replicates beautifully what Terry Haynes has talked about. Yeah, the 372 00:17:19,530 --> 00:17:22,470 Speaker 4: Democrats will win, but it may not be that big 373 00:17:22,490 --> 00:17:25,510 Speaker 4: a win. That's market friendly, right? 374 00:17:26,380 --> 00:17:28,440 Speaker 2: If we get split in the Congress, you mean? 375 00:17:28,460 --> 00:17:31,919 Speaker 4: Gridlock and the idea that maybe the Republicans aren't as 376 00:17:31,980 --> 00:17:34,280 Speaker 4: beleaguered as so many are predicting? 377 00:17:34,320 --> 00:17:36,640 Speaker 2: If we do, my Tom, if we do, yes. But 378 00:17:36,680 --> 00:17:39,700 Speaker 2: at the moment, most think tanks, most polls are, you know, 379 00:17:40,380 --> 00:17:46,060 Speaker 2: leaning towards the president losing both houses. So then even 380 00:17:46,140 --> 00:17:49,679 Speaker 2: Binky hedges a bit because 21 out of 23 out 381 00:17:49,700 --> 00:17:52,800 Speaker 2: of the midterms we rallied. What is one of the one? 382 00:17:53,960 --> 00:17:57,949 Speaker 2: That was an exception. Trump, 1.0, 2018. You remember what 383 00:17:57,990 --> 00:18:02,790 Speaker 2: happened then. He really took on Powell. So, you know, 384 00:18:02,890 --> 00:18:07,619 Speaker 2: checks and balances. How do you check, dear Mr. President Trump? 385 00:18:08,040 --> 00:18:11,160 Speaker 2: If there is a big loss on that midterms, that's 386 00:18:11,320 --> 00:18:15,159 Speaker 2: one risk that even Binky sees. If we get your splits, 387 00:18:15,580 --> 00:18:16,530 Speaker 2: I think market would love it. 388 00:18:17,660 --> 00:18:20,440 Speaker 8: Treasury Secretary Scott Besson out with some comments. And it 389 00:18:20,530 --> 00:18:24,149 Speaker 8: looks like Wall Street is split. in essence, ignoring them. 390 00:18:24,190 --> 00:18:27,320 Speaker 8: But he basically said the government would start bending that curve, 391 00:18:27,359 --> 00:18:29,960 Speaker 8: his words, of U.S. government borrowing with a mix of 392 00:18:30,100 --> 00:18:33,109 Speaker 8: economic growth and spending restraints. Is this really just talk 393 00:18:33,530 --> 00:18:35,959 Speaker 8: from the White House? And is it just... Nothing they 394 00:18:36,000 --> 00:18:37,540 Speaker 8: can do or say at this moment is going to 395 00:18:37,560 --> 00:18:38,200 Speaker 8: move this market. 396 00:18:38,440 --> 00:18:40,760 Speaker 2: No, no, no, not necessarily. I'm coming from EM. I 397 00:18:40,780 --> 00:18:43,740 Speaker 2: do have some belief in financial repression as well. So 398 00:18:43,780 --> 00:18:47,080 Speaker 2: this whole fiscal dominance versus financial repression fight. He may have, 399 00:18:47,140 --> 00:18:49,370 Speaker 2: I mean, let's see how the house analogy goes, but 400 00:18:49,770 --> 00:18:51,570 Speaker 2: he may have a strong hand in Japan. He may 401 00:18:51,609 --> 00:18:53,510 Speaker 2: have a strong hand on the long end of the U.S., 402 00:18:55,109 --> 00:18:57,830 Speaker 2: So I would still watch out the QRA, the issues 403 00:18:57,890 --> 00:19:00,750 Speaker 2: in November. I think he will do a Yellen, even 404 00:19:00,770 --> 00:19:03,570 Speaker 2: though he kept criticizing Yellen and issue less on the 405 00:19:03,590 --> 00:19:06,270 Speaker 2: long end. But he needed a bit more help from 406 00:19:06,310 --> 00:19:08,619 Speaker 2: Walsh and the Hawks. At the end of the day, 407 00:19:08,670 --> 00:19:11,590 Speaker 2: if Walsh and the Hawks continue to lead the rhetoric, 408 00:19:11,770 --> 00:19:13,810 Speaker 2: then it's very hard for him to control the long 409 00:19:13,869 --> 00:19:17,070 Speaker 2: end by just 6 billion buybacks on his own. He needed, 410 00:19:17,609 --> 00:19:19,609 Speaker 2: whether they admit it or not, he needed a bit 411 00:19:19,650 --> 00:19:23,030 Speaker 2: more team play from Fed and the Hawks. They didn't 412 00:19:23,050 --> 00:19:23,629 Speaker 2: necessarily get that. 413 00:19:24,040 --> 00:19:24,900 Speaker 5: Ozan, thank you so much. 414 00:19:24,980 --> 00:19:28,600 Speaker 4: Ozan Tarman, always a pleasure for dipping into the research 415 00:19:28,640 --> 00:19:32,200 Speaker 4: capabilities of his Deutsche Bank, where he is vice chair. 416 00:19:34,160 --> 00:19:34,780 Speaker 5: Stay with us. 417 00:19:35,060 --> 00:19:38,340 Speaker 10: More from Bloomberg Surveillance coming up after this. 418 00:19:45,570 --> 00:19:49,190 Speaker 1: You're listening to the Bloomberg Surveillance podcast. Catch us live 419 00:19:49,270 --> 00:19:51,320 Speaker 1: weekday afternoon. from 7 to 10 a.m. 420 00:19:51,380 --> 00:19:51,780 Speaker 3: Eastern. 421 00:19:51,880 --> 00:19:55,159 Speaker 1: Listen on Apple CarPlay and Android Auto with the Bloomberg 422 00:19:55,200 --> 00:19:57,670 Speaker 1: Business app or watch us live on YouTube. 423 00:19:57,690 --> 00:20:01,710 Speaker 4: We were talking about Tiffany Wilding earlier here in her 424 00:20:01,810 --> 00:20:06,189 Speaker 4: wonderful economics at the Pacific Investment Management Company, PIMCO, which 425 00:20:06,230 --> 00:20:06,669 Speaker 4: we all know. 426 00:20:07,500 --> 00:20:08,080 Speaker 5: In Newport Beach. 427 00:20:08,140 --> 00:20:14,910 Speaker 4: Tiffany, are you using conventional economics to guess forward where 428 00:20:14,950 --> 00:20:20,210 Speaker 4: we're going to be the first quarter, second quarter of 2027? 429 00:20:22,470 --> 00:20:25,050 Speaker 9: Yeah, well, you know, when we look out, we think 430 00:20:25,190 --> 00:20:29,389 Speaker 9: we're pretty constructive on the growth outlook. We just released 431 00:20:29,590 --> 00:20:32,570 Speaker 9: our essay on the outlook this morning. We think growth 432 00:20:32,630 --> 00:20:36,669 Speaker 9: looks pretty resilient, inflation coming down, and ultimately the central 433 00:20:36,710 --> 00:20:40,770 Speaker 9: banks will deliver less than what's priced into markets. But 434 00:20:40,810 --> 00:20:45,190 Speaker 9: the interesting thing about today and the paradox that we 435 00:20:45,300 --> 00:20:48,520 Speaker 9: see is just that the buffers that have contributed to 436 00:20:48,560 --> 00:20:53,460 Speaker 9: this resilience, AI investment boom being the biggest one, they 437 00:20:53,520 --> 00:20:57,160 Speaker 9: also create other risks. And we think as a result 438 00:20:57,220 --> 00:21:01,270 Speaker 9: of that, investors should want to participate in that resilience, 439 00:21:01,609 --> 00:21:04,969 Speaker 9: but they also should hedge some of that risk and 440 00:21:05,010 --> 00:21:06,950 Speaker 9: fragility under the surface. 441 00:21:07,850 --> 00:21:10,889 Speaker 8: You say that we should be selective within credit as 442 00:21:10,970 --> 00:21:14,520 Speaker 8: part of this essay. What do you like in credit 443 00:21:14,600 --> 00:21:14,879 Speaker 8: right now? 444 00:21:17,530 --> 00:21:19,790 Speaker 9: Well, you know, certainly we are seeing one of the 445 00:21:19,810 --> 00:21:23,770 Speaker 9: biggest investment booms since the 90s associated with the AI 446 00:21:24,170 --> 00:21:27,090 Speaker 9: infrastructure build out. You know, and so as a result, 447 00:21:27,130 --> 00:21:32,460 Speaker 9: we certainly participating in some of the investment opportunities associated 448 00:21:32,500 --> 00:21:35,100 Speaker 9: with that build out. But because there is so much 449 00:21:35,200 --> 00:21:38,480 Speaker 9: investment that needs to happen, there's so much financing that 450 00:21:38,520 --> 00:21:42,520 Speaker 9: needs to happen. you don't have to race to pick 451 00:21:42,580 --> 00:21:45,420 Speaker 9: up everything that you see. There's going to be opportunities 452 00:21:45,460 --> 00:21:49,270 Speaker 9: that continue. And the opportunities that we like are from 453 00:21:49,330 --> 00:21:54,630 Speaker 9: businesses that have intrinsic value outside of AI and just 454 00:21:54,670 --> 00:21:58,230 Speaker 9: the models themselves. And because we think those businesses are 455 00:21:58,250 --> 00:22:00,209 Speaker 9: going to be the ones that are the most resilient 456 00:22:00,710 --> 00:22:02,050 Speaker 9: throughout this investment cycle. 457 00:22:02,730 --> 00:22:05,100 Speaker 8: Tiffany, a moment ago, you said there were three buffers 458 00:22:05,160 --> 00:22:08,170 Speaker 8: to support the resilience we've been seeing in equities. We 459 00:22:08,230 --> 00:22:11,450 Speaker 8: know one of them is the AI boom, but what 460 00:22:11,490 --> 00:22:12,170 Speaker 8: are the other two? 461 00:22:14,470 --> 00:22:15,170 Speaker 3: Yeah. 462 00:22:15,290 --> 00:22:17,910 Speaker 9: So we've also seen households, and this is not only 463 00:22:17,950 --> 00:22:20,630 Speaker 9: in the United States, but this is elsewhere, households have 464 00:22:20,670 --> 00:22:24,520 Speaker 9: been incredibly resilient despite a pretty big real income shock. 465 00:22:25,660 --> 00:22:30,220 Speaker 9: After the pandemic, household balance sheets were better than where 466 00:22:30,240 --> 00:22:33,080 Speaker 9: they were going into it. So that has been helpful. 467 00:22:34,350 --> 00:22:37,610 Speaker 9: And we've had this incredible wealth effect from equity gains 468 00:22:37,850 --> 00:22:40,690 Speaker 9: over the last several years. But in this ability of 469 00:22:40,770 --> 00:22:45,810 Speaker 9: households to draw on savings, to smooth through the energy 470 00:22:45,869 --> 00:22:50,880 Speaker 9: price shock, again, is very dependent on the financial conditions 471 00:22:50,920 --> 00:22:55,580 Speaker 9: pretty easy and stable, the AI sort of wealth effects 472 00:22:55,660 --> 00:22:59,020 Speaker 9: continuing to support the equity market. So that's why, you know, 473 00:22:59,040 --> 00:23:02,580 Speaker 9: we see all of this is more connected now. And 474 00:23:02,619 --> 00:23:05,959 Speaker 9: if you see, start to see sputtering or weakness, you know, 475 00:23:06,030 --> 00:23:09,830 Speaker 9: in either the AI investment story, the equity wealth story, 476 00:23:09,850 --> 00:23:13,149 Speaker 9: you know, that can create a very different macro environment 477 00:23:13,750 --> 00:23:14,669 Speaker 9: than what we're in today. 478 00:23:14,690 --> 00:23:19,090 Speaker 4: You know, I see the price of given bond portfolios, Tiffany, 479 00:23:19,170 --> 00:23:22,170 Speaker 4: and I understand this is outside your, I mean, Alexis, 480 00:23:22,210 --> 00:23:26,359 Speaker 4: let's be clear, Jerome Schneider has never lost money. Okay, 481 00:23:26,760 --> 00:23:30,430 Speaker 4: it's a true, this is known. But I looked, Tiffany, 482 00:23:30,830 --> 00:23:35,169 Speaker 4: it yielded up, priced down, and I guess there's a 4%, 6%, 8% 483 00:23:35,170 --> 00:23:40,020 Speaker 4: hit to a lot of portfolios this year. Does your 484 00:23:40,080 --> 00:23:44,980 Speaker 4: team at PIMCO, with your enthusiasm about a benign, robust economy, 485 00:23:45,600 --> 00:23:47,520 Speaker 4: just think that price will recover? Sure. 486 00:23:50,240 --> 00:23:52,939 Speaker 9: Well, the good news is in your bond portfolio right now, 487 00:23:53,180 --> 00:23:56,109 Speaker 9: price doesn't have to recover. So the fact that yields 488 00:23:56,150 --> 00:23:58,570 Speaker 9: have reset not only this year but in the last 489 00:23:58,609 --> 00:24:01,970 Speaker 9: several years has just created an incredible opportunity within the 490 00:24:02,010 --> 00:24:05,870 Speaker 9: bond market. You're basically getting paid to diversify. So although 491 00:24:05,890 --> 00:24:08,629 Speaker 9: you want to participate in the resilience, the bond market 492 00:24:08,730 --> 00:24:13,530 Speaker 9: is giving you yield, elevated yield levels to hedge against 493 00:24:13,570 --> 00:24:17,580 Speaker 9: that fragility. So you don't need– prices to recover in 494 00:24:17,619 --> 00:24:19,879 Speaker 9: order to have pretty good income and returns within your 495 00:24:19,900 --> 00:24:20,699 Speaker 9: bond portfolio. 496 00:24:20,740 --> 00:24:21,440 Speaker 5: So what does that. 497 00:24:21,340 --> 00:24:24,179 Speaker 4: Do from where you sit as an economist, but with 498 00:24:24,220 --> 00:24:27,460 Speaker 4: your quantitative background at Stern, what does that do to 499 00:24:27,510 --> 00:24:31,010 Speaker 4: the textbook 60-40 portfolio? Because we're getting a lot of 500 00:24:31,050 --> 00:24:34,750 Speaker 4: people saying, I mean, Jim Bianco saying buy bonds for 501 00:24:34,790 --> 00:24:36,930 Speaker 4: the first time in eight years. I mean, are you 502 00:24:36,970 --> 00:24:40,260 Speaker 4: guys uber bulls on bonds like Jim Bianco? 503 00:24:42,619 --> 00:24:44,100 Speaker 9: Yeah, I mean, we would agree that the bond market 504 00:24:44,140 --> 00:24:47,460 Speaker 9: is offering investors an incredible opportunity right now. 505 00:24:48,300 --> 00:24:49,340 Speaker 7: Yeah, and that's absolutely right. 506 00:24:49,400 --> 00:24:53,869 Speaker 9: PIMCO has also argued that the 60-40 bond portfolio, equity 507 00:24:53,910 --> 00:24:58,290 Speaker 9: bond portfolio, may be something of a little bit of 508 00:24:58,330 --> 00:25:01,070 Speaker 9: the past. Given the yields that you can get in 509 00:25:01,090 --> 00:25:05,800 Speaker 9: the bond market right now and tilting towards the bond 510 00:25:05,840 --> 00:25:08,160 Speaker 9: portion of your portfolio makes a lot of sense. Right. 511 00:25:08,220 --> 00:25:11,020 Speaker 9: You know, you can build a lot of resilience despite 512 00:25:11,119 --> 00:25:15,220 Speaker 9: the uncertain economic outlook by just focusing on on on 513 00:25:15,240 --> 00:25:15,960 Speaker 9: the bond market here. 514 00:25:16,180 --> 00:25:19,340 Speaker 4: Across America to her Newport Beach to Tiffany Wilding with us. 515 00:25:19,350 --> 00:25:22,990 Speaker 4: We'll continue with Miss Wilding with PIMCO. Can't say enough 516 00:25:23,050 --> 00:25:26,109 Speaker 4: about her work. Stephen Englander in this aisle for in 517 00:25:26,150 --> 00:25:29,270 Speaker 4: this hour, I should say, for Global Wall Street will 518 00:25:29,310 --> 00:25:31,669 Speaker 4: be with us on foreign exchange and the signals. 519 00:25:32,270 --> 00:25:37,040 Speaker 5: From a resilient U.S. dollar. Alexis Christophorus and Tiffany Wilder. 520 00:25:37,140 --> 00:25:39,979 Speaker 8: I'm intrigued by your talk of bonds, and I just 521 00:25:40,020 --> 00:25:41,700 Speaker 8: want to dig a little deeper. For people who want 522 00:25:41,740 --> 00:25:45,590 Speaker 8: to take advantage of that opportunity, drill down municipal bonds, 523 00:25:45,690 --> 00:25:48,590 Speaker 8: corporate bonds. Where within bonds would you be putting more 524 00:25:48,630 --> 00:25:49,170 Speaker 8: money to work? 525 00:25:51,170 --> 00:25:54,470 Speaker 9: Yeah, I mean, so we like a highly diversified portfolio. 526 00:25:54,609 --> 00:25:56,490 Speaker 9: And the argument that we would make is just that 527 00:25:56,530 --> 00:25:59,020 Speaker 9: you don't have to reach for a lot of risk here. 528 00:25:59,630 --> 00:26:03,879 Speaker 9: You can build incredibly resilient portfolio without giving up a 529 00:26:03,920 --> 00:26:06,800 Speaker 9: lot of yield. And you don't have to focus just 530 00:26:06,840 --> 00:26:09,679 Speaker 9: in the United States either. So when we look around 531 00:26:09,720 --> 00:26:11,820 Speaker 9: the world, it's not just the U.S. that you have 532 00:26:11,880 --> 00:26:15,719 Speaker 9: higher yields. We can build portfolios, you know, that are 533 00:26:15,720 --> 00:26:19,949 Speaker 9: 6 to 7 percent yielding that, you know, that are 534 00:26:19,990 --> 00:26:25,650 Speaker 9: highly diversified globally. You know, that looks like an incredible opportunity. 535 00:26:25,670 --> 00:26:30,859 Speaker 9: You know, that kind of returns historically. have been average 536 00:26:30,950 --> 00:26:33,179 Speaker 9: equity-like returns. So when you can do that with your 537 00:26:33,220 --> 00:26:35,700 Speaker 9: bond portfolio, you can do it in a diversified way, 538 00:26:35,720 --> 00:26:39,639 Speaker 9: that's what we argue that investors should be focused on. 539 00:26:40,369 --> 00:26:43,590 Speaker 9: Many investors, as a result of just the outperformance of 540 00:26:43,950 --> 00:26:47,210 Speaker 9: the equity market over the last decade, number of years, 541 00:26:47,590 --> 00:26:51,359 Speaker 9: passive investors, you know, are finding themselves over allocated. And 542 00:26:52,380 --> 00:26:55,440 Speaker 9: this is a good time to start to to rebalance, 543 00:26:55,480 --> 00:26:58,780 Speaker 9: start to build that balance within your portfolio, increase the 544 00:26:58,800 --> 00:27:01,700 Speaker 9: resiliency because you can lock in these higher yields here. 545 00:27:01,720 --> 00:27:05,330 Speaker 4: Tiffany Milding, thanks so much with PIMCO this morning. 546 00:27:05,369 --> 00:27:10,469 Speaker 5: Greatly appreciate that. Stay with us. 547 00:27:10,770 --> 00:27:13,990 Speaker 10: More from Bloomberg Surveillance coming up after this. 548 00:27:21,250 --> 00:27:24,859 Speaker 1: You're listening to the Bloomberg Surveillance Podcast. Catch us live 549 00:27:24,930 --> 00:27:27,020 Speaker 1: weekday afternoons from 7 to 10 a.m. 550 00:27:27,060 --> 00:27:27,460 Speaker 9: Eastern. 551 00:27:27,560 --> 00:27:30,840 Speaker 1: Listen on Apple CarPlay and Android Auto with the Bloomberg 552 00:27:30,880 --> 00:27:33,400 Speaker 1: Business app or watch us live on YouTube. 553 00:27:33,940 --> 00:27:37,260 Speaker 4: This is our interview of the day for Global Wall Street. 554 00:27:37,780 --> 00:27:42,320 Speaker 4: Stephen Englander is brilliant academics out of Yale University. He 555 00:27:42,359 --> 00:27:46,060 Speaker 4: was absolutely definitive in Manhattan. and now holds court at 556 00:27:46,100 --> 00:27:49,919 Speaker 4: the Standard Chartered Bank as well, on cross rates, on 557 00:27:49,960 --> 00:27:52,480 Speaker 4: the dollar, but in the zoo that we're living, so 558 00:27:52,520 --> 00:27:57,139 Speaker 4: much more. Stephen, I look at where we are, and 559 00:27:58,359 --> 00:28:02,830 Speaker 4: I wonder if we see movements of euro under 112, 560 00:28:02,830 --> 00:28:08,550 Speaker 4: yen 158. Are these movements where you say we're nearing breakpoints, 561 00:28:09,050 --> 00:28:13,890 Speaker 4: or are things operating smoothly within the dynamics of foreign exchange? 562 00:28:16,640 --> 00:28:20,500 Speaker 3: In the past, everything looked smooth. In the real time, 563 00:28:20,540 --> 00:28:21,679 Speaker 3: everything is chaotic. 564 00:28:22,440 --> 00:28:25,690 Speaker 11: And I think that the last week is mostly a 565 00:28:25,790 --> 00:28:27,550 Speaker 11: euro story. If you take a look at how it's 566 00:28:27,609 --> 00:28:31,669 Speaker 11: performed relative to other currencies, it's really very weak. 567 00:28:31,750 --> 00:28:35,860 Speaker 3: It's not a dollar move. It's a euro move. And 568 00:28:36,240 --> 00:28:40,280 Speaker 3: we see the concerns on French debt. 569 00:28:41,260 --> 00:28:43,720 Speaker 11: And how and french elections that are coming up and 570 00:28:43,780 --> 00:28:47,060 Speaker 11: so on now the you know it's recovered a bit 571 00:28:47,080 --> 00:28:50,670 Speaker 11: today but i think the market is still focused on 572 00:28:51,210 --> 00:28:54,190 Speaker 11: um the politics here and seeing that right you know 573 00:28:54,230 --> 00:28:56,490 Speaker 11: the the middle is shrinking and and that's the issue 574 00:28:56,510 --> 00:28:58,910 Speaker 11: for the euro the end i actually we think it's 575 00:28:58,950 --> 00:29:03,300 Speaker 11: a different story that the um Normally, you'd say dollar 576 00:29:03,340 --> 00:29:06,290 Speaker 11: going up, US rates going up, yen should be under pressure. 577 00:29:06,330 --> 00:29:08,330 Speaker 11: It's held in pretty well. We're beginning to be a 578 00:29:08,370 --> 00:29:11,990 Speaker 11: little bit more optimistic that maybe we've seen the top 579 00:29:12,210 --> 00:29:15,130 Speaker 11: of dollar-yen and certainly the top of euro-yen. 580 00:29:15,490 --> 00:29:18,590 Speaker 4: So you're suggesting yen weakness may be ebbing away and 581 00:29:18,690 --> 00:29:21,930 Speaker 4: finally we get strong yen? And if we get that, 582 00:29:21,950 --> 00:29:24,270 Speaker 4: I mean, with the rate structure in Japan, which is 583 00:29:24,370 --> 00:29:27,870 Speaker 4: unique this morning, all the money flows back to Japan, 584 00:29:27,970 --> 00:29:28,390 Speaker 4: doesn't it? 585 00:29:30,070 --> 00:29:32,780 Speaker 3: That would be, you know, that could be part of it. 586 00:29:32,830 --> 00:29:34,070 Speaker 3: That would be part of the story. 587 00:29:34,150 --> 00:29:36,890 Speaker 11: And, for the first time in a couple of generations, 588 00:29:36,970 --> 00:29:42,420 Speaker 11: in some ways, yen yields, certainly at the long end, 589 00:29:42,460 --> 00:29:46,640 Speaker 11: are kind of attractive. So that would be– that's a 590 00:29:46,680 --> 00:29:48,380 Speaker 11: possibility that we're entertaining. 591 00:29:48,440 --> 00:29:51,580 Speaker 3: And it's kind of a very recent possibility. 592 00:29:51,600 --> 00:29:56,300 Speaker 11: It's not the– it just– It looks like things are changing, 593 00:29:56,480 --> 00:30:00,780 Speaker 11: and we were much more bearish on the yen a 594 00:30:00,820 --> 00:30:01,420 Speaker 11: few months ago. 595 00:30:02,080 --> 00:30:04,120 Speaker 8: So, Stephen, what does all this mean for the U.S. 596 00:30:04,160 --> 00:30:07,280 Speaker 8: dollar and the rally that we've been seeing lately? And 597 00:30:07,300 --> 00:30:09,920 Speaker 8: I'm just wondering if there is a peak for Treasury 598 00:30:09,980 --> 00:30:11,780 Speaker 8: yields at where we're at. I mean, we're off the 599 00:30:11,800 --> 00:30:16,100 Speaker 8: 10-year today at around 5.29 percent, the 30-year at 5.66. 600 00:30:16,100 --> 00:30:19,600 Speaker 8: If there is a definitive peak for Treasury yields, does 601 00:30:19,620 --> 00:30:22,040 Speaker 8: the floor fall out from under a dollar rally? 602 00:30:25,530 --> 00:30:29,070 Speaker 3: Not necessarily, because I think treasury yields are kind of attractive. 603 00:30:29,330 --> 00:30:31,950 Speaker 11: And the other part of the dollar rally is what's 604 00:30:31,990 --> 00:30:34,690 Speaker 11: happening in equities, what's reflecting the strength of the U.S. 605 00:30:34,730 --> 00:30:35,270 Speaker 3: Economy. 606 00:30:35,890 --> 00:30:40,100 Speaker 11: So, yes, if treasury yields peak here, which we think 607 00:30:40,120 --> 00:30:43,900 Speaker 11: they'll go higher, but if they did peak here, maybe 608 00:30:43,980 --> 00:30:46,820 Speaker 11: the fixed income slows would sort of slow down a bit. 609 00:30:47,420 --> 00:30:51,460 Speaker 11: But you look at how the equity market has reacted here. 610 00:30:52,210 --> 00:30:57,500 Speaker 11: to a little bit of good news on PCE, a 611 00:30:57,540 --> 00:31:02,070 Speaker 11: little bit of softer labor markets, and we're back hitting 612 00:31:02,140 --> 00:31:05,330 Speaker 11: record highs, it would be the equity capital flow, the 613 00:31:05,430 --> 00:31:10,830 Speaker 11: private equity capital flow that we would need to support 614 00:31:10,850 --> 00:31:13,600 Speaker 11: the dollar. I'll just make a comment. We're all like 615 00:31:13,640 --> 00:31:16,360 Speaker 11: kids in a sandbox. Like, you know, the dollar goes 616 00:31:16,440 --> 00:31:18,200 Speaker 11: up half a percent every day. We expect it to 617 00:31:18,240 --> 00:31:21,040 Speaker 11: go up forever. I mean, that's not the way it works. 618 00:31:21,100 --> 00:31:24,750 Speaker 11: So a pause is very reasonable, but it doesn't mean 619 00:31:24,810 --> 00:31:25,690 Speaker 11: it's the end of the rally. 620 00:31:26,030 --> 00:31:28,430 Speaker 4: Stephen Englander with us today with our question, our global 621 00:31:28,450 --> 00:31:33,570 Speaker 4: Wall Street conversation of the day with the Standard Chartered Bank. Stephen, 622 00:31:33,590 --> 00:31:39,070 Speaker 4: at Yale University, you looked at the holistic view of finance. 623 00:31:39,770 --> 00:31:45,400 Speaker 4: We have Secretary Besant, talking about he's the house. That 624 00:31:45,440 --> 00:31:49,250 Speaker 4: has been crushed over the arc of two weeks, three weeks, whatever. 625 00:31:49,990 --> 00:31:55,300 Speaker 4: Discuss the Secretary's certitude that he is the house, that 626 00:31:55,320 --> 00:31:58,060 Speaker 4: the government, the Treasury's in charge. 627 00:32:00,590 --> 00:32:05,060 Speaker 3: Well, it might yet be true, and we'll find out 628 00:32:05,120 --> 00:32:05,660 Speaker 3: soon enough. 629 00:32:06,840 --> 00:32:11,010 Speaker 11: One comment I'd make is there's no point to saying 630 00:32:11,050 --> 00:32:14,090 Speaker 11: you're the house if you're not the house because everybody 631 00:32:14,130 --> 00:32:18,530 Speaker 11: will know it fast enough. So he may have some 632 00:32:18,550 --> 00:32:24,300 Speaker 11: insight into shifting BOJ policy. We'll see over time. I 633 00:32:24,620 --> 00:32:27,860 Speaker 11: think that they did sound somewhat hawkish at the last meeting. 634 00:32:29,340 --> 00:32:33,450 Speaker 11: It's possible that he, again, it's possible that he knows something. 635 00:32:34,960 --> 00:32:39,460 Speaker 11: But we do see sort of the possibility that we're, 636 00:32:39,680 --> 00:32:42,590 Speaker 11: you know, in the sense that the private sector outflows, 637 00:32:43,650 --> 00:32:46,790 Speaker 11: which have been very yield driven in the case of Japan, 638 00:32:47,010 --> 00:32:50,270 Speaker 11: that those might begin to slow down, which in many 639 00:32:50,310 --> 00:32:52,930 Speaker 11: ways is more important than what the policy is. 640 00:32:53,090 --> 00:32:54,760 Speaker 5: Is there a bet you can make here? 641 00:32:54,880 --> 00:32:57,100 Speaker 4: I don't mean like the specific morning bet of the 642 00:32:57,140 --> 00:33:00,800 Speaker 4: Standard Chartered Bank or late afternoon bet. on the Pacific Rim. 643 00:33:01,080 --> 00:33:04,300 Speaker 4: But are things so distorted, Dr. Englander, that you say 644 00:33:04,380 --> 00:33:07,440 Speaker 4: this is a point of entry in a given major pair? 645 00:33:10,660 --> 00:33:11,740 Speaker 3: You know, it's possible. 646 00:33:11,770 --> 00:33:14,970 Speaker 11: Look, Europe looks pretty weak, notwithstanding, you know, the euro 647 00:33:15,030 --> 00:33:18,310 Speaker 11: rallied half a percent today, but it's 112.65. Nobody expected 648 00:33:18,350 --> 00:33:22,170 Speaker 11: it to be here ever, you know, six months ago. 649 00:33:24,950 --> 00:33:27,970 Speaker 11: UK has its own economic and political problems. Swiss has 650 00:33:28,010 --> 00:33:32,800 Speaker 11: the lowest yields in the planet right now. There's a 651 00:33:32,820 --> 00:33:35,820 Speaker 11: lot of reasons to sort of say, look, maybe if 652 00:33:36,340 --> 00:33:40,780 Speaker 11: the yen is at the end of its decline, European 653 00:33:40,840 --> 00:33:44,420 Speaker 11: currencies are looking vulnerable. It's not the end of France's 654 00:33:44,460 --> 00:33:49,219 Speaker 11: political issues. It's just people got tired of selling, but 655 00:33:49,240 --> 00:33:55,510 Speaker 11: they'll come back. So I think that that contemplating the 656 00:33:55,550 --> 00:34:02,730 Speaker 11: possibility that maybe this move in Europe against the yen, 657 00:34:02,820 --> 00:34:05,380 Speaker 11: European currencies against the yen, which has been so, so 658 00:34:05,420 --> 00:34:09,080 Speaker 11: dramatic over a period of years, even if it's reversed 659 00:34:09,140 --> 00:34:11,779 Speaker 11: a quarter, that would be a massive move. 660 00:34:13,100 --> 00:34:15,520 Speaker 8: So I just want to take a macro look at 661 00:34:15,560 --> 00:34:18,940 Speaker 8: the economy with the midterms on the horizon. Is growth 662 00:34:18,960 --> 00:34:22,860 Speaker 8: the answer here, strong productivity-led growth? Is that going to 663 00:34:23,010 --> 00:34:24,870 Speaker 8: help our deficit problem? 664 00:34:26,890 --> 00:34:29,810 Speaker 3: Well, you know, strong productivity growth is great for a 665 00:34:29,830 --> 00:34:30,550 Speaker 3: lot of reasons. 666 00:34:31,530 --> 00:34:34,970 Speaker 11: And it will help our deficit problem, but not nearly 667 00:34:35,030 --> 00:34:37,630 Speaker 11: as much as it did, say, in the late 90s 668 00:34:37,710 --> 00:34:42,560 Speaker 11: and not nearly as much as... We had thought, I mean, 669 00:34:42,600 --> 00:34:45,339 Speaker 11: my colleague Dan Pan and I did some analysis on this. 670 00:34:45,960 --> 00:34:51,630 Speaker 11: The problem is that we collect tax revenues from personal income, 671 00:34:52,030 --> 00:34:57,089 Speaker 11: from wages, salaries, social security deductions, all sorts of things 672 00:34:57,130 --> 00:35:00,950 Speaker 11: like that. Corporate earnings and capital gains do not get 673 00:35:00,989 --> 00:35:05,560 Speaker 11: taxed very much. And so far, the growth is concentrated 674 00:35:05,800 --> 00:35:08,899 Speaker 11: in corporate earnings, profits, which is great because it leads 675 00:35:08,920 --> 00:35:13,149 Speaker 11: to further investment, and capital gains. 676 00:35:13,230 --> 00:35:16,350 Speaker 3: And the problem is that we're not going to see 677 00:35:16,390 --> 00:35:17,609 Speaker 3: the revenues from that. 678 00:35:17,670 --> 00:35:21,310 Speaker 11: We have to see stronger real wages and stronger employment 679 00:35:21,330 --> 00:35:24,009 Speaker 11: growth before that becomes a deficit saver. 680 00:35:24,380 --> 00:35:25,680 Speaker 3: And that's not on the horizon yet. 681 00:35:26,300 --> 00:35:28,939 Speaker 4: Stephen Englander, thank you so much for the time under 682 00:35:28,980 --> 00:35:32,580 Speaker 4: some duress. Greatly appreciate it with the Standard Chartered Bank today. 683 00:35:32,760 --> 00:35:37,680 Speaker 1: This is the Bloomberg Surveillance Podcast, available on Apple, Spotify, 684 00:35:37,800 --> 00:35:42,070 Speaker 1: and anywhere else you get your podcasts. Listen live each weekday, 685 00:35:42,070 --> 00:35:47,510 Speaker 1: 7 to 10 a.m. Eastern, on Bloomberg.com, the iHeartRadio app, TuneIn, 686 00:35:47,810 --> 00:35:50,890 Speaker 1: and the Bloomberg Business app. You can also watch us 687 00:35:50,989 --> 00:35:54,990 Speaker 1: live every weekday on YouTube and always on the Bloomberg Terminal. 688 00:35:58,550 --> 00:35:59,029 Speaker 2: Thank you.