Speaker 1: This is Bloomberg Business Week. I'm Carol Masser. Every day
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Speaker 1: let's get into it. So many headlines delighted to have
Speaker 1: with us. Dr William Moss, Executive Director of the International
Speaker 1: Vaccine Access Center, Professor in the Departments of Epidemiology, International Health,
Speaker 1: and Molecular Microbiology and Immunology at the Johns Hopkins Bloomberg
Speaker 1: School of Public Health, and of course the Johns Hopkins
Speaker 1: Bloomberg School of Public Health, supported by Michael R. Bloomberg,
Speaker 1: founder of Bloomberg LP and Bloomberg Philanthropies. Dr Moss with
Speaker 1: us on the phone in Baltimore. I wanted to lay
Speaker 1: it all out for everyone. Dr Moss. First of all,
Speaker 1: thank you so much for being here, Um, I do
Speaker 1: feel like there's so much going on, and I feel
Speaker 1: like it's it's some optimism and yet again a reminder
Speaker 1: that we are still in a global pandemic. That's worrisome.
Speaker 1: Yes it is, and thank you for having me, Carol. Um.
Speaker 1: We are seeing record numbers of cases in the United States.
Speaker 1: We're seeing high numbers of deaths, hospitals that are really
Speaker 1: being stretched to the limits, and that that pattern is
Speaker 1: going to continue for the next couple of months as
Speaker 1: we head into winter, more more people being indoors, more
Speaker 1: people interact indoors into the holiday season. But as you
Speaker 1: said there, we also have some optimism with the reports
Speaker 1: of the vaccine efficacy from the fist or vaccine being
Speaker 1: much higher than people expected, recognizing that we only know
Speaker 1: about this through a press release presumably from a review
Speaker 1: of the data by an independent day if they monitoring board.
Speaker 1: But well, we still do not know right as as
Speaker 1: these headlines come out from a fiser. We're anticipating some
Speaker 1: news from Maderna as well. That's promising. We don't know
Speaker 1: what how long protection lasts. We don't know exactly what
Speaker 1: these vaccine ultimately will do. Right, that's right there, are
Speaker 1: still a number of outstanding questions. Then I have a
Speaker 1: confidence will be able to answer these questions. But what
Speaker 1: we know now is that in this late stage of
Speaker 1: these phase three clinical trials, with the results from the
Speaker 1: Fiser vaccine demonstrating showing you know, high protection of people
Speaker 1: who got the vaccine were protected compared to the placebo group. UM.
Speaker 1: But as you said, there's still a number of outstanding questions.
Speaker 1: For example, we don't know what the vaccine efficacy is
Speaker 1: in older adults or people with underlying medical conditions that
Speaker 1: place them at higher risk for severe disease of COVID
Speaker 1: nineteen that come out of the trial results, But we
Speaker 1: don't know that now. We don't know how long this
Speaker 1: protection is gonna last. We hope it's gonna last a year,
Speaker 1: years or more UM, but we just don't know, and
Speaker 1: that's going to take further follow of these participants in
Speaker 1: the trials Until we really know how long the protection lasts.
Speaker 1: We also won't know whether they're the long term side effects. UM. Again,
Speaker 1: we need the longer follow up, We need the full
Speaker 1: trial data to be able to see that. But right now,
Speaker 1: what we'll be able to say is in the short term,
Speaker 1: this these vaccines look protective, vaccines look safe. At least
Speaker 1: that's what I'm hoping for. Well, yes, fingers crossed, right,
Speaker 1: Dr Mossa. What happens next? Um? You know, I do
Speaker 1: feel like we are all learning about I've said it before,
Speaker 1: how the sausage is made in terms of vaccine development, right,
Speaker 1: and we're all talking about it so much. And I
Speaker 1: know that there's some nervousness about the rapidity of the process,
Speaker 1: but we are learning about how it all happens. So
Speaker 1: what's kind of next year, whether it's the Fiser vaccine,
Speaker 1: whether it's Maderna's vaccine. What are you anticipating how things
Speaker 1: play out over the next few weeks, a few months. Yes,
Speaker 1: and you're exactly right. I don't think there's ever been
Speaker 1: such public scrutiny of the vaccine development and evaluation products.
Speaker 1: What we anticipate happening next is that a company such
Speaker 1: as Fiser Maderna will need to put admit an application
Speaker 1: to the Food and Drug Administration for emergency use authorization
Speaker 1: so that these vaccines could be made available to high
Speaker 1: risk individuals as early as possible. What the Food and
Speaker 1: Drug Administration has put forth as guidelines is that the
Speaker 1: trials need to wait until at least half of the
Speaker 1: participants have had two months of follow up uh. Fiser
Speaker 1: anticipates that that's going to happen later this month or
Speaker 1: fourth week of November, and then they will be able
Speaker 1: to submit their application for an emergency use authorization to
Speaker 1: the f d A. The the all the trial data
Speaker 1: will then be reviewed by an independent body. Hopefully data
Speaker 1: will be made public. Hopefully this whole process will be transparent.
Speaker 1: We need that for the public's trust UM and they
Speaker 1: would anticipate shortly after the application and this review process
Speaker 1: that there would be, assuming the safety and efficacy data
Speaker 1: hold up UM, that will have an emergency use authorization.
Speaker 1: Fiser says that they'll have forty fifty million doses ready
Speaker 1: to go UM by the end of this year. That's
Speaker 1: been one of the things that's allowed this process to
Speaker 1: be accelerated, that the manufacturing has has gone on with
Speaker 1: the studies and nothing changes. Right. The drug is the drug,
Speaker 1: so it's not like wait a minute, up, so we
Speaker 1: have to tinker with the vaccine a little bit, right
Speaker 1: what it is, and that's why they've been all to vaccine,
Speaker 1: I mean to manufacture the vaccine exactly, so you know,
Speaker 1: there would have not be any any kind of changes
Speaker 1: to the vaccine that was used during the trials. They have,
Speaker 1: but they have scaled up that manufacturing. So bottom line,
Speaker 1: emergency use, Dr Moss, you anticipated by the end of
Speaker 1: the year, especially for those who really need it. I
Speaker 1: think so. Again, assuming that the safety and efficacy data
Speaker 1: hold up that we're hearing about through this press release,
Speaker 1: I would expect by the end of this year, and
Speaker 1: and perhaps earlier in December, that we would have an
Speaker 1: emergency use authorization and begin to h Then then we
Speaker 1: could begin to provide the vaccine to the high risk
Speaker 1: individuals that may be healthcare workers and older adults. So
Speaker 1: one of the things I wanted to ask you is
Speaker 1: there was a story, Doctor Moss that talked specifically and
Speaker 1: let me just find it. It had to do with
Speaker 1: I think MINX and just what that meant the COVID explosion. Mink.
Speaker 1: Our headline was that it's a dangerous sign for vaccines. Um,
Speaker 1: tell me what we need to know and what this
Speaker 1: might mean. Well, what what we want to know it
Speaker 1: is a fascinating story, is whether this virus can be
Speaker 1: transmitted among animals? Uh that are you know, potentially introduced
Speaker 1: from humans to animals. We know that that this virus
Speaker 1: probably started in animals, perhaps bats uh, and then was
Speaker 1: transmitted to humans UM. But finding the virus circulating in
Speaker 1: other wild animals UM makes it, you know, raises concerns
Speaker 1: about our ability to really rid ourselves of this virus.
Speaker 1: UM would the virus can mutate and change its genetic
Speaker 1: structure within animals UM, but it also animals wild animals
Speaker 1: can also serve as a reservoir of the virus, potentially
Speaker 1: sending the virus back into human populations. That's what we
Speaker 1: would be concerned about. We don't have evidence of that yet,
Speaker 1: but that's why that was such a important news. So
Speaker 1: if that was the case, that animals can serve as
Speaker 1: a reservoir to send the virus back to humans, it
Speaker 1: just sounds terrible. Does that mean that we could potentially
Speaker 1: have a world where we are just constantly dealing with
Speaker 1: this Yes, and even without an animal reservoir, you know,
Speaker 1: another a new animal reservoir or another animal reservoir, we
Speaker 1: still maybe living with this virus for a long time.
Speaker 1: It's clear that we're going to be able to eradicate
Speaker 1: this virus from human transmission. But if we're able to
Speaker 1: achieve and and we you know that's potentially possible with
Speaker 1: a highly effective vaccine that that stops transmission um. Having
Speaker 1: an animal reservoir just that's so much more difficult because
Speaker 1: potentially we could have new human infections. Okay, I'm just
Speaker 1: sitting with that. So what I'm trying to yeah, right,
Speaker 1: just just kind of like layer it on. You know.
Speaker 1: The other thing I guess I've been trying to get
Speaker 1: my head around is I mean the virus that we
Speaker 1: deal with, the seasonal flu virus that we deal with, right,
Speaker 1: it mutates, right, and we're constantly trying to come up
Speaker 1: with new vaccines. You can alter it and kind of
Speaker 1: keep ahead of it. As a COVID nineteen, Well it's
Speaker 1: COVID nineteen because of when it started getting you know,
Speaker 1: coming in. But this particular strain of coronavirus, as it mutates,
Speaker 1: how quickly is it or how easily is it to
Speaker 1: adapt an existing vaccine to keep up with the mutations. Right,
Speaker 1: That's a really important question. And you know, influenza is
Speaker 1: a very different type of virus. Um. It has the
Speaker 1: ability to kind of swap out pieces of itself. Uh,
Speaker 1: it's it's genetic it's genome um and that allows it
Speaker 1: to make big changes. That's why we get pandemic influenza.
Speaker 1: But even smaller changes are are why we need to
Speaker 1: have a different vaccine each year. Corona the Stars coronavirus
Speaker 1: two does mutate. All viruses mutate, all all viruses change
Speaker 1: their genetic structure, but we we haven't seen that. We
Speaker 1: don't see the degree of mutation and change, uh, certainly
Speaker 1: that we see with influenza viruses. And just to give
Speaker 1: you another example, the measles the measles vaccine that we
Speaker 1: use in most of the world in the United States
Speaker 1: that came from a wild type measles virus isolate from
Speaker 1: the nineteen fifties, and we have not needed to change
Speaker 1: our measles vaccines over time. So I think that the
Speaker 1: coronavirus will be closer to measles than to influenza in
Speaker 1: terms of our need to uh constantly update or reinvent
Speaker 1: our our coronavirus vaccines. So that's a good thing, right, Yes,
Speaker 1: that's a good thing. Yes. So what do you anticipate,
Speaker 1: I mean, do you feel like you have some visibility?
Speaker 1: I felt like the world got some visibility Monday because
Speaker 1: of Fiser and we felt a little bit more confident.
Speaker 1: UM just got about fifty seconds left. You feel like
Speaker 1: a year from now we're able to open up society
Speaker 1: more than you know, than we have been. Or is
Speaker 1: it a shorter time frame or a longer time frame?
Speaker 1: What do you think? Yes, I'm optimistic that we'll be
Speaker 1: able to data vactors will be able to have enough vaccine,
Speaker 1: probably different types of vaccines, and be able to get
Speaker 1: these to the general public probably in mid to late one,
Speaker 1: and that that will help us begin open up. But
Speaker 1: I think it's very important for people to know that
Speaker 1: that's not going to happen in January. In February and March,
Speaker 1: we're going to have We're facing a very difficult winter,
Speaker 1: I think here in the United States and i'm sure
Speaker 1: in Europe, UM, and we're gonna need to continue to
Speaker 1: to wear masks and and distance and wash our hands
Speaker 1: and all those met those public health measures until later year.
Speaker 1: I'm glad you said that masks and social distancing because
Speaker 1: I just want everyone to remember, UM and we've been
Speaker 1: talking to a lot of folks right it's multifaceted and
Speaker 1: getting this under control, UM, Dr Moss Brilliant, executive director
Speaker 1: of the International Vaccine Access Center at Johns Hopkins, joining
Speaker 1: us on the phone from Baltimore. This is Bloomberg Business
Speaker 1: Week with Carol Messer from Bloomberg Radio. All right, do
Speaker 1: you want to get into something that kicks off on Monday.
Speaker 1: We're talking about the Bloomberg New Economy Form. It kicks
Speaker 1: off virtually four days of incredible global, global programming with
Speaker 1: a blockbuster lineup of leaders, and they cover kind of
Speaker 1: all the global concerns that we need to be talking about.
Speaker 1: It's also, by the way, our cover story this week.
Speaker 1: Let's get into it with Business Week Economics editor Christina
Speaker 1: Lynn Blatch. She's in our Bloomberg Interactive Broker studio, and
Speaker 1: also with us Bloomberg Business Week Editor Joel Webber, he
Speaker 1: is on the phone in Brooklyn. Until you have an
Speaker 1: array of stories in the magazine that relate to the
Speaker 1: Bloomberg New Economy Forum, that's right, And and really Christina
Speaker 1: was the architect of this little package of stories and
Speaker 1: and she did a great job. And that was one
Speaker 1: of the reasons that um I wanted to have around
Speaker 1: the show today. And obviously we talked about Zel yesterday,
Speaker 1: which is um, I thought just a phenomenally interesting one,
Speaker 1: UM in regards to Venezuela and sort of how people
Speaker 1: they are making use of it to do something that
Speaker 1: you know, the company and you know Zell never intended
Speaker 1: to have happened. Um. And that's just sort of an example.
Speaker 1: I think of the approach that Christina used throughout the
Speaker 1: issue is sort of like, how do we tap into
Speaker 1: some of these biggest challenges that that we face, that
Speaker 1: humanity faces, And obviously that kind of starts with the
Speaker 1: pandemic since that is the you know, one of the
Speaker 1: stories of the year for sure. UM, Christina can that
Speaker 1: and kind of lay out, um, what what you learned
Speaker 1: about this story by Jason Galen and Longhaulers. Yeah, thanks
Speaker 1: Carol for having me on. I've been interested in the
Speaker 1: long haulers for a while because I think we were
Speaker 1: also focused for every day still on infection rates and
Speaker 1: hospitalizations and and and that, but also to understand that
Speaker 1: there are people who some of them have symptoms that
Speaker 1: are so bad that they're almost disabled, they cannot go
Speaker 1: back to work and it's been several months, and and
Speaker 1: that the scientific and health community can't answer the questions
Speaker 1: that they have about whether they're ultimately going to be
Speaker 1: done with this, you know, how long are they going
Speaker 1: to have these symptoms? Well, and it's interesting Christina, considering um,
Speaker 1: you know, I think there's sometimes some populations being kind
Speaker 1: of cavalier about COVID nineteen. And you have to remember that,
Speaker 1: you know, some people get it, they don't have a
Speaker 1: lot of um, you know, leftover effects if you will,
Speaker 1: and then other people get it and it stays with them,
Speaker 1: as you just said, for a really long time. It's
Speaker 1: just a reminder that this virus packs us all in
Speaker 1: very different ways. That's right. Actually, one of the things
Speaker 1: that we found is that sometimes people who had no symptoms,
Speaker 1: are very light symptoms actually had the biggest problems with
Speaker 1: you know, the sort of long term viral um hangover
Speaker 1: you would say, hm, and you know the other hangover
Speaker 1: that um we're all going to kind of be faced with.
Speaker 1: Here is the economic implications of this, because COVID can
Speaker 1: have multi organ impacts and implications, and we're also starting
Speaker 1: to see that there will be an impact in terms
Speaker 1: of disability. What does that mean for all of us? Christina? Well,
Speaker 1: that's I think we talked to several researchers who are
Speaker 1: trying to answer just that question, and something that's starting
Speaker 1: to grapple with I mean, there have been comparisons to polio,
Speaker 1: for instance, to try to have long range estimates. So
Speaker 1: what would it be like if there had been no
Speaker 1: vaccines that you know, they came in at the right time.
Speaker 1: And I think that's going to be important here. Obviously
Speaker 1: the vaccine, you know, not to have more infected population,
Speaker 1: but we still will have to answer the questions of
Speaker 1: how we help people who UM have damaged their organs,
Speaker 1: their hearts UM and sometimes need UM not just pulmonary rehabilitation,
Speaker 1: but they're also having people describe brain fogs. M. So
Speaker 1: Christine and I want to talk to about Tom or
Speaker 1: like a Bloomberg economic story which sort of talks about
Speaker 1: how they've done. They crunch a bunch of numbers to
Speaker 1: try and figure out sort of what the path of
Speaker 1: global economies is going to look like over the next
Speaker 1: couple of years and decades, and they go so far
Speaker 1: as to say, right about, we're going to see a
Speaker 1: shift in terms of UM free market economies being overtaken
Speaker 1: by by state driven ones. UM. Can you talk about
Speaker 1: what where else he goes in that story and what
Speaker 1: it means for for us. Can I just say to
Speaker 1: this is a must read. Everybody has to read this
Speaker 1: to kind of understand, I think where our world is going. Christina, Yeah,
Speaker 1: I think he did a good job of laying out
Speaker 1: where where we're going to be at mid century and
Speaker 1: to put numbers to something that we've been tracking for
Speaker 1: a while, which is the sort of some people said
Speaker 1: the Asian century, you know, like that this the century
Speaker 1: belongs to Asia and so overall emerging markets. Um at
Speaker 1: the start of the century where about of GDP, but
Speaker 1: you know, through by twenty fifty, there will be more
Speaker 1: than half, almost six, and China will be by far,
Speaker 1: you know, the biggest um the biggest part of that.
Speaker 1: And we have this great graphic that sort of shows
Speaker 1: the reordering of the top ten economies, you know, and
Speaker 1: basically China bumps the US off the number one slot,
Speaker 1: India bumps Japan out of number three slot, and you know,
Speaker 1: and you see sort of the kind of youthful developing markets,
Speaker 1: you know, moving up and the sort of aging econom
Speaker 1: me is moving down. I gotta I have to say,
Speaker 1: like I said, this is a mustery, but there's a
Speaker 1: line in the story. It's optimistic to assume that all
Speaker 1: these transitions will be smooth. Ha, Like it's going to
Speaker 1: be uncomfortable right as these changes happen globally, well we've
Speaker 1: seen in the last four years and even now when Biden,
Speaker 1: you know, will assume office that that, um, the big
Speaker 1: power struggles that are going on right there, going on
Speaker 1: in the fields of trade of I P, you know,
Speaker 1: and all these different dimensions. I mean, there's this idea
Speaker 1: that you know that it's there's bound to be conflict
Speaker 1: when there are these these sort of disruptions in the
Speaker 1: in the sort of established order. Christian. I also want
Speaker 1: to talk about the other elephant in the room, which
Speaker 1: is climate change. And I know Eric Crosston was on
Speaker 1: program yesterday talk about the story the wildfire story uh
Speaker 1: in California, which is this, you know, really a case
Speaker 1: in how bad wildfires can get and as climate change
Speaker 1: amplifies these things to make it worse. It's it's it
Speaker 1: means millions of people find themselves with fires at the
Speaker 1: front door, when you know, just a few decades ago
Speaker 1: that wasn't a problem. Uh. And want to talk about
Speaker 1: the angle that was really in that story around insurance
Speaker 1: and what it means for that industry. Well, I think
Speaker 1: what was really interesting about that stories is to focus
Speaker 1: on the modeling of risk, which is integral to the
Speaker 1: insurance industry. So for flooding, for example, there's been years
Speaker 1: um of work already done on what areas and homes
Speaker 1: are at risk. But for fire, this is a much
Speaker 1: more emerging field. Maybe not so much emerging, but that
Speaker 1: there's so many factors, more factors at work. UM that
Speaker 1: we talked, for example, to people who are building these
Speaker 1: models and saying, oh, I can never actually finish building
Speaker 1: this model because then we realized, you know, there's this
Speaker 1: other factor that we didn't account for properly. Well, this
Speaker 1: these models formed the foundation of kind of of how
Speaker 1: the insurance industry looks at the risk that it faces
Speaker 1: in that state. And we have this great anecdote about
Speaker 1: one UM scientists who delivered a presentation and in the
Speaker 1: audience where several people representative from the insurance industry. His
Speaker 1: presentation was about what happens in fires that breakout in
Speaker 1: canyons um and and the people after came up to
Speaker 1: him and said, that's it. We're done, Like we're getting
Speaker 1: out of the state. It's like, if you know what
Speaker 1: I mean, if the just such crazy scary scenarios that yeah,
Speaker 1: it's just you know, things that we've never thought we'd
Speaker 1: be dealing with. But right, and there's so many implications
Speaker 1: of it. Um great stuff as always Bloomberg Business Week,
Speaker 1: Economics that are Christina Lynn Blad and of course our
Speaker 1: Bloomberg Business we get it, or Joel Weber joining us,
Speaker 1: the Bloomberg New Economy form. It does kick off on Monday.
Speaker 1: It's virtually it's four days of global programming, a blockbuster agenda,
Speaker 1: a lineup of leaders in business, government, finance, the market's, healthcare, climate,
Speaker 1: you name it. And they are dealing with everything from
Speaker 1: the coronavirus to climate change, really the biggest challenges humanity faces.
Speaker 1: I'm looking forward to a panel I'm doing later in
Speaker 1: the week that's all about how did we get here
Speaker 1: when it comes to a virus. It's amazing in terms
Speaker 1: of the lineup. This is Bloomberg Business Week with furo
Speaker 1: Master on Bloomberg Radio. Yes, indeed, you are listening to
Speaker 1: Bloomberg Business Week. We're gonna stay with politics from a
Speaker 1: We just talked with Jonathan Bernstein about Joe Biden's pick
Speaker 1: uh for his White House chief of staff. But we
Speaker 1: want to get to what seems to feel like some
Speaker 1: a little bit of a political shift in uh the
Speaker 1: horror should say, a shift in the political wins. Yeah,
Speaker 1: I'll get that out, um, at least when it comes
Speaker 1: to President Trump support from some key conservatives. Back with
Speaker 1: us on what's going on and why, Bloomberg News Politics
Speaker 1: editor Wendy Benjaminson. She is back with us on the
Speaker 1: phone from d C. I'm just trying to keep up
Speaker 1: with the headlines. I'm just gonna tell you, um, what's
Speaker 1: going on with the conservatives and kind of coming out
Speaker 1: like it's time to call this election. Basically back off.
Speaker 1: It's at least that's what it feels like, Wendy. It
Speaker 1: feels like that Carol High and yet it's not quite
Speaker 1: that yet. What they're saying is that he should be
Speaker 1: getting an intelligence briefing every day, which every president elect gets, um,
Speaker 1: a secure intelligence briefing what's going on in the world,
Speaker 1: because he's going to take over on January twenty, and
Speaker 1: they sort of like to know what's going on before
Speaker 1: they get into the Oval office. Because the Trump administration
Speaker 1: is blocking his access to the normal transition activities. Joe Biden,
Speaker 1: who even though he's a former vice president, is now
Speaker 1: a private citizen yet president elect um, he doesn't have
Speaker 1: access to classified information and they will not make those available.
Speaker 1: So some conservative senators, especially those on the Senate Intelligence Committee,
Speaker 1: are saying, come on, at least give him the intelligence
Speaker 1: briefings in case he's president. We think it's better for
Speaker 1: the war old that he has, you know, deep inside
Speaker 1: into what's going on. Well, we as Americans, should we
Speaker 1: be concerned that he's not? I don't think terribly concerned.
Speaker 1: Biden himself said that at a news conference that he
Speaker 1: held on Wednesday Tuesday. Excuse me, he said he would
Speaker 1: it would be nice if he was getting it, but
Speaker 1: he's confident that he'll be able to catch up. Of course,
Speaker 1: that's him trying to create a contrast. Biden has been
Speaker 1: very careful lately to project this calm, everything's okay, a
Speaker 1: worry sort of attitude, while Trump is um. While President
Speaker 1: Trump is rage tweeting. So it's um. It's it's a strategy,
Speaker 1: of course, Well, what's going on in the White House?
Speaker 1: I gotta ask you. I think one of our top
Speaker 1: red stories is about kind of Fox News or Fox
Speaker 1: The shares are down because there's concerns about, you know,
Speaker 1: President Trump, what he's going to do next and maybe
Speaker 1: create a competing network or be part of a competing network.
Speaker 1: What's going on here? I even saw some betting markets
Speaker 1: are suggesting he's going to replace Alex Trebek as host
Speaker 1: of Jeopardy. I don't think that happen either. That wasn't
Speaker 1: an official official prediction. Um. What's going on in the
Speaker 1: White House? Anyone's guess as good as mine. We UM.
Speaker 1: No one has seen I mean, no one outside the
Speaker 1: White House has seen the president, um, except for that
Speaker 1: golf outing over the weekend or and he went to
Speaker 1: the memorial. But he hasn't had any public statements, He
Speaker 1: hasn't had any public activities or invited reporters and photographers
Speaker 1: into the Oval office like he normally does. So you know,
Speaker 1: we all we know about what he's thinking and doing
Speaker 1: is from is from his tweets, UM, and a few
Speaker 1: executive orders that he's been putting out. UM. But otherwise, yeah,
Speaker 1: he's UM, he's just quietly doing his job. Yeah right, yeah, exactly. Well,
Speaker 1: what's interesting going back to you know some of the
Speaker 1: Republicans I do under Wendy, I mean, do they want essentially,
Speaker 1: can they get an assist? Do they need an assist
Speaker 1: from President Trump? When it comes to those outstanding Georgia
Speaker 1: Senate races? Can he help them in terms of winning
Speaker 1: no seats? Oh? I think he could. I think he could.
Speaker 1: And there are there is a lot of money on
Speaker 1: both sides going down to Georgia. Um, there is a
Speaker 1: lot of the Democrats will be fighting for those seats
Speaker 1: very hard. Um, and so will the Republicans. Whether Donald
Speaker 1: Trump himself will go down to Georgia and help them campaign,
Speaker 1: it's hard to tell if he has decided that he's
Speaker 1: lost the election. I mean, if he comes to the
Speaker 1: realization that he's lost the election before, then he might
Speaker 1: not bother. It's not really in his personality to work
Speaker 1: for the good of the party when it doesn't benefit
Speaker 1: him personally. I'm not trying to be subjective. I just
Speaker 1: after observing him for four years, UM, so I'm not
Speaker 1: sure he would he would bother trying to help form
Speaker 1: a Republican Senate if he's not going to be president. Um. Well,
Speaker 1: and then, and then what's kind of the role of
Speaker 1: Mitch McConnell and all of this right, because I think
Speaker 1: I was, I don't know. I think I was surprised
Speaker 1: initially when Mitch McConnell, who had been quiet, you know,
Speaker 1: and then came out and basically said, you know, the
Speaker 1: president has a right to a recount. And I think
Speaker 1: that's fair right. Anybody who says a close race has
Speaker 1: has the right. But where's Mitch McConnell. What's going on
Speaker 1: behind the scenes, What are you guys hearing? Well? The
Speaker 1: sun of Majority Leader is UM. He is right that
Speaker 1: the president has a right to a recount. Anyone does UM.
Speaker 1: I think you know that he is. He's also saying
Speaker 1: there has to be evidence. He's saying there shouldn't be
Speaker 1: any you know, far fetched claims, UM. And I think privately,
Speaker 1: my guess is, and it's just a guess, is that
Speaker 1: behind the scenes, he's thinking it's over and he's making
Speaker 1: plans to UM. But he's making plans to have a
Speaker 1: Republican Senate then will stop UM? President elected Biden's most
Speaker 1: progressive instincts. But it's still up in the air right
Speaker 1: until those races happen. It's up in the air until
Speaker 1: those races happen. Right there. They right now. I think
Speaker 1: it's in the Senate pretty well. If if the Democrats
Speaker 1: get one more, then Vice President Kamala Harris could be
Speaker 1: the tiebreaker. If they get two more than they wouldn't
Speaker 1: even need her. But Republicans get one more, then um,
Speaker 1: they have the majority. You know. It is interesting too,
Speaker 1: as you said, the president being kind of quiet. But
Speaker 1: you know, we had a headline we just mentioned a
Speaker 1: little whiles ago, a little while ago, excuse me, about
Speaker 1: the president banning investment in some Chinese companies, so you know,
Speaker 1: and he's talking about a military type So he's still
Speaker 1: doing things and we do guys and your team put
Speaker 1: out that there are things he will do can do
Speaker 1: that will upset certainly the global community or upset financial markets.
Speaker 1: Oh absolutely, Carol. I mean he is president until noon
Speaker 1: on January twentie, so he can do a tremendous number
Speaker 1: of things that he's and and any president he can
Speaker 1: do whatever that he would normally do until January twenty.
Speaker 1: Normally they begin to work sort of in concert with
Speaker 1: each other. They try not to just mess things up
Speaker 1: before the other guy comes there. But um, you know,
Speaker 1: we'll see what happens this year. All right, So, Wendy,
Speaker 1: I mean, we're in a COVID world sets like you
Speaker 1: can jump on a plane after all this is over
Speaker 1: and things calm down and go to the Caribbean. But
Speaker 1: I do wonder when do you guys and your team
Speaker 1: anticipate that things start to slow down? Is it after
Speaker 1: we get through these senate races? When is it ultimately?
Speaker 1: I mean, I know we're gonna have a new administration,
Speaker 1: but I mean once we get through still kind of
Speaker 1: these outstanding races, right, I think really it will be
Speaker 1: when the president concedes, that concedes the race. Um, you know,
Speaker 1: President elect Biden is Um, he's having called the foreign leaders,
Speaker 1: but he's gone to his house on the beach for
Speaker 1: the weekend. Um. You know, he's he's taking he's making appointments,
Speaker 1: but he's moving in such a sort of deliberate, traditional
Speaker 1: um way that we can already see the pace of
Speaker 1: the next administration will be much more like what we're
Speaker 1: used to before. A little normalcy would be okay, a
Speaker 1: little calm. Right. I'm assuming she would have said yes,
Speaker 1: all right. Bloomberg News Politics editor Wendy Benjamin soon joining
Speaker 1: us on the phone from Washington, d C. Check it
Speaker 1: all the political coverage. Uh, you can just go to
Speaker 1: the Bloomberg terminal or check out Bloomberg dot com room
Speaker 1: journal now, but you let me drive? No, no, no,
Speaker 1: drive home, honey please, I'll do the riding drivel Let
Speaker 1: me I want to drive, Just drive baby, good question trying.
Speaker 1: This is the drive to the globe. Give me thanks,
Speaker 1: we'll drying us down on Bloomberg radio. Is indeed time
Speaker 1: for the drive to the close. Quick check on where
Speaker 1: we are just with about thirteen minutes left to today's
Speaker 1: trading session, are about twelve minutes actually SNP five hundred,
Speaker 1: we're down fifty one points, down one point at twenty one.
Speaker 1: Now at fifteen, that's such a line of four hundred
Speaker 1: eighty points, down one point six percent. And you've got
Speaker 1: the nasdack the outperformer, but still down, but down only
Speaker 1: about nine tenths of one percent, a loss of a
Speaker 1: hundred and nine points. Do also want to get a
Speaker 1: check on the treasury trade. We've got equities pretty much
Speaker 1: near the loads of the session. Big moves and equities
Speaker 1: we've all also seen some big moves when it comes
Speaker 1: to uh, the yields and all along the yield curve,
Speaker 1: you've got that tenuere note with the yield of point
Speaker 1: eight seven nine, you've got the five year note yielding
Speaker 1: point thirty nine and taking a look at the shorter
Speaker 1: end of the yiel curve that two year notes, specifically,
Speaker 1: UH down with the yield um I should say, actually up,
Speaker 1: but the yield down to point one seven. All right,
Speaker 1: Let's bring in Leslie Falconio. She runs the Tactical Asset
Speaker 1: Allocation UH team within US Fixed Income over at UBS
Speaker 1: Wealth Management, senior strategist at UBS. UH there and joins
Speaker 1: us on the phone from Florida. It is good to
Speaker 1: have you here, Leslie, and I feel like it's really
Speaker 1: timely in topical because we're watching equity sell off investors
Speaker 1: moving into treasuries. This trade, it was a very different
Speaker 1: trade or earlier in the week, Which one is right?
Speaker 1: You know, over the long term, the earlier one of
Speaker 1: the week is right. I mean there's no question that
Speaker 1: you know, we saw this a little bit large of
Speaker 1: a bear steep. Every industrates rose the long and underperformed
Speaker 1: for two reasons. One, we had historic supply this week
Speaker 1: right in the tenure in the bond and also from
Speaker 1: the news from Fiser too which really pushed out and
Speaker 1: had the hopes of the end of the pandemic, which
Speaker 1: pushed out this growth and inflation outlook. So I do
Speaker 1: think that over the longer term, this bear steeper is
Speaker 1: going to be the right allocation. Right now is expected
Speaker 1: because the yields moved so high and you are going
Speaker 1: into the winter months, it's expected to have a temporary pullback,
Speaker 1: right exactly. So what's your advice to investors? Just kind
Speaker 1: of sit tight, just believe in that earlier the trade,
Speaker 1: earlier in the week, and just understand that we're going
Speaker 1: to see some volatility. I think that's absolutely true. I mean,
Speaker 1: I think I think that the point is is that
Speaker 1: even though we don't know the exact amount of statophysical
Speaker 1: simul Savada and a lot of headlines on that today,
Speaker 1: you do believe that it will come. It will mostly
Speaker 1: come in you know, the first quarter. It's very difficult
Speaker 1: to say the amount, But just understand that, as we know,
Speaker 1: we've had a lot of monetary and fiscal stimulus in
Speaker 1: this system. There's a lot of liquidity in the system.
Speaker 1: We're seeing things like such as corporate spreads, high yield
Speaker 1: and invest in grade corporate tighten well to pre pre
Speaker 1: COVID level. So again there's gonna be the short term
Speaker 1: sort of you know, pockets of vulnerability as the headline
Speaker 1: risk comes across with COVID, particularly as we enter the
Speaker 1: winter months. But just so it's long term, it's still
Speaker 1: for rising growth, it's still for our outlook that over
Speaker 1: the first half of you will have a vaccine that's
Speaker 1: hopefully widely dissemin it. And I just want to mention,
Speaker 1: forgive me headline crossing the Bloomberg terminal. Uh, this seems
Speaker 1: to be coming from the Wall Street Journal specifically and
Speaker 1: has to do with TikTok, and let me just bring
Speaker 1: it up here again the Commerce Department announcing a stay
Speaker 1: of the TikTok shut down order. So again the Commerce
Speaker 1: Department announcing a stay the TikTok shut down order. So
Speaker 1: basically not looking to necessarily imp who's that specifically, because
Speaker 1: this was kind of a doomsday uh, I guess day
Speaker 1: in terms of potentially what could happen to TikTok. So
Speaker 1: look for a little bit more of a right through
Speaker 1: on that on the Bloomberg. So um getting back to
Speaker 1: the fixed income trade here, Leslie, So where are you
Speaker 1: finding the best opportunities within the market right now, well,
Speaker 1: you knows, as I said, because of the FED backs
Speaker 1: up and by the way, they have a lot of
Speaker 1: dry powder and left right, they have a lot of
Speaker 1: purchasing power. Left you know, they haven't used a lot
Speaker 1: of facilities that they have the ability to use. So
Speaker 1: given the fact that you know how yields investor grade
Speaker 1: corporates have compressed so much to pre COVID levels, we
Speaker 1: like the senior loan side. We'd like to see a
Speaker 1: low side. And for truss one is because we think
Speaker 1: of the floating word, asset is going to be definitely
Speaker 1: value added as we had to twenty twitter one and
Speaker 1: yields rise. And secondarily that as the classes really lad
Speaker 1: but a lot of this liquidity, a lot of some
Speaker 1: of the recovery that we've seen has started to push demand.
Speaker 1: So that's one of the asset class that we like
Speaker 1: in fixed income. Secondarily as well, we also like the
Speaker 1: tips market. You know, we think that break even inflation
Speaker 1: rates will will rise into one We're not expecting, you know,
Speaker 1: large amounts of inflation because there are structural changes that
Speaker 1: are not going away anytime soon, whether it's demographics or technology.
Speaker 1: But we do think inflation expectations should rise as the
Speaker 1: economy reopens and the fence stays out hoold for loose?
Speaker 1: The next one, do you really believe inflation is going
Speaker 1: to start to finally tick higher? Are you just talking
Speaker 1: about from where it's been. I think inflation expectations will
Speaker 1: tip higher, and that's that's the difference. I mean, we
Speaker 1: don't think there's going to be this hyper inflation. But however,
Speaker 1: with that said, I mean the savings rates very high.
Speaker 1: We do think consumer spending will hit greater demand as
Speaker 1: we head into the second farm We are a little
Speaker 1: bit negative on the dollar. I mean, all these aspects
Speaker 1: lead to higher inflation, but not necessarily high inflation. It's
Speaker 1: just that the expectation right now is still fairly low.
Speaker 1: So that's why we like tips as a diversifier. Hey,
Speaker 1: when your team gathers around the virtual table there at UBS,
Speaker 1: I do wonder when you think about a by administration,
Speaker 1: the policies that might come down, whether it's economic policies,
Speaker 1: whether it's tax policies. You know, what are you guys
Speaker 1: thinking that, you know, the policies that might become a
Speaker 1: reality that might impact you know, your university fixed income universe. Well,
Speaker 1: you know when on the six income side. I mean,
Speaker 1: listen what we know and what we saw. We saw
Speaker 1: this on election date when you had this twenty basis
Speaker 1: point turn and in tenure yields, which is the biggest
Speaker 1: voluctility we have seen since Marge, the blue wave and
Speaker 1: the momentum traders that such a blue wave priced in
Speaker 1: with this whole physical stimulus that was large, therefore larger deficits,
Speaker 1: therefore larger more supply into the drudgury market. You saw
Speaker 1: the spike and raids in it reversed. I mean on
Speaker 1: the fixed income side, given the fact we could have
Speaker 1: this divided government, you know, which is expected. You know,
Speaker 1: obviously corporate taxes aren't this bunch of an issue. You know,
Speaker 1: large amounts of supply into the treasure market, although are
Speaker 1: still large, are just gonna be rising by less. So
Speaker 1: therefore you have more of a sort of gradual rising
Speaker 1: interest rates. You have the ability for corporations to spend
Speaker 1: more on kept effects that worry about, you know, tax recality,
Speaker 1: because all these taxes that would have gone through possibly
Speaker 1: the blue wave will sort of be shut down now,
Speaker 1: So it's more of the gridlocks of Goldilocks type of
Speaker 1: scenario in the sense that you know, you get a
Speaker 1: small rise but not a lot of necessarily headwards in
Speaker 1: terms of look things like taxer. So listen, today three
Speaker 1: of the world's top central bankers warned that the prospect
Speaker 1: of a COVID nineteen vaccine is just not enough to
Speaker 1: put an end to the economic challenges created by the pandemic.
Speaker 1: I mean this is Federal Reserve Chief Jerome Powell. We
Speaker 1: also had the Bank of England Governor Andrew Bailey and
Speaker 1: ECB President Christine legarde Um speaking at an event, and
Speaker 1: I mean, listen, we've heard this before from central bankers.
Speaker 1: Do you have faith in global policy makers that they're
Speaker 1: going to get this right? Not global policymakers, I'm talking
Speaker 1: about you know, policymakers, legislators, whether it's our US Congress
Speaker 1: and the equivalent around the world. Well, there's no question
Speaker 1: that it has to come to the fiscal side, and
Speaker 1: we do need more fiscal side. List I mean, you know,
Speaker 1: having follow lower interest rates at the levels that we
Speaker 1: have been added, not going to incrementally make them into
Speaker 1: the difference. Right we have we have a mortgage rate
Speaker 1: at a at a fifty year low, so on the
Speaker 1: consumer side that's creates loring interest rates any further is
Speaker 1: not going to have a huge impact. It really needs
Speaker 1: to come from a fiscal stimulus. And I do believe
Speaker 1: that what the policy makers will do, you know, it's
Speaker 1: not sort of hike too early like they did in
Speaker 1: December of two thousand fifteen. So I think that having
Speaker 1: this lower for longer reason will be the benefit. But
Speaker 1: there's no question that it has to come from the
Speaker 1: fiscal side, because the incrementcial benefit of loring interest rates
Speaker 1: given the level we are right now, is just not
Speaker 1: gonna have no matter that much. Yeah, there's a point
Speaker 1: where I mean it's like, come on, guys, Umm, gonna
Speaker 1: leave it there. Leslie, Thank you so much, Really appreciate it.
Speaker 1: Leslie Focconio. She is senior strategist at UBS Global Wealth Management,
Speaker 1: on the phone from Florida. Thanks so much for listening
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