1
00:00:00,840 --> 00:00:04,000
Speaker 1: Welcome to the Bloomberg Markets Podcast. I'm Paul Sweeney, alongside

2
00:00:04,040 --> 00:00:05,280
Speaker 1: my co host Matt Miller.

3
00:00:05,640 --> 00:00:09,600
Speaker 2: Every business day we bring you interviews from CEOs, market pros,

4
00:00:09,720 --> 00:00:13,600
Speaker 2: and Bloomberg experts, along with essential market moving news.

5
00:00:14,160 --> 00:00:17,279
Speaker 1: Find the Bloomberg Markets podcast called Apple Podcasts or wherever

6
00:00:17,400 --> 00:00:20,520
Speaker 1: you listen to podcasts, and at Bloomberg dot com slash podcast.

7
00:00:20,960 --> 00:00:22,479
Speaker 1: Right now, we're gonna get a little political with you.

8
00:00:22,520 --> 00:00:24,239
Speaker 1: We had that debate last night. So what we're gonna

9
00:00:24,280 --> 00:00:26,400
Speaker 1: do here is we're gonna talk to some smart people.

10
00:00:26,520 --> 00:00:30,639
Speaker 1: Wendy Schiller, professor of Brown Universities joining us here. And

11
00:00:30,680 --> 00:00:32,559
Speaker 1: then at ten thirty we're gonna have that simulcast with

12
00:00:32,560 --> 00:00:36,640
Speaker 1: Bloomberg Television Joe Matthew and Anri Horden interview GOP presidential

13
00:00:36,680 --> 00:00:39,320
Speaker 1: candidate NICKI Haley. So we're gonna go a little politics

14
00:00:39,840 --> 00:00:41,000
Speaker 1: for the next twenty minutes or so.

15
00:00:41,320 --> 00:00:42,959
Speaker 3: Wendy, thanks so much for joining us here.

16
00:00:43,000 --> 00:00:47,360
Speaker 1: We had a debate last night, Sons President Trump, what

17
00:00:47,400 --> 00:00:50,560
Speaker 1: were your takeaways from the Republican candidates?

18
00:00:51,720 --> 00:00:53,960
Speaker 4: Well, I mean, I think some of them did themselves

19
00:00:53,960 --> 00:00:57,640
Speaker 4: some favors. I think Ron DeSantis held his own. Maybe

20
00:00:57,680 --> 00:01:01,120
Speaker 4: he didn't strike a knockout blow against anybody else, but

21
00:01:01,200 --> 00:01:03,880
Speaker 4: I think he showed he was still formidable and wanted

22
00:01:03,880 --> 00:01:04,240
Speaker 4: to fight.

23
00:01:04,560 --> 00:01:06,000
Speaker 5: I think Mike Pence.

24
00:01:05,720 --> 00:01:08,080
Speaker 4: Even though he's got a tough climb, really held his

25
00:01:08,120 --> 00:01:11,160
Speaker 4: own and sort of emphasized his experience. Nikki Haley, whom

26
00:01:11,200 --> 00:01:12,920
Speaker 4: you're going to speak with, I think she had a

27
00:01:12,959 --> 00:01:13,600
Speaker 4: banner night.

28
00:01:14,480 --> 00:01:16,399
Speaker 5: She did not shy away from debate.

29
00:01:16,480 --> 00:01:18,720
Speaker 4: She tried to be more transparent I think about some

30
00:01:18,800 --> 00:01:21,920
Speaker 4: issues like abortion, and she really I think wiped the

31
00:01:22,000 --> 00:01:27,200
Speaker 4: floor with David Bromsway because she indicated that she was,

32
00:01:27,240 --> 00:01:30,279
Speaker 4: of course representative of the UN under Trump, that she knew

33
00:01:30,959 --> 00:01:33,760
Speaker 4: how to navigate international and foreign policy, and that he

34
00:01:33,800 --> 00:01:36,760
Speaker 4: had a very simplistic response to engaging with the world,

35
00:01:37,040 --> 00:01:39,760
Speaker 4: and it just really showcased his inexperience and it really

36
00:01:39,840 --> 00:01:41,760
Speaker 4: highlighted her experience. So I thought that was one of

37
00:01:41,800 --> 00:01:46,160
Speaker 4: her stellar moments throughout the whole debate.

38
00:01:45,360 --> 00:01:50,200
Speaker 2: Abortion, because I know voters have been coming out, as

39
00:01:50,280 --> 00:01:55,360
Speaker 2: evidenced by the recent referendum, I guess it wasn't in

40
00:01:55,440 --> 00:02:00,200
Speaker 2: Ohio when it comes to abortion, and the GEO p

41
00:02:00,560 --> 00:02:05,000
Speaker 2: has typically been more anti abortion or pro life, whereas

42
00:02:05,000 --> 00:02:08,440
Speaker 2: it seems like the majority of the country believes that

43
00:02:08,480 --> 00:02:12,400
Speaker 2: at least in the early stages, a woman should be

44
00:02:12,440 --> 00:02:14,400
Speaker 2: able to decide herself what she wants to do with

45
00:02:14,440 --> 00:02:14,919
Speaker 2: her body.

46
00:02:15,960 --> 00:02:16,160
Speaker 6: Yeah.

47
00:02:16,240 --> 00:02:19,240
Speaker 4: Man, this was really a showcase for people who are

48
00:02:19,240 --> 00:02:22,000
Speaker 4: trying to get the GOP to a place that the

49
00:02:22,000 --> 00:02:24,840
Speaker 4: majority of Americans might agree with, like a fifteen week

50
00:02:24,880 --> 00:02:28,239
Speaker 4: abortion ban. I'm not saying that would, you know, necessarily

51
00:02:28,240 --> 00:02:31,760
Speaker 4: attract a majority position, but Mike Pence had it out there,

52
00:02:32,000 --> 00:02:35,359
Speaker 4: and I think that seems quote unquote reasonable to a

53
00:02:35,400 --> 00:02:38,760
Speaker 4: lot of people, particularly independent voters. So that's a position

54
00:02:39,160 --> 00:02:42,040
Speaker 4: that would not lose the White House. An outright ban

55
00:02:42,240 --> 00:02:44,400
Speaker 4: or a six week ban, I think, given that Roe v.

56
00:02:44,520 --> 00:02:47,560
Speaker 4: Wade has been basically revoked by the Supreme Court, I

57
00:02:47,600 --> 00:02:50,720
Speaker 4: think that's a losing position for the GOP to get

58
00:02:50,720 --> 00:02:52,119
Speaker 4: the White House in twenty twenty four.

59
00:02:52,360 --> 00:02:53,679
Speaker 5: And Nikki Haley understands that.

60
00:02:54,240 --> 00:02:57,079
Speaker 1: Hey, when you talk about Ron DeSantis, you know, one

61
00:02:57,080 --> 00:03:00,720
Speaker 1: point was polling fairly well, but as kind of fallen

62
00:03:00,760 --> 00:03:04,440
Speaker 1: off dramatically. Talk to us about his candidacy to date,

63
00:03:04,480 --> 00:03:05,840
Speaker 1: and particularly about last night.

64
00:03:06,840 --> 00:03:09,200
Speaker 4: Well, I think it shows you the difference between running

65
00:03:09,200 --> 00:03:11,919
Speaker 4: on a national stage and running in Florida. Big state,

66
00:03:12,040 --> 00:03:15,120
Speaker 4: running really well, winning a big campaign, you know, getting

67
00:03:15,120 --> 00:03:18,680
Speaker 4: a lot of national attention, and I think the mismatch

68
00:03:18,800 --> 00:03:21,160
Speaker 4: was in how to run a campaign on the ground

69
00:03:21,200 --> 00:03:24,799
Speaker 4: in this GOP against Donald Trump. He never came out

70
00:03:24,840 --> 00:03:26,160
Speaker 4: really hard against Donald Trump.

71
00:03:26,160 --> 00:03:26,720
Speaker 5: He still won't.

72
00:03:26,760 --> 00:03:28,560
Speaker 4: In fact, it was hard to get an answer from

73
00:03:28,639 --> 00:03:31,280
Speaker 4: him about whether Mike Pence did the right thing and

74
00:03:31,400 --> 00:03:34,120
Speaker 4: ratifying the twenty twenty election last night on the debate stage.

75
00:03:34,280 --> 00:03:35,960
Speaker 4: So I think that was a mistake on his part.

76
00:03:36,000 --> 00:03:38,120
Speaker 4: I mean, I think Trump voters want someone who will

77
00:03:38,120 --> 00:03:40,840
Speaker 4: fight for them. That is constant refrain in the polling

78
00:03:40,880 --> 00:03:43,160
Speaker 4: that we see, and that's what people want to see.

79
00:03:43,200 --> 00:03:45,800
Speaker 5: So Desanta showed up last night as a fighter. But

80
00:03:45,880 --> 00:03:47,440
Speaker 5: the issue is is he more of a fighter than

81
00:03:47,480 --> 00:03:47,960
Speaker 5: Donald Trump?

82
00:03:48,000 --> 00:03:50,000
Speaker 4: And if he's not willing to fight Donald Trump, how

83
00:03:50,000 --> 00:03:51,280
Speaker 4: does he actually illustrate that.

84
00:03:51,240 --> 00:03:52,720
Speaker 7: To the voters in the general?

85
00:03:53,320 --> 00:03:55,640
Speaker 2: I mean, you know, everybody who hasn't followed his career

86
00:03:55,640 --> 00:03:58,000
Speaker 2: closely is just going to know DeSantis for don't say

87
00:03:58,040 --> 00:04:00,920
Speaker 2: gay and you know, trying to fight Mickey Mouse.

88
00:04:02,360 --> 00:04:03,640
Speaker 7: Is that really going to help him?

89
00:04:04,680 --> 00:04:05,000
Speaker 8: Well?

90
00:04:05,080 --> 00:04:09,240
Speaker 4: I think amongst the core, you know, really conservative and

91
00:04:09,360 --> 00:04:13,680
Speaker 4: highly religious wing of the primary elector at the Republican Party,

92
00:04:13,720 --> 00:04:16,480
Speaker 4: which you also saw Senator Tim Scott from South Carolina

93
00:04:16,520 --> 00:04:18,560
Speaker 4: trying to appeal to number of times last night at

94
00:04:18,560 --> 00:04:19,400
Speaker 4: the debate stage.

95
00:04:19,520 --> 00:04:20,880
Speaker 5: That will appeal to them.

96
00:04:21,080 --> 00:04:23,880
Speaker 4: And we've seen the rise of a lot of anti

97
00:04:24,000 --> 00:04:27,640
Speaker 4: gay legislation rhetoric and state legislatures. So in the core

98
00:04:27,839 --> 00:04:31,240
Speaker 4: red states that might help the Santis in the primary process.

99
00:04:31,480 --> 00:04:34,200
Speaker 4: But in some of the bluer or mixed purple states,

100
00:04:34,240 --> 00:04:37,680
Speaker 4: you know, Michigan, Ohio, bigger states in the Republican primary,

101
00:04:37,880 --> 00:04:40,039
Speaker 4: I'm not sure how that plays, and I just don't

102
00:04:40,040 --> 00:04:42,760
Speaker 4: know how far that gets him. And I think his

103
00:04:43,080 --> 00:04:46,000
Speaker 4: challenge is to really show that his poll numbers can

104
00:04:46,040 --> 00:04:48,159
Speaker 4: move up in the next couple of weeks, that they

105
00:04:48,200 --> 00:04:50,560
Speaker 4: can move at all. If you can show that by

106
00:04:50,560 --> 00:04:53,120
Speaker 4: September twenty seventh, the next debate, then I think he

107
00:04:53,200 --> 00:04:55,880
Speaker 4: becomes still the story of being the number.

108
00:04:55,640 --> 00:04:56,400
Speaker 5: Two behind Trump.

109
00:04:56,520 --> 00:04:57,839
Speaker 7: Did Mike Pence?

110
00:04:57,960 --> 00:05:01,000
Speaker 2: You know, I had to get up very early this morning,

111
00:05:01,000 --> 00:05:02,960
Speaker 2: so I went to bed before the debate, but I

112
00:05:03,000 --> 00:05:06,440
Speaker 2: heard there was a question of whether or not each

113
00:05:06,480 --> 00:05:09,080
Speaker 2: candidate would support Donald Trump if he wins the nomination.

114
00:05:09,600 --> 00:05:13,479
Speaker 2: Did Mike Pence raise his hand there? Because you would

115
00:05:13,520 --> 00:05:18,719
Speaker 2: think he would still harbor a little resentment from the

116
00:05:18,760 --> 00:05:20,640
Speaker 2: time that Trump tried to have him lynched.

117
00:05:22,040 --> 00:05:25,800
Speaker 4: He well, he so Mike Pence, I thought, as I said,

118
00:05:25,800 --> 00:05:26,680
Speaker 4: I thought he held.

119
00:05:26,440 --> 00:05:28,120
Speaker 5: His own and better than held his own.

120
00:05:28,200 --> 00:05:30,880
Speaker 4: Last night he was very feisty for Mike Pence from

121
00:05:30,880 --> 00:05:33,839
Speaker 4: what we've seen before, but he sort of hedged on it.

122
00:05:33,880 --> 00:05:35,680
Speaker 4: But what he didn't edge on him was if Trump

123
00:05:35,960 --> 00:05:38,599
Speaker 4: was convicted. That was a weird thing, like, well, you know,

124
00:05:38,640 --> 00:05:42,320
Speaker 4: the question was if Trump is convicted, not indicted, but convicted,

125
00:05:42,600 --> 00:05:45,480
Speaker 4: would you still support him? And most of the nominees

126
00:05:45,520 --> 00:05:48,880
Speaker 4: except for Asa Hutchinson, raised their hand and Mike Christie

127
00:05:48,920 --> 00:05:51,360
Speaker 4: sort of waved his hand and then said, oh, no, no,

128
00:05:51,480 --> 00:05:53,440
Speaker 4: and then Mike Pence kind of raised his hand a

129
00:05:53,480 --> 00:05:55,640
Speaker 4: little bit. But it was not a profile and courage

130
00:05:55,640 --> 00:05:58,160
Speaker 4: for any of the people on that stage. And as

131
00:05:58,200 --> 00:05:59,960
Speaker 4: one of them said to another, if you support the

132
00:06:00,040 --> 00:06:02,720
Speaker 4: rule of law, you know, how can you possibly discount

133
00:06:02,800 --> 00:06:05,080
Speaker 4: this kind of conviction. So this is going to be

134
00:06:05,120 --> 00:06:08,280
Speaker 4: a problem for the Republicans moving forward. I didn't see

135
00:06:08,320 --> 00:06:11,360
Speaker 4: anything last night from most of those candidates that would

136
00:06:11,360 --> 00:06:15,720
Speaker 4: tell me independent voters would choose them over Biden yet

137
00:06:16,080 --> 00:06:18,680
Speaker 4: and I saw some inkling that some of them could

138
00:06:18,720 --> 00:06:21,000
Speaker 4: peel away that group from Biden.

139
00:06:21,040 --> 00:06:22,720
Speaker 1: All right, Wendy, thank you so much for joining us.

140
00:06:22,839 --> 00:06:25,720
Speaker 1: Wendy Schuler, Professor at Brown University. Right now, I want

141
00:06:25,760 --> 00:06:27,840
Speaker 1: to bring in McK mulroy. He's the co founder of

142
00:06:28,000 --> 00:06:31,760
Speaker 1: the Lobo Institute, and he's got a lot of experience

143
00:06:31,800 --> 00:06:34,880
Speaker 1: within the US government, former US Marine Infantry officer, former

144
00:06:34,920 --> 00:06:39,120
Speaker 1: Power Military Operations officer at CIA Hey Nick. Part of

145
00:06:39,320 --> 00:06:42,200
Speaker 1: the debate last night, I was talking about Ukraine. Love

146
00:06:42,279 --> 00:06:45,920
Speaker 1: to get your thoughts to where the Republican Party is

147
00:06:46,080 --> 00:06:48,400
Speaker 1: in its support of Ukraine. Did you learn anything at

148
00:06:48,440 --> 00:06:50,000
Speaker 1: the debate last night, one way or the other?

149
00:06:52,320 --> 00:06:54,960
Speaker 9: So unfortunately I was I was on the news talking

150
00:06:54,960 --> 00:06:58,000
Speaker 9: about precosions, possible demise night.

151
00:06:58,080 --> 00:06:59,599
Speaker 3: Yeah, we want to get your thoughts on that as well.

152
00:07:00,800 --> 00:07:03,520
Speaker 9: Yeah sure, but when it comes to Ukraine. And I

153
00:07:03,560 --> 00:07:07,520
Speaker 9: do stay out of politics altogether, but not on the

154
00:07:07,560 --> 00:07:11,320
Speaker 9: issue of national security. When it comes to Ukraine, I

155
00:07:11,360 --> 00:07:14,680
Speaker 9: think it's important that this adminised, current administration does a

156
00:07:14,720 --> 00:07:18,560
Speaker 9: better job explaining the why we're doing it, not just

157
00:07:18,600 --> 00:07:21,520
Speaker 9: the what. It doesn't do much good just to talk

158
00:07:21,520 --> 00:07:25,120
Speaker 9: about the billions of dollars that are going there. I'm

159
00:07:25,160 --> 00:07:27,480
Speaker 9: not opposed to that at all, but it's more important

160
00:07:27,520 --> 00:07:30,480
Speaker 9: to talk about why. And I think there's plenty of

161
00:07:30,640 --> 00:07:33,880
Speaker 9: Republican candidates that do understand the why, and they are

162
00:07:33,960 --> 00:07:37,640
Speaker 9: explaining it. We have a strong partnership with Ukraine. They

163
00:07:37,640 --> 00:07:41,080
Speaker 9: have been invaded a lawfully by one of our most

164
00:07:41,120 --> 00:07:46,520
Speaker 9: significant adversaries, who, if left unchecked, could easily continue on

165
00:07:46,560 --> 00:07:48,560
Speaker 9: into a NATO country, which would put us at war.

166
00:07:48,640 --> 00:07:52,240
Speaker 9: So I actually just got out of the Churchill War

167
00:07:52,360 --> 00:07:55,880
Speaker 9: Room here in London about an hour before this. And

168
00:07:55,920 --> 00:07:58,080
Speaker 9: if that tells you, if you look at that history

169
00:07:58,080 --> 00:08:00,960
Speaker 9: and how the United States support support AR did England

170
00:08:01,000 --> 00:08:04,160
Speaker 9: during the during that time, I view this very much

171
00:08:04,200 --> 00:08:06,560
Speaker 9: the same. And I hope that everybody that would ever

172
00:08:06,600 --> 00:08:09,240
Speaker 9: seek to be the commander in chief what as well.

173
00:08:09,320 --> 00:08:12,960
Speaker 9: Partners deserve to have partners in times of peace and

174
00:08:13,040 --> 00:08:13,800
Speaker 9: in times of war.

175
00:08:13,920 --> 00:08:16,560
Speaker 2: Well only for so long, right, I mean? President Biden

176
00:08:16,600 --> 00:08:18,720
Speaker 2: showed that no matter what kind of promises we made

177
00:08:18,720 --> 00:08:21,960
Speaker 2: to the Afghani people, we pulled out of there without

178
00:08:22,360 --> 00:08:24,040
Speaker 2: without saving them.

179
00:08:24,440 --> 00:08:26,040
Speaker 7: Do you think that's going to be a problem for

180
00:08:26,160 --> 00:08:27,160
Speaker 7: him in the election.

181
00:08:29,360 --> 00:08:32,439
Speaker 9: The Afghan withdrawal. I absolutely do think that's going to

182
00:08:32,480 --> 00:08:35,480
Speaker 9: be a problem, particularly not that we're a big voting

183
00:08:35,520 --> 00:08:39,680
Speaker 9: block with the Afghan veterans that you know. My position,

184
00:08:39,760 --> 00:08:41,599
Speaker 9: although it doesn't matter much, was that we should have

185
00:08:41,640 --> 00:08:44,960
Speaker 9: left for residual force to maintain what we fought for

186
00:08:44,960 --> 00:08:48,200
Speaker 9: for twenty years. But we certainly shouldn't have not just

187
00:08:48,320 --> 00:08:52,520
Speaker 9: abruptly pulled out and left all of our partners, those

188
00:08:52,559 --> 00:08:56,000
Speaker 9: that fought alongside us for twenty years, to the whim

189
00:08:56,200 --> 00:08:59,920
Speaker 9: of the Taliban. I think that was a national embarrassment,

190
00:09:00,040 --> 00:09:03,640
Speaker 9: and I think most Americans, regardless of the party they're in,

191
00:09:04,160 --> 00:09:05,840
Speaker 9: I agree with that, and I do agree with the

192
00:09:05,840 --> 00:09:08,280
Speaker 9: premiacy of question. I think that's going to cause some

193
00:09:08,320 --> 00:09:11,280
Speaker 9: problems at least as much as foreign policy does play

194
00:09:11,280 --> 00:09:14,360
Speaker 9: into a president election. That is a blight I think

195
00:09:14,440 --> 00:09:15,840
Speaker 9: on this administrative.

196
00:09:15,320 --> 00:09:20,559
Speaker 2: Let's get to what happened in Russia yesterday. Reportedly you

197
00:09:20,600 --> 00:09:23,360
Speaker 2: have get any Pregotion was on a private plane that

198
00:09:23,440 --> 00:09:28,200
Speaker 2: crashed outside of Moscow, And as most commentators have said,

199
00:09:28,240 --> 00:09:30,400
Speaker 2: if that's true, it's not a huge surprise because his

200
00:09:30,559 --> 00:09:37,640
Speaker 2: days were numbered after leading some kind of mutiny against Moscow.

201
00:09:38,240 --> 00:09:39,360
Speaker 7: What's your take on that?

202
00:09:39,440 --> 00:09:42,480
Speaker 2: How does that change the picture for Wagner, for Ukraine

203
00:09:42,720 --> 00:09:45,160
Speaker 2: for Russia.

204
00:09:45,880 --> 00:09:50,199
Speaker 9: So if progosion and apparently Utken and Utkin was actually

205
00:09:50,520 --> 00:09:53,480
Speaker 9: the person who started Wagner his call sign when he

206
00:09:53,559 --> 00:09:57,120
Speaker 9: was in Russian special Forces was Wagner. He was apparently

207
00:09:57,160 --> 00:10:00,760
Speaker 9: on the plane as well. If he is on that plane,

208
00:10:00,760 --> 00:10:03,440
Speaker 9: it looks like the Kremlin may have been trying to

209
00:10:03,440 --> 00:10:07,400
Speaker 9: figure out how do they deal with Wagner post pregosion,

210
00:10:08,040 --> 00:10:11,080
Speaker 9: and apparently, if this is true, they figured it out,

211
00:10:11,200 --> 00:10:15,360
Speaker 9: and that's how that's why this event occurred. They need

212
00:10:15,400 --> 00:10:19,080
Speaker 9: to figure out how to continue operations they find economically

213
00:10:19,160 --> 00:10:22,959
Speaker 9: viable in Africa, for example, without him, and maybe they

214
00:10:22,960 --> 00:10:25,920
Speaker 9: did that, and that is likely in my it's just

215
00:10:26,040 --> 00:10:29,440
Speaker 9: an analysis. I don't have any information specifically on that,

216
00:10:29,640 --> 00:10:32,000
Speaker 9: but why this took so long to happen, all right?

217
00:10:32,080 --> 00:10:34,560
Speaker 9: And I think from all the analysis I've seen, it

218
00:10:34,679 --> 00:10:37,120
Speaker 9: was definitely something that struck the plane that brought it down.

219
00:10:37,160 --> 00:10:38,520
Speaker 1: All right, Mick, thanks so much. We have to run

220
00:10:38,559 --> 00:10:40,160
Speaker 1: just because of the time. Mc morroy, co founder of

221
00:10:40,200 --> 00:10:41,480
Speaker 1: the Lobo Institute.

222
00:10:42,600 --> 00:10:46,000
Speaker 10: You're listening to the Team Ken's are Live program Bloomberg

223
00:10:46,080 --> 00:10:48,359
Speaker 10: Markets weekdays at ten am Eastern.

224
00:10:48,120 --> 00:10:49,480
Speaker 11: On Bloomberg dot Com.

225
00:10:49,520 --> 00:10:52,640
Speaker 10: The iHeartRadio app and the Bloomberg Business app or listen

226
00:10:52,720 --> 00:10:54,800
Speaker 10: on demand wherever you get your podcast.

227
00:10:56,760 --> 00:10:59,520
Speaker 12: Welcome to Bloomberg Television. I'm Ann Recverder and alongside Joe

228
00:10:59,559 --> 00:11:03,080
Speaker 12: Matthew or please to have joining us now the former

229
00:11:03,120 --> 00:11:07,960
Speaker 12: South Carolina governor and u N Ambassador NICKI Haley Ambassador,

230
00:11:08,000 --> 00:11:09,600
Speaker 12: Thank you so much for your time this morning. The

231
00:11:09,600 --> 00:11:12,280
Speaker 12: Wall Street Journal editorial board is leading with this. Most

232
00:11:12,320 --> 00:11:15,319
Speaker 12: GOP voters who aren't in Iowa or New Hampshire are

233
00:11:15,360 --> 00:11:17,920
Speaker 12: only getting to know these candidates, and Miss Haley may

234
00:11:17,960 --> 00:11:20,120
Speaker 12: have been the most pleasant surprise.

235
00:11:20,520 --> 00:11:22,040
Speaker 7: How are you feeling this morning?

236
00:11:22,040 --> 00:11:24,640
Speaker 12: What have your overnight fundraising numbers looked like?

237
00:11:26,720 --> 00:11:28,920
Speaker 13: Well, there's more where that came from. So the Wall

238
00:11:28,960 --> 00:11:31,160
Speaker 13: Street Journal needs to get ready. But you know, it's

239
00:11:31,200 --> 00:11:33,240
Speaker 13: great when you can be on a debate stage and

240
00:11:33,280 --> 00:11:36,360
Speaker 13: allow everybody to see their options for who's going to

241
00:11:36,480 --> 00:11:39,280
Speaker 13: lead the country going forward. I think it's a good time.

242
00:11:39,400 --> 00:11:42,240
Speaker 13: This is the start of the debate season. We think

243
00:11:42,280 --> 00:11:45,080
Speaker 13: we did really well. We're seeing that we're getting support.

244
00:11:45,520 --> 00:11:48,160
Speaker 13: It hasn't stopped since the debate was over last night,

245
00:11:48,240 --> 00:11:50,720
Speaker 13: all the way into this morning, and we welcome it.

246
00:11:50,760 --> 00:11:53,120
Speaker 6: I hope your viewers will go to Nicki Haley dot com.

247
00:11:53,120 --> 00:11:56,200
Speaker 13: But I think what's really important is we have to

248
00:11:56,280 --> 00:11:58,600
Speaker 13: focus on the issues at hand.

249
00:11:59,040 --> 00:12:00,800
Speaker 6: How do we get inflation down.

250
00:12:01,240 --> 00:12:05,280
Speaker 13: Too many families can't afford groceries, they can't afford their rent,

251
00:12:05,320 --> 00:12:09,240
Speaker 13: they can't afford gas, they can't afford childcare. Fifty percent

252
00:12:09,240 --> 00:12:11,840
Speaker 13: of American families can't pay for diapers, and one in

253
00:12:11,960 --> 00:12:15,440
Speaker 13: six American families can't pay their utility bill. And while

254
00:12:15,520 --> 00:12:18,200
Speaker 13: everybody would love to say, oh, Biden did that to us,

255
00:12:18,520 --> 00:12:21,000
Speaker 13: we have to remember our Republicans did that to us

256
00:12:21,080 --> 00:12:24,080
Speaker 13: as well. And that's why I called out Tim Scott

257
00:12:24,120 --> 00:12:27,920
Speaker 13: and Ron Desanis and Mike Pens and Donald Trump for

258
00:12:27,960 --> 00:12:30,480
Speaker 13: the you know, spending like drunken sailors and raising the

259
00:12:30,960 --> 00:12:33,080
Speaker 13: debt limit. I think it's time that we start to

260
00:12:33,120 --> 00:12:35,480
Speaker 13: really make sure we get our fiscal sanity in order.

261
00:12:36,400 --> 00:12:38,040
Speaker 14: Yeah, that was a big moment for you last night,

262
00:12:38,040 --> 00:12:40,440
Speaker 14: calling out not only Democrats but members of your own

263
00:12:40,480 --> 00:12:44,319
Speaker 14: party on that debate stage and here in Washington, Ambassador,

264
00:12:44,640 --> 00:12:47,680
Speaker 14: as you pointed out, specifically, the Trump administration added eight

265
00:12:47,760 --> 00:12:50,360
Speaker 14: trillion dollars to our debts. So let's be specific today

266
00:12:50,400 --> 00:12:53,559
Speaker 14: on Bloomberg, the third rail that nobody wants to touch

267
00:12:54,040 --> 00:12:57,400
Speaker 14: is the entitlement Social Security, Medicare. How would you manage

268
00:12:57,400 --> 00:13:00,800
Speaker 14: the entitlements to try to start getting our arms around

269
00:13:00,800 --> 00:13:01,440
Speaker 14: soaring debt.

270
00:13:03,320 --> 00:13:05,680
Speaker 13: Well, you know, you've got multiple candidates on that stage

271
00:13:05,720 --> 00:13:08,560
Speaker 13: that said they wouldn't touch in titlements, including Trump, And

272
00:13:08,720 --> 00:13:11,280
Speaker 13: any candidate that says they're not going to touch entitlements

273
00:13:11,640 --> 00:13:13,880
Speaker 13: means that they're basically going to go into the go

274
00:13:13,920 --> 00:13:17,640
Speaker 13: into office, and then leave America bankrupt. Social Security is

275
00:13:17,640 --> 00:13:20,080
Speaker 13: going to go bankrupt in ten years, Medicare is going

276
00:13:20,120 --> 00:13:22,040
Speaker 13: to go bankrupt in eight. So the way we deal

277
00:13:22,120 --> 00:13:25,720
Speaker 13: with it is we don't touch anyone's retirement or anyone

278
00:13:25,760 --> 00:13:28,440
Speaker 13: who's been promised in. But we go to people like

279
00:13:28,520 --> 00:13:30,760
Speaker 13: my kids in their twenties when they're coming into the

280
00:13:30,800 --> 00:13:33,520
Speaker 13: system and we say the rules have changed. We change

281
00:13:33,559 --> 00:13:37,280
Speaker 13: retirement age to reflect life expectancy instead of cost of

282
00:13:37,320 --> 00:13:38,160
Speaker 13: living increases.

283
00:13:38,200 --> 00:13:39,560
Speaker 6: We do it based on inflation.

284
00:13:39,960 --> 00:13:43,000
Speaker 13: We limit the benefits on the wealthy, and we expand

285
00:13:43,040 --> 00:13:44,480
Speaker 13: Medicare advantage plans.

286
00:13:45,760 --> 00:13:47,400
Speaker 14: What's the right age there that investador?

287
00:13:48,480 --> 00:13:50,160
Speaker 13: Well, I think we have to do the numbers. We've

288
00:13:50,200 --> 00:13:51,640
Speaker 13: got to figure out what it is. But what we

289
00:13:51,679 --> 00:13:54,400
Speaker 13: do know is sixty five is way too low, and

290
00:13:54,440 --> 00:13:55,600
Speaker 13: we need to increase that.

291
00:13:55,640 --> 00:13:59,040
Speaker 6: We need to do it according to life expectancy.

292
00:13:59,360 --> 00:14:00,000
Speaker 11: You raise your hand.

293
00:14:00,040 --> 00:14:01,800
Speaker 14: And last night, when asked if you would support the

294
00:14:01,840 --> 00:14:04,960
Speaker 14: Republican nominee, of course if that ended up being someone else.

295
00:14:05,000 --> 00:14:07,520
Speaker 14: I know you're running for president here, but if Donald

296
00:14:07,559 --> 00:14:10,480
Speaker 14: Trump was responsible for adding eight trillion dollars to the

297
00:14:10,800 --> 00:14:14,160
Speaker 14: national debt, how could you support him again for another administration?

298
00:14:15,760 --> 00:14:17,640
Speaker 13: Well, first of all, I don't think Donald Trump's going

299
00:14:17,679 --> 00:14:19,440
Speaker 13: to win the nomination. I think I'm going to win

300
00:14:19,480 --> 00:14:22,240
Speaker 13: the nomination. And secondly, I think that we have to

301
00:14:22,240 --> 00:14:25,160
Speaker 13: focus on the fact that anybody is better than a

302
00:14:25,200 --> 00:14:26,480
Speaker 13: president Kamala Harris.

303
00:14:26,560 --> 00:14:27,360
Speaker 6: I mean, you look.

304
00:14:27,200 --> 00:14:30,680
Speaker 13: At the socialism creep that Biden and Harris have gotten

305
00:14:30,760 --> 00:14:33,680
Speaker 13: us into, whether it's the Chips Act, whether it's Inflation

306
00:14:33,840 --> 00:14:36,880
Speaker 13: Reduction Act, whether you see all of these subsidies that

307
00:14:36,920 --> 00:14:39,680
Speaker 13: they are green subsidies that they're doing. They're the ones

308
00:14:39,680 --> 00:14:42,360
Speaker 13: that have left us into a situation where I don't

309
00:14:42,400 --> 00:14:43,160
Speaker 13: think our kids are.

310
00:14:43,120 --> 00:14:44,200
Speaker 6: Going to forgive us for it.

311
00:14:44,520 --> 00:14:47,760
Speaker 13: And so any person on that stage is better than

312
00:14:47,960 --> 00:14:50,280
Speaker 13: Kamala Harris. And I'm going to say that all day long,

313
00:14:50,320 --> 00:14:52,640
Speaker 13: but I think the American people are smart. I don't

314
00:14:52,680 --> 00:14:55,160
Speaker 13: think Donald Trump's going to be the winner of the primary.

315
00:14:55,320 --> 00:14:57,120
Speaker 13: I think I'm going to be the winner of the primary.

316
00:14:57,160 --> 00:14:59,640
Speaker 13: And I think that's why we need a new generational

317
00:15:00,040 --> 00:15:03,160
Speaker 13: conservative leader, because we've got to leave the past and

318
00:15:03,200 --> 00:15:05,680
Speaker 13: the negativity behind us, and we've got to start focusing

319
00:15:05,680 --> 00:15:08,480
Speaker 13: on the real problems at hand and start getting things

320
00:15:08,520 --> 00:15:10,040
Speaker 13: done when.

321
00:15:10,000 --> 00:15:13,360
Speaker 12: Look at the new generation, the most googled individual today,

322
00:15:13,680 --> 00:15:17,720
Speaker 12: Ambassador is Vivek Ramaswami. You took issue as foreign policy

323
00:15:17,800 --> 00:15:20,880
Speaker 12: yesterday as an individual number one googled in America. Who

324
00:15:20,920 --> 00:15:24,440
Speaker 12: wants to give Ukrainian land back to Russia, something that

325
00:15:24,440 --> 00:15:27,720
Speaker 12: actually individuals in the Republican base agree with. Kind of

326
00:15:27,760 --> 00:15:31,400
Speaker 12: taking a playbook from the former president who has called

327
00:15:31,480 --> 00:15:35,000
Speaker 12: what Putin has done in Ukraine genius and savvy. You

328
00:15:35,200 --> 00:15:39,040
Speaker 12: chastise mister Rabiswami yesterday, but you worked for the former president.

329
00:15:39,320 --> 00:15:41,600
Speaker 12: Are both these men wrong when it comes to Russia's

330
00:15:41,640 --> 00:15:42,600
Speaker 12: invasion of Ukraine?

331
00:15:44,640 --> 00:15:47,120
Speaker 13: Well, you know, President Trump used to have it right

332
00:15:47,160 --> 00:15:49,400
Speaker 13: when it came to Russia and Ukraine. He reversed the

333
00:15:49,400 --> 00:15:53,120
Speaker 13: Obama strategy and he sent Javelin missiles to Ukraine and

334
00:15:53,160 --> 00:15:55,520
Speaker 13: I was proud to serve with him. Then he's now

335
00:15:55,600 --> 00:15:58,880
Speaker 13: backtracked now and is going into where he's weaken the

336
00:15:58,960 --> 00:16:02,800
Speaker 13: knees on Russia again. You've got vivid Ramaswami who basically

337
00:16:03,240 --> 00:16:07,480
Speaker 13: wants to side with a murderer over a pro America,

338
00:16:07,600 --> 00:16:11,160
Speaker 13: freedom loving country. That doesn't make sense. You've got Ramaswami

339
00:16:11,160 --> 00:16:14,400
Speaker 13: who wants to cut aid to Israel. He doesn't understand

340
00:16:14,600 --> 00:16:17,640
Speaker 13: that it's not that America needs Israel. It's not that

341
00:16:17,680 --> 00:16:20,920
Speaker 13: Israel needs America. America needs Israel. They're the frontline of

342
00:16:20,920 --> 00:16:24,000
Speaker 13: defense for Iran. He wants to feed Taiwan to China.

343
00:16:24,320 --> 00:16:27,000
Speaker 13: He's missing all the points of You can't be so

344
00:16:27,240 --> 00:16:31,560
Speaker 13: narcissistic to think America doesn't need allies. We do need allies,

345
00:16:31,760 --> 00:16:34,000
Speaker 13: and when you have an ally, you take care of them.

346
00:16:34,280 --> 00:16:37,280
Speaker 13: Everybody's talking about this funding to Ukraine. First of all,

347
00:16:37,280 --> 00:16:41,080
Speaker 13: I think economic aid should come from the Europeans, but equipment,

348
00:16:41,200 --> 00:16:45,640
Speaker 13: military ammunition, we should be sending that. And when we

349
00:16:45,760 --> 00:16:48,320
Speaker 13: send it. Let's keep in mind it is less than

350
00:16:48,360 --> 00:16:50,760
Speaker 13: three and a half percent of our defense budget that

351
00:16:50,800 --> 00:16:53,360
Speaker 13: has gone to Ukraine. If you look at the percentage

352
00:16:53,360 --> 00:16:57,800
Speaker 13: of GDP eleven European countries have paid more than the US,

353
00:16:58,200 --> 00:17:00,840
Speaker 13: but making sure we have to always a win for

354
00:17:00,960 --> 00:17:03,360
Speaker 13: Russia is a win for China, and we can't let

355
00:17:03,400 --> 00:17:03,920
Speaker 13: that happen.

356
00:17:05,000 --> 00:17:06,840
Speaker 12: You're saying Trump did get it right at one point,

357
00:17:06,840 --> 00:17:10,200
Speaker 12: but it was under the Trump administration that withheld millions

358
00:17:10,400 --> 00:17:14,120
Speaker 12: of dollars hundreds of millions to Ukraine that was appropriated

359
00:17:14,160 --> 00:17:18,280
Speaker 12: by Congress. Did they not prepare Kiev well enough for

360
00:17:18,359 --> 00:17:19,200
Speaker 12: this onslaught?

361
00:17:21,240 --> 00:17:21,400
Speaker 9: Well?

362
00:17:21,480 --> 00:17:21,879
Speaker 6: I think that.

363
00:17:21,960 --> 00:17:23,960
Speaker 13: Look, there was a problem with the fact that I

364
00:17:23,960 --> 00:17:27,040
Speaker 13: think Trump had two sets of ammunitions that were supposed

365
00:17:27,040 --> 00:17:30,119
Speaker 13: to go to military equipment and ammunitions that were supposed

366
00:17:30,160 --> 00:17:33,080
Speaker 13: to go to Ukraine before Russia invaded, and Biden pulled

367
00:17:33,119 --> 00:17:35,159
Speaker 13: it because he didn't want to upset Putin.

368
00:17:35,720 --> 00:17:37,400
Speaker 6: This war could have been prevented.

369
00:17:37,560 --> 00:17:40,760
Speaker 13: Biden was slow to the take he didn't act strong enough,

370
00:17:41,040 --> 00:17:43,119
Speaker 13: and that's what happened. And then you go and you

371
00:17:43,160 --> 00:17:44,840
Speaker 13: add the Afghanistan debacle.

372
00:17:45,160 --> 00:17:46,240
Speaker 6: I mean the idea that.

373
00:17:46,160 --> 00:17:49,119
Speaker 13: We left Bagram Air Force Base in the middle of

374
00:17:49,160 --> 00:17:52,240
Speaker 13: the night without telling our allies who stood shoulder to

375
00:17:52,280 --> 00:17:54,800
Speaker 13: shoulder with us for decades because we asked them to

376
00:17:54,800 --> 00:17:58,000
Speaker 13: be there. It was the green light putin needed. It

377
00:17:58,119 --> 00:18:01,560
Speaker 13: was the excitement that pressed she and China got. It's

378
00:18:01,560 --> 00:18:05,840
Speaker 13: why Ron started building a bomb and North Korea started

379
00:18:05,840 --> 00:18:09,359
Speaker 13: testing ballistic missiles. When they see weakness, that's when they

380
00:18:09,440 --> 00:18:12,040
Speaker 13: smell blood in the water, and that's why we saw aggression.

381
00:18:12,280 --> 00:18:16,679
Speaker 13: We need a strong American president who understands what it

382
00:18:16,840 --> 00:18:19,880
Speaker 13: takes to keep Americans safe. And the way you do

383
00:18:19,920 --> 00:18:22,320
Speaker 13: that is you make sure you defeat Russia when it

384
00:18:22,359 --> 00:18:24,760
Speaker 13: comes to Ukraine, because that sends the biggest sign to

385
00:18:24,880 --> 00:18:26,560
Speaker 13: China on not to invade Taiwan.

386
00:18:29,160 --> 00:18:31,480
Speaker 12: The Biden administration at the moment is sending billions of

387
00:18:31,480 --> 00:18:34,160
Speaker 12: dollars to Ukraine. They've also, under their leadership, were able

388
00:18:34,160 --> 00:18:35,760
Speaker 12: to help expand NATO.

389
00:18:36,119 --> 00:18:37,040
Speaker 6: Do you not agree with that?

390
00:18:39,000 --> 00:18:42,840
Speaker 13: I absolutely agree with defending Ukraine, and I agree with

391
00:18:42,880 --> 00:18:45,120
Speaker 13: the fact that we need to expand NATO. I mean,

392
00:18:45,520 --> 00:18:47,960
Speaker 13: it's good to see and I actually think that it

393
00:18:47,960 --> 00:18:50,360
Speaker 13: should go further than that. I think that an invitation

394
00:18:50,800 --> 00:18:53,280
Speaker 13: to NATO should go to Ukraine. They've proven that they're

395
00:18:53,320 --> 00:18:56,680
Speaker 13: good military fighters. And let's keep in mind, Russia has

396
00:18:56,760 --> 00:19:00,680
Speaker 13: never invaded a non NATO country. They've invaded Georgia, they've

397
00:19:00,680 --> 00:19:04,560
Speaker 13: invaded Ukraine, They've invaded Moldova. They don't ever invade a

398
00:19:04,640 --> 00:19:07,320
Speaker 13: non NATO country. So we need to make sure that

399
00:19:07,400 --> 00:19:09,960
Speaker 13: we continue to expand NATO. And we also need to

400
00:19:10,000 --> 00:19:14,880
Speaker 13: work with our other allies India, Australia, Japan, South Korea, Israel.

401
00:19:15,000 --> 00:19:17,320
Speaker 13: We need to start going to the Arab countries. We

402
00:19:17,400 --> 00:19:19,000
Speaker 13: need more friends, not less.

403
00:19:20,040 --> 00:19:22,040
Speaker 14: I have to ask you about an important issue on

404
00:19:22,119 --> 00:19:24,880
Speaker 14: the campaign trail, Ambassador, that loom large over the midterm

405
00:19:24,880 --> 00:19:27,240
Speaker 14: elections and will certainly be top of mind for voters

406
00:19:27,240 --> 00:19:30,960
Speaker 14: Democrats and Republicans in this next election cycle, and that

407
00:19:31,040 --> 00:19:33,400
Speaker 14: is abortion. It came up in the debate last night.

408
00:19:33,920 --> 00:19:37,600
Speaker 14: You've suggested that there are no votes for a national

409
00:19:38,280 --> 00:19:42,400
Speaker 14: abortion ban, or for that matter, a regulatory bill here

410
00:19:42,400 --> 00:19:44,760
Speaker 14: in Washington. You made that point last night, but I

411
00:19:44,800 --> 00:19:47,520
Speaker 14: also I know that your state of South Carolina has

412
00:19:47,560 --> 00:19:51,199
Speaker 14: put in place a six week minimum. Mike Pence and

413
00:19:51,200 --> 00:19:55,719
Speaker 14: some others and the Republican Party are suggesting a national fifteen.

414
00:19:55,440 --> 00:19:57,440
Speaker 7: Week What is your minimum?

415
00:19:57,480 --> 00:19:59,800
Speaker 14: What should be, in fact, the number of weeks for

416
00:19:59,840 --> 00:20:02,240
Speaker 14: this country to coalesce around.

417
00:20:03,160 --> 00:20:07,280
Speaker 13: I am unapologetically pro life, not because the Republican Party

418
00:20:07,320 --> 00:20:09,760
Speaker 13: tells me to be, but because my husband was adopted,

419
00:20:09,800 --> 00:20:12,840
Speaker 13: and I had trouble having both of my children, so

420
00:20:12,880 --> 00:20:14,480
Speaker 13: I am surrounded by blessings.

421
00:20:14,720 --> 00:20:16,600
Speaker 6: Having said that, I don't.

422
00:20:16,400 --> 00:20:18,840
Speaker 13: Judge anyone for being pro choice any more than I

423
00:20:18,880 --> 00:20:20,919
Speaker 13: want them to judge me for being pro life. We

424
00:20:21,000 --> 00:20:25,639
Speaker 13: didn't need unelected justices deciding something this personal and this important,

425
00:20:25,960 --> 00:20:27,840
Speaker 13: So I think it was right to send it back

426
00:20:27,880 --> 00:20:30,119
Speaker 13: to the people to decide. If the people of South

427
00:20:30,160 --> 00:20:33,600
Speaker 13: Carolina chose six weeks, you know, they decided.

428
00:20:33,680 --> 00:20:34,520
Speaker 6: I'm happy with that.

429
00:20:35,080 --> 00:20:37,520
Speaker 13: Other states have chosen other things, but at least the

430
00:20:37,560 --> 00:20:40,840
Speaker 13: people's voices are being heard. The debate that happened last

431
00:20:40,920 --> 00:20:43,840
Speaker 13: night was whether there should be a federal law. And

432
00:20:43,880 --> 00:20:45,880
Speaker 13: I think there is a place for a federal law.

433
00:20:45,960 --> 00:20:48,800
Speaker 13: I think that most Americans, you know. But we have

434
00:20:48,920 --> 00:20:51,119
Speaker 13: to decide. In order to get a federal law, you

435
00:20:51,200 --> 00:20:53,199
Speaker 13: have to win a majority of the House votes, and

436
00:20:53,240 --> 00:20:56,440
Speaker 13: you have to get sixty Senate votes. We have had

437
00:20:56,720 --> 00:20:59,240
Speaker 13: sixty Senate votes on the pro life side in over

438
00:20:59,280 --> 00:21:02,679
Speaker 13: one hundred years. So we need to come together on consensus.

439
00:21:02,720 --> 00:21:05,600
Speaker 13: Where is the consensus. Let's agree that we should ban

440
00:21:05,720 --> 00:21:08,840
Speaker 13: late term abortions. Let's agree that we should encourage more

441
00:21:08,880 --> 00:21:12,560
Speaker 13: adoptions and good quality adoptions. Let's agree that doctors and

442
00:21:12,640 --> 00:21:15,480
Speaker 13: nurses who don't believe in abortions shouldn't have to perform them.

443
00:21:15,760 --> 00:21:19,560
Speaker 13: Let's agree that contraception should be accessible. And let's agree

444
00:21:19,560 --> 00:21:21,639
Speaker 13: that no state law should tell a woman who's had

445
00:21:21,680 --> 00:21:24,280
Speaker 13: an abortion that she's going to jail or she's going

446
00:21:24,320 --> 00:21:25,360
Speaker 13: to get the death penalty.

447
00:21:25,480 --> 00:21:26,520
Speaker 6: Let's start there.

448
00:21:26,600 --> 00:21:29,639
Speaker 13: We have to humanize this situation. I'm not going to

449
00:21:29,640 --> 00:21:32,679
Speaker 13: be a part of demonizing this issue. It's personal for

450
00:21:32,760 --> 00:21:34,760
Speaker 13: everyone and we need to treat it with the respect

451
00:21:34,760 --> 00:21:35,520
Speaker 13: that it deserves.

452
00:21:36,640 --> 00:21:38,920
Speaker 12: And bastard, thank you for sharing some of your also

453
00:21:38,960 --> 00:21:42,160
Speaker 12: personal experience with this. Penn says, every candidate, though, should

454
00:21:42,200 --> 00:21:45,160
Speaker 12: support a banned abortion before fifteen weeks as a minimum

455
00:21:45,240 --> 00:21:46,360
Speaker 12: nationwide standard.

456
00:21:46,720 --> 00:21:52,960
Speaker 6: What is your minimum? First of all, why put women

457
00:21:53,040 --> 00:21:53,440
Speaker 6: through this?

458
00:21:53,520 --> 00:21:55,520
Speaker 13: Why put men through this in a way that they're

459
00:21:55,520 --> 00:21:58,120
Speaker 13: going to hate each other and demonize each other. We

460
00:21:58,240 --> 00:22:01,600
Speaker 13: don't have sixty Senate votes, so where is the consensus?

461
00:22:01,640 --> 00:22:04,000
Speaker 13: We have to figure out what the American.

462
00:22:03,520 --> 00:22:06,920
Speaker 12: Bable want to know from you, as a woman as well,

463
00:22:06,960 --> 00:22:09,040
Speaker 12: where you would stand on this. A lot of cadidates

464
00:22:09,040 --> 00:22:11,160
Speaker 12: have come out and said they're either for six weeks,

465
00:22:11,160 --> 00:22:12,320
Speaker 12: there for fifteen weeks.

466
00:22:12,560 --> 00:22:13,439
Speaker 6: What is your number?

467
00:22:15,040 --> 00:22:17,440
Speaker 13: Well, first of all, I'm for whatever the states decide

468
00:22:17,440 --> 00:22:19,800
Speaker 13: where they are. But I'm also going to tell you

469
00:22:20,000 --> 00:22:23,800
Speaker 13: my job is I'm going to support or promote saving

470
00:22:23,840 --> 00:22:26,639
Speaker 13: as many babies as possible and support as many moms

471
00:22:26,640 --> 00:22:30,000
Speaker 13: as possible. Wherever those sixty Senate votes come down, we're

472
00:22:30,040 --> 00:22:32,520
Speaker 13: going to do it. If you can't get sixty votes,

473
00:22:32,840 --> 00:22:35,520
Speaker 13: you can't save babies. So it's going to require a

474
00:22:35,560 --> 00:22:37,960
Speaker 13: lot of coming together and figuring out where people are.

475
00:22:38,200 --> 00:22:40,639
Speaker 13: But we're not going to divide our country over this issue.

476
00:22:40,640 --> 00:22:42,840
Speaker 13: We're going to bring our country together and where we

477
00:22:42,840 --> 00:22:45,920
Speaker 13: can get sixty votes, that's what we're going to do.

478
00:22:45,920 --> 00:22:48,800
Speaker 14: We have an honest conversation before we let you go, Ambassador,

479
00:22:48,840 --> 00:22:51,080
Speaker 14: about Donald Trump. He chose not to attend the debate

480
00:22:51,160 --> 00:22:54,640
Speaker 14: last night because of his commanding lead in the polls.

481
00:22:54,960 --> 00:22:58,800
Speaker 14: It's difficult to discount the trajectory here. I know you

482
00:22:58,840 --> 00:23:00,720
Speaker 14: don't think that he's going to be then, but he's

483
00:23:00,840 --> 00:23:03,960
Speaker 14: leading the field by anywhere between twenty and forty points

484
00:23:03,960 --> 00:23:05,880
Speaker 14: when you look at the poll. I remember the day

485
00:23:05,880 --> 00:23:08,840
Speaker 14: you endorsed Marco Rubio in the twenty sixteen campaign. You

486
00:23:08,840 --> 00:23:11,240
Speaker 14: said I will not stop until we fight a man

487
00:23:11,280 --> 00:23:14,879
Speaker 14: that chooses not to disavow the KKK referring to Donald Trump.

488
00:23:15,280 --> 00:23:17,119
Speaker 14: That is not a part of our party. That is

489
00:23:17,160 --> 00:23:20,119
Speaker 14: not who we are with. That said, your party seems

490
00:23:20,119 --> 00:23:22,200
Speaker 14: to be in love with Donald Trump. What is your

491
00:23:22,359 --> 00:23:24,200
Speaker 14: path to the nomination?

492
00:23:26,280 --> 00:23:29,399
Speaker 13: Well, look, I was proud to serve in Donald Trump's

493
00:23:29,400 --> 00:23:32,280
Speaker 13: administration and push the foreign policy that we did that

494
00:23:32,320 --> 00:23:34,639
Speaker 13: basically took the kick me sign off of our backs

495
00:23:34,640 --> 00:23:37,960
Speaker 13: at the UN and had America respected again. And I

496
00:23:38,040 --> 00:23:40,520
Speaker 13: support a lot of the policies that he supported. But

497
00:23:40,640 --> 00:23:42,600
Speaker 13: I think that you have to look at the fact

498
00:23:42,600 --> 00:23:44,800
Speaker 13: that three quarters of Americans don't want to see a

499
00:23:44,840 --> 00:23:49,400
Speaker 13: Trump Biden replay. The majority of Americans. I mean, Trump

500
00:23:49,480 --> 00:23:53,680
Speaker 13: is the most disliked politician in America, and the most

501
00:23:53,720 --> 00:23:57,160
Speaker 13: disliked politician in America can't win a general election. So

502
00:23:57,320 --> 00:24:00,280
Speaker 13: this was the kickoff to the debate season, to the

503
00:24:00,320 --> 00:24:02,919
Speaker 13: election season. I think now people are paying attention. I

504
00:24:02,920 --> 00:24:05,960
Speaker 13: think there's a big difference on people who support Trump

505
00:24:06,000 --> 00:24:07,679
Speaker 13: and people who are going to vote for Trump.

506
00:24:07,960 --> 00:24:09,080
Speaker 6: I think people know that.

507
00:24:09,040 --> 00:24:11,879
Speaker 13: We've got new issues, big issues that we need solutions.

508
00:24:11,880 --> 00:24:13,920
Speaker 13: We can't keep looking to the past. We've got to

509
00:24:14,000 --> 00:24:16,760
Speaker 13: lead the drama and negativity to the past. We need

510
00:24:16,800 --> 00:24:20,640
Speaker 13: a new generational conservative leader that's going to focus on

511
00:24:20,720 --> 00:24:23,520
Speaker 13: what it takes to really get America back on track.

512
00:24:23,560 --> 00:24:25,639
Speaker 13: I was a two term governor that took a double

513
00:24:25,640 --> 00:24:28,679
Speaker 13: digit unemployment state and turned it into an economic powerhouse.

514
00:24:29,000 --> 00:24:31,000
Speaker 13: I was at the un I didn't deal with one country.

515
00:24:31,040 --> 00:24:33,119
Speaker 13: I dealt with one hundred and ninety three. I'm not

516
00:24:33,240 --> 00:24:35,480
Speaker 13: a lawyer, I'm gonna accountant. I think it's time that

517
00:24:35,520 --> 00:24:38,840
Speaker 13: we get our fiscal house in order, close our border,

518
00:24:39,119 --> 00:24:41,480
Speaker 13: make sure we have law and order, get transparency in

519
00:24:41,520 --> 00:24:43,840
Speaker 13: the schools, and have a national security that will keep

520
00:24:43,880 --> 00:24:44,880
Speaker 13: American safe.

521
00:24:45,800 --> 00:24:48,040
Speaker 14: She's fresh off the debate station with us here on

522
00:24:48,080 --> 00:24:51,280
Speaker 14: Bloomberg former governor, former Ambassador Nikki Haley. We thank you

523
00:24:51,320 --> 00:24:52,920
Speaker 14: for the time this morning on Bloomberg.

524
00:24:52,880 --> 00:24:55,520
Speaker 10: If you're listening to the tape, catch our live program

525
00:24:55,560 --> 00:24:59,960
Speaker 10: Bloomberg Markets weekdays at ten am Eastern on Bloomberg Radio,

526
00:25:00,440 --> 00:25:01,840
Speaker 10: Bloomberg dot Com.

527
00:25:01,600 --> 00:25:03,040
Speaker 11: And the Bloomberg Business App.

528
00:25:03,080 --> 00:25:05,879
Speaker 10: You can also listen live on Amazon Alexa from our

529
00:25:05,920 --> 00:25:10,960
Speaker 10: flagship New York station, Just say Alexa play Bloomberg eleven thirty.

530
00:25:11,720 --> 00:25:14,359
Speaker 1: All right, let's talk about the stock of the day,

531
00:25:14,440 --> 00:25:16,800
Speaker 1: and really the week and maybe a year to date.

532
00:25:16,960 --> 00:25:20,520
Speaker 1: In Vidia, little chip maker, all time high today it's

533
00:25:20,600 --> 00:25:21,639
Speaker 1: up one point three percent.

534
00:25:22,160 --> 00:25:23,320
Speaker 3: Just extraordinary story.

535
00:25:23,720 --> 00:25:26,119
Speaker 1: Let's talk to somebody who does his chip stuff for

536
00:25:26,119 --> 00:25:28,959
Speaker 1: a living, Kun John Sabani. He is the lead at

537
00:25:28,960 --> 00:25:32,119
Speaker 1: Semiconductor Analys. He doesn't follow anybody. He's the lead semiconductor

538
00:25:32,119 --> 00:25:34,879
Speaker 1: analys for Bloomberg Intelligence. I meant I did not hire

539
00:25:34,920 --> 00:25:38,120
Speaker 1: this guy, so let's see how he does though. Okay, scoo, John,

540
00:25:38,119 --> 00:25:39,000
Speaker 1: thanks so much for joining us.

541
00:25:39,000 --> 00:25:39,399
Speaker 3: Appreciate it.

542
00:25:39,440 --> 00:25:41,720
Speaker 1: He joins us via zoom in San Francisco. He says,

543
00:25:41,720 --> 00:25:46,680
Speaker 1: so cow guy undergrad USC Business School UCLA. I don't

544
00:25:46,720 --> 00:25:49,520
Speaker 1: know where his loyalties lie between those two schools. But

545
00:25:50,119 --> 00:25:53,720
Speaker 1: in Nvidiakujohn, talk to us about the quarter we had yesterday.

546
00:25:54,040 --> 00:25:56,720
Speaker 3: Just monster monster revenue.

547
00:25:56,400 --> 00:25:56,720
Speaker 11: Right.

548
00:25:58,119 --> 00:26:01,040
Speaker 15: All right, I mean it was not a big surprise

549
00:26:01,119 --> 00:26:02,720
Speaker 15: to us, at least it was in line with our

550
00:26:02,920 --> 00:26:07,680
Speaker 15: preview call. Yet again they delivered a blockbuster quarter. Most

551
00:26:07,720 --> 00:26:10,400
Speaker 15: of the upside, again was primarily given by their Data

552
00:26:10,480 --> 00:26:13,679
Speaker 15: center segment, which are their GPUs that go in all

553
00:26:13,720 --> 00:26:17,000
Speaker 15: the data centers and primarily used for AI these days,

554
00:26:17,200 --> 00:26:20,080
Speaker 15: so it was more of a function of them able

555
00:26:20,080 --> 00:26:22,720
Speaker 15: to get a lot more supply because the demand has

556
00:26:22,800 --> 00:26:26,000
Speaker 15: been rising and is running ahead of the supply, and

557
00:26:26,040 --> 00:26:30,040
Speaker 15: we expect similar growth to continue because again there's a

558
00:26:30,080 --> 00:26:32,080
Speaker 15: lot of signals that demand continues to rise.

559
00:26:32,800 --> 00:26:33,240
Speaker 7: Kunjan.

560
00:26:33,800 --> 00:26:38,800
Speaker 2: When in Vidia put in an order right because they

561
00:26:38,800 --> 00:26:41,280
Speaker 2: don't make their own chips, so they go to TSMC

562
00:26:41,600 --> 00:26:48,639
Speaker 2: and they say we want this many GPUs. Does TSMC say, well,

563
00:26:48,760 --> 00:26:52,159
Speaker 2: you know, get in line everybody wants these things, or

564
00:26:52,760 --> 00:26:55,760
Speaker 2: does Nvidia get to step to the head of the line.

565
00:26:57,080 --> 00:27:01,040
Speaker 15: I mean Avidia does have garnered a lot of high power. Look,

566
00:27:01,119 --> 00:27:03,880
Speaker 15: they're the number one player when it comes to GPU

567
00:27:04,080 --> 00:27:07,040
Speaker 15: and they've been getting the growing the most fastest, so

568
00:27:07,080 --> 00:27:09,680
Speaker 15: they do have a lot of pull. But it's not

569
00:27:09,760 --> 00:27:12,479
Speaker 15: just a function of getting lined. When you have growth

570
00:27:12,600 --> 00:27:14,600
Speaker 15: like this, it has not I've not seen I've been

571
00:27:14,640 --> 00:27:16,480
Speaker 15: in an industry for twenty years and I've not seen

572
00:27:16,520 --> 00:27:19,720
Speaker 15: such beats in the twenty years. So it's not just

573
00:27:19,800 --> 00:27:22,800
Speaker 15: easy to just bring up supply because it's not sitting somewhere.

574
00:27:22,840 --> 00:27:26,800
Speaker 15: These are leading edge nodes products, and especially the supply

575
00:27:26,880 --> 00:27:29,480
Speaker 15: crunches at the packaging side, because these are most advanced

576
00:27:29,560 --> 00:27:32,880
Speaker 15: packaging and the supply just didn't exist. So suddenly when

577
00:27:32,880 --> 00:27:35,400
Speaker 15: you go and say I need double than what I expected,

578
00:27:35,800 --> 00:27:37,720
Speaker 15: it takes time to bring up supply. So it's not

579
00:27:37,760 --> 00:27:40,280
Speaker 15: a function of ESMC not putting them back in the

580
00:27:40,320 --> 00:27:42,879
Speaker 15: Queue's just it takes time to bring up that supply.

581
00:27:43,200 --> 00:27:46,240
Speaker 8: Hey, Kunja, this is Barry Ritolts, and I'm looking at

582
00:27:46,280 --> 00:27:48,760
Speaker 8: this chart. A year to date, we're up two hundred

583
00:27:48,800 --> 00:27:52,640
Speaker 8: and twenty two percent in video raises the question how

584
00:27:52,720 --> 00:27:55,920
Speaker 8: much of the upside is priced in already?

585
00:27:57,680 --> 00:27:59,960
Speaker 15: I mean, coming into this quarter, there were a lot

586
00:27:59,960 --> 00:28:03,200
Speaker 15: of concerns exactly about that point. But look, we think

587
00:28:03,560 --> 00:28:08,520
Speaker 15: this another blockbuster print and raise should ease some of

588
00:28:08,560 --> 00:28:12,240
Speaker 15: those concerns because there's definitely less doubt when it comes

589
00:28:12,280 --> 00:28:16,359
Speaker 15: to sustainability of the demand. And like you saw, you know,

590
00:28:16,640 --> 00:28:19,679
Speaker 15: we've seen market reactions similar to last quarter. It's helping

591
00:28:19,800 --> 00:28:22,680
Speaker 15: boost another sort of rally to the AI exposed names.

592
00:28:23,720 --> 00:28:26,520
Speaker 2: In terms of the other chips, does it matter, does

593
00:28:26,560 --> 00:28:29,200
Speaker 2: it matter what they make for PCs? Does it matter

594
00:28:29,280 --> 00:28:31,119
Speaker 2: what they make for card, does it matter what they

595
00:28:31,160 --> 00:28:31,800
Speaker 2: make for phone?

596
00:28:33,160 --> 00:28:35,920
Speaker 15: I mean, overall for the company does matter, But right

597
00:28:35,960 --> 00:28:39,920
Speaker 15: now people are only focused about data center because that's really.

598
00:28:39,960 --> 00:28:42,320
Speaker 15: I mean it's become close to seventy percent or more

599
00:28:42,320 --> 00:28:45,360
Speaker 15: of the revenue. So that's what really people are focusing

600
00:28:45,400 --> 00:28:45,960
Speaker 15: on right now.

601
00:28:46,160 --> 00:28:49,760
Speaker 1: All right, So how about like AMD, Intel, Broadcom, Qualcom.

602
00:28:50,000 --> 00:28:53,200
Speaker 1: Were those guys in terms of I don't know just.

603
00:28:53,160 --> 00:28:56,360
Speaker 3: Their AI ness if you will, their exposure to AI.

604
00:28:56,760 --> 00:28:58,200
Speaker 3: How do you think about those companies?

605
00:28:59,600 --> 00:29:02,640
Speaker 15: I mean, this is the largest and the fastest growing

606
00:29:02,920 --> 00:29:05,160
Speaker 15: opportunity that we have seen in a long while in

607
00:29:05,200 --> 00:29:08,720
Speaker 15: the semi world. So everyone is trying to get get

608
00:29:08,760 --> 00:29:11,480
Speaker 15: a bite on the this large piece of the pie.

609
00:29:11,520 --> 00:29:14,840
Speaker 15: Now you know, they are all playing catch up, and

610
00:29:14,920 --> 00:29:18,960
Speaker 15: Media was the leader. We think there's definitely opportunity for

611
00:29:20,440 --> 00:29:23,840
Speaker 15: some other names like AMD, Broadcom to some degree Intel

612
00:29:24,160 --> 00:29:27,360
Speaker 15: to grab a small sliver of this pie, which against

613
00:29:27,520 --> 00:29:30,040
Speaker 15: even though it's a small percentage of the total market share,

614
00:29:30,160 --> 00:29:33,520
Speaker 15: adds to your tapline in terms of billions of dollars.

615
00:29:33,640 --> 00:29:35,800
Speaker 15: So they're all playing catch up. They should all still

616
00:29:35,920 --> 00:29:38,360
Speaker 15: see the benefits of it. But we believe and it

617
00:29:38,400 --> 00:29:41,520
Speaker 15: comes to GPU and accelerators and VIDIA will be the

618
00:29:41,520 --> 00:29:42,160
Speaker 15: dominant share.

619
00:29:42,240 --> 00:29:44,120
Speaker 2: I mean, but Kunjan, if you look at a pie

620
00:29:45,280 --> 00:29:50,680
Speaker 2: chart and it's you know, GPUs in server center today.

621
00:29:50,880 --> 00:29:54,560
Speaker 2: Not GPUs that they you know, have designed, Not GPUs

622
00:29:54,600 --> 00:29:56,720
Speaker 2: that they have for sale and maybe a customer is

623
00:29:56,720 --> 00:30:00,400
Speaker 2: going to buy, but GPUs that are already in the

624
00:30:00,440 --> 00:30:06,600
Speaker 2: big server centers. How much of that pie is Nvidia?

625
00:30:06,760 --> 00:30:08,040
Speaker 15: Oh gosh in like.

626
00:30:10,680 --> 00:30:11,400
Speaker 10: So huge?

627
00:30:11,440 --> 00:30:16,000
Speaker 8: So that is very reminiscent of Tesla. A decade ago,

628
00:30:16,280 --> 00:30:19,200
Speaker 8: all we heard was, hey, this is an up and

629
00:30:19,280 --> 00:30:22,520
Speaker 8: comer and they have a huge lead and it's gonna take.

630
00:30:22,400 --> 00:30:25,240
Speaker 2: Forever for people to catch up. It's still Tesla's world.

631
00:30:25,280 --> 00:30:29,800
Speaker 2: Everybody else is just paying rent. As Dan ives, I'm

632
00:30:29,840 --> 00:30:30,280
Speaker 2: not so.

633
00:30:30,200 --> 00:30:31,680
Speaker 7: Sure that's the case anymore.

634
00:30:31,800 --> 00:30:35,120
Speaker 8: They used to have the market all to themselves. You

635
00:30:35,200 --> 00:30:38,680
Speaker 8: can't say that anymore. There are credible competitors to Tesla.

636
00:30:39,240 --> 00:30:43,080
Speaker 8: That wasn't true five years ago. So the parallel I'm

637
00:30:43,080 --> 00:30:47,120
Speaker 8: trying to raise is it's in Vidia's world, everybody else

638
00:30:47,200 --> 00:30:49,400
Speaker 8: is living in it. How long is that going to

639
00:30:49,520 --> 00:30:53,880
Speaker 8: last for you don't have the same consumer loyalty issues

640
00:30:53,920 --> 00:30:56,880
Speaker 8: that have been driving Tesla. This is just who could

641
00:30:56,960 --> 00:31:00,360
Speaker 8: produce the most GPUs for the least cost. That's going

642
00:31:00,440 --> 00:31:04,120
Speaker 8: to be who's winning huge head start. When might other

643
00:31:04,200 --> 00:31:08,680
Speaker 8: companies begin to make a dent in that massive unsustainable

644
00:31:09,120 --> 00:31:11,440
Speaker 8: ninety plus percent market Tunjohn, what do you think?

645
00:31:12,840 --> 00:31:15,920
Speaker 15: I mean, Look, you're correct, there's definitely going to be

646
00:31:16,000 --> 00:31:19,080
Speaker 15: some dent, but we don't see it in the near term.

647
00:31:19,520 --> 00:31:22,520
Speaker 15: I mean worst case. You can think of what we've

648
00:31:22,520 --> 00:31:24,880
Speaker 15: seen numbers or what we think right the ninety five

649
00:31:24,960 --> 00:31:27,880
Speaker 15: share could go as low as like eighty five eighty

650
00:31:28,360 --> 00:31:31,080
Speaker 15: in the next maybe three or four five years, but

651
00:31:31,200 --> 00:31:33,400
Speaker 15: that's still huge. One thing you have to remember is

652
00:31:33,880 --> 00:31:36,400
Speaker 15: they are not even able to ship to the entire

653
00:31:36,560 --> 00:31:38,720
Speaker 15: orders they have, like even after such a high beat.

654
00:31:38,760 --> 00:31:41,440
Speaker 15: What we're hearing from customers is they can't get enough

655
00:31:41,520 --> 00:31:44,560
Speaker 15: Nvidia chips and they are not willing to go to

656
00:31:44,640 --> 00:31:47,840
Speaker 15: another chip maker right now that we cannot get Nvidia,

657
00:31:48,000 --> 00:31:50,520
Speaker 15: let's go and buy something else. They still are waiting

658
00:31:50,680 --> 00:31:52,520
Speaker 15: to get the Nvidia chips and solutions.

659
00:31:52,720 --> 00:31:54,840
Speaker 1: All right, what's the I don't know, I'm gonna say,

660
00:31:54,920 --> 00:31:57,280
Speaker 1: not gonna say the barecase from Vidio, But what's maybe

661
00:31:57,320 --> 00:31:59,560
Speaker 1: a headwind out there that maybe the market's not paying

662
00:31:59,560 --> 00:32:00,440
Speaker 1: them enoughing tention too?

663
00:32:00,480 --> 00:32:01,080
Speaker 3: Do you think.

664
00:32:02,960 --> 00:32:07,000
Speaker 15: One risk factor is definitely China, which people are paying

665
00:32:07,040 --> 00:32:10,760
Speaker 15: attention because, you know, any more incremental sanctions in this

666
00:32:10,840 --> 00:32:13,200
Speaker 15: area because the AI area comes under a lot of

667
00:32:13,240 --> 00:32:17,520
Speaker 15: focus when you think about US China trade sanctions they have,

668
00:32:17,640 --> 00:32:21,120
Speaker 15: they're already sanctioned last year from not allowing them aligned

669
00:32:21,160 --> 00:32:23,760
Speaker 15: selling their highest generationship.

670
00:32:23,040 --> 00:32:23,840
Speaker 11: To the China.

671
00:32:23,920 --> 00:32:26,680
Speaker 15: And look outside of the US, the largest cloud supply

672
00:32:27,040 --> 00:32:30,360
Speaker 15: service providers are in China, So that could be, you know,

673
00:32:30,440 --> 00:32:33,520
Speaker 15: in the case of really restrictive sanctions, that could be

674
00:32:33,600 --> 00:32:36,880
Speaker 15: that could limit that upside, that could limit their TAM opportunity.

675
00:32:37,240 --> 00:32:39,120
Speaker 15: So that's one of the risk cases right now.

676
00:32:41,160 --> 00:32:46,200
Speaker 8: Really really quite fascinating. Other than other than AI, is

677
00:32:46,240 --> 00:32:49,560
Speaker 8: there any other field than in Nvidia sort of the

678
00:32:49,600 --> 00:32:53,360
Speaker 8: way Qualcom took over mobile. Is there any other potential

679
00:32:53,480 --> 00:32:56,760
Speaker 8: use case for Nvidia chips or is this an AI

680
00:32:57,000 --> 00:32:57,720
Speaker 8: story only?

681
00:32:59,240 --> 00:33:02,080
Speaker 15: Well, there's definitely. The other up and coming market for

682
00:33:02,120 --> 00:33:06,400
Speaker 15: them is automotive. Look, everyone's aware cars are becoming sort

683
00:33:06,400 --> 00:33:10,600
Speaker 15: of computer running on wheels, as we go to autonomous driving,

684
00:33:10,640 --> 00:33:15,280
Speaker 15: as we get a higher penetration of evs. There's really

685
00:33:15,320 --> 00:33:18,520
Speaker 15: three key players when it comes to computed cars, and

686
00:33:18,520 --> 00:33:20,280
Speaker 15: then media is one of them.

687
00:33:20,760 --> 00:33:22,719
Speaker 1: All right, cu John, thanks so much for joining us.

688
00:33:22,720 --> 00:33:26,040
Speaker 1: Really appreciate getting your thoughts. John, Sohani he is the

689
00:33:26,120 --> 00:33:29,600
Speaker 1: lead semiconductor animals for Bloomberg Intelligency's based out there in

690
00:33:29,680 --> 00:33:33,520
Speaker 1: our San Francisco officer right smack in the middle of

691
00:33:33,160 --> 00:33:35,880
Speaker 1: the Silicon Valley and all the tech speak out there,

692
00:33:35,920 --> 00:33:38,560
Speaker 1: so giving us his thoughts on Nvidia and again just

693
00:33:38,640 --> 00:33:41,680
Speaker 1: a monster beat and raise again.

694
00:33:43,120 --> 00:33:46,960
Speaker 10: You're listening to the team can't live program Bloomberg Markets

695
00:33:47,000 --> 00:33:48,920
Speaker 10: weekdays at ten am Eastern.

696
00:33:48,640 --> 00:33:51,680
Speaker 11: On Bloomberg dot Com, the iHeartRadio.

697
00:33:50,960 --> 00:33:53,719
Speaker 10: App and the Bloomberg Business App, or listen on demand

698
00:33:53,760 --> 00:33:55,280
Speaker 10: wherever you get your podcast.

699
00:33:57,320 --> 00:33:59,120
Speaker 1: Matt Miller, Paul Sweeney joining in live here on a

700
00:33:59,160 --> 00:34:02,680
Speaker 1: Bloomberg Interactive Chris Studio. We're joined with Battery, Ridholtz, Ridholts

701
00:34:02,720 --> 00:34:06,400
Speaker 1: Wealth Management joining us here for a spell here, and

702
00:34:06,480 --> 00:34:10,200
Speaker 1: we're also on that YouTube thing. Boeing shares a Boeing

703
00:34:10,440 --> 00:34:14,239
Speaker 1: and its biggest supplier, Spirit Arrow Systems Holdings, fell after

704
00:34:14,280 --> 00:34:18,400
Speaker 1: the planemaker disclosed improperly drilled holes in a component that

705
00:34:18,440 --> 00:34:23,279
Speaker 1: helps maintain cabinet pressure within the seven three seven Max jet.

706
00:34:23,320 --> 00:34:26,040
Speaker 3: Here we go again. George Ferguson he joins us.

707
00:34:26,040 --> 00:34:28,719
Speaker 1: He covers all the aerospace stuff for Bloomberg Intelligence.

708
00:34:29,320 --> 00:34:31,080
Speaker 3: He is a veteran of the.

709
00:34:31,040 --> 00:34:33,480
Speaker 1: US Army so we thank him for his service, but

710
00:34:33,520 --> 00:34:35,919
Speaker 1: of course the highlight of his career was the four

711
00:34:35,960 --> 00:34:39,720
Speaker 1: years he spent at Penn State cheering on the Nitly Lions. George,

712
00:34:40,160 --> 00:34:42,600
Speaker 1: we love Boeing. It's a great, great American company.

713
00:34:42,960 --> 00:34:45,280
Speaker 3: What's going on? How serious is this latest issue?

714
00:34:46,840 --> 00:34:50,399
Speaker 16: So first, thanks as always for having me on. So, yeah,

715
00:34:50,440 --> 00:34:52,920
Speaker 16: the you know, Boeing has said that there's no safety

716
00:34:52,920 --> 00:34:56,440
Speaker 16: of flight issues for these these holes that were sort

717
00:34:56,480 --> 00:34:59,560
Speaker 16: of misdrilled in the rear pressure bulkhead.

718
00:35:00,239 --> 00:35:03,120
Speaker 17: I mean, so I think in the story that's the positive.

719
00:35:03,880 --> 00:35:07,360
Speaker 16: The challenge here is the challenge we've been seeing all year,

720
00:35:08,239 --> 00:35:12,400
Speaker 16: multiple years, right, it's really quality controlled down at the suppliers.

721
00:35:12,440 --> 00:35:16,640
Speaker 16: The supplier bases have really gone through a lot of

722
00:35:16,680 --> 00:35:22,279
Speaker 16: turnover employees since the pandemic, and that just keeps biting them, right,

723
00:35:22,320 --> 00:35:25,840
Speaker 16: and so again another story. We don't know full numbers

724
00:35:25,840 --> 00:35:27,799
Speaker 16: on what it's going to cost to repair. The great

725
00:35:27,800 --> 00:35:29,640
Speaker 16: news is we don't have to bring everything in from

726
00:35:29,640 --> 00:35:32,239
Speaker 16: out of the fleet right away to repair it. My

727
00:35:32,360 --> 00:35:36,840
Speaker 16: guess is that they'll worry about maybe crack propagation over time,

728
00:35:37,400 --> 00:35:39,759
Speaker 16: you know, as you do more takeoffs and landings on

729
00:35:39,840 --> 00:35:43,200
Speaker 16: an airframe. So that probably required some level of inspection.

730
00:35:43,760 --> 00:35:45,839
Speaker 16: It may slow down deliveries this year as they try

731
00:35:45,840 --> 00:35:48,919
Speaker 16: to fix what they have going through the processes right

732
00:35:48,960 --> 00:35:51,279
Speaker 16: now before they get into the fleet and don't need

733
00:35:51,320 --> 00:35:54,800
Speaker 16: to do the extra inspection later on. So it probably

734
00:35:54,800 --> 00:35:58,720
Speaker 16: puts some of Boeing's deliveries at risk this year. We'll

735
00:35:58,760 --> 00:36:00,839
Speaker 16: wait to hear what they've got to say. And again

736
00:36:00,880 --> 00:36:03,160
Speaker 16: the good news is I'm not gonna spend a lot

737
00:36:03,160 --> 00:36:05,160
Speaker 16: of money bring everything in from out of the fleet.

738
00:36:05,520 --> 00:36:07,200
Speaker 17: But again the challenge here.

739
00:36:07,120 --> 00:36:11,400
Speaker 16: Is supplier you know, is supplier skill set, supplier stability.

740
00:36:12,000 --> 00:36:15,520
Speaker 8: Hey, George Barry Ridholts. So you're you're touching on exactly

741
00:36:15,520 --> 00:36:18,640
Speaker 8: where he wanted to go. Which is is this just

742
00:36:18,680 --> 00:36:22,799
Speaker 8: a freakish one off or is there a larger problem

743
00:36:23,040 --> 00:36:27,319
Speaker 8: with process? How does something like this happen? How is

744
00:36:27,320 --> 00:36:30,960
Speaker 8: it not caught sooner? And what does it mean for

745
00:36:31,239 --> 00:36:33,960
Speaker 8: all the rest of the systems we don't know anything about.

746
00:36:34,760 --> 00:36:37,319
Speaker 16: Yeah, well, look I think there's a I think the

747
00:36:37,360 --> 00:36:42,320
Speaker 16: good news is on aircraft builds there it's very robust

748
00:36:42,360 --> 00:36:44,320
Speaker 16: and so there is some tolerance.

749
00:36:43,880 --> 00:36:45,280
Speaker 17: For everything not being perfect.

750
00:36:45,880 --> 00:36:48,759
Speaker 16: You clearly want to be it perfect right so that

751
00:36:49,120 --> 00:36:51,680
Speaker 16: you can minimize any risks as you build an airframe.

752
00:36:52,120 --> 00:36:55,360
Speaker 16: But I think Barry, we've gotten way past the one off.

753
00:36:55,760 --> 00:36:58,960
Speaker 16: There's been so many problems coming out of the supplier

754
00:36:59,000 --> 00:37:03,240
Speaker 16: base see Spirit, where I think you have to concern

755
00:37:03,280 --> 00:37:06,200
Speaker 16: yourself now with process, right. I think Boeing really needs

756
00:37:06,239 --> 00:37:09,200
Speaker 16: to get in there and figure out why Spirit can't

757
00:37:09,239 --> 00:37:14,680
Speaker 16: get the you know, these really critical manufacturing processes standardized

758
00:37:14,719 --> 00:37:18,000
Speaker 16: and stabilize, so they're coming through the factory correct the

759
00:37:18,040 --> 00:37:18,560
Speaker 16: first time.

760
00:37:19,480 --> 00:37:23,640
Speaker 8: Is this specific to the seven thirty seven or might

761
00:37:23,680 --> 00:37:27,920
Speaker 8: this be a broader problem that affects everything that comes

762
00:37:27,960 --> 00:37:29,640
Speaker 8: out with a Boeing logo on it.

763
00:37:30,640 --> 00:37:34,320
Speaker 16: So the seven thirty seven and the rear pressure bulkhead

764
00:37:34,360 --> 00:37:38,320
Speaker 16: would be built at Spirit, and no other Bowing airplane

765
00:37:38,320 --> 00:37:41,319
Speaker 16: would have that rear pressure bulkhead done its Spirit. So

766
00:37:41,800 --> 00:37:44,919
Speaker 16: I'm guessing this is going to be largely a seven

767
00:37:45,080 --> 00:37:48,479
Speaker 16: thirty seven issue. I mean, maybe the seven sixty seven

768
00:37:48,800 --> 00:37:51,640
Speaker 16: seven six seven runs through Spirit as well, but we

769
00:37:51,680 --> 00:37:52,520
Speaker 16: haven't heard anything about it.

770
00:37:52,520 --> 00:37:54,520
Speaker 17: It's low volume two. I'm guessing it's going to be

771
00:37:54,640 --> 00:37:57,280
Speaker 17: largely seven thirty seven issue right now.

772
00:37:57,600 --> 00:38:01,080
Speaker 1: Georgia, you also cover a Spirit aerosystem stock is down

773
00:38:01,120 --> 00:38:03,960
Speaker 1: fifteen percent on the news today, it's off thirty four

774
00:38:04,000 --> 00:38:06,239
Speaker 1: percent year to date. Most of us don't know anything

775
00:38:06,239 --> 00:38:09,080
Speaker 1: about Spirit Aero Systems. Tell us who they are, what

776
00:38:09,160 --> 00:38:11,719
Speaker 1: they do, and does this come as a surprise to you.

777
00:38:12,760 --> 00:38:15,320
Speaker 16: Yeah, So they make a lot of fuselage pieces for Boeing.

778
00:38:15,960 --> 00:38:18,360
Speaker 16: They make I think it's something like about seventy percent

779
00:38:18,480 --> 00:38:22,520
Speaker 16: of the seven thirty seven aircraft, so they're really integral

780
00:38:22,560 --> 00:38:25,320
Speaker 16: to that airplane. Spirit was spun out of Boeing a

781
00:38:25,400 --> 00:38:29,840
Speaker 16: bunch of decades ago. You know that it's a Wichita factory.

782
00:38:29,840 --> 00:38:33,120
Speaker 16: I think that Boeing probably wanted to get outside of

783
00:38:33,160 --> 00:38:34,960
Speaker 16: the main company so they could save a little bit

784
00:38:34,960 --> 00:38:39,560
Speaker 16: of money on labor. Again, it doesn't surprise me because

785
00:38:39,600 --> 00:38:43,960
Speaker 16: we've seen other problems at Spirit recently in processes.

786
00:38:44,719 --> 00:38:44,960
Speaker 17: You know.

787
00:38:45,320 --> 00:38:47,200
Speaker 16: One of the things I think very telling about how

788
00:38:47,200 --> 00:38:50,840
Speaker 16: important Spirit is to Boeing is i'd call Spirit somewhat

789
00:38:51,000 --> 00:38:56,640
Speaker 16: challenge from a financial standpoint. They've recently received advances from Boeing,

790
00:38:57,560 --> 00:39:00,200
Speaker 16: you know, to support some of their cash flow. We

791
00:39:00,239 --> 00:39:03,120
Speaker 16: saw them go into the markets, but I think it

792
00:39:03,120 --> 00:39:06,279
Speaker 16: was last year or early this year, actually early this year,

793
00:39:06,680 --> 00:39:09,279
Speaker 16: and they raised some bonds at over nine percent, which

794
00:39:09,280 --> 00:39:11,839
Speaker 16: I think is really difficult for a supplier to kind

795
00:39:11,840 --> 00:39:14,680
Speaker 16: of support that kind of that kind of that kind

796
00:39:14,719 --> 00:39:17,560
Speaker 16: of debt costs. But then Boeing has put money into

797
00:39:17,560 --> 00:39:20,280
Speaker 16: the supplier because they are so important to Boeing.

798
00:39:20,280 --> 00:39:21,480
Speaker 17: And I think part of.

799
00:39:21,400 --> 00:39:24,160
Speaker 16: This story is going to be I think the market's

800
00:39:24,200 --> 00:39:27,080
Speaker 16: telling you they think Spirit's going to be responsible and

801
00:39:27,200 --> 00:39:30,319
Speaker 16: ultimately have to pay for these repairs. Right Boeing would

802
00:39:30,320 --> 00:39:32,919
Speaker 16: try to recoup it from them, but Spirit only has

803
00:39:33,000 --> 00:39:37,040
Speaker 16: so much capability to pay for those, you know, for

804
00:39:37,080 --> 00:39:39,680
Speaker 16: the cost of these problems, And so it's going to

805
00:39:39,719 --> 00:39:42,960
Speaker 16: be interesting to watch Boeing as they work with Spirit

806
00:39:43,000 --> 00:39:45,520
Speaker 16: to figure out a repayment plan in some of this stuff.

807
00:39:45,560 --> 00:39:49,440
Speaker 2: George just got about thirty seconds here, but Boeing seems

808
00:39:49,480 --> 00:39:52,080
Speaker 2: to be beset with issues on the seven thirty seven,

809
00:39:52,160 --> 00:39:55,239
Speaker 2: even though Paul trusted more than any other plane. Is

810
00:39:55,280 --> 00:39:59,600
Speaker 2: the Airbus A three twenty just a better platform.

811
00:39:59,120 --> 00:40:01,200
Speaker 16: You know, I wouldn't call it a better platform, but

812
00:40:01,239 --> 00:40:03,960
Speaker 16: I think the Airbus does have more stability in the

813
00:40:04,000 --> 00:40:06,480
Speaker 16: builds of that They do more of it in the house,

814
00:40:07,160 --> 00:40:09,080
Speaker 16: and that's going to lead to higher build rates for

815
00:40:09,239 --> 00:40:11,120
Speaker 16: Airbus and better profitability.

816
00:40:11,320 --> 00:40:14,359
Speaker 17: So something that Boeing absolutely has this come out all right?

817
00:40:14,400 --> 00:40:15,759
Speaker 3: George, thanks so much for joining us.

818
00:40:15,960 --> 00:40:19,120
Speaker 1: As always, George Ferguson, He's the senior Aerospace, Defense and

819
00:40:19,160 --> 00:40:22,959
Speaker 1: Airline analyst for Bloomberg Intelligence. And as it relates to Bowing,

820
00:40:22,960 --> 00:40:25,160
Speaker 1: I'm going to go back to my personal opinion. They

821
00:40:25,280 --> 00:40:28,360
Speaker 1: never should have up left Seattle. They are Seattle. Seattle

822
00:40:28,440 --> 00:40:30,520
Speaker 1: is Boeing. One of the great drives in from an

823
00:40:30,520 --> 00:40:32,959
Speaker 1: airport to a downtown is Seattle. You come down whatever

824
00:40:33,000 --> 00:40:35,440
Speaker 1: that interstate is. It's a thirty minute ride roughly, and

825
00:40:35,440 --> 00:40:37,840
Speaker 1: almost the entire ride on the left of the interstate

826
00:40:37,960 --> 00:40:39,759
Speaker 1: is Boeing hangars.

827
00:40:39,440 --> 00:40:42,960
Speaker 3: Airfields, jets taking off. I mean, it's just the engineering

828
00:40:43,000 --> 00:40:45,400
Speaker 3: gut of the company. So what do you do? You

829
00:40:45,520 --> 00:40:49,160
Speaker 3: move to Chicago and now Washington, DC. This is Bloomberg.

830
00:40:49,400 --> 00:40:53,040
Speaker 10: You're listening to the tape cansur live program Bloomberg Markets

831
00:40:53,080 --> 00:40:56,479
Speaker 10: weekdays at ten am Eastern on Bloomberg Radio, the tune

832
00:40:56,520 --> 00:40:58,279
Speaker 10: in app, Bloomberg dot Com.

833
00:40:58,040 --> 00:40:59,439
Speaker 11: And the Bloomberg Business App.

834
00:40:59,480 --> 00:41:02,319
Speaker 10: You can also listen live on Amazon Alexa from our

835
00:41:02,360 --> 00:41:07,239
Speaker 10: flagship New York station Just Say Alexa, playing Bloomberg eleven.

836
00:41:08,200 --> 00:41:10,040
Speaker 3: Jordan Lopez joins as he does this stuff for a

837
00:41:10,080 --> 00:41:10,560
Speaker 3: living as.

838
00:41:10,440 --> 00:41:13,920
Speaker 1: A director and high yield portfolio manager at Payton and Regal.

839
00:41:14,160 --> 00:41:16,399
Speaker 1: Jordan talked to us about the high yield market this year.

840
00:41:16,440 --> 00:41:18,400
Speaker 1: How's it it been. It looks like it's outperforming, it

841
00:41:18,400 --> 00:41:20,640
Speaker 1: looks like it's the place to be. It looks like

842
00:41:21,280 --> 00:41:23,120
Speaker 1: they're not too worried about a recession.

843
00:41:23,600 --> 00:41:23,960
Speaker 3: Yeah.

844
00:41:24,160 --> 00:41:25,880
Speaker 18: I think that's been the story of the year. I

845
00:41:26,160 --> 00:41:28,720
Speaker 18: think coming into the year, you know, the the base

846
00:41:28,800 --> 00:41:34,439
Speaker 18: case expectation was for recession, and we're really seeing few

847
00:41:34,520 --> 00:41:38,760
Speaker 18: signs of a recession, which which is really keeping default

848
00:41:38,800 --> 00:41:42,000
Speaker 18: forecast low. So so if you look at you know,

849
00:41:42,040 --> 00:41:47,160
Speaker 18: both macro data on the employment side or the growth side,

850
00:41:47,160 --> 00:41:50,160
Speaker 18: they're both coming in much stronger than expected. And then

851
00:41:50,160 --> 00:41:52,439
Speaker 18: when we look at earnings, you know, earnings have been

852
00:41:52,560 --> 00:41:55,799
Speaker 18: very resilient. So when you take a step back and

853
00:41:55,840 --> 00:41:59,719
Speaker 18: look at the big picture, I think, you know, some

854
00:41:59,760 --> 00:42:03,680
Speaker 18: of these Dractconian default expectations just aren't coming to fruition.

855
00:42:04,239 --> 00:42:06,719
Speaker 18: Uh And and that's really what's what's driven at at

856
00:42:06,800 --> 00:42:08,600
Speaker 18: least the the rallying spreads.

857
00:42:09,239 --> 00:42:11,880
Speaker 8: So that's exactly where I was going to go. You know,

858
00:42:12,000 --> 00:42:14,200
Speaker 8: high yield look at look at a fund like HyG

859
00:42:14,880 --> 00:42:18,960
Speaker 8: you're getting five point three percent investment grade corporate not

860
00:42:19,040 --> 00:42:19,520
Speaker 8: getting a.

861
00:42:19,440 --> 00:42:20,240
Speaker 3: Whole lot less.

862
00:42:20,640 --> 00:42:23,040
Speaker 8: Why do I want to go out on the risk

863
00:42:23,880 --> 00:42:28,200
Speaker 8: scale and embrace high yield over investment grade corporates.

864
00:42:29,120 --> 00:42:31,040
Speaker 18: Well, when you when you look at the broader market,

865
00:42:31,239 --> 00:42:34,759
Speaker 18: the yields are closer to you know, mid to high

866
00:42:34,880 --> 00:42:38,320
Speaker 18: eight percent, and so there is still a decent pickup.

867
00:42:38,840 --> 00:42:42,240
Speaker 18: And like I said, if you're if your default expectations

868
00:42:42,239 --> 00:42:45,000
Speaker 18: aren't much, you are still getting paid to go out.

869
00:42:46,120 --> 00:42:46,759
Speaker 11: When when we.

870
00:42:46,800 --> 00:42:50,760
Speaker 18: Look at the high yield market itself, you know, credit

871
00:42:50,800 --> 00:42:54,200
Speaker 18: metrics are still very very strong. They are certainly coming

872
00:42:54,239 --> 00:42:58,319
Speaker 18: off of what we're all time highs. But you know,

873
00:42:58,400 --> 00:43:01,320
Speaker 18: when when you look at something like interest coverage ratio

874
00:43:01,800 --> 00:43:05,320
Speaker 18: or or a company's ability to service their debt, it's

875
00:43:05,400 --> 00:43:11,120
Speaker 18: still very very well above historical averages. So even if

876
00:43:11,120 --> 00:43:15,479
Speaker 18: we are to have some sort of recession, we think

877
00:43:15,520 --> 00:43:18,200
Speaker 18: that that you know, most of the companies within the

878
00:43:18,239 --> 00:43:20,759
Speaker 18: high yield space should be able to manage that, and

879
00:43:20,800 --> 00:43:24,480
Speaker 18: therefore you are getting paid above something like investment grade.

880
00:43:25,239 --> 00:43:26,760
Speaker 3: What sectors do you like out there?

881
00:43:27,320 --> 00:43:29,040
Speaker 1: I've had a lot of experience in the highield space

882
00:43:29,080 --> 00:43:32,120
Speaker 1: and the media, telecom space, and boy, the hyold market

883
00:43:32,600 --> 00:43:33,640
Speaker 1: loves that those companies.

884
00:43:33,640 --> 00:43:34,760
Speaker 3: Where are you guys looking.

885
00:43:34,640 --> 00:43:35,759
Speaker 7: Well, are you still going?

886
00:43:35,960 --> 00:43:38,319
Speaker 2: I mean, hasn't high yield done so well that it's

887
00:43:38,360 --> 00:43:40,160
Speaker 2: outrageously expensive at this point?

888
00:43:41,680 --> 00:43:41,719
Speaker 15: No?

889
00:43:42,040 --> 00:43:48,000
Speaker 18: You know, spreads are still slightly above historical averages, and

890
00:43:48,000 --> 00:43:51,400
Speaker 18: and you know, back to the conversation about which sectors

891
00:43:51,400 --> 00:43:54,600
Speaker 18: we like, media and cable will actually have some of

892
00:43:54,640 --> 00:43:57,319
Speaker 18: the more problematic companies in the in the space right now.

893
00:43:57,800 --> 00:44:02,600
Speaker 18: Surprisingly enough, what people don't really appreciate about the market

894
00:44:02,800 --> 00:44:07,600
Speaker 18: is the energy companies have done exceptionally well. I know,

895
00:44:07,640 --> 00:44:09,520
Speaker 18: they were kind of the black sheep of the market

896
00:44:09,560 --> 00:44:13,920
Speaker 18: back in twenty fifteen early twenty sixteen. But when we

897
00:44:13,960 --> 00:44:16,960
Speaker 18: look at a lot of those companies now, a lot

898
00:44:17,040 --> 00:44:20,640
Speaker 18: of them actually have investment grade credit metrics, and for

899
00:44:21,000 --> 00:44:22,880
Speaker 18: many of them, we just think it's a matter of

900
00:44:22,920 --> 00:44:27,800
Speaker 18: time before they get upgraded to investment grade. So although

901
00:44:27,840 --> 00:44:30,600
Speaker 18: that space trade is tight relative to the market, we

902
00:44:30,680 --> 00:44:34,640
Speaker 18: still think there are several opportunities there for further spread compression.

903
00:44:35,800 --> 00:44:38,520
Speaker 1: All right, So I'm looking here, so is it a

904
00:44:38,560 --> 00:44:42,960
Speaker 1: sense of this high yield market is feeling pretty good

905
00:44:42,960 --> 00:44:46,600
Speaker 1: about the economy that they're maybe just not pricing in

906
00:44:46,640 --> 00:44:49,719
Speaker 1: that risk at this point, or do you really still

907
00:44:49,760 --> 00:44:50,560
Speaker 1: have to be careful here.

908
00:44:52,280 --> 00:44:54,400
Speaker 18: I think where you have to be careful is the

909
00:44:54,480 --> 00:44:58,560
Speaker 18: companies you choose. So certainly there is going to be

910
00:44:58,600 --> 00:45:01,640
Speaker 18: some dispersion. There are going to be winners and losers.

911
00:45:02,680 --> 00:45:05,960
Speaker 18: But if if you're able to do your your credit work,

912
00:45:06,360 --> 00:45:09,120
Speaker 18: you know, you can still find plenty of opportunities out

913
00:45:09,120 --> 00:45:13,160
Speaker 18: there where you get paid a healthy yield and you

914
00:45:13,200 --> 00:45:15,640
Speaker 18: can sleep well at night owning a lot of these companies.

915
00:45:16,680 --> 00:45:18,640
Speaker 1: How about the in the in the media space, I'm

916
00:45:18,680 --> 00:45:21,560
Speaker 1: gonna go back to my Baileywick here, having punched out

917
00:45:21,600 --> 00:45:22,120
Speaker 1: a bunch.

918
00:45:21,880 --> 00:45:24,680
Speaker 3: Of these over the years, that's tough sector right now.

919
00:45:24,800 --> 00:45:29,640
Speaker 1: Advertising headwinds potentially here all the cord cutting issues, and

920
00:45:29,680 --> 00:45:31,320
Speaker 1: there's a lot of cable debt out there, there's a

921
00:45:31,320 --> 00:45:32,600
Speaker 1: lot of broadcasting debt out there.

922
00:45:33,080 --> 00:45:35,080
Speaker 3: What's your feeling on the broader media space.

923
00:45:36,320 --> 00:45:39,160
Speaker 18: Yeah, it's certainly been one of the most challenged spaces,

924
00:45:39,239 --> 00:45:43,279
Speaker 18: and from a fundamental standpoint, you're you're absolutely right, uh,

925
00:45:43,320 --> 00:45:47,240
Speaker 18: there there have been a lot of slowing of growth

926
00:45:48,200 --> 00:45:51,440
Speaker 18: in some of the you know, uh, some of some

927
00:45:51,520 --> 00:45:56,080
Speaker 18: of the cable operators. It is challenged, but you know,

928
00:45:56,120 --> 00:45:58,520
Speaker 18: when when you look at valuations, a lot of that's

929
00:45:58,560 --> 00:46:01,919
Speaker 18: already priced in that that's one area where you do

930
00:46:01,960 --> 00:46:06,319
Speaker 18: see more distressed type of companies. And so from a

931
00:46:06,360 --> 00:46:10,600
Speaker 18: fundamental standpoint, that's a tough story, but that is being

932
00:46:10,640 --> 00:46:15,200
Speaker 18: reflected in the overall spreads of the market. And again,

933
00:46:15,360 --> 00:46:18,080
Speaker 18: you know, like anything else, there will be winners and

934
00:46:18,080 --> 00:46:20,799
Speaker 18: losers coming out of that space, and there will be

935
00:46:20,840 --> 00:46:21,919
Speaker 18: some opportunities there.

936
00:46:22,280 --> 00:46:23,719
Speaker 3: All right, Jordan, thanks so much.

937
00:46:23,880 --> 00:46:26,680
Speaker 1: Jordan Lopez a director and high yield portfolio manager for

938
00:46:26,760 --> 00:46:29,320
Speaker 1: Paydon and Regal. I think it's interesting there that the

939
00:46:29,400 --> 00:46:33,480
Speaker 1: highyield market doing really well in front of what everybody's

940
00:46:33,520 --> 00:46:35,760
Speaker 1: been talking about for the last twelve months of recession.

941
00:46:35,840 --> 00:46:38,800
Speaker 8: Yeah, you could get about three hundred basis points, That's

942
00:46:38,800 --> 00:46:41,719
Speaker 8: what Jowan was talking about. But you're you're looking at

943
00:46:42,480 --> 00:46:45,640
Speaker 8: B grade companies. You're not even looking at double B.

944
00:46:45,760 --> 00:46:47,919
Speaker 8: You're looking at So do you what.

945
00:46:47,800 --> 00:46:49,279
Speaker 3: Do you do with high yielded with your clients? Do

946
00:46:49,280 --> 00:46:51,120
Speaker 3: you have anything in there? Not a whole lot?

947
00:46:51,280 --> 00:46:54,360
Speaker 8: You know, up until very recently, you weren't. First of all,

948
00:46:55,200 --> 00:46:58,080
Speaker 8: go back a year and a half, the spread between

949
00:46:58,480 --> 00:47:02,640
Speaker 8: investment grade and high yield was so tiny and the

950
00:47:02,680 --> 00:47:06,239
Speaker 8: returns were so pitiful. You know, who cares about the

951
00:47:06,239 --> 00:47:09,000
Speaker 8: difference between one and three quarters and two and a

952
00:47:09,040 --> 00:47:11,600
Speaker 8: quarter percent if you have to go out on the curve.

953
00:47:11,640 --> 00:47:15,279
Speaker 8: It's amazing how far everything has spread out. But keep

954
00:47:15,280 --> 00:47:18,160
Speaker 8: in mind, if you want to want a safe investment,

955
00:47:18,280 --> 00:47:20,800
Speaker 8: the ten year is well over four percent.

956
00:47:21,280 --> 00:47:23,960
Speaker 7: You could do okay without taking a lot of risk.

957
00:47:24,400 --> 00:47:27,200
Speaker 2: Yeah, I mean you can buy the twos and get

958
00:47:27,239 --> 00:47:28,400
Speaker 2: five right.

959
00:47:28,520 --> 00:47:31,440
Speaker 8: They're the risk is whether or not we run into

960
00:47:31,520 --> 00:47:35,000
Speaker 8: a rake cuts or a recession in the next year.

961
00:47:35,080 --> 00:47:36,759
Speaker 2: Yeah, but you're still getting five percent, so you don't

962
00:47:36,760 --> 00:47:38,000
Speaker 2: have to do anything except for let them be.

963
00:47:38,000 --> 00:47:38,600
Speaker 7: Sure if you want to.

964
00:47:38,880 --> 00:47:42,520
Speaker 2: Yeah, I guess's and frankly, yep, twenties you get four

965
00:47:42,520 --> 00:47:42,799
Speaker 2: and a half.

966
00:47:42,800 --> 00:47:43,080
Speaker 7: All right?

967
00:47:43,080 --> 00:47:45,120
Speaker 1: That was Jordan Lopez, director and High Yeld Portfolio Matter

968
00:47:45,200 --> 00:47:47,640
Speaker 1: Paydon and Regal helping us out with the High Yield space.

969
00:47:48,239 --> 00:47:51,360
Speaker 10: You're listening to the tape catch are live program Bloomberg

970
00:47:51,400 --> 00:47:55,000
Speaker 10: Markets weekdays at ten am Eastern on Bloomberg Radio, the

971
00:47:55,040 --> 00:47:57,160
Speaker 10: tune in app, Bloomberg dot Com.

972
00:47:56,840 --> 00:47:58,279
Speaker 11: And the Bloomberg Business app.

973
00:47:58,320 --> 00:48:01,000
Speaker 10: You can also listen live on was on Alexa from

974
00:48:01,000 --> 00:48:04,799
Speaker 10: our flagship New York Station. Just say Alexa play Bloomberg

975
00:48:04,800 --> 00:48:05,560
Speaker 10: eleven thirty.

976
00:48:06,960 --> 00:48:09,560
Speaker 2: Matt Miller here in the studio with Paul Sweeney and

977
00:48:09,760 --> 00:48:12,239
Speaker 2: Barry Ritholds, and we have a special guest. We were

978
00:48:12,239 --> 00:48:15,399
Speaker 2: talking about Hannah Elliott earlier from Bloomberg Pursuits. We've got

979
00:48:15,440 --> 00:48:19,799
Speaker 2: her on the cam from Los Angeles. Hannah, thanks so

980
00:48:19,880 --> 00:48:23,080
Speaker 2: much for joining us. I wanted to talk about the

981
00:48:23,760 --> 00:48:27,279
Speaker 2: car that I was driving last week, which is I

982
00:48:27,320 --> 00:48:33,719
Speaker 2: think widely controversial, and that's the BMW x M. It's

983
00:48:33,760 --> 00:48:36,879
Speaker 2: supposedly it's a dedicated M car and they haven't done

984
00:48:36,920 --> 00:48:39,200
Speaker 2: one of those since the M one, And this means

985
00:48:39,239 --> 00:48:42,479
Speaker 2: basically their speed shop, you know, their skunk works unit

986
00:48:43,280 --> 00:48:46,200
Speaker 2: is making this, and they're not gonna have a regular

987
00:48:46,320 --> 00:48:51,000
Speaker 2: kind of street version of it. But they detuned the

988
00:48:51,160 --> 00:48:53,920
Speaker 2: four point four leader twin turbo V eight to be

989
00:48:54,040 --> 00:48:57,560
Speaker 2: less powerful than it is in the X five M,

990
00:48:57,880 --> 00:49:02,160
Speaker 2: and there's no air suspension and a lot of people

991
00:49:02,160 --> 00:49:04,440
Speaker 2: think it's kind of ugly. And first I want to

992
00:49:04,440 --> 00:49:05,920
Speaker 2: get your take on it. What do you think about

993
00:49:05,920 --> 00:49:07,760
Speaker 2: this big behemoth of a hybrid.

994
00:49:09,040 --> 00:49:13,000
Speaker 19: Well, I have to say BMW is making us work

995
00:49:13,160 --> 00:49:16,520
Speaker 19: really hard to really like them these days. And I

996
00:49:16,560 --> 00:49:23,640
Speaker 19: don't really understand why. I do agree that they're styling choices,

997
00:49:24,000 --> 00:49:26,640
Speaker 19: and the choices they're making with their engines and power

998
00:49:26,640 --> 00:49:30,799
Speaker 19: plants right now are a little bit confusing and even puzzling.

999
00:49:31,880 --> 00:49:34,440
Speaker 19: I have to say, my disclaimer is I haven't driven

1000
00:49:34,480 --> 00:49:36,840
Speaker 19: this vehicle, so I can't speak to that. But I

1001
00:49:36,880 --> 00:49:41,120
Speaker 19: have driven the IX, which is the electric version, which

1002
00:49:41,160 --> 00:49:45,920
Speaker 19: I thought was very capable but unfortunately didn't look great.

1003
00:49:46,120 --> 00:49:48,480
Speaker 19: It sounds like you felt a little bit the same

1004
00:49:48,520 --> 00:49:49,800
Speaker 19: way about this one, Matt.

1005
00:49:49,719 --> 00:49:52,360
Speaker 2: Yeah, this so this is we're looking at pictures of

1006
00:49:52,400 --> 00:49:54,840
Speaker 2: it now. For those of you only listening, you go

1007
00:49:54,840 --> 00:49:57,640
Speaker 2: to YouTube dot com. You can stream us live by

1008
00:49:57,680 --> 00:50:01,560
Speaker 2: searching for Bloomberg Radio there. I mean, I personally like

1009
00:50:01,640 --> 00:50:07,440
Speaker 2: it because it's so big and aggressive, but I think,

1010
00:50:07,680 --> 00:50:10,920
Speaker 2: first of all, it's way overpriced one hundred and sixty

1011
00:50:11,000 --> 00:50:15,919
Speaker 2: seven thousand dollars for a car that doesn't even get

1012
00:50:15,960 --> 00:50:19,080
Speaker 2: the sunroof option. I could understand if they're saying, like,

1013
00:50:19,440 --> 00:50:21,759
Speaker 2: because it's a track car, you know, we want the

1014
00:50:21,800 --> 00:50:27,160
Speaker 2: stiffness and the low low weight of just the flat roof.

1015
00:50:27,320 --> 00:50:32,560
Speaker 2: But why then D two the V eight and there's

1016
00:50:32,600 --> 00:50:36,080
Speaker 2: no air ride suspension, so It's not like a luxury

1017
00:50:36,320 --> 00:50:38,840
Speaker 2: suv for you know, the well heeled. It's not like

1018
00:50:38,840 --> 00:50:42,120
Speaker 2: a Kardashian mobile. So I just don't really get what

1019
00:50:42,160 --> 00:50:45,000
Speaker 2: they're doing with it. And Barry, I love I'm a

1020
00:50:45,080 --> 00:50:47,120
Speaker 2: huge fan of the brand, and I know you are too.

1021
00:50:47,480 --> 00:50:50,319
Speaker 8: Yeah, I'm gonna I'm gonna give this car a sort

1022
00:50:50,320 --> 00:50:55,560
Speaker 8: of backhanded compliment. This is the least ugly new BMW

1023
00:50:55,680 --> 00:50:59,399
Speaker 8: in a couple of years, maybe because the I don't

1024
00:50:59,400 --> 00:51:02,560
Speaker 8: know what the thing with those giant grills that are

1025
00:51:02,600 --> 00:51:05,919
Speaker 8: on the three and four series are just horrific, and

1026
00:51:06,040 --> 00:51:09,160
Speaker 8: some of the choices that have been made. I understand

1027
00:51:09,200 --> 00:51:11,919
Speaker 8: you want the electric vehicles to have a different look,

1028
00:51:12,320 --> 00:51:16,840
Speaker 8: and so they went for something that was a little

1029
00:51:17,000 --> 00:51:20,120
Speaker 8: less rounded, let's say, than some of their other stuff.

1030
00:51:20,480 --> 00:51:22,840
Speaker 8: This isn't a terrible looking car. I don't have a

1031
00:51:22,880 --> 00:51:27,680
Speaker 8: problem with no air suspension. They're notoriously quirky. They break,

1032
00:51:27,719 --> 00:51:29,080
Speaker 8: and they're really expensive to repair.

1033
00:51:29,120 --> 00:51:30,880
Speaker 7: One hundred and sixty seven grand.

1034
00:51:31,960 --> 00:51:36,000
Speaker 8: That's a whole different question, Hannah can answer. What are

1035
00:51:36,000 --> 00:51:40,920
Speaker 8: they thinking? Who are they competing with with the exam.

1036
00:51:40,680 --> 00:51:42,920
Speaker 19: You know what, This seems to me like a case

1037
00:51:42,960 --> 00:51:45,799
Speaker 19: of we're gonna price it. Again, we're gonna price it

1038
00:51:46,200 --> 00:51:48,840
Speaker 19: compared to the people that we think we're competing against,

1039
00:51:48,920 --> 00:51:52,080
Speaker 19: which is probably Portia and Mercedes. But the price is

1040
00:51:52,080 --> 00:51:55,600
Speaker 19: a bit aspirational, like BMW is hoping that the price

1041
00:51:55,719 --> 00:51:58,799
Speaker 19: means that they're competitive with those other vehicles, but I

1042
00:51:58,920 --> 00:52:01,640
Speaker 19: just don't think the product is. And when you can

1043
00:52:01,680 --> 00:52:06,520
Speaker 19: get a Cayenne for less than that, again, I think

1044
00:52:06,560 --> 00:52:12,920
Speaker 19: you're absolutely right. The price does seem wildly inappropriate.

1045
00:52:13,040 --> 00:52:16,680
Speaker 3: Well, k I learn the GTS or the turbo. What

1046
00:52:16,719 --> 00:52:17,360
Speaker 3: are you getting from that?

1047
00:52:17,520 --> 00:52:19,680
Speaker 7: You can get the Cayenne Turbo for less than one second?

1048
00:52:19,680 --> 00:52:20,160
Speaker 7: Oh really?

1049
00:52:20,320 --> 00:52:21,000
Speaker 3: Yeah for sure?

1050
00:52:21,040 --> 00:52:24,680
Speaker 2: And this goes up against the Cayenne Turbo Hybrid, and

1051
00:52:24,719 --> 00:52:26,400
Speaker 2: I think you're right, that's what they want.

1052
00:52:26,520 --> 00:52:28,920
Speaker 7: But you can't beat that car tough.

1053
00:52:28,840 --> 00:52:31,480
Speaker 19: Right, That's that's the thing. Just because you make your

1054
00:52:31,520 --> 00:52:35,160
Speaker 19: price the same as another company's product doesn't mean your

1055
00:52:35,200 --> 00:52:39,600
Speaker 19: product is comparable. It doesn't work like that. I don't

1056
00:52:39,680 --> 00:52:42,480
Speaker 19: think you know, certainly, consumers are not dumb, and they're

1057
00:52:42,520 --> 00:52:44,040
Speaker 19: going to pick up on that really quick.

1058
00:52:44,239 --> 00:52:47,600
Speaker 2: I did drive the snot out of this thing, and

1059
00:52:48,360 --> 00:52:51,719
Speaker 2: it was super fun. I mean, it's a gigantic, obviously

1060
00:52:51,920 --> 00:52:58,919
Speaker 2: beast but it's got this active electronic anti roll bar

1061
00:52:59,040 --> 00:53:01,879
Speaker 2: in it that holds it flat and neutral even when

1062
00:53:01,880 --> 00:53:04,799
Speaker 2: you rip it around corners at speeds that.

1063
00:53:04,760 --> 00:53:06,600
Speaker 7: Are super legal.

1064
00:53:06,920 --> 00:53:10,879
Speaker 2: But I feel like I could get a lot more

1065
00:53:10,920 --> 00:53:14,399
Speaker 2: car from the same manufacturer for so much less. I'd

1066
00:53:14,560 --> 00:53:17,520
Speaker 2: much prefer the X five if you need the suv.

1067
00:53:17,840 --> 00:53:19,960
Speaker 2: If you don't need something like that, I much prefer

1068
00:53:20,040 --> 00:53:22,879
Speaker 2: the two series. Hannah, what do you think about BMW

1069
00:53:23,160 --> 00:53:27,239
Speaker 2: in terms of their you know, competitiveness and in other segments.

1070
00:53:27,760 --> 00:53:31,040
Speaker 19: Well, obviously they're competitive in in the X five and

1071
00:53:31,120 --> 00:53:34,360
Speaker 19: the two series, and of course you know their sedans

1072
00:53:34,960 --> 00:53:38,880
Speaker 19: and they have been. I think where it gets confusing

1073
00:53:39,080 --> 00:53:42,960
Speaker 19: is when BMW is doing the hybrid things, the electric things,

1074
00:53:43,000 --> 00:53:47,160
Speaker 19: and they're also, let's not forget doing hydrogen. It's just

1075
00:53:47,400 --> 00:53:51,000
Speaker 19: a little muddled to me, and I think their messaging

1076
00:53:51,080 --> 00:53:54,560
Speaker 19: is muddled and they haven't really figured out what it

1077
00:53:54,680 --> 00:53:57,799
Speaker 19: means for a BMW to be running a hybrid or

1078
00:53:57,800 --> 00:54:00,560
Speaker 19: an electric power plant, whereas other company. And he's just

1079
00:54:00,600 --> 00:54:03,160
Speaker 19: seen miles ahead in that regard, Hannah.

1080
00:54:03,280 --> 00:54:06,120
Speaker 8: I know you just spent the past week at Monterey.

1081
00:54:06,200 --> 00:54:10,120
Speaker 8: What'd you see there? And oh my, did it reach

1082
00:54:10,160 --> 00:54:14,280
Speaker 8: your expectations? That this is simply the best auto show

1083
00:54:14,560 --> 00:54:16,680
Speaker 8: in the world anywhere, anytime.

1084
00:54:17,640 --> 00:54:20,439
Speaker 19: Yes, yes, it's a little bit mind blowing. We saw

1085
00:54:20,480 --> 00:54:23,360
Speaker 19: more than twenty new car debuts. This is obviously the

1086
00:54:23,440 --> 00:54:25,680
Speaker 19: new auto show. If you want to see new cars,

1087
00:54:25,680 --> 00:54:28,440
Speaker 19: you go there. I'll tell you what really interested me,

1088
00:54:28,560 --> 00:54:32,880
Speaker 19: which was this three hundred thousand dollars Ford Mustang GTD.

1089
00:54:34,280 --> 00:54:37,279
Speaker 19: Ford's Jim Farley has made no bones about the fact

1090
00:54:37,280 --> 00:54:40,359
Speaker 19: that he's going right after Porsche with this Mustang. It's

1091
00:54:40,400 --> 00:54:42,919
Speaker 19: a street legal Mustang based on the car that they're

1092
00:54:42,920 --> 00:54:46,200
Speaker 19: going to run in Lamon next year. And Jim Farley

1093
00:54:46,239 --> 00:54:48,600
Speaker 19: told me straight up, Hey, I've been a fan of

1094
00:54:48,600 --> 00:54:51,160
Speaker 19: Porsche for fifty years. I've been watching what they did

1095
00:54:51,160 --> 00:54:53,840
Speaker 19: with their racing programs, their GT three cars, their GT

1096
00:54:53,880 --> 00:54:56,720
Speaker 19: two cars, and we want to do that with Mustang.

1097
00:54:56,760 --> 00:54:59,640
Speaker 19: There's no reason why we can't. So I'm very interested

1098
00:55:00,120 --> 00:55:02,600
Speaker 19: that particular car three for.

1099
00:55:02,680 --> 00:55:08,200
Speaker 2: Uh, I mean, they price themselves higher than any Porsche competition.

1100
00:55:08,280 --> 00:55:12,000
Speaker 8: You could get two, almost get two of the MX's

1101
00:55:12,000 --> 00:55:12,720
Speaker 8: for that much.

1102
00:55:12,560 --> 00:55:16,200
Speaker 19: Money, Yeah, you could. I mean here's the thing. I

1103
00:55:16,239 --> 00:55:19,360
Speaker 19: think if the race car version of that car wins

1104
00:55:19,400 --> 00:55:23,280
Speaker 19: next year at Lemon, all will be forgiven, including the

1105
00:55:23,280 --> 00:55:26,320
Speaker 19: the rear transactal on the production car and the front

1106
00:55:26,360 --> 00:55:30,000
Speaker 19: engine and the pricing. Honestly, I think it all goes

1107
00:55:30,040 --> 00:55:32,600
Speaker 19: away if they win next year, so we'll see.

1108
00:55:32,840 --> 00:55:34,880
Speaker 8: What else did you see that caught your eye?

1109
00:55:35,640 --> 00:55:38,360
Speaker 19: Okay, there's this, I'm sure you read about it, the

1110
00:55:38,520 --> 00:55:43,120
Speaker 19: thirty million dollar Rolls Royce droptail. This is part of

1111
00:55:43,160 --> 00:55:47,520
Speaker 19: their Coach Built series, which basically means consumers can design

1112
00:55:47,520 --> 00:55:51,239
Speaker 19: a car from the ground up. They're making four of them.

1113
00:55:51,520 --> 00:55:53,759
Speaker 19: They don't want to say who's buying it, but you

1114
00:55:53,840 --> 00:55:59,880
Speaker 19: have to imagine this is an international family, longtime collectors.

1115
00:56:00,200 --> 00:56:02,640
Speaker 19: Rolls Royce says, it's not about just who can come

1116
00:56:02,680 --> 00:56:05,240
Speaker 19: to us with a blank checkbook. It's not just about

1117
00:56:05,280 --> 00:56:09,080
Speaker 19: people who own twenty Rolls Royces. It's actually a mix

1118
00:56:09,120 --> 00:56:11,360
Speaker 19: of things, and it's people who are engaged with the brand.

1119
00:56:12,640 --> 00:56:16,960
Speaker 19: But this thirty million dollar droptail, it's a roadster. Actually

1120
00:56:17,760 --> 00:56:18,920
Speaker 19: was was pretty striking.

1121
00:56:19,239 --> 00:56:19,799
Speaker 7: It looks hot.

1122
00:56:19,840 --> 00:56:22,000
Speaker 2: I mean I saw it on your either your on

1123
00:56:22,040 --> 00:56:25,160
Speaker 2: your Twitter feed or your Instagram feed. One of the

1124
00:56:25,200 --> 00:56:29,480
Speaker 2: other things that I saw on your social media is

1125
00:56:29,520 --> 00:56:31,040
Speaker 2: the new Lamborghini or.

1126
00:56:31,000 --> 00:56:33,000
Speaker 7: I guess it's a prototype electric.

1127
00:56:35,080 --> 00:56:35,680
Speaker 3: So hot.

1128
00:56:35,800 --> 00:56:36,759
Speaker 7: Yeah, that looks great.

1129
00:56:36,960 --> 00:56:39,680
Speaker 8: I'm excited about that me too.

1130
00:56:39,840 --> 00:56:42,600
Speaker 19: It's all electric, and I have to say there there

1131
00:56:42,880 --> 00:56:47,360
Speaker 19: was some grumbling among of course the Lamborghini periods that

1132
00:56:48,000 --> 00:56:51,399
Speaker 19: what is happening? We swore we'd never do this, et cetera,

1133
00:56:51,440 --> 00:56:54,680
Speaker 19: et cetera, et cetera. But that car looks amazing.

1134
00:56:55,239 --> 00:56:55,520
Speaker 15: Uh.

1135
00:56:55,600 --> 00:56:58,560
Speaker 19: That's a Mitcha Boker creation. Mitya is the head designer

1136
00:56:58,600 --> 00:57:02,560
Speaker 19: of Lamborghini. He actually was formerly at Portia. He's actually German,

1137
00:57:02,880 --> 00:57:06,160
Speaker 19: but he's making some great Italian cars. This is his

1138
00:57:06,280 --> 00:57:10,000
Speaker 19: latest concept. I think it looks fabulous and they kind

1139
00:57:10,000 --> 00:57:11,120
Speaker 19: of have to make it right.

1140
00:57:12,239 --> 00:57:14,960
Speaker 2: Yeah, they have to go electric at some point. And

1141
00:57:15,000 --> 00:57:18,440
Speaker 2: of course Lamborghini's in the Porsche stable. They're all folks,

1142
00:57:18,440 --> 00:57:20,000
Speaker 2: few orud East.

1143
00:57:20,440 --> 00:57:23,920
Speaker 7: But yeah, yeah, I can't wait to see that Elliott.

1144
00:57:26,760 --> 00:57:28,880
Speaker 3: Business. We're talking cars with a couple of car geeks.

1145
00:57:28,880 --> 00:57:33,360
Speaker 1: What could go wrong here in the Bloomberg Interactive Broker studio. Concourse,

1146
00:57:33,400 --> 00:57:35,800
Speaker 1: the elegance, I've been there many many times, very very

1147
00:57:35,800 --> 00:57:37,800
Speaker 1: cool on the Monterey Peninsula.

1148
00:57:38,000 --> 00:57:41,600
Speaker 10: You're listening to the tape Cancer Live program Bloomberg Markets

1149
00:57:41,640 --> 00:57:45,040
Speaker 10: weekdays at ten am Eastern on Bloomberg Radio, the tune

1150
00:57:45,080 --> 00:57:46,959
Speaker 10: in app, Bloomberg dot Com, and the.

1151
00:57:46,840 --> 00:57:48,000
Speaker 11: Bloomberg Business App.

1152
00:57:48,080 --> 00:57:50,880
Speaker 10: You can also listen live on Amazon Alexa from our

1153
00:57:50,920 --> 00:57:55,320
Speaker 10: flagship New York station Just Say Alexa playing Bloomberg eleven thirty.

1154
00:57:56,760 --> 00:57:59,200
Speaker 1: A bit of an m and a trade here in

1155
00:57:59,240 --> 00:58:02,360
Speaker 1: the I guess the restaurant business, the fast food restaurant,

1156
00:58:02,360 --> 00:58:05,760
Speaker 1: the sandwich business. Rowar Capital is in a deal to

1157
00:58:05,800 --> 00:58:09,640
Speaker 1: buy a subway for more than nine billion dollars. Row

1158
00:58:09,640 --> 00:58:14,560
Speaker 1: Our Capital, as private equity firm, owns brands including Arby's, Duncan,

1159
00:58:14,800 --> 00:58:16,120
Speaker 1: Buffalo Wide, Wings.

1160
00:58:15,880 --> 00:58:18,120
Speaker 3: And rival substore Jimmy Johns.

1161
00:58:18,200 --> 00:58:20,000
Speaker 1: Let's break down this transaction get a sense of what's

1162
00:58:20,000 --> 00:58:22,479
Speaker 1: happening in the restaurant business. We check out with Mike Alen.

1163
00:58:22,560 --> 00:58:25,680
Speaker 1: He's a senior restaurant analyst for Bloomberg Intelligence. Hey, Mike,

1164
00:58:25,720 --> 00:58:27,760
Speaker 1: talk to us about row Our Capital.

1165
00:58:27,320 --> 00:58:29,960
Speaker 3: And this deal for subway. What's What's what's going on here?

1166
00:58:31,800 --> 00:58:32,720
Speaker 7: Yeah, Rourck has.

1167
00:58:33,240 --> 00:58:37,920
Speaker 20: A long history of activity in the restaurant space. They

1168
00:58:37,960 --> 00:58:39,680
Speaker 20: currently own a ton of brands, you know, a lot

1169
00:58:39,760 --> 00:58:42,280
Speaker 20: of a lot of great brands that you mentioned. They've

1170
00:58:42,280 --> 00:58:43,440
Speaker 20: been very active in.

1171
00:58:43,440 --> 00:58:45,600
Speaker 3: The space over the last decade or so.

1172
00:58:46,280 --> 00:58:50,400
Speaker 20: Uh, and and this is you know, another interesting addition

1173
00:58:50,480 --> 00:58:53,160
Speaker 20: to their portfolio, you know, to their to your point,

1174
00:58:54,160 --> 00:58:58,480
Speaker 20: they own Arby's and Jimmy John's. That's through their Inspire

1175
00:58:58,520 --> 00:59:03,320
Speaker 20: Brands group. And so you know, they've had a lot

1176
00:59:03,320 --> 00:59:06,200
Speaker 20: of experience turnaround brands, turning around brands. They've had a

1177
00:59:06,200 --> 00:59:10,080
Speaker 20: lot of experience running sandwich shops, and so they see

1178
00:59:10,080 --> 00:59:13,360
Speaker 20: some value here. They pay thirteen times ebitdah, which is

1179
00:59:13,440 --> 00:59:16,160
Speaker 20: kind of high considering some of the problems that they have,

1180
00:59:16,360 --> 00:59:19,360
Speaker 20: but you know, clearly with the scale that they have,

1181
00:59:21,000 --> 00:59:24,960
Speaker 20: you know, there is definitely some potential in this brand.

1182
00:59:25,440 --> 00:59:30,680
Speaker 8: So, Mike, this is Barry Riddholts. Subway has thirty thirty

1183
00:59:30,800 --> 00:59:35,640
Speaker 8: seven thousand stores across one hundred countries. What is it

1184
00:59:36,240 --> 00:59:39,240
Speaker 8: that Rourke Capital is looking for? Is it the footprint,

1185
00:59:39,280 --> 00:59:41,959
Speaker 8: is it the real estate or is it just Hey,

1186
00:59:42,000 --> 00:59:44,880
Speaker 8: this is a lot of potential that's been underperforming.

1187
00:59:46,880 --> 00:59:50,360
Speaker 20: I think it's the latter, right. This is a franchise

1188
00:59:50,520 --> 00:59:54,040
Speaker 20: brand that you know, spits off a lot of cash flow, right,

1189
00:59:54,080 --> 00:59:56,640
Speaker 20: and so that's very attractive to somebody like Rourke. You

1190
00:59:56,680 --> 01:00:00,640
Speaker 20: can you can lever it up and you know, really

1191
01:00:00,760 --> 01:00:03,400
Speaker 20: juice to returns on something like this. You know, this

1192
01:00:03,560 --> 01:00:07,280
Speaker 20: is a chain where average unit volumes have really lagged

1193
01:00:07,320 --> 01:00:09,800
Speaker 20: over the last you know, five, six, seven years, and

1194
01:00:10,240 --> 01:00:13,000
Speaker 20: average unit volumes are less than a half a million dollars.

1195
01:00:13,080 --> 01:00:16,720
Speaker 20: You know, that's less than half of what Jersey Mikes

1196
01:00:16,760 --> 01:00:18,960
Speaker 20: is doing. They're at about one point one million. So

1197
01:00:19,880 --> 01:00:22,480
Speaker 20: there's definitely some room for growth. And you know, I

1198
01:00:22,520 --> 01:00:25,960
Speaker 20: think that the chain has been moving in the right direction.

1199
01:00:26,080 --> 01:00:29,320
Speaker 20: You know, adding slicers is going to improve you know,

1200
01:00:29,360 --> 01:00:33,240
Speaker 20: what they've done recently has improved the quality of the

1201
01:00:33,480 --> 01:00:36,080
Speaker 20: of the meat. They spent a lot of money on

1202
01:00:36,160 --> 01:00:39,520
Speaker 20: advertising with like very high profile celebrities. They've made some

1203
01:00:39,600 --> 01:00:43,080
Speaker 20: menu changes, and they're closing a lot of stores, right

1204
01:00:43,200 --> 01:00:46,400
Speaker 20: and so when you close your underperforming stores. You know,

1205
01:00:46,400 --> 01:00:49,400
Speaker 20: they've closed six thousand stores I think since twenty fifteen

1206
01:00:49,480 --> 01:00:52,400
Speaker 20: or twenty sixteen. Even they're still closing it. I think

1207
01:00:52,560 --> 01:00:55,840
Speaker 20: six hundred stores or so. We're closing twenty twenty two.

1208
01:00:55,960 --> 01:01:00,600
Speaker 20: So when you start pairing the underperforming stores, the returns

1209
01:01:00,600 --> 01:01:03,160
Speaker 20: on investment cash on cash returns start looking a lot

1210
01:01:03,200 --> 01:01:07,200
Speaker 20: better for franchise ease. And then franchisees are from outside

1211
01:01:07,200 --> 01:01:10,760
Speaker 20: the system, you know, might kind of look back into

1212
01:01:10,840 --> 01:01:13,400
Speaker 20: Subway again, Right, So I think they're all pushing the

1213
01:01:13,440 --> 01:01:17,080
Speaker 20: right buttons. But you can't turn around an aircraft carrier

1214
01:01:17,120 --> 01:01:18,640
Speaker 20: on a dime, right, It's going to take some time.

1215
01:01:18,680 --> 01:01:23,680
Speaker 8: So let's address that. Because Josie Mike's feels younger, newer, fresher.

1216
01:01:23,760 --> 01:01:27,080
Speaker 8: They haven't been around quite as long Subway. This is

1217
01:01:27,120 --> 01:01:29,600
Speaker 8: a storied brand that's been around, you know, more than

1218
01:01:29,640 --> 01:01:32,640
Speaker 8: half a century, and it feels like it's kind of

1219
01:01:32,680 --> 01:01:36,440
Speaker 8: gotten tired and stodgy. How can you inject new life

1220
01:01:36,480 --> 01:01:40,000
Speaker 8: into a company like this when you know there's a

1221
01:01:40,040 --> 01:01:41,280
Speaker 8: lot of history to overcome.

1222
01:01:43,120 --> 01:01:47,000
Speaker 20: Yeah, I think you know, quality is usually a great

1223
01:01:47,040 --> 01:01:49,960
Speaker 20: starting point for a good turnaround, and like you know,

1224
01:01:50,000 --> 01:01:53,520
Speaker 20: to my point earlier, like spending money on slicers is

1225
01:01:53,560 --> 01:01:55,720
Speaker 20: a good start, but you know, maybe there's some other

1226
01:01:55,760 --> 01:01:58,160
Speaker 20: things that they need to do. Maybe it's upgrades on

1227
01:01:58,480 --> 01:02:00,440
Speaker 20: the quality of the meat. Maybe it's a grades on

1228
01:02:00,760 --> 01:02:03,800
Speaker 20: the quality of the bread and things of that nature.

1229
01:02:04,920 --> 01:02:06,600
Speaker 20: But you know, you know, to your point, you have

1230
01:02:06,680 --> 01:02:09,120
Speaker 20: to get people in the door, right, Like Jersey Mikes

1231
01:02:09,160 --> 01:02:12,600
Speaker 20: is bringing twice as many customers, maybe more into their stores,

1232
01:02:12,640 --> 01:02:15,640
Speaker 20: and so by proxy, the food is going to be fresher, right,

1233
01:02:16,400 --> 01:02:19,280
Speaker 20: inventory is not going to sit there in the deli case,

1234
01:02:20,680 --> 01:02:24,919
Speaker 20: So you know, it's gonna definitely take some take some time.

1235
01:02:25,000 --> 01:02:28,720
Speaker 20: But you know, listen, they have this massive footprint. They

1236
01:02:28,760 --> 01:02:31,680
Speaker 20: have a ton of scale, right, so they can source

1237
01:02:31,760 --> 01:02:35,040
Speaker 20: product more cheaply than anybody. They are in a lot

1238
01:02:35,080 --> 01:02:37,720
Speaker 20: of locations that Jersey Mikes isn't, So there's the risk

1239
01:02:37,760 --> 01:02:40,720
Speaker 20: of Jersey Mike's continuing to move down the street from

1240
01:02:40,720 --> 01:02:43,440
Speaker 20: them and kind of maybe take some of their market

1241
01:02:43,440 --> 01:02:47,680
Speaker 20: share if they don't act aggressively enough, you know. So

1242
01:02:48,320 --> 01:02:50,040
Speaker 20: you know, it's going to be interesting to watch. But

1243
01:02:50,400 --> 01:02:52,880
Speaker 20: we're Capital and Inspire brands. I don't know if they're

1244
01:02:52,880 --> 01:02:55,200
Speaker 20: going to fold this into Inspire brands. Both have a

1245
01:02:55,200 --> 01:02:58,320
Speaker 20: tremendous track record of turning around restaurants and running great

1246
01:02:58,320 --> 01:03:01,120
Speaker 20: restaurants and restaurant brands. So it's going to be interesting

1247
01:03:01,160 --> 01:03:01,520
Speaker 20: to watch.

1248
01:03:01,760 --> 01:03:05,520
Speaker 1: Hey, Mike, you covered the entire restaurant space. Where where's

1249
01:03:05,560 --> 01:03:07,040
Speaker 1: the consumer spending money these days?

1250
01:03:07,040 --> 01:03:07,600
Speaker 3: What do you see?

1251
01:03:07,600 --> 01:03:09,640
Speaker 1: What are the trends out there and who's doing a

1252
01:03:09,640 --> 01:03:11,360
Speaker 1: good job in the restaurant space.

1253
01:03:12,640 --> 01:03:14,200
Speaker 3: Yeah, I thinks it's slowing a little bit.

1254
01:03:14,680 --> 01:03:14,840
Speaker 5: You know.

1255
01:03:14,880 --> 01:03:17,000
Speaker 20: I was talking to a client essay, which was kind

1256
01:03:17,000 --> 01:03:19,680
Speaker 20: of on the opposite side of the spectrum. What had

1257
01:03:19,720 --> 01:03:23,360
Speaker 20: surprised me on the downside, and that's fine dining, and

1258
01:03:23,400 --> 01:03:25,840
Speaker 20: I've heard, you know, some some issues with some of

1259
01:03:25,840 --> 01:03:28,960
Speaker 20: the high end retailers, and it looks like that's kind

1260
01:03:28,960 --> 01:03:32,000
Speaker 20: of spilling over into restaurants, which is interesting and kind

1261
01:03:32,000 --> 01:03:35,520
Speaker 20: of surprising, right because we've had this K shaped recovery

1262
01:03:35,560 --> 01:03:38,880
Speaker 20: where people that on the higher end of the income

1263
01:03:38,920 --> 01:03:40,960
Speaker 20: scale were able to work from home and during the

1264
01:03:41,000 --> 01:03:42,959
Speaker 20: pandemic and saved a lot of money because they weren't

1265
01:03:42,960 --> 01:03:45,200
Speaker 20: going on vacations and going out to restaurants, have all

1266
01:03:45,200 --> 01:03:48,360
Speaker 20: this disposable income and continue to spend, whereas the low

1267
01:03:48,400 --> 01:03:53,000
Speaker 20: income consumer and middle income consumer were more we're tightening

1268
01:03:53,000 --> 01:03:53,920
Speaker 20: their belts a little bit.

1269
01:03:55,200 --> 01:03:56,200
Speaker 3: You know, who's doing well.

1270
01:03:56,200 --> 01:03:58,360
Speaker 20: There's a couple of chains though, that continue to do well,

1271
01:03:58,400 --> 01:04:02,400
Speaker 20: you know, McDonald's, even in a slowing in A McDonald's

1272
01:04:02,400 --> 01:04:06,080
Speaker 20: in a slowing environment for restaurants tends to have a

1273
01:04:06,120 --> 01:04:08,560
Speaker 20: pretty good advantage, you know, like Subway, they have a

1274
01:04:08,600 --> 01:04:10,640
Speaker 20: ton of scale and they can offer price points that

1275
01:04:10,680 --> 01:04:14,840
Speaker 20: competitors just can't match, and so their sales trends continue

1276
01:04:14,880 --> 01:04:18,919
Speaker 20: to be very strong, but we've seen a slow down

1277
01:04:18,960 --> 01:04:21,080
Speaker 20: in the second quarter. A few chains saw some some

1278
01:04:21,120 --> 01:04:26,400
Speaker 20: slowdowns versus twenty nineteen Starbucks, Chipotle, A bunch of names

1279
01:04:26,440 --> 01:04:29,280
Speaker 20: that we cover started to slow a bit. But in general,

1280
01:04:29,360 --> 01:04:32,040
Speaker 20: those those fast casual, those quick service type names and

1281
01:04:32,080 --> 01:04:35,600
Speaker 20: fast casual type names are probably better positioned than the

1282
01:04:35,680 --> 01:04:39,080
Speaker 20: full service chains that we cover. Some casual diners companies

1283
01:04:39,120 --> 01:04:41,200
Speaker 20: like Cheesecake Factory and Brinker.

1284
01:04:41,000 --> 01:04:43,480
Speaker 1: And of course my favorite, as you well know, is

1285
01:04:43,520 --> 01:04:46,920
Speaker 1: Cracker Barrel Stock said a fifty two week low today

1286
01:04:47,320 --> 01:04:50,960
Speaker 1: off thirteen percent. The country Boy breakfast to die for.

1287
01:04:51,120 --> 01:04:53,920
Speaker 1: Just loosen the belt, sit right down, Boom you hit it.

1288
01:04:54,080 --> 01:04:57,800
Speaker 1: Mike Klin, senior restaurant analysts for Bloomberg Intelligence, joining us.

1289
01:04:57,800 --> 01:04:59,680
Speaker 1: I know what I'm talking about when it comes to restaurants.

1290
01:05:00,160 --> 01:05:03,760
Speaker 1: Mike Kaylin is the experts. We appreciate that S and P.

1291
01:05:03,840 --> 01:05:06,440
Speaker 1: Five hundred and off a half of one percent.

1292
01:05:06,680 --> 01:05:07,440
Speaker 3: I will keep that in mind.

1293
01:05:07,480 --> 01:05:09,760
Speaker 1: Barry Reholds, thanks for stopping by giving us some of

1294
01:05:09,840 --> 01:05:12,440
Speaker 1: your time on Thursday.

1295
01:05:12,920 --> 01:05:16,000
Speaker 2: Thanks for listening to the Bloomberg Markets podcasts. You can

1296
01:05:16,040 --> 01:05:19,840
Speaker 2: subscribe and listen to interviews at Apple Podcasts or whatever

1297
01:05:19,920 --> 01:05:23,640
Speaker 2: podcast platform you prefer I'm Matt Miller. I'm on Twitter

1298
01:05:23,840 --> 01:05:25,760
Speaker 2: at Matt Miller nineteen seventy three.

1299
01:05:26,200 --> 01:05:28,560
Speaker 3: And I'm fall Sweeney. I'm on Twitter at pt Sweeney.

1300
01:05:28,680 --> 01:05:31,360
Speaker 1: Before the podcast, you can always catch us worldwide at

1301
01:05:31,400 --> 01:05:33,120
Speaker 1: Bloomberg Radio