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Speaker 3: July fourteenth, That is Why, and Jacob Mordon kicks off

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Speaker 3: the earning season Apple and the Likes later in the

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Speaker 3: month of July twenty eighth will come out with some

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Speaker 3: of those earnings. Your emphasis on that is an important one.

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Speaker 1: Chris Harvey wasn't a KEM major, but he was a

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Speaker 1: bucknell which is like the Buckneil bubble. All you do

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Speaker 1: is study financiers here because the winters are so cold.

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Speaker 1: He joins US now Equity Strategy at Wells Fargo. Your note,

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Speaker 1: Chris is absolutely brilliant about thinking back to nineteen ninety eight,

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Speaker 1: ninety nine into two thousand and two thousand and one

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Speaker 1: tech the analog of looking back. What's the number one

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Speaker 1: message in your study of this tech bubble versus that

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Speaker 1: tech bubble?

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Speaker 4: So the number one issue is tech is not going

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Speaker 4: to roll over. The major theme is not going to

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Speaker 4: roll over until you crack the economy. That's what happened

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Speaker 4: back in ninety nine. That's like what's going to happen now.

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Speaker 4: And I don't think you cracked the economy until the

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Speaker 4: FED gets more aggressive, and so we'll have some wiggles.

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Speaker 4: I think we'll have a pull back in the market,

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Speaker 4: we'll have a pullback in big tech, but that for

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Speaker 4: all theme is still in place, and not until the

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Speaker 4: economy breaks do we really think about that trend breaking.

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Speaker 5: Is tech in a set of individual companies you study

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Speaker 5: at Wells Fargo or is it this a morphous sector

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Speaker 5: blob up there like a nineteen fifty sci fi movie.

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Speaker 4: We do study tech, we do study individual companies, but

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Speaker 4: what we do is we focus in on a lot

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Speaker 4: on the uber what we call the uber cap or

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Speaker 4: the top fifty names. You can look at one or

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Speaker 4: two names and that's great, but that doesn't give you

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Speaker 4: a trend. And we look at the uber caps because

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Speaker 4: as you go across capitalization, small cap, MidCap, large cap,

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Speaker 4: they all have characteristics, and the uber caps are the

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Speaker 4: ones that really have that AI exposure, that tech exposure.

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Speaker 4: And again going back to nineteen ninety nine, that's one

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Speaker 4: of the things that we did see. We saw that

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Speaker 4: uber cap out performance, we saw that tech oup performance,

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Speaker 4: and before all that, we saw the economy and the

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Speaker 4: old economy stocks roll over.

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Speaker 3: You said something I want to pick up on. You

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Speaker 3: don't crack the economy until the FED gets more aggressive.

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Speaker 3: Are you saying the FED hasn't gotten aggressive?

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Speaker 4: They said the FED has gotten aggressive. But I think

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Speaker 4: we can all agree that the economy is a lot

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Speaker 4: less interestrate sensitive than we thought. The way we're characterizing

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Speaker 4: the economy is an economic malaise. We did think we

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Speaker 4: were going to We thought the probability of recession spiked

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Speaker 4: with the banking crisis, but now we think that's come

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Speaker 4: back down, and so we're really looking at an economic

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Speaker 4: malaise more or less than a recession on the horizon. Right,

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Speaker 4: the consumer is still okay, still has cash on the

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Speaker 4: balance sheet, eating through their savings, but still has savings.

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Speaker 4: Corporations still have plenty of savings. Balance sheets are much better,

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Speaker 4: and so really you need some sort of shock to

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Speaker 4: get us into a recession. We need a lot more time.

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Speaker 4: This is taking a lot longer than we expect, and

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Speaker 4: I think it will take a lot longer than we expect.

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Speaker 3: Do you think that the amount that people are willing

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Speaker 3: to pay for goods will come down, that there will

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Speaker 3: start to be some consumer pushback at a time when

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Speaker 3: we just heard FedEx. Yes, you're seeing volumes down, but

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Speaker 3: there's still increasing prices more than expected. And that is

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Speaker 3: a theme across a lot of different industries.

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Speaker 4: So I may go off on a little bit of

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Speaker 4: a tangent if I do, just pulling back in because I.

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Speaker 6: Talk about don't worry, it'll lot care about it.

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Speaker 4: So I talk about the consumer a lot. And if

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Speaker 4: you think about the US consumer, the US consumer has

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Speaker 4: been buying, and I'll exaggerate a little bit since he

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Speaker 4: or she was five years old. Right, it's a very

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Speaker 4: savvy consumer. We've been spending a lot of money. We

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Speaker 4: know when there's utility. And what I'm seeing is the

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Speaker 4: US consumer has been pulling back. They've been pulling back

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Speaker 4: on goods. They're not finding a lot of utility there.

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Speaker 4: If you look at at real retail sales, if you

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Speaker 4: look at at retail sales in general, it's not as

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Speaker 4: strong as you would have expected. You are seeing if

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Speaker 4: you go to the walmarts and the targets, you are

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Speaker 4: seeing a trade down. The US consumer's behavior has changed,

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Speaker 4: and I think the US consumer is a lot more

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Speaker 4: savvy than we give here or she.

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Speaker 3: Credit for going forward? Then do you think we have

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Speaker 3: seen this rolling recession in certain areas that offset something

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Speaker 3: that's deeper than an economic blaze?

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Speaker 7: Regardless of what FED does.

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Speaker 3: They are cracking certain segments of the economy and others

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Speaker 3: continue to chug along because of different advancements and less

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Speaker 3: interest rate sensitivity.

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Speaker 4: You really hit on a great point, and this is

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Speaker 4: something we talk about in the office a lot. You

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Speaker 4: can't paid to this economy with one brush, and you

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Speaker 4: are seeing kind of a it's a very heterogeneous economy

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Speaker 4: and market. You're seeing certain sectors that have already rolled

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Speaker 4: over and are beginning to improve. You're seeing other sectors

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Speaker 4: that are beginning to roll over for the first time

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Speaker 4: in a while. And so one of the things that's

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Speaker 4: causing this to be in economic delays is there's not

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Speaker 4: it's not synchronous.

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Speaker 2: Right.

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Speaker 4: The economy is very very If you look at a

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Speaker 4: housing market, the housing market, the new issue market or

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Speaker 4: the new market is very strong, but the old one

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Speaker 4: is three and thirty. I'm not going to leave my

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Speaker 4: house because I have a thirty year mortgage at three percent.

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Speaker 4: Very different. If you look at some of the construction spending, manufacturing, warehousing,

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Speaker 4: it's through the roof, but other parts of housing and

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Speaker 4: construction are begin to roll over. So again, I think

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Speaker 4: you hit on a very important point. Is something that

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Speaker 4: we really have been diving into and it's it's hard

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Speaker 4: to kind of disentangle. But this economy is not it's

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Speaker 4: not really synced up and you cannot paint it with

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Speaker 4: one brush, which is why the economy has been a

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Speaker 4: lot more durable than a lot of people have expected.

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Speaker 1: And a huge seam of the program this lack of

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Speaker 1: aggregation right now is tangible.

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Speaker 2: I want to point out one thing you can do.

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Speaker 1: This off the Bloomberg folks, the Bloomberg terminal and the

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Speaker 1: description screen toes JP. Morgan is owned by institutional seventy

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Speaker 1: five percent. Apple is owned sixty one percent. I know

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Speaker 1: you don't want to talk individual securities here, but you

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Speaker 1: know what was me, Big Tech to the Moon. We're

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Speaker 1: all going to die, except can I make the statement

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Speaker 1: big Tech is under owned by institutions?

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Speaker 4: I would agree with that one hundred percent. And what

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Speaker 4: I what I would say is we do a lot

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Speaker 4: of positioning work, and in our position work, what we've

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Speaker 4: seen for years is the Byside community is underweight tech,

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Speaker 4: but it's mainly underweight Apple and Microsoft. We were talking

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Speaker 4: about this in the office five years ago, kind of

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Speaker 4: a flip title, but we entitled the Return of the Mac.

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Speaker 4: And what we had seen back five years ago is

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Speaker 4: a very big underweight, an exceptional underweight in Apple that's

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Speaker 4: never closed. And what we're seeing is one of the

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Speaker 4: things that that's giving us pause andive. I think one

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Speaker 4: of the things that's pushing the market is this underweight

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Speaker 4: in uber caps in Apple and Microsoft and a few

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Speaker 4: of the others, so I would agree with you. What

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Speaker 4: you're saying is the institutions are much much more underweight.

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Speaker 1: Branda John from Italy emails in and he says, get

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Speaker 1: a new SPX quote from Chris Harvey here forty two hundred?

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Speaker 2: Can you lift it up?

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Speaker 4: Come on, I gonna make some news.

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Speaker 2: Here's what I say. So are you in target? But hey,

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Speaker 2: no one's watching go so.

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Speaker 4: Our forty two are your on price targets for two hundred?

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Speaker 4: At the end of last year, we also had a

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Speaker 4: soft landing target that was forty four hundred. Right, we

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Speaker 4: cannot two targets.

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Speaker 2: Do you have a Harkwark target? If we get a.

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Speaker 4: Horkwarks, I can't give you forty five hundred. But this

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Speaker 4: is why we go back to it's about the economy.

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Speaker 4: Because I can make certain adjustments, I can change my estimates,

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Speaker 4: but really do I have a lot of confidence in that?

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Speaker 8: No?

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Speaker 4: But what I have a lot of confidence in is

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Speaker 4: it's really about the economy. The major trends is not

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Speaker 4: gonna break until the economy breaks.

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Speaker 2: Chris Harvey Wells Frio.

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Speaker 1: Francis Donald is a manual Life global chief economist and

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Speaker 1: strategist she's very good at rining blistering bullet points to

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Speaker 1: cut to the chase. We're gonna cut to the chase,

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Speaker 1: which is, we all know the US is way out

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Speaker 1: front on inflation versus what we saw in United Kingdom

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Speaker 1: today and even Europe Japan being the oddity as well.

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Speaker 1: And you look at the non linearity here. You picked

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Speaker 1: the point three percent. The answer is core inflation's coming down.

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Speaker 1: There's a little bit of a vector in place. But

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Speaker 1: you say the path to two percent, it's going to

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Speaker 1: be brutal.

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Speaker 9: Well, the path to three percent is probably going to

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Speaker 9: be quite easy. We'll be there in the next couple

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Speaker 9: of months, and then a lot of people will claim bakery.

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Speaker 2: Yeah, for sure, and I don't see it.

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Speaker 9: Well, a huge element of this is base effects that

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Speaker 9: are coming through. That's just a big part of it.

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Speaker 9: But you do point out something really critical, which is

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Speaker 9: that if we talk in a year over year, inflation

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Speaker 9: is healing. But for most Americans and in fact global

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Speaker 9: citizens of the world, their price pressures are not coming down.

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Speaker 9: They're still paying substantially more than they did several years

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Speaker 9: ago and are still going to have that embedded view

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Speaker 9: that prices are substantially higher. And that's why these central banks,

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Speaker 9: the FED, the Banks Canada, the Reserve Bank of Australia,

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Speaker 9: the BOE cannot cannot imply that rate cuts are coming.

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Speaker 9: If they do that, we will see a reinflation of

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Speaker 9: inflation or reinflation of inflation expectations.

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Speaker 3: But they've basically said that, and you're still seeing a

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Speaker 3: group of people say inflation is going to be hotter

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Speaker 3: for longer. They don't have what it takes to actually

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Speaker 3: come through with these expectations. So at this point, if

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Speaker 3: they don't raise rates further, will they lose the battle

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Speaker 3: with inflation?

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Speaker 9: Well, no, because a big segment of inflation is not

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Speaker 9: coming from interst rate sensitive sectors. Yes, some portion of

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Speaker 9: it is. But we are in a new paradigm in

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Speaker 9: which inflation is being driven I know, we've said it

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Speaker 9: for years now, more by global morse by supply side factors.

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Speaker 6: So as we move.

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Speaker 9: Forward, and this is why you know this year is interesting,

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Speaker 9: The July meeting is interesting, But what keeps me up

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Speaker 9: at night is twenty twenty four and onwards, because we're

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Speaker 9: heading into an environment where two to three percent inflation

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Speaker 9: in our view, will become the norm and central banks

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Speaker 9: are going to have to make a decision. Do they

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Speaker 9: continue to launch us into recessions or lower growth in

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Speaker 9: order to put us towards two percent, or do they

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Speaker 9: admit that the nature of inflation is changing and two

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Speaker 9: to three percent is more what we're going to be

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Speaker 9: looking at.

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Speaker 3: This is so important and there's a lot to unpack

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Speaker 3: within this. If two to three percent becomes three to

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Speaker 3: four percent, how do they make sure it stays within

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Speaker 3: a certain range and keep their credibility? Are you saying

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Speaker 3: that it would be a mistake for this Fed to

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Speaker 3: reserve to go to five and a half or even

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Speaker 3: six percent in terms of a FED funds rate in

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Speaker 3: order to bring inflation down faster, because all they would

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Speaker 3: do would be to torpedo the economic growth without necessarily

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Speaker 3: changing that paradigm.

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Speaker 9: What I'm saying is that it's a mistake to ask

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Speaker 9: central banks to solve inflation all by themselves. That is

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Speaker 9: the nature of inflation changes. We have to have some

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Speaker 9: hard conversations about what we're asking global central bankers to do. Now,

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Speaker 9: the FED has a little bit of an out because

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Speaker 9: it has a dual mandate. It can look towards the

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Speaker 9: employment side of the picture, which, by the way, they're

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Speaker 9: going to have to change the metrics they look at

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Speaker 9: in order to do that.

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Speaker 6: There are other.

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Speaker 9: Central banks that have single mandates that are only targeting inflation.

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Speaker 9: Those central banks are going to have to say, what

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Speaker 9: is the cost of two percent? Now that the nature

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Speaker 9: of inflation is changing.

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Speaker 1: If you see the disinflationary trajectory you're outlining assumed be

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Speaker 1: serious disinflation, what does as a labor component non firm

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Speaker 1: payrolls do I mean we have people that come on

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Speaker 1: that suggests we could see abrupt decline in non farm payrolls.

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Speaker 2: Do you buy it?

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Speaker 9: Here's the issue with the employment data. Now, in the

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Speaker 9: past we would look at non farm payrolls as a

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Speaker 9: good indicator. We look at the unemployment rate, which of

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Speaker 9: course is what the federals. I am looking at weekly

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Speaker 9: hours worked, among other indicators. And the reason for that

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Speaker 9: is we have companies that have been very clear they

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Speaker 9: are still scarred by the labor shortages that have persisted

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Speaker 9: over the past several years. They will attempt to cut costs,

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Speaker 9: likely in ways that are not laying people off. But

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Speaker 9: what we're likely to see is you stay employed, you

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Speaker 9: get to check that box. But the amount of hours

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Speaker 9: that you're asked to work decline. Now, weekly hours is

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Speaker 9: already back to pre COVID levels. And yet I hear

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Speaker 9: all the time, but the labor market's on fire. Well

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Speaker 9: not if you look at the actual amount of labor

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Speaker 9: being consumed in this environment. The unemployment rate is still

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Speaker 9: going to be probably rising very slowly. We don't actually

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Speaker 9: have it going above five percent even in a recession.

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Speaker 9: But the amount of labor consumed is going to be lower.

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Speaker 9: This is why our metrics have to broaden.

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Speaker 1: Lisa mentioned earlier something we've talked about in surveillance for quarters.

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Speaker 1: I would say, now, which is a solution as patients

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Speaker 1: and expansion of the X axis where they stay higher

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Speaker 1: for longer.

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Speaker 2: To me, that's just it's a.

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Speaker 1: More efficacious move than to worry about twenty five to

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Speaker 1: fifty beeps up down.

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Speaker 2: Do you buy that?

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Speaker 9: Absolutely well? The solution to most things is patients, Tom

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Speaker 9: and Lisa, I agree with you on that one. So

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Speaker 9: when we discuss our forecasts, yes we have penciled in

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Speaker 9: one more rate hike for July, but what we spend

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Speaker 9: much more time thinking about is the response to the

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Speaker 9: next recession. And at this point, what we're looking at

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Speaker 9: in twenty twenty four is yes, the central banks do cut,

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Speaker 9: the Federal Reserve does cut, but only towards what they

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Speaker 9: view as neutral, that they don't actually go into easing territory.

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Speaker 9: They stay restrictive, And of course that brings a question

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Speaker 9: that I know you love to ask on this, what

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Speaker 9: the heck is neutral? That we don't know for sure?

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Speaker 3: When you talk about the resilience in the face of

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Speaker 3: the rate hikes and the lack of interest rate sensitivity

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Speaker 3: in certain areas, what do you make of the fact

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Speaker 3: that markets have continued to rally, that we've erased all

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Speaker 3: of the losses incurred since the beginning of the raid hikes,

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Speaker 3: and that we've seen to your yields rise by one

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Speaker 3: hundred basis points in the past month and a half.

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Speaker 9: I think you use the word reckoning earlier, which is

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Speaker 9: I think an important moment. We have historically, for my

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Speaker 9: entire career, believed that as you face a recession, central

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Speaker 9: banks respond, and indeed, you know, my job on the byside,

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Speaker 9: working for an asset manager is to input our forecast

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Speaker 9: to see what different asset classes are going to do

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Speaker 9: in a recession. We start saying Okay, there's going to

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Speaker 9: be an opportunity for equities for fixed income throughout this.

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Speaker 9: But when we start modeling recessions without material rate cuts

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Speaker 9: or with less rate cuts, then we actually see a

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Speaker 9: very different asset class return. It is not a standard

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Speaker 9: recession playbook. So what I think is happening now is

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Speaker 9: a market that's coming to that realization that recession or

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Speaker 9: bank failures does not equal rate cuts. This is a

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Speaker 9: paradigm change from how we've looked at things.

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Speaker 3: So why is there such a resilience right if that's

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Speaker 3: not going to be rate cuts to the rescue? Is

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Speaker 3: that reckoning going to be lower or is it going

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Speaker 3: to be that Maybe this economy just isn't interest rate

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Speaker 3: sensitive in the way many people expect it.

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Speaker 9: There is an element of that, and there's certainly no

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Speaker 9: shortage of soft landing.

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Speaker 10: Now.

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Speaker 9: The issue I have with that and why I think

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Speaker 9: there's a disconnect right now between equities which are being

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Speaker 9: distorted by the AI story. There's no question about that,

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Speaker 9: and fundamentals is that every single leading indicator of a

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Speaker 9: recession is flashing red. Deeply read Lisa like flashing red.

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Speaker 9: So even if I say to my team, okay, I

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Speaker 9: want you to have cut in half those indicators. Is

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Speaker 9: it still a recession? The answer is yes. So if

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Speaker 9: you want to make the point that it's a soft landing,

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Speaker 9: you have to discredit the bulk of indicators that have

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Speaker 9: traditionally told us a recession.

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Speaker 6: And you can do that.

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Speaker 9: And there are some strategists that have made very good

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Speaker 9: points about excess savings and labor shortages, but I'm not

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Speaker 9: quite there yet. So a recession ahead means there's a

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Speaker 9: disconnect between prices and fundamentals. That's when we make money, Lisa.

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Speaker 1: Thirty seconds quick. Is a stock market disassociated from your

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Speaker 1: cautious economic.

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Speaker 9: View, Yes, but that's okay. We have tactical time frames,

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Speaker 9: medium time frames. Macro is not everything all of the

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Speaker 9: time as much time. As much as I would like

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Speaker 9: macro to be the driver, sometimes you have to trade

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Speaker 9: off momentum, technicals and sentiment. If you're a tactical portfolio manager,

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Speaker 9: that's the moment and recession may still be a couple

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Speaker 9: months away, So sometimes there's a disconnect depending on your

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Speaker 9: time frame. That's also an opportunity.

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Speaker 2: Francis, thank you so much.

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Speaker 1: Francis Donald with us with the manual life of Montre

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Speaker 1: and Manual Life Investment Management.

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Speaker 2: I should say as well.

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Speaker 3: By amandam Line, I'm head of macro credit research at

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Speaker 3: Blackrock joining us now, Amanda, how much more restrictive do

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Speaker 3: five percent rates get as time goes on?

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Speaker 7: Well, thank you Lisa and Tom for having me. Good morning. Look,

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Speaker 7: I think it's a challenging.

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Speaker 11: Environment for a large subset of the corporate credit universe,

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Speaker 11: specifically the subset that has a large exposure to floating

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Speaker 11: rate debt. And you know right now, we've already seen,

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Speaker 11: as you well know, the all in cost of debt

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Speaker 11: for the leverage loan universe double more than double actually

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Speaker 11: since the first quarter of twenty twenty two. And the

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Speaker 11: signaling that we receive from central banks, both the FED

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Speaker 11: and the ECB is that there's probably more room to

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Speaker 11: run there, and President Leguard was very clear on that

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Speaker 11: in her press conference recently. So I think that there's

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Speaker 11: more upward pressure. But as you noted at the start,

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Speaker 11: I think whether we get an extra twenty five or

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Speaker 11: fifty basis points from here is probably less relevant than

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Speaker 11: the amount of time that we stay in this kind

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Speaker 11: of higher cost of capital environment. Because corporates are looking

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Speaker 11: at these upcoming maturity walls, which yes they are in

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Speaker 11: mostly twenty twenty five, but that will need to be

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Speaker 11: addressed sooner rather than later. And for those corporates, we're

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Speaker 11: not really expecting any sort of relief, certainly not in

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Speaker 11: the form.

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Speaker 7: Of rate cuts. And I think actually, if you look at.

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Speaker 11: Where the all in yields are and a lot of

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Speaker 11: the subsets of the corporate credit market, the risk free

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Speaker 11: rate has done a lot of that heavy lifting, and

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Speaker 11: spreads are fairly contained, and so there's probably some room

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Speaker 11: for spreads even too high.

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Speaker 1: There's a lot of math to mat You get that

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Speaker 1: from Milando line, Amanda, let me cut to the chase. Finally,

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Speaker 1: we have a risk free rate. William Sharp is happy

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Speaker 1: we got a risk free rate. And then you've got

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Speaker 1: spreads up. And Lisa's pointed out how narrow spreads are.

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Speaker 1: What are the ramifications if the actual yield in an

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Speaker 1: aggregate corporate space widens out, what actually happens to our

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Speaker 1: listeners and viewers.

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Speaker 11: I think the first order implication is that you uptick

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Speaker 11: in financial distress, and you're already seeing that in the

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Speaker 11: default rates. For example, in the US market, the leverage

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Speaker 11: loan default rate is outpacing the high old bond default

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Speaker 11: rate by the largest magnitude since the data on the

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Speaker 11: Moody series that we use began in nineteen ninety six,

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Speaker 11: and realistically over the past two decades, there have been

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Speaker 11: very few instances where the loan default rate is outpacing

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Speaker 11: the high old bond default rate. And I think really

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Speaker 11: that speaks to the point that you're raising. It's that

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Speaker 11: that real time marking to market of the higher cost

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Speaker 11: of capital in the market. As the policy rate has

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Speaker 11: moved higher, borrowing costs for floating rate debt, if they're unheedged,

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Speaker 11: have moved higher in tandem, and that's causing stress for

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Speaker 11: a subset of smaller issuers that don't have the pricing power,

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Speaker 11: they don't have the financial flexibility, perhaps they don't have

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Speaker 11: the refinancing options, and so they're added disadvantage. Now that's

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Speaker 11: not a common subset throughout the best maturity of the market,

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Speaker 11: but for the small nswers that will be stressed.

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Speaker 1: Is commercial real estate, either actual or securitized. Is commercial

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Speaker 1: real estate and opportunity are just a massive weight for

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Speaker 1: the washout.

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Speaker 11: The way that we're viewing it, is another reason for

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Speaker 11: banks to be more selective in lending. So, as you know,

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Speaker 11: it's a more than five point five trillion dollar market,

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Speaker 11: banks both small and large, own roughly half of that,

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Speaker 11: and I think it will take some time for the

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Speaker 11: price to discuss process to play through. You know, it's

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Speaker 11: reasonable to think that metrics that we used in past cycles,

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Speaker 11: like LTVs, like cap rates may not be as relevant

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Speaker 11: in this cycle given the significant change in prices that

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Speaker 11: we've seen, and also given the interest rate volatility, and

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Speaker 11: so I think it will take some time for investors

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Speaker 11: to get clarity on the macro which determines the cash

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Speaker 11: flows of those assets, and then also to figure out

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Speaker 11: where the real bottom exists in price discovery. That's probably

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Speaker 11: going to take longer to play out than, for example,

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Speaker 11: the stresses that we might see in the corporate credit

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Speaker 11: market among those smaller issuers. But it's something that we're

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Speaker 11: definitely wanting because it's so interest rate sensitive. I think

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Speaker 11: the real point, though, Tom, is that just like commercial

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Speaker 11: real estate can't be painted with a broad brush, all

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Speaker 11: cre is not created equal.

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Speaker 7: Office we think is perhaps the most vulnerable.

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Speaker 11: Similarly, in the corporate credit market, quality means much more

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Speaker 11: than ratings. It's really nuanced it means pricing power, refin

440
00:21:00,080 --> 00:21:04,359
Speaker 11: dancing options, business model resilience, and those are really things

441
00:21:04,359 --> 00:21:07,040
Speaker 11: that I think will be increasingly important in the second

442
00:21:07,080 --> 00:21:09,640
Speaker 11: half of the year because the fact of the matter

443
00:21:09,720 --> 00:21:11,600
Speaker 11: is that we didn't make as much progress on taming

444
00:21:11,880 --> 00:21:15,360
Speaker 11: inflation as we liked. There's probably upside risk to policy

445
00:21:15,440 --> 00:21:17,919
Speaker 11: rates a higher cost of capital environment, and so we

446
00:21:17,960 --> 00:21:21,639
Speaker 11: need to tread carefully when we think about what companies

447
00:21:21,720 --> 00:21:25,080
Speaker 11: and sectors and asset classes are best positioned for that environment.

448
00:21:25,200 --> 00:21:27,440
Speaker 3: And the upside risk to policy rates is what people

449
00:21:27,480 --> 00:21:29,639
Speaker 3: are focused on when they listen to Fedho J. Powell

450
00:21:29,680 --> 00:21:32,280
Speaker 3: as he takes the seed on Capitol Hill in about

451
00:21:32,280 --> 00:21:34,840
Speaker 3: two and a half hours from your vantage point, you say,

452
00:21:34,840 --> 00:21:37,920
Speaker 3: it's more important how long rates remain high. When does

453
00:21:37,960 --> 00:21:40,480
Speaker 3: it start to bite the most one of the maturity

454
00:21:40,520 --> 00:21:42,480
Speaker 3: walls the most painful, and you start to see the

455
00:21:42,480 --> 00:21:45,320
Speaker 3: interest rate sensitivity really come to the foe.

456
00:21:45,760 --> 00:21:48,720
Speaker 11: Yeah, so we've seen some early signs of that in

457
00:21:48,760 --> 00:21:51,359
Speaker 11: the default rate, but I would say at current levels

458
00:21:51,359 --> 00:21:54,399
Speaker 11: the default rate is still pretty well contained relative to

459
00:21:54,440 --> 00:21:57,440
Speaker 11: the history. There's probably some upside risk to that. I

460
00:21:57,480 --> 00:22:00,720
Speaker 11: think when the twenty twenty five maturity wall really become

461
00:22:00,760 --> 00:22:04,960
Speaker 11: an issue is twelve months prior to those bond maturities,

462
00:22:04,960 --> 00:22:07,360
Speaker 11: because for a host of reasons, we know that highield

463
00:22:07,440 --> 00:22:11,399
Speaker 11: corporates in particular don't like to let their maturities become

464
00:22:11,520 --> 00:22:15,000
Speaker 11: current on their balance sheet because has implications for the

465
00:22:15,080 --> 00:22:18,560
Speaker 11: year end audit and going concern language. And so even

466
00:22:18,600 --> 00:22:21,160
Speaker 11: though twenty twenty five seems far off in the distance,

467
00:22:21,400 --> 00:22:23,760
Speaker 11: it's actually not that far off if you think that

468
00:22:23,800 --> 00:22:26,040
Speaker 11: corporates will start to address that in twenty twenty four.

469
00:22:26,359 --> 00:22:29,520
Speaker 11: One really interesting point, and I don't think that this

470
00:22:29,640 --> 00:22:35,159
Speaker 11: favorable technical will persist. The magnitude of high yield supply

471
00:22:35,840 --> 00:22:39,639
Speaker 11: and the purpose of highyield supply has been incredibly bondholder

472
00:22:39,760 --> 00:22:42,760
Speaker 11: friendly so far here today, it's kind of the best

473
00:22:42,760 --> 00:22:44,600
Speaker 11: of both worlds. We haven't had a lot of high

474
00:22:44,640 --> 00:22:47,000
Speaker 11: old supply, and the supply that we've had has been

475
00:22:47,119 --> 00:22:50,960
Speaker 11: used for bondholder friendly needs like refinancing and debt repayment.

476
00:22:51,240 --> 00:22:54,800
Speaker 11: As we get closer to those maturity walls, that volume

477
00:22:54,840 --> 00:22:58,240
Speaker 11: of supply likely picks up, and so that favorable technical

478
00:22:58,320 --> 00:23:01,280
Speaker 11: has probably been an anchor for kyld spreads. Frankly, yere

479
00:23:01,320 --> 00:23:03,880
Speaker 11: today will probably ease up a bit and so that's

480
00:23:03,880 --> 00:23:06,120
Speaker 11: something certainly to watch as we get closer to those

481
00:23:06,119 --> 00:23:08,440
Speaker 11: maturity walls. But yes, Lisa, to your point, I mean

482
00:23:08,560 --> 00:23:11,919
Speaker 11: the length of time and the willingness, as you alluded

483
00:23:11,960 --> 00:23:14,320
Speaker 11: to earlier in the program, for the FED to really

484
00:23:14,400 --> 00:23:17,720
Speaker 11: stay the course and keep rates in restrictive territory or

485
00:23:17,760 --> 00:23:21,320
Speaker 11: even move them higher, is really the key consideration for

486
00:23:21,400 --> 00:23:22,439
Speaker 11: corporate credit quality.

487
00:23:22,680 --> 00:23:25,280
Speaker 1: Avanda. Thank you, Amanda. Aligning with us with black Rock

488
00:23:25,359 --> 00:23:31,280
Speaker 1: this morning, I'm going to talk China here at least

489
00:23:31,359 --> 00:23:34,159
Speaker 1: is all fired up to talk to China with Greg Valier,

490
00:23:34,240 --> 00:23:36,119
Speaker 1: and that's the lead part of his note this morning's

491
00:23:36,200 --> 00:23:39,960
Speaker 1: chief policy strategist at AGF Investments.

492
00:23:40,520 --> 00:23:42,399
Speaker 2: But there's Eric Canter, Greg.

493
00:23:42,200 --> 00:23:46,480
Speaker 1: Valier, and you and I know he was absolutely flattened

494
00:23:46,600 --> 00:23:50,600
Speaker 1: in Republican politics of a good number of years ago.

495
00:23:51,080 --> 00:23:54,439
Speaker 1: Has a Republican Party changed it all since Eric Canner?

496
00:23:54,480 --> 00:23:56,600
Speaker 1: I mean to me, McCarthy's in the same place as

497
00:23:56,960 --> 00:23:59,880
Speaker 1: John Bayner, and there's an Eric Canter right now trying

498
00:23:59,880 --> 00:24:02,800
Speaker 1: to help McCarthy and he can't get anything done.

499
00:24:03,440 --> 00:24:06,479
Speaker 12: Yeah, I think the party has gotten more strident in

500
00:24:06,720 --> 00:24:09,600
Speaker 12: many respects in the House, which makes life, as we

501
00:24:09,640 --> 00:24:13,360
Speaker 12: all know, very difficult for McCarthy. I think the other

502
00:24:13,359 --> 00:24:16,960
Speaker 12: big story is China. And just a couple of comments quickly,

503
00:24:17,000 --> 00:24:20,560
Speaker 12: Tom on that the little progress they made in the

504
00:24:20,640 --> 00:24:25,400
Speaker 12: last few days was negated overnight with Joe Biden inexplicably

505
00:24:26,200 --> 00:24:28,800
Speaker 12: ripping into z I don't know why he did it.

506
00:24:29,240 --> 00:24:32,720
Speaker 12: And number two, I think that these stories out on

507
00:24:32,760 --> 00:24:36,320
Speaker 12: a military base or a spy base or a training

508
00:24:36,359 --> 00:24:42,080
Speaker 12: base in Cuba by the Chinese really is a serious,

509
00:24:42,119 --> 00:24:43,240
Speaker 12: serious issue.

510
00:24:43,600 --> 00:24:46,399
Speaker 1: I agree because you and I lived in I have

511
00:24:46,480 --> 00:24:50,480
Speaker 1: the clearest memories of my youth and the Cuban missile crisis.

512
00:24:50,480 --> 00:24:51,800
Speaker 2: But I would suggest.

513
00:24:51,400 --> 00:24:55,240
Speaker 1: Greg, there's not missiles involved here. It's going to be

514
00:24:55,480 --> 00:24:58,399
Speaker 1: X number of soldiers one hundred miles from Key West.

515
00:24:58,440 --> 00:25:02,119
Speaker 1: I get that tension, but can you really equate it

516
00:25:02,160 --> 00:25:07,280
Speaker 1: to a Cuban missile crisis of John Fitzgerald Kennedy fair point.

517
00:25:07,320 --> 00:25:10,159
Speaker 12: It's not as serious as nineteen sixty two. But at

518
00:25:10,200 --> 00:25:13,120
Speaker 12: the same time, it's going to give fodder the politicians

519
00:25:13,160 --> 00:25:16,040
Speaker 12: who don't like China in both parties, whether it's Chuck

520
00:25:16,080 --> 00:25:21,200
Speaker 12: Schumer or Kevin McCarthy, and both parties, China is not popular,

521
00:25:21,560 --> 00:25:24,840
Speaker 12: and I think this will simply add fuel to the fire.

522
00:25:25,440 --> 00:25:28,119
Speaker 12: To speak out against the Chinese.

523
00:25:27,600 --> 00:25:31,200
Speaker 3: Greg You mentioned Joe Biden inexplicably in your words going

524
00:25:31,240 --> 00:25:33,720
Speaker 3: after Jijinping. I'll reach you the actual comments. He was

525
00:25:33,720 --> 00:25:37,159
Speaker 3: speaking at a fundraiser last night, saying that the Chinese

526
00:25:37,240 --> 00:25:40,480
Speaker 3: leader had been blindsided by the spy balloon, saying he

527
00:25:40,520 --> 00:25:43,240
Speaker 3: didn't know it was there. That's what the great embarrassment

528
00:25:43,280 --> 00:25:46,960
Speaker 3: for dictators. Well, they don't know what happened, and that

529
00:25:47,119 --> 00:25:49,240
Speaker 3: was what really keyed off some of the concerns with

530
00:25:49,280 --> 00:25:52,679
Speaker 3: people calling that irresponsible and saying that really does heightened tensions.

531
00:25:53,160 --> 00:25:56,840
Speaker 3: What do you make of the why behind President Biden's comments.

532
00:25:57,240 --> 00:25:59,480
Speaker 3: Was this some sort of diplomatic foray or was this

533
00:25:59,480 --> 00:26:02,400
Speaker 3: another folk pa that's going to be sort of highlighted

534
00:26:02,600 --> 00:26:05,320
Speaker 3: as kind of emblematic of his presidency.

535
00:26:06,520 --> 00:26:08,359
Speaker 12: Well, first of all, Lisa, you've got to say, it

536
00:26:08,400 --> 00:26:12,040
Speaker 12: looked to me anyway that the balloon story had been buried.

537
00:26:12,080 --> 00:26:14,800
Speaker 12: I think we put that behind us three or four

538
00:26:14,880 --> 00:26:19,040
Speaker 12: days ago, and Biden resurrected it. So this could be

539
00:26:19,200 --> 00:26:22,640
Speaker 12: just part of a string of gas we've seen recently

540
00:26:22,840 --> 00:26:25,840
Speaker 12: by Biden. After one speech last week he said, God

541
00:26:25,920 --> 00:26:29,200
Speaker 12: Save the Queen. There's things that he says that leave

542
00:26:29,240 --> 00:26:32,240
Speaker 12: people scratching their heads, and it could be serious for

543
00:26:32,280 --> 00:26:35,520
Speaker 12: a second, it does plant seeds of doubt among a

544
00:26:35,520 --> 00:26:38,680
Speaker 12: lot of Democrats who are reluctant to vote for him.

545
00:26:39,080 --> 00:26:41,600
Speaker 3: Well, just putting aside the election for one second and

546
00:26:41,640 --> 00:26:43,960
Speaker 3: just doubling down the theme, do you actually think that

547
00:26:44,000 --> 00:26:47,639
Speaker 3: this could materially worsen relations with Tina? That the relationship

548
00:26:47,680 --> 00:26:51,000
Speaker 3: is already so fragile that a gaff by the President

549
00:26:51,359 --> 00:26:54,600
Speaker 3: just simply mentioning the word dictator could undermine everything that

550
00:26:54,640 --> 00:26:57,160
Speaker 3: Tony blinkn accomplished while he was overseas.

551
00:26:57,960 --> 00:27:01,360
Speaker 12: Well, it doesn't help, does it. It makes things more complicated.

552
00:27:01,440 --> 00:27:04,440
Speaker 12: And I'm sure you've just as you have angry lawyers

553
00:27:04,520 --> 00:27:07,560
Speaker 12: working for Donald Trump or shaking their head over Trump's

554
00:27:07,560 --> 00:27:10,719
Speaker 12: interview with Bret Baher, you see a lot of people,

555
00:27:10,920 --> 00:27:14,200
Speaker 12: I'm sure close to Blincoln shaking their heads over why

556
00:27:14,240 --> 00:27:17,320
Speaker 12: Biden would say something that to me reckless?

557
00:27:17,680 --> 00:27:19,840
Speaker 2: Greg, What do we follow into July?

558
00:27:20,560 --> 00:27:22,560
Speaker 1: I mean, I think for so much of our audience,

559
00:27:22,600 --> 00:27:25,960
Speaker 1: we're exhausted by this story, this story. We glance at

560
00:27:25,960 --> 00:27:29,000
Speaker 1: the Post, glance at the Times, glance at Bloomberg, politics, etc.

561
00:27:29,800 --> 00:27:31,920
Speaker 1: But what's the thing to follow into July.

562
00:27:33,040 --> 00:27:36,320
Speaker 12: Well, we've got today, as you know, we've got jerown Powell.

563
00:27:36,560 --> 00:27:39,640
Speaker 12: But I would say throughout the summer the number one

564
00:27:39,720 --> 00:27:43,480
Speaker 12: story is Ukraine. If this war doesn't go well and

565
00:27:43,720 --> 00:27:46,520
Speaker 12: they got off to a fairly slow start, I think

566
00:27:46,520 --> 00:27:49,320
Speaker 12: it'll lead to a lot of anxiety that the West

567
00:27:49,480 --> 00:27:52,280
Speaker 12: and the US may lighten up on our aid. We're

568
00:27:52,320 --> 00:27:54,520
Speaker 12: not at that point yet. I think that this is

569
00:27:54,560 --> 00:27:57,359
Speaker 12: still a winnable war, but I think there's got to

570
00:27:57,359 --> 00:27:59,560
Speaker 12: be signs of progress. So to me, that is the

571
00:27:59,720 --> 00:28:01,560
Speaker 12: story for the rest of the summer.

572
00:28:01,600 --> 00:28:03,879
Speaker 1: I want to take the military and it's effort in Ukraine,

573
00:28:03,920 --> 00:28:06,119
Speaker 1: swing it back to the Pacific ring Greg Value and

574
00:28:06,160 --> 00:28:08,520
Speaker 1: one of the clear things we see is an expansion

575
00:28:08,560 --> 00:28:12,080
Speaker 1: of the United States military across a Pacific rim.

576
00:28:12,280 --> 00:28:14,120
Speaker 2: It seems to me to endure.

577
00:28:14,320 --> 00:28:18,800
Speaker 1: It's not only a discussion, it's now being budgeted and planned.

578
00:28:18,880 --> 00:28:19,719
Speaker 2: Is that how you see it?

579
00:28:20,800 --> 00:28:21,000
Speaker 13: Yeah?

580
00:28:21,040 --> 00:28:23,520
Speaker 12: I think so. There's going to be controversy in the

581
00:28:23,560 --> 00:28:26,000
Speaker 12: House on how much we're going to spend on Ukraine

582
00:28:26,000 --> 00:28:29,240
Speaker 12: and the budget, and I would say the number two

583
00:28:29,280 --> 00:28:31,880
Speaker 12: issue for the next two or three months will be budget.

584
00:28:32,240 --> 00:28:34,160
Speaker 12: And I don't want to sound like the little boy

585
00:28:34,200 --> 00:28:36,880
Speaker 12: who cried Wilf. But I think chances of a government

586
00:28:36,920 --> 00:28:39,800
Speaker 12: shut down on October one are a little bit above

587
00:28:40,000 --> 00:28:42,640
Speaker 12: fifty to fifty, so that's going to be a big deal.

588
00:28:42,680 --> 00:28:44,719
Speaker 12: I think at the end of the day, the defense

589
00:28:44,800 --> 00:28:47,800
Speaker 12: industry and Ukraine get plenty of money from the US.

590
00:28:48,360 --> 00:28:48,720
Speaker 13: We know that.

591
00:28:48,880 --> 00:28:50,920
Speaker 3: Just to double down what you're talking about with respect

592
00:28:50,920 --> 00:28:52,960
Speaker 3: to Ukraine and that you think that's going to be

593
00:28:53,000 --> 00:28:56,200
Speaker 3: the key worry. Are you expecting to hear exactly what

594
00:28:56,240 --> 00:28:59,440
Speaker 3: the progress is how Ukraine is defending against a Russian

595
00:28:59,480 --> 00:29:02,760
Speaker 3: offensive that, by a number of reports is getting perhaps

596
00:29:02,920 --> 00:29:06,040
Speaker 3: a bit perhaps more savvy. How much are you looking

597
00:29:06,120 --> 00:29:09,760
Speaker 3: for intel from the Rebuild Ukraine conference currently ongoing.

598
00:29:11,000 --> 00:29:13,200
Speaker 12: Well, of course, as we all know, the first casualty

599
00:29:13,240 --> 00:29:17,680
Speaker 12: of war is the truth, so it's hard to discern

600
00:29:17,760 --> 00:29:20,120
Speaker 12: what is true and what isn't. I just think this

601
00:29:20,160 --> 00:29:22,440
Speaker 12: is going to be a long slog I think people

602
00:29:22,520 --> 00:29:27,080
Speaker 12: were unrealistic thinking that the Ukrainians were just romped during June.

603
00:29:27,240 --> 00:29:29,520
Speaker 12: Well they haven't, but we still have a long way

604
00:29:29,520 --> 00:29:30,360
Speaker 12: to go this summer.

605
00:29:30,600 --> 00:29:34,000
Speaker 1: Greigvillier, thank you so much, greatly appreciate it. With AGF investments.

606
00:29:44,400 --> 00:29:47,720
Speaker 1: There is a movie it is called North Side seven

607
00:29:47,880 --> 00:29:51,520
Speaker 1: seven seven. It is of a Chicago long ago. Jimmy

608
00:29:51,520 --> 00:29:55,280
Speaker 1: Stewart takes a lens and is fabulous in that movie

609
00:29:55,800 --> 00:29:59,520
Speaker 1: until halfway through you realize there's an old lady on

610
00:29:59,560 --> 00:30:03,040
Speaker 1: her knee. He's at the Wriggly Building taking the movie,

611
00:30:03,200 --> 00:30:05,960
Speaker 1: stealing the movie from Jimmy Stewart. And of course that

612
00:30:06,120 --> 00:30:11,080
Speaker 1: is the iconic grandmother and mother within called Northside seven seven.

613
00:30:11,840 --> 00:30:15,400
Speaker 1: This is an extraordinary book. I really don't know what

614
00:30:15,480 --> 00:30:18,680
Speaker 1: to say Jenny Rametti Romedy, as you know, it's the

615
00:30:18,720 --> 00:30:23,800
Speaker 1: most mispronounced name in corporately. Well, Jenny Romedy with us

616
00:30:23,840 --> 00:30:27,560
Speaker 1: this morning on a hugely courageous book. And I want

617
00:30:27,560 --> 00:30:31,760
Speaker 1: to start with the blistering first fifty pages of your childhood.

618
00:30:32,160 --> 00:30:33,760
Speaker 2: And Baba came to the rescue.

619
00:30:33,800 --> 00:30:37,880
Speaker 14: Who was Baba my great grandmother? And you're right, and

620
00:30:38,040 --> 00:30:40,560
Speaker 14: you speak of the Wriggly Building, because I was raised

621
00:30:40,560 --> 00:30:42,240
Speaker 14: by really strong women who.

622
00:30:42,040 --> 00:30:43,560
Speaker 6: All suffered great tragedies.

623
00:30:44,120 --> 00:30:47,080
Speaker 14: And that was my great grandmother who came here from Belarus,

624
00:30:47,120 --> 00:30:50,040
Speaker 14: the last person alive from her family, who worked third

625
00:30:50,040 --> 00:30:52,560
Speaker 14: shift in the Wriggly Building, cleaning bathrooms, never spoke a

626
00:30:52,600 --> 00:30:56,280
Speaker 14: stitch of English English, and saved every diamond us savings

627
00:30:56,320 --> 00:30:58,960
Speaker 14: bonds and one day it would would allow us to

628
00:30:58,960 --> 00:30:59,440
Speaker 14: have a car.

629
00:30:59,600 --> 00:31:01,080
Speaker 2: What was the first day?

630
00:31:01,240 --> 00:31:05,840
Speaker 1: Like at Northwestern there were fancy people from New triermutants

631
00:31:05,920 --> 00:31:06,480
Speaker 1: from New.

632
00:31:06,400 --> 00:31:09,720
Speaker 6: Jas you know that. And there I was, Yes, there

633
00:31:09,760 --> 00:31:10,080
Speaker 6: I was.

634
00:31:10,200 --> 00:31:12,920
Speaker 14: No I I was there, by the grace of God right,

635
00:31:13,040 --> 00:31:16,520
Speaker 14: just lucky enough to get a scholarship. And what I

636
00:31:16,560 --> 00:31:18,520
Speaker 14: what I remember is having gone to the store and

637
00:31:18,520 --> 00:31:22,280
Speaker 14: bought one pair of Jeanes and topsiders.

638
00:31:21,560 --> 00:31:24,280
Speaker 6: To try to fit in a slide rule. I did

639
00:31:24,360 --> 00:31:25,080
Speaker 6: use a slide rule.

640
00:31:25,280 --> 00:31:28,160
Speaker 1: You're dating this is like a nerd. Yes, go to

641
00:31:28,200 --> 00:31:30,800
Speaker 1: the woman from Chicago, wouldn't know a slide rule if

642
00:31:30,840 --> 00:31:31,760
Speaker 1: it hit over the world.

643
00:31:31,920 --> 00:31:34,720
Speaker 3: From a slide role to today, it's actually an appropriate

644
00:31:34,880 --> 00:31:37,920
Speaker 3: kind of pathway at a time. Win Tech is at

645
00:31:37,960 --> 00:31:40,440
Speaker 3: the epicenter of how to get from the slide rule

646
00:31:40,600 --> 00:31:44,640
Speaker 3: to the graphic calculator and beyond right, how much can

647
00:31:44,680 --> 00:31:47,080
Speaker 3: you see some of the lessons that you learned at

648
00:31:47,080 --> 00:31:50,160
Speaker 3: the helm of IBM of how to bring a company

649
00:31:50,320 --> 00:31:53,560
Speaker 3: up to speed with technology that moves more quickly than

650
00:31:53,600 --> 00:31:54,440
Speaker 3: anyone could imagine.

651
00:31:54,480 --> 00:31:56,720
Speaker 14: Yeah, this is it's timely because even though the book

652
00:31:56,760 --> 00:31:59,040
Speaker 14: took me two years to write, Good Power there's a

653
00:31:59,040 --> 00:32:02,080
Speaker 14: whole section in it on it A because a decade

654
00:32:02,120 --> 00:32:04,720
Speaker 14: ago I spent quite a bit of time trying to

655
00:32:04,720 --> 00:32:07,160
Speaker 14: bring AI into the world to solve really tough problems.

656
00:32:07,200 --> 00:32:10,240
Speaker 14: And here we are now, and to me, the things

657
00:32:10,240 --> 00:32:13,200
Speaker 14: I learned. Everybody wants to talk about the technology, this

658
00:32:13,240 --> 00:32:15,520
Speaker 14: is going to be a people and a trust problem.

659
00:32:15,760 --> 00:32:18,520
Speaker 6: That is what I learned from all these years.

660
00:32:18,280 --> 00:32:21,280
Speaker 14: And that you know, with something like AI, I see

661
00:32:21,280 --> 00:32:23,440
Speaker 14: it as two sides of one coin, and if we

662
00:32:23,440 --> 00:32:25,840
Speaker 14: don't manage the good and the bad at the same time,

663
00:32:26,320 --> 00:32:27,440
Speaker 14: we're going to have trouble.

664
00:32:27,520 --> 00:32:29,920
Speaker 3: When you look back on your legacy at IBM and

665
00:32:29,960 --> 00:32:32,479
Speaker 3: you think about some of the advancements that perhaps were

666
00:32:32,480 --> 00:32:34,680
Speaker 3: shrugged off at the outset, whether it was cloud computing

667
00:32:34,760 --> 00:32:36,760
Speaker 3: or some of the others, what would you do differently,

668
00:32:36,840 --> 00:32:40,400
Speaker 3: or how do you understand what to identify as something

669
00:32:40,400 --> 00:32:44,400
Speaker 3: that holds promise versus the next you false hope that

670
00:32:44,400 --> 00:32:45,320
Speaker 3: everyone's going to cling to.

671
00:32:45,600 --> 00:32:48,760
Speaker 14: Yeah, look, I think this is difficult. It's difficult because

672
00:32:48,840 --> 00:32:51,280
Speaker 14: actually many of the bets we placed were correct. Some

673
00:32:51,480 --> 00:32:54,920
Speaker 14: timing was not exactly right on those. But today everything

674
00:32:54,960 --> 00:32:57,440
Speaker 14: we did around AI and now it's hybrid cloud is

675
00:32:57,480 --> 00:33:01,000
Speaker 14: what the company is really growing from. So the idea

676
00:33:01,000 --> 00:33:02,880
Speaker 14: when you run a company, and IBM's the oldest tech

677
00:33:02,920 --> 00:33:04,800
Speaker 14: company and clearly I had to lead it through its

678
00:33:04,800 --> 00:33:08,600
Speaker 14: most tumultuous reinvention, is that you've just got to make

679
00:33:08,600 --> 00:33:10,960
Speaker 14: those decisions for the long term, even if you may

680
00:33:11,000 --> 00:33:12,600
Speaker 14: not see them play out during your tenure.

681
00:33:12,800 --> 00:33:15,920
Speaker 1: For joining us on radio and television, good power. I

682
00:33:15,960 --> 00:33:18,680
Speaker 1: can't say enough about it. It's summer read thin. This

683
00:33:18,840 --> 00:33:22,440
Speaker 1: is great but very dense. Two hundred and thirty pages

684
00:33:22,480 --> 00:33:26,239
Speaker 1: here on a life story that's extraordinary and also the

685
00:33:26,240 --> 00:33:28,400
Speaker 1: realities of IBM. I'm going to address it. You've been

686
00:33:28,560 --> 00:33:32,200
Speaker 1: You've had critics like a Pinata here on the transformation

687
00:33:32,280 --> 00:33:34,600
Speaker 1: of I've been moved. I want to get to Gersner

688
00:33:34,640 --> 00:33:36,440
Speaker 1: in a minute. But the way you used to read

689
00:33:36,480 --> 00:33:38,680
Speaker 1: the statement from Sam Palmisano as you looked at the

690
00:33:38,680 --> 00:33:40,920
Speaker 1: free cash flow on page two of the on your

691
00:33:40,960 --> 00:33:42,680
Speaker 1: report and you said, IBM to the moon.

692
00:33:43,160 --> 00:33:46,120
Speaker 2: What happened? How did Palmisano get this so wrong?

693
00:33:46,240 --> 00:33:48,280
Speaker 14: Look, I mean what we had done, we had done

694
00:33:48,440 --> 00:33:50,959
Speaker 14: very well to a certain point. But then the world changed.

695
00:33:51,040 --> 00:33:51,880
Speaker 2: The world changed.

696
00:33:51,960 --> 00:33:53,920
Speaker 14: There was there was not just one tech trend, there

697
00:33:53,960 --> 00:33:57,160
Speaker 14: was cloud there was data, there was AI, mobility, social media,

698
00:33:57,600 --> 00:33:58,760
Speaker 14: and that's five tracks.

699
00:33:58,920 --> 00:34:02,880
Speaker 1: Now the meetings was it? Did you blame mackenzie? Did

700
00:34:02,880 --> 00:34:05,680
Speaker 1: you bring in consultants who screwed this up? Why did

701
00:34:05,760 --> 00:34:09,240
Speaker 1: you have such an inertial force where you couldn't change faster?

702
00:34:09,440 --> 00:34:11,640
Speaker 14: Yeah, I think Wich always had. When you're an incumbnent

703
00:34:11,719 --> 00:34:14,600
Speaker 14: in something, it is both you're trying to protect them

704
00:34:14,680 --> 00:34:15,719
Speaker 14: and not just protect a pass.

705
00:34:15,719 --> 00:34:17,000
Speaker 6: You've got customers that you've.

706
00:34:16,880 --> 00:34:18,520
Speaker 14: Got to serve, yet you've got to move to the

707
00:34:18,520 --> 00:34:21,440
Speaker 14: future at the same time. And so that realized how

708
00:34:21,480 --> 00:34:23,440
Speaker 14: every one of us had a challenge, and mine was

709
00:34:23,520 --> 00:34:27,160
Speaker 14: to now prepare a whole new technology portfolio for the future.

710
00:34:27,400 --> 00:34:30,000
Speaker 14: But I had a double sort of challenge in that

711
00:34:30,080 --> 00:34:32,839
Speaker 14: I also had to reskill the workforce, and so when

712
00:34:32,840 --> 00:34:36,040
Speaker 14: I began, folks weren't prepared for future skills.

713
00:34:36,080 --> 00:34:37,759
Speaker 1: It's de late in the book, You're phenomenal on this.

714
00:34:37,880 --> 00:34:39,720
Speaker 1: You go to Brian Moyne at a Bank of America,

715
00:34:39,760 --> 00:34:41,800
Speaker 1: who's an animal. I mean, I love you know, Brian,

716
00:34:41,880 --> 00:34:44,640
Speaker 1: you go, what's the FED gonna do? Belowning he's a

717
00:34:44,680 --> 00:34:48,040
Speaker 1: bank animal. He knows the deposit flows in Kansas City,

718
00:34:48,280 --> 00:34:51,239
Speaker 1: and he talks about hiring for skill. Yeah, does that

719
00:34:51,280 --> 00:34:52,600
Speaker 1: mean you only hire engineers?

720
00:34:52,719 --> 00:34:52,959
Speaker 6: Yeah.

721
00:34:53,000 --> 00:34:56,239
Speaker 14: Look, this is something that I work passionately on now,

722
00:34:56,280 --> 00:34:58,400
Speaker 14: this idea to hire for people for their skills, not

723
00:34:58,560 --> 00:35:01,319
Speaker 14: just their degrees. I I came to it having had

724
00:35:01,320 --> 00:35:03,479
Speaker 14: a mother. You know, I was abandoned as a kid

725
00:35:03,800 --> 00:35:06,880
Speaker 14: and my mother had no education. So but I quickly

726
00:35:06,920 --> 00:35:10,160
Speaker 14: saw access and aptitude were not equal, meaning she had

727
00:35:10,200 --> 00:35:12,040
Speaker 14: aptitude no access to education.

728
00:35:12,400 --> 00:35:14,400
Speaker 6: So she got a little bit of education and.

729
00:35:14,360 --> 00:35:16,200
Speaker 14: Can get an hourly job, a little more, a little

730
00:35:16,200 --> 00:35:18,520
Speaker 14: better job to get us off of things like food stamps.

731
00:35:18,920 --> 00:35:22,240
Speaker 14: Fast forward, I would be searching for people like cyber

732
00:35:22,640 --> 00:35:25,520
Speaker 14: They're not in the marketplace. In twenty twelve, we'd start

733
00:35:25,560 --> 00:35:29,040
Speaker 14: to work with community colleges and high schools, and I'd say,

734
00:35:29,040 --> 00:35:31,240
Speaker 14: why aren't we hiring these people? They can do the job.

735
00:35:31,480 --> 00:35:34,400
Speaker 14: Will one hundred percent of our requirements are college degrees,

736
00:35:34,840 --> 00:35:37,120
Speaker 14: and it would lead me down this path for really, now,

737
00:35:37,160 --> 00:35:40,320
Speaker 14: almost two decades of a movement, I think it's essential

738
00:35:40,320 --> 00:35:43,960
Speaker 14: to democracy in this country that we revisit. Having found

739
00:35:44,000 --> 00:35:47,319
Speaker 14: fifty percent of our jobs were over credentialed, requiring a

740
00:35:47,360 --> 00:35:50,000
Speaker 14: degree to start when you didn't need one to start.

741
00:35:50,040 --> 00:35:53,200
Speaker 14: This idea that where you start shouldn't determine where you end.

742
00:35:53,320 --> 00:35:54,840
Speaker 6: That skills first, you.

743
00:35:54,960 --> 00:35:57,120
Speaker 3: Join the show at a really important point, and you're

744
00:35:57,120 --> 00:35:59,239
Speaker 3: an important voice at a time where we talk so

745
00:35:59,360 --> 00:36:02,239
Speaker 3: much about and how much that's a divergent story from

746
00:36:02,239 --> 00:36:04,680
Speaker 3: the rest of the economy. Do you think that the

747
00:36:04,719 --> 00:36:07,799
Speaker 3: big tech names that have really become the behemoths are

748
00:36:07,840 --> 00:36:12,600
Speaker 3: doing a good job managing the technological trends, managing to

749
00:36:12,680 --> 00:36:16,040
Speaker 3: train people in the appropriate ways, and creating a path

750
00:36:16,120 --> 00:36:17,880
Speaker 3: for a longer type of trajectory.

751
00:36:18,200 --> 00:36:19,479
Speaker 6: Let me answer that two ways.

752
00:36:19,520 --> 00:36:21,319
Speaker 14: One is there's a whole chapter of what I call

753
00:36:21,400 --> 00:36:24,200
Speaker 14: stort in good tech, and it isn't just the tech companies.

754
00:36:24,200 --> 00:36:27,040
Speaker 14: It's now all of us and has much efforts got

755
00:36:27,120 --> 00:36:30,040
Speaker 14: to be put on preparing people to see a better

756
00:36:30,080 --> 00:36:31,520
Speaker 14: future because of this technology.

757
00:36:31,719 --> 00:36:33,560
Speaker 6: I mean, my biggest learning with trying.

758
00:36:33,320 --> 00:36:36,359
Speaker 14: To roll out AI, particular with professional people, they don't

759
00:36:36,400 --> 00:36:39,600
Speaker 14: trust it. They unless they're part of its co creation

760
00:36:39,719 --> 00:36:42,480
Speaker 14: and how it's used, won't use it. So as you

761
00:36:42,520 --> 00:36:45,520
Speaker 14: go forward, now this is about reskilling, not just your

762
00:36:45,560 --> 00:36:48,000
Speaker 14: current workers. You know it will be multiple times in

763
00:36:48,040 --> 00:36:50,960
Speaker 14: our lifetime once and done. Education is over now, and

764
00:36:51,040 --> 00:36:54,319
Speaker 14: so that idea that. I think that side of the

765
00:36:54,320 --> 00:36:57,920
Speaker 14: coin about preparing the workforce is totally not paid attention

766
00:36:57,960 --> 00:37:00,799
Speaker 14: to right now, and to me, that is the biggest thing.

767
00:37:00,840 --> 00:37:04,040
Speaker 14: And second is is really getting people to trust the technology.

768
00:37:04,920 --> 00:37:06,480
Speaker 14: You know, I had a lot of experience with a

769
00:37:06,480 --> 00:37:09,640
Speaker 14: big company with a big brand, and when you introduce AI,

770
00:37:10,040 --> 00:37:12,759
Speaker 14: there's very little tolerance for it to be wrong. When

771
00:37:12,800 --> 00:37:15,600
Speaker 14: you're a big company, a startup, no problem. But when

772
00:37:15,640 --> 00:37:18,520
Speaker 14: you start using it for health financial services, you're in

773
00:37:18,560 --> 00:37:21,000
Speaker 14: a whole different ballgame with how people react to it.

774
00:37:21,239 --> 00:37:23,840
Speaker 14: So that issue of trust and preparing people are what

775
00:37:23,920 --> 00:37:26,160
Speaker 14: I think is not being acted on enough.

776
00:37:26,280 --> 00:37:28,080
Speaker 1: I'm out of time, but I got to squeeze this in.

777
00:37:28,160 --> 00:37:30,840
Speaker 1: I got fourteen more questions. I got time for one question.

778
00:37:31,280 --> 00:37:35,960
Speaker 1: What was the best practice of lou gersnerh My?

779
00:37:36,360 --> 00:37:38,080
Speaker 14: You know I you know I have a men's respect

780
00:37:38,080 --> 00:37:39,640
Speaker 14: for low and to this day is a very good

781
00:37:39,680 --> 00:37:42,680
Speaker 14: friend of mine. I think he was a brilliant both

782
00:37:42,719 --> 00:37:46,000
Speaker 14: strategist and execution leader both sides of the coin.

783
00:37:46,320 --> 00:37:48,080
Speaker 2: He got his hands dirty issues.

784
00:37:48,000 --> 00:37:51,759
Speaker 6: Absolutely and to this day this is a gospel to me. Yes, absolutely,

785
00:37:52,040 --> 00:37:52,920
Speaker 6: You and I share.

786
00:37:52,719 --> 00:37:54,840
Speaker 1: Nothing on the show. Everybody puts it together for me,

787
00:37:54,880 --> 00:37:55,480
Speaker 1: I just show up.

788
00:37:55,600 --> 00:37:58,719
Speaker 14: No, No, we share that admiration. He is able to simplify

789
00:37:58,760 --> 00:38:00,279
Speaker 14: the complex and an amazing way.

790
00:38:00,719 --> 00:38:04,040
Speaker 1: This is a great book, Good Power, leading positive change

791
00:38:04,080 --> 00:38:08,160
Speaker 1: in our life's work in world. The first fifty pages

792
00:38:09,040 --> 00:38:10,000
Speaker 1: is blistering.

793
00:38:10,080 --> 00:38:12,799
Speaker 2: There's no other way to put it anything. I'm not

794
00:38:12,840 --> 00:38:14,040
Speaker 2: going to pronounce your last name.

795
00:38:14,280 --> 00:38:22,880
Speaker 6: That's all right, joins us.

796
00:38:22,880 --> 00:38:24,240
Speaker 2: Good Power here this morning.

797
00:38:24,480 --> 00:38:28,319
Speaker 1: Subscribe to the Bloomberg Surveillance Podcast on Apple, Spotify, and

798
00:38:28,440 --> 00:38:32,640
Speaker 1: anywhere else you get your podcasts. Listen live every weekday

799
00:38:32,920 --> 00:38:36,400
Speaker 1: starting at seven am Eastern on Bloomberg dot Com, the

800
00:38:36,520 --> 00:38:38,880
Speaker 1: iHeartRadio app, tune In.

801
00:38:39,040 --> 00:38:40,480
Speaker 2: And the Bloomberg Business app.

802
00:38:40,960 --> 00:38:44,600
Speaker 1: You can watch us live on Bloomberg Television and always

803
00:38:45,000 --> 00:38:48,880
Speaker 1: on the Bloomberg Terminal. Thanks for listening. I'm Tom Keane,

804
00:38:49,040 --> 00:39:00,520
Speaker 1: and this is Bloomberg. Thanks for listening to the Bloomberg

805
00:39:00,560 --> 00:39:05,120
Speaker 1: Surveillance Podcast. Now, stay tuned for today's edition of Bloomberg Daybreak.

806
00:39:05,160 --> 00:39:08,960
Speaker 1: It's your daily news podcast, delivering today's top stories to

807
00:39:09,040 --> 00:39:12,480
Speaker 1: your podcast feed by six am Eastern. It's all the

808
00:39:12,520 --> 00:39:17,480
Speaker 1: news you need in just fifteen minutes. The Bloomberg Daybreak Podcast.

809
00:39:17,680 --> 00:39:21,840
Speaker 1: It starts right now.

810
00:39:20,560 --> 00:39:24,080
Speaker 10: From the Bloomberg Interactive Burgers Studios is Bloomberg day Break

811
00:39:24,120 --> 00:39:26,880
Speaker 10: for Wednesday, June twenty. First coming up today, A.

812
00:39:26,960 --> 00:39:29,960
Speaker 15: Hopeful sound noises are detected in the search for the

813
00:39:30,040 --> 00:39:31,719
Speaker 15: undersea vessel near the Titanic.

814
00:39:31,800 --> 00:39:34,960
Speaker 10: New tensions emerge with China after President Biden refers to

815
00:39:35,040 --> 00:39:36,880
Speaker 10: Shijin Ping as a dictator.

816
00:39:37,000 --> 00:39:37,719
Speaker 8: Fed Chair J.

817
00:39:37,960 --> 00:39:41,640
Speaker 15: Powell delivers his first day of congressional testimony this morning.

818
00:39:41,400 --> 00:39:45,320
Speaker 10: And FedEx does not deliver for investors with its latest earnings.

819
00:39:45,440 --> 00:39:49,200
Speaker 8: President Biden prepares for his state visit with India's Prime minister.

820
00:39:49,360 --> 00:39:52,120
Speaker 8: Plus New York State is banning employer's use of non

821
00:39:52,200 --> 00:39:55,200
Speaker 8: compete agreements. I'm Michael bar More Ahead.

822
00:39:54,920 --> 00:39:55,840
Speaker 2: I'm John Stansharon.

823
00:39:55,880 --> 00:39:58,120
Speaker 16: Sports Garrett Cole pitched the Yankees too much, be did

824
00:39:58,160 --> 00:40:00,919
Speaker 16: and win over Seattle, the Mets, and Justin Erlander lost

825
00:40:01,080 --> 00:40:01,600
Speaker 16: in Houston.

826
00:40:03,239 --> 00:40:06,680
Speaker 13: That's all straight Ahead on Bloomberg day Break, the business

827
00:40:06,680 --> 00:40:09,160
Speaker 13: news you need to start your day in just one

828
00:40:09,280 --> 00:40:13,759
Speaker 13: fifteen minute podcast each morning on Apple Spotify, the Bloomberg

829
00:40:13,800 --> 00:40:16,480
Speaker 13: Business Appen everywhere you get your podcasts.

830
00:40:19,440 --> 00:40:22,600
Speaker 10: Good morning, I'm Nathan Hager and I'm Karen Moscow. Here

831
00:40:22,640 --> 00:40:24,360
Speaker 10: are the stories we're following today.

832
00:40:25,400 --> 00:40:28,239
Speaker 15: We want to update you first on the missing submersible

833
00:40:28,320 --> 00:40:30,480
Speaker 15: near the wreckage of the Titanic and what may be

834
00:40:30,680 --> 00:40:34,680
Speaker 15: a hopeful sign. The Coastguard says underwater sounds have been detected.

835
00:40:35,040 --> 00:40:37,879
Speaker 15: Now search teams are being redirected to find out where

836
00:40:37,880 --> 00:40:41,080
Speaker 15: those sounds came from. Coast Guard Rear Admiral John Mager

837
00:40:41,120 --> 00:40:45,000
Speaker 15: says they're using planes, remotely operated vehicles, and underwater robots

838
00:40:45,040 --> 00:40:47,800
Speaker 15: to find the five people on board the titan.

839
00:40:47,680 --> 00:40:49,360
Speaker 2: It's a really complex case.

840
00:40:50,080 --> 00:40:55,000
Speaker 17: Their active debris field down on the bottom of the ocean,

841
00:40:55,600 --> 00:40:57,520
Speaker 17: and a lot of complexity of working at that time.

842
00:40:57,840 --> 00:41:01,200
Speaker 15: Rear Admiral John magertell's ABC News it's a race against time.

843
00:41:01,280 --> 00:41:03,640
Speaker 15: The titan is designed to carry up to ninety six

844
00:41:03,680 --> 00:41:05,880
Speaker 15: hours of oxygen. At this rate, the ship may have

845
00:41:06,000 --> 00:41:08,600
Speaker 15: less than twenty four hours of air left well.

846
00:41:08,600 --> 00:41:12,080
Speaker 10: Another major story that we're following this morning, Nathan, involves

847
00:41:12,120 --> 00:41:15,080
Speaker 10: the fallout from the plea deal for Hunter Biden. The

848
00:41:15,160 --> 00:41:18,239
Speaker 10: deal may help avoid a messy public trial and key

849
00:41:18,320 --> 00:41:21,680
Speaker 10: President Biden's son out of jail, but the agreement also

850
00:41:21,800 --> 00:41:26,080
Speaker 10: provides fodder for the president's political opponents. Bloomberg's Amy Morris

851
00:41:26,160 --> 00:41:28,560
Speaker 10: or Poorsermer ninety nine one newsroom in Washington.

852
00:41:28,960 --> 00:41:32,719
Speaker 18: Hunter Biden's legal troubles haven't stopped the President from supporting him.

853
00:41:32,920 --> 00:41:33,920
Speaker 2: Very proud of my son.

854
00:41:33,960 --> 00:41:36,920
Speaker 18: The Republicans are outraged with the deal, vowing to continue

855
00:41:36,920 --> 00:41:40,160
Speaker 18: their probes into the Biden family. Congressman James Comer is

856
00:41:40,280 --> 00:41:41,920
Speaker 18: chair of the House Oversight Committee.

857
00:41:41,960 --> 00:41:44,520
Speaker 19: This has absolutely nothing to do with our investigation of

858
00:41:44,880 --> 00:41:46,880
Speaker 19: Joe Biden, and we're going to continue to move forward

859
00:41:46,920 --> 00:41:47,120
Speaker 19: with that.

860
00:41:47,280 --> 00:41:50,439
Speaker 18: The Congressman Jamie Raskin, the top Democrat on that committee, says,

861
00:41:50,440 --> 00:41:53,240
Speaker 18: if there is a double standard, it's with the Trump family,

862
00:41:53,320 --> 00:41:53,920
Speaker 18: not Biden.

863
00:41:54,080 --> 00:41:57,240
Speaker 2: They should check out what happened with Jared Kushner.

864
00:41:57,560 --> 00:42:02,479
Speaker 12: He registered to create a newport, which promptly received two

865
00:42:02,680 --> 00:42:05,040
Speaker 12: billion dollars from the Saudi government.

866
00:42:05,120 --> 00:42:07,600
Speaker 18: Judge still has to approve the Plea deal, even as

867
00:42:07,640 --> 00:42:11,520
Speaker 18: the lead prosecutor says the investigation is ongoing. In Washington,

868
00:42:11,560 --> 00:42:13,520
Speaker 18: I Amy Moore as Bloomberg Daybreak.

869
00:42:13,200 --> 00:42:13,719
Speaker 2: Thank you, Amy.

870
00:42:13,760 --> 00:42:16,399
Speaker 15: While the rhetoric heats up between the parties over Hunter Widen,

871
00:42:16,480 --> 00:42:19,680
Speaker 15: intentions between the US and China may be rising again.

872
00:42:20,080 --> 00:42:23,680
Speaker 15: China says President Biden made a quote public political provocation

873
00:42:23,920 --> 00:42:27,759
Speaker 15: by referring to his counterpart, She Jinping as a dictator.

874
00:42:28,000 --> 00:42:30,960
Speaker 15: Biden told a California fundraiser that the Chinese leader had

875
00:42:31,000 --> 00:42:34,160
Speaker 15: been embarrassed by an alleged spy balloon because he didn't

876
00:42:34,200 --> 00:42:36,840
Speaker 15: know it was there. The President says, quote, that's the

877
00:42:36,840 --> 00:42:40,160
Speaker 15: great embarrassment for dictators when they didn't know what happened.

878
00:42:40,840 --> 00:42:43,360
Speaker 10: Well, turning to the markets now, Nathan, all eyes today

879
00:42:43,520 --> 00:42:46,760
Speaker 10: and tomorrow are focused on Washington. That's where Fed Chairman

880
00:42:46,880 --> 00:42:50,120
Speaker 10: j Powell gives his semi annual report to Congress. We

881
00:42:50,200 --> 00:42:52,719
Speaker 10: get a preview from Bloomberg's Michael McKee in.

882
00:42:52,640 --> 00:42:55,120
Speaker 20: The House today, the Fed Chairman will have the opportunity

883
00:42:55,160 --> 00:42:58,319
Speaker 20: to clarify what some feel was a confusing message on

884
00:42:58,360 --> 00:43:01,440
Speaker 20: the path for interest rates would lead central bankers to

885
00:43:01,520 --> 00:43:04,960
Speaker 20: raise rates again, something their own forecasts suggests will happen.

886
00:43:05,320 --> 00:43:08,680
Speaker 20: Does inflation have to rise, does unemployment or does it

887
00:43:08,760 --> 00:43:11,600
Speaker 20: just have to remain flat? What is the ultimate end rate?

888
00:43:11,840 --> 00:43:14,239
Speaker 20: And how soon after that might they begin the rate

889
00:43:14,320 --> 00:43:17,680
Speaker 20: cuts they foresee for twenty twenty four. There will also

890
00:43:17,719 --> 00:43:21,080
Speaker 20: be questions about the impact of March's bank failures and

891
00:43:21,200 --> 00:43:25,560
Speaker 20: on possible regulatory changes for the industry. Tomorrow poll comes

892
00:43:25,560 --> 00:43:29,480
Speaker 20: back to testify before the Senate. Michael McKee Bloomberg.

893
00:43:29,080 --> 00:43:32,160
Speaker 15: Daybreak, Okay, Mike, As investors await possible clues on the

894
00:43:32,160 --> 00:43:35,400
Speaker 15: future of rates, Brown Brothers Harriman, head of Securrency Strategy,

895
00:43:35,440 --> 00:43:38,440
Speaker 15: when thin thinks the FED is far from done, when.

896
00:43:38,280 --> 00:43:41,640
Speaker 21: All it does settles, I think the Fed is going

897
00:43:41,680 --> 00:43:43,920
Speaker 21: to go higher for longer. The market still doesn't quite

898
00:43:43,960 --> 00:43:47,160
Speaker 21: believe the Fed one hike pricing, but the fest single

899
00:43:47,200 --> 00:43:49,680
Speaker 21: number two, and I said to a lot of anas,

900
00:43:49,760 --> 00:43:51,439
Speaker 21: I don't think the Fed will hike again.

901
00:43:51,480 --> 00:43:53,440
Speaker 1: That this isn't just a pause, this is the end.

902
00:43:53,880 --> 00:43:55,000
Speaker 19: I wholehearted disagree.

903
00:43:55,280 --> 00:43:58,000
Speaker 15: Brown Brothers Harriman's whin then expects a stronger dollar the

904
00:43:58,040 --> 00:43:58,719
Speaker 15: rest of the year.

905
00:43:59,320 --> 00:43:59,480
Speaker 22: Well.

906
00:43:59,560 --> 00:44:02,400
Speaker 10: Rates are also in focus in Europe. This morning, Nathan,

907
00:44:02,440 --> 00:44:05,560
Speaker 10: after a hot inflation reading over in the UK, and

908
00:44:05,600 --> 00:44:08,280
Speaker 10: we get the latest of the Bloomberg's Ewan pots in London.

909
00:44:08,280 --> 00:44:10,040
Speaker 10: Good morning, Ewan, Good.

910
00:44:09,800 --> 00:44:12,759
Speaker 23: Morning Kardon Nathan. It's hot in London again today. But

911
00:44:12,800 --> 00:44:15,680
Speaker 23: while the weather is nice, our fourth inflation reading high

912
00:44:15,680 --> 00:44:19,160
Speaker 23: that estimates is not so welcome. Consumer prizes rose eight

913
00:44:19,200 --> 00:44:21,399
Speaker 23: point seven percent in the year to May. To find

914
00:44:21,440 --> 00:44:25,320
Speaker 23: forecasts for a slowdown in price gains core inflation unexpected.

915
00:44:25,400 --> 00:44:28,360
Speaker 23: The rose on last month. It's now at a thirty

916
00:44:28,560 --> 00:44:31,080
Speaker 23: one year high. It's all a headache for the Bank

917
00:44:31,120 --> 00:44:33,360
Speaker 23: of England as they weigh their next move in tomorrow's

918
00:44:33,360 --> 00:44:36,200
Speaker 23: policy meeting. Traders are ramping up bets the bank will

919
00:44:36,200 --> 00:44:39,760
Speaker 23: need to administer stronger medicine in their fight against rampant's inflation.

920
00:44:40,120 --> 00:44:41,960
Speaker 23: In London, I'm you in pots Bloomberg.

921
00:44:41,640 --> 00:44:43,000
Speaker 2: Daybreak, Marry Ewan, thank you.

922
00:44:43,080 --> 00:44:45,320
Speaker 15: Back here in the US, We're watching shares of FedEx

923
00:44:45,320 --> 00:44:48,040
Speaker 15: in early trading. They're down about three percent after the

924
00:44:48,040 --> 00:44:50,759
Speaker 15: company gave a twenty twenty four profit outlook that came

925
00:44:50,800 --> 00:44:53,640
Speaker 15: in below analysts essamates, and we get the story from

926
00:44:53,640 --> 00:44:55,000
Speaker 15: Bloomberg's Charlie Palette.

927
00:44:55,280 --> 00:44:59,879
Speaker 22: A drop in package demand offset CEO Raj subramanians four

928
00:45:00,160 --> 00:45:03,640
Speaker 22: billion dollar cost cutting plan. The company has sought to

929
00:45:03,680 --> 00:45:07,000
Speaker 22: reduce expenses as the industry deals with a decline and

930
00:45:07,120 --> 00:45:11,480
Speaker 22: package volume following two years of surging demand fueled by

931
00:45:11,600 --> 00:45:16,439
Speaker 22: pandemic driven online shopping. In a separate statement, FedEx said

932
00:45:16,520 --> 00:45:20,800
Speaker 22: CFO Michael Lens will retire effective July thirty first.

933
00:45:21,440 --> 00:45:22,239
Speaker 2: In New York.

934
00:45:22,360 --> 00:45:24,720
Speaker 22: Charlie Pellett's Bloomberg Daybreak.

935
00:45:24,400 --> 00:45:27,040
Speaker 10: Right, Charlie, Thanks, and JP Morgan ches is making a

936
00:45:27,160 --> 00:45:30,759
Speaker 10: fresh round of layoffs in Asia. Bloomberg News has learned

937
00:45:30,800 --> 00:45:34,239
Speaker 10: the bank is cutting about twenty investment banking jobs as

938
00:45:34,320 --> 00:45:38,160
Speaker 10: deal flows remain muted. Sources say the reductions impact mostly

939
00:45:38,239 --> 00:45:42,240
Speaker 10: junior staff and associates and analyst levels, and sectors including consumer,

940
00:45:42,320 --> 00:45:44,240
Speaker 10: healthcare and private capital markets.

941
00:45:48,680 --> 00:45:50,040
Speaker 15: Time now to take a look at some of the

942
00:45:50,040 --> 00:45:52,359
Speaker 15: other stories making news in New York and around the world,

943
00:45:52,440 --> 00:45:54,760
Speaker 15: and for that we are joined by Bloomberg's Michael Barr.

944
00:45:54,760 --> 00:45:57,560
Speaker 8: Good morning, Michael, Good morning, Nathan. New York is joining

945
00:45:57,600 --> 00:46:01,880
Speaker 8: other states on banning employee on compete agreements. The bill

946
00:46:01,960 --> 00:46:05,919
Speaker 8: coincides with Federal Trade Commission and National Labor Relations Board

947
00:46:05,960 --> 00:46:09,440
Speaker 8: actions to fight non competes. The measure now heads to

948
00:46:09,520 --> 00:46:13,000
Speaker 8: Governor Kathy Oakle's desk after the state Assembly passed it yesterday.

949
00:46:13,520 --> 00:46:17,560
Speaker 8: Employer's use of non compete contracts, which restrict workers from

950
00:46:17,600 --> 00:46:20,600
Speaker 8: going to work for a competitor, cover an estimated one

951
00:46:20,719 --> 00:46:24,280
Speaker 8: fifth of the US workforce. The FDN and Y confirmed

952
00:46:24,280 --> 00:46:27,880
Speaker 8: what many suspected, a lithium ion battery was the cause

953
00:46:27,920 --> 00:46:31,600
Speaker 8: of Tuesday's fire that killed four people in Manhattan. The

954
00:46:31,640 --> 00:46:34,320
Speaker 8: blaze started in an e bike shop on the Lower

955
00:46:34,360 --> 00:46:38,080
Speaker 8: east Side. The shop is downstairs from their apartments in

956
00:46:38,120 --> 00:46:41,919
Speaker 8: the sixth story building. New York City Fire Commissioner lower

957
00:46:42,000 --> 00:46:42,759
Speaker 8: kevinough his.

958
00:46:42,960 --> 00:46:46,480
Speaker 24: Exact scenario where there is an e bike store on

959
00:46:46,520 --> 00:46:49,560
Speaker 24: the first floor and residences above, and the volume of

960
00:46:49,640 --> 00:46:54,040
Speaker 24: fire created by these lithium ion batteries is incredibly deadly.

961
00:46:54,640 --> 00:46:57,800
Speaker 8: The FDN Y says the shop was inspected in August

962
00:46:57,960 --> 00:47:02,880
Speaker 8: of last year and summons were issued. A former NYPD

963
00:47:03,000 --> 00:47:06,160
Speaker 8: officer is among a group of people convicted of working

964
00:47:06,160 --> 00:47:09,840
Speaker 8: for China. More from Bloomberg's Dan Schwartzman, three.

965
00:47:09,680 --> 00:47:12,640
Speaker 25: People, including a retired New York City Police sergeant, have

966
00:47:12,760 --> 00:47:15,280
Speaker 25: been convicted of acting as agents of the People's Republic

967
00:47:15,320 --> 00:47:18,279
Speaker 25: of China. Prosecutors showed that the three carried out ill

968
00:47:18,320 --> 00:47:21,680
Speaker 25: legal law enforcement operations in the US, including trying to

969
00:47:21,680 --> 00:47:24,640
Speaker 25: pressure dissidents to return to China. The three were in

970
00:47:24,719 --> 00:47:27,080
Speaker 25: a group of eight originally charged back in October of

971
00:47:27,080 --> 00:47:30,759
Speaker 25: twenty twenty of participating in Operation fox Hunt, which a

972
00:47:30,840 --> 00:47:34,080
Speaker 25: Chinese government says was a legitimate operation to track down

973
00:47:34,160 --> 00:47:37,720
Speaker 25: fugitives in New York I. Dan Schwartzman Bloomberg Daybreak.

974
00:47:37,800 --> 00:47:41,440
Speaker 8: President Joe Biden is hosting Indian Prime Minister Narindra Modi

975
00:47:41,600 --> 00:47:44,680
Speaker 8: for state visit this week. Biden hopes to improve his

976
00:47:44,800 --> 00:47:47,320
Speaker 8: relationship with the leader of a nation of one point

977
00:47:47,400 --> 00:47:51,240
Speaker 8: four billion at the US administration sees as a pivotal

978
00:47:51,280 --> 00:47:54,560
Speaker 8: force in Asia for decades to come. Dozens of Congressional

979
00:47:54,640 --> 00:47:57,600
Speaker 8: members are urging President Biden to talk to Modi about

980
00:47:57,680 --> 00:48:03,080
Speaker 8: human rights concerns. Todaymi is highlighting inner tranquility. His public

981
00:48:03,120 --> 00:48:06,240
Speaker 8: schedule for the day opens with a group yoga session

982
00:48:06,640 --> 00:48:10,040
Speaker 8: on the United Nations North Lawn. Global News twenty four

983
00:48:10,080 --> 00:48:13,000
Speaker 8: hours a day, powered by more than twenty seven hundred

984
00:48:13,040 --> 00:48:16,080
Speaker 8: journalist and analyst over one hundred twenty countries. I'm Michael Barr.

985
00:48:16,160 --> 00:48:17,280
Speaker 8: This is Bloomberg, Nathan.

986
00:48:17,320 --> 00:48:24,840
Speaker 15: Thank you, Michael. Time now for the Bloomberg Sports Update,

987
00:48:24,920 --> 00:48:26,480
Speaker 15: and for that, here's John stash Out.

988
00:48:26,520 --> 00:48:29,000
Speaker 16: All right, Nathan, Yankees back home after the rough weekend

989
00:48:29,000 --> 00:48:31,720
Speaker 16: in Boston, and thankfully Garrett Cole was on the mound,

990
00:48:31,760 --> 00:48:34,399
Speaker 16: dominant in seven to thirty means, allowed one run, only

991
00:48:34,400 --> 00:48:36,960
Speaker 16: four hits, struck out eight. Clay Holmes got the last

992
00:48:37,040 --> 00:48:39,120
Speaker 16: five outs. So much needed a Yankee win. Three to

993
00:48:39,160 --> 00:48:42,200
Speaker 16: one over Seattle. They beat the Mariners George Kirby, the

994
00:48:42,320 --> 00:48:44,520
Speaker 16: Ryan native who had shut them out in a recent

995
00:48:44,520 --> 00:48:47,279
Speaker 16: game in Seattle, Billy McKinney to the two run homer

996
00:48:47,360 --> 00:48:49,600
Speaker 16: off Kirby in the second inning. Before the game, Yankee

997
00:48:49,600 --> 00:48:52,760
Speaker 16: g and Brian Cashman met the media to discuss the Yanks'

998
00:48:52,800 --> 00:48:53,640
Speaker 16: recent struggles.

999
00:48:53,760 --> 00:48:56,520
Speaker 26: Got a really good team when we're flying high and

1000
00:48:56,560 --> 00:48:58,560
Speaker 26: playing the way we're capable of. Right now, we haven't

1001
00:48:58,600 --> 00:49:01,680
Speaker 26: been doing that, So it looks bad. It feels bad,

1002
00:49:01,760 --> 00:49:06,799
Speaker 26: It tastes bad, and no one likes losing, so so

1003
00:49:06,880 --> 00:49:10,760
Speaker 26: I understand why the fans are upset and not happy

1004
00:49:10,840 --> 00:49:11,960
Speaker 26: with how it's playing out.

1005
00:49:12,080 --> 00:49:13,920
Speaker 16: Cash but said he still has belief in rookie short

1006
00:49:13,960 --> 00:49:17,680
Speaker 16: staff Anthony Volfe, who's among many Yankees who have been struggling.

1007
00:49:17,320 --> 00:49:18,040
Speaker 8: Mets at Houston.

1008
00:49:18,120 --> 00:49:21,200
Speaker 16: Justin Verlanders faced his former team, and Alex Bregman hit

1009
00:49:21,200 --> 00:49:23,279
Speaker 16: a two run homer off him. The Astros won four

1010
00:49:23,320 --> 00:49:25,360
Speaker 16: to two. The Mets ten only four hits, didn't have

1011
00:49:25,400 --> 00:49:28,000
Speaker 16: a base runner off Franbur Valdez until the sixth inning.

1012
00:49:28,040 --> 00:49:31,600
Speaker 16: They didn't score until the eighth Freeway Series. Dodgers shut

1013
00:49:31,600 --> 00:49:34,360
Speaker 16: out the Angels to nothing behind Clayton Kershaw. The Cincinnati

1014
00:49:34,400 --> 00:49:37,080
Speaker 16: Reds last season lost one hundred games. They just won

1015
00:49:37,120 --> 00:49:39,640
Speaker 16: their tenth game in a row, and the Giants, a

1016
00:49:39,680 --> 00:49:42,239
Speaker 16: five hundred team last year, won their ninth straight. The

1017
00:49:42,280 --> 00:49:45,440
Speaker 16: ex met Marcus Stroman has the lowest DRA in the

1018
00:49:45,520 --> 00:49:47,560
Speaker 16: National League. He pitched the Cubs to a shutout win

1019
00:49:47,560 --> 00:49:50,920
Speaker 16: over Pittsburgh and the ex Yankee Aaron Hicks, who's still

1020
00:49:50,960 --> 00:49:53,000
Speaker 16: getting paid by the Yanks. They released him with a

1021
00:49:53,040 --> 00:49:55,000
Speaker 16: one eighty eight batting average. He had a homer four

1022
00:49:55,080 --> 00:49:58,440
Speaker 16: RBIs in Baltimore's win at Tampa Bay. Hicks with the

1023
00:49:58,440 --> 00:50:02,400
Speaker 16: orioles is batting three four John stash that were Bloomberg.

1024
00:50:01,960 --> 00:50:07,839
Speaker 13: Sports from coast to coast, from New York to San Francisco,

1025
00:50:08,160 --> 00:50:12,760
Speaker 13: Boston to Washington, DC, nationwide on Sirias Exam, the Bloomberg

1026
00:50:12,840 --> 00:50:15,000
Speaker 13: Business app in Bloomberg dot Com.

1027
00:50:15,040 --> 00:50:17,000
Speaker 2: This is Bloomberg Daybreak.

1028
00:50:18,280 --> 00:50:21,000
Speaker 15: Good morning, I'm Nathan Hager. While a flurry of legal

1029
00:50:21,080 --> 00:50:24,319
Speaker 15: news came out of Washington yesterday morning. First we learned

1030
00:50:24,320 --> 00:50:26,719
Speaker 15: the trial date for former President Donald Trump in the

1031
00:50:26,719 --> 00:50:30,760
Speaker 15: classified documents case. A federal judge set that for mid August.

1032
00:50:31,080 --> 00:50:34,240
Speaker 15: It was also announced that the current President's son, Hunter Biden,

1033
00:50:34,480 --> 00:50:37,640
Speaker 15: is facing tax and gun charges and reached a plea

1034
00:50:37,719 --> 00:50:41,479
Speaker 15: deal in that case. Bloomberg's Joe Matthews spoke with former

1035
00:50:41,520 --> 00:50:44,400
Speaker 15: White House Chief of Staff mcmulvaaney on Bloomberg Sound On

1036
00:50:44,600 --> 00:50:47,439
Speaker 15: to break down the political fallout for the current and

1037
00:50:47,680 --> 00:50:50,200
Speaker 15: former presidents. Let's hear part of that conversation.

1038
00:50:51,000 --> 00:50:54,960
Speaker 19: Anything short of a felony indictment of Hunter Biden was

1039
00:50:54,960 --> 00:50:57,480
Speaker 19: going to be interprened by some folks as too.

1040
00:50:57,560 --> 00:50:57,759
Speaker 1: Tier.

1041
00:50:57,880 --> 00:51:00,160
Speaker 19: I think it remains to be seen as to what

1042
00:51:00,920 --> 00:51:04,560
Speaker 19: in what are the facts, what was the circumstance behind

1043
00:51:04,880 --> 00:51:08,880
Speaker 19: Hunter Biden's tax issues. Now that the Chairman Comber's made

1044
00:51:08,880 --> 00:51:10,799
Speaker 19: a really good point, which is now that we are

1045
00:51:10,840 --> 00:51:13,200
Speaker 19: either you know, at the end or moving speedily to

1046
00:51:13,239 --> 00:51:16,360
Speaker 19: the end of the investigation of Hunter Biden, then the

1047
00:51:16,440 --> 00:51:19,239
Speaker 19: Department of Justice no longer has an excuse not to

1048
00:51:19,280 --> 00:51:24,400
Speaker 19: share information with Congress. So as between both the public

1049
00:51:24,560 --> 00:51:28,719
Speaker 19: hearing on the plea deal and the congressional investigation, my

1050
00:51:28,840 --> 00:51:31,040
Speaker 19: guess is we'll see a lot more about Hunter Biden

1051
00:51:31,040 --> 00:51:33,200
Speaker 19: than we know right now, and only then will you

1052
00:51:33,280 --> 00:51:36,440
Speaker 19: be able to sort of have an informed opinion as

1053
00:51:36,520 --> 00:51:38,879
Speaker 19: to a two different tiers of justice in this com.

1054
00:51:39,200 --> 00:51:42,640
Speaker 15: Does this quiet the voices of concern who thought Hunter

1055
00:51:42,719 --> 00:51:45,200
Speaker 15: Biden was never going to be acknowledged here in Washington,

1056
00:51:45,239 --> 00:51:47,120
Speaker 15: that this would never actually become a case.

1057
00:51:47,719 --> 00:51:50,560
Speaker 19: Yeah, a little bit. In fact, I had some conversations

1058
00:51:51,000 --> 00:51:53,480
Speaker 19: with some of my friends, by Republican friends who are

1059
00:51:53,480 --> 00:51:56,959
Speaker 19: complaining about, well, they're charging trump but they're not charging Hunter.

1060
00:51:57,440 --> 00:51:59,160
Speaker 19: And then you know, say, well, okay, if they charge

1061
00:51:59,200 --> 00:52:04,240
Speaker 19: Hunter with them charging Trumpet very quiet, very quickly. So again,

1062
00:52:04,480 --> 00:52:06,520
Speaker 19: whether or not it's a serious charge, I guess we

1063
00:52:06,560 --> 00:52:08,640
Speaker 19: don't know yet until we see the facts in the file.

1064
00:52:09,000 --> 00:52:12,080
Speaker 15: Make the idea of an August fourteen trial date the

1065
00:52:12,200 --> 00:52:14,120
Speaker 15: all the while, and that might frankly be a bigger

1066
00:52:14,160 --> 00:52:17,480
Speaker 15: story that's been kind of overshadowed by the Hunter headline.

1067
00:52:17,520 --> 00:52:19,880
Speaker 15: Do you think a trial actually begins in August?

1068
00:52:20,400 --> 00:52:22,280
Speaker 19: And no, you're not supposed to make, you know, absolute

1069
00:52:22,320 --> 00:52:24,600
Speaker 19: tradictions when you're dealing with politics, and there's a lot

1070
00:52:24,600 --> 00:52:26,920
Speaker 19: of politics here. But I'd be willing to bet my

1071
00:52:26,960 --> 00:52:29,719
Speaker 19: house there's no trial in August fourteen. Keep in mind,

1072
00:52:29,760 --> 00:52:32,879
Speaker 19: the right to a speedy trial, which does exist under

1073
00:52:32,880 --> 00:52:37,040
Speaker 19: our constitution, is possessed by the accused not by the government.

1074
00:52:37,880 --> 00:52:39,800
Speaker 19: So you know, if Donald Trump wants to have slowed

1075
00:52:39,800 --> 00:52:42,120
Speaker 19: things down, there's going to be plenty of opportunities to do. So.

1076
00:52:42,160 --> 00:52:43,920
Speaker 19: You've made a good point about how hard it's going

1077
00:52:43,960 --> 00:52:46,759
Speaker 19: to be the picking jury. I disagree with your the

1078
00:52:46,800 --> 00:52:49,560
Speaker 19: reporter respectfully. I think it's going to be very, very

1079
00:52:49,560 --> 00:52:52,279
Speaker 19: difficult to pick a jury here because everybody's going to

1080
00:52:52,280 --> 00:52:54,120
Speaker 19: have an opinion about it, and Donald Trump is going

1081
00:52:54,160 --> 00:52:56,799
Speaker 19: to be looking for one juror who's willing to say,

1082
00:52:56,800 --> 00:52:58,279
Speaker 19: you know, I don't care what he did. I'm not

1083
00:52:58,360 --> 00:53:00,040
Speaker 19: convicting it because he only has to get it one

1084
00:53:00,080 --> 00:53:02,400
Speaker 19: person to hold out, and the government knows that. So

1085
00:53:02,480 --> 00:53:04,520
Speaker 19: that's going to take a long time. The government may

1086
00:53:04,520 --> 00:53:06,560
Speaker 19: try to recuse the judge. That may take a long time.

1087
00:53:06,600 --> 00:53:08,279
Speaker 19: It's going to be flights over evidence that may take

1088
00:53:08,280 --> 00:53:10,200
Speaker 19: a long time. So if I'm a betting man, and

1089
00:53:10,239 --> 00:53:13,840
Speaker 19: I am, I'm not betting among them, and.

1090
00:53:13,800 --> 00:53:17,240
Speaker 15: I am, says Mick mulvaney that said, does the trial

1091
00:53:17,280 --> 00:53:19,799
Speaker 15: begin before the presidential election? Or is that really what

1092
00:53:19,840 --> 00:53:22,760
Speaker 15: we're talking about here? Anything to delay it past the election.

1093
00:53:23,080 --> 00:53:24,560
Speaker 19: I talked to a lot of my friends who were

1094
00:53:24,560 --> 00:53:26,560
Speaker 19: in the federal prosecuting business. A lot of folks who

1095
00:53:26,640 --> 00:53:29,719
Speaker 19: used to do white collar criminal defense to a man

1096
00:53:29,800 --> 00:53:31,719
Speaker 19: and a woman, they all thought this trial would take

1097
00:53:31,719 --> 00:53:34,879
Speaker 19: place after the election. I think we're all surprised by

1098
00:53:34,920 --> 00:53:37,640
Speaker 19: this announcement, at least of this early date. And whether

1099
00:53:37,680 --> 00:53:39,319
Speaker 19: or not that changes the caucus, you know, I'd have

1100
00:53:39,320 --> 00:53:41,600
Speaker 19: to talk to folks who've done this for twenty thirty years.

1101
00:53:42,120 --> 00:53:44,120
Speaker 19: I'm not sure how Donald Trump delays it for a

1102
00:53:44,200 --> 00:53:46,600
Speaker 19: year and you know, four months or whatever. But I

1103
00:53:46,640 --> 00:53:48,239
Speaker 19: still think it's a better chance than not that it

1104
00:53:48,280 --> 00:53:50,440
Speaker 19: comes after the election. But again, this has thrown me

1105
00:53:50,440 --> 00:53:53,000
Speaker 19: a curveball along that everybody else see. It's August fourteenth day.

1106
00:53:53,160 --> 00:53:54,800
Speaker 15: I don't know if you saw Donald Trump and Brett

1107
00:53:54,800 --> 00:53:57,800
Speaker 15: Bayer on Fox News. There were some pretty remarkable moments,

1108
00:53:57,800 --> 00:54:00,520
Speaker 15: and it's been suggested that some of the could be

1109
00:54:00,640 --> 00:54:03,520
Speaker 15: entered as evidence in the trial, particularly as he discusses

1110
00:54:04,040 --> 00:54:06,600
Speaker 15: moving the boxes around and what was in the boxes.

1111
00:54:06,600 --> 00:54:08,080
Speaker 15: Here's the moment that you might have missed.

1112
00:54:08,120 --> 00:54:09,520
Speaker 2: So why not just hand them over then?

1113
00:54:09,760 --> 00:54:12,120
Speaker 13: Because I had a boxes, I want to go through

1114
00:54:12,120 --> 00:54:14,560
Speaker 13: the boxes and get all my personal things out.

1115
00:54:14,800 --> 00:54:16,600
Speaker 12: I don't want to hand that over to Narrow yet.

1116
00:54:16,840 --> 00:54:19,000
Speaker 15: And I was very busy, as you've sort of seen.

1117
00:54:19,080 --> 00:54:21,279
Speaker 19: Yeah, but according to the Diamonds, you then tell this

1118
00:54:21,360 --> 00:54:24,520
Speaker 19: aide to move to other locations after telling your lawyers

1119
00:54:24,560 --> 00:54:27,160
Speaker 19: to say you'd fully complied with the subpoena when you hadn't.

1120
00:54:27,320 --> 00:54:29,520
Speaker 12: But before I send boxes over, I have to take

1121
00:54:29,600 --> 00:54:30,239
Speaker 12: all of my things.

1122
00:54:30,239 --> 00:54:33,560
Speaker 15: Actually, the former president do damage to himself.

1123
00:54:33,880 --> 00:54:36,520
Speaker 19: Yes, I was watching it. I was actually texting a

1124
00:54:36,560 --> 00:54:39,120
Speaker 19: little bit with Berett Bair. You know, the interview wasn't live.

1125
00:54:39,320 --> 00:54:41,160
Speaker 19: All I could think of is now the public sort

1126
00:54:41,160 --> 00:54:43,120
Speaker 19: of gets a chance to see why so many of

1127
00:54:43,160 --> 00:54:46,080
Speaker 19: Donald trump lawyers quit because he made things much much

1128
00:54:46,160 --> 00:54:48,840
Speaker 19: worse for himself. There's one thing that it wasn't in

1129
00:54:48,880 --> 00:54:50,960
Speaker 19: the segment you just picked up, but it was right

1130
00:54:51,000 --> 00:54:53,200
Speaker 19: about the same time where he said. Brett asked him

1131
00:54:53,239 --> 00:54:56,160
Speaker 19: about the papers that he held up on the audio tape,

1132
00:54:56,160 --> 00:54:58,080
Speaker 19: and Trump said, there was nothing there. There was nothing there.

1133
00:54:58,080 --> 00:55:00,719
Speaker 19: It was just a newspaper clippings and stuffy pretending like

1134
00:55:00,760 --> 00:55:02,520
Speaker 19: it was favored or mus be classified.

1135
00:55:02,560 --> 00:55:02,920
Speaker 3: But it's not.

1136
00:55:03,400 --> 00:55:05,920
Speaker 19: In order to make that defense, he has to testify.

1137
00:55:06,920 --> 00:55:09,359
Speaker 19: And I can guarantee you that Donald Trump is not

1138
00:55:09,440 --> 00:55:13,160
Speaker 19: testifying in this case, so that is going to be

1139
00:55:13,320 --> 00:55:16,040
Speaker 19: used against him. Most of a lot of that video

1140
00:55:16,040 --> 00:55:18,880
Speaker 19: will be used to give to him.

1141
00:55:18,920 --> 00:55:21,799
Speaker 17: This is Bloomberg day Break Today, your morning brief on

1142
00:55:21,880 --> 00:55:25,440
Speaker 17: the stories making news from Wall Street to Washington and beyond.

1143
00:55:25,680 --> 00:55:28,480
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1144
00:55:28,560 --> 00:55:32,200
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1145
00:55:32,280 --> 00:55:33,440
Speaker 10: get your podcasts.

1146
00:55:33,560 --> 00:55:36,239
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1147
00:55:36,320 --> 00:55:38,960
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1148
00:55:38,960 --> 00:55:41,760
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1149
00:55:41,920 --> 00:55:44,760
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1150
00:55:44,840 --> 00:55:46,520
Speaker 17: ninety sixty in San Francisco.

1151
00:55:46,920 --> 00:55:50,080
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1152
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1153
00:55:55,600 --> 00:55:58,560
Speaker 17: Listen coast to coast on the Bloomberg Business app, serious

1154
00:55:58,719 --> 00:56:02,680
Speaker 17: XM Channel one nineteen, the iHeartRadio app, and on Bloomberg

1155
00:56:02,800 --> 00:56:05,719
Speaker 17: dot Com. I'm Nathan Haager and I'm Karen Moscow.

1156
00:56:05,800 --> 00:56:08,600
Speaker 10: Join us again tomorrow morning for all the news you

1157
00:56:08,680 --> 00:56:11,880
Speaker 10: need to start your day right here on Bloomberg Daybreak