1 00:00:00,080 --> 00:00:13,040 Speaker 1: Ye, Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keane 2 00:00:13,480 --> 00:00:17,560 Speaker 1: jay Ley. We bring you insight from the best in economics, finance, investment, 3 00:00:18,000 --> 00:00:23,480 Speaker 1: and international relations. Find Bloomberg Surveillance on Apple Podcasts, SoundCloud, 4 00:00:23,600 --> 00:00:34,159 Speaker 1: Bloomberg dot Com and of course on the Bloomberg with Us. 5 00:00:34,159 --> 00:00:36,920 Speaker 1: We are thrilled this morning to have Davide Sarah with 6 00:00:37,080 --> 00:00:41,519 Speaker 1: Us of Algebrast, truly expert on EU banking. Davida to 7 00:00:41,600 --> 00:00:46,160 Speaker 1: our global Wall Street audience, what is the single statistical 8 00:00:46,479 --> 00:00:50,519 Speaker 1: or ratio observation of EU banking that maybe is not 9 00:00:50,640 --> 00:00:57,440 Speaker 1: in the zeitgeist right now? What's the Sarah ratio that matters? Well? 10 00:00:57,720 --> 00:01:00,560 Speaker 1: I think the nless the probably Matt as the most 11 00:01:00,640 --> 00:01:04,679 Speaker 1: is the number of banking institution. Um, you know, the 12 00:01:04,720 --> 00:01:08,920 Speaker 1: EU has the highest number of banks. We're talking about 13 00:01:08,959 --> 00:01:13,440 Speaker 1: an AMBO which is very twenty eight thousand institution vacompass 14 00:01:13,560 --> 00:01:16,240 Speaker 1: basically three times or size the US basically for the 15 00:01:16,280 --> 00:01:19,640 Speaker 1: same economy. And if you take the top five banks 16 00:01:19,680 --> 00:01:22,480 Speaker 1: in Europe in the US in terms of concentration of 17 00:01:22,520 --> 00:01:26,319 Speaker 1: the posits now have almost fifty in Europe and not 18 00:01:26,400 --> 00:01:30,880 Speaker 1: even fifteen percent. Very we've got too many banks and 19 00:01:30,959 --> 00:01:34,320 Speaker 1: not large enough. Well, very very interesting. Not only do 20 00:01:34,360 --> 00:01:36,399 Speaker 1: you do the financial but you also look at the 21 00:01:36,480 --> 00:01:39,240 Speaker 1: human condition here, and so much of it is set 22 00:01:39,319 --> 00:01:43,560 Speaker 1: up with boards that I would suggest really don't represent shareholders. 23 00:01:43,680 --> 00:01:47,480 Speaker 1: Is that true, the boards really don't Deutsche Bank, Commerce Bank, whatever, 24 00:01:47,800 --> 00:01:53,000 Speaker 1: that they really aren't representing shareholders. Well, yes or no? 25 00:01:53,200 --> 00:01:57,560 Speaker 1: Because the right now more than seventy eight percent of 26 00:01:57,920 --> 00:02:01,560 Speaker 1: large European banks actually held by titition and shoreholders. So 27 00:02:02,120 --> 00:02:04,960 Speaker 1: the reality is thetituitions shoreholders can have a weight that 28 00:02:05,000 --> 00:02:08,280 Speaker 1: the reality is because about thirty percent are passive. No 29 00:02:08,360 --> 00:02:11,280 Speaker 1: one is voting, they don't really care. They're mimicking an index, 30 00:02:11,600 --> 00:02:13,680 Speaker 1: and that has become a problem. And that's why you 31 00:02:13,800 --> 00:02:17,680 Speaker 1: see a few activists stepping up and actually making a point, 32 00:02:18,120 --> 00:02:22,280 Speaker 1: simply because the majority has basically abdicated the role of stewartship. 33 00:02:22,560 --> 00:02:24,919 Speaker 1: We still see in the US. Do you own any 34 00:02:24,960 --> 00:02:28,280 Speaker 1: Deutsche Bank or Commerce Bank? We do not own any 35 00:02:28,360 --> 00:02:32,400 Speaker 1: Dodge bank or merge equity. We do on some of 36 00:02:32,400 --> 00:02:35,840 Speaker 1: the credit if a merge will be very positive of 37 00:02:35,919 --> 00:02:39,680 Speaker 1: their credit status because you'll basically need a recap or 38 00:02:39,760 --> 00:02:42,240 Speaker 1: some sort of the other. So you probably need equity 39 00:02:42,240 --> 00:02:44,320 Speaker 1: at the bottom of the capital structure, so that will 40 00:02:44,360 --> 00:02:47,400 Speaker 1: be positive for credit equity will have to see. I 41 00:02:47,400 --> 00:02:49,679 Speaker 1: know we were talking a little bit about it last week, 42 00:02:49,720 --> 00:02:52,080 Speaker 1: but does it make sense. This is, I guess the 43 00:02:52,120 --> 00:02:55,480 Speaker 1: only way in which you can really cut costs because 44 00:02:55,520 --> 00:02:58,120 Speaker 1: of the unions and because some of the labor laws. 45 00:02:58,480 --> 00:03:00,480 Speaker 1: But then Deutsche Bank is also doing with its U 46 00:03:00,480 --> 00:03:02,520 Speaker 1: S investment arm and I don't know how that fits 47 00:03:02,560 --> 00:03:05,600 Speaker 1: into the conversation. Well, I think there are a free 48 00:03:05,600 --> 00:03:08,280 Speaker 1: issue here. The first one is under German label laws, 49 00:03:08,400 --> 00:03:12,560 Speaker 1: you can't really get a massive redendancy package and five 50 00:03:12,600 --> 00:03:15,960 Speaker 1: lots of people unless you have eneminy activity. Secondly, if 51 00:03:15,960 --> 00:03:18,760 Speaker 1: you look at common Spank and dodge Bank, dodge Bank 52 00:03:18,800 --> 00:03:22,040 Speaker 1: has about ninety people. If you have contractors, you're almost 53 00:03:22,120 --> 00:03:24,920 Speaker 1: under and ten thousand for a revenue base of twenty 54 00:03:24,919 --> 00:03:27,679 Speaker 1: eight billion euro, which is below Goldman, which has a 55 00:03:27,760 --> 00:03:31,079 Speaker 1: third of employees less than thirty. So the issue is 56 00:03:31,200 --> 00:03:35,240 Speaker 1: Dodge Bank is just too many employees for its revenue base. Secondly, 57 00:03:35,400 --> 00:03:39,200 Speaker 1: inside Germany, Common Spank is about fifty thousand employees but 58 00:03:39,320 --> 00:03:41,920 Speaker 1: an asset base which is a quarter of the one 59 00:03:41,960 --> 00:03:45,760 Speaker 1: of Dodgemank. So a merger between the two will strengthen 60 00:03:45,920 --> 00:03:49,000 Speaker 1: and will enable cost cutting. The Germany that will do 61 00:03:49,080 --> 00:03:52,000 Speaker 1: anything to the will do nothing to the international operation 62 00:03:52,000 --> 00:03:55,160 Speaker 1: on the dodgemank. And as a result you probably need 63 00:03:55,520 --> 00:03:58,400 Speaker 1: you know, you're looking at thirty forty employees or the 64 00:03:58,520 --> 00:04:01,880 Speaker 1: combined the cost pays I have to go, it's a 65 00:04:01,960 --> 00:04:05,680 Speaker 1: huge number. What's your favorite European bank right now? On 66 00:04:05,720 --> 00:04:12,800 Speaker 1: a standalone basis, our favorite are in Tessa, UniCredit, Santandre, NBNP. 67 00:04:14,240 --> 00:04:16,760 Speaker 1: That's sort of a retail skew there as well. You 68 00:04:16,800 --> 00:04:20,560 Speaker 1: mentioned fifteent, which I think for all Americans dobbyde is 69 00:04:20,600 --> 00:04:25,360 Speaker 1: basically unimaginable. Who controls the politics of Germany, the politics 70 00:04:25,400 --> 00:04:28,239 Speaker 1: of Austria, the politics of Italy is that the small 71 00:04:28,279 --> 00:04:30,880 Speaker 1: banking lobby? Is it the mid bank lobby or is 72 00:04:30,880 --> 00:04:33,320 Speaker 1: there a conduit from say unit credit right to the 73 00:04:33,320 --> 00:04:38,840 Speaker 1: Italian political leaders who olds who holds that power right now? Well, 74 00:04:38,960 --> 00:04:42,400 Speaker 1: first of all, in Europe, if you say banking, it's 75 00:04:42,440 --> 00:04:48,080 Speaker 1: bad simply because the populish rhetoric, it's centered around banks 76 00:04:48,080 --> 00:04:50,280 Speaker 1: of money. They're only given to us and as a 77 00:04:50,320 --> 00:04:53,640 Speaker 1: result of bad guys. This is across Europe. It's as 78 00:04:53,680 --> 00:04:57,480 Speaker 1: simple as that. Secondly, in Germany, though, because seventy cent 79 00:04:57,560 --> 00:05:00,400 Speaker 1: of the banking market is actually state owned, whether it 80 00:05:00,480 --> 00:05:03,560 Speaker 1: is SPA, Cassen or Lander's Banking, they hold the true 81 00:05:03,600 --> 00:05:07,039 Speaker 1: power and hence the strongest lobby group of the spark 82 00:05:07,040 --> 00:05:10,320 Speaker 1: Assen and the caster Path and in France the combination 83 00:05:10,360 --> 00:05:14,200 Speaker 1: of the two are the one which can basically make laws. 84 00:05:14,520 --> 00:05:18,799 Speaker 1: The larger banks forget it, they're basically in the dark house. 85 00:05:30,040 --> 00:05:33,040 Speaker 1: So one word echoed around trading flaws following the latest 86 00:05:33,080 --> 00:05:38,000 Speaker 1: jobs report goldilocks, goldilocks. Goldilocks investors taking some comfort that 87 00:05:38,080 --> 00:05:40,599 Speaker 1: the jobs market was running neither too hot or too cold, 88 00:05:40,839 --> 00:05:43,800 Speaker 1: and fueling the view that the rallying risk assets has 89 00:05:43,839 --> 00:05:45,640 Speaker 1: a little further to go. Here in the studio to 90 00:05:45,680 --> 00:05:50,359 Speaker 1: discuss this, Ibrahim Rock Barry City, Global head of FX Analysis. Ibrahim, 91 00:05:50,440 --> 00:05:53,160 Speaker 1: let's just begin with that word, goldilocks. I heard it 92 00:05:53,320 --> 00:05:56,240 Speaker 1: so much Friday through the weekended into Monday morning. Your 93 00:05:56,320 --> 00:05:59,320 Speaker 1: view on whether that accurately describes the U S economy 94 00:05:59,440 --> 00:06:03,200 Speaker 1: right now? I think it probably does. I think we're 95 00:06:03,640 --> 00:06:07,160 Speaker 1: in a world that's ultimately very supportive for for sid 96 00:06:07,200 --> 00:06:10,080 Speaker 1: markets and for risk appetite, and and the main the 97 00:06:10,120 --> 00:06:14,600 Speaker 1: main pillars of that are that growth indeed is is 98 00:06:14,640 --> 00:06:16,760 Speaker 1: good enough. It's neither too hot nor too cold, and 99 00:06:16,800 --> 00:06:19,039 Speaker 1: inflation will will be subdued, and all of that is 100 00:06:19,080 --> 00:06:22,880 Speaker 1: being being underwritten by a very dovish central bank. So 101 00:06:22,920 --> 00:06:24,520 Speaker 1: I don't think it's misleading. So I caught up with 102 00:06:24,520 --> 00:06:27,760 Speaker 1: the administration, and the administration wants a rate cut, and 103 00:06:27,760 --> 00:06:30,320 Speaker 1: I'm trying to understand the justification for a rate cut 104 00:06:30,440 --> 00:06:32,720 Speaker 1: at this point. Are you part of that group of 105 00:06:32,720 --> 00:06:35,560 Speaker 1: individuals that thinks we could get a right cut sometimes 106 00:06:35,560 --> 00:06:39,440 Speaker 1: soon from the Fed? Yes? Absolutely, I think that we 107 00:06:39,480 --> 00:06:42,800 Speaker 1: are dealing with a very very dovish central bank and 108 00:06:42,800 --> 00:06:45,640 Speaker 1: and ultimately with the combination of two forces that are 109 00:06:45,640 --> 00:06:49,240 Speaker 1: pushing pushing them in that direction. One is real politic, 110 00:06:49,279 --> 00:06:51,200 Speaker 1: if you like, we haven't. We have a big election 111 00:06:51,240 --> 00:06:52,960 Speaker 1: coming up next year, and of course part of the 112 00:06:53,040 --> 00:06:56,680 Speaker 1: rhetoric is to both make it more likely that the 113 00:06:56,720 --> 00:07:00,320 Speaker 1: economy stay stay strong and to position this administryation as 114 00:07:00,320 --> 00:07:03,760 Speaker 1: a pro growth administration. But the other and maybe intellectually 115 00:07:03,760 --> 00:07:07,360 Speaker 1: more interesting question, and ultimately economically one is how do 116 00:07:07,400 --> 00:07:12,560 Speaker 1: you how do you formulate policy to avoid a major slowdown? 117 00:07:12,920 --> 00:07:14,880 Speaker 1: Is there a way to beat the cycle if you like, 118 00:07:14,960 --> 00:07:17,480 Speaker 1: because that's I think precisely what the FED is trying 119 00:07:17,520 --> 00:07:19,480 Speaker 1: to do. Well. These kind of conversations worry may they 120 00:07:19,560 --> 00:07:21,240 Speaker 1: worry others as well. They preham the idea that you 121 00:07:21,240 --> 00:07:24,280 Speaker 1: can beat the cycle. Does that make sense to you 122 00:07:24,360 --> 00:07:26,520 Speaker 1: that kind of language. Well, I think it makes sense 123 00:07:26,520 --> 00:07:29,440 Speaker 1: for me to try. I think in the end you 124 00:07:29,480 --> 00:07:32,600 Speaker 1: will you will fail. But I think there's something to 125 00:07:32,680 --> 00:07:37,360 Speaker 1: the idea that perhaps historically central banks or policy makers 126 00:07:37,360 --> 00:07:39,760 Speaker 1: more generally have at times been slow to react to 127 00:07:39,760 --> 00:07:42,560 Speaker 1: a changing picture. I think this FED in particular has 128 00:07:42,600 --> 00:07:46,200 Speaker 1: been obsessed for some time with not repeating the mistakes 129 00:07:46,200 --> 00:07:49,680 Speaker 1: of the past. So I'm sympathetic to the view that 130 00:07:50,080 --> 00:07:53,680 Speaker 1: if you if you see a slow downcoming, try and come, 131 00:07:53,840 --> 00:07:57,600 Speaker 1: try and come into the act early. The front page 132 00:07:57,600 --> 00:08:01,200 Speaker 1: of Barons over the weaekend is the bull market unstoppable, 133 00:08:01,480 --> 00:08:03,160 Speaker 1: and then the lead quote was as follows the bull 134 00:08:03,240 --> 00:08:08,520 Speaker 1: market recently it's tent birthday. Can it rally for another ten? 135 00:08:08,640 --> 00:08:11,400 Speaker 1: We've heard it many times before, but it's worth repealing. 136 00:08:11,400 --> 00:08:13,360 Speaker 1: Bull markets do not die of old age. You have 137 00:08:13,480 --> 00:08:15,200 Speaker 1: to say that a lot of criticism about the front 138 00:08:15,240 --> 00:08:17,360 Speaker 1: out page being a contrayer and indicator, it was a 139 00:08:17,440 --> 00:08:20,040 Speaker 1: very balanced piece. Once you read through it. But Abraham, 140 00:08:20,040 --> 00:08:21,880 Speaker 1: that's kind of the position we're in right now. I 141 00:08:21,920 --> 00:08:24,640 Speaker 1: think there's a little bit of complacency creeping through. And 142 00:08:24,640 --> 00:08:27,280 Speaker 1: it's the idea that central banks can beat the cycle, 143 00:08:27,640 --> 00:08:31,160 Speaker 1: they can carry on pushing this out, and the view 144 00:08:31,200 --> 00:08:34,240 Speaker 1: of Federal Reserve Chairman Jpal himself that his old own 145 00:08:34,240 --> 00:08:37,959 Speaker 1: objective now is to extend the cycle. We're putting a 146 00:08:38,000 --> 00:08:39,880 Speaker 1: little bit too much faith in central bankers and their 147 00:08:39,920 --> 00:08:42,440 Speaker 1: ability to do that. Yes, absolutely, you know, and it 148 00:08:42,440 --> 00:08:45,480 Speaker 1: shouldn't be clear that one. I think if we look 149 00:08:45,520 --> 00:08:48,760 Speaker 1: at the most recent market developments, they clearly suggests that 150 00:08:49,440 --> 00:08:53,679 Speaker 1: some some some markets are being overboard. Whenever melt up 151 00:08:53,840 --> 00:08:56,880 Speaker 1: enters the financial vocabulary, you have to be you have 152 00:08:56,960 --> 00:08:59,480 Speaker 1: to be cautious. And the other is that clearly can't 153 00:08:59,520 --> 00:09:01,640 Speaker 1: just be sent show banks that safeguard this sort of 154 00:09:01,679 --> 00:09:04,680 Speaker 1: goldilocks environment. And I put much more weight on the 155 00:09:04,720 --> 00:09:09,560 Speaker 1: combination of stabilization and Chinese growth, including the policy similars 156 00:09:09,559 --> 00:09:12,640 Speaker 1: that they have had a peak in trade tensions, and 157 00:09:12,679 --> 00:09:15,720 Speaker 1: then the FED as a supportive act the march and 158 00:09:16,360 --> 00:09:20,120 Speaker 1: does currency dynamics right now, and particularly dollar dynamics, does 159 00:09:20,160 --> 00:09:25,719 Speaker 1: it help us multinationals? I think broadly speaking, yes, I 160 00:09:25,800 --> 00:09:28,760 Speaker 1: think we're because we are effectively an arrangement scenario. Of course, 161 00:09:28,800 --> 00:09:32,760 Speaker 1: the dollar is is still strong and relatively highly valued, 162 00:09:32,800 --> 00:09:36,120 Speaker 1: but the fact that it's not getting aggressively stronger is 163 00:09:37,080 --> 00:09:39,640 Speaker 1: I think a world that these multination. Part of the 164 00:09:39,800 --> 00:09:44,040 Speaker 1: enthusiasm John's mentioning on the cover of barons U is 165 00:09:44,080 --> 00:09:48,760 Speaker 1: the idea that multinationals can keep delivering down the income statement. Right. Yeah, 166 00:09:48,800 --> 00:09:50,840 Speaker 1: her world doesn't get in the way right now. So 167 00:09:50,920 --> 00:09:52,839 Speaker 1: I think that the dollar is not helping. But but 168 00:09:52,920 --> 00:09:55,480 Speaker 1: all I'm arguing is it's not it's not hurting too much. 169 00:09:55,520 --> 00:09:59,200 Speaker 1: And I think that their concerns probably more recently have 170 00:09:59,240 --> 00:10:03,320 Speaker 1: been centered around trade as opposed to as opposed to 171 00:10:03,320 --> 00:10:06,400 Speaker 1: perhaps the dollar. So again I don't think the dollar 172 00:10:06,480 --> 00:10:09,840 Speaker 1: is helping, but it's probably not top of their stuff concerns. 173 00:10:09,960 --> 00:10:12,760 Speaker 1: The cheap guide just looking back, I'll put my hat 174 00:10:12,760 --> 00:10:15,880 Speaker 1: on as the c i O of the of Hindsight 175 00:10:15,960 --> 00:10:18,440 Speaker 1: Capital just for a moment, if that's okay. But the 176 00:10:18,520 --> 00:10:20,600 Speaker 1: cheap guide for the EFEX market over the last couple 177 00:10:20,600 --> 00:10:23,280 Speaker 1: of years, Abraham, is when global risk appetite is good, 178 00:10:23,280 --> 00:10:26,160 Speaker 1: the dollar is weaker, and when global risk appetite is bad, 179 00:10:26,160 --> 00:10:28,320 Speaker 1: the dollar is stronger. I mean, that's pretty consistent. That's 180 00:10:28,320 --> 00:10:30,760 Speaker 1: maybe the one consistent framework that you can apply to 181 00:10:30,760 --> 00:10:33,040 Speaker 1: the effects market over the last couple of years. If 182 00:10:33,080 --> 00:10:39,360 Speaker 1: you're forecasting better risk appetite, a more stable Chinese economy, equally, 183 00:10:39,360 --> 00:10:42,640 Speaker 1: I imagine your forecasting a weaker dollar around you eventually. Yes, 184 00:10:42,840 --> 00:10:44,719 Speaker 1: But I think there's the devil is a bid in 185 00:10:44,760 --> 00:10:47,560 Speaker 1: the detail because two factors come into play here. One 186 00:10:47,679 --> 00:10:51,160 Speaker 1: is carry matters. So we are in a in a 187 00:10:51,200 --> 00:10:54,560 Speaker 1: search for yield environment, and the dollar is uncharacteristically now 188 00:10:54,880 --> 00:10:58,040 Speaker 1: a high yielder in in G ten exactly, it's it's 189 00:10:58,080 --> 00:11:01,400 Speaker 1: it's expensive to funding dollars. We're looking for alternative funding 190 00:11:01,440 --> 00:11:05,959 Speaker 1: currencies across the range. And the other is that we 191 00:11:05,960 --> 00:11:09,160 Speaker 1: we don't think that that improvement in risk appetite and 192 00:11:09,200 --> 00:11:12,680 Speaker 1: the improvement in the economic trajectory will be will be 193 00:11:13,240 --> 00:11:18,160 Speaker 1: a monitor monotonic dynamic. We think in particular that Europe 194 00:11:18,160 --> 00:11:21,520 Speaker 1: for now lacks some of the global improvement for European reasons, 195 00:11:21,520 --> 00:11:24,439 Speaker 1: if you like, so, particularly within G ten. I think 196 00:11:24,480 --> 00:11:26,800 Speaker 1: we're moving in that direction over the course of this year, 197 00:11:26,880 --> 00:11:29,280 Speaker 1: but I don't think right now this is a dollar 198 00:11:29,320 --> 00:11:31,679 Speaker 1: cell environment. Is you're at the trouble spot for you 199 00:11:31,840 --> 00:11:35,000 Speaker 1: at the moment. Sorry, I didn't it's Europe the trouble 200 00:11:35,080 --> 00:11:38,880 Speaker 1: spot for you at the moment. Certainly a laggard. I 201 00:11:38,920 --> 00:11:42,360 Speaker 1: think it's they're clearly a number of of of economies 202 00:11:42,360 --> 00:11:44,960 Speaker 1: in the world that are struggling even more. But I 203 00:11:45,000 --> 00:11:48,640 Speaker 1: think the level of disappointment in Europe is right up there. 204 00:11:49,040 --> 00:11:51,319 Speaker 1: Abraham right to catch out with the Abraham wrap. Bowery 205 00:11:51,360 --> 00:12:03,920 Speaker 1: City's global head of Effects Analysis, John Pharaoh is Brexit 206 00:12:04,000 --> 00:12:06,840 Speaker 1: worn out. And I got a little more interest in John, 207 00:12:06,920 --> 00:12:09,600 Speaker 1: but everybody, as we know it is Brexit worn out. 208 00:12:09,679 --> 00:12:11,559 Speaker 1: She was on with us ten days ago or so 209 00:12:12,000 --> 00:12:15,880 Speaker 1: and we got huge response from Catherine Barnard, who is 210 00:12:15,920 --> 00:12:21,280 Speaker 1: like actually an adult on the legal minutia, the paragraphs, 211 00:12:21,360 --> 00:12:25,320 Speaker 1: the sentences of all this Brexit EU trade stuff. She 212 00:12:25,440 --> 00:12:28,920 Speaker 1: is of course at Cambridge and is definitive on this. 213 00:12:29,720 --> 00:12:32,840 Speaker 1: I love this the UK and a changing Europe. Senior fellow, 214 00:12:32,840 --> 00:12:35,200 Speaker 1: I have no idea what that means, professor, Thank you 215 00:12:35,240 --> 00:12:38,400 Speaker 1: so much for joining us again. Where are the red 216 00:12:38,480 --> 00:12:42,720 Speaker 1: lines right now? Where are the red lines? Well, we 217 00:12:42,800 --> 00:12:45,040 Speaker 1: don't know if you're on the answer. They're looking a 218 00:12:45,040 --> 00:12:48,160 Speaker 1: bit pink. I a bit fuzzy around the edge. The 219 00:12:48,240 --> 00:12:50,839 Speaker 1: one red line that seems to still be there is 220 00:12:51,240 --> 00:12:54,480 Speaker 1: Theresa May wants to stop free movement of persons. That's 221 00:12:54,520 --> 00:12:58,199 Speaker 1: where individuals can go from France to Germany and live 222 00:12:58,280 --> 00:13:00,720 Speaker 1: there pretty much with that restriction. He wants to stop 223 00:13:00,760 --> 00:13:04,880 Speaker 1: that for UK citizens going abroad and for Polish and 224 00:13:05,400 --> 00:13:08,440 Speaker 1: Hungarian citizens coming to the UK. Okay, fine, but I 225 00:13:08,480 --> 00:13:12,120 Speaker 1: did some careful analysis ready for publication at a Cambridge 226 00:13:12,200 --> 00:13:17,160 Speaker 1: University standing in line at Heathrow, what's the what's the soul? 227 00:13:17,200 --> 00:13:21,520 Speaker 1: What if people have to go movement through a different 228 00:13:21,559 --> 00:13:25,760 Speaker 1: line at Heathrow or wherever it's It's not so much 229 00:13:25,840 --> 00:13:30,080 Speaker 1: the sort of temporary movement for tourism purposes. It's for 230 00:13:30,120 --> 00:13:32,360 Speaker 1: people who want to come to work. And at the 231 00:13:32,400 --> 00:13:36,280 Speaker 1: moment they can work in the UK pretty much without restrictions. Crucially, 232 00:13:36,320 --> 00:13:40,680 Speaker 1: they don't need a visa um if they come to 233 00:13:40,920 --> 00:13:44,920 Speaker 1: the UK. So an American or a or a Pakistani 234 00:13:45,040 --> 00:13:47,800 Speaker 1: national comes to the UK to work on a long 235 00:13:47,920 --> 00:13:52,120 Speaker 1: term basis, they need a visa, probably into visa and 236 00:13:52,160 --> 00:13:55,280 Speaker 1: those are really bureaucratic to get and they're also very 237 00:13:55,440 --> 00:13:58,560 Speaker 1: very Okay, the UK has got a visa rating probably 238 00:13:58,600 --> 00:14:01,680 Speaker 1: the most expensive world. Well well explained. Tell me what 239 00:14:01,800 --> 00:14:04,600 Speaker 1: Boris Jansen and other Brexiteers will do today. It's been 240 00:14:04,720 --> 00:14:09,240 Speaker 1: very centric and Tory labor that you know, no compromise thought. 241 00:14:09,760 --> 00:14:12,040 Speaker 1: And then of course Prime Minister May shooting a high 242 00:14:12,120 --> 00:14:15,840 Speaker 1: quality video Spielberg like and then and then of course 243 00:14:15,840 --> 00:14:18,040 Speaker 1: she's going to trot off and see macraw and get 244 00:14:18,080 --> 00:14:21,320 Speaker 1: her frequent flyer miles up. What are the other guys doing? 245 00:14:21,440 --> 00:14:26,000 Speaker 1: What does brexiteer doing? Well, what Brexiteurs are doing at 246 00:14:26,040 --> 00:14:28,720 Speaker 1: the moment is maneuvering to be to be the next 247 00:14:28,760 --> 00:14:31,080 Speaker 1: prime minister. The trouble is they don't want to be 248 00:14:31,120 --> 00:14:34,600 Speaker 1: the next prime minister now I this week or next week, 249 00:14:34,960 --> 00:14:36,520 Speaker 1: but they want to be able to do it in 250 00:14:36,680 --> 00:14:39,720 Speaker 1: three or four months time when I think the deal 251 00:14:39,880 --> 00:14:42,880 Speaker 1: is done and so. But what they're really worried about 252 00:14:43,000 --> 00:14:46,360 Speaker 1: is the reason May today is talking to the Labor Party, 253 00:14:46,440 --> 00:14:49,680 Speaker 1: the opposition Labor Party, and they think this is an 254 00:14:49,720 --> 00:14:54,360 Speaker 1: appalling decision. So the Brexiteers, people like Pretty Patel, who 255 00:14:54,440 --> 00:14:58,120 Speaker 1: you might remember from the referendum campaigns. He was part 256 00:14:58,120 --> 00:15:01,280 Speaker 1: of the group with Boris Johnson and others. She was saying, 257 00:15:01,280 --> 00:15:05,480 Speaker 1: you know, it is absolutely unforgivable that Theresa May should 258 00:15:05,520 --> 00:15:08,680 Speaker 1: be talking with the the Labor Party. The EU or the 259 00:15:08,720 --> 00:15:10,600 Speaker 1: EU think she should be talking to the Labor Party 260 00:15:10,720 --> 00:15:14,800 Speaker 1: they used to dealing with grand coalition. Charles Moore, writing 261 00:15:14,800 --> 00:15:17,240 Speaker 1: on the Telegraph, had a bar chart of like who's 262 00:15:17,280 --> 00:15:22,280 Speaker 1: for who's against? Regionally, basically only London's for. It is 263 00:15:22,280 --> 00:15:25,920 Speaker 1: the summary. I actually thought Prime Minister May's address yesterday 264 00:15:25,960 --> 00:15:29,800 Speaker 1: was something she should have said years ago, Catherine. I mean, 265 00:15:29,960 --> 00:15:31,960 Speaker 1: at the end of the day, this wasn't across party lines. 266 00:15:32,320 --> 00:15:34,040 Speaker 1: They should have got together a long long time ago. 267 00:15:34,080 --> 00:15:35,800 Speaker 1: Why did it take so long to get together and 268 00:15:35,840 --> 00:15:39,240 Speaker 1: talk about a compromise. I think there's a couple of reasons. 269 00:15:39,280 --> 00:15:42,560 Speaker 1: Partly to do with Theresa May's personality that she is 270 00:15:42,600 --> 00:15:47,400 Speaker 1: not a particularly collaborative individual. And secondly, in the UK 271 00:15:47,840 --> 00:15:52,400 Speaker 1: politics are very polarized. It's very party politics based, and 272 00:15:52,440 --> 00:15:56,480 Speaker 1: it's also very tribal. People stick with their own tribe 273 00:15:56,600 --> 00:15:59,640 Speaker 1: come what may, and so the idea that you actually 274 00:15:59,680 --> 00:16:02,080 Speaker 1: have some sort of grand coalition, as you might have 275 00:16:02,200 --> 00:16:06,160 Speaker 1: in Germany is totally anathma to our system. On the 276 00:16:06,160 --> 00:16:08,800 Speaker 1: other hand, it would have been strategically clever to have 277 00:16:08,840 --> 00:16:12,120 Speaker 1: actually got chatting to the other side from the summer 278 00:16:12,120 --> 00:16:15,040 Speaker 1: of six because then they would have been forced to 279 00:16:15,320 --> 00:16:18,080 Speaker 1: buy into whatever was produced. It would be very hard 280 00:16:18,360 --> 00:16:20,200 Speaker 1: for them to vote against, so we wouldn't have been 281 00:16:20,200 --> 00:16:22,600 Speaker 1: where we are now. So, Professor, I think one question 282 00:16:22,640 --> 00:16:24,920 Speaker 1: that I've been asked again and again and again over 283 00:16:24,960 --> 00:16:26,800 Speaker 1: here in New York is when is the real deadline? 284 00:16:26,800 --> 00:16:30,040 Speaker 1: When do we have that grease type crisis moments summit 285 00:16:30,160 --> 00:16:32,880 Speaker 1: over in Europe where it hits midnight and I can't 286 00:16:32,960 --> 00:16:35,360 Speaker 1: kick the can down a road any longer? Professor? Is 287 00:16:35,360 --> 00:16:40,640 Speaker 1: it this week? Possibly possibly Wednesday night? Because this is 288 00:16:40,680 --> 00:16:45,960 Speaker 1: the EU emergency EU summit And if they say no 289 00:16:46,240 --> 00:16:49,480 Speaker 1: to us, if remember the mayor or an extension to 290 00:16:49,800 --> 00:16:52,360 Speaker 1: the June. If they say no to us, you can't 291 00:16:52,400 --> 00:16:55,360 Speaker 1: have any more extensions, then there really will be a crime. 292 00:16:57,080 --> 00:16:58,880 Speaker 1: Can you give us? Can you give us like eight 293 00:16:58,920 --> 00:17:04,199 Speaker 1: or ten pm ones night? Yeah? Absolutely, I'll come and 294 00:17:04,240 --> 00:17:07,480 Speaker 1: tell you, but that that really is a country that 295 00:17:07,520 --> 00:17:10,320 Speaker 1: the odd thing is although actually with due to leave 296 00:17:10,440 --> 00:17:13,320 Speaker 1: the EU without a deal on Friday at eleven pm 297 00:17:13,320 --> 00:17:17,119 Speaker 1: on Friday, there's not a sense of crisis at the moment, 298 00:17:17,240 --> 00:17:19,760 Speaker 1: So I think most people think that you will give 299 00:17:19,800 --> 00:17:22,760 Speaker 1: us an extension. The million dollar question is what's the 300 00:17:22,840 --> 00:17:26,080 Speaker 1: data that extension. Will it be only to the twenty 301 00:17:26,080 --> 00:17:28,480 Speaker 1: second of May, Why is that important? That's the day 302 00:17:28,520 --> 00:17:30,600 Speaker 1: of the European poem to elections, which at the moment 303 00:17:30,600 --> 00:17:35,360 Speaker 1: we're not participating in. Or will it be unlikely that's 304 00:17:35,359 --> 00:17:38,240 Speaker 1: what Truason they want unlikely? Or will it be a 305 00:17:38,320 --> 00:17:41,119 Speaker 1: year hence, and that's what Donalds could be present of 306 00:17:41,119 --> 00:17:44,200 Speaker 1: the European Council talking about. Well, I must admit Fox, 307 00:17:44,280 --> 00:17:48,080 Speaker 1: my observation of ten pm at night watching this in 308 00:17:48,160 --> 00:17:51,159 Speaker 1: London is totally different than from the distance of the 309 00:17:51,240 --> 00:17:55,960 Speaker 1: United States of America. There's something about late night parliamentary meetings. 310 00:17:56,000 --> 00:17:58,639 Speaker 1: It's like did you enjoy that? It was like I 311 00:17:58,680 --> 00:18:01,960 Speaker 1: did not enjoy it, but no, it was not like theater. 312 00:18:02,040 --> 00:18:04,280 Speaker 1: It was like exhaustion. I always forget one of one 313 00:18:04,280 --> 00:18:07,359 Speaker 1: issue country the UK has become, and then I go 314 00:18:07,480 --> 00:18:09,840 Speaker 1: back and realize and I'm reminded of it. Catherine, I 315 00:18:09,920 --> 00:18:12,159 Speaker 1: just wonder the Labor Party has actually done quite a 316 00:18:12,200 --> 00:18:13,879 Speaker 1: decent job of trying to make it more than just 317 00:18:13,920 --> 00:18:16,199 Speaker 1: about one issue. In fact, maybe that explains some of 318 00:18:16,200 --> 00:18:19,080 Speaker 1: the success that Jeremy Corbyn had in the previous election. 319 00:18:19,359 --> 00:18:21,359 Speaker 1: If we went to another election, would it be in 320 00:18:21,400 --> 00:18:25,040 Speaker 1: one issue election? Well, that's a million dollar question because 321 00:18:25,160 --> 00:18:28,600 Speaker 1: Jeremy Corbyn has really tried to talk about other things 322 00:18:28,600 --> 00:18:34,919 Speaker 1: apart from Brexit. Brexit has completely convulsed the Conservative Party. UM. 323 00:18:35,320 --> 00:18:37,840 Speaker 1: But if there is a general election, there's not one 324 00:18:37,920 --> 00:18:41,240 Speaker 1: due to two but most people think it's likely to 325 00:18:41,280 --> 00:18:44,560 Speaker 1: occur Before that, the parties will have to write manifestos 326 00:18:44,640 --> 00:18:46,879 Speaker 1: to say what they want. And the manifestos won't just 327 00:18:46,960 --> 00:18:49,560 Speaker 1: have one issue on at Brexit, but it also have 328 00:18:50,400 --> 00:18:55,640 Speaker 1: issues about the health service, education, public spending and so forth. UM. 329 00:18:55,760 --> 00:18:58,640 Speaker 1: But in reality there's a good chance that it will 330 00:18:58,680 --> 00:19:01,520 Speaker 1: be on Brexit because they'll have to write a paragraph 331 00:19:01,680 --> 00:19:03,480 Speaker 1: or two to say what do we want out of 332 00:19:03,480 --> 00:19:07,400 Speaker 1: the future relationship. One final question, Professor, and this goes 333 00:19:07,440 --> 00:19:12,000 Speaker 1: to your expertise. Explain to our audience what European parliamentary 334 00:19:12,080 --> 00:19:15,399 Speaker 1: votes mean. What what are the British people vote? Who's 335 00:19:15,480 --> 00:19:19,280 Speaker 1: voting in Britain for EU parliament votes? Is that the 336 00:19:19,400 --> 00:19:24,320 Speaker 1: nation votes? Yeah, So there's European parlant elections every five 337 00:19:24,440 --> 00:19:27,680 Speaker 1: years when all of the states or of the EU 338 00:19:27,760 --> 00:19:31,280 Speaker 1: twenty seven or EU twenty eight will send m ep 339 00:19:31,480 --> 00:19:35,240 Speaker 1: s members of the European Parliament to sit in Strasbourg 340 00:19:35,920 --> 00:19:39,000 Speaker 1: and the elections take place pretty much on the same 341 00:19:39,080 --> 00:19:42,240 Speaker 1: day sent me around the same weekend across Europe. And 342 00:19:42,320 --> 00:19:45,760 Speaker 1: at the moment, the UK's seventy odd seats in the 343 00:19:45,800 --> 00:19:50,480 Speaker 1: European Parliament have been partially redistributed to the EU seven 344 00:19:50,520 --> 00:19:54,480 Speaker 1: to the remaining member state, but that needs to be unpicked. 345 00:19:54,720 --> 00:19:59,040 Speaker 1: If we have an extension beyond June, we will have 346 00:19:59,080 --> 00:20:02,840 Speaker 1: to participate in European Poems elections and we will steats 347 00:20:02,840 --> 00:20:05,919 Speaker 1: will have to be retained for the UK. And the 348 00:20:05,920 --> 00:20:08,679 Speaker 1: European Poems is actually rather important body now. At the 349 00:20:08,680 --> 00:20:10,359 Speaker 1: beginning when it was set up, it was nearly a 350 00:20:10,359 --> 00:20:13,240 Speaker 1: sort of assembly and a talking shop. Now it's what's 351 00:20:13,280 --> 00:20:17,280 Speaker 1: called a co legislature in most areas, so it's got 352 00:20:17,320 --> 00:20:22,480 Speaker 1: really significant powers in making EU legislation which is binding 353 00:20:22,480 --> 00:20:27,800 Speaker 1: on the most valuable Catherine Bernard, thank you so Cambridge 354 00:20:27,880 --> 00:20:32,560 Speaker 1: University just immensely enjoy speaking to her other real expertise 355 00:20:32,680 --> 00:20:45,320 Speaker 1: versus the country. Try. Okay, here's the ballet fogs. If 356 00:20:45,320 --> 00:20:48,240 Speaker 1: you work for a firm and you're doing a deal, 357 00:20:48,400 --> 00:20:50,960 Speaker 1: it makes complete sense that if you're directly involved with 358 00:20:51,000 --> 00:20:54,280 Speaker 1: that deal, you can't comment on it in the media. 359 00:20:55,080 --> 00:20:58,560 Speaker 1: And then, far more importantly, if you're tangential to a 360 00:20:58,680 --> 00:21:03,560 Speaker 1: transaction under way, it's usually very clear that you cannot 361 00:21:03,600 --> 00:21:06,720 Speaker 1: talk about it in the media. And then there's the 362 00:21:06,840 --> 00:21:09,639 Speaker 1: idea of this is Bloomberg's surveillance, and we spread we 363 00:21:09,680 --> 00:21:13,360 Speaker 1: respect the pressure that our guests under So even if 364 00:21:13,359 --> 00:21:16,040 Speaker 1: he was tangential, and even if he was as brilliant 365 00:21:16,040 --> 00:21:18,520 Speaker 1: as he is, we wouldn't be rude to Bob Michael 366 00:21:18,520 --> 00:21:21,959 Speaker 1: and asked him about the Saudi transaction. We would we 367 00:21:22,000 --> 00:21:24,520 Speaker 1: would not do that as he is with JP Morgan, 368 00:21:24,560 --> 00:21:26,879 Speaker 1: and of course JP Morgan out trying to do the 369 00:21:26,880 --> 00:21:30,840 Speaker 1: book on this uh huge and historic transaction. Bob. What 370 00:21:30,920 --> 00:21:34,760 Speaker 1: I can do is ask you in fixed income about 371 00:21:35,000 --> 00:21:40,440 Speaker 1: globally the insatiable demand for paper Boy does it ring 372 00:21:40,520 --> 00:21:44,600 Speaker 1: of two thousand and six? Is it the same? Good 373 00:21:44,600 --> 00:21:49,200 Speaker 1: Morning Tom? It does? And this is both a good 374 00:21:49,200 --> 00:21:52,200 Speaker 1: time and a challenging time to be a bond investor. 375 00:21:52,840 --> 00:21:56,080 Speaker 1: The good part of it are the central banks tostill 376 00:21:56,320 --> 00:21:59,240 Speaker 1: have taken a lot of pressure off of the market, 377 00:21:59,680 --> 00:22:02,479 Speaker 1: so you don't have to worry about yields continuing to 378 00:22:02,520 --> 00:22:05,680 Speaker 1: go higher and the balance sheet running down. The bad 379 00:22:05,880 --> 00:22:08,640 Speaker 1: is that this is all you're gonna get. You're gonna 380 00:22:08,720 --> 00:22:12,960 Speaker 1: get two and a half percent ten year treasury and 381 00:22:13,119 --> 00:22:15,600 Speaker 1: you're going to get credit spreads. If you look at 382 00:22:15,640 --> 00:22:18,719 Speaker 1: some of these new TRANSACTIONSY referenced in the market at 383 00:22:18,720 --> 00:22:21,520 Speaker 1: a hundred basis points over, but you've got to buy it. 384 00:22:21,560 --> 00:22:23,639 Speaker 1: There's not a lot of inflation out there. There's not 385 00:22:23,680 --> 00:22:26,360 Speaker 1: a lot of inflation, and there's not a lot of substitutes. 386 00:22:26,560 --> 00:22:29,359 Speaker 1: Now I don't mean and again, Mr Michael, seriously, folks 387 00:22:29,720 --> 00:22:32,840 Speaker 1: can't talk about this transaction. But there seems to be 388 00:22:32,960 --> 00:22:36,199 Speaker 1: an idea in fixed income that I need to buy bills, 389 00:22:36,240 --> 00:22:40,680 Speaker 1: notes and paper because I don't trust dividend yield. I mean, 390 00:22:40,800 --> 00:22:43,760 Speaker 1: what's the what's the dialectic if you would almost between 391 00:22:44,200 --> 00:22:46,760 Speaker 1: fixed income people looking at a dividend, is a is 392 00:22:46,800 --> 00:22:52,040 Speaker 1: a yield proxy? Well of course we do, but but 393 00:22:52,160 --> 00:22:56,120 Speaker 1: you've got to look at a company's ability to continue 394 00:22:56,520 --> 00:23:00,760 Speaker 1: to increase its dividend on an annual basis. Because the 395 00:23:00,760 --> 00:23:03,439 Speaker 1: one thing we know about fixed income you have the 396 00:23:03,520 --> 00:23:07,679 Speaker 1: reinvestment and compounding of interest. I think that for us, 397 00:23:07,720 --> 00:23:10,720 Speaker 1: the interesting dynamic and fixed income is so much money 398 00:23:10,720 --> 00:23:13,280 Speaker 1: has gone into cash and short duration over the last 399 00:23:13,320 --> 00:23:16,800 Speaker 1: three years. That's waiting on the sidelines, waiting to come 400 00:23:16,880 --> 00:23:19,520 Speaker 1: into the fixed income markets. And what is so important 401 00:23:19,520 --> 00:23:21,720 Speaker 1: there is a verse short duration, folks. If you buy 402 00:23:21,720 --> 00:23:25,320 Speaker 1: two year maturity, there's this massive desire to go out 403 00:23:25,320 --> 00:23:28,520 Speaker 1: to a five year maturity, five year out the tenure, ETCeteras. 404 00:23:28,560 --> 00:23:30,399 Speaker 1: That's what's going on. I know people want to extend 405 00:23:30,440 --> 00:23:34,600 Speaker 1: maturities even though they can't, they do. Everyone's scrambling for 406 00:23:34,760 --> 00:23:39,600 Speaker 1: ye right now, we'll continue Bob on that idea. I mean, 407 00:23:39,640 --> 00:23:44,800 Speaker 1: scrambling absolutely captures, it doesn't And and so they're they're 408 00:23:44,840 --> 00:23:47,520 Speaker 1: they're going out further on the yield curve. The flatness 409 00:23:47,520 --> 00:23:50,400 Speaker 1: of the yield curve is a bit frustrating. So they're 410 00:23:50,440 --> 00:23:54,480 Speaker 1: going into credit to pick up incremental yield. They're they're 411 00:23:54,480 --> 00:23:57,240 Speaker 1: going down in credit to pick up even more yield, 412 00:23:57,400 --> 00:23:59,960 Speaker 1: and then they're going into the emerging markets. I mean, 413 00:24:00,000 --> 00:24:02,600 Speaker 1: I remember, Bob and in folks. The good news is, 414 00:24:02,600 --> 00:24:05,120 Speaker 1: I forget what the deal was. Was a bond deal 415 00:24:05,240 --> 00:24:08,240 Speaker 1: in like oh, six oh five whatever, where people were 416 00:24:08,240 --> 00:24:12,760 Speaker 1: scrambling for seven basis points seven one hundreds of a 417 00:24:12,880 --> 00:24:16,560 Speaker 1: percent yield and I gotta have that piece of paper. 418 00:24:16,760 --> 00:24:20,760 Speaker 1: Is it that silly right now? It's not that silly 419 00:24:21,040 --> 00:24:24,360 Speaker 1: right now because there has been a lot of corporate 420 00:24:24,400 --> 00:24:28,359 Speaker 1: issuance over the last few years that's still slashing around 421 00:24:28,359 --> 00:24:33,359 Speaker 1: in the market. There's more issuance materializing in the bond 422 00:24:33,400 --> 00:24:37,040 Speaker 1: market right now, so supply is rising to meet demand. 423 00:24:37,160 --> 00:24:40,840 Speaker 1: In here, Bob and in folks with us Robert Michael, 424 00:24:40,840 --> 00:24:44,520 Speaker 1: Bob Michael JP Morgan Asset Management, Chief investment officer and 425 00:24:44,520 --> 00:24:47,359 Speaker 1: a head of global fixed income as well. Buried in 426 00:24:47,440 --> 00:24:51,760 Speaker 1: your lengthy research is a great spreadsheet of expansion and 427 00:24:51,840 --> 00:24:57,639 Speaker 1: contraction as compared to the drivers, the monetary environment and 428 00:24:57,680 --> 00:25:01,359 Speaker 1: the market and positioning. This is a famous Michael billboard. 429 00:25:01,560 --> 00:25:03,479 Speaker 1: Give us the value of that right now. Are we 430 00:25:03,560 --> 00:25:08,440 Speaker 1: in expansion? Are we in a contraction? We're most certainly 431 00:25:08,720 --> 00:25:12,199 Speaker 1: in expansion. If you look at the employment data, it 432 00:25:12,280 --> 00:25:15,800 Speaker 1: continues to reflect that we're pretty much at full employment. 433 00:25:16,080 --> 00:25:20,040 Speaker 1: Wages are going up moderately. But the pleasing thing about 434 00:25:20,119 --> 00:25:24,359 Speaker 1: this expansion is it's it's growing at trend or just 435 00:25:24,480 --> 00:25:29,719 Speaker 1: above trend, so it's not overheating resources and increasing inflation, 436 00:25:30,119 --> 00:25:33,639 Speaker 1: which would get the FED to react negatively by raising 437 00:25:33,760 --> 00:25:37,679 Speaker 1: rates and continuing to run down its balance sheet. And then, okay, 438 00:25:37,760 --> 00:25:39,680 Speaker 1: if that's the case, where do you want a place 439 00:25:39,800 --> 00:25:42,160 Speaker 1: right now? You mentioned going to credit. Do I want 440 00:25:42,240 --> 00:25:43,880 Speaker 1: full face and credit or do I want to buy 441 00:25:43,880 --> 00:25:49,960 Speaker 1: garbage credit to pick up yield until there's a recession 442 00:25:50,359 --> 00:25:53,840 Speaker 1: that's imminent, say within the next six months, you want 443 00:25:53,880 --> 00:25:56,800 Speaker 1: to own credit and you want to go down in 444 00:25:56,880 --> 00:26:00,720 Speaker 1: credit rating because you're getting paid for of that yield. 445 00:26:01,560 --> 00:26:04,720 Speaker 1: Without a recession, company should be able to service their 446 00:26:04,800 --> 00:26:07,480 Speaker 1: dot Bob Michael, thank you so much, with JP Morgan 447 00:26:07,520 --> 00:26:16,040 Speaker 1: greatly greatly appreciated. Thanks for listening to the Bloomberg Surveillance podcast. 448 00:26:16,440 --> 00:26:21,440 Speaker 1: Subscribe and listen to interviews on Apple Podcasts, SoundCloud, or 449 00:26:21,520 --> 00:26:25,840 Speaker 1: whichever podcast platform you prefer. I'm on Twitter at Tom 450 00:26:25,920 --> 00:26:29,800 Speaker 1: Keane before the podcast. You can always catch us worldwide. 451 00:26:30,240 --> 00:26:31,320 Speaker 1: I'm Bloomberg Radio.