WEBVTT - Recession Warnings Mount for U.S. Economy 0:00:01.800 --> 0:00:04.400 This is Bloomberg Business Week. I'm Carol Masser and I'm 0:00:04.440 --> 0:00:07.280 Bloomberg Quick Takes Tim Stanobek. We're here every day bringing 0:00:07.280 --> 0:00:09.840 you the latest news from the world of business and finance, 0:00:09.840 --> 0:00:13.640 plus technology, politics, economics, all partnising the power of Business 0:00:13.640 --> 0:00:17.119 Week reporters and editors, not to mention our journalists and 0:00:17.160 --> 0:00:20.000 analyst in more than one twenty countries. You can download 0:00:20.000 --> 0:00:23.239 Bloomberg Business Week at iTunes, SoundCloud, or Bloomberg dot Com. 0:00:23.400 --> 0:00:25.160 You can also listen to our radio show at two 0:00:25.160 --> 0:00:27.840 pm Eastern Time on Bloomberg Radio, or watch us on 0:00:27.880 --> 0:00:31.960 YouTube search Bloomberg Global News. The U S economy is 0:00:31.960 --> 0:00:34.239 starting to show some signs of strain under the weight 0:00:34.280 --> 0:00:38.360 of decades high inflation and climbing interest rates, raising the 0:00:38.440 --> 0:00:41.680 risk of a downturn. Bloomberg News Economics reporter Rich Miller 0:00:41.760 --> 0:00:45.440 writes about this today, Rich joining us from our Washington 0:00:45.479 --> 0:00:48.279 at d C bureau. Rich, good to have you with us. 0:00:48.520 --> 0:00:51.680 Um what we see, what's happening with the financial markets, 0:00:51.720 --> 0:00:55.120 But if you look beyond those, where are you starting 0:00:55.200 --> 0:00:59.760 to see weakness in the economy. Yeah. I want to 0:00:59.800 --> 0:01:01.840 just make sure that we we understand that you know 0:01:01.880 --> 0:01:04.760 that the economy still has some you know, strong points, 0:01:04.760 --> 0:01:07.720 but but there are like cracks showing in that sort 0:01:07.760 --> 0:01:12.720 of strong facade. UM. Consumers are starting to take on 0:01:12.800 --> 0:01:15.559 more debt. I mean they're faced with you know, uh 0:01:15.760 --> 0:01:21.800 decades high inflation, having to share out more money for um, food, gasoline. 0:01:22.120 --> 0:01:25.600 So consumers are staking taking on more debts. So that's 0:01:25.600 --> 0:01:30.319 a sign that there of some strain the UM. Small 0:01:30.400 --> 0:01:37.160 businesses are also UM turning gloomier UM. Last month, according 0:01:37.200 --> 0:01:43.360 to a DP the accounting firm, small businesses actually uh 0:01:42.480 --> 0:01:47.160 uh so their payroll shrink. That was partly because um, 0:01:47.520 --> 0:01:50.800 they don't feel they can keep keep on raising wages 0:01:51.120 --> 0:01:54.000 and therefore having trouble getting workers. And then, lastly, the 0:01:54.040 --> 0:01:55.960 housing market, which is kind of on the front line 0:01:56.000 --> 0:01:58.680 of the Fed's efforts to slow the economy. We've seen 0:01:58.720 --> 0:02:02.000 mortgage rates grow up at the at the fastest page 0:02:02.040 --> 0:02:05.280 for quite a some time, and and and and some 0:02:05.320 --> 0:02:08.760 signs of slowing down in the sort of frenetic housing 0:02:08.800 --> 0:02:12.000 market that we've had. And rich I mean, from the 0:02:12.040 --> 0:02:15.480 fetes perspective, would they be viewing these as cracks in 0:02:15.520 --> 0:02:19.000 the economy or merely just signs that maybe the economy 0:02:19.040 --> 0:02:25.040 is starting to cool. Uh, they're probably the ladder. They're 0:02:25.040 --> 0:02:29.120 probably sort of welcoming some signs that things are are 0:02:29.200 --> 0:02:32.799 are cooling down, and uh that's what they want to do. 0:02:32.880 --> 0:02:36.799 But you know, it's uh, what is it, Uh three 0:02:36.840 --> 0:02:41.760 little bears right, not to Goldie GOLDI lots, you can't 0:02:41.800 --> 0:02:44.000 you know, it's it's it's it's a fine line, right, 0:02:44.200 --> 0:02:47.320 you know. Uh, it's the same saying could be said 0:02:47.320 --> 0:02:49.560 at what we've seen in the stock market. They made 0:02:49.639 --> 0:02:52.600 very clear that they wanted to get financial conditions tighter, 0:02:52.639 --> 0:02:56.040 and that that meant they wanted uh, you know, tacitly. 0:02:56.120 --> 0:02:58.519 They we're saying, we wanted to see stock prices lower, 0:02:58.600 --> 0:03:02.000 and they've certainly gotten that, but they don't want to 0:03:02.160 --> 0:03:04.720 you know, they don't want to see them go so 0:03:04.880 --> 0:03:09.400 low that people get really discouraged and you know, stop 0:03:09.480 --> 0:03:12.160 buying and we get thrown into recessions. So it's, you know, 0:03:12.240 --> 0:03:14.960 they're walking a very very fine line here. So so 0:03:15.000 --> 0:03:18.720 what do you need to see to prove to you 0:03:19.560 --> 0:03:23.079 that the Fed can pull this off, that the economy 0:03:23.120 --> 0:03:26.240 will be you know, in the words of Goldilocks just right, 0:03:26.440 --> 0:03:28.679 or in the words of of J. Powell, perhaps a 0:03:28.760 --> 0:03:35.160 softish landing softish landing, right right, uh, or some people 0:03:35.200 --> 0:03:40.720 say a semi hard landing. But but anyway, um um, 0:03:40.760 --> 0:03:43.200 I guess the key is going to be inflation. I think, 0:03:43.400 --> 0:03:49.240 um um, they're the Fed is still sort of hoping, 0:03:49.960 --> 0:03:53.520 praying that you know, a good portion of the inflation 0:03:53.560 --> 0:03:56.360 we're seeing is due to the so called supply side. 0:03:57.440 --> 0:04:01.440 And you know, if inflation starts this signs abusing, then 0:04:01.480 --> 0:04:04.960 they won't have to raise rates quite as high high 0:04:05.080 --> 0:04:07.600 as as as they might have to, and that would 0:04:08.160 --> 0:04:10.320 increase the chances they'll pull off what, as you say, 0:04:10.360 --> 0:04:13.520 the softish landing. They've already almost sort of given up 0:04:13.520 --> 0:04:16.400 on a soft landing where you know, everything is perfect 0:04:16.480 --> 0:04:20.200 and you know, inflation comes down but unemployment doesn't go up. 0:04:20.240 --> 0:04:22.920 But it seems now the softish landing means, well, we're 0:04:22.920 --> 0:04:25.960 going to get some a little bit of pain in 0:04:26.360 --> 0:04:29.479 the economy and probably in the jobs market, but we 0:04:29.520 --> 0:04:33.440 won't get a recession. Well let's let's dig in on that, because, 0:04:33.480 --> 0:04:36.040 I mean, the consensus coming into this year among economists 0:04:36.080 --> 0:04:38.520 was that we were going to see a slowdown, a 0:04:38.560 --> 0:04:42.680 cool down, not necessarily a contraction. What is the balance 0:04:42.760 --> 0:04:44.880 of views right now when you look across the landscape. 0:04:44.880 --> 0:04:48.080 What are economy economists saying about the possibility now of 0:04:48.080 --> 0:04:53.840 a recession in the coming years. I think then the 0:04:54.120 --> 0:04:56.800 clear consensus is that we're going to avoid a recession. 0:04:56.960 --> 0:04:59.960 But the when you when you ask people about about 0:05:00.040 --> 0:05:03.200 what are the risks around your so called baseline forecast, 0:05:04.800 --> 0:05:07.839 the risks that we're going to have a recession are 0:05:08.480 --> 0:05:13.159 are rising. A survey that Bloomberg did within the last 0:05:13.440 --> 0:05:16.240 couple of weeks of a broad range of economists, I 0:05:16.320 --> 0:05:19.400 want to say about more than fifty economists showed that, 0:05:19.480 --> 0:05:21.800 you know, they expected a thirty percent chance of a 0:05:21.839 --> 0:05:24.480 recession within the next year. But that was up from like, 0:05:26.160 --> 0:05:30.599 uh fifteen percent of those uh thirty That was up 0:05:30.640 --> 0:05:34.000 from fifteen percent, say at the beginning of the year. 0:05:34.560 --> 0:05:38.479 So the consensus is still we're you know, we're going 0:05:38.520 --> 0:05:42.479 to avoid a recession, but the trends are not in 0:05:42.480 --> 0:05:45.560 the right direction. The number of people that the the 0:05:45.839 --> 0:05:49.400 risks that people assigned to the possibility recession arising, and 0:05:49.480 --> 0:05:52.680 actually growth forecasts are coming down. Bank of America today 0:05:53.160 --> 0:05:56.279 cut its growth forecast for the fourth quarter of next 0:05:56.400 --> 0:06:00.480 year too under a half percent, which is pretty riouslee 0:06:00.600 --> 0:06:04.760 close to zero or negative. So Rich, just in the 0:06:04.839 --> 0:06:07.799 last thirty seconds that we have with you very briefly, 0:06:08.440 --> 0:06:12.520 um Cane. You know, it's it's interesting because it's like 0:06:12.560 --> 0:06:14.880 we think about this from the perspective of FETE officials, 0:06:14.880 --> 0:06:17.440 when you think about it from the perspective of of people, 0:06:17.520 --> 0:06:21.240 but uh, what happens when people pull back because they're 0:06:21.240 --> 0:06:23.960 concerned about spending, Like it becomes self fulfilling in just 0:06:24.000 --> 0:06:28.960 fifteen seconds. Yeah, I mean that that that confidences is 0:06:29.000 --> 0:06:32.520 a key, key key keeping here and if confidence breaks 0:06:32.560 --> 0:06:35.640 and the economy will probably go into recession. It's just 0:06:35.720 --> 0:06:39.400 like you talked about yesterday, Katie with the self fulfilling properity, 0:06:40.960 --> 0:06:43.200 Rich Miller, this is a great piece. Check it out 0:06:43.240 --> 0:06:46.480 on the Bloomberg terminal. Riches economics reporter for Bloomberg News, 0:06:46.680 --> 0:06:49.960 joining us from our d C bureau. Rich, thanks so much. 0:06:49.960 --> 0:06:54.000 You're listening to Bloomberg Business Week on Bloomberg Radio. You're 0:06:54.040 --> 0:06:58.040 listening to Bloomberg Business Week with Carol Messer and Bloomberg 0:06:58.080 --> 0:07:01.960 Quick Takes Tim Stinovic on Bloomberg Radio. Well, the Port 0:07:01.960 --> 0:07:05.000 of Long Beach moved nine point three eight million containers 0:07:05.040 --> 0:07:08.479 in one that's set a record. Then came a record January, 0:07:08.800 --> 0:07:11.840 then came a record February, then came a record March, 0:07:12.320 --> 0:07:15.480 and then came a record April. What's the rest of 0:07:15.480 --> 0:07:19.080 the year looked like, especially as China lifts lockdowns. Well, 0:07:19.160 --> 0:07:22.080 Mario Cordero is the executive director at the Port of 0:07:22.080 --> 0:07:26.320 Long Beach. He joins us on the phone from Long Beach, California. Mario, 0:07:26.400 --> 0:07:29.080 how are you, How are you? Thank you? Thank you 0:07:29.120 --> 0:07:31.240 for the Yeah, it's it's really good to have you 0:07:31.280 --> 0:07:33.280 with us. So, so what does what is May looking like? 0:07:33.400 --> 0:07:36.200 And are we going to be seeing year over year 0:07:36.200 --> 0:07:40.520 records every month this year? Well, we're certainly seeing an 0:07:40.560 --> 0:07:42.840 uptick in terms of the cargo growth here at the 0:07:42.840 --> 0:07:45.880 prolonge that you've reference. We've had a record April and 0:07:45.920 --> 0:07:48.800 for that matter, for the first four months record numbers. 0:07:49.400 --> 0:07:51.320 As to what the rest of the year it looks like, 0:07:51.360 --> 0:07:53.200 I think in the next couple of months we're going 0:07:53.240 --> 0:07:55.640 to continue put an uptick, given that we're entering a 0:07:55.720 --> 0:07:59.240 peak season which ordinarily starts around July, and by that 0:07:59.360 --> 0:08:02.040 I mean the cargo that comes in preparation for the 0:08:02.120 --> 0:08:04.920 fall holiday season. And then as to the last quarter 0:08:04.920 --> 0:08:06.880 of the year, I think that remains to be seen, 0:08:06.920 --> 0:08:09.120 but definitely because of the lockdown and slowed down that 0:08:09.160 --> 0:08:12.400 we've seen in China, that is the zero COVID policy 0:08:12.480 --> 0:08:14.760 that they've implemented there. I think we're gonna have a 0:08:14.760 --> 0:08:18.200 domino effect once China ramps up, and you're gonna see 0:08:18.240 --> 0:08:21.400 that cargo coming again in some kind of a searge. Well, 0:08:21.440 --> 0:08:23.840 let's talk about the domino effect. You know, how are 0:08:24.240 --> 0:08:26.600 how is the Port of Long Beach going to try 0:08:26.640 --> 0:08:31.360 to prevent the congestion that we saw in one as 0:08:31.400 --> 0:08:34.800 we entered this peak season. What a good news is 0:08:34.800 --> 0:08:38.280 a result of the engagement of the White House, more 0:08:38.280 --> 0:08:41.960 specifically the White House Envoy, we've had for several months 0:08:42.320 --> 0:08:45.560 weekly calls for two or three times a week to 0:08:45.679 --> 0:08:50.200 address the various congestion issues. So I can represent to 0:08:50.240 --> 0:08:52.720 you that there's a full court press to address some 0:08:52.720 --> 0:08:55.520 of the issues that we're at the more serious level 0:08:55.960 --> 0:09:00.280 in the fall. And on one very positive metric, you know, 0:09:00.320 --> 0:09:02.800 in January this year, we had a hundred nine vessels 0:09:02.840 --> 0:09:05.760 off the coast. That number now is around thirty two. 0:09:06.080 --> 0:09:10.040 So I think, well, we're still gonna have some challenges. 0:09:10.320 --> 0:09:13.160 As you have probably know, every gate, every major gate 0:09:13.160 --> 0:09:15.600 with United States have the same challenge is given the 0:09:15.679 --> 0:09:18.959 import search here and the issues involving the disruption of 0:09:19.000 --> 0:09:21.760 global supply chain. However, I believe we're going to be 0:09:21.800 --> 0:09:24.160 in a better position to address some of the issues 0:09:24.200 --> 0:09:28.000 that really surfaced at a very high level a year ago. Maria, 0:09:28.040 --> 0:09:29.959 what about when it comes to labor, because last week 0:09:30.000 --> 0:09:32.320 saw the start of crucial labor talks between the dock 0:09:32.320 --> 0:09:35.520 worker union and employers, but with both parties saying that 0:09:35.559 --> 0:09:38.320 they expect cargo to keep moving until an agreement as 0:09:38.320 --> 0:09:40.240 which reach, do just give us an indication of how 0:09:40.280 --> 0:09:43.400 these talks are going well. As you may know, I'm 0:09:43.440 --> 0:09:46.880 not privy to the talks that I'm not in the room. However, uh, 0:09:47.000 --> 0:09:51.079 in my view, given h the engagement with the parties 0:09:51.720 --> 0:09:55.280 throughout this process of stakeholder engagement prior to the negotiations, 0:09:55.720 --> 0:09:59.520 I'm optimistic that the parties will reach their differences or 0:09:59.600 --> 0:10:02.640 resolved differences in the reasonable period of time. I mean, 0:10:02.679 --> 0:10:05.079 the fact of the matter is that here at this 0:10:05.200 --> 0:10:07.400 port complex, the largest in the nation that is between 0:10:07.400 --> 0:10:10.400 Pearl Long Beach and Pearl Los Angeles, we moved an 0:10:10.400 --> 0:10:15.000 excess of twenty million containers. So and large part is 0:10:15.040 --> 0:10:17.040 because of the productivity that labor has had. So I 0:10:17.080 --> 0:10:20.280 don't expect any slowdown with regard to the productivity on 0:10:20.320 --> 0:10:22.600 the part of labor. Well, can you talk about what 0:10:22.679 --> 0:10:26.040 contingencies you have in place to prevent that slowdown, I mean, 0:10:26.080 --> 0:10:30.080 shoulder an agreement not be reached. Well, I think the 0:10:30.080 --> 0:10:31.920 good news is what we've been able to do during 0:10:31.920 --> 0:10:35.720 this crisis. As one example, extended gate hours, you know, 0:10:35.760 --> 0:10:38.080 to keep the fluidity of the cargo moving. You know, 0:10:38.120 --> 0:10:43.040 some of these terminals have a weekend hours. Our terminal 0:10:43.120 --> 0:10:46.520 t t I, we have a seven pilot project, uh 0:10:46.559 --> 0:10:48.720 and of course the same on the part of Los Angeles. 0:10:48.800 --> 0:10:52.640 So I think we have implemented measures to again make 0:10:52.679 --> 0:10:54.920 sure that we keep some fluidity in the movement of cargo. 0:10:55.640 --> 0:10:59.720 So and with that, we've also identified land in terms 0:10:59.760 --> 0:11:01.920 of at the Acrede where this card was being moved 0:11:02.000 --> 0:11:05.839 off the terminals. So again I I don't expect to 0:11:05.880 --> 0:11:09.320 slow down by labor, and I think for us we 0:11:09.360 --> 0:11:12.600 are certainly better prepared to address any type of scenaria, 0:11:12.640 --> 0:11:15.520 and maybe we were a year ago. So I think 0:11:15.559 --> 0:11:17.360 that's the good news in terms of what we're seeing 0:11:17.679 --> 0:11:21.400 addressing all the issues relevant to the movement of cargo here. Hey, Mario, 0:11:21.480 --> 0:11:25.319 We've talked to CEOs at some companies over the last 0:11:25.360 --> 0:11:26.880 few months, and they've told us that one of the 0:11:26.880 --> 0:11:29.160 ways they've dealt with poor congestion at the ports of 0:11:29.360 --> 0:11:32.240 Los Angeles and Long Beach is to actually go and 0:11:32.400 --> 0:11:35.920 use other ports uh north of you, and then also 0:11:36.360 --> 0:11:38.880 completely other other ports on the other side of the country. 0:11:39.240 --> 0:11:43.080 What are you doing to avoid losing market share? Well, 0:11:43.160 --> 0:11:46.439 I think this has been an ongoing dynamic for several years, 0:11:46.440 --> 0:11:49.200 that is the loss of incremental market share here at 0:11:49.240 --> 0:11:52.760 the West coast, more specifically at the largest nation, largest 0:11:52.800 --> 0:11:55.719 port of conflict. Now you know other gateways be a 0:11:56.160 --> 0:11:59.880 New York to Jersey, Savannah, Charleston, Houston, They've all done 0:11:59.880 --> 0:12:04.400 a great job in uplifting their respective infrastructure. So certainly 0:12:04.600 --> 0:12:07.640 we are very concussant that shippers have a choice. On 0:12:07.679 --> 0:12:10.199 the other hand, I think that this gateway here is 0:12:10.240 --> 0:12:13.120 the most is the gateway most approximate the most important 0:12:13.160 --> 0:12:16.480 trade reason to this country to the USA, which is Asia. 0:12:17.160 --> 0:12:19.200 And at the end of the day, we could move 0:12:19.240 --> 0:12:23.080 that container to Chicago to the Midwest faster than any 0:12:23.120 --> 0:12:25.559 direct service to the go for to the East. That 0:12:25.720 --> 0:12:28.679 dynamic will continue. I think our partnership with the railroads 0:12:28.960 --> 0:12:31.040 and the substitut discussions when we're having with them to 0:12:31.080 --> 0:12:34.840 make sure we keep competitive well well again in my opinion, 0:12:35.280 --> 0:12:39.040 uh remain we will remain competitive. Now again, I want 0:12:39.040 --> 0:12:40.560 to say one thing that if you look at these 0:12:40.559 --> 0:12:42.600 other gateways, I mean just in the news this week, 0:12:42.640 --> 0:12:45.520 it's very briefly ten seconds go ahead, and then news 0:12:45.520 --> 0:12:47.280 this week the congestion is happening in New York and 0:12:47.320 --> 0:12:50.480 New Jersey. So this is a dynamic every major gateways. 0:12:50.520 --> 0:12:53.760 Addressing Mario Cordero, executive director at the Port of Long Beach, 0:12:55.280 --> 0:12:59.359 This is Bloomberg Business Week with Carol Masser and Bloomberg 0:12:59.400 --> 0:13:03.400 Quick Takes Tim Stenovic on Bloomberg Radio. Well. According to 0:13:03.440 --> 0:13:06.680 the World Health Organization, the coronavirus pandemic has directly and 0:13:06.920 --> 0:13:11.440 indirectly killed nearly fifteen million people around the world. So 0:13:11.480 --> 0:13:14.840 how do we prevent the next pandemic? It's the question 0:13:14.920 --> 0:13:17.960 of a new book by Brian Bremner, Global Business Executive 0:13:18.080 --> 0:13:20.920 Editor here at Bloomberg News. He argues that it hinges 0:13:20.920 --> 0:13:25.520 on better understanding the billions of tiny pathogens circulating in nature. 0:13:25.800 --> 0:13:28.520 Brian Bremner is Global Business Executive Editor. He joins us 0:13:28.520 --> 0:13:30.840 on the phone from London. Joel Weber is the editor 0:13:31.120 --> 0:13:33.560 at bloom of Bloomberg business Week. He joins us on 0:13:33.600 --> 0:13:36.880 the access line from Brooklyn. This story is featured in 0:13:36.920 --> 0:13:39.960 the new issue of Business Week magazine. It's available on newsstands, 0:13:40.040 --> 0:13:43.200 on the Bloomberg terminal, and at Bloomberg dot com slash 0:13:43.320 --> 0:13:47.319 business Week. So, Joel, why are why are these teeny 0:13:47.360 --> 0:13:51.920 tiny invisible things so crucial to understand? Yeah, they're not invisible. 0:13:51.920 --> 0:13:54.080 You just gotta go super super small invisible. To me, 0:13:54.120 --> 0:13:56.760 it's the naked eye right there, you go? Right? Ok. So, 0:13:56.760 --> 0:13:59.640 so the microbe is sort of the thing that that 0:13:59.679 --> 0:14:02.120 Brian and went went long on here. And in addition 0:14:02.200 --> 0:14:05.520 to this remarks in the magazine, it's subject of his book, 0:14:05.600 --> 0:14:09.040 Man Versus Microbe. If you're a close watcher of Business Week, 0:14:09.040 --> 0:14:11.680 you may remember those words because in the very very 0:14:11.920 --> 0:14:15.520 very early days of the pandemic, right as we started 0:14:15.520 --> 0:14:18.640 to appreciate how big of a story this was gonna be, Uh, 0:14:18.679 --> 0:14:21.360 Brian and I talked and and he spilled up what 0:14:21.440 --> 0:14:24.520 became a very early cover story for us with the 0:14:24.560 --> 0:14:28.760 similar line Man versus microbe and as the pandemic went along, 0:14:28.760 --> 0:14:31.600 and Brian helped oversee so much of Bloomberg News is 0:14:31.680 --> 0:14:35.240 amazing coverage. Um. He got in urge to to pursue 0:14:35.240 --> 0:14:38.040 it as a book. And what I find fascinating about 0:14:38.080 --> 0:14:42.640 this is really how future orientated this idea is. Um. 0:14:42.800 --> 0:14:47.200 We're talking about virus. Obviously when we talk about um uh, 0:14:47.400 --> 0:14:52.080 covid um virus is one of many different microbes there there, 0:14:52.160 --> 0:14:54.800 and they are out there. We we've and our understanding 0:14:54.840 --> 0:14:59.200 of microbes is so limited. But and that's kind of 0:14:59.200 --> 0:15:01.960 where his reporting goes. UM and Al turn it up 0:15:01.960 --> 0:15:07.120 to him, Brian, what we are making progress uh, scientifically 0:15:07.680 --> 0:15:10.600 on this front um almost it feels now like probably 0:15:10.680 --> 0:15:15.280 daily right, But where where could things go? Well, it's 0:15:15.360 --> 0:15:18.280 it's a really interesting time because we're kind of in 0:15:18.320 --> 0:15:22.440 the third year of the pandemic. But the COVID pandemic 0:15:22.600 --> 0:15:27.479 is coincided with kind of a big transformation in biology. 0:15:27.680 --> 0:15:32.040 It's you know, we're now applying technologies like AI, big 0:15:32.120 --> 0:15:38.480 data analytics, automation and Crisper Genie editing technology. So we're 0:15:38.480 --> 0:15:42.680 now at a point where we can redesign the source 0:15:42.800 --> 0:15:46.800 code for for microbes and a lot of biological systems. 0:15:46.840 --> 0:15:50.040 And the reason that's important in the context of how 0:15:50.080 --> 0:15:54.400 do we get better at pandemic management is that this 0:15:54.400 --> 0:15:57.920 this crisis has taught us that if you let any 0:15:58.000 --> 0:16:03.280 kind of pathogen scale up into population centers, it's really 0:16:03.360 --> 0:16:07.960 game over. And this this pandemic are our battle with 0:16:08.120 --> 0:16:11.360 the with the virus really kind of ended in in 0:16:11.520 --> 0:16:16.040 March of when the hotspots around the world, you know, 0:16:16.120 --> 0:16:19.160 took off. And the reason is is that when you 0:16:19.240 --> 0:16:24.000 get to a certain scale, we tend to, you know, 0:16:24.120 --> 0:16:28.360 experience social disorder and we're on our back legs and 0:16:28.400 --> 0:16:31.240 we have to kind of make very very tough choices 0:16:31.320 --> 0:16:35.360 between saving lives and letting our economies collapse. And we 0:16:35.480 --> 0:16:38.640 don't want to be in that position, so we've tried. 0:16:38.680 --> 0:16:42.120 I think the answer if you talk to people who 0:16:42.160 --> 0:16:44.400 are who are devoting their careers to this, is that 0:16:44.480 --> 0:16:47.920 we've got to take this battle to the molecular level, 0:16:47.920 --> 0:16:52.160 and that means building a biosurveillance system that allows us 0:16:52.200 --> 0:16:55.920 to kind of track these pathogens really early when they're 0:16:56.000 --> 0:17:01.080 kind of circular circulating around nature and in animal communities, 0:17:01.400 --> 0:17:04.000 and then try to disrupt them or at least manage 0:17:04.040 --> 0:17:07.840 the you know, the outbreaks much earlier in the process 0:17:08.000 --> 0:17:11.359 before you kind of have that societal impact. Well, Brian, 0:17:11.960 --> 0:17:15.120 the challenge there is, you write in this excerpt of 0:17:15.160 --> 0:17:17.760 your new book Man Versus Microbe, what will it take 0:17:17.840 --> 0:17:21.760 to win, is that as humans were not really wired 0:17:21.800 --> 0:17:25.280 to react to risks that that we can't see or 0:17:25.400 --> 0:17:27.240 feel in the here and now. So, so how do 0:17:27.280 --> 0:17:32.080 we change that wiring? Well, it's difficult because you know, 0:17:32.119 --> 0:17:34.560 you're right, I mean, we're just you know, are The 0:17:34.560 --> 0:17:37.960 way we evolved was just to see a clear and 0:17:38.000 --> 0:17:42.000 present danger threats, you know, the snake slithering through the grass, 0:17:42.080 --> 0:17:44.639 or the you know, the car that jumps the media 0:17:44.680 --> 0:17:49.520 and and oncoming traffic and things like that. Biological events 0:17:49.760 --> 0:17:54.520 are slow moving, they're infrequent, and what it's what's happened 0:17:54.560 --> 0:17:58.919 if you look at the history of of infectious disease outbreaks, 0:17:59.000 --> 0:18:03.480 is that we get caught in this pattern of you know, panicking, 0:18:03.560 --> 0:18:08.760 freaking out, responding, rushing, you know, healthcare responses, and then 0:18:08.800 --> 0:18:12.200 when the crisis you know, passes, we kind of moved 0:18:12.240 --> 0:18:15.720 back into this position of studied in action. And the 0:18:15.840 --> 0:18:19.280 reason we can't do that any longer is that the 0:18:19.320 --> 0:18:24.959 cadence of these infectuous disease outbreaks this century have been increasing, 0:18:25.240 --> 0:18:29.320 and the reasons are for multi you know, fascinated. I mean, 0:18:29.359 --> 0:18:32.959 one big one is that humanity is just kind of 0:18:33.080 --> 0:18:37.480 encroaching on natural habitats. As we know, our mega cities 0:18:37.520 --> 0:18:42.800 take off in our industry, which is livestock intensive, keeps 0:18:42.920 --> 0:18:46.240 you know, expanding. So again we need to use our 0:18:46.320 --> 0:18:51.280 best technologies and build a surveillance system, you know, at 0:18:51.320 --> 0:18:53.359 the microbe level. We kind of have to take the 0:18:53.480 --> 0:18:57.400 contest to them rather than letting them kind of run 0:18:57.680 --> 0:19:01.439 wild in our populations owners, and and we we end 0:19:01.520 --> 0:19:05.240 up with these terrible situations where you know, Um, Brian, 0:19:05.280 --> 0:19:10.439 I'm I'm curious. Um uh. Some some buzzwords, uh have 0:19:10.600 --> 0:19:15.119 cameos in the excerpt, Um, but I'm really genuinely curious 0:19:15.160 --> 0:19:19.240 about how AI factors into this because what you're talking 0:19:19.240 --> 0:19:23.080 about here, the data sets are are obviously enormous. UM, 0:19:23.160 --> 0:19:26.320 and how is AI playing out in terms of how 0:19:26.359 --> 0:19:30.200 we could potentially meet meet the challenge that the microbe 0:19:30.240 --> 0:19:33.320 is presented. Yeah, when you talk to people in the 0:19:33.359 --> 0:19:37.840 worlds of biology and computer science, they're very excited about 0:19:38.520 --> 0:19:42.399 the possible applications of of AI and drug discovery. You know, 0:19:42.520 --> 0:19:47.439 just like mathematics was a very powerful descriptive language for 0:19:47.560 --> 0:19:51.280 physics less century. A lot of people think AI is 0:19:51.280 --> 0:19:54.720 going to help us decode the complexity of biology. And 0:19:54.720 --> 0:19:59.280 why is that, Well, so much of biology is becoming digital. 0:19:59.440 --> 0:20:02.119 You know, we're now out building these pretty big bio banks. 0:20:02.119 --> 0:20:06.159 When people you know, genetically sequence of microbe or a 0:20:06.280 --> 0:20:10.480 cell or complex of cells, that all gets stored away 0:20:10.600 --> 0:20:15.080 in databases that AI programs can kind of rifle through. 0:20:15.119 --> 0:20:18.040 And you know, one of the most dramatic examples of 0:20:18.080 --> 0:20:20.399 that was just happened a few years ago at m 0:20:20.480 --> 0:20:26.240 I T. We're synthetic biologist James Collins and his team 0:20:26.480 --> 0:20:31.240 used an AI program to rifle through like a hundred 0:20:31.680 --> 0:20:36.440 million chemical compounds. Gave them some instructions about what kind 0:20:36.480 --> 0:20:40.320 of antibiotic they might be interested in, and the program 0:20:40.440 --> 0:20:45.919 found it, and they found a structurally unique uh antibody 0:20:46.200 --> 0:20:51.160 antibiotic that they nicknamed Heels, you know, the creepy computer 0:20:51.280 --> 0:20:54.800 from two thousand and one. Brian, We're gonna have to 0:20:54.920 --> 0:20:57.560 leave it there just very quickly five seconds. Optimistic or 0:20:57.560 --> 0:21:04.000 pessimistic after writing this book, I'm optimistic optimistic there it is. 0:21:04.119 --> 0:21:07.480 Brian Bramer Global Business executive editor his new book out 0:21:07.520 --> 0:21:10.160 Man Versus Microbe What Will It Take to Win? Also 0:21:10.240 --> 0:21:13.080 joined by Joe Webber, the editor of Bloomberg Business Week. 0:21:13.160 --> 0:21:18.119 This is Bloomberg. You're listening to Bloomberg Business Week with 0:21:18.240 --> 0:21:23.600 Carol Messer and Bloomberg Quick Takes Tim Stinovic on Bloomberg Radio. Well, 0:21:23.640 --> 0:21:27.000 bitcoin is down nearly from its highs back in November. 0:21:27.440 --> 0:21:29.960 Terry us D and Luna have collapsed. We've covered that 0:21:30.040 --> 0:21:33.160 closely here over the last two weeks. What's it looking 0:21:33.200 --> 0:21:37.120 like when it comes to crypto at least in venture capital? 0:21:37.400 --> 0:21:39.760 For that, we turned to Rob Frasca, managing partner at 0:21:39.800 --> 0:21:43.440 Cosmo Ventures. It's a venture capital fund. It's tokenized to 0:21:43.520 --> 0:21:47.720 invest in early stage blockchain projects and opportunities. Rob, how 0:21:47.760 --> 0:21:51.879 are you. I'm doing great? How are you? We're doing well? 0:21:51.960 --> 0:21:53.760 I mean, you know, it is a bear market, but 0:21:54.040 --> 0:21:56.639 it is Friday. It is Friday, so yes, there's a 0:21:56.680 --> 0:22:01.440 silver lining to everything right arm this weekend? We are. Well, 0:22:01.440 --> 0:22:04.280 you're somebody who's seen You're somebody who's seen quite a 0:22:04.320 --> 0:22:07.480 few market cycles, and I'm wondering how you're viewing this 0:22:07.600 --> 0:22:10.800 specifically right now in your world, not in the world 0:22:10.840 --> 0:22:15.680 of public equities, but in the in the world of blockchain. Yeah. 0:22:15.720 --> 0:22:18.760 So I'm an early dot com guy. I get a 0:22:18.800 --> 0:22:23.200 budget companies through the whole kind of dot com life cycle. 0:22:24.040 --> 0:22:28.280 H took one public, took another one um and sold it. Uh. 0:22:28.840 --> 0:22:31.400 And so I you know, when I look at what's 0:22:31.400 --> 0:22:35.480 happening here, it's it's very similar. You know, tech grows exponentially, 0:22:36.000 --> 0:22:38.960 and generally what winds up happening in tech is there's 0:22:38.960 --> 0:22:41.879 a lot of excitement. Uh. And there's there and and 0:22:41.920 --> 0:22:45.160 that excitement of the promise of a new technology, people 0:22:45.240 --> 0:22:47.480 jump in and then you kind of get a little 0:22:47.480 --> 0:22:51.920 bit of over exuberance, uh, you know around that tech, 0:22:51.960 --> 0:22:54.439 and it tends to go a little bit beyond what 0:22:54.720 --> 0:22:59.440 it's promises at that moment. And you know, uh, you 0:22:59.480 --> 0:23:03.119 can't get caught up in kind of the short term volatility. 0:23:03.160 --> 0:23:07.440 If you really believe in a new technology, you really 0:23:07.480 --> 0:23:12.080 believe in what the capabilities are and the value creation 0:23:12.160 --> 0:23:14.760 it's going to be, Uh, then you've got to take 0:23:14.800 --> 0:23:19.359 a longer term focus. So I think that, you know, 0:23:19.480 --> 0:23:22.919 I always we invest in blockchain. We believe that blockchain 0:23:23.760 --> 0:23:26.680 is really I actually think it's bigger than the Internet. Itself. 0:23:27.000 --> 0:23:30.480 I think it's the single about Yeah, I had a single. 0:23:30.560 --> 0:23:33.080 Uh well, you know, when you think about the early 0:23:33.160 --> 0:23:35.160 days of the Internet, right, what was it all about. 0:23:35.200 --> 0:23:38.239 It was all about kind of peer to peer content, right, 0:23:38.240 --> 0:23:41.560 all of a sudden, anybody could create a content and 0:23:41.600 --> 0:23:44.000