WEBVTT - P&L: How Do We Replace Obamacare With Something That Works? 0:00:04.760 --> 0:00:08.080 Welcome to the Bloomberg P and L Podcast. I'm Pim Fox. 0:00:08.119 --> 0:00:11.200 Along with my co host Lisa Abramowitz. Each day we 0:00:11.280 --> 0:00:14.480 bring you the most important, noteworthy, and useful interviews for 0:00:14.520 --> 0:00:16.880 you and your money, whether at the grocery store or 0:00:16.920 --> 0:00:20.680 the trading floor. Find the Bloomberg pm L podcast on iTunes, 0:00:20.840 --> 0:00:28.479 SoundCloud and at Bloomberg dot com. I would like to 0:00:28.560 --> 0:00:32.800 learn more about what we have actually learned about healthcare 0:00:33.240 --> 0:00:36.520 under President elect Donald Trump. There has been a lot 0:00:36.600 --> 0:00:40.280 talked about about possibly provisions of Obamacare that could be repealed. 0:00:40.760 --> 0:00:42.360 But but I want to dig into what we have 0:00:42.479 --> 0:00:45.680 learned so far. Susan Dvore, she's the CEO of Premiere. 0:00:45.760 --> 0:00:49.080 It is a company that advises on how to reduce 0:00:49.080 --> 0:00:53.040 healthcare costs and improve outcomes at hospital systems around the country. 0:00:53.280 --> 0:00:54.880 Here in the studio with us. Thank you so much 0:00:54.880 --> 0:00:57.040 for being with us. Thank you. So what have we 0:00:57.080 --> 0:01:00.560 actually learned about the concrete proposals that are likely in 0:01:00.600 --> 0:01:04.280 a Trump administration that could change the outlook for hospitals. Well, 0:01:04.319 --> 0:01:07.480 we have heard over and over again repeal Obamacare, and 0:01:07.520 --> 0:01:10.800 while I think that's legislatively pretty easy to do, the 0:01:10.880 --> 0:01:13.840 question is how do we not go back to what 0:01:13.880 --> 0:01:16.920 we had before Obamacare? And how do we actually take 0:01:17.000 --> 0:01:20.320 waste out of the system, Have consumers involved in their 0:01:20.319 --> 0:01:24.039 health care pay for healthcare based on the value it's delivering. 0:01:24.120 --> 0:01:28.399 And so how do we replace Obamacare with something that works? Yes, 0:01:28.600 --> 0:01:32.480 and before President Trump takes over, we still have a 0:01:32.520 --> 0:01:35.840 few weeks left of the current Congress and administration. Can 0:01:35.880 --> 0:01:39.360 we expect anything from this lame duck Congress or is 0:01:39.400 --> 0:01:42.039 it just write it off? At this point? There is 0:01:42.080 --> 0:01:45.440 one really important thing that we Premiere think needs to 0:01:45.520 --> 0:01:48.760 happen in the lame duck Congress, which is how do 0:01:48.800 --> 0:01:53.240 you make these healthcare systems interoperable? How do you have 0:01:53.400 --> 0:01:57.320 your data as a patient, uh, get connected to all 0:01:57.320 --> 0:01:59.960 the other pieces of data about you? So right decisions 0:02:00.000 --> 0:02:02.720 are being made. You just talked about big data. Um. 0:02:02.760 --> 0:02:06.120 The question of interoperability is in a bill could pass, 0:02:06.560 --> 0:02:08.799 probably will pass, and could be done in the lame 0:02:08.919 --> 0:02:12.320 duck Congress that would move us forward uh faster. So 0:02:12.360 --> 0:02:15.600 basically would force hospital systems to get on a specific 0:02:15.600 --> 0:02:19.080 grid to It would force vendors, It would force all 0:02:19.120 --> 0:02:23.080 of these technology vendors to make their systems talk to 0:02:23.160 --> 0:02:26.400 one another. It's like having an iPhone that that you 0:02:26.440 --> 0:02:28.480 can't put any apps on today because none of it 0:02:28.520 --> 0:02:31.120 can be connected. They need to be forced to connect. 0:02:31.200 --> 0:02:35.120 What's the counter argument? The counter argument that often they 0:02:35.160 --> 0:02:38.920 will make is that patient privacy issue. So you have 0:02:39.000 --> 0:02:41.600 to make sure you can protect the patient information and 0:02:41.639 --> 0:02:45.639 the price privacy, but allow the patient to have connected information. 0:02:46.000 --> 0:02:48.600 And if you really want to solve big health care 0:02:48.680 --> 0:02:53.320 problems like the problem of stroke, the problem of diabetes, 0:02:53.360 --> 0:02:56.240 you need population based data, so you need to be 0:02:56.280 --> 0:02:59.119 able to connect the data at a population level as well. 0:02:59.480 --> 0:03:02.040 So it's like for a lot of people out there, 0:03:02.080 --> 0:03:05.600 the big question is we've seen our health insurance premiums 0:03:05.600 --> 0:03:10.040 go up year after year pretty alarming rates, and you know, 0:03:10.120 --> 0:03:13.920 you blame whoever you want on that um. President Trump 0:03:14.160 --> 0:03:18.040 has sort of promised to stop that um. But the 0:03:18.120 --> 0:03:21.399 question is something has to give in the whole chain there. 0:03:21.240 --> 0:03:25.840 Where do you expect the pressure to be uh focused 0:03:25.960 --> 0:03:28.919 in a Trump administration as far as lowering prices? What 0:03:28.919 --> 0:03:32.240 what sector of healthcare or the insurance industry do you 0:03:32.240 --> 0:03:35.400 expect to sort of come under the most scrutiny. Yes, 0:03:35.480 --> 0:03:37.560 So there's no simple answer here, right, this is like 0:03:37.600 --> 0:03:40.480 a game of Jenga where you have all these interrelated 0:03:40.520 --> 0:03:43.000 wooden pieces and if you pull one out at the 0:03:43.000 --> 0:03:48.280 wrong time, the whole thing collapses. Right. So the question is, well, 0:03:48.320 --> 0:03:51.440 the question is, how do you have all the participants 0:03:51.920 --> 0:03:57.320 in healthcare UH participate to to solve this problem. So 0:03:57.400 --> 0:04:01.400 from the perspective of hospitals and physicians and provider delivery systems, 0:04:02.040 --> 0:04:06.000 they are building value based systems. They're saying, pay us 0:04:06.040 --> 0:04:12.040 based on the clinical and economic value we deliver to consumers. 0:04:12.480 --> 0:04:17.000 Insurance companies have to take all of this regulatory reporting 0:04:17.000 --> 0:04:22.000 and all of this administrative paperwork out. Um, the suppliers 0:04:22.040 --> 0:04:26.159 and device companies have to find a way to help 0:04:26.240 --> 0:04:30.400 us curb the cost of high pharmaceuticals and medical devices. Well, 0:04:30.440 --> 0:04:34.400 you know, I'm looking at Tenant Healthcare's stock, which just 0:04:34.720 --> 0:04:37.680 plunged in the wake of UH Donald Trump's election as 0:04:37.720 --> 0:04:41.960 the next US president. I'm wondering what traders are looking 0:04:42.000 --> 0:04:46.360 at right now that's making them so barish on hospitals. 0:04:46.360 --> 0:04:49.320 I mean, what are they worried about in the in 0:04:49.360 --> 0:04:52.480 the new administration? You know, I think what they're missing 0:04:52.680 --> 0:04:56.880 is they're viewing hospitals as hospitals and they're not viewing 0:04:56.920 --> 0:05:00.279 hospitals as health care systems, so a lot of hospit battles. 0:05:00.360 --> 0:05:04.160 Most of the hospitals across the country have employed physicians, 0:05:04.160 --> 0:05:08.240 affiliated physicians, nursing home surgery centers, and they're taking care 0:05:08.279 --> 0:05:11.719 of populations, and they can move patients around into the 0:05:11.800 --> 0:05:15.640 delivery system to optimize the value and to lower the cost. 0:05:16.120 --> 0:05:20.000 If you look at a more pure hospital company, people 0:05:20.080 --> 0:05:24.280 are worried about the external pressure on cost in the 0:05:24.320 --> 0:05:28.039 hospital setting. If you look at an integrated delivery system 0:05:28.320 --> 0:05:31.480 where they can optimize how the patient is taken care 0:05:31.520 --> 0:05:34.279 of to lower the cost, that's a different thing. And 0:05:34.320 --> 0:05:37.200 I think that people are are pretty shortsighted in just 0:05:37.400 --> 0:05:39.960 the view of hospital in other words, just to sort 0:05:39.960 --> 0:05:42.320 of give some specifics, in other words, having urgy care 0:05:42.400 --> 0:05:45.760 centers and specific neighborhoods are sort of getting targeting high 0:05:45.839 --> 0:05:49.080 risk populations and getting them screenings earlier, and having these 0:05:49.080 --> 0:05:52.480 sort of other programs to to your point that committize costs. Right, 0:05:52.480 --> 0:05:55.840 So if you look at health care systems in communities, 0:05:56.240 --> 0:05:58.440 they're taking care of all these patients. These patients are 0:05:58.440 --> 0:06:00.640 going to show up in their emergency rooms, show up 0:06:00.640 --> 0:06:03.160 in their urgent care center, show up at their doctor's offices, 0:06:03.720 --> 0:06:06.080 and so we have to move to a system where 0:06:06.080 --> 0:06:10.040 they're paid based on the value across the continuum of care, 0:06:10.520 --> 0:06:13.159 not go back to a view of the world that 0:06:13.200 --> 0:06:15.880 you pay in silos. You pay a hospital silo, you 0:06:15.920 --> 0:06:18.760 pay a nursing home silo, you pay a physician silo. 0:06:19.400 --> 0:06:22.920 And I think that's what the new replacement to Obamacare 0:06:22.960 --> 0:06:27.120 will continue to do. One of the elements of Obamacare 0:06:27.160 --> 0:06:29.880 that created so much of the backlash was the notion 0:06:29.960 --> 0:06:34.960 that employers be mandated to provide coverage. Um, do you 0:06:35.000 --> 0:06:37.480 see that surviving Trump and and sort of what are 0:06:37.520 --> 0:06:41.760 how would you prioritize the changes we can expect under Trump? Yes, 0:06:41.839 --> 0:06:43.680 so there are no free lunches. So you can take 0:06:43.720 --> 0:06:46.560 away the individual and the employer mandate. But if you 0:06:46.600 --> 0:06:49.120 take that away, you've got to have a way to 0:06:49.360 --> 0:06:53.720 incent consumers to have healthcare coverage and to have it continuously, 0:06:54.200 --> 0:06:56.360 because what you don't want is people staying out of 0:06:56.400 --> 0:06:59.560 the system and then jumping in when they need healthcare. 0:07:00.000 --> 0:07:02.279 It's a very high cost way to do it. So 0:07:02.560 --> 0:07:05.640 I think what the Republicans will do is they will 0:07:05.720 --> 0:07:09.320 incent consumers by what it cost you if you jump 0:07:09.360 --> 0:07:12.800 in versus what it costs you if you have continuous coverage. 0:07:12.920 --> 0:07:15.600 So I think there are all are alternatives to the 0:07:15.640 --> 0:07:19.640 individual and employer mandate um that will drive continuous coverage. 0:07:19.680 --> 0:07:21.400 But we've got to we've got to have a system 0:07:21.400 --> 0:07:24.400 where people have coverage. Thank you so much. That was 0:07:24.440 --> 0:07:26.840 really fascinating. This is definitely one of the most important 0:07:26.840 --> 0:07:29.160 things to watch going forward, as as the population in 0:07:29.160 --> 0:07:33.000 the US does get older and as people increasingly depend 0:07:33.080 --> 0:07:36.559 on the health care system going forward, Susan divorce CEO 0:07:36.920 --> 0:07:41.160 of Premier, a company that goes into hospitals around the 0:07:41.200 --> 0:07:45.440 country and hospital systems and all of the outlying businesses 0:07:45.480 --> 0:07:47.920 that are related in order to make sure that quality 0:07:47.960 --> 0:07:51.760 is consistent and that costs are minimumized and that it's 0:07:51.760 --> 0:08:06.200 made more efficient. For some more direction, I want to 0:08:06.240 --> 0:08:09.040 bring a Mike Underhill, portfolio manager of the rich Worth 0:08:09.120 --> 0:08:13.080 Capital Innovations, Global Resources and Infrastructure Fund, to get some 0:08:13.160 --> 0:08:16.200 sense of this. Mike, is it time to invest in 0:08:16.240 --> 0:08:17.960 real assets or is it time? Is there going to 0:08:18.000 --> 0:08:20.480 be sort of a slow waning of that as people 0:08:20.520 --> 0:08:23.360 cycle into stocks. Well, it's a great question. When I 0:08:23.560 --> 0:08:26.640 look at the world we're in today, we continue to 0:08:26.680 --> 0:08:32.679 see investors posing questions around four themes volatility, uncertainty, complexity, 0:08:32.679 --> 0:08:36.319 and ambiguity. And you look at volatility, complements and ets 0:08:36.440 --> 0:08:39.040 other types of structured products. You look at the uncertainty. 0:08:39.080 --> 0:08:40.959 We've we've just passed the U S election, but we've 0:08:41.000 --> 0:08:44.120 got other milestones of uncertainty. You've got an OPEC meeting 0:08:44.160 --> 0:08:46.920 next week. You've got a bunch of different regulatory and 0:08:47.080 --> 0:08:51.040 policy shocks that potentially we're going to be experiencing over 0:08:51.080 --> 0:08:54.480 the next twelve months. The complexity and financial structures and 0:08:54.520 --> 0:08:56.839 the markets. And then the ambiguity. You've seen it in 0:08:56.920 --> 0:08:59.480 the bond market and you've seen it with the steepening 0:08:59.520 --> 0:09:03.360 of the yield. So what we're starting to see both 0:09:03.360 --> 0:09:05.760 in the equity markets and fixed income markets, you're seeing 0:09:05.760 --> 0:09:08.679 a need for more real asset income. And so investors, 0:09:08.720 --> 0:09:12.439 institutional investors and also individual investors are really focusing on 0:09:12.440 --> 0:09:15.320 what's going on with the reflationary trade. As I said, 0:09:15.360 --> 0:09:17.760 we've we've gone past the US elections now where we've 0:09:17.800 --> 0:09:19.680 removed some of that uncertainty. We look at some of 0:09:19.679 --> 0:09:23.400 the fiscal policy things like infrastructure investment, a potential investment 0:09:23.440 --> 0:09:27.679 package of upwards of one trillion dollars of infrastructure benefits 0:09:27.679 --> 0:09:31.839 Companies that are in the materials think base metals and steel, 0:09:31.880 --> 0:09:34.000 but you know gold and oil in particulars. Go back 0:09:34.000 --> 0:09:35.640 to your question. I look at gold, it's more of 0:09:35.720 --> 0:09:37.720 a it's a currency plan, and you look at the 0:09:37.760 --> 0:09:39.319 basement of the US dollar, and you look at the 0:09:39.360 --> 0:09:42.320 volatility and uncertainty in the market. Goals a great investment. 0:09:42.440 --> 0:09:45.000 The other question you had about oil, it's the largest, 0:09:45.000 --> 0:09:47.480 most liquid commodity in the world, and you look at 0:09:47.520 --> 0:09:50.280 the least amount of spare capacity the OPEQUE meeting and 0:09:50.520 --> 0:09:53.520 the positioning going into the OPEC meeting, Oil is trending 0:09:53.559 --> 0:09:56.080 towards fifty five a barrow, possibly sixty by the end 0:09:56.120 --> 0:09:58.560 of the year. I'm like, I'm looking at some of 0:09:58.600 --> 0:10:02.120 the giant moves we've seen. I'm looking at copper right 0:10:02.120 --> 0:10:08.000 now up uh rally started before the election, but towards 0:10:08.640 --> 0:10:13.640 mid October it's up that much. Uh SMP industrial stocks 0:10:13.679 --> 0:10:19.480 about nine this month. Has the optimism about this stimulus 0:10:19.520 --> 0:10:24.400 spending gotten a little ahead of itself. I think all 0:10:24.480 --> 0:10:26.760 that very valid points. I think what you're seeing is 0:10:27.160 --> 0:10:31.640 a few things. You're seeing a rotation out of defensive names. 0:10:31.640 --> 0:10:35.480 So thank utilities and reats and and telco type companies. 0:10:35.679 --> 0:10:39.040 You know, those equity income place into more cyclicals and 0:10:39.120 --> 0:10:41.920 so names like you look at Southern Copper and you 0:10:41.920 --> 0:10:43.559 look at some of the other names like US Steel, 0:10:44.080 --> 0:10:48.920 beneficiaries of the industrial and manufacturing renaissance that's going to happen. 0:10:48.960 --> 0:10:51.240 Have they gotten ahead of themselves? I would say they 0:10:51.280 --> 0:10:53.360 have not. Actually, when you look at what's gone on, 0:10:53.400 --> 0:10:55.160 a lot of money has come off the sidelines. You've 0:10:55.160 --> 0:10:59.160 seen short covering and copper, You've seen short covering in steel. 0:10:59.520 --> 0:11:01.520 You look at iron ore and things like that. Some 0:11:01.559 --> 0:11:04.400 of these names are up in the last month. They're 0:11:04.400 --> 0:11:06.160 going to take a breather. You're gonna see some trades 0:11:06.200 --> 0:11:08.200 and people do some short term profit taking. If you 0:11:08.200 --> 0:11:12.840 look at the longer term secular trends, there's a trend 0:11:12.960 --> 0:11:15.480 towards this not only infrastructure stimulus, but you're going to 0:11:15.559 --> 0:11:18.520 see more manufacturing and production. So I think the trend 0:11:18.559 --> 0:11:21.080 line is very bullish, particularly for copper and some of 0:11:21.080 --> 0:11:22.679 the base metals. And when you look at what's going 0:11:22.679 --> 0:11:25.280 on in China, you know there's an industrial base there 0:11:25.280 --> 0:11:29.240 that's starting to recover, albeit slowly. Are there any sectors 0:11:29.280 --> 0:11:33.079 were commodities that have people have missed that they should 0:11:33.080 --> 0:11:37.319 have loaded into recently but but haven't taken off. Well, 0:11:37.440 --> 0:11:39.480 I look at timber. Timpers at a great example. If 0:11:39.520 --> 0:11:41.240 if you look at a company like wire house or 0:11:41.240 --> 0:11:44.240 it's a timber reat, you know you can you can 0:11:44.280 --> 0:11:47.280 get access to timber. And when you look at timber 0:11:47.280 --> 0:11:50.760 as a commodity, you've got deforestation and climate change, and 0:11:50.760 --> 0:11:53.200 you've got things like in British Columbia the Mountain pine 0:11:53.200 --> 0:11:56.280 beetles killed one of every three trees in BC, and 0:11:56.320 --> 0:11:58.880 so you've got decreasing supply of timber as a commodity. 0:11:58.920 --> 0:12:02.319 You've got increasing to man. You've seen most recently existing 0:12:02.360 --> 0:12:06.160 home sales five point six million. That's that's significantly over 0:12:06.200 --> 0:12:08.920 the five point four four expected. And so the autumn 0:12:08.920 --> 0:12:11.280 revival of housing market is there for not only existing 0:12:11.280 --> 0:12:14.120 but you look at single family starts in October sixty 0:12:14.160 --> 0:12:18.520 nine thousand, So you know timber commodity price inflation, decreasing 0:12:18.520 --> 0:12:22.040 timber as a commodity, increasing demand. So that's the definition 0:12:22.040 --> 0:12:24.880 of commodity price inflation. Wirehouse is a great way to 0:12:24.880 --> 0:12:26.920 play it. You get some divided income while you wait 0:12:27.000 --> 0:12:28.840 as well as you get some good upside and leverage 0:12:28.880 --> 0:12:32.720 to the US single and multifamily housing recovery. You know, Mike, 0:12:32.920 --> 0:12:37.480 I'm looking at a story right now about the priorities 0:12:37.520 --> 0:12:41.559 laid forth by President elect Donald Trump, and this Baron's 0:12:41.559 --> 0:12:44.480 reporter is noting that he really did not talk about 0:12:44.520 --> 0:12:49.319 infrastructure spending very much, and that currently in the markets 0:12:49.600 --> 0:12:53.560 there is sort of a reduction and expectations for what 0:12:53.720 --> 0:12:56.440 some of his infrastructure plans may be a let alone 0:12:56.440 --> 0:12:59.440 what he might actually get across. I mean, hasn't one 0:12:59.480 --> 0:13:03.160 of the the main drivers of the UH take up 0:13:03.240 --> 0:13:06.760 in commodities, with the exception of gold, hasn't it been 0:13:07.400 --> 0:13:10.480 really driven by these infrastructure expectations And how much could 0:13:10.480 --> 0:13:13.600 there be a sort of decline in commodities should there 0:13:13.640 --> 0:13:17.400 be some disappointment on this front. Well, again, good question there, 0:13:17.400 --> 0:13:20.920 and I would say it's it's not just the infrastructure 0:13:21.080 --> 0:13:24.600 the potential infrastructure spending, because I think whether if it 0:13:24.720 --> 0:13:28.640 was Trump or or Hillary Clinton, you're looking at infrastructure 0:13:29.080 --> 0:13:31.760 as being one of the last great ways you can 0:13:31.800 --> 0:13:34.960 stimulate the economy because you look at monetary policy and 0:13:35.120 --> 0:13:38.679 artificially low rates that experiment over the last decade, you know, 0:13:38.720 --> 0:13:42.160 we've run the course on on monetary policy, fiscal policies 0:13:42.200 --> 0:13:46.240 and next logical progression. You've seen it in Australia, You've 0:13:46.240 --> 0:13:48.280 seen it in the UK over the last thirty years, 0:13:48.280 --> 0:13:51.600 what they've done with fiscal spending and investing in infrastructure. 0:13:51.600 --> 0:13:54.240 There's a multiplier effect, and so infrastructure plus some of 0:13:54.240 --> 0:13:58.400 these tax cuts financed via deficit. You know, infrastructure investment 0:13:58.440 --> 0:14:05.120 both economic infrastructure, energy, utilities, transportation, as well as social infrastructure, 0:14:05.200 --> 0:14:08.240 so think about schools and hospitals. There's a multiplier effect 0:14:08.240 --> 0:14:10.720 that creates jobs as well as it it increases the 0:14:10.800 --> 0:14:15.319 overall GDP and economic output. Has the base metal commodity 0:14:15.360 --> 0:14:19.200 trade has it has its out outlasted the short term trade? 0:14:19.360 --> 0:14:21.960 I don't think so. I think what you're seeing is 0:14:22.400 --> 0:14:25.800 there's short term speculation as well as short covering by 0:14:25.800 --> 0:14:28.600 some hedge funds in the material space. And admittedly, if 0:14:28.640 --> 0:14:31.200 you were to look at natural resources and medals in 0:14:31.240 --> 0:14:34.640 two thousand fifteen, a year ago, some of those asset classes, 0:14:34.680 --> 0:14:38.640 some of those companies were down, so the asset class 0:14:38.680 --> 0:14:40.640 was washed out. You've seen a reversion of the mean, 0:14:40.720 --> 0:14:43.760 and that's started in February, really February eleventh, two thousand 0:14:43.800 --> 0:14:47.240 and sixteen, when you saw oil and equity sort of 0:14:47.280 --> 0:14:49.920 hit their technical market bottom. We saw the dead cat bounce, 0:14:50.400 --> 0:14:53.200 and then you've seen this. This fits and starts of volatility. 0:14:53.240 --> 0:14:56.120 So it really started. Natural resources and material started ramping 0:14:56.160 --> 0:14:59.200 up an energy in February sixteen, so this started quite 0:14:59.240 --> 0:15:01.560 some time ago. But I think again, you're gonna see 0:15:01.600 --> 0:15:04.600 volatility as well as significant upside, So it's not going 0:15:04.680 --> 0:15:07.520 to be a smooth ride, right. Mike Underhill, portfolio manager 0:15:07.560 --> 0:15:11.760 of the Ridgeworth Capital Innovations, Global Resources and Infrastructure Fund, 0:15:11.920 --> 0:15:14.880 on the outlook going forward for commodities of all type, 0:15:15.360 --> 0:15:18.000 of all types. And Lisa brown Woods. Uh, Mike Reagan 0:15:18.240 --> 0:15:20.800 here with me today Bloomberg calumnist filling in for Pim Fox, 0:15:20.800 --> 0:15:36.680 who's on vacation. This is Bloomberg. I'm seeing people smile now, 0:15:36.880 --> 0:15:40.760 clients of mine where I didn't even know they had teeth. 0:15:41.000 --> 0:15:45.720 That is a quote in a story, truly phenomenal story 0:15:45.880 --> 0:15:49.520 on the Bloomberg by Max Abelson and Tacan Campbell. Uh. 0:15:49.520 --> 0:15:51.760 And Lisa brown Woods here with Mike Reagan filling in 0:15:51.840 --> 0:15:56.240 for Pim Fox. Max Abelson, really great read. What are 0:15:56.280 --> 0:15:59.040 you hearing from these Wall Street types at this point. Lisia, 0:15:59.160 --> 0:16:01.760 First of all, thank we're saying that about the story. Second, well, 0:16:01.760 --> 0:16:03.680 I have to give full credit to Dacon Campbell and 0:16:03.720 --> 0:16:07.120 my colleague forgetting that awesome quote. I always I was 0:16:07.120 --> 0:16:08.880 proud of my ability to get good quotes, but that 0:16:08.880 --> 0:16:11.160 one is like, that was pure Deacon. When he showed 0:16:11.200 --> 0:16:14.160 that to me, I was so excited because what we 0:16:14.160 --> 0:16:17.920 were interested in finding out was how these guys are 0:16:18.000 --> 0:16:21.640 viewing Trump after he spent like months just openly mocking them. 0:16:22.120 --> 0:16:26.440 Trump Trump called bankers, um at Wall Street people, hedge 0:16:26.440 --> 0:16:29.080 for managers, you know, basically the members of like a 0:16:29.080 --> 0:16:34.040 criminalistic cabal. And you know, it took them. They told 0:16:34.080 --> 0:16:36.680 us like basically twenty minutes, you know, the twenty minutes 0:16:36.680 --> 0:16:40.040 after the election, they were sad that Hillary Clinton didn't win, 0:16:40.320 --> 0:16:42.440 you know, the Clinton supporters that is. And then they 0:16:42.480 --> 0:16:45.400 moved on because at least they think, you know, they're 0:16:45.400 --> 0:16:47.280 they're made in the shade that their industries is gonna 0:16:47.280 --> 0:16:50.920 be deregulated, their taxes are gonna go down, and uh 0:16:51.080 --> 0:16:53.200 it's gonna Trump is gonna help usher in this like 0:16:53.560 --> 0:16:56.360 free willing new era. So Max, what are they basically 0:16:56.400 --> 0:17:00.760 anticipating just the complete destruction of Dodd Frank. I mean, 0:17:00.840 --> 0:17:04.160 is that is that a realistical I think that anyone 0:17:04.760 --> 0:17:06.920 on Wall Street or or or anywhere else who thinks 0:17:06.960 --> 0:17:09.200 they know what's gonna happen like under President Trump, is 0:17:09.760 --> 0:17:12.040 you know, really is going to have to be surprised. 0:17:12.040 --> 0:17:17.200 Because I feel like we was very diplomatic. I was about, yeah, 0:17:17.240 --> 0:17:20.200 you know, look, people have had the wrong idea about 0:17:20.240 --> 0:17:22.359 this guy for a really long time, going back to 0:17:22.400 --> 0:17:25.640 when he basically was nearly ruined in the early nineties 0:17:25.680 --> 0:17:27.359 and managed to bounce back is a sort of like 0:17:27.560 --> 0:17:30.480 new reality figure, and then of course during the primaries, 0:17:30.520 --> 0:17:32.639 of course during the presidential run. But I think that 0:17:32.720 --> 0:17:36.400 to answer your question, there's an expectation because he's said 0:17:36.480 --> 0:17:39.680 so that a lot of Dodd Frank is going to disappear, 0:17:39.760 --> 0:17:42.000 is going to be rolled back. Now. The thing that 0:17:42.040 --> 0:17:43.920 we also have to talk about that's kind of complicates 0:17:43.920 --> 0:17:47.280 all this is that he's also said totally contradictory things. 0:17:47.520 --> 0:17:51.200 He suggested that, for example, like glass Stagel will come back, 0:17:51.320 --> 0:17:54.320 or at least that is literally in the Republican platform 0:17:54.440 --> 0:17:58.840 for for this year. So what's giving bankers confidence that 0:17:59.040 --> 0:18:02.440 Donald Trump had been station will be positive for Wall Street. Well, 0:18:02.480 --> 0:18:05.000 came up during my interviews UM and and interviews that 0:18:05.040 --> 0:18:09.640 Dacan Campbell, My colleague ran, is this you had as 0:18:09.680 --> 0:18:13.720 the closing ad for Trump's campaign that remember that image 0:18:13.720 --> 0:18:16.800 of Lloyd Blank fine uh and Donald Trump's voiceover was like, 0:18:16.840 --> 0:18:19.240 you know, a a criminal group is trying to steal 0:18:19.280 --> 0:18:23.800 your money. Um. By the Friday after the election, the 0:18:23.840 --> 0:18:25.960 team that was in charge of Trump's transition, that is 0:18:26.000 --> 0:18:30.280 in charge of Trump transition included Golden sax Alum, Steve Bannon, 0:18:30.520 --> 0:18:35.480 Goldman sax Alum, Steve Manuchin, Goldman sax along Lam, Anthony Scaramucci. 0:18:35.600 --> 0:18:37.680 So he is surrounding himself with these people and I 0:18:37.720 --> 0:18:40.560 think that's incredibly comforting. And then you know, even beyond 0:18:40.600 --> 0:18:43.159 who's going to be Treasury Secretary, Zach Mider and I 0:18:43.160 --> 0:18:44.919 wrote that long profile about Steve Manuch and it's kind 0:18:44.960 --> 0:18:46.159 of it's kind of feeling like it's going to be 0:18:46.240 --> 0:18:50.440 him Treasury secretary. Side my colleagues UM, Jesse Hamilton and 0:18:50.520 --> 0:18:53.120 Robert Schmidt had a great story today that folks should 0:18:53.160 --> 0:18:56.760 read as well. That's basically about Wall Street licking their 0:18:56.760 --> 0:19:01.600 lips to UM expecting that Tarulah. Of course that at 0:19:01.640 --> 0:19:04.760 the FED is going to sort of be out of 0:19:04.800 --> 0:19:07.440 the unofficial role that he's kind of been in over 0:19:07.600 --> 0:19:08.960 the last couple of years, and that they'll have a 0:19:08.960 --> 0:19:12.280 Federal Reserve Vice chairman overseeing Wall Street who's like incredibly 0:19:12.280 --> 0:19:14.680 sympathetic to bankers. That that's that's what Schmith's story is. 0:19:14.880 --> 0:19:16.520 You know, how much of a surprise really is this? 0:19:16.680 --> 0:19:20.400 I mean, isn't this always what people suspect that presidential 0:19:20.640 --> 0:19:23.760 candidates will sort of talk a hard line on Wall Street, 0:19:23.760 --> 0:19:25.560 then they'll get into office and they'll forget everything. And 0:19:25.720 --> 0:19:29.639 isn't that the sort of classic cliche, you know the differences. 0:19:29.720 --> 0:19:33.360 I think that Reagan and Bush one and Bush two 0:19:34.440 --> 0:19:38.840 came in with, um, you know, nothing but but mostly 0:19:38.920 --> 0:19:42.560 nice things to say about the financial services industry. Um, 0:19:42.760 --> 0:19:44.719 this is the old guy over here. We would remember 0:19:44.760 --> 0:19:49.080 if George W. Bush was insulting Wall Street, had to 0:19:49.119 --> 0:19:57.040 go there with the old guy. Listen. I'm I think 0:19:57.080 --> 0:20:02.000 it's fair to say that even um, you know, even Obama, 0:20:02.240 --> 0:20:04.520 even Obama when he took over at the height of 0:20:04.600 --> 0:20:08.680 financial crisis, didn't have nearly the same kind of populous 0:20:08.720 --> 0:20:11.919 tone that that that Donald Trump had. So on the 0:20:11.960 --> 0:20:17.359 one hand, you always expect Republicans and frankly even Democrats 0:20:17.400 --> 0:20:19.679 to be much softer on Wall Street because of the 0:20:19.800 --> 0:20:22.040 financial power of Wall Street. But and and and then 0:20:22.040 --> 0:20:24.119 of course people are disappointed. But but then on the 0:20:24.160 --> 0:20:28.040 other um, you know, Donald Trump is is just so inconsistent. 0:20:28.080 --> 0:20:29.720 It's just so hard to hard to know what's gonna come. Max. 0:20:29.800 --> 0:20:31.800 Let me ask you, from all the reporting you've done 0:20:31.840 --> 0:20:34.520 on Wall Street and Trump, and it's been excellent reporting 0:20:34.560 --> 0:20:37.200 for for sort of a junior rookie reporter like yourself, 0:20:37.440 --> 0:20:40.480 young a young man like yourself. Have you talked to 0:20:40.520 --> 0:20:43.440 many bankers who have actually done business with Trump? And 0:20:43.840 --> 0:20:46.080 is there a difference in perspective from those that have 0:20:46.160 --> 0:20:48.719 actually done deals with them and those that are just 0:20:48.880 --> 0:20:51.280 you know, watching along like the rest of us. You know, 0:20:51.520 --> 0:20:55.159 I think that um one real pity is that the 0:20:55.359 --> 0:20:58.359 City Group banker who was really in charge in the 0:20:58.400 --> 0:21:00.960 early nineties passed away. I think she was actually hit 0:21:01.480 --> 0:21:05.240 riding a bicycle just just before Trump's run really took off. 0:21:05.720 --> 0:21:08.439 So well, we don't know, um. I would love to 0:21:08.440 --> 0:21:11.080 know what she has to say about I think it 0:21:11.119 --> 0:21:14.080 was sort of partially her decision to keep Trump alive, 0:21:14.119 --> 0:21:16.680 to keep Trump above water um that they really could 0:21:16.720 --> 0:21:18.800 have brought him down, that he had skinning him, so 0:21:18.800 --> 0:21:20.680 he basically could have had to go personally break right 0:21:21.240 --> 0:21:22.960 rather rather than the company's going back roup. But but 0:21:23.000 --> 0:21:25.520 I have whenever you speak to people who have done 0:21:25.560 --> 0:21:28.760 business with them, they speak with it with incredible anchor 0:21:28.800 --> 0:21:31.840 and sadness about about the betrayals that that they've had 0:21:31.880 --> 0:21:33.600 to go through. There are people who love him, but 0:21:33.640 --> 0:21:35.120 there are a lot of people who feel betrayed after 0:21:35.119 --> 0:21:50.600 spending time working with Donald Trump. Donald Trum. We got 0:21:50.680 --> 0:21:54.120 some home sales data this morning at ten am. Existing 0:21:54.200 --> 0:21:58.719 home sales came in higher than expected, just sort of 0:21:58.720 --> 0:22:03.159 showing that there might just be momentum behind the housing market. 0:22:03.240 --> 0:22:06.320 But is that momentum about to stall out? I want 0:22:06.359 --> 0:22:10.080 to bring in Logan Mota Shoppi, a senior loan officer 0:22:10.119 --> 0:22:12.919 at AMC Lending Group, to give us a little bit 0:22:12.920 --> 0:22:17.920 of color. I'm forward leading indicators. Logan. When we look 0:22:17.920 --> 0:22:22.400 at existing home sales, that's a backward looking indicator. Correct, yes, 0:22:22.520 --> 0:22:25.879 it's a backward indicating look indicator. But what what I 0:22:25.880 --> 0:22:29.399 would uh emphasize today on the existing home sales report 0:22:29.720 --> 0:22:33.240 is that existing home sales are at psycho highs, as 0:22:33.359 --> 0:22:37.880 mortgage demand is at psycho highs, and the housing community, economists, 0:22:37.960 --> 0:22:41.920 analysts and everybody has been telling people that low inventory 0:22:42.160 --> 0:22:46.720 is holding housing back. It's exactly the opposite. All the 0:22:46.800 --> 0:22:50.600