1 00:00:05,120 --> 00:00:09,200 Speaker 1: Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keane, along 2 00:00:09,240 --> 00:00:13,200 Speaker 1: with Jonathan Ferrell and Lisa Brownwitz Jaily. We bring you 3 00:00:13,280 --> 00:00:18,600 Speaker 1: insight from the best and economics, finance, investment, and international relations. 4 00:00:18,960 --> 00:00:23,840 Speaker 1: Find Bloomberg Surveillance on Apple podcast, Suncloud, Bloomberg dot com, 5 00:00:23,920 --> 00:00:30,800 Speaker 1: and of course on the Bloomberg terminal. Right now, Rebecca 6 00:00:30,840 --> 00:00:33,040 Speaker 1: Pattison joins us. We are thrilled to ever whether she's 7 00:00:33,040 --> 00:00:36,640 Speaker 1: with Bridgewater, director of Investment Research, but far more is 8 00:00:36,680 --> 00:00:39,800 Speaker 1: her time on the street bringing a holistic ly together 9 00:00:39,920 --> 00:00:43,559 Speaker 1: the foreign exchange market with everything else out there. Rebecca, 10 00:00:43,600 --> 00:00:46,800 Speaker 1: wonderful to have you with us today. I'm Bitcoin. What 11 00:00:46,880 --> 00:00:49,640 Speaker 1: did we learn this week? I put up there some 12 00:00:49,680 --> 00:00:52,520 Speaker 1: of the dynamics, the silliness of it being a gold 13 00:00:52,560 --> 00:00:57,160 Speaker 1: equivalent or a coin equivalent. What did we learn? I 14 00:00:57,280 --> 00:01:01,800 Speaker 1: think we got reaffirmation that it's a speculative asset and 15 00:01:01,840 --> 00:01:03,960 Speaker 1: it still has a long ways to go to become 16 00:01:04,000 --> 00:01:06,839 Speaker 1: a gold equivalent, to become a proper storehold of wealth, 17 00:01:07,319 --> 00:01:10,080 Speaker 1: something that you can count on to have purchasing power 18 00:01:10,120 --> 00:01:13,959 Speaker 1: over time, that's going to have stable and relatively low volatility. 19 00:01:14,080 --> 00:01:16,760 Speaker 1: This was not a low volatility week or so for 20 00:01:16,880 --> 00:01:20,040 Speaker 1: bitcoin quite the contrary, Rebecca, do you see a generation 21 00:01:20,120 --> 00:01:22,959 Speaker 1: with divide between certain age groups who believe this is 22 00:01:23,000 --> 00:01:28,840 Speaker 1: the new golden other age groups that just do not. Anecdotally, Yes, anecdotally, 23 00:01:28,880 --> 00:01:32,039 Speaker 1: it does seem that people who are looking for alternative 24 00:01:32,800 --> 00:01:35,600 Speaker 1: uh sources of cash if you will, Um, you do 25 00:01:35,760 --> 00:01:38,319 Speaker 1: have a bit of a younger generation bias towards the 26 00:01:38,319 --> 00:01:43,520 Speaker 1: cryptocurrencies versus gold. But um, you know, to me, it's 27 00:01:43,600 --> 00:01:46,399 Speaker 1: it's not the generation as much as the retail versus 28 00:01:46,400 --> 00:01:50,080 Speaker 1: the institutional. The money that's going into bitcoin and other 29 00:01:50,120 --> 00:01:54,000 Speaker 1: cryptocurrencies today is still largely retail. Of course, you're getting 30 00:01:54,040 --> 00:01:56,840 Speaker 1: a few more corporations, you're getting family offices, you're getting 31 00:01:56,880 --> 00:02:00,600 Speaker 1: some hedge funds, But the large institutional money that's thinking 32 00:02:00,680 --> 00:02:03,200 Speaker 1: about do I want this as part of the diversifying 33 00:02:03,280 --> 00:02:06,280 Speaker 1: assets in my portfolio to protect me from draw downs 34 00:02:06,320 --> 00:02:10,640 Speaker 1: from from bad periods of market stress. We're not there yet. 35 00:02:10,720 --> 00:02:13,200 Speaker 1: It might get there over time, but it's not there yet. 36 00:02:13,240 --> 00:02:15,880 Speaker 1: So this is still an asset that I think is 37 00:02:15,960 --> 00:02:19,440 Speaker 1: primarily one to be used for return and speculation, not 38 00:02:19,600 --> 00:02:22,000 Speaker 1: the time. Over time though, Rebecca, do you think that 39 00:02:22,080 --> 00:02:24,760 Speaker 1: invests the conditioning kicks in many people will ask us 40 00:02:24,760 --> 00:02:28,119 Speaker 1: when they're not familiar with financial markets and macro, why 41 00:02:28,120 --> 00:02:30,160 Speaker 1: does the end do so well when things get bad? 42 00:02:30,160 --> 00:02:32,079 Speaker 1: And there are various ways of explaining that, but one 43 00:02:32,080 --> 00:02:34,600 Speaker 1: of them is it just does well. It's worked, and 44 00:02:34,639 --> 00:02:37,240 Speaker 1: it's worked historically. Do we need to be conditioned by 45 00:02:37,280 --> 00:02:40,680 Speaker 1: this somehow to start believing it a little bit more well? 46 00:02:40,720 --> 00:02:44,680 Speaker 1: I think over time you could see that environment come together, 47 00:02:44,800 --> 00:02:46,640 Speaker 1: and there's a couple of things I'd be watching. The 48 00:02:46,720 --> 00:02:50,080 Speaker 1: big one right now is the regulatory ecosystem. You know, 49 00:02:50,200 --> 00:02:55,679 Speaker 1: it's very immature still for cryptocurrencies, and after the Colonial 50 00:02:55,720 --> 00:02:58,800 Speaker 1: pipeline hack paid for with crypto, the ransom was paid 51 00:02:58,800 --> 00:03:01,440 Speaker 1: for crypto, I think you are going to see regulators 52 00:03:01,440 --> 00:03:04,000 Speaker 1: in the US focusing more on this, trying to make 53 00:03:04,000 --> 00:03:07,960 Speaker 1: sure there isn't illicit activity, trying to increase transparency. That 54 00:03:08,040 --> 00:03:10,440 Speaker 1: might make some holders a bitcoin not want to own 55 00:03:10,480 --> 00:03:13,320 Speaker 1: it anymore. They're there for the anonymity, but it could 56 00:03:13,400 --> 00:03:17,120 Speaker 1: create an ecosystem that gives more um credibility to it, 57 00:03:17,360 --> 00:03:20,280 Speaker 1: more encouragement for large institutional players to come in. If 58 00:03:20,320 --> 00:03:23,000 Speaker 1: they come in and you have another source of liquidity there, 59 00:03:23,320 --> 00:03:26,880 Speaker 1: that could bring down volatility over time. That's the positive 60 00:03:26,919 --> 00:03:30,760 Speaker 1: flywheel that I think could change how bitcoin and perhaps 61 00:03:30,840 --> 00:03:34,679 Speaker 1: other cryptocurrencies are perceived. Obviously, there's the environmental issues to 62 00:03:34,800 --> 00:03:37,640 Speaker 1: which are are clearly a problem for some investors. I 63 00:03:37,680 --> 00:03:40,080 Speaker 1: think those things need to get addressed and the volatility 64 00:03:40,080 --> 00:03:42,760 Speaker 1: needs to come down. But if those things can happen, 65 00:03:43,000 --> 00:03:46,000 Speaker 1: I think this could evolve into some some type of 66 00:03:46,040 --> 00:03:48,360 Speaker 1: digital gold. If you will, Rebecca, I want you to 67 00:03:48,400 --> 00:03:51,600 Speaker 1: elaborate on the environmental concerns, because Elon Musk of Tesla 68 00:03:51,720 --> 00:03:54,040 Speaker 1: highlighted this, and you highlighted this in a recent research 69 00:03:54,080 --> 00:03:58,720 Speaker 1: report showing that bitcoin uses up more energy than say, 70 00:03:58,880 --> 00:04:01,280 Speaker 1: even uh switch relent. When you take a look at 71 00:04:01,320 --> 00:04:04,720 Speaker 1: the energy consumption, it's basically a nation onto itself when 72 00:04:04,760 --> 00:04:07,480 Speaker 1: it comes to this area. Can this be solved? How 73 00:04:07,480 --> 00:04:10,680 Speaker 1: big of a concern is this for certain investors? Well, 74 00:04:10,720 --> 00:04:14,960 Speaker 1: increasingly investors are focusing on on environmental and other e 75 00:04:15,160 --> 00:04:18,520 Speaker 1: s G. Issues, so so it is an increasing concern 76 00:04:18,560 --> 00:04:21,240 Speaker 1: for a lot of large institutions. There are ways it 77 00:04:21,279 --> 00:04:24,120 Speaker 1: can be addressed. You can see changes in the technology 78 00:04:24,240 --> 00:04:27,520 Speaker 1: used in bitcoin, for example, that could reduce energy usage. 79 00:04:28,080 --> 00:04:30,880 Speaker 1: You could see the type of energy used, more of 80 00:04:30,880 --> 00:04:33,560 Speaker 1: a focus on renewable energy that could also be a 81 00:04:33,600 --> 00:04:36,919 Speaker 1: positive trend. There's also another option here, which is that 82 00:04:37,120 --> 00:04:40,640 Speaker 1: another cryptocurrency that has lower energy usage but also some 83 00:04:40,720 --> 00:04:44,400 Speaker 1: of the positive characteristics like limited supply, you could see 84 00:04:44,400 --> 00:04:48,400 Speaker 1: that supplant bitcoin. Just because Bitcoin is the dominant currency 85 00:04:48,480 --> 00:04:51,600 Speaker 1: today doesn't mean it will always be. So I think 86 00:04:51,600 --> 00:04:53,680 Speaker 1: there are some different paths, but over time it's going 87 00:04:53,720 --> 00:04:56,479 Speaker 1: to get addressed one way or another. Meanwhile, Rebecca, I 88 00:04:56,480 --> 00:04:58,479 Speaker 1: want to pick up on something that John was talking about, 89 00:04:58,520 --> 00:05:00,680 Speaker 1: because I know that this dovetails into the inflation call. 90 00:05:00,760 --> 00:05:03,279 Speaker 1: The Bridgewater has had this whole cash is trash and 91 00:05:03,640 --> 00:05:06,159 Speaker 1: that Ray Dally is talking about, but moving forward that 92 00:05:06,240 --> 00:05:08,240 Speaker 1: inflation is going to be more of a threat. What 93 00:05:08,320 --> 00:05:11,200 Speaker 1: do you make of the move recently lower in a 94 00:05:11,320 --> 00:05:15,000 Speaker 1: longer term break even rates? Basically longer term inflation expectations 95 00:05:15,080 --> 00:05:19,039 Speaker 1: have come down even as we get this robust data. Yeah, 96 00:05:19,120 --> 00:05:22,640 Speaker 1: I mean, Ore, this is such an unusual time, right. 97 00:05:22,680 --> 00:05:26,280 Speaker 1: We're seeing the biggest US boom um that we've had 98 00:05:26,279 --> 00:05:30,719 Speaker 1: in decades, and we have so many different cross currents. 99 00:05:30,760 --> 00:05:34,520 Speaker 1: Given the reopenings coming out of the pandemic, demand rising 100 00:05:34,600 --> 00:05:37,280 Speaker 1: faster than some supply commedian. You just mentioned that a 101 00:05:37,320 --> 00:05:39,599 Speaker 1: few minutes ago in the European p m I data 102 00:05:40,240 --> 00:05:42,359 Speaker 1: that that it's hard to have a high degree of 103 00:05:42,360 --> 00:05:44,479 Speaker 1: confidence how this is going to play out. But as 104 00:05:44,560 --> 00:05:47,440 Speaker 1: we look at the year or so ahead, we see 105 00:05:47,839 --> 00:05:51,520 Speaker 1: a decent amount of risk that inflation could keep rising. 106 00:05:51,560 --> 00:05:54,880 Speaker 1: It's already rising, but stay higher for longer. And part 107 00:05:54,920 --> 00:05:57,200 Speaker 1: of that is the supply taking a while to catch 108 00:05:57,320 --> 00:05:59,920 Speaker 1: up with the increasing demand. And part of it is 109 00:06:00,080 --> 00:06:05,520 Speaker 1: more structural forces globalization, which has helped reduced inflation for years, 110 00:06:05,720 --> 00:06:09,000 Speaker 1: that's been plateauing and could possibly reverse a little bit. 111 00:06:09,880 --> 00:06:13,520 Speaker 1: The trend towards capital over labor that's starting to reverse 112 00:06:13,560 --> 00:06:17,480 Speaker 1: a little bit as you see higher wages, higher minimum wages, etcetera. Um. 113 00:06:17,560 --> 00:06:20,640 Speaker 1: And so if you see some of these secular forces 114 00:06:20,680 --> 00:06:24,680 Speaker 1: slowing or reversing somewhat and these cyclical forces, we think 115 00:06:24,720 --> 00:06:27,120 Speaker 1: you could be in a slightly higher inflation environment. So 116 00:06:27,200 --> 00:06:29,960 Speaker 1: the day to day moves aside. I think you want 117 00:06:30,000 --> 00:06:33,159 Speaker 1: to be looking as an investor, does my portfolio have 118 00:06:33,360 --> 00:06:36,640 Speaker 1: enough protection if that risk becomes reality? And this isn't 119 00:06:36,640 --> 00:06:40,160 Speaker 1: just as the FED likes to say, transitory inflation. Rebecca, 120 00:06:40,200 --> 00:06:41,919 Speaker 1: I want to get in trouble with Ray Dalio. So 121 00:06:41,920 --> 00:06:43,880 Speaker 1: I'm gonna ask a rude question, and you're such a 122 00:06:43,880 --> 00:06:46,680 Speaker 1: pro you'll give me an honest answer right now. Stock 123 00:06:46,720 --> 00:06:49,680 Speaker 1: bond correlations are really quite odd. That goes into rate 124 00:06:49,720 --> 00:06:54,640 Speaker 1: parity strategies and such. What is a duration the timeline 125 00:06:55,400 --> 00:06:59,920 Speaker 1: of this odd correlation where it begins to affect portfolios. 126 00:07:00,200 --> 00:07:03,200 Speaker 1: We're hearing short term no big deal. When does no 127 00:07:03,320 --> 00:07:06,839 Speaker 1: big deal become a big deal? So, Tom, I think 128 00:07:06,880 --> 00:07:08,600 Speaker 1: I don't think that's a rude question at all. I 129 00:07:08,600 --> 00:07:11,480 Speaker 1: think you're you're highlighting a couple of things that that 130 00:07:11,520 --> 00:07:14,680 Speaker 1: are worth unpacking a little bit. Um First, when we 131 00:07:14,720 --> 00:07:17,840 Speaker 1: think about risk parity strategies all weather, which is our 132 00:07:17,880 --> 00:07:22,480 Speaker 1: our strategy, it's it's a strategic long term assid allocation. 133 00:07:22,720 --> 00:07:24,720 Speaker 1: What we're trying to do is get rid of some 134 00:07:24,760 --> 00:07:29,000 Speaker 1: of the volatility that can come with changes in economic environments, growth, inflation, 135 00:07:29,560 --> 00:07:32,200 Speaker 1: and what that allows us to do is get more 136 00:07:32,240 --> 00:07:35,560 Speaker 1: steady returns over time and then we can compound that, 137 00:07:35,640 --> 00:07:37,960 Speaker 1: which is, as Einstein said, isn't at the eighth wonder 138 00:07:37,960 --> 00:07:41,240 Speaker 1: of the world. Um. So that's a very different strategy 139 00:07:41,480 --> 00:07:45,200 Speaker 1: than save pure alpha, where we're really focusing on uncorrelated 140 00:07:45,320 --> 00:07:47,880 Speaker 1: return streams that are over shorter time periods. It's more 141 00:07:47,880 --> 00:07:53,160 Speaker 1: tactical UM For for folks who are thinking about risk 142 00:07:53,200 --> 00:07:56,720 Speaker 1: parity strategy, remember it's never been determined on one asset 143 00:07:56,960 --> 00:07:59,640 Speaker 1: or one country. It's going to be a balanced mix 144 00:07:59,680 --> 00:08:03,240 Speaker 1: about sets. So even if bond yields rise um, there 145 00:08:03,280 --> 00:08:05,920 Speaker 1: are going to be other bonds that are still attractive China, 146 00:08:06,000 --> 00:08:08,760 Speaker 1: for example, the tenure yield. There is still three much 147 00:08:08,800 --> 00:08:12,200 Speaker 1: more normal policy mix going on. And then you're gonna 148 00:08:12,240 --> 00:08:13,920 Speaker 1: have other assets that are going to give you that 149 00:08:13,960 --> 00:08:17,000 Speaker 1: diversification and that balance no matter what the environment is. 150 00:08:17,040 --> 00:08:18,760 Speaker 1: But the other thing Tom, that I think is really 151 00:08:18,800 --> 00:08:22,000 Speaker 1: important that you just said is about correlation. And I 152 00:08:22,040 --> 00:08:25,200 Speaker 1: think you know every sixty forty portfolios or the last 153 00:08:25,200 --> 00:08:27,280 Speaker 1: couple of decades have just been able to sit back 154 00:08:27,320 --> 00:08:29,720 Speaker 1: and let it roll in. You've had rising stocks and 155 00:08:29,880 --> 00:08:33,240 Speaker 1: falling bond yields. And today there is a chance that 156 00:08:33,320 --> 00:08:35,960 Speaker 1: you're going to see that relationship break apart, and you 157 00:08:36,000 --> 00:08:38,360 Speaker 1: need to understand why that's happening and then what you 158 00:08:38,400 --> 00:08:41,120 Speaker 1: do about it. If we think that relationship is breaking 159 00:08:41,160 --> 00:08:44,320 Speaker 1: apart in part because of inflation, then you want to 160 00:08:44,320 --> 00:08:46,720 Speaker 1: make sure that you don't have too many bonds. You 161 00:08:46,720 --> 00:08:49,080 Speaker 1: want to make sure that you also have other assets 162 00:08:49,080 --> 00:08:51,720 Speaker 1: to protect you against that risk, whether it's gold which 163 00:08:51,720 --> 00:08:57,080 Speaker 1: has been recovering nicely recently, inflation linked bonds, even equities 164 00:08:57,120 --> 00:08:59,240 Speaker 1: that give you more of a steady cash flow over 165 00:08:59,320 --> 00:09:03,040 Speaker 1: time that aren't going to be as vulnerable to that 166 00:09:03,160 --> 00:09:06,840 Speaker 1: duration issue. Rebecca, always smile and always enjoy a contribution. 167 00:09:06,920 --> 00:09:10,360 Speaker 1: Rebecca Pattison NAP which want a director of investment research 168 00:09:17,080 --> 00:09:18,559 Speaker 1: one of our high points of the day to get 169 00:09:18,559 --> 00:09:22,200 Speaker 1: you recalibrated on global Wall Street and particularly American Wall Street. 170 00:09:22,440 --> 00:09:25,040 Speaker 1: He is after saying two hundred thousand jobs will be 171 00:09:25,120 --> 00:09:28,960 Speaker 1: jettison truly and exile on Wall Street. Michael Mayo joins 172 00:09:29,040 --> 00:09:31,800 Speaker 1: US with Wells Fargo from his decades of work, including 173 00:09:31,840 --> 00:09:34,440 Speaker 1: a dark day with Credit Sweets years ago to now 174 00:09:34,480 --> 00:09:37,640 Speaker 1: holding court at Wells Fargo ahead of the US large 175 00:09:37,720 --> 00:09:40,720 Speaker 1: cap bank research Mike Mayo with US, Mike, I've got 176 00:09:40,800 --> 00:09:43,760 Speaker 1: to rip up the script. This is all anybody's talking about, 177 00:09:44,040 --> 00:09:46,959 Speaker 1: and you are the one to give perspective. Can a 178 00:09:47,120 --> 00:09:51,880 Speaker 1: duo run consumer banking? They're gonna try that at JP Morgan. 179 00:09:52,440 --> 00:09:58,079 Speaker 1: Is it feasible? I'm never a fan of dual heads. 180 00:09:58,400 --> 00:10:03,600 Speaker 1: Having said that AP Morgan cultivates a culture of collaboration, 181 00:10:03,800 --> 00:10:08,120 Speaker 1: so whoever collaborates better is ironically the one who could 182 00:10:08,240 --> 00:10:12,600 Speaker 1: ultimately win. We have two women who are in contention 183 00:10:12,840 --> 00:10:16,120 Speaker 1: to take Jamie Diamond's job, having said that, you know, 184 00:10:16,160 --> 00:10:23,240 Speaker 1: when Jamie Diamond retires N plus five at five years to, 185 00:10:23,280 --> 00:10:25,319 Speaker 1: whenever you ask him the question. So I don't think 186 00:10:25,320 --> 00:10:28,360 Speaker 1: it's happening anytime soon. I think that the board wants 187 00:10:28,400 --> 00:10:30,800 Speaker 1: him to stay. Investors wanted to stay. But you do 188 00:10:30,840 --> 00:10:33,240 Speaker 1: have two women who are in contention. If the two 189 00:10:33,240 --> 00:10:36,160 Speaker 1: women are in contention, two men in contention, you know, 190 00:10:36,240 --> 00:10:39,720 Speaker 1: let's be honest. This is absolutely original stuff to your 191 00:10:39,760 --> 00:10:43,000 Speaker 1: research note which stopped Wall Street a few days ago, 192 00:10:43,520 --> 00:10:48,200 Speaker 1: how old the dominant JP Morgan consumer franchise and adapt 193 00:10:48,240 --> 00:10:52,199 Speaker 1: an adjust to automation, to digital banking and the rest 194 00:10:52,240 --> 00:10:56,960 Speaker 1: that you highlight, Well, JP Morgan is a microcosm of 195 00:10:57,000 --> 00:11:00,439 Speaker 1: the broader industry. And for you Tom and going to 196 00:11:00,520 --> 00:11:04,600 Speaker 1: the classics, I'm going to the Greek philosopher Plato who 197 00:11:04,720 --> 00:11:09,400 Speaker 1: said necessity is the mother of invention. Banks have no 198 00:11:09,600 --> 00:11:13,640 Speaker 1: choice but to get more efficient, to use automation and 199 00:11:13,760 --> 00:11:17,199 Speaker 1: the streamline. So whether it's JP Morgan or any other bank, 200 00:11:17,320 --> 00:11:20,760 Speaker 1: even though they're opening up branches and hiring advisors and 201 00:11:20,800 --> 00:11:23,920 Speaker 1: all sorts of people. Over the next ten years, we 202 00:11:24,040 --> 00:11:27,760 Speaker 1: expect headcount to decline by two hundred thousand jobs, up 203 00:11:27,800 --> 00:11:30,400 Speaker 1: to two hundred thousand jobs for the banking industry. And 204 00:11:30,400 --> 00:11:34,200 Speaker 1: that's because you have automation in the back office, digitization 205 00:11:34,280 --> 00:11:38,280 Speaker 1: the front office, and because banks have no choice as 206 00:11:38,320 --> 00:11:42,079 Speaker 1: they compete against big tech, big retail at a bunch 207 00:11:42,080 --> 00:11:44,839 Speaker 1: of non banks that have a lot less regulation. How 208 00:11:44,920 --> 00:11:49,360 Speaker 1: is that going to go down politically, Mike, Uh, not 209 00:11:49,440 --> 00:11:51,800 Speaker 1: always well, but it could be better than in the 210 00:11:51,840 --> 00:11:57,200 Speaker 1: past because with natural attrition, banks can try to, you know, 211 00:11:57,280 --> 00:12:00,960 Speaker 1: walk that fine line between becoming a lot more efficient 212 00:12:01,559 --> 00:12:06,120 Speaker 1: and without destroying their you know, political and regulatory reputations 213 00:12:06,559 --> 00:12:09,280 Speaker 1: and also their E s G scores because everyone's watching. 214 00:12:09,600 --> 00:12:11,200 Speaker 1: You know, if you fire a lot of people, that 215 00:12:11,280 --> 00:12:14,319 Speaker 1: hurts your interesting E s G scores. And so it's 216 00:12:14,320 --> 00:12:16,200 Speaker 1: a it's a it's a tough job. It's a different 217 00:12:16,280 --> 00:12:18,640 Speaker 1: job to be a bank deo today. In the past, 218 00:12:18,679 --> 00:12:23,840 Speaker 1: it was about creating, generating sustained long term value. Today 219 00:12:23,880 --> 00:12:25,959 Speaker 1: it's doing that and a lot more. You need to 220 00:12:26,000 --> 00:12:30,079 Speaker 1: be more tuned to issues around climate UH and social 221 00:12:30,120 --> 00:12:34,040 Speaker 1: issues UM and diversity, and so it's a bigger challenge. 222 00:12:34,400 --> 00:12:39,720 Speaker 1: What does that mean for the physical presence on main Street, Well, 223 00:12:39,760 --> 00:12:41,840 Speaker 1: a lot less branches. You're going to see a lot 224 00:12:41,960 --> 00:12:45,280 Speaker 1: less branches and a lot less people per branch. And 225 00:12:45,640 --> 00:12:48,200 Speaker 1: they call it d I Y do it yourself and 226 00:12:48,280 --> 00:12:52,000 Speaker 1: also more do it together services. So you'll see banks, 227 00:12:52,320 --> 00:12:55,080 Speaker 1: you know, working with customers that show them how to 228 00:12:55,160 --> 00:13:00,320 Speaker 1: adapt to using more digital tools. And the pandemic Herbo 229 00:13:00,520 --> 00:13:04,559 Speaker 1: charged the tech revolution at banks. You can't force a 230 00:13:04,720 --> 00:13:08,280 Speaker 1: change in customer behavior, but the pandemic did so, and 231 00:13:08,320 --> 00:13:12,439 Speaker 1: that played into the banking industry's strategic UH playbook for 232 00:13:12,440 --> 00:13:14,199 Speaker 1: the next five or ten years. Mike, when you talk 233 00:13:14,240 --> 00:13:16,880 Speaker 1: about competition from a number of different sources, we should 234 00:13:16,880 --> 00:13:19,839 Speaker 1: also talk about competition from the Federal Reserve itself, for forum, 235 00:13:19,880 --> 00:13:22,800 Speaker 1: the US government, the Federal Reserve saying yesterday that they're 236 00:13:22,800 --> 00:13:25,280 Speaker 1: going to put out a report on the US digital 237 00:13:25,280 --> 00:13:29,120 Speaker 1: dollar debate this summer that could disintermediate the big banks. 238 00:13:29,160 --> 00:13:32,840 Speaker 1: How much you paying attention to this, Well, you have 239 00:13:32,920 --> 00:13:35,319 Speaker 1: to pay attention to this. I mean there's threats to 240 00:13:35,480 --> 00:13:40,280 Speaker 1: banks and disenter mediation of banking goes back half a century, 241 00:13:40,520 --> 00:13:43,840 Speaker 1: and so you first saw that with traditional bank loans 242 00:13:43,920 --> 00:13:47,800 Speaker 1: getting the center mediated to the capital markets, and then 243 00:13:47,840 --> 00:13:50,840 Speaker 1: you've seen that with some of the fintech players and 244 00:13:50,880 --> 00:13:53,439 Speaker 1: the payments business, and so you have to watch, you know, 245 00:13:53,480 --> 00:13:58,439 Speaker 1: anything related to you know, digital uh currencies or anything else. 246 00:13:58,760 --> 00:14:03,600 Speaker 1: Having said that, I think the banking industries business model 247 00:14:03,720 --> 00:14:09,160 Speaker 1: resiliency for the largest banks is underappreciated. And a deposit 248 00:14:09,280 --> 00:14:12,280 Speaker 1: at a large bank is different than a deposit at 249 00:14:12,320 --> 00:14:16,679 Speaker 1: another bank. It's driven by a hybrid distribution system that's 250 00:14:16,720 --> 00:14:20,640 Speaker 1: physical and digital. It's driven by multiproducts, whether it's a 251 00:14:20,720 --> 00:14:25,520 Speaker 1: checking account, savings account, credit card, mortgage investment. So, um, yes, 252 00:14:25,680 --> 00:14:28,720 Speaker 1: you have to watch this. But the death of banks 253 00:14:28,720 --> 00:14:32,480 Speaker 1: has been greatly exaggerated the last few decades. Mike, perhaps 254 00:14:32,480 --> 00:14:34,480 Speaker 1: the death of banks, but just quickly here, I'm wondering 255 00:14:34,520 --> 00:14:36,840 Speaker 1: what you think in terms of mergers and acquisitions, how 256 00:14:36,880 --> 00:14:39,840 Speaker 1: consolidated could the industry get as they cut what you 257 00:14:39,960 --> 00:14:44,480 Speaker 1: estimate to be two hundred thousand jobs. Absolutely, there should 258 00:14:44,480 --> 00:14:48,000 Speaker 1: be an acceleration and bank mergers. Goliath is winning. The 259 00:14:48,080 --> 00:14:51,760 Speaker 1: largest banks have scale, The smaller banks need to generate 260 00:14:51,800 --> 00:14:54,440 Speaker 1: that scale. That was mentioned as the number one reason 261 00:14:54,880 --> 00:14:57,280 Speaker 1: for the biggest recent merger in the last few years 262 00:14:57,280 --> 00:15:00,400 Speaker 1: now known as as truest Um. So we wouldn't be 263 00:15:00,440 --> 00:15:03,200 Speaker 1: surprised to see half the number of banks out there 264 00:15:03,760 --> 00:15:07,600 Speaker 1: over the next decade. Just before we run, Mike, a 265 00:15:07,600 --> 00:15:10,280 Speaker 1: lot has been made of v SG and diversity, and 266 00:15:10,320 --> 00:15:12,520 Speaker 1: you touched on that yourself in this conversation. You would 267 00:15:12,640 --> 00:15:14,600 Speaker 1: want to bring it up. Why do you think that 268 00:15:14,680 --> 00:15:16,840 Speaker 1: wasn't a big part of the consideration for Morgan Stanley 269 00:15:16,920 --> 00:15:22,280 Speaker 1: shake up. Look, ultimately, um, you know, the ability of 270 00:15:22,400 --> 00:15:27,160 Speaker 1: managers to generate the returns helped the firm as a 271 00:15:27,200 --> 00:15:31,040 Speaker 1: whole um and represent the firm you know drives these decisions. 272 00:15:31,160 --> 00:15:35,680 Speaker 1: And so Jamie Diamond didn't select the two women coheads 273 00:15:35,720 --> 00:15:38,800 Speaker 1: of consumer who are likely the next one of those 274 00:15:38,800 --> 00:15:41,760 Speaker 1: are the next successor because they're women. It's because they're 275 00:15:41,760 --> 00:15:44,280 Speaker 1: the most capable. So I think the chips ball where 276 00:15:44,320 --> 00:15:47,280 Speaker 1: they will, well said Mike, Thank you, Mike Mayo West 277 00:15:47,320 --> 00:15:50,000 Speaker 1: Farco ahead of US large cap bank research on a 278 00:15:50,080 --> 00:15:58,280 Speaker 1: situation on Wall Street. Terry Hinges joins US now with 279 00:15:58,360 --> 00:16:01,880 Speaker 1: Venia policy. Their under here in a good student of 280 00:16:01,880 --> 00:16:06,920 Speaker 1: the dynamics of Washington, Terry. There's isolationism in America. It's 281 00:16:06,960 --> 00:16:10,480 Speaker 1: always been there, back to the founders, a certain character, 282 00:16:10,600 --> 00:16:13,400 Speaker 1: let's say, in the pre World War Two era, all 283 00:16:13,480 --> 00:16:18,720 Speaker 1: sorts of shades. After World War Two, a unique Trump isolationism, 284 00:16:18,840 --> 00:16:22,120 Speaker 1: a sense there, and now with Israel, Gaza, and even 285 00:16:22,160 --> 00:16:24,600 Speaker 1: with this announcement from the I m F for a 286 00:16:24,760 --> 00:16:29,120 Speaker 1: cash call, a new isolationism in Washington. What does that 287 00:16:29,200 --> 00:16:33,520 Speaker 1: look like? Uh, Tom, good morning. What I think it 288 00:16:33,600 --> 00:16:39,440 Speaker 1: looks like is a essentially a rebalancing of international responsibilities 289 00:16:39,480 --> 00:16:43,320 Speaker 1: with the with domestic responsibilities. There's a I think there's 290 00:16:43,320 --> 00:16:45,120 Speaker 1: a sense, and there's been a sense for about five 291 00:16:45,240 --> 00:16:48,080 Speaker 1: or six years that frankly I think predates Trump. Uh, 292 00:16:48,200 --> 00:16:51,240 Speaker 1: that we've been spending too much time and effort thinking 293 00:16:51,240 --> 00:16:54,720 Speaker 1: globalism is going to solve all our problems and instead 294 00:16:54,920 --> 00:16:59,320 Speaker 1: understanding that it's exacerbated a lot. What I'll shorthand is 295 00:16:59,360 --> 00:17:03,360 Speaker 1: the flyover country problem and try a fly over part 296 00:17:03,840 --> 00:17:07,399 Speaker 1: nation problem. And uh, and we ought to be spending 297 00:17:07,400 --> 00:17:09,760 Speaker 1: some more time with that. So you know, we're back 298 00:17:09,760 --> 00:17:12,960 Speaker 1: to the old wrangle of exactly how much time and 299 00:17:12,960 --> 00:17:16,119 Speaker 1: effort we ought to be spending on domestic priorities as 300 00:17:16,119 --> 00:17:19,280 Speaker 1: opposed to worrying about the international and you know, frankly, 301 00:17:19,320 --> 00:17:22,600 Speaker 1: that complicates policy making across the board. Do you ascribe 302 00:17:22,600 --> 00:17:25,720 Speaker 1: to the tradition that foreign policy doesn't matter when people 303 00:17:25,760 --> 00:17:29,160 Speaker 1: waltz into the two thousand twenty two or two thousand 304 00:17:29,200 --> 00:17:32,080 Speaker 1: twenty four booth or does it matter this time around? 305 00:17:33,560 --> 00:17:36,120 Speaker 1: I think it matters to them always. Frankly. There there 306 00:17:36,119 --> 00:17:42,240 Speaker 1: are always issues that that that differentiate candidates. Uh. And 307 00:17:42,440 --> 00:17:44,439 Speaker 1: you know, we we see a lot of those happening 308 00:17:44,560 --> 00:17:47,440 Speaker 1: right now. You've already you've already hit on it with 309 00:17:47,520 --> 00:17:51,200 Speaker 1: the part of it with Middle East policy. Uh. China. 310 00:17:51,760 --> 00:17:55,520 Speaker 1: China policy, of course is a very big and you know, 311 00:17:55,600 --> 00:17:59,600 Speaker 1: frankly bipartisan initiative at this point that anybody that wanted 312 00:17:59,640 --> 00:18:02,240 Speaker 1: to change China policy at this point would be looked 313 00:18:02,240 --> 00:18:06,400 Speaker 1: at very skeptically. Uh. You know, the eyeballs on Russia, 314 00:18:06,520 --> 00:18:09,240 Speaker 1: same thing. Uh, just to name three off the top. 315 00:18:09,320 --> 00:18:12,080 Speaker 1: But yeah, it does matter to It does matter to voters. 316 00:18:12,560 --> 00:18:15,280 Speaker 1: Let's jump to June, the president's first big obous trip, 317 00:18:15,320 --> 00:18:16,720 Speaker 1: when he's going to go go over to Europe. What do 318 00:18:16,760 --> 00:18:20,840 Speaker 1: you think the priorities are the priorities for them are 319 00:18:21,240 --> 00:18:23,680 Speaker 1: they want to show Firstly, they want to show off, 320 00:18:24,359 --> 00:18:29,440 Speaker 1: uh that they're America's back them, that they want uh 321 00:18:29,520 --> 00:18:33,480 Speaker 1: to show cozy relationships across the board with the European 322 00:18:33,560 --> 00:18:35,880 Speaker 1: Union number one. Number two, they actually want to show 323 00:18:35,920 --> 00:18:38,800 Speaker 1: how they're moving the ball forward, and they're gonna have 324 00:18:38,880 --> 00:18:42,719 Speaker 1: to get past this, uh, this nord Stream problem and 325 00:18:42,800 --> 00:18:45,760 Speaker 1: put it into a broader context to show how that 326 00:18:45,840 --> 00:18:50,560 Speaker 1: decision to wave sanctions there is positive for other aspects 327 00:18:50,600 --> 00:18:53,560 Speaker 1: of the European project. And third, they want to show 328 00:18:53,680 --> 00:18:58,120 Speaker 1: united front against Russia, but more importantly China. Uh, that's 329 00:18:58,119 --> 00:19:00,680 Speaker 1: where they go. They've got a Germany of them, haven't they. 330 00:19:00,800 --> 00:19:02,680 Speaker 1: With that in mind, Harry, not so much as a 331 00:19:03,040 --> 00:19:07,399 Speaker 1: European problem is a Germany problem. Yeah, yeah, exactly. You know, 332 00:19:07,880 --> 00:19:10,159 Speaker 1: there's some wags and Brussels always say if Hitler had 333 00:19:10,240 --> 00:19:15,240 Speaker 1: understood that Dolly to do was to conquered everybody economically, uh, 334 00:19:15,359 --> 00:19:18,480 Speaker 1: as Germany has with the the U. Uh. You know 335 00:19:18,640 --> 00:19:20,679 Speaker 1: that we wouldn't have had the Second World War. But 336 00:19:20,760 --> 00:19:24,360 Speaker 1: the more important part of this is that, uh, you've 337 00:19:24,359 --> 00:19:26,639 Speaker 1: got a new government, You've got more instability in Germany 338 00:19:26,680 --> 00:19:28,159 Speaker 1: for the first time in a long time. You've got 339 00:19:28,200 --> 00:19:31,000 Speaker 1: a new government, a new way of looking at things. Uh. 340 00:19:31,280 --> 00:19:34,480 Speaker 1: Some people say a loss of confidence. Uh. So that 341 00:19:34,640 --> 00:19:38,000 Speaker 1: is that those are all variables that the administration is 342 00:19:38,000 --> 00:19:40,120 Speaker 1: going to have to work with to resolve. So it's 343 00:19:40,119 --> 00:19:42,040 Speaker 1: a higher mountain than it was just a few months ago. 344 00:19:42,080 --> 00:19:44,280 Speaker 1: I meanwhile, here at home, Terry, one reason why I 345 00:19:44,320 --> 00:19:47,879 Speaker 1: love reading your reports is because you actually assign probabilities 346 00:19:47,920 --> 00:19:51,680 Speaker 1: to the likelihood of certain legislative initiatives getting passed. Where 347 00:19:51,720 --> 00:19:55,200 Speaker 1: are we in terms of the probability of a bipartisan 348 00:19:55,359 --> 00:20:00,000 Speaker 1: infrastructure bill getting passed in the near term, Well, thank you, Liza, 349 00:20:00,000 --> 00:20:03,280 Speaker 1: and and you know I've been non consensus uh was 350 00:20:03,359 --> 00:20:07,920 Speaker 1: non consensus uh about sixty six for some time on that. 351 00:20:08,000 --> 00:20:11,320 Speaker 1: I think that's coming together, Uh, in a kind of 352 00:20:11,680 --> 00:20:14,680 Speaker 1: eight hundred billion to one trillion range at the top. 353 00:20:15,040 --> 00:20:17,520 Speaker 1: There's clearly a desire to want to do something there, 354 00:20:17,680 --> 00:20:21,879 Speaker 1: and on a bipartisan basis, it amounts to a plus 355 00:20:21,960 --> 00:20:24,680 Speaker 1: up of about a hundred percent over what we would 356 00:20:24,680 --> 00:20:28,480 Speaker 1: be spending on infrastructure anyway. So it's not insignificant, but 357 00:20:28,600 --> 00:20:30,720 Speaker 1: it would take a quite a while to roll out. 358 00:20:31,320 --> 00:20:34,480 Speaker 1: The bigger question is that you know whether or not, uh, 359 00:20:34,600 --> 00:20:37,320 Speaker 1: it's gonna be able to roll out faster. It doesn't 360 00:20:37,359 --> 00:20:40,280 Speaker 1: sound like that's gonna happen, So the people won't see 361 00:20:40,280 --> 00:20:43,640 Speaker 1: in businesses won't see a difference to that very much. 362 00:20:44,000 --> 00:20:46,280 Speaker 1: And I also think it makes the the what the 363 00:20:46,280 --> 00:20:49,879 Speaker 1: administration calls the Family's Package, which is most of the 364 00:20:49,880 --> 00:20:53,040 Speaker 1: rest of us call everything else, uh, that much harder 365 00:20:53,080 --> 00:20:56,760 Speaker 1: to get. Democrats will understand that the last train is 366 00:20:56,760 --> 00:20:59,160 Speaker 1: going to leave the station. They want everything they want 367 00:20:59,200 --> 00:21:02,720 Speaker 1: in it. People tend to forget that the Affordable Care 368 00:21:02,760 --> 00:21:05,600 Speaker 1: Act had got passed on reconciliation, but it took something 369 00:21:05,640 --> 00:21:08,480 Speaker 1: like five months after the House at first passed it 370 00:21:08,600 --> 00:21:11,679 Speaker 1: to finalize it. And that's a positive case. So you know, 371 00:21:11,720 --> 00:21:14,480 Speaker 1: they're Washington is going to fool around with the Family's 372 00:21:14,520 --> 00:21:17,040 Speaker 1: Package into the winter and probably you know, i'd say 373 00:21:17,040 --> 00:21:18,840 Speaker 1: at least into the winter with the likelihood of that 374 00:21:18,840 --> 00:21:23,760 Speaker 1: getting passed. If I have that very much below at 375 00:21:23,760 --> 00:21:26,679 Speaker 1: this point, I'll give you, I'll give you it's alive 376 00:21:26,720 --> 00:21:29,040 Speaker 1: and kicking it, but I don't see the path forward 377 00:21:29,160 --> 00:21:31,640 Speaker 1: for it right now. Jerry. We had the privilege speaking 378 00:21:31,680 --> 00:21:35,280 Speaker 1: to the Republican from Montana yesterday, Steve Danes, and it 379 00:21:35,359 --> 00:21:39,480 Speaker 1: was really good conversation. I am fascinated by how you 380 00:21:39,600 --> 00:21:45,320 Speaker 1: translate the middle ground of American politics is personified by 381 00:21:45,400 --> 00:21:49,720 Speaker 1: John Tester and Steve Danes in Montana. What's the future 382 00:21:49,800 --> 00:21:57,480 Speaker 1: of the middle in America if Montana is living it? Um, 383 00:21:57,520 --> 00:21:59,479 Speaker 1: you know what, those are two very smart members. I've 384 00:21:59,520 --> 00:22:02,000 Speaker 1: had the plug her to spend a fair amount of 385 00:22:02,000 --> 00:22:05,480 Speaker 1: time with Senator Tester over the years. And uh, he's 386 00:22:05,480 --> 00:22:09,880 Speaker 1: a very capable senator. The U and and somebody's really 387 00:22:09,880 --> 00:22:13,959 Speaker 1: looking out for things the you know, the the uh. 388 00:22:14,240 --> 00:22:18,800 Speaker 1: The way people present themselves these days is market themselves 389 00:22:18,840 --> 00:22:23,680 Speaker 1: in politics is polarized, they'd say, necessarily so. But there's 390 00:22:23,680 --> 00:22:25,480 Speaker 1: an awful lot of people trying to figure out what 391 00:22:25,520 --> 00:22:28,480 Speaker 1: the middle ground is and and work on it from there. 392 00:22:29,040 --> 00:22:31,760 Speaker 1: We're losing some of those good people, people like Rob 393 00:22:31,840 --> 00:22:34,640 Speaker 1: Portman and Pat Toomey, but as you point out, people 394 00:22:34,680 --> 00:22:38,320 Speaker 1: like Tester and Danes are still there, and uh, you know, 395 00:22:38,359 --> 00:22:42,240 Speaker 1: between him, people like Tim Scott, for example. I think 396 00:22:42,280 --> 00:22:45,440 Speaker 1: there's there's still an awful lot of people in the Congress, 397 00:22:45,440 --> 00:22:48,439 Speaker 1: particularly in the Senate, that are looking to try to 398 00:22:48,520 --> 00:22:52,760 Speaker 1: figure out exactly how to deal with the what we'll 399 00:22:52,760 --> 00:22:55,600 Speaker 1: call the problems of the middle uh and UH and 400 00:22:55,720 --> 00:22:59,119 Speaker 1: improve things, so you know, I remain optimistic about that 401 00:22:59,160 --> 00:23:01,600 Speaker 1: in the long term. Terry, go ahead from you as 402 00:23:01,600 --> 00:23:04,840 Speaker 1: always Terry hinesad panchea policy founder and the latest down 403 00:23:04,840 --> 00:23:12,959 Speaker 1: in d C. Right now, Lisa Browns and I welcome 404 00:23:13,000 --> 00:23:17,280 Speaker 1: you to, without question, your most important conversation of the day, 405 00:23:17,680 --> 00:23:20,359 Speaker 1: because it's what we all do as we break red 406 00:23:20,400 --> 00:23:23,960 Speaker 1: before the pandemic. In this pandemic and coming out of 407 00:23:23,960 --> 00:23:27,199 Speaker 1: the pandemic, there is flat out no one in the 408 00:23:27,240 --> 00:23:31,000 Speaker 1: restaurant and food business who has committed to optimism more 409 00:23:31,400 --> 00:23:33,959 Speaker 1: than Daniel Ballut. He joins us this morning with an 410 00:23:34,000 --> 00:23:37,840 Speaker 1: eleven thousand foot triumphant Grand Central Station and the new 411 00:23:37,920 --> 00:23:40,800 Speaker 1: Vanderbilt Tower. Daniel, thank you so much for joining us 412 00:23:40,800 --> 00:23:45,920 Speaker 1: on La Pavillon in the success. This is huge, huge optimism. 413 00:23:45,920 --> 00:23:48,959 Speaker 1: How urgent is it for you to fill every seat 414 00:23:49,280 --> 00:23:53,040 Speaker 1: starting yesterday? Well, thank you tomb for having me on 415 00:23:53,119 --> 00:23:56,679 Speaker 1: good morning. Um, of course it's us to open a 416 00:23:56,680 --> 00:24:01,199 Speaker 1: new restaurant, always for anyone, but it is huge in 417 00:24:01,440 --> 00:24:04,800 Speaker 1: this time because we really feel that we are coming 418 00:24:04,960 --> 00:24:08,639 Speaker 1: out of the pandemic and it's time to bring the 419 00:24:08,680 --> 00:24:12,639 Speaker 1: city back together. And I think for me, it's not 420 00:24:12,760 --> 00:24:15,920 Speaker 1: about how many sick, can we feel and all that, 421 00:24:16,000 --> 00:24:20,920 Speaker 1: but just bring back jobs, bring back hope, and and 422 00:24:21,119 --> 00:24:24,080 Speaker 1: have the opportunity to create something new and unique and 423 00:24:24,280 --> 00:24:28,240 Speaker 1: one Vanderbilt the project finish on time, finish on budget 424 00:24:28,600 --> 00:24:32,320 Speaker 1: throughout the year the pandemic. It never we had slowed down, 425 00:24:32,359 --> 00:24:35,680 Speaker 1: but we never stopped. And I think that's uh, that's 426 00:24:35,720 --> 00:24:38,879 Speaker 1: something which I'm very proud of to be associated with 427 00:24:39,080 --> 00:24:43,760 Speaker 1: sl Green and the project there because the project kept ongoing. 428 00:24:44,560 --> 00:24:47,120 Speaker 1: When you came to New York, you couldn't get into 429 00:24:47,160 --> 00:24:49,639 Speaker 1: the fancy restaurants. You were a pittle and chef and 430 00:24:49,680 --> 00:24:52,119 Speaker 1: nobody wanted to talk to you anything like that. I 431 00:24:52,160 --> 00:24:53,720 Speaker 1: know now you pick up the phone and you get 432 00:24:53,760 --> 00:24:57,440 Speaker 1: my table instantly. What I want to know is will 433 00:24:57,520 --> 00:25:02,480 Speaker 1: we change how we eat after this horrific pandemic, whether 434 00:25:02,520 --> 00:25:05,800 Speaker 1: the fancy or the less fancy. Do you sense that 435 00:25:05,840 --> 00:25:11,439 Speaker 1: will change the way we approach food. I don't think so. 436 00:25:11,480 --> 00:25:14,359 Speaker 1: I think people want to go back to indulge. People 437 00:25:14,440 --> 00:25:18,159 Speaker 1: want to go back to be pampered, to be to 438 00:25:18,640 --> 00:25:22,200 Speaker 1: discover new restaurants, to be able to enjoy the food 439 00:25:22,240 --> 00:25:25,359 Speaker 1: to the fullest. And of course we are very conscious 440 00:25:25,440 --> 00:25:29,800 Speaker 1: and we have to keep our safety as a priority 441 00:25:29,960 --> 00:25:33,480 Speaker 1: for us the staff, we keep wearing masks. We try 442 00:25:33,520 --> 00:25:36,560 Speaker 1: to not make maybe so many dishes who can be 443 00:25:36,600 --> 00:25:42,480 Speaker 1: sharable and uh, and we try to really respect also 444 00:25:42,640 --> 00:25:48,160 Speaker 1: distance and timings or that so guests feel comfortable, people 445 00:25:48,200 --> 00:25:50,919 Speaker 1: are anxious to go out. And uh, I see in 446 00:25:50,920 --> 00:25:54,720 Speaker 1: my restaurant at Danielle or Babble also that Terras is 447 00:25:55,280 --> 00:25:58,359 Speaker 1: so much in demand now. It's fantastic, volute. Whenever you 448 00:25:58,359 --> 00:25:59,960 Speaker 1: walk down the street in New York City, you see 449 00:26:00,000 --> 00:26:02,760 Speaker 1: all of the restaurants absolutely flooded with people looking to 450 00:26:02,840 --> 00:26:05,080 Speaker 1: get back. There is a question though, and you're not 451 00:26:05,160 --> 00:26:08,159 Speaker 1: seeing that in Midtown. In Midtown it still is a 452 00:26:08,200 --> 00:26:10,960 Speaker 1: bit of a ghost town as offices still try to 453 00:26:11,080 --> 00:26:13,720 Speaker 1: bring some workers back and have a questionable time frame. 454 00:26:13,960 --> 00:26:16,480 Speaker 1: What does the power launch of the post pandemic era 455 00:26:16,600 --> 00:26:19,840 Speaker 1: look like, Well, right now it looks like nothing because 456 00:26:19,880 --> 00:26:22,560 Speaker 1: there's not that many restaurants up and for power lunch. 457 00:26:23,000 --> 00:26:27,359 Speaker 1: But I think, uh, there's definitely a bus in Midtown, 458 00:26:27,600 --> 00:26:31,439 Speaker 1: and I see around Grand Central, I see people coming 459 00:26:31,440 --> 00:26:35,000 Speaker 1: back to the office, and we have people coming out 460 00:26:35,040 --> 00:26:37,040 Speaker 1: of work and coming to have a drink at the 461 00:26:37,040 --> 00:26:40,840 Speaker 1: bar at La Pavillon. But so that means they must 462 00:26:40,880 --> 00:26:45,119 Speaker 1: have been working around there. And I think Power Lunch 463 00:26:45,160 --> 00:26:48,240 Speaker 1: will come back in September, resume when the all the 464 00:26:48,240 --> 00:26:51,440 Speaker 1: hotels are open. New York is back, and I think 465 00:26:51,480 --> 00:26:55,000 Speaker 1: the office will bring back people because they have to. Well, 466 00:26:55,119 --> 00:26:59,000 Speaker 1: when you talk Chapalad about the cities that are going 467 00:26:59,040 --> 00:27:01,840 Speaker 1: to be the culinary leader is going forward, what do 468 00:27:01,880 --> 00:27:04,399 Speaker 1: you hear from your peers, from your fellow chefs in 469 00:27:04,480 --> 00:27:06,919 Speaker 1: terms of which cities are the best ones to open 470 00:27:07,800 --> 00:27:11,680 Speaker 1: a higher end restaurant. Well, I think New York City 471 00:27:11,800 --> 00:27:14,879 Speaker 1: is still the number one city for sure. I mean there's, 472 00:27:15,000 --> 00:27:17,280 Speaker 1: of course, you can always be a big fish in 473 00:27:17,320 --> 00:27:20,480 Speaker 1: a small pound. But in New York City, I think 474 00:27:20,560 --> 00:27:27,640 Speaker 1: we have the capability for welcoming tourists and business and 475 00:27:27,840 --> 00:27:32,040 Speaker 1: entertainment and sports in that no other city can. And 476 00:27:32,119 --> 00:27:34,520 Speaker 1: of course there's the hype of Miami. There's that have, 477 00:27:35,000 --> 00:27:37,720 Speaker 1: But when it comes to find dining and when it 478 00:27:37,800 --> 00:27:40,760 Speaker 1: comes to all dining, I think New York City and 479 00:27:40,880 --> 00:27:45,320 Speaker 1: clearing all neighborhoods. It's amazing. And you know, people are 480 00:27:45,359 --> 00:27:47,639 Speaker 1: craving to come back to New York City. I see 481 00:27:48,080 --> 00:27:52,480 Speaker 1: the double deck bus passing by the Pabion because it's 482 00:27:52,520 --> 00:27:55,840 Speaker 1: on the second floor. I see the double deck bus 483 00:27:55,880 --> 00:27:58,959 Speaker 1: full of people and I'm like, wow, is there's some 484 00:27:59,040 --> 00:28:02,480 Speaker 1: tourist back and I here concierge according us and telling 485 00:28:02,520 --> 00:28:05,280 Speaker 1: us the hotel are reopening. So it's it's it's a 486 00:28:05,400 --> 00:28:08,800 Speaker 1: good sign. I mean, just a question of for the 487 00:28:09,240 --> 00:28:11,640 Speaker 1: all the office building to be able to bring back 488 00:28:11,640 --> 00:28:16,040 Speaker 1: their staff, and certainly the unemployment tourisum so we can 489 00:28:16,200 --> 00:28:20,000 Speaker 1: bring people back to work. The romance Daniel of of 490 00:28:20,000 --> 00:28:22,640 Speaker 1: of being a grand central station and looking out that 491 00:28:22,680 --> 00:28:25,800 Speaker 1: window of the Chrysler building, it speaks back to La 492 00:28:25,920 --> 00:28:31,360 Speaker 1: Pavillon of N two as well. Boy, if we changed 493 00:28:31,440 --> 00:28:35,840 Speaker 1: how we eat now, what's your biggest challenge in developing 494 00:28:35,960 --> 00:28:40,160 Speaker 1: repeat customers? What is the food angle, the menu angle 495 00:28:40,560 --> 00:28:43,000 Speaker 1: that you need to do in two thousand twenty one 496 00:28:43,280 --> 00:28:49,240 Speaker 1: to keep them coming in? Interestingly enough, yes, vegetable is 497 00:28:49,280 --> 00:28:53,360 Speaker 1: the rage. But twenty four years ago went up in 498 00:28:53,440 --> 00:28:56,400 Speaker 1: Cafebruary in New York. I had already a vegetarian menu, 499 00:28:56,920 --> 00:29:00,400 Speaker 1: and so this I expanded more and so look beyond 500 00:29:00,440 --> 00:29:05,480 Speaker 1: the menu will be see food for vegetable and ten 501 00:29:05,560 --> 00:29:10,440 Speaker 1: percent of selected high quality meat. And so there's definitely 502 00:29:10,680 --> 00:29:14,760 Speaker 1: a trend between um, I wanted to have a certain 503 00:29:15,760 --> 00:29:20,080 Speaker 1: uh focus on the locality, so the New England for 504 00:29:20,120 --> 00:29:24,040 Speaker 1: the most part, and also vegetable within the five state 505 00:29:24,320 --> 00:29:28,160 Speaker 1: state around New York, and I think this will be 506 00:29:28,280 --> 00:29:33,000 Speaker 1: our focus there. But um, in general, people are craving 507 00:29:33,120 --> 00:29:36,760 Speaker 1: for good food, good wine, and of course healthy food. 508 00:29:36,880 --> 00:29:42,280 Speaker 1: That's our responsibility, a colossal financial risk. Really really interesting Daniable, 509 00:29:42,520 --> 00:29:46,880 Speaker 1: congratulations and launching La Pavon and just really really interesting 510 00:29:46,920 --> 00:29:49,760 Speaker 1: to see in the coming months is New York City 511 00:29:50,320 --> 00:29:53,520 Speaker 1: comes back? Thank you so a Daniable loud you claim restaurant. 512 00:29:54,240 --> 00:29:58,000 Speaker 1: This is the Bloomberg Surveillance Podcast. Thanks for listening. Join 513 00:29:58,120 --> 00:30:01,440 Speaker 1: us live weekdays from seventy ten a m. Eastern on 514 00:30:01,560 --> 00:30:05,800 Speaker 1: Bloomberg Radio and on Bloomberg Television each day from six 515 00:30:05,880 --> 00:30:10,760 Speaker 1: to nine am for insight from the best in economics, finance, investment, 516 00:30:10,880 --> 00:30:15,920 Speaker 1: and international relations. And subscribe to the Surveillance podcast on 517 00:30:16,000 --> 00:30:19,800 Speaker 1: Apple podcast, SoundCloud, Bloomberg dot com, and of course on 518 00:30:19,920 --> 00:30:24,120 Speaker 1: the terminal. I'm Tom Keene and this is Bloomberg