WEBVTT - Markets Ready for Powell as Walz Makes his Pitch 0:00:02.400 --> 0:00:06.760 Bloomberg Audio Studios, Podcasts, radio News. 0:00:11.800 --> 0:00:14.880 This is the Bloomberg Surveillance Podcast. I'm Paul Sweeney along 0:00:14.880 --> 0:00:17.240 with Tom Keen. Join us each day for insight from 0:00:17.239 --> 0:00:20.760 the best in economics, geopolitics, finance, and investment. You can 0:00:20.800 --> 0:00:24.439 also watch the show live on YouTube. Visit the Bloomberg 0:00:24.480 --> 0:00:27.760 Podcast channel on YouTube to see the show weekday mornings 0:00:27.760 --> 0:00:30.400 from seven to ten Eastern Remark Global headquarters at New 0:00:30.480 --> 0:00:33.720 York City. Subscribe to the podcast on Apple, Spotify, or 0:00:33.760 --> 0:00:36.800 anywhere else you listen, and as always on Bloomberg Radio, 0:00:36.840 --> 0:00:39.920 the Bloomberg Terminal, and the Bloomberg Business App. Russ Coaster 0:00:40.000 --> 0:00:42.360 Rich a global head of app investment Strategy at black 0:00:42.400 --> 0:00:46.880 Rock Scientific Active Equities. Hey, Russ, we've heard, I guess 0:00:46.960 --> 0:00:51.080 you know for a while now about the economic exceptionalism 0:00:51.200 --> 0:00:53.880 of the US economy visa the other parts of the world. 0:00:54.120 --> 0:00:56.520 Does that carry over for you in terms of where 0:00:56.640 --> 0:01:01.000 you look for active equity opportunities US versus rest of 0:01:01.000 --> 0:01:02.320 the world. How do you guys break that down? 0:01:03.400 --> 0:01:06.479 Thanks? Paul, You know it does, and it actually has 0:01:06.520 --> 0:01:10.200 an influence both bottom up and top down. Just to clarify, actually, 0:01:10.280 --> 0:01:13.080 I think bio might belittle data. I actually co manage 0:01:13.080 --> 0:01:16.399 the Global Allocation Fund Brick readers, so we have a 0:01:16.400 --> 0:01:19.920 global mandate and it does make a difference. And the 0:01:20.000 --> 0:01:22.160 reason is there are two ways to look at this. 0:01:22.240 --> 0:01:24.760 First of all, as you say, you know, the US exceptionalism, 0:01:25.120 --> 0:01:27.360 the strength of the economy, the fact that our labor 0:01:27.400 --> 0:01:31.319 market's been remarkably resilient, the consumer has been resilient. You 0:01:31.319 --> 0:01:33.760 think about the difference we're seen right now between the 0:01:33.880 --> 0:01:36.760 US consumer and the Chinese consumer. There are lots of 0:01:36.800 --> 0:01:39.240 reasons to focus on the US. But you know, there's 0:01:39.280 --> 0:01:43.080 another one that's not really captured just by the economic data, 0:01:43.080 --> 0:01:45.440 and that is when you look for companies that have 0:01:45.560 --> 0:01:48.480 the type of characteristics I think you want in this environment, 0:01:48.920 --> 0:01:53.840 revenue growth, profitability, stable margins, you just find more of 0:01:53.880 --> 0:01:59.160 them in the United States, where they're talking about technology, communication, healthcare, 0:01:59.360 --> 0:02:01.480 than anywhere else in the world. So I do think 0:02:01.800 --> 0:02:05.280 that the US exceptionalism, particularly in terms of the types 0:02:05.320 --> 0:02:08.320 of companies we find here, has given us a reason 0:02:08.360 --> 0:02:10.600 to stay overweight the United States. 0:02:10.840 --> 0:02:12.920 Hey Russ, it's been a while. It's really good to 0:02:13.000 --> 0:02:15.760 chat with you. So based on that, what do you 0:02:15.800 --> 0:02:18.560 think is happening with the dollar like the carry trade 0:02:18.600 --> 0:02:21.120 online from dollar yen that we saw, But then the 0:02:21.160 --> 0:02:22.960 dollar has been hit. I appreciate it's up today, but 0:02:23.000 --> 0:02:25.440 it doesn't feel like the downside to the dollar is 0:02:25.520 --> 0:02:27.560 over summer talking that you can do sort of a 0:02:27.600 --> 0:02:31.600 short term short how does that play into your allocation thesis. 0:02:32.639 --> 0:02:35.079 You know, we don't have a huge dollar position right now. 0:02:35.160 --> 0:02:37.360 I think we have seen weakness in the dollar. That 0:02:37.480 --> 0:02:40.800 probably says more about the fact that there's been a 0:02:40.919 --> 0:02:42.839 little bit well not a little bit, but a fair 0:02:42.880 --> 0:02:45.720 amount of data in the last few months that signals 0:02:45.720 --> 0:02:47.840 that the FED is finally going to start to be 0:02:47.880 --> 0:02:50.560 able to cut rates and alex as you know. You know, 0:02:50.560 --> 0:02:53.720 we started the year expecting not weep, but the market 0:02:54.120 --> 0:02:56.440 expecting seven race cuts and now we're going to get 0:02:56.440 --> 0:02:58.360 our first one in September. So this is giving a 0:02:58.400 --> 0:03:02.359 little bit an excuse for investors to sell the dollar. 0:03:02.880 --> 0:03:06.040 That said, I think one of the things that's happened 0:03:06.440 --> 0:03:08.600 that also is affecting the dollar is one thing the 0:03:08.639 --> 0:03:11.359 dollars did a good job of in twenty twenty two. 0:03:11.360 --> 0:03:14.839 In twenty twenty three, it was hedging your equity risk. 0:03:14.880 --> 0:03:17.000 In other words, when the market was going down, the 0:03:17.080 --> 0:03:19.680 dollar was going up, and in that way, it was 0:03:19.720 --> 0:03:22.880 serving a role that bonds used to play. Is the 0:03:22.919 --> 0:03:25.240 dollar's been weaker lately, you know, we're not seeing as 0:03:25.440 --> 0:03:27.760 much of a role for the dollar as a head, 0:03:27.919 --> 0:03:31.520 so we've really been keeping our currency exposure pretty close 0:03:31.520 --> 0:03:32.960 to home. Russ. 0:03:33.000 --> 0:03:34.600 I'm just looking at the vics here, we're you know, 0:03:35.320 --> 0:03:38.480 sixteen right here. But boy, two weeks ago Monday, this 0:03:38.480 --> 0:03:42.000 thing exploded out to north of sixty. Well what do 0:03:42.040 --> 0:03:43.880 you make over the last two two and a half 0:03:43.960 --> 0:03:45.560 weeks of this market volatility? 0:03:46.400 --> 0:03:48.920 Yeah, Paul, that that was incredible. And really, you know, 0:03:48.960 --> 0:03:51.120 if someone sent me a great chart on that, it 0:03:51.160 --> 0:03:53.240 looked at the previous spikes in the vics, you know, 0:03:53.560 --> 0:03:57.320 two thousand and eight during the financial crisis, twenty twenty 0:03:57.400 --> 0:04:00.440 during the pandemic. I mean, these were world change, gene 0:04:01.000 --> 0:04:04.480 events that had significant downside to them, and then you 0:04:04.560 --> 0:04:07.800 had this spike in the vicks. All of what we're 0:04:07.840 --> 0:04:11.520 looking back in hindsight two somewhat weak economic prints. So 0:04:11.520 --> 0:04:14.440 I think the short answer is it was way overdone 0:04:14.520 --> 0:04:17.480 and it said much more about the position of the market, 0:04:17.880 --> 0:04:21.120 a crowding and a number of trades or alliance on 0:04:21.200 --> 0:04:24.080 the end carry trade for a number of investors then 0:04:24.200 --> 0:04:27.640 set about that the macro environment. I think the reality is, yes, 0:04:27.680 --> 0:04:30.279 the economy is slowing. We had some evidence of that 0:04:30.640 --> 0:04:34.880 yesterday we had a revision to the non farm payroll numbers. 0:04:35.320 --> 0:04:38.480 But the economy is not collapsing. We still have decent 0:04:38.560 --> 0:04:41.320 retail sales. And I think that movement into vics a 0:04:41.320 --> 0:04:43.880 few weeks ago it was just way overdone. 0:04:43.400 --> 0:04:45.440 Right, And it's a whole idea that we're slowing. We're 0:04:45.480 --> 0:04:48.440 not slumping, we're normalizing. We're not falling off a cliff, 0:04:48.440 --> 0:04:51.000 and like squaring that is going to be It seems 0:04:51.000 --> 0:04:53.960 to be tricky for the markets talking about bonds. What's 0:04:54.000 --> 0:04:55.400 the best allocation here? 0:04:56.880 --> 0:04:59.360 So we've been bringing up our bond allocation. We've been 0:04:59.480 --> 0:05:02.600 underweight by for a very long time, mostly based on inflation, 0:05:03.120 --> 0:05:05.880 also based on supply. We're still a little bit underweight 0:05:06.279 --> 0:05:10.120 at the long end, which really reflects more supply concerns 0:05:10.120 --> 0:05:14.599 than concerns about inflation. But we have been buying back 0:05:14.760 --> 0:05:17.799 bonds mostly in the belly of the curve. So talking 0:05:17.839 --> 0:05:20.480 about that five year range, we also have a lot 0:05:20.480 --> 0:05:23.159 of bonds on our portfolio that we bought back in 0:05:23.240 --> 0:05:26.000 twenty one and twenty two. On the corporate side, high 0:05:26.040 --> 0:05:29.200 yield investment grade when spreads were wider. We're not really 0:05:29.279 --> 0:05:31.479 changing that much, but we're happy to keep clipping those 0:05:31.520 --> 0:05:34.719 coupons because in an environment, as you say, where the 0:05:34.760 --> 0:05:38.200 economy is slowly not collapsing, we're not very worried about 0:05:38.200 --> 0:05:40.800 the default rate, and for the first time in years, 0:05:40.880 --> 0:05:43.400 you can build a bond portfolio that's going to give 0:05:43.440 --> 0:05:46.200 you a six to seven percent yield without taking too 0:05:46.320 --> 0:05:47.360 much duration risk. 0:05:48.680 --> 0:05:51.440 Russ, how about this earning season We've just kind of 0:05:51.480 --> 0:05:54.440 wrapped up. Ernie's got a couple more retailers coming up here. 0:05:54.720 --> 0:05:57.120 What's your takeaway here, anything that kind of changed your 0:05:57.200 --> 0:05:59.000 outlook for these markets? 0:06:00.160 --> 0:06:03.640 It's funny. I think the earning season was actually pretty decent, 0:06:03.680 --> 0:06:06.600 and we came into expecting about nine percent year over 0:06:06.680 --> 0:06:09.280 year growth. We're probably going to do closer to thirteen percent, 0:06:09.680 --> 0:06:12.240 so earnings are solid. I think one of the things 0:06:12.279 --> 0:06:15.360 you did see, though, and this explains a lot of 0:06:15.360 --> 0:06:17.400 the weakness we saw in tech, at least the relative 0:06:17.440 --> 0:06:20.920 weakness back in late July and early August, was that 0:06:21.000 --> 0:06:24.359 the crossbar for many of these companies has been raised 0:06:24.400 --> 0:06:29.200 and just given the exceptional run we've had in software, semiconductors, 0:06:29.880 --> 0:06:32.440 many parts of technology during the first half of the year, 0:06:33.279 --> 0:06:36.560 what it took to satisfy investors, the level of beat 0:06:36.640 --> 0:06:39.479 you had to generate. There's certainly some evidence that that 0:06:39.600 --> 0:06:41.960 became higher. I think that's one of the reasons that 0:06:42.040 --> 0:06:44.800 you tech wobbled a little bit in early August and 0:06:44.880 --> 0:06:45.360 late July. 0:06:47.120 --> 0:06:49.479 What about money market funds? So you talk about like 0:06:49.480 --> 0:06:51.960 clipping a coupon, Like, why not? Okay, we have like 0:06:52.000 --> 0:06:54.440 six point two two trillion dollars in money market funds 0:06:54.520 --> 0:06:56.360 still sitting in a record. That thesis was that was 0:06:56.400 --> 0:06:59.279 going to go somewhere? Is it actually going to go somewhere? 0:06:59.279 --> 0:07:01.400 And I guess the question is how many rate cuts 0:07:01.440 --> 0:07:04.039 do we have to see for it to actually go somewhere. 0:07:05.440 --> 0:07:07.840 Well, I think it already is. You know, again, we 0:07:07.839 --> 0:07:12.560 were down about ten percent belows back on August fifth. 0:07:12.720 --> 0:07:15.240 We're now one and a half percent from the hive. 0:07:15.440 --> 0:07:18.720 So I do think you've seen that money provide a 0:07:18.720 --> 0:07:21.160 cushion to the market. And I do believe that as 0:07:21.160 --> 0:07:23.720 we start to get into this rate cutting cycle and 0:07:23.760 --> 0:07:25.760 people are looking at their statements and seeing that five 0:07:25.800 --> 0:07:27.240 and a quarter has gone down to four and a 0:07:27.280 --> 0:07:30.480 half or maybe closer to four next year. That's one 0:07:30.480 --> 0:07:33.360 of the factors that we think still allows the equity 0:07:33.400 --> 0:07:36.160 market to go higher into the back half of the year. 0:07:36.880 --> 0:07:38.880 Hey, Russ, thanks so much for joining us. Really appreciate 0:07:38.920 --> 0:07:40.600 getting a few minutes of your time. Is Russ Coaster 0:07:40.640 --> 0:07:54.920 Rich he's over there at Black Rocket. Julia Pollock joins us. 0:07:55.000 --> 0:07:57.840 She's a chief economist as ZIP recruiter. And if anybody 0:07:58.080 --> 0:07:59.760 has their finger on the pulse of this labor market, 0:08:00.040 --> 0:08:03.160 fucking folks at ZIP Recruiter, Julie, what's your view here 0:08:03.320 --> 0:08:05.560 of this US labor market. 0:08:07.440 --> 0:08:11.679 Well, the momentum is the issue. You know, in twenty 0:08:11.720 --> 0:08:15.680 eighteen twenty nineteen, when unemployment was around this level, it 0:08:15.760 --> 0:08:18.320 was coming down, and of course right before the pandemic 0:08:18.320 --> 0:08:21.640 it was just three point seven percent. So in a 0:08:21.720 --> 0:08:25.920 very short time it has broken that level and continued 0:08:25.920 --> 0:08:29.720 to rise. And the problem with unemployment is when it 0:08:29.840 --> 0:08:34.320 rises a little bit, or at least sufficiently, it tends 0:08:34.360 --> 0:08:36.760 to rise more in the coming months. It sets off 0:08:36.800 --> 0:08:39.640 a little bit of a cycle, and that is what 0:08:39.720 --> 0:08:41.280 we don't want to see right. 0:08:41.559 --> 0:08:44.000 So, clearly monitory policy is too tight. 0:08:44.320 --> 0:08:46.160 Right, So it's like a little bit can eventually go 0:08:46.240 --> 0:08:48.719 a long way in essence when the U three rate 0:08:48.760 --> 0:08:52.880 starts to rise. So what kind of labor do companies want? 0:08:52.920 --> 0:08:54.760 So they call you and they're like, hey, I need 0:08:54.800 --> 0:08:57.280 help finding these workers. What are those workers? 0:08:59.120 --> 0:09:01.360 So when love of employers is saying right now is 0:09:01.600 --> 0:09:03.800 we have lots of openings, we have lots of things 0:09:03.880 --> 0:09:06.120 we want to do, we have lots of growth plans, 0:09:06.600 --> 0:09:09.040 but we think will hire more on the back half 0:09:09.040 --> 0:09:11.440 of the year. And that's go for when interest rates 0:09:11.480 --> 0:09:14.360 come down, Like we're looking at the things we want 0:09:14.400 --> 0:09:16.920 to do and they don't pencil out right now with 0:09:17.480 --> 0:09:22.080 such prohibitively high credit costs. And that's what company has 0:09:22.120 --> 0:09:24.160 been saying for quite a while. I think many of 0:09:24.160 --> 0:09:27.880 them hoped that interest rates would start normalizing sooner. And 0:09:27.960 --> 0:09:30.280 so this is sort of a lost opportunity economy right now. 0:09:30.360 --> 0:09:34.280 So wait and see economy in healthcare, in government. Instead 0:09:34.280 --> 0:09:37.559 of industries that are completely kind of impervious to high 0:09:37.640 --> 0:09:39.800 interest rates that are insuated from them. 0:09:40.200 --> 0:09:41.439 It's still you. 0:09:41.400 --> 0:09:45.240 Know, hiring season, and employers are competing for talent like 0:09:45.360 --> 0:09:49.920 mad you know, healthcare demand for physicians, nurses, nurses, assistants, 0:09:49.920 --> 0:09:51.760 physicians assistants is off. 0:09:51.559 --> 0:09:54.480 The charts and really remains very very high. 0:09:54.960 --> 0:09:57.760 But you know, the economy outside of healthcare and the 0:09:57.800 --> 0:09:59.679 private sector outside of healthcare. 0:09:59.320 --> 0:10:01.520 Has been adding for very very few jobs. It's our 0:10:01.640 --> 0:10:02.920 employment has been growing. 0:10:02.760 --> 0:10:05.840 Unusually slowly there, and that's because everyone's kind of waiting 0:10:05.880 --> 0:10:06.880 to see what the that's going to do. 0:10:07.840 --> 0:10:10.920 So yesterday, Julia, we had the economic data about the 0:10:11.120 --> 0:10:14.040 the BLS data being revised down by I guess about 0:10:14.040 --> 0:10:17.280 eight hundred thousand or so. Right on my thirty five 0:10:17.360 --> 0:10:19.760 years on Wall Street, I never thought that was even 0:10:19.840 --> 0:10:22.400 an issue, but yesterday we made a big deal about it. 0:10:22.440 --> 0:10:23.400 What do you make about it? 0:10:25.160 --> 0:10:26.840 So I think doing statistics is hard. 0:10:27.040 --> 0:10:31.319 You know, we can't survey every employee and every employer 0:10:31.800 --> 0:10:37.120 every month, So we survey a little sample of them, 0:10:37.720 --> 0:10:42.840 and we have models and assumptions, and then once a year, 0:10:42.880 --> 0:10:46.760 when we get more comprehensive data, we test those assumptions. 0:10:46.200 --> 0:10:49.559 And adjust them. This is a normal process. 0:10:50.400 --> 0:10:54.000 I think people are confusing these annual benchmark revisions with 0:10:54.400 --> 0:10:56.599 the monthly revisions that take place that are usually in 0:10:56.640 --> 0:10:59.760 the tens of thousands. So people are thinking, wait, a 0:10:59.760 --> 0:11:02.360 say they usually revise the numbers by five or ten thousand. 0:11:02.440 --> 0:11:05.240 What do you mean eight hundred thousand? This is a conspiracy, 0:11:05.280 --> 0:11:08.080 you know, this is terrible. This is unbelievable. There's no 0:11:08.559 --> 0:11:10.880 your crazy business here, no conspiracy. 0:11:11.280 --> 0:11:15.160 This is something that happens. That's pretty normal in obviously 0:11:15.160 --> 0:11:17.120 in raw numbers. This is the biggest provision ever in 0:11:17.160 --> 0:11:21.000 percentage terms. It's actually, you know, lots so much bigger 0:11:21.040 --> 0:11:23.640 than normal. Under Trunk we had a revision like this 0:11:23.640 --> 0:11:27.440 of over four hundred thousand. So this is a normal 0:11:27.480 --> 0:11:31.280 part of the process. And doing statistics is especially hard 0:11:31.360 --> 0:11:34.840 when the underlying conditions changing right out. The lay market 0:11:34.920 --> 0:11:37.160 is slowing, and it's slowing pretty rapidly. 0:11:37.480 --> 0:11:38.960 Is what I tell my daughter when I'm helping her 0:11:38.920 --> 0:11:41.079 with her math. I was like, numbers are hard. Let's 0:11:41.120 --> 0:11:43.560 just because hards are hard. Yeah, So when you talked 0:11:43.559 --> 0:11:47.199 about the areas of the business cycle that are interested 0:11:47.240 --> 0:11:50.240 in hiring, et cetera, do you get a sense that 0:11:50.320 --> 0:11:54.720 there's a delay also because of election uncertainty, either delaying capex, 0:11:54.800 --> 0:11:57.720 delaying hiring just to see what's going to happen in 0:11:57.800 --> 0:11:59.880 terms of say taxes in the next six months. 0:12:02.000 --> 0:12:05.800 So look, you know, in some industries, if I were 0:12:05.840 --> 0:12:07.320 to tell you, hey, why don't you go in on 0:12:08.080 --> 0:12:10.920 with me on an investment in an oil well, you 0:12:11.000 --> 0:12:13.199 might say, hey, let's just see here, where's this election first? 0:12:13.240 --> 0:12:14.319 Maybe we'd rather want to. 0:12:14.240 --> 0:12:19.200 Put our money in a solar field, right, Like, there 0:12:19.240 --> 0:12:22.720 are some industries where it makes sense to pause investments 0:12:22.760 --> 0:12:26.000 now and see who gets into power, But in most 0:12:26.040 --> 0:12:30.840 industries it's not really going to make much of a difference. Frankly, Okay, 0:12:31.000 --> 0:12:35.040 you know, some policies that Democrats like will raise labor 0:12:35.080 --> 0:12:40.800 costs incrementally, and some policies that Republicans like, well, like 0:12:40.880 --> 0:12:45.720 we cut taxes. But overall it's not going to make 0:12:45.760 --> 0:12:50.719 a huge difference to the company's growth plans and strategy. 0:12:50.920 --> 0:12:54.280 So no, I think it causes a small delay in 0:12:54.360 --> 0:12:55.960 certain industries, but not much for. 0:12:56.080 --> 0:12:58.920 Than impact of the Hey, Julie, we're going to hear 0:12:58.960 --> 0:13:02.720 from fitzchairman Jpel tomorrow from Jackson Hole. What do you 0:13:02.800 --> 0:13:04.640 expect to hear? 0:13:06.559 --> 0:13:08.200 I think he's probably going to spend most of his 0:13:08.280 --> 0:13:13.160 time talking about what we now think the terminal interest rate, 0:13:13.240 --> 0:13:16.640 a long term interest rate should be. And you know, 0:13:16.679 --> 0:13:19.599 for a long time the fence projections have at it 0:13:19.679 --> 0:13:21.360 around two point five percent. 0:13:21.559 --> 0:13:23.000 It's been creeping up lately. 0:13:22.800 --> 0:13:25.360 Two point six percent, two point eight percent, and there 0:13:25.360 --> 0:13:28.880 are many economists to think that because the United States 0:13:29.120 --> 0:13:34.400 is just spending, spending like a drunken sailor, that rate has. 0:13:34.280 --> 0:13:37.200 Actually gone up. No one wants to hold our debt. 0:13:37.240 --> 0:13:41.280 A lot of these treasury auctions have been pretty lackluster, 0:13:42.000 --> 0:13:44.080 and we're probably going to have to offer a higher 0:13:44.080 --> 0:13:44.839 interest rate for being. 0:13:44.760 --> 0:13:47.840 Able to hold this stuff going forward because. 0:13:47.679 --> 0:13:50.440 There's just no discipline in DC and no restraint on 0:13:50.440 --> 0:13:53.480 either side, and one side wants to raise spending and 0:13:53.520 --> 0:13:54.280 one side. 0:13:54.040 --> 0:13:56.319 Wants to cut taxes, and there's. 0:13:56.120 --> 0:14:00.440 No one who wants to be a bring our fiscal 0:14:00.480 --> 0:14:05.480 house in order. So cutting Medicare, Medicaid and making adjustments 0:14:05.520 --> 0:14:07.680 is almost sort of off the table these days on 0:14:07.800 --> 0:14:12.040 both sides of the aisle. So the long term rate 0:14:12.160 --> 0:14:14.920 might be higher, probably some economy six three, three, four, 0:14:15.040 --> 0:14:15.600 five percent. 0:14:16.000 --> 0:14:18.000 Yeah, I don't think it's ever been truly on the 0:14:18.000 --> 0:14:22.040 table in a meaningful way. Circling back to the areas 0:14:22.080 --> 0:14:25.680 where you mentioned you still see growth like nursing care, 0:14:25.800 --> 0:14:29.960 elder care, right, are wages coming up to that? Are 0:14:29.960 --> 0:14:32.640 we seeing an increase in wages with the amount of 0:14:32.720 --> 0:14:36.280 job openings that we have, we are. 0:14:36.200 --> 0:14:39.000 And so the pandemic force was an unusual period where 0:14:39.040 --> 0:14:42.080 those wages shot up and there were lots of benefits 0:14:42.120 --> 0:14:45.480 to be had. But there are still many many hospitals 0:14:45.640 --> 0:14:49.000 that are trying to find ways to offer more training, assistance, 0:14:49.200 --> 0:14:54.040 to offer more help with living costs. So I mean 0:14:54.120 --> 0:14:56.240 that's that's the place where yes, we can expect to 0:14:56.280 --> 0:15:00.680 see wages continue to rise to incentivize the investments that 0:15:00.720 --> 0:15:02.880 people need to make in their human capital in order 0:15:02.920 --> 0:15:03.760 to get those jobs. 0:15:03.800 --> 0:15:05.720 And the training is not easy. 0:15:05.800 --> 0:15:10.280 You need to go to a nursing school or get 0:15:10.520 --> 0:15:11.880 licensed to stay out to date. 0:15:12.320 --> 0:15:15.200 So I do definitely need to show people. 0:15:14.920 --> 0:15:18.480 The money as a hard job. Yep, Juey, thank you 0:15:18.560 --> 0:15:20.400 so much for joining us. Really appreciate getting your thoughts 0:15:20.400 --> 0:15:35.160 your Joli Apollo, chief economist at ZIP Recruiter. Jonathan Tomorrow 0:15:35.200 --> 0:15:38.760 joins us. He's a Bloomberg reporter for Bloomberg Government. He 0:15:38.880 --> 0:15:43.040 is in Chicago. Jonathan, what do you expect to hear 0:15:43.520 --> 0:15:46.760 from Vice President Kamala Harris tonight and hear really big, 0:15:46.800 --> 0:15:47.680 big speech. 0:15:48.680 --> 0:15:50.560 Yeah, I think she's going to be talking about turning 0:15:50.600 --> 0:15:53.560 the page. And it's an interesting kind of situation in 0:15:53.600 --> 0:15:57.600 this campaign because she is effectively an incumbent, she's part 0:15:57.640 --> 0:16:00.880 of the administration, the number two, but she is presenting 0:16:00.880 --> 0:16:05.200 herself as the change candidate here, a change from both 0:16:05.320 --> 0:16:07.760 Joe Biden and from Donald Trump, even though he's out 0:16:07.760 --> 0:16:10.440 of office, he's kind of dominated the political conversation for 0:16:10.520 --> 0:16:14.600 a long time, and honestly, like a change in in 0:16:14.640 --> 0:16:17.840 the face of America as somebody who is part black, 0:16:17.960 --> 0:16:21.480 part Asian American, a woman, a change from you know, 0:16:21.600 --> 0:16:23.840 two older white men who had been on the ticket 0:16:23.880 --> 0:16:27.080 and who many voters did not like for a long time. 0:16:27.120 --> 0:16:30.000 Now, when we take a look at what's happening outside, 0:16:30.040 --> 0:16:32.640 there was a lot of worries about the protesters and 0:16:32.840 --> 0:16:34.920 there would be any violence, etc. Was this like a 0:16:34.960 --> 0:16:37.480 nineteen sixty eight situation? How has that played out? Like 0:16:37.480 --> 0:16:39.800 what's the mood outside on the ground. 0:16:40.960 --> 0:16:44.040 It's been a lot more tame, I think than people expected, 0:16:44.160 --> 0:16:47.280 certainly far far short of nineteen sixty eight. There are 0:16:47.320 --> 0:16:50.080 certainly people who are protesting, people who are making their 0:16:50.160 --> 0:16:53.800 voices heard, but it has really not filtered into the 0:16:54.040 --> 0:16:56.960 events inside the arena or even really near the arena. 0:16:57.000 --> 0:17:00.560 They're about a half a mile away and walked around 0:17:00.680 --> 0:17:03.360 in kind of where all the main events are. You're 0:17:03.400 --> 0:17:04.480 not really aware of. 0:17:04.440 --> 0:17:08.600 Them, Jonathan, Between now and election day? Is it just 0:17:08.800 --> 0:17:12.440 all about the swing states? Is that where we've come 0:17:12.480 --> 0:17:14.280 to pretty much? 0:17:14.320 --> 0:17:16.360 Pretty much, these elections are gonna come down to six 0:17:16.440 --> 0:17:19.919 or seven states, you know, ten twenty thousand, you know, 0:17:20.160 --> 0:17:23.359 tens of thousands of votes in those seven states or so. 0:17:23.520 --> 0:17:25.639 And so if you live in those states, you know, 0:17:25.720 --> 0:17:28.680 expect a mirage of visits and television ads, and if 0:17:28.680 --> 0:17:31.639 you don't, you know, maybe they'll come through for a fundraiser, 0:17:31.680 --> 0:17:33.560 but you're not going to see a lot of the 0:17:33.600 --> 0:17:34.560 candidates directly. 0:17:35.240 --> 0:17:38.119 Now, you're a Congress supporter, right, So I guess my 0:17:38.240 --> 0:17:41.240 question also becomes regardless of who wins the White House, 0:17:41.440 --> 0:17:43.320 what are we looking at in terms of the makeup 0:17:43.840 --> 0:17:44.520 of Congress. 0:17:45.400 --> 0:17:48.800 So it's going to be closely divided either way. There's 0:17:48.840 --> 0:17:51.239 almost no scenario where one party's going to have like 0:17:51.520 --> 0:17:55.199 a major supermajority in either chamber. The Senate is a 0:17:55.240 --> 0:17:59.200 really tough climb for Democrats. The map just favors Republicans. 0:17:59.280 --> 0:18:02.520 Democrats would be we have to win every tough race 0:18:02.720 --> 0:18:06.520 in order to keep control there. But they say they're optimistic, 0:18:06.560 --> 0:18:08.560 but it's a tough clot in the House is a 0:18:08.560 --> 0:18:11.760 little bit different. Democrats more optimistic there. A lot of 0:18:11.760 --> 0:18:15.400 the key races are in New York and California, which 0:18:15.400 --> 0:18:18.680 obviously are blue states. On a presidential level, they're hoping 0:18:18.720 --> 0:18:21.280 that a big presidential win in those states will get 0:18:21.320 --> 0:18:23.880 them the seats they need to take the majority, but 0:18:24.000 --> 0:18:26.919 like Republicans, they'll probably end up with a pretty small 0:18:26.960 --> 0:18:28.040 majority if they do. 0:18:29.440 --> 0:18:32.960 Vice presidential nominee Tim Walls, how did he do last night? 0:18:33.400 --> 0:18:33.880 Do you think? 0:18:34.960 --> 0:18:35.120 Well? 0:18:35.160 --> 0:18:38.119 I think he was an interesting contrast, not necessarily in 0:18:38.240 --> 0:18:42.440 policy to Kamala Harris, but in personality type where she's 0:18:42.800 --> 0:18:45.760 the kind of hard driving lawyer from the coast, kind 0:18:45.800 --> 0:18:49.480 of a type a personality I think we could all agree. Walls, 0:18:49.600 --> 0:18:52.560 is that more kind of Midwestern dad guy talking about 0:18:52.560 --> 0:18:56.439 coaching football, having his former players and students coming up 0:18:56.440 --> 0:18:58.879 on stage with him. I think he gives more of 0:18:59.160 --> 0:19:01.720 a different And I talked to a delegate here from 0:19:01.800 --> 0:19:05.080 Iowa and she said, yeah, like he just represents the 0:19:05.119 --> 0:19:07.880 middle of the country much more than Harris or even 0:19:07.920 --> 0:19:10.960 some of the other Democratic contenders for vice president. 0:19:10.520 --> 0:19:13.080 Would have when do you think we get more policy? 0:19:13.160 --> 0:19:13.320 Right? 0:19:13.359 --> 0:19:15.960 So today's going to be the end of the theatrical event. 0:19:16.400 --> 0:19:20.960 It's going to be about inspiration, etc. Future change two 0:19:21.000 --> 0:19:22.600 point zero. I guess if you could put it like that, 0:19:22.680 --> 0:19:24.200 when do we get actual policy? 0:19:25.119 --> 0:19:26.600 I don't know how much we're going to get, To 0:19:26.640 --> 0:19:30.280 be honest with you, I think that candidates have realized 0:19:30.320 --> 0:19:33.560 that elections are much more decided on feeling and gut 0:19:33.680 --> 0:19:36.399 and vibes and kind of who do you relate to 0:19:36.520 --> 0:19:39.760 on a personal level more than voters looking at, you know, 0:19:39.800 --> 0:19:43.240 writing down all their policies and checking boxes about who 0:19:43.280 --> 0:19:46.199 fits which policy for them. I think voters tend to 0:19:46.320 --> 0:19:50.040 pick the candidate they like and then suit their policies 0:19:50.040 --> 0:19:52.560 to fit with that candidate is offering. So I don't 0:19:52.560 --> 0:19:55.359 think either party sees a huge upside and going deep 0:19:55.400 --> 0:19:58.880 on policy. It brings a tax, and I don't think 0:19:58.920 --> 0:20:02.000 it actually attracts that any voters, which I think is unfortunate. 0:20:02.240 --> 0:20:04.200 We should know what these folks are planning to do, 0:20:04.440 --> 0:20:06.399 but I think politically they're not going to offer a 0:20:06.440 --> 0:20:06.920 whole lot. 0:20:07.960 --> 0:20:11.520 Jonathan. When you talk to folks in Chicago, how do 0:20:11.640 --> 0:20:16.159 they expect former President Trump will conduct the campaign between 0:20:16.200 --> 0:20:18.160 now and election day. 0:20:18.480 --> 0:20:23.040 Well, it depends who you talk to. Republicans want him 0:20:23.080 --> 0:20:25.840 to focus on policy. They want him to say, look 0:20:25.880 --> 0:20:28.679 at all the liberal positions Kamala Harris took, especially when 0:20:28.760 --> 0:20:31.679 she ran for president in twenty twenty, and some of 0:20:31.720 --> 0:20:34.280 the things she said about Medicare and the Green New 0:20:34.320 --> 0:20:38.080 Deal in policing that they think are very unpopular. Still, 0:20:39.040 --> 0:20:42.640 Trump himself has focused more on personal attacks, questioning her 0:20:42.880 --> 0:20:48.000