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Speaker 1: Welcome to the Bloomberg P and L Podcast. I'm PIM Fox.

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Speaker 1: Along with my co host Lisa A. Bramowitz. Each day

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Speaker 1: we bring you the most important, noteworthy, and useful interviews

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Speaker 1: for you and your money, whether you're at the grocery

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Speaker 1: store or the trading floor. Find the Bloomberg P M

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Speaker 1: L Podcast on Apple Podcasts, SoundCloud, and Bloomberg dot Com.

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Speaker 1: Trade Wars with China? Does anybody win? Let's find out from.

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Speaker 1: David Kotaki is the chairman of the chief executive, chief

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Speaker 1: Investment Officer of Cumberland Advisors. They are based in Sarasota, Florida,

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Speaker 1: but David is joining us here in our eleven three

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Speaker 1: oh studios in New York. He's also the co author

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Speaker 1: of the book Adventures in Muni Land. All right, David Kotalk,

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Speaker 1: thank you for being here. Have an Adventures in trade

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Speaker 1: war Land. Does anybody come out a winner? Oh? My gosh. No,

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Speaker 1: It's a relative lost game, and it is a different

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Speaker 1: kind of a game. PIM. We spent the last thirty

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Speaker 1: years in monetary credit banking Federal Reserve Central Banks. We

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Speaker 1: dealt with linear type programs revert to the mean predictability,

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Speaker 1: numerous e nu mercy. This is a shock business. We're

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Speaker 1: not used to this. We've got market agents who haven't

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Speaker 1: had to deal with these kinds of shocks for thirty

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Speaker 1: or forty years. Now. You look around the street, half

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Speaker 1: of them weren't born the last time we had something

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Speaker 1: like this. This is a big deal, and it's not good.

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Speaker 1: If this is such a big deal, why is the

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Speaker 1: SMP five trading at such elevated levels. Try to make

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Speaker 1: that statement with six stocks removed. Defang the fang and

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Speaker 1: we can see what happens with Facebook when you defang

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Speaker 1: a tooth. Defang the fang and look at what the

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Speaker 1: market has been doing. Look at the breath shrinking, new

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Speaker 1: highlist shrinking. My view, personal opinion, that's why we've got you. Okay.

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Speaker 1: The economy peaked in the second quarter of this year

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Speaker 1: with the four percent growth rate. If you had to

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Speaker 1: pick a month, it probably was April or May, because

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Speaker 1: that was the time when you had trade bluster rhetoric,

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Speaker 1: but you didn't have actual. Now we have actual. You

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Speaker 1: open up the Wall Street Journal editorial today and what

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Speaker 1: do you see the list of the growing bureaucracy. You

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Speaker 1: see companies begging for relief and being denied. What else

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Speaker 1: do you see? You go to Maine. I just came

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Speaker 1: back from mere lobster men, family businesses, little business, a

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Speaker 1: few million in revenue, six eight employees are in a

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Speaker 1: lobster trade war with retaliator tariffs. Some of them are saying,

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Speaker 1: we're gonna lose a third of our revenue. We're gonna

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Speaker 1: lay off people. The banks that lend to them. We're saying,

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Speaker 1: come in here, let's talk about what we got to

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Speaker 1: do with your loans. This is an ugly anecdote by anecdote,

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Speaker 1: shock by shock, and we're only seeing the beginning. If

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Speaker 1: we're only seeing the beginning, and the stock market is

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Speaker 1: supposed to be a forward looking mechanism, why our investors

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Speaker 1: not looking at those lobstermen in Maine, the cranberry growers

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Speaker 1: in Massachusetts, and the steelmakers like well al CoA aluminum

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Speaker 1: they wanted an exemption on some of those import tariffs

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Speaker 1: because they wanted to import aluminum that came from their

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Speaker 1: own operations overseas. Well, Why does the stock market do

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Speaker 1: what it does? We had a conversation were buyers themselves,

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Speaker 1: Well there you go, so I I said, remember new

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Speaker 1: fed chair, green Span worried about currency, exchange rates, raises,

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Speaker 1: interest rates, market keeps going up, hits a wall in August,

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Speaker 1: and two months later it's down and we've had a

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Speaker 1: bear market that has been devastating. Why did the stock

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Speaker 1: market then go up in June to go down in September.

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Speaker 1: I don't know what the stock market's gonna I'll tell

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Speaker 1: you what we did in our portfolios. Tell us cash reserves.

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Speaker 1: We have them domestic focus. Depends on the portfolios, can

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Speaker 1: be as high as a third, as low as ten

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Speaker 1: fifteen percent, depends on the structure. But US Focus has

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Speaker 1: a cash reserved. Now, what do you do with the rest?

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Speaker 1: Domestic small mid cap focus locally reduce exposure to the

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Speaker 1: international breuhaha, and hope, by the way, you can restore

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Speaker 1: it because they're going to have a settlement and not

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Speaker 1: a long term trade war, and we don't know which

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Speaker 1: it's going to be now. I confess every time I

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Speaker 1: hear the word hope, when I hear about money, it's

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Speaker 1: not a It makes me worried a little a little bit.

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Speaker 1: You're you talked about the cash portfolio right ten on

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Speaker 1: the downs on the low side, and maybe third for

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Speaker 1: some other and it depends and that's temporary. It's transitional,

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Speaker 1: but it may be there for a while. What do

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Speaker 1: you sell in order to raise that kind of capital?

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Speaker 1: What we reduced the tech? Wait? We fortunately we came

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Speaker 1: out of the E t f s that were heavy

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Speaker 1: before Facebook blew up, and that kind of gave us

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Speaker 1: a little gift we didn't know. Take your profits, pay

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Speaker 1: your taxes, and be happy. You bet you. You know

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Speaker 1: what my grandfather taught me when I was a little boy.

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Speaker 1: If you make a profit, say thank you, and you

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Speaker 1: don't have to make the whole profit. And if you

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Speaker 1: pay the tax, say thank you because the rest of

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Speaker 1: it is in your pocket. Given that advice from your

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Speaker 1: and father, do you believe that investors are ignoring the

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Speaker 1: fundamental geopolitical situation in favor of Oh, corporate earnings are

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Speaker 1: going to continue to produce these incredible results. Well, I

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Speaker 1: think you hit it right on the head, Right on

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Speaker 1: the head. We've had great earnings. We've got another round

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Speaker 1: reporting off the second quarter of earnings. They're good. Most

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Speaker 1: companies beat expectations, pretty good result. We've had a good quarter. Now,

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Speaker 1: did we have a good quarter? And is this a

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Speaker 1: continuation of a trend? Maybe I don't think so. Did

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Speaker 1: we accelerate business into the second quarter? Did we borrow

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Speaker 1: from the future because of the trade effects? Do we

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Speaker 1: not see the dislocations from the trade effects yet? Are

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Speaker 1: they coming? Do they affect credit? Do we get some

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Speaker 1: inflation from it? Do we get growth slow down? All

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Speaker 1: those things line up. That's not healthy for continuing earnings

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Speaker 1: being robust. Let's say a client calls and three months

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Speaker 1: have gone by, stocks have still increased in value. Does

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Speaker 1: David Kotok say, Look, just because you didn't make the

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Speaker 1: last three months doesn't mean that what's coming is going

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Speaker 1: to get better. Yeah. I mean you say it, they

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Speaker 1: don't want to hear it. I And just that's my point.

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Speaker 1: How do you educate people? How do people take that?

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Speaker 1: Because you know that what happens, people spend a lot

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Speaker 1: of time looking at the downside, and they just complain

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Speaker 1: about not making at all. PIM we had a great run,

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Speaker 1: a great market. No one gets of the market. We

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Speaker 1: know that. We've talked about that over the years. So

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Speaker 1: you say, Okay, it's okay to put a little dry

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Speaker 1: powder in the bank. You don't have to sell everything,

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Speaker 1: but you have to put dry powder in the bank.

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Speaker 1: And there are times when you have to admit and

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Speaker 1: I'm in minting it. We don't know. We haven't had

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Speaker 1: the kinds of issues on the plate driven by politics

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Speaker 1: where a trade policy is driven by a man named

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Speaker 1: Peter Navarro who promised there'll be no retaliation. Remember who

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Speaker 1: promised we won't have any of these effects? Set it

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Speaker 1: looking into the camera and he's got the president's here,

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Speaker 1: and who knows who's got the president's here on the

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Speaker 1: latest tweet. This bizarre leadership and the country still permits it.

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Speaker 1: Thank you very much. David Kotak, Chairman, Chief investment officer,

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Speaker 1: Cumberland Advisers, based in Sarasota, Florida. President Donald Trump has

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Speaker 1: warned countries against doing big business with Iran as sanctions

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Speaker 1: kicked back. In To tell us more about the implications

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Speaker 1: for world oil markets is Dr Ellen Wall, President of

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Speaker 1: Transversal Consulting and an expert on energy and Middle East politics.

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Speaker 1: Dr Wall, thank you very much for being with us.

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Speaker 1: Can you explain what effect the sanctions will have on

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Speaker 1: Iran's oil industry? Right now? The sanctions that are being

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Speaker 1: implemented are on purchases of US dollars, purchases of gold,

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Speaker 1: and also particularly the automobile industry. And that means that

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Speaker 1: any person or institutions that's helping the government of Iran

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Speaker 1: to purchase US currency would be subject to sanctions, and

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Speaker 1: that impacts the oil industry because most oil transactions are

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Speaker 1: done in dollars. Now, for quite some time now, a

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Speaker 1: lot of Iran's transactions have actually not been occurring in dollars.

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Speaker 1: They've been using duros and also some local currencies. So

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Speaker 1: right now we're not looking to see a whole lot

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Speaker 1: of impact on the Iranian oil industry aside from what

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Speaker 1: we've already seen. But what we do need to look

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Speaker 1: at is the sanctions that are coming into effect on

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Speaker 1: November five, and those who are actually clarified in this

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Speaker 1: most recent executive order, and that will be sanctions against

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Speaker 1: anyone or any institution that assists, sponsors, or provides goods

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Speaker 1: or services in support of the National Iranian Oil Company.

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Speaker 1: And so everyone who is right now engaged in doing

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Speaker 1: business with Iran in terms of oil is going to

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Speaker 1: be watching how the US implements this round of sanctions

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Speaker 1: to see and to make their plans in advance of

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Speaker 1: November five. Okay, let's see if we can describe two

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Speaker 1: different scenarios, one having to do with the Iran's domestic economy.

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Speaker 1: Do they have refining capacity? They do, it's not great.

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Speaker 1: Part of the issue during the first round of sanctions,

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Speaker 1: the earlier ones before the j c p o A

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Speaker 1: was that they were unable to get parts and supplies

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Speaker 1: and things and infrastructure parts needed to um fix their

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Speaker 1: declining refineries and to put in more refining capacity. Apparently

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Speaker 1: they have made strides in producing some of these things domestically,

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Speaker 1: but they're not yet ready, so it will affect Iran's

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Speaker 1: domestic refining capacity, which will have an impact on the

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Speaker 1: Iranian economy. Okay, the second part is to which country

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Speaker 1: does Iran export the most oil? Is it South Korea?

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Speaker 1: Is it China? Right now, it's China. They are the

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Speaker 1: number one purchaser of Iranian oil. And what will the

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Speaker 1: sanctions do to Chinese oil imports? Well, that is the

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Speaker 1: big question that we're all looking to see what happens

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Speaker 1: right now. China has said it has no intention regardless

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Speaker 1: of these sanctions of decree seeing it's Iranian oil imports. However,

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Speaker 1: it has said it's not planning on increasing them, which

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Speaker 1: is actually a pretty big signal that it's um that

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Speaker 1: it is taking these sanctions somewhat seriously. The big question

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Speaker 1: is how is it going to import that oil? Is

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Speaker 1: it simply going to just ignore the sanctions? Will it

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Speaker 1: have to pass most of its funds and things through

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Speaker 1: uh the There's one particular bank in China that they

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Speaker 1: use last time that doesn't really do business with American interests,

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Speaker 1: and so they can use that bank to take care

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Speaker 1: of those financial transactions. The problem is that with the

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Speaker 1: amount of oil that China is importing from Iran these days,

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Speaker 1: they that bank may not be able to handle all

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Speaker 1: those transactions and we may see an involuntary decline from China. Now,

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Speaker 1: there has been a report that the total export volume

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Speaker 1: on various types of oil carrying ship to afromax Is,

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Speaker 1: Suez max Is and those very large crude carriers, that

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Speaker 1: the exports from Iranian ports have fallen about seven percent

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Speaker 1: in July. Do you agree with that? Yes, And we

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Speaker 1: are seeing that particularly India has their refineries in India,

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Speaker 1: not the state owned ones, but some of the other

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Speaker 1: ones like Naraya, which is owned by Rosneft, have been

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Speaker 1: cutting their imports of Iranian oil. So that does match

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Speaker 1: with what we're seeing also South Korea has been looking

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Speaker 1: at South Korea imports a lot of Iranian condensate, and

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Speaker 1: they've been looking at other options, including light oil from

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Speaker 1: create and oil from condensate from the United States. All Right,

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Speaker 1: some other customers include Japan. What do you believe the

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Speaker 1: Japanese refiners will do. I do think that when when

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Speaker 1: it comes down to it, the Japanese refiners will not

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Speaker 1: continue to purchase Iranian oil um if they do not

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Speaker 1: receive a waiver from the us UH. It seems right

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Speaker 1: now it's unlikely they're going to get a waiver. They've

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Speaker 1: asked for one. The State Department has been asked about

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Speaker 1: the status of that. They've decided they they're not commenting

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Speaker 1: on these case by case situations. But given the language

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Speaker 1: and the stances that we've seen coming from the Trump administration,

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Speaker 1: it does not seem likely that Japan will get a

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Speaker 1: waiver for to continue to purchase Iranian oil. Explain what

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Speaker 1: is Turkey's relationship to Iranian oil. Turkey is a is

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Speaker 1: a fairly large importer of Iranian oil right now, and

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Speaker 1: Turkey in the United States are not on good terms

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Speaker 1: at this moment, and so Turkey has said they're going

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Speaker 1: to continue to purchase this Iranian oil. Now the question

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Speaker 1: again is how, because how are they going to ensure

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Speaker 1: the tankers full of Iranian oil? How are they going

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Speaker 1: to purchase that oil. We may see them have to

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Speaker 1: decrease their um legitimate purchases, but we may see an

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Speaker 1: increase in um smuggling or in the illegitimate purchases of

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Speaker 1: Rainy oil. Iran and Turkey share a border. Now there's

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Speaker 1: no pipeline that connects Iran and Turkey because it was

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Speaker 1: blown up by the curds, but we could see some

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Speaker 1: trucking going on there, Thank you very much. Dr ellen

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Speaker 1: Wald is the president of Transversal Consulting and also a

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Speaker 1: non resident Senior Fellow at the Atlantic Council's Global Energy Center.

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Speaker 1: We consult with Damian Sassare are fixed income strategist for

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Speaker 1: Bloomberg Intelligence when we want to know anything about what's

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Speaker 1: going on in the world of emerging markets, and Damien,

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Speaker 1: good to have you with us. Is Turkey an emerging

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Speaker 1: market or is it a cratering market at this point? Yeah?

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Speaker 1: I know you. I mean, now the comparisons is really

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Speaker 1: only one comparison to make, and you just made its Venezuela.

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Speaker 1: You know, if you look at local currency tenure yields,

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Speaker 1: if you look at their their dollar equivalent yield, if

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Speaker 1: you look at the performance of their currency and their

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Speaker 1: equity markets, Venezuela is really the only one you can

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Speaker 1: even make comparison to, in fact, but the thing that

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Speaker 1: big difference is Venezuela has oil. Turkey doesn't have oil.

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Speaker 1: It just seems to have a problem. What is going first,

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Speaker 1: one don't just set out what are the issues that

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Speaker 1: Turkey faces and what are the potential solutions if any. Right, Well,

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Speaker 1: I mean Turkey's fiscal priorities are not aligned with the

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Speaker 1: country's sovereign balance sheet, right, I mean they have um,

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Speaker 1: They've extracted a ton of funding from the West, from

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Speaker 1: the US, from Europe, yet President Urdwin's pivoted away from them. Um.

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Speaker 1: And that's really at the root of this. And so

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Speaker 1: the market effectively has lost pretty much all confidence in

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Speaker 1: the central Bank and it's polity mechanisms that are in place,

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Speaker 1: such as interest rates and so forth, to um to

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Speaker 1: to to basically arrest the decline in UH in the

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Speaker 1: country's you know, asset base and so right now, so

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Speaker 1: far as I can tell, it looks like capital controls

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Speaker 1: appear inevitable and and that's never a good thing for

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Speaker 1: an emerging market, especially one were inflations running at sixteen

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Speaker 1: per year. The current account deficits over six percent now

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Speaker 1: UM it's external debtload is upwards of total debt um

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Speaker 1: p M I felt to its lowest level in May,

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Speaker 1: although it's recovered a bit. I mean, we're just, uh,

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Speaker 1: it's a bad situation. And so you know, from where

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Speaker 1: we sit, you know, there's a few other things that

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Speaker 1: kind of come to mind. And the first thing that

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Speaker 1: might help mitigate the issue is if if if President

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Speaker 1: Urdwin and Turkey were to re engage with the US,

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Speaker 1: because right now we're having some diplomatic issues and I'll

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Speaker 1: just kind of run you through them. Um. You know,

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Speaker 1: Turkey's refused to release UM Pastor Andrew Brunson, also a

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Speaker 1: NASA scientist, UM, who's who's been locked up since sixteen. UM.

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Speaker 1: We have a halk Bank, one of the largest banks

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Speaker 1: in Turkey, that helped a random ad U S sanctions

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Speaker 1: on oil some time ago. And we had Turkey decision

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Speaker 1: to recently purchase a missile system from Russia, really turning

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Speaker 1: their backs on NATO. So that's from the U S side.

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Speaker 1: From the Turkish side, You've got you know, um, Turkey

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Speaker 1: looking for the US to extradite Fatula Gulan, which is

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Speaker 1: an Islamic cleric whom is a former ally of Urdwin

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Speaker 1: who he blames for the kup In. And you have

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Speaker 1: the US arming Kurdish forces um uh, you know, basically

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Speaker 1: against Isis um. But you know basically that is Dwin

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Speaker 1: views the Kurds as as terrorists. So so you have

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Speaker 1: these diplomatic divides, and it's really just weighing on the

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Speaker 1: economy and the people of Turkey, and you know, something

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Speaker 1: needs to be done in order for for for US

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Speaker 1: to arrest it the clients. So let's let me see

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Speaker 1: I can get this. They have debts they cannot repay,

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Speaker 1: they have a currency that is dwindling in value, and

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Speaker 1: there is radio silence from the government. Yeah, that's exactly right.

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Speaker 1: And so we do have a delegation of Turkish officials

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Speaker 1: supposedly coming to Washington in the next two days, and

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Speaker 1: one would hope that would be the beginning of a

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Speaker 1: appeal to the I m F, perhaps for a line

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Speaker 1: of credit or alone or something of that nature to

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Speaker 1: sort of give some confidence to to their existing creditors

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Speaker 1: that hey, maybe there's gonna be Would the United Banks

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Speaker 1: have to approve any disbursement from the International Monetary Fund

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Speaker 1: to help Turkey? One would think the U S would

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Speaker 1: be heavily involved in those negotiations. Absolutely. Um, you would

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Speaker 1: think that perhaps there would be an appeal to the

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Speaker 1: White House and to President Trump's administration in that type

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Speaker 1: of a scenario. But you know, right now, um, it's

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Speaker 1: anyone's guess if they're even gonna make it here. And

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Speaker 1: so you know that is kind of where we are.

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Speaker 1: I mean, it's just, um, you know, it's been radio

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Speaker 1: silence quite frankly from urdle Win from the Central Bank

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Speaker 1: of the Republic of Turkey, right, and and that that

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Speaker 1: radio silence is giving a lot of people room for pause.

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Speaker 1: Let's just assume that you get a blank slate and

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Speaker 1: they called Damien Sassaur and say, all right, give us

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Speaker 1: three things that we ought to do by the end

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Speaker 1: of the week to start to put this on a

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Speaker 1: more reliable and sustainable recovery. Yeah, there are the three

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Speaker 1: things that I would do. Is I'd read anything and

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Speaker 1: everything I can to reinstall central bank confidence that's the most.

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Speaker 1: I don't think you can even I don't think it's

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Speaker 1: the level of interest rates. I think it's just about

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Speaker 1: the central banks independence, which, as we've discussed here on

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Speaker 1: this show before, has been called into question now that

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Speaker 1: Irwin's put his son in law at the head of

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Speaker 1: the finance ministry. Basically he's controlling the economy, or maybe

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Speaker 1: put someone else in charge of the central banks. We

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Speaker 1: need independence. That's the first order business. The second would

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Speaker 1: be they need to tighten fiscal spending. They need to

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Speaker 1: take structural forms. They have a lot of debt, they

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Speaker 1: need to stop spending money, stop spending money exactly. And

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Speaker 1: the third would be, yeah, I think they need to

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Speaker 1: go and appeal to the I m F. They need

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Speaker 1: to secure some sort of backup facility in place to

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Speaker 1: help arrest uh an idea how much? Um, I have

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Speaker 1: no idea how much? And I have no idea. Well,

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Speaker 1: I don't know if it's so much. The number again,

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Speaker 1: it's just the confidence that hey, they're now appealing to

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Speaker 1: multi lateral institutions for for assistance, and they realize that

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Speaker 1: their economy is in a bad way and they need

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Speaker 1: to do something about it. And you know, look we like,

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Speaker 1: I mean, like most most investors in emerging market debt

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Speaker 1: will they like I m F backed sovereigns, so you know,

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Speaker 1: we would like to see that happen as well. Thank

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Speaker 1: you very much. Damian Sassauer as always expert when it

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Speaker 1: comes to emerging markets. He's our fixed income strategist for

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Speaker 1: Bloomberg Intelligence. Talking about Turkey and it's a dire economic situation.

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Speaker 1: Let's turn our attention to the connection between wildfires in

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Speaker 1: California and the utilities in California. Here to tell us

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Speaker 1: all about it is Kit Ki is our senior Industrials

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Speaker 1: and utilities analysts for Bloomberg Intelligence. Kit thank you very

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Speaker 1: much for joining me. Maybe just explain to people that

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Speaker 1: it is not just the current wildfires that have been

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Speaker 1: affecting companies like Pacific Gas and Electric PGNI. This is

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Speaker 1: something that has lingered from last year's wildfire season and

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Speaker 1: it is continuing unfortunately this year. Absolutely right. Last year,

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Speaker 1: there was an estimate of up to fifteen billion dollars

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Speaker 1: in liabilities that p g n E ran up, and

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Speaker 1: maybe three or four billion that Edison International in the

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Speaker 1: South has pending. Nobody knows for sure what those numbers

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Speaker 1: are like because all the lawsuits have not been filed

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Speaker 1: and they're going to take a long time. But the

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Speaker 1: you know, given the track record so far, uh, and

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Speaker 1: given the likelihood the courts are sympathetic to victims. Uh, big,

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Speaker 1: big potential problems already in the books for pen and Edison,

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Speaker 1: and of course what's going on now and what might

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Speaker 1: go on next year. This had to do with a

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Speaker 1: signing blame or responsibility for some of the fires. But

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Speaker 1: there's also an issue having to do with laws regulations

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Speaker 1: in the state of California. Yeah, exactly. The utilities and

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Speaker 1: investors feel like they're falling in the cracks here that

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Speaker 1: there's a doctrine in California, mainly in California that the

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Speaker 1: courts of upheld called inverse condemnation, which holds that a

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Speaker 1: utility is gonna have to pay for any damages anybody

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Speaker 1: suffers if the utility is even slightly involved, regardless of

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Speaker 1: their fault. So the idea, uh, you know, broadly was

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Speaker 1: somebody picks up the tab first and then you go

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Speaker 1: and assign blame. Well, you know, by the time they

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Speaker 1: get around to assigning it, investors are legitimately afraid that

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Speaker 1: nobody's going to give the money back to the utilities,

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Speaker 1: and that's the huge threat there is that the utilities

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Speaker 1: have these multibillion dollar liabilities just lingering and eventually having

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Speaker 1: to be paid. We know that PGNI currently pays no dividend.

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Speaker 1: Correct they've been trying to conserve cash. What's the likelihood

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Speaker 1: that pen has to seek bankruptcy protection. I view it

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Speaker 1: as a strategic threat at this point. I don't think

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Speaker 1: that they're in my view that they, uh you know,

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Speaker 1: are an imminent cash danger the way they were in

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Speaker 1: the energy crisis in oh one, for example, because a

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Speaker 1: lot of these decisions about liabilities haven't been made yet. However,

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Speaker 1: they are gonna happen in the future, and I think

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Speaker 1: uh p GNY correctly is telling people we're gonna go

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Speaker 1: bankrupt if this continues someday, and it's up to us

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Speaker 1: when we file. And they're trying to make the state

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Speaker 1: legislature make some decisions about protecting us from catastrophic losses

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Speaker 1: that make no sense because you need a utility that

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Speaker 1: can operate financially. P GENS shares have lost about forty

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Speaker 1: of their value usince October of last year. Does that

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Speaker 1: figure into the back and forth between PG and E

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Speaker 1: and state regulators. Are they able to kind of use

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Speaker 1: that as a backdrop and say, look, this is what's happening.

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Speaker 1: And as you just said, they do need a public utility.

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Speaker 1: There's no question that the utility managers and investors go

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Speaker 1: to the public authorities and say, we're we've taken our heads.

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Speaker 1: You know, it's not all our fault. Even even in

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Speaker 1: the findings by the fire authorities. Yeah, we have some blame,

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Speaker 1: but other people have other blame, and some of it

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Speaker 1: is just fire start and they burn and it's not

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Speaker 1: you know, because we have wires around doesn't mean it

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Speaker 1: was our fault. Um. But at any rate, we can't

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Speaker 1: go bankrupt. It makes no sense. Don't force us into

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Speaker 1: that position. And we've done what we can by cutting

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Speaker 1: our dividend out completely. Give you about twenty seconds. What

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Speaker 1: is next? What should we look forward? We have two

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Speaker 1: things going on. One the big event should be by

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Speaker 1: the end of August. The legislature in California will have

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Speaker 1: to make a decision on whether they get rid of

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Speaker 1: inverse condemnation somewhere or not, and that could play into

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Speaker 1: PGNI deciding about bankruptcy. The other is in the near term,

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Speaker 1: the biggest fire from last year, the Tubs Fire, has

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Speaker 1: a decision to be made by the cal Fire Authority,

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Speaker 1: the firefighting agency that puts out a report. Thanks very much.

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Speaker 1: Kit Connoledge is our senior Industrials and Utilities analyst for

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Speaker 1: Bloomberg Intelligence. Knows all about the business and always appreciate

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Speaker 1: your stopping by and enlightening us. Much appreciated. Thanks for

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Speaker 1: listening to the Bloomberg P and L podcast. You can

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Speaker 1: subscribe and listen to interviews at Apple Podcasts, SoundCloud, or

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Speaker 1: whatever podcast platform you prefer. I'm pim Fox. I'm on

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Speaker 1: Twitter at and Fox. I'm on Twitter at Lisa Abramo

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Speaker 1: wits one. Before the podcast, you can always catch us

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Speaker 1: worldwide on Bloomberg Radio.