1 00:00:00,160 --> 00:00:02,639 Speaker 1: I've been checking with the work opinion to join by Bloomber. 2 00:00:02,759 --> 00:00:08,119 Speaker 1: Welcome to the Bloomberg Piano Podcast. Each day we bring 3 00:00:08,160 --> 00:00:11,719 Speaker 1: you must noteworthy for you and your money, whether at 4 00:00:11,720 --> 00:00:16,000 Speaker 1: the Social Store or the Bloomberg Podcast, on a couple podcasts, 5 00:00:16,160 --> 00:00:20,439 Speaker 1: or wherever you listen to podcasts. Two point part issue. 6 00:00:20,520 --> 00:00:22,160 Speaker 1: So on the one hand, I mean, I think it's 7 00:00:22,200 --> 00:00:25,000 Speaker 1: worth remembering that, you know, these terrorists that were put 8 00:00:25,160 --> 00:00:28,920 Speaker 1: in place did affect medical goods that we shipped over 9 00:00:29,080 --> 00:00:33,239 Speaker 1: from China. So this includes face masks, hand sanitizer, protective 10 00:00:33,280 --> 00:00:36,040 Speaker 1: gear that is now very much in demand. And the 11 00:00:36,080 --> 00:00:39,960 Speaker 1: Trump administration did you know, offer exemptions for those products, 12 00:00:40,000 --> 00:00:42,240 Speaker 1: but they took that very recently ago, as then you know, 13 00:00:42,360 --> 00:00:44,960 Speaker 1: one to two weeks ago, and at that point, you know, 14 00:00:45,200 --> 00:00:47,919 Speaker 1: some of the damage is already done. I mean, we've 15 00:00:47,960 --> 00:00:51,120 Speaker 1: already then shifted the flow of goods now to places 16 00:00:51,200 --> 00:00:53,400 Speaker 1: like Europe, which of course are battling their own issues 17 00:00:53,440 --> 00:00:55,640 Speaker 1: with the coronavirus and may in the future be less 18 00:00:55,640 --> 00:00:58,640 Speaker 1: willing to export some of those products to US UM 19 00:00:58,800 --> 00:01:01,280 Speaker 1: And then you know, it's also an issue of whether 20 00:01:01,440 --> 00:01:04,800 Speaker 1: or not you know or necessarily the the customer of 21 00:01:04,880 --> 00:01:09,120 Speaker 1: first choice for um Chinese suppliers. You know, the Peterson 22 00:01:09,160 --> 00:01:11,280 Speaker 1: Institute did a really great piece on this, just looking 23 00:01:11,360 --> 00:01:13,840 Speaker 1: at the ways in which it changes incentives when you 24 00:01:13,959 --> 00:01:16,160 Speaker 1: do have those tarrifts in place. So that certainly is 25 00:01:16,200 --> 00:01:18,320 Speaker 1: not helpful. But I think about it also, you know, 26 00:01:18,400 --> 00:01:20,640 Speaker 1: the second part of this is just in a broader sense, 27 00:01:21,400 --> 00:01:24,400 Speaker 1: manufacturers are getting hit really hard by this, whether that's 28 00:01:24,440 --> 00:01:26,400 Speaker 1: just you know, a total drop off in demand or 29 00:01:26,440 --> 00:01:28,800 Speaker 1: a disruption of their supply chain, and the terrorists just 30 00:01:28,880 --> 00:01:32,640 Speaker 1: seem like an extra tax that makes this harder on them. 31 00:01:32,720 --> 00:01:35,480 Speaker 1: It just seems unnecessary. And that's particularly true at a 32 00:01:35,600 --> 00:01:38,040 Speaker 1: time when we're really starting to see an emphasis on 33 00:01:38,520 --> 00:01:41,280 Speaker 1: calling the manufacturers to step up and use their idol 34 00:01:41,360 --> 00:01:44,720 Speaker 1: factories to make products like masks and ventilators helps to 35 00:01:44,800 --> 00:01:47,800 Speaker 1: still this shortage in America right now. And if they 36 00:01:47,880 --> 00:01:50,280 Speaker 1: do that is the reward then that when we go 37 00:01:50,360 --> 00:01:52,360 Speaker 1: back to normal life, they still have to jump through 38 00:01:52,400 --> 00:01:55,280 Speaker 1: the obstacles of tariffs when they answered their patriotic duty. 39 00:01:55,360 --> 00:01:57,640 Speaker 1: I just I don't know if it makes sense, and 40 00:01:57,720 --> 00:01:59,400 Speaker 1: it strikes me as more of a hindrance when we 41 00:01:59,400 --> 00:02:01,520 Speaker 1: should be spilled a thing on everything that can possibly 42 00:02:01,560 --> 00:02:06,320 Speaker 1: help us in this spite against coronavirus. Brook really interesting 43 00:02:06,640 --> 00:02:09,040 Speaker 1: to take at a time when it's like whack a 44 00:02:09,120 --> 00:02:11,960 Speaker 1: mole with respect the information coming at you every single 45 00:02:12,080 --> 00:02:14,760 Speaker 1: day in terms of which part of the market, which 46 00:02:14,800 --> 00:02:17,440 Speaker 1: part of the economy, which part of the political world, 47 00:02:17,520 --> 00:02:20,280 Speaker 1: which part of the central banking world is in the 48 00:02:20,440 --> 00:02:23,480 Speaker 1: front and in the focus. Amid all of this, we 49 00:02:23,639 --> 00:02:26,919 Speaker 1: haven't talked as much about supply chains, just more broadly, 50 00:02:27,400 --> 00:02:30,600 Speaker 1: and before we get into just what the tariff policy 51 00:02:30,680 --> 00:02:34,600 Speaker 1: should be, how much our supply chains still disrupted from 52 00:02:34,639 --> 00:02:36,920 Speaker 1: what happened in China and what's been going on now 53 00:02:37,000 --> 00:02:39,880 Speaker 1: in in in Europe. I mean, how much are those 54 00:02:39,919 --> 00:02:44,160 Speaker 1: supply chains still intact to begin with? Look, I mean 55 00:02:44,200 --> 00:02:47,720 Speaker 1: I think they were significantly disrupted by what happened in China, 56 00:02:47,880 --> 00:02:50,080 Speaker 1: and you know, at the time that sparked a conversation 57 00:02:50,200 --> 00:02:53,320 Speaker 1: of oh, are we too dependent on China? But then 58 00:02:53,400 --> 00:02:56,239 Speaker 1: as you've seen this virus spread across the world, I 59 00:02:56,320 --> 00:02:58,200 Speaker 1: don't know if it really makes the difference at this 60 00:02:58,280 --> 00:03:00,720 Speaker 1: point where your supply chains are. We're same factory shut 61 00:03:00,760 --> 00:03:03,480 Speaker 1: down in Latin America, factories shut down in the US, 62 00:03:03,520 --> 00:03:06,560 Speaker 1: factory shut down in Europe, and so you know, I 63 00:03:06,800 --> 00:03:09,679 Speaker 1: think as we think about how supply change changed down 64 00:03:09,760 --> 00:03:12,000 Speaker 1: the road. Initially I was thinking of this as more 65 00:03:12,040 --> 00:03:14,440 Speaker 1: of a geographical rethink, but then I think that now 66 00:03:14,560 --> 00:03:17,079 Speaker 1: maybe we pivot to what do these factories look like? 67 00:03:17,360 --> 00:03:20,600 Speaker 1: You know, robots don't get coronavirus? Does this just speed 68 00:03:20,720 --> 00:03:23,040 Speaker 1: the spread of automation? Do we see more and more 69 00:03:23,080 --> 00:03:26,280 Speaker 1: companies relying on additive manufacturing where you don't need to 70 00:03:26,360 --> 00:03:28,840 Speaker 1: get parts from different parts of the world. You can 71 00:03:28,919 --> 00:03:30,959 Speaker 1: just have something come out of a printer and be 72 00:03:31,200 --> 00:03:33,760 Speaker 1: in your factories. So I think those types of conversations 73 00:03:34,080 --> 00:03:36,560 Speaker 1: are maybe now where we're more headed at this point 74 00:03:36,600 --> 00:03:39,200 Speaker 1: in time, because you are seeing amazing disruption to the 75 00:03:39,200 --> 00:03:42,000 Speaker 1: flow of goods um you know, across a broad range 76 00:03:42,040 --> 00:03:43,560 Speaker 1: of products, and I think we're going to have to 77 00:03:43,640 --> 00:03:46,720 Speaker 1: think about how we better safeguard those systems. Well, I 78 00:03:46,800 --> 00:03:48,880 Speaker 1: think the line of the day Lisa is robots don't 79 00:03:48,920 --> 00:03:51,320 Speaker 1: get coronavirus. Yeah, And I kind of malfunctioned a little 80 00:03:51,320 --> 00:03:53,440 Speaker 1: bit earlier when I'm trying to speak, so I think 81 00:03:53,480 --> 00:03:58,480 Speaker 1: I'm safe. So Brooke, just practically speaking, can I auto 82 00:03:58,520 --> 00:04:03,080 Speaker 1: manufacturing plant? Switch were to make ventilators? So there are 83 00:04:03,240 --> 00:04:05,520 Speaker 1: issues with this, So you know the UK is also 84 00:04:05,680 --> 00:04:09,000 Speaker 1: calling on its manufacturers to make ventilators, and the confirm 85 00:04:09,080 --> 00:04:12,560 Speaker 1: there that these are very heavily regulated devices, and we 86 00:04:12,880 --> 00:04:14,680 Speaker 1: don't I think, want to be in the practice of 87 00:04:14,800 --> 00:04:17,320 Speaker 1: vending those rules because obviously we don't want to do 88 00:04:17,400 --> 00:04:19,840 Speaker 1: anything that might make this health crisis actually worse. But 89 00:04:19,960 --> 00:04:23,839 Speaker 1: I do think, you know, companies that have experience making 90 00:04:24,040 --> 00:04:27,640 Speaker 1: heavily regulated equipment UM might be in a better position 91 00:04:27,680 --> 00:04:29,800 Speaker 1: to step up, at least as far as that is concerned. Now, 92 00:04:29,839 --> 00:04:34,359 Speaker 1: I will say, you know, auto factories do require require 93 00:04:34,400 --> 00:04:37,640 Speaker 1: assembly line somewhat similar to ventilators, and there are similarities 94 00:04:37,680 --> 00:04:39,480 Speaker 1: that you think about. You know, the highly advantaged like 95 00:04:39,680 --> 00:04:42,200 Speaker 1: h sex systems that are in those cars, and you 96 00:04:42,279 --> 00:04:44,440 Speaker 1: know the technology that you would need to do a ventilators, 97 00:04:44,480 --> 00:04:47,200 Speaker 1: So there are some similarities there. Also, there are hurdles 98 00:04:47,279 --> 00:04:50,480 Speaker 1: that need to be worked out masks and hand sanitizer 99 00:04:50,560 --> 00:04:52,880 Speaker 1: and protective year that is a lot easier to do. 100 00:04:53,560 --> 00:04:56,080 Speaker 1: You may see more companies stepping up on that front, 101 00:04:56,120 --> 00:04:58,960 Speaker 1: but I do think there is a path to make 102 00:04:59,080 --> 00:05:01,040 Speaker 1: more ventilators. We will have to figure out some of 103 00:05:01,120 --> 00:05:03,280 Speaker 1: the logistics of that, and it's not quite easy as 104 00:05:03,320 --> 00:05:06,080 Speaker 1: just flipping a switch to making a totally different product. 105 00:05:06,279 --> 00:05:08,240 Speaker 1: Brook Sutherland, thank you so much for being with us, 106 00:05:08,240 --> 00:05:12,480 Speaker 1: brook Sutherland, Bloomberg Opinion industrials columnist, joining us to talk 107 00:05:12,680 --> 00:05:15,560 Speaker 1: about the tariff situation rolling them back, but also the 108 00:05:15,600 --> 00:05:18,200 Speaker 1: supply chains. And I do think, Paul, you raise really 109 00:05:18,279 --> 00:05:22,640 Speaker 1: interesting point, which is in a wartime situation, typically, uh, 110 00:05:22,920 --> 00:05:27,680 Speaker 1: the US has mustard all of its capabilities to manufacture 111 00:05:27,760 --> 00:05:30,920 Speaker 1: weapons or manufacture clothing for the troops. And you have 112 00:05:31,000 --> 00:05:34,800 Speaker 1: to wonder if this is being treated as a wartime situation, 113 00:05:34,960 --> 00:05:37,440 Speaker 1: at what point will the factories that are offline to 114 00:05:37,520 --> 00:05:41,479 Speaker 1: make cars be corralled into making ventilators and be making 115 00:05:41,880 --> 00:05:45,120 Speaker 1: masks and purel and toilet paper, because that seems to 116 00:05:45,279 --> 00:05:50,120 Speaker 1: also be a concern for a lot of people. There 117 00:05:50,279 --> 00:05:53,000 Speaker 1: is a question though about the oil patch and how 118 00:05:53,120 --> 00:05:56,440 Speaker 1: much is sort of exacerbated by the fact that Saudi 119 00:05:56,440 --> 00:05:58,680 Speaker 1: Arabia and Russia appear to be in a tiff that 120 00:05:58,720 --> 00:06:01,520 Speaker 1: does not seem to be going away anytime soon, where 121 00:06:01,640 --> 00:06:04,040 Speaker 1: both of them are doubling down on production at a 122 00:06:04,120 --> 00:06:07,640 Speaker 1: time when demand is falling off a cliff to try 123 00:06:07,720 --> 00:06:12,240 Speaker 1: to understand this relationship, what happens if they come to 124 00:06:12,360 --> 00:06:14,720 Speaker 1: some sort of accord and curb production. What will that 125 00:06:14,880 --> 00:06:17,520 Speaker 1: mean for oil? What will that mean for the entire 126 00:06:17,640 --> 00:06:21,640 Speaker 1: relationship of nations in the Middle East and Russia joining 127 00:06:21,760 --> 00:06:25,600 Speaker 1: US right now? Professor Megan O'Sullivan, Professor of International Affairs 128 00:06:25,640 --> 00:06:29,479 Speaker 1: at Harvard's Kennedy School, former National Security Council advisor, also 129 00:06:29,640 --> 00:06:33,160 Speaker 1: a Bloomberg Opinion columnist. Professor, I'd love to get your 130 00:06:33,279 --> 00:06:37,680 Speaker 1: opinion for starters of how long in the making this 131 00:06:37,880 --> 00:06:41,440 Speaker 1: tiff between Saudi Arabia and Russia really was. I mean, 132 00:06:41,440 --> 00:06:45,040 Speaker 1: in other words, how entrenched are they on their respective sides, 133 00:06:45,240 --> 00:06:48,280 Speaker 1: unable or unwilling to come to the come to the 134 00:06:48,360 --> 00:06:52,520 Speaker 1: table and stop producing as much oil. Well, as you know, 135 00:06:53,120 --> 00:06:56,159 Speaker 1: Russia and Saudi Arabia and the rest of OPEC began 136 00:06:56,279 --> 00:07:02,640 Speaker 1: producing and cooperating in an unprecedented fashion towards in ten, 137 00:07:02,800 --> 00:07:05,520 Speaker 1: basically to deal with the price plunge of that time. 138 00:07:06,080 --> 00:07:09,600 Speaker 1: And for quite a few years people predicted that this 139 00:07:09,680 --> 00:07:14,120 Speaker 1: would be a very transitory relationship, both basically between Russia 140 00:07:14,440 --> 00:07:16,840 Speaker 1: and between Saudi Arabia, and it was more resilient than 141 00:07:16,920 --> 00:07:20,920 Speaker 1: people thought. Um every time there was an opportunity or 142 00:07:21,120 --> 00:07:24,000 Speaker 1: needs to renew a production cut or to revisit it. 143 00:07:24,360 --> 00:07:27,400 Speaker 1: People product predicted some kind of collapse like the one 144 00:07:27,480 --> 00:07:30,440 Speaker 1: that we saw on March six. But Um, I would 145 00:07:30,480 --> 00:07:34,440 Speaker 1: say that both sides have been taken by surprise at 146 00:07:34,520 --> 00:07:38,120 Speaker 1: the market reaction, because unlike the other times when it 147 00:07:38,200 --> 00:07:42,120 Speaker 1: looked like Russia might walk away from its cooperation with OPEC, 148 00:07:42,600 --> 00:07:46,200 Speaker 1: this time it we have both a supply surge and 149 00:07:46,360 --> 00:07:49,800 Speaker 1: we have this massive demand contraction. And so while both 150 00:07:49,880 --> 00:07:54,440 Speaker 1: sides I don't think we're planning for this fallout to happen, um, 151 00:07:54,640 --> 00:07:57,480 Speaker 1: the fact that it happened and that the repercussions have 152 00:07:57,600 --> 00:08:01,120 Speaker 1: been so dramatic, I think does create at least some 153 00:08:01,360 --> 00:08:04,120 Speaker 1: kind of an opportunity for the two sides to come 154 00:08:04,160 --> 00:08:07,680 Speaker 1: together in the coming I would say months. However, the 155 00:08:07,800 --> 00:08:10,600 Speaker 1: longer this goes on, I think there are certain new 156 00:08:10,720 --> 00:08:13,640 Speaker 1: variables that are coming into the mix that could change 157 00:08:13,760 --> 00:08:17,680 Speaker 1: the trajectory of what I think everyone began thinking was 158 00:08:17,840 --> 00:08:21,120 Speaker 1: just going to be a temporary kind of tiff that 159 00:08:21,200 --> 00:08:24,680 Speaker 1: would ultimately be resolved in coming together in a new 160 00:08:24,760 --> 00:08:29,440 Speaker 1: production cut. So, Megan, it's just extraordinary to me that 161 00:08:29,760 --> 00:08:33,240 Speaker 1: the behavior of Saudi Arabian Russia on the supply side, 162 00:08:33,240 --> 00:08:35,640 Speaker 1: given what we now know, about the demand side and 163 00:08:35,720 --> 00:08:39,959 Speaker 1: the creating demand for oil. Who do you think is 164 00:08:40,000 --> 00:08:43,760 Speaker 1: going to blink first? And why? Well, I mean, we 165 00:08:43,840 --> 00:08:47,760 Speaker 1: already have seen signs that the Russians are acknowledging that 166 00:08:47,920 --> 00:08:50,760 Speaker 1: the economic impact here is going to be greater than 167 00:08:50,840 --> 00:08:53,920 Speaker 1: they thought. We've seen the finance minister just a couple 168 00:08:53,960 --> 00:08:56,640 Speaker 1: of days ago talk about how Russia is going to 169 00:08:56,760 --> 00:08:59,360 Speaker 1: go into a deficit. You can see the impact on 170 00:08:59,440 --> 00:09:04,000 Speaker 1: the ruble um. Russia has more difficulty borrowing than Saudi Arabia, 171 00:09:04,160 --> 00:09:08,199 Speaker 1: so it probably is less well prepositioned to endure a 172 00:09:08,400 --> 00:09:12,160 Speaker 1: long term slow price decline. So I would say, if 173 00:09:12,240 --> 00:09:14,599 Speaker 1: we're really assuming that this is going to result in 174 00:09:14,640 --> 00:09:17,679 Speaker 1: the two sides coming together that at some point, I 175 00:09:17,760 --> 00:09:21,080 Speaker 1: think Saudi Arabia is not wrong in thinking that Russia 176 00:09:21,120 --> 00:09:23,000 Speaker 1: will feel the pain and there'll be an opportunity to 177 00:09:23,040 --> 00:09:25,760 Speaker 1: come back to the table. However, and I still think 178 00:09:25,800 --> 00:09:29,960 Speaker 1: that is the main most likely scenario. However, there are 179 00:09:30,000 --> 00:09:32,560 Speaker 1: a couple of things unfolding, as I mentioned that could 180 00:09:32,720 --> 00:09:37,640 Speaker 1: change the perspectives of these two players. One, the demand 181 00:09:37,760 --> 00:09:40,880 Speaker 1: plunge is so much deeper than people thought. I mean literally, 182 00:09:40,920 --> 00:09:44,360 Speaker 1: it's only been two weeks since these two countries came apart, 183 00:09:44,840 --> 00:09:48,160 Speaker 1: and we've seen that the projections for demand have changed dramatically. 184 00:09:48,440 --> 00:09:51,080 Speaker 1: Two weeks ago, Saudi Arabia was arguing that a cut 185 00:09:51,160 --> 00:09:53,439 Speaker 1: of one point five million barrels of oil a day 186 00:09:53,679 --> 00:09:56,760 Speaker 1: would be enough to stabilize the situation. People are now 187 00:09:57,000 --> 00:10:00,400 Speaker 1: talking about this quarter of oil demand going down by 188 00:10:00,520 --> 00:10:03,240 Speaker 1: ten million barrels of a loyal day. So coming together 189 00:10:03,360 --> 00:10:06,079 Speaker 1: to agree on a cut of a million barrels is actually, 190 00:10:06,640 --> 00:10:09,719 Speaker 1: even within these two weeks, is no longer perceived to 191 00:10:09,880 --> 00:10:14,319 Speaker 1: be sufficient to the challenge at hand. Also, we're seeing 192 00:10:14,600 --> 00:10:18,960 Speaker 1: producers in the US, Brazil, Canada already coming together and saying, 193 00:10:19,120 --> 00:10:21,280 Speaker 1: you know, it looks likely that our production is going 194 00:10:21,360 --> 00:10:24,679 Speaker 1: to shrink, We're going to have capex limitations. And this 195 00:10:24,880 --> 00:10:28,280 Speaker 1: is much quicker, I think than Saudi Arabia um expected. 196 00:10:28,360 --> 00:10:31,719 Speaker 1: And it must be heartening to these producers Russia and 197 00:10:31,760 --> 00:10:34,959 Speaker 1: Saudi Arabia that have been frustrated that their policies have 198 00:10:35,120 --> 00:10:39,319 Speaker 1: basically helped high cost producers. So it's possible that you 199 00:10:39,440 --> 00:10:42,240 Speaker 1: might have both of these sides, Saudi Arabian particular saying hey, 200 00:10:42,320 --> 00:10:45,319 Speaker 1: we didn't expect to move to the situation where we 201 00:10:45,440 --> 00:10:48,160 Speaker 1: were kind of playing for longer, and but here we are, 202 00:10:48,280 --> 00:10:50,439 Speaker 1: and maybe we have to make the best of it 203 00:10:50,640 --> 00:10:54,079 Speaker 1: given the situation. So despite that backdrop, given the glood 204 00:10:54,080 --> 00:10:56,800 Speaker 1: of production, and given the fact that demand is falling 205 00:10:56,840 --> 00:10:59,679 Speaker 1: off way faster than people had expected. I want to 206 00:10:59,760 --> 00:11:02,400 Speaker 1: put the perspective the huge rise in prices that we 207 00:11:02,440 --> 00:11:05,600 Speaker 1: saw yesterday after President Trump said that he could intervene, 208 00:11:06,240 --> 00:11:09,400 Speaker 1: that he would intervene if this carries on, and that 209 00:11:09,679 --> 00:11:12,720 Speaker 1: the US has great power to do so to bring 210 00:11:12,880 --> 00:11:16,600 Speaker 1: Saudi Arabia and Russia to the table. What power does 211 00:11:16,720 --> 00:11:21,240 Speaker 1: the United States have to to do that. Well, my 212 00:11:21,400 --> 00:11:24,480 Speaker 1: feeling is the President probably overstating the US power here. 213 00:11:24,880 --> 00:11:28,640 Speaker 1: The US does have a lot of diplomatic and political 214 00:11:28,760 --> 00:11:31,120 Speaker 1: leverage with Saudi Arabia just because of the importance of 215 00:11:31,160 --> 00:11:35,679 Speaker 1: that bilateral relationship, and so certainly you can imagine that 216 00:11:35,800 --> 00:11:38,120 Speaker 1: the United States would be putting a lot of pressure 217 00:11:38,120 --> 00:11:40,720 Speaker 1: on Saudi Arabia to come to the table, especially if 218 00:11:40,800 --> 00:11:44,280 Speaker 1: Russia started the show indications that is interested in doing so. 219 00:11:45,120 --> 00:11:49,480 Speaker 1: The United States does not have much control over Russian behavior, 220 00:11:49,679 --> 00:11:52,280 Speaker 1: and the thought was that the United States could threaten 221 00:11:52,400 --> 00:11:55,760 Speaker 1: some more sanctions. I actually think that could backfire We've 222 00:11:55,800 --> 00:11:59,839 Speaker 1: seen repeatedly over the last five years that Vladimir Putin 223 00:12:00,120 --> 00:12:02,920 Speaker 1: is willing to take an economic hit in order to 224 00:12:03,040 --> 00:12:05,439 Speaker 1: stand up to the United States. So to imagine that 225 00:12:05,520 --> 00:12:10,000 Speaker 1: the threat of sanctions could change Russia's calculation in a 226 00:12:10,080 --> 00:12:13,199 Speaker 1: way that makes it look like Putin is acquiescing to Trump, 227 00:12:13,280 --> 00:12:16,600 Speaker 1: I think that is not tenable. An interesting idea surface 228 00:12:16,720 --> 00:12:19,199 Speaker 1: just this morning you had one of the commissioners of 229 00:12:19,559 --> 00:12:24,240 Speaker 1: the Texas Railroad Commission saying, actually Texas could return to 230 00:12:24,320 --> 00:12:26,839 Speaker 1: a policy of pro rationing that it hasn't had since 231 00:12:26,880 --> 00:12:30,280 Speaker 1: the early seventies and rain in some of America's production. 232 00:12:30,720 --> 00:12:34,360 Speaker 1: That opens the possibility still likes say distant, but for 233 00:12:34,559 --> 00:12:39,480 Speaker 1: a Russia Saudi um uh Us conversation that the Russians 234 00:12:39,520 --> 00:12:42,120 Speaker 1: have wanted to have for a long time, and that 235 00:12:42,280 --> 00:12:44,079 Speaker 1: could be where this could go. This would be the 236 00:12:44,160 --> 00:12:47,480 Speaker 1: real wild card in this situation. But absence that, I 237 00:12:47,559 --> 00:12:51,280 Speaker 1: don't think the United States has the ability to solve 238 00:12:51,400 --> 00:12:54,520 Speaker 1: this problem just through diplomatic pressure. A. Megan, thanks so 239 00:12:54,640 --> 00:12:57,840 Speaker 1: much for your perspective. We really appreciate you helping us 240 00:12:58,000 --> 00:13:00,920 Speaker 1: understand what's going on the global energy markets. Megan O'Sullivan, 241 00:13:00,960 --> 00:13:04,520 Speaker 1: Professor of International Affairs at Harvard's Kennedy School, former National 242 00:13:04,600 --> 00:13:08,720 Speaker 1: Security Council advisor, and a Bloomberg opinion columnists giving us 243 00:13:08,760 --> 00:13:11,000 Speaker 1: her sense on the markets here weekend. We still have 244 00:13:11,040 --> 00:13:14,040 Speaker 1: a little bit weaker oil today after the big, big 245 00:13:14,120 --> 00:13:17,800 Speaker 1: pop yesterday, but still way way down supply and demand 246 00:13:18,080 --> 00:13:20,559 Speaker 1: not good for the price of oil. The question is 247 00:13:20,600 --> 00:13:23,400 Speaker 1: when will Saudi Arabia and Russia come to the table 248 00:13:23,760 --> 00:13:30,640 Speaker 1: uh and come to an agreement. This is Bloomberg. We 249 00:13:30,720 --> 00:13:33,520 Speaker 1: are looking at a markets that are trying to find 250 00:13:33,640 --> 00:13:38,400 Speaker 1: some calm after a storm that was the biggest storm 251 00:13:38,640 --> 00:13:41,000 Speaker 1: ever if you look at the VIX index and was 252 00:13:41,080 --> 00:13:45,160 Speaker 1: certainly included some of the biggest whip saws since seven 253 00:13:45,280 --> 00:13:48,280 Speaker 1: Black Monday. And the question is how do you find sane? 254 00:13:48,600 --> 00:13:50,520 Speaker 1: How do you find sanity? How do you find a 255 00:13:50,640 --> 00:13:55,280 Speaker 1: compass amid a complete dearth of any information? Peter Anderson, 256 00:13:55,320 --> 00:13:58,559 Speaker 1: a voice of reason, a voice of calm, founder of 257 00:13:58,640 --> 00:14:01,520 Speaker 1: Anderson Capital Management, joining us now. Peter, thank you so 258 00:14:01,640 --> 00:14:04,600 Speaker 1: much for being with us. What's going to help people 259 00:14:05,120 --> 00:14:07,560 Speaker 1: stay sane as they invest their money in this kind 260 00:14:07,559 --> 00:14:10,800 Speaker 1: of environment? Well, Lisa, I know that you've talked to 261 00:14:10,880 --> 00:14:13,680 Speaker 1: a lot of investors and a lot of investor managers, 262 00:14:13,720 --> 00:14:15,079 Speaker 1: and I thought I'd take a little bit of a 263 00:14:15,160 --> 00:14:17,920 Speaker 1: different take. Instead of just going back on histories of 264 00:14:18,520 --> 00:14:21,360 Speaker 1: UH selloffs and how we react, I thought I could 265 00:14:21,440 --> 00:14:24,080 Speaker 1: propose a couple of tools for everybody out there, because 266 00:14:24,120 --> 00:14:29,840 Speaker 1: I think most investors are feeling really uncomfortable about the 267 00:14:29,960 --> 00:14:32,800 Speaker 1: information and how they should act on this information. And 268 00:14:32,880 --> 00:14:35,360 Speaker 1: if we could just get some simple categories, I think 269 00:14:35,400 --> 00:14:38,000 Speaker 1: that might help people. So I have a couple of suggestions. 270 00:14:38,040 --> 00:14:42,440 Speaker 1: The first thing is this concept of leading versus lagging indicators. 271 00:14:42,480 --> 00:14:45,680 Speaker 1: Now we've used those a lot in economics and investing, 272 00:14:45,800 --> 00:14:48,640 Speaker 1: but probably not so much when we're talking about something 273 00:14:48,720 --> 00:14:52,480 Speaker 1: like the virus. And if you recall Dr Fauci recently 274 00:14:52,640 --> 00:14:55,120 Speaker 1: mentioned he made a little bit of a reference to 275 00:14:55,240 --> 00:14:57,920 Speaker 1: this when he said, look what we're seeing now are 276 00:14:58,000 --> 00:15:00,680 Speaker 1: the results of what the virus did two weeks ago. 277 00:15:01,160 --> 00:15:04,200 Speaker 1: So I find it very helpful. Whenever new information comes, 278 00:15:04,240 --> 00:15:07,760 Speaker 1: I put it in a category. Is this leading indicator 279 00:15:07,960 --> 00:15:10,760 Speaker 1: or a lagging indicator? And what should I do if 280 00:15:10,840 --> 00:15:13,440 Speaker 1: it is lagging? It doesn't matter that much to me, 281 00:15:13,520 --> 00:15:15,640 Speaker 1: But the leading indicators are the things I think we 282 00:15:15,640 --> 00:15:19,600 Speaker 1: should focus on. Interesting, Peter, So as we think about 283 00:15:19,600 --> 00:15:22,120 Speaker 1: this market volatility. Are you trying to Are you suggesting 284 00:15:22,160 --> 00:15:25,480 Speaker 1: to your clients that they sit on the sidelines and 285 00:15:25,760 --> 00:15:28,720 Speaker 1: not panic and maybe take the longer view here, And 286 00:15:28,800 --> 00:15:31,920 Speaker 1: if so, are you having any success with that? Well? 287 00:15:31,960 --> 00:15:35,000 Speaker 1: I am. You know, I've talked to all my clients 288 00:15:35,120 --> 00:15:39,400 Speaker 1: and most of them are saying and mature that they say, Look, 289 00:15:39,520 --> 00:15:42,680 Speaker 1: I've seen versions of this in the past. You know, 290 00:15:42,880 --> 00:15:45,840 Speaker 1: the virus is a new twist, but in terms of selloffs, 291 00:15:46,600 --> 00:15:49,800 Speaker 1: we've been here before, and we also are quite familiar 292 00:15:49,840 --> 00:15:53,440 Speaker 1: with the way we react psychologically and from a behavioral perspective, 293 00:15:53,560 --> 00:15:57,360 Speaker 1: So why don't we focus on what the leading indicators are? 294 00:15:57,480 --> 00:15:59,840 Speaker 1: And so to me, the leading indicators are when we 295 00:16:00,040 --> 00:16:02,920 Speaker 1: have the press conferences every day, I tell them to 296 00:16:03,000 --> 00:16:05,280 Speaker 1: focus on the following you know, what are the what 297 00:16:05,480 --> 00:16:08,720 Speaker 1: is the news about the vaccination? What's the news about 298 00:16:09,480 --> 00:16:13,040 Speaker 1: trends in the current cases, not the past cases, but 299 00:16:13,160 --> 00:16:15,560 Speaker 1: what might be happening in the future, Because when we 300 00:16:15,680 --> 00:16:18,920 Speaker 1: get these cases reported to us now, they're just going 301 00:16:18,960 --> 00:16:22,320 Speaker 1: to get worse because it's the results of the virus 302 00:16:22,360 --> 00:16:25,320 Speaker 1: in the past. So looking forward, also, let's think of 303 00:16:25,680 --> 00:16:29,440 Speaker 1: do they announce new innovative approaches, For instance, yesterday they 304 00:16:29,520 --> 00:16:33,920 Speaker 1: mentioned cruise ships could be available for hospital beds. I 305 00:16:34,000 --> 00:16:37,000 Speaker 1: think that's very creative if we need that. They've also 306 00:16:37,120 --> 00:16:40,560 Speaker 1: mentioned drive by testing. So the more creative we get 307 00:16:40,640 --> 00:16:42,520 Speaker 1: with this, and the more we get a handle on 308 00:16:42,800 --> 00:16:45,480 Speaker 1: when the virus is going to peak, that is the 309 00:16:45,680 --> 00:16:49,680 Speaker 1: main driver of everything. Everything else, to me is expendable 310 00:16:49,720 --> 00:16:52,080 Speaker 1: at this point. But we should focus on what are 311 00:16:52,080 --> 00:16:54,840 Speaker 1: the leading indicators to tell us when we think this 312 00:16:55,120 --> 00:16:57,800 Speaker 1: might crest, and then we're off to the races, because 313 00:16:57,840 --> 00:17:00,280 Speaker 1: then we have a data point and we can say, okay, 314 00:17:00,360 --> 00:17:02,680 Speaker 1: what should our actions be as a result of now 315 00:17:02,840 --> 00:17:07,639 Speaker 1: knowing that we've reached the maximum case accumulation. Well, and 316 00:17:07,720 --> 00:17:10,880 Speaker 1: speaking of press conferences and paying attention, we will bring 317 00:17:10,960 --> 00:17:14,760 Speaker 1: you some comments by Treasury Secretary Stephen Mnuchin and UH 318 00:17:15,040 --> 00:17:18,960 Speaker 1: majority leader and seminjority leader Mitch McConnell. They will be 319 00:17:19,119 --> 00:17:25,280 Speaker 1: joining shortly and with some comments that they gave in Washington, 320 00:17:25,359 --> 00:17:27,040 Speaker 1: d C. And we will bring them to you when 321 00:17:27,119 --> 00:17:29,920 Speaker 1: we get them. But there is a question when you 322 00:17:30,000 --> 00:17:32,960 Speaker 1: start talking about how people have been through this type 323 00:17:33,000 --> 00:17:36,240 Speaker 1: of thing before, have they? I mean, this is sort 324 00:17:36,280 --> 00:17:38,639 Speaker 1: of one thing that I'm struck by the speed that 325 00:17:38,760 --> 00:17:42,680 Speaker 1: this has occurred has just been so dramatic that in 326 00:17:42,880 --> 00:17:46,240 Speaker 1: some ways it feels like perhaps this is a different 327 00:17:46,359 --> 00:17:49,199 Speaker 1: kind of sell off and a different kind of economic 328 00:17:49,320 --> 00:17:53,160 Speaker 1: downturn than we have seen in modern history. Do you agree, Yes, 329 00:17:53,280 --> 00:17:55,240 Speaker 1: I do. I mean to a great extent, of course. 330 00:17:55,280 --> 00:17:57,640 Speaker 1: You know, when you look back at the major sell offs, 331 00:17:57,800 --> 00:18:01,800 Speaker 1: each one has its own story in its own cause, 332 00:18:02,080 --> 00:18:05,080 Speaker 1: and who would have expected, uh, something like a virus 333 00:18:05,200 --> 00:18:09,040 Speaker 1: to have this major world impact. So I agree with 334 00:18:09,160 --> 00:18:12,240 Speaker 1: you on that level. However, I also say that we 335 00:18:12,400 --> 00:18:15,119 Speaker 1: can look back at how we react to each one 336 00:18:15,200 --> 00:18:18,359 Speaker 1: of these surprises. Peter Anderson, a voice of reason, founder 337 00:18:18,440 --> 00:18:23,320 Speaker 1: of Anderson Capital Management, joining us by phone. Really interesting, 338 00:18:23,400 --> 00:18:26,040 Speaker 1: trying to find that compass right now amid a sea 339 00:18:26,080 --> 00:18:28,639 Speaker 1: of uncertainty. Paul, Yeah, it really is. At Lisa, and 340 00:18:28,680 --> 00:18:30,640 Speaker 1: I think a lot of investors, Um, you know, they're 341 00:18:30,760 --> 00:18:32,919 Speaker 1: if they haven't already panicked, Um, you know, I think 342 00:18:32,920 --> 00:18:34,960 Speaker 1: they're obviously I was looking at their portfolios, looking at 343 00:18:34,960 --> 00:18:37,000 Speaker 1: their flour one case, and just kind of in shock here. 344 00:18:37,080 --> 00:18:39,720 Speaker 1: But um, you know, I think one constructive thing is 345 00:18:39,760 --> 00:18:42,280 Speaker 1: to really take a look on the other side. When 346 00:18:42,320 --> 00:18:44,560 Speaker 1: we do get the other side, How do you want 347 00:18:44,600 --> 00:18:46,440 Speaker 1: to be positioned, what do you want to maybe look 348 00:18:46,520 --> 00:18:49,400 Speaker 1: at in terms of some investment opportunities. So that's hard 349 00:18:49,440 --> 00:18:52,240 Speaker 1: to do right now as we continue see the Baltilo 350 00:18:52,280 --> 00:18:54,359 Speaker 1: in the markets. But I think that's what Peter was 351 00:18:54,400 --> 00:19:00,960 Speaker 1: suggesting that his clients do. The Federal Reserve just announced 352 00:19:01,320 --> 00:19:05,280 Speaker 1: coordinated Central Bank swap line enhancements. It says it will 353 00:19:05,320 --> 00:19:08,120 Speaker 1: act with the Bank of England, Bank of Canada, Bank 354 00:19:08,160 --> 00:19:11,760 Speaker 1: of Japan, the European Central Bank, and the Swiss National Bank. 355 00:19:12,119 --> 00:19:16,360 Speaker 1: The swap lines to commence on March twenty through three, 356 00:19:16,840 --> 00:19:20,040 Speaker 1: and they will go through UH the end of April 357 00:19:20,240 --> 00:19:23,359 Speaker 1: at least. And this would be the dollar swap lines 358 00:19:23,400 --> 00:19:26,520 Speaker 1: that they initiated over the past few weeks UH in 359 00:19:26,800 --> 00:19:29,960 Speaker 1: order to ease up some of the dollars shortage and 360 00:19:30,080 --> 00:19:32,879 Speaker 1: liquidity crunch there a few weeks, a few days, I 361 00:19:32,960 --> 00:19:36,560 Speaker 1: should say, it's been weeks at least each day has 362 00:19:36,600 --> 00:19:39,200 Speaker 1: felt like that. And meanwhile they're going to switch each 363 00:19:39,280 --> 00:19:45,840 Speaker 1: swap line daily from weekly, just showing this ongoing effort 364 00:19:45,960 --> 00:19:49,040 Speaker 1: to try to ease some of the kinks in the 365 00:19:49,680 --> 00:19:53,359 Speaker 1: workings of financial markets right now. Yeah, global coordination there 366 00:19:53,359 --> 00:19:55,240 Speaker 1: at least, I think that's the key takeaway here and 367 00:19:55,280 --> 00:19:57,840 Speaker 1: again it goes to that liquidity issue or cross markets 368 00:19:58,359 --> 00:20:00,400 Speaker 1: that we've been talking about. So it's ice to see 369 00:20:00,400 --> 00:20:05,000 Speaker 1: the coordination. So our Jersey chief strate strategist at Bloomberg Intelligence, Uh, 370 00:20:05,280 --> 00:20:08,159 Speaker 1: we have him standing by here to give us his 371 00:20:08,280 --> 00:20:11,000 Speaker 1: sense on how important this is. And we have seen 372 00:20:11,119 --> 00:20:13,400 Speaker 1: some dollar weakness today which has actually been a huge 373 00:20:13,440 --> 00:20:16,440 Speaker 1: positive for global markets. I mean, are we seeing the 374 00:20:16,560 --> 00:20:19,520 Speaker 1: beginnings of this bleed into markets the feed is actually 375 00:20:19,600 --> 00:20:23,320 Speaker 1: being successful in easing some of the dollar shortage. Yes, 376 00:20:23,359 --> 00:20:26,080 Speaker 1: so I I do think that this type of activity 377 00:20:26,119 --> 00:20:30,359 Speaker 1: in particular will be helpful for markets globally and primarily 378 00:20:30,520 --> 00:20:33,320 Speaker 1: for uh, those folks who have funded in dollars who 379 00:20:33,359 --> 00:20:35,920 Speaker 1: aren't in the United States, right, So that that's really 380 00:20:35,960 --> 00:20:38,720 Speaker 1: where the funding shortage in dollars has been. That people 381 00:20:38,720 --> 00:20:41,119 Speaker 1: have been hoarding their dollars wanting to keep them as 382 00:20:41,160 --> 00:20:45,119 Speaker 1: a safe haven currency. Um. So this allows basically for 383 00:20:45,240 --> 00:20:48,760 Speaker 1: the flow of dollars in the global financial world to 384 00:20:48,960 --> 00:20:51,560 Speaker 1: to continue. And the fact that they're doing these weekly 385 00:20:51,640 --> 00:20:54,800 Speaker 1: operations on a daily basis I think is important because 386 00:20:55,200 --> 00:20:57,840 Speaker 1: that means that there's liquidity on demand. So the way 387 00:20:57,920 --> 00:20:59,960 Speaker 1: that they did it before by only having an offer 388 00:21:00,000 --> 00:21:02,680 Speaker 1: and once a week is you only had liquidity on 389 00:21:02,800 --> 00:21:05,240 Speaker 1: that day, you didn't have liquidity all those other days. 390 00:21:05,359 --> 00:21:07,919 Speaker 1: So UM, while I think the total dollar amounts might 391 00:21:07,960 --> 00:21:10,760 Speaker 1: not be massive in this program, UM, keep in mind 392 00:21:10,800 --> 00:21:13,040 Speaker 1: they did get up to almost five hundred billion dollars 393 00:21:13,160 --> 00:21:15,879 Speaker 1: during the crisis. So it's very possible that you can 394 00:21:15,960 --> 00:21:18,399 Speaker 1: wind up with you know, fifty a hundred billion dollars 395 00:21:18,560 --> 00:21:22,119 Speaker 1: of usage in these swap lines um every day. And 396 00:21:22,359 --> 00:21:24,119 Speaker 1: and you know, so you wind up with with a 397 00:21:24,280 --> 00:21:27,680 Speaker 1: rolling hundred billion dollars every day that that basically helps 398 00:21:27,680 --> 00:21:29,359 Speaker 1: the financial markets to work. You know, some of the 399 00:21:29,400 --> 00:21:31,640 Speaker 1: other things that the Fed's done, I don't think we'll 400 00:21:31,640 --> 00:21:34,840 Speaker 1: have a massive issue. Like last night the FED announced 401 00:21:34,880 --> 00:21:37,879 Speaker 1: that they were bringing back the commercial paper. Um that 402 00:21:38,000 --> 00:21:40,800 Speaker 1: that the money market funding Facility book. Great. Frankly, money 403 00:21:40,840 --> 00:21:43,159 Speaker 1: markets weren't really your problem this time. This is you know, 404 00:21:43,359 --> 00:21:45,880 Speaker 1: this is a much different crisis than two thousand eight. Well, 405 00:21:46,000 --> 00:21:47,720 Speaker 1: I do want to just before we let you go, 406 00:21:47,760 --> 00:21:49,439 Speaker 1: because I know you've got a lot on your plate. 407 00:21:49,800 --> 00:21:53,119 Speaker 1: There is still a question though about the demand for dollars. 408 00:21:53,240 --> 00:21:55,359 Speaker 1: And I look at one month and three months t bills. 409 00:21:55,400 --> 00:21:58,000 Speaker 1: The rates on those are both negative. You can find 410 00:21:58,200 --> 00:22:01,760 Speaker 1: negative rates currently in the United States. Is that a 411 00:22:01,880 --> 00:22:04,200 Speaker 1: concern for you given the fact that the lower bound 412 00:22:04,320 --> 00:22:06,840 Speaker 1: for the Federal Reserve has been and has been stated 413 00:22:06,880 --> 00:22:09,359 Speaker 1: to get again is zero and they are not planning 414 00:22:09,400 --> 00:22:12,480 Speaker 1: to go negative. Well, I don't think that that's a problem. 415 00:22:12,520 --> 00:22:15,119 Speaker 1: I think that does show you the risk off mentality 416 00:22:15,280 --> 00:22:17,960 Speaker 1: that's still pervasive within the markets. And and you know 417 00:22:18,119 --> 00:22:20,760 Speaker 1: the fact that you have UM interest rates that are 418 00:22:20,800 --> 00:22:23,720 Speaker 1: not going to go up anytime soon. The UH, the 419 00:22:23,960 --> 00:22:26,399 Speaker 1: the idea that you have UH tea bills that are 420 00:22:26,440 --> 00:22:29,000 Speaker 1: still in demand. It's basically the the safe haven of 421 00:22:29,040 --> 00:22:31,280 Speaker 1: safe havens. If you if you have to buy securities 422 00:22:31,320 --> 00:22:34,000 Speaker 1: and you can't hold cash, then you have to buy 423 00:22:34,080 --> 00:22:36,119 Speaker 1: something and that winds up being in front of te bills. 424 00:22:36,160 --> 00:22:38,320 Speaker 1: And you know that this did happen. I mean this 425 00:22:38,440 --> 00:22:40,199 Speaker 1: did happen not so long ago. You look at two 426 00:22:40,240 --> 00:22:43,080 Speaker 1: thousand eleven, you look at two thousands nine, you had 427 00:22:43,200 --> 00:22:45,959 Speaker 1: negative tea bill yield. So this is this a rehash 428 00:22:46,000 --> 00:22:48,080 Speaker 1: of that. This is almost like you know, where is 429 00:22:48,280 --> 00:22:50,520 Speaker 1: last time in two thousand seven and two thousand nine 430 00:22:50,800 --> 00:22:55,200 Speaker 1: you had a significant um uh. It took a little 431 00:22:55,240 --> 00:22:57,320 Speaker 1: while for all of this to happen. This is kind 432 00:22:57,320 --> 00:23:02,400 Speaker 1: of just the sped up version of of a risk off. Yeah, 433 00:23:03,240 --> 00:23:04,560 Speaker 1: thanks so much for giving us a few minutes. We 434 00:23:04,640 --> 00:23:06,560 Speaker 1: know you're busy, but we appreciate your insight. There, our 435 00:23:06,680 --> 00:23:10,119 Speaker 1: Jersey chief interest rate strategist for Bloomberg Intelligence looking at 436 00:23:10,119 --> 00:23:12,520 Speaker 1: the markets. Here, we are slightly green on the screen. 437 00:23:12,600 --> 00:23:15,200 Speaker 1: Let's see where the action is. Bloomberg Stocks editor Dave Wilson, David, 438 00:23:15,200 --> 00:23:17,719 Speaker 1: are you looking at this morning? Well, even though uh, 439 00:23:18,280 --> 00:23:20,320 Speaker 1: you know, we were green, I should say that the 440 00:23:20,800 --> 00:23:23,560 Speaker 1: SMP is now turned lower by a tenth of a percent. 441 00:23:24,119 --> 00:23:27,200 Speaker 1: You have more stocks down than up. I mean you're 442 00:23:27,240 --> 00:23:31,399 Speaker 1: seeing department stores or one area that jumps out because 443 00:23:31,640 --> 00:23:34,439 Speaker 1: you know, you had Coals closing all of its US 444 00:23:34,520 --> 00:23:39,040 Speaker 1: retail stores more than locations until at least April first 445 00:23:39,200 --> 00:23:41,680 Speaker 1: because of the coronavirus. Coals is down about seven and 446 00:23:41,680 --> 00:23:45,120 Speaker 1: a half percent. You're seeing Macy's Nordstrom fault as well. 447 00:23:45,680 --> 00:23:47,680 Speaker 1: And then there's the story of a T and T. 448 00:23:47,920 --> 00:23:50,920 Speaker 1: And that's a pretty interesting case because this is a 449 00:23:51,000 --> 00:23:54,040 Speaker 1: company that's been buying back stock that they issued when 450 00:23:54,080 --> 00:23:57,680 Speaker 1: they bought Time Warner. They had a four billion dollar 451 00:23:57,800 --> 00:24:02,760 Speaker 1: program in place to do that uh, after a previous 452 00:24:02,920 --> 00:24:06,760 Speaker 1: one in December what they call an Accelerated Share Approaches 453 00:24:06,840 --> 00:24:10,480 Speaker 1: program worked out with Morgan Stanley. Pretty common for companies 454 00:24:10,520 --> 00:24:13,600 Speaker 1: to go this route. So today A T and T 455 00:24:13,880 --> 00:24:17,440 Speaker 1: comes out and says we're canceling the current program. And 456 00:24:17,640 --> 00:24:19,960 Speaker 1: we report that A T and T is going for 457 00:24:20,160 --> 00:24:24,520 Speaker 1: three billion dollars and loans to try and bolster its finances. 458 00:24:24,560 --> 00:24:26,760 Speaker 1: So you put that all together, you've got A T 459 00:24:26,880 --> 00:24:29,680 Speaker 1: and T down six and a half percent. So I 460 00:24:29,720 --> 00:24:32,159 Speaker 1: mean it's really two sides of the same coin in 461 00:24:32,200 --> 00:24:36,359 Speaker 1: a sense, companies pulling back from buying back their shares 462 00:24:36,400 --> 00:24:38,480 Speaker 1: even though they're way down clearly from where they were 463 00:24:38,600 --> 00:24:43,760 Speaker 1: just a month ago, and increasingly having to line up 464 00:24:43,880 --> 00:24:46,800 Speaker 1: financing at the very least to make sure that they 465 00:24:46,880 --> 00:24:50,520 Speaker 1: can keep their business going. Tables and Bloomberg Sox editor, 466 00:24:50,600 --> 00:24:53,560 Speaker 1: thank you so much for the update. Thanks for listening 467 00:24:53,600 --> 00:24:56,080 Speaker 1: to the Bloomberg pen L podcast. You can subscribe and 468 00:24:56,119 --> 00:24:59,240 Speaker 1: listen to interviews at Apple Podcasts or whatever podcast platform 469 00:24:59,320 --> 00:25:02,360 Speaker 1: you prefer. I'm Paul Sweeney, I'm on Twitter at pt Sweeney. 470 00:25:02,440 --> 00:25:04,920 Speaker 1: I'm Lisa abram Woods. I'm on Twitter at Lisa abram 471 00:25:04,960 --> 00:25:08,240 Speaker 1: woits one before the podcast. You can always catch us worldwide. 472 00:25:08,240 --> 00:25:09,200 Speaker 1: I'm Bloomberg Radio.