Speaker 1: Scrap on your parachute. It's time for What Goes Up
Speaker 1: with Sarah Ponza and Mike Reagan. Hello, and welcome to
Speaker 1: What Goes Up, a Bloomberg Weekly Markets podcast. I'm Sarah
Speaker 1: pons a reporter on the Cross Asset team, and I'm
Speaker 1: Mike Reagan, a senior editor at Bloomberg. And you can
Speaker 1: think of me as the Louise to Sarah's Thelma. You know,
Speaker 1: I love how I don't have any warning that these
Speaker 1: are coming, Mike. It's maybe every three weeks, every two weeks,
Speaker 1: every five weeks. You just throw them in there. Yeah,
Speaker 1: it's good, it's good. Well this week on the show.
Speaker 1: Come next week, President elect Joe Biden will become the
Speaker 1: forty six president of the United States. Our guests this
Speaker 1: week has worked in senior economic and trade policy roles
Speaker 1: under five different US presidents and he spent twenty five
Speaker 1: years of golden sacks. He'll walk us through with the
Speaker 1: new administration's policy proposed could mean for both the economy
Speaker 1: and markets, and as usual, we will finish the episode
Speaker 1: with our tradition, the craziest thing I saw in markets
Speaker 1: this week, Sarah, I'll give you one teaser. Uh, once again.
Speaker 1: My craziest thing in markets is bitcoin related. I know
Speaker 1: a lot of listeners crave that bitcoin content. And for
Speaker 1: the craziest thing segment, it's a it's a deep well
Speaker 1: to go to. For sure. I'm gonna go ahead and
Speaker 1: say I did have a listener reach out to me
Speaker 1: on Twitter, and I have a feeling that your crazy
Speaker 1: thing might be the same as his. All Right, you might.
Speaker 1: You may think so. You may think so, but I
Speaker 1: think I gotta I think it's gonna be a curveball.
Speaker 1: But before we get to that, let's talk about the
Speaker 1: the important issues of the day. As Sarah pointed out,
Speaker 1: our guest this week, UM has one of the most
Speaker 1: fascinating resumes. I think I've I've ever read uh five
Speaker 1: different US presidents from Nixon all the way up to Obama. Sarah,
Speaker 1: I think the way you define yourself in this day
Speaker 1: and age is by the company you keep over zoom uh.
Speaker 1: And I'll give you an example. I read My last
Speaker 1: zoom call was with a bunch of guys I went
Speaker 1: to high school with. And it was a Saturday night.
Speaker 1: I think a guy's had a few drinks. Maybe one
Speaker 1: guy fell asleep during the zoom and started snoring and
Speaker 1: if if if you zoom a talent, but if you
Speaker 1: know al zoom works as we all do by now,
Speaker 1: the microphone and the video follows who's ever making the noise.
Speaker 1: So we'd be trying to talk and catch up and
Speaker 1: this guy would start snoring, and that he'd dominate and
Speaker 1: then we don't have to wait for him to get
Speaker 1: his snore out, and then we start talking about we
Speaker 1: try to rush it in and then another big storm comes.
Speaker 1: Our guest, on the other hand, has a much better
Speaker 1: zoom uh story for us. He was recently zooming with
Speaker 1: the Foreign Minister of China, So hopefully no one fell
Speaker 1: asleep and started snorting snoring on that zoom call. But
Speaker 1: we're very happy to have him back on the show.
Speaker 1: He is started mentioned just a really phenomenal interesting career,
Speaker 1: long time at Goldman Uh, several really interesting white house jobs.
Speaker 1: He's currently managing director at Taman Advisers. His name is
Speaker 1: Bob Hormetts. Bob, welcome back to the show. Thank you
Speaker 1: very much. It's always a pleasure to be on this
Speaker 1: show and I enjoy Bloomberg. I particularly enjoyed it when
Speaker 1: I get up in the morning at six am, come
Speaker 1: in and drink a triple Lotte Espresso. These days, Bob,
Speaker 1: we go to expresso to go on Tom Kean show.
Speaker 1: You needed at least three expressos or three latdays to
Speaker 1: get up to that level of proficiency and energy that
Speaker 1: Tom exods, right. I think I'm not I'm still not
Speaker 1: ready for Tom after that many lattases. So I don't know.
Speaker 1: I think I think you need the latte's and a
Speaker 1: and a and a resume like hers to talk to
Speaker 1: Tom at that hour, Bob. So, uh, but let's talk
Speaker 1: about that. I think China, the relationship with China right now,
Speaker 1: I think is is at such a fascinating point, obviously
Speaker 1: with the change of the administration. So tell us, you know,
Speaker 1: tell us about that zoom call. I hope no one
Speaker 1: was snoring. But also what's your sense of sort of
Speaker 1: you know, how Beijing is viewing the relationship with the
Speaker 1: US as we sort of turned the page on on
Speaker 1: this White House. Well, there are different levels, uh, in
Speaker 1: this relationship. One clearly, President Jijiping has aspirations of Chinese
Speaker 1: leadership of the global economic order, uh and perhaps political
Speaker 1: order of the first part of the twenty one century,
Speaker 1: and really wants China to play a global leadership role
Speaker 1: and help shape the global political and economic order of
Speaker 1: this period, and in part over the last several years,
Speaker 1: because the US has really not played a very proactive
Speaker 1: role in shaping the order or in supporting alliances or
Speaker 1: international institutions, the Chinese have seen the opportunity to take
Speaker 1: advantage of this opening and to exert leadership. So that's
Speaker 1: really part one. Part two is that shi Jin Pain
Speaker 1: has strengths and the role of the Communist Party in China. Uh.
Speaker 1: He is clearly um one of the most dominant UH
Speaker 1: personalities and strongest leaders China has had since the revolution
Speaker 1: in four in the hand of the revolution the Declaration
Speaker 1: of the Peoples Republic of China in nine. Uh, you know,
Speaker 1: there was mouth, there was Don chall Pain, and now
Speaker 1: we have the very powerful leadership of Shijin Pain. And
Speaker 1: he wants to not only ensure the strength of his leadership,
Speaker 1: but the continued strong role of the Communist Party. And three,
Speaker 1: he is clearly intent on developing China's role as a
Speaker 1: global technological power of the first order in AI, quantum computing,
Speaker 1: five G, any number of things. He feels that China
Speaker 1: was passed over because of its own internal weakness and
Speaker 1: because of the West sort of um leaping ahead in
Speaker 1: the last two industrial revolutions. He wants China to be
Speaker 1: a leader in the technological revolution of the twenty one century,
Speaker 1: and that means competing very hard with the United States
Speaker 1: and putting a lot of money into this competitive effort.
Speaker 1: Uh And and there's certainly a greater degree of nationalism
Speaker 1: in China than before, and a lot of tensions with
Speaker 1: the US over intellectual property protection, how to deal with businesses,
Speaker 1: trade secrets, a whole range of things. But the last
Speaker 1: point is that the Chinese also and this was emphasized
Speaker 1: by the Foreign Minister h also want to be able
Speaker 1: to work with the United States in certain areas where
Speaker 1: there is the potential for collaboration. Certainly there has been
Speaker 1: a history of cooperation on medical issues. Chinese doctors work
Speaker 1: in virtually every hospital in this country. China is working
Speaker 1: on advanced medicines, including vaccines and therapeutics. China also wants
Speaker 1: to play a major leadership role on environmental issues. And
Speaker 1: if the US, now under Biden, wants to regain its
Speaker 1: leadership on environmental issues, we're gonna have to find some
Speaker 1: way of working with China, as the Obama administration did.
Speaker 1: And then there's the financial area, where if you go
Speaker 1: back to two thousand and eight, the financial crisis of
Speaker 1: that era was resolved in large measure because of the
Speaker 1: cooperation between the United States and China. The People's Bank
Speaker 1: of China and the FED, the US Treasury in the
Speaker 1: Chinese Finance Ministry worked very close to the other. So
Speaker 1: it's a competitive relationship. We're dealing with a country that
Speaker 1: is far more competitive and far more areas than the
Speaker 1: United States has faced at any time during the postwar period,
Speaker 1: and we have to figure out how we can strengthen
Speaker 1: our own competitive capabilities if we're going to compete with China,
Speaker 1: and that I think is one of the things that
Speaker 1: President Biden will want to emphasize. So what's the expectation
Speaker 1: do you feel on how the Biden administration is going
Speaker 1: to go about walking that line between competition and cooperation.
Speaker 1: I think of the last four years, and clearly tariffs
Speaker 1: had effect an effect on the economy and markets. We've
Speaker 1: heard of stock delistings back and forth and back and
Speaker 1: forth whether or not those in the US can invest
Speaker 1: in Chinese companies. What do you think the Biden administration
Speaker 1: is going to target here well, I think as the
Speaker 1: Biden administration's tone each to each China will not be
Speaker 1: as strident as um the Trump administration's tone. But I
Speaker 1: do think that Biden and both Republicans and Democrats and
Speaker 1: the business community in general want a tougher line on China.
Speaker 1: And then the United States has displayed before on such
Speaker 1: things as intellectual property, the rules with respected data privacy,
Speaker 1: how far earned companies are dealt with a whole range
Speaker 1: of things for trade secrets of American companies. So I
Speaker 1: think he's going to uh not revert back to the
Speaker 1: uh softer period of of the past, but we'll take
Speaker 1: a harder line. I don't expect an immediate withdrawal of
Speaker 1: some of the tariffs uh. And I don't expect another
Speaker 1: grand round of trade negotiations is so called Round two.
Speaker 1: I think you will try to get China to comply
Speaker 1: with the commitments of Round one. But I do think
Speaker 1: two things will happen. First, the United States has to
Speaker 1: decide what it really wants from China. Can't just present
Speaker 1: a whole menu so called Chinese menu uh and say
Speaker 1: we want you do all these things. We have to
Speaker 1: figure out, preferably on a bipartisan basis, what the priorities
Speaker 1: are from our own part point of view. Second, how
Speaker 1: we work with our friends and allies. And I think
Speaker 1: this has been a deficiency over the last several years,
Speaker 1: that we we have so many trade hassles with our
Speaker 1: friends and allies using various parts of Trade Act or
Speaker 1: Trade Act, that they are not in a mood to
Speaker 1: really work with the United States on China, even though
Speaker 1: many of our objectives vias of each China are similar
Speaker 1: to the objectives of other countries like Germany. For instance,
Speaker 1: the Chinese book this big robotics company called Puca, and
Speaker 1: then the Germans wanted to buy a large, comparable, not
Speaker 1: the same, but comparable Chinese company. Chinese said no, and
Speaker 1: of course the Germans said, this is not fair, it's
Speaker 1: not a level of playing field. So I think that
Speaker 1: if we're smart, will not only develop our own sets
Speaker 1: of objectives, to find out what other countries objectives are
Speaker 1: and figure out where there are ways of working with
Speaker 1: other countries collectively to convince China to adhere to certain
Speaker 1: rules and norms and practices. And that means working with Japan,
Speaker 1: South Korea, the EU, and countries such as India and others,
Speaker 1: and related to that, I don't think the Biden administration
Speaker 1: is going to immediately in part for domestic political reasons.
Speaker 1: Um they're the Republicans who don't like it, Democrats who
Speaker 1: don't like it. That is to say, a new t
Speaker 1: p P or the new t p P M. I
Speaker 1: don't think Asas is going to come back and join
Speaker 1: that right away. But I think there are elements of
Speaker 1: the current tpp that the United States can support, and
Speaker 1: the United States can certainly work the other with members
Speaker 1: of the new t p P on these of each China,
Speaker 1: on issues where there is common ground, there's a certain
Speaker 1: common sense of a mutual objective, so we don't have
Speaker 1: to rejoin it, but we do need to work with
Speaker 1: it in the in the near term. In the medium term,
Speaker 1: I think there'll be a lot of talked about the
Speaker 1: United States rejoining some kind of t p P like
Speaker 1: mechanism because it shows cohesion economically in the Pacific, but
Speaker 1: are also demonstrates that the United States is back as
Speaker 1: a major player instead of pulling back on the economic front,
Speaker 1: is collaborating in a more effective way on the economic front.
Speaker 1: And the t p P is a vehicle that was
Speaker 1: designed to do that, and since the United States pulled
Speaker 1: away from it, we have sort of left that vehicle
Speaker 1: to others. The Japanese have done a great job of
Speaker 1: leadership of that, but the United States still needs to
Speaker 1: play a role in it, Bob. So many of President
Speaker 1: Trump's policies were motivated by the trade deficit. Um and here,
Speaker 1: you know, as he prepares to sort of right off
Speaker 1: into the sunset China's last trade report, it looks like
Speaker 1: their exports, UH, their their trade surplus UH is at
Speaker 1: a record high. I mean, I guess you can, you know,
Speaker 1: you can look at some of the U S data
Speaker 1: and see that our exports to China as as a
Speaker 1: percentage of of exports have have risen significantly. And obviously
Speaker 1: the virus has just uh really clouded these numbers pretty severely.
Speaker 1: But I wonder, you know, when you look back on
Speaker 1: everything that was done to shrink that trade deficit, I wonder, a, um,
Speaker 1: will it work eventually once we're through the other side
Speaker 1: of this virus? And b is that sort of hyper
Speaker 1: focus on the trade deficit a good idea from the
Speaker 1: American perspective? Is it sort of our our main problem
Speaker 1: or is there you know, is it? Is it kind
Speaker 1: of overblown that to focus on it so so severely, Well,
Speaker 1: I would, but this way it would be nice to
Speaker 1: have a trade relationship with China that is more imbalanced
Speaker 1: than currently. But the fact is that trade deficits or
Speaker 1: surpluses in this case deficits really are The economists will
Speaker 1: have models that demonstrate this, that there is between what
Speaker 1: we save and what we spend, because what we if
Speaker 1: we spend a lot more, the economy grows and we
Speaker 1: we import more from abroad, and then we have to
Speaker 1: borrow the money to make up the difference, which is
Speaker 1: why we're able and why we have to in effect
Speaker 1: sell more farm bonds, the far the bonds, some more
Speaker 1: bonds abroad, and that essentially it means that we are
Speaker 1: increasingly in debt, not only to our own people, but
Speaker 1: if we're going to be borrowing more and more money,
Speaker 1: as we probably have to do to get the economy
Speaker 1: going and to deal with COVID relief, then we have
Speaker 1: to get some money to pay for the treasury. Someone
Speaker 1: has to buy these treasuries, and it comes from abroad,
Speaker 1: whether it comes from China which has not been buying
Speaker 1: a lot of treasuries lately, or other countries like Japan,
Speaker 1: which has where we're going to have a financial deficit
Speaker 1: and a trade deficit um if we do not generate
Speaker 1: a higher level of savings than before, and if we
Speaker 1: continue to borrow a lot of money as as we
Speaker 1: are now. So I'm not particularly worried about um this
Speaker 1: in the near term, but I think over the medium term,
Speaker 1: the key point for me is not so much the
Speaker 1: numbers of the deficit, but are we competitive in the
Speaker 1: key areas that are the essential twenty one century technologies
Speaker 1: that are going to be important from our own economic
Speaker 1: point of view, and other countries like China consider them
Speaker 1: important from a Chinese point of view. So it's our
Speaker 1: competitive strength in these new areas of technology and in
Speaker 1: manufacturing in general, and in services that are critical to me,
Speaker 1: not some numerical uh metric, but our competitive strengths. And
Speaker 1: that's where we have to put more money into science, technology, mathematics, physics,
Speaker 1: and and all the so called stems to make ourselves
Speaker 1: more competitive in a very competitive world. And we're we
Speaker 1: That means investing in education, That means more training, That
Speaker 1: means people who have not had the benefit of training
Speaker 1: and technology get opportunities to do that, which means improving
Speaker 1: the school system, not just very high quality schools like
Speaker 1: Wrong Science and Stuyvesant here in New York, but strengthening
Speaker 1: community college is strengthening schools and getting people energized about
Speaker 1: mathematics and physics and science and technology. Because we're competing
Speaker 1: with a lot of very competitive Chinese. If we want
Speaker 1: to compete, we have to have competitive workers and researchers
Speaker 1: and others in the United States. That's the challenge. Then,
Speaker 1: more to me, more than a given number, Can you
Speaker 1: break down the thinking on that a little bit more?
Speaker 1: For us? The idea that you can have a higher
Speaker 1: deficit and more spending as long as you are competitive,
Speaker 1: is it? Is it simply the return on investment? Well,
Speaker 1: and then it gets complicated because you if you have
Speaker 1: if you have large deficits for a sustained period of time,
Speaker 1: you're building up a lot of debt to other countries.
Speaker 1: Of course, you have to pay that debt. Now at
Speaker 1: the moment, it's not so hard to do because interest
Speaker 1: rates on treasuries, which is what foreign investors had to
Speaker 1: buy a lot of uh that interest rates quite low.
Speaker 1: When interest rates start going up, as now many predicts
Speaker 1: they will with all this borrowing. Then the debt servicing
Speaker 1: becomes a bigger burden, and it becomes a bigger burden
Speaker 1: to the federal government because it crowds out other programs,
Speaker 1: and it means the United States has to in effect
Speaker 1: pay more to other countries that will led us the money,
Speaker 1: which is money that's not spent here. So I think
Speaker 1: what Bob is saying is that my English degree did
Speaker 1: not really help this nation become more competitive. I should
Speaker 1: have majored in accounting. I knew it, or or science
Speaker 1: or something stem. You know, Bob, you mentioned the fiscal
Speaker 1: deficit and the federal debt and who's going to buy
Speaker 1: all these treasuries. I mean, obviously the Federal Reserve is
Speaker 1: the big the big buyer these days, you know, and
Speaker 1: sort of the notion of modern monetary theory has really
Speaker 1: picked up a lot of steam lately. People say, you know,
Speaker 1: don't don't fret over the debt and the deficit. Um,
Speaker 1: if you issue your own currency, you can always pay
Speaker 1: it back, that that sort of thing. Um. I'm guessing
Speaker 1: you're not in that that camp. I would assume, well, I,
Speaker 1: I you know, it's a time issue more than anything,
Speaker 1: I do think that we need while we're in this
Speaker 1: UH period of COVID and and a lot of people's
Speaker 1: lives are being disrupted, a lot of companies are closed
Speaker 1: and down, and there's a lot of pain the cities
Speaker 1: and states. And I want to add this as an
Speaker 1: important underlying underlying point. We're gonna need legislation that helps
Speaker 1: individuals who are harmed by the shutdown and by COVID.
Speaker 1: We're gonna need to help companies of a wide range
Speaker 1: of companies in fact, but particularly small and medium sized businesses.
Speaker 1: Many of them are being forced to shut down. We're
Speaker 1: going to We're gonna also need to help cities and states.
Speaker 1: They're absorbing a huge amount of the burden, you know,
Speaker 1: Medicaid and and and the states. This is a very
Speaker 1: expensive proposition in these states. Unlike the federal government, the
Speaker 1: states can't print money, and many of them are forbidden
Speaker 1: to have deficits by their constitutions, so they are having
Speaker 1: to lay off people. They're having to cut back on
Speaker 1: services that in an effect is particularly harmful to low
Speaker 1: end people. It is in New York and UH and
Speaker 1: and and and disadvantaged UH socioeconomic groups. So I think, UH,
Speaker 1: if money needs to be spent, obviously it shouldn't be
Speaker 1: spent wisely. But if money needs to be spent now
Speaker 1: UH to deal with these issues, it should be And
Speaker 1: I'm all for UH President elect Biden seem to be
Speaker 1: President Biden coming up with a bold spending program for
Speaker 1: COVID relief, for state and local governments and for other things.
Speaker 1: And I'm also of the view that UM infrastructure is
Speaker 1: critically important. Eisen Our understood this after the World A
Speaker 1: World War two in the Korean where he launched the
Speaker 1: Interstate Highway program. Why did he do this? Obviously we
Speaker 1: needed new highways, but he wanted to be able to
Speaker 1: create jobs for people who were coming back from the wars.
Speaker 1: So we're really a now in a similar situation where
Speaker 1: a lot of jobs have been lost. We've got to
Speaker 1: create new jobs, and we need to deal with people
Speaker 1: who were hurt by COVID, whose companies are being forced
Speaker 1: out of business, who are losing their jobs, and state
Speaker 1: and local governments in particular need a lot of help,
Speaker 1: and that should be a critical part of this built
Speaker 1: because these states and local governments, if they off people
Speaker 1: and they cut back on services, there's going to be
Speaker 1: a lot of social unrest in many of these cities
Speaker 1: and states. So, UM, that's the current environment. Said it
Speaker 1: was a timing issue. Over the longer term, UM, there
Speaker 1: needs to be a way of of paying back at
Speaker 1: least some I don't expect all, but at least some
Speaker 1: of the money that's been borrowed. Now. I don't think
Speaker 1: this is gonna be easy, and I don't really know
Speaker 1: that they're easy ways of doing it. In the past,
Speaker 1: there was you create a lot of inflation, and inflation
Speaker 1: enables the federal government to get more money because you
Speaker 1: people move up in the tax bracket, and then they
Speaker 1: can help pay off the debt. But I think for
Speaker 1: the moment, the reality is we're going to have a
Speaker 1: large debt for a long period of time and and
Speaker 1: big uh growth, high growth expectations or high inflationary expectations,
Speaker 1: or very substantial increases and taxes are probably not likely.
Speaker 1: And therefore we're going to probably have to learn to
Speaker 1: live with these deficits and the these debts and and
Speaker 1: perhaps deficits, but certainly debts. And the FED, as you
Speaker 1: pointed out earlier, is going to be putting more and
Speaker 1: more paper on its books, is going to be in
Speaker 1: effect printing more money. So the FED is going to
Speaker 1: have a very very high balance sheet for a long
Speaker 1: piod of time. And on modern monetary theory, um, whether
Speaker 1: one believes in it or not, and there it's controversial.
Speaker 1: The reality is the FED is forced into it because
Speaker 1: it has to lend at low rates because people need
Speaker 1: the money and may can't service debts at high rates
Speaker 1: federal government included, So the FED prints money um in
Speaker 1: effect buys bonds with at very low interest rates, which
Speaker 1: effectively is spreading money and UM. And that's gonna happen
Speaker 1: for a long time. If the Fed starts raising rates
Speaker 1: or rates started going up, all these people who are
Speaker 1: leveraged to low rates, companies, individuals, homeowners are going to
Speaker 1: start having to use a lot of the money they
Speaker 1: make to repay debts. It will slow the economy down.
Speaker 1: So the FED actually is sort of forced the position
Speaker 1: where it can't really allow rates to go too much
Speaker 1: because it was slowly economy down very quickly, and then
Speaker 1: the federal government would be at state local governments would
Speaker 1: be paying out more money, which means other programs would suffer.
Speaker 1: And I'd add one caveat However, and that is these
Speaker 1: low rates are very painful to savers, particularly the elderly,
Speaker 1: because they you know, they thought, gee, if I've if
Speaker 1: I've made twenty dollars in my life, I have two
Speaker 1: thousand dollars in savings I put in the bank, or
Speaker 1: I buy treasuries, I get a nice interest rates. That's
Speaker 1: what they thought several years ago. And I get a
Speaker 1: nice interest rate of maybe two or three percent. That's
Speaker 1: what a lot of people would have thought several years ago.
Speaker 1: But it turns out now that the interest rate that
Speaker 1: they get is you know, a fraction of that. And
Speaker 1: so for savers, particularly conservative or elderly people who've saved
Speaker 1: a lot of money, they're getting so little in return
Speaker 1: for their fixed income savings preticting treasuries. But also and
Speaker 1: then corporates, you know, I a great corporates that they're suffering.
Speaker 1: So the the longest rates maybe and are good for
Speaker 1: the overall economy, and and uh, the spending is very
Speaker 1: good for people, disadvantage people in cities and states, and
Speaker 1: we need more of it, but the low interest rates
Speaker 1: can be very disadvantageous too, conservative elderly savers, and we
Speaker 1: have to bear that mind. It's a it's a big
Speaker 1: cost for elderly conservative savers. All right, Mike, I think
Speaker 1: it's that time though. It absolutely is the time, Bob.
Speaker 1: This is our our fun time of the show where
Speaker 1: we talk about the craziest things we've seen in the market.
Speaker 1: This week started what that I'll get started with a
Speaker 1: one that came in from a listener. Uh. And again,
Speaker 1: you can call in your crazy ideas to us, your
Speaker 1: crazy things on the hotline, you can send them to
Speaker 1: us on Twitter. The absolute coolest way to do it
Speaker 1: is to send it to us over the Bloomberg terminal.
Speaker 1: And that's what Steve Kaminski of Jump Trading did. Very exclusive,
Speaker 1: though it is very it's an excuse love club. Yeah,
Speaker 1: I'm not gonna say that your chances are getting on
Speaker 1: the show or greater if you do it this way.
Speaker 1: But I'm I'm not saying it's not either. But he
Speaker 1: writes and says, love the pod you do with Sarah.
Speaker 1: Thanks for all the great market content, tent and context.
Speaker 1: I had to throw that in. I had to throw
Speaker 1: in the compliments and he points out this asset. Uh, Bob,
Speaker 1: you might have some thoughts on this. We like to
Speaker 1: talk about the alternative asset space in the Crazy Things,
Speaker 1: and Steve is pointing out a nineteen fifty two Michel
Speaker 1: Mickey Mantel baseball card just sold for now, let's play prices, right, Sarah,
Speaker 1: what are you paying for a nineteen fifty two Mickey
Speaker 1: Mantle baseball I can't guess because I've seen the numbers.
Speaker 1: It's not fair the numbers. You just see. If the numbers,
Speaker 1: what's your bid? Bob? I might pay hundred dollars maybe,
Speaker 1: Now let's hear what it is. I'm way low. I'm
Speaker 1: not a great stock picker. I'm not a baseball baseball
Speaker 1: card picker. Even better, even better, Bob, you would not
Speaker 1: win that auction. It went for five point two million.
Speaker 1: And as Steve says, how does a collectible how does
Speaker 1: a collectible card bubble pop? I don't know, I don't know,
Speaker 1: but five point two million for a piece of card boards?
Speaker 1: Remember the tool of Craze and Holland. People are paying
Speaker 1: millions of guilders for a tool of bulb um. So this,
Speaker 1: I can't say, this totally surprises me. But then the
Speaker 1: question is, if you're looking at five years was it,
Speaker 1: what is that tool of bulb or what is that
Speaker 1: baseball card game be worth? If it's worth well, you
Speaker 1: know what it might be if you were a toolip buyer, Um,
Speaker 1: five years from the time about the tool, it probably
Speaker 1: wasn't worth. It's a pretty unbelievable I also want to
Speaker 1: mention Mike brought up the podcast hotline, and I want
Speaker 1: to bring you that number in case you would like
Speaker 1: to give us a call that six four six three
Speaker 1: two four three four nine zero, leave us a message,
Speaker 1: and of course we might even play it on the show.
Speaker 1: And sorry, that was that was our listeners. I'm gonna
Speaker 1: give you my own crazy thing, which I promised was
Speaker 1: about bitcoin. Now, as journalists, obviously we're not supposed to
Speaker 1: give buy and sell recommendations on investments, and that's probably
Speaker 1: a good thing. Let's let's all be honest. Um. I
Speaker 1: think I'm safe in giving this one recommendation though, and
Speaker 1: that is, if you do buy bitcoin, and you store
Speaker 1: that bitcoin on your own personal hard drive that's password protected,
Speaker 1: do not forget the password okay tattooed on your arm.
Speaker 1: If you have to write it, write it down somewhere.
Speaker 1: That The Times had a story on a guy Bob
Speaker 1: who put all his bitcoin two million dollars worth of
Speaker 1: bitcoin and he he can't remember his password. No more pressure, Sarah,
Speaker 1: I can even outdo that though. Uh. Forbes had a
Speaker 1: story basically quoting the BBC about a guy in Wales
Speaker 1: who threw away his hard drive with three hundred million
Speaker 1: worth of bitcoin on it seven years ago. And he's
Speaker 1: been buggling the town in Wales, Newport, the city of
Speaker 1: Newport and Wales. He's been bugging them for years about
Speaker 1: letting him go explore. They're dump their landfill to try
Speaker 1: to find this hard drive. He's offered to give them
Speaker 1: I think a quarter of the of the hall if
Speaker 1: he can find it, so offering him seventy million if
Speaker 1: he if he lets him go and dig up this uh,
Speaker 1: this hard drive. Bob, what do you think would you?
Speaker 1: Would you be out there digging in the landfill for
Speaker 1: I thought about it, Sarah. If you, if you two
Speaker 1: will join me, we can we can split it up three. Well, yeah,
Speaker 1: we'll suit up, we'll get out there and get our
Speaker 1: little trash pickers. We'll be ready for it. And my
Speaker 1: hunch was read Mike, I do want to say our
Speaker 1: listener who did right in and it's at Chris M
Speaker 1: d d C same crazy thing as you this week said,
Speaker 1: it's definitely craziest things worthy forgotten password or the guy
Speaker 1: digging in the dump. I've never gotten password. It's pretty good,
Speaker 1: all right, Sarah, What do you have for craziest thing?
Speaker 1: All right? Well, you just made me think of one more,
Speaker 1: so I'll share two then one. Also on the bitcoin spectrum,
Speaker 1: Lindsay Lohan, Uh, someone paid her on CAMEO to hype
Speaker 1: up bitcoin. So all of a sudden, Lindsay Lohan is
Speaker 1: now out there hyping up bitcoin. But I the one
Speaker 1: that really got me this week was there's this company
Speaker 1: called zoom Metica. It's a pet medicine company. And I
Speaker 1: don't know if either of you actually watched Tiger King
Speaker 1: back in the early quarantine days. It was my obsession.
Speaker 1: I watched it every day, ripped through those Netflix episodes. Well,
Speaker 1: Carol Baskin of Tiger King was also paid on CAMEO
Speaker 1: to talk about this company's o Medico is a penny
Speaker 1: stock companies now up. This year, we saw more than
Speaker 1: one billion shares trade in a single day. I mean,
Speaker 1: just unbelievable the types of things that you see these days.
Speaker 1: They got their three d bucks worth for that. Oh yeah,
Speaker 1: no doubt about that. How about you, Bob, seen anything
Speaker 1: crazy this week? Uh? There are a lot of things
Speaker 1: that are crazy going on. I I must say this
Speaker 1: is one that I find difficult to answer because we
Speaker 1: at TINAM and trying to take a long term view
Speaker 1: of what's going on, and I try to go boy
Speaker 1: short term cziness, you can call it about crazies. We
Speaker 1: have a lot of research. We do the research about
Speaker 1: long term trends and how they affect our clients, and
Speaker 1: I sort of stay away from the short term issues
Speaker 1: that that are that are funny to talk about but
Speaker 1: don't really help to think about the kind of long
Speaker 1: term issues that we as investors, we as a company,
Speaker 1: we as a country you have to work on. So
Speaker 1: I'm a more long term inclient. But I always enjoy
Speaker 1: here in your h crazy things of the of the week.
Speaker 1: Thank you, Bob. I imagine your clients appreciate that approach
Speaker 1: to They're not going to be impressed by the by
Speaker 1: you digging in the dump looking for a bit qually
Speaker 1: hard drift. I don't think that well, of course, unless
Speaker 1: I find it in the first day or so, and
Speaker 1: then it's worth it. I think I'll of with the
Speaker 1: dumps of whales for the time being, but if you
Speaker 1: find it, let me out you'll be You'll be my
Speaker 1: first call. Absolutely hands down, but it is. It's been
Speaker 1: an absolute privilege having you on the show today, Bob Hormett.
Speaker 1: Thank you for joining us. Thank you for letting me
Speaker 1: participate in the show. It's always a fun show to
Speaker 1: be on, and I appreciate being What Goes Up. We'll
Speaker 1: be back next week. Until then, you can find us
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