Speaker 1: Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keane. Along
Speaker 1: with Jonathan Ferrell and Lisa Brownwitz Jaily. We bring you
Speaker 1: insight from the best and economics, finance, investment, and international relations.
Speaker 1: Find Bloomberg Surveillance on Apple Podcast, Suncloud, Bloomberg dot com,
Speaker 1: and of course on the Bloomberg terminal. There are these
Speaker 1: large financial institutions and Alison Williams joins us. Now, Alison,
Speaker 1: I figured out today the City Group's revenues three thirty
Speaker 1: four million a day. That often yeah, okay, I did
Speaker 1: some fancy yeah you know, you taught me the f
Speaker 1: A function, and uh, you know it's They're ginormous. And
Speaker 1: what I saw Allison Williams in their view for two
Speaker 1: thousand twenty two is page fourteen, which is a layout
Speaker 1: of their technology to come. How does any buddy and
Speaker 1: banking compete with Lorie Beer in twelve billion dollars a
Speaker 1: year in technology? Well, and I think that the big
Speaker 1: number of seventies seven billion for next year from JP
Speaker 1: Morgan is even more significant. And and the way they're
Speaker 1: competing is they're spending. And I thought that, um, you know,
Speaker 1: the JP Morgan call is going on now. But Jamie
Speaker 1: Diamonds sort of finished up last quarter by saying, we're
Speaker 1: going to spend whatever it takes to compete with all
Speaker 1: these folks in our space. And I think the numbers
Speaker 1: today are showing that they are committed to doing that.
Speaker 1: I think that's might be a reason why people are
Speaker 1: reacting negatively in the short term. But I think, you know,
Speaker 1: the not just the articulated commitment, but seeing it in
Speaker 1: the numbers like that shows you that they are going to, um,
Speaker 1: you know, focus on building their positions, defending their positions.
Speaker 1: Allison talked to us about loan growth out there. UM,
Speaker 1: I know that's one of the key issues you and
Speaker 1: your bank colleagues were focusing on this quarter. What we've
Speaker 1: seen from some of the big banks so far looks
Speaker 1: about in line. I think Bank America will be the
Speaker 1: interesting one next week because they're they've been sort of
Speaker 1: the more bullish one, and the commercial side of things
Speaker 1: is really where we're getting the lift, and I think
Speaker 1: where we're sort of the most bullish on the card
Speaker 1: side of things. You know, payments still continue to be
Speaker 1: elevated and people are spending, so consumers are healthy. It's
Speaker 1: just that they have money in their pockets to pay
Speaker 1: off those balances. So I think that's that's great for
Speaker 1: the economy. It's great for the credit outlook for banks, UM.
Speaker 1: But less borrowing means less interesting come related to that
Speaker 1: bar what's the sweat factor on traditional credit cards? I mean,
Speaker 1: there's like a firm and they're doing something with Amazon
Speaker 1: and you know all this stuff better than me, Allison,
Speaker 1: But like the are the big banks worried about the
Speaker 1: end of charge cards or they're like, so what? I
Speaker 1: think the big banks are aware of by things like
Speaker 1: by now pay later, and you know they have competing products,
Speaker 1: but I would argue that, you know, the distribution at
Speaker 1: point of sale UM is obviously what's given the big
Speaker 1: lift to that product. So I think it is something
Speaker 1: that they're watching. I would keep in mind that it's
Speaker 1: it's still very small in the scheme of things, UM
Speaker 1: so growing very rapidly. But you know, so if you
Speaker 1: go from one percent share of a market to two
Speaker 1: percent share of a market, UM, you know, that's small
Speaker 1: for the person that owns the lion share of that market,
Speaker 1: but for that fast grow where they're doubling their revenue, right, So, UM,
Speaker 1: I think it is something that um As I said,
Speaker 1: the banks are aware of their not completely dismissing it.
Speaker 1: And I think that goes to um as I said,
Speaker 1: sort of the higher spending and and the focus. That's
Speaker 1: that's what's different. I think that this time around, if
Speaker 1: we looked back to sort of the evolution of the internet,
Speaker 1: you know, way long ago. Uh, I think, you know,
Speaker 1: initially banks were very dismissive of that, and then they
Speaker 1: sort of saw the progress and they saw um, they
Speaker 1: saw sort of things chip away at things that they
Speaker 1: could have done themselves. And they're they're much more aware
Speaker 1: and committed this time to making sure that they stay competitive. Alison,
Speaker 1: how are my friends on the trading desk doing this
Speaker 1: quarter of the equity desk, the fixed income desk, the commodities,
Speaker 1: How are they doing? Because they had such a rip
Speaker 1: roaring they did, and I think they're doing fine. Um.
Speaker 1: You know, trading came in a little bit weaker than expected,
Speaker 1: but but I would I would say it's fine, especially
Speaker 1: you know last you know four Q twenty, as you said,
Speaker 1: was was exceptionally strong. But the big winners are your
Speaker 1: friends in the investment banking department, especially the M and
Speaker 1: A bankers. Fees super strong, um coming in even better
Speaker 1: than expected. Uh, there's momentum I think carrying through at
Speaker 1: the moment of you know, we watched the environment um.
Speaker 1: A big spike in volatility would be the biggest risk
Speaker 1: to disrupting that. Obviously, any correction to ask A prices
Speaker 1: might might hamper that. But but for now things are
Speaker 1: strong and you know that's leading to the higher compensation
Speaker 1: cost that you know, the war for talent and that's awesome.
Speaker 1: Left too expensive. Saw that phrase on top livel of
Speaker 1: Ellison Williams on here soon work about that. That's awesome
Speaker 1: coming Memorial Day, but it's serious, Elison Williams, thank you
Speaker 1: so much and goodbye. We get perspective from Scott Clemen's
Speaker 1: chief investment strategist at Brown Brothers Hareman. Scott, you know,
Speaker 1: it sort of felt like a year so far and
Speaker 1: maybe it's at least a quarter here in the first
Speaker 1: fourteen fifteen days of the year. Have you changed your
Speaker 1: outlook since twee No, I don't think so, Tom. I
Speaker 1: think what we've seen in the first handful of weeks
Speaker 1: of this year, if anything, is a microcosm of how
Speaker 1: the year is likely to unfold. If anything. The surprise
Speaker 1: in one was the relative lack of market volatility. We
Speaker 1: only have seven trading sessions last year in which the
Speaker 1: SMP five index moved by two percent or more up
Speaker 1: or down in either direction, and usually in a given
Speaker 1: a year we have about twenty days like that. So
Speaker 1: we're cautioning our clients they, given all the transitions taking place,
Speaker 1: and we could talk about that for the rest of
Speaker 1: the day, that there is likely to be more market
Speaker 1: volatility in two. That may be a risk, that may
Speaker 1: be disruptive and anxiety inducing. It's also an opportunity as
Speaker 1: well for investors. How do you use it that as
Speaker 1: an opportunity, Scott Well, Really, when you get that dislocation
Speaker 1: between price and value is what a discipline, long term
Speaker 1: patient investor can exploit. And what that really is is
Speaker 1: not so much knowing something more than the market or
Speaker 1: knowing something more than another trader. It's having a different
Speaker 1: time frame for making that investment. So if you see
Speaker 1: a company stumble in the near term of your confident
Speaker 1: in the long term fundamental value direction of the business,
Speaker 1: that near term stumble, maybe a near term EPs miss,
Speaker 1: a product thiss, whatever it may be, is more of
Speaker 1: an opportunity than it is a threat. So I want
Speaker 1: to go to the story of the moment. As the
Speaker 1: banks this morning, they're just killing it. Yet today the
Speaker 1: stoke performance more than ten percent based self through in
Speaker 1: the morning. Some people am willing to chase this. What
Speaker 1: advice do you give them, uh, Jonathan, to take the
Speaker 1: same kind of long term approach. This is an environment
Speaker 1: which ought to be better and better for banks. Banks
Speaker 1: are certainly undervalued relative to where they've been over a
Speaker 1: long run. Higher interest rates ought to be beneficial for banks.
Speaker 1: But as you and chnologist reported on City Bank the
Speaker 1: City Group, there are a lot of moving parts within
Speaker 1: the banks, be the regulatory or be they a market
Speaker 1: environment where the revenues are coming from higher costs of
Speaker 1: employment when they can get back to offices, etcetera, etcetera, etcetera.
Speaker 1: So it is an environment which is going to be
Speaker 1: a great deal of holatility. I'd stay focused on the
Speaker 1: longer term. Well focusing on the longer term though, and
Speaker 1: this really goes to the heart of the moment, which
Speaker 1: is what is being priced in from an interest rate perspective,
Speaker 1: from a way to increased perspective, how do you determine
Speaker 1: that to decide whether or not to say City Group
Speaker 1: down three having a really rough time of it over
Speaker 1: the last twelve months relative to other banks, let's go.
Speaker 1: I think the the the interest rate environment is probably
Speaker 1: the most important economic backdrop over the course of this year,
Speaker 1: and it's really important. This is a subtle nuance, but
Speaker 1: it's an important one. The important thing for markets, the
Speaker 1: important thing for banks in particular, is not that interest
Speaker 1: rates are rising, but why they're rising. And that's admittedly subjective,
Speaker 1: and the push and pull and markets, even on a
Speaker 1: day to day, hour to hour basis, might be precisely that,
Speaker 1: on one hand, of interest rates are rising because people
Speaker 1: are more confident in the economic outlook, the durability of
Speaker 1: the labor market, the sustainability of corporate earnings, etcetera, etcetera.
Speaker 1: That's a benign backdrop in which banks can do well,
Speaker 1: in which the market can do well. If, on the
Speaker 1: other hand, the market concludes that interest rates are rising
Speaker 1: because the FED has lost a grip on inflation and
Speaker 1: they're behind the curve and you're rushing to catch up,
Speaker 1: that's a rather negative or rather disruptive outlook. And I
Speaker 1: think there's gonna be a lot of push and pull
Speaker 1: back and forth on that as the year unfolds, we
Speaker 1: even see that to my earlier comment to Tom as
Speaker 1: a microposit within individual training sessions, I'm confident that when
Speaker 1: all is said and done, this transition of economic leadership
Speaker 1: away from policy support, government support, monetary policy back to
Speaker 1: the more traditional fundamental drivers of economic activity household spending
Speaker 1: to name the most important one, that will take place.
Speaker 1: But it is not a straight line between here and there.
Speaker 1: Let's thank you, sir as always skilled clements that the
Speaker 1: chief investment strategist at Brand Brothers Harriman, we get perspective
Speaker 1: now and from Dana Peterson, chief economists at the Conference Board,
Speaker 1: this is an important conversation and with a conference boards
Speaker 1: heritage of looking at the American consumer, go beneath the
Speaker 1: headline data. Dana, what is the American consumer telling you? Well,
Speaker 1: I think the American consumer is telling us that December
Speaker 1: was a really rough month. But let's think about this.
Speaker 1: When we look at October sales, they were really strong,
Speaker 1: so lots of people probably accelerated their holiday shopping. In fact,
Speaker 1: I went and bought all my toys in October UM,
Speaker 1: but we also had empty shelves and let's not forget omicron.
Speaker 1: It was a huge issue during December and many people
Speaker 1: probably were uh just not out there shopping because they
Speaker 1: were afraid of getting sick or they were getting sick
Speaker 1: in fact um. And indeed, we wouldn't be surprised if
Speaker 1: consumer confidence in January comes off from what we saw
Speaker 1: in December. But again that's a big function of omicron. Dana.
Speaker 1: The first point that you made empty shelves, how much
Speaker 1: is this a supply chain disruption story? And I just
Speaker 1: frankly supply story. If there wasn't the inventory to sell, well,
Speaker 1: I think it all factors in if you can't if
Speaker 1: there's no inventory, you can't clearly buy anything. And so
Speaker 1: we really need to watch metrics that tell us what's
Speaker 1: going on with inventories. And certainly when we look at
Speaker 1: other private measures, we didn't see some improvement in terms
Speaker 1: of of the movement of goods. But again arm across
Speaker 1: is a big issue, certainly in foreign goods that we're
Speaker 1: importing are challenged by zero COVID policies abroad, and then
Speaker 1: also even just getting things two shelves, um, we still
Speaker 1: have this huge backlog of ships uh takerships with with
Speaker 1: things that can't be unloaded, and even once they're unloaded, um,
Speaker 1: we can't get it to the stores because truckers are
Speaker 1: in short supply. One Bloomberg Blue viewer rights in and
Speaker 1: says have four kids, Santa had a rough time finding
Speaker 1: at things, so talking about how Santa is pursuing it
Speaker 1: from exactly the UK when I got over that same thing,
Speaker 1: I said chains are tougher and shuff online and it
Speaker 1: was intill. Sorry. Well, I'm sure that that will that
Speaker 1: will read really well across the family and baby Charlie.
Speaker 1: But there is an issue with if December was bad
Speaker 1: because of amacron, we haven't even peaked in the United
Speaker 1: States yet. When it comes to the virus, how bad
Speaker 1: is January could have pay well, certainly we could see
Speaker 1: some poor numbers in January, and at the conference board,
Speaker 1: we've already factored in a pretty weak first quarter, looking
Speaker 1: at two point two percent growth, which is pretty similar
Speaker 1: to what we saw in the third quarter, um with
Speaker 1: the delta variant. But you know, we're coming off a
Speaker 1: very strong quarter in general. Fourth quarter probably looked pretty good.
Speaker 1: We're gonna see a sad second first quarter this year,
Speaker 1: but then the second quarter should pick up as we
Speaker 1: get beyond AMCRON and certainly as in person services reopen
Speaker 1: and people can go out there and enjoy their lives.
Speaker 1: Dana a World Health organization as amicrons starting in South
Speaker 1: Africa and to go north to Botswana A November two
Speaker 1: thousand twenty one. You guys on the high ground on
Speaker 1: this does a conference board see like charge card dynamics,
Speaker 1: in entry dynamics into stores that really changed in December?
Speaker 1: Is there actual granular evidence of what we all felt, Well,
Speaker 1: we don't actually try that data, but um, I think that,
Speaker 1: you know, certainly the retail sales are reflecting what happened
Speaker 1: on the ground again for the reasons that that we've
Speaker 1: all been discussing. And you know. The good news though,
Speaker 1: is that in December, consumers were still kind of optimistic
Speaker 1: in terms of the future. They were still thinking that
Speaker 1: they're going to go on vacation within the next six months.
Speaker 1: They're looking to buy cars, appliances, clothing, you know, all
Speaker 1: that great stuff. And certainly, um, as Lisa mentioned earlier,
Speaker 1: consumers have the capacity to spend. Many people are working,
Speaker 1: people still have savings from the stimulus checks, Household balance
Speaker 1: sheets are in good shape, and so once we get
Speaker 1: past the omicron issue, which may be short lived. Certainly,
Speaker 1: as we saw in South Africa came in strong and
Speaker 1: then faded pretty quickly. We should probably get back to
Speaker 1: an environment where consumers feel comfortable spending. Dina, thank you
Speaker 1: as always to respond to that big down side surprise
Speaker 1: on retail. Sus Diana Pattison at the conference, Bolt, Oh,
Speaker 1: you know, I was out with the plague, and you know,
Speaker 1: Mrs Kame was really upset, and she goes, you know
Speaker 1: that were that rash on your face? I mean, what
Speaker 1: is that? And I said, you know, I said, well,
Speaker 1: you know, it's a case of lepto critosis. Um. She
Speaker 1: said lepto critosis. And I said, yeah, it's a bad,
Speaker 1: bad case of lepto critosis. And so I said, get
Speaker 1: Ash ellen care. So we're gonna talk to Ash ellen
Speaker 1: car right now about lepto critosis. Leptocretosis, folks, it's not
Speaker 1: what between your toenails. Lepto Critosis is when the markets
Speaker 1: are out of whack and the distribution is different of
Speaker 1: whatever is going on, and the tails get flatter fatter,
Speaker 1: I should say. And you that's where you hear about
Speaker 1: this phrase fat tails, which is quite talk. We talked
Speaker 1: to ash Allen Carro can translate this right now as
Speaker 1: the dispersion of what's out there, the cacophony of noise.
Speaker 1: We're seeing a crown and everything else. Has that created
Speaker 1: fatter tails with greater potential risk? Yes? Uh? Why why?
Speaker 1: I am familiar with liptocaturus. I'm not exactly sure I
Speaker 1: know how to spell it, but you're exactly right, Like,
Speaker 1: you have a lot of tail risk in the system now,
Speaker 1: and that tail risk can take one of two forms.
Speaker 1: It can be left tail risk, which is that bad tale,
Speaker 1: um or it could be a right tail risk, which
Speaker 1: is that good tale. And it really rests on the
Speaker 1: notion that everyone is focused on today of whether or
Speaker 1: not the US FED can strike that right balance between
Speaker 1: fighting inflation yet keeping growth intact. And if you're a
Speaker 1: betting man, um, and I am a betting man, the
Speaker 1: history is pretty bad. The track record is a FED
Speaker 1: striking that right balance is really really really bad. They
Speaker 1: just never has able been They've never been able to
Speaker 1: historically do to really balance that cause and effect correctly. Um. So, naturally,
Speaker 1: that's the worry on everyone's mind that the days of
Speaker 1: free money are coming to an end Um, the FED
Speaker 1: is going to increase borrowing costs in an economy which
Speaker 1: is fragile. UM. And today you saw retail sales numbers UM.
Speaker 1: You hear JP Morrigan's earnings report, UM that things aren't
Speaker 1: looking that good. Um. Is it a one time blip maybe,
Speaker 1: but it's something we have to pay attention to. And
Speaker 1: if they can strike that balance, then a right tail
Speaker 1: can unfold. Um. The FED is able to contain inflation
Speaker 1: which is killing people purchasing power um, and you could
Speaker 1: see consumption increase. UM. You could see UH credit continue
Speaker 1: to flow, you could see people take on leverage, an
Speaker 1: equity market shoot up. Another just we're just doing this
Speaker 1: for ash because we want to dazzle Im paul I
Speaker 1: went to the Bloomberg and looked at JP Morgan done
Speaker 1: ten dollars, having a difficult morning. JP Morgan down to
Speaker 1: two standard deviations of where it's been is down five
Speaker 1: point seven percent rounded out six percent from here from
Speaker 1: where we are right now, from where it was in
Speaker 1: the top band of standard deviation. It's a correction move.
Speaker 1: We would have to go down eleven percent from where
Speaker 1: we were to really show the bottom of a two
Speaker 1: standard deviation truth, nobody cares. I'm just doing it the
Speaker 1: dazzle Ash well, you know, Ash with the m I
Speaker 1: T He's got a PhD from U C. L A.
Speaker 1: I think he knows standard deviations. You know, he's okay
Speaker 1: with that stuff. Ash. A lot of your portfolio managers
Speaker 1: and your analysts and Janice probably haven't really had a
Speaker 1: lot of experience in a rising interest rate environment. What
Speaker 1: are you suggesting to them as they think about the
Speaker 1: next question? Great question, UM that this is a completely
Speaker 1: new regime, but it's a regime which is already priced in.
Speaker 1: So what you have to realize markets are efficient. The
Speaker 1: markets today are pricing in about two hundred or two
Speaker 1: increases in the overnight rate over the next two years.
Speaker 1: That's already being priced in. UM. That's exactly the same
Speaker 1: pace of the interest rate hikes that Powell and team
Speaker 1: UM underwent in two thousand seventeen. So the key question
Speaker 1: is are they going to hike faster and increase rates
Speaker 1: faster than what's already priced? Who knows that the baseline
Speaker 1: is a pretty aggressive baseline. I personally believe it's not
Speaker 1: going to happen because we're entering a completely new post.
Speaker 1: UM pandemic economy. UM. That economy is a new economy
Speaker 1: UM characterized by remote working, characterized the characterized by the
Speaker 1: rise of the suburbs. Character is buy a new endemic
Speaker 1: to add to the seasonal flu. So you have to
Speaker 1: realize the baseline is pretty aggressive. Nevertheless, if they do
Speaker 1: hike faster than that brace line, because inflation pressures really
Speaker 1: need to get into check, what should you do, UM, Well, naturally,
Speaker 1: as rates rise, fixed income holders are going to sell
Speaker 1: out of fixed income and look for other ways to
Speaker 1: capture yield. So think about high divided yielding stocks. That's
Speaker 1: a good rotational play. UM. Think about that left tail
Speaker 1: risks or those tail risks TOM that you articulated to.
Speaker 1: How do you hedge those tail rifts? The big tail
Speaker 1: downside tail risk to the system is an increase in
Speaker 1: real rates, so they sell off. We see an interest
Speaker 1: rates over the past couple of weeks, it's all due
Speaker 1: to the real rate increasing. So heads your real rates.
Speaker 1: Think about buying options on put options on tips UM
Speaker 1: to to hedge that left tail risk, which is not
Speaker 1: not just a left tail risk to tips, it's a
Speaker 1: left tail risk to all risky asset. You know one
Speaker 1: thing that concerns me. Hear in Paul Sweete is an
Speaker 1: old equity guy where he talks about yields up. Nobody cares.
Speaker 1: It's about price. Are we in a bond bear market?
Speaker 1: Or can you predict a bond bear market? Of our
Speaker 1: listeners have never been in It's hard. I don't think
Speaker 1: we're in a bond bear market. Um. I do believe
Speaker 1: that the feds hiking schedule is going to be gradual. Um,
Speaker 1: it's very unlikely they're going to hike more than what
Speaker 1: is it eight times over the next two years. So
Speaker 1: if they stay on course, that should be a non
Speaker 1: event um in terms of fixed income rates. But it
Speaker 1: can be actually a meaningful and significant event when it
Speaker 1: comes to equities because you likely will see a shift
Speaker 1: of your nominal interest rate being more real rate and
Speaker 1: less inflation. And more real rate is bad because at
Speaker 1: the end of the day, your pe ratio, which is
Speaker 1: a real ratio, right, prices are nominal, earnings are nominal,
Speaker 1: your real rate rises. This fantastic p expansion which tons
Speaker 1: of people have made tons of money off of, you
Speaker 1: start to compress. I mean, this is good. We gotta
Speaker 1: leave it their ash, We gotta you gotta Could you
Speaker 1: make a note kill? Can we get ashback on? I
Speaker 1: think we need to. I think the snow is pretty
Speaker 1: good out there in Denver. Ye, listen to you. You're
Speaker 1: trying to get the ski trip. Yes, we get a
Speaker 1: weekend brief from Andrew Pecks. He's professor of Rologists and
Speaker 1: Therapists for the Keen Dining Room table joins us today
Speaker 1: from Johns Hopkins and the Bloomberg School. There. Andy, this
Speaker 1: came up last night at the table. What's after a macron?
Speaker 1: What is after this variant? Well, you know, it's hard
Speaker 1: to predict exact what's going to happen with the with
Speaker 1: these variants were we can say with pretty good certainty
Speaker 1: that there will be more variants coming down the pipeline.
Speaker 1: But we really think that, you know, all Macron was
Speaker 1: a tremendous challenge to the current vaccines and the treatment regimens.
Speaker 1: And if we can handle all Macron, which in many
Speaker 1: ways when it comes to hospitalizations and the rates of hospitalizations,
Speaker 1: we are we probably are going to be in a
Speaker 1: good place to be able to deal with other surges
Speaker 1: and be able to limit them in the future. Where
Speaker 1: did Delta go? Delta is still around a little bit.
Speaker 1: We have a few people here in the hospital that
Speaker 1: are infected with Delta. Delta is at very low levels
Speaker 1: across the country, maybe ten percent of sequences. But all
Speaker 1: Macron has really come in and outpaced Delta and really
Speaker 1: become the dominant virus and an incredibly fast period of time. Andy,
Speaker 1: we're talking about economic momentum in the face of the
Speaker 1: A macron up swaying, and we've been talking about when
Speaker 1: we can expect it to be over. I'm curious about
Speaker 1: what you've observed about a five day isolation period, as
Speaker 1: the CDC guidance lays out as well as now the
Speaker 1: United Kingdom, is that proven to be the effective amount
Speaker 1: of time that people are contagious after which they can
Speaker 1: go back into circulation. The problem is is a very nuanced,
Speaker 1: good question. There is some data suggesting that if you've
Speaker 1: been vaccinated that after five days um you are very
Speaker 1: unlikely to be infectious. But all of that data was
Speaker 1: was generated with variants other than a macron, and we
Speaker 1: already know from some of the testing procedures some of
Speaker 1: the transmission of all macron that it's doing things a
Speaker 1: little bit differently than previous variants. So many scientists, including myself,
Speaker 1: really wanted to hear that five day incubation period ended
Speaker 1: with a negative antigen tests, because that would have really
Speaker 1: been strong evidence that you would be very unlikely to
Speaker 1: spread the virus if you went back to the work place.
Speaker 1: And although with other variants I would have said fine,
Speaker 1: but with a Macron things are a little different. Andy
Speaker 1: Tom started the conversation off saying, what comes after a Macron?
Speaker 1: And we're talking about bank earnings, We're talking about the
Speaker 1: return to work plans that were put on hold as
Speaker 1: we deal with this latest variant. What will return to work,
Speaker 1: return to party, return to restaurant look like once we
Speaker 1: are back to an endemic phase of this virus rather
Speaker 1: than pandemic. Well, if there's any bit of a silver
Speaker 1: lining right now, it's, Uh, it's it's becoming clear that
Speaker 1: if you've been vaccinated and you get an O Macron infection,
Speaker 1: your immune response afterwards is not only tremendously high, but
Speaker 1: it's also very broad, meaning that it recognizes all these
Speaker 1: previous variants that have come through. So there's suggestive data
Speaker 1: right now, uh, indicating that people who have gotten through
Speaker 1: this Amicron surge may end up with a really strong
Speaker 1: immune response. Afterwards, it's going to provide even more protection
Speaker 1: against whatever the next variant is. And if that's true,
Speaker 1: that could be a returning point in turn of in
Speaker 1: terms of dealing with this as as a pandemic versus
Speaker 1: something seasonal like influenza. Dr Pecrows, thank you so much
Speaker 1: for joining us today with JOHNS Hopkins at University. This
Speaker 1: is the Bloomberg Surveillance Podcast. Thanks for listening. Join us
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Speaker 1: the terminal. I'm Tom Keene and this is Bloomberg