1 00:00:00,080 --> 00:00:12,960 Speaker 1: Ye, Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keane. 2 00:00:13,480 --> 00:00:17,560 Speaker 1: Daily we bring you insight from the best in economics, finance, investment, 3 00:00:18,000 --> 00:00:23,480 Speaker 1: and international relations. Find Bloomberg Surveillance on Apple Podcasts, SoundCloud, 4 00:00:23,600 --> 00:00:32,240 Speaker 1: Bloomberg dot Com, and of course on the Bloomberg. Well. 5 00:00:32,280 --> 00:00:35,840 Speaker 1: An extraordinary day in Washington yesterday. I like what um 6 00:00:35,880 --> 00:00:39,080 Speaker 1: Axio says this morning, Jim vander High talking about American 7 00:00:39,159 --> 00:00:42,800 Speaker 1: politics Off the rails? Are Kevin surreally in Washington? Really 8 00:00:42,880 --> 00:00:46,960 Speaker 1: seconding that? The mystery of where we are to Thursday 9 00:00:47,159 --> 00:00:51,040 Speaker 1: with Judge Kavanaugh and the Deputy Attorney General as well. 10 00:00:51,280 --> 00:00:53,520 Speaker 1: We will stay focused on one of the great themes. 11 00:00:53,520 --> 00:00:56,080 Speaker 1: And we have a wonderful guest John this morning to 12 00:00:56,120 --> 00:01:00,000 Speaker 1: begin this conversation on our trade war, on our terror, 13 00:01:00,760 --> 00:01:03,440 Speaker 1: on our taxes, which I think is another word for tariffs. 14 00:01:03,480 --> 00:01:06,520 Speaker 1: Have I studied my Spence over the years. He is 15 00:01:06,560 --> 00:01:09,360 Speaker 1: Michael Spence of New York University and of course of 16 00:01:09,440 --> 00:01:12,480 Speaker 1: Laurea where the Acre Loft and Stiglets and a glorious 17 00:01:12,840 --> 00:01:14,959 Speaker 1: your What was it like to get on stage with 18 00:01:15,080 --> 00:01:20,200 Speaker 1: Acer Laft and Stiglets, were you guys on speaking terms? Oh? Absolutely, yeah, No, 19 00:01:20,280 --> 00:01:23,119 Speaker 1: we don't each other for years and been colleagues at 20 00:01:23,160 --> 00:01:27,280 Speaker 1: Harvard or Stanford. In my case with Joe um No, 21 00:01:27,520 --> 00:01:31,200 Speaker 1: it was a joyful occasion. It's a joyful occation right now, 22 00:01:31,360 --> 00:01:35,400 Speaker 1: President ge and uh Mr Trump, President Trump keeping up 23 00:01:35,480 --> 00:01:37,960 Speaker 1: good face. But the fact is, is your grievous rifts 24 00:01:38,040 --> 00:01:43,280 Speaker 1: between China in America. What is your observation of the 25 00:01:43,400 --> 00:01:46,440 Speaker 1: choice set, the set of ideas that the president has 26 00:01:46,600 --> 00:01:51,520 Speaker 1: right now? Well, you know, there's considerable debate about that, 27 00:01:51,560 --> 00:01:53,960 Speaker 1: but it looks like what the President in a fairly 28 00:01:54,000 --> 00:01:59,080 Speaker 1: confrontational ways renegotiating the terms of engagement with China and 29 00:01:59,160 --> 00:02:02,800 Speaker 1: other countries. Professor, is always great to get your insight 30 00:02:02,880 --> 00:02:05,040 Speaker 1: on things, and we're while aware that you also serve 31 00:02:05,080 --> 00:02:07,880 Speaker 1: as a consultant and advisor to some really big asset 32 00:02:07,880 --> 00:02:11,240 Speaker 1: managers like PIMCO. What are you telling them right now? 33 00:02:11,240 --> 00:02:14,560 Speaker 1: What are you advising them about the vulnerabilities emerging markets 34 00:02:14,800 --> 00:02:16,760 Speaker 1: off the back of this try dispute between the United 35 00:02:16,760 --> 00:02:22,280 Speaker 1: States and China. Well, there's considerable uncertainty about um the 36 00:02:22,320 --> 00:02:27,079 Speaker 1: impact that of the of the of the confrontation between 37 00:02:27,080 --> 00:02:29,920 Speaker 1: the United States and China on the emerging economies. And 38 00:02:30,000 --> 00:02:32,160 Speaker 1: I think the reason for that is it's just simply 39 00:02:32,200 --> 00:02:35,239 Speaker 1: too hard to figure out, or there's if you drew 40 00:02:35,280 --> 00:02:37,639 Speaker 1: a decision tree, there's too many branches on it to 41 00:02:37,720 --> 00:02:40,600 Speaker 1: kind of get to the end. But but it's certainly 42 00:02:40,600 --> 00:02:45,560 Speaker 1: true that the emerging economies have gotten themselves out of balance, 43 00:02:46,000 --> 00:02:50,760 Speaker 1: uh in the post crisis period with you know, things 44 00:02:50,800 --> 00:02:53,840 Speaker 1: that I at least thought were you know, mistakes that 45 00:02:53,880 --> 00:02:56,680 Speaker 1: wouldn't be made again, like borrowing and her and currency, 46 00:02:56,840 --> 00:03:01,280 Speaker 1: running large current account deficits, et cetera. Uh um, And 47 00:03:01,320 --> 00:03:04,480 Speaker 1: I was wrong about that. So there's some rebalancing. I 48 00:03:04,800 --> 00:03:08,760 Speaker 1: don't think it's it's it's fatal at this point, whether 49 00:03:09,720 --> 00:03:11,520 Speaker 1: you know that. One of the reasons it's hard to 50 00:03:11,560 --> 00:03:14,040 Speaker 1: figure out what the longer term effects are is one 51 00:03:14,080 --> 00:03:17,680 Speaker 1: of China's objectives is to be a positive influence in 52 00:03:17,720 --> 00:03:20,880 Speaker 1: the developing world. That's part of their game plan of 53 00:03:20,960 --> 00:03:25,360 Speaker 1: becoming a more influential country um our nation around the world. 54 00:03:25,440 --> 00:03:27,760 Speaker 1: And and so they're well on the way to doing that, 55 00:03:27,919 --> 00:03:31,200 Speaker 1: and China's engagement in terms of investment and other things 56 00:03:31,240 --> 00:03:35,200 Speaker 1: could could be um, you know, pretty positive, and a 57 00:03:35,200 --> 00:03:37,720 Speaker 1: lot of emerging economies, well, the ways they sort of 58 00:03:37,760 --> 00:03:40,400 Speaker 1: optimistic time out there at the moment, Professor, that might 59 00:03:40,440 --> 00:03:43,000 Speaker 1: be China shifts towards an easing boss and an easing 60 00:03:43,000 --> 00:03:46,360 Speaker 1: boss which could stimulate the emerging world. Do you have 61 00:03:46,440 --> 00:03:50,240 Speaker 1: that confidence? Do you share that optimism? Um? I think 62 00:03:50,320 --> 00:03:53,240 Speaker 1: it's there's some easing that's likely in the cards as 63 00:03:53,280 --> 00:03:55,880 Speaker 1: they try to buffer their economy. But that but for 64 00:03:55,920 --> 00:04:01,240 Speaker 1: the emerging economies, access to their technologies, like the digital technologies, 65 00:04:01,240 --> 00:04:04,640 Speaker 1: which are very advanced in China, access to the Chinese 66 00:04:04,680 --> 00:04:07,880 Speaker 1: market are really crucial things. So I think there's justified 67 00:04:08,520 --> 00:04:13,520 Speaker 1: optimism based on China's longer term objectives. Um, whether the 68 00:04:13,640 --> 00:04:19,040 Speaker 1: easing the short term, you know kind of monetary and 69 00:04:19,120 --> 00:04:23,440 Speaker 1: fiscal responses are particularly positive free ms, I'm not so sure. 70 00:04:23,640 --> 00:04:27,600 Speaker 1: You are an important insight professor on television. I want 71 00:04:27,640 --> 00:04:29,560 Speaker 1: to advance that forward on the radio. We've got the 72 00:04:29,600 --> 00:04:33,320 Speaker 1: advantage of doing that on a radio. In hindsight, which 73 00:04:33,400 --> 00:04:37,400 Speaker 1: is that we've gone awfully far in our multilateral world 74 00:04:37,720 --> 00:04:42,800 Speaker 1: and people are rebelling against the multilateral outcome. Did we 75 00:04:42,839 --> 00:04:47,760 Speaker 1: go too far? In a way? I think we did. Um. 76 00:04:47,760 --> 00:04:51,240 Speaker 1: You know, Danny Roderick is a very knowledgeable commentator on this, 77 00:04:51,320 --> 00:04:53,400 Speaker 1: and what Danny says is that for most of the 78 00:04:53,440 --> 00:04:56,200 Speaker 1: period where the GAT was the sort of the evolving 79 00:04:56,240 --> 00:05:02,920 Speaker 1: government structure. Um the principle was nations agreed provided it 80 00:05:02,960 --> 00:05:05,840 Speaker 1: looked like it was broadly beneficial by their own values 81 00:05:05,880 --> 00:05:09,240 Speaker 1: and standards. And at some point he associates it with 82 00:05:09,360 --> 00:05:13,920 Speaker 1: the ascendency of the w t O coming into existence, 83 00:05:14,760 --> 00:05:18,560 Speaker 1: the global the rules in the of the system became 84 00:05:18,720 --> 00:05:23,479 Speaker 1: you know, inviolable, and then countries had to adapt, you know, 85 00:05:23,560 --> 00:05:25,480 Speaker 1: to a system we agreed on, but you didn't get 86 00:05:25,480 --> 00:05:28,200 Speaker 1: the tinker with that with that system. And I think 87 00:05:28,839 --> 00:05:31,560 Speaker 1: that's the sense in which is how he would put 88 00:05:31,640 --> 00:05:34,440 Speaker 1: the proposition that we went too far. This is critical 89 00:05:34,440 --> 00:05:37,160 Speaker 1: because Danny Roderick and Brad DeLong I would also put 90 00:05:37,200 --> 00:05:40,279 Speaker 1: in this group have looked carefully at the bargain we 91 00:05:40,400 --> 00:05:43,600 Speaker 1: made and we didn't follow through on, and that we 92 00:05:43,720 --> 00:05:47,719 Speaker 1: said for labor that was crushed by international trade, we 93 00:05:47,760 --> 00:05:51,560 Speaker 1: would provide domestic support, and we didn't do that out 94 00:05:51,560 --> 00:05:55,159 Speaker 1: of NAFTA and frankly out of other trade agreements. If 95 00:05:55,200 --> 00:05:58,719 Speaker 1: that's a missing link, is there any political tone to 96 00:05:58,880 --> 00:06:04,040 Speaker 1: help labor it's crushed by the advantage, the societal advantages 97 00:06:04,080 --> 00:06:07,600 Speaker 1: of international trade. I don't see it. I don't see 98 00:06:07,600 --> 00:06:12,160 Speaker 1: any political oomph to help out retail or to help 99 00:06:12,200 --> 00:06:17,360 Speaker 1: out UH textile workers in in the Carolinas. I think 100 00:06:17,400 --> 00:06:22,039 Speaker 1: that's a fair observation. Tom. You know, I suspect we 101 00:06:22,120 --> 00:06:27,080 Speaker 1: may see a change in that UM if a large 102 00:06:27,120 --> 00:06:30,360 Speaker 1: contingent of Democrats get elected in the mid term elections, 103 00:06:30,400 --> 00:06:33,279 Speaker 1: because this is this kind of thing is clearly on 104 00:06:33,360 --> 00:06:35,880 Speaker 1: their agenda, and and we may go too far in 105 00:06:35,920 --> 00:06:39,440 Speaker 1: the other direction, UM and start knucking up market performance. 106 00:06:39,480 --> 00:06:42,599 Speaker 1: But but I think what you said is right. There's 107 00:06:42,600 --> 00:06:44,279 Speaker 1: been a lot of talk, but not a lot of 108 00:06:44,320 --> 00:06:46,800 Speaker 1: action on that front. Well, we gonna have to leave 109 00:06:46,800 --> 00:06:48,920 Speaker 1: it there. Michael Spence, thank you so much. The Laura 110 00:06:49,040 --> 00:06:52,239 Speaker 1: from New York University. I really can't say enough about 111 00:06:52,880 --> 00:06:55,600 Speaker 1: his work and Project Syndicate. I've made very clear through 112 00:06:55,640 --> 00:06:59,479 Speaker 1: the crisis, his essays have been crucial to making us 113 00:06:59,560 --> 00:07:03,120 Speaker 1: think for there on where we are within the crisis 114 00:07:03,240 --> 00:07:19,240 Speaker 1: and beyond. Right now Christopher Rone speaks to us was fatiguous, Chris, 115 00:07:19,280 --> 00:07:22,240 Speaker 1: there's like eight ways to go, always within technical analysis. 116 00:07:22,480 --> 00:07:25,400 Speaker 1: But your call on oil is so important. We have 117 00:07:25,480 --> 00:07:28,320 Speaker 1: to start with that. How do you determine a breakout? 118 00:07:28,400 --> 00:07:30,920 Speaker 1: You have a rising trend? I get that, But then 119 00:07:31,080 --> 00:07:34,040 Speaker 1: how do you know that the breakout is there? Well, 120 00:07:34,040 --> 00:07:36,080 Speaker 1: we have to put this in context of the trend, 121 00:07:36,120 --> 00:07:38,120 Speaker 1: like you say, Tom, and let's remember the last six 122 00:07:38,200 --> 00:07:41,920 Speaker 1: or seven months. Even as oil consolidated, it consolidated from 123 00:07:41,920 --> 00:07:45,280 Speaker 1: the benefit of an uptrend. Oil sideways for six or 124 00:07:45,280 --> 00:07:48,280 Speaker 1: seven months above the upward sloping Tuitter day moving average. 125 00:07:48,280 --> 00:07:51,960 Speaker 1: So we are inclined to believe the validity of this 126 00:07:52,080 --> 00:07:55,480 Speaker 1: breakout getting up through brand. We think low nineties maybe 127 00:07:55,880 --> 00:08:02,280 Speaker 1: the next target. Here talk in technological talk, what momentum means. 128 00:08:03,040 --> 00:08:06,400 Speaker 1: I've never understood that. You know, Rowe goals, I'm ving 129 00:08:06,440 --> 00:08:10,160 Speaker 1: all the other Newtonian mv we have. What does momentum mean? 130 00:08:10,280 --> 00:08:14,800 Speaker 1: The chart people, momentum uh clearly is an academic term. 131 00:08:14,840 --> 00:08:19,160 Speaker 1: As technicians we call it trend. It's simply rate of change. 132 00:08:19,720 --> 00:08:22,840 Speaker 1: I think when you look back at different factors that 133 00:08:22,920 --> 00:08:26,240 Speaker 1: have been proven to work over time, momentum is the 134 00:08:26,240 --> 00:08:28,840 Speaker 1: most reliable of those. What we know about momentum is 135 00:08:28,840 --> 00:08:30,920 Speaker 1: it's very mean learning in the short term, right, It's 136 00:08:31,000 --> 00:08:33,120 Speaker 1: very random in the short term, but very powerful over 137 00:08:33,160 --> 00:08:36,400 Speaker 1: the longer term. John, what's so important about this? John Farrell? 138 00:08:36,600 --> 00:08:40,480 Speaker 1: Is chrisop Ron nailed that, and that the trend is 139 00:08:40,679 --> 00:08:45,280 Speaker 1: your drift function. It's your momentum, not a further inertial 140 00:08:45,400 --> 00:08:48,640 Speaker 1: force from the trend. That's to me where a lot 141 00:08:48,720 --> 00:08:51,280 Speaker 1: of people get this wrong. Was that enough physics, John? 142 00:08:51,440 --> 00:08:54,400 Speaker 1: That was really impressive. Tom, Thank you, thank you. Can 143 00:08:54,440 --> 00:08:56,520 Speaker 1: we get to just how this old market has really 144 00:08:56,600 --> 00:08:59,280 Speaker 1: changed Chris in the last several years. Several years ago 145 00:08:59,440 --> 00:09:02,400 Speaker 1: someone told me think about the oil market as if 146 00:09:02,400 --> 00:09:04,760 Speaker 1: it has a ceiling, that once we get to sixty 147 00:09:04,840 --> 00:09:07,920 Speaker 1: sixty five, the crude comes online in the United States 148 00:09:07,960 --> 00:09:10,240 Speaker 1: and it drives prices lower. And now I'm just hearing 149 00:09:10,280 --> 00:09:13,000 Speaker 1: think about the crude market with a floor. We have 150 00:09:13,040 --> 00:09:15,120 Speaker 1: a supply risk story in the market. Now, how has 151 00:09:15,120 --> 00:09:17,120 Speaker 1: it changed that much? Why has it changed that much 152 00:09:17,120 --> 00:09:19,760 Speaker 1: in just a couple of years. Yeah, I would make 153 00:09:19,760 --> 00:09:22,040 Speaker 1: maybe two or three observations. I would say number one, 154 00:09:22,559 --> 00:09:25,800 Speaker 1: the idea that crude had a ceiling on it in 155 00:09:25,880 --> 00:09:28,160 Speaker 1: the mid sixties or low seventies, I think became a 156 00:09:28,240 --> 00:09:30,319 Speaker 1: very very consensus view. And as we know, what do 157 00:09:30,480 --> 00:09:33,120 Speaker 1: markets like to do, they like to challenge consensus views. 158 00:09:33,520 --> 00:09:39,120 Speaker 1: I think the big change from when oil was under 159 00:09:39,160 --> 00:09:42,320 Speaker 1: a lot of pressure that was a credit driven move. 160 00:09:42,400 --> 00:09:44,400 Speaker 1: If you look at energy sector credit, it was under 161 00:09:44,520 --> 00:09:47,280 Speaker 1: lots and lots of pressure uh during that two or 162 00:09:47,320 --> 00:09:50,320 Speaker 1: three year period. That has been different over the last 163 00:09:50,360 --> 00:09:53,239 Speaker 1: eighteen months. Even though the energy stocks haven't been fantastic, 164 00:09:53,280 --> 00:09:57,840 Speaker 1: we haven't seen the systemic risk emerge from energy credit. 165 00:09:57,960 --> 00:10:01,600 Speaker 1: I think that's a very important distinguishing factor. You've had energy. 166 00:10:01,679 --> 00:10:04,440 Speaker 1: How yield spreads actually make new loads this week. I 167 00:10:04,480 --> 00:10:07,760 Speaker 1: think that is support of both for oil price itself 168 00:10:08,080 --> 00:10:11,320 Speaker 1: and for the energy stocks in particular. So you believe 169 00:10:11,360 --> 00:10:13,559 Speaker 1: there's discipline in the credit market now, Chris, that was 170 00:10:13,600 --> 00:10:16,040 Speaker 1: absent a couple of years ago. It certainly reflects that. 171 00:10:16,160 --> 00:10:18,320 Speaker 1: And at the end of the day, I am very 172 00:10:18,360 --> 00:10:22,480 Speaker 1: reluctant to embrace the equities when credit conditions are weakening. 173 00:10:22,720 --> 00:10:26,000 Speaker 1: So I certainly welcome the improvement that we've seen, most 174 00:10:26,040 --> 00:10:28,360 Speaker 1: notably over the last six months. Even as oil was 175 00:10:28,400 --> 00:10:31,959 Speaker 1: consolidating this year, credit conditions were still stable. That is 176 00:10:32,000 --> 00:10:34,240 Speaker 1: an asset for the stocks. Let's go back to the 177 00:10:34,240 --> 00:10:37,720 Speaker 1: equity markets and the fundamental people will notice the narrowness 178 00:10:37,760 --> 00:10:41,040 Speaker 1: of the market, only selected stocks really doing well. How 179 00:10:41,040 --> 00:10:44,040 Speaker 1: do you fold that into technical analysis? You look at sectors, 180 00:10:44,320 --> 00:10:47,240 Speaker 1: you look at individual charts. But how do you take 181 00:10:47,440 --> 00:10:52,480 Speaker 1: the Apple Amazon effect into what you're doing? Tom? I 182 00:10:52,480 --> 00:10:54,040 Speaker 1: have to say I think that's one of the most 183 00:10:54,200 --> 00:10:59,200 Speaker 1: overstated fallacies of two thousand and ten. This market is 184 00:10:59,240 --> 00:11:02,040 Speaker 1: not as narrow as commonly described. Let me give you 185 00:11:02,080 --> 00:11:04,920 Speaker 1: three iterations of the SPS. We know the cap weighted 186 00:11:05,040 --> 00:11:07,199 Speaker 1: SMP is at new highs. That's the index we look 187 00:11:07,200 --> 00:11:10,400 Speaker 1: at every day. Well, the equally weighted SMP is also 188 00:11:10,480 --> 00:11:14,360 Speaker 1: at new highs, as is the reverse weighted SMP. So 189 00:11:14,440 --> 00:11:17,320 Speaker 1: if all your large weights Apple, Amazon, Facebook become your 190 00:11:17,360 --> 00:11:20,200 Speaker 1: smallest weights, that index is still making new high so 191 00:11:20,520 --> 00:11:24,160 Speaker 1: it's difficult for me to buy. The market is dangerously 192 00:11:24,280 --> 00:11:28,160 Speaker 1: narrow story when all these different iterations of the index 193 00:11:28,200 --> 00:11:30,640 Speaker 1: are actually making new highs. And what we did recently 194 00:11:30,960 --> 00:11:34,080 Speaker 1: we looked at a distribution of Russell one thousand returns 195 00:11:34,120 --> 00:11:37,400 Speaker 1: by market cap. Believe it or not, it's the second 196 00:11:37,440 --> 00:11:40,120 Speaker 1: and third quintiles, the belly of the market that has 197 00:11:40,200 --> 00:11:43,240 Speaker 1: actually outperformed this year. So that is not where you 198 00:11:43,280 --> 00:11:46,560 Speaker 1: find your biggest stock. So I think this story, Um 199 00:11:46,840 --> 00:11:49,280 Speaker 1: that it's only four or five names leading this market 200 00:11:49,720 --> 00:11:51,960 Speaker 1: is just partently false. Chris, for anyone that might have 201 00:11:51,960 --> 00:11:53,800 Speaker 1: missed what you just said. Are you essentially saying that 202 00:11:53,880 --> 00:11:56,120 Speaker 1: if you make every single stock on the SMP five 203 00:11:56,200 --> 00:11:59,240 Speaker 1: hundred had exactly the same contribution to the overall index 204 00:11:59,559 --> 00:12:02,400 Speaker 1: as the next stalk that disanquity markets, that a record high. 205 00:12:02,440 --> 00:12:04,720 Speaker 1: Yes it is. And even if you take it one better, 206 00:12:05,160 --> 00:12:08,240 Speaker 1: if you make Apple, Amazon, Facebook, Google, JP Morgan your 207 00:12:08,280 --> 00:12:11,640 Speaker 1: smallest weights, um, the SMP is still at an all 208 00:12:11,720 --> 00:12:14,400 Speaker 1: time high. So this idea that it's narrow, I I 209 00:12:14,520 --> 00:12:16,760 Speaker 1: just think it is not supported by the facts. Tom. 210 00:12:16,800 --> 00:12:19,120 Speaker 1: I don't think people recognize that. I don't have many 211 00:12:19,120 --> 00:12:20,599 Speaker 1: people come on this show with us at least and 212 00:12:20,640 --> 00:12:23,240 Speaker 1: say that, did I No, I don't think so. I 213 00:12:23,960 --> 00:12:26,680 Speaker 1: think that you know. The hallmark of what Chris is 214 00:12:26,720 --> 00:12:30,440 Speaker 1: doing is just go through the data, go through the sectors. 215 00:12:30,520 --> 00:12:33,360 Speaker 1: Where's the anomaly right now? Where's the distinction within the 216 00:12:33,440 --> 00:12:36,240 Speaker 1: thirty page power point? Did you do? I think what's 217 00:12:36,280 --> 00:12:40,720 Speaker 1: most timely right here, perhaps and maybe most underappreciated, is 218 00:12:40,920 --> 00:12:43,360 Speaker 1: the extent to which the industrial stocks have improved over 219 00:12:43,360 --> 00:12:46,679 Speaker 1: the last three months. You have big bell weather names, 220 00:12:46,679 --> 00:12:50,680 Speaker 1: whether it's Caterpillar or Bowing, or Emerson Electric or Parker Hanaffan, 221 00:12:51,120 --> 00:12:54,760 Speaker 1: that has meaningful that have meaningfully improved over the last 222 00:12:54,840 --> 00:12:57,480 Speaker 1: ninety days. I think that is underappreciated here by a 223 00:12:57,520 --> 00:12:59,840 Speaker 1: lot of investors. I mean that's critical because these are 224 00:13:00,040 --> 00:13:03,720 Speaker 1: not you know, fifteen price to sales, eight times cash flow, 225 00:13:04,320 --> 00:13:07,120 Speaker 1: you know, thirteen times eve Dost stocks. They're like, there's 226 00:13:07,160 --> 00:13:11,719 Speaker 1: still are they They're not cheap, right, but I think 227 00:13:11,720 --> 00:13:14,439 Speaker 1: they're Caterpillar at one point this year was trading six 228 00:13:14,520 --> 00:13:16,800 Speaker 1: or seven times forward arting. So just to put it 229 00:13:16,840 --> 00:13:18,640 Speaker 1: in a little bit of context, and you think about 230 00:13:18,679 --> 00:13:21,240 Speaker 1: some of these names, at one point or another in 231 00:13:21,400 --> 00:13:25,319 Speaker 1: two thousand eighteen, all of those stocks have been correlated 232 00:13:25,320 --> 00:13:27,360 Speaker 1: to the emerging market trade. So the fact that they 233 00:13:27,360 --> 00:13:29,560 Speaker 1: have botted and turn up, does that tell us that 234 00:13:29,640 --> 00:13:32,000 Speaker 1: maybe e M is poised to improve. You're a little 235 00:13:32,000 --> 00:13:34,160 Speaker 1: bit something to think about going forward. Christopher Wrong, Thank 236 00:13:34,160 --> 00:13:36,839 Speaker 1: you so much for strtigaus research today. Just important work, 237 00:13:36,880 --> 00:13:50,439 Speaker 1: particularly that I thought an oil to ninety barreled. There 238 00:13:50,520 --> 00:13:54,280 Speaker 1: is Facebook, there is Instagram, and then there's Sarah Ponza 239 00:13:54,520 --> 00:13:57,520 Speaker 1: with a combination of these two. And it's not only 240 00:13:57,559 --> 00:14:00,920 Speaker 1: two guys from Instagram leaving. A lot of are leaving 241 00:14:00,960 --> 00:14:04,160 Speaker 1: Facebook right right. It is quite a shake up at Facebook. 242 00:14:04,200 --> 00:14:07,040 Speaker 1: But what's really standing out is Instagram because Instagram has 243 00:14:07,040 --> 00:14:09,800 Speaker 1: just been such a growing area for Facebook and it 244 00:14:09,840 --> 00:14:12,960 Speaker 1: has become more and more important. So people are saying that, Okay, well, 245 00:14:13,000 --> 00:14:15,480 Speaker 1: if the CEOs or the founders I mean of Instagram 246 00:14:15,480 --> 00:14:18,120 Speaker 1: are now leaving, what does that mean for the importance 247 00:14:18,120 --> 00:14:21,720 Speaker 1: of Instagram going forward for Facebook? But either way, Facebook 248 00:14:21,800 --> 00:14:23,920 Speaker 1: is down to percent this morning, so we'll have to 249 00:14:23,920 --> 00:14:27,120 Speaker 1: see more going forward. Sticking in the same type of space, 250 00:14:27,160 --> 00:14:29,320 Speaker 1: if you look at Square, it's a mobile payment company. 251 00:14:29,440 --> 00:14:31,080 Speaker 1: This is run by Jack Dorsey, who of course is 252 00:14:31,120 --> 00:14:34,160 Speaker 1: also the CEO of Twitter. Square is actually up two 253 00:14:34,160 --> 00:14:36,080 Speaker 1: and a half percent this morning. Now. An analyst over 254 00:14:36,120 --> 00:14:38,920 Speaker 1: at Namura Incident put out a note saying, well, Square 255 00:14:38,920 --> 00:14:41,760 Speaker 1: should probably be the newest member of the fan complex. 256 00:14:42,000 --> 00:14:46,000 Speaker 1: The analysts also raises Chrice Target. Yeah, so adding Facebook, 257 00:14:46,080 --> 00:14:50,000 Speaker 1: adding Amazon, Netflix, Google, So they're saying that it's shaken 258 00:14:50,040 --> 00:14:52,080 Speaker 1: up space. It should be in there anyways, helping the price. 259 00:14:52,080 --> 00:14:54,600 Speaker 1: We've got a Scena, so one of the retailers that 260 00:14:54,680 --> 00:14:57,920 Speaker 1: owns brands including dress bar And and and Taylor Loft Justice. 261 00:14:57,960 --> 00:15:00,560 Speaker 1: Those brands might be better known ven A Sena, but 262 00:15:00,600 --> 00:15:03,440 Speaker 1: the stock is up eighteen percent today. After reporting killer 263 00:15:03,480 --> 00:15:06,520 Speaker 1: earnings yesterday after the close that beat estimates. They also 264 00:15:06,560 --> 00:15:09,440 Speaker 1: had its first comparable sales growth in three years, and 265 00:15:09,480 --> 00:15:11,600 Speaker 1: then til rate. It's been in the news the past 266 00:15:11,680 --> 00:15:14,160 Speaker 1: week or so, up sixteen percent, well until Ray this 267 00:15:14,200 --> 00:15:18,000 Speaker 1: morning said it's successfully exported medical marijuana to Australia to 268 00:15:18,000 --> 00:15:20,680 Speaker 1: distribute to children who suffered from epilepsy. So it was 269 00:15:20,720 --> 00:15:22,680 Speaker 1: down the past three days. Investors are using this to 270 00:15:22,760 --> 00:15:24,880 Speaker 1: snap those losses get into the stock. Hillery up six 271 00:15:25,040 --> 00:15:27,400 Speaker 1: percent this morning. A few upgrades and downgrades for you 272 00:15:27,600 --> 00:15:29,960 Speaker 1: work Eva now. This is a company that provides cloud 273 00:15:29,960 --> 00:15:32,760 Speaker 1: and mobile software. It's based out of Iowa. Up fourteen 274 00:15:32,760 --> 00:15:35,840 Speaker 1: percent after it was upgraded at Bear to an outperform. 275 00:15:35,960 --> 00:15:39,320 Speaker 1: Science Applications International also known as s A i C. 276 00:15:39,840 --> 00:15:42,840 Speaker 1: This is an enterprise technology company, upgraded to a buy 277 00:15:42,920 --> 00:15:46,400 Speaker 1: from hold at Jeffrey's. It is down one percent actually, 278 00:15:46,440 --> 00:15:49,520 Speaker 1: and Heritage Crystal Cleaning cleaning services company. It was upgraded 279 00:15:49,520 --> 00:15:52,920 Speaker 1: to an outperformed from neutral at Beard as well. Thank you. 280 00:16:05,600 --> 00:16:09,280 Speaker 1: Joining us now is Patrick Gregory of Bloomberg Law. He 281 00:16:09,360 --> 00:16:12,040 Speaker 1: covers the Supreme Court for his Patrick you know, with 282 00:16:12,080 --> 00:16:15,080 Speaker 1: all of this back and forth over the nomination of 283 00:16:15,200 --> 00:16:18,560 Speaker 1: Brent Kavanaugh. It's possible to forget that the Supreme Court 284 00:16:18,840 --> 00:16:22,240 Speaker 1: is going to be open for business in October, and 285 00:16:22,280 --> 00:16:24,280 Speaker 1: I'm wondering if you could tell us what is on 286 00:16:24,320 --> 00:16:28,160 Speaker 1: the docket and what should we be looking for. Well, um, 287 00:16:28,200 --> 00:16:31,240 Speaker 1: that's true. And even Thursday, we're gonna get some orders 288 00:16:31,280 --> 00:16:34,920 Speaker 1: and cases that could grant review or deny review in 289 00:16:34,960 --> 00:16:38,560 Speaker 1: some important cases. One case I'm covering involves a high 290 00:16:38,560 --> 00:16:41,160 Speaker 1: school coach who was praying on a football field and 291 00:16:41,320 --> 00:16:43,840 Speaker 1: was suspended for that. So that's the case the court 292 00:16:43,880 --> 00:16:47,160 Speaker 1: could grant review in and then uh, in October. It's 293 00:16:47,160 --> 00:16:49,960 Speaker 1: really gonna be It's not, um, a whole lot of 294 00:16:49,960 --> 00:16:53,120 Speaker 1: hot button issues. UM need October term. But we'll have 295 00:16:53,200 --> 00:16:56,040 Speaker 1: to see alright, So not a lot of hot button issues. 296 00:16:56,080 --> 00:16:58,920 Speaker 1: So does it matter then whether the Supreme Court has 297 00:16:58,920 --> 00:17:02,600 Speaker 1: a full complement of justices? Um, of course it matters 298 00:17:02,600 --> 00:17:05,600 Speaker 1: to the parties involved into some extent. But I would 299 00:17:05,640 --> 00:17:07,760 Speaker 1: I would say that the real deadline here is going 300 00:17:07,800 --> 00:17:12,959 Speaker 1: to be November midterms. Why is that Well, because if 301 00:17:13,040 --> 00:17:16,280 Speaker 1: Kavanaugh doesn't get confirmed, you look at that scenario and 302 00:17:16,440 --> 00:17:20,800 Speaker 1: you could really have, um, the Democratic voters be galvanized 303 00:17:20,880 --> 00:17:24,919 Speaker 1: by a chance to block block the nominee. What do 304 00:17:24,960 --> 00:17:26,840 Speaker 1: they do with the next nominee? I mean, I don't 305 00:17:26,840 --> 00:17:29,040 Speaker 1: want to, you know, create a news flow here and 306 00:17:29,280 --> 00:17:32,359 Speaker 1: then Mr Kavanaugh. You know, I saw one person sayd 307 00:17:32,400 --> 00:17:35,840 Speaker 1: I believe he's innocent until proved guilty. But assuming Mr 308 00:17:35,960 --> 00:17:40,080 Speaker 1: Kavanaugh in some form steps aside, what would you presume 309 00:17:40,160 --> 00:17:43,000 Speaker 1: from the next nominee? I mean, is the is the 310 00:17:43,040 --> 00:17:48,360 Speaker 1: process forever changed? I think we are certainly in new 311 00:17:48,480 --> 00:17:51,000 Speaker 1: territory here, and that's why a lot of people say 312 00:17:51,000 --> 00:17:54,400 Speaker 1: that there will be pressure on the president to appoint 313 00:17:54,760 --> 00:17:57,800 Speaker 1: a woman, and there are a number of qualified women 314 00:17:57,920 --> 00:18:00,280 Speaker 1: on his Supreme Court shortlist. A lot of people are 315 00:18:00,320 --> 00:18:02,480 Speaker 1: talking about Amy Barrett and there, and there are a 316 00:18:02,480 --> 00:18:06,080 Speaker 1: couple of others. As far as the cases that you 317 00:18:06,240 --> 00:18:10,320 Speaker 1: described that the Supreme Court will be hearing, are they 318 00:18:10,440 --> 00:18:15,239 Speaker 1: able to put off important or contentious cases until they 319 00:18:15,280 --> 00:18:18,159 Speaker 1: get a full complement of justice. They have a lot 320 00:18:18,240 --> 00:18:21,320 Speaker 1: of freedom over over when they schedule oral arguments and 321 00:18:21,359 --> 00:18:26,200 Speaker 1: things like that. So sure, again, looking at the Supreme 322 00:18:26,240 --> 00:18:30,280 Speaker 1: Court and the retiring judges is well, I mean, it's 323 00:18:30,880 --> 00:18:33,280 Speaker 1: it might right that in the history of the Court, 324 00:18:33,920 --> 00:18:37,399 Speaker 1: this is an exceptionally fluid moment in terms of not 325 00:18:37,560 --> 00:18:40,960 Speaker 1: only bodies coming in such as Judge Kavanaugh, but also 326 00:18:41,040 --> 00:18:43,879 Speaker 1: the idea of what retirements could be just in the 327 00:18:43,920 --> 00:18:48,919 Speaker 1: next twelve months. Absolutely, you know, Ruth Bader Ginsburg is 328 00:18:48,960 --> 00:18:52,200 Speaker 1: certainly getting up there in terms of years plants. Thomas 329 00:18:52,240 --> 00:18:54,200 Speaker 1: has been on the Court since I was a kid, 330 00:18:54,880 --> 00:18:57,560 Speaker 1: and yeah, it's you know, who knows what could happen. 331 00:18:57,720 --> 00:19:00,159 Speaker 1: There could be another vacancy there and we just don't now. 332 00:19:00,359 --> 00:19:02,879 Speaker 1: I'll thank you so much, Patrick, We greatly appreciate that 333 00:19:02,920 --> 00:19:16,000 Speaker 1: in the Supreme Court. Pim Fox in time came from 334 00:19:16,000 --> 00:19:19,840 Speaker 1: the Bloomberg Interactive Broker studios in New York. It is 335 00:19:19,920 --> 00:19:23,760 Speaker 1: five thousand three or miles south out of New York, 336 00:19:23,800 --> 00:19:28,080 Speaker 1: out of JFK or Newark, and you wander across Venezuela. 337 00:19:28,160 --> 00:19:32,440 Speaker 1: Then you really wander across the Amazon in Brazil down 338 00:19:32,480 --> 00:19:35,880 Speaker 1: to Argentina. If you're lucky, you're on American Airlines flight. 339 00:19:37,119 --> 00:19:40,119 Speaker 1: And nobody has done this in Bloomberg more than Eric Shatzka, 340 00:19:40,280 --> 00:19:44,200 Speaker 1: who has spent major time in Buenos Areas. I want 341 00:19:44,240 --> 00:19:46,800 Speaker 1: to talk about the Central Bank resignation in your interview 342 00:19:46,880 --> 00:19:49,400 Speaker 1: yesterday with Mr MacRae, where I know he was managing 343 00:19:49,720 --> 00:19:52,600 Speaker 1: the message and that how are the people of Buenos 344 00:19:52,640 --> 00:19:55,560 Speaker 1: Aires and Argentina doing? I mean, they're the ones living 345 00:19:55,600 --> 00:19:58,520 Speaker 1: this crisis. Pay so out right now thirty eight point 346 00:19:58,600 --> 00:20:01,440 Speaker 1: six four, We're gonna make another dash to forty. How 347 00:20:01,440 --> 00:20:06,320 Speaker 1: are the people of Argentina doing? Uh? With difficulty? It's 348 00:20:06,359 --> 00:20:10,160 Speaker 1: like tangible right. Inflation tom is at the highest level 349 00:20:10,600 --> 00:20:15,520 Speaker 1: in Macari's presidency. The last monthly figure was almost thirty 350 00:20:17,160 --> 00:20:21,560 Speaker 1: and it's heading up. Inflation is getting worse better, The 351 00:20:21,560 --> 00:20:25,480 Speaker 1: economy is getting worse before it's getting better. The best 352 00:20:25,640 --> 00:20:29,040 Speaker 1: Mr Macri could do was to say that he was 353 00:20:29,080 --> 00:20:32,040 Speaker 1: hopeful the thanks to the weakness and the pay so 354 00:20:32,400 --> 00:20:35,680 Speaker 1: and the juice that it's giving exports, the Argentine economy 355 00:20:35,800 --> 00:20:39,159 Speaker 1: might start turning around, might come out of recession in 356 00:20:39,200 --> 00:20:42,760 Speaker 1: the second quarter of twenty But didn't. They just imposed 357 00:20:42,800 --> 00:20:47,440 Speaker 1: tariffs on exports of wheat and soybeans. There are some 358 00:20:48,160 --> 00:20:53,360 Speaker 1: he calls them temporary emergency export taxes, but those are 359 00:20:53,400 --> 00:20:58,720 Speaker 1: being put in place to try and restore a budgetary balance. 360 00:20:59,520 --> 00:21:02,959 Speaker 1: This is you know, he is fighting fires. It's like 361 00:21:03,080 --> 00:21:05,000 Speaker 1: it's like being in the midst of It's like being 362 00:21:05,000 --> 00:21:07,960 Speaker 1: in the rockies. This summer right there, wildfires everywhere you look. 363 00:21:08,200 --> 00:21:10,639 Speaker 1: Before we get to the central banker, what does Madame 364 00:21:10,720 --> 00:21:12,760 Speaker 1: Legarde in the I m F want They're going to 365 00:21:12,840 --> 00:21:15,159 Speaker 1: write a big check. President Trump will say America is 366 00:21:15,200 --> 00:21:18,000 Speaker 1: writing a check. Is a conduit through I am And 367 00:21:18,040 --> 00:21:20,159 Speaker 1: to your point, Macary said that he has had a 368 00:21:20,160 --> 00:21:23,719 Speaker 1: lot of support. This wouldn't be happening without American support. 369 00:21:23,760 --> 00:21:27,680 Speaker 1: That goes without saying, of course, but that wants to 370 00:21:27,720 --> 00:21:30,960 Speaker 1: get dinner Daniels tonight, what I want to know, Eric is, 371 00:21:31,200 --> 00:21:33,840 Speaker 1: and this is critical, what does the I m F 372 00:21:34,040 --> 00:21:40,960 Speaker 1: want this time around of the Argentinean crisis? What's the 373 00:21:41,000 --> 00:21:43,359 Speaker 1: I m F. What What we learned yesterday in the 374 00:21:43,400 --> 00:21:47,520 Speaker 1: conversation that I had with Macary on television and we 375 00:21:47,640 --> 00:21:50,480 Speaker 1: subsequently had with him for an additional half an hour 376 00:21:50,600 --> 00:21:53,520 Speaker 1: behind the scenes on the record, I should add, is 377 00:21:53,560 --> 00:21:56,720 Speaker 1: that this agreement that he is talking about, this new 378 00:21:56,760 --> 00:21:59,000 Speaker 1: agreement with the I m F, which in theory is 379 00:21:59,040 --> 00:22:02,119 Speaker 1: going to span the size of the program from fifty 380 00:22:02,119 --> 00:22:05,720 Speaker 1: billion to something else and accelerate disbursements from the fund 381 00:22:05,720 --> 00:22:09,880 Speaker 1: to Argentina, is going to involve a change in monetary policy. 382 00:22:09,920 --> 00:22:13,800 Speaker 1: Tom would and maybe this gets us to Luis Caputo 383 00:22:13,920 --> 00:22:18,240 Speaker 1: resigning from the central banking Argentina. Would Argentina be changing 384 00:22:18,280 --> 00:22:20,960 Speaker 1: the way that it manages the economy on its own 385 00:22:21,480 --> 00:22:24,560 Speaker 1: or is this a stipulation? I think it's reasonable to ask, 386 00:22:24,600 --> 00:22:31,400 Speaker 1: if not, to conclude this stipulation didn't go there? Are 387 00:22:31,400 --> 00:22:34,960 Speaker 1: you going there and saying this is a stipulation from who? Investors? 388 00:22:35,119 --> 00:22:37,960 Speaker 1: Or I am f Well, what Macari told us yesterday 389 00:22:38,280 --> 00:22:40,520 Speaker 1: the report and again this was I have to emphasize 390 00:22:40,560 --> 00:22:42,800 Speaker 1: this was not on television. He did talk about a 391 00:22:42,880 --> 00:22:46,280 Speaker 1: change in monetary policy coming, He didn't go into a 392 00:22:46,320 --> 00:22:50,800 Speaker 1: lot of detail. He said subsequently that the central bank 393 00:22:50,840 --> 00:22:55,200 Speaker 1: needs to revamp these are his words, revamped monetary policy, 394 00:22:55,240 --> 00:22:58,760 Speaker 1: that the explanation for this would be coming in several weeks. 395 00:22:58,800 --> 00:23:02,800 Speaker 1: But there was a wreck ignition that manipulating a single 396 00:23:02,880 --> 00:23:08,000 Speaker 1: interest rate was not effectively managing the Argentine economy. Is 397 00:23:08,040 --> 00:23:11,040 Speaker 1: this a conclusion that Louis Caputo came to on his own? 398 00:23:11,080 --> 00:23:14,760 Speaker 1: Remember this is an independent central bank ostensibly. Was this 399 00:23:14,840 --> 00:23:19,000 Speaker 1: a conclusion that Federico Sturtzenegger, his predecessor who stepped down 400 00:23:19,920 --> 00:23:22,240 Speaker 1: three months ago. Did he stepped out of his own volition? 401 00:23:22,920 --> 00:23:27,200 Speaker 1: We don't know. Um came to on his own. It's 402 00:23:27,240 --> 00:23:30,639 Speaker 1: not clear now that we have the central bank governor 403 00:23:30,760 --> 00:23:34,840 Speaker 1: resigning suddenly only three months into his job, in the 404 00:23:34,880 --> 00:23:38,280 Speaker 1: midst of a negotiation with the i m F, during 405 00:23:38,320 --> 00:23:40,520 Speaker 1: which we learned from the President of the country that 406 00:23:40,560 --> 00:23:43,840 Speaker 1: there will be a new monetary policy agreed to as 407 00:23:43,880 --> 00:23:47,200 Speaker 1: part of this expanded aid package. There are a number 408 00:23:47,240 --> 00:23:48,879 Speaker 1: of dots that we can start to connect. Don't you 409 00:23:48,920 --> 00:23:54,119 Speaker 1: think pace was weaker shaker talks that's the effect? Well, Eric, 410 00:23:54,720 --> 00:23:57,199 Speaker 1: I guess I want to try to connect this to 411 00:23:57,280 --> 00:24:01,200 Speaker 1: the larger theme of confidence and credibility, because if you're 412 00:24:01,240 --> 00:24:05,000 Speaker 1: going about an austerity program at the same time as 413 00:24:05,000 --> 00:24:07,400 Speaker 1: you just described that that they have at least last 414 00:24:07,440 --> 00:24:13,480 Speaker 1: measured thirty five inflation, they have a devaluing currency, they 415 00:24:13,520 --> 00:24:17,320 Speaker 1: have a variety of challenges that were unmet under previous administrations. 416 00:24:18,119 --> 00:24:23,879 Speaker 1: Where does this leave their credibility? Well, let's just start 417 00:24:23,880 --> 00:24:27,080 Speaker 1: with where the credibility is now. Let's forget about where 418 00:24:27,080 --> 00:24:30,159 Speaker 1: the credibility is going to be after this I m 419 00:24:30,240 --> 00:24:33,800 Speaker 1: F package is formally announced and the markets have a 420 00:24:33,880 --> 00:24:37,879 Speaker 1: chance to react to it. The credibility is in tatters. 421 00:24:38,160 --> 00:24:41,920 Speaker 1: Part of the problem in Argentine over the past five 422 00:24:41,960 --> 00:24:45,320 Speaker 1: months is that the government has done such a terrible 423 00:24:45,400 --> 00:24:49,160 Speaker 1: job sitting expectations. So not only has it set expectations 424 00:24:49,200 --> 00:24:53,840 Speaker 1: too aggressively, it has dramatically underperformed the expectations it has created. 425 00:24:54,520 --> 00:24:57,040 Speaker 1: Let's begin with the fact that starting the year, the 426 00:24:57,119 --> 00:25:01,280 Speaker 1: Argentine government told the people of Argentine that economic growth 427 00:25:01,320 --> 00:25:04,680 Speaker 1: would accelerate to three percent and inflation would come down 428 00:25:04,920 --> 00:25:07,240 Speaker 1: to fifteen percent by the end of the year. We 429 00:25:07,280 --> 00:25:10,840 Speaker 1: know where inflation is now, running north of and probably 430 00:25:10,840 --> 00:25:15,960 Speaker 1: close to forty. We know that the economy has entered recession. Yes, don't. 431 00:25:16,480 --> 00:25:20,480 Speaker 1: They suffered, in his words, the worst drought in fifty years. Yes, 432 00:25:20,520 --> 00:25:23,840 Speaker 1: there was an emerging markets crisis that probably contributed to 433 00:25:23,840 --> 00:25:26,199 Speaker 1: the dramatic weakening of the pace. So but to go 434 00:25:26,280 --> 00:25:31,200 Speaker 1: to Tim's Pim's point, Tom about credibility Pim. On August 435 00:25:33,400 --> 00:25:36,840 Speaker 1: Mauricio Macri, the president, was on national television talking to 436 00:25:36,960 --> 00:25:41,359 Speaker 1: Argentine's about the need for an accelerated I m F 437 00:25:41,640 --> 00:25:48,919 Speaker 1: program saying that we had it. He said, almost have 438 00:25:48,960 --> 00:25:53,959 Speaker 1: an agreement, the agreement. Agree. Stop stop there, what are 439 00:25:53,960 --> 00:25:56,280 Speaker 1: you the former mayor of New York. You're talking Spanish now, 440 00:25:56,560 --> 00:25:59,080 Speaker 1: I'm Bloomberg. Spence is only one guy that can do that, 441 00:25:59,320 --> 00:26:02,320 Speaker 1: and his name's the building Eric Shatsker. Quickly here, this 442 00:26:02,400 --> 00:26:06,760 Speaker 1: is important. Frame what Argentina is for our American audience. 443 00:26:06,960 --> 00:26:10,040 Speaker 1: It's a million miles away. It's it's something out of 444 00:26:10,359 --> 00:26:12,920 Speaker 1: Eva Parona and all that we are wrong and wrong, 445 00:26:13,000 --> 00:26:16,560 Speaker 1: wrong in our stereotypes. What's the so what of Argentina? 446 00:26:16,720 --> 00:26:22,199 Speaker 1: Is it a diverse economy? Most people's fair concept of 447 00:26:22,240 --> 00:26:27,280 Speaker 1: a Latin American nation. Why it's broadly educated, University education 448 00:26:27,400 --> 00:26:31,119 Speaker 1: is free, there's a large middle class. Argentina is the 449 00:26:31,200 --> 00:26:35,560 Speaker 1: second largest economy in Latin America, and if I'm not mistaken, 450 00:26:35,600 --> 00:26:38,920 Speaker 1: the second the largest grain exporter. We know it because 451 00:26:38,960 --> 00:26:42,560 Speaker 1: of its beef. But this is as European a country 452 00:26:42,600 --> 00:26:46,440 Speaker 1: as there is in Latin America. Probably in you know, 453 00:26:46,560 --> 00:26:49,440 Speaker 1: in the current brilliant it's probably looks a lot more 454 00:26:49,440 --> 00:26:53,400 Speaker 1: like Italy than it does Brazil. Michael, are you gonna 455 00:26:53,440 --> 00:26:55,399 Speaker 1: do the news in Spanish? Can we can we do 456 00:26:55,440 --> 00:26:57,800 Speaker 1: that today? I mean Shatsker is talking Spanish here, I can't. 457 00:26:58,040 --> 00:27:01,840 Speaker 1: I can barely do it in English. Now we noticed recently, 458 00:27:01,840 --> 00:27:05,160 Speaker 1: and I'll just offer this that in Argentina, at least 459 00:27:05,200 --> 00:27:08,280 Speaker 1: in Buenos Aires, has the highest per capita number of 460 00:27:08,359 --> 00:27:11,720 Speaker 1: psychologists per pose where you come up with this stuff, 461 00:27:11,800 --> 00:27:15,560 Speaker 1: Eric Shatsker, Thank you for your continuing reporting, Mr McCree 462 00:27:15,680 --> 00:27:26,280 Speaker 1: and the unique features of Argentina. This is Bloomberg. Thanks 463 00:27:26,280 --> 00:27:30,560 Speaker 1: for listening to the Bloomberg Surveillance podcast. Subscribe and listen 464 00:27:30,760 --> 00:27:36,080 Speaker 1: to interviews on Apple Podcasts, SoundCloud, or whichever podcast platform 465 00:27:36,200 --> 00:27:40,520 Speaker 1: you prefer. I'm on Twitter at Tom Keane before the podcast. 466 00:27:40,560 --> 00:27:44,080 Speaker 1: You can always catch us worldwide. I'm Bloomberg Radio.