WEBVTT - Surveillance: U.S. Jobs Report

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<v Speaker 1>Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keane. Along

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<v Speaker 1>with Jonathan Ferrell and Lisa Brownwitz Jay Ley, we bring

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<v Speaker 1>you insight from the best and economics, finance, investment, and

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<v Speaker 1>international relations. Find Bloomberg Surveillance on Apple Podcast, Suncloud, Bloomberg

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<v Speaker 1>dot com, and of course on the Bloomberg terminal. Joining

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<v Speaker 1>us now on this is Jeff Rosenberg, port folio manager

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<v Speaker 1>of the Systematic Multi Strategy Fund of black Rock. Jeff,

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<v Speaker 1>let's get straight to it, sir. You'll response to your reaction. Yeah,

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<v Speaker 1>I think the focus here is that the headline, while

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<v Speaker 1>a miss, is expected to be revised higher. We've had

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<v Speaker 1>a pattern for for a number of years now with

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<v Speaker 1>this calendar setup that December gets revised higher. You had

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<v Speaker 1>the revisions earlier adding to it. So I think the

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<v Speaker 1>market's looking past the disappointment on the headline. And as

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<v Speaker 1>you guys have highlighted, you know, the unemployment rate, the

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<v Speaker 1>labor force participation rate, and the average hourly earnings, you know,

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<v Speaker 1>are all about the lookthrough from the payroll report to

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<v Speaker 1>the outlook on inflation. And that's really the more important

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<v Speaker 1>story here for for payrolls. You know, we saw in

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<v Speaker 1>the Minutes earlier this week, the discussion about you know,

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<v Speaker 1>reaching maximum employment, full employment, and lift off, I think

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<v Speaker 1>that has been decided. So the kind of the wage

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<v Speaker 1>count is pretty clear. And we've had a lot of

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<v Speaker 1>evidence for a long time now that labor markets are

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<v Speaker 1>are are very strong. I think the issue is are

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<v Speaker 1>they too strong? And are they a contributor contributor to

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<v Speaker 1>the inflation story? And I think there's a little bit

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<v Speaker 1>of that in this report, and I think that's more

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<v Speaker 1>the takeaway for the market. Can you frame not the

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<v Speaker 1>certain nous of it, but Jeff Rosenberg, can you begin

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<v Speaker 1>to frame in your mind that we're heading for an

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<v Speaker 1>inverted twos tends spread? I mean, are we is this

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<v Speaker 1>the first discussion with particularly the regular household survey showing

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<v Speaker 1>six fifty job girls. Are we finally at a point

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<v Speaker 1>where we really have to begin to discuss potential curve

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<v Speaker 1>and vision with a two year yield up up up.

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<v Speaker 1>You know, Tom, it's a it's a very big question.

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<v Speaker 1>It's a question we we spent a lot of time

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<v Speaker 1>talking about. But the difference this time is the role

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<v Speaker 1>of the balance sheet, and and you know, when you

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<v Speaker 1>see how much the balance sheet has contributed to financial

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<v Speaker 1>conditions easing. Right, You look at that time series of

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<v Speaker 1>the balance sheet and it makes what was and you

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<v Speaker 1>were there with with me, you know, what we thought

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<v Speaker 1>in in uh in two thousand and eight was historic,

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<v Speaker 1>unprecedented balance sheet expansion, and what we see in this

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<v Speaker 1>balance sheet is it makes that period look tiny by comparison.

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<v Speaker 1>And so I think the difference in the kind of

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<v Speaker 1>traditional yield curve in version the bond market predicting the

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<v Speaker 1>FED overdes it yet again, and you're seeing some of

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<v Speaker 1>that in the bond market already. Is the the tool

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<v Speaker 1>and the uncertainty around how much will they use the

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<v Speaker 1>balance sheet to try to take some of that accommodation out.

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<v Speaker 1>You saw a lot of discussion of that in both

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<v Speaker 1>speeches and a bit in the minutes about you know,

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<v Speaker 1>trying to avoid that that very strong curve inversion and

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<v Speaker 1>using the balance sheet to try to tighten financial conditions

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<v Speaker 1>without the same kind of yield curb in version. So

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<v Speaker 1>I think it remains to be seen, and we still

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<v Speaker 1>have a lot of information to come from the FED

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<v Speaker 1>about the balance sheet normalization policy. Jeff, it's hard to

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<v Speaker 1>believe that we're just a fewer than two weeks into

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<v Speaker 1>the new year. It has been an exhausting period of

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<v Speaker 1>time in the first week of two. Has anything changed

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<v Speaker 1>your outlook given the fact that we've gotten the meeting minutes,

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<v Speaker 1>given the fact that we seem to see some support

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<v Speaker 1>for a very tight labor market in today's data, that

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<v Speaker 1>really you're going to actually adjust tweak your view for

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<v Speaker 1>the year ahead. Well, I think going into this year,

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<v Speaker 1>we had already had the view that this was a

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<v Speaker 1>significant set of turning points, right you. We knew that

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<v Speaker 1>from the meeting. We discussed it when I was on

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<v Speaker 1>a month ago, from the from the dots plot. What

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<v Speaker 1>we got out of the minutes was the narrative to

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<v Speaker 1>that change. And that narrative really laid out that the

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<v Speaker 1>FED recognizes they have a significant inflation problem on their hands.

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<v Speaker 1>And and now it's really about the market and the

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<v Speaker 1>FED figuring out how much intestinal fortitude does the Fed

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<v Speaker 1>have to tighten financial conditions, Because tightening financial conditions means

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<v Speaker 1>tighter financial conditions, i e. Lower stock prices, higher interest rates,

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<v Speaker 1>wider credit spreads. Uh. And what we've seen is very

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<v Speaker 1>little tolerance for financial conditions over tightening. And that's the

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<v Speaker 1>tricky part that the FED is gonna try to have

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<v Speaker 1>to wee here between wanting to take some of this

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<v Speaker 1>incredible post COVID crisis accommodation out of the market, take

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<v Speaker 1>some of the froth out of asset prices without overdoing it. Uh.

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<v Speaker 1>We don't have a really good experience for the ability

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<v Speaker 1>of of markets to to kind of calmly go through

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<v Speaker 1>a tightening cycle. And so I think what we've seen

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<v Speaker 1>in the first two weeks is a little bit of

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<v Speaker 1>a validation that is a very different market backdrop environment

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<v Speaker 1>than what we've had in the post COVID environment. Uh.

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<v Speaker 1>And so I think you have to go into portfolio

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<v Speaker 1>portfolio risk taking with that understood. Jeff thank you so

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<v Speaker 1>much for joining us today. Generous of you to be

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<v Speaker 1>with this. Jeffrey Rosenberg is with Black Rocks. This is

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<v Speaker 1>a joy. She is out of the combine at Washington

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<v Speaker 1>University of St. Louis. I think the Laura Douglas North

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<v Speaker 1>among others, Lawrence Meyer as well, Terrace Singlair Sinclair joins

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<v Speaker 1>us now from George Washington University or she is expert

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<v Speaker 1>in counting the data Tera, do you have any idea

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<v Speaker 1>how to count the data amid a pandemic. Is the

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<v Speaker 1>data that you see it, indeed, is the data that

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<v Speaker 1>we see on Bloomberg's surveilance every day. Is it truly believable? Well,

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<v Speaker 1>I mean, obviously there's a lot of complexity here. And

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<v Speaker 1>you know, when we're thinking about using data for modeling

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<v Speaker 1>or for forecasting, we're typically relying on the historical patterns

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<v Speaker 1>being applicable to today, and so it's really hard to

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<v Speaker 1>find historical patterns that makes sense when we're seeing such

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<v Speaker 1>novel events happening day to day and where we keep

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<v Speaker 1>using the word unprecedented over and over and over again.

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<v Speaker 1>But it is still the case that our statistical agencies,

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<v Speaker 1>you know, for today, the Bureau Labor Statistics, the numbers

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<v Speaker 1>that they're putting out, they're working very very hard to

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<v Speaker 1>put out the cleanest, clearest numbers that they can, and

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<v Speaker 1>it's still important to look at this information in order

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<v Speaker 1>to be able to have some site as to what's

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<v Speaker 1>going on terra The key question continues to be the

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<v Speaker 1>participation right. The fact that the participation rate did not

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<v Speaker 1>increase even as we saw the jobless rate fall to

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<v Speaker 1>the lowest going back to February of raises some alarm Bells.

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<v Speaker 1>Why is it that people are not going back into

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<v Speaker 1>the labor market and what could prop possibly bring them in.

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<v Speaker 1>What's your experience, both on the ground as well as

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<v Speaker 1>from an academic setting. Yeah, well, I mean, I think

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<v Speaker 1>we really have to think carefully about what the incentives

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<v Speaker 1>are for people to participate in the labor force right now.

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<v Speaker 1>And we still have a pandemic going on and that

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<v Speaker 1>is definitely holding back participation, both directly from concerns about

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<v Speaker 1>the virus, but also from other challenges. You're trying to

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<v Speaker 1>figure out childcare situation when you don't know when your

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<v Speaker 1>your child might test positive for the virus, you have

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<v Speaker 1>to care for others in your household in other ways.

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<v Speaker 1>That's also an additional constraint on labor force participation. And

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<v Speaker 1>we also have to remember we still have those long

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<v Speaker 1>demographic trends that are drawing down that overall lea reforce participation,

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<v Speaker 1>so we may never get back to leave beforce participation

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<v Speaker 1>rates we saw pre pandemic, because we've got the retirement

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<v Speaker 1>of the baby that was happening at the same time.

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<v Speaker 1>So this raises an issue of is this as good

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<v Speaker 1>as it gets and are we going to see for example,

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<v Speaker 1>wages increase much more than people are expecting because that

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<v Speaker 1>participation rate may not go up that much higher. As

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<v Speaker 1>you said, it may not ever get back to where

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<v Speaker 1>we saw a pre pandemic. What's your view on that. Well,

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<v Speaker 1>I still see this as a temporary maximum employment where

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<v Speaker 1>we are right now, where we may be close to

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<v Speaker 1>as far as we can get. But at the same time,

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<v Speaker 1>we may still see additional improvement once we get more

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<v Speaker 1>clarity about the long term UH situation with the virus. Tara,

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<v Speaker 1>thank you so much. Terris Sinclaire with George Washington University

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<v Speaker 1>today on some of the data nuances of this. Tiffany

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<v Speaker 1>Wilde is expert at time began she joins us now

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<v Speaker 1>from PIMCO. What a shock to get the rico Dona.

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<v Speaker 1>Note Tiffany that before holiday, before seasonal, before this, before that,

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<v Speaker 1>this was a very strong report. How strong was it? Yeah? Well,

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<v Speaker 1>good morning Tom and Paul. Um, you know, so, although

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<v Speaker 1>the headline number was a bit disappointing. Um, you know,

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<v Speaker 1>I just keep in mind that there are two surveys

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<v Speaker 1>underlying any payroll report, and the household survey, which isn't

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<v Speaker 1>given as the headline number. Um, you know, it was

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<v Speaker 1>actually quite strong, you know, and I think that really

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<v Speaker 1>is what the FOMC, for example, is going to be

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<v Speaker 1>focusing on. So they're going to be looking at the

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<v Speaker 1>six approximately six and fifty job genes um, which pushed

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<v Speaker 1>the unemployment rate down to three nine percent below their

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<v Speaker 1>estimates for kind of that long run level a proxy

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<v Speaker 1>for maximum employee it so you know, by by this measure,

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<v Speaker 1>we're sort of at maximum employment. Of course, inflation has

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<v Speaker 1>you know, um, you know, met their standard for hiking

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<v Speaker 1>interest rates, you know. So to me, this report just

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<v Speaker 1>solidifies after the minutes UM earlier this week, which which

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<v Speaker 1>I would argue that showed the Fed very focused on

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<v Speaker 1>upside risk to inflation UM and in a labor market

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<v Speaker 1>that's rapidly recovering that this just solidifies the March rate

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<v Speaker 1>hike that the market was already pricing in. Yeah, that's

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<v Speaker 1>kind of where I wanted to go, Tiffany. I mean,

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<v Speaker 1>you know, how do you think the FED will interpret

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<v Speaker 1>the data here today? Because even though the headline a

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<v Speaker 1>little bit disappointing relative to Consett, there's a lot of

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<v Speaker 1>positives underneath. Yeah, I mean so, so I think you know, again,

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<v Speaker 1>you always have to be really careful because UM, you know,

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<v Speaker 1>there can be statistical noise around any report, and I

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<v Speaker 1>think the establishment survey UM had a little bit of

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<v Speaker 1>that going on. So what what we kind of thought

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<v Speaker 1>also that was going to happen was that you had

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<v Speaker 1>establishments businesses right that kind of pulled full word hiring UM.

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<v Speaker 1>And I think that happened across a gain and that

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<v Speaker 1>what we saw was a pretty big surgeon hiring in October,

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<v Speaker 1>and that's been followed by UM, you know, a weaker

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<v Speaker 1>kind of weaker prince if you will, although two hundred

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<v Speaker 1>UM thousand jobs is still pretty strong, but weaker than

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<v Speaker 1>that prince UM in the months to follow. Now, I

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<v Speaker 1>think that will kind of wash out of the data

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<v Speaker 1>UM in January, but well, of course we'll have to

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<v Speaker 1>see what happened with oh Macron. I think the more

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<v Speaker 1>important thing here, though, is the household survey. You know,

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<v Speaker 1>it's very strong and and it it's been lagging over

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<v Speaker 1>the last year, but it's recently caught up, and I

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<v Speaker 1>think that reflects the fact that we've seen actually a

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<v Speaker 1>lot of establishments of of proprietors UM, you know, people

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<v Speaker 1>that you know aren't working in the more traditional UM

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<v Speaker 1>you know, kind of corporate establishment jobs and the household

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<v Speaker 1>survey picks that up, whereas establishment survey doesn't. You know. So,

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<v Speaker 1>I think that the household survey being very strong is

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<v Speaker 1>something that the fomc IS is really going to focus

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<v Speaker 1>on here, especially in the unemployment rate. Why don't we

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<v Speaker 1>focus on that? What is the history where media is

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<v Speaker 1>fixed aided by non farm payrolls traditionally two D thousand, MG,

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<v Speaker 1>we're gonna go to one fifty as a run, right,

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<v Speaker 1>we all got that wrong? And then you know, we

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<v Speaker 1>focus on that. Why don't we focus on the other survey?

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<v Speaker 1>David mal Passed when he was at bear Stearns focused

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<v Speaker 1>on that. Yeah, Well, I mean, I think traditionally, you know, well,

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<v Speaker 1>obviously most of the higher percentage of jobs in general

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<v Speaker 1>in the United States are through large corporates and and

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<v Speaker 1>and larger establishments UM. And so that survey, you know,

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<v Speaker 1>I think is a very good proxy UM. And in addition,

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<v Speaker 1>the household survey can be noisy, can suffer from you know,

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<v Speaker 1>kind of more statistical noise from months a month, but

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<v Speaker 1>that the pandemic, it does seem, has changed a lot

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<v Speaker 1>of how people are are working UM or not or

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<v Speaker 1>not working quite frankly. And one of the things I

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<v Speaker 1>think that has changed pandemic people prefer to have soldier triatorships. Right. So, So, Tiffany,

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<v Speaker 1>is I look at that average hourly earnings year on

0:12:56.760 --> 0:13:00.840
<v Speaker 1>your growth of four point seven? Is that wage inflation?

0:13:01.000 --> 0:13:04.520
<v Speaker 1>Is wage inflation is something that investors, maybe the Federal

0:13:04.600 --> 0:13:08.280
<v Speaker 1>Reserve needs to think about. Yeah, I mean I certainly

0:13:09.000 --> 0:13:12.560
<v Speaker 1>they cannot. I think they can't ignore the wage inflation

0:13:12.600 --> 0:13:15.880
<v Speaker 1>statistics that are they're coming out of this survey. UM.

0:13:16.000 --> 0:13:19.360
<v Speaker 1>And and although you know it's well known that it UM,

0:13:19.440 --> 0:13:22.080
<v Speaker 1>you know, there are some compositional effects that that have

0:13:22.480 --> 0:13:24.960
<v Speaker 1>you know that that sort of distort can distort these numbers.

0:13:25.360 --> 0:13:27.600
<v Speaker 1>You know. I think the bottom line is is that

0:13:27.679 --> 0:13:31.240
<v Speaker 1>wage inflation UM. You know, it's clearly strong for low

0:13:31.280 --> 0:13:35.200
<v Speaker 1>wage jobs UM. And I think it's potentially broadening out.

0:13:35.360 --> 0:13:39.120
<v Speaker 1>And that's really what the Fed cares about, UM, you know,

0:13:39.160 --> 0:13:42.040
<v Speaker 1>and in terms of of looking at longer term inflation

0:13:42.080 --> 0:13:45.880
<v Speaker 1>expectations and how they're filtering into the way people bargain

0:13:45.960 --> 0:13:48.920
<v Speaker 1>for jobs. UM, it's really they're they're really concerned with,

0:13:48.960 --> 0:13:52.000
<v Speaker 1>you know, is wage inflation really broadening out across sectors?

0:13:52.040 --> 0:13:55.400
<v Speaker 1>And and our businesses passing on, you know, further passing

0:13:55.400 --> 0:13:57.880
<v Speaker 1>that on to consumers. You know what, I think there

0:13:57.960 --> 0:13:59.720
<v Speaker 1>is some there is some evidence, right that we're getting

0:13:59.720 --> 0:14:02.600
<v Speaker 1>the broad out there. That's right, We're wanting to go here.

0:14:02.600 --> 0:14:04.920
<v Speaker 1>You're thinking, it's like, I am, Tiffany, what is the

0:14:05.000 --> 0:14:09.880
<v Speaker 1>evidence right now that we're actually seeing wage inflation besides

0:14:09.960 --> 0:14:13.880
<v Speaker 1>big press headlines from people like Amazon and warehouse workers

0:14:13.880 --> 0:14:16.880
<v Speaker 1>in that is it really out there? Well? Yeah, I

0:14:16.920 --> 0:14:20.200
<v Speaker 1>mean so, I think the Atlanta Fed measure is UM

0:14:20.480 --> 0:14:22.960
<v Speaker 1>is really helpful in that regard. And and and again it

0:14:23.080 --> 0:14:26.560
<v Speaker 1>shows that UM, you know, it's lower, lower wage, lower

0:14:26.560 --> 0:14:28.680
<v Speaker 1>skilled service jobs that are really seeing the brunt of

0:14:28.680 --> 0:14:31.400
<v Speaker 1>the wage inflation UM. But I think that a lot

0:14:31.440 --> 0:14:36.400
<v Speaker 1>of other jobs, UM, they get contract contract renegotiations happen

0:14:36.440 --> 0:14:38.200
<v Speaker 1>at the end of the year UM. And of course

0:14:38.240 --> 0:14:40.480
<v Speaker 1>the December report maybe doesn't pick this up, but in

0:14:40.560 --> 0:14:43.720
<v Speaker 1>January it's going to be very important to see are people,

0:14:44.040 --> 0:14:46.840
<v Speaker 1>you know, in broader sectors of the economy, are they

0:14:46.840 --> 0:14:49.760
<v Speaker 1>actually getting cost of living adjustments UM? And is that

0:14:49.800 --> 0:14:52.680
<v Speaker 1>broadening out? And and can people sort of bargain for that? So,

0:14:52.960 --> 0:14:55.080
<v Speaker 1>you know, again, I think there's some small indications that

0:14:55.160 --> 0:14:58.520
<v Speaker 1>that's starting to happen um now UM, and of course

0:14:58.560 --> 0:15:00.040
<v Speaker 1>this is this will be something that will be a

0:15:00.200 --> 0:15:01.960
<v Speaker 1>focused on them in the beginning of the year, getting

0:15:01.960 --> 0:15:06.040
<v Speaker 1>indications of that. All right, So, Tiffany, given the labor

0:15:06.280 --> 0:15:10.640
<v Speaker 1>data that we got today, what is the PIMPCO g

0:15:10.760 --> 0:15:13.360
<v Speaker 1>DP outlook and kind of what are the levers there

0:15:13.720 --> 0:15:16.360
<v Speaker 1>that could move it one way or the other? Yeah,

0:15:16.400 --> 0:15:18.760
<v Speaker 1>I mean so so overall, I mean, our forecasts, like

0:15:18.880 --> 0:15:22.120
<v Speaker 1>many other forecasters, are uh, you know, we're looking for

0:15:22.280 --> 0:15:24.520
<v Speaker 1>kind of a goldilocks environment of you will, of of

0:15:24.920 --> 0:15:29.120
<v Speaker 1>still strong GDP growth, but but something that's moderating, you know,

0:15:29.160 --> 0:15:31.640
<v Speaker 1>because the fiscal stimulus that we've gotten over the last

0:15:31.680 --> 0:15:35.080
<v Speaker 1>couple of years, of course is also moderating UM. But

0:15:35.160 --> 0:15:37.920
<v Speaker 1>in the midst of that, we're also, like many forecasters,

0:15:37.960 --> 0:15:42.080
<v Speaker 1>looking for inflation to to also moderate back, you know,

0:15:42.120 --> 0:15:46.200
<v Speaker 1>more towards levels consistent with with UM in central bank targets. Now.

0:15:46.360 --> 0:15:49.320
<v Speaker 1>You know, I again, I call that a goldilocks environment, UM,

0:15:49.360 --> 0:15:51.280
<v Speaker 1>And I think that's there's reasons to believe that's still

0:15:51.320 --> 0:15:53.840
<v Speaker 1>the base case, but there's a lot of risks underlying that,

0:15:53.920 --> 0:15:56.560
<v Speaker 1>and I think those risks have increased lately. You know.

0:15:56.600 --> 0:15:59.440
<v Speaker 1>One of them obviously is the you know, just inflation

0:15:59.520 --> 0:16:03.120
<v Speaker 1>remains per distantly elevated. UM. I think another risk, though

0:16:03.320 --> 0:16:06.320
<v Speaker 1>maybe underappreciated by markets, I'm not sure, is that you

0:16:06.320 --> 0:16:09.000
<v Speaker 1>could actually get a more abrupt tightening of financial conditions

0:16:09.320 --> 0:16:11.280
<v Speaker 1>related to that as well. Right, And because I think

0:16:11.280 --> 0:16:14.200
<v Speaker 1>the Fed you know, so far has been very um,

0:16:14.400 --> 0:16:17.400
<v Speaker 1>you know, they've been very successful in moving market expectations

0:16:17.400 --> 0:16:21.000
<v Speaker 1>for earlier timing of rate hikes, but miraculously broader financial

0:16:21.000 --> 0:16:24.480
<v Speaker 1>conditions to cross you know, equities, currencies, etcetera hadn't really tightened,

0:16:24.920 --> 0:16:26.560
<v Speaker 1>you know. So I think that raises the risk that

0:16:26.600 --> 0:16:29.520
<v Speaker 1>you get a more um, you know, a faster, more

0:16:29.600 --> 0:16:32.080
<v Speaker 1>uh you know, more volatile adjustment um you know. And

0:16:32.160 --> 0:16:33.880
<v Speaker 1>of course I think that's what something the FED does

0:16:33.920 --> 0:16:35.720
<v Speaker 1>want to avoid, you know. And then I think the

0:16:35.800 --> 0:16:38.800
<v Speaker 1>third risk obviously is just is just the virus itself. UM.

0:16:38.840 --> 0:16:41.520
<v Speaker 1>You know. It seems like the FED was pretty unconcerned

0:16:41.560 --> 0:16:44.680
<v Speaker 1>about the economic effects of O Macron, more concerned about

0:16:44.680 --> 0:16:47.320
<v Speaker 1>the inflationary effects. UM. But I think it just it

0:16:47.400 --> 0:16:50.320
<v Speaker 1>goes to highlight just the uncertainty in general of the

0:16:50.400 --> 0:16:52.520
<v Speaker 1>virus and and what it could bring in the in

0:16:52.560 --> 0:16:56.280
<v Speaker 1>the New Year, Tiffany, Thank you so much. Tiffany World

0:16:56.360 --> 0:17:04.800
<v Speaker 1>with with Pimcoast some really good inside Younger Andrew Peckash

0:17:04.920 --> 0:17:07.760
<v Speaker 1>is on Eastern Standard Time at the Johns Hopkins University

0:17:08.119 --> 0:17:11.919
<v Speaker 1>and gives us an i'm acron brief today into the weekend. Andrew,

0:17:12.000 --> 0:17:14.399
<v Speaker 1>even a dummy like me is figured out i'm acron

0:17:14.560 --> 0:17:18.280
<v Speaker 1>is not delta, but it's something, well, there's some mystery

0:17:18.359 --> 0:17:22.000
<v Speaker 1>to it. What's the biggest mystery with a'm acron into

0:17:22.040 --> 0:17:26.320
<v Speaker 1>this weekend? I think really it circles around the issue

0:17:26.320 --> 0:17:30.920
<v Speaker 1>of why this virus seems to be so much more transmissible. Certainly,

0:17:31.280 --> 0:17:33.920
<v Speaker 1>you know, it has mutations that can invade some of

0:17:33.960 --> 0:17:37.280
<v Speaker 1>the immune responses that vaccines give you, but it really

0:17:37.320 --> 0:17:40.160
<v Speaker 1>does seem like this virus is spreading better than other

0:17:40.280 --> 0:17:43.360
<v Speaker 1>variants for other reasons, and right now we don't really

0:17:43.440 --> 0:17:46.680
<v Speaker 1>understand what that is, but certainly it seems like people

0:17:46.680 --> 0:17:50.320
<v Speaker 1>are getting infected in on conditions that previously we're highly

0:17:50.400 --> 0:17:55.040
<v Speaker 1>unlikely uh to mediate infection, and that's fueling this massive

0:17:55.080 --> 0:17:59.040
<v Speaker 1>surge of cases. Transmission is something that's really difficult to

0:17:59.119 --> 0:18:02.520
<v Speaker 1>study a laboratory, but it really is one of the

0:18:02.560 --> 0:18:07.440
<v Speaker 1>things that a macron is doing fantastically better than any

0:18:07.480 --> 0:18:12.240
<v Speaker 1>previous variant we've seen. Is there a row or is

0:18:12.320 --> 0:18:15.320
<v Speaker 1>zeta after amacron? I mean I I frankly like the

0:18:15.359 --> 0:18:18.200
<v Speaker 1>geography designations that we used to do in the old days.

0:18:18.240 --> 0:18:21.320
<v Speaker 1>But do you just assume there's another variant after this one?

0:18:23.640 --> 0:18:27.359
<v Speaker 1>There absolutely will be um. This virus has already shown

0:18:27.920 --> 0:18:33.360
<v Speaker 1>the ability to evolve, change and respond to its new

0:18:33.400 --> 0:18:36.720
<v Speaker 1>host humans, and it's now showing the ability to try

0:18:36.760 --> 0:18:39.920
<v Speaker 1>to evade some of the immune responses that are coming

0:18:39.920 --> 0:18:42.960
<v Speaker 1>down the line. I do firmly feel we're on a

0:18:43.000 --> 0:18:46.560
<v Speaker 1>path to make this disease caused by this virus much

0:18:46.640 --> 0:18:53.119
<v Speaker 1>more mild, much work contained, because we will have population immunity,

0:18:53.160 --> 0:18:58.080
<v Speaker 1>we will have vaccines that are effectively knocking down severe disease,

0:18:58.280 --> 0:19:01.120
<v Speaker 1>and will eventually have antiviral that are distributed to help

0:19:01.280 --> 0:19:03.479
<v Speaker 1>limit that. So there are ways that we can control

0:19:03.560 --> 0:19:06.919
<v Speaker 1>this disease. But this virus will be around for a

0:19:06.960 --> 0:19:09.120
<v Speaker 1>long time, and it's looking more and more like we're

0:19:09.119 --> 0:19:11.000
<v Speaker 1>gonna have to deal with this like we deal with

0:19:11.280 --> 0:19:15.320
<v Speaker 1>seasonal influenza. Andy, When do we get to that point

0:19:15.400 --> 0:19:17.720
<v Speaker 1>where we have enough whether it's herd immunity or just

0:19:17.760 --> 0:19:21.320
<v Speaker 1>immunity in the general population with also the remedies, the

0:19:21.320 --> 0:19:24.320
<v Speaker 1>anti virals and the vaccines where we can basically go

0:19:24.400 --> 0:19:27.480
<v Speaker 1>back to life as it is, basically treat this like

0:19:27.560 --> 0:19:30.600
<v Speaker 1>the common cold or the flu. Well. I really do

0:19:30.680 --> 0:19:33.359
<v Speaker 1>feel like this surge of all macron cases is really

0:19:33.359 --> 0:19:36.240
<v Speaker 1>going to be the tipping point because with the massive

0:19:36.320 --> 0:19:38.679
<v Speaker 1>number of cases, and let's be clear, some of the

0:19:38.720 --> 0:19:42.879
<v Speaker 1>official counts are probably underestimates of the true number of

0:19:42.920 --> 0:19:44.840
<v Speaker 1>cases that are out there right now because of a

0:19:44.920 --> 0:19:48.000
<v Speaker 1>number of reasons. But this surge of all macron cases

0:19:48.520 --> 0:19:51.520
<v Speaker 1>maybe what really pushes us over that border to enough

0:19:51.560 --> 0:19:56.920
<v Speaker 1>immunity in the population so that transmission is limited and therefore,

0:19:57.200 --> 0:19:59.159
<v Speaker 1>you know, the likelihood of getting infected will be a

0:19:59.200 --> 0:20:03.200
<v Speaker 1>little bit lower going forward from here, How do people

0:20:03.240 --> 0:20:08.560
<v Speaker 1>avoid getting sick? Well, it really comes down to those

0:20:08.600 --> 0:20:11.720
<v Speaker 1>basic principles we've been talking about, perhaps boost it up

0:20:11.760 --> 0:20:14.600
<v Speaker 1>a little bit. I'm a big believer now that people

0:20:14.600 --> 0:20:18.200
<v Speaker 1>should be really thinking about wearing K and nine masks

0:20:18.840 --> 0:20:22.760
<v Speaker 1>um or double masking with a surgical mask and a

0:20:22.800 --> 0:20:26.160
<v Speaker 1>facial covering on top of that. I think that this

0:20:26.600 --> 0:20:31.000
<v Speaker 1>increased transmission of a macron requires people to take an

0:20:31.040 --> 0:20:35.400
<v Speaker 1>even greater UM effort to try to limit their exposures.

0:20:35.400 --> 0:20:38.520
<v Speaker 1>And again, masking is one thing. The other social distancing

0:20:38.560 --> 0:20:42.040
<v Speaker 1>issues that we've talked about UM are important to continue

0:20:42.119 --> 0:20:45.400
<v Speaker 1>to do, UH, do as much work as you can remotely,

0:20:46.000 --> 0:20:47.920
<v Speaker 1>but when you're going into situations where you're going to

0:20:47.960 --> 0:20:50.200
<v Speaker 1>be exposed to people, realize that you need to up

0:20:50.200 --> 0:20:51.919
<v Speaker 1>your game in terms of the things you do to

0:20:51.960 --> 0:20:56.200
<v Speaker 1>protect yourself and be wary of of getting infected. Andie

0:20:56.200 --> 0:20:58.720
<v Speaker 1>pekash there andie thank you sir as always that John's

0:20:58.720 --> 0:21:01.320
<v Speaker 1>Helpin splim By School of Public calf On. Yes three,

0:21:01.359 --> 0:21:04.359
<v Speaker 1>Tom entering, Yes three of all of this, and it

0:21:04.440 --> 0:21:08.480
<v Speaker 1>feels like a lifetime for so many people. This is

0:21:08.480 --> 0:21:12.480
<v Speaker 1>the Bloomberg Surveillance Podcast. Thanks for listening. Join us live

0:21:12.640 --> 0:21:16.399
<v Speaker 1>weekdays from seven to ten am Eastern on Bloomberg Radio

0:21:16.640 --> 0:21:20.280
<v Speaker 1>and on Bloomberg Television each day from six to nine

0:21:20.320 --> 0:21:24.720
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0:21:24.880 --> 0:21:29.879
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0:21:33.920 --> 0:21:38.080
<v Speaker 1>the terminal. I'm Tom Keene and this is Bloomberg