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Speaker 1: Bloomberg Audio Studios, podcasts, radio news. This is the Bloomberg

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Speaker 1: Surveillance Podcast. Catch us live weekdays at seven am Eastern

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Speaker 1: on Apple car Play or Android Auto with the Bloomberg

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Speaker 1: Business app. Listen on demand wherever you get your podcasts,

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Speaker 1: or watch us live on YouTube.

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Speaker 2: We have Kevin Gordon and Lizzie Saunders together.

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Speaker 3: I don't know they're in speaking to them. It's amazing

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Speaker 3: as it works out, we'll get to that in a moment.

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Speaker 3: Ready green in the screen. We welcome all of you

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Speaker 3: across your America, across Charles Schwabs America as well on YouTube.

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Speaker 3: Subscribe to Bloomberg Podcast. Did you have a YouTube brief?

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Speaker 3: We've sort of all thesting in the night. I know,

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Speaker 3: I know, it's pretty This internet thing's here to stay

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Speaker 3: on it is.

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Speaker 2: It's like this. It's not going away.

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Speaker 4: Exactly, so we'll take it. People are good.

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Speaker 2: Listen.

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Speaker 3: Do you have an ETF you're bringing out to everybody

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Speaker 3: else is flogging a new ETF? Okay, we're gonna get

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Speaker 3: to Josh Swab here and you know, Paul your observation

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Speaker 3: two days deep into the year.

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Speaker 5: Yeah, I think people trying to digest some kind of

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Speaker 5: what we learned over the weekend with some geopolitical risk,

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Speaker 5: putting that on the front burner. But it seems like

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Speaker 5: looking at the market action. You know, folks are looking

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Speaker 5: past it a little bit at least at this point.

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Speaker 5: And for somebody who's going down to a room in

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Speaker 5: a few days, I'm paying attention to what's going on

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Speaker 5: in Venezuela.

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Speaker 2: Seriously, it's like closer than Cuba.

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Speaker 5: To my cost airspace in the Caribbean Saturday. So people

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Speaker 5: got stranded all through the Caribbean, not just okay, you

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Speaker 5: see islands.

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Speaker 2: So this is special.

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Speaker 3: We've done this a few times during the year, and

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Speaker 3: with this quality, we can do it. Liz Ane Saunders

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Speaker 3: is definitive on Wall Street. Literally, her public service and

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Speaker 3: allowing Americans to develop their fur own case is noted

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Speaker 3: a few years.

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Speaker 2: Ago she had to go out. She's on a college tour.

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Speaker 3: You know, she's like, she's like talking to like, you know,

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Speaker 3: people that actually went to class.

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Speaker 2: You show up at Pepper and the thug.

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Speaker 3: Walks in the room. How did you hire Kevin Gordon?

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Speaker 3: Tell us about how you find someone that damn smart?

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Speaker 6: That question.

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Speaker 7: So SCHWAB has a huge conference every year called Impact.

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Speaker 6: A lot of Bloomberg folks.

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Speaker 7: Come out, Carol and Tim and they broadcast from there.

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Speaker 7: Kevin's mom was in the business for thirty eight years.

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Speaker 6: Thirty eight years.

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Speaker 7: He's not in but on a firm platformed with us,

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Speaker 7: and she brought Kevin to Impact when he was still

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Speaker 7: Pepperdine and I met with him and I was had

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Speaker 7: had conversations within Schwab about needing to build the bench

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Speaker 7: and I met with him and I said, this is

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Speaker 7: the guy the only rub is he still in college?

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Speaker 4: Can we wait?

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Speaker 6: And the answer was yes, we can wait.

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Speaker 3: What was your first day Schwab, Like, you know, you're

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Speaker 3: hired by it. You know she's thirty nine, but.

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Speaker 4: She's a legendary was what was it like to.

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Speaker 2: Be hired by liz Anne Sanders, who was iconic on

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Speaker 2: Wall Street Week a few years ago?

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Speaker 8: You know, I still pinched myself every day. It's a dream.

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Speaker 4: We have a ton of fun.

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Speaker 8: We work really hard, but it's from from day one,

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Speaker 8: I mean, it's been this really fun, you know, just

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Speaker 8: sort of grind and figuring out how to make sense

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Speaker 8: of all this and and at the end of the day,

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Speaker 8: it's you know, can be used to make sense of

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Speaker 8: the ecomom.

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Speaker 4: Lezanne sitting in your very seat.

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Speaker 5: Earlier today, we had a Joan come in and he

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Speaker 5: has a new ETF and it's basically hedging. You can

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Speaker 5: take all your mag seven stuff, all your stuff that's

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Speaker 5: just ripped, do an exchange, put it into this ETF

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Speaker 5: and they're.

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Speaker 4: Going to hedge it for you.

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Speaker 5: Capture, you know, top yeat on the top, cover your

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Speaker 5: bottom a little bit.

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Speaker 4: I looked at Thomas.

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Speaker 5: Is that representative how the market's thinking is our investors

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Speaker 5: that you talked to, Are they concerned that we've gone

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Speaker 5: too far, too fast and they'd like to hedge, or

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Speaker 5: maybe they're asking me this should I get out?

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Speaker 4: What are those conversations like?

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Speaker 7: I would say that is a bit of the vibe.

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Speaker 7: When I'm out on the road doing client events, I

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Speaker 7: do get a lot of questions about how do I

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Speaker 7: protect some of these gains or how do I mitigate

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Speaker 7: what might have been a concentration that developed in their

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Speaker 7: own portfolios in a way other than having to trim

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Speaker 7: positions have the tax implications associated with it. Yeah, so

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Speaker 7: there's a lot more generic lowercase H hedge in questions

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Speaker 7: that we're getting.

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Speaker 2: I mean, Kevin.

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Speaker 3: Lizzie Saunders is too young to remember eighty seven or

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Speaker 3: ninety eight.

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Speaker 2: Seven.

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Speaker 3: What does a young stud like you do about worrying

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Speaker 3: about the thirty percent down event we can't see coming.

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Speaker 8: Well, I think what's really interesting, I've spent a lot

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Speaker 8: of time thinking about this in the post pandemic world,

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Speaker 8: where you know, the gen z and the young, young

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Speaker 8: millennial cohortive investors for the most part, actually has not

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Speaker 8: really experienced what I think of as a real bear market.

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Speaker 8: I mean, everything has been sort of conditioned on. As

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Speaker 8: soon as you fall into bear market territory, there will

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Speaker 8: be some sort of stimulus or eight that comes in

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Speaker 8: right away, and then you get this launch.

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Speaker 2: Off of the bottom.

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Speaker 8: You had that in twenty twenty, you had that in

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Speaker 8: twenty twenty five, even in twenty twenty two. Yes, the

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Speaker 8: bear market was a little bit longer, but it wasn't

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Speaker 8: that spirit. It was twenty five percent from peak to trough.

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Speaker 8: So there has been this conditioning where you know it's

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Speaker 8: by the dip and just keep holding on, and that's

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Speaker 8: been that's been sort of the right call. But I

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Speaker 8: think that you know, moving forward, especially if there is

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Speaker 8: going to be a little bit of a broader rotation

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Speaker 8: outside of the megacaps that is going to weigh a

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Speaker 8: little bit more on index level.

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Speaker 3: I'm going to give the younger crew major cred they're

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Speaker 3: way more serious about starting retirement earlier.

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Speaker 2: Yeah, we're just seventy four.

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Speaker 7: Weren't even four one k is when I started working.

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Speaker 8: But I was also getting pushed though into the market,

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Speaker 8: whether they and I think there is a desire to

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Speaker 8: do so, which is good, but especially when you go

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Speaker 8: down the age spectrum, there is a sense that the

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Speaker 8: so called American dream of housing is becoming sort of

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Speaker 8: a lost opportunity. So it is pushing more people into

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Speaker 8: the stock market for better or worse.

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Speaker 7: But that traditional retirement, even social security may not be

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Speaker 7: available now. I think one of the rubs right now

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Speaker 7: is the gambling mentality. Yes, and that's something that we're

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Speaker 7: at CHUAB very focused on. Is the differentiation between investing

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Speaker 7: and gambling. One of the ways I think of it

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Speaker 7: as investing as owning gambling is hoping and there is

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Speaker 7: that blending of the trading and the gambling side.

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Speaker 6: That is something that we worry a little bit about.

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Speaker 5: So, Lizen, how do you set up the conversation here

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Speaker 5: for just equity investors after we've had three years of

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Speaker 5: double digit returns very rare.

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Speaker 4: Do we have a fourth one here? But how do

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Speaker 4: you set up that conversation for twenty twenty six.

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Speaker 7: I think this could be a year where maybe index

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Speaker 7: level gains are a bit more muted, but opportunity continuing

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Speaker 7: to present itself outside of just the megacap names. So

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Speaker 7: you know, one of the things that happened last year

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Speaker 7: the market, you know, air quotes around the market is

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Speaker 7: more than just a cohor like the Magnificent seven big

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Speaker 7: drivers until the latter part of the year in performance,

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Speaker 7: but a lot of churn in rotation under the surface,

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Speaker 7: sub level bear markets in terms of maximum drawn down

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Speaker 7: on a rotational basis, And I think that was one

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Speaker 7: of the setups for this more recent environment of broader

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Speaker 7: participation action down the cap spectrum. And I think that

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Speaker 7: has legs, maybe not in a linear fashion, but has

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Speaker 7: legs this year.

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Speaker 3: Across the nation from Pepper into the University of Delaware.

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Speaker 3: Charles Schwab is with us today, Lizzane Saunders in Kevin Gordon,

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Speaker 3: Decades of excellence from Lizanne Sounders Kevin Gordon. You know,

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Speaker 3: there's a lot of work from home going on. I

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Speaker 3: did that, and so we welcome all of you on YouTube.

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Speaker 3: Subscribe to Bloomberg Podcast. We're thunderstruck by our digital exercise.

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Speaker 2: What are you doing to do the message digitally?

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Speaker 8: I mean, we've got a really strong presence on YouTube,

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Speaker 8: and I think it's sort of an underappreciated, maybe underplayed,

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Speaker 8: unknown undernown aspect of of Schwab's digital for print. But

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Speaker 8: you know, also it was in social media, you know,

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Speaker 8: Lizanna and I not to I guess, you know, I

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Speaker 8: don't know toot our own horns too much, but we

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Speaker 8: try to be as active as possible across formerly Twitter,

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Speaker 8: x LinkedIn.

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Speaker 2: Do you, Kevin? Do you make all the charts? Not

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Speaker 2: all of them?

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Speaker 7: Not all of them, But you don't want me making

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Speaker 7: my own shots. Honestly, it's crayons and construction figures.

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Speaker 8: But it's been a good way to interact with people.

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Speaker 8: And I think that, you know, the more so these days.

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Speaker 8: Everybody wants those kind of shorter form quick takes, but

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Speaker 8: things that are meaningful to you don't want, you know,

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Speaker 8: meetingless stuff.

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Speaker 5: Hey, Kevin, we were all patting ourselves on the back

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Speaker 5: because the US had a pretty good twenty twenty five

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Speaker 5: in terms of equity return. Now where you go outside

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Speaker 5: the US even better, what are those conversations you have

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Speaker 5: with your clients, because quite frankly, I've never really thought

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Speaker 5: about investing outside of the US and my career.

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Speaker 4: I'm sure some of my mutual fund somewhere have got

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Speaker 4: me there. But are you having more and more of

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Speaker 4: those conversation?

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Speaker 8: You know, I'm just now reads starting to get and

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Speaker 8: I think probably the same for Lazan, and we rarely

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Speaker 8: speak at the same events. We're really kind of a

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Speaker 8: divide and conquered crew when we travel, so you know,

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Speaker 8: I'm just starting now to get questions about, hey, should

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Speaker 8: I consider this? What is the opportunity to look like?

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Speaker 4: And that tends to happen.

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Speaker 8: You get the big swings in performance first in favor

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Speaker 8: of a certain asset class, whether it is international, and

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Speaker 8: then the you know, the performance chasing tends to kick

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Speaker 8: in and then the flows start to move in that direction.

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Speaker 9: So we found that it tends to work in.

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Speaker 8: Maybe three year, you know, with a three year lag

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Speaker 8: where it starts to kick in three years after international

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Speaker 8: starts to outperform. It's not always the you know, textbook case,

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Speaker 8: but I have been starting to get more questions about that,

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Speaker 8: especially because you know Lazan mentioned earlier.

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Speaker 9: There is a little bit more of.

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Speaker 8: A concern now about concentration in portfolios, specifically with tech

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Speaker 8: and tech like parts of the market, just by virtue

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Speaker 8: of their size over the past ten years. If you

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Speaker 8: sort of set it and forget a portfolio, you know

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Speaker 8: ten years ago and didn't do much tech, and those

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Speaker 8: parts of your portfolio have grown to an immense portion.

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Speaker 8: So there has been more of a concern about how

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Speaker 8: do I trim that and add into to what might

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Speaker 8: work better.

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Speaker 7: We've been joking that recommending international diversification has been about

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Speaker 7: constantly saying I'm sorry, and now it's your welcome.

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Speaker 10: Exactly.

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Speaker 4: Europe Asia just extraordinary in particularly.

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Speaker 3: Does it have legs or is it just a dollar

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Speaker 3: dynamic where they requirement of a week now.

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Speaker 4: Well maybe yes to both of those.

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Speaker 7: I think there's the currency dynamic and that will probably

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Speaker 7: be a function or it will dry volatility in swings,

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Speaker 7: so I don't I think the international app performance is

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Speaker 7: probably not linear in nature, but for the most part,

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Speaker 7: I think.

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Speaker 6: It has legs. If you look at the.

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Speaker 7: Traditional fundamentals of the trajectory of earnings that represents a support.

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Speaker 7: A lot of at least developed economies don't have the

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Speaker 7: same inflation problem with which the US is still dealing,

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Speaker 7: so it means a different monetary policy backdrop.

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Speaker 3: WELLZ, I have family members who have been hoping and

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Speaker 3: enjoying losing money, most of it are on bitdog.

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Speaker 2: And all these are the young tucks. You know, they

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Speaker 2: don't talk.

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Speaker 6: They're not in the triple leverage all cash.

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Speaker 3: No, their parents are, but you know they go through

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Speaker 3: that bill to talk to me when they've lost that

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Speaker 3: much money. How does someone who lost it hoping rebuild?

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Speaker 3: How do they become an adult?

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Speaker 11: Boy?

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Speaker 6: That's a good question. You know.

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Speaker 7: Sometimes the answers to questions like that are really boring.

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Speaker 2: Which is boring.

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Speaker 7: Investing should never be about a moment in time, get in,

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Speaker 7: get out.

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Speaker 6: Neither of those are investing strategies.

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Speaker 7: So where a strategy needs to be employed for somebody

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Speaker 7: that maybe made that mistake and got out is don't

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Speaker 7: try to time the get back in. Do it slowly,

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Speaker 7: develop a process over time dollar cost averaging. Again, the

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Speaker 7: stuff that is fairly boring to talk about. I also

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Speaker 7: use the analogy of a jigsaw puzzle, which I love

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Speaker 7: doing jigsaw puzzles, and you know, sort of pose the

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Speaker 7: question what's the most important piece and usually people will

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Speaker 7: say the last one, or the corner or any of

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Speaker 7: the side pieces, and we often say it's the picture

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Speaker 7: on the box. Try doing a complicated jigsaw puzzle without

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Speaker 7: the picture on the box.

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Speaker 6: That's the plan.

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Speaker 7: So the first thing is actually have a plan. Too

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Speaker 7: many investors and not just young investors, but they're just

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Speaker 7: sort of winging it, and have that actual plan and

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Speaker 7: use that as the base for Okay, how do I

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Speaker 7: get re engaged?

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Speaker 5: And at a lot of I'm just going to use

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Speaker 5: my household. For young adults, it's all online, a lot

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Speaker 5: of digital and I'm like, who are you talking to?

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Speaker 5: Who's giving you advice about allocation and things like Well, Matt,

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Speaker 5: I think that matters a lot more in the context

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Speaker 5: of I mean, the macro environment today is I mean,

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Speaker 5: it's quite precarious.

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Speaker 8: It's unique relative to history. I mean, you look at

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Speaker 8: just this year in many ways, I think of it

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Speaker 8: as being the year of the courts, not just from

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Speaker 8: a tariff standpoint, but also from Alisa Cook, you know,

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Speaker 8: a fed independence and the integrity of the fed in

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Speaker 8: the structural you know, soundness of it moving forward in

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Speaker 8: terms of making policy. All of that has carries a

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Speaker 8: lot of macro risks with it. But to hedge against

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Speaker 8: that are to guard against that, you do need some

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Speaker 8: extent somebody to talk to or at the very least,

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Speaker 8: to Zant's point, having a plan to help safeguard against.

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Speaker 8: Especially with what's happened over the weekend. I mean so

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Speaker 8: many questions, you know, I was sort of fielding a

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Speaker 8: ton from friends and family over the weekend about what

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Speaker 8: does this mean for portfolios? But you know, often you

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Speaker 8: get those kind of more panicky questions when it's somebody

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Speaker 8: who hasn't done something, you know, the sort of prep

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Speaker 8: work not to criticize. But that's why it matters a lot.

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Speaker 2: O wise one, did you know where Keana was in

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Speaker 2: the map?

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Speaker 8: Well, yes, but only because I did so, only because

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Speaker 8: I like I like geography, and I'm a little obsessed,

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Speaker 8: so well I.

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Speaker 3: Like it too when I thought it was western Colombia,

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Speaker 3: which shows you what I know.

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Speaker 2: Lizzie and Sunder is Kevin Gordon with this, This is a.

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Speaker 3: Special moment there with Charles Schwab where the equity franchise

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Speaker 3: has been noted. This is out on the Left coast

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Speaker 3: decades and decades ago, long before Lizzie got there, And

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Speaker 3: it was Charles Schwab up in San Francisco building.

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Speaker 2: Remember how original it was.

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Speaker 10: Yep.

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Speaker 2: It was like, you're kidding these and they're in San Francisco,

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Speaker 2: they're not for real.

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Speaker 3: And down in La was Capitol Group with Robert Kirby

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Speaker 3: and John Lovelace and all that, and they'd put out

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Speaker 3: these studies which said, if you miss the ten biggest days. Ready, folks,

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Speaker 3: the jargon Gordon jargon has five hundred beeps. You give

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Speaker 3: up five percentage points of performance by missing the ten

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Speaker 3: biggest days in the year.

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Speaker 8: Kevin Gordon discuss, Yes, And actually a lot of those

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Speaker 8: biggest days come in pretty significant volatility moments when you're

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Speaker 8: in bear markets, and it happens, you know, when you

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Speaker 8: kind of feel that panic settle in and it's, oh

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Speaker 8: my gosh, we're down x percent from the top. Should

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Speaker 8: I just get out and sell everything? And that's when

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Speaker 8: you tend to give up a lot of that future

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Speaker 8: return because you get these what Zanletes to call rip

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Speaker 8: your face off rallies. Sometimes in the middle of these

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Speaker 8: bear market moments, and it happened in April last year.

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Speaker 7: And not only that, but some of the the biggest

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Speaker 7: single updates immediately followed some of the single biggest down days.

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Speaker 2: The rebound right, And what's important your folks, I got

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Speaker 2: to know. I'm talking to Kevin Court Luzanne. I speak English.

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Speaker 3: It's a four box solution. You mentioned one of the boxes,

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Speaker 3: which is you're out of the market, You've got to

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Speaker 3: get back in. The hard part is getting back in.

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Speaker 2: It's nons a some wildly log normal.

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Speaker 7: But I'll say again, neither get in nor get out,

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Speaker 7: if it's all or nothing is an investing strategy. That's

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Speaker 7: just gambling on moments in time, and I think that's

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Speaker 7: one of the mistakes that investors make.

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Speaker 4: Louzanne, I'm going on forty years in this business. Coming

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Speaker 4: up in June.

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Speaker 5: One of the biggest developments for me has been ETFs.

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Speaker 5: I mean, the money flowing into those is just extraordinary.

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Speaker 5: How does that factor into your discussion with plans?

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Speaker 3: Oh?

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Speaker 7: Yeah, And I think you know, we do a lot

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Speaker 7: of work on investor sentiment and that in the buckets

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Speaker 7: of attitudinal measures of sentiments. Some of the traditional indicators

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Speaker 7: like aaii market Association and investors intelligence ones I've been

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Speaker 7: following since I started forty years ago in this business.

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Speaker 7: But there's the behavioral side of investor sentiment, and one

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Speaker 7: key metric associated with that fun flows. When I started

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Speaker 7: in the business, it was all about mutual fund flows.

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Speaker 6: Traditional mutual fund flows.

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Speaker 7: Now completely served in terms of what's going on with ETFs,

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Speaker 7: and it is a really valuable way to kind of

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Speaker 7: proxy the behavioral measure of investor sentiment.

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Speaker 2: Two thousand and four, you were like twenty seven years

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Speaker 2: old or something like that.

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Speaker 10: I have a.

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Speaker 3: Photo which is proved forty years old, Elizabeth Saunders at

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Speaker 3: the table with the bush, the younger in the fiscal policy.

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Speaker 3: Our fiscal policy now is way more moldy than it

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Speaker 3: was in.

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Speaker 2: Two thousand and four? What should investors do? Should they

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Speaker 2: worry about that?

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Speaker 7: So we get this question all the time. The number

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Speaker 7: one theme of questions that I get at client events

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Speaker 7: is around deficits, and.

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Speaker 6: And often it's followed.

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Speaker 7: By sort of an addendum to the question, what's the

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Speaker 7: tipping point? Is there going to be some sort of crescendo?

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Speaker 7: Is the dollar going to lose its reserve currency sets?

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Speaker 7: Are we going to default on our debt is China

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Speaker 7: literally or figurally going to wake up one day and

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Speaker 7: decide to dump all all treasuries, and we don't have

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Speaker 7: those sort of draconian worries. There's no replacement for the dollars,

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Speaker 7: the world's reserve currency. We are not going to default

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Speaker 7: on our debt. China dumping treasuries on mass, they'd be

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Speaker 7: aiming the guns squarely at their own economic foot. Now

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Speaker 7: they've been diversifying away from such a heavy weight in

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Speaker 7: dollar denominated securities, but that's been.

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Speaker 6: A ten year process. That's not a recent thing.

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Speaker 7: The biggest implication of a hind rising burden of debt,

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Speaker 7: in addition to the interest costs associated with that, is

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Speaker 7: it acts as a bit of a wet blanket on growth.

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Speaker 7: It constrains growth. And that's not a new phenomenon. That's

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Speaker 7: not a respective phenomenon. That's a phenomenon we've been living

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Speaker 7: with for quite some time, as are other countries that

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Speaker 7: experience that same groom.

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Speaker 2: This has been wonderful.

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Speaker 3: Elizabeth Saunders, Kevin Gordon, thank you always and forever with

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Speaker 3: shab stay with us. More from Bloomberg Surveillance coming up

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Speaker 3: after this.

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Speaker 1: You're listening to the Bloomberg Surveillance Podcast. Catch us live

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Speaker 1: weekday afternoons from seven to ten am Eastern. Listen on

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Speaker 1: Applecarplay and Android Otto with the Bloomberg Business app, or

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Speaker 1: watch us live on YouTube.

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Speaker 3: Riccardo Housman is definitive on his Venezuela. Ricardo, I want

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Speaker 3: to go back before your acclaim at Harvard, before your

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Speaker 3: public service decades ago, to your Venazuela. How did the

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Speaker 3: Houseman family get from a World War two Europe over

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Speaker 3: to Venezuela. How did your family emigrate to Venezuela a

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Speaker 3: lifetime ago?

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Speaker 11: Well, a Jewish family, my father, they both went through

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Speaker 11: the Holocaust. My father lost both his parents. He arrived

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Speaker 11: at Venezuela at age seventeen with some He managed to

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Speaker 11: get himself to Spain, and then everybody in Spain thought

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Speaker 11: that Hitler was going to take over Spain, so he

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Speaker 11: ended up with another relative in Venezuela. And my mother

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Speaker 11: lived through the German occupation in Belgium and she was

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Speaker 11: freed by the USGIS in September nineteen forty four. She

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Speaker 11: was living with a Catholic family in a village in

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Speaker 11: the south of Belgium until they were liberated. She lived

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Speaker 11: for over a year thereafter after, as you know, they

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Speaker 11: got the papers to go to the train station in

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Speaker 11: nineteen forty two. So that's how they ended up in Venezuela. Venezuela,

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Speaker 11: they had a you know, they created a really really

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Speaker 11: nice life for themselves. And so when I grew up,

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Speaker 11: Venezuela was this heaven and well I had this image

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Speaker 11: of Europe. That's this horrible place where my parents had

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Speaker 11: come from.

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Speaker 3: Right, I look Professor Hausman and against This is part

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Speaker 3: of the story, folks, from Venezuela to the tip of Rgin. Tina,

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Speaker 3: your economist essay written yesterday for zenniment in Betters is

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Speaker 3: absolutely scathing. You say the president of the United States

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Speaker 3: is quote delusional. What does President Trump get wrong?

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Speaker 11: Well, he thinks that extracting oil from the ground is

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Speaker 11: a technical issue. But extracting oil from the ground, if

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Speaker 11: it was a technical issue, Venezuela.

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Speaker 10: Would be a powerhouse.

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Speaker 11: But the reason why oil production in Venezuela collapsed, that's

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Speaker 11: so many other things collapsed, is because oil is a

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Speaker 11: long term investment proposition. You have to part with a

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Speaker 11: lot of money and wait until you know you get

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Speaker 11: a cash flow to recover that money over a very

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Speaker 11: long period of time. And in that long period of time,

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Speaker 11: you have to be assured that you have some property

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Speaker 11: rights that are going to be respected. And if he

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Speaker 11: thinks that right now, he's going to recover oil production,

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Speaker 11: because he's going to tell us major companies to go

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Speaker 11: out and part with billions of dollars in Venezuela in

445
00:21:31,600 --> 00:21:35,719
Speaker 11: the context of an illegitimate government because Malula stole an election.

446
00:21:36,200 --> 00:21:39,960
Speaker 11: But this woman who's now president of Venezuela, she didn't

447
00:21:40,000 --> 00:21:41,879
Speaker 11: even win pretend to win an election.

448
00:21:41,960 --> 00:21:44,359
Speaker 10: She was appointed by a guy who stole an election.

449
00:21:44,960 --> 00:21:48,840
Speaker 11: And he's going to get concessions that have no approval

450
00:21:48,880 --> 00:21:53,919
Speaker 11: in law by any national Assembly that was elected by anybody.

451
00:21:54,000 --> 00:21:56,399
Speaker 11: And you would expect at the moment they will go

452
00:21:56,520 --> 00:21:59,920
Speaker 11: back to democracy, that any of those conditions are going

453
00:21:59,920 --> 00:22:03,679
Speaker 11: to be respected by a new by a new political majority.

454
00:22:03,800 --> 00:22:08,600
Speaker 11: So I think that there is the Democracy is not

455
00:22:08,800 --> 00:22:14,080
Speaker 11: a goal to be put after economic recovery. Democracy is

456
00:22:14,119 --> 00:22:17,439
Speaker 11: an instrument of economic recovery. It's the way of telling

457
00:22:17,520 --> 00:22:22,959
Speaker 11: Venezuelans your rights will be protected. Go back and and

458
00:22:22,960 --> 00:22:24,800
Speaker 11: and you know, dream, go back to.

459
00:22:25,200 --> 00:22:28,080
Speaker 3: Camp where you knew as a kid, Ricarda. Housman with

460
00:22:28,200 --> 00:22:30,600
Speaker 3: us of Harvard University. Folks were thrilled that he could

461
00:22:30,600 --> 00:22:33,280
Speaker 3: be with the Shannon O'Neil coming up. We welcome all

462
00:22:33,359 --> 00:22:36,720
Speaker 3: of you around the world. Please subscribe to YouTube. Paul

463
00:22:36,720 --> 00:22:39,680
Speaker 3: and I humbled by the digital success this year. Paul

464
00:22:39,720 --> 00:22:42,760
Speaker 3: Sweeney with Riccardo Housman, Professor.

465
00:22:42,800 --> 00:22:45,119
Speaker 5: Do we know or what can you tell us about

466
00:22:45,160 --> 00:22:49,960
Speaker 5: what the average Venezuelan really on the ground once from

467
00:22:50,119 --> 00:22:52,520
Speaker 5: this government going forward or from any government?

468
00:22:54,119 --> 00:22:58,800
Speaker 11: Well, I mean Venezuelans voted massively in favor of a

469
00:22:58,920 --> 00:23:02,960
Speaker 11: change of direction. Right they when they were allowed to

470
00:23:03,040 --> 00:23:06,320
Speaker 11: have a primary that the government tried to prevent. Well,

471
00:23:06,359 --> 00:23:09,920
Speaker 11: Mariacarina Machallo won with ninety plus percent of the vote

472
00:23:10,560 --> 00:23:14,080
Speaker 11: when she was not allowed to run and she anointed

473
00:23:14,119 --> 00:23:15,360
Speaker 11: somebody to run instead.

474
00:23:15,880 --> 00:23:16,480
Speaker 10: They voted.

475
00:23:17,880 --> 00:23:21,840
Speaker 11: You know, this guy won with a margin of forty points,

476
00:23:22,080 --> 00:23:24,480
Speaker 11: and he didn't want buy more because they didn't not

477
00:23:24,800 --> 00:23:28,160
Speaker 11: let us Venezuelants abroad vote and they did not let

478
00:23:28,200 --> 00:23:30,760
Speaker 11: three million young Venezuelans to register.

479
00:23:31,400 --> 00:23:33,720
Speaker 10: Had that happened, we would have won with an even

480
00:23:33,800 --> 00:23:34,520
Speaker 10: larger margin.

481
00:23:34,600 --> 00:23:39,400
Speaker 11: So Venezuelans are unified politically in a new direction. If

482
00:23:39,400 --> 00:23:42,200
Speaker 11: you allowed venezuelants to choose, they would choose a very

483
00:23:42,240 --> 00:23:43,920
Speaker 11: competitive legal.

484
00:23:43,640 --> 00:23:46,760
Speaker 10: Framework for oil and they would engineer on oil boom.

485
00:23:47,960 --> 00:23:49,080
Speaker 10: We don't need.

486
00:23:49,119 --> 00:23:54,119
Speaker 11: A you know, American help to engineer an oil boom

487
00:23:54,119 --> 00:23:58,600
Speaker 11: because the world is full of oil companies that would

488
00:23:58,680 --> 00:24:02,400
Speaker 11: want to quit back into Venezuela under the right conditions,

489
00:24:02,600 --> 00:24:06,080
Speaker 11: and we have a political majority to create the right conditions.

490
00:24:06,640 --> 00:24:11,440
Speaker 11: But this system that they have described right now, it's

491
00:24:11,480 --> 00:24:15,600
Speaker 11: not workable. It's something that works on one on a

492
00:24:15,640 --> 00:24:18,320
Speaker 11: day to day basis that they're saying, well, we leave

493
00:24:18,359 --> 00:24:21,760
Speaker 11: the same bad guys that were empowered before, the guys

494
00:24:21,760 --> 00:24:24,639
Speaker 11: who are indicted. I mean the guys who are in

495
00:24:24,680 --> 00:24:29,320
Speaker 11: the same indictment as Nicolas malulu Are. One is the

496
00:24:29,480 --> 00:24:31,639
Speaker 11: Minister of Defense and the other one is the Minister

497
00:24:32,480 --> 00:24:33,560
Speaker 11: of the Internal Police.

498
00:24:34,000 --> 00:24:35,720
Speaker 10: So it's the same guys.

499
00:24:35,800 --> 00:24:38,719
Speaker 11: We're there and they pretend to say, well, we are

500
00:24:38,800 --> 00:24:40,760
Speaker 11: going to tell them what to do and they're going

501
00:24:40,800 --> 00:24:42,000
Speaker 11: to do our bidding.

502
00:24:42,400 --> 00:24:46,000
Speaker 10: But when they say our bidding, they think that they.

503
00:24:45,840 --> 00:24:50,240
Speaker 11: Can get a recovery of Venezuela without empowering Venezuelan citizens

504
00:24:50,280 --> 00:24:51,000
Speaker 11: with rights.

505
00:24:51,200 --> 00:24:52,120
Speaker 10: That's not going to work.

506
00:24:52,240 --> 00:24:54,600
Speaker 5: Professor Isert, do you think of there's a scenario where

507
00:24:54,640 --> 00:24:57,879
Speaker 5: the Trump administration can in fact exert control over this

508
00:24:57,920 --> 00:24:58,560
Speaker 5: government like.

509
00:24:58,800 --> 00:24:59,960
Speaker 4: I think they think they can.

510
00:25:01,480 --> 00:25:04,359
Speaker 11: Well, I mean what they think they again is to

511
00:25:04,400 --> 00:25:06,280
Speaker 11: say either you do what I tell you or I

512
00:25:06,359 --> 00:25:09,080
Speaker 11: kill you because I have drones. I don't want to

513
00:25:09,080 --> 00:25:11,600
Speaker 11: put boots on the ground. I have drones, I have missiles.

514
00:25:11,600 --> 00:25:14,440
Speaker 11: I can kill you, So you better do what we want.

515
00:25:14,480 --> 00:25:18,159
Speaker 11: But we dinner rupt Ricardo. But Paul nailed it with

516
00:25:18,240 --> 00:25:18,840
Speaker 11: that question.

517
00:25:19,280 --> 00:25:23,520
Speaker 3: What this is about is in is direct community violence,

518
00:25:23,880 --> 00:25:29,000
Speaker 3: whether it's Cuba or Venezuela. I mean President Trump in

519
00:25:29,080 --> 00:25:33,640
Speaker 3: his advocates have to decide if they want to participate

520
00:25:33,720 --> 00:25:38,200
Speaker 3: with people who are violent. How do you in your

521
00:25:38,320 --> 00:25:42,960
Speaker 3: Venezuela how do we move forward to a constructive end?

522
00:25:43,760 --> 00:25:49,800
Speaker 3: What's the Houseman process? In January, February, in March of

523
00:25:49,840 --> 00:25:50,359
Speaker 3: this year.

524
00:25:51,960 --> 00:25:57,399
Speaker 11: Well, you want to empower the people who have strategic

525
00:25:57,520 --> 00:25:59,840
Speaker 11: interests that are aligned with you, and that is all

526
00:25:59,880 --> 00:26:01,119
Speaker 11: the Venezuela Democrats.

527
00:26:01,600 --> 00:26:03,200
Speaker 10: So this idea that you.

528
00:26:03,160 --> 00:26:07,960
Speaker 11: Can do your thing without having to deal with the

529
00:26:08,240 --> 00:26:14,159
Speaker 11: organized Venezuelan opposition that, under enormously difficult situations, was able

530
00:26:14,200 --> 00:26:17,280
Speaker 11: to win an election. When you want you want to

531
00:26:17,400 --> 00:26:21,520
Speaker 11: You want to empower them to help you do you

532
00:26:21,560 --> 00:26:23,120
Speaker 11: want a strategic alliance with them?

533
00:26:23,400 --> 00:26:26,240
Speaker 10: But you don't want to hear this dismissive.

534
00:26:27,480 --> 00:26:32,080
Speaker 11: Description of Maria Acorina Machau as as somebody who's not

535
00:26:32,200 --> 00:26:35,960
Speaker 11: respected in Venezuela. I challenge you to mention somebody in

536
00:26:36,040 --> 00:26:40,280
Speaker 11: the world who's more respected than Maria Acorna Matchau. Obviously

537
00:26:40,359 --> 00:26:43,280
Speaker 11: she's super respected in Venezuela. That's why she can win

538
00:26:43,320 --> 00:26:46,840
Speaker 11: elections in Venezuela. Now that's different from saying she has

539
00:26:46,880 --> 00:26:48,000
Speaker 11: the command over troops.

540
00:26:48,080 --> 00:26:51,119
Speaker 3: We're gonna share O'Neil with this, Professor Hausman. But let

541
00:26:51,160 --> 00:26:53,160
Speaker 3: me ask you this Viscal. This came up Paul, last

542
00:26:53,200 --> 00:26:56,640
Speaker 3: side of the dining room table. Where does the military

543
00:26:57,320 --> 00:26:59,440
Speaker 3: Venezuela fit in? I mean, if I look at the

544
00:26:59,480 --> 00:27:03,240
Speaker 3: Philip means and the shift from diu Terte to the

545
00:27:03,280 --> 00:27:08,280
Speaker 3: younger Marcos, the military play a part there. Instability is

546
00:27:08,320 --> 00:27:12,760
Speaker 3: the military of your Venezuela stable or unstable.

547
00:27:14,200 --> 00:27:20,160
Speaker 11: The military of Venezuela is led by an arco terrorist

548
00:27:20,320 --> 00:27:21,960
Speaker 11: organization and they're still in power.

549
00:27:23,440 --> 00:27:26,200
Speaker 10: But below that there's a lot of people who would

550
00:27:26,200 --> 00:27:27,200
Speaker 10: be willing, who.

551
00:27:27,080 --> 00:27:30,600
Speaker 11: Would want to go back to a more democratic regime

552
00:27:30,680 --> 00:27:34,600
Speaker 11: under a civilian rule. But they cannot they're not allowed

553
00:27:34,640 --> 00:27:40,480
Speaker 11: to organize. They're being spied by the military, secret police,

554
00:27:41,400 --> 00:27:44,959
Speaker 11: and they're being put in prison, they're being tortured. So

555
00:27:45,960 --> 00:27:49,960
Speaker 11: what we need if Trump is going to demand something

556
00:27:50,040 --> 00:27:53,320
Speaker 11: from from Delci Rodriguez, is that she.

557
00:27:52,880 --> 00:27:55,320
Speaker 10: Delivered josdal Cavego, the head.

558
00:27:55,119 --> 00:28:01,119
Speaker 11: Of the police, Bladimir Padrino, the Minister of Defense. Those

559
00:28:01,200 --> 00:28:03,760
Speaker 11: are the heads of the Cartel of the Suns, the

560
00:28:03,840 --> 00:28:07,480
Speaker 11: Cartel Deloslis. They are the narco traffickers. They are now

561
00:28:07,520 --> 00:28:12,000
Speaker 11: in charge of the country, and they are the ones

562
00:28:12,400 --> 00:28:16,840
Speaker 11: who yesterday put in prison twelve journalists, so that the

563
00:28:16,920 --> 00:28:18,960
Speaker 11: number of political prisoners in Venezuela is.

564
00:28:18,920 --> 00:28:21,800
Speaker 10: Going up, knock down. Okay, So.

565
00:28:23,160 --> 00:28:25,640
Speaker 11: You want you want to fix the country, you need

566
00:28:25,680 --> 00:28:31,400
Speaker 11: to get rid of this leadership, this corrupt, criminal leadership

567
00:28:31,440 --> 00:28:35,600
Speaker 11: that is in control of the army, and to empower

568
00:28:36,880 --> 00:28:41,560
Speaker 11: the bulk of the army to go back to civilian rule.

569
00:28:41,720 --> 00:28:43,480
Speaker 2: Paul, get one more questions in your professor.

570
00:28:43,560 --> 00:28:47,239
Speaker 5: Professors, are scenario where the people of Venezuela rise up

571
00:28:47,280 --> 00:28:48,120
Speaker 5: and force change.

572
00:28:49,680 --> 00:28:53,520
Speaker 11: I think that you know everybody now is willing to

573
00:28:53,560 --> 00:28:56,800
Speaker 11: give a line of credit because you know, we've tried

574
00:28:56,880 --> 00:28:59,200
Speaker 11: so hard to get rid of Maluro and we weren't

575
00:28:59,240 --> 00:29:02,080
Speaker 11: able to do it on our own. So everybody is

576
00:29:02,160 --> 00:29:06,320
Speaker 11: very happy that that the US was able to get

577
00:29:06,360 --> 00:29:11,360
Speaker 11: rid of Maluro. But and and they're hoping that this

578
00:29:11,600 --> 00:29:15,239
Speaker 11: is the beginning of a good process. But you know,

579
00:29:15,360 --> 00:29:21,400
Speaker 11: the statements of Trump after you at Madlago and afterwards

580
00:29:21,680 --> 00:29:27,320
Speaker 11: were extremely disempowering and concerning. They described a vision for

581
00:29:27,360 --> 00:29:30,040
Speaker 11: the future that I do not think is going to work,

582
00:29:30,280 --> 00:29:32,960
Speaker 11: and I don't think that Venezuelans are going to feel

583
00:29:33,000 --> 00:29:35,400
Speaker 11: that that is there is the right frame.

584
00:29:35,560 --> 00:29:38,320
Speaker 3: Professor Hausman, thank you so much for leading our coverage

585
00:29:38,360 --> 00:29:41,800
Speaker 3: this morning. Ricardo Housman with the Kennedy School, Harvard, and

586
00:29:41,800 --> 00:29:45,840
Speaker 3: of course look to his piercing essay and the economists

587
00:29:46,000 --> 00:29:50,160
Speaker 3: stay with us. More from Bloomberg Surveillance coming up after this.

588
00:29:57,440 --> 00:30:01,000
Speaker 1: You're listening to the Bloomberg Surveillance podcast. Catch us live

589
00:30:01,080 --> 00:30:04,240
Speaker 1: weekday afternoons from seven to ten am Eastern Listen on

590
00:30:04,320 --> 00:30:08,000
Speaker 1: Applecarplay and Android Otto with the Bloomberg Business app, or

591
00:30:08,120 --> 00:30:09,240
Speaker 1: watch us live on.

592
00:30:09,160 --> 00:30:10,680
Speaker 2: YouTube anticipated here.

593
00:30:10,720 --> 00:30:14,840
Speaker 3: Of course, with all the geopolitics and international relations put

594
00:30:14,880 --> 00:30:17,160
Speaker 3: to the wayside, to a Tuesday Troy Gyski.

595
00:30:17,480 --> 00:30:19,280
Speaker 2: One of our first conversations of.

596
00:30:19,280 --> 00:30:23,080
Speaker 3: The year with Future Standard is well, one of the

597
00:30:23,120 --> 00:30:26,160
Speaker 3: great charms of Troy Gyski is you need to be

598
00:30:26,320 --> 00:30:27,080
Speaker 3: in the market.

599
00:30:27,440 --> 00:30:29,840
Speaker 2: I never hear you saying go to cash. Have you

600
00:30:29,880 --> 00:30:31,320
Speaker 2: ever said go to cash?

601
00:30:31,640 --> 00:30:35,920
Speaker 12: Well, I think if you look historically, it's I honestly

602
00:30:35,920 --> 00:30:38,560
Speaker 12: can't remember, Tom, because if you think of the post

603
00:30:38,640 --> 00:30:43,560
Speaker 12: GFC era, right, hoarding cash is tipically been a losing bet,

604
00:30:44,040 --> 00:30:46,120
Speaker 12: and initially so much of that was driven by que

605
00:30:46,520 --> 00:30:49,240
Speaker 12: and Montrey, Splyby and pump Top. And even though you

606
00:30:49,280 --> 00:30:51,600
Speaker 12: used to joke around about tripper level cash, I don't

607
00:30:51,600 --> 00:30:53,360
Speaker 12: know if you remember the triple what are you laughing

608
00:30:53,400 --> 00:30:54,440
Speaker 12: about it?

609
00:30:54,920 --> 00:30:57,440
Speaker 2: They took one hundred and eighty basis points this year.

610
00:30:58,000 --> 00:31:00,560
Speaker 9: Levern cash at cash barring rates is a trade.

611
00:31:00,600 --> 00:31:04,600
Speaker 12: But really like you, but you know, putting cash to work,

612
00:31:04,960 --> 00:31:07,080
Speaker 12: and we do think that's one of the biggest challenges

613
00:31:07,120 --> 00:31:09,680
Speaker 12: for investors now is how do you put those massive

614
00:31:09,720 --> 00:31:13,160
Speaker 12: cash hoards and money markets, savings accounts, et cetera to

615
00:31:13,240 --> 00:31:16,120
Speaker 12: work where it can meaningfully increase total return and income

616
00:31:16,480 --> 00:31:19,240
Speaker 12: without taking uncomfort levels of risk. And that's one of

617
00:31:19,240 --> 00:31:21,360
Speaker 12: the key attributes of alternatives is you know, whether it's

618
00:31:21,400 --> 00:31:24,520
Speaker 12: private credit, private real estate lending, or even private equity.

619
00:31:24,680 --> 00:31:26,560
Speaker 9: If you have more of a growth bend, and.

620
00:31:26,520 --> 00:31:30,000
Speaker 5: I know you have a focus these days on private markets,

621
00:31:30,000 --> 00:31:33,200
Speaker 5: private equity, private credit. That is, an average investor, what's

622
00:31:33,200 --> 00:31:35,800
Speaker 5: the best way to get exposure to that asset class.

623
00:31:35,840 --> 00:31:38,120
Speaker 12: Yes, So the way the industry has evolved, right is

624
00:31:38,240 --> 00:31:40,920
Speaker 12: we've democratized to some extent. So it used to be

625
00:31:41,000 --> 00:31:43,560
Speaker 12: really all about large sovereign wealth funds or large pension

626
00:31:43,560 --> 00:31:46,800
Speaker 12: funds or endowments, and so we've created these evergreen vehicles,

627
00:31:46,840 --> 00:31:50,280
Speaker 12: which are registered investment corporations, which allows smaller investors to

628
00:31:50,320 --> 00:31:53,000
Speaker 12: also partake. And to put it in the big picture,

629
00:31:53,200 --> 00:31:55,280
Speaker 12: if you look at the major wealth firms, you're somewhere

630
00:31:55,320 --> 00:31:58,200
Speaker 12: between one and a half and seven percent penetration and

631
00:31:58,280 --> 00:32:00,720
Speaker 12: all their targets are somewhere between twenty and thirty. So

632
00:32:00,720 --> 00:32:03,960
Speaker 12: we're really in the very early evenings of this democratization wave.

633
00:32:04,240 --> 00:32:07,360
Speaker 5: What do you think is a reasonable allocation for alternatives

634
00:32:07,360 --> 00:32:11,000
Speaker 5: in an average investors portfolio? Like I used to think

635
00:32:11,000 --> 00:32:13,560
Speaker 5: it was low single digits, but I hear Rias tell

636
00:32:13,640 --> 00:32:14,720
Speaker 5: me much higher than that.

637
00:32:14,800 --> 00:32:17,840
Speaker 12: Yeah, much higher I think most firms are guiding folks

638
00:32:17,960 --> 00:32:21,400
Speaker 12: meeting wealth management firms that ultimately control the acid allocation decisions.

639
00:32:21,560 --> 00:32:25,640
Speaker 12: So somewhere around twenty to thirty percent. You don't want

640
00:32:25,640 --> 00:32:27,920
Speaker 12: to go to eighty or ninety per se because you

641
00:32:27,960 --> 00:32:30,800
Speaker 12: need liquidity, and the whole idea is to increase that

642
00:32:31,080 --> 00:32:35,520
Speaker 12: efficient frontier, have that better risk adjuster return truck, I

643
00:32:35,520 --> 00:32:36,200
Speaker 12: asked you where.

644
00:32:36,080 --> 00:32:38,320
Speaker 2: This was fifture with us this morning.

645
00:32:38,360 --> 00:32:40,360
Speaker 3: We welcome all of you across the nation the way

646
00:32:40,360 --> 00:32:44,480
Speaker 3: you listen to Bloomberg's Surveillance. Good morning on Serious XM

647
00:32:44,520 --> 00:32:47,840
Speaker 3: on Spotify. I didn't realize this, Like we're a podcast.

648
00:32:48,120 --> 00:32:51,400
Speaker 2: Yeah, on Spotify. It's huge in the Pacific rip absolutely.

649
00:32:51,400 --> 00:32:52,360
Speaker 2: We have a consultant.

650
00:32:52,520 --> 00:32:52,680
Speaker 3: Ray.

651
00:32:52,760 --> 00:32:55,320
Speaker 2: YouTube has really helped us with all this and races.

652
00:32:55,560 --> 00:32:56,560
Speaker 2: It's like ginormous.

653
00:32:56,680 --> 00:33:00,640
Speaker 3: We say good morning and on YouTube subscribe to Bloomberg Podcast.

654
00:33:00,720 --> 00:33:03,200
Speaker 3: I got a new thing. I'm trying to figure out

655
00:33:03,200 --> 00:33:05,280
Speaker 3: how to put out the three big interviews of the

656
00:33:05,400 --> 00:33:09,440
Speaker 3: day the next day. Sera are YouTube's helping me. Oh

657
00:33:09,480 --> 00:33:12,320
Speaker 3: she's smart, She's gone down in flames so far. But

658
00:33:12,440 --> 00:33:14,320
Speaker 3: I'll get there and get there, Troy.

659
00:33:14,360 --> 00:33:16,360
Speaker 5: A lot of folks are wondering, can we have a

660
00:33:16,600 --> 00:33:20,680
Speaker 5: fourth consecutive year of double digit growth in public equity returns?

661
00:33:20,800 --> 00:33:21,600
Speaker 4: How do you think about that?

662
00:33:22,000 --> 00:33:24,520
Speaker 12: Yeah, so it's gonna be a little more challenging this year,

663
00:33:24,600 --> 00:33:27,600
Speaker 12: mainly given where starting multiples are and the fact that

664
00:33:27,680 --> 00:33:31,480
Speaker 12: money supplied isn't as excessive relative to nomenal GDP as

665
00:33:31,480 --> 00:33:33,200
Speaker 12: it had been. You know, that was one of the

666
00:33:33,200 --> 00:33:35,600
Speaker 12: things from a multiple expansion standpoint I was starting to

667
00:33:35,600 --> 00:33:36,280
Speaker 12: get a little.

668
00:33:36,040 --> 00:33:36,840
Speaker 2: More concerned about.

669
00:33:37,160 --> 00:33:38,680
Speaker 12: And then tom as you know, when you know it,

670
00:33:38,680 --> 00:33:40,320
Speaker 12: the FED comes in and pumps in one hundred and

671
00:33:40,320 --> 00:33:41,360
Speaker 12: twenty billion dollars.

672
00:33:41,120 --> 00:33:44,120
Speaker 9: The fresh liquidity. You know, so you have this spread compressing.

673
00:33:44,200 --> 00:33:46,600
Speaker 12: But if you look at Ernie's growth, it's hard to

674
00:33:46,600 --> 00:33:48,600
Speaker 12: figure out how you get less than twelve, you know,

675
00:33:48,640 --> 00:33:49,200
Speaker 12: market served?

676
00:33:49,280 --> 00:33:52,480
Speaker 2: Really, you're your twelve? Is your's on?

677
00:33:52,680 --> 00:33:54,880
Speaker 12: Yeah, well, twelve would arguably be even more of a

678
00:33:54,880 --> 00:33:57,960
Speaker 12: bare case. Right, So the estimate is fifteen roughly give

679
00:33:58,000 --> 00:34:00,760
Speaker 12: for the SMP. And when you think about how strong

680
00:34:00,840 --> 00:34:04,160
Speaker 12: nominal GDP growth continues to be, you know, real GDP

681
00:34:04,320 --> 00:34:06,440
Speaker 12: plus inflation, revenue.

682
00:34:06,040 --> 00:34:08,480
Speaker 9: Should be strong, Earning should be strong, and so.

683
00:34:08,440 --> 00:34:10,880
Speaker 12: Whether it's public equity or private equity, it looks like

684
00:34:10,920 --> 00:34:11,480
Speaker 12: good upside.

685
00:34:11,560 --> 00:34:14,719
Speaker 3: So it's good upside and you're all in, like Belski is,

686
00:34:14,760 --> 00:34:15,480
Speaker 3: I mean, what does he know?

687
00:34:15,560 --> 00:34:18,759
Speaker 9: It's not get carried away, but.

688
00:34:18,719 --> 00:34:22,560
Speaker 3: You're all in on the stimulus in the June and

689
00:34:22,719 --> 00:34:26,800
Speaker 3: July and August. Pray tell what happens after the Trump

690
00:34:26,880 --> 00:34:30,400
Speaker 3: stimulus into the mid terms. Well, so go to cash

691
00:34:30,520 --> 00:34:31,080
Speaker 3: labor Day.

692
00:34:31,480 --> 00:34:33,399
Speaker 9: I would not recommend triple ever cast.

693
00:34:33,440 --> 00:34:37,440
Speaker 12: It's for the record, but if you think of the seasonality,

694
00:34:37,480 --> 00:34:40,960
Speaker 12: obviously January December of strong months. But it's very difficult

695
00:34:41,000 --> 00:34:43,680
Speaker 12: for an average investor to time that, even institutions time that.

696
00:34:44,239 --> 00:34:45,880
Speaker 9: So you want to be fully invested.

697
00:34:45,920 --> 00:34:48,120
Speaker 12: The question is how much do you have an alternatives

698
00:34:48,160 --> 00:34:51,040
Speaker 12: to complement any downside that you could get you in.

699
00:34:51,840 --> 00:34:53,680
Speaker 2: Do you buy this kool aid? Well, I think that's

700
00:34:53,760 --> 00:34:56,200
Speaker 2: credit equity private credit in my IRA.

701
00:34:57,320 --> 00:34:59,120
Speaker 4: Yeah, it's just the allocation. I don't have a problem

702
00:34:59,120 --> 00:34:59,279
Speaker 4: with that.

703
00:34:59,440 --> 00:35:01,520
Speaker 5: Somebody alltions that you guys are talking about it much

704
00:35:01,560 --> 00:35:03,799
Speaker 5: higher than I would have thought. But I mean from

705
00:35:03,800 --> 00:35:08,880
Speaker 5: evaluation perspective, you can get arguably much better evaluations in

706
00:35:08,880 --> 00:35:09,440
Speaker 5: a private.

707
00:35:09,239 --> 00:35:10,560
Speaker 4: Market than you can a public market.

708
00:35:10,560 --> 00:35:11,040
Speaker 13: In these dases.

709
00:35:11,120 --> 00:35:13,319
Speaker 12: Yeah, I mean that's one of the biggest disconnects right now,

710
00:35:13,360 --> 00:35:15,399
Speaker 12: particularly in the Russell two thousands. So if you think

711
00:35:15,400 --> 00:35:18,240
Speaker 12: of the use case for middle market private equity in particular,

712
00:35:18,320 --> 00:35:21,480
Speaker 12: it's really been a substitute or compliment for the Russell,

713
00:35:21,560 --> 00:35:24,160
Speaker 12: because the Russell is roughly nineteen times evd BA dah,

714
00:35:24,440 --> 00:35:27,200
Speaker 12: middle market private equity is roughly eleven. Now our books

715
00:35:27,200 --> 00:35:30,000
Speaker 12: priced a little more expensively because the better growth prospects,

716
00:35:30,320 --> 00:35:33,080
Speaker 12: but you're effectively getting that growth at a reasonable price.

717
00:35:33,520 --> 00:35:36,080
Speaker 12: And not only do you have better convexity and upside,

718
00:35:36,560 --> 00:35:38,400
Speaker 12: but you also have less downside in the event we

719
00:35:38,440 --> 00:35:39,480
Speaker 12: get that correction scenario.

720
00:35:39,760 --> 00:35:42,400
Speaker 2: He doesn't talk to Randall Forsyth at barons like this.

721
00:35:43,400 --> 00:35:44,919
Speaker 2: What did you say? Convexity?

722
00:35:45,239 --> 00:35:49,320
Speaker 12: Yeah, convexity so more upside than downside, right, that's the

723
00:35:49,360 --> 00:35:53,359
Speaker 12: second derivative, as you know of the delta. But yeah,

724
00:35:53,760 --> 00:35:56,520
Speaker 12: convexy's hard to find in a market right now. But

725
00:35:56,560 --> 00:36:01,240
Speaker 12: when you're at eleven times forward or eleven times forward ebitdah,

726
00:36:01,480 --> 00:36:04,319
Speaker 12: and you have ten to twelve percent revenue growth, that

727
00:36:04,440 --> 00:36:06,040
Speaker 12: tends to lead strong outcomes.

728
00:36:06,120 --> 00:36:08,880
Speaker 3: Amid all this jargon, folks, Lisa just threw a gluten

729
00:36:09,040 --> 00:36:11,200
Speaker 3: free role at him.

730
00:36:11,560 --> 00:36:14,640
Speaker 2: Amid all this jargon. What you talked about, This key

731
00:36:14,840 --> 00:36:18,400
Speaker 2: is revenue growth. Yes, if we have nominal GDP popping

732
00:36:18,560 --> 00:36:19,280
Speaker 2: like it's popping.

733
00:36:20,440 --> 00:36:24,960
Speaker 3: The normal industrial company making four percent five percent revenue growth,

734
00:36:25,000 --> 00:36:28,280
Speaker 3: maybe they one year they get seven percent. Everybody gets paid.

735
00:36:28,560 --> 00:36:30,480
Speaker 3: All those numbers are bigger now right.

736
00:36:30,320 --> 00:36:32,480
Speaker 12: Well, that's one hundred percent, Tom, that's such a big

737
00:36:32,520 --> 00:36:35,960
Speaker 12: shift from the period after the GFC where one and

738
00:36:35,960 --> 00:36:37,840
Speaker 12: a half percent real and one and a half percent

739
00:36:37,880 --> 00:36:40,560
Speaker 12: inflation was. It was not necessarily the new normal, but

740
00:36:40,680 --> 00:36:42,479
Speaker 12: remember it was the new normal for a long time.

741
00:36:43,080 --> 00:36:46,200
Speaker 12: Post pandemic, we've been more like six seven eight percent

742
00:36:46,280 --> 00:36:51,440
Speaker 12: annualized nominal GDP growth Q three blockbuster eight percent annualized

743
00:36:51,480 --> 00:36:54,840
Speaker 12: GDP growth from a nominal standpoint, and that's what drives revenue.

744
00:36:54,880 --> 00:36:57,120
Speaker 12: So if you're if you're long private credit, you're long

745
00:36:57,160 --> 00:36:59,160
Speaker 12: public credit, you're long private equity, you're a.

746
00:36:59,120 --> 00:36:59,920
Speaker 9: Long public equity.

747
00:37:00,480 --> 00:37:03,480
Speaker 12: Nominal GDP is what drives revenue growth, and it all

748
00:37:03,520 --> 00:37:04,160
Speaker 12: starts there.

749
00:37:04,880 --> 00:37:08,800
Speaker 5: So we've got twelve thirteen, fourteen percent EPs growth and

750
00:37:08,880 --> 00:37:11,040
Speaker 5: the S and P five hundred for twenty twenty six.

751
00:37:12,920 --> 00:37:14,600
Speaker 4: Is that enough for this market in this valuation?

752
00:37:14,680 --> 00:37:15,560
Speaker 2: You think so?

753
00:37:15,640 --> 00:37:19,160
Speaker 9: Twenty two point one times S and P. That's obviously

754
00:37:19,239 --> 00:37:20,560
Speaker 9: on the richer end of the range.

755
00:37:21,080 --> 00:37:24,080
Speaker 12: The main driver of multiple expansions since October of twenty

756
00:37:24,080 --> 00:37:26,640
Speaker 12: two or even prior to that is excess money supply

757
00:37:26,719 --> 00:37:30,600
Speaker 12: relative to nominal GDP sorry relative nomal GP and also

758
00:37:30,760 --> 00:37:36,200
Speaker 12: the extraction of public equity share buybacks always outstrip you know,

759
00:37:36,239 --> 00:37:39,480
Speaker 12: any IPOs or secondary offerings, plus run a big merger

760
00:37:39,520 --> 00:37:43,120
Speaker 12: wave definitice merger wave. So that should continue. But given

761
00:37:43,160 --> 00:37:45,560
Speaker 12: that the excess and money supply isn't as great, I

762
00:37:45,600 --> 00:37:47,960
Speaker 12: think you'd be a little aggressive to expect multiples to

763
00:37:48,000 --> 00:37:50,960
Speaker 12: go from twenty two point one to twenty three unlikely

764
00:37:50,960 --> 00:37:54,759
Speaker 12: to get multiple depression smadge a multiple expansion plus the

765
00:37:54,800 --> 00:37:55,959
Speaker 12: earnings growth I mean.

766
00:37:56,160 --> 00:37:59,839
Speaker 3: Here, I just bring up a representative tooth based company

767
00:38:00,200 --> 00:38:02,680
Speaker 3: times earnings yep, yeah, for stuff that comes out of

768
00:38:02,680 --> 00:38:03,200
Speaker 3: it too.

769
00:38:03,680 --> 00:38:06,799
Speaker 12: Grows less, you know gross g and by the way, tom,

770
00:38:06,800 --> 00:38:09,040
Speaker 12: if I may back to growth at a reasonable price,

771
00:38:09,480 --> 00:38:12,280
Speaker 12: you know, typically companies like that are only grown revenue

772
00:38:12,480 --> 00:38:15,520
Speaker 12: like one to five percent exactly, and so you know,

773
00:38:15,840 --> 00:38:19,160
Speaker 12: true in a nominal GDP environment, you'll get that's higher,

774
00:38:19,160 --> 00:38:22,200
Speaker 12: you'll get better revenue growth. But these stable mature companies

775
00:38:22,320 --> 00:38:25,480
Speaker 12: can't do ten, twelve, fourteen, fifteen percent GF revenue growth.

776
00:38:25,600 --> 00:38:28,200
Speaker 2: GFC is not about no more Garcia party. It's about,

777
00:38:28,360 --> 00:38:28,799
Speaker 2: you know the thing.

778
00:38:29,040 --> 00:38:32,000
Speaker 3: So I'm in this bar and Davos years ago, and

779
00:38:32,360 --> 00:38:35,279
Speaker 3: Scaramucci's pouring me a wine from the Rhan Valley, some

780
00:38:35,440 --> 00:38:38,560
Speaker 3: common hermitage thing that I couldn't afford, best glass of

781
00:38:38,600 --> 00:38:41,600
Speaker 3: wine I've ever had, And I turned around in Gaysky's there.

782
00:38:42,480 --> 00:38:46,319
Speaker 3: We didn't see eighth nine coming. We were sitting in

783
00:38:46,320 --> 00:38:49,680
Speaker 3: that star in Davos. We didn't see it coming. For

784
00:38:49,719 --> 00:38:53,160
Speaker 3: our listeners and viewers who are going, Okay, it's gonna

785
00:38:53,160 --> 00:38:55,880
Speaker 3: happen again, we can't see it coming. What do you

786
00:38:55,920 --> 00:38:59,520
Speaker 3: tell them besides have a glass of overpriced Scaramuci wine.

787
00:38:59,680 --> 00:39:02,160
Speaker 12: Well, it's never bad to have good wine to start with,

788
00:39:03,160 --> 00:39:06,200
Speaker 12: especially in the evening at Davos. However, when you look

789
00:39:06,239 --> 00:39:09,080
Speaker 12: at the conditions that are necessary and sufficient for a

790
00:39:09,120 --> 00:39:12,880
Speaker 12: global financial crisis, remember you had a dramatically over levered

791
00:39:12,880 --> 00:39:15,520
Speaker 12: consumer one hundred and thirty one hundred and thirty one

792
00:39:16,400 --> 00:39:21,279
Speaker 12: debt to income. Now it's roughly ninety four percent. Not

793
00:39:21,320 --> 00:39:24,440
Speaker 12: only have we declined dramatically, but since the end of

794
00:39:24,480 --> 00:39:28,920
Speaker 12: twenty two, consumer debt to nominal income has dropped by

795
00:39:29,000 --> 00:39:31,480
Speaker 12: eight percent. That's a huge number, so you have a

796
00:39:31,560 --> 00:39:34,799
Speaker 12: much more stable consumer. Obviously, the housing market's much more

797
00:39:34,840 --> 00:39:38,239
Speaker 12: stable as well, and the banking system is completely delevered.

798
00:39:38,600 --> 00:39:41,640
Speaker 12: So periodically this concern comes up. We think it's sub

799
00:39:41,680 --> 00:39:42,879
Speaker 12: one percent probability.

800
00:39:42,920 --> 00:39:45,360
Speaker 2: I got to get this in Ned Ludlow rocking it

801
00:39:45,400 --> 00:39:48,239
Speaker 2: today out at CES. Have you been to CES? I

802
00:39:48,320 --> 00:39:49,440
Speaker 2: have not been?

803
00:39:49,560 --> 00:39:53,080
Speaker 3: Yeah, either, having the Belajio breakfast right now. He has

804
00:39:53,120 --> 00:39:55,800
Speaker 3: mister Wang at the one o'clock Goward at eleven o'clock,

805
00:39:56,320 --> 00:40:01,080
Speaker 3: he has what your MIT is all about, the leadership

806
00:40:01,120 --> 00:40:05,160
Speaker 3: of AMD. Miss Sue grew up in Queen's really basic,

807
00:40:05,760 --> 00:40:08,359
Speaker 3: ended up with three. She did better at MIT than

808
00:40:08,400 --> 00:40:08,799
Speaker 3: you did.

809
00:40:09,560 --> 00:40:13,080
Speaker 9: Okay, she's probably smarter than me, you know, But.

810
00:40:13,200 --> 00:40:16,439
Speaker 2: Tell us what it's like as a kid coming out

811
00:40:16,440 --> 00:40:21,799
Speaker 2: of Queens, New York, the intimidation of Robert Solo and

812
00:40:22,040 --> 00:40:25,080
Speaker 2: Edgerton's MIT. It just must be I can't. I can't

813
00:40:25,080 --> 00:40:25,640
Speaker 2: imagine that.

814
00:40:26,080 --> 00:40:28,720
Speaker 12: Well, I'll say it's a humbling experience, tom right, because

815
00:40:29,040 --> 00:40:31,680
Speaker 12: typically when you go there, you've always done well in school,

816
00:40:31,760 --> 00:40:34,919
Speaker 12: You've had good board scores. I hate to use this term,

817
00:40:34,960 --> 00:40:37,279
Speaker 12: but you used to be at least one of the

818
00:40:37,320 --> 00:40:39,759
Speaker 12: smarter people in the room, and then you show up

819
00:40:39,760 --> 00:40:43,439
Speaker 12: on MIT and it's like everybody's a genius and you're

820
00:40:43,480 --> 00:40:46,080
Speaker 12: getting like overwhelmed by just the workload.

821
00:40:46,239 --> 00:40:46,439
Speaker 10: Right.

822
00:40:46,520 --> 00:40:50,120
Speaker 12: That was, and I think particularly public schools prepare people well,

823
00:40:50,520 --> 00:40:54,640
Speaker 12: but you're just not used to that NonStop intense activity

824
00:40:54,120 --> 00:40:57,000
Speaker 12: in Yeah, and then it's also very competitive, right, because

825
00:40:57,040 --> 00:41:00,120
Speaker 12: everything's graded on a curve, so it's like, whoa, you

826
00:41:00,440 --> 00:41:02,400
Speaker 12: have to really mature fast.

827
00:41:02,120 --> 00:41:04,920
Speaker 4: And engineering I would have done like English Lit.

828
00:41:05,120 --> 00:41:09,000
Speaker 2: That's no, she did, and Lisa soon shaped electrical engineering.

829
00:41:09,120 --> 00:41:11,440
Speaker 9: Yeah, challenge Yeah, CORSEIX so course six.

830
00:41:11,640 --> 00:41:11,920
Speaker 10: Yeah.

831
00:41:12,040 --> 00:41:14,319
Speaker 3: She she used to take the Wheatstone bridge across from

832
00:41:14,360 --> 00:41:16,520
Speaker 3: Queen's I ask you, thank you.

833
00:41:16,520 --> 00:41:18,680
Speaker 2: So much for wisdom her stay with us.

834
00:41:18,920 --> 00:41:22,160
Speaker 3: More from Bloomberg Surveillance coming up after this.

835
00:41:29,400 --> 00:41:33,000
Speaker 1: You're listening to the Bloomberg Surveillance podcast. Catch us live

836
00:41:33,040 --> 00:41:36,200
Speaker 1: weekday afternoons from seven to ten am Eastern Listen on

837
00:41:36,280 --> 00:41:39,960
Speaker 1: Applecarplay and Android Otto with the Bloomberg Business app, or

838
00:41:40,120 --> 00:41:41,600
Speaker 1: watch us live on YouTube.

839
00:41:41,680 --> 00:41:44,200
Speaker 3: She is Senior Vice President of the Consul and Foreign Relation.

840
00:41:44,800 --> 00:41:48,360
Speaker 3: She is my most definitive voice on Latin America. Shannon,

841
00:41:48,400 --> 00:41:51,160
Speaker 3: I have tattooed to my brain the last time you

842
00:41:51,200 --> 00:41:55,319
Speaker 3: were with us, and you were hugely skeptical that we

843
00:41:55,400 --> 00:41:58,720
Speaker 3: could write and that the Venezuelan people could quote unquote

844
00:41:58,800 --> 00:42:02,560
Speaker 3: do it themselves to rebuild. Give us an update after

845
00:42:02,640 --> 00:42:06,160
Speaker 3: these events. What do the people of Venezuela need to do?

846
00:42:07,480 --> 00:42:07,640
Speaker 2: Well?

847
00:42:07,680 --> 00:42:09,520
Speaker 13: This is the real challenge, right. We've seen just in

848
00:42:09,520 --> 00:42:13,120
Speaker 13: the last seventy two hours, the new regime led by

849
00:42:13,200 --> 00:42:17,000
Speaker 13: the previous vice president now the president of Venezuela, cracking

850
00:42:17,040 --> 00:42:19,960
Speaker 13: down on journalists on any sort of opposition. We really

851
00:42:20,000 --> 00:42:23,680
Speaker 13: haven't seen many protests or return to the streets, in

852
00:42:23,680 --> 00:42:25,560
Speaker 13: part because many of those people have left. We have

853
00:42:25,600 --> 00:42:27,880
Speaker 13: over eight million Venezuelans who have left in our elsewhere,

854
00:42:27,880 --> 00:42:32,399
Speaker 13: including Nobel Laureate Maria Corina Machado, including the man who

855
00:42:32,520 --> 00:42:34,880
Speaker 13: stood up for president and by all accounts won the

856
00:42:34,880 --> 00:42:35,920
Speaker 13: twenty twenty four elections.

857
00:42:35,960 --> 00:42:37,120
Speaker 4: So it's been quite subdued.

858
00:42:37,480 --> 00:42:40,239
Speaker 13: And the guns, the you know, repressive forces are out

859
00:42:40,280 --> 00:42:40,800
Speaker 13: on the streets.

860
00:42:40,840 --> 00:42:42,200
Speaker 4: So what do they need to do.

861
00:42:42,600 --> 00:42:45,480
Speaker 13: They need to rally, but it's very hard to do given.

862
00:42:45,280 --> 00:42:47,959
Speaker 2: This hardarell for guns pointed at your head.

863
00:42:48,120 --> 00:42:49,359
Speaker 13: That's the challenge, right, Hey.

864
00:42:49,320 --> 00:42:52,880
Speaker 2: Ricardo Houseman, cut right to it, right, Paul, Yeah, absolutely So.

865
00:42:52,960 --> 00:42:56,240
Speaker 5: I mean, I guess one of the questions this seems

866
00:42:56,239 --> 00:42:59,000
Speaker 5: like that Trump administration believes they can exert some influence

867
00:42:59,040 --> 00:43:00,800
Speaker 5: on this Venus whaling government.

868
00:43:01,000 --> 00:43:02,600
Speaker 4: How do you do you think that can play out?

869
00:43:03,200 --> 00:43:05,080
Speaker 13: I mean, I think they can exert some influence, but

870
00:43:05,080 --> 00:43:07,600
Speaker 13: we really haven't heard from the Trump administration and interest

871
00:43:07,640 --> 00:43:10,120
Speaker 13: in return to democracy, right, Those haven't been the words

872
00:43:10,160 --> 00:43:11,399
Speaker 13: coming from the President, from the.

873
00:43:11,360 --> 00:43:12,240
Speaker 4: Secretary of State.

874
00:43:12,480 --> 00:43:15,959
Speaker 13: They've talked about reviving the oil industry. They have talked about,

875
00:43:16,040 --> 00:43:19,239
Speaker 13: you know, bringing stability to Venezuela, but they haven't really

876
00:43:19,239 --> 00:43:20,320
Speaker 13: talked about democracy.

877
00:43:20,400 --> 00:43:22,239
Speaker 3: I got to get this question into because I need

878
00:43:22,239 --> 00:43:25,000
Speaker 3: to be rude to doctor O'Neil this morning. Have you

879
00:43:25,120 --> 00:43:29,720
Speaker 3: spoken to anyone within the Trump administration of your expertise

880
00:43:29,880 --> 00:43:32,960
Speaker 3: on Venezuela, Guyana and everything South.

881
00:43:33,640 --> 00:43:35,720
Speaker 13: I have not been speaking to them these last few days.

882
00:43:36,040 --> 00:43:39,640
Speaker 2: That's half the problem probably, So I don't know.

883
00:43:40,040 --> 00:43:43,439
Speaker 4: Open ending question here, how do you think this plays out?

884
00:43:43,560 --> 00:43:45,560
Speaker 4: I mean, I'm not sure much is going.

885
00:43:45,360 --> 00:43:46,719
Speaker 5: To change here, I guess is what a lot of

886
00:43:46,760 --> 00:43:49,520
Speaker 5: people are starting to come to the conclusion and maybe

887
00:43:49,680 --> 00:43:50,839
Speaker 5: not a lot it's going to change here.

888
00:43:51,120 --> 00:43:54,120
Speaker 13: I think there's sort of two scenarios. One is that,

889
00:43:54,239 --> 00:43:55,920
Speaker 13: as you say, not a lot changes. We have a

890
00:43:55,960 --> 00:43:59,040
Speaker 13: new leadership head, but not a regime change. Lots of

891
00:43:59,040 --> 00:44:03,080
Speaker 13: the other pieces stay in place as they are now,

892
00:44:03,160 --> 00:44:04,880
Speaker 13: you know, oil and others. You know, there may be

893
00:44:05,000 --> 00:44:06,920
Speaker 13: US players who come in though it's still kind of

894
00:44:06,960 --> 00:44:09,799
Speaker 13: a shaky market and the infrastructure is very weak after

895
00:44:09,960 --> 00:44:11,560
Speaker 13: years and years of sort of degradation.

896
00:44:11,920 --> 00:44:12,719
Speaker 6: So one is sort of.

897
00:44:12,680 --> 00:44:16,040
Speaker 13: As you say, stability, continuing, new figurehead, but not alloted changed.

898
00:44:16,440 --> 00:44:20,000
Speaker 13: The other is that, you know, the current president, Delcia Rodriguez,

899
00:44:20,360 --> 00:44:22,920
Speaker 13: she isn't able to keep all of these forces right,

900
00:44:22,920 --> 00:44:25,839
Speaker 13: the various different groups with guns together and we get

901
00:44:25,880 --> 00:44:28,800
Speaker 13: sort of a fragmentation, disintegration and a lot of violence.

902
00:44:29,040 --> 00:44:31,200
Speaker 2: Vinstaville, you met with Elcia Rodriguez.

903
00:44:31,440 --> 00:44:33,000
Speaker 13: I haven't no, because you're the.

904
00:44:32,920 --> 00:44:35,480
Speaker 3: One person I think what Delcia Rodriguez is like twenty

905
00:44:35,520 --> 00:44:38,480
Speaker 3: eight to thirty years old. She and her mother take

906
00:44:38,520 --> 00:44:42,640
Speaker 3: over the Venezuelan embassy in London a million years ago.

907
00:44:42,840 --> 00:44:45,560
Speaker 2: Is part of the Socialist protest. I mean, she's like

908
00:44:45,640 --> 00:44:46,600
Speaker 2: the real deal.

909
00:44:46,360 --> 00:44:49,080
Speaker 4: Within the Socialist she was chief of staff to Ugo Chavez.

910
00:44:49,120 --> 00:44:51,880
Speaker 13: I mean she has a long history with this movement.

911
00:44:51,520 --> 00:44:53,240
Speaker 2: And she knows all the players.

912
00:44:53,239 --> 00:44:55,400
Speaker 13: Is yeah, and she's been a player for a long time.

913
00:44:55,360 --> 00:44:57,279
Speaker 3: Right, Shannon on you know, with us the Console Foreign

914
00:44:57,320 --> 00:45:01,160
Speaker 3: Relations after Ricardo Hausman of Harvard Tip brief Global Wall

915
00:45:01,239 --> 00:45:03,759
Speaker 3: Street on these events in Venezuela.

916
00:45:03,960 --> 00:45:05,520
Speaker 2: Paul screening with doctor O'Neill.

917
00:45:06,120 --> 00:45:09,239
Speaker 5: So, one of the expectations of the Trump administration is

918
00:45:09,239 --> 00:45:11,239
Speaker 5: that major global.

919
00:45:10,920 --> 00:45:13,279
Speaker 4: Oil companies will go into Venezuela.

920
00:45:13,239 --> 00:45:17,279
Speaker 5: And revive their energy infrastructure, creating more supply in.

921
00:45:17,239 --> 00:45:19,480
Speaker 4: The marketplace, keeping oil energy prices down.

922
00:45:19,880 --> 00:45:22,359
Speaker 5: But we've spoken to people saying I'm not so sure

923
00:45:22,400 --> 00:45:25,040
Speaker 5: because that's a it's a lot of money, and B

924
00:45:25,400 --> 00:45:28,000
Speaker 5: it's a long term investment, which means you're banking on

925
00:45:28,760 --> 00:45:31,600
Speaker 5: political stability in that country. It's a tough bet to

926
00:45:31,600 --> 00:45:32,400
Speaker 5: make these days.

927
00:45:32,239 --> 00:45:32,520
Speaker 10: Isn't it.

928
00:45:32,600 --> 00:45:34,120
Speaker 13: I think it's a really tough bet to make, and

929
00:45:34,200 --> 00:45:37,000
Speaker 13: especially if you're a public company, if you have shareholders.

930
00:45:37,000 --> 00:45:39,239
Speaker 13: You know, what we've seen in Venezuela for the last

931
00:45:39,280 --> 00:45:42,680
Speaker 13: twenty five years is really the solidifications of the consolidation

932
00:45:42,760 --> 00:45:45,440
Speaker 13: of crony capitalism. So if you're going in there, and

933
00:45:45,480 --> 00:45:47,680
Speaker 13: we're not yet disrupting some of the you know, the

934
00:45:47,760 --> 00:45:50,680
Speaker 13: bad players, the corruption, the back and forth. So one

935
00:45:50,760 --> 00:45:52,840
Speaker 13: is you need hundreds of billions of dollars in investment

936
00:45:52,880 --> 00:45:54,600
Speaker 13: just to get oil out of the ground and out

937
00:45:54,600 --> 00:45:56,440
Speaker 13: of the ports. Right, there aren't ports that can actually

938
00:45:56,480 --> 00:45:59,520
Speaker 13: do now. But two, who are you working with? You know,

939
00:45:59,600 --> 00:46:01,560
Speaker 13: if we can to a place again in the United

940
00:46:01,600 --> 00:46:04,480
Speaker 13: States where foreign corrept practices act, where other things are

941
00:46:04,480 --> 00:46:07,000
Speaker 13: being enforced, do you really want to be involved with

942
00:46:07,000 --> 00:46:07,920
Speaker 13: some of these characters.

943
00:46:08,160 --> 00:46:10,400
Speaker 3: So you didn't talk to the Trump administration, I have

944
00:46:10,480 --> 00:46:13,120
Speaker 3: no idea what that's about. Have you spoken to mister

945
00:46:13,200 --> 00:46:15,200
Speaker 3: Worth over at Chevron.

946
00:46:15,520 --> 00:46:17,319
Speaker 13: I haven't spoken with him, but I have talked with

947
00:46:17,360 --> 00:46:19,880
Speaker 13: some of the people in the general energy industry.

948
00:46:19,960 --> 00:46:21,000
Speaker 2: How do they ask you?

949
00:46:21,520 --> 00:46:24,440
Speaker 13: So they care about what's going to happen. Chevron has

950
00:46:24,440 --> 00:46:27,080
Speaker 13: been in Venezuela for the long haul, right, and they

951
00:46:27,080 --> 00:46:30,480
Speaker 13: have gotten, you know, exemptions to continue operating. So for them,

952
00:46:30,560 --> 00:46:32,719
Speaker 13: this is a good turn, right, they won't have to

953
00:46:32,719 --> 00:46:36,160
Speaker 13: worry so much about these ongoing exemptions for licenses. But

954
00:46:36,200 --> 00:46:39,360
Speaker 13: I do hear from others who are in this general space,

955
00:46:39,400 --> 00:46:42,120
Speaker 13: both the oil companies, but also the logistics companies, right,

956
00:46:42,120 --> 00:46:44,120
Speaker 13: those who build rigs, those who do other parts.

957
00:46:44,320 --> 00:46:45,520
Speaker 4: There is a worry.

958
00:46:45,640 --> 00:46:48,200
Speaker 13: You know, we're only three days into this. There's a

959
00:46:48,239 --> 00:46:50,680
Speaker 13: worry about this stability and really does it last? And

960
00:46:50,719 --> 00:46:53,919
Speaker 13: you know, oil companies others, they make long, multi year,

961
00:46:54,040 --> 00:46:55,080
Speaker 13: decades long bets.

962
00:46:56,000 --> 00:46:58,320
Speaker 5: What is the news over the last seventy two hours

963
00:46:58,320 --> 00:47:01,840
Speaker 5: meant for just Latin America in general? I mean, is

964
00:47:01,880 --> 00:47:05,480
Speaker 5: everybody else looking over their shoulder these days? We think Cuba, Cuba,

965
00:47:05,600 --> 00:47:07,920
Speaker 5: maybe Columbia and maybe even some other countries.

966
00:47:08,239 --> 00:47:11,719
Speaker 13: I mean, this is a real break in US policy

967
00:47:11,840 --> 00:47:14,440
Speaker 13: writ large for Latin America, for the world.

968
00:47:14,520 --> 00:47:16,560
Speaker 4: Right, we had a policy.

969
00:47:16,080 --> 00:47:18,360
Speaker 13: In the post World War two period that was really about,

970
00:47:18,760 --> 00:47:21,120
Speaker 13: you know, if not loved America wanted to be admired. Right,

971
00:47:21,120 --> 00:47:23,200
Speaker 13: we were a shining city on a hill. And now

972
00:47:23,239 --> 00:47:27,279
Speaker 13: we're back to gunboat diplomacy literally, right, is that we are,

973
00:47:27,480 --> 00:47:29,320
Speaker 13: you know, the mighty We are going to use coercive

974
00:47:29,360 --> 00:47:31,880
Speaker 13: power and it's going to be transactional. So all of

975
00:47:31,880 --> 00:47:34,080
Speaker 13: the countries around Venezuela are thinking about that.

976
00:47:34,160 --> 00:47:36,640
Speaker 2: Globally, no sparks are coming off the wall.

977
00:47:36,640 --> 00:47:39,239
Speaker 3: When Elliott Abrams and Shannon O'Neill are going out of

978
00:47:39,239 --> 00:47:42,040
Speaker 3: the sea, afarre. What is the distinction in the debate

979
00:47:42,120 --> 00:47:44,080
Speaker 3: between you and Elliott Abrams?

980
00:47:44,600 --> 00:47:46,560
Speaker 13: You No, I think the distinction here, And you know,

981
00:47:46,560 --> 00:47:48,640
Speaker 13: Elliott's one of my great colleagues, so you know, I

982
00:47:48,640 --> 00:47:49,640
Speaker 13: have a lot of respect for him.

983
00:47:49,680 --> 00:47:50,000
Speaker 4: I think the.

984
00:47:52,239 --> 00:47:55,400
Speaker 13: We love Elliott, come on, you know, I think the

985
00:47:55,440 --> 00:47:57,480
Speaker 13: distinction here is right. He has worked in the first

986
00:47:57,480 --> 00:48:00,200
Speaker 13: Trump administration. He worked on Venezuela policy in the first.

987
00:48:00,239 --> 00:48:03,320
Speaker 2: Did they call as I hope? So what's the distinction?

988
00:48:03,600 --> 00:48:04,359
Speaker 9: I hope they did too.

989
00:48:04,400 --> 00:48:07,760
Speaker 13: You know, I think the difference here is probably where

990
00:48:07,800 --> 00:48:10,000
Speaker 13: we get and how we get there, right, And there

991
00:48:10,040 --> 00:48:12,520
Speaker 13: is sort of this use of maximal force.

992
00:48:12,640 --> 00:48:17,680
Speaker 2: America wants to get to the weekend? Right, Paul stop,

993
00:48:17,840 --> 00:48:22,000
Speaker 2: stop the show? Should Paul Sweeney keep his reservation in Aruba?

994
00:48:22,080 --> 00:48:24,080
Speaker 13: I think you're good to go now right, the airspace

995
00:48:24,160 --> 00:48:24,719
Speaker 13: is back open.

996
00:48:24,719 --> 00:48:26,919
Speaker 5: I think you're good to weekend? Was a little dicey, yes,

997
00:48:27,120 --> 00:48:29,839
Speaker 5: So what's the next step here? I mean for Venezuela,

998
00:48:30,880 --> 00:48:33,359
Speaker 5: I'm not sure who's who's gonna make the next step?

999
00:48:33,440 --> 00:48:37,080
Speaker 5: Is the US going to try too some policy here?

1000
00:48:37,480 --> 00:48:39,360
Speaker 5: Is Venezuela going to react to the US.

1001
00:48:39,480 --> 00:48:40,560
Speaker 4: What should we be looking for?

1002
00:48:41,040 --> 00:48:44,640
Speaker 13: So I'd be looking for whether Delcia Rodriguez actually consolidates power.

1003
00:48:44,920 --> 00:48:47,480
Speaker 13: Right we saw, you know, last night there were videos

1004
00:48:47,520 --> 00:48:50,880
Speaker 13: of a gunfight happening near the you know, the presidential Palace.

1005
00:48:50,920 --> 00:48:53,560
Speaker 13: You know, is that just you know, a one particular thing,

1006
00:48:53,600 --> 00:48:55,440
Speaker 13: a drone that was flying, or is that sort of

1007
00:48:55,440 --> 00:48:57,359
Speaker 13: a bit of a breakdown of these various I mean

1008
00:48:57,360 --> 00:49:00,000
Speaker 13: there's four or five different types of groups and militia's

1009
00:49:00,120 --> 00:49:02,960
Speaker 13: have guns in Venezuela. Up until recently, they've all been

1010
00:49:03,000 --> 00:49:05,080
Speaker 13: working together. We'll see if that continues. So I would

1011
00:49:05,080 --> 00:49:07,319
Speaker 13: be watching what happens on the ground there and then

1012
00:49:07,320 --> 00:49:10,080
Speaker 13: from Washington, I would be watching, you know, do we

1013
00:49:10,120 --> 00:49:13,200
Speaker 13: see any appetite to go beyond just the snatch and

1014
00:49:13,200 --> 00:49:13,879
Speaker 13: grab that we saw?

1015
00:49:14,160 --> 00:49:18,560
Speaker 3: Ricardo Housman spoke emotionally about his family coming from Europe

1016
00:49:18,640 --> 00:49:21,719
Speaker 3: to Venezuela and all the hardships of World War two

1017
00:49:22,640 --> 00:49:26,080
Speaker 3: for Americans like me, Like literally, I'm so intimidated by

1018
00:49:26,080 --> 00:49:27,320
Speaker 3: Shannon O'Neil, Like I didn't.

1019
00:49:27,080 --> 00:49:27,759
Speaker 2: Get a map out.

1020
00:49:28,320 --> 00:49:31,080
Speaker 3: So Caracas is on the water waving at a Ruba

1021
00:49:31,560 --> 00:49:34,080
Speaker 3: and Currissou in Trinidad.

1022
00:49:33,640 --> 00:49:36,000
Speaker 2: And to Bason right, you go to these places, I

1023
00:49:36,040 --> 00:49:40,719
Speaker 2: have no life. Okay, what's the rest of Venezuela think

1024
00:49:40,800 --> 00:49:42,600
Speaker 2: of all this? You've got the oil to.

1025
00:49:42,600 --> 00:49:45,439
Speaker 3: The west, the oil to the east, and then Guiana. Okay,

1026
00:49:45,480 --> 00:49:47,920
Speaker 3: along the water, I get it. But up in the

1027
00:49:48,080 --> 00:49:50,880
Speaker 3: Andes and then down to the plains and then the

1028
00:49:50,960 --> 00:49:56,560
Speaker 3: tropical nothingness towards Brazil. What do the rest of Venezuela think?

1029
00:49:58,280 --> 00:50:00,640
Speaker 13: What you have seen, especially of these last couple of

1030
00:50:00,680 --> 00:50:03,840
Speaker 13: decades too, especially on the borders, is really lawlessness. And

1031
00:50:03,880 --> 00:50:05,759
Speaker 13: on the Colombian border you've seen you know, the E

1032
00:50:05,920 --> 00:50:08,000
Speaker 13: l N, which is a gorilla group from Columbia really

1033
00:50:08,040 --> 00:50:10,799
Speaker 13: move in and solidify. So there's a lot of contraband

1034
00:50:10,920 --> 00:50:13,719
Speaker 13: and illegal goold and mineral mining and the like. So

1035
00:50:13,719 --> 00:50:16,520
Speaker 13: there's some of those areas that are really lawless. There

1036
00:50:16,520 --> 00:50:19,720
Speaker 13: are other areas that you know, really aren't under central control.

1037
00:50:19,760 --> 00:50:22,439
Speaker 13: So I think a question here. It's worked well under

1038
00:50:22,480 --> 00:50:24,800
Speaker 13: Maduro because they've all sort of worked together, these various

1039
00:50:24,840 --> 00:50:27,399
Speaker 13: arm groups, and there's a live and let live sort

1040
00:50:27,440 --> 00:50:31,040
Speaker 13: of you know, kleptocratic model. The question is what happens now?

1041
00:50:31,080 --> 00:50:34,200
Speaker 13: Does that continue and this you know, business as usual,

1042
00:50:34,360 --> 00:50:36,719
Speaker 13: or do we see a breakdown, Teddy Rouseveld.

1043
00:50:37,800 --> 00:50:40,680
Speaker 9: But maybe it is, you know, but it's not funny.

1044
00:50:40,719 --> 00:50:45,160
Speaker 3: You've just described with all of your professionalism the violence

1045
00:50:45,200 --> 00:50:46,000
Speaker 3: of Venezuela.

1046
00:50:46,200 --> 00:50:48,680
Speaker 2: We're going to drop our men and women into this.

1047
00:50:48,960 --> 00:50:51,760
Speaker 3: Is marines or green berets er what are the modern

1048
00:50:51,760 --> 00:50:53,720
Speaker 3: green berets, seals or whatever.

1049
00:50:54,000 --> 00:50:55,520
Speaker 13: I don't think we are going to drop them in.

1050
00:50:55,600 --> 00:50:57,600
Speaker 13: And that's the thing, right, I think what we have

1051
00:50:57,719 --> 00:51:01,160
Speaker 13: done is is take out Maduro. But I don't see

1052
00:51:01,560 --> 00:51:04,360
Speaker 13: US troops moving in for any long term.

1053
00:51:04,520 --> 00:51:05,839
Speaker 5: What I'm learning, I think a lot of other folks

1054
00:51:05,840 --> 00:51:07,799
Speaker 5: have been learning over the last several days, is there's

1055
00:51:07,400 --> 00:51:13,440
Speaker 5: a large number of people who have left Venezuela. Is

1056
00:51:13,480 --> 00:51:16,960
Speaker 5: there any kind of I know, organization around those people?

1057
00:51:17,000 --> 00:51:18,680
Speaker 5: Is there any movement of those people? There is there

1058
00:51:18,680 --> 00:51:22,399
Speaker 5: any maybe drive from some of that population that drive

1059
00:51:22,520 --> 00:51:24,440
Speaker 5: change in Venezuela? Or those are the folks that just

1060
00:51:25,040 --> 00:51:25,640
Speaker 5: wash their hands.

1061
00:51:26,080 --> 00:51:28,080
Speaker 13: Look, I think you know Ricardo Hasman perhaps and his

1062
00:51:28,160 --> 00:51:29,879
Speaker 13: family is one of these. You know, there are many

1063
00:51:29,880 --> 00:51:32,160
Speaker 13: people who would love to go back to Venezuela. Right,

1064
00:51:32,200 --> 00:51:34,839
Speaker 13: There's there's sort of you know, educated upper classes. Many

1065
00:51:34,840 --> 00:51:36,200
Speaker 13: live in Miami, you live in other parts of the

1066
00:51:36,239 --> 00:51:39,840
Speaker 13: United States. There's millions who are across Latin America, especially

1067
00:51:39,920 --> 00:51:43,520
Speaker 13: South America, Columbia, Peru, Chile, Argentina and the like. I

1068
00:51:43,520 --> 00:51:45,800
Speaker 13: think many would like to go back, but I don't

1069
00:51:45,880 --> 00:51:47,800
Speaker 13: yet in talking to some of this diaspora in the

1070
00:51:47,880 --> 00:51:50,719
Speaker 13: last few days, I don't yet see anybody thinking that

1071
00:51:50,760 --> 00:51:51,480
Speaker 13: this is the moment.

1072
00:51:51,719 --> 00:51:56,320
Speaker 3: Okay, one final question, audible, we got ism yesterday Michael

1073
00:51:56,360 --> 00:51:59,239
Speaker 3: McKee here at Bloomberg or Expert says we're on the

1074
00:51:59,320 --> 00:52:01,920
Speaker 3: cusp of a manufacturing recession.

1075
00:52:02,239 --> 00:52:06,120
Speaker 2: Give us a Shannon O'Neill tariff's.

1076
00:52:05,239 --> 00:52:09,040
Speaker 3: Update on not you know, the emotion and the politics,

1077
00:52:09,239 --> 00:52:14,160
Speaker 3: but on American output. Are tariffs diminishing our output? Is

1078
00:52:14,280 --> 00:52:16,879
Speaker 3: McKinley faced in eighteen ninety eight.

1079
00:52:17,640 --> 00:52:19,839
Speaker 13: Yes, they are diminishing our output. And I think the

1080
00:52:19,840 --> 00:52:23,560
Speaker 13: biggest challenge is that while you know, tariffs create a

1081
00:52:23,600 --> 00:52:26,359
Speaker 13: wall that create protection and a reason to produce here,

1082
00:52:26,719 --> 00:52:30,160
Speaker 13: all of the inputs to create those factories here are tariff,

1083
00:52:30,239 --> 00:52:33,440
Speaker 13: and some of them tariff at very high rates. Aluminum, steel, copper,

1084
00:52:33,440 --> 00:52:36,480
Speaker 13: the things to build the physical infrastructure, and the machines

1085
00:52:36,480 --> 00:52:38,799
Speaker 13: that might be imported from China from other places. So

1086
00:52:39,160 --> 00:52:41,680
Speaker 13: it's hard to stand up. It's more expensive today to

1087
00:52:41,760 --> 00:52:43,680
Speaker 13: stand up a factory, so it's slower coming in.

1088
00:52:43,719 --> 00:52:46,080
Speaker 2: We got to go to the market. Shannon. You know, folks,

1089
00:52:46,120 --> 00:52:48,440
Speaker 2: I'm a member of the Council on Foreign Relations, so I'm.

1090
00:52:48,320 --> 00:52:51,920
Speaker 3: Talking my book. Don't let Kurtz Phelim know this. Okay,

1091
00:52:52,120 --> 00:52:55,040
Speaker 3: but you guys are rocking the magazine. I open the

1092
00:52:55,080 --> 00:52:58,880
Speaker 3: magazine up, okay, Li's economies in the magazine. Yeah. Yeah,

1093
00:52:59,239 --> 00:53:02,719
Speaker 3: And then the woe that replaced Liz sends me a

1094
00:53:02,760 --> 00:53:05,120
Speaker 3: text on LinkedIn and says, hey, stupid, I've got an

1095
00:53:05,160 --> 00:53:08,680
Speaker 3: article out too, back to back in Foreign Affairs, two

1096
00:53:08,760 --> 00:53:13,400
Speaker 3: must reads on China. I mean, folks, get a subscription

1097
00:53:13,920 --> 00:53:17,000
Speaker 3: to Foreign Affairs. Throw it at your brady twenty two

1098
00:53:17,080 --> 00:53:20,200
Speaker 3: year old and say shut up and read it. Bonus, Lisa,

1099
00:53:20,280 --> 00:53:22,759
Speaker 3: It's in a bigger font for you and me who

1100
00:53:22,800 --> 00:53:23,920
Speaker 3: can actually read it.

1101
00:53:24,800 --> 00:53:25,320
Speaker 6: Excellent.

1102
00:53:25,560 --> 00:53:28,040
Speaker 2: Can you come back sometime soon, like.

1103
00:53:28,080 --> 00:53:30,600
Speaker 13: You know, anytime. I'm just up the road, Shanna.

1104
00:53:30,760 --> 00:53:33,120
Speaker 3: Thank you so much doctorning a off of Park Avenue

1105
00:53:33,120 --> 00:53:36,240
Speaker 3: with Consol and Foreign Relations. I can't say enough about

1106
00:53:36,239 --> 00:53:41,200
Speaker 3: her commitment to Latin America and making us wiser and brighter.

1107
00:53:40,840 --> 00:53:42,840
Speaker 2: Over the recent years.

1108
00:53:42,960 --> 00:53:47,160
Speaker 3: Stay with us more from Bloomberg Surveillance coming up after this.

1109
00:53:54,360 --> 00:53:57,959
Speaker 1: You're listening to the Bloomberg Surveillance podcast. Catch us Live

1110
00:53:58,040 --> 00:54:01,520
Speaker 1: weekday afternoons from seven to ten an listen on Apple

1111
00:54:01,600 --> 00:54:04,920
Speaker 1: Karplay and Android Otto with the Bloomberg Business up, or

1112
00:54:05,080 --> 00:54:06,600
Speaker 1: watch us live on YouTube.

1113
00:54:06,760 --> 00:54:11,600
Speaker 3: We welcome back, seriously, Lisa, the lightness of newspapers.

1114
00:54:11,600 --> 00:54:12,040
Speaker 2: What do you have?

1115
00:54:12,280 --> 00:54:14,560
Speaker 4: Okay, we do? I want to talk more.

1116
00:54:14,600 --> 00:54:16,600
Speaker 14: It kind of flows into what we've been talking about

1117
00:54:16,600 --> 00:54:20,080
Speaker 14: about Madodo, about the breaking news that happen and all

1118
00:54:20,160 --> 00:54:23,280
Speaker 14: of the deep fakes that came out when the news broke,

1119
00:54:23,680 --> 00:54:27,320
Speaker 14: and it kind of yes, AI and all the fake

1120
00:54:27,400 --> 00:54:31,120
Speaker 14: fake pictures everything that came out because a lot of

1121
00:54:31,160 --> 00:54:33,839
Speaker 14: AI generators they have rules against, you know, doing things

1122
00:54:33,920 --> 00:54:37,200
Speaker 14: like this, for people creating images like this, but the

1123
00:54:37,280 --> 00:54:39,719
Speaker 14: problem is that you can't control it some of the time.

1124
00:54:39,800 --> 00:54:43,160
Speaker 3: So that we are tearing the fancy billionaires for the

1125
00:54:42,840 --> 00:54:43,480
Speaker 3: foot yacht.

1126
00:54:44,080 --> 00:54:46,040
Speaker 2: It's small, right, one hundred.

1127
00:54:45,719 --> 00:54:49,080
Speaker 4: Foot they control it and they can't.

1128
00:54:49,120 --> 00:54:52,480
Speaker 14: They can't because it's sometimes there's there's these workarounds for it.

1129
00:54:52,640 --> 00:54:54,719
Speaker 14: So what the New York Times did did is that

1130
00:54:55,040 --> 00:54:58,319
Speaker 14: they actually went on so they went onto like open AI.

1131
00:54:58,400 --> 00:54:59,560
Speaker 4: They went on to Gemini.

1132
00:54:59,800 --> 00:55:02,960
Speaker 14: They went onto the X platforms to see if they

1133
00:55:03,000 --> 00:55:05,880
Speaker 14: could generate an image of my Doudo, and it turns

1134
00:55:05,880 --> 00:55:09,160
Speaker 14: out they did so, so it can be done. But

1135
00:55:09,200 --> 00:55:12,279
Speaker 14: it's this whole question of you know, these companies are saying, well,

1136
00:55:12,320 --> 00:55:14,839
Speaker 14: you know, it can't be done, but it's happening. And

1137
00:55:14,880 --> 00:55:17,600
Speaker 14: so this is the whole question behind this article is

1138
00:55:17,640 --> 00:55:18,320
Speaker 14: what to believe?

1139
00:55:18,920 --> 00:55:20,080
Speaker 2: What's not unbelievable?

1140
00:55:20,120 --> 00:55:24,359
Speaker 3: Like I'm looking at Duke winning a college football ball game.

1141
00:55:24,719 --> 00:55:28,080
Speaker 4: I thought it was a hey, fake news exactly, it

1142
00:55:28,160 --> 00:55:28,560
Speaker 4: was real.

1143
00:55:28,960 --> 00:55:30,480
Speaker 5: So but yes, it's tough to and this is the

1144
00:55:30,480 --> 00:55:32,640
Speaker 5: first time we've seen with real time bigness.

1145
00:55:32,920 --> 00:55:34,080
Speaker 4: Yeah, real time big news.

1146
00:55:34,120 --> 00:55:35,960
Speaker 14: I mean there's been other stories too about you know,

1147
00:55:36,160 --> 00:55:39,080
Speaker 14: fake crowds, you know in Venezuela, Like you see these

1148
00:55:39,120 --> 00:55:41,600
Speaker 14: pictures on let's say your Instagram, theed or or wherever,

1149
00:55:42,120 --> 00:55:43,000
Speaker 14: and a lot.

1150
00:55:42,840 --> 00:55:44,120
Speaker 4: Of this is not real.

1151
00:55:44,280 --> 00:55:46,879
Speaker 14: So it's hard to determine what to believe when you're

1152
00:55:46,880 --> 00:55:47,399
Speaker 14: working news.

1153
00:55:47,520 --> 00:55:48,680
Speaker 2: Let's have to say about the show.

1154
00:55:50,440 --> 00:55:52,320
Speaker 14: Okay, Paul, I have a question for you to the

1155
00:55:52,400 --> 00:55:58,040
Speaker 14: next story. Is golf exercise? It's exercise, yes, because I walk?

1156
00:55:58,320 --> 00:55:58,919
Speaker 2: You do walk?

1157
00:55:59,000 --> 00:56:01,040
Speaker 4: Yes, you know I'm going to call. No, we have caddies.

1158
00:56:01,040 --> 00:56:02,799
Speaker 4: We have the jocks. So you don't hop in the

1159
00:56:02,800 --> 00:56:03,799
Speaker 4: golf cart and go right.

1160
00:56:03,760 --> 00:56:05,600
Speaker 5: Now, I walk unless there are no caddies. But we

1161
00:56:05,640 --> 00:56:06,640
Speaker 5: have a great caddy program.

1162
00:56:06,640 --> 00:56:07,520
Speaker 2: Show play slow.

1163
00:56:08,280 --> 00:56:11,319
Speaker 4: I played as quickly as possible. I'm ready golf. So

1164
00:56:11,360 --> 00:56:13,480
Speaker 4: you get your ball, take a look and swack it.

1165
00:56:13,760 --> 00:56:16,359
Speaker 14: Okay, So okay, it's exercise in your case.

1166
00:56:16,480 --> 00:56:16,920
Speaker 9: I got it.

1167
00:56:17,040 --> 00:56:19,719
Speaker 14: But there's a lot of people, well they especially the

1168
00:56:19,719 --> 00:56:22,439
Speaker 14: head of like Equinox, this book the Wall Street Journal,

1169
00:56:22,520 --> 00:56:24,799
Speaker 14: who says, you know what, it's really not because you're

1170
00:56:24,800 --> 00:56:26,439
Speaker 14: hopping in a golf cart. You're having like a beer

1171
00:56:26,600 --> 00:56:27,000
Speaker 14: like the ninth.

1172
00:56:27,160 --> 00:56:32,960
Speaker 4: True, that's true. Get you're drinking ie, we do some Yeah.

1173
00:56:33,000 --> 00:56:38,160
Speaker 5: Swing oil is involved oil yep. Oh swing a little

1174
00:56:38,239 --> 00:56:41,080
Speaker 5: transfusion going there, yep, that's how you roll.

1175
00:56:41,800 --> 00:56:42,880
Speaker 9: Well, they talked about this.

1176
00:56:43,080 --> 00:56:46,160
Speaker 14: He's basically saying, you know what, golf is not real exercise.

1177
00:56:46,280 --> 00:56:49,440
Speaker 14: But he talked about the whole longevity market and how

1178
00:56:49,520 --> 00:56:53,120
Speaker 14: big it's becoming for especially they're their top clients, how

1179
00:56:53,160 --> 00:56:55,560
Speaker 14: they're paying like tens of thousands of dollars for these

1180
00:56:55,560 --> 00:56:56,000
Speaker 14: top things.

1181
00:56:56,040 --> 00:57:00,360
Speaker 3: Twenty second audible. Here do you believe Lisa, that's society

1182
00:57:00,680 --> 00:57:04,880
Speaker 3: has actually dramatically decreased it's consumption and alcohol.

1183
00:57:05,239 --> 00:57:06,360
Speaker 4: Oh, actually everywhere.

1184
00:57:06,440 --> 00:57:08,239
Speaker 14: No, most definitely, because even when I hang out with

1185
00:57:08,239 --> 00:57:10,960
Speaker 14: a group of friends, you notice how some people order

1186
00:57:11,000 --> 00:57:15,200
Speaker 14: the the mocktails because they think I'm not drinking anymore.

1187
00:57:15,560 --> 00:57:18,080
Speaker 14: It's dry January, you know, like some people do that.

1188
00:57:18,200 --> 00:57:20,000
Speaker 4: How many took a gummy before that?

1189
00:57:20,000 --> 00:57:20,600
Speaker 2: So what is it?

1190
00:57:21,440 --> 00:57:23,760
Speaker 4: That's the web February February.

1191
00:57:23,880 --> 00:57:25,360
Speaker 9: Yeah, come back February.

1192
00:57:25,400 --> 00:57:30,320
Speaker 2: You know, Jenny Kreamhills are a mock too. Yeah. Next, okay, okay.

1193
00:57:30,200 --> 00:57:32,480
Speaker 14: This is the quick one, a five and thirty five

1194
00:57:32,480 --> 00:57:35,200
Speaker 14: pound bluefin tuna smash reference.

1195
00:57:35,280 --> 00:57:35,600
Speaker 4: Okay.

1196
00:57:35,680 --> 00:57:38,560
Speaker 14: It's sold for more than two million dollars. It's Tokyo's

1197
00:57:38,600 --> 00:57:41,680
Speaker 14: first fish auction of the year. It was bought by

1198
00:57:41,720 --> 00:57:46,400
Speaker 14: this company, Kio Moricorp. They operate Sushi San my restaurant chains.

1199
00:57:46,440 --> 00:57:48,600
Speaker 14: But the head of the company, he's like known as

1200
00:57:48,640 --> 00:57:52,200
Speaker 14: the tuna King. Okay, and he says, the first fish

1201
00:57:52,360 --> 00:57:53,160
Speaker 14: brings good luck.

1202
00:57:54,320 --> 00:57:57,080
Speaker 4: There's a picture here in the Telegraph. This is monster

1203
00:57:57,200 --> 00:57:57,840
Speaker 4: tuna fish.

1204
00:57:58,040 --> 00:57:58,560
Speaker 12: It is a.

1205
00:57:58,600 --> 00:58:01,640
Speaker 14: Monster tuna fish. And within hours it was already being

1206
00:58:01,680 --> 00:58:04,720
Speaker 14: sliced up and serve. Sure out at the restaurant. But

1207
00:58:05,000 --> 00:58:11,640
Speaker 14: I'm a big sushi fan. Yes, I'm pretty basic. I

1208
00:58:11,640 --> 00:58:14,080
Speaker 14: don't go you know, the eel and all that.

1209
00:58:16,400 --> 00:58:18,880
Speaker 2: Yeah, do you have like three times a day you

1210
00:58:18,920 --> 00:58:19,480
Speaker 2: have sushi?

1211
00:58:19,560 --> 00:58:22,920
Speaker 4: Like it could rot to the tune out Yeah, protein, yes,

1212
00:58:23,680 --> 00:58:24,400
Speaker 4: the newspapers.

1213
00:58:24,440 --> 00:58:25,919
Speaker 2: Lisa Manteo, Thank you so much.

1214
00:58:26,280 --> 00:58:31,120
Speaker 1: This is the Bloomberg Surveillance podcast, available on Apple, Spotify,

1215
00:58:31,240 --> 00:58:35,520
Speaker 1: and anywhere else you get your podcasts. Listen live each weekday,

1216
00:58:35,640 --> 00:58:39,160
Speaker 1: seven to ten am Eastern on Bloomberg dot com, the

1217
00:58:39,200 --> 00:58:43,240
Speaker 1: iHeartRadio app, tune In, and the Bloomberg Business app. You

1218
00:58:43,280 --> 00:58:46,640
Speaker 1: can also watch us live every weekday on YouTube and

1219
00:58:46,840 --> 00:58:48,560
Speaker 1: always on the Bloomberg terminal