WEBVTT - Jobs, Quantitative Tightening, And EVs (Podcast) 0:00:00.800 --> 0:00:04.040 Welcome to the Bloomberg Markets Podcast. I'm Paul Sweeney, alongside 0:00:04.040 --> 0:00:06.920 my co host Matt Miller. Every business day, we bring 0:00:06.960 --> 0:00:11.520 you interviews from CEOs, market pros, and Bloomberg experts, along 0:00:11.520 --> 0:00:15.600 with essential market moving news. Find the Bloomberg Markets Podcast 0:00:15.600 --> 0:00:18.439 on Apple Podcasts or wherever you listen to podcasts, and 0:00:18.480 --> 0:00:22.480 at Bloomberg dot com slash podcast. All right, let's talk 0:00:22.480 --> 0:00:25.040 about this labor number again. I thought it was pretty good. 0:00:25.040 --> 0:00:27.960 It came in a little bit better and expected unemployment 0:00:28.000 --> 0:00:30.640 rate ticked up, but we had some, you know, higher participation, 0:00:30.720 --> 0:00:32.360 which is something people have been talking about for a 0:00:32.400 --> 0:00:34.920 long time. Let's check in with our good friend Tom Gimble. 0:00:34.960 --> 0:00:38.120 He's a founder and CEO of LaSalle Network. Tom, and 0:00:38.200 --> 0:00:40.800 look pretty solid from my perspective. And I love to 0:00:40.800 --> 0:00:43.240 get your thoughts because you're talking to these companies every 0:00:43.320 --> 0:00:47.600 day about filling open slots. I feel like we're doing 0:00:47.640 --> 0:00:50.880 Groundhog Day every month, guys. I mean, three hundred and 0:00:50.960 --> 0:00:55.160 fifteen thousand jobs and participation rates up. What it shows 0:00:55.240 --> 0:00:57.440 is is that the ADP numbers are crazy. They don't 0:00:57.440 --> 0:01:00.120 know what they're doing. It shows that the economy me 0:01:00.240 --> 0:01:04.480 still strong and like the football season, the college football 0:01:04.520 --> 0:01:08.760 season that you omitted a few minutes ago. Correct, that 0:01:08.959 --> 0:01:12.959 starts tonight. Uh, we're kicking off the fall season, the 0:01:13.040 --> 0:01:15.200 last third of the year, with a great economy and 0:01:15.200 --> 0:01:18.080 a great jobs are board. The TCU horn Frogs are 0:01:18.120 --> 0:01:21.200 coming into Boulder, Colorado tonight to take along the Colorado. 0:01:21.200 --> 0:01:25.880 But I graduated ninety four. Boulder isn't what it was 0:01:26.520 --> 0:01:30.600 really how so? Well, I mean I was saying from football, 0:01:30.640 --> 0:01:34.280 from the economy, Boulders unbelievable and expensive. The football team. 0:01:35.920 --> 0:01:37.720 It never should have left the Big twelve. But that's 0:01:37.720 --> 0:01:42.080 the whole another time three So but um, this isn't 0:01:42.200 --> 0:01:46.360 really helpful in terms of lowering inflation though, tom is it? 0:01:46.520 --> 0:01:49.800 I mean, we did have a ton of job openings, 0:01:50.320 --> 0:01:53.080 but uh, well, we had a ton of job openings, 0:01:53.080 --> 0:01:55.160 were adding a ton of jobs. Average hour, early earnings 0:01:55.160 --> 0:01:58.040 are up more than five Um does that help bring 0:01:58.080 --> 0:02:04.000 down inflation? You know? Uh, it's funny. Uh, you go 0:02:04.080 --> 0:02:06.800 out for dinner and things maybe a little bit more 0:02:06.840 --> 0:02:09.960 expensive here and there. People want to say that we're 0:02:10.000 --> 0:02:13.639 in the mid nineteen seventies again, and we're not. Now 0:02:13.680 --> 0:02:17.160 there's a difference between this economy and every other that 0:02:17.200 --> 0:02:20.280 we've ever been in and and those differences are a 0:02:20.440 --> 0:02:23.480 it's truly a global world. Number two, we have a 0:02:23.560 --> 0:02:26.280 real supply chain shortage that we've never had in this 0:02:26.360 --> 0:02:29.720 country before. And number three, we're still feeling the after 0:02:29.760 --> 0:02:32.600 effects of a global pandemic. And people want to have 0:02:32.800 --> 0:02:37.440 A plus B equals C according to normal historical economics, 0:02:37.520 --> 0:02:40.120 and it's just not that way anymore. Tom When you 0:02:40.160 --> 0:02:42.440 talk to your clients, your companies that are looking to 0:02:42.520 --> 0:02:44.680 fill jobs, kind of give us a sense of what 0:02:44.760 --> 0:02:47.600 their biggest challenges are. Do they do they just have 0:02:47.680 --> 0:02:50.320 to pay more, Do they have to be touchy feely 0:02:50.400 --> 0:02:52.560 and have fun things in your office? What are some 0:02:52.600 --> 0:02:55.520 of the challenges that they really face and filling these openings. 0:02:56.200 --> 0:02:59.080 The number one challenge that every company is facing is 0:02:59.120 --> 0:03:01.320 they want to get their people in the office more 0:03:01.360 --> 0:03:04.320 than what they currently are, and they're afraid of turnover. 0:03:04.360 --> 0:03:07.520 And as long as unemployment as a record lows, even 0:03:07.560 --> 0:03:10.079 with a two tenths of a percent uptick today, as 0:03:10.120 --> 0:03:12.800 long as it's a record lows, they're afraid to do 0:03:12.840 --> 0:03:15.080 what they think is best for the business. And the 0:03:15.200 --> 0:03:18.560 only way that it's gonna turn is when unemployment really 0:03:18.680 --> 0:03:20.280 rises and you see it a four and a half 0:03:20.320 --> 0:03:22.160 five five and a half, which I don't see it 0:03:22.200 --> 0:03:25.440 happening in the near future, but that will eventually happen 0:03:25.480 --> 0:03:28.160 because everything runs in cycles, and then it'll go back 0:03:28.400 --> 0:03:30.639 and and we'll go through a cycle again. That's that's 0:03:30.639 --> 0:03:32.959 how things work. Well. The FED probably wants to see 0:03:32.960 --> 0:03:34.720 that as soon as possible. I know everyone's a macro 0:03:34.800 --> 0:03:38.680 tourist these days. Um, I'm very guilty of that. But 0:03:39.440 --> 0:03:42.400 doesn't this just give the FED ammunition to go seventy 0:03:42.440 --> 0:03:46.240 five and seventy five? It does, and and and I 0:03:46.320 --> 0:03:48.680 got news for you. That's what it should be doing, 0:03:48.720 --> 0:03:50.960 and it should have done it last year. And we 0:03:51.040 --> 0:03:52.920 need that because if we ever get into an air 0:03:53.040 --> 0:03:56.640 quotes real recession, we're gonna need that lever we're not 0:03:56.680 --> 0:03:59.160 in a real people say, oh, they're gonna kill the 0:03:59.560 --> 0:04:02.240 econo of he's doing great. What it shows is is 0:04:02.280 --> 0:04:05.120 the economy is so strong it can run when money 0:04:05.160 --> 0:04:08.120 isn't free. Isn't that the whole point? Yeah, well that's 0:04:08.160 --> 0:04:11.080 a great point actually, And um, that's something I haven't 0:04:11.120 --> 0:04:13.760 heard a lot of people saying lately. But you might 0:04:13.800 --> 0:04:15.800 as well build up a war chest. I know, that's 0:04:15.840 --> 0:04:18.560 not the primary reason to raise rates. But if that's 0:04:18.600 --> 0:04:21.920 a secondary effect, I'll take it. Wait wait wait wait 0:04:21.920 --> 0:04:23.120 wait wait wait wait, what do you mean it's not 0:04:23.279 --> 0:04:26.440 the primary reason we started raising the feed started raising 0:04:26.480 --> 0:04:29.160 interest rates before there was inflation, and everybody said it 0:04:29.200 --> 0:04:32.719 should have happened last year when there wasn't inflation. The 0:04:32.800 --> 0:04:36.440 primary reason to have interest rate inflation already inflation was 0:04:36.480 --> 0:04:40.559 already last year was the transitory debate, right. Last year was, dude. 0:04:40.720 --> 0:04:43.520 Last year was when housing prices started going insane. Last 0:04:43.600 --> 0:04:45.560 year was when you couldn't buy a car. Last year 0:04:45.640 --> 0:04:48.920 was when used cars cost more than new cars in 0:04:49.080 --> 0:04:52.679 supply chain issues, not because of inflation, because you couldn't 0:04:52.680 --> 0:04:55.320 get a car. It was a supply and demand issue, 0:04:55.440 --> 0:04:59.560 not an inflationary issue. Tom. If I go down to Austin, Texas, 0:04:59.600 --> 0:05:03.760 can I get job or in Florida, that's for everybody's flowing. 0:05:04.240 --> 0:05:08.200 Are the regional differences out there? Yeah, there's always regional differences. 0:05:08.200 --> 0:05:10.000 And I've said that on your show a million times. 0:05:10.040 --> 0:05:12.040 Is that the problem is is that we look at 0:05:12.080 --> 0:05:15.599 unemployment for the most part as a United States issue, 0:05:15.640 --> 0:05:19.560 and it's really, uh, it's very regionally driven and and 0:05:19.600 --> 0:05:22.200 the same with wages. Who cares what the wages are 0:05:22.200 --> 0:05:24.240 in New York City versus it's really what they are 0:05:24.240 --> 0:05:27.280 in Tulsa, Oklahoma. Right. I mean, we've got to figure 0:05:27.279 --> 0:05:30.320 out how to how to look at things more regionally 0:05:30.360 --> 0:05:32.080 and that will attract people. But we live in a 0:05:32.120 --> 0:05:35.719 world where people are so entitled. This isn't the seventeen hundred. 0:05:35.880 --> 0:05:38.440 People aren't gonna go out west for a job anymore. 0:05:38.920 --> 0:05:41.520 You are gonna leave Manhattan to go to work in 0:05:41.520 --> 0:05:44.240 Oklahoma when they know that the government's gonna bail him 0:05:44.240 --> 0:05:47.840 out to live in New York. It's right, He's right. 0:05:47.880 --> 0:05:49.960 You know, it's a shame job says only one day 0:05:50.160 --> 0:05:51.880 a month. Because we get have Tom on like you 0:05:51.880 --> 0:05:54.919 know much, we should take our show to him. Where 0:05:55.000 --> 0:05:57.480 is him? I don't know where he is in Chicago? Right? Okaga? Yeah? 0:05:57.480 --> 0:05:58.880 I guess all right, Tom Gimbell, he's a found in 0:05:58.880 --> 0:06:01.000 Cea of La Sound Network. That's right. Uh. And let's 0:06:01.000 --> 0:06:03.640 sell Network the one of the big staffing recruiting companies 0:06:03.680 --> 0:06:06.200 in the country. So Tom knows what he's talking about 0:06:06.200 --> 0:06:08.000 when it comes to how do you fill up these jobs? 0:06:11.880 --> 0:06:14.480 All right, let's get some more color on these jobs numbers. 0:06:14.720 --> 0:06:18.760 John Gollneck, vice president for a Deco, joins us, Hey, John, 0:06:18.800 --> 0:06:21.800 what's your takeaway from these jobs numbers today? Again a 0:06:21.800 --> 0:06:24.400 little bit better than expected, weaker than the prior month, 0:06:24.440 --> 0:06:28.000 but still pretty decent. Yeah, you know, I think, um, 0:06:28.040 --> 0:06:29.640 I think this is a good report. And the term 0:06:29.680 --> 0:06:31.960 said friendly, I think you guys are putting the right 0:06:31.960 --> 0:06:33.919 color on this right now. I think there's two things 0:06:33.920 --> 0:06:37.000 from this report that really stand out to me. Um. One, 0:06:37.400 --> 0:06:40.760 you know, the average hourly earnings month over month, we 0:06:40.760 --> 0:06:43.440 were expecting point four percent and it came in point 0:06:43.600 --> 0:06:47.400 three percent. And I think that wage deceleration. It's still 0:06:47.440 --> 0:06:50.000 growing but not not as not as hyper as it 0:06:50.120 --> 0:06:53.000 was before. Good point. I think that's said friendly. I 0:06:53.000 --> 0:06:55.680 think that's a thread friendly metric right well, in the 0:06:55.720 --> 0:06:58.080 sense that they want to bring inflation down, but um, 0:06:58.120 --> 0:07:00.600 it doesn't give them ammunition to hike. Maybe that's why 0:07:00.640 --> 0:07:02.400 that's a really good point. The other thing I mean, 0:07:02.440 --> 0:07:06.960 I guess is participation rate right right, participation rate is up, 0:07:07.000 --> 0:07:09.320 which drives unemployment rate a little bit. So even though 0:07:09.320 --> 0:07:11.600 that we've seen the unemployment rate at three point seven 0:07:11.720 --> 0:07:14.320 versus the three point five, the participation that we saw 0:07:14.320 --> 0:07:16.760 in the labor market was more than expected. It's not 0:07:16.800 --> 0:07:19.120 a one for one correlation on the math there, but 0:07:19.320 --> 0:07:22.960 there's a driving force. So for me overall, I look 0:07:23.000 --> 0:07:25.040 at the last three months. You know, we've averaged three 0:07:25.480 --> 0:07:28.880 seventy eight thousand jobs. I mean that that was a 0:07:28.920 --> 0:07:31.520 hundred and sixty four. I think the economy is resilient. 0:07:31.680 --> 0:07:33.360 We still have a lot of need out there for 0:07:33.440 --> 0:07:36.640 a lot of employers. Um. You know again, I think, 0:07:36.680 --> 0:07:39.080 like everybody else, I think the Fed is happy with 0:07:39.120 --> 0:07:41.720 this report. I think I'm hopeful that it's not a 0:07:41.760 --> 0:07:43.720 full seventy five and hopeful that it's a fifty. And 0:07:43.760 --> 0:07:45.440 then to your guys point, we wait for the next 0:07:45.440 --> 0:07:48.800 seven day. Have to come out John, because you've just 0:07:49.000 --> 0:07:52.200 answered that what was a big question mark over my head. Um, 0:07:52.720 --> 0:07:55.480 And it's really a reframing of my idea. What the 0:07:55.520 --> 0:07:58.680 Fed wants. Um, they really want at the end of 0:07:58.720 --> 0:08:02.800 the day to bring on a inflation down and they 0:08:02.840 --> 0:08:05.480 probably don't want to have to hike as much as 0:08:05.480 --> 0:08:11.360 they can. So um, a DECO is the biggest uh, 0:08:11.560 --> 0:08:16.320 you know, workforce placement, workforce solutions firm in the world. 0:08:16.360 --> 0:08:19.360 So um, maybe you can answer another conundrum that we've 0:08:19.360 --> 0:08:23.800 been struggling with. Here we're getting layoff announcements left and right, 0:08:23.880 --> 0:08:28.880 and not little ones, right, um, big or of whole 0:08:28.920 --> 0:08:33.880 workforce job cuts. And yet the JOLTS number was eleven 0:08:33.960 --> 0:08:37.280 point eight million job openings. I mean, almost a record 0:08:37.440 --> 0:08:41.280 high amount of job openings. How can you um put 0:08:41.320 --> 0:08:45.000 those two things together? Yeah, you know, I think it's 0:08:45.040 --> 0:08:46.320 there's a lot of things you have to look at 0:08:46.360 --> 0:08:47.880 in our economy, and you have to look at it 0:08:47.920 --> 0:08:50.920 from sector to sector. Right. You know, we saw we 0:08:50.920 --> 0:08:54.480 saw in July that you know, service based, hospitality, leisure. 0:08:54.720 --> 0:08:57.640 It was crazy highs ninety six July and only thirty 0:08:57.679 --> 0:08:59.960 one thousand this month. Wow, what a dip, right, Well, 0:09:00.160 --> 0:09:02.520 not really what a super spike. Right. People people are 0:09:02.520 --> 0:09:04.920 in the summertime season, they're getting some traveling done, They're 0:09:04.920 --> 0:09:07.439 getting some traveling done before the school season starts again. 0:09:07.800 --> 0:09:10.120 It makes sense a little bit more people are are 0:09:10.160 --> 0:09:13.000 are free to travel with you know, pandemic restrictions, um, 0:09:13.000 --> 0:09:14.400 and they want to get back out there. So that 0:09:14.440 --> 0:09:16.920 makes sense. But what we look at, that's that's really 0:09:17.000 --> 0:09:20.559 driving you know, retail. We saw huge retail layoff announcements. 0:09:20.600 --> 0:09:22.800 You know, when we saw Walmart announced plans. We saw 0:09:22.840 --> 0:09:26.480 some other folks, but we're still seeing a massive need. 0:09:26.480 --> 0:09:28.200 I can't go to I can't go to any storefront 0:09:28.200 --> 0:09:30.120 without seeing what we're hiring sign you know, hey, we're 0:09:30.200 --> 0:09:32.800 hiring key holders. We're looking for managers, assistant managers in 0:09:32.840 --> 0:09:36.560 retail um. The demand is huge because I think our 0:09:36.600 --> 0:09:40.160 workforce that used to fill these jobs, right, they were 0:09:40.200 --> 0:09:44.240 impacted in tremendously from COVID. Your servers, your bartenders, your waiters, 0:09:44.240 --> 0:09:47.240 You're people that relied on the tips business, right, the 0:09:47.520 --> 0:09:49.840 foot traffic. They had to find other ways in a 0:09:49.840 --> 0:09:53.760 gig economy. So so now returning back to that nine 0:09:53.800 --> 0:09:56.040 to five, you know, let me be in one place, 0:09:56.120 --> 0:09:58.240 let me let me punch a cock. There's a culture 0:09:58.240 --> 0:10:01.280 shift we're we're adjusting. So I think that's part of it, 0:10:01.360 --> 0:10:04.079 as as we look for more labor participation in that 0:10:04.200 --> 0:10:07.000 you know, sixteen to twenty two year bucket to fill 0:10:07.080 --> 0:10:09.240 some of these roles they're has historically been filled by 0:10:09.240 --> 0:10:11.840 them in the past. But what I'm most excited about, 0:10:11.920 --> 0:10:14.280 to be honest with you about about the job need 0:10:14.320 --> 0:10:17.280 and demand is there's there's a huge need in demand 0:10:17.280 --> 0:10:20.640 and manufacturing and supply chain logistics. When when when COVID 0:10:20.640 --> 0:10:24.400 impacted us and we were dependent on foreign goods man, 0:10:24.480 --> 0:10:26.240 that woke a lot of people up that we needed 0:10:26.200 --> 0:10:29.960 to research our manufacturing base here and and that's where 0:10:30.200 --> 0:10:33.600 we see continued demand fill in second third shifts. How 0:10:33.600 --> 0:10:36.199 do how do we get more participation there? So and 0:10:36.280 --> 0:10:38.600 so we solve that riddle. I think I think we're 0:10:38.640 --> 0:10:41.440 going to see some steam, you know, in this job's 0:10:41.520 --> 0:10:44.880 number for quite some time. That's good stuff, good numbers, 0:10:45.080 --> 0:10:48.840 good analysis. John Galnack, Chief Researcher VP at A DECO 0:10:49.280 --> 0:10:51.600 and a shout out to your former or your future job, 0:10:51.640 --> 0:10:55.079 I should say my future job as a great Oh, 0:10:55.240 --> 0:10:57.360 darn wright at Walmart, greaterer at Walmart. I'm gonna be 0:10:57.360 --> 0:10:59.320 a darn good one, and they've better be ready for 0:10:59.360 --> 0:11:03.240 me coming up in a few years. Bringing on our 0:11:03.240 --> 0:11:05.280 next guest, Kate to Shane, CEO of r g P 0:11:05.520 --> 0:11:09.440 r GPS Resources the Global Professionals. It's the operating arm 0:11:09.559 --> 0:11:12.360 of Resources Connections, which is a publicly traded company. Our 0:11:12.440 --> 0:11:15.960 GPS a ticker you can put into your Bloomberg terminal. 0:11:16.240 --> 0:11:19.520 I've got a six hundred sixty million market company based 0:11:19.520 --> 0:11:24.560 in Irvine, California. The stocks up about uh this year. 0:11:24.679 --> 0:11:28.080 The company provides consulting services a consert wide range of 0:11:28.160 --> 0:11:30.800 business issues. Okay, thanks so much for joining us here. 0:11:31.120 --> 0:11:33.480 You know, we had a pretty good jobs number today. 0:11:33.559 --> 0:11:36.440 I'd love to hear what your companies that you talked 0:11:36.480 --> 0:11:40.200 to and you consult with on the human resources from 0:11:40.240 --> 0:11:43.080 what's their biggest issue? Is it just getting bodies in 0:11:43.160 --> 0:11:46.680 the door, or are they even trying to still figure 0:11:46.679 --> 0:11:48.440 out the hybrid work thing. What are some of the 0:11:48.440 --> 0:11:52.160 big issues that you're hearing from your clients. Yeah, thanks 0:11:52.160 --> 0:11:54.559 for having me. I'm certainly happy to be here. So 0:11:54.600 --> 0:11:58.240 it's a multitude of issues. I think certainly the war 0:11:58.320 --> 0:12:02.520 for talent is still tight um. But as we're seeing 0:12:03.240 --> 0:12:08.360 um jobs increase and labor participation increase a little bit, 0:12:08.400 --> 0:12:12.400 that's good news. But I think going forward, one of 0:12:12.400 --> 0:12:16.199 the biggest issues is how are people working when they 0:12:16.280 --> 0:12:18.839 return to the workforce, And so that means is that 0:12:19.000 --> 0:12:22.320 hybrid um when do you work? How do you work? 0:12:22.360 --> 0:12:26.840 And building more flexibility and agility into workforce planning. Uh, 0:12:26.880 --> 0:12:29.320 those are the kind of discussions that we're really having 0:12:29.360 --> 0:12:33.600 with clients, especially in the face of recessionary worries. You know, 0:12:33.679 --> 0:12:36.920 how do you get work done in more creative ways? 0:12:37.760 --> 0:12:43.320 So you advise primarily financial firms, right, I mean finance accounting, 0:12:43.520 --> 0:12:48.880 and maybe I financing accounting right is our core because management. 0:12:49.200 --> 0:12:53.600 I've been thinking about this UM from the client perspective. Right, 0:12:53.640 --> 0:12:57.360 if I hire a finance firm, I'm gonna pay good 0:12:57.400 --> 0:12:59.719 money for their staff to do what I want when 0:12:59.760 --> 0:13:02.000 I on. I don't want their staff to be working 0:13:02.080 --> 0:13:03.840 from home. I don't want them to be taking off 0:13:03.920 --> 0:13:05.760 labor day weekend. I don't want them to be worried 0:13:05.760 --> 0:13:07.360 about work life balance. I just want them to do 0:13:07.400 --> 0:13:11.440 what I want when I want. So how do you, um, 0:13:11.440 --> 0:13:15.080 how do you square that with companies that are trying 0:13:15.080 --> 0:13:19.160 to like be kinder and gentler to their workforce. Well, 0:13:19.200 --> 0:13:21.120 I think we all have to recognize that the world 0:13:21.160 --> 0:13:25.160 of work is fundamentally changed post pandemic, and talent is 0:13:25.200 --> 0:13:28.520 really in the driver's seat. So I understand the perspective 0:13:28.600 --> 0:13:30.880 that you just shared, but really the world is different, 0:13:30.960 --> 0:13:34.800 and I think that what creative companies and what companies 0:13:35.120 --> 0:13:38.760 that are really thriving understand is that there isn't a 0:13:38.800 --> 0:13:42.079 black and white answer here. That you have to find 0:13:42.760 --> 0:13:46.599 a middle ground. That works both from a business perspective 0:13:46.600 --> 0:13:49.080 and from a talent perspective. And so there's a lot 0:13:49.120 --> 0:13:52.440 of creativity happening. There's a lot of work that's been 0:13:52.440 --> 0:13:56.560 delivered remotely, or we use a term borderless talent, meaning 0:13:56.559 --> 0:14:00.680 that we can better match in today's environment to the 0:14:00.760 --> 0:14:03.640 exact client need if a client is willing to be 0:14:03.720 --> 0:14:07.839 more creative about when, where, how that work gets done. 0:14:08.480 --> 0:14:12.160 Um So we might find the perfect financial professional for 0:14:12.200 --> 0:14:15.439 a client engagement, but that person might sit in Dublin 0:14:16.200 --> 0:14:20.600 UM or in London or in Atlanta. And so if 0:14:20.640 --> 0:14:23.760 a client's thinking can shift to say, I don't need 0:14:23.840 --> 0:14:27.520 them in the cubicle next door, it really opens the 0:14:27.560 --> 0:14:31.720 aperture of the talent availability. How do you think about 0:14:31.800 --> 0:14:34.240 I mean, Kate, I'm a little bit old school. I 0:14:34.280 --> 0:14:35.680 you know, I kind of came up on Wall Street 0:14:35.680 --> 0:14:37.440 where you really did put in the hours and then 0:14:37.480 --> 0:14:39.240 you built up that camaraderie and you built up your 0:14:39.280 --> 0:14:42.880 relationships um and still today at this later stage of 0:14:42.920 --> 0:14:45.680 my career, the relationships are are absolutely the most valuable 0:14:46.120 --> 0:14:48.080 thing I take away from my career. And I think 0:14:48.120 --> 0:14:52.000 a lot of people generally agree with that. But that 0:14:52.280 --> 0:14:56.600 seems like it might get lost here in this new 0:14:56.720 --> 0:15:00.360 hybrid world or work from home world. How do you 0:15:00.400 --> 0:15:03.720 think about that? How do your companies think about that? Well? 0:15:03.760 --> 0:15:08.120 I think that the balance is important, and so you know, 0:15:08.200 --> 0:15:10.240 we go back to the word hybrid, but I think 0:15:10.240 --> 0:15:13.560 it's a little of both. Um. There's certainly benefits to 0:15:13.800 --> 0:15:18.680 be UM found in collaboration learning. So what we're talking 0:15:18.720 --> 0:15:21.880 to clients about is spend those days in the office 0:15:22.520 --> 0:15:26.240 in really meaningful ways. Don't spend them on zoom calls 0:15:26.400 --> 0:15:30.200 or on individually oriented work. When you're in the office, 0:15:30.280 --> 0:15:34.480 be together, have learning moments, have collaboration sessions, and when 0:15:34.480 --> 0:15:36.520 you're not in the office, that's when you do your 0:15:36.560 --> 0:15:38.640 head down work, which we all have a lot of 0:15:38.680 --> 0:15:40.880 that as well. UM, So you need you need to 0:15:40.960 --> 0:15:44.560 learn to work differently, and and that I think will 0:15:44.600 --> 0:15:50.240 be the predominant UM path forward as we continue to 0:15:50.320 --> 0:15:53.800 recover in this economy, not all one way or the other. 0:15:54.080 --> 0:15:55.480 This is something that Paul and I talked about all 0:15:55.480 --> 0:15:58.680 the time because I'm convinced that a lot of that 0:15:58.720 --> 0:16:00.640 can be done in the can act really be done 0:16:00.760 --> 0:16:05.240 in the metaverse or whatever we're calling this world right now. UM, 0:16:05.720 --> 0:16:08.120 I could be wrong about that, but listen, I want 0:16:08.120 --> 0:16:10.640 to ask about your company. You have, at least from 0:16:10.640 --> 0:16:15.440 a stock perspective, trounced um, whatever benchmark index I want 0:16:15.440 --> 0:16:17.720 to put you up against. If I look over also 0:16:17.960 --> 0:16:20.560 any period over the last year, over the last two years, 0:16:20.560 --> 0:16:23.840 over the last five years, you've beaten the UM, SMP 0:16:24.000 --> 0:16:27.240 Small Cap Index, the Russell one thousand, two thousands, three thousand, 0:16:27.280 --> 0:16:31.160 the SMP five dred Um. What are you doing right? 0:16:31.320 --> 0:16:35.240 You think that investors appreciate we're taking care of our people. 0:16:35.520 --> 0:16:38.560 I mean we're really listening. We've we've become really a 0:16:38.640 --> 0:16:41.960 learning and a listening organization, and that's listening both to 0:16:42.160 --> 0:16:46.320 how companies need to get work done, especially around project 0:16:46.400 --> 0:16:50.320 orientation as they face transformation and disruption, and we're listening 0:16:50.320 --> 0:16:52.040 to people and how they want to be treated. I 0:16:52.040 --> 0:16:56.240 mean our core workforce UM Paul and Matt are experienced, 0:16:56.280 --> 0:17:01.560 hire diverse professionals who you know they're in the middle 0:17:01.640 --> 0:17:05.800 probably or later stages of their career, so they already 0:17:05.920 --> 0:17:09.520 know their work, they know their subject matter and their expertise, 0:17:10.040 --> 0:17:15.320 and they want to be appreciated and work with more flexibility, transparency, 0:17:15.440 --> 0:17:18.919 choice and control. And we're really giving the talent market 0:17:18.920 --> 0:17:21.080 what they want today and that's really helped us thrive. 0:17:21.320 --> 0:17:25.960 How about the industry, I mean, do you think more UM. 0:17:26.000 --> 0:17:29.639 You know, financial leaders who are you know, like Paul's age, 0:17:30.200 --> 0:17:32.560 are coming to you for help in this new world. 0:17:34.000 --> 0:17:36.840 They are because what we see. You know, twenty years ago, 0:17:37.040 --> 0:17:41.119 a large enterprise might have one transformation project going on 0:17:41.240 --> 0:17:44.399 at the same time one or two. Fast forward to today, 0:17:44.560 --> 0:17:49.240 transformation is happening everywhere in large organizations. So your transformation 0:17:49.280 --> 0:17:53.359 agenda works something like twenty to twenty five concurrent projects. 0:17:53.960 --> 0:17:57.199 No organization is staffed up for that much change, and 0:17:57.240 --> 0:18:00.320 so you need a trusted partner to say, can you 0:18:00.400 --> 0:18:03.399 bring the expertise in the additional bandwidth I need? And 0:18:03.440 --> 0:18:06.600 that's really where we play. We partner with our clients 0:18:06.600 --> 0:18:10.439 to co deliver on their transformation projects and a lot 0:18:10.520 --> 0:18:17.959 of them are related to UM finance systems, transactions, regulatory change, etcetera. 0:18:18.280 --> 0:18:23.240 So we're a perfect UM adjunct to the initiative business 0:18:23.240 --> 0:18:26.920 initiatives they're trying to accomplish. All right, Kate to Shane, 0:18:26.960 --> 0:18:29.200 thank you so much for joining us. We appreciate getting 0:18:29.200 --> 0:18:32.119 your perspective on the workforce, on the hiring environment, on 0:18:32.160 --> 0:18:35.040 the work environment still a work in progress for a 0:18:35.080 --> 0:18:37.080 lot of companies. Kate to Shane's CEO of r g P. 0:18:37.240 --> 0:18:41.000 I saw some news met over the last week or so, Goldman, Sachs, Morgan, Stanley, 0:18:41.080 --> 0:18:44.440 Jeffreys all talking tough. Yeah about this time, we mean it. 0:18:44.680 --> 0:18:47.639 After Labor Day. We want you guys back in the office. 0:18:47.840 --> 0:18:50.600 But I have to agree with Kate that it's a 0:18:50.680 --> 0:18:52.760 different It's going to be a different work environment that 0:18:53.040 --> 0:18:55.600 was pre pandemical. So yes, they want you to come 0:18:55.680 --> 0:19:01.359 in probably um three four five days a week, but 0:19:01.560 --> 0:19:04.119 not every single week. And they're willing to be more 0:19:04.240 --> 0:19:06.520 flexible than they were before. And they realized they can 0:19:06.560 --> 0:19:08.520 get a lot more done for cheaper than they could before. 0:19:08.720 --> 0:19:10.520 We'll see how that plays out, but certainly that's kind 0:19:10.560 --> 0:19:13.600 of where it appears to be moving. Good jobs day today. 0:19:16.960 --> 0:19:20.040 All right. We know our Federal Reserve is raising rates, 0:19:20.080 --> 0:19:23.280 but they're also engaging in something called quantitative tightening. I'm 0:19:23.320 --> 0:19:25.000 not really sure what that is. I don't really do 0:19:25.119 --> 0:19:27.440 that stuff for a living, but Kevin Mirror does. He's 0:19:27.480 --> 0:19:30.600 a prop trador for Windoor Capital h He's also the 0:19:30.640 --> 0:19:33.520 author of the Macro Tourist newsletter, and he's also a 0:19:33.560 --> 0:19:35.760 Bloomberg opinion contributor. And Kevin, I know you had a 0:19:35.800 --> 0:19:38.919 column out recently we say we shouldn't really fear QT. 0:19:39.160 --> 0:19:43.920 But first, for equity geeks like me, what is quantitative 0:19:44.080 --> 0:19:47.000 tightening and how's the FED doing it? Well? Good morning, 0:19:47.040 --> 0:19:49.879 paul Um. The quantity of tightening is the opposite of 0:19:49.960 --> 0:19:53.400 quantitative easing. Quantitative easing is when the Federal Reserve goes 0:19:53.480 --> 0:19:57.320 out and buys bonds or other assets for its balance sheet, 0:19:57.800 --> 0:20:02.040 basically putting money into this system and taking financial instruments out. 0:20:02.480 --> 0:20:05.080 Quantity of tightening would be the opposite, meaning that it 0:20:05.240 --> 0:20:09.199 shrinks its balance sheet and either by letting those bonds 0:20:09.280 --> 0:20:14.119 run off or extreme cases, actually selling those bonds. So 0:20:15.359 --> 0:20:18.600 should we be concerned that the Fed is talking about 0:20:18.720 --> 0:20:20.639 quantitative tightening and or just kind of what do we 0:20:20.720 --> 0:20:24.400 know about their policies and what do you think about QT? Well, 0:20:24.600 --> 0:20:26.080 first of all, the Fed's doing a lot more than 0:20:26.160 --> 0:20:29.080 talking about quantity of tightening. They've actually scheduled it, and 0:20:29.160 --> 0:20:31.479 they've so far they've agreed that they're going to let 0:20:31.560 --> 0:20:33.920 the balance sheet run off by forty seven and a 0:20:33.960 --> 0:20:36.879 half billion dollars per month, and they're increasing that to 0:20:37.960 --> 0:20:40.840 billion starting in September, and this is what the market 0:20:40.920 --> 0:20:43.320 is a little concerned about because that seems like a 0:20:43.400 --> 0:20:47.040 large number. And if we think about quantitative easing, quantitative 0:20:47.080 --> 0:20:50.080 easing was the process of putting money out into the 0:20:50.119 --> 0:20:52.320 system and trying to make things better, and it actually 0:20:53.040 --> 0:20:57.800 has the kind of the intended consequence of easing financial conditions. 0:20:58.160 --> 0:20:59.920 If we think the quantity of tightening, is you off 0:21:00.040 --> 0:21:03.800 us that we should expect that to tighten financial conditions, 0:21:03.920 --> 0:21:07.560 i e. Sen Stocks down. Unfortunately, there's a there's a 0:21:07.600 --> 0:21:09.840 lot more to this story, and that's kind of what 0:21:10.080 --> 0:21:13.280 the topic of my letter is. That it's not as 0:21:13.359 --> 0:21:17.080 easy as just taking the SMP five and superimposing the 0:21:17.280 --> 0:21:20.119 FEDS balance sheet on it and saying one one's going up, 0:21:20.200 --> 0:21:22.960 the other one's going you know, the smple follow and 0:21:23.040 --> 0:21:25.600 then when the FEDS balance sheet goes lower, that the 0:21:25.720 --> 0:21:29.680