Speaker 1: This is Bloomberg Business Week. I'm Carol Masser and I'm
Speaker 1: Jason Kelly. We're here every day bringing you the latest
Speaker 1: news from the world's of business and finance, plus technology, politics, economics,
Speaker 1: all harnessing the power of Bloomberg Business Week reporters and editors,
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Speaker 1: hundred and twenty countries. You can download Bloomberg Business Week
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Speaker 1: listen to our radio show weekdays at two pm Eastern
Speaker 1: only on Bloomberg Radio. Let's understand where we are medically
Speaker 1: and how that may inform the decision to reopen, and
Speaker 1: how we ultimately do that. Dr Andy Pekosh is back
Speaker 1: with us. He is a professor of molecular microbiology and
Speaker 1: immunology at Johns Hopkins University Bloomberg School of Public Health.
Speaker 1: As you might tell from the name, Bloomberg School of
Speaker 1: Public Health is supported by Mike Bloomberg, the founder of
Speaker 1: Bloomberg LP and Bloomberg Philanthropies. Dr Pekosh, great to have
Speaker 1: you back with us very much. So you guys have
Speaker 1: been doing some remarkable work and really have become the
Speaker 1: gold standard it comes to tracking the virus. The data
Speaker 1: that so many people are relying on help us understand
Speaker 1: where we are, especially in the context of these peaks
Speaker 1: or plateaus that you're hearing the governors talk about, and
Speaker 1: how that may inform both regional and national Uh sort
Speaker 1: of getting back to business, Yeah, well, you know, everything's
Speaker 1: gonna be focused on regions right now. Different regions of
Speaker 1: the countries are in different places in their curves. Um.
Speaker 1: You can hear things from New York about their being
Speaker 1: plateaus going on there. Places like Texas are still in
Speaker 1: their increased stages. So, UM, this is going to be
Speaker 1: really focused on individual regions, county cities, UM, portions of states, UM,
Speaker 1: monitoring how the epidemic is progressing in those particular regions.
Speaker 1: So yes, okay, So how do you anticipate, um dr
Speaker 1: package that that will roll out in real time, especially
Speaker 1: when you know Jason and I keep talking about this
Speaker 1: theme of you know, fear versus greed. There is you
Speaker 1: can feel it, the pressure to get the economy back
Speaker 1: open because we're starting to see some optimism in those numbers,
Speaker 1: and yet those numbers are only getting better because we're
Speaker 1: all staying at home Yeah, So what's going to have
Speaker 1: to come in parallel with UM with the cases going down,
Speaker 1: is going to be a continued increase in our testing,
Speaker 1: and that testing is going to come into forms. It
Speaker 1: will come in continue testing for people who were infected,
Speaker 1: so looking for the virus UH in these people. And
Speaker 1: then the second arm of that testing will be testing
Speaker 1: for antibodies, which will tell us if people actually were
Speaker 1: infected and are still maintaining some level of immunity to
Speaker 1: the virus. So those two tests are really going to
Speaker 1: help inform us in terms of how quickly we can
Speaker 1: start rolling out the rolling back from the public health interventions. Okay,
Speaker 1: so you say that, and I feel like this has
Speaker 1: been the big question from day one, you know, getting
Speaker 1: more and more testing out there, we're still just testing
Speaker 1: small quantities of our society. So help me understand, then,
Speaker 1: when do we get to a level where we are
Speaker 1: testing enough people to safely and securely kind of start
Speaker 1: to go back to normal. Well, you know, as the
Speaker 1: number of cases starts to drop, that will free up
Speaker 1: more tests to go out there and be able to
Speaker 1: test UH, to loosen our parameters for testing. So so
Speaker 1: again as a testing as the number of cases goes down,
Speaker 1: we'll be able to expand testing and that will be
Speaker 1: important because that will help us keep a really good
Speaker 1: track of cases as they rebound. When we start easing
Speaker 1: up on some of the public health interventions, we fully
Speaker 1: expect that as we let people come back into society
Speaker 1: and do their things, we'll see some upticking cases. What
Speaker 1: we have to be is prepared then to identify those
Speaker 1: cases and UM isolating quarantine those individuals instead of having
Speaker 1: the entire society undergo the same kind of public health
Speaker 1: and interventions. Are we going to need an app like
Speaker 1: China has that basically says okay, I was tested, I'm okay,
Speaker 1: Well you know we have the I'll say it's an
Speaker 1: advantage and that we can see other parts of the
Speaker 1: world who are now past their peak and are trying
Speaker 1: to deal with things. And there's lots of different approaches
Speaker 1: there in terms of understanding who's immune, who can go out,
Speaker 1: and who's potentially getting exposed to um to to virus
Speaker 1: in the in that in that plateau phase. So um
Speaker 1: we have a lot of things to try to get
Speaker 1: working here, but we have some examples to use from
Speaker 1: countries in Southeast Asia where they have been able to
Speaker 1: control the virus. I do want to bring back Dr
Speaker 1: Andy Pekosh, Professor of Molecular Microbiology and Immunology at Johns
Speaker 1: Hopkins University Blueberg School of Public Health. Of course, um
Speaker 1: the school is supported by Michael R. Bloomberg. So, Dr Pekosh,
Speaker 1: so what do you think is the most important thing
Speaker 1: that's going on right now in terms of getting the
Speaker 1: virus under control? Well, I think that the public health
Speaker 1: interventions that have been put in place all across the
Speaker 1: country are working. You know, it takes because this virus
Speaker 1: are such a long incubation period, it takes two to
Speaker 1: three weeks before we start seeing the true effect of
Speaker 1: what we've been doing in terms of the numbers of
Speaker 1: cases and the numbers of fatalities. So things are working.
Speaker 1: Now is not the time to take our foot off
Speaker 1: the gas pedal. We need to keep these things going
Speaker 1: and drive this forward until we get past the peak
Speaker 1: in most parts of the country. And so Dr PECash,
Speaker 1: very basic question for you. You know, from the perspective
Speaker 1: of our listeners out there trying to live there everyday lives,
Speaker 1: what do you recommend in terms of masks, What do
Speaker 1: you recommend in terms of like people getting exercise, Can
Speaker 1: they go running with friends, can they take a walk? Like?
Speaker 1: What should people be thinking about? What have we learned
Speaker 1: about this virus that maybe is helping us refine what
Speaker 1: social distancing and what our interaction in public, as limited
Speaker 1: as it is, should be. Yeah, so getting outside, uh,
Speaker 1: walking around, running, exercising outside is fantastic. UM. Keep your
Speaker 1: social distance from people, trying not to run next to
Speaker 1: each other, trying not to um uh get too close
Speaker 1: to people as you're talking. But getting out and exercising
Speaker 1: is a is a wonderful thing to sort of break
Speaker 1: the monotony of being inside all the time. UM, if
Speaker 1: you're going out for your grocery runs or to do
Speaker 1: something else, you know essential. UM, it's great to have
Speaker 1: a mask on UM. The CDC is now updated it's
Speaker 1: guidance and wants everybody to be wearing masks when they
Speaker 1: go out, even just cloth ones. UM. Again, that happened
Speaker 1: because we're realizing how many UM people are having mild
Speaker 1: symptoms full abible to spread the virus. So this is
Speaker 1: really meant to try to capture that small percentage of
Speaker 1: the population that might be spreading the virus and not
Speaker 1: know it. UM. And um again didn't. Now is not
Speaker 1: the time to let up on these things. May be difficult,
Speaker 1: but we have to keep going. So Okay, I do
Speaker 1: wonder how our world has changed. I mean, it's obviously
Speaker 1: changed a lot of different ways, but I mean, is
Speaker 1: it all about getting a vaccine so that we can
Speaker 1: alter itly, really get this under control. Is that the
Speaker 1: final solution to this or is it a case of
Speaker 1: you know, it's going to mutate and we start all
Speaker 1: over again. Well, right now, it doesn't look like this
Speaker 1: virus is going to go away anytime soon. So UM,
Speaker 1: A real important key will be our tool will be
Speaker 1: to get a vaccine, because when we have a vaccine,
Speaker 1: that's when we can go out and really start immunizing
Speaker 1: the vulnerable parts of our population and really make a
Speaker 1: big dent in terms of the disease that's that's being
Speaker 1: caused in the decent diseases with severity in the population. Um,
Speaker 1: We'll have to see how things go over the next
Speaker 1: few months as more and more people become immune to
Speaker 1: the infection, UM, and how the virus will be spreading
Speaker 1: it that at those times, But does that also mean
Speaker 1: the big gatherings, whether it's sports events, UM going back
Speaker 1: to college like things like that, they will just they
Speaker 1: cannot happen for a while, really large gatherings. It's very
Speaker 1: there's very little chance that that can be put back
Speaker 1: in place anytime in the near foreseeable future, because what
Speaker 1: we're seeing from other parts of the country or parts
Speaker 1: of the world is that the virus never really goes
Speaker 1: away like we have with what we see with influenza UM.
Speaker 1: It seems to be hanging around UM at all parts
Speaker 1: of the year, and once once it goes through the population,
Speaker 1: there's still some some people left around who are spreading
Speaker 1: the virus. So UM. Gradual rollbacks of some of the
Speaker 1: public health interventions maybe occurring, but I don't foresee going
Speaker 1: back to seventy person football games in the near future. Yeah,
Speaker 1: it's really amazing, you know, we hear about that and
Speaker 1: hear about what the new normal may ultimately look like.
Speaker 1: Dr Andy Pekars, Thank you so much. Great to catch
Speaker 1: up with you again, always such a great voice to
Speaker 1: bring us the real scoop on what's going on out there,
Speaker 1: especially as we start to wrestle with some really big
Speaker 1: questions related to what it looks like on the other
Speaker 1: side of this. He is Professor of molecular Microbiology and
Speaker 1: Immunology at the Johns Hopkins University Bloomberg School of Public Health.
Speaker 1: As you can tell, it is supported by Mike Bloomberg,
Speaker 1: founder of bloom GELP and Bloomberg Philanthropies. Great resource they
Speaker 1: have all been and uh Dr Pekosh included. You're listening
Speaker 1: to Bloomberg Business Week with Carol Masser and Jason Kelly
Speaker 1: on Bloomberg Radio. I have to say I was just
Speaker 1: following Twitter and my brother just tweeted everyone should buy stamps,
Speaker 1: and it was in response to somebody saying, listen, these
Speaker 1: postal workers are out there on the front line, you know,
Speaker 1: delivering our packages, you know, delivering our mail. Um. But Jason,
Speaker 1: it's a tricky time for them. It absolutely is a
Speaker 1: fantastic story coming up in this edition of Bloomberg Sweet Magazine,
Speaker 1: but you can read it now online and on the
Speaker 1: Bloomberg terminal. Devin Leonard wrote it, Projects and Investigations reporter
Speaker 1: for Bloomberg Business Week. He joins us on the phone
Speaker 1: from New Jersey as just Joel Weber, the editor of
Speaker 1: the magazine. He joins us on the phone from Brooklyn,
Speaker 1: and Joel, I want to start with you, Uh, Devin
Speaker 1: is our go to guyde figuring things out in terms
Speaker 1: of the government. He certainly has been over the last
Speaker 1: couple of years. We've relied heavily on him. What teed
Speaker 1: up this story for you? Well, I mean, Devin has
Speaker 1: actually written a book about the Pystal service. So that
Speaker 1: was like the one where in the middle of all this,
Speaker 1: that was like getting mail and I was just so
Speaker 1: looking forward to getting my mail every day, um, and
Speaker 1: I was like, what's going on with the postal service
Speaker 1: right now? So it's like sometimes it feels like I
Speaker 1: had this like a bat phone and I get that
Speaker 1: call certain people and ask for help. And so Devon
Speaker 1: was obviously top of mind a couple of weeks ago
Speaker 1: when we pulled this up. And you know, I think
Speaker 1: it's just a really compelling story because there are certain, um,
Speaker 1: humans that are really on the front lines right now,
Speaker 1: and the postal services really that and it's uh, you know,
Speaker 1: absolutely essential form of communication still and um, they're also
Speaker 1: not getting the support that you might expect. Devin, How
Speaker 1: how does that What did you learn about that on
Speaker 1: that front? Well, I mean it looks it's the it's
Speaker 1: probably the nation's oldest essential service and you know that
Speaker 1: you know, you get you get your mail through. I
Speaker 1: guess as you were saying, you know, you know, neither rain,
Speaker 1: nor stone, nor nor coronavirus. And you know, even when
Speaker 1: a disaster happens, when when you know, mail delivery stops,
Speaker 1: like nine eleven or Katrina or something like that, once
Speaker 1: you see those letter carriers, you know, going around the street,
Speaker 1: that's and you have a sense of you know, oh
Speaker 1: my god, you know, you know, we're back to normal.
Speaker 1: And you know, this is a really tough situation because
Speaker 1: like you know, doctors, nurses, cops, firefighters, you know these
Speaker 1: you know, the people work for the postal service. There
Speaker 1: they're sent you know, they're providing the central service. But
Speaker 1: they didn't have you know, the mask, the gloves, you know,
Speaker 1: you know, the the hand sanitizer that they needed. But
Speaker 1: they had to go out in the midst of in
Speaker 1: the midst of you know, this crisis, and you know
Speaker 1: a lot of people are getting sick, people were going
Speaker 1: weren't going going to work. But you know, as as
Speaker 1: you say, we're still getting we're still getting our mail.
Speaker 1: It's just kind of amazing. I have to say, just
Speaker 1: like Joel I mean there is something in my home too.
Speaker 1: It's like, oh the mail came, like or or package,
Speaker 1: you know, because it's just kind of it's the world
Speaker 1: we're living in right now. The thing is devon. The U. S.
Speaker 1: Postal Service has been struggling for some time, and you know,
Speaker 1: as you rightfully write about, it's you know here we
Speaker 1: need them more than ever, and yet you know, the
Speaker 1: future continues to be so uncertain for the U. S.
Speaker 1: Postal Service. Well, Cary, you're I mean, you're right. You know,
Speaker 1: they were in trouble before this. They've been in trouble
Speaker 1: for a while pretty much, you know, almost two decades now.
Speaker 1: But right now they're just getting hit really hard like
Speaker 1: so many other governments. I'm gonna be businesses in the
Speaker 1: United States by just a total you know, drop off
Speaker 1: in business. I guess we found out just on on Thursday.
Speaker 1: Megan Brennan, the Postmaster General, told Congress that they expect
Speaker 1: mail volume to drop, you know, in a year to
Speaker 1: year year of a year basis, you know, you know,
Speaker 1: by the summertime. So so you know, they were already
Speaker 1: in a tenuous financial situation. They've told Congress that they
Speaker 1: might run out of money you know, as early as June.
Speaker 1: So you know, you know, what what what what is
Speaker 1: the question? And and uh um, Congress did just just
Speaker 1: allow them to you know, would the approval of President
Speaker 1: Trump allow them to borrow ten billion more dollars? But
Speaker 1: I don't I don't think that's enough. Also, just barring
Speaker 1: more money doesn't you know, it doesn't solve their problem.
Speaker 1: You know, you know, Congress has to do something to
Speaker 1: really change their business models to get them out of this.
Speaker 1: And Devin, what role does the private sector play in
Speaker 1: all this? Because you know, we think about Amazon, we
Speaker 1: think about all that we're relying on in terms of
Speaker 1: delivery here. But take us into to that side of it,
Speaker 1: sort of the private versus public Well, you know the
Speaker 1: ups FedEx, you know, and and now Amazon. Now Amazon,
Speaker 1: Amazon's more recent because I've been doing this for a while.
Speaker 1: They they deliver a lot of packages, but you know,
Speaker 1: in terms of overall mail volume, they don't deliver any
Speaker 1: anywhere near you know, you know, the volume that the
Speaker 1: United Its postal service does. And also the postal service
Speaker 1: has to hit every address from the country six times
Speaker 1: a day, sorry, yeah, six days a week. And also
Speaker 1: you know, sometimes on Sunday. Now, so if you were
Speaker 1: just to do away with the postal service, those those
Speaker 1: private sector companies you know, you know, would serve the
Speaker 1: urban areas and in areas with this a lot of
Speaker 1: volume where they can make money, but they wouldn't do
Speaker 1: everything the postal service does. And so so how does
Speaker 1: this get resolved? I mean because we also see and
Speaker 1: you alluded to this. You know, the President did step in,
Speaker 1: but at the same time he's been very skeptical about
Speaker 1: how all of this works and how the U. S.
Speaker 1: Postal Service uh fits in. What's the next step in
Speaker 1: all this? Well, look, I mean what really needs to
Speaker 1: happen is something you know, this should have happened a
Speaker 1: while ago. You know, Congress needs to you know, you know,
Speaker 1: basically revamp the postal services business models. They have more
Speaker 1: control over over costs, so they can it can raise revenues,
Speaker 1: you know, they have they have no real control over
Speaker 1: over over their pricing. But that's not going to happen
Speaker 1: right now, you know, with you know, you know what,
Speaker 1: it's a crisis, you know, an economic crisis along with
Speaker 1: a health crisis. So I think in the end they're
Speaker 1: going to get bailed out, which is what Trump I
Speaker 1: didn't want to have happened. You know a lot of
Speaker 1: Republicans to but I don't think they really have much choice.
Speaker 1: And also when we're talking about voting by mail in November,
Speaker 1: I mean, they need a lifeline. Even though even though
Speaker 1: they're the ones the postal service itself, we're saying we
Speaker 1: didn't we need a new business level. They're not just
Speaker 1: asking for money. What does the world feel like we
Speaker 1: still need it? I mean in terms of the way
Speaker 1: we communicate. I mean, what's the thinking from you know,
Speaker 1: some of the experts that you talked to, Devin Well,
Speaker 1: I mean you you make a really good point, which
Speaker 1: is which is that you know, when's the last time
Speaker 1: you know, you wrote a letter? You know, the the
Speaker 1: postal service was more important to you know Americans, you know,
Speaker 1: a century ago, you know, two centuries ago, when there was,
Speaker 1: when there was it was the main way that people communicated.
Speaker 1: But but even now, you know, we we needed for
Speaker 1: for a lot of basic things. We you know, we
Speaker 1: need packages. There is still some some you know, some
Speaker 1: hard copy mail mail that we need. You just can't
Speaker 1: get rid of it for the reasons I was saying,
Speaker 1: But we're also we get medicine and you know, and
Speaker 1: things like that, and there's all these people there I
Speaker 1: shouldn't So there's always people. There's a fair amount of
Speaker 1: people in the country. Don't we have internet yet, so
Speaker 1: you know, rural areas so and there is an argument
Speaker 1: in some circles that it should be privatized. That's happened
Speaker 1: in Germany, it's happened in Great Britain, it's happened in Sweden,
Speaker 1: and it works there. But we're just so far from
Speaker 1: We're so far away, you know, from from even sort
Speaker 1: of contemplating that here, that that sort of proposed it
Speaker 1: and say that solution and we needed it tomorrow. This
Speaker 1: is not going to happen. It's just, you know, it's
Speaker 1: amazing tool, like something we just take for granted, right
Speaker 1: and are just assumed. But it's it's the times have
Speaker 1: changed a lot over the last decade, for sure, you know.
Speaker 1: You know. The other thing that I just wanted to
Speaker 1: say that Devon and this you know, warrants everyone reading
Speaker 1: it really is. You know, there's also like this labor
Speaker 1: element on top of it. And I think one of
Speaker 1: the other things that Devon did a great job of
Speaker 1: bringing to light here is like what it's like to
Speaker 1: actually be organizing on behalf of the postal service amid
Speaker 1: all of this um and so just on that note,
Speaker 1: that's like another fascinating element of the story that is
Speaker 1: just you know, some great nuance from Devon. Well, definitely
Speaker 1: check out the story everyone, there's so much details. Also
Speaker 1: check out his book as well on the US Postal Service.
Speaker 1: Our thanks to Devon Leonard, Projects and Investigations reporter at
Speaker 1: Bloomberg Business Week joining us on the phone along with
Speaker 1: Jill Webber Weber, editor of Bloomberg Business Week. You're listening
Speaker 1: to Bloomberg Business Week with Carol Messer and Jason Kelly
Speaker 1: on Bloomberg Radio. All right, Andy Brown is with us.
Speaker 1: He's a little further north than we are, up in
Speaker 1: New Hampshire. He is, of course, editorial director of Bloomberg
Speaker 1: New Economy. He joins this on the phone. Uh So, Andy,
Speaker 1: take a look around at the world and tell us
Speaker 1: what you see, because we are seeing different leaders. We've
Speaker 1: heard from a lot of them today. Uh step into
Speaker 1: the breach here, governors, especially some mayors here and there,
Speaker 1: but take a global view of this. What are we
Speaker 1: learning about leadership? Yeah, so, you know the story that
Speaker 1: we've all been listening to in recent years about leadership
Speaker 1: and power in the twenty one century has been very
Speaker 1: much a binary one East versus West, China, USUS the
Speaker 1: US UH, the incumbent power versus the challenge, and the
Speaker 1: big unknown is will they go to war as they
Speaker 1: struggle over global supremacy? And yeah, I mean the story
Speaker 1: has never been particularly satisfactory because it's never taken into
Speaker 1: account the wishes of smaller yet still pretty powerful regional
Speaker 1: countries and economies like India and Japan and Australia and
Speaker 1: the Middle Stay Iran. But you know, this coronavirus seems
Speaker 1: to have completely blown this narrative out of the water. Um.
Speaker 1: You know, it is now clearer than ever that neither
Speaker 1: the United States nor China have the aptitude right now
Speaker 1: for global leadership, nor frankly, do they seem to have
Speaker 1: much appetite for it. Andy take a step back, though,
Speaker 1: because last week you guys kicked off Bloomberg New Economy
Speaker 1: Conversation series, which was an online gathering folks for more
Speaker 1: than sixty countries. You had some really high profile people talking. Obviously,
Speaker 1: leadership came up in this. UM, I am curious you
Speaker 1: know who who you guys talked to, and and some
Speaker 1: other main topics that kind of came away from that discussion. Yeah,
Speaker 1: this this well, I mean this really I would say this,
Speaker 1: this was the main conclusion to emerge. And we had
Speaker 1: Joe and I who was the architect of this concept
Speaker 1: of soft power. We had at um Michelle Flournoy, who
Speaker 1: was a former Deputy under Secretary of Defense and may
Speaker 1: well have been a Defense secretary ahead Hillary Clinton won
Speaker 1: the last election. And Jason Firman, who was, um, you know,
Speaker 1: President Obama's one of President Obama's chief economic aids. But this,
Speaker 1: this issue of leadership came up again and again and
Speaker 1: how the US and China have performed in this global
Speaker 1: once in a century crisis. And frankly, both China and
Speaker 1: the US came in for a battering, you know, I
Speaker 1: mean so on the Chinese side, Yeah, sure, the economists,
Speaker 1: the economy is is substantially up and running, and China
Speaker 1: is now in a position to provide aid to some
Speaker 1: parts of the world, even though they're scoring all kinds
Speaker 1: of propaganda points out of it. But you know, the
Speaker 1: world will never forget that. The Corona outbreak began in Wuhan,
Speaker 1: and you know, Wuhan was saturated with this virus, and
Speaker 1: this virus was being carried to the rest of China
Speaker 1: and the and and the and the whole world, while
Speaker 1: local officials there were engaged in a cover up, you know.
Speaker 1: And and by the same token, you know, the point
Speaker 1: was made that neither will the world forget the images
Speaker 1: that we're seeing right now in real time coming out
Speaker 1: of the United States. You know, the demonstrating the frailties
Speaker 1: and the fragilities of multiple systems in the US, I
Speaker 1: mean the healthcare system, you know, doctors and emergency rooms
Speaker 1: wearing ski goggles and nurses wrapping themselves up in garbage bags,
Speaker 1: and you know, the failures of the of governance with
Speaker 1: with the fumbled response from federal patchwork response in states.
Speaker 1: You talk about states, you know where red states and
Speaker 1: blue states apparently going in different directions, and one part
Speaker 1: of America lockdown, Florida is still partying out on the
Speaker 1: beaches and so on. And then the social systems, you know,
Speaker 1: the the long food food lines. Now you ah, and
Speaker 1: this is this is this is really shocking too. People
Speaker 1: all around the world who are looking at the most
Speaker 1: part of the richest and most powerful country in the
Speaker 1: history of the world. One thing in in the column
Speaker 1: that you wrote to Andy that really jumped out for me,
Speaker 1: and this was from uh something Jason Furman said, who
Speaker 1: said no, He said, no economy will be safe until
Speaker 1: the entire world has this pandemic under control. I mean,
Speaker 1: this whole idea of you know, we just heard from
Speaker 1: six governors in the New York metro area because they
Speaker 1: are talking about in order to reopen the economy, you
Speaker 1: have to have a coordinated event, you know, and response.
Speaker 1: You can't just you know, everybody come up with their
Speaker 1: own plan, and we really need that on a global scale,
Speaker 1: and we're lacking in that. That's exactly right, Carol, is
Speaker 1: that that's the point that that you know, not just Jason,
Speaker 1: but they were all making that this is a common
Speaker 1: challenge and requires a collaborative approach. And what's truly depressing
Speaker 1: about this is that it is by it is not
Speaker 1: at all the only global challenge, common challenge we face.
Speaker 1: Um And you know, if this is if this is
Speaker 1: the botched, failed response that we've seen to coronavirus, what
Speaker 1: about what about an even bigger crisis, which is which
Speaker 1: is climate Yeah, what hope is they have a global
Speaker 1: collaboration on that. It's so interesting you bring that up,
Speaker 1: because I do wonder about things like climate and cooperation
Speaker 1: going forward. You know, we have a promo running about
Speaker 1: Bloomberg Green and saying, you know, this is the biggest
Speaker 1: crisis of our time. It's like it is one of
Speaker 1: the biggest crisis crisis of our time at this point,
Speaker 1: so only about forties seconds left here, Andy, what does
Speaker 1: this pretend for US China relationship? Just to take us
Speaker 1: all the way back to the beginning, Where where does
Speaker 1: us trying to go from here? So you US China,
Speaker 1: I'm afraid it it just digs these two countries deeper
Speaker 1: into a hole. I mean it almost is another almost
Speaker 1: literally another nail in the coffin um. You know. And
Speaker 1: then the one of the one of the conclusions from
Speaker 1: inaugural conversation was, you know, what is what is future power?
Speaker 1: Looked like? I mean, uh, and it's likely to be
Speaker 1: there's a vacuum, you know, anarchy law of the jungle
Speaker 1: UM at best, a regional response to what ought to
Speaker 1: be to to what ought to be a joined up,
Speaker 1: coordinated um, you know, global effort against common problems all right,
Speaker 1: Andy Brown, thank you so much, Editorial director of New Economy,
Speaker 1: joining us on the phone from New Hampshire. I hope
Speaker 1: you continue to stay safe the jolonel now, but you
Speaker 1: let me drive. Oh no, no, no no, no, honey, please,
Speaker 1: I'll do the right reveal. I want to try all
Speaker 1: Just drive, baby, it's the question trying. This is the
Speaker 1: drive to the globe. Thanks. We'll drying us. Dawn Bloomberg Radio,
Speaker 1: it is time for the drive to the clothes. Randy
Speaker 1: Watts is back with us. Great timing to to have
Speaker 1: him here. He's executive vice president and chief investment strategist
Speaker 1: at William O'Neil and company. Today we find him on
Speaker 1: the phone from Miami. Um, Randy, nice to have you
Speaker 1: back here with us. You're doing okay. Your family is
Speaker 1: doing okay, they are. I appreciate you asking, and I
Speaker 1: hope everyone is uh safe and healthy there in New York. Yeah. Yeah,
Speaker 1: we're certainly, uh, we're getting there and certainly dealing with
Speaker 1: our doesn't look like Miami outside my window that I'll
Speaker 1: tell you that much, Rammy. It is the opposite, h
Speaker 1: at this point. And I understand the weather has been
Speaker 1: quite bad up there. Yeah, it's pretty miserable today. I
Speaker 1: was thinking, I was looking back over my notes, and
Speaker 1: I think you were with us late February, UM, and
Speaker 1: it was a day where we were all of course,
Speaker 1: we're about the virus. We weren't. We were back in
Speaker 1: our studio, but we weren't at home. UM. The market
Speaker 1: was selling off because of concerns about the virus. That
Speaker 1: was our theme for the day. How do you see
Speaker 1: the markets right now? We saw a tremendous amount of selling. UM.
Speaker 1: Randy went into technically a bear market. We've bounced back
Speaker 1: a lot. How do you see it when you look
Speaker 1: at all of your charts and you do some analysis. Well,
Speaker 1: a couple of things. Obviously, this has been a very
Speaker 1: very strong rally. We're up about seven percent off the
Speaker 1: lows in three weeks. We would expect either some consolidation
Speaker 1: here or even a move backwards. This is a much
Speaker 1: stronger rally than a typical sort of up nine to
Speaker 1: ten percent bear market rally. I think one thing to
Speaker 1: keep in mind, though, is we're only in the ninth
Speaker 1: week of this bear market, and usually bear markets last
Speaker 1: more than thirty weeks. In addition, at the low, the
Speaker 1: market was down about thirty on the SMP, A normal
Speaker 1: bear market takes it takes it down to about four down.
Speaker 1: If you look at where we sit to today this afternoon,
Speaker 1: the Dow is down about year to date, the SMPS
Speaker 1: down fifteen, and nastcts down about ten. So I am
Speaker 1: a little nervous about two things. First, the time element
Speaker 1: of what's going on. We're not that deep into it
Speaker 1: in terms of weeks. And second, we're going into earning season,
Speaker 1: and I think earning season is gonna be a lot
Speaker 1: worse than the street expects. Well, let's talk about that.
Speaker 1: Let's go at level down there, because I feel like
Speaker 1: we're all bracing ourselves for for earning season. But what
Speaker 1: does bad look like in your estimation, either in terms
Speaker 1: of percentages or in terms of maybe even the lack
Speaker 1: of visibility, because that's one of the things that we've
Speaker 1: heard so consistently, uh from c e O S as
Speaker 1: they've given even you know, ad hoc updates, is they
Speaker 1: just don't know where this is going to go next.
Speaker 1: I mean that's true, Jason, they don't know. In about
Speaker 1: of the SMP five hundred now suspended guidance for the year.
Speaker 1: If you look at where earnings estimates are for the
Speaker 1: SMP five hundred. At the start of the year, people
Speaker 1: were expecting the SMP to earn about a hundred and
Speaker 1: seventy five dollars this year. That numbers down to one seven.
Speaker 1: But if you look at it on a year to
Speaker 1: year basis, last year earnings were about one sixty two.
Speaker 1: So consensus estimates right now are only looking for about
Speaker 1: a ten drop in earnings, and I suspect it's likely
Speaker 1: going to be worse than that, you know, I want
Speaker 1: to go back to what you said, though, we're only
Speaker 1: in the ninth week of this bear market. Usually last
Speaker 1: you know, a usual, typical normal bear market lasts around
Speaker 1: thirty weeks. Is this normal, though, Randy like, there's a logic,
Speaker 1: logical side of my brain that says, I get what's
Speaker 1: going on. We shut down the economy. Of course it's
Speaker 1: going to be really, really bad. But I do wonder
Speaker 1: and this is just not I shouldn't just say just
Speaker 1: but it's really a timing element that when we reopened
Speaker 1: people get back to work, they will resume spending that
Speaker 1: we could see a pretty dramatic bounce back. I think
Speaker 1: the key on that is really unemployment. So you know,
Speaker 1: we entered this scenario with about three and a half
Speaker 1: percent unemployment. We've done about sixteen million job was claimed
Speaker 1: in the last three weeks, which means unemployment today, the
Speaker 1: real unemployment number is probably in the thirteen and fourteen
Speaker 1: percent range. To put that in perspective, unemployment in the
Speaker 1: two thousand and nine recession peaked at ten percent. Recession
Speaker 1: peaked at ten point eight. So unemployment is already a
Speaker 1: lot higher than it was in the last couple of recessions.
Speaker 1: And I think the question for the economy is how
Speaker 1: quickly are those people are going to get hired back
Speaker 1: if we start opening the economy. I don't think that
Speaker 1: means that all those restaurant, hospitality workers, etcetera instantly all
Speaker 1: get hired back, And so that question of job absorption
Speaker 1: is really what makes me nervous. Okay, yeah, I mean
Speaker 1: that's that's such the big question, right is it reopens.
Speaker 1: To Carroll's point, you reopens and people get back out there.
Speaker 1: But if a restaurant, I mean this is just very parochial,
Speaker 1: but like if a restaurant can only see half the
Speaker 1: people that it used to because of social distance things,
Speaker 1: how many people does it need you know, does it
Speaker 1: and and how many? What's the revenue breakdown and the
Speaker 1: profit breakdown? And does the fact that there are you know,
Speaker 1: fewer people working ultimately mean that there are a fewer
Speaker 1: people spending money? Yes? In general, I just have such
Speaker 1: a hard time, in part because nobody knows. And it
Speaker 1: just goes back to this, nobody knows that, and yet
Speaker 1: you have to make investment decisions Randing exactly. And I
Speaker 1: don't want to be too bear ash here. Um. I
Speaker 1: do think we're going to get through this. I do
Speaker 1: think the economy is going to recover. We do expect
Speaker 1: to be a better year for both the economy and
Speaker 1: for corporate earnings. But I think the point I'm really
Speaker 1: trying to make is one, the market has had an
Speaker 1: awfully big move in a short period of time from
Speaker 1: it's low. I'd like to see the market digest that
Speaker 1: a little bit. And second, I just think this going
Speaker 1: into earning season right here today, there's a lot of uncertainty.
Speaker 1: I'd prefer to see us start to get into somebody's
Speaker 1: company reports, see what companies are telling you about profitability
Speaker 1: before really getting aggressive and adding capital. Light here, So,
Speaker 1: what do you do for an investor, you're saying, what
Speaker 1: just I mean just kind of I think we're I
Speaker 1: think we're looking for two things. First, I'd like to
Speaker 1: point outlet in this bounce, a lot of the stocks
Speaker 1: that bounced were not what we would call leadership companies.
Speaker 1: There are a lot of companies that have been very
Speaker 1: beaten down the last month or so, and those were
Speaker 1: the ones rising. The action today is actually more positive
Speaker 1: in a way, and that a lot of the more
Speaker 1: high quality companies are having good days, you know, names
Speaker 1: like Amazon. I think what we're looking for here is
Speaker 1: to see leadership stocks and companies start to do better
Speaker 1: a relative to the market, and to start to add
Speaker 1: some of those names into your portfolio that you know,
Speaker 1: we're gonna not only some somebodys are even gonna benefit
Speaker 1: from what's going on, you know, whether it's an Amazon, a, Microsoft, etcetera,
Speaker 1: or end companies that we think can be long term holdings.
Speaker 1: We really don't want to chase some of these beaten
Speaker 1: down names and hoping they're going to bounce even more
Speaker 1: than they have already. All Right, it's still smart, Brandy Watts, Great,
Speaker 1: all right. Randy Watts, Executive vice President, Chief Investment strategies
Speaker 1: for William o'neili company. Johnny is on the phone from
Speaker 1: sunny Miami. Good for him, happy to hear his voice,
Speaker 1: and it is safe and well and some good insights.
Speaker 1: Has always taken a ton of notes and a ton
Speaker 1: of notes about his market insight. Thanks for listening to
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