WEBVTT - Bloomberg Markets Special Simulcast Day Four 0:00:01.800 --> 0:00:04.400 This is Bloomberg Business Week. I'm Carol Masser and I'm 0:00:04.440 --> 0:00:07.280 Bloomberg Quick Takes Tim Stanebeck. We're here every day bringing 0:00:07.280 --> 0:00:09.799 you the latest news from the world of business and finance, 0:00:09.840 --> 0:00:13.600 plus technology, politics, economics, all furnessing the power of Business 0:00:13.640 --> 0:00:17.119 Week reporters and editors, not to mention our journalists and 0:00:17.120 --> 0:00:19.600 analyst in more than one and twenty countries. You can 0:00:19.600 --> 0:00:23.200 download Bloomberg Business Week and iTunes, SoundCloud, or Bloomberg dot Com. 0:00:23.360 --> 0:00:25.120 You can also listen to our radio show at two 0:00:25.160 --> 0:00:27.840 pm Eastern Time on Bloomberg Radio or watch us on 0:00:27.880 --> 0:00:38.240 YouTube search Bloomberg Global News. Welcome to our global simulcast 0:00:38.280 --> 0:00:41.960 across Bloomberg TV, Radio and YouTube Romain, Boston, alongside Pretty 0:00:42.000 --> 0:00:43.920 Group To and Tim Stanifek. We're gonna be walking you 0:00:43.960 --> 0:00:46.199 through the markets all day long and taking a look 0:00:46.200 --> 0:00:49.440 back at one as well as a look ahead to two. 0:00:49.680 --> 0:00:51.840 Right now, Tim, we're looking at guess what a record 0:00:51.880 --> 0:00:54.560 high on SMB five, record high on the Dow Jones 0:00:54.560 --> 0:00:57.440 Industrial Average, and the NASDAC one hundred actually came within 0:00:57.480 --> 0:00:59.960 about four points of a record high on its own. 0:01:00.200 --> 0:01:01.560 It seems like a little bit of a theme happening 0:01:01.560 --> 0:01:03.600 in the Santa Claus Reraili. I got a fun little 0:01:03.600 --> 0:01:06.200 technical that I spotted on the Market's live blog courtesy 0:01:06.200 --> 0:01:08.839 of Matt Turner earlier today. The SMP five hundred hasn't 0:01:08.840 --> 0:01:11.880 dip below it's two day moving average yet this year. 0:01:12.240 --> 0:01:15.080 That failure has only happened four other time since one, 0:01:15.160 --> 0:01:17.880 and then after three of those occurrences, the SMP five 0:01:17.920 --> 0:01:21.280 hundred sign annual decline the following year. So good thing 0:01:21.319 --> 0:01:23.440 to keep in mind as we look forward to two 0:01:23.600 --> 0:01:25.520 throughout our show today. Yeah, and which a point, I mean, 0:01:25.520 --> 0:01:27.160 that's a that's a fun fact. But think when was 0:01:27.200 --> 0:01:29.200 the last time we were burned low the two day 0:01:29.200 --> 0:01:34.640 moving average pop quiz? I'm guessing it was March? Yeah, April? Oh, 0:01:34.920 --> 0:01:38.160 look at that. I'm starting to get better at these 0:01:38.160 --> 0:01:39.800 pop quizzes, rom Man, I know, I gotta make the 0:01:39.840 --> 0:01:43.000 questions a little bit harder here. All right, let's we're gonna, 0:01:43.240 --> 0:01:45.240 of course, walk you through this market. We're gonna get 0:01:45.280 --> 0:01:47.880 some great insights here from a big slate of guests 0:01:47.880 --> 0:01:49.400 we have coming up. But we want to jump right 0:01:49.440 --> 0:01:51.080 over to Abigail doo Little right now for a little 0:01:51.120 --> 0:01:52.600 bit more of a breakdown, and what's going on in 0:01:52.640 --> 0:01:54.880 the market, Abigail, Well, those technicals that you all were 0:01:54.880 --> 0:01:57.800 just talking about super interesting, And yes, it would suggest 0:01:58.040 --> 0:02:01.040 that the market is overextended right now, not having gone 0:02:01.040 --> 0:02:03.680 to that long term support. Maybe couldn't be a little 0:02:03.680 --> 0:02:05.640 b difficult. In the yesterday we were talking about apple 0:02:05.840 --> 0:02:09.440 growth is expected to slow dramatically. As for what's really 0:02:09.520 --> 0:02:12.480 happening today, that all time high for the SMP five 0:02:13.080 --> 0:02:15.320 on page for the seventy first record close of the year. 0:02:15.440 --> 0:02:18.560 The NAZAC outperforming on some China tech strength. Maybe we'll 0:02:18.639 --> 0:02:20.320 take a look at that in a moment. And then 0:02:20.360 --> 0:02:23.080 super interesting is the fact that the SMP five hundred 0:02:23.080 --> 0:02:26.840 hotel index it is slightly higher despite having some exposure 0:02:26.880 --> 0:02:29.640 to the cruise operators because of course, earlier today the 0:02:29.680 --> 0:02:33.240 CDC coming out with an advisory saying that folks shouldn't 0:02:33.240 --> 0:02:37.000 go on cruise ships, whether vaccinated or not, and we 0:02:37.040 --> 0:02:40.880 saw a big drop off for the cruise lines. The 0:02:41.120 --> 0:02:45.760 Royal Caribbean Carnival down about half a percent at this point, 0:02:45.800 --> 0:02:48.320 so not a huge huge decline, but if you consider 0:02:48.360 --> 0:02:51.760 the these stocks earlier up three percent down two percent 0:02:51.880 --> 0:02:54.680 at the lows, that's a five to six percent swing 0:02:54.760 --> 0:02:58.760 for stocks and are still down six from the pre 0:02:58.880 --> 0:03:02.119 pandemic high. The revenues, it's just incredible. I was taking 0:03:02.160 --> 0:03:05.040 a look at Carnival this year, It's expected to put 0:03:05.120 --> 0:03:08.840 up not even two billion. In twenty eighteen it was 0:03:09.320 --> 0:03:12.919 nineteen billion. So that's what investors are still worried about. Yeah, Abigail, 0:03:12.960 --> 0:03:15.320 When I think cruise lines, when I think that travel sector, 0:03:15.400 --> 0:03:18.240 I think volatility. I'm curious about the volatility not of 0:03:18.240 --> 0:03:20.400 the stock market, but of the bond market. What do 0:03:20.400 --> 0:03:22.880 you see there? You know, it's very interesting and that's 0:03:22.880 --> 0:03:25.760 a great question from the standpoint that these cruise lines, 0:03:25.800 --> 0:03:28.840 similar to airlines during the pandemic, just to make it through, 0:03:28.960 --> 0:03:32.519 really needed to raise a tremendous amount of capital through debts. 0:03:32.520 --> 0:03:34.920 So that's going to be something to watch, the credit 0:03:35.040 --> 0:03:37.880 for the cruise lines, and to some degree right now 0:03:37.880 --> 0:03:39.880 the airline is given the fact that oh, Macron is 0:03:39.920 --> 0:03:46.120 really causing so many cancelations there for um the number 0:03:46.160 --> 0:03:48.520 of the airlines. I think that Jet Blue today came 0:03:48.520 --> 0:03:53.120 out saying that they're canceling nearly flights between January tent 0:03:53.240 --> 0:03:55.600 and for cruise operators, it's gonna be interesting to see 0:03:55.640 --> 0:03:59.720 whether or not folks, people who are very committed to cruising. 0:03:59.800 --> 0:04:01.400 I not one of them, but I do have friends 0:04:01.440 --> 0:04:03.640 who loved to cruise a couple of times each year. 0:04:03.680 --> 0:04:06.040 Whether they're gonna listen to this advisory and will we 0:04:06.120 --> 0:04:08.200 see a real drop off in revenue? If so, that 0:04:08.240 --> 0:04:10.080 could really show up in that credit. All right, something 0:04:10.080 --> 0:04:11.720 we're gonna keep an eye on all day long. Here 0:04:11.760 --> 0:04:14.360 Abigail Doolittle, we'll get check in with her a little 0:04:14.360 --> 0:04:16.080 bit later here in the day. We want to get 0:04:16.160 --> 0:04:18.640 right to our next guest here, Ross Mayfield Bared Investment 0:04:18.640 --> 0:04:22.080 Strategy analyst, joining the big program right now, and Ross Um, 0:04:22.160 --> 0:04:24.520 you know, there's obviously a lot of distortions this week 0:04:24.560 --> 0:04:26.800 and last week because of the low volume here as 0:04:26.800 --> 0:04:29.280 we head towards the end of the year. But anybody 0:04:29.279 --> 0:04:31.560 who's looking ahead to two and trying to sort of 0:04:31.560 --> 0:04:34.960 divine where the SMP might end up, it's got to 0:04:35.000 --> 0:04:37.640 all be tied to where they think earnings, corporate earnings 0:04:37.640 --> 0:04:39.800 themselves are gonna go. And I'm curious as to whether 0:04:39.880 --> 0:04:42.400 you think that some of the I guess relative outperformance 0:04:42.440 --> 0:04:45.080 that we saw in twenty twenty one with regards to 0:04:45.400 --> 0:04:48.680 margins and earnings and revenue growth, whether that continues into 0:04:48.720 --> 0:04:52.359 next year. Yes, so I think a bit more of 0:04:52.400 --> 0:04:54.839 a mixed bag, right, So, we do expect earnings growth 0:04:54.880 --> 0:04:56.800 to be positive. There's a lot of tail winds. They're 0:04:56.880 --> 0:05:01.200 a really strong consumer, some operational efficiencies that companies put 0:05:01.240 --> 0:05:04.440 on during the pandemic and should continue forward. UM, and 0:05:04.480 --> 0:05:07.119 revenue should still be strong given um, you know, pretty 0:05:07.120 --> 0:05:10.400 strong nominal GDP growth that we expect. However, margins have 0:05:10.400 --> 0:05:12.760 have peaked and you know started to roll over a 0:05:12.800 --> 0:05:16.200 little bit, still at extremely high levels, still near records, 0:05:16.200 --> 0:05:18.560 but have peaked and rolled over. We we all have 0:05:18.600 --> 0:05:21.839 heard the inflation story and know about rising input cost inflation, 0:05:21.960 --> 0:05:26.039 particularly UM the stickiness of of wage inflation, which which 0:05:26.080 --> 0:05:29.800 is really one of the bigger input factors across across industry. UM. 0:05:30.040 --> 0:05:32.479 So I do think, you know, there's gonna be enough 0:05:32.520 --> 0:05:35.880 corporate earnings to to drive the market higher outside of 0:05:35.920 --> 0:05:39.120 something that really brings multiples down. Usually in the early 0:05:39.120 --> 0:05:41.600 part of a rate high cycle, multiples are you know, 0:05:41.680 --> 0:05:45.160 kind of flat historically, So if you're taking high single digit, 0:05:45.240 --> 0:05:48.279 low double digit earnings growth, I think you can probably 0:05:48.760 --> 0:05:51.200 translate that pretty well to equity performance. Or also, we've 0:05:51.200 --> 0:05:52.919 been asking a lot of our guests this week about 0:05:52.920 --> 0:05:55.840 the biggest risks in two A lot of them have 0:05:55.880 --> 0:05:58.159 agreed that it would be a misstep by the Federal Reserve. 0:05:58.680 --> 0:06:02.160 I'm wondering where you fall. Well at the same place 0:06:02.200 --> 0:06:04.120 I always following him, asked this question, and the biggest 0:06:04.200 --> 0:06:06.240 risk is the one we don't see Keman because at 0:06:06.240 --> 0:06:09.479 the beginning of nobody had global pandemic on their on 0:06:09.520 --> 0:06:11.800 their cheek sheets. So you know that's kind of a 0:06:11.839 --> 0:06:14.760 copied answer, but um no, but it was. It was 0:06:14.800 --> 0:06:17.400 poetic ross we like and we checked that one off 0:06:17.400 --> 0:06:21.000 that the pandemic is ongoing right there. There we go. Yeah, 0:06:21.120 --> 0:06:23.800 on the Fed front, though, you know you mentioned at 0:06:23.839 --> 0:06:25.800 that top, we're sitting at all. Tom has on all 0:06:25.839 --> 0:06:30.000 the major indusicries. The market is aware of the Feds, uh, 0:06:30.120 --> 0:06:33.240 you know, tapering timeline getting more aggressive. They're aware or 0:06:33.240 --> 0:06:35.520 they're basically pricing in three rate hikes for next year 0:06:36.000 --> 0:06:38.280 the Fed. I think at this point, you know, if 0:06:38.279 --> 0:06:39.920 you wanted to skew the risk one way, it would 0:06:39.960 --> 0:06:42.200 be dubbish. There's gonna be some new appointees who will 0:06:42.200 --> 0:06:46.000 probably lean dubbish. And if inflation moderates or if omicron 0:06:46.279 --> 0:06:48.120 has an effect on the labor market, I think you 0:06:48.160 --> 0:06:50.880 could actually see the FED skew dubbish given one of 0:06:50.880 --> 0:06:54.440 the two options, um, in which case it wouldn't necessarily 0:06:54.440 --> 0:06:57.000 be you know, a headline risk for the market. Um, 0:06:57.080 --> 0:06:58.400 it would it would probably be a bit more of 0:06:58.400 --> 0:07:01.719 a tail wind. Regardless. Uh, we expect monetary policy to 0:07:01.720 --> 0:07:06.039 be extremely accommodative, even if they hike at on plan Ross. 0:07:06.040 --> 0:07:08.279 We gotta talk about tech here because you can't continue 0:07:08.320 --> 0:07:12.160 that's really strong equity performers into the new year without 0:07:12.200 --> 0:07:14.880 having tech on your side. What is the bull and 0:07:14.880 --> 0:07:19.200 bear case for Big Tech? Sure? I mean the bull 0:07:19.240 --> 0:07:22.840 case is long term secular growth trends. It's you know, 0:07:22.960 --> 0:07:27.640 wide modes, low debt, high cash um. You know, really 0:07:27.720 --> 0:07:30.600 strong margins and the ability to protect those margins. They've 0:07:30.600 --> 0:07:33.440 mostly shown throughout this pandemic. UM. They've also been a 0:07:33.480 --> 0:07:37.040 bit of a covid heade right. So throughout Big Tech 0:07:37.160 --> 0:07:39.920 was the kind of sector or what you know, subsector 0:07:39.960 --> 0:07:42.560 that was leading the market higher. It's popped, you know, 0:07:42.640 --> 0:07:45.320 throughout the various waves over the last year. So so 0:07:45.760 --> 0:07:47.760 it's not super hard to make a strong bull case 0:07:47.800 --> 0:07:50.040 for these companies because they are just such high performing 0:07:50.080 --> 0:07:53.280 operators and have done so well over the last decade. 0:07:53.440 --> 0:07:55.240 As we move into this next year and kind of 0:07:55.240 --> 0:07:58.520 get into the you know, maybe mid cycle uh kind 0:07:58.560 --> 0:08:00.920 of themes high quality is a place that we're looking 0:08:00.960 --> 0:08:02.760 to take refuge, and that's that's a lot of those 0:08:02.760 --> 0:08:06.160 big tech operators. On the flip side, you look at 0:08:06.200 --> 0:08:09.360 interest rates, rising interest rates is kind of um, rising 0:08:09.440 --> 0:08:11.640 long interest rates is kind of a headwind for the 0:08:11.680 --> 0:08:15.920 growthier parts of the market. You know overall, UM, small tech, 0:08:15.960 --> 0:08:18.360 small growth is certainly taking it on the chin this year. Um, 0:08:18.400 --> 0:08:20.120 that would be a headwind for big tech if rates 0:08:20.120 --> 0:08:24.280 were really to become uncapped. And then the antitrust uh, 0:08:24.400 --> 0:08:27.040 you know, sentiment, it's kind of taken a backseat as 0:08:27.120 --> 0:08:30.600 build back better has has become the focus in Washington 0:08:30.680 --> 0:08:32.680 right now and getting that back on track. But I 0:08:32.720 --> 0:08:36.040 do think you know, with more appointees, um, you know, 0:08:36.320 --> 0:08:39.320 personnel's policies, So I think you could continue to see 0:08:39.320 --> 0:08:42.240 that sentiment throughout the year and and maybe even ramp 0:08:42.320 --> 0:08:44.680 up as a midterm election talking point any way to 0:08:44.720 --> 0:08:47.160 diversify away from equities. Anything that you look at. We 0:08:47.200 --> 0:08:50.360 only got about a minute left. That's that's the that's 0:08:50.400 --> 0:08:53.439 the number one question on the board because rising inflation, 0:08:53.520 --> 0:08:56.240 rising rates, you really don't want to be in treasuries, 0:08:56.280 --> 0:08:59.439 safe safe fixed income cash is just losing money. I 0:08:59.679 --> 0:09:02.960 do going out the credit spectrum and fixed income in 0:09:03.000 --> 0:09:06.000 shorting duration something like you know, maybe bank loans or 0:09:06.240 --> 0:09:09.080 or or shorter duration high yield could be a place 0:09:09.120 --> 0:09:12.120 to go. You know, valuation there, as with the equity market, 0:09:12.200 --> 0:09:14.319 is fairly rich. But I do think if you see 0:09:14.320 --> 0:09:16.280 even a slight uptake and rates, it's gonna be one 0:09:16.280 --> 0:09:18.720 of the few places takes solids. Um. You know, we 0:09:18.720 --> 0:09:21.400 don't ever really mind a small uh small allocation to 0:09:21.400 --> 0:09:23.640 alternatives or commodities, but we would keep it, we would 0:09:23.679 --> 0:09:26.080 keep it small. All right, Ross Mayfield, It Bair, thanks 0:09:26.120 --> 0:09:34.120 so much for joining us. This is Bloomberg Market Special 0:09:34.160 --> 0:09:38.400 coverage this week, simulcast across Bloomberg TV, radio and on YouTube. 0:09:38.440 --> 0:09:42.280 Romain Bostick alongside Tim Stanovic and Crety Gupta here helping 0:09:42.280 --> 0:09:45.000 you count down to the clothes here in equity markets 0:09:45.160 --> 0:09:46.440 right now, keep an eye on what's going on in 0:09:46.440 --> 0:09:48.960 the commodity space. Settlement right now of noim ex scrude 0:09:49.000 --> 0:09:51.400 future is gonna come in just below seventy seven bucks 0:09:51.440 --> 0:09:53.480 of barrel. We should we've been talking all day, all week, 0:09:53.559 --> 0:09:55.800 frankly about how light the volume is in the equity markets. 0:09:55.840 --> 0:09:58.319 We should point out that, uh in the w T 0:09:58.400 --> 0:10:02.480 I markets future markets were some the wrack below where 0:10:02.480 --> 0:10:05.160 we would normally be with regards to average daily volume. Here, 0:10:05.320 --> 0:10:07.600 gasoline price is going to finish the day slightly higher 0:10:07.640 --> 0:10:10.120 here as well, up about eight tenths of our percent. 0:10:10.559 --> 0:10:12.640 In the futures market at the pump, you're paying about 0:10:12.640 --> 0:10:15.440 three twenty nine on average. Here, Gold futures higher by 0:10:15.480 --> 0:10:17.319 about five tenths of our percent. And when you look 0:10:17.320 --> 0:10:19.319 at some of the soft commodities, pretty much everything is 0:10:19.360 --> 0:10:21.520 in the red today, with the exception of cotton. Cotton 0:10:21.520 --> 0:10:23.839 future stem up about one percent right now. We know 0:10:24.000 --> 0:10:27.440 restaurants around the country are continuing to struggle to pay 0:10:27.520 --> 0:10:30.600 for those higher input costs as COVID cases continue to 0:10:30.600 --> 0:10:33.040 surge as well. Restaurants are also struggling to keep their 0:10:33.040 --> 0:10:36.080 doors open. Many are trying to recoup their losses from 0:10:36.080 --> 0:10:39.280 the last twenty months or so when lockdown began. Joining 0:10:39.360 --> 0:10:41.560 us now is David Nafeld. He's the owner and executive 0:10:41.640 --> 0:10:44.679 chef of the restaurant Kfico. It's an Italian restaurant in 0:10:44.840 --> 0:10:47.360 San Francisco. David, thanks so much for joining us. You're 0:10:47.400 --> 0:10:50.160 also a member of the Independent Restaurant Coalition. It's an 0:10:50.200 --> 0:10:53.360 organization that calls itself a voice for the independent restaurant 0:10:53.360 --> 0:10:56.640 and bar community nationwide. Hey, give us an update on 0:10:56.679 --> 0:10:59.400 what's happening at KFICO right now when it comes to amicron. 0:10:59.640 --> 0:11:02.320 Are you seeing this not only affects staff right now, 0:11:02.400 --> 0:11:05.600 but uh but affect patrons dining there too. I mean 0:11:05.960 --> 0:11:09.440 cases are spiking in California, just like to our New York. Yeah, 0:11:09.440 --> 0:11:11.240 there's First of all, thank you so much for having me. 0:11:11.280 --> 0:11:14.440 And secondly, uh, you know, it's been a tremendous um 0:11:14.679 --> 0:11:17.000 hit to us. We've just made the hard decision to 0:11:17.040 --> 0:11:18.959 close both of the restaurants for the rest of the year. 0:11:19.480 --> 0:11:22.600 We've had a spike in positive cases, um you know, 0:11:22.720 --> 0:11:25.400 and the only reason we're able to detect that is 0:11:25.440 --> 0:11:28.800 because we've come out of pocket over five dollars to 0:11:29.720 --> 0:11:34.320 get these massively over inflated uh self tests right, because 0:11:34.720 --> 0:11:37.120 that's not being provided for us by our local, state 0:11:37.200 --> 0:11:39.200 or federal government. So that's something that we need to 0:11:39.240 --> 0:11:41.560 do to protect our own staff and to protect the public. 0:11:42.040 --> 0:11:43.840 Then you add to that the fact that when we 0:11:43.880 --> 0:11:46.200 get a number of positive cases, we try and do 0:11:46.320 --> 0:11:47.839 what we think is the right thing to do. By 0:11:47.840 --> 0:11:50.240 shutting down. We lose a tremendous amount of money doing that. 0:11:50.760 --> 0:11:53.120 We had to cancel all of our New Year's Eve reservations, 0:11:53.120 --> 0:11:56.240 which is supposed to be our single biggest revenue driver 0:11:56.440 --> 0:12:00.320 of the entire year. Um. You know, it is really 0:12:00.360 --> 0:12:04.600 really a tough time right now for us, our city, 0:12:04.640 --> 0:12:08.640 but also just our industry in general. Everyone is hurting. Um. 0:12:08.960 --> 0:12:14.720 I am seeing just dozens by the day restaurants locally, 0:12:14.960 --> 0:12:17.200 state and federally just say that they are going to 0:12:17.200 --> 0:12:18.679 shut down for the rest of the year because they 0:12:18.720 --> 0:12:21.560 don't know what's going on. And we all feel, honestly 0:12:21.800 --> 0:12:24.319 a bit abandoned by Congress who said that they were 0:12:24.320 --> 0:12:28.160 going to refill the restaurant Revitalization fund well over a 0:12:28.240 --> 0:12:32.120 year ago, and you have almost two thousand restaurants that 0:12:32.200 --> 0:12:34.800 applied for it that never got it. And right now 0:12:34.840 --> 0:12:37.559 we're we're all, you know, deciding on whether we're going 0:12:37.600 --> 0:12:40.600 to be able to open back up at all. Talk 0:12:40.760 --> 0:12:43.640 was a little bit about perhaps the EBBS and flows 0:12:43.720 --> 0:12:46.200 you've seen in terms of consumers that have come in 0:12:46.240 --> 0:12:48.680 while your restaurant was open as a result of say, 0:12:48.760 --> 0:12:52.120 vaccine mandates or mask mandates, which seemed to also ebb 0:12:52.120 --> 0:12:55.960 and flow in various states. Yeah, I mean evan flow 0:12:56.040 --> 0:12:58.199 is a great way to put it. There's been moments 0:12:58.360 --> 0:13:02.839 where um consumer um confidence is up and they want 0:13:02.840 --> 0:13:06.040 to come in, they want to dine inside. And you 0:13:06.080 --> 0:13:09.920 will see one news report come out within a day 0:13:10.200 --> 0:13:13.640 and you'll see reservations for the next week be impacted. 0:13:13.920 --> 0:13:18.360 You'll see a demand for outdoor seating go from all 0:13:18.400 --> 0:13:21.720 time high to almost zero in the colder months here 0:13:21.720 --> 0:13:24.640 in San Francisco and and obviously I can imagine in 0:13:24.679 --> 0:13:28.160 the colder parts of the country, it's it's completely nullified, 0:13:28.840 --> 0:13:30.800 uh to a news report will come out and then 0:13:30.800 --> 0:13:32.280 people all of a sudden are willing to dine in 0:13:32.280 --> 0:13:35.240 the rain outside, right, Um, but they don't want to 0:13:35.240 --> 0:13:38.800 eat inside. And so that is incredibly hard for a 0:13:38.840 --> 0:13:41.839 restaurant to whether the storm of It's very hard in 0:13:41.920 --> 0:13:44.520 terms of predictability and visibility as to how much we 0:13:44.559 --> 0:13:46.480 need to order, how much we need to staff, and 0:13:46.480 --> 0:13:49.000 then staffing. As you guys said in your previous segment 0:13:49.160 --> 0:13:52.120 is you know, something that is very challenging for all 0:13:52.120 --> 0:13:54.439 of us to deal with. UM. You know, we tend 0:13:54.480 --> 0:13:56.280 to pay on the higher side in terms of our 0:13:56.320 --> 0:13:58.760 restaurant group to begin with, but you know, it is 0:13:58.800 --> 0:14:01.480 something that you know, the guest is going to feel 0:14:01.480 --> 0:14:05.040 the impact because of raising prices all across the board. 0:14:05.080 --> 0:14:07.640 You know, our cost of goods have gone up through 0:14:07.679 --> 0:14:10.320 the roof, our losses have gone up through the roof, 0:14:10.360 --> 0:14:14.360 our debt has increased, UM, you know, and labor is 0:14:14.480 --> 0:14:16.199 just gonna go up and up and up to get 0:14:16.360 --> 0:14:19.920 viable candidates, David, what what brings stability here? What what 0:14:19.960 --> 0:14:22.800 would you want to see with regards to assistance and 0:14:22.880 --> 0:14:25.160 help that you think can maybe bring some normalcy and 0:14:25.200 --> 0:14:28.720 stability to this industry. Well, there's one answer, right, There's 0:14:28.720 --> 0:14:32.680 one simple, silver bullet answer, and that's the Restaurant Revitalization Fund, 0:14:32.760 --> 0:14:37.120 which we are at the Independent Restaurant Coalition were fighting 0:14:37.120 --> 0:14:41.520 for since March. We fought UM, you know, and when 0:14:41.600 --> 0:14:45.760 every other restaurant UM you know, trade group gave up 0:14:45.800 --> 0:14:48.320 on it, we fought for independent restaurants and we were 0:14:48.360 --> 0:14:50.600 able to get it for over a hundred thousand restaurants. 0:14:50.640 --> 0:14:54.720 There's a hundred and seventy seven thousand more restaurants that 0:14:54.800 --> 0:14:56.640 signed up for it that didn't get it. And now 0:14:56.680 --> 0:14:58.480 what Congress is doing is there in the business of 0:14:58.520 --> 0:15:02.240 choosing winners and losers rather than refilling it as Senator 0:15:02.320 --> 0:15:04.640 Senator Schumer promised he would. He promised this was a 0:15:04.680 --> 0:15:07.120 down payment on the rest of it. And what we 0:15:07.200 --> 0:15:08.640 need them to do is we need to kind of 0:15:08.680 --> 0:15:11.520 belly up to the bar, pay for this and help 0:15:11.600 --> 0:15:13.480 us get to the other side of this, because if 0:15:13.520 --> 0:15:17.280 they do, I promise you, they will be saving millions 0:15:17.280 --> 0:15:19.880 of jobs. And those are jobs ultimately that they're not 0:15:19.920 --> 0:15:21.760 going to have to take care of down the road. David, 0:15:21.760 --> 0:15:23.320 just very briefly, in the last minute we we have 0:15:23.400 --> 0:15:25.720 with you, you may make the case here and talk 0:15:25.720 --> 0:15:27.560 a little bit of the scarring that that could occur 0:15:27.600 --> 0:15:30.359 to the industry into cities and towns throughout the country 0:15:30.480 --> 0:15:33.560 if independent restaurants don't get this aid. Yeah. Well, this 0:15:33.600 --> 0:15:36.520 is a simple case to make, right. We um produce 0:15:36.800 --> 0:15:39.520 more to the GDP than almost any other industry. We 0:15:39.600 --> 0:15:42.440 provide more jobs than almost any other industry. We're talking 0:15:42.440 --> 0:15:45.520 about fifteen million jobs and counting that our industry in 0:15:45.520 --> 0:15:49.520 independent restaurants alone provide to our economy the amount of 0:15:49.560 --> 0:15:52.560 tax revenue to our cities. All of that is why 0:15:52.760 --> 0:15:55.800 our industry is worth saving. And most importantly, something we 0:15:55.840 --> 0:15:58.040 need to remember is you don't need a college degree, 0:15:58.040 --> 0:15:59.640 and you don't even need a high school degree to 0:15:59.640 --> 0:16:01.760 get into the restaurant industry to make it into the 0:16:01.800 --> 0:16:04.280 middle class. If you work in our industry, work your 0:16:04.320 --> 0:16:06.720 way up, you can open a small business. And small 0:16:06.760 --> 0:16:10.680 businesses the cornerstone of our economy. Yeah, well said small businesses, 0:16:10.720 --> 0:16:13.320 certainly the cornerstone, and she point out restaurants really the 0:16:13.360 --> 0:16:16.320 lifeblood of so many communities and so many of our 0:16:16.360 --> 0:16:19.200 cities out there. It's kind of what makes our cities cities. 0:16:19.240 --> 0:16:21.480 David really appreciate you take a time to be with us, 0:16:21.560 --> 0:16:24.160 and we wish you the best. David Mayfield there, he's 0:16:24.160 --> 0:16:27.080 a part of the Independent Restaurant Coalition and he's an 0:16:27.080 --> 0:16:30.320 owner and chef of KFICO out there in San Francisco. 0:16:30.640 --> 0:16:32.520 Of course, the solution to all this is getting the 0:16:32.560 --> 0:16:35.080 COVID crisis under control. We're gonna talk a little bit 0:16:35.080 --> 0:16:38.080 more about the COVID crisis and some new recommendations by 0:16:38.120 --> 0:16:41.240 the CDC. This one applying to cruise ships. We're gonna 0:16:41.280 --> 0:16:44.840 talk about that and so much more right here on Bloomberg. 0:16:51.840 --> 0:16:55.120 This is Bloomberg Market Special coverage all week long, simulcasts 0:16:55.120 --> 0:16:58.560 across Bloomberg TV, radio and YouTube. We welcome all of 0:16:58.600 --> 0:17:01.400 our audiences across all of our platforms. Remain bostic here 0:17:01.520 --> 0:17:04.159 alongside Tim Stenovik and Created Gupta, we're gonna be counting 0:17:04.160 --> 0:17:06.680 you down to the close of trading on this Thursday afternoon, 0:17:06.760 --> 0:17:09.440 just about one hour away. The SMP five hundred camped 0:17:09.440 --> 0:17:11.640 out at another record high, as is the Dow Jones 0:17:11.640 --> 0:17:14.199 Industrial Average, and NAZDAC one hundred came within just a 0:17:14.240 --> 0:17:16.200 few points of that record high. As far as the 0:17:16.240 --> 0:17:18.680 individual mover as well, it's kind of a mixed bag here. 0:17:18.720 --> 0:17:21.720 You have names like Apple not going much anywhere, basically 0:17:21.720 --> 0:17:24.119 flat on the day, Ford shares, which had been higher 0:17:24.119 --> 0:17:26.560 flat on the day. Uh, And then you got stocks 0:17:26.600 --> 0:17:29.600 like Peloton, like Zoom, A lot of these sort of 0:17:29.600 --> 0:17:31.359 memes stocks, I guess if you call them memes or 0:17:31.359 --> 0:17:34.080 pandemic blaze seemed to be back and focus, no real news. 0:17:34.119 --> 0:17:37.199 They're uh, crety with regards So what's moving those stocks 0:17:37.240 --> 0:17:39.800 and why? But I've seen a pretty significant drump Peloton 0:17:39.840 --> 0:17:42.320 shares up about nine percent right now. You know, even 0:17:42.359 --> 0:17:45.000 with the holiday trading, that quiet volume is still those 0:17:45.080 --> 0:17:48.199 names that seem to really become kind of familiar plays 0:17:48.440 --> 0:17:51.159 when it comes as hedges on the omicon variant, perhaps, 0:17:51.359 --> 0:17:52.920 or perhaps just the fact that those are the stocks 0:17:52.920 --> 0:17:55.920 that have been getting battered lately. So why not by 0:17:55.920 --> 0:17:59.119 the dip there? Yeah, Hey, does Apple hit three trillion 0:17:59.240 --> 0:18:01.440 by the end of the year. Uh, well that's tomorrow. 0:18:02.080 --> 0:18:04.760 I know you think it would happen tomorrow. We're saving 0:18:04.760 --> 0:18:06.960 it for them. It would be appropriate if it happen tomorrow. 0:18:06.960 --> 0:18:08.840 We're gonna do the show from Time Square, so the 0:18:08.880 --> 0:18:12.240 confetti we'll be ready here. Let's uh, we're gonna go 0:18:12.480 --> 0:18:14.320 get to our guests, Jason Pride in just a moment, 0:18:14.320 --> 0:18:15.639 but we want to jump over to Abigail do a 0:18:15.680 --> 0:18:17.760 little real quick, who is not in Times Square, but 0:18:17.760 --> 0:18:19.679 she's keeping a eye on the markets. I'm certainly not 0:18:19.720 --> 0:18:23.480 in Times Square right here at headquarters at lex and yes, 0:18:23.680 --> 0:18:25.720 everything that you guys have been saying, you know, steady 0:18:25.760 --> 0:18:28.800 as she goes Cruise Control rally, the SMP five hundred 0:18:28.880 --> 0:18:31.440 up three of the four days this week, interestingly, the NAZAC. 0:18:31.520 --> 0:18:35.639 This is the nazac's first update this week, climbing still 0:18:35.680 --> 0:18:38.679 not hitting a record high, nonetheless that stands out and 0:18:38.720 --> 0:18:43.399 speaking of trends, crude oil and it's best up streak 0:18:43.680 --> 0:18:46.200 going back to February now relative to that strength with 0:18:46.280 --> 0:18:48.240 the NAZAC, and I of course should say the SMP 0:18:48.280 --> 0:18:52.640 five likely to hit another record closing high seventy one 0:18:53.000 --> 0:18:55.840 of the year. Really pretty incredible and a third big 0:18:55.920 --> 0:18:58.639 up gear in a row. But the NAZACUT performance is 0:18:58.680 --> 0:19:01.639 coming from China Tech. It's a incredible the Golden Dragon 0:19:01.760 --> 0:19:04.840 NAZAC et f or index excuse me, up more than 0:19:04.880 --> 0:19:07.680 ten percent today. That is the best day going back 0:19:07.680 --> 0:19:11.600 to two thousand eight. However, into today on the year, 0:19:11.680 --> 0:19:14.520 it had been down almost fifty so talk about catchup 0:19:14.520 --> 0:19:17.399 falling night. But that's what's happening with Bai Dow and 0:19:17.440 --> 0:19:19.480 Ali Bob and a number of those other stocks really 0:19:19.520 --> 0:19:21.880 helping out again the NAZAC and the New York Fang Index. 0:19:22.680 --> 0:19:24.640 A comment on about what you just said was what 0:19:24.840 --> 0:19:27.520 is happening in the commodity space. Have we hit the 0:19:27.640 --> 0:19:31.720 peak in the commandity rally or is there room to run? Well, 0:19:31.760 --> 0:19:34.000