WEBVTT - Around The World 0:00:04.040 --> 0:00:07.360 Welcome to Boomberg Opinion. I'm Vanny Quinn. This week Stephen 0:00:07.440 --> 0:00:10.479 Mim on the Bahamas behn and maybe more senses than one, 0:00:10.840 --> 0:00:15.000 and in less the geopolitics changes, and then the reliability 0:00:15.040 --> 0:00:17.160 of Kazakhstan as a source for most of the world's 0:00:17.239 --> 0:00:19.720 uranium is going to be contest or David Fickling on 0:00:19.760 --> 0:00:22.360 how the uranium supply chain is a little too dependent 0:00:22.520 --> 0:00:25.560 on one nation for comfort. And later we'll speak with 0:00:25.600 --> 0:00:28.360 Juli Ran and China system of taxation, But first to 0:00:28.400 --> 0:00:31.280 the markets, and John alters this cautionary tale this week. 0:00:31.720 --> 0:00:34.040 Essentially he says, but where the barrage of predictions for 0:00:34.800 --> 0:00:38.200 three flooding or inbox right now? And John joins us. Now, John, 0:00:38.240 --> 0:00:39.879 we come to the Roman calendar year end with a 0:00:39.920 --> 0:00:42.440 bunch of assumptions, including that there's often a so called 0:00:42.440 --> 0:00:44.920 Santa Claus rally and so on. So let's first ask 0:00:45.159 --> 0:00:47.440 what does actually happen in terms of things like position 0:00:47.520 --> 0:00:49.880 squaring or profit taking or loss harvesting that we should 0:00:49.920 --> 0:00:52.720 be aware of in the run up to December thirty one. Well, 0:00:52.720 --> 0:00:55.440 it's it's often known in Britain as bed and breakfasting, 0:00:55.560 --> 0:00:58.760 the idea of taking losses to give yourself an allowance 0:00:58.840 --> 0:01:02.080 to maximize your ability to offset capital games. There's a 0:01:02.120 --> 0:01:04.479 lot of people have taken a lot of losses this year. 0:01:04.520 --> 0:01:07.360 You might well find that there's some confusing activity when 0:01:07.360 --> 0:01:11.160 that happens, and there's window addressing when people want to 0:01:11.280 --> 0:01:13.640 end the year with portfolios that make it look like 0:01:13.680 --> 0:01:17.680 they've been smart buying into stocks that have done well, 0:01:17.920 --> 0:01:20.479 even though it's almost exactly what they shouldn't be doing. 0:01:21.080 --> 0:01:24.520 It's difficult to work through exactly what that's going to 0:01:24.600 --> 0:01:28.119 imply for this year, when frankly, there was almost nothing 0:01:28.200 --> 0:01:30.080 you could have been in that would make you look smart, 0:01:30.360 --> 0:01:32.240 and it would be a great idea to prove that 0:01:32.280 --> 0:01:35.000 you were in cash at the beginning of the year. 0:01:35.040 --> 0:01:37.479 You don't really want to be in that position now. 0:01:38.319 --> 0:01:41.720 So it is going to be a strange final months 0:01:41.760 --> 0:01:44.160 of the year. And next week we have the final 0:01:44.319 --> 0:01:47.440 inflation numbers, followed immediately after by the f O m C. 0:01:48.000 --> 0:01:52.600 I suspect that's still overshadows absolutely everything else and wild 0:01:52.600 --> 0:01:55.840 in the foreseeable future, I imagine that will trump any 0:01:55.880 --> 0:01:57.760 of the excitement that would come with the end of 0:01:57.800 --> 0:02:00.240 the candy right, and we're actually almost lucky that there 0:02:00.280 --> 0:02:03.560 are still catalyst or it will be quite the long December. 0:02:03.600 --> 0:02:05.880 But something else that happens from early December usually as 0:02:05.880 --> 0:02:09.480 we get analyst predictions, huge long research notes outlining cell 0:02:09.560 --> 0:02:12.320 side assumptions for your head and predictions. One of the 0:02:12.320 --> 0:02:15.639 wilder predictions that did catch by. I don't know how 0:02:15.680 --> 0:02:18.280 many I've been through, but yeah, this is the time 0:02:18.320 --> 0:02:21.160 of year when you get a lot of predictions that 0:02:21.080 --> 0:02:24.520 The good side of this is that it's a very 0:02:24.560 --> 0:02:27.040 good discipline to force yourself to sit down as a 0:02:27.040 --> 0:02:30.200 piece of paper within a spreadsheet and come up with 0:02:30.240 --> 0:02:34.200 a clear prediction. There's no question that that's a good discipline. 0:02:34.240 --> 0:02:36.120 Just like a college, it's a good idea to actually 0:02:36.160 --> 0:02:39.440 have to write an essay or whatever. Actually publishing what 0:02:39.520 --> 0:02:42.280 you're expecting and what your assumptions are is a good idea, 0:02:43.040 --> 0:02:45.520 and a lot of the research that people produce at 0:02:45.520 --> 0:02:48.280 this time of year is pretty interesting. It's worth finding 0:02:48.320 --> 0:02:52.280 a way that says there's almost no point taking any 0:02:52.320 --> 0:02:55.160 notice at all of what they say for their final numbers, 0:02:55.200 --> 0:02:59.440 particularly for the stock market, because the stock markets on 0:02:59.520 --> 0:03:03.760 a year year basis is incredibly difficult to predict, and 0:03:04.160 --> 0:03:07.760 it tends you know the stock market rises by an 0:03:07.800 --> 0:03:10.080 average of seven or eight percent a year over time. 0:03:10.560 --> 0:03:13.880 It's very rarely rises by seven or eight percent in 0:03:13.880 --> 0:03:16.640 any one year. Tends to be up in double figures 0:03:16.800 --> 0:03:20.080 or very occasionally take a big ball, but it's unusual 0:03:20.280 --> 0:03:22.880 to get a year when it just gains about seven 0:03:23.000 --> 0:03:25.840 or eight percent, even though on average over the very 0:03:25.840 --> 0:03:27.880 long term that's what you can expect to get. But 0:03:28.000 --> 0:03:31.040 there is some usefulness to your head prognostications though, right 0:03:31.080 --> 0:03:33.760 even if it's only to knock people out of habitual thinking. 0:03:34.480 --> 0:03:37.800 I certainly agree that it's worth thinking through what you 0:03:37.880 --> 0:03:42.360 really believe. It would probably be more useful to try 0:03:42.400 --> 0:03:44.960 to come up with predictions five or ten years hence, 0:03:45.640 --> 0:03:49.160 which are impossible obviously so many unknowns. Once you've begin 0:03:49.200 --> 0:03:51.400 to go out further into the future, but you then 0:03:51.440 --> 0:03:55.320 have a much clearer scenario analysis, and you have much 0:03:55.400 --> 0:03:57.480 more of a grasp of what you see, both the 0:03:57.600 --> 0:04:01.839 risks and the opportunities. Being the long view move into 0:04:01.880 --> 0:04:03.880 the future. It's a cliche, but it is true that 0:04:03.960 --> 0:04:05.960 the more likely that the stock market is going to 0:04:05.960 --> 0:04:08.080 do well for you, but you still need to work 0:04:08.120 --> 0:04:12.520 out what criteria will determine exactly how well it does. Meanwhile, 0:04:12.560 --> 0:04:15.640 the fascinating thing wrote up with some research from Jannis 0:04:15.680 --> 0:04:19.600 Henderson is that analyst the pretty good at predicting how 0:04:19.680 --> 0:04:22.159 much of companies will earn, what their profits will be, 0:04:22.640 --> 0:04:28.240 and for one year that is almost useless. So this 0:04:28.360 --> 0:04:32.520 year was all about a fall in pe ratios, which 0:04:32.560 --> 0:04:37.000 almost nobody predicted, and earnings growth has been fine and 0:04:37.160 --> 0:04:40.120 almost exactly an a lot of people predicted. Doesn't help 0:04:40.160 --> 0:04:42.840 at all explain what's happened on the market this year 0:04:42.920 --> 0:04:45.120 or predict what was going to happen in the right 0:04:45.320 --> 0:04:47.800 And that's a real question. Has this year been an 0:04:47.800 --> 0:04:50.919 exception in terms of sharks or black swan events or 0:04:51.160 --> 0:04:55.320 our so called longer term trends still intact. My best 0:04:55.400 --> 0:05:00.200 guess is that it's probably a regime change year. I mean, 0:05:00.200 --> 0:05:03.840 the regime that started to change in It was obvious 0:05:03.880 --> 0:05:06.800 that something was going to give, and we've finally seen 0:05:06.839 --> 0:05:10.640 that this year because inflation really is back and the 0:05:10.680 --> 0:05:13.599 correlation between bonds and stocks is breaking down. So a 0:05:13.680 --> 0:05:17.800 lot of those assumptions finally got shaken this year, and 0:05:17.880 --> 0:05:19.840 that is one of the interesting things about looking at 0:05:19.839 --> 0:05:23.080 all the research. Incidentally, there is more dispersion than there 0:05:23.160 --> 0:05:26.480 usually is, meaning that you know, there's greater uncertainty and 0:05:26.560 --> 0:05:30.960 people are admitting to greater ansepty because a lot of 0:05:31.120 --> 0:05:34.960 reliable models for the last twenty years aren't working. On 0:05:35.120 --> 0:05:38.840 top of that, we had one very major bona fide shock, 0:05:38.880 --> 0:05:42.240 which of course the invasion of Krane, and frankly a 0:05:42.320 --> 0:05:45.120 shock that wasn't so much less in economic terms, which 0:05:45.160 --> 0:05:48.840 as zero COVID in China, that when everybody thought the 0:05:48.880 --> 0:05:53.120 pandemic was pretty much over, China suddenly started seeing it's 0:05:53.120 --> 0:05:55.520 ekond of be being far more affected by it than 0:05:55.560 --> 0:05:59.640 it had been before. So those are very major shocks 0:06:00.080 --> 0:06:03.080 at the point when the regime appears to be changing anyway. 0:06:03.520 --> 0:06:06.440 So this has been a very unusual year. We do 0:06:06.480 --> 0:06:08.600 seem to be having many of these unusual years and 0:06:09.240 --> 0:06:11.480 in the most recent decade. But John, even if you 0:06:11.760 --> 0:06:14.240 knew what was coming for sure, even if you're absolutely 0:06:14.240 --> 0:06:17.440 guaranteed that something was going to happen, would guarantee us 0:06:17.520 --> 0:06:21.159 a better return. It's not necessarily the case, isn't. No. 0:06:21.279 --> 0:06:23.839 I mean, if you've already discounted the good news ahead 0:06:23.880 --> 0:06:26.640 of time, then just as well that the good news 0:06:26.680 --> 0:06:29.640 finally materializes. But it doesn't particularly help you at that point. 0:06:30.560 --> 0:06:34.160 Even if you know what's coming, if the market is 0:06:34.480 --> 0:06:39.520 wildly overpriced is predicting what's coming, you could still come 0:06:39.560 --> 0:06:41.960 a cropper. You not only need to know what's coming, 0:06:42.000 --> 0:06:44.919 you also need to work out how well the market 0:06:44.960 --> 0:06:48.200 disposition for it, and if things are bad, you also 0:06:48.279 --> 0:06:53.760 need to understand what the systemic might be. So many 0:06:53.760 --> 0:06:56.839 of the other very interesting example this year, it's not 0:06:56.960 --> 0:06:59.880 a true Black Swan event because I don't think crypto 0:07:00.040 --> 0:07:03.760 big enough, but some of the horrors in crypto were 0:07:04.560 --> 0:07:08.200 very major, significant deals. And obviously because it's crypto, which 0:07:08.200 --> 0:07:10.160 has only been around a little bit more than a decade, 0:07:10.560 --> 0:07:14.120 there's a lack of precedents for it. Luckily, would appear 0:07:14.280 --> 0:07:18.840 that crypto isn't linked enough with trag fi as we 0:07:19.160 --> 0:07:23.960 have the traditional finance that it's going to cause a 0:07:24.040 --> 0:07:26.960 systemic events in itself. So John, given that the new 0:07:27.040 --> 0:07:29.080 Year that that we know and love or hate is 0:07:29.120 --> 0:07:31.320 not the new year in every geography or market, how 0:07:31.320 --> 0:07:35.240 do other markets do over US holidays? That's an interesting one. 0:07:35.640 --> 0:07:39.000 Thanksgipping can create some very weird dynamics in the rest 0:07:39.000 --> 0:07:41.080 of them because there's no real holiday at all, and 0:07:41.160 --> 0:07:45.400 it's complete shutdown here in the States Christmas. It's interesting 0:07:45.440 --> 0:07:48.080 almost the other way that Europe really does just go 0:07:48.120 --> 0:07:51.640 into complete hibernation for a whole week, and the US, 0:07:51.760 --> 0:07:54.320 despite being a more religious country in many ways, doesn't 0:07:54.400 --> 0:07:57.760 take Christmas so seriously. Yes, so you do get some 0:07:57.920 --> 0:08:01.960 very strange effects that way. In general, anything that's happened 0:08:02.040 --> 0:08:04.480 in the last two weeks of the year, though, is 0:08:04.640 --> 0:08:07.040 so likely to be driven by load liquidity that it 0:08:07.120 --> 0:08:10.000 can really alter perceptions in a way it shouldn't. And 0:08:10.080 --> 0:08:12.040 also the fact that you mentioned China earlier, we have 0:08:12.040 --> 0:08:15.440 another New Year coming up in a couple of months. Times, well, 0:08:15.440 --> 0:08:18.160 the Chinese New Year really messes things around. You have 0:08:18.240 --> 0:08:21.559 to any Chinese daity, you have to start applying moving 0:08:21.600 --> 0:08:23.960 averages to and stuff, or otherwise you just can't quite 0:08:23.960 --> 0:08:26.520 see what's happening because of the big shift caused by 0:08:26.520 --> 0:08:29.880 the moving lunar new year. Yes, you mentioned how Jannis 0:08:29.920 --> 0:08:32.960 Anderson had talked about the dispersion in predictions this year. 0:08:33.640 --> 0:08:35.600 One prediction you point out that seems to be almost 0:08:35.600 --> 0:08:38.079 a universal article of faith, and that's a quote from 0:08:38.080 --> 0:08:40.720 your column, is that the US will fall into a recession. 0:08:40.760 --> 0:08:43.480 But you point out the amount of vocabulary being used 0:08:43.600 --> 0:08:46.400 is hilarious, you know, playing villain a garden variety soft dish. 0:08:46.679 --> 0:08:49.360 But one phrase stood out to you, and that's rolling recession. 0:08:49.360 --> 0:08:52.000 It sounds very ominous. Explain what it is. I'm not 0:08:52.120 --> 0:08:54.640 I'm not sure that this is from ms and Saunders 0:08:54.720 --> 0:08:58.800 some ways almost moderately positive in the ideas that there's 0:08:58.840 --> 0:09:02.040 been a succession of different sectors that have felt the 0:09:02.120 --> 0:09:06.319 problems in turn and others that have done relatively wellness 0:09:06.320 --> 0:09:09.560 and results. That's in part because the initial pandemic had 0:09:09.640 --> 0:09:12.880 such differential effects, much bigger impact on some parts of 0:09:12.920 --> 0:09:15.560 the economy than those oil prices. The last pay checks 0:09:15.559 --> 0:09:19.880 are now actually down for the year, incredibly. It's possible 0:09:19.920 --> 0:09:21.840 that energy, which has been one of the factors that 0:09:21.880 --> 0:09:23.920 has kept everybody else the loft, is now going to 0:09:23.920 --> 0:09:27.400 be under performing and that that will help other factors. 0:09:27.920 --> 0:09:30.400 That's the notion of the Roding recession is that following 0:09:30.440 --> 0:09:33.360 the very unusual circumstances of pandemic, it will be an 0:09:33.400 --> 0:09:38.120 unusual recession which it's particular parts of the economy particularly 0:09:38.160 --> 0:09:42.440 badly at different times, but spares others at different times. 0:09:42.840 --> 0:09:44.160 So all we have to do is make sure we 0:09:44.200 --> 0:09:47.080 pick the right parts of the economy to exactly at 0:09:47.120 --> 0:09:51.360 any one time. Yes, Bloomberg Opinions, John Authors, stay tuned. 0:09:51.440 --> 0:09:54.600 Stephen mim next on the outlaw status of the Bahamas 0:09:54.760 --> 0:09:58.040 HQ two fd X in a long line of opaque enterprises. 0:09:58.240 --> 0:10:01.600 This is Bloomberg Opinion. You're listening to Bloomberg Opinion. I'm 0:10:01.679 --> 0:10:06.200 Vonnie Quinn the Bahamas. Who wouldn't want to be headquartered there? 0:10:06.200 --> 0:10:09.400 Work there, commute to and from that beautiful island nation. 0:10:09.840 --> 0:10:12.240 And yet well, let's pause for a moment and bring 0:10:12.280 --> 0:10:15.040 in Bloomberg Opinion columnist and the University of Georgia professor 0:10:15.080 --> 0:10:18.080 Stephen mim So. Stephen, Obviously, the reason we're talking about 0:10:18.080 --> 0:10:21.080 the Bahamas is it hosted the headquarters of Crypto Exchange 0:10:21.120 --> 0:10:23.800 f t X, which obviously imploded in recent weeks. We 0:10:23.840 --> 0:10:25.920 don't even know the extent of the damage caused by 0:10:25.920 --> 0:10:28.800 ft X and the associated Alameda. You say, though, that 0:10:28.840 --> 0:10:31.840 the first red flag came long before things like opaque 0:10:31.840 --> 0:10:34.680 balance sheets and oddline items. It was actually the fact 0:10:34.800 --> 0:10:38.160 that the HQ was the Bahamas. Why is that? Well, 0:10:38.280 --> 0:10:42.000 you know, the Bahamas have this longstanding reputation which is 0:10:42.080 --> 0:10:45.960 arguably quite deserved of being somewhat loose place legally, a 0:10:46.000 --> 0:10:49.160 place that really likes to tolerate. It has for decades 0:10:49.200 --> 0:10:54.319 tolerated so fairly shadowy banking operations and also very kind 0:10:54.320 --> 0:10:58.319 of fly by night financial operations. It has regulation, but 0:10:58.440 --> 0:11:02.080 they are not capably ministered at least haven't been. That's 0:11:02.120 --> 0:11:05.439 gotten a very bad reputation. Now is this something that 0:11:05.520 --> 0:11:09.320 a particular administration has guided the island towards or is 0:11:09.360 --> 0:11:12.160 this something that's been true of the Mohammas since the 0:11:12.200 --> 0:11:15.440 founding of the island nation. Well, you know, in a way, 0:11:15.760 --> 0:11:19.280 you could argue that geography is destiny on some level 0:11:19.480 --> 0:11:22.720 when it comes to the Bahamas, because it's incredibly close 0:11:22.800 --> 0:11:25.800 to the United States, so it's very convenient, but it's 0:11:25.840 --> 0:11:30.080 also operating completely outside of its legal shadow So um 0:11:30.440 --> 0:11:33.079 long ago, centuries ago, it was a center for piracy 0:11:33.200 --> 0:11:35.960 and people sort of operated there with community, even though 0:11:35.960 --> 0:11:39.280 it's a British colony basically kind of run by warlords 0:11:39.280 --> 0:11:43.320 Thomas Um. But later it became place to run guns 0:11:43.440 --> 0:11:45.960 during the Civil War and then during Prohibition. That's really 0:11:46.000 --> 0:11:49.880 when it's story really takes off. The white former kind 0:11:49.920 --> 0:11:55.320 of planter class got into rum bootlegging and shipping run 0:11:55.960 --> 0:11:59.040 and that seems to have created a kind of ethos 0:11:59.200 --> 0:12:03.439 on the island among the white ruling class that tolerated well, 0:12:03.520 --> 0:12:07.800 in that case, illegal operation. But that continued decade after decade. 0:12:08.000 --> 0:12:10.280 You know, in the nineteen thirties, as provision ended, it 0:12:10.559 --> 0:12:13.520 went into tax evasion. It became the go to place 0:12:13.600 --> 0:12:16.560 for evading high income taxes in the United States. And 0:12:16.640 --> 0:12:19.600 that's just kind of percolated. No, you say geography, but 0:12:19.720 --> 0:12:21.800 also I guess it's just out of the reach of 0:12:22.200 --> 0:12:26.280 other regulators. Can other kinds of authorities be involved when 0:12:26.280 --> 0:12:29.280 it comes to something like crime or shadowy behavior? I mean, 0:12:29.400 --> 0:12:32.400 could somebody be extradited from the Bahamas for example, Yes, 0:12:32.440 --> 0:12:35.760 there are tradition treaties. The bigger problem is the sharing 0:12:35.840 --> 0:12:39.800 of financial information and the Bahamas selective refusal to do 0:12:39.880 --> 0:12:43.440 so with other nations in a kind of reciprocal way. 0:12:43.640 --> 0:12:47.120 You know, it's gotten a lot of attention, negative attention, 0:12:47.400 --> 0:12:50.319 or being a place where you can have offshore bank 0:12:50.360 --> 0:12:54.000 accounts that are unregulated and untaxed, and you know, they've 0:12:54.000 --> 0:12:57.119 gotten a lot of pressure to comply with international regulation, 0:12:57.640 --> 0:13:00.480 especially after the year two thousand and because they were 0:13:00.520 --> 0:13:02.960 put on a blacklist. Basically that made it clear that 0:13:03.000 --> 0:13:05.560 you shouldn't do business with them. And so since that 0:13:05.679 --> 0:13:09.839 time they've sort of grudgingly cooperated, but they've done so 0:13:10.160 --> 0:13:13.120 through this rather clever way of saying, yes, we agree 0:13:13.160 --> 0:13:16.400 to share information. However we're only going to share information, 0:13:16.440 --> 0:13:18.360 say with the Cayman Islands, We're not going to share 0:13:18.360 --> 0:13:22.160 information with the EU or what have you. So it's like, 0:13:22.280 --> 0:13:25.640 basically they're cooperating with other tax havens, but not with 0:13:25.880 --> 0:13:29.839 core economic centers at the global financial system. Well that's fascinating. 0:13:29.880 --> 0:13:33.400 I mean, is there competition between tax havens? Then yes, 0:13:33.520 --> 0:13:36.160 there is. Actually it's kind of you know, it's like 0:13:36.200 --> 0:13:39.200 a race to the bottom. You know, remember the Panama papers. 0:13:39.280 --> 0:13:42.679 You know, Panamas is a place that Switzerland is obviously 0:13:42.960 --> 0:13:46.280 has a very different reputation. But then you have a 0:13:46.280 --> 0:13:50.840 lot of these other typically former colonial possessions now independent 0:13:50.960 --> 0:13:56.360 nations manual out to other South Pacific uh, small nations 0:13:56.480 --> 0:14:00.439 that have become places for this sort of offshore banking. 0:14:02.240 --> 0:14:04.800 What will change it? Because you know, we think of 0:14:04.840 --> 0:14:07.920 the Bahamas is this beautiful island nation. I'd love to 0:14:07.920 --> 0:14:09.920 work there, you know, you'd love to work from there. 0:14:09.920 --> 0:14:12.920 It'd be an easy commute. Would the Bahamas ever want 0:14:12.960 --> 0:14:14.880 to become sort of on the up and up as 0:14:14.880 --> 0:14:17.319 opposed to a place known for the fact that it 0:14:17.360 --> 0:14:20.400 has a little bit of an outlaw status. Well, you know, 0:14:20.480 --> 0:14:24.160 I think there's obviously a downside to the crypto implosion 0:14:24.320 --> 0:14:27.760 taking place within the Bombas and this doesn't give them 0:14:27.800 --> 0:14:32.400 a lot of credibility. And but it would be a 0:14:32.480 --> 0:14:35.320 very hard habit to shake, and historically has a lot 0:14:35.400 --> 0:14:39.320 to do with the relationship between a ruling class that 0:14:39.400 --> 0:14:43.800 has had a lot of involvement in very clandestine or 0:14:43.800 --> 0:14:46.720 shadowy things, and that's probably a very hard habit to break. 0:14:47.040 --> 0:14:51.080 It's changed a lot, obviously since independence in the nineteen seventies, 0:14:51.920 --> 0:14:54.640 but a lot of the original players they're known as 0:14:54.680 --> 0:14:56.880 the Bay Street Boys, which makes it sound like they're 0:14:56.920 --> 0:15:00.200 like a K pop band or something, but they're is 0:15:00.760 --> 0:15:05.040 the easy exactly. But these are like people of British 0:15:05.120 --> 0:15:08.880 descent who ran the islands for decades and cut all 0:15:08.880 --> 0:15:11.400 sorts of corrupt deals with organized crime and the like. 0:15:11.560 --> 0:15:13.160 And I think a lot of that still carries over 0:15:13.720 --> 0:15:16.760 and probably paved the way for when Crypto made its appearance. 0:15:16.840 --> 0:15:21.880 Like you know, here's a new kind of financial speculative 0:15:22.360 --> 0:15:26.160 entity that's unregulated. It's like, let's, you know, someone in 0:15:26.200 --> 0:15:28.080 the Bahamas, and they did. They really made a push 0:15:28.080 --> 0:15:30.680 for this, like let's bring crypto to the Bahamas, and 0:15:30.840 --> 0:15:35.680 they succeeded. Unfortunately, that's still very much in play of 0:15:35.840 --> 0:15:37.800 kind of like do you need a charter? You know, 0:15:38.000 --> 0:15:42.960 like and also conversely, interestingly enough, historically denying people charters 0:15:42.960 --> 0:15:45.640 people who come in and like someone else's Meyer Landsky 0:15:45.840 --> 0:15:48.040 mob figures like you're not letting them in and they 0:15:48.080 --> 0:15:51.680 can't build the I mean, the casino stuff is the 0:15:51.760 --> 0:15:54.680 whole awesome side of this. There was a great story 0:15:54.960 --> 0:15:57.960 this air to the Amp Fortune went in and tried 0:15:58.000 --> 0:16:02.720 to build a casino and keep built it on an 0:16:02.760 --> 0:16:06.960 island off of NASA, and then the Bay Street boys 0:16:07.000 --> 0:16:09.560 were like, now, like, you're not going to be allowed 0:16:09.600 --> 0:16:14.240 to take a boat out basically, I mean, it's bad 0:16:14.280 --> 0:16:18.600 for him. He got Bahamas blocked, Yes, Bahamas blocked exactly. Yeah. 0:16:18.600 --> 0:16:20.520 I mean, you have a column out that details some 0:16:20.560 --> 0:16:23.160 of these stories, and some of them are incredible and 0:16:23.360 --> 0:16:25.640 very fascinating, the type of thing that you know, we 0:16:25.720 --> 0:16:28.760 all love to read. But at the same time, often 0:16:28.800 --> 0:16:31.560 these things end very badly for a lot of people, 0:16:31.640 --> 0:16:34.040 as the ft X history is going to for a 0:16:34.080 --> 0:16:36.680 lot of people as well. What's the future for the Mohammas. 0:16:36.720 --> 0:16:38.680 I mean, the fact that a company is headquartered to 0:16:38.680 --> 0:16:42.360 the Mohammas. Is that enough to suggest that there should 0:16:42.360 --> 0:16:44.880 be a red flag or there plenty of companies that 0:16:44.920 --> 0:16:48.960 are completely transparent and operating completely in the open that 0:16:49.000 --> 0:16:52.400 are based there. There are legitimate companies that are based 0:16:52.440 --> 0:16:56.560 in the Bahamas, for sure, absolutely. What's troubling though is 0:16:56.640 --> 0:16:59.880 the number that are not so legitimate and have been 0:17:00.160 --> 0:17:02.440 you know historically this is I think less of a 0:17:02.560 --> 0:17:06.200 problem now, but in the nine seventies, for example, the 0:17:06.280 --> 0:17:09.439 late seventies, there were three hundred banks of the Bahamas. 0:17:09.480 --> 0:17:12.800 There were more banks than bars in the Bahamas, and 0:17:12.880 --> 0:17:16.800 the vast majority of them what are called like suitcase corporations. 0:17:16.840 --> 0:17:19.520 They were effectively a post office box and nothing more, 0:17:20.000 --> 0:17:22.800 but they were obtained a kind of bogus charter. So 0:17:22.840 --> 0:17:25.800 the problem is that while there are very legitimate businesses 0:17:25.840 --> 0:17:28.560 in the Bahamas, I have no doubt the damage that 0:17:28.680 --> 0:17:31.719 it does to those businesses to be in the same 0:17:31.800 --> 0:17:35.840 place as these other businesses is really unfortunate and I 0:17:35.880 --> 0:17:38.399 think then that goes to your question actually about like 0:17:38.520 --> 0:17:41.639 what is the future Bahamas, because it's like guilt by association, 0:17:41.760 --> 0:17:44.760 which may well be unfair, but that probably then has 0:17:44.800 --> 0:17:49.119 an unfortunate consequence on future development. I mean to some extent, 0:17:49.359 --> 0:17:51.879 I guess I or anybody wouldn't want to judge the 0:17:51.920 --> 0:17:56.399 island nation given that it needs tourism. Absolutely, I suppose 0:17:56.440 --> 0:17:59.040 the easy way to ask it, can we blame the Bahamas? No? 0:17:59.400 --> 0:18:02.280 And this is really what I've written in Certainly the 0:18:02.440 --> 0:18:05.320 reporting on there's the Bahamas really should not be blamed 0:18:05.480 --> 0:18:08.560 so much as Sam Bankman freed his associates and f 0:18:08.640 --> 0:18:11.440 t X, which were clearly operating in ways. You know. 0:18:11.720 --> 0:18:14.760 The The interesting thing though is for outside investors, the 0:18:14.800 --> 0:18:18.840 decision will locate there. You know, it should have been 0:18:18.920 --> 0:18:22.520 something that might have might have indicated that there could 0:18:22.520 --> 0:18:25.560 have been something because they since there is this history 0:18:25.680 --> 0:18:28.959 of not really asking to question when someone sets up 0:18:29.000 --> 0:18:32.400 financial operations in the island nation, and as it turns out, 0:18:32.400 --> 0:18:35.440 those fears would have been entirely justified about f t X. 0:18:35.720 --> 0:18:39.120 If someone is coming too who says, you can't see 0:18:39.119 --> 0:18:42.800 our balance sheet. We're based at the pomise like it's like, 0:18:43.040 --> 0:18:45.760 good Lord, you know, maybe you want to look into that. 0:18:46.280 --> 0:18:50.080 Bloomberg Opinion columnist and University of Georgia professor Stephen Mim 0:18:50.119 --> 0:18:54.119 you're listening to Boomberg opinion. I'm Vonnie Quinn. Kazakhstan reelected 0:18:54.160 --> 0:18:57.040 its incumbent president last month for the next seven years. 0:18:57.119 --> 0:18:59.960 President Okayev will run the two hundred billion dollar economy 0:19:00.119 --> 0:19:04.280 and the world's largest uranium producer. Now. Kazakhstan chair is 0:19:04.320 --> 0:19:07.120 the second largest border in the world with Russia, after 0:19:07.160 --> 0:19:09.360 the U. S. Canada border, and this is where things 0:19:09.400 --> 0:19:12.080 get complicated. Relations have been a little strained, to say 0:19:12.119 --> 0:19:14.800 the least, since Russia's invasion of Ukraine, which TOKAIV does 0:19:14.840 --> 0:19:18.160 not support. Bloomberg Opinions. Savid Fickling has been examining how 0:19:18.200 --> 0:19:20.919 countries who need uranium on their way to zero carbon 0:19:20.960 --> 0:19:23.840 power need to start figuring out their supply chain now 0:19:24.320 --> 0:19:26.920 or uranium might be the next critical mineral crisis. He 0:19:27.040 --> 0:19:29.640 joined us for a conversation. When we talk about uranium, 0:19:29.720 --> 0:19:32.120 I guess most of us immediately think about nuclear power, 0:19:32.160 --> 0:19:34.760 particularly after the experience of war in Ukraine. Though atomic 0:19:34.880 --> 0:19:37.560 energy is now not destined for extinction, so explained to 0:19:37.640 --> 0:19:41.040 us who were depending on for uranium and also uranium oxide, 0:19:41.080 --> 0:19:43.879 the material that's needed for nuclear power. Yeah, so I 0:19:43.920 --> 0:19:47.119 mean uranium oxide is the hided material that is produced 0:19:47.119 --> 0:19:49.840 by mind and events have further refined and produced the 0:19:49.920 --> 0:19:52.920 nuclear field that's actually put into nuclear path plants. Let's 0:19:52.960 --> 0:19:56.159 bear about about three quarters of nuclear generation happens essentially 0:19:56.160 --> 0:19:58.720 in our E C D countries Europe, North American developed ASA. 0:19:58.840 --> 0:20:00.680 That will shift a little bit to as we see 0:20:00.680 --> 0:20:03.560 more nuclear plants switched on in places like China, India, 0:20:03.640 --> 0:20:06.240 But essentially three quarters of nuclear generation is in the 0:20:06.320 --> 0:20:09.399 rich countries. But those countries there are allies, only provide 0:20:09.400 --> 0:20:12.800 about of the uranium that's actually needed to fuel those 0:20:12.840 --> 0:20:15.639 reactors you need each year about seventy five thousand tons 0:20:15.640 --> 0:20:19.600 of uranium side roughly two thirds comes from China, the 0:20:19.600 --> 0:20:23.520 former Soviet Union, around and Pakistan, essentially countries that are 0:20:23.560 --> 0:20:26.119 not well aligned with those rich countries. And as we 0:20:26.200 --> 0:20:29.400 look at the problems in twenty two of being dependent 0:20:29.480 --> 0:20:32.680 for fuel on a country with which you're not aligned geopolitically, 0:20:33.000 --> 0:20:34.840 we need to think pretty hard about the fact that 0:20:35.000 --> 0:20:39.000 the same situation prevails with uranium, and particularly a huge 0:20:39.000 --> 0:20:41.879 proportion of the world's uranium comes from just one country, Kazakhstan, 0:20:42.160 --> 0:20:44.680 and Kazakhstan's diplomatic position is quite an interesting one. It's 0:20:44.720 --> 0:20:47.399 become more interesting in twenty two They seem to have 0:20:47.440 --> 0:20:49.760 been wanting to be rather more independent of Russia than 0:20:49.760 --> 0:20:52.439 they have been historically. But if you just look at 0:20:52.480 --> 0:20:54.640 the position of Kazakhstan on the map, it is very 0:20:54.640 --> 0:20:56.959 hard for them to carve out a policy that's truly 0:20:57.000 --> 0:20:59.560 independent of Russia and China together, because they are sand 0:20:59.600 --> 0:21:03.080 much in those countries. David, how far out is uranium 0:21:03.119 --> 0:21:06.200 traded and how is it even traded as a contract. 0:21:07.119 --> 0:21:10.320 It's not an established and liquid futures market, and even 0:21:10.600 --> 0:21:13.479 pricing for uranium tends to be from sort of private sources. 0:21:13.480 --> 0:21:16.840 There are no widespread futures contracts in uranium. Having said that, 0:21:17.400 --> 0:21:19.640 there is a very clear idea of long term costs, 0:21:19.640 --> 0:21:21.200 and this is actually one of the reasons that you 0:21:21.240 --> 0:21:24.720 see Kazakhstan has become so dominant as a producer of uranium. 0:21:25.080 --> 0:21:27.600 Thirty dollars a pound is a sort of benchmark price 0:21:27.720 --> 0:21:32.360 for viability outside of Kazakhstan. Most production costs considerably more 0:21:32.359 --> 0:21:34.439 than that, and of course, if you think Back in 0:21:34.480 --> 0:21:37.080 the history of this in the two thousands, it was 0:21:37.119 --> 0:21:39.080 not expected that wind and solar would take off the 0:21:39.080 --> 0:21:41.320 way they did, so uranium was seen as a future 0:21:41.680 --> 0:21:44.600