1 00:00:00,080 --> 00:00:06,760 Speaker 1: Bloomberg Audio Studios, Podcasts, radio news. 2 00:00:11,600 --> 00:00:15,440 Speaker 2: This is the Bloomberg Surveillance Podcast. I'm Jonathan Ferrow, along 3 00:00:15,440 --> 00:00:18,360 Speaker 2: with Lisa Bromwitz and a Marie Hordern. Join us each 4 00:00:18,480 --> 00:00:21,360 Speaker 2: day for insight from the best in markets, economics, and 5 00:00:21,400 --> 00:00:24,720 Speaker 2: geopolitics from our global headquarters in New York City. We 6 00:00:24,760 --> 00:00:27,400 Speaker 2: are live on Bloomberg Television weekday mornings from six to 7 00:00:27,480 --> 00:00:31,000 Speaker 2: nine am Eastern. Subscribe to the podcast on Apple, Spotify 8 00:00:31,200 --> 00:00:33,479 Speaker 2: or anywhere else you listen, and as always on the 9 00:00:33,479 --> 00:00:36,880 Speaker 2: Bloomberg Terminal and the Bloomberg Business app. Pina Cheer of 10 00:00:36,880 --> 00:00:40,240 Speaker 2: Academy Securities, writing for the first time in weeks, I'm 11 00:00:40,240 --> 00:00:43,480 Speaker 2: optimistic about the outlook for the economy and for markets, 12 00:00:43,560 --> 00:00:46,440 Speaker 2: but it is tempered slightly by all the measures it 13 00:00:46,479 --> 00:00:48,479 Speaker 2: took to get here. Pete joins us now for more 14 00:00:48,520 --> 00:00:51,160 Speaker 2: peak and Morning Morning. Where's the encouragement come from? 15 00:00:51,240 --> 00:00:54,640 Speaker 3: Well, first, I wrote that like at nine am on Sunday, So. 16 00:00:55,680 --> 00:00:57,120 Speaker 4: I'm buying not quite. 17 00:00:56,840 --> 00:00:58,080 Speaker 5: As encouraged as I was. 18 00:00:58,680 --> 00:00:58,960 Speaker 6: For me. 19 00:00:59,000 --> 00:01:00,680 Speaker 3: What I would really like to say see is a 20 00:01:00,760 --> 00:01:05,720 Speaker 3: true pivot towards domestic growth. Right, Let's get the chipsacked 21 00:01:05,760 --> 00:01:08,400 Speaker 3: money out there, you know, last Thursday at the cabinet meeting, 22 00:01:08,440 --> 00:01:11,119 Speaker 3: a couple of the people talked about shipbuilding. I think 23 00:01:11,160 --> 00:01:13,559 Speaker 3: we have to spend some money do some things domestic growth, 24 00:01:13,640 --> 00:01:17,000 Speaker 3: long term contracts. Either with shipbuild there's something to you know, 25 00:01:17,000 --> 00:01:19,240 Speaker 3: that we can really get our hands around and grow, 26 00:01:19,520 --> 00:01:22,440 Speaker 3: build up manufacturing without necessarily having to fight with the 27 00:01:22,480 --> 00:01:23,119 Speaker 3: rest of the world. 28 00:01:23,360 --> 00:01:24,679 Speaker 5: Do you think it slightly We'll see that. 29 00:01:25,760 --> 00:01:28,720 Speaker 3: I'm increasingly dubious. I did not, like, you know, all 30 00:01:28,720 --> 00:01:31,360 Speaker 3: the mixed messaging we got on tariffs over the weekend, 31 00:01:31,440 --> 00:01:35,080 Speaker 3: right from Friday night, no exception exemptions to more exemptions. 32 00:01:35,240 --> 00:01:37,280 Speaker 3: And I think I'm a little bit worried about bond 33 00:01:37,319 --> 00:01:39,720 Speaker 3: yields as a whole. Partly I do think foreigners should 34 00:01:39,720 --> 00:01:41,840 Speaker 3: be selling. I think you can get better yield than 35 00:01:41,880 --> 00:01:44,240 Speaker 3: your own country. There's all this talk about, you know, 36 00:01:44,280 --> 00:01:48,120 Speaker 3: potentially fees on foreign holdings mar Alago Accord. But beyond that, 37 00:01:48,160 --> 00:01:49,960 Speaker 3: if you just take away, I think we missed three 38 00:01:50,000 --> 00:01:52,480 Speaker 3: things last week. The budget for the military. Trump wants 39 00:01:52,480 --> 00:01:54,440 Speaker 3: to do a trillion instead of eight hundred billion. That's 40 00:01:54,520 --> 00:01:56,360 Speaker 3: going to add to the budget. We just had very 41 00:01:56,400 --> 00:01:59,560 Speaker 3: large debt ceiling raises that gives them the opportunity. And finally, 42 00:01:59,640 --> 00:02:02,880 Speaker 3: dose the Thursday More Cabinet meeting basically said they're targeting 43 00:02:02,920 --> 00:02:04,760 Speaker 3: one hundred and fifty billion for this year instead of 44 00:02:04,760 --> 00:02:07,480 Speaker 3: a trillion, and places like the Wall Street Journal things 45 00:02:07,480 --> 00:02:09,280 Speaker 3: are reporting that they can't even come up with one 46 00:02:09,360 --> 00:02:11,880 Speaker 3: hundred and fifty billion. So we are not on the 47 00:02:11,919 --> 00:02:14,160 Speaker 3: right track on the deficit, which I think was everyone's 48 00:02:14,200 --> 00:02:16,520 Speaker 3: big hope. So I think bond yields lead US lower 49 00:02:16,880 --> 00:02:19,400 Speaker 3: across the board right now, until we do something domestic 50 00:02:19,440 --> 00:02:19,920 Speaker 3: to help. 51 00:02:19,760 --> 00:02:21,680 Speaker 1: Growth, bond yields lead US lower. 52 00:02:21,800 --> 00:02:22,720 Speaker 6: Can you elaborate on that? 53 00:02:22,840 --> 00:02:25,279 Speaker 1: By the way, coming out and saying that you're optimistic 54 00:02:25,320 --> 00:02:30,320 Speaker 1: and then this litany of negatives really is just you know, yes, 55 00:02:31,040 --> 00:02:33,440 Speaker 1: which gives you a thing change so quickly things are 56 00:02:33,560 --> 00:02:33,920 Speaker 1: so what are you? 57 00:02:34,000 --> 00:02:35,640 Speaker 3: And I was very, very very so I was thinking, 58 00:02:35,639 --> 00:02:37,919 Speaker 3: you know, we were like heading towards twenty percent down 59 00:02:37,919 --> 00:02:40,040 Speaker 3: from here, it feels like it might be more controlled. 60 00:02:40,320 --> 00:02:43,400 Speaker 3: I will watch very closely today this. You know, when 61 00:02:43,440 --> 00:02:46,320 Speaker 3: we went through the GFC and even the European debt crisis, 62 00:02:46,560 --> 00:02:48,359 Speaker 3: one thing that always struck me as key when we 63 00:02:48,440 --> 00:02:50,520 Speaker 3: moved to a new leg of the problem was you'd 64 00:02:50,520 --> 00:02:52,520 Speaker 3: get the announcement you were hoping for, so in this case, 65 00:02:52,600 --> 00:02:54,960 Speaker 3: tariff exemptions, and if you don't last a full day 66 00:02:55,000 --> 00:02:56,960 Speaker 3: on the rally, it tends to mean the market's now 67 00:02:57,000 --> 00:02:59,680 Speaker 3: looking through that and saying, Okay, yeah, these exemptions whatever, 68 00:02:59,720 --> 00:03:01,760 Speaker 3: let's what we actually have on the table. And it's 69 00:03:01,800 --> 00:03:04,040 Speaker 3: a lot of problems out there. And the other part 70 00:03:04,080 --> 00:03:05,720 Speaker 3: that makes me a little bit nervous that I think 71 00:03:05,760 --> 00:03:08,280 Speaker 3: we'll see is if we stick to tariff deals. I 72 00:03:08,280 --> 00:03:10,680 Speaker 3: think teriff deals are easy. I think we're going to 73 00:03:10,760 --> 00:03:13,079 Speaker 3: go after trade deals, and to me, trade deals will 74 00:03:13,120 --> 00:03:15,520 Speaker 3: require import quotas something like that on behalf of these 75 00:03:15,520 --> 00:03:18,080 Speaker 3: other countries and possibly restrictions on what they can do 76 00:03:18,120 --> 00:03:19,840 Speaker 3: with China. I don't think that's going to be that 77 00:03:19,919 --> 00:03:21,480 Speaker 3: easy for them to digest. So I think we'll learn 78 00:03:21,520 --> 00:03:24,320 Speaker 3: a lot more in the next coming this week about deals. 79 00:03:24,639 --> 00:03:27,120 Speaker 3: Tariff deals, I'm comfortable with it goes down trade deals, 80 00:03:27,200 --> 00:03:28,520 Speaker 3: I think we take another leag lower. 81 00:03:28,840 --> 00:03:30,839 Speaker 1: You know, I've seen somebody notes where people talk about 82 00:03:30,880 --> 00:03:34,000 Speaker 1: how exhausted they are and how stressful this period is, 83 00:03:34,040 --> 00:03:36,880 Speaker 1: and I was thinking about why, and there's this flood 84 00:03:37,080 --> 00:03:40,120 Speaker 1: of information and it's hard to understand what structure to 85 00:03:40,160 --> 00:03:43,040 Speaker 1: even put them in. What have we learned versus just 86 00:03:43,080 --> 00:03:46,160 Speaker 1: tidbits of information that are coming in at you in 87 00:03:46,280 --> 00:03:49,320 Speaker 1: rapid fire. Have we learned anything from the turmoil of 88 00:03:49,360 --> 00:03:52,400 Speaker 1: the past week. Are we passed peak uncertainty and heading 89 00:03:52,400 --> 00:03:55,080 Speaker 1: into something that we can more concretely hold. 90 00:03:55,240 --> 00:03:56,960 Speaker 3: So the biggest thing for me that I can't quite 91 00:03:57,000 --> 00:03:59,839 Speaker 3: figure out, and I think is really critical, is did 92 00:04:00,160 --> 00:04:02,560 Speaker 3: China get sucked into being more aggressive on tariffs by 93 00:04:02,720 --> 00:04:04,320 Speaker 3: how we play this out. Did we make it look 94 00:04:04,360 --> 00:04:06,760 Speaker 3: like it was the US versus everyone China was more 95 00:04:06,760 --> 00:04:09,720 Speaker 3: aggressive and now regrets it, Or did we learn that 96 00:04:09,800 --> 00:04:12,440 Speaker 3: China really doesn't care, that China spent four years preparing 97 00:04:12,480 --> 00:04:14,360 Speaker 3: for this and is really ready for the fight. 98 00:04:14,640 --> 00:04:15,840 Speaker 4: I lean towards the ladder. 99 00:04:15,880 --> 00:04:17,719 Speaker 3: I will give the people who talk about, you know, 100 00:04:17,720 --> 00:04:19,960 Speaker 3: out of the deal in forty chess, that it could 101 00:04:19,960 --> 00:04:21,880 Speaker 3: be the former, and I it's the former, that's great 102 00:04:21,880 --> 00:04:23,120 Speaker 3: because China will have to back off. 103 00:04:23,160 --> 00:04:23,880 Speaker 5: It was the ladder. 104 00:04:24,000 --> 00:04:25,560 Speaker 3: We're not really prepared for this at all. 105 00:04:25,760 --> 00:04:27,840 Speaker 2: And place you went there is there any sign that 106 00:04:27,920 --> 00:04:29,760 Speaker 2: China's coming to the tango? Do you see an I 107 00:04:29,800 --> 00:04:30,680 Speaker 2: think it's so no. 108 00:04:30,839 --> 00:04:32,200 Speaker 3: I think you know we have to go back and 109 00:04:32,320 --> 00:04:36,640 Speaker 3: we're about fifteen percent of China's exports, and you know, 110 00:04:36,680 --> 00:04:39,080 Speaker 3: I think they exempted twenty five percent, whether it last 111 00:04:39,200 --> 00:04:42,000 Speaker 3: or not, but I think that's also looking at it 112 00:04:42,040 --> 00:04:44,440 Speaker 3: on the raw dollar value. I think from a profit margins, 113 00:04:44,600 --> 00:04:47,680 Speaker 3: you know, we exempted probably China's most profitable things that 114 00:04:47,720 --> 00:04:50,120 Speaker 3: they export to US. I don't see them come to 115 00:04:50,160 --> 00:04:52,040 Speaker 3: the table. I see the rest of the world talking 116 00:04:52,040 --> 00:04:54,880 Speaker 3: to them. We've been so, you know, which is very dangerous. 117 00:04:54,880 --> 00:04:57,279 Speaker 3: And again, if you're in that part of the world, you. 118 00:04:57,320 --> 00:04:58,680 Speaker 5: Probably have to play nice with China. 119 00:04:58,680 --> 00:05:01,599 Speaker 3: Their military is there, their nave growing, It's unclear what 120 00:05:01,720 --> 00:05:03,719 Speaker 3: direction Trump wants to go on some of that, and 121 00:05:03,720 --> 00:05:05,240 Speaker 3: the rest of the world I think is very tired. 122 00:05:05,279 --> 00:05:08,719 Speaker 3: The uncertainty doesn't do well, and everyone knows it's going 123 00:05:08,760 --> 00:05:11,560 Speaker 3: to take years to rebuild manufacturing, which is why I 124 00:05:11,600 --> 00:05:13,560 Speaker 3: go back to I'd be much more optimistic if we 125 00:05:13,920 --> 00:05:16,799 Speaker 3: started doing things domestic. Maybe we buy ten billion dollars 126 00:05:16,800 --> 00:05:18,320 Speaker 3: of navy ships, but they have to be built in 127 00:05:18,320 --> 00:05:21,160 Speaker 3: the US shipyard, and that's going to be ten years 128 00:05:21,200 --> 00:05:22,880 Speaker 3: of delivery, but it can start that process. 129 00:05:23,000 --> 00:05:24,520 Speaker 2: We've talked a lot about the pressure that it's put 130 00:05:24,600 --> 00:05:26,800 Speaker 2: on Europe, and it's push Europe to do things that 131 00:05:26,920 --> 00:05:28,800 Speaker 2: is good for Europe. And I just wonder if this 132 00:05:28,839 --> 00:05:30,839 Speaker 2: pushes China to do things that is good for China 133 00:05:31,360 --> 00:05:33,240 Speaker 2: in line with what the President would actually like to 134 00:05:33,240 --> 00:05:35,560 Speaker 2: say from China, which is a rep banasy the economy 135 00:05:35,800 --> 00:05:37,240 Speaker 2: towards domestic consumption. 136 00:05:37,800 --> 00:05:38,560 Speaker 5: Are you hopeful? 137 00:05:38,880 --> 00:05:41,080 Speaker 3: No, I just don't think Chinese consumed the way we do. 138 00:05:41,120 --> 00:05:43,600 Speaker 3: I think, like quite frankly, no one consumes the way 139 00:05:43,600 --> 00:05:46,039 Speaker 3: the US does. We consume a lot, and that's another 140 00:05:46,040 --> 00:05:48,680 Speaker 3: concern about the economy. Right We're seeing some delinquencies tick 141 00:05:48,760 --> 00:05:51,120 Speaker 3: up with all this uncertainty. I think China's going to 142 00:05:51,200 --> 00:05:52,560 Speaker 3: try and do what they do trade with the rest 143 00:05:52,600 --> 00:05:55,240 Speaker 3: of the world, trade with us, and we're going to 144 00:05:55,240 --> 00:05:57,760 Speaker 3: figure out where they have the opportunities. Again, they've spilled 145 00:05:57,920 --> 00:06:01,400 Speaker 3: the last ten years building up ninety percent of rarest 146 00:06:01,400 --> 00:06:03,920 Speaker 3: and critical minerals are refined in China. We can get 147 00:06:03,960 --> 00:06:06,000 Speaker 3: them anywhere. I think that's not the hard part, whether 148 00:06:06,040 --> 00:06:09,080 Speaker 3: it's cost justified to get it anywhere, it's the refining, 149 00:06:09,080 --> 00:06:11,080 Speaker 3: and again that's going to take years. So China is 150 00:06:11,080 --> 00:06:13,320 Speaker 3: putting all this pressure on us. And again, this was 151 00:06:13,400 --> 00:06:16,400 Speaker 3: ridiculous five years ago. When we talked about this at Academy, Securities, 152 00:06:16,600 --> 00:06:19,000 Speaker 3: the number of things that are really critical to military 153 00:06:19,000 --> 00:06:21,159 Speaker 3: equipment that we are getting from China when we were 154 00:06:21,200 --> 00:06:24,120 Speaker 3: having all this friction with China was insane. So bringing 155 00:06:24,120 --> 00:06:26,200 Speaker 3: those back makes sense. But we've done it in such 156 00:06:26,200 --> 00:06:28,440 Speaker 3: a way that I think we've left ourselves vulnerable in 157 00:06:28,440 --> 00:06:28,960 Speaker 3: the meantime. 158 00:06:29,040 --> 00:06:31,480 Speaker 1: So it seems like we haven't really gotten much clarity 159 00:06:31,520 --> 00:06:34,720 Speaker 1: when it comes to understanding the off ramp between US 160 00:06:34,720 --> 00:06:36,039 Speaker 1: and China negotiations. 161 00:06:36,320 --> 00:06:37,400 Speaker 6: We do have a sense. 162 00:06:37,200 --> 00:06:39,920 Speaker 1: Though, of what that off ramp looks like for President 163 00:06:39,960 --> 00:06:43,240 Speaker 1: Trump to cater to a market, specifically the treasury market. 164 00:06:43,320 --> 00:06:44,720 Speaker 6: And I want to go back to something that. 165 00:06:44,640 --> 00:06:46,680 Speaker 1: You said, which is that you think that the bond 166 00:06:46,720 --> 00:06:49,160 Speaker 1: market is going to lead the rest of the market's 167 00:06:49,279 --> 00:06:53,000 Speaker 1: lower from here. Have we learned something about where that 168 00:06:53,040 --> 00:06:56,120 Speaker 1: Trump put is in terms of what kind of levels 169 00:06:56,120 --> 00:06:58,440 Speaker 1: of bond heals get him nervous. 170 00:06:59,200 --> 00:06:59,880 Speaker 5: A little bit? 171 00:07:00,000 --> 00:07:01,800 Speaker 3: But I think it was very easy with all the 172 00:07:01,839 --> 00:07:04,640 Speaker 3: noise last week to talk about this as being foreign selling. 173 00:07:04,720 --> 00:07:07,560 Speaker 3: This basis trade unwinding, right, So you know, FED said 174 00:07:07,560 --> 00:07:09,359 Speaker 3: they would you know, incur, you know, they would protect 175 00:07:09,360 --> 00:07:11,360 Speaker 3: the bond market, which I think they will, they'll buy 176 00:07:11,360 --> 00:07:13,360 Speaker 3: some here there. I don't think we're going QE, but 177 00:07:13,400 --> 00:07:14,840 Speaker 3: I think it was very easy to think of this 178 00:07:14,880 --> 00:07:18,120 Speaker 3: as a temporary thing. If the conversation starts turning as 179 00:07:18,200 --> 00:07:20,840 Speaker 3: I think it might, that our deficit isn't going away, 180 00:07:20,880 --> 00:07:23,040 Speaker 3: dose isn't being as successful as we wanted, we are 181 00:07:23,080 --> 00:07:26,520 Speaker 3: not being spendthrift. I think that starts putting even domestic 182 00:07:26,520 --> 00:07:28,840 Speaker 3: pressure on yous and people saying, well, maybe even with 183 00:07:28,920 --> 00:07:31,480 Speaker 3: inflation coming down, we're not at the right level. So 184 00:07:31,520 --> 00:07:33,560 Speaker 3: that to me would be a bigger problem, right, and 185 00:07:33,600 --> 00:07:35,960 Speaker 3: it'd be hard them. So what can he do? I'm 186 00:07:35,960 --> 00:07:36,800 Speaker 3: not sure at that point. 187 00:07:37,400 --> 00:07:39,400 Speaker 1: Okay, so if you get to like four seventy five, 188 00:07:40,080 --> 00:07:41,200 Speaker 1: if we get to five. 189 00:07:42,160 --> 00:07:43,920 Speaker 3: I think they're begging to come up with structure. 190 00:07:44,040 --> 00:07:44,440 Speaker 6: I don't know. 191 00:07:44,480 --> 00:07:47,560 Speaker 3: I think they're begging the FED to work for And again, 192 00:07:47,680 --> 00:07:49,480 Speaker 3: a lot of this happened overnight last time. 193 00:07:49,520 --> 00:07:50,960 Speaker 6: If it starts happening more and more. 194 00:07:50,920 --> 00:07:53,240 Speaker 3: During the day, that's where I think the fear comes out. 195 00:07:53,400 --> 00:07:54,680 Speaker 3: But I don't know what he can do other than 196 00:07:54,720 --> 00:07:58,000 Speaker 3: go keeping flip flopping on tariffs. And it feels like 197 00:07:58,040 --> 00:08:00,680 Speaker 3: they're kind of tired of flip flopping. On TARRAF And 198 00:08:00,720 --> 00:08:03,360 Speaker 3: the other part is with the sole deficit. Right, we 199 00:08:03,360 --> 00:08:05,400 Speaker 3: were at one time and it was always confusing how 200 00:08:05,440 --> 00:08:06,720 Speaker 3: much of that was going to be the case. But 201 00:08:06,840 --> 00:08:09,040 Speaker 3: tariffs are going to help reduce our deficit. Well, if 202 00:08:09,040 --> 00:08:11,200 Speaker 3: that income's not really coming in, where are they going 203 00:08:11,240 --> 00:08:12,680 Speaker 3: to get other income? And I think they're going to 204 00:08:12,720 --> 00:08:17,160 Speaker 3: target foreign holders of treasuries again, there's talk about, you know, 205 00:08:17,240 --> 00:08:18,840 Speaker 3: delisting some of the Chinese ADRs. 206 00:08:18,920 --> 00:08:19,720 Speaker 4: I don't see what. 207 00:08:19,640 --> 00:08:22,240 Speaker 3: That really does at this point, but you know that 208 00:08:22,280 --> 00:08:24,800 Speaker 3: probably triggers yet another response from China. And I just 209 00:08:24,880 --> 00:08:27,600 Speaker 3: keep thinking that we expect China to make these simplified moves, 210 00:08:27,720 --> 00:08:30,400 Speaker 3: and we've talked about this before. She has learned something 211 00:08:30,440 --> 00:08:33,200 Speaker 3: Trump one point zero. She was the first one tomorrow lago. 212 00:08:33,520 --> 00:08:37,200 Speaker 3: Every time Trump said tariffs, they raise their hand trade delegation. 213 00:08:37,400 --> 00:08:40,360 Speaker 3: They have played this very differently. So just like Trump 214 00:08:40,400 --> 00:08:43,040 Speaker 3: administration has had four years to plan this, China has 215 00:08:43,120 --> 00:08:44,080 Speaker 3: had four years to plan this. 216 00:08:44,200 --> 00:08:45,240 Speaker 5: And it's beginning to look. 217 00:08:45,120 --> 00:08:47,800 Speaker 3: Like China spent a lot more time and money planning 218 00:08:47,800 --> 00:08:48,800 Speaker 3: this than the US did. 219 00:08:48,960 --> 00:08:51,120 Speaker 2: It doesn't look like a negotiation right now. In fact, 220 00:08:51,120 --> 00:08:52,760 Speaker 2: at least when I were talking about this, yesterday. It 221 00:08:52,800 --> 00:08:55,520 Speaker 2: looks like the US is negotiating potentially, but itself of 222 00:08:55,600 --> 00:08:57,400 Speaker 2: the moment, you're not hearing much back from China. 223 00:08:57,440 --> 00:08:58,959 Speaker 5: I wanted to finish on one final point with. 224 00:08:58,960 --> 00:09:01,240 Speaker 2: You, because you've been very consistent about this, is we 225 00:09:01,280 --> 00:09:02,640 Speaker 2: work our way through learning season. 226 00:09:03,080 --> 00:09:04,400 Speaker 5: You've ready ready rised the. 227 00:09:04,360 --> 00:09:07,240 Speaker 2: Flag about the damage being done to the American brand, 228 00:09:07,640 --> 00:09:10,480 Speaker 2: not about the attractiveness of US assets, but the attractiveness 229 00:09:10,520 --> 00:09:14,000 Speaker 2: of US goods, US services. How much damage has actually 230 00:09:14,000 --> 00:09:14,440 Speaker 2: been done. 231 00:09:14,520 --> 00:09:15,679 Speaker 3: I think we are going to see some of that, 232 00:09:15,720 --> 00:09:17,599 Speaker 3: and it's this first wave is going to be a 233 00:09:17,640 --> 00:09:19,839 Speaker 3: little bit difficult to tell whether it's just because of 234 00:09:19,880 --> 00:09:23,160 Speaker 3: global economic weakness that foreign sales sell down, or you're 235 00:09:23,160 --> 00:09:25,200 Speaker 3: going to have to start looking is there an indication 236 00:09:25,280 --> 00:09:28,000 Speaker 3: that's ay Cadbury, for example, starts doing better than some 237 00:09:28,040 --> 00:09:30,440 Speaker 3: of our brands overseas, and that I think will be 238 00:09:30,480 --> 00:09:33,040 Speaker 3: the real key. Try and figure out pairs where Okay, 239 00:09:33,120 --> 00:09:36,120 Speaker 3: here's a European or other brand and are there sales 240 00:09:36,120 --> 00:09:39,080 Speaker 3: declining or changing relative to the US brands. And I 241 00:09:39,080 --> 00:09:41,800 Speaker 3: think that would be a big shock to the system, 242 00:09:41,800 --> 00:09:44,080 Speaker 3: because I do think people believe and you can see 243 00:09:44,080 --> 00:09:45,920 Speaker 3: it in some of the price action today that there's 244 00:09:45,920 --> 00:09:49,079 Speaker 3: just this huge demand for our brands globally and it's 245 00:09:49,120 --> 00:09:52,200 Speaker 3: only being affected by tariffs. I think we've diminished that 246 00:09:52,400 --> 00:09:55,200 Speaker 3: as part of this overall trading strategy, and that's going 247 00:09:55,240 --> 00:09:57,560 Speaker 3: to be harmful, and I think we may even see 248 00:09:57,600 --> 00:09:59,320 Speaker 3: some companies talk about it. I think it's too early 249 00:09:59,360 --> 00:10:01,680 Speaker 3: this quarter, but as this goes on, I think that 250 00:10:01,800 --> 00:10:03,200 Speaker 3: becomes an issue for the rest of the year. 251 00:10:03,320 --> 00:10:05,120 Speaker 2: Interesting want to watch, Peter, it's going to see you. 252 00:10:05,240 --> 00:10:07,960 Speaker 2: Thanks for dropping by bitter chair there and Academy Securities. 253 00:10:17,960 --> 00:10:19,600 Speaker 2: If you look at for stability in the bond marketing, 254 00:10:19,600 --> 00:10:21,440 Speaker 2: you've got it. At the moment, we're down across the board. 255 00:10:21,440 --> 00:10:23,600 Speaker 2: Here across the curve, we're down six or seven basis 256 00:10:23,600 --> 00:10:25,960 Speaker 2: points at the front end on a ten year maturity, 257 00:10:25,960 --> 00:10:28,120 Speaker 2: the yield is down six to let's call it four 258 00:10:28,280 --> 00:10:31,120 Speaker 2: forty three. Let's turn to the economy. US consumer sentiment 259 00:10:31,200 --> 00:10:34,280 Speaker 2: falling to its second weakest reading on record, while inflation 260 00:10:34,400 --> 00:10:38,640 Speaker 2: expectations saw to multi decade highs Nita Richardson of ABP, writing, 261 00:10:38,679 --> 00:10:42,600 Speaker 2: inflation has made consumers cautious, but rising incomes can help 262 00:10:42,640 --> 00:10:46,600 Speaker 2: cushion any tariff driven price increases if they come neither 263 00:10:46,640 --> 00:10:49,000 Speaker 2: joined us now for more need a good morning. Let's 264 00:10:49,040 --> 00:10:51,200 Speaker 2: just focus on the data and get away from the politics. 265 00:10:51,520 --> 00:10:53,679 Speaker 2: Or income is still rising, you. 266 00:10:53,640 --> 00:10:56,720 Speaker 7: Know, we're seeing that when we look at payroll at ADP, 267 00:10:56,880 --> 00:10:59,400 Speaker 7: they're certainly rising, not as fast as they were two 268 00:10:59,480 --> 00:11:02,240 Speaker 7: years ago, but at a healthy clip, faster than before 269 00:11:02,280 --> 00:11:05,520 Speaker 7: the pandemic. There's also a different source of income that's 270 00:11:05,679 --> 00:11:08,240 Speaker 7: really important to think about, which is the housing market. 271 00:11:08,280 --> 00:11:12,000 Speaker 7: We get housing starts this later this week. Home equity 272 00:11:12,240 --> 00:11:15,600 Speaker 7: for home owners is up almost nine percent from a 273 00:11:15,640 --> 00:11:18,840 Speaker 7: year ago. So no, it's not the highest home equity 274 00:11:18,880 --> 00:11:21,760 Speaker 7: we'd seen on record, but it's close. It's like the 275 00:11:21,800 --> 00:11:24,480 Speaker 7: third highest, and so that's another level of question. 276 00:11:24,600 --> 00:11:25,400 Speaker 6: I don't mean to be. 277 00:11:25,360 --> 00:11:28,360 Speaker 7: Too polyann on a Monday, but I also want to 278 00:11:28,360 --> 00:11:32,800 Speaker 7: give a real data reality check to all the uncertainty 279 00:11:32,880 --> 00:11:33,760 Speaker 7: that's out there in the market. 280 00:11:33,880 --> 00:11:35,800 Speaker 6: I was just going to say, you're not complying with 281 00:11:35,840 --> 00:11:36,920 Speaker 6: the narrative. I love it. 282 00:11:37,000 --> 00:11:38,600 Speaker 1: I think it's great, and I think it's good to 283 00:11:38,600 --> 00:11:40,800 Speaker 1: push back against it because there's so much gloom and 284 00:11:40,800 --> 00:11:43,720 Speaker 1: doom about companies who are frozen, who aren't going to 285 00:11:43,760 --> 00:11:45,920 Speaker 1: be hiring, They're not going to be firing, but job 286 00:11:45,960 --> 00:11:49,720 Speaker 1: mobility just isn't there. You're still seeing just some signs 287 00:11:49,760 --> 00:11:52,760 Speaker 1: the consumers are maintaining resilience through other means, even with 288 00:11:52,800 --> 00:11:55,199 Speaker 1: the stock market that may be rallied last week, but 289 00:11:55,240 --> 00:11:57,760 Speaker 1: certainly didn't feel like it, and even with the idea 290 00:11:57,840 --> 00:11:59,200 Speaker 1: that it might be harder to get a raise. 291 00:12:00,080 --> 00:12:04,439 Speaker 7: I don't discount the sentiment because sentiment usually triggers certain behaviors. 292 00:12:04,480 --> 00:12:08,480 Speaker 7: And you see downbeat sentiment with consumers, with homebuilders, with CEOs, 293 00:12:08,559 --> 00:12:11,640 Speaker 7: everywhere you go. There is a pessimism in the outlook. 294 00:12:11,880 --> 00:12:14,400 Speaker 7: But then when you turn to the raw data, this 295 00:12:14,440 --> 00:12:17,720 Speaker 7: week is super important. Why this is the reference week. 296 00:12:17,880 --> 00:12:20,240 Speaker 7: This is the week that the BLS will start counting 297 00:12:20,320 --> 00:12:23,960 Speaker 7: the number of people who got paid for their employment report, 298 00:12:24,160 --> 00:12:26,840 Speaker 7: and this is the week the ADP will report in 299 00:12:26,960 --> 00:12:29,280 Speaker 7: of two weeks to talk about the labor market. 300 00:12:29,640 --> 00:12:31,600 Speaker 6: And if you look at this week and you. 301 00:12:31,559 --> 00:12:34,040 Speaker 7: Compare it to March, what you're seeing is that hiring 302 00:12:34,240 --> 00:12:37,960 Speaker 7: is still solid. And if you look at one area 303 00:12:38,000 --> 00:12:41,040 Speaker 7: of sentiment that is holding up worker sentiment, we're actually 304 00:12:41,040 --> 00:12:45,760 Speaker 7: going to produce a worker sentiment index tomorrow, publish it 305 00:12:45,800 --> 00:12:49,160 Speaker 7: at adpresearch dot com. What you'll see is that while 306 00:12:49,200 --> 00:12:52,160 Speaker 7: consumers are downbeat, workers are highly engaged. 307 00:12:52,160 --> 00:12:52,920 Speaker 6: They're plugged in. 308 00:12:53,320 --> 00:12:56,040 Speaker 7: Maybe it's because they're cautious about their job loss, but 309 00:12:56,080 --> 00:12:58,480 Speaker 7: they're showing off the hair or engaged, and they are 310 00:12:58,640 --> 00:13:01,120 Speaker 7: productive and they're doing so because they want to make 311 00:13:01,160 --> 00:13:03,960 Speaker 7: sure that they keep those jobs as they move into 312 00:13:04,000 --> 00:13:04,840 Speaker 7: the rest of the year. 313 00:13:04,920 --> 00:13:07,240 Speaker 1: So qui quitting has died basically is what you're saying, 314 00:13:07,240 --> 00:13:08,079 Speaker 1: which is actually. 315 00:13:07,840 --> 00:13:09,960 Speaker 6: Pursueing really welcome. That's fantasting less. 316 00:13:10,160 --> 00:13:13,600 Speaker 1: I'm curious you say that hiring is remaining solid. Is 317 00:13:13,640 --> 00:13:15,760 Speaker 1: it in specific industries they give you a sense of 318 00:13:15,800 --> 00:13:19,640 Speaker 1: contentially whether this is a resilience factor or whether this 319 00:13:19,800 --> 00:13:21,719 Speaker 1: is people getting old and needing to cater to them 320 00:13:21,720 --> 00:13:22,320 Speaker 1: of getting fatter. 321 00:13:22,600 --> 00:13:25,160 Speaker 7: Yeah, that's a great question, because we really do see 322 00:13:25,200 --> 00:13:27,960 Speaker 7: a good news bad news scenario there. We're seeing hiring 323 00:13:28,000 --> 00:13:30,880 Speaker 7: across firm sizes. That's good news, especially if you look 324 00:13:30,920 --> 00:13:35,040 Speaker 7: at small businesses who are price takers in the global 325 00:13:35,080 --> 00:13:39,520 Speaker 7: input market. We're seeing solid hiring across the board, but 326 00:13:39,640 --> 00:13:42,600 Speaker 7: not every industry. In fact, if you look at consumer 327 00:13:42,679 --> 00:13:47,120 Speaker 7: facing industries or somewhat discretionary like leisure and hospitality, it's 328 00:13:47,160 --> 00:13:50,240 Speaker 7: been weaker. If you look at retail also weaker, so 329 00:13:50,280 --> 00:13:54,000 Speaker 7: we're seeing hiring and ironically manufacturing. So we don't know 330 00:13:54,040 --> 00:13:56,559 Speaker 7: if that's pull forward hiring they get ahead of some 331 00:13:56,600 --> 00:13:59,720 Speaker 7: of these tariff and trade changes, or if this is 332 00:13:59,760 --> 00:14:02,120 Speaker 7: a real rebound and we're seeing it in B to 333 00:14:02,200 --> 00:14:05,160 Speaker 7: B services but not so much in consumer facing. In 334 00:14:05,240 --> 00:14:08,280 Speaker 7: the series, that is a sea change, and it's tied 335 00:14:08,320 --> 00:14:11,280 Speaker 7: directly to consumers and how they're feeling about the economy. 336 00:14:11,360 --> 00:14:14,040 Speaker 2: You talked about the importance of expectations. Let's talk about 337 00:14:14,040 --> 00:14:16,560 Speaker 2: how consumers are feeling about this economy. You med Channel 338 00:14:16,640 --> 00:14:21,360 Speaker 2: Friday consumer sentiment almost three year low, inflation expectations, multi 339 00:14:21,400 --> 00:14:26,240 Speaker 2: decade highs unemployment expectations the worst since two thousand and nine. 340 00:14:26,600 --> 00:14:29,840 Speaker 2: Are you seeing anything in the hard data to validate 341 00:14:30,400 --> 00:14:34,000 Speaker 2: consumer confidence that week? That poor that we saw on Friday. 342 00:14:34,200 --> 00:14:37,840 Speaker 7: On the labor market, now, layoffs are at a two 343 00:14:37,920 --> 00:14:41,320 Speaker 7: year low. They continue to hover around those two year 344 00:14:41,360 --> 00:14:44,640 Speaker 7: lows in the private sector. Different for the federal government, 345 00:14:44,680 --> 00:14:47,640 Speaker 7: but in the private sector, we are not seeing that 346 00:14:47,720 --> 00:14:50,960 Speaker 7: kind of upturn and upheaval and pause and hiring that 347 00:14:51,320 --> 00:14:54,080 Speaker 7: is being projected or picked up in the sentiment. Now, 348 00:14:54,120 --> 00:14:57,600 Speaker 7: things can change rapidly I'm not saying that the outlook 349 00:14:57,680 --> 00:15:00,160 Speaker 7: that we're seeing right now is going to be consistent 350 00:15:00,240 --> 00:15:02,560 Speaker 7: six months from now. But if you're looking at the 351 00:15:02,600 --> 00:15:05,520 Speaker 7: starting point in the baseline, you're seeing, and I think 352 00:15:05,600 --> 00:15:08,760 Speaker 7: Chair Pal said this and his recent remarks, a labor 353 00:15:08,840 --> 00:15:11,600 Speaker 7: market that is solid and continues to perform. 354 00:15:11,800 --> 00:15:14,560 Speaker 2: Still this massive, massive sprint lace of bestween the soft 355 00:15:14,600 --> 00:15:16,800 Speaker 2: and hot data. I keep going back to that headline 356 00:15:16,800 --> 00:15:19,920 Speaker 2: from you, Mitch. To see unemployment expectations down at the 357 00:15:19,960 --> 00:15:23,160 Speaker 2: worst levels we've seen since two thousand and nine is 358 00:15:23,200 --> 00:15:24,080 Speaker 2: pretty staggerant. 359 00:15:24,160 --> 00:15:26,280 Speaker 6: It was funny you were mentioned that. In the past 360 00:15:26,360 --> 00:15:26,880 Speaker 6: couple of weeks. 361 00:15:26,880 --> 00:15:29,360 Speaker 1: Lori Cavasina put that out in a report, saying that 362 00:15:29,400 --> 00:15:32,240 Speaker 1: in all of the earnings calls also, corporate executives have 363 00:15:32,280 --> 00:15:35,520 Speaker 1: been talking about how this reminds them of two thousand 364 00:15:35,560 --> 00:15:38,520 Speaker 1: and eight, This reminds them of twenty twenty, This reminds 365 00:15:38,520 --> 00:15:40,320 Speaker 1: them before that of the two thousands. 366 00:15:40,560 --> 00:15:41,320 Speaker 6: You see that in the. 367 00:15:41,280 --> 00:15:44,960 Speaker 1: AAII sentiment survey as well. So at a certain point, 368 00:15:45,200 --> 00:15:47,960 Speaker 1: have we really reached a new paradigm shift though, where 369 00:15:48,000 --> 00:15:50,960 Speaker 1: suddenly the soft data has not been predictive of the 370 00:15:51,000 --> 00:15:53,280 Speaker 1: hard data. Are we going back to something more normal 371 00:15:53,400 --> 00:15:55,160 Speaker 1: where you would normally see a correlation there. 372 00:15:55,200 --> 00:15:57,160 Speaker 2: So the Federal Reserve is not blinking and Native the 373 00:15:57,200 --> 00:15:59,840 Speaker 2: Federal Reserve will be meeting in early May. That meeting 374 00:16:00,000 --> 00:16:02,680 Speaker 2: and Cluthes, we'll get that decision on May seventh. What 375 00:16:02,840 --> 00:16:05,040 Speaker 2: you make have kind of navigated things so far and 376 00:16:05,160 --> 00:16:06,800 Speaker 2: what would you expect to see in a few weeks time. 377 00:16:06,920 --> 00:16:09,520 Speaker 7: I think the Fed is navigated the way Main Street has. 378 00:16:09,680 --> 00:16:12,640 Speaker 7: They're waiting and watching. There hasn't been any big money 379 00:16:12,680 --> 00:16:16,160 Speaker 7: moves that we can identify, and I think it's too 380 00:16:16,200 --> 00:16:18,840 Speaker 7: early on the policy front to make any firm movements. 381 00:16:18,880 --> 00:16:20,720 Speaker 7: And that's what you're seeing from the FED. But it's 382 00:16:20,720 --> 00:16:23,480 Speaker 7: also what you're seeing from small businesses and medium sized 383 00:16:23,520 --> 00:16:27,200 Speaker 7: businesses who can't change operations on a dime. Consumers can't 384 00:16:27,280 --> 00:16:29,920 Speaker 7: change spending patterns on a dime. So what you're seeing 385 00:16:30,040 --> 00:16:33,160 Speaker 7: is an economy that started from a solid baseline in 386 00:16:33,240 --> 00:16:34,840 Speaker 7: wait and see mode, just like the FED. 387 00:16:35,000 --> 00:16:36,960 Speaker 1: You know, there is this discussion that we had and 388 00:16:37,040 --> 00:16:39,320 Speaker 1: it was off air, about whether this FED is going 389 00:16:39,360 --> 00:16:41,920 Speaker 1: to be really just targeting dysfunction in the treasure market 390 00:16:41,960 --> 00:16:43,800 Speaker 1: or whether they actually were going to be looking at 391 00:16:43,880 --> 00:16:45,800 Speaker 1: levels we're not going to close the spreads until the 392 00:16:45,800 --> 00:16:47,600 Speaker 1: spreads get too wide, and then we're going to close them, 393 00:16:47,640 --> 00:16:50,920 Speaker 1: akin to maybe what the ECB has been doing. I 394 00:16:50,960 --> 00:16:54,960 Speaker 1: am curious about this theory that Neil Koshkari put out 395 00:16:54,960 --> 00:16:56,800 Speaker 1: over the weekend saying that we at the FED have 396 00:16:56,880 --> 00:17:00,320 Speaker 1: no ability, zero ability to affect that destination of your 397 00:17:00,360 --> 00:17:03,360 Speaker 1: yields as investors try to get some sort of price 398 00:17:03,400 --> 00:17:05,840 Speaker 1: discovery here. Do you believe that or do you think 399 00:17:05,920 --> 00:17:08,439 Speaker 1: that there is a level at which they do step in. 400 00:17:09,040 --> 00:17:13,240 Speaker 7: Well, I think this comes to your sentiment momentum distinction. 401 00:17:13,320 --> 00:17:16,760 Speaker 7: I mean, the FED operates at the short end of 402 00:17:16,800 --> 00:17:17,280 Speaker 7: the curve. 403 00:17:17,600 --> 00:17:19,240 Speaker 6: That is their mandate, and. 404 00:17:19,240 --> 00:17:22,800 Speaker 7: So I think if you take the literal interpretation of 405 00:17:22,840 --> 00:17:26,399 Speaker 7: the Fed's actions, yes, they are not responsible for the 406 00:17:26,440 --> 00:17:28,679 Speaker 7: longer end of the curve. But we know that the 407 00:17:28,760 --> 00:17:31,320 Speaker 7: FED has a huge sentiment role in all of us 408 00:17:31,359 --> 00:17:34,920 Speaker 7: in itself, and just by their forward guidance, they can 409 00:17:35,040 --> 00:17:37,879 Speaker 7: change the way the bond market reacts. So yes, and no, 410 00:17:38,080 --> 00:17:40,320 Speaker 7: pardon thoft, we're still back in that distinction. 411 00:17:40,320 --> 00:17:42,119 Speaker 1: So I guess to sum it all up, do you 412 00:17:42,240 --> 00:17:46,600 Speaker 1: see the unemployment rate rising quickly enough to get the 413 00:17:46,640 --> 00:17:50,760 Speaker 1: FED engaged in terms of cutting rates or having some 414 00:17:50,840 --> 00:17:54,399 Speaker 1: sort of stimulative effort in the near term, in the 415 00:17:54,440 --> 00:17:56,520 Speaker 1: next two weeks, the next three weeks before, or the 416 00:17:56,560 --> 00:17:59,480 Speaker 1: next two months, right before the economy really can turn. 417 00:18:00,280 --> 00:18:01,320 Speaker 6: Not in the next month. 418 00:18:01,400 --> 00:18:06,679 Speaker 7: No, we have not seen the transmission mechanism multiply to 419 00:18:06,760 --> 00:18:09,280 Speaker 7: an effect that it hits the real economy in a 420 00:18:09,359 --> 00:18:11,960 Speaker 7: way that you would see the kind of staggering job 421 00:18:12,080 --> 00:18:16,560 Speaker 7: loss that would justify on its own a rate. 422 00:18:16,480 --> 00:18:17,240 Speaker 6: Moved by the Fed. 423 00:18:17,440 --> 00:18:20,560 Speaker 7: The labor market is still holding up two hundred and 424 00:18:20,640 --> 00:18:24,439 Speaker 7: nine thousand private sector jobs created according to the federal 425 00:18:24,520 --> 00:18:27,440 Speaker 7: government last month. That's not going to be a downbeat 426 00:18:27,480 --> 00:18:29,000 Speaker 7: measure by anyone's estimation. 427 00:18:29,240 --> 00:18:31,200 Speaker 2: NATA, it's going to say, as always, thanks for dropping 428 00:18:31,200 --> 00:18:43,600 Speaker 2: by NATA. Riches in that of IDP, go to surround 429 00:18:43,600 --> 00:18:45,600 Speaker 2: a Tengo here in New York, Hendrida Trice. 430 00:18:45,600 --> 00:18:47,600 Speaker 5: If I had to promise Hendra go to see you. 431 00:18:48,200 --> 00:18:48,919 Speaker 5: Let's just get to this. 432 00:18:49,200 --> 00:18:51,439 Speaker 2: I'll be allowed exemptions or not do they exist? 433 00:18:51,600 --> 00:18:53,480 Speaker 8: I mean under the AEPA tariffs that went on that 434 00:18:53,520 --> 00:18:56,439 Speaker 8: are already at twenty percent, there are no exclusions except 435 00:18:56,480 --> 00:18:58,920 Speaker 8: in the case of like if you're giving a donation 436 00:18:59,040 --> 00:19:02,840 Speaker 8: from a religious and the semiconductors are tariff, the pharmaceuticals 437 00:19:02,840 --> 00:19:05,520 Speaker 8: are tariff. Everything coming in four hundred and ninety eight 438 00:19:05,600 --> 00:19:07,720 Speaker 8: billion dollars is effectively tariff. 439 00:19:07,760 --> 00:19:09,000 Speaker 6: So it's just going to get worse from. 440 00:19:08,840 --> 00:19:11,679 Speaker 2: Here with similar with all these different buckets. Speaking of 441 00:19:11,720 --> 00:19:15,040 Speaker 2: getting worse sectoral tariffs, what would they look like and 442 00:19:15,119 --> 00:19:16,160 Speaker 2: when would they be announced? 443 00:19:16,320 --> 00:19:18,399 Speaker 8: So I think that the two two tariffs are the 444 00:19:18,400 --> 00:19:21,320 Speaker 8: most pernicious kind that we can get, and in the 445 00:19:21,720 --> 00:19:24,680 Speaker 8: twenty twenty five environment, thirty day comment periods are pretty much. 446 00:19:24,600 --> 00:19:25,359 Speaker 6: All we should expect. 447 00:19:25,359 --> 00:19:28,480 Speaker 8: We saw with the auto investigation back in twenty nineteen, 448 00:19:28,600 --> 00:19:31,240 Speaker 8: was it that they don't even necessarily release the investigation 449 00:19:31,320 --> 00:19:32,240 Speaker 8: after it's confirmed. 450 00:19:32,240 --> 00:19:33,639 Speaker 6: You know, they're just putting these tariffs on. 451 00:19:33,720 --> 00:19:36,200 Speaker 8: So I think for pharma and for semiconductors, the worst 452 00:19:36,200 --> 00:19:38,720 Speaker 8: case scenario is that sometime in this thirty sixty ninety 453 00:19:38,760 --> 00:19:41,399 Speaker 8: day window, the tariffs go on, the comment period happens, 454 00:19:41,400 --> 00:19:42,320 Speaker 8: and the tariffs are on. 455 00:19:42,240 --> 00:19:42,879 Speaker 6: Before the summer. 456 00:19:43,080 --> 00:19:45,639 Speaker 1: What's the strategy here, That's a great question. 457 00:19:46,280 --> 00:19:50,200 Speaker 8: I mean, they want pharmaceutical manufacturer back in the United States. 458 00:19:50,280 --> 00:19:53,159 Speaker 8: We know that that takes five to seven years to 459 00:19:53,200 --> 00:19:57,439 Speaker 8: get the various approvals for even opening the facility, let 460 00:19:57,480 --> 00:19:59,520 Speaker 8: alone having the workers come in and actually do the 461 00:19:59,560 --> 00:20:02,919 Speaker 8: manufactur on those kinds of products. I think that the 462 00:20:02,920 --> 00:20:05,200 Speaker 8: semiconductor space is exactly the same. When I'm on calls 463 00:20:05,200 --> 00:20:08,200 Speaker 8: with investors, they're talking about, Thank goodness we had the 464 00:20:08,240 --> 00:20:12,280 Speaker 8: investment from the last administration into semiconductors, from the Chips 465 00:20:12,280 --> 00:20:14,000 Speaker 8: and Sciences Act of Bipartison. 466 00:20:13,640 --> 00:20:14,720 Speaker 6: Build it passed years ago. 467 00:20:15,040 --> 00:20:17,679 Speaker 8: To keep providing any kind of support to the industry 468 00:20:17,680 --> 00:20:19,199 Speaker 8: because it's going to get slamed from the tariffs. 469 00:20:19,200 --> 00:20:22,880 Speaker 1: I'm just asking, because the complications here are pretty dramatic. 470 00:20:22,920 --> 00:20:24,840 Speaker 1: Trying to keep track of which tariffs have gone on. 471 00:20:24,920 --> 00:20:27,960 Speaker 1: Where is a gold task when you try to talk 472 00:20:28,000 --> 00:20:30,760 Speaker 1: about what the actual effective tariff freight is, let alone, 473 00:20:30,960 --> 00:20:32,760 Speaker 1: how you plan for the future and what that could 474 00:20:32,760 --> 00:20:34,560 Speaker 1: be with additional rounds of tariffs coming on. 475 00:20:35,080 --> 00:20:36,280 Speaker 6: What are people telling you? 476 00:20:36,680 --> 00:20:39,000 Speaker 8: That's the stories that I hear the most are the 477 00:20:39,040 --> 00:20:42,120 Speaker 8: anecdotal data points. As you were talking before about connecting 478 00:20:42,119 --> 00:20:44,560 Speaker 8: the soft data to the hard data. The bankruptcies that 479 00:20:44,560 --> 00:20:50,080 Speaker 8: they're expecting, the seizing up at the ports, the manufacturers halting, hiring, 480 00:20:50,119 --> 00:20:55,040 Speaker 8: halting production, keeping their products on ships. 481 00:20:54,720 --> 00:20:55,520 Speaker 6: In cargo ships. 482 00:20:55,520 --> 00:20:59,119 Speaker 8: There's a lot of reminiscing about covid era when the 483 00:20:59,160 --> 00:21:00,960 Speaker 8: ships were just in the port. We're going to have 484 00:21:01,000 --> 00:21:03,399 Speaker 8: to all go back to like monitoring the Pacific Ocean 485 00:21:03,440 --> 00:21:03,919 Speaker 8: and see what. 486 00:21:03,960 --> 00:21:04,960 Speaker 6: Kind of fleets are out there. 487 00:21:04,960 --> 00:21:07,560 Speaker 8: That's what folks are talking about now and anticipating seeing 488 00:21:07,560 --> 00:21:08,960 Speaker 8: in the hard data in the next couple weeks. 489 00:21:08,960 --> 00:21:11,280 Speaker 2: It just got a message from a Limbug subscriber. This 490 00:21:11,320 --> 00:21:13,840 Speaker 2: sounds very chaotic. The market seems to have price peak, 491 00:21:13,920 --> 00:21:15,000 Speaker 2: chaos is behind us. 492 00:21:15,240 --> 00:21:17,000 Speaker 5: What are we missing? What are we missing? 493 00:21:17,080 --> 00:21:18,880 Speaker 8: I don't think the stories have come out yet about 494 00:21:18,920 --> 00:21:21,760 Speaker 8: how this is going to impact actual domestic manufacturers who 495 00:21:21,800 --> 00:21:25,240 Speaker 8: rely on foreign imports. You were mentioning critical minerals before. 496 00:21:25,400 --> 00:21:29,960 Speaker 8: How are you supposed to make your windshield wiper sensors 497 00:21:30,000 --> 00:21:32,160 Speaker 8: if you don't have the magnets that go into it. 498 00:21:32,400 --> 00:21:34,639 Speaker 8: So if you stockpiled enough in the last couple of 499 00:21:34,720 --> 00:21:38,200 Speaker 8: months to get in around that, you have some certainty 500 00:21:38,200 --> 00:21:41,800 Speaker 8: for a couple of weeks. But it's not a sustainable situation. 501 00:21:41,880 --> 00:21:43,440 Speaker 8: I think the hard data is going to come out 502 00:21:43,720 --> 00:21:46,639 Speaker 8: next for the next couple of weeks and months, and 503 00:21:46,680 --> 00:21:48,199 Speaker 8: these tariffs are not going to come off, especially if 504 00:21:48,200 --> 00:21:50,520 Speaker 8: they're done during under two thirty two, those are the 505 00:21:50,520 --> 00:21:51,280 Speaker 8: most pernicious. 506 00:21:51,320 --> 00:21:53,720 Speaker 6: Three oh one is pernicious. I mean these have real 507 00:21:53,760 --> 00:21:55,120 Speaker 6: standing power for years, and. 508 00:21:55,080 --> 00:21:58,600 Speaker 2: Then we need some relief taxes. What's changing with the 509 00:21:58,640 --> 00:21:59,639 Speaker 2: tax push at the moment? 510 00:22:00,200 --> 00:22:02,080 Speaker 8: Man, You know how I feel about this. The tax 511 00:22:02,320 --> 00:22:05,480 Speaker 8: component they're now President Trump is talking about is tax 512 00:22:05,520 --> 00:22:09,320 Speaker 8: cuts and deregulation. You are not permitted to pass deregulation 513 00:22:09,600 --> 00:22:12,960 Speaker 8: via reconciliation instructions, and Democrats will not be working with 514 00:22:13,000 --> 00:22:16,560 Speaker 8: Republicans on a crypto bill or any other deregulatory legislation. 515 00:22:16,800 --> 00:22:18,919 Speaker 6: So unless you like the emission standards. 516 00:22:18,520 --> 00:22:20,879 Speaker 8: Components which are going to get produced in a what 517 00:22:20,960 --> 00:22:24,520 Speaker 8: seventy five dollar barrel oil situation, you're not going to 518 00:22:24,560 --> 00:22:27,960 Speaker 8: see a deregulatory push anytime this year, and certainly not 519 00:22:28,040 --> 00:22:31,400 Speaker 8: until you get certain agency officials seated in their positions. 520 00:22:30,960 --> 00:22:31,600 Speaker 6: In the first place. 521 00:22:31,640 --> 00:22:33,480 Speaker 8: And then the tax bill I think is going to 522 00:22:33,480 --> 00:22:35,280 Speaker 8: take until the end of July, and as you know, 523 00:22:35,640 --> 00:22:40,200 Speaker 8: it includes four trillion dollars in deficit increases and very 524 00:22:40,240 --> 00:22:43,320 Speaker 8: little in the way of new stimulus. So I think 525 00:22:43,400 --> 00:22:46,440 Speaker 8: there's a disconnect between the narrative and reality. 526 00:22:46,600 --> 00:22:49,359 Speaker 1: Given that is there a loss of power that Trump 527 00:22:49,400 --> 00:22:51,919 Speaker 1: is having or a loss of a clutch over the 528 00:22:51,960 --> 00:22:53,440 Speaker 1: Republican House Caucus. 529 00:22:53,680 --> 00:22:54,879 Speaker 6: I don't buy that argument. 530 00:22:55,040 --> 00:22:57,320 Speaker 8: They passed the budget vote last week, and I think 531 00:22:57,400 --> 00:22:59,840 Speaker 8: that was the biggest hurdle. The next step is are 532 00:23:00,080 --> 00:23:03,200 Speaker 8: you going to vote for tax increases on every single American? 533 00:23:03,359 --> 00:23:04,719 Speaker 6: Or are you going to vote for this bill? And 534 00:23:04,720 --> 00:23:07,440 Speaker 6: that's a cut and dry. The whip is easy. All 535 00:23:07,480 --> 00:23:08,480 Speaker 6: members are going to support that. 536 00:23:08,720 --> 00:23:11,280 Speaker 1: There is a theory that if things get chaotic enough, 537 00:23:11,359 --> 00:23:14,240 Speaker 1: and if some of these proposals are outrageous enough, there 538 00:23:14,280 --> 00:23:16,520 Speaker 1: is going to be the ultimate check, which is going 539 00:23:16,560 --> 00:23:19,720 Speaker 1: to come by congressional action against some of these tariffs 540 00:23:19,880 --> 00:23:23,680 Speaker 1: or potentially a court action. Do you see any pathway 541 00:23:23,680 --> 00:23:25,800 Speaker 1: to that or are people just wishful thinking? 542 00:23:25,960 --> 00:23:26,040 Speaker 9: No? 543 00:23:26,160 --> 00:23:27,800 Speaker 8: I see no path for that either. If you can 544 00:23:27,840 --> 00:23:30,439 Speaker 8: get six or seven Republicans to join on to a 545 00:23:30,480 --> 00:23:33,760 Speaker 8: Senate bill, that is wildly insufficient. I think that President 546 00:23:33,800 --> 00:23:36,120 Speaker 8: Trump needs these members through this budget vote that happened 547 00:23:36,200 --> 00:23:38,399 Speaker 8: last week, and now through you know, let's call it 548 00:23:38,440 --> 00:23:40,840 Speaker 8: Memorial Day or July to pass this tax bill, and 549 00:23:40,880 --> 00:23:43,040 Speaker 8: then he doesn't need them at all, and no legislation 550 00:23:43,119 --> 00:23:43,640 Speaker 8: is going to pass. 551 00:23:43,680 --> 00:23:46,240 Speaker 6: There will be no Reconciliation Authority. There will be no 552 00:23:46,320 --> 00:23:47,480 Speaker 6: more legislation, which. 553 00:23:47,320 --> 00:23:49,399 Speaker 8: Is, by the way, the playbook from the first term, 554 00:23:49,480 --> 00:23:51,280 Speaker 8: where we got a tax bill initially and then spent 555 00:23:51,359 --> 00:23:52,840 Speaker 8: the next three years doing tariffs. 556 00:23:53,000 --> 00:23:53,960 Speaker 6: And that's what I expect here. 557 00:23:54,119 --> 00:23:56,040 Speaker 2: Just quickly we have the point where they're all quote 558 00:23:56,040 --> 00:23:58,320 Speaker 2: saying treasury yields to each other down on campbel Hill. 559 00:23:58,680 --> 00:23:59,639 Speaker 5: No way, not that yet. 560 00:24:00,359 --> 00:24:02,919 Speaker 6: I'm not sure we'll ever be there. I wouldn't expect that. 561 00:24:03,000 --> 00:24:04,760 Speaker 2: I hope we never get that, because if we get that, 562 00:24:04,800 --> 00:24:05,880 Speaker 2: we've got major problems. 563 00:24:06,000 --> 00:24:07,959 Speaker 1: Yeah, at one level, I kind of hope that they 564 00:24:08,000 --> 00:24:10,960 Speaker 1: do pay attention because it does actually matter suddenly, if 565 00:24:11,000 --> 00:24:13,600 Speaker 1: you have a fifty basis point increase in tenure yields, 566 00:24:13,640 --> 00:24:16,080 Speaker 1: that increases by billions of dollars the. 567 00:24:16,080 --> 00:24:17,960 Speaker 6: Amount of the United States is paying. So I hope 568 00:24:17,960 --> 00:24:19,520 Speaker 6: they do quote those treasure yields. 569 00:24:19,640 --> 00:24:22,360 Speaker 1: Congress Members, if you are listening, please get a Bloomberg 570 00:24:22,440 --> 00:24:24,000 Speaker 1: termin'll take a look at that ten yure yield, take 571 00:24:24,000 --> 00:24:25,040 Speaker 1: a look at a thirty year yield. 572 00:24:25,200 --> 00:24:27,119 Speaker 2: That's a sales pitch. I'm right there with you, and 573 00:24:27,160 --> 00:24:30,880 Speaker 2: please get that Bloomberg terminal. Clearly, the President was looking 574 00:24:31,000 --> 00:24:33,760 Speaker 2: very closely last weekend coming into the trade and weak. 575 00:24:33,840 --> 00:24:36,239 Speaker 1: Yeah, I got yippie people got a little nervous. But 576 00:24:36,359 --> 00:24:38,439 Speaker 1: he dealt with that in one statement, and that's what 577 00:24:38,480 --> 00:24:40,840 Speaker 1: he said. The issue is, do we have a true 578 00:24:40,880 --> 00:24:42,919 Speaker 1: sense of where that Trump put is. 579 00:24:43,240 --> 00:24:45,159 Speaker 6: Do we have a sense of what level, what type of. 580 00:24:45,200 --> 00:24:50,040 Speaker 1: Chaosk potentially end up dealing with some sort of response 581 00:24:50,240 --> 00:24:51,480 Speaker 1: from this administration. 582 00:24:51,600 --> 00:24:53,359 Speaker 2: Henry answer, it's good to see you. Thanks, thanks for 583 00:24:53,440 --> 00:24:56,480 Speaker 2: dropping by. Thank you, Henry to trace their evde upon visit. 584 00:25:06,520 --> 00:25:10,200 Speaker 2: Dorman Sachs adding to banking optimism after posting a record 585 00:25:10,280 --> 00:25:12,680 Speaker 2: revenue hall from its equity trading unit. 586 00:25:12,720 --> 00:25:14,040 Speaker 5: The stock is up by two percent. 587 00:25:14,320 --> 00:25:16,879 Speaker 2: To discuss some place to say is David Edison of 588 00:25:16,920 --> 00:25:19,800 Speaker 2: Fannessy Funds. David, Welcome to the program, sir, appreciate getting 589 00:25:19,800 --> 00:25:22,080 Speaker 2: some time with you. We've heard from Jape, Morgan from 590 00:25:22,080 --> 00:25:24,280 Speaker 2: Morgan Stanley from Goldman. How would you grade the quarter 591 00:25:24,359 --> 00:25:24,720 Speaker 2: so far? 592 00:25:26,320 --> 00:25:29,199 Speaker 9: Well, the quarters were great. I think the industry is 593 00:25:29,280 --> 00:25:33,159 Speaker 9: showing that they have done a great job of dealing 594 00:25:33,160 --> 00:25:37,760 Speaker 9: with credit and liquidity and capital managing the buybacks. So 595 00:25:37,880 --> 00:25:39,840 Speaker 9: I think the you know, it's like that's all in 596 00:25:39,880 --> 00:25:44,520 Speaker 9: the past, unfortunately, but I do think the industry is 597 00:25:44,560 --> 00:25:47,360 Speaker 9: in great shape to weather what's ahead. I think your 598 00:25:47,520 --> 00:25:50,040 Speaker 9: conversation with Gerard Cassie this morning sort of put it 599 00:25:50,080 --> 00:25:54,000 Speaker 9: in focus. But I think the industry is in great shape. 600 00:25:54,000 --> 00:25:55,919 Speaker 9: Doesn't mean the stocks are going to double or triple 601 00:25:56,040 --> 00:25:58,760 Speaker 9: or go down fifty percent, but I think as an 602 00:25:58,760 --> 00:26:02,640 Speaker 9: industry they're ready for whatever happens in Washington. 603 00:26:02,720 --> 00:26:05,360 Speaker 2: I think let's talk about that as a portfolio manager, 604 00:26:05,400 --> 00:26:08,680 Speaker 2: just how defensive do these names trade in growth scares? 605 00:26:08,680 --> 00:26:11,000 Speaker 2: And how has that changed over the last decade. 606 00:26:11,080 --> 00:26:15,000 Speaker 9: Say, well, I think since you know, two thousand and eight, 607 00:26:15,040 --> 00:26:17,159 Speaker 9: we've been worried about a credit cycle, worried about a 608 00:26:17,240 --> 00:26:17,800 Speaker 9: rate cycle. 609 00:26:17,840 --> 00:26:19,080 Speaker 4: We've had an inverted curve. 610 00:26:19,160 --> 00:26:23,320 Speaker 9: So the financials have been, you know, frankly not the 611 00:26:23,359 --> 00:26:25,600 Speaker 9: place to be for ten or twelve years, and I 612 00:26:25,680 --> 00:26:29,639 Speaker 9: think the color of my hair shows it. So I 613 00:26:29,680 --> 00:26:32,840 Speaker 9: think the hope is that as we go forward here, 614 00:26:33,320 --> 00:26:36,000 Speaker 9: there's going to be a you know, a little less 615 00:26:36,080 --> 00:26:38,800 Speaker 9: pressure on them as they you know, in a sense, 616 00:26:38,840 --> 00:26:41,560 Speaker 9: the terrorists are not attacking financial services products. 617 00:26:41,560 --> 00:26:44,160 Speaker 4: They're attacking physical goods, and so. 618 00:26:44,240 --> 00:26:46,240 Speaker 9: I think people maybe are going to be more worried 619 00:26:46,240 --> 00:26:49,280 Speaker 9: about the physical good traders and makers than they are 620 00:26:49,359 --> 00:26:52,000 Speaker 9: about the financial guys. So we'll see. I mean, Wall 621 00:26:52,040 --> 00:26:55,200 Speaker 9: Street finds a way to make money in all environments. 622 00:26:56,240 --> 00:26:59,040 Speaker 9: People need to lend money to grow. The economy is 623 00:26:59,080 --> 00:27:01,520 Speaker 9: not going to go to zero, and so I think, 624 00:27:01,760 --> 00:27:04,760 Speaker 9: you know, these companies could be the safe harbor that 625 00:27:04,800 --> 00:27:06,960 Speaker 9: they haven't been for the last ten or twelve years. 626 00:27:07,200 --> 00:27:09,879 Speaker 1: David, the narrative around banks has shifted. At the beginning 627 00:27:09,920 --> 00:27:12,280 Speaker 1: of this year, it was the growth stock, given the 628 00:27:12,320 --> 00:27:13,639 Speaker 1: fact that there was supposed to be a wave of 629 00:27:13,680 --> 00:27:17,320 Speaker 1: deregulation as well as a boom in mergers and acquisitions 630 00:27:17,359 --> 00:27:19,840 Speaker 1: and all sorts of deals. Now it's a defense stock, 631 00:27:19,880 --> 00:27:23,040 Speaker 1: where suddenly banks are buying back their own shares and 632 00:27:23,080 --> 00:27:26,240 Speaker 1: pretty large quantities. We just heard about a forty billion 633 00:27:26,680 --> 00:27:29,600 Speaker 1: dollary purchase from Goldman Sachs. 634 00:27:29,840 --> 00:27:32,000 Speaker 6: Which is it? Is it defense or offense? 635 00:27:34,320 --> 00:27:36,680 Speaker 9: Well, when you sort of have one guy deciding what 636 00:27:36,720 --> 00:27:39,920 Speaker 9: the world trade environment's going to be and a bunch 637 00:27:39,920 --> 00:27:43,080 Speaker 9: of other stuff, I think, you know, you look for 638 00:27:43,200 --> 00:27:45,360 Speaker 9: defensive names, and that means you look for a good 639 00:27:45,400 --> 00:27:48,600 Speaker 9: balance sheets, You look for capital, you look for liquidity, 640 00:27:49,400 --> 00:27:51,399 Speaker 9: and you look for good managers. And I think the 641 00:27:51,440 --> 00:27:55,960 Speaker 9: banks have that and so you know, this weekend was 642 00:27:56,000 --> 00:27:59,520 Speaker 9: pretty quiet on the Washington front. So the market's up. 643 00:27:59,560 --> 00:28:02,000 Speaker 9: So I think the general move of the market, I 644 00:28:02,040 --> 00:28:05,119 Speaker 9: think is, you know, the market generally wants to go 645 00:28:05,320 --> 00:28:07,720 Speaker 9: up in my view, and it's being held back by 646 00:28:08,160 --> 00:28:10,919 Speaker 9: sort of one guy making decisions about how the world's 647 00:28:10,960 --> 00:28:13,080 Speaker 9: going to function, and that I think will calm down 648 00:28:13,119 --> 00:28:14,840 Speaker 9: and we'll I think we'll be okay. 649 00:28:14,880 --> 00:28:15,439 Speaker 4: On the other. 650 00:28:15,359 --> 00:28:19,199 Speaker 1: Side, another way of sort of approaching the same question 651 00:28:19,359 --> 00:28:22,960 Speaker 1: is which banks are best positioned for the next phase 652 00:28:23,160 --> 00:28:25,280 Speaker 1: of whatever is to come. Is it the ones who 653 00:28:25,359 --> 00:28:28,719 Speaker 1: are going to benefit from volatility and markets trading revenues, 654 00:28:29,080 --> 00:28:32,840 Speaker 1: some of the potential other opportunities there, or is it 655 00:28:32,880 --> 00:28:35,520 Speaker 1: going to be the lenders the Bank of Americas They're 656 00:28:35,520 --> 00:28:39,000 Speaker 1: going to go out and actually be able to create 657 00:28:39,040 --> 00:28:41,760 Speaker 1: credit at a higher rate based on where the treasure 658 00:28:41,800 --> 00:28:42,640 Speaker 1: yield is right now. 659 00:28:44,760 --> 00:28:47,720 Speaker 9: Well, I think one of the concerns I think that's 660 00:28:47,720 --> 00:28:51,200 Speaker 9: coming up on the analysts that I've talked to and 661 00:28:51,240 --> 00:28:53,560 Speaker 9: the companies that I talked to prior to earnings was 662 00:28:53,600 --> 00:28:57,520 Speaker 9: that is this disruption going to really hurt small business 663 00:28:57,560 --> 00:29:01,400 Speaker 9: and therefore hurt the lending of the traditional banks that 664 00:29:01,480 --> 00:29:02,840 Speaker 9: we haven't heard from. 665 00:29:02,800 --> 00:29:05,040 Speaker 4: Yet, but we will in the next in the coming weeks. 666 00:29:06,120 --> 00:29:08,840 Speaker 9: I think the big banks, you know, they have the earnings, 667 00:29:08,840 --> 00:29:11,360 Speaker 9: they have the in the sense network effect of having 668 00:29:11,400 --> 00:29:13,520 Speaker 9: a lot of customers and a lot of data inputs 669 00:29:13,520 --> 00:29:17,960 Speaker 9: about what's going on. But I think the overriding thing 670 00:29:18,000 --> 00:29:20,840 Speaker 9: about this industry is that we need new products, we 671 00:29:20,880 --> 00:29:25,680 Speaker 9: need innovation, and we need companies to do transformative acquisitions 672 00:29:25,720 --> 00:29:27,680 Speaker 9: to kind of get them back on a growth path. 673 00:29:28,240 --> 00:29:31,200 Speaker 9: They've lost so much share on the lending side to 674 00:29:31,480 --> 00:29:34,640 Speaker 9: private equity and private debt and other sources of income 675 00:29:34,720 --> 00:29:38,680 Speaker 9: that the loans just don't grow anymore, and so they 676 00:29:38,760 --> 00:29:40,920 Speaker 9: need to do other things to get out of that 677 00:29:41,400 --> 00:29:44,440 Speaker 9: box that they're in. And hopefully that will happen as 678 00:29:44,480 --> 00:29:47,240 Speaker 9: we move forward with the new administration. 679 00:29:47,480 --> 00:29:49,200 Speaker 2: We've had lots of people say the same thing, that 680 00:29:49,240 --> 00:29:53,440 Speaker 2: we're expecting consolidation, particularly between the regionals and the smaller lenders. David, 681 00:29:53,920 --> 00:29:58,800 Speaker 2: what are you anticipating for the year ahead on that front, Well, it. 682 00:29:58,760 --> 00:30:02,600 Speaker 9: Started off pretty good. I think that, you know, I 683 00:30:02,680 --> 00:30:03,560 Speaker 9: don't think that's. 684 00:30:03,360 --> 00:30:03,960 Speaker 4: Going to stop. 685 00:30:03,960 --> 00:30:06,680 Speaker 9: I don't think whatever the administration is doing now is 686 00:30:06,720 --> 00:30:08,920 Speaker 9: going to stop that. I think at the end of 687 00:30:09,000 --> 00:30:13,200 Speaker 9: the day, the smaller banks know that they're losing share. 688 00:30:13,800 --> 00:30:17,200 Speaker 9: They can't invest in technology, it's hard for them to 689 00:30:17,240 --> 00:30:20,000 Speaker 9: compete with these new platforms that seem to be popping 690 00:30:20,080 --> 00:30:23,320 Speaker 9: up every day. They're competing for deposits and loans, and 691 00:30:23,360 --> 00:30:27,120 Speaker 9: so they need to get bigger. And that's, you know, 692 00:30:27,200 --> 00:30:31,280 Speaker 9: sort of the process that you see that in the marketplace. 693 00:30:31,320 --> 00:30:35,520 Speaker 9: The bigger companies have the higher valuations and the smaller 694 00:30:35,560 --> 00:30:37,360 Speaker 9: companies are going to being left behind. So I think 695 00:30:37,400 --> 00:30:39,880 Speaker 9: the market is telling you something and hopefully the managers 696 00:30:39,880 --> 00:30:41,520 Speaker 9: are hearing that and seeing it. 697 00:30:41,680 --> 00:30:44,160 Speaker 2: David, appreciate your time. Tricky moment for you all, I'm sure, 698 00:30:44,240 --> 00:30:48,960 Speaker 2: David Allison of Fantasy Funds. This is the Bloomberg Seventans podcast, 699 00:30:49,080 --> 00:30:53,000 Speaker 2: bringing you the best in markets, economics, antient politics. You 700 00:30:53,000 --> 00:30:55,800 Speaker 2: can watch the show live on Bloomberg TV weekday mornings 701 00:30:55,800 --> 00:30:58,760 Speaker 2: from six am to nine am Eastern. Subscribe to the 702 00:30:58,760 --> 00:31:02,280 Speaker 2: podcast on Apple, Spotify, or anywhere else you listen, and 703 00:31:02,320 --> 00:31:05,200 Speaker 2: as always on the Bloomberg Terminal and the Bloomberg Business 704 00:31:05,200 --> 00:31:05,400 Speaker 2: out 705 00:31:09,320 --> 00:31:09,840 Speaker 3: Mm hmm.