Speaker 1: Hello, and welcome to another episode of the Odd Lots Podcast.
Speaker 1: I'm Joe Wisn't Thal and I'm Tracy all Away. So
Speaker 1: I don't know about you, Tracy, but I would definitely
Speaker 1: say that when the crisis hit earlier this year and
Speaker 1: the stock market crashed and layoff surge, I definitely got
Speaker 1: pretty intense flashbacks to uh, the Great Recession, the financial
Speaker 1: crisis ten years ago. Yeah, I mean I think a
Speaker 1: lot of people did. I think there were The big
Speaker 1: debate that was going on at the time was whether
Speaker 1: or not two thousand eight or two thousand twenty was
Speaker 1: going to be like the defining financial crisis for a
Speaker 1: particular group of people. And um, I think that debate
Speaker 1: is still going on. But for sure, we've never seen
Speaker 1: anything quite like this. And in March we had of
Speaker 1: financial crisis alongside a real economy crisis with lots of
Speaker 1: businesses going into lockdown and things like that, and I
Speaker 1: think that was probably the major difference with what we
Speaker 1: saw in two right, And I think now in December
Speaker 1: and looking at the aftermath, we could say safely that
Speaker 1: so far, anyway, the aftermath of what we experienced in
Speaker 1: March and April has really been nothing like the financial crisis.
Speaker 1: Of course, we have stocks not just at all time highs,
Speaker 1: but um well above the pre crisis highs. Already, home prices,
Speaker 1: there's a housing boom happening, which probably not a lot
Speaker 1: of people would have guessed. You know, the unemployment rate,
Speaker 1: it's still quite elevated, but it's come down a lot
Speaker 1: faster than a lot of people anticipated. So that another
Speaker 1: sort of difference from two thousand, two thousand nine, where
Speaker 1: the recovery and unemployment was extremely slow. Yeah. I think
Speaker 1: that's right. And certainly if you talk to a lot
Speaker 1: of people in March, no one would have expected to
Speaker 1: see their maybound in risk assets that we've seen, and
Speaker 1: no one would have expected that everyone would be buying,
Speaker 1: you know, houses, or those people that can afford them
Speaker 1: would be buying the houses. Um. I do think the
Speaker 1: big difference this time around has probably been how quickly
Speaker 1: uh the Federal Reserve reacted, and also how quickly Washington
Speaker 1: rolled out that stimulus package, which kind of begs the
Speaker 1: question about what comes next, because as we're recording this,
Speaker 1: the next round of stimulus is stuck in political gridlock. Right.
Speaker 1: We are recording this h December Wednesday, December sixt or
Speaker 1: some headlines this morning that they might be UM close
Speaker 1: to a deal, so by the time people are listening,
Speaker 1: we'll probably know. Also there is an fo of C
Speaker 1: decision today, So again we're having this conversation prior air
Speaker 1: to that, you know, in the context of the sort
Speaker 1: of surprising recovery and how it's not like the GFC aftermath.
Speaker 1: I think one of the first clues or one of
Speaker 1: the first people who helped me really understand the difference
Speaker 1: was our guest. Today. We're gonna be speaking with h
Speaker 1: Jan Hats Here's the chief economist at Goldman Sachs or
Speaker 1: role he's occupied since and it was a note of
Speaker 1: his I think sometime in April making what at the
Speaker 1: time was I thought a pretty extraordinary call, which is
Speaker 1: that he thought, um, thanks to the Cares Act and
Speaker 1: fiscal stimulus, that household income would actually be up in
Speaker 1: which is not what you expect to see when the
Speaker 1: unemployment rate is spiking. And to me that was like
Speaker 1: one of the first times I saw someone like really
Speaker 1: crystallized this idea that this is going to be a
Speaker 1: different year that the two thousand and eight two thousand
Speaker 1: nine playbook cannot really apply to this kind of a crisis. Yeah,
Speaker 1: I agree, and a lot of people follow hatsis work,
Speaker 1: and I do think some of what he's written about
Speaker 1: recently kind of gets to the heart of the big
Speaker 1: question going into which is how is the consumer going
Speaker 1: to react? What's consumer confidence going to look like? Are
Speaker 1: we going to get this pent up demands scenario where
Speaker 1: once we get a vaccine and the lockdown gets rolled back,
Speaker 1: everyone goes out and spends and makes up for lost
Speaker 1: time by going to bars and restaurants and things like that.
Speaker 1: Or are we going to see sub sort of permanent
Speaker 1: damage to consumer confidence after the events of Absolutely well,
Speaker 1: I'm I can't think of a better guest to talk
Speaker 1: about to finish up this extraordinary year in the economy
Speaker 1: and look ahead to next year. Then, So, Jan, thank
Speaker 1: you very much for joining us. Thank you for having me.
Speaker 1: You guys are being too kind, So so tell us
Speaker 1: about the crash the crisis from your perspective. Hey, did
Speaker 1: you also get some of those two thousand eight, two
Speaker 1: thousand nine flashbacks and how quickly did you realize that
Speaker 1: that playbook would not apply to Well, we certainly got
Speaker 1: some flashbacks in in March. Given the sort of lack
Speaker 1: of normal functioning and a number of of financial markets,
Speaker 1: especially the bond markets. I mean, there was a there
Speaker 1: were a lot of comparisons, and there were a lot
Speaker 1: of people that thought, actually, if anything, this looks worse
Speaker 1: than than than two thousand and eight, and all that
Speaker 1: may have been in the in the heat of the moment.
Speaker 1: While you're going through it, of course, it always looks worse.
Speaker 1: But there were definitely some very very unsettled weeks when
Speaker 1: there was a lot of concern about about market functioning.
Speaker 1: I don't think there was ever the same kind of
Speaker 1: concern about the financial system, So I think that was
Speaker 1: a difference. Even even going through I think there was
Speaker 1: a generally greater degree of confidence that financial institutions were,
Speaker 1: you know, in much better shape, partly because of the
Speaker 1: regulatory response that we saw after the two thousand and
Speaker 1: eight crisis. But but in terms of market functioning, I
Speaker 1: think there were there were clearly some some flashbacks. I
Speaker 1: think it was also clear, you know, taking a somewhat
Speaker 1: broader view and not just looking at what happened in
Speaker 1: the bond markets, that the economic backdrop was quite different
Speaker 1: the down turn. It became clear, you know, very quickly
Speaker 1: in in early March was probably going to be significantly
Speaker 1: bigger than what you had in two thousand and eight,
Speaker 1: just in terms of the decline in GDP in the
Speaker 1: second quarter and the you know, the drop was driven
Speaker 1: by very different fact It wasn't driven by financial factors,
Speaker 1: you know, ability to pay or or or asset values,
Speaker 1: but it was really driven by a physical constraint on
Speaker 1: on economic activity. So, I mean, there there were some similarities,
Speaker 1: but I also think that it became pretty clear that
Speaker 1: the economic environment was you know, it was just a
Speaker 1: very very different shock, and I had to be really
Speaker 1: analyzed I think, in its in its own right, and
Speaker 1: not not really through the lens not too much through
Speaker 1: the lens of two thousand and eight. MM. So Joe
Speaker 1: mentioned your April note where you sort of identified some
Speaker 1: of the differences between the crisis versus the two thousand
Speaker 1: eight crisis. Uh More recently, I believe you have a
Speaker 1: pretty out of consensus call on economic growth for versus
Speaker 1: the rest of the street. What are you seeing that
Speaker 1: other people aren't seeing at the moment? And also back
Speaker 1: in April, I think it goes back to the previous question.
Speaker 1: I do think that it's A, it's a very different cycle.
Speaker 1: So that's that's really the main answer. I think it's
Speaker 1: a it's a very different cycle. It was really driven
Speaker 1: by a health emergency that forced us to shut down
Speaker 1: parts of the economy. Uh And it wasn't driven by
Speaker 1: you know, a bursting asset bubble and a credit crisis
Speaker 1: that that you know, might have taken and did take
Speaker 1: years to unwind after the two thousand eight prices and
Speaker 1: through a degree to a much milder degree, even after
Speaker 1: the two thousand and one recession and after recession, those
Speaker 1: were all driven by really financial factors and financial imbalances
Speaker 1: that that to a long time to unwind. This was
Speaker 1: driven by uh A, you know, just very very different factors.
Speaker 1: You know. I think policy plays a very important role
Speaker 1: as well. As we discussed the policy response by both
Speaker 1: monetary and fiscal policy was so much more aggressive this time.
Speaker 1: And my favorite statistic in in terms of how that
Speaker 1: sort of looks in the economic data is the fact
Speaker 1: that the second quarter of two thousand twenty saw the
Speaker 1: biggest decline ever in GDP and the biggest increase ever
Speaker 1: in real disposible income. And most of these things are correlated.
Speaker 1: When one is down the other style as well, and
Speaker 1: vice versa. In this case they were they not only
Speaker 1: went in opposite directions, but but in both cases to
Speaker 1: a to a record degree. And I think that really
Speaker 1: speaks to the enormously aggressive h policy response that we
Speaker 1: saw in the US and in a number of other
Speaker 1: countries as well. So, as mentioned in the intro, when
Speaker 1: we're recording this, we don't actually know, um, what's going
Speaker 1: to happen with whether there be an additional round of
Speaker 1: fiscal stimulus or not. But you know, one thing that
Speaker 1: we do know is that at least on the aggregate
Speaker 1: basis right now, household balance sheets, um, they look very healthy.
Speaker 1: People have a lot of cash, they have a lot
Speaker 1: of savings, um, and so forth. So look ahead, you know,
Speaker 1: let's say like we're having this conversation again in December,
Speaker 1: and presumably by then we've had a successful rollout of
Speaker 1: the vaccine and the economy is fully reopened. Knock on wood,
Speaker 1: How significant is the prospect of fiscal stimulus or how
Speaker 1: different does the economy look in December, whether we get
Speaker 1: this extra jolt of fiscal stimulus in the meantime to
Speaker 1: get us through from now until reopening. I think From
Speaker 1: that perspective, it's not clear how how big the difference
Speaker 1: is going to be between a situation where we get
Speaker 1: near term stimulus and a situation where we don't. I
Speaker 1: do think that in the shorter term, as far as
Speaker 1: you know, the remainder of two thousand and twenty and
Speaker 1: first quarter and maybe second quarter of two thousand and
Speaker 1: twenty one is concerned, it's going to make a significant difference.
Speaker 1: There is a still a strong case, I think, for
Speaker 1: providing additional support to the economy because in the in
Speaker 1: the short term, despite the fact that the vaccine is
Speaker 1: likely to help a lot and bring the economy back
Speaker 1: to normal um to a large extent in two thousand
Speaker 1: twenty one, in the short term, virus cases continue to
Speaker 1: be extremely high, and the economy is still, you know,
Speaker 1: far away from from full employment despite the progress that
Speaker 1: that we've made. So I think there is temporary weakness
Speaker 1: that I think it's very amenable to to to policy support,
Speaker 1: and there's a there's a strong case, especially if it's
Speaker 1: you know, temporary amount of weakness, is a strong case
Speaker 1: for using both monetary and especially fiscal policy to relieve
Speaker 1: the hardship that is being h that's being caused by
Speaker 1: by this, by this neotrom neotrom Don John. Of course,
Speaker 1: monitory and fiscal policy aren't aren't the right tools to
Speaker 1: address the health emergency itself, but they can maically reduce
Speaker 1: the fallout in terms of jobs and incomes and knock
Speaker 1: on effects to other sectors of the economy. M so.
Speaker 1: On that note, I have a related question, but how
Speaker 1: much I mean, we've seen financial conditions loosen quite significantly
Speaker 1: in the aftermath of everything that's happened in March. How
Speaker 1: much to easier financial conditions offset the damage to the
Speaker 1: real economy. Well, easier financial conditions certainly help in supporting
Speaker 1: accurate demand. I mean the point of our financial Conditions Index,
Speaker 1: which is currently at its easiest level on record, and
Speaker 1: we have this back to the early nineties. The point
Speaker 1: of the financial conditions index is to measure how the
Speaker 1: channels of monetary transmission, you know, on the yields, equity prices,
Speaker 1: credit spreads, currency, how they are affecting the real economy.
Speaker 1: And if you're at a very easy level and you've
Speaker 1: seen a sizeable easing in terms of rates of change,
Speaker 1: then you're you're getting a positive impulse to uh to
Speaker 1: do the economy from that um and so that's certainly helping.
Speaker 1: But at the same time we are well below for
Speaker 1: employment and inflation is well below the FEDS target, so
Speaker 1: you know, more supportive the economy is. Still that's still helpful.
Speaker 1: And I would say also that on the fiscal side,
Speaker 1: of course, if you provide income support to those people
Speaker 1: in the economy are most aren't hit by the weakness.
Speaker 1: I mean that they generally don't benefit from easy financial conditions,
Speaker 1: that they might get an indirect benefit, but directly if
Speaker 1: financial conditions are easy, that doesn't replace income directly, so
Speaker 1: that's still a job for fiscal policy. Were you surprised
Speaker 1: speaking of not replacing income directly? I mean, we're having
Speaker 1: this debate now about stimulus, but we've had a long
Speaker 1: gap and the expanded unemployment insurance that was established under
Speaker 1: the Cares Act in late March that ran out I
Speaker 1: think at the end of July, so we've had this
Speaker 1: long gap of sort of a bit of a removal
Speaker 1: of fiscal support. Have you been Were you surprised in
Speaker 1: a sort of late summer the fall that there was
Speaker 1: not a more pronounced ramification from the end of that
Speaker 1: extra expanded aid to the unemployed. Yeah, we were a
Speaker 1: little surprised by that. We would have thought that we'd
Speaker 1: get a clearer signal or clearer signs of deterioration when
Speaker 1: we look at some of the micro data on spending
Speaker 1: by unemployed and employed people we did. We do find
Speaker 1: some very clear effects of the expiration of the of
Speaker 1: the six hundred dollar check checks, and then we see
Speaker 1: a sort of temporary increase in spending by the by
Speaker 1: the unemployed, again on the back of the executive orders
Speaker 1: that that partially replaced this um the six hundred dollars,
Speaker 1: but only for a temporary period, So that that shows
Speaker 1: up pretty clearly in the in the data. But it
Speaker 1: uh the levels are generally higher than you might have
Speaker 1: then you might have expected the potals of spending by
Speaker 1: by the unemployed. So I think it's it probably only
Speaker 1: shows you that the initial amount of income support, both
Speaker 1: from the unemployment benefits and from the tax rebates was
Speaker 1: large enough to provide a bit of a cushion and
Speaker 1: you know, boost spending. Who's the level of spending for
Speaker 1: a period of time. So it's probably still being boosted
Speaker 1: to some degree by the by the earlier stimulus. But
Speaker 1: that's obviously not going to last forever, and there are
Speaker 1: some signs, including in the in the November retail sales
Speaker 1: report released this morning, that that was maybe maybe running
Speaker 1: out at this point. Mm hmm. So this is something
Speaker 1: that I'm really curious about. But how much did stimulus
Speaker 1: sort of muddy the outlook the future outlook for for
Speaker 1: consumers and consumer confidence? And also how are you thinking
Speaker 1: about the consumer going into because as I mentioned, there
Speaker 1: is this debate at the moment. Are the unusual events
Speaker 1: of this year going to encourage people to, you know,
Speaker 1: permanently cut back on spending and raise their savings because
Speaker 1: they're more uncertain and they're worried that an unexpected event
Speaker 1: like a global pandemic could come out of nowhere and
Speaker 1: they might use their jobs and things like that. Or
Speaker 1: are we going to see this big rebound in consumer
Speaker 1: spending the pent up demand theory as the vaccine gets
Speaker 1: ruled out and lockdown gets ruled back. I think you've
Speaker 1: laid out well the two sort of extremes in that
Speaker 1: in that discussion. I'm more on the on the side
Speaker 1: of the second rather than the first. I don't think
Speaker 1: that there's going to be a permanent impact I think,
Speaker 1: you know, people are going to go My expectation would
Speaker 1: be people are going to go back to spending money
Speaker 1: on on on similar types of service activities and service
Speaker 1: experiences that they will spending money on before. You obviously
Speaker 1: always subject to their own economic situation and a bunch
Speaker 1: of other factors. But I don't think that there's going
Speaker 1: to be a large amount of behavior or scarring h
Speaker 1: if you get into an environment where the risk of
Speaker 1: getting infected is much lower or the consequences of being
Speaker 1: in fact that are much lower, and I think there
Speaker 1: could be some degree of pent up demand for services.
Speaker 1: I think that's more uncertain whether whether you are going
Speaker 1: to see say demand for travel and and and entertainment
Speaker 1: actually move above the previous day in the pre pandemic
Speaker 1: baseline for a while. I think it's harder to know.
Speaker 1: It wouldn't be, you know, behaviorally, it wouldn't be true
Speaker 1: surprising that if you haven't been able to do any
Speaker 1: of these things, you might do, uh, you know, you
Speaker 1: might go to an extra concert or do a do
Speaker 1: an extra trip. But for me, the main thing would
Speaker 1: be that these are still sectors of the economy that
Speaker 1: that operating far below normal and I think when we
Speaker 1: have a vaccine, and when the vaccine has led to
Speaker 1: you know, effectively heard immunity, you know, whenever that is
Speaker 1: sometimes in two thousand and twenty one, I think we'll
Speaker 1: we'll see a return to normal levels for these parts
Speaker 1: of the economy, and that that is going to give
Speaker 1: you a boost to the level of GDP by you know,
Speaker 1: maybe two percent or so if you take it an aggregate.
Speaker 1: Obviously much bigger increases in all specific sectors. So I
Speaker 1: wanna shift the conversation a little bit because besides the
Speaker 1: sort of immediate what we're seeing in the economy, you know,
Speaker 1: Tracy and I always like to talk about economic ideas
Speaker 1: and how those evolved. You have been a long time.
Speaker 1: I don't know. You just sort of take you look
Speaker 1: at the economy through what's known as a sectoral balances framework,
Speaker 1: which is associated with the economist Wind Godly, who has
Speaker 1: been an influence on your work. Um, I'm curious if
Speaker 1: you can sort of give us our listeners, like a
Speaker 1: brief description of what this is and how that helps
Speaker 1: you look at the economy, and then like how that's
Speaker 1: helped you understand the economy in and looking ahead. What
Speaker 1: the framework talks about because I do think it's sort
Speaker 1: of a it's a different way of thinking about the
Speaker 1: economy than certainly I would say most Wall Street economists. Yeah,
Speaker 1: it's it's basically a focus on especially the private sector
Speaker 1: financial balance, which is just the difference between the total
Speaker 1: income and total spending of all households and businesses. And
Speaker 1: you could disaggregate households and businesses, but I often find
Speaker 1: it more useful to look at together because in some
Speaker 1: cases there it's difficult to distinguish between where the household
Speaker 1: sector ends and where the business sector begins. If you think,
Speaker 1: for example, of of small businesses and an entrepreneurs. So
Speaker 1: if you if you aggregate up the the entire private sector,
Speaker 1: and private sector runs a financial deficit that happens, you know,
Speaker 1: often on the back of large asset price increases or
Speaker 1: asset price bubbles, for example in the late stock market
Speaker 1: bubble or the two thousand's housing market bubble. That means
Speaker 1: that the private sector is quite vulnerable too. You know
Speaker 1: that that developments in asset markets or other shocks, because
Speaker 1: they are already spending beyond the current level of income
Speaker 1: and having to finance the difference with net debt accumulation
Speaker 1: and can continue as long as asset markets are are
Speaker 1: performing well. But if asset markets start to turn down,
Speaker 1: households and farms need to cut their spending relative to
Speaker 1: the income. That generates a negative impulse to aggreate demand
Speaker 1: and often results in a in a recession. And we
Speaker 1: saw this pretty clearly in the US in not only
Speaker 1: the two thousand eight prices but also in the two
Speaker 1: thousand and one recession, and frankly, we've seen it time
Speaker 1: and time again in in in other advanced economies in
Speaker 1: the last two or three decades, in you know, Europe,
Speaker 1: in the in the run up to the to the
Speaker 1: two thousand eight crisis, Spain as an extreme example. We've
Speaker 1: seen similar things in in the UK in the early
Speaker 1: ninety nineties and a bunch of other economies. So this
Speaker 1: is something that I'm quite focused on as a warning
Speaker 1: sign of financial imbalances and vulnerability of the of the
Speaker 1: real economy. And basically, households and firms living beyond their means,
Speaker 1: or at least beyond the short term means is is
Speaker 1: a dangerous sign and one of the things in two
Speaker 1: thousand and twenty and especially in the two thousand in
Speaker 1: the in the spring lockdowns in the second quarter that
Speaker 1: was very, very different from those past episodes was that
Speaker 1: the private sector was actually running a huge financial surplus,
Speaker 1: and much of a surplus than you'd ever seen before
Speaker 1: in in post war history. And you know, well, that's
Speaker 1: not the only thing that matters for the for the
Speaker 1: economic artwork was certainly one thing that gave us confidence
Speaker 1: in calling for a pretty rapid recovery from the sort
Speaker 1: of margin April lows. So I do think it had
Speaker 1: a big impact on our on our thinking in two
Speaker 1: thousand and twenty, And of course it was very related
Speaker 1: to the policy decisions that we just talked about, the
Speaker 1: decision to provide substantial amounts of transfers to the alsalts
Speaker 1: that should up in the private financial as well. Right, So,
Speaker 1: I mean, on a related note, since we're talking about
Speaker 1: financial imbalances. On the one hand, the policy response did
Speaker 1: help enormously in stabilizing markets and in providing a cushion
Speaker 1: for consumers, as we've been discussing. But now with stocks
Speaker 1: sort of all time highs and with you know, the
Speaker 1: corporate bond market booming, and lots of other weird things
Speaker 1: happening in capital markets like SPACs and and big I
Speaker 1: p O booms and things like that. Do you see
Speaker 1: an issue of financial instability looming or do you worry
Speaker 1: about moral hazard at all? I don't see I would
Speaker 1: say imminent signs of financial imbalances that are that that
Speaker 1: are relevant for for monitor that they need to be addressed,
Speaker 1: let's say, by by monetary policy. I don't. I don't
Speaker 1: see that. UM. I mean, of course you should never
Speaker 1: say never. It's always something that that I think central
Speaker 1: banks and policymakers have monitor. But again, if I go
Speaker 1: back to the private sector of financial balanced as you know,
Speaker 1: one metric of financial imbalances, the private sector is still
Speaker 1: running a very large surplus. Past kind of asset price
Speaker 1: bus that that that have had really negative effects on
Speaker 1: the on the real economy have typically been preceded by
Speaker 1: large private sector UH deficits where you know, households and
Speaker 1: farms were effectively spending too much relative to the income
Speaker 1: flaw on the back of very rapid debt accumulation, and
Speaker 1: so these increases and asset prices had much more tangible
Speaker 1: effects on you know, people's borrowing spending behavior. I'm not
Speaker 1: seeing that. UM. You know, that doesn't mean of course
Speaker 1: that there there couldn't be any any imbalances, and there
Speaker 1: certainly doesn't mean that they couldn't be price the clients
Speaker 1: in in different markets. But I do think that it
Speaker 1: tells you probably that the vulnerability of the real economy
Speaker 1: to these kinds of adjustments is probably lower than it
Speaker 1: would have been in many of these other episodes. That's
Speaker 1: that's where that would be my starting point, and it's
Speaker 1: I think similar in spirit at least two the reviews
Speaker 1: that the Federal Reserve undertakes kind of regularly where they
Speaker 1: look at valuations, and you know, valuations of different types
Speaker 1: of assets. That's one important input. And then they also
Speaker 1: look at economic behavior and spending and borrowing behavior uh
Speaker 1: and and leverage in the in the economy and in
Speaker 1: the financial system, and both of those are important for
Speaker 1: whether they I think the risks are elevated right now.
Speaker 1: You could probably make an argument in a number of
Speaker 1: areas that valuations are becoming more ambitious or maybe you
Speaker 1: you ratchet up your level of concern and somewhat there.
Speaker 1: But if you if you look at the behavior of
Speaker 1: the borrowing, leverage in the in the system, and you're
Speaker 1: talking about the private sector here, I don't think there
Speaker 1: are really any signs of that would make you really worried.
Speaker 1: So Tracy always used to make fun of me, but
Speaker 1: she hasn't lately, and now I feel kind of bad.
Speaker 1: But she always used to make fun of me for
Speaker 1: always asking a modern monetary theory question on our interviews.
Speaker 1: But I'm not going to do that yet. But I
Speaker 1: might get to that in a second. But but I
Speaker 1: have kind of got a hint at that, which is
Speaker 1: what's interesting to me listening to you describe this framework,
Speaker 1: is that the vulnerabilities are really on the private sector
Speaker 1: balance sheets. And so you look back at two thousand,
Speaker 1: everybody he thought, oh, there's this amazing boom, the economy
Speaker 1: is great, the federal government is even running a surplus.
Speaker 1: But your framework identified warning signs because the private sector
Speaker 1: was actually um running into deficit at the time, and
Speaker 1: then we did indeed have a crash not long thereafter.
Speaker 1: Do you see more and more people appreciating this, I mean,
Speaker 1: we're still in the media people always like to talk
Speaker 1: about the size of the national debt and the deficit,
Speaker 1: But do you see a greater appreciation of this sort
Speaker 1: of inversion of that, or the concern is really on
Speaker 1: the private sector's debt and deficit as opposed to the
Speaker 1: public sector. One do. Yeah, I think there has been
Speaker 1: has been a shift in emphasis, and certainly the experience
Speaker 1: of the you know, both the two thousand and eight
Speaker 1: crisis and the aftermath of that and this this year,
Speaker 1: I think it's contributed to that. It's been it's become
Speaker 1: a thing pretty clear that large government deficits, especially if
Speaker 1: they occur in response to temporary, uh, you know, temporary downturns,
Speaker 1: large contemporary downturns in in in aggregate demand, that those
Speaker 1: are typically not not nearly as dangerous as I think
Speaker 1: many people would have said before the two thousand and
Speaker 1: eight crisis. And I think this year has made that
Speaker 1: even clearer because the policy response was that much more
Speaker 1: more aggressive. You know. I think on the on the
Speaker 1: private sector side, I think you will find a reasonable
Speaker 1: number of people who have been concerned about private sector
Speaker 1: and balances for a long time and has surprise and
Speaker 1: balances for for a long time. And yeah, we're trying
Speaker 1: to persuade people that that the private sector financial balance
Speaker 1: is a is a useful metric of that. You know,
Speaker 1: I would say there hasn't been a break school on
Speaker 1: that particular on that particular metric, But we'll certainly continue
Speaker 1: to talk about it because I think it's a it's
Speaker 1: a nice summary of, you know, imbalances that that people
Speaker 1: might otherwise look at in a more kind of piece
Speaker 1: of neal fashion. But I think that's the big continuous
Speaker 1: So I'm going to leave the MMT question to Joe,
Speaker 1: because I know he does want to ask them. But
Speaker 1: I want to ask a different sort of big picture
Speaker 1: economics question, which is you wrote quite a lot about
Speaker 1: the productivity puzzle, where the productivity mystery over um the
Speaker 1: past ten years or so, this is the idea that
Speaker 1: productivity growth has been really surprisingly sluggish, and there are
Speaker 1: lots of different theories about why that might be. I'm
Speaker 1: curious whether the experience of and the experience of having
Speaker 1: different parts of the economy effectively shut off has informed
Speaker 1: your opinion on on what's driving that product activity puzzle
Speaker 1: at all. Have you learned anything about productivity this year
Speaker 1: we have I have a lot of questions about productivity.
Speaker 1: I'm not sure that we've had full answers yet in
Speaker 1: you know, in terms of what we've seen in two
Speaker 1: thousand and twenty, what's certainly striking is that productivity has
Speaker 1: done really well in two thousand and twenty. So if
Speaker 1: you just look at the numbers, you know, we've seen
Speaker 1: very strong productivity growth through the through the year. Now,
Speaker 1: part of that is because the sectors of the economy
Speaker 1: that are still very disrupted are generally low productivity sectors
Speaker 1: like restaurants and UH and and you know personal services
Speaker 1: that where productivity value added for work of our work
Speaker 1: tends to be lower. So there's a composition effect in
Speaker 1: the in these data. But it seems like even if
Speaker 1: you just for that composition effect, or you look at
Speaker 1: the numbers on a on on an industry by industry basis,
Speaker 1: you you've still seen a pretty significant increase in productivity.
Speaker 1: And the question I think is is that temporary or
Speaker 1: permanent it might hint at a better period for measured
Speaker 1: productivity growth than what we what we've had in the
Speaker 1: kind of three two thousand and twenty, you know, ten
Speaker 1: or fifteen years. So that's a that's a very intriguing question.
Speaker 1: But you know whether perhaps in this in this terrible pandemic,
Speaker 1: we we actually have found some ways of increasing productivity
Speaker 1: UH that you know, will will prove to be a
Speaker 1: permanent benefit. You know, for example, if you if you
Speaker 1: think about the changes in in retail from breaking mortar
Speaker 1: stores to online retail, that certainly be something that boosts
Speaker 1: productivity over the longer term. Obviously there are disruptions associated
Speaker 1: with that, but it is something that I am I
Speaker 1: am very interested in. It doesn't the two thousand twenty
Speaker 1: prices doesn't really tell you anything about the key thing
Speaker 1: that I was focused on for the last several years,
Speaker 1: which was how much of the weakness and measure productivity
Speaker 1: growth reflects measurement era as opposed to a true slowt on.
Speaker 1: I do think that there is a very good case
Speaker 1: we made that we have gotten worse at measuring productivity growth.
Speaker 1: There's a big debate about this, but but it does
Speaker 1: seem to me that the economy is becoming harder and
Speaker 1: harder to measure as we move away from producing homogeneous
Speaker 1: goods like that that are easily countered in terms of
Speaker 1: tons tons of steel and and bushels of wheat towards
Speaker 1: you know, services and virtual goods that are that are
Speaker 1: very difficult to measure and where it's very difficult to
Speaker 1: estimate prices, and where it's therefore hard to follow the
Speaker 1: sort of national income accounting playbook of counting up receipts
Speaker 1: and then applying a price index in order to get
Speaker 1: a real output measure, and then dividing that by hours
Speaker 1: work to get a productivity measure. You know, there there
Speaker 1: are a number of areas or steps in that calculation
Speaker 1: where you end up having having great difficulty measuring. So
Speaker 1: I don't think two thousand twenties has really shed any
Speaker 1: additional light on that, but I still think it's an
Speaker 1: important issue. Well, speaking of productivity, I mean, I know
Speaker 1: one theory I've heard people put forward is that low
Speaker 1: productivity is in part of function of low overall demand
Speaker 1: under employment, companies not feeling a big urge to invest
Speaker 1: when overall demand is strong, companies not feel in a
Speaker 1: big urge to invest in new technology when labor is plentiful.
Speaker 1: How much, in your view, could just sort of pure
Speaker 1: demand side aspects of the economy play in productivity and
Speaker 1: then beyond that, you know, one of the lessons learned
Speaker 1: I think from is that simply giving checks two unemployed
Speaker 1: people or lower income people as an incredibly powerful form
Speaker 1: of stimulus. So I'm curious, like what your view is
Speaker 1: on just sort of pure demand side policies overall as
Speaker 1: both the key to the productivity puzzle, but also just
Speaker 1: going forward in terms of a focus of how that
Speaker 1: can sort of make the economy more robust and get
Speaker 1: us out of downturns quicker. Yeah, I mean, I totally
Speaker 1: agree on the on the last, the second part of
Speaker 1: that question that if you're in a slump, finding direct
Speaker 1: ways of boosting area of demand is is a very
Speaker 1: sensible kind of policy endeavor, and I think we we
Speaker 1: took a very direct and policymakers took a very direct
Speaker 1: approach in in two thousand and in twenty and it
Speaker 1: has worked very well. You know, obviously was still going
Speaker 1: through it, but I would say the early returns are
Speaker 1: quite positive. Now, this was a particularly particularly obvious policy
Speaker 1: in this downturn, because he had this huge shock to
Speaker 1: economic activity. But at the same time, it was pretty
Speaker 1: clear that it was temporary. Obviously, back in March and
Speaker 1: April you didn't know how quickly we would have a vaccine,
Speaker 1: and it now looks even more clearly temporary than it
Speaker 1: did back then. But even back then it was very
Speaker 1: clear that it was temporary. So in that sort of environment,
Speaker 1: the case for stabilization policies. You know, aggressive demand side
Speaker 1: stabilization policies is very very strong, and I think, um,
Speaker 1: you know, well, it is a good lesson to to
Speaker 1: take away, even though not every downturn that will have
Speaker 1: in the future it's going to be quite as clear
Speaker 1: cut as as this one. On the on the impact
Speaker 1: on productivity, I'm less sure. I mean, I think there
Speaker 1: are certainly some cyclical effects on productivity through labor utilization
Speaker 1: and you know, labor hoarding or or or shake out
Speaker 1: of employment. So I do think you always want to
Speaker 1: try to adjust your productivity measures for utilization, and there
Speaker 1: are some estimates that that that do that. San Francisco
Speaker 1: FED provides some some of that adjustment. For example, typically
Speaker 1: the once you average over somewhat longer bread though that
Speaker 1: you always have to do with productivity numbers you never
Speaker 1: really want to look at quarterly. I think once you
Speaker 1: do that, typically you find that the the cyclical effects
Speaker 1: are not enormous, and they can go on both directions.
Speaker 1: It's not always the case that a stronger economy also
Speaker 1: means higher productivity of a faster productivity growth. In fact,
Speaker 1: you know often you find that late in a business
Speaker 1: cycle when you're already very close to full employment firms
Speaker 1: basically after resort to hiring the molest productivity workers and
Speaker 1: you know, which is good good in terms of employment outcomes,
Speaker 1: but may not be so great for measure of pordativity growth.
Speaker 1: Um So, so I think the case for you know,
Speaker 1: demand side policies to stabilize the economy in the slump
Speaker 1: is strong, but doesn't primarily rest on the productivities board.
Speaker 1: So you mentioned the vaccine briefly then, and of course
Speaker 1: the successful rollout of the vaccine factors into your v
Speaker 1: shaped economic forecast for but I'm curious how that actually
Speaker 1: impacts your outlook more inflation, and we haven't touched on
Speaker 1: that specifically, But if we were to see economic growth
Speaker 1: come rowing back, and if we were to see an
Speaker 1: uptick in spending, would you expect that to translate into
Speaker 1: price increases of one sort or another. Yeah, Over over time,
Speaker 1: I think you will see higher inflation in a in
Speaker 1: a stronger activity environment. So if you're you put more
Speaker 1: pressure on on on the labor market, you feel what's
Speaker 1: still quite a large gap in the labor utilization, I
Speaker 1: think you're going to see upward pressure on wages and
Speaker 1: you know, ultimately also upward pressure on price inflation. I
Speaker 1: mean these effects, you know, Philip Phillips curve effects. You
Speaker 1: you can stroll them in the in the data. You
Speaker 1: see it for for wages, you see it for prices,
Speaker 1: and statistically they're they're definitely there. They're just not very
Speaker 1: strong and uh, the size of the impact is not
Speaker 1: not very large. And so you need quite a lot
Speaker 1: of strength in real activity and quite a lot of
Speaker 1: pressure on labor markets to get these kinds of increases
Speaker 1: in which which growth and price inflation. So by our estimates,
Speaker 1: and you know, we have an optimistic view on growth
Speaker 1: where at five point three percent for for US GDP
Speaker 1: in two thousand and twenty one, But even with that,
Speaker 1: we only get to two for pc inflation on the
Speaker 1: sustained basis in two thousand and twenty four, and then
Speaker 1: not also shortly thereafter we have to first hike in
Speaker 1: the in the fund's rate. And so that's that's all
Speaker 1: working working assumption. So obviously, I mean, over the last
Speaker 1: forty years, we've just seen this incredible um you know, disinflation.
Speaker 1: Even when we get an up cycle in prices, the
Speaker 1: pace of inflation tends to be lower than the previous peak.
Speaker 1: You don't see it picking up any time soon. Do
Speaker 1: you have in your mind a cogent theory for why
Speaker 1: we've seen this multi decade disinflation and what policy shifts
Speaker 1: or what any kind of shifts might actually reverse that
Speaker 1: on a sustained basis, I would I would disagree with
Speaker 1: you slightly on the down trend, at least in the US.
Speaker 1: I mean, I think what we've had is basically a
Speaker 1: low inflation environment since the mid nineties, where you've had
Speaker 1: a kind of one and a half to two percent
Speaker 1: for the for the most part. If you take the
Speaker 1: core PC index and the peak inflation rate at the
Speaker 1: end of the cycle was you know, about two percent
Speaker 1: little uh, you know, a little of then it was
Speaker 1: a bit higher than that at the end of the
Speaker 1: subsequent cycle. This time again we only got to do
Speaker 1: about two percent. But it's it's basically been in that
Speaker 1: in that sort of range. Now, why has it been
Speaker 1: Why has it been so low relative to prior cycles?
Speaker 1: I think basically because the Vulker and early Greenspan bed were,
Speaker 1: you know, very adamant that they wanted to bring down inflation.
Speaker 1: From the nineteen seventies and early nineteen eighties levels, and
Speaker 1: they they wanted to stabilize inflation expectations at a at
Speaker 1: a low level of you know, maybe two percent, but
Speaker 1: they want particular really concerned if it ended up being
Speaker 1: somewhat lower than two percent. You know, they used to
Speaker 1: be the so called comfort zone that beneficials talked about,
Speaker 1: which was one to two percent for the PC and next,
Speaker 1: so you know, effectively, I think they got what they
Speaker 1: what they wanted, and then over time in recent years,
Speaker 1: I think the FED and any macroeconomists have thought, well,
Speaker 1: what we wanted at the time is probably a little
Speaker 1: bit low because the neutral interest rate is the real
Speaker 1: interest rate is significantly lower than it was before. And
Speaker 1: if we only have average inflation of one to two percent,
Speaker 1: but we we may have two little room to respond
Speaker 1: to cut rates and ease policy in response to the slump.
Speaker 1: So we want to make sure that you know, we
Speaker 1: at least average two percent rather than average one and
Speaker 1: a half percent, to give ourselves a little bit more room.
Speaker 1: And I think that's that's the thinking behind the framework
Speaker 1: review that we got from the FED. This uh, this
Speaker 1: summer was full of surprises, and I don't think a
Speaker 1: lot of people had a global pandemic necessarily on on
Speaker 1: their their list of major risks to their economic outlooks
Speaker 1: going into the year. But I'm curious for you what
Speaker 1: was the biggest surprise of the year other than the
Speaker 1: pandemic itself. Yes, like in terms of in terms of
Speaker 1: the economy, the way it reacted to the pandemic, or
Speaker 1: in terms of lessons learned. Well, we we saw a
Speaker 1: pandemic that initially maybe didn't look so different from some
Speaker 1: of the other scares about pandemics and and other pandemics
Speaker 1: that we've seen in previous years, you know, h one
Speaker 1: h one n one um. And I think the fact
Speaker 1: that we had seen a number of scares like this
Speaker 1: with out really large economic effects, at least in the
Speaker 1: in the US, that that added to the surprise of
Speaker 1: just how devastating this pandemic was in terms of the
Speaker 1: impact on the on the economy. Back in January, some
Speaker 1: of the early reports certainly looked scary, and I think
Speaker 1: they looked looked concerning to a lot of a lot
Speaker 1: of economists. But we also all remember that we've we've
Speaker 1: heard some of these warnings before, and in the end,
Speaker 1: at least the economic impact it didn't turn out to
Speaker 1: be that large. So, you know, I do think that's
Speaker 1: a that is a large surprise. I think the other
Speaker 1: thing that that's been remarkable. We've talked a lot about
Speaker 1: the demand side of the economy, but I think on
Speaker 1: the supply side of the economy is you know, how
Speaker 1: adaptable the many structures in the economy really are. If
Speaker 1: you look at, for example, the shift from you know,
Speaker 1: brick and more the retail to online retail. You look
Speaker 1: at the level of US retail sales that we very
Speaker 1: quickly got back to the pre crisis level, even though
Speaker 1: the mode of delivering the goods have have changed dramatically.
Speaker 1: I think the fact that working from home, you know,
Speaker 1: for all its problems and all its disruption in terms
Speaker 1: of individual lives, ultimately you know, worked quite well in
Speaker 1: terms of maintaining output and maintaining productivity and a lot
Speaker 1: of a lot of sectors. I think that's been impressive.
Speaker 1: So so yeah, I mean, I think there there are
Speaker 1: quite a number of surprises, but the but the biggest
Speaker 1: one I think continues to be the pandemic itself. Just
Speaker 1: going back a second, I wanted to clarify one thing
Speaker 1: on inflation. Do you see the FEDS new framework, the
Speaker 1: average Inflation Targeting framework, as being a meaningful change going forward.
Speaker 1: Is this is this regime change or is it a
Speaker 1: slight technical tweak that ultimately won't matter much? And do
Speaker 1: you think what are these sort of knock on effects
Speaker 1: if they adear by this approach of essentially not snuffing
Speaker 1: out inflation too soon and actually trying to get into
Speaker 1: average around two percent rather than a two ceiling. It's
Speaker 1: a good question. I mean, I think you could say
Speaker 1: it's a very significant change because you apply the same
Speaker 1: framework to the prior cycle and you probably would have
Speaker 1: gotten quite a bit less interest rate UH increases. Then
Speaker 1: then then you ended up getting probably UH wouldn't have
Speaker 1: gotten a hike in in two thousand and fifteen, and
Speaker 1: only a much smaller number of hikes than just nine hikes.
Speaker 1: But subsequently, so I do think that there was a UH,
Speaker 1: there's been a signific can change from that perspective. On
Speaker 1: the other hand, I don't think that they're going to
Speaker 1: be willing to tolerate much higher inflation than than they
Speaker 1: did in the previous regime. I mean, I do think
Speaker 1: it's a it's sort of a fifty basis point kind
Speaker 1: of shift, and you you had one and a half
Speaker 1: percent on average from one point six percent on average
Speaker 1: in the twenty years before the regime shift. I think
Speaker 1: we'll be at two percent or so. I don't think
Speaker 1: the average is going to drift higher to two and
Speaker 1: a half percent or or two or three percent UM.
Speaker 1: So from that perspective, I don't think the implications are
Speaker 1: so at allmos So. I guess the short run impact
Speaker 1: on any individual cycle, especially any backcast of an individual cycle,
Speaker 1: for for monetary policy, those changes could look pretty significant.
Speaker 1: But in the long term, I don't think the massive
Speaker 1: reteam You know, you are a sort of adherent of
Speaker 1: the work of Win Godly, whose sectoral balances framework which
Speaker 1: we talked about, is sort of one of the pillars
Speaker 1: I guess you could say, of the MMT view of
Speaker 1: the economy. And sometimes there are articles about m m
Speaker 1: T and you're often cited as a sympathist, one of
Speaker 1: the sympathists on Wall Street. So I'm curious like your
Speaker 1: take on this sort of framework and whether you think
Speaker 1: it sort of pushes us in the right direction in
Speaker 1: terms of understanding the economy and um policy responses, Like
Speaker 1: what your view on it is Yeah. I try to
Speaker 1: be sort of eclectic in terms of what, you know,
Speaker 1: what we find useful. And I do think that when
Speaker 1: you're in a slump, you know, often aggressive stimulus too,
Speaker 1: you know, in order to combat that slump, both from
Speaker 1: the monetary and the and the fiscal side, and less
Speaker 1: worry about government deficits in the in the short term.
Speaker 1: I think that's that's often the right policy response. And
Speaker 1: I think that is uh, you know, from that perspective,
Speaker 1: maybe maybe related to the m m T prescriptions. I
Speaker 1: also think though that when you're you know, when you're
Speaker 1: in a strong economy, back to full employment and in
Speaker 1: the center banks inflation target, that the policy prescription has
Speaker 1: changed pretty pretty significantly. While I certainly agree that a
Speaker 1: government can't you know, technically go go bankrupt, you know,
Speaker 1: the central bank buys buys the debt, I think the
Speaker 1: right policy prescriptions in in the full employment economy are
Speaker 1: going to look quite different from the MMT prescription. So
Speaker 1: in my view, it really depends on the on the
Speaker 1: situation you're in, and then I would say on the
Speaker 1: private sector financial balance and the sector of balance as approach,
Speaker 1: I do find that quite useful in a number of respects,
Speaker 1: but I wouldn't necessarily put any particular label on all go.
Speaker 1: I'm always very happy to give wind godly credit for
Speaker 1: pushing the strength so much and directing our attention to
Speaker 1: it in the in the past. All right, well, yeah,
Speaker 1: thank you so much for joining us. A real treat
Speaker 1: and pleasure to get so much of your time and
Speaker 1: looking forward to uh reading further your work and see
Speaker 1: what store. Thank you so much, Joan, Thank you, Tracy.
Speaker 1: That was great. Yeah, and thank you so much, Tracy.
Speaker 1: I always like talking to Jan. I was like reading
Speaker 1: Jan and like I said, it really was him more
Speaker 1: than anyone else who're back in the spring. His identification
Speaker 1: of the power of sort of filth replacing lost income
Speaker 1: and how big of a deal that would be. That
Speaker 1: sort of helped me see that's like this is not
Speaker 1: exactly going to be like two thousand and eight. Two yeah. Um,
Speaker 1: And let me just add I'm so glad that we
Speaker 1: can round out the year with talking about sectoral balances
Speaker 1: and the wind Gollic framework. Excellent to do that. That's
Speaker 1: that's that's facetious. Now. I'm very happy for you, Joe
Speaker 1: that you made that happen. Um, But just going back
Speaker 1: to the hatsies his framework of the crisis. Like, I
Speaker 1: do think he's absolutely right that this crisis is incredibly
Speaker 1: unusual and we haven't really seen anything like it in
Speaker 1: Uh well, I guess all of sort of financial market history. Um.
Speaker 1: But in many ways it's this government induced crisis because
Speaker 1: the lockdowns are being mandated by public health authorities, and
Speaker 1: in many ways it's also a government solved crisis, possibly
Speaker 1: precisely because of that. So we've seen the FED come
Speaker 1: in and politicians in d C come in and offer
Speaker 1: either monetary easing or some sort of fiscal stimulus, and
Speaker 1: so far it has had a fairly enormous effect. And
Speaker 1: that's had I guess that's had the consequence of compressing
Speaker 1: the entire recession into a much shorter cycle than it
Speaker 1: would be otherwise, and certainly a much shorter cycle than
Speaker 1: what we saw in two thousand eight. It's very controversiary.
Speaker 1: You said this was a government induced crisis. I mean,
Speaker 1: I'm sure the lockdowns have had a significant effect, but
Speaker 1: also the sort of inclination to just avoid getting the
Speaker 1: virus uh also pretty big. Yeah. I mean I think
Speaker 1: you could debate that there, but I would look, I'm
Speaker 1: in Hong Kong, and I'm close to the mainland, and
Speaker 1: I'm close to China, and so maybe that colors some
Speaker 1: of my perspective, But I would say like authorities kind
Speaker 1: of chose to shut down vast suites of the economy,
Speaker 1: certainly in the US. And anyway, let's not get into that.
Speaker 1: Let's talk about the economy and m m T. You
Speaker 1: know what, No, I know. I I do think like
Speaker 1: this sort of question of when are we particularly vulnerable
Speaker 1: is like a huge thing to think about now and
Speaker 1: also the future of being. It is probably the peak
Speaker 1: optimism about just the economy and prosperity and everything seemed
Speaker 1: really good in a way that I don't think we've
Speaker 1: felt um in since then. But that was when the
Speaker 1: private sector started running this deficit and people spending more
Speaker 1: than they earned, in part due to the wealth effect.
Speaker 1: Per ups of the dot com bubble also saw that
Speaker 1: again in two thousand five, two six, I think two
Speaker 1: thousand seven, um at the peak of the housing crash.
Speaker 1: And then you look now and you see, okay, how
Speaker 1: household balance sheets and aggregate were in good shape going
Speaker 1: into the crisis. In aggregate, they actually look better today
Speaker 1: than they did at the start of the year due
Speaker 1: to all the savings and so you know, there is
Speaker 1: a good reason to think that, um, we do have
Speaker 1: this potential cushion of stability that could prove to be
Speaker 1: a real benefit in the coming years. Yeah. And also
Speaker 1: just the idea that household balance sheets look better now
Speaker 1: than they did at the start of I don't think
Speaker 1: anyone would have expected that in March of this year. Um.
Speaker 1: And it just goes to show you how unexpected certain
Speaker 1: economic developments have actually been. Yeah. Absolutely, I mean I
Speaker 1: don't think for all the sort of modeling you can
Speaker 1: do about Okay, if you spend this much money, then
Speaker 1: that replaces this last income and so forth. I don't
Speaker 1: think anyone could really, um, really have it predicted that
Speaker 1: we this is where we'd be in mid December. No,
Speaker 1: and we should definitely have you on back on at
Speaker 1: the end of next year and see how everything panned out.
Speaker 1: I think that would be an interesting conversation. But for now,
Speaker 1: shall we leave it there. Yeah, I like that idea.
Speaker 1: That's an annual December end of year Christmas conversation at
Speaker 1: Christmas time conversation with sounds good. But yeah, let's leave
Speaker 1: it there. Okay, this has been another episode of the
Speaker 1: All Thoughts podcast. I'm Tracy Alloway. You can follow me
Speaker 1: on Twitter at Tracy Alloway and I'm Joe wi Isn't though.
Speaker 1: You could follow me on Twitter at the Stalwart. Follow
Speaker 1: our producer Laura Carlson. She's at Laura and Carlson. Followed
Speaker 1: the Bloomberg head of podcast, Francesca Levi at Francesca Today,
Speaker 1: and check out all of our podcasts under the handle
Speaker 1: at podcasts. Thanks for listening.