WEBVTT - Inflation Data Outlook, Fintech, SALT, Ukraine Latest 0:00:00.800 --> 0:00:04.040 Welcome to the Bloomberg Markets Podcast. I'm Paul Sweeney, alongside 0:00:04.040 --> 0:00:06.920 my co host Matt Miller. Every business day, we bring 0:00:06.960 --> 0:00:11.520 you interviews from CEOs, market pros, and Bloomberg experts, along 0:00:11.520 --> 0:00:15.600 with essential market moving news. Find the Bloomberg Markets Podcast 0:00:15.600 --> 0:00:18.439 on Apple Podcasts or wherever you listen to podcasts, and 0:00:18.480 --> 0:00:21.120 at Bloomberg dot com slash podcast. This week, we're gonna 0:00:21.120 --> 0:00:23.800 get some economic data, particularly some inflation data. We have 0:00:23.880 --> 0:00:28.000 CPI tomorrow, pp I Wednesday, and we also have a 0:00:28.040 --> 0:00:32.479 Federal Reserve which is adamant in fighting inflation. So a 0:00:32.520 --> 0:00:34.879 lot of moving parts here that are gonna play into, uh, 0:00:35.200 --> 0:00:37.240 what we may hear from the Federal Reserve next week. 0:00:37.280 --> 0:00:39.599 And when we talk Federal Reserve and interest rates and policy, 0:00:39.640 --> 0:00:42.639 we need to go to Danielle di Martino, Booth CEO 0:00:42.800 --> 0:00:46.640 and chief strategist for Quill Intelligence, former advisor at the 0:00:46.640 --> 0:00:50.120 Federal Reserve Bank of Dallas. Danielle, thanks so much for 0:00:50.200 --> 0:00:52.559 joining us here. Again, a lot of inflation data we're 0:00:52.560 --> 0:00:54.800 gonna get today. What do you think the Federal Reserve 0:00:54.880 --> 0:00:58.720 is really going to be focusing on? Well, I think 0:00:58.800 --> 0:01:01.560 that they're gonna go ahead and fade what they see 0:01:01.880 --> 0:01:05.120 in in the headline CPI. I think that that has 0:01:05.160 --> 0:01:09.240 been so well broadcast across so many different channels that 0:01:09.280 --> 0:01:11.319 they're gonna be They're gonna really have their eye more 0:01:11.440 --> 0:01:15.520 on the stickiness of the core and whether that is 0:01:15.640 --> 0:01:18.559 as as if as it's expected ticks up to six. 0:01:20.200 --> 0:01:22.920 Um My buddy, Ivy's Elman, who has been a longtime 0:01:23.000 --> 0:01:27.800 veteran of the housing industry. She sees housing shelter both 0:01:27.880 --> 0:01:30.440 O E R and rent. She sees that peaking at 0:01:30.480 --> 0:01:34.960 seven in the fall year over year. Now, that's that 0:01:35.360 --> 0:01:38.000 is that's a good hundred and fifty basis point above 0:01:38.720 --> 0:01:42.600 what it was. Yeah, Ivy's the best. I used to 0:01:42.600 --> 0:01:44.840 work with Ivy back in today on the housing biz. 0:01:45.319 --> 0:01:47.920 Um So if you're the Federal Reserve, I mean, alright, 0:01:47.960 --> 0:01:50.480 seventy five basis points as we get to next week. 0:01:51.000 --> 0:01:53.440 But I guess that's that that's baked in. Is it 0:01:53.520 --> 0:01:56.360 more just kind of the body language we get about 0:01:56.960 --> 0:01:59.639 whether we pause and see if this stuff actually works 0:02:00.080 --> 0:02:04.080 or whether we just keep moving higher. Well, I think 0:02:04.280 --> 0:02:06.480 what we're going to be focused on are the things 0:02:06.520 --> 0:02:09.760 that are less in the Fed's control, and that would 0:02:09.760 --> 0:02:11.840 be what our food price is going to do. I 0:02:11.880 --> 0:02:14.160 was seeing a report on on the terminal last night 0:02:14.240 --> 0:02:18.080 that really really hot, blazing temperatures out west. That's affecting 0:02:18.080 --> 0:02:20.960 how much we're paying for produce um. I think a 0:02:20.960 --> 0:02:22.880 lot of it is going to depend on on how 0:02:22.919 --> 0:02:26.880 sticky rents are. Rents have begun to peek out. But 0:02:27.400 --> 0:02:29.720 even in a shorter LAG world, which I argue and 0:02:29.720 --> 0:02:31.400 I think that's one of the things that people should 0:02:31.400 --> 0:02:34.160 be paying close attention to. The effect of LAG has 0:02:34.200 --> 0:02:39.120 been compressed monetary policies working faster. But that being said, 0:02:39.120 --> 0:02:41.520 if Annie May figures, it figures it takes five quarters 0:02:41.560 --> 0:02:44.840 to see shelter inflation move its way through the c 0:02:45.040 --> 0:02:48.919 p I, we still got high housing inflation for several 0:02:48.919 --> 0:02:53.440 more quarters. So I've got a listener writing in Danielle 0:02:53.480 --> 0:02:56.639 and asks is if we get a five percent print, 0:02:57.160 --> 0:02:59.600 is that high enough to get the Fed to continue 0:02:59.680 --> 0:03:03.480 hikeing into a weakening environment? Or or what what cp 0:03:03.600 --> 0:03:08.079 I print matters in terms of the actual numbers? Well, 0:03:08.120 --> 0:03:11.280 and look, until the job is done, I mean, how 0:03:11.320 --> 0:03:14.720 much more explicit can J Powell be? I don't think. 0:03:14.800 --> 0:03:17.040 I don't think four is going to be acceptable. So 0:03:17.120 --> 0:03:21.079 until we're until we're back headed back down towards two percent, 0:03:21.120 --> 0:03:23.680 which I guess we all interpret as three is headed 0:03:23.720 --> 0:03:26.560 towards two. Right. Yeah, well, I mean that's that's kind 0:03:26.560 --> 0:03:29.280 of what the European Cential Bank alluded to its communications 0:03:29.360 --> 0:03:32.000 last last week, is that three might be the new two. 0:03:32.440 --> 0:03:34.679 And but but in order for us to get there, 0:03:35.200 --> 0:03:37.400 most of the work that's been done shows that you 0:03:37.440 --> 0:03:40.400 have to have an appreciably bigger bump up in your 0:03:40.440 --> 0:03:42.960 unemployment rate. And I think that that's where the focus is, 0:03:43.160 --> 0:03:47.200 and it's it's intriguing that, um that only Layle Brainerd 0:03:47.920 --> 0:03:52.080 so far vice chair has said, you know, there are 0:03:52.200 --> 0:03:55.000 risks if we begin to slow the economy too much. 0:03:55.040 --> 0:03:57.360 You had to pay pretty close attention to what her 0:03:57.400 --> 0:04:00.480 comments were last week, but that's what she said. Otherwise, 0:04:00.520 --> 0:04:03.880 everybody's just a bunch of former dubs who are now 0:04:03.960 --> 0:04:08.080 bowls in China shops. So, Danielle, I mean, aside from 0:04:08.080 --> 0:04:10.680 the fact that we've already had two quarters of negative 0:04:10.680 --> 0:04:15.400 g d P, what is your UH recession outlook and 0:04:15.640 --> 0:04:17.919 maybe what are some of the parameters that kind of 0:04:18.000 --> 0:04:20.240 kick you into recession and maybe keep us out of it, 0:04:20.320 --> 0:04:22.960 or maybe make it deep versus not deep? How do 0:04:23.000 --> 0:04:26.560 you think about that right now? I think about the 0:04:26.560 --> 0:04:29.640 recession in terms of it being long. And what people 0:04:29.640 --> 0:04:32.800 don't appreciate is that the National Bureau of Research Economic 0:04:33.080 --> 0:04:38.000 Economic Research, they they time recessions based on the level 0:04:38.400 --> 0:04:41.679 of GDP. SMP Global came out on Friday. They reduced 0:04:41.680 --> 0:04:44.360 their third quarter GDP as of it two point six 0:04:44.440 --> 0:04:46.880 per cent. I'm getting wonky here, but that means that 0:04:46.920 --> 0:04:50.159 it's not sufficient to offset the negative point eight percent 0:04:50.400 --> 0:04:54.320 they're anticipating we see for the final print for the 0:04:54.400 --> 0:04:58.480 second quarter. What that means is on a level, the 0:04:58.600 --> 0:05:01.400 n b e R could come and surprise investors who 0:05:01.400 --> 0:05:04.200 are like, woo, it's a happy you know, we're seeing 0:05:04.200 --> 0:05:06.080 positive growth. The n b e R could come out 0:05:06.080 --> 0:05:08.039 and say, you know what, we're still in recession and 0:05:08.120 --> 0:05:11.200 surprise people because it gauged off of the level. That's 0:05:11.240 --> 0:05:13.280 what the arbiters, that's how that's how they do it. 0:05:14.279 --> 0:05:16.480 I want to finally ask you about political pressure. How 0:05:16.560 --> 0:05:19.240 much do you think, Danielle, the FED is going to 0:05:19.440 --> 0:05:23.120 feel um if we start to get unemployment at four 0:05:23.160 --> 0:05:25.600 and a half five five and a half percent, or 0:05:25.640 --> 0:05:27.960 I should say, when we start to get unemployment around 0:05:27.960 --> 0:05:34.000 five percent, and how will that affect this independent body. Well, 0:05:34.279 --> 0:05:38.400 I think that the winds will shift violently, um from 0:05:38.760 --> 0:05:42.160 we're concerned about inflation to oh my gosh, our constituents 0:05:42.160 --> 0:05:45.000 are losing their jobs. So it won't take the Beltway 0:05:45.080 --> 0:05:47.760 crowds very long to go from eight point A to 0:05:47.839 --> 0:05:50.240 point B. We saw news out of Goldman that they're 0:05:50.320 --> 0:05:53.799 uh that they're pursuing laughs just this morning. That being said, 0:05:54.680 --> 0:05:58.200 this J. Powell sounds like a different person. And until 0:05:58.360 --> 0:06:01.960 something breaks in credit, and I don't mean just bankruptcies rising, 0:06:01.960 --> 0:06:06.200 our defaults increasing, but until something fundamental breaks that threatened 0:06:06.200 --> 0:06:08.920 systemic risk. I see this J. Powell was pushing forward. 0:06:09.640 --> 0:06:11.440 All right. Danielle, thank you so much for joining us 0:06:11.440 --> 0:06:14.440 once again. We always appreciate getting your perspective. Danielle d 0:06:14.520 --> 0:06:18.880 Martino Booth. She's the CEO and chief strategists at Quill Intelligence, 0:06:19.160 --> 0:06:21.159 and she's a former advisor to the Federal Reserve Bank 0:06:21.839 --> 0:06:23.839 of Dallas. And she brings up that Goldman Sacks news. 0:06:23.839 --> 0:06:26.360 Goldman Sacks prepares for layoffs as soon as next week. 0:06:26.520 --> 0:06:30.440 That's according to the New York Times. Let's check up 0:06:30.440 --> 0:06:32.560 with our next guest, David dts And managing Principal and 0:06:32.600 --> 0:06:38.040 senior portfolio strategist at Peacock Private Wealth Management based in Summit, 0:06:38.160 --> 0:06:40.320 New Jersey. David, thanks so much for joining us here. 0:06:40.360 --> 0:06:43.280 We're gonna get a bunch of inflation data UH this 0:06:43.320 --> 0:06:45.360 week with CPI and p p I, and we know 0:06:45.440 --> 0:06:48.800 our Federal Reserve is paying attention to that. How are 0:06:48.800 --> 0:06:50.240 you going to parse some of this data we're gonna 0:06:50.279 --> 0:06:53.760 get this week? So absolutely, I think that's the number 0:06:53.800 --> 0:06:58.160 one issue is where is inflation uh in America today? 0:06:58.279 --> 0:07:02.080 And of course last month we saw that headline inflation 0:07:02.240 --> 0:07:05.160 was flat. Uh, it still gave us an eight point 0:07:05.200 --> 0:07:09.960 one percent year over year, which is far too high, 0:07:10.160 --> 0:07:12.360 worse than like forty years, and the feder over Service 0:07:12.600 --> 0:07:15.600 is reacting. But remember investors are always looking forward, and 0:07:15.760 --> 0:07:19.320 what we're thinking we're gonna get come tuesday is actual 0:07:19.600 --> 0:07:22.400 actually a dip about ten basis points in the therems 0:07:22.400 --> 0:07:25.679 of headline inflation as we're gonna see softer gasoline prices 0:07:25.680 --> 0:07:28.960 at the pump, some softening and rent with the strong dollar, 0:07:29.520 --> 0:07:32.640 um export prices are coming down to and so that 0:07:32.680 --> 0:07:36.200 will help the narrative that perhaps for past peak inflation 0:07:36.480 --> 0:07:39.240 and things are going to start easy. So what does 0:07:39.280 --> 0:07:41.600 that mean for stocks? Does that mean the S and 0:07:41.680 --> 0:07:44.440 p UM continues this rally that we've seen the past 0:07:44.440 --> 0:07:48.200 few sessions. Yeah, it's a great question, very hard to 0:07:48.200 --> 0:07:51.720 make a short term call. I think the the skeptic 0:07:51.760 --> 0:07:54.280 would say, hey, you know, we've been buying. You know, 0:07:54.280 --> 0:07:56.840 we're at four point one percent since last Tuesday. We've 0:07:56.840 --> 0:07:59.480 been buying on anticipation that this is gonna be a 0:07:59.520 --> 0:08:02.720 better print. And there could be what we say, you know, 0:08:02.960 --> 0:08:05.200 buying the rumor and then selling the news, and people 0:08:05.360 --> 0:08:07.640 take some profits if it just comes in as as 0:08:07.720 --> 0:08:10.960 I mentioned. Having said that, of course it could be 0:08:10.960 --> 0:08:13.920 a little bit better softer inflation, or that could give 0:08:14.120 --> 0:08:18.920 investors greater confidence to continue to push prices higher. That 0:08:18.920 --> 0:08:21.840 wouldn't be surprising, because you know, we're down eight on 0:08:21.880 --> 0:08:25.400 the SMP five since the high point in January. We 0:08:25.480 --> 0:08:28.560 still should seek positive corporate earnings for Q three up 0:08:28.600 --> 0:08:33.720 nearly four percent. We've got strong employment, the consumers continues 0:08:33.760 --> 0:08:38.079 to spend very resilient UM, so the reasons to be upbeat. 0:08:38.240 --> 0:08:41.120 David Cratty Gupta brought up something at the top of 0:08:41.160 --> 0:08:43.600 the program which I thought was really interesting. She said 0:08:43.679 --> 0:08:46.760 that the gains that Ukraine is making in the war 0:08:47.280 --> 0:08:52.559 against Russia, are UM allowing the dollar to kind of 0:08:52.640 --> 0:08:54.960 let some of the pressure out, and the Bloomberg Dollar 0:08:55.040 --> 0:08:58.480 index is down against UM. You know, the euro is gaining, 0:08:58.520 --> 0:09:01.880 the Pound is gaining. You think a positive turnaround for 0:09:02.000 --> 0:09:04.840 Ukraine in this war, a positive outlook would be good 0:09:04.840 --> 0:09:09.599 for stocks as well. Yeah, absolutely certainly. You know, the 0:09:11.080 --> 0:09:13.920 concern of cources with any kind of you just don't 0:09:13.960 --> 0:09:17.600 know where that geopolitical situation is going UM. And the 0:09:17.679 --> 0:09:21.840 recent good news, well we already see now European natural 0:09:21.840 --> 0:09:27.480 gas prices are UM now at a one month low UM, 0:09:27.559 --> 0:09:30.199 the euros starting to gain a little bit of momentum, 0:09:30.280 --> 0:09:33.079 the dollars down three percent from where it was last week. 0:09:33.679 --> 0:09:37.400 That certainly can take the pressure off global inflation. That 0:09:37.559 --> 0:09:41.600 certainly can give investors confidence. Is obviously too early to 0:09:41.640 --> 0:09:43.520 say we're out of the woods. I don't think Putin's 0:09:43.559 --> 0:09:46.160 gonna go down without a fight, but the news is 0:09:46.280 --> 0:09:49.080 good and I think that could provide a tail win 0:09:49.160 --> 0:09:51.840 for stocks going forward. Here I'll just say that I 0:09:51.960 --> 0:09:55.400 do see t t F natural gas down almost eight 0:09:55.440 --> 0:09:58.880 percent just today and UK natural gas down six and 0:09:58.880 --> 0:10:01.520 a half percent just today, So one month low, and 0:10:01.600 --> 0:10:04.320 when we're going lower here on the exact crisis exactly. 0:10:04.320 --> 0:10:06.720 And hey, how about the bond yields, David, I mean, 0:10:06.920 --> 0:10:08.080 you know, if I want to put my money in 0:10:08.080 --> 0:10:10.240 a ten year bond, I'm getting three point three percent. 0:10:10.800 --> 0:10:12.880 That's nothing to sneeze at. Him. That's actually a kind 0:10:12.880 --> 0:10:17.200 of a return. Well, it is, and it isn't. Certainly 0:10:17.400 --> 0:10:19.160 it's a lot better return than at the start of 0:10:19.160 --> 0:10:20.960 the year. Has been one of the worst years on 0:10:22.320 --> 0:10:25.880 UH in history, for for for bond investors. But you know, 0:10:25.920 --> 0:10:28.600 the fact of the matter is with the headline inflation 0:10:28.720 --> 0:10:30.880 last month was eight point one percent year over year, 0:10:31.120 --> 0:10:33.600 three point three percent is kind of something to steeze at. 0:10:33.960 --> 0:10:37.320 And of course, and of course when you look at history, 0:10:37.440 --> 0:10:39.960 three point three percent is not that great. You know, 0:10:40.040 --> 0:10:45.319 you've got the the earnings yield on the SMP about seventeen, 0:10:45.400 --> 0:10:47.079 which is going to give you what five and a 0:10:47.120 --> 0:10:49.040 half percent, So I'll take five and a a half percent 0:10:49.080 --> 0:10:52.360 over three point three percent. I think most retireason I 0:10:52.400 --> 0:10:55.040 worked with they can't live on three point three percent 0:10:55.120 --> 0:10:57.240 for the next ten years. Yeah, but you're happy to 0:10:57.280 --> 0:11:00.520 get any kind of return, especially relative to other bonds. 0:11:00.720 --> 0:11:02.680 Um but do you think we're going to see the 0:11:02.679 --> 0:11:05.400 tenure yield go up or was three and a half 0:11:05.440 --> 0:11:10.280 percent the peak? It's harder to call the bond market 0:11:10.320 --> 0:11:12.720 it is the stock market, you know. It all really 0:11:12.720 --> 0:11:15.840 depends on inflation. If inflation does get out of control, 0:11:15.920 --> 0:11:19.840 if the geopolitical developments worse in um, you're gonna see 0:11:20.080 --> 0:11:24.120 bond investors running for the hills. Bond investors hate inflation if, 0:11:24.160 --> 0:11:27.040 on the other hand, recession concerns come back. Although the 0:11:27.080 --> 0:11:31.200 equity market hates recession, bond investors love it because that 0:11:31.280 --> 0:11:33.760 brings down the inflation. So we're gonna have to see. 0:11:34.000 --> 0:11:35.880 At this point, I still think it's a good deal 0:11:35.920 --> 0:11:39.240 for investors to be in stock drilled to to three 0:11:39.240 --> 0:11:43.120 point on the tenure. I hate inflation too, Yeah, who doesn't. 0:11:43.280 --> 0:11:45.880 I hate it more than you do. Well, you say 0:11:45.920 --> 0:11:48.720 you're fine with a two percent target? Yeah, I like 0:11:48.920 --> 0:11:52.440 zero percents. Not realistic. David Deed's managing principle and senior 0:11:52.440 --> 0:11:56.320 portfolio strategist at Peacock Private Wealth Management. He got his 0:11:56.520 --> 0:11:59.480 undergraded Dartmouth way back in the day, and I'm dating 0:11:59.559 --> 0:12:02.360 Mr d uh and his law degree from Universe Chicago. 0:12:02.400 --> 0:12:08.400 That's not bad. That's a nice combo for sure. Combo. Now, 0:12:08.440 --> 0:12:11.040 folks in our listeners, I am holding a load of 0:12:11.120 --> 0:12:13.600 cash in my hand because that's what I do as 0:12:13.760 --> 0:12:16.400 all street guy, that's what we always does. We came up, 0:12:16.440 --> 0:12:19.320 we had wads of cash. But I am increasingly the 0:12:19.400 --> 0:12:23.240 exception to that rule because everything's going digital now on 0:12:23.280 --> 0:12:25.720 the payment side, and I have to bed over the pandemic. 0:12:25.920 --> 0:12:30.040 I'm doing a lot more stuff of financially uh digitally, 0:12:30.240 --> 0:12:32.120 you know. So it says nobody wanted to touch your 0:12:32.120 --> 0:12:35.920 dirty cash. Exactly take exactly, yeah, exactly. Jeff Sloan he's 0:12:35.920 --> 0:12:37.679 at the point of all this. He's the CEO of 0:12:37.720 --> 0:12:40.720 Global Payments. Global Payments is in New York Stock Exchange 0:12:40.720 --> 0:12:43.040 traded company GPN is a symbol you type into your 0:12:43.080 --> 0:12:45.960 Bloomberg Professional terminal like a market cap at thirty eight 0:12:46.000 --> 0:12:48.000 billion dollars. I mean, these guys aren't small. They're based 0:12:48.000 --> 0:12:51.679 down in Atlanta, Georgia employees. Jeff, thanks so much for 0:12:51.760 --> 0:12:54.440 being on our Bloomberg Interactor Broker Studio. Talk to us 0:12:54.480 --> 0:12:57.360 about your business, Global Payments, over the last two and 0:12:57.400 --> 0:13:01.120 a half years of this pandemic. How is your business evolved? Well, 0:13:01.160 --> 0:13:02.600 I think you touched on with what you said with 0:13:02.640 --> 0:13:05.880 your dirty cash example. The first trend coming out of 0:13:05.880 --> 0:13:09.720 the pandemic is really increased digitization. So for many decades 0:13:10.080 --> 0:13:12.520 here in the United States and globally, people have moved 0:13:12.559 --> 0:13:15.079 away from cash and check toward digital, but the pandemic 0:13:15.160 --> 0:13:17.960 really brought that forward by three to five years. Great 0:13:17.960 --> 0:13:20.079 example this is in our business. We do a lot 0:13:20.080 --> 0:13:22.600 of real estate payments. So it used to be you'd 0:13:22.600 --> 0:13:24.440 write out of check to your landlord for the rent. 0:13:24.440 --> 0:13:26.360 You'd walk down to the office or mail it. If 0:13:26.360 --> 0:13:28.400 something was broken, you'd fill out of a form. In 0:13:28.440 --> 0:13:30.840 the pandemic, no one want to touch a pen, a pencil, 0:13:31.040 --> 0:13:32.920 a check. So what you do now is you go 0:13:32.960 --> 0:13:35.640 on your phone, you click pay with your thumb your face, 0:13:35.920 --> 0:13:38.080 You pay the account you know from your bank account, 0:13:38.280 --> 0:13:39.720 and if something is broken and we want to pull 0:13:39.800 --> 0:13:41.640 up your car, you type in the valet thing and 0:13:41.640 --> 0:13:43.439 they put your car around the front. No one touches 0:13:43.440 --> 0:13:45.440 paper anymore. It's a great example of what we've seen. 0:13:45.720 --> 0:13:50.440 So um I've been since I've moved back to the US, 0:13:50.760 --> 0:13:53.880 missing the ability that I had in Germany to do 0:13:53.920 --> 0:13:56.760 that because it's much easier they're used to making payments 0:13:56.880 --> 0:14:02.840 UM digitally. Uh, how do you work with this market? 0:14:02.880 --> 0:14:04.880 And I know you're active in those markets as well 0:14:05.200 --> 0:14:08.200 in terms of avoiding fraud, because if you use Venmo 0:14:08.480 --> 0:14:12.320 or zell or crypto UM, it's impossible to reverse those 0:14:12.400 --> 0:14:15.720 those payments. That's a great question. So um Uh listen, 0:14:15.760 --> 0:14:18.080 we're a technology company. We have six thousand people doing 0:14:18.120 --> 0:14:20.920 nothing but building software all day and actually most of 0:14:20.920 --> 0:14:23.480 the major banks in North America and Western Europe use 0:14:23.560 --> 0:14:27.080 our fraud prevention screens. So we're constantly scanning UM these 0:14:27.120 --> 0:14:29.680 transactions to make sure they're good. We're looking for nominalies 0:14:29.720 --> 0:14:32.000 and kicking them out. But beyond that, if you step back, 0:14:32.040 --> 0:14:35.040 every country is really different. The US is primarily a 0:14:35.240 --> 0:14:38.120 credit and debit card, but increasingly kind of credit in 0:14:38.160 --> 0:14:41.160 the current environment, and they're very active fraud protections, both 0:14:41.160 --> 0:14:43.680 as a regulatory and also as a legal matter for 0:14:43.840 --> 0:14:45.800 use of those cards. So not only are we scanning 0:14:46.120 --> 0:14:49.840 for those anomalies, but the banking regulators, legislators, they're doing 0:14:49.840 --> 0:14:51.880 all the same thing. And I would say by and large, 0:14:51.880 --> 0:14:55.440 consumers are protected UM in those markets from fraud. The 0:14:55.520 --> 0:15:00.800 easiest uh, the ways to transfer money are also fairly expensive. 0:15:00.800 --> 0:15:03.960 I mean PayPal, for example, UM takes a pretty big cut. 0:15:04.200 --> 0:15:07.920 How do you keep costs down? So the United States, interestingly, 0:15:08.120 --> 0:15:10.400 the Federal Reserve came out last week with a movement 0:15:10.400 --> 0:15:13.480 towards what's called FED now or real time payments account 0:15:13.480 --> 0:15:15.400 to account transfers, which we saw in Europe as you 0:15:15.480 --> 0:15:18.520 described a number of years ago. UM. I think if 0:15:18.560 --> 0:15:21.960 you have a Federal Reserve UM and a regulatory sponsored 0:15:21.960 --> 0:15:24.880 intervention in the markets where you can provide for faster, 0:15:25.040 --> 0:15:27.840 more reliable payments in a way that's auditable, UM, that 0:15:27.880 --> 0:15:30.560 avoids the type of fraud that you're referencing, that's nothing 0:15:30.640 --> 0:15:33.960 but good news for merchants, for consumers, and really for 0:15:34.000 --> 0:15:37.320 global payments. Were in the business of moving money digitally. 0:15:37.560 --> 0:15:39.680 If you want your money faster now, I actually have 0:15:39.720 --> 0:15:41.960 to borrow to provide that to you. I'm not gonna 0:15:42.000 --> 0:15:44.840 have to do that. In the Brave New World, we 0:15:44.920 --> 0:15:47.960 hear a lot more are a lot, most recently about 0:15:47.960 --> 0:15:50.480 buy now, pay later. What does that mean to you? 0:15:50.680 --> 0:15:53.960 By now pay later, and how does that impact your business? 0:15:54.440 --> 0:15:56.280 So by now pay later, or I like to call 0:15:56.280 --> 0:16:02.400 as layaway moway, I'm obviously revealing my age right by saying, 0:16:02.400 --> 0:16:04.240 because I'm obviously not a gen z Er, by saying, 0:16:04.240 --> 0:16:06.080 back in the day, you go to service merchandise, you 0:16:06.120 --> 0:16:08.440 said I want this bicycle, and you put a hundred 0:16:08.480 --> 0:16:09.960 dollars a month or whatever until you get it. But 0:16:10.040 --> 0:16:12.160 of course this is you get the thing first. So 0:16:12.200 --> 0:16:14.720 it's more like a credit card, really, isn't it. In's debt. Yeah, 0:16:14.720 --> 0:16:17.040 that's right, that's exactly right. And what I think people 0:16:17.040 --> 0:16:19.120 are worried about here is what we call debt stacking, 0:16:19.520 --> 0:16:22.880 which is taking out multiple bmp L applications and no 0:16:22.920 --> 0:16:25.080 one knows that you have a big pile of debt 0:16:25.560 --> 0:16:27.960 open here doing something else. But to answer your question, um, 0:16:27.960 --> 0:16:30.600 really it's not any different than installment lending. So what 0:16:30.640 --> 0:16:33.000 we're doing is doing it on a very responsible basis, 0:16:33.040 --> 0:16:35.200 meaning we don't balance sheet that's not our decision. That's 0:16:35.240 --> 0:16:39.040 a decision that traditional financial institutions make from an underwriting 0:16:39.520 --> 0:16:41.520 UH and know your customer point of view, and we 0:16:41.560 --> 0:16:43.800 do it through the regulated banking system. So we're working 0:16:43.840 --> 0:16:46.960 with a number of financial institutions that West, for example 0:16:47.040 --> 0:16:49.080 in the United Kingdom, as well as Barclays, as well 0:16:49.120 --> 0:16:51.800 as number of retailers where it's an adjunct to your 0:16:51.840 --> 0:16:55.480 bank hard lending. So those banks know you because you 0:16:55.520 --> 0:16:57.800 have an account there, They know your credit profile, they 0:16:57.800 --> 0:17:00.320 know that you have outstanding Um. I would say the 0:17:00.320 --> 0:17:02.200 bnp O guys have done a really good job in 0:17:02.240 --> 0:17:05.359 technology and bringing innovation to the point of sales. You 0:17:05.440 --> 0:17:07.640 go on a website, it's pinging you. Do you want 0:17:07.640 --> 0:17:10.440 to buy this? I'll give you five percent off, picking 0:17:10.520 --> 0:17:13.160 you now while you're shopping, paying you when you're checking out, 0:17:13.560 --> 0:17:16.400 packing you after we brought that kind of technology traditional 0:17:16.440 --> 0:17:21.119 regulated institutions, which is much safer for everybody. How what 0:17:21.160 --> 0:17:23.280 does the competition look like? Because, as Paul said, you're 0:17:23.280 --> 0:17:27.320 a huge business, but a lot of businesses and payments 0:17:27.359 --> 0:17:29.080 are huge. This is kind of one of the most 0:17:29.080 --> 0:17:33.800 popular Wall Street darlings, I guess really globally. So who 0:17:33.840 --> 0:17:36.160 are you going up against? Well, really varies by market, 0:17:36.160 --> 0:17:38.240 and our business has always been highly competitive. I don't 0:17:38.240 --> 0:17:41.000 expect that to change the word technology company. We simply 0:17:41.040 --> 0:17:43.640 build better software and more markets and do a better 0:17:43.680 --> 0:17:46.520 job selling it. That's really, build better software than Klarna, 0:17:46.640 --> 0:17:51.719 than Adin, than a firm, etcetera. Right, that's exactly right. 0:17:51.800 --> 0:17:53.000 How do you how do you get an edge? On 0:17:53.040 --> 0:17:54.560 those guys. Sure. So I think one of the things 0:17:54.600 --> 0:17:56.200 that we're really good at is listening to the market, 0:17:56.240 --> 0:17:58.639 listening what we're hearing from our customers and where they're going. 0:17:58.680 --> 0:18:01.080 Let me give you a great example, so pre Pandemic, 0:18:01.160 --> 0:18:03.760 we do a lot of quick service restaurant um point 0:18:03.800 --> 0:18:06.920 of sale devices as well as online. So pre Pandemic 0:18:06.960 --> 0:18:09.560 we did twenty million remote orders in the United States 0:18:09.560 --> 0:18:11.960 and nine team, which means you buy your burger king 0:18:11.960 --> 0:18:14.120 Hamburger on your phone, pay with your face, it gets 0:18:14.160 --> 0:18:17.880 delivered through Uber Eats. Last year we did those same 0:18:17.920 --> 0:18:20.520 things true in teledocts. So what we've been able to 0:18:20.520 --> 0:18:23.719 do is really identify trends like remote delivery and bridging 0:18:23.720 --> 0:18:26.600 the physical as well as the virtual world, and we 0:18:26.640 --> 0:18:32.200 compeet by way of vertical markets restaurants, quick service restaurants, retail, healthcare, 0:18:32.320 --> 0:18:35.160 real estate. So while there are plenty of people competing 0:18:35.160 --> 0:18:37.320 in things like e com, the answer to question is 0:18:37.320 --> 0:18:40.320 we're very focused on competing in those vertical markets by 0:18:40.359 --> 0:18:42.679 way of GDP that we think are growing more quickly 0:18:43.119 --> 0:18:46.520 than the average and are also lesser penetrated. Financial news 0:18:46.600 --> 0:18:49.639 websites they do, yes, exactly right, Bloomberg dot com. How 0:18:49.640 --> 0:18:52.080 do you look at crypto Because Matt loves crypto, I 0:18:52.119 --> 0:18:54.600 could care less. Well, I think it's fascinating. I don't 0:18:54.600 --> 0:18:56.440 think it's fair to say I love it. I think 0:18:56.440 --> 0:18:59.960 he's fascinating, the earliest, one of the earliest guys in media. 0:19:00.119 --> 0:19:02.200 You know, I bought bitcoin back when it was six 0:19:02.640 --> 0:19:05.600 dollars and promptly lost my passwords. So I understand the 0:19:05.640 --> 0:19:11.000 benefits and the drawbacks to it, um. But the blockchain 0:19:11.080 --> 0:19:14.000 technology is really the biggest benefit. Right do you do 0:19:14.040 --> 0:19:16.840 you use it? Are you going to? We do? So? 0:19:17.080 --> 0:19:19.439 For example, if you buy crypto and your PayPal wallet 0:19:19.480 --> 0:19:21.560 today and you're training it with somebody else, or you're 0:19:21.640 --> 0:19:24.480 using it, that's actually our technology. UM, that's allowing you 0:19:24.520 --> 0:19:26.399 to buy it, settle it, that kind of thing, and 0:19:26.400 --> 0:19:29.040 we do that globally. That's not just a US comments. 0:19:29.080 --> 0:19:31.399 So I think crypto is a series of use cases. 0:19:31.440 --> 0:19:33.240 Let me tell you first where it doesn't work. So 0:19:33.240 --> 0:19:36.320 there's almost no acceptance at the point of sale, a 0:19:36.400 --> 0:19:39.000 physical or virtual point of sale. And the reason for 0:19:39.040 --> 0:19:42.199 that is there's so much volatility and stable coins in 0:19:42.240 --> 0:19:44.879 blockchain maybe the solution, but for right now, there's so 0:19:44.960 --> 0:19:49.040 much volatility and ethereum or bitcoin and like it's very 0:19:49.040 --> 0:19:50.920 hard to procure at the point of Sale'll think about 0:19:50.920 --> 0:19:53.040 a grocery store. How on earth those guys can take? 0:19:53.520 --> 0:19:55.960 But I would say in the case of use cases, um, 0:19:56.000 --> 0:19:59.240 having loyalty points paid in crypto, having payroll if you like, 0:19:59.280 --> 0:20:01.920 paid in crypto, those are good examples of use cases 0:20:01.920 --> 0:20:03.760 where things work. All right, Jeff, thanks so much for 0:20:03.840 --> 0:20:06.440 joining us. Jeff Sloan, he's the CEO of Global Payments, 0:20:06.640 --> 0:20:09.240 joining us in our Bloomberg Interactive Broker studio. We're gonna 0:20:09.240 --> 0:20:13.480 have more coming up. Got green on the screen where 0:20:13.480 --> 0:20:16.679 you're off our highs, but again still a nice start 0:20:16.720 --> 0:20:19.400 to the week. Let's see what what's going out there 0:20:19.560 --> 0:20:21.879 with pretty Goop to cheese on markets correspond and she 0:20:22.000 --> 0:20:24.280 joins us here in our Bloomberg Interactive Broker studio. Pretty 0:20:24.280 --> 0:20:25.720 what are you looking at? Yeah, well, I wanted to 0:20:25.760 --> 0:20:28.240