WEBVTT - Kocherlakota Sees Labor Market Slack, Calls for Hike Caution 0:00:04.760 --> 0:00:08.080 Welcome to the Bloomberg P and L Podcast. I'm Pim Fox. 0:00:08.119 --> 0:00:11.200 Along with my co host Lisa Abramowitz. Each day we 0:00:11.280 --> 0:00:14.480 bring you the most important, noteworthy, and useful interviews for 0:00:14.520 --> 0:00:16.880 you and your money, whether at the grocery store or 0:00:16.920 --> 0:00:20.680 the trading floor. Find the Bloomberg P L Podcast on iTunes, 0:00:20.840 --> 0:00:29.760 SoundCloud and at Bloomberg dot com. We are broadcasting live 0:00:29.800 --> 0:00:33.720 from the Women for Climate Conference at Columbia University Low 0:00:33.800 --> 0:00:37.120 Library and the City of New York, and we are 0:00:37.200 --> 0:00:40.960 also expecting a press conference scheduled by Federal Reserve Chair 0:00:41.040 --> 0:00:43.879 Janet Yellen following the conclusion of a two day f 0:00:43.960 --> 0:00:47.440 O m C meeting at which it is widely expected 0:00:47.600 --> 0:00:51.080 the Federal Reserve will raise interest rates twenty five basis points. 0:00:51.200 --> 0:00:54.600 Here to tell us more. Nriana Coacha Lakota, Bloomberg View 0:00:54.720 --> 0:00:58.800 Columnists also happens to just be the former president of 0:00:59.000 --> 0:01:04.240 the Minneapolis Federal Reserve. Nrianna Cutchlacarta, thank you very much 0:01:04.240 --> 0:01:07.160 for being with us. I want you to just begin, 0:01:07.280 --> 0:01:10.200 maybe by describing what is it like to sit at 0:01:10.240 --> 0:01:15.960 the table at these meetings, and maybe you can tell 0:01:16.000 --> 0:01:17.560 us if you've ever been to any of them. On 0:01:17.560 --> 0:01:20.720 a virtual basis, like by a video because that's the 0:01:20.760 --> 0:01:22.920 sort of essence of one of your columns that I 0:01:22.959 --> 0:01:25.640 want to bring up. Yeah, no, thanks for having me 0:01:25.680 --> 0:01:30.280 on tim. UM. No. The regular meetings are held in Washington. UM. 0:01:30.600 --> 0:01:34.399 We all sit around a large one of the biggest 0:01:34.400 --> 0:01:36.959 tables you've ever seen in your life, and try to 0:01:36.959 --> 0:01:39.400 hash through the policy and economic issues at the time 0:01:39.480 --> 0:01:43.560 to to get to to get to a good decision. UM. 0:01:44.000 --> 0:01:47.440 People are usually really prepared remarks that they've put together 0:01:47.520 --> 0:01:50.680 with the help of their staffs. UM and UH. But 0:01:50.960 --> 0:01:55.480 I think that is there a specific order. It's that 0:01:55.840 --> 0:01:58.800 the order is usually the chair goes last in the 0:01:59.040 --> 0:02:02.000 two different go hounds that we have. So there's an 0:02:02.040 --> 0:02:04.160 discussion the economy where the chair will go last, and 0:02:04.200 --> 0:02:07.000 then the chair typically goes last the discussion of what's 0:02:07.000 --> 0:02:09.000 going to be done with policy. But other than that, 0:02:09.040 --> 0:02:12.400 it's pretty flexible. People will go in different orders depending 0:02:12.400 --> 0:02:15.280 on where they want to be, and it's the secretary 0:02:15.280 --> 0:02:17.760 of the committee will will hash it out. It's nothing 0:02:17.800 --> 0:02:22.760 really predetermined there. On the video conferences, UM, those are 0:02:22.800 --> 0:02:25.840 hald on a more ad hoc basis. UM. Sometimes on 0:02:26.040 --> 0:02:28.240 for emergencies that come up during the course of the 0:02:28.400 --> 0:02:31.680 between the in the regular scheduled meetings, but sometimes just 0:02:31.680 --> 0:02:35.519 because the committee wants to do a deeper dive into 0:02:35.040 --> 0:02:39.520 two two questions before coming together. And I always found 0:02:39.520 --> 0:02:42.200 those very useful when I was on the committee. UM. 0:02:42.560 --> 0:02:44.440 The thing is, you can't get everyone in Washington on 0:02:44.480 --> 0:02:46.839 a on an ad hoc basis, but so then you'll 0:02:46.880 --> 0:02:51.000 you'll end up doing things by by video conference. You know, Marianna, 0:02:51.160 --> 0:02:55.000 I was noticing that you wrote to us ahead of 0:02:55.000 --> 0:02:57.880 this that you will be against the FED raising rates 0:02:57.880 --> 0:03:03.000 by a quarter of a percentage point. UH today Why yeah, 0:03:03.040 --> 0:03:05.760 So I have a thanks for the question, that's UH. 0:03:05.840 --> 0:03:07.880 I think I have a couple of reasons where I 0:03:07.919 --> 0:03:10.880 would be pretty cautious about raising rates at this time time. 0:03:11.400 --> 0:03:14.840 So one is that I continue to think there's more 0:03:14.960 --> 0:03:17.760 slack and labor markets than UH than I think most 0:03:18.120 --> 0:03:21.280 members of the FOMC do UM. And the reason I 0:03:21.320 --> 0:03:24.280 say that is we've continue to see very strong employment 0:03:24.320 --> 0:03:28.200 growth UM. Most economists think that over the longer run, 0:03:28.240 --> 0:03:31.160 employment growth has to settle down something in the low 0:03:31.280 --> 0:03:37.120 hundreds per months hundred thousand per months as opposed to UM. 0:03:37.360 --> 0:03:42.640 The the the numbers we've been seeing which are really 0:03:42.680 --> 0:03:46.240 closer to two hundreds. And so given that we've seen 0:03:46.280 --> 0:03:50.880 that kind of fast employment growth without seeing high inflationary 0:03:50.880 --> 0:03:54.000 pressures or wage pressures, that's really a strong signal that 0:03:54.040 --> 0:03:56.480 we have still a lot of slack left and labor markets, 0:03:56.520 --> 0:03:59.720 and the the committee should be really uh doing what 0:03:59.760 --> 0:04:03.600 it and to facilitate the that that taking up of 0:04:03.640 --> 0:04:06.240 that flat by the economy. Well, but Marianna, aren't you 0:04:06.240 --> 0:04:10.000 a little bit concerned about these incredible enthusiasm that we've 0:04:10.040 --> 0:04:12.400 seen in stock markets and in junk bond markets and 0:04:13.160 --> 0:04:17.080 other areas that you know, frankly have stemmed from this 0:04:17.160 --> 0:04:19.640 low rate environment. I mean, isn't it the FEDS responsibility 0:04:19.640 --> 0:04:22.680 to try to uh inject some discipline into markets that 0:04:22.720 --> 0:04:26.560 may not otherwise be there. I don't see that. I 0:04:26.600 --> 0:04:29.000 never thought that as a FED. Fed's job. It's not 0:04:29.080 --> 0:04:31.839 the job that's Mandy to buy Congress. The job is 0:04:32.200 --> 0:04:35.479 to promote max employment and promote price stability. Uh. Their 0:04:35.520 --> 0:04:39.919 concerns on the financial side, UM, the Dodd Frankine introduced 0:04:40.400 --> 0:04:43.120 a number of changes in the regulatory system. The FED 0:04:43.240 --> 0:04:47.120 has responsibility those through the Board of Governors. Uh if 0:04:46.720 --> 0:04:50.039 if IF a FETE is worried about financial institutions taking 0:04:50.080 --> 0:04:52.960 on too much risk. They have a number of tools 0:04:52.960 --> 0:04:56.120 that are disposal through through their regulatory function where they 0:04:56.120 --> 0:04:58.680 can can start to start to bring pure pressure to 0:04:58.720 --> 0:05:02.320 bear on those institutions. It's not monetary policy is just 0:05:02.480 --> 0:05:06.200 way too blunt and frankly, just too an effective a 0:05:06.240 --> 0:05:08.039 tool to be used in that kind of kind of 0:05:08.160 --> 0:05:11.600 kind of disciplining device. Can you tell us a little 0:05:11.600 --> 0:05:15.640 bit about the process of selecting new presidents of the 0:05:15.720 --> 0:05:18.760 Board of Governors as well as those that sit on 0:05:18.800 --> 0:05:21.080 the committee, because I believe we're going to get a 0:05:21.080 --> 0:05:24.720 new president in the Atlanta FED, but then the president 0:05:25.200 --> 0:05:30.320 also has some appointments that could reshape the Federal Reserve. Right. 0:05:30.360 --> 0:05:33.520 We just got announced this week that UM there was 0:05:33.560 --> 0:05:35.320 a new president for the Federals of Bank of Atlanta, 0:05:35.400 --> 0:05:39.840 replacing retiring Dennis Lockhart. Raphbaiel Bostic is going to be 0:05:40.040 --> 0:05:43.520 replaced Dennis um And that appointment process is that the 0:05:43.600 --> 0:05:45.880 Board of Directors and the UH subset of the Board 0:05:45.880 --> 0:05:48.960 of Directors, those who are not bankers UH in Atlanta 0:05:49.240 --> 0:05:54.520 UM name appoint Mr Bostic subject to the approval of 0:05:55.080 --> 0:05:59.760 the Board of Governors in Washington and UH I think 0:05:59.839 --> 0:06:03.200 I think it's notable that you know Mr bostick Is, 0:06:03.240 --> 0:06:05.520 I think brings a great range of experiences both in 0:06:05.560 --> 0:06:09.719 the public sector and an academ um, and he is 0:06:09.760 --> 0:06:13.200 the first African American to be a president of a 0:06:13.279 --> 0:06:15.680 reserve bank in the history of the Federal Reserve. So 0:06:15.800 --> 0:06:21.200 I think a lot of good things coming from this disappointment. Nanna, 0:06:21.240 --> 0:06:23.920 I wanted to I was just gonna quickly say about 0:06:24.040 --> 0:06:26.320 the government. The governor appointments I think of as being 0:06:26.560 --> 0:06:30.200 UM potentially much more consequential because the governor's in Washington 0:06:30.279 --> 0:06:33.800 always vote on every EFFEMC decision and they have this 0:06:33.920 --> 0:06:37.719 larger regulatory function I alluded to earlier. UM Governor Trulo 0:06:37.800 --> 0:06:40.200 Dan trula Is announced he's gonna step away from the 0:06:40.240 --> 0:06:43.120 border governors in early April. That means there's gonna be 0:06:43.160 --> 0:06:48.200 three openings for for President Trump to to fill UM, 0:06:48.440 --> 0:06:51.560 probably in short order, and so that could give him 0:06:51.560 --> 0:06:53.440 a lot of It gives him the opportunity have a 0:06:53.480 --> 0:06:57.400 lot of influence over over the border governors. So Nariana 0:06:57.480 --> 0:06:58.960 just to push all that back a little bit about 0:07:00.120 --> 0:07:01.920 idea that it would be a mistake for the Fed 0:07:01.960 --> 0:07:05.520 to hy quarter percentage point and isn't the market sort 0:07:05.560 --> 0:07:09.120 of acceptance of this pricing it in without a big disruption, 0:07:09.760 --> 0:07:13.840 basically a tacit understood the acknowledgement that it's the right 0:07:13.840 --> 0:07:19.440 thing to do. Oh you know, I markets are sometimes 0:07:19.520 --> 0:07:23.880 overly enthusiastic about about economic events, and sometimes they're not 0:07:23.920 --> 0:07:26.560 as enthusiastics as you would like. You don't make monetary 0:07:26.560 --> 0:07:29.080 policy based on what the stock markets doing. I think 0:07:29.120 --> 0:07:32.680 you make monetary policy based on how you see the 0:07:32.720 --> 0:07:37.640 economy evolving. Um, you know, I continue to see that 0:07:37.680 --> 0:07:40.800 there's the opportunity for strong growth in America without having 0:07:41.040 --> 0:07:44.120 inflationary pressures, and and the ft should be doing what 0:07:44.200 --> 0:07:48.720 it can. I think the facilitate that. Um, that's that's uh, 0:07:48.760 --> 0:07:51.520 that's its job is to promote max employment as long 0:07:51.560 --> 0:07:54.320 as that doesn't prove a danger to price stability. Thank 0:07:54.360 --> 0:07:55.760 you so much for joining us. It was really a 0:07:55.760 --> 0:07:58.559 pleasure to speak with you. Marianna Cultural a Quota Bloom 0:07:58.560 --> 0:08:01.800 Review columnist, professor of economics at the University of Rochester, 0:08:01.840 --> 0:08:18.360 and of course, former Minneapolis Fed president. We're broadcasting live 0:08:18.440 --> 0:08:22.040 from the Women for Climate Conference at Columbia University in 0:08:22.120 --> 0:08:24.920 New York City, and I am honored to bring in mural. 0:08:25.160 --> 0:08:28.200 Muriel Bowser. She is the mayor of the District of 0:08:28.280 --> 0:08:32.120 Columbia and she joins us now on the phone. Muriel, 0:08:32.160 --> 0:08:34.880 I'm so happy to speak with you, in particular because Washington, 0:08:34.960 --> 0:08:37.880 d C. Is the first US city to establish a 0:08:37.960 --> 0:08:41.000 green bank and only the second in the world. What 0:08:41.160 --> 0:08:45.360 is a green bank? Well, actually, we're working to get 0:08:45.360 --> 0:08:48.240 it established. This is a piece of legislation that I 0:08:48.280 --> 0:08:53.040 am going to introduce to my council UH in the 0:08:53.240 --> 0:08:56.040 upcoming weeks and as you mentioned, will be the first 0:08:56.120 --> 0:08:58.960 city UH US city to do it, and it will 0:08:59.000 --> 0:09:01.760 be a tool, as we see it, to create green jobs. 0:09:02.040 --> 0:09:05.000 We're going to expand solar power. It will help us 0:09:05.040 --> 0:09:09.319 lower energy costs for the government UH and reduce greenhouse 0:09:09.440 --> 0:09:14.400 gas emissions. It would also help us increase our investments 0:09:14.400 --> 0:09:18.040 in clean energy for for the district. So this is 0:09:18.080 --> 0:09:21.720 a financing tool UM that will allow us to more 0:09:21.840 --> 0:09:26.199 quickly get money out into green infrastructure in our city. 0:09:27.000 --> 0:09:30.640 Mayor Bowser, you're the seventh elected mayor of the district. 0:09:30.840 --> 0:09:34.640 You took office in January of twenty and fifteen. What 0:09:34.760 --> 0:09:37.839 if you could speak to the role of affordable housing 0:09:37.960 --> 0:09:42.840 and its relationship to our conference Women for Climate and 0:09:42.960 --> 0:09:47.719 the Effects of Climate Change. Well, we recognize and I 0:09:47.760 --> 0:09:51.439 was with Mayor Hidalgo in Mexico City recently when C 0:09:51.640 --> 0:09:57.240 forty met, and we so appreciate her global leadership and 0:09:57.280 --> 0:10:01.080 what she has put a focus on is the disproportionate 0:10:01.400 --> 0:10:06.000 impact on love climate change on women around the world 0:10:06.600 --> 0:10:10.800 UH as as it relates to housing and drought and 0:10:11.040 --> 0:10:15.120 all other types of issues. Women of color, women who 0:10:15.200 --> 0:10:19.360 live in poverty are bearing the brunt of drastic changes 0:10:19.960 --> 0:10:23.960 in our climate. In our city, we have focused and 0:10:24.000 --> 0:10:28.560 we have been a leader in sustainability, and we recognize 0:10:28.640 --> 0:10:34.040 that mayors play a critical role when many times, and 0:10:34.080 --> 0:10:36.720 not just in our in our nation, but in others, 0:10:37.320 --> 0:10:40.760 there can be uncertainty at the federal level, but mayors 0:10:40.920 --> 0:10:44.880 have the obligation and the ability uh to make quick 0:10:44.960 --> 0:10:49.400 infrastructure decisions and procurement decisions that collectively, if you put 0:10:49.440 --> 0:10:52.280 all the big city mayorts together, in the small ones too, 0:10:52.640 --> 0:10:56.800 will have the type of American policy that fights climate change. Well, 0:10:56.920 --> 0:10:59.040 Mayor Bowser, you know, you raise a good question, which 0:10:59.160 --> 0:11:01.840 is you know even and if maybe perhaps we hear 0:11:01.880 --> 0:11:04.600 a lot about the federal government rolling back some of 0:11:04.679 --> 0:11:11.280 the environmentally protective regulations that President former President Obama put 0:11:11.320 --> 0:11:13.000 in place, and we hear a lot about how the 0:11:13.000 --> 0:11:15.400 e p A is kind of, uh, perhaps going to 0:11:15.440 --> 0:11:18.800 have a curtailed budget. You're implying that basically it won't 0:11:18.880 --> 0:11:21.679 matter if the mayors of big cities are able to 0:11:21.720 --> 0:11:25.040 implement their own, uh sort of climate change friendly or 0:11:25.040 --> 0:11:28.480 sort of environmentally friendly programs. But is that true? I mean, 0:11:28.600 --> 0:11:31.440 is there some kind of effect from the fact that 0:11:31.440 --> 0:11:34.240 the federal government is cutting the money that they devote 0:11:34.280 --> 0:11:39.600 to reducing greenhouse gases. Yeah, I wouldn't say. I wouldn't 0:11:39.679 --> 0:11:44.160 say that it doesn't matter, um, because we do, for 0:11:44.160 --> 0:11:47.439 for example, in our city, Uh, we we get money 0:11:47.480 --> 0:11:49.920 from the e p A that funds a lots lots 0:11:49.920 --> 0:11:52.960 of grants in our department. UM. But we do have 0:11:53.080 --> 0:11:56.120 the ability to make up the difference. UM. So it's 0:11:56.160 --> 0:12:00.480 not sustainable to think that cities won't ever needs some 0:12:00.600 --> 0:12:05.160 federal support. But we are able to drive innovation invest 0:12:05.240 --> 0:12:09.679 practices that inform um the commitments that the federal government 0:12:09.720 --> 0:12:12.760 is able to make. We are preparing right now to 0:12:12.840 --> 0:12:15.719 stand in the breach, uh, to to make sure that 0:12:15.760 --> 0:12:18.920 cuts in in federal grants to our to Our department, 0:12:19.000 --> 0:12:24.960 for example, are made up mayor bowser. Municipalities tend to 0:12:25.000 --> 0:12:28.599 have their own culture and their own dynamic in a 0:12:28.800 --> 0:12:32.520 variety of areas, whether that's culture or in politics. And 0:12:32.520 --> 0:12:36.160 I'm wondering if you could describe the special situation that 0:12:36.679 --> 0:12:40.720 you're in as the mayor of the district with the 0:12:40.720 --> 0:12:42.880 federal government right there. I'm wondering if you could tell 0:12:42.920 --> 0:12:46.120 us about that relationship and how you believe maybe you 0:12:46.200 --> 0:12:48.880 do that uh it can be improved in change to 0:12:48.880 --> 0:12:52.319 help the people of the district. Uh. Well, we are 0:12:52.400 --> 0:12:56.400 proud of our status as the nation's capital and host 0:12:56.440 --> 0:12:58.960 too many federal government agencies, the White House and the 0:12:59.000 --> 0:13:03.559 Capital included. We're a little different in the federal structure 0:13:03.679 --> 0:13:06.880 and that we operate as a city, accounty, and a 0:13:07.000 --> 0:13:11.080 state all at once. Um. So there are many functions, 0:13:11.120 --> 0:13:13.520 for example, that I have that other mayors don't have 0:13:13.720 --> 0:13:18.920 because we we function as a state, uh in many regards. UH. 0:13:19.200 --> 0:13:22.320 For example, had of meeting just the other day with 0:13:22.440 --> 0:13:25.640 the President where we focused on the federal workforce in 0:13:25.880 --> 0:13:29.000 their implement weather policy. So there's just some kind of 0:13:29.040 --> 0:13:33.360 practical things like that, uh, that that define our relationship 0:13:33.400 --> 0:13:37.360 with the federal government. Uh, special events, people coming to 0:13:37.400 --> 0:13:41.320 the nation's capital to exercise their First Amendment rights or 0:13:41.360 --> 0:13:44.040 other ways. Um that we that we work with the 0:13:44.080 --> 0:13:46.960 federal government. I want to thank you very much for 0:13:47.080 --> 0:13:51.800 joining us. Muriel Bowser, Mayor Bowser the District of Columbia, 0:13:51.840 --> 0:13:55.440 and she can be thank you for covering this special event. 0:13:56.000 --> 0:14:10.480 Thank you at Mayor Bowser. What we're gonna learn this 0:14:10.520 --> 0:14:13.640 afternoon of course, Bloomberg Radio, Bloomberg Television. We'll be covering 0:14:13.640 --> 0:14:18.480 it on Bloomberg dot com. Uh. The press conference following 0:14:19.280 --> 0:14:23.720 the rate decision is reportedly to be one of the 0:14:23.760 --> 0:14:30.080 most important signals of what the Federal Reserves timeline will 0:14:30.120 --> 0:14:33.240 be for when they will raise rates yet again, if 0:14:33.400 --> 0:14:35.840 I guess the world has not fall into well, let's 0:14:36.040 --> 0:14:38.520 let's let's get a sense of what Mark Stefanski is thinking. 0:14:38.640 --> 0:14:41.440 He's chairman and CEO of Third Federal Savings and Loan 0:14:41.600 --> 0:14:46.080 Bank in Cleveland. Mark, what are you hoping the Federal 0:14:46.120 --> 0:14:50.360 Reserve will do today? Well, there's Uh, it's a double 0:14:50.440 --> 0:14:53.560 edged sword because if they do raise the race, that 0:14:53.560 --> 0:14:56.760 that will help all the banks because the interest uh, 0:14:57.240 --> 0:15:00.120 the spreads will be better. Um. So the consider um 0:15:00.480 --> 0:15:02.640 it's not so great. But if you think about things, 0:15:03.320 --> 0:15:06.280 uh in terms of what's happened in the past. You know, 0:15:06.360 --> 0:15:08.840 I grew up in an era where interest rates at 0:15:09.240 --> 0:15:11.680 seven eight nine percent for a mortgage were pretty good, 0:15:12.440 --> 0:15:16.560 and so um, we just moved over We just over 0:15:16.720 --> 0:15:21.120 four for more thirty year fixed rate mortgages exactly, which 0:15:21.120 --> 0:15:23.880 still is pretty good if you compare that over the 0:15:23.960 --> 0:15:27.120 history of the last fifty six years. Even so, it's 0:15:27.160 --> 0:15:30.240 still a good deal for the consumer. But Mark, how concerned, 0:15:30.360 --> 0:15:33.520 argued that the economy is not ready for it, and 0:15:33.640 --> 0:15:36.800 that a not the rate hike I mean, basis points, 0:15:36.800 --> 0:15:39.360 we're talking a quarter of percentage point that's probably priced 0:15:39.400 --> 0:15:42.840 into the market pretty fully throughout the curve. But what 0:15:42.920 --> 0:15:45.360 about you know, sort of what they might suggest afterwards, 0:15:45.360 --> 0:15:47.200 what are you hoping they indicate as far as their 0:15:47.240 --> 0:15:49.840 pace of rate hikes this year and what that could 0:15:49.920 --> 0:15:54.920 do to risk assets. Well, I'm very concerned of a 0:15:55.040 --> 0:15:59.640 fast moving rate hike. Um. I don't think the world 0:15:59.680 --> 0:16:02.120 that kind etomy can handle something like that. I think 0:16:02.160 --> 0:16:05.640 the world economy is very very fragile, and if it wasn't, 0:16:05.720 --> 0:16:10.480 then we would have seen uh significant moves UH years ago. 0:16:11.080 --> 0:16:14.280 But UM, I still think that we have a fragile economy. 0:16:14.320 --> 0:16:16.600 I think there's a lot of momentum with the current 0:16:16.640 --> 0:16:20.240 administration in Washington. I think the optimism is there. I 0:16:20.240 --> 0:16:23.480 think the consumer confidence is UH in a good place. 0:16:23.680 --> 0:16:26.520 But we have to show that we're making gains on 0:16:26.560 --> 0:16:30.640 the job circuit and the economy really is growing. Mark, 0:16:30.720 --> 0:16:32.560 I wonder if you could give people a little background 0:16:32.560 --> 0:16:36.560 about Third Federal savings and loan in your career, and 0:16:36.720 --> 0:16:39.000 also maybe just give us an example of one of 0:16:39.040 --> 0:16:43.920 your customers, and perhaps that would illustrate how things have changed. Sure. UM, well, 0:16:44.120 --> 0:16:47.440 my parents started Third Federal back in the midst of 0:16:47.480 --> 0:16:52.080 the depression. I'm a second generation CEO, chairman of the board, 0:16:52.680 --> 0:16:54.920 and I've been at this job for the last thirty 0:16:55.040 --> 0:17:01.080 plus years. Um. We do business in twenty six states 0:17:01.200 --> 0:17:04.200 right now, and we're the largest mortgage lender in Ohio 0:17:04.280 --> 0:17:08.360 and we have stores in Ohio and in Florida. UM. 0:17:08.600 --> 0:17:12.240 Where what a typical UH customers thinking right now? I 0:17:12.560 --> 0:17:15.640 think two things are happening. One with the rate hikes 0:17:15.760 --> 0:17:19.200 UH that have occurred. I think UH because the consumers 0:17:19.240 --> 0:17:21.440 in general are concerned that rates are going to jump 0:17:21.480 --> 0:17:23.520 and jump too high. And priced them out of the 0:17:23.520 --> 0:17:25.520 market for a mortgage. So you see a lot of 0:17:25.560 --> 0:17:28.560 people jumping in. But for the first time, and I 0:17:28.600 --> 0:17:32.879 think about ten years, we're looking at UH seasonality. And 0:17:32.920 --> 0:17:35.800 what I mean by that is traditionally this time of 0:17:35.800 --> 0:17:38.320 the year, especially in Ohio, you see a lot of 0:17:38.320 --> 0:17:42.000 people coming to the table buying homes and we haven't 0:17:42.000 --> 0:17:44.600 seen that in the last ten years. It has not 0:17:44.680 --> 0:17:47.359 been cyclical until this year. This is the first year 0:17:47.920 --> 0:17:52.240 since two thousand uh seven eight something like that that 0:17:52.280 --> 0:17:56.960 we've actually seen. What do you what does that mean? Well? 0:17:57.000 --> 0:18:00.879 I think I think it's two things. That The first 0:18:00.880 --> 0:18:04.760 thing is is that there the consumer confidence is UH 0:18:04.960 --> 0:18:09.400 is back. UM. How long that will last? It's it's 0:18:09.640 --> 0:18:11.439 you know, it's it's up in the air, depending on 0:18:11.520 --> 0:18:15.240 the policies I think, and the administrative things that come 0:18:15.240 --> 0:18:19.520 out of Washington, and regulatory relief is one of them. UM. 0:18:19.640 --> 0:18:23.160 And I think UM people are very optimistic, so they're 0:18:23.160 --> 0:18:27.080 willing to take that risk. Well, and Mark, I wonder 0:18:27.119 --> 0:18:28.960 if I want to break in there, because there was 0:18:29.000 --> 0:18:32.680 some data that was highlighted highlighted by David Schowell. Any 0:18:32.680 --> 0:18:36.280 manager that growth in loans and leases at commercial banks 0:18:36.520 --> 0:18:38.720 has pretty much come to a stop. It's kind of 0:18:38.720 --> 0:18:41.919 flatlined in the past few months. And I thought this 0:18:42.000 --> 0:18:44.680 was compelling. That flies in the face of the narrative 0:18:44.720 --> 0:18:47.080 that we've heard about how animal spirits are returning. How 0:18:47.119 --> 0:18:50.199 do you interpret this data? Well, I can't speak to 0:18:50.240 --> 0:18:52.840 commercial real estate, but I can tell you that insid 0:18:52.840 --> 0:18:56.480 commercial loans and leases, right commercial. I can't speak to 0:18:56.560 --> 0:19:00.320 commercial loans and leases because we just specialize in home ending. 0:19:00.440 --> 0:19:03.320 That's all we do. Uh, we make more home loans 0:19:03.359 --> 0:19:05.360 and like I said, and anyone in Ohio, and that's 0:19:05.359 --> 0:19:06.920 all we do. We don't do credit cards, and we 0:19:06.920 --> 0:19:10.199 don't do commercial lending. But the consumer, the person on 0:19:10.240 --> 0:19:13.480 the street who's buying a house, is more confident today 0:19:13.480 --> 0:19:17.000 than they've been in the last ten years. And just 0:19:17.119 --> 0:19:22.119 to show that, last last week, our applications were up 0:19:22.960 --> 0:19:26.520 thirty percent over last year at this time and that's 0:19:26.520 --> 0:19:29.040 the first time it's yeah, it's the first time we 0:19:29.119 --> 0:19:32.040 ever had a jump. And then preapprovals, which is people 0:19:32.040 --> 0:19:35.720 anticipating they're going to get into the housing market, anticipating 0:19:35.720 --> 0:19:39.560 they're going to buy a house, they're up about from 0:19:39.640 --> 0:19:43.159 last year. So again, the seasonality is back, which is normal, 0:19:43.640 --> 0:19:46.480 and the consumer confidence seems to be there, at least 0:19:46.480 --> 0:19:50.640 in the housing sector. Well, thanks very much, Marcus Stefanski, 0:19:51.359 --> 0:19:56.600 great great insight there, Chief executive Generate Second Generation Bank, 0:19:56.640 --> 0:20:12.360 our third Federal Savings and Loan in Ohio. Up Women 0:20:12.680 --> 0:20:15.399 for Climate Conference. We are here at the Women for 0:20:15.480 --> 0:20:18.480 Climate Conference at Columbia University in the city of New York, 0:20:18.520 --> 0:20:21.400 and I'm very glad to be here. Lisa Bramwitz. When 0:20:21.480 --> 0:20:24.520 when I think of Laureal, I confess I think cosmetics, 0:20:24.560 --> 0:20:30.840 I think lipstick, I think uh okay, but I don't 0:20:30.840 --> 0:20:34.480 necessarily think about sustainability and climate change. But here is 0:20:34.960 --> 0:20:37.159 we're going to introduce someone who's going to disabuse me 0:20:37.240 --> 0:20:41.520 of my ignorance. Alexandra Pault is the chief sustainability officer 0:20:41.680 --> 0:20:45.320 of Laureal, and she has graciously come in and jetted 0:20:45.359 --> 0:20:48.920 here from Paris via Poland via Toronto to finally arrive 0:20:49.040 --> 0:20:51.040 this morning here with us. Thank you very much for 0:20:51.040 --> 0:20:54.119 being here. Good morning. Thanks, that's a long that's a 0:20:54.160 --> 0:20:59.480 long trip to make. And so what message do you bring, 0:21:00.320 --> 0:21:04.560 uh that you've been doing this you said twenty years. 0:21:04.840 --> 0:21:07.520 I can't believe that, but that's another story. But you've 0:21:07.520 --> 0:21:13.280 been doing this company. They're probably good creams anyway, tell 0:21:13.359 --> 0:21:17.960 us what message you bring about Loreal sustainability and what 0:21:18.040 --> 0:21:20.720 people can take away that they may not know. Yes, 0:21:20.920 --> 0:21:25.080 UM at Loreal women gender equality is one of our 0:21:25.200 --> 0:21:29.040 core commitments, of course, and that for many years more 0:21:29.040 --> 0:21:33.040 than sixty of our brands are led by women. Almost 0:21:33.040 --> 0:21:36.639 half of our board the female So we are really 0:21:36.680 --> 0:21:39.600 committed to gender equality and that for a very long time. 0:21:39.960 --> 0:21:42.560 And we are also committed to fighting climate change. This 0:21:42.640 --> 0:21:46.440 is a core orientation of our company and that has 0:21:46.480 --> 0:21:50.320 resulted in already a sixty seven percent reduction of common 0:21:50.359 --> 0:21:54.920 emissions UM around the world. We had an goal of 0:21:55.040 --> 0:21:58.119 target of minors in two thousand twenty and we reached 0:21:58.119 --> 0:22:00.800 minus sixty seven percent in two south sixteen. Well, what 0:22:00.840 --> 0:22:03.720 were some of the sources the biggest sources of greenhouse 0:22:03.760 --> 0:22:08.840 gas emissions at Loyale. Well, uh, that's at the consumer level. Actually, 0:22:08.880 --> 0:22:10.760 when you look at the life cycle of a product, 0:22:10.800 --> 0:22:14.159 it's when you use hot water during a shower to 0:22:14.240 --> 0:22:17.480 wash your hair. That's the biggest source of carbon emission. 0:22:17.720 --> 0:22:21.800 But in our value chain that we can directly UM control, 0:22:22.200 --> 0:22:26.679 it's through the sourcing of raw materials, packaging, UM it 0:22:26.920 --> 0:22:31.000 is suppliers, it's production and distribution, and so we have 0:22:31.200 --> 0:22:34.200 worked on all our value change. So how much more 0:22:34.200 --> 0:22:39.480 expensive is it to be sustainably sustainability minded and and 0:22:39.520 --> 0:22:43.280 sort of to go to fair trade types of suppliers 0:22:43.280 --> 0:22:46.440 and other types of measures that you've taken. Well, um, actually, 0:22:46.560 --> 0:22:49.919 we think that it's not more expensive. And we have 0:22:50.280 --> 0:22:55.800 demonstrated that decoupling carbon emissions from growth is completely possible 0:22:56.000 --> 0:22:58.439 because we during the time where we have reduced by 0:22:58.480 --> 0:23:04.760 sixty seven also put our production group by almost exactly. 0:23:05.000 --> 0:23:09.080 So we showed that you can the couple growth from 0:23:09.119 --> 0:23:13.119 your carbon emission, production increase from carbon emissions. And of 0:23:13.160 --> 0:23:15.359 course when you work on your carbon emissions, the first 0:23:15.480 --> 0:23:18.080 source of what you're doing is working on energy efficiency. 0:23:18.240 --> 0:23:21.800 When you work on energy efficiency, you are saving money. 0:23:22.480 --> 0:23:26.160 That's very clear. And so one third of our savings 0:23:26.160 --> 0:23:28.840 and carbon emissions came from energy savings. So and then 0:23:28.880 --> 0:23:31.800 there is another point. We think we really are convinced 0:23:32.119 --> 0:23:36.960 that without these commitments to sustainability, we are not going 0:23:37.000 --> 0:23:39.280 to be a performing company in company in the twenty 0:23:39.320 --> 0:23:41.840 one century, and Loreal is around for more than one 0:23:42.320 --> 0:23:44.880 years and we want to be around for another quite 0:23:44.880 --> 0:23:47.800 a while of time, and so we have to adapt 0:23:47.840 --> 0:23:50.720 to this changing world because otherwise we are not going 0:23:50.720 --> 0:23:56.680 to be successful. The combination of brands that fall under loreal, 0:23:57.720 --> 0:23:59.840 if we were to align them up, they go everywhere, 0:23:59.880 --> 0:24:05.840 for professional brands to consumer brands, luxury George ARMANI you 0:24:05.960 --> 0:24:11.080 name it. Maybe lean everything right now as far as 0:24:11.119 --> 0:24:14.800 the packaging goes, that is such an integral part of 0:24:14.840 --> 0:24:19.360 the relationship with the customer has with the product. Has 0:24:19.400 --> 0:24:25.119 The popularity and the emergence of a climate aware customer 0:24:25.920 --> 0:24:30.080 made it easier for you to rethink the packaging, to 0:24:30.280 --> 0:24:32.879 lower the amount of waste, to get rid of things 0:24:32.960 --> 0:24:36.960 that are not essential to the product. But maybe for 0:24:37.119 --> 0:24:40.080