1 00:00:00,840 --> 00:00:04,000 Speaker 1: Welcome to the Bloomberg Markets Podcast. I'm Paul Sweeney alongside 2 00:00:04,040 --> 00:00:05,240 Speaker 1: my co host Matt Miller. 3 00:00:05,640 --> 00:00:09,560 Speaker 2: Every business day we bring you interviews from CEOs, market pros, 4 00:00:09,720 --> 00:00:13,640 Speaker 2: and Bloomberg experts, along with essential market moving news. 5 00:00:14,160 --> 00:00:17,279 Speaker 1: Find the Bloomberg Markets podcast called Apple Podcasts or wherever 6 00:00:17,400 --> 00:00:20,520 Speaker 1: you listen to podcasts, and at Bloomberg dot com slash podcast. 7 00:00:21,440 --> 00:00:23,400 Speaker 3: We're gonna go ahead and go over to Tom Gimble. 8 00:00:23,520 --> 00:00:27,440 Speaker 4: Now, he's the founder and CEO of Lesalm Network and 9 00:00:27,480 --> 00:00:29,720 Speaker 4: he this is a hiring firm, so he is going 10 00:00:29,800 --> 00:00:32,320 Speaker 4: to be able to give us a fantastic outlook of 11 00:00:32,360 --> 00:00:35,040 Speaker 4: those jobs numbers that we got yesterday and of course 12 00:00:35,200 --> 00:00:36,600 Speaker 4: the numbers that we got today. 13 00:00:36,680 --> 00:00:37,080 Speaker 3: Tom. 14 00:00:37,120 --> 00:00:39,000 Speaker 4: Great to speak with you, and thanks so much for 15 00:00:39,120 --> 00:00:41,600 Speaker 4: chatting with us on this Friday. Talk me through the 16 00:00:41,640 --> 00:00:44,440 Speaker 4: totality of the data here and what it tells you 17 00:00:44,560 --> 00:00:47,360 Speaker 4: about the jobs market. Is it the bad news that 18 00:00:47,360 --> 00:00:49,240 Speaker 4: we should be listening to or the good news? 19 00:00:50,240 --> 00:00:52,159 Speaker 5: I think an economist can spend in any way they 20 00:00:52,159 --> 00:00:55,320 Speaker 5: want to. However, anytime an economy adds over two hundred 21 00:00:55,320 --> 00:00:58,960 Speaker 5: thousand jobs, I'd say, thank you, let's move on to 22 00:00:59,000 --> 00:01:01,680 Speaker 5: the next month. I mean, there's nothing here that we 23 00:01:01,720 --> 00:01:04,960 Speaker 5: should be depressed about. I think what the layman needs 24 00:01:05,000 --> 00:01:09,360 Speaker 5: to realize is there's really two messages. One is the 25 00:01:09,360 --> 00:01:13,360 Speaker 5: economy good for me today? And number two is what 26 00:01:13,440 --> 00:01:16,360 Speaker 5: are economists and the Fed looking at for interest rates, 27 00:01:16,360 --> 00:01:19,160 Speaker 5: which is a longer ballgame at a higher macro level. 28 00:01:19,440 --> 00:01:23,920 Speaker 5: And what this says right now is that because of 29 00:01:24,880 --> 00:01:27,720 Speaker 5: two hundred and nine thousand versus roughly a quarter million, 30 00:01:27,720 --> 00:01:30,680 Speaker 5: which is what the economists were estimating, is that the 31 00:01:30,720 --> 00:01:34,200 Speaker 5: Fed won't raise interest rates again, that people think it's 32 00:01:34,240 --> 00:01:37,560 Speaker 5: slowing down, which is actually an even better thing for 33 00:01:37,600 --> 00:01:40,480 Speaker 5: the economy. So we missed the number by a smidge. 34 00:01:40,560 --> 00:01:43,119 Speaker 5: We still add over two hundred thousand jobs. The Fed 35 00:01:43,160 --> 00:01:46,920 Speaker 5: won't raise interest rate, the party continues. Everybody's happy, but 36 00:01:47,000 --> 00:01:49,120 Speaker 5: let's paint it is really sad and depressing right now. 37 00:01:49,520 --> 00:01:51,440 Speaker 6: Well, there was a time when if I could fond 38 00:01:51,440 --> 00:01:53,480 Speaker 6: a mirror, I could get a job. Is that still 39 00:01:53,480 --> 00:01:53,880 Speaker 6: the case? 40 00:01:54,880 --> 00:01:57,400 Speaker 5: It's not too far off from that, to be quite frank. 41 00:01:58,320 --> 00:02:02,600 Speaker 5: We're looking at a situation where companies are still hiring. Obviously, 42 00:02:02,640 --> 00:02:06,520 Speaker 5: we added over two hundred thousand jobs, and the difference 43 00:02:06,560 --> 00:02:09,119 Speaker 5: is is they're not hiring in bulk. So you might 44 00:02:09,160 --> 00:02:11,800 Speaker 5: not be able to get a job at any company 45 00:02:11,840 --> 00:02:14,959 Speaker 5: you want to, as you could have in twenty twenty one. However, 46 00:02:15,320 --> 00:02:17,680 Speaker 5: there are more than enough jobs for people who are 47 00:02:17,680 --> 00:02:18,720 Speaker 5: looking okay. 48 00:02:18,720 --> 00:02:22,680 Speaker 4: But when you look at the ADP data specifically, leisure 49 00:02:22,800 --> 00:02:25,400 Speaker 4: was the biggest growth area. But leisure, I mean, you 50 00:02:25,440 --> 00:02:27,600 Speaker 4: can tell me this, Tom, It feels like a little 51 00:02:27,639 --> 00:02:32,560 Speaker 4: bit of a concerning area because it can those jobs 52 00:02:32,560 --> 00:02:34,600 Speaker 4: can go away so fast, and we obviously saw that 53 00:02:34,760 --> 00:02:35,120 Speaker 4: in March. 54 00:02:35,240 --> 00:02:39,600 Speaker 5: Seasonality No, no, I disagree because it's seasonality. So compare 55 00:02:39,680 --> 00:02:42,160 Speaker 5: June over June and look at the summer, and we 56 00:02:42,240 --> 00:02:45,240 Speaker 5: know those are coming. So that was built into the 57 00:02:45,360 --> 00:02:48,640 Speaker 5: estimate that the economists had that they've been doing this 58 00:02:48,720 --> 00:02:51,320 Speaker 5: for forever. And when they predict two hundred and forty 59 00:02:51,400 --> 00:02:53,600 Speaker 5: thousand or two hundred and fifty thousand, they're figuring in 60 00:02:53,639 --> 00:02:57,480 Speaker 5: for the summer hospitality jobs too. This is a good report. 61 00:02:57,600 --> 00:03:00,679 Speaker 5: Anything other is chicken little, as I say every month 62 00:03:00,720 --> 00:03:01,240 Speaker 5: on this show. 63 00:03:01,320 --> 00:03:04,880 Speaker 4: But is it potentially a final gasp for air before 64 00:03:04,960 --> 00:03:06,440 Speaker 4: the economy starts to slow? 65 00:03:07,639 --> 00:03:10,400 Speaker 5: No, I really don't think so, because what's gonna end 66 00:03:10,440 --> 00:03:12,600 Speaker 5: up My guess is I haven't what's the market doing right? 67 00:03:12,639 --> 00:03:16,760 Speaker 6: Now, oh, with a stock market, I'm gonna call it mixed. 68 00:03:16,919 --> 00:03:18,679 Speaker 3: Yeah, it's a little unch very much. 69 00:03:19,520 --> 00:03:23,000 Speaker 5: It's unchanged, right, So what that message sends. If it 70 00:03:23,040 --> 00:03:25,960 Speaker 5: were a bad number, the market would be down. It's 71 00:03:25,960 --> 00:03:28,640 Speaker 5: a number that says we're still adding jobs. And once 72 00:03:28,680 --> 00:03:30,919 Speaker 5: the Fed doesn't raise rates at the next go around, 73 00:03:31,160 --> 00:03:32,960 Speaker 5: this thing is gonna shoot. The market's gonna shoot up 74 00:03:33,000 --> 00:03:36,200 Speaker 5: even more. We added over two hundred thousand jobs. It's 75 00:03:36,240 --> 00:03:39,560 Speaker 5: funny how quickly we forget the spring of twenty twenty. 76 00:03:39,640 --> 00:03:42,360 Speaker 5: It's funny how quickly we forget two thousand and eight 77 00:03:42,400 --> 00:03:46,440 Speaker 5: and two thousand and nine. Those were bad. This is good. 78 00:03:47,000 --> 00:03:48,240 Speaker 5: We got to keep things in. 79 00:03:48,200 --> 00:03:52,360 Speaker 6: Perspective, Tom Doo, Who has the leverage is that the 80 00:03:52,680 --> 00:03:55,720 Speaker 6: mixed starting to change is still the employee, like, hey, 81 00:03:55,760 --> 00:03:57,920 Speaker 6: you can give me a raise or else I'm gonna 82 00:03:57,920 --> 00:03:59,880 Speaker 6: go find another job. But we're with the employer. 83 00:04:00,440 --> 00:04:04,120 Speaker 5: We've gotten away from that. The leverage is back on 84 00:04:04,160 --> 00:04:07,400 Speaker 5: the employer side, and I think that's what the changes 85 00:04:07,440 --> 00:04:09,240 Speaker 5: that we're seeing. And if there's a little bit of 86 00:04:10,000 --> 00:04:13,440 Speaker 5: not desperation in the air, but fear around, it's people 87 00:04:13,480 --> 00:04:16,880 Speaker 5: bringing employee companies bringing employees back to the office. And 88 00:04:16,920 --> 00:04:19,640 Speaker 5: the employees can't quit and go get another job working 89 00:04:19,680 --> 00:04:22,760 Speaker 5: fully remote anymore because a lot of companies are bringing 90 00:04:22,760 --> 00:04:25,960 Speaker 5: people back to the office. So my feeling is a 91 00:04:26,040 --> 00:04:28,280 Speaker 5: year from now, we're not going to be talking oh, 92 00:04:28,400 --> 00:04:31,200 Speaker 5: post pandemic and who's working in the office and who's 93 00:04:31,240 --> 00:04:34,159 Speaker 5: working not Almost every company will be three days a week, 94 00:04:34,200 --> 00:04:36,000 Speaker 5: if not four days a week a year from now. 95 00:04:36,400 --> 00:04:39,800 Speaker 4: And where are you seeing the most demand for workers. 96 00:04:40,440 --> 00:04:43,320 Speaker 5: It's always going to be in technology right now because 97 00:04:43,360 --> 00:04:46,240 Speaker 5: we have well, we have this intersection right now where 98 00:04:46,600 --> 00:04:51,599 Speaker 5: it's technology is growing so fast and we're having so 99 00:04:51,920 --> 00:04:54,599 Speaker 5: Now we have AI, which is what dot Com was 100 00:04:54,680 --> 00:04:57,360 Speaker 5: twenty years ago. Right twenty years ago, you put dot 101 00:04:57,400 --> 00:05:00,200 Speaker 5: com in your company's name and you'd go public. Can 102 00:05:00,240 --> 00:05:02,560 Speaker 5: you'd be worth a billion dollars? Just wait until every 103 00:05:02,560 --> 00:05:05,520 Speaker 5: company has it being less sound network AI. Everything is 104 00:05:05,560 --> 00:05:08,320 Speaker 5: going to be AI AI AI, and we're going to 105 00:05:08,360 --> 00:05:10,960 Speaker 5: see this be a self fulfilling prophecy that it's going 106 00:05:11,000 --> 00:05:12,840 Speaker 5: to balloon a new market and it's going to be 107 00:05:12,880 --> 00:05:15,800 Speaker 5: the driver of jobs through AI and cybersecurity. 108 00:05:16,400 --> 00:05:19,159 Speaker 6: Well, what's go over average pay for me in the 109 00:05:19,200 --> 00:05:22,160 Speaker 6: different industries that you are familiar with. 110 00:05:23,120 --> 00:05:26,880 Speaker 5: Well, I think average pay is a really interesting issue, 111 00:05:26,920 --> 00:05:29,760 Speaker 5: and the reason is is because it figures in salaried 112 00:05:30,160 --> 00:05:33,000 Speaker 5: and hourly, and we have hourlyas that have been en 113 00:05:33,680 --> 00:05:36,560 Speaker 5: that have rose over the past three years due to 114 00:05:36,800 --> 00:05:41,279 Speaker 5: number one COVID pandemic, pay, number two social unrest, number 115 00:05:41,320 --> 00:05:46,960 Speaker 5: three municipalities wanting to with more liberal aldermen so to speak, 116 00:05:47,200 --> 00:05:49,600 Speaker 5: and mayors and officials running it. So we've seen the 117 00:05:50,360 --> 00:05:54,120 Speaker 5: municipal minimum wage rise that used to be ten dollars 118 00:05:54,200 --> 00:05:56,840 Speaker 5: an hour. In some cities it's fifteen to seventeen dollars 119 00:05:56,839 --> 00:06:00,279 Speaker 5: an hour. And we've seen hourly factory workers and hourly 120 00:06:00,360 --> 00:06:02,920 Speaker 5: warehouse workers go from ten to twelve dollars an hour 121 00:06:03,160 --> 00:06:05,480 Speaker 5: to eighteen to twenty to twenty five dollars an hour. 122 00:06:05,560 --> 00:06:07,960 Speaker 5: So you have that aspect of the business which is 123 00:06:08,040 --> 00:06:12,400 Speaker 5: still healthy, but we'll see how that gets affected. It's 124 00:06:12,480 --> 00:06:15,159 Speaker 5: usually the first area. The interesting thing is on the 125 00:06:15,160 --> 00:06:19,000 Speaker 5: white collar jobs, where people were getting counteroffers from their 126 00:06:19,000 --> 00:06:22,520 Speaker 5: employer when they leave for huge amounts to get them 127 00:06:22,560 --> 00:06:25,320 Speaker 5: to stay. We're not seeing that as much anymore. We're 128 00:06:25,360 --> 00:06:27,880 Speaker 5: seeing companies toe the line and say we're not going 129 00:06:27,920 --> 00:06:31,080 Speaker 5: to screw up our whole salary structure. Because the economy's good, 130 00:06:31,560 --> 00:06:32,560 Speaker 5: not unbelievable. 131 00:06:32,960 --> 00:06:35,880 Speaker 4: But we're seeing also a decline to your point in 132 00:06:35,960 --> 00:06:39,960 Speaker 4: weekly hours worked. Is that a key indicator to you 133 00:06:40,240 --> 00:06:42,440 Speaker 4: of something that's to come and is that something that 134 00:06:42,480 --> 00:06:44,720 Speaker 4: you're seeing in your day to day now. 135 00:06:44,839 --> 00:06:47,120 Speaker 5: I think you see a decline in weekly hours work 136 00:06:47,240 --> 00:06:49,919 Speaker 5: because of the increase in the hospitality sector. And so 137 00:06:50,000 --> 00:06:53,240 Speaker 5: when you've got people that are hiring in those phases, 138 00:06:53,279 --> 00:06:56,279 Speaker 5: it sometimes leverages down the amount of hours work by 139 00:06:56,320 --> 00:06:58,880 Speaker 5: each employee. And so the thing that makes it good 140 00:06:58,960 --> 00:07:01,159 Speaker 5: is that more people are getting jobs in that space. 141 00:07:01,440 --> 00:07:03,680 Speaker 5: The thing that makes it bad is some people who 142 00:07:03,720 --> 00:07:06,240 Speaker 5: are working over time and doing things like that. It's 143 00:07:06,279 --> 00:07:08,599 Speaker 5: not leveraged into the average hours, so you see a 144 00:07:08,680 --> 00:07:11,520 Speaker 5: natural decline in that way. You also see more people 145 00:07:11,560 --> 00:07:14,280 Speaker 5: taking time off in the summer, which lowers the average 146 00:07:14,320 --> 00:07:16,080 Speaker 5: hours worked. I don't think that's as big a deal 147 00:07:16,120 --> 00:07:17,160 Speaker 5: as a lot of economists do. 148 00:07:17,640 --> 00:07:20,000 Speaker 6: Can you give me an update on the gig economy? 149 00:07:20,040 --> 00:07:21,160 Speaker 6: Where does where does that stand? 150 00:07:22,040 --> 00:07:22,280 Speaker 7: Yeah? 151 00:07:22,720 --> 00:07:27,119 Speaker 5: I think the gig economy was a gig. I think 152 00:07:27,200 --> 00:07:30,880 Speaker 5: that it was something that we're seeing that people in 153 00:07:31,240 --> 00:07:34,360 Speaker 5: good times. It's awesome. I don't need my boss. I 154 00:07:34,400 --> 00:07:36,440 Speaker 5: can get a job whenever I want, so, I'll go uber, 155 00:07:36,520 --> 00:07:40,080 Speaker 5: I'll do door dash, I'll be a dog walker, I'll 156 00:07:40,080 --> 00:07:42,000 Speaker 5: do all these things. And that's why it didn't show 157 00:07:42,040 --> 00:07:45,000 Speaker 5: into the jobs numbers. Now we see those people saying, hey, 158 00:07:45,000 --> 00:07:47,240 Speaker 5: wait a second, I can't keep up with the cost 159 00:07:47,280 --> 00:07:51,440 Speaker 5: of living doing that. I need to get benefits. I 160 00:07:51,480 --> 00:07:53,200 Speaker 5: want to have a four to oh one k. People 161 00:07:53,240 --> 00:07:57,520 Speaker 5: start to settle in as gen Z becomes in their thirties, right, 162 00:07:57,560 --> 00:07:59,600 Speaker 5: So you have this cyclical nature. That's something that happened 163 00:07:59,600 --> 00:08:02,720 Speaker 5: with MILLENNI and they don't want to be doing gig economy. 164 00:08:02,200 --> 00:08:05,280 Speaker 4: Work really quickly. Thirty seconds here, Tom, If J. Powell 165 00:08:05,280 --> 00:08:07,000 Speaker 4: calls you and says, what do I need to know 166 00:08:07,040 --> 00:08:09,520 Speaker 4: about the jobs market that the economists aren't telling me? 167 00:08:09,600 --> 00:08:11,360 Speaker 3: What are you saying, I tell him. 168 00:08:11,240 --> 00:08:12,680 Speaker 5: The same thing I told him this morning when we 169 00:08:12,680 --> 00:08:16,040 Speaker 5: were talking. No, I'm kidding. I would tell him keep 170 00:08:16,080 --> 00:08:18,160 Speaker 5: things flat for the next cycle, don't do a thing. 171 00:08:18,760 --> 00:08:21,240 Speaker 4: All right, Well, we'll see if the market agrees with 172 00:08:21,320 --> 00:08:23,240 Speaker 4: you there. Tom, thank you so much for joining us 173 00:08:23,240 --> 00:08:25,760 Speaker 4: this morning to break down that job's data for us. 174 00:08:25,880 --> 00:08:29,280 Speaker 3: That was Tom Gimble. He is CEO at LaSalle Network. 175 00:08:29,280 --> 00:08:31,880 Speaker 4: That's a hiring firm, so John, he's got a great 176 00:08:31,920 --> 00:08:34,440 Speaker 4: outlook on what's really going on on the ground when 177 00:08:34,480 --> 00:08:35,760 Speaker 4: it comes to hiring and wages. 178 00:08:35,800 --> 00:08:40,040 Speaker 8: There you're listening to the team Ken's are Live program 179 00:08:40,160 --> 00:08:44,120 Speaker 8: Bloomberg Markets weekdays at ten am Eastern on Bloomberg dot Com, 180 00:08:44,200 --> 00:08:47,360 Speaker 8: the iHeartRadio app and the Bloomberg Business App, or listen 181 00:08:47,440 --> 00:08:49,520 Speaker 8: on demand wherever you get your podcast. 182 00:08:52,520 --> 00:08:56,800 Speaker 4: We were easing some of those declines earlier today and 183 00:08:56,840 --> 00:08:58,520 Speaker 4: now it's looking like we're back in the red for 184 00:08:58,559 --> 00:09:01,760 Speaker 4: the S and p NASDAC relatively unchanged. So we're going 185 00:09:01,800 --> 00:09:04,080 Speaker 4: to talk about what to make of the day's trade 186 00:09:04,080 --> 00:09:08,120 Speaker 4: with Ben Emmons. He is the principal, senior portfolio manager 187 00:09:08,360 --> 00:09:11,559 Speaker 4: and head of fixed income and Macro at New Edge Wealth. 188 00:09:11,960 --> 00:09:13,240 Speaker 3: Got a laundry. 189 00:09:12,760 --> 00:09:17,880 Speaker 4: List of previous work in the finance industry that we're 190 00:09:17,880 --> 00:09:19,600 Speaker 4: going to talk to him about. Ben, thanks for being 191 00:09:19,600 --> 00:09:22,880 Speaker 4: in studio with us. Helped me make sense of what's 192 00:09:22,960 --> 00:09:26,400 Speaker 4: going on in markets today. How are they digesting the 193 00:09:26,480 --> 00:09:27,080 Speaker 4: data here? 194 00:09:27,640 --> 00:09:30,400 Speaker 9: Still digesting medisine, But I think it's about you know, 195 00:09:30,440 --> 00:09:32,439 Speaker 9: the ADP number took a lot of the gas out 196 00:09:32,480 --> 00:09:35,640 Speaker 9: of the market. Because I was a real surprise. So 197 00:09:35,679 --> 00:09:38,400 Speaker 9: it's this headline from non fan patals comes in a 198 00:09:38,440 --> 00:09:42,480 Speaker 9: little softer, you get some muted reaction, but the reaction 199 00:09:42,600 --> 00:09:45,640 Speaker 9: is the same as yesterday. I yields a little bit 200 00:09:45,640 --> 00:09:49,000 Speaker 9: lower stocks because the market's trying to digeste This is 201 00:09:49,040 --> 00:09:52,280 Speaker 9: a job market that doesn't really cool off. If anything, 202 00:09:52,280 --> 00:09:55,520 Speaker 9: it just really underlines that the FED has to pull 203 00:09:55,600 --> 00:09:58,720 Speaker 9: forward here. It has to probably hike maybe more than 204 00:09:58,760 --> 00:10:02,320 Speaker 9: two times because the resiliency of the economy, you know, 205 00:10:02,360 --> 00:10:06,160 Speaker 9: there's too much strength underneath. And I know these reporters 206 00:10:06,160 --> 00:10:09,240 Speaker 9: that didn't show any significant weakness in any area. So 207 00:10:09,320 --> 00:10:11,760 Speaker 9: I think markets are looking at like we're going to 208 00:10:11,840 --> 00:10:14,840 Speaker 9: have to start factoring in a higher terminal rate that 209 00:10:14,920 --> 00:10:17,000 Speaker 9: may be beyond what the FED is factoring it in 210 00:10:17,000 --> 00:10:17,640 Speaker 9: for the end of the year. 211 00:10:18,040 --> 00:10:21,120 Speaker 6: You know, little history. One of the former FED chairman, 212 00:10:21,160 --> 00:10:24,400 Speaker 6: Paul Volker, used to carry in his breast pocket a 213 00:10:24,480 --> 00:10:29,960 Speaker 6: readout of the latest labor agreements, wage agreements with the unions. 214 00:10:30,040 --> 00:10:35,120 Speaker 6: Presumably how sticky are wages right now, because that seems 215 00:10:35,120 --> 00:10:37,959 Speaker 6: to be the key for all of us who follow 216 00:10:38,000 --> 00:10:38,800 Speaker 6: interest rates. 217 00:10:39,160 --> 00:10:42,560 Speaker 9: Yeah, the the every average hourly earnings of four point 218 00:10:42,640 --> 00:10:45,000 Speaker 9: four percent year on year. There was another I think 219 00:10:45,600 --> 00:10:48,880 Speaker 9: sign of that if you have labor being this strong 220 00:10:49,320 --> 00:10:52,720 Speaker 9: consistent job gains, you're going to get higher wages. And 221 00:10:52,880 --> 00:10:56,360 Speaker 9: every wage striking from the Atlanta FAT shows an upward momentum. 222 00:10:56,960 --> 00:10:58,959 Speaker 9: The ones that stand out to me are construction and 223 00:10:59,080 --> 00:11:01,720 Speaker 9: leisured as well. I think the biggest wage gains are happening. 224 00:11:02,200 --> 00:11:05,680 Speaker 9: There's maybe less of unionized area then if you think 225 00:11:05,679 --> 00:11:08,360 Speaker 9: about ups as an example right of what's happening there. 226 00:11:09,320 --> 00:11:12,760 Speaker 9: But to that point of Vocar, if you're getting consistent 227 00:11:13,160 --> 00:11:17,040 Speaker 9: gains of labor and wages pick up, yeah, there's some 228 00:11:17,160 --> 00:11:20,920 Speaker 9: level of let's say, prices drive to higher wages and 229 00:11:21,000 --> 00:11:24,040 Speaker 9: vice versa. So it is happening in the economy. Not 230 00:11:24,120 --> 00:11:26,520 Speaker 9: the same as in the seventies, but it's definitely a 231 00:11:26,600 --> 00:11:27,840 Speaker 9: trend of higher wages. 232 00:11:28,720 --> 00:11:30,920 Speaker 6: I'll go back to my ques. Is that sticky? Is 233 00:11:30,920 --> 00:11:31,800 Speaker 6: that going to remain? 234 00:11:32,679 --> 00:11:33,280 Speaker 10: It looks like. 235 00:11:33,240 --> 00:11:37,320 Speaker 9: It's sticky because if you think of the core pce exer, 236 00:11:38,080 --> 00:11:41,600 Speaker 9: core services, pce X housing you plot out against those 237 00:11:41,640 --> 00:11:44,880 Speaker 9: wage trackers from the Atlanta FAT, it's exactly the same trend, 238 00:11:45,040 --> 00:11:47,760 Speaker 9: almost identical, just on top of each other. That looks 239 00:11:47,800 --> 00:11:48,840 Speaker 9: like very sticky to me. 240 00:11:49,640 --> 00:11:52,640 Speaker 3: How sticky then, Okay, I've been dying to ask this question. 241 00:11:52,720 --> 00:11:55,360 Speaker 4: John, You're gonna love this. On a scale of peanut 242 00:11:55,400 --> 00:11:58,160 Speaker 4: butter to super glue, how sticky? 243 00:11:59,200 --> 00:12:04,120 Speaker 9: Oh not super glue. I don't compares that probably is 244 00:12:04,160 --> 00:12:07,040 Speaker 9: not because it is a competitive labor market. So I 245 00:12:07,080 --> 00:12:09,120 Speaker 9: do think that if you get layoffs, so you get like, 246 00:12:09,280 --> 00:12:13,080 Speaker 9: you know, some adjustment of wages in certain areas, it's 247 00:12:13,120 --> 00:12:15,920 Speaker 9: just more stickier in terms of the demand for labors. 248 00:12:16,480 --> 00:12:19,080 Speaker 9: Is sticky that or drives up wages. I think that's 249 00:12:19,120 --> 00:12:21,640 Speaker 9: the issue. The Commerce Department put out of a board 250 00:12:21,640 --> 00:12:24,600 Speaker 9: about a month ago highlighting all the labor shortages across 251 00:12:24,600 --> 00:12:26,520 Speaker 9: the economy. There's a lot of it still there that 252 00:12:27,040 --> 00:12:29,120 Speaker 9: keeps those wages like peing a butter. 253 00:12:29,480 --> 00:12:32,120 Speaker 3: Okay, well you you well, there you go. You do 254 00:12:32,200 --> 00:12:32,720 Speaker 3: a great job. 255 00:12:32,760 --> 00:12:35,240 Speaker 4: Though, ben of looking at this from a global perspective, 256 00:12:35,360 --> 00:12:37,480 Speaker 4: and when you look at the inflation picture in the UK, 257 00:12:37,600 --> 00:12:39,520 Speaker 4: it makes me glad that I'm in the US, even 258 00:12:39,520 --> 00:12:43,439 Speaker 4: though inflation here is pretty bleak for me when I'm 259 00:12:43,480 --> 00:12:46,480 Speaker 4: being a consumer outside of the desk here, talk to 260 00:12:46,520 --> 00:12:49,440 Speaker 4: me about to what extent the inflation picture in the 261 00:12:49,520 --> 00:12:52,160 Speaker 4: UK and the credit tight ning we're seeing there could 262 00:12:52,320 --> 00:12:54,600 Speaker 4: impact what the FED has to do here in the States. 263 00:12:55,280 --> 00:12:56,839 Speaker 9: Yeah, there's a bit of that. That's the idea of 264 00:12:56,920 --> 00:13:01,400 Speaker 9: butterfly fact. Yeah, you know, I think is more risk 265 00:13:01,440 --> 00:13:04,040 Speaker 9: of that rage price spiral part of it. There is 266 00:13:04,160 --> 00:13:08,000 Speaker 9: more unionized economy, but it's also it's showing the signs 267 00:13:08,000 --> 00:13:11,240 Speaker 9: of it. And you know, the UK obviously is really 268 00:13:11,280 --> 00:13:15,240 Speaker 9: suffering from the supply shock in Europe, the food supply 269 00:13:15,320 --> 00:13:19,079 Speaker 9: shock that's compounded by the Brexit. You know, that's now 270 00:13:19,120 --> 00:13:22,480 Speaker 9: really showing up in their data and they're you know, 271 00:13:22,840 --> 00:13:25,160 Speaker 9: the Bank of England didn't go so far as to 272 00:13:25,240 --> 00:13:28,480 Speaker 9: feted with a number of rate hikes really quickly after 273 00:13:28,520 --> 00:13:30,920 Speaker 9: one of not like large rate hikes, and this is 274 00:13:30,960 --> 00:13:33,240 Speaker 9: why the market is pricing in six and a half 275 00:13:33,240 --> 00:13:36,000 Speaker 9: percent of a bank rate that's on the base points 276 00:13:36,040 --> 00:13:39,560 Speaker 9: more than the where the FAT is projected at. I 277 00:13:39,559 --> 00:13:43,520 Speaker 9: think the food price inflation is where they're struggling. They 278 00:13:43,559 --> 00:13:46,559 Speaker 9: can't really cool that off because of the Brexit effect. 279 00:13:46,640 --> 00:13:48,160 Speaker 9: That's really the key issue. 280 00:13:48,320 --> 00:13:49,840 Speaker 6: Does the market now believe the Fed? 281 00:13:51,480 --> 00:13:54,240 Speaker 9: They do, John, I mean it has actually been there 282 00:13:54,240 --> 00:13:58,480 Speaker 9: way for a while. Sounds odd, but that transitory discussion 283 00:13:58,640 --> 00:14:01,880 Speaker 9: that where the fat apparently lost so much credibility, you know, 284 00:14:01,920 --> 00:14:04,080 Speaker 9: the bomb market early on, except like, well, Fat, you 285 00:14:04,160 --> 00:14:06,719 Speaker 9: started raising rates, You're going to get your inflation back 286 00:14:06,760 --> 00:14:09,319 Speaker 9: to two percent over time. That's what the inflation lik 287 00:14:09,320 --> 00:14:13,200 Speaker 9: bonb market has been very consistent in and that's I 288 00:14:13,200 --> 00:14:16,760 Speaker 9: think where we currently are today. It hasn't really changed 289 00:14:17,480 --> 00:14:20,200 Speaker 9: even though you're getting these good, you know, payroll numbers 290 00:14:20,200 --> 00:14:25,000 Speaker 9: and you see it continuing strength in the economy. There's 291 00:14:25,040 --> 00:14:27,400 Speaker 9: another side of it that the energy markets have really 292 00:14:27,400 --> 00:14:30,240 Speaker 9: cooled off from last year and commodity market students. That helps. 293 00:14:30,280 --> 00:14:33,600 Speaker 9: I mean, it's part of that calculation in these inflation expectations. 294 00:14:34,120 --> 00:14:36,320 Speaker 9: But I do think that market has been at the 295 00:14:36,360 --> 00:14:38,480 Speaker 9: side of the Fat saying you're going to succeed in 296 00:14:38,520 --> 00:14:40,600 Speaker 9: this mission. You're going to bring that inflation right down. 297 00:14:40,600 --> 00:14:42,840 Speaker 9: It may take a number of years, but you're going together, all. 298 00:14:42,800 --> 00:14:48,160 Speaker 6: Right, the obligatory questions. July that is twenty five basis points. Again, 299 00:14:48,400 --> 00:14:51,240 Speaker 6: what happens after that? Is it a higher rate regime 300 00:14:51,920 --> 00:14:55,240 Speaker 6: six months from now? You got forty five seconds. 301 00:14:55,320 --> 00:14:58,200 Speaker 9: Yeah, so July that's now of course confirmed by this 302 00:14:58,320 --> 00:15:01,080 Speaker 9: data at CPI next week, so that probably he's going 303 00:15:01,120 --> 00:15:04,800 Speaker 9: to fully cement it to one hundred percent probability. You 304 00:15:04,840 --> 00:15:06,960 Speaker 9: know it will remain data dependent. That's how the market 305 00:15:07,080 --> 00:15:09,720 Speaker 9: is trying to price it. So the September and November 306 00:15:09,760 --> 00:15:12,440 Speaker 9: meetings all still in play. But the probabilities do show 307 00:15:12,920 --> 00:15:14,840 Speaker 9: that you'd like you have an honor rate high extra. 308 00:15:14,840 --> 00:15:19,400 Speaker 9: The federal match is median forecast plus. The probability of 309 00:15:19,400 --> 00:15:21,880 Speaker 9: a six percent rate in November has notched up a 310 00:15:21,880 --> 00:15:24,280 Speaker 9: little bit. It's about ten percent. So let's keep an 311 00:15:24,280 --> 00:15:26,560 Speaker 9: eye on that because that is not impossible to see 312 00:15:26,560 --> 00:15:27,360 Speaker 9: a six percent rate. 313 00:15:27,880 --> 00:15:30,000 Speaker 3: Yeah, and it seems like if you're listening to j. 314 00:15:30,160 --> 00:15:32,000 Speaker 4: Powell, he's just going to continue to look at the 315 00:15:32,040 --> 00:15:34,760 Speaker 4: totality of the data when deciding what he is going 316 00:15:34,800 --> 00:15:37,200 Speaker 4: to do next. Ben Emmons, thank you so much for 317 00:15:37,320 --> 00:15:39,520 Speaker 4: joining us as always, great to see you in the 318 00:15:39,520 --> 00:15:42,960 Speaker 4: studio with us as well. That was Ben Emmons's principal, 319 00:15:43,000 --> 00:15:46,360 Speaker 4: senior portfolio manager and head of fixed income at New 320 00:15:46,440 --> 00:15:48,760 Speaker 4: Edge Wealth, joining to talk about those jobs numbers and 321 00:15:48,800 --> 00:15:51,240 Speaker 4: of course what the Fed is going to do next? 322 00:15:51,240 --> 00:15:53,640 Speaker 3: Our favorite question here at Bloomberg. 323 00:15:53,920 --> 00:15:57,040 Speaker 8: You're listening to the tape. Can's our live program Bloomberg 324 00:15:57,080 --> 00:16:00,680 Speaker 8: Markets weekdays at ten am Eastern on Bloomberg Radio, the 325 00:16:00,720 --> 00:16:03,960 Speaker 8: tune in app, Bloomberg dot Com, and the Bloomberg Business App. 326 00:16:04,000 --> 00:16:06,800 Speaker 8: You can also listen live on Amazon Alexa from our 327 00:16:06,840 --> 00:16:11,800 Speaker 8: flagship New York station, Just say Alexa play Bloomberg eleven thirty. 328 00:16:13,200 --> 00:16:15,800 Speaker 4: No, you're all loving our FED Speak analysis here, but 329 00:16:15,800 --> 00:16:18,080 Speaker 4: we've got a great guest in to talk with us 330 00:16:18,360 --> 00:16:20,600 Speaker 4: about the jobs data and how it's going to impact 331 00:16:20,720 --> 00:16:22,440 Speaker 4: FED mooves moving forward. 332 00:16:22,440 --> 00:16:23,960 Speaker 3: We've got Julia Pollock here. 333 00:16:24,520 --> 00:16:27,960 Speaker 4: She is a chief economist at zip Recruiter, joining us 334 00:16:28,040 --> 00:16:30,880 Speaker 4: on zoom to talk through some of these jobs numbers. Julia, 335 00:16:30,920 --> 00:16:35,720 Speaker 4: thank you so much for coming on this morning with us. 336 00:16:36,040 --> 00:16:38,720 Speaker 4: Talk to me about what your take is on the 337 00:16:38,800 --> 00:16:41,240 Speaker 4: current jobs market. I mean, if we're listening to gooules By, 338 00:16:41,280 --> 00:16:43,680 Speaker 4: it sounds like it's strong but cooling. 339 00:16:44,120 --> 00:16:45,520 Speaker 3: Would you agree with that description? 340 00:16:46,720 --> 00:16:51,440 Speaker 11: Absolutely strong, solid, robust, But there are clear signs of 341 00:16:51,480 --> 00:16:56,400 Speaker 11: cooling in today's jobs report, not just the slowest job 342 00:16:56,440 --> 00:17:00,360 Speaker 11: growth number since decem for twenty twenty, but also rise 343 00:17:00,440 --> 00:17:03,200 Speaker 11: in the number of people working part time for economic reasons. 344 00:17:03,240 --> 00:17:05,520 Speaker 11: Those are people who've had their hours cut or who 345 00:17:05,680 --> 00:17:08,120 Speaker 11: can't find full time work but want to be working 346 00:17:08,119 --> 00:17:08,639 Speaker 11: full time. 347 00:17:09,520 --> 00:17:14,320 Speaker 6: You guys, a ZIP recruiter must generate its own proprietary data. 348 00:17:14,359 --> 00:17:16,120 Speaker 6: What does that tell you, if anything? 349 00:17:16,320 --> 00:17:20,880 Speaker 11: Absolutely so, that has shown a large decline in online 350 00:17:21,000 --> 00:17:25,439 Speaker 11: job hostings than even in BLS reported jobs data, but 351 00:17:26,600 --> 00:17:31,800 Speaker 11: a rebound in June. So we also saw a pretty 352 00:17:31,840 --> 00:17:36,840 Speaker 11: strong June, but even clearer signs that the lave market 353 00:17:36,880 --> 00:17:38,960 Speaker 11: is cooling down and that the Fed's interest rate hikes 354 00:17:38,960 --> 00:17:42,200 Speaker 11: are starting to bite. That they are reducing private investment 355 00:17:42,480 --> 00:17:44,919 Speaker 11: and causing companies, even those that would like to be 356 00:17:45,000 --> 00:17:49,840 Speaker 11: hiring more, to be a bit more cautious and concerned. 357 00:17:50,480 --> 00:17:53,600 Speaker 6: What about wages? What does your data show? 358 00:17:55,320 --> 00:17:59,480 Speaker 11: So wage growth in job hostings has also slowed In 359 00:17:59,600 --> 00:18:04,240 Speaker 11: twenty twenty two, the share of job titles that saw 360 00:18:04,560 --> 00:18:09,280 Speaker 11: average wage increases over the year was three times higher 361 00:18:09,280 --> 00:18:12,400 Speaker 11: than the share that saw declines. This time around, we're 362 00:18:12,400 --> 00:18:19,159 Speaker 11: actually seeing more job titles show lower average posted wages 363 00:18:19,400 --> 00:18:21,359 Speaker 11: in job hostings than games. 364 00:18:22,359 --> 00:18:26,119 Speaker 4: Yeah, it's so important to watch. And our Bloomberg Economics 365 00:18:26,160 --> 00:18:29,680 Speaker 4: team puts it really well that they still anticipate a 366 00:18:29,720 --> 00:18:32,480 Speaker 4: recession coming in the second half of twenty twenty three. 367 00:18:32,560 --> 00:18:33,760 Speaker 3: So anytime now. 368 00:18:33,560 --> 00:18:36,040 Speaker 4: And they say that you start to see those cracks 369 00:18:36,040 --> 00:18:39,280 Speaker 4: in the labor market about two to three quarters after 370 00:18:39,440 --> 00:18:42,960 Speaker 4: recession officially begins. So, Julia, I wonder if when you're 371 00:18:43,000 --> 00:18:45,600 Speaker 4: looking at the data, does it feel to you like 372 00:18:45,960 --> 00:18:48,800 Speaker 4: this is just the beginning of the title wave of 373 00:18:48,880 --> 00:18:52,159 Speaker 4: recessionary impacts on the jobs market, or is it something 374 00:18:52,240 --> 00:18:53,199 Speaker 4: less intense than that. 375 00:18:54,560 --> 00:18:56,200 Speaker 11: Well, I think it's something less intense than that. I 376 00:18:56,200 --> 00:18:59,040 Speaker 11: think we're now at a place where the labor market 377 00:18:59,240 --> 00:19:02,840 Speaker 11: is at as steady sustainable pace. We could keep this 378 00:19:03,000 --> 00:19:06,159 Speaker 11: up for months and months and months. Employment levels are 379 00:19:06,200 --> 00:19:08,840 Speaker 11: still well below their pre pandemic trend, and so there's 380 00:19:08,880 --> 00:19:11,040 Speaker 11: still a lot of catch up hiring that could take 381 00:19:11,040 --> 00:19:13,760 Speaker 11: place in the coming months. Industries that were hardest hit 382 00:19:13,760 --> 00:19:16,120 Speaker 11: in the recession are sort of finally playing catch up, 383 00:19:16,240 --> 00:19:18,600 Speaker 11: like the government, not an industry, but you know what 384 00:19:18,640 --> 00:19:22,760 Speaker 11: I mean, a sector that was far behind. So I 385 00:19:22,800 --> 00:19:24,600 Speaker 11: think there are lots of reasons to be bullish on 386 00:19:24,640 --> 00:19:27,920 Speaker 11: this labor market still. And then we also just had 387 00:19:27,920 --> 00:19:30,480 Speaker 11: an almost fifteen percent return in the stock market year 388 00:19:30,520 --> 00:19:34,800 Speaker 11: to date and a rebound and consumer confidence. All of 389 00:19:34,840 --> 00:19:37,959 Speaker 11: those things could bode well for job growth in the future. 390 00:19:38,160 --> 00:19:41,639 Speaker 11: There are huge risks, don't get me wrong, but I 391 00:19:41,680 --> 00:19:46,320 Speaker 11: don't think we necessarily are in a bad place. 392 00:19:47,160 --> 00:19:49,840 Speaker 6: I put this question just about every guest we had today. 393 00:19:49,880 --> 00:19:52,720 Speaker 6: I'll put it to you who's in the driver's seat, 394 00:19:52,880 --> 00:19:56,960 Speaker 6: the employers have the leverage or the employees. 395 00:19:58,040 --> 00:20:01,800 Speaker 11: It very much depends on the industry. Talking about goods 396 00:20:01,800 --> 00:20:06,639 Speaker 11: related industries like retail, transportation, and warehousing, workers there have 397 00:20:06,720 --> 00:20:09,520 Speaker 11: seen a large decline in their leverage, and that's because 398 00:20:09,560 --> 00:20:12,520 Speaker 11: consumers are shifting their spending back from goods to services. 399 00:20:12,960 --> 00:20:15,879 Speaker 11: Tech is still a glaring weak spot in this economy, 400 00:20:16,200 --> 00:20:19,320 Speaker 11: with far fewer quits than before the pandemic and more 401 00:20:19,400 --> 00:20:20,880 Speaker 11: layoffs than before the pandemic. 402 00:20:21,320 --> 00:20:22,719 Speaker 4: Can I talk to you a little bit about your 403 00:20:22,760 --> 00:20:26,359 Speaker 4: new higher survey that you include in your note here. 404 00:20:27,160 --> 00:20:30,520 Speaker 4: I love talking about employees ghosting their employers. 405 00:20:30,520 --> 00:20:31,480 Speaker 3: Do you know about this, John? 406 00:20:32,520 --> 00:20:34,800 Speaker 6: All the time there's an increase. 407 00:20:34,240 --> 00:20:38,960 Speaker 4: I'm sure you do, increase in employees ghosting potential employers 408 00:20:39,280 --> 00:20:42,760 Speaker 4: after getting job offers. Julia, what do you make of that? 409 00:20:42,920 --> 00:20:45,959 Speaker 4: And how widespread is this starting to get? 410 00:20:46,920 --> 00:20:47,040 Speaker 7: So? 411 00:20:47,119 --> 00:20:50,760 Speaker 11: In this survey of two thousand recently hired Americans, I mean, 412 00:20:50,800 --> 00:20:54,320 Speaker 11: there's still plenty of sign that workers are confident and 413 00:20:54,600 --> 00:20:58,320 Speaker 11: that they are they have a lot of leverage so 414 00:20:58,440 --> 00:21:00,840 Speaker 11: much so that they don't need to behave well necessarily 415 00:21:01,560 --> 00:21:07,520 Speaker 11: they are, yes, exactly. They're still getting pretty big wage increases, 416 00:21:07,560 --> 00:21:11,200 Speaker 11: they're still getting attractive offers, and they're still finding jobs 417 00:21:11,280 --> 00:21:13,919 Speaker 11: very quickly. And the other thing that they're seeing is 418 00:21:13,960 --> 00:21:19,240 Speaker 11: that companies have made huge improvements in their recruiting and 419 00:21:19,320 --> 00:21:22,800 Speaker 11: hiring processes since the pandemic. They have made those far 420 00:21:22,880 --> 00:21:27,320 Speaker 11: more mobile friendly. They've also adopted more automated tools. That's 421 00:21:27,359 --> 00:21:30,679 Speaker 11: the likely explanation for the increase in the share of 422 00:21:30,760 --> 00:21:34,240 Speaker 11: workers who are getting very quick responses to their applications. 423 00:21:34,440 --> 00:21:37,120 Speaker 11: I think many companies have automated that system and tell 424 00:21:37,160 --> 00:21:39,720 Speaker 11: people right away whether they're likely to get a job 425 00:21:40,600 --> 00:21:41,160 Speaker 11: real quick. 426 00:21:41,320 --> 00:21:44,000 Speaker 6: Can they still work from home or is that changing. 427 00:21:45,240 --> 00:21:48,760 Speaker 11: Work from home has stabilized it? Around twenty eight percent 428 00:21:48,800 --> 00:21:51,200 Speaker 11: of all worked days in America, up from five percent 429 00:21:51,240 --> 00:21:54,040 Speaker 11: before the pandemic. There are industries where you are seeing 430 00:21:54,040 --> 00:21:56,639 Speaker 11: a bit of a pullback now, but on the whole 431 00:21:57,200 --> 00:21:58,840 Speaker 11: it's still very very steady. 432 00:21:59,280 --> 00:22:01,320 Speaker 4: Yeah, And really I just want to mention, because we 433 00:22:01,359 --> 00:22:04,080 Speaker 4: have to leave it. Their job seekers look like in 434 00:22:04,119 --> 00:22:07,360 Speaker 4: your survey, they're becoming more pessimistic across the board about 435 00:22:07,440 --> 00:22:11,280 Speaker 4: current labor market conditions and the medium term economic outlook, 436 00:22:11,600 --> 00:22:14,800 Speaker 4: which is certainly something that I feel myself and amongst 437 00:22:14,840 --> 00:22:17,480 Speaker 4: my friends here. Julia Pollock, thank you so much for 438 00:22:17,600 --> 00:22:18,080 Speaker 4: joining us. 439 00:22:18,080 --> 00:22:20,880 Speaker 3: That was a great conversation. Oh my god, of course 440 00:22:20,920 --> 00:22:22,399 Speaker 3: I am. 441 00:22:22,720 --> 00:22:26,560 Speaker 8: You're listening to the Team Can't Live program Bloomberg Markets 442 00:22:26,600 --> 00:22:29,680 Speaker 8: weekdays at ten am Eastern on Bloomberg dot com, the 443 00:22:29,800 --> 00:22:32,879 Speaker 8: iHeartRadio app, and the Bloomberg Business app, or listen on 444 00:22:32,960 --> 00:22:34,960 Speaker 8: demand wherever you get your podcasts. 445 00:22:36,880 --> 00:22:38,280 Speaker 4: We are going to get back to some of that 446 00:22:38,440 --> 00:22:41,320 Speaker 4: job's data from today, and on the line, we've got 447 00:22:41,320 --> 00:22:44,960 Speaker 4: a really fantastic voice on this. We've got Jeffrey Cleveland 448 00:22:45,000 --> 00:22:48,159 Speaker 4: here to discuss the jobs market numbers and also what 449 00:22:48,200 --> 00:22:51,520 Speaker 4: we're seeing in terms of moves from the bond market 450 00:22:51,560 --> 00:22:53,520 Speaker 4: off of that news as well. Jeffrey, thank you so 451 00:22:53,640 --> 00:22:56,760 Speaker 4: much for joining us to talk about what. 452 00:22:56,760 --> 00:22:58,240 Speaker 3: We're seeing here in the market. 453 00:22:58,320 --> 00:23:01,840 Speaker 4: I mean, when you look at this June jobs report, 454 00:23:02,359 --> 00:23:05,360 Speaker 4: it feels like some good news this morning. If you're 455 00:23:05,400 --> 00:23:07,840 Speaker 4: the Fed, bad news yesterday when it came to that 456 00:23:07,920 --> 00:23:11,119 Speaker 4: ie popping ADP number. Talk to me about where you 457 00:23:11,240 --> 00:23:14,880 Speaker 4: think our economy sits when you're looking at the totality 458 00:23:14,960 --> 00:23:17,000 Speaker 4: of that job's data. 459 00:23:17,160 --> 00:23:19,720 Speaker 10: Well, I think the context matters, you know, when you 460 00:23:19,760 --> 00:23:22,399 Speaker 10: look at each report that comes out every month, and 461 00:23:23,080 --> 00:23:25,440 Speaker 10: if you I talked to a lot of economic bears, 462 00:23:25,800 --> 00:23:29,800 Speaker 10: they're my favorite species of market participants in you know, 463 00:23:29,840 --> 00:23:32,600 Speaker 10: they were telling me last month, Hey, you have to 464 00:23:32,640 --> 00:23:35,879 Speaker 10: look at the household survey it was negative. You have 465 00:23:35,960 --> 00:23:38,480 Speaker 10: to look at ours worked. You know, it had ticked down, 466 00:23:39,280 --> 00:23:42,320 Speaker 10: and you know, so lo and behold, we had I 467 00:23:42,400 --> 00:23:44,480 Speaker 10: think a decent non farm payroll number, two hundred and 468 00:23:44,520 --> 00:23:48,399 Speaker 10: nine thousand. We had the household survey component of that 469 00:23:48,520 --> 00:23:50,800 Speaker 10: bouncing back, so that was up two hundred and seventy 470 00:23:50,840 --> 00:23:54,800 Speaker 10: three thousand, hours worked ticked up, and then average hourly 471 00:23:54,840 --> 00:23:58,119 Speaker 10: earnings another point four month to month print. So I 472 00:23:58,119 --> 00:24:00,199 Speaker 10: think you have to look at that full context and 473 00:24:00,240 --> 00:24:03,359 Speaker 10: it's it's a pretty solid report in my view. It 474 00:24:03,400 --> 00:24:06,359 Speaker 10: doesn't tell us, you know, maybe the job growth is 475 00:24:06,400 --> 00:24:11,120 Speaker 10: slowing a bit, bought nothing close to a recession, and 476 00:24:11,480 --> 00:24:13,440 Speaker 10: I even hesitate to call slow. And I mean, we're 477 00:24:13,440 --> 00:24:16,119 Speaker 10: still adding over two hundred thousand jobs in the latest number. 478 00:24:16,600 --> 00:24:19,640 Speaker 10: That three month average of non farm payroll still two 479 00:24:19,680 --> 00:24:23,560 Speaker 10: forty two fifty k. It's really solid. We only need 480 00:24:23,600 --> 00:24:25,520 Speaker 10: like one hundred thousand jobs per month just to keep 481 00:24:25,520 --> 00:24:27,720 Speaker 10: the unemployment rate where it is, So if you're getting 482 00:24:27,720 --> 00:24:30,120 Speaker 10: over two hundred thousand, it's a it's pretty good. 483 00:24:30,040 --> 00:24:31,760 Speaker 6: All right. So what does it tell us about the 484 00:24:31,800 --> 00:24:33,440 Speaker 6: stickiness of inflation. 485 00:24:34,760 --> 00:24:37,159 Speaker 10: Well, I think if you're a policy maker, you're going 486 00:24:37,240 --> 00:24:39,200 Speaker 10: to look at two things here. You're gonna look at 487 00:24:39,240 --> 00:24:43,159 Speaker 10: that three point six percent unemployment rate, and you're going 488 00:24:43,240 --> 00:24:47,320 Speaker 10: to conclude that the risks are still toward inflation pressure. 489 00:24:47,920 --> 00:24:50,720 Speaker 10: That's an unemployment rate that's very low. So we have 490 00:24:50,920 --> 00:24:55,040 Speaker 10: very tight labor markets. I think you heard Powell last 491 00:24:55,040 --> 00:24:57,159 Speaker 10: week he said the goal for the Fed was to 492 00:24:57,200 --> 00:25:02,239 Speaker 10: get the labor market in better supply demand balance. And 493 00:25:02,400 --> 00:25:06,520 Speaker 10: three point six percent on employer rate, it's really tight conditions. 494 00:25:06,760 --> 00:25:08,240 Speaker 10: And then the second thing you'd look at, I think 495 00:25:08,240 --> 00:25:11,399 Speaker 10: would be average hourly earnings again zero point four percent 496 00:25:11,520 --> 00:25:14,239 Speaker 10: month to month. So I've been hearing from the lot 497 00:25:14,320 --> 00:25:16,720 Speaker 10: of the bears they oh, job growth is going to 498 00:25:16,800 --> 00:25:18,840 Speaker 10: roll over, and also ways growth is going to roll 499 00:25:18,840 --> 00:25:22,280 Speaker 10: over any second now, and that's just not happening. It's 500 00:25:22,320 --> 00:25:25,080 Speaker 10: not playing out here. So I think this keeps the 501 00:25:25,080 --> 00:25:28,040 Speaker 10: FED on track to hike we think they will hike 502 00:25:28,320 --> 00:25:31,120 Speaker 10: in July at the July meeting, and we think they're 503 00:25:31,119 --> 00:25:33,520 Speaker 10: on in every other meeting hiking pace right now, So 504 00:25:33,560 --> 00:25:36,760 Speaker 10: that would imply skipping September and hiking again in November. 505 00:25:36,760 --> 00:25:39,320 Speaker 10: So we get the five fifty by year end on 506 00:25:39,400 --> 00:25:40,040 Speaker 10: FED funds. 507 00:25:40,240 --> 00:25:43,040 Speaker 4: What's so interesting to me is that the data and 508 00:25:43,119 --> 00:25:45,280 Speaker 4: the FED moves and the market moves are all over 509 00:25:45,320 --> 00:25:49,000 Speaker 4: the place, but also the vibes of us regular folks 510 00:25:49,000 --> 00:25:51,160 Speaker 4: out in the world. We just talked with an economist 511 00:25:51,160 --> 00:25:53,200 Speaker 4: from Zip Recruiter who talk to us about how the 512 00:25:53,240 --> 00:25:57,880 Speaker 4: majority of job seekers are feeling this pinch of market 513 00:25:57,880 --> 00:26:01,400 Speaker 4: conditions and they feel that they should take the first 514 00:26:01,480 --> 00:26:04,720 Speaker 4: job that they're offered because they're so concerned with the economy. 515 00:26:05,119 --> 00:26:08,920 Speaker 4: From where you sit, Jeffrey, does that square with what's 516 00:26:09,080 --> 00:26:10,119 Speaker 4: actually going. 517 00:26:09,840 --> 00:26:11,160 Speaker 3: To happen in the economy? 518 00:26:11,160 --> 00:26:14,120 Speaker 4: And what do you make of the feeling of anxiety 519 00:26:14,359 --> 00:26:17,120 Speaker 4: with American workers given that we continue to get these 520 00:26:17,119 --> 00:26:18,159 Speaker 4: great jobs numbers. 521 00:26:18,880 --> 00:26:22,000 Speaker 10: Well, just talking to friends and family, we're being constantly 522 00:26:22,000 --> 00:26:24,159 Speaker 10: told that the recession is going to start imminently, right, 523 00:26:24,160 --> 00:26:26,520 Speaker 10: It's going to be dead next week, next month. We've 524 00:26:26,520 --> 00:26:28,840 Speaker 10: been hearing that for a better part of a year 525 00:26:28,880 --> 00:26:31,560 Speaker 10: now really since last June. So if that is what 526 00:26:31,600 --> 00:26:34,080 Speaker 10: the average person is hearing, I can understand a little 527 00:26:34,080 --> 00:26:37,879 Speaker 10: bit of consternation. The data, though the macro data doesn't 528 00:26:37,880 --> 00:26:40,679 Speaker 10: really bear that out. I mean, in terms of labor demand, 529 00:26:40,760 --> 00:26:44,040 Speaker 10: still very very high job openings hanging out around ten million, 530 00:26:45,080 --> 00:26:48,440 Speaker 10: so we're still seeing pretty good labor demand. Now. It's 531 00:26:48,520 --> 00:26:50,840 Speaker 10: down from the peak where we had extreme amount of 532 00:26:50,880 --> 00:26:54,280 Speaker 10: labor demand, but it's still high relative to other cycles, 533 00:26:54,560 --> 00:26:56,879 Speaker 10: so I still think it's a pretty good time to 534 00:26:56,960 --> 00:26:58,800 Speaker 10: be in the market looking for a job. I think 535 00:26:58,840 --> 00:27:02,399 Speaker 10: we also saw that the quits data tick back up. 536 00:27:02,600 --> 00:27:04,760 Speaker 10: Yeah for May. Yeah, we saw that that was the 537 00:27:04,800 --> 00:27:07,520 Speaker 10: paidon and regal chart of the week. If anyone was 538 00:27:07,560 --> 00:27:10,679 Speaker 10: interested in checking that out. We just compared quits you know, 539 00:27:10,760 --> 00:27:13,679 Speaker 10: this cycle are still well above what we saw at 540 00:27:13,680 --> 00:27:17,040 Speaker 10: any point really in the twenty tenths. So I still 541 00:27:17,040 --> 00:27:20,000 Speaker 10: think it's a better environment now, and that's good news 542 00:27:19,840 --> 00:27:21,480 Speaker 10: for someone who's looking for a job or was in 543 00:27:21,480 --> 00:27:23,760 Speaker 10: the labor market. It's better environments than it was for 544 00:27:23,920 --> 00:27:25,600 Speaker 10: much of the twenty tenths, so that's good. 545 00:27:25,800 --> 00:27:27,399 Speaker 6: I don't want to get too geeky, but there was 546 00:27:27,400 --> 00:27:30,960 Speaker 6: an account of as Rudy dorm Bush. Among other things, 547 00:27:31,359 --> 00:27:35,000 Speaker 6: he said that when things turn, they turn pretty quickly. 548 00:27:35,160 --> 00:27:36,119 Speaker 6: Do you get a sense of that. 549 00:27:37,160 --> 00:27:40,040 Speaker 10: Yeah. We always say, like the unemployment rate is a 550 00:27:40,040 --> 00:27:42,880 Speaker 10: good example of this. It falls like a feather and 551 00:27:42,920 --> 00:27:47,520 Speaker 10: it rises like a rocket. So you can see looking 552 00:27:47,560 --> 00:27:50,800 Speaker 10: at the unemployment rate chart that exact story. So that's 553 00:27:50,840 --> 00:27:53,439 Speaker 10: why we're always on guard looking at things just for 554 00:27:53,520 --> 00:27:56,800 Speaker 10: the early hints, in the early signs, you know, initial 555 00:27:56,840 --> 00:27:59,480 Speaker 10: claims for unemployment. That weekly data that comes out tends 556 00:27:59,520 --> 00:28:02,280 Speaker 10: to be a pretty good but you know sign an 557 00:28:02,280 --> 00:28:05,520 Speaker 10: indicator of that. It ticked up recently, but it's been 558 00:28:05,560 --> 00:28:07,320 Speaker 10: hanging out. I would say for the last three or 559 00:28:07,359 --> 00:28:09,840 Speaker 10: four months, around two hundred and forty thousand in the 560 00:28:09,840 --> 00:28:10,880 Speaker 10: weekly claims data. 561 00:28:11,000 --> 00:28:12,600 Speaker 3: So it's moved up. 562 00:28:12,640 --> 00:28:15,560 Speaker 10: It's indicative of a slower job growth, but it's it's 563 00:28:15,600 --> 00:28:18,960 Speaker 10: nothing worrisome. I don't I don't think. I also think payrolls. 564 00:28:19,520 --> 00:28:22,040 Speaker 10: He gets a lot of pushback and people say, oh, 565 00:28:22,040 --> 00:28:25,280 Speaker 10: it's a lagging indicator. But in real time, we're getting 566 00:28:25,359 --> 00:28:29,280 Speaker 10: data for last month, for June, we're getting it released here, 567 00:28:29,320 --> 00:28:31,840 Speaker 10: you know, seven days into the month. It's pretty good 568 00:28:31,880 --> 00:28:35,600 Speaker 10: real time indicator from me from a bond market economist perspective, 569 00:28:35,680 --> 00:28:39,200 Speaker 10: always have relied on that, and as I started this segment, 570 00:28:39,400 --> 00:28:42,280 Speaker 10: two hundred and forty four thousand, the three month moving 571 00:28:42,280 --> 00:28:44,880 Speaker 10: average of non payroll growth, it's a pretty good indicator 572 00:28:44,880 --> 00:28:47,400 Speaker 10: of where we are. It's it's slowed down, so growth 573 00:28:47,440 --> 00:28:50,200 Speaker 10: has slowed from a year ago, six months ago, but 574 00:28:50,800 --> 00:28:52,600 Speaker 10: still very solid job growth. 575 00:28:52,760 --> 00:28:55,360 Speaker 6: So you're a bond market he's a bond market economist. 576 00:28:55,400 --> 00:28:57,360 Speaker 6: So that means you are a pessimist, is it not. 577 00:28:58,160 --> 00:28:59,840 Speaker 10: I'm supposed to be. Yeah, I'm supposed to be out 578 00:28:59,840 --> 00:29:02,480 Speaker 10: here telling you that, you know, inflation is rolling over, 579 00:29:02,600 --> 00:29:05,880 Speaker 10: it's time to buy bonds, you know, exten duration. But 580 00:29:06,280 --> 00:29:08,400 Speaker 10: I would like to think that I'm objective. I'm just 581 00:29:08,440 --> 00:29:11,160 Speaker 10: looking at the data here. Yeah, we're very far from 582 00:29:11,200 --> 00:29:14,160 Speaker 10: the Fed's target on inflation. Yeah, the unemployment rate is 583 00:29:14,320 --> 00:29:17,520 Speaker 10: very low, and I think their bias from policy makers 584 00:29:17,640 --> 00:29:19,080 Speaker 10: is going to be to keep hiking, So that's going 585 00:29:19,160 --> 00:29:22,360 Speaker 10: to keep putting pressure on front end yields. So you're too. 586 00:29:22,480 --> 00:29:24,520 Speaker 10: You know, yesterday we did see two year yields creep 587 00:29:24,560 --> 00:29:27,800 Speaker 10: above five percent, which makes sense to me. We're back 588 00:29:27,840 --> 00:29:31,120 Speaker 10: below this morning. I think we'll move back above. At 589 00:29:31,200 --> 00:29:33,959 Speaker 10: some point, the Fed's got two more rate hikes. 590 00:29:33,640 --> 00:29:35,400 Speaker 3: That's the gott. 591 00:29:35,200 --> 00:29:37,360 Speaker 10: To face the facts here. So that's what bond market 592 00:29:37,400 --> 00:29:39,720 Speaker 10: participants have to face those facts. Don't fight the Fed. 593 00:29:39,880 --> 00:29:41,480 Speaker 4: Okay, well, since you brought it up, I got to 594 00:29:41,520 --> 00:29:43,320 Speaker 4: talk to you about the yield curve because we are 595 00:29:43,400 --> 00:29:45,440 Speaker 4: seeing a little bit of a moderation when it comes 596 00:29:45,440 --> 00:29:50,000 Speaker 4: to the twos tens inversion. Are you thinking that the 597 00:29:50,080 --> 00:29:53,680 Speaker 4: bond market is seeing something that the Fed isn't when 598 00:29:53,680 --> 00:29:55,680 Speaker 4: it comes to where this economy is going. 599 00:29:56,680 --> 00:29:58,440 Speaker 10: Go talk to our traders on the trading floor. They 600 00:29:58,440 --> 00:30:01,959 Speaker 10: would tell you, yes, the bond market, bond investors are smart. 601 00:30:03,600 --> 00:30:05,800 Speaker 10: Maybe they are, But you think about the yield curve. 602 00:30:06,200 --> 00:30:08,120 Speaker 10: I've always I've always loved looking at the yeld curve, 603 00:30:08,160 --> 00:30:10,640 Speaker 10: but it can have long lags to when it actually 604 00:30:10,680 --> 00:30:14,120 Speaker 10: signals a downturn. So I remember this very well. If 605 00:30:14,120 --> 00:30:16,720 Speaker 10: you go back to say the two thousand and six era, 606 00:30:17,240 --> 00:30:19,200 Speaker 10: if you're looking at the yield curve, you started to 607 00:30:19,200 --> 00:30:22,560 Speaker 10: get concerned, but the recession didn't begin until end of seven. 608 00:30:22,960 --> 00:30:25,840 Speaker 10: So people tend to go early if they just focus 609 00:30:25,880 --> 00:30:28,080 Speaker 10: on the yield curve. So that's the thing. It could 610 00:30:28,080 --> 00:30:30,440 Speaker 10: be long lags. Not to ignore the yield curve. You 611 00:30:30,480 --> 00:30:32,520 Speaker 10: got to look at there's information there, but it could 612 00:30:32,520 --> 00:30:35,720 Speaker 10: be long lags. I also think there's some unique features 613 00:30:35,720 --> 00:30:38,280 Speaker 10: this time. I mean, inflation is higher than it has 614 00:30:38,320 --> 00:30:40,360 Speaker 10: been at any time really in the last forty years. 615 00:30:40,840 --> 00:30:44,000 Speaker 10: So in typical business cycles, you haven't really had to 616 00:30:44,200 --> 00:30:46,080 Speaker 10: think about, well, what's going on in the front end. 617 00:30:46,080 --> 00:30:48,040 Speaker 10: Why is the front end so high? The front end 618 00:30:48,080 --> 00:30:50,240 Speaker 10: is high and yield because the FED is trying to 619 00:30:50,280 --> 00:30:53,840 Speaker 10: stamp out inflation. I think the bond market has a 620 00:30:53,840 --> 00:30:57,000 Speaker 10: bit different forecast for inflation than we do. The bond 621 00:30:57,040 --> 00:30:59,840 Speaker 10: market has been perpetually expecting inflation to come down much 622 00:30:59,840 --> 00:31:02,520 Speaker 10: more quickly, and so maybe that's the reason why five 623 00:31:02,600 --> 00:31:05,040 Speaker 10: year yels and ten year yields have been a bit lower. 624 00:31:05,600 --> 00:31:07,400 Speaker 10: So as you, as you pointed out in the last 625 00:31:07,520 --> 00:31:10,000 Speaker 10: day or so, the long end even moved up, and 626 00:31:10,080 --> 00:31:12,640 Speaker 10: I think, yeah, yeah, I think that's a recognition of 627 00:31:12,680 --> 00:31:16,320 Speaker 10: the fact that, hey, things are you know, the economy 628 00:31:16,360 --> 00:31:19,400 Speaker 10: is in better shape. We're not getting that recession everyone advertised. 629 00:31:19,760 --> 00:31:22,520 Speaker 10: Inflation is a bit more sticky. The FED is going 630 00:31:22,600 --> 00:31:24,880 Speaker 10: to be higher and maybe higher for longer, and that 631 00:31:24,920 --> 00:31:27,960 Speaker 10: does tend to have some impact on five intentions and. 632 00:31:28,480 --> 00:31:29,719 Speaker 3: Maybe a soft landing. 633 00:31:29,800 --> 00:31:33,040 Speaker 10: You think, yeah, you know, this morning, one of my 634 00:31:33,080 --> 00:31:35,200 Speaker 10: colleagues ping me. He said, oh, this is goldilocks, this 635 00:31:35,280 --> 00:31:37,959 Speaker 10: is this is a soft landing report. We've got a 636 00:31:38,080 --> 00:31:40,720 Speaker 10: very low unemployment, we've got a little bit of a 637 00:31:40,720 --> 00:31:44,040 Speaker 10: slowdown in job growth, so it's possible. We wrote a 638 00:31:44,040 --> 00:31:45,800 Speaker 10: piece at the beginning of the year, you know, we 639 00:31:45,840 --> 00:31:48,640 Speaker 10: said we said it's the case for a soft landing. 640 00:31:49,080 --> 00:31:51,520 Speaker 10: It may not be the base case, but something everyone 641 00:31:51,520 --> 00:31:56,240 Speaker 10: should think about. So we're we're leaning towards that. What 642 00:31:56,880 --> 00:31:58,880 Speaker 10: in this I don't think was really a soft landing 643 00:31:58,960 --> 00:32:01,320 Speaker 10: was probably the average early earnings because that's still coming 644 00:32:01,360 --> 00:32:04,440 Speaker 10: in a little bit hot. But remember the unemployment rate 645 00:32:04,480 --> 00:32:09,120 Speaker 10: stays low as job openings come down, that's your soft landing. 646 00:32:09,160 --> 00:32:12,360 Speaker 10: That's your You think about the the beverage curve kind 647 00:32:12,360 --> 00:32:15,800 Speaker 10: of relationship. You get, you get an easing of labor 648 00:32:15,840 --> 00:32:20,040 Speaker 10: demand and the unemployment rate doesn't rise, that's your soft landing. 649 00:32:20,080 --> 00:32:22,680 Speaker 10: So it's it's possible. With a three point six unemployment rate, 650 00:32:22,720 --> 00:32:24,920 Speaker 10: we're on we're on track for it. I wouldn't rule 651 00:32:24,960 --> 00:32:25,240 Speaker 10: it out. 652 00:32:26,040 --> 00:32:28,640 Speaker 6: Keep in mind, Madison, the Goldilocks story that had three 653 00:32:28,720 --> 00:32:33,160 Speaker 6: bears in it. Wow, where are you? Because we got 654 00:32:33,200 --> 00:32:36,920 Speaker 6: like twenty seconds left. Because I'm interested in anecdotal you know, 655 00:32:37,000 --> 00:32:39,120 Speaker 6: what's the local economy there? I'm looking out the window. 656 00:32:39,160 --> 00:32:39,640 Speaker 6: Where are you? 657 00:32:40,080 --> 00:32:41,400 Speaker 10: This is downtown LA. I don't know. If you can 658 00:32:41,400 --> 00:32:43,440 Speaker 10: see the background, you can probably see the Hollywood signs. 659 00:32:43,520 --> 00:32:47,080 Speaker 10: So we are where paid in Rigel is located. That Actually, 660 00:32:47,080 --> 00:32:49,040 Speaker 10: if you want to be bearish, if you want to 661 00:32:49,080 --> 00:32:50,920 Speaker 10: be bearish, the story that I would tell is I 662 00:32:50,960 --> 00:32:53,080 Speaker 10: would say, hey, look at the un the plot on 663 00:32:53,080 --> 00:32:56,440 Speaker 10: your Bloomberg terminal, the California and unemployment rate. It's bottomed 664 00:32:56,440 --> 00:32:58,360 Speaker 10: out about a year ago at three point nine. It's 665 00:32:58,400 --> 00:33:01,640 Speaker 10: at four point five right now, so it's risen point 666 00:33:01,680 --> 00:33:05,640 Speaker 10: six percentage points, while you know, the unemployment rate nationwide 667 00:33:05,720 --> 00:33:06,040 Speaker 10: is low. 668 00:33:06,120 --> 00:33:06,600 Speaker 6: Got to run. 669 00:33:07,520 --> 00:33:09,280 Speaker 10: California's a big economy, so that's all. 670 00:33:09,320 --> 00:33:10,960 Speaker 3: That's the best fourth largest there. 671 00:33:11,040 --> 00:33:14,280 Speaker 4: Jeffrey Cleveland, director and chief economist at Pagan Regal, Thank. 672 00:33:14,120 --> 00:33:14,720 Speaker 3: You so much. 673 00:33:15,200 --> 00:33:18,320 Speaker 8: You're listening to the tape. Catch are live program Bloomberg 674 00:33:18,400 --> 00:33:22,000 Speaker 8: Markets weekdays at ten am Eastern on Bloomberg Radio, the 675 00:33:22,040 --> 00:33:25,280 Speaker 8: tune in app, Bloomberg dot com, and the Bloomberg Business app. 676 00:33:25,320 --> 00:33:28,120 Speaker 8: You can also listen live on Amazon Alexa from our 677 00:33:28,160 --> 00:33:33,120 Speaker 8: flagship New York station. Just say Alexa play Bloomberg eleven thirty. 678 00:33:34,160 --> 00:33:36,360 Speaker 4: This is very exciting stuff. Me and my friends are 679 00:33:36,360 --> 00:33:38,960 Speaker 4: all really pumped. I know that you'll you'll be joining 680 00:33:39,000 --> 00:33:41,200 Speaker 4: us at the theater John, for the new Barbie movie. 681 00:33:41,440 --> 00:33:43,400 Speaker 4: One of the reasons we're so pumped is because of 682 00:33:43,400 --> 00:33:47,400 Speaker 4: the amount of money getting poured into branding for the film. 683 00:33:47,480 --> 00:33:48,800 Speaker 3: So we're going to talk about all of this. 684 00:33:49,440 --> 00:33:52,400 Speaker 4: It's today's big Take story, and we've got Kelly Gilblam 685 00:33:52,440 --> 00:33:55,400 Speaker 4: on the line, our Bloomberg News editor out in LA, 686 00:33:55,520 --> 00:33:56,360 Speaker 4: to discuss it with us. 687 00:33:56,440 --> 00:34:00,000 Speaker 3: Kelly, thanks for being patient with us as we Is this. 688 00:34:00,160 --> 00:34:04,400 Speaker 6: A kid movie or an adult I mean for older 689 00:34:04,440 --> 00:34:05,680 Speaker 6: people adult? 690 00:34:05,920 --> 00:34:09,640 Speaker 7: Yeah, thank you for your interest in Barbie. It's actually 691 00:34:09,680 --> 00:34:14,200 Speaker 7: not really a kid movie. It's rated PG thirteen. If 692 00:34:14,200 --> 00:34:16,120 Speaker 7: you've seen the trailer, you can see that it has 693 00:34:16,160 --> 00:34:18,560 Speaker 7: a lot of sexual innuindow and. 694 00:34:18,800 --> 00:34:21,080 Speaker 6: So it's not creepy. If Charlie goes to see it. 695 00:34:21,040 --> 00:34:23,560 Speaker 3: By himself, John, it's it's for adults. 696 00:34:24,120 --> 00:34:27,040 Speaker 4: It's for adults well, and it was very expensive to 697 00:34:27,120 --> 00:34:31,640 Speaker 4: make and so it's it's a big bet on those 698 00:34:31,680 --> 00:34:33,800 Speaker 4: adults coming in to buy tickets, right, Kelly. 699 00:34:34,840 --> 00:34:36,880 Speaker 7: Yeah, it was very expensive to make. It was one 700 00:34:36,920 --> 00:34:41,360 Speaker 7: hundred million dollars. Mattel, which owns the Barbie brand, didn't 701 00:34:41,360 --> 00:34:43,920 Speaker 7: actually pay for the budget. It licensed the brand to 702 00:34:44,040 --> 00:34:47,600 Speaker 7: Warner Brothers, which covered the budget. But Mattel is definitely 703 00:34:47,640 --> 00:34:51,000 Speaker 7: taking a big bet for itself on the overall perception 704 00:34:51,280 --> 00:34:55,000 Speaker 7: of the brand. If you, you know, recall hearing about 705 00:34:55,040 --> 00:34:57,920 Speaker 7: Barbie dolls at any point in your life, they can 706 00:34:57,920 --> 00:35:02,200 Speaker 7: be pretty controversial. So so they're really hoping that people 707 00:35:02,239 --> 00:35:05,480 Speaker 7: are more endeared to them after this movie comes out. 708 00:35:06,200 --> 00:35:09,600 Speaker 3: Yeah. Well, and also it's interesting. 709 00:35:09,160 --> 00:35:12,799 Speaker 4: Because they have a tough challenge with the Barbie kind 710 00:35:12,840 --> 00:35:15,839 Speaker 4: of stereotype that they have to sort of rebrand as 711 00:35:16,080 --> 00:35:18,320 Speaker 4: like a new age feminist character. 712 00:35:18,960 --> 00:35:22,759 Speaker 3: What can you tell us, Kelly about the likelihood of 713 00:35:23,080 --> 00:35:24,600 Speaker 3: Warner Brothers being able to do that? 714 00:35:26,239 --> 00:35:30,080 Speaker 7: It seems like from the response so far, they've mostly 715 00:35:30,160 --> 00:35:32,920 Speaker 7: managed to pull it off. It's gone Everything about it 716 00:35:32,920 --> 00:35:35,960 Speaker 7: has gone viral. People are so excited. The box office 717 00:35:36,000 --> 00:35:39,839 Speaker 7: tracking figures keep going higher and higher and higher, and 718 00:35:40,040 --> 00:35:44,160 Speaker 7: it's one of the rare movies that's actually targeted toward women. 719 00:35:44,560 --> 00:35:48,440 Speaker 7: You know, we calculated only like six percent of movies 720 00:35:48,480 --> 00:35:52,719 Speaker 7: with this type of budget are for women. So I 721 00:35:52,800 --> 00:35:55,000 Speaker 7: do think it will it will make a big impact 722 00:35:55,320 --> 00:35:59,640 Speaker 7: and could possibly pull off this reputational move that they're 723 00:35:59,680 --> 00:36:00,319 Speaker 7: trying to make. 724 00:36:00,680 --> 00:36:03,400 Speaker 6: The story is great, I mean, it's the history of 725 00:36:03,440 --> 00:36:06,239 Speaker 6: this is fascinating, well to the extent that it can 726 00:36:06,280 --> 00:36:09,040 Speaker 6: be fascinating to somebody like me. But there's actually the 727 00:36:09,560 --> 00:36:13,560 Speaker 6: Barbie and Ken are actually named for the founders of Mattel, 728 00:36:13,719 --> 00:36:14,600 Speaker 6: their kids. 729 00:36:14,360 --> 00:36:18,360 Speaker 7: Right, that's right. Yeah, Ruth Handler was the inventor of 730 00:36:18,440 --> 00:36:20,680 Speaker 7: Barbie and one of the founders of Mattel. It's a 731 00:36:20,719 --> 00:36:26,240 Speaker 7: long time chief executive officer, control of operations, in control 732 00:36:26,280 --> 00:36:30,840 Speaker 7: of operations there. And yeah, she saw a German doll 733 00:36:30,960 --> 00:36:33,000 Speaker 7: that was actually for adults. 734 00:36:33,400 --> 00:36:36,560 Speaker 6: Oh, let's be clear. This is a German sex doll 735 00:36:36,719 --> 00:36:39,160 Speaker 6: on which Barbie is based, right. 736 00:36:39,320 --> 00:36:43,080 Speaker 7: Do I have? I mean it was for bachelor parties people, 737 00:36:43,239 --> 00:36:45,279 Speaker 7: you know, sent it around as a gag gift, and 738 00:36:45,560 --> 00:36:48,080 Speaker 7: she thought it would be great for you know, if 739 00:36:48,080 --> 00:36:51,800 Speaker 7: she kind of remade it more targeted for kids, would 740 00:36:51,800 --> 00:36:54,200 Speaker 7: be great for her daughter, Barbara. And then a few 741 00:36:54,280 --> 00:36:55,800 Speaker 7: years later Ken rolled out. 742 00:36:56,719 --> 00:37:02,080 Speaker 4: Yeah, and Ken her brother either way, right right, right, 743 00:37:02,200 --> 00:37:06,240 Speaker 4: very you always bring us the fun facts here, John. 744 00:37:06,280 --> 00:37:10,400 Speaker 4: I also feel like Kelly Greta Gerwig as the director 745 00:37:10,440 --> 00:37:13,600 Speaker 4: here is an important choice because she has kind of 746 00:37:13,600 --> 00:37:17,320 Speaker 4: a history of making these inclusive films that center female 747 00:37:17,440 --> 00:37:19,360 Speaker 4: characters as the main subject. 748 00:37:20,480 --> 00:37:20,719 Speaker 8: Yeah. 749 00:37:20,800 --> 00:37:24,080 Speaker 7: I think she's one of the pre eminent female you know, 750 00:37:24,200 --> 00:37:28,960 Speaker 7: coming of age genre directors writers. She's come to prominence 751 00:37:29,000 --> 00:37:33,399 Speaker 7: in recent years, especially with Little Women her remake, and 752 00:37:33,600 --> 00:37:37,839 Speaker 7: with Lady Bird, both Oscar nominated films. I think one 753 00:37:37,880 --> 00:37:42,239 Speaker 7: actually won an Oscar, so that was a big, a 754 00:37:42,280 --> 00:37:45,200 Speaker 7: big get for them, and that was it was actually 755 00:37:45,280 --> 00:37:48,799 Speaker 7: Margot Robbie who's playing Barbie, who was able to make 756 00:37:48,840 --> 00:37:51,920 Speaker 7: that connection and recommended her as a screenwriter. 757 00:37:52,080 --> 00:37:54,200 Speaker 3: Oh cool, I didn't know that. That's really cool. 758 00:37:54,480 --> 00:37:58,520 Speaker 6: Now is Barbie? What does this do for Barbie? This film? 759 00:37:58,680 --> 00:38:02,200 Speaker 6: If it's a flop, does Mattil get crushed? Is Barbie 760 00:38:02,280 --> 00:38:03,480 Speaker 6: even relevant anymore? 761 00:38:05,200 --> 00:38:08,600 Speaker 7: I think that's the big question for Mattel is how 762 00:38:08,680 --> 00:38:11,320 Speaker 7: relevant is Barbie gonna be? It really went through a crisis, 763 00:38:11,360 --> 00:38:14,440 Speaker 7: the whole company did, because Barbie fell out a step 764 00:38:14,440 --> 00:38:18,120 Speaker 7: with society. They remade The Doll in twenty sixteen and 765 00:38:18,160 --> 00:38:21,160 Speaker 7: made it more inclusive with different body types and that 766 00:38:21,320 --> 00:38:24,760 Speaker 7: sort of thing. So this is trying to showcase that work, 767 00:38:25,680 --> 00:38:29,360 Speaker 7: but it doesn't really. I mean, analysts aren't really seeing 768 00:38:29,400 --> 00:38:32,160 Speaker 7: a big Toy sail bump in twenty twenty three. It 769 00:38:32,160 --> 00:38:34,680 Speaker 7: could be more long term, and I think the real 770 00:38:34,800 --> 00:38:36,960 Speaker 7: value for Mattel would come if they can turn it 771 00:38:37,000 --> 00:38:40,480 Speaker 7: into a broader franchise, like a Marvel type of franchise, 772 00:38:40,560 --> 00:38:42,239 Speaker 7: you know, where you have a Ken movie spin off 773 00:38:42,280 --> 00:38:45,440 Speaker 7: and a Skipper TV series and a you know, roller 774 00:38:45,440 --> 00:38:47,319 Speaker 7: coaster and that sort of thing. 775 00:38:47,520 --> 00:38:50,400 Speaker 6: I was traumatized by Barbie. My sisters had it, and 776 00:38:50,440 --> 00:38:53,200 Speaker 6: they used to take the legs and they'd hit me 777 00:38:53,239 --> 00:38:56,000 Speaker 6: with it. So I had these like two little bruises 778 00:38:56,040 --> 00:38:59,040 Speaker 6: where Barbie's breasts hit me in the you know. 779 00:38:59,320 --> 00:39:02,120 Speaker 3: It's just like sorry to hear that, John. Hopefully you 780 00:39:02,160 --> 00:39:05,040 Speaker 3: can you can go watch this movie and get a 781 00:39:05,080 --> 00:39:05,400 Speaker 3: little bit. 782 00:39:05,440 --> 00:39:07,920 Speaker 6: Has anybody seen it yet or is it you're waiting 783 00:39:07,920 --> 00:39:09,240 Speaker 6: for reviews and all that stuff. 784 00:39:09,400 --> 00:39:13,080 Speaker 3: It's it's coming out in July, right, Kelly later later, Yeah, 785 00:39:13,280 --> 00:39:13,920 Speaker 3: a couple of weeks. 786 00:39:14,000 --> 00:39:16,719 Speaker 7: That's right. Some people have seen it. They're all critics. 787 00:39:17,440 --> 00:39:19,879 Speaker 7: Their reviews should start coming on the thirteenth, and then 788 00:39:19,960 --> 00:39:23,680 Speaker 7: it's world premiere is on Sunday, but it's released wide 789 00:39:23,719 --> 00:39:25,240 Speaker 7: on the play first. 790 00:39:25,440 --> 00:39:28,319 Speaker 4: Thank you, Kelly for those listening on radio not seeing us. 791 00:39:28,360 --> 00:39:30,640 Speaker 4: My hand is physically out in front of John to 792 00:39:30,719 --> 00:39:33,120 Speaker 4: kind of control the commentary here when it comes to. 793 00:39:33,200 --> 00:39:35,480 Speaker 6: Barbie, because you're going to hit me with your Barnbach. 794 00:39:35,560 --> 00:39:38,440 Speaker 3: All right, Kelly, thank you so much for joining us. 795 00:39:38,440 --> 00:39:40,319 Speaker 4: Sorry, things are getting a little crazy as we wrap 796 00:39:40,400 --> 00:39:42,280 Speaker 4: up our show, but it's an incredible story. 797 00:39:42,280 --> 00:39:43,719 Speaker 3: It's Today's Big Take. 798 00:39:43,760 --> 00:39:45,640 Speaker 4: You can find it on Bloomberg dot com or on 799 00:39:45,719 --> 00:39:47,960 Speaker 4: the terminal wherever you get your Bloomberg News. It's also 800 00:39:48,000 --> 00:39:50,560 Speaker 4: the Big Take podcast, which you can download wherever you 801 00:39:50,560 --> 00:39:54,000 Speaker 4: get your podcasts as well. It's incredibly well researched. They 802 00:39:54,000 --> 00:39:57,120 Speaker 4: go through everything when it comes to Mattel and the 803 00:39:57,160 --> 00:40:00,560 Speaker 4: Barbie movie. Highly recommend giving it a read or listen 804 00:40:00,640 --> 00:40:01,520 Speaker 4: over the weekend. 805 00:40:05,200 --> 00:40:08,279 Speaker 2: Thanks for listening to the Bloomberg Markets podcast. You can 806 00:40:08,320 --> 00:40:12,080 Speaker 2: subscribe and listen to interviews at Apple Podcasts or whatever 807 00:40:12,200 --> 00:40:15,920 Speaker 2: podcast platform you prefer. I'm Matt Miller. I'm on Twitter 808 00:40:16,120 --> 00:40:19,320 Speaker 2: at Matt Miller nineteen seventy three, and I'm fall Sweeney. 809 00:40:19,360 --> 00:40:22,120 Speaker 1: I'm on Twitter at Ptsweeney Before the podcast, you can 810 00:40:22,239 --> 00:40:26,399 Speaker 1: always catch us worldwide at Bloomberg Radio