Speaker 1: Welcome to the Bloomberg pim L Podcast. I'm pim Fox.
Speaker 1: Along with my co host Lisa Abramowitz. Each day we
Speaker 1: bring you the most important, noteworthy, and useful interviews for
Speaker 1: you and your money, whether at the grocery store or
Speaker 1: the trading floor. Find the Bloomberg pi L podcast on iTunes,
Speaker 1: SoundCloud and at Bloomberg dot com. All right, let's solve
Speaker 1: some of the issues related to investing in fixed income
Speaker 1: with Jim Bianco. He is the president and the founder
Speaker 1: of Bianco Research, and he joins us now, Jim, great
Speaker 1: to have you with us. As always, I wonder if
Speaker 1: you could just comment on an interview that Bloomberg's Eric
Speaker 1: Schatzka just did with the Ben Melkman Uh formerly of
Speaker 1: Brevan Howard is speaking about the the slope of the
Speaker 1: yield curve and how he sees that that is going
Speaker 1: to increase. Uh. Great conviction, Great conviction. I beg your pardon,
Speaker 1: great conviction that you're going to see this big slope
Speaker 1: we move higher in the yeeld curve. Yeah, not really.
Speaker 1: I I understand why you would think that if you
Speaker 1: thought that inflation was going to come back, and you'd
Speaker 1: say and even if the FED was going to raise rates,
Speaker 1: the long end of the Yelk curve would go up
Speaker 1: a lot faster. But I'm not fully into the inflation
Speaker 1: camp just yet. I know that that's been the popular
Speaker 1: idea for a lot of people, that inflation is going
Speaker 1: to return, and if not, and we see more weakness,
Speaker 1: you're going to see the long end of the yeel
Speaker 1: curve fallen yields relative to the front end of the
Speaker 1: Yelk curve. They're not gonna go down in the front end.
Speaker 1: They might still go up at the FED races rates,
Speaker 1: and you might see still see the curve stay words
Speaker 1: at right now, if not flatten a little bit more.
Speaker 1: But it really comes down to what your view of
Speaker 1: inflation is. That it's it's not here yet. I understand
Speaker 1: that everybody's looking for it. I get the idea that
Speaker 1: wages are percolating a little bit, but they have been
Speaker 1: for about eighteen months. Uh. I also see the idea
Speaker 1: that you know, in the forward measures of inflation, like
Speaker 1: inflation expectations are starting to move a little bit higher.
Speaker 1: But I've seen this movie since two thousand nine, at
Speaker 1: least four or five other times, and it always seems
Speaker 1: to peter her out because at the end of the day,
Speaker 1: you still have way too weak a growth I think
Speaker 1: to create the um the type of inflation demand pull
Speaker 1: that I think most people are looking for, because I
Speaker 1: don't see that. I don't think we're going to get
Speaker 1: the inflation that everybody's hoping for. See, you had Morgan
Speaker 1: Stanley coming out earlier today and talking about how he
Speaker 1: had they expect uh the ten your treasury yield to
Speaker 1: go to two percent by your end. It's currently at
Speaker 1: one point eight percent. What do you think where do
Speaker 1: you think it will end up? You know, two percent?
Speaker 1: It's probably a ceiling. Because I'm a lot more bullish
Speaker 1: than people think I'm. My my view going into next
Speaker 1: year is still going to be that inflation is not
Speaker 1: going to be there, the growth is gonna stay low.
Speaker 1: We still have the potential of a shock maybe in
Speaker 1: financial markets that could push financial markets down, something similar
Speaker 1: to a Brexit. Maybe it's next week in the election,
Speaker 1: or maybe it's in December with the Italian referendum, which
Speaker 1: I think could be Blexit one point five that the
Speaker 1: Italian referendum is that big. So there's a lot of
Speaker 1: things I see that could push rates lower. As opposed
Speaker 1: to pushing them higher. So yeah, we hit one yesterday.
Speaker 1: Two percent might be an absolute ceiling on the market,
Speaker 1: But I do think that the next big moving rates
Speaker 1: would be lower. All right, next big moving rates lower? Chimpianco.
Speaker 1: Tell me about commodity prices. Are commodity prices at their
Speaker 1: bottom or are we going to see a continued increase? Well,
Speaker 1: you know the thing about commodities right now is you
Speaker 1: almost have to separate them out, you know, Like my
Speaker 1: favorite line about them is carn copper, cocoa, crude oil, um,
Speaker 1: and coffee. I'll start with the letter C. But they're
Speaker 1: not all necessarily commodities in a aggregate because they all
Speaker 1: do very different things. The agricultural markets look very bullish
Speaker 1: right now. They could continue to move higher. The precious
Speaker 1: metals are struggling. I still think that oil is topping
Speaker 1: or the energy complex is topping as well too. And
Speaker 1: you're kind of going sideways with the industrial metals. So
Speaker 1: they're all over the lot. But if you wanted to
Speaker 1: look at it in a big picture, there is no
Speaker 1: strong breakout of the commodity indexes right now. They're probably
Speaker 1: trending sideways to slightly lower and that strong breakout, which
Speaker 1: would suggest world growth is coming. I don't think that
Speaker 1: indicator is going to give it to us right now.
Speaker 1: So you know, you're saying that you think there's the
Speaker 1: next move in rates is going to be lower. Uh,
Speaker 1: it seems like the consensus from well, it seems like
Speaker 1: the consensus is kind of splintering. What do you think
Speaker 1: the big consensus trade is right now? You know, that's
Speaker 1: a good question because it depends on who you talk to.
Speaker 1: If if you ask somebody who's got the title economist,
Speaker 1: they've embarrassed on rates since about two thousand three, and
Speaker 1: you know, don't let a hundred and fifty months of
Speaker 1: being wrong getting away. Their rates are still going to
Speaker 1: keep going up. If you ask a grater, they're much
Speaker 1: more bultless on the market right now, and portfolio managers
Speaker 1: are a little bit in the middle. I would still
Speaker 1: argue to you, though, that the bigger surprise in the
Speaker 1: marketplace would be a move down to one thirty on
Speaker 1: the tenure yield, which was the early July low and
Speaker 1: the all time low, as opposed to a move back
Speaker 1: to the January one high of to So I think
Speaker 1: that the surprise move given all of that would probably
Speaker 1: be a revisit of the All Time Lows, which was
Speaker 1: set just in early July. So we're gonna see this
Speaker 1: movie for another like seven or eight, maybe nine more times.
Speaker 1: Jim Bianco, thank you so much for coming and joining us.
Speaker 1: Jim Bianco of Bianco Research in Chicago. I want to
Speaker 1: learn more about Suicide Squad. I want to learn more
Speaker 1: about Suicide Squad from Paul Sweeney, the director of North
Speaker 1: American Research and Media UH for Bloomberg Intelligence. Paul, did
Speaker 1: you see it? I did not, but fortunately a lot
Speaker 1: of other people did. And that was one of the
Speaker 1: contributors to a pretty strong quarter from Time Warner this morning.
Speaker 1: You know, their movie Studio did did did well as expected.
Speaker 1: The cable networks actually did a little bit better than expected,
Speaker 1: and that those are the real cash flow drivers for
Speaker 1: the company. UH and HBO, the third leg of that stool.
Speaker 1: At that the company also had a pretty good quarter.
Speaker 1: So the company beat expectations here in the quarter. They
Speaker 1: were able to raise their guidance for the year a
Speaker 1: little bit in terms of profitability, so I'm sure they
Speaker 1: feel pretty good about it. I'm sure A T and
Speaker 1: T does as well. Well. Yeah, so this is this
Speaker 1: is what surprises me. Right, Time Warner should feel good,
Speaker 1: A T and T should feel good. Both stocks down. Yeah,
Speaker 1: I think the you know, it's interesting about this deal,
Speaker 1: the A T. T and Time Warner deal. The marketplace
Speaker 1: is very dubious about this deal getting approved. I mean,
Speaker 1: it's it's a transaction that's not scheduled closing to the
Speaker 1: end of twenty seventeen. But even if you kind of
Speaker 1: do the arbitrage math, that suggests that, I think the
Speaker 1: market is dis kind of a less than fifty fifty
Speaker 1: chance that this deal gets approved by by the regulators.
Speaker 1: And so you know, we're gonna have to see how
Speaker 1: things play out with the election and then see how
Speaker 1: the things play out with the regulators. But a lot
Speaker 1: of uncertainty around this deal. Hey, Paul, can we just
Speaker 1: go through the three areas that Time Warner is on
Speaker 1: involving because you mentioned the cable channels, right, the cable
Speaker 1: broadcast monthly subscription fees higher, right, So it's you know,
Speaker 1: the monthly subscription fees. Those those are the fees that
Speaker 1: the cable companies like Comcast and pay to the media
Speaker 1: owners like Time Warner and by via com to carry
Speaker 1: the channels. Those have typically have been growing a revenue
Speaker 1: stream for the media companies in the high single digit range. Uh.
Speaker 1: Time Warner actually did a little bit better. Um, they
Speaker 1: were able to renegotiate some of their contracts recently. That
Speaker 1: took advantage that we're that priced in the NBA UH contract,
Speaker 1: which they were able to charge them higher fees because
Speaker 1: they're now carrying some NBA games. So UH, that was
Speaker 1: a pretty strong driver for them. Advertising UH is still
Speaker 1: relatively strong in the marketplace, and Time Warners cable networks
Speaker 1: are big beneficiary of that as well. Is is the
Speaker 1: HBO now that stand alone streaming service they give any
Speaker 1: indication or how that's performing, Uh, it's performing pretty well.
Speaker 1: There's there's north of one million new subscribers or stand
Speaker 1: alone subscribers to HBO. Now, UM, you know, the real
Speaker 1: question that I think investors have is are these new
Speaker 1: subscribers to HBO or they cannabalizing some of their existing
Speaker 1: subscribers that get it through a cable system. Time Warners
Speaker 1: suggesting that the vast majority of these are our new subscribers, UH,
Speaker 1: younger demos, people that were not subscribing to HBO in
Speaker 1: the future. But that's clearly I think where the industry
Speaker 1: is going, which is to make your programming available not
Speaker 1: just on the traditional cable systems, but also direct to consumers,
Speaker 1: very similar to help people get their Netflix. So at
Speaker 1: the end of the day, we're going to know everything
Speaker 1: that we need to know about media, the current state
Speaker 1: of media in the world. We're gonna get some earnings
Speaker 1: from twenty first century Fox as well as Facebook. So
Speaker 1: when you wake up tomorrow morning, what's the narrative going
Speaker 1: to be. Well, the narrative is going to be that
Speaker 1: the traditional media companies like twenty one century Fox are
Speaker 1: in pretty good shape, but the real growth, the real
Speaker 1: ad dollars are shifting continuing to shift to the media
Speaker 1: to the online media companies like Facebook. So Facebook is
Speaker 1: going to put up a revenue growth north of fifty
Speaker 1: percent um, and you compare that to some of the
Speaker 1: high single digit revenue we've seen from the traditional media
Speaker 1: companies and just shows you the way of the world.
Speaker 1: I'm just gonna say, take a look at the annual
Speaker 1: revenue growth of Facebook. We're going I know we're going
Speaker 1: to get quarterly after the close of trading, but you're
Speaker 1: talking going from five billion to seven point eight billion
Speaker 1: to twelve to seventeen. The estimate now twenty two billion,
Speaker 1: and this is in four years. A company goes from
Speaker 1: five billion to twenty two billion. Yeah, it's just amazing.
Speaker 1: And if you think about online uh, you know, internet advertising,
Speaker 1: two companies take more than fifty of it, and that
Speaker 1: is Facebook and Google. If you're a big brand advertiser
Speaker 1: like a Ford Motor Company or a Coca Cola and
Speaker 1: you want to advertise digitally, only two places you can
Speaker 1: really spend your money, and that's Google and Facebook. And
Speaker 1: they also integrate the advertising and marketing. They actually have
Speaker 1: employees from both companies. The advertisers plus Facebook and Google
Speaker 1: actually get together on a regular basis, uh, to make
Speaker 1: those kinds of decisions. Yeah, it's it's it's really been
Speaker 1: been amazing kind of what what they're doing, and it's
Speaker 1: kind of frozen out a lot of the other players.
Speaker 1: So you see like a Twitter sitting there with three
Speaker 1: and twenty million uh subscribers are users onto their platform.
Speaker 1: They are really finding it hard to really get the
Speaker 1: attention at Madison Avenue and a big advertisers, so it's
Speaker 1: really become a dual woppily from the perspective of uh,
Speaker 1: you know, the big online advertisers. So you know that's
Speaker 1: one of the things A T and T says, A
Speaker 1: T and T says, we are going to create a
Speaker 1: big advertising alternative to the Google and facebooks of the world. Well,
Speaker 1: as Lisa just mentioned, shares of A T and T
Speaker 1: there down about a quarter of a percent today. Thank
Speaker 1: you very much for joining us. Paul Sweeney, head of Research,
Speaker 1: Director of Research for Bloomberg Intelligence. Well, he's a human
Speaker 1: and he's been tracking human feelings about the election. Mark
Speaker 1: Niquette is our politics and national government reporter for Bloomberg News.
Speaker 1: He can be followed on Twitter at m Niquette. All right, Mark,
Speaker 1: we got a pole and then there's something from President
Speaker 1: Obama having to do with the FBI. Let's start with
Speaker 1: the independent of the Poll of Independence by Bloomberg Politics.
Speaker 1: What what does it show. It's actually a bit of
Speaker 1: good news for Hillary Clinton after several days here of
Speaker 1: bad news related to the release of the FBI letter
Speaker 1: showing there is more scrutiny on emails. The Poll of
Speaker 1: Independence folks who say they haven't decided yet showed her
Speaker 1: with a slight advantage over Donald Trump. About that's important
Speaker 1: because this is a group of swing voters that can
Speaker 1: often decide an election in particularly in key battleground states.
Speaker 1: And it's a group that Republican met Romney won by
Speaker 1: five percentage points in twelve. So it shows that Donald
Speaker 1: Trump is still having some trouble sort of building the
Speaker 1: coalition of of Republicans and independence that you know helped
Speaker 1: Romney and twelve and even then he lost. So it
Speaker 1: shows he still has some work to do to get
Speaker 1: these folks to build a coalition that wins. It seems like,
Speaker 1: just based on market action, that a lot of traders
Speaker 1: certainly think that Trump is that Mr Trump is is
Speaker 1: positioning in a better position right now to become our
Speaker 1: next president than Secretary Clinton. And you know, from the
Speaker 1: people you speak with, the analysts, do you do, they
Speaker 1: seem to suggest that Trump has seriously improved his odds
Speaker 1: of becoming president in the past couple of days. Now
Speaker 1: there are signs and suggestions that you know, he has
Speaker 1: better position today than he was a last week. I mean,
Speaker 1: certainly before the news that fb FBI letter broke, you know,
Speaker 1: the sense was we were headed towards a pretty solid
Speaker 1: Clinton victory and that the race has tightened now significantly now,
Speaker 1: you know, we always expected the race to get closer
Speaker 1: as Republican voters sort of came home in the final
Speaker 1: days before the election. Um, but the FBI revelation seemed
Speaker 1: to have sort of shifted the thinking and feeling about
Speaker 1: this race. I mean, it's still I think gonna be
Speaker 1: an uphill climb for Trump to get to electoral votes.
Speaker 1: I mean, his campaign has essentially laid out that he
Speaker 1: needs to win Florida, North Carolina, Ohio, and Iowa and
Speaker 1: then another battleground state to really have a good shot
Speaker 1: at two torn it to the in seventy electoral votes.
Speaker 1: So Clinton can stop him in any one of those states,
Speaker 1: you know, she would still be the favorite, I think.
Speaker 1: But you know, as it has been through this entire election,
Speaker 1: people are weary now of making predictions, and it's been
Speaker 1: so unpredictable. You know, we're gonna have to see what
Speaker 1: happens on election day for sure. Another big question are
Speaker 1: certainly among the people who I speak with, is will
Speaker 1: Congress back Donald Trump's proposals, Particularly is economic proposals, which
Speaker 1: are rather expansive and don't really kind of cohere with
Speaker 1: traditional uh sort of fiscal conservatism. Uh So you know,
Speaker 1: what's your sense, do you use your sense that that
Speaker 1: the House and Senate will back his proposals as is,
Speaker 1: well a lot will be turned down. What the composition
Speaker 1: of Congress looks like after this election. I mean, we're
Speaker 1: still waiting to see, you know what, who controls the Senate.
Speaker 1: You know, there's a there's a chance at least for
Speaker 1: the Democrats to regain control there and with the mix
Speaker 1: of sort of very conservative members versus you know, more
Speaker 1: moderate Republicans in the House will be assuming they continue
Speaker 1: controlling that chamber. Um, And you're right, I mean, there's
Speaker 1: there's Trump's proposals have kind of a mix of sort
Speaker 1: of more traditional Reaganesque kind of elements, like his tax
Speaker 1: proposals I think would would have more broadest acceptance there.
Speaker 1: But you know there's other things that I think he
Speaker 1: would have trouble getting through Congress. But you know, a
Speaker 1: lot of variables there to be determined before we can
Speaker 1: sort of guess on how you know, anything specific might
Speaker 1: play out. Mark the President. President Barack Obama has said
Speaker 1: he was giving a interview and online he describes He
Speaker 1: said that the FBI Director James Comby's decision to renew
Speaker 1: a probe of Hillary Clinton's emails had become a political controversy. Yeah,
Speaker 1: I think there's no question about that. I mean, President
Speaker 1: Obama is in a tough position, and as much as
Speaker 1: this is his appointed right and he can't sort of
Speaker 1: be out there publicly, you know, sort of questioning him
Speaker 1: or or undermining him. Um, but you know there's no
Speaker 1: question that you know, having the FBI director, you know,
Speaker 1: send this letter to Congress eleven days before election sort
Speaker 1: of raises the question of whether you know, the FBI
Speaker 1: is you know, interfering or at least you know, influencing
Speaker 1: election by doing this so close to the voting, and
Speaker 1: you know, whether that was the intent or not. Sort
Speaker 1: the practical outlook impact of that could be that this
Speaker 1: ways you know, votes in the race, which is something
Speaker 1: that you know, the Justice Department and FBI you know,
Speaker 1: sort of a rule that right to avoid you know,
Speaker 1: pretty fastidiously. I mean, this is basically like Obama saying
Speaker 1: we breathe there. I mean, of course, has become a
Speaker 1: political controversy. I mean every poll has kind of showed
Speaker 1: that it's certainly being taken to some degree, uh like
Speaker 1: that whether or not it's justified or not is a
Speaker 1: whole other question. It certainly has become a political story.
Speaker 1: Mark going forward, what is the one thing that you're
Speaker 1: looking at today that you think that is sort of
Speaker 1: the underreported story. I think the underreported story, UM is
Speaker 1: what's happening with early vote among key elements of the
Speaker 1: Obama coalition. This is the sort of African Americans, young
Speaker 1: voters in particular Latinos who supported Barack Obama and are
Speaker 1: they UM is going to go with with Hillary Clinton
Speaker 1: in the numbers that she needs to UM to win.
Speaker 1: And we're seeing a little bit of that insight with
Speaker 1: the early voting totals that are coming out suggest that
Speaker 1: there might be less enthusiasm among African Americans, for example,
Speaker 1: for Hillary Clinton and there was for Obama. And I
Speaker 1: think diving into those numbers and how that coalition votes
Speaker 1: will a little long wait or to turning whether Hillary
Speaker 1: Clinton wins. Mark Niqette, thank you so much for being
Speaker 1: with us. Mark Niquette, politics and national government reporter for
Speaker 1: Bloomberg News breaking down all things related to this presidential election.
Speaker 1: I'm Lisa Bramo. It's here with pim Fox. This is Bloomberg.
Speaker 1: The Shares of te connectivity. They are higher by about
Speaker 1: one and a half percent. Many people may not know
Speaker 1: about t E Connectivity. It has a former name, Tycho Electronics.
Speaker 1: And here to tell us more about t E Connectivity
Speaker 1: and its future is Tom Lynch. He is the chairman
Speaker 1: of the Connectivity. He's also the outgoing chief executive. Also
Speaker 1: with us is the president and the incoming chief executive,
Speaker 1: Terrence Curtain. Thank you, gentlemen for being here here. I
Speaker 1: was gonna say that must be some kind of special ceremony,
Speaker 1: you know, a secret password or something. But I'm wondering
Speaker 1: if you could just describe Tom, what kind of company
Speaker 1: are you? I know you're gonna remain chairman, but what
Speaker 1: kind of company do you feel you're handing over to
Speaker 1: Terrence to to take charge of a very good company.
Speaker 1: We have lots of opportunity to get better detailed. Give
Speaker 1: I know, but give us the d because I was
Speaker 1: reading there's a lot of cool stuff you've been You
Speaker 1: work with companies like Google and Facebook. People may not
Speaker 1: know this. Tell us what what is t E Connectivity.
Speaker 1: T Connectivity is a twelve billion dollar global company with
Speaker 1: seventy of our revenue outside the US, and we're right
Speaker 1: in the middle of the connected world phenomena. So automotive, aircraft, machinery,
Speaker 1: communications equipment, sent medic a lot of sensors, a lot
Speaker 1: of connectors, and a lot of connectors, uh twelve billion
Speaker 1: plus of them. So we're in a great a great industry,
Speaker 1: say multiple industries. Everybody's our customers, we like to say, well,
Speaker 1: and it's a very competitive industry. So, Terrence, I wanted
Speaker 1: to talk with you a little bit about going forward. Yes,
Speaker 1: this is the future as far as is everything under
Speaker 1: the sun being connected, but there is everyone also wanting
Speaker 1: to get in that from Google to Amazon to who
Speaker 1: knows whoever h So what's the competitive landscape like and
Speaker 1: how big do you think the business could grow when
Speaker 1: when we look at the business day, like Tom says,
Speaker 1: about twelve billion dollars, and when we look at the landscape,
Speaker 1: it's a pretty diverse landscape. The customers that you mentioned
Speaker 1: are more of our customers and competitors to Googles and
Speaker 1: the Facebook's. Our engineers were fortunate. We have over seven
Speaker 1: thousand engineers that actually enable some of the customers that
Speaker 1: you talked about, as well as the automotive companies that
Speaker 1: Tom talked about. So what's great is how we're globally deployed,
Speaker 1: and I think we get the benefit of the trends
Speaker 1: of the connected world as well as the various industries
Speaker 1: we have so that can be automotive, medical. From a
Speaker 1: competitive standpoint, it's many different type of competitors. There isn't
Speaker 1: one single competitor we go up against. It really depends
Speaker 1: upon the applications we play into, and that's one of
Speaker 1: the things that we think we excel at bringing that
Speaker 1: engineering to our customers to really enable where they want
Speaker 1: to take the connected world. Terrence, I got to mention
Speaker 1: a couple of projects this kind of give some flesh
Speaker 1: to all of this Pacific Light cable network. You have
Speaker 1: just chosen, I believe to be a contractor there for
Speaker 1: this is a Facebook Google project. You've also got the
Speaker 1: new Cross Pacific and Maria and I wonder if you
Speaker 1: could just tell us about each of those and and
Speaker 1: how that defines the company. Yeah, him, great questions are
Speaker 1: projects we've had in our SubCom business, which is a
Speaker 1: little bit less than temporary to tell people's SubCom, SubCom, SUBM,
Speaker 1: submarine communications, and really what we do in our SubCom
Speaker 1: business is really build out the long haul oceanic systems
Speaker 1: for the world, and they actually support the cloud. So
Speaker 1: anytime you think about a cloud application, really, where do
Speaker 1: you get to the data senators support? And that's where
Speaker 1: the Facebook's, the Google's, the Microsoft that are building the
Speaker 1: cloud applications. We support them by building systems that they
Speaker 1: actually own and use to make sure they can bring
Speaker 1: their services down to their customers. And that's what's great
Speaker 1: about what t E does is we enable our customers
Speaker 1: to bring that great connected world tour. Tom, You've been
Speaker 1: the CEO since two thousand and six. The world has
Speaker 1: changed a lot in the ten years. What's been the
Speaker 1: biggest change in your industry? Well, the trends have accelerated
Speaker 1: for connectivity, that's the biggest thing. You know, it has
Speaker 1: been a big shift. It's just been no it's it's
Speaker 1: just it's acceleration. So maybe the best way to think
Speaker 1: about it, I think of what a car was like
Speaker 1: ten years ago versus today. It's it's incredibly different inside, right,
Speaker 1: you still have four tires and an engine, but the
Speaker 1: connectivity throughout it, the safety systems throughout it. Every time,
Speaker 1: you know, the UH you have to improve emissions, more
Speaker 1: and more technology going into the car. So that's the
Speaker 1: great thing about this business. It's this acceleration of smarts
Speaker 1: into virtually every aspect of the world, and it requires
Speaker 1: more sensors and more connectivity. For us as a business,
Speaker 1: the big changes. We weren't in the censor business ten
Speaker 1: years ago. Now we're one of the world's leading sensor suppliers.
Speaker 1: We weren't in the minimally invasive medical device business selling uh,
Speaker 1: the subsystems into that. Now we're one of the biggest
Speaker 1: players in that area. So for us, you know, we've
Speaker 1: jumped on those big trends in the last five years.
Speaker 1: Margins tell us a little bit about margins. Who wants
Speaker 1: to handle that? You want to take that? Go ahead.
Speaker 1: Our margins today are pre tax operating margins run north
Speaker 1: of six or after tax margins run about twelve. So
Speaker 1: a very healthy business. And the reason for that is is,
Speaker 1: as Terrence mentioned, in these harsh environments where of our
Speaker 1: business is very hard to you know, to to get
Speaker 1: these solutions and get them right. So if we design
Speaker 1: something in that has to go onto the engine of
Speaker 1: a car, it's and that car is on the road
Speaker 1: for twenty years, it has to last for twenty years
Speaker 1: and all, you know, the in the environment, whether it's hot, cold, wet, dry,
Speaker 1: So you get paid for that because your customers rely.
Speaker 1: We're very deep in the architecture of our customers and products,
Speaker 1: and you get paid for that. So it's it's a
Speaker 1: good business and it's a good cash flow business. Thank
Speaker 1: you so much for being with us. Uh Tom Lynch,
Speaker 1: the outgoing CEO of t E Connectivity, and Terrence Curtain,
Speaker 1: the incoming CEO of the company. Thank you so much
Speaker 1: for being with us. Thanks for listening to the Bloomberg
Speaker 1: P and L podcast. You can subscribe and listen to
Speaker 1: interviews at iTunes, SoundCloud, or whatever podcast platform you prefer.
Speaker 1: I'm pim Fox. I'm out there on Twitter at pim Fox.
Speaker 1: I'm out there on Twitter at Lisa Abramo. It's one
Speaker 1: before the podcast. You can always catch us worldwide on
Speaker 1: Bloomberg Radio.