1 00:00:05,120 --> 00:00:09,280 Speaker 1: Welcome to the Bloombergs Surveillance Podcast Hometown Keene. Along with 2 00:00:09,320 --> 00:00:13,200 Speaker 1: the Jonathan Feral and Lisa Brownwitz. Jaylie, we bring you 3 00:00:13,320 --> 00:00:17,799 Speaker 1: insight from the best and economics, finance, investment, and international 4 00:00:20,280 --> 00:00:26,880 Speaker 1: Johnson something else. And if you're talking to friends and family, 5 00:00:27,120 --> 00:00:29,760 Speaker 1: they're thinking about other things through the summer too. Absolutely, 6 00:00:29,760 --> 00:00:31,560 Speaker 1: everybody's trying to figure out exactly how they're going to 7 00:00:31,600 --> 00:00:35,280 Speaker 1: get away for some sort of a vacation holiday throughout 8 00:00:35,280 --> 00:00:37,480 Speaker 1: the summer, John, And it's interesting you listen to what 9 00:00:37,560 --> 00:00:40,040 Speaker 1: the CDC is saying, and it's a similar thing over 10 00:00:40,080 --> 00:00:43,800 Speaker 1: here in the UK as well. The scientists incredibly cautious 11 00:00:44,200 --> 00:00:47,360 Speaker 1: about traveling. Certainly here in the UK, that is the narrative, 12 00:00:47,360 --> 00:00:49,840 Speaker 1: but John, investors just don't see it that way. Bring 13 00:00:49,920 --> 00:00:53,320 Speaker 1: up the chart of Ryanair from the beginning of we're 14 00:00:53,320 --> 00:00:57,400 Speaker 1: back to the same levels that we came in to at. 15 00:00:57,520 --> 00:01:00,560 Speaker 1: Basically the stock has completely rebound I did, as you 16 00:01:00,560 --> 00:01:03,960 Speaker 1: can see during that period. Actually we're up by seven 17 00:01:04,000 --> 00:01:07,000 Speaker 1: and a half percent, So investors certainly see a reopening. 18 00:01:07,080 --> 00:01:08,920 Speaker 1: As you pointed out with Lisa just before the break, 19 00:01:08,959 --> 00:01:11,200 Speaker 1: a lot of volatility though in the stock over the 20 00:01:11,240 --> 00:01:14,560 Speaker 1: last few days as we've seen the equivocation from the 21 00:01:14,640 --> 00:01:17,959 Speaker 1: UK and the case counts climbing within the EU, the 22 00:01:17,959 --> 00:01:21,440 Speaker 1: health situation getting worse and worse. UM, let's bring in 23 00:01:21,480 --> 00:01:25,960 Speaker 1: Michael O'Leary, he's the Ryanair CEO to talk about this. Michael, 24 00:01:26,120 --> 00:01:28,440 Speaker 1: good morning. You were talking about the idea on a 25 00:01:28,480 --> 00:01:30,800 Speaker 1: call a little earlier on that you're gonna be flying 26 00:01:30,920 --> 00:01:35,039 Speaker 1: eight of the schedule that you would normally fly kind 27 00:01:35,040 --> 00:01:38,680 Speaker 1: of July to September. What's your degree of confidence in 28 00:01:38,680 --> 00:01:41,640 Speaker 1: that number? Yeah, good morning, Guide my John think there's 29 00:01:41,640 --> 00:01:44,319 Speaker 1: a reasonably hydree of campers at this point in time 30 00:01:44,360 --> 00:01:48,320 Speaker 1: that short order flying with significantly recover. I think through 31 00:01:48,360 --> 00:01:51,320 Speaker 1: the peak summer months of July, August and September. That's 32 00:01:51,360 --> 00:01:53,480 Speaker 1: drum amount the success of the vaccine program in the 33 00:01:53,560 --> 00:01:56,640 Speaker 1: UK fifty percent of the UK population that has now 34 00:01:56,680 --> 00:01:58,840 Speaker 1: been vaccinated by the end of May, that would be 35 00:01:58,880 --> 00:02:01,520 Speaker 1: an easy percent. Europe will catch up. I can go 36 00:02:01,520 --> 00:02:03,880 Speaker 1: over that period of time with think of the UK 37 00:02:03,960 --> 00:02:05,920 Speaker 1: adult population with actually by the end of May they 38 00:02:05,960 --> 00:02:09,200 Speaker 1: say seventy by the end of June, and then I 39 00:02:09,240 --> 00:02:12,440 Speaker 1: think you will see a pretty rapid recovery of short 40 00:02:12,520 --> 00:02:16,120 Speaker 1: haul holiday travel between the UK and the European Union 41 00:02:16,200 --> 00:02:19,600 Speaker 1: through the summer. Already, the Portuguese, the Spanish, the Greek 42 00:02:19,600 --> 00:02:22,160 Speaker 1: and the Cypriot governments have said they're going to welcome 43 00:02:22,280 --> 00:02:26,320 Speaker 1: vaccinated UK travelers from the seventeenth of May onwards. So 44 00:02:26,919 --> 00:02:29,040 Speaker 1: you know, it's still certain, but I think there's a 45 00:02:29,120 --> 00:02:34,079 Speaker 1: reasonable grounds for optimism that once the school holidays arrived June, July, August, 46 00:02:34,120 --> 00:02:37,160 Speaker 1: that we will see I think quite significant recovery of 47 00:02:37,240 --> 00:02:41,160 Speaker 1: shorthold travel within Europe. You won't see longhold recover this summer, 48 00:02:41,440 --> 00:02:43,240 Speaker 1: but again, a lot of people who would normally have 49 00:02:43,320 --> 00:02:45,560 Speaker 1: gone long hold for their holidays to the States or 50 00:02:45,600 --> 00:02:47,880 Speaker 1: to Asia will holiday at home in Europe. But we 51 00:02:47,960 --> 00:02:50,600 Speaker 1: think Ryan there will be the beneficiary of that. You 52 00:02:50,680 --> 00:02:53,120 Speaker 1: sound confidence, you think it's going to happen later on 53 00:02:53,200 --> 00:02:55,639 Speaker 1: in the year, but but the date keeps getting pushed 54 00:02:55,639 --> 00:02:58,040 Speaker 1: to the rights and certain the noises out of the 55 00:02:58,080 --> 00:03:02,480 Speaker 1: UK over the last few days have been less than optimistic. Michael, 56 00:03:02,520 --> 00:03:05,760 Speaker 1: you said this morning that that you could survive if 57 00:03:05,760 --> 00:03:08,480 Speaker 1: we don't have a summer season. My question to you 58 00:03:08,720 --> 00:03:11,520 Speaker 1: is how. But we're very strong balance sheet. You know, 59 00:03:11,560 --> 00:03:13,240 Speaker 1: we're sitting on more than three and a half billion 60 00:03:13,280 --> 00:03:15,359 Speaker 1: of cash At the moment, we have a very small 61 00:03:15,440 --> 00:03:19,400 Speaker 1: cash outflow. Most of our aircraft are grounded at the moment, 62 00:03:19,440 --> 00:03:22,960 Speaker 1: most of our plastic cameracrew are on furlough, paced schemes, etcetera. 63 00:03:23,040 --> 00:03:26,200 Speaker 1: So we can survive. We don't want to survive. We 64 00:03:26,280 --> 00:03:28,360 Speaker 1: do want to see people return to travel. And I 65 00:03:28,360 --> 00:03:31,240 Speaker 1: would put the question back to those UK governments if, 66 00:03:31,400 --> 00:03:35,200 Speaker 1: as the UK government has you vaccinatedent of the adult 67 00:03:35,200 --> 00:03:37,960 Speaker 1: population by the end of May, why are you restricting 68 00:03:38,000 --> 00:03:40,840 Speaker 1: their movement? You know they are there are very little risk. 69 00:03:40,880 --> 00:03:42,720 Speaker 1: I mean, the one thing we know from the vaccines, 70 00:03:42,760 --> 00:03:45,640 Speaker 1: the experience in Israel and in other countries essay, as 71 00:03:45,680 --> 00:03:49,000 Speaker 1: you begin to vaccinate large proportions of the population, the 72 00:03:49,120 --> 00:03:51,800 Speaker 1: risk of serious illness, the risk of hospitalizations, and the 73 00:03:51,880 --> 00:03:56,040 Speaker 1: risk of death fatalities almost collapses, certainly falls to very 74 00:03:56,040 --> 00:03:58,520 Speaker 1: low levels. Now we're only locking up at the moment 75 00:03:58,600 --> 00:04:01,200 Speaker 1: not to limit the spread of cod it, but actually 76 00:04:01,240 --> 00:04:04,240 Speaker 1: to eliminate the risk that COVID cases will overwhelm the 77 00:04:04,280 --> 00:04:09,160 Speaker 1: hospital service and health systems which beliminate that risk with vaccinations. Frankly, 78 00:04:09,160 --> 00:04:11,080 Speaker 1: I think people are going to rebel. They're not good 79 00:04:11,080 --> 00:04:13,960 Speaker 1: to be willing to be locked up. Those kids are 80 00:04:14,000 --> 00:04:16,560 Speaker 1: not going to stay home from school. Life will return 81 00:04:16,640 --> 00:04:19,800 Speaker 1: to normal, and I think COVID will be comm I mean, 82 00:04:19,800 --> 00:04:21,320 Speaker 1: it will still be with us, but it would be 83 00:04:21,440 --> 00:04:24,560 Speaker 1: much more. I think similar to the annual flu, the 84 00:04:24,640 --> 00:04:28,920 Speaker 1: annual cold. Because of the success and vaccinations. Well, Michael, 85 00:04:28,920 --> 00:04:30,560 Speaker 1: as you know, they might rebel, but right now it's 86 00:04:30,560 --> 00:04:32,760 Speaker 1: illegal to go on holiday. So and still that's lifted. 87 00:04:32,800 --> 00:04:34,680 Speaker 1: We've got a problem. So my question to you would 88 00:04:34,720 --> 00:04:36,920 Speaker 1: be how hard are you lobbying on a vaccine passport 89 00:04:36,960 --> 00:04:40,240 Speaker 1: issue and how close our way to a breakthrough? Well, 90 00:04:40,240 --> 00:04:42,200 Speaker 1: I mean, as you know, Johnason league to drive over 91 00:04:42,240 --> 00:04:44,080 Speaker 1: the speed limit, but lots of people do it too. 92 00:04:44,160 --> 00:04:48,840 Speaker 1: You know, again you're telling me that your summer is 93 00:04:48,880 --> 00:04:51,480 Speaker 1: reliant upon people rebelling and getting on the plane and 94 00:04:51,520 --> 00:04:54,000 Speaker 1: breaking the law. No, I mean I was going to 95 00:04:54,040 --> 00:04:56,080 Speaker 1: move on to say, you know, sure, be long hole 96 00:04:56,200 --> 00:04:59,120 Speaker 1: travel will be much more restricted, but you have free 97 00:04:59,120 --> 00:05:02,119 Speaker 1: movement of Pepe within the European Union and in large 98 00:05:02,120 --> 00:05:05,200 Speaker 1: amation between the UK and Europe as well. Now I 99 00:05:05,200 --> 00:05:07,000 Speaker 1: think there's finding a time to get to the end 100 00:05:07,000 --> 00:05:08,640 Speaker 1: of mayor in the June. You have all of the 101 00:05:08,720 --> 00:05:12,520 Speaker 1: high risk categories, the elderly, the obese, the infirm have 102 00:05:12,640 --> 00:05:16,120 Speaker 1: been vaccinated. Eighty percent of the annual population have been vaccinated. 103 00:05:16,360 --> 00:05:19,599 Speaker 1: The children had a lower rate of catching code, but 104 00:05:19,600 --> 00:05:22,520 Speaker 1: don't suffer serious illness anyway. What would be the base 105 00:05:22,640 --> 00:05:26,720 Speaker 1: on with UK governments would be finding people moving around Europe, 106 00:05:26,720 --> 00:05:29,479 Speaker 1: where by we're intacted to the free movement of people, 107 00:05:29,560 --> 00:05:33,560 Speaker 1: so again, be careful. I think short Hauld domestically within 108 00:05:33,600 --> 00:05:36,000 Speaker 1: the US will be there will be the very few 109 00:05:36,040 --> 00:05:39,200 Speaker 1: restrictions this summer, and short Hall, I would say within 110 00:05:39,240 --> 00:05:41,760 Speaker 1: the European unions there would be very few restrictions. Michael, 111 00:05:41,760 --> 00:05:45,320 Speaker 1: long Hole will continue to be restrictions. Yes, guys, Sorry Michael. 112 00:05:45,360 --> 00:05:47,400 Speaker 1: You're clearly focused on the summer season, which is going 113 00:05:47,440 --> 00:05:50,880 Speaker 1: to be the holiday for the kids. But nevertheless, short 114 00:05:50,920 --> 00:05:53,560 Speaker 1: Hole is driven by younger demographics and they are going 115 00:05:53,600 --> 00:05:55,960 Speaker 1: to be the last to get the vaccines. Is that 116 00:05:56,040 --> 00:05:58,479 Speaker 1: going to be a problem. No, I mean again, a 117 00:05:58,520 --> 00:06:00,960 Speaker 1: summer holidays tend to be driven by families. You know, 118 00:06:01,000 --> 00:06:05,520 Speaker 1: it's the school holidays across eurotypically start through June, July August. 119 00:06:05,560 --> 00:06:08,320 Speaker 1: That's when the schools are off, That's when families are moving. 120 00:06:08,720 --> 00:06:12,360 Speaker 1: The young people are generally working at that point in time, generally, 121 00:06:12,400 --> 00:06:16,080 Speaker 1: hopefully in the hospitality of jurism industry. I think that's 122 00:06:16,080 --> 00:06:20,240 Speaker 1: what we'll drive the recovery. And then, you know, everybody 123 00:06:20,440 --> 00:06:22,799 Speaker 1: predicts that Europe will be a washed with drag scenes 124 00:06:22,880 --> 00:06:25,039 Speaker 1: through May June July, and we're not about sure what 125 00:06:25,120 --> 00:06:27,200 Speaker 1: the date will actually be. And I do accept that 126 00:06:27,200 --> 00:06:29,719 Speaker 1: the date has moved backwards, but we still see that 127 00:06:29,760 --> 00:06:33,640 Speaker 1: there's sufficient time and sufficient vaccination room left run. You know, 128 00:06:33,680 --> 00:06:36,040 Speaker 1: we still have April, May and June to go to 129 00:06:36,240 --> 00:06:40,080 Speaker 1: allow us to recover the holiday season in Europe through 130 00:06:40,200 --> 00:06:43,159 Speaker 1: July Augus and the general Michael, let's make some producers nervous. 131 00:06:43,160 --> 00:06:45,120 Speaker 1: We've got forty five seconds left play with me, just 132 00:06:45,160 --> 00:06:47,640 Speaker 1: for a moment. Chancellor Miracle says she's made a mistake, 133 00:06:47,720 --> 00:06:50,160 Speaker 1: just backing down from that East of lockdown. Your response 134 00:06:50,200 --> 00:06:52,640 Speaker 1: to that this morning, I mean, I try not to 135 00:06:52,680 --> 00:06:56,359 Speaker 1: respond to the instantaneous comments of politicians. We're planning. We 136 00:06:56,360 --> 00:06:58,920 Speaker 1: announced new rooms this morning from the UK for the 137 00:06:58,960 --> 00:07:02,040 Speaker 1: European Peak. We extract to run most of the changes 138 00:07:02,080 --> 00:07:04,640 Speaker 1: through July over September, where reason to be content with 139 00:07:04,680 --> 00:07:07,400 Speaker 1: that kind of overlook. Michael, comeback soon, stay close it's 140 00:07:07,400 --> 00:07:10,560 Speaker 1: always greater catch Larry. Good to see you, sir, Ryan 141 00:07:10,680 --> 00:07:18,840 Speaker 1: s CEO greased to say we can head down to 142 00:07:18,880 --> 00:07:22,440 Speaker 1: Washington now to catch up with Congressman Don Buyer, Democrat 143 00:07:22,480 --> 00:07:25,720 Speaker 1: from Virginia and chair of the Joint Economic Committee. Congressman, 144 00:07:25,800 --> 00:07:27,200 Speaker 1: great to catch up with you, sir. I want to 145 00:07:27,200 --> 00:07:29,960 Speaker 1: stablish as the last twenty four hours of we can, 146 00:07:30,400 --> 00:07:32,760 Speaker 1: there was supposed to be a hearing just to go 147 00:07:32,840 --> 00:07:36,560 Speaker 1: through some of the priorities for a bipartisan infrastructure proposal, 148 00:07:36,600 --> 00:07:38,560 Speaker 1: which Republicans didn't want to take part in. And I 149 00:07:38,640 --> 00:07:40,760 Speaker 1: want to read a quote from Republican Kevin Brady who 150 00:07:40,760 --> 00:07:43,320 Speaker 1: said the following. In our view, today's hearing is nothing 151 00:07:43,360 --> 00:07:46,440 Speaker 1: more than another partisan exercise so the Democrat House leadership 152 00:07:46,480 --> 00:07:49,400 Speaker 1: can set up yet another multi trillion dollar, one sided 153 00:07:49,760 --> 00:07:52,280 Speaker 1: spending bill. Congressman, can you tell us why it's more 154 00:07:52,280 --> 00:07:56,920 Speaker 1: sincere than that. I was really disappointed in Ranking Member 155 00:07:56,960 --> 00:07:59,720 Speaker 1: Brady's comments because it didn't seem to have any connection 156 00:07:59,760 --> 00:08:03,000 Speaker 1: to reality. We invited all the Democrats and all the 157 00:08:03,040 --> 00:08:06,440 Speaker 1: Republicans to come tell us what their priorities should be 158 00:08:06,440 --> 00:08:09,680 Speaker 1: in this next infrastructure bill, and I think Kevin Brady 159 00:08:09,720 --> 00:08:12,120 Speaker 1: knows that there are many Democrats, including me, that hope 160 00:08:12,120 --> 00:08:16,200 Speaker 1: that this bill is mostly are largely paid for. So 161 00:08:16,280 --> 00:08:18,080 Speaker 1: this is you know, this is a once in a 162 00:08:18,160 --> 00:08:21,720 Speaker 1: generation infrastructure bill that we love to have everybody's input for. 163 00:08:22,080 --> 00:08:24,400 Speaker 1: By the way, it's gonna affect all those Republican districts 164 00:08:24,400 --> 00:08:26,679 Speaker 1: to it early major ways. Let's talk about what's happened 165 00:08:26,680 --> 00:08:28,400 Speaker 1: previously in the last couple of months. Do you think 166 00:08:28,440 --> 00:08:30,280 Speaker 1: they have been conditioned by the approach to the one 167 00:08:30,320 --> 00:08:33,400 Speaker 1: point nine trillion dollar bill where many Republicans found totally 168 00:08:33,400 --> 00:08:37,400 Speaker 1: frozen out of the process. Yeah, although I kind I 169 00:08:37,400 --> 00:08:39,480 Speaker 1: don't think they were frozen out of the process. There 170 00:08:39,480 --> 00:08:43,440 Speaker 1: were extensive markups on this. You know that the most 171 00:08:43,440 --> 00:08:46,520 Speaker 1: controversial part for them was the four dollars which came 172 00:08:46,559 --> 00:08:50,079 Speaker 1: from their president, Donald Trump. And by the way, is 173 00:08:50,400 --> 00:08:53,760 Speaker 1: affecting all their folks. We have the there's a big piece. 174 00:08:53,800 --> 00:08:56,880 Speaker 1: They were against the state and local government funding. The 175 00:08:56,920 --> 00:09:00,280 Speaker 1: best of my knowledge, no Republican governor, Republican or has 176 00:09:00,320 --> 00:09:04,640 Speaker 1: refused to accept these funds to strengthen their communities. It 177 00:09:04,720 --> 00:09:07,680 Speaker 1: was again, it was a wildly popular bill, is a 178 00:09:07,679 --> 00:09:12,600 Speaker 1: wildly popular bill among all Americans, including Republican Americans. Just 179 00:09:12,720 --> 00:09:16,960 Speaker 1: not their elected officials in Washington, Congressman, you said that 180 00:09:17,080 --> 00:09:19,680 Speaker 1: they were presented with a bill that was mostly or 181 00:09:19,800 --> 00:09:22,760 Speaker 1: largely paid for, But isn't that the issue? The way 182 00:09:22,760 --> 00:09:26,200 Speaker 1: that it's being paid for through tax hikes on wealthier 183 00:09:26,200 --> 00:09:29,360 Speaker 1: individuals and on corporations is something that Republicans have said 184 00:09:29,679 --> 00:09:31,480 Speaker 1: is a no go for them, that they don't want 185 00:09:31,520 --> 00:09:37,200 Speaker 1: to do. How are you going to reconcile that issue? Well, yeah, 186 00:09:37,440 --> 00:09:40,240 Speaker 1: I don't know how we're going to reconcile, and I 187 00:09:40,280 --> 00:09:42,199 Speaker 1: think we just have to come after with the facts. 188 00:09:42,600 --> 00:09:45,400 Speaker 1: At least we did a hearing before the pandemic on 189 00:09:45,480 --> 00:09:49,240 Speaker 1: infrastructure in ways of means, we're virtually every Democrat and 190 00:09:49,320 --> 00:09:51,640 Speaker 1: Republicans said we need to have a way to pay 191 00:09:51,679 --> 00:09:55,040 Speaker 1: for this and needs to be sustainable. Well, we know 192 00:09:55,120 --> 00:09:57,360 Speaker 1: that the gas tax is a is a no starter 193 00:09:57,480 --> 00:10:00,559 Speaker 1: for many different reasons. But we also saw yesterday that 194 00:10:01,480 --> 00:10:05,000 Speaker 1: US corporate affective tax rate last year was seven point 195 00:10:05,080 --> 00:10:08,439 Speaker 1: eight percent after the j c T A that had 196 00:10:08,480 --> 00:10:11,240 Speaker 1: the top one percent had their networth increased by four 197 00:10:11,360 --> 00:10:16,439 Speaker 1: trillion dollars or or just the New York Times editorial 198 00:10:16,640 --> 00:10:21,080 Speaker 1: on Sunday about how you know personal income is almost 199 00:10:21,080 --> 00:10:24,720 Speaker 1: all reported in tax but a huge part of business 200 00:10:24,800 --> 00:10:28,559 Speaker 1: income is not to the tune of six fifty billion 201 00:10:28,600 --> 00:10:31,520 Speaker 1: dollars or one point six trillion dollars a year I 202 00:10:31,559 --> 00:10:34,160 Speaker 1: think was the New York Times number. There's a lot 203 00:10:34,200 --> 00:10:36,360 Speaker 1: of low hanging for it out there that wouldn't affect 204 00:10:36,360 --> 00:10:40,559 Speaker 1: the economy. Congressmen, and these are points that are widely 205 00:10:40,600 --> 00:10:44,679 Speaker 1: accepted among Democrats. However, there are Republicans that come back 206 00:10:44,720 --> 00:10:46,760 Speaker 1: and they say, look, you're going to prevent a certain 207 00:10:46,800 --> 00:10:50,320 Speaker 1: amount of dynamism investment in things like infrastructure just by 208 00:10:50,360 --> 00:10:53,640 Speaker 1: the corporations themselves if they have to pay higher taxes. 209 00:10:53,679 --> 00:10:55,920 Speaker 1: And we can debate that till the cows come home. 210 00:10:55,960 --> 00:10:58,960 Speaker 1: But the question really here is is there any wiggle 211 00:10:59,040 --> 00:11:02,480 Speaker 1: room to negotiate and higher taxes with Republicans or is 212 00:11:02,480 --> 00:11:04,560 Speaker 1: it going to have to be done without any of 213 00:11:04,559 --> 00:11:09,200 Speaker 1: their support. Well, I wish there were wiggle room. I 214 00:11:09,320 --> 00:11:13,959 Speaker 1: think one place Lisa that might be fruitful is looking 215 00:11:13,960 --> 00:11:17,840 Speaker 1: at carbon pricing. And now that the American Patroleum Institute, 216 00:11:17,840 --> 00:11:20,560 Speaker 1: along with Exxon Mobile and others, and the Business round 217 00:11:20,600 --> 00:11:23,080 Speaker 1: Table and the Use Chamber, we've all said that carbon 218 00:11:23,160 --> 00:11:25,920 Speaker 1: pricing should be on the table, maybe we can get 219 00:11:25,920 --> 00:11:28,480 Speaker 1: Republicans to do that and at a minimum pay for 220 00:11:29,200 --> 00:11:31,959 Speaker 1: you know, the roads and bridges and asphalt and stuff 221 00:11:31,960 --> 00:11:33,760 Speaker 1: that they really like. In conversement, what do you think 222 00:11:33,760 --> 00:11:36,120 Speaker 1: the ultimate approach now is then? Do you think it 223 00:11:36,200 --> 00:11:41,080 Speaker 1: is a series of smaller bills or still one launch bill? Jonathan? 224 00:11:41,120 --> 00:11:44,800 Speaker 1: I prefer one large bill, But I'm a I'm agnostic 225 00:11:44,840 --> 00:11:47,000 Speaker 1: whatever it takes to get the job done. I know 226 00:11:47,800 --> 00:11:50,000 Speaker 1: drifting around is the idea that you take things you 227 00:11:50,000 --> 00:11:54,080 Speaker 1: could get Republicans on board with, like highways and roads, bridges, 228 00:11:54,600 --> 00:11:57,840 Speaker 1: and do that with their votes, and then the other 229 00:11:57,920 --> 00:12:01,600 Speaker 1: more controversial things. Although why odd band and electrical grid 230 00:12:01,640 --> 00:12:04,760 Speaker 1: modernization should be controversial? Uh, you may have to do 231 00:12:04,800 --> 00:12:08,040 Speaker 1: that through through reconciliation. You are one other bite at 232 00:12:08,080 --> 00:12:12,200 Speaker 1: the reconciliation apple this year Congress. Before we let you go, 233 00:12:12,320 --> 00:12:14,360 Speaker 1: I want to ask you about bitcoin. We've got Tesla 234 00:12:14,440 --> 00:12:17,280 Speaker 1: now accepting bitcoin is a form of payment. What's the 235 00:12:17,280 --> 00:12:21,880 Speaker 1: regulatory front when it comes to that crypto asset, Lisa, 236 00:12:22,160 --> 00:12:25,080 Speaker 1: We're about to dive into that deeply. I think there 237 00:12:25,120 --> 00:12:28,520 Speaker 1: needs to be when you get a completely unregulated currency. 238 00:12:29,280 --> 00:12:34,920 Speaker 1: While it's exciting and interesting, um, the possibilities for yeah, 239 00:12:35,040 --> 00:12:39,280 Speaker 1: everybody from terrorists to to uh international mafia type things 240 00:12:39,360 --> 00:12:42,800 Speaker 1: using it or people just avoiding taxes on a large 241 00:12:42,800 --> 00:12:46,200 Speaker 1: scale are very real. So I can't tell you what 242 00:12:46,200 --> 00:12:49,360 Speaker 1: the regulation is going to be, but it's worth very 243 00:12:49,400 --> 00:12:51,719 Speaker 1: deep dives this year by congress A. Comressman. If I 244 00:12:51,760 --> 00:12:54,720 Speaker 1: shout walks, do we create some trouble there in your house? 245 00:12:55,760 --> 00:12:59,160 Speaker 1: The duck out? He really does want to go outside? 246 00:12:59,240 --> 00:13:01,320 Speaker 1: You I can tell. Let you go, sir, Congressman. It's 247 00:13:01,360 --> 00:13:03,520 Speaker 1: good to see you. Stay close. It's going to catch up. 248 00:13:03,720 --> 00:13:11,760 Speaker 1: Congressman's on via there, Virginia. Thank you. Let's turn to 249 00:13:11,760 --> 00:13:15,199 Speaker 1: Mind Mahajan, now the Nsclobe and Investors US investment strategist. 250 00:13:15,240 --> 00:13:17,280 Speaker 1: She joins, US might a great to catch up. As 251 00:13:17,320 --> 00:13:19,160 Speaker 1: you've said, we started to see some fatigue in the 252 00:13:19,200 --> 00:13:22,120 Speaker 1: big winners through the last year, going back to late 253 00:13:22,200 --> 00:13:25,040 Speaker 1: October as well. I'm trying to understand how you approach 254 00:13:25,040 --> 00:13:27,800 Speaker 1: your market like this one right now, huge rip since 255 00:13:27,840 --> 00:13:30,560 Speaker 1: the end of October, you start to see fatigue. How 256 00:13:30,559 --> 00:13:33,640 Speaker 1: do you approach what you see on the screen. Yeah. Absolutely, Look, 257 00:13:33,679 --> 00:13:35,920 Speaker 1: I think it's been a phenomenal market since really last 258 00:13:35,960 --> 00:13:39,960 Speaker 1: March of UM this year one has really been a 259 00:13:40,000 --> 00:13:43,680 Speaker 1: story of the reopening trade, that value trade, the rotation 260 00:13:43,800 --> 00:13:47,160 Speaker 1: into value into the reopening stories, and out of really 261 00:13:47,200 --> 00:13:50,240 Speaker 1: that growth in some of those large cap COVID winners 262 00:13:50,559 --> 00:13:53,040 Speaker 1: from last year. Of course, over the last few days 263 00:13:53,040 --> 00:13:55,199 Speaker 1: you've seen a bit of reversal of that because rates 264 00:13:55,240 --> 00:13:57,640 Speaker 1: have started to come down a little. Maybe there's some 265 00:13:57,720 --> 00:14:01,200 Speaker 1: questions around the reopening, given new of variants, given news 266 00:14:01,240 --> 00:14:04,680 Speaker 1: of some states seeing rising cases, clearly given what's happening 267 00:14:04,679 --> 00:14:06,560 Speaker 1: in Europe, so we're starting to see a little bit 268 00:14:06,600 --> 00:14:10,520 Speaker 1: of pause around that reopening value cyclical trade. Um what 269 00:14:10,640 --> 00:14:13,240 Speaker 1: we're thinking about, of course is as we're heading to 270 00:14:13,280 --> 00:14:16,400 Speaker 1: this summer of really that real unleashing of pent up 271 00:14:16,400 --> 00:14:19,880 Speaker 1: demand by the consumer and perhaps the real unleashing of 272 00:14:19,920 --> 00:14:24,000 Speaker 1: the stimulus really flowing through the system, we may see 273 00:14:24,080 --> 00:14:27,440 Speaker 1: this value cyclical rally have one more leg or maybe 274 00:14:27,480 --> 00:14:30,160 Speaker 1: some legs through the summer. But what we're really thinking 275 00:14:30,160 --> 00:14:32,920 Speaker 1: about then towards the second half of this year are 276 00:14:32,960 --> 00:14:35,840 Speaker 1: some of the risks on the horizon, and those include one, 277 00:14:36,320 --> 00:14:38,320 Speaker 1: you know, peak reopening. At some point you're going to 278 00:14:38,400 --> 00:14:40,400 Speaker 1: get a peak growth rate. Maybe it's two q maybe 279 00:14:40,400 --> 00:14:42,600 Speaker 1: it's three q UM, but that at that point the 280 00:14:42,600 --> 00:14:45,560 Speaker 1: second relative starts to to slow again in terms of 281 00:14:45,640 --> 00:14:48,720 Speaker 1: GDP growth. The second, of course is we do think 282 00:14:48,760 --> 00:14:52,760 Speaker 1: that yields have you know, can continue to grind higher. UM. 283 00:14:52,760 --> 00:14:55,280 Speaker 1: We do think that the two handle on the tenure 284 00:14:55,480 --> 00:14:58,280 Speaker 1: is feasible this year, and so that will cause some 285 00:14:58,320 --> 00:15:01,960 Speaker 1: additional volatility and pressure. And then finally and thirdly of course, 286 00:15:02,080 --> 00:15:05,040 Speaker 1: is a FED who has been quite accommodated thus far. 287 00:15:05,680 --> 00:15:07,480 Speaker 1: We think that continues for most of this year, but 288 00:15:07,640 --> 00:15:09,960 Speaker 1: at some point they're going to have to come off 289 00:15:09,960 --> 00:15:12,880 Speaker 1: this crisis level accommodation that they've been writing. So this 290 00:15:12,960 --> 00:15:16,760 Speaker 1: was really rates at the zero bound unlimited queue to 291 00:15:16,840 --> 00:15:19,600 Speaker 1: some extent to really help at the heart of the pandemic. 292 00:15:20,080 --> 00:15:22,560 Speaker 1: We're now clearly trying to re emerge from that. So, 293 00:15:22,920 --> 00:15:25,200 Speaker 1: you know, some things you're thinking about. A lot of 294 00:15:25,760 --> 00:15:28,040 Speaker 1: the good news, a lot of the reopening story, a 295 00:15:28,040 --> 00:15:30,560 Speaker 1: lot of this value trade is starting to get priced 296 00:15:30,600 --> 00:15:33,160 Speaker 1: in UM. So keep in mind, if you haven't yet, 297 00:15:33,640 --> 00:15:36,800 Speaker 1: you do have an opportunity to to you know, tactically 298 00:15:36,880 --> 00:15:39,680 Speaker 1: layer in sencyclicality, but just be mindful. Then as you're 299 00:15:39,680 --> 00:15:41,480 Speaker 1: heading towards the second half of the here money you've 300 00:15:41,440 --> 00:15:43,040 Speaker 1: gone through a lot of issues there. Everyone's got their 301 00:15:43,080 --> 00:15:45,520 Speaker 1: own approach, their own process to work through. A lot 302 00:15:45,520 --> 00:15:47,440 Speaker 1: of people talk about where we are in the cycle. 303 00:15:47,560 --> 00:15:50,960 Speaker 1: The early trade is the early cycle playbook still with us? 304 00:15:51,160 --> 00:15:53,280 Speaker 1: Is that going to last another few months, maybe another 305 00:15:53,320 --> 00:15:56,040 Speaker 1: quarter or another few quarters? Morgan Stanley think we've already 306 00:15:56,040 --> 00:15:58,360 Speaker 1: seen the early cycle move. Do you use the same 307 00:15:58,400 --> 00:16:01,240 Speaker 1: approach Mona? Do you have that early cycle playbook? And 308 00:16:01,320 --> 00:16:04,680 Speaker 1: when the cycle do you think were on this market? Yeah? Absolutely, 309 00:16:04,720 --> 00:16:07,440 Speaker 1: I think we are re emerging from a recessionary environment. 310 00:16:07,440 --> 00:16:09,640 Speaker 1: And of course this recession is is different from some 311 00:16:09,680 --> 00:16:11,720 Speaker 1: of the others, which are more you know, rates driven 312 00:16:11,840 --> 00:16:14,200 Speaker 1: or more consumer driven. This was a pandemic and a 313 00:16:14,240 --> 00:16:17,200 Speaker 1: health crisis, but we're clearly re emerging from it, and 314 00:16:17,280 --> 00:16:20,400 Speaker 1: that that playbook actually came to fruition in a very 315 00:16:20,400 --> 00:16:24,640 Speaker 1: real way this year. So certainly areas like energy, financials, industrial, 316 00:16:24,640 --> 00:16:28,920 Speaker 1: specilical stocks, the reopening place, uh, those all took a 317 00:16:29,040 --> 00:16:31,240 Speaker 1: nice light higher and so a lot of you know, 318 00:16:32,000 --> 00:16:35,320 Speaker 1: what they call the easy money perhaps has been made. 319 00:16:35,400 --> 00:16:37,600 Speaker 1: But that being said, you know, we do think that 320 00:16:37,960 --> 00:16:41,560 Speaker 1: um the earnings growth environment, there's still upside to some 321 00:16:41,640 --> 00:16:44,600 Speaker 1: of the numbers that we're seeing at there especially on UM. 322 00:16:44,640 --> 00:16:47,800 Speaker 1: Some of these sectors like financials, like energy, like industrials, 323 00:16:48,320 --> 00:16:51,080 Speaker 1: some of the areas that do well as rates continue 324 00:16:51,120 --> 00:16:53,600 Speaker 1: to grind higher. Of course, financials, especially with a steeper 325 00:16:53,640 --> 00:16:57,320 Speaker 1: year field curve. UM. We think areas like industrials may 326 00:16:57,320 --> 00:16:59,800 Speaker 1: have some legs given the infrastructure package that we think 327 00:17:00,000 --> 00:17:02,600 Speaker 1: will start to come to the forefront in the weeks ahead. 328 00:17:03,120 --> 00:17:05,680 Speaker 1: Even areas like clean energy, which has been a real 329 00:17:05,720 --> 00:17:08,720 Speaker 1: focus of the Biden administration and has now sold off 330 00:17:08,760 --> 00:17:10,840 Speaker 1: as the NAZAC has sold off. As a lot of 331 00:17:10,880 --> 00:17:13,800 Speaker 1: the growth stories have sold off, UM could have another lead. 332 00:17:13,840 --> 00:17:16,719 Speaker 1: We think that's a secular growth theme that that if 333 00:17:16,760 --> 00:17:18,840 Speaker 1: you haven't yet had explored, which was it's an interesting 334 00:17:18,880 --> 00:17:21,560 Speaker 1: one here. So UM certainly we're looking at it more 335 00:17:21,600 --> 00:17:24,919 Speaker 1: from now, a more active approach, taking a sector you know, 336 00:17:25,000 --> 00:17:28,560 Speaker 1: by sector positioning approach rather than a broad market approach. 337 00:17:28,600 --> 00:17:30,080 Speaker 1: And so I think, you know, at this point in 338 00:17:30,080 --> 00:17:33,439 Speaker 1: the cycle, after we've had this reopening rally, we have 339 00:17:33,480 --> 00:17:36,880 Speaker 1: to really be more selective going forward. Just to be clear, Mona, 340 00:17:37,119 --> 00:17:39,760 Speaker 1: is the reopening rally done. If we reached a plateau 341 00:17:40,119 --> 00:17:41,840 Speaker 1: and we're just going to fluctuate from here, is that 342 00:17:41,880 --> 00:17:43,920 Speaker 1: what you're saying, you know, I think that that there 343 00:17:44,000 --> 00:17:45,960 Speaker 1: is one like higher and you know, if you think 344 00:17:45,960 --> 00:17:49,359 Speaker 1: about seasonality, sometimes it's sell in May and go away, 345 00:17:49,400 --> 00:17:52,239 Speaker 1: but generally this year, I think, um, you know, when 346 00:17:52,280 --> 00:17:54,959 Speaker 1: you look anecdotally, those summer months are really when we're 347 00:17:54,960 --> 00:17:57,280 Speaker 1: going to see um, that pent up demand on leach. 348 00:17:57,359 --> 00:18:00,000 Speaker 1: So you know, the consumers will hopefully have the next 349 00:18:00,040 --> 00:18:03,080 Speaker 1: round of stimulus checks in their pockets. Uh, the vaccination 350 00:18:03,160 --> 00:18:05,800 Speaker 1: program here in the US will be more fully rolled out, 351 00:18:06,119 --> 00:18:08,680 Speaker 1: and so you'll really see them that demand for areas 352 00:18:08,760 --> 00:18:12,159 Speaker 1: like travel like um, you know, going back indoors, perhaps 353 00:18:12,200 --> 00:18:15,399 Speaker 1: even two restaurants, going to sporting events. And so I 354 00:18:15,400 --> 00:18:19,480 Speaker 1: think that when when the economy really is going through 355 00:18:19,520 --> 00:18:23,719 Speaker 1: that hyper demand phase, we'll see the market actually react 356 00:18:23,760 --> 00:18:25,960 Speaker 1: to that. But that's when you have to start thinking about, well, 357 00:18:26,000 --> 00:18:28,880 Speaker 1: after that, what happens are we at peak reopening? And 358 00:18:29,200 --> 00:18:31,680 Speaker 1: so I think, you know, you probably have a little 359 00:18:31,680 --> 00:18:34,720 Speaker 1: bit of steam left in this rally, um, but it's 360 00:18:34,840 --> 00:18:37,200 Speaker 1: it's probably time to start thinking about being a little 361 00:18:37,200 --> 00:18:39,520 Speaker 1: bit more neutral or cautious as we had passed the 362 00:18:39,520 --> 00:18:42,679 Speaker 1: summer months. You used one line in this conversation that 363 00:18:42,720 --> 00:18:44,920 Speaker 1: always pops out jumps out to me when people say 364 00:18:44,920 --> 00:18:47,760 Speaker 1: the easy money monitor, and you know I always pick 365 00:18:47,880 --> 00:18:50,080 Speaker 1: up on it, so forgive me for doing so. Did 366 00:18:50,080 --> 00:18:53,240 Speaker 1: it ever feel easy? You know? Ever since March of 367 00:18:53,359 --> 00:18:56,040 Speaker 1: last year, it's felt a little bit tough, and so 368 00:18:56,200 --> 00:18:58,399 Speaker 1: I think, you know that the whole dichotomy between Main 369 00:18:58,440 --> 00:19:00,280 Speaker 1: Street and Wall Street has always been a tough point 370 00:19:00,320 --> 00:19:03,040 Speaker 1: to to follow. But I certainly think in this case, 371 00:19:03,480 --> 00:19:06,439 Speaker 1: the markets have been very forward looking, and perhaps they 372 00:19:06,480 --> 00:19:09,520 Speaker 1: were really since last year looking towards the second half 373 00:19:09,560 --> 00:19:12,520 Speaker 1: of one, and so they were very astute in realizing 374 00:19:12,560 --> 00:19:14,840 Speaker 1: that at some point we will have a program in 375 00:19:14,840 --> 00:19:17,080 Speaker 1: place that will help us get through the pandemic to 376 00:19:17,200 --> 00:19:21,080 Speaker 1: reopen fully um And and interestingly, the retail investor last 377 00:19:21,119 --> 00:19:23,119 Speaker 1: year played a very large role in that. So you know, 378 00:19:23,119 --> 00:19:25,879 Speaker 1: the util investor in some way was the winner in 379 00:19:27,200 --> 00:19:30,560 Speaker 1: really kind of kept you know, kept that optimistic outlook 380 00:19:31,200 --> 00:19:33,880 Speaker 1: throughout the year, and so they really benefited from that. So, yes, 381 00:19:33,960 --> 00:19:37,639 Speaker 1: we've had an optimistic reopening trade, you could argue since 382 00:19:37,680 --> 00:19:41,320 Speaker 1: perhaps March April of last year. So hopefully, you know, 383 00:19:41,359 --> 00:19:44,840 Speaker 1: most investors participated in some way, and that the good 384 00:19:44,880 --> 00:19:47,320 Speaker 1: news was last year, if you had the growth stocks 385 00:19:47,480 --> 00:19:51,159 Speaker 1: um this year you could actually have some opportunities in 386 00:19:51,200 --> 00:19:54,320 Speaker 1: the value stocks, and so that's why we think there 387 00:19:54,440 --> 00:19:56,399 Speaker 1: is still a little bit more catch up and perhaps 388 00:19:56,400 --> 00:19:59,280 Speaker 1: a little bit more rebound to to go in that sector. 389 00:19:59,320 --> 00:20:02,080 Speaker 1: If you think about a lot of these value names 390 00:20:02,119 --> 00:20:06,639 Speaker 1: like financials, energy industrials, they are still slightly up to 391 00:20:06,720 --> 00:20:09,280 Speaker 1: March of last year, and so they have some catch 392 00:20:09,320 --> 00:20:12,640 Speaker 1: up to do to the NAZAC, which is up from 393 00:20:12,680 --> 00:20:18,720 Speaker 1: its February highs. So UM interesting markets still one where 394 00:20:18,760 --> 00:20:21,159 Speaker 1: you know, again you know, just be selective, be active, 395 00:20:21,200 --> 00:20:23,920 Speaker 1: but you still have some opportunities to go. It's never 396 00:20:23,920 --> 00:20:28,600 Speaker 1: easy catch up, you know, it's never exactly. Aliance Global 397 00:20:28,640 --> 00:20:37,639 Speaker 1: Investors US investment strategist, let's bring in Toasten Slock, Apollo 398 00:20:37,640 --> 00:20:41,600 Speaker 1: Global Management chief economist, Torsten. You've seen your old colleagues, 399 00:20:41,640 --> 00:20:44,200 Speaker 1: your old peers put out their forecast for growth for 400 00:20:44,320 --> 00:20:49,680 Speaker 1: GDP for one six handles, seven handles, big numbers. Can 401 00:20:49,720 --> 00:20:52,679 Speaker 1: we just start with the deceleration you anticipate from twenty 402 00:20:52,680 --> 00:20:55,600 Speaker 1: one to twenty two and beyond absolutely, John that I 403 00:20:55,720 --> 00:20:58,280 Speaker 1: think that the number we just got is a very 404 00:20:58,280 --> 00:21:00,480 Speaker 1: important data point because it does to us that it 405 00:21:00,520 --> 00:21:03,919 Speaker 1: is premature to talk about overheating. We have seen, of 406 00:21:03,960 --> 00:21:07,840 Speaker 1: course the reopening trade do will. But as j Pal 407 00:21:08,080 --> 00:21:10,320 Speaker 1: has said yesterday and he's probably sure you're also going 408 00:21:10,359 --> 00:21:12,479 Speaker 1: to say today, is that we are still almost tenderent 409 00:21:12,560 --> 00:21:15,359 Speaker 1: jobs behind creatives that we were in total employment in 410 00:21:15,400 --> 00:21:17,919 Speaker 1: February of two thousands winning. So the bottom line is 411 00:21:17,960 --> 00:21:21,320 Speaker 1: that we will have a very strong growth numbers over 412 00:21:21,359 --> 00:21:24,600 Speaker 1: the next few quarters as the reopening begins to play out, 413 00:21:24,880 --> 00:21:28,800 Speaker 1: as the fiscal stimulus supports, and also both households and 414 00:21:28,840 --> 00:21:30,600 Speaker 1: corporates have a lot of cash on the energies that 415 00:21:30,640 --> 00:21:32,880 Speaker 1: they're going to spend. So these three tail winds will 416 00:21:32,920 --> 00:21:35,520 Speaker 1: give quite a boost to GDP growth. But the key 417 00:21:35,520 --> 00:21:38,480 Speaker 1: word here, as you're saying, Jonathan, is the deceleration and 418 00:21:38,520 --> 00:21:41,520 Speaker 1: growth is important. Naming for marketing becomes critical to figure 419 00:21:41,560 --> 00:21:43,919 Speaker 1: out the timing and when is the peak and growth, 420 00:21:43,960 --> 00:21:45,680 Speaker 1: and we will begin to see the numbers begin to 421 00:21:45,720 --> 00:21:50,080 Speaker 1: slow down. We often speak as growth and inflation sort 422 00:21:50,119 --> 00:21:53,239 Speaker 1: of in tandem, and yet there are distinct aspects of 423 00:21:53,280 --> 00:21:56,000 Speaker 1: this economy. Could we see a situation where we have 424 00:21:56,240 --> 00:21:59,919 Speaker 1: very robust growth and inflation that still remains within the 425 00:22:00,119 --> 00:22:04,800 Speaker 1: range that the FED is expecting, which is pretty low. Absolutely. 426 00:22:05,119 --> 00:22:07,960 Speaker 1: I mean there's a number of one all factors, including 427 00:22:08,040 --> 00:22:13,280 Speaker 1: base effects, commodity prices. You also have some health pricing 428 00:22:13,359 --> 00:22:16,280 Speaker 1: issues that go into inflation and all those things. It 429 00:22:16,359 --> 00:22:18,600 Speaker 1: really is correct what the Pole is saying. It is 430 00:22:18,680 --> 00:22:21,800 Speaker 1: all temporary. And for the FT to think about inflation, 431 00:22:21,840 --> 00:22:24,679 Speaker 1: they always keep on emphasizing it has to be persistent. 432 00:22:25,040 --> 00:22:27,000 Speaker 1: It has to really be a situation where the whole 433 00:22:27,000 --> 00:22:30,080 Speaker 1: economy is boiling over where the overheating really is very 434 00:22:30,119 --> 00:22:33,639 Speaker 1: significant everywhere, and we're just nowhere near that point. At 435 00:22:33,680 --> 00:22:36,160 Speaker 1: this stage, it is clear that we will have strong growth, 436 00:22:36,320 --> 00:22:38,960 Speaker 1: So okay, we can start talking about that, but why 437 00:22:38,960 --> 00:22:41,600 Speaker 1: don't we create the tabulart jobs first that we have 438 00:22:41,720 --> 00:22:44,359 Speaker 1: behind red Tip Toper of two thousand twenty. Then we 439 00:22:44,359 --> 00:22:47,480 Speaker 1: can have a discussion about persistent inflation problems. And that's 440 00:22:47,520 --> 00:22:50,800 Speaker 1: definitely not this year towards. And there are a lot 441 00:22:50,800 --> 00:22:53,400 Speaker 1: of strong man arguments being made against the nineteen seventies 442 00:22:53,480 --> 00:22:56,320 Speaker 1: type of inflation and how we're not going to see that. 443 00:22:56,320 --> 00:22:58,320 Speaker 1: That seems likely that we're not going to go back 444 00:22:58,359 --> 00:23:01,520 Speaker 1: to that kind of rapid inflation nary environment. However, there 445 00:23:01,680 --> 00:23:04,399 Speaker 1: is this idea that not only have we printed all 446 00:23:04,400 --> 00:23:06,680 Speaker 1: this money that's about to be unleashed into the economy 447 00:23:06,720 --> 00:23:09,359 Speaker 1: when people can go out and spend more aggressively. But 448 00:23:09,400 --> 00:23:11,600 Speaker 1: there are also are these supply chain kinks. We have 449 00:23:11,720 --> 00:23:15,160 Speaker 1: people companies bringing supply chains back home. These are all 450 00:23:15,280 --> 00:23:18,560 Speaker 1: frictions as China gets less of a dominant place in 451 00:23:18,600 --> 00:23:22,600 Speaker 1: the global important export field, these are all frictions that 452 00:23:22,640 --> 00:23:26,159 Speaker 1: could add to inflation. How do you account for that? 453 00:23:25,960 --> 00:23:29,400 Speaker 1: That's absolutely correct. But if you think about transportation costs, 454 00:23:29,480 --> 00:23:32,280 Speaker 1: even if you think about commodity prices more generally, how 455 00:23:32,280 --> 00:23:36,080 Speaker 1: big a share is that of total costs for companies? 456 00:23:36,440 --> 00:23:38,639 Speaker 1: I mean, as a starting point, about two thirds of 457 00:23:38,680 --> 00:23:41,320 Speaker 1: cost for companies is labor. So that's the first a 458 00:23:41,359 --> 00:23:44,399 Speaker 1: discussion about if you really want an overheating economy, you 459 00:23:44,480 --> 00:23:47,640 Speaker 1: really need to see much more awkward pressure on wages, 460 00:23:48,040 --> 00:23:49,840 Speaker 1: and that you will not have that in a situation 461 00:23:49,880 --> 00:23:53,080 Speaker 1: where the labor market still is again about tenderland jobs behind. 462 00:23:53,440 --> 00:23:54,879 Speaker 1: Now you could say that if you look at the 463 00:23:54,960 --> 00:23:57,440 Speaker 1: n f I B, there are some signs that the 464 00:23:57,480 --> 00:24:00,560 Speaker 1: small businesses are saying that the biggest problem out is 465 00:24:00,600 --> 00:24:02,840 Speaker 1: that they can't find the right workers. They can't find 466 00:24:02,840 --> 00:24:05,040 Speaker 1: the right quality of labor. So there could be some 467 00:24:05,119 --> 00:24:07,720 Speaker 1: pieces of evidence that maybe in some corners of the 468 00:24:07,800 --> 00:24:09,840 Speaker 1: labor market you could have some weight to pressure. But 469 00:24:09,960 --> 00:24:13,360 Speaker 1: very broadly, speaking to your question, Leaser, it is true that, yes, 470 00:24:13,400 --> 00:24:15,960 Speaker 1: there are some problems in the supply chain, and there's 471 00:24:16,000 --> 00:24:18,840 Speaker 1: certainly some issues that could live things in, particularly because 472 00:24:18,840 --> 00:24:21,280 Speaker 1: of commodity prizes, But the biggest scheme of things you 473 00:24:21,400 --> 00:24:24,600 Speaker 1: think about the total cost base for corporate America, it 474 00:24:24,680 --> 00:24:28,560 Speaker 1: is still the case that commodity prizes and supply chain 475 00:24:28,640 --> 00:24:33,120 Speaker 1: issues are still a relatively modest amount of problems are 476 00:24:33,200 --> 00:24:35,439 Speaker 1: compared to at least some of the other things that 477 00:24:35,480 --> 00:24:37,480 Speaker 1: we need to see to have a nowhere here. So Toasting, 478 00:24:37,560 --> 00:24:39,920 Speaker 1: let's talk about labor. If this was two thousand and 479 00:24:40,040 --> 00:24:42,200 Speaker 1: nine and we were talking about ten million jobs short, 480 00:24:42,520 --> 00:24:44,080 Speaker 1: we have a problem, and we did have a problem, 481 00:24:44,080 --> 00:24:46,159 Speaker 1: and it took a long long time to recover from that. 482 00:24:46,640 --> 00:24:48,280 Speaker 1: But this is not two thousand and nine. This is 483 00:24:49,040 --> 00:24:52,400 Speaker 1: one and companies of shot because of policy by decision, 484 00:24:52,720 --> 00:24:54,480 Speaker 1: governments are telling them they've got to stay shut in 485 00:24:54,480 --> 00:24:56,879 Speaker 1: certain parts of the world, particularly at Sound of America 486 00:24:56,920 --> 00:24:59,320 Speaker 1: at the moment in Europe. So but that in mind, Toasting, 487 00:24:59,600 --> 00:25:01,840 Speaker 1: I just how relevant that ten million number is it's 488 00:25:01,840 --> 00:25:04,280 Speaker 1: certainly relevant if you are one of them. It's a struggle, 489 00:25:04,320 --> 00:25:06,160 Speaker 1: and we've talked about the pain in this labor market 490 00:25:06,240 --> 00:25:08,760 Speaker 1: right now. But where the optimistic tone and the hope 491 00:25:08,800 --> 00:25:10,720 Speaker 1: comes from is that as soon as you take these 492 00:25:10,760 --> 00:25:13,199 Speaker 1: restrictions off, a lot of that's gonna come back and 493 00:25:13,240 --> 00:25:15,399 Speaker 1: come back quickly. So when we wake up in a 494 00:25:15,440 --> 00:25:17,680 Speaker 1: summer toss and I want to understand from your perspective 495 00:25:17,680 --> 00:25:19,800 Speaker 1: exactly where we are in this cycle, because it's not 496 00:25:19,840 --> 00:25:21,200 Speaker 1: going to be the same as what we saw coming 497 00:25:21,200 --> 00:25:25,600 Speaker 1: out of OH nine. You're right, I mean, in some 498 00:25:25,680 --> 00:25:28,160 Speaker 1: sense say that the energy is that we turn off 499 00:25:28,160 --> 00:25:30,000 Speaker 1: the lights, and the question is can the lights just 500 00:25:30,080 --> 00:25:32,880 Speaker 1: to be turned on now? Can we just restart their 501 00:25:32,920 --> 00:25:35,600 Speaker 1: simply lines can get the smoke out of the chimneys 502 00:25:35,600 --> 00:25:38,240 Speaker 1: of the factories that have been on hold while we 503 00:25:38,280 --> 00:25:40,359 Speaker 1: have been in the pandemic. The issue here is, if 504 00:25:40,359 --> 00:25:42,560 Speaker 1: you think about this in practical terms, you need to 505 00:25:42,560 --> 00:25:45,480 Speaker 1: get airline capacity back to where it was before. You 506 00:25:45,480 --> 00:25:47,600 Speaker 1: need to get people to stay at hotels, used to 507 00:25:47,600 --> 00:25:49,679 Speaker 1: get people who go to restaurants. You need to get 508 00:25:49,720 --> 00:25:52,320 Speaker 1: people to go to sporting events, concerts, or their face 509 00:25:52,400 --> 00:25:56,160 Speaker 1: to face consumer services industries. It's a little bit difficult 510 00:25:56,200 --> 00:25:58,399 Speaker 1: to just see that as we're just turning off and 511 00:25:58,440 --> 00:26:00,920 Speaker 1: turning on the switch here again and say well, now 512 00:26:00,960 --> 00:26:02,760 Speaker 1: everyone just go out and do these things. I still 513 00:26:02,760 --> 00:26:05,240 Speaker 1: think it will take some time before those things get 514 00:26:05,240 --> 00:26:08,119 Speaker 1: back to the levels where we were in February of 515 00:26:08,119 --> 00:26:10,720 Speaker 1: two thousands twenty. But you're right, the upside risk could 516 00:26:10,760 --> 00:26:13,520 Speaker 1: being that employment comes back fast. But still ten million 517 00:26:13,600 --> 00:26:16,000 Speaker 1: is a pretty pretty big number when you think about 518 00:26:16,040 --> 00:26:17,720 Speaker 1: where we are today. So I think Jay Powell and 519 00:26:17,760 --> 00:26:20,000 Speaker 1: the message will get from him again today Je Paul 520 00:26:20,080 --> 00:26:22,600 Speaker 1: will say and continue to emphasize, yes, yes, it's true 521 00:26:22,960 --> 00:26:25,119 Speaker 1: that there are some very significant TiAl wins here. But 522 00:26:25,160 --> 00:26:27,200 Speaker 1: then why do we wait a little bit longer before 523 00:26:27,280 --> 00:26:29,800 Speaker 1: we take the champagne bottle out and celebrate and say 524 00:26:29,800 --> 00:26:31,919 Speaker 1: that now we have declared victory over I maybe it 525 00:26:31,960 --> 00:26:34,879 Speaker 1: is going to take quite some time still before we 526 00:26:34,960 --> 00:26:36,800 Speaker 1: get to the point of full employment. Or Jane Jillen 527 00:26:36,840 --> 00:26:39,360 Speaker 1: said yesterday, we'll probably have to get least into next 528 00:26:39,440 --> 00:26:43,359 Speaker 1: year before we get back to full employment in the economy. Again, 529 00:26:43,600 --> 00:26:45,440 Speaker 1: this phrase tost and let's just finish on this phrase 530 00:26:45,440 --> 00:26:48,199 Speaker 1: full employment. We hear it so much from economists, from you, 531 00:26:48,280 --> 00:26:50,199 Speaker 1: from others too. I talk about it as well. I 532 00:26:50,200 --> 00:26:51,800 Speaker 1: just don't know what it means anymore, torst them. What 533 00:26:51,840 --> 00:26:53,199 Speaker 1: does it mean for you? What are you looking for? 534 00:26:53,320 --> 00:26:55,800 Speaker 1: What's the data point that says, sure, we're that we've 535 00:26:55,840 --> 00:26:58,240 Speaker 1: made it? Yes, so that's right. So that's why I'm 536 00:26:58,320 --> 00:27:01,520 Speaker 1: watching the dots in the dot from the FAT podcast 537 00:27:01,560 --> 00:27:03,480 Speaker 1: that it be the summer if you can projections is 538 00:27:03,520 --> 00:27:05,640 Speaker 1: quite important, at least as a guide post for saying, hey, 539 00:27:06,080 --> 00:27:08,879 Speaker 1: maybe we had difficulties in markets quantifying this, but at 540 00:27:08,920 --> 00:27:11,600 Speaker 1: least what is the FATS saying is the unemployer rate 541 00:27:11,600 --> 00:27:13,720 Speaker 1: that we need to get down to, And they're saying 542 00:27:13,760 --> 00:27:15,359 Speaker 1: that they we need to get down to an employre 543 00:27:15,440 --> 00:27:17,840 Speaker 1: rate more close to around fall if we get a 544 00:27:17,880 --> 00:27:20,080 Speaker 1: fall handle, and then we may begin to see more 545 00:27:20,160 --> 00:27:23,000 Speaker 1: upper pressure on wages and therefore, in their view, also 546 00:27:23,119 --> 00:27:25,359 Speaker 1: more upper pressure on inflation. And given where we are 547 00:27:25,400 --> 00:27:28,000 Speaker 1: now with an employing rate today of more than six, 548 00:27:28,240 --> 00:27:30,920 Speaker 1: we still have quite a ways to go. But you're right, Jonathan, 549 00:27:30,920 --> 00:27:33,000 Speaker 1: it could also be that some parts of the label 550 00:27:33,040 --> 00:27:35,760 Speaker 1: market could be a bit stronger. But it is critical 551 00:27:35,800 --> 00:27:39,120 Speaker 1: this question of how far we are away from full employment. 552 00:27:39,119 --> 00:27:41,520 Speaker 1: But it's pretty clear that and this is again what 553 00:27:41,600 --> 00:27:43,679 Speaker 1: Yellen was saying yesterday, then we're probably not going to 554 00:27:43,760 --> 00:27:46,000 Speaker 1: get to full employment in two thousand twenty one. They 555 00:27:46,040 --> 00:27:48,440 Speaker 1: toast and gonna catch out, Gonna see you. Important conversation, 556 00:27:48,480 --> 00:27:51,080 Speaker 1: No doubt, we'll have another one very soon, Toasting Slot 557 00:27:51,119 --> 00:28:02,359 Speaker 1: Apollo Global Management, Chief Economists A teen museums successful because 558 00:28:02,400 --> 00:28:07,280 Speaker 1: I was a kid three afternoons at a five after school. 559 00:28:07,760 --> 00:28:10,359 Speaker 1: If I wasn't doing something else, I was in a 560 00:28:10,480 --> 00:28:13,919 Speaker 1: museum looking at things, and I love museums, and I 561 00:28:13,920 --> 00:28:18,600 Speaker 1: wanted to make it a greatly greater and greater. That 562 00:28:18,760 --> 00:28:21,399 Speaker 1: was Leonard A. Lauder. He is est A Lauder Chairman 563 00:28:21,480 --> 00:28:25,280 Speaker 1: emeritus as well as the former chief executive officer and 564 00:28:25,359 --> 00:28:28,639 Speaker 1: also the son of a number of the two people 565 00:28:28,680 --> 00:28:33,960 Speaker 1: who founded this company, David Rubinstein Uh. He interviewed him 566 00:28:34,000 --> 00:28:36,160 Speaker 1: on a Peer to Peer Conversations that set to air 567 00:28:36,840 --> 00:28:39,680 Speaker 1: in the upcoming days. David Rubinstein joining us now the 568 00:28:39,680 --> 00:28:42,600 Speaker 1: host of Peer to Peer Conversations as well as uh 569 00:28:42,720 --> 00:28:47,480 Speaker 1: the founder of Carlisle Group joining us here, David Fantastic 570 00:28:47,600 --> 00:28:50,640 Speaker 1: Rags to Riches Story, one of the most storied makeup 571 00:28:50,680 --> 00:28:53,840 Speaker 1: companies in the United states Esta Lauder. What was the 572 00:28:53,880 --> 00:28:58,760 Speaker 1: biggest standout message from this interview. Well, the company started 573 00:28:58,840 --> 00:29:01,520 Speaker 1: very modestly. We now know it as a spectacular company. 574 00:29:01,520 --> 00:29:04,640 Speaker 1: And Leonard Louder often has said, well, you join your 575 00:29:04,640 --> 00:29:07,920 Speaker 1: mother's big company, Esta Lauder. But actually when he joined 576 00:29:07,920 --> 00:29:10,200 Speaker 1: it was at eight hundred thousand of revenue, so it 577 00:29:10,280 --> 00:29:12,840 Speaker 1: was a modest company, and he really helped build it. 578 00:29:13,040 --> 00:29:15,600 Speaker 1: He made his mother into the face of the company. 579 00:29:15,800 --> 00:29:18,760 Speaker 1: She wasn't the business person per se. That was Leonard 580 00:29:18,960 --> 00:29:21,240 Speaker 1: and he really did an incredible job of building into 581 00:29:21,280 --> 00:29:25,240 Speaker 1: one of the most successful companies in the country. I 582 00:29:25,280 --> 00:29:28,400 Speaker 1: when you talk about the modest inception of this company 583 00:29:28,440 --> 00:29:31,440 Speaker 1: to where it is now, you asked him about a 584 00:29:31,480 --> 00:29:33,720 Speaker 1: modern entrepreneur trying to get into the game in the 585 00:29:33,760 --> 00:29:36,240 Speaker 1: same kind of way and launching a brand. What was 586 00:29:36,320 --> 00:29:39,120 Speaker 1: his insight and how things have changed now versus then. 587 00:29:39,920 --> 00:29:43,280 Speaker 1: It's more competition harder in those days. Uh, it was 588 00:29:43,360 --> 00:29:46,080 Speaker 1: easier to kind of sneak up on competition. But he 589 00:29:46,120 --> 00:29:49,640 Speaker 1: had a big competitor named Charles Revson who built Revlon 590 00:29:50,040 --> 00:29:52,640 Speaker 1: and Revlon was the eight hundred pound gerrilla then and 591 00:29:52,680 --> 00:29:55,600 Speaker 1: Revlon once tried to buy Esta Lauder for a million 592 00:29:55,640 --> 00:29:58,840 Speaker 1: dollars um and his mother ultimately decided not to do it. 593 00:29:59,240 --> 00:30:00,880 Speaker 1: Had they done so, we wouldn't have heard of est 594 00:30:01,040 --> 00:30:04,840 Speaker 1: Lauder probably, But it shows you can overcome gigantic UH 595 00:30:04,840 --> 00:30:07,840 Speaker 1: competitors if you're really persistent and really smart and and 596 00:30:08,320 --> 00:30:11,760 Speaker 1: Leonard was. Leonard really was the genius behind this branding 597 00:30:11,800 --> 00:30:14,200 Speaker 1: of a company, and the business of the company's mother 598 00:30:14,240 --> 00:30:17,800 Speaker 1: was a terrific symbol though, of a company. I feel 599 00:30:17,800 --> 00:30:19,920 Speaker 1: like we can't talk to corporate leaders right now without 600 00:30:20,000 --> 00:30:22,560 Speaker 1: talking about the pandemic and how it's affected their business 601 00:30:22,880 --> 00:30:25,600 Speaker 1: and the way they operate in offices and beyond. How 602 00:30:25,680 --> 00:30:27,880 Speaker 1: has the idea that people are working from home and 603 00:30:27,920 --> 00:30:32,320 Speaker 1: aren't socializing as much affected the landscape for a makeup company. 604 00:30:32,400 --> 00:30:34,200 Speaker 1: That has to do with perception. I mean, has it 605 00:30:34,240 --> 00:30:36,920 Speaker 1: been enhanced through the ideas of Instagram or has it 606 00:30:36,960 --> 00:30:39,920 Speaker 1: been taken away from just because people are not going 607 00:30:39,960 --> 00:30:42,800 Speaker 1: out and being with their friends as much. Well, I 608 00:30:42,840 --> 00:30:45,280 Speaker 1: think people are putting makeup on when I go do 609 00:30:45,440 --> 00:30:47,400 Speaker 1: their zoom calls and other things, so I don't think 610 00:30:47,400 --> 00:30:51,240 Speaker 1: it's adversely affected UH the industry completely, but but surely 611 00:30:51,240 --> 00:30:53,680 Speaker 1: when people are not doing as much socializing as before, 612 00:30:54,280 --> 00:30:56,600 Speaker 1: It's probably not as as favorable, but I do think 613 00:30:56,640 --> 00:30:59,960 Speaker 1: the company has incredible brand and it now has something 614 00:31:00,080 --> 00:31:02,480 Speaker 1: like twenty eight different brands. It just Estate Lauder is 615 00:31:02,520 --> 00:31:04,479 Speaker 1: the main brand, the name of the company, but they 616 00:31:04,480 --> 00:31:06,680 Speaker 1: have bought many other brands over the years and built 617 00:31:06,720 --> 00:31:11,600 Speaker 1: some like Finigue, for example. So since you yourself are 618 00:31:11,680 --> 00:31:14,280 Speaker 1: co chair and co founder of Carlisle Group, I do 619 00:31:14,360 --> 00:31:17,400 Speaker 1: want to ask you about the pandemic and how it's 620 00:31:17,400 --> 00:31:19,920 Speaker 1: affected some of the morale. We've heard from city groups 621 00:31:20,560 --> 00:31:23,560 Speaker 1: Jane Fraser about how they plan to boost morale for 622 00:31:23,640 --> 00:31:26,600 Speaker 1: companies that have Zoom, for individuals that have Zoom burnout, 623 00:31:26,840 --> 00:31:29,640 Speaker 1: and we are from another group of Wall Street firms 624 00:31:29,680 --> 00:31:32,160 Speaker 1: that they're they're come there there. Their employees are struggling 625 00:31:32,200 --> 00:31:35,640 Speaker 1: at home after working with kids, after having a very 626 00:31:35,640 --> 00:31:39,200 Speaker 1: little break between home and work. What's your response to 627 00:31:39,240 --> 00:31:41,680 Speaker 1: that and how much have you observed this zoom fatigue 628 00:31:41,920 --> 00:31:46,360 Speaker 1: among your employees. I think zoom fatigue is everywhere. It's 629 00:31:46,360 --> 00:31:49,240 Speaker 1: been over a year now and I've been living essentially 630 00:31:49,240 --> 00:31:51,680 Speaker 1: in this house for about a year, house that I've 631 00:31:51,680 --> 00:31:53,520 Speaker 1: lived in for thirty some years, but I hadn't really 632 00:31:53,520 --> 00:31:56,000 Speaker 1: spent much time and it compared to the last year. 633 00:31:56,640 --> 00:31:59,320 Speaker 1: But I do think that ultimately the businesses that are 634 00:31:59,520 --> 00:32:02,360 Speaker 1: right of distuildings will go back. I doubt though, that 635 00:32:02,400 --> 00:32:04,920 Speaker 1: people will go back and work five days a week, 636 00:32:05,120 --> 00:32:06,760 Speaker 1: you know, ten hours a day in their office. I 637 00:32:06,760 --> 00:32:10,720 Speaker 1: think people will increasingly want to spend some time working remotely, 638 00:32:10,960 --> 00:32:13,120 Speaker 1: and I think that's not a bad idea. Like I 639 00:32:13,160 --> 00:32:15,000 Speaker 1: do believe that people would like to get back to 640 00:32:15,080 --> 00:32:17,760 Speaker 1: work when they believe it's safe and they have to 641 00:32:17,760 --> 00:32:19,600 Speaker 1: make certain that there's not going to be any chance 642 00:32:19,640 --> 00:32:21,440 Speaker 1: of catching a virus. But I think it's going to 643 00:32:21,520 --> 00:32:26,440 Speaker 1: take another six before that happens. Have you observed, though, 644 00:32:26,480 --> 00:32:30,040 Speaker 1: that that productivity is starting to decrease around the edges 645 00:32:30,080 --> 00:32:34,400 Speaker 1: among employees who are struggling with this work home balance 646 00:32:34,520 --> 00:32:38,239 Speaker 1: that has gotten up ended by the pandemic. Well, in 647 00:32:38,280 --> 00:32:41,200 Speaker 1: the private equity world, it's hard to say that because 648 00:32:41,240 --> 00:32:44,160 Speaker 1: of the private equity world has adopted to zoom quite well, 649 00:32:44,640 --> 00:32:47,640 Speaker 1: and we've been doing deals, raising money and exiting deals 650 00:32:47,640 --> 00:32:49,720 Speaker 1: at a quite good pace, so I can't say that 651 00:32:49,800 --> 00:32:52,640 Speaker 1: productivity has gone down. I do think everybody would like 652 00:32:52,680 --> 00:32:54,080 Speaker 1: to get back to is what has used to be 653 00:32:54,120 --> 00:32:56,400 Speaker 1: considered normal. But I do think that normal in the 654 00:32:56,400 --> 00:32:59,160 Speaker 1: future will consider it will be considered to have have 655 00:32:59,320 --> 00:33:02,280 Speaker 1: some work unremotely. I don't think people will travel as 656 00:33:02,360 --> 00:33:04,600 Speaker 1: much as they used to. Um I used to fly 657 00:33:04,720 --> 00:33:06,600 Speaker 1: halfway around the world for an hour meeting, and I 658 00:33:06,600 --> 00:33:08,760 Speaker 1: don't think that people like me will do that again. 659 00:33:10,200 --> 00:33:12,479 Speaker 1: That's actually been a debate that we've been harping on 660 00:33:12,480 --> 00:33:15,280 Speaker 1: this morning, the idea of business travel returning and how much. 661 00:33:15,600 --> 00:33:18,000 Speaker 1: And my colleague John Farrow made a really good point 662 00:33:18,120 --> 00:33:20,200 Speaker 1: that if if I can bring you a bottle of 663 00:33:20,200 --> 00:33:22,040 Speaker 1: wine and see you face to face, I'm more likely 664 00:33:22,040 --> 00:33:25,120 Speaker 1: to win the deal versus not. So business travel will return. 665 00:33:25,560 --> 00:33:28,120 Speaker 1: Where will it return and where won't it return? From 666 00:33:28,120 --> 00:33:32,760 Speaker 1: your perspective in your world, David, I think travel that 667 00:33:32,960 --> 00:33:35,720 Speaker 1: is global, where you have to travel halfway around the 668 00:33:35,720 --> 00:33:39,040 Speaker 1: world for a meeting, that will be slow to come back. 669 00:33:39,320 --> 00:33:41,400 Speaker 1: But if it's going from Washington, New York, or New 670 00:33:41,440 --> 00:33:44,480 Speaker 1: York to Boston or Philadelphia, New York, that's relatively easier 671 00:33:44,520 --> 00:33:47,640 Speaker 1: to do. So I think shorter distances will probably still 672 00:33:47,640 --> 00:33:49,560 Speaker 1: see a lot of meetings, But if you have to 673 00:33:49,600 --> 00:33:52,800 Speaker 1: travel an enormous long time to get somewhere, that will 674 00:33:52,800 --> 00:33:54,280 Speaker 1: be harder to get done. I do think that will 675 00:33:54,320 --> 00:33:56,920 Speaker 1: be some of that, for sure, some businesses require you 676 00:33:56,960 --> 00:33:58,600 Speaker 1: to do that, but I do think it will come 677 00:33:58,600 --> 00:34:02,480 Speaker 1: back more slowly than than we would like. Just going 678 00:34:02,520 --> 00:34:04,960 Speaker 1: forward right now at the theme of the morning has 679 00:34:05,000 --> 00:34:08,200 Speaker 1: been peak optimism, peak reopening, and we have felt that 680 00:34:08,280 --> 00:34:11,040 Speaker 1: a lot of the forward action of the earnings that 681 00:34:11,080 --> 00:34:13,080 Speaker 1: we are going to see has already been priced into 682 00:34:13,120 --> 00:34:16,000 Speaker 1: the markets. From your vantage point, as far as deals 683 00:34:16,000 --> 00:34:18,799 Speaker 1: getting done, do you see things starting to slow as 684 00:34:18,840 --> 00:34:21,200 Speaker 1: people believe that the window is kind of up for 685 00:34:21,239 --> 00:34:24,200 Speaker 1: sort of peak perfection in markets as the economy now 686 00:34:24,239 --> 00:34:27,080 Speaker 1: has to catch up. Well. Predicting what's going to happen 687 00:34:27,120 --> 00:34:30,080 Speaker 1: in the market's always a dangerous kind of uh undertaking. 688 00:34:30,120 --> 00:34:32,479 Speaker 1: But I do think that as long as interest rates 689 00:34:32,480 --> 00:34:34,960 Speaker 1: stay low, I do think that you'll see a fair 690 00:34:34,960 --> 00:34:36,719 Speaker 1: amount of deal is getting done. And I don't think 691 00:34:36,719 --> 00:34:39,279 Speaker 1: I've see a real slowdown. I do think that the 692 00:34:39,400 --> 00:34:42,719 Speaker 1: spack market probably has slowed down a little bit of late. 693 00:34:42,800 --> 00:34:44,920 Speaker 1: I mean, it has been very robust. It couldn't keep 694 00:34:44,960 --> 00:34:46,960 Speaker 1: going on at that pace forever, and I do think 695 00:34:47,320 --> 00:34:50,080 Speaker 1: some spack prices have come down, But generally, I think 696 00:34:50,080 --> 00:34:51,960 Speaker 1: SPACs are probably here to stay for a while. At 697 00:34:52,000 --> 00:34:54,960 Speaker 1: least at some level. I do think that the financing 698 00:34:55,000 --> 00:34:57,680 Speaker 1: markets are still relatively robust and and I don't think 699 00:34:57,680 --> 00:34:59,799 Speaker 1: a slowdown is imminent, in large part because the one 700 00:35:00,120 --> 00:35:02,880 Speaker 1: nine trillion dollar stimules Phil is going to keep the 701 00:35:02,920 --> 00:35:05,799 Speaker 1: economy in reasonable shape for a while. David Rubinstein, thank 702 00:35:05,840 --> 00:35:08,640 Speaker 1: you so much for being with us, and the interview 703 00:35:08,760 --> 00:35:11,520 Speaker 1: is phenomenal. I recommend that everybody watch it. That was 704 00:35:11,600 --> 00:35:15,160 Speaker 1: David Rubinstein, coach, hair and co founder of the Carlisle Group, 705 00:35:15,160 --> 00:35:17,600 Speaker 1: as well as the host of peer to peer conversations. 706 00:35:18,120 --> 00:35:21,879 Speaker 1: This is the Bloomberg Surveillance Podcast. Thanks for listening. Join 707 00:35:22,000 --> 00:35:25,320 Speaker 1: us live weekdays from seven to ten am Eastern on 708 00:35:25,440 --> 00:35:29,680 Speaker 1: Bloomberg Radio and on Bloomberg Television each day from six 709 00:35:29,800 --> 00:35:34,600 Speaker 1: to nine am for insight from the best in economics, finance, investment, 710 00:35:34,800 --> 00:35:41,520 Speaker 1: and international relations. And subscribe to the Surveillance podcast on Apple, podcast, SoundCloud, 711 00:35:41,680 --> 00:35:45,279 Speaker 1: Bloomberg dot com, and of course on the terminal. I'm 712 00:35:45,320 --> 00:35:47,960 Speaker 1: Tom Keene and this is Bloomberg