WEBVTT - Single Best Idea with Tom Keene: Campbell Harvey & Ed Morse

0:00:02.520 --> 0:00:15.920
<v Speaker 1>Bloomberg Audio Studios, podcasts, radio news, single best idea and

0:00:16.000 --> 0:00:17.800
<v Speaker 1>to go back to the heart and soul of what

0:00:17.840 --> 0:00:22.720
<v Speaker 1>we've done for over two decades. It's really important in

0:00:22.760 --> 0:00:27.680
<v Speaker 1>the racket to keep track of how and where people

0:00:27.800 --> 0:00:32.720
<v Speaker 1>came from. Kimbl Harvey is at Duke University. He's really exquisite.

0:00:33.320 --> 0:00:36.519
<v Speaker 1>His lead academics years ago out of the Canadian schools,

0:00:36.560 --> 0:00:42.160
<v Speaker 1>the University of York and others, was on consumer preference,

0:00:43.080 --> 0:00:47.479
<v Speaker 1>what consumers do and how they act, but far more important,

0:00:47.479 --> 0:00:49.839
<v Speaker 1>and he's too modest of a guy to ever mention it.

0:00:50.600 --> 0:00:54.360
<v Speaker 1>What do you do in your doctoral dissertation when three

0:00:54.440 --> 0:00:58.720
<v Speaker 1>of the five professors six professors, when three of them

0:00:59.240 --> 0:01:02.920
<v Speaker 1>our future Nobel Prize winners. I don't know how many

0:01:03.000 --> 0:01:06.400
<v Speaker 1>people within the Bloomberg surveillance world can say that. To

0:01:06.440 --> 0:01:12.280
<v Speaker 1>survive a doctoral dissertation with Fama, Merton, and Hanson at

0:01:12.440 --> 0:01:18.560
<v Speaker 1>Chicago is just absolutely definitive. Campbell Harvey on the American consumer.

0:01:18.840 --> 0:01:22.560
<v Speaker 2>Most of our models and economics have what's called a

0:01:22.640 --> 0:01:28.200
<v Speaker 2>representative consumer, which is code for everybody's the same, and

0:01:28.600 --> 0:01:33.120
<v Speaker 2>that's just not the case anymore. So we're a very

0:01:33.240 --> 0:01:39.520
<v Speaker 2>heterogeneous and I've argued that that part of kind of

0:01:39.560 --> 0:01:44.560
<v Speaker 2>the decreasing volatility of the business cycles. So our business

0:01:44.560 --> 0:01:49.560
<v Speaker 2>cycles are way milder than in the past, even considering

0:01:49.720 --> 0:01:53.960
<v Speaker 2>the global financial crisis and COVID, So they're less frequent

0:01:54.120 --> 0:01:58.920
<v Speaker 2>and they're milder. And this is because there are a

0:01:58.960 --> 0:02:02.640
<v Speaker 2>couple of classes consumers at least, and there's one class

0:02:03.040 --> 0:02:06.360
<v Speaker 2>that is very well off and they just don't respond.

0:02:07.000 --> 0:02:09.320
<v Speaker 2>So inflation goes up with no big deal to them.

0:02:09.520 --> 0:02:13.560
<v Speaker 1>They just buy Kim Harvey. And that definitive argument there

0:02:13.560 --> 0:02:16.519
<v Speaker 1>between Campbell Harvey of Duke University and the late Saint

0:02:16.560 --> 0:02:21.400
<v Speaker 1>Alan Meltzer Carnegie Mellon is extraordinary. Should we aggregate our

0:02:21.520 --> 0:02:27.240
<v Speaker 1>data or his America becomes so unique under consumption, even investment,

0:02:27.800 --> 0:02:31.080
<v Speaker 1>even government, and of course our export dynamics with all

0:02:31.120 --> 0:02:35.040
<v Speaker 1>the tariffs that are going on. Have we become two America?

0:02:35.120 --> 0:02:38.640
<v Speaker 1>Is just a wonderful moment there with the professor of

0:02:38.720 --> 0:02:42.919
<v Speaker 1>Duke University. What an honor today, given all that's going on,

0:02:43.000 --> 0:02:46.359
<v Speaker 1>to speak to Edward Morse in his eighties. He's got

0:02:46.400 --> 0:02:50.000
<v Speaker 1>the interior energy of a thirty five year old, absolutely

0:02:50.200 --> 0:02:55.320
<v Speaker 1>unreal conversation with Edward Morris iconic at City Group all

0:02:55.360 --> 0:02:59.320
<v Speaker 1>of his academics, including back to Princeton fifty years ago,

0:02:59.800 --> 0:03:03.600
<v Speaker 1>was on fire today and in some support of Trump

0:03:03.880 --> 0:03:08.800
<v Speaker 1>energy policy. Here is Edward Morris of Hartree on John Carrey.

0:03:08.919 --> 0:03:11.959
<v Speaker 3>I'm critical of one thing that I think looms very large,

0:03:12.320 --> 0:03:16.040
<v Speaker 3>and John Carey's name is associated with it. When we

0:03:16.160 --> 0:03:19.680
<v Speaker 3>had the push for a clean energy world and the

0:03:19.760 --> 0:03:22.919
<v Speaker 3>US was in a leadership position on it, we also

0:03:23.000 --> 0:03:26.160
<v Speaker 3>had the view official view that we not only want

0:03:26.160 --> 0:03:29.680
<v Speaker 3>to get rid of oil and the emissions from burning

0:03:29.720 --> 0:03:32.040
<v Speaker 3>oil as a transport fuel, but we have the view

0:03:32.080 --> 0:03:35.520
<v Speaker 3>that we should get rid of natural gas as a

0:03:35.560 --> 0:03:41.440
<v Speaker 3>fossil fuel, and that really set us back because fossil fuels,

0:03:41.480 --> 0:03:45.440
<v Speaker 3>we can't get to net zero without actually using a

0:03:45.480 --> 0:03:47.960
<v Speaker 3>lot of natural gas. We have to use it carefully,

0:03:48.040 --> 0:03:50.920
<v Speaker 3>we have to make sure that methane emissions are controlled.

0:03:51.720 --> 0:03:55.520
<v Speaker 3>But not allowing pipelines to be built for natural gas,

0:03:55.840 --> 0:04:02.680
<v Speaker 3>not pushing for natural gas in the overall displacement of

0:04:02.760 --> 0:04:07.240
<v Speaker 3>oil and discouraging oil's use was a mistake in my

0:04:07.400 --> 0:04:09.640
<v Speaker 3>mind and set us back on the road to a

0:04:09.680 --> 0:04:12.600
<v Speaker 3>cleaner world. And when we come to natural gas, by

0:04:12.640 --> 0:04:16.359
<v Speaker 3>the way, the US is the largest producer in the

0:04:16.360 --> 0:04:19.960
<v Speaker 3>world we have the largest exporter in the world, both

0:04:20.000 --> 0:04:23.640
<v Speaker 3>of oil and natural gas, and if you look at

0:04:23.680 --> 0:04:26.640
<v Speaker 3>the next five years, the US is going to keep

0:04:26.640 --> 0:04:28.960
<v Speaker 3>that up and remain the largest exporter with the largest

0:04:29.000 --> 0:04:33.640
<v Speaker 3>growth fifty percent of the growth of gas utilization and production,

0:04:33.760 --> 0:04:35.800
<v Speaker 3>but we're going to be exporting most of it is

0:04:35.839 --> 0:04:38.760
<v Speaker 3>coming from the US. It's a very important tool for

0:04:38.839 --> 0:04:40.640
<v Speaker 3>economics and for the energy transition.

0:04:41.040 --> 0:04:44.800
<v Speaker 1>Edward Morse of heartree with US today. An eventful week

0:04:44.800 --> 0:04:48.400
<v Speaker 1>with a FED meeting on Wednesday. Of course, on podcasts

0:04:48.440 --> 0:04:55.039
<v Speaker 1>out of Apple podcasts, Spotify, huge worldwide response to Spotify podcast.

0:04:55.160 --> 0:04:58.680
<v Speaker 1>Thank you for that, and we are at YouTube podcasts.

0:04:58.880 --> 0:05:00.400
<v Speaker 1>This is a single best I get

0:05:14.800 --> 0:05:14.840
<v Speaker 3>H