1 00:00:02,640 --> 00:00:05,320 Speaker 1: Welcome to the Bloomberg PENL podcast. I'm Paul swing you 2 00:00:05,360 --> 00:00:07,680 Speaker 1: along with my co host Lisa Brahma Wicks. Each day 3 00:00:07,720 --> 00:00:10,240 Speaker 1: we bring you the most noteworthy and useful interviews for 4 00:00:10,280 --> 00:00:12,520 Speaker 1: you and your money. Whether at the grocery store or 5 00:00:12,560 --> 00:00:15,480 Speaker 1: the trading floor. Find a Bloomberg Penl podcast on Apple 6 00:00:15,520 --> 00:00:17,959 Speaker 1: podcast or wherever you listen to podcasts, as well as 7 00:00:17,960 --> 00:00:21,120 Speaker 1: at Bloomberg dot com. I'm looking at my commodity screen 8 00:00:21,120 --> 00:00:23,040 Speaker 1: on my Bloomberg terminal. That would be g L CEO 9 00:00:23,160 --> 00:00:25,400 Speaker 1: for your terminal users out there. I see a lot 10 00:00:25,520 --> 00:00:28,800 Speaker 1: of red across the screen. Concerns about global growth stock 11 00:00:28,840 --> 00:00:31,680 Speaker 1: by the coronavirus, certainly, but the couple of areas that 12 00:00:31,720 --> 00:00:34,080 Speaker 1: really stand out on the positive side would be spot 13 00:00:34,120 --> 00:00:36,960 Speaker 1: gold up ten point four percent year today. To get 14 00:00:37,000 --> 00:00:38,400 Speaker 1: a sense of what's going on in the world of 15 00:00:38,600 --> 00:00:41,720 Speaker 1: precious and base metals, we welcome Everett Millman, precious metal 16 00:00:41,800 --> 00:00:44,720 Speaker 1: specialist at Gainesville Coins based in gains Will, Florida, but 17 00:00:44,800 --> 00:00:47,600 Speaker 1: joining us here in our Bloomberg Interactive Broker studio. Everett, 18 00:00:47,600 --> 00:00:49,800 Speaker 1: thanks so much for joining us here in our studio. 19 00:00:50,159 --> 00:00:52,720 Speaker 1: Let's start with gold, and we're just talking about before 20 00:00:52,760 --> 00:00:54,920 Speaker 1: going on air, and Lisa was pointing out the nice 21 00:00:55,040 --> 00:00:58,080 Speaker 1: run gold has had. What's kind of your sense for 22 00:00:58,160 --> 00:01:00,840 Speaker 1: what's really driving it and kind of where can this 23 00:01:00,880 --> 00:01:05,119 Speaker 1: thing go? Thanks Paul. Obviously the coronavirus is having a 24 00:01:05,160 --> 00:01:08,520 Speaker 1: major effect. You can't deny that the damage to global 25 00:01:08,560 --> 00:01:12,319 Speaker 1: supply chains is layering on top of what was already 26 00:01:12,319 --> 00:01:15,720 Speaker 1: a slowing global economy. People are fearful, and gold is 27 00:01:15,800 --> 00:01:19,119 Speaker 1: definitely absorbing that safe haven flight. We're seeing a lot 28 00:01:19,120 --> 00:01:22,120 Speaker 1: of flight to quality and that means gold treasuries and 29 00:01:22,160 --> 00:01:24,600 Speaker 1: the US dollar. But we still haven't had a lot 30 00:01:24,640 --> 00:01:27,080 Speaker 1: of resolution in the trade war. I think that what's 31 00:01:27,120 --> 00:01:30,479 Speaker 1: interesting about the impact of the coronavirus is that it's 32 00:01:30,600 --> 00:01:34,400 Speaker 1: causing some pullback on the agreement, the Phase one agreement 33 00:01:34,480 --> 00:01:37,360 Speaker 1: that China and the US came to. That China, because 34 00:01:37,360 --> 00:01:39,960 Speaker 1: their economy is at a standstill, they really can't meet 35 00:01:40,040 --> 00:01:42,960 Speaker 1: any of the UH stipulations that they agreed to. They're 36 00:01:42,959 --> 00:01:45,480 Speaker 1: not going to be able to increase their agricultural purchases, 37 00:01:45,520 --> 00:01:48,960 Speaker 1: They're not going to be able to um be that 38 00:01:49,160 --> 00:01:51,640 Speaker 1: bedrock for the global economy right now. So I think 39 00:01:51,640 --> 00:01:54,520 Speaker 1: that gold is the obvious place for investors to go 40 00:01:54,640 --> 00:01:57,680 Speaker 1: when there is so much uncertainty still around this trade 41 00:01:57,720 --> 00:02:00,000 Speaker 1: dispute that has gone on for many, many months before 42 00:02:00,120 --> 00:02:03,040 Speaker 1: or the coronavirus even broke out. So let's dig a 43 00:02:03,080 --> 00:02:05,720 Speaker 1: little bit deeper into some of the technicals here, because, 44 00:02:05,720 --> 00:02:08,520 Speaker 1: as you mentioned, uncertainty really is the prevailing word of 45 00:02:08,520 --> 00:02:10,360 Speaker 1: the day. And I think, Paul, it's really interesting to 46 00:02:10,360 --> 00:02:12,920 Speaker 1: see the size and scope for so many markets today 47 00:02:13,040 --> 00:02:16,560 Speaker 1: is two thousand sixteen, right as Brexit was really front 48 00:02:16,560 --> 00:02:18,799 Speaker 1: and center and kind of driving a lot of market action, 49 00:02:19,080 --> 00:02:23,359 Speaker 1: another time of significant uncertainty. If you strip that away, 50 00:02:23,440 --> 00:02:26,600 Speaker 1: and today's moves which are perhaps going to be portrayed 51 00:02:26,639 --> 00:02:31,040 Speaker 1: as knee jerk removes moves, in hindsight, we shall see 52 00:02:31,840 --> 00:02:35,160 Speaker 1: what is the momentum in general for gold, you know, 53 00:02:35,280 --> 00:02:39,040 Speaker 1: just generally, given where we're at economically, given the fact 54 00:02:39,120 --> 00:02:41,720 Speaker 1: that all things being equal to US and China have 55 00:02:41,760 --> 00:02:44,200 Speaker 1: come to some sort of trade trus right, And I 56 00:02:44,240 --> 00:02:48,120 Speaker 1: think that that positive momentum is undeniable, So it's still 57 00:02:48,160 --> 00:02:51,280 Speaker 1: there even without this knee jerk reaction. Correct, And I 58 00:02:51,320 --> 00:02:54,600 Speaker 1: think that there was a similar sort of dynamic during 59 00:02:54,639 --> 00:02:58,919 Speaker 1: the Iran crisis that gold jumped right after the news 60 00:02:59,160 --> 00:03:02,040 Speaker 1: and everyone expected to see a sell off following that, 61 00:03:02,080 --> 00:03:04,000 Speaker 1: and we really didn't get it. We have climbed higher 62 00:03:04,320 --> 00:03:07,320 Speaker 1: from that fifteen hundred dollar range since then. Um From 63 00:03:07,320 --> 00:03:10,960 Speaker 1: a technical perspective, gold certainly appears to be overbought right now. 64 00:03:11,480 --> 00:03:13,959 Speaker 1: The r s I is very high. It's well above 65 00:03:14,040 --> 00:03:16,480 Speaker 1: it's fifty day moving average and it's two in day 66 00:03:16,480 --> 00:03:19,600 Speaker 1: moving average, so I think we could see some profit taking, 67 00:03:20,240 --> 00:03:23,280 Speaker 1: but the general narrative is still certainly in place that 68 00:03:23,360 --> 00:03:25,680 Speaker 1: gold looks like it could test as high as seventeen 69 00:03:25,720 --> 00:03:28,359 Speaker 1: fifty in the coming months, and the I guess the 70 00:03:28,400 --> 00:03:31,679 Speaker 1: all time high back in was seventeen seventy, so we're 71 00:03:31,840 --> 00:03:34,400 Speaker 1: pretty close to that. I mean, I'm also looking at 72 00:03:34,600 --> 00:03:37,920 Speaker 1: silver again, Gold up about ten percent year to date, 73 00:03:37,960 --> 00:03:41,480 Speaker 1: silver only up about five percent. Is that under performance 74 00:03:41,520 --> 00:03:43,200 Speaker 1: for silver? Is that? Should I take note of that 75 00:03:43,240 --> 00:03:45,880 Speaker 1: at all? Sure? I mean, here's you four. Silver has 76 00:03:45,880 --> 00:03:48,640 Speaker 1: been lagging gold, partly because it relies so much on 77 00:03:48,680 --> 00:03:52,040 Speaker 1: industrial demand. So everything with the coronavirus and the slowing 78 00:03:52,040 --> 00:03:55,200 Speaker 1: of the Chinese economy has dragged silver lower. It's been 79 00:03:55,280 --> 00:03:57,560 Speaker 1: much more sensitive to what's been going on with the 80 00:03:57,560 --> 00:04:00,720 Speaker 1: base metals like copper, but it did take out it's 81 00:04:00,760 --> 00:04:03,880 Speaker 1: September high from last year. It's well above eighteen fifty, 82 00:04:03,960 --> 00:04:07,480 Speaker 1: and I think that allows for some positive momentum for 83 00:04:07,520 --> 00:04:10,040 Speaker 1: silver to play catch up with gold, because the gold 84 00:04:10,040 --> 00:04:12,880 Speaker 1: of silver ratio is still extremely elevated, and I would 85 00:04:12,880 --> 00:04:16,120 Speaker 1: expect to see that correct, especially if there continues to 86 00:04:16,160 --> 00:04:18,600 Speaker 1: be safehaven flight into the medals generally. All right, So 87 00:04:18,640 --> 00:04:21,200 Speaker 1: you mentioned copper and dr Copper usually has thought of 88 00:04:21,240 --> 00:04:24,680 Speaker 1: as an economic gauge where it goes so to goes 89 00:04:24,800 --> 00:04:27,719 Speaker 1: the economy. Interesting to see that it's not lower today, 90 00:04:27,839 --> 00:04:30,599 Speaker 1: or it's not declining more in this knee jerk risk 91 00:04:30,680 --> 00:04:33,680 Speaker 1: off move. You can see, Uh, it's declining one point 92 00:04:33,680 --> 00:04:37,280 Speaker 1: three percent materially behind oil, which is falling out of bed. 93 00:04:37,680 --> 00:04:41,279 Speaker 1: Why the resilience. That's a bit surprising. I would expect 94 00:04:41,320 --> 00:04:44,880 Speaker 1: copper to respond similarly to oil, and we've seen this 95 00:04:45,120 --> 00:04:49,039 Speaker 1: widening gold to copper ratio, which is usually not a 96 00:04:49,120 --> 00:04:52,360 Speaker 1: very bullish sign for the broader economy. Um, I think 97 00:04:52,360 --> 00:04:55,320 Speaker 1: that copper really has a lot of headwinds against it. 98 00:04:55,880 --> 00:04:59,360 Speaker 1: I don't see it continuing to to rally because, um, 99 00:04:59,400 --> 00:05:01,640 Speaker 1: the stock aisles in London are rather high right now. 100 00:05:01,680 --> 00:05:03,560 Speaker 1: I've heard a lot of people point to this gap 101 00:05:03,600 --> 00:05:06,440 Speaker 1: between gold and copper. Can you walk us through why 102 00:05:06,440 --> 00:05:09,719 Speaker 1: this is such an important metric that people watch? Sure, because, 103 00:05:09,760 --> 00:05:12,000 Speaker 1: as you said, Dr, copper kind of is the bell 104 00:05:12,080 --> 00:05:15,800 Speaker 1: weather for the commodities and manufacturing sector. And although we 105 00:05:15,880 --> 00:05:18,640 Speaker 1: lump gold in with the other commodities, it has this 106 00:05:18,800 --> 00:05:24,080 Speaker 1: unique monetary uh property to it, and so comparing gold 107 00:05:24,120 --> 00:05:27,919 Speaker 1: to copper is really looking at that divergence between what 108 00:05:28,080 --> 00:05:30,760 Speaker 1: is going on in the real economy and manufacturing and 109 00:05:30,760 --> 00:05:34,479 Speaker 1: then what is the sentiment in financial markets. So when 110 00:05:34,520 --> 00:05:37,360 Speaker 1: gold is higher obviously means that fear and uncertainty are 111 00:05:37,440 --> 00:05:40,320 Speaker 1: usually high. Um if copper is coming along with it, 112 00:05:40,680 --> 00:05:45,760 Speaker 1: then that shows that manufacturing and mining are all expecting 113 00:05:45,800 --> 00:05:48,680 Speaker 1: to see the commodities complex rise along with it, and 114 00:05:48,800 --> 00:05:50,560 Speaker 1: right now we're seeing the opposite of that. So that's 115 00:05:50,560 --> 00:05:53,000 Speaker 1: why it's such a key indicator. So again, gold here 116 00:05:53,080 --> 00:05:55,960 Speaker 1: up one point eight point one point eight four percent 117 00:05:56,040 --> 00:06:00,120 Speaker 1: today sixteen dollars seventy three dollars dollars announce Are you 118 00:06:00,120 --> 00:06:02,880 Speaker 1: send you when you talk to your clients speculation creeping 119 00:06:02,880 --> 00:06:05,760 Speaker 1: into the market. Are people speculating on gold saying what 120 00:06:05,920 --> 00:06:08,000 Speaker 1: this thing is running, I gotta get gotta get into it? 121 00:06:08,360 --> 00:06:11,200 Speaker 1: Um more so. Now, yes, there's definitely a bit of 122 00:06:11,240 --> 00:06:13,880 Speaker 1: bleed over of fomo um like we saw in the 123 00:06:13,880 --> 00:06:16,360 Speaker 1: equity market earlier this year, that's now kind of been 124 00:06:16,720 --> 00:06:20,280 Speaker 1: transferred over to gold. But I think another reason that 125 00:06:20,360 --> 00:06:23,320 Speaker 1: you're seeing sort of a speculative fervor for gold is 126 00:06:23,400 --> 00:06:26,320 Speaker 1: the expectation that central banks are going to continue to 127 00:06:26,320 --> 00:06:30,240 Speaker 1: ease policy and step in when necessary. Um. Those tools 128 00:06:30,240 --> 00:06:33,440 Speaker 1: are going to be tested in central banks, not just 129 00:06:33,480 --> 00:06:36,000 Speaker 1: the FED, but globally, as we've seen with the PBOC 130 00:06:36,240 --> 00:06:38,800 Speaker 1: has also stepped in with more stimulus. So that is 131 00:06:38,800 --> 00:06:41,040 Speaker 1: the narrative I'll be watching for the rest of the year, 132 00:06:41,080 --> 00:06:43,320 Speaker 1: and I think it's going to cause quite a bit 133 00:06:43,320 --> 00:06:45,680 Speaker 1: of volatility on top of that. Thank you so much, 134 00:06:45,680 --> 00:06:47,479 Speaker 1: Everett Melbourne. Thank you so much for being with us. 135 00:06:47,520 --> 00:06:51,240 Speaker 1: Everett Melmann, precious Metals specialist at Gainesville Coins, joining us 136 00:06:51,279 --> 00:06:58,040 Speaker 1: here in our interactive broker studios. On the one side 137 00:06:58,040 --> 00:07:01,760 Speaker 1: of markets today, you have these spreading of the coronavirus 138 00:07:01,839 --> 00:07:05,080 Speaker 1: and all of the fear of economic slowdown that ensues 139 00:07:05,240 --> 00:07:07,960 Speaker 1: from that. On the other side, you have political risk 140 00:07:08,040 --> 00:07:13,800 Speaker 1: political discussions going on as the Democratic Convention looks toward 141 00:07:14,160 --> 00:07:18,280 Speaker 1: South Carolina Tuesday, the debates happen, uh, and we are 142 00:07:18,360 --> 00:07:21,840 Speaker 1: getting a sense Bernie Sanders is the front runner that 143 00:07:21,920 --> 00:07:24,480 Speaker 1: needs to be beaten for any of the other candidates 144 00:07:24,520 --> 00:07:27,480 Speaker 1: to really emerge in a competitive way. Joining us now 145 00:07:27,560 --> 00:07:30,120 Speaker 1: is Chris Lew, former Deputy Secretary of Labor and senior 146 00:07:30,120 --> 00:07:33,760 Speaker 1: Fellow at the University of Virginia Miller Center. Also someone 147 00:07:33,800 --> 00:07:37,440 Speaker 1: who has spent decades in public service, working for the 148 00:07:37,520 --> 00:07:41,720 Speaker 1: Obama administration and beyond. Chris, thank you so much for 149 00:07:41,760 --> 00:07:44,520 Speaker 1: being with us. I want to just start with Bernie 150 00:07:44,560 --> 00:07:48,440 Speaker 1: Sanders and his acceptance or lack thereof among the sort 151 00:07:48,440 --> 00:07:52,160 Speaker 1: of more conventional Democratic Party. Are people starting to accept 152 00:07:52,240 --> 00:07:55,320 Speaker 1: him more or people really pushing back within the Democratic 153 00:07:55,360 --> 00:07:59,000 Speaker 1: Party on his nomination. Well, I think you see both. 154 00:07:59,040 --> 00:08:01,320 Speaker 1: But I would also call and people, look, we have 155 00:08:01,480 --> 00:08:04,440 Speaker 1: three states that have voted, three relatively small states, and yes, 156 00:08:05,040 --> 00:08:07,720 Speaker 1: Senator Sanders has a huge amount of momentum right now, 157 00:08:07,920 --> 00:08:10,600 Speaker 1: especially as early voting goes on for Super Tuesday, which 158 00:08:10,640 --> 00:08:13,200 Speaker 1: is next Tuesday. But we've got a long way to go. 159 00:08:13,360 --> 00:08:15,320 Speaker 1: You know, as I always point out to people, more 160 00:08:15,360 --> 00:08:18,600 Speaker 1: delicates are going to be allocated April, May and June 161 00:08:19,280 --> 00:08:22,040 Speaker 1: than on Super Tuesday. Next week. And so look, I 162 00:08:22,080 --> 00:08:24,040 Speaker 1: think this is still a pretty fluid race. And as 163 00:08:24,080 --> 00:08:27,080 Speaker 1: we saw from last week's debate, um, you know, things 164 00:08:27,120 --> 00:08:30,400 Speaker 1: can still change. So Chris, there's actually some growing concern 165 00:08:30,480 --> 00:08:33,640 Speaker 1: that we've heard just recently that with Bernie Sanders in 166 00:08:33,640 --> 00:08:36,240 Speaker 1: the league that were he to be the nominee, he 167 00:08:36,280 --> 00:08:39,480 Speaker 1: would actually cause perhaps you know, the Democrats to lose 168 00:08:39,520 --> 00:08:43,920 Speaker 1: seats in Congress. Is that avoid concern? It is? Look, 169 00:08:44,000 --> 00:08:45,560 Speaker 1: I yeah, and I think this is a concern for 170 00:08:45,720 --> 00:08:47,680 Speaker 1: I think all all when you look at any of 171 00:08:47,679 --> 00:08:50,080 Speaker 1: the candidates, not how well you do in terms of 172 00:08:50,080 --> 00:08:53,000 Speaker 1: winning the White House, and I and I'm I am 173 00:08:53,040 --> 00:08:55,360 Speaker 1: confident that any of them has a pretty decent chance 174 00:08:55,400 --> 00:08:58,240 Speaker 1: of beating Donald Trump. But it's what you do down ballot. 175 00:08:58,440 --> 00:09:00,760 Speaker 1: I think part of the challenges what we don't know 176 00:09:00,880 --> 00:09:03,040 Speaker 1: is what's the theory of the case. Is the theory 177 00:09:03,040 --> 00:09:06,040 Speaker 1: of the case the Democrats need a nominee that attacks 178 00:09:06,120 --> 00:09:08,120 Speaker 1: to the center to try to pick them pick up 179 00:09:08,160 --> 00:09:11,880 Speaker 1: some independence and never trump Trumpers, Or is the theory 180 00:09:11,920 --> 00:09:15,440 Speaker 1: of the case to expand the electorate and can somebody 181 00:09:15,480 --> 00:09:19,200 Speaker 1: like a uh, Bernie Sanders bring in young voters, people 182 00:09:19,200 --> 00:09:21,400 Speaker 1: of color. A lot of the people that voted for 183 00:09:21,600 --> 00:09:25,360 Speaker 1: Barack Obama two thousand and eight but sat out in Chris, 184 00:09:25,400 --> 00:09:28,560 Speaker 1: you said you think that any of the candidates have 185 00:09:28,600 --> 00:09:31,280 Speaker 1: a good chance of beating President Trump. Do you think 186 00:09:31,480 --> 00:09:35,720 Speaker 1: that there is too much being made that Senator Sanders 187 00:09:35,800 --> 00:09:38,800 Speaker 1: has a terrible chance or the worst chance against President 188 00:09:38,840 --> 00:09:42,160 Speaker 1: Trump of all of the candidates. You know, Look, I mean, 189 00:09:42,720 --> 00:09:46,559 Speaker 1: if you base it simply on a pose right now, um, 190 00:09:46,640 --> 00:09:48,520 Speaker 1: you would be hard pressed to say that Sanders is 191 00:09:48,559 --> 00:09:51,320 Speaker 1: any less selectable than any of the other candidates. In fact, 192 00:09:51,320 --> 00:09:53,640 Speaker 1: he polls quite well. I would also caution people, I 193 00:09:53,640 --> 00:09:55,400 Speaker 1: think those head to head match ups are a little 194 00:09:55,400 --> 00:09:58,480 Speaker 1: misleading this early. You really have to look down at 195 00:09:58,520 --> 00:10:00,800 Speaker 1: the battleground states and we are long way. I mean, 196 00:10:00,920 --> 00:10:04,720 Speaker 1: once this um, this nomination battle gets settled, no matter 197 00:10:04,760 --> 00:10:07,280 Speaker 1: who it is, how well does the party come together, 198 00:10:07,720 --> 00:10:10,400 Speaker 1: what does the convention look like? And then a lot 199 00:10:10,440 --> 00:10:12,280 Speaker 1: of this, frankly, is about money. And I think what 200 00:10:12,640 --> 00:10:16,000 Speaker 1: people should be impressed by if you on Democrats, if 201 00:10:16,000 --> 00:10:19,000 Speaker 1: you're concerned about Sanders, is his ability to raise money 202 00:10:19,040 --> 00:10:23,000 Speaker 1: without holding fundraisers is actually pretty extraordinary. So, Chris, we've 203 00:10:23,040 --> 00:10:25,880 Speaker 1: heard some discussion kind of ramping up recently about a 204 00:10:26,040 --> 00:10:30,400 Speaker 1: brokered convention. You define what a brokered convention is and 205 00:10:30,480 --> 00:10:33,640 Speaker 1: how it might play out this time around. Well, and 206 00:10:33,679 --> 00:10:35,760 Speaker 1: I have a special perspective on this. I'm a d 207 00:10:35,920 --> 00:10:37,839 Speaker 1: n C super delegate as well, so at some point 208 00:10:37,880 --> 00:10:39,800 Speaker 1: in the process I will get to stay on the nominee. 209 00:10:40,200 --> 00:10:42,200 Speaker 1: So essentially, what it means is that if no one 210 00:10:42,280 --> 00:10:45,640 Speaker 1: can get a majority of the delegates on the first 211 00:10:45,679 --> 00:10:48,599 Speaker 1: ballot um, and then by the time you get to 212 00:10:48,640 --> 00:10:51,280 Speaker 1: the second ballot, we should say on the first ballot 213 00:10:51,320 --> 00:10:53,920 Speaker 1: you are pledged to vote for the candidates who you know, 214 00:10:54,240 --> 00:10:57,320 Speaker 1: who you supported. By the second ballot um, you know, 215 00:10:57,600 --> 00:10:59,800 Speaker 1: candidates can cut deals with other ones, they can be 216 00:11:00,080 --> 00:11:02,679 Speaker 1: their delegates. Super delegates don't get a chance to vote 217 00:11:02,760 --> 00:11:06,160 Speaker 1: until the second ballot um. And again I don't want 218 00:11:06,160 --> 00:11:08,000 Speaker 1: to go down that road because I'm still not sure 219 00:11:08,000 --> 00:11:10,560 Speaker 1: we're going to get there right now. But you could 220 00:11:10,559 --> 00:11:14,559 Speaker 1: basically have you know, multiple voting where you know, different 221 00:11:14,600 --> 00:11:17,640 Speaker 1: candidates drop out in um, you have different coalitions formings. 222 00:11:17,640 --> 00:11:20,199 Speaker 1: I don't think we've had one since nineteen fifty two 223 00:11:20,280 --> 00:11:23,000 Speaker 1: or so. There's a huge risk here. I mean, this 224 00:11:23,040 --> 00:11:25,200 Speaker 1: is what happened with Hillary Clinton and Bernie Sanders the 225 00:11:25,240 --> 00:11:28,080 Speaker 1: last time around, in a lot of people felt like 226 00:11:28,120 --> 00:11:32,640 Speaker 1: the establishment, to use President Trump's word, really hijacked Bernie 227 00:11:32,640 --> 00:11:35,840 Speaker 1: Sanders campaign, and that you know, there's a risk that 228 00:11:35,880 --> 00:11:38,320 Speaker 1: there's going to be a repeat of that. I mean, 229 00:11:38,320 --> 00:11:40,400 Speaker 1: how worried are you that that is sort of going 230 00:11:40,440 --> 00:11:43,839 Speaker 1: to be the impression? Yeah, you know, and this is 231 00:11:43,880 --> 00:11:46,719 Speaker 1: part of why, you know, as a DNC superdelegate, I'm 232 00:11:46,760 --> 00:11:50,720 Speaker 1: not endorsing anybody. I'm not. I look, my view is 233 00:11:50,800 --> 00:11:54,439 Speaker 1: we're Democrats. Let Democrats believe everyone should vote. Let's let 234 00:11:54,520 --> 00:11:57,440 Speaker 1: everyone in all fifty states and the you know, the 235 00:11:57,520 --> 00:12:00,120 Speaker 1: seven territories vote and then let's see what happens or 236 00:12:00,160 --> 00:12:03,520 Speaker 1: that um because I think there there's a concern that 237 00:12:03,559 --> 00:12:05,200 Speaker 1: if you try to put your thumb on the scale 238 00:12:05,200 --> 00:12:08,160 Speaker 1: too much, either for against Bernie Sanders, that just you know, 239 00:12:08,320 --> 00:12:10,600 Speaker 1: upsets you know, people on one side. You know, we've 240 00:12:10,600 --> 00:12:13,960 Speaker 1: only worked freaked states into this. Let's let the other 241 00:12:14,080 --> 00:12:16,880 Speaker 1: you know, fifty sum go ahead and vote first. Chris, 242 00:12:16,920 --> 00:12:20,360 Speaker 1: is there a sense within the Democratic um power structure, 243 00:12:20,360 --> 00:12:24,480 Speaker 1: if you will, the party, the national Committee, who actually 244 00:12:24,600 --> 00:12:28,960 Speaker 1: is the best candidate against President Trump? Well, and that's hard, 245 00:12:29,120 --> 00:12:30,760 Speaker 1: you know, for most of last year we thought it 246 00:12:30,840 --> 00:12:33,040 Speaker 1: was a Joe Biden, and you know, he still pulls 247 00:12:33,040 --> 00:12:35,480 Speaker 1: pretty well. But obviously, you know, we've seen, you know, 248 00:12:35,520 --> 00:12:38,840 Speaker 1: with mayor Bloomberg coming up. And you know what's interesting, however, 249 00:12:38,920 --> 00:12:40,720 Speaker 1: is that when you look at the public opinion polls, 250 00:12:41,679 --> 00:12:45,959 Speaker 1: President Trump basically gets about forty four percent against every 251 00:12:46,000 --> 00:12:49,400 Speaker 1: Democrat and reminder, reminder, he got forty six percent a 252 00:12:49,400 --> 00:12:51,959 Speaker 1: on Hillary Clinton. So he basically is hitting where his 253 00:12:52,080 --> 00:12:54,600 Speaker 1: feeling is right now. So from my perspective as a 254 00:12:54,640 --> 00:12:57,920 Speaker 1: Democratic strategist, um, the key is that they're not the 255 00:12:58,000 --> 00:13:00,880 Speaker 1: a third party candidate and that the Democrats come in 256 00:13:01,200 --> 00:13:04,520 Speaker 1: relatively united. And I think that's possible even after what 257 00:13:04,640 --> 00:13:07,920 Speaker 1: happened in which was pretty contentious on the Democratic side, 258 00:13:08,200 --> 00:13:10,800 Speaker 1: you largely had people you know, in the Sanders camp 259 00:13:10,800 --> 00:13:13,560 Speaker 1: sort of fold back together and vote for Hillary Clinton. 260 00:13:14,120 --> 00:13:16,760 Speaker 1: So on Tuesday's debate, Tomorrow's debate, we are going to 261 00:13:16,800 --> 00:13:19,360 Speaker 1: see the second performance from Michael Bloomberg, who is the 262 00:13:19,360 --> 00:13:21,600 Speaker 1: founder and majority owner of Bloomberg Elpa and the owner 263 00:13:21,600 --> 00:13:24,120 Speaker 1: of this radio station. Uh should get that in there. 264 00:13:24,160 --> 00:13:27,080 Speaker 1: Also Tom Steyer, another billionaire, is going to be on 265 00:13:27,120 --> 00:13:29,960 Speaker 1: the stage there, and I'm wondering what would you like 266 00:13:30,080 --> 00:13:31,840 Speaker 1: to see how much would you like to see the 267 00:13:31,880 --> 00:13:35,760 Speaker 1: field contract in order to create momentum behind one candidate 268 00:13:36,040 --> 00:13:38,920 Speaker 1: in the near term. Yeah, and I would like to 269 00:13:38,920 --> 00:13:41,120 Speaker 1: see the field contract. I think that's the important thing. 270 00:13:41,120 --> 00:13:44,600 Speaker 1: And I take nothing away from Senator Standers performance in Nevada. 271 00:13:44,640 --> 00:13:48,280 Speaker 1: He did incredibly well far stated expectations. But there's still, 272 00:13:48,559 --> 00:13:51,600 Speaker 1: you know, well over let's say six people in the 273 00:13:51,679 --> 00:13:55,760 Speaker 1: Democratic primary or caucus in Nevada who voted for somebody else. 274 00:13:55,960 --> 00:13:57,640 Speaker 1: And I just don't think we have a great sense 275 00:13:57,640 --> 00:14:00,440 Speaker 1: of who is really the person that is after the 276 00:14:00,480 --> 00:14:03,840 Speaker 1: broadest coalition until we see the field shrink down. The 277 00:14:03,960 --> 00:14:06,640 Speaker 1: problem is you've got, you know, candidates who can self 278 00:14:06,679 --> 00:14:10,480 Speaker 1: fund who don't answer to party establishment, or you've got 279 00:14:10,480 --> 00:14:14,160 Speaker 1: candidates who can largely raise money through small dollars who 280 00:14:14,200 --> 00:14:17,560 Speaker 1: don't answer to party officials as well. So it is 281 00:14:17,640 --> 00:14:19,760 Speaker 1: kind of the wild West, and this is just the 282 00:14:19,760 --> 00:14:22,280 Speaker 1: way we are right now in Chris, thanks so much 283 00:14:22,280 --> 00:14:25,120 Speaker 1: for joining us. We always appreciate your thoughts. Chris Lew 284 00:14:25,200 --> 00:14:27,800 Speaker 1: Senior Fellow at the University of Virginia Miller Center, former 285 00:14:27,960 --> 00:14:31,120 Speaker 1: Deputy Secretary of Labor under President Obama. Joining us on 286 00:14:31,200 --> 00:14:46,120 Speaker 1: the phone the sentiment this morning very much being driven 287 00:14:46,200 --> 00:14:49,600 Speaker 1: by a spread of the coronavirus outside of China, where 288 00:14:49,640 --> 00:14:53,920 Speaker 1: the number of cases appears to be stabilizing to some degree. However, 289 00:14:53,920 --> 00:14:56,880 Speaker 1: the focus very much turning to Italy, where a number 290 00:14:56,920 --> 00:15:00,480 Speaker 1: of towns are seeing the cases arise exponentially. Joining us 291 00:15:00,480 --> 00:15:05,000 Speaker 1: now from Milan is Fernando Fernando Giuliano. He's an editor 292 00:15:05,040 --> 00:15:08,520 Speaker 1: for Bloomberg Opinion, and Fernando, we're really glad to have 293 00:15:08,600 --> 00:15:11,600 Speaker 1: you to give us a sense of what is actually 294 00:15:11,680 --> 00:15:15,360 Speaker 1: happening on the ground, how significant and prevailing is the 295 00:15:15,360 --> 00:15:19,640 Speaker 1: threat and the fear of the coronavirus there. Well, it 296 00:15:19,760 --> 00:15:22,600 Speaker 1: is real. I mean, remember there are now around fifty 297 00:15:23,160 --> 00:15:27,720 Speaker 1: people in lockdown in southern Lombardy that's just south of Milan. 298 00:15:28,480 --> 00:15:33,280 Speaker 1: That's the area where the first cases were registered. And 299 00:15:33,400 --> 00:15:36,360 Speaker 1: actually you cannot get out or coming to the area 300 00:15:36,440 --> 00:15:39,400 Speaker 1: Monstery and you can't get out. And now there is 301 00:15:39,440 --> 00:15:43,120 Speaker 1: a other other regions quite you know, basically the whole 302 00:15:43,120 --> 00:15:46,560 Speaker 1: of northern Italy. So regions like Benetto or Lambardy where 303 00:15:46,560 --> 00:15:51,960 Speaker 1: they've been cases are not in lockdown, but school are closed, 304 00:15:52,000 --> 00:15:57,000 Speaker 1: they're canceling major events, social events like the carnival or 305 00:15:57,040 --> 00:16:00,720 Speaker 1: you know the football matches. Um, where we're all so canceled, 306 00:16:01,280 --> 00:16:03,640 Speaker 1: and a lot of people are working from home. Lots 307 00:16:03,640 --> 00:16:06,640 Speaker 1: of companies are encouraging people to you know, the smart 308 00:16:06,680 --> 00:16:09,680 Speaker 1: work from home. Then it really depends on people kind 309 00:16:09,680 --> 00:16:11,840 Speaker 1: of wander around and go for a walk and I'm 310 00:16:11,840 --> 00:16:15,920 Speaker 1: not particularly bothered. Others are terrified and stay at home 311 00:16:15,960 --> 00:16:17,920 Speaker 1: and I don't want to get out. So it's uh, 312 00:16:18,560 --> 00:16:21,000 Speaker 1: it's really that it's very very uncertain. People don't really 313 00:16:21,040 --> 00:16:25,400 Speaker 1: know how much to fear what to fear exactly, and 314 00:16:25,840 --> 00:16:28,440 Speaker 1: it's also not clear what the you know, how what 315 00:16:28,480 --> 00:16:31,560 Speaker 1: are the consequences of this virus. Some people have already 316 00:16:31,560 --> 00:16:35,240 Speaker 1: already died in easily six people. They were all quite 317 00:16:35,280 --> 00:16:39,760 Speaker 1: old and some had previous condition conditions. But you know, 318 00:16:39,960 --> 00:16:42,840 Speaker 1: it's still you know, what's happening in China's pretty terrifying 319 00:16:42,880 --> 00:16:45,640 Speaker 1: and for everyone to see so Um, clearly a lot 320 00:16:45,680 --> 00:16:48,080 Speaker 1: of people are very mindful of what's happening. So for anoder, 321 00:16:48,080 --> 00:16:50,760 Speaker 1: is there a sense of how it got to Italy? 322 00:16:52,080 --> 00:16:55,760 Speaker 1: Oh no, that's the possibly the most frightening part of 323 00:16:55,800 --> 00:17:00,880 Speaker 1: it all. Um. We had a few cases in towards 324 00:17:00,920 --> 00:17:02,840 Speaker 1: the end of last week mid last week in in 325 00:17:02,880 --> 00:17:06,840 Speaker 1: these two areas in Benetto and in Lombardy. But it's 326 00:17:06,840 --> 00:17:10,440 Speaker 1: not clear how. God is not that there was like 327 00:17:10,480 --> 00:17:13,879 Speaker 1: an obvious connection to China. And it's not even clear 328 00:17:13,960 --> 00:17:17,440 Speaker 1: how these two separate areas of the country, which are 329 00:17:17,760 --> 00:17:22,080 Speaker 1: close but not to close, both became infected at the 330 00:17:22,240 --> 00:17:25,800 Speaker 1: same time. So the authorities are still scrambling to to 331 00:17:25,880 --> 00:17:30,560 Speaker 1: find these patient zero as they call it. At the moment, 332 00:17:30,640 --> 00:17:34,000 Speaker 1: no success. Fernando, It's interesting to see right now the 333 00:17:34,040 --> 00:17:38,320 Speaker 1: reaction in the bond and stock markets in Italy suffering 334 00:17:38,359 --> 00:17:41,160 Speaker 1: some of the biggest moves since two thousand and sixteen, 335 00:17:41,520 --> 00:17:44,520 Speaker 1: and they're borrowing costs jumping. I'm just wondering, can you 336 00:17:44,560 --> 00:17:48,760 Speaker 1: speak to the fundamental picture of the Italian government? How 337 00:17:49,440 --> 00:17:52,560 Speaker 1: how much do they have to withstand a potential disruption 338 00:17:52,600 --> 00:17:57,000 Speaker 1: and financial markets from a financial perspective, Well, look, I 339 00:17:57,040 --> 00:18:01,119 Speaker 1: think in terms of government bonds, yes, they spike this morning, 340 00:18:01,160 --> 00:18:04,080 Speaker 1: but there are ten years bonds for Italy are still 341 00:18:04,080 --> 00:18:06,800 Speaker 1: below one percent. The one needs to keep some perspective. 342 00:18:06,840 --> 00:18:09,520 Speaker 1: You know, there's a country which has been seeing you know, 343 00:18:09,760 --> 00:18:11,920 Speaker 1: bond deals at ten years for ten years at six 344 00:18:11,960 --> 00:18:15,120 Speaker 1: seven percent during the crimeroson crisis because still very very 345 00:18:15,160 --> 00:18:19,080 Speaker 1: low level and also equity levels. You know, we're pretty 346 00:18:19,160 --> 00:18:21,920 Speaker 1: high anyway, but you know that the real war is 347 00:18:21,960 --> 00:18:24,560 Speaker 1: over the really column. You know, you have some of 348 00:18:24,600 --> 00:18:28,360 Speaker 1: the most richest and most industrialized parts of Italy which 349 00:18:28,359 --> 00:18:31,879 Speaker 1: are now in the usual lockdown. You know, the consequences 350 00:18:31,920 --> 00:18:34,720 Speaker 1: for supply are going to be big and same with 351 00:18:34,800 --> 00:18:37,520 Speaker 1: demand and the tourist industry is bound to software as 352 00:18:37,560 --> 00:18:41,600 Speaker 1: well as people cancel their holidays. So I think the 353 00:18:41,960 --> 00:18:45,439 Speaker 1: government is looking at putting together a package of the 354 00:18:45,440 --> 00:18:49,560 Speaker 1: economic help for you know, the affected industry, but you know, 355 00:18:49,720 --> 00:18:53,040 Speaker 1: the impact is going to be very severe. So for another, 356 00:18:53,160 --> 00:18:57,680 Speaker 1: is there a sense that from a health perspective that 357 00:18:57,800 --> 00:19:00,760 Speaker 1: the government is doing everything at needs to do. What's 358 00:19:00,800 --> 00:19:03,720 Speaker 1: kind of the feeling on the ground. Well, you know, 359 00:19:03,720 --> 00:19:06,920 Speaker 1: there are questions where you know, the the initial outbreak 360 00:19:06,960 --> 00:19:09,679 Speaker 1: would have been prevented or not. There are lots of 361 00:19:09,960 --> 00:19:13,120 Speaker 1: theories going around. Some people say that this flight ban, 362 00:19:13,280 --> 00:19:16,399 Speaker 1: which the Italian government alone or you know, was one 363 00:19:16,440 --> 00:19:19,080 Speaker 1: of very few countries Europe to implement, may have actually 364 00:19:19,359 --> 00:19:22,200 Speaker 1: worsened the situation because it made it harder for people 365 00:19:22,240 --> 00:19:24,560 Speaker 1: to uh, you know, for the authorities to keep track 366 00:19:24,600 --> 00:19:26,440 Speaker 1: of people coming from China. This was a flight plan 367 00:19:26,520 --> 00:19:30,840 Speaker 1: from China. Um um. But at the same time, you know, 368 00:19:30,920 --> 00:19:34,040 Speaker 1: now the response has been very forceful. There are some 369 00:19:34,119 --> 00:19:37,560 Speaker 1: people who fear it's a little bit exaggerate or too little, 370 00:19:37,600 --> 00:19:40,280 Speaker 1: too late. But actually, you know, if you talk too 371 00:19:40,359 --> 00:19:43,480 Speaker 1: many experts, they are being very complementary of these very 372 00:19:43,480 --> 00:19:46,879 Speaker 1: tough measures for Coonian measures which are being implemented, and 373 00:19:46,960 --> 00:19:50,800 Speaker 1: say it's exactly what one needs to happen. Um As 374 00:19:50,800 --> 00:19:52,399 Speaker 1: I say, you know, it's all very uncertain, so we 375 00:19:52,440 --> 00:19:55,760 Speaker 1: don't know, but you know, certainly the measures are being 376 00:19:56,200 --> 00:19:59,200 Speaker 1: implemented in a very forceful manner at the moment. Fernando, 377 00:19:59,359 --> 00:20:02,160 Speaker 1: just real quickly. Here you are currently in Naples, your 378 00:20:02,160 --> 00:20:04,600 Speaker 1: wife is in Milan. When is the next time you 379 00:20:04,600 --> 00:20:07,760 Speaker 1: guys will be able to travel to see each other? Well, 380 00:20:07,800 --> 00:20:09,439 Speaker 1: I don't know. I mean, I'm kind of looking at 381 00:20:09,480 --> 00:20:13,359 Speaker 1: the news myself on a daily basis to understand, you know, 382 00:20:13,400 --> 00:20:16,000 Speaker 1: when I when I'm going to move back. Um, you know, 383 00:20:16,040 --> 00:20:18,080 Speaker 1: one thing is shut is certain. I'm going to travel 384 00:20:18,160 --> 00:20:20,600 Speaker 1: back car this time rather than taking the train, because 385 00:20:20,600 --> 00:20:22,679 Speaker 1: you know, the trains are not too you know, are 386 00:20:22,720 --> 00:20:24,320 Speaker 1: not exactly the kind of place where you want to 387 00:20:24,359 --> 00:20:26,840 Speaker 1: be right now, whereas you know, at least your own car. 388 00:20:26,920 --> 00:20:29,920 Speaker 1: It's just you, So I don't think you know, one 389 00:20:30,200 --> 00:20:32,800 Speaker 1: one should exaggerate what's going on. We're gonna see each 390 00:20:32,800 --> 00:20:35,560 Speaker 1: other very soon. You know, I'm gonna be mindful of 391 00:20:35,560 --> 00:20:38,720 Speaker 1: how I get there right, all right, Fernando, you'd be safe, okay, 392 00:20:38,800 --> 00:20:41,760 Speaker 1: and your wife as well. Fernando Giuliano, Editor Bloomberg Opinion 393 00:20:42,280 --> 00:20:45,680 Speaker 1: in Naples, Uh, Italy, right now, give you us the 394 00:20:45,760 --> 00:20:48,560 Speaker 1: latest on the coronavirus uh there, which is you know, 395 00:20:48,640 --> 00:20:51,480 Speaker 1: really kind of change the tone of how the market's 396 00:20:51,480 --> 00:20:54,760 Speaker 1: perception of this virus as it now is firmly entrenched 397 00:20:54,800 --> 00:21:04,320 Speaker 1: on the European continent. In northern Italy, European stocks had 398 00:21:04,320 --> 00:21:07,120 Speaker 1: their worst day since in the US, who had all 399 00:21:07,320 --> 00:21:12,280 Speaker 1: major US indices starting to open down more than three percent. 400 00:21:12,440 --> 00:21:15,960 Speaker 1: Over in China, however, the share price has been muted, 401 00:21:16,240 --> 00:21:20,080 Speaker 1: actually with declines that are much smaller than what we're 402 00:21:20,080 --> 00:21:22,280 Speaker 1: seeing over in Europe and here in the US. Joining 403 00:21:22,320 --> 00:21:24,160 Speaker 1: us out to talk about what to expect going forward. 404 00:21:24,160 --> 00:21:27,480 Speaker 1: Brendan to Herne, chief investment officer a Crane Shares based 405 00:21:27,520 --> 00:21:30,720 Speaker 1: in New York, focused on China stocks in particular, and 406 00:21:30,760 --> 00:21:34,119 Speaker 1: I'm wondering, Brendan, from your perspective, is what we're seeing 407 00:21:34,320 --> 00:21:37,560 Speaker 1: in Chinese equities just a big bet that the People's 408 00:21:37,600 --> 00:21:40,199 Speaker 1: Bank of China will come in with any kind of 409 00:21:40,200 --> 00:21:44,120 Speaker 1: stimulus to stave off steeper declines. Well, and I think 410 00:21:44,119 --> 00:21:47,239 Speaker 1: that's certainly a factor. Lisa. You also have not just 411 00:21:47,320 --> 00:21:50,880 Speaker 1: the pd o C, but you have fiscal policy, you 412 00:21:51,000 --> 00:21:55,760 Speaker 1: have stimulus from the Ministry of Transportation. You know, you 413 00:21:55,840 --> 00:21:59,359 Speaker 1: have really a consensus to offset the weakness we're going 414 00:21:59,400 --> 00:22:01,439 Speaker 1: to have in you one, We're gonna make it up 415 00:22:01,520 --> 00:22:04,879 Speaker 1: in Q two, Q three, and Q four. So, Brendan, 416 00:22:05,080 --> 00:22:08,840 Speaker 1: that scenario suggests that the markets discounting that this thing 417 00:22:08,920 --> 00:22:12,840 Speaker 1: is at or near peaking in terms of severity. Is 418 00:22:12,840 --> 00:22:17,359 Speaker 1: there any real evidence to back that up? In China, Paul, 419 00:22:17,600 --> 00:22:21,359 Speaker 1: the cases appear to have PLATEAD, and that that was 420 00:22:21,480 --> 00:22:24,760 Speaker 1: the bottom that we saw back with stars going back 421 00:22:24,800 --> 00:22:27,879 Speaker 1: to uh, you know, almost twenty years ago. So so 422 00:22:27,920 --> 00:22:31,359 Speaker 1: the market is forward looking is saying the actual cases 423 00:22:31,800 --> 00:22:35,080 Speaker 1: have plateaud and China's going back to work in a 424 00:22:35,200 --> 00:22:39,560 Speaker 1: very significant fashion. Therefore, you're starting to see a pick 425 00:22:39,600 --> 00:22:42,680 Speaker 1: up in some of the high frequency economic data and 426 00:22:42,840 --> 00:22:45,320 Speaker 1: that's part of the reason you're seeing the markets respond 427 00:22:45,400 --> 00:22:48,439 Speaker 1: in a positive fashion. UM. What's important though, that this 428 00:22:48,520 --> 00:22:52,159 Speaker 1: is mainly in China. Uh. If your definition of China 429 00:22:52,359 --> 00:22:57,199 Speaker 1: is Hong Kong or stocks or US list of Chinese companies, 430 00:22:57,240 --> 00:23:01,679 Speaker 1: those are predominantly owned by foreign investors. They're selling, but 431 00:23:01,760 --> 00:23:06,359 Speaker 1: the actual mainland Chinese investors are buying an important disparity. Yeah, 432 00:23:06,400 --> 00:23:09,119 Speaker 1: looking at the at the Hang Seng Index in Hong Kong, 433 00:23:09,720 --> 00:23:12,080 Speaker 1: which was down one point eight percent overnight, which was 434 00:23:12,160 --> 00:23:15,280 Speaker 1: much more than the Shanghai Stock Exchange Composite, for example, 435 00:23:15,280 --> 00:23:17,880 Speaker 1: which was down just about three tenths of a percent. 436 00:23:18,440 --> 00:23:21,359 Speaker 1: That said, I mean you talked about stars. It is 437 00:23:21,400 --> 00:23:23,919 Speaker 1: a very different period of time than stars, and this 438 00:23:23,960 --> 00:23:26,520 Speaker 1: is a very different illness than stars. Given how contagious 439 00:23:26,600 --> 00:23:30,399 Speaker 1: it is, I'm wondering, as an investor in Chinese equities, 440 00:23:30,400 --> 00:23:34,520 Speaker 1: how worried are you that as people within China start 441 00:23:34,600 --> 00:23:37,280 Speaker 1: going back to work, start going to the factories, we 442 00:23:37,359 --> 00:23:41,560 Speaker 1: get a re emergence of the coronavirus and it causes 443 00:23:41,560 --> 00:23:47,879 Speaker 1: a much longer term disruption. Who may providence, UM, where 444 00:23:47,920 --> 00:23:52,120 Speaker 1: the city of Wuhan is located, is is disproportionately a 445 00:23:52,200 --> 00:23:56,320 Speaker 1: very large percentage of the cases in China that remains 446 00:23:56,359 --> 00:23:59,520 Speaker 1: in quarantine. So so, I think that the view is 447 00:24:00,359 --> 00:24:03,840 Speaker 1: other parts of the country have not had very significant 448 00:24:03,920 --> 00:24:07,960 Speaker 1: levels of of this infectious disease, and therefore it's time 449 00:24:08,000 --> 00:24:09,719 Speaker 1: it's time to go back to work. You know that 450 00:24:09,760 --> 00:24:12,960 Speaker 1: they've kind of quarantined and contained, but the rest of 451 00:24:13,000 --> 00:24:15,159 Speaker 1: the country it's time to get back to work. So Brentan, 452 00:24:15,160 --> 00:24:17,439 Speaker 1: give us a sense of, um, how much of the 453 00:24:17,480 --> 00:24:20,720 Speaker 1: country and production is shut down. We've heard numbers as 454 00:24:20,760 --> 00:24:22,879 Speaker 1: high as maybe forty or fifty percent. What do you 455 00:24:22,880 --> 00:24:27,159 Speaker 1: think that is at the moment it's coming back? Paul 456 00:24:27,400 --> 00:24:32,400 Speaker 1: Um that that's certainly the Hubei providence itself big producer 457 00:24:32,560 --> 00:24:37,240 Speaker 1: of fish, shrimp, crabs, auto parts, textiles, cement, but but 458 00:24:37,400 --> 00:24:40,880 Speaker 1: less than five percent of China's aggregate GDP. So so 459 00:24:40,880 --> 00:24:45,080 Speaker 1: so you you have companies that are within the supply 460 00:24:45,160 --> 00:24:47,760 Speaker 1: chains within Whobei, but but it's not it's not a 461 00:24:47,800 --> 00:24:53,720 Speaker 1: massive amount. Aggregate utilization is picking up, so I would agree, 462 00:24:53,720 --> 00:24:58,680 Speaker 1: you know, probably about half to six is coming back online. Um, 463 00:24:58,720 --> 00:25:00,879 Speaker 1: and it's coming in incrementally week by week, or you know, 464 00:25:00,920 --> 00:25:03,520 Speaker 1: we're going to see an improvement. So Brendan. Given the 465 00:25:03,560 --> 00:25:07,320 Speaker 1: fact that you seem optimistic about a stabilization here and 466 00:25:07,359 --> 00:25:10,800 Speaker 1: are ramping up of business within China, are you buying 467 00:25:11,840 --> 00:25:14,719 Speaker 1: so on? On a personal basis, I am, I'll be 468 00:25:14,760 --> 00:25:18,200 Speaker 1: buying UH today. UM. I don't think you can plant 469 00:25:18,200 --> 00:25:20,040 Speaker 1: the flag and say this is the bottom, but I 470 00:25:20,040 --> 00:25:22,879 Speaker 1: think there's opportunities over the next several weeks. Remove this Friday. 471 00:25:22,920 --> 00:25:25,280 Speaker 1: We have China p m I numbers for the month 472 00:25:25,280 --> 00:25:27,040 Speaker 1: of February and we kind of know they're going to 473 00:25:27,080 --> 00:25:30,119 Speaker 1: be a disaster. Um So, so I think the headlines 474 00:25:30,200 --> 00:25:33,080 Speaker 1: around Friday UH could weigh on the markets a little bit, 475 00:25:33,119 --> 00:25:34,760 Speaker 1: but we know it's going to be bad, and that's 476 00:25:34,760 --> 00:25:37,240 Speaker 1: why I'm not saying that this is the bottom. But 477 00:25:37,280 --> 00:25:38,760 Speaker 1: over the next several weeks, I think there is a 478 00:25:38,760 --> 00:25:42,400 Speaker 1: great opportunity. But what are you buying? So? I eat 479 00:25:42,400 --> 00:25:44,520 Speaker 1: my own cooking. So I am a big investor in 480 00:25:44,760 --> 00:25:48,720 Speaker 1: our crane sharres ETFs. I love today our M S 481 00:25:48,720 --> 00:25:50,760 Speaker 1: c I China A E T F K B A 482 00:25:51,359 --> 00:25:55,200 Speaker 1: um US investors have sold it down almost three percent 483 00:25:55,520 --> 00:26:01,440 Speaker 1: below what it's worth. UM. Literally, it's it's it's trading down. UM. 484 00:26:01,480 --> 00:26:04,000 Speaker 1: I think mainland markets will be up tomorrow, So I'm 485 00:26:04,000 --> 00:26:05,600 Speaker 1: going to be a buyer of our k B a 486 00:26:06,280 --> 00:26:10,480 Speaker 1: UM And then I love our obviously our internet strategy 487 00:26:10,680 --> 00:26:13,840 Speaker 1: around the broader E m uh K Web and k 488 00:26:14,080 --> 00:26:15,879 Speaker 1: m Q are other big holdings of mine, and I 489 00:26:15,920 --> 00:26:17,639 Speaker 1: love those funds as well. I mean, these are like 490 00:26:17,680 --> 00:26:21,000 Speaker 1: my kids. But but I I'm heavily invested in in 491 00:26:21,040 --> 00:26:23,119 Speaker 1: the crane shares et f s, and I think as 492 00:26:23,119 --> 00:26:25,399 Speaker 1: a long term investor, I think this is a you know, 493 00:26:25,560 --> 00:26:27,520 Speaker 1: you know, when people puke things up, they give it 494 00:26:27,560 --> 00:26:29,600 Speaker 1: away for free. You know, as a long term investor, 495 00:26:29,600 --> 00:26:32,200 Speaker 1: why would I not buy? Are you seeing other buying 496 00:26:32,320 --> 00:26:38,040 Speaker 1: activity from US investors? You know, the data looks like 497 00:26:38,160 --> 00:26:42,239 Speaker 1: that you're seeing selling from US investors. I mean, and 498 00:26:42,320 --> 00:26:44,840 Speaker 1: we're in a massive risk off day, so it's not 499 00:26:44,880 --> 00:26:47,840 Speaker 1: it's not just China, it's e m um, you know, 500 00:26:47,920 --> 00:26:52,359 Speaker 1: and anything that's beta is down. I think the important 501 00:26:52,359 --> 00:26:56,600 Speaker 1: disparity is what we're seeing from data from what mainland 502 00:26:56,600 --> 00:26:59,960 Speaker 1: investors are doing. They're buying mainland Chinese equities, they're actual 503 00:27:00,160 --> 00:27:04,000 Speaker 1: buying Hong Kong stocks um, and I just think China's 504 00:27:04,040 --> 00:27:09,680 Speaker 1: maybe a little bit more forward along in this unfortunate epidemic. Um. 505 00:27:09,720 --> 00:27:13,720 Speaker 1: But in aggregate, you know this this, these numbers are 506 00:27:13,880 --> 00:27:16,520 Speaker 1: very very low. I mean my guess is more people 507 00:27:16,520 --> 00:27:19,800 Speaker 1: were killed in car crashes over the last last twenty 508 00:27:19,840 --> 00:27:24,359 Speaker 1: four hours then Corona in you know, in aggregate. Got it? 509 00:27:24,400 --> 00:27:26,000 Speaker 1: Brennan and her and thanks so much for joining us. 510 00:27:26,000 --> 00:27:28,359 Speaker 1: Brennan's a chief investment officer for Crane Shares based in 511 00:27:28,400 --> 00:27:31,280 Speaker 1: New York City. Lots of experience investing in China. He 512 00:27:31,520 --> 00:27:34,399 Speaker 1: is buying today, buying the dip. I'm just looking at 513 00:27:34,440 --> 00:27:35,639 Speaker 1: you know, kind of one of the names that gets 514 00:27:35,720 --> 00:27:37,800 Speaker 1: bandied about us, a play on China, which is Ali Baba. 515 00:27:37,840 --> 00:27:42,280 Speaker 1: The stock is down three point two today. This is Bloomberg. 516 00:27:42,800 --> 00:27:45,000 Speaker 1: Thanks for listening to the Bloomberg P and L podcast. 517 00:27:45,160 --> 00:27:47,760 Speaker 1: You can subscribe and listen to interviews at Apple Podcasts 518 00:27:47,840 --> 00:27:50,960 Speaker 1: or whatever podcast platform you prefer. Paul Sweeney, I'm on 519 00:27:51,000 --> 00:27:53,440 Speaker 1: Twitter at pt Sweeney and Lisa A. Bram Woy. It's 520 00:27:53,440 --> 00:27:56,480 Speaker 1: I'm on Twitter at Lisa Bramwoit's one before the podcast. 521 00:27:56,480 --> 00:28:01,680 Speaker 1: You can always catch us worldwide on Bloomberg Radio.