Speaker 1: This is Bloomberg Business Week. I'm Karl Masser and I'm
Speaker 1: Bloomberg Quick Takes Tim Stanovk. We're here every day bringing
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Speaker 1: YouTube search Bloomberg clovel News shutting down again. I do
Speaker 1: feel like that's our theme right now. More companies and
Speaker 1: even cities telling workers in an individuals to stay home
Speaker 1: city group we mentioned telling staffers here in the New
Speaker 1: York City metro area to work from home again through
Speaker 1: the holidays if they can. Starting the recent rise in
Speaker 1: COVID nineteen cases in the region, and then we saw
Speaker 1: what I think, almost half of workers in the city
Speaker 1: of London not going to the office on Monday. What
Speaker 1: does it mean for for here? Well? In New York City.
Speaker 1: The Health Commissioner said that COVID nineteen data show a
Speaker 1: quote alarming trend and predicted a further increase in the
Speaker 1: case curve. Yeah, it's it's just kind of where we are.
Speaker 1: That's the snapshot. Hey, let's get some thoughts on the
Speaker 1: current headlines and where we are as well. Ruth Aaden
Speaker 1: is a founder of the Johns Hopkins Berman Institute of Bioethics,
Speaker 1: Professor of Biomedical Ethics at Johns Hopkins Bloomberg School of
Speaker 1: Public Health, which is supported by Michael R. Bloomberg, Founder,
Speaker 1: Bloomberg LP, and Bloomberg Philanthropies. She joins us on this
Speaker 1: Thursday from Martha's vineyard. Um, Dr Payden, nice to have
Speaker 1: you here back with us. How are you? I'm buying
Speaker 1: Carol and nice to be with you and Kim again.
Speaker 1: So you do look at what's going on the pandemic,
Speaker 1: um through an you know, ethics or bioethics lens. Having
Speaker 1: said that, Um, what does that say to you right
Speaker 1: now in terms of rolling out the vaccine? Where we
Speaker 1: are in the pandemic seeing you know, another rise in cases? Yes? Well,
Speaker 1: what it takes to me? I think three chief things.
Speaker 1: The first is that we should not panic. We have
Speaker 1: the tools in the toolbox and we know what to do.
Speaker 1: So from the stample in each of these individuals, it's
Speaker 1: the same message, the same message to the same message,
Speaker 1: and get vaccinated, encourage other people to be vaccinated, get
Speaker 1: boosters if you're eligible and live in the United States,
Speaker 1: be more broadly eligible, and wear masks and indoor spaces
Speaker 1: whether they're required or not. So that's the messaging. Now,
Speaker 1: that's number one. Number two, remember that we are concerned
Speaker 1: not about everyone equally, but about some people, especially so
Speaker 1: for those of us who are under sixty five, who
Speaker 1: are otherwise healthy, who's been fully vaccinated. This, especially if
Speaker 1: we get our boosters, this should not be a particularly
Speaker 1: difficult way. But but for people who don't hit that description,
Speaker 1: this is not a nothing and we've been talking about
Speaker 1: how it produces mild disease, but it probably produces so spectrum.
Speaker 1: We're just adar to be. We're older Americans and people
Speaker 1: at high risk an ethics matter, Get vascinated and protect
Speaker 1: yourself again around higher risk people. What's interesting because yesterday
Speaker 1: Drew Armstrong, senior editor for US Healthcare here at Bloomberg News,
Speaker 1: had the big take talking about hospitals in Kentucky that
Speaker 1: I have been under strained in the idea that when
Speaker 1: a hospital does go under strain, that other people are affected,
Speaker 1: even if they are irrespective of COVID. Right, if you
Speaker 1: have a car accident, you can't get care. So that's
Speaker 1: from an ethical perspective too, So we've been thinking a
Speaker 1: lot about that. What about from the perspective of the
Speaker 1: United States having access to boosters when many people around
Speaker 1: the world don't even have access to that first shot?
Speaker 1: And I got a lot of flak when I when
Speaker 1: I sat on Twitter that I was that I was
Speaker 1: boosted because somebody who listens to the show a lot
Speaker 1: got in touch and and essentially tweeted at me and said,
Speaker 1: how did it feel to get a booster when people
Speaker 1: are in the world haven't gotten their first shot? What
Speaker 1: are the ethics all right? So, Tim, that feels awful.
Speaker 1: So when answer to the person who went back at you,
Speaker 1: of course it feels awful. And I have for a
Speaker 1: long time been in the camp saying we need to
Speaker 1: concentrate on making sure that we have an equitable global
Speaker 1: distribution of vaccine, and we are so far from that
Speaker 1: it isn't even funny. We are now in a kind
Speaker 1: of ethics tragedy of our own making. If we had
Speaker 1: been more committed to global equity from the beginning, we
Speaker 1: would not be in the terrible situation of being faced
Speaker 1: with a strain that really does appear to require a
Speaker 1: third dose to get back to the kinds of protection
Speaker 1: we have had previously, when, as it's just rightly said,
Speaker 1: there are large plots of the world's population who have
Speaker 1: the ac their first dose. This is an unconscionable situation. Yeah,
Speaker 1: I feel like there's no easy answer, no right answer, um,
Speaker 1: or maybe no wrong. I don't know. I just I
Speaker 1: think most people would say right, if you can get it.
Speaker 1: I mean I felt that way in the early on
Speaker 1: getting the booster. I wasn't I was able to get it,
Speaker 1: but I've felt like I wasn't the most vulnerable, and
Speaker 1: so I backed off and canceled an appointment, and then
Speaker 1: you know, a couple of weeks later, it was like,
Speaker 1: go get it if you can. And so I think
Speaker 1: we're all finding our way through it, um, and we
Speaker 1: know the arguments about getting political. Uh, what's your visibility
Speaker 1: about maybe where we are six months from now, I'm curious.
Speaker 1: It does feel like we're better than where we were
Speaker 1: one year ago. I'm unclear about where we will be
Speaker 1: one year from now. Um, how do you see it? All? Right?
Speaker 1: Don't we say two things social on the point you
Speaker 1: just raised, it all from the from the standpoint of
Speaker 1: some individual ethics. Right now, it just is the fact
Speaker 1: that vaccine that is being offered as muster doses to
Speaker 1: Americans will not be sent to people outside of this country, right,
Speaker 1: they will not, Right, So go ahead and get your
Speaker 1: booster shot. At the same time, advocate advocate advocate well,
Speaker 1: greater involvement, greater investment on the part of our government
Speaker 1: in meeting the goal of global equity. So do both.
Speaker 1: That's on that first point. Anybody who tells you where
Speaker 1: we are going to be six months from now, good
Speaker 1: luck to them, my cology. Your second point, But there
Speaker 1: are some sitelines. I mean, with all humidity, humility, I mean,
Speaker 1: like everybody be humble here, right right. I listened a
Speaker 1: lot and work a lot with colleagueses, wh show and
Speaker 1: US policy levels. With any luck, with any luck, we
Speaker 1: will be in a much better situation which respect to
Speaker 1: global vaccine and supply by first and second quarters of
Speaker 1: two fingers crossed. Dr Ruth Faden have a safe and
Speaker 1: happy holiday season, founder of the Bourbon Institute of Bioethics
Speaker 1: at the Johns Hopkins Bloomberg School of Public Health. You're
Speaker 1: listening to Bloomberg Business Week with Carol Messer and Bloomberg
Speaker 1: Quick Takes Tim Stinovic on Bloomberg Radio. Remember Tim, we
Speaker 1: talked about this story this week about how colleges are
Speaker 1: embracing a post pandemic future that increasingly does not include
Speaker 1: those standardized tests like the S A T. Yeah, where
Speaker 1: was this twenty years ago? That's what I'm wondering. Oh, yeah, really,
Speaker 1: we'll do like guys, anyway, let's get to it. Um,
Speaker 1: she's got this story. More Bloomberg News Higher Education finance
Speaker 1: reporter Janet Lauren on the phone in New York City. Janet,
Speaker 1: good to have you here. So our S A T
Speaker 1: standardized testing, I mean, are we looking at a world
Speaker 1: where they may just go away completely? Well, we've been
Speaker 1: seeing announcements in the last couple of months that, um,
Speaker 1: you know, are continuing these trends of S A T optional. Uh.
Speaker 1: It started, of course during the pandemic when kids could
Speaker 1: not get to test centers to take the test. UM
Speaker 1: Stanford announced the last month that current juniors wouldn't have
Speaker 1: to submit them. And also some of the some of
Speaker 1: the optional um requirements have gone to sophomores like Columbia
Speaker 1: and Cornell, and Amer said current sophomores don't have to
Speaker 1: submit them. And also several graduate schools are saying, you know,
Speaker 1: you don't have to submit testing as well. So, you know,
Speaker 1: once you've had these optional requirements for years and years
Speaker 1: and years in the University of Chicago has been test
Speaker 1: options kind of hard to go back for these schools.
Speaker 1: And really the biggest influence is the University of California
Speaker 1: system with in those three hundred thousand students and if
Speaker 1: a large number of kids who live in California not
Speaker 1: taking them, you know, how do you say, well, just
Speaker 1: for us take the test? Huh? Well, okay, So what
Speaker 1: does this mean for how college is sort? And I
Speaker 1: think of the sorting hat and Harry Potter, because that's
Speaker 1: not something that these colleges have, right, you don't find
Speaker 1: out where you're going. And one way that colleges did
Speaker 1: that traditionally was through different metrics, including standardized tests. So
Speaker 1: what are they doing now, especially you sees that are
Speaker 1: you know, with so many applicants. Right, Well, they've always
Speaker 1: used said they've always said grades are going to be
Speaker 1: the most important. So they want to see what you've
Speaker 1: done in your classes, How have you performed? Are you
Speaker 1: taking the most rigorous and um, you know, some schools
Speaker 1: have been sa T optional for a very long time,
Speaker 1: like Bowden College in Maine has been sa T optional
Speaker 1: for over fifty years. Um, there's a lot of other
Speaker 1: ways to look at an applicant. Um, if you want
Speaker 1: a test proxy, you could still take some AP test,
Speaker 1: which I'm sure the college board would would like because
Speaker 1: the exactly Um, however, UM, you know it'll be interesting.
Speaker 1: You know, how are school is going to look at
Speaker 1: you know, how how are kids using their time? Because
Speaker 1: now suddenly if they're not studying for these tests, things
Speaker 1: have a lot more time. And we um, we had
Speaker 1: a young woman in our story saying, you know, she
Speaker 1: took it. She did, Okay, it wasn't worth it to
Speaker 1: admit it, so she you know, she took more hours
Speaker 1: in her job scooping ice creams. I think colleges will
Speaker 1: be interested to see what kids do with all this
Speaker 1: extra time and you know they still have to get
Speaker 1: good grades. I thought, Um, the last line in the
Speaker 1: story was very instructive from the dean of admissions at
Speaker 1: the University of Chicagogan, which hasn't required them for years.
Speaker 1: You know, it's you know, by not submitting a test score, um,
Speaker 1: you know, you can't hide your grades. And if you
Speaker 1: have a lot of seeds that's not you know, that
Speaker 1: doesn't give you a proxy for thinking you're going to
Speaker 1: get into one of those pots. Janet, is it is
Speaker 1: it optional? Is it optional? Or is it don't submit it?
Speaker 1: Because I do wonder about when it's optional and if
Speaker 1: somebody does submit it, does it give them potentially an edge?
Speaker 1: And just got about thirty seconds. I think if your
Speaker 1: grades are are very strong and your test score is
Speaker 1: very strong, it's not really telling the schools anything different,
Speaker 1: all right. It's an interesting trend, right, It's one of
Speaker 1: those things that's certainly to coming out of the pandemic
Speaker 1: that has been a much more active and aggressive conversation
Speaker 1: than before. Jannet Lauren, get to hear your voice. I
Speaker 1: ran into her up on the link yesterday. It was
Speaker 1: so nice to see her. Next time we'll get her
Speaker 1: in the studio. Yeah, exactly, Jennet Lauren, Higher Education, Financial
Speaker 1: port up Bloomberg News on the phone from New York City.
Speaker 1: By the time Lag goes to college, I welcome this
Speaker 1: to That's all I'm saying. It will be the we'll
Speaker 1: think about all the stress, the sorting hat, the sorting hat. Yeah,
Speaker 1: he'll be picked by a robot to go to robots
Speaker 1: school to learn how to program robots fingerprint and somehow
Speaker 1: they'll know exactly, like the perfect fit form exactly retinal
Speaker 1: retinal like stan something weird. Look, I think that you know,
Speaker 1: this is a source of anxiety for so many people,
Speaker 1: and they're also like all the all the big studies
Speaker 1: about bias, right, you know, who can afford to actually
Speaker 1: prep for these things? But as you and I said, okay,
Speaker 1: so what if it's more important the essay wealth Your
Speaker 1: kids can maybe afford somebody to help them write it.
Speaker 1: It's just a weird process. Great, This is Bloomberg. This
Speaker 1: is Bloomberg Business Week with Carol Messer and Bloomberg Quick Takes.
Speaker 1: Tim Stinovic on Bloomberg Radio. How many times have you
Speaker 1: talked to this dude today? This is my third time,
Speaker 1: that's only going to be my second. I mean I
Speaker 1: could go all day with Mike Reagan. I agree, I agree,
Speaker 1: all right, folks. The cover story of business Week magazine,
Speaker 1: it's a takeover the finance section, actually really taking over,
Speaker 1: uh this particular coverage. It's a detail look at a
Speaker 1: year that's our market headlines dominated by retail traders, meme stocks,
Speaker 1: cryptocurrency SPACs. It was crazy writing about it for Bloomberg
Speaker 1: business Week. Is Mike Reagan, senior editor for Bloomberg Markets.
Speaker 1: He's with us in the Bloomberg Interactive Broker Studio. Mike
Speaker 1: story is the cover of the brand new issue of
Speaker 1: Bloomberg business Week magazine. I just got my hands on it.
Speaker 1: You can get your hands on it at newsstands and
Speaker 1: online at Bloomberg dot com, slash business Week. That this
Speaker 1: is great because it's so overarching, and if we think
Speaker 1: about where we were in the rise of the retail trader,
Speaker 1: meme stocks, n f T s, crypto Milania, Trump just
Speaker 1: coming out with an n f T earlier today, we
Speaker 1: were just talking about it. How are we going to
Speaker 1: look back on this year? Yeah, definitely a crazy er.
Speaker 1: I mean, I think what's really interesting is just this
Speaker 1: confluence of events that you know, we've never seen before
Speaker 1: in history. Knock on would we never see again, but
Speaker 1: you know, sort of the seeds being planted. I think
Speaker 1: even before the virus, you know that this move to
Speaker 1: commission free trading, for example, I think is something I
Speaker 1: didn't get into detailing in the story, but I think
Speaker 1: it's part of it. And sort crypto reaching its adolescence,
Speaker 1: and all this happening right at a time where suddenly
Speaker 1: we all found ourselves locked at home, um with some
Speaker 1: extra money, you know, whether it be from the government
Speaker 1: stimulus payments, just from not being able to to go
Speaker 1: out and spend it on other things, and you know,
Speaker 1: everyone kind of turned to their computer screens for I think,
Speaker 1: you know, not only entertainment, but also the sense of community,
Speaker 1: the sense of you know, the need to interact with
Speaker 1: other people, and people stumbled into these social media rabbit holes,
Speaker 1: whether it be Wall Street bets on Reddit or you know,
Speaker 1: the the discord chats where all the crypto people hang out,
Speaker 1: UM to Twitter and even you know, just text messages
Speaker 1: among friends. And you know, I talk about the notion
Speaker 1: of identity investing, the notion that you know, these communities
Speaker 1: are formed and people sort of gravitate to them, and
Speaker 1: suddenly you have a new fundamental driver of of asset prices.
Speaker 1: I think, you know, it's not necessarily the cash flow
Speaker 1: that the company's spinning off that is the important driver
Speaker 1: of the stock. It's doesn't have a community of people
Speaker 1: that have invested interest in it UM that's even goes
Speaker 1: beyond their investments. You know, I clearly I think game
Speaker 1: Stop comes from people who were gamers, who shopped at
Speaker 1: that store as a kid, AMC movie lovers, and then
Speaker 1: cryptic just poking the bear which is known as traditional
Speaker 1: Wall Street just say, absolutely, it's pretty remarkable how it
Speaker 1: really caught a lot of traditional investors, you know or
Speaker 1: big you know, institutional firms off. God. Absolutely, and then
Speaker 1: you know this kind of this overarching sense that the
Speaker 1: market was this plaything of the big money institutions and
Speaker 1: hedge funds and kind of very much a rebellion of that.
Speaker 1: And that's a theme that goes through both the you know,
Speaker 1: the crypto boom. I think it is similar, you know,
Speaker 1: people trying to sort of recreate a new financial system
Speaker 1: outside of the traditional system UM and for some of
Speaker 1: the meme stock traders trying to really knock out, uh,
Speaker 1: some of the big players in it who were short
Speaker 1: these stocks. So you use the term identity investing, what
Speaker 1: does that mean? It kind of means, you know what
Speaker 1: I'm talking about with these communities, that you you have
Speaker 1: sort of an affinity to an investment um based on
Speaker 1: you know, whether it be you're an old video game
Speaker 1: player who shot the game Stop as a kid, or
Speaker 1: or someone who just got a laugh out of dogecoin
Speaker 1: and Sheba, you know, you know the knockoff of dogecoin.
Speaker 1: Carol's laughing because knockoff of dogecoin, right, it's a joke
Speaker 1: of a joke, right, right, and you know it's easy
Speaker 1: to roll your eyes and laugh at it, but it
Speaker 1: really happened. And I think it's you know, it's something
Speaker 1: in a way. I feel like, you know, the horses
Speaker 1: out of the barn now on this type of activity,
Speaker 1: and you know, it's hard to believe we'll see another
Speaker 1: year's wild, but I think that you know, you have
Speaker 1: to sort of take this trend seriously. Well, let's talk
Speaker 1: about that, because if the if the horses out of
Speaker 1: the barn, and perhaps we won't see another year as
Speaker 1: wild as we saw in one. For a handful of factors,
Speaker 1: what do we see in two? Because commission free trading
Speaker 1: unless something happens payment for order flow that's not going anywhere.
Speaker 1: That's not that's not going anywhere. So there's certainly there
Speaker 1: will always be the ingredients the recipe in place. I
Speaker 1: think what will be different about this upcoming years? We
Speaker 1: people had these swollen savings accounts. Um. You know, even
Speaker 1: if you were unemployed and you collected unemployment, you were
Speaker 1: getting more than a lot more than you would have
Speaker 1: otherwise a lot of people getting more than what they
Speaker 1: made at their jobs. So you know, it almost I
Speaker 1: think for a lot of people felt like betting with
Speaker 1: house money. Right. It didn't feel like you're really putting
Speaker 1: your own savings at risk because this was sort of
Speaker 1: surplus newfound cash. So I think that pile of money,
Speaker 1: that excess savings is going to get drawn down in
Speaker 1: a couple of ways, you know, either deflation of these
Speaker 1: asset prices as one or just people spending it out. Well,
Speaker 1: that's point I said to you earlier when we were
Speaker 1: taping for our weekend show, this this story in there. Um,
Speaker 1: I love your last line. You know, remember the reality
Speaker 1: maybe virtual the money you're investing eight and it's it's
Speaker 1: one thing when everything's going up and it can feel
Speaker 1: like wow, I'm really onto something. But let's remember something
Speaker 1: like cryptocurrencies, bitcoin, you know, these things are really volatile.
Speaker 1: They are and you know, and you don't even really
Speaker 1: have to tell crypto investor that they're glue. They have
Speaker 1: their their quota and they understand it, and it's it's
Speaker 1: part of the I think, appeal of it. If you
Speaker 1: wake up on a Saturday morning and ethereum or bitcoin
Speaker 1: is down, it's you know, all of a sudden you
Speaker 1: have a chance to get it at a discount. But
Speaker 1: you're right that, you know, if the tide you know,
Speaker 1: to use the famous word buffet thing, if the tide
Speaker 1: goes out permanently um, it certainly could be come as
Speaker 1: a surprise to many investors. I do think a lot
Speaker 1: of this is people's not necessarily their main nest eggs,
Speaker 1: their retirement money. It's kind of, you know, a smaller
Speaker 1: budget that they have set aside for you know, I
Speaker 1: can talk talk about it like lottery ticket money. You know, what,
Speaker 1: what's your budget for lottery tickets? And I think for
Speaker 1: some people it's that granted, a bigger budget on lottery
Speaker 1: tickets than you probably want, want, or should have, But
Speaker 1: you say it's changed investing forever. So what's the lasting
Speaker 1: part of this? I think it's these communities and this
Speaker 1: this herd behavior. You know, I always think back to
Speaker 1: the old investing clubs. You know, you get a bunch
Speaker 1: of little ladies in a room together and have tea
Speaker 1: and you all and they'd all invest the same way.
Speaker 1: Peter right right, This is that times a gazillion, I think,
Speaker 1: And I think that's what's here to stay. Is this
Speaker 1: this herd tribal uh investing that we've seen. And you know,
Speaker 1: you don't have to join a tribe permanently. You could
Speaker 1: be in the dose coin tribe one day and then
Speaker 1: go back to the games Stop tribe. And I think,
Speaker 1: you know, there's gonna be a lot of sort of
Speaker 1: chasing the next where the next crowd is going, okay
Speaker 1: before we let you go just in forty seconds. N
Speaker 1: f T s here to stay, I think absolutely, And
Speaker 1: I think but not in the way we think of them.
Speaker 1: I don't think it's just gonna be j PEG's. I
Speaker 1: think they're there. There's a lot more potential and sophisticated
Speaker 1: smart contracts as they call it um going forward, and
Speaker 1: n f T s are are sort of the you know,
Speaker 1: the poster child for that. It's not buying Milan's eyes. Well,
Speaker 1: you think of these word ape yacht clubs. You know,
Speaker 1: it's a it's a picture of a funny ape. But
Speaker 1: there's more to it than that. You you get a
Speaker 1: member ship in this online community. So if this metaverse
Speaker 1: thing really takes off, um, I think there's gonna be
Speaker 1: more to it than just the pictures are buying. Well,
Speaker 1: you know, with Bloomberg's restrictions, I without it for good
Speaker 1: or bad. That's a policy that's good all of us
Speaker 1: from a lot of a lot of foolish moves. It's
Speaker 1: great coverage in the magazine. Check it out the cover story.
Speaker 1: There's moving, different moving parts to it, but a great story.
Speaker 1: Mike Rere again, Senior editor, Bloomberg Markets in our interactive
Speaker 1: broker's story. Uh that new issue on newstands, online at
Speaker 1: business week dot com and of course always on the
Speaker 1: Bloomberg terminal. You're listening to Bloomberg Business Week with Carol
Speaker 1: Messer and Bloomberg Quick Takes. Tim Stinovic on Bloomberg Radio.
Speaker 1: This is among I believe you're most right on the
Speaker 1: Bloomberg It is indeed, in fact, it is the number
Speaker 1: one most read story in the past eight hours on
Speaker 1: the Bloomberg. Doesn't seem like corporate Americas on a path
Speaker 1: toward normalcy. A new wave of COVID uncertainty upending business
Speaker 1: plans from Wall Street to Silicon Valley. We've seen a
Speaker 1: plan out in real time. Especially, I feel like in
Speaker 1: the lasts we have Jenny Serina's finance reporter for Bloomberg
Speaker 1: new she's with us in the Bloomberg Interactive Broker Studio.
Speaker 1: I mean, I hope you're with us for a while,
Speaker 1: and like we don't have to all go and work
Speaker 1: different places because wherever. Well, look, we were joking and
Speaker 1: not really even joking, but we were talking during the
Speaker 1: break that this really feels like, you know, it feels
Speaker 1: like yesterday, yesterday with the cancelation of the JP Morgan conference,
Speaker 1: the health conference right that to me, it feels like
Speaker 1: it's set off some sort of wave where we're just
Speaker 1: seeing banks say and companies say, okay, work from home,
Speaker 1: we're canceling holiday parties. Was that some sort of turning
Speaker 1: point and give us bring us up to speed on
Speaker 1: what's happened since then? Yeah, I think it definitely felt
Speaker 1: like that was one of the many kind of cracks
Speaker 1: in the industry's efforts to keep offices restocked through the holidays. Um.
Speaker 1: So yeah, I think banks are in a different position
Speaker 1: than a lot of other companies because they were pretty
Speaker 1: aggressive and bringing folks back, So that means they've had
Speaker 1: folks there these past few weeks. People came back from
Speaker 1: the Thanksgiving holiday. Cases have shot up across the street,
Speaker 1: and now everyone's pretty much saying, Okay, you guys can
Speaker 1: work from home. Um, you know, stay safe, enjoy your holidays.
Speaker 1: So that's kind of the state of plan banking. I
Speaker 1: think Tech they haven't actually brought their people back yet,
Speaker 1: so their big Dave is just once again delaying a
Speaker 1: return to office. And I think we're seeing over there
Speaker 1: a lot of those folks are just saying, you know what,
Speaker 1: we're sick of setting a date just and definitely you're
Speaker 1: working from home and we'll figure it out when things
Speaker 1: It was summer January through the dates out the window. Yes. Yeah.
Speaker 1: And then someone was saying it feels like groundhog Day,
Speaker 1: and it definitely does. Um, it definitely feels like we're
Speaker 1: just kind of going through the same motions over and
Speaker 1: over again. But what's the psyche that's going on? I
Speaker 1: think within the Wall Street community. And I do wonder
Speaker 1: about the significance of Jamie Diamond coming out and doing something.
Speaker 1: He really is looked too as a barometer in terms
Speaker 1: of what can we do, what's okay to do? I
Speaker 1: feel like I mean, and so Diamond has been probably
Speaker 1: the most vocal about the importance of offices and how
Speaker 1: much you it's those, um, you know, folks be back
Speaker 1: and bankers on the road and people meeting with clients
Speaker 1: and and so that was a big turning point. Um.
Speaker 1: But I think honestly it's almost you know, he had
Speaker 1: companies pulling out left and right, So I don't know
Speaker 1: that he had that much of a choice in the end. Um.
Speaker 1: But it's definitely a disappointment I think for all these
Speaker 1: CEOs who just feel really strongly that FaceTime is the
Speaker 1: way forward. UM. But I also think, you know, it's
Speaker 1: it's a very odd discord because I think a lot
Speaker 1: of folks are still doing kind of what they want
Speaker 1: to in their normal lives. You know, people are going
Speaker 1: on to dinners, um. Broadway is still happening, lots of
Speaker 1: different cultural stuff, football stadiums are full, like the whole
Speaker 1: nine yards, and then in the office you just have
Speaker 1: this very different, um, you know, approach. It's interesting the
Speaker 1: conversations we have in and around, certainly the news room
Speaker 1: and I know certainly in my personal life, of of
Speaker 1: people saying I keep hearing people are like, I'm tired
Speaker 1: of commuting. I'm happy to work, I will do whatever
Speaker 1: I need to, but I'm tired. Like the pandemic showed me,
Speaker 1: I could work at a lot of stuff done still
Speaker 1: do everything by I had a little bit more balanced.
Speaker 1: And I do wonder if whether it's the Wall Street
Speaker 1: community or CEO's overall, are just kind of missing a
Speaker 1: really big message that's going on and maybe not want
Speaker 1: to be, especially in a tight labor force. Yeah. I
Speaker 1: think that's definitely right, and I think, you know, the
Speaker 1: tech people probably feel it a little bit more acutely,
Speaker 1: just because those folks, I mean so many engineers and
Speaker 1: data scientists really can do it all from home, right. UM.
Speaker 1: I think in Wall Street a lot of times you
Speaker 1: think about those like the investment bankers, the folks that
Speaker 1: get on the plane and pitch CEOs on big deals,
Speaker 1: and it's a very um I mean, it's a very
Speaker 1: FaceTime friendly industry, and so I think it's just an
Speaker 1: adjustment period and we'll see if you know, Wall Street
Speaker 1: comes around to the UH the new way of working,
Speaker 1: or if Wall Street kind of forces its way forward
Speaker 1: and says we're tired of you resisting. You need to listen.
Speaker 1: We're talking about Wall Street, We're talking about the big banks.
Speaker 1: But as you write in your peace, Jenny, this goes
Speaker 1: beyond the big banks. I mean, think about what the
Speaker 1: headlines we've seen from colleges where a high proportion of
Speaker 1: students are vaccinated. You did right that Hans Vestberg, the
Speaker 1: CEO of Verizon, just closed yesterday that he tested positive
Speaker 1: recently for the virus. He's been quarantine at home with
Speaker 1: mild symptoms. What does it all mean post holidays for
Speaker 1: especially when it comes to the banks, Do they get
Speaker 1: people back there? I think, I mean, if we learned
Speaker 1: anything from post Thanksgiving holiday, as soon as folks got
Speaker 1: back a few weeks in, we've seen a real rising
Speaker 1: cases across the street, and so I think that is
Speaker 1: going to probably stay with these banks for a while.
Speaker 1: I mean, nobody likes to do the contact tracing and
Speaker 1: inform their employee. It scares people. So I think, you know,
Speaker 1: I think they'll probably take it slow in January, um
Speaker 1: and we'll probably start to heal feel that same kind
Speaker 1: of drumbeat, like let's get back in, let's get back
Speaker 1: to work, you know, come February or maybe later in
Speaker 1: the month in January. But I think for now everything
Speaker 1: is pretty much on its back foot and kind of
Speaker 1: realizing the situation that we're in and having said that,
Speaker 1: you know, we do know how this plays out. We
Speaker 1: know what happens in cases spike, and so we also
Speaker 1: know how to quickly kind of clamp down on it.
Speaker 1: And it is I feel like a little bit refreshing
Speaker 1: for these CEOs to say, Okay, let's just let's just
Speaker 1: shut it down. We know what to do here. Yeah.
Speaker 1: I mean, I think that it helps that this time
Speaker 1: they know that there's a playbook that they know people
Speaker 1: can do it. It's not like March and that sense
Speaker 1: where they're kind of sending folks often to the ether
Speaker 1: with no idea what was going to happen. You know,
Speaker 1: everyone's pretty adapted at moving to the whole work from
Speaker 1: home set up Brown hog Day all over again, or
Speaker 1: Deja Vu all over again a little bit of that. Um, Jenny,
Speaker 1: thank you so much. And I've been really busy some
Speaker 1: great reporting all over the place from you when it
Speaker 1: comes to all things Wall Street. Jenny Serene, Finance reporter
Speaker 1: at Bloomberg News in our Interactive Broker studio. But this
Speaker 1: really does feel like her story, and just the headline
Speaker 1: after headline of shutdowns rolling back is our big story
Speaker 1: it is. I'm curious to see what happens after the holidays.
Speaker 1: As I mentioned, the anecdotal data that I see with
Speaker 1: people just lined up outside of urgent care facilities to
Speaker 1: get tested. Right now, we've all seen it if you
Speaker 1: live in New York City. To what extent are those
Speaker 1: people being tested so they can travel and be with
Speaker 1: family during the holidays or are they feeling symptoms? We
Speaker 1: don't know. We do know that the curve though here
Speaker 1: in New York City is rising. Um and Health Commissioner
Speaker 1: is not happy about it. And what happens with schools
Speaker 1: and especially kids that are in grade school, middle school,
Speaker 1: younger if they start to shut down the impact of that. Now,
Speaker 1: but you let me drive, Oh no, no, no, no,
Speaker 1: this is all right, Please, I'll go. I want to drive.
Speaker 1: It's a good question. Good drive. This is the Drive
Speaker 1: to the Globe on Bluebird Radio. Alright, just got about
Speaker 1: ten minutes left into today's trading session. We are getting
Speaker 1: ready to wrap up the Thursday trade. A very different
Speaker 1: tone from what we saw posts that fed decision yesterday.
Speaker 1: We are bouncing off our loads of the session, but
Speaker 1: big tech tech in particular. If I take a look
Speaker 1: at the NASAC, it is down about two point six percent,
Speaker 1: down three hundred ninety three points in today's session. So
Speaker 1: if you're looking for where investors are kind of running
Speaker 1: for the exit, it is certainly among those big tech.
Speaker 1: Having said that big tech, still, if you want to
Speaker 1: look at out performance for the year one, it's big tech. Yeah,
Speaker 1: it really is. But if you look at the NASTAC
Speaker 1: on Carol thirty, only thirty of the one stocks in
Speaker 1: the n S actually in the green. Let's talk about
Speaker 1: this in more with Gary Black, portfolio manager at Future
Speaker 1: Fund Active E TF. He joins us on the phone
Speaker 1: from Chicago. Gary, how are you great? Thanks for having
Speaker 1: me join you. Well, let's talk a little bit about
Speaker 1: about tech and big tech today. Um, what was the
Speaker 1: big change between yesterday and today when we saw tech
Speaker 1: rally after we heard from Fed church er own Powell
Speaker 1: versus today, what changed. Well, I think you're seeing a
Speaker 1: little bit that the market is suddenly worrying about a
Speaker 1: Fed policy mistake because you know, you see, obviously you heard,
Speaker 1: you know, the tapering will be accelerated. People are starting
Speaker 1: to think, okay, that there's gonna be three interest rate
Speaker 1: hikes next year. Um. But then when you look at
Speaker 1: the tenure treasury, you know, um tenure treasury is continuing
Speaker 1: to follow the yield, so you got the yield down
Speaker 1: to one four three. So while the Fed is saying, look,
Speaker 1: we're gonna take three hikes next year, at least the
Speaker 1: dot plot implies are gonna take three hikes next year,
Speaker 1: three hikes in three And you know that, as they
Speaker 1: call it, the so called term will, it'll be about
Speaker 1: too one. The tenure isn't moving up the ten years
Speaker 1: at one fourth thrace. So the bond market is I guess,
Speaker 1: you know, a little skeptical of that. So then you
Speaker 1: think about technology. Usually when rates go down, um, you know,
Speaker 1: longer duration assets such as technology, technology get hurt. But
Speaker 1: I don't think it's that so much as people are saying, well,
Speaker 1: maybe there's a mistake on the horizon, they're um, you
Speaker 1: know forward, Well, if you start moving rates up, let's
Speaker 1: suppose that you know, the tapering is not a big deal.
Speaker 1: That's just qui qui is going to continue it. You know,
Speaker 1: it'll be sixty billion next month and thirty billion the
Speaker 1: following month and it will disappear March. So it's just
Speaker 1: you know, no more funds being added to the system,
Speaker 1: and that's q E. And you're seeing the ECB announced
Speaker 1: the same thing that they're tapering wind in March. But
Speaker 1: if rates start moving up, which is what you saw
Speaker 1: last night, the Bank of England surprisingly raised it's it's
Speaker 1: you know, minor amount fifteen BIPs to forty BIPs. If
Speaker 1: you start seeing raids move up three times next year,
Speaker 1: you know there's always a risk that the FED is
Speaker 1: tightening while demand um is starting to fall. And you know,
Speaker 1: the big wild card here is COVID and if COVID
Speaker 1: you know, continues to spread and and and you know
Speaker 1: close and this is a big worry, um cancelations of shows,
Speaker 1: restaurant closings, UM, school closings, and then you're going to
Speaker 1: see a hit to GDP, which is what you saw
Speaker 1: back last March, you know, two thousand twenty when COVID hits,
Speaker 1: So you could have the same time as growth slowing dramatically,
Speaker 1: you could have the FED tightening. Now. I don't worry
Speaker 1: too much about that because I think the Fed is smart.
Speaker 1: J Pal you know, in the past, has has talked
Speaker 1: about transitory inflation, and we can get in you know,
Speaker 1: whether inflation is transit or not. You have to define
Speaker 1: what's transitory. But I do believe that if you see
Speaker 1: COVID continue to um, you know, be more rampant, and
Speaker 1: if you see economic roaths start to slow, um, they'll
Speaker 1: they'll quickly reverse course if they have to. It's great,
Speaker 1: that's what you're seeing. To the markets afraid of this
Speaker 1: our New Economy Daily on newsletter that came out this morning,
Speaker 1: and they set a big threat the Lady economist Rudiger
Speaker 1: jorn Bush once saying that the most that most US
Speaker 1: expansions are murdered by the Federal Reserve. I mean it's
Speaker 1: a policy misstep. Having said that, you've got a fun
Speaker 1: you've got the future fun active ETF. I think it's
Speaker 1: off about seven percent since its inception. I guess it
Speaker 1: began trading late August August this year. Now as that
Speaker 1: one hundred up about four percent in the same time frame,
Speaker 1: you are still though deciding whether to add positions or
Speaker 1: sell positions. What have you done in this environment? What
Speaker 1: changes have you made to that portfolio? And your top
Speaker 1: holdings include names like Tesla, Alphabet tenst and Harley Davidson
Speaker 1: correct and so you know the stuff that is getting hurt.
Speaker 1: Uh and as market it takes something like Tesla. You know,
Speaker 1: it's it's what we call longer duration equity. You know,
Speaker 1: most of the cash flows come towards the end. You know,
Speaker 1: they make money, but you know as the growth accelerates
Speaker 1: over the next three or four years, where they really
Speaker 1: start making my where the value is is more in
Speaker 1: the you know, five or six years out um. And
Speaker 1: so those longer duration assets as people worry about inflation,
Speaker 1: as interest rates rise and then they were talking about
Speaker 1: the ten year treasury. If the tenure treasury starts rising,
Speaker 1: you're to see the longer duration assets get hurt. And
Speaker 1: so you know, names like a Tesla are not going
Speaker 1: to do well in theory in that environment. So do
Speaker 1: you sell? Do you buy into that more? It's down
Speaker 1: Since early November, you've been buying yes. And the reason
Speaker 1: is because there's nothing, no change of fundamentals. When you
Speaker 1: look at earnings revisions, which is you know it's the
Speaker 1: it's the Cell Sides estimates of volumes and earnings forward,
Speaker 1: they've actually gone up. The only reason Tesla is down
Speaker 1: twenty only reason is because Elon Musk. Because you know,
Speaker 1: he's in a very convoluted way. He's been selling shares
Speaker 1: and when you know, you when when normally want a
Speaker 1: CEO cells, let's call it two percent of the the flow,
Speaker 1: which is what he wants selling. You know, they would
Speaker 1: just call up Goldmen or Morgan Stanley and they would say,
Speaker 1: do a secondary and let's get it done. It would
Speaker 1: be a three or four percent haircut. Here he's been
Speaker 1: selling shares now for six weeks. And you know, if
Speaker 1: you're a long only portfolio manager or if you you
Speaker 1: know you want to add to the position, you're gonna
Speaker 1: wait until after the selling is done to do that.
Speaker 1: So this is a very different situation. And I think,
Speaker 1: you know, like something like Google, which is not down
Speaker 1: that much. Google is you know, very cheap stock relative
Speaker 1: to its growth. Um, you know it's going to do
Speaker 1: fine in its firement. But but Tesla will do fine
Speaker 1: once Elon stops selling. Okay, let's go from from teslata Google.
Speaker 1: What you just mentioned six so far this year, it's
Speaker 1: been an incredible run. Um are you adding to your
Speaker 1: position right now? And you still you said it's actually
Speaker 1: still a good value. How do you see it? We've
Speaker 1: we've added to Google. It's about nine percent of the portfolio.
Speaker 1: Test is about ten UM. You know, YouTube is on fire.
Speaker 1: YouTube is about twelve percent of the revenue ad AD
Speaker 1: revenue we have UM next few years growing about a
Speaker 1: year for YouTube. You know, their basic search business is
Speaker 1: about sixty of the business UM. That's still even though
Speaker 1: it's a cash it's growing in about fifteen percent a year.
Speaker 1: And it fits with one of the big measured friends.
Speaker 1: And we can talk about our fund the way it works,
Speaker 1: but we try to exploit about ten mega friends that
Speaker 1: we see out changing the world. And the social media
Speaker 1: replaced in traditional media is one of those trends. UM
Speaker 1: search spending about fift The cloud is another business. It's
Speaker 1: a little bit less than ten percent of the revenue
Speaker 1: that's growing the year. And the other thing about Google
Speaker 1: is it's gonna be if if the metaverse actually ever
Speaker 1: you know it takes hold, it will be a big
Speaker 1: beneficiary of the metaverse. So um, you get all that
Speaker 1: for about twenty six times twenty two earnings. That's very cheap.
Speaker 1: Um the average called Russell all cap coats stock do
Speaker 1: we look at trades about thirty eight times, so it's cheaper.
Speaker 1: But yet it's growing its revenue seventeen eighteen percent a year.
Speaker 1: It's growing it's earnings here, so from a like price
Speaker 1: earnings to growth basis, it's a very cheap stock the
Speaker 1: way we look at it. All right, well, listen, great
Speaker 1: to spend some time with you, Gary. Thank you so
Speaker 1: much of a good and safe holiday season. Gary Black,
Speaker 1: He's portfolio manager of the Future Fun Active e TF,
Speaker 1: joining us on the phone from Chicago. Thanks for listening
Speaker 1: to Bloomberg Business Week. Download the podcast on iTunes, SoundCloud,
Speaker 1: or Bloomberg dot com. And you can also listen to
Speaker 1: our radio show at two pm Eastern on Bloomberg Radio
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