Speaker 1: Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keane. Along
Speaker 1: with Jonathan Ferrell and Lisa A. Brawmowitz. Daily we bring
Speaker 1: you insight from the best and economics, finance, investment, and
Speaker 1: international relations. Find Bloomberg Surveillance on Apple Podcast, Suncloud, Bloomberg
Speaker 1: dot com, and of course on the Bloomberg terminal. Let's
Speaker 1: get right to it right now. Michael Wilson, without question,
Speaker 1: the top strategists we have observed for last year, Chief
Speaker 1: US equity Strategy, Morgan Stanley. Mike, I want to go
Speaker 1: to technique here. Do you change your technique your day
Speaker 1: to day grind at Morgan Stanley and the classic ideas?
Speaker 1: Are you bottom up? Top down? All this? There's the
Speaker 1: factor analysis out of m I t years ago. What
Speaker 1: is the process of Wilson strategy for this year? We
Speaker 1: good morningtime and happy new year to all of you.
Speaker 1: I mean the process never changes. Okay, we do all
Speaker 1: of those things you mentioned, top down, bottoms of factor analysis. However,
Speaker 1: what I would say is and at certain times we
Speaker 1: emphasize you one over the other. And I would say that,
Speaker 1: you know, going into two thousands twenty three is probably
Speaker 1: gonna be a little bit more bobs up, a little bit,
Speaker 1: more dispersion amongst stocks, even even perhaps within sectors. There's
Speaker 1: doing a lot of work on that this week actually
Speaker 1: for next week's note with respect to okay, well, how
Speaker 1: are we going to make money on a relative value basis?
Speaker 1: And that started to emerge again a little bit at
Speaker 1: the end of last year because at the end of
Speaker 1: these bear market is what happens is the big cahunas, right,
Speaker 1: the big market cap leaders are the ones that eventually
Speaker 1: have to fall, and that's exactly what we're seeing this
Speaker 1: year at the end of last year. So we think
Speaker 1: there is going to be opportunity to stock level and
Speaker 1: we've been talking about that center. Where's the greatest variability
Speaker 1: to partial differential on the income statement? Is revenue the
Speaker 1: greater mystery? Or do you go down to ibata or
Speaker 1: down to net income? Now that's a great question, Tom.
Speaker 1: It's it's all about profitability. And we've been talking about
Speaker 1: this one factor really since January February. Operational efficiency. That's
Speaker 1: what the market is paying for, and it continues to
Speaker 1: pay up for companies that can basically deliver to the
Speaker 1: bottom line. All right, So revenue growth, we know is
Speaker 1: going to be softer than last year. We don't know
Speaker 1: if it's gonna be negative, because that ties into the
Speaker 1: question around recession, which you all are just debating. I
Speaker 1: think being a bond investor is harder than being a
Speaker 1: stock investor right now because being a bond investor, you
Speaker 1: don't know if you're gonna get a labor cycle. Okay,
Speaker 1: but in the acquity market, we don't. We don't really
Speaker 1: care because if you don't get a labor cycle, then
Speaker 1: the margins are gonna be even worse. So I think
Speaker 1: either way, we're gonna get a nasty earnings recession. And
Speaker 1: so the companies that can deliver on the cost efficiency
Speaker 1: are the ones that are going to continue to perform
Speaker 1: until you fully price you know, whatever this downturn on
Speaker 1: earnings are going to be. So, Michael, were starting to
Speaker 1: see that cuts those cuts of much in big tech
Speaker 1: and does that make you a little bit more constructive
Speaker 1: on the sector into twenty three, Well not yet. I
Speaker 1: mean we're starting to see it. I think the you know,
Speaker 1: the look, this is one of the areas I would
Speaker 1: say consume consumer goods in particular and tech were the
Speaker 1: two areas of most egregious over earning and margins as
Speaker 1: well as top line, and that just has to get
Speaker 1: wrung out. The thing the concerns about tech companies, John,
Speaker 1: is that they're not good cost cutters. Traditionally right there,
Speaker 1: their growth companies, they tend to want to invest into
Speaker 1: these downturns. They want to invest, you know, aggressively through
Speaker 1: all periods of time. And they're just not good at
Speaker 1: cost cutting, and so they're gonna be late on that.
Speaker 1: They're probably not going to do enough, and so it
Speaker 1: will take longer than you think, and so the margin
Speaker 1: degradation could be more severe in those areas. Now, there
Speaker 1: are parts of tech that have already gone through that.
Speaker 1: The other thing I would say is be careful about
Speaker 1: how you define tech, where if you look at the
Speaker 1: top six or seven stocks in the SMP, we all
Speaker 1: know what they are. Only two of them are real
Speaker 1: tech companies. The other ones are communication services and consumer retail. Mike,
Speaker 1: how has the potential reopening of China changed your view?
Speaker 1: Because you've been talking about the potential for an earnings
Speaker 1: downturn for a while now, and a lot has changed
Speaker 1: the past couple of weeks with respect to China, with
Speaker 1: respect to a warmer an expected winter, you know, I
Speaker 1: mean like it. It factors into our analysis for sure.
Speaker 1: From an economic standpoint. I think from an earning standpoint,
Speaker 1: it's less important at leasta because you know, we look
Speaker 1: at it carefully. China only accounts for about four percent
Speaker 1: of SMP revenue, so it's just not that significant. Now
Speaker 1: for some companies it's very significant. The other thing I
Speaker 1: would caution on is that, you know, China really hasn't
Speaker 1: been closed to a production standpoint, right, I mean, we
Speaker 1: haven't wanted for many things. We mean, we've they've been
Speaker 1: produced to be doing these rolling lockdowns, and the factories
Speaker 1: have been pretty wide opened quite frankly. So this is
Speaker 1: more about consumption at the at the at the domestic level.
Speaker 1: So thing it's a real positive for the Chinese stock
Speaker 1: market and certain pockets of that. That's where we upgraded
Speaker 1: China a few months ago. But I'm not sure it's
Speaker 1: a big deal for the US stock market. But what
Speaker 1: about with consumer spending? We've seen that hang in there,
Speaker 1: that's come out better than expected at least over the
Speaker 1: past a number of weeks in select industries. Does that
Speaker 1: make you change your view at all? Or is that
Speaker 1: basically U. What's to be expected in the last gasps
Speaker 1: for the downturn that we see in the first quarter. Yeah,
Speaker 1: I mean, unfortunately, I think we're just seeing the last
Speaker 1: gaps as you mentioned. I mean, part of that has
Speaker 1: holiday spen, okay, so you know, it's the American way.
Speaker 1: We don't want to be scrooge. People are gonna spend
Speaker 1: money on the holidays, and I think they're gonna probably
Speaker 1: hunker down. We've heard something's large consumer retailers talk about
Speaker 1: that dynamic where they expect demand to fall off sharply
Speaker 1: once the holiday season is over. So that's what we're
Speaker 1: gonna be watching carefully. We're pretty confident about interest rate
Speaker 1: sensitive areas like housing and autos. Those are pretty obvious,
Speaker 1: you know, victims of the higher rates. But I think
Speaker 1: even broader speaking, we're expecting a pretty sharp down turning
Speaker 1: consumption over the first six months of this year, at
Speaker 1: least as a stand as a stands in turns a
Speaker 1: profitable spending Okay, Discounting will return as one of our
Speaker 1: teams for this year, which is why we think inflation
Speaker 1: will come down pretty sharply. So Mike, with that in mind,
Speaker 1: during the team still believe it's about down side at
Speaker 1: the index level. Here we do we think, we think
Speaker 1: three thousand is is a very achievable number given our
Speaker 1: confidence on our orange forecast and so and that you know,
Speaker 1: I would ironically, I would say, in the absence of,
Speaker 1: you know, a recession, meaning companies decide to not off aggressively,
Speaker 1: that target looks more achievable. That may sound counterintuitive, but
Speaker 1: that's the way we're not modeling it today. So our
Speaker 1: bear case is actually kind of we avoid a recession,
Speaker 1: but not the slowdown that would be the three thousand
Speaker 1: scenario and a d dollars and earniers. My my quote
Speaker 1: from last year was from the Great not seem to
Speaker 1: Leb who said the gravity is back, the idea that
Speaker 1: money costs something the risk free rates there. To me,
Speaker 1: my theme for the year is the great zombie roll up.
Speaker 1: Not the companies Morgan Stanley follows, but all the garbage
Speaker 1: companies out there that had a fifteen sixteen year free ride.
Speaker 1: What happens to them in two thousand twenty three. Well,
Speaker 1: I think it's already begun. I mean, we've seen what's
Speaker 1: going on right When the cost of Capitola goes up,
Speaker 1: these business is flat out don't work. Um. And so
Speaker 1: we've had fifteen years of easy monetary policy globally. UM
Speaker 1: that that is now being normalized in a more rapid
Speaker 1: way than anybody expected, including us quite frankly, even though
Speaker 1: we had that forew a year ago. And that's just
Speaker 1: gonna run ramshot over these business models. And by the way, time,
Speaker 1: I'm not sure it's a bad thing if we can
Speaker 1: do it in a way that isn't too destructive, okay
Speaker 1: to the broader economy. And we need we need a
Speaker 1: normalization of the cost of capital because it's not healthy
Speaker 1: for the broader economy. It's not healthy for five companies
Speaker 1: to account for the market cap, which is what happened
Speaker 1: in the last ten years. We need a more democratic
Speaker 1: economy where you know, medium small sized businesses have a
Speaker 1: fighting chance and it costs to capital arizing. Ironically, it's
Speaker 1: part of that. It's a nazing discipline. Makes the count
Speaker 1: back Mike wonderful as Old White Buddy happen New Year's
Speaker 1: even it's saying looking forward to plenty of contrees straight
Speaker 1: three wis there? Stanley Jordan Ryansester a huge value of
Speaker 1: Bloomberg surveillance last year and he started stronging this year
Speaker 1: with us as well. Jordan, I'm gonna cut to the chase.
Speaker 1: The first thing I looked at it was a d
Speaker 1: x y the Pacific rim. But I want to bring
Speaker 1: it over to your inside on Euro as well. Is
Speaker 1: the week dollar trend intact led by strong euro. Well yesterday,
Speaker 1: Tom and happy New Year everybody. It was a pretty
Speaker 1: tough day for that year long. We saw a big
Speaker 1: move over one percent, much bigger than a normal January move.
Speaker 1: For your own facts, it's been similar to the entire
Speaker 1: monthly move of of euro in January and previous years.
Speaker 1: It just tells you that volateerity was alive last year
Speaker 1: and it's still live in the first few train days
Speaker 1: of this year. Low liquidity, people dusting off their holiday
Speaker 1: emails and also putting fresh capital to work. And as
Speaker 1: you mentioned, there was that negative seasonality, so a sixty
Speaker 1: four percent hit ratio. Since night, euro dollar has headed
Speaker 1: lower on average around point three. So we're currently betting
Speaker 1: on the thirty six historical chance that Euro goes higher
Speaker 1: for a number of reasons. The first one was proven today,
Speaker 1: which is I think the European growth data it's going
Speaker 1: to point towards recession, but it's not gonna be as
Speaker 1: bad as what people think. We had. The p M
Speaker 1: eyes revised up this morning for the Euro Area, and
Speaker 1: I think the reopening in China will really help boost
Speaker 1: the Euro Area economy as well as as as we're
Speaker 1: also seeing gas prices, natural gas electricity prices much lower
Speaker 1: with the warmer weather. The ski season has been awful,
Speaker 1: but that's been fantastic for industry looking at much lower
Speaker 1: levels of input costs and therefore boosting production. So we're
Speaker 1: having a growth story. And then yesterday it was the
Speaker 1: weird one. We had the North rest wine um German numbers.
Speaker 1: That's that signaled that German CPI would coming week. We've
Speaker 1: now had the French numbers suggesting the same. So we
Speaker 1: get euro inflation later this week. It's going to be
Speaker 1: weak than what was previously thought. That kind of means
Speaker 1: the ECB super hawkish in December that did boost euros slightly.
Speaker 1: Perhaps they won't need to be as hawkish as what was.
Speaker 1: What the market thinks this year is the message from
Speaker 1: the inflation data just one data point and the growth
Speaker 1: numbers might offset that. But there's there's two factors going
Speaker 1: on here. Growth up inflation down that revises at your
Speaker 1: real GDP estimate for your area in some respects, and
Speaker 1: therefore I think euro can stay supported in January. How
Speaker 1: much does your one tent target at the end of
Speaker 1: January hint on the weather? Well, the weather is already
Speaker 1: baked in so October, November, and we had that cold
Speaker 1: snap in December, but now we're back into a warm snap.
Speaker 1: So we've already got the story of Germany having having blackouts.
Speaker 1: That's kind of gone to the side, so it's unlikely
Speaker 1: that will run out of gas next winter could be
Speaker 1: a bigger problem. But what we have seen is that
Speaker 1: Germany has just switched to coal burning um and so
Speaker 1: that has really allowed for the gas story to weaken
Speaker 1: as a problem for euro So yes, if some amazing
Speaker 1: blizzard came came along, that could be a factor for industry,
Speaker 1: but I just don't I don't see it in the
Speaker 1: forecast right now. You're where's the ECB fit into this call.
Speaker 1: It's been a tough one to use an ECB view
Speaker 1: and put that directly onto euro It's been quite frivolous. Actually,
Speaker 1: if you kept doing that last year, because we're trading
Speaker 1: a stagflation story when it comes to framework for Foreign
Speaker 1: Exchange so e c B, yes, they'll be hawkish. That
Speaker 1: will boost European yields. We're already seeing portfolio inflows into
Speaker 1: European government bonds for the first time a long time,
Speaker 1: so that's going to boost euro I think on the
Speaker 1: ECB side, by raising rates, that's going to not growth though,
Speaker 1: So those two forces offset each other properly. I guess John,
Speaker 1: we could bring it all back to the FED. If
Speaker 1: the Fed pauses as we think they will, and if
Speaker 1: they look to cut rates later this year, which we
Speaker 1: think they will as well, that'll keep your dollar supported
Speaker 1: no matter what the ECB do. You can't see the
Speaker 1: side of radio. Is he wearing an Estivilla tie? Just?
Speaker 1: I actually think he might be. I think it might be.
Speaker 1: I think it's an Estiville unlikely guys, Yeah, that's right. Wow,
Speaker 1: he actually is with the team emblement as well. It's
Speaker 1: just why am I wearing a tie? John? Can you
Speaker 1: remind us all? Will you tell me? I watched the
Speaker 1: highlights of the Todds aston Villa game. Is aston Ville
Speaker 1: that good? Or is Tottenham that bad? Jordan's helped me
Speaker 1: make sure that too. It's been one of the worst
Speaker 1: runs for Tottenham in the league since you conceded more
Speaker 1: than two goals in each game for seven games in
Speaker 1: a row. That hasn't been done since for Villa. We've
Speaker 1: got a new manager and things look to be on
Speaker 1: the app. We've had a good start. We should do
Speaker 1: a podcast with Jordan's we should we should just never
Speaker 1: mind phone exchange. Yeah, I like it, Jordaan Rochester, thank
Speaker 1: you for tomorrow. You're briefing today on oil and call
Speaker 1: emreada soon, joins US Director Research Energy aspects. Of course,
Speaker 1: they're looking at all of the different hydrocarbons, including the
Speaker 1: grizzly call. I'm gonna look at and reader right now
Speaker 1: in our call links into oil. Is there a substitution
Speaker 1: effect if Germany uses call, if China uses call to
Speaker 1: that just brent crude price? No, no, tom thankfully, not that,
Speaker 1: but yet another variable. Of course, it impacts gas hugely.
Speaker 1: And yeah, look when we've had gas prices surge, we
Speaker 1: have seen in Europe, for instance, cooled usage go up
Speaker 1: a lot, and at the margin we've obviously seen oil
Speaker 1: usage coal up a lot as well. But no, there
Speaker 1: isn't any direct links simply because you know, oil is
Speaker 1: barely used in part generation there does c mrideson microeconomics
Speaker 1: in place for oil to surge. People talking about brand
Speaker 1: eighty Dare I say higher as well? Is that set
Speaker 1: up in place here at the beginning of the year.
Speaker 1: I'd say the beginning of the year. No, But I
Speaker 1: really do think the second half of the year, in
Speaker 1: particularly of China opens up in the way we are.
Speaker 1: You know, now we're kind of hearing headlines from them
Speaker 1: around the reopening scale. We've tended to forget what we
Speaker 1: saw in the West, right, It took us two years
Speaker 1: to get over the pent up demand in terms of
Speaker 1: airline travel, in terms of car travels or the mileage
Speaker 1: driven that we've seen. And I keep saying this, particularly
Speaker 1: for jet it's a multiplayer effect. When China reopens, other
Speaker 1: parts of the world will also you know, people from
Speaker 1: other parts of the world will also want to go
Speaker 1: to China. And China is so connected to the rest
Speaker 1: of Asia, Beat Korea, Thailand, Vietnam, Philippines, all these countries
Speaker 1: they have huge trade relationships with China. Percent tourism or
Speaker 1: just spectrochemical exports linked to China. So we are going
Speaker 1: to see some big demand numbers. The problem now, Tom,
Speaker 1: is that we've seen these big freezeoffs in the US,
Speaker 1: and that's meant that the crude balance has actually weakened.
Speaker 1: We've seen so many refineries having to forcefully shut down
Speaker 1: because of the cold. That's lost US crude demands. So
Speaker 1: that's why we are on a softer footing and it's
Speaker 1: and you know, then it kind of turns into seasonal
Speaker 1: turnaround season, so there's a few more weeks of softness.
Speaker 1: I will think, I'm gonna forgive the pun, but what's
Speaker 1: the canary in the coal mine when it comes to
Speaker 1: the reopening of China given the fact that there a
Speaker 1: whole host of different energy sources are playing the tabletime.
Speaker 1: I know it's kind of a terrible pun, but you
Speaker 1: know what source of energy? Well, we see the first
Speaker 1: pickup in demand that will represent the next phase of
Speaker 1: China's reopening and the effect and energy markets. That's a
Speaker 1: great question because, like in you guys were saying this
Speaker 1: just now as well, when China does reopen, they will
Speaker 1: need all energy products, right, It's not just going to
Speaker 1: be oil. You know, oil stocks aren't particularly high, so
Speaker 1: we should see them come out and buy crude oil probably,
Speaker 1: if not this cycle, definitely from next cycle onwards, they
Speaker 1: are going to need coal and gas as well. So
Speaker 1: I would genuinely say all three of those. I think
Speaker 1: metals you've already seen them by. If anything, I think
Speaker 1: energy or energy imports should outperform the other commodities because
Speaker 1: right now with the reopening, the focus shifts back to consumers,
Speaker 1: which is kind of again goes directly into energy consumption
Speaker 1: as opposed to metals, which was more infrastructure driven. That
Speaker 1: happened last year. Some people push back and they say,
Speaker 1: we'll trying to spent the past couple of years stackpiling,
Speaker 1: crewe starckpiling energy sources, and they're not going to need
Speaker 1: an access in supplies even if they do reopen in full,
Speaker 1: at least not for a very long time. Do you
Speaker 1: have any sense and radar of how significant those stack
Speaker 1: piles of energy sources are in China? Absolutely, Look, wee
Speaker 1: track stock bars in China to our best ability on
Speaker 1: a daily basis, and I think this is a big misnomeral.
Speaker 1: Let's talk about oil. For instance, China's oil stocks have
Speaker 1: been rising, for sure, but over the course of last year,
Speaker 1: they've been drawing down stocks on a consistent basis. China
Speaker 1: was importing barely nine million barrels per day instead of
Speaker 1: eleven million barrels per day, So that stockpiling took place
Speaker 1: in one, not last year. We've de stocked enough in
Speaker 1: China for them to be at a heart the level
Speaker 1: that they require for their days of cover, where now
Speaker 1: as they reopen they do need to buy again. I've
Speaker 1: got Emery Emoryson, I've got lergy moving here moving there.
Speaker 1: Have you a blast of bloomberg out with analysis of
Speaker 1: lergy in Japan today as well? Just a simple question,
Speaker 1: with all your expertise, is the United States energy independent?
Speaker 1: It's definitely more independent than it used to be. Look,
Speaker 1: the U still imports some oil um and simply that's
Speaker 1: to do with the location the ability of certain refiners
Speaker 1: to run certain crudes. But yes, I mean it's exporting
Speaker 1: natural gas now. It does export well over three million
Speaker 1: barrels a day of crude right now. There's still global linkages. Right.
Speaker 1: So that's where I don't like to use the word independence,
Speaker 1: because Brent crude is still the biggest driver off the
Speaker 1: gasoline that you are buying at the pump, right So
Speaker 1: it's not an island and Therefore, yes, it's independent in
Speaker 1: the sense that it's exporting a lot more products. It's
Speaker 1: still a net importer of certain products. But at this
Speaker 1: end of the day, the global linkages haven't broken down
Speaker 1: just because of the way the refining system is set
Speaker 1: up just quickly and reads A best guess for why
Speaker 1: you think crew it's going to end up City at
Speaker 1: Q four twenty three has crewed at seventy six. I've
Speaker 1: got Goldman at once ten. I've got other banks with
Speaker 1: triple digits as well. Where are you at? I'd be
Speaker 1: triple digits as well, And I think again people are
Speaker 1: underestimating China's reopening and the multiplier effect on demand. Again
Speaker 1: basic one on one economics that it's going to have
Speaker 1: on the world economy. Yes, bad news for inflation, but
Speaker 1: it is definitely something to watch out for. I'm really
Speaker 1: saying thank you ad energy aspects with another triple digit
Speaker 1: crude code term for year end. We get further perspective
Speaker 1: from Greg Villier, chief US policy strategist at A G F. Gregg.
Speaker 1: I randomly looked at the twenty names of these Congress
Speaker 1: people against Mr McCarthy, I guess against a lot of
Speaker 1: what we would call political normality. One of the congress people,
Speaker 1: the gentleman from I believe the ninth District Georgia, called
Speaker 1: the capital attack of January quote no insurrection quote a
Speaker 1: normal tourist visit is. Butch Cassidy said, who are these guys? Yeah,
Speaker 1: you're right time. You know, I've been doing this for
Speaker 1: a long time, and I have never seen anything as
Speaker 1: crazy as this story, with a handful of extreme members
Speaker 1: of the House to denying the Republicans control of the House.
Speaker 1: And this could go on for a long long time.
Speaker 1: Mr Trump says it should not go along for a
Speaker 1: long time. John read his truth like the social media thing.
Speaker 1: Close the deal, take the victory, said the President. Could
Speaker 1: that be enough to sway them today? It might. There's
Speaker 1: talk to a lot of Republicans are going to Sean
Speaker 1: Hannity and going to uh, you know, other conservative commentators
Speaker 1: to see if they can dissuade these rebels. I'm not
Speaker 1: sure it's gonna work. I think this drags on for weeks.
Speaker 1: What about the voters, I mean, is there a sense
Speaker 1: that this is what people want? That's sort of just
Speaker 1: you know, break things up or destroy the status quo,
Speaker 1: starts something new is that basically the voters will behind
Speaker 1: some of these representatives. Not really, I mean it's a
Speaker 1: self inflicted wound by the Republicans. I don't think the
Speaker 1: voters would be pleased to see this kind of dysfunction,
Speaker 1: you know, for the markets right now, at least, I
Speaker 1: don't sense that this is the biggest story. There are
Speaker 1: biggest stories, as you know, and the Fed things like that.
Speaker 1: But if this drags well into the spring, people are
Speaker 1: going to start worrying about the death ceiling, about a
Speaker 1: credit crunch, about some sort of default of the US budget.
Speaker 1: If this drags on, I think it will start to
Speaker 1: become an irritant for the markets. So Greg, let's stay there.
Speaker 1: Because I've been talking about this this morning and my
Speaker 1: co hosts have thought that I was being a bit histrionic.
Speaker 1: How serious could it get? What are the sort of
Speaker 1: parallels here between what we're seeing with the Republican Congress.
Speaker 1: They're laughing at me and two thousand and eleven we
Speaker 1: did see a debt default. We are not debt default,
Speaker 1: but we did see the downgrade and the debt ceiling
Speaker 1: debate really go to the last minute. Well, most of
Speaker 1: these dis censers who don't like McCarthy want this to happen.
Speaker 1: They would like to see a debt crisis. So that's
Speaker 1: that's something you've got to be concerned about. You know.
Speaker 1: Another important point is that let's say Kevin McCarthy does
Speaker 1: whip four or five or six House members in the
Speaker 1: next two years, could scuttle everything that they have him
Speaker 1: on such a short leash that on a lot of
Speaker 1: these issues they can still prevail. We hold on a second, Greg,
Speaker 1: why do they want to see a debt ceiling scuttle? Oh?
Speaker 1: Because it will curb spending. I mean they feel that
Speaker 1: is the only way you can get discipline on spending.
Speaker 1: They're furious at Mitch McConnell, who's going with Joe Biden
Speaker 1: today to a new bridge construction spending a lot of money. Uh,
Speaker 1: there's huge divisions over spending money, and some Republicans a minority.
Speaker 1: I granted, I wouldn't mind seeing a debt defall credit crisis,
Speaker 1: which I think is crazy. Greg. The historical moment, it
Speaker 1: goes back to a H two. Oh, it goes back
Speaker 1: to the Democrat lustermatics and on and on. I don't
Speaker 1: want to do a history lesson here, but the reality
Speaker 1: is there's ramifications to this behavior. Does it make centrist
Speaker 1: Democrats stronger? Absolutely? And it weakens the Republicans. I mean,
Speaker 1: there are some pretty decent whatever your politics were. Paul
Speaker 1: Ryan was a quality house speaker. John Baynard was a
Speaker 1: quality house speaker. They their careers were scuttled by a minority,
Speaker 1: a tiny minority of radicals who didn't want to compromise
Speaker 1: in the least that of HF investments on the nights
Speaker 1: to stand in Washington day sake, Greg, Thank you, Seth.
Speaker 1: This is the Bloomberg Surveillance Podcast. Thanks for listening. Join
Speaker 1: us live weekdays from seven to ten am Eastern on
Speaker 1: Bloomberg Radio and on Bloomberg Television each day from six
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Speaker 1: the terminal. I'm Tom Keene and this is Bloomberg