WEBVTT - Forces Transforming the Markets 0:00:01.280 --> 0:00:05.640 This is Bloomberg business Week Inside from the reporters and 0:00:05.840 --> 0:00:09.400 editors who bring you America's most trusted business magazine, plus 0:00:09.480 --> 0:00:13.640 global business, finance and tech news. The Bloomberg Business Week 0:00:13.680 --> 0:00:18.600 Podcast with Carol Masser and Tim Stenebec from Bloomberg Radio. 0:00:20.160 --> 0:00:22.040 Our next guest currently works with some of the largest 0:00:22.079 --> 0:00:24.720 financial institutions and hedge funds on Wall Street. His team 0:00:24.760 --> 0:00:27.400 reminds us that in the past he's correctly predicted the 0:00:27.400 --> 0:00:29.800 stock market rise under the Trump administration, as well as 0:00:29.840 --> 0:00:32.720 a recent rise in inflation. Julian Brigden is co founder 0:00:32.720 --> 0:00:35.720 and president of Macro Intelligence, two partners here to talk 0:00:35.720 --> 0:00:38.720 about some of the structural factors that are transforming the markets. 0:00:39.080 --> 0:00:41.960 He is here in studio, so nice to have you 0:00:42.000 --> 0:00:44.320 here with us. Welcome, thanks for having me. When you 0:00:44.320 --> 0:00:48.840 think about structural factors, what exactly are you talking about? So, 0:00:49.080 --> 0:00:52.440 I think when we look at things this year, we're 0:00:52.479 --> 0:00:55.560 pretty certain there's a recession comming. There's no question into 0:00:55.560 --> 0:00:57.600 our mind. The question is just how deep a recession 0:00:57.720 --> 0:01:01.760 does it really matter to the value of the equity market, 0:01:02.160 --> 0:01:05.919 not necessarily within the sectors. Yes, I think to be honest, 0:01:05.959 --> 0:01:09.000 what sets the value of us equities is liquidity. It's 0:01:09.120 --> 0:01:11.759 really the FED. I hate to say, it's a sort 0:01:11.800 --> 0:01:14.600 of Wymy Republic esque kind of world where you where's 0:01:14.640 --> 0:01:17.320 Matt Miller. He's listening as you always does. Love Matt, 0:01:17.319 --> 0:01:19.560 that was for you. But anyway, print enough money and 0:01:19.720 --> 0:01:23.200 assets rise in price, right, I think it does don't 0:01:23.200 --> 0:01:26.040 matter what goes on in the economy and how much 0:01:26.080 --> 0:01:29.200 money we print for where you allocate that money. So 0:01:29.520 --> 0:01:31.720 when we look at structural factors, I think potentially so 0:01:31.840 --> 0:01:33.760 is that the assumption and the FED that will be 0:01:33.800 --> 0:01:36.120 cutting rates later on this year, And well, I think 0:01:36.160 --> 0:01:38.120 they will. I think. Look, I'm very much in the 0:01:38.160 --> 0:01:39.920 camp that we're in the higher for longer at least 0:01:39.920 --> 0:01:42.679 that's what they want to be able to do. Right, 0:01:43.800 --> 0:01:45.720 There's really only sort of two ways that you address 0:01:45.760 --> 0:01:48.160 inflation of this sort of magnitude. You do what was 0:01:48.200 --> 0:01:51.160 referred to as deliberate disinflation, which was Volka, you kind 0:01:51.160 --> 0:01:54.000 of kill the economy dead. Or you do what they 0:01:54.000 --> 0:01:57.080 refer to as opportunistic disinflation, which was kind of Greenspan 0:01:57.160 --> 0:01:59.440 in the mid nineties, and you hold rates are much 0:01:59.480 --> 0:02:01.760 longer than people expect, and you kind of hope that 0:02:01.800 --> 0:02:04.720 the economy doesn't die. If it does, sorry, but you 0:02:04.800 --> 0:02:08.760 kind of choke it out slowly, but that could take years, right, 0:02:08.800 --> 0:02:12.040 I mean conceptually, I think the problem that they've got 0:02:12.720 --> 0:02:15.280 and why I suspect they'll end up cutting, is that 0:02:15.320 --> 0:02:19.160 this credit crunch is going to be much deeper potentially 0:02:19.240 --> 0:02:22.799 than they think. I already are working. Watch those banks. 0:02:22.800 --> 0:02:25.639 Watch yeah, watch those banks. And I think one thing 0:02:25.680 --> 0:02:29.240 I was just listening to the previous conversation. I think 0:02:29.240 --> 0:02:32.760 it's very interesting. So the assumption is that the FED 0:02:32.800 --> 0:02:37.200 goes twenty five in May, but right they will have 0:02:37.360 --> 0:02:42.720 the Senior Loan Officers survey going into the meeting, and 0:02:42.880 --> 0:02:46.160 if they do not cut, to me, that's a big 0:02:46.200 --> 0:02:49.640 tell to me. That tells them there's something very bad 0:02:49.680 --> 0:02:51.919 in that survey. And there's some preliminary stuff we've had 0:02:51.960 --> 0:02:55.760 the Dallas fedor if they do not, if they do, sorry, 0:02:55.760 --> 0:02:58.920 if they do not hike, my apologies. So if they 0:02:58.960 --> 0:03:00.679 do not hike, I think that would be a tell 0:03:00.720 --> 0:03:03.440 that that survey is going to be showing material timing. 0:03:03.560 --> 0:03:06.200 But they're getting a lot of evidence. I feel like 0:03:06.240 --> 0:03:09.320 over the past couple of days at least that there's 0:03:09.320 --> 0:03:11.960 some sophename. We had the jobs report, we had the 0:03:12.040 --> 0:03:15.440 Dallas fed exactly as you said, is there becoming a 0:03:15.480 --> 0:03:18.840 little bit more of a case for a pause the 0:03:18.880 --> 0:03:22.400 next I think that they're done to all intensive purposes. 0:03:22.400 --> 0:03:24.520 It's sort of academic whether they're going under twenty five 0:03:24.600 --> 0:03:26.800 or not. Only I mean, I think, I think really 0:03:26.840 --> 0:03:32.519 when we wrote a three part series, yeah, exactly, sure, Yeah, 0:03:32.639 --> 0:03:36.200 who cares because the damage has been done. Yeah. I 0:03:36.240 --> 0:03:38.840 do agree with you that what we hear from banks 0:03:39.080 --> 0:03:42.600 will tell us exactly what's going on and whether or 0:03:42.640 --> 0:03:45.640 not they are just shutting things down or there's no 0:03:45.720 --> 0:03:48.720 interest right in loans and activity, right. And I think 0:03:48.720 --> 0:03:50.760 it's it's not the big boys, it's not JP Morgan, 0:03:51.120 --> 0:03:53.920 It's going to be the smaller names. There was a 0:03:53.960 --> 0:03:56.920 story running around today on one of the other outlets. 0:03:57.280 --> 0:04:00.320 They're interviewed the CEO of a medium sized bank. He said, 0:04:00.520 --> 0:04:02.600 I kind of went into this year thinking I should 0:04:02.600 --> 0:04:05.520 cut my lending fifty percent. Right, I think I need 0:04:05.560 --> 0:04:10.119 to cut it another fifty percent. Wow, that's big. It's 0:04:10.800 --> 0:04:13.080 look this is but we already you have to add 0:04:13.080 --> 0:04:15.840 on this. We were facing an inventory overhang, right because 0:04:15.840 --> 0:04:19.080 we all massively over ordered. Companies have been doing a 0:04:19.120 --> 0:04:24.159 great job at masking over falling volumes by raising prices. 0:04:24.400 --> 0:04:28.040 Procter and Gamble was a classic glass quarter where their 0:04:28.120 --> 0:04:30.800 volumes were down, but their profits were up because they'd 0:04:30.880 --> 0:04:34.520 raise prices sufficiently. And that's great for companies, but the 0:04:34.560 --> 0:04:38.800 real economy runs on volume. Where do we see though 0:04:38.880 --> 0:04:41.599 the start of this recession then, because just on the 0:04:41.640 --> 0:04:44.760 other side here we do have jobs numbers staying pretty good, 0:04:44.960 --> 0:04:48.840 you know GDP pretty good, Like how do we get there? 0:04:49.120 --> 0:04:52.480 So we've well, when you look talk at the jobs market, 0:04:52.560 --> 0:04:55.360 I think the important thing to think about from from 0:04:55.400 --> 0:04:58.480 employment is if you look at the unemployment rate, it 0:04:58.520 --> 0:05:01.640 looks like a mountain range right in Colorado half the time. 0:05:01.839 --> 0:05:05.720 So you get these very sharp peaks, which is so nice. 0:05:04.600 --> 0:05:12.160 Yeah yeah, So you get these very sharp peaks, peaks, drops, 0:05:12.560 --> 0:05:15.280 and then the bottom you get these kind of little valleys. 0:05:15.320 --> 0:05:18.000 But the point is a momentum game. So once you 0:05:18.160 --> 0:05:22.039 start to lose positive momentum and you start to flatten out, 0:05:22.440 --> 0:05:24.960 you can kind of start the stop watch and say, 0:05:25.240 --> 0:05:28.560 the next ticket is up, and most of our momentum 0:05:28.600 --> 0:05:33.560 indicators are beginning to show rising unemployment. I think there's 0:05:33.560 --> 0:05:37.599 one that I watch in the claims data. And with 0:05:37.680 --> 0:05:40.080 the exception nineteen eighty nine, if you take it back 0:05:40.080 --> 0:05:42.640 into the as far back as the sixties, and in 0:05:42.760 --> 0:05:44.880 eighty nine, the FED had already started easing, which clearly 0:05:44.920 --> 0:05:47.760 they're not doing now. Whenever it ticked above the level 0:05:47.839 --> 0:05:50.520 that I indicated, we were either in the recession that quarter, 0:05:50.560 --> 0:05:54.760 which would be now, or one quarter away. So I 0:05:54.839 --> 0:05:56.680 think it's kind of to your point. Whether they go 0:05:56.760 --> 0:05:59.000 another twenty five or they don't go another twenty five, 0:05:59.560 --> 0:06:02.680 who cares. We're basically at that point. I think that 0:06:02.720 --> 0:06:05.920 we're to slowdown is upon us and it will start 0:06:05.920 --> 0:06:08.479 to manifest. I'm going to say it feels it in 0:06:08.520 --> 0:06:12.040 a funny, weird, odd way. Julian. So, what is that 0:06:12.880 --> 0:06:15.440 the market indicator that you watch most closely? You're talking 0:06:15.440 --> 0:06:19.360 about this indicator within the labor market. It's one of them, right, 0:06:19.440 --> 0:06:21.040 I mean another one, a great one is if you 0:06:21.120 --> 0:06:24.200 look at is new orders. Right, So if you look 0:06:24.200 --> 0:06:28.520 at ism manufacturing new orders, Historically, unless the FED comes 0:06:28.520 --> 0:06:32.080 in and punts the cycles of these we eases, once 0:06:32.080 --> 0:06:36.120 you drop below forty seven point two, you're either in 0:06:36.160 --> 0:06:38.760 the recession or pretty close to decision. There's a number 0:06:38.760 --> 0:06:41.760 of things that I think are just out there indicating 0:06:42.440 --> 0:06:45.560 it's kind of here. But could we see a manufacturing 0:06:45.600 --> 0:06:49.360 recession but not a services recession manufacturing? Could we see 0:06:49.360 --> 0:06:52.840 a recession and the job market stop? So you could? 0:06:53.160 --> 0:06:55.680 I mean it's so you'd be kind of looking at 0:06:55.720 --> 0:06:58.320 something like two thousand and two thousand and one. We're 0:06:58.400 --> 0:07:02.440 relatively mild recession where you've got a capex recession, a 0:07:02.560 --> 0:07:06.640 credit cycle, a small rise, and unemployment. The big thing 0:07:06.680 --> 0:07:09.160 that I think that's missing from there is I think 0:07:09.200 --> 0:07:11.680 a we're going to get a tighter credit crunch than 0:07:11.680 --> 0:07:13.960 we got back then. And secondly, it does feel like 0:07:14.000 --> 0:07:16.800 there's going to be another Starting in two thousand, you've 0:07:16.800 --> 0:07:19.800 got a big uptick in the housing market, and the 0:07:19.840 --> 0:07:22.840 housing market is actually very important as a driver of 0:07:22.880 --> 0:07:25.640 the broad economy. And this time we've already done our 0:07:25.680 --> 0:07:28.600 building right. We went in from two thousand I think 0:07:28.680 --> 0:07:31.160 to two thousand and four weeks. I never get the 0:07:31.160 --> 0:07:34.960 housing market because we went from tons of building oversupply 0:07:35.120 --> 0:07:37.200 to let's blow up houses to reduce supply, and then 0:07:37.240 --> 0:07:39.200 all of a sudden, we've got a shortage again. So sorry, 0:07:39.400 --> 0:07:41.880 I don't understand it, but I get it. No, So 0:07:41.920 --> 0:07:45.040 we've since the loads of COVID, we've increased new home 0:07:45.120 --> 0:07:47.800 construction for over forty percent, right because we had to 0:07:47.840 --> 0:07:51.600 accommodate the Great migration. So there's oversupply. Now there's going 0:07:51.720 --> 0:07:53.640 it's starting to come. If you look at homes under 0:07:53.640 --> 0:07:57.880 construction versus actually what's selling, there's going to be a 0:07:57.920 --> 0:08:00.600 lot that's going to hit the market. Commercial real yes 0:08:01.080 --> 0:08:05.120 a big issue as well. I think a look, are 0:08:05.160 --> 0:08:07.200 we going to see more svbs with a sort of 0:08:07.640 --> 0:08:10.760 heart attack and these banks drop? I don't think so. 0:08:10.840 --> 0:08:14.200 I think we're just going to see ongoing decay in 0:08:14.240 --> 0:08:16.080 the system where these smaller banks are going to have 0:08:16.120 --> 0:08:21.560 to recognize losses. We've linked now losses to the equity price, 0:08:22.240 --> 0:08:24.680 and then if the equity price starts to runder, the 0:08:24.720 --> 0:08:27.400 big depositors start to take their cash out again like 0:08:27.440 --> 0:08:29.880 they did with SUBB and so I can see this 0:08:29.960 --> 0:08:34.400 sort of ongoing problem for this sector. Jilian, we just 0:08:34.480 --> 0:08:36.679 have about twenty five thirty seconds, and you do need 0:08:36.720 --> 0:08:39.360 to be quick. You do work with financial institutions, big ones, 0:08:39.400 --> 0:08:41.679 hedge funds. What's the question that they must ask you. 0:08:43.240 --> 0:08:45.480 So the big question I think at the moment is 0:08:45.520 --> 0:08:47.560 the dollar is that what they ask you about. Yes, 0:08:47.640 --> 0:08:50.080 this is this is going to be the big question. Right. 0:08:50.120 --> 0:08:53.079 The dollar has dictated everything we've done for the last decade. 0:08:53.120 --> 0:08:55.560 We've had a rising dollar, sucks money into the US 0:08:55.600 --> 0:08:59.280 equity market, leads to massive outperformance of the US versus 0:08:59.320 --> 0:09:01.960 the rest of the world world. And if the dollars 0:09:02.000 --> 0:09:05.280 starts to falter, which is overdue, it's already done a 0:09:05.280 --> 0:09:10.480 bunch since Smiden. You know, then you're saying a lot 0:09:10.520 --> 0:09:13.720 more it could. I'm watching it very, very close because 0:09:13.760 --> 0:09:17.800 that starts to turn. Then your whole investment horizon and 0:09:17.960 --> 0:09:22.640 direction changes. Super treat next time you're in town, come back, 0:09:22.840 --> 0:09:26.000 we'll do I really appreciate Julian Brigden, co founder, president 0:09:26.080 --> 0:09:29.200 Macro Intelligence, two partners right here in studio. This is Bloomberg. 0:09:31.480 --> 0:09:35.040 You're listening to the Bloomberg Business Week podcast. Catch us 0:09:35.080 --> 0:09:38.440 live weekday afternoons from three to six Eastern Listen on 0:09:38.520 --> 0:09:41.800 Bloomberg dot com, the Ihard Radio app, and the Bloomberg 0:09:41.840 --> 0:09:45.640 Business App, or watch us live on YouTube. Do you 0:09:45.720 --> 0:09:49.640 want to get to a very important story dueling abortion 0:09:49.720 --> 0:09:52.520 pill rulings. You've probably read about it, heard about it 0:09:53.040 --> 0:09:56.000 happening in both Texas and Washington State, definitely causing confusion 0:09:56.040 --> 0:09:58.640 for the federal government, for doctors, for patients, for everybody 0:09:58.640 --> 0:10:02.120 who follows this story. For really many Americans, a Texas 0:10:02.200 --> 0:10:06.600 ruling overturned FDA approval for the abortion pill mephisto. Don't 0:10:06.640 --> 0:10:11.880 say it Rightstone, mifiobristone. Yes, you said it right. I 0:10:11.960 --> 0:10:14.199 knew that was going to get caught on that mifipristone, 0:10:14.240 --> 0:10:16.640 which could block the pill nationwide. So this could be 0:10:16.760 --> 0:10:19.920 very significant. Metime, You've got a ruling in Washington State 0:10:19.920 --> 0:10:22.959 which sought to protect access to that drug. Yeah, and 0:10:23.000 --> 0:10:26.040 this afternoons and breaking news, the Biden administration seeking an 0:10:26.040 --> 0:10:30.400 emergency hold on that Texas ruling, calling it unprecedented. A 0:10:30.440 --> 0:10:32.360 lot of moving parts, a lot of news here, so 0:10:32.360 --> 0:10:34.400 we want to walk through all of it step by step. 0:10:34.720 --> 0:10:37.520 So here to discuss, We've got Bloomberg News Equality reporter 0:10:37.600 --> 0:10:40.920 Kelsey Butler. She joins us by phone in New York City, 0:10:40.960 --> 0:10:43.720 and we also have here in studio Bloomberg legal analyst 0:10:43.760 --> 0:10:46.760 and host of Bloomberg Law, June Grasso again in our 0:10:46.800 --> 0:10:50.719 Bloomberg Interactive Brokers studio. So Kelsey. For those who are 0:10:50.800 --> 0:10:54.160 not familiar with this pill. Just give us the background, 0:10:54.480 --> 0:10:58.880 what is it, what's it used for, what's the usage? Like, absolutely, 0:10:59.320 --> 0:11:02.360 miffopristown as part of a two drug regiment that is 0:11:02.400 --> 0:11:06.240 pretty much standard medication abortion care in the US. It 0:11:06.440 --> 0:11:11.160 has been available for two decades and as of twenty twenty, 0:11:11.200 --> 0:11:13.600 more than half of all terminations in the US are 0:11:13.640 --> 0:11:19.160 done via pills, and it's generally prescribed along with mesa postal. 0:11:19.600 --> 0:11:22.320 As I said, it's part of that two drug combo, 0:11:22.840 --> 0:11:26.320 and together the two pills have an over ninety five 0:11:26.400 --> 0:11:31.040 percent efficacy rate in safely ending pregnancies with no further 0:11:31.120 --> 0:11:35.400 intervention needed. And as I mentioned, now at this point, 0:11:35.559 --> 0:11:38.040 more than half of all terminations in the US are 0:11:38.120 --> 0:11:42.400 done via pills. So whatever the outcome of these cases is, 0:11:42.400 --> 0:11:46.439 it's going to have huge ramifications across the US. Kelsey, 0:11:46.480 --> 0:11:50.760 are the pills us specifically for abortions with a certain 0:11:50.920 --> 0:11:53.280 term limit at this point or is it certain weeks 0:11:53.280 --> 0:11:56.720 in the pregnancy? Yeah, so these are used in the 0:11:56.880 --> 0:12:02.040 first trimester in order to terminy pregnancies. Of course, curtical 0:12:02.040 --> 0:12:05.200 abortion is still an option for you know, those who 0:12:05.200 --> 0:12:07.880 are later in pregnancy and easier on women. I would 0:12:07.920 --> 0:12:12.719 assume the pills than a surgery. Certainly, it's much easier 0:12:13.120 --> 0:12:16.360 to access it. In the course of the pandemic, it 0:12:16.440 --> 0:12:21.160 has become available via telemedicine and mail, and so in 0:12:21.240 --> 0:12:25.040 certain states, of course, the states where you know full 0:12:25.200 --> 0:12:28.040 abortion bands aren't in effect, peasons are able to get 0:12:28.040 --> 0:12:31.679 it in a much more radically accessible manner than having 0:12:31.679 --> 0:12:34.240 to go to a clinic and have a procedure. June, 0:12:34.280 --> 0:12:36.920 come on in here, because there's a lot of moving 0:12:36.960 --> 0:12:39.960 parts on the legal side of this Texas Washington potential 0:12:39.960 --> 0:12:43.480 Scotus question. Give us the lowdown. So you have two 0:12:43.520 --> 0:12:48.680 conflicting decisions, basically conflicting decisions, although the Washington judges decision 0:12:49.200 --> 0:12:53.160 only effects according to his order the states that actually 0:12:53.200 --> 0:12:56.760 brought the case before him, So that's twelve states that 0:12:56.840 --> 0:12:59.240 brought the case before him, excuse me, seventeen states that 0:12:59.280 --> 0:13:02.640 brought the case for him. So that but the judge 0:13:02.640 --> 0:13:05.880 in Texas has a nationwide injunction. So today the Biden 0:13:05.880 --> 0:13:09.160 administration besides appealing to the Fifth Circuit, which is the 0:13:09.160 --> 0:13:12.400 most conservative circuit in the country, and that's where Texas's 0:13:13.000 --> 0:13:16.520 order will go. So besides appealing, they asked the Washington 0:13:16.679 --> 0:13:20.160 judge to clarify what his ruling would mean if the 0:13:20.160 --> 0:13:23.360 Texas judge is ruling stays in effect, because no one 0:13:23.400 --> 0:13:26.960 really knows. You have two conflicting opinions, which one has precedence, 0:13:27.880 --> 0:13:30.080 and so likely we think you'll end up at the 0:13:30.080 --> 0:13:34.480 Supreme Court. What was the Texas case, the Texas Federal judge? 0:13:34.720 --> 0:13:37.920 What was it based on? So? And by the way, 0:13:38.000 --> 0:13:40.320 this is the first time that we know of that 0:13:40.440 --> 0:13:45.040 a court has overruled the FDA's approval of a drug. 0:13:45.160 --> 0:13:48.280 That's what makes it so unique, right, And he based 0:13:48.320 --> 0:13:51.000 it on several basically, he said, And he's a judge 0:13:51.040 --> 0:13:54.840 with no medical or scientific background. He basically said, you're wrong, FDA, 0:13:54.920 --> 0:13:58.079 and I'm right. And he said things like, for example, 0:13:58.120 --> 0:14:00.400 he said that they were wrong in their process. He 0:14:00.480 --> 0:14:02.600 said that the FDA so In other words, the FDA 0:14:02.720 --> 0:14:07.120 considers pregnancy a medical condition that can sometimes be serious 0:14:07.120 --> 0:14:10.520 and life threatening. The judge called it a natural process 0:14:10.640 --> 0:14:13.840 essential to perpetuating human life. And he said the FDA 0:14:14.000 --> 0:14:18.199 failed to consider the intense psychological trauma and post traumatic 0:14:18.240 --> 0:14:21.560 stress women often experienced from chemical abortion. This is all 0:14:21.600 --> 0:14:25.400 from the plaintiffs, the anti abortion groups papers. He even 0:14:25.440 --> 0:14:30.280 adopted their language he called the fetuses unborn children or 0:14:30.440 --> 0:14:34.000 unborn humans, and he referred to abortion also as an 0:14:34.000 --> 0:14:39.240 effort to create eugenics. It's a very strange and broad opinion. 0:14:39.360 --> 0:14:41.680 This wasn't a judge who wanted to just rule in 0:14:41.760 --> 0:14:44.360 this case. This is a judge who wanted to make waves. 0:14:44.400 --> 0:14:48.760 And he's also a very conservative Christian judge who's you know, 0:14:50.000 --> 0:14:54.040 his advanced rulings against the Biding administration and LGBTQ matters 0:14:54.160 --> 0:14:57.440 and in other matters. So we expected this and really 0:14:57.520 --> 0:15:00.400 quickly if the Texas ruling were to stay, and it 0:15:00.480 --> 0:15:04.680 would ban access to this pilled nationwide, correct, nationwide? Yeah, 0:15:04.720 --> 0:15:07.480 So Kelsey bringing you back in here. If miff A 0:15:07.560 --> 0:15:10.600 press Stone is banned, there's a second part of the 0:15:10.600 --> 0:15:14.000 abortion pill series, misoprostial that you mentioned. Some doctors say 0:15:14.080 --> 0:15:16.720 that dose could be doubled and served the same purpose. 0:15:17.320 --> 0:15:20.480 Is that drug going to potentially be an alternative that 0:15:20.720 --> 0:15:23.640 is viable and can be protected legally. We've got about 0:15:23.680 --> 0:15:27.200 forty five seconds here. Or as been talking to clinics 0:15:27.280 --> 0:15:31.040 for weeks and they have been preparing as we have 0:15:31.160 --> 0:15:35.360 just been discussing. This decision was telegraphed and they know 0:15:35.760 --> 0:15:38.800 that MISA prostial is also MISA prostil only regiments are 0:15:38.840 --> 0:15:42.880 safe and effective and is an alternative should this decision 0:15:43.000 --> 0:15:45.520 from Texas stand. And I just want to say June 0:15:45.560 --> 0:15:47.400 sharing with me earlier in the day, over three hundred 0:15:47.720 --> 0:15:52.080 biotech and pharma industry executives, including Fiser's CEO, signing an 0:15:52.080 --> 0:15:55.040 open letter calling for the reversal of that district of 0:15:55.080 --> 0:15:58.720 that decision by the judge in Texas. Right, what's the likelihood, 0:15:59.480 --> 0:16:03.400 what's the strength of this case in terms of legal terms, 0:16:03.400 --> 0:16:05.320 and just kind about thirty seconds. I don't think it's 0:16:05.480 --> 0:16:07.720 I don't think it's a very strong case. It's not 0:16:07.880 --> 0:16:13.120 based it's based on his own analysis of pregnancy, and 0:16:13.560 --> 0:16:15.760 it's it's really not that the FDA didn't follow some 0:16:15.880 --> 0:16:18.440 process that that too, but it all that also relates 0:16:18.480 --> 0:16:20.880 to his analysis of pregnancy and what the FDA says. 0:16:20.880 --> 0:16:22.400 And so I think that if you know, if the 0:16:22.400 --> 0:16:25.120 Supreme Court is going to follow what it's said before 0:16:25.200 --> 0:16:27.560 and what it's said in the Jobs decision, then this 0:16:27.560 --> 0:16:29.680 would be over rule. But we never know what the 0:16:29.720 --> 0:16:34.120 Supreme Court is going to find. Yes, likely, very likely. Wow, 0:16:34.240 --> 0:16:36.360 you're living in interesting times. Um that of course, is 0:16:36.440 --> 0:16:38.880 June Grosso. She's Bloomberg News Legal and alas host of 0:16:38.920 --> 0:16:42.440 Bloomberg Law Tonight at ten PML. Wall On Radio. Kelsey Butler, 0:16:42.640 --> 0:16:45.600 quality reporter at Bloomberg News, thank you both. This is Bloomberg. 0:16:46.480 --> 0:16:50.080 You're listening to the Bloomberg Business Week podcast. Catch us 0:16:50.080 --> 0:16:54.120 live weekday afternoons from three to six Eastern on Bloomberg Radio, 0:16:54.280 --> 0:16:57.560 the Bloomberg Business app, and YouTube. You can also listen 0:16:57.680 --> 0:17:00.880 live on Amazon Alexa from our flagship New York station, 0:17:01.120 --> 0:17:05.760 jose Say Alexa playing Bloomberg eleven thirty. A lot of 0:17:05.760 --> 0:17:08.480 things on our mind on this Monday, and that includes 0:17:08.680 --> 0:17:11.840 French President Emanuel and McCallon urging Europe to develop more 0:17:12.000 --> 0:17:14.359 strategic autonomy as a way to avoid the risk of 0:17:14.400 --> 0:17:17.960 turning EU countries into vassals that's his word, in the 0:17:17.960 --> 0:17:21.160 event of a global crisis such as a US China confrontation. 0:17:22.040 --> 0:17:24.640 And this is on the heels at President mccrone's visit 0:17:24.760 --> 0:17:27.560 last week to China. So with a guidance on what 0:17:27.600 --> 0:17:29.840 this means, we are so delighted to have back with us. 0:17:29.840 --> 0:17:33.359 Andy Brown, former editorial director at Bloomberg New Economy. Andy 0:17:33.400 --> 0:17:35.960 spent three decades in Asia as both China editor and 0:17:35.960 --> 0:17:38.520 columnist for The Wall Street Journal. Today, he leads the 0:17:38.600 --> 0:17:41.560 China Hub. He is a partner at Brunswick Group, a 0:17:41.640 --> 0:17:44.120 critical issues advisory from Andy back with us via Zoo 0:17:44.160 --> 0:17:46.720 in New York City. Andy, thank you, thank you. Good 0:17:46.720 --> 0:17:50.040 to have you here with Maddie and myself. What's your 0:17:50.040 --> 0:17:53.879 read on President mccrone's visit and then the comments post 0:17:53.960 --> 0:17:56.840 his visit to China. Well, first of all, it's great 0:17:56.840 --> 0:18:00.080 to be with you, Carol and Maddie. The comments, as 0:18:00.119 --> 0:18:05.000 you say, really are quite extraordinary and have been interpreted 0:18:05.600 --> 0:18:11.320 as inflammatory in fact by China hooks in the US. 0:18:11.400 --> 0:18:13.400 I mean, you've got to remember the context. I mean 0:18:13.440 --> 0:18:17.960 here he is the French President Emmanuel Macron in China, 0:18:18.160 --> 0:18:22.280 saying that Europe should distance itself from the United States 0:18:22.640 --> 0:18:25.480 at a time when the United States is involved in 0:18:25.480 --> 0:18:31.840 intense strategic competition with China, competition over Taiwan, over the 0:18:31.880 --> 0:18:35.720 South China Sea. They're at loggerheads over high technology, over 0:18:35.840 --> 0:18:40.760 human rights, over the situation in Ukraine. And Macron comes 0:18:40.760 --> 0:18:44.200 out and he says, no, we need strategic autonomy. We're 0:18:44.200 --> 0:18:47.919 not going to be followers. And the most explosive of 0:18:48.000 --> 0:18:50.640 His comments was, and we're not going to be dragged 0:18:50.800 --> 0:18:56.560 by the United States into a conflict over Taiwan. And 0:18:56.880 --> 0:18:59.280 you know, this is this is a this is this 0:18:59.440 --> 0:19:05.280 too to politicians like Marco Rubio really is outrageous. So 0:19:05.359 --> 0:19:10.560 he's saying, Okay, here we are the United States defending Europe, 0:19:10.600 --> 0:19:17.200 sending aid, sending arms, military equipment to Ukraine, and you're saying, 0:19:17.440 --> 0:19:19.159 you know you're not going to get in, You're not 0:19:19.160 --> 0:19:24.200 going to support us in Taiwan. Why now for this 0:19:24.280 --> 0:19:29.600 move from Macron? You know, he's he's always sought what 0:19:29.680 --> 0:19:37.159 he calls strategic autonomy somewhere between the United States and China. 0:19:37.280 --> 0:19:42.119 This time he talked about creating a European third superpower. 0:19:42.400 --> 0:19:47.080 But you know, business and economics plays very much into 0:19:47.160 --> 0:19:53.000 this scenario. Macron arrives in China with fifty odd business 0:19:53.040 --> 0:20:01.080 executives in tow representing industries from fashion to to to nuclear, 0:20:01.840 --> 0:20:05.760 and they're all doing great deals. So he's making clear 0:20:06.160 --> 0:20:10.040 the difference between the United States and Europe on this 0:20:10.240 --> 0:20:13.879 and in fact, that sense is quite broadly shared in 0:20:13.920 --> 0:20:16.720 Europe that you know, Europe doesn't want to go in 0:20:16.760 --> 0:20:23.080 for economic decoupling. Ursola Van Delay and the European President 0:20:23.080 --> 0:20:25.840 of the European Commission was quite clear on this point. 0:20:25.920 --> 0:20:29.160 She said, we want de risking from China. We don't 0:20:29.240 --> 0:20:36.880 want decoupling. But certainly Macron sees commercial opportunity in China's reopening. 0:20:37.040 --> 0:20:40.320 And by the way, President Jimping of China, this is 0:20:40.359 --> 0:20:44.920 all music to his igness. Relations with the United States 0:20:44.960 --> 0:20:47.600 are on ice and here's Europe coming along with trade 0:20:48.080 --> 0:20:52.600 offers of trade and technology. It's exactly what he needs 0:20:52.600 --> 0:20:55.520 at this point. Well, and is it similar Andy, I 0:20:55.600 --> 0:20:58.280 know we've talked about this a lot over the years. 0:20:58.440 --> 0:21:00.840 Is it the same for US businesses? We just talked 0:21:00.840 --> 0:21:04.199 about Tesla building a large new battery factory in Shanghai. 0:21:04.280 --> 0:21:07.960 So further digging in deeper when it comes to China specifically, 0:21:08.240 --> 0:21:11.159 I mean US big companies, they're still going to be 0:21:11.200 --> 0:21:15.240 in China doing business or no? Yeah, Well, in some ways, 0:21:15.359 --> 0:21:19.960 Elon Musk is quite exceptional. It's the rare US CEO 0:21:20.280 --> 0:21:24.320 that's going out there now and announcing big business deals 0:21:24.359 --> 0:21:27.600 with China. In fact, we just had a big conference 0:21:27.720 --> 0:21:30.560 in Beijing called the China Development Forum run by the 0:21:30.640 --> 0:21:35.000 Chinese government, the Chinese State Council. Far fewer US corporate 0:21:35.000 --> 0:21:38.359 executives than usual were there. They were rather reluctant to 0:21:39.440 --> 0:21:43.199 turn out. They definitely didn't want to do any media 0:21:43.600 --> 0:21:47.399 and they certainly didn't want to make any announcements of 0:21:47.640 --> 0:21:51.280 investments in China, which might expose them to criticism by 0:21:51.320 --> 0:21:55.800 this newly created House Committee on China, which plans to 0:21:56.440 --> 0:22:01.240 haul US CEOs and other prominent figures connections to China 0:22:01.800 --> 0:22:05.400 in front of the Committee for televised hearings. They're very 0:22:05.400 --> 0:22:08.520 nervous about that. So, yeah, this is advantage Europe versus 0:22:08.560 --> 0:22:11.440 the United States, certainly when it comes to corporate engagement. 0:22:12.280 --> 0:22:14.960 It's it's so interesting because I also have to wonder 0:22:15.040 --> 0:22:19.160 whether when it comes to she Jane Payne, are these 0:22:19.200 --> 0:22:22.560 CEOs concerned about the lack of predictability there. We just 0:22:22.680 --> 0:22:25.920 got through years of COVID zero in China. To what 0:22:26.119 --> 0:22:30.480 extent are people willing and ready to move on from 0:22:30.560 --> 0:22:32.760 that and say, well, this is an opportunity now, so 0:22:32.840 --> 0:22:37.080 let's fly over there with fifty CEOs into Yeah, well, 0:22:37.119 --> 0:22:44.639 the the Joe Biden is highly unlikely to replicate that 0:22:44.640 --> 0:22:47.359 that kind of mission. In fact, the US is working 0:22:47.359 --> 0:22:52.760 in the opposite direction. It wants economic containment of China, 0:22:53.160 --> 0:22:56.280 not economic engagement with China is certainly in the area 0:22:56.359 --> 0:22:59.960 of high tech. That's what the Inflation Reduction Act is 0:23:00.040 --> 0:23:02.480 all about. That's what chips and science. It's all about 0:23:02.600 --> 0:23:05.960 billions of dollars to build supply chains in the United States, 0:23:05.960 --> 0:23:09.439 to bring jobs back from China, and to make the 0:23:09.520 --> 0:23:13.800 United States less reliant on China. So it's all working 0:23:14.560 --> 0:23:18.280 really in quite the opposite direction. But US businesses in 0:23:18.359 --> 0:23:21.000