WEBVTT - The Fed, The Yen, and Disney 0:00:00.080 --> 0:00:06.760 Bloomberg Audio Studios, Podcasts, radio news. 0:00:11.960 --> 0:00:15.560 This is the Bloomberg Surveillance Podcast. I'm Tom Keene along 0:00:15.600 --> 0:00:18.960 with Paul Sweeney. Join us each day for insight from 0:00:18.960 --> 0:00:23.160 the best in economics, finance, investment, and international relations. You 0:00:23.160 --> 0:00:26.520 can also watch the show live on YouTube. Visit the 0:00:26.520 --> 0:00:31.280 Bloomberg Podcast channel on YouTube to see the show weekday 0:00:31.280 --> 0:00:34.320 mornings from seven to ten am Eastern from our global 0:00:34.360 --> 0:00:39.000 headquarters in New York City. Subscribe to the podcast on Apple, Spotify, 0:00:39.360 --> 0:00:42.920 or anywhere else you listen and always I'm Bloomberg Radio, 0:00:43.080 --> 0:00:47.040 the Bloomberg Terminal, and the Bloomberg Business app. This is 0:00:47.040 --> 0:00:49.640 a joy and you people go to me, why do 0:00:49.680 --> 0:00:52.159 you celebrate people that get it wrong? And I had 0:00:52.159 --> 0:00:56.080 a blistering argument once with some people about this. You 0:00:56.200 --> 0:00:59.200 learn just as much from people who get it wrong 0:01:00.080 --> 0:01:02.080 as you do from people to get it right. But 0:01:02.160 --> 0:01:06.360 it's always a joy to have somebody in who absolutely 0:01:06.720 --> 0:01:09.319 nailed this. And he has an informative note this morning 0:01:09.360 --> 0:01:13.039 from the Bank of Montreal Female Capital Markets. With the 0:01:13.160 --> 0:01:16.800 victory lap of the last eighteen months, Ian Lingen, with 0:01:16.920 --> 0:01:20.080 a ten year yield below four percent, did you figure 0:01:20.120 --> 0:01:24.120 we would go price up? Yield? Down in this manner 0:01:24.760 --> 0:01:26.479 or do you just make the guests? And we got 0:01:26.480 --> 0:01:27.640 there for a different reason. 0:01:28.280 --> 0:01:31.959 I've been reasonably confident that something would break with the 0:01:32.040 --> 0:01:34.640 terminal rate as high as it was, for as long 0:01:34.720 --> 0:01:37.160 as it was. It's we're going to end up on 0:01:37.400 --> 0:01:40.679 four hundred and twenty one days at five point five 0:01:40.760 --> 0:01:43.959 percent as the upper bound come the eighteenth of September, 0:01:44.280 --> 0:01:46.920 and that is going to be not a record, but 0:01:47.200 --> 0:01:49.640 a very significant degree of tightening. 0:01:49.720 --> 0:01:51.600 I talked to Matt Lazatti. I didn't get to this. 0:01:51.640 --> 0:01:53.520 I'm going to get to it right now with Ian Ling. 0:01:53.600 --> 0:01:56.840 A nice move there, Paula changed the micro around Zucki's 0:01:56.880 --> 0:01:58.520 you know, a pack could work at the Olympics in 0:01:58.560 --> 0:02:00.920 Paris on it to get the mic in front of 0:02:01.120 --> 0:02:04.760 the pole vault. And I didn't get to this with Lyzetti. 0:02:05.160 --> 0:02:09.560 But the answer is, formulas like the Taylor rule are 0:02:09.960 --> 0:02:13.880 wildly distant now from where the FED is. How urgent 0:02:14.040 --> 0:02:17.040 is it that the FED catch up to what John 0:02:17.120 --> 0:02:20.560 Taylor at Stanford says, or other people frankly say they 0:02:20.560 --> 0:02:20.960 should be. 0:02:22.160 --> 0:02:24.519 I think that the FED is cognizant of this, and 0:02:24.880 --> 0:02:28.240 that's why they opened the discussion. They laid the groundwork 0:02:28.320 --> 0:02:32.760 for rate cuts in December of last year. Recall Powell's pivot. 0:02:33.040 --> 0:02:35.480 Now that didn't play out, and we all remember what 0:02:35.560 --> 0:02:39.799 happened between January and March. But by opening that discussion, 0:02:40.240 --> 0:02:43.040 the FED has allowed the market to do some of 0:02:43.080 --> 0:02:45.320 the heavy lifting for it. So that's one of the 0:02:45.360 --> 0:02:48.640 reasons that equities had been performing as well as they 0:02:48.680 --> 0:02:54.120 had and real rates, while elevated, were not at concerning 0:02:54.320 --> 0:02:56.880 levels as we have seen in prior cycles. 0:02:57.560 --> 0:03:00.160 So I'm an equity guy. I don't know what this 0:03:00.240 --> 0:03:01.760 rate market thing is all about. I go to you 0:03:01.800 --> 0:03:04.840 guys in Ira Jersey. Is fifty basis points baked in 0:03:04.880 --> 0:03:07.480 for September? Or is there still some debate about September. 0:03:07.880 --> 0:03:10.520 I think it's still a very active debate about September. 0:03:10.919 --> 0:03:13.639 I'm in the twenty five basis point camp, and the 0:03:13.720 --> 0:03:17.359 logic there is we have three more key data releases 0:03:17.400 --> 0:03:20.960 before the FED decides. We have two CPI prints and 0:03:21.280 --> 0:03:25.120 a payrolls number, and frankly, Friday's number, while it was 0:03:25.120 --> 0:03:29.400 somewhat troubling, was certainly not catastrophic. We have an unemployment 0:03:29.480 --> 0:03:32.239 rate that's still below four and a half percent. We 0:03:32.280 --> 0:03:35.119 have positive payrolls growth, and at the end of the day, 0:03:35.320 --> 0:03:38.680 the FED wanted to instill a degree of balance into 0:03:38.680 --> 0:03:40.880 the labor market, and that's precisely what they got. 0:03:41.280 --> 0:03:44.720 Monday morning, there was a little bit of panic in 0:03:44.760 --> 0:03:46.640 the market. It felt like, you know, I hadn't felt 0:03:46.640 --> 0:03:48.160 that in a while. I hadn't seen that in a while. 0:03:48.360 --> 0:03:51.800 People were actually talking about an emergency rate cut. Is 0:03:51.800 --> 0:03:54.640 that something or is that just overblown concern on a 0:03:54.640 --> 0:03:55.200 Monday morning. 0:03:55.880 --> 0:03:59.280 Well, given the price action that would that played out 0:03:59.280 --> 0:04:00.960 on Monday morning, was going on with the y in 0:04:01.040 --> 0:04:04.280 what was going on with Japanese equities and global equities 0:04:04.280 --> 0:04:07.600 more broadly, one would have been remiss not to at 0:04:07.680 --> 0:04:11.640 least have an emergency cut as a as a potential. 0:04:11.960 --> 0:04:15.200 But now we've stabilized, and as we've stabilized, the bar 0:04:15.400 --> 0:04:18.679 has increased for the FED to consider cutting rates before 0:04:18.720 --> 0:04:19.839 the eighteenth of September. 0:04:19.960 --> 0:04:22.200 I came in this morning, and this is the glory 0:04:22.240 --> 0:04:24.360 days of twenty years ago. I used to It's how 0:04:24.360 --> 0:04:27.479 I got my job. I used to construct fancy charts. Okay, 0:04:27.480 --> 0:04:30.280 I did log vix. That's its own story. It's away 0:04:30.320 --> 0:04:34.000 from me and Lingoen. But I did log inflation adjusted 0:04:34.040 --> 0:04:37.039 ten year yield the real yield. So I had a 0:04:37.120 --> 0:04:39.840 higher real yield as far back as July two point 0:04:39.920 --> 0:04:43.800 zero zero percent two point zero two. We gloriously come in. 0:04:43.880 --> 0:04:47.120 Then we have Japan, we come in even further. Where's 0:04:47.240 --> 0:04:50.919 a normal real yield right now? I think even Global 0:04:50.960 --> 0:04:53.720 Wall Street doesn't know what to do here at a 0:04:53.800 --> 0:04:56.880 one point eight zero is that elevated still? 0:04:57.320 --> 0:05:00.400 I would say that that's still elevated, and the FED 0:05:00.440 --> 0:05:03.800 would argue that's still restrictive. But the reality is, we 0:05:03.839 --> 0:05:06.400 don't need to go back to zero in terms of 0:05:06.480 --> 0:05:07.120 where we. 0:05:07.080 --> 0:05:09.360 Need to go to to get an efficacy for the 0:05:09.440 --> 0:05:11.120 overall financial system. 0:05:11.400 --> 0:05:14.400 I think that our estimates somewhere in the fifty to 0:05:14.480 --> 0:05:18.159 seventy five basis point range under one percent, under one percent, 0:05:18.240 --> 0:05:19.200 you got it, We give me. 0:05:19.320 --> 0:05:22.880 That's an American if one of their Canadian shock, that's 0:05:22.880 --> 0:05:24.360 why are you kidding me? 0:05:24.800 --> 0:05:27.200 No? I think that that's actually a reasonable level to 0:05:27.520 --> 0:05:30.240 assume for real rates over the next. 0:05:29.920 --> 0:05:32.760 So you're modeling out a six percent nominal GDP. If 0:05:32.760 --> 0:05:35.440 we get a pop down to point five zero positive 0:05:35.800 --> 0:05:40.359 ten year inflation is just yield, You're goosen You gotta 0:05:40.400 --> 0:05:43.240 be goosen out. To six percent nominal unless you get 0:05:43.279 --> 0:05:44.919 global disinflation. 0:05:44.440 --> 0:05:47.360 Right, And what's to assume that we won't find ourselves 0:05:47.440 --> 0:05:50.640 in a disinflationary environment globally? And I think that that's 0:05:50.680 --> 0:05:53.040 what we're running up against, and that's what to a 0:05:53.120 --> 0:05:56.000 large extent, the FED is trying to avoid, and that's 0:05:56.040 --> 0:05:58.080 why they're being as proactive. 0:05:58.160 --> 0:06:00.440 I mentioned this all three times a sweek. Last week's 0:06:00.440 --> 0:06:03.640 single sentence that mattered way lead black Rock. She's model 0:06:03.680 --> 0:06:07.160 in China at a three percent run rate, yep, nobody 0:06:07.200 --> 0:06:09.640 even eating Lincoln. At least some Tao's ready for that, 0:06:09.680 --> 0:06:10.839 but not even Lincoln. 0:06:11.120 --> 0:06:14.040 And when the FED starts cutting rates, let's assume it's September, 0:06:14.600 --> 0:06:18.080 how do they proceed from there? Is it every twenty 0:06:18.080 --> 0:06:20.719 five basis points every meeting, every other meeting? Do they 0:06:21.120 --> 0:06:23.240 keep it open maybe fifty points at some point? 0:06:23.279 --> 0:06:24.279 How does that work? Usually? 0:06:24.960 --> 0:06:29.000 Well, we're certainly in a typical environment. And so far 0:06:29.040 --> 0:06:31.240 as the FED is not responding to a crisis, at 0:06:31.320 --> 0:06:35.160 least not yet, all they're doing is going from restrictive 0:06:35.240 --> 0:06:38.800 to less restrictive. So they're not easing in the traditional sense, 0:06:39.080 --> 0:06:42.960 and so that will afford them the opportunity to deliver 0:06:43.160 --> 0:06:45.920 quarterly rate cuts if they deem necessary. So twenty five 0:06:45.960 --> 0:06:49.560 basis points a quarter is our base case scenario. Okay, 0:06:49.920 --> 0:06:53.200 depending on what the next couple weeks gives us in 0:06:53.279 --> 0:06:55.599 terms of data, we might actually pencil in another twenty 0:06:55.600 --> 0:06:56.440 five for November. 0:06:57.880 --> 0:07:00.880 How about the political aspect to it? I mean year that. 0:07:01.480 --> 0:07:02.120 How does the Fed? 0:07:03.279 --> 0:07:06.840 Are you talking Canada or US? He was, okay. 0:07:07.800 --> 0:07:10.560 I think that the presidential election has made it a 0:07:10.560 --> 0:07:14.240 bit more difficult for the Fed to do either a 0:07:14.280 --> 0:07:17.320 fifty or an inter meeting cut because there's the political 0:07:17.400 --> 0:07:20.640 aspect of it. But twenty five has been well telegraphed 0:07:20.640 --> 0:07:21.720 and is baked into market. 0:07:21.760 --> 0:07:24.040 I've got to make some news here. You've been the genius. 0:07:24.240 --> 0:07:27.000 I can't say enough, folks, how Lincoln's led the charge? 0:07:27.320 --> 0:07:30.200 David Roseberg? What is it about Canada? I don't know, Montreal, 0:07:30.320 --> 0:07:32.840 Wan Rosenberg up in Toronto. It's the air of the water. 0:07:33.120 --> 0:07:36.240 Maybe it's the La bats all. Excuse me, Molson. I'm sorry, 0:07:36.320 --> 0:07:39.200 banker Montreal, but I lingen help me here. If I 0:07:39.240 --> 0:07:42.400 get a point five zero ten year real yield, where 0:07:42.440 --> 0:07:45.480 does that put nominal tenure in the Lincoln universe? 0:07:46.000 --> 0:07:49.880 Well, we will be pushing back below three percent. Now 0:07:50.000 --> 0:07:52.720 that's not going to be this year, but that is 0:07:52.840 --> 0:07:56.960 certainly on the horizon for let's call it the next 0:07:57.000 --> 0:07:57.880 twenty four months. 0:07:58.160 --> 0:08:03.080 You are modeling sub three ten year two point ninety 0:08:03.120 --> 0:08:04.040 five percent. 0:08:04.320 --> 0:08:06.640 Now by the end of two thousand and twenty six. 0:08:06.840 --> 0:08:07.360 Very doable. 0:08:07.480 --> 0:08:09.920 All right, I'm gonna refinance the mortgage. There now we're 0:08:09.920 --> 0:08:11.640 talking eat Lincoln. 0:08:11.680 --> 0:08:14.040 Thank you so much at BEMO Capital Markets. I can't 0:08:14.040 --> 0:08:17.040 say enough about it, folks. It's the most valuable fixed 0:08:17.040 --> 0:08:20.480 income note. Good morning, Ira, Jersey on the street. Go 0:08:20.560 --> 0:08:23.440 to Bemo Capital Markets to see what Lincoln's thinking about. 0:08:33.679 --> 0:08:37.000 It's a three hour conversation with the most important effects 0:08:37.080 --> 0:08:40.240 person on the planet. Audrey Child Freeman joins us now 0:08:40.480 --> 0:08:44.760 with Bloomberg Intelligence, London. I just got to digress here, Audrey, 0:08:45.280 --> 0:08:49.120 pret time is precious. Your thoughts on the success of 0:08:49.200 --> 0:08:52.760 France delivering the best Olympics ever? What's it like? 0:08:54.480 --> 0:08:58.960 It feels good. It's not finished yet, but so far 0:08:59.040 --> 0:09:02.320 Stuth and needed feedback has been amazing. And what we 0:09:02.480 --> 0:09:07.160 hear from Paris is the atmosphere is excellent, and so 0:09:07.200 --> 0:09:10.400 it's a big success after early uncertainties. 0:09:11.559 --> 0:09:14.160 Under the headlines, and folks, I can't say enough how 0:09:14.200 --> 0:09:18.440 Audrey dives deeper. Audrey, I'm looking at the Japanese ten 0:09:18.520 --> 0:09:23.280 year real yield and basically the experiment they've done for 0:09:23.320 --> 0:09:25.400 the last three, four or five years has a long 0:09:25.440 --> 0:09:28.960 way to go. Do you agree that we're only partly 0:09:29.240 --> 0:09:32.080 through the young clearing experiment? 0:09:34.240 --> 0:09:37.959 I agree with that view. I agree with the view 0:09:38.040 --> 0:09:43.280 that the unwind of the carry trade is not completed yet. 0:09:43.960 --> 0:09:49.040 I am very cautious in trying to quantify how much 0:09:49.080 --> 0:09:51.720 we've seen and how much is left. But you know, 0:09:51.720 --> 0:09:54.240 if you look at some of the indicators, such as 0:09:54.320 --> 0:09:57.520 the CFTC numbers for instance, which gives you a little 0:09:57.559 --> 0:10:00.040 bit of a flavor as to where we are, it 0:10:00.080 --> 0:10:03.160 would appear that, you know, the market is still underweight 0:10:04.160 --> 0:10:08.200 the end. So yes, the answer is we're probably not 0:10:08.360 --> 0:10:12.280 done yet. And to go back to the early point 0:10:12.320 --> 0:10:16.080 you were making about the BOJ, I also feel that, yes, 0:10:16.160 --> 0:10:18.760 the BOJ had a big part to play in that 0:10:18.840 --> 0:10:21.600 move last week and in the past few weeks. But 0:10:21.640 --> 0:10:26.000 for me, it's been very much, you know, fed driven, 0:10:26.600 --> 0:10:29.720 and I also feel that the second or the next leg, 0:10:29.720 --> 0:10:31.160 I don't know if you can call it second, but 0:10:31.240 --> 0:10:36.320 the next leg lower in yen will also be mainly 0:10:36.960 --> 0:10:38.000 fed driven. 0:10:38.200 --> 0:10:39.839 Do you have a target on it that's support? And 0:10:39.880 --> 0:10:42.880 if we get through one fifty, where does audrichild Freeman 0:10:42.920 --> 0:10:44.120 feel weak and can go? 0:10:44.880 --> 0:10:48.280 So I think at the moment it's it's very difficult 0:10:48.480 --> 0:10:51.240 to agree to give you a level right now, just 0:10:51.520 --> 0:10:54.800 you know the direction is If you get the direction right, 0:10:55.000 --> 0:11:00.679 you're a hero. But I think the level what I 0:11:00.679 --> 0:11:05.480 will wait to see is where the new ranges establish themselves. 0:11:05.559 --> 0:11:08.200 You know, we're still not sure that you know, we're 0:11:08.200 --> 0:11:11.880 not going to see, you know, another big wave of 0:11:12.000 --> 0:11:14.440 moves in the in the next few sessions. You know, 0:11:14.480 --> 0:11:17.439 we've one we've gone to one forty two inch a 0:11:17.559 --> 0:11:20.720 day on Monday, we're back at one forty seven today 0:11:20.920 --> 0:11:26.280 just on the boj rape mentioned this morning. Yesterday we 0:11:26.280 --> 0:11:28.160 were one forty five. So what I need to see 0:11:28.200 --> 0:11:30.920 first is is the new kind of range that we 0:11:31.040 --> 0:11:34.240 base ourselves from one forty five to one fifty and 0:11:34.280 --> 0:11:37.920 that's where I kind of expected to be. And if so, 0:11:38.080 --> 0:11:40.480 what do we do? And what I do is I 0:11:40.559 --> 0:11:45.240 wait for, you know, the next trigger to move lower. 0:11:45.280 --> 0:11:48.360 And I kind of feel that that next trigger may 0:11:48.480 --> 0:11:52.479 come from the US but it won't be as extreme 0:11:52.679 --> 0:11:56.640 as what we've seen in the past few sessions and weeks. Do. 0:11:56.720 --> 0:11:57.920 I think a lot of folks are trying to get 0:11:57.920 --> 0:12:00.240 a handle on, you know, we get the yen from 0:12:00.280 --> 0:12:02.560 one sixty to one forty, now we're back at you know, 0:12:02.920 --> 0:12:06.960 kind of one forty seven. What's moving the Is it 0:12:07.040 --> 0:12:09.720 the Bank of Japan? Is it the market? I mean, 0:12:10.160 --> 0:12:13.400 is this normal? What's kind of moving this market so dramatically? 0:12:14.320 --> 0:12:18.000 So it's certainly not normal. I just feel that it 0:12:18.120 --> 0:12:21.160 was very much a combination of factors together. So we 0:12:21.280 --> 0:12:25.920 talked about the weakness in the US employment report on 0:12:26.160 --> 0:12:28.560 last Friday, and I should say softness. You know, it 0:12:28.600 --> 0:12:32.280 wasn't dramatically weak. It was just softer than what would 0:12:32.320 --> 0:12:37.400 become used to for the US employment reports. As well 0:12:37.440 --> 0:12:40.600 as you know, the bog coming up more hawkish and 0:12:40.679 --> 0:12:43.720 expected last week. And this was happening at a time 0:12:43.800 --> 0:12:48.640 when positioning was had become extreme earlier in the in 0:12:48.679 --> 0:12:51.400 the summer, certainly when we were trading around sixty two. 0:12:52.559 --> 0:12:54.680 And the final point I would add, you know, the 0:12:54.800 --> 0:12:59.040 kind of icing on the take last week was It's 0:12:59.040 --> 0:13:02.440 still difficult to sets what trader was, but certainly the 0:13:02.520 --> 0:13:07.199 risk of market sentiment that we had via other asset classes, 0:13:07.200 --> 0:13:10.960 the equity market downside, that exacerbated the on wide on 0:13:11.040 --> 0:13:15.520 some of the crosses and EMFX and em instance. That's 0:13:15.640 --> 0:13:16.360 another reason. 0:13:16.840 --> 0:13:19.160 Quickly, I got only one minute. How do you use 0:13:19.280 --> 0:13:23.239 real yield analysis right now? How do you use inflation 0:13:23.480 --> 0:13:25.160 adjusted yields in your study? 0:13:26.640 --> 0:13:30.800 Well, what we think is that the US and the FED, 0:13:31.720 --> 0:13:36.240 this inflation story should allow the FED to cut interest rates. 0:13:36.800 --> 0:13:41.000 And remember that the narrative on the FED has moved 0:13:41.160 --> 0:13:44.679 so much in the course of the year. And that's 0:13:44.720 --> 0:13:47.480 you know, from talking rate hike a few months ago 0:13:47.840 --> 0:13:52.600 to no hike at all, to maybe a precautionary red cut. Sorry, 0:13:53.160 --> 0:13:55.839 and now we're talking about a series of rate cuts 0:13:55.840 --> 0:13:58.160 for this year. We're talking about one hundred bits rate cuts. 0:13:58.559 --> 0:14:02.000 So this is how in the context of this inflation 0:14:02.480 --> 0:14:05.600 in the US, and that's probably enough to take your 0:14:05.679 --> 0:14:07.920 dollar narrative lower. 0:14:08.480 --> 0:14:11.040 This has been helpful, Audrey Child Freeman, thank you so much. 0:14:11.080 --> 0:14:15.040 Publishing at Bloomberg Intelligence can't say enough about their value 0:14:15.080 --> 0:14:24.240 add on the Bloomberg terminal. We pride ourselves on a 0:14:24.360 --> 0:14:28.240 different set of guests. Brian Weezer from day one has 0:14:28.280 --> 0:14:31.960 been different. We're thrilled that he could join us this morning. 0:14:32.040 --> 0:14:36.520 Just lots going on there with Madison and while Brian 0:14:36.760 --> 0:14:39.080 out broken, Brian Weezer is Disney. 0:14:40.760 --> 0:14:44.280 I don't think it's broken. I think that they, like 0:14:44.320 --> 0:14:46.480 a lot of media companies, have been struggling to figure 0:14:46.480 --> 0:14:48.360 out what to do and how to organize themselves for 0:14:48.400 --> 0:14:52.160 the future. I think that they had strategic clarity in October. 0:14:52.360 --> 0:14:55.560 They're about the twenty eighteen when they launched Disney Plus. 0:14:56.080 --> 0:14:59.640 I think they lost a lot of strategic clarity certainly 0:14:59.720 --> 0:15:03.520 going into the return of Bob Iger and in the 0:15:03.560 --> 0:15:06.240 subsequent periods they're still trying to figure a lot of 0:15:06.280 --> 0:15:09.520 things out. You know, they really had the right strategy 0:15:09.520 --> 0:15:11.320 trying to focus on global for lack of better word, 0:15:11.360 --> 0:15:14.520 domination in the streaming work, going head ahead with Netflix 0:15:14.560 --> 0:15:17.520 and Amazon on the streaming video often that's. 0:15:17.320 --> 0:15:18.000 The heart of the matter. 0:15:18.920 --> 0:15:19.480 Yeah, I think so. 0:15:19.600 --> 0:15:22.040 I mean, the bottom line is they're going up against giants. 0:15:22.040 --> 0:15:22.240 They are. 0:15:22.240 --> 0:15:24.520 They're going up against giants, but they're a giant themselves. Brian. 0:15:24.760 --> 0:15:27.960 They did actually show some profitability in the streaming business 0:15:28.040 --> 0:15:30.440 here today. What do you and Arresta Wall Street think 0:15:30.440 --> 0:15:34.160 about the future of that business From a profitability perspective. 0:15:34.920 --> 0:15:37.360 Well, I think most of Wall Street is really focused 0:15:37.400 --> 0:15:39.960 on profitability to your point now where I sit, which 0:15:40.040 --> 0:15:45.040 is well Madison wall We we think that they really 0:15:45.040 --> 0:15:47.360 need to focus on focusing on ongoing scale, which might 0:15:47.440 --> 0:15:49.840 mean profitability is a later thing, because if you want 0:15:49.920 --> 0:15:53.440 to build up to compete better globally with Netflix and Amazon, 0:15:53.760 --> 0:15:55.600 I think profits is something you've got to focus on 0:15:55.760 --> 0:15:59.080 later on. They've got parks fund profits. I think if 0:15:59.080 --> 0:16:00.600 you want to build a streamin is you have to 0:16:00.640 --> 0:16:03.720 continue to invest in content, programming and distribution. 0:16:04.720 --> 0:16:07.240 So, Brian, they thought it's actually a pretty good quarter 0:16:07.360 --> 0:16:10.280 from the box office the studio. Have they gotten their 0:16:10.280 --> 0:16:13.600 mojo back there with all the Disney studio product? 0:16:14.760 --> 0:16:17.440 Yeah, it definitely seems like I haven't focused on the 0:16:17.480 --> 0:16:20.360 studio results right now. I mean, obviously everyone's aware of 0:16:20.560 --> 0:16:24.080 just how well I think it set out Deadpool done. 0:16:24.600 --> 0:16:27.080 But I think that one could say, yeah, it feels 0:16:27.160 --> 0:16:29.200 like they maybe they never really lost it. It was 0:16:29.240 --> 0:16:31.120 just a couple of bad movies, Brian. 0:16:31.200 --> 0:16:35.239 The music businesses having an existential crisis over what copyrights 0:16:35.240 --> 0:16:38.040 are worth. Is it the same with the catalogs of 0:16:38.120 --> 0:16:44.040 the studios is Pinocchio or Dumbo or you know something 0:16:44.040 --> 0:16:48.480 new Mandalorian. Are those copyrights maybe just simply not worth 0:16:48.520 --> 0:16:51.200 the goodwill or bad will on the balance sheet? 0:16:52.520 --> 0:16:53.080 Yeah, you know. 0:16:53.560 --> 0:16:56.560 Well, here's the thing. When it comes to streaming services, 0:16:56.920 --> 0:17:00.440 you come for the new original content and you stay 0:17:00.640 --> 0:17:05.080 for the library. Disney has this massive and amazing skill 0:17:05.240 --> 0:17:08.959 library and no one else will likely ever have anything 0:17:09.240 --> 0:17:11.840 like that, but not for a very long time. So 0:17:12.440 --> 0:17:14.919 they need both, right as long as they continue to 0:17:14.960 --> 0:17:17.879 have more and better programming, and Hulu I think has 0:17:17.880 --> 0:17:21.720 been crushing it from that front. Disney plus arguably needs 0:17:21.720 --> 0:17:25.320 a lot more. Then there's something for people to come 0:17:25.600 --> 0:17:28.280 for initially and then stick around for. So I think 0:17:28.320 --> 0:17:31.240 you do need both, and Disney there'll be better positions 0:17:31.280 --> 0:17:35.399 they invest again more in programming and content for originals 0:17:35.440 --> 0:17:38.200 to support what they already have in this great library. 0:17:38.920 --> 0:17:41.359 We can we have a moment of silence for Brian 0:17:41.359 --> 0:17:43.720 Weezer quickly here Paul asked him a question on this. 0:17:44.440 --> 0:17:49.000 Brian Weezer nailed NBC in the Olympics. Yeah, nailed it 0:17:49.160 --> 0:17:50.800 five years ago exactly. 0:17:51.119 --> 0:17:53.480 So hey, Brian, just to go down that path, I mean, 0:17:53.520 --> 0:17:55.920 I'm having fun with the Olympics. What does it mean 0:17:56.000 --> 0:17:59.159 for comcasts and NBC Universal? Is this gonna be a 0:17:59.200 --> 0:18:00.680 win for them? 0:18:01.160 --> 0:18:04.120 Well, I mean, here's the thing. It's probably they're better 0:18:04.160 --> 0:18:06.120 off having it than not, I guess is a better 0:18:06.119 --> 0:18:09.840 way to put it. It's a really expensive proposition obviously 0:18:10.000 --> 0:18:12.399 to run the Olympics, and I'm sure they'll say, you know, 0:18:12.480 --> 0:18:15.400 they'll make a profit on the Olympics and that's good 0:18:15.440 --> 0:18:18.320 for them. But you could also argue, well, couldn't they 0:18:18.320 --> 0:18:21.160 also invest in other programming and be just as well 0:18:21.200 --> 0:18:24.240 off profit wise. Probably, So, I don't think we want 0:18:24.280 --> 0:18:30.000 to overstate it as somehow you know, uniquely positive as 0:18:30.000 --> 0:18:32.680 a way to build a business. It's definitely a way 0:18:32.680 --> 0:18:34.280 to build a business. But I don't think we want 0:18:34.280 --> 0:18:35.160 to overstate it either. 0:18:35.520 --> 0:18:37.399 Brian on short notes, thank you so much for the 0:18:37.480 --> 0:18:51.840 huge announcment from Disney spiking up early and by public acclaim, 0:18:51.880 --> 0:18:53.760 I mean your daily look at the front pages of 0:18:53.840 --> 0:18:56.560 Lisa Minna Tello our Lisa way too long? 0:18:56.600 --> 0:19:00.280 What do you have you missed it? Okay, have you 0:19:00.359 --> 0:19:02.040 been to the movies lately? 0:19:02.480 --> 0:19:05.320 This is the problem. See that's the problem. Okay, a 0:19:05.320 --> 0:19:08.240 lot of people not going to the movies. So theaters 0:19:08.240 --> 0:19:10.480 are offering different perks, they're trying different things. There have 0:19:10.600 --> 0:19:13.480 been some summer hits, you know, Deadpool, Wolverine, I'll probably 0:19:13.480 --> 0:19:16.800 see it this weekend, Inside Out two, Despicable Me for 0:19:17.119 --> 0:19:20.359 those were big things this summer. But ticket sales still 0:19:20.440 --> 0:19:22.720 lagging behind last year. I mean, the summer is the 0:19:22.760 --> 0:19:25.800 big part for theaters. It's forty percent of their domestic 0:19:25.800 --> 0:19:30.520 ticket sales. Fewer wider releases. A lot of people watching 0:19:30.560 --> 0:19:32.800 from home too, They're going to streaming. They're more comfortable 0:19:32.800 --> 0:19:36.040 at home. So what theaters are doing, they're offering perks 0:19:36.160 --> 0:19:38.480 like special popcorn buckets is one. 0:19:38.359 --> 0:19:41.600 Thing in theater playgrounds. You'll like this one. 0:19:41.720 --> 0:19:47.080 Cocktail bars inside the theaters, Okay, order ahead concessions. 0:19:47.160 --> 0:19:48.480 I know my family loves this. 0:19:48.680 --> 0:19:50.840 You do it online on your app and then you 0:19:50.880 --> 0:19:52.160 get there, you don't have to wait in the line 0:19:52.160 --> 0:19:55.840 and the popcorns just waiting for you. So those are 0:19:55.840 --> 0:19:57.320 some of the things they're doing that. A lot of 0:19:57.320 --> 0:19:59.080 them like the IMAX. 0:19:58.560 --> 0:20:01.240 Better I know for that, yeah you know, but you 0:20:01.280 --> 0:20:01.800 pay for that. 0:20:01.840 --> 0:20:04.080 But you pay extra for yeah, So they're kind of 0:20:04.119 --> 0:20:05.240 banking on that too. 0:20:06.000 --> 0:20:07.280 So a lot of changes going on. 0:20:08.640 --> 0:20:13.040 And afterthought is glued to the computer watching movies. She 0:20:13.080 --> 0:20:15.800 watched Chicago the other night. I'm trying to get her 0:20:15.800 --> 0:20:21.680 to watch Lost in translation. It's not the same theme laptop. 0:20:22.920 --> 0:20:25.440 Our kids are being cheated. It is the way I'd 0:20:25.440 --> 0:20:25.960 look at it. 0:20:26.119 --> 0:20:29.400 Yeah, there is used to even watching it on their phone. 0:20:28.920 --> 0:20:31.680 But I'm watching. I mean my parents. My parents will 0:20:31.680 --> 0:20:33.679 tell me they would go to the movies theaters two 0:20:33.800 --> 0:20:34.840 or three times a week. 0:20:34.960 --> 0:20:35.960 Oha, that was it. 0:20:37.640 --> 0:20:40.080 And then you and they had all the movie shorts 0:20:40.080 --> 0:20:42.360 and all this. So that experience is different from what 0:20:42.440 --> 0:20:44.320 we grew up with, which I still think was a 0:20:44.320 --> 0:20:48.640 good theater experience. Now to today, the case you say technology. 0:20:48.320 --> 0:20:51.040 My father aged Lawrence of Arabia, was two dollars seventy 0:20:51.040 --> 0:20:54.960 five cents. It's they got old. Next, what do you go? 0:20:55.600 --> 0:20:59.119 Taylor Swift fans, they're celebrating Kamala Harris's running mate, Tim Waltz. 0:20:59.160 --> 0:21:00.200 Okay, there's some reason. 0:21:00.000 --> 0:21:04.840 And Swift he is a swifty Okay, they're calling him 0:21:04.920 --> 0:21:06.159 the Swifty VP. 0:21:07.280 --> 0:21:08.520 A couple of things he's done. 0:21:08.760 --> 0:21:11.480 Remember back in November twenty two, right rafter that Ticketmaster 0:21:11.680 --> 0:21:15.359 disaster with the Swift tickets. So he posted a picture 0:21:15.400 --> 0:21:18.159 of his cat on X and said that you know, 0:21:18.280 --> 0:21:20.840 it was online all day and now it's not getting. 0:21:20.920 --> 0:21:24.720 Taylor Swift tickets. Then he went further. 0:21:24.760 --> 0:21:27.280 He signed this so called Taylor Swift Bill that was 0:21:27.320 --> 0:21:29.760