Speaker 1: Brought you by Bank of America, Mary Lynch. Investing in
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Speaker 1: of global connections, Mary Lynch, Pierce Fenner and Smith Incorporated
Speaker 1: Member s I p CEA. Welcome to the Bloomberg Surveillance Podcast.
Speaker 1: I'm Tom Keene with David Gura Dailey. We bring you
Speaker 1: insight from the best in economics, finance, investment, and international relations.
Speaker 1: Find Bloomberg Surveillance on iTunes, SoundCloud, Bloomberg dot Com, and
Speaker 1: of course on the Bloomberg. Let's turn our eye now
Speaker 1: to foreign affairs. I want to bring in our first guest,
Speaker 1: Micah Zenko. He is a senior fellow at the Council
Speaker 1: on Foreign Relations. Mica, thanks for joining us here here
Speaker 1: in this beautiful morning Pierre Power Breakfast. We've got the
Speaker 1: place all to ourselves. A lovely view across the park,
Speaker 1: Central Park with the snowfalling. What do you think the
Speaker 1: view is from China of the new Trump administration. We
Speaker 1: learned that the President Donald Trump sent a letter rather
Speaker 1: than a tweet, or rather than an actual phone call
Speaker 1: to Chinese President Jijing Ping, and I believe the President
Speaker 1: has spoken with a variety of foreign leaders. Why is
Speaker 1: this the way he's communicating with China? But most importantly,
Speaker 1: he's spoken by phone with the Taiwanese president before he
Speaker 1: spoke by phone with the leader recognized political leader of China.
Speaker 1: So it's hard to read the mindset of the individuals
Speaker 1: in Beijing. But the contrasting messages from senior officials from
Speaker 1: a president who makes the consistent claims of currency manipulation
Speaker 1: and trade wars to a Secretary of State and a
Speaker 1: White House spokesperson who has said that the United States
Speaker 1: will prevent China from building on islands which it claims
Speaker 1: it's there's essentially placing a naval blockade around them. So
Speaker 1: if I'm the Chinese government, I still know what Trump
Speaker 1: is serious about and what he means when he wants
Speaker 1: to have a constructive quote relationship. Well, maybe they'll be
Speaker 1: checking their Twitter account in order to get that information.
Speaker 1: And I just want to give you information about Twitter.
Speaker 1: Twitter coming in uh fourth a quarter adjusted earnings per
Speaker 1: share of sixteen cents versus the estimate of twelve cents,
Speaker 1: so a four cent beat and monthly users match estimates,
Speaker 1: So a lot of people still using Twitter, but perhaps
Speaker 1: not moving ahead I'm wondering if you could tell me, Mica,
Speaker 1: is there a strategy that you can divine from the
Speaker 1: actions of the Trump administration, because we know that China
Speaker 1: is in the cross hairs when it comes to trade
Speaker 1: but also when it comes to currency values. Sure. Well,
Speaker 1: my my assessment is this administration is still very young. Uh.
Speaker 1: Campaigns are consequence free events. You can say whatever you want,
Speaker 1: but once you become the running the running the actual country,
Speaker 1: you have to actually develop an implement policies. Right now,
Speaker 1: we haven't seen any. We've seen a series of BLUs
Speaker 1: there's to Iran that you're very non specific, telling them
Speaker 1: their unnoticed uh, seemingly giving a pass about some of
Speaker 1: russians aggressive actions in the Baltics, as well as its
Speaker 1: inability to resolve it's military dispute in Crimea, and then
Speaker 1: taking a hard line with China, but again not making
Speaker 1: any specific demands on Chinese behavior. So, uh, the sense
Speaker 1: that there's a strategy, which means a clear vision and
Speaker 1: prioritized efforts to do so, there's nothing like that yet,
Speaker 1: but that doesn't mean there won't be. This is early
Speaker 1: stages now, the early stages also with the President and
Speaker 1: the administration's relationship with the Russia and Europe. And I'm
Speaker 1: wondering if you could just describe what is Vladimir Putin's
Speaker 1: intention and how does that fit into what's going on
Speaker 1: with the European Union. It seems as though he's being
Speaker 1: successful at least in stirring the pot with Europe. Well,
Speaker 1: if you were a chriminologist and you could read Vladimir
Speaker 1: Putin's mind, you would do really well UH in the
Speaker 1: currency markets, and you should have a job doing risk analysis,
Speaker 1: because nobody's really quite known what Latim Reputin wants. The
Speaker 1: one thing we do know from his behavior and statements
Speaker 1: is he cares about the political outcomes in which Russia
Speaker 1: has an interest, as lots of great powers do, as
Speaker 1: the United States does in the Middle East, as China
Speaker 1: does in East Asia. And it's his willingness to use
Speaker 1: information influence UH, using military force at below the threshold
Speaker 1: of actual conflict to have to influence outcomes in those states.
Speaker 1: That's what's most destabilize them, to destabilize them, but also
Speaker 1: to bring into bear political outcomes that are advantageous to him.
Speaker 1: There are certain parties that the Russian government favors over others,
Speaker 1: and they're very explicit about that. They're willing to funnel
Speaker 1: money to resources to provide messaging through the Internet and
Speaker 1: social media on behalf of them. And that has destabilized
Speaker 1: a lot of European Union because it's doing it faster
Speaker 1: and more successfully than any great power has done in
Speaker 1: the past. Um, we're speaking with Micah Zenko. He is
Speaker 1: a senior fellow at the Council on Foreign Relations. Were
Speaker 1: coming to from the p Year Hotel, the Power Breakfast
Speaker 1: at Perne and you know, Mica, as we look at
Speaker 1: the future of policy, it's going to be a different Europe, right.
Speaker 1: I mean, you have the UK leaving the European Union,
Speaker 1: you have elections that are coming up in the Netherlands
Speaker 1: and France and in Germany. Has Vladimir Putin, with the
Speaker 1: maybe unintended help of President Trump, has he been able
Speaker 1: to drive a wedge? And really, is it possible that
Speaker 1: the European Union could fracture as a result of these pressures? Well,
Speaker 1: any great power wants to fracture combined forces a rate
Speaker 1: against them, or believes that there are a raid against
Speaker 1: and well certainly perceives the rate against them. And as
Speaker 1: stated that if you read Russian military doctrine, if you
Speaker 1: read the statements of the Foreign Ministry, they believe the
Speaker 1: European Union is actively looking to suppress and contain Russia.
Speaker 1: That is their narrative. Okay, But having said see that's
Speaker 1: interesting because having said that, you ask yourself if the
Speaker 1: President Trump, throughout the campaign, it's one has disparaged the
Speaker 1: defense spending of European nation. And if we take for
Speaker 1: fact that maybe the European military coordination is not as
Speaker 1: great as others the United States, then what is Vladiman
Speaker 1: Putin really worried about? Is it's psychological and political to
Speaker 1: deal with his own domestic issues or is there really something?
Speaker 1: What kind of threat really does the European Union militarily pose?
Speaker 1: Zero at the time being. But this is an old debate.
Speaker 1: As you remember, President Eisenhower used to say, the Europeans
Speaker 1: are playing Uncle Sam for Uncle Sucker. This is not
Speaker 1: something new that President Defense and bring umber our defense
Speaker 1: umbrella not spending adequate money. The difference is that under
Speaker 1: a NATO informal agreement that Russia the European defensemanners spent
Speaker 1: two of their GDP on defense, so only a handful
Speaker 1: of them do the United States States spends about two
Speaker 1: and a half to three pc. But what Trump is
Speaker 1: saying is differently. He is claiming that he wants the
Speaker 1: Europeans to reimburse the U S. Treasury for the U
Speaker 1: S forces in Europe and for the mutual defense treaty
Speaker 1: that we have with them. That's a significantly different thing.
Speaker 1: And nobody in Europe is going to hand money to
Speaker 1: the U S. Treasury on behalf of the U S
Speaker 1: serving as a Heshian mercenary army for the Europeans. So
Speaker 1: what Trump is worried about is the perceived efforts of
Speaker 1: Western forces to destabilize the political outcomes in Georgia and Ukraine.
Speaker 1: And there were what Western interests trying to have different outcomes,
Speaker 1: and in Georgian Ukraine, he believes those are within his
Speaker 1: sphere of influence, those are his orbit and Russia should
Speaker 1: determine the political outcomes there. So that is the primary difference,
Speaker 1: and he worries that coming across the border into Russian territory.
Speaker 1: We have yet to even discuss trade policy when it
Speaker 1: comes to Mexico and the United States. Is this a
Speaker 1: political fight that the president is after or is there
Speaker 1: really some substantive economic goal that can be achieved. The
Speaker 1: underlying issue is based on fear, which is the fear
Speaker 1: of what emerges from Mexico. I mean, he famously kicked
Speaker 1: off his campaign and June mischaracterizing the threat of rapists
Speaker 1: and ref gs and diseases, etcetera. I think trade practices
Speaker 1: are one that is just UH, the latest of an
Speaker 1: array of foreign fears if you open up NAFTA. As
Speaker 1: people who know about this much greater than I do say,
Speaker 1: it's unclear to me that the United States are going
Speaker 1: to cut a greater deal that is predictable, that is
Speaker 1: time bound, that provides the the assurances for US businesses
Speaker 1: and traders along the along the border, that will allow
Speaker 1: the US to do long term capital investments in Mexico
Speaker 1: and Mexico businesses to do trade with the United States.
Speaker 1: So I think once you start hearing from senior business
Speaker 1: leaders about the actual implications of opening up NAFTA, this
Speaker 1: administration will become much more reticent than how active they
Speaker 1: do that. I'm pim fox in for David go Our
Speaker 1: guest is Micah Zenko. He is a senior fellow at
Speaker 1: the Council on Foreign Relations UH, joining me now is
Speaker 1: uh my co host or actually I'm your co host,
Speaker 1: Tom Keen. Great to have you here at the Pierre.
Speaker 1: It's like real snow out there. It is. Michael Dart
Speaker 1: and I were going to walk over to can leisurely
Speaker 1: walk over the hold handle. Our taxicabs got us here
Speaker 1: in style. I gotta say, I thought the snow plowers
Speaker 1: were all out. Everything is good. You know the system
Speaker 1: is working. Does that work? Okay? That gives me my
Speaker 1: segue because I want to talk. I want to bring
Speaker 1: Micah Zenko. You know we talked about the system is
Speaker 1: working from your perception and your experience, and I know
Speaker 1: that you've also written a lot about drones. You've written
Speaker 1: about about military policy. Can you say that the system
Speaker 1: is working when the Press Secretary of the of the
Speaker 1: President of the United States has asked a question having
Speaker 1: to do with whether the government of Yemen has asked
Speaker 1: the United States to suspend drone strikes and you can't
Speaker 1: seem to get a specific yes or no answer. Why
Speaker 1: is that difficult? What? What is that message? Well, to
Speaker 1: be fair to the white spokesperson, he may want to
Speaker 1: be protecting whether or not the government you haven't approves
Speaker 1: these operations, there is domestic sense, it's there's domestic political
Speaker 1: sensitivities within Yemen. These are deeply unpopular operations, but the
Speaker 1: United States provides hundreds of millions of dollars over the
Speaker 1: years too. But who doesn't know that? I mean, that's
Speaker 1: like out in the media, online, social I mean, that's everywhere.
Speaker 1: Everybody knows it. And when an air strike, for example,
Speaker 1: the military even uh speaks directly to it. Well, the
Speaker 1: question is whether or not Well, when they're done by
Speaker 1: the U. S. Military, yes, we do. When they're done
Speaker 1: by the CIA, we pretend they don't. So that's and
Speaker 1: in Yemen, the CIA and the military run parallel drone programs,
Speaker 1: which is part of the confusion. So we cannot say
Speaker 1: which ones we actually do. That's the tripe. But I
Speaker 1: was going to say that the people on the ground
Speaker 1: don't care. No, they don't care who drops a bomb,
Speaker 1: including if it's the Saudi government, the American government, the CIA,
Speaker 1: or the military. You're correct, But they want to be
Speaker 1: able to maintain some distance, some degree of dissent when
Speaker 1: civilian casualties occur, as they did on the January with
Speaker 1: this raid in central Yemen. Uh So the bigger question
Speaker 1: was the spokesperson said phenomenally said, anyone who questions the
Speaker 1: success of this raid puts at risk the Navy seal
Speaker 1: who had been killed, which is quite remarkable because if
Speaker 1: you spend time with the military, they're the most critical
Speaker 1: and self honest to have their own operations. Well, I
Speaker 1: want to go back to what you wrote six years ago.
Speaker 1: This was very important at the time between threats and
Speaker 1: ward US discrete military operations in the post corld world.
Speaker 1: Your next essay in the post Trump world will be
Speaker 1: the discrete military operations of the Secretary of Defense. What
Speaker 1: are you watching for from General Maddis is he tries
Speaker 1: to bring normality to our defense and offense dialogue. Right. Well,
Speaker 1: Secretary Maddis now has a very different vision than when
Speaker 1: he was the commander of Central Command, which is the
Speaker 1: geographic area in the Middle East. The primary things that
Speaker 1: he wants to do is a share one. The homeland
Speaker 1: is secure, a shared defense systems are being protected and secure,
Speaker 1: US nuclear turrent works, and our Mutual Defense treaty allies
Speaker 1: feel comfortable. The problem is those four core missions of
Speaker 1: the U. S military are put at risk when President
Speaker 1: Trump says flipping things about nuclear weapons when he tells
Speaker 1: our tree allies, you better pay. Let me ask the
Speaker 1: question for all of our listeners worldwide, and particularly the
Speaker 1: people stuck in a snow bank on the East coast
Speaker 1: this morning, when do the adults enter the room? Well,
Speaker 1: the question is when do the adults and the presidents
Speaker 1: starts speaking on the same level. When do they start
Speaker 1: saying the same things? Because what Secretary Mattis says is calm,
Speaker 1: consistent in the US history and reassuring what has been
Speaker 1: said ince on the confirmation hearing is by Secretary Tillerson.
Speaker 1: What the White House says, uh is very different. So
Speaker 1: the question is when is the president and his candid
Speaker 1: going to speak consistently about core foreign policy messages Because
Speaker 1: they aren't yet. Well, let's just as student that they're not.
Speaker 1: Let's just assume that this is the new normal. To
Speaker 1: paraphrase Muhammad al Arian, it's the new normal in foreign policy.
Speaker 1: Take us through what you believe to be the biggest
Speaker 1: flashpoints that could erupt in the next six months. The
Speaker 1: single biggest flash point day to day is the Korean Peninsula,
Speaker 1: because that's where US and South Korean forces are prepared,
Speaker 1: as they say, to fight tonight because there could be
Speaker 1: a skirmish on the DMZ. There could be an exchange
Speaker 1: of fire which escalates to a full scale war. The
Speaker 1: U S forces have to be prepared to deter that
Speaker 1: sort of outcome. The second big one, and the most
Speaker 1: worrisome now is in the Persian Gulf because US and
Speaker 1: Iranian forces in the maritime domain there are raged so
Speaker 1: closely it's like they're in a phone booth together. They
Speaker 1: encounter each other within yards meters of each other consistently,
Speaker 1: and our National Security Advisor Michael Flynn has said that
Speaker 1: we are putting Iran on notice. They're trying to scare
Speaker 1: Iran to change its behavior. What Iran is supposed to
Speaker 1: change this behavior is unclear, and what the U S
Speaker 1: will do in responses uncertain. We need to you have
Speaker 1: a home more extundon conversation. I just put your book
Speaker 1: out on Twitter, folks, making Zenko's important book on discreet
Speaker 1: war from a number of years ago. A lot of
Speaker 1: work as well, Yeah, a lot of newer work as
Speaker 1: well with the Council on Foreign Relations. Mika Zinko, thank you, really,
Speaker 1: thank you, thank you for coming in through the snow
Speaker 1: glad to hopefully here the Pure Hotel always beautiful, but
Speaker 1: now it's your reindeers parked outside. The reindeers outside non
Speaker 1: coming down here. For all of you, drive careful on
Speaker 1: the Eastern seaboard. Bloomberg twelve hundred, Boston, Bloomberg eleven three
Speaker 1: oh in New York. We say good morning to the
Speaker 1: rest of you. Check your plane flights. Even if you're
Speaker 1: Dallas to Denver. Things could get messed up today. There's
Speaker 1: a lot of delays here, a lot of flight cancelations.
Speaker 1: Flight aware of saying that I think there were more
Speaker 1: than flight cancelations already. Michael Darda took the surveillance Sikorski
Speaker 1: to get here from Connecticut and he joins us now
Speaker 1: and then Kim, we've been talking through the morning with
Speaker 1: Mr Darta. Let's let's start with the animal spirit. Can
Speaker 1: we get nominal g d P out of a four percent?
Speaker 1: Can we get real growth plus inflation to a point
Speaker 1: where the confidence really gets restored? Well, Um, I think
Speaker 1: the answer is uh plus four percent on nominal temporarily yes,
Speaker 1: But from a longer term perspective that will really depend
Speaker 1: on whether productivity growth picks up in a meaningful way.
Speaker 1: And that's a much bigger question mark. So think of
Speaker 1: the sustainable nominal growth rate is growth potential productivity plus
Speaker 1: labor force growth. You know that's been running it just
Speaker 1: about one percent per annum over the last five or
Speaker 1: six years, plus the FEDS two percent inflation target. So
Speaker 1: we've been using a figure of three to four percent
Speaker 1: in terms of sustainable long term nominal GDP growth. Four
Speaker 1: percent being on the optimistic end, three percent more of
Speaker 1: the pessimistic side. But for figures that are well beyond that,
Speaker 1: I think we're gonna need to see a pretty hefty
Speaker 1: pickup in productivity. Hope springs eternal, but you know we'll see.
Speaker 1: Hope's not a strategy either, you know, Michael, he mentioned
Speaker 1: the two key elements, right, productivity and labor force growth.
Speaker 1: Let's take each one of the If we can labor
Speaker 1: force growth, this is a demographic change exactly based on
Speaker 1: the actual numbers that you have looked at. Does it
Speaker 1: make sense to limit or make more difficult the entry
Speaker 1: to the United States of more people who are willing
Speaker 1: to work? Great question. The answer is no, it does not.
Speaker 1: So there's a lot of optimism about whether certain reforms
Speaker 1: to you know, regulation or taxation will lift productivity. But
Speaker 1: the other part of productive potential is these low working
Speaker 1: age population growth figures just point point five pc per
Speaker 1: and I'm expected over the next few decades about a
Speaker 1: third of the post war average growth rate in a
Speaker 1: much more restrictive posture. And immigration will only and I
Speaker 1: ramplify the headwinds, you know. And I raised this not
Speaker 1: not to really bring up necessarily immigration issue, but the
Speaker 1: worker issue, because if you don't have enough workers contributing
Speaker 1: to things like social security and paying taxes, you're gonna
Speaker 1: blow a whole even a bigger hole through the federal
Speaker 1: budget exactly. And you know, one issue that we have,
Speaker 1: and it makes sense to put this in the context
Speaker 1: of what kind of tax changes can we expect. There's
Speaker 1: about a four percentage point you know of GDP increase
Speaker 1: in spending on the back of an aging population in medicare.
Speaker 1: So where is the room to move to dramatic and
Speaker 1: draconian tax cuts that you know, at least on a
Speaker 1: static basis, lose a lot of revenue. There just isn't
Speaker 1: room for that. So if you know, going for more
Speaker 1: efficiency in the code, yes, but huge unfunded tax reductions,
Speaker 1: I don't think so. Let's come back and talk about
Speaker 1: this sort of the the word that's not being set
Speaker 1: through all this is austerity, and what is the state
Speaker 1: of austerity in Europe? What is the state of austerity?
Speaker 1: Particularly within the majority Republicans on Capitol Hill. We're talking
Speaker 1: to Michael Dart about the austerity that isn't or maybe
Speaker 1: it is. Is this an austere Congress? There is? Mrs
Speaker 1: Reagan said years ago, We'll just say no, that's the mystery,
Speaker 1: isn't it. Well, that's really the pressing question, Tom. What
Speaker 1: I will say is there are a handful of Republican
Speaker 1: senators now who have expressed reservations about going down the
Speaker 1: George W. Bush path of shoehorning a tax cuts through
Speaker 1: a reconciliation process, which is essentially a stick of dynamite
Speaker 1: that blows up on a future Congress with no spending
Speaker 1: restraint in rising debt levels. But but to be clear
Speaker 1: here at the Pierre Hotel, are we not talking Reagan,
Speaker 1: but we're really talking in ethos of the governor uh
Speaker 1: and former Vice President Nelson Rockefeller. Is that really what
Speaker 1: we're reducing? Well, well, we'll have to see about that.
Speaker 1: I guess from a broader perspective, I would just say
Speaker 1: sixty vote hurdle for permanent tax changes. If we want
Speaker 1: changes in regulatory or tax policy to have an impact
Speaker 1: on sentives in productivity, they need to be permanent, not temporary.
Speaker 1: The demand side effects will end up offset by the
Speaker 1: federal reserve, So that really needs to be the focus.
Speaker 1: Is it permanent or temporary? Does it have the ability
Speaker 1: to lift incentives and productivity? And then we can move
Speaker 1: on from there. But I think at least in terms
Speaker 1: of the proposals that are out there, we'd have to
Speaker 1: expect that they'd be pretty watered down and may not
Speaker 1: even happen in some cases. We'll see what can get
Speaker 1: through the U. S. Senate. Uh, Michael Darta, you're an economist,
Speaker 1: so you get to have two opinions about this. And
Speaker 1: I want to focus on dot frank for just a moment,
Speaker 1: because this is a very important industry and you know,
Speaker 1: it has gone through the financial business has gone through
Speaker 1: a revolution in you know, the space of seven years.
Speaker 1: Let's say, is there anything that can be done that
Speaker 1: would not create huge delays from opposition and confrontation. Is
Speaker 1: there anything that can be done and let's say the
Speaker 1: next three months that would make people who are experts
Speaker 1: at making decisions on credit, uh feel like they're not
Speaker 1: being watched twenty four hours a day, seven days a
Speaker 1: week by a regulator or or someone who might uh
Speaker 1: be a right might want to be a regulator. Right. Well,
Speaker 1: perhaps I would just say, and if we're talking about
Speaker 1: Dodd Frank the Vocal Rule financial regulatory reform, the banks
Speaker 1: have put together this big wish list which looks more
Speaker 1: like roll it all back and nothing that replaces it
Speaker 1: in essence, as my friend Scott Sumner says, a return
Speaker 1: to the regulatory structure that led to the banking crises
Speaker 1: of the eighties and then the subprime meltdown. So that's
Speaker 1: probably not a viable option. Uh So we'll see what happens.
Speaker 1: Fed Chair Yelling recently said, take a look at making
Speaker 1: you know, some of the reforms more efficient and effective.
Speaker 1: That's quite different than a wholesale roll back with nothing
Speaker 1: to replace it. And you could actually go down the
Speaker 1: same path of reasoning for the A. C. A. Obama here,
Speaker 1: you know, repeal and replace, what replaces it? What are
Speaker 1: the effects if you end up with millions of people
Speaker 1: losing coverage? At least you end up with a political
Speaker 1: bomb exploding, and so you know, both with regulatory reform
Speaker 1: and the A C. A. I'm waiting with bated breath,
Speaker 1: bated waiting with bated breath on the on the Fed,
Speaker 1: how many interest rate increases this year and when market
Speaker 1: expects to dot plot is looking for three? My guests
Speaker 1: would be three in the last three quarters of the years.
Speaker 1: You get there with your nominal GDP call, well, I
Speaker 1: get there this way. That was just under four, right,
Speaker 1: He was saying, what was the point, I think we're
Speaker 1: going to be over for this year, But he said
Speaker 1: on the trend, Yeah, the trend is going to be
Speaker 1: three to four. In my opinion, if growth potential is
Speaker 1: running between one and two and you are being generous there,
Speaker 1: four's jet four sustained for is generous. So I think
Speaker 1: with the recovery and credit markets that's taken place over
Speaker 1: the course of the last year, and the bump up
Speaker 1: and inflation expectations in the improvement in the labor market,
Speaker 1: the FED will be able to to lift rates gradually
Speaker 1: this year without throwing the business cycle off of a cliff.
Speaker 1: So two to three I think is reasonable. Um, And
Speaker 1: you know, we know that the futures markets aren't looking
Speaker 1: you know, probabilities very low for March, so it would
Speaker 1: have to be more back end loaded if they're going
Speaker 1: to do three. But I thought everybody who I thought,
Speaker 1: I think all the labor reports have been saying that
Speaker 1: labor markets are tight that you know, in fact, it
Speaker 1: was a mismatch, right, something like five point five million
Speaker 1: openings for four point six million unemployed, So wage pressure,
Speaker 1: I mean, really only three. Is there anybody out there
Speaker 1: who you think who says four rate increases this year? Uh,
Speaker 1: it's uh, I'm sure that there's somebody calling for that.
Speaker 1: But the issue is the FED would already have to
Speaker 1: be guiding markets to a March rate. Rice is going
Speaker 1: to do one per quarter, and they didn't take the
Speaker 1: occasion of the last meeting to do that at all.
Speaker 1: In the state. Given the guilded age that we're living
Speaker 1: or that is personified by our new president, Janet Yellen
Speaker 1: as protector in her mind of a lot of other Americans,
Speaker 1: is going to continue to focus on slack in the
Speaker 1: economy in a bimodal America to America's She's got to
Speaker 1: pay attention to the part of America that's not enjoying
Speaker 1: full employment right and she has. You know, I think
Speaker 1: will she continue though that's the question. As long as
Speaker 1: she's there, um, you know, you'll have a federal reserve
Speaker 1: that cares about the dual mandate. And we've essentially, at
Speaker 1: least according to the FED, reached the full employment part
Speaker 1: of the mandate, or are very close. Unemployment rate has fallen,
Speaker 1: essentially to the Fed's calculation of the natural rate, the
Speaker 1: rate that sustainable over the long haul. The broader measures
Speaker 1: of under employment, like the U six rate, not quite there,
Speaker 1: but pretty much as close as we've been since the
Speaker 1: recovery started, almost so we're much closer in The wage
Speaker 1: growth figures are modest, but you know, two and a
Speaker 1: half percent hourly earnings growth up from about a two
Speaker 1: percent trend or just above two and a half is
Speaker 1: also consistent with a labor market that is closer to
Speaker 1: full health. Keep in mind that the nominal wage figures
Speaker 1: add or above four percent towards the tail end of
Speaker 1: the last two business cycles. Probably that's out of reach.
Speaker 1: We really shouldn't expect nominal wage growth much above the
Speaker 1: sum of productivity, and the FEDS inflation target. Productivity has
Speaker 1: been sub one the FEDS inflation target is too, so
Speaker 1: two and a half to three, you know, might not
Speaker 1: be outside the orbit of what we can expect. And
Speaker 1: we're pretty close to that now on on wages. So
Speaker 1: from the perspective of normalization, we might be getting closer.
Speaker 1: You have an outlook if this is the peak. If
Speaker 1: I was to say this is as good as it
Speaker 1: gets right now, well if you just look at the
Speaker 1: unemployment rate, you know, and and to bring this into
Speaker 1: uh well it last quarter it was it was better.
Speaker 1: We'll have to see. I mean, you want to smooth
Speaker 1: out the jumping numbers. The average of the last five
Speaker 1: or six years has been seven tenths of a percent
Speaker 1: per annum. Hopefully we move up to the ten year average,
Speaker 1: which is just over one. Even if that's the case,
Speaker 1: you know, my range in terms of long run nominal
Speaker 1: growth of three to four is still where we are. Michael,
Speaker 1: I hope you enjoy the presidential suite here at the
Speaker 1: Pier Hotel. Anybody coming out today's so don't you think, pim,
Speaker 1: why not get you know what, or maybe he gets
Speaker 1: a shovel two. You don't need to go to the gym.
Speaker 1: You just need to, you know, put a little backbone
Speaker 1: into it right. Good workout, Michael d Thank you so
Speaker 1: much for coming out. Brought you by Bank of America,
Speaker 1: Mary Lynch. Dedicated to bringing our clients insights and solutions
Speaker 1: to meet the challenges of a transforming world. That's the
Speaker 1: power of global connections. Mary Lynch, Pierce Feerin Smith Incorporated,
Speaker 1: Member s I p C One, Dennis Gartment Dennis, good morning,
Speaker 1: Good morning Tom. Within the struggle in the cacophony of
Speaker 1: uncertainties plural that we have right now, how do you
Speaker 1: distill all this when you were there at four am,
Speaker 1: three am writing your acclaimed morning letter, where is your
Speaker 1: focal point? What is the uncertainty you choose to look at?
Speaker 1: You know that? What a great question and and the
Speaker 1: answer is, I really don't know. The answer is there's
Speaker 1: always something to talk about, there's always something to write about.
Speaker 1: And perhaps it's just because I've been at it for
Speaker 1: forty years, the things that really are important seem to you,
Speaker 1: seem to make their way to de sive that is
Speaker 1: my my mind and say this is the thing this
Speaker 1: morning that I want to talk about. This is what's important.
Speaker 1: I start by writing, first of all, the first thing
Speaker 1: I look at when I arise at one am, is
Speaker 1: what has the foreign exchange market done overseas? I'll always
Speaker 1: look at the forex market first. Then I'll go around
Speaker 1: to various pages on the net or newspapers that come
Speaker 1: in or a news wires that I have, and see
Speaker 1: what what small piece of information UH politically has has
Speaker 1: developed that has made its way from page thirty two
Speaker 1: two weeks ago two is making its way to page
Speaker 1: two or three, and eventually shall make its way to
Speaker 1: page one. So it's a matter of sifting through the
Speaker 1: minutia and saying, this to me looks to be important.
Speaker 1: And here I hold it out to you. Take a
Speaker 1: look and see if you think this is important also,
Speaker 1: And this is what I think it means. So, Dennis,
Speaker 1: what's on page thirty two right now? We want two
Speaker 1: steps ahead? What's on page thirty two right? And then
Speaker 1: I guess something that has been that used to be
Speaker 1: back on page thirty two and every once in a
Speaker 1: while makes it to page one recently and then goes
Speaker 1: back to page two or three. Is those circumstances prevailing
Speaker 1: between China and the United States in the South China. See,
Speaker 1: I can remember when I started writing about that a
Speaker 1: decade ago that no one paid attention. Now everybody does.
Speaker 1: But I don't think enough attention is really being paid
Speaker 1: to what has transpired. Secondly, what's on page five. There's
Speaker 1: not that many things on page thirty two anymore. Now
Speaker 1: it's on page five and making its way to page one.
Speaker 1: Is the concern everywhere about the United States and trade protection,
Speaker 1: and I don't think enough people are paying enough attention
Speaker 1: or giving that enough importance. Well, let me propose a
Speaker 1: page thirty two if if I might um. One of
Speaker 1: the big issues that China has no matter what is
Speaker 1: the availability of potable water. And this is something that
Speaker 1: has not garnered a lot of attention, but the Chinese
Speaker 1: government knows very well that you must have potable water
Speaker 1: available to a growing population. That water typically exists that
Speaker 1: they can have access to. In Russia, uh, we've seen
Speaker 1: in the West has always reacted to any combination of
Speaker 1: Russia and China. But given a new Trump administration, I'm
Speaker 1: wondering if you could comment on is it possible that
Speaker 1: though that relationship between the three countries changes over the
Speaker 1: next four years. Oh, I don't think there's any question
Speaker 1: that that the relationship between the United States, Russia and
Speaker 1: China changes over the course of the next two weeks,
Speaker 1: over the course of the next two hours. That relationship
Speaker 1: is always changing, and clearly it's the most important relationship
Speaker 1: and relationships in the world today, the important. What's interesting
Speaker 1: is you bring up the concept of water. Water is
Speaker 1: at the basis of almost all political dissension in the world.
Speaker 1: In in the Middle East, it's really a water problem.
Speaker 1: Where does the water come from? Does it flow down
Speaker 1: the various rivers, doesn't make it to the ocean? Can
Speaker 1: it be used? Can it be changed? Can it be
Speaker 1: forced bed? Yeah? I mean it's it's a very water
Speaker 1: is central and U your your point about water between
Speaker 1: China and Russia is something quite honestly, I have not considered.
Speaker 1: I shall now spend some time thinking about that. That's
Speaker 1: a fascinating topic. Dennis. Let me get some advice on
Speaker 1: this equity market. It has been brutal. Hedge funds really
Speaker 1: struggling every one time. Keen struggling, Dennis, carbon struggling. You
Speaker 1: were in about chapter eight of Reminiscence of a Stock
Speaker 1: Operator from a few years ago, and we're great in
Speaker 1: cardinal rules of that classic book. Think folks, the thirties.
Speaker 1: Is the idea when there's no trend, just stop doing
Speaker 1: this and get out of the way. When do you
Speaker 1: know in a listless trend to act, Uh, The first
Speaker 1: thing I'll look at is what are the charts telling me?
Speaker 1: Many of your listeners are going to find this amusing
Speaker 1: and stupid, but I think there's wisdom here. Is the
Speaker 1: market moving from the lower left to the upper right.
Speaker 1: Is the market moving from the upper left to the
Speaker 1: lower right. Are the highs higher, are the lows higher?
Speaker 1: Or are the high is lower and the lows lower?
Speaker 1: Can can trend lines be drawn? Sometimes it's not simple.
Speaker 1: Sometimes you need to put the chart on the wall,
Speaker 1: stand twenty five ft away from it, and ask your
Speaker 1: four year old nephew Tommy, which way is this moving?
Speaker 1: Sometimes looking at a market through the eyes of a
Speaker 1: four year old makes more sense. As as the Great
Speaker 1: Turkey said in in Reminiscences of a Stock Operator, after
Speaker 1: all it is still a bull market. And after all,
Speaker 1: in the case today, it is still a bull market.
Speaker 1: The markets still move from the lower left to the
Speaker 1: upper right. I find myself fighting at many times, and
Speaker 1: almost every time I do, it's proven to be wrong.
Speaker 1: It's still a bull market. When does it end? Write
Speaker 1: this down. It shall end. When it ends, it will
Speaker 1: end in a moment before then. That's what I've learned. Well,
Speaker 1: you've learned a lot, and we always appreciate your sharing
Speaker 1: it with us. So let me pose to let me
Speaker 1: pose this. Do you given that that you know money
Speaker 1: can be sticky depending upon how liquid it is, of course,
Speaker 1: and disruption of markets and all those great things, build
Speaker 1: that into a program for what to do. If you
Speaker 1: believe that history might not repeat itself, but that it rhymes,
Speaker 1: what do you do well in this case? I mean,
Speaker 1: first of all, that's I've always liked that line, because
Speaker 1: history does repeat itself, and more often than not, when
Speaker 1: it doesn't, it does indeed rhyme. The similarities between today
Speaker 1: and what happened forty years ago and what happened a
Speaker 1: hundred years ago are startling, startlingly the same. What's what's
Speaker 1: going on right now? Well, I think fundamentally we have
Speaker 1: to understand that the monetary authorities in Japan and in
Speaker 1: Europe are are still expansionary, while the monetary authorities here
Speaker 1: in the United States, if not already contractionary, are certainly
Speaker 1: leading in that direction. What does that mean. It means
Speaker 1: on balance, stock prices in Japan and Europe may well
Speaker 1: do better than stock prices here in the United States.
Speaker 1: It certainly means that the dollar will do better because
Speaker 1: less of them are being created, and that the row
Speaker 1: and the yen will probably weaken on balance, And it
Speaker 1: probably means that in terms of the euro, in the end,
Speaker 1: gold will probably rise. That's probably what all. That's probably
Speaker 1: what I can put my arms around and believe, Dennis,
Speaker 1: I'm gonna put a fancy chart out here. Haven't had
Speaker 1: a time to make it up yet. On Twitter of
Speaker 1: Dennis Gartment owning golden dollars or euros or some other
Speaker 1: beleaguered currency, you look like a genius hedging gold in
Speaker 1: foreign exchange. Should we hedge our equity holdings like we
Speaker 1: hedge gold in other currencies? Well, a very good question.
Speaker 1: First of all, let's talk about the gold in US
Speaker 1: dollar terms, in the nonsense terms, we'll get to the
Speaker 1: idea of hedging UH equity exposure. You have to understand it.
Speaker 1: When you own gold in dollar terms, you have effectively
Speaker 1: taken a short position in the US dollar. And I
Speaker 1: don't think in the current environment that one wants to
Speaker 1: be short of the dollar. We are by death of mission.
Speaker 1: If you believe that the adjusted monetary basis the stock
Speaker 1: from which all soups of the broad monetary aggregates are derived.
Speaker 1: If you believe that, and I do well, Actually, the
Speaker 1: supply of dollars in the world is declining rather dramatically
Speaker 1: over the course the past fifteen months. On the other hand,
Speaker 1: the monetary authorities in Europe and in Japan are continuing
Speaker 1: their experiment with quantitative easing. In that environment, you would
Speaker 1: much rather own gold in the terms of the currencies
Speaker 1: that are being created, rather than in terms of the
Speaker 1: currency that is that is disappearing in dollars are in
Speaker 1: fact disappearing. If that holds true, then perhaps it is
Speaker 1: wise if you own for if you are long of
Speaker 1: equities elsewhere and you are a dollar buyer, when you
Speaker 1: have bought Japanese securities, for example, you have effectively sold
Speaker 1: short the dollar. Perhaps you should head to that dollar exposure.
Speaker 1: There are times when it is wise to do so.
Speaker 1: There are times when when it is pat tacitly unwise
Speaker 1: to do so. And right now I think if you
Speaker 1: are effectively taking a position short of the US dollar,
Speaker 1: you're on the wrong side. You want to head to
Speaker 1: that risk away. So the answer to your question is yes, yes,
Speaker 1: they're okay. Well that was an answer. I like that then,
Speaker 1: as because I was going to challenge a little bit
Speaker 1: on the bull gold because uh, I just don't understand
Speaker 1: I mean, I understand the thesis, but it has no
Speaker 1: value other than the value that people place on it.
Speaker 1: I mean, it has no connections him. I won't argue
Speaker 1: that the gold is clearly a psychological circumstance under most events.
Speaker 1: Under most and I see because well, that's this th
Speaker 1: thing is that under those events the government closes the
Speaker 1: gold window and makes it impossible for you to actually
Speaker 1: access your gold anyway, or whatever, or some kind of
Speaker 1: scenario like that. What is the scenario? What what is
Speaker 1: the state of the world in which that gold call
Speaker 1: ends up being correct? Uh, the state of the world
Speaker 1: in which that gold call being correct is the same
Speaker 1: state of the world that has existed for the past
Speaker 1: two years or so. As I said, dollars are being diminished,
Speaker 1: euros and yen are being created in that environment, which
Speaker 1: is probably going to be at least I think we
Speaker 1: are now in the post deflation era. I'm not sure
Speaker 1: we're in the inflationary era, but I think we're certainly
Speaker 1: in the post deflationary era. In those circumstances, with the
Speaker 1: monetary authorities being expansive in Europe and end, why would
Speaker 1: you not wish to own at least some gold? And
Speaker 1: clearly the market has told you that's the right thing
Speaker 1: to do. That's perhaps the most important circumstance of all.
Speaker 1: The market has said by its vote, you're right in
Speaker 1: doing so, and I'll continue to do it until the
Speaker 1: market tells me that I'm wrong. At twelve announce, well
Speaker 1: at twelve forty announced. In US dollar terms, I'm ambivalent
Speaker 1: to gold given, but again, I really don't care about
Speaker 1: golden dollars in dollar terms. I care about gold in
Speaker 1: yen and Euro terms, and in both of those terms,
Speaker 1: gold has been an unprotracted bull market for four years
Speaker 1: and continues to be so. Dennis, I thank you so much.
Speaker 1: I just want to tell you, Dennis, I've come up
Speaker 1: with a great chart that shows the Gartman euro gold trade.
Speaker 1: And the only reason I'm putting this out on Twitter, Dennis,
Speaker 1: is not so you can see it or Doug cast
Speaker 1: can see it. The one time a day he goes
Speaker 1: out on Twitter but I want the President of the
Speaker 1: United States to see golden euro terms. Maybe he'll subscribe
Speaker 1: to the Gartment letter. You know he won't because he
Speaker 1: gets taken the task too often in my news letter.
Speaker 1: Well that would be true too, Dennis Gartman, thank you
Speaker 1: so much for perspectives. Oh it's just amazing the outperformance
Speaker 1: of golden euro terms from the financial crisis in particularly
Speaker 1: in the last three years. I just could not be
Speaker 1: better at time. Oliver Channon writes piercing notes for Cowen
Speaker 1: on the state of fashion. He will write on Macy's
Speaker 1: and the huge challenge that Fortress Londren is having. He
Speaker 1: will write on some of the specialty retailers. Oliver, I
Speaker 1: thought the New York Times hit the ball out of
Speaker 1: the park today with their kickoff New York Fashion Week
Speaker 1: piece the challenges of the business, the challenges of celebrity.
Speaker 1: But all of this is the challenges of the consumer.
Speaker 1: It's a new consumer. Help Vanessa Friedman and all the
Speaker 1: other people wired into this in New York City, in London,
Speaker 1: around the world. Who's getting it right right now? Who
Speaker 1: is meeting the customer challenge best right now? Well, the
Speaker 1: customer challenges are quite eclectic so who's getting it right?
Speaker 1: I would say deep value. You think about ros stores,
Speaker 1: t j X, mixing and matching, the customer is no
Speaker 1: longer loyal or once a specific headset toe look of
Speaker 1: a brand. That's trouble for Macy's. I'm going to suggest
Speaker 1: that the luxury crew don't darken the door of t
Speaker 1: j X. That, you know, let's let's let's start with
Speaker 1: that assumption. Is anybody getting it right up scale or
Speaker 1: is it such a free for all? Is Vanessa and
Speaker 1: the good people at the Times captured today that you
Speaker 1: don't know. Vanessa doesn't know, Robert Burke doesn't know. No
Speaker 1: one knows really where where luxury is going. Well, there
Speaker 1: are certain aspects of luxury that are working. We're recommending Southby's,
Speaker 1: we are recommending Tiffany and Company as well. I would
Speaker 1: say luxury apparel is where there's been more problems, and
Speaker 1: I think the rise of Amazon, the rise of mobile
Speaker 1: price comparison, as well as great alternatives and apparel is
Speaker 1: really negatively impacting that business. Merchandise, margins and apparels under
Speaker 1: a deflationary pressure, you know all One of the things
Speaker 1: that happens at breakfast is where you like really reveal
Speaker 1: the details secrets of what goes on in an industry.
Speaker 1: And we're not that far from the flagship store of
Speaker 1: Ralph lauren which just lost its chief executive. Um. Also,
Speaker 1: I believe that just across the street that Tiffany losing
Speaker 1: its chief executive. Could you explain what is going on
Speaker 1: at that higher ranks of these companies. Yeah, there's a
Speaker 1: revolution going on in retail, end of transformation. So what's
Speaker 1: happening here is there's a real problem malls are over developed. Also,
Speaker 1: No, no no, no, I know that. I know that, but
Speaker 1: do you can for example with Ralph Laurence, right, can
Speaker 1: you do you know why? Uh that did not work out?
Speaker 1: I think when you think about what's happening here is
Speaker 1: a struggle in terms of thinking about creative versus business
Speaker 1: and how to maximize profits in the context of this stress.
Speaker 1: But the department store problems are very relevant because a
Speaker 1: lot of these companies that's their most significant customers. No, no no,
Speaker 1: I know that, but I just meant like, why this,
Speaker 1: you know, why the CEO left or why the CEO
Speaker 1: of Tiffany, Because it's all about the people. It is
Speaker 1: about the people, and there's different philosophies on the management
Speaker 1: execution in terms of stars versus process versus heritage. So
Speaker 1: we're in a time of stress with pressure, and I
Speaker 1: think creative direction um can be quite controversial as brands
Speaker 1: need to reinvent themselves. The biggest issue is speed and
Speaker 1: supply chain. So a lot of these companies have to
Speaker 1: be totally transformed in terms of really rethinking how quickly
Speaker 1: they get products to market. And what you do is
Speaker 1: you look great today, by the way, you got the
Speaker 1: whole He's got the whole New York Fashion Week. Look going, folks.
Speaker 1: It's not made for TV. You can only take it
Speaker 1: in on radio. But but Oliver, when when I look
Speaker 1: at the state of fashion, it's still about Meryl Street,
Speaker 1: the double Wares, product aspiration or have our aspirations changed?
Speaker 1: And everybody that may put's clothes on is has to
Speaker 1: adapt to them. They have changed because the consumer has
Speaker 1: more power. Now you think about Instagram, you think about
Speaker 1: social media, trends come from the bottom, not the top.
Speaker 1: Now it's basically there's more power. There's more democratization of
Speaker 1: fashion as well. I mean, you give an idea Javan,
Speaker 1: She's guy is gone, He's at Versace you mentioned Tiffany's gone,
Speaker 1: Ralph Lauren gone. I mean it was just Oliver quickly
Speaker 1: here and we'll come back just more of this. Probably
Speaker 1: given the rise of Amazon, given the problems of stores,
Speaker 1: given profits under pressure, there's a lot of pressure to
Speaker 1: change in demand and reinvent. So it retails about reinvention,
Speaker 1: surprise and delight. Out with the old and with the new.
Speaker 1: Everybody's trying out retail now. There's a lot of common themes,
Speaker 1: the death of them all, etcetera, etcetera. Are you so
Speaker 1: underweight your world that essentially it's a cash investment or
Speaker 1: can there be opportunity? We do think there's some great
Speaker 1: long term opportunities such as Costco. We like Walmart as well.
Speaker 1: We do like the off price sex or t j
Speaker 1: X and rob and luxury goods, luxury goods at the
Speaker 1: high end. Think about Southebys and Tiffany. We think they're
Speaker 1: long term defensible and Tiffany are financially how can they
Speaker 1: be good? Is there? I mean can they even do
Speaker 1: but can they do even new level revenue growth? That
Speaker 1: is an opportunity. So we see an inflection happening over time.
Speaker 1: What they really need to think about is or traffic.
Speaker 1: Also continued product assortment and innovation, So they need to
Speaker 1: bring people back in the store, not just you buying
Speaker 1: a gift. They need to bring the woman really desiring
Speaker 1: product there. So as they balanced the two in terms
Speaker 1: of self purchasing and gifting, that's an opportunity. The first
Speaker 1: lady help, she was carrying the light Blue Box. I mean,
Speaker 1: it's an iconic brand, The Blue Box matters. Well, I
Speaker 1: just let me just give you the most recent background, right,
Speaker 1: which is that the CEO basically got fired. Right, Michael
Speaker 1: Kowalski has taken over as the UH. The interim chief
Speaker 1: executive Frederick Kuminal had been there I think since April
Speaker 1: of and UH sales declines in Europe. They also talked
Speaker 1: about the sales declines in the United States, but also
Speaker 1: stepped up security for their very you know, for their
Speaker 1: flagship store. But they mentioned very specifically that Tiffany has
Speaker 1: been cutting costs, rolling out new products, and increasing it's marketing,
Speaker 1: but that the company needs to move faster. So what
Speaker 1: what do they need to do faster? They need to
Speaker 1: move faster in line with what consumers really want. So
Speaker 1: consumers are shopping in all places for jewelry and the
Speaker 1: younger customer, the middle customer really needs to desire products,
Speaker 1: so it's product, it's marketing, its stores moving faster. A
Speaker 1: lot of the stores look like they did at Breakfast
Speaker 1: and Tiffany's the movie, so you really think about wonderful
Speaker 1: store experience that's not just cabinets. It doesn't need to
Speaker 1: look like a bank, but it needs to look sexy,
Speaker 1: a more modern store. Uh footprint, it's part of the formula.
Speaker 1: But customers are about I want what I want when
Speaker 1: I want it, So think about online, think about gift thing,
Speaker 1: think about buy online, pickup in store, think about ship
Speaker 1: from store, and then the renovation of the assortments. So
Speaker 1: Tiffany t Tiffany Atlas returned to Tiffany. They really need
Speaker 1: to be sexy, so it's got to be about desire.
Speaker 1: But Tiffany sells plenty of bridal jewelry so people will
Speaker 1: always get married. They own a polishing facility in Botswana.
Speaker 1: They have off Tick Diamond agreement. So as you think
Speaker 1: about the world of investing, you want to own stocks
Speaker 1: that have this kind of base safety as well. And
Speaker 1: there's not a lot of combs that are well known
Speaker 1: that was The reason I brought that up is the
Speaker 1: stock got hit because the CEO left. Turn I want
Speaker 1: to go the other direction. Sally Beauty dent in Texas.
Speaker 1: What's happening? Are issues happening Sally Beauty? Her hair is
Speaker 1: not so beautiful right now? I think what's happening There
Speaker 1: is a lot of increased competition. Tell Tom about the
Speaker 1: company for Sally Beauty, It's not exactly the tech Relief.
Speaker 1: It's a lot different. It's it's a lot of employees.
Speaker 1: They do and they have leading market share and hair
Speaker 1: care um. It's it's a great destination if you need
Speaker 1: to enhance your hair, and it's also had very loyal customers.
Speaker 1: Off of all just to go local here, Good morning, Bloomberg,
Speaker 1: eleventh three in New York. What's your prescription to resurrect
Speaker 1: New York Fashion Week? New York Fashion Week will continue
Speaker 1: to evolve, So I think it's, you know, fashion has
Speaker 1: to continue to get fun. It's very somber, but a
Speaker 1: lot of the designers are really speaking to the reality
Speaker 1: of culture and what we're seeing now. But but you know,
Speaker 1: it's you know, I don't. I think it's it's great
Speaker 1: that it exists and there's a lot of excitement, but
Speaker 1: it will continue to evolve. You know, New York as
Speaker 1: a as a cultural destination at you know, you think
Speaker 1: about Europe, there's a lot more sutorial heritage. However, men
Speaker 1: are the new women. We've been wearing. We've been wearing
Speaker 1: clothes for a long time. Yeah, I don't know. I
Speaker 1: you know, my basic tickets. Rebecca Minkoff went to Los Angeles, right,
Speaker 1: I mean the l a lifestyle. Help me, Rebecca Minkoff.
Speaker 1: Simon's is showing here in New York. That's a big show, right,
Speaker 1: Kelvin Klan is a big show. Yeah. I've lapped myself.
Speaker 1: I've laughed myself. That's exactly what Mr Simmons has to do,
Speaker 1: is right, exactly. We got to talk about track suits
Speaker 1: because track suits are really end now as well as
Speaker 1: bomber jackets. There's a lot of flowiness we should be.
Speaker 1: This is the Oliver chenn we know in thet folks.
Speaker 1: Tomorrow I'll be wearing a track suit with David Girl.
Speaker 1: Oliver chen Thank you so much with cowed greatly greatly
Speaker 1: appreciate it. Thanks for listening to the Bloomberg Surveillance Podcast.
Speaker 1: Subscribe and listen to interviews on iTunes, SoundCloud, or whichever
Speaker 1: podcast platform you prefer. I'm out on Twitter at Tom Keene.
Speaker 1: David Gura is at David Gura. Before the podcast, you
Speaker 1: can always catch us worldwide. I'm Bloomberg Radio, brought you
Speaker 1: by Bank of America Mary Lynch. Dedicated to bringing our
Speaker 1: clients insights and solutions to meet the challenges of a
Speaker 1: transforming world. That's the power of global connections. Mary Lynch, Pierce,
Speaker 1: Fenner and Smith Incorporated, Member s I p C.