Speaker 1: This is Bloomberg Business Week. I'm Carol Masser and I'm
Speaker 1: Jason Kelly. We're right here every day bringing you the
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Speaker 1: Bloomberg Business Week. Jason Kelly and Scarlet Food here with
Speaker 1: you on a Friday, and as we do on most Fridays,
Speaker 1: certainly the Friday's that we like the most, we check
Speaker 1: in with Ian LUs Bader. He is a doctor and
Speaker 1: Clinical Associo Professor of Medicine at n y U Lane
Speaker 1: Gones Medical Center, joining us on the phone from New
Speaker 1: York City. Ian, It's always a treat to catch up
Speaker 1: with you, and I do want to thank you, as
Speaker 1: I always do, or as I always think I should
Speaker 1: uh for all your good advice and council throughout this pandemic.
Speaker 1: You've really been a valuable voice to us and we
Speaker 1: really appreciate it. Very kind. Thanks, and it's great to
Speaker 1: be with you, and it's great to try and contribute
Speaker 1: to some knowledge and understanding of a of a challenging area.
Speaker 1: And welcome Scarlett, and always good to speak to you. Jason.
Speaker 1: So where are we right now? I mean here we are.
Speaker 1: It's the end of July, the last day of July. Here.
Speaker 1: I think back to the conversations that we've had over
Speaker 1: these months, and while the overall picture doesn't seem great,
Speaker 1: certainly nationally, I feel like if you went but if
Speaker 1: we went back and told ourselves in you know, our
Speaker 1: sort of may selves are April selves, certainly this is
Speaker 1: where we'd be in New York City and its environs,
Speaker 1: we we'd probably feel pretty good about this. I agree.
Speaker 1: I think certainly the northeastern New York has made great strides,
Speaker 1: and it does look like they're there were waves passing
Speaker 1: through the rest of the country, but certainly in the
Speaker 1: northeast here New York. Back in Uh, March and April
Speaker 1: was a ghost town, and hospitals were overloaded. The entire
Speaker 1: medical centers were really overrun, completely overrun with COVID patients
Speaker 1: and and regular medical care was not really being done.
Speaker 1: This was some of the issues that Dr Faucian Redfield
Speaker 1: addressed today and the congressional hearings, and much regular medical
Speaker 1: care was not being done. Uh. And there were probably
Speaker 1: a number of deaths that we could attribute not to
Speaker 1: COVID but for people just being either afraid to come
Speaker 1: in or not coming in. And I think one of
Speaker 1: the big issues as we have had cases drop, at
Speaker 1: least in the Northeast, is you know, reopening and getting
Speaker 1: back to school, and and a lot of that was
Speaker 1: addressed by Faucci and Redfield too, with the challenge of
Speaker 1: teachers and students um needing and wanting to some degree
Speaker 1: to get back, but also some fear about that as well.
Speaker 1: You described it as a ghost town back in March
Speaker 1: and April. I would argue it's still kind of a
Speaker 1: ghost town. I come into the city every day and
Speaker 1: just outside of the office there are cars, but not
Speaker 1: that many, and there are very few people wandering around.
Speaker 1: Once people do come back, we know a lot of
Speaker 1: people fled town. They've gone to summer homes, the Hampton's
Speaker 1: or just outside of New York once they start to
Speaker 1: come back because of school, because things are starting to normalize.
Speaker 1: What kind of pick up in the infection rate do
Speaker 1: you think we might anticipate or am I getting ahead
Speaker 1: of myself here, If we take the proper precautions, maybe
Speaker 1: we won't get a pick up. Well, I think that's
Speaker 1: a very fair question, Scarlet, And to me, certainly, I've
Speaker 1: been in the office every day since January and looking
Speaker 1: out the window and walking down the streets. It's definitely busier.
Speaker 1: I agree we're not back up to sort of our
Speaker 1: baseline frenzy in Manhattan, but certainly dramatically busier. And I
Speaker 1: think it's unclear getting back to the office and getting
Speaker 1: back to school. But I would echo what Fauci and
Speaker 1: red Field um talked about, which were really sort of
Speaker 1: those five principles. You know, if people wear masks and
Speaker 1: avoid crowds, doing reasonable social distancing, which not every office
Speaker 1: has easily available, people will have to perhaps reconfigure a
Speaker 1: bit handwashing, avoiding yelling and uh loud speaking, in other words,
Speaker 1: aerosolizing potential viral particles. I think we can reasonably get
Speaker 1: back to business. Um. There will have to be some accommodation,
Speaker 1: certainly in school. That may be smaller classrooms or alternate days,
Speaker 1: or we're hybrid learning. But overall, I think we can
Speaker 1: do that, and I think we should do that. You're right,
Speaker 1: there may be some pick up. We haven't really seen
Speaker 1: that yet. We will know, unfortunately by increased hospitalizations, but
Speaker 1: at this point it seems certainly very safe to let
Speaker 1: people back to a more normal life. Ian. What's the
Speaker 1: most important headline in your estimation this week when it
Speaker 1: comes to either therapeutics or vaccines. What did you learn
Speaker 1: this week that we need to go into the weekend
Speaker 1: thinking and talking about. Well, I think we're seeing uh,
Speaker 1: incremental um progress really in a variety of fronts. And
Speaker 1: that is the articles have come out about the origin
Speaker 1: of COVID nineteen, which I don't think necessarily changes our
Speaker 1: treatment at this point, but it does look genetically like
Speaker 1: this really did originate in bats, and uh, that's sort
Speaker 1: of off the radar for most of us. We don't
Speaker 1: really think about that, but it does highlight that there
Speaker 1: are some changes like wet markets and so forth that
Speaker 1: probably we're really uh the source of this, although there's
Speaker 1: still some questions about you know, virology lab or or
Speaker 1: or potentially a lab leak, but it does seem at
Speaker 1: least based on some studies, that this really did originate
Speaker 1: as a as a virus and bats and whether or
Speaker 1: not modification or other things occurred. UM. In addition, there
Speaker 1: was a recent article on masks. This did exclude the US,
Speaker 1: but in many other countries there was an observational study
Speaker 1: that really showed people who wear masks have a much
Speaker 1: lower incidence of touching their face and that seems to
Speaker 1: be a significant contributor to reducing the spread. While we're
Speaker 1: waiting for more therapeutics like monoclonal antibodies which also have
Speaker 1: a lot of UM promise in addition to vaccines, and
Speaker 1: we're also making progress on the vaccine front, you know,
Speaker 1: phase three trials thirty patients, and I'm very optimistic about
Speaker 1: that Faucia is and what you was involved in one
Speaker 1: of those studies, UM, and I think for sure by
Speaker 1: December January, probably February at the latest, will really have
Speaker 1: a vaccine that has been tested and hopefully should be safe.
Speaker 1: And then we have to see what people take it.
Speaker 1: That will be It's a huge question. All right, stick
Speaker 1: with us, Dr Ian LUs Bader. We've gotten more to
Speaker 1: talk about, including sports. We want to get your take
Speaker 1: on a lot of headlines Scarlet and I have been
Speaker 1: following when it comes to Major League Baseball, especially as
Speaker 1: sports get underway. Kind of, let's get back to our
Speaker 1: conversation with Dr Ian LUs Bader from ny us lingun
Speaker 1: Medical Center. So, Ian, talk to us about sports. You've
Speaker 1: seen the same headlines we have, especially especially excuse me,
Speaker 1: around major League baseball. How worried are you that we're
Speaker 1: not going to see a full baseball season here? Well,
Speaker 1: everyone is concerned about how to safely get back to
Speaker 1: normal activities, whether it's the office, whether it's you know, patients,
Speaker 1: whether it's sports. Uh, and it's unfortunately going to be
Speaker 1: somewhat imperfect. Fortunately, baseball in sports is important. It's not
Speaker 1: necessarily an essential service, but people really do need it
Speaker 1: to relax and unwind and really take their mind offul
Speaker 1: lot of the stresses and strange. So there are a
Speaker 1: variety of approaches that we use for testing. One, patients
Speaker 1: may come in and say, look, I was sick two
Speaker 1: weeks ago, or three weeks ago or a month ago, Uh,
Speaker 1: did I have COVID? We do an antibody test, and
Speaker 1: if it's positive, that's pretty assuring. Now, those antibodies do
Speaker 1: drop off over time, so if someone says five months
Speaker 1: ago I was sick, a negative antibody test really is
Speaker 1: not that helpful. And we also do swab tests or
Speaker 1: other tests that really detect whether the virus is present
Speaker 1: in the nose or in the far yanx, or is
Speaker 1: it communicable, And those can be helpful to test before
Speaker 1: you travel, before you come back to work, before you
Speaker 1: play in a sports game. Now, again, you can have
Speaker 1: people who are asymptomatic feel fine and harbord the virus.
Speaker 1: A number of young, healthy people do that, so uh.
Speaker 1: And of course baseball is not necessarily a high contact
Speaker 1: sport unlike football, and people may have the virus, but
Speaker 1: they may have acquired it elsewhere from families or the community,
Speaker 1: so it's not It's not that baseball itself may be
Speaker 1: necessarily risky. But people have normal lives outside of baseball.
Speaker 1: But I think if we test people and we get
Speaker 1: these results back anywhere from ten minutes to twenty four
Speaker 1: hours later, I think if we can test a player
Speaker 1: and say the day before as we do before, say
Speaker 1: Colonoscar Bees. Uh, if they're negative, then I think it's
Speaker 1: reasonable for them to engage in in h in the
Speaker 1: sport right now, Mike will take a lot of testing
Speaker 1: right now. My understanding according to reports is that the
Speaker 1: MLB is testing players every other day, but the results
Speaker 1: typically come in about thirty six hours later. So in
Speaker 1: the meantime, those players are continuing to do their normal routine,
Speaker 1: which includes traveling to other cities to play against other teams,
Speaker 1: and then they have to backtrack later on if they
Speaker 1: find out anything. I mean, this is a league that
Speaker 1: can afford to test its players every other day. What
Speaker 1: does it say about our ability to get youth sports
Speaker 1: back online again? If clearly youth sports are not going
Speaker 1: to test players until there's a reason to, until the
Speaker 1: family member brings someone to the doctor's office because they
Speaker 1: suspect that there is something going on. That's a that's
Speaker 1: a great question, right, So typically we say, well, what
Speaker 1: are we going to do with the result? So if
Speaker 1: you are positive or negative, if you feel fine, are
Speaker 1: we going to do anything differently? So, if someone is
Speaker 1: sick a respiratory infection, cought diarrhea, fever, you know, any
Speaker 1: of those classic symptoms. Yes, it's very helpful to do
Speaker 1: a swab and say you have it, and you may
Speaker 1: manage the patient differently. You're right in terms of dollars
Speaker 1: and cents. It can get very expensive to test people constantly,
Speaker 1: and most sports don't have that ability. I think for
Speaker 1: youth sports there there are two things. One um, the
Speaker 1: more testing the better. But if a kid really is sick, fortunately,
Speaker 1: they tend to do better than older people. It's not
Speaker 1: like fifty or sixty or seven year olds who have
Speaker 1: a much much higher risk. I'm not saying they're at
Speaker 1: zero risk. I'm just saying that overall, kids tend to
Speaker 1: do better. On the other hand, of you know, they
Speaker 1: may have to have fewer games. They may have to
Speaker 1: test and wait thirty six hours and then schedule a
Speaker 1: game for everyone, you know, twice a week. Playing every
Speaker 1: day may not may not be realistic. Yeah, there's so
Speaker 1: many big questions. I feel like we're still finding our
Speaker 1: way here for sure. Dr Ia lest made a great
Speaker 1: to catch up with you. Thank you so much for
Speaker 1: your time. As always, Clinical Associate Professor of Medicine at
Speaker 1: ny US, Lango Medical Center. Well, I have to say,
Speaker 1: if the vacation Carol Master were here, she would classify
Speaker 1: this as a wait what sort of story. It is
Speaker 1: an amazing read. Danielle book Of wrote it. She is
Speaker 1: a reporter for Bloomberg News, but I have to say
Speaker 1: that title is actually outdated. As of this week, she
Speaker 1: has just been named our new Toronto ber chief. So
Speaker 1: congratulations to on that huge job and well deserved. She
Speaker 1: joins us from Toronto, and Joel Weber, the editor Bloomberg
Speaker 1: Business Week, he joins us as well. So Joel t
Speaker 1: this up for us because this is an incredible story
Speaker 1: about up golden hands. What yeah, do we get your
Speaker 1: interest there? Um? You know, this has actually been sort
Speaker 1: of months in the works, and you know, then the
Speaker 1: pandemic hit and everything got weird. But the moment that
Speaker 1: we uh that that Danny pitched the story, we were like,
Speaker 1: wait what. So we got to rewind the clock a
Speaker 1: little bit. And in the early two thousands, Nelson Mandela
Speaker 1: to South African icon UM had uh you know basically
Speaker 1: uh you know, become an international icon and UM as
Speaker 1: part of that um, some people cast his hands in
Speaker 1: South Africa and the ideal was that they were going
Speaker 1: to turn his these castings into uh, precious metals, gold
Speaker 1: and others that they would be able to kind of
Speaker 1: show around the world and really kind of like, you know,
Speaker 1: make his legacy be something that everyone could actually see
Speaker 1: in person. So, uh that happened, and uh then it
Speaker 1: kind of went sideways because he said, you know, I
Speaker 1: don't want to be affiliated with this anymore, and I'm
Speaker 1: going to turn over to Danny. There because there was
Speaker 1: an art collector who stepped in and was like, you know,
Speaker 1: there's only a couple of these around, I'm gonna go
Speaker 1: ahead and just put them all together and make a set.
Speaker 1: So Danny, who was this guy and where did the
Speaker 1: story go from there? So his name was Malcolm Duncan
Speaker 1: and I actually met him two years ago, so it
Speaker 1: goes back even further in I was approached by a
Speaker 1: PR firm representing this South African businessman, Malcolm Duncan, uh,
Speaker 1: and they were trying to drum up publicity for a sale.
Speaker 1: And at the time they had attempted to fire Arbitrayed,
Speaker 1: which was a Canadian cryptocurrency company, and at least part
Speaker 1: of the payment for these golden hands of Nelson Mandela
Speaker 1: was going to be in bitcoin, So even then it
Speaker 1: was just a bizarre story. And I actually did a
Speaker 1: short article about the sale at the time, but I
Speaker 1: didn't have a lot of time to dig into the
Speaker 1: back story, and if it's sort of became one of
Speaker 1: those stories that you sort of regret never having delved
Speaker 1: into who as deeply as you could have. Then earlier
Speaker 1: this year, um Guernsey's auction house reached out to me
Speaker 1: through another PR firm to say that they were planning
Speaker 1: this spectacular event at Jazz at Lincoln Center to introduce
Speaker 1: these amazing objects to the world. They were going to
Speaker 1: auction them off and what I like to cover the auction,
Speaker 1: So I called Malcolm back. I found out that the
Speaker 1: ARBITRTE deal had shockingly collapsed disastrously. I got more of
Speaker 1: that backstory, and uh, it just became one of those
Speaker 1: stories where the more I found out about these things,
Speaker 1: the more interesting I got. So what fascinates me here
Speaker 1: is that you would think there's a lot of demand
Speaker 1: for things that are linked to uh Nelson Mandela and
Speaker 1: also for gold, given where gold prices are trading. But
Speaker 1: it's been hard for Malcolm Duncan to get a lot
Speaker 1: of interest for these Golden Hands. Why is that there's
Speaker 1: been a real um taint around Mandela Art. I think
Speaker 1: when he was initially released from prison after twenty years
Speaker 1: twenty seven years in prison. Um, this whole kind of
Speaker 1: cottage industry sprang up around Mandela Art. And you know,
Speaker 1: he had done his own art, but but people were
Speaker 1: slapping his names on everything. At at at a certain point
Speaker 1: he got fed up with it. He shut it down.
Speaker 1: There were a lot of lawsuits and I think to
Speaker 1: this day people in fact get quite uncomfortable when you
Speaker 1: bring up the whole tawdry mess of Mandela Art in
Speaker 1: South Africa. Um. So because of that, there there have
Speaker 1: been plans to make just a ton of these things
Speaker 1: that they were gonna be in silver and bronze. There
Speaker 1: was gonna be one for every day of every year
Speaker 1: that he'd been in prison. As far as we know,
Speaker 1: and and harmony has confirmed this. Duncan is believed to
Speaker 1: have the only surviving copies which are these four gold hands. Um.
Speaker 1: And you're right, I mean the I was there for
Speaker 1: two days at the auction. It wasn't well advertised, but
Speaker 1: very few people came out. What struck me though as
Speaker 1: amazing was those people who who did come out just
Speaker 1: how moves they were by these things. So Danny, I
Speaker 1: have to ask about the auction and tell us what
Speaker 1: went down and where things stand now. Okay, So the
Speaker 1: auction was a very bizarre situation. As I said, I
Speaker 1: was there for two days. You know, not very many
Speaker 1: people came came around those and this was early early March,
Speaker 1: New York, pre pandemic. Yeah, so you know, to paint
Speaker 1: the scene, you imagine it's at jazz at Lincoln Center.
Speaker 1: So it's this beautiful, beautiful venue, dark red sort of
Speaker 1: jazz playing softly. These things are in these cases lit
Speaker 1: from above, uh, and the room is absolutely empty. People
Speaker 1: drift in from time to time. A lot of them
Speaker 1: are actually moved to tears when they see them, which
Speaker 1: was quite something to watch. But most of the people
Speaker 1: that I saw there over the two days were actually
Speaker 1: people who had skinned the games. They were they were
Speaker 1: people associated with the auction. Um, you know, one of
Speaker 1: one of the investors of Arbitrary who now owns two
Speaker 1: of the hands. The ownership of these things was quite complicated.
Speaker 1: So the auction happens um only two of the hands
Speaker 1: sale cell. Everybody's feeling quite flat afterwards. And then suddenly,
Speaker 1: like at the happens hour, Um, somebody's on the phone
Speaker 1: and it's the buyer and he says, actually he'll take
Speaker 1: the other two as well. So this mysterious buyer on
Speaker 1: the phone ends up paying more for all of the
Speaker 1: hands than he could have got them for fifteen minutes
Speaker 1: earlier had he just bought them during the auction. It
Speaker 1: was just bizarre. Everything was shocked. The auctioneer said he
Speaker 1: had to sit down. Nobody had seen anything like this
Speaker 1: and it seemed like this great, perfect ending to my story.
Speaker 1: Except Malcolm Duncan never got paid. And so the twist
Speaker 1: is just like you keep you get You're like, okay,
Speaker 1: well that I mean, it's like one of these like
Speaker 1: thrillers where it's like but wait, I mean, it's crazy.
Speaker 1: It It was really crazy. And you know, you've got
Speaker 1: to feel for Malcolm Duncan. He's like this incredibly colorful character.
Speaker 1: He tells the most amazing stories. Uh, and he has
Speaker 1: been trying to unload these hands for so many years.
Speaker 1: At this point, Um, last I spoke to him, the
Speaker 1: Guernsey is the auction house says that even though the
Speaker 1: buyer missed the deadline to pay. That that that possibility
Speaker 1: is still out there, that that sale is still alive,
Speaker 1: it's still going to happen. Um, Malcolm is very doubtful
Speaker 1: about this, but he thinks he may have an Italian
Speaker 1: buyer on the line. We don't know much about that person.
Speaker 1: Uh so. So yeah, not a lot of resolutions, but
Speaker 1: it is. It is a tale fit for a Netflix series.
Speaker 1: I'll just say that it is amazing. Danielle book of
Speaker 1: She is our new Toronto beer chief, newly minted. Congratulations
Speaker 1: on that. Congratulations on this story as well. As I
Speaker 1: said to Danielle and I center him said earlier, it's
Speaker 1: a heck of a week to have this story and
Speaker 1: get that job. So congrats to her. It's a terrific rate.
Speaker 1: Joe Weber, editor of Bloomberg Business Week, you are listening
Speaker 1: to Bloomberg Business Week. Well, we've gotten very interested, especially
Speaker 1: of late with the launch of Bloomberg Green In. What's
Speaker 1: going on in the world is sustainable investing. Luckily for us,
Speaker 1: we have Chris McNett with us. He's cohead of sustainable
Speaker 1: investing at Wells Fargo Asset Management, joining us on the
Speaker 1: phone from San Francisco. So Chris, it feels like, first
Speaker 1: of all, thank you for joining Scarlett and myself on
Speaker 1: this Friday afternoon. It does feel like sustainable investing starting
Speaker 1: to have a moment. I would guess you would argue
Speaker 1: it's been having a moment for a while, but it
Speaker 1: does feel like the aperture is widening a bit in
Speaker 1: a good way, that more people are paying attention. Yeah,
Speaker 1: that's exactly right. And also it's it's a real pleasure
Speaker 1: to be here. Um. I would say that, yes, you know,
Speaker 1: for those of us like me, we've been in this
Speaker 1: space for a lot of years, it felt like it
Speaker 1: feels like, you know, now we're almost sitting in an
Speaker 1: inflection of point um where it's really getting into the mainstream. UM.
Speaker 1: And we've seen the demand really pulled up through you know,
Speaker 1: the really chop chop the market for the first part
Speaker 1: of the year and really start to accelerate. And I
Speaker 1: think there's a couple of reasons for that that we
Speaker 1: can go into. Well, it usually comes down to performance
Speaker 1: as well. I mean, along with people wanting to increase
Speaker 1: their exposure to sustainable companies and e s G principles,
Speaker 1: performance matters and usually in a E s G portfolio
Speaker 1: portfolios are going to underwake companies in the energy sector
Speaker 1: and perhaps load up on companies that are in the
Speaker 1: tech sector. We have a market right now that is
Speaker 1: all driven by technology, and when it does fall, it's
Speaker 1: being led by energy stocks. How much how much technology
Speaker 1: exposure does well as fargoes e. S G portfolio or
Speaker 1: sustainable portfolio have, Yeah, I mean, it's performance does always
Speaker 1: matter at the end of the day, um, And I
Speaker 1: think that's what it's really starting to draw a lot
Speaker 1: more interest, is that the performance of sustainable funds have
Speaker 1: really held up particularly well, you know, not just here today,
Speaker 1: but even if you look across longer time periods. And
Speaker 1: it's true that, um, you know, sustainable investing mindset might
Speaker 1: lead you to underweight energy, and of course the way
Speaker 1: that energy has performed, you know, blaked Um, that's kind
Speaker 1: of been a winning trade. But a lot of the
Speaker 1: outperformance is coming not from sector missuaits, but really from
Speaker 1: looking at the sc credentials m and reflecting that in
Speaker 1: security selection. So we really go sector by sector when
Speaker 1: we analyze the s G. Rather than try and pick
Speaker 1: over underweights two sectors, we really look at particular companies
Speaker 1: and do that deep research. So, Chris, I do wonder,
Speaker 1: you know, what's been the impact it either kind of
Speaker 1: tonally or or demonstrably when are quantifiably I guess when
Speaker 1: it comes to COVID nineteen and maybe a change in thinking.
Speaker 1: You know, you reference some of the choppiness and the
Speaker 1: volatility in the market. But I do wonder are people
Speaker 1: reconsidering kind of where they're investing in how they're investing,
Speaker 1: just given everything that's going on in the world. Yeah,
Speaker 1: I mean that's exactly right. I think there was a
Speaker 1: fair bit of commentary that so much of the growth
Speaker 1: and in the s G marketplace happened since the global
Speaker 1: financial crisis that was maybe a bear market luxury, and
Speaker 1: we've actually seen it UM not just hold up through
Speaker 1: the pandemic, but but actually really thrived UM. And what
Speaker 1: it's also causing, to your points, is a bit of
Speaker 1: a rethink about what's really valuable UM from you know,
Speaker 1: maybe a values or moral like a human perspective, right,
Speaker 1: I mean, like I think people are thinking more about
Speaker 1: what they're doing for the world. Yeah, I mean that's
Speaker 1: exactly right. And I think it particularly comes down to UM,
Speaker 1: you know, employee well being and human capital that's always
Speaker 1: been a SCARN is sustainable and the investors because of
Speaker 1: kind of the morality of fair in decent work, but
Speaker 1: also the potential performance benefits that can come from it.
Speaker 1: So we really start to see social concerns UM and
Speaker 1: that and that can university that could be you know,
Speaker 1: fair and equal employment really start to rise up the
Speaker 1: agenda UM. And you know, I think that that's something
Speaker 1: that's probably going to persist, you know, through and beyond
Speaker 1: the beyond the crisis. Yeah, backing up your your principles
Speaker 1: with your money, UM, Chris. We spoke earlier this week,
Speaker 1: Jason I did with the sustainability chief of Philip Morris International,
Speaker 1: the cigarette company, and they have a pretty ambitious plan.
Speaker 1: They are working towards a smoke free future UM. They're
Speaker 1: making changes to their supply chain, zero child labor for instance,
Speaker 1: ensuring that farmers make a living income by electronics, smoke
Speaker 1: free devices UM equipped with age verification technology. By you
Speaker 1: look at your potential stocks on a security by security basis.
Speaker 1: Would Philip Morris make the cut? Yeah, I mean that
Speaker 1: that that comes down to UM A lot of you know,
Speaker 1: what investors really value UM, And at the end of
Speaker 1: the day, you know where we exist to serve our investors. Um.
Speaker 1: So some investors probably would have a problem with with
Speaker 1: a company like Philip Morris just because the types of
Speaker 1: products that they make, which in many ways you know,
Speaker 1: doing flick harm and a kind of a social cost,
Speaker 1: you know. But if you're thinking about looking at say
Speaker 1: a Philip Morris compared to another tobacco company, then you
Speaker 1: would look at those types of things that you that
Speaker 1: you just spelled that, and then you could use them
Speaker 1: to assess, you know, which of those tobacco companies are
Speaker 1: which oil company, um, you know, are more aligned with
Speaker 1: a sort of a healthier and more sustainable future. And
Speaker 1: then in that context, sure you could have a portfolio
Speaker 1: where you could find its way in there. Interesting. All right, well,
Speaker 1: we'd love to keep in touch with you. This is
Speaker 1: really interest. See Chris McNett, cohead of sustainable Investing for
Speaker 1: Wells Fargo Asset Management, joining us on the phone from
Speaker 1: San Francisco roc A journal. But you let me drive.
Speaker 1: Oh no, no, no no, no, honey, please, I'll do the
Speaker 1: riding vel exst me. I want to try it. Just drive, baby,
Speaker 1: the questions trying This is the drive to the globe commune. Thanks,
Speaker 1: we'll try us on Bluebird Radio. All right, it is
Speaker 1: time for the drive s clothes. I have to mention
Speaker 1: one thing, Scarlett that Kikato. I just saw a tweet
Speaker 1: go by that said in reference to Microsoft and its
Speaker 1: potential acquisition of TikTok. Someone said, someone tweeted, Microsoft is
Speaker 1: in TikTok's It's funny. That's only That's something only a
Speaker 1: business journalist, I think could love. But there are a
Speaker 1: lot of things the only business journalists them any kind
Speaker 1: of great pun, you know, especially in a Twitter format. Exactly,
Speaker 1: it really is. Twitter was made for ridiculous things like that.
Speaker 1: All right, let's get serious here. It's Friday. Henley Smith
Speaker 1: is back with a senior vice president, senior relationship manager
Speaker 1: for Stonecastle Cash Management once again with us. Join us
Speaker 1: on the phone from eastern Connecticut. Henley, how are you.
Speaker 1: How are things in Connecticut? Well, very very well, I'm
Speaker 1: calling you from rural Connecticut where we do social distancing.
Speaker 1: We have it down to a science. Yeah, so yes,
Speaker 1: and I enjoyed that fun as well. I thought that
Speaker 1: was very clever. Good well, thank you, thank you. I
Speaker 1: appreciate that. Yeah, we do our best, you know, to
Speaker 1: keep it a little light here on a Friday. I mean,
Speaker 1: it's been an interesting period even this week. You know,
Speaker 1: I was asking Henley are Stocks editor Dave Wilson just
Speaker 1: a few minutes ago, like what's the thing that you
Speaker 1: sort of take away from this week? And I'll pose
Speaker 1: the same question to you. What, you know, what's the
Speaker 1: most important thing is you maybe have a socially distanced
Speaker 1: cocktail or something, or maybe a zoom cocktail. Whatever it's
Speaker 1: going to be. What what really struck you about the
Speaker 1: markets this week or the investing world. Well, it's it's
Speaker 1: kind of been ongoing for us as we're dealing with
Speaker 1: kind of an interesting dynamic. As you know, our focus
Speaker 1: is a short part of the fixed income curve and
Speaker 1: cash management, cash investments, and obviously we're dealing with ultra
Speaker 1: low interest rates yet again. But the interesting dynamic and
Speaker 1: the takeaway I have is that cash you teems to
Speaker 1: build up mostly on the institutional level, and with even
Speaker 1: with these low interest rates, the choices that institutional investors
Speaker 1: have continued to be limited. So you're seeing a lot
Speaker 1: of money market funds, prime money market funds shut down,
Speaker 1: You're starting to see government money market funds limit their investors,
Speaker 1: and so it's kind of an interesting dynamic where again,
Speaker 1: you have all this cash that's kind of been building
Speaker 1: up as a reserve, as a rainy day funds. It's
Speaker 1: just you know what's going to happen next, and even
Speaker 1: with his low interest rates, uh, they're having trouble placing it.
Speaker 1: So the curve really ensured, has really kind of flattened,
Speaker 1: as we all know, and it continues to compress. But
Speaker 1: that doesn't deter institutional investors. They're still building cash at
Speaker 1: this point. They're still building cash. What's going to cause
Speaker 1: them to make a decision to put it to work?
Speaker 1: I mean, Jason was talking about one half trillion dollars
Speaker 1: for private equity. We had Katie Greifeld on earlier talking
Speaker 1: about c l o E t f s because everyone's
Speaker 1: looking for some kind of yield. Cash is building up,
Speaker 1: Cash is sitting there money market funds. At some point
Speaker 1: someone's going to want to commit it to put in
Speaker 1: something that will tied up for more than just a
Speaker 1: day or two or a month or a week. What's
Speaker 1: going to be that catalyst? Yeah, again, I don't know
Speaker 1: what the catalyst. I mean, I think we all know
Speaker 1: what the ultimate catalysts will be and that you know,
Speaker 1: a vaccine that's safe and effective, and we know that
Speaker 1: that's the ultimate. But yeah, at some point that cash
Speaker 1: continues to build a is going to have to find
Speaker 1: a place that it can earn a better return. You know,
Speaker 1: most money market funds are paying under ten basis points
Speaker 1: closer to one basis point right now. Now, again, a
Speaker 1: lot of our clients still want to have the f
Speaker 1: d I c ensured through our our programs, and that's
Speaker 1: what they're hanging on to right now. But at some point, uh,
Speaker 1: they're going to move out on the curve or do
Speaker 1: something that typically you know, a lower quality asset, and
Speaker 1: that ultimately might be the you know, a second mistake.
Speaker 1: There's really no uh premium to extend at this point.
Speaker 1: I was talking to a client this week and they
Speaker 1: said they could get place six month money at two
Speaker 1: basis points. So yeah, I'm not quite sure what it is.
Speaker 1: I said, I think we all know what it ultimately is.
Speaker 1: But at some point that money is going to have
Speaker 1: to move somewhere. But right now it's you know, I
Speaker 1: want to stay safe, I want to stay liquid, and
Speaker 1: I'm not going to move it from there. And it's
Speaker 1: not if I'm not gonna paid less for it. As
Speaker 1: long as I know it's there, I'm I'm happy with that.
Speaker 1: And that's the message we continue to get from our clients.
Speaker 1: So talk to me if you can about the political
Speaker 1: scene as it relates to investors, because I feel like,
Speaker 1: and I've said this on this program several times, in
Speaker 1: a normal presidential election year, we were really starting to
Speaker 1: be heating heating up right now when it comes to
Speaker 1: trying to figure out from an investment perspective what a
Speaker 1: re election or a new administration would mean historically. How
Speaker 1: have you thought about that? How are your clients feeling
Speaker 1: about it now, given that the presidential election is really
Speaker 1: just one of several major inputs that are on their minds. Yeah,
Speaker 1: I mean it's been a difficult period nonetheless, just having
Speaker 1: all this politicized back and forth and all the things
Speaker 1: that we've been dealing with, and as we've talked about before,
Speaker 1: it feels like we've just kind of tripped into one
Speaker 1: crisis after or next apter and next, And I think
Speaker 1: in typical years you would kind of wait till after
Speaker 1: Labor Day and then get all excited or not excited
Speaker 1: or what have you or kind of do the analysis. Um,
Speaker 1: but yeah, I think from the very beginning this period
Speaker 1: that we've been in, this very unusual period has been politicized,
Speaker 1: and so we've been dealing with that back and forth
Speaker 1: and um, but you know again, I think that that
Speaker 1: kind of focuses and feeds into what we've been doing.
Speaker 1: That's why you've seen a lot of large businesses just
Speaker 1: hang on to cash and keep it there, and retail
Speaker 1: investors as well. I mean, I think they're they're just
Speaker 1: going to let things play out and then then make
Speaker 1: a decision. And I think that's probably a smart thing
Speaker 1: to do. Speaking of companies with a lot of cash
Speaker 1: and retail investors, Apple, of course announcing a four for
Speaker 1: one stock split. Jason and I were talking about how
Speaker 1: ultimately maybe a play for retail investors because you bring
Speaker 1: down the price of each shares each stock. Do you
Speaker 1: think that's how investors see it? I would think so. Um.
Speaker 1: You know again, it even that net net is the
Speaker 1: same price, but it looks cheaper. So obviously you see
Speaker 1: Apple uh moving up smartly again today. So yeah, I
Speaker 1: mean I think that that four for one split will
Speaker 1: make the price uh that much more affordable. For a
Speaker 1: lot of people and no broaden out there their investor base,
Speaker 1: and I think a lot of people will will gravitate
Speaker 1: towards that it's a great name, as we know, and
Speaker 1: uh uh, you know, I think if it's if it's
Speaker 1: cheap on a share per share basis, then I think
Speaker 1: you'll see a lot more people get involved. Yeah, alright,
Speaker 1: we're gonna leave it there. Thank you so much. Kenley Smith,
Speaker 1: Senior Vice president, senior relationship manager for Stonecastle Cash Management,
Speaker 1: join us on the phone. As he pointed out from
Speaker 1: rural Easton, Connecticut, have a great weekend. Thanks so much
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