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Speaker 1: Bloomberg Audio Studios, Podcasts, radio News.

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Speaker 2: This is the Bloomberg Surveillance Podcast. I'm Jonathan Ferrow, along

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Speaker 2: with Lisa Bromwitz and Amrie Hordern join us each day

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Speaker 2: for insight from the best in markets, economics, and geopolitics

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Speaker 2: from our global headquarters in New York City. We are

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Speaker 2: live on Bloomberg Television weekday mornings from six to nine

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Speaker 2: am Eastern. Subscribe to the podcast on Apple, Spotify, or

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Speaker 2: anywhere else you listen, and as always on the Bloomberg

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Speaker 2: Terminal and the Bloomberg Business app. We begin with our

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Speaker 2: top story, stocks on track for a fifth straight day

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Speaker 2: of gains following a week of softer than expected inflation data.

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Speaker 2: Darrel Cronk of Wells Fargo saying the following, as the

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Speaker 2: S and P five hundred makes news highs, it's important

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Speaker 2: for investors to rebalance to avoid portfolio equity concentration risk,

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Speaker 2: trim tech and communications services to neutral waitings.

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Speaker 1: Darrell joined us for more. Darren, good morning to you.

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Speaker 2: Good morning, jar What did you can opening exchange with us?

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Speaker 1: I'm with you one hundred percent. I mean, so everybody

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Speaker 1: knows the concentrated returns. I just ran the numbers yesterday.

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Speaker 1: If you look at just the top five names, right,

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Speaker 1: not the top ten, top five, they're driving about eighty

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Speaker 1: two percent of the index thirteen to fourteen percent year

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Speaker 1: to date return. So strip that out, you're you're up

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Speaker 1: maybe two three percent you're to date on the broad level.

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Speaker 1: But maybe what's more important is when you look at

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Speaker 1: those names, the top five ten names, the correlations are

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Speaker 1: as high as they've been since August of nineteen ninety seven, right,

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Speaker 1: So what's that tell you? It tells you that people

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Speaker 1: are chasing, right, they're chasing those winners and continuing to

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Speaker 1: feed into it. And to Lisa's very good point, if

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Speaker 1: you take the Nasdaq one hundred against the Russell two thousand,

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Speaker 1: so tech against small cap five year wides, right, I

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Speaker 1: mean we're at the widest level we've been. So you know,

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Speaker 1: small cap continues to underperform. Not surprisingly. I keep getting

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Speaker 1: asked every conference room I go into every meeting, when's

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Speaker 1: the time to buy small wins? It time to buy

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Speaker 1: a small cap? And I keep saying, not yet, not yet,

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Speaker 1: not yet? Right, when is the sun? I the rustle too,

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Speaker 1: probably needs to be somewhere in the eighteen hundreds, maybe

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Speaker 1: even seventeen hundreds before. I think you get a compelling

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Speaker 1: risk reward to flip there. That makes sense, but nowhere

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Speaker 1: here above two thousand.

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Speaker 3: So why do you have this argument that you should

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Speaker 3: be more concerned about concentration since that's one, and more

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Speaker 3: interested in some of the others that keep lagging behind.

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Speaker 1: I think because eventually you end up with this kind

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Speaker 1: of think of it almost like a you know, it's

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Speaker 1: a teflon market, right. Nothing seems to stick to it.

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Speaker 1: Every risk that we roll at it, right, whether it's

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Speaker 1: you know, the France risks this morning and the tails

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Speaker 1: or anything like that, just seems to bounce off of it.

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Speaker 1: And the same theme plays through AI wins, tech wins. Right,

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Speaker 1: it's seven months into that. You you know, if you

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Speaker 1: run a marathon or a race and you sprint for

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Speaker 1: seven months, which we have sprinted, Let's be honest about it,

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Speaker 1: you're going to be tired. And I think the market

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Speaker 1: is tied here. It's you know, when you look at

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Speaker 1: those top concentrated names to the point, they're doing extraordinarily well, right,

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Speaker 1: And I'll take it, but I get under the surface, right,

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Speaker 1: whether your point equal weighted small cap, I look at

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Speaker 1: some of the other sectors, they're just not participating at

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Speaker 1: the same level.

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Speaker 3: So I guess the question is do you sell your

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Speaker 3: big tech exposure or do you buy everything else. It's

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Speaker 3: a big distinction. Are you bullish on the other sectors

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Speaker 3: or are you just simply getting a little bit more

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Speaker 3: skeptical of how much further tech can run.

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Speaker 1: So yes to the former, right, which is so I

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Speaker 1: think when you get underneath. We just released our mid

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Speaker 1: year outlook this week.

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Speaker 2: Right.

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Speaker 1: One of the things we did in the midia outlook

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Speaker 1: was took energy to the most favorable we could possibly

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Speaker 1: take it too, right in the portfolios. Basically, we ran

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Speaker 1: it up to the highest big pullback obviously in oil prices.

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Speaker 1: We've taken all the political risk premium out of oil prices,

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Speaker 1: which kind of shocks me. Given the global landscape and

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Speaker 1: where we are. I'm getting a lot of big whether

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Speaker 1: it's you know, the integrated energy names or even some

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Speaker 1: of the expiration companies. At twelve thirteen fourteen times pace

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Speaker 1: ease with a three and a half percent dividend, I

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Speaker 1: will take that all day long. We also like materials.

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Speaker 1: We think healthcare is a good value play here, and

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Speaker 1: we would fade places like you know, the consumer obviously

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Speaker 1: reads and even financials look a little bit over.

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Speaker 3: Brought to us here, wait, consumers reads and financials. This

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Speaker 3: is very interesting at a time where the fed estensiply

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Speaker 3: is going to be cutting rates pretty soon. And at

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Speaker 3: one point this was supposed to fuel the next consumer

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Speaker 3: spending wave in the sense of consumer strength and ability

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Speaker 3: to borrow in a new way. Why is it not

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Speaker 3: playing out that way?

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Speaker 1: Because I'm not sure the consumer is as strong as

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Speaker 1: people want to give it credit for, right, I mean,

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Speaker 1: if you everybody does the including us, you know, the

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Speaker 1: top five quintiles of income, right, we know that the

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Speaker 1: bifurcation of the high end is doing well, the low

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Speaker 1: end is not. But what people are missing is kind

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Speaker 1: of the creep up into the middle income levels of

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Speaker 1: where people are trading down for value. They're not spending

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Speaker 1: as robustly as they want to. You see. You know,

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Speaker 1: consumer confidence numbers are still on a downtrend. Small bit

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Speaker 1: business numbers are still you know, pretty ugly right when

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Speaker 1: you get below the surface. So there's just not a

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Speaker 1: lot of reason to believe, you know, to us, it

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Speaker 1: looks like the consumers kind of running that last mile

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Speaker 1: here right, they've they've been able to stay durable and

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Speaker 1: spend I'm just not sure how much gas is left

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Speaker 1: in the tank.

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Speaker 2: So this time last week, when we read out the

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Speaker 2: payrolls number two hundred and seventy two thousand, you didn't

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Speaker 2: hear two hundred and seventy two thousand.

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Speaker 1: You had something else. So I think payrolls and the

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Speaker 1: labor market in general are getting skewed heavily by some

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Speaker 1: of the lag effects of what's happening with immigration in

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Speaker 1: this country and everything else. So we ran the numbers again.

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Speaker 1: If you take just immigration from pre COVID levels, we're

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Speaker 1: three point three million people higher today in the labor

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Speaker 1: force than we were coming into twenty twenty, if you will.

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Speaker 1: That's having real impacts on the labor force, right, And

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Speaker 1: those numbers, so the labor market is still strong. We'll

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Speaker 1: take a four percent unemployment rate all day long, but

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Speaker 1: I'm not sure that it's as strong as maybe the

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Speaker 1: numbers might be. Sending a little false outquos there to us.

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Speaker 2: This is what Chairman Pound basically said in the news conference.

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Speaker 2: One of my sort of biggest takeaways from the polls

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Speaker 2: over the last year is this poll right here from

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Speaker 2: Guardian Harris Pole that came out in the last month

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Speaker 2: or so, and Aretus follows. I'll give you some headlines

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Speaker 2: a stonic fifty five percent believe the economy shrinking, fifty

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Speaker 2: six percent think the US is experiencing a recession. Forty

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Speaker 2: nine percent. Forty nine percent believe that unemployment is at

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Speaker 2: a fifty year high. Wow, forty nine percent. That's the

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Speaker 2: poll that came from Guardian Harris in the last month

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Speaker 2: or so.

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Speaker 3: It's the reason why consumer sentiment has been so low.

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Speaker 3: People don't feel good? Is that wrong? Can you say

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Speaker 3: that people's feelings are wrong or are they feeling something?

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Speaker 3: The numbers aren't showing in quite the same level and

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Speaker 3: people explained by the K shaped recovery. Stay tuned for

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Speaker 3: the University of Michigan Sentiments survey. We out in approximately

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Speaker 3: one hour and forty nine minutes.

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Speaker 2: Well, maybe we're just not measuring things properly. Correct in

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Speaker 2: a households versus establishment survey, allows sway was the big

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Speaker 2: stand doown down?

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Speaker 1: I think that's I think you're spot on right. I mean,

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Speaker 1: I think you've got to really you can't just take

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Speaker 1: those headline numbers as they stand, right, You've got to

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Speaker 1: dig in under the surface and kind of take the

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Speaker 1: second derivative, third derivative and understand what those numbers are

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Speaker 1: telling you. I am a big firm believer that liquidity

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Speaker 1: is masking so many things around the economic element. I mean,

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Speaker 1: if we just went back and around the numbers from

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Speaker 1: just the twenty twenties, where now twenty twenty four, obviously,

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Speaker 1: financial markets are up about forty six trillion dollars in

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Speaker 1: am right, government debt is up twelve trillion dollars. Right.

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Speaker 1: Think of just the liquidity that that pushes into the engine, right,

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Speaker 1: and the ability for consumers to stay longer, right, for

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Speaker 1: businesses to feel better. Right. All of that has had

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Speaker 1: this kind of long lasting use. It called the marathon effect.

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Speaker 4: Right.

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Speaker 1: We run hard seven months. But Wall Street isn't Main Street, right,

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Speaker 1: and so the S and P isn't what people are feeling.

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Speaker 1: If you walk up and down Main Street to the

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Speaker 1: point of the survey, right.

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Speaker 2: Forty percent belief the S and P is down for

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Speaker 2: the year.

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Speaker 1: This is quite a pole, isn't it.

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Speaker 3: A lot of a lot of the companies are down.

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Speaker 3: So it also speaks to the non AI and members.

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Speaker 2: Darren, this was great it's going to see us, sir,

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Speaker 2: thanks for sharing your thoughts. Darren Pronk there of wel Faco,

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Speaker 2: Poosha Shreenramp and the team over at Barclays maintaining their

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Speaker 2: call for one cut this year, writing quote, we continue

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Speaker 2: to think the cut to take place at the earliest

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Speaker 2: in September. Our baseline is predicated on inflation gradually moderating

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Speaker 2: in the coming months on a sequential basis and the

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Speaker 2: economy gradually slowing. Foosua joins us now for more POSA.

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Speaker 2: Great to have you with us on a program. I

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Speaker 2: just want to summarize the data we've had so far

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Speaker 2: this week. CPI cooler than expected, PPI downside surprise, then

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Speaker 2: jobless claims happened wrong kind of upside surprise. What did

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Speaker 2: you make of the claims print yesterday? And how concerned

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Speaker 2: should we all be?

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Speaker 5: So I thank the good morning. I think, you know,

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Speaker 5: we really did take too much signal from the claims data,

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Speaker 5: you know the fact that it did tick up for

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Speaker 5: the week. I think if that trend continues, it would

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Speaker 5: be in line with you know, some continued moderation in

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Speaker 5: labor market conditions, which you know really is a welcome

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Speaker 5: sign I think we should all remember labor market conditions

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Speaker 5: are very strong, whether you look at you know, the

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Speaker 5: three month moving average of payroll gains or even the

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Speaker 5: latest payroll report. I think some moderation is welcomed, particularly

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Speaker 5: from an inflation standpoint.

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Speaker 3: Jeff You earlier this morning from PNY said the market

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Speaker 3: is more dubbish than the Fed. It certainly seems that

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Speaker 3: way based on the bond market rally that John was

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Speaker 3: just talking about. You could see that into some of

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Speaker 3: the implied cuts. Do you think the market is wrong

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Speaker 3: to be so or do you see that the Fed

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Speaker 3: basically is trying to have a hackish health just so

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Speaker 3: they don't get it wrong to reversal of what happened

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Speaker 3: at the end of last year when they indicated that

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Speaker 3: they would be cutting rates.

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Speaker 5: I think, look, I think the markets don't necessarily price

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Speaker 5: just the baseline. They've got to price, you know, risks

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Speaker 5: around that, so you know the pricing is what it is.

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Speaker 5: And as faw it, you know what the Fed signaled

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Speaker 5: I think with a very balanced sort of a message.

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Speaker 5: You're right, you know they have been burnt once the

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Speaker 5: end of last year when there was a dubblesh stilt

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Speaker 5: in December after a run of you know, weak inflation

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Speaker 5: prints and then look what happened in the first quarter.

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Speaker 1: Of this year.

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Speaker 5: So I think just you know, they don't want to

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Speaker 5: make too much of one data point, and the totality

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Speaker 5: of the data that they keep talking about, whether it's

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Speaker 5: activity or labor markets, those haven't really shown a material easing.

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Speaker 5: And so you know, what they signaled in their SEP

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Speaker 5: on Wednesday was very much a tone of patients of caution,

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Speaker 5: of course, being cautious, and they want to gain confidence

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Speaker 5: that things are moving in the right direction.

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Speaker 3: What do you make then, of people who say, well,

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Speaker 3: if you put it all together, core PCE, which is

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Speaker 3: one of the key inflation metrics to the Federalserve looks at,

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Speaker 3: is something that is very predictable. If you have the

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Speaker 3: inputs of PPI and CPI and some of the other

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Speaker 3: data that's already come out. People are now mapping out

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Speaker 3: something akin to a zero point one percent increase in

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Speaker 3: core PCE, which would be very much in line with

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Speaker 3: the Fed's goals bringing a year over year inflation to

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Speaker 3: something like two point six percent.

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Speaker 2: How much do.

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Speaker 3: You see that as actually giving a green light to

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Speaker 3: the FED as early as September, even though that's not

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Speaker 3: your base case.

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Speaker 5: So look, I think we we agree with that translation.

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Speaker 5: Our own forecast for core PC in ME is a

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Speaker 5: point one three percent, so to your point, a very benign,

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Speaker 5: very soft looking core PC inflation print that said, you know,

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Speaker 5: we like to say that the FED is not data

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Speaker 5: point dependent, and it came across quite clearly in check

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Speaker 5: ours press conference as well, that they didn't want to

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Speaker 5: meet too much of one data point. He did say that,

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Speaker 5: you know, he welcomed the ME inflation outcome and that's

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Speaker 5: the step in the right direction. So, you know, like

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Speaker 5: we've written, should inflation outcomes continue to you know, move

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Speaker 5: in the right direction, i e. Come and soft. I

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Speaker 5: think that will open the door to a rate cut.

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Speaker 5: But is the may PCEE alone enough clearly not.

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Speaker 2: Pose sure some personal bass here, I have to say,

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Speaker 2: I wonder how many people agree with me. I'm far

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Speaker 2: more interested in how we end the year on unemployment

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Speaker 2: than i am on inflation. I sense from a lot

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Speaker 2: of people that come on this program they have far

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Speaker 2: less confidence about where this labor market will be by

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Speaker 2: year end than they do want how inflation's going to attrack.

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Speaker 2: And the reason I asked this question is because the

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Speaker 2: federal reservers come out and said, basically, we will end

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Speaker 2: the year with unemployment where it is right now, and

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Speaker 2: I'm trying to work out how much confidence you have

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Speaker 2: the unemployment does actually stabilize at these levels the next

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Speaker 2: twelve months plus.

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Speaker 5: You know, it's that that's a hard one to forecast.

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Speaker 5: You know, we work with the indicators that we have,

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Speaker 5: and clearly we haven't seen much by the way of

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Speaker 5: move up in the unemployment rate. Of course, you know,

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Speaker 5: we were at three four at some point in time.

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Speaker 5: You know, we've definitely ticked higher, but a four to

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Speaker 5: four point one percent is clearly not something that is

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Speaker 5: you know, weak by any standards, and I think this

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Speaker 5: is a labor market that is still running strong. You know,

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Speaker 5: we we look at the data as SOS we as

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Speaker 5: we can. Of course, you know, we're cognizant. A lot

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Speaker 5: of the games are concentrated in the private sector, particularly services,

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Speaker 5: particularly you know, education and healthcare, some from leision, hospitality.

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Speaker 5: So we've we've heard those arguments that the games are

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Speaker 5: all pretty narrow, but the fact that they continue, you know,

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Speaker 5: month on month is one thing. And second is you know,

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Speaker 5: we're looking at the Joel Stata job opening is sure,

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Speaker 5: you know, come down a bit, but still quite elevated.

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Speaker 5: And you know, if anything, it looks like you know,

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Speaker 5: that momentum is still there. So you know, we've we

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Speaker 5: we're looking for any signs of cracks. We haven't seen

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Speaker 5: so much. So you know, we're we're sort of with

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Speaker 5: the ft that we don't see a big spike in

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Speaker 5: the unemployment rate by the end of the earl.

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Speaker 2: Push you appreciate it. Push your stream ramp of Barclays.

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Speaker 2: Tesla shareholder's foken to approval on must fifty six billion

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Speaker 2: dollar pip package and green light. The company has moved

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Speaker 2: to Texas to stock having a pretty decent twenty four hours,

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Speaker 2: Tasha Kni of our constructive on the name right in

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Speaker 2: this our confidence in test usibility to launch a robotaxi

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Speaker 2: network within the next five years has increased considerably. A

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Speaker 2: place to say that we can catch up the Tesla.

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Speaker 2: But right now, Tasha, great to catch up with you.

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Speaker 2: I just want to start with the shareholder votes of

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Speaker 2: the last day or so. Of course they've been going

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Speaker 2: on for a number of days. Do you think we

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Speaker 2: can leave this issue in the past now and move on.

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Speaker 4: Well, you know, I'm not a legal expert, so of course,

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Speaker 4: you know, we know what investors want, and now it

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Speaker 4: could be up to the courts again. But what I'll

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Speaker 4: say is that I think it's positive that you know,

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Speaker 4: we saw investors considering the proxy and putting their own

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Speaker 4: votes in voting for themselves. You know, when we look

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Speaker 4: at Tesla, where we certainly want Elon Musk to be

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Speaker 4: at the helm, especially when you can consider the transition

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Speaker 4: to fully autonomous driving, which is what we think will

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Speaker 4: drive the majority of the value of the company over

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Speaker 4: the next five years.

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Speaker 2: Can you walk us through why and why you think

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Speaker 2: that's the real deal and we'll see it that quickly

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Speaker 2: over the next five years.

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Speaker 4: Yes. Well, so we already have robotaxis right Waimo, which

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Speaker 4: is Alphabet's autonomous driving project, is driving around Phoenix. They're

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Speaker 4: you know, starting an effort in La. They're in San Francisco,

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Speaker 4: but we don't have them at scale yet. Tesla could

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Speaker 4: be one of the first companies to offer a service

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Speaker 4: like this at scale, and it's because they have a

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Speaker 4: massive data advantage. They're collecting information from customer cars that

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Speaker 4: helps them train their models. You know, and they have

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Speaker 4: more cars on the road than any other autonomous effort

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Speaker 4: that I know of in the US, And you know,

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Speaker 4: this is their plan. They're layering on software updates incrementally.

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Speaker 4: Right now, it's the full self driving software that's available

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Speaker 4: to customers. Eventually customers will be able to take their

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Speaker 4: hands off the wheel. And then last night, you know,

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Speaker 4: we heard Elon Musk talk about extensively the robotaxi effort,

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Speaker 4: where you, as a customer, could sign your car up

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Speaker 4: when you're not using it, you know. But more likely,

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Speaker 4: I think it'll be a fleet model, so you'll have

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Speaker 4: perhaps another company that owns and maintains the fleet. Tesla

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Speaker 4: collicks a take rate off of the mile revenue, and

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Speaker 4: you know, I think this could have very attractive margins,

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Speaker 4: higher margins than the current business model today, which is

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Speaker 4: mainly selling vehicles, right, and this will be a recurring revenue.

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Speaker 4: So so again we think very attractive from an economic

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Speaker 4: perspective to Tesla. But more importantly, it'll change all of

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Speaker 4: our lives. You know, I think this is one of

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Speaker 4: the greatest AI projects in our time, and we are

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Speaker 4: so lucky that we get to witness it.

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Speaker 3: Tasha, there are some real questions about Elon Musk's leadership

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Speaker 3: and whether he is focused enough on Tesla and diverting

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Speaker 3: some of the chips that have honestly reportedly have gone

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Speaker 3: to some of his other companies to really get some

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Speaker 3: of the ROBOTAXI efforts fully underway. Why do you think

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Speaker 3: that's not a concern.

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Speaker 4: You know, I actually think it's a positive that Elon

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Speaker 4: Musk runs a number of companies. One we've heard and

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Speaker 4: we've heard them talk about this. It's great for talent acquisition.

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Speaker 4: We've seen employees move in between his companies. You know,

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Speaker 4: if you're the top a AI engineer in the world,

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Speaker 4: you're not going to get bored working for Elon Musk.

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Speaker 4: You know.

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Speaker 1: The chip story.

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Speaker 4: What I point out is, you know, automakers actually often

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Speaker 4: negotiate on behalf of their suppliers, and they do so

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Speaker 4: because of economies of scale, they have better negotiating leverage.

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Speaker 4: So I think having you know, all of these companies

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Speaker 4: that you know, many of which might use in video products,

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Speaker 4: is again actually a positive here. And we've also seen

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Speaker 4: manufacturing innovations come from SpaceX that bleed into Tesla, So

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Speaker 4: you know, and I think you have to look at

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Speaker 4: the Tesla results here, right, I mean when you're talking

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Speaker 4: about the pay package that the stock has risen over

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Speaker 4: one thousand percent over that time period, So he's really

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Speaker 4: delivered shareholder value. And I'm again so excited for the

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Speaker 4: future because we're really on the cusp of autonomous driving today.

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Speaker 3: Tasha, is there absolutely anything that could happen that is

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Speaker 3: a potential event in the next year that could shake

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Speaker 3: your confidence right now in Tesla?

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Speaker 4: Well, you know, really, what I'm looking for is for

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Speaker 4: Tesla to cross that threshold into fully autonomous driving. We've

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Speaker 4: seen them tease this robotaxi service or a ride hill service,

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Speaker 4: both on the past Earning's call and at the event

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Speaker 4: last night, so I'm looking for that launch. So we

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Speaker 4: have an event coming up in August from Tesla that's

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Speaker 4: going to look at the purpose built robotaxi, the next

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Speaker 4: generation car. I don't think they need that car to

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Speaker 4: necessarily launch the service because the current fleet is capable

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Speaker 4: of it. But I am looking for details at that

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Speaker 4: event about what this business.

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Speaker 3: Model will look like.

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Speaker 4: We heard some of that last night, so we know

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Speaker 4: that they're thinking through the back end logistics of how

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Speaker 4: this will work. So I think that you know, they

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Speaker 4: could cross this threshold within the next year or two,

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Speaker 4: and that is the catalyst that you know, I'm most

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Speaker 4: looking forward to.

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Speaker 2: It's Tesla twenty six hundred dollars price target, which is

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Speaker 2: pretty punchy, as you know, and certainly gets attention, that's

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Speaker 2: for sure. Can you tell me the biggest risk factor

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Speaker 2: associated with your cal what would change your mind?

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Speaker 4: Well, you know, certainly, I think that solving autonomous driving

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Speaker 4: is a very difficult problem and so and you know

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Speaker 4: it's hard to time that exactly. But I again, as

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Speaker 4: you mentioned, you know in our blog which is on

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Speaker 4: the Ark and Best website, we think that this could

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Speaker 4: happen in the next five years, and our confidence has

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Speaker 4: increased with all the advances in AI and Tesla's you know,

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Speaker 4: improvements that they rolled out to customers that actually own

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Speaker 4: the vehicles.

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Speaker 1: In the software.

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Speaker 4: So you know that that is a risk. Again, we're

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Speaker 4: confident that they can do it, but it is a

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Speaker 4: difficult problem to solve. I think, Uh, you know what

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Speaker 4: gives us confidence from last night is, you know, if

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Speaker 4: this pay package gets totally approved, you know, we know

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Speaker 4: that Elon Musk is going to be at the helm

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Speaker 4: with this company for at least five more years. He

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Speaker 4: has limits and when he can exercise his options. So

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Speaker 4: I think that that is another key piece that we

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Speaker 4: want Elon Musk to stay. We want them to be incentivized.

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Speaker 4: So I think that's ultimately a good thing.

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Speaker 2: I do you know controls the fight of this call?

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Speaker 2: Do you think it is tested on their ability to

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Speaker 2: execute or do you think it is the regulator local

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Speaker 2: authorities who will ultimately have the decision to make to

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Speaker 2: give this the green light or not?

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Speaker 4: Great question, you know, it's just going to touch on that.

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Speaker 4: So often people are concerned about regulation. I actually think that,

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Speaker 4: you know, again, the more difficult problem here is actually

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Speaker 4: making the technology work and scaling this type of service.

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Speaker 4: The US has actually been surprisingly lenient with autonomous driving

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Speaker 4: because it's been up to the States and we've seen

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Speaker 4: you know, Tesla right now they have over a billion

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Speaker 4: miles cumulatively in the full self driving software suite driven.

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Speaker 4: So I think that they'll be able to statistically prove

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Speaker 4: to regulators since this is safer than humans. And actually

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Speaker 4: we've done some research on this, so if you look

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Speaker 4: at their full self driving software suite, the last time

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Speaker 4: they give us a statistic which is a little over

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Speaker 4: a year ago. Now it looked like it was five

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Speaker 4: times safer than human driven tesla's and even safer than

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Speaker 4: the average car on the road. So we're already seeing

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Speaker 4: those proof points, and I think, you know, it could

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Speaker 4: get even better. In fact, Elon Musk has hinted that

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Speaker 4: they have line of sight to maybe a four x

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Speaker 4: movement of that, and that's what's going to matter to

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Speaker 4: regulators here. So we're already seeing those safety points.

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Speaker 2: Tuchakny, great to catch up with you. Thank you to

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Speaker 2: Kenny There of ARC Investment. This is the Bloomberg Surveillance Podcast,

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Speaker 2: bringing you the best in markets, economics, angiopolitics. You can

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