1 00:00:02,640 --> 00:00:05,320 Speaker 1: Welcome to the Bloomberg Penel podcast. I'm Paul swing you, 2 00:00:05,360 --> 00:00:07,680 Speaker 1: along with my co host Lisa Brahma Ways, each day 3 00:00:07,720 --> 00:00:10,240 Speaker 1: we bring you the most noteworthy and useful interviews for 4 00:00:10,280 --> 00:00:12,520 Speaker 1: you and your money. Whether at the grocery store or 5 00:00:12,560 --> 00:00:15,480 Speaker 1: the trading floor. Find a Bloomberg Penl podcast on Apple 6 00:00:15,520 --> 00:00:17,960 Speaker 1: podcast or wherever you listen to podcasts, as well as 7 00:00:17,960 --> 00:00:23,880 Speaker 1: at Bloomberg dot com. Well, the Mueller investigation is reportedly 8 00:00:24,079 --> 00:00:27,479 Speaker 1: nearing its end, with a report being delivered as soon 9 00:00:27,600 --> 00:00:30,480 Speaker 1: as next week. The big question is what are we 10 00:00:30,520 --> 00:00:33,160 Speaker 1: going to learn about it, if anything. Joining us now 11 00:00:33,200 --> 00:00:36,760 Speaker 1: is Seth Waxman, partner at Dickinson Right in Washington, d C. 12 00:00:36,960 --> 00:00:40,080 Speaker 1: He is also a former federal prosecutor in the District 13 00:00:40,360 --> 00:00:43,120 Speaker 1: of Columbia. Seth, thank you so much for being with us. 14 00:00:43,159 --> 00:00:45,559 Speaker 1: I want to start there. What do you expect to 15 00:00:45,640 --> 00:00:50,360 Speaker 1: learn when the Mueller report does come out? Well, good morning. 16 00:00:50,680 --> 00:00:53,280 Speaker 1: With regards to the Mueller report, I expect to see 17 00:00:53,320 --> 00:00:56,400 Speaker 1: a fulsome description of the Mueller investigation. I know there's 18 00:00:56,440 --> 00:00:59,280 Speaker 1: been some discussion of a summary report. I just don't 19 00:00:59,280 --> 00:01:01,040 Speaker 1: see that happy thing. I think that this is a 20 00:01:01,080 --> 00:01:04,520 Speaker 1: two year investigation. Mr Mueller and his team have dedicated 21 00:01:04,520 --> 00:01:06,800 Speaker 1: an incredible amount of time and effort to this, and 22 00:01:06,840 --> 00:01:09,720 Speaker 1: it's such in the American people's interest to see the 23 00:01:10,160 --> 00:01:13,679 Speaker 1: full scope of that investigation, obviously taking out any national 24 00:01:13,760 --> 00:01:17,800 Speaker 1: security type of confidential information or classified information. But I 25 00:01:18,160 --> 00:01:20,360 Speaker 1: just don't believe that we're going to see a truncated 26 00:01:20,400 --> 00:01:23,280 Speaker 1: report or something that really doesn't explain to the American 27 00:01:23,360 --> 00:01:26,800 Speaker 1: people exactly what happened and why. So that's just for 28 00:01:26,880 --> 00:01:31,680 Speaker 1: an audience who exactly decides what gets released. So the 29 00:01:31,720 --> 00:01:35,440 Speaker 1: report Mr Mueller generates will be given to the Attorney General, 30 00:01:35,480 --> 00:01:38,399 Speaker 1: and by the Special Council regulations, it is the Attorney 31 00:01:38,440 --> 00:01:41,880 Speaker 1: General that will decide, uh, you know what to release 32 00:01:41,880 --> 00:01:44,520 Speaker 1: the Congress and then of course to the American people. 33 00:01:45,040 --> 00:01:48,720 Speaker 1: And so in in theory, Mr Bahar could send across 34 00:01:48,840 --> 00:01:52,480 Speaker 1: a truncated report or or refused to send it in fact, 35 00:01:52,600 --> 00:01:55,360 Speaker 1: but he's on record by saying he wants to make 36 00:01:55,400 --> 00:01:58,440 Speaker 1: it available to the greatest extent possible. The only reservation 37 00:01:58,560 --> 00:02:01,760 Speaker 1: he gives is, you know, for national security reasons or 38 00:02:01,800 --> 00:02:05,600 Speaker 1: classified information. In my in my opinion, Mr Mueller knows 39 00:02:05,680 --> 00:02:09,160 Speaker 1: that and will write a report that's likely exercise those 40 00:02:09,200 --> 00:02:12,520 Speaker 1: portions out or put them into a separate addendum, so 41 00:02:12,639 --> 00:02:15,760 Speaker 1: the report he hands over will be either a sanitized 42 00:02:15,760 --> 00:02:17,520 Speaker 1: in such a way as that it could be released 43 00:02:17,520 --> 00:02:19,880 Speaker 1: to the public in full. Is that It's sort of 44 00:02:19,880 --> 00:02:23,080 Speaker 1: interesting because a lot of commentators are saying that probably 45 00:02:23,080 --> 00:02:27,239 Speaker 1: the Mueller investigation won't have a smoking gun, probably won't 46 00:02:27,280 --> 00:02:30,400 Speaker 1: result in further indictments. Do you think that there is 47 00:02:30,480 --> 00:02:35,760 Speaker 1: evidence to support that view? Well, it's all speculation. Um, 48 00:02:35,800 --> 00:02:37,760 Speaker 1: you know, in my opinion, I think that there are 49 00:02:37,760 --> 00:02:40,960 Speaker 1: allegations that that would support criminal charges and and a 50 00:02:41,000 --> 00:02:43,880 Speaker 1: referral to Congress. I don't think that Mr Mueller will 51 00:02:43,919 --> 00:02:45,880 Speaker 1: indict a sitting president. I'm on the side of the 52 00:02:45,919 --> 00:02:49,200 Speaker 1: fence that a sitting president cannot be indicted. That it's 53 00:02:49,200 --> 00:02:51,840 Speaker 1: an impeachment proceeding that I would have to take place, 54 00:02:51,880 --> 00:02:54,200 Speaker 1: and then if a criminal charge were to be filed, 55 00:02:54,240 --> 00:02:57,280 Speaker 1: it would take place after that. But um, you know, 56 00:02:57,360 --> 00:02:59,680 Speaker 1: I think there is from what we know publicly, we 57 00:02:59,760 --> 00:03:02,560 Speaker 1: have this Just to take one example, this very critical 58 00:03:02,639 --> 00:03:06,200 Speaker 1: June ninth Trump Tower meeting where the Russians were offering 59 00:03:06,240 --> 00:03:08,840 Speaker 1: dirt on Hillary Clinton and the people. The Russians that 60 00:03:08,880 --> 00:03:12,000 Speaker 1: were in that meeting worked for companies whose sole purpose 61 00:03:12,320 --> 00:03:15,040 Speaker 1: was to reduce or eliminate sanctions on Russians. I think 62 00:03:15,040 --> 00:03:17,600 Speaker 1: it'd be very naive to think that when the Russians 63 00:03:17,600 --> 00:03:20,080 Speaker 1: came in and offered that dirt on Hillary Clinton that 64 00:03:20,160 --> 00:03:23,600 Speaker 1: they weren't seeking something in return, especially given the company 65 00:03:23,600 --> 00:03:26,359 Speaker 1: they represented. So if that in fact took place a 66 00:03:26,560 --> 00:03:29,480 Speaker 1: quid pro quo in exchange for dirt on Hillary Clinton 67 00:03:29,560 --> 00:03:33,359 Speaker 1: for reduction or promise to reduce or eliminate sanctions, that 68 00:03:33,400 --> 00:03:38,280 Speaker 1: fits into several federal bribery staff or federal statutes, including bribery. 69 00:03:38,480 --> 00:03:41,400 Speaker 1: So um, we know that from the public record as 70 00:03:41,440 --> 00:03:43,760 Speaker 1: to what we what we've learned from the Mller investigation, 71 00:03:43,800 --> 00:03:46,840 Speaker 1: I think that, along with several other areas, are are 72 00:03:47,040 --> 00:03:50,200 Speaker 1: very um rife with potential criminal conduct. And I just 73 00:03:50,240 --> 00:03:52,600 Speaker 1: don't see, you know, at this stage of the game, 74 00:03:52,720 --> 00:03:56,000 Speaker 1: Mr Mueller, you know, after two years walking away without 75 00:03:56,120 --> 00:04:00,080 Speaker 1: some um referral to Congress that impugnes the press and 76 00:04:00,160 --> 00:04:02,960 Speaker 1: into one degree or another. So seth, let's just say 77 00:04:03,000 --> 00:04:06,920 Speaker 1: that something less than the full report is released. What 78 00:04:07,240 --> 00:04:12,160 Speaker 1: are the options for Congress. Well, Congress can conduct its investigations, 79 00:04:12,200 --> 00:04:14,880 Speaker 1: can move forward using the report as a basis to 80 00:04:15,480 --> 00:04:20,160 Speaker 1: launch additional investigations, they could move forward and learn facts 81 00:04:20,160 --> 00:04:23,120 Speaker 1: that cause them uh, either things they know now or 82 00:04:23,160 --> 00:04:27,920 Speaker 1: that they learn to UM convene UH convene impeachment proceedings 83 00:04:28,000 --> 00:04:30,719 Speaker 1: or to make referrals to other U. S. Attorney's offices 84 00:04:30,760 --> 00:04:33,839 Speaker 1: for federal prosecution. So while you know, whatever the Mueller 85 00:04:34,120 --> 00:04:37,760 Speaker 1: report says, it does not necessarily end the matter. UM. 86 00:04:37,800 --> 00:04:40,159 Speaker 1: And of course there are other U. S. Attorney's offices 87 00:04:40,200 --> 00:04:42,960 Speaker 1: across the country, including s d N Y most importantly, 88 00:04:43,000 --> 00:04:47,320 Speaker 1: that are conducting UH investigations, also state investigators, especially in 89 00:04:47,320 --> 00:04:50,320 Speaker 1: New York, that have ongoing investigations. But you know, in 90 00:04:50,360 --> 00:04:53,440 Speaker 1: my opinion, what this comes down to is Mueller versus Trump, 91 00:04:53,440 --> 00:04:55,719 Speaker 1: and you know, it's that's the headline, that's the main 92 00:04:55,800 --> 00:04:58,039 Speaker 1: movie we've all come to want to see. And to 93 00:04:58,080 --> 00:05:02,440 Speaker 1: the extent Mr Mueller exonerates or walks Mr Trump, you know, 94 00:05:02,520 --> 00:05:05,159 Speaker 1: that is a obviously a huge victory for Mr Trump. 95 00:05:05,160 --> 00:05:08,880 Speaker 1: And while those other investigations may or will likely continue forward, 96 00:05:08,880 --> 00:05:12,279 Speaker 1: it's my opinion that if Mr Trump is exonerated by 97 00:05:12,400 --> 00:05:14,800 Speaker 1: Mr Muller, or at least you know not, you're not 98 00:05:15,279 --> 00:05:19,719 Speaker 1: referred for impeachment proceedings or criminal charges. UM. That that's 99 00:05:19,760 --> 00:05:22,040 Speaker 1: really the big, the big to do in this, and 100 00:05:22,120 --> 00:05:24,400 Speaker 1: so it'll be very interesting to see what happens. Yeah, 101 00:05:24,480 --> 00:05:27,599 Speaker 1: just piggybacking on that. We did get the headlines earlier 102 00:05:27,640 --> 00:05:31,920 Speaker 1: today saying that New York State prosecutors are preparing charges 103 00:05:32,000 --> 00:05:36,200 Speaker 1: for Paul Manaford if President Trump does decide to pardon him. 104 00:05:36,440 --> 00:05:38,880 Speaker 1: You mentioned sd I W sd N Y, the Southern 105 00:05:38,960 --> 00:05:42,000 Speaker 1: District of New York, UH, the U. S. Attorney's Office 106 00:05:42,120 --> 00:05:45,000 Speaker 1: in Manhattan, And I'm wondering we've been hearing about the 107 00:05:45,040 --> 00:05:48,880 Speaker 1: investigation that's ongoing there into the Trump organization. Who do 108 00:05:48,920 --> 00:05:51,120 Speaker 1: you think that will involve him? And is it just 109 00:05:51,520 --> 00:05:54,120 Speaker 1: couldn't go up to President Trump himself or does this 110 00:05:54,279 --> 00:05:58,520 Speaker 1: involve some peripheral characters as well as relatives of his No, 111 00:05:58,680 --> 00:05:59,960 Speaker 1: I think it could reach all the way up to 112 00:06:00,080 --> 00:06:02,240 Speaker 1: Mr Trump himself. I mean he was the CEO of 113 00:06:02,279 --> 00:06:05,719 Speaker 1: this five oh one C three A a charitable organization, 114 00:06:05,800 --> 00:06:09,760 Speaker 1: and so when in that area, when individuals make donations 115 00:06:09,800 --> 00:06:13,200 Speaker 1: to charitable organizations, UM, there's a mandate as to how 116 00:06:13,240 --> 00:06:15,320 Speaker 1: that money should be used and if that money is 117 00:06:15,400 --> 00:06:19,960 Speaker 1: diverted away from those purposes altruistic purposes, whether it's you know, 118 00:06:20,080 --> 00:06:23,240 Speaker 1: giving to the Boy Scouts or your local community organization 119 00:06:23,360 --> 00:06:26,880 Speaker 1: or whatever the purposes that this charitable foundation was constructed. 120 00:06:27,200 --> 00:06:30,360 Speaker 1: When money is diverted away from those two personal gains, 121 00:06:30,400 --> 00:06:33,400 Speaker 1: like a personal portrait put up in a golf one 122 00:06:33,400 --> 00:06:35,520 Speaker 1: of Trump golf courses, or the many other things that 123 00:06:35,560 --> 00:06:39,160 Speaker 1: we've heard about, that is deceptive, that is fraudulent, and 124 00:06:39,400 --> 00:06:41,839 Speaker 1: on the federal level, it could be charged as wire fraud. 125 00:06:42,240 --> 00:06:45,240 Speaker 1: On the state level, it could be brought allegations can 126 00:06:45,279 --> 00:06:47,760 Speaker 1: be brought as they are by the New York Attorney General. 127 00:06:47,839 --> 00:06:51,120 Speaker 1: So to the extent Mr Trump, the President participated in 128 00:06:51,120 --> 00:06:53,920 Speaker 1: that was the beneficiary of it, you know, knowingly and 129 00:06:54,000 --> 00:06:58,919 Speaker 1: intentionally um fostered that scheme, he could be implicated. So 130 00:06:59,080 --> 00:07:01,320 Speaker 1: that's just on the report. What is your sense of 131 00:07:01,400 --> 00:07:03,520 Speaker 1: timing here? We we kind of hear reports that it 132 00:07:03,520 --> 00:07:05,560 Speaker 1: could be really any day now. Is that in infect 133 00:07:05,560 --> 00:07:08,400 Speaker 1: your your sense as well? Yeah, Again, this is the 134 00:07:08,440 --> 00:07:11,240 Speaker 1: world of speculation that we're all in, where we're hearing 135 00:07:11,360 --> 00:07:13,600 Speaker 1: things that make us think that the report may be 136 00:07:13,720 --> 00:07:16,240 Speaker 1: in the offing. Of course, Mr Barr is on record 137 00:07:16,280 --> 00:07:19,880 Speaker 1: now saying it's coming. Mr Rosenstein, who months ago said 138 00:07:19,920 --> 00:07:23,480 Speaker 1: he wouldn't leave the Justice Department until the report was 139 00:07:23,560 --> 00:07:26,560 Speaker 1: going to be issued, and and now he's announced his departure. 140 00:07:26,640 --> 00:07:29,680 Speaker 1: We're hearing, I don't know, reports of prosecutors on the 141 00:07:29,720 --> 00:07:33,360 Speaker 1: Special Prosecutor Council's team boxing up boxes and reaching out 142 00:07:33,360 --> 00:07:37,120 Speaker 1: to former employees to see where their next job may lie. 143 00:07:37,600 --> 00:07:39,440 Speaker 1: You know, you take all that together, it seems like 144 00:07:39,480 --> 00:07:43,200 Speaker 1: we're heading towards a critical mass of this report being issued. 145 00:07:43,240 --> 00:07:46,240 Speaker 1: Whether that's next week or in the coming weeks, it's 146 00:07:46,280 --> 00:07:48,880 Speaker 1: it's difficult to say, but you know, we have you know, 147 00:07:48,920 --> 00:07:50,840 Speaker 1: by all accounts, we've reached the top of the ladder, 148 00:07:50,920 --> 00:07:54,040 Speaker 1: or Mr Mueller has, you know, he's gone after Mannerfurt Stone, 149 00:07:54,160 --> 00:07:57,400 Speaker 1: all the other prime targets, the two that stand out 150 00:07:57,440 --> 00:07:59,920 Speaker 1: that haven't been addressed, or of course Donald Trump Jr. 151 00:08:00,120 --> 00:08:03,240 Speaker 1: And Jared Kushner. But what we don't know is if 152 00:08:03,440 --> 00:08:06,240 Speaker 1: Mr especially with regards to an interview of those people, 153 00:08:06,240 --> 00:08:08,960 Speaker 1: but Mr Mueller may have requested that interview, and if 154 00:08:09,160 --> 00:08:12,600 Speaker 1: their lawyers had said they'll plead the fifth Um, then 155 00:08:12,840 --> 00:08:15,640 Speaker 1: there is nothing no interview to take place. And you know, 156 00:08:15,680 --> 00:08:19,040 Speaker 1: if if if those individual lawyers have kept their mouth shut, 157 00:08:19,520 --> 00:08:23,120 Speaker 1: we never know that Great Seth really appreciate it. Seth Waxman, 158 00:08:23,200 --> 00:08:27,160 Speaker 1: partner at Dickinson right in Washington, d C. On the 159 00:08:27,280 --> 00:08:44,599 Speaker 1: Mueller investigation, which should be announced soon. The way that 160 00:08:44,679 --> 00:08:49,480 Speaker 1: companies are community communicating I'm trying to communicate communicating with 161 00:08:49,520 --> 00:08:54,120 Speaker 1: their customers is changing dramatically in a time of artificial intelligence. 162 00:08:54,320 --> 00:08:57,359 Speaker 1: Our next guest is very familiar with that. Chris Grinarchy 163 00:08:57,440 --> 00:09:01,640 Speaker 1: is chief financial officer of Live Person, which reported earnings yesterday, 164 00:09:01,760 --> 00:09:05,480 Speaker 1: shares surging today in a response up seven and a 165 00:09:05,480 --> 00:09:07,920 Speaker 1: half percent. Chris joins us here in our Bloomberg Interactive 166 00:09:07,920 --> 00:09:10,640 Speaker 1: Brokers Studios. Chris, thank you so much for being here. 167 00:09:11,240 --> 00:09:14,079 Speaker 1: Let's start with what is Live Person? Yeah? First of all, 168 00:09:14,080 --> 00:09:16,640 Speaker 1: great to be with y'all. Uh. Live Person is a 169 00:09:16,760 --> 00:09:21,400 Speaker 1: leading provider to Fortune five companies conversational commerce solutions that 170 00:09:21,640 --> 00:09:25,720 Speaker 1: enables them to digitally transform how they engage with their consumers. Okay, 171 00:09:25,720 --> 00:09:28,280 Speaker 1: and then in English? Sure, Uh, when was the last 172 00:09:28,280 --> 00:09:29,720 Speaker 1: time he dialed at one hundred number? And how did 173 00:09:29,760 --> 00:09:36,000 Speaker 1: you feel afterwards? Uh? Did not, So you have to 174 00:09:36,040 --> 00:09:38,000 Speaker 1: force yourself to do it. Uh, and it's not a 175 00:09:38,000 --> 00:09:40,560 Speaker 1: pleasant experience afterwards. Brands are catching up with that. We 176 00:09:40,640 --> 00:09:45,960 Speaker 1: believe that we're past the point of inevitability where consumer 177 00:09:46,000 --> 00:09:50,520 Speaker 1: behavior of messaging over using voice UH is here and companies, 178 00:09:50,559 --> 00:09:53,679 Speaker 1: now brands are catching up with that, and we are 179 00:09:53,800 --> 00:09:56,440 Speaker 1: enabling them to be where their consumers are, whether that's 180 00:09:56,480 --> 00:10:01,400 Speaker 1: on Apple, business Chat, Google, Alexa, WhatsApp, are creating the 181 00:10:01,440 --> 00:10:04,199 Speaker 1: integrations that allow them to directly connect their consumers in 182 00:10:04,240 --> 00:10:06,560 Speaker 1: a way that's transforming. So what are some of the 183 00:10:06,679 --> 00:10:08,520 Speaker 1: examples of some of the companies that have used your 184 00:10:08,520 --> 00:10:11,320 Speaker 1: service successfully and you know kind of what's been their 185 00:10:11,360 --> 00:10:16,160 Speaker 1: success story. Sure, T Mobile is one of our clients. 186 00:10:16,160 --> 00:10:19,959 Speaker 1: T Mobiles really an early adopter in this phase. T 187 00:10:20,120 --> 00:10:22,600 Speaker 1: Mobile has gone to the lengths of actually turning off 188 00:10:22,600 --> 00:10:26,959 Speaker 1: their I vr U, creating a team of experts, their 189 00:10:27,000 --> 00:10:30,680 Speaker 1: interactive voice response kind of systems. So when you call it, yes, 190 00:10:31,280 --> 00:10:36,720 Speaker 1: I needed to definition, no problem, UH, which informed team 191 00:10:36,760 --> 00:10:39,320 Speaker 1: of experts. So you are now assigned a team of 192 00:10:39,360 --> 00:10:41,560 Speaker 1: experts to you. You can message the same way you 193 00:10:41,559 --> 00:10:44,040 Speaker 1: message friends and family. You reached them through the app, 194 00:10:44,520 --> 00:10:48,160 Speaker 1: through SMS, through Apple business Chat, UH, and it's been 195 00:10:48,200 --> 00:10:52,280 Speaker 1: transformative to their customer first focus. So you just reported 196 00:10:52,280 --> 00:10:57,200 Speaker 1: earnings yesterday, UH forecast nine adjusted a ten to fifteen 197 00:10:57,240 --> 00:11:00,679 Speaker 1: million dollars. You expect modest losses is in the first 198 00:11:00,679 --> 00:11:04,320 Speaker 1: half of this year due to hiring plans, but you 199 00:11:04,360 --> 00:11:07,640 Speaker 1: see renewed a profit in the second half hiring plans. 200 00:11:07,800 --> 00:11:12,000 Speaker 1: Who are you hiring? Is it just computers to program themselves? Uh, 201 00:11:12,400 --> 00:11:17,199 Speaker 1: we're hiring people. Uh. We we do. We do purchase 202 00:11:17,240 --> 00:11:19,559 Speaker 1: a lot of servers. Uh. But let me start first 203 00:11:19,640 --> 00:11:23,120 Speaker 1: actually with what's driving that. And if you look at 204 00:11:23,160 --> 00:11:25,920 Speaker 1: the company's growth performance, we had a sixteen points swing 205 00:11:25,920 --> 00:11:28,920 Speaker 1: and our revenue growth rates from two thousand seventeen two eighteen, 206 00:11:28,960 --> 00:11:31,520 Speaker 1: so we posted fourteen percent growth this year off of 207 00:11:31,559 --> 00:11:34,840 Speaker 1: a down two and seventeen uh. This year, we signaled 208 00:11:34,840 --> 00:11:36,920 Speaker 1: that by the fourth quarter will be at high teens 209 00:11:37,720 --> 00:11:42,400 Speaker 1: range accelerating to at least So what's driving that demand 210 00:11:42,480 --> 00:11:45,839 Speaker 1: environment for us? We have pipelines that are uh, so 211 00:11:45,920 --> 00:11:49,880 Speaker 1: we have that high quality opportunity of having our pipelines 212 00:11:49,920 --> 00:11:52,880 Speaker 1: outpace our sales capacity right now. And pipelines in this 213 00:11:52,920 --> 00:11:56,440 Speaker 1: industry means companies basically saying we are going to want 214 00:11:56,440 --> 00:11:59,000 Speaker 1: your services, We're going to contract with you, we'll start 215 00:11:59,000 --> 00:12:01,320 Speaker 1: paying it out over time. It's exactly right. So the 216 00:12:01,400 --> 00:12:04,880 Speaker 1: number of companies that are interested in conversational commerce. If 217 00:12:04,880 --> 00:12:06,880 Speaker 1: you look at the count of those opportunities is up 218 00:12:06,920 --> 00:12:09,439 Speaker 1: eight percent just over the last six months, So that 219 00:12:09,520 --> 00:12:11,960 Speaker 1: demand is surging to the point where we need to 220 00:12:11,960 --> 00:12:14,000 Speaker 1: now catch up with our sales capacity. So in order 221 00:12:14,000 --> 00:12:16,120 Speaker 1: to get as much in your yield as we can 222 00:12:16,160 --> 00:12:18,199 Speaker 1: to get them productive as quickly as we can, we're 223 00:12:18,200 --> 00:12:20,520 Speaker 1: interested in hiring them in the first and second quarters. 224 00:12:20,880 --> 00:12:24,360 Speaker 1: So what's what's your competition? What's the competitive marketplace for 225 00:12:24,440 --> 00:12:28,120 Speaker 1: your service? Your technology? We replace voice anywhere where there's 226 00:12:28,160 --> 00:12:31,199 Speaker 1: a voice call, we're replacing it with messaging, and increasingly 227 00:12:31,240 --> 00:12:35,000 Speaker 1: messaging that's fully automated through bots in AI. So think 228 00:12:35,000 --> 00:12:38,560 Speaker 1: of Nuance Genesis of Allah. Those are the folks that 229 00:12:38,600 --> 00:12:42,080 Speaker 1: were displacing in their call centers. What's the hardest thing 230 00:12:42,480 --> 00:12:50,040 Speaker 1: about a call to replicate using artificial intelligence? You best 231 00:12:50,120 --> 00:12:52,760 Speaker 1: practice is not to fully replicate it. Actually, the best 232 00:12:52,760 --> 00:12:56,200 Speaker 1: practice is to pair a bot with a human. You 233 00:12:56,280 --> 00:12:58,360 Speaker 1: all have probably as much as you've been frustrated with 234 00:12:58,360 --> 00:13:00,200 Speaker 1: a one hundred number before, you could be equal as 235 00:13:00,200 --> 00:13:03,600 Speaker 1: frustrated as a generic bot experience where you're you're either 236 00:13:03,679 --> 00:13:05,320 Speaker 1: on a web chat or on a message, you're trying 237 00:13:05,320 --> 00:13:08,520 Speaker 1: to get something back and it just default completely wrong answer. 238 00:13:08,840 --> 00:13:11,160 Speaker 1: So the best practice is actually to pair that human 239 00:13:11,280 --> 00:13:13,200 Speaker 1: with the body. We call it a tango situation, just 240 00:13:13,240 --> 00:13:17,240 Speaker 1: like the dance and UH. The difficult part, if you will, 241 00:13:17,800 --> 00:13:20,280 Speaker 1: is the routing and knowing what the intent of you 242 00:13:20,320 --> 00:13:23,440 Speaker 1: and I UH in our conversations is. We take in 243 00:13:23,559 --> 00:13:26,679 Speaker 1: tens of millions of conversations a month, so data is 244 00:13:26,720 --> 00:13:29,160 Speaker 1: one of the motes of the company. And when you 245 00:13:29,240 --> 00:13:31,680 Speaker 1: can take in that amount of data, you can then 246 00:13:31,720 --> 00:13:35,160 Speaker 1: predict intense and you can then pair those intents with responses, 247 00:13:35,160 --> 00:13:38,439 Speaker 1: so the agent consider their console and the bot can 248 00:13:38,480 --> 00:13:41,520 Speaker 1: be continuously making recommendations for how to response, so now 249 00:13:41,559 --> 00:13:44,120 Speaker 1: they can be much more productive. So a great example 250 00:13:44,160 --> 00:13:46,360 Speaker 1: of that is if I'm handling a call that can 251 00:13:46,400 --> 00:13:48,600 Speaker 1: handle one at a time, right unless I'm really skilled, 252 00:13:48,600 --> 00:13:50,280 Speaker 1: but most people can only handle one call at a time. 253 00:13:50,880 --> 00:13:53,240 Speaker 1: I know we try many times, we're not successful in 254 00:13:53,440 --> 00:13:58,040 Speaker 1: in a web chat scenario, maybe four to six. You 255 00:13:58,040 --> 00:14:01,480 Speaker 1: can scale to forty messages at a time when you're 256 00:14:01,920 --> 00:14:04,280 Speaker 1: in a messaging format, and then you can scale too 257 00:14:04,280 --> 00:14:06,559 Speaker 1: close to a hundred when automation is in bed. So 258 00:14:06,679 --> 00:14:09,760 Speaker 1: think about the productivity that now comes into play with 259 00:14:09,800 --> 00:14:12,920 Speaker 1: the consumers and the customers that we serve every day. Fascinating. 260 00:14:12,960 --> 00:14:14,760 Speaker 1: Thank you so much for being here. Well, thank you 261 00:14:14,800 --> 00:14:17,880 Speaker 1: all appreciate. Chris Grinder is CFO, Chief Financial Officer of 262 00:14:18,040 --> 00:14:37,480 Speaker 1: Live Person, based in New York. Well, it looks like 263 00:14:37,480 --> 00:14:40,920 Speaker 1: Philadelphia has sued seven banks, including JP, Morgan Chase, and 264 00:14:41,000 --> 00:14:44,720 Speaker 1: Bank of America, accusing them of costing local governments billions 265 00:14:44,720 --> 00:14:47,480 Speaker 1: of dollars by colluding to fix prices on floating rate 266 00:14:47,520 --> 00:14:51,640 Speaker 1: bonds issued to public to finance public finance work. So 267 00:14:51,680 --> 00:14:54,600 Speaker 1: it helps dig down into this issue. Is Joe Mysak 268 00:14:54,720 --> 00:14:58,360 Speaker 1: Joe as editor of Bloomberg Brief, covering the municipal market 269 00:14:58,360 --> 00:15:00,360 Speaker 1: for Bloomberg News. He joins us in our boom Brick 270 00:15:00,360 --> 00:15:03,840 Speaker 1: Interactive Brooker Studio here in New York. So, Joe, is 271 00:15:03,880 --> 00:15:06,600 Speaker 1: this suit in Philadelphia similar to what we've seen in 272 00:15:06,760 --> 00:15:09,760 Speaker 1: California and in Illinois? And what's what's going on here? 273 00:15:10,080 --> 00:15:15,480 Speaker 1: Oh baby? This lawsuit sixty pages is the complaint and 274 00:15:15,640 --> 00:15:20,280 Speaker 1: it reads like how did Truman Capodi describe in Cold 275 00:15:20,280 --> 00:15:25,720 Speaker 1: Blood a nonfiction novel? The narrative flow is powerful in 276 00:15:25,760 --> 00:15:30,480 Speaker 1: this thing. Yes, it's very similar. It's it's similar to 277 00:15:30,560 --> 00:15:35,680 Speaker 1: the key Tam lawsuits that were filed in California, Illinois, 278 00:15:35,760 --> 00:15:40,600 Speaker 1: New York, and Massachusetts, in that it says, excuse me, 279 00:15:42,320 --> 00:15:48,480 Speaker 1: a group of remarketing agents of variable rate demand obligations conspired, 280 00:15:48,600 --> 00:15:54,680 Speaker 1: they colluded, There was collusion to inflate prices on these instruments. 281 00:15:55,240 --> 00:15:59,800 Speaker 1: And the difference between the key Tam lawsuit and this 282 00:15:59,800 --> 00:16:04,320 Speaker 1: this is an antitrust lawsuit where a municipal issue itself 283 00:16:04,400 --> 00:16:09,640 Speaker 1: says you ripped us off, meaning they're seeking class class 284 00:16:09,680 --> 00:16:13,720 Speaker 1: status for this lawsuit. The key Tam lawsuit is where 285 00:16:13,720 --> 00:16:17,560 Speaker 1: a whistle blower comes in and says, we are suing 286 00:16:17,680 --> 00:16:22,240 Speaker 1: on behalf of this state and its municipalities because they 287 00:16:22,240 --> 00:16:26,040 Speaker 1: have been ripped off. And this is just, uh, this 288 00:16:26,200 --> 00:16:29,200 Speaker 1: is the biggest thing to hit the municipal market in 289 00:16:29,760 --> 00:16:32,640 Speaker 1: probably a decade. Okay, let's get a sense of the 290 00:16:32,880 --> 00:16:37,120 Speaker 1: scope of the potential losses for municipalities selling bonds as 291 00:16:37,160 --> 00:16:44,720 Speaker 1: a result of this alleged collusion between banks. Billions billions 292 00:16:44,800 --> 00:16:49,760 Speaker 1: they cost municipality or the investor or both taxpayers. This 293 00:16:50,040 --> 00:16:55,200 Speaker 1: taxpayers might sure shore pays a higher rate to borrow 294 00:16:55,280 --> 00:16:58,920 Speaker 1: money than it might normally, and how much higher just 295 00:16:58,960 --> 00:17:02,680 Speaker 1: in rate terms? Well, they said, actually that vr d 296 00:17:02,680 --> 00:17:05,800 Speaker 1: O rates were about I think twenty seven basis points 297 00:17:05,920 --> 00:17:13,160 Speaker 1: higher than they should have been, VRDO being variable rate denominations. Okay, uh, 298 00:17:13,200 --> 00:17:15,840 Speaker 1: and uh, you know, little things mean a lot, so 299 00:17:15,920 --> 00:17:19,000 Speaker 1: a quarter basis point. Yeah, and you know rates were 300 00:17:19,119 --> 00:17:23,320 Speaker 1: very low at this period, we know, what about two 301 00:17:23,320 --> 00:17:28,280 Speaker 1: thousand and eight, two and and this is amazing, they say, 302 00:17:28,280 --> 00:17:35,879 Speaker 1: by a round members of the cartel, as the complaint puts, it, 303 00:17:36,720 --> 00:17:40,879 Speaker 1: caught onto the fact that they were being uh investigated 304 00:17:40,960 --> 00:17:45,040 Speaker 1: and surveilled, if you will. And after that then the 305 00:17:45,119 --> 00:17:49,760 Speaker 1: vr d O rates sort of normalized and it's just, uh, 306 00:17:50,000 --> 00:17:53,760 Speaker 1: it's very you know, these are all allegations. You know, 307 00:17:54,000 --> 00:17:57,480 Speaker 1: jury trial demanded. Still, as I say, it makes for 308 00:17:57,520 --> 00:18:01,919 Speaker 1: a compelling narrative. So, Joe, we've had these suits, are 309 00:18:02,080 --> 00:18:04,080 Speaker 1: similar types of suits all around the country. Have you 310 00:18:04,160 --> 00:18:07,160 Speaker 1: had any resolution or if we had any scenario where 311 00:18:07,200 --> 00:18:10,000 Speaker 1: we could see what the banks are saying and what 312 00:18:10,160 --> 00:18:12,800 Speaker 1: what's what's their argument banks are? Well, the banks have 313 00:18:12,920 --> 00:18:16,680 Speaker 1: been you know, they did respond in Illinois and asked 314 00:18:16,720 --> 00:18:20,919 Speaker 1: that the complaint be dismissed, and the judge in Illinois said, no, 315 00:18:22,119 --> 00:18:24,760 Speaker 1: you know, your motion to dismiss is denied. We're going 316 00:18:24,800 --> 00:18:29,640 Speaker 1: ahead with this trial. Everywhere else those are those three states. 317 00:18:30,440 --> 00:18:33,040 Speaker 1: The process is moving along, and man, that takes the 318 00:18:33,119 --> 00:18:35,720 Speaker 1: lawyer is a while to get things going. So here's 319 00:18:35,760 --> 00:18:39,399 Speaker 1: my question. So banks got together and they said, we're 320 00:18:39,400 --> 00:18:41,239 Speaker 1: going to set the rates here so that if the 321 00:18:41,400 --> 00:18:44,720 Speaker 1: municipality tries to go out and shop around for a 322 00:18:44,720 --> 00:18:47,480 Speaker 1: better rate, they can't get one. Right, is that the 323 00:18:47,520 --> 00:18:53,720 Speaker 1: idea here? Not exactly this is this reset But but no, 324 00:18:53,840 --> 00:18:56,960 Speaker 1: it's that, you know, is this new issue? This is 325 00:18:57,560 --> 00:19:01,320 Speaker 1: you know, bonds that are out there. Okay, so every 326 00:19:01,359 --> 00:19:03,960 Speaker 1: week they're reselling them, and the banks get together and 327 00:19:04,000 --> 00:19:06,640 Speaker 1: they say, this is the price that we are going 328 00:19:06,680 --> 00:19:10,160 Speaker 1: to sell them at. And then the implication is shouldn't 329 00:19:10,160 --> 00:19:14,600 Speaker 1: evenalities want to borrow? They have to borrow at the 330 00:19:14,680 --> 00:19:19,040 Speaker 1: higher rate, the cartel rates. But so here's my question. 331 00:19:19,160 --> 00:19:23,800 Speaker 1: Are the banks profiting from this or is it their customers? Oh? No, 332 00:19:23,920 --> 00:19:28,320 Speaker 1: the banks would profit from this because what they The 333 00:19:28,400 --> 00:19:32,240 Speaker 1: essential argument here is that the investor, which sometimes included 334 00:19:32,680 --> 00:19:37,080 Speaker 1: subsidiaries of the banks themselves, Um, the investor would be 335 00:19:37,119 --> 00:19:40,159 Speaker 1: so happy with the rates he has that he doesn't 336 00:19:40,240 --> 00:19:44,639 Speaker 1: put the bonds back, which is the normal process. So 337 00:19:44,680 --> 00:19:47,359 Speaker 1: if you put the bonds back, these banks would have 338 00:19:47,400 --> 00:19:50,200 Speaker 1: to remarket them. So by keeping the rates high enough, 339 00:19:50,840 --> 00:19:55,160 Speaker 1: they kept the investors happy out there getting that higher yield, 340 00:19:56,160 --> 00:20:00,240 Speaker 1: and you know, the issuers are paying up and there 341 00:20:00,680 --> 00:20:02,400 Speaker 1: you know, there's a lid on the market. They would 342 00:20:02,440 --> 00:20:04,600 Speaker 1: never have to sit there and say, okay, we have 343 00:20:04,680 --> 00:20:06,760 Speaker 1: to remark at the bonds now and look for a 344 00:20:06,800 --> 00:20:08,960 Speaker 1: whole new set of investors. So they were marking the 345 00:20:09,000 --> 00:20:12,680 Speaker 1: bonds at lower prices than where they should have otherwise 346 00:20:12,720 --> 00:20:17,879 Speaker 1: been implying higher rates, and that was the objective. Fascinating story. 347 00:20:18,080 --> 00:20:20,080 Speaker 1: Thank you so much for being with us. Joe Maisak, 348 00:20:20,440 --> 00:20:23,040 Speaker 1: editor of the Bloomberg Brief, focused on the miss bond 349 00:20:23,080 --> 00:20:26,680 Speaker 1: market here in our eleven three oh studios in New York. 350 00:20:26,920 --> 00:20:31,640 Speaker 1: Really interesting story, really interesting issue that is evolving. Frankly, 351 00:20:31,800 --> 00:20:34,160 Speaker 1: it's a question to me on one hand, yes it's 352 00:20:34,160 --> 00:20:36,199 Speaker 1: a civil lawsuit, but you have to wonder at what 353 00:20:36,320 --> 00:20:40,880 Speaker 1: point other agencies come in if there is actual price manipulation, 354 00:20:40,880 --> 00:20:56,520 Speaker 1: which is essentially what the allegation here is. There is 355 00:20:56,560 --> 00:21:00,440 Speaker 1: a big debate brewing in credit markets. Has the US 356 00:21:00,520 --> 00:21:03,760 Speaker 1: high old bond market gone too far too fast? And 357 00:21:03,840 --> 00:21:06,480 Speaker 1: joining us here in our Bloombergetder Active Broker Studios is 358 00:21:06,600 --> 00:21:09,280 Speaker 1: Rob Waldner to answer that question. Rob Waldner is chief 359 00:21:09,359 --> 00:21:13,159 Speaker 1: strategist and head of multi sector fixed Income at Invesco, 360 00:21:13,400 --> 00:21:16,480 Speaker 1: hoping to oversee more than two hundred billion dollars. Thank 361 00:21:16,520 --> 00:21:18,359 Speaker 1: you so much for being here, Rob, So where do 362 00:21:18,400 --> 00:21:20,240 Speaker 1: you weigh in on this. Is it's a time to 363 00:21:20,400 --> 00:21:23,439 Speaker 1: still be buying the US high old bond market or 364 00:21:23,520 --> 00:21:26,520 Speaker 1: is it a time to step back and reduce risk? Well, 365 00:21:26,560 --> 00:21:28,640 Speaker 1: thank you for having me, Lisa. I think that the 366 00:21:28,640 --> 00:21:31,640 Speaker 1: the short answer is you want to have credit exposure 367 00:21:31,640 --> 00:21:34,400 Speaker 1: in your portfolio to get your yield, and combine that 368 00:21:34,480 --> 00:21:37,280 Speaker 1: with a duration at this part of the cycle argues 369 00:21:37,359 --> 00:21:41,119 Speaker 1: for having highled exposure in your portfolio. When we you know, 370 00:21:41,160 --> 00:21:42,840 Speaker 1: we'd like to compare everything to the start of the 371 00:21:42,880 --> 00:21:44,120 Speaker 1: year or the end of the year, and it looks 372 00:21:44,160 --> 00:21:46,360 Speaker 1: like high yield has rallied an awful lot this year. 373 00:21:46,840 --> 00:21:48,520 Speaker 1: But you know, we would say that end of the 374 00:21:48,600 --> 00:21:51,520 Speaker 1: year was a was a sort of strike a price 375 00:21:51,560 --> 00:21:54,000 Speaker 1: that was set in the midst of a fed potentially 376 00:21:54,000 --> 00:21:56,280 Speaker 1: making a policy mistake. So to compare it to the 377 00:21:56,320 --> 00:21:57,760 Speaker 1: end of the year is probably not the right way 378 00:21:57,760 --> 00:22:00,199 Speaker 1: to think about HI yield. So rob, I mean, we 379 00:22:00,240 --> 00:22:04,080 Speaker 1: have the U S economy UH slowing UM from last year, 380 00:22:04,119 --> 00:22:06,959 Speaker 1: it's coming into here to. We have the uncertainty in 381 00:22:07,000 --> 00:22:10,240 Speaker 1: Europe and the growth rates there. You know, Brexit's not 382 00:22:10,320 --> 00:22:12,600 Speaker 1: helping at all. And then of course China is slowing. 383 00:22:12,640 --> 00:22:14,720 Speaker 1: Whether it's six or six and a percent, who knows. 384 00:22:14,960 --> 00:22:17,879 Speaker 1: But given the slowing global macro economy, how are you 385 00:22:17,920 --> 00:22:22,040 Speaker 1: positioning your portfolio? So it is absolutely true the global 386 00:22:22,040 --> 00:22:24,760 Speaker 1: economy is slowing. The US is were packed pet past 387 00:22:24,880 --> 00:22:27,719 Speaker 1: peak growth, were relatively late cycle in the growth cycle, 388 00:22:28,720 --> 00:22:32,040 Speaker 1: and investors are caught between that and the policymakers. And 389 00:22:32,080 --> 00:22:33,920 Speaker 1: what we see is when you have slowing growth and 390 00:22:33,960 --> 00:22:35,960 Speaker 1: tighter policy like we did the end of last year, 391 00:22:36,400 --> 00:22:39,120 Speaker 1: it's a mess for the markets. But the Fed has relented, 392 00:22:39,359 --> 00:22:43,040 Speaker 1: we think may reset essentially going forward UM to be 393 00:22:43,119 --> 00:22:45,680 Speaker 1: much more accommodative. We know that the Chinese have become 394 00:22:45,760 --> 00:22:48,960 Speaker 1: much more accommodative. UH. They've introduced a number of different 395 00:22:48,960 --> 00:22:52,200 Speaker 1: stimulus measures, so that the policy making has been much 396 00:22:52,240 --> 00:22:55,560 Speaker 1: more accommodative in the last several months, offsetting that that 397 00:22:55,600 --> 00:22:59,200 Speaker 1: lower growth. So we're struck between slowing growth and accommodative policy, 398 00:22:59,560 --> 00:23:02,199 Speaker 1: which means it's not a massive bowl market, but you 399 00:23:02,240 --> 00:23:03,879 Speaker 1: want to own your credit and you want to own 400 00:23:04,240 --> 00:23:07,119 Speaker 1: your duration. So if there is a mistake and the 401 00:23:07,119 --> 00:23:10,119 Speaker 1: slowing growth overwhelms, you will get some protection from that duration. 402 00:23:10,240 --> 00:23:14,400 Speaker 1: I hear a little voice screaming behind him. Goldilocks, Goldilocks, goldilocks. 403 00:23:14,520 --> 00:23:15,960 Speaker 1: I mean, it seems like is a sort of the 404 00:23:15,960 --> 00:23:18,600 Speaker 1: perfect scenario for credit, and that's why you've got JP Morgan, 405 00:23:18,640 --> 00:23:21,840 Speaker 1: for example, raising it's US high O bond market forecast 406 00:23:21,880 --> 00:23:24,760 Speaker 1: for ten and a half percent from its prior a 407 00:23:24,800 --> 00:23:28,359 Speaker 1: percent prediction today. Yeah, well, it's not goldilocks, because goldilocks 408 00:23:28,359 --> 00:23:30,800 Speaker 1: you'd have to have. I think the growth picture be 409 00:23:30,840 --> 00:23:33,280 Speaker 1: a little bit better. We will get some volatility, but 410 00:23:33,320 --> 00:23:36,119 Speaker 1: what you do have is a grind. So it's not 411 00:23:36,160 --> 00:23:40,080 Speaker 1: the perfect environment, but it is definitely a grind going forward. 412 00:23:40,280 --> 00:23:42,560 Speaker 1: So do you do you recommend I mean, given of 413 00:23:42,600 --> 00:23:44,600 Speaker 1: alatility we've seen in the market over the lasting of 414 00:23:44,640 --> 00:23:46,879 Speaker 1: four or five months, the slowing growth, are you reckoning 415 00:23:46,960 --> 00:23:49,760 Speaker 1: Are you feeling comfortable going out duration a little bit 416 00:23:49,840 --> 00:23:51,880 Speaker 1: farther on the curve or do you prefer to stay 417 00:23:51,880 --> 00:23:55,720 Speaker 1: in a little bit tighter. Uh. For the last several 418 00:23:55,800 --> 00:23:58,720 Speaker 1: years we've been a rising rate environment and investors have 419 00:23:58,760 --> 00:24:02,560 Speaker 1: wanted to stay short messages weren't a risen rate environment, 420 00:24:03,040 --> 00:24:06,159 Speaker 1: and in that environment you want to get some duration 421 00:24:06,160 --> 00:24:09,639 Speaker 1: back into your portfolio because as bond investors, we know 422 00:24:10,240 --> 00:24:13,959 Speaker 1: the best offset to credit exposure if credit exposure going 423 00:24:13,960 --> 00:24:16,320 Speaker 1: to go poorly is a bit of duration. So if 424 00:24:16,320 --> 00:24:18,640 Speaker 1: you can offset your credit exposure to get it gets 425 00:24:18,640 --> 00:24:21,679 Speaker 1: you yield with some duration for protection you have, you 426 00:24:21,760 --> 00:24:23,639 Speaker 1: have the best set up. Is there going to be 427 00:24:23,680 --> 00:24:27,000 Speaker 1: another credit crisis ever? Again? Well not for not during 428 00:24:27,000 --> 00:24:30,280 Speaker 1: my career, I don't think, because we've had How long 429 00:24:30,320 --> 00:24:32,040 Speaker 1: do you plan to stay in the in the business? 430 00:24:32,160 --> 00:24:34,399 Speaker 1: I mean, really I'm wondering because it seems like everybody 431 00:24:34,400 --> 00:24:36,480 Speaker 1: has been, you know, screaming at the sky is falling 432 00:24:36,760 --> 00:24:40,560 Speaker 1: at every downturn ever since two thousand and eight because 433 00:24:40,640 --> 00:24:43,439 Speaker 1: it was so scarring. But is it going to be 434 00:24:43,480 --> 00:24:45,600 Speaker 1: a repeat or now? So look at the FED put 435 00:24:45,600 --> 00:24:48,240 Speaker 1: out their Financial Stability Report, you know, last year at 436 00:24:48,240 --> 00:24:50,479 Speaker 1: the end of last year, and they highlighted I mean 437 00:24:50,520 --> 00:24:52,640 Speaker 1: it's very clear if you go through the details of that, 438 00:24:52,960 --> 00:24:56,239 Speaker 1: there really isn't the tinder for a liquidity crisis if 439 00:24:56,280 --> 00:24:59,879 Speaker 1: you like, right there is even in China, even in India. Well, 440 00:25:00,520 --> 00:25:02,960 Speaker 1: so China that the benefit of China has is a 441 00:25:03,040 --> 00:25:05,600 Speaker 1: very large closed system and they can control the leverage 442 00:25:06,000 --> 00:25:08,480 Speaker 1: within their within their system and control their own policymaking. 443 00:25:08,600 --> 00:25:12,479 Speaker 1: So um, you know there could be some individual Uh, 444 00:25:12,960 --> 00:25:16,200 Speaker 1: there's there's gonna be credit events, certainly, especially with a 445 00:25:16,240 --> 00:25:18,800 Speaker 1: slowing economy as we go. As economy continues to slow, 446 00:25:18,840 --> 00:25:21,840 Speaker 1: you will get credit events. You'll get idiosyncratic events. But 447 00:25:21,880 --> 00:25:25,320 Speaker 1: a liquidity crisis would say that the entire system kind 448 00:25:25,320 --> 00:25:27,720 Speaker 1: of contracts together, and I don't expect to see that. 449 00:25:28,000 --> 00:25:30,880 Speaker 1: So Rob, how about the UK? Is that does brexit 450 00:25:30,920 --> 00:25:35,040 Speaker 1: make that market almost untouchable until you get some clarification 451 00:25:35,160 --> 00:25:38,399 Speaker 1: or there's some values there? Well, there's values there. Uh. 452 00:25:38,600 --> 00:25:42,000 Speaker 1: The we believe that we believe the chance of a 453 00:25:42,040 --> 00:25:45,240 Speaker 1: heart brexit is very low. But that being said, uh, 454 00:25:45,240 --> 00:25:48,880 Speaker 1: if in order to realize the value that you see, 455 00:25:49,280 --> 00:25:51,560 Speaker 1: you've got to get some sort of something other than 456 00:25:51,600 --> 00:25:52,960 Speaker 1: a heart break that you either have to have a 457 00:25:53,800 --> 00:25:56,320 Speaker 1: you know, punt punt that decision or a sort of 458 00:25:56,400 --> 00:26:00,000 Speaker 1: soft brexit. So we need some activity to realize the value. 459 00:26:00,119 --> 00:26:02,760 Speaker 1: But it's undoubted that sterling is trading too cheap, and 460 00:26:02,880 --> 00:26:05,000 Speaker 1: we would look a lot of the assets sterling assets 461 00:26:05,000 --> 00:26:07,639 Speaker 1: and say, hey, they're trading trading too cheap. What was 462 00:26:07,720 --> 00:26:10,720 Speaker 1: the biggest move that you've made recently to your thesis 463 00:26:10,720 --> 00:26:15,800 Speaker 1: and those recommendations with respect to sector allocations. So the 464 00:26:15,840 --> 00:26:17,720 Speaker 1: biggest move that we've made in the last couple of 465 00:26:17,760 --> 00:26:21,400 Speaker 1: months is to add essentially move from a short duration 466 00:26:21,800 --> 00:26:25,760 Speaker 1: excuse me, from a short credit long dration view to 467 00:26:26,160 --> 00:26:28,679 Speaker 1: a long credit long draation for you to add that 468 00:26:28,720 --> 00:26:33,159 Speaker 1: credit back into portfolios and keep that duration. So we 469 00:26:33,400 --> 00:26:36,800 Speaker 1: would be overweight duration portfolios and a slightly overweight credit 470 00:26:36,960 --> 00:26:41,080 Speaker 1: because this environment where you created value in the credit markets, 471 00:26:41,320 --> 00:26:43,680 Speaker 1: but you still have the risk of slowing. Those two 472 00:26:43,720 --> 00:26:45,760 Speaker 1: come together quite well. Well, you don't know it, but 473 00:26:45,840 --> 00:26:48,840 Speaker 1: Friday's is Muni days here on Bluemorg markets. So where 474 00:26:48,840 --> 00:26:51,800 Speaker 1: do Muni's may know it? Maybe he does, Maybe it's 475 00:26:51,800 --> 00:26:55,320 Speaker 1: an avid listener um. Where do Munis fit into your 476 00:26:55,440 --> 00:27:00,399 Speaker 1: view of kind of the fixing come portfolio? So you know, 477 00:27:00,440 --> 00:27:03,440 Speaker 1: we have a so our view of Munis. Obviously they 478 00:27:03,640 --> 00:27:07,240 Speaker 1: you know, they have there sort of distinct from a 479 00:27:07,240 --> 00:27:09,119 Speaker 1: lot of the tax bill markets because of course they 480 00:27:09,119 --> 00:27:11,840 Speaker 1: have the special tax resumption, right but so we we 481 00:27:11,880 --> 00:27:14,359 Speaker 1: think about metis right here is offering opportunities. You know, 482 00:27:14,400 --> 00:27:17,119 Speaker 1: we think that uh, there's a lot of people who 483 00:27:17,160 --> 00:27:19,240 Speaker 1: will be surprised that they didn't get much of a 484 00:27:19,320 --> 00:27:21,359 Speaker 1: tax cut when they're doing the taxes in the next 485 00:27:21,760 --> 00:27:24,320 Speaker 1: month or so. Uh, they didn't get the tax cut 486 00:27:24,320 --> 00:27:26,159 Speaker 1: that they thought they were going to get. Uh. And 487 00:27:26,200 --> 00:27:29,320 Speaker 1: we'll renew interested metis and so we think that that 488 00:27:29,320 --> 00:27:32,439 Speaker 1: that's will be relatively good technical demand for meetings. And 489 00:27:32,480 --> 00:27:35,600 Speaker 1: at the same time, you know, the the decent growth 490 00:27:35,640 --> 00:27:38,000 Speaker 1: continuous to support the fundamentals in the meti market. Is 491 00:27:38,040 --> 00:27:44,720 Speaker 1: there any asset that you won't touch right now? Um, 492 00:27:45,160 --> 00:27:51,880 Speaker 1: good question? Uh wheels, Yeah, you know, the German boons, 493 00:27:52,359 --> 00:27:55,439 Speaker 1: Italian band, we'd be very we would be a bit 494 00:27:55,480 --> 00:27:58,439 Speaker 1: nervous about itly, I think that yeah, Um, you know, 495 00:27:58,720 --> 00:28:01,360 Speaker 1: ultimately the medium picture in Italy, it's hard to see 496 00:28:01,359 --> 00:28:04,720 Speaker 1: how we make it through. Um, in the medium tournament 497 00:28:04,760 --> 00:28:06,640 Speaker 1: our view, there's you know, with the amount of debt 498 00:28:06,680 --> 00:28:09,080 Speaker 1: that's there, and if if we don't get growth up, uh, 499 00:28:09,160 --> 00:28:11,439 Speaker 1: there could be potential for some some issue in Italy. 500 00:28:11,480 --> 00:28:13,520 Speaker 1: But back in the US, high old markets are there, 501 00:28:13,560 --> 00:28:15,480 Speaker 1: what's the best value you see in the US high 502 00:28:15,520 --> 00:28:19,880 Speaker 1: yield market sector was Uh, well, you know, we we 503 00:28:20,040 --> 00:28:22,040 Speaker 1: believe that at this point in the cycle right where 504 00:28:22,040 --> 00:28:24,560 Speaker 1: you have potential for a lot of idiosyncratic stuff. You 505 00:28:24,560 --> 00:28:27,479 Speaker 1: saw Kraft Hines right now, right, you have this slowing growth, 506 00:28:27,840 --> 00:28:30,960 Speaker 1: you really want to diversify credit bucket, So we would 507 00:28:31,000 --> 00:28:33,119 Speaker 1: actually recommend a bit of invest and created a bit 508 00:28:33,119 --> 00:28:38,760 Speaker 1: of high yield. Uh, maybe some bank loans across the board. Good, excellent, Rob, 509 00:28:38,800 --> 00:28:41,280 Speaker 1: Thank you very much for your insight on all things 510 00:28:41,320 --> 00:28:44,320 Speaker 1: fixed income. That's Rob Waldner, chief strategist and head of 511 00:28:44,480 --> 00:28:47,400 Speaker 1: multi sector for Investco Fixed Income a little over two 512 00:28:47,760 --> 00:28:52,000 Speaker 1: billion dollars in assets under management. Thanks for listening to 513 00:28:52,000 --> 00:28:54,440 Speaker 1: the Bloomberg P and L podcast. You can subscribe and 514 00:28:54,440 --> 00:28:57,600 Speaker 1: listen to interviews at Apple Podcasts or whatever podcast platform 515 00:28:57,640 --> 00:29:00,760 Speaker 1: you prefer. Paul Sweeney, I'm on Twitter at pt Sweeney. 516 00:29:00,800 --> 00:29:03,680 Speaker 1: I'm Lisa abram Woods. I'm on Twitter at Lisa abramo Woods. 517 00:29:03,720 --> 00:29:06,600 Speaker 1: One Before the podcast, you can always catch us worldwide 518 00:29:06,600 --> 00:29:07,560 Speaker 1: on Bloomberg Radio.