Speaker 1: This is Bloomberg Business Week. I'm Carol Masser and I'm
Speaker 1: Jason Kelly. We're here every day bringing you the latest
Speaker 1: news from the world of business and finance, plus technology, politics, economics,
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Speaker 1: also listen to our radio show weekdays at two pm
Speaker 1: Eastern only on Bloomberg Radio. Now. There are a lot
Speaker 1: of discussions going on about a vaccine in the race
Speaker 1: for a vaccine, a lot of news coverage over the weekend.
Speaker 1: Um and our next guest and his team have been
Speaker 1: facing the virus from day one in this country. They
Speaker 1: the first US case of the virus actually confirmed in
Speaker 1: Washington State at Providence Regional Medical Center in Everett, Massive
Speaker 1: Hospital System Overall. Dr Rod Hawkman is President and CEO
Speaker 1: of Providence Health. He joins us on the phone from Seattle.
Speaker 1: Dr Hawkman, nice to have you back with us. I
Speaker 1: hope you guys are doing well. Help us. We always
Speaker 1: kind of lean on you to kind of make sense
Speaker 1: of some of the headlines that are out there. Uh.
Speaker 1: And as you see this race for the virus, what's
Speaker 1: what should we as individuals expect realistically about how we
Speaker 1: get there and when we get there? Oh? Sure, And
Speaker 1: I think the best way to think of that as
Speaker 1: I was talking to a group of folks that try
Speaker 1: to you know, they say every time we listen you know,
Speaker 1: on TV. Uh, you know, we don't know who to believe.
Speaker 1: So I think it starts out with you know, we're
Speaker 1: going to get better at treating this virus. So you
Speaker 1: saw with rom visivie now being approved and you know,
Speaker 1: we are first patient that we had in the United States,
Speaker 1: we actually treated with one visivie three months ago. And
Speaker 1: what we're going to see are some other medications that
Speaker 1: are going to be added to that in kind of
Speaker 1: a cocktail to see if we can really improve patients
Speaker 1: that get sick and hopefully prevent death. So that's one
Speaker 1: thing that I think the public can start to say, well,
Speaker 1: that's a good tranche of research and work that's going on.
Speaker 1: On the other side of it is the race for
Speaker 1: the back scene, where you know, there's probably more than
Speaker 1: fifteen trials that are ongoing, which is fantastic, and we
Speaker 1: have a lot of cooperation going on between the scientists
Speaker 1: with the different trials out there, And to kind of
Speaker 1: explain it to listeners, it's it's picking different parts of
Speaker 1: the virus and seeing which one of those parts is
Speaker 1: gonna give you immunity. And so that's in simple terms.
Speaker 1: You know, why would there be fifteen different trials because
Speaker 1: they're also all looking at different aspects of the virus
Speaker 1: to see which one seems to be as I would say,
Speaker 1: the most immunogenic and the ones that can confer immunity.
Speaker 1: So and then there's an issue of whether you use
Speaker 1: DNA or RNA, which from your biology from high school
Speaker 1: has all different consequences. There are some companies that are
Speaker 1: looking for a faster turnaround on their vaccine. Uh, we're
Speaker 1: still we're cautiously hopeful about that, but you know that
Speaker 1: remains to be seen, you know, so that the most
Speaker 1: optimistic estimates are sometime in the late all towards the
Speaker 1: end of the year, and the most realistic are probably
Speaker 1: in the first quarter of next year. UM for a vaccine,
Speaker 1: that's what that's what most of us are looking at.
Speaker 1: In the in the clinical and scientific community, and so
Speaker 1: Dr Hakman, as you look across the country and and
Speaker 1: you drawing the experience that you've had there in Washington State,
Speaker 1: you see this sort of checkerboard that we keep describing of,
Speaker 1: you know, different states sort of coming back at different times.
Speaker 1: But part of that is a response to how the
Speaker 1: virus has played out in different geographies, different urban areas
Speaker 1: versus suburban versus rural. What makes the most sense in
Speaker 1: terms of the medical side and in terms of what
Speaker 1: we should be doing before we have a vaccine? What
Speaker 1: what makes the most sense. Yeah, I I just talked
Speaker 1: to the Business Roundtable on Friday. We're trying to make
Speaker 1: some sense for the CEOs around the country about what
Speaker 1: they should do. And it's all very very dependent upon
Speaker 1: your geography and your density. So when I think about,
Speaker 1: you know, giving advice to different organizations companies, the first
Speaker 1: question I asked, are where are you in the country,
Speaker 1: because it will make a different depending on where those
Speaker 1: states and localities are on the curve of number of cases.
Speaker 1: And then the second thing that's really important is the
Speaker 1: density of the work environment. So are you able to
Speaker 1: spread people out? Can you spread customers out can you
Speaker 1: do some of that which will help really really decrease
Speaker 1: risk and exposure. So it's almost you almost have to
Speaker 1: go through a checklist of the things that you do
Speaker 1: in your business or where you are to kind of
Speaker 1: understand what the best practices are and some of us are.
Speaker 1: We're actually putting together kind of some of those guidelines
Speaker 1: so that these are the things that you look for
Speaker 1: and these are the things that will decrease your risk significantly.
Speaker 1: And then a little bit of this is going to
Speaker 1: be we gotta see what happens in the country. We're
Speaker 1: gonna learn a lot. Certain places will teach us a
Speaker 1: lot in our in our environment, Alaska's wide open and
Speaker 1: open for business. Um, you know, again not a lot
Speaker 1: of density, but we're also going to learn a lot
Speaker 1: by doing that. What are the things that we have
Speaker 1: to look out for. What about something like mass transportation
Speaker 1: in a city like New York, How do you see
Speaker 1: that moving forward? Wow, that is a tough one. That
Speaker 1: is a really really hard one to think about, because
Speaker 1: those are the situations where, you know, if you ask
Speaker 1: me as a physician, that worry us the most. When
Speaker 1: you've got a crowded subway car that has few people
Speaker 1: in it in close proximity. How do you do that?
Speaker 1: And I don't know whether it's going to take limiting
Speaker 1: some of that transportation obviously everyone wearing a mask, because
Speaker 1: there's no question that if everyone wore a mask, it
Speaker 1: will decrease significantly the transmission rate of this virus, even
Speaker 1: if they're not what people have on. So some of that,
Speaker 1: and then you know, you know, not touching anything. If
Speaker 1: I got on a subway, as soon as I got off,
Speaker 1: I'd be, you know, washing my hands, doing all those
Speaker 1: kinds of things. So I think we're going to have
Speaker 1: to make some accommodation and probably limiting you know, we
Speaker 1: can't have a packed subway car. So are there ways
Speaker 1: that we kind of limit the number of people? But
Speaker 1: those are going to be some of the tough ones
Speaker 1: that we're going to have to solve. Yeah, it's such
Speaker 1: a good point. I mean, this whole question of density
Speaker 1: I think is certainly very friend of mine for those
Speaker 1: of us here in the Tri state area. Dr Rod Hochman,
Speaker 1: thank you so much, really just great insights. President and
Speaker 1: CEO of probably in St. Joseph Health joining us on
Speaker 1: the phone from Seattle, Carroll and the other thing. He said,
Speaker 1: You know, we're just gonna have to wait and see
Speaker 1: what happens as we reopened to see do we all
Speaker 1: of a sudden get a spike in cases or have
Speaker 1: we created some kind of herd immunity. Although we use
Speaker 1: that phrase, would be very careful about how we use
Speaker 1: it because and I think also comparing and contrasting what
Speaker 1: happens in different regions and trying to figure out what
Speaker 1: the variables are is really really important. You're listening to
Speaker 1: Bloomberg Business Week with Carol Messer and Jason Kelly on
Speaker 1: Bloomberg Radio. All right, he's a Jedi in his own right.
Speaker 1: Kevin Cirilli, our chief Washington correspondent, joining us from Washington,
Speaker 1: keeping track of all the comings and goings the next
Speaker 1: leg of the stimulus. It ain't gonna be easy, keV.
Speaker 1: What's going on? It's not. Did you guys see what
Speaker 1: President Trump said the other night. He says that he's
Speaker 1: on board for a next round of economic stimulus looking
Speaker 1: in in the next month or so or early summer,
Speaker 1: provided it include the payroll tax cut. So the payroll
Speaker 1: tax cut is the bargaining chip from the White House,
Speaker 1: and they say no deal unless they include the payroll
Speaker 1: tax cut. So looking beyond that in terms of where
Speaker 1: this goes from here, well, remind us exactly what the
Speaker 1: Paill tax cut is. Well, it would allow for businesses
Speaker 1: in order to qualify for for large businesses and medium
Speaker 1: sized businesses as well to qualify for some some tax
Speaker 1: relief as it relates to keeping some individuals on their
Speaker 1: on their payroll. And so especially at a time in
Speaker 1: which the people are having this conversation about furloughs and
Speaker 1: laying people off, many of these businesses on Main Street
Speaker 1: in Wall Street, they want to make sure, uh that
Speaker 1: that you know that they're going to be able to
Speaker 1: have that. This actually happened if you think pre COVID,
Speaker 1: this was another debacle during the Obama White House, but
Speaker 1: also pre COVID during the tax uh, the tax debate.
Speaker 1: But another thing that I'm really interested in is where
Speaker 1: the conversation shifts in terms of policy, uh with China
Speaker 1: and how Democrats and Republicans this is becoming increasingly a
Speaker 1: nonpartisan issue. Yeah, So tell us more about that, because
Speaker 1: we're gonna have a big deep dive into China at
Speaker 1: the top of the hour with uh Andy Brown. What's
Speaker 1: the political side of this, keV. Well, the political side
Speaker 1: is threefold. First and foremost, from a from a congressional standpoint,
Speaker 1: there is a host of different legislation that was that
Speaker 1: existed prior to COVID, but even during this is getting
Speaker 1: re It relates to five G and businesses and in
Speaker 1: the United States being able to do business with European
Speaker 1: companies that might be uh, you know, working with Huawei
Speaker 1: and other Chinese firms uh. And Secondly, from a higher
Speaker 1: education standpoint, there could be new regulatory structures domestically U
Speaker 1: pertaining to China's ability to impact higher education. And finally,
Speaker 1: I would you cannot talk about this in an election
Speaker 1: year without mentioning the presidential election. And so I think
Speaker 1: you're going to hear the administration and you heard this
Speaker 1: from President Trump in his Fox Newstown hall last night,
Speaker 1: increasingly taking a tougher tone against China and Beijing as
Speaker 1: he did with with regards to tariffs. But from the
Speaker 1: democratic perspective and Biden's orbit, they're going to say that
Speaker 1: this is why they would argue they should come in
Speaker 1: and be able to have a better relationship with Europe
Speaker 1: so that the US and Europe can work together to
Speaker 1: combat some of the inconsistencies. To put it mildly, coming
Speaker 1: from from Beijing, I gotta say, I don't know if
Speaker 1: any of you saw sixty minutes over the weekend, and
Speaker 1: it was all it was all about, right, you know
Speaker 1: the impact of the virus. It was gut wrenching, to
Speaker 1: say the least in terms of small business owners. You know,
Speaker 1: people still waiting on checks. And then the whole piece
Speaker 1: about farmers who we know already got some aid earlier,
Speaker 1: um you know, from the Trump administration because of tariffs,
Speaker 1: speaking in the fight between US and China, and yet
Speaker 1: you know they're not getting especially the smaller players not
Speaker 1: getting assistants. I do think any increased trade tensions we're
Speaker 1: talking about another hit to the economy potentially here. And
Speaker 1: that's such a good point because if you think back
Speaker 1: to when we were covering the U. S. And China
Speaker 1: and how Beijing really saw the heartland America as as
Speaker 1: a way to specifically get the president's attention because that's
Speaker 1: the base of his political coalition. And so you're absolutely right,
Speaker 1: it looks like we're headed towards more of a more
Speaker 1: volatility on the U. S. China economic front, and one
Speaker 1: more thing that I would I should mention is that
Speaker 1: the World Health Organization and there is a legislation bipartisan
Speaker 1: but also coming from intelligence community sources and from the
Speaker 1: administration obviously questions about shi Jing Ping's relationship with the
Speaker 1: World Health Organization and vice versa. Yeah, and all of
Speaker 1: that is sort of backdrop or maybe foreground to this
Speaker 1: very difficult relationship that we're seeing continue between President Trump
Speaker 1: and President she Kevin Cirelli always made it. He works at,
Speaker 1: as Tom Keene would say, such a high velocity that
Speaker 1: you just get. It's like convinced he doesn't sleep, but
Speaker 1: you just jam so much in a very short amount
Speaker 1: of time. Love that guy. Uh. And he's also very
Speaker 1: fun to follow on Twitter, as you know, kept at
Speaker 1: kept Sarelli lots lots of lots of flexing, lots of
Speaker 1: the little flexing emojis. It's good, It's good, all right.
Speaker 1: Kevin Surli is our chief Washington correspondent. As you heard
Speaker 1: Charlie mentioned, if you're in the DC area, check out
Speaker 1: his show. It's called Sound on Uh. It's on Bloomberg
Speaker 1: one in DC at five pm, well street time. You're
Speaker 1: listening to Bloomberg Business Week. How Master along with Jason Kelly,
Speaker 1: and I feel like Jason, a little bit of what
Speaker 1: we just talked to for our New York audience about
Speaker 1: the Amazon and engineer who quit in protest about how
Speaker 1: Amazon is treating some of its workers fits into this
Speaker 1: next story. It's in the magazine this week, and it's
Speaker 1: really fascinating because throughout this virus pandemic, we've been talking
Speaker 1: about essential workers, right and hopefully it's made all of
Speaker 1: us realize how important they are. Some of the workers
Speaker 1: that I think it's fair to say that a lot
Speaker 1: of us have taken for granted before the virus. So
Speaker 1: a story in the magazine, as I mentioned, takes us
Speaker 1: back to nine o two to help us really think
Speaker 1: about these essential workers. Susan Burfield is Projects and Investigations
Speaker 1: report at Bloomberg News from Brooklyn. She wrote this story.
Speaker 1: We'll get to her in a moment, but with us
Speaker 1: right now is Bluemberg Business Week itor Joe Webber on
Speaker 1: the phone from Brooklyn and Jill, Jason and I were
Speaker 1: just talking about um Amazon, which, as you know, it's
Speaker 1: kind of in a bit of a pr nightmare for
Speaker 1: how it's treating some of its warehouse workers and others
Speaker 1: and for getting rid of a whistle blower. But you
Speaker 1: do wonder this pandemic, these social ills that have been
Speaker 1: out there are really being laid bare. You know, how
Speaker 1: we will come out on the other side. Will we
Speaker 1: totally ignore it or will we work to make it
Speaker 1: a better society for every everyone? Uh? You know, there's
Speaker 1: a lot of questions out there. Yeah. So I mean
Speaker 1: I think that you get right to the heart of
Speaker 1: it there, um And and you know, just throughout you know, history,
Speaker 1: there's been these flashpoints and I think, um, one of
Speaker 1: the things that this this shows is like there there
Speaker 1: is always this silent agreement I guess between labor and employers,
Speaker 1: right and when you when you come to a flashpoint
Speaker 1: like this, you know, it lays it bare and like
Speaker 1: a pandemic like foot we're enduring right now, you can
Speaker 1: kind of go through a task of companies and it
Speaker 1: just exposes that in the very essence is like, you know,
Speaker 1: employment and labor. This is a conversation that um, that
Speaker 1: we need to have. And I think the thing that
Speaker 1: you know, if you really want to bring that um
Speaker 1: into focus now, the thing that's really um, I think
Speaker 1: unique uh forever for all times right, is this idea
Speaker 1: of gig employment, and that gig employment thing is um,
Speaker 1: you know, not having a worker who's a full employee.
Speaker 1: I think that is a conversation that we're going to
Speaker 1: just have more and more of than you know. The
Speaker 1: fact that you know, like the state like California has
Speaker 1: sort of been really at the forefront of this shows
Speaker 1: how how some people are are beginning to look at
Speaker 1: that relationship too. And so Susan come on in here.
Speaker 1: Susan Burfield, Projects and investigations reporter for Bloomberg, author of
Speaker 1: this piece and a book, a new book. So tell
Speaker 1: us about what you found about this coal strike, because
Speaker 1: for those of us who don't know about it, there's
Speaker 1: a bit of a wait, what that tell us? How
Speaker 1: this connects? Yeah, So for us, you have to think
Speaker 1: back in nineteen o two, So Theodore Roosevelt was the president. Um,
Speaker 1: he had come to power unexpectedly after McKinley had been
Speaker 1: assassinated by a former factory worker, and so there was
Speaker 1: a general sense of unease. You know, America was an
Speaker 1: industrializing nation, it was urbanizing nation. There was a lot
Speaker 1: of immigration, a lot of the issues intentions that we
Speaker 1: face now. We're very prevalent there. And so when the
Speaker 1: coal uh miners went on strike, UM, Roosevelt at first
Speaker 1: was a little bit unsure about what to do. His
Speaker 1: main concern was social order, but he also wanted to
Speaker 1: show that he, as a president and his administration would
Speaker 1: be on the side of workers and would stand up
Speaker 1: for them when the time came. And so, what is
Speaker 1: the main thing you take away that we should be
Speaker 1: thinking about in the context of the current government and
Speaker 1: maybe even our own sort of commercial or personal response here. Yeah, So,
Speaker 1: you know, the strike lasted five months. UM, winter was approaching.
Speaker 1: There was a real possibility that millions of people would
Speaker 1: be without heat and light. Um, the Post office was
Speaker 1: threatening to shut down, steel mills were threatening to layoff workers,
Speaker 1: and it was a real crisis in America. And you know,
Speaker 1: one of the things it revealed was that the coal
Speaker 1: miners were really the essential workers of their time. And so,
Speaker 1: you know, much like today, it was. Um, it was
Speaker 1: a bit of a shock, you know, for people to
Speaker 1: realize that the kind of luxuries that they have, the
Speaker 1: convenience of their life was dependent on people who were
Speaker 1: often underpaid or poorly paid, were vulnerable, you know, worked
Speaker 1: in dangerous jobs, and what Roosevelt suggested was that it
Speaker 1: wasn't and shouldn't only be up to the companies to
Speaker 1: do right by their workers. So they should, but that
Speaker 1: the government also had a responsibility to step in and
Speaker 1: to protect them and to you know, make sure that
Speaker 1: they were working for a living wage. Um, and that
Speaker 1: really overall it was an economy that worked for everyone.
Speaker 1: So I think those are the lessons and what's hopeful
Speaker 1: about this moment. And then you know what also is
Speaker 1: is uh, as I called it in the piece, kind
Speaker 1: of haunting question that we're all going to be faced with,
Speaker 1: you know, Susan. Um. I also just want to point out, hey,
Speaker 1: first of all, our of fate again, we're talking about
Speaker 1: Susan's book, which we excerpted in the magazine. And just congratulations, uh,
Speaker 1: like just high fives from over here, um, Jason Carroll.
Speaker 1: I got a personal copy. I got a personal copy,
Speaker 1: which actually we did it. We did a socially distant
Speaker 1: um drop off. So she lived it understooped and I
Speaker 1: picked it up, uh, in that in an envelope that
Speaker 1: said Joel on it. So I was like very honored
Speaker 1: with that. People. I want to I want to just um,
Speaker 1: say that. You know, I think that, you know, even
Speaker 1: though it's a historical book, I think there are lessons
Speaker 1: from history that are going to just prove really powerful
Speaker 1: right now. And I think Susan's book gives us a
Speaker 1: sense of that. Um Susan, if I if I could
Speaker 1: kind of bring it, I spent a second of it
Speaker 1: the beginning kind of just talking about gig workers sort
Speaker 1: of being a modern day equivalent. And you know that
Speaker 1: is such a topic now when we think about uber
Speaker 1: drivers or instant cart workers and like they've just we've
Speaker 1: sort of taken them for granted until suddenly we realized,
Speaker 1: you know, all of these people are are on the
Speaker 1: front line in a way that um um are our
Speaker 1: instrument integral to the modern economy. And yet you know,
Speaker 1: we weren't thinking about them in the same way before
Speaker 1: all of this. And you know, California is one model
Speaker 1: of how how a state looking out for people in
Speaker 1: a different way. How would how do you think, uh
Speaker 1: like a Roosevelt would view you know, California's policy and
Speaker 1: all of this, and and is that enough? Yeah, that's
Speaker 1: a really good question. So you know, Roosevelt really ushered
Speaker 1: in the progressive era in America, and it was really
Speaker 1: the first in the time that a president kind of
Speaker 1: came out very directly and said we in the government,
Speaker 1: we as Americans, need to provide a square deal for
Speaker 1: everyone with his term. You know. Then later we had
Speaker 1: the New Deal and we had the Great Society, but
Speaker 1: first there was a square deal, and it was the
Speaker 1: idea that you know, everybody should have, you know, as
Speaker 1: an equal a chance as possible, and that you know,
Speaker 1: everyone should be equally protected. And so while I think
Speaker 1: Roosevelt would be supportive of what California and the other
Speaker 1: state is doing, or for that matter, what any single
Speaker 1: company is doing, he really BELI in the power of
Speaker 1: the federal government. Well, and I have to say, I
Speaker 1: love to this idea of covid capitalism, and we'll have
Speaker 1: to see where the country goes, whether it whether it
Speaker 1: just helps to benefit those that have already benefited a lot,
Speaker 1: or whether we rewrite some of what's been going on
Speaker 1: in our society. Sous In Burfield, check out our book.
Speaker 1: We'll hopefully talk to you more about that and of
Speaker 1: course our thanks to Joe Webern. You're listening to Bloomberg
Speaker 1: Business Week with Carol Masser and Jason Kelly on Bloomberg Radio.
Speaker 1: All right, let's do a little business week economics and
Speaker 1: sort of a special edition today because we want to
Speaker 1: really focus on what's going on between the US and China,
Speaker 1: and we try to catch up this time more or
Speaker 1: less every week with Andy Brown, He's editorial director of
Speaker 1: Bloomberg New Economy, joins us on the phone from New Hampshire,
Speaker 1: and Andy, I have to say, we were talking on
Speaker 1: our planning call earlier today and realizing everything that is
Speaker 1: going on between the US and China. Some comments made
Speaker 1: by both uh, you were the guy we need to
Speaker 1: shock too, So we really appreciate you, uh taking some
Speaker 1: time here give us the context because this has been
Speaker 1: complicated to say the least, but it feels like it
Speaker 1: got turned up to eleven as they say, over the
Speaker 1: past hours. Yeah. So you know, this whole lame game
Speaker 1: between the US and China, as you say, has now
Speaker 1: gone to a whole new level. Um And what's happened
Speaker 1: now is that uh, Donald Trump has threatened UMU China
Speaker 1: with with trade retaliations, um, you know, with tariffs on
Speaker 1: Chinese goods. So you know here you are here, we
Speaker 1: are sort of teetering on the edge. We suddenly on
Speaker 1: the in in a in a recession, teetering on the
Speaker 1: edge of a depression, and the last thing the world
Speaker 1: needs now is a trade war. Uh, And it looks
Speaker 1: as though we may be getting one. Well and yet
Speaker 1: exactly I mean, Andy, it makes me wonder, you know,
Speaker 1: what are the conversations that are going on in the
Speaker 1: White House at this point. But that's you know, it
Speaker 1: was interesting. There was a story we talked about this
Speaker 1: earlier on our broadcast sixty Minutes this weekend, looking at
Speaker 1: farmers who we know were hurt in the trade wars,
Speaker 1: and they're still struggling because they're not necessarily getting some
Speaker 1: of the stimulus money out of these bailout packages. But yeah, this,
Speaker 1: you know, trade tensions are pushback on globalization. Just exacerbates
Speaker 1: what's going on in the economy, the negative side to it,
Speaker 1: and makes it much more difficult to come out of it,
Speaker 1: doesn't it. Right? So you know, people people forget we
Speaker 1: you know, half of all of the tariffs that um
Speaker 1: Trump put on China are still in place, and you
Speaker 1: know it's a myth that the Chinese are paying for
Speaker 1: this and that this is a sort of a net
Speaker 1: budget plus for the US UM US import is of
Speaker 1: course pay these tariffs and then pass it along UM
Speaker 1: to the consumer. And so you know it was bad
Speaker 1: enough UM before before COVID nineteen came along. And now
Speaker 1: you have US consumers who UM, many of whom are
Speaker 1: out of work, paying additional prices UM for basic products.
Speaker 1: So I mean it's an even heavier burden now for
Speaker 1: the U. S economy. And Trump is threatening to reignite
Speaker 1: the whole trade war UM in as retaliation or as
Speaker 1: punishment UM for China's failures in the early stages of
Speaker 1: this pandemic when there was clearly a cover up, UM.
Speaker 1: You know. But but what what what's happening now is
Speaker 1: you have all of these allegations that you know, uh,
Speaker 1: this the COVID nineteen came out of a out of
Speaker 1: a lab in Mouhan. So the scientific community say, look,
Speaker 1: it's possible, um, And this is the consensus of the
Speaker 1: scientific community. It's possible, but not likely. Uh. It probably
Speaker 1: wasn't man made or you know, artificially engineered. Probably came
Speaker 1: out of an animal. And Trump and Pompeo keeps saying, well,
Speaker 1: you know there's evidence, and you're getting this drip drip drip.
Speaker 1: But you know, there is no evidence. So you know,
Speaker 1: right now the Chinese is saying, okay, this plays right
Speaker 1: into their own narrative, which is this all basically it's
Speaker 1: all about the White House deflecting blame for their own,
Speaker 1: uh late catastrophic response at a federal level to to
Speaker 1: the coronavirus. Well, and I do wonder Andy, to how
Speaker 1: much the Chinese not that that you know, this lessens
Speaker 1: the severity of what Trump is doing essentially in in
Speaker 1: impacting the relationships between the two nations even more severely.
Speaker 1: But how much did the Chinese also say he's running
Speaker 1: for re election, he's playing the game again. Well, yeah,
Speaker 1: that that you know that that's that's exactly what they're
Speaker 1: saying that and and and the Chinese, in their own way,
Speaker 1: they're playing, you know, a similar game. So you know,
Speaker 1: you've had statements from Chinese Foreign Ministry spokesman, um, you know,
Speaker 1: spinning this this conspiracy theory that the coronavirus came out
Speaker 1: of the US military during these military games that took place, um,
Speaker 1: you know, in in Buhan. So both sides are playing this.
Speaker 1: But you know, the the this is having real impact
Speaker 1: right now on the economy. The markets are down today
Speaker 1: because they're very worried that in the middle of this
Speaker 1: global pandemic, we may say, see a a interruption of
Speaker 1: trade tensions. And I just saw I just saw that
Speaker 1: the remne b the Chinese currency uh is sliding. It's
Speaker 1: almost at a historic low. Um. You know, as as
Speaker 1: a result of all these tensions. Well, and it's interesting,
Speaker 1: you know, Andy, we heard from Kevin Cirilli, Chief Washington
Speaker 1: correspondent earlier that China feels like something that actually the
Speaker 1: Democrats and Republicans, at least in broad strokes, can kind
Speaker 1: of agree on. Do you agree with that? And what
Speaker 1: are the implications of sort of finding something that finding
Speaker 1: something to agree on in a place where nobody agrees
Speaker 1: about anything. You only have a better minute, lub. Yeah,
Speaker 1: I mean not not only do they are they agreeing
Speaker 1: on it, but I think they're going to be competing
Speaker 1: with each other. Um, it's this election to be to
Speaker 1: be tough on China. Um, you know, it's a it's China.
Speaker 1: China bashing is going to be a central theme I
Speaker 1: think of this or this election, the presidential election. Wow. Yeah, No,
Speaker 1: I mean it's interesting to think about that too, because
Speaker 1: you do see it, you know, coming down on you know,
Speaker 1: even if you're just sort of comparing and contrasting tweets,
Speaker 1: you know between the president and uh presumptive nominee former
Speaker 1: Vice President Joe Biden. Fascinating. Well, uh, you know, we
Speaker 1: asked key deliverous. That's what we love. Andy Brown, great
Speaker 1: context editorial director of Bloomberg New Economy Journius on the
Speaker 1: phone from New Hampshire. Of course, you know, he's the
Speaker 1: former China editor senior corresponding comments for The Wall Street Journal.
Speaker 1: So he and he grew up largely over in Asia
Speaker 1: and Hong Kong and elsewhere and lived in Beijing. So
Speaker 1: he really knows his stuff and knows how complicated but
Speaker 1: also how important this is and how it not going
Speaker 1: well could really have vast long term implications. And that's
Speaker 1: the thing. They're you know, the games being played on
Speaker 1: both sides, right, but there are implications to all of this,
Speaker 1: and we can't forget that, especially when it comes to
Speaker 1: the impact on individuals in each of the countries. You're
Speaker 1: listening to Bloomberg Business Week with Carol Masser and Jason
Speaker 1: Kelly on Bloomberg Radio. Well, it's beginning to look a
Speaker 1: lot like Christmas. Not really, but we know retailer here,
Speaker 1: I know are already starting to think about it, and
Speaker 1: what they're thinking about doesn't look good. I was not
Speaker 1: excited from what it says, but excited to read the
Speaker 1: story because it's so smart. Uh. And by one of
Speaker 1: our top reporters, Matt Townsend, he joins us on the
Speaker 1: phone from Brooklyn. So this isn't great retail sector clearly
Speaker 1: suffering here, Matt, but already Christmas looking grim. Yeah, that's right.
Speaker 1: I mean, you know, there's a lot of thought out
Speaker 1: there that at some point we'll have this nice recovery
Speaker 1: coming into the fourth quarter and consumers will bounce back.
Speaker 1: So we looked at it, and you know, companies like Fitch,
Speaker 1: the ratings company, I mean, they're already baking in as
Speaker 1: much as a temper cent decline in sales for discretionary companies. Um.
Speaker 1: And it really boils down to two things. One the
Speaker 1: consumer they expect, and other firms expect the consumer to
Speaker 1: still be under pressure, whether it's high unemployment, the thread
Speaker 1: of the virus. Also, shopping in a retail environment that
Speaker 1: has all this social distancing might not be that great
Speaker 1: of an experience that could damp in sales. So there's
Speaker 1: a lot of problems with the consumer that could lead
Speaker 1: to a blue what we're calling out quote blue Christmas. Yeah.
Speaker 1: I mean, I just think there are so many questions
Speaker 1: and I think you just hit it, you know, And
Speaker 1: I do wonder what it means for retailers. I mean,
Speaker 1: Macy's is opening up, right, Matt, And I just think
Speaker 1: about do I want to go in there? Where? How
Speaker 1: do you keep a place of those of those you know,
Speaker 1: that size, how do you keep it totally clean? Safe?
Speaker 1: I just think it's difficult. It is, and you know,
Speaker 1: so far we've seen from some of this early states
Speaker 1: opening up, or even for some of the retailers that
Speaker 1: have been opened the whole time, like a Walmart, um,
Speaker 1: you know their or Target, they're having some issues with
Speaker 1: their in store sales. And the other thing is, you
Speaker 1: know people expect, oh well, if people don't want to
Speaker 1: go to stores, alto shop online. But the problem with
Speaker 1: that is online e commerce is a much lower margin
Speaker 1: uh business for most retailers because they have to do
Speaker 1: all the shipping and the return shipping, and then on
Speaker 1: top of that impulse buys. So the whole point of
Speaker 1: a story as you walk in and you buy stuff
Speaker 1: that you didn't go there for. You know, the whole
Speaker 1: thing if you go there to buy milk at the
Speaker 1: grocery store and you end up walking out with a
Speaker 1: full cart. Well, online that doesn't really happen as much.
Speaker 1: So that's that's basically the fundamental way a lot of
Speaker 1: these retailers work. So if more store sales going to
Speaker 1: online could impact margins margins in a big way. Yeah,
Speaker 1: that's really interesting. And also, I mean, not for nothing,
Speaker 1: we could be in a horrible economy by the time
Speaker 1: it gets to Christmas time and you know, people just
Speaker 1: are not gonna wen it be spending a lot of
Speaker 1: money presumably. Yeah, I mean that's you know, it's it's
Speaker 1: hard to model this like it's been set a nausea
Speaker 1: throughout this whole thing is that there's nothing to compare
Speaker 1: this to um. And you know, another thing we wrote
Speaker 1: about in the story is that there's this other side
Speaker 1: to this as well. Whereas you know, retailers are financially distressed. Obviously,
Speaker 1: we saw j Crewe file for bankruptcy in past twenty
Speaker 1: four hours and there's a big question mark about will
Speaker 1: they be be able to even get enough products on
Speaker 1: the shelves to meet demand that the supply chains have
Speaker 1: been upended. And you know, we reported about this a
Speaker 1: couple of times already in the past few weeks. Is
Speaker 1: that vendors are very upset and feel very burned by
Speaker 1: the retail industry because they basically had months of ordered,
Speaker 1: months of orders canceled on them. They're stuck with all
Speaker 1: these goods nowhere to sell them. So there's this frostiness
Speaker 1: between the retailers and their vendors, and you know, it's
Speaker 1: it's becoming dicey to ship to a retailer at this
Speaker 1: point knowing, not knowing what's going to happen. So matt,
Speaker 1: let me just as gives a consumer because I've been
Speaker 1: watching this and you know, my daughter and I like
Speaker 1: if we see something that's online and were like, I'm
Speaker 1: gonna wait because I think these you know, the retailers
Speaker 1: are going to go down. Yeah, totally. And you do
Speaker 1: see it kind of move around a little bit, and
Speaker 1: and how retailers are keeping track of what's in your
Speaker 1: basket and they're like, hey, did you see you know
Speaker 1: now it's on sale. So I do wonder for consumer,
Speaker 1: will there be lots of deals are not necessarily because,
Speaker 1: as you say, supply chains. But I do wonder about
Speaker 1: all that old inventory that's just sitting around and they've
Speaker 1: got to get rid of it. Yeah. No, I think
Speaker 1: there will be deals or there will be you know,
Speaker 1: a flood of inventory going to the discounters and they
Speaker 1: teach mx is of the world, um and the marshals
Speaker 1: and things like that. But there is there is that
Speaker 1: consumer behavior where you're expecting to see bigger discounts at
Speaker 1: this point because you hear the news about all these
Speaker 1: retailers and trouble and for the most part, we haven't
Speaker 1: seen you know, wholesale liquidations of products within anything like that.
Speaker 1: So we got, yeah, talk to us about Jay Crew
Speaker 1: because you know, this is obviously an incredibly well known brand.
Speaker 1: You know, a troubled last decade in many ways for
Speaker 1: the company, specifically some comings and goings at the at
Speaker 1: the very top. What ultimately took it down. You know,
Speaker 1: Jay Crew won over you know a lot of these
Speaker 1: companies they went over a generation of consumers. You know,
Speaker 1: they went over the Gen xers you know, in the
Speaker 1: nineties and every anything like that, and they just were
Speaker 1: never able to win the next generation for whatever reason,
Speaker 1: whether it was competitors fast fashion, Um, you know Mickey
Speaker 1: Drexler obviously the architect of the of the brand. Um,
Speaker 1: did he lose his way? Did the brand lose its way?
Speaker 1: I mean, there's a lot of things are a part
Speaker 1: of this, but a big thing is the consumer really
Speaker 1: just moved on and they never were able to win
Speaker 1: that next generation like my generation love j Crew. The
Speaker 1: generation below us who are now in their early thirties
Speaker 1: twenties did not go to Jay Crew as as as
Speaker 1: as as big as as as much as we did. Yeah. No,
Speaker 1: it's it's really true. They're shopping differently and there and
Speaker 1: there's the whole private equity angle to which which obviously
Speaker 1: uh saddled the company uh with some debt and you know,
Speaker 1: maybe made some decisions that ultimately ultimately took it down.
Speaker 1: So too early to talk Christmas though, No, it is never,
Speaker 1: it's never. And as I said the top of the show, though,
Speaker 1: all I really want for Christmas is a plate of
Speaker 1: your Christmas cookies that you will get a plate of
Speaker 1: car All right, that's good, all right, Matt Town, give
Speaker 1: me the flower, like I said, I'll get you the
Speaker 1: flower that that'll be the deal. That'll be we'll do
Speaker 1: some bartering here in Mattowns and retail reporter for Bloomberg.
Speaker 1: A really great story. It's one of the most read.
Speaker 1: Check it out on the Bloomberg terminal and at Bloomberg
Speaker 1: dot Com. Will send it out via the Twitter as well.
Speaker 1: We need to keep it behind Macy's right, Yes, yeah,
Speaker 1: how they do through all this because they're already in
Speaker 1: a tough state road macro journal. Yeah, but you let
Speaker 1: me drive? No, no, no, no, who's going to drug home? Honey? Please?
Speaker 1: I'll do the riding gravels me. I want to drive,
Speaker 1: just drive, baby questions trying. This is the drive to
Speaker 1: the Globe Commune. Thanks, we'll drying up dawn. On Bloomberg Radio,
Speaker 1: it is time for the drive to the close. David
Speaker 1: Dietz is back with US President and chief investment Officer
Speaker 1: at Point View Wealth Management, joining us once again on
Speaker 1: the phone from Summit, New Jersey. David, nice to have
Speaker 1: you here on a day where we're pretty much now
Speaker 1: at our highs at the set. But it's not been
Speaker 1: a big mover kind of day, but we're definitely off
Speaker 1: our loads. Um tell me you know here we are?
Speaker 1: What week seven week gate here when it comes to
Speaker 1: working from home for many of us with the virus.
Speaker 1: What's your take on the economic outlook, the market outlook,
Speaker 1: and what it all means for investors. So, Carol, uh,
Speaker 1: thanks for having me on here. Um. We really in
Speaker 1: some ways it's almost a more difficult time than it
Speaker 1: was seven weeks ago because here, of course your market
Speaker 1: is up close to from the apparent bottom march. Yet
Speaker 1: there's still tremendous uncertainty as to where we're going with
Speaker 1: the coronavirus. When are we going to see a vaccine,
Speaker 1: When will sufficient testing be done, where the therapeutics and
Speaker 1: so forth. We're getting glimmers of hope. Still nothing definite, um,
Speaker 1: but prices are up higher, and so you know, the
Speaker 1: question is has the low hanging fruit been picked? And
Speaker 1: now should we moved to the sidelines or what. And
Speaker 1: with respect to our clients, basically it's all about your
Speaker 1: time horizon. If you're longer term investor, I think you
Speaker 1: can do well. If you're short term oriented, as you're
Speaker 1: gonna see some voluntil the return. And so where do
Speaker 1: you go here, David? I mean, like, what are the
Speaker 1: types of side So let's assume you've got a long
Speaker 1: term perspective, because if you've got a short term perspective,
Speaker 1: as you said, like, that's a whole different discussion. But
Speaker 1: let's assume you're long term. I gotta ask you because
Speaker 1: it's one of our favorite names to talk to you
Speaker 1: about about Wells Fargo. You sure, so you know here
Speaker 1: we are interest rates or at some of the off
Speaker 1: time lows. In fact, many people are worried about us
Speaker 1: ultimately going negative. Well all low interest rates are an
Speaker 1: athombout the financial service companies. If your insurance company, for example,
Speaker 1: if you can't make anything when you collect your premiums
Speaker 1: before paying them out, if you're a bank, there's no
Speaker 1: spread between what you're paying your depositors and what you're
Speaker 1: getting for your mortgages and so forth. So of course
Speaker 1: that's where we are now. So the question is where
Speaker 1: will we be several years out. And I think that
Speaker 1: if Convince returns, if we can, if we can get
Speaker 1: past this coronavirus, I think the economy will come back.
Speaker 1: I think that demand for loans will come back. I
Speaker 1: think you'll see some more inflation. I'll push interest rates up.
Speaker 1: So I think that is just what the doctor ordered
Speaker 1: for these financials, and so then the question is which
Speaker 1: financial I like Wells Fargo just because it has you know,
Speaker 1: one of the best coast to coast franchises, has historically
Speaker 1: been a very good underwriter, very conservative, but the loans
Speaker 1: they extend and they're focused on your middle market retail.
Speaker 1: They're not in the more volatile trading area. And of
Speaker 1: course the stock was sixty five just twenty six months ago,
Speaker 1: now picking up at seven with a seven percent dividend.
Speaker 1: That looks pretty good for me if you have a
Speaker 1: you know, if you're looking more than a couple of
Speaker 1: months out. Well and I also have to think that
Speaker 1: part of the place, David has to be that if
Speaker 1: you're looking at some of the big banks that are
Speaker 1: so involved, certainly in the mortgage market. I mean, how
Speaker 1: many consumers probably have a mortgage with Wells Fargo or
Speaker 1: home equity with Wells Farg. I mean, on the other
Speaker 1: side of this, the bigger players are probably going to
Speaker 1: manage even if it gets tough, They're gonna do, you know,
Speaker 1: the best compared with some of the other players. You
Speaker 1: are so right, Carol, I mean, often tough times allows
Speaker 1: the biggest players in the market to expand market share
Speaker 1: is smaller, less well capitalized, less well known, less efficient
Speaker 1: players kind of fall off the tables were I think
Speaker 1: Wells Fargo can get them back to them bank first
Speaker 1: fucking terms to advertising, cross selling, all those good things.
Speaker 1: One thing I do want to ask you, Joe Wisenthal.
Speaker 1: He and I think it's Tracy Alloway. They put out
Speaker 1: five things to start your day every day, different editions,
Speaker 1: and one of the things that he brought out and
Speaker 1: we we've talked about this, whether we're looking at airlines,
Speaker 1: retail that if you believe in capitalism, you know, company
Speaker 1: as be allowed to put company be out of business
Speaker 1: if they're doing a better job at that. But I
Speaker 1: do wonder about what the impact is on a good
Speaker 1: macro policy. What is it what's going to go be
Speaker 1: better for us certainly going through this crisis on the
Speaker 1: other side of it, in terms of helping out the economy,
Speaker 1: And I do wonder what you think about providing assist
Speaker 1: to some of the smaller players that are out there,
Speaker 1: and how important that is in terms of the overall
Speaker 1: health of the US economy and of the overall US market. Wow,
Speaker 1: that's a great question. And I think normally, I think
Speaker 1: most investors and an economists say for capitalism to survive UM,
Speaker 1: there has to be failure as well as success. And
Speaker 1: if you prop up everyone, no one fails, you end
Speaker 1: up with these zombie entities, and then capital start reallocated
Speaker 1: from UM the weak, unsuccessful to those who have a
Speaker 1: better mousetrap. That's what you normally want. This situation that's
Speaker 1: been a little bit different because there was so no
Speaker 1: one could really plan for it, no one, no one
Speaker 1: forecast it. And so I think what the Federal Reserve
Speaker 1: is trying to do, as well as Congress, is to
Speaker 1: provide some sort of safety net so that no one fails,
Speaker 1: at least because of the coronavirus. But there's no question
Speaker 1: about it. After we get past that, then the props
Speaker 1: should be taken out and then you should uh um
Speaker 1: thrive on your merits and fail if you can't be
Speaker 1: ab used to consumers. So who else do you like
Speaker 1: here in this market, David uh in terms of things
Speaker 1: that things that you hold that you're excited about, Well,
Speaker 1: you don't never waste a good crisis. And you know,
Speaker 1: as much as I admire Warren Buffett and I agree
Speaker 1: with him, America is going to do great with a
Speaker 1: long call. I do not see in America without the airlines.
Speaker 1: You can't get to Florida, Vegas, Disney, Hawaii. It doesn't work.
Speaker 1: I think the airlines are ultimately gonna make it may
Speaker 1: take a little bit longer. So I want to go
Speaker 1: with the bluish the blue ships. South West Airlines, which
Speaker 1: has beaten the S and P five since it first
Speaker 1: came public in nineteen seventy one by about three to one,
Speaker 1: is even beating the SP five from the low point
Speaker 1: of the last crisis. Now it's down by about but
Speaker 1: very little debt. The most efficient, simple fair prices, free
Speaker 1: check back, saw the customer services, lower union exposure. I
Speaker 1: think this comes out. It's the largest of the domestic carriers.
Speaker 1: I think this comes out very solidly. In fact, Gary
Speaker 1: Kelly just the other day I think Sunday said he
Speaker 1: thought the first week of April was the worst period
Speaker 1: for company, and business is picking up. So at a
Speaker 1: fifty two week low, um uh. I think this is
Speaker 1: an interesting speculation going forward. Unless you think all the
Speaker 1: airlines are gonna be nationalized, I don't think that's going
Speaker 1: to happen. Well, there's a conversation I was listening to
Speaker 1: this morning I'm blog radio about this whole idea of
Speaker 1: like the Chinese coming in with money, but that is
Speaker 1: going to be there's going to be a lot of pushbacks,
Speaker 1: certainly with its Cifius reviews. Uh. And you know politicians
Speaker 1: waitnute seeing that. I agree, I agree, I totally agree. Um,
Speaker 1: David Eats, thank you so much. Take care of yourself.
Speaker 1: He mentioned Southwest Airlines stocks down almost so far this
Speaker 1: year and taking another hit no doubt on those Warren
Speaker 1: Buffett comments and backing out of airlines. Uh. Southwest is
Speaker 1: down about six percent in today's session. David Eats over
Speaker 1: at Point View Wealth Management, Jason, Yeah, so good to
Speaker 1: catch up with him, and good to talk some names
Speaker 1: who always love hearing what's on his mind. And I
Speaker 1: have to say he's been a wells fargobule for a
Speaker 1: long time. Love talking to him about that. Even in
Speaker 1: its darkest days when they were settling with the government,
Speaker 1: couldn't find a CEO. Uh, he stuck with it. So
Speaker 1: we'll see if he ultimately is right. Well, it's beginning
Speaker 1: to look a lot like Christmas, not really, but retailer
Speaker 1: here I know are already starting to think about it
Speaker 1: and what they're thinking about doesn't look good. I was
Speaker 1: not excited from what it says, but excited to read
Speaker 1: the story. It's so smart. Uh. And by one of
Speaker 1: our top reporters, Matt Townsend. He joins us on the
Speaker 1: phone from Brooklyn. So this isn't great retail sector clearly
Speaker 1: suffering here, Matt, but already Christmas looking grim. Yeah, that's right.
Speaker 1: I mean, you know, there's a lot of thought out
Speaker 1: there that at some point we'll have this nice recovery
Speaker 1: coming into the fourth quarter and consumers will bounce back.
Speaker 1: So we looked at it, and you know, companies like Fitch,
Speaker 1: the ratings company, I mean, they're already baking in as
Speaker 1: much as a temper center client in sales for discretionary companies. Um.
Speaker 1: And it really boils down to two things. One the
Speaker 1: consumer they expect and other firms expect the consumer to
Speaker 1: still be under pressure, whether it's high unemployment to thread
Speaker 1: of the virus. Also, shopping in a retail environment that
Speaker 1: has all this social distancing might not be that great
Speaker 1: of an experience that could damp in sales. So there's
Speaker 1: a lot of problems with the consumer that could lead
Speaker 1: to a blue What we're calling a quote blue Christmas. Yeah.
Speaker 1: I mean, I just think there are so many questions
Speaker 1: and I think you just hit it, you know, And
Speaker 1: I do wonder what it means for retailers. I mean,
Speaker 1: Macy's is opening up, right, Matt, and I just think
Speaker 1: about do I want to go in there? Where? How
Speaker 1: do you keep a place of those U of those
Speaker 1: you know, that size? How do you keep it totally clean? Safe?
Speaker 1: I just think it's difficult, it is, and you know,
Speaker 1: so far we've seen from some of this early states
Speaker 1: opening up, or even for some of the retailers that
Speaker 1: have been opened the whole time, like a Walmart, um,
Speaker 1: you know their or Target, they're having some issues with
Speaker 1: their in store sales. And the other thing is, you
Speaker 1: know people expect, oh well, if people don't want to
Speaker 1: go to stores, alto shop online. But the problem with
Speaker 1: that is online e commerce is a much lower margin
Speaker 1: uh business for most retailers because they have to do
Speaker 1: all the shipping and the return shipping, and then on
Speaker 1: top of that impulse buys. So the whole point of
Speaker 1: a story as you walk in and you buy stuff
Speaker 1: that you didn't go there for, you know, the whole
Speaker 1: thing if you go there to buy milk at the
Speaker 1: grocery store and you end up walking out with a
Speaker 1: full cart. Well, online that doesn't really happen as much.
Speaker 1: So that's that's basically the fundamental way a lot of
Speaker 1: these retailers work. So if more store sales going to
Speaker 1: online could impact margins margins in a big way. Yeah,
Speaker 1: that's really interesting. And also, I mean, not for nothing,
Speaker 1: we could be in a horrible economy by the time
Speaker 1: it gets to Christmas time and you know, people just
Speaker 1: are not going to open it be uh spending a
Speaker 1: lot of money presumably. Yeah, I mean that's you know,
Speaker 1: it's it's hard to model this like it's been set
Speaker 1: a nauseam throughout this whole thing is that there's nothing
Speaker 1: to compare this to um. And you know, another thing
Speaker 1: we wrote about in the story is that there's this
Speaker 1: other side to this as well. Whereas you know, retailers
Speaker 1: are financially distressed. Obviously we saw j Crewe file for
Speaker 1: bankruptcy the past twenty four hours and there's a big
Speaker 1: question mark about will they be be able to even
Speaker 1: get enough products on the shelves to meet demand. That
Speaker 1: the supply chains have been upended, and you know, We've
Speaker 1: reported about this a couple of times already in the
Speaker 1: past few weeks, is that vendors are very upset and
Speaker 1: feel very burned by the retail industry because they basically
Speaker 1: had months of ordered, months of orders canceled on them.
Speaker 1: They're stuck with all these goods nowhere to sell them.
Speaker 1: So there's this frostiness between the retailers and their vendors,
Speaker 1: and you know, it's it's becoming dicey to ship to
Speaker 1: a retailer at this point, knowing, not knowing what's going
Speaker 1: to happen. So Matt, let me just ask as a consumer,
Speaker 1: because I've been watching this and you know, my daughter
Speaker 1: and I like if we see something that's online and
Speaker 1: we're like, I'm gonna wait because I think these you know,
Speaker 1: the retailers are going to go down. Yeah, totally, And
Speaker 1: you do see it kind of move around a little bit,
Speaker 1: and and how retailers are keeping track of what's in
Speaker 1: your basket and they're like, hey, did you see you
Speaker 1: know now it's on sale. So I do wonder for consumer,
Speaker 1: will there be lots of deals are not necessarily because
Speaker 1: as you say, supply chains, but I do wonder about
Speaker 1: all that old inventory that's just sitting around and they've
Speaker 1: got to get rid of it. Yeah. No, I think
Speaker 1: there will be deals or there will be you know,
Speaker 1: a flood of inventory going to the discounters and the
Speaker 1: t J Maxes of the world, UM and the Marshals
Speaker 1: and things like that. But there is there is that
Speaker 1: consumer behavior where you're expecting to see bigger discounts at
Speaker 1: this point because you hear the news about all these
Speaker 1: retailers and trouble and for the most part, we haven't
Speaker 1: seen you know, wholesale liquidations of products within anything like that.
Speaker 1: So we got, yeah, talk to us about Jay Crew
Speaker 1: because you know, this is obviously an incredibly well known brand.
Speaker 1: You know, a troubled last decade in many ways for
Speaker 1: the company, specifically some comings and goings at the at
Speaker 1: the very top what ultimately took it down. You know,
Speaker 1: Jay Crew won over you know a lot of these
Speaker 1: companies they went over a generation of consumers. You know,
Speaker 1: they went over the Gen xers you know, in the
Speaker 1: nineties and everything like that, and they just were never
Speaker 1: able to win the next generation for whatever reason, whether
Speaker 1: it was competitors, Fast Fashion, um, you know, Mickey Drexler
Speaker 1: obviously the architect of the of the brand. Um, did
Speaker 1: he lose his way? Did the brand lose its way?
Speaker 1: I mean, there's a lot of things are a part
Speaker 1: of this, but a big thing is the humor really
Speaker 1: just moved on and they never were able to win
Speaker 1: that next generation, like my generation love J Crew. The
Speaker 1: generation below us who are now in their early thirties
Speaker 1: twenties did not go to Jay Crew as as as
Speaker 1: as as as big as as as much as we did. Yeah, no,
Speaker 1: it's it's really true. They're shopping differently and there and
Speaker 1: there's the whole private equity angle to which which obviously
Speaker 1: uh saddled the company uh with some debt and you know,
Speaker 1: maybe made some decisions that ultimately ultimately took it down.
Speaker 1: So too early to talk Christmas though, No, it is never,
Speaker 1: it's never. And as I said the top of the show, though,
Speaker 1: all I really want for Christmas is a plate of
Speaker 1: your Christmas cookies. That's good. You will get a plate
Speaker 1: of car all right, that's good. All right, Matt Town,
Speaker 1: give me the flower, like I said, I'll I'll get
Speaker 1: you the flower that that'll be the deal. That'll be.
Speaker 1: We'll do some bartering here in Mattowns and retail reporter
Speaker 1: for Bloomberg. A really great story. It's one of the
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Speaker 1: eas right. Yes, how they do through office because they're
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