WEBVTT - A Fed Pause and an Arctic Army 0:00:01.280 --> 0:00:05.119 You're listening to the Bloomberg Opinion podcast count US Saturdays 0:00:05.120 --> 0:00:08.280 at one and seven pm Eastern on Bloomberg dot Com, 0:00:08.320 --> 0:00:11.479 the iHeartRadio app and the Bloomberg Business App, or listen 0:00:11.520 --> 0:00:13.760 on demand wherever you get your podcasts. 0:00:15.080 --> 0:00:17.959 Welcome to Bloomberg Opinion. I'm Amy Morris. This week we 0:00:18.040 --> 0:00:21.000 look at military training in the northernmost points of the 0:00:21.000 --> 0:00:25.720 world and how geopolitics and climate change are impacting military strategy. 0:00:26.320 --> 0:00:30.160 We're also taking a second look at those new obesity drugs, 0:00:30.360 --> 0:00:34.440 which can be expensive, so should the government step in? 0:00:35.080 --> 0:00:38.199 And the travel industry is making a comeback, except for 0:00:38.320 --> 0:00:42.280 corporate travel no matter. Companies are finding ways around that. 0:00:42.880 --> 0:00:45.800 Let's get started now. With the latest FED decision described 0:00:45.840 --> 0:00:49.959 as a hawkish pause, Federal Reserve Chairman J Powell's comments 0:00:50.000 --> 0:00:53.559 after the FED meeting indicated that more rate hikes may 0:00:53.640 --> 0:00:54.320 be to come. 0:00:54.600 --> 0:00:56.840 It will be appropriate to cut rates at such time 0:00:56.920 --> 0:01:00.400 as inflation is coming down really significantly, and again we're 0:01:00.440 --> 0:01:02.760 talking about a couple of years out. I think, as 0:01:02.800 --> 0:01:05.520 anyone can see, not a single person on the committee 0:01:05.560 --> 0:01:07.920 wrote down a rate cut this year, nor do I 0:01:07.920 --> 0:01:11.400 think it is at all likely to be appropriate. If 0:01:11.400 --> 0:01:14.319 you think about it, inflation has not really moved down 0:01:14.440 --> 0:01:14.800 that Chara. 0:01:14.880 --> 0:01:17.000 Powell went on to say that they're going to have 0:01:17.040 --> 0:01:19.840 to quote keep at it. Let's talk this over with 0:01:19.880 --> 0:01:24.320 Bloomberg opinion columnist Jonathan Levin covering finance, markets and M 0:01:24.360 --> 0:01:27.000 and A. Jonathan, I would like to get your reaction 0:01:27.080 --> 0:01:28.400 to Chair Powell's comments. 0:01:28.600 --> 0:01:31.520 Yeah, well, I mean, basically, I thought he was tasked 0:01:31.520 --> 0:01:34.559 with an impossible dance and he did an okay job 0:01:34.720 --> 0:01:38.280 of it right Effectively, what I think Chair Powell is 0:01:38.319 --> 0:01:41.000 trying to do is something like what green Span did 0:01:41.280 --> 0:01:44.240 in the nineties, and of course that's the ultimate model. 0:01:44.600 --> 0:01:47.720 It's basically the only recent model of a soft landing. 0:01:48.160 --> 0:01:53.080 And what Greenspan did was he started getting concerned about 0:01:53.080 --> 0:01:56.480 inflation potentially at taking off, and he said, let's take 0:01:56.520 --> 0:02:00.520 this slowly and monitor the data. So they actually went 0:02:00.640 --> 0:02:06.520 to a skip model, which they executed on for about 0:02:06.560 --> 0:02:10.360 half a year in the mid nineteen nineties. So that 0:02:10.400 --> 0:02:14.520 seems to be what he's trying to do. But his 0:02:14.680 --> 0:02:17.799 task here again was to slow down, go to this 0:02:17.840 --> 0:02:22.640 sort of potentially every other meeting model without letting financial 0:02:23.160 --> 0:02:27.320 conditions get too loose. So you know, he went straight 0:02:27.360 --> 0:02:32.280 to the classic jaw Booning textbook, you know, and you 0:02:32.320 --> 0:02:35.000 see some of that in the summary of economic projections, 0:02:35.400 --> 0:02:40.240 and you saw a reasonable helping of it as well 0:02:40.400 --> 0:02:44.080 at the press conference. But he sort of failed in 0:02:44.120 --> 0:02:48.200 his I think objective to be hawkish when he ultimately 0:02:48.680 --> 0:02:53.240 decided that he couldn't indicate anything about what was going 0:02:53.280 --> 0:02:56.680 to happen about in the next meeting in July, and 0:02:56.760 --> 0:03:00.320 in sort of failing to commit to doing something were 0:03:00.560 --> 0:03:04.080 in July and saying that July is effectively a live meeting. 0:03:04.520 --> 0:03:07.440 You know, people said, well, you know this could still 0:03:07.840 --> 0:03:09.320 this could still really be the end. 0:03:09.800 --> 0:03:12.239 Okay, So you kind of answered it, But I want 0:03:12.240 --> 0:03:15.560 to get a little bit deeper into it about why pausing. Now. 0:03:16.120 --> 0:03:18.640 I understand about the signals that he's trying to send, 0:03:18.639 --> 0:03:20.880 but if there's an expectation that more hikes are coming, 0:03:20.919 --> 0:03:23.040 why do this at all? 0:03:23.200 --> 0:03:26.520 Yeah, And so again, I think it's basically two things. 0:03:27.280 --> 0:03:32.560 I think Number one, monthly data is extremely volatile. Central 0:03:32.600 --> 0:03:35.920 bankers don't like to make policy decisions off of a 0:03:35.920 --> 0:03:40.040 single month's data. So you extend out your timeframe, and 0:03:40.400 --> 0:03:43.920 you know, going forward, you now have potentially a couple 0:03:44.000 --> 0:03:47.160 of months of data to a sort of rolling average 0:03:47.160 --> 0:03:49.839 that you can make your policy decisions off of number two. 0:03:50.200 --> 0:03:54.120 It's about it's about speed, it's about velocity. Right, So 0:03:54.240 --> 0:03:57.640 we went from seventy five hikes to fifty hikes to 0:03:57.720 --> 0:04:00.960 twenty five hikes. And now if they end up going 0:04:01.040 --> 0:04:03.920 every other meeting for a while, you're effectively putting in 0:04:04.360 --> 0:04:08.360 a pace of twelve point five, right, So it allows 0:04:08.400 --> 0:04:12.320 you to sort of ease into your destination at a 0:04:12.360 --> 0:04:16.039 little bit slower of a pace and in their minds, 0:04:16.600 --> 0:04:17.840 prevent from overdoing it. 0:04:18.200 --> 0:04:21.160 Are these plans set in stone? Is there anything that 0:04:21.200 --> 0:04:24.200 could derail them? I'm thinking of the collapse of the 0:04:24.240 --> 0:04:27.160 regional banks or some other X factor that we should 0:04:27.200 --> 0:04:28.880 be watching for between now and then. 0:04:30.360 --> 0:04:32.320 Yeah, I mean, it could be any number of things. 0:04:32.880 --> 0:04:35.719 I wrote a column not too long ago about how 0:04:35.760 --> 0:04:39.839 the list of the sort of tail events that we 0:04:39.920 --> 0:04:43.159 all have at the top of our mind is getting shorter. 0:04:43.240 --> 0:04:45.719 But there, you know, in circumstances like this, there are 0:04:45.760 --> 0:04:48.120 always going to be things that nobody has thought of. 0:04:48.760 --> 0:04:53.359 The simple fact is it's sort of orthodoxy in the 0:04:53.400 --> 0:04:57.040 economics profession to believe in this notion of the long 0:04:57.080 --> 0:05:01.560 and variable legs. But in practice, that's always changing with 0:05:01.720 --> 0:05:06.320 the sort of broader characteristics of the US economy, and 0:05:06.480 --> 0:05:09.480 nobody can say with any precision whether or not those 0:05:09.560 --> 0:05:13.360 lags are six months now, are they twelve months? Are 0:05:13.400 --> 0:05:17.040 there eighteen months? If you take just sort of the 0:05:17.160 --> 0:05:22.440 main core CPI or in the Fed's case, core PCEE, 0:05:22.760 --> 0:05:26.719 which is their preference, the trend is really just moving sideways, 0:05:26.920 --> 0:05:31.799 and they're really, you know, before they make a meaningful 0:05:31.920 --> 0:05:36.680 change in their policy, certainly in the Duvish direction, they're 0:05:36.720 --> 0:05:39.800 going to want to see you know, two, three, four 0:05:39.960 --> 0:05:44.120 reports that show that inflation is meaningfully coming down, not 0:05:44.720 --> 0:05:49.200 just sort of flattening out at this moderately bad level. 0:05:49.960 --> 0:05:53.320 And we are talking with Bloomberg opinion columnist Jonathan Levin 0:05:53.600 --> 0:05:56.560 about the federal reserves hawkish pause for lack of a 0:05:56.560 --> 0:05:57.080 better term. 0:05:57.080 --> 0:05:59.479 Do you like that term, Jonathan, That's what the Fed 0:05:59.520 --> 0:06:03.440 speaker is would would like us to think it was. 0:06:04.760 --> 0:06:07.760 You know, again, there there was sort of this reluctance 0:06:07.800 --> 0:06:13.320 on Powell's part to define what's really going on here. 0:06:12.960 --> 0:06:15.680 There was this quintessential moment in the in the press 0:06:15.680 --> 0:06:19.960 conference where Powell referred to the thing as a skip. 0:06:20.320 --> 0:06:23.040 But then he doubled back because he didn't really want 0:06:23.080 --> 0:06:25.680 to show his cards. And part of the reason that 0:06:25.760 --> 0:06:29.600 he doesn't want to show his cards is because, you know, 0:06:30.200 --> 0:06:32.440 just like the rest of us, FED policy makers, really 0:06:32.480 --> 0:06:36.880 can't see the future. I talked a moment ago about 0:06:37.040 --> 0:06:42.359 how core PC and core CPI as they're traditionally conceived, 0:06:42.440 --> 0:06:46.080 are moving sideways. But there are some interesting things potentially 0:06:46.120 --> 0:06:50.720 going on under the surface that could be excellent sort 0:06:50.760 --> 0:06:54.359 of drags on the inflation picture, including what's going on 0:06:54.760 --> 0:06:58.520 in used used cars. Right, So a lot of the 0:06:58.600 --> 0:07:02.760 data nerds like to like to look at these wholesale 0:07:02.839 --> 0:07:07.320 indices of what's going on with used car prices there, 0:07:07.720 --> 0:07:12.160 and based on those, you know, we should really expect 0:07:12.440 --> 0:07:15.480 used cars, which are a big chunk of that CORE index, 0:07:15.800 --> 0:07:19.000 to start going the other way in these in these 0:07:19.040 --> 0:07:22.400 summer months. And so when you think about it, you know, 0:07:22.440 --> 0:07:26.960 by the time we get to that July decision, and 0:07:27.080 --> 0:07:31.040 certainly by the time we get into the fall, you 0:07:31.160 --> 0:07:34.080 could potentially be dealing with a different story. So this 0:07:34.200 --> 0:07:37.920 is a this is a FED that again is trying 0:07:37.960 --> 0:07:41.040 to convey a certain level of hawkishness so that financial 0:07:41.040 --> 0:07:44.480 conditions don't run away. But I think under the surface, 0:07:44.480 --> 0:07:47.760 they're also kind of hopeful that we could be dealing 0:07:47.840 --> 0:07:50.920 with a different set of numbers in one, two, three 0:07:50.920 --> 0:07:51.520 months time. 0:07:52.280 --> 0:07:54.360 What does this mean then for market volatility? 0:07:55.880 --> 0:07:58.960 Well, I think it means again that we're sort of 0:07:58.960 --> 0:08:04.120 beholding to the numbers. I think, you know, when when 0:08:04.400 --> 0:08:08.240 Powell says that the next meeting is a live meeting, 0:08:08.880 --> 0:08:11.960 he actually kind of kind of means it that. You know, 0:08:12.360 --> 0:08:16.440 data dependency at some points in the fed's history has 0:08:16.480 --> 0:08:19.200 been just sort of like a phrase in the FED 0:08:19.280 --> 0:08:21.520 lexicon that they just sort of say, but I really 0:08:21.560 --> 0:08:24.240 truly believe it right now, and I think the market 0:08:24.280 --> 0:08:27.480 ought to believe it too. So that creates this this 0:08:27.680 --> 0:08:32.000 environment where you know, we could potentially be getting whiplashed 0:08:32.040 --> 0:08:38.240 again by every CPI report. You know, retail sales this 0:08:38.360 --> 0:08:43.480 week coming in a little bit warmer than than people 0:08:43.600 --> 0:08:46.880 might have expected. That could be seen as a little 0:08:46.880 --> 0:08:51.000 bit hawkish for the direction of this this FED. Generally speaking, 0:08:51.360 --> 0:08:54.280 it is probably an error to read too much into 0:08:54.360 --> 0:08:57.760 any one month's a data. But I think that the 0:08:57.800 --> 0:09:01.200 way this market works nowadays, with the and so forth, 0:09:01.880 --> 0:09:03.720 that's the market that we're going to get. 0:09:03.880 --> 0:09:05.720 What are you expecting to see in the next meeting. 0:09:05.720 --> 0:09:06.920 What are you going to be looking for? 0:09:07.160 --> 0:09:10.440 First of all, the big question is what does the 0:09:10.480 --> 0:09:13.920 CPI look like that comes out before the next meeting. 0:09:14.600 --> 0:09:18.720 If we get that reversal of used cars, that's going 0:09:18.760 --> 0:09:21.040 to make that's going to make a big difference, right 0:09:21.040 --> 0:09:25.040 because used car prices seasonally adjusted, we're a month on 0:09:25.200 --> 0:09:28.800 month more than four percent this time around. If that 0:09:29.000 --> 0:09:32.920 flips around and then becomes a sizable drag, it changes 0:09:32.960 --> 0:09:36.080 the whole discussion, at least in the near term about 0:09:36.120 --> 0:09:39.960 core CPI. You're also going to have some favorable base 0:09:40.000 --> 0:09:46.360 effects coming into play, which potentially makes the year on 0:09:46.600 --> 0:09:50.920 year headline figure look somewhere in the range of three percent. 0:09:51.559 --> 0:09:55.120 That isn't the main thing that like economists and analysts 0:09:55.200 --> 0:09:57.800 are are looking at, but it does have a big 0:09:57.840 --> 0:10:03.520 impact for the sort of inflation expectations, and so that 0:10:03.679 --> 0:10:06.679 helps the FED in a way. So, you know, if 0:10:07.120 --> 0:10:11.760 the FED gets those two things to go to go 0:10:11.840 --> 0:10:14.920 in their favor, maybe there is still a possibility that 0:10:14.960 --> 0:10:19.160 they stay on hold here. Maybe it's really just another 0:10:19.320 --> 0:10:22.760 skip and they see what happens thereafter. If they do 0:10:22.880 --> 0:10:25.800 end up going back to a twenty five will Chair 0:10:25.880 --> 0:10:30.640 pal you know, signal that that then is the last one, 0:10:30.800 --> 0:10:33.960 or will he signal that no, this is the new pattern. Right, 0:10:34.040 --> 0:10:37.320 We're gonna We're gonna do twenty fives every other meeting 0:10:37.360 --> 0:10:42.480 to effectively put in place a piece of tightening of 0:10:42.600 --> 0:10:46.960 like twelve point five basis points per meeting. Those are 0:10:46.960 --> 0:10:47.839 the big questions to me. 0:10:48.120 --> 0:10:50.280 All right, we're gonna watch it with you. Jonathan. Thank 0:10:50.320 --> 0:10:53.600 you as always, We really appreciate your time. Bloomberg Opinion 0:10:53.640 --> 0:10:56.960 columnist Jonathan Levin covers finance, markets and m and A. 0:10:57.360 --> 0:10:59.520 Coming up, we're gonna look at how to hide an 0:10:59.640 --> 0:11:03.240 army on top of the world. Why you're listening to 0:11:03.280 --> 0:11:04.160 Bloomberg Opinion. 0:11:12.800 --> 0:11:16.800 You're listening to the Bloomberg Opinion podcast Contest Saturdays at 0:11:16.800 --> 0:11:19.920 one in seven pm Eastern on Bloomberg dot Com, the 0:11:20.000 --> 0:11:23.120 iHeartRadio app, and the Bloomberg Business App, or listen on 0:11:23.200 --> 0:11:25.280 demand wherever you get your podcasts. 0:11:27.360 --> 0:11:30.160 You're listening to Bloomberg Opinion. I'm Amy Morrison. We're going 0:11:30.240 --> 0:11:32.680 to take you now to a snowy mountain side in 0:11:32.880 --> 0:11:37.120 Alaska where military personnel are training with the Army's Northern 0:11:37.200 --> 0:11:40.960 Warfare Training Center, learning about the art of tomorrow's potential 0:11:41.000 --> 0:11:43.880 war at the top of the world. Joining us now 0:11:43.920 --> 0:11:47.320 is Bloomberg opinion columnist Liam Denning, who also covers energy 0:11:47.360 --> 0:11:50.760 and commodities. Liam, let's just start from the beginning. Take 0:11:50.840 --> 0:11:52.560 us there. What was your experience. 0:11:54.559 --> 0:11:59.440 It's quite unlike any place I've ever been, so, you know, 0:11:59.600 --> 0:12:02.240 it's journey just to get there. From the East coast, 0:12:03.200 --> 0:12:06.520 we landed at Fairbanks. The Army picked us up and 0:12:06.640 --> 0:12:12.040 drove us south to Black Rapids, which is basically, you know, 0:12:12.120 --> 0:12:15.760 out in the wilderness in the Alaskan interior, and when 0:12:15.760 --> 0:12:19.200 you first pull up, it's the only way I can 0:12:19.240 --> 0:12:21.600 really describe it. This was early March, by the way, 0:12:21.640 --> 0:12:26.000 so it's very still very cold. The Delta River running 0:12:26.040 --> 0:12:30.720 alongside the highway was completely frozen. So yeah, when you 0:12:30.760 --> 0:12:32.760 get there, it kind of looks like a very basic 0:12:32.960 --> 0:12:35.560 ski resort. There's an army base at the base of 0:12:35.559 --> 0:12:39.320 a hill, and then you trudge up the slopes and 0:12:39.320 --> 0:12:44.720 you've got you know, bunny slopes, drag lifts, camp sites, 0:12:44.840 --> 0:12:48.200 backcountry trails, that sort of thing. And we spent five 0:12:48.280 --> 0:12:51.280 days with them on what they call a cold weather 0:12:51.480 --> 0:12:57.360 leader's course, where they learned to survive and fight in 0:12:57.440 --> 0:13:00.200 these very harsh cold conditions. 0:13:00.160 --> 0:13:03.440 Bring us up to speed about the anxiety connected with 0:13:03.640 --> 0:13:06.400 Alaska and why all of a sudden, the government the 0:13:06.400 --> 0:13:10.840 military is spending so much time and so much focus there, right. 0:13:10.960 --> 0:13:14.000 Yeah, this is kind of a long running theme with Alaska. 0:13:14.920 --> 0:13:17.880 You know, if you go back to when Alaska became 0:13:17.920 --> 0:13:21.560 a state in nineteen fifty nine, A big reason why 0:13:21.600 --> 0:13:25.200 it became a state was the experience of the Second 0:13:25.200 --> 0:13:30.480 World War where Alaska was actually invaded Japanese forces occupied 0:13:30.480 --> 0:13:34.600 a couple of the Aleutian Islands and had to be ejected. 0:13:34.920 --> 0:13:38.040 And then immediately after that the onset of the Cold 0:13:38.080 --> 0:13:43.520 War where suddenly planners in Washington woke up to the 0:13:43.559 --> 0:13:47.240 fact that you could have missiles and bombers flying over 0:13:47.280 --> 0:13:50.240 the North Pole down to the lower forty eight. So 0:13:50.320 --> 0:13:55.040 Alaska became a frontline state. We built the distant Early 0:13:55.080 --> 0:14:02.240 Warning radar line, various strategic bases, and so Alaska really 0:14:02.520 --> 0:14:07.840 has come into focus when the US, I would say broadly, 0:14:07.960 --> 0:14:10.880 is feeling kind of panicked about something. You could say 0:14:10.880 --> 0:14:14.559 something similar about Alaska's oil boom in the nineteen seventies, 0:14:14.600 --> 0:14:17.520 which which really got going after the experience of the 0:14:17.840 --> 0:14:22.520 first oil shock in nineteen seventy three. Today there is 0:14:22.640 --> 0:14:28.520 concern that as climate change changes, the topography of the 0:14:28.640 --> 0:14:33.000 Arctic potentially opens more access to its resources, to its 0:14:33.000 --> 0:14:36.840 shipping lanes. The US is waking up to the fact 0:14:36.880 --> 0:14:42.360 that Russia is reasserting its identity in the Arctic and 0:14:42.400 --> 0:14:46.040 its military and commercial presence. China, although it's not an 0:14:46.120 --> 0:14:51.360 Arctic country, is also asserting its presence there and is 0:14:51.440 --> 0:14:55.800 taking a claim certainly to maritime roots. And so I 0:14:55.840 --> 0:14:59.280 think the US, really, after a couple of decades where 0:14:59.280 --> 0:15:02.840 it had its tension focused elsewhere the Middle East Afghanistan, 0:15:03.520 --> 0:15:09.000 is now refocusing on the need to both have a 0:15:09.200 --> 0:15:14.200 credible deterrent in Alaska, but also be prepared for what 0:15:14.400 --> 0:15:17.000 may or may not happen in the future as we 0:15:17.080 --> 0:15:21.960 start to get more powers kind of vying for a 0:15:22.000 --> 0:15:23.560 position in that region of the world. 0:15:24.080 --> 0:15:26.240 I always thought, and I think you even said this 0:15:26.320 --> 0:15:28.520 in your column, that the Arctic was sort of hands 0:15:28.520 --> 0:15:29.640 off a neutral zone. 0:15:30.080 --> 0:15:34.640 No, yeah, it was. It was sort of that way 0:15:34.720 --> 0:15:38.840 for about thirty years or so. That a famous speech 0:15:38.880 --> 0:15:41.960 that Mikhail Gorbachev gave at the end of the eighties 0:15:42.000 --> 0:15:44.520 where he called it, I think a zone of peace 0:15:45.200 --> 0:15:48.120 and there was this general understanding that because it was 0:15:48.200 --> 0:15:54.320 environmentally sensitive, bodies like the Arctic Council, which was formed 0:15:54.320 --> 0:15:59.800 in the late nineties worked cooperatively around it. But that 0:15:59.920 --> 0:16:03.040 is changing for various reasons. I think, you know, the 0:16:03.080 --> 0:16:06.600 parallel I draw is with climate change itself. You know, 0:16:06.720 --> 0:16:11.000 the carbon emissions that lead to climate change, they don't 0:16:11.040 --> 0:16:14.600 originate in the Arctic, but they certainly find their way 0:16:14.640 --> 0:16:17.520 there and their effects find their way there. And I 0:16:17.560 --> 0:16:20.560 think something similar is happening with geopolitics. 0:16:20.680 --> 0:16:22.960 You've talked about China and Russia, and it makes me 0:16:23.040 --> 0:16:27.440 wonder what Russia's intentions might be if that's a genuine 0:16:27.480 --> 0:16:29.320 concern that seems unbelievable. 0:16:29.760 --> 0:16:33.680 It's tricky, right, because you do have to recognize the 0:16:33.680 --> 0:16:38.480 fact that Russia is, by definition, the biggest power in 0:16:38.520 --> 0:16:41.400 the Arctic. It has the most land, the most people, 0:16:41.520 --> 0:16:46.160 the biggest economic activity, the most energy production. So on 0:16:46.400 --> 0:16:53.320 one level, Russia's you know, Russia's efforts to stake out 0:16:53.560 --> 0:16:58.920 in the Arctic are perfectly legitimate. On the other, it 0:16:59.000 --> 0:17:02.840 has taken certain provocative measures. You know, one of the 0:17:02.880 --> 0:17:07.760 more famous ones was where a Russian submersible planted a 0:17:07.800 --> 0:17:11.880 flag on the seabed below the north at the North Pole, 0:17:12.840 --> 0:17:15.240 which was which was seen as really a kind of 0:17:15.280 --> 0:17:19.399 a provocation to the other Arctic powers, and there is 0:17:19.440 --> 0:17:22.359 an ongoing dispute about who owns which bits of the 0:17:22.480 --> 0:17:26.000 Arctic seabed, although that is to be fair, you know, 0:17:26.119 --> 0:17:29.920 being being handled by by a UN court, So it's 0:17:29.920 --> 0:17:36.280 not necessarily a huge flash point. However, I think we 0:17:36.640 --> 0:17:39.760 have to come back to events like the Ukraine War, 0:17:41.520 --> 0:17:46.040 and we have to recognize that Arctic development is a 0:17:45.920 --> 0:17:50.080 is a central part of Vladimir Putin's strategy for Russian 0:17:50.640 --> 0:17:54.840 economic development and great power projection. It's almost a personal 0:17:54.920 --> 0:17:58.240 obsession for him. And I think if you're a power 0:17:58.480 --> 0:18:02.520 like the US, you can't really separate those things because 0:18:02.720 --> 0:18:07.280 you know, at a very straightforward level, if Russia realizes 0:18:07.520 --> 0:18:11.520 it's upic ambitions, if it becomes a giant exporter of 0:18:11.640 --> 0:18:16.359 energy there, if it becomes a more dominant holder of 0:18:17.200 --> 0:18:21.560 territory there, it will use that to realize its ambitions elsewhere, 0:18:21.600 --> 0:18:27.120 and that includes it's overtly anti Western policy, its intention 0:18:27.280 --> 0:18:30.520 to crush Ukraine. So I just think, you know, on 0:18:30.960 --> 0:18:33.400 reasonable grounds, it just can't be separated. 0:18:34.040 --> 0:18:36.200 Is it a reasonable thing to think that they would 0:18:36.280 --> 0:18:39.800 actually try to cross that rubicon. And I don't want 0:18:39.840 --> 0:18:44.120 to say attack Alaska, but encroach upon Alaska in such 0:18:44.119 --> 0:18:46.919 a way that it would become a flashpoint. That again, 0:18:47.000 --> 0:18:50.800 that just seems so far fetched, but I guess it isn't. 0:18:52.320 --> 0:18:54.760 I think it's one of those things where, you know, 0:18:54.800 --> 0:18:56.520 and this really came home to me when I was 0:18:56.560 --> 0:19:00.199 talking to people at the at the Northern Wall for 0:19:00.560 --> 0:19:05.240 Training Center. It does seem, it does seem ludicrous to 0:19:05.320 --> 0:19:07.520 think that, you know, similar to what happened in the 0:19:07.560 --> 0:19:09.600 Aleutian Islands in the Second World War, that someone would 0:19:09.600 --> 0:19:13.840 actually try to invade, you know, a place like Alaska, 0:19:13.920 --> 0:19:16.560 and that does seem highly unlikely. However, we live in 0:19:16.560 --> 0:19:24.879 an era of hybrid warfare of unmanned drones balloons. To 0:19:25.000 --> 0:19:30.760 raise a more topical issue, and I think the sense 0:19:30.760 --> 0:19:34.200 I get from what the eleventh Airborne Division is doing, 0:19:34.240 --> 0:19:38.240 and that's the dedicated division in Alaska. I think they 0:19:38.320 --> 0:19:41.639 take it as being a situation where they don't really 0:19:41.840 --> 0:19:46.440 know exactly what the mission might be, what they might 0:19:46.480 --> 0:19:49.560 have to prepare for, whether you know, whether it's sabotage, 0:19:49.560 --> 0:19:53.520 whether it's dealing with you know, small special operations, forces 0:19:53.560 --> 0:19:56.720 that sort of thing. But what they do have to 0:19:56.760 --> 0:20:00.720 focus on is making sure that if something happens, they 0:20:00.760 --> 0:20:03.600 all prepared to deal with it. 0:20:03.960 --> 0:20:07.360 Lian, this is fascinating. I cannot recommend this column enough 0:20:07.359 --> 0:20:10.400 to anyone with the Bloomberg terminal. Liam Denning, a Bloomberg 0:20:10.400 --> 0:20:13.520 Opinion columnist who covers energy and commodities. Thank you for 0:20:13.600 --> 0:20:15.640 taking the time with us today. Do appreciate it. 0:20:16.160 --> 0:20:16.520 Thank you. 0:20:17.040 --> 0:20:20.320 Coming up, we'll take a closer look at obesity, drugs 0:20:20.320 --> 0:20:23.000 and concerns about access that they won't work if you 0:20:23.040 --> 0:20:25.760 can't afford them, and don't forget. We're available as a 0:20:25.760 --> 0:20:30.200 podcast on Apple, Spotify, or your favorite podcast platform. This 0:20:30.560 --> 0:20:31.680 is Bloomberg Opinion. 0:20:39.760 --> 0:20:43.760 You're listening to the Bloomberg Opinion podcast conchst Saturdays at 0:20:43.760 --> 0:20:46.879 one and seven pm Eastern on Bloomberg dot Com, the 0:20:46.960 --> 0:20:50.080 iHeartRadio app, and the Bloomberg Business App, or listen on 0:20:50.160 --> 0:20:52.240 demand wherever you get your podcasts. 0:20:54.320 --> 0:20:57.800 This is Bloomberg Opinion. I Mamy Morris. More than forty 0:20:57.880 --> 0:21:01.480 percent of American adults are OBEs, and the cost to 0:21:01.520 --> 0:21:04.399 the healthcare system is one hundred and seventy three billion 0:21:04.440 --> 0:21:07.359 dollars a year. The cost to our health far greater. 0:21:07.640 --> 0:21:09.679 So why is it so hard to get access to 0:21:09.720 --> 0:21:13.760 these new effective medications for weight loss? Bloomberg Opiion editor 0:21:13.840 --> 0:21:18.639 Rachel Rosenthal covers healthcare and joins as now heart disease, stroke, 0:21:19.040 --> 0:21:24.280 type two diabetes, some cancers, all related to obesity. They're 0:21:24.320 --> 0:21:27.119 among some of the leading causes of preventable deaths in 0:21:27.160 --> 0:21:31.600 the US. One might think that doctors would be prescribing 0:21:31.640 --> 0:21:34.320 these drugs handover fist, and then insurance companies would be 0:21:34.359 --> 0:21:37.520 scrambling to cover the cost. And that's not happening. What 0:21:37.720 --> 0:21:38.359 is the hang up? 0:21:39.200 --> 0:21:42.560 Yeah, it's so much more complicated when finally we have 0:21:42.600 --> 0:21:45.960 a solution to this huge problem. You know, there's a 0:21:46.000 --> 0:21:48.639 couple of issues here. One and I think the major 0:21:48.680 --> 0:21:54.600 one is cost. These these drugs are quite pricey, upwards 0:21:54.600 --> 0:21:57.119 of you know, nine hundred two one thousand dollars a month. 0:21:57.800 --> 0:22:02.520 So I think insurers and employers are understandably a little 0:22:02.560 --> 0:22:04.800 bit worried about covering this because if they, you know, 0:22:04.840 --> 0:22:08.159 as you mentioned, with forty percent of the population you know, 0:22:08.280 --> 0:22:12.040 qualifying for these drugs, I mean, this could raise costs 0:22:12.119 --> 0:22:16.720 astronomically for employers, which are providers of what most people 0:22:16.880 --> 0:22:19.879 have health insurance through through their jobs, right, and so 0:22:20.920 --> 0:22:24.040 that's I think the big question for the commercial market. 0:22:24.880 --> 0:22:27.600 I think the other side of the market is medicare, 0:22:28.359 --> 0:22:31.200 and here it gets complicated too because not only do 0:22:31.240 --> 0:22:34.200 you have cost, but you have safety questions because it's 0:22:34.280 --> 0:22:37.760 just not quite known yet whether these drugs are safe 0:22:38.040 --> 0:22:40.440 long term for an older population. 0:22:41.280 --> 0:22:43.840 Is there a concern about how long you can take 0:22:43.880 --> 0:22:46.760 these drugs and what happens when you stop taking these drugs? 0:22:46.760 --> 0:22:49.000 Will there be a rebound effect? Do we have that 0:22:49.119 --> 0:22:50.000 data yet? 0:22:50.160 --> 0:22:52.159 I think this is really what a lot of doctors 0:22:52.160 --> 0:22:55.560 are focusing on right now. It is a lifelong medication. 0:22:55.920 --> 0:22:58.800 And that doesn't mean that you know, there are folks 0:22:58.960 --> 0:23:01.920 do take medication, you know, for long periods of time, 0:23:01.960 --> 0:23:04.679 so that shouldn't you know, people take statins. You know. 0:23:04.720 --> 0:23:08.439 There's all kinds of other parallels that we can think of, 0:23:09.480 --> 0:23:12.840 but it's just not tested and we do need a 0:23:12.880 --> 0:23:15.520 lot more research. I think also a lot more research 0:23:15.600 --> 0:23:18.000 needs to go into what happens if you go on 0:23:18.080 --> 0:23:21.520 and off, because you know, some folks are just taking 0:23:21.560 --> 0:23:24.159 it for a wedding, you know, and this is you know, 0:23:24.400 --> 0:23:29.800 people who may not really qualify as medically obese are 0:23:30.440 --> 0:23:33.440 trying to get access to these drugs. Just one other 0:23:33.480 --> 0:23:35.240 point on the safety issue too, is a lot of 0:23:35.280 --> 0:23:38.520 the studies have been focusing on a younger age group, 0:23:38.560 --> 0:23:41.040 whereas medicare you know, you're looking at a sixty five 0:23:41.080 --> 0:23:44.959 and up population. What these drugs do is suppress the appetite, 0:23:44.960 --> 0:23:47.040 so you are sort of eating less and taking in 0:23:47.080 --> 0:23:50.000 more calories. So there's there are questions about what that 0:23:50.040 --> 0:23:53.639 can do to you know, whether you lose muscle mass 0:23:53.720 --> 0:23:56.600 or bone bone density, and you know, if that increases 0:23:56.720 --> 0:24:00.240 what happens when you fall. So I think there are 0:24:00.480 --> 0:24:05.040 serious questions I would you know, I think some of 0:24:05.080 --> 0:24:07.800 these drugs, like some aglutide, which is you know, wigovy 0:24:07.920 --> 0:24:12.120 and nozebic are the same ingredient, have been used for diabetes. 0:24:12.359 --> 0:24:14.919 So we do have some sense that, you know, folks 0:24:14.960 --> 0:24:18.120 can take these medications, but it's still a lot more 0:24:18.119 --> 0:24:18.920 research needs. 0:24:18.720 --> 0:24:19.120 To be done. 0:24:19.359 --> 0:24:21.760 You talked about some people who maybe go on and off. 0:24:21.760 --> 0:24:23.600 Maybe they just take it for a while so they 0:24:23.600 --> 0:24:27.480 can slim down for their wedding or to because they're 0:24:27.480 --> 0:24:29.720 going on vacation or something. Okay, I get that, but 0:24:29.760 --> 0:24:32.919