WEBVTT - Inflation is Here to Stay 0:00:00.800 --> 0:00:04.040 Welcome to the Bloomberg Markets Podcast. I'm Paul Sweeney, alongside 0:00:04.040 --> 0:00:06.920 my co host Matt Miller. Every business day we bring 0:00:06.960 --> 0:00:11.520 you interviews from CEOs, market pros, and Bloomberg experts, along 0:00:11.560 --> 0:00:15.520 with essential market moving news. Find the Bloomberg Markets Podcast 0:00:15.600 --> 0:00:18.479 on Apple Podcasts or wherever you listen to podcasts, and 0:00:18.480 --> 0:00:21.279 at Bloomberg dot com slash podcast. Well, one of the 0:00:21.400 --> 0:00:25.360 key issues scrolling around markets these days is inflation. We're 0:00:25.360 --> 0:00:29.560 certainly seeing plenty signs of inflation. The question is is 0:00:29.600 --> 0:00:33.080 it more transitory as a photo reserve believes, or is 0:00:33.120 --> 0:00:36.320 it something more permanent that may pose a challenge to 0:00:36.360 --> 0:00:38.800 the markets. Let's bring in a doll Zaman partner at 0:00:38.800 --> 0:00:41.440 Wall Street Alliance Group to get some thoughts he about. 0:00:41.440 --> 0:00:44.400 Thanks so much for joining us here. Again, that inflation 0:00:44.479 --> 0:00:48.600 discussion has really been heating up over the last several weeks, 0:00:48.640 --> 0:00:51.680 and it certainly has profound implications for the markets going forward. 0:00:51.880 --> 0:00:54.200 How do you guys at Wall Street Alliance view kind 0:00:54.200 --> 0:00:58.080 of what appears to be some growing inflation in this economy. 0:00:58.760 --> 0:01:01.200 Great to be with here for so, you know, we 0:01:01.320 --> 0:01:04.880 really feel that inflation over here is a dominant team. 0:01:04.959 --> 0:01:08.880 It's not transitory. It's here to stay. And you know, 0:01:09.160 --> 0:01:12.760 the jobs report this Friday will probably give affirmation of 0:01:12.840 --> 0:01:16.319 that as well. And you know, there are different reasons 0:01:16.360 --> 0:01:19.759 for inflation, one of which obviously is the labor shortage 0:01:20.480 --> 0:01:22.600 and being in New York City. I don't know if 0:01:22.640 --> 0:01:25.039 you guys have noticed this or not, but one of 0:01:25.040 --> 0:01:27.559 the things we are suffering from is that the uber 0:01:27.680 --> 0:01:34.760 and left prices have skyrockets. Yeah, and you know, year 0:01:34.880 --> 0:01:38.080 over year they've actually, according to research, have gone up 0:01:38.080 --> 0:01:42.280 by about and the reason for that is there's a 0:01:42.280 --> 0:01:46.360 shortage of drivers. So for this reasons and others, you know, 0:01:46.440 --> 0:01:50.520 we really feel that inflation is a dominant investment team 0:01:50.600 --> 0:01:53.520 for us at Wall Street Alliance Group, and we are 0:01:53.600 --> 0:01:58.680 investing in sectors and businesses that tend to do well 0:01:58.760 --> 0:02:03.400 in an inflationary And I'm i gotta say, um, that 0:02:03.440 --> 0:02:07.080 doesn't make me unhappy because those those guys, they work 0:02:07.400 --> 0:02:11.320 so hard and that is a tireless job. Sometimes they're 0:02:11.320 --> 0:02:14.200 putting in, you know, more than twelve hour shifts. And 0:02:14.360 --> 0:02:16.040 I did a little stint as a lift driver in 0:02:16.040 --> 0:02:19.360 an Aston Martin Vantage V eight once and how did 0:02:19.400 --> 0:02:21.840 that go? It was? Actually, that was pretty fun because 0:02:21.840 --> 0:02:24.360 I wasn't in Aston Martin, but most Uber drivers are not. 0:02:25.040 --> 0:02:28.959 You know. The the the interesting thing on the labor 0:02:29.000 --> 0:02:32.000 side is there are a lot of slots that aren't 0:02:32.000 --> 0:02:35.160 getting filled, not just Uber and Lift, but also hotels 0:02:35.400 --> 0:02:38.320 that we talked to, restaurants that we talked to because 0:02:38.400 --> 0:02:41.880 the unemployment benefits are so good and I'm wondering if 0:02:41.880 --> 0:02:45.800 that's also um the problem for Uber and Lift. Do 0:02:45.840 --> 0:02:49.040 you think we're gonna see this change big time in September? 0:02:50.600 --> 0:02:53.880 So definitely that is uh, we feel that that is 0:02:53.960 --> 0:02:57.640 definitely a factor. I'm come September, you know, we are 0:02:57.639 --> 0:02:59.960 going to be a change in this and you know why. 0:03:00.000 --> 0:03:01.840 Of the things that's going to happen, Paul, is that 0:03:01.919 --> 0:03:04.960 when these all these workers come back through the workforce 0:03:05.040 --> 0:03:08.440 after the bonus and unemployment is finished, we're going to 0:03:08.480 --> 0:03:10.720 get an increase in demand and that's going to cause 0:03:10.760 --> 0:03:13.760 prices to go up. So there's again going to pay inflation. 0:03:14.480 --> 0:03:17.720 So either way, you know, we cannot get away from inflation. 0:03:17.800 --> 0:03:22.040 It's here to stay. And the prudent approaches to identify 0:03:22.200 --> 0:03:25.880 sectors that will benefit from inflation. So for example, we 0:03:25.919 --> 0:03:30.560 are very constructive on the bank banking sectors because when 0:03:30.639 --> 0:03:33.840 interest rates go up, guess what's going to happen. Banks 0:03:33.840 --> 0:03:35.680 are going to be able to make more money on 0:03:35.720 --> 0:03:39.480 their loans. Right. Banks then to also do well at 0:03:39.520 --> 0:03:44.040 times of economic recovery because businesses have to restart their 0:03:44.080 --> 0:03:46.720 shelves so they have to borrow money, right, And then 0:03:46.760 --> 0:03:49.920 the capital positions of these banks improved, so they were 0:03:49.960 --> 0:03:52.400 able to do more buy backs, They're able to give 0:03:52.400 --> 0:03:55.360 out more dividends. So we feel that, you know, the 0:03:55.400 --> 0:03:58.680 banking sector as a whole is going to do well 0:03:58.760 --> 0:04:02.480 in an inflationary embo IMN. So that'll probably in that 0:04:02.640 --> 0:04:04.880 camp that says, you know, you're not going to get 0:04:04.920 --> 0:04:09.360 real sustained inflation in this economy until you get wage inflation. 0:04:09.360 --> 0:04:11.400 And we didn't even have wage inflation, I would argue 0:04:11.440 --> 0:04:14.600 before the pandemic, when we were at full employment. Do 0:04:14.640 --> 0:04:17.760 you think we will in fact have meaningful wage inflation 0:04:17.760 --> 0:04:23.800 in this economy as reopens. So even right now, you know, 0:04:24.080 --> 0:04:27.480 even in your program, I'm I'm listening to the advertisements 0:04:27.520 --> 0:04:30.159 by Amazon about you know, how they're going to get 0:04:30.200 --> 0:04:34.119 bonuses to workers to lure them, right, So I think 0:04:34.160 --> 0:04:37.880 that you know, as the economy recovers, you know there's 0:04:37.920 --> 0:04:40.640 going to be demand for labor and you know, companies 0:04:40.680 --> 0:04:42.320 are going to compete for it and they're going to 0:04:42.480 --> 0:04:45.280 have to pay higher prices as they are right now. 0:04:46.040 --> 0:04:48.440 Another thing that we are seeing going on part of 0:04:48.440 --> 0:04:53.640 the PAUL is this infrastructure package, and you know, because 0:04:53.640 --> 0:04:55.719 of this, we do feel that that's going to in 0:04:55.800 --> 0:04:59.279 one way or the other, get past. And because of that, 0:04:59.360 --> 0:05:01.320 you know, again, you know, more jobs are going to 0:05:01.400 --> 0:05:04.160 get created and we are going to see you know, 0:05:04.320 --> 0:05:08.240 wages also go higher. And you know, speaking of this 0:05:08.360 --> 0:05:12.039 infrastructure package, we really feel that this is something that 0:05:12.320 --> 0:05:16.359 is of dire need in the US because you know, 0:05:16.400 --> 0:05:20.360 when you travel to countries like let's say China or Singapore, 0:05:20.440 --> 0:05:24.280 you see how badly the US is lagging the rest 0:05:24.320 --> 0:05:28.000 of the world in infrastructure. According to the American Society 0:05:28.000 --> 0:05:31.599 of Civil Engineers, currently the US give it gives the 0:05:31.680 --> 0:05:35.240 US infrastructure a C minus great. So we feel that 0:05:35.240 --> 0:05:39.560 there's bipartisan support for this. And you know, even if 0:05:39.600 --> 0:05:44.760 we have to expand the national debt too to pass 0:05:44.839 --> 0:05:47.560 this infrastructure package, we would still be fine with it 0:05:48.080 --> 0:05:51.480 because the infrast rates costs are extremely low right now. 0:05:52.360 --> 0:05:54.280 Del thanks so much for joining us A deals. I'm 0:05:54.360 --> 0:05:57.640 on there as a partner at the Wall Street Alliance 0:05:57.720 --> 0:06:02.440 Group talking to us about inflatation and infrastructure. Really a 0:06:02.480 --> 0:06:04.840 couple of hot topics. We're gonna get more out on 0:06:04.960 --> 0:06:08.160 the at the Beige Book later tonight and or later today, 0:06:08.160 --> 0:06:11.160 I should say, and then obviously non farm payrolls on Friday. 0:06:11.200 --> 0:06:18.560 This is Bloomberg. Now. I love drugs, but they are expensive. 0:06:18.839 --> 0:06:21.480 Our next guest wants to do something about that and 0:06:21.920 --> 0:06:26.159 make them better as well at fighting diseases. Dr David 0:06:26.240 --> 0:06:31.200 gil Johan joins us now CEO of Execure, and you 0:06:31.279 --> 0:06:37.040 are using really fascinating future tech not only to make 0:06:37.120 --> 0:06:39.799 drugs that treat cancer and other rare diseases, but also 0:06:39.839 --> 0:06:45.080 to make them cost less. How's that working out? Yeah? 0:06:45.080 --> 0:06:48.040 Absolutely happy to be here today. Um. So we're using 0:06:48.120 --> 0:06:50.760 digital drug design, that's what we call to create new 0:06:50.839 --> 0:06:55.120 DNA based medicines to basically go after underlying causes the 0:06:55.200 --> 0:06:58.040 disease at their genetic source. The idea of being you 0:06:58.080 --> 0:06:59.840 want to go upstream and kind of turn off the 0:07:00.040 --> 0:07:02.760 half directly where the disease is coming from. And we 0:07:02.760 --> 0:07:06.000 can do that quite simply now by using your a's, 0:07:06.080 --> 0:07:08.960 g T, S and c's your genetic code to go 0:07:09.080 --> 0:07:12.560 right to that source. All right, dr have we how 0:07:12.560 --> 0:07:16.640 do any success stories in the biotech world using this 0:07:16.720 --> 0:07:20.840 type of technology or is this something new? Well, it's 0:07:21.280 --> 0:07:23.360 extra for a brand new thing that we're doing to 0:07:23.360 --> 0:07:26.560 go after some of these underlying causes genetic disease. But 0:07:27.040 --> 0:07:29.920 there's a really fascinating example that everybody now knows, which 0:07:29.920 --> 0:07:34.040 is Maderna. So Maderna used to create that vaccine for COVID, 0:07:34.160 --> 0:07:36.520 you know that a g T c idea. You can 0:07:36.520 --> 0:07:38.520 just simply look at the genetic code of the COVID 0:07:39.040 --> 0:07:41.760 variant and you can start to create that drug directly 0:07:41.840 --> 0:07:45.760 to make drugs faster and ultimately cheaper for patients. And 0:07:45.960 --> 0:07:47.960 what else can they What else do you think we're 0:07:47.960 --> 0:07:50.080 gonna be able to treat well with RNA with m 0:07:50.200 --> 0:07:54.240 RNA drugs. Yeah, we're creating all kinds of different m 0:07:54.360 --> 0:07:56.800 RNA and RNA drugs that execure. So we're going after 0:07:56.840 --> 0:07:59.400 things as diverses cancer, you know, which are genetically caused 0:07:59.480 --> 0:08:02.480 disease is Well, we have things like freeers of taxia 0:08:02.680 --> 0:08:07.400 Huntington's disease, Alzheimer's, things that are everywhere from your brain 0:08:07.440 --> 0:08:10.040 to your skin to your eyes, to your lungs, really 0:08:10.120 --> 0:08:12.400 everywhere within your body. You have the ability now to 0:08:12.520 --> 0:08:15.720 targets United code UM and finally that technology is arrived 0:08:15.760 --> 0:08:18.160 and we think execure has one of those keys to 0:08:18.200 --> 0:08:20.640 allow that to be the case. So dr You know 0:08:20.640 --> 0:08:22.160 a lot of folks out there when they think about 0:08:22.240 --> 0:08:25.360 the COVID vaccinations that are out there, whether it's the 0:08:25.360 --> 0:08:27.360 fires or them Darren or the J and J, you know, 0:08:27.400 --> 0:08:29.320 one of the concerns is, boy, they just gotta prove 0:08:29.440 --> 0:08:32.160 so fast. Everybody's you know, I'm used to these drugs 0:08:32.200 --> 0:08:35.000 taking years to get approved and NIGAT improved in less 0:08:35.000 --> 0:08:38.320 than a year. What's what do you say to that? 0:08:38.400 --> 0:08:39.800 Is that? Is that just a function of Hey, the 0:08:39.840 --> 0:08:44.280 technology is better? What do you say, Well, absolutely, I mean, 0:08:44.280 --> 0:08:47.040 it's obviously driven by an urgent need, right, so we 0:08:47.080 --> 0:08:49.920 need to move faster. Regulations need to be moved the 0:08:50.000 --> 0:08:52.760 l side in some cases to go faster. The amount 0:08:52.760 --> 0:08:56.160 of resources that was dumped into creating those technologies and 0:08:56.280 --> 0:08:58.800 getting it up fast was also tremendous. But it really 0:08:58.840 --> 0:09:01.280 just goes to show the hour of when you put 0:09:01.520 --> 0:09:04.040 some of these new technologies like DNA and RNA medicines 0:09:04.120 --> 0:09:07.440 to work. How quickly you can solve something that's so pressing, Um, 0:09:07.480 --> 0:09:10.000 you know, societal challenge or a personal challenge for folks 0:09:10.040 --> 0:09:12.760 as well. So that same technology can be applied to 0:09:12.760 --> 0:09:16.240 everything from cancers to lung disease. We just have to 0:09:16.720 --> 0:09:19.000 come up with the mustard to do it and the technologies, 0:09:19.080 --> 0:09:21.200 Like we have an execure in our spiritus leg after 0:09:21.240 --> 0:09:24.559 it to go after it. So how long till we 0:09:24.640 --> 0:09:27.439 find a way to cure cancer? How long do we 0:09:27.480 --> 0:09:32.400 have to deal with cancer? Because it's a real pain. Cancers. 0:09:32.559 --> 0:09:34.720 Cancer is gonna be all around. I mean, cancers are 0:09:34.720 --> 0:09:36.760 not going anywhere. I mean it's it's going to continue 0:09:36.800 --> 0:09:39.760 to manifest itself. You know, we have that issue. You 0:09:39.800 --> 0:09:43.400 can't obviously go one step without running to somebody who's 0:09:43.440 --> 0:09:46.120 dealt with cancer in their family. Um. You know, the 0:09:46.240 --> 0:09:48.760 idea is, once you have that cancer, rather than use 0:09:48.800 --> 0:09:51.880 something like a chemo therapeutic or an antibody, which can 0:09:51.920 --> 0:09:53.720 be very non specific and lead to all kinds of 0:09:53.720 --> 0:09:57.280 side effects, why not go after that underlying genetics that's 0:09:57.320 --> 0:10:00.360 causing cancer. Everything comes down to your genes and end. 0:10:00.800 --> 0:10:03.719 So why can't we specifically target those cancer cells when 0:10:03.720 --> 0:10:06.400 they exist and go after treating those cancers, you know, 0:10:06.520 --> 0:10:09.520 rather than you know, using the nuclear option and going 0:10:09.559 --> 0:10:13.000 after some of these things with not specific chemo therapeutics. 0:10:13.040 --> 0:10:16.760 So at execure, what are you guys targeting? What's your 0:10:17.080 --> 0:10:20.920 your home run that you're hoping to hit. Yeah, so 0:10:20.960 --> 0:10:23.920 we're using a technology that we call spherical nucleic acid 0:10:24.120 --> 0:10:26.560 or s n A. And so you are talking now 0:10:26.559 --> 0:10:29.839 about DNA and RNA based medicines. This is a storical 0:10:29.960 --> 0:10:33.320 version of the Yeah, coush balls, absolutely, so I really 0:10:33.320 --> 0:10:36.120 love the couch balls analogy. Here, we put DNA and 0:10:36.280 --> 0:10:39.640 RNA on the outside of a nanoparticle, and by putting 0:10:39.720 --> 0:10:41.920 DNA in RNA on the outside, we're able to get 0:10:41.960 --> 0:10:45.120 those DNA RNA structures in the cells. And once we're 0:10:45.160 --> 0:10:47.320 in the cells, now we can start going after those 0:10:47.400 --> 0:10:51.920 defuncts or misread genetic codes to reprogram things, if you will, 0:10:52.280 --> 0:10:56.120 to be more correct for the patient need. And so 0:10:56.120 --> 0:10:58.599 we're gonna able to do this very quickly. Yeah, I 0:10:58.960 --> 0:11:01.400 gotta ask just finally, because he's going through a messy 0:11:01.440 --> 0:11:04.120 process right now. But Bill Gates has done so much 0:11:04.240 --> 0:11:08.720 for mankind already. What's it like working with a genius 0:11:08.760 --> 0:11:12.360 like that? Yeah, well, very grateful to have an investor 0:11:12.440 --> 0:11:14.880 like Bill Gates in our company. I think he sees 0:11:14.920 --> 0:11:17.800 the parallels between what we're doing, the a's, g's, t's, 0:11:17.840 --> 0:11:20.559 and c's, which is the genetic code and the zero 0:11:20.600 --> 0:11:23.320 one zero one of you know, the Internet age and 0:11:23.480 --> 0:11:26.800 DNA and programming right that you get on your computer. 0:11:26.880 --> 0:11:29.680 Everything from your high phone to computer and everything in 0:11:29.720 --> 0:11:32.440 between is is governed by those zeros and ones. So 0:11:32.440 --> 0:11:34.800 I think there's some great parallels there. I think Bill 0:11:34.840 --> 0:11:37.800 Gates is a visionary and putting those two things together 0:11:37.840 --> 0:11:40.040 and thinking about medicine the same way we're thinking about 0:11:40.080 --> 0:11:41.880 the digital age is a great way to look at 0:11:41.960 --> 0:11:45.319 developing drugs for future. Yep, David, thank you so much 0:11:45.400 --> 0:11:48.200 for joining us. We really appreciated Dr David gilt Johannes. 0:11:48.360 --> 0:11:54.200 He's a CEO of biotech company Execure. Let's getting now 0:11:54.320 --> 0:11:57.599 over to Christina Hooper. She's a chief Global market strategist 0:11:57.760 --> 0:12:01.800 at Investco and she joins us with um around of 0:12:01.880 --> 0:12:04.079 what we need to be watching right now for in 0:12:04.120 --> 0:12:07.679 these markets. Christine, I guess, um the Beige Book comes 0:12:07.720 --> 0:12:13.360 out tonight. How many watching closely for shortages of of 0:12:13.440 --> 0:12:16.680 goods and also to see how tight the labor forces. 0:12:16.800 --> 0:12:20.800 But probably the big deal data point to follow is 0:12:20.880 --> 0:12:26.160 the non farm payrolls on Friday. Right, But what's great 0:12:26.200 --> 0:12:29.560 about the Beige Book is it helps provide stories. It 0:12:29.640 --> 0:12:33.560 gives color around the data points that we get. And 0:12:33.640 --> 0:12:35.880 so the last page book that came out in April 0:12:36.280 --> 0:12:40.400 I think helped make a sense of the most recent 0:12:40.559 --> 0:12:44.559 that April jobs report, which was disappointing. Um, we're not 0:12:44.679 --> 0:12:48.359 enough jobs were created as expected, as had been expected, 0:12:48.760 --> 0:12:54.079 and that helped provide a little backstory on it all. Right, So, Christine, 0:12:54.080 --> 0:12:56.640 I think one of the key issues that investors are 0:12:56.679 --> 0:12:59.400 trying to get a handle on right now is inflation. 0:12:59.440 --> 0:13:01.760 We certainly see it in various parts of the economy, 0:13:01.760 --> 0:13:04.720 whether you're looking at uh, you know, of the economy, 0:13:04.720 --> 0:13:07.240 whether you're looking at commodities such as the soft commodities 0:13:07.280 --> 0:13:10.760 or even metals or and crude. The question is is 0:13:10.760 --> 0:13:13.960 it something transitory like the Federal Reserve is suggesting, or 0:13:14.000 --> 0:13:17.000 is it something more long lasting which may be problematic 0:13:17.559 --> 0:13:22.480 to the markets. Where do you come down on that question? Well, 0:13:22.480 --> 0:13:24.600 the irony is we won't know until it's in our 0:13:24.600 --> 0:13:27.880 rear view mirror, right, But what I would argue is that. 0:13:27.920 --> 0:13:31.160 I think it's more likely to be transitory. We are 0:13:31.320 --> 0:13:38.480 right now witnessing uh an incredibly strong UM economic growth spurt. UM, 0:13:38.520 --> 0:13:43.080 we are reopening the economy, we have elevated household savings, 0:13:43.160 --> 0:13:46.280 we have pent up demand. It's almost a perfect storm 0:13:46.280 --> 0:13:49.120 in the positive sense. So it makes sense that we 0:13:49.160 --> 0:13:53.480 would see just a very significant increase in demand for 0:13:53.520 --> 0:13:56.920 all kinds of things. We have the supply chain disruptions 0:13:56.960 --> 0:14:01.040 contributing to these issues, and of course UM there is 0:14:01.240 --> 0:14:04.400 a smaller group of people willing to work right now 0:14:04.480 --> 0:14:08.480 because of concerns about COVID nineteen which is ebbing, but 0:14:08.679 --> 0:14:13.319 also of course difficulty with childcare. Some schools are still online, 0:14:13.559 --> 0:14:16.760 daycare isn't at full capacity in some places. So all 0:14:16.800 --> 0:14:19.680 those things are likely to get worked out over the 0:14:19.680 --> 0:14:22.760 shorter term. We're not going to be taking vacations forever. 0:14:22.840 --> 0:14:25.040 We'll get it out of our systems soon. So I 0:14:25.040 --> 0:14:29.560 would argue it's more likely to be transitory. UM. Even 0:14:29.640 --> 0:14:32.800 if that's the case, there are still problems with price 0:14:32.840 --> 0:14:35.840 increases in a lot of really important areas like housing 0:14:36.360 --> 0:14:38.080 and I I saw a great piece on the m 0:14:38.160 --> 0:14:41.440 Live blog today from West Goodman pointing out that central 0:14:41.440 --> 0:14:45.400 banks in Europe, in the UK and Canada and the 0:14:45.520 --> 0:14:48.480 US are all watching this closely, all a little bit 0:14:48.480 --> 0:14:50.880 worried that this could be the straw that breaks the 0:14:50.920 --> 0:14:53.080 camels back in terms of tapering. What do you think 0:14:53.120 --> 0:14:57.880 of the soaring housing prices. Well, it's certainly a concern, 0:14:58.080 --> 0:15:00.640 and we do have members of the S well i'm see, 0:15:00.680 --> 0:15:04.120 who are focused on that um But what I would 0:15:04.160 --> 0:15:08.360 say is that it is not um It is not 0:15:08.560 --> 0:15:12.600 to me as big a concern as for example, wage growth. 0:15:12.640 --> 0:15:15.040 We want to follow that closely. That tends to create 0:15:15.440 --> 0:15:19.640 uh stickier inslation. Just because housing is a function of 0:15:19.840 --> 0:15:24.040 a variety of other components, like, for example, a desire 0:15:24.160 --> 0:15:28.920 to um own as opposed to rent, there's always the option. 0:15:29.200 --> 0:15:31.960 I think the market often corrects itself when prices get 0:15:32.000 --> 0:15:35.520 too high, people opt to rent. So I don't worry 0:15:35.520 --> 0:15:37.760 as much about the housing market as I worry about 0:15:37.760 --> 0:15:40.880 other parts of the economy. Christina. Earlier this morning, Tom 0:15:40.960 --> 0:15:43.760 Keene and I were speaking to Doug Cass of Sea 0:15:43.760 --> 0:15:45.640 Breeze Partners, and he was making a case that he 0:15:45.720 --> 0:15:49.920 is pretty darn close to becoming net short this market, 0:15:50.280 --> 0:15:53.760 setting a number of reasons including valuation, How do you 0:15:53.800 --> 0:15:58.720 feel about valuation of this market right here? Well, valuations 0:15:59.120 --> 0:16:03.600 are stretched for parts of this market. UM. But having 0:16:03.760 --> 0:16:06.880 said that, UM, we have everything is relative and we 0:16:06.920 --> 0:16:09.440 have to look at in the context of monetary policy, 0:16:09.480 --> 0:16:13.680 which is incredibly accommodative right now. UM. So I think 0:16:13.720 --> 0:16:17.880 it does really alter UM the landscape when we look 0:16:17.920 --> 0:16:21.560 at valuations. So what I would say is that we 0:16:21.600 --> 0:16:24.720 don't want to abandon the stock market, UM, but we 0:16:24.800 --> 0:16:28.160 do want to add in components of our portfolio that 0:16:28.240 --> 0:16:31.880 have lower valuations, and sometimes that means going outside the US, 0:16:33.520 --> 0:16:38.920 going outside the US and where too, well, Uh, European 0:16:38.960 --> 0:16:43.840 equities have lower valuations, emerging markets equities, and you can 0:16:43.880 --> 0:16:47.000 make the argument with Europe that it is following the 0:16:47.040 --> 0:16:50.440 path of the US, UM, but it has longer legs 0:16:50.600 --> 0:16:52.600 just because it is not as far along and it's 0:16:52.680 --> 0:16:56.040 it's economic recovery. All right, Christina, thank you so much. 0:16:56.080 --> 0:16:59.360 We always appreciate getting your market opinions and thoughts here. 0:16:59.440 --> 0:17:03.280 Christina who she's a chief Global market strategist for invest Go. 0:17:05.760 --> 0:17:07.920 One of the leading stories in the world of sports 0:17:08.000 --> 0:17:11.199 right now is Naomi Osaka and her withdrawal from the 0:17:11.280 --> 0:17:15.800 French Open. Naomi cited, among other things, dealing she needs 0:17:15.800 --> 0:17:18.760 to deal time to deal with some mental health issues, 0:17:18.800 --> 0:17:21.479 and that certainly brings to the for you know, mental 0:17:21.480 --> 0:17:25.399 health and the pandemic and how that's impacted mental health 0:17:25.720 --> 0:17:28.159 of folks across the board. Our next guest has some 0:17:28.240 --> 0:17:31.240 thoughts there, George Goldsmith. He's co founder, chairman and chief 0:17:31.240 --> 0:17:35.800 executive officer of Compass Pathways. Uh and talking about you know, 0:17:35.960 --> 0:17:40.639 mental therapy using potentially psychedelic therapi is George, thanks so 0:17:40.680 --> 0:17:44.159 much for joining us here. Again, mental health always on 0:17:44.200 --> 0:17:46.439 the front of people's minds, but maybe even more so 0:17:46.600 --> 0:17:50.000 during this pandemic. Talk to us about what you folks 0:17:50.080 --> 0:17:54.919 at Compass Pathways are doing towards this issue. Thanks so 0:17:55.000 --> 0:17:57.880 much for having me on. I really appreciate this opportunity. 0:17:57.920 --> 0:18:00.879 And you're right, you know, not only is this top 0:18:00.920 --> 0:18:03.400 of mind for so many of us, particularly coming out 0:18:03.440 --> 0:18:06.640 of the pandemic, and we're reading about it, whether it's 0:18:06.720 --> 0:18:11.000 sports stars or royal family members, I think that it's 0:18:11.040 --> 0:18:13.760 now something we can talk about and it's really important 0:18:13.760 --> 0:18:18.360 because this is a huge, un undescribed problem. Far too 0:18:18.400 --> 0:18:22.000 often there's just in depression alone. We have a hundred 0:18:22.000 --> 0:18:25.000 million people who aren't helped by what exists today in 0:18:25.080 --> 0:18:28.080 terms of therapies, and we created Compass really to look 0:18:28.119 --> 0:18:31.719 at how we create affordable new treatments for that. And 0:18:31.720 --> 0:18:33.840 one of the things that's really caught our interests and 0:18:33.880 --> 0:18:38.280 focus is looking at psilocybin, which is a psychedelic medicine, 0:18:38.280 --> 0:18:41.520 and bringing that into clinical trials based on some really 0:18:41.560 --> 0:18:46.720 exciting early stage studies. So what can be done? I'll say, UM, 0:18:46.840 --> 0:18:49.280 I agree that I don't think mental health issues should 0:18:49.280 --> 0:18:54.040 be stigmatized. I think it should be like physical health issues, um, 0:18:54.080 --> 0:18:56.040 you know, like if you break an arm or if 0:18:56.080 --> 0:19:01.040 you have back problems. I had, I think, a really 0:19:01.080 --> 0:19:04.880 intense about of depression and anxiety brought on by lyme disease. 0:19:05.480 --> 0:19:09.200 And I was fortunate enough to find doctors, um who 0:19:09.280 --> 0:19:12.000 understood what was going on and gave me fluvoxing me 0:19:12.119 --> 0:19:14.560 and some other drugs that really helped a lot. And 0:19:14.800 --> 0:19:16.359 you know, I was back on my feet and and 0:19:16.400 --> 0:19:19.359 ready to rumble in a month. And I'm I'm really 0:19:19.400 --> 0:19:21.879 glad that I didn't kind of hide away as was 0:19:21.920 --> 0:19:25.359 my initial you know, as was my initial reaction or 0:19:25.440 --> 0:19:30.240 my initial um uh IDEA, what can be done with 0:19:30.280 --> 0:19:32.600 silo cybin that can't be done with ss r I 0:19:32.720 --> 0:19:36.360 s and other drugs that are so helpful already. Sure, 0:19:36.400 --> 0:19:38.959 I think that they are. There's a lot of different 0:19:39.000 --> 0:19:41.719 treatments that do make a difference for a lot of people, 0:19:41.840 --> 0:19:44.720 but unfortunately not for nearly enough. And this is the 0:19:44.800 --> 0:19:48.199 hundred million people who are so called treatment resistant. And 0:19:48.280 --> 0:19:51.000 by the way, I really appreciate you sharing your story. 0:19:51.080 --> 0:19:53.160 We like to say everyone has a story, and as 0:19:53.200 --> 0:19:56.600 we look around, whether it's friends, family, we all see 0:19:56.680 --> 0:19:59.840 someone who has struggled at some point, and often, you know, 0:20:00.040 --> 0:20:03.320 even ourselves, and I think this is really important. So 0:20:03.359 --> 0:20:05.880 thank you for sharing your story, and hopefully more people can. 0:20:06.280 --> 0:20:09.640 What's different about our approach is that, first of all, 0:20:09.680 --> 0:20:12.240 it's targeted for people who aren't helped by current approaches, 0:20:12.280 --> 0:20:13.720 and there are a lot of them. As I mentioned, 0:20:14.040 --> 0:20:18.080 our approach is really very, very different. It's a single 0:20:18.160 --> 0:20:22.680 dose of a high high dose of psilocybin um, which 0:20:22.760 --> 0:20:26.480 is the active ingredient in magic mushrooms. It's a psychedelic 0:20:26.680 --> 0:20:30.159 medicine that was really explored a great deal in the 0:20:30.200 --> 0:20:33.919 fifties and sixties, and then obviously they became illegal as 0:20:33.960 --> 0:20:36.399 they escaped the laboratory, and we have the sixties and 0:20:37.160 --> 0:20:41.119 so forth. Um but Alee and the acid test still 0:20:41.160 --> 0:20:45.960 on tour with the Grateful Dead and friends, you bet right, 0:20:46.440 --> 0:20:50.520 and so so all of this then somehow inspired a 0:20:50.560 --> 0:20:55.520 group of scientists because between ninet nineteen sixty people were 0:20:55.560 --> 0:21:01.159 in trials with LSD and lesser psilocybic. This revisited in 0:21:01.240 --> 0:21:05.080 the two thousands by JOHNS. Hopkins, n y U, U 0:21:05.080 --> 0:21:08.359 c L A Imperial College in London, all showed really 0:21:08.400 --> 0:21:11.600 promising studies. We created Compass to build on the early 0:21:11.720 --> 0:21:14.080 evidence and bring it to patients and make sure it 0:21:14.119 --> 0:21:17.360 was accessible through rigorous clinical trials. And right now we're 0:21:17.359 --> 0:21:20.560 finishing up our phase to trial, which is the phase 0:21:20.640 --> 0:21:23.280 that goes before the next. It's the next, the last 0:21:23.320 --> 0:21:26.000 phase to get to patients, and we'll be reporting out 0:21:26.040 --> 0:21:28.640 on that next year or d end of this year actually, 0:21:28.760 --> 0:21:31.280 And I think what's really important is we're doing that 0:21:31.359 --> 0:21:34.960 in ten countries because the problem is global and the 0:21:35.040 --> 0:21:38.240 need is high. So we're really excited about the work 0:21:38.280 --> 0:21:41.160 that we're doing and we'll have results to report out 0:21:41.160 --> 0:21:44.400 and hopefully those will build on the incredibly interesting results 0:21:44.400 --> 0:21:47.080 of the prior studies. Again, what's really cool here a 0:21:47.160 --> 0:21:53.640 single dose on carefully controlled, simple situation given by professionally 0:21:53.760 --> 0:21:57.200 trained people. Um, it's a really different model, and how's 0:21:57.280 --> 0:22:02.000 people see their lives differently. What you mentioned cost before, 0:22:02.080 --> 0:22:03.320 Can you give us a sense of kind of the 0:22:03.400 --> 0:22:06.120 cost of maybe this type of treatment that you guys 0:22:06.119 --> 0:22:08.760 are focusing on versus maybe what's more traditional in the 0:22:08.760 --> 0:22:12.639 marketplace now? Well, I think one of the things that's happening, 0:22:12.680 --> 0:22:14.800 I'm sure you've covered it other places, it's a move 0:22:14.880 --> 0:22:17.520 to value based pricing and how that works, and we 0:22:17.560 --> 0:22:20.960 really think it's we're accountable for how much value can 0:22:21.000 --> 0:22:24.040 we create. So it's premature until we have the research 0:22:24.119 --> 0:22:27.320 to be able to talk about how much this would cost, 0:22:28.119 --> 0:22:31.199 until we understand who benefits, how how much of benefit, 0:22:31.240 --> 0:22:33.920 how long it lasts. So that's all work being done. 0:22:34.280 --> 0:22:36.720 But we clearly make a view that this has to 0:22:36.720 --> 0:22:40.120 be affordable. The problem is huge, and again with such 0:22:40.240 --> 0:22:45.040