WEBVTT - Bitcoin Soars, Trump Impact on Oil Producers 0:00:00.080 --> 0:00:06.760 Bloomberg Audio Studios, podcasts, radio news. 0:00:08.240 --> 0:00:12.119 You're listening to the Bloomberg Intelligence Podcast. Catch us live 0:00:12.200 --> 0:00:14.920 weekdays at ten am Eastern on Apple car Playing and 0:00:15.040 --> 0:00:15.840 Broyd Auto. 0:00:15.640 --> 0:00:17.040 With the Bloomberg Business App. 0:00:17.079 --> 0:00:20.279 Listen on demand wherever you get your podcasts, or watch 0:00:20.360 --> 0:00:22.280 us live on YouTube. 0:00:23.239 --> 0:00:26.520 Molly, A lot of movement here in a commodity's gold off, 0:00:26.600 --> 0:00:28.640 big Bitcoin. 0:00:28.360 --> 0:00:31.640 Ripping, absolutely ripping. So who do we eaty two thousand? 0:00:31.840 --> 0:00:32.040 Yes? 0:00:32.240 --> 0:00:32.960 So who do we talk to? 0:00:33.040 --> 0:00:36.920 We talked to Michael bloone Miami, Mike, Senior Commodity Strategies 0:00:36.960 --> 0:00:40.840 for Bloomberg Intelligence. Safely esconced in Miami. He was doing 0:00:40.920 --> 0:00:43.760 Miami before it was really chic. He was down there early. 0:00:44.120 --> 0:00:47.080 Mike talked to us first about Bitcoin eighty two. We're 0:00:47.120 --> 0:00:49.640 pushing up against eighty three thousand dollars per token. 0:00:49.920 --> 0:00:50.640 What's happening here? 0:00:51.680 --> 0:00:54.640 The world changed last Tuesday and it's almost a perfect 0:00:54.840 --> 0:00:58.040 storm for bitcoin. So think of all the anti bitcoin 0:00:58.200 --> 0:01:02.680 regulation and pushback from the pre Use Administration and Gary Gensler, 0:01:03.120 --> 0:01:06.720 that's completely flipped. It's delightful to see for some of 0:01:06.840 --> 0:01:08.800 us who wrote about this five years ago that any 0:01:08.959 --> 0:01:12.240 US representative or regulator that did not understand that the 0:01:12.280 --> 0:01:14.720 base layer of this place was actually organically went for 0:01:14.800 --> 0:01:19.040 the dollar most widely trading bitcoin cryptos not bitcoin. It's 0:01:19.040 --> 0:01:22.760 actually tether. The dollar token was Finally, it's delightful to 0:01:22.800 --> 0:01:25.280 see them figuring it out. What's really happening in this space. 0:01:25.319 --> 0:01:28.840 So it's nothing but good for bitcoin. The market's getting frothy, 0:01:28.959 --> 0:01:30.760 but it had a good period of six months which 0:01:30.800 --> 0:01:33.080 just hung out. Now it's just taking off and you're 0:01:33.120 --> 0:01:36.280 seeing massive inflows in ETFs. People can get exposed to 0:01:36.400 --> 0:01:39.240 it and it's kind of kicking into the little match. 0:01:39.440 --> 0:01:42.240 Is a digital goal or is leverage stock market? Right now, 0:01:42.280 --> 0:01:45.119 it's stock workers making new high bitcoins, making new high 0:01:45.160 --> 0:01:46.680 bitcoins back to it leadership role. 0:01:47.360 --> 0:01:50.320 Mike, tell me how much of this trade right now 0:01:50.480 --> 0:01:54.000 is dependent on Gary Gensler not being in the SEC 0:01:54.840 --> 0:01:56.080 and it can trump? 0:01:56.120 --> 0:01:56.840 Honestly do that? 0:01:58.120 --> 0:02:00.520 Oh sure, well he's going to be gone within months. 0:02:00.880 --> 0:02:04.600 It's just a question of when. He's very unfavorable SEC chairman. 0:02:04.680 --> 0:02:06.320 He made a lot of enemies on both sides of 0:02:06.360 --> 0:02:08.880 the aisle, but this is just part of what got 0:02:08.960 --> 0:02:11.040 him elected. It's the key thing I think the market's 0:02:11.080 --> 0:02:14.880 figuring out is let's not underestimate this. In Bolden next president. 0:02:15.000 --> 0:02:19.600 He has been re elected by completely decisive election, and 0:02:19.720 --> 0:02:21.880 his mantra everything he said in his campaign, I'd say 0:02:21.919 --> 0:02:24.280 be careful to disagree with. For instance, I'm reading the 0:02:24.360 --> 0:02:27.600 latest book for Robert Leiittheiser, who was his past trade representative, 0:02:27.960 --> 0:02:31.680 and it's called no trade is Free, and we shouldn't 0:02:31.680 --> 0:02:33.600 expect him to do what he says, partly because he 0:02:33.600 --> 0:02:36.679 has carte blanche at least to the midterms, and there's 0:02:36.760 --> 0:02:39.560 still pretty significant trade depthsits So from a commodity standpoint, 0:02:39.600 --> 0:02:43.240 it's very bearish. From a bitcoin standpoint, it's very bullish, 0:02:43.280 --> 0:02:45.480 partly because he tilted over and he got the bitcoin 0:02:45.560 --> 0:02:47.480 people on his side. I don't think he wants to 0:02:47.600 --> 0:02:48.160 upset them. 0:02:49.200 --> 0:02:52.480 Mike, I can't even remember the last time we talked 0:02:52.480 --> 0:02:57.840 about valuation and how you're supposed to value bitcoin. Just 0:02:57.919 --> 0:03:00.000 refresh our memory on how you think about that whole consent. 0:03:00.919 --> 0:03:05.440 Yeah, well, in pectical analysis, so I mean, I like 0:03:05.520 --> 0:03:07.919 to compare it versus gold right now I'm looking at it. 0:03:08.000 --> 0:03:11.640 It's as some hedge fund managers call it, the fastest 0:03:11.680 --> 0:03:13.960 horse in the race. I mean versus all risk acids. 0:03:14.240 --> 0:03:16.919 The risk right now is bitcoins making new record highst 0:03:16.919 --> 0:03:19.840 but it's correlation sixty day correlation to this SMB five 0:03:19.960 --> 0:03:22.240 hundred ato point seven or so is the highest ever 0:03:22.440 --> 0:03:25.000 on the way up, So it's a leading risk acid. 0:03:25.080 --> 0:03:28.120 It's rice for all this optimism about us, you know, 0:03:28.600 --> 0:03:31.639 the Trump election, but markets are so expensive ready versus 0:03:31.639 --> 0:03:34.600 when he was elected twenty sixteen, they were very low. 0:03:34.760 --> 0:03:38.160 Certainly bitcoin was. So there's so many ways, but stocks 0:03:38.200 --> 0:03:39.760 to use is one way to do it. The key 0:03:39.840 --> 0:03:42.360 thing that I like to say is there's definable diminishing 0:03:42.480 --> 0:03:46.640 supply and you can see that by just the code, 0:03:46.680 --> 0:03:49.120 and there's increasing demand and adoption, so over time the 0:03:49.160 --> 0:03:51.600 price must go up. And right now it had a 0:03:51.720 --> 0:03:56.240 major switch flip that this the unexpected election of mister 0:03:56.320 --> 0:03:59.360 Trump has just flipped it over to the bullish spirits 0:03:59.360 --> 0:03:59.760 at the moment. 0:04:00.040 --> 0:04:02.240 Now, this is something I was really surprised to read 0:04:02.360 --> 0:04:05.560 in one of our stories that bitcoin now ranks only 0:04:05.760 --> 0:04:08.760 second to the fossil fuel industry, or rather the crypto 0:04:08.840 --> 0:04:12.360 industry at large, and total money deployed since the twenty 0:04:12.480 --> 0:04:16.440 ten Supreme Court decision that limited funds on campaign political 0:04:16.480 --> 0:04:20.440 spending that's shocking anyone else to think that crypto is 0:04:20.560 --> 0:04:23.920 number two to fossil fuels. Where is all this cap 0:04:24.440 --> 0:04:26.240 campaign influence money coming from? 0:04:26.279 --> 0:04:26.440 Mike? 0:04:26.440 --> 0:04:27.800 Who are the big spenders here? 0:04:28.680 --> 0:04:30.279 So well, I don't know exactly who they are. I mean, 0:04:30.440 --> 0:04:33.120 last time we heard from the bidenminstration, Sam Bankman Freed 0:04:33.200 --> 0:04:35.360 was the number two donator. That didn't work out so well. 0:04:35.480 --> 0:04:38.960 That's why partly the bidenministration pushed back after the collapse 0:04:39.000 --> 0:04:41.200 at the FTX. The bottom line is, let's look at 0:04:41.240 --> 0:04:46.920 an ETPs now ETFs Bitcoin's about ninety two billion. Total 0:04:47.080 --> 0:04:49.800 gold ETPs are about two hundred and thirty billions, so 0:04:49.880 --> 0:04:52.520 let's catching up fast. And remember this Bitcoin's only been 0:04:52.560 --> 0:04:55.600 trading in exchange traded funds for a few years. Gold's 0:04:55.640 --> 0:04:58.520 been almost twenty years in exchange traded funds. So it's 0:04:58.760 --> 0:05:02.120 just the you know, the digital goal is taken on 0:05:02.200 --> 0:05:04.239 the old analog goal, and the question where it stops. 0:05:04.279 --> 0:05:07.080 The way I see it right now is yes, everything 0:05:07.200 --> 0:05:09.560 looks so bullish, it's just a little bit expensive. But 0:05:09.640 --> 0:05:12.600 I published today is bitcoin digital gold or is it 0:05:12.760 --> 0:05:15.400 leverage baiting? Right now? It's much more leveraged version the 0:05:15.440 --> 0:05:19.080 stock market and animal spirits are in full force. 0:05:19.720 --> 0:05:22.840 Uh you mentioned gold, Mike. Gold is down about two 0:05:22.880 --> 0:05:26.279 point three percent today. What's the trade here in gold? 0:05:26.400 --> 0:05:28.200 Is this just a taking some money off the table 0:05:28.200 --> 0:05:28.720 after a big. 0:05:28.680 --> 0:05:33.440 Run, potential lesson of geopolitical risks, the definitive election of 0:05:33.480 --> 0:05:37.400 Donald Trump. Gold was way overdue for a correction of 0:05:37.520 --> 0:05:40.480 already hearing of inklings of mister Putin and mister Trump 0:05:40.560 --> 0:05:43.800 talking this last weekend. And if there's any you know, 0:05:44.200 --> 0:05:46.240 Dayton coming in the world, that's going to be a 0:05:46.320 --> 0:05:48.720 major pressure factor for gold. But in the meantime, gold 0:05:48.760 --> 0:05:50.560 on the one year basis is still up about the 0:05:50.600 --> 0:05:52.919 same as S and P five hundred, around thirty five percent. 0:05:53.160 --> 0:05:55.799 It's way overdue for a correction. I'm looking at twenty 0:05:55.920 --> 0:05:58.200 four to twenty five hundred as good support level as 0:05:58.200 --> 0:06:00.360 it could come back to. It just got way too bensive. 0:06:00.600 --> 0:06:03.920 So at its peak I think that was early October, 0:06:04.040 --> 0:06:05.920 is up thirty nine percent of the year. That would 0:06:05.960 --> 0:06:07.840 have been the best year since nineteen seventy nine. So 0:06:07.880 --> 0:06:10.640 it's a bull market pulling back. But then looking forward, 0:06:10.760 --> 0:06:13.320 if there's much if there's a major shift in what's 0:06:13.400 --> 0:06:16.680 happening in China, I mean, mister Z kind of filtering 0:06:16.720 --> 0:06:19.880 away from President Putin maybe towards the US. That's bad 0:06:19.960 --> 0:06:22.280 for gold, But overall it's the key thing is there's 0:06:22.279 --> 0:06:25.520 still some major geopolitical factors supporting going to the bottom line, 0:06:25.560 --> 0:06:29.960 like say, for gold, is gold will be Gold's major catalyst. 0:06:30.040 --> 0:06:32.320 I think to go hires at some point when we 0:06:32.400 --> 0:06:34.640 see the next bear market in US stock market, maybe 0:06:34.720 --> 0:06:36.240 God help us if that ever happens again. 0:06:36.839 --> 0:06:39.120 All right, Mike, thanks so much for joining us. As always, 0:06:39.160 --> 0:06:39.719 Mike mclohan. 0:06:39.760 --> 0:06:43.320 He's a senior commodity strategist for Bloomberg Intelligence. 0:06:43.400 --> 0:06:45.600 B I go go check out all his research on 0:06:45.800 --> 0:06:46.640 all commodities. 0:06:46.880 --> 0:06:49.640 He covers everything from the sauce, you know, the grains, 0:06:49.720 --> 0:06:52.360 to the metals to the all kinds of stuff, including 0:06:52.440 --> 0:06:54.440 a bitcoin, so he kind of has it all covered there. 0:06:56.000 --> 0:06:59.840 You're listening to the Bloomberg Intelligence Podcast. Catch us live 0:07:00.040 --> 0:07:02.880 weekdays at ten am Eastern on applecar. 0:07:02.520 --> 0:07:05.240 Play and Android Auto with a Bloomberg Business act. 0:07:05.400 --> 0:07:08.200 You can also listen live on Amazon Alexa from our 0:07:08.240 --> 0:07:12.640 flagship New York station, Just Say Alexa Play Bloomberg eleven thirty. 0:07:14.480 --> 0:07:18.400 Kim Farrest joins US founder and chief investment Officer, Boca 0:07:18.680 --> 0:07:24.680 Capital Partners on zoom from Pittsburgh, one of my favorite towns. So, Kim, 0:07:24.760 --> 0:07:28.720 you woke up with your team on Wednesday last week. 0:07:29.680 --> 0:07:32.040 What changed for you guys, if anything? And your outlook 0:07:32.120 --> 0:07:34.480 for markets if anything? If anything? 0:07:35.280 --> 0:07:40.840 If anything, yeah, well, really nothing, because our few is 0:07:40.920 --> 0:07:44.280 the long term. We believe strongly that if you have 0:07:44.400 --> 0:07:46.800 money in the market, it should be in there for 0:07:46.840 --> 0:07:48.960 a minimum of three to five years. You know, you 0:07:49.000 --> 0:07:52.200 can think about harvesting what we do today in three 0:07:52.280 --> 0:07:53.840 to five years, so that. 0:07:54.000 --> 0:07:54.320 Kind of. 0:07:55.960 --> 0:07:58.720 You know, time heals a lot of wounds, we'll just say, 0:07:59.360 --> 0:08:02.640 and makes things better in the long run, and you 0:08:02.840 --> 0:08:06.120 just have to work with what you have. So that's 0:08:06.160 --> 0:08:09.640 what we're doing. And actually nothing changed because we were 0:08:09.680 --> 0:08:13.480 believers in having that Barbell strategy of large cap and 0:08:13.640 --> 0:08:18.640 small cap together. Small cap has been suffering for a 0:08:18.800 --> 0:08:22.800 myriad of reasons, and we're looking at and by small cap, 0:08:22.840 --> 0:08:25.080 I mean companies that have a billion or more in 0:08:25.160 --> 0:08:27.960 market cap. The microcaps were not at all interested in. 0:08:28.680 --> 0:08:31.920 So we think that, you know, the large caps have 0:08:32.000 --> 0:08:34.160 had a great run over the last couple of years, 0:08:34.640 --> 0:08:37.600 and it looks like maybe small cap will have its 0:08:37.720 --> 0:08:40.240 moment in the sun coming up in the next couple 0:08:40.280 --> 0:08:40.679 of years. 0:08:41.400 --> 0:08:43.240 So are you saying him that, like, you're not really 0:08:43.320 --> 0:08:45.839 buying into the Trump trade. You're not out there, you know, 0:08:46.040 --> 0:08:48.360 buying it's on a bitcoin and silling treasuries right now. 0:08:49.640 --> 0:08:51.880 I'm sorry, I couldn't even let you get that out. 0:08:52.280 --> 0:08:56.319 Buying a lot of bitcoin. Well, you know, paint me 0:08:56.360 --> 0:09:01.560 as old fashioned. While I think bitcoin is interesting to watch, 0:09:02.120 --> 0:09:03.719 I don't really know how to value it. 0:09:03.840 --> 0:09:04.160 I don't. 0:09:04.240 --> 0:09:08.440 I heard your guest on the prior segment also kind 0:09:08.480 --> 0:09:12.800 of reflecting that. And my big thing whenever I talk 0:09:12.920 --> 0:09:16.959 to investors that we serve about bitcoin is whenever you 0:09:17.000 --> 0:09:19.280 can pay your taxes with it, I'll pay attention to 0:09:19.440 --> 0:09:21.440 it then because that means it's. 0:09:21.320 --> 0:09:22.520 A real currency. 0:09:23.600 --> 0:09:25.800 Right now, it is not a real currency. 0:09:26.760 --> 0:09:29.960 So Kim, when when you look at the small caps, boy, 0:09:30.040 --> 0:09:32.920 you've got to have a good call on management because 0:09:32.960 --> 0:09:35.839 they have such an outsized influence on kind of just 0:09:35.960 --> 0:09:37.360 kind of how the business develops. 0:09:38.679 --> 0:09:40.000 You how do you do that with some of these 0:09:40.000 --> 0:09:40.959 smaller cap companies? 0:09:42.160 --> 0:09:44.960 Sure, well, first thing, we have time on our side. 0:09:45.040 --> 0:09:45.240 Case. 0:09:45.320 --> 0:09:47.480 I've been doing this for twenty four years and I 0:09:47.559 --> 0:09:50.559 started on the cell side, where my director of research 0:09:50.720 --> 0:09:53.360 encouraged me to have half small cap half large caps. 0:09:53.400 --> 0:09:56.360 So I'm kind of in the groove on this. But 0:09:56.480 --> 0:09:59.040 what I do is I look for several markers. First 0:09:59.080 --> 0:10:02.320 of all, growth is always important. I am not strictly 0:10:02.440 --> 0:10:05.319 a growth manager. I'm growth at a reasonable price, but 0:10:05.520 --> 0:10:08.480 growth has to be there. And how do you get growth, Well, 0:10:08.559 --> 0:10:10.839 you sell more product, and how do you do that 0:10:11.240 --> 0:10:14.680 product marketing? It sounds really boring, but what it really 0:10:14.880 --> 0:10:19.079 is is having a process to understand your client or 0:10:19.200 --> 0:10:23.080 customer and then having a repeatable process where you make 0:10:24.400 --> 0:10:27.000 your product and service to light your customer and they 0:10:27.080 --> 0:10:30.120 come back over and over and over again. And can 0:10:30.200 --> 0:10:32.760 it really be that easy? Yes, it is. It's hard 0:10:32.840 --> 0:10:34.400 to spot and you have to do a lot of 0:10:34.480 --> 0:10:37.880 fundamental research. But that's what we're doing, is looking for 0:10:38.040 --> 0:10:42.280 that kind of perpetual money machine where businesses know what 0:10:42.640 --> 0:10:45.880 clients they serve and every day get up and try 0:10:45.960 --> 0:10:47.160 to serve them the best they can. 0:10:47.880 --> 0:10:50.360 So it's like you've got you know, with earning season 0:10:51.160 --> 0:10:53.640 still going on, we've got the retailers coming up next. 0:10:54.120 --> 0:10:55.679 Just tell me about your view right now of the 0:10:55.800 --> 0:10:58.760 US consumer, the economy, at large. You know, there's been 0:10:58.960 --> 0:11:01.360 all these calls for slow down and it just hasn't 0:11:01.400 --> 0:11:04.560 really been all that noticeable yet, and so. 0:11:04.720 --> 0:11:06.920 Just wondering when you really think that tipping point's going 0:11:07.000 --> 0:11:07.320 to happen. 0:11:08.400 --> 0:11:12.040 Sure, well, I kind of have an unusual view of 0:11:12.120 --> 0:11:16.319 the economy. I think there's a lot of slowness out 0:11:16.360 --> 0:11:18.800 there if you go out and look for it, pretty 0:11:18.880 --> 0:11:22.080 much in people who are in the lower two thirds 0:11:22.160 --> 0:11:27.040 of the economic food chain, we'll just call it. There's 0:11:27.080 --> 0:11:30.280 a lot of stress. If you walk around stores like Walmart, 0:11:30.360 --> 0:11:32.480 you hear a lot of discussions about what we can 0:11:32.600 --> 0:11:35.319 and can't buy as a family, And I think that 0:11:35.480 --> 0:11:37.120 had a lot of influence. 0:11:36.720 --> 0:11:37.880 On the election, right. 0:11:38.760 --> 0:11:41.439 But more importantly, I'm not one of the people that 0:11:41.520 --> 0:11:45.000 are necessarily looking for the next recession either. I think 0:11:45.080 --> 0:11:48.240 we have these slowdowns now. And why do I think that, Well, 0:11:48.720 --> 0:11:53.719 companies have software in place like CRM Salesforce to be 0:11:53.800 --> 0:11:57.200 able to understand what their pipeline is, and then they 0:11:57.360 --> 0:12:02.120 have erp or exotic or very fancy accounting systems that 0:12:02.320 --> 0:12:05.280 let them match the supply and demand. So we have 0:12:05.440 --> 0:12:10.839 seen over the past twenty years very few or no 0:12:11.320 --> 0:12:14.559 recessions that were caused by too much capacity. 0:12:14.920 --> 0:12:15.040 Right. 0:12:15.800 --> 0:12:19.040 Companies are really good about being able to tailor that 0:12:19.240 --> 0:12:22.440 to the conditions. But we do have crisis, and nobody 0:12:22.480 --> 0:12:25.679 can really predict crises very well, or at least the 0:12:25.760 --> 0:12:29.720 timing of them. They may see them coming. So that's 0:12:29.760 --> 0:12:31.240 what I think the economy does. 0:12:31.200 --> 0:12:34.320 Now, right, all right, Kim, thanks so much for joining us. 0:12:34.320 --> 0:12:36.480 Really appreciated as always, Kim Farish. 0:12:36.520 --> 0:12:39.760 She's a founder and chief investment officer Boca Capital Partners 0:12:40.480 --> 0:12:43.240 in from Pittsburgh, PA, one of my favorite towns. 0:12:44.640 --> 0:12:48.480 You're listening to the Bloomberg Intelligence Podcast. Catch us live 0:12:48.600 --> 0:12:50.440 weekdays at ten am Eastern. 0:12:50.160 --> 0:12:52.720 On Apple car Playing and Broun Auto with the Bloomberg 0:12:52.800 --> 0:12:53.400 Business app. 0:12:53.480 --> 0:12:56.640 Listen on demand wherever you get your podcasts, or watch 0:12:56.760 --> 0:12:58.000 us live on YouTube. 0:13:00.160 --> 0:13:03.319 Today, Signia Group said it won't pursue a combination with 0:13:03.520 --> 0:13:08.040 rival Ensure Humana after reports two companies had renewed discussions. 0:13:08.080 --> 0:13:10.520 Signa shares jump by eight point seven at the New 0:13:10.600 --> 0:13:13.240 York market open, while shares in Humanity dropped by six percent, 0:13:13.320 --> 0:13:17.040 So not so much here for this particular deal. 0:13:17.559 --> 0:13:19.120 Glenn Losev Joints is. 0:13:19.120 --> 0:13:21.760 He's a senior Equiano's covering a healthcare services space for 0:13:22.360 --> 0:13:25.440 Bloomberg Intelligency Joints was here in a New York Bloomberg 0:13:25.480 --> 0:13:28.839 Interactive Brokers studio in New York. So Glenn talk to 0:13:28.960 --> 0:13:32.080 us about this deal that did not happen between Signa 0:13:32.240 --> 0:13:32.840 and Humana. 0:13:34.320 --> 0:13:37.520 Yes, so this is the second try. If it wasn't 0:13:37.559 --> 0:13:42.320 the rumor the first time the companies tried to merge 0:13:42.800 --> 0:13:47.079 at the end of last year, it also didn't take 0:13:47.160 --> 0:13:53.480 long to sort of to fall apart. This was the 0:13:53.600 --> 0:13:58.280 last the second time, and you know, we don't exactly 0:13:58.400 --> 0:14:02.439 know what happened, but my view was that the the 0:14:02.600 --> 0:14:09.000 takeout price for Humana the companies will not agree upon, 0:14:09.200 --> 0:14:15.320 and that's probably the reason over the last eleven month 0:14:15.600 --> 0:14:19.720 Humana lost half of its market cap. You know, it's 0:14:19.840 --> 0:14:23.280 very difficult. Obviously Signa is a much better place to 0:14:23.880 --> 0:14:26.760 to sort of to pitch the merger, but also when 0:14:26.800 --> 0:14:30.320 you were trading it twice the market cap just a 0:14:30.400 --> 0:14:33.800 few months ago, you know, it's difficult to agree on 0:14:33.920 --> 0:14:35.160 price and they. 0:14:35.120 --> 0:14:38.680 Couldn't really adjust that at this stage, you know, with 0:14:39.720 --> 0:14:43.200 with Humanis stock now having dropped so much in the meantime, That's. 0:14:43.040 --> 0:14:45.440 What I'm thinking. This is it wasn't confirmed. The only 0:14:45.520 --> 0:14:48.960 thing that Signa said that they're not pursuing the merger, 0:14:50.000 --> 0:14:53.840 but price is probably the reason for it, the agreement 0:14:53.920 --> 0:14:54.400 and the price. 0:14:54.440 --> 0:14:54.920 All right, so. 0:14:56.400 --> 0:15:03.040 Is insurance company? Yes, Humana is a healthcare services provider. 0:15:03.240 --> 0:15:07.760 No, so, Signa and Humana are both health insurance insurance. 0:15:08.120 --> 0:15:12.640 Signa has a huge pharmaceutical benefit manager express Script. If 0:15:12.680 --> 0:15:14.920 you remember they are a few years ago, it's one 0:15:15.000 --> 0:15:19.400 of the top three human and and also seeing that 0:15:19.680 --> 0:15:25.480 focuses more on the commercial business, which is employer employer 0:15:25.880 --> 0:15:30.520 based UH insurance, while Humana is focusing on medicare people 0:15:30.560 --> 0:15:31.880 who are over sixty five? 0:15:32.280 --> 0:15:32.640 Got it? 0:15:33.320 --> 0:15:35.480 And you got to think now, like Signa's sack up 0:15:35.520 --> 0:15:38.440 a good bit today. They've done a lot of share buybacks. 0:15:38.600 --> 0:15:40.600 Would think that that's going to be now the strategy 0:15:40.680 --> 0:15:44.080 going forward back to those Yeah, again, what else do 0:15:44.120 --> 0:15:45.600 you do when you're not about to spend a couple 0:15:45.640 --> 0:15:47.360 billion dollars on another company? 0:15:48.160 --> 0:15:53.440 You you basically yeah, but you're basically they're they're they're 0:15:53.480 --> 0:15:59.560 expanding their UH sort of expanding their pharmacy business UH 0:16:00.040 --> 0:16:03.800 part of the express Script. That's where the tailwans are 0:16:04.000 --> 0:16:08.400 over the next few years, and just stugging along trying 0:16:08.480 --> 0:16:12.880 to you know, cut costs and improve revenue. That's basically 0:16:12.960 --> 0:16:13.760 the business model. 0:16:13.840 --> 0:16:14.160 All right. 0:16:14.280 --> 0:16:17.760 So healthcare investors, they woke up Wednesday morning last week, 0:16:19.120 --> 0:16:22.040 what did the election mean for the health care space? 0:16:22.320 --> 0:16:25.520 So for healthcare space, it's very broad. But for example, 0:16:25.560 --> 0:16:31.840 for health insurance, basically it's Trump's win is positive for 0:16:31.960 --> 0:16:36.120 Medicare advantage companies rule of time sort of like Humana, 0:16:36.800 --> 0:16:43.480 And there's an overhang of for Medicaid insurance companies like 0:16:43.600 --> 0:16:48.280 Stina and Malina because of the work requirements, possibilities and 0:16:48.400 --> 0:16:53.960 about my care, about my care subsidies expiring at the 0:16:54.080 --> 0:16:55.840 end of the end of the. 0:16:57.640 --> 0:17:01.280 Four His presidency is also obviously positive for m and A. 0:17:01.600 --> 0:17:04.560 Any chance that you know, this deal gets revisited again 0:17:04.760 --> 0:17:06.920 or SIGNA maybe has another target. 0:17:06.960 --> 0:17:10.359 There is always a chance for this deal to be 0:17:10.480 --> 0:17:11.320 revisited again. 0:17:11.600 --> 0:17:13.760 We got to give Paul a chance to live out 0:17:13.840 --> 0:17:16.200 his stream here being a healthcare of an a banker. 0:17:16.560 --> 0:17:16.720 Right. 0:17:17.040 --> 0:17:26.639 Over All, overall, managed care industry is facing headwinds. You know, 0:17:26.800 --> 0:17:31.560 costs are going up government that is through the roof, 0:17:32.000 --> 0:17:34.040 so they're not going to get paid as much as 0:17:34.080 --> 0:17:39.200 they did five years ago, so it's a marching contraction possibility, 0:17:39.960 --> 0:17:45.720 so you know, buying another health insurance companies always benefit 0:17:46.280 --> 0:17:49.520 for help for insurance business. Any insurance business. Scale is 0:17:49.600 --> 0:17:53.359 the king for any type of insurance business. So there's 0:17:53.400 --> 0:17:56.600 certainly possibility that they will revisit and maybe a gree 0:17:56.640 --> 0:17:57.480 on the price this time. 0:17:57.760 --> 0:17:59.639 All right, Glennlassa, thank you so much for joining us. 0:17:59.640 --> 0:18:02.560 Glenlaw so he's a senior ecoanas covering the healthcare services 0:18:02.640 --> 0:18:06.520 businesses for Bloomberg Intelligence. You can get his research by 0:18:06.560 --> 0:18:09.119 going b I go on the terminal and then you 0:18:09.160 --> 0:18:11.040 can go down to the healthcare stuff and we got 0:18:11.119 --> 0:18:13.720 it all covered on a global scale. 0:18:14.440 --> 0:18:15.919 So we appreciate gating a few minutes of this time. 0:18:15.960 --> 0:18:17.679 A deal, I guess not happening in. 0:18:17.680 --> 0:18:20.240 The healthcare space, so you'll have to look for another one. 0:18:20.480 --> 0:18:21.160 Yeah, exactly. 0:18:21.680 --> 0:18:23.320 But again it just seems like if a lot of 0:18:23.359 --> 0:18:25.000 these big farmer companies that they can't come up with 0:18:25.080 --> 0:18:26.720 whatever they need to come up with through their R 0:18:26.720 --> 0:18:28.439 and D, they just got to just go on. 0:18:28.440 --> 0:18:28.720 And buy it. 0:18:28.800 --> 0:18:31.080 Yeah, if it's not organic, you know exactly right. 0:18:32.600 --> 0:18:36.440 You're listening to the Bloomberg Intelligence podcast. Catch us live 0:18:36.560 --> 0:18:39.480 weekdays at ten am Eastern on applecar. 0:18:39.119 --> 0:18:41.560 Play and Android Auto with the Bloomberg Business. 0:18:42.000 --> 0:18:44.800 You can also listen live on Amazon Alexa from our 0:18:44.840 --> 0:18:49.200 flagship New York station Just Say Alexa playing Bloomberg eleven thirty. 0:18:50.800 --> 0:18:53.160 All right, Molly Smith sitting in for Alex Steele Paul 0:18:53.200 --> 0:18:55.240 Swhen you were live here in our Bloomberg Interactive Brokers 0:18:55.280 --> 0:18:58.320 studio streaming live on YouTube as well, So go over 0:18:58.320 --> 0:19:00.440 there and check us out. You can search Bloomberg Podcast 0:19:00.480 --> 0:19:02.720 and that's where you will find it. A lot of 0:19:02.840 --> 0:19:06.359 questions being asked by market participants about some of the 0:19:06.440 --> 0:19:08.600 policies that we may see coming out of President like 0:19:08.720 --> 0:19:13.199 Trump's second stint in the White House. David Young joins us. 0:19:13.640 --> 0:19:17.480 He's a president the Public Policy Center at the Conference Board. David, 0:19:17.480 --> 0:19:19.440 thanks so much for joining us here. What are the 0:19:19.560 --> 0:19:24.000 key areas you're looking for or looking at with a 0:19:24.320 --> 0:19:27.879 Republican in the White House, a Republican Senate, and potentially 0:19:28.680 --> 0:19:31.520 a Republican House, how do you think we'll see policy 0:19:31.640 --> 0:19:33.080 ramifications stem from that? 0:19:34.200 --> 0:19:36.480 Yeah? Well, good morning, and thank you again for having 0:19:36.560 --> 0:19:36.720 me on. 0:19:36.800 --> 0:19:39.800 I found the conversation before very interesting and also just 0:19:39.880 --> 0:19:42.160 a side note, as a former division one tennis player 0:19:42.680 --> 0:19:47.320 unfortunately was not six foot one to six three. That 0:19:47.520 --> 0:19:51.159 profession was short lived. But yeah, when we're looking at 0:19:51.240 --> 0:19:56.760 top kind of you know, the initial priorities from a 0:19:57.160 --> 0:20:01.200 Trump two point zero administration, I think the one that 0:20:01.400 --> 0:20:03.960 is talked about most, and you guys were talking about 0:20:03.960 --> 0:20:08.080 it earlier is tariffs. Obviously you guys mentioned this. You know, 0:20:08.160 --> 0:20:12.240 there's this ten plus so ten to twenty percent universal 0:20:13.840 --> 0:20:16.320 tariff that Trump has talked about, but then also the 0:20:16.400 --> 0:20:20.840 sixty percent tariff on China. I think it's also important 0:20:20.880 --> 0:20:23.439 to just mention when we talk about tariffs here there 0:20:23.520 --> 0:20:27.920 is also a direct correlation towards trade, and when we 0:20:28.000 --> 0:20:30.879 start talking about trade, we start talking about trade agreements. 0:20:31.000 --> 0:20:34.600 So upcoming next year will be the renewal should any 0:20:34.640 --> 0:20:38.679 of the three countries, Canada, the US, or Mexico require it, a. 0:20:39.359 --> 0:20:41.920 Renewal or refresh of the US. 0:20:41.840 --> 0:20:46.159 MCA, which I think will have some pretty significant ramifications, 0:20:47.200 --> 0:20:52.680 especially given the role and relationship between Mexico and Canada. 0:20:52.760 --> 0:20:57.040 I describe Mexico increasingly as one of those connector economies, 0:20:58.000 --> 0:21:01.560 so goods come from China Mexico then up through the US. 0:21:01.560 --> 0:21:03.760 So it will be really interesting to see what Trump 0:21:03.920 --> 0:21:07.080