1 00:00:00,080 --> 00:00:06,760 Speaker 1: Bloomberg Audio Studios, Podcasts, radio News. 2 00:00:11,960 --> 00:00:15,560 Speaker 2: This is the Bloomberg Surveillance Podcast. I'm Tom Keene along 3 00:00:15,600 --> 00:00:18,960 Speaker 2: with Paul Sweeney. Join us each day for insight from 4 00:00:18,960 --> 00:00:23,160 Speaker 2: the best in economics, finance, investment, and international relations. You 5 00:00:23,160 --> 00:00:26,520 Speaker 2: can also watch the show live on YouTube. Visit the 6 00:00:26,520 --> 00:00:31,280 Speaker 2: Bloomberg Podcast channel on YouTube to see the show weekday 7 00:00:31,280 --> 00:00:34,320 Speaker 2: mornings from seven to ten am Eastern from our global 8 00:00:34,360 --> 00:00:39,000 Speaker 2: headquarters in New York City. Subscribe to the podcast on Apple, Spotify, 9 00:00:39,360 --> 00:00:42,920 Speaker 2: or anywhere else you listen and always I'm Bloomberg Radio, 10 00:00:43,080 --> 00:00:47,360 Speaker 2: the Bloomberg Terminal, and the Bloomberg Business App. Joining us 11 00:00:47,400 --> 00:00:51,360 Speaker 2: Stats Kim Dawson, New Edge Wealth. Who you know, people 12 00:00:51,400 --> 00:00:53,600 Speaker 2: make jokes about it, but there's strategists that have a 13 00:00:53,680 --> 00:00:56,440 Speaker 2: conviction in the market. Kim Dawson, I think the bears 14 00:00:57,040 --> 00:01:01,000 Speaker 2: percolated this weekend off the calendar and said, OMG, now's 15 00:01:01,040 --> 00:01:03,640 Speaker 2: the time to get out. Why are you still in the. 16 00:01:03,520 --> 00:01:07,039 Speaker 1: Market because the trend is still up, momentum is positive, 17 00:01:07,080 --> 00:01:08,600 Speaker 1: and liquidity is supportive. 18 00:01:09,200 --> 00:01:10,080 Speaker 3: I think that we. 19 00:01:10,200 --> 00:01:13,600 Speaker 1: Are very attuned to the brewing risks, meaning that for 20 00:01:13,640 --> 00:01:16,640 Speaker 1: the first time in twelve months, you saw GDP forecast 21 00:01:16,680 --> 00:01:17,840 Speaker 1: get cut on Friday. 22 00:01:18,200 --> 00:01:18,960 Speaker 3: That's significant. 23 00:01:18,959 --> 00:01:19,640 Speaker 4: I was on a beache. 24 00:01:20,280 --> 00:01:22,840 Speaker 1: So for the last eighteen months, we've been seeing a 25 00:01:23,000 --> 00:01:26,120 Speaker 1: rising growth forecast environment, which has been really good for 26 00:01:26,280 --> 00:01:30,440 Speaker 1: risk assets. It's allowed valuations to continue to expand, EPs 27 00:01:30,560 --> 00:01:33,720 Speaker 1: estimates to continue to drift higher. If that starts to 28 00:01:33,840 --> 00:01:36,720 Speaker 1: change in a more meaningful way, then we would grow 29 00:01:36,760 --> 00:01:40,240 Speaker 1: more cautious. But really it's a matter of balancing the 30 00:01:40,280 --> 00:01:42,840 Speaker 1: fact that you still have this positive trend with some 31 00:01:43,000 --> 00:01:44,200 Speaker 1: of these brewing risks. 32 00:01:44,760 --> 00:01:47,400 Speaker 4: You know, Torsten Slock was out with a good note 33 00:01:47,440 --> 00:01:49,200 Speaker 4: in the last couple of days, our good friend over 34 00:01:49,200 --> 00:01:51,480 Speaker 4: at Apollo. The top ten companies in the S and 35 00:01:51,520 --> 00:01:54,040 Speaker 4: P five hundred makeup thirty five percent of the market cap, 36 00:01:54,280 --> 00:01:57,120 Speaker 4: but only twenty three percent of the earnings. Talking about 37 00:01:57,160 --> 00:02:00,560 Speaker 4: that concentration risk in the market, how much of a 38 00:02:00,640 --> 00:02:03,040 Speaker 4: risk is that for you if an Nvidia or somebody 39 00:02:03,040 --> 00:02:06,680 Speaker 4: else really just really disappoint somewhere along the line. 40 00:02:06,960 --> 00:02:09,160 Speaker 1: One of the phrases that we keep repeating is that 41 00:02:09,400 --> 00:02:11,760 Speaker 1: trees can grow a lot longer than you think, but 42 00:02:11,880 --> 00:02:15,840 Speaker 1: they usually stop short of the sky, meaning that eventually 43 00:02:16,040 --> 00:02:18,120 Speaker 1: you're going to have a challenge where you will have 44 00:02:18,280 --> 00:02:21,480 Speaker 1: priced all of these unending growth parts of the market 45 00:02:21,600 --> 00:02:25,320 Speaker 1: at such lofty valuations that even if they deliver growth, 46 00:02:25,400 --> 00:02:27,880 Speaker 1: you will see an unwind in the valuation. The problem 47 00:02:28,000 --> 00:02:31,760 Speaker 1: is you need a catalyst and you need earnings to 48 00:02:31,800 --> 00:02:32,919 Speaker 1: stop going up. 49 00:02:33,680 --> 00:02:38,400 Speaker 2: What's important, your folks, is cam Dawson brings bulletproof mathematics 50 00:02:38,440 --> 00:02:41,640 Speaker 2: to this. She's not just spouting paragraphs. Do you have 51 00:02:41,680 --> 00:02:44,880 Speaker 2: a discount of cash flow model or some form of 52 00:02:44,919 --> 00:02:48,000 Speaker 2: net present value study that allows you to stay in 53 00:02:48,040 --> 00:02:49,880 Speaker 2: the market? How do you get there? 54 00:02:50,800 --> 00:02:53,200 Speaker 1: I will say that we are in very rarefied air 55 00:02:53,280 --> 00:02:57,040 Speaker 1: for valuations, and so if you're just looking at fundamentals, 56 00:02:57,080 --> 00:02:59,200 Speaker 1: what you have to acknowledge is that you're back up 57 00:02:59,200 --> 00:03:02,600 Speaker 1: to twenty twenty twenty twenty one levels of valuations. So 58 00:03:02,639 --> 00:03:05,800 Speaker 1: if you do a DCF, you would argue that focussally 59 00:03:05,840 --> 00:03:06,359 Speaker 1: we are over. 60 00:03:06,760 --> 00:03:10,520 Speaker 2: You slam your terminal value more present and put extra 61 00:03:10,600 --> 00:03:15,040 Speaker 2: weight on quarterly and annual free cash flow assumptions. That 62 00:03:15,120 --> 00:03:16,600 Speaker 2: seems to be the rationalization. 63 00:03:17,080 --> 00:03:19,680 Speaker 1: Look, every time you try to say this time is different, 64 00:03:19,720 --> 00:03:22,560 Speaker 1: that's usually when you run headfirst into a market peak. 65 00:03:22,960 --> 00:03:25,399 Speaker 3: Go back to December of twenty twenty one. 66 00:03:25,800 --> 00:03:28,799 Speaker 1: Robert Schiller came out and said, don't worry about high 67 00:03:28,880 --> 00:03:32,160 Speaker 1: valuations because interest rates are so low. We ended up 68 00:03:32,160 --> 00:03:34,640 Speaker 1: being in a bubble for both equities and for bonds, 69 00:03:34,639 --> 00:03:36,800 Speaker 1: and that's twenty two was a bad year. I think 70 00:03:36,800 --> 00:03:40,760 Speaker 1: that that discipline about valuation needs to be very, very present, 71 00:03:40,800 --> 00:03:44,000 Speaker 1: which just means we're not chasing growth stocks at this time. 72 00:03:44,040 --> 00:03:46,480 Speaker 1: And if we're looking within the growth index, we're looking 73 00:03:46,480 --> 00:03:48,840 Speaker 1: at names that are trading at a discount to the index. 74 00:03:49,760 --> 00:03:50,600 Speaker 5: Where do I go here? 75 00:03:50,720 --> 00:03:55,960 Speaker 4: I'm afraid of tech stocks? Do I go, financials, energy industrials? 76 00:03:56,560 --> 00:03:57,720 Speaker 4: Where does a normal person go? 77 00:03:58,600 --> 00:04:01,560 Speaker 1: I think that there are plenty of opportunities outside of 78 00:04:01,600 --> 00:04:04,520 Speaker 1: the megacap stocks, but you have to be highly selective, 79 00:04:04,760 --> 00:04:06,840 Speaker 1: which means that we don't think that you should be 80 00:04:06,920 --> 00:04:10,600 Speaker 1: indexing your value your international or your small cap. Meaning 81 00:04:11,000 --> 00:04:15,440 Speaker 1: active management is absolutely imperative because there's a big divergence 82 00:04:15,480 --> 00:04:17,960 Speaker 1: between the winners and the losers in that space. And 83 00:04:18,040 --> 00:04:19,960 Speaker 1: so if you can look at names with high free 84 00:04:20,000 --> 00:04:23,320 Speaker 1: cash flows, strong return at invested capital, good growing dividends, 85 00:04:23,600 --> 00:04:25,919 Speaker 1: all the things that we love as long term investors, 86 00:04:26,160 --> 00:04:28,640 Speaker 1: you weed out the strength from the weakness, and that's 87 00:04:28,640 --> 00:04:29,880 Speaker 1: where you can cut value, and. 88 00:04:29,920 --> 00:04:32,720 Speaker 2: The textbook will say, out of one hundred stocks, thirty 89 00:04:32,760 --> 00:04:36,040 Speaker 2: have strength, seventy have weakness. How do you find a 90 00:04:36,160 --> 00:04:37,839 Speaker 2: seventy percent you don't want to own? 91 00:04:38,080 --> 00:04:41,520 Speaker 1: Yeah, well, it's a combination of the fundamentals and then 92 00:04:41,640 --> 00:04:44,320 Speaker 1: that discipline around the technicals, which is that what we 93 00:04:44,400 --> 00:04:46,920 Speaker 1: do is we screen up names that do have high debt, 94 00:04:47,080 --> 00:04:49,960 Speaker 1: meaning that they rely on capital markets just to keep 95 00:04:50,000 --> 00:04:52,320 Speaker 1: the lights on. We screen up names that have really 96 00:04:52,440 --> 00:04:54,080 Speaker 1: volatile free cash flow generation. 97 00:04:54,240 --> 00:04:55,680 Speaker 3: We want stability in that. 98 00:04:56,040 --> 00:04:58,559 Speaker 1: And then what we're trying to identify is those names 99 00:04:58,600 --> 00:05:02,159 Speaker 1: that have high roc return on invested capital. Every dollar 100 00:05:02,160 --> 00:05:04,760 Speaker 1: they put into the business they generate more out. That 101 00:05:04,800 --> 00:05:07,120 Speaker 1: doesn't mean you get the stocks right at every moment, 102 00:05:07,520 --> 00:05:09,719 Speaker 1: because a lot of those names are still being left 103 00:05:09,760 --> 00:05:12,400 Speaker 1: behind in this extraordinarily narrow market. 104 00:05:12,520 --> 00:05:15,200 Speaker 4: What we reminded, I guess Thursday night into Friday, is 105 00:05:15,320 --> 00:05:18,680 Speaker 4: this is an election year and there's election political risk 106 00:05:18,720 --> 00:05:20,920 Speaker 4: in the marketplace. When you talk to your clients, how 107 00:05:20,920 --> 00:05:22,760 Speaker 4: do you talk to them about what could be a 108 00:05:22,800 --> 00:05:25,640 Speaker 4: volatile time on the political front over the next six months. 109 00:05:25,920 --> 00:05:28,880 Speaker 1: I think we have to first identify what neither party 110 00:05:29,000 --> 00:05:32,240 Speaker 1: is talking about, which is balance budgets in austerity. So 111 00:05:32,640 --> 00:05:36,200 Speaker 1: no matter what party you affiliate with, you have to 112 00:05:36,240 --> 00:05:40,000 Speaker 1: acknowledge that both parties are going to probably contribute to 113 00:05:40,080 --> 00:05:43,080 Speaker 1: higher deficits, which just means that the bond market is 114 00:05:43,120 --> 00:05:44,560 Speaker 1: going to have to continue to. 115 00:05:44,600 --> 00:05:46,880 Speaker 3: Digest this higher issuance of treasuries. 116 00:05:47,160 --> 00:05:50,240 Speaker 1: That could mean a step you'll curve through a bear steepening, 117 00:05:50,640 --> 00:05:52,960 Speaker 1: and it could mean this continued drift higher in the 118 00:05:53,000 --> 00:05:53,760 Speaker 1: long end of the curve. 119 00:05:54,040 --> 00:05:57,400 Speaker 2: Let me double use of cash here. It's real simple 120 00:05:57,640 --> 00:06:02,080 Speaker 2: use of cash, share buy back, gibbling growth. And I'd 121 00:06:02,120 --> 00:06:06,080 Speaker 2: compound with that the nascon idea that big tech and 122 00:06:06,160 --> 00:06:10,440 Speaker 2: other companies frankly will issue more bonds. Am I onto 123 00:06:10,480 --> 00:06:11,159 Speaker 2: something there? 124 00:06:12,440 --> 00:06:13,520 Speaker 3: They don't do they need to. 125 00:06:13,720 --> 00:06:15,880 Speaker 2: I think they don't need to. That's precisely the point. 126 00:06:15,920 --> 00:06:18,800 Speaker 2: But you do it and you retire stock. I mean, 127 00:06:18,839 --> 00:06:21,560 Speaker 2: that's the big It's Mario Gabelli one on one. 128 00:06:21,680 --> 00:06:25,760 Speaker 1: Yeah, I think that the calculus for using debt in 129 00:06:25,839 --> 00:06:29,760 Speaker 1: order to do share repurchases is less attractive at today's rates. 130 00:06:29,800 --> 00:06:33,560 Speaker 1: But to your point, credit spreads are also extraordinarily tight, 131 00:06:33,680 --> 00:06:36,240 Speaker 1: so you could take advantage of say, yes, my base 132 00:06:36,279 --> 00:06:39,800 Speaker 1: yield is higher, but nobody really is demanding extra compensation 133 00:06:39,880 --> 00:06:40,640 Speaker 1: for credit risk. 134 00:06:40,960 --> 00:06:43,320 Speaker 3: The triple B to double B spread is. 135 00:06:43,279 --> 00:06:46,440 Speaker 1: Actually tighter today than it was in twenty twenty one, 136 00:06:46,920 --> 00:06:49,800 Speaker 1: showing just how price per perfection the credit market is. 137 00:06:49,960 --> 00:06:51,920 Speaker 2: I mean, right right there, I think, Paul, that's the 138 00:06:52,000 --> 00:06:53,760 Speaker 2: quote of the day here is the bond market is 139 00:06:53,760 --> 00:06:56,320 Speaker 2: telling the equity market what to do. The most important 140 00:06:56,320 --> 00:06:58,599 Speaker 2: thing that happened last quarter was at home Depot Yep, 141 00:06:58,680 --> 00:07:01,200 Speaker 2: they had a bond offering. Was a four foot starts. Yeah, 142 00:07:01,960 --> 00:07:02,200 Speaker 2: that's the. 143 00:07:02,279 --> 00:07:05,880 Speaker 4: Most important exactly the last quarter. What are you guys 144 00:07:05,880 --> 00:07:09,400 Speaker 4: thinking about our feed of reserve here this year? When, if, when? 145 00:07:09,840 --> 00:07:12,000 Speaker 4: How many times? What are you guys factoring in? 146 00:07:12,280 --> 00:07:14,240 Speaker 1: I think that the Fed is far more balanced, and 147 00:07:14,280 --> 00:07:16,600 Speaker 1: this is their words, We're more balanced in the risks 148 00:07:16,640 --> 00:07:20,800 Speaker 1: between unemployment going up and inflation going up, meaning that 149 00:07:21,280 --> 00:07:24,000 Speaker 1: they are growing more concerned about some of this fraying 150 00:07:24,000 --> 00:07:26,560 Speaker 1: in the labor market. We are already at their four 151 00:07:26,560 --> 00:07:30,360 Speaker 1: point two four point zero percent target for unemployment this year, 152 00:07:30,600 --> 00:07:33,080 Speaker 1: which just means that if we creep higher into that 153 00:07:33,120 --> 00:07:36,160 Speaker 1: four point two zone, it could be the room for 154 00:07:36,240 --> 00:07:37,560 Speaker 1: them to be able to cut. 155 00:07:37,400 --> 00:07:39,280 Speaker 2: We're got to rip up the scripture, sure on it. 156 00:07:39,400 --> 00:07:42,640 Speaker 2: I mean, YouTube's on fire. There's a there's a woman 157 00:07:42,720 --> 00:07:45,320 Speaker 2: or guy here, I don't know which, and their daughter's 158 00:07:45,400 --> 00:07:49,400 Speaker 2: watching you right now, and the daughter wants to be you. 159 00:07:50,120 --> 00:07:53,680 Speaker 2: How did you get into the academics of finance? How 160 00:07:53,680 --> 00:07:55,400 Speaker 2: did you get so damn smart? 161 00:07:55,440 --> 00:07:59,440 Speaker 1: Down in Florida, Down in Florida, the caveat look. I 162 00:07:59,440 --> 00:08:02,200 Speaker 1: think read a lot of books, be a voracious reader, 163 00:08:02,480 --> 00:08:05,200 Speaker 1: and I think that the study of economics is the 164 00:08:05,200 --> 00:08:07,560 Speaker 1: most beautiful study in a liberal arts education. 165 00:08:08,040 --> 00:08:10,320 Speaker 3: You get mac theology book. 166 00:08:10,400 --> 00:08:12,800 Speaker 4: I just told my nineteen year old that yesterday. 167 00:08:12,960 --> 00:08:15,800 Speaker 2: What's the number one investment book that changed your life? 168 00:08:15,880 --> 00:08:18,000 Speaker 2: I know mine, but you know what was the one 169 00:08:18,160 --> 00:08:21,440 Speaker 2: where you said, hey, this is interesting. Yeah, no, not 170 00:08:21,480 --> 00:08:24,200 Speaker 2: flying on one engine? What was the book? What was 171 00:08:24,240 --> 00:08:27,120 Speaker 2: the book that you know? You're seventeen, eighteen years old 172 00:08:27,360 --> 00:08:29,000 Speaker 2: and it was an investment book. Yeah. 173 00:08:29,080 --> 00:08:32,800 Speaker 1: I think More Money than God is a fantastic book, 174 00:08:32,800 --> 00:08:35,720 Speaker 1: sabashed Malaby about some of the great hedge fund investors. 175 00:08:36,200 --> 00:08:41,280 Speaker 1: I think that books like Austerity, which is a fantastic 176 00:08:41,280 --> 00:08:45,640 Speaker 1: book about politics and economics coming out of the year. 177 00:08:45,760 --> 00:08:48,679 Speaker 2: For me, it was against the Gods. Peter Burnstein, you know, on. 178 00:08:48,720 --> 00:08:51,880 Speaker 3: Risk and uncertainty, Wealth born Wisdom, Martin Biggs. 179 00:08:52,240 --> 00:08:57,240 Speaker 1: Yeah, absolutely fascinating, talking about seeing through volatility essential reads. 180 00:08:57,320 --> 00:08:58,679 Speaker 2: We're going to rip up the script. We're going to 181 00:08:58,720 --> 00:09:02,000 Speaker 2: put this on single best Idea today with Kim Dawson. Here. 182 00:09:02,120 --> 00:09:03,720 Speaker 2: This is how you do it, folks. You got to 183 00:09:03,720 --> 00:09:06,400 Speaker 2: get kids interested in this. You throw the book at 184 00:09:06,440 --> 00:09:09,480 Speaker 2: them and say no TikTok till you read the book 185 00:09:09,480 --> 00:09:23,880 Speaker 2: that Kim Dawson says to read. Right now, we're going 186 00:09:23,920 --> 00:09:28,079 Speaker 2: to migrate to the bond market and gauge. Here the 187 00:09:28,080 --> 00:09:35,840 Speaker 2: coupon the side joins us right now with Franklin Templeton. 188 00:09:36,200 --> 00:09:39,839 Speaker 2: So you're managing for coupon or can you actually give 189 00:09:39,880 --> 00:09:40,840 Speaker 2: me total return? 190 00:09:42,200 --> 00:09:44,560 Speaker 5: So you know, this year, I think total return and 191 00:09:44,600 --> 00:09:47,720 Speaker 5: maybe for a while total return is not looking fabulous 192 00:09:47,760 --> 00:09:50,040 Speaker 5: it is for coupon. I think we're getting to a 193 00:09:50,080 --> 00:09:54,760 Speaker 5: stage where, just if you're just looking at high quality bonds, 194 00:09:54,800 --> 00:09:58,600 Speaker 5: spreads are really coming so much in all the spread sectors, 195 00:09:59,240 --> 00:10:02,960 Speaker 5: and if I I look at I actually see them 196 00:10:03,000 --> 00:10:08,200 Speaker 5: as being pretty fair where they are between we've been 197 00:10:08,320 --> 00:10:10,600 Speaker 5: I've been calling for four twenty five to four seventy 198 00:10:10,600 --> 00:10:13,880 Speaker 5: five most of this year, and I have no reason 199 00:10:13,920 --> 00:10:15,520 Speaker 5: to really alter that very much. 200 00:10:15,679 --> 00:10:18,280 Speaker 2: Kathy Jones with us earlier was Schwaba. She just puts 201 00:10:18,280 --> 00:10:21,920 Speaker 2: out on Twitter an amazing chart and this is something 202 00:10:21,960 --> 00:10:25,320 Speaker 2: I don't look at, Paul, but it's basically ten or 203 00:10:25,360 --> 00:10:30,959 Speaker 2: fifteen bond categories, bank loans, all the stuff Franklin Templeton does, Paul, 204 00:10:31,400 --> 00:10:33,120 Speaker 2: I would have done better in cash. 205 00:10:33,600 --> 00:10:33,800 Speaker 5: I know. 206 00:10:34,040 --> 00:10:36,880 Speaker 2: That's what that's the challenge, exactly. All right. 207 00:10:36,920 --> 00:10:39,480 Speaker 4: So now so in honor of Joe Mysak, who is 208 00:10:39,800 --> 00:10:42,160 Speaker 4: enjoying his first day of retirement today, the Dean of 209 00:10:42,280 --> 00:10:46,280 Speaker 4: municipal Reporters out there talking about the municipal bond market. 210 00:10:46,320 --> 00:10:49,920 Speaker 4: I think I can get some really attractive tax equivalent 211 00:10:50,080 --> 00:10:52,720 Speaker 4: yields out there. How do you view the municial bond market? 212 00:10:52,800 --> 00:10:56,000 Speaker 5: We do like it. We like the municipal market. We 213 00:10:56,080 --> 00:10:58,800 Speaker 5: think technicals are favorable. You know, it was very out 214 00:10:58,800 --> 00:11:02,120 Speaker 5: of favor for most of law Stier enormously so, and 215 00:11:02,240 --> 00:11:04,160 Speaker 5: this year it is coming back and it is one 216 00:11:04,200 --> 00:11:08,400 Speaker 5: of the areas which we like. We think Actually, you know, 217 00:11:08,520 --> 00:11:10,600 Speaker 5: to go back to what you and Tom are just saying, 218 00:11:10,840 --> 00:11:12,800 Speaker 5: you could have done better in cash. This is true, yer, 219 00:11:13,160 --> 00:11:15,800 Speaker 5: but you can't stay in cash. That's the risk, because 220 00:11:15,840 --> 00:11:18,760 Speaker 5: you've got to start dipping your feedback into the bond market. 221 00:11:19,200 --> 00:11:21,880 Speaker 5: My advice would be at least go out for short 222 00:11:22,000 --> 00:11:25,160 Speaker 5: before you before you take the deep dive, because when 223 00:11:25,240 --> 00:11:27,760 Speaker 5: the time comes, you won't always have the yields which 224 00:11:27,800 --> 00:11:30,800 Speaker 5: you currently have now. Total return is something we've gotten 225 00:11:30,880 --> 00:11:33,240 Speaker 5: very used to over the last twenty years of easy 226 00:11:33,280 --> 00:11:36,320 Speaker 5: money and liquidity. But I don't think that that's what. 227 00:11:37,040 --> 00:11:40,240 Speaker 5: That's not where the bond market necessarily is going to 228 00:11:40,280 --> 00:11:43,880 Speaker 5: take us over the next several years. It's going to 229 00:11:43,880 --> 00:11:45,800 Speaker 5: do what it says on the can. It's going to 230 00:11:45,800 --> 00:11:49,320 Speaker 5: deliver a certain amount of income, ideally with less volatility 231 00:11:49,360 --> 00:11:52,720 Speaker 5: than we're seeing right now, as markets adjust to what 232 00:11:52,840 --> 00:11:57,640 Speaker 5: I think is the new state, the new state, which 233 00:11:57,679 --> 00:11:59,920 Speaker 5: is a lot like the old state, which was from 234 00:12:00,120 --> 00:12:04,079 Speaker 5: nineteen fifties until the global financial crisis. You know, bonds 235 00:12:04,120 --> 00:12:07,640 Speaker 5: delivered decent returns, but not equity like returns. 236 00:12:07,960 --> 00:12:11,000 Speaker 4: I'm looking at the Bloomberg US corporate high yield total 237 00:12:11,040 --> 00:12:14,400 Speaker 4: return indext positive two point five to eight percent year 238 00:12:14,440 --> 00:12:16,600 Speaker 4: to date high yield. 239 00:12:16,679 --> 00:12:19,080 Speaker 3: That's your thoughts there, So high yeld. 240 00:12:19,559 --> 00:12:21,719 Speaker 5: Here's the thing that high yield I think, you know 241 00:12:21,880 --> 00:12:24,600 Speaker 5: if you manage it actively, So not buying the index, 242 00:12:24,720 --> 00:12:29,520 Speaker 5: high yield can actually deliver a decent return, but once again, 243 00:12:29,640 --> 00:12:33,120 Speaker 5: what you're really looking at is the overall yield that 244 00:12:33,160 --> 00:12:36,160 Speaker 5: you're getting from it, and what you're getting in total 245 00:12:36,360 --> 00:12:38,640 Speaker 5: from high yield bonds right now is between seven and 246 00:12:38,679 --> 00:12:42,160 Speaker 5: eight percent, which relative to what you've gotten over the 247 00:12:42,200 --> 00:12:46,240 Speaker 5: last couple of decades, is really not terrible. However, in 248 00:12:46,320 --> 00:12:49,080 Speaker 5: spread terms, we definitely are tight, which means that the 249 00:12:49,120 --> 00:12:54,240 Speaker 5: cushion against things like defaults is not is not very high. Therefore, 250 00:12:54,360 --> 00:12:56,280 Speaker 5: troking my book a little bit here, you have to 251 00:12:56,280 --> 00:12:58,400 Speaker 5: be active. You can't just jump in there and buy 252 00:12:58,440 --> 00:13:02,640 Speaker 5: these indices because there's very very little cushion against defaults. 253 00:13:02,880 --> 00:13:07,080 Speaker 5: I'm not anticipating a massive slowdown which would really get 254 00:13:07,160 --> 00:13:10,920 Speaker 5: us going towards a space of high level defaults. We 255 00:13:11,000 --> 00:13:14,080 Speaker 5: actually think corporate health is pretty solid right now, but 256 00:13:14,920 --> 00:13:18,199 Speaker 5: I would not want to buy any indices, whether it's 257 00:13:18,200 --> 00:13:21,360 Speaker 5: bank Clon's or high yield or investment grade at this point. 258 00:13:21,240 --> 00:13:35,320 Speaker 2: Should on de side. Thank you so much joining us now, Leslie, 259 00:13:35,400 --> 00:13:40,760 Speaker 2: Benja Murray, Chathamhouse on all that's going on in Washington prior. Frankly, 260 00:13:40,840 --> 00:13:44,640 Speaker 2: she saw this coming, which helps out Leslie not so 261 00:13:44,760 --> 00:13:49,480 Speaker 2: much now what But if we've forgotten that we're supposed 262 00:13:49,480 --> 00:13:54,560 Speaker 2: to have contested elections. We had the Bush Royalty, the 263 00:13:54,559 --> 00:13:59,600 Speaker 2: Obama Royalty, maybe the Clinton royalty times two. I guess 264 00:14:00,160 --> 00:14:02,680 Speaker 2: have we forgotten that it's okay to have a Donnybrook 265 00:14:02,720 --> 00:14:03,400 Speaker 2: to the convention? 266 00:14:05,320 --> 00:14:09,439 Speaker 6: I think we've gotten very risk averse. American politics is tough, 267 00:14:09,520 --> 00:14:14,400 Speaker 6: it's expensive, The electoral system is a very high bar. 268 00:14:14,640 --> 00:14:18,800 Speaker 6: Name recognition is everything. So you know, you might be 269 00:14:18,840 --> 00:14:22,280 Speaker 6: cynical about the American people. I'm not, but I do 270 00:14:22,360 --> 00:14:27,840 Speaker 6: think the system and the institutions make people very verse. 271 00:14:27,880 --> 00:14:29,720 Speaker 6: People at the top of the party structures. 272 00:14:30,160 --> 00:14:33,800 Speaker 2: All the money that's being involved, Mister Cassenberg is driving 273 00:14:33,840 --> 00:14:36,440 Speaker 2: the donor component of this debate in the last seventy 274 00:14:36,480 --> 00:14:39,320 Speaker 2: two hours, and I get the idea that money can 275 00:14:39,360 --> 00:14:43,240 Speaker 2: go to the vice president. Can these other candidates if 276 00:14:43,280 --> 00:14:46,520 Speaker 2: we get to that, can they run to the convention 277 00:14:46,680 --> 00:14:49,840 Speaker 2: in eight weeks? I believe it is with less money, 278 00:14:49,960 --> 00:14:52,480 Speaker 2: or can they not run because they don't have a 279 00:14:52,520 --> 00:14:53,600 Speaker 2: gajillion dollars? 280 00:14:54,840 --> 00:14:57,600 Speaker 6: You know that, as we all know, the first the 281 00:14:57,680 --> 00:15:00,680 Speaker 6: first thing that has to be decided is by President 282 00:15:00,720 --> 00:15:03,320 Speaker 6: Biden whether he's going to run. If he decides not 283 00:15:03,400 --> 00:15:07,320 Speaker 6: to run. Then, of course the entire field opens up 284 00:15:07,360 --> 00:15:09,280 Speaker 6: in a way that you know, we don't have a 285 00:15:09,320 --> 00:15:14,800 Speaker 6: good roadmap for because it's not the normal scenario. But 286 00:15:14,960 --> 00:15:18,480 Speaker 6: could donors get behind a new candidate, Yes, of course 287 00:15:18,520 --> 00:15:21,680 Speaker 6: they could. And this is the conversation that everybody is 288 00:15:21,720 --> 00:15:26,280 Speaker 6: having pretty much around the clock since the debate. But 289 00:15:26,520 --> 00:15:29,320 Speaker 6: so far, you know what we know, and I suspect 290 00:15:29,440 --> 00:15:33,160 Speaker 6: we know a lot less than what's actually transpiring. Is 291 00:15:33,200 --> 00:15:37,280 Speaker 6: that the Biden teamer are locking in. But watch the space. 292 00:15:37,440 --> 00:15:42,600 Speaker 6: One more very significant stumble by President Biden that would 293 00:15:42,600 --> 00:15:45,880 Speaker 6: be difficult to recover, and the very bad scenario is 294 00:15:45,880 --> 00:15:49,440 Speaker 6: that that happens far too late to make a change. 295 00:15:49,480 --> 00:15:53,000 Speaker 6: There are a lot of people now that think that 296 00:15:53,440 --> 00:15:58,160 Speaker 6: they're the vote for Donald Trump is just going to 297 00:15:58,200 --> 00:16:01,760 Speaker 6: be much stronger than people will stay home that we're 298 00:16:01,800 --> 00:16:04,280 Speaker 6: sort of on the fence and thinking about maybe voting 299 00:16:04,320 --> 00:16:07,680 Speaker 6: for President Biden. This is a very risky period and 300 00:16:07,720 --> 00:16:13,040 Speaker 6: comes September when politics and students in America is sort 301 00:16:13,080 --> 00:16:16,000 Speaker 6: of back from the summer. It's going to be a 302 00:16:16,120 --> 00:16:19,680 Speaker 6: very difficult campaign season of very difficult politics. We're a 303 00:16:19,720 --> 00:16:24,040 Speaker 6: little bit on hiatus through July and August, even with 304 00:16:24,120 --> 00:16:24,920 Speaker 6: the conventions. 305 00:16:25,680 --> 00:16:28,360 Speaker 4: Leslie Matt from the fifth floor writes in and just asked, 306 00:16:28,680 --> 00:16:31,920 Speaker 4: was Thursday night just a bad night? Or is it 307 00:16:32,040 --> 00:16:35,960 Speaker 4: something more? If it's something more, what role does a 308 00:16:36,000 --> 00:16:41,120 Speaker 4: democratic I guess party have in kind of suggesting where 309 00:16:41,160 --> 00:16:44,280 Speaker 4: we go from here? Or is it entirely up to 310 00:16:44,360 --> 00:16:45,080 Speaker 4: President Biden? 311 00:16:46,480 --> 00:16:49,000 Speaker 6: Look, I have two answers to that. One is that 312 00:16:49,920 --> 00:16:54,520 Speaker 6: ken President Biden governed for four more years. Absolutely, he 313 00:16:54,560 --> 00:16:58,480 Speaker 6: has an extraordinary team of people around him and pretty 314 00:16:58,560 --> 00:17:03,920 Speaker 6: much every single issue that matters. He doesn't have to 315 00:17:03,960 --> 00:17:07,040 Speaker 6: work twelve hour days. He can make decisions, but let 316 00:17:07,080 --> 00:17:09,960 Speaker 6: other people really do the daily work and the hard 317 00:17:10,000 --> 00:17:13,040 Speaker 6: work of governing. The bigger question, though, is can you 318 00:17:13,040 --> 00:17:16,359 Speaker 6: get elected? And you know, was it a blip? It 319 00:17:16,400 --> 00:17:18,800 Speaker 6: doesn't really matter if it was a blip. The American 320 00:17:18,840 --> 00:17:22,560 Speaker 6: people of the world watched the so called blip. They 321 00:17:22,560 --> 00:17:25,080 Speaker 6: will make their own decisions about whether it was a blip. 322 00:17:25,080 --> 00:17:29,639 Speaker 6: And undoubtedly it is going to unsettle the confidence of 323 00:17:30,640 --> 00:17:32,919 Speaker 6: very many people that were already concerned. 324 00:17:33,440 --> 00:17:36,679 Speaker 2: A couple times this weekend the phrase smoke filled rooms 325 00:17:36,760 --> 00:17:39,640 Speaker 2: came up. I mean, I'm old enough to remember sixty 326 00:17:39,680 --> 00:17:41,879 Speaker 2: eight quite clearly. I guess we're going to redox it 327 00:17:41,960 --> 00:17:46,280 Speaker 2: in Chicago. Define the smoke filled rooms Leslie vin Ja 328 00:17:46,359 --> 00:17:48,560 Speaker 2: Murray of twenty twenty four. 329 00:17:50,080 --> 00:17:53,160 Speaker 6: Now you're going to have to define the smoke filled rooms. Tom, 330 00:17:53,200 --> 00:17:55,320 Speaker 6: I mean, I think it's just not being able to 331 00:17:55,400 --> 00:17:59,400 Speaker 6: see through clearly to what's coming next. On the sixty eight. 332 00:17:59,480 --> 00:18:02,440 Speaker 6: You know everybody wants to go back to nineteen sixty eight. Sure, 333 00:18:03,160 --> 00:18:07,119 Speaker 6: there are some really significant lessons and parallels there. But 334 00:18:07,200 --> 00:18:09,840 Speaker 6: history is, you know, history, what doesn't repeat itself, it 335 00:18:09,880 --> 00:18:10,400 Speaker 6: does rhyme. 336 00:18:10,840 --> 00:18:14,440 Speaker 2: Yeah, let's say, but I think this is really important. 337 00:18:14,920 --> 00:18:17,920 Speaker 2: I'm sorry, but is there no more small field rooms 338 00:18:17,960 --> 00:18:20,840 Speaker 2: because there's a monopoly of a family that runs a 339 00:18:20,840 --> 00:18:24,199 Speaker 2: given party. I don't want to get a Democrat Republican here, 340 00:18:24,520 --> 00:18:28,680 Speaker 2: but there used to be a conversation nationally with cigars 341 00:18:28,720 --> 00:18:32,600 Speaker 2: in hand among a party. Is that like a fiction 342 00:18:32,800 --> 00:18:35,719 Speaker 2: now where it's just run by the critics would say 343 00:18:35,760 --> 00:18:37,600 Speaker 2: the president and the first lady. 344 00:18:38,520 --> 00:18:40,960 Speaker 6: No, I suspect. And again, Tom, this is where we 345 00:18:41,040 --> 00:18:42,919 Speaker 6: don't know everything we'd like to know. We know what 346 00:18:42,960 --> 00:18:44,480 Speaker 6: the New York Times has said, we know what the 347 00:18:44,480 --> 00:18:46,200 Speaker 6: Wall Street Journal has said, we know what the ft 348 00:18:46,320 --> 00:18:48,640 Speaker 6: and the economists have said. The end of the day, 349 00:18:48,720 --> 00:18:51,760 Speaker 6: those conversations are happening. Of course they're happening. They're happening 350 00:18:52,840 --> 00:18:56,680 Speaker 6: out of sight and certainly out of hearing distance. And 351 00:18:56,720 --> 00:18:59,080 Speaker 6: this is why, you know, everybody over the weekend who's 352 00:18:59,119 --> 00:19:01,760 Speaker 6: talking is saying that the Biden team is locking down, 353 00:19:01,760 --> 00:19:04,080 Speaker 6: that they're going to keep the keep President Biden on 354 00:19:04,119 --> 00:19:06,520 Speaker 6: the ticket. And and maybe that's the case, but they're 355 00:19:06,560 --> 00:19:10,480 Speaker 6: certainly not going to say, well, we're not sure. I 356 00:19:10,480 --> 00:19:15,600 Speaker 6: imagine the volatility, uncertainty at a time of two major wars, 357 00:19:16,280 --> 00:19:22,920 Speaker 6: a China threat, you know, a whole amount of global disarray, dysfunction, polarization, 358 00:19:23,000 --> 00:19:26,000 Speaker 6: that's you don't send the signal until you until or 359 00:19:26,080 --> 00:19:28,520 Speaker 6: unless you've made a decision there we will hear nothing 360 00:19:28,600 --> 00:19:31,720 Speaker 6: from the top unless they make that decision. 361 00:19:32,160 --> 00:19:35,040 Speaker 4: Leslie. What's going to happen at this convention. It seems 362 00:19:35,080 --> 00:19:36,600 Speaker 4: like Tom and I need to pay attention to this 363 00:19:36,600 --> 00:19:37,480 Speaker 4: convention coming up. 364 00:19:38,680 --> 00:19:41,000 Speaker 6: I think we all need to pay attention to this convention. 365 00:19:41,600 --> 00:19:44,000 Speaker 6: You know, we can imagine a couple of different scenarios. 366 00:19:44,080 --> 00:19:47,320 Speaker 6: We can imagine that it just sort of goes talking 367 00:19:47,359 --> 00:19:51,200 Speaker 6: obviously about August and not about July. It's a shame 368 00:19:51,200 --> 00:19:53,480 Speaker 6: they're not reversed in terms of the timing. But August 369 00:19:53,520 --> 00:19:57,240 Speaker 6: it could just go as as as planned, or we 370 00:19:57,359 --> 00:20:00,560 Speaker 6: might be in a situation where we are looking at 371 00:20:01,359 --> 00:20:05,560 Speaker 6: Josh Hero, Gretchen Whitmer, Gavin Newsom, you know a number 372 00:20:05,560 --> 00:20:09,960 Speaker 6: of candidates that whose names are out, and about Kamala 373 00:20:10,000 --> 00:20:14,000 Speaker 6: Harris obviously, you know, perhaps to staying as a vice 374 00:20:14,040 --> 00:20:16,879 Speaker 6: president with somebody else on top. There are all sorts 375 00:20:16,880 --> 00:20:20,919 Speaker 6: of scenarios and conversations going on, but that, again, we know, 376 00:20:21,200 --> 00:20:25,320 Speaker 6: depends on the decision that ultimately President Biden opt Tom. 377 00:20:25,960 --> 00:20:39,040 Speaker 2: We gotta go, doctor Vinjaminry, thank you so much. I'm 378 00:20:39,080 --> 00:20:41,120 Speaker 2: a little congested, Lisa, please. 379 00:20:40,840 --> 00:20:42,920 Speaker 7: Sir, very good transition. 380 00:20:43,080 --> 00:20:43,560 Speaker 5: I like that. 381 00:20:44,200 --> 00:20:47,640 Speaker 7: We were just talking about New Jersey transit raising prices. 382 00:20:47,920 --> 00:20:52,760 Speaker 7: My goodness, let's make this transition so congestion pricing in 383 00:20:52,800 --> 00:20:54,359 Speaker 7: New York. It could be getting a new life, but 384 00:20:54,480 --> 00:20:57,200 Speaker 7: it could be okay, So state lawmakers, The New York 385 00:20:57,200 --> 00:21:00,560 Speaker 7: Times says they've been privately this informal campaign to persuade 386 00:21:00,600 --> 00:21:02,800 Speaker 7: Governor Holcal to move ahead with the tolls, but make 387 00:21:02,880 --> 00:21:07,359 Speaker 7: them less expensive, so below the fifteen dollars. They say 388 00:21:07,400 --> 00:21:10,560 Speaker 7: they won't mind adjusting that toll other features of the plan, 389 00:21:10,720 --> 00:21:13,760 Speaker 7: because approving additional revenue could make up for the shortfall 390 00:21:13,840 --> 00:21:17,119 Speaker 7: to the MBA MTA, but only if this program is 391 00:21:17,160 --> 00:21:19,439 Speaker 7: allowed to move forward. So if it moves forward, they said, well, 392 00:21:19,520 --> 00:21:21,840 Speaker 7: let's try and bring the price down a little bit. 393 00:21:21,880 --> 00:21:24,320 Speaker 7: I mean, in London we talked about this. London had 394 00:21:24,359 --> 00:21:27,320 Speaker 7: an initial fee that was half the fifteen dollars charge 395 00:21:27,320 --> 00:21:30,760 Speaker 7: that's being proposed to vehicles in New York City. So 396 00:21:30,800 --> 00:21:33,360 Speaker 7: they're saying, hey, if London, you know, brought it out 397 00:21:33,400 --> 00:21:34,280 Speaker 7: at a cheaper price. 398 00:21:34,640 --> 00:21:38,639 Speaker 4: Well, they've already installed all the monitors all around Manhattan. 399 00:21:38,680 --> 00:21:40,960 Speaker 4: I mean, I don't know what that costs. But here 400 00:21:41,000 --> 00:21:43,200 Speaker 4: on Lexington Avenue and sixty Street you can see them 401 00:21:43,359 --> 00:21:43,720 Speaker 4: right there. 402 00:21:43,800 --> 00:21:44,320 Speaker 7: They're right there. 403 00:21:44,320 --> 00:21:47,160 Speaker 4: They're and they're huge. They're not, I mean they're. 404 00:21:47,240 --> 00:21:49,800 Speaker 7: So they're say, seriously, let's put him to use. Yes, OK, 405 00:21:49,880 --> 00:21:52,040 Speaker 7: but just at a lower price. All right, we'll know 406 00:21:52,080 --> 00:21:52,720 Speaker 7: how that will. 407 00:21:52,800 --> 00:21:55,200 Speaker 4: We'll roll that by John Tucker at some point, see 408 00:21:55,200 --> 00:21:55,640 Speaker 4: what he thinks. 409 00:21:56,880 --> 00:22:00,520 Speaker 2: I don't know where this goes, other than when I 410 00:22:00,560 --> 00:22:04,359 Speaker 2: read about the projects, they're mostly projects we need. They're 411 00:22:04,359 --> 00:22:08,600 Speaker 2: not like desolutely as they're like, okay, we're twenty million 412 00:22:08,640 --> 00:22:14,760 Speaker 2: plus people. We need this, and now we can't do this. Ye, 413 00:22:15,119 --> 00:22:17,199 Speaker 2: and there's people that are saying, you know, no fees, 414 00:22:17,240 --> 00:22:20,160 Speaker 2: like they're like Sweeney in the New Jersey transit thing. 415 00:22:20,240 --> 00:22:25,080 Speaker 2: But I to me, it's just fifteen dollars. Yeah, that's 416 00:22:25,200 --> 00:22:27,440 Speaker 2: you forgot. You gotta pop down to the new era 417 00:22:27,560 --> 00:22:31,160 Speaker 2: baseball cap store at Times Square to keep the little 418 00:22:31,200 --> 00:22:35,520 Speaker 2: one happy. Fifteen bucks to go down and get a 419 00:22:35,560 --> 00:22:38,360 Speaker 2: stupid baseball cap add on it. That's how I look 420 00:22:38,359 --> 00:22:38,600 Speaker 2: at this. 421 00:22:38,680 --> 00:22:40,040 Speaker 4: Yeah, I'm not sure what the price point is, but 422 00:22:40,040 --> 00:22:41,720 Speaker 4: hopefully they can come up with one next. 423 00:22:42,040 --> 00:22:44,760 Speaker 7: All Right. New York Post is pointing to more evidence 424 00:22:44,800 --> 00:22:47,400 Speaker 7: workers in New York City are coming back. 425 00:22:47,200 --> 00:22:48,080 Speaker 4: To the office. 426 00:22:48,240 --> 00:22:50,680 Speaker 7: You guys haven't seen this year, you're not buying it. 427 00:22:51,200 --> 00:22:52,960 Speaker 7: This is according to the Real Estate Board of New 428 00:22:53,040 --> 00:22:56,240 Speaker 7: York Manhattan office visitations. That's what they're saying. In May, 429 00:22:56,400 --> 00:23:00,320 Speaker 7: we're about seventy four percent of level working today new 430 00:23:00,359 --> 00:23:05,560 Speaker 7: visiting are you working? So they base it on visits 431 00:23:05,680 --> 00:23:08,440 Speaker 7: right to about three hundred and fifty office buildings. They 432 00:23:08,440 --> 00:23:10,680 Speaker 7: based it on cell phone records, but also the retail 433 00:23:10,720 --> 00:23:13,400 Speaker 7: traffic in those buildings too, So they're trying to show 434 00:23:13,440 --> 00:23:14,840 Speaker 7: that more people, yes. 435 00:23:14,640 --> 00:23:17,240 Speaker 4: Working, we're still like seventy five percent of pre pandemic 436 00:23:17,320 --> 00:23:18,000 Speaker 4: or something, right. 437 00:23:18,320 --> 00:23:20,760 Speaker 7: Seventy four percent, Yeah, pre pandemic level. 438 00:23:20,880 --> 00:23:21,480 Speaker 2: Do you believe it. 439 00:23:22,600 --> 00:23:23,359 Speaker 3: I'm starting to. 440 00:23:23,359 --> 00:23:25,800 Speaker 7: See more people coming to the office. When I'm talking 441 00:23:25,800 --> 00:23:28,639 Speaker 7: with friends, are like, yeah, we're back like three days 442 00:23:28,680 --> 00:23:30,920 Speaker 7: now instead of fully from Soacre. 443 00:23:30,560 --> 00:23:33,760 Speaker 2: For here, folks, rich, can you get the surveillance cork 444 00:23:33,800 --> 00:23:36,359 Speaker 2: out and put it in my mouth right now? Save 445 00:23:36,440 --> 00:23:37,280 Speaker 2: my employment? 446 00:23:37,600 --> 00:23:38,919 Speaker 7: But look at the flow of people. 447 00:23:39,000 --> 00:23:40,520 Speaker 2: I look at Lexington Avenue. 448 00:23:40,600 --> 00:23:42,439 Speaker 4: Today's a Monday, there's coming up. 449 00:23:43,400 --> 00:23:46,800 Speaker 2: I look at the I look at Lexington Avenue and 450 00:23:46,840 --> 00:23:49,000 Speaker 2: here's the way I look at it. Folks. You're twenty 451 00:23:49,080 --> 00:23:52,320 Speaker 2: something years old, you got a bunch of fancy degrees. 452 00:23:52,480 --> 00:23:55,880 Speaker 2: You're lucky to work at one zero zero xx and 453 00:23:55,920 --> 00:23:59,199 Speaker 2: you're not in on Friday when you can get twenty 454 00:23:59,240 --> 00:24:03,399 Speaker 2: minutes or forty minutes with somebody twenty five years older 455 00:24:03,440 --> 00:24:08,439 Speaker 2: with you to pontificate about wisdom. Yeah, that's that to me, 456 00:24:08,520 --> 00:24:09,119 Speaker 2: that's missing. 457 00:24:10,280 --> 00:24:13,720 Speaker 4: I agree, But I'm I think the hybrid thing is 458 00:24:13,760 --> 00:24:16,719 Speaker 4: here to stay, and that might be that might be 459 00:24:16,760 --> 00:24:18,040 Speaker 4: something that the workforce can be about. 460 00:24:18,320 --> 00:24:21,680 Speaker 2: Come on, Bob, get the court down, next save me mixed. 461 00:24:22,520 --> 00:24:25,280 Speaker 7: How much would you need to make to feel financially secure? 462 00:24:25,320 --> 00:24:27,120 Speaker 7: This is a question that's being put out there. There's 463 00:24:27,160 --> 00:24:30,400 Speaker 7: a study from Bank Great that says, on average, Americans 464 00:24:30,400 --> 00:24:32,480 Speaker 7: think they would need to make one hundred and eighty 465 00:24:32,480 --> 00:24:35,199 Speaker 7: six thousand dollars just to feel comfortable. But if you 466 00:24:35,240 --> 00:24:37,840 Speaker 7: think about it, according to Census Bureau data, it's more 467 00:24:37,840 --> 00:24:40,640 Speaker 7: than two times with the average full time, year round 468 00:24:40,640 --> 00:24:43,760 Speaker 7: worker made in twenty twenty two. So just thirty per 469 00:24:43,800 --> 00:24:46,960 Speaker 7: seven cent percent said that they are likely to even 470 00:24:47,080 --> 00:24:50,440 Speaker 7: earn that much. So people are feeling like they're they're 471 00:24:50,480 --> 00:24:53,080 Speaker 7: not financially secure. That's up from like seventy two percent 472 00:24:53,240 --> 00:24:56,800 Speaker 7: twenty twenty three. Older Americans, baby boomers, gen xers, they're 473 00:24:56,840 --> 00:24:59,639 Speaker 7: more likely to feel that way. And if they want 474 00:24:59,680 --> 00:25:02,600 Speaker 7: to feel financially rich, they have to make five hundred 475 00:25:02,600 --> 00:25:04,440 Speaker 7: and twenty thousand dollars, that's what they're saying. 476 00:25:04,760 --> 00:25:06,840 Speaker 2: This came up not once, but twice this week, and 477 00:25:06,920 --> 00:25:09,200 Speaker 2: I'm sure all of you had the same thing, all 478 00:25:09,240 --> 00:25:13,960 Speaker 2: of you listening across this nation. It's simple. The system's broken, 479 00:25:14,640 --> 00:25:17,320 Speaker 2: and the discussion there's no other way to put it. 480 00:25:17,359 --> 00:25:20,639 Speaker 4: And I think inflation these higher prices that everybody's paying 481 00:25:20,680 --> 00:25:23,240 Speaker 4: for a lot of goods and services. That's making you 482 00:25:23,280 --> 00:25:26,959 Speaker 4: feel probably less secure because I mean you just whatever 483 00:25:27,040 --> 00:25:29,720 Speaker 4: dollar you are making is not buying as much as 484 00:25:29,720 --> 00:25:32,560 Speaker 4: it did four or five, six years ago. So that 485 00:25:32,600 --> 00:25:36,520 Speaker 4: inflation shock that we've all dealt with is still there, 486 00:25:36,640 --> 00:25:38,439 Speaker 4: and I think it's the top of mind for everybody. 487 00:25:38,480 --> 00:25:40,560 Speaker 4: You go to COSTC, you go to a restaurant, you 488 00:25:40,600 --> 00:25:42,080 Speaker 4: go anywhere, I mean. 489 00:25:42,040 --> 00:25:44,959 Speaker 2: Quickly here, you got to have a tough mother like 490 00:25:45,000 --> 00:25:47,840 Speaker 2: Lisa Matteo. Yeah, I mean that's really the first order 491 00:25:48,400 --> 00:25:50,560 Speaker 2: condition because a lot of these kids are just not 492 00:25:50,640 --> 00:25:53,600 Speaker 2: working like we worked. I mean, we thought nothing working 493 00:25:53,720 --> 00:25:55,800 Speaker 2: seventy hours a week, eighty hours a week. It was 494 00:25:55,880 --> 00:25:57,960 Speaker 2: just seven days a week. It was understood. 495 00:25:58,560 --> 00:26:02,720 Speaker 7: Next times changeing, well, you know, it's also changing how 496 00:26:02,800 --> 00:26:05,800 Speaker 7: much money goes into your for one K. Yes, new 497 00:26:05,880 --> 00:26:08,640 Speaker 7: hires putting more money into it, but it's not actually 498 00:26:08,680 --> 00:26:12,800 Speaker 7: their choice in some reasons because the six percent saving 499 00:26:12,840 --> 00:26:14,679 Speaker 7: that's what they're putting into. It's a new standard for 500 00:26:14,800 --> 00:26:17,399 Speaker 7: nearly a third of companies. They use automatic for a 501 00:26:17,520 --> 00:26:20,879 Speaker 7: one K enrollment, So companies are automatically rolling into that 502 00:26:21,000 --> 00:26:21,600 Speaker 7: six percent. 503 00:26:21,680 --> 00:26:24,040 Speaker 4: So you don't opt in, they just take it automatic. 504 00:26:24,520 --> 00:26:29,359 Speaker 2: Really Yeah, major shout out Peter Orzag right right in 505 00:26:29,400 --> 00:26:33,040 Speaker 2: the shop now at Lazard. Peter Orzag at Brookings years 506 00:26:33,040 --> 00:26:37,080 Speaker 2: ago led the charging this. I can't convey how lone 507 00:26:37,720 --> 00:26:41,320 Speaker 2: voice he was on opt in and Peter Orizec coming 508 00:26:41,359 --> 00:26:44,800 Speaker 2: out of LLC with all of his great academics, said 509 00:26:44,840 --> 00:26:46,800 Speaker 2: this is the only way we're going to get it solved. 510 00:26:46,960 --> 00:26:49,840 Speaker 2: My only problem with that is it's six percent correct 511 00:26:49,880 --> 00:26:52,320 Speaker 2: and not more. And I, you know, I don't know 512 00:26:52,320 --> 00:26:55,240 Speaker 2: how we get there. I'll let senior management any given 513 00:26:55,280 --> 00:26:58,680 Speaker 2: firm figure that out. But Orzag drove the boat on this. 514 00:26:59,160 --> 00:27:01,400 Speaker 7: Yeah, but a lot more come sixty percent of companies. 515 00:27:01,640 --> 00:27:04,840 Speaker 2: This is the Bloomberg Surveillance Podcast, bringing you the best 516 00:27:04,840 --> 00:27:09,639 Speaker 2: in economics, finance, investment, and international relations. You can also 517 00:27:09,720 --> 00:27:13,720 Speaker 2: watch the show live on YouTube. Visit the Bloomberg Podcast 518 00:27:13,880 --> 00:27:17,920 Speaker 2: channel on YouTube to see the show weekday mornings from 519 00:27:17,920 --> 00:27:21,199 Speaker 2: seven to ten am Eastern from our global headquarters in 520 00:27:21,280 --> 00:27:25,000 Speaker 2: New York City. Subscribe to the podcast on Apple, Spotify, 521 00:27:25,320 --> 00:27:28,879 Speaker 2: or anywhere else you listen, and always on Bloomberg Radio, 522 00:27:29,080 --> 00:27:32,280 Speaker 2: the Bloomberg Terminal, and the Bloomberg Business app.