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Former Citi Chair Rhodes on the Threats to Global Recovery · Bloomberg Intelligence

0:00
Speaker 1: Welcome to the Bloomberg Markets Podcast. I'm Paul Sweeney. Alongside
0:04
Speaker 1: my co host Matt Miller. Every business day, we bring
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Speaker 1: you interviews from CEOs, market pros, and Bloomberg experts, along
0:11
Speaker 1: with essential market moving news. Find the Bloomberg Markets Podcast
0:15
Speaker 1: on Apple Podcasts or wherever you listen to podcasts, and
0:18
Speaker 1: at Bloomberg dot com slash podcast. I want to get
0:22
Speaker 1: to an old friend of mine, one of my old
0:24
Speaker 1: favorite guests, UM, with whom whom I haven't spoken with since, uh,
0:29
Speaker 1: since I moved here. Bill Rhodes joins us. He used
0:32
Speaker 1: to be the chairman of City and UM. He wrote
0:36
Speaker 1: the book Banker to the World, which I read, uh
0:39
Speaker 1: when I was a young buck in my thirties, and
0:41
Speaker 1: then Kathleen Hayes introduced us. I was I was starstruck
0:44
Speaker 1: a bit, but um, I've got to know him. Bill.
0:47
Speaker 1: Thanks so much for joining us. It's been it's been
0:50
Speaker 1: too long. UM. Let me ask your take first of all,
0:54
Speaker 1: in the situation we find ourselves in now, it's so
0:56
Speaker 1: different than you know. Last time I spoke to you,
0:58
Speaker 1: Donald Trump, um hadn't even been elected, and central bank
1:03
Speaker 1: balance well, the FED balance sheet was was only only
1:06
Speaker 1: at four and a half trillion dollars. And you know,
1:09
Speaker 1: we weren't looking at any kind of stimulus beyond the
1:11
Speaker 1: hundreds of billions we had in tarp. Now we're looking
1:14
Speaker 1: at seven and a half trillion from the Central Bank
1:17
Speaker 1: or in the on the FED balance sheet, and uh,
1:19
Speaker 1: four and a half trillion now six and a half
1:21
Speaker 1: trillion in stimulus. Um. What does that mean to you? Well,
1:25
Speaker 1: first of all, Matt, it's great to be talking to
1:28
Speaker 1: the UN after so long a time, and uh, congratulations
1:31
Speaker 1: on your family, your situation, father, and all of that.
1:35
Speaker 1: I think when you take a look at the FED
1:37
Speaker 1: balance sheet before the Great Recession, it was eight hundred billion.
1:41
Speaker 1: It went to four four point five point seven. Uh,
1:45
Speaker 1: then they started tapering down, and now it's seven and
1:48
Speaker 1: a half as you point out, to eight plus. We
1:50
Speaker 1: have massive stimulus on the on the on the physical side,
1:55
Speaker 1: with this new stimulus built of a of a one
1:58
Speaker 1: point nine trillion, and so I think this is being
2:02
Speaker 1: replicated also in Europe, in China, in Japan, and uh,
2:07
Speaker 1: I think we're revving up the world economy. In the
2:09
Speaker 1: US is supposed to grow at least six percent this year.
2:12
Speaker 1: Some people think six and a half seven some even
2:15
Speaker 1: say eight percent. Uh China sent Europe is a laggered.
2:20
Speaker 1: But my concern is we're seeing this tremendous search and
2:24
Speaker 1: reach for you that every time I've seen before causes
2:28
Speaker 1: problems because eventually the FED is going to have to
2:31
Speaker 1: tighten and the rest of the central banks of the
2:33
Speaker 1: world will have to And when you see tightening, that
2:36
Speaker 1: means rates going up because you have a inflation starting
2:41
Speaker 1: to move from where it's been so low for the
2:43
Speaker 1: last few years. Uh So my concern is where we're
2:47
Speaker 1: gonna be two years from now if the FED doesn't
2:50
Speaker 1: start taking measures at some point in time. So, Bill,
2:54
Speaker 1: how concerned are you? How concerned should we be about
2:58
Speaker 1: this debt we are taking on. I mean, we always
3:01
Speaker 1: talk about it and somebody's got to pay it back,
3:03
Speaker 1: our kids, our grandchildren. When does it become a real
3:08
Speaker 1: fundamental problem in your mind? Well, I think right now
3:11
Speaker 1: the government is doing what it has to do. And
3:13
Speaker 1: I'm a big admirer of Janet Helen, She's a friend,
3:17
Speaker 1: and uh, you know, for the moment, that's fine, but
3:19
Speaker 1: I think we have to be realistic. If we continue
3:22
Speaker 1: this for another year, eighteen months, I think we could
3:26
Speaker 1: get ourselves into real difficult situation. Already, the People's Bank
3:29
Speaker 1: of China is talking about tapering down because they are
3:32
Speaker 1: in a bubble on the real estate area, and they've
3:35
Speaker 1: moved their estimates for this year's growth from eight to
3:39
Speaker 1: six percent because they realize they have to start cutting back.
3:44
Speaker 1: The real danger is that we don't cut back and
3:46
Speaker 1: two years from now we face a real real problem
3:50
Speaker 1: with another blow up. Well, I wonder about, um, what
3:56
Speaker 1: what the poorer countries are looking at? Mean, we talk
3:59
Speaker 1: a lot about I've see America because we lived there,
4:01
Speaker 1: or in the or the West because we lived there.
4:05
Speaker 1: But you cut your teeth in Latin America. Um, you
4:08
Speaker 1: ran the bank's business in lad Am and Africa? And
4:14
Speaker 1: what do you think about these economies that have it
4:16
Speaker 1: so much worse? What's going to happen to them? And
4:18
Speaker 1: is this inequality that already is they're gonna gonna grow
4:21
Speaker 1: even further. That's one of my biggest concerns, Matt, because
4:25
Speaker 1: and I just came out with a piece this morning
4:27
Speaker 1: on vaccines for debt, because I am so concerned that
4:31
Speaker 1: there is not the financing to really uh purchase from
4:35
Speaker 1: the pharmaceutical companies enough vaccines to inoculate the emerging markets
4:41
Speaker 1: Latin America, Africa, parts of Southeast Asia and so the
4:49
Speaker 1: the emerging markets, uh, you know, always catch a cold
4:53
Speaker 1: here after we sneeze, because what happens is that interest
4:57
Speaker 1: rates tend to go up. They have a lot of
5:00
Speaker 1: in currency debt. Uh, they have problems, uh you know,
5:03
Speaker 1: paying back. Just think of Latin American debt crisis when
5:07
Speaker 1: Voker raised interest rates in two and the Asian financial
5:13
Speaker 1: crisis in the nineties. In other words, I've seen this
5:15
Speaker 1: movie with different subtitles too many times. And hopefully the
5:20
Speaker 1: powers that be at the FED and on the fiscal
5:22
Speaker 1: side boat here Europe. China's I said, already is talking
5:26
Speaker 1: about cutting back. Some in Japan do so because the
5:29
Speaker 1: ones that will suffer the most, particularly after this horrendous
5:32
Speaker 1: uh uh you know COVID vaccine problem that you're you're
5:36
Speaker 1: facing with a pandemic in the emerging world. I think
5:40
Speaker 1: too little attention is being given to financing these countries
5:43
Speaker 1: to buy the proper purchase of vaccines. Well, and I
5:48
Speaker 1: just want to make the point that it's not just
5:51
Speaker 1: that they're poorer and worse off. It's not just that
5:55
Speaker 1: they're uh struck by this disease and and and people
5:59
Speaker 1: die and as human tragedy. Bill, But obviously, um, that
6:04
Speaker 1: leads to social unrest the likes of which you've witnessed.
6:07
Speaker 1: You know all too often that leads to problems for
6:11
Speaker 1: the entire world. So it's not just localized, say Venezuela
6:15
Speaker 1: gets hit hard, which they're definitely likely to do. It's
6:18
Speaker 1: not just Venezuela's problem. It's everyone's problem, without a doubt.
6:22
Speaker 1: If we do not take care of supplying the funding
6:27
Speaker 1: for the through kovacs or whatever program. World Bank and
6:31
Speaker 1: American Development Bank are my suggestion of debt for vaccines,
6:36
Speaker 1: the already problem economies of the emerging markets are going
6:40
Speaker 1: to get horrendous. So I am most concerned. Bill talked
6:44
Speaker 1: to us about your plan for vaccines and debt for vaccines.
6:49
Speaker 1: What just gives a sense of what that what you
6:51
Speaker 1: mean by that? Well, Uh, I helped put together the
6:54
Speaker 1: original schemes of debt for equity when the Latin American
6:58
Speaker 1: debt crisis took play, and then years later you had
7:01
Speaker 1: debt for nature. Uh you know you had also uh
7:06
Speaker 1: debt for health and and basically what it is is
7:09
Speaker 1: the pharmaceutical companies agree to accept UH local currency debt
7:15
Speaker 1: UH to provide the vaccines, and then they take uh
7:19
Speaker 1: the local currency either invested in the country UH if
7:22
Speaker 1: they have if they have an operation there, or they
7:26
Speaker 1: sell it to somebody on the open market, or they
7:29
Speaker 1: just decide to keep it. And this will I think
7:32
Speaker 1: UH also enlarge the program of kovacs which the G
7:36
Speaker 1: twenty governments put forward, and the work of the international
7:39
Speaker 1: financial institutions. But we've got to do it now. We
7:42
Speaker 1: can't just wait because as we all know, UH, we
7:46
Speaker 1: may cover uh, you know, vaccines here in the United
7:49
Speaker 1: States and in Europe and in China and Japan, but
7:53
Speaker 1: the world is uh is now in a situation like
7:56
Speaker 1: it wasn't in uh you know, in nineteen eighteen, nineteen
7:59
Speaker 1: and twenty, in a sense of travel. And if you
8:03
Speaker 1: have this problem exists in one part of the world,
8:05
Speaker 1: it'll migrate to another. So we must look at this
8:09
Speaker 1: as an international problem, not just as a domestic problem.
8:13
Speaker 1: And UH that's what really concerns me here. All right, Bill,
8:17
Speaker 1: thank you so much for joining us. We appreciate that.
8:20
Speaker 1: As always, it's great to check up with you, check
8:22
Speaker 1: in with you, get your latest thoughts, particularly as relates
8:25
Speaker 1: to Latin America. Bill has got so much experience there.
8:27
Speaker 1: Bill Rhodes, He's the president CEO of William R. Rhodes
8:30
Speaker 1: Global Adviser's former chairman of City Bank, and man, I
8:33
Speaker 1: love talking to Bill. His perspective is just extraordinary. His
8:38
Speaker 1: experiences is unparalleled. And we really yes the book Banker
8:42
Speaker 1: to the World. I can't recommend reading that enough. And
8:46
Speaker 1: he also wrote an op ed with Stuart McIntosh, who
8:50
Speaker 1: heads the G thirty. You can check that out on
8:52
Speaker 1: Project Syndicate dot org. Yeah, and he just brings up
8:55
Speaker 1: a really key issue about Latin America trying and emerging
8:58
Speaker 1: markets in general trying to get them there. Uh doses,
9:05
Speaker 1: Let's talk about something near and dear to my heart,
9:07
Speaker 1: and that is tacos. Tacos Germany. Um. I mean, I
9:12
Speaker 1: make tacos almost on a weekly basis, so it's not
9:15
Speaker 1: super easy to get um everything you need for it.
9:19
Speaker 1: But I've got a specialty food store. Uh oddly it's
9:23
Speaker 1: an American food store, and I guess tacos should be
9:26
Speaker 1: considered Mexican. I'm I'm not sure. Let's ask somebody who knows.
9:30
Speaker 1: Jason Cappsola joins us, the CEO of Del Taco. Um, Jason,
9:35
Speaker 1: let me first start by asking what the pandemic was
9:38
Speaker 1: like for for you and your franchisees, and what the outlook, Um,
9:43
Speaker 1: what's the outlook? Now? Hey? Well sorry John, John, John,
9:47
Speaker 1: I didn't need to call you, Jason, all right. I
9:49
Speaker 1: wasn't going to that. I was going to correct you.
9:51
Speaker 1: But I'll take it. Don't just roll with it. You know,
9:54
Speaker 1: if I say something wrong, you can correct me. John
9:57
Speaker 1: Capsola Jr. Al Right, well take it. Um, let me
10:00
Speaker 1: tell talk about the pandemic a little bit. Obviously was
10:02
Speaker 1: a challenging operating environment for everyone. Um, we were really
10:06
Speaker 1: proud of our team here at Del Taco. Our restaurant
10:09
Speaker 1: teams are, our franchisees, are support center staff, and and really, um,
10:13
Speaker 1: how we success successfully continue to navigate through a really
10:18
Speaker 1: challenging environment. That is, you know that many of us
10:21
Speaker 1: have not had to face in our lifetimes. So you know, UM,
10:23
Speaker 1: we leaned into our core values and make sure our
10:26
Speaker 1: employees and guests felt comfortable through through our trusted and
10:29
Speaker 1: safe initiatives, and and we continued to operate through our
10:32
Speaker 1: drive throughs and our takeout capability. And we also had
10:36
Speaker 1: a channel in delivery delivery that was rapidly expanding. I
10:39
Speaker 1: mean delivery grew three to four times during the pandemic,
10:42
Speaker 1: so plenty of service modes and options for consumers to
10:46
Speaker 1: access the brand. We tried to take advantage of all
10:49
Speaker 1: of them. Even though our dining rooms were closed down,
10:51
Speaker 1: we were able to get back to positive same store
10:54
Speaker 1: sales growth in Q three and Q four. UM really
10:58
Speaker 1: saw our franchise business, which represent Sense a larger geographic
11:01
Speaker 1: footprint for US around fifteen states, accelerate UM sequentially from
11:05
Speaker 1: Q three to Q four in that mid single digit range.
11:08
Speaker 1: And actually I finished their eighth consecutive year of positive
11:11
Speaker 1: same source sales growth. So from an outlook perspective, and
11:14
Speaker 1: I look at one, we talked about continuing to grow
11:17
Speaker 1: our same store sales and our a v S through
11:19
Speaker 1: our five drivers of of acceleration that we've outlined, and
11:23
Speaker 1: and UM having modest you know, restaurant contribution, margin expansion
11:27
Speaker 1: UM out that will lead to even of growth. In
11:31
Speaker 1: John talk to us, I know you have a lot
11:33
Speaker 1: of exposure to the state of California, and California is
11:36
Speaker 1: really aggressive and shutting down restaurants, so I'm guessing that
11:40
Speaker 1: was good news for you know, the del Tacos of
11:43
Speaker 1: the world, you know, fast food or drive through business.
11:47
Speaker 1: Talk to us how much that was a a tail
11:49
Speaker 1: wind for you during the pandemic and and to what
11:51
Speaker 1: extent will that be a headwind going forward? Sure, Yeah,
11:55
Speaker 1: there's definitely put some takes in regards to that dynamic.
11:58
Speaker 1: And California, where we have a heavy opera reading footprint,
12:01
Speaker 1: clearly was very restrictive and we saw, um, as we
12:04
Speaker 1: talked about on our earnings call, markets in California counties
12:08
Speaker 1: in California that we're very restrictive where we're we were
12:11
Speaker 1: still running on the company side of the house negative
12:15
Speaker 1: same store sales in Q four and despite that we
12:18
Speaker 1: were able to overcome through performance and all of our
12:20
Speaker 1: other markets, um, you know, positive the same store sales
12:24
Speaker 1: in Q four on the company business and uh it clearly,
12:27
Speaker 1: as I stated, franchise has been very positive for some
12:29
Speaker 1: time now over a broader geographic footprints. So so we
12:33
Speaker 1: feel good about how we're positioned moving forward. Listen, there
12:38
Speaker 1: there will be a dynamic shift here as as um Obviously,
12:42
Speaker 1: vaccines get out and guests feel a lot more comfortable
12:45
Speaker 1: getting back out and about and being more active, and
12:48
Speaker 1: and and and we think that that's a good thing overall.
12:51
Speaker 1: I mean, when you think about UM folks returning to
12:54
Speaker 1: school on a more regular basis, day and day out,
12:56
Speaker 1: going to work, you know, movie theaters opening back up.
12:59
Speaker 1: Normal activity is starting to happen in the environment around us.
13:04
Speaker 1: That is a great thing for all restaurants, and specifically
13:07
Speaker 1: for quick service restaurants. I think about that from a
13:09
Speaker 1: standpoint of value and convenience. I mean, the convenience that
13:12
Speaker 1: people need when they're on the go is pervasive in
13:15
Speaker 1: our category. We deliver on that. And then obviously, UM
13:18
Speaker 1: guests always need good value, So I think we're well positioned. Well.
13:21
Speaker 1: I wonder how, UM, you know, how sticky the behavior
13:25
Speaker 1: we've learned through the pandemic is going to be after
13:28
Speaker 1: you have a new store design fresh Flex, which I
13:32
Speaker 1: guess um takes advantage of a pandemic situation. Rights, it's
13:38
Speaker 1: much easier to drive through, you've got two lanes, UM,
13:40
Speaker 1: it's much easier to have a third party deliver, You've
13:43
Speaker 1: got a special UM area for that station for third
13:46
Speaker 1: party pickup. Is this gonna stick? Do you think fresh
13:50
Speaker 1: Flex is going to be more successful in places than
13:53
Speaker 1: your typical and your traditional restaurant. Listen, I think that
13:57
Speaker 1: it needs to be a portfolio prout approach. And the
14:00
Speaker 1: great thing about or the silver lining I should say
14:03
Speaker 1: that occurred through this pandemic is that guests really and
14:06
Speaker 1: consumers figure it out. They they they you know, adopted technology,
14:11
Speaker 1: use technology to access the brands that they love where
14:15
Speaker 1: they could and UM, certainly with the growth and delivery
14:18
Speaker 1: and off premise in our category, that was pretty evident.
14:22
Speaker 1: So fresh Flex definitely takes advantage of that and integrates
14:26
Speaker 1: technology well throughout our prototypes. But the bigger piece is
14:30
Speaker 1: as we lean in towards franchise growth across the country, UM,
14:34
Speaker 1: we'll we'll be able to offer our active developers really
14:38
Speaker 1: a portfolio MENUA venues initiative that we call it, where
14:42
Speaker 1: you can build restaurants from from twelve square foot drive
14:46
Speaker 1: through only buildings all the way up to a standard
14:48
Speaker 1: build out dining room and UM that gives you more
14:51
Speaker 1: access to real estate and gives you the opportunity to
14:54
Speaker 1: be a bit more entrepreneurial in the way that you're
14:55
Speaker 1: thinking about build out. So we think that matches the
14:58
Speaker 1: environment from a consumer and a real estate perspective. Hey, John,
15:01
Speaker 1: thanks so much for joining us. We really appreciate your
15:03
Speaker 1: thoughts here. John Kappa Sola, Junior CEO of Del Taco,
15:06
Speaker 1: that's a publicly traded company on nastak Great Sybil t
15:09
Speaker 1: a c O. You know, we talked last hour about
15:15
Speaker 1: the taco business. Now we're talking barbecue. And the reason
15:19
Speaker 1: we're talking barbecue is because the great State of Texas
15:22
Speaker 1: is reopening fully today, no mask mandate anymore. What does
15:26
Speaker 1: that mean for business and life in Texas? And what
15:31
Speaker 1: better place to talk about it than Lexington, Texas. We're
15:34
Speaker 1: gonna talk to Carrie Bexley. Carry is the owner of
15:37
Speaker 1: Snows Barbecue, some infamous famous barbecue Lexic and Texas. I
15:42
Speaker 1: looked at my Google maps, uh, Matt, and again, Lexing
15:44
Speaker 1: and Texas is literally equidice between Austin, Texas and college
15:48
Speaker 1: stage and so uh just extraordinary. Carrie, thanks so much
15:51
Speaker 1: for joining us here. I'd love to get your thoughts
15:55
Speaker 1: on what the reopening move in your state of Texas,
15:59
Speaker 1: what that's gonna be for your business. Well, we're we're
16:03
Speaker 1: taking it pretty slow. We're kind of skeptical of a
16:05
Speaker 1: few things. And again, hopefully blessed to get back to
16:09
Speaker 1: normal activities at some point. But again, we're just kind
16:14
Speaker 1: of taking it slow and a few changes at a time.
16:18
Speaker 1: I'm worried about your pit master. Tootsie is uh, well,
16:21
Speaker 1: she's got to be eighty four, eighty five years old,
16:24
Speaker 1: and she's got to be one of the most famous
16:26
Speaker 1: pit masters now in the world. How she's how she
16:30
Speaker 1: survived through COVID, Well, she's continued to kind of operate
16:34
Speaker 1: it normal again, the social distancing and the mask wearing,
16:38
Speaker 1: she's done that. And again a lot of our reactions
16:42
Speaker 1: stems from her and a couple other employees that are
16:44
Speaker 1: including myself, that are own up in age. But she's
16:48
Speaker 1: she's doing great. She's uh like you said, she's eighty five,
16:51
Speaker 1: will be eighty six here, I think in April and
16:54
Speaker 1: uh man, and we we just want to clone her
16:57
Speaker 1: and find some more that can can keep going like
17:01
Speaker 1: she does. But again that's the reason we're, like I said,
17:04
Speaker 1: some of our precautions. We're just taking it slow and
17:06
Speaker 1: not just gonna flip the switch overnight and drop all
17:10
Speaker 1: our gold. How's how's gonna work here? I mean, you
17:13
Speaker 1: only open on Saturdays anyway, so you gotta worry about
17:15
Speaker 1: one day a week you open, I guess eight ish
17:18
Speaker 1: eight o'clock, right, do you tell people they have to
17:21
Speaker 1: stay uh, you know, six ft away from each other?
17:24
Speaker 1: Are only letting people in with masks, even though they're
17:27
Speaker 1: allowed to come in without a mask, Like, what are
17:29
Speaker 1: you doing? Uh? Our line? We don't regulate it very
17:33
Speaker 1: very closely. I mean, everybody use their own best judgment.
17:37
Speaker 1: But once we enter our building, and again we're pretty small,
17:40
Speaker 1: our quarters are pretty tight. When you enter the build
17:43
Speaker 1: into order and get your barbecue, it's uh, mask a
17:46
Speaker 1: required and we're going to continue to to leave that
17:49
Speaker 1: in place at this time. I mean, everybody's kind of adapted.
17:52
Speaker 1: We've had no problems. Again, the Barbecue family is just
17:57
Speaker 1: uh second to none as far as good quality people.
18:00
Speaker 1: We haven't had any you know, like I said, any
18:02
Speaker 1: red flags or any problems with that, and we're going
18:04
Speaker 1: to leave that in place at this time. Carrie, tell
18:08
Speaker 1: us about how your business was impacted. You know, we're
18:10
Speaker 1: we've been twelve months into this pandemic here almost to
18:14
Speaker 1: the day. Here. It gives a sense of how your
18:15
Speaker 1: pissess changed. March of last year, Well, it was just
18:19
Speaker 1: kind of an overnight switch and when you know, at
18:22
Speaker 1: first we were really curious just to see what kind
18:24
Speaker 1: of crowd we would have and and it was just
18:26
Speaker 1: overwhelming and how good it was when it first hit.
18:30
Speaker 1: And then the wife and I got to talking and
18:32
Speaker 1: our schools had shut down and everything, and and nine
18:36
Speaker 1: of our clientele is out of country, out of state,
18:39
Speaker 1: out of town, and you know, with our school shut down,
18:41
Speaker 1: we didn't want to be bringing the people into our town.
18:44
Speaker 1: So at that time, we made the decision to close
18:47
Speaker 1: UH in March of last year, and we were closed
18:50
Speaker 1: UH completely from March until November. UH. All we focused
18:54
Speaker 1: on was our online shipping. It increased. We were fortunate
18:57
Speaker 1: enough to have that already in place and stoop holes
19:00
Speaker 1: and Nate and it increased, UH dramatically really and you know,
19:06
Speaker 1: it was kind of like almost a Christmas rush. Again.
19:09
Speaker 1: I had to you know, revamp them and be able
19:12
Speaker 1: to keep up. And UM, it's been that way kind
19:15
Speaker 1: of the whole time. Our online business has picked up.
19:18
Speaker 1: And does what I want to hear about that, Kerry,
19:20
Speaker 1: I want to hear about that. I know that I
19:22
Speaker 1: know that in the past you've had customers who fly
19:25
Speaker 1: in from Hong Kong just to get your barbecue. Um,
19:29
Speaker 1: that's no joke. So but now you have an online
19:31
Speaker 1: business and I wonder how that has, uh, how that's developed.
19:36
Speaker 1: I mean I'm looking at your website Snow's Barbecue dot
19:39
Speaker 1: com and just thinking about ordering a little brisket myself
19:41
Speaker 1: out here and I'm in Berlin. Well again, it has been.
19:46
Speaker 1: Like I said, we were blessed to already have that
19:48
Speaker 1: in place, being a one day a week. Uh. Then
19:52
Speaker 1: you we we had to have a place to go
19:54
Speaker 1: in order if we had anything left from day one,
19:56
Speaker 1: and that's why I put the shipping in place. And
19:59
Speaker 1: again from the endemic hid it just increased in our
20:03
Speaker 1: our feedback and a lot of our customers. I mean
20:05
Speaker 1: I don't know the percentage exactly, but to repeat customers
20:08
Speaker 1: that order on a regular basis, I mean we we
20:11
Speaker 1: manage yet just like we do on Saturday's. Quality is
20:14
Speaker 1: our our main concern and customer service. And like I said,
20:18
Speaker 1: we're not not real large. We're also on gold Belly,
20:22
Speaker 1: which you can get the same thing on our website
20:24
Speaker 1: in it. But it's been great, uh, I mean it's
20:29
Speaker 1: far as quality. When you rewarm it in New York,
20:32
Speaker 1: you lose very little. And you know, back to what
20:35
Speaker 1: you said, our customers from all over the world, and
20:37
Speaker 1: that is that's the case. Every Saturday is kind of
20:40
Speaker 1: like a a festival one day a week. I mean,
20:42
Speaker 1: we have people from all over the world every Saturday,
20:45
Speaker 1: and we're just truly blessed. And like I said, the
20:48
Speaker 1: pandemic isn't probly he had us, but we've been fortunate
20:51
Speaker 1: enough to make some changes and and handle it quite well. Well.
20:56
Speaker 1: We wish you the best care you send the best
20:57
Speaker 1: to your family and to Tutsie down there and everybody
21:00
Speaker 1: in Lexington as well. Um, I'm so glad that you've survived,
21:04
Speaker 1: uh and and come out stronger on the other side
21:06
Speaker 1: of this. Well, hopefully we get to the other side
21:08
Speaker 1: of this. Carrie Bexley there, who runs Snow's Barbecue, voted
21:13
Speaker 1: the best barbecue in Texas, and Texas is a big state,
21:17
Speaker 1: so that's a very very big deal. To Jean Chanzano,
21:25
Speaker 1: Bloomberg Politics contributor, she's also a professor at I ownA
21:30
Speaker 1: to talk a little bit about this couple of trillion
21:33
Speaker 1: dollars we're about to pump into the US economy. Um, Geane,
21:38
Speaker 1: what do you think, I mean, my first question about this,
21:42
Speaker 1: beyond you know, where should they send my check, is
21:46
Speaker 1: is it going to be inflationary or are the deflationary
21:49
Speaker 1: forces so strong right now that we shouldn't be worried
21:52
Speaker 1: about that. I love how you said just a couple
21:55
Speaker 1: of trillion dollars give or takes, right, just a few
21:59
Speaker 1: And I think that's really, you know, part of what
22:01
Speaker 1: we're all just looking at today, which is it's difficult
22:05
Speaker 1: to tell people the size of this thing. I think
22:08
Speaker 1: one point that really struck with me is that the
22:10
Speaker 1: Watson Institute had out a piece which said, we spent
22:14
Speaker 1: in twenty years on the war on terror five point
22:16
Speaker 1: for trillion. In the last year, including this bill, we
22:19
Speaker 1: spend six trillion on the coronavirus alone, on this pandemic.
22:23
Speaker 1: And so this is the largest standalone stimulus package in
22:27
Speaker 1: American history. Obviously, so it's unprecedented in Biden's you know,
22:32
Speaker 1: arguably fifty day in office. But to your point, that
22:35
Speaker 1: is the big question in the big debate is is
22:37
Speaker 1: this thing going to trigger inflation? And I don't think
22:41
Speaker 1: we know. We've heard some people, even Democrats, say that
22:44
Speaker 1: it could, and other people push back, like Janet Yellen,
22:48
Speaker 1: for instance. UM, so I don't think we know. Um,
22:52
Speaker 1: if it just fills out the outpost gaps, it's going
22:55
Speaker 1: to be okay. But if it does trigger inflation, Jerome
22:59
Speaker 1: Powell has said he can deal with it, you know.
23:01
Speaker 1: I think we have to take a weight and see
23:02
Speaker 1: attitude on that at this point. All right, So Jeannie.
23:05
Speaker 1: From a political perspective, Um, what does it mean that
23:09
Speaker 1: this bill is likely to be passed and signed probably
23:12
Speaker 1: today into law strictly on party lines, no bipartisanship whatsoever.
23:18
Speaker 1: It means that despite the fact that six or seven
23:21
Speaker 1: out of ten Americans, including majorities of Republicans, said they
23:24
Speaker 1: support this bill, the Republican Party is hanging together and
23:28
Speaker 1: saying not so fast. And we heard Liz Cheney and
23:31
Speaker 1: others say, the big problem here is that of this bill,
23:36
Speaker 1: according to Republicans, has nothing to do with fighting the
23:39
Speaker 1: pandemic or restoring the economy. So they will point you
23:42
Speaker 1: to things, and I do think I they have a
23:45
Speaker 1: point to a certain extent, like the expansion of the
23:48
Speaker 1: A C. A. These have been long time progressive democratic wishes.
23:53
Speaker 1: They've been able to do that under this bill. It
23:56
Speaker 1: may according the CBO increased by about add about one
23:59
Speaker 1: point seven million more to the insurance roles. That's something
24:02
Speaker 1: Democrats have wanted, and it's fascinating to me when Republicans
24:06
Speaker 1: have made this charge about them. Democrats have said, yeah,
24:09
Speaker 1: and so what, we absolutely are fulfilling our wish list
24:12
Speaker 1: of things. So they you know, this bill has been
24:15
Speaker 1: so popular, Democrats are happy to run on it. And
24:17
Speaker 1: we're gonna see Joe Biden out there tomorrow night with
24:20
Speaker 1: his first address to the nation. He hasn't, obviously in
24:23
Speaker 1: fifty days, as you guys know better than I do,
24:25
Speaker 1: even done a press conference yet, but I think we're
24:27
Speaker 1: going to see him out doing something like that in
24:29
Speaker 1: the next few days as well. Gene, he can do
24:31
Speaker 1: whatever he wants. They can do whatever they want now,
24:34
Speaker 1: you know, forget about the other side. I mean, of
24:36
Speaker 1: course there was talk about unity at the inauguration, but
24:40
Speaker 1: you know, there's nothing unity about this. They're just gonna
24:44
Speaker 1: roll over the Republicans. Does it matter? It does matter,
24:48
Speaker 1: And it matters not just for you know, people who
24:50
Speaker 1: don't like the bill. It matters for Democrats, not only
24:52
Speaker 1: the Joe Biden promise by partisanship, but it's a fifty
24:55
Speaker 1: fifty Senate. You can't get anything done outside of reconciliation
25:00
Speaker 1: and without ten Republicans. And that's the big problem for him.
25:03
Speaker 1: Look at he's talking about, you know, something around a
25:05
Speaker 1: two three trillion dollar build back Better program including infrastructure.
25:11
Speaker 1: It's unclear if he can do that on reconciliation. Maybe
25:14
Speaker 1: he can, but if he doesn't, he's going to need Republicans.
25:17
Speaker 1: And so my big question is does he bring them
25:20
Speaker 1: on early and move it through with them or does
25:22
Speaker 1: he sort of put it on their lap and say,
25:24
Speaker 1: you know, support it or don't. We can go ahead
25:26
Speaker 1: without you. But we're talking about another huge spending bill,
25:30
Speaker 1: if not more, and that's not to even mention immigration,
25:33
Speaker 1: voting rights, and the labor law that that the House
25:36
Speaker 1: passed yesterday. Are you surprised, let's talk about that, you
25:38
Speaker 1: need some of the other legislation that this administration would
25:42
Speaker 1: like to get done, probably sooner rather than later. And
25:44
Speaker 1: you mentioned a few areas. Is it surprising to you
25:47
Speaker 1: that with a president that's been so many years in
25:50
Speaker 1: the Senate, nobody knows the Senate and it's working better
25:53
Speaker 1: than Joe Biden presumably, And then of course a vice
25:55
Speaker 1: president who was just came out of the Senate. Presumably
25:58
Speaker 1: has those current relationships surprised that they haven't been able
26:02
Speaker 1: to get any bipartisan support for this bill. I am
26:05
Speaker 1: not surprised, because no matter how much Joe Biden or
26:08
Speaker 1: to your point, Kamala Harris No and understand the Senate,
26:11
Speaker 1: and they do, Biden arguably better than any president we've
26:14
Speaker 1: had in recent history. We have a structural divide in
26:18
Speaker 1: our system which makes it very, very tough for any
26:21
Speaker 1: president to get bills through Congress, but particularly even when
26:25
Speaker 1: their party controls it. But this narrow control of a
26:28
Speaker 1: fifty fifty makes it that much tougher. So I think
26:32
Speaker 1: my surprise was the other day when Jensaki said the
26:35
Speaker 1: president is not supporting still the filibuster reform or getting
26:39
Speaker 1: rid of the filibuster. I was a bit surprised she
26:41
Speaker 1: said that, because I'm not sure how he intends to
26:45
Speaker 1: achieve the rest of this mammoth program he has promised
26:48
Speaker 1: to the American public in the absence of that kind
26:51
Speaker 1: of reform. Well, I mean, you only want to get
26:53
Speaker 1: rid of the filibuster while you're in power, right, Well,
26:56
Speaker 1: that's right, and then you rue the day that you
26:58
Speaker 1: did it. That's absolutely true. Be careful what you wished
27:02
Speaker 1: for exactly. That's the kind of thing that they would
27:04
Speaker 1: feel pretty bad about if they lost the authority. Geen,
27:08
Speaker 1: great talking you hope we can have you back on
27:10
Speaker 1: again soon. Jeane Schanzay know, there is uh professor at Iona,
27:14
Speaker 1: so you can take her class if you go there.
27:16
Speaker 1: And she's also a Bloomberg Politics contributors, so you can
27:19
Speaker 1: read her column if you come here. Um, it's gonna
27:23
Speaker 1: be so fascinating to see how this plays out when
27:25
Speaker 1: it gets to the infrastructure part of that. Yeah, that's
27:27
Speaker 1: gonna be the big one, Matt. I mean, that's gonna
27:29
Speaker 1: be um, you know, bigger numbers. Presumably its infrastructure, so
27:33
Speaker 1: it should have some bipartisan support. Doesn't everybody like having
27:37
Speaker 1: bridges and tunnels built in their district? You would think so,
27:41
Speaker 1: But we'll have to see. We'll certainly have more on
27:42
Speaker 1: that coming up. This is Bloomberg. Thanks for listening to
27:46
Speaker 1: the Bloomberg Markets podcast. You can subscribe and listen to
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Speaker 1: interviews with Apple Podcasts or whatever podcast platform you prefer.
27:54
Speaker 1: I'm Matt Miller. I'm on Twitter at Matt Miller pet
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Speaker 1: the podcast. You can always catch us worldwide at Bloomberg
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