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Bitcoin Soars, Trump Impact on Oil Producers · Bloomberg Intelligence

• 0:00
  Speaker 1: Bloomberg Audio Studios, podcasts, radio news.
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  Speaker 2: You're listening to the Bloomberg Intelligence Podcast. Catch us live
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  Speaker 2: Listen on demand wherever you get your podcasts, or watch
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  Speaker 2: us live on YouTube.
• 0:23
  Speaker 4: Molly, A lot of movement here in a commodity's gold off,
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  Speaker 4: big Bitcoin.
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  Speaker 5: Ripping, absolutely ripping. So who do we eaty two thousand?
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  Speaker 3: Yes?
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  Speaker 6: So who do we talk to?
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  Speaker 4: We talked to Michael bloone Miami, Mike, Senior Commodity Strategies
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  Speaker 4: for Bloomberg Intelligence. Safely esconced in Miami. He was doing
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  Speaker 4: Miami before it was really chic. He was down there early.
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  Speaker 4: Mike talked to us first about Bitcoin eighty two. We're
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  Speaker 4: pushing up against eighty three thousand dollars per token.
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  Speaker 6: What's happening here?
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  Speaker 7: The world changed last Tuesday and it's almost a perfect
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  Speaker 7: storm for bitcoin. So think of all the anti bitcoin
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  Speaker 7: regulation and pushback from the pre Use Administration and Gary Gensler,
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  Speaker 7: that's completely flipped. It's delightful to see for some of
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  Speaker 7: us who wrote about this five years ago that any
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  Speaker 7: US representative or regulator that did not understand that the
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  Speaker 7: base layer of this place was actually organically went for
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  Speaker 7: the dollar most widely trading bitcoin cryptos not bitcoin. It's
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  Speaker 7: actually tether. The dollar token was Finally, it's delightful to
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  Speaker 7: see them figuring it out. What's really happening in this space.
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  Speaker 7: So it's nothing but good for bitcoin. The market's getting frothy,
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  Speaker 7: but it had a good period of six months which
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  Speaker 7: just hung out. Now it's just taking off and you're
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  Speaker 7: seeing massive inflows in ETFs. People can get exposed to
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  Speaker 7: it and it's kind of kicking into the little match.
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  Speaker 7: Is a digital goal or is leverage stock market? Right now,
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  Speaker 7: it's stock workers making new high bitcoins, making new high
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  Speaker 7: bitcoins back to it leadership role.
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  Speaker 8: Mike, tell me how much of this trade right now
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  Speaker 8: is dependent on Gary Gensler not being in the SEC
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  Speaker 8: and it can trump?
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  Speaker 5: Honestly do that?
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  Speaker 7: Oh sure, well he's going to be gone within months.
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  Speaker 7: It's just a question of when. He's very unfavorable SEC chairman.
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  Speaker 7: He made a lot of enemies on both sides of
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  Speaker 7: the aisle, but this is just part of what got
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  Speaker 7: him elected. It's the key thing I think the market's
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  Speaker 7: figuring out is let's not underestimate this. In Bolden next president.
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  Speaker 7: He has been re elected by completely decisive election, and
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  Speaker 7: his mantra everything he said in his campaign, I'd say
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  Speaker 7: be careful to disagree with. For instance, I'm reading the
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  Speaker 7: latest book for Robert Leiittheiser, who was his past trade representative,
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  Speaker 7: and it's called no trade is Free, and we shouldn't
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  Speaker 7: expect him to do what he says, partly because he
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  Speaker 7: has carte blanche at least to the midterms, and there's
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  Speaker 7: still pretty significant trade depthsits So from a commodity standpoint,
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  Speaker 7: it's very bearish. From a bitcoin standpoint, it's very bullish,
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  Speaker 7: partly because he tilted over and he got the bitcoin
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  Speaker 7: people on his side. I don't think he wants to
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  Speaker 7: upset them.
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  Speaker 4: Mike, I can't even remember the last time we talked
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  Speaker 4: about valuation and how you're supposed to value bitcoin. Just
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  Speaker 4: refresh our memory on how you think about that whole consent.
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  Speaker 7: Yeah, well, in pectical analysis, so I mean, I like
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  Speaker 7: to compare it versus gold right now I'm looking at it.
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  Speaker 7: It's as some hedge fund managers call it, the fastest
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  Speaker 7: horse in the race. I mean versus all risk acids.
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  Speaker 7: The risk right now is bitcoins making new record highst
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  Speaker 7: but it's correlation sixty day correlation to this SMB five
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  Speaker 7: hundred ato point seven or so is the highest ever
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  Speaker 7: on the way up, So it's a leading risk acid.
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  Speaker 7: It's rice for all this optimism about us, you know,
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  Speaker 7: the Trump election, but markets are so expensive ready versus
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  Speaker 7: when he was elected twenty sixteen, they were very low.
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  Speaker 7: Certainly bitcoin was. So there's so many ways, but stocks
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  Speaker 7: to use is one way to do it. The key
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  Speaker 7: thing that I like to say is there's definable diminishing
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  Speaker 7: supply and you can see that by just the code,
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  Speaker 7: and there's increasing demand and adoption, so over time the
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  Speaker 7: price must go up. And right now it had a
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  Speaker 7: major switch flip that this the unexpected election of mister
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  Speaker 7: Trump has just flipped it over to the bullish spirits
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  Speaker 7: at the moment.
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  Speaker 8: Now, this is something I was really surprised to read
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  Speaker 8: in one of our stories that bitcoin now ranks only
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  Speaker 8: second to the fossil fuel industry, or rather the crypto
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  Speaker 8: industry at large, and total money deployed since the twenty
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  Speaker 8: ten Supreme Court decision that limited funds on campaign political
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  Speaker 8: spending that's shocking anyone else to think that crypto is
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  Speaker 8: number two to fossil fuels. Where is all this cap
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  Speaker 8: campaign influence money coming from?
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  Speaker 7: Mike?
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  Speaker 5: Who are the big spenders here?
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  Speaker 7: So well, I don't know exactly who they are. I mean,
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  Speaker 7: last time we heard from the bidenminstration, Sam Bankman Freed
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  Speaker 7: was the number two donator. That didn't work out so well.
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  Speaker 7: That's why partly the bidenministration pushed back after the collapse
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  Speaker 7: at the FTX. The bottom line is, let's look at
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  Speaker 7: an ETPs now ETFs Bitcoin's about ninety two billion. Total
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  Speaker 7: gold ETPs are about two hundred and thirty billions, so
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  Speaker 7: let's catching up fast. And remember this Bitcoin's only been
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  Speaker 7: trading in exchange traded funds for a few years. Gold's
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  Speaker 7: been almost twenty years in exchange traded funds. So it's
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  Speaker 7: just the you know, the digital goal is taken on
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  Speaker 7: the old analog goal, and the question where it stops.
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  Speaker 7: The way I see it right now is yes, everything
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  Speaker 7: looks so bullish, it's just a little bit expensive. But
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  Speaker 7: I published today is bitcoin digital gold or is it
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  Speaker 7: leverage baiting? Right now? It's much more leveraged version the
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  Speaker 7: stock market and animal spirits are in full force.
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  Speaker 4: Uh you mentioned gold, Mike. Gold is down about two
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  Speaker 4: point three percent today. What's the trade here in gold?
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  Speaker 4: Is this just a taking some money off the table
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  Speaker 4: after a big.
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  Speaker 7: Run, potential lesson of geopolitical risks, the definitive election of
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  Speaker 7: Donald Trump. Gold was way overdue for a correction of
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  Speaker 7: already hearing of inklings of mister Putin and mister Trump
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  Speaker 7: talking this last weekend. And if there's any you know,
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  Speaker 7: Dayton coming in the world, that's going to be a
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  Speaker 7: major pressure factor for gold. But in the meantime, gold
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  Speaker 7: on the one year basis is still up about the
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  Speaker 7: same as S and P five hundred, around thirty five percent.
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  Speaker 7: It's way overdue for a correction. I'm looking at twenty
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  Speaker 7: four to twenty five hundred as good support level as
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  Speaker 7: it could come back to. It just got way too bensive.
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  Speaker 7: So at its peak I think that was early October,
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  Speaker 7: is up thirty nine percent of the year. That would
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  Speaker 7: have been the best year since nineteen seventy nine. So
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  Speaker 7: it's a bull market pulling back. But then looking forward,
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  Speaker 7: if there's much if there's a major shift in what's
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  Speaker 7: happening in China, I mean, mister Z kind of filtering
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  Speaker 7: away from President Putin maybe towards the US. That's bad
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  Speaker 7: for gold, But overall it's the key thing is there's
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  Speaker 7: still some major geopolitical factors supporting going to the bottom line,
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  Speaker 7: like say, for gold, is gold will be Gold's major catalyst.
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  Speaker 7: I think to go hires at some point when we
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  Speaker 7: see the next bear market in US stock market, maybe
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  Speaker 7: God help us if that ever happens again.
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  Speaker 6: All right, Mike, thanks so much for joining us. As always,
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  Speaker 6: Mike mclohan.
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  Speaker 4: He's a senior commodity strategist for Bloomberg Intelligence.
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  Speaker 6: B I go go check out all his research on
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  Speaker 6: all commodities.
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  Speaker 4: He covers everything from the sauce, you know, the grains,
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  Speaker 4: to the metals to the all kinds of stuff, including
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  Speaker 4: a bitcoin, so he kind of has it all covered there.
• 6:56
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• 7:14
  Speaker 4: Kim Farrest joins US founder and chief investment Officer, Boca
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  Speaker 4: Capital Partners on zoom from Pittsburgh, one of my favorite towns. So, Kim,
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  Speaker 4: you woke up with your team on Wednesday last week.
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  Speaker 4: What changed for you guys, if anything? And your outlook
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  Speaker 4: for markets if anything? If anything?
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  Speaker 9: If anything, yeah, well, really nothing, because our few is
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  Speaker 9: the long term. We believe strongly that if you have
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  Speaker 9: money in the market, it should be in there for
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  Speaker 9: a minimum of three to five years. You know, you
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  Speaker 9: can think about harvesting what we do today in three
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  Speaker 9: to five years, so that.
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  Speaker 7: Kind of.
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  Speaker 9: You know, time heals a lot of wounds, we'll just say,
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  Speaker 9: and makes things better in the long run, and you
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  Speaker 9: just have to work with what you have. So that's
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  Speaker 9: what we're doing. And actually nothing changed because we were
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  Speaker 9: believers in having that Barbell strategy of large cap and
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  Speaker 9: small cap together. Small cap has been suffering for a
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  Speaker 9: myriad of reasons, and we're looking at and by small cap,
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  Speaker 9: I mean companies that have a billion or more in
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  Speaker 9: market cap. The microcaps were not at all interested in.
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  Speaker 9: So we think that, you know, the large caps have
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  Speaker 9: had a great run over the last couple of years,
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  Speaker 9: and it looks like maybe small cap will have its
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  Speaker 9: moment in the sun coming up in the next couple
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  Speaker 9: of years.
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  Speaker 8: So are you saying him that, like, you're not really
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  Speaker 8: buying into the Trump trade. You're not out there, you know,
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  Speaker 8: buying it's on a bitcoin and silling treasuries right now.
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  Speaker 9: I'm sorry, I couldn't even let you get that out.
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  Speaker 9: Buying a lot of bitcoin. Well, you know, paint me
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  Speaker 9: as old fashioned. While I think bitcoin is interesting to watch,
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  Speaker 9: I don't really know how to value it.
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  Speaker 2: I don't.
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  Speaker 9: I heard your guest on the prior segment also kind
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  Speaker 9: of reflecting that. And my big thing whenever I talk
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  Speaker 9: to investors that we serve about bitcoin is whenever you
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  Speaker 9: can pay your taxes with it, I'll pay attention to
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  Speaker 9: it then because that means it's.
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  Speaker 6: A real currency.
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  Speaker 9: Right now, it is not a real currency.
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  Speaker 4: So Kim, when when you look at the small caps, boy,
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  Speaker 4: you've got to have a good call on management because
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  Speaker 4: they have such an outsized influence on kind of just
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  Speaker 4: kind of how the business develops.
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  Speaker 6: You how do you do that with some of these
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  Speaker 6: smaller cap companies?
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  Speaker 9: Sure, well, first thing, we have time on our side.
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  Speaker 7: Case.
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  Speaker 9: I've been doing this for twenty four years and I
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  Speaker 9: started on the cell side, where my director of research
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  Speaker 9: encouraged me to have half small cap half large caps.
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  Speaker 9: So I'm kind of in the groove on this. But
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  Speaker 9: what I do is I look for several markers. First
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  Speaker 9: of all, growth is always important. I am not strictly
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  Speaker 9: a growth manager. I'm growth at a reasonable price, but
• 10:05
  Speaker 9: growth has to be there. And how do you get growth, Well,
• 10:08
  Speaker 9: you sell more product, and how do you do that
• 10:11
  Speaker 9: product marketing? It sounds really boring, but what it really
• 10:14
  Speaker 9: is is having a process to understand your client or
• 10:19
  Speaker 9: customer and then having a repeatable process where you make
• 10:24
  Speaker 9: your product and service to light your customer and they
• 10:27
  Speaker 9: come back over and over and over again. And can
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  Speaker 9: it really be that easy? Yes, it is. It's hard
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  Speaker 9: to spot and you have to do a lot of
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  Speaker 9: fundamental research. But that's what we're doing, is looking for
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  Speaker 9: that kind of perpetual money machine where businesses know what
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  Speaker 9: clients they serve and every day get up and try
• 10:45
  Speaker 9: to serve them the best they can.
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  Speaker 8: So it's like you've got you know, with earning season
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  Speaker 8: still going on, we've got the retailers coming up next.
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  Speaker 8: Just tell me about your view right now of the
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  Speaker 8: US consumer, the economy, at large. You know, there's been
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  Speaker 8: all these calls for slow down and it just hasn't
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  Speaker 8: really been all that noticeable yet, and so.
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  Speaker 5: Just wondering when you really think that tipping point's going
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  Speaker 5: to happen.
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  Speaker 9: Sure, well, I kind of have an unusual view of
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  Speaker 9: the economy. I think there's a lot of slowness out
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  Speaker 9: there if you go out and look for it, pretty
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  Speaker 9: much in people who are in the lower two thirds
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  Speaker 9: of the economic food chain, we'll just call it. There's
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  Speaker 9: a lot of stress. If you walk around stores like Walmart,
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  Speaker 9: you hear a lot of discussions about what we can
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  Speaker 9: and can't buy as a family, And I think that
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  Speaker 9: had a lot of influence.
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  Speaker 6: On the election, right.
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  Speaker 9: But more importantly, I'm not one of the people that
• 11:41
  Speaker 9: are necessarily looking for the next recession either. I think
• 11:45
  Speaker 9: we have these slowdowns now. And why do I think that, Well,
• 11:48
  Speaker 9: companies have software in place like CRM Salesforce to be
• 11:53
  Speaker 9: able to understand what their pipeline is, and then they
• 11:57
  Speaker 9: have erp or exotic or very fancy accounting systems that
• 12:02
  Speaker 9: let them match the supply and demand. So we have
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  Speaker 9: seen over the past twenty years very few or no
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  Speaker 9: recessions that were caused by too much capacity.
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  Speaker 10: Right.
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  Speaker 9: Companies are really good about being able to tailor that
• 12:19
  Speaker 9: to the conditions. But we do have crisis, and nobody
• 12:22
  Speaker 9: can really predict crises very well, or at least the
• 12:25
  Speaker 9: timing of them. They may see them coming. So that's
• 12:29
  Speaker 9: what I think the economy does.
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  Speaker 6: Now, right, all right, Kim, thanks so much for joining us.
• 12:34
  Speaker 6: Really appreciated as always, Kim Farish.
• 12:36
  Speaker 4: She's a founder and chief investment officer Boca Capital Partners
• 12:40
  Speaker 4: in from Pittsburgh, PA, one of my favorite towns.
• 12:44
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• 13:00
  Speaker 4: Today, Signia Group said it won't pursue a combination with
• 13:03
  Speaker 4: rival Ensure Humana after reports two companies had renewed discussions.
• 13:08
  Speaker 4: Signa shares jump by eight point seven at the New
• 13:10
  Speaker 4: York market open, while shares in Humanity dropped by six percent,
• 13:13
  Speaker 4: So not so much here for this particular deal.
• 13:17
  Speaker 6: Glenn Losev Joints is.
• 13:19
  Speaker 4: He's a senior Equiano's covering a healthcare services space for
• 13:22
  Speaker 4: Bloomberg Intelligency Joints was here in a New York Bloomberg
• 13:25
  Speaker 4: Interactive Brokers studio in New York. So Glenn talk to
• 13:28
  Speaker 4: us about this deal that did not happen between Signa
• 13:32
  Speaker 4: and Humana.
• 13:34
  Speaker 11: Yes, so this is the second try. If it wasn't
• 13:37
  Speaker 11: the rumor the first time the companies tried to merge
• 13:42
  Speaker 11: at the end of last year, it also didn't take
• 13:47
  Speaker 11: long to sort of to fall apart. This was the
• 13:53
  Speaker 11: last the second time, and you know, we don't exactly
• 13:58
  Speaker 11: know what happened, but my view was that the the
• 14:02
  Speaker 11: takeout price for Humana the companies will not agree upon,
• 14:09
  Speaker 11: and that's probably the reason over the last eleven month
• 14:15
  Speaker 11: Humana lost half of its market cap. You know, it's
• 14:19
  Speaker 11: very difficult. Obviously Signa is a much better place to
• 14:23
  Speaker 11: to sort of to pitch the merger, but also when
• 14:26
  Speaker 11: you were trading it twice the market cap just a
• 14:30
  Speaker 11: few months ago, you know, it's difficult to agree on
• 14:33
  Speaker 11: price and they.
• 14:35
  Speaker 8: Couldn't really adjust that at this stage, you know, with
• 14:39
  Speaker 8: with Humanis stock now having dropped so much in the meantime, That's.
• 14:43
  Speaker 11: What I'm thinking. This is it wasn't confirmed. The only
• 14:45
  Speaker 11: thing that Signa said that they're not pursuing the merger,
• 14:50
  Speaker 11: but price is probably the reason for it, the agreement
• 14:53
  Speaker 11: and the price.
• 14:54
  Speaker 3: All right, so.
• 14:56
  Speaker 6: Is insurance company? Yes, Humana is a healthcare services provider.
• 15:03
  Speaker 11: No, so, Signa and Humana are both health insurance insurance.
• 15:08
  Speaker 11: Signa has a huge pharmaceutical benefit manager express Script. If
• 15:12
  Speaker 11: you remember they are a few years ago, it's one
• 15:15
  Speaker 11: of the top three human and and also seeing that
• 15:19
  Speaker 11: focuses more on the commercial business, which is employer employer
• 15:25
  Speaker 11: based UH insurance, while Humana is focusing on medicare people
• 15:30
  Speaker 11: who are over sixty five?
• 15:32
  Speaker 3: Got it?
• 15:33
  Speaker 8: And you got to think now, like Signa's sack up
• 15:35
  Speaker 8: a good bit today. They've done a lot of share buybacks.
• 15:38
  Speaker 8: Would think that that's going to be now the strategy
• 15:40
  Speaker 8: going forward back to those Yeah, again, what else do
• 15:44
  Speaker 8: you do when you're not about to spend a couple
• 15:45
  Speaker 8: billion dollars on another company?
• 15:48
  Speaker 11: You you basically yeah, but you're basically they're they're they're
• 15:53
  Speaker 11: expanding their UH sort of expanding their pharmacy business UH
• 16:00
  Speaker 11: part of the express Script. That's where the tailwans are
• 16:04
  Speaker 11: over the next few years, and just stugging along trying
• 16:08
  Speaker 11: to you know, cut costs and improve revenue. That's basically
• 16:12
  Speaker 11: the business model.
• 16:13
  Speaker 10: All right.
• 16:14
  Speaker 4: So healthcare investors, they woke up Wednesday morning last week,
• 16:19
  Speaker 4: what did the election mean for the health care space?
• 16:22
  Speaker 11: So for healthcare space, it's very broad. But for example,
• 16:25
  Speaker 11: for health insurance, basically it's Trump's win is positive for
• 16:31
  Speaker 11: Medicare advantage companies rule of time sort of like Humana,
• 16:36
  Speaker 11: And there's an overhang of for Medicaid insurance companies like
• 16:43
  Speaker 11: Stina and Malina because of the work requirements, possibilities and
• 16:48
  Speaker 11: about my care, about my care subsidies expiring at the
• 16:54
  Speaker 11: end of the end of the.
• 16:57
  Speaker 5: Four His presidency is also obviously positive for m and A.
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  Speaker 8: Any chance that you know, this deal gets revisited again
• 17:04
  Speaker 8: or SIGNA maybe has another target.
• 17:06
  Speaker 11: There is always a chance for this deal to be
• 17:10
  Speaker 11: revisited again.
• 17:11
  Speaker 8: We got to give Paul a chance to live out
• 17:13
  Speaker 8: his stream here being a healthcare of an a banker.
• 17:16
  Speaker 3: Right.
• 17:17
  Speaker 11: Over All, overall, managed care industry is facing headwinds. You know,
• 17:26
  Speaker 11: costs are going up government that is through the roof,
• 17:32
  Speaker 11: so they're not going to get paid as much as
• 17:34
  Speaker 11: they did five years ago, so it's a marching contraction possibility,
• 17:39
  Speaker 11: so you know, buying another health insurance companies always benefit
• 17:46
  Speaker 11: for help for insurance business. Any insurance business. Scale is
• 17:49
  Speaker 11: the king for any type of insurance business. So there's
• 17:53
  Speaker 11: certainly possibility that they will revisit and maybe a gree
• 17:56
  Speaker 11: on the price this time.
• 17:57
  Speaker 6: All right, Glennlassa, thank you so much for joining us.
• 17:59
  Speaker 4: Glenlaw so he's a senior ecoanas covering the healthcare services
• 18:02
  Speaker 4: businesses for Bloomberg Intelligence. You can get his research by
• 18:06
  Speaker 4: going b I go on the terminal and then you
• 18:09
  Speaker 4: can go down to the healthcare stuff and we got
• 18:11
  Speaker 4: it all covered on a global scale.
• 18:14
  Speaker 6: So we appreciate gating a few minutes of this time.
• 18:15
  Speaker 6: A deal, I guess not happening in.
• 18:17
  Speaker 5: The healthcare space, so you'll have to look for another one.
• 18:20
  Speaker 6: Yeah, exactly.
• 18:21
  Speaker 4: But again it just seems like if a lot of
• 18:23
  Speaker 4: these big farmer companies that they can't come up with
• 18:25
  Speaker 4: whatever they need to come up with through their R
• 18:26
  Speaker 4: and D, they just got to just go on.
• 18:28
  Speaker 3: And buy it.
• 18:28
  Speaker 5: Yeah, if it's not organic, you know exactly right.
• 18:32
  Speaker 2: You're listening to the Bloomberg Intelligence podcast. Catch us live
• 18:36
  Speaker 2: weekdays at ten am Eastern on applecar.
• 18:39
  Speaker 3: Play and Android Auto with the Bloomberg Business.
• 18:42
  Speaker 2: You can also listen live on Amazon Alexa from our
• 18:44
  Speaker 2: flagship New York station Just Say Alexa playing Bloomberg eleven thirty.
• 18:50
  Speaker 4: All right, Molly Smith sitting in for Alex Steele Paul
• 18:53
  Speaker 4: Swhen you were live here in our Bloomberg Interactive Brokers
• 18:55
  Speaker 4: studio streaming live on YouTube as well, So go over
• 18:58
  Speaker 4: there and check us out. You can search Bloomberg Podcast
• 19:00
  Speaker 4: and that's where you will find it. A lot of
• 19:02
  Speaker 4: questions being asked by market participants about some of the
• 19:06
  Speaker 4: policies that we may see coming out of President like
• 19:08
  Speaker 4: Trump's second stint in the White House. David Young joins us.
• 19:13
  Speaker 4: He's a president the Public Policy Center at the Conference Board. David,
• 19:17
  Speaker 4: thanks so much for joining us here. What are the
• 19:19
  Speaker 4: key areas you're looking for or looking at with a
• 19:24
  Speaker 4: Republican in the White House, a Republican Senate, and potentially
• 19:28
  Speaker 4: a Republican House, how do you think we'll see policy
• 19:31
  Speaker 4: ramifications stem from that?
• 19:34
  Speaker 3: Yeah? Well, good morning, and thank you again for having
• 19:36
  Speaker 3: me on.
• 19:36
  Speaker 12: I found the conversation before very interesting and also just
• 19:39
  Speaker 12: a side note, as a former division one tennis player
• 19:42
  Speaker 12: unfortunately was not six foot one to six three. That
• 19:47
  Speaker 12: profession was short lived. But yeah, when we're looking at
• 19:51
  Speaker 12: top kind of you know, the initial priorities from a
• 19:57
  Speaker 12: Trump two point zero administration, I think the one that
• 20:01
  Speaker 12: is talked about most, and you guys were talking about
• 20:03
  Speaker 12: it earlier is tariffs. Obviously you guys mentioned this. You know,
• 20:08
  Speaker 12: there's this ten plus so ten to twenty percent universal
• 20:13
  Speaker 12: tariff that Trump has talked about, but then also the
• 20:16
  Speaker 12: sixty percent tariff on China. I think it's also important
• 20:20
  Speaker 12: to just mention when we talk about tariffs here there
• 20:23
  Speaker 12: is also a direct correlation towards trade, and when we
• 20:28
  Speaker 12: start talking about trade, we start talking about trade agreements.
• 20:31
  Speaker 12: So upcoming next year will be the renewal should any
• 20:34
  Speaker 12: of the three countries, Canada, the US, or Mexico require it, a.
• 20:39
  Speaker 3: Renewal or refresh of the US.
• 20:41
  Speaker 12: MCA, which I think will have some pretty significant ramifications,
• 20:47
  Speaker 12: especially given the role and relationship between Mexico and Canada.
• 20:52
  Speaker 12: I describe Mexico increasingly as one of those connector economies,
• 20:58
  Speaker 12: so goods come from China Mexico then up through the US.
• 21:01
  Speaker 12: So it will be really interesting to see what Trump
• 21:03
  Speaker 12: does with regards to that trade agreement and how he
• 21:07
  Speaker 12: leverages tariffs beyond Teriff, a couple other areas to mention climate,
• 21:15
  Speaker 12: and what he does with biden era of regulation with
• 21:18
  Speaker 12: regards to climate, but also beyond just what Biden did
• 21:22
  Speaker 12: international trade agreements. So Trump has said that in his
• 21:26
  Speaker 12: initial days in office, taking a much closer look at
• 21:30
  Speaker 12: the Paris Agreement and potentially leaving that agreement. In addition
• 21:35
  Speaker 12: to Terriff's and climate. Obviously the regulatory environment and regulation reform,
• 21:42
  Speaker 12: industrial policy, and electric vehicles. I know you guys were
• 21:45
  Speaker 12: talking earlier about Tesla. Trump has said that he would
• 21:49
  Speaker 12: repeal Biden's electric vehicle mandate. And also there have been
• 21:56
  Speaker 12: conversations around the value of the Chipsacks Chips Act versus
• 22:00
  Speaker 12: the role and impact of tariffs. Finally, the tax bill.
• 22:06
  Speaker 3: And what that means in the year ahead.
• 22:08
  Speaker 12: And those are some of the domestic issues I think
• 22:11
  Speaker 12: from a foreign policy standpoint, the two that initially jump
• 22:16
  Speaker 12: out obviously Russia and Ukraine, and also Israel, Gaza Lebanon,
• 22:23
  Speaker 12: the future role of Iran and what Trump decides to
• 22:27
  Speaker 12: do with regards to those two issues. I'm not forgetting
• 22:32
  Speaker 12: China and Taiwan. I just have left that one to
• 22:35
  Speaker 12: the third position because the other two kind of have
• 22:39
  Speaker 12: dominated over the last twelve months. But with regards to
• 22:44
  Speaker 12: China and Taiwan, it is clear of China's intentions, and
• 22:49
  Speaker 12: so you can only anticipate that issue area from a
• 22:53
  Speaker 12: foreign policy standpoint getting more and more traction in the
• 22:57
  Speaker 12: years ahead.
• 22:58
  Speaker 8: Thanks David, that was very comprehensive look at what we're
• 23:00
  Speaker 8: going to expect. You know something that in my other
• 23:04
  Speaker 8: day job here at Bloomberg, I cover the US economy
• 23:07
  Speaker 8: and we take a look at that confidence index that
• 23:10
  Speaker 8: your firm puts out every month, and we're going to
• 23:13
  Speaker 8: get the latest look at that a little bit later
• 23:15
  Speaker 8: this month for the November reading. Just tell me a
• 23:18
  Speaker 8: little bit about what your expectations are ahead of that.
• 23:21
  Speaker 8: We know it's an index that you know, tends to
• 23:23
  Speaker 8: be a bit more tilted toward consumer views of the
• 23:26
  Speaker 8: job market. But you know, curious to think, you know,
• 23:29
  Speaker 8: especially based on the reactions from the exit polls and
• 23:32
  Speaker 8: how consumers were obviously or voters rather were very concerned
• 23:36
  Speaker 8: with the economy, how you think that the election results
• 23:39
  Speaker 8: might be reflected in the next reading.
• 23:42
  Speaker 12: Yeah, so it is interesting and if you look at confidence,
• 23:44
  Speaker 12: it's definitely moving. The trend is moving in the right direction,
• 23:47
  Speaker 12: but it's it's interesting when you look at the right
• 23:49
  Speaker 12: direction and things improving, did that actually relate to how
• 23:53
  Speaker 12: voters voted on the day. And there's definitely a degree
• 23:58
  Speaker 12: of disconnect. And I think from from Harris's perspective, she
• 24:02
  Speaker 12: was unable to convince voters that recent improvements in the economy,
• 24:07
  Speaker 12: including the decline in the headline inflation, stronger than expected growth,
• 24:14
  Speaker 12: have made a difference in them in kind of voters' lives.
• 24:17
  Speaker 12: So number one, there is a disconnect, and I think
• 24:20
  Speaker 12: there is also certainly a lag when you start looking
• 24:23
  Speaker 12: at what people believe, how they feel, and how they
• 24:28
  Speaker 12: actually went out on that day and voted. I think
• 24:31
  Speaker 12: that also connects and has shown to you know, if
• 24:33
  Speaker 12: it is not the top issue area that affected how
• 24:37
  Speaker 12: people voted, it is one of the top two issues,
• 24:41
  Speaker 12: which is just economic growth and the economy and in
• 24:46
  Speaker 12: terms of how that's playing out on a daily basis.
• 24:49
  Speaker 6: David, thank you so much for joining us.
• 24:51
  Speaker 4: David Young, he's a president a public policy center at
• 24:54
  Speaker 4: the Conference Board, joining us via zoom from Atlanta here.
• 24:58
  Speaker 4: So I have to see again the early days of
• 25:01
  Speaker 4: president like Donald Trump. His administration, like any administration, is
• 25:05
  Speaker 4: first one hundred days or our key to really get
• 25:08
  Speaker 4: things done. So we'll see how aggressive mister Trump's administrations
• 25:12
  Speaker 4: will be coming out of the gate.
• 25:14
  Speaker 2: There you're listening to the Bloomberg Intelligence Podcast. Catch us
• 25:19
  Speaker 2: live weekdays at ten am Eastern on applecar.
• 25:22
  Speaker 3: Play and Android Otto with the Bloomberg Business App.
• 25:25
  Speaker 2: You can also listen live on Amazon Alexa from our
• 25:28
  Speaker 2: flagship New York station Just Say Alexa playing Bloomberg eleven thirty.
• 25:34
  Speaker 4: Well, Paul Sweeney were live here in our Bloomberg Interactive
• 25:36
  Speaker 4: Broker studio. We're streaming live on YouTube, So go over
• 25:39
  Speaker 4: to YouTube dot com search Bloomberg Podcast and that's where
• 25:41
  Speaker 4: you'll find us. All Right, here's the mistake I make
• 25:43
  Speaker 4: when thinking about commercial real estate.
• 25:45
  Speaker 6: I just think offices.
• 25:47
  Speaker 4: But there's so much fun, which I keep getting schooled
• 25:50
  Speaker 4: on it brought in your I knew, I knew multi
• 25:53
  Speaker 4: family housing, student housing, warehouses, all that kind of stuff.
• 25:58
  Speaker 6: Our next guest can he can kind of help me
• 26:00
  Speaker 6: out here?
• 26:00
  Speaker 4: Jeff Brown, founder and CEO T two Capital Management, joining
• 26:04
  Speaker 4: us from Chicago via that zoom thing.
• 26:06
  Speaker 6: Hey, Jeff, talk to us.
• 26:07
  Speaker 4: About where you guys at T two ten to traffic
• 26:11
  Speaker 4: in commercial real estate?
• 26:12
  Speaker 6: What's your area of expertise?
• 26:15
  Speaker 10: Sure for starters PLA.
• 26:17
  Speaker 13: I appreciate your delineating office from the broader commercial real
• 26:20
  Speaker 13: estate mark.
• 26:20
  Speaker 10: A lot of people do jump into that pool. Yeah.
• 26:23
  Speaker 10: T two.
• 26:24
  Speaker 13: We are very focused on the student housing space, on
• 26:26
  Speaker 13: the multi family space, and we also run a private
• 26:29
  Speaker 13: credit fund as well.
• 26:31
  Speaker 8: You know, I find a student housing story so fascinating
• 26:34
  Speaker 8: because this is like, you know, we talk about in
• 26:36
  Speaker 8: the US economy, this structural shortage of housing, like you know,
• 26:39
  Speaker 8: just for like everyday people, single family homes. But it's
• 26:43
  Speaker 8: really like in some places, no more evident than on
• 26:47
  Speaker 8: a college campus. There's been so many stories about, you know,
• 26:50
  Speaker 8: at UCLA, like kids renting out you know, RV's and
• 26:54
  Speaker 8: like tryk well really renting out a private person's driveway
• 26:57
  Speaker 8: to put the RV so because they can't find a
• 27:00
  Speaker 8: place to live. And where I went to school, Syracuse,
• 27:03
  Speaker 8: a hotel that was in the middle of campus is
• 27:06
  Speaker 8: now fully a dorm and another apartment building bought back
• 27:09
  Speaker 8: to be a dorm.
• 27:10
  Speaker 5: Anyways, all that to say, where are all these students
• 27:14
  Speaker 5: living and where are the opportunities for you guys to
• 27:16
  Speaker 5: come in and help.
• 27:18
  Speaker 13: Yeah, those are great anecdotes, smallite that are still pervasive today.
• 27:23
  Speaker 13: So for us in the student housing space, we're active
• 27:25
  Speaker 13: at schools like Purdue, Auburn University down in Alabama, University
• 27:32
  Speaker 13: of Tennessee, Georgia Tech.
• 27:33
  Speaker 10: So we tend to migrate toward where there's.
• 27:35
  Speaker 13: Really explosive enrollment growth, where there's a stem focus, just
• 27:39
  Speaker 13: a high demand for students to be there. Ironically, some
• 27:42
  Speaker 13: of the anecdotes you just shared about students beingforced to
• 27:45
  Speaker 13: live in hotels or just these makeshift apartments on campus
• 27:50
  Speaker 13: because of the lack of supply. That has been our
• 27:53
  Speaker 13: story at University of Tennessee as well as Purdue. So
• 27:56
  Speaker 13: we're benefactors of those as landlords, but hate to be it,
• 27:59
  Speaker 13: frankly for the students and those parents.
• 28:02
  Speaker 4: You know, in my freshman year at the University of Richmond.
• 28:05
  Speaker 6: It was a trailer where you lived.
• 28:08
  Speaker 5: Yes, was there not a dorm.
• 28:10
  Speaker 6: There was not a dorm. It was a trailer. My
• 28:12
  Speaker 6: dad pulls up to unload music. You gotta be kidding
• 28:14
  Speaker 6: me for the money turnaround. We had a heck of
• 28:17
  Speaker 6: a good time in those trailers.
• 28:19
  Speaker 11: We'll just leave it at that.
• 28:20
  Speaker 6: The mods down to the University of Richmond.
• 28:23
  Speaker 4: Hey, Jeff, if you want to go out and build
• 28:25
  Speaker 4: some student housing and multi family housing, where are you
• 28:28
  Speaker 4: going to get the money?
• 28:28
  Speaker 6: Are banks lending?
• 28:31
  Speaker 10: Yeah?
• 28:32
  Speaker 13: Thankfully, I would say banks are lending. It's certainly much
• 28:35
  Speaker 13: more conservative than probably historical standards. Interestingly, banks, I find
• 28:41
  Speaker 13: them uniquely healthy right now. I think so many learn
• 28:44
  Speaker 13: to their lessons from the two thousand and eight global
• 28:46
  Speaker 13: financial crisis, and they have ratcheted back advanced levels, so
• 28:50
  Speaker 13: they just have some decreased exposure. So maybe historically they
• 28:53
  Speaker 13: would have been at sixty five or seventy percent of
• 28:55
  Speaker 13: cost or value on a project. I think today it's
• 28:57
  Speaker 13: pretty customary to be at fifty five or sixty percent
• 29:00
  Speaker 13: advanced rates. A lot of buffer for them, but the
• 29:02
  Speaker 13: margin for air. So I would say banks are actively lending.
• 29:07
  Speaker 13: There the hard part, frankly, and I think I heard
• 29:10
  Speaker 13: your prior guests even touch on this.
• 29:12
  Speaker 10: The hard part is finding the equity. So if banks
• 29:14
  Speaker 10: are at fifty five or sixty percent, where are you
• 29:16
  Speaker 10: getting that.
• 29:16
  Speaker 13: Other forty or forty five percent of the capital stack
• 29:20
  Speaker 13: necessary to take on a project and that's been a
• 29:23
  Speaker 13: bit of a Rubis cube, frankly for the past couple
• 29:25
  Speaker 13: of years, as interest rates of spiked and capitals retreated
• 29:27
  Speaker 13: to the sidelines.
• 29:29
  Speaker 8: What do you do when you're looking though, at such
• 29:31
  Speaker 8: a constrained labor supply right now in construction, and especially
• 29:35
  Speaker 8: with the prospect of this new administration, really, you know,
• 29:40
  Speaker 8: rolling back a lot of the immigrant workforce. Is that
• 29:44
  Speaker 8: concerning to you of how much more building can really
• 29:47
  Speaker 8: happen in the next four years?
• 29:50
  Speaker 13: It is, And I'll tell you, going back to the
• 29:52
  Speaker 13: student housing aspect of our business, we have bought far
• 29:56
  Speaker 13: more existing student housing and did some cosmetic changes properties
• 30:00
  Speaker 13: when we have done ground up development, simply because most
• 30:04
  Speaker 13: construction costs are They really spiked during COVID and caught
• 30:07
  Speaker 13: a lot of attention for supply chain.
• 30:09
  Speaker 10: Issues, shortage of labor and other variables.
• 30:13
  Speaker 13: Unfortunately, the cost of construction hasn't plausibly come down to
• 30:17
  Speaker 13: where it's still viable to build ground up construction.
• 30:20
  Speaker 10: Certainly, some folks can get away with it.
• 30:22
  Speaker 13: They'll take on lower margin projects thinking that maybe down
• 30:26
  Speaker 13: the road the margins will make some sense. But it's
• 30:29
  Speaker 13: been very, very tricky to make numbers work in the
• 30:33
  Speaker 13: ground up construction, whether it's student multi or any other
• 30:36
  Speaker 13: asset class.
• 30:37
  Speaker 4: How about you know we talked about student housing, how
• 30:39
  Speaker 4: about senior housing? I mean, all we hear about is
• 30:42
  Speaker 4: how this population is aging and there's going to need
• 30:44
  Speaker 4: to be for more and more senior communities.
• 30:46
  Speaker 3: Is that?
• 30:46
  Speaker 6: How do you guys think about that business? Have you
• 30:48
  Speaker 6: looked at that?
• 30:49
  Speaker 13: We've looked at it, We've participated in it, and we've
• 30:52
  Speaker 13: kind of we've just paused on it. Frankly, it's a
• 30:55
  Speaker 13: very operationally intensive business where you're so dependent on Like
• 31:00
  Speaker 13: I said, it's a running business. So we have your
• 31:02
  Speaker 13: operator who's handling all the day to day activities. Oftentimes
• 31:06
  Speaker 13: there can be a bit of a misalignment between operations
• 31:08
  Speaker 13: and ownership and the property. We try to stay away
• 31:11
  Speaker 13: from those situations and just stick to what we know best,
• 31:14
  Speaker 13: which is student and multi.
• 31:17
  Speaker 8: I got to ask you, though, you know something that
• 31:19
  Speaker 8: I wonder when I see all of these universities that
• 31:21
  Speaker 8: are like busting at the seams with students and nowhere
• 31:25
  Speaker 8: to put them, are enrollment rates that much higher?
• 31:28
  Speaker 5: Acceptance rates rather that much higher?
• 31:30
  Speaker 8: Like I mean, because right now, the sentiment about getting
• 31:33
  Speaker 8: a college education has really never been worse. So I
• 31:35
  Speaker 8: just wonder are the universities just letting in that many
• 31:39
  Speaker 8: more kids?
• 31:41
  Speaker 13: A great, great question, Mollie, and I'd say, just like
• 31:45
  Speaker 13: Paul did a start off, this segment office doesn't define
• 31:48
  Speaker 13: how the commercial real state market is doing. I think
• 31:51
  Speaker 13: you really got to be careful with which student housing markets,
• 31:54
  Speaker 13: which campuses you're at, before you say a broadbreast.
• 31:57
  Speaker 10: Statement about student housing as a whole.
• 31:59
  Speaker 13: There are some schools that are seeing our record applications
• 32:04
  Speaker 13: and having the choice to make where how do we
• 32:06
  Speaker 13: want to go with a record enrollment as well, and
• 32:08
  Speaker 13: they got to be mindful of how much supply, how
• 32:10
  Speaker 13: much infrastructure alone, classrooms and other space available on campus
• 32:16
  Speaker 13: do they have to accommodate the student population.
• 32:20
  Speaker 10: So it.
• 32:21
  Speaker 13: Is it's very school specific from my perspective, and that's
• 32:25
  Speaker 13: where I think Tennessee and produced schools that we're very
• 32:29
  Speaker 13: close to. I've done a fantastic job at managing that
• 32:32
  Speaker 13: and drawing demand at the schools. Others need to be
• 32:35
  Speaker 13: careful and make sure they're not reenacting your experience calling
• 32:40
  Speaker 13: and students are rolling up to a trailer show.
• 32:42
  Speaker 10: Up on campus.
• 32:43
  Speaker 6: Yep, the mods as we call them.
• 32:45
  Speaker 4: Jeff Brown, founder and CEU of T two Capital Management,
• 32:47
  Speaker 4: thanks so much for joining us there.
• 32:51
  Speaker 2: You're listening to the Bloomberg Intelligence Podcast. Catch us live
• 32:55
  Speaker 2: weekdays at ten am Eastern.
• 32:56
  Speaker 3: On applecar Play and Ron Auto with the Bloomberg Business.
• 33:00
  Speaker 2: You can also listen live on Amazon Alexa from our
• 33:03
  Speaker 2: flagship New York station, Just Say Alexa playing Bloomberg eleven.
• 33:09
  Speaker 6: Mama Smith's sitting in for Alex Steele. I'm Paul Sweeney.
• 33:11
  Speaker 4: We're live here in our Bloomberg Interactive Broker Studio and
• 33:13
  Speaker 4: we are streaming live on youtubees ahead over YouTube dot
• 33:17
  Speaker 4: com search Bloomberg Podcast.
• 33:19
  Speaker 6: Every industry. I think everybody out there is trying to
• 33:21
  Speaker 6: figure out what.
• 33:22
  Speaker 4: Does the second Trump administration mean for my company, my industry,
• 33:27
  Speaker 4: you know, and that's certainly true of the energy space.
• 33:29
  Speaker 6: And my guess would be drill, baby, drill.
• 33:32
  Speaker 5: Two fo words out of my mouth.
• 33:34
  Speaker 7: There you go.
• 33:34
  Speaker 4: Let's talk to somebody who really thinks about this and
• 33:37
  Speaker 4: knows what he's talking about. Ty Lou Oil Market Specialists
• 33:40
  Speaker 4: for b n EF joining us here in our.
• 33:43
  Speaker 6: Bloomberg Interactive Broker Studio.
• 33:45
  Speaker 4: So Ty I would think that a second Trump administration
• 33:49
  Speaker 4: would be good for the energy space.
• 33:51
  Speaker 6: Is that fair assumption? How do you guys think about it?
• 33:53
  Speaker 1: Yeah, Hi Paul, thank you for having me. Yeah, definitely,
• 33:56
  Speaker 1: I think the USOL industry and the guess industry can
• 34:00
  Speaker 1: benefit from Trumpet administration in the number of ways. I
• 34:04
  Speaker 1: think the first half the BED is like a lower
• 34:06
  Speaker 1: corporate tax rate. So person see that Trump has mentioned
• 34:11
  Speaker 1: has indicated he would like to lower corporate tax rates
• 34:14
  Speaker 1: from the current twenty one percent to fifteen percent. So
• 34:17
  Speaker 1: if the materializes, that's the way of the BED. That's
• 34:19
  Speaker 1: like more money for the industry and for the shareholders.
• 34:22
  Speaker 5: What are they going to do with that money?
• 34:23
  Speaker 7: Then?
• 34:23
  Speaker 5: Are you suggesting it would be share buybacks or whatever?
• 34:26
  Speaker 1: Yeah, So there's definitely like a number of options these
• 34:29
  Speaker 1: companies can do with this quote unquote extreme money. They can,
• 34:33
  Speaker 1: like you said, they can do more buyback for the shares,
• 34:36
  Speaker 1: they can issue more dibid and payouts, they can reduce
• 34:39
  Speaker 1: the debt, and finally they can always they always have
• 34:41
  Speaker 1: the option to funnel some of these money into capital expenditures,
• 34:45
  Speaker 1: which ultimately retranslates into more production down the road.
• 34:50
  Speaker 4: How about from I mean from the regulatory standpoint, I mean,
• 34:53
  Speaker 4: can I go down there now and drill a well,
• 34:54
  Speaker 4: can I make a pipeline to take my natural guess
• 34:57
  Speaker 4: to corporate Christian wherever it needs to get to. Is
• 35:00
  Speaker 4: it going to be easier under a second Trump administration
• 35:04
  Speaker 4: to build energy stuff?
• 35:06
  Speaker 1: Yeah, I would definitely think so. So under the Barton administration,
• 35:09
  Speaker 1: that's the government has imposed a lot of regulations. There
• 35:13
  Speaker 1: are team that's unfriendly to the on gas industry. The
• 35:16
  Speaker 1: government is issued during rights moratorium they issued they placed
• 35:21
  Speaker 1: the pause on energy exports permits, and they also increase
• 35:26
  Speaker 1: royalties on federal land leases.
• 35:28
  Speaker 6: Uh.
• 35:28
  Speaker 1: And I would presume and all of these like we're
• 35:30
  Speaker 1: pretty hostile and created a lot of uncertainty to the industry.
• 35:34
  Speaker 1: So I would assume I would think that Trump administration
• 35:38
  Speaker 1: would remove a lot of these regulations. There are team
• 35:41
  Speaker 1: that's onwards to our gas producers. So definitely beneficial from
• 35:45
  Speaker 1: that point.
• 35:45
  Speaker 8: Of view you mentioned before, you know, increasing capex potentially
• 35:50
  Speaker 8: and how that would mean more production.
• 35:52
  Speaker 5: Gotta the worry about prices If.
• 35:54
  Speaker 8: You are producing so much more, what happens to the
• 35:56
  Speaker 8: supply demand equation? There is that already something that drillers
• 36:01
  Speaker 8: are thinking about of how much more they might want
• 36:03
  Speaker 8: to maybe not go in too much.
• 36:05
  Speaker 1: Yeah, that's for sure. So if you look at the
• 36:07
  Speaker 1: past ten years, use oil producers have on server occasions
• 36:12
  Speaker 1: crashed the AILL process when it decided to turn on
• 36:14
  Speaker 1: the production tabs. So they're very cognizange of the risks
• 36:17
  Speaker 1: this time around. On top of that, there's like a
• 36:19
  Speaker 1: lot of shareholder pressures on these oil and gas companies
• 36:22
  Speaker 1: to maintain capital discipline and to increase capital payback. So
• 36:26
  Speaker 1: from that sense, I think even though if there's like
• 36:28
  Speaker 1: more money to grow around in the industry, it would
• 36:31
  Speaker 1: be more much harder for the oil producers to grow
• 36:35
  Speaker 1: production the way they did in the past ten years.
• 36:39
  Speaker 4: So when did the US become a net exporter like
• 36:42
  Speaker 4: twenty sixteen or something like that, I think so, okay,
• 36:45
  Speaker 4: so we were a net importer forever, then we became
• 36:47
  Speaker 4: thanks to the shell finds, we became.
• 36:50
  Speaker 6: A net exporter.
• 36:52
  Speaker 4: How does the US oil industry, I'm not sure if
• 36:55
  Speaker 4: you can even characterize it or is it just individual companies.
• 36:57
  Speaker 4: How does the US oil industry interact with OPEK if
• 37:02
  Speaker 4: at all?
• 37:02
  Speaker 7: Yeah.
• 37:03
  Speaker 1: Yeah, So the way I think about that very competitive,
• 37:06
  Speaker 1: like natural competitors against each other. So if if lower
• 37:10
  Speaker 1: taxes in the Trump administration materializes, it would definitely make
• 37:14
  Speaker 1: the us O patch a lot more competitive. It will
• 37:17
  Speaker 1: also the brick given calculations there, and there would be
• 37:21
  Speaker 1: more money to grow around. So it would be it
• 37:23
  Speaker 1: will make it much harder for OPEC to increase the output,
• 37:26
  Speaker 1: so it's going to place OPACK on a more difficult grant.
• 37:31
  Speaker 8: You know, something that in part got Donald Trump reelected
• 37:35
  Speaker 8: to the White House was the idea of bringing prices down.
• 37:38
  Speaker 8: And you know, gas prices obviously a big sticking point
• 37:41
  Speaker 8: for a lot of Americans. Gas prices have been coming
• 37:44
  Speaker 8: down pretty consistently over the past you know, six months
• 37:48
  Speaker 8: or so, down to now like about roughly three dollars
• 37:52
  Speaker 8: a gallon on average nationwide.
• 37:54
  Speaker 5: What can Trump really do for gas prices?
• 37:58
  Speaker 1: Well, when I think about gas prin just there are
• 38:00
  Speaker 1: two pieces to it. That's the clude oil price part
• 38:03
  Speaker 1: and then the that's the refinery margin part. Now, on
• 38:06
  Speaker 1: the refinery margin, there's probably not much a person can
• 38:09
  Speaker 1: do to it because you basically have to increase refining
• 38:13
  Speaker 1: capacity and that takes years to build out. If you
• 38:15
  Speaker 1: want to pray for their part, the outer part would
• 38:17
  Speaker 1: be the all price part. Now, if you redo regulations
• 38:22
  Speaker 1: make it easier for companies to drew, you can pre rent. Theoretically,
• 38:26
  Speaker 1: you can prevent some of the possible price spikes in
• 38:29
  Speaker 1: all price in all prices, just because it's less onerous
• 38:34
  Speaker 1: for these jurists to put more capital into the ground.
• 38:37
  Speaker 1: So in this sense, you can help prices from seeing
• 38:40
  Speaker 1: more spikes. But however, I don't think these companies will
• 38:45
  Speaker 1: really go out and go all and endure again the
• 38:47
  Speaker 1: way they did before for the reasons we talked about before.
• 38:50
  Speaker 6: So what's happened to the Russian oil?
• 38:53
  Speaker 4: It's been a couple of years now, and if it's
• 38:56
  Speaker 4: not going to Germany, where's it going.
• 38:59
  Speaker 1: Yeah, so it's not going to the Western European nations,
• 39:02
  Speaker 1: and Western nations has placed sanctions on Russian oil. So
• 39:05
  Speaker 1: a lot of that has been brought up by unconstries
• 39:08
  Speaker 1: like India and China, so they're pretty really benefiting from
• 39:12
  Speaker 1: these sanctions.
• 39:13
  Speaker 6: So these sanctions aren't really working, are they.
• 39:15
  Speaker 1: They will be directing trade flow, the redirecting trade flow,
• 39:19
  Speaker 1: and they're making it harder for Russia to ship the
• 39:22
  Speaker 1: oils around the world. So it does increase the costs
• 39:26
  Speaker 1: on the Russian oil producers. So that's an impact, but
• 39:30
  Speaker 1: the impact I feel like it's probably more limited.
• 39:32
  Speaker 8: We do import some oil though, right it's not all
• 39:36
  Speaker 8: domestically produced, I mean, is that subject to tariffs?
• 39:40
  Speaker 1: I well, I think this morning Trump has indicated he
• 39:44
  Speaker 1: will accept where we do accept input out of oil
• 39:47
  Speaker 1: from Canada just because of the crewe grate that we
• 39:51
  Speaker 1: need in the golf coades. It's more fitting for Canadian
• 39:55
  Speaker 1: heavier crew dogs. And I think this morning he did
• 39:57
  Speaker 1: mention that he's going to exempt some of these crude
• 39:59
  Speaker 1: and natural gas US from Canada so he can really
• 40:02
  Speaker 1: like doing the very spigical race ways, even though if
• 40:05
  Speaker 1: he does in prokes on tariff's all right.
• 40:07
  Speaker 4: So I think the takeaway from this conversation is that
• 40:09
  Speaker 4: oil companies are going to make more money through lower.
• 40:11
  Speaker 5: Tax drill baby Trull.
• 40:13
  Speaker 4: Tyler, thank you so much for joining us, TYLERU oil
• 40:16
  Speaker 4: market Specialist bn EF.
• 40:18
  Speaker 6: I guess our friends down in like Houston, Texas, they're happy.
• 40:21
  Speaker 5: About this, Oh, I would think so yeah.
• 40:22
  Speaker 8: I mean, we did just have that big take the
• 40:24
  Speaker 8: other day about oil and gas being the most productive
• 40:27
  Speaker 8: US industry. How to think of like, you know, what
• 40:29
  Speaker 8: happens now you're just gonna ramp up the drills even more.
• 40:33
  Speaker 4: But they I mean, as you know, Tyler was mentioning
• 40:35
  Speaker 4: and other analysts have mentioned that these companies they have
• 40:37
  Speaker 4: financial discipline.
• 40:38
  Speaker 6: Now they don't just drill, that's right.
• 40:40
  Speaker 4: They return cash the shareholders and bond holders, unlike past
• 40:43
  Speaker 4: cycles were.
• 40:44
  Speaker 5: I was going to say, the twenty sixteen to eighteen years.
• 40:47
  Speaker 4: Yeah, so they've I guess they've learned their lesson more
• 40:50
  Speaker 4: helpful to their equity holders and their bondholders.
• 40:53
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• 40:58
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• 41:01
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• 41:09
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