Latest / Bloomberg Intelligence / Cars, Inflation, Credit Suisse, and Georgia Runoff (Podcast)

Transcript

Cars, Inflation, Credit Suisse, and Georgia Runoff (Podcast) · 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
0:06
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. All right, we've got
0:21
Speaker 1: a couple of smart folks here to talk cars, because
0:23
Speaker 1: there's a lot of I'm gonna let you literally drive
0:26
Speaker 1: this conversation. Kevin Tinnan, he's with Bloomberg Intelligence, he's been
0:29
Speaker 1: covering the auto industry for decades. And Elizabeth A. Bearman
0:33
Speaker 1: with Bloomberg News. Join us here. And Kevin, you're you know,
0:37
Speaker 1: you're internal combustion engine kind of guy. Have you have
0:42
Speaker 1: you bought off on this the whole move to e
0:46
Speaker 1: V Is that really where the industry is going? Would
0:49
Speaker 1: you spend your own money on a hybrid? Kevin? Well,
0:52
Speaker 1: here's the thing, right Like, so I'm a car guy
0:55
Speaker 1: and I'm a profit guy, So so you know that
0:59
Speaker 1: that's the thing. People will hear me speak in my
1:03
Speaker 1: presentations and get this idea that I'm anti e V
1:06
Speaker 1: and it's really not the case. It's just hey and Matt,
1:09
Speaker 1: you know this, right, fast as fast, and a good
1:12
Speaker 1: car is a good car, and reliable is reliable and
1:14
Speaker 1: all that stuff. And I'm fine with all that. I'm
1:17
Speaker 1: just saying that adoption, uh doesn't really happen because of
1:22
Speaker 1: the supply side of the equation. When the automakers look
1:26
Speaker 1: at their p and L. Right, it's basically as simple
1:29
Speaker 1: as that. And you have places China, Europe where the
1:33
Speaker 1: government is a little bit more involved driving that that
1:36
Speaker 1: transition a little bit faster than it here is than
1:39
Speaker 1: it is here in the US. Well, and you can
1:41
Speaker 1: see that the automakers just haven't brought out all the
1:43
Speaker 1: electric models that they easily could have. Right, take a
1:47
Speaker 1: look at Forward, for example, the one electric Paul which
1:50
Speaker 1: drove it is awesome, but they don't have an electric expedition.
1:54
Speaker 1: They don't have an electric excursion, and they don't have
1:56
Speaker 1: an electric explorer. Is because they don't nobody wants them.
2:00
Speaker 1: Obviously they could. They could easily have made all of
2:03
Speaker 1: those cars battery electric vehicles, but they didn't. And I
2:06
Speaker 1: don't mean nobody wants them, but there's just not the
2:09
Speaker 1: kind of adoption yet that they're even in Germany. Elizabeth
2:13
Speaker 1: Berman joining us from Munich, right, she covers um the
2:16
Speaker 1: auto industry across Europe for US. But that's where BMW is,
2:20
Speaker 1: and they haven't made uh you know, fully electric X
2:23
Speaker 1: five yet. They haven't electrified their whole fleet, even though
2:26
Speaker 1: they've gone further, Elizabeth, than I'd say most of the
2:29
Speaker 1: producers on the continent have. Yeah, absolutely. I mean I
2:33
Speaker 1: would also say, from where you're all sitting, which is
2:35
Speaker 1: namely in the US, I think it's easy to have
2:38
Speaker 1: a different point of view than from over here, where
2:41
Speaker 1: you know, every other car in certain city centers is
2:44
Speaker 1: by now electric, and even plug in hybrids continue to
2:48
Speaker 1: sail very well. There was an interesting note out today
2:52
Speaker 1: from barclay'st that was actually talking about BMW and how
2:56
Speaker 1: their electric cars actually doing really really well in terms
3:00
Speaker 1: of profitability compared to their combatant engine cars, which is
3:03
Speaker 1: really important. It is a very different market, right. I
3:07
Speaker 1: drove to Ohio for Thanksgiving, um with my wife who
3:12
Speaker 1: is from Spain. For me, a ten hour drive is normal,
3:16
Speaker 1: right for her, that's like going from Spain to Poland, right, So, um,
3:22
Speaker 1: you know, Europeans just don't make drives that but that's
3:24
Speaker 1: a Pennsylvania cha long though. Yeah, it was, Well, there
3:27
Speaker 1: are good trains over here and the and you have
3:29
Speaker 1: fantastic trains, and um, I feel like the infrastructure is
3:33
Speaker 1: even better. Right if I can find an electric charger
3:37
Speaker 1: any parking spot in Berlin or Munich, it's not that
3:40
Speaker 1: easy over again again, you know, it's Europe is more
3:43
Speaker 1: densely populated that many many parts of the U S
3:45
Speaker 1: which is a big difference. And then there's also differences
3:48
Speaker 1: in taste that you were just talking about the f
3:50
Speaker 1: one fifty, which is one of the most popular cars
3:53
Speaker 1: in the US, and that kind of a car doesn't
3:56
Speaker 1: really exist over here, right, no place the market I mean,
3:59
Speaker 1: so kevity I fitted through the roads. If if there
4:01
Speaker 1: were a room there, they would love them just as
4:04
Speaker 1: much as we do, right you know. And that's a
4:06
Speaker 1: that's a perfect point, is that even before electrification. Um,
4:11
Speaker 1: you know, US automakers had a hard difficult time really
4:15
Speaker 1: penetrating that European market, right because it was you know,
4:19
Speaker 1: if you're a global automaker, you want to be sharing
4:21
Speaker 1: platforms and parts and nameplates and the whole thing. Um,
4:24
Speaker 1: what we what we prefer here are infrastructure is just
4:30
Speaker 1: completely different. So you had our domestic automakers trying to
4:34
Speaker 1: make small vehicles which were unprofitable and unpopular here for
4:40
Speaker 1: that market, and it just, you know, essentially wound up
4:43
Speaker 1: pulling out altogether in terms of we can't do that profitably.
4:47
Speaker 1: We're not going to try and compete with uh, that
4:50
Speaker 1: those European automakers in their backyard, and and we're just
4:55
Speaker 1: gonna do what we do, which is um the preference
4:58
Speaker 1: here in the US bigger try. So obviously different regions
5:02
Speaker 1: have different tastes, but we've all seen the same same
5:05
Speaker 1: trends in terms of pricing and supply chains. Right, Um,
5:09
Speaker 1: the Europeans have had just as difficult a time getting
5:11
Speaker 1: chips as US automakers have, and use cars. Use car
5:15
Speaker 1: prices were off the charts last year or this year.
5:18
Speaker 1: I guess I'm already on both sides of the Atlantic.
5:22
Speaker 1: Is that changing, Kevin? Do you see pricing really getting softer?
5:27
Speaker 1: It'll get softer from those peaks. But I think structurally
5:32
Speaker 1: automakers look and I think everybody looks at the volume
5:36
Speaker 1: line and says, oh, this is decreasing or this is declining,
5:41
Speaker 1: And I think you have to layer in that price
5:43
Speaker 1: power and margin power over it and look at the
5:46
Speaker 1: revenue pool and say it's actually growing, so fewer units
5:50
Speaker 1: but much higher transaction prices, which is better for the manufacturers.
5:55
Speaker 1: I think we look at it from the consumers point
5:57
Speaker 1: of view that well, I can't I can't get a
5:59
Speaker 1: twenty five thousand dollar Cooper Sedan anymore. You know, I'm
6:03
Speaker 1: all forty forty five thousand small suv or midsize suv.
6:07
Speaker 1: And that's where the automaker wants us to live. That's
6:11
Speaker 1: that's orchestrated. That's not by accident. Your point on the chips,
6:14
Speaker 1: If I have a finite number of chips, well I'm
6:17
Speaker 1: going to put them in my bigger, more expensive, wider
6:19
Speaker 1: margin vehicles. Hey, Elizabeth, in Europe, what are the European
6:24
Speaker 1: auto manufacturers saying about their expectations for demand? I mean,
6:28
Speaker 1: you know, with a recession backdrop, with the continued to
6:32
Speaker 1: war in Ukraine, what are you hearing from far from
6:35
Speaker 1: the European automakers. Yeah, I mean, just apart from the
6:39
Speaker 1: supply chain issues that Kevin was just addressing, the automakers
6:42
Speaker 1: over here have a number of other factors to deal
6:46
Speaker 1: with namely inflation that's even higher than than elsewhere UM
6:52
Speaker 1: and UH. There's a lot of push pool and a
6:55
Speaker 1: lot of absence of actual firm UM firm forecasts for
7:00
Speaker 1: next year, which tells you just how cloudy the picture is.
7:04
Speaker 1: But what I would say is that because of the
7:06
Speaker 1: supply chain issues that we've had, but because of the
7:09
Speaker 1: scarcity of parts, there's a lot of pent up demand
7:12
Speaker 1: that car makers are still working down, which by some
7:16
Speaker 1: estimates will take them at least into the middle of
7:19
Speaker 1: next year and protect them from any consumers pulling back
7:23
Speaker 1: as a result of having to fork out so much
7:25
Speaker 1: more to pay for the energy builds. Yeah, and we
7:28
Speaker 1: saw JP Morgan come out today upgrading the Tesco supplier,
7:32
Speaker 1: placing Pirelli on positive catalyst watch, reiterating overweights on Valio
7:37
Speaker 1: and Farrisia and Scheffler UM. So more and more analysts
7:43
Speaker 1: are coming out with bullish calls. Are not only the manufacturers,
7:47
Speaker 1: but also the UM UH, the suppliers that Elizabeth covers
7:51
Speaker 1: as well. Great stuff, Kevin Tynan, Bloomberg Intelligence, thanks so
7:54
Speaker 1: much for joining us. Elizabeth Berriman from blom Bloomberg Bloomberg
7:57
Speaker 1: News in Munich, Germany, giving us a great perspective of
8:01
Speaker 1: kind of what she's seeing from some of the European automakers.
8:04
Speaker 1: But evs it is here, folks, get ready for this transition.
8:08
Speaker 1: It is happening, uh, and it is something that the
8:10
Speaker 1: automakers are making a big, hard pivot to and we
8:13
Speaker 1: will continue to have full coverage there. Now I want
8:20
Speaker 1: to get to Ben Emmons. He's in the studio with us,
8:23
Speaker 1: which is great, and he is now the head of
8:25
Speaker 1: fixed income and macro at New Edge Wealth. So it's
8:28
Speaker 1: a new position um for Ben after Um, well, he
8:32
Speaker 1: was at Medley last but he spent years at Pimco
8:35
Speaker 1: as well. Um after being at a bank and at
8:39
Speaker 1: usc which won't be in the playoffs they will not know,
8:43
Speaker 1: but Ohio State University will be in Michigan. Yeah, we'll
8:47
Speaker 1: get a sweet rematch in any case. Ben, great having
8:49
Speaker 1: you in in the studio. Talk to us about your
8:52
Speaker 1: new role. What are you doing at New Edge, Hey,
8:54
Speaker 1: Matt Paul, thank you, it's a great feedback. Um. Yeah,
8:57
Speaker 1: at New Edge, I'm involved in fixteen come, which is
9:00
Speaker 1: kind of my expertise. So I had a fixed income
9:03
Speaker 1: portfolio management. It's also multi asset. New actually is a
9:08
Speaker 1: new wealth management from mostly came out of ubs UM.
9:12
Speaker 1: It focuses on ultra high net worth individuals, entrepreneurs maybe
9:17
Speaker 1: somewhat commonly known as ou our wealth management firms. Half
9:20
Speaker 1: there's those institutional managements. So that's all my expertise comes
9:24
Speaker 1: in there. It will be domestic fixed income, global fixing income,
9:26
Speaker 1: multi asset, so go anywhere. Global macro will be still
9:30
Speaker 1: very strong. But we count on your notes, We count
9:32
Speaker 1: on your research that we get. We'll still get those.
9:38
Speaker 1: It's deep, it's worth reading, and it comes out quickly
9:41
Speaker 1: after events, so you'll still be able to produce that. Yes,
9:44
Speaker 1: for sure, it's very time. What did you What did
9:47
Speaker 1: you make of the job's number on Friday? Because it
9:49
Speaker 1: strikes me that this market is off today, um because
9:54
Speaker 1: of that job's number and because of feed expectations when
9:58
Speaker 1: we weren't off on fri Day after the actual data.
10:02
Speaker 1: I don't get why, although the initial reaction was that
10:06
Speaker 1: we jumped at least and yields, which made a lot
10:08
Speaker 1: of sense. Of course, you know what I did. I
10:10
Speaker 1: did a very simple regression. I used jold Stata claims,
10:13
Speaker 1: I s M employment data. Um. You know the other
10:17
Speaker 1: kind of leading indictions from from employment and just put
10:19
Speaker 1: them in a in a multi regression against bay rolls
10:22
Speaker 1: and it spit out. A high phenomena was predicted. And
10:26
Speaker 1: I looked at the history of the regression, although the
10:28
Speaker 1: big standard era, but the huge spikes in there, and
10:30
Speaker 1: each time that that spike happened, the pair ronoma came
10:33
Speaker 1: out and did stronger. So it showed to me that
10:36
Speaker 1: there's huge momentum still in the labor market. Maybe I'm
10:38
Speaker 1: the example of it, I said, moving quick through another job.
10:42
Speaker 1: So it told me like, yes, there's a weakling of
10:45
Speaker 1: the economy. I didn't see what the I M. Services
10:47
Speaker 1: was today. Probably maybe softer, but there's not like a
10:51
Speaker 1: labor market recession. There's maybe a housing market recession or
10:54
Speaker 1: rule decline, but labor markets are strong. So you should
10:58
Speaker 1: be seeing this two y yield closer to where the
11:00
Speaker 1: fifth phones rate is going to be next week, you know,
11:03
Speaker 1: between four and a quarter to file four and a half.
11:06
Speaker 1: It should put some pressure on the stock markets, but
11:08
Speaker 1: it should give us a comfort of were not intercession
11:10
Speaker 1: as we speak. So I'm with Neil. Data from Renaisson's
11:13
Speaker 1: macro happen to be kind now staying on there, Neil,
11:17
Speaker 1: good job, because he's right. I mean, this is actually
11:19
Speaker 1: an economy that's not week it's actually continues to be resiling.
11:22
Speaker 1: So we had the services number was good by the way, yea,
11:25
Speaker 1: it came to smidge better services at fifty six and
11:28
Speaker 1: a half. We were looking fifty for fifty three point
11:30
Speaker 1: five and it's better than the fifty four point where
11:33
Speaker 1: we got last month, right exactly, So some good numbers there,
11:36
Speaker 1: so Ben. We had the gentleman on from a portfolio
11:39
Speaker 1: manager on from Pimco last week, and the Pimco's historically
11:43
Speaker 1: been I think over the last several years very bearish,
11:45
Speaker 1: and they've been right. He started getting a little bit
11:48
Speaker 1: more twank yeah uh, and you know, and now they
11:52
Speaker 1: got a little bit more bullish. There is it a
11:55
Speaker 1: time to go into and maybe scale up a fixed
11:58
Speaker 1: income portfolio? Yeah you could. I mean I think we're
12:02
Speaker 1: so the analysis is from from them and from other
12:05
Speaker 1: perfolio managers. Yields are absolute level are high, so that
12:09
Speaker 1: is appealing obviously, but then you have to keep in
12:12
Speaker 1: mind that the inflation has not fully changed yet. The
12:15
Speaker 1: COREPC number was somewhat moderate, but not enough I think
12:19
Speaker 1: to say, well you can be full all in for
12:22
Speaker 1: duration that is um. But what it does show is
12:25
Speaker 1: that we've gotten to restrictive rate levels, so it put
12:28
Speaker 1: spressure on the economy. For fixed income. That means that
12:31
Speaker 1: you you can be you know, scale in as you say,
12:35
Speaker 1: buy some duration, getting some corporate credit, stay still high
12:38
Speaker 1: quality because if there is a recession, credits perssipal widen.
12:42
Speaker 1: That's commonly assumed. But the duration is I think the
12:46
Speaker 1: most important trade here that I personally like the front
12:49
Speaker 1: end of the U curve because if the FAT is
12:50
Speaker 1: moving to this restrictive rate, that could become overtightening that
12:54
Speaker 1: may look like that. Then I think the one the
12:57
Speaker 1: five year part of the U curve is extremely attractive.
12:59
Speaker 1: If anything, as the FED moves to a slower pace,
13:02
Speaker 1: and it's more clear about this message, even the volatility
13:05
Speaker 1: of the short short maturity knows what the kind, so
13:08
Speaker 1: it'll give you the better risk adjustive return. On the
13:11
Speaker 1: front of the curves, I would favor it are where
13:14
Speaker 1: do you see, I mean, what happens to like a
13:17
Speaker 1: ten yere yield. Right now we're at three fifty UM.
13:21
Speaker 1: If the FED goes to five let's say they go
13:24
Speaker 1: to five five and a half. UM five is not
13:27
Speaker 1: a stretch, right, that's just another couple of fifty basis
13:30
Speaker 1: point hikes. But um does it make sense to have
13:33
Speaker 1: I mean, historically would you see treasuries that far under
13:37
Speaker 1: the federal funds rate? Yeah? So I think think about
13:41
Speaker 1: the yelk of in this way. Right, So the inversion
13:43
Speaker 1: currently is about really restrictive fat policy, That's what it's pricing.
13:48
Speaker 1: It's not about an uncertain economy. Then the entire yuker
13:51
Speaker 1: will be flat. All rates would be the same. So
13:53
Speaker 1: if you think about this three and a half or
13:55
Speaker 1: change of the tenure that should go to five, that
13:59
Speaker 1: actually means that only that there will be maybe I
14:01
Speaker 1: guess more surprises and fat policy, faster hikes, more aggression,
14:05
Speaker 1: but also you end up in an economy that will
14:07
Speaker 1: be so uncertain that that we don't know where we're
14:09
Speaker 1: heading with having two high rates. So that doesn't seem
14:12
Speaker 1: to be the case. The loan occurs seems to be sickling.
14:14
Speaker 1: More about this is a restrictive enough policy, it will
14:18
Speaker 1: get in facient at least start trending down. It may
14:21
Speaker 1: not get the two percent, but at least start really
14:22
Speaker 1: consistently trending down. Therefore it should stay below the fat
14:26
Speaker 1: pronds rate RESUD. The two year coming on should be
14:29
Speaker 1: where the fat puns rate comes out at. It's interesting
14:31
Speaker 1: that the two year current is already trading for where
14:33
Speaker 1: the fat pronds rate will be next week, actually cannon below.
14:37
Speaker 1: So it's already saying that the market is or the
14:39
Speaker 1: entire termsy market saying yeah, fat, you're probably getting an
14:42
Speaker 1: overtightening zone if you will. Your message nine on the
14:45
Speaker 1: Bloomberg terminal says the next big trade China full reopening.
14:49
Speaker 1: What's your call there? It is a pool reopening. I'd
14:52
Speaker 1: be very very on that team, um, you know to Actually,
14:56
Speaker 1: my prior colleague, Brian Jackson is at net least great
14:59
Speaker 1: analysts madly he you know, he and I talked a
15:03
Speaker 1: lot about like this implicit message from from China has
15:06
Speaker 1: been about trying to curb this virus strictly with these
15:09
Speaker 1: really shorter lockdowns. But then you do reopen that again quick.
15:13
Speaker 1: It's not like we're reading in March of twenty a
15:16
Speaker 1: couple of weeks lockdown. So so and again, I think
15:19
Speaker 1: the change that really happened a number of weeks ago,
15:22
Speaker 1: allowing foreign flights to come in giving them access to
15:25
Speaker 1: biontic fisor vaccine for foreigners to come in. That is
15:29
Speaker 1: a deal that they made in twenty There's a larger
15:31
Speaker 1: stockball behind it that maybe use eventually for China too.
15:35
Speaker 1: But that's the first step to open your borders. The
15:37
Speaker 1: second step, of course, is to open production again. China
15:41
Speaker 1: doesn't want to get to an economy that's at at
15:43
Speaker 1: three once again, economy at least five percent. So I've
15:47
Speaker 1: just been on that framework saying this is an economy
15:50
Speaker 1: that is going to fully reopen. I think that's the
15:52
Speaker 1: big trade next year. And that does mean a lot
15:54
Speaker 1: for commodities, right and for auto market. So you can
15:56
Speaker 1: kind of see coming through since the protest broke out,
16:00
Speaker 1: Come on you good stuff all right, Ben Emmons, thank
16:02
Speaker 1: you so much for joining us here. Ben Emmons, he's
16:05
Speaker 1: principal senior portfolio management had a fixed income in macro
16:08
Speaker 1: at New Edge Wealth New We should explain the message nine,
16:11
Speaker 1: by the way, for those of you without a Bloomberg terminal,
16:15
Speaker 1: it's like you know when you had your A I
16:17
Speaker 1: Am Away message. That's what the message nine is. Okay,
16:21
Speaker 1: So we got that out there and it says the
16:23
Speaker 1: next big trade. All right, let's talk banks. My former
16:29
Speaker 1: one of my one of my many former employers, Credit
16:31
Speaker 1: Swiss First Boston. The First Boston thing is coming back, kids,
16:36
Speaker 1: We're bringing back the gang. Alison Williams sees the senior
16:39
Speaker 1: Global banks UH analyst for Bloomberg Intelligence. You joined us
16:43
Speaker 1: on the phone here. So, Allison, I've got Credit Swiss
16:46
Speaker 1: the parent in Switzerland. I'm think I'm gonna have a
16:49
Speaker 1: Credit Swiss First Boston kind of entity in the US.
16:53
Speaker 1: And I've got Saudi Arabia investing some money. Can you
16:56
Speaker 1: explain what's going on with our good friends? Fast Studies
16:59
Speaker 1: are taking a so I al think of us kind
17:03
Speaker 1: of what we need to know. So UH, Credit Sweez
17:06
Speaker 1: is restructuring, which they announced at the end of October.
17:11
Speaker 1: They're they're taking those steps which continue evolve. One is
17:14
Speaker 1: the raising of capital, which has been going on over
17:17
Speaker 1: the past couple of weeks. We've seen some UM pressure
17:21
Speaker 1: in the shares related to that, as well as a
17:23
Speaker 1: trading update given by the bank. But from a practical
17:27
Speaker 1: UM point of view, you know, to other things that
17:29
Speaker 1: they're doing, one of which is to UM get external
17:33
Speaker 1: investors for the Securitized Products group, which they are spinning
17:37
Speaker 1: out to um Apollo as as the key um UM
17:42
Speaker 1: investor there, and then credit sweets First Boston. As you said,
17:46
Speaker 1: they're rebranding the part of the business that really focuses
17:50
Speaker 1: on the underwriting and m and a UM portion UM
17:55
Speaker 1: and uh, you know, bringing bringing back management there as
17:58
Speaker 1: well as the name and uh they're going to be
18:02
Speaker 1: spinning that off. There's sort of no details on how
18:04
Speaker 1: that's going to evolve. What we are getting UM in
18:07
Speaker 1: dribs and drabs different UM investors that are interested in
18:10
Speaker 1: that was part of the news today. Have anything I
18:13
Speaker 1: can bring back all my credits was first Boston swag
18:16
Speaker 1: that I have, like my golf shirts, my my hoodies,
18:19
Speaker 1: my bad's good news. Yes, But Allison, have any UM
18:23
Speaker 1: potential investors been allegedly directly responsible for the live dismemberment
18:30
Speaker 1: of a journalist. I mean, I don't want to seem insensitive,
18:33
Speaker 1: but it seems like no one's talking about this. Can
18:35
Speaker 1: you really work for an investment bank if a murderer
18:39
Speaker 1: is one of the big main investors. I mean, I'm
18:44
Speaker 1: I'm I'm certainly not going to get into the politics
18:48
Speaker 1: of the investment UM. You know, I think that the
18:52
Speaker 1: difficulty with the credit sweez UM and and to your point,
18:56
Speaker 1: there have been a lot of talk about sort of
18:58
Speaker 1: where the money is coming from. That's that's going into
19:00
Speaker 1: the bank UM. But for the bank UM, you know,
19:04
Speaker 1: the key thing is to study and find some investors
19:08
Speaker 1: and you know, maybe it's not UM. You know, maybe
19:13
Speaker 1: it's not the targeted people that they would like UM.
19:17
Speaker 1: So it's good that there is economic interest, but to
19:21
Speaker 1: your point, they do have to think about sort of
19:23
Speaker 1: where the money is coming from. How about is there
19:25
Speaker 1: a snare here where the US arm this credit Swiss
19:29
Speaker 1: fers Boston, where they spin it out into the public markets. Allison,
19:34
Speaker 1: I think that is where they're headed, and they're just
19:37
Speaker 1: really looking for I think some some anchor investors into
19:40
Speaker 1: into the unit UM. But the intention seems to be
19:46
Speaker 1: eventually it will be spun off into the public but
19:48
Speaker 1: there's no details on timing or what that would look like.
19:53
Speaker 1: So in Switzerland, in Zurich or where they bayed Zerch
19:56
Speaker 1: or Geneva um Zurich, Okay, so in Zurich, are is
20:01
Speaker 1: the plan here to really just focus the remaining credit suite,
20:05
Speaker 1: primarily slest solely on the private wealth management it is.
20:10
Speaker 1: It is getting to UM, you know, ubs and credit suites.
20:16
Speaker 1: If we look at these banks, you know, over a
20:18
Speaker 1: long period of time, the wealth business is really the
20:20
Speaker 1: business that most investors are interested in because it's highly
20:25
Speaker 1: it tends to be like highly revenue recurring UM, high
20:29
Speaker 1: returns on investment and credit suites UM. Throughout some of
20:35
Speaker 1: the pressures that they've had, UM, you know, sort of
20:37
Speaker 1: coming to the four with some of the risk management issues,
20:40
Speaker 1: but also on a fundamental basis UM from some of
20:43
Speaker 1: these businesses, such as the securitized product unit. They are
20:47
Speaker 1: looking to really focus their efforts on the wealth business
20:52
Speaker 1: and then you know, spinning off these other businesses into
20:55
Speaker 1: these sort of more creative solutions. All Right, It's interesting
21:00
Speaker 1: to see, UM, you know, how this story is evolving.
21:04
Speaker 1: It does seem like, you know, there were questions, UM,
21:07
Speaker 1: existential questions about credit Suez. Are we beyond that. I
21:11
Speaker 1: think that you know that the capital raising is close
21:15
Speaker 1: to being done, and I think once that's done, UM,
21:18
Speaker 1: there there can be some studying. Anytime a bank comes
21:22
Speaker 1: out and says that they intend to raise capital, UM,
21:26
Speaker 1: it's always gonna be hard for the for the shares
21:28
Speaker 1: to study there's always going to be a lot of
21:29
Speaker 1: ability to volatility until um that's complete. As you can
21:33
Speaker 1: imagine when they had come out and and and and two.
21:37
Speaker 1: When it comes out that there the offering price is
21:40
Speaker 1: at such a significant discount UM, you know, that tends
21:44
Speaker 1: to have an impact in terms of the um trading
21:49
Speaker 1: prices of the shares, as you can imagine. And so
21:51
Speaker 1: I think as once that is done, I think that
21:55
Speaker 1: provides some some studying. The trading or the profit loss
22:01
Speaker 1: that they're going to experience in the fourth quarter is
22:03
Speaker 1: sort of significant, So it sort of takes away from
22:06
Speaker 1: the from the shoring of the capital that they're doing
22:08
Speaker 1: with this deal. UM. But I think you know, your
22:11
Speaker 1: your question is more around like are we going to
22:13
Speaker 1: see things steady? We are just a question of how
22:16
Speaker 1: long it's going to take for things to revalue to
22:19
Speaker 1: the upside. Alison just about thirty seconds left. Talk to
22:22
Speaker 1: us about the new credit Swiss first, Boston. Is this
22:24
Speaker 1: going to be a boutique type of thing, like a
22:25
Speaker 1: Lazard or or Green Hill or something along those lines.
22:29
Speaker 1: I mean, it sort of looks like it's it's aimed
22:31
Speaker 1: that way in terms of focusing on the banking I
22:34
Speaker 1: think what it does for the UM bankers and what
22:38
Speaker 1: it does for the company is similar to what we've
22:41
Speaker 1: seen UM with a lot of these boutique M and
22:44
Speaker 1: A spinoffs, Right, so people can more of an eat
22:47
Speaker 1: what you kill, and the bankers economics are purely focused
22:50
Speaker 1: on deals, and that incents the bankers to want to
22:55
Speaker 1: work in an environment like that and allows for the
22:58
Speaker 1: compensation to be more directly related. All right, that's good stuff,
23:01
Speaker 1: and it'll be UH. The CEO will be Michael Klein,
23:04
Speaker 1: who I know back for my days at Solomon Smith Barney.
23:07
Speaker 1: He is a serious player on Wall Street Global UH dealmaker,
23:11
Speaker 1: deep ties in the Middle East, and I think we've
23:13
Speaker 1: seen that evidence with the Saudi UH investment. Alison Williams,
23:16
Speaker 1: thank you so much for joining us. Alison Williams, she's
23:19
Speaker 1: the senior banks analyst for Bloomberg Intelligence. She's been covered
23:22
Speaker 1: in the banks for decades. You want to get right
23:28
Speaker 1: to our next guest, Matt Winkler. He's the founder of
23:30
Speaker 1: Bloomberg News. He does some other stuff, but that's kind
23:31
Speaker 1: of the highlight right there, because I want to get
23:33
Speaker 1: right to his UH opinion Colm today, which is this
23:36
Speaker 1: really interesting talks about the energy companies, and they've been
23:39
Speaker 1: one of the sectors that has actually benefited this year
23:41
Speaker 1: when all other stocks and bonds and things like that
23:44
Speaker 1: are down, the energy stocks have done great. Why because
23:46
Speaker 1: oil prices are higher in part due to what's going
23:49
Speaker 1: on in Ukraine. Matt, thanks so much for joining us here,
23:52
Speaker 1: uh in our Bloomberg Interactor Broker studio. UM, your your
23:56
Speaker 1: comms entitled Biden is right to question oil stock bybe x.
24:01
Speaker 1: What's the story here, mat? Okay, So we all know
24:03
Speaker 1: that Russia invaded Ukraine in February, and we all know
24:07
Speaker 1: that the price of oil went up dramatically, that the
24:12
Speaker 1: price of gasoline at the pump, UH fetched a record
24:16
Speaker 1: I think five dollars average price in June. And during
24:22
Speaker 1: that period, oil companies in the US UM increased their
24:27
Speaker 1: buy backs over you know, a four week period of
24:30
Speaker 1: four quarter period, excuse me, more than a thousand percent.
24:34
Speaker 1: So what does that mean. It means that the oil
24:37
Speaker 1: companies were getting more cash from their business faster than
24:42
Speaker 1: they could spend it or invested, and they were charging
24:47
Speaker 1: the highest prices at the retail level for gasoline at
24:52
Speaker 1: the lowest cost. So, if you believe in democracy, and
24:56
Speaker 1: if you believe that free market capitalism is a direct
25:00
Speaker 1: efficiary of democracy, then you have to ask the question,
25:03
Speaker 1: why should the oil companies treat the invasion of Ukraine,
25:07
Speaker 1: the destruction of human life, water, electricity, you know, everything
25:13
Speaker 1: that we value in a democracy. Why should they be
25:16
Speaker 1: allowed to benefit from that without acknowledging that they have
25:22
Speaker 1: some loyalty to democracy. Do you suggest that they should
25:25
Speaker 1: do well? Or what Biden? What Biden said was, look, Uh,
25:30
Speaker 1: you could increase production. You know, we were releasing oil
25:35
Speaker 1: from the reserves. Uh. Production is actually less today than
25:39
Speaker 1: it was in two thousand nineteen, about nine less. So
25:43
Speaker 1: he was saying, at a minimum, instead of just taking
25:46
Speaker 1: all this cash that you suddenly have and using it
25:49
Speaker 1: to buy back your shares and increase your dividends, you
25:52
Speaker 1: could have increased some production. Uh, and responded that you
25:58
Speaker 1: actually have incentives out there for us not to do that.
26:01
Speaker 1: Talked to uh, sorry, we talked to oil executives quite
26:04
Speaker 1: a bit and always ask why they don't invest more
26:06
Speaker 1: And the answer is always um that this administration is
26:12
Speaker 1: not friendly UM to that business. And you see it,
26:16
Speaker 1: of course when UM CEO is go in front of Congress,
26:20
Speaker 1: for example, when banks CEOs went in front of Congress
26:22
Speaker 1: and they were in so much trouble for funding the
26:25
Speaker 1: oil business. Um, and that's just funding it, right, So
26:28
Speaker 1: the direct so so, Matt, let me put it this way.
26:33
Speaker 1: Oil company profits, buybacks, dividends highest in our century. Okay,
26:41
Speaker 1: we're twenty two years into the century, and you actually
26:44
Speaker 1: have to go back to find a period where the
26:48
Speaker 1: large s that we're talking about is as great it
26:51
Speaker 1: is now. So it's kind of hard to have some
26:54
Speaker 1: sympathy even if the oil companies are pushing back and saying,
26:58
Speaker 1: you know, we're not getting supported. They've been supported all
27:02
Speaker 1: the way through the twenty first century. The proof is
27:06
Speaker 1: their bottom line, and their bottom line is as fat
27:09
Speaker 1: and green as it gets. And so the question becomes,
27:14
Speaker 1: just like in the nineteen forties, when other dictators were
27:18
Speaker 1: rampaging through Europe, okay and threatening democracy here in the
27:22
Speaker 1: United States, should we at least acknowledge that and do
27:26
Speaker 1: something about it, because ultimately, we're all Americans, and it
27:29
Speaker 1: doesn't matter where what ideological spectrum you come from, We're
27:33
Speaker 1: all Americans and we all value democracy. So that the
27:38
Speaker 1: question is what can the oil companies do differently now?
27:41
Speaker 1: Other than investing in new production, because you say Biden's
27:44
Speaker 1: concern is that they're exploiting the current. They could easily
27:48
Speaker 1: have lowered the price at the pump or put pressure
27:52
Speaker 1: on That's something that they could have an influence on,
27:55
Speaker 1: and they didn't. Okay, there was no reason why Americans
27:59
Speaker 1: had to pay the eighes price on record still much
28:02
Speaker 1: lower than people pay for gasoline in other countries, though,
28:05
Speaker 1: you know, I mean I I just came from Germany,
28:07
Speaker 1: where we were paying seven dollars a gall so when
28:09
Speaker 1: I hear people crying about that, But go back to Germany,
28:12
Speaker 1: and what did they do in Germany? First of all,
28:14
Speaker 1: the governments and the oil companies didn't protest, said Okay,
28:17
Speaker 1: we're gonna take some of your profits, windfall profits, and
28:21
Speaker 1: we're gonna make sure that the people who are suffering
28:24
Speaker 1: the most get some of that benefit. And the oil
28:27
Speaker 1: companies in Europe where you just were, said we don't
28:29
Speaker 1: have a problem with that, And the British government just
28:32
Speaker 1: did that. By the way, following the lead of European governments.
28:35
Speaker 1: You have nothing like that in the United States. Now
28:38
Speaker 1: in Europe, they really are sensitive to Ukraine because it
28:41
Speaker 1: is in Europe. It's right on the border, so they
28:44
Speaker 1: know what it means to lose your democracy, and so
28:48
Speaker 1: the commitment there is much greater because of the sensitivity
28:52
Speaker 1: of democracy at risk than it is here. But the
28:55
Speaker 1: oil companies here could do exactly what has been the
28:59
Speaker 1: behavior else where. Should there be some type of windfall
29:02
Speaker 1: tax on some of these it's not unreasonable because these
29:06
Speaker 1: are abnormal times. That's when you impose extraordinary measures. And
29:12
Speaker 1: if we do value democracy, you'd like to think we do. Um,
29:17
Speaker 1: there's nothing unreasonable about this, particularly since you folks every
29:21
Speaker 1: day we're complaining about the high price of gasoline. Back
29:24
Speaker 1: in June, and you were making that Biden's fault. I mean,
29:28
Speaker 1: you didn't give us a parenthetical clause or context that said, oh,
29:32
Speaker 1: this has nothing to do with Biden, which it really didn't.
29:35
Speaker 1: You just said, well, he's the president, he should be blamed,
29:38
Speaker 1: and prevailing media narrative was it's his fault. Okay, But
29:42
Speaker 1: Americans are actually smarter than that, which is what we
29:46
Speaker 1: learned on election Day just a few weeks ago. I mean,
29:49
Speaker 1: I don't think we never blamed President Biden for the
29:52
Speaker 1: market prices higher, right, but he was contain media, he
29:57
Speaker 1: was the convenient. Okay, Uh, if you like person to
30:02
Speaker 1: blame and did get blamed. What are the energy companies
30:05
Speaker 1: saying here today? Are they just is there simple responses?
30:08
Speaker 1: This is just the market. I mean, oil is it
30:10
Speaker 1: wherever it is and there's no refining capacity out there.
30:13
Speaker 1: So even if we pumped more oil. Absolutely, it's the indifference.
30:17
Speaker 1: It's the indifference to massive suffering throughout Europe. It's the
30:21
Speaker 1: indifference to suffering in Ukraine, the absence of even talking
30:24
Speaker 1: about it. Um, you know, people have literally lost their
30:29
Speaker 1: livelihoods and uh, it's happening every day and this, this
30:35
Speaker 1: dictator is getting away with it. And so do we
30:37
Speaker 1: want to be a party to that? Do we want
30:39
Speaker 1: to acknowledge that we are benefiting from that? And the
30:42
Speaker 1: answer should be no. And as Congress said, anything here
30:46
Speaker 1: at you know, I'm sure the congressman that Congress folks
30:50
Speaker 1: that are supportive of the energy industry don't want any
30:53
Speaker 1: part of this. But has there been any movement within
30:55
Speaker 1: Congress and say, hey, maybe we should think about something
30:58
Speaker 1: like a war windfall tax or just a production bill
31:01
Speaker 1: that says, hey, you know, there's a war going on
31:04
Speaker 1: and we need to make sure we're not, or do
31:06
Speaker 1: we need to get into it a little bit deeper
31:08
Speaker 1: the US because that's what happened in World War Two.
31:13
Speaker 1: Having the historical perspective would really help the discussion enormously,
31:18
Speaker 1: because out of the depression that preceded World War Two
31:24
Speaker 1: came UH the post World War two boom, and the
31:28
Speaker 1: ascendants of the United States has unquestionably the number one
31:31
Speaker 1: economy in the world, which it has held ever since
31:34
Speaker 1: that time. And you know that was born out of,
31:38
Speaker 1: if you will, Americans coming together in a way that
31:42
Speaker 1: they hadn't up until that point. And it was for
31:44
Speaker 1: the right reason. It was to defend democracy and create,
31:48
Speaker 1: as Roosevelt said in Arsenal, for democracy. And it doesn't
31:52
Speaker 1: feel like we're there in this well, no, it's it's
31:53
Speaker 1: even reversed, right because the GOP, the sort of Marjorie
31:56
Speaker 1: Taylor Greens of the world, are already against giving any
31:59
Speaker 1: kind of UM financial aid, even just financial aid to Ukraine.
32:04
Speaker 1: So yes, uh, we who are so fortunate uh to
32:10
Speaker 1: benefit uh from our wonderful free market capitalism should understand
32:17
Speaker 1: that it comes at uh a cost, and the cost
32:22
Speaker 1: is our democracy. All right, Matt, great stuff. As always,
32:26
Speaker 1: you can catch Matt column on Bloomberg dot Com, Slash
32:30
Speaker 1: Opinion or O P I n go. Matt Winkler's editor
32:33
Speaker 1: in chief emeritus Bloomberg News. Founded Bloomberg News a couple
32:37
Speaker 1: of moons ago. Uh, and he's got his calm talking
32:39
Speaker 1: about the energy industry and wrote the style of book
32:42
Speaker 1: by which I Live, You Live Bike. We were talking
32:44
Speaker 1: about me every day. Matt. On another mistake I've made
32:47
Speaker 1: style wise, well, you just put infinity y L go
32:50
Speaker 1: into I don't think split infinitives are in the style book.
32:53
Speaker 1: I'm just personally against them. Okay, good stuff, all right?
32:55
Speaker 1: Looking at oil right here, w T I crude oil,
32:57
Speaker 1: and we were higher up at eighty two and change
33:00
Speaker 1: now back below eighty dollars seventy nine dollars twenty nine
33:03
Speaker 1: cents on w T I crewed brent eighty five dollars
33:06
Speaker 1: and can I go to the Paul Sweeney Personal Inflation Index, Matt,
33:10
Speaker 1: you like to look at regular unleaded gasoline, and I know,
33:13
Speaker 1: I know so, but it it's you know, it's it's
33:15
Speaker 1: been coming down, so I like to quote it. We're
33:17
Speaker 1: here at three dollars and forty cents a gallon. How
33:20
Speaker 1: about that I say, it's nowhere there in North Jersey.
33:22
Speaker 1: I'll tell you that. In some of it's like three seventy.
33:24
Speaker 1: The guys are giving me a thirty cent tax just
33:26
Speaker 1: for living there, I guess, but we'll see. But we've
33:28
Speaker 1: got energy prices pulling back here a little bit, along
33:31
Speaker 1: with some of the other commodities. All right, Well, this
33:36
Speaker 1: Senate runoff race down in Georgia, it is uh, you know,
33:40
Speaker 1: we're at the finish line here and it is neck
33:42
Speaker 1: and neck as far as I can tell. But obviously, yeah,
33:45
Speaker 1: they're gonna head of the polls tomorrow, so that I'll
33:47
Speaker 1: be interesting to see how that plays out because and
33:49
Speaker 1: I think almost two million people have voted already. Yeah,
33:52
Speaker 1: so that's the thing that early voting. Um, it's a
33:55
Speaker 1: big deal down there. It's a big deal. So we're
33:56
Speaker 1: gonna do a podcast on it. The Big Take podcast
33:59
Speaker 1: is going to focus on this issue. Welcome West Kasova.
34:03
Speaker 1: He's the host for Bloomberg's The Big Take podcast. So, West,
34:06
Speaker 1: how are you guys approaching what is turning out to
34:08
Speaker 1: be a you know, neck and neck race down in Georgia. Yeah,
34:12
Speaker 1: it has been quite the race, and it's a little
34:15
Speaker 1: bit of Dejabu because you remember the last time everything
34:18
Speaker 1: came down to Georgia the control of the Senate. This
34:21
Speaker 1: time we know that the Democrats have already gotten control
34:24
Speaker 1: of the Senate. And so what we're talking about is,
34:27
Speaker 1: if we already know Democrats have the Senate, why is
34:29
Speaker 1: everyone so obsessed with this race? Like why does one
34:33
Speaker 1: more potential vote for Democrats matter? Or if Republicans get
34:37
Speaker 1: it doesn't really change the balance. So why is everyone
34:39
Speaker 1: so obsessed with this race? Well, because of the way
34:44
Speaker 1: Congress has been, right, I mean, you need an extra
34:49
Speaker 1: Democrat or two if if they want to do anything,
34:51
Speaker 1: as we uh saw in the last of course the
34:54
Speaker 1: last couple of years, they if you get one or
34:56
Speaker 1: two of them going rogue, it messes up everything, all right,
35:00
Speaker 1: So there you go. We should have been on the show. Um,
35:03
Speaker 1: that's exactly. There's two like really interesting things. One is, Um,
35:08
Speaker 1: if you remember the last few a couple of years,
35:11
Speaker 1: Joe Mansion, Democrat from West Virginia, managed to really tie
35:15
Speaker 1: up Joe Biden's agenda just one senator and um, it's
35:19
Speaker 1: it's easier for one senator to kind of go rogue,
35:23
Speaker 1: um and hold things up much harder if um, you know,
35:27
Speaker 1: you have to have two senators to do that, and
35:29
Speaker 1: so just that one extra vote can really mean the
35:34
Speaker 1: difference if you have one senator who's kind of crossing
35:37
Speaker 1: zone and singing now. And then the other big thing
35:41
Speaker 1: is committees. This is like kind of deep into the
35:43
Speaker 1: guts of how the Senate works. Is if you have
35:45
Speaker 1: a fifty fifty Senate with the tie type being broken
35:48
Speaker 1: by Kamala Harris, Vice President, the committee assignment and what
35:52
Speaker 1: the committees do and what they investigate is, we know
35:55
Speaker 1: that's a big deal. Is much harder if it's fifty
35:58
Speaker 1: the Democrats. Democrats have one more than the chairmanships and
36:02
Speaker 1: all that kind of stuff that decides what the Senate
36:05
Speaker 1: does completely changes. So it's interesting less. I mean, it
36:09
Speaker 1: just this feels like it maybe you look at Georgia
36:12
Speaker 1: and it could be a little bit of a a
36:13
Speaker 1: litmus test for Donald Trump and his thoughts about because
36:17
Speaker 1: the it's kind of breaking down along those lines in Georgia. Yeah,
36:22
Speaker 1: that's another really good point. We talked about that on
36:24
Speaker 1: the show UM today too, because you know, Donald Trump
36:28
Speaker 1: really bad herschell Walker. He backed a whole lot of candidates,
36:31
Speaker 1: a lot of them lost. That's one of the reasons
36:33
Speaker 1: why Republicans are kind of a great Donald Trump because
36:36
Speaker 1: he nominated some kind of out there candidates and voters
36:39
Speaker 1: didn't like him. And this could be that last test.
36:41
Speaker 1: Herschel Walker endorsed by Donald Trump. Um, if he loses,
36:46
Speaker 1: it's kind of yet another bit of evidence for Republicans
36:49
Speaker 1: to wonder. I don't know, maybe we'd go with Ryan Standards,
36:52
Speaker 1: the governor of Florida, or somebody else of the next
36:54
Speaker 1: time around. It just seems I mean, isn't herschel Walker
37:00
Speaker 1: claiming that he didn't even pay for his girlfriend's abortion?
37:03
Speaker 1: I know some people say that there is a check
37:06
Speaker 1: um that proves he did, But it's kind of like
37:09
Speaker 1: Mike Damone and Fast Times Ridgemont High. If you get
37:11
Speaker 1: your girlfriend pregnant, then you don't even pay for her abortion.
37:14
Speaker 1: Doesn't that rubbed voters the wrong way? Well, this has
37:19
Speaker 1: been a pretty big issue. I mean, you know, so
37:21
Speaker 1: herschel Walker, yes, he denies that any of this happened. Um,
37:26
Speaker 1: and he's the one claiming to be pro life. Robael Warner,
37:29
Speaker 1: who's a minister uh is uh is saying, you know,
37:36
Speaker 1: bringing this up, uh, And it's an interesting thing that
37:39
Speaker 1: a lot of evangelical voters are siding with Walker even
37:43
Speaker 1: though he has this kind of problem and he's trying
37:46
Speaker 1: to explain, uh, and it just gets into how complicated
37:50
Speaker 1: American politics are. It just seems like he looks so bad, right,
37:54
Speaker 1: because whether you're four or against abortion, we probably all
37:58
Speaker 1: agree you should show up with a check um, you know,
38:02
Speaker 1: instead of leaving your girlfriend high and dry and making
38:04
Speaker 1: her pay for it herself and then h On the
38:08
Speaker 1: other side, there can be no greater star power in
38:12
Speaker 1: American politics than Barack Obama. He shows up two stomp
38:18
Speaker 1: for warnock, isn't that enough to swing like everybody in Georgia, Well,
38:25
Speaker 1: it depends on who they are. In a lot of
38:27
Speaker 1: parts in Georgia, Barack Obama is the problem, not the solution.
38:31
Speaker 1: You know, like a lot of Southern states, a lot
38:32
Speaker 1: of other states. In cities like Atlanta, they tend to
38:36
Speaker 1: be uh more Democratic, but in the suburban areas and
38:39
Speaker 1: especially in the rural areas, they tend to be more Republican.
38:43
Speaker 1: You know, So Barack Obama showing up definitely gets Democrats
38:46
Speaker 1: out there. What's interesting is on the Republican side, they
38:49
Speaker 1: pretty much told Donald Trump, please don't come here and
38:53
Speaker 1: campaigned for herschel Walker because you're not going to help
38:56
Speaker 1: so well, Democrats are very happy to have one former
38:59
Speaker 1: press and to show up. Republicans really don't want their
39:02
Speaker 1: former residents there, right, And it's isn't it all about
39:05
Speaker 1: the swing voters? I mean, obviously Republicans are not going
39:08
Speaker 1: to vote for Warnock, and clearly Democrats are not going
39:11
Speaker 1: to vote for herschel Walker. But the swing voters make
39:15
Speaker 1: the difference, don't they? Yeah, they do. And and Georgia
39:19
Speaker 1: is a really interesting state because you know, they're in
39:22
Speaker 1: the whole left swing voters left, Like we've seen this.
39:24
Speaker 1: Presidential races are just anybody, it's the margins. So most
39:27
Speaker 1: people have made up their minds, but in a state
39:29
Speaker 1: like Georgia, you're still like a big question. Is Georgia
39:32
Speaker 1: a red state or is there what they call it
39:34
Speaker 1: purple state? You know, it's kind of like it it
39:36
Speaker 1: goes a little bit this way and a little bit
39:38
Speaker 1: of that way, depending who the candidates are. And so
39:40
Speaker 1: if herschel Walker wins, then it looks pretty pretty much
39:44
Speaker 1: like Georgia is a red state because Walker has not
39:48
Speaker 1: been a very attractive candidate to a lot of people.
39:50
Speaker 1: Even some Republicans underperformed. Um the governor who you know, Kemp,
39:56
Speaker 1: who won very very well, He got many fewer voters,
39:59
Speaker 1: which shows you that dumb Republicans voted for Camp to
40:02
Speaker 1: be governor, voted you know, either didn't vote for Walker
40:06
Speaker 1: or voted for Warnuck. So if war Nick the Democrat
40:10
Speaker 1: is able to win, then like Georgia is the state
40:13
Speaker 1: that you were gonna really be watching, is possibly voting
40:17
Speaker 1: for the Democrat. All right, what's good stuff? We appreciate that. Westcasova.
40:21
Speaker 1: He's the host of Bloomberg's Big Take podcast. You can
40:25
Speaker 1: get that wherever you get your podcasts. And uh uh
40:28
Speaker 1: this week they're looking at the Senate race. Uh, the
40:31
Speaker 1: you know, kind of the walk off. If you will,
40:35
Speaker 1: thanks for listening to the Bloomberg Markets podcast. You can
40:38
Speaker 1: subscribe and listen to interviews with Apple Podcasts or whatever
40:42
Speaker 1: podcast platform you prefer. I'm Matt Miller. I'm on Twitter
40:46
Speaker 1: at Matt Miller three. On fal Sweeney, I'm on Twitter
40:50
Speaker 1: at pt Sweeney. Before the podcast, you can always catch
40:53
Speaker 1: us worldwide at Bloomberg Radio