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TCW's Landmann: Good Time To Get Exposure If 10Yr UST Hits 2%, · 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
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  Speaker 1: with essential market moving news. Find the Bloomberg Markets Podcast
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  Speaker 1: on Apple Podcasts or wherever you listen to podcasts, and
• 0:18
  Speaker 1: at Bloomberg dot com slash podcast. Now, I'm looking at
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  Speaker 1: the ten year yield here one point seven one. There's
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  Speaker 1: a lot of folks out there saying, hey, by year endy,
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  Speaker 1: you need to be thinking about a two percent ten uere,
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  Speaker 1: maybe even at two and a quarter percent tenure. Uh
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  Speaker 1: in you know, the question is, you know, in the space,
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  Speaker 1: in the face of what we're seeing is there's tremendous
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  Speaker 1: physical stimulus looks like it's coming down the pipe with
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  Speaker 1: President Biden's plan. Really, where do rates go? Let's check
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  Speaker 1: in with Laird Landman. He's a co director for fixed
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  Speaker 1: income at tc W. Little firm out in Los Angeles
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  Speaker 1: for about two thirty five billion with a B and
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  Speaker 1: assets under management. Laird, thanks so much for joining us here.
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  Speaker 1: Love to get your your thoughts here. We had a
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  Speaker 1: few weeks ago the tenure spiked one point six percent.
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  Speaker 1: That got people's attention. We've drifted higher here. What's your
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  Speaker 1: view of kind of where you think, uh, these treasury
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  Speaker 1: rates go. Well, certainly we seem to be biased to
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  Speaker 1: going higher here, but I do think we're reaching levels
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  Speaker 1: as we approach two percent, where it's probably a reasonable
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  Speaker 1: point you're thinking about getting exposure uh to rates if
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  Speaker 1: you think about the amount of debt that we're going
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  Speaker 1: to be issuing, which is I think pretty topical today
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  Speaker 1: as we talked about, you know, how this plan will
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  Speaker 1: be financed, the Biden spending plan. Um, there certainly will
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  Speaker 1: be I think a desire to keep rates low uh
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  Speaker 1: in the US because you're gonna have to pay for
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  Speaker 1: this over many many years. So if there's that demand
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  Speaker 1: out there, what's been happening in the seven year auctions
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  Speaker 1: this month and last month, Well, I don't think there's
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  Speaker 1: a demand for the rates. You're seeing foreign investors pulled back.
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  Speaker 1: I think the demand right now is being filled by
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  Speaker 1: the central banks. What I was suggesting was that I
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  Speaker 1: do think that rates will hit a point around two percent,
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  Speaker 1: maybe a little bit above that, where you're gonna be
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  Speaker 1: want to want to get exposure to them because over
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  Speaker 1: the long term. If you believe our central bank, if
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  Speaker 1: you believe they're not going to overreact to short term
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  Speaker 1: spikes uh in inflation numbers uh. And that's an I UM,
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  Speaker 1: then I think you probably look at the long term
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  Speaker 1: and those will be pretty good long term value. Do
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  Speaker 1: you believe them? Do I believe them? Uh? I think
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  Speaker 1: that they're going to have a real, real difficult time
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  Speaker 1: reversing this policy. I mean, we're living today in a
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  Speaker 1: world that is the mirror image of there's excessive access
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  Speaker 1: reserves around, and we're seeing that reflected in repo rates
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  Speaker 1: and short term rates. I think a hundred and five
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  Speaker 1: billion dollars roughly was parked today in the FEDS reverse
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  Speaker 1: repo program at earning a whopping zero percent um. And
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  Speaker 1: you might remember when they tried to taper, what you
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  Speaker 1: had was the exact opposite. You had excess reserves going down,
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  Speaker 1: you had repro rate spiking in the marketplace. So I
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  Speaker 1: think they have a great deal of difficulty, despite their rhetoric,
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  Speaker 1: in reversing this policy. So I do tend to believe
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  Speaker 1: that they're gonna They're gonna keep QUI going uh, and
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  Speaker 1: they're probably going to keep rates low even if you
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  Speaker 1: do see, uh, these supply um channel issues which are
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  Speaker 1: going to be exacerbated by the Biden plan most likely
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  Speaker 1: raise CPI numbers in the short term. All right, Larry, Larry,
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  Speaker 1: if you do think, um, the Fed wants to keep
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  Speaker 1: rates lower for longer, where are you and your teams
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  Speaker 1: at TCW spending your time now looking for opportunities? Well,
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  Speaker 1: we've been short on the duration side in terms of
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  Speaker 1: our interest rate exposure for quite a while. Um, we've
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  Speaker 1: been gradually as rates have gone up, cost averaging our
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  Speaker 1: durations higher, which is part of our our fundamental value
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  Speaker 1: based philosophy. So uh, if you if you if you
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  Speaker 1: don't like something at one cent, when it gets to
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  Speaker 1: two percent, you might like it a little bit more. Um. Likewise, Uh,
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  Speaker 1: the Federal Reserve is generating what I would describe as
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  Speaker 1: a bit of a free lunch in the forward market
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  Speaker 1: for mortgages, the t b A market h so TCW
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  Speaker 1: has found great value there. You're picking up anywhere from
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  Speaker 1: seventy to a hundred basis points of additional yield by
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  Speaker 1: rolling keb as right now. And that's really generated by
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  Speaker 1: that arbitrage is generated by the Federal reserves. Desire to
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  Speaker 1: continue to buy mortgages over time. So we saw this
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  Speaker 1: in q E one, we saw it in QUE two, UH,
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  Speaker 1: and so why not in QUI wherever we are today, UH,
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  Speaker 1: continue to take that free lunch that they're providing. Does
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  Speaker 1: QUI continue on forever? Well? I don't think it continues
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  Speaker 1: on forever, But I think that the Central Bank, as
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  Speaker 1: I said, is going to have a great deal of trouble. Uh.
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  Speaker 1: You know, I think about the ship in this US
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  Speaker 1: canal in terms of trying to turn around. I think
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  Speaker 1: you have a lot of trouble freeing this barge uh
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  Speaker 1: from the sand uh in turning it around. So I
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  Speaker 1: think that this is going to exist for quite a while.
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  Speaker 1: The FED believes that the lessons that they learned from
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  Speaker 1: the past programs is they didn't go big enough for
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  Speaker 1: long enough. So I think, you know, if you believe
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  Speaker 1: that that was their conclusion, um, you have to believe
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  Speaker 1: that this is going to continue into next year. So
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  Speaker 1: I think for the foreseeable future, this is one of
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  Speaker 1: the most attractive trades out there. He learn Let me
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  Speaker 1: about thirty seconds here, love to get your thoughts on
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  Speaker 1: credit quality as you look out across the vast portfolio
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  Speaker 1: Trust Company of the West. Are we seeing cracks in
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  Speaker 1: credit quality? It doesn't appear to be. No. I think
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  Speaker 1: in this environment where the markets are wide open and
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  Speaker 1: you can bring as many spacks as you want an
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  Speaker 1: issue equity, um, I think it's hard to see the
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  Speaker 1: cracks developing. There's certainly the foundation for those cracks to
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  Speaker 1: develop is occurring with the over leveraging that's that's going on.
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  Speaker 1: But you know, our our our our corporate team is
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  Speaker 1: describing this is right now. We're in the dash for
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  Speaker 1: trash phase. So everyone's just trying to buy as much oldest,
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  Speaker 1: say Kennon, and ignore credit quality. And so this is
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  Speaker 1: a time when prudent investors want to start being becoming
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  Speaker 1: a little bit a little bit careful. All right, great
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  Speaker 1: insight from you, Laird, and I hope we can get
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  Speaker 1: you back on the program again because it's been wonderful
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  Speaker 1: talking to you. Laird Landman is the co director for
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  Speaker 1: Fixed Income at the Trust Company of the West. At
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  Speaker 1: tc W A I would say, a famed name in
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  Speaker 1: terms of fixed income. So it's great to hear from impol. Yeah,
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  Speaker 1: when you go at to Los Angeles to visit investors,
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  Speaker 1: as I did, for close to thirty years. Capital Group
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  Speaker 1: and tc W are your anchor meetings. Those are the
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  Speaker 1: ones you got to see. Absolutely cool then that we
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  Speaker 1: get to talk to him, and I was bringing Nathan
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  Speaker 1: chet He is the chief economist and head of macro
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  Speaker 1: research for PGIM fixed Income. They have basically a trillion
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  Speaker 1: dollars under management. But he also served as the Under
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  Speaker 1: Secretary of the U. S. Treasury for International Affairs under
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  Speaker 1: President Obama. So basically, um, he has the chops to talk. Uh.
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  Speaker 1: This Iiden's spending plan. Nathan, thanks so much for joining us.
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  Speaker 1: What do you think about the two point to five
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  Speaker 1: trillion dollar plan? Is it enough? Well? I think it
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  Speaker 1: is a significant step forward. What's clear is that the
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  Speaker 1: country has a very substantial infrastructure by deficit that over
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  Speaker 1: uh the last let's say ten or fifteen years, there's
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  Speaker 1: been broad agreement amongst Republicans and Democrats that we needed
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  Speaker 1: to do more on infrastructure, but they just weren't able
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  Speaker 1: to find a formula to get it done. And it
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  Speaker 1: looks like that the Joe Biden, notwithstanding is very narrow
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  Speaker 1: majorities in Congress, is finding a formula and uh putting
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  Speaker 1: forward a significant package, whether it goes all the way
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  Speaker 1: to addressing our infrastructure needs. I doubt it, but it's
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  Speaker 1: certainly a significant step forward. So two point two five trillion,
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  Speaker 1: We've we've heard numbers that were even higher than that,
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  Speaker 1: but again, this seems to be a number that maybe
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  Speaker 1: you can get some support here, Nathan, What is this
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  Speaker 1: a fiscal stimulus of this magnitude? What does it mean
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  Speaker 1: for your economic outlook? So? I think an important point
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  Speaker 1: to bear in mind is that, unlike the stimulus that
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  Speaker 1: was passed earlier this year at one point nine trillion,
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  Speaker 1: this two and a quarter trillion is likely to be
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  Speaker 1: phased quite evenly over a number of years. The estimates
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  Speaker 1: I've heard is UH up to up to eight years.
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  Speaker 1: So it's a more gradual kind of effect on the
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  Speaker 1: demand side. Now, if a program like this works, it
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  Speaker 1: will have a little bit of lift on demand, but
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  Speaker 1: it should also help make the supply side of the
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  Speaker 1: economy more efficient and could UH could have UH some
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  Speaker 1: imprint in terms of raising potential growth and UH the
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  Speaker 1: economy's capacity to be able to produce. So it is
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  Speaker 1: an eight year plan. Six and twenty billion goes to transportation,
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  Speaker 1: SID fifty billion for clean water, high speed broadband, things
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  Speaker 1: that make your life easier at home or safer acceptedly
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  Speaker 1: safe billion for American manufacturing, of which a hundred eighty
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  Speaker 1: billion UH is said to be the biggest non defense
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  Speaker 1: research and development program on record, and four hundred billion
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  Speaker 1: to go for more care to the elderly and the disabled.
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  Speaker 1: What's next, what's left to do? Nathan? Well, my sense
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  Speaker 1: is that there will be likely another package that the
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  Speaker 1: administration is going to put forward that is going to
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  Speaker 1: be more focused on uh, domestic spending, more social kind
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  Speaker 1: of Paul, let's see, and I think there were likely
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  Speaker 1: to see a focus on education, on childcare, and other
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  Speaker 1: other kinds of spending, perhaps healthcare as well, that the
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  Speaker 1: administration will view as important steps in investing in people
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  Speaker 1: and helping to make the population more productive. So I
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  Speaker 1: think that that is that's the next the next chapter
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  Speaker 1: in what Biden is likely to be announcing. All Right, Nathan,
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  Speaker 1: somebody's got to pay for all these spending programs, as
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  Speaker 1: Matches laid out. Talk to us about the the tax
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  Speaker 1: policy of the tax potential changes in tax policy of
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  Speaker 1: the Biden administration. Well, I think the tax side of
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  Speaker 1: this is likely to be extremely controversial. First of all,
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  Speaker 1: Mitch McConnell and the Republicans have made clear that they
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  Speaker 1: will not vote for any tax increases. So to the
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  Speaker 1: extent that the tax increases are included, and I think
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  Speaker 1: they will be, it means that Democrats are going to
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  Speaker 1: have to do it on their own and via reconciliation. Now,
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  Speaker 1: I think within the Democratic Party, a increase in the
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  Speaker 1: corporate tax rate from twenty one percent. Maybe they won't
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  Speaker 1: get all the way to twenty eight percent, but maybe
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  Speaker 1: twenty is something that Democrats will will sign on to.
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  Speaker 1: Nathan later, Nathan, as someone who worked in government, why
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  Speaker 1: can't they just try to shut loopholes and get rid
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  Speaker 1: of deductions? I mean, everybody says the answer is lawyers
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  Speaker 1: and lobbyists. Why not go after that and try and
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  Speaker 1: get more money out of you know, what we already
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  Speaker 1: should be paying. I think that there are broadly speaking,
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  Speaker 1: two ways to do that, and I think that uh
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  Speaker 1: various proposals from the Biden administration are likely to pursue
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  Speaker 1: both of them. One is to improve the quality of
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  Speaker 1: enforcement of our existing tax laws. So are people dodging
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  Speaker 1: the expectations of what's already on the books, and they're
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  Speaker 1: allocating they will allocate likely substantial sums UH to support
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  Speaker 1: the I R S in its in its enforcement efforts.
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  Speaker 1: The second is to address some of these loopholes that
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  Speaker 1: are perceived as unfair, and I think that we will
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  Speaker 1: see them take those steps. And those are also measures
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  Speaker 1: that will be quite popular amongst Democrats and frankly amongst
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  Speaker 1: some Republicans as well. Right, hey, Nathan, thanks so much
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  Speaker 1: for joining us here. We really appreciate your thoughts. Nathan Sheets,
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  Speaker 1: chief economists at Teaching Fixed Income based in Newark, New Jersey,
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  Speaker 1: giving us his thoughts on what's likely to be a
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  Speaker 1: two point two five trillion dollar fiscal stimulus plan to
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  Speaker 1: be announced today. Probably President uh Biden focusing on infrastructure
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  Speaker 1: is going to be the big issue. Matt. It's not
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  Speaker 1: just simply cash into individual's pockets to deal with a pandemic.
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  Speaker 1: This is something that is a longer term, forward thinking
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  Speaker 1: pandemic or fiscal stimulus aimed at infrastructure. I this morning
• 13:17
  Speaker 1: in our Bloomberg pantry here in the office, I picked
• 13:20
  Speaker 1: up a package of shocks bio Cannabis Power brand granola bars. Now, yeah,
• 13:28
  Speaker 1: I haven't eaten them yet, but they don't have actual
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  Speaker 1: THC and them. I love to go back, and they're not.
• 13:36
  Speaker 1: Really it's not amsterdamn You're in Berlin, not amer That's right,
• 13:38
  Speaker 1: I'm in Berlin. It's not legal here. I mean, cops
• 13:42
  Speaker 1: turn the other way if you're smoking a joint in
• 13:44
  Speaker 1: the park, I've heard. But in New York soon you
• 13:48
  Speaker 1: will be able to, I guess, smoke a joint in
• 13:50
  Speaker 1: the park and get cannabis power granola bars that really
• 13:53
  Speaker 1: have th HC in them. Kisha Clukey joins us New
• 13:56
  Speaker 1: York correspondent for Bloomberg Government out of Albany because the
• 13:59
  Speaker 1: govern in her has just signed the weed bill. Keisha, Yes, yes,
• 14:04
  Speaker 1: it's a it's official. Uh is coming to New York State.
• 14:07
  Speaker 1: We're going to be the second largest market in the
• 14:10
  Speaker 1: nation for legal marijuana. Alright, Keisha, what's the I'm sure
• 14:14
  Speaker 1: there was an economic argument. We're Bloomberg here, we think money,
• 14:18
  Speaker 1: we think markets. What's the economic argument for legalizing marijuana
• 14:22
  Speaker 1: at the state level. Yeah, and and of course the
• 14:26
  Speaker 1: argument is is intertwined with a whole bunch of things,
• 14:29
  Speaker 1: you know, criminal justice issues as well. Um, but this
• 14:32
  Speaker 1: is looking to bring in about three fifty million dollars
• 14:35
  Speaker 1: a year once it's fully rolled out in just packed
• 14:38
  Speaker 1: revenue for the state, and then on top of that,
• 14:41
  Speaker 1: UM the total amount of four point two billion dollars
• 14:44
  Speaker 1: in sales is the projection once it's fully fully rolled out,
• 14:48
  Speaker 1: as well as tens of thousands of jobs. So I
• 14:51
  Speaker 1: was recently chatting with a credit trader here on the
• 14:55
  Speaker 1: Bloomberg terminal who estimates about of his adult friends smoke
• 14:59
  Speaker 1: weed or you know, eat gummies or whatever. Do you
• 15:03
  Speaker 1: really think, Keisha, that that many people use THHC products? Yeah, yes,
• 15:10
  Speaker 1: I think so. I mean, we already have medical marijuana
• 15:12
  Speaker 1: in the state, and this legislation expands the medical marijuana program,
• 15:17
  Speaker 1: and it also allows for home grow UM. And then
• 15:20
  Speaker 1: it has this other side to it, which is the
• 15:22
  Speaker 1: recreational side. And I think there's been a lot of
• 15:24
  Speaker 1: study showing people from New York State going to the
• 15:28
  Speaker 1: states surrounding us. Uh, you know, Massachusetts is very popular
• 15:32
  Speaker 1: to get these products. So now we're keeping the money
• 15:35
  Speaker 1: for ourselves, or we will once it's rolled out. So
• 15:39
  Speaker 1: what's the sense of time in Kisha. I'm here in
• 15:41
  Speaker 1: New Jersey and the New Jersey legalized UM marijuana months ago,
• 15:47
  Speaker 1: but I don't think it's even available yet. I'm just
• 15:49
  Speaker 1: not sure the timing here. Do we have any sense
• 15:51
  Speaker 1: of when we're gonna see you know, smoke shops and
• 15:55
  Speaker 1: edible cafes, you know on Broadway on. I mean a
• 16:00
  Speaker 1: lot is gonna depend on the regulations. They still have
• 16:03
  Speaker 1: to set up the Office of Cannabis and a Cannabis
• 16:05
  Speaker 1: Board to talk about licensing and figure out how many
• 16:09
  Speaker 1: dispensaries will be allowed, where they would be located. UM.
• 16:12
  Speaker 1: The lawmakers, of course New York is very competitive, especially
• 16:16
  Speaker 1: with New Jersey, and they're saying, we can walk and
• 16:19
  Speaker 1: chew gum at the same time. Let's have it up
• 16:21
  Speaker 1: by next year. So they're hoping to have the first
• 16:24
  Speaker 1: licenses out by at some point in two although, of
• 16:28
  Speaker 1: course again that depends on on how fast they get
• 16:30
  Speaker 1: these regulations in place. So what about farming, I mean,
• 16:34
  Speaker 1: I assume that we're not getting all this stuff from
• 16:36
  Speaker 1: Humble County on the other side of the country. UM,
• 16:40
  Speaker 1: it's not being flown in from Jamaica. Are they gonna
• 16:43
  Speaker 1: Are there gonna be big weed farms um in western
• 16:47
  Speaker 1: New York. UM that could be a potential UM. The
• 16:52
  Speaker 1: legislation provides for um AID to help farmers, start up
• 16:56
  Speaker 1: businesses I suppose to be canvas growers and station in
• 17:00
  Speaker 1: the state. They're really excited. A lot of farms already
• 17:03
  Speaker 1: have hence farming and produce DBD products, so they're already
• 17:07
  Speaker 1: in a position to not only plant these uh, these
• 17:11
  Speaker 1: weed plants, but also you know, get them out the
• 17:14
  Speaker 1: door and get them to processing plants or processing them
• 17:17
  Speaker 1: themselves so that they can get them to distributors. Kisha,
• 17:21
  Speaker 1: how much what kind of support did this have up
• 17:24
  Speaker 1: in Albany? Was a bipartisan support? Was it? You know,
• 17:27
  Speaker 1: along party lines? How broad is the support for this? Well,
• 17:32
  Speaker 1: it's been a long time in the making. Um, I
• 17:34
  Speaker 1: think one lawmaker isn't pushing it for eight years. So um,
• 17:38
  Speaker 1: over the years, it's it's gained some support. And the
• 17:41
  Speaker 1: final deal did end up passing in the state legislature
• 17:44
  Speaker 1: very late last night, a largely along party lines, although
• 17:47
  Speaker 1: there were some Democrats who sided um with the Republicans
• 17:51
  Speaker 1: against the bill. UM. And then their concerns were, you know,
• 17:55
  Speaker 1: operating machinery under the influence that work UM issues really
• 18:00
  Speaker 1: it into driving and traffic stacy and there's a lot
• 18:02
  Speaker 1: that still need yeah, yeah, exactly, And also you know,
• 18:08
  Speaker 1: how can you tell whether or not someone is under
• 18:11
  Speaker 1: the influence um immediately while driving? Did they smoke you know,
• 18:15
  Speaker 1: days before, was it right before? Was it while they
• 18:18
  Speaker 1: were driving? Um? So there's gonna be a lot of
• 18:20
  Speaker 1: these details that will work out. This is just the
• 18:22
  Speaker 1: basic framework for the legislation. All right, Keisha, thank you
• 18:27
  Speaker 1: so much. We appreciate that, Kisha Kluky for Bloomberg giving
• 18:32
  Speaker 1: us her sense here of the law that just signed
• 18:35
  Speaker 1: into or signed into law legalizing marijuana in the state
• 18:41
  Speaker 1: of New York. That's big for the industry. I saw
• 18:47
  Speaker 1: a story cross the Terminal earlier about Fiser's vaccine Paul,
• 18:53
  Speaker 1: which says that teens who take it and I guess
• 18:56
  Speaker 1: twelve to fifteen is the age range here, it was
• 18:59
  Speaker 1: a hundred percent effective in a final stage trial. That's
• 19:03
  Speaker 1: a big number. This is huge, Uh, you know, Matt,
• 19:06
  Speaker 1: because I've been saying, you know, I'm all, I'm all psite.
• 19:09
  Speaker 1: I got my first shot last weekend. I'm gonna get
• 19:11
  Speaker 1: my second one in a few weeks, and you know,
• 19:12
  Speaker 1: and and vaccinations here thankfully are ramping up with The
• 19:16
  Speaker 1: big big issue for me is getting kids fully back
• 19:20
  Speaker 1: into school next fall. Full after school activities, full athletics
• 19:25
  Speaker 1: back to you. Enough of those kids, you want them
• 19:28
  Speaker 1: gone from seven o'clock in the morning exact, coming home
• 19:31
  Speaker 1: until nine exactly right, and none of this virtual, none
• 19:34
  Speaker 1: of this. You know, I understand why we're doing it.
• 19:36
  Speaker 1: Obviously in many districts have done a great job. But
• 19:38
  Speaker 1: let's get the kids back to school. And then it
• 19:40
  Speaker 1: appears when you start to see some of this data
• 19:42
  Speaker 1: coming out from some of these pharmaceutical companies, Matt that um,
• 19:45
  Speaker 1: you know, it's more and more likely every day that
• 19:47
  Speaker 1: we're going to get there. You know, it would be
• 19:49
  Speaker 1: great is if you could get your kids into the
• 19:51
  Speaker 1: Goldman Sachs Analyst training program exactly, you'd never see him again,
• 19:56
  Speaker 1: you know, yeah, exactly what you know, I did that
• 19:58
  Speaker 1: back in the day, and U you know what was
• 20:01
  Speaker 1: different there, you know I was doing weeks uh. And
• 20:05
  Speaker 1: but what was different then is we were all together
• 20:08
  Speaker 1: in the office. We had that sense of camaraderie. Um.
• 20:11
  Speaker 1: And but it's really I can see how could be
• 20:13
  Speaker 1: really difficult here, uh, with this whole virtual thing. You're
• 20:16
  Speaker 1: stuck in your apartment somewhere and you're grinding it out
• 20:19
  Speaker 1: and you don't have the support of your fellows, you know,
• 20:21
  Speaker 1: analysts that are also going through it, so I can
• 20:24
  Speaker 1: see what's going on there for those folks. That's a
• 20:26
  Speaker 1: that's a good point I want to get, just to
• 20:28
  Speaker 1: get back to the vaccines. I'm getting more and more
• 20:31
  Speaker 1: terrified about astra zeneca. I know, we talked about it
• 20:34
  Speaker 1: a lot, and we've decided, you know, we'll take any
• 20:36
  Speaker 1: shot they give us because we're good citizens, because you know,
• 20:38
  Speaker 1: we want to be yep uh, participants in in the
• 20:42
  Speaker 1: healthy global economy. But Germany yesterday said, all right, you
• 20:46
  Speaker 1: know what, no one under sixty gets the astros enneca shot.
• 20:50
  Speaker 1: Previously they said no one over sixty five, So the
• 20:52
  Speaker 1: window is getting smaller and smaller. They found thirty one
• 20:55
  Speaker 1: cases of blood clots in nine cases leading to day
• 21:00
  Speaker 1: fs UM, and some were people who were only twenty
• 21:04
  Speaker 1: years old. You don't want to walk into you know,
• 21:07
  Speaker 1: a doctor's office in your twenties to get a vaccine
• 21:11
  Speaker 1: that you think is gonna you know, make you not
• 21:14
  Speaker 1: get COVID and then die of an embolism. That's like,
• 21:18
  Speaker 1: that's very very Let's go to the expert. Let's bring
• 21:21
  Speaker 1: in an expert. Matt Sam Fazelli. He's a senior pharmaceutical analysts.
• 21:24
  Speaker 1: He's also a head of a research for Bloomberg Intelligence
• 21:27
  Speaker 1: in Europe. And Sam knows all about this stuff. He's
• 21:29
  Speaker 1: got a PhD in something that I think is somewhat related. Sam,
• 21:32
  Speaker 1: let's start with the astro Zeneca. What do we know.
• 21:35
  Speaker 1: There's so much misinformation or just I guess cross currents
• 21:39
  Speaker 1: of information out there. What's your sense of this astro
• 21:42
  Speaker 1: Zeneca vaccination. Yeah, Hi, Paul, So I think I would
• 21:46
  Speaker 1: call it cross currents some was a good phrase they
• 21:48
  Speaker 1: use their misinformation or confusing information. So what I'd like
• 21:53
  Speaker 1: to do is to run with the one country that
• 21:57
  Speaker 1: has been very clear about the numbers, etcetera. Come out with,
• 22:00
  Speaker 1: and that's the pool Earlier institute in Germany. They're now
• 22:03
  Speaker 1: talking about thirty one cases temporarily associated with the vaccination dose.
• 22:10
  Speaker 1: And then when you start looking at those numbers, now
• 22:12
  Speaker 1: thirty one cases over about two months of vaccinating out
• 22:16
  Speaker 1: of two point seven million doses. That calculates to something
• 22:19
  Speaker 1: in the region of a sixty eight or seventy roughly
• 22:24
  Speaker 1: um cases per annum per million, And that is higher
• 22:29
  Speaker 1: than any other estimate that I've seen for the natural
• 22:33
  Speaker 1: number of cases here. So so we're now in the
• 22:35
  Speaker 1: realms that that that a serious institution has talked about
• 22:40
  Speaker 1: numbers that they have adjudicated and they think I might
• 22:42
  Speaker 1: be related. I think everyone needs to seriously Look. I
• 22:47
  Speaker 1: get what you're saying, and I don't play the Loto
• 22:50
  Speaker 1: because I don't think there's any chance that I would win.
• 22:53
  Speaker 1: But at the same time, if I'm in my twenties,
• 22:57
  Speaker 1: I want my chances of dying from a blood class
• 23:00
  Speaker 1: temporarily related to a vaccine to be zero, you know,
• 23:03
  Speaker 1: to be none. I don't. I don't care if two
• 23:08
  Speaker 1: point seven million people got it and we're fine. I
• 23:10
  Speaker 1: don't want to be the one person that gets a
• 23:12
  Speaker 1: blood clot and dies. And if there's any causation, I
• 23:17
  Speaker 1: think it's a hard cell. Sam, You're right. Unfortunately, people
• 23:22
  Speaker 1: don't get vaccinated just for themselves. Um. The reason vaccines
• 23:26
  Speaker 1: work is that it creates a community of vaccinated people,
• 23:31
  Speaker 1: which then makes it very difficult for the virus to
• 23:33
  Speaker 1: to to pass around, which is what some people talk about.
• 23:37
  Speaker 1: This wall of immunity that we put up against the virus.
• 23:40
  Speaker 1: That's when you see much more than the some of
• 23:43
  Speaker 1: the individuals who are protected. Now. I understand that you
• 23:47
  Speaker 1: can't go and sell that to a twenty year old,
• 23:50
  Speaker 1: but frankly, if the only vaccine available, which is not
• 23:54
  Speaker 1: the case, but if the only vaccine available with aster zeneca,
• 23:57
  Speaker 1: I would say they absolutely have to get it because
• 24:00
  Speaker 1: there's just no other option. And and in fact the
• 24:04
  Speaker 1: case counts. You know, some of them are likely to
• 24:06
  Speaker 1: have been people who would have had it anyway, So
• 24:09
  Speaker 1: really still need to be studied and understood why it's related.
• 24:13
  Speaker 1: Um And I mean, let me give you another thing, Matt.
• 24:16
  Speaker 1: What if in a four months time, few months time,
• 24:19
  Speaker 1: as Johnson and Johnson's rolled out, you get the same
• 24:21
  Speaker 1: signal there, then what do you do? Or what if
• 24:24
  Speaker 1: find a BioNTech in three months time or two months
• 24:27
  Speaker 1: time you see a rare case of stuff going on
• 24:30
  Speaker 1: in there. I mean, I'm not expecting anything, but I'm saying,
• 24:33
  Speaker 1: what if we have to make choices and this has
• 24:36
  Speaker 1: to be one of them. Sam stepping back, and I
• 24:39
  Speaker 1: know you're you're based in France. I spend a lot
• 24:42
  Speaker 1: of time in the UK, our audience here in the US.
• 24:47
  Speaker 1: A sense of why has the vaccination rollout been so
• 24:51
  Speaker 1: challenging In the European Union in particular. Yes, so it's
• 24:55
  Speaker 1: all so far, it's all about not having had the
• 24:57
  Speaker 1: doses to do the job. And I mean, let's not
• 25:01
  Speaker 1: forget that France has got about to have present of
• 25:04
  Speaker 1: its population now vaccinated with at least one though or something.
• 25:07
  Speaker 1: That that's now it's starting to become respectable, right, Okay.
• 25:11
  Speaker 1: The point is though, that when you did your deals late,
• 25:17
  Speaker 1: when he spent and this is the European Union that
• 25:19
  Speaker 1: I am blaming nobody else, right, not the countries they
• 25:23
  Speaker 1: kind of abdicated to the U, because that's what they're
• 25:26
  Speaker 1: supposed to be the the points of the European Union.
• 25:30
  Speaker 1: When they did their deals and negotiated for every single
• 25:34
  Speaker 1: cent and did the deals extra number of months later,
• 25:38
  Speaker 1: when they did not invest in manufacturing like the UK
• 25:41
  Speaker 1: government did, like the US government did, and gave these
• 25:44
  Speaker 1: companies billions of dollars, then you pay a price. And
• 25:47
  Speaker 1: unfortunately this is the price. All right, Sam, thank you
• 25:51
  Speaker 1: so much for joining us. We always appreciate getting your
• 25:54
  Speaker 1: perspective here. San Fazeli he's a senior pharmaceutical analyst, folks.
• 25:58
  Speaker 1: He's one of the best in the city of London,
• 26:00
  Speaker 1: covering the European big pharmaceutical companies. Also, he manages the
• 26:04
  Speaker 1: research department in Europe for Bloomberg Intelligence. He's got a
• 26:07
  Speaker 1: lot of experience in this stuff. He's been very helpful
• 26:09
  Speaker 1: to us over these past twelve months as you try
• 26:12
  Speaker 1: to get a sense of what this pandemic is about,
• 26:14
  Speaker 1: what this virus is about, and now over the last
• 26:17
  Speaker 1: several months, about these vaccines and the rollout of these
• 26:20
  Speaker 1: vaccines and the efficacy of these vaccines. So good numbers
• 26:24
  Speaker 1: out of the UK, good numbers out of the US,
• 26:26
  Speaker 1: and some improving numbers out of the European Union as
• 26:30
  Speaker 1: they try to catch up. Thanks for listening to the
• 26:33
  Speaker 1: Bloomberg Markets podcast. You can subscribe and listen to interviews
• 26:37
  Speaker 1: with Apple Podcasts or whatever podcast platform you prefer. I'm
• 26:42
  Speaker 1: Matt Miller. I'm on Twitter at Matt Miller three. Put
• 26:46
  Speaker 1: on false Sweeney I'm on Twitter at pt Sweeney. Before
• 26:49
  Speaker 1: the podcast. You can always catch us worldwide at Bloomberg Radio.