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Equities, COP27, and Big Tech Turmoil (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
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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. All right, so we've
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Speaker 1: got some mid term elections tomorrow. A lot of key
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Speaker 1: states are having some some big races. Here Bloomberg, we'd
0:29
Speaker 1: like to talk about the political side in the context
0:31
Speaker 1: of the impacts on markets. So we bring in Cameron
0:35
Speaker 1: christ He's a macro strategist for Bloomberg News. So Cameron,
0:38
Speaker 1: you know you're looking across the markets here broadly defined.
0:43
Speaker 1: How are you kind of handicapping this midterm election as
0:48
Speaker 1: it relates to markets. Are you thinking traders are putting
0:50
Speaker 1: on any bets? Is it a wait and see type
0:52
Speaker 1: of thing? What are you hearing? Yeah? I think it's
0:56
Speaker 1: I mean, it's tough because there's so much going on
0:58
Speaker 1: outside of the of the US political sphere. Um as
1:02
Speaker 1: you alluded to, We've got CPI later this week, and
1:05
Speaker 1: there's also the China stuff. I mean, people seem to
1:08
Speaker 1: be getting excited about the prospect of China reopening, even
1:13
Speaker 1: though domestically, you know, there are still officially denying that
1:17
Speaker 1: that's imminent, and COVID cases in China are are rising.
1:21
Speaker 1: So it's it's kind of tough to sort of just
1:24
Speaker 1: pick out the isolated impact of mid terms. Um, insofar
1:28
Speaker 1: as you can. I guess there's this idea that, um,
1:34
Speaker 1: that a switch in in the House would be kind
1:39
Speaker 1: of positive for the stock market. UM. I'm not sure
1:44
Speaker 1: how plausible that is. I think generally speaking, people tend
1:48
Speaker 1: to overestimate the significance of individual political actors in driving
1:55
Speaker 1: economic and certainly financial market returns. Now, obviously there are
1:59
Speaker 1: exceptions to that we've seen in the UK this year. Uh,
2:02
Speaker 1: But broadly speaking, UM, I mean, is the is the
2:08
Speaker 1: US economy gonna look radically different depending on who wins
2:13
Speaker 1: the House uh tomorrow? You know, is it gonna look
2:17
Speaker 1: radically different over the next two years? Arguably not that
2:21
Speaker 1: much different. Cam. So, I was just sitting on set
2:26
Speaker 1: with John Farrow from nine to ten AM, and I
2:28
Speaker 1: loved the question that he asked. Morgan Stanley's Mike Wilson
2:32
Speaker 1: I want to ask you the same question. If you
2:34
Speaker 1: could know the outcome of the midterm elections, or you
2:37
Speaker 1: could know what this week's CPI reading would be, which
2:40
Speaker 1: one would you pay without a doubt CPI without a doubt.
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Speaker 1: That's actually not what Mike Wilson said. Why would you
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Speaker 1: rather know cp I? Because you know, as I just said,
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Speaker 1: I I really don't think it matters UM who gets
2:52
Speaker 1: in UH to to to Congress. I really don't. I mean,
2:56
Speaker 1: the the pattern there is a quite a strong path
3:00
Speaker 1: earned based on the calendar UH in in in terms
3:04
Speaker 1: of UM, the third year of a presidential term is
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Speaker 1: typically very very strong UH for the stock market. UM.
3:12
Speaker 1: And that is kind of irrespective of who of who
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Speaker 1: of who gets in UM. I know, I know Wilson
3:18
Speaker 1: thinks that it's it's going to be it's pretty supportive
3:20
Speaker 1: of the stop mark in the near term if the
3:22
Speaker 1: Republicans get in, so obviously, if he has that view,
3:24
Speaker 1: and then that's what he wants to know. UH. And
3:27
Speaker 1: I guess in the micro term, if people want to
3:28
Speaker 1: get excited about the outcome of the election, whatever it
3:31
Speaker 1: might be, then yeah, maybe you want to know that.
3:33
Speaker 1: But again, I'm pretty skeptical that it matters very much
3:36
Speaker 1: at all in the in the medium term. Um, so
3:40
Speaker 1: I would rather know the CPI. I would rather know
3:42
Speaker 1: the CBI number, even though as we saw on Friday,
3:44
Speaker 1: and maybe that doesn't matter either. So I guess I
3:47
Speaker 1: really want to know is one's China going to reopen?
3:49
Speaker 1: If I can I canswer the question? Yeah please? Yeah, yeah,
3:54
Speaker 1: all right? So Cameron, Um, you know, the CPI data
3:58
Speaker 1: is on the Thursday, and obviously that will be a
4:00
Speaker 1: key driver for these markets and handicapping what the Feds
4:03
Speaker 1: are gonna do. But a lot of folks are saying,
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Speaker 1: you know, that's a backward looking, uh kind of measurement here.
4:08
Speaker 1: What's what's your inflation call? Do you feel like it's peaked?
4:11
Speaker 1: You feel like it's coming down? I mean, we heard
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Speaker 1: from Rich Truman, who produces Bloomberg Surveillance this morning that
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Speaker 1: his favorite pasta dish at his favorite restaurant from eighteen
4:19
Speaker 1: bucks pre pandemic to thirty two dollars today. That's inflation.
4:22
Speaker 1: How are you viewing inflation? Yeah, I mean, I mean
4:25
Speaker 1: I have to sort of define the rules of engagement here.
4:29
Speaker 1: If you're talking about the year on your change in
4:32
Speaker 1: the headline CPI index. Then yeah, it's it's it's very
4:36
Speaker 1: likely peaked. UM. If you're saying that if inflation is peaked,
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Speaker 1: that means that the marginal price changes are going to
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Speaker 1: get with with some rapidity, go back to levels of
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Speaker 1: the FED is comfortable with. I think that's that's that's
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Speaker 1: less likely. UM. For one, the shelter component UH tends
4:57
Speaker 1: to lag. It's a big portion of c b I
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Speaker 1: PC partically on a core basis, UH, and that's going
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Speaker 1: to continue to push up inflation for you know, the
5:07
Speaker 1: next few quarters. UM. Kind of regardless of what what
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Speaker 1: the housing market does, not just the nature of of
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Speaker 1: the beast UM. More generally, as long as the labor
5:17
Speaker 1: market reminds tight services beyond the housing market are are
5:23
Speaker 1: going to continue generating inflation because it's still tough to
5:25
Speaker 1: get you know, it's still tough to get labor. I mean,
5:27
Speaker 1: part of that pasta dish cost is. Yeah, the price
5:31
Speaker 1: of the price of rigatoni has gone up. Part of
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Speaker 1: it's the price of bolon at sauce have gone up.
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Speaker 1: But part of it is because it's difficult to hire
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Speaker 1: people to cook the food and serve the food and
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Speaker 1: then clean the food up. Yep, that's kind of what
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Speaker 1: he was lamenting. But I mean, you've gotta feel for
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Speaker 1: a guy whose favorite pasta dish so much, so much
5:49
Speaker 1: over the past few years. That's when he brings it,
5:51
Speaker 1: brings it home. There, Camera Christ good stuff. They're appreciated
5:54
Speaker 1: as always. Cameras a macro strategists for Bloomberg News comfortably
6:00
Speaker 1: working from home. We might add so a great time too, Yeah,
6:03
Speaker 1: I mean exactly. So, you know, I'm just looking at
6:05
Speaker 1: these markets. It's kind of an odd day. Obviously, the
6:07
Speaker 1: dollop you know, two points, that's a half of one percent,
6:10
Speaker 1: whereas NASDAC still feeling the hangover. I think of the
6:14
Speaker 1: earnings we saw, you know, last week, and now some
6:17
Speaker 1: of these layoff announcements today. Uh, you know, I think
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Speaker 1: it's really calling into question kind of the growth story
6:23
Speaker 1: underpinning that tech sector, maybe getting a little bit of
6:26
Speaker 1: a rerating their mid term elections tomorrow, CPI Data Thursday.
6:32
Speaker 1: Lots for this market to digest. In addition to continued earnings,
6:36
Speaker 1: got Mickey Mouse's uh Walt Disney Company reporting after the
6:39
Speaker 1: close tomorrow. Lots of cross currents there. Let's check in
6:42
Speaker 1: with the professional who does this stuff for living. Hugh
6:44
Speaker 1: Robert's head of analytics at quant Insights. Before that, he
6:48
Speaker 1: did stints at Merrill Lynch, my former firm, Credit Swiss,
6:53
Speaker 1: my former firm. You get a sense of what's going
6:55
Speaker 1: on here, Hugh, Thanks so much for joining us here again.
6:58
Speaker 1: Lots across currents out there, tons of underperformance no matter
7:02
Speaker 1: where you look as a classes so far in two.
7:06
Speaker 1: What are you telling clients these days? Yeah? I agree
7:10
Speaker 1: totally with the lots of cross currents, and I think
7:13
Speaker 1: what's jumping out off our models at the moment is
7:16
Speaker 1: that now we've been pretty bearish on equities for most
7:19
Speaker 1: of two. You know, the message from the power FED
7:23
Speaker 1: about tightening financial conditions to fight inflation has been very
7:27
Speaker 1: evident on our models, and we've seen a substantial move
7:31
Speaker 1: in that direction. But even though we kind of got
7:34
Speaker 1: Jackson hole two or whatever you want to label the
7:37
Speaker 1: tone to last week's FED meeting ads, we haven't seen
7:43
Speaker 1: the same move in terms of tightening financial conditions. If
7:46
Speaker 1: you look at credit spreads, tighter real yields of stop
7:49
Speaker 1: legging higher, the dollars come back a bit. Now, there
7:53
Speaker 1: are indio some trastic stories at play. Even there you
7:55
Speaker 1: know that the dollar move might be as much about
7:57
Speaker 1: China reopening as it is about anything the estic us driven.
8:01
Speaker 1: But the bottom line on our modeling is that the
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Speaker 1: tightening the financial conditions there has been a huge headwind
8:08
Speaker 1: and the major driver of the equity by bear market.
8:10
Speaker 1: In the last few months, they've stopped tightening and that
8:15
Speaker 1: opens up a little bit of evaluation gap on our
8:17
Speaker 1: models where you're starting to see US equity indices spoons
8:22
Speaker 1: now is that there they are all cheap to macro
8:25
Speaker 1: on the modeling that we've done. So that's probably the
8:28
Speaker 1: most interesting thing that we're watching at the moment. So
8:31
Speaker 1: talk to me about what cheap to macro means. Is
8:34
Speaker 1: that a bi signal in your models? It is, yes, Sorry,
8:38
Speaker 1: So it to be clear what we do is we
8:40
Speaker 1: take a huge number of macro factors, but they fall
8:43
Speaker 1: into three broad buckets. So it's economic fundamentals, that's levels
8:46
Speaker 1: of growth, tracking GDP numbers, expectations around inflation. They fall
8:52
Speaker 1: into a bucket that is kind of overall financial conditions
8:55
Speaker 1: at the level of real yields, the slope of the
8:57
Speaker 1: yield curve, how strong the dollar is, um what the
9:01
Speaker 1: Fed might be doing in terms of tightening or easing,
9:04
Speaker 1: both in terms of rates and the balance sheet. And
9:07
Speaker 1: then the last big bucket would be measures of risk
9:09
Speaker 1: appetites and stuff like vix um and then more traditional
9:13
Speaker 1: measures like cold silver. But it's all those economic fundamentals,
9:17
Speaker 1: financial conditions, risk appetite all rolled up to say, right,
9:21
Speaker 1: given where all these macro variables are right here, right now,
9:25
Speaker 1: fair value on spoons is X, on the net back
9:28
Speaker 1: is y, etcetera. And because mainly because of the financial
9:32
Speaker 1: condition side of that three legged kind of input, because
9:36
Speaker 1: they've not actually tightened and actually come back a bit,
9:39
Speaker 1: our model values actually tipped a little bit higher for
9:42
Speaker 1: your sequity and disease while you've had this sell off
9:45
Speaker 1: of the last couple of weeks. So that's opened up
9:48
Speaker 1: a cheap valuation in our language. So I guess what
9:53
Speaker 1: is your recession call here? I mean, I guess you
9:56
Speaker 1: know there's definitely and over in Europe, you guys have
9:59
Speaker 1: some real real economic challenges. What's your recession car for
10:03
Speaker 1: the US? So we're not actually a traditional kind of
10:06
Speaker 1: a macro forecasting shop. We don't have a call to say,
10:09
Speaker 1: you know, the Eurozone is going to contract by this
10:11
Speaker 1: much whereas the US might just engineer a softer landing. Um,
10:16
Speaker 1: there's plenty of very clever economists out there and talking
10:19
Speaker 1: heads who do that. What q I S value added
10:22
Speaker 1: is we can tell you the market's reaction function to
10:25
Speaker 1: those economic fundamentals. So if you were, for example, a
10:28
Speaker 1: massive growth bear and you said Eurozone is going to
10:31
Speaker 1: bear the brunt of it because of geographical proximity to
10:34
Speaker 1: Russia and the energy crisis and everything else, we can
10:37
Speaker 1: tell you, right, but it's had a long duration trade.
10:39
Speaker 1: Should I be long buns? Should I be short the EUROFX?
10:43
Speaker 1: Is it a short eurostock fifty play? Or which sector
10:46
Speaker 1: within euros is it? So that's really more Our value
10:49
Speaker 1: added is measuring the relationship between any financial security, bond,
10:54
Speaker 1: currency equity, whatever it may be, and the macro environment.
11:00
Speaker 1: But we're not a shop that's going to turn around
11:02
Speaker 1: and say three U s GDP is going to be
11:06
Speaker 1: this euro presenting GDP is going to be that. All right,
11:08
Speaker 1: Well you're based and looking at the Bloomber turnal fifty
11:10
Speaker 1: Liverpool Street, is that right where we were? Yet we're
11:14
Speaker 1: London based, Yeah, yeah, So what's it like in the
11:17
Speaker 1: city of London these days? It's you know, three thirty
11:19
Speaker 1: a p m. There you went out for lunch, presumably.
11:22
Speaker 1: How are the streets of London the prett marmang airs
11:26
Speaker 1: for example. Yeah, well there's a there's a very rude
11:29
Speaker 1: acronym that I can't repeat live on air. But most
11:32
Speaker 1: people have turned into Tuesday, Wednesday, Thursday working from the
11:36
Speaker 1: office and Monday and Friday from home, So Monday is
11:40
Speaker 1: probably not a fair representative I got you. Yeah, middle
11:43
Speaker 1: of the week. I would say London is back to
11:46
Speaker 1: kind of like volume and foot traffic or what you
11:49
Speaker 1: used to see. I think in terms of the mood, um, yeah,
11:54
Speaker 1: people are very aware, especially near the whole trosonomic saga. Um,
11:58
Speaker 1: I think brought so much of what we do, which
12:01
Speaker 1: is normally quite leash uh in the middle of the newspaper,
12:05
Speaker 1: brought it very much onto the front pages. I think,
12:08
Speaker 1: you know, mortgage rates is probably where what do meets
12:12
Speaker 1: Main Street right first and foremost, and that story has
12:16
Speaker 1: been splashed everywhere in the UK media. So the mood
12:19
Speaker 1: is pre downbeat. I think people are expecting now the
12:22
Speaker 1: housing market correction and tough times ahead. So it is
12:26
Speaker 1: not greater the UK. All right, we'll hanging there, Hugh
12:28
Speaker 1: Robert's head of analytics at quant Insights. Well, this Federal Reserve,
12:34
Speaker 1: if nothing else, has been quite clear in its messaging
12:38
Speaker 1: what it's what it's doing with rates. You had, obviously, uh,
12:42
Speaker 1: a couple of big, big meetings recently, and they've been
12:45
Speaker 1: quite clear that number one issue is to fight inflation.
12:48
Speaker 1: How how did they go? When do they start? Pre
12:50
Speaker 1: a Miserraam, Managing director and global head of rates Strategy
12:52
Speaker 1: of TV Securities, joins us. So, what's your takeaway here,
12:57
Speaker 1: um as as to where this Federal Reserve is going
13:00
Speaker 1: after we think about the next three to six months
13:03
Speaker 1: in terms of rates. Sure, thanks for having me. So.
13:07
Speaker 1: I think that the Fed is trying to give a
13:09
Speaker 1: very nuanced message here that they could slow down the pace,
13:12
Speaker 1: and that's what they suggested, could happen as early as
13:15
Speaker 1: the December meeting, but they could keep going until they
13:18
Speaker 1: see very clear and convincing signs. Those are the terms
13:20
Speaker 1: that they've been using that inflation is decelerating. So our
13:23
Speaker 1: view is a fifty basis point in December, another fifty
13:27
Speaker 1: in March, and then a series of twenty to bring
13:30
Speaker 1: the terminal rate to five and a half and that's
13:32
Speaker 1: really because we see inflation declining and actually we have
13:35
Speaker 1: a lower than consensus called CPI podcast for Thursday, But
13:40
Speaker 1: it's it's so broad based that we think that decline
13:43
Speaker 1: is going to be slow and inflation is sticky because
13:46
Speaker 1: it's so broad based. So you know, if inflation doesn't
13:49
Speaker 1: decelerate that fast, we think it's going to prevent the
13:52
Speaker 1: FED from being able to stop soon. So they can
13:55
Speaker 1: slow down the pace but keep going. We think until
13:58
Speaker 1: really middle of next year in doing it five and
14:00
Speaker 1: a half and then they're going to have to be
14:02
Speaker 1: resolute and just keep it there because inflation is still
14:05
Speaker 1: going to look high. We focus about four percent inflation
14:07
Speaker 1: at what point they stop, and then we actually have
14:10
Speaker 1: them easing by the end of next year or more
14:13
Speaker 1: so really into twenty four because by then inflation becomes
14:16
Speaker 1: less of an issue, but the growth side becomes problematic
14:19
Speaker 1: for the FED because we see the unemployment rate rising.
14:21
Speaker 1: So I think it's going to be a tricky one
14:24
Speaker 1: for the FED next year. Preal Let's game plan what
14:27
Speaker 1: a five and a half percent terminal rate would look
14:29
Speaker 1: like in terms of the bond market, because I'm looking
14:31
Speaker 1: at two year yields right now at four points seven
14:36
Speaker 1: per cent, do they eclipse five? The terminal rate really
14:39
Speaker 1: does go that far. You know, I think we could
14:42
Speaker 1: just about touch five, but I don't think we get
14:45
Speaker 1: as high as five and a half, or that we
14:47
Speaker 1: can sustain five for the two years because the markets
14:51
Speaker 1: forward looking and is going to price in rate cuts.
14:53
Speaker 1: I mean, we think we're already seeing signs of some
14:56
Speaker 1: slowing in the consumer. You look at the third quarter
14:58
Speaker 1: GDP number, how sing of course it's clearly snow slowing.
15:02
Speaker 1: So this is the first time the fat is going
15:03
Speaker 1: to be hiking into a growth slowdown, and I think
15:06
Speaker 1: that's going to keep these cuts. In twenty four I
15:09
Speaker 1: think we'll actually see more of that cut pricing being
15:12
Speaker 1: built in and that will prevent that front tent from rising.
15:15
Speaker 1: But yeah, I would say risks are more asymmetric, meaning
15:19
Speaker 1: those front ten rates can still keep rising because you know,
15:21
Speaker 1: we're saying five and a half. Maybe it's higher than
15:24
Speaker 1: five and a half if inflation really doesn't decelerate fast.
15:28
Speaker 1: So I'm looking at the two year and a ten
15:30
Speaker 1: year treasury still inverted, you know, fifty fifty one points here.
15:34
Speaker 1: What does that tell you? What is what? What are
15:37
Speaker 1: you hearing from clients about that? Is that's still an issue? Yeah,
15:42
Speaker 1: I think the inversion has been something we've had to
15:46
Speaker 1: get used to, and I think we'll have to live
15:48
Speaker 1: with this inversion for quite some time. I think investors
15:51
Speaker 1: are asking me, you know, when's the time to put
15:53
Speaker 1: on a steep now? If we think the fat's going
15:55
Speaker 1: to be cutting at the end of next year, is
15:57
Speaker 1: now the time for the steep now? And you know
16:00
Speaker 1: a term, Yes, if you get a weaker CPI, the
16:02
Speaker 1: curve can steepen a little bit. I think it's still
16:04
Speaker 1: too early for that steep now. We really the curve
16:06
Speaker 1: tends to only steepen when cuts are about three months
16:09
Speaker 1: UM priced out. And I don't think this FED can
16:12
Speaker 1: even talk about cutting let alone. I mean they're not
16:14
Speaker 1: even talking about pausing. So I think the curve stays inverted.
16:19
Speaker 1: Any big steepening should be feeded. And you really have
16:22
Speaker 1: to wait for that inflation fear from the FED from
16:24
Speaker 1: the market to come down before we can start legging
16:27
Speaker 1: into steepness, legging into steepness. So you said that you
16:30
Speaker 1: know three months out from the cut is if I'm
16:33
Speaker 1: understanding you correctly, that's when you would start going in
16:37
Speaker 1: on the steepener or recommending it. If if the FED
16:40
Speaker 1: is going to cut by the end of next year,
16:44
Speaker 1: does that mean September next year is when you know,
16:47
Speaker 1: maybe you do see that two year ye'ld start following
16:49
Speaker 1: those steepeners make a little bit more sense. Sure, yes,
16:53
Speaker 1: so we're thinking fourth quarters when you start thinking about steepness.
16:57
Speaker 1: I mean, if inflation has ends up being high than
17:00
Speaker 1: our forecast, which is possible, I would say that bias
17:03
Speaker 1: is higher inflation just because wage inflation is high and
17:06
Speaker 1: it's a broad based increase. Maybe it's even closer to
17:09
Speaker 1: the end of next year. So the trade I think
17:11
Speaker 1: between now and then is more a long duration stand
17:15
Speaker 1: rather than a curve steepna because you know, at some
17:18
Speaker 1: point investors are going to want to a recession risk hedge,
17:22
Speaker 1: and I think that's just owning long end treasuries rather
17:25
Speaker 1: than playing for that fadies because the Fed is going
17:28
Speaker 1: to be very reluctantly easy when they do. So we
17:32
Speaker 1: do have midterm elections tomorrow. I wonder how you think
17:35
Speaker 1: about that. I don't know how much you've kind of
17:37
Speaker 1: factor in politics geopolitics into your outlook. How do you
17:42
Speaker 1: think about that sure, so not a whole lot um.
17:46
Speaker 1: I mean, even with the Democrats controlling all three chambers
17:50
Speaker 1: of government, we actually didn't see a whole lot of stimulus.
17:53
Speaker 1: I think other than COVID stimulus, we haven't had much
17:56
Speaker 1: physical stimulus. So if you get gridlock, normally conventional with
18:00
Speaker 1: them would mean less policy. Good for risk assets, probably
18:03
Speaker 1: good for bonds. I would say we've been in that
18:06
Speaker 1: regime already because it was such a tight split. I
18:09
Speaker 1: do worry about the dead ceiling. I hate talking about it,
18:12
Speaker 1: but we're going to be dealing with dead ceiling early
18:14
Speaker 1: next year. It's going to go down to the wire.
18:17
Speaker 1: Markets never like that, so I think that's one source
18:19
Speaker 1: of sort of wild card around the dead ceiling. I
18:22
Speaker 1: think political pressure on the FED will be high as well,
18:25
Speaker 1: But I think this FED has been clear that it's
18:27
Speaker 1: about inflation um, and I think we don't get any
18:30
Speaker 1: fiscal stimulas. So even in my view, where the economy
18:32
Speaker 1: hits the recession by the third quarter of next year,
18:35
Speaker 1: normally we'd look for fiscal easing and monitories ing. I
18:39
Speaker 1: think this time, inflation doesn't allow monitories. In split government
18:42
Speaker 1: doesn't allow fiscal easing, so that's why you know that
18:46
Speaker 1: recession need not be very short lived because you just
18:48
Speaker 1: don't have any policy support. Pretty I'm going to ask
18:51
Speaker 1: you the question that John Pharaoh asked Michaelson from Morgan Stanley,
18:55
Speaker 1: and then I asked him Christ about an hour ago,
18:58
Speaker 1: I think, or a little lessn't that would you rather
19:00
Speaker 1: know the outcome of the midterm elections or would you
19:03
Speaker 1: rather know what the CPI print on Thursday is going
19:06
Speaker 1: to be? Oh? C p I A need. I think
19:10
Speaker 1: that's what's going to tell us a lot more about
19:12
Speaker 1: FED policy, which is actually front and center in everyone's mind.
19:15
Speaker 1: Mike Wilson is the odd man out. He is. I
19:18
Speaker 1: know he wants to know the mid term election chare,
19:20
Speaker 1: but I kind of agree with Prea. Just feels like
19:22
Speaker 1: what's driving this market is and earnings, it's it's it's
19:26
Speaker 1: just kind of the Fed and what are they going
19:27
Speaker 1: to do? So I agree with you, so Priam, thank
19:30
Speaker 1: you so much for joining us. Managing Director and Global
19:33
Speaker 1: head of Rate Strategy for t D Securities. United Nations
19:42
Speaker 1: Climate Change Conference, more commonly known as COP twenty seven
19:45
Speaker 1: is taking place as we speak in Egypt. Uh. The
19:49
Speaker 1: question is what can they get done at this conference here,
19:52
Speaker 1: and let's check in with Sadekwaba, member of the President's
19:55
Speaker 1: National Infrastructure Advisory Council. Uh. He is also the founder,
19:59
Speaker 1: chairman and managing partner of I Squared Capital. He's a
20:03
Speaker 1: member of the Council of Foreign Relations since March. He's
20:06
Speaker 1: also got a few advanced degrees. Uh. You know, kind
20:10
Speaker 1: of just thrown in there for good measure. But Soedak,
20:12
Speaker 1: thanks so much for joining us from Egypt. Given the
20:16
Speaker 1: global geopolitical backdrop, Sedek, what is a reasonable expectations for
20:21
Speaker 1: COP twenty seven in your mind? Thanks for having the
20:27
Speaker 1: appointing to so. Look, the purpose of the COP twenties
20:30
Speaker 1: seven is really to achieve five goals. One is an
20:34
Speaker 1: obvious one, which is stronger commitments from countries in terms
20:38
Speaker 1: of reducing carbon emission, which is what they've degreed in
20:41
Speaker 1: the previous confidence. The second one, which is a little
20:44
Speaker 1: bit more controversial, which is what they call loss of damage,
20:48
Speaker 1: not of the emerging markets and emerging economies are basically
20:52
Speaker 1: seeing we're going to bear the disproportionate share of climate change,
20:57
Speaker 1: so you need to in one way or another compensate us,
21:01
Speaker 1: and of course the world compensate is not something that
21:04
Speaker 1: industrial economies like to hear. And also given the economic
21:09
Speaker 1: crisis we're all feeling today, it's unclear where this money
21:12
Speaker 1: is going to come from. Another goal is adaptation. We
21:15
Speaker 1: need to find ways to reduce emission and these helped
21:20
Speaker 1: African economies and other madrigal economies find those technological ways.
21:25
Speaker 1: And then of course climate finance. How are you going
21:28
Speaker 1: to pay for all this? So at the bottom line,
21:30
Speaker 1: it's a question of where can we get the money,
21:33
Speaker 1: who's going to pay for it, and who's going to
21:35
Speaker 1: help pay for those increased expenses. Uh. And in the
21:40
Speaker 1: current environment, I think it's cant be very difficult because
21:44
Speaker 1: we have rising budget deficits uh GDP debt of soevern
21:49
Speaker 1: economies is at an all time high, in fact higher
21:52
Speaker 1: than World War two levels UH and we're all facing
21:55
Speaker 1: inflation and potential recession of the coming theory. So the challenges.
22:00
Speaker 1: You don't want any of the goals of the conference
22:04
Speaker 1: to completely collapse, and I think you want to be
22:07
Speaker 1: able to have everyone agree, maybe to disagree, and pundit
22:11
Speaker 1: to the next conference and hopefully a good help, not great,
22:17
Speaker 1: that's not that And so dak I mean, how optimistic
22:22
Speaker 1: are you that those goals that you just lined out
22:24
Speaker 1: will actually be met? Does that need to happen for
22:27
Speaker 1: this conference to be considered a success. I think I
22:33
Speaker 1: didn't think so. I think for this conference to be
22:35
Speaker 1: a success is for the we didn't end up in
22:38
Speaker 1: recrimination between various countries, the countries that have and the
22:42
Speaker 1: countries that don't. I think if you achieve that goal
22:45
Speaker 1: and everyone agrees that the current economic circumstances a tough
22:49
Speaker 1: for everyone, and we all agree that we need to
22:52
Speaker 1: need these goals, uh, then I think that even the
22:56
Speaker 1: itself will be a great achievement and try to focus
22:58
Speaker 1: on particular projects rather than macroeconomic goals, which becomes difficult
23:03
Speaker 1: to monitor. So, so that you've written about the need
23:08
Speaker 1: to greenify infrastructure, can you talk about that, what it means,
23:12
Speaker 1: what it means for investors and markets. Yeah. Absolutely. Look,
23:17
Speaker 1: when you think about the investment that is being made
23:20
Speaker 1: for electric vehicles, Um, you know, it's nice. It's of
23:25
Speaker 1: vehicles are moved from ice internal compass engine into electric vehicles.
23:31
Speaker 1: But at the end of the day, those electric vehicles
23:34
Speaker 1: will drive on roads which is native written in asphalt,
23:37
Speaker 1: on bridges which is made of concrete, steel, and these
23:41
Speaker 1: products are themselves high plaiting inputs. Right um, a percent
23:48
Speaker 1: of steel production still uses coal UH. Asphalt and concrete
23:55
Speaker 1: uses a huge amount of water and electricity, again a
23:59
Speaker 1: lot of it coming from call. So how do you
24:01
Speaker 1: deal with these issues is really going to be a problem.
24:04
Speaker 1: So it's not enough to talk about the electric vehicles.
24:08
Speaker 1: We think it's important to be able to talk about
24:10
Speaker 1: the inputs themselves. Think about the following statistics. We will
24:14
Speaker 1: need to build a New York City equivalent every month
24:21
Speaker 1: for the coming forty years. To think of the amount
24:24
Speaker 1: of inputs infrastructure that will need to be built globally,
24:29
Speaker 1: the amount of energy that it will require. So the
24:32
Speaker 1: way we need to do it is not just by
24:34
Speaker 1: saying let's all have electric vehicles, among other things, is
24:37
Speaker 1: to think creatively about the urban city. And to be fair,
24:42
Speaker 1: Bloomberg and Bloomberg Philanthropies have been focusing precisely on that
24:47
Speaker 1: because that, I think is where the future is, which
24:50
Speaker 1: is the use of technology to be able to have
24:52
Speaker 1: it smart cities that will reduce carbon footprint across the board.
24:58
Speaker 1: And I think the future you've been finding technological solutions
25:03
Speaker 1: like we did, for example, in UH controlling COVID. We
25:07
Speaker 1: spent ten plus billion dollars in the span of nine
25:10
Speaker 1: months to be able to find the right back seats.
25:13
Speaker 1: So I think that needs to be that huge push
25:15
Speaker 1: towards the adopting and adopting of technology to our daily life.
25:22
Speaker 1: That's absolutely critical. You won't be able to do it
25:26
Speaker 1: through conventional methods. All right, that's great stuff. Sekuaba, member
25:32
Speaker 1: of the President's National Infrastructure Advisory Council, is also the founder,
25:36
Speaker 1: chairman and managing partner of I Squared Capital. Reporting to
25:40
Speaker 1: US live from Egypt. The Top twenty seven conference taking
25:45
Speaker 1: place there. It's gonna be going on for a couple
25:46
Speaker 1: of weeks there uh in Egypt. And again it's an
25:49
Speaker 1: annual conference talking on climate change. Uh. It's kind of
25:53
Speaker 1: public private solutions. Perhaps going forward, let's talk big tech
26:01
Speaker 1: and you think back, since it's great financial crisis that's
26:03
Speaker 1: been the leader for this stock market. But we had
26:06
Speaker 1: some really rough earnings this past reporting period and some
26:09
Speaker 1: people starting to question that a little bit. Let's bring
26:12
Speaker 1: some experts on board and get their U ideas. Man
26:15
Speaker 1: Deep singh Uh and A rag Rana there two technology
26:18
Speaker 1: annels with Bloomberg Intelligence Man Deeps in our Bloomberg Interactive
26:22
Speaker 1: broker studio, A Rock joins us on the phones. On Rock,
26:24
Speaker 1: let's start with you, because I want to start with
26:27
Speaker 1: We'll get the man Deeps crazy companies later, the ones
26:30
Speaker 1: that don't ever even have profits. But you've got Microsoft,
26:33
Speaker 1: I mean, that's the bluest of blue chips. Even they
26:37
Speaker 1: we're seeing some challenges in their business model, whether it's earnings,
26:40
Speaker 1: heads winds, or maybe concern from some of their corporate customers,
26:44
Speaker 1: how's that big software space doing? When my Microsoft, my
26:48
Speaker 1: leader is a little bit concerning. So when you think
26:52
Speaker 1: about it, over the past five to six years, they
26:55
Speaker 1: have had a great run in terms of top line growth,
26:58
Speaker 1: you know, north of twelve in constant currency, so pretty
27:02
Speaker 1: much their you know, revenue has doubled just in the
27:04
Speaker 1: last five six years. Now, what's going to happen is
27:07
Speaker 1: over the next year year and a half, when we
27:10
Speaker 1: see the global economy slowing down a little bit. You know,
27:13
Speaker 1: those companies or those clients for them for that matter,
27:16
Speaker 1: that have been spending so robustly on software, they're gonna
27:19
Speaker 1: pull back a little bit. And and this is more
27:22
Speaker 1: so just a mere function of economic think rather than
27:25
Speaker 1: anything to do with the digital or you know, all
27:28
Speaker 1: the emerging technologies that we see now. Having said that,
27:31
Speaker 1: we have confidence that the year after that we're going
27:34
Speaker 1: to see a bounce back in that spending. Okay, I
27:37
Speaker 1: want to talk about the crazy companies that Paul mentioned.
27:40
Speaker 1: I want to do that with man Deep. I want
27:41
Speaker 1: to talk about Twitter. I think I don't know, we
27:44
Speaker 1: should check the the size and scope on this. How
27:46
Speaker 1: much time we talk spending about private companies? Twitter has
27:50
Speaker 1: to be number one, But obviously the news from last week,
27:54
Speaker 1: there's been a lot of news. But one of the
27:55
Speaker 1: big headlines from last week that you had the likes
27:57
Speaker 1: of General Mills, You had Auti Fiser joining the list
28:01
Speaker 1: of companies that aren't going to advertise on Twitter anymore.
28:05
Speaker 1: And the state of ad spending is a little hairy
28:07
Speaker 1: right now. But what could that mean for other social
28:11
Speaker 1: media companies? Were those dollars going to go? Yes? I
28:15
Speaker 1: actually think you know, other competitors like a Snapchat or
28:20
Speaker 1: Meta for example, may benefit from some of that ad
28:23
Speaker 1: dollars that could move from Twitter to you know, companies
28:27
Speaker 1: with more of a direct response UH spend exposure. And
28:31
Speaker 1: the reason I say that is because Twitter is eight
28:34
Speaker 1: brand advertising, they don't use a lot of personalization when
28:38
Speaker 1: it comes to ads, whereas companies with direct response ads
28:42
Speaker 1: they personalized as Even though Apple's privacy changes were a headwind,
28:46
Speaker 1: there's still better R o I in terms of the
28:48
Speaker 1: ad spend. So clearly I think it could make a
28:51
Speaker 1: difference for a company like Snapchat. For Meta, it's just
28:54
Speaker 1: too large for you know, maybe you know, two hundred
28:59
Speaker 1: million dollars moving to Metta. It's not going to make
29:01
Speaker 1: a big difference in their fortunes. Hey, you know, let's
29:04
Speaker 1: step back a little bit here. We are either you know,
29:07
Speaker 1: if you listen to most economists either in or approaching
29:11
Speaker 1: sometime in twe recession. Talk to us about kind of
29:15
Speaker 1: how tech spending tends to kind of perform in a
29:19
Speaker 1: recessionary environment. What are you hearing from the big companies
29:22
Speaker 1: you talk to? Yeah, thanksful. So, So the way we
29:25
Speaker 1: want to think about is the first thing that goes
29:27
Speaker 1: is hardware spending. If you unless you have to upgrade
29:31
Speaker 1: the big hardware equipment that you have, you're going to
29:33
Speaker 1: push that out for a year. The second place you
29:35
Speaker 1: also go is, you know, your legacy on premise software packages.
29:39
Speaker 1: You know, you're not going to upgrade your UM you know,
29:41
Speaker 1: databases or other software packages. But what happens is there
29:46
Speaker 1: are certain areas that you just cannot turn off, so
29:48
Speaker 1: security spending being one of them. You have certain areas
29:51
Speaker 1: within cloud that increases productivity that you're going to still
29:55
Speaker 1: spend a little bit. And the third area that gets
29:57
Speaker 1: spending which cuts in spending I D services, but it's
30:01
Speaker 1: done with I would say a little bit of a
30:03
Speaker 1: lag because the contract that you've signed up or are
30:07
Speaker 1: still driving revenue and you know that's the new booking
30:10
Speaker 1: start to slow down and that has usually a six
30:12
Speaker 1: to nine month lag. Now, having said that, you know,
30:15
Speaker 1: from our side, if we do see a reversal in
30:18
Speaker 1: the interest rate cuts or slow down, I think the
30:23
Speaker 1: fundaments may still be weak, but I think the bounce
30:25
Speaker 1: back is going to come there on all the tech
30:27
Speaker 1: valuations that have been beaten up so far. Alright, Mandy
30:31
Speaker 1: talked to us about the other one of the big
30:32
Speaker 1: growth drivers in the tech area has been this, you know,
30:36
Speaker 1: the secular ship of advertising dollars onto these digital platforms, Google, YouTube, Meta,
30:42
Speaker 1: all those types of things. UM, how are you thinking
30:45
Speaker 1: about that app that revenue stream in a recession. Well,
30:49
Speaker 1: so clearly you're going to see broad based slowdown and
30:53
Speaker 1: adds spending, whether it's on the traditional channels or the
30:56
Speaker 1: digital channels. It's not going to change the secular trend.
31:00
Speaker 1: Although I would argue that connected TV is becoming a
31:03
Speaker 1: much bigger deal than we thought, you know, it was before,
31:07
Speaker 1: simply because a lot of the focus was on mobile.
31:10
Speaker 1: Mobile ads was really the holy glare and the reason
31:14
Speaker 1: why you know, Meta did so well. Connected TV to
31:17
Speaker 1: me is just a different medium when it comes to
31:20
Speaker 1: you know, how you move your traditional broadcast streaming to
31:25
Speaker 1: digital channels and it can curate a lot of first
31:28
Speaker 1: party data. So that's where I feel like there will
31:31
Speaker 1: be a lot of investments. YouTube clearly is the category
31:35
Speaker 1: leader with connected TV. We've seen Roku kind of go
31:38
Speaker 1: through its struggles because they don't have a clear platform,
31:41
Speaker 1: but you could see there's a lot of emphasis around
31:44
Speaker 1: connected TV, you know, for the foreseeable future. All right,
31:47
Speaker 1: good stuff. Guys always appreciate getting a quick round table
31:51
Speaker 1: there on all things technology. We can do that with
31:53
Speaker 1: Man Deep Seeing on a round Bloomberg Intelligence tech analysts.
31:58
Speaker 1: This is the big take the Bloomberg's in depth, original
32:02
Speaker 1: reporting from around the globe. This is a really fast
32:05
Speaker 1: moving story that's caused a lot of outrage among investors.
32:08
Speaker 1: This is so fascinating. The market shutdown in a way
32:11
Speaker 1: it's never done before. That's gonna have consequences for years
32:14
Speaker 1: to come. The Big Take on Bloomberg Radio. All right, well,
32:20
Speaker 1: you know we are big, big fans of The Big Take.
32:23
Speaker 1: These are stories, in depth reported stories on Bloomberg News.
32:26
Speaker 1: And now they've got their own podcast and they've got
32:29
Speaker 1: all kinds of radio shows. You can listen to The
32:31
Speaker 1: Big Take podcasts on the I Heart Radio app, Apple
32:35
Speaker 1: and anywhere else you get your podcast and listen to
32:37
Speaker 1: The Big Take every night at eleven pm Eastern on
32:40
Speaker 1: Bloomberg Radio. I want to bring in West Coast of
32:42
Speaker 1: a host of Bloomberg Big Take. It's a great story.
32:45
Speaker 1: We've all read about how these Russian billionaire oligarchs their
32:49
Speaker 1: yachts are being seized, and there's some amazing yachts and
32:53
Speaker 1: they're being seized due to the kind of response to
32:55
Speaker 1: the war in Ukraine. Now the question is what do
32:57
Speaker 1: you do with them once you got them? Um Wes,
33:00
Speaker 1: you've got a fascinating story here. So it turns out
33:03
Speaker 1: it costs money to own a yacht, doesn't it. Oh yeah,
33:07
Speaker 1: these yachts are very expensive, not just to buy, but
33:10
Speaker 1: to maintain. And as you said at the top there,
33:13
Speaker 1: if you seize one of these yachts, as the US
33:16
Speaker 1: government does and other European governments have done, as their
33:20
Speaker 1: pursuing sanctioned Russian billionaires and trying to get what they
33:24
Speaker 1: call the spoils of war, they take these things. Uh,
33:27
Speaker 1: they haullow into port and then they sit there and
33:31
Speaker 1: it is not cheap to maintain them. As one person
33:33
Speaker 1: told Stephanie Baker, who is the guest on the show
33:36
Speaker 1: today on the Big Take podcast, she says, these things
33:39
Speaker 1: are trying to sink every day if you do not
33:42
Speaker 1: maintain them. Well, I don't actually own a yacht at
33:46
Speaker 1: least not yet. Walk me through some of the costs here.
33:49
Speaker 1: If these yachts are just sitting there, what kind of
33:51
Speaker 1: where and tear are they get in? Um? Yeah, Katie,
33:55
Speaker 1: Unfortunately I'm also in the don't own a super yacht
33:58
Speaker 1: club on now. Yeah, I can always save my pennies.
34:03
Speaker 1: Um so. Uh. Anyone who's ever owned any boat, whether
34:07
Speaker 1: it's a little dingy or it's a giant yacht. Knows that,
34:09
Speaker 1: especially if they're in salt water, they are constantly being
34:12
Speaker 1: attacked by a hostile environment. And these these enormous yachts
34:17
Speaker 1: are more like floating hotels than they are just your
34:22
Speaker 1: ordinary boat. They have um, really uh sophisticated like desalinization
34:28
Speaker 1: systems so they can make their own water on transoceanic voyages. Um.
34:34
Speaker 1: They have all kinds of systems. They don't have an engine,
34:37
Speaker 1: they have engine rooms that you walk into, they have
34:40
Speaker 1: control rooms, they have huge staffs, they have state rooms,
34:44
Speaker 1: and you know, with all all the amenities in them. Uh,
34:48
Speaker 1: and just trying to keep them afloat and in good
34:51
Speaker 1: repair takes daily care. And so say the US seizes
34:56
Speaker 1: one of these boats, and then they have to have
35:00
Speaker 1: an entire crew of people maintaining it every day, as
35:05
Speaker 1: though the billionaire still owned it, because of course those
35:08
Speaker 1: people would also have a crew taking care of it.
35:11
Speaker 1: Why don't why doesn't the US just turn around and
35:14
Speaker 1: sell these things? Why why are they in the business
35:16
Speaker 1: of owning and maintaining boats. So this is a really
35:18
Speaker 1: good question. This is something that Stephanie Baker, who reported
35:22
Speaker 1: and wrote this brilliant story got into and the problem
35:26
Speaker 1: is what is the market for a seized Russian super yacht?
35:31
Speaker 1: So let me just back up. The first thing is
35:33
Speaker 1: they actually have to prove who owns it, because it's
35:37
Speaker 1: not like you just kind of walk into the super
35:38
Speaker 1: yacht show room and say I'll take that one and
35:40
Speaker 1: the guy says, you know, what does it take for
35:42
Speaker 1: me to put you in a super yott today? Um,
35:44
Speaker 1: you have to order it. Of course, it's built to
35:46
Speaker 1: your specifications. These things cost hundreds of millions of dollars
35:50
Speaker 1: um and then they're they're built for you. And most
35:54
Speaker 1: of them are not owned outright by the person who
35:58
Speaker 1: buys them. They're bought through shell companies, and sometimes it's
36:01
Speaker 1: a shell company inside a shell company that owns these vessels.
36:05
Speaker 1: And so when the U S comes along and says, well,
36:07
Speaker 1: we're gonna see this because it's owned by a sanctioned
36:09
Speaker 1: Russian billionaire, they have to actually prove it, and that
36:12
Speaker 1: can take a long time. So let's say they actually
36:15
Speaker 1: do prove it or to the satisfaction of a court,
36:18
Speaker 1: and they bring it into port and they are legally
36:21
Speaker 1: allowed to say we have sees this as quote unquote
36:24
Speaker 1: ill gotten gains, and they could sell it. Who's going
36:27
Speaker 1: to buy that thing? As one person told Stephanie, Uh,
36:31
Speaker 1: let's say you buy one of these yachts and you
36:33
Speaker 1: sail it out into Asian waters, you know, outside the
36:36
Speaker 1: reach of the US, and the billionaire comes back and says,
36:38
Speaker 1: I want my boat. Uh. It's it's a risky sort
36:42
Speaker 1: of thing to do. And so it's not that easy
36:44
Speaker 1: to unload them. So it's not that easy to sell
36:48
Speaker 1: them off, I guess unless you are selling them to
36:51
Speaker 1: Russian billionaires, which can't do right now. But who is
36:54
Speaker 1: paying for the upkeep at the end of the day,
36:56
Speaker 1: who is paying for the cruise that maintain these huge,
37:00
Speaker 1: beautiful boats. Well, I'm gonna give everybody listening, yes it's uh,
37:05
Speaker 1: the taxpayers are and um. Stephanie tells the story of
37:09
Speaker 1: this one enormous boat called Amadeia, which the US claims
37:14
Speaker 1: is owned by this Russian gold tycoon named Suleiman Karama
37:17
Speaker 1: who was sanctioned by the US and eighteen and they
37:21
Speaker 1: tracked down this enormous three hundred twenty five million dollar Yeah,
37:25
Speaker 1: it's three hundred and forty ft long. In fact, it's
37:29
Speaker 1: so big that um. In boat parlance, it's not even
37:33
Speaker 1: a super yacht. It's called mega yacht or a giga
37:37
Speaker 1: yacht because it's so big. And they tracked this thing
37:40
Speaker 1: down uh To to Fiji where it was located, and eventually,
37:45
Speaker 1: after this very long you know, back and forth and
37:48
Speaker 1: wrangling and questioning the crew, they hauled this thing back
37:52
Speaker 1: to San Diego and that's where it's sitting in port.
37:56
Speaker 1: The annual cost of keeping the Amadia in port, well
38:00
Speaker 1: they're trying to figure out what to do with this
38:01
Speaker 1: thing is about ten million dollars and that's paid for
38:04
Speaker 1: by the taxpayers. So do the Russian oligarchs to purported
38:08
Speaker 1: owners of these shots, did they have any recourse here?
38:11
Speaker 1: What are they doing? Um? So this is also a
38:15
Speaker 1: really interesting question. A lot of them either don't respond to,
38:21
Speaker 1: you know, request for comment. Of course, I'm I'm really
38:23
Speaker 1: repeating here because this is Stephanie's story. She came on
38:26
Speaker 1: the Big Take podcast today and so I interviewed her
38:29
Speaker 1: UM and she has said, um, that she reached out
38:33
Speaker 1: to some of them that they didn't even answer. Others
38:35
Speaker 1: of them say no, I'm not the owner, and the
38:37
Speaker 1: owner can be a notional other person or it can
38:40
Speaker 1: be a person who's the head of a shell company
38:42
Speaker 1: and say no, no, there's the owner. They just use
38:45
Speaker 1: the boat and so um, it's very complicated about trying
38:49
Speaker 1: to identify that identity, and in part because they don't
38:52
Speaker 1: just come out and say, hey, you took my boat. Yeah,
38:54
Speaker 1: it's a it's interesting story. I didn't even think about it,
38:57
Speaker 1: you know, I just until I read the story. It's like,
38:59
Speaker 1: it's one thing to seize a yacht. It's another thing too,
39:02
Speaker 1: I guess kind of do something with it, you know,
39:04
Speaker 1: either monetize it or I don't know what West Coast about.
39:07
Speaker 1: Thanks so much for joining us. West is the host
39:09
Speaker 1: of Bloomberg's Big Take and again the Big Take story
39:12
Speaker 1: is entitled and Pounded. Russian super yachts are costing millions
39:17
Speaker 1: to maintain. So again and in this story, I saw
39:21
Speaker 1: great photographs of these mega yachts in there, you know,
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Speaker 1: all over the world. One that one is in Spain,
39:25
Speaker 1: one's in the UK, as West was saying, ones docked
39:28
Speaker 1: in in San Diego. Um. And you know, these oligarchs
39:31
Speaker 1: states tried to race out of Russian waters and get
39:33
Speaker 1: the safe waters. Some made it, some did not. Uh,
39:37
Speaker 1: And some had their boats seized here. Uh it's I
39:40
Speaker 1: just thought you could just turn around and just sell it,
39:42
Speaker 1: but apparently that's not the case. There might be some
39:44
Speaker 1: legal issues there that they have to work out, but
39:47
Speaker 1: a fascinating story. Uh. And you can listen to The
39:49
Speaker 1: Big Take podcast on my Heart radio, app, Apple and
39:53
Speaker 1: anywhere else you get your podcast. And you can listen
39:55
Speaker 1: to The Big Take every night at love in pm
39:57
Speaker 1: Eastern on Bloomberg Radio. Thanks for listening to the Bloomberg
40:02
Speaker 1: Markets podcast. You can subscribe and listen to interviews of
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Speaker 1: Apple podcasts or whatever podcast platform you prefer. I'm Matt Miller.
40:10
Speaker 1: I'm on Twitter at Matt Miller nineteen seventy three and
40:14
Speaker 1: on Fall Sweeney I'm on Twitter at pt Sweeney. Before
40:16
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40:19
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