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0429FullPodcast · Bloomberg Intelligence

• 0:00
  Speaker 1: Welcome to the Bloomberg Markets Podcast. I'm Paul Sweeney, alongside
• 0:04
  Speaker 1: my co host Matt Miller. Every business day we bring
• 0:06
  Speaker 1: you interviews from CEOs, market pros, and Bloomberg experts, along
• 0:11
  Speaker 1: with essential market moving news. Find the Bloomberg Markets Podcast
• 0:15
  Speaker 1: on Apple podcast or wherever you listen to podcasts, and
• 0:18
  Speaker 1: at Bloomberg dot com slash podcast. Another thing we gotta
• 0:23
  Speaker 1: keep our eye on is the currency picture. Some weakness
• 0:25
  Speaker 1: in the dollar today. A lot of that story is
• 0:28
  Speaker 1: coming from Assia actually, and some stimulations coming from Asia.
• 0:32
  Speaker 1: We'll start there and then we're gonna migrate over to Europe.
• 0:34
  Speaker 1: But to do that we bring in Christine A. Tino.
• 0:37
  Speaker 1: She is the head of our FX rates and e
• 0:39
  Speaker 1: M coverage at Bloomberg News, sitting in the heart of
• 0:42
  Speaker 1: the f S base little city of London. Of course, Christine,
• 0:45
  Speaker 1: thank you as always for joining us. The currency picture
• 0:48
  Speaker 1: has been wild this week, and I really want to know,
• 0:51
  Speaker 1: just in your professional opinion, what is really standing out
• 0:55
  Speaker 1: to you. Well, pretty I think it really is just
• 0:58
  Speaker 1: the play look of previous years really doesn't work anymore
• 1:03
  Speaker 1: when it comes to the currency markets, because, as you say,
• 1:06
  Speaker 1: on a day like today, when there's a lot of
• 1:07
  Speaker 1: risk aversion. You would expect the dollar to be up,
• 1:10
  Speaker 1: but clearly it is not, and that has been a
• 1:13
  Speaker 1: function more of just how much dollar has risen over
• 1:16
  Speaker 1: the past week that today seemed like, as you say,
• 1:19
  Speaker 1: a good time to take some money off the table.
• 1:21
  Speaker 1: But yeah, I think it's really you know, I've been
• 1:24
  Speaker 1: looking at these markets for the last ten years, aging
• 1:28
  Speaker 1: myself here a little bit, but it's it's it's written
• 1:31
  Speaker 1: really a wild time and even I myself am having
• 1:35
  Speaker 1: to rethink just how to look at these markets because
• 1:39
  Speaker 1: it's really nothing that we've seen before. It's definitely the
• 1:41
  Speaker 1: post pandemic, post uh stagsflation risk sort of environment now
• 1:48
  Speaker 1: that is really quite unique. You know, I'm curious Christine
• 1:50
  Speaker 1: about Russia for a moment here, because they owe the
• 1:54
  Speaker 1: world to money and for now they can still in
• 1:57
  Speaker 1: theory pay creditors back. And we have news out that
• 2:00
  Speaker 1: said Russia moves to dodge to default with a new
• 2:02
  Speaker 1: claim on a dollar payment made. What are the ramifications here?
• 2:06
  Speaker 1: How much longer can they keep making these payments in theory. Well, Sally,
• 2:11
  Speaker 1: I think this development is really important to pay attention
• 2:14
  Speaker 1: to because up until today, when we got this news.
• 2:18
  Speaker 1: It was actually difficult for Russia to UM make those
• 2:21
  Speaker 1: payments because of the various stipulations from the U. S
• 2:25
  Speaker 1: Government as well as other governments around the world, essentially
• 2:28
  Speaker 1: stopping them from making these payments in dollars. And this
• 2:31
  Speaker 1: is a crucial distinction because uh they had previously tried
• 2:35
  Speaker 1: to make this payment in roubles, but of course these
• 2:38
  Speaker 1: bonds specifically, it's in the legal documents of the bond
• 2:42
  Speaker 1: saying that they cannot do that. And we've had um
• 2:45
  Speaker 1: a several committee, several ratings companies weighing in saying that
• 2:49
  Speaker 1: potentially that brings them closer to default. So this is
• 2:53
  Speaker 1: a bit of a game changer that they are claiming
• 2:56
  Speaker 1: they have made these dollar payments. Of course we need
• 2:58
  Speaker 1: to find out from the very as other stakeholders, the
• 3:01
  Speaker 1: bond holders themselves, the banks involved in this process, and
• 3:04
  Speaker 1: of course the government is watching to see whether this
• 3:07
  Speaker 1: is actually possible. Very crucial day to watch is made
• 3:10
  Speaker 1: the fourth, that was meant to be the end of
• 3:13
  Speaker 1: the grace period for these big bonds that Russia is
• 3:15
  Speaker 1: trying to make payments on. Incidently, that is also a
• 3:18
  Speaker 1: Star Wars day for any of the Star Wars fans
• 3:21
  Speaker 1: out there, I need to watch that movie. Um So.
• 3:25
  Speaker 1: The other thing about this, though, is that listen, So
• 3:29
  Speaker 1: Russian bonds, right, certain sovereign bonds, so foreign denominated bonds,
• 3:32
  Speaker 1: So the dollar denominated bonds had really sold off earlier
• 3:36
  Speaker 1: this year, and some of them have bounced back a
• 3:40
  Speaker 1: little bit. There's a really controversial thing happening in the market, Christine,
• 3:43
  Speaker 1: where some people are saying, do we buy in because
• 3:46
  Speaker 1: Russia is making its payments? Ay, how controversial is that?
• 3:50
  Speaker 1: And be uh you know again, how long can they
• 3:54
  Speaker 1: keep making these payments for given that Russia is saying
• 3:56
  Speaker 1: the US is trying to force it into a default. Well,
• 4:00
  Speaker 1: I think there's a lot of controversy, of course, just
• 4:03
  Speaker 1: as an investor and being out there saying that, yes,
• 4:06
  Speaker 1: I'd happily buy Russian bonds just from uh, I suppose
• 4:10
  Speaker 1: a pr standpoint. But um also, the mechanics of it
• 4:14
  Speaker 1: is quite difficult, because getting ahold of these bonds without
• 4:18
  Speaker 1: breaching sanctions is incredibly difficult at the moment, and also
• 4:23
  Speaker 1: liquidity is very very thin. Of course, you know, when
• 4:26
  Speaker 1: Russia was cut off from the global financial um uh
• 4:30
  Speaker 1: markets with all of these sanctions, it became incredibly difficult
• 4:34
  Speaker 1: to just trade these securities. It was for a time
• 4:38
  Speaker 1: very very difficult to find any buyers for them when
• 4:42
  Speaker 1: holders of these bonds originally we're trying to offload them.
• 4:44
  Speaker 1: So it's a question of both mechanics and also just
• 4:48
  Speaker 1: uh I suppose pr Um standpoint. And now in terms
• 4:53
  Speaker 1: of making these payments again, there's a lot of mechanics
• 4:56
  Speaker 1: involved in this and and a lot of confusion still over.
• 5:00
  Speaker 1: You know, even if Russia attempts to make these payments,
• 5:02
  Speaker 1: will these actually be accepted as legitimate payments? Again, because
• 5:06
  Speaker 1: of the complexity of the whole sanctions regime, and there
• 5:12
  Speaker 1: are many, many lawyers involved who are all trying to
• 5:14
  Speaker 1: figure out what is actually legitimate what would be considered
• 5:17
  Speaker 1: a default. I think May the fourth will be very
• 5:19
  Speaker 1: interesting to watch for sure. May fourth, I believe also
• 5:22
  Speaker 1: the f o MC meeting. And remember, on top of
• 5:24
  Speaker 1: that you have these gas flows. A lot going on
• 5:26
  Speaker 1: here when it comes to the rule payments, and of
• 5:28
  Speaker 1: course we will keep you on that. We're looking at
• 5:31
  Speaker 1: a stronger ruble today, but of course a lot of
• 5:33
  Speaker 1: that coming down from the market. Christina Kino, head of
• 5:36
  Speaker 1: f FX Rates and E M coming out in London.
• 5:38
  Speaker 1: Thank you m these markets. I mean, is it inflation?
• 5:45
  Speaker 1: To Holly, I can't really tell what's driving this because
• 5:48
  Speaker 1: the companies that are driving the sell off are also
• 5:51
  Speaker 1: the company's best positioned to weather some of these issues.
• 5:54
  Speaker 1: So I'm confused. Yeah, I mean, and also you look
• 5:58
  Speaker 1: at kind of the flattening of the yield's curve and
• 6:00
  Speaker 1: end this week, and you wonder what investors are thinking.
• 6:02
  Speaker 1: Are they how worried are they about slowing growth? Is
• 6:04
  Speaker 1: its stagflation? And how much is the our word recession
• 6:08
  Speaker 1: really coming up in conversations in the background. Lots of
• 6:10
  Speaker 1: questions here, yeah, a lot of growth scares and and
• 6:13
  Speaker 1: you know, there's really no one better to break this
• 6:15
  Speaker 1: down with than Mark Stogel, our next guest here, CEO
• 6:18
  Speaker 1: and portfolio manager of Adams Funds. He of course gonna
• 6:22
  Speaker 1: know everything about investing economy, uh the Fed in two Mark,
• 6:28
  Speaker 1: thank you so much for joining us. We really appreciated.
• 6:31
  Speaker 1: Basically you were sold to us as a no all
• 6:34
  Speaker 1: seen all markets gurus. That's where we're going to start
• 6:38
  Speaker 1: with intro. I mean, he's a good he's a good guest.
• 6:41
  Speaker 1: I'm just trying to prepare our audience mark, Why are
• 6:45
  Speaker 1: the markets selling off? What's the problem here? I think
• 6:49
  Speaker 1: it's a couple of things. The first in you in
• 6:52
  Speaker 1: your in your intro, you uh you hit on it UM.
• 6:56
  Speaker 1: There's a lot of uncertainty, and we we've known for
• 6:59
  Speaker 1: forever that the market doesn't like uncertainty. And I think
• 7:03
  Speaker 1: that people have systematically been taking risk off of the table.
• 7:07
  Speaker 1: And part of that is represented in the tech stocks
• 7:11
  Speaker 1: that have that that have gotten hit, and part of
• 7:13
  Speaker 1: that isn't many of the other stocks that have gotten
• 7:15
  Speaker 1: hit UM. And I think that in a in an
• 7:19
  Speaker 1: in an environment where uh, there is there is unknown,
• 7:23
  Speaker 1: and the people are going to take risk off. And
• 7:26
  Speaker 1: I do think that there was a lot made about
• 7:28
  Speaker 1: the tech um tech earnings. I think tech came through it,
• 7:33
  Speaker 1: big tech, big quality tech came through it. UM I
• 7:36
  Speaker 1: think pretty well. I think the challenges now that we've
• 7:39
  Speaker 1: gotten through that, there was I think you you both
• 7:41
  Speaker 1: probably heard the collective side of relief when Avanzade didn't
• 7:44
  Speaker 1: spit it yesterday. I think that was a good thing
• 7:46
  Speaker 1: for the market. But we're gonna roll into next week
• 7:49
  Speaker 1: and the FED is going to be front and center again,
• 7:52
  Speaker 1: and so we go from concerns about technology, about about stocks,
• 7:57
  Speaker 1: about the third year, about about inflation, and then we're
• 8:00
  Speaker 1: going to pivot over next week into the FED. Are
• 8:04
  Speaker 1: they going to raise fifty what are they going to
• 8:05
  Speaker 1: say about next month the June meeting. So there's a
• 8:09
  Speaker 1: significant amount of uncertainty, and in those environments, people are
• 8:14
  Speaker 1: very happy to take some money off the table, and
• 8:16
  Speaker 1: I think that a lot of what you're seeing, it's
• 8:19
  Speaker 1: a lot of money off the table. Really. I mean
• 8:21
  Speaker 1: the fact that we mean, Katty, have been talking about
• 8:23
  Speaker 1: the fact that the monthly decline you're going to see
• 8:25
  Speaker 1: is the worst you've seen since March, that's when COVID
• 8:28
  Speaker 1: came around the US. So you know, that's a really
• 8:31
  Speaker 1: big it's a significant that's a significant move that you're seeing.
• 8:35
  Speaker 1: And to the point you made on technology, I mean Amazon,
• 8:38
  Speaker 1: Amazon is down the most since at least and so
• 8:43
  Speaker 1: what what is going on here? I mean, is this
• 8:45
  Speaker 1: a rerating? Well, I I think it's I think it's
• 8:48
  Speaker 1: a couple of things. And I'm sure both of you
• 8:51
  Speaker 1: have have have seen this study that was done and
• 8:55
  Speaker 1: I and I like to talk. I like to bring
• 8:56
  Speaker 1: it up in situations like this, The average investor that
• 9:01
  Speaker 1: invests in an S and P five hundred index fund
• 9:05
  Speaker 1: never gets that return because they trade it. And I
• 9:09
  Speaker 1: think that's one of the challenges for investors is they
• 9:13
  Speaker 1: do jump out at about the wrong time. And I
• 9:16
  Speaker 1: think that's if you're a long term investor, unless you're
• 9:18
  Speaker 1: a trader. And there's nothing wrong with being a trader.
• 9:20
  Speaker 1: I think that, you know, a lot of people can
• 9:22
  Speaker 1: make money being there. I'm getting them, giving them the
• 9:29
  Speaker 1: benefit of the doubt. But I will tell you most
• 9:31
  Speaker 1: of us are not traders, and we shouldn't be traders.
• 9:34
  Speaker 1: Were not set up to do that. What we are
• 9:36
  Speaker 1: set up to do. We should be able to do
• 9:38
  Speaker 1: is invest with a longer term horizon. And but but
• 9:42
  Speaker 1: a lot of investors are having a hard time do that.
• 9:44
  Speaker 1: They get emotional, they say, wow, you know the FEDS
• 9:47
  Speaker 1: inflation is going to do this. I I know it
• 9:49
  Speaker 1: in my coffee, I know it in my fride lunches
• 9:52
  Speaker 1: that I get, I know it all of these places
• 9:54
  Speaker 1: that that I that that that I've seen, I can
• 9:56
  Speaker 1: see it. So that must be a really bad thing,
• 9:59
  Speaker 1: and it not. It isn't necessarily if you have a
• 10:02
  Speaker 1: one or two or three year horizon, you shouldn't be you.
• 10:05
  Speaker 1: We shouldn't see the redemptions and the outflows as much
• 10:08
  Speaker 1: as we have been. But it's human nature. As much
• 10:11
  Speaker 1: as I like to talk about it and try to
• 10:12
  Speaker 1: convince people that they need to have longer horizons, it's
• 10:15
  Speaker 1: a hard thing to do. Now. Do I think that
• 10:17
  Speaker 1: Amazon had a difficult quarter? I do. I talked about
• 10:21
  Speaker 1: that a lot this morning and earlier, and I think that.
• 10:25
  Speaker 1: But if I was, if I didn't own it, and
• 10:27
  Speaker 1: I was a long term investor, would I begin to
• 10:30
  Speaker 1: buy some Amazon here? I probably would, you know, in
• 10:32
  Speaker 1: this general area, I probably would. And we'll we'll see
• 10:35
  Speaker 1: if other people share that view. Mark Socle, We're always
• 10:39
  Speaker 1: short on time with you, but we really appreciate you
• 10:40
  Speaker 1: joining us CEO and portfolio manager of Adams Funds, talking
• 10:44
  Speaker 1: of course about all things tech and how we sell it.
• 10:50
  Speaker 1: Next week a huge, huge week for markets, the f
• 10:53
  Speaker 1: o MC meeting and the OPAC meeting not getting enough
• 10:56
  Speaker 1: attention in my view that we are coming up on
• 10:58
  Speaker 1: another OPAC meeting at a time when commandity prices remain high,
• 11:03
  Speaker 1: inflation is still high, and a lot of red on
• 11:06
  Speaker 1: the screen coming from growth worries. It's amazing. Uh, energy
• 11:09
  Speaker 1: has politicized, energy is weaponized. It is certainly the story
• 11:13
  Speaker 1: of the year, and and a lot of uncertainty on
• 11:16
  Speaker 1: where oil and gas prices will go. Yeah, and then
• 11:18
  Speaker 1: let's bring it full circle right back here to the
• 11:20
  Speaker 1: equity picture and the earnings picture in particular EXN Mobile,
• 11:24
  Speaker 1: Chevron both reporting some pretty blockbuster profits. I believe the
• 11:28
  Speaker 1: biggest profits going back to I want to over a
• 11:31
  Speaker 1: decade um when it comes to these oil companies, no surprise,
• 11:34
  Speaker 1: able to really take advantage of these higher prices. Let's
• 11:37
  Speaker 1: break it all down with a true expert, Simon Casey,
• 11:40
  Speaker 1: the deputy managing editor of our Bloomberg coverage of our
• 11:44
  Speaker 1: energy commodities coverage. Simon, thank you as always for joining us.
• 11:48
  Speaker 1: We were at Sarah Week a couple of months ago,
• 11:51
  Speaker 1: two months ago, ish um and to our audience, Sarah
• 11:54
  Speaker 1: Week is the largest energy conference I believe in the
• 11:57
  Speaker 1: world's hosted in Houston. All the big wigs from so
• 12:00
  Speaker 1: on to Chevron to OPEC really go there and talk
• 12:03
  Speaker 1: about what's going on. And Simon, from what I remember,
• 12:05
  Speaker 1: the biggest issue there was at a time when we
• 12:08
  Speaker 1: need there was there's all these calls to ramp up production.
• 12:11
  Speaker 1: The energy space in the US or the energy industry
• 12:14
  Speaker 1: in the US are saying, well, we don't have the
• 12:16
  Speaker 1: capacity to do that, just given the legacy of the pandemic.
• 12:21
  Speaker 1: Where are we on that, Oh, that's right. I mean,
• 12:24
  Speaker 1: it's like they said, we can't and in case, we're
• 12:27
  Speaker 1: not really sure we want to, and we're not even
• 12:29
  Speaker 1: sure we're going to be allowed to because investors are
• 12:32
  Speaker 1: going to punish us essentially for for for reacting to
• 12:37
  Speaker 1: to higher prices. You know, two months down the line
• 12:39
  Speaker 1: from that conference, not one has changed any sort of
• 12:44
  Speaker 1: production increases we've seen so far this earning season, I
• 12:47
  Speaker 1: mean pretty sort of incremental. Chevron x On this morning
• 12:50
  Speaker 1: come out with, you know, some pretty impressive results on
• 12:53
  Speaker 1: the whole that they did miss the consensus f for
• 12:57
  Speaker 1: for earnings to share both of them, there are some
• 13:00
  Speaker 1: slight issues there on their refining business, various cost issues,
• 13:05
  Speaker 1: timing issues. I mean, if you can see past that,
• 13:07
  Speaker 1: you know, these are very robust earnings. But they both
• 13:10
  Speaker 1: companies have come out and said we're not planning to
• 13:14
  Speaker 1: spend increased spending at all, and in fact, x On
• 13:16
  Speaker 1: I think is likely down on a on a run
• 13:20
  Speaker 1: rate so far for the first quarter, it's on course
• 13:22
  Speaker 1: to spend below what it was forecasting for the full year.
• 13:26
  Speaker 1: I mean, I'm sure might speed up towards the end
• 13:28
  Speaker 1: of the year. Um Chevron is keeping, you know, keeping
• 13:32
  Speaker 1: spending tight. Um. There's the big scene this morning with
• 13:37
  Speaker 1: our story. We'll be going with us the share buy
• 13:38
  Speaker 1: backs that both companies have have given updates on. XN
• 13:42
  Speaker 1: is tripling its plans shared by back to billion dollars.
• 13:46
  Speaker 1: They have a lot of cash. They are giving no
• 13:48
  Speaker 1: indication they're going to go out and do any deals
• 13:50
  Speaker 1: that would be a surprise, and they're not spending it
• 13:53
  Speaker 1: on capex. They are spending it on buy backs at
• 13:57
  Speaker 1: the moment, and Excells earnings called just ended, and big
• 14:00
  Speaker 1: message from that was also that they are being very
• 14:03
  Speaker 1: conservative on that cash management, that building up reserves. They
• 14:07
  Speaker 1: been through a very difficult to an off your period
• 14:10
  Speaker 1: and they some some valuable lessons for that. I think
• 14:14
  Speaker 1: what's fascinating here and and for our radio listeners worldwide,
• 14:18
  Speaker 1: we want to really emphasize what Simon just brought up there,
• 14:21
  Speaker 1: the idea that this caution in spending really is a
• 14:26
  Speaker 1: byproduct of history, The idea that this is a sector
• 14:29
  Speaker 1: that has been lagging for so long that have investors
• 14:32
  Speaker 1: have really been hesitant to hop into an equity market
• 14:35
  Speaker 1: and the bond market. I might add the energy sector
• 14:38
  Speaker 1: making up I believe a good chunk of the high
• 14:40
  Speaker 1: yield market as well. And this really comes from this
• 14:43
  Speaker 1: idea of drill, baby, drill, and and and this legacy
• 14:46
  Speaker 1: of that. They don't want to go through that because
• 14:48
  Speaker 1: then you get cut off from these funding streams, from
• 14:51
  Speaker 1: these capital markets, and then you can't pay your workers,
• 14:54
  Speaker 1: you can't expand you can't grow, and naturally you get
• 14:57
  Speaker 1: punished for it in the stock market. Simon, Let's talk
• 14:59
  Speaker 1: about the other side of the equation. UM generally at
• 15:02
  Speaker 1: the top of this block said that oil is politicized
• 15:05
  Speaker 1: very often. The Biden administration very vocal about ramping up production.
• 15:10
  Speaker 1: I feel like we've just discussed the internal dynamics of
• 15:13
  Speaker 1: the shale industry. Let's talk about this from the global perspective.
• 15:17
  Speaker 1: An OPEC meeting coming next week. But it seems like
• 15:20
  Speaker 1: this is a problem, This ramp up, this caution is
• 15:22
  Speaker 1: a problem worldwide, from OPEC to Europe to Russia, UM
• 15:27
  Speaker 1: and even the Biden administration. Yeah, I mean, we got
• 15:30
  Speaker 1: that we've we've we're now kind of got used to
• 15:34
  Speaker 1: monthly MOPEC meetings, which is nuts. Then the one next week,
• 15:38
  Speaker 1: um that we expect it will be another routine in
• 15:42
  Speaker 1: production increase in line with what you know, over a
• 15:47
  Speaker 1: year now they've been doing these production increases about four
• 15:50
  Speaker 1: barrels of oil per day extra more or less as
• 15:55
  Speaker 1: OPEC gradually manages this production recovery from the massive cuts
• 16:01
  Speaker 1: they implemented during the early days of pandemic um OPEQ
• 16:07
  Speaker 1: and you know, ope, we largely read Saudi Arabia here
• 16:11
  Speaker 1: the superpower. You know, OPEC has been and eaves continue
• 16:16
  Speaker 1: to be very resistant to demands from from administration to
• 16:20
  Speaker 1: increase production. And you know, the lesson the impact on
• 16:24
  Speaker 1: on the consumers and lower gasoline prices combat inflation. They
• 16:29
  Speaker 1: don't want to hear it. The Saudies are very happy
• 16:32
  Speaker 1: and why wouldn't they be. And we've got a crew
• 16:35
  Speaker 1: prices you around about a hundred dollars right now. Um.
• 16:39
  Speaker 1: You know, Grant is trading up with around a hundred
• 16:41
  Speaker 1: and ten h This this suit Saudi. The Saudi is
• 16:45
  Speaker 1: fantastically because of course, you know, the economy is doing
• 16:49
  Speaker 1: very well. They're no longer having to fund any kind
• 16:52
  Speaker 1: of deficits where compared with all where prices were a
• 16:55
  Speaker 1: year ago. And you know, you're sitting up really well,
• 16:58
  Speaker 1: and I'm wondering if you'll set us up a little
• 17:00
  Speaker 1: more next week ahead of opaque meeting And just thirty
• 17:03
  Speaker 1: seconds here, what are you watching for? The don't fact
• 17:06
  Speaker 1: meeting is going to be pretty perfunctory. I mean, there's
• 17:08
  Speaker 1: always the chance that we can see a surprise, but honestly,
• 17:11
  Speaker 1: it'll be like if the last year has been any guide,
• 17:15
  Speaker 1: It'll be very short, still announced the decision. It's like
• 17:19
  Speaker 1: a rubber stamp essentially. I mean, look beyond that, what
• 17:22
  Speaker 1: we're looking at is really Chinese demand. The lockdown in China,
• 17:27
  Speaker 1: the world's second largest oil market, that's undoubtitely having a
• 17:30
  Speaker 1: major impact on demand. That's God's trade is extremely worried.
• 17:34
  Speaker 1: And then we're looking for further developments in situation regarding
• 17:37
  Speaker 1: Europe and possible sanctions on oil oil Russian oil. I
• 17:42
  Speaker 1: think that that could be really big, fascinating stuff. Simon Caseley,
• 17:46
  Speaker 1: a true expert on the energy and commanding space and
• 17:48
  Speaker 1: deputy managing editor of our energy coverage here in the States.
• 17:52
  Speaker 1: We thank you so much for your time. There's a
• 17:58
  Speaker 1: very special guest here as we talk about the war
• 18:01
  Speaker 1: in Ukraine, as we talk about what the United States
• 18:04
  Speaker 1: can actually do, we have no better guests than James Stravites.
• 18:07
  Speaker 1: Admiral James Trevis, I should say of the United States Navy.
• 18:11
  Speaker 1: He's retired after having spent thirty seven years with them,
• 18:14
  Speaker 1: also a contributor to Bloomberg Opinion. Admiral, thank you as
• 18:18
  Speaker 1: always for joining us. Let's take this conversation very seriously.
• 18:23
  Speaker 1: Is the United States doing everything it can do? Almost
• 18:28
  Speaker 1: We have provided billions of dollars of aid, We have
• 18:33
  Speaker 1: put highly advanced weapons in the hands of the Ukrainians. Um,
• 18:37
  Speaker 1: we have done just about everything we can to. Remaining
• 18:42
  Speaker 1: things that I think you'll see the administration move on
• 18:45
  Speaker 1: fairly soon are providing longer range anti ship missiles. And
• 18:53
  Speaker 1: this is because the Black Sea is important to Russian
• 18:56
  Speaker 1: warships dominated Ukrainians sank one a couple of weeks ago,
• 19:00
  Speaker 1: the flagship. They need more weapons to reach out and
• 19:04
  Speaker 1: touch those worships in the Black Sea. And secondly, they
• 19:08
  Speaker 1: still need high performance combat aircraft so they can control
• 19:13
  Speaker 1: the skies over Ukraine. These will come in the form
• 19:16
  Speaker 1: of mid twenty nine, which will be provided by UM
• 19:20
  Speaker 1: NATO allies, and then we the United States will backfill
• 19:24
  Speaker 1: those two processes I believe are in motion. Um. Other
• 19:28
  Speaker 1: than that, we have done everything we can to put
• 19:31
  Speaker 1: the tools in the hands of the Ukrainians so they
• 19:33
  Speaker 1: can finish the job. You know. Pretty recently you've also written,
• 19:37
  Speaker 1: in addition to kind of you know, speaking about the
• 19:40
  Speaker 1: actual weapons themselves, you've written that the deadliest weapon in
• 19:43
  Speaker 1: Ukraine is a cell phone. What exactly do you mean
• 19:47
  Speaker 1: when this comes to information warfare? Yeah, we are engaged
• 19:51
  Speaker 1: in a real battle for the truth. And what I
• 19:54
  Speaker 1: mean by that is, uh, the war crimes that are
• 19:57
  Speaker 1: being committed every single day by the Russian military, and
• 20:01
  Speaker 1: we've seen powerful evidence of this from places like Busha
• 20:05
  Speaker 1: on the outskirts of Kiev. Where did we get that evidence.
• 20:09
  Speaker 1: We got it from cell phones, from videos taken by
• 20:13
  Speaker 1: ordinary Ukrainians who then used those supercomputers not only to
• 20:18
  Speaker 1: record these crimes, but to upbload them into the Internet
• 20:22
  Speaker 1: move them forward. And we've got to get that information
• 20:26
  Speaker 1: out in the broader world, because although we are convinced
• 20:30
  Speaker 1: in the United States and in NATO and in the
• 20:32
  Speaker 1: Western democracies. There are still big parts of the world
• 20:36
  Speaker 1: in Sub Saharan Africa, Latin America, the Caribbean, South Asia
• 20:41
  Speaker 1: that are as yet not completely convinced about the awful
• 20:45
  Speaker 1: actions of Russia. We need to make that case with
• 20:49
  Speaker 1: those swing voters in that part of the world as well.
• 20:52
  Speaker 1: The cell phone and video can help us do that. Admiral,
• 20:57
  Speaker 1: you also have quite the resume when it comes to
• 21:00
  Speaker 1: NATO as well. We know Sweden Finland looking to join
• 21:04
  Speaker 1: NATO in particular, what kind of reaction can we expect
• 21:09
  Speaker 1: from Russia and arguably from China as well? As we
• 21:13
  Speaker 1: see the NATO presence in the NATO membership growing um.
• 21:19
  Speaker 1: Sweden and Finland have highly, highly capable militaries. They are
• 21:24
  Speaker 1: very advanced economies. These are techno democracies of the first order.
• 21:29
  Speaker 1: I commanded Swedish and Finnish troops. They were under my
• 21:33
  Speaker 1: command in Afghanistan. They were part of the NATO mission
• 21:36
  Speaker 1: to Afghanistan. So the quality of those nations, who also
• 21:42
  Speaker 1: spend a great deal on defense. If you add up
• 21:45
  Speaker 1: the defense budgets of Sweden and Finland, they are about
• 21:49
  Speaker 1: one fourth the budget of Russia. So this would be
• 21:53
  Speaker 1: a significant addition to NATO. In terms of Russian reaction, Uh,
• 21:58
  Speaker 1: the Russians will hate it. And that's a good thing.
• 22:01
  Speaker 1: Vladimir Putin needs to reap what he has sown, and
• 22:06
  Speaker 1: the consequences of evading a democracy like Ukraine are going
• 22:11
  Speaker 1: to be that other. Uh, democracies like Sweden and Finland
• 22:15
  Speaker 1: look at what happened to Ukraine and say, I think
• 22:19
  Speaker 1: I would like a NATO membership card. We had to
• 22:22
  Speaker 1: bring him aboard. I think it'll deter Putin. He'll be angry.
• 22:26
  Speaker 1: There's very little he can do about it. Yeah, I'm
• 22:28
  Speaker 1: wondering if you can, Admiral, give us a little bit
• 22:30
  Speaker 1: of understanding an analysis here about who are actually dealing with?
• 22:34
  Speaker 1: Who is Ukraine dealing with? When it comes to Russia's
• 22:37
  Speaker 1: new commander who had led brutal attacks in Syria before. Yeah,
• 22:42
  Speaker 1: this is General Alexander Nikolaev and he is well known
• 22:47
  Speaker 1: to Western intelligence. His file is stamped on it the
• 22:52
  Speaker 1: Butcher of Syria. He also committed war crimes in Chechnia
• 22:58
  Speaker 1: during the wars there and a previous decade. He is
• 23:01
  Speaker 1: someone who is unfortunately undeterred by international law. He will
• 23:08
  Speaker 1: attack civilian populations, will encourage war criminal behavior, and we
• 23:13
  Speaker 1: don't have to speculate on that because we saw him
• 23:16
  Speaker 1: do it in Syria and he's been hand picked by
• 23:19
  Speaker 1: Putin to continue to attempt to terrorize the Ukrainian population.
• 23:24
  Speaker 1: One more reason we need to stand with the Ukrainians
• 23:27
  Speaker 1: in this fight. Admiral, I want to ask about simply
• 23:33
  Speaker 1: what Putin's thinking is here and the timeline that we're
• 23:36
  Speaker 1: expecting from this war thirty seconds. How long is this
• 23:38
  Speaker 1: warre gonna last? I think it will last months, but
• 23:42
  Speaker 1: not years. Putin is bleeding cash war as hell. It's
• 23:48
  Speaker 1: also expensive. I think in the two to four months range,
• 23:52
  Speaker 1: both parties are going to start looking for a negotiation.
• 23:56
  Speaker 1: Couldn't go longer than that, sure, but I think we're
• 24:00
  Speaker 1: looking at some form of negotiation in the by the
• 24:04
  Speaker 1: end of the summer into the fall. Let's hope for
• 24:08
  Speaker 1: Admiral James Stravitas of Bloomberg opinion columnist and formerly of
• 24:12
  Speaker 1: the Navy, the U. S. Navy and of NATO as well.
• 24:15
  Speaker 1: We appreciate your insight in your analysis. Thanks for listening
• 24:20
  Speaker 1: to the Bloomberg Markets podcast. You can subscribe and listen
• 24:23
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• 24:28
  Speaker 1: I'm Matt Miller. I'm on Twitter at Matt Miller three.
• 24:33
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• 24:35
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• 24:38
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