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Market Looks Past April Jobs Report · 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
0:11
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, let's check
0:21
Speaker 1: in with an expert here, Brent Shooty, chief investment strategist
0:24
Speaker 1: for Northwestern Mutual Wealth. About two forty seven billion under management,
0:28
Speaker 1: So they've got a couple of shekels in the game here, Brett.
0:31
Speaker 1: When you see a number like that this morning, you know, exceptional,
0:35
Speaker 1: Miss What did you make of that this morning? Well,
0:40
Speaker 1: I think it's gonna be a blip that's largely forgotten
0:42
Speaker 1: in a few weeks. I mean, everything else is pointing up.
0:45
Speaker 1: I mean even on the labor force, you have strong
0:46
Speaker 1: labor front, you have strong data and other places, and
0:49
Speaker 1: the economic backdrop is incredibly strong, and so you're gonna
0:52
Speaker 1: have more hiring in the coming funds. You know, I
0:54
Speaker 1: think there could be some season of justice in here.
0:56
Speaker 1: So the unadjusted number not to confuse your audience, is
0:59
Speaker 1: actually one million. So data is seasonally adjusted, and when
1:01
Speaker 1: you have all the back and force that you've had
1:03
Speaker 1: over the past few past year or something that could
1:06
Speaker 1: actually cause the seasonal adjustments to make this look a
1:08
Speaker 1: little bit different. The other thing is that you have
1:10
Speaker 1: some level unemployment benefits keeping people back and possibly COVID
1:13
Speaker 1: fille fears. But I think you're gonna get stronger numbers
1:16
Speaker 1: in the future and that's not going to change, and
1:18
Speaker 1: so I think the market will look past it like
1:20
Speaker 1: it is today and continue to push higher because as
1:23
Speaker 1: you mentioned, you're likely to have monetary policy stay strong,
1:26
Speaker 1: and I know you mentioned President Biden coming on talking
1:28
Speaker 1: about fiscal policy. This only makes that more likely that
1:31
Speaker 1: it actually goes through. And so all in all, Um,
1:34
Speaker 1: I would largely strug it off if I were an investor. Yeah,
1:37
Speaker 1: he's we're expecting many moments. So if we cut you off,
1:40
Speaker 1: we cut you short. Then just know that you're being
1:42
Speaker 1: bigfooted by the President of the United States. It's not
1:45
Speaker 1: in any way. It might be just a bit more important,
1:47
Speaker 1: So that's that's okay by me. Well, we're not sure,
1:50
Speaker 1: you know, I have to say you went to um Illinois, right,
1:53
Speaker 1: and then the University of Chicago Booth School for your
1:56
Speaker 1: m b A with high honors. I want to point out,
2:00
Speaker 1: but I'll just say quickly. I don't want to get
2:02
Speaker 1: off on too much of a tangent. But um, here
2:05
Speaker 1: in Germany we would pronounce your name shitta, which means
2:08
Speaker 1: archer or shooter. Just yeah, you're a target hitter, you know, um,
2:16
Speaker 1: a shot caller as we as we might say, Um,
2:20
Speaker 1: what do you think about the trajectory right now the economy.
2:23
Speaker 1: I've talked to so many European economists here who look
2:26
Speaker 1: at the US UM and look at the global economy
2:29
Speaker 1: and say, man, you know we're we're peaking right now,
2:31
Speaker 1: even in terms of corporate earnings, Like this quarter. Next
2:34
Speaker 1: quarter is going to be the peak. And that doesn't
2:36
Speaker 1: mean we're not seeing growth ahead, but it's just not
2:38
Speaker 1: going to be as strong as it has been this quarter. Yeah.
2:42
Speaker 1: I think that's a big debate, and I think we
2:43
Speaker 1: still have a few more strong quarters than what you
2:45
Speaker 1: just mentioned. I'm not for sure when the peak comes,
2:47
Speaker 1: but you have a strong tale one behind you. You
2:49
Speaker 1: have two point two trillion dollars in excess consumer savings,
2:51
Speaker 1: your monetary policy designed to continue pushing the economy in
2:55
Speaker 1: the market tiger as well as fiscal policy. Uh. And
2:57
Speaker 1: so I do think you are in a sick lit upswing. UH.
3:00
Speaker 1: And you mentioned that Germany. I think that's going to
3:03
Speaker 1: be a global upswing. And so one of the areas
3:05
Speaker 1: that's been left behind just a bit they actually had
3:07
Speaker 1: negative GDP in the first quarter was the Eurozone. Um.
3:10
Speaker 1: You're going to be adding Germany in the Eurozone to
3:12
Speaker 1: the strong commentary and the coming future because the vaccinations
3:16
Speaker 1: catching up, and so I think you have plenty of
3:18
Speaker 1: time left in the economic cycle. I think the question
3:21
Speaker 1: is is it too strong? And that's where I'm telling
3:23
Speaker 1: investors that they need to hedge that risk the first
3:25
Speaker 1: time in what fifteen or twenty years, And so you
3:28
Speaker 1: need to own things like commodities, you need to own
3:30
Speaker 1: things like tips um as a just in case, because
3:32
Speaker 1: I think the only thing that would throw this off
3:35
Speaker 1: is an inflation rises too high and becomes more permanent.
3:38
Speaker 1: Now I don't think we're there yet, but I think
3:39
Speaker 1: that's gonna be the big question over the coming quarters.
3:41
Speaker 1: And we have investors that haven't had to do this
3:43
Speaker 1: for twenty years. They've been trained to hedge downside risk.
3:45
Speaker 1: I think you need to hedge upside risk. And one
3:48
Speaker 1: of the reasons why the market probably likes what happened today,
3:50
Speaker 1: as you mentioned, is because this could possibly be a
3:53
Speaker 1: little bit of slowing in demand which will allow the
3:55
Speaker 1: supply side to catch up UM. And so perhaps that's
3:59
Speaker 1: the silver lining and days numbers all right, Brent. So
4:02
Speaker 1: given that backdrop, what are some of the sectors that
4:05
Speaker 1: you think are going to perform. I know there's a
4:07
Speaker 1: kind of a push pool in the marketplace between the
4:09
Speaker 1: folks that have just really relied on this tried and
4:12
Speaker 1: true Amazon apples, you know, big growth stories, and those
4:15
Speaker 1: that have really embraced that the rotation trade into more
4:17
Speaker 1: cyclical names and which have in fact one very well
4:20
Speaker 1: for several quarters. Now, what kind of where were you
4:23
Speaker 1: in that discussion? Yeah, for much of the last year,
4:26
Speaker 1: we've been pushing up portfolios towards cyclicals, towards value, towards
4:29
Speaker 1: small apps, and we're not changing the market is today,
4:32
Speaker 1: as you mentioned, going to towards tech, and I think
4:33
Speaker 1: tech is the slower growth non cypical um growth asset
4:37
Speaker 1: class right now, and so it has done well for
4:39
Speaker 1: the past couple of years, largely because we had a
4:41
Speaker 1: trade war, which knockout cyclicality. If you think about what
4:44
Speaker 1: the trade war is designed to do, was designed and
4:46
Speaker 1: knock out global growth, and it did so. If you
4:48
Speaker 1: do that in economy, that translates to the markets, and
4:51
Speaker 1: so that knocked out value, that knock to cyxicality. Because
4:53
Speaker 1: tech was unimpacted. Then we had COVID head and COVID
4:57
Speaker 1: did the exact same thing. And in many cases what
4:59
Speaker 1: the tail went text story. As we continue to reopen,
5:03
Speaker 1: as the globe reopen, as cyclical growth continues to push higher,
5:06
Speaker 1: you will see value stocks, you will see small cap stocks,
5:09
Speaker 1: you will see cyclical stocks move higher. And I think
5:11
Speaker 1: the world is in such a hurry to end that trade,
5:13
Speaker 1: which gives me a lot of comfort. Um, I still
5:15
Speaker 1: think we have quite a room to run. And typically
5:18
Speaker 1: if investors look back historically, those segments of the economy
5:21
Speaker 1: are those sectors of the market don't begin underperforming until
5:24
Speaker 1: the yield curve inverts or until the sud starts aggressively
5:27
Speaker 1: raising policy, which we're not anywhere near yet. So you
5:31
Speaker 1: advise or oversee retail investment strategy. And and one of
5:36
Speaker 1: the things I often think about is a retail investor,
5:39
Speaker 1: is I want to keep things fairly simple just because
5:42
Speaker 1: I can't be rebalancing all the time. I can't look
5:46
Speaker 1: at the fees constantly, and UM, frankly, I just don't
5:51
Speaker 1: have the time to do it. I guess that's why
5:53
Speaker 1: I'd hire someone like you. But what do you think
5:56
Speaker 1: about retail investors keeping it a little simpler? I mean,
5:58
Speaker 1: are there are there strategy ease that um take a
6:01
Speaker 1: little bit more of the of the constant watching out
6:05
Speaker 1: of it. Uh, you know, I mean, I guess I
6:09
Speaker 1: try to make it simple too, And so we do
6:10
Speaker 1: maintain a diverse, wite PORTFOLO, and then we tilt our
6:12
Speaker 1: portfolio on the directions that we think, Um, there's opportunities
6:15
Speaker 1: to add value above and beyond. And so I'm not
6:17
Speaker 1: suggesting it's it's easy, but it's certainly not as difficult
6:20
Speaker 1: as people what people make it out to be. Uh.
6:22
Speaker 1: And certainly you can buy some mts and some mutual
6:24
Speaker 1: funds and get a long way towards what any professional
6:27
Speaker 1: institutional investor can do. And that's what we do here
6:29
Speaker 1: at Northwestern Mutual. All Right. So one of the concerns
6:34
Speaker 1: Brent and the equity markets is you know, I feeling
6:37
Speaker 1: a little frothy, and they have been for a while.
6:40
Speaker 1: And then you see you know, the maybe exacerbated or
6:42
Speaker 1: highlighted by the mean stock frenzy that we saw several
6:45
Speaker 1: months ago. And then people might point to SPACs as
6:49
Speaker 1: another speculative aspect of this market. How do you how
6:53
Speaker 1: do you kind of frame that up it in your
6:55
Speaker 1: own analysis? Sure, and so I've compared this time period
6:58
Speaker 1: of Night nine a lot, and I think that gives
7:00
Speaker 1: people pause. But it shouldn't because other asset classes like
7:02
Speaker 1: the ones I'm mentioning did well post M things like
7:05
Speaker 1: small caps, of value stocks, things that were out of favor. Um.
7:08
Speaker 1: I do think there is some froth and markets today.
7:11
Speaker 1: The FED actually brought that up yesterday, which actually had
7:14
Speaker 1: my inbox filled this morning. But I agree the Fed.
7:16
Speaker 1: It's and things like SPACs and i pos and mean stocks,
7:19
Speaker 1: maybe in some crypto areas, maybe in some technology companies
7:22
Speaker 1: with no earnings um, and those aren't areas that I'm
7:24
Speaker 1: recommending right now. We're pushing more towards the things that
7:27
Speaker 1: will do better than see earnings growth given the economic
7:29
Speaker 1: environment that we see in the coming quarters. Uh. And
7:32
Speaker 1: so that would be my point number one. Point number
7:34
Speaker 1: two is I know the FED mentioned it and people
7:36
Speaker 1: are concerned, but the Fed isn't changing their stripes. Um,
7:40
Speaker 1: They're going to continue pushing monetary policy. Uh. And to me,
7:44
Speaker 1: their policy is actually causing some of this, but they're
7:46
Speaker 1: not going to stop because they want to accomplish their
7:49
Speaker 1: economic goals, and their economic goals involved not causing a
7:52
Speaker 1: market crash, and so the two are interlinked right now.
7:55
Speaker 1: But I would continue to advise investors to go to
7:57
Speaker 1: things that are a little bit uh, I suppose left sexy.
8:00
Speaker 1: I mean I don't go on calls and never have
8:01
Speaker 1: anybody asking about the bank stock. They're usually asking me
8:04
Speaker 1: about a technology stock. And so there are parts of
8:06
Speaker 1: the market that are still relatively um well valued. In
8:09
Speaker 1: those are the areas that we pushed towards, and I
8:10
Speaker 1: think that's where you need to be for the coming
8:11
Speaker 1: year or two. What are you telling your clients about crypto?
8:15
Speaker 1: I mean, I'm sure that your inboxes is pretty full
8:18
Speaker 1: with crypto questions or or at least you're you know,
8:20
Speaker 1: friends are asking you about it constantly just due to
8:24
Speaker 1: the FOMO, right if they if they've missed out on
8:27
Speaker 1: this incredible rally. On the other hand, comparison can get
8:31
Speaker 1: pretty scary. Yeah, I mean cryptocurrencies, I think we can
8:35
Speaker 1: all go upon have a huge element of speculation to them,
8:39
Speaker 1: and so you know whether that's good or bad is
8:42
Speaker 1: up to the individual investor to decide. Just know that
8:44
Speaker 1: there's high volatility. Uh. And they could be winners or
8:47
Speaker 1: they could be absolute losers. Uh. And there's nine thousand
8:50
Speaker 1: and I believe, and so which one is going to
8:52
Speaker 1: win and which one is going to lose? For me
8:54
Speaker 1: as an investment professional, UM, I don't know how to
8:57
Speaker 1: value cryptocurrency. So it doesn't have earnings, at wan has
9:00
Speaker 1: cash flows. Uh, and so therefore it's hard to value. Now.
9:04
Speaker 1: I know there's the comparisons made to gold and things
9:06
Speaker 1: like that, but keep the mind gold has a hundred
9:08
Speaker 1: year history and was a monetary instrument. The other thing
9:11
Speaker 1: that I'd say, um, is that um, I don't know
9:14
Speaker 1: what moves the macro economically, and so we've run tons
9:17
Speaker 1: of observations and tried to figure out what do they
9:19
Speaker 1: move off award the inflation pages? Are they they move with?
9:22
Speaker 1: Incredibly key point, I think, Brent, that's that's a huge
9:24
Speaker 1: point that we don't hear anyone bring up. I think
9:26
Speaker 1: that's a key takeaway because yeah, you know the fact
9:29
Speaker 1: that there's no earnings and no income. We you get that,
9:33
Speaker 1: but um, no one still can guess yet what's moving them, right,
9:38
Speaker 1: and so you know there could be value here, But
9:40
Speaker 1: I mean I don't know. I mean I can't foresee
9:43
Speaker 1: everything perfectly by any Meannalwise, I wouldn't be talking to
9:45
Speaker 1: do that on a Friday pointing, I'll be doing something else. Umm,
9:47
Speaker 1: but from what I When I don't know how to
9:49
Speaker 1: value something, and when I don't know, um what moves
9:51
Speaker 1: in macro economically, I'm I'm apt to stay away. That
9:53
Speaker 1: doesn't mean other investors shouldn't. Possibly if they want to
9:56
Speaker 1: invest in it, just know that they could lose all
9:58
Speaker 1: their money or they could make a lot of money.
9:59
Speaker 1: That's just what speculation is, and so that's why I
10:01
Speaker 1: think it's appropriate for people who want to do that.
10:04
Speaker 1: I think the price of coin at a moment shows
10:07
Speaker 1: people that there's quite a bit of speculation here. I mean,
10:09
Speaker 1: it's moving up and down, and it actually has some
10:11
Speaker 1: mark up cap bigger than Twitter, bigger than General Motors,
10:13
Speaker 1: bigger than Kraft, heinz Um. So you know it's it's
10:16
Speaker 1: grown large. So all right, Brent, thanks so much for
10:19
Speaker 1: joining us. We appreciate it as always, Brent Shooty. He's
10:22
Speaker 1: a chief investment strategist for Northwestern Mutual Wealth Management. Let's
10:29
Speaker 1: talk M n A here. You know, was a year
10:32
Speaker 1: unlike no other. But what we have right now is
10:35
Speaker 1: stock markets hitting all time highs, interest rates near all
10:39
Speaker 1: time loads. That is usually a good recipe for M
10:42
Speaker 1: and A. Let's check in with Rob Brown. He's a
10:43
Speaker 1: managing director and CEO of North America for Lincoln International. Rob,
10:47
Speaker 1: thanks so much for joining us here. I'd love to
10:49
Speaker 1: just get the thirty thousand foot view from you and
10:52
Speaker 1: M and A guy on what's going on in the
10:55
Speaker 1: M and A market these days. So the thirty thousand
10:58
Speaker 1: foot view is it's the busiest M and A market
11:02
Speaker 1: of my lifetime. And I've been doing this for thirty years.
11:06
Speaker 1: And I think there's kind of three factors. One and
11:10
Speaker 1: you alluded to it in your in your comments a
11:12
Speaker 1: few minutes ago. The amount of money that has been
11:15
Speaker 1: raised in private equity funds and venture capital funds and
11:18
Speaker 1: the amount of money sitting on corporate balance sheets is
11:22
Speaker 1: at all time highs, and the fundraising has been that
11:24
Speaker 1: way for years, and a lot of that's driven by
11:26
Speaker 1: interest rates being so low and people allocating more assets
11:30
Speaker 1: to classes like private equity. So we've had for a
11:33
Speaker 1: while more capital that wants to be put to work
11:36
Speaker 1: than there are high quality companies to buy. So that
11:38
Speaker 1: creates a hot market. What's what's intensified that right now
11:43
Speaker 1: is that you had deals that should have gotten done
11:46
Speaker 1: last year that where COVID impacted in the second quarter
11:49
Speaker 1: performance was COVID impacted and and people pull them off
11:52
Speaker 1: the market. Those deals are springing back, particularly in areas
11:55
Speaker 1: like industrials. And then with the anticipated increasing capital gains taxes,
12:01
Speaker 1: you have sellers of businesses that in a normal gestation
12:05
Speaker 1: period might be selling something in three saying, you know what,
12:09
Speaker 1: if cap gains rates are going to go up, I'm
12:13
Speaker 1: going to sell it now. So you have this perfect
12:16
Speaker 1: storm that's creating unprecedented activity and unprecedented values of just
12:21
Speaker 1: a great market with lots of capital, but intensified that
12:23
Speaker 1: you've got deals pulled in from uh future years and
12:27
Speaker 1: deals that should have got done last year hitting the
12:29
Speaker 1: market now, which creates really incredible activity. Rob does it
12:33
Speaker 1: also create um unprecedented prices because if you've got more
12:38
Speaker 1: capital out there, too much capital for the amount of
12:42
Speaker 1: high quality companies, then I guess you have to compete
12:45
Speaker 1: more and you do that through raising your You're you're
12:48
Speaker 1: exactly right. It's classics supply and demand, right, the the
12:51
Speaker 1: demand to buy high quality businesses exceeds the supply, and
12:56
Speaker 1: as a result, um, you're seeing incredibly high value and
13:00
Speaker 1: not just you know values and technology and healthcare and
13:02
Speaker 1: the secular growing industries have always been high and now
13:06
Speaker 1: they're they're kind of off the charts high. But even
13:09
Speaker 1: you know, industrials and certain elements of consumer particularly direct
13:12
Speaker 1: the consumer things and business services, all of those are
13:17
Speaker 1: are are also trading at high value. So a good
13:20
Speaker 1: a good portion of it is exactly right, it is
13:24
Speaker 1: and and quite frank, with all the stimulus coming into economy,
13:27
Speaker 1: companies are performing well. So you have this capital and balance,
13:31
Speaker 1: you have strong performance, and it's resulting in high activity
13:34
Speaker 1: and high values. All right, Rob, talk to us about
13:37
Speaker 1: the actually getting deals done. Guys like you, M and
13:40
Speaker 1: A bankers, investment bankers. They've been known to spend most
13:44
Speaker 1: of their weeks, most of their months most of their
13:46
Speaker 1: years on a plane visiting clients. Yet you've most you
13:50
Speaker 1: and your other bankers have been kind of stuck at
13:52
Speaker 1: home for the most part. Yet we're still seeing record
13:55
Speaker 1: volume of deals getting done. Is your business change forever? Uh,
14:01
Speaker 1: that's that's a great question. What I can tell you is,
14:05
Speaker 1: I think all of us in the M and A
14:07
Speaker 1: ecosystem have were incredibly surprised at how quickly buyers and
14:13
Speaker 1: sellers adapted to a virtual environment. And that's starting the
14:16
Speaker 1: thaw right. We're now starting to have more meetings with
14:18
Speaker 1: management teams in person when we're bringing buyers and sellers together.
14:21
Speaker 1: We're starting to meet with clients more in person. But
14:24
Speaker 1: for the last you know, fourteen months, thirteen months, it
14:28
Speaker 1: was really incredible how quickly things went virtual, how comfortable
14:33
Speaker 1: buyers got doing most of their diligence offsite, how comfortable
14:37
Speaker 1: sellers got, you know, interacting with their ultimate buyers um virtually.
14:42
Speaker 1: In fact, we've had several companies in the last year,
14:45
Speaker 1: several deals in the last year where the buyers and
14:48
Speaker 1: sellers never met in person ever until the deals were closed.
14:53
Speaker 1: It's amazing and I'm sure that to some extent, your
14:55
Speaker 1: your wives or your husbands or your kids are gonna
14:58
Speaker 1: get used to that and say, like Dad, you don't
15:00
Speaker 1: need to travel this much anymore. This is Is it
15:02
Speaker 1: a permanent change to some extent? Is there something? I
15:05
Speaker 1: think some of it is. You know, it's interesting. We're
15:07
Speaker 1: looking to bring all of our people back, and you know,
15:09
Speaker 1: we've got twenty three We've got twenty three office in
15:11
Speaker 1: seventeen countries, We've got hundreds of employees around the globe
15:15
Speaker 1: and we're starting to talk about re entry because we
15:18
Speaker 1: value the cultural effect of being together and being in person,
15:21
Speaker 1: and our clients value it. But what's clear is we
15:24
Speaker 1: survey our employees and they value that. They want to
15:26
Speaker 1: come back and be in person, but they want more flexibility.
15:29
Speaker 1: They don't want to be in person as much as
15:31
Speaker 1: they were, And I think employers are gonna have to
15:34
Speaker 1: listen to that. I think there's gonna be some sort
15:37
Speaker 1: of hybred and I think it's going to be unlikely
15:40
Speaker 1: that we go back to the level of travel and
15:42
Speaker 1: the level of in person meetings that we had pre pandemic.
15:44
Speaker 1: All right, Rob, thanks so much for joining. So we
15:46
Speaker 1: always appreciate getting your update market red hot. As Rob said,
15:50
Speaker 1: he has never worked harder in his thirty year career.
15:52
Speaker 1: That's really fascinating. Rob Round, Managing director and CEO of
15:56
Speaker 1: North America for Lincoln Internationally. Getting an update on the
16:00
Speaker 1: M and A market. Now, let's bring in Lauren Sour
16:06
Speaker 1: She is an associate professor at Johns Hopkins University of
16:10
Speaker 1: Emergency Medicine, to talk a little bit about the vaccine
16:13
Speaker 1: or LOOT. We just got UM uh what we call
16:16
Speaker 1: a red sticky headline here, Lauren, which means it's bright
16:20
Speaker 1: red on your Bloomberg terminal and it stays there for
16:22
Speaker 1: a little while because it's very important. The w h
16:25
Speaker 1: O has approved emergency use of Sino farms COVID nineteen vaccine.
16:32
Speaker 1: How much does this help UM? I think any vaccine
16:36
Speaker 1: that has added helps. I think understanding the efficacy data
16:40
Speaker 1: that we have so far is really important for every
16:43
Speaker 1: vaccine that we bring on UM in the Sino farm situation.
16:48
Speaker 1: I think looking at what's happening in the space shows
16:50
Speaker 1: looking at a couple other places where we might be
16:52
Speaker 1: seeing vaccine breakthrough. It's going to be really important over
16:55
Speaker 1: the next few months. And then taking those data and understandings,
16:58
Speaker 1: do we need to add booster is do we need
17:00
Speaker 1: to get additional coverage for people who receive sign A
17:03
Speaker 1: farm or is it, you know, equally as effective. Um,
17:06
Speaker 1: and we can continue to move forward with it. But
17:08
Speaker 1: any vaccine with with with efficacy is going to be
17:12
Speaker 1: a valuable tool in our toolkit right now. So it's interesting. Uh. Yeah,
17:18
Speaker 1: I'm just thinking about the Mets and the Yankees. They
17:20
Speaker 1: are giving out shots to people that come to the game,
17:24
Speaker 1: and I think it's gonna be the COVID one. I
17:25
Speaker 1: mean the one shot J and J shot, And well
17:28
Speaker 1: that's great. I'm thinking, isn't the COVID isn't that type
17:32
Speaker 1: of supply better used in another market like India that
17:36
Speaker 1: really really needs it? So I guess my question to you,
17:40
Speaker 1: professor is just how do we think about dealing with
17:44
Speaker 1: India and some of these other countries like Brazil and
17:47
Speaker 1: other parts of Latin America that are just desperate need um.
17:50
Speaker 1: It just seems like it's such a difficult problem. Yeah. Absolutely,
17:54
Speaker 1: it is a difficult problem, and I think, um, anything
17:57
Speaker 1: we can do to contribute to the global allocation of
17:59
Speaker 1: that scenes is is something that we should be considering,
18:03
Speaker 1: not just in the future once we're totally vaccinated but
18:06
Speaker 1: right now, in the immediate present, sharing vaccines with the
18:10
Speaker 1: world is good practice. UM, it's good, it's good safety
18:13
Speaker 1: for US as a nation, and and it is good
18:15
Speaker 1: diplomacy as well. But right now it's an important public
18:18
Speaker 1: health problem that we should be contributing to. I mean,
18:21
Speaker 1: I think Johnson Johnson has real utility in our own communities.
18:26
Speaker 1: We have a lot of people who, um, we know
18:28
Speaker 1: are not able to easily get two doses of vaccine,
18:31
Speaker 1: who may not have the capacity to come back for
18:34
Speaker 1: that follow up visit. So anything we can do to
18:36
Speaker 1: get an effective vaccine into someone's arm is important here
18:40
Speaker 1: and abroad UM in India, in places where they're having um,
18:44
Speaker 1: these massive outbreaks UM and these crushing caseloads. It's it's
18:49
Speaker 1: about getting the additional health care resources that they need
18:52
Speaker 1: right in this immediate present. So um, you know, things
18:55
Speaker 1: like oxygen, things like additional bed capacity, UM, maybe even
18:59
Speaker 1: personnel to support the response there is going to be
19:02
Speaker 1: what's important in saving lives right now. I think getting
19:05
Speaker 1: vaccine to India is crucial. UM. Making sure that we're
19:08
Speaker 1: vaccinating populations there while responding to this immediate disaster is
19:13
Speaker 1: going to be very very important. But what their current
19:16
Speaker 1: needs are are the ability to take care of their
19:18
Speaker 1: crushing health care volumes. So having said that, I wonder
19:24
Speaker 1: what your thought is on the i P debate right now. UM,
19:28
Speaker 1: the Biden administration has suggested that it could wave i
19:32
Speaker 1: P protections so that uh more producers could get these
19:37
Speaker 1: vaccines out and ostensibly into arms. I'm Glamericle here in Germany,
19:42
Speaker 1: on the other hand, has pushed back pushed back against that,
19:46
Speaker 1: saying that the plan would create severe complications for the
19:48
Speaker 1: production of vaccines, especially be a future pandemic. Drug makers
19:52
Speaker 1: not want may not want to work as aggressively on
19:55
Speaker 1: on on developing them. How do you feel about this? Yeah,
20:00
Speaker 1: I have mixed feelings on the IP issue. I actually
20:02
Speaker 1: don't think that i P is the number one biggest
20:05
Speaker 1: barrier or even three or four or five of the
20:07
Speaker 1: biggest barriers. UM. The i P piece is a very
20:11
Speaker 1: specific part of um the efficacy you know, of getting
20:15
Speaker 1: these vaccines into arms. And UM, I think a lot
20:19
Speaker 1: of the vaccines are new technologies and so just turning
20:22
Speaker 1: off the I T protections is not going to mean
20:25
Speaker 1: that another vaccine maker or producer is going to be
20:28
Speaker 1: able to just quickly flip the switch and and create
20:31
Speaker 1: these vaccines. I think the bigger issue is UM scaling
20:35
Speaker 1: up all the additional elements, looking for the people who
20:38
Speaker 1: UM who can actually give the vaccines, making sure that
20:42
Speaker 1: we have the populations to receive the vaccines. So I
20:45
Speaker 1: think this is a little bit of a distracting conversation
20:48
Speaker 1: right now, I don't think I think it's an important conversation.
20:51
Speaker 1: But in the in sort of the emergency phase, I
20:54
Speaker 1: think the bigger pieces how can we actually scale up vaccines,
20:58
Speaker 1: sharing and production in ways that UM don't require you know,
21:02
Speaker 1: lengthy core battles or massive amounts of international diplomacy to
21:07
Speaker 1: get everyone on the same page. UM. We can make
21:09
Speaker 1: production facilities more readily available. We can use the Defense
21:12
Speaker 1: Production Act. UM. We can give the companies that are
21:15
Speaker 1: already making the vaccines the resources to scale up UM
21:19
Speaker 1: rather than just insisting that they share their their i
21:22
Speaker 1: P and and release their their relax their patents. And
21:26
Speaker 1: I think UM having that conversation and emergency can be
21:30
Speaker 1: really risky because it can it can make companies hesitate
21:34
Speaker 1: to put I P forward in a time where we
21:37
Speaker 1: need it, you know, urgently, Lauren, in this country, what
21:41
Speaker 1: are we seeing in terms of vaccine hesitancy. I know
21:44
Speaker 1: that was a concern early on. What's the data actually
21:47
Speaker 1: showing you? I think, UM, I think we're still making progress.
21:53
Speaker 1: I think we've all seen you know that vaccine uptakes
21:57
Speaker 1: slow down UM in the US. I think are our
22:00
Speaker 1: focus is really gonna have to be to target these young,
22:03
Speaker 1: healthy people who don't necessarily feel like they need vaccine
22:07
Speaker 1: UM to go out and live their lives right now,
22:09
Speaker 1: and and they are going to be at higher risk,
22:12
Speaker 1: and they're also going to create additional risk for vulnerable populations,
22:15
Speaker 1: and so that hesitancy has to be addressed readily so
22:18
Speaker 1: that we can um really create that path to hurt
22:22
Speaker 1: immunity and too UM good vaccine coverage that we know
22:25
Speaker 1: will allow us a path out of the pandemic. I
22:29
Speaker 1: also think that UM, when we're thinking about hesitancy, we
22:33
Speaker 1: also have to couple it with access. And I sort
22:35
Speaker 1: of feel like a broken record in this space. But
22:37
Speaker 1: if we reduce someone's hesitancy and convince them to get
22:40
Speaker 1: a vaccine, we have to make cash are ensure that
22:43
Speaker 1: they have a direct path to that vaccine, because if
22:46
Speaker 1: they have to then go looking for it, UM, we
22:49
Speaker 1: might lose them again, and then that conversation door might
22:52
Speaker 1: be closed. All right, Lauren, thanks very much for joining
22:55
Speaker 1: us on this issue. Hopefully things getting better, but out
22:59
Speaker 1: of here there are still m hurdles which we have
23:02
Speaker 1: to overcome. Lawrence Sour is an associate professor of emergency
23:06
Speaker 1: Medicine at the Johns Hopkins University. Now we have a
23:12
Speaker 1: great new vertical. Do we call it a vertical? I'm
23:15
Speaker 1: not always sure I'm using that work right, but I
23:17
Speaker 1: think that's right in any case. Um, if you type
23:19
Speaker 1: ni big take on your Bloomberg terminal, Um, we have
23:23
Speaker 1: a fantastic new sort of cross platform big story UM
23:28
Speaker 1: that we're all following today. The big take is about
23:32
Speaker 1: Vancouver becoming, at least for now, the capital of anti
23:37
Speaker 1: Asian hate crimes. It's it's a real problem. Joining us
23:41
Speaker 1: for that is Natalie Obeko Pierce and she's Bloomberg Vancouver
23:45
Speaker 1: Bureau chief. Um, so how did this happen? Natalie? Mean,
23:51
Speaker 1: I wouldn't think of Canadians in this way? I guess
23:54
Speaker 1: you know, I don't actually know that many Canadians. But um,
23:58
Speaker 1: what's going on there that makes it so dangerous for Asians? Well,
24:02
Speaker 1: You're absolutely right. I think it's actually going to come
24:04
Speaker 1: as a shock to the city as well, because not
24:06
Speaker 1: only is this Canada, but this is the most liberal
24:08
Speaker 1: corner of Canada, supposedly the most progressive and multicultural. But
24:12
Speaker 1: what's really happening here is, um, you know, like many places,
24:16
Speaker 1: COVID was the trigger, but something had been going on
24:19
Speaker 1: for decades before that. There had been a resentment attention
24:22
Speaker 1: that was building in this city because few cities, I think,
24:27
Speaker 1: have been so visibly and dramatically transformed by Asian immigration
24:31
Speaker 1: as Vancouver has in recent decades. It went from being
24:35
Speaker 1: this sort of struggling industrial backwater into this sort of
24:39
Speaker 1: glittering cosmopolis of shiny condos and designer boutiques and supercars,
24:44
Speaker 1: and that has created attention here. Um, I would say,
24:49
Speaker 1: you know, an Asian traditionally perceived as like an immigrant underclass,
24:54
Speaker 1: suddenly became perceived as these wealthy elites, like with like
24:59
Speaker 1: rank orp inducing types of riches, and so I think
25:02
Speaker 1: when COVID came along, it's sort of tipped tapped into
25:05
Speaker 1: these underlying sentiments, and so that's why he's gotten this
25:09
Speaker 1: huge spike. Yeah, So not only I'm glad you brought
25:12
Speaker 1: that up because you know, the first time I've visited
25:15
Speaker 1: Vancouver for business maybe years ago, I was shocked to
25:18
Speaker 1: see how many agents were in fact in the city
25:21
Speaker 1: and how well they seem assimilated. But was that just
25:24
Speaker 1: the surface, and as you're suggesting, there are some some
25:27
Speaker 1: tensions underneath that I've always been there, and I think
25:31
Speaker 1: that's precisely it. I mean, visibly it is. It is
25:33
Speaker 1: an incredibly multicultural place. I mean, there are parts of
25:36
Speaker 1: the city, you know, where the ethnic Chinese component is
25:41
Speaker 1: fifty four percent. There's sort of this running joke that
25:44
Speaker 1: if you go south of the city to this place
25:46
Speaker 1: called Richmond, it's like going to Hong Kong without having
25:49
Speaker 1: to pay for the air fair. You know, you step
25:50
Speaker 1: off the train and there's Asian signs everywhere. It's sort
25:53
Speaker 1: of difficult to spot English on the store shop fronts.
25:56
Speaker 1: The food is incredible, um but I think you know
25:59
Speaker 1: that that that's sort of the good side of it.
26:02
Speaker 1: But the flip side was that it really has changed
26:05
Speaker 1: the demographics in the city over just probably two to
26:08
Speaker 1: three decades UM and especially this sort of wealth that
26:12
Speaker 1: came in. UM, it drove up housing prices. It it
26:16
Speaker 1: sort of made the city unrecognizable to a lot of people.
26:21
Speaker 1: So what can be done about it? I mean, especially
26:24
Speaker 1: now that we are I guess a silver lining of
26:27
Speaker 1: this pandemic, certainly in the US, has been that we've
26:31
Speaker 1: shown a light on um, the the racism that in
26:37
Speaker 1: this exists inherently institutional racism. And I guess it's not
26:40
Speaker 1: really the pandemic as much as it has been the
26:42
Speaker 1: killing of George Floyd. Um is that being mirrored in
26:46
Speaker 1: Canada as well? Is this incredible concern for social justice grow?
26:51
Speaker 1: Has it grown there as well? Yeah? I think you know,
26:54
Speaker 1: this is actually I think a real cautionary tale because
26:57
Speaker 1: I would say that, you know, Canadians are very like
27:00
Speaker 1: sort of social justice. Um, it is very much front
27:03
Speaker 1: and center and sort of Trudeau when he was when
27:06
Speaker 1: when these reports were coming out of Vancouver last year,
27:08
Speaker 1: was like, this is not Canada, Like, this is not
27:11
Speaker 1: who we are and people will very publicly condemn it.
27:14
Speaker 1: But if you kind of look at what happens in
27:15
Speaker 1: this city, it's very much so. Um. The government policies
27:21
Speaker 1: help and and the media here helped stoke these sentiments,
27:25
Speaker 1: and you realize how easy it is for certain narratives
27:29
Speaker 1: to take hold and to be fueled because of very
27:33
Speaker 1: very tricky issues like a housing affordability crisis, which has
27:37
Speaker 1: so many things playing into it. You know, it has
27:40
Speaker 1: interest rates, and it has UH supply issues and all
27:43
Speaker 1: the rest of it. And when you don't have an
27:46
Speaker 1: easy answer, it's very easy to sort of turn to
27:49
Speaker 1: escapegoat somebody something that can explain what's happening. I think
27:53
Speaker 1: that's precisely what happened here, and so there's probably gonna
27:55
Speaker 1: be I would say a fair amount of soul searching.
27:57
Speaker 1: In fact, the Attorney General uh US recently apologized for
28:01
Speaker 1: comments he had made in recent years in which he
28:04
Speaker 1: sort of helped create this um sentiment, this sort of
28:07
Speaker 1: anti Chinese money sentiment, and regrets sort of because some
28:11
Speaker 1: of the things that he said. So Natalie was suggesting
28:15
Speaker 1: that the COVID maybe you know, one of the catalysts here,
28:18
Speaker 1: was that a byproduct of perhaps President Trump and his
28:21
Speaker 1: characterization of the COVID, that the pandemic the virus as
28:25
Speaker 1: that China virus. Was that some blowback there? Yeah, I
28:29
Speaker 1: mean I think you know, one hand, Canadian sort of
28:32
Speaker 1: looked at the U S under Trump, aghast and and
28:36
Speaker 1: you know, cent ourselves at partents that we would never
28:38
Speaker 1: call it the China virus. And yet I think there
28:41
Speaker 1: were reasons geographically where people thought that we might be
28:45
Speaker 1: particularly vulnerable to becoming an epicenter here, in part because
28:49
Speaker 1: you know, the virus very early in was first spreading
28:53
Speaker 1: beyond China, and we have the most international flights to
28:57
Speaker 1: mainland China out of any airport in the Americas or Europe.
29:01
Speaker 1: So just you know, not not a not a racist thing,
29:04
Speaker 1: but just by purely geographic seeing people people wondering is
29:07
Speaker 1: it going to be coming across and landing in Vancouver
29:09
Speaker 1: because of all these flights, it hasn't been coming without
29:12
Speaker 1: us realizing it. Uh. It actually turned out later if
29:15
Speaker 1: you looked at the epidemiological studies that the variants that
29:19
Speaker 1: spread here didn't come from that route. It was coming
29:21
Speaker 1: from eastern Canada and Europe and from Washington State. But
29:26
Speaker 1: that was sort of the sentiment. It's pretty amazing, I mean,
29:29
Speaker 1: considering the virus did originate in Wuhan, China. It does
29:33
Speaker 1: come from China, so the fact that it didn't spread
29:36
Speaker 1: there when you have so many flights is is pretty interesting. Um. Nonetheless,
29:41
Speaker 1: the issue remains that it could be one of those
29:44
Speaker 1: things that stoked more anti Asian hate and more of
29:49
Speaker 1: the crime. That's just even difficult to read about. Frankly,
29:53
Speaker 1: in the story, Um, what kind of response have you gotten?
29:59
Speaker 1: I think this is actually going to come as a shock, Like,
30:02
Speaker 1: I don't think people it's been reported that their hate
30:04
Speaker 1: crime incidents here's but nobody's yet put it in perspective
30:07
Speaker 1: that we are actually the hate crime capital of the world.
30:09
Speaker 1: So I'm expecting the response later today when people wake
30:12
Speaker 1: up to read it. That's right, all right, Natalie, thank
30:15
Speaker 1: you so much for coming on and sharing this story
30:18
Speaker 1: with us. Natalie Obigo Pearson, she's the Vancouver bureau chief
30:22
Speaker 1: for Bloomberg News, out with a fascinating story here today,
30:25
Speaker 1: a Bloomberg Big Take story entitled Vancouver becomes Capital of
30:30
Speaker 1: anti Asian hate crimes. Uh. You know, obviously that is
30:33
Speaker 1: a big issue here in the United States. But again,
30:36
Speaker 1: as we see from Natalie's reporting from Vancouver, Vancouver is
30:41
Speaker 1: a very has a very big Asian population, has for
30:45
Speaker 1: some time now when they're starting to see uh, some
30:48
Speaker 1: significant rising hate crimes there. So Natalie details that in
30:51
Speaker 1: her very well reported story. We recommend you take a
30:54
Speaker 1: look at that on Bloomberg dot com. Thanks for listening
30:57
Speaker 1: to the Bloomberg Markets podcast. You can subscribe. I've been
31:00
Speaker 1: listening to interviews with Apple Podcasts or whatever podcast platform
31:04
Speaker 1: you prefer. I'm Matt Miller. I'm on Twitter at Matt
31:07
Speaker 1: Miller three. Put on fall Sweeney. I'm on Twitter at
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Speaker 1: pt Sweeney before the podcast. You can always catch us
31:14
Speaker 1: worldwide at Bloomberg Radio.