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Get Ready For Pay Cuts, As Work-From-Home Endures · Bloomberg Intelligence

0:01
Speaker 1: Welcome to the Bloomberg Markets Podcast. I'm Paul Sweeney, along
0:04
Speaker 1: with my co host of Bonnie Quinn. Every business day
0:06
Speaker 1: we bring you interviews from CEOs, market pros, and Bloomberg experts,
0:10
Speaker 1: along with essential market moving news. Find the Bloomberg Markets
0:13
Speaker 1: Podcast on Apple podcast or wherever you listen to podcasts,
0:17
Speaker 1: and on Bloomberg dot com. Well, it's been a head
0:19
Speaker 1: scratcher from the start. Firstly, imperative was to get workers
0:22
Speaker 1: to work from safe places, their homes preferably. Then it
0:27
Speaker 1: was clear this wouldn't be a short term phenomenon, so
0:29
Speaker 1: some workers wanted to swap out those homes for other homes,
0:32
Speaker 1: maybe even other states. But what do the companies do
0:36
Speaker 1: those that are still paying rent for those employees at
0:38
Speaker 1: work spaces. Well, Noah bu Hire is real estate reporter
0:41
Speaker 1: for Bloomberg News. He has the cover story of the
0:43
Speaker 1: new issue of Bloomberg Business Week magazine and it's called
0:47
Speaker 1: the Work from Home Boom is here to stay. Get
0:50
Speaker 1: ready for pay cuts. No, it's a great story. Talk
0:53
Speaker 1: to us about the decisions that companies are having to
0:55
Speaker 1: make now nine months into this pandemic, with no end
0:58
Speaker 1: in sight and the possibility of a very changing geographic workforce. Yeah,
1:05
Speaker 1: thanks for having me on. I I think it's a
1:07
Speaker 1: it's a really interesting question and and a lot of
1:10
Speaker 1: this has been evolving over the course of this year's
1:12
Speaker 1: Companies have have realized that UM workers, their employees can
1:18
Speaker 1: be quite productive at home. They're they're certainly drawbacks and
1:21
Speaker 1: I think we're starting to see that. So what companies
1:24
Speaker 1: are are are starting to do is come up with
1:26
Speaker 1: policies UM that imagine, you know, what the rules of
1:30
Speaker 1: the road are going to be when UM, when offices
1:33
Speaker 1: can be reopened safely? You know, do you have everyone
1:37
Speaker 1: come back UM every day of the week. Are they
1:40
Speaker 1: doing more hybrid schedules coming in a few days a week? UM?
1:43
Speaker 1: And to what extent do you allow workers who want
1:47
Speaker 1: to UM just to move somewhere in in entirely different UM.
1:51
Speaker 1: Maybe it's a small town, maybe it's closer to family,
1:54
Speaker 1: but somewhere that's not so close to the office. Well,
1:57
Speaker 1: there's this new little phrase that's coming in and something
2:00
Speaker 1: tells me that we're all going to be using it
2:02
Speaker 1: very soon, called localized compensation. What is that? Well, it's
2:07
Speaker 1: it's just it's an idea that's been around and been
2:09
Speaker 1: in practice for for a long time. I mean, companies,
2:12
Speaker 1: even the federal government paid different wages for the same
2:16
Speaker 1: work in different places. And and it's just a reality
2:19
Speaker 1: that the cost of labor and the cost of living
2:21
Speaker 1: very um widely across the US. And as a result,
2:26
Speaker 1: UM companies try and pay in accordance with local labor
2:31
Speaker 1: market conditions and with you know, something that would allow
2:35
Speaker 1: their workers, um, if they're you know, professional to live
2:39
Speaker 1: a sort of what we consider a professional lifestyle and
2:42
Speaker 1: fill in the blank city and um, you know, there's
2:46
Speaker 1: data out there, and companies use this data. But now
2:49
Speaker 1: they're having to think about, well, how do we um
2:53
Speaker 1: pay people who make these voluntary moves to places where
2:57
Speaker 1: we may not have an offer? Right, Because if some
2:59
Speaker 1: of what you're pay is based on is the city
3:02
Speaker 1: that your headquarters is in. You can imagine how companies
3:04
Speaker 1: would feel a little odd if if cuddenly you went
3:06
Speaker 1: to a place where the cost of living was half
3:08
Speaker 1: the price or what have you. There's gonna be a
3:10
Speaker 1: lot of litigation about this though, right. I mean, workers
3:13
Speaker 1: are going to make the case that there is them,
3:16
Speaker 1: whether they're in New York City or San Francisco or
3:18
Speaker 1: Montana you know, I think there are a lot of
3:23
Speaker 1: strong feelings about this. I don't know if there's going
3:25
Speaker 1: to be litigation per se. I mean, this is something
3:28
Speaker 1: that's been around for a while, and I think a
3:30
Speaker 1: lot of people who have made these moves, including some
3:32
Speaker 1: of the employees I interviewed from my story, get that
3:35
Speaker 1: if you're living in a place that's cheaper to live,
3:37
Speaker 1: it's there, um in a way to be paid less,
3:42
Speaker 1: and that in many cases um companies are still paying you,
3:47
Speaker 1: uh so that you can afford a similar lifestyle or
3:52
Speaker 1: even a better lifestyle in the place you've chosen to relocate.
3:55
Speaker 1: I mean, how much is a company entitled to know
3:58
Speaker 1: if you if you move back in to your parents,
4:00
Speaker 1: for example, and you're not paying any rent, you're not
4:02
Speaker 1: paying any utilities, or you're just giving your parents. I mean,
4:06
Speaker 1: is that something a company is entitled to take into account?
4:10
Speaker 1: Imagine say those parents who are in a city. Yeah. Yeah,
4:14
Speaker 1: I mean, look, I don't I don't think there's any
4:15
Speaker 1: evidence that that's how these policies are being rolled out
4:17
Speaker 1: in In fact, I mean that sounds like more of
4:20
Speaker 1: a temporary arrangement. And the company I've profiled, Red Finn
4:23
Speaker 1: you know, explicitly says that these temporary moves that are
4:26
Speaker 1: happening during the pandemic, those they're not adjusting pay for
4:29
Speaker 1: those people. They're They're talking about folks who are making
4:32
Speaker 1: a life decision to say, leave New York and moved
4:36
Speaker 1: to Rochester closer to where they have family, and they're
4:39
Speaker 1: settling down there. It's these are these are these are
4:41
Speaker 1: permanent moves. These are not um, you know, I'm trying
4:45
Speaker 1: to keep myself and my family safe during the pandemic.
4:49
Speaker 1: I'm going to leave this town. These are These are
4:51
Speaker 1: people who are making long term decisions. Yeah, it's going
4:54
Speaker 1: to be so interesting to see what human resource departments
4:57
Speaker 1: do after people are vaccinated. I mean, will they hold
5:02
Speaker 1: you know, recruitment events in all sorts of places and
5:05
Speaker 1: be quite happy to to take somebody on staff from
5:08
Speaker 1: a state that is nowhere near a headquarters or even
5:10
Speaker 1: an outpost. It will be interesting to see, Yeah, and
5:14
Speaker 1: I think that's what we're seeing. So yeah, yeah, it's
5:17
Speaker 1: it's fascinating. It gives the American labor force so much
5:19
Speaker 1: more choice and also makes makes the possibility for it
5:24
Speaker 1: to be more mobile, right, And that's been one of
5:26
Speaker 1: the problems for the American labor force. It's it's not
5:28
Speaker 1: as mobile as other labor forces, and you know, going
5:33
Speaker 1: across state lines and so on entails all sorts of
5:35
Speaker 1: other sort of tax rules and so on. So see
5:38
Speaker 1: how that all plays out. But no, I do want
5:40
Speaker 1: to ask you though, um banks. For example, you know,
5:43
Speaker 1: there are certain banks that are talking about increasing bonuses
5:46
Speaker 1: for some of their star staff this year. And it's
5:49
Speaker 1: not just the banks. So on the one hand, we're
5:51
Speaker 1: seeing them try to cut costs, maybe close headquarters, close
5:55
Speaker 1: some of their office buildings and so on. But they're
5:57
Speaker 1: not docking pay or reducing pay for their such star stuff,
6:03
Speaker 1: are they. No? I mean, look that that that seems
6:07
Speaker 1: to be the evidence that that our colleagues here Bloomberger
6:10
Speaker 1: are reporting um. But look what what my story is
6:15
Speaker 1: really about or is a long term shift and how
6:17
Speaker 1: companies are thinking about this and for all those star
6:19
Speaker 1: traders who maybe getting bigger bonuses. I think we're seeing
6:23
Speaker 1: some early indications that Wall Street firms are looking at
6:26
Speaker 1: what positions don't have to be in New York and
6:29
Speaker 1: what they can move to lower cost places, and and
6:32
Speaker 1: and frankly, some of some of their back office staff.
6:35
Speaker 1: Some of their staff might find that they can lead
6:37
Speaker 1: better lives if if they can live in you know,
6:39
Speaker 1: say Nashville or Dallas, than than having to live in
6:42
Speaker 1: the New York City metro area where costs are significantly higher. Right,
6:45
Speaker 1: and sometimes it takes almost as long to get into
6:47
Speaker 1: the city from the likes of Brooklyn. Just getting Noah,
6:51
Speaker 1: thank you. There is room for just a little levity
6:53
Speaker 1: here as well. Noah bue Hire, real estate reporter with
6:56
Speaker 1: Bloomberg News, has been doing a lot of research on
6:59
Speaker 1: this on the work from home boom and what it
7:01
Speaker 1: really means for the workforce of the future here in
7:03
Speaker 1: the United States, So do check out his story. It
7:06
Speaker 1: is the cover of the new issue of Bloomberg Business
7:08
Speaker 1: Week magazine, available now on newsstands and at Bloomberg dot com.
7:12
Speaker 1: And they're always great reads, great graphics, and a great
7:15
Speaker 1: pictorials associated with these cover stories, so this one is
7:19
Speaker 1: no different. I really are due to check it out.
7:22
Speaker 1: So that does it for this week for Bloomberg Markets
7:26
Speaker 1: ten to twelve show. Do stay tuned. Balance of Power
7:29
Speaker 1: is next and we'll bring you up to date on
7:31
Speaker 1: stimulus talks and what's going on in Washington. D c
7:34
Speaker 1: and as four markets. Right now, the SME five hundred
7:38
Speaker 1: is down more than half percent, so is the Dow
7:40
Speaker 1: Jones Industrial Average NAZAC is down, but not by as much,
7:44
Speaker 1: done by a quarter of a percent or so. We
7:46
Speaker 1: have the VIX at twenty three, the Dollar index just
7:49
Speaker 1: inching above ninety once again. And for those of your
7:52
Speaker 1: keeping track of Brexit, there's still a couple of days
7:55
Speaker 1: left for a potential deal Sunday night is it's if
7:58
Speaker 1: it wants to get ratified by all the twenty seven
8:00
Speaker 1: countries before the end of the year. Right now, the
8:03
Speaker 1: British pound has come off about three tenths of a
8:05
Speaker 1: percent versus the euro training at one ten. The Conference
8:11
Speaker 1: Board leading Index of Economic Indicators came in better than
8:14
Speaker 1: forecast in November at point six. Economists, we're looking forward
8:19
Speaker 1: to show a point five reading. Not only that, but
8:21
Speaker 1: the October data was revised better as well, the overall
8:25
Speaker 1: index coming in at positive point eight in October when
8:29
Speaker 1: the original reading was positive points seven. Let's bring in
8:32
Speaker 1: somebody who knows a lot about what's going on underneath
8:34
Speaker 1: the surface here, and that is Dana Peterson, chief economist
8:36
Speaker 1: for the Conference Board. Dana, what is actually leading the
8:40
Speaker 1: leading index. Sure absolutely when we look at the details here,
8:46
Speaker 1: there's been a surprisingly a lot of very positive contribution
8:51
Speaker 1: from jobless claims, which added two tenths of a percentage
8:55
Speaker 1: point to the overall six tenths increase UM. Also, I
8:59
Speaker 1: S M. New words continue to be strong, as well
9:02
Speaker 1: as contributions from building permits and stock prices. So some
9:06
Speaker 1: of these areas are not at all surprising. Uh. Certainly,
9:09
Speaker 1: we know that manufacturing uh uh new orders have been
9:14
Speaker 1: improving with improving trade globally, and also as many businesses,
9:19
Speaker 1: factories can affect social distancing. We also know that construction,
9:23
Speaker 1: residential construction has just been booming. It's on fire in
9:26
Speaker 1: the US, and so it makes absolute sense that permits
9:29
Speaker 1: have been um very positive contributors. And finally, when we
9:32
Speaker 1: look at stock prices, indeed, the text sector healthcare stocks
9:37
Speaker 1: UM also to a certain degree, financial stocks UM have
9:40
Speaker 1: been driving gained and so all those things are being
9:42
Speaker 1: reflected in the overall measure. So the leading index, you know,
9:47
Speaker 1: rebounded quite quickly and was extraordinarily positive. At one point
9:52
Speaker 1: it was you know, above two, as close to three,
9:55
Speaker 1: and now we're sort of coming back down to earth
9:58
Speaker 1: at what point will it start to concern you in
10:01
Speaker 1: terms of the reading for the leading in next I mean,
10:04
Speaker 1: we're already a little bit concerned by the fact that
10:07
Speaker 1: you know, with each even though each month shown a
10:10
Speaker 1: positive reading, it's smaller. And so that suggests that we did,
10:15
Speaker 1: uh see a deceleration and growth heading into the last
10:18
Speaker 1: quarter of this year, and that potentially the first quarter
10:22
Speaker 1: of next year we might see a soft patch. Um.
10:24
Speaker 1: Certainly we've also seen uh this behavior reflected you know,
10:28
Speaker 1: more retroactively, of course, but in the jobs data, as
10:32
Speaker 1: payroll gains have been smaller and smaller and the unemployment
10:35
Speaker 1: rate is falling at a more glacial paste. Um. So
10:39
Speaker 1: we are keeping watching this and you know, seeing whether
10:42
Speaker 1: or not there's going to be a second dip in
10:45
Speaker 1: our leading index and also our concurrent uh leading in
10:50
Speaker 1: concurrent measures of activity. Dana, what is the conference forwards
10:55
Speaker 1: current outlook for inflation next year? Yes, well, we have
11:00
Speaker 1: inflation rising a little bit, um but staying beneath you persent, uh,
11:06
Speaker 1: and really that's going to be a reflection of you know,
11:10
Speaker 1: basis effects from very weak inflation this year twenty but
11:15
Speaker 1: also a rotation of consumption. You know, a little less
11:20
Speaker 1: spending on goods, more spending on services, um, where you
11:23
Speaker 1: could see a little bit of inflation there um, But
11:26
Speaker 1: all on all pretty modest inflation outlook, so not too
11:30
Speaker 1: much concern there. There are some economist, I suppose, trying
11:34
Speaker 1: to sound an alarm on that. Dana, you also did
11:37
Speaker 1: a really phenomenal study into the impact of the pandemic
11:42
Speaker 1: on race and also the impact of the pandemic on women,
11:46
Speaker 1: and you found something very disconcerting when it comes to
11:48
Speaker 1: studying the female labor force. You're actually calling it a
11:53
Speaker 1: she session. Can you explain to us some of the
11:55
Speaker 1: key findings of that report. Sure. Absolutely. What we've seen
11:59
Speaker 1: is that, especially in the US, where we have the
12:01
Speaker 1: most complete data, very early on in the pandemic, women
12:05
Speaker 1: suffered much deeper job cuts than did men. I mean,
12:09
Speaker 1: it was horrific across the board, but it was much
12:11
Speaker 1: more cute for women. And a lot has a lot
12:13
Speaker 1: of that to do with the fact that women are
12:15
Speaker 1: working in many of those sectors that have been very
12:18
Speaker 1: negatively impacted by covid UM. But as we saw job
12:22
Speaker 1: gains pick up, um, we saw more women exiting the
12:25
Speaker 1: labor market, and we believe that's a function number a
12:28
Speaker 1: few things. Number one, the fact that you know, there's
12:31
Speaker 1: still this childcare crisis in the US that was there
12:35
Speaker 1: before the pandemic but has only gotten worse. Um. Many
12:38
Speaker 1: times women find themselves that they are tasked with caring
12:41
Speaker 1: for older adults. But also many kids are in and
12:43
Speaker 1: out of school physically, and so oftentimes the responsibility of
12:49
Speaker 1: educating children from home falls on mothers. And so we've
12:52
Speaker 1: seen a lot of women exiting the labor market. That's
12:56
Speaker 1: very apparent in the payrolls data. Um. Sorry, uh yeah,
13:00
Speaker 1: pyroll report, Friday Employment report that comes out where labor
13:05
Speaker 1: market participation among women has been falling. Yeah. And as
13:09
Speaker 1: you say, even if the job exists, in some cases,
13:12
Speaker 1: women have to leave it because they just have responsibilities
13:14
Speaker 1: that they can fulfill at home unless they're They're right, Dana,
13:18
Speaker 1: how much of this will turn out to be structural
13:20
Speaker 1: unemployment for women? Will the female libor force bounce back
13:24
Speaker 1: as quickly as as the male labor force. Well, our
13:29
Speaker 1: hope is that this will be a blip and that
13:32
Speaker 1: female labor force participation as well as male labor force
13:34
Speaker 1: participation will bounce back and return to pre coronavirus levels.
13:38
Speaker 1: But you know, certainly the longer people are out of
13:42
Speaker 1: the labor market, the more difficult it is for them
13:44
Speaker 1: to rejoin because of perceptions that you know, either their
13:47
Speaker 1: skills of actro feed or they're credit going to be behind.
13:50
Speaker 1: So it's going to be very important for employers to
13:53
Speaker 1: find ways to encourage flexibility in labor force, in labor
13:58
Speaker 1: market activity UM in terms of allowing people to work
14:01
Speaker 1: from home, potentially providing on site or near site childcare UM,
14:06
Speaker 1: and also reskilling their workers and training to make sure
14:10
Speaker 1: workers get back on track UM such that we don't
14:12
Speaker 1: have this these permanent losses in the labor market among
14:15
Speaker 1: women as well as among men. Dana, we're pretty out
14:18
Speaker 1: of time. But what's the GDP forecast from the conference board?
14:21
Speaker 1: For one, Yes, we're expecting growth at three point six
14:26
Speaker 1: percent next year. Okay, three point six percent not not
14:30
Speaker 1: negative girls at least, but we'll need a little bit
14:33
Speaker 1: more than that. De bounced back probably from where we're from. Dana,
14:36
Speaker 1: thank you so much for joining. That is Dana beats In,
14:38
Speaker 1: chief economist with the Conference for there this as the
14:42
Speaker 1: leading index comes in a little better than forecast, but
14:44
Speaker 1: as Dana said, slowing all the while. This is one
14:50
Speaker 1: of the stories that's extremely disconcerting and also filters out slowly,
14:56
Speaker 1: such that you don't really know exactly how big or
14:58
Speaker 1: important to story it is for a little bit after
15:02
Speaker 1: the original announcements. I'm talking about the hacks, the hacks
15:06
Speaker 1: that have been filtering out news wise in the middle
15:10
Speaker 1: of this week and even more yesterday. Let's bring in
15:13
Speaker 1: somebody who's up to date on what it all is
15:15
Speaker 1: and how concerned we should be. Car Tike me Rota
15:18
Speaker 1: covers security and particularly computer security, cybersecurity and the like
15:23
Speaker 1: for Bloomberg News. Cartike bring us up to date on
15:26
Speaker 1: exactly who was attacked and how many at hacks there were. Yeah,
15:31
Speaker 1: we are still figuring this out. It's been almost a
15:35
Speaker 1: week since. Um no, it's been ten days. And excuse me.
15:38
Speaker 1: The fire Eye breach was first prepared publicly, and since
15:42
Speaker 1: then it's just been a lot of questions and very
15:45
Speaker 1: few answers. What we do know is that a handful
15:48
Speaker 1: of federal agencies were targeted, including Commerce, Treasury, parts of
15:54
Speaker 1: d h um AND, as well as the Department of
15:57
Speaker 1: Energy and the Nuclear Administration. UH. These very sophisticated Russian
16:02
Speaker 1: attackers have been targeting UM critical infrastructure and entities that
16:08
Speaker 1: are of government interest. But exactly who has been targeted
16:13
Speaker 1: and the scope of the attack is still up in
16:16
Speaker 1: the air. There are, uh, you know, federal investigators, private
16:20
Speaker 1: investigators at Microsoft and other incident response companies that are
16:24
Speaker 1: you know, pulling apart pieces of this. The scope is massive.
16:28
Speaker 1: The company that was breached Older Winds. They provide I
16:34
Speaker 1: T solutions largely for the federal government, but also they're
16:38
Speaker 1: they're all over the place. They work with UM, but
16:41
Speaker 1: financial institutions, telecommunications companies, defense contractors. They're a third party
16:47
Speaker 1: that's part of the security supply chain. UM that was
16:51
Speaker 1: targeted and using a software update, UM malware was was
16:56
Speaker 1: inflicted upon up to eighteen thousand of their clients. Now
17:02
Speaker 1: that doesn't mean the eighteen thousand victims exist. These Russian
17:05
Speaker 1: attackers are very sophisticated, very meticulous and detailed in the
17:10
Speaker 1: way in which they're targeting their victims. So as of
17:13
Speaker 1: now we're hearing and there are potentially dozens, maybe up
17:18
Speaker 1: to hundreds of victims. So of those seventeen thousand, there
17:21
Speaker 1: are about UM forty two two maybe over a hundred
17:25
Speaker 1: victims so far, but UM, that number is going to
17:29
Speaker 1: go up as time passes. UM. It's it is a
17:33
Speaker 1: tedious task trying to figure out if you have been targeted.
17:36
Speaker 1: And that's what most companies, most agencies are doing right now. Amazing.
17:40
Speaker 1: And it's suspected Russian hackers. Now we don't know what
17:45
Speaker 1: they've got, how much of it they have, But assuming
17:48
Speaker 1: they have something, will they be able to interpret data,
17:50
Speaker 1: will they be able to extract useful information? Or is
17:53
Speaker 1: this just data that will be coming in, you know,
17:57
Speaker 1: in in megabytes to the Russians and they they'll find
18:00
Speaker 1: it difficult to actually do anything with this. Yeah, no,
18:04
Speaker 1: they know what they're doing. UM. We don't have evidence
18:08
Speaker 1: of acciltration yet, but it's it's obviously a cause for concern. UM.
18:14
Speaker 1: You know, when when any adversary has this level of
18:18
Speaker 1: unmitigated long term access, which goes back at least to March,
18:23
Speaker 1: if not further. UM, surely they will have gotten their
18:26
Speaker 1: hands on UM files and data that companies and governments
18:31
Speaker 1: of the United States would have preferred they not have
18:33
Speaker 1: their hands on. Now, exactly what they have and how
18:36
Speaker 1: it will be weaponized is uh still a question that
18:40
Speaker 1: we're all trying to answer. But you know, the presumption
18:43
Speaker 1: is that they knew what they were looking for, they
18:46
Speaker 1: likely got access to at least portions of it. And
18:48
Speaker 1: this is intelligence that will feed their UM operations, right. Uh.
18:53
Speaker 1: They're geopolitical status, you know, trying to assert Russia as
18:57
Speaker 1: a UM, you know, a power on par with with
19:01
Speaker 1: other UM economic superpowers, even as that country's economic prowess
19:06
Speaker 1: sort of dissipates. This is a tool and a mechanism
19:10
Speaker 1: to to show the world that they're still on the
19:13
Speaker 1: on the platform. And uh, you know, depending on what
19:16
Speaker 1: the intelligence tells them, they could use it for um
19:20
Speaker 1: uh for political purposes or otherwise cardigate in a sense,
19:24
Speaker 1: the damage has already done. What kind of authorities do
19:27
Speaker 1: to try to mitigate the damage or prevent weaponization, as
19:30
Speaker 1: you say, including President Trump. Yeah, so you know, companies
19:35
Speaker 1: that have been exposed have been directed by the Cybersecurity
19:38
Speaker 1: Infrastructure Security Agency to cut off UM any portion of
19:44
Speaker 1: their network that has UM the Solar Winds malware and
19:48
Speaker 1: and if they can uninstall it altogether. UM at this point, UM,
19:54
Speaker 1: so what happened is that when when the malware was
19:57
Speaker 1: installed in uh in devices, these uh, these victims had
20:02
Speaker 1: to figure out if they were actually then targeted UM
20:06
Speaker 1: with an attack, was that malware activated to spread through
20:10
Speaker 1: that network and infect it. And so that is what
20:12
Speaker 1: investigators are doing right now, and it's a tedious task
20:15
Speaker 1: because these attackers have cleaned up their footprints as best
20:18
Speaker 1: they can and are are. So it's a manual operation.
20:22
Speaker 1: In some cases, they're going through thousands of lines of
20:25
Speaker 1: code to see if anything's wrong. UM. The National Security
20:29
Speaker 1: Advisor Robert O'Brien cut short and overseas trip earlier this
20:32
Speaker 1: week to come back to Washington help manage the crisis.
20:35
Speaker 1: That's what the administration is doing right now is sort
20:38
Speaker 1: of an all hands on deck situation to figure out
20:40
Speaker 1: exactly the scope of the operator. Cartigue, it might be
20:42
Speaker 1: up to you to keep us all informed. So thank
20:44
Speaker 1: you for all of your work so far. Cartigue. Me
20:47
Speaker 1: Rota on the Russian linked solar winds hack do follow
20:50
Speaker 1: him all right? Well, we know that Maderna vaccine is
20:55
Speaker 1: one backing from FDA advisors that puts it on track
20:59
Speaker 1: to be the s con cleared in the US, perhaps
21:01
Speaker 1: even as soon as today. For more on this and
21:04
Speaker 1: as well the little hiccups that we've been seeing with
21:06
Speaker 1: the rollout of the vaccine small though they maybe let's
21:09
Speaker 1: bring in Laurences our Associate Professor of Emergency Mendicine, JOHNS
21:12
Speaker 1: Hopkins School of Medicine. So, doctor Saur, is there anything
21:17
Speaker 1: that you've seen in terms of the little hiccups that
21:19
Speaker 1: we that we've heard about, from discarding doses at modern
21:24
Speaker 1: after a filtration issue to the idea that you know
21:27
Speaker 1: fis are actually had more doses in its vials than
21:30
Speaker 1: previously known. Anything that gives you cause for concern. I
21:36
Speaker 1: think concern might not be the right word, but I
21:38
Speaker 1: think it just demonstrates that the these other elements of
21:42
Speaker 1: vaccine distribution are so critically important. Right. It's not just
21:46
Speaker 1: UM getting the science behind making the vaccine and testing
21:49
Speaker 1: the vaccine, evaluating the vaccines efpacy, but UM the supply chain,
21:53
Speaker 1: so ramping up dose production, making sure that the process
21:57
Speaker 1: to get it into the hands of vaccinators and before
22:00
Speaker 1: getting vaccinated works m making sure that people believe in
22:03
Speaker 1: the process and and trust the process enough to get
22:06
Speaker 1: the vaccine. All those things are showing how critically important
22:09
Speaker 1: they are, and these hiccups are um par for the course.
22:13
Speaker 1: In this very short ramp up of production. But I
22:17
Speaker 1: think it just demonstrates how careful we have to be
22:19
Speaker 1: in this process to make sure that we're using every precous,
22:22
Speaker 1: precious dose that crosses our hands. Do you have confidence
22:25
Speaker 1: in the distribution system as it is now? Yeah? I
22:30
Speaker 1: mean I think that we're seeing that the distribution system
22:32
Speaker 1: is working as well as could possibly be expected given
22:35
Speaker 1: the short turnaround. I think some of the feedback that
22:38
Speaker 1: we're hearing from FISER and the administration and the possibility
22:41
Speaker 1: that pure dirsors will go out shows that it's far
22:44
Speaker 1: from perfect, and UM, communication becomes critically important in these um,
22:50
Speaker 1: this really intricate distribution process. UM. I think seeing things
22:55
Speaker 1: like the potential for an extra dose or two in
22:58
Speaker 1: the FISER vials, hearing that some of the production delays,
23:02
Speaker 1: I think, UM, we we're seeing that actually there's a
23:06
Speaker 1: lot of eyes on on the process and that the
23:08
Speaker 1: kings are being worked out really quickly, which is great.
23:11
Speaker 1: So even though we're identifying challenges in the process, we're
23:14
Speaker 1: working through them, you know, in this like whole response
23:18
Speaker 1: that allows us to fix it and and and improve
23:21
Speaker 1: efficiency as quickly as possible. That's such a great point
23:24
Speaker 1: because everybody really has the same goal here on that
23:26
Speaker 1: the idea that there might be extra doses in the
23:29
Speaker 1: Fiser vials, is there anything that concerns you about that,
23:32
Speaker 1: because it seems to me that you know, if Fiser
23:36
Speaker 1: won't you officially say there's more than five, then are
23:41
Speaker 1: you at risk of getting just a little bit less
23:44
Speaker 1: than the dose that you need or just a little
23:46
Speaker 1: bit more than the dose that you need. It seems
23:47
Speaker 1: a little vague for me. Yeah, I understand that completely.
23:51
Speaker 1: I think you know these vials are they're doing that
23:55
Speaker 1: because they want to ensure that that there's no um
23:58
Speaker 1: undercutting of what they expected. Sans are right, So um,
24:02
Speaker 1: the idea that that there may be an extra dose
24:04
Speaker 1: or an extra dose and a half in these vials
24:07
Speaker 1: is not unreasonable given the scale that we're talking about
24:09
Speaker 1: and how quickly things are being partitioned and measured out
24:14
Speaker 1: the The I think the risk comes when you try
24:18
Speaker 1: to say like, oh, yes, you could get six, you
24:20
Speaker 1: could get potentially six and a half or seven. UM.
24:23
Speaker 1: But if you tell everyone there's five doses in this
24:25
Speaker 1: file and you should get five doses, you're not. You
24:27
Speaker 1: have less likely that people are going to get UM
24:30
Speaker 1: a smaller dose right. So, um, perhaps it will be
24:33
Speaker 1: surprised with an extra dose and you can vaccinate several
24:35
Speaker 1: hundred extra people over the course of the projection. UM,
24:38
Speaker 1: But you don't risk under underestimating or you don't risk
24:42
Speaker 1: overestimating who you can vaccinate, so you don't risk people
24:44
Speaker 1: getting left out. Is there a little bit of a
24:46
Speaker 1: danger though, if there is you know, a half doals
24:49
Speaker 1: left and somebody decides they'll combine that with a half
24:52
Speaker 1: doals from another vial, does that not sort of letting
24:55
Speaker 1: the risk of contamination and so on? Lauren, Yeah, I
24:58
Speaker 1: think we want to We don't want to see that
25:00
Speaker 1: so UM. I know many places have made the determination
25:03
Speaker 1: not to combine partial doses from multiple vials. So that
25:07
Speaker 1: might mean a little bit of wasting at the at
25:09
Speaker 1: the bottom of that bial um, but that's really a
25:11
Speaker 1: safety issue that I think it is the right decision
25:14
Speaker 1: to not combine partial doses. It gets into measurement challenges,
25:18
Speaker 1: it gets into contamination challenges, and it gets into like
25:20
Speaker 1: basic accounting challenges. So when you're thinking about who you
25:23
Speaker 1: vaccine and how you track them, UM, you want to
25:26
Speaker 1: be sure that you're not taking those those steps where
25:30
Speaker 1: error can enter because You'll also have to follow up
25:33
Speaker 1: all of these people with additional vaccinations for their booster shops,
25:36
Speaker 1: and so you want to make sure that you have
25:38
Speaker 1: the appropriate number of booster shops for the people that
25:40
Speaker 1: you've vaccinated initially as well. I mean, there's so many
25:43
Speaker 1: things that have to go right here, and having seen
25:46
Speaker 1: how the PPE distribution system worked, it doesn't inspire that
25:49
Speaker 1: much confidence. But I guess, I mean, is there any
25:53
Speaker 1: room for let's say criminality here? I mean, can can
25:57
Speaker 1: people managed to get away with the types of things
26:00
Speaker 1: that were getting away with when it came to PPE,
26:02
Speaker 1: selling selling stuff online illegally and so on. I think that, um,
26:08
Speaker 1: it's a slightly different environment. UM. I do I share
26:12
Speaker 1: the concern that there are potential for UM for bad actors.
26:17
Speaker 1: I think we always see that in emergencies because there's um,
26:20
Speaker 1: you know, when the regulations become relaxed, or when UM
26:23
Speaker 1: you know, there's a lot of misinformation and disinformation spreading.
26:27
Speaker 1: UM that's where these people and these activities flourish. I
26:30
Speaker 1: think there's a lot of eyes on this process, and
26:32
Speaker 1: there's so few places where you can actually get UM
26:36
Speaker 1: legitimate vaccine supply that it's much less likely that you
26:41
Speaker 1: will see this happen because somewhat a new company could
26:44
Speaker 1: pop up and say we're making an N and five.
26:46
Speaker 1: It's totally approved. You're good. You're not going to have
26:49
Speaker 1: a new company pop up and say we've reproduced the
26:51
Speaker 1: Visor vaccine. You're totally good. It's trying to take it
26:54
Speaker 1: so to about the number of eyes on all of
26:56
Speaker 1: this process. Lawrence, thank you so so much, as always
27:00
Speaker 1: as Lawrence Sauer, Associate Professor of Emergency Medicine at Johns
27:02
Speaker 1: Hopkins University. Thanks for listening to Bloomberg Markets podcast. You
27:07
Speaker 1: can subscribe and listen to interviews at Apple Podcasts or
27:11
Speaker 1: whatever podcast platform you prefer. I'm Bonnie Quinn. I'm on
27:14
Speaker 1: Twitter at Bonnie Quinn, and I'm Paul Sweeney. I'm on
27:17
Speaker 1: Twitter at pt Sweeney. Before the podcast, you can always
27:20
Speaker 1: catch us worldwide at Bloomberg Radio