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Lawmakers Take Shot At Apple, Google App Stores · 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 Podcasts or wherever you listen to podcasts, and
• 0:18
  Speaker 1: at Bloomberg dot com slash podcast. Well, we've been talking
• 0:22
  Speaker 1: about it for the last several years about what appears
• 0:25
  Speaker 1: to be a growing regulatory oversight, a heavier hand on
• 0:29
  Speaker 1: the part of the U S regulators and US lawmakers
• 0:32
  Speaker 1: against big tech here. Historically they've taken a very light touch,
• 0:36
  Speaker 1: but the scenes in recent years a little bit more
• 0:39
  Speaker 1: heavier Handless check in on that story, Jen Ry, senior
• 0:42
  Speaker 1: litigation annalyst for Bloomberg Intelligence, joins us here in the
• 0:44
  Speaker 1: Bloomberg Interactive Broker Studio. So, Jen, again, it seems like,
• 0:48
  Speaker 1: you know, there's definitely been a heavier hand here by
• 0:50
  Speaker 1: a lot of these regulators, and right now they're looking
• 0:53
  Speaker 1: at the apps. I'm thinking about the app store, the
• 0:55
  Speaker 1: Google App Store, the Apple App Store. Uh, that's a
• 0:58
  Speaker 1: big revenue source for those company. Is what's converse looking at?
• 1:02
  Speaker 1: You know, It's funny it we have been talking about
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  Speaker 1: this for a couple of years, Paullen. It seemed like
• 1:06
  Speaker 1: it was really all about Google and Facebook in the beginning,
• 1:08
  Speaker 1: and then suddenly, you know, there was a lot of
• 1:10
  Speaker 1: focus on Apple and Google and their app stores and
• 1:13
  Speaker 1: their their walled gardens, so to speak, for their mobile phones.
• 1:16
  Speaker 1: What this UM Open Apps Market Act is looking to
• 1:19
  Speaker 1: do is take away some of the prohibitions and restrictions
• 1:22
  Speaker 1: that Apple and Google utilizes with app developers. So, in
• 1:25
  Speaker 1: other words, you can only a user can only download
• 1:28
  Speaker 1: an app from the official app store of that mobile system.
• 1:31
  Speaker 1: You have to use the payment systems. If you buy
• 1:34
  Speaker 1: an app or you make an in app purchase, you
• 1:35
  Speaker 1: have to use the Google or Apple payment system. And
• 1:38
  Speaker 1: also there may be some use of the data of
• 1:40
  Speaker 1: rivals to support or promote or develop their own products
• 1:43
  Speaker 1: that are also within their own app stores. So what
• 1:46
  Speaker 1: Congress is trying to do is break that down and
• 1:48
  Speaker 1: force competition that would lower the rates which are the
• 1:53
  Speaker 1: Google and Apple and Apple charge app developers, and seemingly
• 1:56
  Speaker 1: that would bring the price down for users of apps.
• 1:59
  Speaker 1: Do these kind of UM regulations also govern physical stores.
• 2:05
  Speaker 1: For example, if I opened uh chain of drug stores
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  Speaker 1: across the US. Would I have to allow certain products
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  Speaker 1: sold in my drug store and have um the margins
• 2:15
  Speaker 1: that I charge regulated, and need to allow certain people
• 2:20
  Speaker 1: access to my data, etcetera. This particular regulation would not
• 2:24
  Speaker 1: because it defines covered companies, and really it's defined so
• 2:28
  Speaker 1: specifically that it really only means Apple and Google within
• 2:31
  Speaker 1: this context. But you know, what you raise is a
• 2:33
  Speaker 1: really good point because you ask why these companies, particularly
• 2:38
  Speaker 1: when we don't regulate other industries in that in this manner,
• 2:41
  Speaker 1: And we haven't really regulated other industries in this manner
• 2:44
  Speaker 1: because government hasn't wanted to intrude on business models and
• 2:47
  Speaker 1: business strategies and the way companies operate in the free market.
• 2:51
  Speaker 1: And so I think for that reason, you know, I
• 2:53
  Speaker 1: do think that there will be some pushback. Well, there's
• 2:56
  Speaker 1: a lot of momentum here right to reform antitrust laws
• 2:59
  Speaker 1: and regular gatekeeper platforms. I do think there will be
• 3:03
  Speaker 1: some pushback, and if something gets enacted, I would see
• 3:06
  Speaker 1: it as a water down version of what we're looking
• 3:08
  Speaker 1: at here. When I first read about this, it seemed
• 3:11
  Speaker 1: like a solution in search of a problem. Is there
• 3:15
  Speaker 1: widespread pushback from consumers that apps are too expensive. You know,
• 3:21
  Speaker 1: there really isn't but consumers just may not understand the framework,
• 3:25
  Speaker 1: and that that's really what some of the competitors are arguing,
• 3:29
  Speaker 1: like Spotify or Match or Epic Games that really have
• 3:32
  Speaker 1: problems with these prohibitions of these companies. They're arguing that
• 3:35
  Speaker 1: consumers just don't really know that they're paying more because
• 3:38
  Speaker 1: Apple and Google charge the developers so much more and
• 3:41
  Speaker 1: that's passed down to consumers. But it really raised such
• 3:44
  Speaker 1: a good question because it's not really something of all
• 3:47
  Speaker 1: the things that Congress could be doing and regulating and legislating,
• 3:50
  Speaker 1: it isn't really something that there's been a big consumer
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  Speaker 1: uproar over UM. There are a lot of lawsuits and
• 3:57
  Speaker 1: there are other bills in the House and incentive that
• 4:00
  Speaker 1: would seek to do the same kind of thing. In particular,
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  Speaker 1: a lot of litigation right now against both Google and Apple,
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  Speaker 1: but it is mostly brought by companies and not by people.
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  Speaker 1: There are some I should say that there is a
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  Speaker 1: class action by consumers, but I think the broader push
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  Speaker 1: here in the litigation is by developers and also by
• 4:17
  Speaker 1: by states. Yeah, those are three apps that I don't
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  Speaker 1: use UM, but I can understand also that Congress does
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  Speaker 1: want to try and just limit the powers of these
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  Speaker 1: gigantic tech companies because they're so big and have such
• 4:29
  Speaker 1: a wide reach. Right, That's right, And I think and
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  Speaker 1: if you think about what the pushes, the bipartisan push here,
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  Speaker 1: it's why I tend to think these versions of the
• 4:39
  Speaker 1: bills we're seeing today aren't the ones that will get enacted.
• 4:42
  Speaker 1: If something gets enacted, because you have Democrats, particularly the
• 4:45
  Speaker 1: progressive wing on one side, that are really about just
• 4:48
  Speaker 1: curbing dominance and curbing monopoly power. A lot of the Republicans,
• 4:53
  Speaker 1: not all, but a lot of the Republicans are more
• 4:55
  Speaker 1: concerned about what they view as censorship, that the power
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  Speaker 1: of these companies has led to censorship of conservative viewpoints,
• 5:02
  Speaker 1: and they're more interested in regulating to prevent that kind
• 5:05
  Speaker 1: of conduct. And I think, because you have bipartisan interest,
• 5:08
  Speaker 1: but coming from two different perspectives, you may see some
• 5:12
  Speaker 1: trouble when it comes to trying to get the sixty
• 5:14
  Speaker 1: votes you need in the Senate to enact any of this.
• 5:18
  Speaker 1: All right, jen great having you on, and I hope
• 5:20
  Speaker 1: we can get you back because you're very good at
• 5:22
  Speaker 1: what you do. Jennifer E. Is a senior litigation analyst
• 5:25
  Speaker 1: for US out of Bloomberg Intelligence, talking about the latest
• 5:30
  Speaker 1: attempts to reduce the power of Apple and Google and
• 5:34
  Speaker 1: really about the lawsuits they've been brought by a number
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  Speaker 1: of companies in one class action lawsuit UM by consumers
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  Speaker 1: as well to try and regulate the app stores UM
• 5:44
  Speaker 1: and the businesses in general. Well, you know, speaking for myself,
• 5:52
  Speaker 1: one of the silver linings of this pandemic is just
• 5:55
  Speaker 1: to heighten my appreciation for the biotech industry, for the
• 5:58
  Speaker 1: pharmaceutical industry. I mean, coming up with multiple vaccines in
• 6:02
  Speaker 1: record time and getting them uh distributed as they have
• 6:07
  Speaker 1: has just been extraordinary. So just amazing work being done
• 6:10
  Speaker 1: in the biotech UH industry, and a lot of those
• 6:13
  Speaker 1: investors know very well, uh kind of what's getting done.
• 6:15
  Speaker 1: Let's check in with one of those companies, Florian Brand,
• 6:18
  Speaker 1: CEO and co founder of biotech company at Thai based
• 6:22
  Speaker 1: UH in Germany. The symbol NASTAC symbols A T A I.
• 6:25
  Speaker 1: If you've got a terminal in front of you there
• 6:27
  Speaker 1: about three percent today. They recently reported some uh some results. Floria,
• 6:32
  Speaker 1: thanks so much for joining us here. Tell us about
• 6:34
  Speaker 1: your company. What is a thaie focusing on right now.
• 6:41
  Speaker 1: Sure and thanks for having us UM today. I'm sorry.
• 6:44
  Speaker 1: Um SO it ties the clinical stage U bio pharma company,
• 6:47
  Speaker 1: so basically a drop development company developing novative novel trements
• 6:52
  Speaker 1: from mentality disorders. And you mentioned covid UM and experienced
• 6:56
  Speaker 1: that during covid those numbers of people suffering from mental
• 6:59
  Speaker 1: health in cases have unfortunately really um skyrocketed. So we're
• 7:04
  Speaker 1: in this for developing novel innovative treatments UM and also
• 7:07
  Speaker 1: look at previously stigmatized compounds such as psychedelic compounds to
• 7:12
  Speaker 1: really um improve the current existing standard of care to
• 7:17
  Speaker 1: um ya make it make patients that suffer from mental
• 7:19
  Speaker 1: health disorders and globally that's roughly billion that make them,
• 7:23
  Speaker 1: make them more more more effective, develop more effective options
• 7:27
  Speaker 1: for them, UM so that they can can get better treatments.
• 7:31
  Speaker 1: So when you talk, I mean there has been for
• 7:34
  Speaker 1: decades talk about using psychedelics like psilocybin or LSD to
• 7:39
  Speaker 1: treat various issues UM from mental health issues to alcoholism.
• 7:45
  Speaker 1: What are you talking about specifically, um so, we're among
• 7:50
  Speaker 1: others are also looking at um A psilocybin um, but
• 7:54
  Speaker 1: more broadly also at d MT and other molecules that
• 7:57
  Speaker 1: are considered psychedelics also at a at an the answerer
• 8:00
  Speaker 1: of of ketamine UM. So indeed, to your point, they
• 8:03
  Speaker 1: have been well researched over the last decades, starting as
• 8:06
  Speaker 1: early as in the fifties and sixties UM where they
• 8:09
  Speaker 1: actually already showed interesting and very compelling promising UM signals
• 8:15
  Speaker 1: that they're very relevant UM drugs treating psychiatric diseases. But
• 8:20
  Speaker 1: then mainly due to political reasons that research slowed down
• 8:23
  Speaker 1: due to the declaration of mixings war and drug and
• 8:26
  Speaker 1: then most recently with very promising studies out of John
• 8:29
  Speaker 1: Hopkins in Baltimore and Imperial College in London, there's more
• 8:33
  Speaker 1: and more kind of a spotlight in the academic world
• 8:35
  Speaker 1: showing really the promise of those compounds. And then around
• 8:39
  Speaker 1: around that time seen that's also when we decided to
• 8:43
  Speaker 1: to start a time to really put more money in
• 8:45
  Speaker 1: vigorously researching those compounds UM to really demonstrate that their
• 8:49
  Speaker 1: safe andificacious for mental disorders are to treat mentality disorders. Yeah, floor,
• 8:53
  Speaker 1: and it seems to me, you know, we haven't heard
• 8:56
  Speaker 1: much about psychedelics really since arguably the sixties and maybe
• 8:59
  Speaker 1: the seventies, So what's what has been the whole psychedelicy
• 9:04
  Speaker 1: for yourself? Exactly right, I will. I was in college
• 9:08
  Speaker 1: in the nineties and I heard a lot about them that. Yeah,
• 9:10
  Speaker 1: so what has been the use case for psychedelics historically
• 9:14
  Speaker 1: and kind of how are you perhaps repurposing that? Um
• 9:20
  Speaker 1: so indeed, I mean some countries that have been actually
• 9:22
  Speaker 1: legal for medical use. UM. Again, I think that the
• 9:25
  Speaker 1: backup flash was really driven by political motives. I mean
• 9:28
  Speaker 1: there's this anti hippie movement, uh kind of Timothy Leary
• 9:32
  Speaker 1: going a little bit too to uh, a little bit overboard.
• 9:36
  Speaker 1: It's kind of advocating that's kind of there and everyone
• 9:39
  Speaker 1: should take it. We're taking a very scientific approach here
• 9:42
  Speaker 1: and demonstrating that they're given in the right set and
• 9:44
  Speaker 1: settings and in patient treatment supervised by a therapist, they
• 9:48
  Speaker 1: can be truly helping people suffering from from these diseases.
• 9:52
  Speaker 1: And I think that's important to emphasize that we really
• 9:55
  Speaker 1: rigorously researching those in with modern samners, and that's why
• 9:59
  Speaker 1: we're running various polinical trials at different stages UM to
• 10:03
  Speaker 1: basically generate the data for the FDA and also later
• 10:06
  Speaker 1: on payers to make those therapies of imbursable. Again, you're
• 10:10
  Speaker 1: we're not in this for recreational use and overhyping this,
• 10:13
  Speaker 1: no really developing your medical compounds. It's funny that we
• 10:18
  Speaker 1: vilified UM psychedelics, but UM we have no problem prescribing
• 10:22
  Speaker 1: way too much oxyconton, right, and I wonder if UM
• 10:26
  Speaker 1: you can use these, especially to treat addiction. I think
• 10:29
  Speaker 1: that was one of the bright spots that I remember
• 10:31
  Speaker 1: reading a lot about absolutely so UM the opio crisis,
• 10:37
  Speaker 1: especially especially relevant for for the US, and we see
• 10:40
  Speaker 1: from from year to year also that the death toll
• 10:43
  Speaker 1: of use this order rising. Unfortunately, We're developing one very
• 10:48
  Speaker 1: interesting compound called Eyebel Game that has historically be you
• 10:52
  Speaker 1: has been used to kind of ritualistic settings from kind
• 10:55
  Speaker 1: of indigenous people, but also have been administed in clinical
• 10:59
  Speaker 1: settings um UH for for patients in Latin America, and
• 11:03
  Speaker 1: has shown then based on case studies, showing great potential.
• 11:07
  Speaker 1: So there's a lot of anecdotal evidence and that this
• 11:10
  Speaker 1: can be really an interesting therapy for people really suffering
• 11:15
  Speaker 1: from addiction. All Right, Florian Brand, thank you so much
• 11:18
  Speaker 1: for joining us. Really appreciate you taking the time of
• 11:20
  Speaker 1: Florian Brand. He's the CEO and co founder of biopharmaceutical
• 11:25
  Speaker 1: company a Taie symbol a t AI based in Germany.
• 11:29
  Speaker 1: They're focusing on the psychedelic side of the market and
• 11:33
  Speaker 1: stocks up about three percent today. Uh they went public
• 11:36
  Speaker 1: at fifteen is trading just a little bit above fourteen
• 11:38
  Speaker 1: dollars to share of three percent. They reported some uh
• 11:41
  Speaker 1: our financial results just recently, so too good to get
• 11:44
  Speaker 1: his thoughts on that market. Looking at the ten year
• 11:49
  Speaker 1: treasury one point to three eight percent, where does a
• 11:53
  Speaker 1: good fixed income investor go to get return? Let's go
• 11:57
  Speaker 1: to r J. Gall and asked that question. He's a
• 11:59
  Speaker 1: senior portfolio manager head of the Admiserable bond group it
• 12:01
  Speaker 1: federated Hermes based in Pittsburgh. They had a couple of
• 12:05
  Speaker 1: shekels under management. Let's call it total assets on management
• 12:09
  Speaker 1: six billion. R J, thanks so much for joining us here. Um,
• 12:14
  Speaker 1: you know, tax exempt or taxable? Where do I go
• 12:18
  Speaker 1: for yield today? How much ris should I be taking? Well?
• 12:22
  Speaker 1: The yield can be hard to come by, certainly in
• 12:25
  Speaker 1: a historic sense, yields are are basically a record lows
• 12:29
  Speaker 1: and muni spreads of titan massively both taxable and taxing.
• 12:33
  Speaker 1: That markets thematically have seen low quality credit massively outperformed UH,
• 12:39
  Speaker 1: and that UM is something that that I think a
• 12:42
  Speaker 1: number of active managers certainly we felt was apt to
• 12:46
  Speaker 1: happen as the UM at least the improvement in the
• 12:50
  Speaker 1: pandemic picture, which recently has been complicated by the delta variant,
• 12:53
  Speaker 1: but nevertheless, the economic reopening a strong tail wind to
• 12:58
  Speaker 1: the returns to credit, whether it be intact sex after
• 13:00
  Speaker 1: taxable bond markets. Looking forward, given the yield moves, given
• 13:04
  Speaker 1: the spreads have compressed, UH, there seems to be a
• 13:07
  Speaker 1: little pause in that. Over the last month or so,
• 13:09
  Speaker 1: high yield corporates, for example, have started printing somewhat weaker returns.
• 13:14
  Speaker 1: In the muni space, spread teams have stagnated. You still
• 13:17
  Speaker 1: get your incremental carry your income UM, which is better,
• 13:20
  Speaker 1: but you're you're losing out UM. You're not getting the
• 13:23
  Speaker 1: price and appreciation that we have before. It's certainly gotten
• 13:26
  Speaker 1: a little murkier going forward, and the delta variant is
• 13:28
  Speaker 1: probably the main reason at this point in time. Are
• 13:31
  Speaker 1: you getting paid for the risk? Howard marks Um told
• 13:35
  Speaker 1: Eric Shatzker a couple of weeks ago, he thought, you know,
• 13:37
  Speaker 1: three basis points sounds very little, but he wasn't as
• 13:41
  Speaker 1: concerned about default risks and felt he was being paid
• 13:45
  Speaker 1: um in line with the risk he was taking. Are
• 13:50
  Speaker 1: high yield group is a very strong group in the company,
• 13:54
  Speaker 1: with a lot of success in various strategies, and our
• 13:57
  Speaker 1: our multisector total on fund we started of a sleeve approach.
• 14:00
  Speaker 1: So when we allocate myndy to high yield, our high
• 14:03
  Speaker 1: yield guys management and they tell me, UM, they still
• 14:06
  Speaker 1: like the market. We still are overweight relative to our benchmarks. Uh.
• 14:10
  Speaker 1: The prospect of return is obviously lower than what we've
• 14:13
  Speaker 1: experienced in the last you know, six to twelve months,
• 14:16
  Speaker 1: for sure, but the incidents of default is expected to
• 14:19
  Speaker 1: be very very low. Corporate profits just printed a lot
• 14:23
  Speaker 1: of favorable news across a variety of sectors. Now everybody
• 14:27
  Speaker 1: says that's backward looking. Yeah it is, but it's the
• 14:29
  Speaker 1: most recent momentum that we have built up economically heading
• 14:33
  Speaker 1: into what could be a dicey late summer and fall.
• 14:36
  Speaker 1: As the delta variant clearly a roding on sentiment. Look
• 14:39
  Speaker 1: at the Michigan consumer sentiment numbers. UM. I think corporations
• 14:43
  Speaker 1: are now struggling with return to office in addition to
• 14:46
  Speaker 1: supply chain challenges and various echoes of the of the
• 14:49
  Speaker 1: first wave of the pandemic that we're all still going through. UM,
• 14:52
  Speaker 1: we're still optimistic that credit is an avenue towards our performance.
• 14:56
  Speaker 1: Uh not the least of which contributing factor the that
• 15:00
  Speaker 1: is still at zero, still buying bonds, suppressing returns on
• 15:04
  Speaker 1: high quality fixed income, and that is helping to boost
• 15:07
  Speaker 1: returns to low quality. We don't think of recessions in
• 15:09
  Speaker 1: the offing. We might have a hiccup, it might be
• 15:11
  Speaker 1: a little bit of headwind compared to what we expected
• 15:13
  Speaker 1: because the delta variant, but we still like credit on
• 15:15
  Speaker 1: economic momentum and corporate corporate performance. I didn't I didn't
• 15:19
  Speaker 1: mean to get us off the Muni track. Paul is
• 15:22
  Speaker 1: obsessed with Muni's absolutely. I I love the new Jersey Meunis.
• 15:26
  Speaker 1: We just can't get me yields r J. How about
• 15:29
  Speaker 1: inflation here, r J? I mean that is a concern.
• 15:32
  Speaker 1: It isn't even more more of a concern for this market,
• 15:34
  Speaker 1: say a month ago, and perhaps people getting more and
• 15:36
  Speaker 1: more into that transitory camp. How do you guys think
• 15:39
  Speaker 1: about that? UM, We've been firmly in the camp that
• 15:42
  Speaker 1: it will be less, it won't be as transitory as
• 15:45
  Speaker 1: Chairman Powell expects UM. I think even those at the FED,
• 15:50
  Speaker 1: I mean, you can sense over the last eight weeks
• 15:53
  Speaker 1: there was a softening of the transitory UM desk beating
• 15:58
  Speaker 1: for a while there it was going to be transitory,
• 16:00
  Speaker 1: and it was almost like they wanted to guarantee it. UM.
• 16:02
  Speaker 1: But if you look at the f OMC speeches, if
• 16:05
  Speaker 1: you look at the minutes or not the minute, excuse me,
• 16:08
  Speaker 1: the summary of eaconomic projections and the risk around their
• 16:11
  Speaker 1: inflation outlook was skewed to the upside. I think that
• 16:15
  Speaker 1: it's pretty clear that the inflation story is still evolving
• 16:19
  Speaker 1: in such a way that we think that the Fed
• 16:21
  Speaker 1: will prove to have overplayed the transitory card UH, and
• 16:25
  Speaker 1: that some of this inflation is gonna last and echo
• 16:28
  Speaker 1: for a while. UH. It's one of the reasons why
• 16:30
  Speaker 1: we are still short duration UM a little less so
• 16:33
  Speaker 1: than we were, say, six day weeks ago, but we
• 16:37
  Speaker 1: still believe that you'll should be heating someone higher to
• 16:38
  Speaker 1: compensate for the inflation risk that is clearly higher today
• 16:43
  Speaker 1: than then it was expected to be. I think on
• 16:45
  Speaker 1: the part of the FED and on the part of
• 16:47
  Speaker 1: many of the markets. Right now, the market doesn't seem
• 16:49
  Speaker 1: to care that much about that. Uh, you know, you've
• 16:52
  Speaker 1: had some deceleration in the month over month, Prince that
• 16:54
  Speaker 1: that's good. The second derivative went negative. That fits the
• 16:57
  Speaker 1: FEDS framework of transit story. But we don't believe we're
• 17:01
  Speaker 1: gonna get reset back towards the fedced target rate of
• 17:05
  Speaker 1: two percent. We're going to probably overshoot it more than
• 17:07
  Speaker 1: they would like. And we think as a bond investor,
• 17:10
  Speaker 1: you know, owning treasuries for example, we we should ask
• 17:12
  Speaker 1: for a little bit more, ye know, than we think
• 17:13
  Speaker 1: rates should be heading higher. The delta variant and its
• 17:16
  Speaker 1: impact on the gross trajectory the obvious key risk. I
• 17:19
  Speaker 1: do think the Afghanistan story is a very difficult story
• 17:22
  Speaker 1: on many fronts, but I don't think it's an economic
• 17:24
  Speaker 1: or a market problem. When is you know, considering the
• 17:31
  Speaker 1: phenomenal history of the Michigan Wolverines that their performance over
• 17:36
  Speaker 1: the past few years, over the deck last decade really
• 17:39
  Speaker 1: has been dismal, When are they going to field a
• 17:42
  Speaker 1: really winning team? R J. I just you know, I
• 17:45
  Speaker 1: have to warn you. Matthew is from the state of Ohio. Uh, yeah,
• 17:51
  Speaker 1: that you came from. Are you a Hire State fan?
• 17:53
  Speaker 1: Is that what you're trying to tell me, sir? Yeah, Well,
• 17:55
  Speaker 1: I mean I like winning teams. You know. Well, you
• 17:59
  Speaker 1: know I I used to bristle at these kinds of comments.
• 18:02
  Speaker 1: I have to say that the it's been a little
• 18:05
  Speaker 1: humbling the Michigan football performance of late um, I would
• 18:09
  Speaker 1: say this, I think that you basically when Harbaugh came in,
• 18:13
  Speaker 1: there were expectations he was going to get us into
• 18:15
  Speaker 1: the college football Championship, get into the playoff, or whatever
• 18:19
  Speaker 1: iteration of it that we're on. I'm gonna have to
• 18:22
  Speaker 1: cut you off. Well, here in the Bloomberg Radio studio
• 18:28
  Speaker 1: here Bloomberg h Q in Europe, it got lots of
• 18:30
  Speaker 1: the cable network video streams up and running at all
• 18:33
  Speaker 1: times just to keep on top of the news and
• 18:36
  Speaker 1: lots of images and video of chaotic chaos going on
• 18:40
  Speaker 1: in Afghanistan, particularly at the airport in Cobble. Right now,
• 18:43
  Speaker 1: let's get the latest from Bill Ferries, he's a national
• 18:45
  Speaker 1: security team leader for Bloomberg News, joining us on the
• 18:48
  Speaker 1: phone from Washington, d C. Bill, Again, this is not
• 18:51
  Speaker 1: the way I don't think anybody wanted it to go.
• 18:55
  Speaker 1: But perhaps this is should not be that surprising. What
• 18:58
  Speaker 1: is the latest from your warding about what is going
• 19:01
  Speaker 1: on in Afghanistan, particularly in Cobble Well, as you mentioned,
• 19:06
  Speaker 1: there have been some scenes of real chaos and confusion
• 19:09
  Speaker 1: at the airport. Is people storm the runway, some trying
• 19:12
  Speaker 1: to grab onto US military planes as they were taxing. Um.
• 19:18
  Speaker 1: I mean up is now reporting that there have been
• 19:21
  Speaker 1: seven people killed at the airport so far. I think
• 19:25
  Speaker 1: on the U s side, people were waiting to see
• 19:28
  Speaker 1: how the President Biden uh finds a way to address
• 19:31
  Speaker 1: the situation. The administration is pushed back a lot um
• 19:35
  Speaker 1: in terms of saying that you know, they expected the
• 19:37
  Speaker 1: Afghan military to put up much more of a fight
• 19:40
  Speaker 1: against the Taliban, and even as a lot of analysts
• 19:43
  Speaker 1: thought that the Taliban might eventually take control, I don't
• 19:46
  Speaker 1: think there was anyone even a week ago predicting that
• 19:50
  Speaker 1: something would happen this quickly. That said, the US has
• 19:54
  Speaker 1: spent twenty years building up the Afghan military, So if
• 19:57
  Speaker 1: anyone should have known how prepared they were to fight
• 20:00
  Speaker 1: or not, you would think it would have been the
• 20:02
  Speaker 1: US commanders in the field. Yeah, I mean, I would
• 20:04
  Speaker 1: say from reading through the Afghan paper, Afghanistan papers and
• 20:09
  Speaker 1: reporting across the various news organizations. UM, it looks like
• 20:13
  Speaker 1: the Taliban started to negotiate with Afghan army and police
• 20:17
  Speaker 1: personnel at the beginning of the year or the end
• 20:21
  Speaker 1: of last year. So the Taliban already knew that they
• 20:25
  Speaker 1: had these entry points. And UM, a lot of these
• 20:30
  Speaker 1: Afghan officials weren't getting paid for the last six months
• 20:32
  Speaker 1: of the last nine months, so clearly, UM, you could
• 20:35
  Speaker 1: see how their loyalty would weaken. What happens now, UM
• 20:40
  Speaker 1: in terms of getting people out, I know the president's
• 20:44
  Speaker 1: UM team said they're gonna send what five thousand troops
• 20:47
  Speaker 1: to the US to to the Kabul airport. Um, is
• 20:51
  Speaker 1: that still the case? And how are they planning on
• 20:53
  Speaker 1: who are they planning on taking out? Well, right, it's
• 20:57
  Speaker 1: actually up to six thousand now that they said, we'll
• 20:59
  Speaker 1: be in play by by at some point tomorrow on Tuesday. UH.
• 21:03
  Speaker 1: And their job is to secure some sort of a
• 21:06
  Speaker 1: perimeter around the airport. And they still have diplomats, they
• 21:10
  Speaker 1: still have Afghan translators and other aids that they are
• 21:14
  Speaker 1: rushing out. It's not just in the US, the UK
• 21:16
  Speaker 1: is also running flights in and out of Kabbal the
• 21:20
  Speaker 1: big the big question, and I think the problem that
• 21:22
  Speaker 1: the US has here is that if you know you're
• 21:25
  Speaker 1: someone who's trying to get out, whether you might be
• 21:28
  Speaker 1: an Afghan translator who worked with NATO forces for years
• 21:32
  Speaker 1: but in a more remote province, you would have to
• 21:34
  Speaker 1: get yourself to Kabbo. At this point, there are no
• 21:37
  Speaker 1: exit points um in Afghanistan except the airport. If you
• 21:42
  Speaker 1: try to cross the land border, you're going through Taliban
• 21:44
  Speaker 1: setpoint for that at that stage. So I think that's
• 21:48
  Speaker 1: going to be the question is how well can the
• 21:50
  Speaker 1: US and allies get their own people and their aids out,
• 21:54
  Speaker 1: and then of course what happens to for instance, women
• 21:57
  Speaker 1: and uh and and children's rights and country We we
• 22:01
  Speaker 1: all remember what that was like under the Taliban, and
• 22:04
  Speaker 1: there's already reports of human rights abuses in some of
• 22:08
  Speaker 1: these Taliban controlled areas. UN Security Councils having an emergency
• 22:12
  Speaker 1: session on that issue right now, um and that's going
• 22:15
  Speaker 1: to be one of the bigger questions in the days ahead.
• 22:18
  Speaker 1: It's so damaging to the US credibility right to have
• 22:21
  Speaker 1: um U S forces so publicly abandoned, these people who
• 22:26
  Speaker 1: put their trust in the United States military, and I
• 22:30
  Speaker 1: just really leave them hanging. How how does a president
• 22:34
  Speaker 1: who wanted to telegraph the message America's back to work
• 22:38
  Speaker 1: with the world, how does he handle that? Without a doubt,
• 22:42
  Speaker 1: It's it's perhaps the biggest crisis that Joe Biden the
• 22:45
  Speaker 1: space that he took office. He ran as a candidate
• 22:49
  Speaker 1: in part on his you know, three decades of experience
• 22:52
  Speaker 1: on the on the Senate Foreign Relations Committee, his time
• 22:54
  Speaker 1: as a vice president UM, and you know, really as
• 22:57
  Speaker 1: a foreign policy expert. And again, I think there were
• 23:01
  Speaker 1: a lot of people who would have said, yes, the
• 23:03
  Speaker 1: Taliban will eventually win this, but nobody thought it would
• 23:06
  Speaker 1: happen this uh, this quickly, and it makes the administration
• 23:10
  Speaker 1: look like it didn't really have a plan for how
• 23:12
  Speaker 1: to secure the withdrawal, to get its allies out in time.
• 23:18
  Speaker 1: We have six thousand troops going into the airport by tomorrow.
• 23:21
  Speaker 1: That's more troops than we've had for four or five
• 23:23
  Speaker 1: years UH in Afghanistan. So, you know, a few weeks
• 23:28
  Speaker 1: last months of the president, Biden was saying there was
• 23:30
  Speaker 1: no way we would see this kind of a situation.
• 23:33
  Speaker 1: We have it faster than anyone expected Bill. I guess
• 23:36
  Speaker 1: what's going through my Twitter feed at the moment as
• 23:38
  Speaker 1: it released to Afghanistan is the lack of communication from
• 23:42
  Speaker 1: the White House, particularly from the President. What do we
• 23:44
  Speaker 1: know about when he will address this issue publicly? We
• 23:49
  Speaker 1: are his national security advice in this morning that you
• 23:52
  Speaker 1: will address it soon. We know he's been up at
• 23:54
  Speaker 1: Camp David. I think we're all looking to see whether
• 23:58
  Speaker 1: uh he tries to give a speech to the nation
• 24:00
  Speaker 1: from there, whether he comes back to Washington. We have
• 24:03
  Speaker 1: not seen a lot of his top advisors. It was
• 24:06
  Speaker 1: his national security advisor who was on TV this morning,
• 24:10
  Speaker 1: But we haven't, you know, except for the Sunday shows,
• 24:12
  Speaker 1: we haven't seen a lot of Tony Lincoln, Secretary of State,
• 24:15
  Speaker 1: or Lloyd Austin, Secretary of Defense. They've got a lot
• 24:18
  Speaker 1: to work on, of course, but I think you would
• 24:21
  Speaker 1: expect to see them putting their face forward a lot
• 24:23
  Speaker 1: more in the coming hours. And Tony B. Lincoln um
• 24:26
  Speaker 1: said he considers the administration considered the mission in Afghanistan
• 24:31
  Speaker 1: success going after those who harbored nine eleven terrorists. What
• 24:35
  Speaker 1: are the chances that the Taliban harbor's terrorists again, or
• 24:40
  Speaker 1: that the vacuum is filled with you know, um, Chinese
• 24:44
  Speaker 1: or Iranian power. I think for sure you're going to
• 24:48
  Speaker 1: see foreign powers thinking a stronger interest. I mean when
• 24:51
  Speaker 1: you look at hoop orders Afghanistan, just starting with China
• 24:54
  Speaker 1: and Russia, they first of all, they have their own
• 24:57
  Speaker 1: security concerns. Um, there were four that China had fast
• 25:01
  Speaker 1: up its military presence a little bit on its shared border. Uh.
• 25:05
  Speaker 1: And for sure, Pakistan, of course, which is a close
• 25:08
  Speaker 1: ally of China, is going to be even more involved
• 25:11
  Speaker 1: than it than it already has been. The Taliban, their
• 25:15
  Speaker 1: comments so far have been a little bit more moderate. Um.
• 25:18
  Speaker 1: They've been saying that they want to have some sort
• 25:20
  Speaker 1: of a discussion about the political future of the country.
• 25:24
  Speaker 1: But I think realistically people are not going to put
• 25:27
  Speaker 1: a lot of stock on that. Actions will speak much
• 25:30
  Speaker 1: louder than words. And and and the Taliban have a
• 25:32
  Speaker 1: history of of of running you know what was internationally
• 25:36
  Speaker 1: condemned as a as A as a fairly brutal regime
• 25:41
  Speaker 1: when it will help power in the late ninety nineties,
• 25:44
  Speaker 1: all right, It's just a horrible situation. And I'm sure
• 25:49
  Speaker 1: there will be plenty time for blame to go around
• 25:51
  Speaker 1: after but it would be uh, you hope that American, British, German,
• 25:56
  Speaker 1: French forces can get in there and save the people
• 25:59
  Speaker 1: that their trust into the Allied forces. Bill, thanks so
• 26:03
  Speaker 1: much for joining us. Bill Ferries is National Security Team
• 26:07
  Speaker 1: leader for US here at Bloomberg News, joining us out
• 26:10
  Speaker 1: of Washington, d C. Talking about the UM still developing,
• 26:13
  Speaker 1: but just tragic, tragic situation. The images of people jumping
• 26:18
  Speaker 1: onto air force planes and trying to run on the
• 26:21
  Speaker 1: outside of the aircraft are really horrifying. Thanks for listening
• 26:25
  Speaker 1: to the Bloomberg Markets podcast. You can subscribe and listen
• 26:29
  Speaker 1: to interviews of Apple Podcasts or whatever podcast platform you prefer.
• 26:33
  Speaker 1: I'm Matt Miller. I'm on Twitter at Matt Miller three.
• 26:38
  Speaker 1: On Ball Sweeney, I'm on Twitter at pt Sweeney. Before
• 26:41
  Speaker 1: the podcast. You can always catch us worldwide at Bloomberg Radio.