Latest / Bloomberg Intelligence / CVS Is Top Healthcare Pick, Good Price Now: Pointview’s Dietze

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CVS Is Top Healthcare Pick, Good Price Now: Pointview’s Dietze · Bloomberg Intelligence

• 0:05
  Speaker 1: Welcome to the Bloomberg p m L Podcast. I'm pim Fox.
• 0:08
  Speaker 1: Along with my co host Lisa A. Bramowitz. Each day
• 0:11
  Speaker 1: we bring you the most important, noteworthy, and useful interviews
• 0:15
  Speaker 1: for you and your money, whether you're at the grocery
• 0:17
  Speaker 1: store or the trading floor. Find the Bloomberg p m
• 0:20
  Speaker 1: L Podcast on Apple Podcasts, SoundCloud, and Bloomberg dot com. Alphabet,
• 0:34
  Speaker 1: the parent company of Google, reports results after the close
• 0:37
  Speaker 1: of trading today. To find out whether the stock is
• 0:40
  Speaker 1: worth buying and whether the company is worth owning, we
• 0:43
  Speaker 1: go to David Dietz as the founder, president and chief
• 0:46
  Speaker 1: Investment Strategies for Point of View Wealth Management, helping to
• 0:49
  Speaker 1: manage more than three d and forty million dollars. They're
• 0:52
  Speaker 1: based in Summit in New Jersey. David diets always a
• 0:54
  Speaker 1: pleasure give us your thoughts on well technology in general,
• 0:58
  Speaker 1: but more specifically on ALP about the parent company of Google.
• 1:02
  Speaker 1: You know, so Alphabet uh has one of the best
• 1:05
  Speaker 1: franchises on the planet. Um, they're gonna come out with
• 1:09
  Speaker 1: blowout results, I think. Um, you know, the question really
• 1:14
  Speaker 1: is too fold for investors at this point. You're based
• 1:18
  Speaker 1: on various metrics. It is one of the most highly
• 1:21
  Speaker 1: valued stocks out there, one of of course, the Fang codre.
• 1:26
  Speaker 1: So the question is how much future earnings has already discounted.
• 1:30
  Speaker 1: And then of course you've got the political developments here. Um.
• 1:34
  Speaker 1: Obviously social media stocks are under fire. There was a
• 1:38
  Speaker 1: disastrous breach of privacy of Facebook. I think there's gonna
• 1:42
  Speaker 1: be some new regulations, new measures taken. There's only one
• 1:45
  Speaker 1: company and the planet has more data on us than
• 1:48
  Speaker 1: Facebook is probably Google. Um, So that's another thing investors
• 1:52
  Speaker 1: have to watch. And of course there is questions that's
• 1:55
  Speaker 1: to monopoly power that was asked heavily to Facebook. Well,
• 1:58
  Speaker 1: you know, if you don't use Google about to do
• 2:00
  Speaker 1: a search, who do you use? I think that's the
• 2:02
  Speaker 1: real question that ultimately investors have to weigh into um
• 2:06
  Speaker 1: their calculations in terms of whether to invest in Google today. So, David,
• 2:10
  Speaker 1: just from your perspective, when you decide whether buy whether
• 2:14
  Speaker 1: to buy a stock, Apple is now down for the year,
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  Speaker 1: uh down more than a percent? Is now a time
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  Speaker 1: that you would be interested in buying? You know, it's
• 2:25
  Speaker 1: a better time. And if you were not big Fang
• 2:29
  Speaker 1: investors here as it were, that certainly is the cheapest
• 2:32
  Speaker 1: one but there's there's clearly a reason. One is UH.
• 2:36
  Speaker 1: The other companies are really services media content. Apple is
• 2:41
  Speaker 1: much more of a product UM and so you know,
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  Speaker 1: the question is UH, when how many you know, UH
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  Speaker 1: iPhone tents are people going to buy? It's over one
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  Speaker 1: thou dollars. There's a lot of offerings to lessen that.
• 2:55
  Speaker 1: And when they're all done buying whatever they do buy,
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  Speaker 1: will we trade up to the iPhone or love and UM?
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  Speaker 1: If you go back five fifteen years, we remember the
• 3:04
  Speaker 1: motor Rola devices, remember the Nokia devices. We counted our
• 3:08
  Speaker 1: BlackBerry devices. Now it's all about iPhone. What will we
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  Speaker 1: be using five to ten years from now? And we
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  Speaker 1: will be smart enough to make the transition at the
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  Speaker 1: right time. Those are some of the questions that Apple
• 3:18
  Speaker 1: insensors have to ask. David Deeds. What percentage of a
• 3:22
  Speaker 1: of a portfolio? If a certain percentages in stocks, how
• 3:26
  Speaker 1: much of that should be invested in stocks such as Facebook, Alphabet, Apple,
• 3:32
  Speaker 1: Netflix and UH and Google. We think investors should be diversified,
• 3:37
  Speaker 1: and that includes of course UM all the great technology names.
• 3:43
  Speaker 1: But we're not focusing on the Fang portion. We're looking
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  Speaker 1: for UM more old tech that now is offering great
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  Speaker 1: dividends UM and is growing those dividends UM. Names that
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  Speaker 1: we like here in terms of technology would include in Hell,
• 4:00
  Speaker 1: would include Cisco, would include Oracle, Uh, Microsoft, we've been
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  Speaker 1: big buyers of, although that too now is getting a
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  Speaker 1: little pricey um. Heuliette Packard has done well for us,
• 4:10
  Speaker 1: and we wonder now with to sell off an IBM,
• 4:12
  Speaker 1: whether a Meg Whitman type might ultimately take the reins
• 4:16
  Speaker 1: there and do for IBM what Meg Whitman did for
• 4:19
  Speaker 1: Heulitt Packard. That also could be very rewarding to shareholders.
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  Speaker 1: When was the last time that you changed a pretty
• 4:26
  Speaker 1: substantial investing thesis for your portfolio? You know, we're pretty
• 4:32
  Speaker 1: much stay the course. We certainly at this point now
• 4:37
  Speaker 1: are looking quite heavily at income oriented stocks. Why is
• 4:42
  Speaker 1: that because these stocks have sold off dramatically. It started
• 4:45
  Speaker 1: last summer and accelerated this year out of fear of
• 4:49
  Speaker 1: rising interest rates. But we think at this point there's
• 4:52
  Speaker 1: a number of great franchises and income oriented stocks, utilities
• 4:57
  Speaker 1: read telecoms, which now are discounting the ten year perhaps
• 5:01
  Speaker 1: going to four percent. It could, but you know, you're
• 5:04
  Speaker 1: at the at the high point of the year in
• 5:06
  Speaker 1: terms of yields. There are some concerns as the strength
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  Speaker 1: of the economy will find out more on Friday in
• 5:11
  Speaker 1: terms of GDP growth. For to one, Hold on a second,
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  Speaker 1: I'm sorry to break in there. You said we're at
• 5:16
  Speaker 1: the high point in terms of eels. You mean, do
• 5:18
  Speaker 1: you think that eels are going to come down from here?
• 5:21
  Speaker 1: They started at to four the ten year, right now
• 5:24
  Speaker 1: there are at three. Um. Will there be some retracement back?
• 5:29
  Speaker 1: Obviously for everyone who's selling the ten year treasury today,
• 5:33
  Speaker 1: someone else is buying UM. It really depends on inflation.
• 5:37
  Speaker 1: It depends on the strength of the economy. The economy
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  Speaker 1: looks good, but we're gonna see a third quarter in
• 5:44
  Speaker 1: a row of decelerating g d P. Retail sales have
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  Speaker 1: not been where a lot of people would like them
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  Speaker 1: to be. So UM, you know, we think that maybe
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  Speaker 1: this is the time, not necessarily for the ten year bond,
• 5:58
  Speaker 1: but to buy stocks. They're discounting much much higher interest rates,
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  Speaker 1: which will include UM reachs. Uh. The one that we
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  Speaker 1: like particularly now is venta symbol VTR, which is your
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  Speaker 1: largest healthcare rea in the country. That's kind of a
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  Speaker 1: defensive sector. The yield is now over six percent, is
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  Speaker 1: down about from fifty two week high. David Diets, I'm
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  Speaker 1: glad you mentioned healthcare. What about CVS health. You know,
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  Speaker 1: that's one of our top picks in the area. That's
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  Speaker 1: the other growth theory besides technology UM. CVS is one
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  Speaker 1: of the largest drug retailers. They're also one of the
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  Speaker 1: largest PPM pharmacy benefit managers. Uh. The stock is trading
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  Speaker 1: it just over ten times earnings, three percent dividend. They're
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  Speaker 1: only paying less than a third of their earning. Does
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  Speaker 1: the dividends of this room to grow that? What's the
• 6:47
  Speaker 1: knock on the stock? There's been a couple knocks. One
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  Speaker 1: is the Amazon was going to dive into the business.
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  Speaker 1: They seem to have indicated they want to pull back
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  Speaker 1: on that. The other knock is there maybe uh they're
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  Speaker 1: buying a no which will vertically integrate them. That's a
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  Speaker 1: great move, except they're paying an awful lot. But there's
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  Speaker 1: a good chance that merger does not go through in
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  Speaker 1: any event, we think at the current valuation in kind
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  Speaker 1: of a growth area, which is, you know, more and
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  Speaker 1: more prescription drugs than the whole healthcare sector of CBS,
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  Speaker 1: is a good pick right now. David, I just wanted
• 7:17
  Speaker 1: your thoughts real quick on shale companies because we have
• 7:20
  Speaker 1: seen the price of oil rise substantially in Saudi Arabia,
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  Speaker 1: kind of giving it some uh something of a tail wind.
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  Speaker 1: So I'm wondering are you seeing opportunity there. We think
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  Speaker 1: energy is a good sector to keep accumulating in. It
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  Speaker 1: is probably the worst performing sector over the last decade.
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  Speaker 1: We saw a fossil fuel price as well, over a hundred.
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  Speaker 1: They got down back down to twenty two years ago,
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  Speaker 1: and now they're backup knocking on the door of seventy.
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  Speaker 1: If inflation does rear its head, if the global economy
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  Speaker 1: continues to grow, we think there'll be upward biased in
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  Speaker 1: fossil fuel prices, and certainly um shale plays will benefit it.
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  Speaker 1: David Diets, thank you so much for being with us.
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  Speaker 1: David Diets, Founder president and chief investment strategist at point
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  Speaker 1: View Wealth Management in Summit, New Jersey. Definitely be interesting
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  Speaker 1: to get those Facebook, Google, Amazon dot Com earnings. Well.
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  Speaker 1: We learned today that Sears Holdings chief executive Eddie Lampert
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  Speaker 1: is offering to actually purchase the ken More appliance brand
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  Speaker 1: as well as other Sears units after the company was
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  Speaker 1: unable to actually find other buyers for the assets. Here
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  Speaker 1: to help us understand what's going on is Bert Flickinger.
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  Speaker 1: He is the managing director of Strategic Resource Group. He
• 8:51
  Speaker 1: can be followed on Twitter at Bert underscore Flickinger. Okay,
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  Speaker 1: Bert underscore Flickinger. Can you explain what exact he is
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  Speaker 1: going on? Why is Eddie Lamport, who actually threw e
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  Speaker 1: S l owns basically runs Sears. Why would he be
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  Speaker 1: buying these these brands and these units from Sears if
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  Speaker 1: he already owns them, Pim and Liza A couple of reasons. One,
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  Speaker 1: he's getting the business by one get one free controls,
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  Speaker 1: the master leases and the real estate he's buying plus
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  Speaker 1: pluses you referenced, he's getting the Kenmore brand. Plus he's
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  Speaker 1: getting the home improvement brand, the ship business, the parts
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  Speaker 1: parts business, and the home repair business. And Lowe's just
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  Speaker 1: had a CEO change because they couldn't do all that
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  Speaker 1: serious as a loyal customer base. And he's doing it
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  Speaker 1: at the perfect time when Bonton is Bloomberg reported last
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  Speaker 1: week filing for liquidation. So from Bonton to Carson's to
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  Speaker 1: the Herburger stores, Lisa knows well, she knows the whole
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  Speaker 1: Bonton group across America. They'll pick up business there from
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  Speaker 1: our store checks. Lands end looks good and Sears could
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  Speaker 1: actually survive to BTS one and two, back to School
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  Speaker 1: one and two this summer and potentially holiday on the
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  Speaker 1: strength of this deal and some of the less well
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  Speaker 1: capitalized competitors going by the wayside. Is Bloomberg already reported
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  Speaker 1: toys are us huge opportunities out there, so Bert, this
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  Speaker 1: really goes to a fundamental question which frankly is at
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  Speaker 1: the heart of a quite a big swath of of
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  Speaker 1: the market, not just from retail stocks but also commercial
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  Speaker 1: real estate. How do you evaluate this property? And you know,
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  Speaker 1: is the deal that Edward Lampert is getting is it
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  Speaker 1: a good deal for him? Or is a good deal
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  Speaker 1: for Sears. It's a good deal for Eddie Lampert. It's
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  Speaker 1: always a good deal for Eddie Lampert, seeres Lisa. It's
• 10:39
  Speaker 1: rarely a good deal for Sears. So how much is
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  Speaker 1: he paying do we know he's paying? He's paying in
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  Speaker 1: aggregate if he buys the quote unquote bundle, that's about
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  Speaker 1: one point five billions, So it gives Sears enough cash
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  Speaker 1: to fend off Stein mart Bloomberg's report Traveling Trading Law
• 10:55
  Speaker 1: as well sees other companies contracting and collapsing. So what
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  Speaker 1: does this mean though, about the value of the underlying
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  Speaker 1: property that he's getting and what might it mean for
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  Speaker 1: the broader swath of retail connected commercial real estate out there.
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  Speaker 1: You're asking the important question, Lisa, and what it What
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  Speaker 1: it means is that is commercial real estates traded down,
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  Speaker 1: as reported on the Bloomberg by as much as seventy
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  Speaker 1: eight percent in the last year. There's underlying value in
• 11:22
  Speaker 1: the A properties, of which Sears has a lot because
• 11:24
  Speaker 1: it was the anchor tenant, and many of the great
• 11:26
  Speaker 1: American malls building the sixties A properties are the higher
• 11:31
  Speaker 1: end malls, okay, and the best of the best, and
• 11:34
  Speaker 1: Sears is co located in a lot of places that
• 11:38
  Speaker 1: have good co anchor retail chains most importantly can be
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  Speaker 1: converted to mixed use lifestyle centers. So amounting of money
• 11:47
  Speaker 1: for Lambert to make, an amount of money for Lambert
• 11:49
  Speaker 1: to make on home delivery, home improvement, Ken Moore Repairs
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  Speaker 1: and Services and controlling the master leases is brilliant. They're
• 12:00
  Speaker 1: still selling stores, right, still selling stores and what's in
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  Speaker 1: the store. The lands End product is the best we've
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  Speaker 1: seen in five years. Cotton, very little oil and synthetic,
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  Speaker 1: very little rayon base, better product in many cases than
• 12:15
  Speaker 1: what Target and some of the leading mid tier department
• 12:19
  Speaker 1: stores have. So lands Ends doing well. They're compete They're
• 12:23
  Speaker 1: competing with the food retailers going bankrupt, from Tops to
• 12:27
  Speaker 1: win Dixie to Bielow Bloomberg reported filed recently. And I'm
• 12:31
  Speaker 1: not pro Sears, hoping for the best, but concerned for
• 12:37
  Speaker 1: the worst. But in the time being, this is a
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  Speaker 1: lucky deal for Eddie Lampert and not such a great
• 12:42
  Speaker 1: deal for Sears. Yeah, I'm really struck by what you
• 12:45
  Speaker 1: just said. It's always a good deal for Eddie Lampard.
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  Speaker 1: Is this a conflict of interest, Lisa your present point,
• 12:53
  Speaker 1: it arguably is a conflict of interest. We've been following
• 12:56
  Speaker 1: Eddie Lampert and Marty Whitman for close to twenty years
• 12:59
  Speaker 1: since the Kmart bankruptcy, where the unsecured has got next
• 13:03
  Speaker 1: to nothing in terms of recovery. Eddie Lampert Third Avenue Capital,
• 13:08
  Speaker 1: to your point, cornered the real estate and monetized it
• 13:12
  Speaker 1: and made billions off of it. So good deal for
• 13:15
  Speaker 1: Eddie Lambert on the Kmart bankruptcy. Good deal for Eddie
• 13:18
  Speaker 1: Lambert on the combination of Sears and Kmart, Uh, not
• 13:21
  Speaker 1: such a good deal for for every everyone else on
• 13:25
  Speaker 1: UH the secured side, the unsecured side, the supplier side,
• 13:29
  Speaker 1: the shopping center side, and especially the shareholders side. Is
• 13:32
  Speaker 1: the stock roared up significantly this morning and has come
• 13:36
  Speaker 1: back in the first hour of the news just quickly.
• 13:39
  Speaker 1: But today did the SA the merchandizes at at Sears
• 13:44
  Speaker 1: and whoever is controlling kind of where the brand gets
• 13:46
  Speaker 1: sold other than the Black is Stanley Black and Decker deal?
• 13:50
  Speaker 1: Do they have? Do they see something about the future
• 13:53
  Speaker 1: retailing which more traditional retailers are missing. They do see
• 13:57
  Speaker 1: something in the future of retail is UH as you
• 14:02
  Speaker 1: you lease? Lisa and Tom Keane have reported so well.
• 14:05
  Speaker 1: So often is family formations delayed, so you have a
• 14:08
  Speaker 1: lot of rescue pets in the house, So people are
• 14:11
  Speaker 1: buying for pets now, they're buying apartments, now they're buying homes.
• 14:14
  Speaker 1: And as BJ's reported on its website over the weekend,
• 14:18
  Speaker 1: people can't even assemble a swing set, so how are
• 14:21
  Speaker 1: they going to put in a washer dryer? For Ken
• 14:23
  Speaker 1: Moore Sears gets the services high margin and gets the
• 14:27
  Speaker 1: customer loyalty for life, so brilliant as people are getting
• 14:31
  Speaker 1: married ten years later forming families, and it's on an
• 14:35
  Speaker 1: up cycle for all including Sears. And if you can't
• 14:38
  Speaker 1: put together an Ikea chest, this service is for you.
• 14:40
  Speaker 1: Bert Flicking, j, Managing director at Strategic Resource Group in
• 14:44
  Speaker 1: New York. We love having you on. Thank you so much.
• 15:02
  Speaker 1: The ten year treasury hitting more than three percent? What
• 15:05
  Speaker 1: will that do for investors? Or two investors? Well? Holly
• 15:08
  Speaker 1: List is Managing director of Futures and Commodities Group for
• 15:11
  Speaker 1: B T I G, joining us from Chicago. Holly, thank
• 15:15
  Speaker 1: you very much for being with us. Begin by telling
• 15:17
  Speaker 1: us about treasuries at the three percent. What do you
• 15:20
  Speaker 1: think would happen if they were to reach that level
• 15:23
  Speaker 1: and stay there? Currently the ten your treasury trades at
• 15:27
  Speaker 1: two point nine seven percent. What's so magic about three
• 15:32
  Speaker 1: That's a good question, and I think for a lot
• 15:34
  Speaker 1: of people it's just the fact that it's a round number.
• 15:37
  Speaker 1: It tends to both attract people and it also repels
• 15:40
  Speaker 1: as well. So I think the critical statement you made
• 15:44
  Speaker 1: was not only if it gets three percent, but if
• 15:46
  Speaker 1: it stays there. And actually i'm looking at just above
• 15:49
  Speaker 1: three percent is critical. It's actually three point oh five,
• 15:53
  Speaker 1: So that's going to be the level that I'm watching at.
• 15:55
  Speaker 1: And also, like you said, does it stay there? Because
• 15:58
  Speaker 1: I think clearly there's a lot of concern as we're
• 16:01
  Speaker 1: approaching this magic three percent level, But there's also going
• 16:04
  Speaker 1: to be people that feel that there's value in there
• 16:07
  Speaker 1: because we haven't been up near three percent since at
• 16:11
  Speaker 1: the very beginning often, and like you had mentioned, does
• 16:14
  Speaker 1: it stay there? It didn't really stay there back then.
• 16:17
  Speaker 1: So if we don't stay there again, we just go
• 16:20
  Speaker 1: up and test that level, there's gonna be people that
• 16:23
  Speaker 1: are going to look at value at that rate and
• 16:26
  Speaker 1: want to put some money to work at investments at
• 16:28
  Speaker 1: that level. So it is going to attract people, and
• 16:32
  Speaker 1: it's also going to repel them. Why have ten year
• 16:35
  Speaker 1: yields risen so much in the past week or five days, Well,
• 16:39
  Speaker 1: there's a couple of things. You've had some of the
• 16:41
  Speaker 1: f O and C members talking, and they've been a
• 16:44
  Speaker 1: little bit more hawkish. They've been saying that they can
• 16:47
  Speaker 1: see three, possibly even four hikes this year, and so
• 16:51
  Speaker 1: they're thinking that the rates are going to be going
• 16:53
  Speaker 1: higher just as a result of what the FETE is doing.
• 16:56
  Speaker 1: But the FET is of course going to be responding
• 16:59
  Speaker 1: to what's going on in the economy. We have seen
• 17:01
  Speaker 1: some stronger data. We certainly saw it this morning with
• 17:04
  Speaker 1: the existing home sales came out stronger than had been expected,
• 17:08
  Speaker 1: not as strong as they were in February, but still good,
• 17:11
  Speaker 1: healthy numbers. So that's part of it. Also, you've got
• 17:15
  Speaker 1: commodities have been rallying and as a result of that,
• 17:18
  Speaker 1: people are thinking that there's going to be inflation percolating here,
• 17:22
  Speaker 1: and so that's also bidding up the yields, taking prices down.
• 17:26
  Speaker 1: So crude oil is at levels that we haven't seen
• 17:29
  Speaker 1: in a while. The dollar index has been coming off,
• 17:32
  Speaker 1: although not today, and so those type of inflationary pressures
• 17:35
  Speaker 1: are also concerning the bond market. When did those concerns
• 17:40
  Speaker 1: turn into action? What does it happen? What what has
• 17:42
  Speaker 1: to happen in order of people to change what they're doing.
• 17:46
  Speaker 1: I think you're going to have to see more you.
• 17:49
  Speaker 1: I think you're gonna need to see more of the
• 17:50
  Speaker 1: actual inflation statistics, the one that the FED tendants to,
• 17:54
  Speaker 1: like the PC personal consumption expenditures, that has not been
• 17:58
  Speaker 1: anywhere near their ten percent target, So I think you're
• 18:01
  Speaker 1: gonna really need to see that indicator start moving higher
• 18:05
  Speaker 1: and getting closer to the fed's target for people to
• 18:08
  Speaker 1: believe that number one, inflation is here and is going
• 18:11
  Speaker 1: to stay and the FED is going to respond to that,
• 18:13
  Speaker 1: or if you don't see those inflation numbers start picking up,
• 18:16
  Speaker 1: then that's why I think you could have sort of
• 18:18
  Speaker 1: a top at this three percent level, you know, Holly.
• 18:21
  Speaker 1: One thing I'm trying to make sense of is that
• 18:23
  Speaker 1: the yield curve pretty much across the maturity levels UH
• 18:27
  Speaker 1: seems to be close to the narrowest since two thousand
• 18:30
  Speaker 1: seven usually indicated usually indicating UH slower longer term growth.
• 18:36
  Speaker 1: Doesn't this feel incoherent with rapidly rising ten year treasure yields?
• 18:42
  Speaker 1: It absolutely does. But that's one of the other reasons
• 18:46
  Speaker 1: why we are flattening is because there still is a
• 18:48
  Speaker 1: lot of demand for the long end of the curve.
• 18:51
  Speaker 1: Number one, people do see value as you're approaching three percent,
• 18:54
  Speaker 1: but also you've got people that are pensioners, long term investors,
• 18:59
  Speaker 1: You've got insured companies that have demand at the long
• 19:03
  Speaker 1: end of the curve, and so they are buying treasuries
• 19:06
  Speaker 1: ten years on out. And you also have foreign investors
• 19:10
  Speaker 1: who don't have these type of yields in their countries,
• 19:13
  Speaker 1: and so they're going into the US market. And that's
• 19:15
  Speaker 1: also what is keeping the longer term rates lower relative
• 19:20
  Speaker 1: to the short end, and that's why we are seeing
• 19:23
  Speaker 1: the flattening of the curve. But yet you're not feeling
• 19:26
  Speaker 1: it necessarily in the economy or in the stock market,
• 19:29
  Speaker 1: or feeling like there's a recession imminent for that matter. Hollie,
• 19:33
  Speaker 1: what's your best bet? Where do you think ten year
• 19:34
  Speaker 1: yields go from here? I think they are going to
• 19:38
  Speaker 1: test that three percent. I think you are probably going
• 19:41
  Speaker 1: to go through it. The treasury futures are notorious for
• 19:45
  Speaker 1: slicing right through a critical level, and since we're all
• 19:48
  Speaker 1: looking for three percent, I do think they go through it.
• 19:50
  Speaker 1: I don't think you have a lot of sustainability at
• 19:53
  Speaker 1: this point above that three oh five that I am
• 19:55
  Speaker 1: looking at, and so I think you probably go up
• 19:58
  Speaker 1: there initially, but they you get a lot of demand
• 20:01
  Speaker 1: and come back down. How much you come down, you
• 20:03
  Speaker 1: could probably go to about say two eight five in
• 20:06
  Speaker 1: the near term. Given that I don't think three will laugh.
• 20:11
  Speaker 1: Holly Liz, thank you so much for joining us. Holly Liz,
• 20:14
  Speaker 1: Managing director for the Futures and Commodities Group at bt
• 20:18
  Speaker 1: i G. We talk a lot in the US about immigration,
• 20:38
  Speaker 1: partly because President Trump has made it such a prominent
• 20:41
  Speaker 1: part of his campaign and his platform, and he was
• 20:44
  Speaker 1: tweeting again today about it. Uh. Immigration concerns, though, are
• 20:48
  Speaker 1: are pretty prominent, prominent throughout the country, and our next
• 20:53
  Speaker 1: guest has been dealing with a flood of refugees from Venezuela.
• 20:58
  Speaker 1: Our next guest I am to bring in the President
• 21:01
  Speaker 1: of the Republic of Columbia, Juan Manuel Santos. President, thank
• 21:05
  Speaker 1: you so much for being here. I want to talk
• 21:08
  Speaker 1: about the refugees that you're getting from Venezuela. Some people
• 21:12
  Speaker 1: have said this about a hundred thousands of legal immigrants
• 21:15
  Speaker 1: coming each month, probably many more. How much do you
• 21:20
  Speaker 1: think that will decline in the upcoming months and how
• 21:23
  Speaker 1: are you handling it? First of all, thank you for
• 21:26
  Speaker 1: having me, and it's a great pleasure to be here
• 21:29
  Speaker 1: at Bloomberg. The situation is a very serious situation because
• 21:37
  Speaker 1: it's a flow that is increasing every day. The situation
• 21:41
  Speaker 1: Venezuela is worshiping, and that means that more people are
• 21:47
  Speaker 1: going into Columbia to seek a better life, and not
• 21:51
  Speaker 1: only Colombia, they're going to other countries in South America.
• 21:56
  Speaker 1: We have already more than one million. That a lot
• 22:00
  Speaker 1: of people. If you compare that for example, it's double
• 22:04
  Speaker 1: the total immigrants or refugees that Europe has absorbed from
• 22:09
  Speaker 1: Syria twice, and the numbers are increasing. This of course
• 22:15
  Speaker 1: puts a lot of pressure on our institutions or health
• 22:17
  Speaker 1: system or education system, but we're coping with that. We
• 22:23
  Speaker 1: We have been trying to be generous with the Venezuelans
• 22:27
  Speaker 1: that I think it's our responsibility. It's the way we
• 22:30
  Speaker 1: approach this type of problem, trying to help them. But
• 22:34
  Speaker 1: at the same time we need to to control the
• 22:39
  Speaker 1: flow in the sense that it has to be a
• 22:44
  Speaker 1: well administered process, otherwise the consequences are are serious, and
• 22:51
  Speaker 1: we're handling that day by day. We were learning from
• 22:55
  Speaker 1: other experiences. We sent to people from our Ministry of
• 22:59
  Speaker 1: Foreign Affair, some immigration institutions to country like Turkey to
• 23:04
  Speaker 1: see how they cope with their refugees, with their uh,
• 23:09
  Speaker 1: their problems, and we've been searching for other sources of
• 23:13
  Speaker 1: information and experiences, and we're learning that we're learning to
• 23:17
  Speaker 1: cope with that. Hopefully we can find and the Venezuelans
• 23:22
  Speaker 1: can find a solution to their problem, because it's really
• 23:25
  Speaker 1: an absurd situation. Richest country in Latin America, Venezuela, is
• 23:29
  Speaker 1: now having a situation where the people are virtually or
• 23:35
  Speaker 1: not virtually, really dying of hunger. And this is the
• 23:40
  Speaker 1: country that has the most the biggest oil reserves in
• 23:44
  Speaker 1: the whole world. Going through that process, well, this is
• 23:47
  Speaker 1: a very, very sad situation, and that's why we're also
• 23:52
  Speaker 1: doing every effort possible to try to have a transition
• 23:56
  Speaker 1: as soon as possible, because this is a situation that
• 24:00
  Speaker 1: bad for everybody. President Santa So, I'm glad you mentioned
• 24:03
  Speaker 1: oil because oil is a major export of Colombia, and
• 24:07
  Speaker 1: I wonder if you could speak a little bit about
• 24:09
  Speaker 1: the economy of Columbia for people that may not be
• 24:12
  Speaker 1: familiar with the country and mentioned specifically what you're doing
• 24:15
  Speaker 1: in the area of information technology and the fiber optic
• 24:20
  Speaker 1: network in the in the country. Thank you for that question. Yes,
• 24:23
  Speaker 1: oil is important commodity for us. It's the most important
• 24:28
  Speaker 1: commodity in terms of exports, and we coped with the
• 24:35
  Speaker 1: followed the pressive oil in a I think in a
• 24:37
  Speaker 1: very pragmatic way. And today the economy is is quite
• 24:42
  Speaker 1: strong in spite the decrease in the price of oil,
• 24:46
  Speaker 1: even though this has come a bit higher in the
• 24:49
  Speaker 1: last months. We are diversifying or economy um. To give
• 24:54
  Speaker 1: you a reference, when we came into power, we did
• 24:58
  Speaker 1: not have investment grade. Today we have investment grade. We
• 25:02
  Speaker 1: introduced in our constitution the concept of fiscal responsibility and
• 25:06
  Speaker 1: we have a fiscal rule whereby we are obliged to
• 25:13
  Speaker 1: follow a path of fiscal deficit in order to maintain
• 25:19
  Speaker 1: the confidence of international markets. This has been very successful.
• 25:23
  Speaker 1: We are probably the only country in Latin America that
• 25:28
  Speaker 1: went up to notches in our credit ratings and have
• 25:32
  Speaker 1: maintained our investment grade throughout all these years, inspite of
• 25:37
  Speaker 1: the problems that the world and Columbia has has had.
• 25:40
  Speaker 1: And in terms of technology, we made a very ambitious
• 25:45
  Speaker 1: program to connect every single municipality with fiber outcript and broadband,
• 25:50
  Speaker 1: and we have fulfilled that. Now every single every single
• 25:56
  Speaker 1: municipality is connected and we have given compute to the people,
• 26:01
  Speaker 1: especially the poor people. To give you a figure, we
• 26:06
  Speaker 1: had twenty four boys and girls per computer at the
• 26:11
  Speaker 1: beginning of the government eight years ago. Today we have
• 26:15
  Speaker 1: three per computer. And what are we doing with that.
• 26:19
  Speaker 1: We are starting to teach them to use technology in
• 26:25
  Speaker 1: in ways that will improve their education. We have tell
• 26:30
  Speaker 1: education in the schools, we have telemedicine in the rural areas,
• 26:35
  Speaker 1: and that has is starting to improve our productivity quite
• 26:39
  Speaker 1: a bit. So we just have a little bit of
• 26:42
  Speaker 1: time left. I'm curious. You're expecting to leave office later
• 26:46
  Speaker 1: this year. What's your next step. Well, I'm going to
• 26:51
  Speaker 1: be a grandfather. Congratulates for the first time. I'm going
• 26:54
  Speaker 1: to take care of my granddaughter. I want to go
• 26:56
  Speaker 1: to be a full time grandfather. I have a lot
• 27:00
  Speaker 1: of offers to teach and to give conferences, and I
• 27:04
  Speaker 1: want to write. The experience that we have had these
• 27:07
  Speaker 1: eight years is a very interesting experience in many ways,
• 27:10
  Speaker 1: and I think it's my obligation to share that experience
• 27:13
  Speaker 1: with the world. And so I'm going to right teach
• 27:17
  Speaker 1: and take care of my grand daughter. Are you still
• 27:18
  Speaker 1: going to be involved in politics at all? No? No,
• 27:21
  Speaker 1: I think and that I had my chance and I
• 27:26
  Speaker 1: would leave my successor to be himself. There is a
• 27:33
  Speaker 1: very bad habit in Latin America of presidents trying to
• 27:39
  Speaker 1: maintain a bit of power, and that is usually contra productive.
• 27:44
  Speaker 1: Thank you very much for spending time with US President
• 27:47
  Speaker 1: Manuel Santos, the President of the Republic of Columbia, much appreciated.
• 27:51
  Speaker 1: Thank you for this opportunity. Thanks for listening to the
• 28:01
  Speaker 1: Bloomberg P and L podcast. You can subscribe and listen
• 28:04
  Speaker 1: to interviews at Apple Podcasts, SoundCloud, or whatever podcast platform
• 28:08
  Speaker 1: you prefer. I'm pim Fox. I'm on Twitter at pim Fox.
• 28:12
  Speaker 1: I'm on Twitter at Lisa abramoits one before the podcast.
• 28:16
  Speaker 1: You can always catch us worldwide on Bloomberg Radio.