Bannon’s Indictment Is the Fight Both Sides Want

Bloomberg Business Weekend iTunes, SoundCloud, or Bloomberg dot Com. You can also listen to our radio show at two pm Eastern Time on the Bloomberg Radio or watch us on YouTube search Bloomberg Clovel News. We're tracking that on this Monday. Also tracking what's going on in COVID. We did see New York City asking healthcare providers to give a booster basically to anyone who would cross one as New Cases Pickups team. And then we are Tim seeing a new

wave of infections across Europe really showing no signs. It's like that was really the big story for like over the weekend. Yeah, perhaps the most controversial was what's going on in Austria. It's beginning a lockdown for people who haven't yet been vaccinated. So if you haven't gotten the shot,

you're going into lockdown. Ireland got set to recommend people start working from home again, the UK spanning it's booster program, Prime Minister Boris Johnson saying that he wouldn't rule out another wave of lockdowns this winner if infection rates jump. All right. Well, one of our go to voices over the last year or so has been Dr Mario Ramirez. He's managing director of the national nonprofit organization Opportunity Labs.

They work across different sectors healthcare, education, housing, workforce. It's all about really improving outcomes for low income Americans who have been severely impacted, certainly during the pandemic. He also served as emergency medicine doctor and flight surgeon in the U S Air Force, Acting Director also for the Office of Pandemic and Emergency Threats at HHS during the Obama administration. He is back with us on the phone from Washington, d C. Dr Amira is good to have you back

here on Business Week. How are you and how do you see the current round of COVID headlines? Well, thanks for having me back, Carol, It's nice to be with you. Um. You know, I think you guys had a great lead in there. Uh. You know, for the last eight weeks or so, we have enjoyed some decreasing cases here in the United States, and I think a lot of us were really opal that the trend was going to continue.

But certainly over the last week and a half we've seen some troubling signs um maybe most notably capped off this afternoon with Dr Fauci announcing that cases are up by about eleven over the last week here in the

United States. And I think, you know, many of us are concerned that the trends we're seeing in Eastern Europe, where vaccination rates in some countries and most notably Germany are very similar to what we have here in the United States, are an ominous sign for what media ahead for some parts of the country in the next few

weeks ahead. But should we be counting or obviously we should be counting cases, but should we be having this reaction to when we see cases going out the vaccines are available widely, should we be focusing on hospitalizations and focusing on who gets severely sick? Because the vaccines have been proven doctor to be effective in preventing severe hospitalization

and death. So You're making a great point, tim, And what I would say is that in really well vaccinated countries, most notably Spain and Portugal, where vaccination rates are north of in some areas, they've been able to sort of really separate the number of cases from the number of hospitalization, meaning that even when their cases go up, so much of their population is vaccinated that the hospitalization level seemed

to be staying pretty flat. But in countries like Germany, for instance, whose vaccination rate is almost exactly what we have here in the United States, there are still so many unvaccinated people or people whose immunity is waning from vaccines that they received six to eight months ago, that as their case counts start to go up, their hospitalizations start to go up significantly as well. Now, of course, we know that that is a little bit of a lag indicator, right There can be two to three weeks

before hospitalizations start to go up. And so my concern, what I think the concern that a lot of other people have, you know, is that if we chalk it up essentially to saying that we have enough of the country vaccinated that we won't see hospitalizations go up, that's not necessarily what we're seeing from some of the countries in Eastern Europe. So what do you make too of New York saying basically, if you want a booster, go get it. Should we just kind of opened up the

flood dates here. Well, you know, this is an area of ongoing debate, Caroline, and I think many folks, particularly you know Dr Fauci, Dr Kessler, Dr Murphy, um, you know, and myself, although I would include myself in that same company, UM, you know, have advocated strongly for a broad based booster

rollout since the beginning. UM. You know, when I look at the data, and what I think, you know, many of them have said is that the overseas data from countries like Israel, UH and other places suggest that boosters really are needed, and that they can have a significant increase UH in the immunity for your population. And that's part of why the Israeli case counts have dropped so

precipitously over the last few weeks. UM. But there are certainly other folks UH in the academic community, on the CDC's advisory committee who have said that we don't fully understand the risk of myocardias associated with some of these vaccines. And that we need more information before we really give a determination about how broad WAYLD roll out the boosters,

and I think we're many of them. Well, what are I was going to say is that I think you know of us believe that the mile card is potentially caused by the vaccine is barely self limited, but the risk caused by another surge is quite real, And so in my mind, I think that the benefit part of that equation really favors of birth much broader based booster rollout than we've done so far. But I think there's so much confusion when it comes to who needs it

and when they actually need a booster. And I've been talking about this Carol with friends and family and talked about it over the weekend co workers to today. When do we know when we need a booster? When should we get a booster? How how do we know how

were antiboddies are doing well? Dr Mirrors? To be fair, like I had signed up for a booster, although I didn't quite the hospital that I had gotten my initial shots had reached out to me and said, hey, you're free to now get a booster, and then I didn't really i'd signed up, had it all set and then I realized, you know what, I don't really needle the criteria of it, UM, and so then canceled it because I just felt not right. And I do think there's some confusion about should we just go do it, um

and and just move on. You're both as right. There is a lot of confusion about this, and I think a lot of this stems from the disagreement that we saw between um, some of the White House officials from the FDA and from the CDC's advisory can make several weeks ago, when they were trying to figure out how broadly to authorize the boosters, uh, you know, And I think a lot of the confusion that we're seeing now

is the tail end effect of that. UM. You know, even within lots of the scientists in those two groups, we see folks disagreeing about how broadly booster should be rolled out, and at least two conflicting messages. That's a very nuanced argument, and it's hard for the public to fully taken, and I think understand sometimes. UM. What I think is becoming more clear from overseas data are that more and more countries are expanding the kind of population

that should receive boosters. And what I think we should see here in the United States, um, because we have lagged behind Europe typically a bouye about four to six weeks UM, is that significant parts of that continent are seeing a serious rise in cases. And so folks are here in the United States on the fence about whether or not they should pursue a booster for themselves. You know, I think the evidence is quite good that booster shots

can really boost her immunity. Right as we get into this period where folks are getting together over the holidays, where the weather it's turning colder, it just makes good sense from my perspective, for as many folks as possible to go out and get a booster shot. Kind of like a no brainer. Just when it meant to the headline crossing the CDC revising Japan COVID nineteen travel advisory to the lowest risk level, and tim we're seeing a lot of the back and forth between countries saying who

can come in or reopening borders. Yeah, and where I think we're going to see a lot more of that too, where you gonna I'm laughing because you know, again Dr Ramirez, it's like, Okay, well we know that we should get boosters, but should people who got fviser get a visor shot or people who got Maderna get a Maderna shots or they mix and match. Again, it seems like there's no clear guidance on this, tim and I keep going back and forth, like, are you gonna get when you can

get your booster? Where you go different? When you apologies to people who listen to our show regularly because that's something I've been talking about for three weeks. Well, you're right, you know, and needs of the same questions that I get when I work in my in my clinical life

every day. Um, And I think at this point there is not a clear recommendation for people to try to actively mix boosters except for people who received the Johnson and Johnson as their first There it seems to be fairly strong evidence that those folks should go out and

get an mr and a based booster. But the mixing studies between people who got fiser and who got madernas shows that there's relatively little different in the immunity that's brought on by mixing between those two categories, And so right now there's not a firm recommendation to actively try to mix between those two with the data shows is that mixing them is safe and so people shouldn't be concerned about side effects. Um, but the good news is that if you've got fiser, you got a Fiser booster.

If you mix it with madernas, you're going to be on the same level of immunity relatively speaking, if you get a booster from any of those manufacturers. All right, well that's good to know. Hey, just got about seconds here. You are somebody who's worked within the administration, the Obama administration. What are you hoping the current administration is doing to

plan for the next health pandemic? Well, I think you know, as I said, I think there's there are concerns of a wave of some magnitude that are coming this way.

And so what I hope the administration is really planning for our good plans to position adequate supplies of monoclonal antibodies, good supplies of PPE for folks, and as we get you know a little bit later into this year when we talked about the oral anti virals, I hope that they're formulating a good plan for distribution so that folks have access to those medications if they're approved because time is really of the essence when it comes to starting

some of these new therapeutics, and just fifteen seconds testing absolutely necessary, especially as we're gonna be mixing between states, folks coming together with different families. Uh, it absolutely makes sense to try and utilize those tools right now. Did my test this morning? My weekly test? Oh? Yeah, I haven't done. I do mind on Thursdays? Okay, I don't know why I'm a Monday too. I don't know. It

kind of varies. But look, we are really lucky here that we do have that opportunity because if you go and buy try to buy a test in a store, it's difficult to do. Those are also sometimes antigen tests, not PCR tests, but there are plenty of places you get tested right now, feel very spoiled that they make it so easy you here. Um certainly at Bloomberg. Hey, thank you so much. Dr Mario Ramirez, matching director at the national nonprofit organization Opportunity Lives, joining us on this Monday.

This is Bloomberg. This is Bloomberg Business Week with Carol Masser and Bloomberg Quick Takes. Tim Stinovic from Bloomberg Radio tweets on selling shares again, sparing with the U. S. Senator on Twitter. And then you've got famed investor Michael Bury weighing in again on Elon Musk. Again. We've been here before again Ditto, ditto, ditto. Keeping track of it all, uh and keeping us focused on what really matters is our Bloomberg technology reporter Dana Hall joining us via zoom

in San Francisco. So good to see you on zoom. Um Man, I feel like, didn't we do this story last week? Danna? Yeah, it's groundhold day. I mean yeah, every you know, every I think that Elon Musk is very shrewd about how social media works and how the

mainstream media works. Frankly, I mean he knows that on a weekend when most newsrooms are thinly staffed, if you want attention, and he could just start something and um, you know, this weekend it was about sort of going after Bernie Sanders, who has called for you know, billionaires to pay their fair share. I would know that this

was not really a spat or sparring. I mean, Sanders did not respond, So it's like this one sided conversation where Musk keeps tweeting at Bernie Sanders, but as far as I know, Bernie, I don't even know if Bernie Man's his own Twitter account. I mean, it could be Stafford and he doesn't reply to people, so it's a bit one sided at this point. Well, we should know that he didn't even call out Elon Musk and a tweet.

Here's what Bernie Sanders wrote, quote, we must demand that the extremely wealthy pay their fair share, period And look, it's fair to say that it was directed to people like Elon Musk. After all, he is the wealthiest person in the world. What do we know about Elon Musk and taxes right now? Because you've been on there've been on the program with us before, and you reminded us that this is the guy who's moved from California to Texas and moved the company's headquarters from California to Texas.

So what do we know, Well, the company headquarters have not moved yet. I mean, Musk announced that Tesla will move its headquarters from Palo Alto to Austin, but they haven't moved yet. I mean I check you know, I check out on the regular with the Texas Secretary of State. I mean, if you look at all of the filings

for Musk's share sales. I mean the headquarters are still in Palo Alto, but yeah, he himself has moved to Texas, and so as he exercises these tax options, it will be interesting to see how much of a text how much he owes to California, since the options were earned when he was still living in California. But yeah, I mean he has to pay taxes. Um. You know, some members of Congress would like billionaires to pay more, but

I mean that's still all under debate. Unless I checked, the sort of tax on billionaires was not part of the reconciliation package. But I haven't seen the latest today. I have no idea what the discussion is, but I think that you know, Musk is very sensitive to taxes. He also thinks that there's a lot of government waste,

and he should know. I mean, he's a government contractor, right, I mean, SpaceX gets a lot of money from the Defense Department for launches, and I think that he sees a lot of waste and bloat in the federal government in general. So another reason why he's, you know, not so crazy about being taxed himself. He wants to know

where the money is spent. Okay, sees sees where the waste is, but at the same time is the beneficiary of that for SpaceX And also, as you have noted in the past, UH, federal tax credits to subsidize the purchase of electronic vehicles have certainly helped the company Tesla absolutely, I mean and Tesla Tesla got a really important Department of Energy loan very early on and its founding Um, you know that it paid back in full with interest, But I mean, you know, it's it's just it's yeah,

it's an interesting conundrum, you know, being opposed to taxes on your personal wealth, but being the beneficiary of tax pay your subsidies for your companies. For sure. Can't wait for the next round of government negotiations. Just quickly, Danna kind of at thirty seconds, is there something like you's going, hey, look at this flashy thing I'm doing on Twitter. Is there something we should really be focusing on right now

when it comes to Tesla? Just quickly. I mean, I think the supply chains shortage is still an issue for all automakers. Tesla has spared better than most because it's able a pivot quick fairly quickly and has a fairly integrated supply chain. Um, you know, who know. I mean, it's always the kudos like you know, zig werother zag. I mean, just because he's tweeting about something doesn't mean, you know, is it distraction or is it really was on his mind? I just you know, just yeah, all right,

thank you as always really appreciated. Downa Hall technology reporter at Bloomberg News via zoom from our San Francisco bureau. You're listening to Bloomberg Business Week with Carol Masser and Bloomberg Quick Takes Tim Stinovic on Bloomberg Radio. Well, when this crossed the Bloomberg on Friday, we knew we wanted to hear more from Bloomberg Business Week's Josh Green. What crossed, of course, Friday, was the indictment by the Justice Department

of former Trump White House strategist Steve Bannon. Bloomberg Business Week national correspondent Josh Green, joining us now on the phone in Washington, DC, is the author of Devil's Bargain, Steve Bannon, Donald Trump and the Nationalist Uprising, including other books, also with us as Bloomberg Business weekender Joe Webber with us on the remote access in Brooklyn, I have to say we did. We're like Tim and I like, we

gotta talk to Josh here, Joe. Yeah, I mean, Josh obviously wrote the Bandon book when when I didn't even get a heads up from him that he was working on this, and then I saw this the headline cross and I was like, yeah, of course, Like, there's nobody I want to hear more about um Bannon from right now than than Josh. So so Josh, bring us up to speed on on what what you wrote and kind

of where things stand on the band in Front. Well, basically, I mean, the news was that Bannon was indicted by the Justice Department, and this is the first time in almost four decades that they pursued somebody for criminal contempt Congress because of Bannon's refusal to testify to the January six Commission. And I think what's interesting about the news is sort of twofold. You know. What I write in the piece is that both sides in this fight are

getting what they want. Um. The real news on Friday was the Justice Department was going to issue this indictment and answer a question that a lot of anxious Democrats had about would Biden really go after this, or would he take some kind of pretext of not wanting to flame partisan passions and kind of let it go. We have an answer to that, Justice Bartman is going to fight. What's interesting is that Bannon wants to fight too, although

for entirely different reasons. What he is trying to do here basically is to demonstrate his loyalty to Trump by flaunting this congressional subpoena and you know, getting perp walked into the courthouse today, which I'm sure everybody saw on TV. Because he thinks this is the key to showing Trump that he's loyal and increasing his power, meaning Bannon's power

in Trump circling in Republican politics. You know, go ahead, please don't Josh, is it you know, if it's between being loyal and going to jail or making a scene and then kaving, what do you think? Which way do you think Bannon's tilting? Well, so, I know from from speaking to Bannon the last couple months, he doesn't really quite see it. Is that clear a trade off? You know?

His his refusal to testify is based on the claim that Trump as executive privilege, and that's something that the courts have yet to litigate um So, his bet in the short term is that he can do this and not pay any kind of a price, because it could be months or even years until courts decide, and maybe the Supreme Court ends up deciding whether or not Trump can claim executive privilege and whether or not Bannon is

subjected to that. Um I think the other part of the timing thing here is that Bannon is betting that Republicans gonna win back the House of Representatives next November and shut down this investigation. That wouldn't necessarily get him out of the clear with the Justice Department, but basically

this is a misdemeanor charge. He doesn't see any short term penalty that he's paying, but in the meantime, it enables him to make this very public display of loyalty to Trump, And sure enough, on Friday afternoon, Trump sent out a statement praising Bannon um for his obstinacy, which is a market uh flip flop of where Trump was on Bannon four years ago when he famously fired him from his White House job and issued a crazy press release referring to him as sloppy Steve um. So, Bannon,

at least as far as getting back in Trump's good graces. Uh, seems to be using this to to kind of get what he wants and not what Congress wants. Well, it's interesting too, we were just talking about Larry Summer says inflation risks bringing Donald Trump back to power. Uh, there's just a lot of things already looking at you know, the next presidential rate. Um, does Trump like Bannon? Still? Would he bring him into the fold again? You know? I don't think that Trump likes or dislikes people like

ordinary human beings. Do. I think he has a vector of is this person loyal and supportive and does he praise me? Or is this person someone who Trump views is disloyal and won't do his bidding, someone like my pents who Trump has been has gone after quite a bit the last six seven, eight months. I think that in terms of the way Trump views the world world, Bannon has clearly moved from the category of bad disloyal guy.

It's a good disloyal guy. And the key to having any kind of power in Republican politics today is to be seen as being in Trump's favor. I think Bannon Um, by doing this so publicly, has put himself in that category. Well, whether or not he pays any kind of a sentence or does any kind of jail time eventually remains to be seen. But in the short term, I think he's achieved what he set out to. Josh. What could he face though? What kind of jail time could he face?

I think he's facing. You know, it could be as much as thirty days to a year in prison to find, but I think it's a real doubt that it would be uh that much. I mean, he's looking at as I understand it, a misdemeanor charge, So this isn't something where you know, he's staring down any kind of a

lengthy Jailson's I mean. The other thing that occurs to me is if this drags on long enough, it seems entirely possible that a President Trump, after election where he'd win, could just turn around and pardon Bannon the way he's done once ready. So so Josh, uh, we we talked about banning here for a bit um In the most recent issue of the magazine. You also write about some developments in the E t F space, which is near near and dear to me as co host of Trillions.

We also had you on the podcast, but Uh, you know, they're kind of related a little bit here, right, because the E T s that you're writing about UM are actually this sort of like anti woke, anti E s G thing talked to us about the people behind them. Yeah, but you know it's funny. I hadn't thought of the

two stories related, but I think they are. I mean, what I wrote about in the magazine this week was this uh you know, kind of small but growing wave of right leaning exchange traded funds uh and related financial products as the Trump's back, there's the Trump non fungible tokens and uh you know, the desire or the aim of of some conservatives in the financial world to try and profit off the MAGA masses by offering them uh

financial products. In this case products was fairly high sees UM to try and win a customer base based essentially on their affiliation to Trump or their desire to kind of stick it to the kind of woke capitalist companies that Trump and other conservative rail about. So that's gonna be one of the interesting things going forward, is to see everything else in American life has become so polarized around politics. Will E T F too. There are a lot of conservatives out there who would like for that

to happen and make some money off it. That name of that company's second vote advisors, and how how is it going so far? Because politics and ETFs don't typically mix, that's right, I mean for for for a long time. Um, you know, various people have kind of tried to do some version of this. There was a h E t F for the Cigaret Maga that launched in tween. So far, they really haven't managed to amass a lot of money.

None of the none of the funds that I looked at, had managed to collect more than thirty five million dollars, which you know in an e t F industry that had I think about seven and twenty billion dollars in inflow and inflow so much this year isn't very much, you know. On the other hand, the bet that I think a lot of these people are making that there's going to be a backlash to e f G funding and that right leaning funds like this, uh we'll have

a bright future. Well, interesting to see what's going on. Hey, Joe Weber, thank you so much, editor of Bloomberg Business weekn of course, that last voice was Josh Green National correspondent of Bloomberg Business Week. Check out his stories online and in the magazine room. Yeah, I bet you let me drive. Oh no, no, no no. This is not a toy home all night. Please, I'll do the riding gravels. I want to drive. It's good question to drive. This is the drive to the globe. Well Dr Rod Down

on Bloomberg Radio. All right, So just about forty minutes left in today's trading session, and we've seen some pressure on equities technically weighing down, although I really look at things. The NASTAC one hundred or NASTAC excuse me, just down about six seven points as we speak, Dal off about twenty and the S and P five hundred. Call it little change, I mean little changed overall, but we're definitely off our highs that we saw earlier in the session.

Katerina Simonetti a senior vice president and private wealth advisor at Morgan Stanley Private Wealth Management. She joins us on the phone once again from Philadelphia. Katerina, how are you, good, tim and Carol, thank you for having me on the show. Okay, so help us make sense of not only what's happening today, but a time where We're starting to get calls from large banks about what they see as prudent investments for the year two, and I'm wondering what our audience should

be thinking about when it comes to investing. Well, tim We're in a bit of a transition, transition period and uh, this economic outload is very un sir. And all of the things that we were kind of just looking for and expecting to be affecting the market, like higher material costs and labor shortages um and that that should have been translated into the negative earning trovisions are not quite

happening yet. And that coupled with the fact did the market is so supported by retail investors that are want to stay fully invested, excited about this market as a matter of fact, almost you know, worried about missing out

on the growth of this market. You know, this raises some concerns about valuation, and in our view, this is the perfect time to be transitioning and preparing the portfolios for uncertainty that inevitably, maybe a little bit later than we thought, is going to work itself into the negative earnings trovisions and more volatility that we are expecting in

the first quarter of next year. So you agree then with the broader I know there's a research no DOT from Morgan Stanley Strategy teams today which essentially says stay away from US stocks and bonds next year. SEECAP had a returns in Europe in Japan. Are you on board with that? Well, I think there is still growth in the US. I am absolutely on board with the fact that there is going to be growth in Europe and

there's going to be growth in Japan. And undoubtedly US market is overvalued, and we ignored the international sector for such a long time because there were so many exciting opportunities here in the US. But with that said, US by no means is done. We just have to pivot towards some of the more defensive sectors, sectors like healthcare, like financials, like you know, perhaps non cyclical parts of technology that are more protective, more defensive, better positions for

next year. And if we do this with emphasis on quality, strategious positioning, and overall valuations UM security selections here makes a lot of sense. So we see opportunities in the US as well, not just what's interesting too is and I wonder how what your take is on this that what's going to have a bigger impact on global financial markets.

Is it going to be central banks taking their feed off the gas pedals and putting the brakes when it comes to stimulus, or is it going to be UM what we're going to see in terms of public programs globally budget cuts after unprecedented spending during the pandemic. Will that not necessarily have a bigger broader impact on the world economy and then ultimately financial markets, Carol, the environment is going to be such than interest rates are going higher.

We know that taxes are going higher UM, and our concern is that the demand levels that we're currently see are going to decline and the UM consumers ability to purchase goods and services at the levels that we're seeing right now is going to be declining. And we are concerned about the the decreasing levels of personal savings, you know,

which seems to be a pattern. So all of these things in combination are going to lead us to a more difficult environment, the environment of higher volatility, but still not the bear market. It's just going to be a more volatile number of corrections that can be absolutely expected, UM, and this is where we need to be strategic and pay attention to valuations, and pay attention to quality and

individual security selections more than ever. So, Caterine or I just want to make sure I understand what you're saying. Are you saying that consumer purchasing power for Americans will decline because of inflation? Well, inflation for quite some time came right, was was viewed throughout this entire year. We were having debates on whether it's transitory in nature or not.

And the big narrative from Federal Reserve was that it is that that the inflation numbers that we're seeing as direct result of this whole COVID environment in our of you,

perhaps it's not quite as transitory as it appears. Perhaps the inflation levels that we're seeing are here to stay, and we just have to adjust to this new normal of operating in the environment of higher costs and higher inflation, which is going to be a pretty big shock on the system and on the consumers and their ability to kind of just just get the basket of goods and services as that are accustomed to. Well, So, what is

your advice to investors at this point? Our advice to investors is to take a very close look at their investment portfolios. And definitely this is the time to gravitate towards the defensive way. For anybody who has not take taken profits yet, this is the time to take a close look at the affid allocation. Take some money off the table in some broad indexes like it since five

hundreds and Rustle two thousands. Take some money of the table, for example, for anybody who is overvalued in US, and route some to international exposure, and focus on the sectors like healthcare, like certain parts of technology, like financials that are positively worldly. That's uh to writing interestly like reads. We really like consumer stables, and this is the sector that generally does well in this environment. We tend to avoid consumer goods at the moment, you know, but we

still like services. So we see a lot of opportunity, a lot of really exciting opportunities in this market. But this is not the type of market where you can just kind of go on auto pilot and expect investment profolius to do well. This is the time to be strategic. Caterinea, help us understand long term here when you say that investors need to get defensive and start pulling a little bit of money from those areas that you talked about,

how long does that last? So I think there's general misconception between defensiveness and staying woll We invested, and a lot of times investors kind of just see that pool for being defensive as selling out of their equity is going into cash, which is always a mistake, and especially in the environment of higher inflation, where the cash it

really becomes the losing asset clause. You know, this is really the time for being defensive within the equity sector, where certain parts of the equities that had the art of unproportionately higher returns that that generally should be expected last year, or maybe just seen a strategic thinking when we look at the price, flexibility, strategic positioning of this company, they're a competitive advantage in the respective space. Maybe this is the time to improve the overall quality of equity

exposure and fix income exposure for that. For the matter of fact, this is going to be challenging times for bonds and portfolios all around. Well, it certainly feels that way. I mean, isn't it challenging just generally overall? I mean, to be fair, and we've said this many time on air that for the Federal Reserve. It's very easy to understand what policy moves to take when the world is following up hard. It's also very easy to figure out what policy moves to take when everything is gang bugs

gangbusters and going well. But we're in this really weird environment where it's maybe still a little unclear why people aren't coming back to the labor market. Uh, it's a little unclear exactly what's happening with the supply chain. We understand, you know, um, the bottlenecks, but the continuation and what's really the cause. I think it's fair to say, despite lots of conversations we had about it and even inflation, we see the numbers going up and we can explain

stories away. But it just seems a little mind boggling that there are still so many questions and it's hard to say what happens when global central banks start to alter policy, what happens when global government back off on you know, all these as systems that they provided their global citizens over the last eight, nine twenty months. Uh, a lot of questions out there, and it's very easy that we could see some kind of policy misstep now absolutely kind of life. Really do want to present um.

The one benefit that we have is the Federal Reserve that has been very careful about their messaging about setting expectations and delivering this very carefully kind of crossed messaging to so the general investing public note what to expect. So at this point in time, we know that they're going to taper the asset purchases and we can expect really types next year, perhaps one or two increases, but we know they're not going to take any drastic measures.

They're going to avoid shocking the system. They're still extremely supportive of the economy, which is growing, but inflation is becoming a concern, and it's not just concerned to us as consumers. This is concerned to the Federal Reserve, and this is probably, you know, one of the numbers that are looking at, you know, more than anything else. Utterina Seminetti, Senior vice president and private wealth Advisor, and Morgan Stanley Private Wealth Management, joining us once again on the phone

from Philadelphia. Katerina, thank you so much for taking the time. Thanks for listening to Bloomberg Business Week. Download the podcast on iTunes, SoundCloud, or Bloomberg dot com, and you can also listen to our radio show at two pm Eastern on Bloomberg Radio, or watch us on YouTube. Search to Bloomberg Global News