Crypto Exchanges Have a Plan to Beat Binance

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 Global News. Tim and I just broke down some of the cases, and I do think among those top headlines are confirmed cases in the US or forty seven percent excuse me in the weekending Sunday. So

that's the largest weekly rise since April. And we know even in the europe in you in European nations like they're opening up, Tim, but they're very cautious, uh, in terms of how they do it. It's not just that we're also seeing some vaccine news, the Watchington Post reporting that the FDA is expected to announce new warnings on Jane Jay COVID vaccine. We saw J and J shares

fall on that news. Well, let's get right into it with Dr Rohnda Meadows, President of Health Management Providence St. Joseph Help, joining us on the phone from Renton, Washington. Doctor Meadows, Um, how are you? I am doing great?

How are you doing well? You know, Carol and I late last week we started talking a lot about the variant, and we started talking a lot about what we should be doing even though we're vaccinated to protect ourselves as we continue to see cases increase, and we're just eager to hear from you how you're reading into the startling number of cases that we're seeing reported around the United States,

even when vaccinations are readily available. Well they're readily available, but we've got people who are not taking advantage of their their access the ability they actually get them. We talk about people being vaccine hesitant, but if we really looked at it, there's probably five different groups. People who decline the vaccine because they don't believe that COVID virus itself is going to be a harm to them or

to their loved ones. People who delay because they wanted to see how the vaccine is going to do in terms of long term time effects and immunity. And the people who have four recently decided that they want to get it now, they need to find access, transportation, and time out of work to go'll get the vaccine itself. And then finally, remember that our children at the age of twelve are not yet authorized to receive the vaccine.

They've got a lot of people who are unvaccinated. At a time when the COVID virus itself continues to grow and to mutate. The Delta variant is the one that we are all watching. It's the one that is the dominant COVID virus that is going across our nation as we speak. Um. That is its accounting for about of all hospitalizations from COVID and all almost deaths. Dr medus.

One of the reasons we love talking with you and all of the team at Providence St. Joseph's health is the first official case was confirmed of COVID nineteen in Washington State at Providence Regional Medical Center and Everett. That was back in Jevary January. I've got to say, is there any discussions that you guys are having a little bit of like tangles up the spine, saying, wait a minute, we've we've felt this before, we've seen this before, or is it different because we do have a playbook on

how to treat it, we do have vaccines. So what's the difference of people who might be listening to our broadcast right now and who might be a little nervous. Well, I have to tell you that what's different is we actually know quite a bit more than we did last January. Um. We actually know that the vaccine does work when it is received by people, and we know how to better treat people when they do come down with the viral

infection itself. We've got a lot of more things to do to help people now than we had last year. Our difficulty is now and making sure that we do the extra work and identifying where there are pockets of people who are unvacculated and helping them get access to those vaccines. And if they don't want it, then we have to make sure that they understand what risk they're

taking and what risk they're putting others out. Well, that's a good question, and especially you know Tim pointed out, and this is I think probably our most important headline today is the FDA expected to announce a new warning on the J and J COVID vaccine is coming from the Washington Post. Headlines like that make people even more nervous about getting the vaccine. By not getting the vaccine, you can't force somebody to do it, right, It's it's

their choice. But having said that, then for those who do get vaccinated, what do they need to be careful about? Then understanding that there are people still out there that can be hosts and carriers of new variants, and can we who are vaccinated be a carrier of these new variants as well? So less likely if you're fully vaccinated, meaning you can see two doses of either the Visor or more Donna vaccine, you are less likely to be a kill. You're u less likely to get the illness,

not but maybe something percent right, so much higher? Um. I think what people need to think about when they're getting the vaccine today, even when they hear the different news, whether Richard J and J or someone else, is an a mixture that they weigh their own risk, their own health risk to of what COVID would do to them if they actually got it the actual illness itself, and make sure that they also weigh the risk of what it will do to their loved ones because they are

the carrier for the source of transmission to their loved ones in their home, particularly when people live in multi generational homes, there's an increased risk. That's that's that far exceeds in east side effects potential, But the vacuum itself. I understand worries. Well, we have heard stories just in the last minute. Then we're gonna come back with you, um, doctor Meadows. But I'm wondering if you at a Providence Saint Choseph's Health are are requiring people who work there

to get vaccinated. We we don't actually have a vaccine mandate. We have a vaccine policy where we're encouraging our workforce to get the vaccine. If they decline to get the vaccine for whatever reason, then they are actually required to wear a personal protective gear to protect both themselves, the patients and their colleagues at work. Um. This applies to everybody in our health care facilities m both ambiatory acute anywhere that and long term care. Do you anticipate that

could change if these get full FDA approval? I do. I think it's a matter of when it gets full approval. When we're able to get people to really buy in and feel more trust. That small group that's still has itant, we have work to do to encourage them um to make sure they understand what's going on. At the same time, we also need to continue the effort of keeping people that they are treating and care for safe. That responsibility as well. I want to get back to Dr Rohnda Meadows,

president of Health Management at Providence St. Joseph Health. It is one of the largest health care systems in the U S. Was home to the first confirmed COVID case back in early She's still with us on the phone from Wenton Washington, Rent in Washington. Excuse me, hey, Dr Meadows. One thing I want to just follow up on the conversation we were having before the break is that, so what do we there are those individuals who have gotten the vacs seen need to be concerned about worry about

when it comes to those who haven't had it. I think it's more a matter of those who are already vaccinated encouraging those who haven't to get vaccinated, because as long as they are unvaccinated pockets of people there is actually the opportunity for the virus to continue to mutate and spread. Right now with the delta variant, we're looking at something that is more highly transmissible UM, and it is causing the people who are sick in hospitalization for

covid UM. There's also accounting for nine of the death that are occurring. Accounts are increasing. The people who are vaccinated are actually much more protected UM. They're less likely to get ill UM, but with what we don't want them to do is to become carriers. Less likely but still possible. So it's really more about the unvaccinated UM. The people who are vascinated have children are going to be wanting to protect their children if they run as

well on seriod of TALL and can't be vaccinated. If yet, Dr Meadows, I want to talk about something that Carol and I have spoken a lot about on on Bloomberg Business Week Radio, and it's the other crisis that are happening. Well, we are still dealing with this pandemic. There has been a renewed focus on mental health over the last eighteen months because of isolation in the way that the pandemic has affected each and every one of us in different

and diverse ways. And then I'm wondering about community support systems for mental health during crises such as these, What is available and to what extent are are people actually tapping into them? Okay, I think we're going to find UM that what the services that people chapped into during one Most of us knew that we did not have enough clinic or professional base in person fights available for access.

People have availed themselves to virtual online mental health services and group counseling a group chats will need more of those. What I'm expecting, and I think what most of us are expecting is that the increase in depression, substance use, substance abuse UM, anxiety disorders, post traumatic stress type disorders will not have been resolved anytime soon. We can do is actually get the resources increased and available to address them.

And this is not just for adults. I am probably more concerned about children because they again not only have suffered through the pandemic, but disruption of their social starcles, of their education, of their home life UM, and of the social supports that they normally would get if they were in the schools or in community groups and activities.

So this abject is going to be a long term UM challenge that we're going to have to address and if we haven't started enough now we need to get going and whither wise we may find ourselves with a generation of lost children. No, it's a really good point, a really important point, uh, and something we can't just kind of forget as the world gets back to somewhat

of a quote unquote normal status. UM. I do have a question for you though, in your conversations with health care plans, I mean, are things changing in terms of how we think about care wellness care? We have lots of conversations about it, but I do wonder whether or not we're thinking differently about how we all take care of our health generally when we're feeling good, and how

we look about think about maintaining that wellness. And just got about forty seconds here, Okay, we are both on the health plan side and our delivery side, and I think, well, this I'm speaking about Providence is actually across the board and other industry partners that we've been working with UM wellness, prevention, immunization, but also the importance of actually doing integrated care that

includes mental health services. Most places you will see will also have a commitment to health equity, which means addressing the disparities that have been there long term, as well as disparities and COVID. Right now, we have another opportunity right now today to prevent the next wave of a bit illnesses from being desparing right from impacting black and hispatic populations. Worse. Right now, the vaccination rates and these populations are still lower that we want to see them.

They We didn't make some gains, but not enough. We have blocks of work to do, all right, We've got to run um. Thank you so much for your time today. Dr Rhonda Meadows, president of Health Management at Providence St. Joseph's Health, on the phone from Wenton, Washington. The gaps just are still their ten. Yeah. It's it's in a way, it's just mind boggling to think we're so far but yet so far away from actually being done with this pandemic. Yeah, exactly.

This is Bloomberg Business Week with Carol Masser and Bloomberg Quick Takes Tim Stinovic from Bloomberg Radio. Coming up in this week's issue of Bloomberg Business Week a story on how crypto exchanges have a plan to beat finance. It's the exchange that has quietly and rather mysteriously taken the top spot among the world's cryptocurrency exchanges. So unraveling some of the mystery of this very mysterious world in general.

Is Bloomberg News Finance reporter Catch Klinsky. She's on the phone in New York City along with Business Week editor Chill Weber on the remote access line in Brooklyn, and we already had like a really great conversation about everything. We said, again, mind, you know what, what stands out to me the story that Cat is the lead writer on is sort of what this universe of crypto exchanges looks like. And there is a sort of a bad boy actor that is the elephant in the room here,

which is which is binance? Right? Cat? And in order to compete with um finance, what have the competitive landscaped of crypto exchanges chosen to do? For many years now, it's been really hard to compete with Finance. I mean, they list so many coins, you know, they really are you know, they've taken the top spot UM quite easily. And so now we're seeing a lot of exchanges as finance sort of in the cross hairs of a lot

of global regulators and under a lot of scrutiny. We see more exchanges saying, hey, no, we're going to be sort of, you know, the one that follows the rules, and we're going to hope that that strategy long term pays off. Whether it does, I think will be sort of remains to be seen. But you know, I think it's one way that a lot of exchanges now are

trying to plot their own path. Finance, though, doesn't even allow US customers explain what's going on here because there's also Finance am I saying this right, Finance dot US or Finance U S you're correct, and yeah, and they're they're different. They were founded by the you know, same person, and they have licensed some technology in the past, but but they maintain it very separately. And I think that's what you've seen a lot of science changes. I mean, if you look at many of the top ones, a

lot of them don't actually allow US investors. And part of this is sort of district regulatory regime we tend to have in this country, even though you know, crypto obviously is still a newer asset to be regulated. And I think part of that is many many of these exchanges say, we don't you know, We're not going to go through all these hurtles in a constantly changing world. But you see many exchanges like you know, take Gemini

obviously founded by the Winklebox twin. They're really trying to say, no, it's the right path is to enter this you know, this more regulated country and trying and plot a path here. And that's how long term, you know, our strategy is going to pay off. Let's let's talk more about the Winkle v the plural form of the winkle box tins

um and Gemini um cat. So that what they basically say they're doing is like, we know that there will be rules eventually, and so we need to basically get ahead of regulators and and except that there will be rules, right, Um, So how has that worked out for them versus even the other exchanges that are saying something similar? Yeah, So,

I mean that is their strategy. They created the Virtual Commodity Association, which was sort of, you know, essentially to be like kind of almost a self policing share for this industry to think about, how do you actually you know, set up a regulatory theme and an asset that's so knew that many regulators are just trying to get their

heads around. But you know, it hasn't worked out obviously that well yet, and that's because it's being companies like Finance who will list every point, you know, and um maybe are a little less scrutinizing with those. Um we've

seen them jep to the top. And I think you know, but the companies that are trying to follow these regulations are saying now that Finance is under a lot of scrutiny, they're saying, hey, you know, this is this is part of our strategy is to work our way through these you know, regulations, even if they're new, because it is

going to be worth it in the end. Um. But you know, even to Gemini's point, you know, they say, the landscape here in the US moving very slow, so they've got to you know, kind of expand a little more globally to make sure that that they can keep pace right and cut us the exchanges to to something extented doing their own policing right. I mean, there's so many new cryptocurrencies out there, there's thousands, so they've got to kind of weed through and decide which ones actually

get to trade on their exchanges, agreed. And it is actually kind of challenging. You know. We we talked to

someone at Galaxy Digital, Jason Urban. He's there a global cohead of trading, and he said, you know, not only do you have to a figure out how to connect all these coins to the exchange, you have to make sure you have to set up in the technology behind it, but you also have to sort of scrutinize, you know, whether this is an unregistrated unregistrated security and there's not a lot of clarity, so you have to sort of you know, have a lot of legal and compliance teams.

And that's what we've seen over the past you know years, is a lot of these exchanges, such as coin Base, which obviously recently went public, hiring more people to help with compliance and policy and issues like that, which is a whole other issue. If you become a public entity where you're trading, I don't know, I can't get my

head around it. Okay, can we just take a step back here, because I think this is a world that is still unfamiliar to so many people and and really explain people, for people who haven't necessarily bought and sold cryptocurrency, what it is exactly these exchanges do the services they offer. Yeah, so many of them obviously offer range of services, but obviously the big one is they allow you to actually

trade the coins on them. Some of them will offer also offer services such as custody and different um different you know, offerings for institutional clients as well, so any you know, pictured plant touch managers anything like that. Um So. Yeah, so they often have a range of services, but trading

is obviously the big one. You know. They essentially want to have you know, investors who are interested to help kind of beef up the activity on their platform, but they also need to be scrutinizing and make sure that they're you know, not adding coins that are just you know, com completely fraudules. So when when you think about and this is super simplistic, but you have the rules and the exchanges that are buiding by the rules, and maybe the binances that are maybe not as clear how they

stand on it. And then you've got obviously the regulators, and what do we think that the regulators are just going to look at you know, even these homegrown rules, if you will, How are they going to look at that when the time comes? Yeah, I mean I think you know, regulators are trying and We've seen it a lot,

especially with comments from the Biden administration. You know, regulators are trying to really kind of wrap their heads around it, and how do you actually impose sort of a framework on this world, which is you know, meant to be sort of uh a little more, a little more outside you know, the realms of normal, normal finance. Um. So, I think there's going to be a lot of changes probably over the next few years, as regulators start to say, you know, here's what we need from this from this

part of the market. I just feel like there's so many questions gotta figure it out. What do you end up with multiple exchanges? Like, I mean, I think that's exactly right, right, I mean, that's not without uh you know president how it works. I mean, well, one thing that's amazing to me is just how big they become when such a small portion of it's effectively like you

you blinked and it's ntic. Yeah. Well, which is what you were saying before we got started, is think about what happened in the past decade, like what the next decade breaks, I mean exactly right, like ten years of what we've just gone through, and then you think about all the splintering. I'm like thinking of watching Loki just to understand what happens with time. Oh man, that's the best reference the week already. All right, thank you so much,

catch glean Skin and Toolebber. This is Bloomberg Business Week with Carol Masser and Bloomberg Quick Takes Tim Stinovik on Bloomberg Radio. So there have been a flour of headlines out of China's The Chinese government has been cracking down on data security, and the big Chinese companies that collected all on the crossfire DV Global, they warn't today have an adverse impact after complying with the Chinese order to remove twenty five more apps from mobile stories for violations

of data security loss. So much going on, Tim, you and I have been talking about it. We couldn't wait to kind of catch up with Andy Brown. He's been on vacation, but he's here now because we know China is clearly on a mission. And of course, Bloomberg New Economy Editorial director uh in our Interactor Broker's studio, the reason we want to talk to you is you understand China like no other. To be quite honest, you've worked there, lived there Um worked for the Wall Street Journal for

a long time. What what is the mission that China's on right now? What we're seeing right now is for the evidence that the US and Chinese economies decoupling. The relationship is falling apart. We've seen it in the tech space, We've seen it in the internet space, and now we're

starting to see it in capital markets. That China is effectively making it a lot more difficult for its own companies to access US capital markets, which ironically is exactly what two successive US presidents, starting with Donald Trump and continuing now under Joe Biden, have had in mind. It's their agenda too. They have been sanctioning Chinese companies and making it more difficult for US investors to buy into their shares. This extends that what is the motivation? Why

would they do that? Because it seems like they wanted to be a part of the global market scene, right, Well, you know, data isn't certainly right at the heart of it, so Um, But also you know, you have to remember, and this is interesting, and people don't I think acknowledge is nearly enough that the Chinese tech sector was really funded and incubated by Western vcs, Western Private equity UM and China is in a different place now, it's a different era and they really don't need US capital in

the same way as they did. And now they're concerned about control over data. That concerned about it as part of the geopolitical struggle with the United States, and also in terms of economic management. They want the data and control over the data that Chinese tech giants have. I get that that that makes sense, I understand that, But but what does that mean for a company like Disney, or a company like Nike, or a company like Apple,

three very different companies. But the companies that see the Chinese market as really really important and companies that are have products that are gobbled up by Chinese consumers. You know, China wants Chinese data in China, stored in China and subject to you to Chinese regulatory control, which Apple has been able to figure out a way to successfully navigate. The This is this is much more about Chinese companies

going off shore to get foreign investment. But but if if we're indeed seeing a decoupling of these two economies, then wonder about the companies that don't necessarily have data like a Nike for example, or a Disney or is are we going to see a decoupling there? That has to be the risk any US company, any foreign company that has access to Chinese data could find itself as

this decoupling progresses, in a vulnerable position. Over the weekend, we saw a regulation coming out, new rules coming out that says that any Chinese company that has over one Internet company that has over one million subscribers is going to be subject to a cybersecurity review before it can list overseas. That basically accounts for every Internet company in China,

right exactly. That's a small number of users, right, So, Andy, what's the risk of China and all of this or yeah, is there a real risk for them of kind of cutting themselves off? It feels like yeah, I mean, you know, the the risk is that you're going to disincentivize innovation in China. Um. They're going after their tech champions, starting with Ali Baba. You know, Jack ma Uh, the founder, co founder of Ali Baba, was the most public figure in China. You don't hear from him anymore. He's he's

he's he's gone, he's gone to ground. They've effectively silenced him. Ali Baba has lost one third of its market value since the whole business started with the listing of Aunt Financial, which is going to be the biggest Chinese foreign listing in history, and now that's extended now ten cents under pressure. Now Matoine is under under pressure. And these the giants of Chinese innovation. What does it mean for a company

like Bite Dance, the parent company of TikTok. This is a company that Bloomberg has reported that in the private markets it's valued at two and fifty billion dollars right, So so TikTok might well have been one of those companies that was going to go off shore. We don't know quite what its plans were, and now of course this cost doubt about whether it's ever gonna list overseas. Some of these companies, however, might end up in Hong Kong.

The problem there is that actually the hurdle, the regulatory hurdles for listing in Hong Kong and in the mainland are substantially higher than they are in the United States. So you you might get some companies that won't list at all as a result of it. But I don't understand is I feel like, you know, China has been working to be part of kind of the mainstream world right. They want to be innovators. They want to be in the capital markets. They're trying to attack bringing rather the

global financial sector. It feels like they're just turning their back on the world. Are they in essence and will they isolate themselves? And doesn't really matter because they've got a billion plus and they can probably do just find feels like the world is breaking into over tech is breaking into two. You're going to have a China and the Chinese sphere of tech influence and then a US US influenced sphere. The breaking a part of the global economy is one of the greatest risk to global growth

going forward. Well, the rest of the world have to make clear choices about I'm with I'm either with the US or I'm with China. The world doesn't want to have to make those choices. China's neighbors certainly don't want to make those choices, but increasingly it looks like they're going to have to choose. What is alright, twenty seconds left. Don't hate me because I'm jamming you. But what does it mean for investors? Global investors? How they have to

look at this. You know, it doesn't mean that US invests a cut off from investing in Chinese internet companies. You can still invest as an American investor through this tie up between Hong Kong, Shanhai, Shanja and stock exchanges. It does, however, have a pretty big profound impact on the likes of Global Goldman Sachs and Morgan Stanley, who made a lot of money last year out of a very thick pipeline of Chinese listings, and that pipeline is now drying out the I p O market. This is

why we we're waiting for you, Andy Brown. Thank you so much. Good to have you back at a trail director at Bloomberg New Economy here in our studio a journal. Yeah, but you let me drive nor home, Honney. Please, I'll do the right vel. I want to drive. Just drive baby, good question trying. This is the drive to the Globe community. Thanks. We'll dry us to dawn on Bluebird Radio. All right, we've just got about ten and a half minutes left

in today's trading session on a Monday. Let's get to it with Brian Jacobson, multi asset strategist over at Wells Fargo Asset management five nine billion dollars in assets under management on the phone from Milwaukee, Wisconsin, Brian. Nice to have you here with Tim and myself. So when you look at this week, there's a lot going on. There's

economic data. J Powell will be going up before Congress and a couple of days of testimony, and then there's the big bank earnings along with some some other earnings that are coming at. Is it all about the big banks for you? Yeah, thanks for having me on. Um, well, it's probably about the bucks and the playoffs for me or yeah, but you know, it is really about the

bank earnings. Earning season is kicking off, and um, I have worked with Margie Patel, who you've had on the shop or you know, and she taught me a long time ago pay attention to what the banks are saying as far as with the guidance. Uh. And that's I've sort of lived by that and so far it's worked

out pretty well. Uh. You know, if they're saying that the economic recovery is gathering steam, because they really do have the boots on the ground in order to see what's going on with not just you know, big corporate America, but with small and medium sized enterprises and households. They really do have their pulse on the health of the economy and that's what I'm really interested in looking at.

What specifically are you gonna be listening for for for for guidance for commentary on the economy from these executives this week. Brian, Yeah, I'm really hoping to hear about commentary as far as loan demands. You know that banks are ready willing and able to lend, but is the demand therefore it uh? And in the area of that you are you talking financial business? What are you talking specifically with London and mainly with small businesses as far

as their willingness to take out loans to expand. So it really is looking at the small business lending because so far, if you look at what banks have done effectively is originate loans that are guaranteed by the government. And what we'd like to see is more the risk taking holding it on their own balance sheets with the banks,

which can also be a higher profit margin loans. And that's one of the reasons why we're actually overweight financials and more cyclical areas and a lot of our portfolios on my team is because we do think that is going to begin to happen, and so we're hoping to see confirming evidence of it. So you would be taking position and ahead of the results the quarterly results on some of these big banks. They're they're up today and there there are top performing major industry group in the

S and P five hundreds, the big banks. Uh, you're seeing some significant gains here and really providing momentum for the overall trade. Would you be taking positions ahead of those results? Oh? Well, that is how we have been positioning portfolios and anticipation of it. Yes, And so you know, we were overweight cyclical areas like industrials, Uh, but we've sort of rotated a little bit more into uh, like

the financials and materials getting more exploicure like that. But a lot of it is also rotating more towards Europe and emerging markets, where we think that you know, there are a bellow a season behind us in terms of with the vaccination rollout and the economic recovery, and so we think that they might be a season behind us

in terms of the market moves. Hey, how weird are you about in terms of some of the headlines we're getting out of China specifically when it comes to their growth rates and tempering back some of the growth that we've seen China so crucial to overall global growth. Should we be nervous as investors when we start to see some of the growth numbers in China start to be

reined in. We we've seen China also doing taking steps to Chinese government and the Chinese financial system to kind of help juice their economic growth because they too are seeing the slowdown. Oh, they are seeing that slowdown. Yeah, coming out of the COVID recovery. You know, they were the they were the first ones in and then they were the first ones out. It was mainly led by

manufacturing and then by on the retail side. And it doesn't seem like the retail getting a massive amount of traction. And so I think that it does merit monitoring what's going on with the Chinese growth numbers. But you know, they do seem to want to almost play with the throttle a little bit. And the most recent one is as far as reducing reserve requirements for banks in order

to stimulate the lending um. So they I think that it does merit monitoring, but we're not too worried about them having any sort of like hard landing or anything of those sorts, because, Uh, you know, thus far are while the growth camp slowed, it's still a pretty aggressive growth rate that we're seeing coming out of China. Brian, what about you know later in the this is a very busy weeks. Carol mentioned a ton of economic data.

We have bank earnings. I'm also fed Chair Powell heading to Capitol Hill, Uh, for two days of testimony about the economy, about monetary policy. Uh, what are you watching for there? Do you think that we've seen Powell in the past, he's been very restrained when when like many fed chairs of of of past, when it comes to answering questions, do you expect anything different than we saw in in minutes? Do you expect anything different than we

saw at a press conference. Yeah, it's almost like we see them every week, sometimes every day, and so it's you know, what changes from one moment to the next. But I think that with Chair Poll's testimony, Um, he might want to start slow walking things towards tapering. Right, we know that they didn't want to slow walk. I

think it's a crawl. Brian. Now, yeah, it's more like this a glacial past towards the tapering, and I think that's maybe what we're going to see in his testimony is that, hey, you know what, the inflation data is a little bit stronger than we thought, but the growth numbers are stronger than we thought. We still have plenty of room in order to um, you know, before we get to having inflation being a problem. We have plenty

of tools to deal with this does. And so, yeah, we're having the conversation about tapering, and so I think that maybe he'll mention that a few more times. So before it was like, you know, not even on the table, and now it's become a centerpiece of the conversation of the members of the fm C, and so we'll probably

just hear a little bit more about that during his testimony. Uh. In terms of things to be concerned about, there's always a list out there, and we keep trying to assess the risks of you know, the variants that are coming out with the virus and what that could mean for the economy. Tim and I be talking to a bunch of CEOs this week in different sectors, the cruise industry and industrials. How do you factor in sess strategize around what might come next when it comes to COVID. Yeah,

for us, it's more about a sentiment at the moment. Right. A big part of the moves and the markets has been about the anticipation of the economic recovery, and we're beginning to see evidence of that of those things that the market was anticipating. UM. And while we have gone past the what we think we have gone past the peak inflationary fears, we may have also gone past the peak optimism fears or the peak optimism about growth. Right.

So you had peak inflation fears coupled with peak growth optimism, and that created an environment with yields rising. Equity still consntinuing the charge ahead. But if sentiment is beginning to shift towards you know, is this as good as it gets um, that's where it could create some more headwinds for the equity markets until maybe we see the labor market significantly improved, which we don't think we're going to see more signs of that, definitive signs of it until

probably the fourth quarter of this year. So we're actually preparing ourselves more to be a little bit more neutral in terms of positioning um and to anticipate some volatility through the summer months here, but setting us up for probably a pretty decent fourth quarter. It's the master sell off, That's what we call it, because every time I go away in August, the last few summers, the last few years, you know, kind of pre COVID, we would always get

a pretty decent sell off. You know, we thought it was because it's my birthday. All right, it's the Brian Jacobson birthday sell off. It's gonna go by Multiple News. All right, listen, Brian, Thank you so much. Brian Jacobson, multi assets strategist over at Wells Fargo asset Management, billion in assets under management, on the phone from Milwaukee. 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 Easter In on Bloomberg Radio or watch us on YouTube search Bloomberg Global News m