Inequality of the Coronavirus Outbreak

Business Week on iTunes, soundclad bl Bloomberg dot com. You can also listen to our radio show at two pm Eastern on Bloomberg Radio every weekday, or watch us on YouTube by searching Bloomberg Global News. The virus clearly, UH continues to be front of mine, and yet I feel like we're looking at it, maybe in a more complicated way and a more complex way, not in a bad way.

Candid League, Carol, and this next guest has always kept us on us when we've talked to him about some of the demographic, the socio economic elements of this that we cannot forget right and I feel like it's been exacerbated. Are reminded even more because of the last couple of weeks, Um, the black community right again impacted disproportionately. Um, when it comes to certainly the virus, we saw that, and then equality and justice. So perfect voice for us on this Monday.

Welcome back Dr Sandro Gillia. He's dean and professor at Boston University School of Public Health and his author pained uncomfortable conversations about the public's health. Conversations though that need to be had, he joins us once again on the phone from Boston. Dr Gilia, Nice to have you back with us. UM. I do wonder, both Jason and I do wonder how you're thinking has continued to evolve because of what's happened, not only in the past thirteen weeks,

because of the virus. We've talked to you about that, but then what's happened in the past two weeks, what we've seen out of Minneapolis. You know, first of all, thank you for having me always. I think what we're seeing coming out of Minneapolis is an expression of justifiable, entirely understandable anger and frustration with decades and centuries long injustices, and that I think is reflected in the protest we

have seen around police around policing and around systemic racism. Now, when you think about that one question, you might ask, well, what does it have to do with COVID, What does it at the moment we've been living through. But I would argue that these underlying structural forces that divide us, that divide us on racial ethnic lines, that divide us on social class lines, also are the story of COVID. COVID was a virus that early on said world virus

effect everybody. Sure it does, but it doesn't affect everybody equally. We know now that the greater burden of COVID infections disproportionately falls on minorities, on people of color. We know that among those who are infected, the greater proportion of death, a great egshbit of death falls on people of color and people who are socio economically marginalized. And that reflects

this underlying division that shape and colors our society. And those are really the same forces that we are now seeing flare up in uh in this anger that emerged obviously from the George Floyd killing and the other killings around it. So we do have here commonalities. We have essentially a pandemic unemployment, civil unrest, all of which is reflecting underlying deep racial and socio economic device and so Dr Ghalia, how do we go about solving this structurally

from a health perspective? Because all of these things, and I think you've pointed this out to us before rightly, are all intertwined. Whether it's health, education, transportation, housing, all of it is tied together. But just taking health and your specialty and public health specifically, what are the ways that that maybe we can be thinking about, uh, to

start to change the structure of this. Yeah, I think, uh, it thinks a great question, and I think it's a it's a natural question, and I sup pose I would invert the question because I don't. I do not think you can treat this just as a health problem. Interesting, I think that health is ineluctably linked with housing, with fair, fair wages, with gender equity, with clean air, drinkable water,

with the way we structure our society overall. And this is why health and social justice are so inextricably intertwined, because there is no solution that focuses only on health. If we focus only on health, what ends up happening is we end up borrowing and borrowing more, ever more, deeply in spending money on healthcare, and of course, spending money on healthcare as as you know, as the listeners know,

is fleeting disease after people are already sick. But of course people are getting sick to begin with because of these underlying issues. And let's take let's take one complete example. Let's take the economic collapse that has happened after a COVID we all, we all notice you talk about it

quite a bit in your show. But of course the economic collapse has been uneven t thirty six million jobs have been lost so far in where health of the jobs lost were helped by people who are already had an animal alsehold income of below the unemployment rate among white's fourteen percent, among black seventeen percent among Latin X populations. So what we're seeing here is even in something like this, which is an economic collapse which is widespread, which you

report correctly has been widespread, is furthering these divides. And these are the social divides that are going to become health divide. So let's take for a second, let's let's assume let's agree that unemployment results in bad health. That's that's not a controversial. That's not a comrevercial statement, right, So I'm telling unemployment results in bad health. I'm also telling you that unemployment is this proportion and among people

who are already poorer than people who are richer. So it doesn't take a sort of too many logical steps to realize that that means that people who are poorer are going to get sicker, people who are richer are going to get healthier. Now, if we focused on that as a strictly health problem, we are going to be throwing money at healthcare to help fix people who have

gotten sick. Well, the problem, the reason they got six to begin with is because they were already economically marginalized and because they became unemployed in a time of COVID. So when you see it that way, the two are inextricable. And I think a health agenda has to include an economic agenda. I totally agree. God, we were talking about this a lot over the weekend, about what it is

to those that are more vulnerable and economically disadvantaged. What do we need to do to really make a difference with Our guest at this hour is Dr Sandro Galia. Galia. He is dean and professor at Boston University School of Public Health author pained uncomfortable conversations about the public's health. Dr Galia, One thing I want to ask you, since we you know, we know so much is interconnected in terms of, you know, really determining what kind of life

an individual in America has. So, what do you think is the most important difficult conversation that we have to have at this point? Is it over housing? Is it transportation? Is it wages? Is it taxation? Is it health? What the one that we need to have to kind of make a difference to the less fortunate populations, and specifically since we've talked about it a lot over the last couple of weeks and certainly the last thirteen weeks, the black population. Yeah, I think that's a that's a terrific

question and one I must all the time. And is it a conversation about making sure everybody has access to quality early childhood education, is a conversation about fair wages and increasing knowledge? Is it the convertation about affordable housing ensuring that everybody there's this food about narrowing wealth gaps or redating violence of infginalized groups SPD groups. And the answer is I don't know any of these important and others. I have to think the hardest conversation is the one

we're having now. We just to say that all of these conversations are important. You know, which of the conversations become policy solutions depends as much on the connotation as it does on the pragmatics of the moment as to on what is possible in what jurisdiction. So as not un concerned. If there is one thing that we should do, it's to change the conversation and to say that all of these are forces that we should discuss in the

same breath as we discuss health. And when you think about COVID and ask myself, you know, what should we look back on COVID in ten years time, what's the conversation that we should remember. What I'd like us to remember is that COVID taught us if you cannot help have a healthy country without better education, transportation, wages, housing, food, narrowing wealthcaps, reducing violence, better integration of marginalized groups. Because all of those forces we have seen play out in

creating the COVID pandemic that we've lived through. So if we learn from that, if we learn from that, we will tackle them and tackle them now. And you know, I do wonder, Dr Galia. Part of this is educating maybe the next generation, whether it's the next generation of doctors or just the next generation writ large, sort of a different way or to think in a different way,

and that seems to be coming up repeatedly. And I think many of us are buoyed by the fact that a lot of the people protesting peacefully are of many different races and colors and backgrounds. Um. I do wonder what the conversations are that you're having with your students and how they might be different from a previous generation. Yeah, I I like you by by thinking about the next generation. One of the privileges of being a dean of the

school that I'm surrounded by the next generation. I all of these conversations are happening with our students, but perhaps most importantly, our students are leading the appreciations because I actually think that the generation that is up and coming that will be in charge of the world in next

into years as some interesting ideas. And I don't think all of the ideous work I think somebody with somebody disagree with, but I think it's UM It's a tremendously important moment in time to allow ideast by space as we can which sift forward, which once we can adopt m to use. I think something Carol said before the break, how we can make sure we actually implement the transformations to implement without and making sure that people are not hurt in the process and that and that of course

is critical. So I've been I've been enjoying listening and learning from all the ideas emerging from the next generation. And of course it's immensely hopeful to think that some of these concepts that the three of us are discussing their sort of second nature to the generation, and that will make the world a better place. I was thinking about, I know, Jason, you do this at your home with

your teenagers and my teenager. To like the way they talk about this and approach it gives me hope, I have to say, in terms of totally you know the possibility of making a difference and looking at it in a different way. UM, thank you so much. Dr Sandrow Galileo galia He is dean and professor at Boston University School of Public Health. Author pained uncomfortable conversations about the public's health. And he's so patient because every time I say his name, I seem to just mess it up.

I mean, he's just such a jam, new and different. I know, I feel so terrible because I he's one of my favorite voices to talk to, because I feel like he looks at the world. It's not just healthcare, but it's taking everything into account and how do you make a difference. Maybe in all of our show calls, will just say, all right, let's say it again. Sandro Gallea, Sandra Gallea, I think it's Sandro Sandro Gallea. You're listening to Bloomberg Business Week with Carol Masser and Jason Kelly

on Bloomberg Radio. One of the issues that we have been looking at so closely, Carol is what happens next and how we got here? And this true from the magazine last week, I think is a really important and I'm really glad Joel Webber and I were talking about this earlier that we're getting a chance to talk about it. Clearance Souneth wrote it, uh and the story has a very simple headline, America's safety net is failing. It's workers. Claire Jones is on the phone from Brooklyn. Joel Webber

is also with us, the aforementioned Joel Webber. He is the editor, of course, of Bloomberg Business Week. So Joel help us under dand how this fits into what was clearly a broader theme in the magazine and the most recent issue of the magazine. So Claire actually started working on this story basically right at the very beginning of the pandemic. And I think she really, uh, she's just like one of the most gifted storytellers I think we have.

And really, I think she was like a laser on putting um the you know, the spotlight on on workers, and one after the next that she talked to, she was just getting amazing stuff about them, basically realizing how there was no more safety net in this country because it's basically just been eroded over time. So when something like the pandemic hits, everything is overwhelmed and as a result,

the labor market just goes upside down. And frankly, even despite Friday being what those numbers were, it still feels like we still don't understand entirely what's going on. And I think clear reporting to me, of everything I've read so far, was the one That just made me really understand it on a more human level. Clear what did you how did you find these people and what did you hear from them? Um, that is a great question.

I found him a number of ways. Um. I mean part of this is this whole story, given the pandemic had to be reported remotely. UM. So normally I tried to go out and talk to people, but here I basically utilized the Internet. I put out a column pretty much all social media that I could, and then I also just reached out to random small business owners. UM. I read something small in the paper about cheesecake factory employees being furloughed and that they had formed a Spacebook group.

So I talked my way into the Facebook group and ended up talking to all these cheesecake factory employees. So there's an anecdote about them and there. Um. And it was just a lot of I would refer to it as on the ground reporting, except it's more like on the internet reporting. Um. Yeah. And I tried to talk to people all over the country. So there are people from you know, Virginia to Chicago, to California, to Montana,

to New Mexico to Texas in the story. Um, to paint a pretty wide picture of what it looks like across America as a whole, and everybody I learned, so I did. I started reporting this before the Cares Act passed. UM. So the thing that struck me first as people were getting laid off during the shutdown the initial couple of first weeks in March was that, UM, given the past work that I have done on stuff similar to this, I just knew that there wasn't anything available for a

lot of people. And many people have extreme debt um or their health care is tied to their jobs, or they don't have health care at all, and so I wanted to see what this looks like when you suddenly are laid off of work UM, with no opportunity really to get another job. I think what was different with this pandemic is if you're laid off in a recession, its docks and it's terrible, but you can look for

other jobs. But if you're if you're a restaurant worker in your restaurant closes, you can't go to another restaurant, so you had to sit tight UM. And so I watched as these people went from having UM no safety net whatsoever, the very first people in this story happened to be working. They were freelance workers, and they happened to be working the first sporting event in the US that was shut down on March eight, and they had nothing. They had, Um, they paid for their own health insurance,

they didn't have you know, any unemployment. They didn't qualify the CARES actual later changed that, but it took them a month plus to actually get up, you know, through the unemployment system, which is you know, it has its own issues. And so I started talking to them before they could even apply for unemployment and thought they had

to do this all on their own. And then this act gets passed and then they feel better, and then it turns out that they have to wait for their unemployment and then it's not what they thought it was going to be. You know, one of them didn't even get anything until just a couple of weeks ago. Um, and they have been laid off since March. So that's basically the story of why we didn't have the set up in the first place. And then, um, what a cluster mess it is to try to build a safety

net in the middle of a pandemic. Right Well, you know what's first of all. I love that you tell the personal stories because I feel like sometimes we talked from that big perspective, the big broad numbers, But when you really hear about, you know, the struggles that so many Americans are going through as a result of this, it's really very telling. The thing is, what's interesting, Claire too about your story is the destruction of the middle class. Right.

You know, we see people pointing like, you've got to have a safety neft net, But how can you have a safety net when we really destroyed I feel like that opportunity for so many Americans. Yeah, you know, I talked to people in all different levels of UM what I would I guess refer to as you know, economic and financial security and UM. You know, there's a woman in the story who was a senior marketing manager at Airbnb. Like, she made good money, she worked for a big company. UM,

she's getting severance through UM July. UM. But the thing is that she lives in the Bay Area and she had, you know, had I think it was about forty five thousand dollars in personal debt, and she can't afford to stay in the Bay Area if she can't find another job, and she's not sure that she's going to be able to do that before her severance ends, um, which is you know, she's like maybe a month to go before, you know, and she doesn't have a job, and so

her option is essentially she's forty years old and she's originally from New Jersey, and so she said, I'm just going to move home to New Jersey and live with my mom. Um. And this is a woman who's you know, well advanced in her career, is doing well in all other respects. But um, just the nature of life and

how expensive it is the middle class. I talked to several economists to study this and study wealth disparity, and one of the things, um um, Edward Wolfe at m Y you mentioned that he's been setting this for so long. In the nineteen eighties, your average middle class family had enough financial reserves and savings to get through two to three months of just sort of normal consumption. If they hold tight, they lose their jobs. And now it's a

little bit over a week nothing. Yeah, that's really remarkable. Well, uh, it is. They must read for sure. It was one of the most rehead when it published last week, and certainly this full issue of the magazine is one to really sit with and kind of take it in because I think we all need that gut check and that reality check about what the statistics, the data and the personal stories. And you pointed that out, Carroll, really show.

But I also think of the conversation we have with Dr galayap right about all of this so interconnected, and we've got to if we're going to solve some of these problems, folks, we have to look at all of it, education, housing, wages, so much so our thanks to Claire Saideth check out that story in the magazine. Of course, I think so always. To Bloomberg Business Week editor Joe Webber, you're listening to Bloomberg Business Week with Carol Masser and Jason Kelly on

Bloomberg Radio. All right, you are listening to Bloomberg Business Week. It is Monday. I'm Carol Masser along with my co host Jason Kelly. So, Jason, it is so true. My family is another description of it too at her at home, but we'll talk about that later. Um, Jason, let's not forget. We've got a FED meeting this Wednesday, so it's gonna be very interesting. If you think about Friday's jobs report, I'm so curious what the Fed has to say in

today's Business Week economics. UM. So delighted to have back with us Stephen Skanky. He's chief economic advisor at keel Point. Former US Treasury uh UM US former sorry, former U S Treasury and White House National Security Council staff member. It's terrible when I can't even read my own notes. Based in Washington, d C. He's on the phone in the nation's capital. Um, Steven, so great to have you back with us. UM. So much going on as well,

and I do wonder, first of all, how is your world? Well, thanks, Carol. Always great to be with you and Jason. Our our world is increasingly complicated, just because there's so much going on all the time. But I'd say generally, well, we feel good about what we're seeing and about how markets are responding. Some of it is is a little bit hard to fathom when markets are up on days that we have negative news, but clearly they've they've learned to look forward to what's coming and not what's in the

rear view mirror. Yeah, I mean, it is sort of remarkable to to see this and to continue to try and synthesize sort of well street main street data, market sentiment and all that. So, Stephen, if you're sitting at the FED, you know, sitting around that virgin at that zoom meeting with which I assume is how they're doing everything, like we all are um with j Pollack, what's the tone of the meeting? What are you looking at more acutely or more specifically, and and how does the conversation go.

They certainly have to be happy with how things are developing and how what they've done already, which was proactive, preemptive, uh and done very effectively. They've got to be very satisfied with that, notwithstanding the other things that are going on in the economy and public health. But they've really

done their part, and they've done it well. Uh So, so as they see where they've they've made sure that there's enough liquidity, they've backstopped critical credit markets, they've done what they can on easy monetary policy and buying longer term asset, and so now let's to figure out where the fine tuning has to happen. You know, so far off there are eleven emergency credit facilities, they've only implemented

three of them. It looks like they're getting ready to roll out main street lending, UH, which can have a huge impact. It's it's potential is up to billion, and that will be significant when that gets rolling. So so they're they're looking at what needs to be done next and what fine tuning needs to be done with what they've done already. So fine tuning what I'm curious And you understand, um, Steve, how it all works right? Having you know, worked at the treasure, you understand, um, the

workings of all of this. How does something like the last two weeks fit into potentially a FED discussion. I bring it up because Alan Greenspan used to talk a lot about the broader society and inequalities and so on and so forth, and just kind of looking at things. So I just do wonder does the FED think about policy and how it either helps or hurts kind of some of the gaps that are in our society. They think about it a lot and pay good attention to it.

That is the one that generates income and wealth disparity numbers to make sure that it's well distributed publicly and that policymakers are aware of it, and they and they do it in a very a politic call UH. Almost academic way. So the data is trustworthy, it's transparent, it's widely circulated, and they talk about it. Uh. Nothing is uh nothing is sort of kept in the background because it comes from the FED. It's it's right there with

the highest level of credibility. J. Powell has also been very proactive, as you've probably heard him say, being out in town meetings and meeting with minority communities and those parts of our society that have have not done as well over time as some of the others. And they were very pleased to see historic progress made in in income levels with some of the historically less privileged minority areas.

And of course one of the one of the tragedies among many within the minority communities right now is a lot of that is rolling back because of course, uh, that's where many of the joblessness numbers have come from. First. So Stephen, before we let you go, I just gotta ask you, because we are thinking so much about reopening, uh, even cautiously here in the Tri state area in New York City specifically, what's the most important data to look at when it comes to reopening. It's even from a

national or or a regional perspective. In your estimation, probably the most important data to keep an eye on is the is the public health data, because at the end of the day, UH, people will individuals will only be comfortable going back to work and being fully productive and being out as active consumers again if they feel safe, if they believe that that the government, society, workplace, our state and local governments in particular, are are paying attention

to the environment in which they work in shop, that personal protective equipment is available, that testing and contract contact tracing is being done efficiently. Uh. And of course everyone is paying attention to the latest news on the vaccines and therapeutics and and that been a big market driver over the last month. So we are paying attention to what's happening in the public health area and believe that that will be the principal driver ultimately for how quickly

the recovery happens. Right, the ultimate oversight right in our expectations about it and what we kind of expect our leaders in society to take care of us. I'm Steven, always thoughtful and really appreciate your time. Steve Skanky, Chief Economic Advisory kill Point, former U S. Treasury and White House National Security Council staff member joining us. Jason once again on the phone from Washington, d C. You're listening to Bloomberg Business Week with Carol Masser and Jason Kelly

on Bloomberg Radio. Well, now, as we try to do most weeks, sometimes multiple times a week because we just need his insights that much, let's turn to Andy Brown, Bloomberg New Economy Editorial Director. Uh, he's got a provocative column. Maybe not so provocative these days, given everything and how everything is up. I doubt another lost decade is coming in. Dejoins on the phone from New Hampshire. Alright, break it

down for us. A B. What are you seeing? Yeah, so we've you know, the the the epicenter of the coronavirus is now shifted to Latin America, and so the New economy we're really focused now on what is going to be the fallout on the world developing countries. And

you know, what we're seeing is the good news. If you can talk about good news and an epidemic, maybe it's best to say that the less bad news is that the most dire predictions are the economists and epidemiologists um about the impact that this was going to have on the developing world just hasn't actually come to pass UM.

And that's particularly true in Africa, where the United Nations just a few weeks ago I was talking about potentially more than a billion infections and three more than three million deaths and multiple famines of biblical proportions and and really sort of um creating these and of the world scenarios.

And that hasn't that hasn't happened. UM. It's also I mean, right now Africa, you know, according to John's Hopkins University, which is wasn't you know, some of the most reliable data that we have that there's only been a hundred and fifty thousand infections in the whole of Africa. Of course, that's lowballing the the total because Africa hasn't had widespread testing. UM. The The other sort of piece of good news, I guess is that you know, it's it's actually emerging economies

that are leading the global uh economic recovery UM. And and the countries that are performing best are the ones that have been most competent at dealing with COVID nineteen. And that's been you know, by and large countries in East Asia, led by China, South Korea UM and tai one, which was of course and an exemplar. So that's kind of on the on the positive side in a sense of of the balance. UM. You know, the that the bad news is that this this this epidemic is going

to dramatically widen global inequality. You know, the rich countries of the world have been able to you know, spend literally trillions of dollars on on stimulus, plugging income gaps but workers, plugging revenue shortfalls for companies, and you know, countries in Latin American Africa simply haven't been able to do that. And to the extent that they can UM borrow now to UM you know, to support their economies,

they're having to do it at higher interest rates. So now they have this additional burden of debt UM you know, on top of plunging currencies, on top of failing trade UM. And that's not before we even get into sort of these other issues around long term issues of of climate change.

So you know, they net net outcome UM is that you're going to have a much deeper uh divide in in in the global economy between the haves and the have nots, and then even between emerging economies between those in Africa, Latin America and then the economies of East Asia of course, which which you're going to going to be come out of this pretty well. So you know, you are really knocking back development in large parts of the world by many, many years. Well, this is you know, Andy,

what I love about your story. It's like if you were scientists and you were going looking at a cell and you keep going through, you know, smaller and smaller layers, and I feel like that's what you do in terms of the viruses impact on the world. Right, differences among developed nations, then you have developers, is developing, and then the more you break it down, there's differences even in

the developing markets. You though, go as far to say another lost decade is coming for emerging market How how do you anticipate that that might play out? Then well, if you if you look, you know, we had a Bloomberg story UM today by our Bloomberg's economics team. They're talking about the Brazilian economy shrinking by six percent is um you know other some of the other major economies in Latin America, Peru, Mexico are predicted to shrink by

similar amounts. So you could say, actually, right off the bat, we've got a decade of of of lost growth there um. But for many of these countries, you know, they now they don't have the resources to invest in social infrastructure, in in education, in healthcare. Everybody's talking about, you know, the the the the necessity of investing in the digital economy coming out of this. That this is going to be um you know, and and an area where all countries are going to have to uh, you know, pour

their resources as well. You know, Latin America, Africa just doesn't have the don't in the countries, they don't have the capacity to do that. So hence this you know there there are something like don Besa Moyo. She was on our newer Car to Me a Conversation series the other day. She says, what we need for Africa is a martiall plan and not going to be able to

dig their way out of this on their own. They need they need massive infusions of capital, um, you know, from from the United States, from Europe, just as just as you had this US effort to rebuild Europe after the World War Two. It's another thoughtful piece and you also do wonder about you know where we need China may be and all of this, they have spent so much money on the emerging areas um before interne of tapping resources but then also providing money for those areas.

So you do wonder um where they should what their role should be going forward. Another provocative piece and thoughtful piece by Andy Brown, editorial director. Andy thank you Bloomberg New Economy on the phone from New Hampshire. All Right, you're listening to Bloomberg Business Week cal Master along with Jason Kelly, and we're just about twelve minutes away from the closing bell on this Monday, and we continue to see, as you just heard from Charlie Pellett, that rally continuing.

In fact, we're just covering pretty much off our highs of the session, but nonetheless stocks continuing to grind Highermzing it is time, I know, I don't I mean, I still I don't know. Well, I feel like disconnect between broader world and the markets, but I also feel like it's indicative of who is in the financial markets, who's investing, versus kind of the rest of the world and some of what ails us in certainly a large part of our society Jason absolutely. All right, Well, let's get to

the Drive to the Close today with Mike Chalker. He is portfolio manager senior analyst at LM Capital Group, looking after about four billion dollars journing us on the phone from San Diego. All right, So Mike, we're scratching our heads as as we continue to at this market that grinds higher. You just heard Charlie Pett break down the numbers and Carol referenced them as well. What do you make of this market? What do you see in the market, and how do you account for what we see in

quote unquote the real world and the real economy. Very good afternoon, guys, Thanks for having me. Yeah, you know, it really is been of a and under for some UM. For other example, the answer is fairly simple, and that would be the Federal Reserve. You know, it is really the market maker ever since it announced the accident, wanted to take back in March, and our feeling and the firm is that and the fixed thing comes side at least, and and it's been echoing over to the equity side.

You're having a lot of market participants try to front run UM the FEDS participation, and so if you feel like you can get in the securities and the risk that you're comfortable taking, and then maybe later selves at a higher price. When the FED steps into the market, which you know it's only just beginning to do so with its primary and secondary credit facilities, then that's a

great big uh. You know, then we'll continue to maybe step take a step back after that point and really see if the economy can now mimic the v recovery that the market to that. Yeah, that's interesting and I

do feel like, um a million questions here. First of all, let me ask you, since it is a FED week, we have a FED meeting, do you expect the FED to continue to be really supportive or do you think, based on that Friday's jobs report last Friday, that they're going to maybe start to say, well, you know, we can start to back off. I mean, we've seen the back off in terms of asset purchases, but I do wonder if you think they will say more on that front.

I don't think they will. Um, it was interesting to see them back off the asset purchases. I was a little bit premature, I'm gon our view from them. I thought they would be a little bit more supportive. The job's number on Friday, of course, was a rocket number. I'm surprised almost everyone on the street, including us, But it does make a little bit of sense. As we're

beginning to reopen the economy. All these restaurants, all these small businesses that did have to lay off workers, well now they're in a rush right there, in a rush to bring back as much employees as they need to sufficiently stay open. Now the question is did they get them all once? I'll swoop did they just quickly bring everybody back? And this is you know, maybe thirty or of their employee rates that they had they mentioned that

they had before we went to COVID. And then the question remains for the rest of the economics recovery, Well, how many jobs are going to be permanently lost, because there will be a significant number there will be four or five, six, seven million, who knows number of jobs that will not return. So how do you put money to work at a time like this? And there are certain sectors that feel a little bit better as you synthesize all of that, and presumably, uh, it might gives

you look at a a reopening economy. We're obviously laser focused on it here on the East Coast and especially being in and around New York City and sort of what that looks like and how much that will influence not just investor sentiment, but ultimately earnings and economic behavior. Right, So we've done a couple of things. Um, obviously, you know, there's been an incredible rotation on an incredible spread compression

on the credit side. And if for a minute, we can just step back and talk about where rates are right now, right, so the belly and the early part of the curve, or excuse me, the front part of the curve two and three year paper being a you know, low to mid twenty basis points doesn't really entice anybody on the treasury side. You're not gonna have anybody continue to think, oh, let's go ahead and buy treasuries because we can pick up twenty six basis points. Um. The

risk there, the risk reward didn't didn't worked it. So a lot of what we've been doing is taking some of that allegation moving into a credit name that we like in particularly as you've seen in the last week or last two weeks, the incredible steepening that's gone on in the treasury curve. I think that's exactly the momentum in the move that the FED wants to see, whether

they'll say it or admit it or not. I believe there is some type of yield curve control that is happening um, probably inadvertently, but it's working out to their favor. They want rates low, but they want a steeper curve um. And so for us, a great place to be is in the financial banking sector, which we've been overweight for a good part of a year, if not more. I mean, we're continuing to add to those names some people that have been chasing the beaten down names like energies and

cruises and the airlines. We think that will end up rotating out and just further the trade moving into finance.

And thanks as well, Hey Mike, before we go. I am curious though, when you look at some of the current events that are going on in our world, whether it's the virus, whether it's the last couple of weeks from Minneapolis, and you know, once again we're talking about the gaps in our society and the people who are being left behind once again, and I do wonder how you look at it with an investment I and I do wonder if you think about maybe some of the changes that need to come about, um and and and

how investors specifically can really vote with where they put their investment dollars. Well, it's really tough. I mean, that's a really tough question. It's a really tough topic. Um. You know, I was watching a segment today about how E s G has really become part of the forefront and a lot of investor is mind and particularly what's what's happened in the past couple of days. Um, you know, I'd really like to see that sort of explained, right.

And then not just environmental, social, and governance, but you know, particularly into the social aspect. You get a lot of people that are really concerned about their environmental exposure and you know, not being in the coal producers and such. But you know, I think what's going on in the past week or so, it really brings up to the

forefront more of the social and the social injustices. And as a money manager, it's really tough to see what we think of you know, the top tier percent of the people to make up our economy continue to succeeded, Asset prices rise, knowing that there is a large group of people that aren't able to participate in this because of their socioeconomic factors and they're kind of left behind. Um So I think really that further further the divide in our country. And and like I said, as a manager,

it is sort of a tough thing to watch. But of course, you know, our our our duty is to make our clients money. But um I really, I really do feel that there is some some more that needs to be done on the E s G side and frankly on the policy side. But yeah, that's a that's the topic that we we don't hand that we only kind of try to keep watching. All right, Well, good to catch up with you. Thanks for the insights. Mike Tarker is portfolio manager and senior analysts for LM Capital

Group on the phone from San Diego. Thanks so much for listening to Bloomberg Business Week. Download the podcast on iTunes, South Cloud, Blomberg dot com, or wherever you get your podcasts. And of course you can always listen to our radio show at two pm Eastern on Bloomberg Radio or watch us on YouTube by searching Bloomberg Global News