Not Clear That Regeneron Is Helpful, Toner Says

Week on iTunes, SoundCloud, 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. Let's get into the virus. Understand where we are. It is a fast moving story, to say the least, things changing minute to minute and certainly day by day. We're lucky to have with this. Dr Eric Turner. He is a senior scholar at the Johns Hopkins Center for Health Security at the Bloomberg School

of Public Health. Of course to Johns Hopkins Bloomberg School of Public Health, you can probably guess by the name. It's supported by Mike Bloomberg. He is the founder of Bloomberg Philanthropies as well as Bloombergilpie, the parent of this radio station, and Dr Turner joins us on the phone. So, Dr Turner, what's the most important thing we need to know about the virus today? Well, I think the most important thing we need to know is that RUSS isn't

going away. Um, more than half the safe states are seeing increasing cases. And um, you know, it's still in every state and still in every country, so it's not going anywhere. We will be continuing to live with this for quite some time. Is there anything though about the progression?

Like I was saying early at the top of our broadcast, Dr Turner, that I was watching kind of I was watching the evening news programs and they were talking about the hotspot now that is was Wisconsin, Uh, and getting towards you know, some really um tough situations right now of running out of space and hospitals essentially where we

were several months ago. Can you see anything though, as we continue to move further and further into this pandemic that we are learning, we are learning how to treat it, we are learning how to quickly get hot spots under control or yes, and no, Well, we know how to get hot hot spots under control. We've done it now multiple times. Uh. It requires that people adhere to the same guidance that we've been giving them for months, which is need to wear masks, you need to maintain distance,

you need to avoid indoor crowded spaces. Uh, you need to be tested, we need to contact trace. Um. All those things are still true and they all still work. UM. It's it's when people don't adhere to the to that guidance that we see these outbreaks. These outbreaks don't happen randomly. That happen because people aren't adhering, um to what we know works. So wait, all right, you kind of gave us a softball there in terms of setting up what happened over the last week. In terms of the President

and the White House. I feel like all those things you said, from mass to social distancing to avoiding closed spaces, like it was like a checklist of everything the White House did wrong. Yes, yes, I mean it. You know, the science is clear, the messages have been clear. We you know, we know they've worked in every location, not only in this country but around the world. UM. And the White House's refusal to follow their own government's advice has led to this super spreading event that's been um,

you know, surrounding the president. And so once we saw the president diagnosed, and we saw him go to Walter Read and and I'll set aside for a second what seemed to be conflicting information or lack of information that we're getting from his doctors and leave that for another day.

But from what we know of the treatment meant Dr Turner, what are we to take as sort of regular people who you know, God forbid if we have to deal with it personally or on behalf of a family member, what do we take away from his course of treatment? What do you take away from it as someone who really understands the various therapeutics. So he got many of the available therapeutics. Is the only one he did not get his consolescent plasma UM. So they used a shotgun

approach and in treating him UM. It's not clear whether this was because he wanted it or because the doctor's recommended it, but nonetheless he got it UM. He got UM the monoclonal antibodies from the regenera incorporation UM. That is something that is not available to the rest of us, it is not yet UM licensed or authorized. He got steroids decks of methazone, which is readily availa bol um. He got from de Severe, which is the anti viral,

which is also pretty widely available for hospitalized patients. UM. So many of the things that he got our things that UM the rest of us to get. UM. The one that stands out is the Regenerata Mono Colonel anybody, which is not widely available. So if if he was your patient, we we've talked a lot about this Dr Towner that you know, executive medicine, if you're an executive and have access. I mean, he has access to the best healthcare in the world, understandably, and we do want

that for our leaders, right. UM. But I do wonder if you were his doctor, would you have done the same thing a shotgun approach? And I do also wonder is that what it was or can we read something into the case of COVID nineteen that he had And we just have about a minute, then we'll do some news and come back. Yeah, it's it's hard to know because we don't have the details of this case, so

it's hard to know. UM. Yeah, it would be total speculation at this point for me to comment on that, But would you do the same the same thing in terms of a shotgun approach if you had a CEO who came to you and said, listen, this is what I've got, you know, would you have done the same thing? To be fair, Yeah, to be fair, I would have

given him everything that I thought was appropriate. And you know, some of the things that we got were clearly appropriate and some of them were, well, I don't know, maybe maybe not so um, it's hard to know without without actually having examined him, seeing his cat scan, seeing a

cyber so it's a little hard to know. Dr Eric Toner Senior Senior Scholar with the Johns Hopkins Center for Health Security and a Senior scientist in the Department of Environmental Health and Engineering at the Johns Hopkins Bloomberg School of Public Health. He's an internist and emergency physician, and his primary eras of interest or healthcare preparedness for catastrophic events,

so like pandemic influenza. So perfect person to be talking to, of course, Johns Hopkins Bloomberg School of Public Health supported by Michael R. Bloomberg. UH and he's with us from cape cod So Dr Turner, how do you see the way forward? Um, Obviously it's a vaccine, I guess. Obviously it's treatments for those who still get the virus. Because here I'm looking at a day where New York, New Jersey recorded the most new virus cases cases since mid May.

So we're gonna be dealing with this again. As you said at the top, you know the virus is still with us. So how do you see the way forward? How do you see it playing out into I think what we'll be seen is um what I call choppy seas who will be seen UM increasing cases here and there. They'll go up a bit, then people will started hearing to the guidelines better. They'll they'll be some further temporary restrictions.

The cases will get better, so as they go up and down in one location, and they'll be going up and down another location, moving around, so it'll be a chop it'll be. I don't think there'll be a giant nationwide spike. I think will continue to see um, you know, hundreds or thousands of local epidemics um, each one lasting

a month or two UM. So I think this will continue UM well into next year and Hopefully we'll have a vaccine sometime in the winter, but it'll take several months UM before we can distribute that vaccine and ad minister to UM, you know, most of the population, which is what we need to do in order to get the pandemic under control. And do you do you have real confidence at the first vaccine that comes out that gets approved, it's going to be safe. You have confidence

in that in our system that's currently in place. Yeah, I am reasonably confident that UM, with their career scientists and the FDA won't get author is the use of an unsafe vaccine. So I am I am reasonably confident. And I think if you know, if they they indicate that it's safe, effective, then I would be willing to get the vaccine and recommend the vaccine. I think there are probably political pressures, at least a political rhetoric um on the FDA. I hope that they can't resist that.

Injustic to the science and Dr Turner, speaking of science and politics, it feels like we're getting ever used to the notion of emergency use authorizations. And you know, we heard about that from Eli Lily. We've got more headlines today, a lot of these stemming candidly from the treatment of the president, seems like that was at least a catalyst. Obviously emergency that it's built into the it's built into the term. This is not the normal course of business.

How much should we worry? How much do you, as someone who knows a lot about this, worry about the fact that maybe we're moving too fast with some of these therapeutics and potential treatments. Well, the the mechanism of emergency authorization was never intended for a drug that had not gone through complete clinical trials. It was intended to allow the use of a drug or of vaccine that had completed all the trials but was waiting for the

bureauxecy to catch up. Because once once the trials are completed in there in there feel a good effect on the move and the drug is safe, it takes the f D a typically three or four or five months to do all the paperwork and to get the license out. So um this was a way to cut off those several months. At the end. It was never intended to be utilized for a drug or a vaccine that had

not gone through you know, full clinical trials. So um I would be concerned about trying to get emergencies authorization or a therapeutic that is still only partially part of the way through clinical trials. Can I ask you a quick question thirty seconds just because that a viewer who's listening to our conversation, this whole idea of what the President said about regeneral and how it helped him and

to provide it free to all Americans? Is that something realistic and that we should expect and unfortunately just got about thirty seconds here. It's totally unrealistic and it won't happen. Um, it's not at all clear that that the Regenera product helped the president. Um, it's going to be a very expensive drug. It would be incredibly expensive provided to all Americans. And it's not that it's not created even that it's that helpful, but we don't know that yet. Thank you

so much for answering that. I really appreciate that, because I know everybody really UM appreciates everybody over on Hopkins in terms of what they know about the virus, and that includes Dr Eric Toner. Thank you so much, Senior scholar at Johns Hopkins Center for Health Security at the Bloomberg School of Public Health. Really great conversation. This is Bloomberg Business Week with Carol Masser and Jason Kelly on

Bloomberg Radio. So this week's cover story in the magazine, they are the Remarks, and they're written by UM Robert Langrath, who is healthcare reporter at Bloomberg News, who earlier you might remember this year wrote another cover story which was about Gilead and it's Dru's drug rem desseviere, which we just talked about on air. This week, he reports about what has been one of our top stories, safe to say over the past week, about how a White House

COVID outbreak America's pandemic failure in microcosms. So let's bring in Rob on the phone in New Jersey along with Bloomberg Business we get it, or Jil Webber on the phone in Massachusetts. I you know, safe to say, Jill, we have all been obsessed by this story, rightfully, so with the President having COVID nineteen and then just watching it spread throughout the White White House and all of

his so see it. Yeah, it's kind of crazy to imagine. Um, everything basically started a week ago today when Jennifer Jacobs UM wonderful DC based White House reporter for Bloomberg News actually broke that Hope Picks had it had tested positive, and then, um, you know, basically a bunch of chaos started to ensue, and you know, within a couple hours, um, we had a positive confirmation that President Trump had tested positive. And then we just started to watch more and more

people close to the president come down. Um. And so we turned to Bob because you know, there's a political story there, to be sure, but you know, the one that really stood out to us was this the the health side of it, right, and the science side of it, and the disease side of it, and all of those things are things that Bob knows, um incredibly well and uh, you know it, this disease, as he points out in

this remarks, make makes no exception of anybody. It does not care what your stature is, like what what president, what what country you're president of? It is just ruthless and relentless. Um. And I think we've learned a little bit along the way, and Bob, like I wouldn't mind actually just kind of opening up with that question, like what did what did you learn over the past week about COVID well, I mean it just it emphasizes just very clearly how how infectious and how easily it spreads,

and how tricky a virus. This is because what happens is is that people are very contagious, often a couple of days before they get any any symptoms. That's one of the peak contagious periods. A lot of the spread occurs before people have symptoms symptoms at all, and that is may that that may maybe something that happened in the White House, and that's, you know, different from some other diseases like stars are most of the spread occurred

when people have symptoms. So what the White Hush did and this is kind of emblematic of the whole way the administration has approached this pandemic, and they kind of relied on kind of a single silver bullet quick fix or relying on a kind of Abbott Laboratory's rapid test, which is a perfectly good test, but if you use it correctly, but it's really supposed to be used for people with symptoms to confirm a diagnosis and get them

isolate them as soon as possible. It's not supposed to be used as the sole line of defense to you know, to keep to allow you to do crowded events without masking social distancing. And that's what the White House is doing again and again and and the problem with that strategy. Get one case slips through one false false negative, and you have a super spreader event and not sure what

appears to have happened. Yeah, and Bob, I mean it really is amazing because I feel like all of us, even those of us who you know aren't president or don't work at the White House, have been putting maybe too much emphasis or too much hope on this idea of like, well what if I could just get a rapid test and then I could go to work, or then I could go to a game, or then I could get on a plane or whatever it is. It's trickier than that, right, right, So the tests are very

good and they're useful. Uh and there there are part of this part of the strategy, but they're not like a you know, a solution for everything just in isolation, because there's just a moment of time that will happen is you get infected with the coronavirus and then there's an incubation pure and not much is happening, and so

you've been infected. There's a time of the virus and starting to grow and grow, and you don't test positive, you know, uh, you know, for several days necessarily, and you know, so you could have a rapid test in the morning it says you're negative, but you could be infecting people in the afternoon, and then you're infected a bunch of people and then like a day or so later,

the test turns positive, but it's too late. Bob. We learned a little bit about how a certain course of treatments can go if you're the president of the United States.

I suppose what what are doctors and others, scientists, people in farm out, what what are people saying about sort of the course of treatments that President Trump was put on, because that's not something that the rest of us probably have access to, right, I mean, he may have been like the only one of the only people in the world to get this kind of combination of three treatments, including this one totally experimental one from Regeneralan. Uh, you know,

in such a rapid, rapid time for him. He got this on a quote compassionate use basis. He got this experimental antibody cottel from regeneral in which they have you know, they're applying for authorization, but they have you know, very few doses of so most people couldn't get that. And then he quickly I was moved to airlifted via the White House helicopters to Walter Reed Medical Center, where he

got from Dezaviere, which is a standard hospital treatment. That's the Guilliad drug drug a cover story on before, and

he got that right away. And uh and uh, you know, after he you know, he was having some breathing difficulties on Friday and then uh like the next day they put them on the steroid decks of methi zone and after he had another bout of breathing difficulty and that is a drug that's basically mostly a usually use for severe cases, which you know suggests to a lot to doctors and some people that you know, the the the White House doctors may have been much more worried about

Trump than they you know, at all. And the fact that they put him on this third drug that's really for severe cases. You know what's interesting, Bob. We just had on a doctor, Dr Eric Turner from Johns Hopkins, and we asked him about Regenera on specifically. And first of all, he said it was like a shotgun approach that they did with the president. He said, to be fair, if he had an executive, senior executive, he probably would have done the same thing. But that regeneration, you know,

A listener said, well, wait a minute. The President said he's going to make it available to everybody, make it free. And Dr Turner said, does That's not really possible. It's just not gonna work that way. It's expensive, that's not possible. So you do wonder about here. You have the president of the White House, right, that's supposed to be setting the tone, you know, um, setting kind of the national plan,

and yet we keep hearing conflicting things. Well, right, so let me give you some context the Regenera on drug. They've said for this month October, they have like the thousand total doses available of that drug. Now, that may sound like a lot on the surface, but there are fifty thou like roughly fifty tho cases of day being reported in the US. And even if you say, you know, maybe only five or ten those cases are higher risk

cases than your older patients or circret patients. Still there's very little supply the regeneral on drug and even if it gets an authorization, you know people, you know, there's a tiny, tiny supply. It's not like everyone. It's not true that everyone will be able to get it, absolutely not true, but it's But it's also just like, as you get to your story that what we're seeing in the White House wood played out is pretty much, you know, an explanation of why we never got the pandemic under

control in the United States. So it's a really really thoughtful read and certainly in the context of the last week, um, something that everybody should definitely check out. Bubbling gra thank you so much incredible reporting when it comes to COVID nineteen healthcare reporter at Bloomberg News on the phone in New Jersey, and our thanks os to Jell Weber, editor

of Bloomberg Business Week. I mean, they have been the magazine and those cover story, especially wh on the virus to spot on well and this one is so timely and as you say, just so rich with context and really important context. Right now we're trying to figure all this out. Check that out on Bloomberg dot com, on the terminal and in the upcoming edition of the magazine. It's the cover. You're listening to Bloomberg Business Week with

Carol Masser and Jason Kelly on Bloomberg Radio. All right, let's do a little Business Week economics now, and really no story I think is bigger to the economy than the ongoing negotiations and by ongoing, I mean months and months now between Democrats and Republicans over a new stimulus package. How Speaker Nancy Pelosi, she caught up with our own David Weston earlier today about the state of those negotiations and working with Treasury Secretary Steve Manutin. He understands the challenges.

We have a difference of money in certain places, but the difference in language is also something that we can I believe we can resolve it will take home promise, but that's what a negotiation is about. So I have confidence in the Secretary, I think the President. I have

confidence that the President does too. All right, so of course US Speaker of the House, Nancy Pelosi, speaking earlier to David Weston of Bloomberg Politics here on Bloomberg Radio and Bloomberg Teeth, I sort of feel like if it's like if you could just insert you know, if if if some buds were candy and nuts, Like if if confidence was candy and nuts, we'd all have a merry Christmas, or at least a Phase four stimulus Like it was

kind of Bananas's honest, it's amazing. And we've talked about this with some of our guests that here we are just a few weeks out from an election like this would be a no brainer for Paul, you know, for certainly the President and I would think Republicans in Congress would want to get it done. So let's see what our next guest has to say about all of this. In today's Business Week Economics, we welcome back Lindsay Piegsa,

chief economist at Steeple Financial. She's on the phone from Chicago. So, se, isn't it kind of mind boggling, Like it's the economy stupid. We know that that's what matters when it comes to elections, and you know, putting the virus aside, you would think at this point, well virus related, that you would want to get another round of stimulus just ahead of the election.

Well it's interesting too, because both the Republicans and Democrats concur with the Chairman's statements from the fund of reserve that we heard it please for additional spending, and both sides agree that additional funding is needed for the economy. Also, with the election, as you mentioned of coming, neither side wants to be seen as the obstructionist party. So it really boggles the mind why we can't come together and

reach some sort of negotiation. Now I realize that there's sizable differences over the details of the reports, but ever excuse me of the proposed legislation, but that simply means that we need to find a compromise that neither side is overly pleased with. So for the Democrats, maybe something on a smaller scale than they would prefer would be better than nothing. And for Republicans at this point worried about out of control spending, was debt to j DP

already set to rise over a hundred percent. Honestly, what's another trillion among friends? Which is the point, which is what j Powe was like, if we ever do it, all right, so what it's better than underdoing it at this point? Right? Well, that's exactly his point. The recovery is faster and stronger than expected. But and he inserted this big but uh, the economy will falter if we

don't see further support. And right now, as we know, the fet is essentially running at full full throttle, so that the focus and the pressure has shifted to the federal government. The chairman essentially handing off that proverbial baton saying, look, now it's up to the federal government to step in and provide that additional aid needed to supplement growth and fuel this recovery beyond just the past couple of months. And so, lindsay, if you were making the case to

this transigent Congress, uh, what data would you point? Like, what what you sort of put down on the table and say, look at this either when it comes to unemployment or consumer sentiment or something related to the consumer because ultimately those consumers, to go back to Carroll's very fine point, our voters, they are their constituents. So what do we need to know about the underlying economy that maybe could help convince people to get something done. Well,

I think it's all about the labor market. And certainly from a glass half full perspective, we have taken sizeable steps in terms of putting Americans back to work, but we're still talking about eleven million Americans out of work,

some twelve million reliance on federal unemployment existance. And even though the unemployment rate has now fallen below eight percent, which is great, from that near peak, we're still talking about a very elevated level relative to where we were going into the start of the year, going into the pandemic.

So I don't think we need to look much beyond the labor market data to really say, yes, we've taken steps in the right direction, but we are far from out of the woods, and we you need at this point some additional artificial support for the economy until we have a meaningful way to separate the healthy from the sick. Remember, this is not a market crisis. This was a health crisis, So we really need to look at this from a

longer term health perspective. And again, until we have that fact in or some meaningful way to separate the healthy of a sick, we're going to have to rely on

artificial support. Well, you know, and I'm going to say, going back to Dr Eric Toner, who we talked to at Johns Hopkins Center for Health Security at the Bloomberg School of Public Health, you know, said the virus is still not over it's still with us, you know, and while we're learning some things in terms of how to contain it once we see um, certainly, you know, growth spurts uh in various points, you know, places around the country or even around the world, But nonetheless it's with us,

and he anticipates it's going to be with us, you know, well into one. So having said that, you know, lindsay, if we don't get some kind of another round of stimulus, um, what's the worst case scenario here? Well, I think even with a second round of stimulus, some sort of middle ground around a trillion dollars in addition to the three

trillion already spent. We are anticipating a second round resurgence of the virus as we enter into cold or fall and winter weather, which is likely to undermine the recovery. So yes, we do expect to Night's thirty, it's gonna pounds in the second quarter, but growth is likely to slow significantly going into the end of the year, potentially falling back into negative territory, and as we turned the corner into one, likely to remain very anemic for quite

some time. So the picture again is very grim still at this point, and stimulus can help that, but even with an additional trillion in federal spending, it's very unlikely that we see pre pandemic growth levels for quite some time. Right, all right, we're gonna leave it there. Thank you for the context. As always, Lindsay Peza is chief economists for Stifle Financials. She joined us on the phone from Chicago.

I have to say, Carol and you, I've been watching politics and business for a long time, and I am a little puzzled by this. I really thought they would get something done. I thought Manuchin and Pelosi, who have had a pretty good vibe going through all of this, would figure something out. Um, but they haven't and and and by the way, they haven't come close. Like then, this is not like, oh, we just gotta get over

the line. They're nowhere closed by all accounts. I'm baffled, Like I would have thought this would have been done with election here. Yeah. Yeah, I just so, I I just don't understand. And I really feel for a lot of Americans and small businesses and other businesses that are having a tough time right now. This is Bloomberg Business Week with Carol Masser and Jason Kelly on Bloomberg Radio the story of the day on Wall Street. It is clear Morgan Stanley, Uh, James Gorman going hunting again. I

mean pretty amazing. I mean I'm stealing just directly, um from our next guest in terms of framing this story. Well, and it's interesting. It was a big deal seven billion for Eaton vey On, second major acquisition by James Gorman this year. And listen, this is moving Morgan Stanley increasingly into the business of money management. And it's a different path than what we're seeing on the rest of Wall Street.

I can't remember that it's in the story or I heard from somebody earlier that people think of Goldman and some others that are kind of, you know, the ones to watch and are recreating Wall Street. And then everybody's saying, no, it's James Gorman. He's the one who's doing it. All right, Well, our guy who's going to make all the sense of the world of this. He's gonna help us is Shrie

Notaraje on Finance Reporter. Extraordinary for Bloomberg. He's been all over this story, he joins us on the phone from New York City. All right, Tree, you've been talking to everybody in and out of the firm. What does this mean? What's the most important thing we need to know about this deal? Well, the moment Stanley, the business that James Gorman inherited, the prestigious White Shoe investment back then he

has to go. Is anything but that Danie has in to this tenure what was once a purely Wall Street focused business. Yes they had made a few bites here and there, but those never really took off. And say the early two thousand's, but like where you were in two thousands ten to where Morgan Stanley is now their dominant position and investment banking and trading, and yet it's their wealth and asset management business that will outstrip those

Wall Street operations. And why is that Even before the eaton Van's deal, about fifty five percent of the revenue for Morgan Stanley was going to come from a wealth and active management side because of the big bank deal they announced with each trade in January to bulk up their wealth operations. So no one really expected them to make such a quick found with such a major deal, but they've gone ahead and done it. And you know, like we say in our story today, what really propelled

James Government to the top purchet. Morgan Stanley was that teller Smith's Smith Barney budgets did it from City Group that turned out to be a home run Dan years later. These two or three acquisitions that they've announced in the last thirty months or so will really leave a big mark on this sum and that will have a big impact on how Morgan Stanley's run most to Jim's Gonnen gone.

Because remember he's sixty two, so we're more we're talking more in Swan song uh corners here than just starting out. So I'm sure he'd love to hear you say that's right. I'm sure if he would not, I was gonna say when we talked to him, he seems like, you know then he had a lot of energy, you know, a lot more left in him. Was that last summer about a year ago? Last time was about year last last September. Yeah, but Columbia business good. We are going to hear from it.

We should point out we are going to hear from him just coming up later on this hour. In fact, girl so Street, we are find me a Wall Street leader who would say that the right that is so true that there's there's no reason for Jimman and suggest that he's done with it. But he's He's been there for ten years. He really was part of the post crisis Wall Street crow that was really rebuilding the banking industry from the wreckage of the two thous crisis. Most

of his speers have faded away. Thinks blacking find thinks my carbat handing over the range. Even think about Jimmie Diamond, who has been CLEEU for fifteen years, but after a health scare. Now he continues to get questions about when the succession is going to happen. But Mr Gorman here he seems to be busier than ever. He's not letting go of the spotlight. So I'm looking at Markan Stanley shares and I mean they've been up, they've been down today,

but right now they're trading a little bit higher. Is this do do? Most investors say? This is a smart move, Another smart move by James Gorman. This makes sense, um, even in contrast to what the rest of the Wall Street the big banks are doing. Look, one thing is clear, it's it's always very hard to get and read because at the end of the day, the success of an announcement like this total it depends on how the integration goes.

But to Jane Gorman's credit, to Modern Stanley's credit, they have done a few recent deals where they're proven that it can happen without a problem, and government is not shy on confidence. And listen to what he told analysts on the conference cult today when he says, you know when the questions were, are you paying too much of a premium to buy even vans? And he says people who are hanging around trying to buy great companies cheaply

never get anything done. All that they managed to do is pat themselves on the back about the wisdom they have, but they never get anything done. And those who sort of buy loudly companies end up paying what eventually appears to be a lot of money that ends in here. So he's pretty confident about that and certainly being projected onto the analysts and investors who are willing to give him the runway to prove that this is a success.

May surely just thirty seconds we're gonna hear from James Gorman. He's gonna be live and Bloomberg Radio, Bloomberg TV. Uh coming up at three forty whilst time, what do you want to hear what would you be asking him just quickly? Well, I mean in he The key part of it now is where does it go from here? Because he's already said I'm done with the acquisition for for the time thing. We've made a better time to lie in it. So

how do you go to the next level? That's obviously key and it's really going to be a showing story from that point on. Proved that you can integrate the trade really well. Proved that you can integrate even man's really well. And if that does happen, you have a really diversified business here that it's it's really hard to co cald in right now. Yeah, alright, great context, Thank you so much, and again we will hear from James Gorman directly coming up three forty Wall Street time right

here on Bloomberg Radio. Shri Nadarajan finance reporter for Bloomberg. He's been all over this story. He joined this on the phone from New York City. This is Bloomberg Business Week with Carol Masser and Jason Kelly on Bloomberg Radio. This time for our drive to the close, let's get right to George Bori. He is the head of fixed income Strategy and portfolio specialist at Wells Fargo Asset Management.

He joins us on the phone from New York. Alright, So, George, we got some dealmaking going on on the side of Morrigan Stanley that certainly is capturing a lot of attention. We've got a stimulus that can't get done in Washington, We've got an election that's twenty six days away from where you sit. What should we as investors be most concerned about? Well, first off, thanks for having me on the show. Very much, appreciate it. Um, you know, from

from our perspective. Um, you know, I think the simple message and we just heard it from Mr Gorman, but you know, the COVID economy, you know, is in recovery mode and I think that's the most important factor that you know, kind of his driving sentiment today is clearly kind of a risk on UH day, we're sort of asset prices across the board, bonds and clue, we're all basically up in price. You know, I think through a combination of you know, optimism, as you mentioned, some dealmaking. Um,

the economic data this week has been okay. Um, you know, it's it's certain these points to an economy that's more in recovery mode than than anything else. It's not a very even recovery, but it's a recovery nonetheless, and importantly, as you mentioned, you know kind of the hope um that that both fiscal and monetary support. You know, it may not be here immediately, but it is likely to come.

So I think the market is starting to look through the election, Uh, they're comfortable with the prospect of quite frankly, either candidate winning um on the hopes that you know, on the on the flip side of the election, that you're going to see a meaningful stimulus package you know that's targeted at at those consumers that Mr Gorman mentioned and also small business, and that kind of helps propel the recovery into next year and and and that's really

that is our base case right now. You know, we have a story on the Bloombar. Investors really can't get enough of high grade corporate bonds. Um. You know, this is your world corporate credit. How do you see it playing out, especially against you know, that kind of economic

market backdrop that you just laid out. Well, I think the biggest driver in the credit markets in general from a demand perspective is just the lack of yield as we all know are as I'm sure many people know, uh, you know, bone yields are very low, kind of across the board. Now they've moved up a bit, you know, ten year yields have been on the move over the last few weeks up about you know, kind of let's

call it thirteen fourteen basis points. That's a big move in our world, but you know, i'd call it seventy seven basis points in total. You know, ten year yields are are high, are hardly um high, uh, and are still relatively low. So there is a demand for what we would call high quality income and and the and the investment grade corporate bond market, you know, has been a place for investors to put a significant amount of money over the course of the year to get that

incremental incremental income UM. In addition to that, you know, the companies that tend to to be investment created while leverage has gone up. They are large cap in nature, they tend to be pretty cash generative, and and tend to have a lot of financial financial flexibility. On top of that, the FED you know, certainly stepped in earlier this year to provide a big, uh sort of hand of support, if you will, you know, which really boosted

the market. So it's a combination of of of the need for yield, which hasn't gone away and is unlikely to go away, but also you know, some some some pretty good um support from policymakers and again you know that that underlying recovery that that does start to help fundamentals. And so you heard J Powell essentially say, hey, guys, uh, Pelosi needs some help here, help your brother out. I've done everything that I was supposed to do and maybe more.

I think that's probably what he's saying, you know, when he loosens up his tie a little bit. Um, I mean, it's right. Has he essentially done you know, his job here, and it really is up to the fiscal side. Well, you know, I think it's I think the reality is, you know, monetary policy has its limits, and you know, the Fed's job is to keep the channels of credit open, to keep um, you know, to try and improve sentiment in the market, and to kind of keep the banking

system effectively up and running. And I think they've done a very good job with that this year. You know, they acted decisively, aggressively and with meaningful, meaningful force earlier this year that effectively unclogged the credit markets. That got investors kind of lending money again, and it got companies and individuals kind of borrowing again, you know. And so from that perspective, I think they've done their job. But at some point, you know, monetary policy is not a

substitute for fiscal policy. And um, you know, when the economy is is really in the doldrums like it has been this year because of of COVID, you know, the the government you know, in sort of Kensie and Pa to see the government can step in and kind of off said that pullback and demand, And I think really that's what that's what Powell is pointing to. He is fully committed to supporting the economy just about any way

he can, but he can't magically create aggregate demand. That has to come from somewhere, and right now, the accelerator has to come from the from the government, because you know, private sector is still very much hurting from the impact of COVID, and so he is kind of pushing on a string, you know at this point, and you know, looking for help from from fiscal policy. Lending versus spending. What the Fed can do and then what what policymakers can do. Uh, they're different kind of tools that they

each have. All right, George, thank you so much. George Bori, he's head of fixed income Strategy and portfolio specialist over at Wells Fargo Asset Management. On the phone in New York City, the lending not spending tour a k pushing on a string. J Powell and the Feds, JP and the Feds and the Feds. J Pow. You don't you don't think that what he was saying is like help a brother out, help a brother out, It would be great, Like you know, then the stories you can write off

of that. J. Bown says, Hey, help a brother out. Nance Jay, come on, you are killing me. It's not gonna happen. She's like, Jay, chill, Bro, It's chill. It's not gonna happen. Thanks so much for listening to Bloomberg Business Week. Download the podcast on iTunes, South Claude, Bloomberg dot com, but 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