Tri-State Area Doing Better With COVID Testing, Roberts Says

Week on iTunes, SoundCloud, al 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. New York City Mayor Bill de Blasio talking about a recent uptick of virus cases in some neighborhoods around New York and so certainly there are some increased concerns about the virus once again here

in the city. Meanwhile, J and J has begun dosing as maybe sixty volunteers in a study of its vaccine. That's a big deal. Goldman Sachs So and HSBC. Meantime, they're among the company's pausing plans to return workers to the office in London, and so there is a lot going on. Back with us is Dr Joey and Roberts. She's Chief value Officer provid in St. Joseph's Health, one of the largest health care systems in the US. We've

talked with them before. Remember, Washington really was at the center of the virus in the US from day one. Dr Roberts joining us on the phone from Everett, Washington. Um. Dr Roberts, so nice to have you here with Jason and myself. How are you. I'm well, how are you all? And what on the East Coast? We're doing okay? Just watching those numbers. Very worried. I think I think it's fair to say we're worried. Dr Roberts, and I wonder

how worried you are and how worried we should be. Well, I think we don't want to, you know, we don't want to overworry, but we all want to be judicious in how we approach the coming season. Well, so how should we approach the coming season? Uh? Well, you know, I heard you say there's a lot going on, and there is a lot going on, but in many ways, a lot of it is a lot of noise. I think, Uh, we have to look at the coming season like we've

been looking at the last six months. It is all going to get back to those basic things that I've talked about before. Whether we're talking about the COVID itself, which is starting to come up again we're seeing more cases again, or whether we're even talking about flu, which is going to be on the horizon here in another month or two. And so what do we know at this point? Dr Roberts and I sort of alluded to this when we were talking about it a little earlier

in the show. What do we know now that will help us effectively contain outbreaks that we know we're going to come? Right? We know there's no vaccine, there's no cure for this, and so I think it's impossible the things like this is just gonna go away. So we're gonna see some outbreaks. What do we know about the most effective ways to deal with it? Is it just the simple things that we know? Or how should we

be thinking about it? So? Um, sure, Jason, So I think there's what do we know is in two ways? One is what do we know and what can we do as individuals? The other is what do we know and what can we do as communities. And I'll talk about the communities first because I think you mentioned New York.

I think New York has done a great job. Many of the states that were hit so badly earlier this year, around New York, everyone is doing much much better with testing, and with that testing capability that you all have out there, what we're seeing is we're able to identify little hotspots

of disease. So rather than New York or Boston or a large city being really blindsided with COVID, when we test a lot, we can see neighborhoods or even parts of neighborhoods with COVID breaking out, and then we can come in and really put in our efforts around masking and distancing to keep that under keep that COVID infection from spreading further. I mean it's as important, yeah, but

I mean it's as simple as this, right. I mean, Jason and I joke about it a lot, like wear a mask, because if you go to the CDC website, it's like wear a mask, you know, even the head right. The director of the CDC said that's almost more potent right now, certainly, or could be as as much as a as a vaccine would be. So when we see these bursts in whether it's New York City or other places of the country or over in the UK, is it just simply because people are not wearing masks and

they're not social distancing. Is it just as simple as that, or is it because as the world gets colder, or is there something environmental that we're just gonna unfortunately have to live with the second wave of this. No, it is as simple as that. But we also are going to have to live with a second wave of it, because, um, we can keep this under control. I think Dr Redfield said it well last week to Congress. While we all wait for vaccines that we hope we're going to be effective,

the most effective thing we have right now is a mask. Yeah, so go ahead, no, no, no no, please finish. Yeah. So most effective thing is a mask. The second most effective thing is just reducing the number of people that you interact with and keeping distance from them. It is that simple. Talk to us about the flu, the common the more seasonal flu, and how that plays in here. Well, it plays in really well because the same things that we're doing around COVID, we will keep flu under wraps if

we keep those masks on and keep that distancing. And then of course with flu, we have vaccine. We know the vaccine works, and so getting getting your flu shot early is going to be a great idea. You know what I want to ask you, Dr Roberts, because I actually was at the doctor this morning and wanted to get a flu shot, and they're like, really sorry, but the flu shots haven't come in from the West coast because of the fires that there have been delays, and

I just thought, I'm just curious. And then I got into a conversation with the doctor who was saying that, you know, there are some concerns I think about production gearing up for vaccines for the virus, the COVID nineteen virus. So I do wonder do we need to be worried? Will there be enough flu vaccines? Will they come in time so that we don't have to pile that on top of our worries. Um, sure, Carol, I think we are in great shape with flu vaccine. I'm a little

surprised that your doctor didn't have the vaccine. I know that it's stocked pretty much across the western and Central United States. I had not checked into the Eastern States, but UM clinics have been set up pretty much throughout the western two thirds of the US UM and I think there's not going to be a problem of shortages

with the flu vaccine on COVID. We are making plans now, we are we're starting to make our plans for how we're going to vaccinate folks when vaccines becomes available, and we are penciling in late November at the time when we hope to see the first vaccine, and we think that we probably would see adequate supplies about nine months later. Interesting, So in the meantime, talk to us about schools, because you know, both elementary and secondary high school, but also colleges.

I mean, this has become one of the critical questions and one of the critical I dare say, sort of controversies that we're all looking at right now. How do you read it, well, Jason, I think the primary and secondary schools, I think are one topic and colleges are totally separate topic. And I will say I think there's no more difficult circumstance to deal with the policymakers than

primary and secondary schools. How if you bring kids back even in places that have low prevalence of disease right now. If you bring kids back, it's hard to socially distanced kids, especially grade schoolers. How do you keep them from sharing their fluids? I mean, gosh, we've all had kids in

grade school. Yeah. Yeah, And and so I think we see a lot of districts trying lots of approaches, maybe a hybrid approach in areas where there's very little outbreak right now, and then more homes, you know, virtual schooling and places with higher outbreaks. Listen. One thing I want to bring in our Vince Signarella, who we talked at He watches the markets for us. We talked to him at the top of our broadcast Dr Roberts, and he

just sent us a headline from the Washington Post. Study shows coronavirus is mutating, potentially evolving, like we don't have enough to worry about. What does that mean? We would expect that, and we've seen mutations already and a trigge in in virology. Mutations are expected, they're common, and generally with new viruses, mutations are good news because hands they tend to become less virulent. So when we see mutations with early with new viruses, they tend to be less

They create less severe disease than the previews. But do we have to keep chasing new vaccines to deal with it or now? And just got about thirty seconds here. I don't know yet, too early to tell, but those vaccine makers are expecting mutations to occur, so you can be assured that they are designing for those mutations. All right, Well, we always learned so much from you and your team.

We really appreciate it. Dr Joan Roberts, Chief Value Officer of Providence St. Joseph hel joining us from Washington State. Of course, that is where we all first heard about and encountered this from a domestic perspective. So they Dr robertson her team have been watching this so closely and have been very kind to share a lot of those findings with us, and you know, keeping us honest on candidly care what we know what. We don't know what

the best advice is at any given time. One of the things that's clear, we do know the best way to at least send this off. Wear a mask, Wear a mask, social distancing it works. This is Bloomberg Business Week with Carol Masser and Jason Kelly on Bloomberg Radio this week, especially Equality issue of Bloomberg business Week magazine.

It's a compliment to today's Bloomberg Equality Summit and the cover story about how it's time for a new approach to cure inequality because capitalism will, folks, it just isn't cutting it. Let's get into this story with Bloomberg News Diversity and Sustainability reporter Rebecca Greenfield. She's on the phone in Brooklyn. Also with us Bloomberg business Week editor Joel Webber on the phone in Massachusetts. Very provocative cover story,

Are you here, Joel? Yeah? And UM credit to Rebecca, who has done a number of stories for us this year, and I think this is their second cover UM in

in this space. And when we started started talking to her about how we wanted to approach the quality issue, I think she really came at it almost like a little bit of a sequel to her last cover story, and it was the idea that the last time, it was the idea that businesses just have a dearth of of of black or minority CEOs, people of color, um and with a really really provocative cover that showed just

how white the fortune is. And this time I think she went even a little bit bigger about this and said, look like, actually the force of that companies have been relying on here is the market. The market is supposed to correct things, and it's clue clearly not working. And even more provocative, I think, is this idea that within HR departments D and I of the Diversity and Initiative crew has actually been part of the problem. Almost I

could pick it up from there. Yeah, thanks so much for having me and I yeah definitely also seated as a follow up to the last piece. But like Joe said, the driving force behind diversity and inclusion initiative to the last three decades has been this market driven approach. So this idea that you know, discrimination and inequality is bad

for business. Um, you know, you're you're losing out on productive people if you discriminate I guess people just because they look like And also there's so much research showing that diverse teams are just better and more productive. And this has been driving the dconied apartment and you know, billions of dollars of industry to get more people who are women and minorities into high paying jobs. And in the piece, um, I get into how that hasn't worked.

But also you know how the George Floyd protests this summer um have led to a bit of a shift in thinking away from this kind of dominant theory. And so Becca, what are people actually doing about it? I mean part of what you know, I know you and your team have described as this is obviously moving from the fringes into the mainstream, into the main conversation. That's one of the pillars of everything we're doing with the

Equality Summit. But what sort of actual movement are we seeing or is the entire point that we're not actually seeing anything. We're so actually are seeing some changes, And I think the biggest thing is, you know, this is not going to sound like that. It's a mindset shift. So before it was kind of like diversity is good, and now it's like, Okay, racism is still happening, and

so we need to do things combat racism. I think we can add that to other isms that racisms in the focus um for the summer for a good reason. So I think that's been a big shift, because you do different things once you start thinking about it in

terms of fixing racism as opposed to promoting diversity. And I think The biggest thing that I've noticed that's more tangible than in mindset shift is things that look very similar to and I would describe as quotas um, which is what my first article was about, which I remember that that was really great because I really thought about that. You know, does this is this what we need to do? Yeah?

I think companies, although they are reluctant to actually call it that because they're very scared of the word for various reasons, they are something like, we are going to aim to have a certain number or percentage of black people or Latin next people in certain high paying, high

power roles. And that is difference. They had not done anything bad aggressive before the Five Lives Matter protests, and I think it's things like that that might move the needle more or a very least just trying something different and then and that's a big shift in the last couple of months compared to the last thirty years. Back in one of the most provocative things, I'm gonna steal your here a little bit um or at least let you steal your own thunder, uh is your opening anecdote

from seventeen um that is about Apple. Can you share that one because it's such a provocative way into the story. Yeah. So in twenty seventeen, the woman who is hanging up Apple's diversity and Incision department, she sing at a conference and she said, in her own arks, she said, there can be twelve white blue eyes, blonde men in a room, and they're going to be diverse, and they're going to bring a different life experience and life perspective to the conversation.

And she apologized for those remarks because you know, people said, uh, you know, that's not really diversity. But it was realing that that the mission to get more women and minorities up and down the Colvor ladder had really become diluted, and it really become driven by this idea we just

made diversity of thought and experiences. And when you think, like, yeah, it's true, like a certain of you know, white blonde, blue eyed man from me or twenty is going to be evernten at white blood blad man from somewhere else, But it does not has nothing to do with the original mission of getting more women and minorities higher as

the coorperater. You know. The one thing is, and I think about targets, right, I mean, if we want transparency like we need to unfortunately, especially early on, look at the numbers, find out where we're lacking as companies and institutions Rebecca right. And then it is kind of a simple fix if you just set some targets to say, Okay, we need to consciously think about this and make sure we up the numbers. That's how you can kind of change this. It feels like in a in a in

a much faster manner. Yeah, And I think the one thing that's missing from that is where are the consequences? And I think right now it's self imposed. And I think, you know, it's up to journalists and consumerism however, to say, like, okay, where are you on this? You know, you made those the promise or target you know, in five years and you met it um. But I think you know, the things that work are you know, chastising people when they

don't when they don't meet their their quotas. And we've seen that before with the California boards law, which has also written about before that you know, uh, there's a penalty a hundred thousand dollars, which you know is in a ton of money for big companies, but there is a penalty if you don't have a woman on your board. And I think and that really moved companies to move.

So we'll we'll see as kind of this the public reckoning is enough to keep companies on it, but I definitely think, yeah, the target is a stub one stub to is this pressure right? Right? Well? Uh, we love your work and the work that you've been doing, not just for Bloomberg Business Week but really running this team that is taking this on has been spectacular. So thank you,

Rebecca Greenfield. Really good to catch up with you. Rebecca Greenfield, she oversees all of the managing diversity coverage for Bloomberg. She joined us on the phone from New York. Till Webber, the editor of the magazine the Special Equality Issue. He joined us from Massachusetts. You're listening to Bloomberg Business Week with Carol Masser and Jason Kelly on Bloomberg Radio. All right, so for Business Week Economics today, let's head down to the a t L. Brad Dillman is their chief economists

for Courtland. He's been looking at the home sales numbers, existing home sales numbers, and the broader housing data because housing, we know Carol is such an important indicator of where we are, where we've been, where we're going. Especially, we all want to know where the heck we're going right now. So Brad, really nice to catch up with you. What's the most important thing we need to know? Actually before I ask you that, because you're in the A tail

in my hometown. Um, how is it down there? What's going on? What's going on in Georgia? Right down here? You know, we finally got rid of that hot weather. You look at our housing market, it's doing okay too. I think we've seen some outperformance in multi family, more than we had expected given the condition. Kids back in school, Like, what's going on around town? Well, our first grader is going to be doing homeschooling this year. Um, I think

it varies city to city. But I don't actually know because I only got a first grader and in preschool, so I don't focus on the on schooling. I focused on housing. We know, we know, we get that, we totally get that. But what I guess what we're trying to get at is as we talk with with individuals around the country, we do like to check in with them about how's it going on the virus because We had some news today of some you know, clusters in New York City where we're starting to see virus cases

pick up again. So we're just wondering, how's Atlanta doing. Yeah, so as far as the virus directly, you know, it's Georgia has picked up a little bit, but it isn't anything that's truly affecting our day to day. Our office here at Courtlands has been opened for several months now, and most of our folks choose to come in. We do have a math policy, so people abide by that, and if you go out, there are people with the restaurants, so there's definitely still a social atmosphere going on that

kind of thing. But you know, our traffic is down by a lot, and candidly, that makes it a lot more livable. Yeah, oh my god, it's like Los Angeles sometimes and it's worse moments down in Atlanta. Well, what's interesting is your company is actually a multi family real estate company, so you're involved in construction, design, property management, you know, all of it. So you do have a very strong window or clear window, if you will, into what's going on in the housing market. You said traffic

is down, talk to us at bit about what you're seeing. Well, when I meant traffic, I meant traffic as on the road. Okay, we're still seeing plenty of interest in the communities itself, you are you know, Yeah, multi family occupancies have been at roughly a twenty year high prior to COVID. Now they have come down a little bit. Atlanta has held up, you know, just fine. We haven't had any any notable

issues here. Our segment is really more and sort of a high b low a kind of a framework, and that is generally a white collar worker that hasn't been affected by the kind of job losses we've seen in leisure and hospitality. But if we go back to National, you know, you had a very very tight market when it comes down to occupancies, they've come down a bit.

We think they may go down further, but we actually think there's the potential they could tighten back up in about a year and a year and a half and we may see the re emergence some of those costs of living pressures that we had that had really dominated a lot of social narratives back about a year a

year and a half ago. Yeah, So what about the sort of geographic shifts that we're seeing, especially from sort of a white collar perspective, you know, with people saying, well, if I don't need to be in a New York or San Francisco or Los Angeles, you know, I may favor moving to a Nashville and Atlanta and Austin Denver. Is that manifesting yet in the data that that you're seeing, either within the company's holdings or in the more national data that you're saying, Yeah, this has been a trend

for some time. So I would actually say that migration to the sun Belt, which is precisely Courtland strategies to be in the Sun Belt, migration really peaked about four or five years ago, and it's actually been flowing now. It's still underway. It's still very attreative to those jurisdictions to be getting net inbound migrants from the Northeast and the West coast. It's still really helping to drive rent and activity generally. It's not what it was four years ago.

Now when we look at it in terms of COVID, we don't really see a lot of data yet. But what we do see is what we can see anecdotally and what we capture in our own data. Cortland is the largest owner of multifamily apartment homes in both Atlanta and in d f W that's Dallas Fort Worth. But essentially what we can see there is we can still see anecdotal evidence, that's to say, the piece of the people who are coming in to tour our units or people who tour our units online, where they are and

where they're coming from. And we're definitely still seeing a movement of people out of the Northeast and in particular in Phoenix for seeing a lot of folks from California is still moving into Arizona and taking a look at our communities. So what's what kind of visibility do you have and what maybe looks like. Yeah, so we run

a suite of forecasting models. We forecast about forty five i've metropolitan areas the United States, maybe six D submarkets, and we forecast effective rent growth and occupant sees and supplying demand. And what we're seeing right now is still an expectation for a slowdown over the next call at six months, we expect annual rent growth to actually be negative in its in its upcoming prints and probably trough

in Q one of next year. And then we expect the market to retighten in the second half of a right, get to tighten in the first half, second second half. Yeah, so a little bit of weakness in the year term near term, once you know, the election uncertainty is behind us.

Once we get a little bit further in what at least so far has been a v shape recovery in employment markets, we expect that we'll see a retightening and multi family and I should say a lot of this truly goes back to some of the actions that had been taken by policy makers coming out of the Great Recession, and that was to stimulate home prices even though housing was oversupplied, and even though labor mark gets were in

a terrible condition. The results of that has been, you know, a large difficulty in delivering housing supply in any kind of scale over the last ten years, and by our estimates and the estimates of others, this is what has contributed to a prevailing undersupply of housing in the country, not just in terms of listed inventory, but the physical product for people to live in. Interesting. All right, Well, thanks for the update. We really appreciated. Good luck down

there in Atlanta. Brad Dillman, Chief economists for Courtland joining us on the phone from the A t L. Hopefully he can help the Falcons get a win because they are really having a tough time. But just saying, our buddy Arthur Blank had a very very bad weekend again right again, yes, the journal. But you let me drive. Oh no, no, no, no, honey, please, I'll do the right I want to drive. Just drive, baby, the questions trying. This is the Drive to the close. Thanks, We'll drying

us down on Bluebird Radio. Alright, time for the Drive to the clothes. Let's check in with Mark C. Smith. He's vice president Wealth Management portfolio manager for UBS Financial Services. He joined me. He's joining us on the phone from New York City, Mark, how are you? How are things? Well? Yeah, we're doing the best we can on the circumstances. Uh. You know, most of us are still working from home, but we're going to the office from time to time,

so we're just making the best of it. Yeah. Yeah. And so how does that change the way that like you deal with clients and sort of talk to them, because I'm sure everybody's in similar circumstances, but it's got to change the way that your sort of world operates. I would imagine, yeah, it's it's it's turned to everybody's life upside down. But I think what this is bringing to everyone is resiliency and I'm seeing that firsthand every

single day with my clients. I have clients that owned restaurants. They are completely changing their model to ordering online and delivery service and that's making up much of their revenue, especially the ones that are in New York. But the ones that have some clients that have restaurants and airports, I mean, they're just they have no way of getting out of this um because riderships down on most US carriers,

So those folks are really struggling. You're seeing though that the professional class folks that can work from home with a with a with a laptop are saving up an extraordinarily amount of extraordinary amount of money and they're able to purchase homes in the suburbs. And that's why you're seeing UH sales and the suburbs a record highs. And you're seeing a flight from you know, major metropolitan you

know areas because you're you're you're an apartment building. So many of my clients are just are are high talent and York and going to the Hamptons or Connecticut and deep in Jersey where they're getting you know, sometimes doubling their living space. We're definitely seeing it. Does it stick, Mark, or do you think it's just until we get through this. I mean, a house purchase is not something you buy and then like change your mind the next week. But

I get that, But I'm just curious. This is changing the paradigm for probably our generation. I think that it's going to be very difficult to tell folks to come back in when they worked for a full year, possibly too from home and productivity didn't go down, it went up.

So I don't see any employer telling folks who who are doing well in this environment that they have to go back to the office when a vaccine is distributed in the next you know, three or four years, because let's be honest, even if it's we we get a vaccine next year, you're talking about a two year implementation of getting that out to three million plus Americans. So you know, that's the reality is that once we figure this out and are adapting quickly and they're continuing to

make money. You're seeing that in some of the SMP five hundred stocks. I mean, folks are really killing it in this environment. Unfortunately, the rest of the country isn't. And if you're working for one of those companies that are just doing really well, I don't see them making you come back to the office, right And we're going to talk to General Mills, the CEO. They reported earnings today, you know, and people have been stocking up their pantries and so we're gonna get an idea of kind of

what the outlook is. Um we want to move on to the markets. But one more question you talk about, you know, nobody really pressuring because productivity is we're doing you know, doing well, and a lot of industries and companies we're seeing a play out in the market. Having said that, there is pressure though within the financial sector, it seems like for people to get back to office,

especially in New York City. Well, I think what the financial sectors realizing is that they have the biggest uh you know, foothold in lending money out for the purchases of commercial property, residential property. They have the biggest amount of to lose if things don't get back to someone in normality pretty quickly because they're on the look for billions of dollars of these buildouts of these major cities.

So they've got a lead by example because they've got the most to lose, in my opinion, and so they've they've got to get workers back in it. Got to start building some confidence in these major cities. Otherwise people are just gonna cut and run and they're gonna be loved with the bag. That's my opinion. That's really interesting. You sort of have to prove that you're in it so that uh so that your clients ultimately will pony up. Very interesting. So, Mark, we are talking all the time

on this show. I think probably around our kitchen tables are dining room tables when we're socially distanced with neighbors and whatnot. About the election. You know, we're forty one, forty two days away at this point. As an investor,

how should you be thinking about this? This is gonna be one of the most consequenceial elections of our generation because you'd have you know, two completely different candidates, the country split you know, down the middle depending on where you live, and that this is going to create a tremendous amount of volatility and portfolios for the next forty odd days and there's there's a good reason that we have you know, sixty million people out of have of

apply for unemployment over the last twenty six weeks, you know, and right now, uh, we're we're kind of ignoring them. We're just kind of looking at them five hundreds. And so that's going to play out in in this election as well as in in a big way. I don't think where I think we're underestimating how many people are hurting in this country. And then and then you're depending

on a stimulus plan. Let me tell you something. If the Republicans shove a set of a Supreme Court justice um and in the next forty days, I don't see any reason why the Democrats would go and and help them out get the second simulus package. And we need a second stimulus package. That's why the markets are reacting in the way they are to they were down six hundred. It's because we don't see any end insight, no help insight from the federal government. Besides what the Fed has

already done. Rates are basically zero. There's not much more they can do. They've got to look the Congress. Congress now has a huge issue. They are split out to the Supreme Court, and they're not going to work together until they figure that out. Therefore, we don't see a stimulus package. Probably untie how many Americans can deal with

that amount of uncertainty. So this election is going to be huge in in that um folks are trying to figure out how they're going to be able to make money with a Democrat or Republican in office, depending on who you are. I understand why you would fall on either side of the coin. But the problem is is that until this is all sorted out, it will not be sorted out on November three. That's additional volatility to what we have right now. So you know, that's the

that's the real thing. How much more upside do we have in this market to stay in with all this uncertainty around us? I feel like the debate needs to be is it going to be the distressed investment story going into or will it be you know, the recovery cycle? Uh? In terms of what what the story and theme will be. We can't recover without a vaccine, bottom line, So if

we don't have a vaccine, we're not recover ring. How could we move forward and the economy in the stock market it's gonna be very hard to do because it's because because if people are gonna come continue to close down to schools, their businesses or restaurants opening and closing untildars of vaccine, and how do you get back to normal if that's happening, right and seeing it already in London, and some worries about certain parts of New York City.

Hey Mark, great to have you here. Look forward to having you join us again in the future. Marxi Smith, VP of Wealth Management and Portfolio Manager at UBS Financial Services, on the phone from New York, coming in hot kind of like that. I like it. Thanks so much for listening to Bloomberg Business Week. Download the podcast on iTunes, South Cloud, Bloomberg 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