U.S. Jobs Surge Defies Omicron

Bloomberg Business Weekend iTunes, SoundCloud, or Bloomberg dot Com. You can also listen to our radio show at two pm Eastern Time on the Bloomberg Radio or watch us on YouTube search Bloomberg Global News. So it definitely could have gone either way, at least according to economist estimates which were all over the place. What did happen is that the US labor market showed unexpected strength last month, despite record COVID niniteen infections and really showing signs of extending

the momentum into the new year. A surging wages added more pressure on the FED two raise rates. You were all over this week about the wide range of estimates for those non farm payrolls that four hundred sixty seven thousand game that you referred to in jobs. That's our past all economist estimates at seven thousand job difference between the number that we got from a DP earlier this week. It's to forecasting right now. Yeah, I'm gonna give them one.

It's it's like there's a there's a good article in the Bloomberg right now about how tough it is for economists right now. Hey, let's talk about this with us. Susan Arthur, chief executive officer at career Builder. She joins us on the phone from Philadelphia. Susan, how are you hey? Good? Hey Tim, Hey Carol, thanks for having me ony, great to have you with us. Did you see this coming? You have great data at career Builder. We see uh, you know what we see at career Builder is millions

of jobs flowing through this site every day. It is picking up constantly. Um. But to say we could have landed this exact prediction, no, Um. We do see some other emerging trends under the numbers though, that are new for us, and I'll take you through that. Yeah, because because you know what, Susan, that's what we love like talking to someone like you that you guys can get really specific about where is the momentum and what going on?

So so digg in dig into that area for us if you would, sure, So things that we all know and that are obvious, like the top you know, top number of postings are transportation and logistics and moving cargo, and that the healthcare jobs are of three hundred three hundred plus percent. You're a rear what's newly emerging for us? Obviously the work from home thing is persisting, but what's also newly emerging for us in terms of demand is about a five hundred and increased in demand for community

and social service occupation. So under that vernacular, I think of the top ten jobs in social work, in licensed therapists, in family therapists, in substance abuse fields. So that's an enormous emerging trend. And if you think about that in the concept text of the pandemic and the workforce and burnout and everything folks have managed um through COVID, I mean it is spiking at an extraordinary rate. What's that increases that year over year? A month over month? What

year over year? Okay, January Jannuerar, right, right, So it's pretty and it leads like for us it's one of the leading of healthcare for us your every years three So it's out there, it's standing out. Transportations up for us on our site hundred sixty seven percent. But it's really leading extraordinary numbers. And then other numbers are you would not be surprised about tax planners. We're from home

tax planners, things like that. Not so surprising, right, But um, that's that's probably the biggest category of labor that's breaking out for US UM with really big numbers. What about when it comes to just sheer aggregate job postings on Career Builder, how much has that increased in recent months? It has increased since the beginning of the pandemics three x three and then year over year two percent, So it's pasting. It's up all the time, the number of

postings flowing through this site all the time. In the number of job seekers flowing through the site is continually up. So it's both there's a demand on the on the side of companies looking for labor. At the same time there's demand on the side of individuals looking for work, right, and that individuals looking for work absolutely is part of the quit you know, this extraordinary quick thing we have going on in the churn in the workforce and it's

people coming back. So as we come back post pandemic, we talk about going back to normal or how the labor force has been changed dramatically. How would how would you address that area has Is it going back to normal pre pandemic or is it something different? Carol, Let's do us like the complexion of the workforce is, you know,

potentially permanently changing, meaning who works for whom, for how long? UM, What career mobility looks like, what requirements workers have about how the work, when they'll work, where they'll work, UM. Where we see employers meeting employees on skill development and um doing extraordinary work and you know, increasingly creative work to hold an employee longer and to sort of beat the average in terms of how long you retain people.

So we see a lot of good things happening on the employer's side in terms of really trying to address who is this new workforce? Right? If if we take the aggregate number of people working and the generational complexion of that workforce and then what their expectations and needs are, we do see creativity, We see productivity, but we also do see sort of the see change and how work gets done and how much of that is permanent? I mean we're at right now. Working from home doesn't change,

doesn't change radically. Does average tenure at a company continue to shrink maybe for the foreseeable future. Does the generation that stepped out a little bit early, you know, those couple million people, how much does that packed us? So we see this this enormous change on both sides, like of our marketplace, it's on both sides. What a workers need, what's going to get them? And then why are they

going to stay? Yeah, we certainly feel like they're I kind of think the stories were going to calm down, but I feel like they're picking up momentum, especially as we I think people are really making decisions about coming back or or how they're gonna work. Like we just talked about the example of that thirty one year old who went to that competing tech firm to get an offer and he got a raise of seventy grand two. Right, Yeah, it's like pretty remarkable. Hey, Susan, thank you so much.

Susan Arthur, chief executive officer, a career builder, on the phone from Philadelphia. This is Bloomberg Business Week with Carol Messer and Bloomberg Quick takes Tim Stinovic on Bloomberg Radio. But administration may have to ask Congress to prove additional aid to fund coronavirus testing, therapeutics and vaccines. This is coming from the Washington Reports, the Washington Post reporting there's a bunch of things going up. But let's get to

our guests. Yeah, Dr Ian LUs Faders, clinical professor of Medicine at n y U Land going to medical center. He joins us on the phone from Long Island this afternoon. Dr LUs Bader, I want to get right to it because you sent our producer Paul Brennan a really interesting article that answers or tries to answer the question why some people get COVID when others don't. It's a question that Carol and I have each been asking ourselves a lot over the last year, because a lot of people

around us have gotten COVID. Right. It's like one of those things, and we even talked about in the news room, Tim, if you think about it, we'll be sitting next to someone and they're like, yeah, I got it really bad, and you know, but my my wife, my husband, my partner, they're fine, or my kids are fine, or my kids got it and I'm fine, and and I know in my home we might have isolated when there was nervousness,

but come on, you're all breathing. They're not saying you outside to the backyard, right, Carol, as much as they might have won. Dr in Lustbader, Clinical Professor of Medics at NYU Lane Goes Medical Center. Why Dr LUs Bader, do some people get COVID and others don't? Great question and Happy Friday, by the way, And lots of physicians in science US are looking at that, not just for COVID nineteen, but really for a whole variety of infections,

whether they're bacterial or viral. Obviously, COVID nineteen is a viral infection, Influenza very common. We think there are probably several reasons. One or certain genetics, certain h l A types, in other words, certain markers on you ourselves that that are involved in self recognition may play a role. Also,

probably prior exposure. COVID nineteen is a coronavirus, and there are many coronaviruses that cause the common cold, and we think that perhaps there's some cross reactivity, in other words, that if you've had common colds in the past, you have some antibodies to coronavirus, whether or without getting the COVID nineteen vaccines, and that may provide some protection. But

you're exactly right. There are people where it rampages through the family everyone in the house gets it, and there are other families where it's either very mild infections we know some of those as in our host, or asymptomatic infections, or some people just don't get it and everyone else in the house has had it. So part of it is probably prior exposure, uh to a similar viruses. Part of it is genetics. Some of it may involve viral load, in other words, how much coughing or how much of

the virus really lands in the names of parents. But even when they do experiments on people where they give the exact same amount, some people respond to the infection, others don't. Yeah, it is really Fascinating's funny. Tell her Rigs on our TV side also enter Bloomberg Radio audience. She and I've talked about it because she has been coming to work from day one, She's been traveling since day one of the pandemic. Has not officially gotten COVID. By the way, we get tested every week and we

get tested all the time. We know if we had it and didn't and just didn't have symptoms. Right, she's had no positive and she's like, I wonder if I've just been slowly better. You better not curse her, Carol Singer. But we wondered, like, has she thought, you know, have I just been constantly exposed a little out of time and somehow created some super immunity to it. Um, So

it's really interesting. Um. You've also shared with us a story and we were talking about this in preparation for a conversation with you about research on lockdowns having little impact on saving lives left for you to I'm sure you saw that if it was in the New York Post weigh in on that. So this was in the journal Cold Studies and Applied Economics Literature View and met Analysis.

Met analysis means a number of studies were reviewed. In this case, they were twenty four of the effects of lockdowns on COVID nineteen mortality, and there were several authors, one of which is from you know Hopkins, although not officially.

Uh Hopkins did not officially weigh in on this, and they really reviewed a number of studies from a variety of different countries looking at lockdowns and the effect on mortality, and part of this is a number crunching, and they found that it was really a minimal effect point two percent decrease in mortality and UH a slightly better effect on home self isolation, which was a two point nine percent reduction. So it really calls into questions some of

the public policy. Should we be locking down and how effective is that? Obviously some countries like China have been very aggressive. Other countries in the scandinating like Sweden really are sort of open for everyone. And I think it's important to get this data review it, to criticize it UH and or accepted, because that should affect future future policy. You know, we should be locking people down if it's not going to be effective, it's certainly something to roll

into the conversation. Ian. Thank you so much, Dr Ian LUs bid Or. He's clinical professor of medicine n y U Lang. Going glad to hear too that he sounds a lot better, because I know he's been dealing with all of this over the last few weeks. This is Bloomberg Business Week with Carol Messer and Bloomberg Quick Takes. Tim Stinovic on Bloomberg Radio. You're listening to Bloomberg Business Week with Carol Messer and Bloomberg Quick Takes Tim Stinovic

on Bloomberg Radio. We also want to talk about the Remarks section of the new issue of Bloomberg Business Week gets out online, on newsstands and on the Bloomberg and Bloomberg's Chris con And writing about how President Binden is essentially rebranding Reaganomics to save his own economic agenda. We're talking supply side economics. We're doing that with Chris Condin, Federal Reserve in US economy reporter for Bloomberg News. Joel Weber is editor at Bloomberg Business Week. He joins us

on the access line from Brooklyn. Joel, is it is it more of a question of of branding than it is of actual a difference in the meaning around supply side economics. It's uh, it is a rebrand uh. And and it is like maybe um, the most like head spinning thing that you know, I think a the Democrats could attempt to accomplish here with you know, supply side economic economics. That is this thing that goes back to the Reagan era. The whole idea of kind of Reaganomics

kind of almost built around it. And what seems to be up the new the new strategy from the Biden administration basically kind of led by Janet Yellen and Treasury is to basically like take over that term and use it for purposes that could you know, help champion build back better. But Chris, um, how is it going over in d C? Well, I have to say Joel that there there is a corner of d C that is

really excited about this. There are, we've come to find out, um, a whole bevy of liberal economists who have been really anxious for the Democrats to adopt a version of supply side ecn coomics and have been championing this. Now. It's very different, it must be said, from the the old traditional style because of the role it sees for government. Um,

but there is definitely a group of folks out there. Uh, someone would say this is really nothing new, and others who would say, well, this is really what we finally need, is that a government being very active in marshaling resources into underinvested in public goods. Alright, so traditional reagonomics. I love this. It's like an economic lesson and taking us back through the politics and the Reagan era, um, which is one the Republicans are so proud of, right they

laud uh that era in the White House. But traditional supply side economics, right, we're talking about it's a lot of tax policy that's at place here. Absolutely, absolutely, Carol. The heart of supply side economics is about how taxation alters human behavior by extension the economy. The idea, you know, if you're going to be for your next hour work, if you're going to be taxed at a much higher level than you lose some incentive to work, and you

apply that broadly. This theory says that whatever the government does which requires taxation will on the margin, to some extent, hinder the supply of capital and labor to the economy. So the more you tax, the less the economy grows. Now, there's a lot of debate. The theory is is pretty well accepted, but the debate is around how much really.

And then there's this other problem that by the administration is attempting to address that certain things that are absolutely necessary for a productive economy, the private sector just won't

do enough of that. Just think about infrastructure, basic scientific research, education, Jenny, you know, in this saying we have neglected these things were far too long by over applying this idea of supplying economics, and only the government can come in and organize the resources to pour into these things in the amounts that are necessary. And if we do them, it will have some cost in the short term, as supply side economics says, but in the longer term, we'll have

a much bigger payback. So that's their theory and that is their swiss What's interesting, Christ after reading your story, I learned that this is not necessarily something new to a certain circle in Washington of policy walks who have been for years calling for progressives and Democrats to embrace this absolutely true. Yeah, they're even I mean there are conservatives. Most conservative economists absolutely admit that they are. Like I said,

there are some things the government must do. You know, we want to build a navy. We can't rely on the private sector to do that. Um. But there are also these this this uh swap of liberal economists who have been saying the government needs to invest in these big public goods and not just provides the transfers to to help poor folks, to support underprivileged folks, but also we must invest in these things that are necessary for our economy. And they add crucially childcare, which isn't always

included in these supply side ideas. But yell And and the bind administration are saying no, if we want a healthy supply of labor, in other words, parents with small children, if we want them into workforce, we must have affordable childcare. That's another new Democratic spin on supply side economics. Okay, so Chris, I want to ask. I mean, one of the amazing things about the story is like the number of sort of policymakers, former policymakers that you actually talked

to UM. One of the big names that jumped out of me is Glenn Hubbard, who has obviously uh instrumental in George W. Bush's tax cuts in two thousand three. What did what did Glenn Hubbard have to say about this move by the Biden administration. Well, he's said a couple of different things on two different levels. First of all, on the economics, Uh, he doesn't think there's anything new about UM requiring the government to invest in certain things

like infrastructure and education, etcetera. He very much quibbles with the idea that subsidizing childcare is really a supply side um argument and that kind of devolves into semantic so, but he's a skeptic on this front. Now. I also asked him interesting about the messaging side. I said, well, you were in government. Isn't it important for an administration to be able to have a good, clean message for

what it's trying to accomplish. He agreed, He said absolutely, Yeah, you need to explain things and you want to try to win over nonbelievers. But he is very skeptical that invoking supply side economics would warm the hearts of rights on board. Well, we're definitely living in interesting political times. Chris Connin, thank you so much. Federal Reserve in US Economy reporter at Bloomberg News. Joe Webber, editor of Business Week,

checked out that remarks in the new issue. This is Bloomberg Business Week with Carol Masser and Bloomberg Quick Takes. Tim Stinovic on Bloomberg Radio. Our Next UT's been investing in bitcoin and blockchain technology for almost a decade, founding Perfect Ventures back in It's an early stage VC fund focused on decentralization. So Tim, they're looking at the convergence of blockchain technology, machine learning, IoT and security and a lot more. We're talking Jolic, job and Putra. She's found

her in managing partner at Future Perfect Venture. She joined us on the phone from Miami. Um, Jollic, it's great to chat with you again. It's been a few years since you and I have been able to speak. I mean even even when we we spoke a few years ago. You were early into crypto then, but you've been doing this for for close to a decade. I want to

talk about cryptos moves today. It's something that I spoke about on bloomber TV a few minutes ago when I referenced that bitcoin is higher by ten right now, it's increasingly looking like it's trading like a tech stock, like like Amazon for example. How do you explain the correlation there? Well, in the beginning, we saw bitcoin was quite uncorrelated with

the equity market. In the early days of bitcoin, and part of this story there is that it was created to be a self sovereign UH financial asset, a store of value where government policy would not influence the price action. But as we've seen more hedge funds, corporate treasuries, uh

more institutional investors get into the bitcoin UH market. We've seen more and more correlation there and and so that's where we've seen the price action very much, I'd say over the last couple of months especially, has been very correlated.

Like you know, you've been involved in this space for a long time, longer and at a time when a lot of people were questioning what it was or not really being a believer it's it's certainly gotten a lot more legitimization today then versus where we were roughly a decade or so ago. How should we be thinking about cryptocurrencies were still I feel like trying to classify it

collectible currency, commodity, Like, how how do you think about it? Well, our thesis from the beginning in two thousand fourteen was that blockchain technology, which underpins Bitcoin and what makes itself sovereign and decentralized through its computer network, that this blockchain technology was going to create ten x the value of the Internet simply because they would enable people all around the world to UH to transact directly with each other.

That you can create new assets from being able to fractionalize the real estate a building, and you could turn a fractionalized piece of a real estate building into UH an asset that then can be tradeable um through blockchain

uh technology and networks. So UM we look at it very broadly and and and the reason tokens and crypto is an important part of that is they enable the incentsive network to work properly behind this, this blockchain network and UM and and so we think different cryptocurrencies will serve different purposes. Bitcoin right now has become a store of value uh kin to gold, a digital gold. People hold it when they are worried about inflation, when they're

worried about government policies devaluing uh the local currencies. So um so, so bitcoin has very much fallen into that narrative. Eftherium has been underpinning a lot of the growth of the n f T s. Um it's become currency to to buy these n s T s and so to access the n f T s you need to hold ETHEREUM. So that is serving um you know, a different purpose, its currency in this metaverse world. And we'll see other cryptos that that warm and get established to to serve

different purposes. Just like you know, we don't have one internet company, right we we have UM, we have the Amazons, we have Googles, we have UM infrastructure companies and and so we think that same opportunity UH is going to exist within the cryptocurrency market. What are the opportunities that you're seeing right now at at Future Perfect Ventures. And we should note that you've invested in companies like blockchain, dot Com, the financial services platform, Current other platforms including

Curio marketplace for digital collectibles and arts and entertainment. Where are the opportunities that you're seeing UH when it comes to venture capital, but also where can investors in public markets get into these opportunities? Yeah, so you know, we now have exchanges where it's fairly easy to go in

and and buy different cryptos. You can have direct exposure to to cryptos UM their their companies like the Central Land, UH tokens like the Central Land and Sandbox, where if you believe that the metaverse is is going to be an important part of our future UM, then these are these are tokens that are providing platforms for developers to build metaverse products. So so I'd say any public investor has access to UH to a lot more than they

did in in the early Internet days. And then you can also look at UM larger companies that are are you know, betting big on the future of webs three and that includes you know, companies like Microsoft that just purchase activision. Gaming is a big area where we're going to see um more more activity around blockchain enabled platforms um. Right, and then uh we uh, we're we're excited about all

of those. And I'd say we're excited about the continuing decentralization of finance, right um and and how larger companies will incorporate some of the deep by products. Yeah, we definitely we see a lot of momentum. Come back because I love to continue the conversation with you or running out of time here, but uh, I hope we can return real soon with you. Gellic uh po excuse me? Found her imagining partner future perfect ventures on the phone in Miami. I think she really explained it in a

really clear way. We know now a lot more. I'm roa yeah, but you let me drive? Oh no, no, no no, please, I'll let me. I want to drive. It's good question. Drive. This is the drive to the Clore radio. Alright, ten half minutes left. Okay, we're there. We're getting that. Carol. I'm sorry for you all on YouTube. I'm like Oh, I'm so ready to wrap it up. Uh well okay, well I think the markets are around ready to wrap it up. We're seeing you know, a little bit of

a rally today, Yeah, rally for the week overall. Let's get to it. Let's drive to the clothes with Brad McMillan, his chief investment officer maaging principal at Commonwealth Financial Network on the on the phone from Waltham, Massachusetts. Brad, how are you happy Friday? I am warm, I am crying. I'm calling that away. I know how you feel and how you feel. Um, we're gonna end up. It looks like the week with some gains overall. Yeah, two point six percent on the NASTAC the last five days on

the S, which is fairly decent. I know we're still down a lot from the record highs. How do you come to conclusions after a week of trading like this week? Well, I think, um, you know, the Fed came out and said yes, we are going to raise rates, and the market reacted, and then the market took back, It took a step back and said, but wait a minute. The economy is really doing well, so earnings are going to

be fine. Valuations are a little bit lower, but on the whole, onward and upward, and I think that's where we're going. So where does the FED come into this? And and we we had a little debate earlier with our friends at Bloomberg TV about what the jobs report means for what the Federal Reserve does with interest rates this year. How are you anticipating the FED raising rates by or after the March meeting? Well, I think the FED is going to start raising rates at March. I

mean they pretty much telegraphed that. I think they're going to do it a quarter point and then we're probably looking at May and probably three or four during the course of the year. And the reason I say three or four is the Fed is actually on record of saying and wanted taper policy, but they don't want to shock them markets, and right now they're trying to talk

to markets back from what they're saying. I expect more action on the balance sheet because even Esther George a perma Hawk, has been saying, you know, that's really where we need to make some move. So I think the market is probably saying it's too much in terms of the rate increases, and I think the Fed's listening. What does it mean though, for how we manage our portfolios right now? Honestly, not much when you look at where

stock prices come from, its earnings and its valuations. Okay, earnings are going to do fine, as we talked about. In fact, the one message of the jobs report this morning is people are working. They're going to be spending. So it's all about valuations, and we seem valuations adjust, but most of that adjustment is done. I think right now, if you haven't done anything, you sit tight. What about when it comes to asset allocation, Brad, there, I think you need to take a close look at where you are.

I mean a lot of people have gotten hands hard on some of the growth stocks, especially you know you look at um Facebook for example, or Netflix. You want to start putting money into stocks that are poised to position from growth, but aren't necessarily as pricey as some of the poster children are, because I think there's a lot of risk there as we saw. So go stay with growth, stay modestly overweight growth, but don't commit to the highest profile, how highest valued stocks. Is it hard

to predict how the year will play out. I mean, we've done a lot of reporting, Brad, I'm sure your team and your researchers have taken a look at what happens early on in a rate hiking cycle. It tends to be good for the equity markets. But you know, this is a year, we're coming off of a couple of years in a year and a pandemic that we really don't have the playbook for something we can draw upon to kind of understand maybe what the trajectory is. So so, how do you think about it? How do

you predict it? Because you've gotta make decisions. You do right, man, too money or advising others? Absolutely, Carol, and you're absolutely right. And I think one of the things people get caught up in is trying to predict some of the individual events, which I don't think we can do. You know, that's a fool's game. But if you just take a step back and you look at the biggest picture again, where

are earnings reasonably going to go? Right now, we're expecting them to go up to ten or fifteen percent, so okay, we can expect earnings to go up. Where evaluation is going to go? Okay, if we go back to the pre pandemic, probably the bottom is going to be somewhere about sixteen times forward earnings, which is about fifteen, So that kind of says the market's going to be somewhere plus your minus five from where we started the year, okay,

and there's probably more upside risk than down. So that's kind of what we're looking at as we think about the future. What would you say to somebody with trying to time the market right now? Now? I know it's not something that many people advise doing, but is there going to be a better opportunity to get in? Are we are? We have we hit the bottom yet. I think there's a reasonable chance we go down a little bit further. But I also think there's a reasonable chance

we bounce. So I think it makes sense to you know, wait, if you're going to make that bet, but it is a bet by far. I think the better option is to say, Okay, I'm gonna dollar cost average in. I'm gonna put some money in in case I'm wrong, but I'm also going to save some money to put in later on a regular basis if in fact the market does go down. Where don't you want to be though? Stay away from I think the most highly hyped in priced stocks are the ones that are most vulnerable to disappointment.

You know, I believe in growth, but I suspect there's probably another Facebook working out there, or another Netflix where we could see a significant drop down. So I would be very careful with stocks at or price for perfection. It's interesting, it's not Alphabet, it's not Microsoft, right, we saw that through earnings. Fair to say, it's not Amazon. What is it? It's about growth. You know, when you look at Amazon as an example, everybody's going to go

to Amazon. They can bake in growth by upping their prime cost, which is what they've done. When you look at Netflix, for example, or when you look at Facebook, they are all about the growth in the number of users and when that's often so to their prospects. So I think that's the big difference. Is it a different Are they selling eyeballs? Are they actually minting money? And that's the question. All right, we gotta run. Hey, have a good weekend. Uh take care. We really appreciate your

time as always. Brad McMillan, Chief investment Officer, Managing Principle, also at Commonwealth Financial Network, on the phone from Waltham, Massachusetts. Thanks for listening to Bloomberg Business Week. Download the podcast on iTunes, SoundCloud, or Bloomberg dot com, and you can also listen to our radio show at two pm Eastern on Bloomberg Radio or watch us on YouTube search Bloomberg Global News