Using Smaller Labs for Virus Testing, Mark Carney Joins Brookfield, U.S. Produced Chemicals Fuel Mexican Drug Cartels

Week on iTunes, SoundCloud, ol 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. All right, let's get you going, because we've got some serious stories also going on as we watched that hurricane bearing down, uh certainly on the golf right now. So let's start things off with the check on the trading day and Charlie Palin, Hi, thank

you very much. Indeed, category four hurricane. Now we've got the dal the SMPNZDAC at or near best level of the day. In fact, we are looking at records for in a row now for the SMPN nastac. Let's get right to the numbers. SMP up thirty that is a gain of nine tenths of one percent. That now is up thirty four points, now hard by one tenth of

one percent. Now the stack is up one hundred and eighty seven points, up one point six percent year today column on the Bloomberg up twenty nine point nine percent, ten year yield point six eight percent. Gold is up one percent seven ounce and West Texas Enemedia crude oil now up three tenths of one percent forty three forty barrel. I'm Charlie Pellot. That is a Bloomberg business flash. All right, Charlie, thanks so much. You are listening to Bloomberg Business Week.

This portion brought you by Commonwealth Financial Network. Be the independent advisor you've always wanted to be with all the support you need to get there. Visit common Wealth dot com to learn more. And we got to set the Business week agenda, Harold, because you mentioned that market woa. I mean it is something to behold. Given all the headlines, you run down the most read as we often do, and you just think, oh okay, so stocks are up cool, alright, great, um, yeah,

let's check in with our team if we can. We've got them assembled in the great state of New Jersey. Talking about Gina Martin Adams, chief equity strategist for Bloomberg Intelligence, on the phone from New Jersey. Also there Dave Wilson, Stocks Editor, author of the chart and stock of the Day. So Gina, help us understand this market. And maybe it's just these Tex stocks, but I have to think it's

more than that. With this drive higher, I you know, I think it's more confirmation that monetary policy is going to remain extremely accommodative for a very long period of time. And frankly, that's been the driver from my perspective. That's been the driver since March and it really hasn't changed. You get a little bit of UM, greater optimism that we probably will experience economic recovery which will lead to

bigger earnings recovery into eleven. On top of that confidence of monetary policy remaining extremely accommodative, and nowhere else to go but stocks. You've got to be willing to take a little bit of risk, utilize the liquidity to put that money to work when rates are at zero UM, and so stocks are kind of the sweet spot and I think that the market is reflecting that. You know, the other thing I think is that this idea that this is a one sided, one trade market in favor

of thanks is completely overstated. Actually interesting, the data of stocks in the SPI trading above their fifty day moving average, rights, they're trading above their two hunter day moving ever. So it's blood big. Guys are big, and they keep getting bigger. But there's a decent amount of breaths here. That's I think a really really really really good point. And I also go back to what you said, well, Chause, Gina

deserves a lot of realities. But the point is also, you know, we're going to talk about j Powell and the upcoming Jackson Hole meeting. I mean, the expectations are that the you know, we're gonna have zero rates for a long time, So, Gina, people are going to increasingly be looking for yield, and that is going to take you off into the stock market. Yeah, you've got to find it somewhere. And with spreads tight, with yields across the treasury curve incredibly low, with even emerging market debt

has rallied, there's just not a lot of opportunity. Um for places to put your cash, but none. Nonetheless, you don't want to put it in zero percent earning money market funds, So there there definitely is an incentive to take on some degree of risk. Now, I would not go so far as to say that there's evident tremendous

risk tolerance out there right. If there were, then we would see not necessarily the big defensive tech stocks and healthcare stocks and communication stocks leading to the extent that they are. We would see some of the value stocks starting to really show some leadership. So we haven't even seen that in great scale. That could be what's next to drive us even higher if we can get some economic momentum while the fit's so easy. All right, Dave Wilson,

what's on your mind today? What are you seeing that's new and interesting, either with specific names or things that are driving them market that may not be obvious to mere mortals like us. Well, you know, we've already brought up the fang stocks, and boy, you see three out of the four among the day's best performers in the

S and P five hundred. You know, there's Facebook, which is up almost seven percent, even though they're talking about how changes to Apple's operating system for iPhones and if iPads going to hurt their advertising network, and of course that's where the revenue comes from. A Facebook. You know, you've got Amazon dot Com up about three another day, another adventure for that online retailer, or so it seems.

And then you know you have Netflix and their name is being tossed about as a potential bidder, uh for TikTok. Now whether that happens or not, who the heck knows. Uh, it looks like they've kind of backed away from that possibility, and Netflix is up ten a percent and they all kind of take a backseat to Salesforce dot Com today, which you know, if it were next week and the company was into down Jones Industrial Average, it would be given a serious lift to the town. It's up more

than twenty in the wake of its earnings. Yeah, that's a big bit. You know. It was interesting to talk to Nico Grant about the Salesforces move into the TAO and I was like, so, how big of a deal is this. He's like, this is a huge deal. This is a massive deal in part about what it says about the company, but in part what it says about the space that they're playing in who they're replacing, like the power of that company and how big it's scotten

and how influential it's gotten over time. All right, Dave Wilson, quick tease for the chart of the day. Oh, you know, look at what's going on with the SMP. You think it's all about the mega cab companies, you know, the things we've already talked about them. That group has years right just to overcome and I'll show that with the chart. All right, Thank you both so much. Dave Wilson will catch up with you a little bit later at Gina

Martin Adams. Thank you so much. From it was so important because we keep talking about it's all the tech. It's all on the tech, but we need to think about what else it's in. I might say it's really really, really really important. You would, just because an I did. You're listening to Bloomberg Business Week with Carol Masser and Jason Kelly on Bloomberg Radio. You know, we've been talking a bit about vaccines, but we also know that testing is huge. It's it's huge, especially as we think about

getting back to something resembling normal life. Whatever this next normal is going to be we're lucky to have with this. Ali Dovar excuse me, Ali, am I pronouncing your name right. That's great, Yeah, that's perfect. Thank you good co founder of Atlas. I d joining us on the phone from Vancouver. So, Ali, tell us exactly about what you're doing, because rapid testing and getting tested in in all aspects so important right now. Yeah, I mean testing the broad category and rappid testing is

part of it. Um. What we're doing right now is we're trying to help employers essentially get connected with testing capacity and actually do virtual health checks on employees that need to come back to work. That includes like coordinating testing and also helping facilitate that they get delivery times turn around times such that the testings look useful. So tell us about your role in all of this, because I think this is such a big part of it.

I can't tell you how many times where somebody's like, you've got to get a test, but this place tells me it's going to take you know, two weeks. How useful is that this place is gonna take me a

couple of days. Tell me a little bit about your role in all of this, because you guys are not in the testing business, but you are helping others, other companies, other employers facilitate testing, which we know is so crucial to where we are right now and really trying to help us all get back to maybe normal, maybe get back to work, get back to some things, get back to school, and all of those things. So what exactly

do you guys do? Yeah, essentially, we're facilitating uh, these smaller and medium sized business is that need to get employees back to work to do testing. So that's a real coordination challenge, that's a real facilitation challenge, and making sure that they get access to the laboratories out there that have the capacity to test. So really, you know, the big labs are really uh caught up on public testing and the capacities already sort of add its limit there.

But there's these smaller labs that have capacity and will come online um if they have visibility and are able to connect to the employers. So it's a bit of a matching problem. So we're the coordinator in between, and we're making sure that this kind of this testing gets to the employers that need it. And so tell us about the demand from employers because I know we're looking at a fall where people are, at least in New York City and certainly elsewhere trying to get people back in.

How much do you worry about demand versus supply, both supply of tests but also supply of essentially evaluating those tests. Yeah, we went on in the evaluation business. We let the FDA do that. So I mean, sorry, I mean, not the value. I mean just basically like the processing of tests, That's what I mean. Sorry, Yeah, absolutely, yeah, So I mean demand is gonna spike, I think on all fronts

because that we're approaching the influence of season. But at the same time, we're seeing employers get visibility into the consequences is not testing, so they're looking across at other employers, you know, seeing what happens when an outbreak happens, and that means shutting down the business of liability around that.

And just the nature of this disease is, you know it you can be asymptomatic and spread so that that that happens in about cases and the workplace is one of those places where you you're really you're you're liable to have a real outbreak, So it's it's a real problem. So how much is your business change because of the virus. Well, we have developed a deep technology and we've been working

on it for a while. What we've done, it's essentially utilized this technology to serve as this platform so the data is more private and secure and also facilitates this matching to happen. So a lot of these smaller labs don't really have the technology to deliver the credential, the test results, and eventually the vaccines in a way that employers might want to utilize it. So that means like, so we have film and TV customers that we put

set up checkpoints zones. We have manufacturers that need to display this credential of testing or that as vaccine as that they may come to partners on site. There's all these use cases for employers to use this that these labs are really not set up to meet. Well there's some an email for instance, right, or are they sort of spreadsheet that's just not that's not out. That's how the nature of this problem. So we really are facilitating them getting connected and delivering that data in a way

that's useful for employers. Yeah, Ali, this actually feeds into something Jason, I've had lots of conversations. I mean this whole idea of testing and tracing, but just testing. You know, when you think about the schools and colleges that we've talked to, it's about doing multiple tests, you know, or testing several times a day or several times a week to make sure you know communities are safe. Ali, thank you so much for checking in with us and letting us know what you guys are up to. He's the

co founder of Atlas I d Ali Davar. You're listening to Bloomberg Business Week with Carol Masser and Jason Kelly on Bloomberg Radio. Let's get right to this story. Scott to Vote. I was so fortunate to just ride along with him, sort of like I ride along with you, Carol, you know, and just enjoy the good work that's being done. I did the same with Scott to Vote this week deals reporters so much more for Bloomberg answering the question so many had Scott about where Mark Karney was going

to end up. Brooke feel winning the sweepstakes. This is a big higher. Yeah. I think he's probably the most coveted guy that was out there, you know, um in the early part of the year, at least for Business and politics. UM, there's been plenty of rumors swirling around. UM. You know, in particular after our colleagues broke that uh he was he was doing an informal role with the Prime Minister of Canada, you know, helping with the plan

to recover from COVID. UM. People started thinking that maybe he would replace the outgoing finance minister, but obviously that did not take place. I mean this is so what does this do for him? What does this do? Um for the private equity firm Brookfield. So I guess the big thing will be that he is going to lead a new initiative to basically build a new stilo for Brookfield that will do E s G investing, so focusing

on environmental, social and governance issues. UM. And you know Brookfield has basic for stylos right now in renewable energy, infrastructure, property and they have a private equity arm. So the idea would be too, he's going to oversee this new vertical for Brookfield UM. And they think it's going to be you know, as big as any of the other verticals, which ranged from fifty billion to eight six billion. I believe in assets under management UM. And so more importantly,

I think. Um. What Mark told us Jason and I yesterday was that um he was, uh, you know, looking for something where he could marry some of his passions. Um. You know he's been a big climate change um you know, um proponent and also for businesses. Uh that aren't you know, getting on this climate change and initiative he's been you know,

quite critical of So he'll be able to do both. Yeah, I mean, Scott, what struck me as you and I were catch ing up with Mark Karney and Bruce flat the sea of Brookfield esterday and sort of understanding what was behind all this really was the size of the opportunity. And one of the things that you and I and Carol have all learned and watching this business over the past few years is that the scale and the ability

to do really big things matters. And that's what's ultimately and I was glad that you really pushed this to the fore in the story too. That is what has made Brookfield so competitive and now really only second to Blackstone when it comes to the world of alternative assets. Big investors are looking for investors who can put lots of money to work, and that doesn't exist in this space right now. When it comes to E s G. Yeah, I agree. I think that was one of the things

that jumped out at me. I think Bruce Flatt said something along the lines of, you know, in terms of the kind of funds that they're thinking of raising, there's only been a counter fifteen billion raised globally at UH for similar funds, and he thinks it's hundreds of billions of dollars sitting on the sidelines looking for something like this. Yeah. I do wonder if like we're at, you know, a

turning point. Scott Jason and I've talked about this, but when it comes to E s G, I do feel like, all of a sudden, you know, some of these bigger players, these all asset type investors to are just looking at E s G in a very different way and really kind of like E s G has grown up. Yeah. I think that's probably true because if you think about um, you know, the constituents of you know, the pension signs and um you know even you know, even some of

the big asset managers, UM. You think about who's who's putting their money into these kind of um UH funds that Brookfield would be raising, and these people are people that have been you know, pounding the pavement about you know, needing to fix social issues, environmental issues, and they want to put their money where they can trust um that they'll you know, they'll be getting a good return, but they'll also be doing good generally for you know, the

modern society. A lot of these implications. If you don't now whether it's legal total, it's the impact. Like you, you know, you can cost your company a lot of money by not um falling in line with this stuff. So cool. Good to work with you on this one. Scott to Vote Deal's reporter for Bloomberg, breaking the news that Mark Karney's going to Brookfield. I have to say, Carol, I have to think that Steve Schwartz and Henry Kravits and others are like book Field. They got him. You

are listening to Bloomberg Business Week, Jason Kelly and Carol Masser. Well, this next story, it takes us to Mexico, but by way of London, because that's where we find one of the reporters involved in this Camp Simpson News Projects and

Investigations reporter for Bloomberg. We find him in London, along with in Massachusetts Joel Webber, the editor of Bloomberg Business Week, all about a story the US drug crisis is made in Mexico with American raw materials, Joel I have to say, this story is really I don't know what any other ways, it's really disturbing, super disturbing. And tons of credit to Cam for really sticking through this. Uh, he's been working on it for a long time, which I'm sure he

can tell us all about. But you know, the main thing here is, you know, obviously we're in the middle of a pandemic, and we've just done vaccine issues, and that's a story that you know, we're I think is

is here and now. But let's not forget that there's this unfolding epidemic that's been going on for more than a decade now, involving heroin and meth and the and the kind of the most salacious thing that Cam's discovered in his reporting is that US companies, um one of which is publicly traded, are actually making the raw ingredients

that Mexican cartels are exploiting in Mexico. You can't they can't obviously make them in the US, but they can make them, uh, their subsidiaries can make them in Mexico. That's where they've been rated stolen there in jugs. They can actually just be bought over the counter even and those are fueling base weekly this ongoing epidemic. Cam. How did you find out about this story and and what what makes you so frustrated about it? Yeah? Thanks, jo

Um Gosh. Well, you know, the space that I've worked in for the last couple of decades is sort of the blind spots created by globalization and you know, transnational illicit trade. All kinds of things happen, you know, especially with corporations in these blind spots, whether it's human trafficking or whatever is in your supply chain that that you

don't want to look at. And I think probably about gosh, it's been probably about eight years ago I read a journal article about the trafficking in this this chemical, So you have all the heroine that's ever been made in the world has been made with a single chemical. It's required to make heroin. It's called a cetic and hydride. When it was initially discovered in eighteen seventy four by an English chemist, he did it with this chemical called acetic and hydride, and so it's it's for the last

twenty years been the heavenly regulated products. You can imagine in the international trade under international drug laws pushed by the US all over the world, it's incredibly restricted, and you know, I read about in Afghanistan it's completely illegal. It's a crime to even have a leader of this chemical because there's no legitimate ustward in the country and

it's all based on smuggling the entire market there. And then, you know, come about two thousand and seventeen, when I realized from my post here in London where I do work on international stories, that that there was this horrible heroin crisis in the US that had really kind of

moved in on the prescription opioid epidemic. After prescription opioids were made harder to get, you know, through reformulation, there's been almost a one to one replacement in terms of overdose deaths from heroins to the Mexican cartels really moved

in quickly and quite silently. I don't think people realized how much their production was growing, you know, four or fivefold, along with a four fivefold increase in overdose desks over just you know, a very few years, and it kind of clicked in my head that I had studied this issue a little bit in the past, and I thought, well, that's interesting. I wonder how they're getting all the ascetic

and hybride that they need to make that heroin. And it turns out it was completely effectively totally unregulated in Mexico, and the market there, the supply is totally incompletely dominated by US companies. As Joel said, they operate through subsidiaries in Mexico, so they're effectively insulated from the international drug laws and really tough US drug laws that deal with the same chemicals that have been around for you know, for three decades, and and no oversight obviously, um from

US officials. So it's kind of greening this weird, surreal free market in Mexico. That's where it's fueling the entire US epidemic, and heroin and meth uh in this chemical and a pretty lax environment and others. They're even you know, quite strictly controlled at least by Mexican standards. UM. So that was really was really the basis, Tim, what's the

role of tobacco companies and all of this. It's really interesting that you asked that, Carol, so I think probably, um, you know, by far, the biggest use of this chemical ascetic and hydrides throughout history has to been maked has been to make cigarette filters. And the companies that dominate the market globally and also dominate the industrial market for it in Mexico. You know, they're largest source of revenues over the years, and they're they're all publicly listed actually

selling East and Eastman. Their largest source of revenue by far and away has been making cigarettes hilters. So they have they have the vertically integrated supply chain. They make the chemical, they use it to make filters, and then they sell excess in the market to to other customers for other uses. And so I think in the very beginning when the US the CIA made a discovery in

seven that was really embarrassing to the chemical industry. They found that of the chemicals that were making Colombian cocaine, cocaine from Latin America were exported there by US company and these companies that and known honor system before that. And then Congress was kind of like that that we've had enough of this, and they amended the Drug Blow

to really clamped down on this trade. And but you know, there's always from the beginning onto the US law been this really light touch regulation of a scetic and hydride. But I think just sort of survived as a default in Mexico long after, you know, the laws just about

everywhere else changed. The international drug laws again were updated in two thousand one, and this was made the top priority to to really control this chemical, and Mexico just you let it go until until I think the rule was published on Christmas even two thousand and eighteen, and even since then it's still unbelievably easy to get. You know, we bought this this weird retail market in Mexico where you can buy this chemical and eighteen weater jugs. The

man dominated. It's dominated by a US company called Avantur, which was the second largest i PO on Wall Street last year, and they've got about a twelve point three billion our market cap and they sell thousands of these drugs in Mexico. And it's just it's small enough to load into the trunk of a car, but it's big enough to make really lucrative quantities of illegal drugs, especially heroin.

We found it in crime scene photos that we got from authorities at heroin labs, and each one of these jugs can make about nineties hits of heroin, pure pure white heroines. Wow. I mean we bought it over the counter. We had it delivered to us on Mercado Libre, which is like the kind of Amazon and Latin America. All the retailers, all the distributors said it was unbelievably easy

to get. It's just this crazy, wide open market. And and again, I guess what was shocking is that it was really it's a market really dominated by US companies, right, yeah, now that really is that clearly is a twist. All right, Cam Simpson, thank you so much. Projects and Investigations reporter for Bloomberg joins on the phone from London. A terrific piece of journalism. US drug crisis is made of Mexico with a American raw materials. That story will be featuring

the upcoming issue of Bloomberg Business Week. You can read it now on the Bloomberg terminal and of course at Bloomberg dot com. Carroll Well in this week's Bloomberg Green Segment, Bloomberg News Labor reporter josh Idolson takes us deep into the U S mining world and the comeback that never was and the workers that have just been caught in all of this. Josh joining us on the phone from San Francisco. So, Josh, good to have you here with us.

I feel like we all know the coal industry is a dying one, and yet there are still workers in it um. But it's not easy for them. And I feel like they keep getting made promises, um from various individuals and then they're just disappointed over and over again and they've got to kind of rework themselves. Yes, part of why we did this story is Black Jewel became

international news. Harlan County, the iconic US coal county, came back into the headlines a year ago when miners physically blocked tracks to prevent their bankrupt company from moving coal out that they said they had mind without getting paid for it. So the question for this feature was, well, what happened after that? Because that protest united the miners,

but that bankruptcy ultimately dispersed them. It dispersed some people out of the county, and it dispersed other people out of the coal industry into things like trucking or meat packing or getting into nursing. I talked to a man who said the machismo factor would have prevented him in

the past from moving from mining to care work. But he spent a bunch of time around mail I see you nurses when his baby was in the i c U. And it shifted his perspective and now he sees nursing as a more promising way to be able to care

for his family than clinging onto mining. And so what happens when there is a green element that that comes into this, how does that play in Josh in terms of potentially some new opportunities because that has itself long been held out or maybe of late been held out as as a promise of swords or as maybe a way forward here tell us about that. That's right. There are voices saying this is not something that one person or one county can solve. In fact, it's a societal responsibility.

And what's needed to create equally or better jobs is massive investment and the federal government should be doing it. And so people advocate for trillions in spending to do things like provide benefit and pay parity, create government jobs that people can take over, invest in in support infrastructure change, federal procurement to incentivize placing work in some of these former coal counties. There's plenty of work that needs to

be done in America. There's work remediating environmental damage from coal. There are solar panels to be installed, their kids and elderly people to be cared for. And so it is in part a question of will of whether the government will step in to make the decline of this industry that has had tremendous social cost not itself be something socially devastating for a bunch of people, right, because it's not people who don't want to work. I mean, they're

trying to reinvent themselves, but it's not so easy. And you do wonder about what the government could do or their responsibility to help in this situation, because ultimately, you know, people who have jobs, people are working. First of all, good for them and they can support themselves and their families, but it's also and good certainly for their mental health, but it's also good for our overall economy bottom line.

One of the things that was striking and reporting this story was talking to the judge executive, the head elected official of the county, who talked about the surveys that they've done that these miners who in some cases had the opportunity to make a hundred thousand dollars a year with overtime in the mind in surveys said they would accept jobs for as little as seventeen dollars an hour.

And yet when he's had companies come visit about building in the county, one of them, he realized it wasn't going to work because the way he put it is, they only have so much flat land in an eight dollar an hour job is not something that's going to improve people's fortunes there, right, all right, Well, it's a nice piece of reporting, uh stark. In many ways, as all of the disruption continues to hit the whole industry and green it could be a way out, but it

is complicated in many ways. Josh Idolson, thank you so much. Nice to catch up with you, labor reporter for Bloomberg, joining us on the phone from San Francisco. You can read more stories on climate news, science and the environment at Bloomberg dot com slash green Girl. What's really interesting about this story is, right we talked about we see the headlines and it's we just all feel so removed

from it. But what joshed us so well, um and this story in particular, like takes us there to understand the struggles of these individuals who have been in an industry for a long time. It's like, Jason, if you know, we as journalists, and certainly there's other things we can do, but all of all of a sudden, it was just I mean, a dying industry. Dare I say, but you know what I mean? And then it's like, well, okay,

I've got to you know, figure my way through. I mean, it's it's we can't just keep leaving people behind, right roam journal Yeah, but you let me drive? No, no, please out the Dalles. I want to drive, Just drive baby, good questions trying. This is the drive to the Globe community. Thanks, we'll drying us down on Bluebird Radio and it's time

for the drive to the clothes. Let's check in in Los Angeles with Charlie Rogers, regional chief investment Officer for Abbot Downing that, of course, is a division of Wells Fargo Asset Management. Charlie, Really nice to have you here with Caroline myself. Good afternoon. Thank you for having me. It's our pleasure. So you know, it's interesting we are looking at a market that continues to defy gravity when

it comes to the equity market. You know, we see a lot of enthusiasm when there's a good vaccine headline or when there's some indication of an economic recovery. I have to ask you, like, how do you read this market right now? What's the thing that maybe folks are missing or that's going underappreciated. Yeah. You know, one of the things that we're obviously focused on is the upcoming

presidential election. We're just about three months out. So far the markets are taking that in stride, you know, as I loved this morning. Uh website has Biden, you know, with an eight eight point four percent lead, no no noticeable bounce coming out of the virtual elections. So I think for the first time of late, we're starting to hear some questions around uh, you know, what are the policy impact of a potential of resume change and uh you know here in California there's there's talk about a

wealth path and and whatnot. So uh, you know, our view is the elections we should not come front and center where they normally would. At this point, we're going to start to hear more and more about that, and the focus is going to be on you know, policy impact, how much of those are considered less growth friendly and what is really the reaction uh, you know, going forward with the markets. But so far that the focus has

been on you know, improving economic highlights. Uh you know, COVID numbers are trend be down again and and uh you know, salesforce had a great number today and we hit new new highs again right there. Letting go of workers too though, And I do wonder, you know, what the economy looks like, um for the rest of the year going into one when there's pressure still on companies, you know, to maybe cut back because there isn't demand you know, out there, because we're not quite through the

virus yet. Yeah, I mean I think that the challenge there is, you know, what what number do you look at you look at the where we started the year unemployment GDP, and and where we are now and and and how far we're down or what I think the market is focused on is the trends improvement there, so whether that be employment. Uh you saw the housing number last week was up twenty plus percent. I think the market is looking forward and likes you know the fact

that we've gotten really better data than expected. So in some ways that's hard to believe in the middle of the pandemic, And we can all point to sectors like hospitality where where they're you know, there's real challenges ahead areas in real estate, et cetera. But I think the market is focused on the fact that data has been better on the margin, and as long as that trend continues, we kind of supports the highs that we've been hitting

almost on a daily basis. But Charlie, what does it mean when a company like Salesforce, as you mentioned and we talked about certainly yesterday after they reported after the closing bell that they have a banner order and yet they're cutting about a thousand jobs at least according to our Nico Grant uh and according to those people familiar.

So when a company is still doing great and cutting workers, you know, what does that say maybe about the outlook and potentially what it will mean, you know, ultimately for the economy and then investments companies. Yeah, I think, look, those those jobs are going to have to be picked

up somewhere else. I would say a counterpoint to that, if if you sell the Amazon quarter, I believe if I have the number correctly, they hired something like a hundred and seventy five thousand workers in the second quarter, which is just a staggering number. So there's clearly been winners coming out of pandemic. It's easy to kind of look at the tech sector, Salesforce, Amazon being two big examples.

But for each uh you know, cut that we've seen, like Salesforce, there there has been some positive corporate news like Amazon, you know where where they're aggressively adding adding workers. And as long as those kind of trends uh continue and those kind of roll up into the uh you know, frankly better employment numbers than that expected, I think you're going to see uh you know, that continued tinued up trend and you know, we gotta we gotta get get

employed back to more normalized numbers. And you know, it's our expectation into twenty one that that will start to see those those jobs come back. So, Charlie, we were talking earlier in our show about a story that I had a hand in, which was about how Mark Karney, the former Bank of England former Bank of Canada chief, is headed over to Brookfield head a whole new investment area for them around E. S. G. It'll be a

mix maybe a public and private type investments. But I do wonder as we think about these private capital juggernauts like a Brookfield or a Blackstone, KKR, Carlisle and others, are those opportunities for for clients sort of the broader private market which has only gotten bigger and bigger here. Yeah, actually, uh,

I think that's right along the lines of what we're thinking. Uh. You know, our discussion up until now is about the public markets and the and the new equity side high as we're hitting you know, we actually think it's a it's a great time to be looking at the private markets. And you mentioned some of the category leaders there, so you know, one of the one of the deals that

we're looking at now is a private debt opportunity. The discount for small and mid mid companies which really don't have access to the debt markets the way some of the bigger companies do. You know, cash flow on that, I think it's north of six percent. You're buying bonds at any cents on the dollar, So cash flow plus upside in the zero interest rate environment, I think that's an extremely good risk reward. And the names you mentioned Cake, they all are, uh, Apollo, some of the big debt

companies should should benefit from that. So I do think you're gonna share to see those trends playing forward. And and you know, private deals they held up better on the downside March and April and and and public markets would come roaring back. But but uh, you know, going forward, and we think, you know, this is a great time to be looking at you know, those private investments. Yeah. Interesting. Yeah,

Aries is another name. I know we talked about a lot when it comes to the private credit and the private debt market headquartered out near you. All right, Charlie Rogers, thanks so much, Regional Chief Investment Officer for abbot downing. He's done, just on the phone from Los Angeles. Carelly see how it was able to sort of slide in my story. Very subtle, not so subtle, No, no, well to think so well do Thanks so much for listening

to Blueberg Business Week. Download the podcast on iTunes, south Cloud, Blueberg dot com, or wherever you get your podcasts. And of course you can always listen to our radio show at two pm Eastern bloom A Radio, or watch us on YouTube by searching Bloomberg Global News