Vaccine Front-Runner Months Ahead of Competition

Business 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. Well, the coronavirus, Jason, you know, initially, I think we thought it was the great equalizer, meaning everyone was similarly at risk of getting it. We learned very very quickly that was not the case.

And we have a great guest to get into that we do really happy to have with us, Amelia Simonova. She is Associate Professor of Economics and Health at the Johns Hopkins carry School of Business, joining us on the phone from the nation's capital and Amelia, it's really nice

to have you with us. You know, often we're taught working to some of your colleagues over at the Bloomberg School of Public Health, which of course is supported by Mike Bloomberg, the founder of Bloomberg Philanthropy's and Bloomberg Galpy, the parent of this station. But it's a good reminder of the economic impact of this virus that we also should be so concerned with that disproportionate effect that Carol

alluded to tell us what the data show. Hi, Carol and Jason and everyone in Bloomberg unis thank you for having me um Um. This is a great question. We do talk a lot about the public health impact feature of course foremost and most important, but the economic impacts are also catching up with us and not gingful seed

those economic impacts from fold for this repeable future. Now a comics they're talking about the piece of one year to one and a half maybe two year horizonal or which wasson a seat um, the impact of the coronavirus epidemics, and you mentioned just like the public health and the health and as disproportion and there not, it's not the great equalizer. On the contrary, it seems to have exacerbations

already existing this one and dificality in the population. So the economics compact are not the same across or different states, across different demographic groups, and they won across gender. And what we have found is that, you know, there is a lot of structural reasons for that, and I'm happy to talk a lot more about that, Amelia. Let's get into it, because right we have found out that you know, Blacks Latinos are impacted much more severely because of this.

In a lot of times it's because some of it has to do with their own health situations, but it also happens to do with the kind of jobs that they're doing. And I think what you also get into, and some of the work that you've done is occupations in certain cities and state, right are certainly going to be affected by the amount of different types of populations

within that state. Absolutely. And the one act think that we have booked at is how well can occupations be performed remotely and in a in a in a situation of social distancing, be at a complete shut down where everybody is staying at home, or just you know, you can't go to the office every day. You can go every third day or any of those. It matters a lot who can do their work from home and who can do it well um. And it also matters how

this affect your mobility. And we do have data and we have studies that show to have um there's big differences across economic social demographic groups. Right, Black and Voltinos, the Native Americans are much less likely to be in jobs that can be performed remotely compared to what's an Asians. And these are the group that will have looked at because that's what's available. But it's exactly agree with what

you're saying. So we do have these their underlying that's how the economy is and uh and and this is before COVID hit COVID dominating to work and so Amelia. When you look at how this will manifest going forward, how soon will we see the economic impact of this or are we already seeing it disproportionately when it comes to these different categories. So we we are already seeing the impact. And you can you all know the unemploymant numbers. We are an instituation a really hard imployment um UM.

The numbers are not exaggregated by by racial groups or at least you don't have deficial numbers. I think when we see those numbers will be conformed, but by what we've been talking about will be confirmed. What we do see is we have differences in the impact of uh OF of unemployment compared in different states depending on how teleworkable or how I able our people in those states

to perform their jobs. And in states where you have fewer people able to perform their jobs remotely, you have higher and employment um and spaces where more people can do them. You have law on employment right, so you can you know, draw conclusions. What do you know what? I just want to jump in. I think what's interesting about this work, especially in a day when we are hearing from Nancy Pelosi or David Weston caught up with her how speaker and we're going to hear a little

bit of that conversation shortly. But you know, when we're trying to figure out relief, it's just a reminder that not every city has impacted the same, not every state has impacted the same, And a lot of it has to do through demographics, you know, because that composition has determined kind of who has been impacted most by the virus. Maybe because they couldn't find work or what have you, and may also tell us a little bit Amelia about the kind of relief that maybe needs to go to

certain parts of the country specifically. Well, I can tell you that there's very big differences a class space. For example, in Washington, d C. Where I leve, more than sixty percent of occupations can be performed remotely, which means that traffic went down substantially, traffic kinds of traffics. People just stayed home, and even when they started reopening, people did not go back to work because they didn't really have to.

But in the place like was Virginia more like slowly persental drops can be performed remotely, and so even if you if you shut down stuff, people will still have to go to work because they're considered in essential professionals. So traffic doesn't go down as much as it should be. And then when they start reopening, everything is going to under start the opening. Everything is going to go back

and exceed what has been happening before. If we draw a power between traffic and infection rates, which which is still to be proved, but there's some evidence there that suggests that that's the case, you can imagine what's happening with the infection rates as well. It doesn't go down as much of the chili r gonna go up more. I want you all right, We're gonna leave it there. Unfortunately we're running out of time, but thank you so much.

Amelia Semenova, Associate Professor of Economics and Health at the Johns Hopkins carry School of Business, showing us on the phone from Washington. The cover story this week is so timely. It's by Bloomberg News senior writer Stephanie Baker. She has been one of those reporters who has given us all a front row seat when it comes to the virus. She joins us right now on the phone from London, along with Bloomberg Business Week editor Joel Webber on the

phone in Massachusetts. And I feel like Joe, I see this book by Stephanie in the works COVID nineteen, my first person account, because she has just done some incredible reporting on all of this. I mean, she did incredible

reporting all the time, but especially on this one. Um. And you know the I think that the slight difference here it was like this particular story is not quite as much of the first person story as some of the other ones, but it's about probably the most in my mind, one of the most important people in the world right now, who's an Oxford professor named Sarah Gilbert who has basically been toiling away on VA vaccines for coronavirus,

is never getting any attention. She had, uh, you know, the effort that is she's is sort of the culminating effort right now. Began actually with a bola and then she went to Mers and Lo and behold, at the beginning of the year, all of a sudden, a coronavirus pops up, and suddenly we have a person who had been working on a very similar project and was able to pivot and basically changed some of the approaches that

they were looking at. But there she is, months ahead of where we think other people are in terms of maybe being able to have a viable vaccine. And Stephanie, UM, I'm just really curious. What what is she like? What is her Gilbert like? Yeah, I mean she's really interesting. I felt a bit like, um, a pestering student asking for you know, what the next homework assignment would be.

You know, she had extraordinarily sort of focused and efficient and conscious of keeping her eye on the prize in terms of not wasting her time, you know, on things that are not relevant and that it's just it comes across in every interaction I had with her. Um, you know, she's a serious minded scientist. Um. And she knows that, you get the sense when you speak to her, she knows that this is her moment that years of research might finally pay off because of a sort of confluence

of events. Um. And you know that she needs to, you know, really just keep on with it, keep on top of it, and take one challenge at a time to try to you know, sort of push this thing forward and hopefully across the line. Um. You know she's a scientist. She's not she's not a warm and fuzzy person. She's she's you know, but I wouldn't want I would want someone to be as serious minded as she is. Um. If you're looking for someone to save us from this

mass so so, Stephanie. There's there's dozens, I think in the hundreds of efforts now under underway to actually get this vaccine. What makes the Oxford approach different than some of these other ones, including you know Maderna came up yesterday as one that the market got really excited about. What what is Oxford's approach here? Yeah, I think that

one of the biggest differences is the safety profile. And you know, we'll find out more about the Oxford vaccine when they report preliminary results from their Phase one trial on Monday. UM. But all along UM, Sarah Gilbert has expressed, you know, confidence in the safety profile of this vaccine that they tested it in something like twelve different vaccines.

In these vaccines haven't one approval, but they that that platform, the technology that she's using, has been in thousands of people already, so they have a fairly confident sense of you know, what the adverse event you know, profile of this vaccine would be, and they're they're quite confident that that's not a huge hurdle. And I think, you know, some of the results that came up from a Darrena there,

the adverse event profile did take some analysis by surprise. UM. And if you think about we need a vaccine for not millions, but potentially billions of people. If you've got five adverse event profile and you multiply that by the number of people that are going to need to have a vaccine, that's huge, right, So we need something that is safe primarily to be able to roll it out

to a large number of people. And so Stephanie, as you were talking to Gartan, as you came to understand this, and and as Carol alluded to, you have done such a great job on this particular project, as you always do of sort of taking the whole view. And it has been a personal story as you have helped us understand from a consumer and a personal perspective, how this

is all working. What's your sense of how scientists are working together, the collaboration, because you know, we've been talking to a bunch of CEO as we talked to the VOS CEO and others. I mean, everybody's racing for this. There is obviously an element of like wanting to literally save the world, but there's also a sense that beyond heroic people could be this is when we're after all wildly successful. I mean, this could be a game changer

on an economic and financial level too. Yeah, absolutely absolutely. I mean obviously it's extraordinarily competitive, you know, I think, um, you know, there's a there's a race to get their first Um, you know, I did look at, for instance, the last the polio vaccine that was developed by Jonas Salk, who was you know, you know, given banner headlines as you know, the one who saved the world from the

stability disease polio. You know, I've also often thought that whoever gets to a vaccine first in this case, even if it's not perfect, we'll be kind of the Jonas Salk of our times. Um. I think there is you know, even with the competitive nature of this, I think there is collaboration among scientists, and you see it on social media, and you see it in through the research reports. And one of the things that Sarah Gilbert said to me is, you know, no one knows how strong the immune response

really needs to be to achieve protection in people. You know, we don't know the levels of neutralizing antibodies or T cell responses. But once one vaccine developer gets a result on what those levels really needs to be need to be, and what those levels correlate with the level of protection, she you know, she said, the whole field will gain

from that. They'll know what they're aiming for. Um. And in that sense, I've often thought, looking and talking to scientists on this, this is just such a huge boon for science in general. You know that you know, a we're appreciating what they do more um and realized how important it is, and you know that you know that this will eventually have a huge positive effect. To think. In the end, I have to say, Stephanie, your story is and I do mean it like you've given us

a front row seed. And I feel like every time Jason and I and I'm sure Jill feels the same way. You know, we read something from you, We learned something more, much more detailed when it comes to either antibodies or this process of what it takes to get a vaccine done. Um, I just always feel so much smarter. So thank you

so much. It is the cover story this week. Our thanks to Bloomberg News senior writer Stephanie Baker on the front runner who is months ahead of our competition when it comes to getting a COVID vaccine, And of course, our thanks always to Bloomberg Business Week editor Joe Weber. This is Bloomberg Business Week with Carol Masser and Jason Kelly on Bloomberg Radio. All right, so let's talk a little business week economics and now it was a big day for data. We talked a little good, some bad,

some good, some bad. So let's figure out what it actually means. Uh, we're saying good afternoon to Elena Shall let you see new US economists for Bloomberg Economics journeys on the phone from Long Island, Helena, how are you good afternoon, Jason, very good, very well. And there is some good data, there's some bad, and that highlights what

is going to happen to the U S economy. I think the good ones retail sales obviously for the months of June, but back in the past the data sale and the stubbornly elevated levels of unemployment benefits telling us that the economy will not be able to continue to

recover on it sold. The economy is approaching a cascade of cliffs, including the exploration of unemployment benefits in the top up of six hundred dollars, and the Payrolls Protection Program will stop accepting new applications in the beginning of August. And on top of that, we are getting um the a lot of different mortgage forbearancepluence by expiring as well. So you know, the consumer may find themselves between the

rock and the heart place. So for the post of next several months, with delayed statements coming do and no money to say them. I mean, we cannot underestimate, right Yelena, how important these relief programs have been for supporting the economy. I mean it's we know GDP not great, we know that, but imagine without these relief programs how much worse it would be, and without these relief programs, how tough it will be to get to a really strong recovery or

stronger recovery. Absolutely, the robustness of the recent data is by no means an indication of UH, the economy that can recover on it soul. Instead, it's a testament of the timeliness of the unprecedented policy response and actually the need for more. So I think UH Congress will agree on it on extended aid by the end of the month, but it will be slightly less generous and with an intention to incentivize people to go back to work if theres work out there. Yeah. So, as an economist, how

do you view that? I mean, taking it strictly through sort of a data lens, knowing the models as well as you do, talking to your team like you do, Elena, what what is the right policy response? Here if you were to design it, so the six hundred dollars top up to unemployment benefits in many cases succeeded UH the previous paycheck basically when a person was employed and people

started getting more than they were before the crisis. So adjusting and calibrating this additional unemployment benefit would be tremendous help going forward. So on the one hand, you need to incentivise people to go back to work. On the other hand, you really need to compensate a person who is not responsible for losing this job just simply because of what happened and the support income going forward. So UH, topping unemployment benefits that a hundred percent of the previous

page chip would be one solution. Cutting it in half, I mean cutting in half six hundred dollars um, say take a top up of three hundred dollars would be an easier solution, but in some cases it will not be well calibrated. Right, you know, there's a bunch of FED speakers. You go on the Bloomberg right now on all type dot com, you're gonna see, you know, a bunch of statements UM and events where a bunch of the FED presidents are speaking different events, if you will.

And you've got the Atlanta FED President Raphael Bostick. He's saying that the US economy leveling off amid the virus outbreak, and he says, you know, real time data, real time data that they are getting today is suggesting again that leveling off in terms of level of business activity, in terms of the amount of jobs that are being returned

to the economy. You know, he's just talking about nervousness exactly to what you're speaking to Lena about these relief programs that if they don't come, or if they're smaller, or if there's delays. Uh. There's another one by the Chicago FED President Charlie Evans says he still expects positive economic momentum in the second half. How are you guys

calling the second half at this point? So, yes, you write this a lot of policy speeches right now, and it's it's very hard to keep trackle but the whole idea. Actually there are a lot of uh simula themes throughout all the speeches, and it's it's about the topic of uncertainty. So the uncertainty is extremely elevated. This is something that little brainer the board member of forms of the fifth

highlighted yesterday. Policy uncertainty and economic concernity is extremely elevated, and in this environment it's very much up to the policymakers loanmakers to keep to provide that bridge going into the second half of the year, going into the time when the health crisis is over, and it will be over, but in the meantime, the policy support is absolutely essential. Yeah, to catch up with you of the day, don't you think, Jason, what's that we need more relief? Yeah? I think so.

I mean, certainly we heard it from How Speaker Nancy Pelosi and and I think you'll animated a really interesting economic case and also helped us understand some of the contours of this. And part of the debate is what is the amount and is it just you know, you cut it in half? Is that sort of too essentially um not dull, but but not sort of nuanced enough to to really help solve the problem? Big question, right, And I think House Speaker Pelosi saying, you know, you

gotta it's gonna be targeted. It's got to get to the right groups of people and states, municipalities. I take another element we didn't talk as much about that but we know that that is being debated as well. Elina shall let you with thank you so much. I was good to catch up brother a journal now. But you let me drive? No, no, no no, no, honey, please, I'll do the right rivel. I want to drive, just drive. Good questions trying. This is the drive to the globe.

On to me a thing radio, Yes, indeed, time for the drive to the clothes. Got Collier is with us e CEO and c i O at Advisor's asset management. They've got I think approximately twenty seven billion in assets under management. They focus on the fixed income market. He joins us on the phone from Monument Colorado. He's gotten nice to have you here on this Thursday. Tell us a little bit about Colorado though, and how things are going in terms of the virus and how it is

for you personally and professionally. Well, that that's a big question. Today. The the governor instituted um mandatory mask wearing in all public places. So up until now it's uh, you know, it's been maybe phlf the people wear masks in public

places and stores. But as of midnight tonight, everyone will wear a mask as far as cases and spread in Colorado, really has not been nearly as bad as places that are farther south, So knock on wood, we feel a little bit lucky that way, but you know, it's it's a very big concern. It's a very big concern really no matter where you go. So professionally, you know, we have offices nationwide, so they're all in different areas and experience different levels of problems, but all in all, everybody

seems to be operating well. Most of our people are operating from home. And so as you look at those headlines, both locally and nationally through an investor's lens, Scott, what does it cause you to think about? And maybe more importantly, how has your view changed over the last say, three to five weeks while we're talking long stretches of time there, Jason, Um, so, really, my, you know, the outlook really, I don't think has changed as far as an investor over the last three to

five weeks. We've continued to see a slow but bumpy opening of the economy. And I think we have to remember that we've had pandemics even in this country. Um, you know, maybe maybe not so many in the last fifty years, but you know, I can even remember polio growing up, and and uh, you know, really the fear that that caused. We never shut the economy down ever. Ever, no matter what the pandemic was, there was never a hey, everybody go home, we're going to shut the economy. This

economy wasn't broken. It wasn't broken before we started. In fact, it was really kind of on fire. We just turned it off and then what we did is applied about three trillion dollars worth of stimulus. Now we're opening it slowly, and granted we're having a tweak back a little bit. Restaurants and bars, you know, they're bearing the blunt of it. But once again, I think, you know, we've learned a lot from Asia and that is masks work, and and so you know, we have a large presence down in

Texas there now mandatory masks everywhere. Obviously they they've had a bit of an outbreak. You're going to get those bumpy spreads as we try to deal with it. But ultimately, I think, you know, everybody is focused on vaccines and therapeutics. Vaccine would certainly change the outlook for everybody. As far as markets, you know, we've seen a tremendous recovery obviously sends the lows on March. Interesting. We're starting to see

leadership changing. I think today's markets a great example of, you know, kind of the u UM the winners that have been here to date, uh, those those are beginning to roll over a little bit since the bottom on Marche. We've actually seen leadership in places like energy, which we're like, wow, where did that come from? Materials are strong, technology is still strong. UM. But that's kind of what you would normally think about in a recovery. You would think about

kind of those cyclicals beginning to outperform. And that's that's kind of what we're seeing at this point in time, and we think it will continue for quite some time. Yeah, you're pretty optimistic. It's interesting. On our planning call this morning, we were our producer Paul Brannan kind of sharing with us some of your thoughts. I mean, you think a proper recovery could materialize earlier than we think, correct, I do.

I think, UM. I think generally the population, because they've been sequestered at home and properly scared out of their their their wits. I think the business cycle is different than the the safety UH concerns maybe of of the general public. And I think the business cycle is returning faster than most people would think. Um. And I think we're seeing that in the data we're seeing in retail sales.

You know, we didn't get a bad number this morning and on a employment claims, but generally the employment reports since the bottom have been absolutely astonishing, I mean astonishing. So we think that probably continues. What do you mean astonishing, You mean astonishing in a bad way, you dell astonishing in a good way. We know, putting a larger number

of people back to work than any of the analysts thought. Um. Now, whether that can we still have we still have seventeen point three million Americans claiming ongoing unemployment benefits and state programs. That's uncorrect. That's a lot well that is. But on the other hand, I think once again, the economy wasn't broken. Now, granted, they are going to be companies that aren't going to be able to start up, They're gonna be restaurants that

will just never open. But at the end of the day, I think you're going to find that as factories add more shifts, as you see a global healing of the economy. And then finally, what I said before, if there is any hope for a vaccine next year, I think you're gonna see the economy recover a lot faster. You know, working from home has been surprisingly seamless for our company, something I'd never ever would have imagined, but it really has worked out well, and for a lot of companies

it really has worked out well, I believe. All Right, well, we really appreciate your time, Scott, Thank you so much. Scott Callier, CEO and Chief investment Officer at Advisor's Asset Management johning Us on the phone from Monument Colorado, 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.