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in the dollar today. A lot of that story is coming from Assia actually, and some stimulations coming from Asia. We'll start there and then we're gonna migrate over to Europe. But to do that we bring in Christine A. Tino. She is the head of our FX rates and e M coverage at Bloomberg News, sitting in the heart of the f S base little city of London. Of course, Christine,

thank you as always for joining us. The currency picture has been wild this week, and I really want to know, just in your professional opinion, what is really standing out to you. Well, pretty I think it really is just the play look of previous years really doesn't work anymore when it comes to the currency markets, because, as you say, on a day like today, when there's a lot of

risk aversion. You would expect the dollar to be up, but clearly it is not, and that has been a function more of just how much dollar has risen over the past week that today seemed like, as you say, a good time to take some money off the table.

But yeah, I think it's really you know, I've been looking at these markets for the last ten years, aging myself here a little bit, but it's it's it's written really a wild time and even I myself am having to rethink just how to look at these markets because it's really nothing that we've seen before. It's definitely the post pandemic, post uh stagsflation risk sort of environment now

that is really quite unique. You know, I'm curious Christine about Russia for a moment here, because they owe the world to money and for now they can still in theory pay creditors back. And we have news out that said Russia moves to dodge to default with a new claim on a dollar payment made. What are the ramifications here?

How much longer can they keep making these payments in theory. Well, Sally, I think this development is really important to pay attention to because up until today, when we got this news. It was actually difficult for Russia to UM make those payments because of the various stipulations from the U. S Government as well as other governments around the world, essentially

stopping them from making these payments in dollars. And this is a crucial distinction because uh they had previously tried to make this payment in roubles, but of course these bonds specifically, it's in the legal documents of the bond saying that they cannot do that. And we've had um a several committee, several ratings companies weighing in saying that potentially that brings them closer to default. So this is a bit of a game changer that they are claiming

they have made these dollar payments. Of course we need to find out from the very as other stakeholders, the bond holders themselves, the banks involved in this process, and of course the government is watching to see whether this is actually possible. Very crucial day to watch is made the fourth, that was meant to be the end of the grace period for these big bonds that Russia is trying to make payments on. Incidently, that is also a Star Wars day for any of the Star Wars fans

out there, I need to watch that movie. Um So. The other thing about this, though, is that listen, So Russian bonds, right, certain sovereign bonds, so foreign denominated bonds, So the dollar denominated bonds had really sold off earlier this year, and some of them have bounced back a little bit. There's a really controversial thing happening in the market, Christine, where some people are saying, do we buy in because Russia is making its payments? Ay, how controversial is that?

And be uh you know again, how long can they keep making these payments for given that Russia is saying the US is trying to force it into a default. Well, I think there's a lot of controversy, of course, just as an investor and being out there saying that, yes, I'd happily buy Russian bonds just from uh, I suppose a pr standpoint. But um also, the mechanics of it is quite difficult, because getting ahold of these bonds without breaching sanctions is incredibly difficult at the moment, and also

liquidity is very very thin. Of course, you know, when Russia was cut off from the global financial um uh markets with all of these sanctions, it became incredibly difficult to just trade these securities. It was for a time very very difficult to find any buyers for them when holders of these bonds originally we're trying to offload them. So it's a question of both mechanics and also just

uh I suppose pr Um standpoint. And now in terms of making these payments again, there's a lot of mechanics involved in this and and a lot of confusion still over. You know, even if Russia attempts to make these payments, will these actually be accepted as legitimate payments? Again, because of the complexity of the whole sanctions regime, and there are many, many lawyers involved who are all trying to figure out what is actually legitimate what would be considered

a default. I think May the fourth will be very interesting to watch for sure. May fourth, I believe also the f o MC meeting. And remember, on top of that you have these gas flows. A lot going on here when it comes to the rule payments, and of course we will keep you on that. We're looking at a stronger ruble today, but of course a lot of that coming down from the market. Christina Kino, head of f FX Rates and E M coming out in London. Thank you m these markets. I mean, is it inflation?

To Holly, I can't really tell what's driving this because the companies that are driving the sell off are also the company's best positioned to weather some of these issues. So I'm confused. Yeah, I mean, and also you look at kind of the flattening of the yield's curve and end this week, and you wonder what investors are thinking. Are they how worried are they about slowing growth? Is its stagflation? And how much is the our word recession

really coming up in conversations in the background. Lots of questions here, yeah, a lot of growth scares and and you know, there's really no one better to break this down with than Mark Stogel, our next guest here, CEO and portfolio manager of Adams Funds. He of course gonna know everything about investing economy, uh the Fed in two Mark, thank you so much for joining us. We really appreciated. Basically you were sold to us as a no all seen all markets gurus. That's where we're going to start

with intro. I mean, he's a good he's a good guest. I'm just trying to prepare our audience mark, Why are the markets selling off? What's the problem here? I think it's a couple of things. The first in you in your in your intro, you uh you hit on it UM. There's a lot of uncertainty, and we we've known for forever that the market doesn't like uncertainty. And I think that people have systematically been taking risk off of the table.

And part of that is represented in the tech stocks that have that that have gotten hit, and part of that isn't many of the other stocks that have gotten hit UM. And I think that in a in an in an environment where uh, there is there is unknown, and the people are going to take risk off. And I do think that there was a lot made about the tech um tech earnings. I think tech came through it, big tech, big quality tech came through it. UM I

think pretty well. I think the challenges now that we've gotten through that, there was I think you you both probably heard the collective side of relief when Avanzade didn't spit it yesterday. I think that was a good thing for the market. But we're gonna roll into next week and the FED is going to be front and center again, and so we go from concerns about technology, about about stocks, about the third year, about about inflation, and then we're

going to pivot over next week into the FED. Are they going to raise fifty what are they going to say about next month the June meeting. So there's a significant amount of uncertainty, and in those environments, people are very happy to take some money off the table, and I think that a lot of what you're seeing, it's

a lot of money off the table. Really. I mean the fact that we mean, Katty, have been talking about the fact that the monthly decline you're going to see is the worst you've seen since March, that's when COVID came around the US. So you know, that's a really big it's a significant that's a significant move that you're seeing. And to the point you made on technology, I mean Amazon, Amazon is down the most since at least and so what what is going on here? I mean, is this

a rerating? Well, I I think it's I think it's a couple of things. And I'm sure both of you have have have seen this study that was done and I and I like to talk. I like to bring it up in situations like this, The average investor that invests in an S and P five hundred index fund never gets that return because they trade it. And I think that's one of the challenges for investors is they do jump out at about the wrong time. And I think that's if you're a long term investor, unless you're

a trader. And there's nothing wrong with being a trader. I think that, you know, a lot of people can make money being there. I'm getting them, giving them the benefit of the doubt. But I will tell you most of us are not traders, and we shouldn't be traders. Were not set up to do that. What we are set up to do. We should be able to do is invest with a longer term horizon. And but but a lot of investors are having a hard time do that. They get emotional, they say, wow, you know the FEDS

inflation is going to do this. I I know it in my coffee, I know it in my fride lunches that I get, I know it all of these places that that I that that that I've seen, I can see it. So that must be a really bad thing, and it not. It isn't necessarily if you have a one or two or three year horizon, you shouldn't be you. We shouldn't see the redemptions and the outflows as much

as we have been. But it's human nature. As much as I like to talk about it and try to convince people that they need to have longer horizons, it's a hard thing to do. Now. Do I think that Amazon had a difficult quarter? I do. I talked about that a lot this morning and earlier, and I think that. But if I was, if I didn't own it, and I was a long term investor, would I begin to buy some Amazon here? I probably would, you know, in this general area, I probably would. And we'll we'll see

if other people share that view. Mark Socle, We're always short on time with you, but we really appreciate you joining us CEO and portfolio manager of Adams Funds, talking of course about all things tech and how we sell it. Next week a huge, huge week for markets, the f o MC meeting and the OPAC meeting not getting enough attention in my view that we are coming up on another OPAC meeting at a time when commandity prices remain high, inflation is still high, and a lot of red on

the screen coming from growth worries. It's amazing. Uh, energy has politicized, energy is weaponized. It is certainly the story of the year, and and a lot of uncertainty on where oil and gas prices will go. Yeah, and then let's bring it full circle right back here to the equity picture and the earnings picture in particular EXN Mobile,

Chevron both reporting some pretty blockbuster profits. I believe the biggest profits going back to I want to over a decade um when it comes to these oil companies, no surprise, able to really take advantage of these higher prices. Let's break it all down with a true expert, Simon Casey, the deputy managing editor of our Bloomberg coverage of our energy commodities coverage. Simon, thank you as always for joining us.

We were at Sarah Week a couple of months ago, two months ago, ish um and to our audience, Sarah Week is the largest energy conference I believe in the world's hosted in Houston. All the big wigs from so on to Chevron to OPEC really go there and talk about what's going on. And Simon, from what I remember, the biggest issue there was at a time when we need there was there's all these calls to ramp up production.

The energy space in the US or the energy industry in the US are saying, well, we don't have the capacity to do that, just given the legacy of the pandemic. Where are we on that, Oh, that's right. I mean, it's like they said, we can't and in case, we're not really sure we want to, and we're not even sure we're going to be allowed to because investors are going to punish us essentially for for for reacting to

to higher prices. You know, two months down the line from that conference, not one has changed any sort of production increases we've seen so far this earning season, I mean pretty sort of incremental. Chevron x On this morning come out with, you know, some pretty impressive results on the whole that they did miss the consensus f for for earnings to share both of them, there are some slight issues there on their refining business, various cost issues,

timing issues. I mean, if you can see past that, you know, these are very robust earnings. But they both companies have come out and said we're not planning to spend increased spending at all, and in fact, x On I think is likely down on a on a run rate so far for the first quarter, it's on course to spend below what it was forecasting for the full year. I mean, I'm sure might speed up towards the end of the year. Um Chevron is keeping, you know, keeping

spending tight. Um. There's the big scene this morning with our story. We'll be going with us the share buy backs that both companies have have given updates on. XN is tripling its plans shared by back to billion dollars. They have a lot of cash. They are giving no indication they're going to go out and do any deals that would be a surprise, and they're not spending it

on capex. They are spending it on buy backs at the moment, and Excells earnings called just ended, and big message from that was also that they are being very conservative on that cash management, that building up reserves. They been through a very difficult to an off your period

and they some some valuable lessons for that. I think what's fascinating here and and for our radio listeners worldwide, we want to really emphasize what Simon just brought up there, the idea that this caution in spending really is a byproduct of history, The idea that this is a sector that has been lagging for so long that have investors have really been hesitant to hop into an equity market and the bond market. I might add the energy sector making up I believe a good chunk of the high

yield market as well. And this really comes from this idea of drill, baby, drill, and and and this legacy of that. They don't want to go through that because then you get cut off from these funding streams, from these capital markets, and then you can't pay your workers, you can't expand you can't grow, and naturally you get punished for it in the stock market. Simon, Let's talk about the other side of the equation. UM generally at the top of this block said that oil is politicized

very often. The Biden administration very vocal about ramping up production. I feel like we've just discussed the internal dynamics of the shale industry. Let's talk about this from the global perspective. An OPEC meeting coming next week. But it seems like this is a problem, This ramp up, this caution is a problem worldwide, from OPEC to Europe to Russia, UM and even the Biden administration. Yeah, I mean, we got that we've we've we're now kind of got used to

monthly MOPEC meetings, which is nuts. Then the one next week, um that we expect it will be another routine in production increase in line with what you know, over a year now they've been doing these production increases about four barrels of oil per day extra more or less as OPEC gradually manages this production recovery from the massive cuts they implemented during the early days of pandemic um OPEQ and you know, ope, we largely read Saudi Arabia here

the superpower. You know, OPEC has been and eaves continue to be very resistant to demands from from administration to increase production. And you know, the lesson the impact on on the consumers and lower gasoline prices combat inflation. They don't want to hear it. The Saudies are very happy and why wouldn't they be. And we've got a crew prices you around about a hundred dollars right now. Um. You know, Grant is trading up with around a hundred

and ten h This this suit Saudi. The Saudi is fantastically because of course, you know, the economy is doing very well. They're no longer having to fund any kind of deficits where compared with all where prices were a year ago. And you know, you're sitting up really well, and I'm wondering if you'll set us up a little more next week ahead of opaque meeting And just thirty seconds here, what are you watching for? The don't fact

meeting is going to be pretty perfunctory. I mean, there's always the chance that we can see a surprise, but honestly, it'll be like if the last year has been any guide, It'll be very short, still announced the decision. It's like a rubber stamp essentially. I mean, look beyond that, what we're looking at is really Chinese demand. The lockdown in China, the world's second largest oil market, that's undoubtitely having a major impact on demand. That's God's trade is extremely worried.

And then we're looking for further developments in situation regarding Europe and possible sanctions on oil oil Russian oil. I think that that could be really big, fascinating stuff. Simon Caseley, a true expert on the energy and commanding space and deputy managing editor of our energy coverage here in the States.

We thank you so much for your time. There's a very special guest here as we talk about the war in Ukraine, as we talk about what the United States can actually do, we have no better guests than James Stravites. Admiral James Trevis, I should say of the United States Navy. He's retired after having spent thirty seven years with them, also a contributor to Bloomberg Opinion. Admiral, thank you as always for joining us. Let's take this conversation very seriously.

Is the United States doing everything it can do? Almost We have provided billions of dollars of aid, We have put highly advanced weapons in the hands of the Ukrainians. Um, we have done just about everything we can to. Remaining things that I think you'll see the administration move on fairly soon are providing longer range anti ship missiles. And this is because the Black Sea is important to Russian warships dominated Ukrainians sank one a couple of weeks ago,

the flagship. They need more weapons to reach out and touch those worships in the Black Sea. And secondly, they still need high performance combat aircraft so they can control the skies over Ukraine. These will come in the form of mid twenty nine, which will be provided by UM NATO allies, and then we the United States will backfill those two processes I believe are in motion. Um. Other than that, we have done everything we can to put the tools in the hands of the Ukrainians so they

can finish the job. You know. Pretty recently you've also written, in addition to kind of you know, speaking about the actual weapons themselves, you've written that the deadliest weapon in Ukraine is a cell phone. What exactly do you mean when this comes to information warfare? Yeah, we are engaged

in a real battle for the truth. And what I mean by that is, uh, the war crimes that are being committed every single day by the Russian military, and we've seen powerful evidence of this from places like Busha on the outskirts of Kiev. Where did we get that evidence. We got it from cell phones, from videos taken by ordinary Ukrainians who then used those supercomputers not only to record these crimes, but to upbload them into the Internet

move them forward. And we've got to get that information out in the broader world, because although we are convinced in the United States and in NATO and in the Western democracies. There are still big parts of the world in Sub Saharan Africa, Latin America, the Caribbean, South Asia that are as yet not completely convinced about the awful actions of Russia. We need to make that case with those swing voters in that part of the world as well.

The cell phone and video can help us do that. Admiral, you also have quite the resume when it comes to NATO as well. We know Sweden Finland looking to join NATO in particular, what kind of reaction can we expect from Russia and arguably from China as well? As we see the NATO presence in the NATO membership growing um. Sweden and Finland have highly, highly capable militaries. They are very advanced economies. These are techno democracies of the first order.

I commanded Swedish and Finnish troops. They were under my command in Afghanistan. They were part of the NATO mission to Afghanistan. So the quality of those nations, who also spend a great deal on defense. If you add up the defense budgets of Sweden and Finland, they are about one fourth the budget of Russia. So this would be a significant addition to NATO. In terms of Russian reaction, Uh, the Russians will hate it. And that's a good thing.

Vladimir Putin needs to reap what he has sown, and the consequences of evading a democracy like Ukraine are going to be that other. Uh, democracies like Sweden and Finland look at what happened to Ukraine and say, I think I would like a NATO membership card. We had to bring him aboard. I think it'll deter Putin. He'll be angry.

There's very little he can do about it. Yeah, I'm wondering if you can, Admiral, give us a little bit of understanding an analysis here about who are actually dealing with? Who is Ukraine dealing with? When it comes to Russia's new commander who had led brutal attacks in Syria before. Yeah, this is General Alexander Nikolaev and he is well known to Western intelligence. His file is stamped on it the Butcher of Syria. He also committed war crimes in Chechnia

during the wars there and a previous decade. He is someone who is unfortunately undeterred by international law. He will attack civilian populations, will encourage war criminal behavior, and we don't have to speculate on that because we saw him do it in Syria and he's been hand picked by Putin to continue to attempt to terrorize the Ukrainian population. One more reason we need to stand with the Ukrainians

in this fight. Admiral, I want to ask about simply what Putin's thinking is here and the timeline that we're expecting from this war thirty seconds. How long is this warre gonna last? I think it will last months, but not years. Putin is bleeding cash war as hell. It's also expensive. I think in the two to four months range, both parties are going to start looking for a negotiation. Couldn't go longer than that, sure, but I think we're looking at some form of negotiation in the by the

end of the summer into the fall. Let's hope for Admiral James Stravitas of Bloomberg opinion columnist and formerly of the Navy, the U. S. Navy and of NATO as well. We appreciate your insight in your analysis. Thanks for listening to the Bloomberg Markets podcast. You can subscribe and listen to interviews of Apple Podcasts or whatever podcast platform you prefer. I'm Matt Miller. I'm on Twitter at Matt Miller three. On Fall Sweeney, I'm on Twitter at pt Sweeney Before

the podcast. You can always catch us worldwide at Bloomberg Radio