How Bob Inglis Went From Climate Change Denier to Activist

climate change group that he founded. He is also a former South Carolina Republican congressman both in the nineties and the two thousands, and a former climate change denier who has turned into an environmental activist. Bob, thank you so much for joining us on this day when we are going to receive, ostensibly at three pm today New York time, a decision from President Trump and whether or not the

US will remain part of the Paris Accord. Bob, I want to get started with the reaction that you faced when you changed your mind and went from being a climate change denier UH to somebody who is actively advocating the need to change practices in order to preserve the environment. Why do you think you got so much pushback from fellow conservatives. Well, unfortunately, Lisa, that was during the midst of the Great Recession, and so probably not good timing

on la part. But but you know, when I came to that conviction that really this is real and something we need to attend to, UM, I had to had to do that. But UM, I think it's a different situation now and numbers of Congress who are conservative, truly conservative, UM can do this more safely than I did it back in the days of the Great Recession, because when you did it, it costs you your seat, no right at that, plus some other heresies that I had committed

but against became Republican orthodox at the time. You know, when it tribes under pressure, orthodox he becomes very important. And so because you're circling the wagons to protect this

food supply the tribe. Right. But now that the economy is doing better and people are seeing, um, the results of how how how renewables can really feed into the grid, well, how we can repower our lives, how this is really pretty exciting free enterprise opportunity, then then they can they can state it differently and it would be a different reaction than what I got, Like I said in the dark days of the Great Recession. Well, you know, I just want to follow up with that because I'm wondering

maybe you can offer some insight. I mean if you not you personally, but if one is describing himself as a conservative, why not air on the side of caution and whether climate change is man made or not, why not take action in order to mitigate it's deleterious effects. I mean, wouldn't you want to side on the you know, with caution and protect the environment even if it wasn't

man made. Oh? Absolutely. In fact, I like to tell audiences sometime here's a fresh twenty bill for anybody who will call their insurance company and cancel your homeowners insurance just for tonight, because I'm pretty sure your housing gonna burn down tonight, and the this twenty dollars it's worth more than the probability of your house burning tonight. Anybody take the offer. You know, nobody can take the offer

right because you buy insurance like sexuaries. The George Schultz likes to say against things that you that could be really catastrophic, And the key to it is whether it's affordable insurance. And the reality is, there is a way to make this affordable, to make essentially affordable climate insurance by doing a tax swap, taxing income, putting a tax

on carbon dioxide, making it an apply to imports. So the whole world follows American leadership and essentially you buy this insurance policy that that protects us against the downside risk and it is significant of the effects of climate change. Well, Bob, I imagine that you still are in communication with a

number of Republican leaders in Congress currently. Are there many others who feel similarly to you at this point, Yeah, and a lot of them are in the process of figuring out can they come out on this, you know, and really it is a little bit like coming out to come out on climates, um and so. But that's that's going to change. Just is this is that other

matter change. This is changing. People are realizing that, of course you've got a problem here, and up until now, what conservatives have heard is that's a big government is going to solve it. Once they hear that there's a small government way to do this, then they can they can open to it. Right. Well, but Bob, I think that one of the main criticisms on behalf of conservatives against some of these agreements is that they impede free market activities and that they basically put a thumb on

a weight on a scale. Uh, simply on a belief, but not necessarily Uh. With the knowledge of this will definitely make everything better. Yeah. Well actually yeah, if you really believe in free markets, as I do and as we do it republic Ean dot Org, then you want all the cost in on all the fuels and all the subsidies removed, and on that level playing field. We believe that free enterprise can deliver innovation faster than government

mandates or fickle tax in centers could ever imagine. And so a true belief in free markets says, okay, all costs in, all subsidies out, and then compete, right, And so the government's only role is to be the honest cop on the beat that says that enforces that that level playing field. Indeed, all right, well, thanks very much, Bob English. We look forward to hearing you hearing from you in the future. Bob English is the executive director of republic E n dot Org. It is a nonprofit

climate change advocacy group. He's also a former GOP and congressman from South Carolina's fourth congressional district. Well, the Miami Marlins, they didn't necessarily take on the Philadelphia Phillies yesterday in an empty stadium, but it was pretty close. About fIF hundred and ninety fans one thousand, five nine fans were in the stadium at Marlins Park for the afternoon game. So why would anyone want to buy a major League baseball team? Well, here to tell us is Chris Russo.

He is the head of the sports practice at Hulhand Loki. Chris, thanks for coming into the studio, Thanks for having me. So tell me about the Marlins, because I mean this, there's been a bidding war for the Marlins. But why a bidding war for team that can can't even draw

two thou spectators. Well, there's certainly have been a lot of reports over the past months about potential bids from Derek Jeter and Jeb Bush from Mitt Bromney's son, And part of the appeal is for these professional sports teams, they become pretty good businesses. The rights fees that are being paid by television have grown dramatically, Sponsorship has grown, licensing has grown, and the reality of it is there's

a real scarcity of teams available. The Marlins is practically the only team that appears to be available, and there's really only been a couple of deals in the last two years among the four major leagues, So there's really a scarcity factor that drives the interest in some of these clubs. Let's say a team does want to examine

the field for a buyer. Do you have a set field of potential buyers out there or is that sort of approaching anyone who has a certain amount of net income or a certain amount of wealth above a certain

amount and then they've become a candidate. In recent years, the buyers have tended to be hedge fund owners, UH, technology owners and business people, high net worth individuals, and there's a universe of folks that have either tried to buy previous teams or have expressed public interest that are typically the first ones at bat when a team like this comes up. You need a lot of wealth and and you need a lot of wealth in a relatively

few amount of people. So it does kind of limit the field, all right, limiting the field, but there's certainly a lot of people who want to get in on this, at least in terms of being able to stream or broadcast sports. Amazon dot Com, Hulu, Netflix, Twitter, Facebook, Are they going to drive up the prices for everybody else? I believe that those companies again Hulu, as you mentioned Netflix, that aren't currently aggressively in sports may ultimately play a

role there. Uh. Amazon recently acquired NFL rights, Twitter had NFL rights last year. Facebook is now streaming baseball games. This is really good news for the sports leagues and organizations because they now have new bidders in the mix who can drive up the prices. You'll still have some of the traditional media companies involved in wanting to have those game rights, but I think that competition is good

for the owners. So how much of your job is facilitating deals with people purchasing major league teams or minor league teams and how much is talking with people in the sports universe about investing their wealth, because you also you do both, right. We we focus on being an advisor on mergers and acquisitions, deals and capital raising, and in my particular case, in the sports space, that includes

not only teams, though that includes sports businesses. Last year there were transactions involving companies like Formula one in UFC and liar Field Sports, and we were involved in a deal involving a company called World Golf Tour that was sold to Top Golf. So we advise businesses and potentially teams around sports transactions, really around M and A and

capital raising. So you'd probably have a fantastic view into e SP and in some of the woes that we've seen there with the viewership going down, do you see a similar kind of decrease in interest across the various sports businesses that rely on consumers to pay for the consumption of sports. I don't think there's a decrease uh in interest in sports or even paying for sports. I

think it's going to be done differently over time. I think consumers are going to pay more directly for the sports they consume through digital outlets, as opposed to necessarily buying big cable bundles that include sports among everything else. So I think the interest in sports is continuing to grow. I think the way sports is being delivered is changing, and it's starting to change pretty rapidly. Is there a particular sport or league that is new that would allow

new entrants at lower price points. I'm thinking For example, there's drone racing league. I mean, if you want to race your drone, there's a team I guess, and you can participate. Or even watching other people play video games and get it well, it's hot, right absolutely. I let me think about the the video. Watching people play video games in an arena draws more fans then the Marlins. Drew Less sports, which is what you're referring to, has

become a huge phenomenon in terms of the fandom. In terms of streaming, there's a platform called Twitch that Amazon owns enormous usage, and so I think what digital platforms do is they allow the emergence of new sports and properties,

whether it is drowne racing, whether it's e sports. There's a company called flow Sports that provides coverage of of some of the you know, lesser of covered sports on TV like wrestling, and and and track and field, and so that offers new opportunities for these sports to reach an audience. So how about the traditional sports do you has your experience shown that the value of some of these Major League Baseball teams or football teams has deteriorated

as these other sports come up. I think the value of these teams. The Major League teams continues to rise, in part because they're still benefiting from the large rights fees deals that are still in place from television, and also because of the scarcity value. The question will be over time, do those media whites fees continue to be large, even if they're from different sources, or does that start

to level off? But right now, again, there are so few teams available in such demand for them that the pricing continues to rise. Thank you so much for joining us. A truly fascinating area and one that I know that my husband will be asking me a lot about tonight. As I can see you're getting into drone racing. Drone racing, and so what would be the like technical you can sit and use you know, you can you can watch, you can sit all right, Chris Russo, thank you so

much for joining us. Chris Russo as head of sports practice at Julihan Loki, which is based in New York, talking to us about mergers and acquisition opportunities within both sports teams and sports businesses. Know him. No, I don't think drone racing. You maybe like shuffle board. What's the board? We get you a ship to play that on anyway, we want to take a moment to let you know

about something new from Bloomberg. Starting right now, you can use our io s app or our new Google Chrome extension to scan any news story on any website, instantly revealing relevant news and market data from Bloomberg and other sources related to the companies and people you're reading about. So no matter where you're reading the news, you can bring the power of Bloomberg's news and data with you.

It's pretty amazing. Download our Io s app or search for the Bloomberg extension on the Chrome Store to try it out. Learn more at Bloomberg dot com slash lens. It has been a painful year for anybody looking to invest really conservatively, given the fact that gold and silver and some of the safe haven trades have not delivered the results that many were hoping. Michael Cogo is President portfolio manager of the Permanent Portfolio family of funds, which

over sees about three billion dollars, and he joins us now. Michael, I was looking at your Permanent portfolio. It's a two point eight billion dollar fund, uh and I was looking at some of the top investments with gold, silver treasuries. These have not been assets that have been as reliable this year. Do you still think that they are a worthwhile Betton? Do you think that we are going to move to a more risk off environment anytime soon? Good morning, Lisa,

Thanks for having me. Um. You know, yeah, I think there's always room for diversified investing, and that's what we do in our permanent portfolio. So I wouldn't say gold and silver have had awful years. They you know, they're doing okay there. But but realistically, right now, given the interest rate curve, given corporate earnings, given the likelihood of additional growth, UM kind of a bent towards policy, tax regulation, at least that's what we're all expecting at some point

in time. Um, there is a little resistance two stocks continuing to drift up and and so that's what happened. And so while we would advocate a healthy UH investment in stocks as well because that is a growth asset class, we also diversify ourselves among a bunch of other asset classes just in the event that the economy turns to account for multiple scenarios to profit but also protect against downside risk. So I think there's always a good time to be diversified and to hedge your bets even in

a positive stock market environment. All right, Michael, I wonder if you could tell us what is the most unloved investment category that you've been presented with over the last quarter. I would say probably energy, UM, materials, and UH and maybe financials from an equity market standpoint. Um, you know, because some of those trades had had a good bump post election on expectations UM of those types of industries outperforming.

Yet while the economy is still growing, the economy so far this year sort of continues to look a lot like the last couple of years. And so we don't know where we're gonna end up in Q two. But Q one wasn't great, um, and so you're still looking at this sort of one to two percent kind of

annualized GDP growth. I think everybody expects this catalyst through policy and tax and less regulation, and but but to date nothing has been passed, and so you've had incremental gains in that area, and as a result, you haven't had the the economic momentum to get us to high two to three percent GDP. So, as a result, the stocks that would benefit in that environment, the energies, the

the you know, the transports, the financials, the industrials. It's been a lot more of a mixed picture in those types of industries, and people have reverted to the you know, the high profile you know, Fang plus five type stocks and and other types of growth names, and that's where a lot of liquidity has gone as well. Michael, I'd love to get your take on some comments that we

heard earlier in the show from Leo Groshowski. He's the chief investment officer B and Y Melon Wealth Management, and he was saying that he does think that that the market is still has value the stock market US stock market in particular, he's going into emerging markets. He's basically going for the risk on trade, including technology shares as well as others. I'm wondering, do you agree with that assessment.

Do you think that that is the correct bet for somebody generally sort of use that as a guiding principle while making allocations right now? I sure do, and I think, you know, we talked about our permanent portfolio being somewhat conservative and and sort of you know, a downside risk protector, but we also invested to make up for that to provide growth in our portfolio. We tend to invest in growth, high beta, high volatility type stocks to give us give

our portfolios some some growth movement. And so I think in the stock market, I believe there's always value UM. And I think where you you look right now, you would look to the areas that have not kept up with the broad market UM. And I think some of the sectors that I mentioned would would probably get you there, and those are the sort of risk on growth oriented names.

So I would totally be in line with that way of thinking, and probably our own equity based investments and where we're looking for value would would mirror that type of thinking. Now, you've got to have a strong stomach. That's not where the market has been so far this year, but looking forward, UM, where the values might be going forward, UM, I think that is the way to go. I mean, keep in mind, the last several years, you've had very low cost capital that's been buying stocks and bonds, and

as a result, there's definitely some sectors. And keeping mind with low interest rates, you know, people have been searching for yields, So there's definitely some sectors that have gotten

richly valued. The the yield equivalence in the stock market, the consumers, UM, you know, those sorts of things that people are still investing in, and UH, from a value standpoint, you probably want to move away from those and into some other things that haven't kept up that the prices are less and have more growth potential going forward the

next for years. Well, Michael, let's say that you don't have a strong stomach for any of this, and that you know you perhaps think of actually taking some profits. How can we never hear anybody say, gee, sell a little bit. There's nothing wrong with taking a profit. You're never gonna go broke taking profits. I I agree. I mean, I think in this environment, after an eight plus year bull market in stocks and bonds, that you know, that's not to say that they will correct in and of themselves.

I mean, usually it takes more than just somebody saying it's time for correction, UM. And the economic data isn't supporting a recession or anything like that right now, and so you've had UH stocks continue to go up for the reasons I mentioned. Corporate earnings have been good in the last three quarters. UM. But there's never a bad time to take some money off the table. And I mean, I think what we're hearing from our investor base a lot lately has been okay, I still want to make

some money in the pocket. I think it has more room to run, or maybe it's getting close to the time that I pull back, But we're starting to hear more people talk about what's coming next, taking some money off the table, putting some some investments in even in something like our fund that that is in stocks only, you know, as a hedge against maybe the fact that the stock market won't go on at this rate forever. So I think it's never a bad time to take

money to take profits. UM. Keeping what you earned along the way is as important as making it, and I do think sometimes people forget that. So i'd agree with you, Michael. What's the most contrarian bet. The most contrarian bet right now, I would say would be probably equity investments in energy and materials UM for a lot of the reasons I've given UM, and probably the financials as well. Uh. I think that in the longer term that's where a lot of value is in the stock market. And uh, you know,

we certainly have strong investments there UM. But it's it's been tough riding them at the moment um. But again, we we think we tend to think out, you know, two, three or five years out with a lot of our investments and uh and so you know, we do have the strong stomach to wait, to wait the story out and hopefully it it plays out the way we think it will. But yeah, that's the Conturian move right now. You know, we're we're not in a lot of the

high profile um fang type of stocks. I think they're all great businesses from a consumer standpoint um, but a lot of them are very pricey. I mean, we do own Facebook, but uh yeah, we gotta I got we gotta leave it there. But I want to thank you very much. Michael Cogino. He is the president and portfolio manager of the Permanent Portfolio family of funds, helping to

manage approximately three billion dollars, based in San Francisco. This is Bloomberg Markets on him Fox along with Lisa abrama Witz, and we've been speaking about low stock market volatility. A lot of people are looking for any action in the months of April or may probably didn't get it. Here to tell us more about it is Laura Keller Financial

reporter for Bloomberg. Laura, maybe you could just describe has been has this period of time, this May and April time frame, has this been unduly low when it comes to volatility? Oh? Yes, Phim, that very much has been. When we were looking back at the VIX index, which is really the best measure, um what most people use, I mean, it's really near a record low, and it's been that way close to ten points on that VIX index,

uh for the last month. So it's really just been quite a period of just not a lot of price changes, and therefore, you know, for a lot of these traders, a lot of these banks and by side to not a lot of trading, you know, Laura, I was struck by the action yesterday. JP Morgan shares for example, down about a little more than two percent yesterday after the news that they and Morgan Stanley and by of America we're going to see substantially lower trading volumes. And I'm wondering,

why is this a surprise to markets? I mean, isn't this clearly portrayed in all the data that things are cooling off and that people are kind of slowing down. I don't I don't know if that's quite truly, so I think, you know, in terms of chats, maybe people

have some awareness of this. One of the analysts that we spoke to for our story, Gerward Cassidy of RBC, you know, he was saying, yes, you know, investors did expect this quarter to be less fantastic, but probably only about five percent or so down on the trading side of things. And here JP Morgan is telling us Mary and Lake the CFO yesterday, you know it's down about fifteen percent, and Bank of America saying, look, it's probably going to end up between ten and twelve percent down

for the quarter. So those are definitely more significant moves than I think many investors had anticipated, even if you know, they themselves understand that their own activity has been muted this quarter, and then also know that banks need volume

in order to have good trading for the quarter. Well, you mentioned also in your in your story, which I recommend everyone on Bloomberg dot com, is that when you have this kind of low market volatility, it may be because all of the things that people thought were going to happen didn't happen, such as a victory by the

far right in the French presidential elections. But having said that, is no one really prepared for that, you know, out of body, out of mind experience that comes from nowhere, that the could crush your so far pretty stellar returns for the year. You mean, if anything could change coming up in the next that that no one can predict. I mean it's almost as if no one is buying insurance just because nothing has happened in the past. Yeah,

it's a little bit that way. When you start to think about ideas and why aren't you putting money to work, I think the better way to look at it is actually more on the side of cash. Many investors that I've talked to you have said, luck, we're going to cash. There was a story a couple weeks back on the Bloomberg terminal talking about different debt investors that have moved that way as well. So once you have that happening and people are pulling back their money, they're not actively

going out and buying things. So that's really what we're talking about here. I don't know that it necessarily means that you don't think that there could be something on the horizon that maybe you're positioning for in the future. It just seems like there's no you know, sort of push for that right now, and people are actually pulling

back and getting more defensive therefore not trading as much. Laura, Not all trading is the same with respect to profits for the banks, and there's some higher profit, higher margin areas like corporate debt trading or mortgage backed security trading. Usually debt trading is more profitable than equity trading. Do you have a sense of where the heaviest declines in

activity are right exactly, he says. You point out electronic trading is really happening in the markets for equities, so as a bank, you just don't get as much fees on that. That is an area actually where marrying Lake said, the bank gpmorgan was doing pretty well. So equities seem like, you know, they might be okay as far as trading volumes and revenues, but the debt side, which again, as you point out, is a lot where a lot of

banks make more money more fees. You know, we can see when we look at trades data, which is the UM industry collective for all the different prices and all

the trades, that volumes are down. I mean they're not down hugely, but you know five six percent, it can be significant in a quarter, and so far that's what we're seeing for April in May, and then when you take that and extrapolate for the banks, that can be a hefty bit of change for what they're not making on fees on these trades, especially because they've had such a good period of time of bond trading revenues over

the past year or so. So this comes sort of a reality check whether this industry really is making a comeback. Laura Keller, thank you so much for joining us. Laura Kelor covers the financial industry for Bloomberg News, and she comes to us from London. Thanks for listening to the Bloomberg P and L podcast. You can subscribe and listen to interviews at Apple Podcast, SoundCloud, or whatever podcast platform you prefer. I'm pim Fox. I'm on Twitter at pim Fox.

I'm on Twitter at Lisa Abramo wits one. Before the podcast, you can always catch us worldwide on Bloomberg Radio.