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Welcome to the Bloomberg Markets Podcast. I'm Paul Sweeney alongside my co host Matt Miller.
Every business day we bring you interviews from CEOs, market pros, and Bloomberg experts, along with essential market movin news.
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Looking at the jobs data headline on the terminal. One of the stories that reads by US labor market defive slow down forecasts in broadening strength right now, want to bring in Tom Gibble. He is the CEO at Lassal Network, joining us on Zoom Tom. When you look at the jobs report that we saw too hot to handle, what really stands out to you from this report?
I think number one is the unemployment number dropping, which happens to be somewhat seasonal, but it's still a really good sign based on where things were trending over the past couple months. And then secondarily, the fact that we added one hundred and ninety nine thousand jobs is fantastic. But of the one ninety nine, I believe one point fifty were non government, which is a really good number to see that over seventy five percent of the jobs
added or non government. So it's a really good sign. And now, you know, here's just hoping that that not only do they not raise rates, that that they don't not lower rates, that they don't raise them as well. So I think we're gonna be okay.
Yeah.
And in terms of the Ali and his good morning, it's manas here alongside average early earnings coming in quite nicely plus point four percent month a month year andyar it takes you to four percent, So there's no sign of the steam coming out of that engine at the moment. And this is what markets are going to focus on, isn't it, which is, there's no collapse, this is a nice soft landing and earnings are strong.
Well, I think that what people are scared about is it's not a landing at all. And I think that that is it's the craziest market I've ever seen, craziest economy I've ever seen. The stock market continues to go up, earnings are positive, unemployments low.
It's certainly not laying the work for hard landing.
I mean, that's the whole point. And that's what the bond.
Market rallied furiously on, which was, you know, some kind of a crack in the dams. So what is no landing Because no landing doesn't get me two hundred bases points of cuts from the FED next year, does it? No?
But but if they don't think it's landing at all, it might get you another another twenty five or fifty bases point increase. So you don't want that either. And I think hopefully we're at a point now where we say let's let this thing ride a little bit. And I don't think we'll get the cuts, and I don't think we'll get the increase, and so we'll just be flat and see what happens.
What people don't realize.
Sometimes the economist that's definitely main street is that the economy is so much different than we've ever had it in the history of this country. And what I mean by that is Number one, there's more startups than ever before.
So Google lays off people.
Small companies are gobbling these people up that didn't exist. There wasn't this startup culture that people could go find other jobs. So there's just more companies that exist for people to go work at. Number two, because of technology, the skills are more transferable. Fifty years ago, if I was a General Motors or a Ford or a Chrysler car person, that was all I could do. Today, because of technology and transferable skills, you're not stuck in one
industry vertical for your whole career. You can move into other areas. And so those are the type of things that have made this job's recovery in this job's economy so much different than any other time in American history.
And tom to see some of these rate cuts play out, though, does something need to break? I'm just looking at the unemployment rate extremely low at three point seven percent, I had seen expectations maybe for that to cross the four percent threshold.
Yeah, I think what we're seeing is it's not it's not gonna you know, the only way if the if the FED really believes that the only way to curb inflation and get it down to two percent is to have massive layoffs.
So I think which.
Would be destructive to the overall economy. Not helpful, but destructive, would be to raise rates, you know, one hundred and fifty basis points over the next three, four, five, six quarters. And I don't think that's gonna happen because right now, what we're seeing is companies can survive and operate with relatively normal interest rates. And what we had it was just too long of an explosion of growth due to zero percent interest rates and no repercussions. And that's the challenge.
Is when you can open up a business as a venture capital firm, or you can finance one as a private equity firm and have almost no risk of loss, that creates a net for everybody. That's just not fair, it's not safe, it's not normal. Now what we're seeing is with normalized interest rates as we had throughout the history of this country, the economy can still survive, and that's a positive thing for society.
One of the biggest debates that we have been having during this massive rally in the bond market and sort of explosion in equity markets higher, was that we were going to face some kind of a debt cliff as sort of a refinancing cliff in theory. Do you believe that that's part of the reason why we're still sustaining ourselves, that that cliff is just not materializing.
Yeah, I think it's a matter of time. I think what we've got is is that there's more equity in people's homes than we've ever had before, and at the same time, the rate on borrowing money is increased, and so what we've seen is people have the ability to borrow more, and we're seeing consumer debt increase. We just
haven't seen it hit the wall yet. And I think that the biggest change I've seen in consumer spending and debt versus ever before is that people used to borrow and have home equity lines or whatever it was, but they were also saving for rainy day. And now what it seems like is no matter how much money people have, the saving for rainy days gone out the window because
there's this sense of the government will step in. I'm not going to get kicked out of my house, and there's an overall cultural shift that's existed, and I do think I don't think it's going to happen in twenty twenty four, but eventually the rubber's going to hit the road there due to the deficit and the large amount of individual debt as well.
Yeah, we're talking to CEO. Let's sell on network, Tom Gibble. Tom, you make an interesting point because when we were talking around Black Friday and Cyber Monday sales, it seemed like the consumer was more than happy to use things like buy now, pay later, taking on credit card debt to keep buying goods. You're talking about the rubber hitting the
road in twenty twenty five. How does that shake out with a labor market that you've made the point to that's still strong and still has quite a number of transferable skills. If people were to be.
Laid off, well, I think that's exactly I think you're going to have a big come up and soid it'll probably make a difference of who wins in the election in twenty four and where Congress sits of what the bailout will be.
So now we've.
Had, you know, in the past fifteen years, we've had the recession and the corporate bailout, We've had the pandemic and the consumer bailout. So now we're going to look and we're going to see what's going to happen when we get if we get another recession, and how bad it gets on the homeowner side, on the residential, on the commercial real estate side, and what we see with
the continuing growth of the national deficits. So I think that because we've had this expansion of companies and to quote Tom Freeman, right, the world really is flat from a standpoint of jobs being able to be done anywhere in the world, that I think people are going to realize that they've got to work, and they're going to take jobs below what they were making. Salaries are inflated right now. I don't care what anybody says. We're up
four percent. Wages are and what's gone on in the past thirty months with wage increases on the hourly side, and the salary is crazy to happen that fast, and it's going to come down, whether it's in twenty five or twenty six. It's going to come back down eventually, and I think that as long as people have jobs when that happens, will be okay.
But you will see that that recalibration on wages.
But that's interesting. So you're saying we see kind of a resetting of wages in twenty five, twenty six, in twenty four, like in terms of when you're looking at the labor market, wage growth, recession risks, that's not a twenty four story at all in your view.
I don't think it's going to be a twenty four stor. I think it's going to be a twenty four story for two reasons. I think number one, we've still got the infrastructure bill, and so what that means is the government's hiring people like it hired twenty five percent of the one ninety nine that we're added in the November jobs report, and that leads to trickle down economics to
the private sector on the infrastructure package. So we've still got this infrastructure package and all those trillions being spent, so that keeps things afloat. In twenty four plus, you have an election cycle year, which there's obviously incentive for that to keep the economy humming as well. So twenty four I don't see being a problem whatsoever. I think that we're pushing things. We're kicking the can down the road a little bit.
I just want to come back as an intern on Wall Street. We're I get one hundred and twenty dollars in our next summer. I'll just leave you with that thought. That's what we're paid in twenty twenty three. Will they be able to command that in twenty twenty four?
Interesting conversation though, Thank you so much. Tom Gibble again, CEO at Lasal Network, joining us via zoom from Chicago.
You're listening to the team. Ken's a live program Bloomberg Markets weekdays at ten am Eastern on Bloomberg dot Com, the iHeartRadio app, and the Bloomberg Business App, or listen on demand wherever you get your podcasts.
Baby Filton, Manus Granny here filling in for Paul and Matt, Joined now by Nancy Tangler, CEO and CIO at Laffer Tangler Investments. Here in the Bloomberg Interactive Studio. Nancy, we get jobs data, We get University of Michigan sentiment data. Markets are trading higher. Too hot to handle this. It seems like we were not initially kind of gearing up for this kind of a market reaction in the pre market trading.
Yeah, well, I think I think the volatility well, first of all, it's friend to the long term investor. So if you were in there buying early this morning or pre market, you're in good shape. But I also think that the Michigan numbers were more important than the jobs numbers. They weren't really the jobs numbers that is as robust as the headlines indicated. So you saw, you know, the return of UAW and screenwriters. You saw a lot of healthcare jobs, but manufacturing jobs were down. So I think
that the initial reaction was ill informed. Remember that it's the algorithms that are reading the headlines, you know, driving volatility. But the Michigan numbers were actually, I think, quite encouraging, and I'm loving this rally.
Those pesky i'l goes and I have it in good authority that they have financial cloud. The one year inflation expectations come in at three point one percent on the Michigan numbers. Now that is perhaps the more significant piece that the bomb market will look towards, isn't it.
Yeah?
And hugely better than the market was expected.
Full point three was the expectation previously full point five percent.
Yeah, so you're right, man.
I think one of the things that we've been arguing is that inflation, Yes, it is coming down. I think what the disconnect between most people and us the financial community is that maybe coming down, but there are still embedded very high costs.
I think.
So that's why I think the Michigan.
Numbers are so powerful, because there seems to be some realization that we're at the end by the consumer. Maybe they can you know, sort of absorb some of these higher prices.
Can I just say, as a recent transplant to your fine country and your esteemed city, my gosh, it's expensive. And I have come from one hallish expensive city, from Dubai, from the Middle East on food on boost and there was no tax. There was no income tax there. I mean, I'm being taxed within an inch of my life? How strong? Where do you want to? Where do you want to be in this economy? Because this is this the immaculate disinflation?
Is this the soft landing of these these these sayings are so awful, But but how do you position for it? Because it doesn't look brootal or hard well man, I.
Think we were talking pre show that. My analogy is I was alive in the nineties.
And as was I, I was.
Managing just for the director show barely and I was managing billions of dollars. And this feels a lot like that. So you have what I would call and some are calling the Fourth Industrial Revolution or a supercycle in technology, digitization, generative, cloud computing. I mean, just look at Broadcoms numbers last night,
and that's the poor man's Nvidia. So if you look at that and you say, okay, we had higher inflation, we had interest rates that were five to eight percent in the nineties, we had an inverted yield curve what was called then ASoft landing. I'm not predicting one this time. We had a war, we had a recession at the beginning of the decade, and yet the Nasdaq was up over eight percent, the Dow and the S and P
were up over four hundred percent. So I think stocks can continue to do well in hell here the surprise is going to be earnings, I think for most investors, and I think what we're seeing now is that for the most part, the market's not listening to the FED anymore, which I've said, and we don't need to debate.
It has a credible ratesgized.
Has a credibility problem for sure. So I want to be in overweight technology. I want to be overweight industrials because the pmis are bondbing when.
You're looking at technology, though, is that predominantly within the Magnificent seven and friends or you're looking at kind of more of a widespread rally within tech.
Yeah.
So, so the companies that are so our investing theme is old economy companies Bailey that are pivoting to digitization and embracing it, and then the new the companies that are providing those tools. So so our biggest holdings in technology would be Microsoft, Palleto Network Service, now Broadcom.
I'm probably forgetting half a dozen of them.
But the names that that are going to drive this next supercycle.
I'm not interested in meta.
We own a little bit of Google, uh, but we want those are in some ways glorified ad companies. We want the ones the company instead of driving it.
It's interesting because when we've had a variety of people in through the morning time talking about the propensity for mag seven to deliver out sized returns in twenty twenty four may well be more challenged, and perhaps you want to go a little bit more for breadth. At the end of every year, I'm waiting for the Goldmen's report to come out on buybacks or whatever. But this is where I want to get your sense. Buybacks are incredibly important.
Apple intermittently do it, and we spend the whole day gorging on Apples buy back and bond issue and stuffun and whatever. But where will buy backs put a floor in this mode?
Absolutely to what extent took the words right out of my mouth.
It's from the script.
You secretly did I say?
How did I read that?
You said it better?
Yeah, I think clearly they are going to. And one of the things that drives when we'll continue to drive that is the insatiable appetite that the shadow banking system has for corporate bonds. But if you just look at the mag seven and it's not all of them, I think it's four or five. They're going to issue one hundred billion dollars in share buybacks over the next year or two, or claim a one hundred billion, however you want
to say that. I think that's what we saw in twenty twenty and twenty nineteen, and that's what we're going to continue to see in twenty twenty three.
It is, and.
As Apple's a big chunk of that. So you just need them to do what they say they're going to do. And so I think you buy the dips in technology. And I know there's a lot of people that are saying the tech trade is over.
I just don't agree. I think they're ill informed.
Well, I'm looking at kind of the catch up trade, if you will. We're seeing the equal weighted SMP catching up really since that November late October bottom. How do you see that playing out in different areas? You mentioned industrials. Is that a place that you're continuing to put cash to work. What names do you like within the industrial space.
Yeah, so we like the ones that are automating. And I would say broadening out is great for portfolio managers because we have to be diversified, Bailey, So you can't put all your eggs in the technology basket. But you know, Carriers one of our largest holdings in industrials. You saw it pop today on the sale. We also like Illinois Toolworks. We have exposure to Emerson Electric, and we actually have exposure in a different portfolio to Honeywell, so it has
done not nearly as well as those names. But I think you still want to be in the short cycle of industrials and then broaden out in We have a market weight in healthcare, we have a market weight in financials, and an overweight and consumer discretionary, so broadening out is great. We were adding risks back into our portfolios in October of twenty twenty two, so we were adding to technology when the last death no was issued, and we will continue to do that as we have the opportunity.
You mentioned consumer discretionary. It's the chatters died down a bit. But what's your thought on kind of this ozempic trend and is that really going to reshape the entire economy and how people spend.
I don't think so, Bailey.
I mean, you know, I was around when we had fen Fenn and for a while it was great, and then all the side effects showed up, and I just don't think there's enough data. And I was just in the Midwest and they have not gotten the ozembic message or the memo, So I think I think it will have an impact mildly, but I don't think it's going to hurt these companies, like the initial reaction indicated.
And then just very quickly you look at we have a big take story this morning talking about Hermes having delivered one thousand percent returns since they batted away LVMH. You know, do you feel confident at all in taking some of the higher, let's say, the premium names relative to Henny's a very European number. I'm learning as I go here in terms of what's big on the high street and anything. Are you so comfortable with taking any of the higher value luxury names.
Yeah, I mean we do own Lululemon, and it looks to me like it turned around this morning when I was walking over here, and that's because they are a premium provider and they are delivered, they've delivered, and they're adding two.
Already, one sixteen up sixteen bucks.
Yeah, I'll take it.
And then we own Nike, so that's another name in that space that you know, can be high with.
Those, somewhat high end with those though, like again a somewhat high end definitely areas that are targeted to the younger generation, people who want to spend when you look at you, that is me. I know I don't want to for.
People we're spending like crazy.
I'm technically not a baby boomer yet.
Go on, we've got about thirty seconds. But how are you thinking about kind of the strength of the consumer into twenty twenty four, just given how much the younger generations have been putting on credit card debt and things like buy now papers.
Yeah, great for American Express, by the way, which we also own. So I would say that people spend when they're working, and they spend out of their net worth. Americans have one hundred and fifty four trillion dollars in net worth, half of which is in with my generational core cohort, which is the baby boomers. They are going to continue to spend. They have no debt for the most part, and they will continue to spend. So I
think high end is good. We're looking at LVMH looking for an entry point, and I'm going to run over to a MA now that you reminded me, I.
Can't afford to going through this.
We got to leave it there though. Thank you so much. Nancy Taylor, she is the CEO and CIO at Laffer Tangler Investments.
You're listening to the tape cats are live program Bloomberg Markets weekdays at ten am Eastern on Bloomberg Radio, the tune in app, Bloomberg dot Com, and the Bloomberg Business App. You can also listen live on Amazon Alexa from our flagship New York station. Just say Alexa Play Bloomberg eleven thirty, Ley.
Lip Schultz and Nathan Hay're hanging out with you here on Bloomberg Markets. Paul and Matt are both off busy jobs Day Friday. Right now, looking at the markets. You've got the SMP relatively flat, as is the Dow and the Nasdaq, but keeping an eye on the two year old at four spot seven to one percent and on the ten year four spot two four percent. Right now, we are joined in the Interactive Broker studio by Ben Emmons.
He is the head of fixed income at new A Wealth, talking the market, talking jobs and what stands out to you because headline numbers seemed hot, but there are a lot of things to kind of look at under the hood on this report.
Yeah, what I was looking at this morning was the ADP report first, and I noted that the leisure and Hospitality was negative in the ADP report, and ADP is leading in some of the sectors NFP reports, So I was surprised to see a forty k gain in leisure in this report, and it jumps out because there's a lot of job growth out of that sector of the last years now and it's very consistent, so it's still
not slowing down. And I take comform them saying like, well, this job market may be quote code loosening if you think of the job openings, or you think of even if you can tell someone in continuing claims or auto measures, but you think of leisure, that's like a growth engine for this job market, and that's I think positive against Look, it was good to see this influx of people back in the labor forces the other guests was talking about
and the guest was talking about. But it's important there to notice that the share of foreign immigrants as part of the labor force that's increasing now up to twenty percent. So I think what's going on in the last few years is that as we get more people coming into the country, they get into labor force to find work really quick and I think that's a really important development because if that continues, not only that that keeps the job market like humming and going. It also is for
productivity really important. And so the average charity earnings although they were up, but it was like four tenths of percent versus forecast point three. You know that's not like a dramatic increase such that that's really because of the effect on productivity. So it isn't a way a Goldilarcks number, a Goldilocks reports and why the markets are as they are. I mean, you would expect yields to jump by this much and you would think that starts with rally and
that's exactly what's going on. So again a job support that says to me, this is an economy that does not warrant the successful amount of ray cuts that we're seeing being priced in the market.
Hey, Ben, it's Nathan in DC. Good to speak with you again. Does that mean that you're thinking that this job market is going to continue on this trajectory of the kind of growth that we have seen that's defied so much of what economists have been expecting for literally months now.
Yeah, it does look like that, Nathan, because you know that the strikes you see being added into the the headline, but the strikes itself did not have ripple effects in the economy that some people feared like, and meaning you would get wider spread job losses because of all the disruption, and you know, against somewhat the layoff trends that are ongoing and the job opening is declining, that that is really just a marginal loosening of the labor market that
allows other people to come back in and find work. So it's it's a better of labor markets. It's a
market with the momentum. You know, the cancers fat put out a puts out a labor momentum index, and I noted that that index actually barely changed the last sort of six months, meaning has not really declined in any way, even though you're seeing like for example, job openings declining or other indicator the clinding, which means loosening, that does indicate that people can find work and that there's momentum in the same market.
And then I'm looking at the warp function. Right now, we've got about a coin flip odds for a first rate hike in March, and it looks like just over four expected in twenty twenty four. What's the markets read on kind of where the FED sits where we can take some of this data.
Yeah, if you take today's report, it does not argue that the FEDS should go ahead and match market expectations, but we got to take note of what happened in June. They actually had pencils in the Hunter basements of cuts at that time and then revises of them in the faifty. Right, and now the market is back to Hana plus. So they could actually go back and say, hey, guess what would just go along with the market. But I think a report like this probably tells them like, we don't
actually have to. It's really, you know, highlighting how we think about the economy. It's moderating. It is a software lending, even though it's not an official language, but it's an economy where they've done enough with restrictive policy rates so that it can get to a better stable, you know state, and as a result, you don't have to necessarily forecast all those Ray cuts. I think that's next week, the
tension in the markets it will be. I think some are taken back where Powell will be well, it sounds hockeys, but really was saying like, see, we have enough data points to prove to you markets that these raycuts are probably over extended, and as he said in the speech a week ago, you know, he diffused the speculation there. You don't need to speculate on raycuts, and so I think that will be big message next week.
Yeah, I wanted to ask whether the narrative shifts when we get that inflation data next week. What do you think we're going to see from CPI.
Yeah, there will be pressure on CPI from the energy effect of the last month or so, Nathan, because that that clearly will filter through now and you can tell right from from the now cast of CPI or how the market is pricing CPI. I think that's fairly accurate.
On the other hand, the sticky items that we're been following for many months probably stay sticky year, and that this not seems to be too much movement yet to happen there, even though the last CPI report was such a I guess groundbreaking data point of the owner's equivalent rent finally declining is the pandemic pressure gets out of that component. So that will be the big topic for next week too. Will see in continuing decline. If so,
probably the market will take it favorably. But for the fat that's all again playing in their hands and their message like this is what they have been forecasting and what they've been expecting. So to them, it's more of a vindication of that they're restrictive.
Atto she's working and looking at some of the granular data. I keep coming back to wage growth because it does seem like the FED is very much fixated. Obviously that's a big driver for inflation. When you look at the print from today, when you look at expectations into twenty twenty four for wage growth, how does that play out and how does that factor into inflation and what the FED can and will do.
Yeah, the wage trackers from the Atlanta FED have all shown a moderation most sectors, including the leisure sector. I think it's only a two a somewhat of a soft landing type path, just like how inflation has come down in a soft landing mode, and as basically the economy since twenty twenty one has been declining down. So and
it's also effect of productivity. Right, we have a significant productivity pickup this year, so wage growth should start to moderate as more people get in the labor force and you're getting somewhat of a. You know, i'd say supply and dement, you know, rebalance and therefore that wage pressure eases off again. That is favorable to the economy because it doesn't mean like it's outright wage deflation first foremost. Second, you know, the real wages are likely going to be
improving given that what inflation is doing. So I do think it's a positive development. You know, look the average arlity earns. We're a little bit up this today in this report, you know, but not like alarming. The effect from the UAW negotiations, for example, isn't yet coming really true, So I'm not so sure if it if it's a wage price viiral idea, it's more of a moderation.
So is there room ben for rate cuts of any size next year? I mean, I know there's still a debate about, you know, whether we're going to see cuts as aggressive as the market's been pricing. But do you see cuts in any stretch next year?
So I find there's a really important question Nathan could think about what we're going to go into next year. It's an election year and attention will be about the economy obviously, and we know that if you keep raged too restrictive that that could affect the economy really negatively against you know, whatever physical stimulus that we're still pumping
into the economy does start to fade off. And if you take it against that backdrop and the FAT continues to make ground against inflation, then it has put out this framework to manage this politically, saying, look, we have a high rate. We can bring it somewhere down as inflation is declining because you know the difference between the nominal rate and inflation is getting wider, and therefore leave some room to have the nominal rate go down and
that will be your rate cut. But it's literally taking out the most restrictive part from the FAT funds rate a little bit down. It's like insurance raycut, as I say, you know that the protection against the downside of the of the for the economy. It's nothing about like an alarming raycut. Okay, we've got an ease policy really aggressively because we're about to slip in the major downtown.
Got to leave it there, Ben Emmons, thank you so much. Had to fixed income at New Edge Wealth, joining us here in the Bloomberg Interactive Broker's studio again all eyes on the job, support and some of the data that we've been seeing.
You're listening to the tape. Catch a live program Bloomberg Markets weekdays at ten am Eastern on Bloomberg Radio, the tune in app, Bloomberg dot Com, and the Bloomberg Business App. You can also listen live on Amazon Alexa from our flagship New York station, Just say Alexa Play Bloomberg eleven thirty.
One of the big political stories of the last few days, in the aftermath and the ongoing turmoil that we're seeing in the Middle East, is this reaction that we've seen on college campuses, protests on both sides pro Palestinian pro Israeli, and the rise of anti Semitic incidents at college campuses.
And we had that congressional testimony just a few days ago from the presidents of Harvard Mit the University of Pennsylvania, where they were asked, you know, pretty direc dire to say whether calling for the genocide of Jews on campus violates school policy. And we saw these narrow legal answers that were given by those university presidents that really has sparked this ongoing backlash not just from students but from alumni. Major donors. We saw a major rabbi who worked at
Harvard University resigning in protest. This controversy just is not going away, and it could really have an impact on university endowments.
Yeah, it's something that we've we've been tracking and been paying attention to. As you mentioned, you saw the alumni at Harvard University, among others, really kind of pushing back on how the board and how leadership at the universities
are handling this. And it does seem like it's only gotten worse in the wake of Harvard President's clouding Gays that congressional testimony on December fifth, and kind of the questions around how universities and a lot of the biggest and most well known IVY League universities how they're handling it and reacting to it.
Yeah. Absolutely.
I mean we've seen the university presidents you mentioned Claudiine Gay and also Liz McGill from the University of Pennsylvania sort of issuing statements. We had a video statement in fact from the penn president trying to clarify those comments and sort of walk them.
Back a little bit.
But this backlash isn't going away. So with that in mind, we want to bring in our Bloomberg News higher education reporter Janet Lauren, who has been following this very closely, breaking a lot of news in the aftermath of these ongoing protests and this backlash that we're seeing for these university presidents. Janet is with us. Now, what's the latest. Are these university presidents living on borrow time?
Well, it's not entirely clear. There's obviously a lot of discussions going on right now their boards. They're trying to figure out what to do next. The hearing was somewhat of a disaster. I think that sort of universally understood. Keep in mind that these schools are also under investigation in several ways from the federal government. There are lat that are Education Department is looking into their Title six complaints,
which is civil rights issues. So there's that investigation. We also heard yesterday that the House Education Committee is also investigating. So one thing you have to you do have to remember about schools, even though they are private schools, they get a lot of government money. You know, you're you're looking at student loans, you're looking at grants like pel grants,
you're looking at tax deductions from donors. But Also, they taken a tremendous amount of federal money for their scientific research, so if that that's threatened, that could be quite a big problem for them. In addition to all we've been hearing about with donors calling back. You know, we had a story earlier this week that everyone small donors, large donors, volunteers.
You know, so many people are quite upset about this, and they're trying to step back from places like harverd and Penn where they've had relationships for not just a few years, but we're talking decades, you know, fifty years.
We had a story about a pen donor who is clawing back, using an interesting strategy to claw back a donation of one hundred million dollars based on a morality clause that he had included, and you know, in a letter to his staff he said, I never thought I would ever have to use this, but was so horrified by how the presidents responded in the hearing that you know,
people are still quite stunned. You know, these are if this was a public company and you had a CEO testifying, you know, you would have our real immediate reaction in a decline in STUF prices. But as these are you know, private universities don't have that same kind of metric.
And Jennet, what what happens next in terms of how the university has handled this, what actually happens with some of the leadership members.
Well, these are discussions that are happening now about the president's about the board members. You know, there's been a push for the board chair at Penn, Scott Bock, to step down in addition to the president. So these are discussions that are you know, that are happening now. The schools are looking to also limit liability. But I think the overall issue that people still have is why is this pervasive anti semitic? Why is there a pervisive anti
Semitic nature on on these campuses? Why is this still allowed? Why is you know, why are there still people allowed to scream the word atafada and have signs up? And it's it's it's an environment where Jewish students find threatening. And I think that the response from the hearing is that's still not really being addressed, and it.
Points to the difficulty as well when we see you know, the top rabbi and the advisory board of Harvard University feeling that he has to resign after the comments that we heard from Claudine Gey, the Harvard president. I guess it speaks to the difficulty that comes to, you know, trying to change minds on university campuses when you know a lot of students have, you know, pretty strong views on these issues, such a complicated issue with Middle East relations.
Well, but it's not just the students, it's also the faculty.
Yeah, right, I think exactly.
It's the concern. It's the students and the faculty. And in this pervasive atmosphere continues, and there is sort of a double standard that people have mentioned if you were hearing these types of words for other ethnic groups or you know, trans community would not be tolerated. And uh, you know, and the criticism is coming from all all camps. You know, you heard the Democratic too, congressmen who represent Massachusetts, both Harvard alone, both Democrats, both military veterans, saying they
were extremely disappointed in their alma mater. So it's it's really quite quite a widespread dissatisfaction.
And Jenny, in terms of universities, obviously we're talking Penn, Harvard, MI t how wide spread geographically in terms of universities and colleges are these issues in these conversations, Well, I think.
You're hearing them the loudest, certainly at these campuses on the East Coast, certainly Stanford as well. Uh, you know, you're you're not hearing as much as at other places. And it's a good question. You know, perhaps you've had issues at the City University of New York system, but it's you know, perhaps if you're a smaller liberal arts college not near a big city, you know, it just it just may not be as pervasive because your critical
population is much smaller. But you know, several people have made the point, and the rabbi did as well. You know, most kids on college campuses today do not feel this intensely.
They're just there to get an education.
And you know, when you see the videos of the classes being disrupted with bullhorns and the uneasysiness of the students, you know, they're paying eighty thousand dollars or they're borrowing money, or the school is giving financial aid. They want to do their work, they want to finish their finals, and there's a tremendous amount of disruption. And you know, the
lawsuit that was filed by some Penn students. You know, this is the amount of tuition that families are paying, and they're just they're not there to protest, They're there to get an education and learn.
We've got to leave it there. Janet Lauren, thank you so much, Bloomberg News Higher Education Report talking about all the backlash around anti semitism on college campuses.
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