Pandemic Could Create Industries We're Not Yet Aware Of

opinion columns. Max Nisson covers all things healthcare for US, and we love to have him on, particularly during this pandemic because there's so many topics. There's so much breaking news, and Max, I want to start with the Santa Fee

news here. I guess the CEO came out yesterday and said that the US would likely get first crack at their vaccine because the US was first to step up with funding here, and now he's getting some pushback on that, including from the President of France here, So give us the background here. How common is that in the world of healthcare and vaccines for one country to get preference

over another. Uh, you know, it's not uncommon at all in the sense that you do see wealthier countries UM, countries that have a manufacturing base UM do do get access more rapidly. There there was a flu outbreak that the two thousand nine one where where a lot of those vaccine stocks, which which didn't end up being super useful, were were bought up by by countries like the United States.

This is a kind of particularly special and case where you know, the United States on one hand, is providing some some extra funding helping me up potentially to build some of that that at risk manufacturing capacity before we

even know if the vaccine works UM. But at the same time, the furor that this this kind of prompted highlights that this is going to be a really complicated geopolitical issue, that there's such demand that that giving countries preferences is going to be incredibly controversial and difficult, and and that you also, you know, you if you politicize it,

that that has some risks. What if you have a situation where where the vaccine that turns out to work best is one of the ones being developed in China and they take the position that because they funded it, UM, the you know that the United States should be last in the queue. So it's it's a really risky path to step down um to do anything but try to develop maximum capacity and give it out to whatever extent

possible based on need um. You know, the best situation is not having to ration doses out or give countries preference based on their income level max just zooming out a little bit. I mean, we're all hopeful for a vaccine, and we can argue over who's going to get it first, but we still don't have any clarity of how long it is going to take. In the w H of the World Health Organization yesterday warned that it could take up to five years before the coronavirus pandemic is under control.

I'm looking at more and more dire predictions of social distance in distancing strikeing out for a longer and longer period of time as we await some sort of treatment or vaccine. Where are we How do we even judge that? Unfortunately, anyone that tells you that they have, you know, an accurate timeline is is making it up. You know, Okay, will make it up and make it good, make it positive,

so we can prepare to leave our all. That's very much the temptation, but you also want to avoid giving the sense of false hope because the best way to proceed is is not in relationship to best case scenario. It's the worst case scenario where you have to use public health efforts, testing, tracking, tracing, um screening to to keep people safe until there's a vaccine, whether it's you know, by the end of the year or well into next year.

It's just worth highlighting again that that we we're working on an untrucedented timeline. Um, you know, it may well be that higher vaccine development efforts were overcautious because um, you know, we just weren't willing to throw enough resources at them or or take enough risks and that that you know, these these rapid accelerations will prove successful. But you know, it's not like it's a slow process on

a whim. It's because if you're going to give something to billions of people, um, you know, a one percent serious side effect rate that that's you know, close to the estimated fatality rate above the virus itself, you could be having a negative impact on millions and millions of people. So you really do have to approach is cautiously, and there are a lot of things that can go wrong. It's not just about the safety, it's about can you actually produce a durable immune response if you take the

vaccine and it peters out after a few months. Um, you know, it's not all that much good, is it? So you know there there are only so many shortcuts you could take, and that's why you have to be cautious about the timeline. Max Neeson, thank you so much for being with us as all is Maxinism and Bloomberg Opinion calumnist, joining us to talk about the vaccine and the arguments that are already occurring over the distribution of those vaccines. Paul, all right, how you're gonna I'm not

sure how you figure that out. You know, it's just gonna be interesting to see when they're hopefully there will be a vaccine, how it is distributed and the boy who goes first? And what does fair mean when everyone thinks that fair is for them to get it first? Okay? Moment of truth, Paul, real, moment of truth. How many times have you googled the symptoms of COVID nineteen as well as the transmission mechanisms, the you know, rate of contagion.

You know what fortunately I have not, you know, I'm really yeah, I'm just you know, staying at home, you know, doing all the common sense stuff. And I think that's the best way to go. And I'm fairly comfortable with that. Definitely the best way to go. I cannot confess to the same, but I like at well, first it was a trade dispute. Now it's fingerpointing about the coronavirus. But the US China trade and relationship has been anything but

smooth under the Trump administration. Now we've got President Trump coming out recently saying he's looking at Chinese companies that trade on the NASDAC and n Y s C, but they don't follow yours accounting rules. He says he doesn't want to talk with Chinese President g So the question remains is where are we in terms of the U. S And China in terms of global relationship. There's nobody better to ask that of than Andy Brown, editorial director of Bloomberg New Economy, joins us on the phone, and

he thanks so much for joining us here. It seems like President Trump is ratcheting up the rhetoric, the anti China rhetoric. Is there a strategy here that you're following right. Yeah, So so look, this is not the first time, obviously that we've heard uh inflated, overheated rhetoric on China from

President Trump. Um. You'll remember in August last year, I think it was, um where, out of the blue, he suddenly orders all US companies to exit China and return to the United States, and you know, companies at a time sort of scratch their heads and tried to figure out, you know, what it was. So in fact, it was more a sort of verbal explosion than a serious declaration of intense still less, was it a strategy, um, And

I think you're seeing something of that here. I mean, obviously at route what he's trying to do is deflect blame for the coronavirus onto China. Both countries are playing this game. But the rhetoric this time, I mean, I will say it it is it is even more overblown than usual. And the one thing that actually caught my

eye was this comment on Ji Jim Ping. I mean, you know, he's been very careful, um, right from the beginning since he took office, to separate all the bad things that were happening in the U. S. China relationship on the trade front, and on military front, security front, I p front, and so on, to separate all that from his own personal relationship with Jimping. And he's been at pains to tell the world, you know, I have a great relationship. He's a terrific guy, he's my friend

and all the rest of it. And he today he's saying, he's saying to Fox, you know, um, still I have a great relationship with him, but I don't want to talk. I don't want to talk to him. And it just seems to me that that that is quite a significant step. It's now starting to look really personal. Andy, I'm struck by the increasing rhetoric by analysts who have watched this space for a long time saying that it's really getting close to a cold war between the US and China.

And I'm wondering how much this is due to the pandemic and concerns about the transparency from China, and how much does this have to do with just this general feeling of anger towards the way that China has handled trade and a host of other issues. Well, there's been a reset, obviously in the United States view of China. I mean, China is now quite explicitly UM, you know,

a competitor and an adversary UM, and everything flows from that. UM. You know, coming into this pandemic, you had real decoupling taking place in areas of technology, in trade, in investment, in talent, the flow of people across borders UM, and coronavirus M has has has has added more poison to that well. And now you're starting We talked earlier about you know, the latest area of potential decoupling, which is

in the financial sphere. And and you know, so you're hearing just yesterday, in fact, Federal Pension Fund, under pressure of from you know, the White House, announced that it was postponing a decision on, you know, whether or not

to to diversify into Chinese stocks. White Houses say, why would why should American pension has be you know, supporting Chinese companies that are competing against US companies and potentially ripping off their their I P you know, UM discussion about you know, for instance, UM, you know, whether whether whether the U s should renege on its data obligations to China. This is this sort of loose talk, but

very very dangerous loose talk. Andy, Is there any sense that the medical community at least is working together on a global scale US and China as it relates to this virus and potential remedies and vaccines or is that also uh kind of you know on the back burner. Yeah. So you you you read about collaboration and and and I'm sure that there is collaboration going on, um, you know in certain areas. Um, but you also read about you know, vaccine nationalism and um. You know, China in

the US in a race to develop a vaccine. And you know if if China got here, would they make it available to the US and vice of US? Um. So, I mean it's it's, it's it's I think it's an area of some collaboration but also potentially of competition. Andy, you know, a lot of this has gotten wrapped up in you know, how much is deflecting blame? How much to China hide? But taking a step back, how much is China really to blame here? I mean, can you give a sense of the legitimacy of the US has claims?

Look this this whole issue about you know where it came from? So um, you know, the science says it came from from bats and was passed too uh to humans through through an animal. We we don't know, we don't know what kind of animal. And that's a question that that demands urgent inquiry and answer, which is why it's so important, I think, to have a real independent

international inquiry into into what happened. But the there is no evidence to support the Trump White House accusations that you know, it came out of it, it it came out of a lab, and I think the White House as now sort of abandoned that about it was deliberate and so. But but they say that they've been you know and just just real quick, we've got twenty seconds left, but they've been talking about just a lack of transparency and how that's really hampered the ability to fight this pandemic.

For sure, it has China, China, stone Wall, China has uh stiff on the w h O and continues to deny access to w h O scientists, um, you know who, who are interested in figuring out where there's the origin

of of the virus. So there are legitimate complaints about China and its lack of transparency, certainly in the early part of the the early stages of the of the outbreak is equally true that the Trump White House ignored or you know, did very little to prepare the United States for this, for this coming pandemic during the entire

months of February. What happened then, Andy Brown some legitimate questions and ones we will continue to ask through the weeks and months ahead, and editorial director of Bloomberg New Economy joining us on the phone from New Hampshire. Until the past few days, a lot of people have been talking about the resiliency of US equities and the contrast with that against and in creed increasingly bleak outlook for

the US labor market. However, when we talk about equities, they are not all the same, and there's been a huge divergence between the mega caps, the big tech names and everybody else. Joining us now, Talcohen, head of US Markets for NASDAC in New York, tow thank you so much for being with us. I want to start there.

What do you make of this growing bifurcation where the top performing stocks, the biggest stocks, which are actually the same, have continued to outperform what everything else actually gets left behind with a bigger and bigger gap. Well, thank you Lisa for having me today, and just to touch on what you mentioned in terms of the bification. The markets are distinguishing between companies that they think are part of the solution, such as tech and biotech, versus those that

are most vulnerable, like travel and hospitality. And we're not just seeing it in the day to day we're seeing it in the inflows into the market. So for instance, and ask a q Q and I was like one hundreds, which we've seen eight billion dollars of inflows over just the last two to three months. So investors are trying to understand what parts of the economy are vulnerable, what parts of the economy came into this crisis on the position of strength, and what we'll leave on a position

of strength. And then further, you're seeing a lot of unclear economic data such as the job support which is historically bad, and people are trying to figure out Investors are trying to figure out whether the to reflection of the long term impact or is it highlighting more of

a temporary impact of the here and now. And then finally, on a day to day basis, you can wake up one morning and you can hear conflicting data on the longevity of this health crisis, where some folks will come out and say it will last throughout the year, and then you can see news at the end of the day from a healthcare company talking about a potential vaccine

or potential treatment. So I think the markets and investors are trying to make sense of all of that while understanding there are going to be different parts of the economy that will be impacted severely differently than others. So tell I mean, some folks have been suggesting that we have in fact put in a bottom on this market and unlikely to retest the lows. How do you feel about that? Given some of this economic data that we see, including today's jobs claims and what we're likely to see

in terms of unemployment and declining earnings. We'll leave that to the experts who watched the markets more closely. From our perspective, I would say that there's still a lot of unknown. We're still just looking to re enter into the into offices. We're talking about re entry plans there. Uh,

they're still talking about a second way. There's in clarity around the vaccine or treatments, and on a state by state basis here, at least in the US, you see very very different conditions throughout the U S. I think it's it's still early to tell, and from an AZACT perspective, we just look at our own experience. We're still going through and trying to understand what it means to re enter offices. But that being said, we're very comfortable working

from home. So it will depend on how comfortable you are with the situation you're in now and how long you think you'll be in this situation. Tell I'm wondering about your point with people being somewhat discerning when it comes to which companies they bet on. What does that mean for index strategies given the fact that everybody was going into passive investing and suddenly it really is a stock pickers market, particularly Pick Fang and nothing else. Yes,

I think there's a couple of things to note. There is number one, you know, the FED and government have taken actions that probably have helped certain sectors, and so it's just not the market forces at work. You have the FED and government at work, and they've taken very strong and decisive actions in certain parts of the economy.

So I think that's that's a factor. The second one is, once again, when you're working from home and you're thinking about the impact of this crisis for me personally, I'm using all these collaboration tools on a day and day out basis that I might not have been using before. So those companies that enable work from home, that enable the remote and virtual working environment, they're going to be winners.

And those industries that clearly there isn't any clarity at this point in time as to when they're going to come back or how they're going to come back, and there's a debate as to, you know, what it looks like, what's the new new normal look like. So people instead of just taking bets on individual companies might feel more

comfortable going into sector et F or thematic ets. But to your point, with interest rates and everything else being where they are, people are also looking at and being more critical about how the stock selection process would work. Now the nastack market held up in terms of performance in terms of kind of handling the order flow given a lot of the altivy we've seen over the past

couple of months, great questions. So we've been almost all of us have been working from home for the better part of two months of our workers at home, and we've been able to operate without interruption to our business and continue to serve our markets and our clients. And we've helped up really well. The markets have functioned really well, and I think we're comfortable as a company because we've

gone through it. We were lucky in some ways that the financial industry had gone through nine oleaven Hurricane Shandy, and some other events that have provided us with an opportunity to ensure that we have the resiliency and the BCP plans to withstand something like this. So I think, you know, we look at it and we think we'll be able to function well and we'll likely be a fast follower as people look onto the office till twenty seconds. Do you think a lot of people won't ever return

to the office. I think it will be done on a voluntary basis. It will be done in ways and it who's companies to collaborate and talk to their employees about what they're comfortable doing, and then that will tell us the answer. Tal, thanks so much for joining us. I really appreciate your thoughts. Tal Cohen, head of US

markets for NASDAK Nastack, of course based in New York City. Interestingly, so I think you know a lot of companies are really going to be rethinking this work from home situation. Given I think what's most feel like it's pretty decent productivity. Did you see the Connecticut governor's comments yesterday where he said that the Monday through Friday commute from Greenwich, Connecticut maybe a thing of the past. Yeah, exactly. It's interesting.

You know, as a thirty year commuter on New Jersey Transit, that is a fascinating thing to think, you know, So as we think about that, so we'll have to see how this plays out over time. When we talk about reopening economies, a lot of it has to do not only with testing, but tracing. This raises a whole host of questions. Who will do the tracing, how will they do it, What kinds of personal privacy issues does this raise? And how organized is United States? Not to mention, who

pays for it? Joining us now to answer all of these questions completely and fully is take him technology calumnists for Greenberg opinion, no pressure or anything. Hey, let's get started with big tech and how they have offered to help track and trace everybody in order to prevent the spread of the of the coronavirus. So on, April Tense, about a month ago, Apple and Google announced this unprecedented

joint effort. I mean they've never really worked together like this before to develop smartphone technology to do context tracing. Basically the learning users that they've been in the proximity of a detected person so they can get tested in self quarantine. Um the crux and my column was a lot of countries in Europe have adopted the Google Apple proposal and plan Germany, Italy, Austria, even the United Kingdom is considering it. And I'm a little worried that the

US is not doing anything on a national basis. Um President Trump days after it was first announced that it looked great, but he needed to talk to all these experts and he's gonna make a vision and that he's doing weeks, and it's been about four weeks, and we

haven't heard anything from the American government. So I'm worried that the US is not actively working on this while all these European countries and countries around the world are basically accepting this great proposal that Apple and Google are presenting, and the US doesn't seem to have his app together. So tay, do I even need the US approval. Don't I just download it from my Apple you know apps like any other apps. Unfortunately we do. UM. Apple and

Google's plan they don't actually create the app. They say one app per country. A public health authority needs to create the app to use their software technology, and for it to work, it really has to be a national app because everyone has to get involved. We have to have to share specific duty to do it. UM. It looks like in the US we have like the Utah making app in North Dakota, state by state. Thing is not going to work. We need the whole country to

get behind it. And for that to be effective, we need the president, we need the federal government to be behind it and basically say, this is a great idea. Let's have the CDC where n I h to put out an app so everyone can use it. But I just don't see that happening here. And I'm very worried that we're not going to use this despective tool UM to Really we need to fight this virus with every tool we have. UM. It's a public health crisis and

we're not doing it. So what's the main opposition to this? Is it a is it a security issue? An independence issue or is it a lack of organization issue you I think a lot of it is just people were really worried about kind of health and privacy big technology companies.

That reputation has been getting hit in the last few years, especially after the whole Facebook stuff a couple of years ago with Cambridge parent Wika, And I mean, this is just me postubly, but I just fear that politicians and officials are so worried about the political risk of partnering with still calm dality because they have this reputation, um, they don't want to do it. And the issue is this Apple Google plan is actually a really good plan.

They vigorously designed it to protect um consumer privacy, all identities to protected. They don't do physical location tracking at all. It's not GPS based on this you too through Ranks technology. It works, it's smartly engineered, it's greatly designed, and it seems like we're ignoring it alright, So t I'm still confused a little bit who is creating who has created this app as it Is it the Apple Google Consortium or is it the US government? And what's the role

of these tech companies? So what Apple and Google is doing, is there um installing. They're going to create at the middle of this month, the software API that allows public health authorities to create apps that can do to contact tracing. So Apple, Apple and Google a kind of creating the programming a p I s let um a public health authority create an app. So Apple and Google aren't creating app, they're kind of doing the groundwork infrastructure software to let

countries develop their own apps that can doing. Okay, interesting to see how this place is that. It's interesting because we've seen the European countries generally be more apprehensive about uh, you know, giving out personal information and you know, whether it's related to advertising or anything. So it's interesting to see that they are perhaps out of front relative to the U S. Take Cam, thanks so much for joining

US technology calumnists for Bloomberg Opinion. I mean, I think, clearly, Lisa, as you and the Governor Cuomo and others talk about it, the next big step in combating the viners is you know, kind of tracking and tracing, testing and tracing, testing and tracing. Yeah, and the question is how are they going to do that. I know that in New York City they're hiring a whole host of people to help do that. The question is how can you employ technology to help do that.

I know that in South Korea, for example, you have to register yourself right away when you get off, and then that you get you get tracked and traced, and the same kind of things happen happened across Asia. I'm just wondering, what's the alternative. Yeah, I I agree. I think you know, again, given the importance of kind of you know, tracing, that's going to be to really combating this and confronting it and beating it back. I think that's going to have to happen to some exempt. Thanks

for listening to the Bloomberg P and L podcast. You can subscribe and listen to interviews at Apple Podcasts or whatever podcast platform you prefer. Paul Sweeney, I'm on Twitter at pt Sweeney. I'm Lisa Abram Woids. I'm on Twitter at Lisa abram woods One. Before the podcast, you can always catch us worldwide on Bloomberg Radio m