Trump Has No Plan To Open Schools Safely: AFL-CIO's Weingarten

and on Bloomberg dot com. So we have a severe debates going on right now about whether children should be going back to school and the full what's good for them, what's not so good for them, what they'll be missing out on if they do go back, what they'll be

missing out on if they don't go back. One person right at the center of this is Randy wine Garden, and Randy has been literally fielding questions and trying to figure out what to do for all of the teachers and the support staff of the American Federation of Teachers, the largest union in the country. So Randy, thanks for joining us. And I'm curious where your members stand right now. Is it different and different rights of the country or is there one sort of the united voice on what

should happen. So it's different in different parts of the country. Um, the president's actions in July made things a gazillion times worse because he made what should be a really important public health issue into a political one and completely polarized it and angered everyone because of his lack of diligence and responsiveness to actually handling the virus. So this is so right now, we have a mess on our hands.

At the end of June, my membership I pulled them said that if we could get the safety safeguards that c d C had originally and still maintained or necessary, seventy percent of them said that they were comfortable going into public schools um and and instead of starting remotely, starting the year in school because they know, just like parents know how important it is for kids to have life instruction and to be in person. We have to

combat the social isolation that kids have. We have to make sure that kids are fed, We have to deal with kids well being, so parents and teachers are aligned on that. What's happened since the end of June is that we've seen a virus surge, particularly in the South and the Southwest, and Congress has refused or failed. The Senate has failed to act on the resources that are absolutely necessary to get these safeguards into place at the

same time as we're about to start schools. So you have this huge sense of um, adda anxiety and and um and a sense of mistrust that what is needed to make school safe for kids and for their teachers will actually happen. That's why you've seen districts who actually wanted to start in a hybrid. And I'll talk about that in a sect if you want me to have kind of moved back to starting remotely because they don't

have They see the cases in their areas spiking. They don't have the testing and the tracing, and they don't have the equipment, the ventilation systems, the mass, the cleaning, or even the space to actually make a hybrid a blended model work. So it's a mess right now, and and it was far less of a mess in June when we thought we were going to get the funding from the Heroes Act, and before the President um and and Secretary Divorce started with their threats and their demands

without a plan and without resources. So, Randy, speaking of Secretary Divorce, have you spoken to her. Do you get a sense that she understands the views of America's teachers, Well, she doesn't understand the views of America's teachers and or America's parents. Frankly, I haven't spoken to Secretary Divance since I invited her to come to a school with me in Ohio and we spent a day together, and she promised that she wanted to meet, she wanted to do

different things. We haven't heard from her since. The only time I heard from her is I got a note congratulating me on getting married to my partner, um to my partner, and and and I you know, and so that we have not heard from her. All of what she's doing is political. She she hasn't. But what's worse

than us not heard hearing from her? Every Republican or Democratic secretary of education in a circumstance like this, Margaret Spellings, Arnie Duncan, John King, Rod Page what they would have done. They were brought together, um the stakeholders to figure out how to actually have guidance for how to end last school year and then how to have guidance for how to start this year, not as a mandate, but how to have guidance and instead of us doing the this

is what it costs. We thought it cost about a hundred and sixteen billion dollars twenty three hundred dollars per student UM the district, the district administrators thought a cost about eleven d dollars per student. Why are we the ones who are saying this is what the PPE wal cost, this is what the cleaning will cost, this is what the ventilation systems will cost. And both the superintendents and

we put these figures out in May. We put our first UM guidance out in April, and so so you hear the frustration of my voice, because teachers know it's important for kids. But what's happened is that the can has been kicked down and down and down the road where the you know, administration is still pretending the virus doesn't exist. And so it's now left the teachers and parents to figure out child care, to figure out schooling

without the resources. It's just wrong. And that's why you're seeing so many people go to remote Yes, and many teachers are parents themselves and are in the exact same boat as all of the other parents of the kids they teach. RANDI, what do you say to parents that are frustrated with teachers, because many parents want to send their kids back to school as well, because they need to go and work. They haven't been working. Who knows what Congress is going to come up with, the future

is very uncertain. And you know, parents are also, you know, to a large extent, very worried about jobs. Yes, no, and I completely I've taught I've spoken to many parents, um, who are in this terrible predicament, and and this should be something that their employers should actually be working with us and trying to deal with these situations. It shouldn't, It shouldn't. So so so we need to work together,

teachers and parents and need to work together. And what's happened now is that as we have engaged with parents more and more and tried to figure out how to deal with childcare, how to deal with these this terrible dilemma, parents are starting to say to us more and more, Look, we don't want our kids to be sick either, and so ultimately we need to work together on making sure that kids and teachers don't get sick and don't start by opening schools prematurely like they did in Israel. Don't

start a new epidemic. And so even Dr Burke's this weekend, because of the science said, um that you know, if you have high caseload and active community spread. We are asking people to distance learn at this moment so we can get this epidemic under control. So I you know, so we have been pushing very hard to have the child care and we've also done the kind of thing. Hey, Randy, thank you so much for joining us and sharing this

important information. Randy Wine Garton, President of the American Federation of Teachers, are really really critical issue in this country. As schools start to open up here for the false semester, the question is how to do it safely. There is no federal guidance here, so it's left up to the local municipalities. All right, Yesterday, around midday or shortly after midday, we got headlines crossing that Argentina had agreed in principle to a deal with its creditors in order to take

that country out of default status. It's third default happening a few months ago in this decade nine default. Overall, Let's bring in somebody who knows a lot more about Argentina's economy, our chief Emerging markets credit strategist, Damian Sassour so Daman. Yesterday I was talking with one of the creditors. In fact, to Argentina who said that the deal was about fifty five cents on the dollar, depending on where you were on the curve. How does that compare with

other restructuring deals. Well, I saw that interview with Robert Koenigsberger of Grammarcy, who's an old hand when it comes to em sovereign distressed UH situations, Bonnie, and you know,

there's no question about it. This is something that was much needed, much expected, quite frankly, but really all eyes now focused on the i m F because while sixty five billion dollars in dollar denominated, WILL dollar and Euro denominated hard currency debt has now been or is now being restructured as we speak, there's still another call at fifty three billion of hard currency UM i F I

UM debt payments that need to go through. And when I say i IF, I'm talking about international finance institutions of which the i m F is one, and they are the biggest creditor accounting for roughly forty five billion dollars of Argentina hard currency debt that must come do. Repayments start start in the third quarter of one and total roughly fifty three billion THO. So that's a lot of money that Argentina needs to repay in the next five years, and obviously we need to see that get

pushed back. All right, So what is the posture of the i m F now d me and given that we've seen this deal for another big tronch of debt, well, I mean, Christelina Grgovo runs the IMF has has been very supportive of this restructuring. I mean, I obviously expect the IMF to tow the line and basically agree to something that works for the sovereign. But you know whether or not. You know, IBIRD, which is a part of

the World Bank, the Internet, the Interamerican Development Bank. I mean again, these are other institutional financial institutions that have billions and billions of dollars owed to them by Argentina. So you know, I think they all have to come together, they have to agree to something, and I expect that's where you know, the focus is going to shift for most reading agencies and most sovereign creditors over the near term.

Pole Yeah, the i m F is often credited for just being that a little bit too hard line on some of these countries that just aren't able to pay and and just you know, really imposing the strictest of conditions. How much leeway does the I MF have with Argentina, or rather vice versa, how much leeway does the Argentina economy have. Well, the I m F has really made its bed, so to speak, lonny with regard to Argentina. They are I mean, that's that most of their balance sheet.

I mean, it's their biggest um, it's their biggest loan. Basically, it's it's they have, you know, the biggest exposure to Argentina. So they need to get that righted because it really will mark whether or not the I m F is successful going forward at you know, I won't say bailing out, but assisting you know, frontier sovereign nations as they you know, as they seek to kind of grow and emerge from

you know, the coronavirus. So you know, I think, look, you know, from where we sit right now, obviously those discussions are going to take place. I expect them to go over rather well. But the real challenge for Argentina is getting locals confident in the Argentine pay so and right now, that disconnect between where the PASO is treating, at least officially and where it's trading in the black market is just so very great, and a huge devaluation

is probably in store for the Argentine past. So and and look, you know that's that's something that is widely expected. But you know, whether or not Argentina can emerge and restore confidence in its own currency and get the economy growing again remains to be seen. So Damian, what does this deal mean for maybe some some of Argentina's neighbors in Latin America? Is this any kind of template for

others that might need some relief? Well, I mean, what kind of goes under under the radar here is that? You know, this week we've also seen Ecuador agreed to terms with its restructuring right that seventeen point four billion dollars in debt that you know Ecuador owes too hard currency creditors abroad, you know Lenning Marino, you know, you know,

they did a really really good job. I have to be honest, this is the I mean, Ecuador is a surreal defaulter as well, and this is one of the fastest restructurings that i've I've pretty much ever seen, you know writ large. So you know, I think I think most creditors are you know, coming to terms of the fact that this is the very challenging time they need to kind of uh, you know, they made their own bed right, they have to take a little bit of

a hickey also. But you know, as as you see from you know, the note in the New York Times this morning from Richard Kaschell, who's you know, you're at Black Rock and was very much involved in all these negotiations through to the end. You know, they have stakeholder interest in mine. They have to worry about their own fiduciaries and their own fiduciary responsibility when negotiating on behalf of them, and so you know, these things tend to

kind of get drawn out. What I'm just absolutely amazed about is how quickly some of these deals are getting done and what this expense. But beyond two police and you know, Sri Lanka's now having parliamentary elections, they're in trouble.

They were downgraded to single B minus. So you know, there's plenty of frontier sovereigns and Goala Nigeria that come to mind that are all hurting all of approach the I m F for assistance and look, you know we're going to see in the next in the non too distant future, how many of them can emerge from this. On the on the other side, just briefly, Damian, we're seeing Argentina's bonds rise to I mean, how soon can Argentina go back to the capital markets literally nothing has

changed about the underlying economy. Yeah, I mean, you have hit right on the spot exactly what I'm thinking. I mean, I think a lot of creditors, specifically you know, US institutions like pension funds and Commond foundations, it doesn't matter whether or not Argentina's permitted back into the US capital markets. I think many of them have gotten so fed up with losses that they had to incur due to and sting in Argentine debt that it's just going to be

very difficult for them. I mean, I know a handful of them that built into their own policy statements that they you know, yes, we'll invest in emerging market dollar debt, but we will not invest in debt issued by Argentina. And that's a real problem to get, you know. So, so whether or not they're allowed back to the US market to to to to take on more debt, Okay, fine, they can do that, but who's gonna buy it? Right, Bonnie, I think that's where you're going with this, And I

think that's the real risk. You know, when you have these type of situations and now industries have wised up, it's gonna be very difficult to get them back on board. The one thing I'll say is that investors have very short term memories. You know, when things start to get right and and and and you know, and and the risk on mentality resumes. Damian sasare thanks so much as always giving us the latest on all things emerging markets.

Staming sassare chief Emerging Markets credit staategists for Bloomberg Intelligence. UH debt restruction deal getting done in Argentina, I m F is next. What are they going to do there? And what does that mean for the emerging markets overall? We'll keep on top of that. We had some media companies some numbers last night, led by the Walt Disney Company, some good numbers, some good streaming numbers or stocks of eleven. Today.

Fox also reported numbers better than expected for their stocks that off about the five or six percent this morning. So tail uh to two sides of the coin. We want to chat about that. And there's nobody better than our good friend Tuna a Mobi. He has been covering this industry forever. He's an industry analyst at cf R A Research. And for those of you that have seen Tuna on television, I can tell you he is the best dressed man on Wall Street. Tuna, thanks so much

for joining us here. Let's start with Disney this stock. I mean, I looked at the numbers last night, and the costs associated with COVID registered extraordinary close to four billion dollars. You have the stocks up ten percent? What what did the investors really like? Good morning, Paul, and thanks for having me. UM So I started Disney. Um earnings was actually UM a lot of interest in um not get some information? UM the same parts we knew going in was gonna take the major hit from the

COVID nineteen shot down. UM. But the surprise there was actually Media Networks, which had a one billion dollar swing in operating income, primarily due to the programming cause deferrals with the shutdown of production in Hollywood as well as the sports Life sports. But all in all, I thought, UM, it was a really um interesting quarter for a direct consumer. As you know, Paul. That's where the company has been pivoting for quite some time, now, surpassing hundred million UM

aggregate subscribers between ESPN Plus, Disney Plus, and Hulu. But more importantly, the launch of the International Star branded direct consumer offering. I think, really, um, you know, puts Disney in a very very good position, uh to consolidate its gains um and also the Mulan. I'm sure we'll get to that shortly. I think Disney, um, more than anyone else in Hollywood, has been trying to use the COVID

nineteen lockdown to reinvent somebody traditional distribution windows. So now Disney Plus serving as a major premier outlet for some of its marquee uh you know, titles. So all in all, we are, um, you know, quite optimistic. The shares are up um rightly, so I think when you look to the other side of this pandemic, Paul, with a strong balance sheet and now almost twenty three billion dollars in liquidity, UM, I think no companying arguably in the media spaces better

position to navigate this pandemic, uh like Disney. Yeah, and you're referring, we should say to the live action Mulan, which is going to go straight to Disney plus and maybe take it. You know, thirty buckser so away from movie theaters for the window that it normally will have gone to movie theaters first in. So that's all great for Walt Disney, but compare it with something like a Comcast.

Why is Disney performing so much better in the market and Comcast is announcing all these layoffs and so on, and and really operations are very similar in both cases, right, It's all about the portfolio of assets. And also I think in this environment, number one, we think Disney's balance sheet is superior. UM. But also being a pure content provider.

Remember coming into this uh you know COVID nineteen, UM, you know, Disney had with the Fox acquisition, UM, you know, really placed itself in a very enviable position in terms of the franchise pipeline acquired in organic franchises. So while Comcast is also getting some tail winds from on the broadband business and the residential broadband, UM, it's been much more UH susceptible. I think, UM to some other areas

like um, you know, advertising, etcetera. But Disney, I think, UM, when when this uh theme parks rebound as we think they will. Uh. There's indications of penop demand. ESPN while has been adversely affected by the cancelation of Life Sports. Now that Life Sports are coming back gradually, UM, we think will be uh you know, as best positioned as any platform to to benefit from from that. But more importantly, I think the major distinction Vney, to your question I

would draw, is a direct to consumer. That's really what separates uh, you know, Disney from Comcast in the eyes of investors, and that's a huge opportunity in front of the company, especially with the Star branded platform that they are going to be launching internationally. I might also add that they are shutting down twenties some channels internationally. It took a five billion dollar impayment charge, which underscores the strategic shift for Disney from linear to to direct to consumer.

That's where I think a huge chunk of the value is going to come from the catalysts. So, you know, what's the company saying about their theme parks. It's such an important part of their business. It's been such a solid contributor to UH earnings growth for the company for years. They invest a tremendous amount of money into that business with great returns. I'm thinking about the five billion dollars

to open Shanghai Disney most recently. Do they believe that on the other side of this pandemic, that people are going to cram themselves into these parks and you know, and and stand in line like we've become accustomed to other parks, that they think that it's gonna come back to normal. Paul, I think that scenario, frankly is at least several years out. Even in the best of times, when you're coming out of recession, uh team, parks typically

takes several years to recover. But in the case of Disney now they're in the middle of its phased reopening. All these parks not going exactly as smoothly as you you might hope, especially with the COVID nineteen resurgence across various states in the US, and as you know, they had to shut down Hong Kong again after the initial reopening. But having said that, I think we take some comfort in the fact that you know, Shanghai has been um

you know, coming along. I think their philosophy and running the see parks right now is just to maintain a positive um you know, contribution margin. So to the extent that the revenues are outweighing the variable costs, I think they can justify keeping those parks open, even that limited capacity, UM, just to cover some of the fixed overheads. But that being said, I think it's in parks probably will be

one of the last to recover. But when they do, UM, there's every indication that they're going to be you know, get back to UM you know, normalized attendance levels. Whether that takes three to five years, you know, who knows, but they just came up the peak attendance in two thousand nineteen. So it's kind of going to be a gradual process from here, depending on what happens with the resurgence. Basically, you know, do you anticipate layoffs and maybe even you know,

action on the part of the world's employees. At some point, they've already come off of massive layoffs Vannio already um I frankly, at this point, UM, I don't know, you know, how much more that they can you know, much more room. What they've done is that actually they've recalled a lot of those theme parks UM attend the staff that were laid off, So they're actually in the process of rehiring

some of those followed employees. But I think when you look at June quarter when its theme parks had almost like three billion dollar hit from COVID, uh, you know, that's to us is the trough um, you know, So even the worst case scenario when the parks have to close again with the surgeon COVID night, and we don't expect that what they just went through this last quarter is going to recur by any stretch. So we we think they're in a pretty good shape to continue to

build on what theyre I have Tuna a mobi. Thank you. It's always just an absolute pleasure to speak to. Tuna is a complete expert and everything that is media media related thanks to you know, companies that you may or may not have heard of. Telegog about the voe Go it was an eighteen and a half billion dollar deals, so a really massive deal. Jonathan Palmer is senior healthcare

analyst for Bloomberg Intelligence. Jonathan Welcome tell us how this deal came about, on what these two companies actually do. I mean, I guess we can we can guess in the case of Teledoc, that's fair. Monny for having me on. So both of these companies play in the healthcare I T space and really in the telehealth and virtual care markets. Um, they're slightly different in you know, telehealth or teledoc focus is really on episodic care, where uh Vongo has focused

on chronic care for things like diabetes and cardio. And so the the addition here are these two companies the merger, you know, I think what they vision is that, you know, more and more healthcare is going to move to this virtual world. And while Teledoc had a strong presence in you know, uh treating something like your kids get sick or you get the flu, whereas Vongo is focused on the long term, you know, treating an illness that you

might have for the rest of your life. Marrying those two together makes a more powerful treatment option for patients and doctors. This comes at a big cost, doesn't at Jonathan, I'm looking at Lavongo stock and back in March it was, you know, called it twenty two bucks a share. Here it is trading today a hundred and thirty four dollars, so it's had a huge run. And then I look at Teledoc in the stocks shares are down about fourteen percent here, So did they overpay? That's a great question.

I mean, there's there's certainly uh fair argument to be made that you know, this is the peak of telehealth and healthcare I T in terms of multiples. You know, we've seen this massive run up from the pandemic, you know, as you mentioned, lavangoes up you know, maybe five or six times from a p O price last year. Tele Doc similarly up five or six times. The market's telling you, with the stock down, that they don't particularly love this deal.

I think it's true from the perspective of teledocs management and that they're using stock ninety percent of stock to pay for this deal, so they might be signaling that they thought even their stock was overvalued. Here. Are there competitors? Is there the possibility that somebody else will jump in or that this will make for a new competitor to some of the others. There's competitors all across this healthcare

I T landscape, and and they're in various stages. Tele Doc is the most well known public company in this space, but we saw a telehealth back come out last week. There's other private companies like am Well in this space. And you know, I wouldn't put it past the big insurers like United Health, you know, as these trends gained traction to just move more aggressively in this space. So I think it's a little bit of a land grab right now in the world of healthcare. I t in

particularly in virtual care. So the marriage here these two makes a lot of sense to grab scale while while the getting is good, Jonathan gives a sense of what the trends were before the pandemic in telehealth. To be honest with you, from my perspective, I never even considered it for myself. Now I'm thinking, why wouldn't I do it? So, what what were the trends before this pandemic and how do you think that the trends will play out going forward?

Question Paul, And So, I think we've seen the change in terms of the adoptment of telehealth, and really the pandemic has caused a lot of people to look at this option very differently. You know, before the crisis, a lot of people had this option in their health plan, but on average and Teleducts book of business, maybe ten percent of their members actually used it. We've seen that double over the last couple of months, So maybe that a ten percent moving using it in any given months

of the members. And I think they're going to continue to push that adoption curve so that people are utilizing the service more and more. And so I don't know where the peak utilization is, but I certainly think there's an argument that you made that it's far far higher than the historical ten percent, and you know, moving well north of that going forward. What else can we look

to in terms of innovation? Is there anything coming down the pike to anything in terms of the way vaccines are delivered or you know, anything like respirators or PTE or anything like that coming down the pike from any

of these companies. Well, in the healthcare I T landscape, you know, they're looking to utilize all the latest tools and technologies and and one of the things I didn't mentioned in in this deal is that Lavongo has a very strong presence in AI and they uti utilize an AI engine to drive a lot of their care And so I think there's a lot of adoption of of these newer technologies like machine learning, AI, etcetera into healthcare treatment plans. And so we're seeing that across the spectrum.

You know, as as we think about the vaccine, vaccines and the response to COVID, We've seen a lot of technology move forward pretty quickly in the area of diagnostics, vaccines, um the treatment, whether they're in the bodies or repurposing old drugs. There's a lot of smart people in the world of healthcare, you know, looking at this problem um, but it's it's hard to point to one particular technology per se that's going to be a game changer for

the crisis. Hey, Jonathan, thanks so much for joining us. We appreciated Jonathan Palmer, Senior Healthcare analyst for Bloomberg Intelligence. Bonnie, when I see an m A deal across the tape, I go right to the m A function and see who the investment bankers are. And on this deal, it was Lizard for the Acquirer and Morgan Stanley for the Targets, as some of the blue chip investment banks still work in the healthcare space. Thanks for listening to Bloomberg Markets podcast.

You can subscribe and listen to interviews at Apple Podcasts or whatever podcast platform you prefer. I'm Bonnie Quinn. I'm on Twitter at Bonnie Quinn and Paul Sweeney. I'm on Twitter at pt Sweeney. Before the podcast, you can always catch us worldwide at Bloomberg Radio