Bloomberg Audio Studios, Podcasts, radio news. This is the Bloomberg Surveillance Podcast. Catch us live weekdays at seven am Eastern on Apple CarPlay or Android Auto with the Bloomberg Business App. Listen on demand wherever you get your podcasts, or watch us live on YouTube.
Joining us now from Blackrock, Amanda line them if we are quiet?
Now? Why are the markets so distressed?
Good morning? Thank you for having me.
I think what's been puzzling to us is that we've had an hour view, a trimming of the left tail risk on the trade policy uncertainty, but we're not completely in the clear in terms of the overhang and the potential hit to margins.
As you were discussing in the earlier.
Segment, Credit spreads are wider, but they're not reflecting a sharp down turn in growth. As for the yield backdrop, our colleagues in the Blackrock Investment Institute, I know you had way on earlier. This week, we're expecting a steepening of yield curves and a rebuild of term premium, the long ed. I think that's what that march higher and interest rates is reflecting for mere mortals like.
Me who never look at this stuff. Where do you glean the most information? Is it in high yield dynamics? Is it in short term? So for fancy full FIH where does a mandoline them turn to learn?
What fixed income says?
I think the short term funding repo markets are definitely important in times like this.
We're staying in.
Very first contact. They are there.
I would say liquidity is a bit challenged, but they're for sure open and functioning for corporate credit investors. Actually, the new issue debt capital markets has been a really important barometer of confidence during late twenty eighteen, during the pandemic, even during periods of the commodity disruption. The freezing of those capital markets during those periods of time did catch the FEDS attention. We know that right now they're open
and functioning, just at a higher cost. We're watching that very closely. The other thing, at a more macro level, is this feedback loop, This really important feedback loop. We would argue between corporate margins, the layoff rate, which is still low, consumer spending and overall economic activity. If pressures on margins are enough for corporates to flex that layoff tool more aggressively, we think that could really cause some concern in the broader economic backdrop.
How do you guys feel about credit quality out there in the marketplace.
It's an interesting question, Paul.
In times like this, the reflexes often just move up in quality.
So to speak. We're actually pushing against that a bit.
We're actually fine moving down in quality within the investment grade universe because on net, those companies are very well positioned fundamentally heading into this. So we're fine moving into that triple be part of the capital structure, and then even into the high end of high yield. Actually, in recent years, especially since the pandemic, the fundamentals of the high end of high yield look very similar to the low end of investment grade. There's a lot more fluidity
between that market in terms of issuers. So we're actually fine reaching down in there. That picking up of additional spread is going to be really important given the volatility and the treasury market to of pushing those total returns.
I'm man aligning with us head of macro credit at Blackrock this morning.
A lot of good conversations, aren't they pardon BlackRock's pretty big, aren't they there are?
Yeah, they're on the edge of ginormous. It depends if Jeff Rosenberg is having a good day. The most important quote I've seen here and I put it out on Twitter this morning, this is from the Governor Waller a tail of two outlooks of speech.
This is Waller, folks.
In terms of output growth with large tariff increases, I would expect the US economy to slow significantly later this year and this slower pace to continue into next year. What will our listeners and viewers debt instruments do?
Right, So that's not priced in too credit spreads to the earlier point, there is some room for credit spreads to widen. Now, the magnitude of that growth downturn, we would argue, has yet to be determined. If you assume, like our colleagues and BII do an average effective teror freight of twenty percent using the economic rule of thumb, that's around a two hundred basis point hit to growth and a two hundred basis point upward pressure on inflation.
The one thing that I thought was really important from both chair Pal and Beth Hammocks comments yesterday is that it seems that FED officials are acknowledging that the dual mandate could come into tension later this year as unemployment increases and inflation potentially increases. That's the most important part of I think the commentary that I gleaned yesterday, and what that means is that it's not a given that the FED will cut preemptively if we see signs of a growth downturn.
Private credit.
I don't.
I mean, you got to take responsibility for private credit.
You're fixing the space private I mean a black rock.
I mean, they ruled the world private credit.
Are we going to see some stress there?
Do you think so?
I think, just like liquid credit, private credit is subject to the business cycle and a deterioration in growth. We are expecting an uptick I would say, in liquid credit and private credit and covenant amendments, defaults, that sort of thing.
The one interesting point, though, is that in times of private in times of liquid credit market volatility, private credit has usually stepped in as a financing source for a wide range of companies when the syndicated markets don't function as they should, not because of actual fundamentals, but more so technicals, which are a broader conversation.
There's the blue button, the detroit Lyons blue button.
There's no gray hair in the room.
I remember that in every single crisis, the Wall Street angst is a surprise. Are these new fangled private credit private equity things do they have an internal leverage in them that makes them the next surprise?
The amplifying channels that were present during the financial crisis when I was actually covering the insurance sector, they're not really there, Tom, And I think one of the maybe understated points on private credit this is long term capital that is locked up and is not really subject to run risk, for example like bank deposits. Right, So you're at matching long term capital with long term investments.
That is going to be a stabilizing factor.
Now we should not be pollyannish though, but a credit cycle or an economic downturn will cause losses. But can we bridging the gap? Is that a systemic risk? I think is a bridge too far?
FED Chairman J.
Powell, he's in news today, probably not for the reasons he wants to be What do you expect this FED to do over the next coming months? Is there any role they play here that I don't calm the markets to provide maybe greater liquidity.
Sure, so as it relates to monetary policy, we're not expecting them to be preemptive. So we view a rate cut in the first half of this year as unlikely barring a really sharp downturn in the labor market, so you know, payroll gains fifty thousand or less a couple months.
I think they have.
Calmed the market.
When the thirty year hit five percent, we started to hear from Susan Collins and others that they were kind of watching conditions in the funding markets and ready to step in to deploy their very robust toolkit that is left over from the pandemic and the financial crisis. So I do think they're kind of waiting in the wings that if market.
Dislocation gets there.
But volatility is different than a lack of functioning, and it seems that we're not there.
We're not there at the moment.
One final question, and it's just as simple as this. Everybody's going to go and flat over a long weekend. I mean, I get that. But the basic idea here is who's selling making prices go lower in bonds? Is it foreigner selling or is it domestic selling? What does black Rock say?
We foreigners own around twenty five percent of the corporate bond market, so it's not just foreign holdings of treasuries or foreign holdings of eecutaries. Actually they are a meaningful participant. I do think that if you think about actually, European credit spreads have outperformed US credit spreads significantly over the past few weeks, and so I think while the US had been a destination for capital for a lot of these foreign investors, that may on the margin retreat a bit.
That being said, the US corporate bond markets are still the most liquid, deepest, broadest market. So there's not a ton of substitution available in other markets outside.
Of you US.
Did I do that? Okay? So you're not in trouble with Chris Mead.
I think that's he is perfect.
Is your bagual work today? I think so, Amanda line and thank you so much. A black Rock.
Here, you're listening to the Bloomberg Surveillance Podcast. Catch US live weekday afternoons from seven to ten am Eastern Listen on Applecarplay and Android Auto with the Bloomberg Business app, or watch US live on YouTube.
Anastasia Amroso joins us right now, just absolutely outstanding of having the courage and this crisis, that crisis to stay in the market, chief investment strategist at I Capital, Anna Stagia.
Let's get right to it.
Now.
Do you maintain a bull market call?
I don't.
I don't not in this near term outlook of time frame anyway, Tom, And you know the reason for that is you really have to parse the approach of the administration right now, which to me really spells short term pain for long term gain. And maybe we get to the long term gain and I'm happy to elaborate what I mean by that, but the short term pain for now, it seems to be something the administration is willing to stomach, and therefore, as market participants, we have to adjust accordingly.
And the short term paint time that I'm talking about is the fact that either the consumer wallets will have to absorb what is this round of tariffs, or corporations will have to absorb it. And there's a cost that's associated with moving your supply chain and really rejiggering the way you've done business for the last number of years. So the second quarter that we're in right now, to me, is about this process of adjustment. And you know, yes,
the analysts have been cutting earnings. Yes, the S and P five hundred is down fourteen percent from the fifty two week highs. But I still think this negative revision cycle for now is still with us, so near term, I am cautious and defensive in a portfolio kind of stage.
I'm just looking at the earnings for the S and P five hundred on the Bloomberg terminal and just you know, a few weeks ago there were twelve percent roughly now it's kind of eight nine percent growth in county year twenty five.
What do you think earnings growth shakes out for this year?
Yeah, I think it definitely goes lower from here. And you know the way to think about it.
For about a five percent increase in the effective terror frate. This is, by the way, according to Goldman Sachs calculations, you can expect one or two percentage points to decline in earnings growth.
So if you do the math for the sixteen percent.
Effective terror freight, which we most likely have at the moment, that probably takes us down another three to six percent lower on earnings growth. So the S and P five hundred estimates are down about three and a half as you mentioned, and I do think there's three to six percent lower to go so we might end up with roughly flat or maybe plus two percent earnings growth for
the year. So the good news with that, though, is that the markets move ahead of that, and the fact that is and P is down that fourteen percent from the fifty two week highs, it does suggest the market is already prepared for, you know, for this cycle of downwards revisions. But in historically, when you look at investment periods like this, it is not a great backdrop for risk assets when you have cyclical slope down and negative earnings revisions.
What happens if the tariff crisis is a lesser crisis, if somehow the magnitude pulls back, the President capitulates, whatever, what will happen.
To people's four to oh one k if that happens?
All right, well, I guess we saw the preview of that.
Tom last Wednesday when tariffs were reverse And this is why it is a precarious time for investors. And the way that I do position this right now is, yes, you have to honker down and prepare for the short term pain in your existing portfolios, and at the same time you have to think of this time if you are a long term investor as a moment of opportunity for a long term investor.
So I would really sort of decouple.
If you have an existing portfolio, you stayed defensive, you lean into stables, you lean into each is, you lean into private credit where you can get paid. But if you do have cash on the sidelines that you've been waiting to deploy, if you can take a.
Twelve month plus time horizon, I think that's excellent stage.
We know.
It can't be bearish for too long talk because obviously is on our side, right, most.
Of our guess have a twelve minute horizon. It's good to have ana stage out of twelve months. We're going to continue with Anastasia m Roso here of ICAP and a.
Time of crisis.
You know, we make jokes about it, folks, but you know I really have to say, boy, there's a lot of tension out there.
Sure, people just exhausted, and our job.
Is to keep it light, but this is serious stuff.
It's great to have someone on a Blackana Stagia put.
The bat down with the market opening, Lisa Matteo.
I can't help, but good morning, guys.
Well shairs have been mixed before the bell slump and health insurance really weighing on sentiment right now. The markets are open, so let's get to the feeling this morning. S and P five hundred up three tenths of percent twenty points five two hundred and ninety six. We have the Dow down a percent, four hundred and eighty two points three thirty nine thousand, one hundred and eighty eight, and the Nasdaq that's up about half a percent ninety
two points sixteen thousand, three hundred and ninety eight. The two year yield at three point seven seven percent, that's little changed. They yield on the ten year four point twenty nine percent, and that's up about two basis points.
We have the Bloomberg Dollars Spot index has little changed right now, and checking in with a few stocks that were really moving before the belt now at the open, we have United Health down seventeen percent, Hurts up twenty seven percent, and Eli Lilly up thirteen percent.
That is your Bloomberg opening bell report.
Paul in Tom say people are making money with that or is it just about a lot of losses?
Yeah, I think you know, across the board, we're seeing you know, the median stock down much more than the overall index.
Anastaja Amiros with us.
With that, I kept Anastasia, you were so great in a bull market, and the theme was by America, by free cash flow, buy the Mag five, the Mag six, the Mag eight.
What ever, is that still in place? Can you own Apple this morning?
Well?
I think some of it is still in place, Tom, And you know, coming into the year, we did worry about the Max seven stocks. We did worry about semiconductors, and some of it was because of the big tech regulation. Some of it was because of this raft of tariffs that and expert controls that we expected. So for the time being, the first place I would step into would not be the Max seven stocks, and.
Semiconductors, for example, will likely.
Be challenged if you have this cyclical slowdown in the global economy. They just get caught up in export controls and the overall slowdown. So I don't necessarily think that that part of it right.
Now is the first place to be.
They're not immune from US economic slowdown either, But I do think that, as I mentioned before, you want to align yourself with the direction of policy right now, and the direction of policy is focus on domestic companies who are sourcing their cost of good soul here in the United.
States, and they're mostly selling to the US consumers.
So that's why sector like utilities and real estate and consumer staples for example have outperformed. And by the way, also financials are held up as well. So that's why I would focus there right now. But I will say Tom that you know, if this administration succeeds longer term, and if this results in deals that brings production to the United States, if this results in a new world order, we actually heriffs and non TEARFF barriers do drop, then
maybe we do have this on shoring investment boom. And so you have to allow for the possibility, especially given the tax policy in the US.
Which suits so favorable.
She can't be negative. I mean, you know, thank you so much with I capital greatly greatly appreciated.
This is the Bloomberg Surveillance Podcast. Listen live each weekday starting at seven am Eastern on Applecarplay and Android Auto with 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.
This is a really important conversation. I did it chart years and years ago in the Bloomberg which was the decline of manufacturing employment in America, and there's Ebsen flows to it, but if you've run it on a log axis, frankly, folks, it's a really smooth, just technological driven decline and employment is the population of manufacturing in America. J Timmins is the CEO of the Group for Manufacturers and National Association for Manufacturers.
As we mentioned, he's out.
Of the Ohio state, done a lot of work for various political types of North Carolina's driving the voice of manufacturers. What's the number one thing Jay, the President gets wrong about manufacturing in America? All the stereotypes that are out there, what's President Trump.
Most it wrong? You know?
I think that what a lot of Americans get wrong is that manufacturing is a very modern, technology driven operation. And it's not. It is not the manufacturing that you might think about from your father or grandfather's days. This is something that has a different type of skill set that's required. And so manufacturers right now are investing a lot in training that next generation of the manufacturing workforce.
I saw a chart yesterday that showed the complete lockey in the philosophy folks of individualistic America, the complete failure of America to retrain the workforce after the last forty years.
Lightheiser, among others, has been great on this.
How in God's name do we start acting like Europe and actually retrain manufacturing types put out of work.
So let's not act like Europe completely when it comes to manufacturing. But I agree with you that they have some really good apprenticeship programs, and we we're pretty proud of our apprenticeship work that we do at the National Association of Manufacturers through the formerly known as the Toyota Fame program, so we were spreading that across the country.
I think what we really need to focus on, though, if we truly want to grow manufacturing investment here in the United States, we've got to make things less expensive here in this country. So by that, I mean our tax policy twenty seventeen. Those tax reforms, they were, as President Trump said, rocket fuel for manufacturing, investment, hiring, wage growth in our industry. Those things are expiring and we need to get those We need to get those renewed,
and so we're waiting for Congress to do that. The regulatory burden is another big cost driver about fifty thousand dollars per employee per year in compliance costs for manufacturing.
We need to do credits like LBJ a million years ago, just do direct credits to manufacturing.
I think, well, I think tax policy is actually that would help drive that investment, right, So if you have lower tax rates and you're able to compete against the rest of the world's that's really where I think we want to We want.
To say at what types of manufacturing jobs do we really want to bring back to the US. We want to bring textile mills back to the US. What do we want to bring back?
So I do think that the narrative that manufacturing the manufacturing workforces is in decline is actually a false narrative.
We've had.
We're right now at about thirteen approaching fourteen million manufacturing employees. That's been pretty stable for the list, stable in the last six, seven, eight years. To give me that, Yeah, but we want to grow it, right, We want to grow that here. And so those jobs, and I appreciate the question, those jobs are really very very different than in the past, so highly highly technical job, so we want people to be trained with a very different set
of skills than perhaps even five ten years ago. Right, And so to your very first question, that falls on manufacturers to invest in training their workforce. And I'm pretty proud of what we are doing in the sector right now to accomplish exactly that. So we need, but we need those economic policies that help facilitate that.
So it seems like, you know, a lot of folks are now questioning the value of a college education, and a lot of folks are saying.
Poa trades are really.
You know, talk to us about trades school is so lucky to have an Ohio state person here.
Talk to us about the trade schools are.
They're becoming extraordinarily important in the manufacturing sector. But I also want to say that we have something for everyone in manufacturing. You know, probably about forty five percent of the jobs in manufacturing require nothing more than a college's part a high school degree, but there are positions that are that require a four year degree or technical training even advanced to all across.
I want to go to the pausal motion and I'm going to double barrel here. The Financial Times, I'm sorry, I can't set the author as one of their great newsletters, had that wonderful survey three four days ago. Everybody wants to bring Jay Timman's world back to America more manufacturing jobs, but a huge body of Americans don't want to work in manufacturing. There's a poll spoke volumes. But the videos that have gone viral, which is fat people like me
sitting in a machine doing mundane factory work. That's the stereotype Paul was just talking about.
I mean, the fear is, you got some four.
Hundred and six hundred eight hundred people outside Hong Kong doing make work.
Do we want to bring those jobs back here?
So I want to grow the types of jobs we have here in this country. And I know it sounds kind of tried to say, but I love opening up the doors to manufacturing facilities for young people. My daughter Ellie is traveling with me this week. It's her spring break, and we've been able to go into a couple of plant floors and I think her eyes were opened about the possibilities in manufacturing. Those jobs are pretty exciting, They change constantly, and they provide really a lifelong and presently.
Bud in advance that with all his legislation.
I think that the Chips and Science Act was very important for this country. I think that the investments that we made in infrastructure were very important for this country. And in the IRA Bill that was passed, there were some policy provisions that we thought were very important as well. So look, I mean manufacturing changes, and I'm not going to sit here and say that you know it's manufacturing is a Republican industry or a Democratic industry. It's an
American industry. And when manufacturing see's been.
In the trenches of the Capitol.
I mean what you just said is that app that Republics and Democrats are on the same page.
I think every single person I talked to, I don't care if they are a Republican or Democrat. They want to manufacturing succeed. Now have these people that went to the University of Mission. That's that's still out for debate. But listen, I understand that there are different philosophies on how to accomplish that, but I can tell you from what I when I talk to manufacturing leaders, what they say is reduce the cost of doing business here in
the United States and we will flourish. And when either side or both sides focus on that, that is exactly what we'll see in this country.
The cost of production, the cost of manufacturing in the US. My understanding from sixty years on this planet in business education is that it's higher here, materially higher here than the rest of the world. That's why the jobs went to other places.
Around the world.
Can the US compete on a cost basis manufacturing wise?
You think yes, and they can do that. And listen, some people will say, oh, well, the cost of labor, you know what, don't give me that. I want to pay our people more. I want our people in this country to be paid more. If we're going to do that, that means that we've got a lower cost that we actually have control over. And I sound like a broken record, but I'm going to go back to tax reform twenty seventeen.
Those reforms were rocket fuel. And now we have members of Congress saying, well, maybe we don't have to do quite as much.
As we did before.
Maybe we can raise taxes on small businesses. No, that's not going to work. That's just not going to work.
What type of jobs, what type of manufacturing would you like to see in the US that maybe we're not doing right now?
Actually we're doing almost everything. I just want to do.
An iPhone here, well versus we have come in.
I believe that those are the types of jobs that you'll see coming here with the right policies.
Yeah.
How do you respond technology production?
Yeah, in the last couple of days, they've reducted the Trump are no visit to Texas to try to make handbags for Louis Vuitton whatever leather projects as well. How do you respond to the stereotype Americans can't do the fine work that we get out of Asian manufacturing and employment. I'll give you one example. Gretch, now owned by Fender, makes white Falcon guitars in Japan. They're exquisite. Nothing was
ever made like that out of Michigan years ago. How do you respond to the fact Americans can't do the fine manufacturing work of Asia.
Well, maybe we should do that in Ohio, but it's a big part of Ohio right now.
I'm just listen.
I think Americans can rise to the challenge of literally anything in the terms of manufacturing.
But I do have to say.
This, we can't do everything here in the United States, much as we would like to, but we can do a whole lot more. Right now, we have five hundred thousand open jobs in manufacturing, And to your point, are people really inspired to go into manufacturing? That is the job of our Manufacturing Institute to make sure young people.
See pay is a solution there ll pay is the highest.
In any section of the economy, right, the average pay.
I must ask, how do you respond to job loss in Windsor, Ontario and job loss in Michigan and manufacturing auto?
I mean this is nuts some of that too, right.
Some of that is going south right where there are lower costs of doing business, and some of that is demand, and some of that is additional potential costs like tariff policy that could have a negative impact on our ability to be productive here in this country to lower the cost of production.
We're hearing the whole discussion of tariffs are creating a lot of uncertainty in the marketplace. Are you hearing that from the manufacturers you talk.
To every single day?
Yeah? I love times.
So are they just are they pulling back on capital investments?
I think that they are very to be very blunt about it. I think manufacturers are very concerned. They want to see progress. The President has given himself ninety days. I don't know what that's down to now, about eighty probably left to negotiate deals from around the world, and we are very hopeful that we're going to see some policies that are zero for zero tariffs. I understand the Italian Prime Minister is proposing exactly that right now for the EU. But we also have a couple other issues.
We've got critical minerals, critical inputs like critical minerals or machines for machinery for shop floors, chemicals that we can't do here right now. We've got to figure out a way to bring those into these discussions as well.
By the way, is there bipartisan support to fix a pharmaceuticals are made in China or Europe or rare minerals have been co opted by China.
I don't see the bipartisan support.
Well, what I hear is we want to make sure that our supply chain is strong and is kind of unbreakable. If you think back to COVID, our supply chain was broken and so we weren't able to access things like PPE. We were as an organization, we were calling the entire world to get PPE here to New York at.
Please to put up your back. I want we gotta go.
But Jay Timmins, this is a manufacturing at your best. This is Anthony Volpi American made torpedo bat. I want to ask you Yankees, that is a fine American manufacturing.
Now exactly right, Let's for the great American game basebe there.
You go, yeah, let's hit it out of the park. You're going to hit it out of the park. And as the Yankees did last night. Jake Timmins, thank you so much.
She CEO and President of National Association of Manufacturers can't say enough about that.
This is the Bloomberg Surveillance Podcast. Listen live each weekday starting at seven am Eastern on Applecarplay and Android Auto with the Bloomberg Business app. You can also watch us live every weekday on YouTube and always on the Bloomberg terminal.
Joining us now is the Woman with the Greatest job a college known to mankind.
Here's the way it is, folks.
You're at home and you're you know, you vote right down the list GOP and your daughter, your son announces that they're to the left of Bernie Sanders, so they want to go out and get the job in America. Ali Martell has the job out of George Washington University with Blue Rose Research. Ali How did you get the job every kid to the left wants in America? How did you actually get this plumb position wrapped around Bernie Sanders?
Well, right now, I'm working for a company called Blue Rose Research, which is an organization that works across the entire democratic and progressive ecosystem.
But to start, I am a data analyst by trade.
And that's something that I had to self teach through things like Excel and online courses and also learning a little bit on the job as an organizer. Right, no one path to becoming a data analyst, but it was a fun path.
I set her up for that. Folks. She's fluent in Python.
The way you get into politics in America is to computer program, Ali Martel, Right now, there was no.
Python going on in Utah for the left.
We saw the gentle lady of the Bronx and the gentlemen Vermont get in you two sized populations. The arenas were packed in Utah. Allie, you know there's twelve Democrats in Utah.
How did that happen?
You know?
I'd love to point to a chart that is in the retrospective that our team put out that you mentioned, where we look at overall issue importance to voters. And when you look at that chart, you see something very clearly that voters care more than anything else about their day to day material reality. They care about the economy, they care about the cost of living, they care about
the costs of their healthcare. And so that's something that we find not only do voters really care about it, but they're actually generally aligned with overall the Democratic Party on a number of economic focus issues. Voters agree with us that we need to curtail corporate price gouging, that we need to make sure that the ultra wealthy are paying their fair share. So we have some really persuasive thing on this subject matter.
And so but at the same time, if you look at that.
Same chart, you also see that Republicans still have a trust advantage on these issues. And so there's a branding issue here, but there's a lot for us to be working with because at the end of the day, a lot of Republican voters do actually agree with our economic platform.
Okay, well, let's keep scoring here, Paul.
To be clear, House Republicans won, Senate Republicans one white House Republicans won.
That's a score.
Paul go Alie talk to us about the Democratic Party today? Where is it? Since election day? We have heard nothing from the Democratic Party. President Trump has taken all the oxygen out of the room very successfully.
Where's a Democratic Party today?
Yeah?
You know, election night was obviously tough for the Democratic Party at large. There were a number of victories down ballot that are obviously getting overshadowed by what happened.
At the top of the ticket.
But you know, it could have been a blowout red wave that night, and it wasn't. There were a lot of victories in the House, the Senate, the state legislature's ballot initiatives, but obviously what happened at the top of the ticket was devastating and it.
Still wasn't enough. The trends that we're looking at, you know, one.
Of the things that makes it tough to reflect on is that there were a number of losses across the board with a number of different demographics. Trump had already been making in roads with non white voters for some time. We had already been seeing increased levels of educational polarization, where college educated voters were becoming more democratic and non
college educated voters are becoming more Republican. The thing that we were seeing specifically in twenty twenty four that you know, we're kind of talking about right now as a party when we look at who Biden won in twenty twenty that he had started to lose over the course of
his presidency. Those folks really had one big thing comment they skewed towards being less politically and less likely to Right's likely to view politics is important to their identity and so that is new for the Democratic Party, and it's something that was.
Still I got time for one more quick question here. We're going to have you back. This has been really really good, Ali Martel, Matt Eglesia's Rights for Bloomberg opinion. Democrats need more combative centrists. Where are they right now?
It is fair to say that voters are looking for somebody to step up and push back on some of the things that Trump is saying that he's going to be doing or doing that.
Is going to hurt their day to day lives.
You know, there are some potential, real vulnerabilities from some of the policies that the Trump administration is getting behind, and so people are looking for a change. There's a reason that global incumbents, not just Joe Biden have been losing left and right in this post COVID economy. People are unhappy Whitney status quo. So I didn't think that there's some merit to Ellie.
We got to run. Thank you so much. We'll do this again, Elie Martel with US of Blue Rose Research.
This is the Bloomberg Surveillance Podcast. Listen live each weekday starting at seven am Eastern on Apple, Corplay and Android Auto with the Bloomberg Business app. You can also watch us live every weekday on YouTube and always on the Bloomberg terminal.
Whitney Tilson joins us now and if you just need to know one attribute to Whitney Tilson, I'm sorry. It is the most coveted MBA distinction out there. It is a Baker schylar, real deal diversity.
Years ago.
Were you surprised when you were a Baker schylar, Like, were you sitting in your dorm room staring at the ceiling and they said, Whitney, good news, You're a Baker scholar.
Is that how it works?
Well, it's just based you know, based on your grades over two years. It's top five percent of the class and I'd been getting mostly ones, is what they call A is there, and so it wasn't completely unexpected, but yeah, it was, it was, it was. It was a real honor.
The race to me is original, and that, for example, was Scott Stringer with this huge liberal, progressive Jewish support from Bella absent and Jacob Javits back. It seems like the Fabrican character of our political system is breaking. Who do you represent in this race?
Fed up New Yorkers?
That's I got into the race because I saw a bunch of career politicians. This was back after the elections Scott. To be fair, absolutely thirty plus years, and I think the New York City is being poorly managed. It's headed in the wrong direction. And I didn't see any real change candidates in the race. And I saw how well this city was run and how well it did under
Mike Bloomberg. Sort of funny here sitting on a Bloomberg show in fact, and in the in years since he left office, under two career politicians and looking at a field of more career politicians. I think New Yorkers are looking for a change agent and I'm the only one in the race.
And of course Mike Bloomberg is the founder of Bloomberg LP and this radio vice apparatus.
Here, Whitney, what's your platform? What do you want to do here?
Mostly get the city's economy growing again. And we are an economic powerhouse. You mentioned how important New York is to the country. It's five percent of US GDP just in the five boroughs of New York. And when I go to all the mayoral forums and talk with all the career politicians and debate the issues, all we're debating is how to spend the tax dollars and which city program they would fund and create more spending programs. And I'm a business person and I understand our tax base
comes from our economic base, from wealthy and individuals. People invest in growing businesses. Everybody wants rising wages. The way to get there is growing businesses hiring more people. So I think we can grow this economy by fifty percent in the next ten years. That's about four point one percent compounded.
How does someone like Mayor Tilson speak to the constituency of someone we've had in many times, and that would be Greg Meeks of Queens. He's the leading Democrat of Queens. There's all sorts of constituencies under Congressman Queens as Congressman Meeks within Queens, how do you speak to the machine if you're an outsider.
Right, I'm going directly to the voters. There is no path for a first time candidate outsider like me to win a traditional race. But keep in mind, only twenty six percent of eligible Democrats voted in the primary last time. I think the other seventy four percent a lot of them didn't vote because they didn't they just saw different flavors of career politicians. So I've got to go around the machine directly to the voters with a message of change.
And if you look at voters, seventy five percent of New York City voters think the city's head in the wrong direction and clearly want change. And so I've got a position myself as the change candidate and go directly to them.
You see, you need to change the tax situation in the City of New York.
Well, I'm the only candidate to my knowledge who said
I will not be raising taxes. The number two candidate in the polls after Governor Cuomo, is a thirty three year old socialist named Zorn Mamdani, and he just came out yesterday with an enormous tax plan to raise corporate taxes, to raise taxes on the wealthy in New York, and we already have the highest tax rate in the city, excuse me, in the country, and I think the traditional tax and spend far left plan will would be devastating and cause further flight of our wealthiest citizens who pay
the bulk of our taxes, as well as our business base.
What investment can we grow?
People don't even know that there's a whole manufacturing heritage of the boroughs Brooklyn in all there's the romance back to one hundred years back or so. If there is business investment here, what kind of business investment is it?
Well, right off the top of real estate, we have a cute housing crisis in this city, a one point four percent vacancy rate, the highest rents in the country. We're losing our working class who literally can't pay their rent. But we've erected zoning codes, environmental rules, just a stifling process to get anything built residential and business construction as well. So that would be a huge areas.
Do you find evidence of support among Democrat traditional politicians for this idea? Got to fix the housing crisis in America or do you feel like a lone voice.
Actually, every candidate in the race is talking about this, but most of the traditional career politicians are falling back on their traditional nostrums of government spending, using federal dollars to build subsidized housing, and they generally speak disparagingly about those evil landlords exploiting tenants and evicting them and so forth.
And my view is the opposite. With federal governments cuts likely on the way, We're going to have to tighten our belts and the only way, the only big pool of money to do this kind of investment's got to come from the private sector, and we need to make New York an attractive place to invest.
So I'm a kid, I'm over in Switzerland. It's forced with Franks to a dollar. It's just Franks appreciate it a little bit. And I'm sitting over there across the valley Velde Reveld, and I can see Whitney Tilson climbing the matter horn. I can see him in the binoculars, just like the Disney movie that we.
All grew up with. What's it like? Not in the Disney movie, but Whitney Tilson, What's it actually like to climb the matter Horn. It was magnificent.
I've climbed the Mont Blanc, the Matterhorn, the Eiger, and then here in the United States. You know, really one of the iconic climbs of all time was the nose of El Capitan, which was featured in the movie Free Solo. But I did it with ropes and a guide, so you know, if I slipped and fell, I wasn't gonna I wasn't going to die.
But it wasn't like the Disney movie.
Yes, so you know, in some ways, what I'm doing here running for Mayor is a seven month extended version of some of the extreme climbing and other events I've done.
What's been the biggest surprise in this effort so far.
To the upside just what an incredible city this is and getting out into every corner, how incredibly diverse this is. Our immigrants, our communities are such a strength and an asset, and I think it's terrible that they're feeling terrorized right now. It's been heart breaking out and getting my name out there.
Do we need more police officers? Scott Stringer was adamant we need more police officers, do we?
Yes?
He's right.
Interestingly, also in the area of housing, but also in the area of police. A lot of the lefties are now tacking toward the center because New York voters are pretty upset. I've always spoken.
The last election that's the big thing.
Absolutely, But we're at a thirty four year low in the number of police officers right now in New York City. Not surprisingly, you know, crimes up thirty plus percent the major felonies since pre pandemic, and so we need to get more officers. And thank goodness, we've now got a police commissioner, Jessica Tissue's managing them well next month.
And you climb.
You got to take Lisa Mateo with you, all right, Whitney Tilson, thank you so much in the mayor race. What many other mayor candidates in with us here in the coming weeks.
This is the Bloomberg Surveillance Podcast. Listen live each weekday starting at seven am Eastern on Apple Coarclay and Android Auto with the Bloomberg Business app. You can also watch us live every weekday on YouTube and always on the Bloomberg terminal.
We're going to do the newspapers right now, a lot to it's a nice diversion from everything going on.
Divert us Lisa Mantale.
Okay, so we'll stick with sports since we got the whole.
Bad thing going We'll go to football.
Though.
We've been talking about the transfer portal, right, nil deals. Well, what it's actually doing is bringing into a popular college football tradition at a lot of schools, and it's the annual spring football game.
Right.
It's this intra game, you know, interra squad scrimmage.
It's huge, right because you had, like University of Nebraska had.
More than sixty thousand people like come out to this. But the thing is it's dying down, Like University Nebraska is not doing this year. They're one of eighteen programs from major conferences decided to just not do the event. A few reasons why, Okay, they canceled it for the element of surprise, okay, Others because the fears of players getting injured. But the big reason is, yes, the transfer
portal and nil deals. Coaches are getting paranoid that they're going to lose players by putting them out in such you know, like a big platform, because the roster is just so unstable it.
Can I'm a hacker, I have no idea. It's become pro sports period.
Totally, and every coach is are all the coaches are saying it now. So I I think, just what I listened to some of the experts here, you have to have some type of regulations, some kind of oversight. Okay, here, I was meeting with coach Kate last week down in Duke. I said, coach, why don't you become the commissioner of college athletics?
You fix it? And he said, no, no, no, no no.
Let me ask a dumb question. Who's the giant for Duke Cooper?
Yeah?
Does he get a degree? No?
No, he's not even on campus anymore. Probably had he had like a four point I know GPA. Of course he's I mean, he was an incredible kid. But no, he's gonna he's going to try to.
Give him a bee.
But it just goes to show you the impact that it's having.
You know.
Okay, So, Tom, I know you love space.
So I found this story.
Okay, is there life beyond Earth?
It could possible.
This was in the New York Times. Okay, scientists have been looking for it Mars Venus, But now researchers are offering when it says the strongest indication of extraterrestrial life. Okay, it's not in our solar system, but it's a massive planet. It's known as k TO eighteen B. It orbits like a star one hundred and twenty light years from Earth.
Not sure how dartrial, but it's far okay.
But what they're saying is that they did an analysis to the atmosphere and shows that this molecule that on Earth has only one known living stores like.
Living organized this marine algae.
So what they say is that.
If there, you know, ever is extraterrestrial life, you know it's going to take a long time to come, but it could be proof that you know, it's covered with like a warm ocean one.
Hundred and forty two light years.
All they got to deal is gone afterthoughts, bathroom and look at some of the makeup that's five years old from.
Five years ago. That old. That's signs of new life, Viginia.
You never know, we may not be alone out there.
Watch Contact Jody Foster's wonderful movie.
Yeah, that's great movie. Okay, so I got a problem with this next story?
You do really Okay, you're not a fan of this.
That's the stories and do I know, guys.
It's got the inside info.
Okay.
So Costco has their Kirkland signature brand, which but it's bringing customers to the beer isle.
Okay.
So they had the wines, the spirits did well, the beer never really did well. But now this new beer, it's their signature Hell Style Lagger. It's a Costco only released from De Shoot's Brewery and Bend, Oregon, Oregon.
It's a twelve pack price.
Said, thirteen dollars and ninety nine cents.
You can't be so Costco Kirkland Beer.
Yes, Costco Kirkland Beer. So it's made at this this particular brewery. But why they're saying it's a win win is because the way they go about it, so Costco partners with them to eliminate the sales and marketing.
Expense for the brewery.
So the brewery gets this expansive shell mershal you know, hi she But it's cheaper for the consumer that way too, and that's how they can order it for under fourteen bucks.
But this is the Bloomberg Surveillance podcast, available on Apples, Spotify, and anywhere else you get your podcasts.
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