Surveillance: Carbon Bubble With Gore

CUP twenty six. There are people that have parachuted into climate change that could not be said of the former Vice President of the United States, and with that there's no need to mention his name. Francine Lacroix with a gentleman from Tennessee. Yeah, thank you so much, Tom John and Lisa. I am delighted to be speaking to al Gore were the the original proponent of sustainability and climate change through for years and decades, has been trying to

make this a reality of Vice President growth. You so much for joining us. Thank you. Today's Climate Finance, it's we're focusing on the funding, on the finance, on how we transition better. I want to ask about your investment firm. This is something with the joint ventures with Golden Saxon, you're basically only targeting assets that are decarbonizing, which means that all the portfolios are well below the one point

five degrees. Is this how you do it? Right? Yeah? Well, Generation Investment Management was one of the small group that convened this net zero Asset Managers initiative, and it's now up to this incredibly large number of fifty two trillion dollars and it's part of the larger package that Mark Arney talked about. The rules of the road are are still being worked out in great detail. Uh. For for our part, we are actually committed to net zero, real

net nead zero. Uh. Some who have made this commitment are still working toward that man maximum goal. And I think what you're seeing here in this conference overall is a big wheel turning slowly. I think the world is awakening to the dire danger our civilization is in. And I won't go into all that, but obviously Mother Nature is making the point very powerfully and people are now responding, and in the finance sector they are now saying, look, we got to be part of the solution, and we

got to stop funding the problem. How do we turn the wheel faster? So, if you're an investor today, how do you avoid greenwashing? How do you avoid making the mistakes that then leads to probe saying your financial product is not s G enough. Well, in its essence, screenwashing is just a cheap trick that people are beginning to see through. Uh. It won't work for long. Uh. In the age of the Internet, people are ferretting out what's real and what's not it. It will take a little time.

But you know, society as a whole is now insisting that all of the institute usians of our civilization begin to respond to this with the sense of urgency that that's appropriate. And that's why you've seen this wave of E s G investing, albeit with a lot of greenwashing. Uh. And and as people begin to focus more intently, they're going to insist that they do it for real and get rid of this greenwashing. How do you measure success if you look at some of the things, for example,

investment products. I know we're waiting for a common language, we're waiting for taxonomy, we're waiting for a price on carbon. But how do you make sure that investors don't walk away from cop with a pat on the vaccine? We've done the job, but let's go back to business. The old way. Yeah, I don't think that they're going to be able to do that because a lot of the large asset owners, including pension funds, are are saying, you know, we we want to go with managers that are actually

committed for real and not just to pretend commitment. Um. And I don't think that there's gonna be a letdown after this. I think the pressure is on. Uh. This, this conference or cop process includes fifty thousand people, and a lot of the major commitments and progress that's being made take place outside of this plinary hall, take place outside of the negotiating sessions, but actually involved people who are in finance in who are CEOs of businesses and

they're hearing from their customers. But how much of a problem is that private money, as you say, is going faster than public money. And what can we do to change that to at least align them. Well, we need reform of the multilateral development banks, for sure. The World Bank is not yet on side. Uh. And the head of the World Bank is a perfectly nice guy appointed by the previous US president, chosen by him. Uh. The

staff is actually very good. They're in my opinion, but they're not yet really committed to helping as they should. There is a tremen into amount of work going on to try to come up with sensible reforms, not only at the World Bank Group, but Crystal linea George Eva, I think is a real champion here uh and and she is pushing hard to get these reforms in place. And then there are a whole group of other multilateral development banks, regional banks, national banks. There's a general awakening

among all of them. Here's an example, what francing. Uh If if you're a business in Nigeria and you want to build a wind farm, your interest rate is seven times higher than it is if you're in an O E C D country. That's insane. Obviously the market is perceiving risk of various kinds there. But that's what these publicly funded the multilateral development banks should be doing, taking that first level of risk off of the table and speaking for society as a whole and saying it's in

our public interests to make this transition faster. Why is it us not doing? I know we have an agreement on methane, but at the same time President Biden has been hamstrong with some of the politics back home. Why is this happening now, well, we still have a political battle to win in the US. UH, and it's a divided UH politics in the US, and UH the narrowest possible majority in the Senate. So President Biden, I think he did a fantastic job with his two days here UH.

And I think he's done a fantastic job in proposing a really meaningful climate package. But it's very tough when you have a fifty fifty Senate and a couple of the Democratic senators are not yet on board one for McCole state, so it's a challenge. I do think that in another couple of weeks, I think before the end of the year, certainly this package will be passed. It may be modified again, but I think it. I think it will be passed. We will that help with convincing

China to come on board or is it about including China? Well, yes, I think it has to help and bringing China on board. Yes, if if China can say you're preaching temperance from from a bar stool, as they say, then it lets them off the hook of it. But but I'm convinced that China is a serious about making its transition. They're building more solar panels and wind farms and the rest of

the world put together. They're still burning more coal than the rest of the world put together, and that has to be transitioned away much faster, and they can save money by doing it so, But the coal industry in China is as powerful as the coal industry in the US, and so it obviously is taking some time to make that transition. There's an old Chinese proverb I'm told that says the mountain is high and the emperor is far away.

I think that some of the regional governments in China have close ties with coal and coal related industrial opera rations, and it takes it's taking them some time to get them on board. But they've introduced carbon pricing in a in a chunk of their society. It's due to expand they have put out a net zero goal. It's far farther out than I would like it to be, but they plan their work and work their plan, and I

think they're determined to do it. Vice President. When we see how much green finance there is out there, I had a chief executive calling it tsunami of green finance. What happens to the companies that are not working on their transition. Now, well, I think we're in the early stages of a sustainability revolution. That's the biggest investing and

business opportunity in history. Uh. And those who don't recognize that and adapt to it are in commercial commercial risk of course, because they're they're going to be left behind. You remember the subprime mortgage of bubble that led to the Great Recession. We now have a sub prime carbon bubble of two trillion dollars based on an absurd assumption that all of that, all of those carbon fuels are

going to be burned. They're not going to be. They cannot be, especially because the new renewable sources of electricity are much cheaper now and will be cheaper in the world, already in two thirds of the world. So that do you believe that once we have a carbon market, or proper carbon market functioning with prices, that it reprices private assets? Yeah, I mean I think that once carbon risk, the climate crisis risk is internalized, then yes, it's going to affect

the value of all these assets. We've had this insane illusion that we can just ignore the impact of the climate crisis. But mother Nature is telling us no, not so fast. And these events are getting more extreme and more frequent, and people everywhere are recognizing it and they're demanding action. There's resistance, of course, and the legacy fossil fuel complex and the bankers that continue to invest hundreds

of billions of dollars in it every year. They remind me of the old cartoon of wiley coyote running off the edge of the cliff and the legs keep moving until gravity takes hold. We're in that moment now, We're in a transition, and those who make the transition faster are going to do better as a result. Vice President Gore, thank you so much for your time on Bloomberg today, and with that, I'm going to send it back to you in New York, John, and we'll have plenty more

from Glasgow. Cup twice France say thank you so much to you as well. Eric Adams is from Brooklyn. He joins us this morning. Congratulations, Eric Adams. I just mentioned you've done seventy two interviews this morning. How is your Wednesday? Look? Busy as you could expect, but exciting and I believe that Uh I want to be known as the g S D mayor get stuff done. Tram to really deal with the problems that we're facing in the city, and

I'm excited about it. I'm sure you'll accept a congratulations call from Mr Jesse at Amazon or Mr Bezos of Amazon. I'm sure you will tell me you would not have lost Amazon out of Queen's Amazon looks to move to Jersey City or at the margin, moved to Jersey City. How do you keep tech jobs in the five boroughs by doing what I have been doing for the last three months now. I had been sitting down with tech leaders ms, several Israeli companies and other companies here in

the city. Just two days ago I met with thirty a large tech startups and in the borough of Brooklyn we witnessed a three hundred and fifty six increase in tech startups in a tenure period. So this has been a place where I believe in technology and how we use technology to change the delivery of goods and services in this city. I'm not going to mince words, you know, it's a tough Bloomberg interview. That's what we do here.

What is going to be here? Change process. In the first thirty days from the mayor, you replace a safety zero in on gun and gang violence. We have to deal with the actualization of fear and violence and the perception because they both become a reality to people. So I'm going to institute an anti gun plane closed unit, of which is similarly disbanded by the current mayor, and

we're going to zero and gun violence. Okay, I don't interrupt here, but the news flow is so important Mayor that the district attorney elected maybe disagrees with you on the how do you put in process planes, closed officers to protect the citizens? What's how do you actually affect that? Well, some things. I'm won the distric attorney. He prosecute crimes. The police department. We arrest people that there is probable cause to believe they committed crime, and I'm not going

to mix the two. I think right now we are debated with the laws we don't like in Albany. We don't like the way he prosecuted the prosecuting crimes. That's not our job. My job is to make sure if someone has probable cause to commit a crime. I'm in charge of the police department. I don't need approval to put in place a plain close anti gun unit. And we're going to do our job and let others do their jobs. We're speaking with Eric Adams, new York City

mayor elect. Mr Adams. You know this is this is Bloomberg. We think about the markets, we think about um, you know, stock exchanges and and right now you know, as we know, New York City has been the global leader in global finance. I think that's still the case today. The future is going to be a little bit differently. We think about some things like crypto that is a big, big growth

of business within the financial services industry and technology. How are you going to make New York City a crypto friendly city, a crypto leader? Uh? And how would that benefit the city? Well, part of the meetings I have been having UH is to bring together the whole big cooin industry, and we need to do several things with it. Number one, we need to look at what's prevented the growth of big coins and cryptocurrency in our city. What

is it in the way of that. I met with the mayor of Miami and we're going to have a friendly competition. Uh. He's extremely inviting. He has a Miami Miami coin that is doing very well. We're going to look in the direction to carry that out. We're also going to do something else. We have to build out a pipeline of young people that can field these jobs and understand the new technology. Because we can't have a one sided city where certain groups and areas are doing

well and those of the inner cities are not. I'm going to build the pipeline to success in the city. Mary Adams. Uh, we have to wrap this up as you go of Bloomberg Television to speak with John Farrell. Good luck with that. Uh. And I'm kidding, but but but, Mary Adams, you walked in once is a tough kid in Brooklyn to precinct. That's not tough, that's fancy Fort Green. I mean, you're living large in Fort Green. You've got to walk in to a fancy Ford Green or some

of the toughest districts in this city. Is an ex cop with people who maybe didn't vote for you, maybe didn't get behind you because they have a more traditional view. How do you make peace with the line officers of the New York Police Department. Well, first, it's very important not to view geographical areas of the city during our current time. Yes, for Green is wonderful right now with multimillion dollar homes. But I was there when we were

dealing with real robberies, real crimes. And I also controlled this city at the transit cop during the mid eighties Ryan and subway system with a radio that did not operate alone by myself. So we start talking about tough, That's what I know. It's tough getting off the flow of a police and after you are rested, tough in a dishwasher, going to school at night, surviving education with

a learning disability that was undiagnosed. Tough is not something I'm afraid of, and tough is not something that New York is off radio. We're resilient and we're going to be fine. New York is bad. I'm Bloomberg Radio, Eric Adams with us. He will continue, I'm Bloomberg Television worldwide as well. Mayor Adams, congratulations and thank you so much for joining us as well. Boy Paul, is that a different tone from I mean, I'm not trying to get

into the politics of it. I will state as a fact that's a different That is a different tone, and it's probably reflective of what a lot of folks in New York City you're feeling, which is we need to kind of get control back at this city here. Um. And so that's certainly been one of the messages from Mayor elect Adams. And so again he'll have a you know, as you mentioned in your question, you know that's those first thirty days. Boy, there's a lot to get done

and and and setting the tone. I guess him longer than thirty days. But but to all of our audience worldwide and across this nation, unfortunately, what the mayor talks about on people's fears, it's true. It's across all income levels everyone. You just could feel it in the city. Ye.

And it's tangible. Yeah. And if we've we've seen this before in New York City, and if you could if you can get that under control, if you can get that managed, and then a lot of other things fall into place, whether it's investment, whether it's tourism, um and um. But that we've seen this before, and we've seen we have a playbook, and you know certainly would need to be adjusted for the times presumably, but that will probably one of the, if not the leading job for the

mayor elect on day one. You see how I behave myself? Yeah, very well, I said very well. I didn't say, Mr Mayor the pothole. If they haven't fourth Street, can we get that fixed? Exactly? I didn't bring up Street between six and exactly as we can do. We can rip up the script with Abby Joseph Coh and she has acclaimed at Golden Sax. She is one of the people that keeps the fearful in the market participating and David Costan's great bull market over at the Goldmen Sax shop.

We're thrilled at the advisory director and senior investment strategist at Golden Sex joins us this morning. Abby, I'm going to rip up the script and I can do this for someone who wrote Aristotle on investment decision making in the Financial Analyst Journal a million years ago. Abby, we're all getting length here. We're all playing the parlor game of extending the X axis. We've been here before, haven't we. We certainly have Tom and it's a pleasure to be

with you in the team. Another word we could use is protracted. Basically, there are several factors now behind the inflation that we're seeing globally. Some of these may prove to be transitory, yet protracted. That includes some of the supply chain issues but some of them do represent the sort of inflation that one gets during the course of an economic expansion, And the one that I'm looking at

most closely has to do with wages. We have seen a notable pickup in average hourly earnings, and on the one hand, that's terrific because it says something about the ability of consumers to continue to spend, and it also tries to get across the idea that we did go through an extended period prior to the pandemic in which wages were not quite keeping up. However, if those wages get embedded um in the economy, what we do see is that core c P I and more importantly for

the Fed core pc E UH moves up. But the expectation of my Goldman Sack economist colleagues is that we will start to see that calm down. One other point, if I may, and that is we're still in a period where you and your comparisons are really difficult to do because we are emerging from this extraordinary period. Now, a year ago, personal spending was negative UH. This year it's positive. So what do we think is going to happen? They're going to be some price pressures and they're going

to be some supply chain pressures as well. I mean, let's do some Cornell mathematics here, and it's about the rates of change and the dynamics involved, and we can look at wage growth is I I agree with your core theme there is well. The gloom Crew speaks of abrupt They speak of gross second derivatives and even harmful first derivatives. Your shop says, calm down, state why we should calm down and avoid the fear of dynamics. I

think we should calm down for a few reasons. Tom One is, as you point out, the mathematics, uh, the year in your comparisons are really fraught right now, and we'd much rather look at an extended period of what's happening and what's happening at the core level. The other thing we need to keep in mind is that there are several factors out there, three big ones that work in the opposite direction, that may suggest that economic growth will actually have the breaks somewhat applied, even if the

FED doesn't do anything. What are they? Number one, we are seeing right now a change in fiscal policy, and I'm not talking about the packages that are stuck in Congress.

What we're seeing is that the programs that were previously implemented are rolling off, and so the increase in federal spending, which was as you know, robust and equal to about nine percent of GDP earlier in the pandemic, is now going to be growing at about one percent, and if fiscal policy isn't changed, it will be down about two

next year in two So that's a bit of a break. Uh. The other thing that we have to keep in mind is that we are not seeing of the sword of wrote rebound that many had expected in terms of employment. Not talking about the unemployment rate, I'm talking about the participation rate, where there are many groups of people who are saying either they don't want to come back into the workforce, where they don't want to do it now. So this includes working moms who are having a problem

with childcare and their kids are not yet vaccinated. It includes retirees. Uh, the baby boom generation a very large cohort in the United States. UM. And let's not forget the missing immigrants. In the decade prior to the pandemic, about ten percent of the net growth in the US labor force was due to immigration, both at the lower end of the spectrum and at the high end very

skilled people. We've seen that reduce one more factor, if I may, and that is while the US and many other nations are slowly now emerging from pandemic restrictions, China is extremely tough on these restrictions. And China has roughly of the world's global manufacturing capacity. If they tighten up or stay tight, that has implications for economic growth. Everyone's been focusing on the supply chain and the inflationary aspects. It also has impact on the growth abby. All of

this sounds fairly negative. However, I wonder if the biggest pain trade in markets is not being bullish enough, because it's frankly supports the idea of real yields being as negative as they are, and they're being a supportive backdrop for risk at least been in monetary and fiscal policy standpoint. Do you agree that pain the pain trade is not being bullish enough, not necessarily being barished, potentially failing to

be so. Yeah, you know, the the economics team that I work with does believe this will be a protracted process that the FED if it does announce this afternoon, as they have signaled that they're going to taper, they will taple taper very gradually, and that the rise in rates from the Fed funds level in any event could be a year off. But we've already seen, as you pointed out earlier, that interest rates have already risen in

anticipation of this happening. And so the key for the stock market in particular will be economic growth and earnings growth.

And here again I would urge people to recognize that those year on year comparisons are going to be very difficult to do, uh, simply because we're coming from a base that was so incredibly depressed in many industries that to talk about that growth rate decelerating, Still good, earning, still growing, but the growth rate decelerating, you know, as as Tom would put it, the second derivative is not like but it's still going to be a good number. And I think I've just got a final question to

squeeze in. Are we doing the Tom Keane, Abby, Joseph coming Christmas mesh all this year? Is that happening some? It's up to Miss Joseph Cohen. Her people have not talked about can your talent sappy? Is it happening? I look forward to this every year? Are we doing it? I It will depend up on what Tom has to say. Okay, well, very good, whether I whether I get that invitation. I'm I'm I'm writing good Christians, John, Can I summarize that? I believe it was Joseph Cohen? Uh just predicted SPX

six thousand. That's what they took out that your inte for the Christmas special next stage six un you know, I'm sorry, David, it won't happen again. It will never happen again, David, Thank you Joseph Cohen again. Happy Joseph khin there of government sacks on the secuity market, surveillance fact, John Farrell, Lisa Bramwits and I all at gunpoint had to read Dickens Tale of to City. He read it

because he wanted to. Michael Gapon joins us on the tail of two tapers now chief US economist Barkley's investment Bank. How is a Treasury taper, Michael Gaping different from a FED taper? I think it's mainly because the Fed is a is a unique holder of treasury securities. Of course, they have different incentives, different holding periods, They're different actors. So I think it's it's more about yes on that

these two things are generally canceling themselves out. But the feed is backing out of the market is a very unique buyer. I think that's still the the main message. So I wouldn't take the net the net comparison too far. I do think the big news is the Fed. The FED will be tapering. The big news is they'll be tapering, and they will be cautious and conservative. Is the August institution is in this November. How measured will Chairman Powell be?

I think it'll be a fairly measured. Typically when the Fed it is tightening policy in some form, they like to offset it by giving you a little something on the other side. And and I don't think that's going to be a strong pushback against market pricing. I just think it will be an emphasis that the decision to taper and the decision to lift rates are two very different things. They have different criterion. The bar for lifting

rates is higher, and that's a long way off. So I think that's that's going to be what he'll try to kind of soft pedal to taper message with yes, we're starting to taper, Yes we're still concerned about risk to the outlook for inflation next year. Yes, there's a risk management component to this decision, but you know, really don't push this too far. There are two separate decisions. I think that's where his cautious will will come in. Michael, do you expect him to say that we expect a

lengthier transitory period going forward. I think that's so he were debating this in the last segment. It kind of has become a dirty word. Um, it wasn't in his press conference statement last time around. He didn't mention it in the press conference itself. That word trans the tory, it's in the statement. So yeah, I think that flavor

of that has to stay. I still think in general, their forecasts are all consistent in ours are still very consistent with a you know, a transitory or temporary impulse. The duration of it is just longer than we than we thought. So I think they have to find a way to keep that flavor around, but maybe back away from the pure usage of of that word. What's the potential market reaction if fed share J. Powell does not push back significantly against the idea of one or even

two rate hikes next year. Well, in the short run. It may mean that the market moves to to pricing more hikes, as they've done elsewhere. So and as certainly they did say immediately following Legard's press conference, uh, you know previously. So. But from the Fed's point of view, and I think they're right on this, it's a long way out for them. It's at least six months down the road for them. Given what they know today, they don't really have any incentive to push back strongly against

market pricing or or confirm it. So, you know, I think on this point, it's get the taper decision done, communicate that there are two separate decisions in terms of tapering versus liftoff, and kind of let the markets have at it. Michael, frame for us the immovable force of gross excess savings or I should say excess gross savings and also the immovable forces everybody's moving their terminal values out to a lengthier out. Put those two together right now. Yeah.

I think part of it is so there is this big pool of excess saving that's out there, and it's still we're just really now getting to the point whether we will know whether households are going to be drawing down on that pool of saving if if they do, because really right now it's government stimulus has faded out to the point where the personal savings rate is almost

back to pre pandemic levels. So you could see a situation now where the saving rate goes below let's call it low single digits, and we'll see whether households draw down on that. If if they do, then that's a situation where you could come buying that with with federal spending or infrastructure spending, and you have a prolonged period of above trend growth in in the future. Uh, and depending on where inflation is, that could be a longer cycle.

So I think that's how I would interpret it in terms of the contribution it could bring to demand, how long it keeps growth above trend, and therefore what it might mean for the duration of of the tightening cycle. Michael, have we reached the point where jobs markets, jobs data that we get as we're going to get on Friday, really do indicate a shift or something true or are we just still seeing the comeback of a market that was so severely distorted by the pandemic. I think it's

the latter. I think this is you know, we've We've debated about forecasts and the accuracy of models and so forth, and you know, we can do that all day, but I think this is one point where we in the economist community, I think have been pretty consistent. We've said, I believe it's going to take twelve to twenty four to thirty six months to sort this all out. So

I'm still in that camp. If you look at the at the data, for example, Bowl the data will tell you about four million people were out of the job market last month because either they had COVID or they were taking care of somebody who has COVID. So that's a huge number, and obviously that rotates over over time, and the in terms of who's been out of the labor force, it's it's mainly a married couple where financial resources generally can be shared. So one person is stepping

out for one reason or another. There's a lot of room for that to heal over time. We're not going to know in the next two to three months whether that changes. It's likely to be a long process. So that's my view is it will come back more incrementally and it's going to take six to nine to twelve months to get a good idea of where that is, Michael. Thank you, sir, Michael, gap in there. I appreciate the sound of a busy office, a busy trading floor. Yes,

it's going to have you back. Thank you, sir. That's always said the Glasgow, Scotland and catch up with Blimbergs trying in likewise, but we still morning, Francine, and we are still good morning John. I'm delighted actually to be here AT's a day four, because it started on Sunday a little bit quieter. I know there's a lot of noise behind me, just because there's a lot of the big Wall Street titans. I just saw very thing walks through the planary because today is finance Day. We also

heard from Secretary yelling moments, oh go. I am delighted to be joined now by the astro Zenica chief executive officers that Pasca saw you to talk about all things sustainable, and we'll also talk about the vaccines she saw you. Thank you so much for joining us today. First of all,

it's a little bit counterintuitive. I know astro Zenica has had some very good plans on Scope one, two and also three, but it's counterintuitive to look at the medicine industry and saying what you can do for sustainability Is it all about drug disposal? How much cloud do you think your industry has to actually make a real difference to e s g. I've been ring France and then thank you for having me the I think the pharmaceutical industry and the heavy scares sector as a whole can

make a big impact. The heavy scares sector or globe or presents about four percent of carbon emissions, so it's quite substantial. And we can, of course as companies, work on our own emissions, which you know as a company we have a plan to do that by will be carbon zero. From that view point, we can work on our scopes three and our supply chain and we are doing this as a company and I'm also working with

the rest of the industry to do that. And then importantly we can work with the healthcare sector as a whole, like the energys in the UK, to really make sure we reduce carbon emissions across the entire sector. So I guess the rest difficult thing is how do you dispose in this? How do you dispose of it in a safe way that's not damaging to the environment. How long a way. Do we have to go until most medicine

ninety five percent of medicine or safe to dispose of? Well, a lot of work is being done on this two. But disposing of medicine is really a slightly different topic compared to the carbon emission reduction we are committing to. But a number of companies are really looking at how do we actually recycle or dispose of our packaging of our medicines and and recycle a lot of this in in an environmentally friendly manner. Do you think that these

talks are we invigorating the infrasustainable? I mean, I mean Curry here is very energizing, I have to say, because I can sense the momentum is growing. Not only governments are really making commitments, and I know that we would always like to hear better, stronger commitments, but it goes in their own the right direction. And importantly, the private sector is not stepping up. Yeah, and now we need to look at the details and where the money is

going and how you hold them accountable. But speaking of commitments, what's your commitment to vaccines? Our commitment to vaccine is really to bring this vaccine to as many people as possible around the world, and so far we have delivered one point at billion doses of vaccine globally, mostly to the low medi on income countries, and so we are

very proud of this. Many people, thousands of people have worked day and night over the last few months to really deliver this vaccine that is making a huge difference in many countries around the world. Which actually, what do you make of the US of the new US pricing bill? Actually in drugs, it seems to penalize some of the

smaller molecule drug development versus, for example, some of the biologics. Well, you know, I mean we it was clear that something has its clear something has to be done in the United States to help patients get access to their medicine at an affordable cost um. So we really welcome this proposal to introduce a cap of two thousand dollar cap

of out of pocket costs for patients every year. That will really help them take their medicine with that, you know, the difficulties the face today, and we also understand that something has to be done, and it's a negotiation between industry and and all. The circle doesn't and I think we we have to do this without destroying innovation, which has been mostly in the US over the last number of years. Actually, I believe that what the discussion is

going on today is really getting there. Actually, I understand you know that the new bill so removes incentives to test kids. What do you make about to test children? Um, this I'm not aware of. I have to say I'm sorry about this. But but the the discussion and the decision that has been communicated overnight. Um, he's really balancing quite well, reducing price, negotiating the price of sound drugs,

but at the same time protecting innovation. I mean, is it you know, is there a danger that, because of the pandemic, which I know has put really health at the forefront, which means that a lot more people are engaged with your industry, that as you're dealing with the pandemic, it will not incentivize other companies, drug companies, healthcare companies to decarbonize. Oh, I think the whole industry is actually

committed to committing not to the carbonizing. I you know, I'm part of the task force within the SMI, the Sustainable Market Initiatives launched by his oil hand as the Prince child and as an industry we're working together to the carbanas and reduce our carbon emissions in an accelerated manner.

So it's really quite exciting to see the pharmaceutical companies coming together to work with our suppliers, but also to work with and A, chess and other health scare systems around the world so productively we can really reduce the footprints you thanks so much for joining us. He is, of course, the chief executive officer of astro Zeneca. Yeah, another important story developing through the week over in Glasgow, Scotland. Let's head back to catch up with Francine lay Friend. Hi, John,

Thank you so much for that. I'm delighted to be joined by the President of Costa Rica, a President Alvarado, to talk a little bit about his country, some of the pledges here and of course what can be done to save the planet. President, thanks so much for joining us right here. Life on Bloomberg surveillance. Nearly a quarter of your landmasses under some sort of conservation. You're doing extremely well in terms of energy production electrifying into more

renewable sources. The big concern is transportation. About fifty of your emissions come from transportation. That is still dirty. How can you make it cleaner? Well, thanks for the opportunity. It's a pleasure being with you in Bloomberg. Well, it's true that our main fund print and falsil carbon fruit print console transportation. Our electric grid. The electricity we produces nine clean and renewable. So our great opportunity is to

electrify our transportation. So far, what we have done we have increased the number of electric vehicles in Costa Rica. We are the we have the highest per capita number of vehicles electric vehicles in the region. That's one and for that we have a tax relief on electric vehicles and also we multiply the stations to charge vehicles so

you can go all across the country. Second, mass transportation, we're building an electric train for are the main cities eighty it's a project of eighty two kilometers and it's also an electric train from clean electricity. What kind of timeline can we actually see a meaningful difference? And we look at the cars, what's selling? What do people want to buy? Well, our timeline we launch it by February.

We were the first to launch our decarbranization plan and we have a pathway from now to twenty fifty, but by twenty thirty, we have to see a strong progress in the electrification of our transportation to dramatically reduce our carbon footprint. And that's what we are I mean also with new schemes of public transportation, because we're not only targeting to private vehicles but also public transportation to cleaner,

more efficient. The person talking to a little bit about carbon market, First of all, are you pushing for some kind of carbon markets offset? That will happen very quickly. I know Panama is getting involved in carbon you know we're going to have a price for carbon. Well, that's one of the big discussions, and actually that's the discussion our Article six that's going on in the negotiations during

this cup. Yes, we're pushing for that, but I think one of the great discussions has to do with first with trust, trust in the developing word that we're going to implement the measures, and also trust from the developers that they're going to commit finance, both public and private. We have seen advancements and we have seen schemes, but there are still too frial. I was gonna say, have you seen enough? I mean, it's a billion enough yet?

Right when will we see it, and how much pressure are you putting on some of the developing would be we're being very open. I mean whenever I address the floor a couple of times that I've done, I've been very open and frank, because you see, there's the discussion of the development countries are too risky. But here the only risk I see is that if we don't act there, there won't be any planet anymore. So I don't see any risk higher than that. One risk is a matter

of u S measure also in time and framingess. And you feel cheated by some of the top of metters. I mean they also come from the developments of the word. I think we need to to go further in our commitments. I am confident because as as as humanity, I am optimistic. How must the meat on the table to be sure to implement some of the strategies that you have from

developed economies? Well, for example, through our policies like the Hambition Coalition Forever Nature that is pushing to preserve thirty percent of oceans and forty percent of lands. So far we have we have we have gathered the support of

five billion dollars through philanthropy and that's a great start. Yesterday, Colombia, Ecuador, Panama and Costa Rica were together announced the Protection of our Oceans area, which is going to be one of the largest in the Pacific and that support there also by philanthropy and by all the contributors. We're in conversation with the resident of Costa Rica when you look at some of the things that have been on the table and what more can we you know, can be done.

You're still dealing with a pandemic. Costa Rica is an open economy. The pandemic and COVID nineteen is not out of control. Is there danger that it derails you and other countries actually in developing economies from reaching some of the sustainability targets. Well, that's one of the great risks. In our case. We have for the objective population twelve age and older, we have more than eight eighty six percent of a population with at least one doses, more

than sixty with two doses. So we have advanced in that direction. But the fact, for example, that Africa's has just five percent of people backs in it is a great risk, not for Africa, for the rest of the world. So then we need to tackle that because a new variant can take us to the beginning. So we need to tackle that second grade risk. And this is for emergent economy, miss for the developing world, for Latin American

and the Caribbean. We've seen an increase on our fiscal deficits because we have to increase expenditure to tackle the pandemic, also increase expenditure to tackle climate change. Extreme weathers demand governments to invest in emergencies, for example, and at the same time do pandemic. We have seen a decrease on the taxes we collect and those fiscal deficits are a new risk that we face. We are facing a dead risk throughout the region. All right, thank you so much.

Is it nice being back in then here? You studied here, Yes, studied here. No, it's great. The only thing I didn't miss is how cold it is. But I know it is. It's freezing in Glasgow. Thank you so much. The President of Costa Rica. With that time, I'm going to hand it back to you. In New York, I imagine it's warmer. I'm I'm not sure. Here it is pretty cool even in the Congress Center France, saying I did not miss the weather dint I miss you, I don't miss the

weather France, saying thank you very much from Glasgowscon. This is the Bloomberg Surveillance Podcast. Thanks for listening. Join us live weekdays from seven to ten am Eastern on Bloomberg Radio and on Bloomberg Television each day from six to nine am for insight from the best in economics, finance, investment, and international relations. And subscribe to the Surveillance podcast on Apple podcast, SoundCloud, Bloomberg dot com, and of course on

the terminal. I'm Tom keene In. This is Bloomberg