Surveillance: New Global Equilibrium with Haass

Find Bloomberg Surveillance on Apple Podcast, Suncloud, Bloomberg dot Com, and of course on the Bloomberg Terminent Right now, a treat Richard hass as a President of the Council on Foreign Relations and far more than that with his public service to the nation in Northern Ireland negotiations Inbassador hass joins us with my book of the Summer a number of summers ago the world a brief introduction. Clearly it needs to rewrite hass rumor to have a book out

in January. We're thrilled the Ambassador could join us this morning. Richard Austin your newest essay see it folks at my favorite project syndicate. You talked beautifully about American overreach. There's all these phrases in the Richard House world, the classes of civilizations, the post American world, and now American overreach. What will our new overreach look like? Well, this has

become an assumption. Tom in the wake of Afghanistan and the two thousand three I Roq war, But the biggest problem facing American foreign policies we were trying to do too much. Now you have the Russian invasion of Ukraine, and it's a reminder that classic geopolitics have not gone away, and that the new danger and might not be overreach, but might be underreach, which is simply another word for retrenchment or isolationism. And we've seen voices calling for that

in both parties. And I actually think one of the things coming out of this crisis is going to be a new eak equilibrium. We've already seen some new signs of that, some initial signs of that in the administration's budget. National security spending is going to go up. But the United States now faces the world of a Russian threat to Europe, Chinese assertiveness at least in the Asia Pacific. Iran has not given up its nuclear ambitions. North Korea

is expanding its nuclear and missile capabilities. You've got a raft of other global challenges, so Linda world looks to be a very dangerous place. The United States has got to address them. The new isolationism. It can't be the Chicago Tribune isolationism of our parents, Richard Haas. With the modern technology, the speed of information, the reporting of intelligence by the United States in the uk of putin, the speed of news here means it's a new isolationism. How

do you see that playing out? Well, it makes no sense. Think about it, Tom, We're just two years out of a virus that began in Wuhan, China and killed nearly a million Americans. Climate change effects us every day. We just marked the twentieth anniversary of nine eleven. To be isolationist in a global world, globalization into reality, it's not a choice. The choice is how we how we deal with it. So American isolationism now is truly truly a

self defeating and dangerous fallacy. Richard. Let's talk about the here and now, right now, about these conflict, this war in Ukraine and what this does to the world order as you see it. If we're talking in big geopolitical strategy terms, how much is there a winner and how much is there a loser? Well, there's more losers than winners, which is almost almost always the case. And more that said, NATO has come out of it in much better shape than than I was. I think the Biden administration has

handled this fairly well. For the most part. The EU looks pretty good. Germany what what a what a turnaround? Ukraine is both tremendous resilience, but look at the destruction to the to the physical plant of the country. A quarter of the people are now on now homeless, either displaced or refugees. I think they're the big loser more than anything else, will be Russia. Look what Russia has done to its position in the world, to it to

its economy. It's beginning to lose some of its best and brightest, and its army looks like a potempic in military. So out of all of this, I'd say Russia is the biggest loser, but also increasingly all a dangerous loser. We don't know how Mr Putin might react to this, how he might lash out, how he might even escalate. When you talk about how NATO is a winner in Germany in particular as they try to strengthen their place, what's your view on how lasting this move away from

Russian oil will be? How much can the Western nations actually effectuate some replacement for that nation's reserves. It's a great question. It's two parts of One is the physical part of transitioning out of dependence on Russian gas. In particular, we're talking about years in this country. We're going to have to build the ability, the ability to export liquid net liquefied natural gas. Europe is going to have to

build the capacity to import it at scale. That's something that happens that over over years, not not months or weeks. And then the question is whether the pole tis a there. That depends, I think, on what Russia looks like over time. Do you do we get to a post Putin period. If we do, I expect they'll be voices in Germany that will say we can now relax some of the sanctions. Some of the old fishers within the Western Alliance will begin to re emerge if you see a changed Russia.

But at the moment, you know, we can't. We can't count on that. That's not a strategy, that's simply a hope. Richard hass was the were the realist correct? Was John Muir Steimer and others? Publishing in your magazine, you provided leadership on this debate where the real politic crew correct? Tom. I think this is one of these debates about whether we mishandled the end of the Cold War. It's going

to go on for some time. This is one of those rare cases that even hindsight is my own view, as we did mishandle in some ways dealing with the Russia in the years after the collapse of the Soviet Union the end of the Cold War. But I also would point out that doesn't in any way just the fire explained what Vladimir Putin has done. You can you can say both things. We mishandled some of the post Cold War diplomacy, but in no way does that by

a warrant what Putin did, Ambassador. Let's get down to the nitty griddy in two thousand and eight, I believe it was at Pratoslava. Could be wrong on that. I can't remember where the meeting was. Yeah, thank you, Boko started with a B. What do I know? The answer is Condi Rice and Richard Gates got hammered. They didn't listen to the prose about what to do on the Eastern Front. Are they gonna listen this time to the pros that are nurtured by institutions like what you've built?

A cfire? Full disclosure, folks, I'm a member of CFR, so I'm talking to my book. But they didn't listen in two thousand and eight, did they? But Tom the Foreign policy espous, it was divided you and Democrats and the Clinton administration medal at all right, I made her memory be for a blessing. Was one of the advocates

of NATO and large. But so is brig Brisinski, Condi Rice, as you say at two Ashdated and Bucharest with Steve Badly, that was that was the view even now you what people will say, we should have done more NATO expansion. That's the problem that that NATO has never expanded to to Ukraine. And then you have just the opposite point

of view. We don't know what Russian political culture would have would have emerged as so we don't know whether NATO enlargement and the mishandling of relations with Russia brought this about or would have come anyway. That's really one of those debates that won't end. You said, like now Ferguson, let's not do the counter factual thing. Richard has bring it forward for the next Secretary of State. Which way

do they till Rice or all Bright? I would say what we want to do is limit our involvement if we can in Europe. That's not the critical arena for the twenty one century. Tom I would say say, we want to free ourselves up as best we can to deal with China, the Indo Pacific and with global issues. Century is ultimately not going to be decided in Europe. So what we need to do is manage things in Europe, put a ceiling on them so we can focus on

global issue is out on other geographies. Clinic as always of the Council on Foreign Relations, Richie, thank you, thank you very much. One of those sites of the four Salt minds, if you will, the salt caverns, John Is, Scenic West Hackberry is where we'll get those millions of barrels or whatever we're doing. And that is about the strategic petroleum reserve and it is something that will affect

the global price of oil. We are advantaged with all of our coverage founded by Stuart Wallace, Javier Blass and the rest on hydrocarbons, and we get expert view today from KPMG, their global head of Energy, Regina Mayor Regina. I've got to rip up the script here and take it from the strategic petroleum reserved to your visit in recent days to the United Arab Emirates. We spoke to the head of their energy policy who stayed on script.

I need you to get off script. What is the power of the peers Engulf to affect global price and diminish Mr Biden's efforts to lower price? The Okay plus producing nations definitely have the power to lower prices right now that I was struck by that, the confirmation that there is spare capacity in both Saudi and the U a e UM, But there is a sticking to the script that all of them are are focused on. They have an agreement, that agreement has been in place, and

they're sticking to the agreement UM. And then they'll I think that gives a little bit of a buffer from some of the the external um pressures that might be facing them. And then when you ask each of them independently write of you a you will say, well, we're

just ten and there is an agreement. So I was not surprised by what came out of a twelve minute meeting take us from Doha to a Bloomberg surveillance conversation with a Secretary of energy a number of months ago, and the point of the argument was the one price of oil. Is that true that Mr Biden and the for salt caverns have to deal with a global oil

price or they can they manage a US price? Well, I think that the challenge for the US administration is that gasoline prices more closely correlate to the global oil price, which is tydemore to Brent versus w t I. So we do have abundant US supply, which we still have a challenge of getting out of the ground, labor shortages, costs, et cetera. But the price of gasoline pivots more closely with the price of Brent, and that's where OPEC plus

and some of the other suppliers come into play. Regina, we're looking at this oil reserve release potentially as reported by Bloomberg, that could amount to a hundred and eighty million barrels in some after all of the months are added up. How much does this actually reduce the strength of the US basically diminishing the reserves and actually propping up prices even further later when they try to rebuild them.

Great question, but you know, if you if you believe some of the other analysts like Secretary Munees that was referenced earlier. There is a belief that towards the end of the year, supply markets will balance. So if there's an opportunity to diminish some of ooplex influence in the short term and ease prices at the pump for consumers,

then that's the wise decision to take right now. I worry less about what it does to our our defense ability in the future and the cost exposure, because I do think well markets are poised to settle down in twenty three Regina to double down on that point that Ernest means and you you echo that we're going to have more of a balancing and the rest of the year, what does that assume, the end of what's going on in Eastern Europe, the bringing back on some of the

Russian barrels or other sources as production increases in the US. All of the above, plus I think the one thing we said that maybe you left out is that the current price is an incentive to non OPEC producers. So a lot of plays are in the money, and I think people will do what they absolutely possibly can to bring more of those supplies to the market so they can monetize. Think Canadian oil stands, you know, think investments

in Mexico. So there are other sources of supply. Guyana and the fine that we have there that I do believe will come into into the market, and that's what folks are counting on to help ease the supply crimes. Regina, can you just clarify something for me quickly? What is the SPN for and it's just the right way to use it? Well, I've actually don't feel qualified to comment on that, John things. I think it's it's a lot about our defense of our our country at you know,

fuel is a really important commodity. I grew up in Hawaii and I remember the seventies sitting in the back seat of my parents car for hours on end on an auto even license day, waiting to be able to fuel up our tank of gap you know, are so that we could drive around a small island. So I think that's what it's intended to try to buffer, and that we could get gosh forbid, that there would be

a large conflict. We have those supplies, and I think it's pretty important, Regina Man, Thank you, kypmje Nila Richardson joins us right now chief economist at a DP. That was important, of course, we're their Wednesday effort on a DP statistics on the American labor economy, Nila, let me start with Richardson one oh one. Are we a fully employed America? Now? We can't be as long as a

million workers are still on the sidelines. And you know the labor force participation rate is below pre pandemic levels. But that goal is moving. What is full employment with a smaller workforce? It is defined as the level of employment the large the largest number of employed people the economy can support without a spurring additional inflation. And so that's going to be a moving goal as inflation hopefully

comes down over the course of the year. Neil I was passing through the data and frankly, the most interesting aspect of this was real personal spending, which was down by zero point four percent negative. We're looking at negative numbers. People are not spending as much as inflation is going up. Is this a signal or simply a blip? Well, you can't answer that in one yes or no, because consumers

are very bifurcated. Low income consumers spend what they have so that little increase in personal income, if it was too low income households, that's actually a good sign for spending going forward. High income households spend when they feel confident about the economy, and there is indication that consumers are not confident with inflation this high. So it's a mixed picture right now in terms of where that increase

and income landed. If it landed with the low income, they need that money to keep up with rising fuel and food prices, and you might see that translated into consuming we're spending. If the Fed we're looking at this data, do they get comfort from seeing a decline in real spending in some ways? Do they want to see a deceleration in demand? They want to see a deceleration and inflation, not so much a deceleration in demand. Unfortunately, you can't have one without the other. They want to see an

economy that continues to grow. Uh So, I think that they're very careful of where they're the demand is being contracted, right, they'd like to see it in house prices and rents. Uh not necessarily though, in incomes and wages um But that that is going to be the challenge that they have this very blunt instrument. They can't control where the demand can be tacks in the economy neily, you have

a huge advantage no one talks about. You're going to the secret combine of a DP and you calculate all the pay rolls and all the corporations using a DP for that core automatic data processing services. What are corporations doing right now? Consumer seventy of the economy. I'll let you tell me what corporations are eleven? Maybe it's fift of the economy. What does a DP? And you see is the doing the action of corporations right now? They're trying to figure out how to hold onto their people.

We have a very low jobless claims number. It's not as low as it was last late week, but it's awfully low. And you pointed to what the cultural notion of this is. The cultural notion in terms of the business climate is they are very reluctant to let go of people because they don't know if those people are going to come back. We have a very high quiz breath, that is elevated job openings hovering near record highs, and

hirings are not keeping up with openings. So right now everyone is very focused big clients, small clients UM on retaining the people and hiring in a highly competitive environment for talent. When we're talking about the corporate outlook, Miila, let's end where we began the show, which is really restoration hardware and this call that they had where they basically through the kitchen sink at their expectation that growth

would decelerate and that their business outlook would deteriorate. How much is that representative of the larger corporate universe and face of the inflation and the consumer where they are versus perhaps a more specific or ambiguous story look as the economy as this recovery matures, what we expect um is a shift in consumer spending from durable like furniture over to services. Um that's what we're waiting for. The problem is uh that that served this increase is capped

by employees. If services can't find the head count, especially in leisure in the hospitality but took a large hit from the pandemic, then we are not going to see the growth. So it is a macro story in terms of durable goods like furniture, like big more big ticket items, but it also is about this transformation of the economy up through the recovery back into services. Nina always an education. Thanks for being with us, Nata Richards in that of a d P, let us save ourselves with Anders Crossed

Assets strategist at Morgan Stanley and Andrew Wey. What you do is you combine in so nicely all the fractious and folks. I say this with immense respect, the fractious debate of Morgan Stanley and your single phrase is solid growth. What does solid growth mean for my two thousand twenty two? Yeah, thanks, good morning, Tom, great to be here with you and

everybody else. So solid growth to us means that growth is lower than where it was in one but one was was a very high bar that was extremely strong global growth. And two we think will still look pretty reasonable by the standards of the last twelve years that

we're still looking at. You know, US GDP growing around four percent this year, and even though we think we have a very disappointing first quarter in China, ultimately the four year growth we think will still be a pretty pretty reasonable and that Chinese growth will re accelerate as the year goes on. So when we're thinking about stay inflation, I think we're thinking about a year much more like

two thousand five. We're p m I S or decelerating inflation is higher, policy is tightening than than something where growth is really falling off right now in terms of what the market needs to deal with, Andrew, the research you've put out recently is that we've priced in higher interest rates but not the growth risks associated with it. Can you pull through the equity market force and help usunderstand and where you think that needs to be priced

a little bit more? Yeah, So I think this is where some of the debate around the yield curve, which I'm sure is something we are now going to be talking about for the next six months UM, is really interesting because I think what the yield curve is discounting is higher odds of a growth slow down next year, which which we think is correct UM, and that certain asset classes are going to be more vulnerable to that

than others. So, you know, when we think about the overall equity market, when the yield curve inverts, it doesn't necessarily go down. In fact, it tends to keep rising after that inversion happens. The the equity markets balancing. Yes, there's some greater risk of recession, but there's also a possibility that things continue on for another twenty four months. But assets that tend to be more growth sensitive, something like US high yield that tends to see a pretty

bad risk reward when the curve inverts. When this when the odds of a recession are rising, and that starts to really underperform after the yeld, after you'll curve in version. So we think that favors somewhat more defensive positioning within the US equities, things like healthcare utilities. We think that favors investment grade over high yield within within the US credit and then some of the non US developed markets we think could be in a better place, a largely

better place because the financial conditions there are easier. Policy is under less pressure to tighten in Europe and Japan, and so I find the banks called fascinating at the moment. Betsy Gresik made a move earlier this week. Can you walk me through how um in a team thinking about the financials? Yeah. So, so we downgraded financials from from overweight, which had been a favorite sector for a while, down down to equal weight. And you know that the reason

for that is is a function of both. We've we've had a very large, large inister straight move that that helped the sector. But also, you know, financials as you start to get later in the cycle, have to balance

both loan growth that is often still strong. Banks continue to lend even after the old curve flattens with the market and thinking well, if the odds of a recession are rising, we need to price in a higher risk premium around higher loan losses eight twenty four months out, So you know, we think the sector's risk word is now a lot more balanced here again as those two factors are competing against each other, you know, and after we've had a pretty large rate move, and so that

leaves us more more balanced and looking to reassess, Andrew, where do long bond stit in your portfolio given the sell off that we've seen to date, and given the call that you have that we're in the same kind of environment longer term even given this blip. So I think that the backdrop favors a flatter and more inverted curve.

That's that's very much the way that our our interest rate strategist at Morgan Stanley are thinking about that, and and that we could even have a dynamic where the two year rate continues to go up towards towards three percent, but the the thirty year bond does not rise in yield from here, maybe it even declines a couple of

basis points. Again, as the market is looking at very strong we think structural demand for longer term duration and also as overall yields rise, the funding position of pension funds gets better. That increases the desire to to buy long duration assets to defease those pension liabilities. So we think longer term investment grade bonds offer better value here

than say HI yield. We think some parts of the Emerging market credit index will offer better value than say emerging market equities here, again in part thanks to the longer duration of that index. And we certainly would put ourselves in the curve flattening long end out performing camp. And I know you've been building cash and that Morgan Stanley's approached generally has been to hold a bigger portfolio

of liquid assets. At what point what signals are you looking for to shift that to deploy more and to go more into risk. Yeah, it's a great question. So so one, I mean, the equity market is clearly rallied back very very quickly, and more quickly than than we expect it. So, you know, certainly, certainly lower prices, but more specifically a higher equity risk premium would be helpful. What we've seen is, you know, on our measures, a

real compression of the equity risk premium. Uh, you know, a large richening of equities relative to bonds in a in a short period of time. I think more more space opening up there would be helpful. I do think, you know, the investment case in in in Europe could be a lot cleaner if we saw somewhat more certainty around the direction of of the conflict in Ukraine, and that could I think certainly improve the risk reward as we think about that market. Um. But I do think

for at some level the die is cast. Um. You know, we do think we're in a later cycle environment. A flattening yield curve, low unemployment tightening policy is a part of that, and I think that that at a broad level is naturally going to constrain how much risk we think investors should take. Um, you know, kind of regardless of these other factors. So we think this later cycle environment is often one where wants, one wants to be

closer to home in their portfolio allocation. But you know, we would be looking for greater risk premiums to emerge in inequities credit that we think would compensate for those risks before redeploying cash. And just quickly, how's London? How are things right now? Because when I call family, they talked to me about how much everything costs at the moment. They tell me house price to through the roof. What

are you experiencing in the general economy there? What does your actually look like from your experience in the UK at the moment, So you know what we talk a lot about stag inflation. I think the stag inflation story varies a lot where you talk about it. Right, you have very low inflation in Japan, you actually have quite good growth still in the US, I think the UK

is closest to that stagflationary outcome. Growth here is weak and make it weaker as you see very large cost of living increases bite even starting next month as utility bills rise. At the same time that inflation is still very high and where the current account deficit is still large. And so I think the Bank of England has a real,

a real challenge to it. I think on a structural basis, we are thinking that the pound will weakend against the US dollar or the Canadian dollar um and you know, I think the UK does face a tougher macrec backdrop than the European Union or the U s Andrew Shaye Silson as a wife of Marcus STANDI thank you, sir. It is claims day in Job Day tomorrow. It's very early, Paul. We didn't need to explain this. It's usually the first

Friday of every month, but it's never the first. They always then go seven or eight or whatever the number is. And John John Fields like Monday Jobs Day. This is I'm like, no, it isn't on air exactly, and it was like, Tom Glad you're read in, always read in as James Glassman, who really begins our jobs coverage. He is acclaimed at JP Morgan in commercial banking and really with the pulse of the nation. Jim, I'm gonna go

local on you in Los Angeles. And this comes off an article today I saw that's some mayor Adams in New York City and many other big city mayors dealing with crime and the l A Times today, Connor Sheets has Maxine Waters overwhelmed. You know, one of the most esteemed politicians we have dealing with poverty, Maxine Waters overwhelmed by crowds, on the homeless issue, on the crime issue.

In cities like Los Angeles. Are we really seeing a migration from troubled cities to new less troubled cities, you know, Tom, it does seem so. When you look at the flows

of data. Part of the problem isn't so much that it's a sort of things got really expensive on the West Coast up in New York area, and you're you're seeing a population that's flowing inward a lot of I think for a lot of people, they're figuring, well, if I can work remotely for a few days a week, I can afford that place for the rot I don't have to commute as much. So there there definitely is

a flow. And when I look at the flows from California, for example, uh, and out of the northeast, you can see that, Uh, what's going on is there's a heavy flow moving into the southeast, into Texas, into the Mountain states. Did the pandemic accelerate this, like so many other conditions, are we are we basically a Jim and Paul Jim is so good at the ten year timeline. Did we squeeze seven years into two years with the pandemic? Doesn't feel like that, doesn't it? Uh? And there's a reason.

I think part of it is if you, if you work in the technology sector, you're used to working remotely, and I see you know why is that the places like court A Lane and the Utah are booming? Yeah, but Paul, my stuff, Jamie Diamonds listening to us five days a week. Jim, if you call in and say I'm work from home, What's Mr Diamond gonna say? Well? I think we want, we badly want people to be back on the team, back home, back in the office, because that's where you learn stuff and that's how you

build culture. So we all want that. And depending on the business you're in, some some businesses don't need that. But I think over time we're going to find that we migrate back to the way we used to do it, because, yeah, we don't like commuting, but the truth is we're much We build a better team. When you're together, we're opinion free. But did you Yeah, I'm with you, I'm with you. Hey, Jim, what's a gallon of gas out in Los Angeles today? Oh? My god, I see I paid six and a quarter.

I've seen prices of seven. Yeah, I mean the quarter too. Yeah, you're paying six and a quarter to go into the glass hummer a three. Yeah, Well I've I've cut the trips. You can cut down the trips a little bit and save yourself if you work really hard, cut the trip to the mall, or you really work remotely for one day, you can sort of off set this. But now people are I don't see anybody when you look at the highways, drive on the highways. It doesn't look like people are

cutting back. So inflations here, Jim. Just you know again, six and a quarter for a gallon of gas in the Los Angeles. What is your inflation call? Is that? How effective do you believe the FED can be in terms of dealing with the inflation pressures? We see, Well, what the FED is? The FED can't do anything about what's going on right now. They can't get the microprocessor chips to the auto industry, they can't get the oil prices down. This is all about the dislocations going on.

But it's important for the FED to get back to the sidelines. And that's really to me, what's going on. If if you think that the FED moving the rate up from where they are now to two and a half percent, it's going to fix this, I don't think so. The whole, the whole, the game at the FED is to just get back to a neutral position, hoping that by the time you get there next year a lot

of this inflation stuff will fall fall away. I personally think it will slow down this year, and I'm I think it's interesting when you look at the bond investors views, you look at the implied inflation expectations that bond investors, most people think this is going to settle back to where we were now. That may be wishful thinking, but that's the view, that's the professional forecasters view, that's the

bond investors views. I think we all know there's something weird going on right now with all these dislocations, and it just takes time to work them out. So, Jim, one of the issues that are that will be focusing on tomorrow here at Bloomberg Radio and Television obviously, is the Job's report, and again the consensus is four ninety thousand change in non farm payils. But what I'll be focusing on equally will be the wages. Is wage inflation something that is in this economy, should be in this

economy or not? Uh? You know what's interesting. Wages, Yes, wages are growing faster than they were, but they're not keeping pace with inflation. And by the way, even though you've seen labor pay growing up, margins have been going up too. So it seems to me that wages are just kind of following along with the general the drift of things. Uh, inflations running in the higher companies are

trying to avoid locking in a higher cost structure. So what they do is a lot of them are offering one time cash aims to compensate you for inflation, sort of hoping that everything settles down. That's kind of what the cost of living adjustments used to do in the old days. This is a little better because this gives you the flexibility if things settle down, that you don't don't get locked into a higher, higher pay structure. So I don't think the wages are causing the problem here.

Wages are just really mirroring when going on in the broader economy. You know, I don't want you to front run Kasman and Faroly here. But with your anecdote on the ground work, Jim Glassman, are we fully employed because there there are no employers I know who aren't desperate every am I right, Paulture, I mean just just desperate for a three point shooter? And you know I mean, Jim Glassman, are we fully employed? Based on the Glassman

or what Northwestern theory? You know? Um, for the very moment, looking at the people who want a job, you could argue we're fully employed because basically unemployment is back at where we were before. The problem is we had about we have about four million people who gave up and dropped out. We think they want to come back. They dropped out because we gave them the financial support to be able to do that, so that that support to disappearing. And I suspect that if we were fully employed, we

would find there's nobody else out there to hire. But I think over the course of the year we'll find in my book there are four million people who are still out relative to where we were in the pandemic. You can't look at where we are relative to February. The economy is always growing you've got to look at where would things be as we're growing year by year. So I think we still I don't really think it's fair to say we're fully employed. Our problem is we

have a structural demographic thing. You know what's so interesting Our work force, the population of people who are working age has been slowing down really dramatically. You know who it is. It's the vicenarians are twenty years the bisnarians are twenty year olds. They are growing. That population was growing fifty per month a decade ago. It's now declining fifty a month. Finally, just contributed three new adult workers

to the workforce. Drinking that Jim Glass. And by the way, why everyone's complaining to help one signs everywhere it's the starting jobs that are really people are struggling with. They're having a hard time getting new people. Well, if you don't have a flow of twenty year olds coming into the job market, this is why this is what they're talking about. Okay, what was that term you used? Bisnarians, the twenty year olds that the guys who were twenty This is like gen z gen yen that and now

I guess that's a Democrats. This happens when l A. You know, it's like an all the other language out there. He was charming when he was in Chicago. Jim Glass, thank you so much, greatly appreciate with JP Morgan just truly a one for way to get our job covered. Started his pulse on small business is just sick what he does for JPN market every day. This is the

Bloomberg Surveillance Podcast. Thanks for listening. Join us live weekdays from seven to ten AMI 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 and this is Bloomberg