Surveillance: Roubini Warns of Slow Recovery

Professor Rebini, wonderful to have you back with us. You wrote in February or January of the white Swans that are out there stealing that phrase from nothing Talub as well, where are the white Swans of two years from now? Well, there are some medium term challenges that were facing right in the world in which public and private debts are rising. They're going to become even bigger given the response to the crises. We have the risk of global pandemics becoming

our current global climate change. This Cold war between US and China is getting worse, geopolitical risk arising. Serious political uncertainty is about the US election, about the shape of

the recovery started like a free fall. Then for a while people thought it would be a v This v is becoming a you that you could become a w if you don't find the vaccine, if you don't have enough Lolaurial, I want to look forward given the assumptions and certitudes that institutions have right now, the great model Neil that we have is there's a bridge out there and we should invest or act according to that bridge. Do you believe in the bridge and can it get

us to two thousand twenty two. I worried because before the crisis there was a massive leveraging of the corporate sector in the United States, but also in many other parts of the role, including emerging markets. And given the COVID shock, most firms have to deleverage. The leverage means to spend less, save more, and doing less capax because there is a glass of capacity. Now, how you spend less. Your main cost are labor costs, But your labor costs

are my labor income. So the de leveraging of the corporate sector implies there will be much more sluggage labor income. First, the workers are fired, and even when they're gonna start to be hired, they're not gonna get full time jobs with full wages and benefits. Will be more gig workers, part time workers, our workers, contractors, free lancers. That means a huge amount of uncertainty and risk. Aversion by the

household sector that is also highly indebted. So you're gonna have also deleveraging by the household sector that they have to spend less, save more, and do less residential investment, and that the leveraging of the private sector implies at best sluggish. You shape our covery and a tours from not doing the writings them as of controlling the virus, and we don't find the vaccine that you could become even a double a double D procession. But no real

If you look at the markets, they're going up. So you know you've you've basically you're saying that we're going through ten years of misery. The market keeps on going up because of central banks. So you know who's right. Does the economy catch up with the market or the does the market catch up with the economy. Well, as you pointed out, you know we have zero policy rates, if not negative. We have a long term interest rates in the US at best at sixty basis points in

parts of the world zero if not negative. Central banks are even buying high yield and I great bonds, so those spreads are squeezed and you don't get much in credit or fixed income, and therefore people are going into stocks, but not because there's a very strong recovery of earnings. I mean, you have yet five companies, the big tech, within the five hundred of SMP that are doing well.

The rest of them are not doing well. So it's all driven by further multiple expansion rather than a real recovery. And what's good, by the way, for Wall Street is bad for main Street because Wall Street represents what big firms, big tech, and big banks. What's main street? Workers, households

and small and medium sized enterprises. We know that hundreds of thousands soon enough of small shops, retailers and others are going to go out of business while the market share of big business and arise, and that's driving things straight down. That creates tons of jobs in the SIME and makes the big firms even bigger in terms of

market shares. And as I said, if the firms are going to survive and drive and achieve earnings target by slashing labor costs, your labor costs and my labor income, my consumption, and eventually that slamp of consumption is going to weaken earnings and profits down the line. So I think that the market doesn't reflect the real economy. Mainstream is struggling, straggling severely. We're also focusing a lot more on health. We're also focusing a lot more on climate change.

Governments are doing that across the world. Doesn't mean that the pandemic is actually ending our obsession with economic growth

to focus on other things. Well it might then the short run, But now there is some clear evidence that these zoonotic diseases that our transmission from animal to human that are occurring much more frequently, where HIV stars, Mayor's swine flu, bird flu ze CA now COVID nineteen soon en after it might be even more virulent, is driven by the destruction of ecosystem That implied that animals that are wild that heavy these diseases are closed livestock and

closer to human So if we don't address the destruction of the ecosystem, the global pandemics are going to become more frequent and more severe. And this pandemic alone has done more economic destruction than any economic and financial crisis in the last seventy years. So thinking that we should not worry about the environment. Doesn't make any sense. We have the investing environment control because that's gonna be greating jobs. Nor Robinia, I want you to take an old world

study of how America's struggling to do income replacement. It's understood in Germany, it's understood in the continent, it's understood in the United Kingdom. And America struggling so hard with aid, with stimulus and with the ideas simply of replacing income. Why is that. Well, Historically people were criticizing the European labor markets for being a more rigid and not as

flexible as the US. But during the crisis, the European systems is to have worked much better because instead of indiscriminately firing people, there is a system where workers stay on the job, they get at least sixty to seventy of their income depending on the country, and the rest of it is risk sharing between the firm and the government.

That's why the unemployment rate barely went up in Germany or even in Italy, while in the US we've had double digit unemployment rate and actually even worse considering underemployment and so on. So I think that actually system where there is more social collision implies that you don't have the collapse of employment, the collapse of labor income. And that's why the recovery of Europe and the Eurozone right now maybe better than the one of the United States.

Of course, there's a dual labor market. There are people that are informal workers who don't get the same kind of benefits. And there's a risk that, of course if there are cover is going to be anemic in Europe with another wave, that there will be another wave of unemployment.

That's a serious risk. But that's more rigid labor market, and this form of re sharing has implied actually they're doing a major price like this, the European system of greater social coession gives you better economic outcomes than the one of the United States that is just wild West capitalism. Does that mean that m M T will be here?

And again, what does that mean for you know, for assets? Well, we are already effectively in m M T or helicopter drop of money because we have massive budget deficity of the order of ten percent in Europe. In the US is going to be closer tow and we have central banks that are effectively doing unlimited qui formally in the case of the US or Japan, informally even in the Eurozone and other parts of Europe. So what's the difference between m m T and large monetized budget deficits? Only

two fig lives? In one case you buy the bonds in the primary market if you do m empty. In the other case, if you do qui, you buy in the secondary a week later. To m emty is supposed to be permanent, while que is supposed to be temporary. But this temporary que is becoming permanent. Effectively, we are in that world of and we are out of time. Nor Robini, thank you so much. You look forward to seeing you again. It's the real deal has become very serious and that's a good way to bring in our

first guests. This is perfect for the morning on these John Gallup joins from Credit Such. John, I want to go right over to James Sweeney and the rest of your fixed income team and economics team. What is the real yield? Excuse me, what is the large negative real yield mean for equity investors? Um, you know, it's it's interesting, Tom. We've We've done a whole bunch of work on what it means for stock prices, because I know that people who are looking at gold and other assets are obsessed

with this. The market cares more about nominal interest rates than real yield. They do care about this. This issue of inflation and we are when we're talking to clients, whether we have inflation or deflation on the back of this crisis is a really big discussion point because it sets the tone for what type of stocks are going

to win. But the but in terms of the direction of the market, it's the general of it's the sixty three basis points on the tenure matters more to stocks than this negative one person you're talking about right there is worth the watching of Bloomberg surveillance. Through all of this surveillance thign right there, it's the nominal yield minus inflation expectations and the residual of that is the real yield. And what you're hearing from Gala do is look at

the nominal yield is the most important determinant. What does it mean, John Galup for the big banks and for banking in general, Well, you know banks don't do well when there's no interest rates. And at sixty three basis points on the ten year and you can pull up on your Bloomberg on what a two year UM bond yield is doing, which is a lot lower than that, and banks can't be that profitable in that um wormans.

Why the US banks have done so poor and actually worse than European banks is because the yields in the United States have fallen meaningfully, but European yields were so low going into this crisis they couldn't go any lower. UM. So the damage to US banks has been much greater on a relative basis than the banks than the damage to European banks um. You know, as a result of this crisis, which is really I think a surprise too many.

John gub something current this morning. An hour ago we saw John Deere come out with a better view for their Q three. Certainly a surprise to the market is that a trend that we're going to see coming here and that with the grimness and the gloom of a pandemic markdown, actually companies could do better. You know. We we saw in the second quarter that it was the best quarter in history in terms of beats, how results are coming in relative to expectations, and it was also

the single quarter where the market cared less than any other. Um. The people are trying to figure out is where is this thing going? And what happens to Q three earnings In the middle of this, it's probably more noise. People are really trying to figure out the kind of a trend direction. Do we have a cure, What does it do for rates? What does it do for inflation? As

you were talking about, which is really the key issue. Um. But but the next quarter in terms of earnings, the market really is actually shrugging its shoulders much more than you would think. Okay, so Jonathan, let's go back to in good morning from London and frenzy. But let's go back to this inflation versus deflation. If we want to see inflation, let's say, rampant inflation, where does it come from? Is it central bank action? Is it stimulus? Or actually

is it's simply supply chains. If you move supply chains and you move them back home, you know, partly because of trade wars, but also because of COVID, doesn't just mean that prices go automatically up. Well, it's a really great question because recently we've had to pick up in actual inflation and you're starting to see if you wanted to go buy a bicycle or tennis racket or certain things like that, that there may be shortages because everything

has been shut down and then reopened. And you're seeing inflation right now for people who want to leave New York City and buy an apartment and apartment but a rent a home in the suburbs, that the prices are up because there's no additional stock of homes to buy or rent. And so you are seeing inflation now, but it is not the kind that's going to freak the market out, because this is really transitory. It's because of

um kind of the result of the crisis itself. The real the real question, I think in terms of longer term inflation, and that's really what what matters here is are you going to see this as a systemic issue because the Fed is printing money and that it's ultimately going to be a monetary phenomenon that prices go up broadly on a sustained basis. If that happens, then it's going to affect asset prices if it's something that's a near term shortage. For example, the price of lumber is up,

but that's not something that's a long term trend. That's a that's really resulting from the current crisis. That's not the thing that's that's going to make the market uncomfortable. UM. But the real question if you have central banks everywhere in the world printing money like crazy, then prices naturally go up. And that's the thing that people are focused on. But with a labor market that is, you know, with fifteen million unemployed Americans, it's very hard to see right

now anything that looks like underlying inflation. Johnathan, you know, there are two things that I learned in lockdown, and that was actually, yes, bicycles rise and inflation. And there's also a puppy shortage. I don't know whether you can model that. I mean, Tom can actually you know, see a three standard deviation in prices of puppies. How do you protect yourself to do you buy inflation protection at

this moment in time? I don't. I don't think So you're you're talking about what matters if you in the inflation deflation argument. And I talked to Andrew Garth, wages are global strategies about this all the time. If you are if you think that you're going to have a long term inflation problem because of all this any printing, then value beats growth and non US assets to actually beat US assets if you think that we're going to have disinflation. And that's my view that ultimately all of

the damage that's being done here actually pushes inflation down. UM. But if that's the case, then growth winds and tech winds and large caps. So this this discussion is not just an academic um issue. It is the single most important issue for pension plans and hedge funds and fund managers who want to figure out how do you play this thing? Not over the meat but over the next you know, one to three years. John Glup one final question.

I was thunderstruck and caustious. James Sweeney. The last time, you're wonderful chief Economist was on with us. I've never heard Sweeney so conscious, and that's confirmed today by the statistics out of France as well. Are you investing based on sweeney caution? First of all, we talk all the you know, we talk all the time, and um, you know,

and we don't. People don't always agree on everything. Right now, we're seeing the world the same way that the bounce that we've had this v shape, bounce off the bottom is going to start flattening out as we go into the September October time frame, and so we believe you're

gonna see more data start to roll over. And we saw that, for example with the jobs data UM yesterday on the unemployment claims, it has really stopped going down and it's the the improvement in the job situation has kind of flattened out, and we think we're gonna see that. And James is a big proponent of the idea of industrial production that the industrial data, which bounds really hard, big v off the bottom, that it's going to stop improving on a relative change basis, and so he would

he would agree. He would actually, uh, I haven't spoken to him. He'd probably look at the date out of France and say directionally, that's not a big surprise. John gob thank you for the briefing with Credit Sweet. Is just wonderful to see that combined research of Mr grayth Right,

Mr Sweeney and Mr Agalab. We go to Lisian Saunders of Charles Schwab her her experience at SQUAB is extraordinary and Lisien, I want to go back to the moments like with Lou rue Kaiser A few years ago where there were big events were now into not a big event but almost a weekly and indeed monthly numbness of struggling news. How do you invest given a numbness? Yeah,

it is an extraordinary period of time. And I really think and I would say this, I suppose in a normal market environment, but investors have to remember that some of the basics around UH rebalancing, broad diversification, I think really come into play in this environment. I continually get questions about whether to be in this market being given high valuations or election uncertainty. Should I get out now? And neither get in or get out? And I think that's sort of the moxie of some of the newly

minted day traders. Is a long term investing strategy, and I think in this environment, more frequent rebalancing driven by volatility and what asset classes are doing. Letting your portfolio tell you when it's time to do something keeps us in gear by sort of forcing us to trim and to strength and add into weakness, which is ultimately the

best path to long term success. Some of your research, Lisanna, is about volume, about retail trades, about the confidences that are out there measure for us, a pile of money on the sidelines. How big is the mountain of cash? Well, it really depends on what type of investor you're looking at, and that's really extraordinary. If you look at the most active investors, their equity exposure has gone well up, so

there's not a lot of cash there. If you look at a more traditional investors and there was a recent gallop pole, you can look at overall household exposure to equities that's been coming down. So that's another unique part of this market environment is you really have significant divergence in terms of both behavioral and attitudinal measures of investor sentiment and what they're positioning is So if you look at the cohort of newer, younger, more active day traders,

their exposure is extraordinarily high. But if you look at more seasoned investors, both on the retail side and the institutional side, they've had a bit more skepticism about this and are holding larger amounts of cash. So it really is a unique environment where you have to break investors into various cohorts, in some cases a functive h to get a sense of where there's excess and where there's

still opportunity. But listen, where do you know volatility? More volatility give, because just simply the number of infections are rising because of COVID nineteen and it will be much more difficult to read the economy. I think economic volatility is absolutely a given. We've seen diminishing equity volatility as measured by things like the VIX, but I think as we move into the fall, that's likely to pick up,

even absent any news on the virus front. I think election related volatility tends to pick up in the post labor day environment, so I would certainly expect that to be the case this time. But I think economic volatility absolutely not just driven by number of cases. And there's been a big focus on vaccines, and I think the market would obviously be pleasantly surprised if we do get

near term news on a vaccine. But I think just as important would be news on therapeutics, because we have to remember that upon an announcement of a vaccine that's ready for humans, that'll be all the follow on questions on efficacy, availability, that percentage of people willing to take it.

So I don't think the head and we're looking for on a vaccine answers all the questions that we have now or will then las Angel We spend a lot more time trying to figure out, you know, what companies will go into liquidation, will go bankrupt and and is this because of COVID nineteen or is it just an acceleration of trend. Well, we're seeing heightened level of bankruptcy akin to what we saw back in two thousand and nine, but we also have FET facilities that have been able

to sort of stem that tied a little bit. I still think it's a factor, particularly when we look at the relationship between temporary unemployed and permanent job losses, and those have been going effectively in the wrong direction. We've seen a decline in temporary layoffs and a rise in in permanent job losses, and I think that will continue to be tied to bankruptcies filings now. For now, defaults have been held at bay in large part due to

what the FETE has done. But I also think that there might be less willingness on the part of some small companies that are facing an existential threat to their business to try to stay afloat via what the FET has done or other means. So that may be what's different in this environment versus last time. If you really question your long term survivability, I think there are some companies that are just throw in the towel right now.

Bloomberg Radio, Bloomberg Television, a simulcast for instance, ly Qua and for Lisa Bryan wantson John Farrell. We welcome all of you on this Friday, Lizzie, and I didn't know this was going to be a theme of the week on a Monday, but here it is, and that is diversification or Peter Lynch's diversification, whatever it may be. Are we over diversified in our retirement plans? Actually we we

think not. In fact, if we look at the lack of rebalancing that's done, particularly US versus rest of world, there is a significant bias within portfolios towards US equity ex closure, largely because the lack of rebalancing in the performance. And I think you know what tends to happen as you move from one cycle into another cycle, you do see tend to see a reversal in leadership. And we do think there is an opportunity for non US to provide some diversification, which hasn't been the case in the

last years, but interrupted. But this is really important. Are you talking about European multinational Swiss, nest Lee's, etcetera. Siemens. Are you talking about individual names or individual because I understand what are you talking big cap? Are you talking to em talking just developed international markets, emerging markets within portfolios at the broad asset class level. Uh, not specific to any country. I do still think large caps, both in the United States and globally um will be in

the leadership position. I think the fundamental differential from a percentage of zombie companies, debt to equity ratios, all the quality factors that have been dominant in performance across asset classes US and globally, across sectors. I think that quality bias in fact will define leadership more than things like

sectors or even countries. Listen and the time that we got left to you with your public service in the Bush administration on fiscal policy as well, How troubled should our listeners and viewers be over the size of these deficits, the rapidity of which we've seen these trillion dollar deficits. I think we should be troubled long term, we're all m m tears. Now, I think if there's one area for bipartisan support, it's for kicking the deficit and debt can down the road. And there doesn't seem to be

much concerned about this now. I don't view this as an as a debt bubble bursting accident at a moment in time. I view this as a simmering crisis over time because what's been shown, not just here in the United States but anywhere around the globe, a high and rising burden of that even if it doesn't cause a moment in time crisis, it's an impediment to an economy

being able to grow at a robust pace. You know, we all celebrated the longest economic expansion in history, the most recent one, but it was also by far the weakest, and I think one of the reasons for that is the high debt burden and interest costs are swamping everything else the government spends money on. And even in a no rise interest rate environment, just increasing the debt at the pace we are means that interest payments, even in a flat yield environment, start to really swamp spending on

anything else. So I think it is absolutely a long term problem, and I think the effect of it is a slower pace of growth than would otherwise be possible. Lizen Saunders, thank you so much, very valuable conversation this morning with Charles Schwab. Of course, what is that, Jeneminster? And all I can say is, years ago you would attempt to steal Piper Jeffrey research because there was this

crazy guy at Piper Jeffrey. Within all the trials and tribulations of Apple two thousand seven to two thousand eight, from twenty eight down to twelve is per share, Munster up. Paul started picking up Apple, it ballooned. It went from a dollar fifty three a share to four dollars sixty cents in two thousand four, and that has done better than that recently, think thirty nine percent per year up to the lofty two trillion level we're at now. We're honored to have Jeane Munster with us. Jane, how do

you buy in a hold something like that? Tom? I think it's about knowing where the world is going, And ultimately this exceeded our wildest dreams when we just step back and think about it over the context that we've covered it, but in a two to five year window, it has not exceeded. It actually has been more predictable than we've seem at first glance. And ultimately we have to ask herself the questions where is the world going?

And in each of Apple's chapters, they have been in front, never first, but always in front with the best products around where these themes are. And I think that that ultimately is the question to ask about Apples. Are they going to be positioned for what people want next? They

were positioned on Madison Avenue yesterday, folks. Good morning to three guys and all the great people up there helping me with breakfast after this swire at Bloomberg, and I wandered down Jean the empty stores the empty I mean empty, I mean stores in business that are empty, stores that are closed and empty. And there's a line out the Apple door I mean, and trust me, folks, it's the only store with a line out the door, Jean monster, How do they get to three trillion dollars? How does

Tim Cook continue this success? It's about capping into those next massive themes. You know where we're going. This pandemic has created a fracture. It is kind of the next wave here. But to answer your question, there's three phases to it. The first and five G. Five G is going to be more significant than when people realize it's gonna be a multi year upgrade cycle for iPhones. Typically we see a one year upgrade cycle, but this is

gonna probably be a three year upgrade cycle. So that means you're gonna have kind of high single digit, low team growth of iPhone that's much higher than it's been flattish over the last couple of years over the next few years because of five G. That's one way that it gets to that that three trailing mark. A second is what they're doing around health and wellness. It's still

largely about the watch. It's underpenetrated. Less than ten of iPhone owners own a watch, and so there's a growth opportunity. But also to extend that they have patents around making air pods more of a health and wellness product. Your ear drum. The tends to be a great place for picking up bilebacker markers like for example, blood pressure. That's

an example of how Apple can extreme existing products. And then the last pieces around services, and I want to emphasize this is they have an opportunity and our prediction and belief is that they will create a bundle, a three sixty bundle of hardware software. You simply pay Apple once one month dollar or one monthly fee, and you get your hardware upgraded at a certain basis, you get software services. It's just a one stop shot. When are we going to When are we going to see it?

Sounds like Apple Prime. When are we going to see it a Apple Prime? Well said, I suspect it was in the next three years. This October, we're going to see their first bundling of their content. So you're gonna see them bundling Apple Music with Apple TV, plessing for their storage, their eye cloud storage, so they it's referred to as the code name is Apple one. But that is I think uh gonna be a leading indicator of ultimately what only Apple can do, which is bring these

hardware and services together. Northern Company can combine this. That's what consumers want. They just want to take the headache of tech away from themselves and have a steady bill to pay on a monthly basis. And I think that in the next three years we're going to see that, and I think that's gonna be have a material impact in terms of how investors view Apple's revenue and earnings predictability. Ultimately, I think that's going to garner a higher multiple. So

it's interesting, Gene. Right here, I'm wondering how all these high priced hardware and software services that Apple is so famous for will fare in a world where in the US we have ten percent unemployment, we have a global recession. At what point does their business feel the pain? The point that they I mean, if this is sustained for multiple years, Uh, they will feel the pain just like

everyone else. And the reason why they haven't felt the pain is obviously because even with the pain of everything you just described, we still need these devices. And essentially the responsibility of tech has been shifted from business and organizations on the consumers. And so even though they have less dollars to spend, their spending it with their tech. You know, Paul, I gotta interrupt here and just say, rounded up Apples already up to two point one trillion.

Monsters blathering on exactly. So, Jean, how about the cash here? I mean, you know, the cash just keeps, you know, piling up here. They have sixty billion dollars in free cash flow every year. Is there ever going to be a I know, they buy back a lot of stock,

but what do they do with the cash? Probably most of it's going to come back in the form of buying back just like you said that the one X factor in terms of getting to what they call net cash neutral, which the bottom line takeaway there is there's still this wave of cash coming towards investors with its through buybacks. There may be some acquisition. Apple has never done a big acquisition, but I think that they always hold the right. The question is who should they acquire ultimately,

and uh, that becomes more confusing. They in hindsight they probably should have acquired Tesla when it was fifty billion, but that's in a different place today. But that's the other uh, where they could be using the money. All right, let's let's let's go there. Let's just talk Tesla here, I mean again another stock on a just a parabolic rise. Here,

give us your latest thoughts here on Tesla. The question is less about the chart and where it's come from in the past year and elon Musk and his behavior for us, It's more also about where is the world going and ultimately where can they what can their position be? And the world is going to electrification. It just simply is a better way to move people around and also autonomy. And when you think about that first part, the electric part,

Tesla has a lead. They have any percent market share in the US and E vs about twenty five in Europe and about ten in Asia. But the important part here is that that lead is a sustainable lead. I think that that is one of the I think areas that we're in a different place. We view this small a place that traditional carmakers are going to catch twenty two.

I think it will be difficult for them to ultimately catch up for a number of reasons with we're Tesla's at But if you kind of play this sport and assume their market share does go down, but ultimately in the US. But let's assume that they get market share of electric cars globally in the next fifteen years. That's twenty one million cars a year. They're doing about five

hundred thousand right now. That would be about seven hundred and fifty billion in revenue, which implied that the current evaluation of Tesla is still training at about point three times revenue. Now Apple's training at six and a half times revenue, and uh, I think that that is undervalued Apple at six very different companies Apple and Tesla. But the point is is that it's still room. But they want me to test drive the Bentley ben taken this weekend,

and I mean there's hybrid cars. I mean, Gene, I understand Tesla's out there, but am I right that they have the market to themselves? And what's it gonna be like in twelve four thirty six months? The challenge for traditional auto to catch up, and this is something that we UH closely study the challenges. It's not about just introducing a car and saying, uh, here, we have a great brand, We've been around for a long time, we

have a good style. There's some substance around the features that consumers want, but one of the biggest ones is range and price. Those that intersection between range and price, and ultimately is that Tesla is about thirty less expensive than traditional auto and for traditional auto to close that most critical feature gap, and you need to tell the cars at a discount, which is a problem for a lot of their models because they tend to be leveraged

businesses and so UHS. There effectively is some economies of scale that Tesla has captured on top of that, this battery advantage that they have. We're gonna hear more about it in September at their battery day, but that will likely continue to lengthened. And so the best the lifeline for the auto industry. And I'm not saying that Ford and GM and Toyota are gonna be gone, but I do believe one of those three are going to be a fraction of their size in the next fifteen years.

But the one lifeline is will Tesla end up licensing some of its battery and motor technology to Otto. Elon Musk has recently hinted he would be open to that. I think it's a bluff. I don't think he has any desire to do that. Do they make money on a car Tesla? Uh? Yes, they do. Uh. And the reason why I even hesitate there, there's uh there's a lot of noise around production or filling plants. But they do make money and ultimately they can have a business

the margin their goals to have a margin. Gene, thank you so much. Tell me when you find an entry point on Apple. Gene Munster Loop Ventures in congratulations to Gene Munch's Munster for sixteen years. Way out Front on Apple. Thanks for listening to the Bloomberg Surveillance podcast. Subscribe and listen to interviews on Apple Podcasts, SoundCloud, or whichever podcast platform you prefer. I'm on Twitter at Tom Keene before the podcast. You can always catch us worldwide. I'm Bloomberg Radio