Transcripts For BLOOMBERG Bloomberg Markets Americas 20240712

Have a durable exit from the health crisis. Including Amnesty International had written to the g20 finance ministers ahead of that meeting to warn that the world is facing a crisis unlike any in the last century, and that debt suspension is only a first step. The group said many of the poorest nations are spending more on debt payments than on lifesaving public services. There is growing pressure on british Prime Minister Boris Johnson to order a socalled lockdown. The Opposition Labor Party and government Scientists Say it is needed to get the coronavirus under control. Deaths have soared to the highest level since june. Concerns are mounting that johnsons new system of restrictions will not be enough. Pressure continues to see a Record Number of coronavirus cases. Officials work reported 14,000 new cases today, the most since the beginning of the pandemic. Russia has the Worlds Largest caseload. Despite a surge in new cases, russian authorities have dismissed suggestions of a Second National lockdown. Global news, 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. Im Mark Crumpton. This is bloomberg. Vonnie welcome to bloomberg markets. Vonnie im vonnie quinn. We are joined by both are bloomberg and bnn bloomberg audiences. Air the top stories we are following from around the world. Big u. S. Bank earnings role in. Goldman sachs, bank of america reporting today. We will discuss the results and what they say about wall street and the health of the consumer. The rates for a virus cure hits reality. Johnson johnson vaccine study was paused after a volunteer got sick. Eli lillys antibody study holds an enrollment over a safety concern. The fda is saying that it is all part of the process. We will discuss with dr. Jeremy faust of bregman and womens hospital. We will discuss why one electric truck start off is pulling off on many despite the need for millions of daughters to start dollars to start producing vehicles. Stocks are weak today. We are seeing tach accelerating to the downside as we go along. Concern about the stimulus package are heightened after secretary mnuchin said hopes for a deal before november 3 might be overly optimistic. You can see s p 500 down. 8 . There is the nasdaq down more than 1 . Energy and industrials are doing well on the broad u. S. Market, despite the warning from the iea that we may be heading toward Peak Oil Demand in the next decade or so. We are seeing no help from tack across the broad market as is evidenced by the nasdaq. In toronto, energy doing well. Tech is suffering. Keeping eyes on financials today, the earnings they are offering up not enough to offset some concerns about the shape of economic recovery. It is a decidedly mixed picture, as we saw from the stocks and how they are responding. Goldman and jp morgan beating expectations but wells fargo and they commit bank of america sliding on concerns of what they are showing in their quarters. Sonali basak joins us with more. Obviously, there were great hopes that these Financial Services would be able to look beyond the covid19 pandemic. But it does appear the outlook is the problem. Sonali it does appear that problem. S a there is worries about the Net Interest Income and how the banks are supposed to build a Business Model around Interest Rates that are low. Charge offs are expected through the year. There is a little bit of a bright spot you can find here and there. For example, payment deferrals have gone down. Except i could get worse once again if the government does not come up with a bigger stimulus package. There is a lot weighing on the economy for the banks. This uncertainty is really spooking investors. Vonnie wells fargo, does it ever end . Sonali it was a tough day for wells fargo. They posted a loss the last quarter. The first loss since 2008. A very tough previous quarter. Loan losses came in less than expected. This is a surprise jump, 1 billion charged for customer mediation. A costlyng to be turnaround story for wells fargo as they work through their work with regulators. As Charlie Scharf puts his new team on board. Even with letting some people go, that comes at a cost. They are going to be feeling the pain for some time. A bit of athere reaction in the sense that one of the things we expected to see, and we have seen evidence of, is conservative Loan Loss Provisions that might be more than is required . There is parsing out where we go from here. But it does appear as though so far the banks have been conservative for the most part. Sonali rate, one of my sources made the point to me that all of the banks are using very similar metrics when they are parsing through and analyzing these losses and what they should look like. We thought a quarter ago that we might have been done with the losses then. They think they can see more provisioning into next year. The reality is we dont really know how bad it can get. So the over correcting, when you take that on top of the Net Interest Income, wells fargo believing it will remain soft into next year, you can blame it on the fed but at the same time, there needs to be another story for investors to hold onto. Vonnie what can we say overall about the quarter for banks . I know we are not through but we have the main ones in at this point and they are going off in different directions. What binds them . Sonali the investing baking business we did not talk about. They have leaned on those businesses hard. And you look at Goldman Sachs for example, resounding optimism when it comes to and maybe that is a little strong, but optimism when it comes to ceos being more confident. A lot of m a potentially coming back. So you see activity among corporate america. You are just not seeing it in the consumer. We definitely have seen in the u. S. And canada consumers who have been given government aid using it in some part to pay down their debt, increase their savings, basically shore up their own balance sheets. Are the banks being overly optimistic about how long that will last if we dont get more stimulus and if things should get worse as we go forward . Sonali banks are recognizing this is happening. Consumers are being safe. But you dont know how long that will last. Especially without another stimulus package happening. That is tough for them also, remember, Interest Rates are low. Putting money in a savings account is tough when the equity markets are where they are. Separate story is when blackrock announced earnings, the Retail Investor was a big part of their story. So it is unclear whether that savings boom will continue. And a lot of people are banking online and you are seeing places like markets really benefiting from that movement. Vonnie thank you so much that is bloombergs sonali basak. Some breaking. France will reimpose a state of Health Emergency from saturday at midnight. Newspapers are reporting it. The president do to address the nation in five minutes time in france. The state of state of Health Emergency that had been lifted the 10th of july due to take effect again across the country from saturday at midnight. Certain areas may see further restrictions. Coming up, do they find medical breakthroughs . We will talk to dr. Jeremy faust about the challenges of developing a vaccine. This is bloomberg. Bloomberg. Is bloomberg markets. Im vonnie quinn hummel alongside amanda lange in toronto. It is not typical for the general public to receive so much information on the development of a new vaccine according to lauren sauer. She spoke with Francine Lacqua about the difficulty of consume of communicating the process and the risk to a shot. Have a listen. It is a good thing we are seeing this process play out the way we want to wanted to. I dont think we want to get to the end of this process and have a series of therapeutics and vaccines that have seen no adverse events, because it means our threshold for of what those adverse events are is not strong enough. What we are seeing is the process in place playing out the way it should to ensure that when we get to the end, we know we have a safe and effective product that we can distribute to americans. Francine what is the communication needed around that . You were talking to me in the break saying, we have never really followed these trials so closely. Who is the best person to communicate this to the general public . Lauren i think that is where a lot of the work has to happen. We are not the public is not used to hearing all of the ins and outs of this process and every single adverse event being reported as National News and making prime time National News. Ensuring we are working with the Community Members who are going to be taking the vaccine, taking the vaccine or products and working with communication groups who understand how you talk about risk, how you talk about the process, working with people who have spent their whole careers on the best messaging and the best Communication Strategies is a critical. Francine is the virus less deadly than it was 3, 4 months ago . Lauren i dont think im the right person to speak to that. I think there is plenty of virologists who have been doing piece. F work on that what i will say is i think we are Getting Better at taking care of people who have been infected with the virus. Perhaps outcomes are looking better. I dont think we have seen a lot of mutation in this virus to warrant saying that it is different or less deadly. But we as a system, especially a health care system, have gotten better that entering that when people get infected, they get the best care. We have new strategies for their care, new therapeutics coming online, and getting them out of the hospital and safely home. That was lauren sauer, the John Hopkins University assistant professor of emergency medicine and the associated Johns Hopkins Bloomberg Public School school of Public Health is supported by michael r. Bloomberg who is the founder of the Parent Company of the bloomberg network. As lauren sauer alluded to, echo did by fda commissioner stephen hahn, the halt in eli lillys antibody trial as well as other vaccine trials is all about process and safety. It is not about politics. In an interview on bloomberg, this is what the commissioner had to say. This is from the fdas perspective, not a politicized process. Of course we are concerned the public feels this may be politicized, but i want to reassure the public that it is not. We are here to talk about the developing vaccines is dr. Jeremy faust, emergency medicine physician at goodman and womens hospital. He was part of a group of scientists who did report the news about eli lillys vaccine treatment paused. Think you very much for being with us. Lets start right there. Whether there is a general understanding about the complexity and the sensitivity trials,nt illness and in the general public, and whether that muddies the waters for people trying to figure out how soon we will have a vaccine . Dr. Faust like the previous segment alluded to, no one has really seen this before and play out in real time. We are in uncharted areas here. Relieved to quite see this level of transparency. It is actually why Clinical Trials are so terrifically important. When you look at something that the fda did like making convalescent plasma available through emergency use authorization, that did not come after a trial. On retrospective studies looking at patients whose outcomes are already known. So you dont have the opportunity to stop or pause when things go wrong, when patients die after receiving a treatment or even have any event. Whereas in a trial, you can monitor, you can pause, you can halt, and you can do all kinds of things to keep track of what is happening in the moment. So that by the time the results are available, we know so much about the safety, we know whether the placebo has problems, we know whether the intervention the people getting the possible drug or vaccine or antibody has problems. Knowing that gives us the confidence to tell our patients, this is vetted. This has been looked at. Here is the expectations. Here is what we think the benefit is going to be. Vonnie dr. Faust, when do you think it is possible to have all of that process done, and for there to be a credible timeline for a vaccine . If you like we are waiting for one sooner rather than what could be credible. Dr. Faust i think there has been tremendous progress here to make sure that when it comes out, it safe. There was a point about a month or two ago when it seemed like politics might intervene. In the administration might put pressure to put something through that was not ready, that have not had a lot of followup time to see how long the patients who are enrolled last without getting infected, or if they do get infected, and safety concerns as well. I was someone who coauthored a letter to pfizer, and then eventually to the federal government, saying we need this to be done correctly so that when we get information, we know it is actually safe. What i think is knowing that we want to months of followup after pace that patients receive the placebo where the vaccine or antibody, that is reasonable because we want to know how well these things work and what the side effects may be. I tend to think comparing to a deadly disease, the side effects are unlikely to be terrible. But have to know that. We cant be gambling with the lives of millions and millions of people. We need to say to each age group, heres the risk of dying if you get the virus and heres the risk of having a fever or Something Else if you have the vaccine. Having that discussion is the linchpin of what weve call informed consent. What point in that conversation should the reality of this type of vaccine be delivered . Which is to distinguish it from a vaccine against other illnesses which is 100 effective and can eradicate that illness. As i understand it, correct me if im wrong, these vaccines are not 100 effective. They may be worthwhile, but one of the arguments against the flu shot is it does not always work. When do we start communicating that . Dr. Faust first of all, we want to distinguish, the eli lilly pause is an antibody that trial. But i take your point in general which is how effective are these vaccines . It depends on the vaccine, it depends on the pathogen, the virus. One of the reasons why it is so hard to get good signal on flu, influenza, the fatality rate from influenza is exceedingly low for most people. So you have to have so many people getting it in order to see a mortality benefit. And the flu is a pathogen that changes every year. It has a very fast mutation rate with how fast it is designed. Whereas we are thrilled to report not in the same rapid way as say a flu mind such a dramatic way, hiv is similar and has a high mutation rate, which makes it hard to hone your vaccine. Our hope is that what we have at first will be a first step and we will hone and hone and get closer and closer to an effectiveness for the conversation is relatively straightforward. Vonnie thank you for all of your intelligence today. Much appreciated. Dr. Jeremy faust of brigham and womens hospital. Coming up, the pressure to go public. We take a look at one electric truck start up that is not so sure it wants to hit Public Market just yet. Thats next. This is bloomberg. Thats next. This is bloomberg. Amanda this is bloomberg markets. Im amanda laying alongside vonnie quinn in new york. An electric truck maker faces something of a dilemma. It is hoping to raise money to put its trucks into production. And the specs are calling. It faces the question of whether it wants the scrutiny of the Public Market in order to get the capital. Us now. Lsch is with great story about this. It speaks to a couple of things. Lets start with these facts, acquisition corporations hunting for investments and how that is shaping decisionmaking out there. Companies,have these their sole purpose is to find deals. And they have had a bit of a gold rush in the past nine to 12 months for electric vehicle deals. Most of the companies they are buying have little or no revenue, but they are going ahead anyway. Bullinger is one of them. They have a cool looking hummerish suv. They have plans for commercial vehicles. They are pretty measured and how they talk about what they actually do. They are not bragging of having any great technology. They just have pretty neat vehicles. And they need some money. And we have a spac attack. Vonnie it looks like a tank. Will there be demand for this kind of vehicle . And also are there spacs out there that are looking for someone who just has 50 million . David they need more than that. The initial 50 million that they need, just to get the engineering to the next level, and they need a total of 250 Million Dollars to get their vehicles to market. So beyond that, they would they really wanted to expand even more. But 250 million is the purse they are looking at, the next two rounds of funding. That is easily easily something these spacs could do. Most of them have been given hundreds of millions to companies, which are also making electric trucks. To the demand question, yes, there is demand for commercial vehicles. You also have competition. You have General Motors which is doing this and gm is aligned with nicola, should that sort itself out in a positive way. They want to do commercial delivery vehicles. Youve got the big automakers all lying that area of the business. And Companies Like amazon, fedex, ups, Postal Services now want electric vehicles to deliver things. That is probably where you are going to see most of the i should say the next wave of growth in electric vehicles. Startups be the ones to capitalize on it . That is where it gets more dicey. Amanda only 30 seconds, but it is part of the appeal, the idea that one of the big automakers will buy it. That all of them will need this technology. David yeah, it is. It is twofold. The way tesla dude, you buy in big. And cash and or you buy in cheap and somebody like any big auto company says hey, i want to get into commercial electric trucks. And then they buy a piece, and they make it happen a lot faster. Vonnie im still gob smacked by what they look like, to be honest with you. It really just stunned me. That his bureau chief david welsh. Do have a read of his story and all of the stories out of detroit. From amanda in toronto and myself in new york, this is bloomberg. Mark i am Mark Crumpton with bloombergs first word news. Three of the four day confirmation hearing for sprint Court Nominee amy coney barrett. Members of the Senate Judiciary committee are getting another chance to question her. Chairman Lindsey Graham says he expects all republicans on the committee to support judge barretts confirmation and all democrats to oppose her. Republicans are pushing for the full senate to vote on october 22. Here in new york city, Officials Say they are making progress in curbing Coronavirus Infection rates in areas of brooklyns and queens where virus cases have been spiking recently. Mayor bill de blasio said there has been some leveling off in the socalled hot zones, but that more progress is needed to stop a second wave of covid19. The European Union is unveiling new plans to help slow down global warming. They include a strategy to tackle highly polluting methane gas emissions and a plan to renovate millions of Old Buildings to make them more energy efficient. The European Commission is also laying out plans to restrict the use of dangerous chemicals in toys,