AI Tech Giant Nvidia's $430B Wipe-Out; France's Airbus Tumbles | Bloomberg The Pulse 06/25/24
>> NEWSMAKERS AND MARKET MOVERS, THIS IS THE PULSE WITH FRANCINE LACQUA. TOM: GOOD MORNING AND WELCOME TO THE PULSE, I'M TOM MACKENZIE IN LONDON STEPPING IN FOR FENCING. HERE'S WHAT'S COMING UP, EUROPEAN STOCKS FALL ON GROWING SPECULATION THE TOPIC -- THE TECH RALLY MAY BE RUNNING OUT OF STEAM AFTER NVIDIA FELL INTO CORRECTION TERRITORY SHEDDING $430 BILLION IN VALUE IN THREE DAYS OF TRADING. AIRBUS TUMBLES DRAGGING IT SUPPLIES INTO THE RED AS THE PLANE MAKER LOWERS ITS EARNINGS AND DELIVERY TARGETS. PLUS, THE CHINESE PREMIER WARNS
OF A DESTRUCTIVE SPIRAL IF THE WORLD DECOUPLES FROM BEIJING. WE DISCUSSED THE PRESSURE ON GLOBAL SUPPLY CHAINS IN OUR EXCLUSIVE CONVERSATION WITH THE CEO OF MARSH MCLENNAN. THE SICK YOU LOOK ON HOW EUROPEAN MARKETS ARE PERFORMING, AIRBUS AND ITS SUPPLIERS ARE DRAG AS THIS TECH SECTOR. THERE'S A SHIFT INTO THE VALUE STOCKS ENERGY, UTILITY SEEING THE UPSIDE IN OTHERWISE PRESSURE EUROPEAN SESSION ACROSS THE BENCHMARK. YOU SEE LOSSES JUST SHY OF 4/10 OF 1%.
IF WE CAN GET YOU THE REGIONAL MAP, WE WILL SHOW YOU THE BREAK DOWN BECAUSE THE FTSE 100 IN THE U.K. IS PERFORMING SLIGHTLY BETTER THAN THE REST OF ITS PARTNERS, POSTING MODEST GAINS SHOULD SHY OF A 10TH OF A PERCENT. FTSE 100 FLAT AT 8002 HUNDRED 85 ADDING FOUR POINTS. THE CAP CROWD DOWN. WE CONTINUE TO MONITOR THE
POLITICS OF FRANCE AHEAD IN THE TWO ROUNDS THAT KICKS OFF THIS WEEKEND. DAX AND GERMANY TAKING A HIT DOWN. THAT'S WHAT THE BOARD AND LOOK AT THE U.S. FUTURES. IT WAS THE DRAG COMING THROUGH FROM NVIDIA. WE TALKED ABOUT MARKET VALUE,
THE BIGGEST THREE-DAY LOSS ON RECORD IN HISTORY, WHETHER OR NOT THIS IS A TURNING POINT FOR THIS MARKET OR A BUYING OPPORTUNITY WILL REMAIN A QUESTION, WE LOOK AT THE PREMARKET TRADING PRICE FOR NVIDIA WHEN THAT CROSSES IN THE NEXT FEW MINUTES. IN TERMS OF YOUR CROSS AS A BOARD WE RUN YOU THROUGH THE BENCHMARK, NOT A LOT OF VOLATILITY IN THE TREASURY SPACE. WE COUNT DOWN TO INFLATION DATA OUT OF THE U.S. ON FRIDAY WITH PERSONAL CONSUMPTION EXPENDITURES INDEX. A GAUGE FOR FED COMING THROUGH ON FRIDAY, THE JAPANESE YEN ONCE AGAIN IN FOCUS, INTERVENTION RISK, MUZUHO SAYING 170 COULD BE THE LINE YOU ARE LOOKING AT FOR THE JAPANESE YEN. THE LOWEST LEVEL THAT WOULD BE SINCE AROUND 1986. CURRENTLY 159 50, BRUSHING OFF
THE JOB BONE COMING THROUGH FROM JAPANESE OFFICIALS. BRENT TRADING AT $85 90 SEVEN. SPARKLE TAKING A KNOCK IN THE SESSION. DOWN 4/10 OF A PERCENT. NOW TO THE CENTRAL BANK STORY IN THE FED SAN FRANCISCO MARY DALY HAS WARNED THE U.S. -- MORE THE U.S. LABOR MARKET IS NEARING AN INFLECTION POINT WHERE FURTHER SLOWING COULD MEAN HIGHER UNEMPLOYMENT. CLICK SO FAR, THE ADJUSTMENTS
IN THE LABOR MARKETS HAVE BEEN MODEST, NOT REALLY PUSHING UP THE UNEMPLOYMENT RATE, BUT WE ARE GETTING NEARER TO A POINT WHERE THE OUTCOMES ON EMPLOYMENT MAY BE LESS BENIGN. TOM: JOINING US NOW IS HEAD OF GLOBAL AGGREGATE BONDS AT JP MORGAN ASSET MANAGEMENT. THANKS FOR JOINING US IN THE STUDIO. MARKETS PRICING INTO CUTS, 48 BASIS POINTS CLOSE TO THAT BY THE END OF THIS YEAR, THE DOT PLOT IS FOR ONE CUT, YOU TAKE INTO ACCOUNT WHAT WE HEARD FROM MARY DALY, WHAT ARE THE MARKETS PRICING AND WHEN IT COMES TO POTENTIAL FURTHER SOFTNESS IN THE LABOR MARKET, UNEMPLOYMENT 4%, MAYBE THERE'S FURTHER TO GO. LIKES I THINK THE MARKETS ARE PRICING THE FED TO BE CUTTING RATES IN LINE WITH THE FULL INFLATION. THAT'S THE FIRST THING.
WE HAVE THE PCE INFLATION DATA COMING UP ON FRIDAY AND THAT'S LARGELY KNOWN. BE BAD MODERATION IN THE LABOR MARKET, THAT HAS BEEN SEEN BY A FALLEN LABOR DEMAND SLIGHTLY DECLINING WAGES, WHICH IS ALL CONSISTENT WITH THE FED CUTTING EASING RATES IN A GRADUAL FASHION. THAT'S WITH THE MARKETS PRICE IN SEPTEMBER AND DECEMBER. I DON'T THINK THERE'S THAT MUCH DIFFERENCE BETWEEN THE MARKETS IN THE FED. AS WE SAW WITH THE FED, THE DOT PLOT IS BETWEEN ONE AND TWO CUTS.
CRITICALLY IT DEPENDS ON THE NEXT COUPLE OF INFLATION PRINCE RUPERT WHETHER THEY WILL BE CUTTING IN SEPTEMBER, I THINK IT'S LIKELY. THE RISK IS THAT THE UNEMPLOYMENT RATE OR THE LABOR MARKET DETERIORATES AT A SLIGHTLY FASTER PACE, THAT WILL SEE THE FED CUTTING RATES MORE AGGRESSIVELY, THE MARKET IS NOT PRICING THAT. TOM: WHAT WOULD BE THE METRICS THAT YOU WOULD LOOK AT THAT WOULD TELL YOU, THEY WILL HAVE TO GO HARDER? LEXUS THE PAYROLL DATA, LOOK AT THE HOLISTIC LABOR MARKET DATA AND YOU LOOK AT THE CLAIMS THAT ARE BROADLY TRACKING LEVELS THEY WERE TRACKING IN 2018, 2019 AND THE IMPLEMENT RATE HAS EDGED UP A LITTLE BIT, WE ARE LOOKING AT THE RULE WHICH IS SUGGESTED UNEMPLOYMENT GOES UP AND IT MOVES IN A LONG FASHION, BUT IT'S NOT A RULE, IT'S AN EMPIRICAL OBSERVATION. REALLY IT WILL BE ABOUT THE PAYROLL DATA AND IF THE PAYROLL DATA DECELERATES, IT WILL BE CONSISTENT WITH OTHER DATA THAT SHOWED THE WANING AND LABOR MARKET DEMAND AND THAT WOULD SEE THE MARKET PRICING IN A FASTER PACE OF CUTS.
IT'S NOT TO IGNORE FINAL SALES. THE KEY THING IS ABOUT THE OVERALL BALANCE OF THE ECONOMY, NOT THE LABOR MARKET AND ISOLATION. IT HAS TO BE CONSIDERED WITH THE WHOLE DATA. TOM: WE SCRUTINIZE THE PAYROLL DATA,
BUT IF WE GO BACK TO YOUR CONSENSUS OR YOUR BENCHMARK, YOUR BASELINE WHICH IS TWO CUTS FROM THE FED STARTING IN SEPTEMBER FOLLOWED BY DECEMBER, HOW MUCH OF THAT IS PRICED IN, DOES IT TRIGGER A BOND RALLY, IF SO, WHICH PART OF THE CURVE WILL BE MORE REACTIVE? >> IT DEPENDS ON THE MESSAGING BUT IT'S DEPENDED ON THE DATA. THE BOND MARKET LOOKS COMPELLING VALUE. TWO CUTS PRICED IS BROADLY WITH THE MARKETS ARE PRICED AND THEN PRICING EVERY QUARTER, THAT LOOKS QUITE REASONABLE. THE RISK THAT THE FED STARTS RAISING RATES LOOKS VERY LOW. WE SEEN INFLATION FALL VERY UGLY, WE'VE SEEN THE FED'S OWN RHETORIC BE ALONG THE LINES OF HOLDING RATES FOR A LONGER TIME. THAT SEEMS LOW RISK. SO THE QUESTION IS IF THE LABOR
MARKET DETERIORATES, WHAT POSITION DO YOU WANT TO PUT ON TODAY? THE KEY THING YOU WANT TO BE OVERWEIGHT IS THE BOND MARKET, YOU WANT TO PUT ON YIELD CURVE STEEPNESS BECAUSE IF THE LABOR MARKET DETERIORATES AT A FASTER PACE, WE COULD BE LOOKING AT 200, 3 HUNDRED BASIS POINTS OF FED RATE CUTS. THAT'S HOW YOU GET EXCESS RETURNS ON YOUR FIXED INCOME. TOM: WHERE WOULD THAT TAKE THE TWO-YEAR, 473 RIGHT NOW ON THE TWO-YEAR? EXIT COULD BE DOWN IN THE 2% LEVEL, THAT'S CONTINGENT -- TOM: BY THIS TIME NEXT YEAR WITH TIME FRAME? ALEXA MARKET WILL BE FAST IN TERMS OF PRICING A MUCH SHARPER PACE OF CUTS. THIS IS ALL CONTINGENT ON THE ECONOMIC DATA DETERIORATING AT A FASTER PACE, THAT'S NOT OUR CORE EXPECTATION, THE CORE EXPECTATION IS ACTUALLY FED RATE CUTS QUARTERLY PACED ENABLED THE EXPANSION TO CONTINUE. IT'S A CRITICAL INGREDIENT FOR THE SOFT LANDING SCENARIO, WHICH IS THE EXPANSION CONTINUES, WE DON'T GET A RECESSION, AND YOU HAVE A SITE.
OF MONETARY POLICY WHICH SUPPORTS CONTINUED EXPANSION. TOM: WHAT TO DO WITH FRENCH SOVEREIGN DEBT? IT'S ABOUT THE 80 BASIS POINT LEVEL, DOES THAT LOOK ATTRACTIVE TO YOU? SOME GUESS SAY YOU NEED TO GET TO A HUNDRED BASIS POINTS ABOVE BEFORE YOU DIP INTO THE MARKET. >> IS A VERY GOOD MARKET, WE ARE DEALING WITH THE SITUATION WE HAVE BEEN DEALING WITH ELSEWHERE, WHICH IS THAT MACRO SUPPORTS CARRY TRADE'S AND THEN YOU HAVE POLITICAL RISK, FOR THE MARKET THE FIRST THING IS, WHAT GOVERNMENT ARE WE GOING TO GET, DOES INCREASE UNCERTAINTY OR NOT? I HAVE SEEN THEIR RECENT COMMENTS THAT SUGGEST THAT IF THEY WERE IN CHARGE, THEY WOULD CONTINUE WITH A MORE MODERATE -- I HEARD THE PREVIOUS SPEAKER MIMICKING WHAT WE HAVE SEEN IN ITALY WITH THE MODERATE ECONOMIC POLICY HAD NOT LARGE FISCAL EXPANSION. I THINK THE OTHER KEY RISK IS OBVIOUSLY A HUNG PARLIAMENT, I THINK THAT'S NOT ABOUT FISCAL EXPANSION. I THINK THOSE TWO SCENARIOS TO SUPPORT OUR STABILITY IN THE EUROPEAN SOVEREIGN COMPLEX. IS FRANCE THE BEST PLACE TO BENEFIT FROM THAT, I WOULD SAY THERE ARE OTHER PLACES THAT OFFER BETTER RISK REWARD TODAY --.
ITALY HAS DOUBLED THE SPREAD OF FRANCE, ITALY HAS ALREADY GOT A FAR RIGHT GOVERNMENT, HAS ALREADY GOT THE MODERATE ECONOMIC POLICY, SO IT WILL MATCH ANY RALLY IN FRENCH BREADS. IF YOU HAVE UNCERTAINTY IN FRANCE, ITALY ISN'T GOING TO UNDERPERFORM FRANCE IN A SELLOFF. THERE ARE BETTER PLACE TO INVEST IN EUROPE. ITALY ONE, SPAIN BEING ANOTHER.
COVERED BONDS THAT GIVE A BETTER RISK REWARD THEM IN FRANCE WITH THE UPSIDE OF EARNING FRANCE IS 10, 15 BASIS POINTS. TOM: VERY INTERESTING THAT IT'S BENEFITING ON THE BACK OF FRANCE IF THOSE SCENARIOS PLAY OUT. WHERE ELSE DO YOU SEE OPPORTUNITY BEFORE I LET YOU GO? >> EMERGING MARKETS. WE HAVE SEEN THE POLITICAL EVENTS AND EMERGING MARKETS, EARLIER THIS MONTH INDIA, SOUTH AFRICA, MEXICAN ELECTIONS CREATED VOLATILITY. THERE IS ATTRACTIVE RISK PREMIUM.
THINGS LIKE MEXICO HAVE ALREADY FACTORED IN A LOT OF THIS RISK PREMIUM ABOUT A SHIFT IN ECONOMIC POLICY, I WOULD ARGUE BRAZIL IS ALSO ATTRACTIVE. AGAIN THERE WE CAPTURE RISK PREMIUM ASSOCIATED WITH THE SHIFT IN THE GOVERNMENT'S FISCAL APPROACH ON A SHIFT IN THE COMPOSITION OF THE CENTRAL BANK. I THINK KEEPING POWDER DRY TO BUY INTO MARKETS THAT HAVE SOLD OFF BECAUSE OF UNCERTAINTY IS THE BEST STRATEGY AT THIS MOMENT, AND THEN WHEN THAT UNCERTAINTY IS PRICED IN, IT'S TIME TO BUY THOSE. TOM: ALWAYS APPRECIATE YOU COME TO THE STUDIO. POTENTIALLY AT 2% LAID OUT. POTENTIALLY LOOKING AT ITALY,
SPAIN IN TERMS OF THE SOVEREIGN DEBT UPSIDE IF YOU GET SOME SCENARIOS BENIGN WHEN IT COMES TO THE FRENCH POLITICAL EVOLUTION. HEAD OF GLOBAL AGGREGATE BOND STRATEGIES THAT J.P. MORGAN ASSET MANAGEMENT. LET'S CHECK IN ON THE PREMARKET PRICING FOR NVIDIA GIVEN THAT ROUTE THAT WE HAVE SEEN IN THE MAKER OF GPU'S AND AI CHIPS, DOWN 1.3%, THE SELLOFF CONTINUES FOR NVIDIA AFTER THE HISTORIC MOVES WIPING OUT 430 BILLION U.S. DOLLARS. BACK BELOW MICROSOFT AND APPLE IN TERMS OF MARKET CAP WITH THE MARKET CAPTURES SHY OF $3 TRILLION.
IT'S GOT A TO HANDLE IN TERMS OF TOTAL MARKET CAP OF NVIDIA, BUT IT SEEMS LIKE THERE'S FURTHER PRESSURE ON THAT STOCK AS WE LEAD UP TO THE OPEN IN THE U.S. COMING UP, HOW EFFECTIVE OUR SUSTAINABILITY DISCLOSURES AND WHY ARE INVESTORS DEMANDING THEM? WE WILL SPEAK TO THE CHAIRMAN OF THE INTERNATIONAL SUSTAINABILITY STANDARDS BOARD. THAT IS NEXT. THIS IS BLOOMBERG. TOM: TUESDAY THE 25TH OF JUNE, WELCOME BACK TO BLOOMBERG.
THE CONVERSATIONS THAT MATTER, THE INSIGHTS YOU NEED. I'M TOM MACKENZIE IN LONDON. CARRIE AND CHEMICAL MANUFACTURERS AS THE INFLATION IT REDUCTION ACT WOULD NOT BE IMPACTED BY A TRUMP. SPEAKING TO BLOOMBERG THE COMPANY CEO DOESN'T EXPECT CHANGES IN U.S. SUSTAINABILITY SPENDING.
>> I DON'T THINK FUNDAMENTALLY THE SPEED OF IRA IN THE FRAMEWORK OF IRA WILL NOT CHANGE BECAUSE FUNDAMENTALLY, WHAT WE ARE LOOKING FOR IS MORE LOCAL PRODUCTION IN THE UNITED STATES AND MORE FOREIGN CAPITAL INTO THE UNITED STATES TO LOCALIZE THE SUPPLY CHAIN TO SECURE A SOURCE OF SUPPLY. SO I THINK THE FUNDAMENTAL FRAMEWORK WILL STAY THE SAME. HOWEVER, THERE MAY BE SOME SLIGHT CHANGES HERE OR THERE AND IT MAY BE INEVITABLE IN THE MIDST OF THE CHANGE.
TOM: WHY HE BELIEVES BIDEN'S SIGNATURE CLIMATE LAW WILL REMAIN UNCHANGED. LET'S DISCUSS SUSTAINABILITY DISCLOSURES AND WHY INVESTORS ARE DEMANDING THEM. I'M JOINED BY CHAIRMAN OF THE INTERNATIONAL SUSTAINABILITY STANDARDS FOR THE ISS BE. THANK YOU FOR JOINING US IN THE STUDIO. LET'S START WITH THE QUESTION OF HOW MUCH SUCCESS YOU AND THE TEAM HAVE HAD IN TERMS OF PERSUADING COUNTRIES TO ADOPT ISS STANDARDS INTO THEIR NATIONAL RULES, THE NATIONAL TERMINOLOGY.
HOW MUCH SUCCESS HAVE YOU HAD, HOW MUCH UPTAKE IS COMING THROUGH? >> THANKS FOR HAVING ME, IT'S GREAT TO BE HERE TO REPORT ON THE PROGRESS. WE STARTED AT COP 20 62 AND A HALF YEARS AGO, WE HAVE PUBLISHED OUR FIRST TWO STANDARDS, THAT GENERAL ACCOUNTING RULES FOR CLIMATE AND OTHER SUSTAINABILITY ISSUES, AND THE CLIMATE STANDARD EXACTLY ONE YEAR AGO, WHICH WE LODGED HERE IN LONDON. WE ARE ONE YEAR AFTER AND WE ALREADY HAVE MORE THAN 20 JURISDICTIONS, COUNTRIES THAT HAVE DECIDED TO ADOPT THE STANDARDS, WHICH MEANS BASICALLY 50% OF GLOBAL GDP, 50 PERCENT OF GREENHOUSE GAS EMISSIONS. I WOULD NEVER HAVE ANTICIPATED THAT IT WOULD GO SO FAST, SO FAR.
I THINK THE REASON IS BECAUSE THE RISKS AND OPPORTUNITIES ARE REAL. INVESTORS WANT TO UNDERSTAND AND COMPANIES WANT TO EXPRESS. TOM: 20 NATIONS SIGNING UP IN A SHORT TIME FRAME, WHO IS MISSING FROM THE LIST THAT YOU WOULD LIKE TO ADD? ASK THERE ARE A LOT IN THE GLOBAL SOUTH. WE HAVE JURISDICTIONS LIKE SRI LANKA, BANGLADESH AND OTHERS, WHICH IS ABSOLUTELY GREAT BECAUSE YOU CANNOT HAVE A SUSTAINABLE BUSINESS MODEL GLOBALLY OR MACRO ECONOMICS WITHOUT HAVING AN INCLUSION OF ALL IN THE SUPPLY CHAINS. THOSE SUPPLY CHAINS ARE GLOBAL.
YOU NEED TO HAVE THOSE EMERGING ECONOMIES. BUT STILL LISTENING -- MISSING A HUNDRED ON ONE SIDE AND THEY WILL COME OVER TIME, GIVEN THEIR GRAVITAS AND THE GRAVITATIONAL FORCE THAT HAS STARTED WITH THIS NEW PLUS JURISDICTIONS. TOM: WHAT IS THE KIND OF RESISTANCE YOU MIGHT FACE FROM SOME COUNTRIES ARE RELUCTANCE IF THAT COMES THROUGH? >> I THINK IT'S A MATTER OF INVESTMENT BECAUSE FINANCIAL STATEMENTS ARE IN PLACE WITH A FOUNDATION THAT HOSTS OUR WORK AND IS A PUBLIC GOOD ENTITY THAT HAS PROVIDED ACCOUNTING SYSTEMS ACROSS 100 40 DIFFERENT COUNTRIES IN THE LAST 25 YEARS. FINANCIAL STATEMENTS DON'T, BECAUSE OF THE RULES, USEFUL RULES, THEY DON'T ALLOW TO EXPRESS ALL THE RISKS AND OPPORTUNITIES THAT ARE DOWN IN THE SUPPLY CHAINS IN THE ME TOO HORIZON, YET, COMPANIES WANT TO EXPRESS THAT. THIS IS WHY THERE IS SUCCESS BEHIND WHAT WE DO.
YET, IT IS AN INVESTMENT BECAUSE YOU NEED TO UNDERSTAND WHERE YOUR SUPPLY CHAIN IS, ADOPT THIS LANGUAGE, IT'S FULL OF MANY THINGS THAT I THINK THAT CFOS, THE CHIEF INVESTMENT OFFICER'S, THE CHIEF INVESTOR OFFICERS AS WELL NEED TO GRASP THE ASSURANCE PROFESSION NEEDS TO BE THERE OF COURSE, BECAUSE THE VERY SPECIAL ASPECT OF OUR ACCOUNTING LANGUAGES THAT IT WOULD BE ASSURED. THEREFORE IT WOULD BE RELIED UPON IN INVESTORS ARE GOING TO BE ABLE TO ALLOCATE CAPITAL AGAINST THOSE RISKS AND OPPORTUNITIES IN A MANNER THAT IS COMMENSURATE FOR THE PRICE AT WHICH THEY WILL BE ABLE TO ALLOW THOSE RESOURCES, WHICH WOULD CREATE A COMPETITIVE ADVANTAGE FOR MANY COMPANIES. THE RESISTANCE ISN'T IN THE FACT THAT IT IS AN INVESTMENT, IT'S PROBABLY A ONE-TO YOUR INVESTMENT IN A LONG PROCESS BEFORE IT REALLY STARTS COMING, AND WE KNOW IT'S GOING TO BE A JOURNEY. TOM: A BIG QUESTION IS HOW YOU GET
THAT GLOBAL UPTICK IN TERMS OF AGREEMENT IN TERMS OF THE TERMINOLOGY AND REPORTING AND ALIGNING IN THE NUMBER OF ORGANIZATIONS INCLUDING THE ISS BE HAVE TRIED TO ALIGN MORE CLOSELY TOGETHER. HOW MUCH PROGRESS HAS YOU MAY -- HAVE YOU MADE ON THAT FRONT AND WHAT DOES IT MEAN FOR COMPANIES? >> THE BEST THAT I COULD SAY IS THE 50% OF GDP, GLOBAL GDP IS NOW LOCKED FROM COMMITMENT BY JURISDICTIONS TO PROGRESS ON THEIR JOURNEY TOWARDS THE ADOPTION OF THE STANDARD. SO IT MEANS IN AT LEAST HALF OF THE GLOBAL ECONOMY, IF YOU GET THERE IN A COUPLE OF YEARS TIME, THERE WILL BE A COMMON LANGUAGE ABOUT THOSE DISCLOSURES THAT YOU CAN DESCRIBE IT AS PART OF YOUR FINANCIAL REPORTING TO INVESTORS AND INTO BANKS. NOW, THERE'LL BE A COST FOR NOT JOINING, YES, IT IS AN INVESTMENT, BUT IF YOU ARE OUTSIDE OF THAT OR DEVELOP A SPECIFIC LANGUAGE THAT IS REALLY YOURS WITHOUT FUNDAMENTALLY USING THAT BASELINE, YOU CAN ALWAYS ADD MORE IF YOU WANT TO, BUT MAKING SURE THERE IS NO CARVEOUT TO THIS BASELINE IS FUNDAMENTAL FOR INVESTORS AND BANKS TO UNDERSTAND ALL THE RISKS AND OPPORTUNITIES. THEREFORE THERE WOULD GRADUALLY BE A COST OF NOT JOINING, AS LONG AS THE GRAVITATIONAL FORCE CONTINUES TO BUILD AROUND THE MOMENTUM. TOM: THERE'S A GAP, THERE'S A DIFFERENCE BETWEEN DISCLOSING AND TAKING ACTION.
I'M TRYING ON YOUR EXPERIENCE AS A FORMER CEO, WHEN I ASKED THIS QUESTION, DOES IT NEED TO BE LEGALLY BUILT INTO THE SYSTEM? THERE ARE LEGAL RAMIFICATIONS FOR COMPANIES THAT DO NOT TAKE ACTIONS. THERE ARE CONSEQUENCES, FISCAL, LEGAL CONSEQUENCES. WITH THAT BE SOMETHING YOU ADVOCATE FOR? >> IT'S NOT MY RULE. WE PROVIDE TRANSPARENCY. WE ARE NOT ASKING COMPANIES TO TAKE ASKING, WE ARE ASKING THEM IF THEY TAKE ACTION OR IF THEY SAY THEY TAKE ACTION, WHAT KIND OF ACTION, AND PRECISELY DESCRIBING THEIR ACTION IN A MANNER COMPARABLE WITH COMPETITORS SO INVESTORS CAN UNDERSTAND WHO IS GOING TO BE MORE RESILIENT, AT WHAT COST, IF YOU TAKE CLIMATE, WITH IS AN ISSUE ALREADY WILL BE HERE TO COMPETITORS THAT ARE WILLING AND SAYING THAT THE PLAN TO INCREASE THE MARKET SHARE, IF ONE OF THE FACTORIES OR THE SUPPLY CHAIN OR THE TRANSPORTATION RELATED TO WATER, AND MANY OTHER THINGS HAPPENS TO PLAY AGAINST THAT COMPANY VERSUS THE OTHER ONE, THERE WOULD BE A COST. THIS IS
EXACTLY WHAT INVESTORS WANT TO UNDERSTAND. TOM: THE COST IS ALREADY THERE. WE HAVE TO LEAVE IT THERE, CHAIRMAN OF ISS BE ON HOW THE STORY IS EVOLVING IN TERMS OF GETTING CLOSE TO THE POINT WHERE YOU HAVE A GLOBAL LANGUAGE IN A GLOBAL SET, AND A GLOBAL FRAMEWORK AROUND SUSTAINABILITY. AIRBUS SHARES SWAP ON THE FOR YOUR GUIDANCE. WE DIG INTO WHAT IS HOLDING TOM: WELCOME BACK, LET'S BRING IN BENEDICT BECAUSE AIRBUS SHARES ARE DOWN HEAVILY, CLOSE TO 11% ON THE BACK OF A CHANGE TO ITS GUIDANCE, CUT TO ITS GUIDANCE.
BOOT -- BLOOMBERG'S GLOBAL AVIATION EDITORIAL LEADER. WHAT'S GOING ON AIRBUS? >> A LOT OF NEGATIVE THINGS GOING ON AIRBUS. THEY CAME OUT WITH THAT PROFIT REVISION LAST NIGHT.
IT WAS A WHOLESALE CUT ACROSS THE BOARD. THEY REDUCED THE NUMBER OF PLANES THEY WANTED TO DELIVER THIS YEAR TO 770 TO 800. THEY CUT THE CASH FORECAST IN THE OPERATING PROFIT FORECAST, THEY CUT THEIR LONGER-TERM PRODUCTION FORECAST FOR THE A320 AIRCRAFT, SO REALLY QUITE A WHOLESALE DOWNGRADE, A LOT OF ANALYSTS QUITE SPOOKED. WE SEE IT IN THE STOCK REACTION THIS MORNING, AIRBUS SHARES DOWN 10 PERCENT. IT'S A STEEP DROP FOR A COMPANY OF THIS SIZE. YOU SEE IT NOT JUST WITH AIRBUS BUT THERE'S ALSO COLLATERAL DAMAGE, THE FRENCH ENGINE MAKER IS DOWN, YOU SEE IN GUN GERMANY DOWN, REALLY ACROSS THE BOARD IS QUITE A BLOODBATH. TOM: BLOOMBERG'S GLOBAL AVIATION
EDITORIAL LEADER ON AIRBUS. COMING UP, WE FOCUS ON SUPPLY CHAINS AND GEOPOLITICAL RISKS WITH THE CEO OF MARSH MCLENNAN. THAT'S COMING UP. THIS IS BLOOMBERG. TOM: WELCOME BACK. EUROPEAN STOCKS FALL ON GROWING SPECULATION THAT TECH RALLY MAY BE RUNNING OUT OF STEAM.
THE U.S. FALLS AFTER LOSING $430 BILLION IN THREE DAYS TRADE. AIRBUS LOWERS ITS EARNINGS AND DELIVERY TARGETS PLUS THE CHINESE PREMIER WARNS OF A DESTRUCTIVE SPIRAL IF THE WORLD DECOUPLES FROM BEIJING. WE DISCUSS THE PRESSURE ON GLOBAL SUPPLY CHAINS WITH THE C.E.O. OF MARSH MCCHEYENNEAN. NEGATIVE CONSEQUENCES FOR WORLD IF COUNTRIES CHOOSE TO ECONOMICALLY PART WAYS WITH BEIJING AND THE WORLD’S SECOND LARGEST ECONOMY. ALSO HIT BACK AT CRITICISM THE
INDUSTRIAL POLICY HAS LED TO OVERCAPACITY. >> MAXIMIZING ONE’S OWN BENEFITS AT THE EXPENSE OF OTHERS’ INTERESTS ARE EITHER RESORTING TO REGRIFSZ ACTIONS OF DECOUPLING, DISRUPTIVE SUPPLY CHAINS WOULD ONLY PUSH UP OPERATIONAL COSTS, SEVERE THE ECONOMIC LINKS AND AGGRAVATE TENSIONS. THIS WOULD DRAG THE WORLD INTO A DESTRUCTIVE SPIRAL WHERE THE FIERCE COMPETITION FOR A LARGER SLICE ENDS UP IN A DIMINISHING PIE. THIS IS SOMETHING WE DO NOT WANT TO SEE. TOM: THE CHINESE PREMIER THERE SPEAKING AT THE WORLD ECONOMIC FORUM WARNING AGAINST WHAT HE CALLED REGRESSIVE ACTIONS. FOR MORE, I’M JOINED BY JOHN DOYLE. C.E.O.
OF MARSH MCLENNAN. YES, INFLATION IS MODERATING BECOMING LESS OF A CONCERN POST PANDEMIC BUT THE SUPPLY ISSUE IS A PROBLEM, LIKE AIRBUS. THE TENSIONS BETWEEN CHINA AND THE U.S. AND OTHER TRADING PARTNERS, THE E.U. AS WELL REMAIN PRONOUNCED. HOW ARE YOUR CLIENTS ADJUSTING TO THIS? >> IT IS GREAT TO BE WITH YOU THIS MORNING. THERE IS A COMPLEXITY TO THE EVENTS OF TODAY THAT IS A CHALLENGE FOR OUR CLIENTS ALL OVER THE WORLD.
BROADER GEO-POLITICAL RISKS ARE CHALLENGE OF COURSE. WE HAVE ECONOMIC INFLATION, CHALLENGES LIKE SUPPLY CHAIN, TIGHT LABOR MARKETS, TARIFFS, ISOLATIONISM IN CERTAIN PARTS OF THE WORLD, FREQUENCY OF EXTREME WEATHER EVENTS AND SOCIAL ISSUES, SOME FROM GEO-POLITICAL RISKS. THERE IS A COMPLEXITY TO EVENTS THAT BUSINESSES ARE TRYING TO NAVIGATE. I’M PROUD OF THE WORK OUR COLLEAGUES ARE DOING, TRYING TO HELP THEM MAKE DECISIONS. TOM: THE HERE AND NOW IS ONE OF THOSE STAND OUT.
ALL OF THOSE ISSUES COMING INTO PLAY. IS THERE ONE THAT IS REALLY DRIVEN HOME TO YOU WHEN YOU SPEAK TO CLIENTS THAT IS A CONCERN RIGHT NOW? >> BROADER GEO-POLITICAL RISKS AND THE ECONOMIC CONSEQUENCES OF THE AYE POLITICS OF TODAY SITS AT THE TOP OF THE LIST BUT TO ME WHAT STANDS OUT IS ALL OF THESE ISSUES. WE HAVE CONFRONTED ALL OF THESE ISSUES IN THE PAST BUT THEY ARE AT AN ELEVATED LEVEL TODAY. TOM: WE FOCUS ON THE ECONOMIC SIDE O
BUSINESS. SLOWING SOME COMPETITORS STARTING TO REDUCE COSTS AND HEAD COUNT AS WELL IN A TARGETED WAY. IS THAT SOMETHING THEY ARE GOING TO HAVE TO THINK ABOUT DOING? >> OLIVER WIEMAN IS PART OF A UNIQUE MIX OF CAPABILITIES ACROSS RISK, STRATEGY AND VARIOUS PEOPLE-RELATED ADVISORY BUSINESSES. INCREASINGLY WE’RARDING THESE
CHALLENGES THAT OUR CLIENTS ARE CONFRONTING TOGETHER. WE’RE GOING TO DON’T INVEST IN OUR CONSULTING CAPABILITIES. THE DEMAND FROM THE EVENTS OF TODAY REMAINS STRONG FOR SERVICES WE PROVIDE. >> WHAT DOES THAT MEAN FOR HEAD COUNT? >> WE HAVE ADDED TO HEAD COUNT AND MADE SOME MINOR BUT STRATEGIC ACQUISITIONS OVER THE LAST COUPLE OF YEARS AND WE ARE GOING TO LOOK THROUGH THE CYCLE AND CONTINUE TO INVEST OUR BUSINESSES TO HP OUR CLIENTS. TOM:
ARE YOU GETTING A SENSE THAT CLIENTS ARE BECOMING MORE CAUTIOUS? >> I THINK MANY OF OUR CLIENTS ENTERED THE YEAR A BIT MORE DEFENSIVELY GIVEN ALL OF THE EVENT WE TALKED ABOUT HERE THIS MORNING. BUT OUR ROLE IS TO HELP THEM GET THE CONFIDENCE TO THRIVE THROUGH COMPLEXITY. WE’RE WORKING THEM SO THEY CAN MAKE DECISIONS AND PUT CAPITAL TO WORK. TOM: WHERE ARE YOU SEEING THE
STRONGEST DEMAND? WE’RE HEARING THE MIDDLE EAST IS PRETTY STRONG. >> THE MIDDLE EAST HAS BEEN AN AREA OF STRENGTH FOR OUR CONSULTING BUSINESSES. WE’RE SEEING GOOD GROWTH IN EUROPE AS THE CONTINENT CONTINUES TO NAVIGATE ALL OF THE ISSUES THAT WE HAVE TALKED ABOUT. WE HAVE SEEN GENERALLY GOOD DEMAND FOR OUR SERVICES AROUND THE WORLD. TOM: DO YOU THINK YOU MIGHT BE MOVING HEAD COUNT FROM EUROPE? >> THE TIMING OF THAT COULDN’T HAVE BEEN BETTER FOR US. MORE IMPORTANT THAN WHAT IT MEANS FOR US IS HELPING ECONOMIES AND COLLEGIATES HELP NAVIGATE ALL OF THIS UNCERTAINTY TODAY. TOM: HOW INQUISITIVE DO YOU PLAN ON
BEING? AND WHAT ARE YOU LOOKING AT? >> WE HAVE BEEN A CONSOLIDATOR IN OUR 153-YEAR-OLD BUSINESS. WE EXPECT TO PUT CAPITAL TO WORK ORGANICALLY. WE SEE ATTRACTIVE OPPORTUNITIES IN OUR RISK BUSINESS. 2019, ACROSS ALL OF OUR BUSINESSES WE CONTINUE TO SEE ATTRACTIVE OPPORTUNITIES. TOM: ON THE ADVISORY SIDE WITH FOCUS
ON TECHNOLOGY, LEW THINKING ABOUT THAT DEMAND AROUND INTEGRATING SOME OF THIS GENERAL RAIFT AI AND MAKING SURE THE SPEND IS EFFICIENT. THERE IS A CONCERN THAT CFO’S ARE UNDER PRESSURE TO INVEST IN AI WHEN THE OUTCOMES IS NOT NECESSARILY THAT CLEAR. >> LET ME START WITH US. WE’RE EXCITED ABOUT THE POSSIBILITIES OF AI. WE HAVE BEEN INVESTING AGAINST THOSE POSSIBILITIESES. THEY ARE HELPING TO BRING OUR
CLIENTS THROUGH. WE’RE OPTIMISTIC. I THINK THE VALUE CREATION, THE SCALE VALUE CREATION IS NOT IN 2024 OR LIKELY IN 2025. OUR CLIENTS ARE IN DIFFERENT PLACE. THERE IS A RANGE OF THAT BUT WE’RE HELPING OUR CLIENTS THINK THROUGH THAT. THE IMPACT TO OUR BUSINESSES CAN BE QUITE MEANINGFUL OVER TIME. TOM: DO YOU SEE IT AS A VALUE ADD OR IS IT A COST EFFICIENT STORY AS WELL? >> I THINK THERE IS SOME OF BOTH.
THE USE CASES WE’RE DEVELOPING TODAY ARE GOING TO MAKE OUR TALENTED PROFESSIONALS EVEN BETTER. TOM: SOME OF THE CHALLENGES IN CLIMATE CHANGE. LEW THINKING ABOUT THAT PART OF THE BUSINESS? WHAT ARE PREMIUMS LOOKING LIKE? >> THE REASSURANCE MARKET PLAYS A CRITICAL ROLE IN FINANCING EXTREME WEATHER. WE HAVE SEEN IT HERE IN EUROPE WITH INCREASED FLOODING, WILD FIRE RISK IN ITALY AND GREECE. INCREASED FREQUENCY HAS BEEN HAPPENING ALL OVER THE WORLD. THE REASSURANCE MARKET AFTER SEVERAL YEARS OF LOSSES REALLY ADJUSTED IN EARLY 23 AND ALL THROUGHOUT 2023.
MARKETS HAVE SETTLED A BIT. WE’LL SEE AS WE ENTER THE HIRK SEASON, THE WIND SEASON IN PARTICULAR IN THE UNITED STATES WHERE THERE IS A MASSIVE AMOUNT OF INSURED VALUE. THAT WILL HAVE AN IMPACT ON WHAT HAPPENS TO THE INSURANCE CYCLE IN 2024. IT IS A MUCH MORE ORDERLY MARKET TODAY. CLEARLY THE COST OF RISK IS RISING. TOM: IS THAT THE NEW NORMAL IN TERMS OF THE COST OF RISK? >> I THINK IT IS. IT IS NOT JUST RELATED TO
WEATHER. THERE IS INFLATION IMPACTING AND SOCIAL INFLATION IMPACTING THE WORLD. WE’RE STILL DIGESTING THE IMPACTS OF SUPPLY CHAIN ISSUES AS WE TALKED ABOUT A BIT. CLEARLY THE COST OF RISK IS RISING FASTER THAN GDP IS. TOM: INFLATION OF COURSE CONTINUING
CONCERNS ABOUT THE GLOBAL ECONOMY AND HOW IT ADJUSTS TO SOME OF THOSE CHALLENGE AND HOW CORPORATES ARE THINKING ABOUT INSURING AGAINST THOSE RISKS. COMING UP, WHAT IS BEHIND THE NVIDIA SELLOFF. RAISED MORE THAN $400 BILLION FROM THE COMPANY’S MARKET CAP. WHAT DOES IT TELL US ABOUT THE APPETITE AROUND THE MAKER OF TOM: THE COMMENTS THAT MATTER AND THE INSIGHT YOU NEED. THIS IS "THE PULSE." WIPING OUT $430 FROM INVADIA’S MARKET CAP.
WE WAIT TO SEE WHERE THIS SIGNALS MORE CONCERN ABOUT THE SEMICONDUCTOR SPACE CERTAINLY HERE IN EUROPE. THERE HAS BEEN A CHALLENGE TO HAVE PRICING IN THE SESSION TODAY ACROSS THE SEMICONDUCTOR MAKEERS IN EUROPE. THE MARKET TURNING AROUND SLIGHTLY POINTING TO MODEST GAINS OF .6%. THE BIGGEST DROP IN MARKET
VALUE OF A PUBLICLY LISTED COMPANY IN HISTORY EVER. AT THIS POINT FOR THE DETAILS LET’S BRING IN JOE EASTON. WHAT IS THE REASON FOR THIS SELLOFF OF NVIDIA? JOE: THIS WERE NOT ANY FUNDAMENTAL REASONS FOR IT. NVIDIA OVERTOOK MERCK BECOMING THE LARGEST COMPANY. ONLY THE OVERBOUGHT TERRITORY. IT RALLIED TOO HARD AND FAST.
THEREFORE THERE ARE CONCERNS WE MIGHT BE IN BU BUBBLE TERRITORY. WE HAD NEWS OF BEING A 1% STOCK SPLIT. YOU WOULD THINK THAT WOULD BE A POSITIVE BUT IT CAME AT A TIME WHEN THAT POSITIVE NEWS SENT THE STOCK LOWER. TOM: SOME INSIDER TRADING AS WELL,
NOTHING WRONG WITH THAT. EXECUTIVE C.E.O.S. THE CFO. PERFECTLY LEGITIMATE. WHAT ARE THE NEXT CATALYSTS THAT MARKETS ARE LOOKING FOR IN THAT THERE IS A POTENTIAL TURNAROUND FOR NVIDIA? JOE: TRADERS ARE LOOKING AT TECHNICAL LEVEL WHERE IS YOU MOOGHT HAVE SEEN THE STOCK WITH TECHNICAL RESISTANCE. IF IT GOT DOWN TO 100 YOU WOULD START ASKING SERIOUS QUESTIONS. THE OTHER THING IS BROADLY IF
WE GET TO THE EARNINGS SEASON, WE MOOGHT SEE THE IMPACT OF AI ON EARNINGS, IF OTHER COMPANIES START SAYING WE’RE SEEING THE IMPACT IN OUR EARNINGS REPORTS, THAT COULD BE A CATALYST. WE’RE PROBABLY A FEW YEARS AWAY FROM THAT BUT IF WE START TO SEE THE INITIAL IMPACT OF AI ON CHIP MAKERS LIKE NVIDIA AND OTHER COMPANIES THAT MIGHT MAKE PEOPLE BUY THIS RALLY ONCE AGAIN. TOM: YEAR TO DATE THE S&P WITH THOSE DOUBLE DIGIT GAINS, 1/3 COMING FROM THE UPSIDE OF NVIDIA. ACCOUNTING FOR ABOUT 1/3 OF THE GAINS THE S&P HAS POSTED SO FAR YEAR TO DATE. THERE HAS BEEN A HAMMERING AROUND THE CONCENTRATION RISK. HOW DO YOU SEE THAT STORY EVOLVE? WHAT ARE MARKET WATCHERS FOCUSING IN ON WHEN IT COMES TO THE EVOLUTION? DO YOU EXPECT TO SEE A BROADENING OUT? JOE: I SAW ANOTHER STAT TO ADD TO THOSE.
40% OF THE S&P IS EXPOSED TO AI. IN TERMS OF THE CONCENTRATION THESE TECH STOCKS ARE SUCH A BIG PARKING LOT OF THE MARKET BUT THEN AGAIN IT IS AN UNCERTAIN PART OF THE MARKET BECAUSE IT IS EXPOSED TO THE INTEREST RATE THEME. WE THINK THERE WILL BE RATE CUTS AND THAT IS POSITIVE AND THEREFORE IT SHOULD MOVE THE ENTIRE MARKET BUT IF IT IS NOT AS FAST AS EXPECTED, THE BIG YOU --THE BIGGER CHUNK OF THE MARKET IS EXPOSED. THE BIG THING -- GOING TO CONTINUE SAYING IS THE AI IMPACT AND YOU KNOW, ALMOST HALF OF THE S&P 500 NOW HAS A STAKE IN THE OUTLOOK. TOM: THANK YOU VERY MUCH INDEED FOR WHAT IS MOVING AND PLAYING INTO THIS NVIDIA STORY. JUST SHY OF 8% IN TERMS OF
GAINS. COMING UP, INVESTMENT FIRMS HAVE BEEN BOOSTING THEIR EXPOSURE TO INFRASTRUCTURE AND ENERGY. WE LOOK AT WHY THE CHAIRMAN OF SUSTAINABLE INFRASTRUCTURE ACTUS AND THE FOCUS OF THAT TOM: THE CONVERSATIONS MATTER AND THE INSIGHTS YOU NEED. THIS IS "THE PULSE."
I’M TOM MCKENZIE IN LONDON. MAJOR FIRMS ARE BOOSTING THEIR EXPOSURE TO INFRASTRUCTURE. I’M JOINED NOW BY THE CHAIRMAN AND SENIOR PARTNER AT ACTUS. TALK TO US ABOUT THE MASSIVE SPENDING ON INFRASTRUCTURE AND ENERGY. WHETHER THAT IS DATA CENTERS FEEDING THAT AND SUPPORTING THAT. ALL OF THE ENERGY SHIFT.
THIS IS HAPPENING AT PACE. HOW IS ACTUS PLAYING A ROLE IN THAT? WHAT IS YOUR ROLE? >> IT IS A MASSIVE COLOSSAL CHALLENGE AND ALSO AN OPPORTUNITY. WE FOCUS ON THE NON-U.S. NON-E.U. MARKETS. THAT’S WHY YOU HAVE 85% OF THE WORLD POPULATION AND 2/3 OF THE OPPORTUNITY IN INFRASTRUCTURE AND ENERGY TRANSITION. WHY? YOU ONLY HAVE 1/3 OF THE
CAPITAL CHASING IT. THAT CREATES A VERY, VERY ATTRACTIVE INVESTMENT PROPOSITION FOR US IN THOSE MARKETS. ENERGY TRANSITION IS THERE. IT IS MORE IMPORTANT THAN EVER IN THE MARKETS WE INVEST IN.
TOM: LESS COMPETITION, ARGUABLY. WHAT ARE THE RISKS IN INVESTING IN SOME OF THOSE ENVIRONMENTS? HOW MUCH POLITICAL INSURANCE DO YOU NEED BEFORE YOU PUT CAPITAL TO PLAY? >> I THINK IF YOU LOOK AT RISK, IT IS A QUESTION OF SUPPLY AND DEMAND OF CAPITAL AND OPPORTUNITIES. IF YOU TAKE THAT STANCE, DO YOU WANT TO BE IN MARKET WHERE IS THE PRODUCT YOU’RE SELLING, ELECTRICITY IS IN SHORT SUPPLY OR DO YOU WANT TO BE IN A MARKET WHERE THERE IS AN OVERSUPPLY OF ELECTRICITY AND YOU DEPEND ON THE REGULATORS TO BE SURE YOU HAVE THE PRIORITY. PEOPLE ARE DESPERATE TO GET THEIR HANDS ON ELECTRICITY. TOM: WHICH PARTS OF THE ECOSYSTEM
ARE PROVIDING THE MOST OPPORTUNITIES FOR ACTICE RIGHT NOW? ACTIS NOW? >> ACROSS THE BOARD, WE’RE ON THE GENERATION SIDE, TRANSMISSION SIDE AND ELECTRIC DISTRIBUTION SIDE. TOM: HERE IN THE U.K., ENERGY, AI IS EXPECTED TO SUCK UP 500%. 5 507B% MORE ENERGY IN THE NEXT DECADE. 3% FROM TWO YEARS AGO. THE DEMAND IS GOING TO BE EXCESSIVE. HOW DO YOU THINK INDUSTRY MEETS THAT DEMAND? IS THAT AN AT ANY TIME FOR YOU? >> IT IS A MASSIVE OPPORTUNITY. IF YOU’RE LOOKING AT THE GROWTH ON A GLOBAL BASIS AND LOOKING AT THE NEXT 20 YEARS, ELECTRICITY DEMAND WILL SOMEHOW DOUBLE.
WE NEED TO BUILD MORE POWER PLANTS. TOM: IS THAT FEASIBLE IN THIS ENVIRONMENT? >> I THINK SO. IT IS A CHALLENGING OPPORTUNITY. THE ELECTRICITY SYSTEM, EVERYTHING FROM GENERATION, TRANSMISSION AND DISTRIBUTION IS HUMANKIND’S LARGEST INVESTMENT EVER. WE’RE GOING TO DO THAT OVER THE NEXT 20 YEARS. ON TOP OF THAT, THE EXISTING PLANET NEEDS TO BE DECARBONIZED. THE QUESTION, YOU KNOW, WILL
ALL OF THAT COME THROUGH? WHAT IS THE PACE? IF IT COMES IN THE PACE THAT YOU KNOW, YOU FORECAST OR NOT, IT DOESN’T REALLY MATTER. THE OPPORTUNITIES ARE HUGE. AI, IS GOING TO PLAY A VERY IMPORTANT ROLE IN THAT GROWTH. TOM: POST PANDEMIC, PHYSICALLY CONSTRAINED.
BUSINESSES UNDER PRESSURE. IS THAT A CHANNEL FOR YOU OR AN OPPORTUNITY? >> IT IS CLEARLY AN OPPORTUNITY. IF YOU’RE IN THE MARKETS ACROSS LATIN AMERICA, MIDDLE EAST, AFRICA.
EUROPE, THE PRIORITIES OF THE SPENDING IF PRIVATE CAPITAL IS AVAILABLE TO HELP OUT AND INVEST INTO THE ELECTRICITY SECTOR AND HELP OUT THE ENERGY AND GETTING GREERN ENERGY IT IS GREAT. A WIN-WIN FROM BOTH SIDES. TOM: ON THE RISK, WE HAVE HAD ELECTIONS IN INDIA. MEXICO C.E.O. KO AS WELL. THERE IS CONCERN ABOUT A TILT TOWARDS A GOVERNOR WHO MAY BE MORE INTERESTED IN INTERVENING MORE IN SOME SPACES PARTICULARLY IN THE PRIVATE SECTOR. HOW DO YOU MITIGATE THOSE -- THE RISK OF A GOVERNMENT STEPPING IN AND SAYING WE’RE GOING TO SET THE PRICING AROUND ENERGY. WE’RE GOING TO TAKE OVER UTILITIES. HOW DO YOU FACTOR THAT? N?
>> COMING BACK TO THE SAME SUPPLY AND DEMAND. THE IF YOU’RE LOOKING AT, YES, MORE LEFT WING. THERE IS SOME NOISES ABOUT WHAT THAT MEANS FOR THE PRIVATE SECTOR. HOWEVER SHE HAS BEEN VERY CLEAR THAT ELECTRICITY AND MAKING SURE THAT YOU COVER THAT SHORTAGE OF ELECTRICITY NEEDS THE PRIVATE SECTOR TO PARTICIPATE. WE HAVE INVESTED A LOT. TOM: ARE YOU CONCERNED ABOUT THE
POLITICS OF MEXICO NOW? >> WE ARE CAUTIOUS ABOUT THAT. THE AMOUNT OF INVESTMENTS THAT ARE REQUIRED AND IF A POLITICIAN CANNOT DELIVER RELIABLE ELECTRICITY TO PEOPLE, THAT IS A DISASTER FROM A POLITICAL POINT OF VIEW SO THEY NEED AND WANT THE PRIVATE SECTOR TO COME IN AND PARTICIPATE AND HELP OUT AND MAKING SURE THAT THAT THE DELIVERY OF ELECTRICITY HAPPENS. TOM: YOU’RE IN THE PROCESS OF BEING ABSORBED BY GENERAL ATLANTIC. WHAT DOES IT MEAN FOR YOUR BUSINESS? >> SO MUCH LOOKING FORWARD TO JOIN FORCES WITH GENERAL ATLANTIC. WE WILL BECOME A STRONGER PLATFORM. WE WILL CONTINUE WHAT WE’RE
DOING AND OFFER SOLUTIONS TO OUR CUSTOMERS, IF THEY WANT GROWTH, EQUITY, MORE VENTURE, CREDIT, TECH INVESTMENT INTO THE CLIMATE SPACE. OR FOR US, WHAT WE DELIVER, BORING, CASHFLOWS. TOM: YOU DIDN’T MAKE IT SOUND BORING. THANKS SO MUCH FOR COMING INTO
THE STUDIO. WE APPRECIATE IT. CHAIRMAN AND SENIOR PARTNER AT ACTIS. WE’RE GOING TO KEEP ACROSS THE NVIDIA STORY FOR YOU AND THE SUPPLY STORY WITH AIRBUS WITH THAT DOWNGRADE. ALSO AS COMPETITORS WE WATCH OF
COURSE BOEING AND ITS SUPPLY CHAIN. AIRBUS DOWN 10.5%. NVIDIA WIPE OUT $430 BILL GALLON MARKET CAP IN THE LAST THREE TRADING DAYS. "BLOOMBERG BRIEF"
2024-06-27 13:20
