Alexey Navalny, Jailed Activist Who Defied Putin, Dies at 47

Published Feb 16, 2024, 9:22 PM

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Dr. Ariel Cohen, Senior Fellow at the Atlantic Council’s Eurasia Center, shares his thoughts on the death of Alexey Navalny, the Russian lawyer and anti-corruption activist who became the most potent voice in opposition to President Vladimir Putin. Nate Miles, Head of Retirement at Allspring Global Investments, provides the details of the firm's Retirement Readiness Disconnect report. And we Drive to the Close with Sylvia Jablonski, CEO & CIO at Defiance ETFs.
Hosts: Tim Stenovec and Emily Graffeo. Producer: Paul Brennan. 

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Will US and European leaders decried the death of Russian activist election na Volney, with many placing responsibilities squarely on the Kremlin for the passing of President Vladimir Putin's most prominent domestic political opponent. Navalney was forty seven and was declared dead as official campaigning for the March seventeenth presidential election, in which Putin is likely to secure a fifth term, was set to start. President Biden earlier today from the White House condemned Navalney's death.

Here's what do you have to say? Responsible's death? Putin responsible? We're looking at a whole number of options.

Well, let's get to the interview for more on the implications of the Putin critics death and what it means inside and outside of Russia. We're joined right now by Ariol Cohen, non Resident Senior Fellow at the Atlantic Council's Eurasia Center, also a member of the Council of Foreign Relations. Doctor Cohen joins us from Washington, DC. Doctor Cohen, your reaction when you woke up this morning and you saw that Alexei Navami had died.

I'm extremely saddened, but I cannot say I'm surprised. Putsin decapitated its opposition. Ten years ago he murdered my friend Boris Nemtsov, the other opposition leader, and now alex say after they tried to poison no violently and then miraculously who was saved. He was flown to Germany, saved then, and then he made a brave decision to go back to Russia and to fight for freedom for his ideas. This is a huge blow to the Russian opposition. I compare it with the death of Martin Luther King Junior, the murder of MLK, and imagine for a moment that Nelson Mandela would have been killed in the South African jail. But we won't see mass outpourings of protest in Russia because under Putin, Russia became much more authoritarian, borderline tutalitarian in many respects. It reminds me of late stolid period, not even the Soviet Union of my youth under Lelenid Breshnev.

Doctor Cohen, what kind of clarity do we have right now on what actually happened with the death of Navalny.

Navalni was put in an Arctic jail in the far far North, on the coast of the Arctic Ocean. He was in the most harsh conditions, but he was in a good mood just yesterday when he was interviewed for another case. That the regime was piling against him, and the sudden death, of course, would require an investigation that is not going to happen in Putins Russia. His wife is intending to fly to Russia. That's also an act of bravery. But most of the opposition, as I said, is either exiled or some of the leaders killed. We have Vladimir Karamurza, the columnist for the Washington Post, in the Russian jail sentence to twenty five years after they also tried to poison him twice. And you have hundreds of people in Russia now prisoners of conscious fighters for the freedom of speech and liberty. You can go to many years of jail in Russia today for a Facebook post or a comment or anything that they can interpret as defamation of the Russian.

Military, Doctor Cohen. This comes at a time ahead of President Putin running for re election, yet again widely believed he will win by a large majority, has he has in many elections in the past twenty four years. At this point, I'm wondering what power you think the Russian people have at this point to actually protest or rise up against the regime.

The discussion in Moscow is always about the numbers. The late Boris nempself said, if we bring a million people into the streets, which happened before the collapse of the Soviet Union, they had a million people in the streets, then the regime will be over because the police will be too intimidated a week to try and kill a million people. On the other hand, if it's a thousand people, they can be surrounded, beaten up, taken to jail, et cetera. So it's a matter of numbers. In my opinion, I started in this business about forty years ago in audience research. In my opinion, about sixty percent of the Russian population maybe more support puts in his war in Ukraine. This is of course when you have television totally dominated by Putin and the Kremlin. Imagine if in this country we had CNNABC, Fox, Bloomberg, et cetera, all dominated by one man. So, under those conditions, not unlike Stalin's Soviet Union or Bresion of Soviet Union or for that matter, Hitler's Germany, a majority but not an absolute majority, supports a regime and a pretty significant minority doesn't like it or hates it. And we saw a million people leaving Russia after reinvasion of Ukraine in February twenty two.

How does this further inflame tensions now between Russia and the US.

I think that this murder brings in high relief the nature of the regime of the satellite nuclear weapon that puts In may deploy in space in violation of applicable international treaties. So it is decapitating the opposition. We learn learn about the plans to expand the war after Ukraine, possibly attacking the Baltic States and also deploying the banned weapon in space.

It's something we heard the President asked about a little earlier in the day when he did make those comments from the White House on the death of Alexi Navanni. We also heard him doctor Cohen say Putin is responsible. We're looking at a whole number of options. That's all I'll say right now. Help me understand what options the United States and Europe actually has in retaliating against Putin for this, given that Russia is already under so many sanctions as a result of its invasion of Ukraine.

Russia is under some sanctions, and initially they stung, but now we see the Russian economy is in pretty anonemic growth, but growth nevertheless, maybe about one percent a year, maybe less, but it didn't collapse. So, for example, Russia is exporting LNG liquified natural gas. It's not under sanctions. The exports of LG to France in twenty three grew forty three percent, and at the same time, the Biden administration announced that they're going to block future approvals of LG exporting infrastructure, which scares our European and Asian allies who are the buyers of LERG. Next, Russia is exporting nuclear reactors. Russia is exporting weapons. Russia is still using the international banking system. We actually buy uranium fuel for our nuclear reactors from Russia because successive administrations, Republicans and Democrats abandoned American nuclear industry, so there's a lot we can do. We can reshure and franch ure a lot of industries like titanium that Boeing was buying from Russia. So there's a lot we can do. And there are three hundred billion dollars of Russian money parked in the West. And the big question is at war's point, this money will go for the Ukrainian war effort, especially if Republicans are not allowing financing of the Ukrainian war through the US assistance.

Doctor Cohen, That's exactly where I want to go. Just we have thirty seconds left here, But we did hear President Biden in those comments from the White House tying funding to Ukraine to the death of navalny earlier in his comments thirty seconds Is that going Is that strategy actually going to work?

It depends. All we need now is for Mike John the Speaker to allow the Ukrainian assistance legislation to go to the floor, because on the floor of the House there's a majority of Republicans and Democrats who will vote for assistance. It is President Biden, ex President Bison, and Mike Johnson, who are preventing this assistance to go for the vote, and as a result, thousands of Ukrainians, civilians and soldiers are dying.

Doctor Ariel Cohen is a non resident Senior Fellow at the Atlantic Council's Eurasia Center, also a member of the Council of Foreign Relations. Joining us from Washington, DC this afternoon, Doctor Cohen, really appreciate you taking the time.

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This probably will not surprise me. For younger generations in the US, it's difficult for many of them to imagine the entire Roughly twenty one percent of Americans ages twenty two to thirty four said retirement is out of reach or not part of a plan. This is from a recent TIAA Institute survey, and it's easy to see why good entry level jobs are getting harder to come by. Student debt burdens are daunting, and the cost of living in so many places is high. But what do things look like for older Americans, those people who are closer to retirement, this is something that should perhaps be on your radar since their retirement is coming up much sooner. Day Miles is head of Retirement at all Spring Global Investments. He joins us from Charlotte, North Carolina and Nate. Good to have you on the program. This afternoon. All Spring released the results of a recent survey on retirement this week. Going through the results, one thing that really surprised me was the disconnect between how advisors see their clients versus how the clients see themselves when it comes to being prepared for retirement. There's a big delta there, big gap there. What's going on?

Yeah, I think part of that tim is just a reflection to the fact that a lot of individual investors don't know what they don't know. When we ask some questions around things like their knowledge of social Security, their knowledge of medicare, long term planning, estate planning, what we find is that once they actually leverage an advisor, they tend to be more confident in their own ability to answer those questions, but less confident in their ability to answer them without the help of an advisor. So I think part of what's going on there is that individual investors don't know what they don't know. It's kind of like asking them a one hundred people who's a better than average driver, and you'll get ninety people that say yes. We think that's happening in some of that data as well.

What are some of the economic implications if in this country we have so many people thinking that they're not prepared for retirement.

Yeah.

I think what's interesting in the data is that while we show retirees are better prepared for retirement more secure in the retirement, there really is no discernible difference in the data between the preparedness of near retirees and retirees. The main difference is that one's retired and the other group is still working. We think it's more a matter of the fear of the unknown. Right this idea that I've been thinking about retirement for two, five, ten, fifteen years, it's right around the corner. How do I transition from being a worker that's getting a paycheck every two weeks every month to someone who has to create their own paycheck? And it's a reflection more I believe of the change in focus of near retirees versus retirees a change in focus from one where when I'm working, I'm worried about the value of my portfolio to when I retire, I'm more focused on the income that my portfolio will throw off to fund my family's lifestyle, both today and in the future. So it is a big concern in terms of you know, from a country perspective, Emily, but I think our data doesn't show a huge difference between those near retirees and the retiree population.

I think, Nate.

One thing that I think about a lot is that things change during a career, not just about the job that you have, how much money you make, your family circumstances you need to support, but also what types of products are out there that are available to people to save for retirement, Like the rise of target date funds comes to mind, and the rise of passive index investing comes to mind. How are you seeing that reflected in the surveys, Because for a lot of folks they can just say, Okay, well, I know what year I want to retire. I can throw it all in a target date fund. That will change the older I get in, the closer retirement I get, and then I can forget about it.

Yeah, it's a great question and one of our kind of more interesting findings, I would say, in this year's study, so we found that only seventeen percent of near retirees preferred using target date funds over fifty two percent of investors who are looking to use let's say the core menu to create their own portfolio. And that's a really stark difference, I would say, than the industry's perception of what will likely happen over time. If you look at today's twenty five and thirty five year olds, they tend to leverage targetate funds eighty eighty five ninety percent of the time.

Right.

That's one of the reasons why it's a three trillion dollar marketplace. But as you move towards that retirement age, it drops down substantially. We've always kind of had this view that as people move towards retirement, they would continue allocating towards targeting funds in those same kind of levels of utilization as they get older. This data tends to point to the fact that maybe that's not the case. Maybe people recognize that when they do become fifty five or sixty years old, the differences between them and their colleagues start to matter a lot more. A quick aside on this, if you think about targeting funds, for let's say, at twenty five year old, most of your total wealth is tied up in something called human capital, your future earnings that you're not going to spend and instead you're going to save. And because that's the largest portion of your wealth at that time timeframe, the three of us aren't that different let's say at twenty five or thirty years old. But as time marches on and some of us might get married, have kids, be healthier than the other, expect to retire earlier or later, maybe have a longer, more lavish lifestyle in retirement, all of a sudden, those differences because our human capital starts to decline, matter a lot more.

So.

While target funds have done incredible service, we would say for tens of millions of Americans, I think it's fair to say that they're less optimal person to person at fifty five than they are at age twenty five. And we're starting to see that in the data from our survey. So very interesting finding this year, Nate.

Another interesting finding that I noticed in this survey was just how the already retired respondents talk about whether they made the right decision on timing when when to retire. Thirty seven percent of retired respondents said that they retired sooner than expected. Thirty nine percent said they retired too late. How at all, Spring do you kind of find that balance for potential retirees in your clients.

Yeah, So the main driver of when to retire is really financial. I think that was forty seven percent of the time. That was the kind of key driver. But the qualitative response that we were getting from individual respondents was that trying to balance how much wealth I have or assets I have versus the quality of life that I'm looking for in retirement came up more and more in All Spring Survey this year, really for the first time that I can remember in the seven years that I've been involved in the study, So that that was a new nuance emily that I think we're going to start to see more on a go for a basis In general, I believe it was sixty five percent or sixty nine percent of people were happy, were happier in retirement than they expected, but on average about individuals wanted to work about one year longer than they otherwise did, and so many of them were forced out of the workforce, either for health reasons or reasons beyond their control, a little bit earlier than they had planned.

And hey, we have about a minute left, but I want to go back to something you said about social security and the way that people think about social security. How should soon to be retired folks and people who are early on in their careers think about social security? Is it something that they should actually rely on when it comes to retirement planning or are you do you have the concern that will not be available to the same extent that it is now.

Yeah, I do think they'll probably be means testing, you know, let's say in twenty five or thirty years. I think that's a probable outcome. I think for people that are within ten to fifteen years of retirement, the likelyhoo that they'll see any substantial changes in that regard is pretty deminimus. So I think it's a real risk for people, let's say, in their twenties and thirties today. But the good news is they have the benefit of time. You know, our study focused on people that had more than two hundred thousand dollars in assets, and that's a number that we would expect individuals that are fortunate enough to have an employer sponsor DC planned to well exceed after thirty or forty years of retirement of savings for retirement.

Sorry, Nate, really appreciate you joining us. We're gonna have to leave it there. That's Nate Miles, head of Retirement all Spring Global Investments, joining us from Charlotte, North Carolina.

Brother Mack.

Journal.

How about you let me drive?

Oh no, no, no, no, who's honey?

Please?

I'll do the riding travels. I want to drive.

Question good time.

This is the drive to the Globe dot Com, Think Well ban on Bloomberg Radio.

Well, the S and P five hundred pulling back on those gains, actually ending down now about point five percent and snapping a five week winning streak for the S and P five hundred. But there are still some bulls out there. It's time for drive to the clothes. We're joined with Sylvia Jablonski, CEO and CIO at Defiance ETFs, who joins us on Zoom from New York City. So let's start with your market thoughts. Sylvia, is there still reason to be bullish or have equities just run up too far, too fast, and we're starting to see that risk off shift kind of materialize today.

Well, good afternoon, and thank you for having me today ahead of the long weekend here. I've remained bullish on the markets. You know, I think, you know, sort of two things happen. One is that ce key I number came in a little bit hot. You know, twenty twenty four started much along the lines of twenty twenty three D It was sort of you know, good year. Markets are up out of the gates, give or take a week, and then you know, you had a little bit of a reset in between. Markets rallied again, and then the CPI number came in a little bit hot. We saw the markets sort of recover from that as the retail sales number came in a little bit lighter. And then you know, here we are again on the next inflation read and the markets are pulling back a little bit. But I think this is all just you know, kind of short term part for the course on our way to the Fed's inflation number. I think that holy we're in a situation where inflation is going down, the economy remains on trend. You know, the economy is essentially growing and strong. Jobs numbers are good, wages are good, earnings are good. Even though the bar was low, you know, we had great beats kind of across the board there. So I think that you know, Mark, February, March had to be kind of like slower months. Anyway, we're getting a pullback from the from the rips, and I think that they're just good opportunities to actually buy, and you know, right out the end of the year, which should be positive.

What do you consider an opportunity to buy at this point, Sylvia? I mean, is an opportunity like obviously Tuesday in hindsight, was a good opportunity to buy, But how many of those are going to be out there at this point?

You know, every time you think that they've gone away, they come back. So I do think that when you get those days and you know, if you've been sitting on the sidelines, as we know, there's brillions of dollars of cash that is just kind of sitting on the sidelines there, sitting these four to five percent treasures, which is, you know, awesome, But if you think about what's supposed to happen later in the year, the FED is going to cut rates, you know, we can sort of argue about whether that'll be four times or three times or two times, but we're going to get there, and the FED is going to cut rates, and so you know, names, names like you know, small cap stocks for example, will benefit later in the year. Perhaps they won't work right now for investors, but if you you know, kind of goll our cross average your way in, you'll get performance towards the end of the year. And then you know, the Magnificent seven twenty two was a bear market. Last year was recovery, and I think now between AI, you know, quantum computer, super competing, these names are placed to just grow and they're very even though they've been you know, kind of perfectly fine with rates being high over the last couple of years. The minute that rates get cut, you know, they are arguably in a better spot to continue to grow and thrive and really you know, kind of benefit from the AI trend. So mag seven and then some of the unfavored you know, small caps, those parts of the markets.

We've seen over the last few weeks, Sylvia, the market slowly start to walk back its expectations for just how many cuts we're going to have in twenty twenty four. But stocks seem to be okay with that. We're moving more in line with the FEDS projections of how many rate cuts we'll get, which is likely seventy five basis points. But at what point is this not good for the equity market? If the market, you know, begins to price and them will only see one cut for twenty twenty four, is that going to be the moment where we do start to see stocks fall under pressure.

Yeah, that's a great point. So we saw stocks fall under pressure when we saw the CPI read, right, So that tells you that the market still does have this knee jerk reaction to the idea that the FED won't cut as much as as you know, perhaps the market anticipates. So I think, you know, if we get in that realm of three to four cuts, I think everything will sort of be just fine. Maybe you have some bumps in the road if we get some reads that we don't like along the way, you know, if it's sort of not linear between now and May or June, you might see some pullbacks. But I think that overall, you know, we probably are on course to have some sort of cuts this year, and as long as that happens. I think, you know, it's kind of off to the races, or at least, you know, a decent eight to ten percent kind of that annualized S and P five hundred average that we see. If, however, to your point, we get one cut, we get no cuts, then I you know, I think the year ends up kind of being a last year and you you end up seeing your profits kind of twenty twenty five after the election year.

What's the biggest risk out there that you see in the near future. I want to bring up a note that came out earlier today. Bank of America's strategists are saying that bubble highs right now have seen dafter valuations, arguing that there are a host of similarities between tech stocks now in previous bubbles, suggesting that the Magnificent seven is nearing, but not yet at levels that may lead to a pop. That's according to Bank of America analysts. What do you make of that?

Yeah, so I think you know, if you look at the mag seven and you look at valuations, actually, interestingly enough, they many of them actually have come down.

Right.

So, Amazon has this historical average of one eighteen or so, it's in the forties. Now the videos has come down. So what's happening is that these companies are actually earning and they're coming out with sellar earnings. They're cost cutting there becoming more profitable. So I think that so far they're justifying their valuation, you know, in terms of where that goes in the future has to be you know, remains to be seen. I think they have to keep up with the earnings growth, and they have to keep up with kind of producing on all of the quarterly earnings calls and things like this. But for me, I think, you know, what's what's the biggest risk to the market. You know, the biggest thing, obviously, I think would be inflation just going the wrong way and surprising us. And I don't think what we saw so far this week is just is terrible. They're they're kind of light misses. And then the second thing would be geopolitics. Right There's there's a whole lot going on in the world right now, whether it's the Middle East, whether it's Russian and Ukraine. You know a lot of trading tensions and things like this. So those aren't things that we really factioned.

In which geopolitics risk do you think is the biggest.

Oh hard to say. I think that. I think that's you know, what's going on in the Middle East could could potentially, you know, go go in a bad way beyond where we're at now. So I think that, you know, kind of all eyes are there and and you know what happens.

So, Tim, I just went to the ETF Exchange conference. Oh you did.

That's right, that's you did.

I think Sylvia was there too.

I was there.

You are lucky.

We are just dying to talk about ets.

Go ahead, let us go, Sylvia.

What were your I guess key takeaways from that conference? You know over it defines you guys have a lineup of thematic ETFs. Did you notice that people, investors, advisors were fired up about you know, that sector or what was there other I guess areas of ETF innovation that you noticed at the conference?

Yes, So this is so interesting. I was actually talking to a colleague about this before a couple of years ago. No matter what conference you went to, there's a big focus on you know, ETF set track Asia or the Asian region, or you know tech in Asia, or or consumer discrectionary in Asia or retail or you know, just just kind of the whole region in general, and then potentially India would have been second on that list, and this expansion to em and develop markets and a lot of the talk about bitcoin had gone away other than you know, guessing whether or not that ETF would be approved. And I think this year there were three things. One is ETFs that have options on them, that have these you know, enhanced income types of plays. I think there's so much interest out there. We've seen billions of inflows into that space. Thematics in terms of that, it's very much consistent with the market. So all of the flows have gone into the magnificent seven stocks, and so then all of the flows have gone into I think the tech related ETFs that actually capture AI and quanta like our QUANTUMYTF had its best year ever basically because it tracks AI and machine learning. And then the third thing is is bitcoin right that approval and just so many conversations about who's going to win, why and whatnot, So that was super interesting. I think, you know, risk on sentiment is higher than it was a year or two ago for sure at the conference, but definitely yeah, definitely more interested in these creative income options related products and AI and you know things things along that path.

It definitely felt like every fund issuer booth I walked up to wanted to talk to me about their options overlay strategy income kind of ETF. But Sylvia, I do want to ask you about one of Defiant's largest ETFs, the Next Gen Connectivity ETF. It has over five hundred and eighty million dollars in assets, it's up five percent year to date. Why has that theme taken off this year? Do you think?

Yes?

I think so.

So five G and quantum are really are are our AI place. So with quantum you get the supercomputing, the processing of the data, the artificial intelligence aspect of it, the machine learning aspect of it. And with five G, five G is basically the connectivity required for all of these things to happen. So essentially you need to have five G for smart cars to work, for you know, smart cities to be connected in order for the data to be processed in a you know, in an efficient way with lower latency so that you can get to the super efficient AI results. So that's why I think it's taking off this year.

Hey Sylvia, Happy Friday. Glad you guys got to hang out in Miami over the past.

Yes, we both looked a little tan, even though the radio audience can hear it.

That's Sylvia Dablonski, CEO and CIO at Defiance ETFs joining us from New York City.

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