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This is Bloomberg Business Week, Insight from the reporters and editors that bring you America's most trusted business magazine, plus global business, finance and tech news. The Bloomberg Business Week Podcast with Carol Masser and Tim Stenoveek on Bloomberg Radio.

This is Bloomberg Business Week, Insight from the reporters and editors that bring you America's most trusted business magazine, plus global business, finance and tech news. The Bloomberg Business Week Podcast with Carol Masser and Tim Stenoveek on Bloomberg Radio.

We start with what some described as a version of President Trump's stump speech on the campaign trail, or perhaps at a political rally, this time around the President appearing virtually before world leaders. This was at the World Economic Forum's annual meeting in Davos earlier today. Donald Trump did take Q and A. He started with a statement, and I'll here's just what he said. He said, My administration is acting with unprecedented speed to fix the disaster we've inherited from a totally inept group of people, and to solve every single crisis facing our country. This begins with confronting the economic chaos caused by the failed policies of the last administration. Again, these were President Trump's words before he started taking Q and A from a group of global world leaders, including BMA CEO Brian moynihan, talking about inflation, interest rates, energy, call AI, geopolitics.

We start with what some described as a version of President Trump's stump speech on the campaign trail, or perhaps at a political rally, this time around the President appearing virtually before world leaders. This was at the World Economic Forum's annual meeting in Davos earlier today. Donald Trump did take Q and A. He started with a statement, and I'll here's just what he said. He said, My administration is acting with unprecedented speed to fix the disaster we've inherited from a totally inept group of people, and to solve every single crisis facing our country. This begins with confronting the economic chaos caused by the failed policies of the last administration. Again, these were President Trump's words before he started taking Q and A from a group of global world leaders, including BMA CEO Brian moynihan, talking about inflation, interest rates, energy, call AI, geopolitics.

And so much more. There was a lot that he covered.

And so much more. There was a lot that he covered.

Tim with what we need to know and more, We head to the Bloomberg News Washington bureau with the Bloomberg News Managing editor for US Economy and Government, Mario Parker. Mario, We've got a lot to get to, starting though, with something that happened after the President spoke to that group in Davos. A federal judge temporarily blocking President Donald Trump from restricting who is eligible for automatic US citizenship at birth. It's an early legal setback for the new administration's hardline immigration agenda. It's one of a handful of lawsuits already over the order. What does this say about the president's executive actions and the life that these may have or not have when it comes to changing the rules.

Tim with what we need to know and more, We head to the Bloomberg News Washington bureau with the Bloomberg News Managing editor for US Economy and Government, Mario Parker. Mario, We've got a lot to get to, starting though, with something that happened after the President spoke to that group in Davos. A federal judge temporarily blocking President Donald Trump from restricting who is eligible for automatic US citizenship at birth. It's an early legal setback for the new administration's hardline immigration agenda. It's one of a handful of lawsuits already over the order. What does this say about the president's executive actions and the life that these may have or not have when it comes to changing the rules.

Well, I mean this was a sweeping executive order. They raised questions when he issued it because it flies in the face of what the thinking, the long held thinking had been around the Fourteenth Amendment and birthrights. Citizenship something that had long been held as a right.

Well, I mean this was a sweeping executive order. They raised questions when he issued it because it flies in the face of what the thinking, the long held thinking had been around the Fourteenth Amendment and birthrights. Citizenship something that had long been held as a right.

And just.

And just.

A part of the country's founding. So not sure this is surprising, but it is a setback. Right in a week that Trump has taken for pageantry to essentially celebrate his return back to the White House. This amounts to the first speed bump and test of the sweeping power and the agenda that he plans to enact.

A part of the country's founding. So not sure this is surprising, but it is a setback. Right in a week that Trump has taken for pageantry to essentially celebrate his return back to the White House. This amounts to the first speed bump and test of the sweeping power and the agenda that he plans to enact.

Right, and Maro speaks to something that we were kind of all saying once he got elected that there are things that a president can do with executive actions and orders, and then there are things that you know, kind of the US system kicks in and reminds us that it's not always so easy, or in other instances, you know you need something like Congress to make it all happen. Hey, I want to get to the President's had a very busy first week, all right. He spoke with Sean Hannity of Fox News last night, A friendly audience, if you will, for the president. He addressed world leaders in Davos virtually, and I think some of the feedback was kind of mixed views. A lot though, say, what we are hearing from the president is reminiscent of what we heard from him on the campaign trail. What those stands out for you? What do you think should stand out for the Bloomberg audience.

Right, and Maro speaks to something that we were kind of all saying once he got elected that there are things that a president can do with executive actions and orders, and then there are things that you know, kind of the US system kicks in and reminds us that it's not always so easy, or in other instances, you know you need something like Congress to make it all happen. Hey, I want to get to the President's had a very busy first week, all right. He spoke with Sean Hannity of Fox News last night, A friendly audience, if you will, for the president. He addressed world leaders in Davos virtually, and I think some of the feedback was kind of mixed views. A lot though, say, what we are hearing from the president is reminiscent of what we heard from him on the campaign trail. What those stands out for you? What do you think should stand out for the Bloomberg audience.

Well, I think one of the things that stands out Other than the fact that he did deliver in a World Economic forum, a stage, he did deliver a campaign speech. I think a couple of things it stood out right was a the broadside to Bank of America CEO Brian moynihan. Again, that was very reminiscent of a Trump rally where he calls out those that he is displeased with. So that was one thing that was quite striking, and from what we understand from our colleagues, they're an audience that drew surprise and gasps. The other, I think from a business standpoint, is the fact that he seems to be intent on pressuring Opek Saudi Arabia, namely to lower the price of crude oil and gasoline even amid a market glut, because he wants to essentially bring down inflation and all those things, which leads the third part that we saw from today. He reiterated his stands that inflation he feels is too high, but also interest rates he can do nothing about that, even though he said he would demand that interest rates come down. But it did signal that Jay Powell is probably in for a rough ride here.

Well, I think one of the things that stands out Other than the fact that he did deliver in a World Economic forum, a stage, he did deliver a campaign speech. I think a couple of things it stood out right was a the broadside to Bank of America CEO Brian moynihan. Again, that was very reminiscent of a Trump rally where he calls out those that he is displeased with. So that was one thing that was quite striking, and from what we understand from our colleagues, they're an audience that drew surprise and gasps. The other, I think from a business standpoint, is the fact that he seems to be intent on pressuring Opek Saudi Arabia, namely to lower the price of crude oil and gasoline even amid a market glut, because he wants to essentially bring down inflation and all those things, which leads the third part that we saw from today. He reiterated his stands that inflation he feels is too high, but also interest rates he can do nothing about that, even though he said he would demand that interest rates come down. But it did signal that Jay Powell is probably in for a rough ride here.

You mentioned that broadside against Bank of America. What he ended up doing was chatting Brian Wynihan and catching him off guard with the claim that the bank limits business with conservative clients. He said, I hope you start opening your bank to conservatives, because what you were doing is wrong. Bank of America came out and said, quote, we serve more than seventy million clients, We welcome conservatives and have no political litmus test. That's what a representative for Bank of America said an email statement to Bloomberg we.

You mentioned that broadside against Bank of America. What he ended up doing was chatting Brian Wynihan and catching him off guard with the claim that the bank limits business with conservative clients. He said, I hope you start opening your bank to conservatives, because what you were doing is wrong. Bank of America came out and said, quote, we serve more than seventy million clients, We welcome conservatives and have no political litmus test. That's what a representative for Bank of America said an email statement to Bloomberg we.

Should point out to the president also called out Jamie Diamond, CEO of JP Morgan Chase for the same alleged treatment of conservative customers, and they put out a statement to saying we have never would never close an account for political reasons, full stop. Having said that, what's kind of interesting, and you know, Maria, we've been doing a lot of reporting here at Bloomberg about, you know, kind of leadership around the world, certainly at least in the United States, where we see CEOs seemingly that maybe weren't necessarily supporters of President Trump, you know, showing up in Washington, showing up in the inauguration. It is interesting to see kind of the corporate support so far that he has gotten and some of the deals, whether it's around AI bringing leaders together for different spends.

Should point out to the president also called out Jamie Diamond, CEO of JP Morgan Chase for the same alleged treatment of conservative customers, and they put out a statement to saying we have never would never close an account for political reasons, full stop. Having said that, what's kind of interesting, and you know, Maria, we've been doing a lot of reporting here at Bloomberg about, you know, kind of leadership around the world, certainly at least in the United States, where we see CEOs seemingly that maybe weren't necessarily supporters of President Trump, you know, showing up in Washington, showing up in the inauguration. It is interesting to see kind of the corporate support so far that he has gotten and some of the deals, whether it's around AI bringing leaders together for different spends.

But again it's early days.

But again it's early days.

Yeah, it is early days, and it has been striking, especially if you recall the scenario about eight years ago. It's a couple of things to point out there, right. The fact is, if you saw his speech earlier today at Davos, within the first few minutes, he mentioned this sweeping mandate that he feels like he has. He won all of the swing states, he won the popular vote. He invoked that as well last night in the Sean Hannity interview as well.

Yeah, it is early days, and it has been striking, especially if you recall the scenario about eight years ago. It's a couple of things to point out there, right. The fact is, if you saw his speech earlier today at Davos, within the first few minutes, he mentioned this sweeping mandate that he feels like he has. He won all of the swing states, he won the popular vote. He invoked that as well last night in the Sean Hannity interview as well.

What you're saying.

What you're saying.

Here, the response from Corporate America and others as well, is the fact that in twenty sixteen you couldn't say that, Okay, well, he won the electoral college. If you all recall post election, there was discussion about whether or not the electoral college should be revised in some way. Well, it's hard to argue when he won the popular vote and the swing states the electoral college. Right, these are by and large the customers of these corporations. This does show or signal to corporations and political parties alike that maybe his support is much stronger than was anticipated, both on a campaign trail in twenty twenty four, but obviously since twenty sixteen.

Here, the response from Corporate America and others as well, is the fact that in twenty sixteen you couldn't say that, Okay, well, he won the electoral college. If you all recall post election, there was discussion about whether or not the electoral college should be revised in some way. Well, it's hard to argue when he won the popular vote and the swing states the electoral college. Right, these are by and large the customers of these corporations. This does show or signal to corporations and political parties alike that maybe his support is much stronger than was anticipated, both on a campaign trail in twenty twenty four, but obviously since twenty sixteen.

That's a really good point. Hey, I just want to sort of head to wrap things up with what he said about Russia and Ukraine and bringing that war to an end. He said he wants to meet again with Russian President Vladimir Putin. He talked a lot about not necessarily making the economic or business case for ending the war, but the lives that have been lost and the lives that are at risk during a conflict such as this. What power does the president of the United States have to help end this war?

That's a really good point. Hey, I just want to sort of head to wrap things up with what he said about Russia and Ukraine and bringing that war to an end. He said he wants to meet again with Russian President Vladimir Putin. He talked a lot about not necessarily making the economic or business case for ending the war, but the lives that have been lost and the lives that are at risk during a conflict such as this. What power does the president of the United States have to help end this war?

Well, he does have power in that regard, at least his thoughts to right, the United States has been one of the biggest benefactors of Ukraine, right, one of the supporters of Ukraine throughout this all, we know that Donald Trump, at least he says that he's had a good relationship with Putin in the past. Zelensky he met with just shortly after he was elected as well. And then he's making the case that natural gas prices are tied to this, energy independence has tied to this, and sanctions and tears have a role in this as well.

Well, he does have power in that regard, at least his thoughts to right, the United States has been one of the biggest benefactors of Ukraine, right, one of the supporters of Ukraine throughout this all, we know that Donald Trump, at least he says that he's had a good relationship with Putin in the past. Zelensky he met with just shortly after he was elected as well. And then he's making the case that natural gas prices are tied to this, energy independence has tied to this, and sanctions and tears have a role in this as well.

Well, and we're going to talk a little bit later on in this hour about energy in particular, because the president can certainly set policies, but then you have the economic dynamics of drilling more and what that means for energy companies. So it's something we're going to dig into a little bit deeper. Mariol, thank you so much. We know it's a busy day for you and the team, but glad we could get some time with you. Bloomberg News Managing Editor for US Economy and Government, Maria Parker.

Well, and we're going to talk a little bit later on in this hour about energy in particular, because the president can certainly set policies, but then you have the economic dynamics of drilling more and what that means for energy companies. So it's something we're going to dig into a little bit deeper. Mariol, thank you so much. We know it's a busy day for you and the team, but glad we could get some time with you. Bloomberg News Managing Editor for US Economy and Government, Maria Parker.

There in DC.

There in DC.

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Oil did fall after President Donald Trump that he'll push Saudi Arabian OPEK to reduce the price of crude, reviving a tactic to control energy prices that he frequently used during his first term in office. The Organization of the Petroleum Exporting Countries OPEK, course and it's allies though, have been, as you know, engaging in a year's long effort to support prices by curbing.

Oil did fall after President Donald Trump that he'll push Saudi Arabian OPEK to reduce the price of crude, reviving a tactic to control energy prices that he frequently used during his first term in office. The Organization of the Petroleum Exporting Countries OPEK, course and it's allies though, have been, as you know, engaging in a year's long effort to support prices by curbing.

Output energy certainly one area that our next guest suggests investors should consider. Let's get to Jason Bottenfield. He's managing director and partner at Park Cities Group at Stewart Partners, joining us from Dallas, Texas. Good to have you with us, Jason. We did just spend a good portion of the last twenty minutes chatting about energy. You believe it's something investors should be investing in. Why now and where specifically?

Output energy certainly one area that our next guest suggests investors should consider. Let's get to Jason Bottenfield. He's managing director and partner at Park Cities Group at Stewart Partners, joining us from Dallas, Texas. Good to have you with us, Jason. We did just spend a good portion of the last twenty minutes chatting about energy. You believe it's something investors should be investing in. Why now and where specifically?

Yeah, no, thanks for having me, Tim and Carroll. I appreciate the opportunity. Yeah, oil, and I was listening to tie On on the conversation there about oil and the ups and downs.

Yeah, no, thanks for having me, Tim and Carroll. I appreciate the opportunity. Yeah, oil, and I was listening to tie On on the conversation there about oil and the ups and downs.

It's good.

It's good.

It's been a good area to be in for the first start of this year here.

It's been a good area to be in for the first start of this year here.

You know, one of the things I like about what's going to happen with oil, you know, outside of the fact that we are producing a lot of it already, but one of the areas that I think is very attractive at this point in time is the transmission of it. So moving it through the pipelines, whether it's the now natural gas or the oil. You know, it's it's it's a dividend play. It pays out pretty well, but it can be volatile, and it is up a little bit this year, pretty eight nine percent. But I think it's an opportunity that will continue over the next four years. I think because of what Ty was saying, you know, potentially on one angle he was going with, which is regulations are going to be a little less.

You know, one of the things I like about what's going to happen with oil, you know, outside of the fact that we are producing a lot of it already, but one of the areas that I think is very attractive at this point in time is the transmission of it. So moving it through the pipelines, whether it's the now natural gas or the oil. You know, it's it's it's a dividend play. It pays out pretty well, but it can be volatile, and it is up a little bit this year, pretty eight nine percent. But I think it's an opportunity that will continue over the next four years. I think because of what Ty was saying, you know, potentially on one angle he was going with, which is regulations are going to be a little less.

So that's an opportunity I think.

So that's an opportunity I think.

I think it's an area that people have looked at over the years, but it might be another one to look at again.

I think it's an area that people have looked at over the years, but it might be another one to look at again.

But they so the major integrated oil companies, the drillers, what exactly would you would you buy?

But they so the major integrated oil companies, the drillers, what exactly would you would you buy?

So I would actually be looking at the midstream players, which are the pipelines. Okay, so actually the big refineries, I think because the price of oil as they as we're talking about could go down to sixty five dollars a barrow and they still make money, but that could be a weight on the stock if you actually go into those and the price does come lower, if they produce more OAPEX producing more, if they're all if there's just a glood of oil out there and the consumption doesn't meet up. But again, I think regulation's coming off on electric vehicles just adds to that story. That you know, the oil is going to be flowing, the exports are going to continue to flow, There's not going to be the impacts there. So I think that transmission of the actual product is the area that I'm talking about.

So I would actually be looking at the midstream players, which are the pipelines. Okay, so actually the big refineries, I think because the price of oil as they as we're talking about could go down to sixty five dollars a barrow and they still make money, but that could be a weight on the stock if you actually go into those and the price does come lower, if they produce more OAPEX producing more, if they're all if there's just a glood of oil out there and the consumption doesn't meet up. But again, I think regulation's coming off on electric vehicles just adds to that story. That you know, the oil is going to be flowing, the exports are going to continue to flow, There's not going to be the impacts there. So I think that transmission of the actual product is the area that I'm talking about.

With those midstreams, it looks attractive to me.

With those midstreams, it looks attractive to me.

So you mean like Shanier and Williams companies things.

So you mean like Shanier and Williams companies things.

Like that, Yeah, those types of companies where they're traditionally moving you know, the natural gas or they're moving the oil through those lines and you know, moving them out out and exporting them. So you know that's those are the areas exactly.

Like that, Yeah, those types of companies where they're traditionally moving you know, the natural gas or they're moving the oil through those lines and you know, moving them out out and exporting them. So you know that's those are the areas exactly.

But somebody watching or listening right now might be saying to themselves, Hey, what happens at the oil price declines? How are these pipelines affected. Just give us an idea of what happens when the trans to the transmission and to hear the economics there. If we do see a decline in energy prices.

But somebody watching or listening right now might be saying to themselves, Hey, what happens at the oil price declines? How are these pipelines affected. Just give us an idea of what happens when the trans to the transmission and to hear the economics there. If we do see a decline in energy prices.

Yeah, there's there's a natural you know, because it is they are tied a little bit. So you know, I wouldn't say it's one for one when oil goes down that the pipelines go down, but they do trade with that, so you know, where oil is down a little bit today. The pipelines are down a little bit today, But again I think it really is that oil flowing is oil flowing. So they get paid almost like electric companies, as the stuff moves through it.

Yeah, there's there's a natural you know, because it is they are tied a little bit. So you know, I wouldn't say it's one for one when oil goes down that the pipelines go down, but they do trade with that, so you know, where oil is down a little bit today. The pipelines are down a little bit today, But again I think it really is that oil flowing is oil flowing. So they get paid almost like electric companies, as the stuff moves through it.

So you know, they just want to keep it moving.

So you know, they just want to keep it moving.

And as long as people are the consumptions there, the need is there, and they're allowed to move it through and we're producing it, you know, they are the ones that are going to benefit from that and the export that goes along with it. So I think that we've all seen that Trump's not going to put a many regulations.

And as long as people are the consumptions there, the need is there, and they're allowed to move it through and we're producing it, you know, they are the ones that are going to benefit from that and the export that goes along with it. So I think that we've all seen that Trump's not going to put a many regulations.

On that, right, and he's not going to put much on the industries.

On that, right, and he's not going to put much on the industries.

Economic weakness US or global that certainly would impact pipelines, right, they wouldn't have as much stuff to kind of move around.

Economic weakness US or global that certainly would impact pipelines, right, they wouldn't have as much stuff to kind of move around.

Yeah, you know, these are not for the faint of heart. I think you do need to do some research on these. You know, there's been you know, years and twenty fifteen and things like that where they get touched up, and especially you know, during recessionary periods. But I think where we're coming off of kind of a two year bowl market maybe going into the third, things are looking promising right now. I think it's just a it's an area to where you can pick up some yield, and you know, it's it's not a conservative play by any means, but I don't think it's an ultra risky play at this point.

Yeah, you know, these are not for the faint of heart. I think you do need to do some research on these. You know, there's been you know, years and twenty fifteen and things like that where they get touched up, and especially you know, during recessionary periods. But I think where we're coming off of kind of a two year bowl market maybe going into the third, things are looking promising right now. I think it's just a it's an area to where you can pick up some yield, and you know, it's it's not a conservative play by any means, but I don't think it's an ultra risky play at this point.

We're also interested in cybersecurity, specifically with regard to AI. We've had a lot of folks coming on our air lately and talking about the risk of cybersecurity and in fact other ways to find exposure to this space through insurance and other providers of services. How do you see finding exposure for your clients.

We're also interested in cybersecurity, specifically with regard to AI. We've had a lot of folks coming on our air lately and talking about the risk of cybersecurity and in fact other ways to find exposure to this space through insurance and other providers of services. How do you see finding exposure for your clients.

Yeah, so cybersecurity is one of those things.

Yeah, so cybersecurity is one of those things.

Right when I think about it is that it's going to be the last area for companies to cut or smaller companies that don't have cybersecurity teams are going to need these outside services. So you know, attacking that area through an ETF where I don't have to be as specific as going into an individual stock name, you know, can be beneficial because you know, there were some touch ups last year with a certain company in that space and it went down, but it was actually a buying opportunity. But to avoid some of that exposure of the business risk, you know, exchange traded funds are a great opportunity.

Right when I think about it is that it's going to be the last area for companies to cut or smaller companies that don't have cybersecurity teams are going to need these outside services. So you know, attacking that area through an ETF where I don't have to be as specific as going into an individual stock name, you know, can be beneficial because you know, there were some touch ups last year with a certain company in that space and it went down, but it was actually a buying opportunity. But to avoid some of that exposure of the business risk, you know, exchange traded funds are a great opportunity.

To get that exposure.

To get that exposure.

It's a little bit more across the board, and some people may want to pick direct plays, but I like to go and go into that market with exchange trade of funds because I do get that kind of broader exposure to that industry. So that's how I play it with clients and myself.

It's a little bit more across the board, and some people may want to pick direct plays, but I like to go and go into that market with exchange trade of funds because I do get that kind of broader exposure to that industry. So that's how I play it with clients and myself.

Jason, One thing I want to ask you, We certainly ask it of all the kind of big global strategists that we talked to, the dynamics that they are using to shape investment portfolio.

Jason, One thing I want to ask you, We certainly ask it of all the kind of big global strategists that we talked to, the dynamics that they are using to shape investment portfolio.

And I understand every client is an individual. I get it, I get it, I get it.

And I understand every client is an individual. I get it, I get it, I get it.

But having said that, there are big metrics that shape kind of maybe where you steer someone, even if it's putting new money to work.

But having said that, there are big metrics that shape kind of maybe where you steer someone, even if it's putting new money to work.

And so what are those dynamics?

And so what are those dynamics?

Is it what we get out of the White House, what we hear from President Trump? What actually happens in terms of policy? Is it the FED, the first meeting of twenty twenty five happening, happening next week?

Is it what we get out of the White House, what we hear from President Trump? What actually happens in terms of policy? Is it the FED, the first meeting of twenty twenty five happening, happening next week?

Is it earnings?

Is it earnings?

Where we are in that earning season, We're going to get some big tech names next week?

Where we are in that earning season, We're going to get some big tech names next week?

Is it valuations? What is it that right now?

Is it valuations? What is it that right now?

Is really driving how you are helping clients shape where they make investments.

Is really driving how you are helping clients shape where they make investments.

Yeah, no, it's a great question.

Yeah, no, it's a great question.

It's one that comes up often, you know, as we're on the ground talking to clients and what they're feeling and what they're being impacted by, and you know, unfortunately the story goes back to inflation. It's the biggest thing. I think a lot of our individual clients don't think of it that much. They do look at kind of the more scintillating news facts that come out, whether it's elections or policies or regulations or what's going on, but it really isn't It really is the inflation picture because we're really at you know, a lot of freezing going on across the country in some areas. I really think that we're on thin ice with the Fed and the economy. You know, they had pretty good direction on where they could go with cutting rates. I think they may have one cut left as far as with the two years showing you're seeing the tenure and the two year move around. The two year I think allows them to have one more cut, but after that it's probably going to be a pause unless the Fed really sees that the job market isn't continuing heating up. You know, I've been saying for two years I thought that the job market needed Unfortunately, I think the Fed's looking for unemployment for them to have another basis to move lower, you know, can they do the soft landing and be where they're at? So I think a long winded answer many, like many of your guests may be, is that inflation is still going to be a picture in twenty twenty five. And I was hoping, really hoping that coming into this year that would be off the table and we would be talking more about more of the fundamentals of earnings, more about maybe what's going on with regulations are unfreezing.

It's one that comes up often, you know, as we're on the ground talking to clients and what they're feeling and what they're being impacted by, and you know, unfortunately the story goes back to inflation. It's the biggest thing. I think a lot of our individual clients don't think of it that much. They do look at kind of the more scintillating news facts that come out, whether it's elections or policies or regulations or what's going on, but it really isn't It really is the inflation picture because we're really at you know, a lot of freezing going on across the country in some areas. I really think that we're on thin ice with the Fed and the economy. You know, they had pretty good direction on where they could go with cutting rates. I think they may have one cut left as far as with the two years showing you're seeing the tenure and the two year move around. The two year I think allows them to have one more cut, but after that it's probably going to be a pause unless the Fed really sees that the job market isn't continuing heating up. You know, I've been saying for two years I thought that the job market needed Unfortunately, I think the Fed's looking for unemployment for them to have another basis to move lower, you know, can they do the soft landing and be where they're at? So I think a long winded answer many, like many of your guests may be, is that inflation is still going to be a picture in twenty twenty five. And I was hoping, really hoping that coming into this year that would be off the table and we would be talking more about more of the fundamentals of earnings, more about maybe what's going on with regulations are unfreezing.

But it really is, inflation is still on the table. Unfortunately.

But it really is, inflation is still on the table. Unfortunately.

All right, gold to leave it on that note, Hey, Jason, thank you so much. Jason Botten failed He is Managing director Park Cities Group at Stewart Partner's joining us from Dallas, Texas on this Thursday.

All right, gold to leave it on that note, Hey, Jason, thank you so much. Jason Botten failed He is Managing director Park Cities Group at Stewart Partner's joining us from Dallas, Texas on this Thursday.

AI in Jobs, carolationship and what it looks like going forward. We talk about it all the time.

AI in Jobs, carolationship and what it looks like going forward. We talk about it all the time.

We do a lot and trying to make sense. Is it going to be complementary, helpful, more productive, or is it going to take our jobs.

We do a lot and trying to make sense. Is it going to be complementary, helpful, more productive, or is it going to take our jobs.

Okay, well, speaking of that, Earlier this month, the team over at Bloomberg Intelligence put out a report that said global banks will cut as many as two hundred thousand jobs in the next three to five years as AI encroaches on tasks currently carried out by human workers. Needless to say, workers are trying to figure out their place in the world of AI, and economists and behaviorists have their work cut out for them.

Okay, well, speaking of that, Earlier this month, the team over at Bloomberg Intelligence put out a report that said global banks will cut as many as two hundred thousand jobs in the next three to five years as AI encroaches on tasks currently carried out by human workers. Needless to say, workers are trying to figure out their place in the world of AI, and economists and behaviorists have their work cut out for them.

Yeah.

Yeah.

One of them working on that is Kelly Monahan. She's an organizational behaviorist who is managing director of the Upwork Research Institute. That's the research arm of the platform Upwork, which matches talent with company. She joins us right now from Orlando, Florida. Nice to have you back with us, Kelly.

One of them working on that is Kelly Monahan. She's an organizational behaviorist who is managing director of the Upwork Research Institute. That's the research arm of the platform Upwork, which matches talent with company. She joins us right now from Orlando, Florida. Nice to have you back with us, Kelly.

How are you.

How are you.

I'm doing great. Sreat to see you guys again.

I'm doing great. Sreat to see you guys again.

Yeah, it's great to see you as well. How are you thinking about AI and the relationship with how we work and what it means for.

Yeah, it's great to see you as well. How are you thinking about AI and the relationship with how we work and what it means for.

Jobs that might be replaced in new jobs that might be created.

Jobs that might be replaced in new jobs that might be created.

Yeah, Upwork, We're seeing this fascinating demand curve happen. So if we look it back in November twenty twenty two, when chatchpt I think took the world by a storm. What we saw happening within our labor market at upwork was these general searches so prompt engineering.

Yeah, Upwork, We're seeing this fascinating demand curve happen. So if we look it back in November twenty twenty two, when chatchpt I think took the world by a storm. What we saw happening within our labor market at upwork was these general searches so prompt engineering.

CHET GPT, generative AI.

CHET GPT, generative AI.

If I'm going to be honest, I don't think many business leaders quite even understood what they were asking for.

If I'm going to be honest, I don't think many business leaders quite even understood what they were asking for.

Fast forward to where we are today.

Fast forward to where we are today.

Early twenty twenty five, we see a much more mature market happening on our platform. And what that it's meaning from a job task perspective is that freelancers today are having to become much more specialized. We realize generative AI is actually all about the data data quality in the back end and then being able to visualize on the front end so leaders can actually do something with it. And so as a result of that, we're seeing much more specialized demand take place on our platform today.

Early twenty twenty five, we see a much more mature market happening on our platform. And what that it's meaning from a job task perspective is that freelancers today are having to become much more specialized. We realize generative AI is actually all about the data data quality in the back end and then being able to visualize on the front end so leaders can actually do something with it. And so as a result of that, we're seeing much more specialized demand take place on our platform today.

Okay, so how do freelancers do that? What's the best way for them to make themselves I don't want to say immune, but adjust to this new world. How do they become more specialized?

Okay, so how do freelancers do that? What's the best way for them to make themselves I don't want to say immune, but adjust to this new world. How do they become more specialized?

Yeah, that's a great question.

Yeah, that's a great question.

So what we see happening, Let's take machine learning as an example. That's always been a category on our platform for the last several years, but what freelancers are doing is becoming more specialized with that and adapting to the new tool of generative AI and beginning to develop those skill sets of data annotation, data relabeling as examples, or knowledge representation we see growing on our platform, which simply means being able to make patterns and sense of the data within their organization. And so freelancers, I think what you see is those that are traditionally trained in data science machine learning are really adapting and evolving and understanding what does that mean in light of generative AI and.

So what we see happening, Let's take machine learning as an example. That's always been a category on our platform for the last several years, but what freelancers are doing is becoming more specialized with that and adapting to the new tool of generative AI and beginning to develop those skill sets of data annotation, data relabeling as examples, or knowledge representation we see growing on our platform, which simply means being able to make patterns and sense of the data within their organization. And so freelancers, I think what you see is those that are traditionally trained in data science machine learning are really adapting and evolving and understanding what does that mean in light of generative AI and.

This new tool that they have now at the disposal?

This new tool that they have now at the disposal?

I mean, who are these people?

I mean, who are these people?

Are they were there and they're just fine tuning their skills or all of a sudden people are running out and getting trained, Like who are these people that are now maybe considered part of the AI workforce while we know AI has been around for a while.

Are they were there and they're just fine tuning their skills or all of a sudden people are running out and getting trained, Like who are these people that are now maybe considered part of the AI workforce while we know AI has been around for a while.

Yeah, so what we see is two things.

Yeah, so what we see is two things.

Absolutely, these are freelancers who've been on our platform for a while, who again have been you know what we call now traditional AI, have been working in this domain for a while, and they're becoming much more in demand as they're adapting to new genitive AI. In fact, like, from a wage perspective, we're seeing those same data scientists who are now working alongside generative AI models commanded twenty two percent increase in their work, which I think is great. But we're also seeing new freelancers come into our platform, especially from the younger generation, and our survey work, we continue to see gen Z in particular tell us that they prefer utilizing these, you know, top skills that they have coming out of college and see much more stability in today's labor market by managing our.

Absolutely, these are freelancers who've been on our platform for a while, who again have been you know what we call now traditional AI, have been working in this domain for a while, and they're becoming much more in demand as they're adapting to new genitive AI. In fact, like, from a wage perspective, we're seeing those same data scientists who are now working alongside generative AI models commanded twenty two percent increase in their work, which I think is great. But we're also seeing new freelancers come into our platform, especially from the younger generation, and our survey work, we continue to see gen Z in particular tell us that they prefer utilizing these, you know, top skills that they have coming out of college and see much more stability in today's labor market by managing our.

Portfolio of work. And so we're seeing a.

Portfolio of work. And so we're seeing a.

Lot of new entries as well, especially from the younger generation on our platform. What about from companies, Yeah, from like a demand perspective.

Lot of new entries as well, especially from the younger generation on our platform. What about from companies, Yeah, from like a demand perspective.

Yeah, because you're serve your two sided market. You serve you know, you serve the folks who are looking for work, and you also serve the folks who are looking for those folks. So you know, where are you seeing them adjust the way they're describing what they're looking for, the the talent that they think they need, that sort of thing.

Yeah, because you're serve your two sided market. You serve you know, you serve the folks who are looking for work, and you also serve the folks who are looking for those folks. So you know, where are you seeing them adjust the way they're describing what they're looking for, the the talent that they think they need, that sort of thing.

Yeah.

Yeah.

So you know, one of the things that we haven't published, but that I see within our online platform, which is pretty exciting, is oftentimes as you think about upwork and in the demand. We see that a lot in our small, medium sized middle market. But where we actually see some of the fastest growth right now for generative AI from a demand perspective is at larger companies, so larger enterprises, and in fact, like from an executive perspective, they're telling us about one in two executives today are actually turning to freelancers within these larger organizations to solve what they believe is an AI skills gap within their organizations. So as another example, you know, only about thirty percent of full time employees today say they're ready and willing and able to work alongside AI, and that's becoming a growing skills GT gap. We talk a lot about tech deck within organizations from an IT perspective, I don't know if we're talking enough about the skills debt that's within many of our organizations today. As the technology rapidly you know, evolves and increases in demand, and I see those executives turning to freelancers to help fill that within their organization.

So you know, one of the things that we haven't published, but that I see within our online platform, which is pretty exciting, is oftentimes as you think about upwork and in the demand. We see that a lot in our small, medium sized middle market. But where we actually see some of the fastest growth right now for generative AI from a demand perspective is at larger companies, so larger enterprises, and in fact, like from an executive perspective, they're telling us about one in two executives today are actually turning to freelancers within these larger organizations to solve what they believe is an AI skills gap within their organizations. So as another example, you know, only about thirty percent of full time employees today say they're ready and willing and able to work alongside AI, and that's becoming a growing skills GT gap. We talk a lot about tech deck within organizations from an IT perspective, I don't know if we're talking enough about the skills debt that's within many of our organizations today. As the technology rapidly you know, evolves and increases in demand, and I see those executives turning to freelancers to help fill that within their organization.

Why aren't they hiring them full time? If AI is such the thing going forward and everybody's investing and is all in why aren't they hiring full time AI people.

Why aren't they hiring them full time? If AI is such the thing going forward and everybody's investing and is all in why aren't they hiring full time AI people.

I think there's two reasons for that. One.

I think there's two reasons for that. One.

It's really tough because from an AI perspective, the job, like from a unit of analysis, jobs are going to think fall behind.

It's really tough because from an AI perspective, the job, like from a unit of analysis, jobs are going to think fall behind.

We see. It's much easier to think about it.

We see. It's much easier to think about it.

From a project perspective, a task and skill perspective, because it's so new and so emergent. I'm not even sure a lot of executives know what that full time role actually looks like today, but they certainly know they need the project or the skill set in place, and that just makes it a natural extension for freelancers, a much more natural fit. And then, if we're going to be honest with you, I mean, we're in a tight job market right now. I still think executives today are hedging when it comes to full time hiring as they begin to navigate this market. And instead we see much more bolish sentiment in type labor markets. Again, about one to two executives who plan to increase hiring for freelancers, and it really helps hedge their balance sheets as they go into twenty twenty five.

From a project perspective, a task and skill perspective, because it's so new and so emergent. I'm not even sure a lot of executives know what that full time role actually looks like today, but they certainly know they need the project or the skill set in place, and that just makes it a natural extension for freelancers, a much more natural fit. And then, if we're going to be honest with you, I mean, we're in a tight job market right now. I still think executives today are hedging when it comes to full time hiring as they begin to navigate this market. And instead we see much more bolish sentiment in type labor markets. Again, about one to two executives who plan to increase hiring for freelancers, and it really helps hedge their balance sheets as they go into twenty twenty five.

What I need to turn them mic here?

What I need to turn them mic here?

Sometimes you know, with AI, I would.

Sometimes you know, with AI, I would.

Just recognize when just go the mic needs to go.

Just recognize when just go the mic needs to go.

On talking to AI right there.

On talking to AI right there.

It would be better. It would be better than me at that. I do wonder though about this tight labor market. Have you seen the tight labor market that you described, because certainly we're not seeing it as tight as it was at the height of the pandemic, or not the height of the pandemic, but height of post pandemic. I should say, where specifically are you seeing it tight, because you talk to some folks out there, at least anecdotally, and we're also seeing this in the numbers that come from the government, but it's it's not as tight as it was. And folks who are looking for work, and this is anecdotal, it can be pretty tough out there, especially for recent college grads.

It would be better. It would be better than me at that. I do wonder though about this tight labor market. Have you seen the tight labor market that you described, because certainly we're not seeing it as tight as it was at the height of the pandemic, or not the height of the pandemic, but height of post pandemic. I should say, where specifically are you seeing it tight, because you talk to some folks out there, at least anecdotally, and we're also seeing this in the numbers that come from the government, but it's it's not as tight as it was. And folks who are looking for work, and this is anecdotal, it can be pretty tough out there, especially for recent college grads.

Yep.

Yep.

So I think we're going transitional labor market right now, and we see this anytime that technology becomes disruptive. And to your point, coming out of the pandemic, we were an unusual time with customer behavior habits at all times high when it came to technology companies in buying habits online, and so I think we got out of balanced pretty quickly during the pandemic and I think we've now resumed to somewhat of a normal market, but we continue to see disruption, whether it's the La wildflyers. I'm here in Florida, we saw snow for the first time in a while, and so we continue to see this climate disruption as well that I think is influencing a lot of the data that we continue to see. And so I think when in a transitional period, I think companies are still trying to figure out what does AI mean for the business, what sorts of talent and skills do they need within their organizations, and I think you see some hedging going on, especially in the tech space, as they begin to right size their organizations for the demand that's actually there today post pandemic, as well as figuring out what is the AI development in research that I need to have done and that's certainly an investment. And I think again this is where from an upper perspective we benefit from in tight labor markets, freelance.

So I think we're going transitional labor market right now, and we see this anytime that technology becomes disruptive. And to your point, coming out of the pandemic, we were an unusual time with customer behavior habits at all times high when it came to technology companies in buying habits online, and so I think we got out of balanced pretty quickly during the pandemic and I think we've now resumed to somewhat of a normal market, but we continue to see disruption, whether it's the La wildflyers. I'm here in Florida, we saw snow for the first time in a while, and so we continue to see this climate disruption as well that I think is influencing a lot of the data that we continue to see. And so I think when in a transitional period, I think companies are still trying to figure out what does AI mean for the business, what sorts of talent and skills do they need within their organizations, and I think you see some hedging going on, especially in the tech space, as they begin to right size their organizations for the demand that's actually there today post pandemic, as well as figuring out what is the AI development in research that I need to have done and that's certainly an investment. And I think again this is where from an upper perspective we benefit from in tight labor markets, freelance.

Bekends to be on the rise when we see markets such as this.

Bekends to be on the rise when we see markets such as this.

One thing I wanted to ask you, Kelly, is now that Donald is you know, first week in office. He's been pretty busy and one of the first moves that we saw I've really kind of had to do with affirmative action and specifically DEI initiatives diversity, equity and inclusion and basically ending that for programs throughout the federal government. We're also talking about government contractors, and I am curious, since you are this great intersection of workers and companies, how that might impact their hiring if at all.

One thing I wanted to ask you, Kelly, is now that Donald is you know, first week in office. He's been pretty busy and one of the first moves that we saw I've really kind of had to do with affirmative action and specifically DEI initiatives diversity, equity and inclusion and basically ending that for programs throughout the federal government. We're also talking about government contractors, and I am curious, since you are this great intersection of workers and companies, how that might impact their hiring if at all.

Yeah, we actually just released a book yesterday, congratulations.

Yeah, we actually just released a book yesterday, congratulations.

Its called thank You Yes. And because I mean again it's it's been.

Its called thank You Yes. And because I mean again it's it's been.

An amazing week to see all the changes that are taking place. I mean, I can tell you from the research. The bottom line is higher performing companies are those that have diverse talent pools. I mean, innovation comes from diversity. I think that's been pretty well proven time and time again in the research. And so the question is going to be for companies, this is no longer going to be a requirement. It's not going to be regulated by the government, and it's going to be up to leaders now to make that choice. If they want to maintain a competitive, innovative environment, diversity still has to be a cornerstone of how they operate. And so you know, in some ways I'm optimistic that some leaders are going to be the right side of history here and continue to move in a direction that feels diversity on their own as a choice, not as a check a box program. That I think is where some of the frustration came from. So I'm eagerly watching this trend. But it's certainly a choice that leaders will have to make. And the research is pretty clear here diverse companies will outperform those that are not.

An amazing week to see all the changes that are taking place. I mean, I can tell you from the research. The bottom line is higher performing companies are those that have diverse talent pools. I mean, innovation comes from diversity. I think that's been pretty well proven time and time again in the research. And so the question is going to be for companies, this is no longer going to be a requirement. It's not going to be regulated by the government, and it's going to be up to leaders now to make that choice. If they want to maintain a competitive, innovative environment, diversity still has to be a cornerstone of how they operate. And so you know, in some ways I'm optimistic that some leaders are going to be the right side of history here and continue to move in a direction that feels diversity on their own as a choice, not as a check a box program. That I think is where some of the frustration came from. So I'm eagerly watching this trend. But it's certainly a choice that leaders will have to make. And the research is pretty clear here diverse companies will outperform those that are not.

Well, so are you saying that folks who look at this from the perspective of the free market and they say to themselves, well, I want the team that does the best job, then inherently it will be diverse and sort of the market will solve this.

Well, so are you saying that folks who look at this from the perspective of the free market and they say to themselves, well, I want the team that does the best job, then inherently it will be diverse and sort of the market will solve this.

I hope.

I hope.

So, I mean, at the end of the day, though, we are a human and we certainly know that there's a bias out there, and so I do encourage, especially like HR.

So, I mean, at the end of the day, though, we are a human and we certainly know that there's a bias out there, and so I do encourage, especially like HR.

Professionals, this needs to be regulated within your own company.

Professionals, this needs to be regulated within your own company.

You need to have the policies and programs in place that make diversity easy for your organization. And so again, this is going to be something that comes are going to have to tackle on a big sobe spaces. I want to see the free markets are going to work here, but I'm also realistic and know that as humans, we are biased, and so sometimes it may be a biased free market going on, which is why we still need to make sure that we've got the leadership programs in place to make this easy for leaders today.

You need to have the policies and programs in place that make diversity easy for your organization. And so again, this is going to be something that comes are going to have to tackle on a big sobe spaces. I want to see the free markets are going to work here, but I'm also realistic and know that as humans, we are biased, and so sometimes it may be a biased free market going on, which is why we still need to make sure that we've got the leadership programs in place to make this easy for leaders today.

Hey, Kelly, one last question, just got about forty five minutes forty five seconds. Excuse me, that would be a long question or a long response. First FED meeting is next week. Dual mandate of course, watching inflation and the labor market. How would you describe the US labor market right now? You guys have an interesting unique vantage point, So how would you describe.

Hey, Kelly, one last question, just got about forty five minutes forty five seconds. Excuse me, that would be a long question or a long response. First FED meeting is next week. Dual mandate of course, watching inflation and the labor market. How would you describe the US labor market right now? You guys have an interesting unique vantage point, So how would you describe.

It right now?

It right now?

Yeah?

Yeah?

Right now?

Right now?

I think labor markets in transition.

I think labor markets in transition.

We see this upwork today, we're moving into much more specialized skills. As companies get smarter with how they're using AI, it's becoming much clearer where they need the talent. And so we're a labor market in transition, and those that are being able to upskill and reskill and keep alongside of the technology. I think we're going to continue to be employed and we're certainly seeing now the freelancer side.

We see this upwork today, we're moving into much more specialized skills. As companies get smarter with how they're using AI, it's becoming much clearer where they need the talent. And so we're a labor market in transition, and those that are being able to upskill and reskill and keep alongside of the technology. I think we're going to continue to be employed and we're certainly seeing now the freelancer side.

All right, great to catch up with you. Thank you.

All right, great to catch up with you. Thank you.

Thank you so much, Kelly Monahan. She's managing director of the Epwork Research Institute. As we remind you, it is the research arm of the platform upwork at joining us from Orlando, Florida.

Thank you so much, Kelly Monahan. She's managing director of the Epwork Research Institute. As we remind you, it is the research arm of the platform upwork at joining us from Orlando, Florida.

This is the Bloomberg Business Week podcast, available on Apple, Spotify, and anywhere else you get your podcasts. Listen live weekday afternoons from two to five pm Eastern on Bloomberg dot com, the iHeartRadio app, tune In, and the Bloomberg Business App. You can also watch us live every weekday on YouTube and always on the Bloomberg terminal

This is the Bloomberg Business Week podcast, available on Apple, Spotify, and anywhere else you get your podcasts. Listen live weekday afternoons from two to five pm Eastern on Bloomberg dot com, the iHeartRadio app, tune In, and the Bloomberg Business App. You can also watch us live every weekday on YouTube and always on the Bloomberg terminal