This rally but also this volatility. Taylor you have been nailing this because we should have had a clue. Gold has been higher all day long and you were on top of that in the past few weeks. Romaine base metals up, too. Copper up 2. 5 in london earlier today. With regards to some of the positive stories. Pepsi did manage to finish the day higher, largely i presume on the back of that she does mac cheese. s mac cheese. Senior, avoid a Portfolio Manager and Asset Allocation head. Apologies for some of the technical difficulties. Lets talk about the earnings season, your general expectations, and whether valuations are in sync with that. Earningsms of startingons, you are to see revisions start to climb. The market is really looking towards 2021. On isg thing to focus central bank liquidity. That drives asset prices. When the economy is acting below potential and the quiddity is being pumped in, it tends to drive up asset prices. One thing we are watching very carefully is the growth rate of new cases, measured by the weekly change and the seven day moving average. It was a very clear leading indicator for us that cases were starting to peak. Thate that data shows cases are slowing in 44 states over the past two weeks but the absolute numbers everywhere remain very, very high. To combat thehow transmission of it. People have to social distance, wear masks. The bad news is that the that peak where it is just starting to slide down to the other side. Caroline when you are looking at allocating assets, looking at the health data you know have to be an expert on, what about the retail versus institutional buying. At one point. 4 how much does that change the perspective of where you want to be putting money . Barbara broadly, when we look at the equity market, there continues to be a buyers strike. I would say that there is probably also a sellers strike in highyield credit and credit overall. And certainly tech. For us, what we think is very important, a lot of institutions missed the big rally in the second quarter. At us, when we are looking our positioning data, Hedge Fund Positioning is relatively low, institutional positioning is relatively low as well. It can be very unnerving for investors. Of way we think in terms allocating our portfolio, we think the u. S. Will continue to outpace the rest of the world. You were citing data out of china. While that may be the case, tensions between the u. S. And china are likely to flareup going into the election. It is a very big point for the trump base to get rallied up over. There is broad support for continued keeping some pressure on china. The other thing i think the market is very worried about today is that there has been looming fiscal cliff on july 31, that congress has to pass legislation to continue to support unemployed workers. That is another big one. March,can see, back in that was also pointing us to days that congress was kind of gathering to pass legislation. This might be very similar to it. Romaine there are a lot of events coming up. We also get the Economic Data in the u. S. We get china gdp this thursday overnight. It will be interesting to see how the second largest economy is holding up as well. At the end of the day, there are a lot of folks who want to stay invested in the market. They want to be exposed to equities. How can they do that in a way where you can be a little more defensive and hedge your bets . Ofbara the best way is kind hedging your positions in terms of owning some equities and fixed income as well. I know you had cited that you dont think bond yields can go much lower. That probably is true. But november, bonds can be a very good hedge against equity volatility. We are focusing our portfolios much more on the u. S. Do believe that the u. S. Dollar is likely to take a respite from recent declines. And there is no country in the world that has as much fiscal and monetary support as the u. S. U. S. Iswe think the probably going to be the longerterm winner over the next couple of years. It does not help of course that the u. S. Is also the focal point of the rate of infection. We do know that the authorities have decked so many resources against it. The fed has told us they are not even thinking about thinking about raising Interest Rates for quite some time, we know it would come down to the fiscal support we believe would be passed. 11. 5 of American Workers out of work. You have to give them support. Caroline barbara, thank you again. That does it for the closing bell. Whatd you miss . Is next where we will hear from carlisle cofounder David Rubenstein with doug mcmillon. This is bloomberg. Taylor from bloomberg World Headquarters in new york, i am taylor riggs. Caroline you missed a sharp turnaround, from 200 points higher to 200 points lower on the nasdaq to close down across the two major benchmarks. Concerns about covid, concerns about the u. S. And china. Nfl team istons undergoing a revamp. Leadership live. Mcmillon joinsg David Rubenstein on the retailer s reaction to the virus. Romaine we are going to talk about what actually happened in washington today. The professional Football Team down there said it will retire the teams name and logo. Financialnd other partners were potentially pulling out of deals with the team. Joining us, from the navajo nation, the lead plaintiff in blackhorse versus pro football inc. Which sucked to remove trademark for that which sought to remove trademark for that name of the team. This is a name that has been around for decades, was trademarked i believe back in the 1960s, and was almost immediately contested. Why did it take 50plus years for this thing to finally be retired . I think this has to do with invisibility of natives today. We have done everything in our power to try to get the Washington Team to change. I think just recently, the reason why it happened is just because of the unrest in this country and people understanding more about what Racial Injustice is. I am talking about after the murder of george floyd and the black lives matter movement, i think that is a surge that really pushed it over the edge. Caroline it helped push the sponsors over the money talks in many ways. I am interested whether you think the same sort of change will be enacted whether companies and teams lead the charge or are responding once again to sponsors like cleveland and the atlanta baseball teams. Amanda we have been very focused on the Washington Team for many years. I think that the other teams like kansas city, atlanta, and chicago, think they are going to just fly under the radar and we are not going to notice them. But they are groups that we are going to push. This Investor Campaign that happened was not just something that happened out of the blue pepsico, fedex. They have been pushed for a very long time by a group called Indigenous Peoples working group. They have been asking for this for many years. The i said, i think it was unrest in this country that really pushed it over the edge. Taylor it is interesting that you mention the panthers, the chiefs. Where do you see further pressure on everyone to relook at their mascots, their names . How much mass how much more pressure do they now feel in washington . Amanda the panthers are not on our list. We are more concerned with the chiefs, the braves. I am using quotation marks here. The braves and the chicago team. We never thought this day would come with the Washington Team. At least i did not. In all of the years i had been involved in this. Think at this point, it is the native appropriation, the billion dollars industry that profits off of these people. I think at this point, they should be feeling the pressure. I know that the cleveland team, they retired their logo a couple of years ago and now i think they said they are reconsidering changing the name but it sounds like they are backing off that a little bit more. But definitely we will put the pressure on and they should be feeling this as well. Romaine you mentioned how, lets say with regards to some of the sponsorships and other business interests tied to the Washington Team and other nfl teams, that there has been a lot of pressure on some of those companies to distance themselves from this. You go back to the Supreme Court case that was decided in 2017 where the Supreme Court did not necessarily give you a victory but it did effectively say it was a derogatory name. You go back to other court cases that seemed to have nudged the conversation a little bit deeper. Thatu think the activism you do, going through the court system, are there other ways that you think the change could be brought more quickly . Ofnda i think the idea going for the trademark of the Washington Team was to get rid of their trademark and registration, and they would essentially not be able to make any money. What really speaks the loudest here is money. Push,k, with the investor they were speaking the language of money. Native people have been asking for this for decades. Says one day they should change the name, the next day they are doing a thorough review. It really shows you that money is the real motivation here. Even after everything we have , nothas Indigenous People to say that our work was done for nothing. We have definitely changed a lot of opinions, we have won in the court of public opinion. Caroline is there anything other than the world of sport that we currently talk of . Where else do you focus your attention . Where else have you been having to deal with the ramifications of this current tide turning . Andda definitely mascots racial names in schools. From elementary education, high school, colleges, professional sports, that is really on focus here. Not in it has not been an easy task at all. Ou recently had land o lakes the Cultural Appropriation of Indigenous People. We have also targeted local companies here in phoenix called yandy, and got them to retire their entire native american costume line. I think it is a very Broad Spectrum when we talk about Cultural Appropriation of native people. Caroline we thank you so much for your time. Amanda blackhorse. Coming up, teaming up. Wolf research and nomura discuss a strategic alliance. The future of research. This is bloomberg. Romaine Wolf Research and nomura announcing a strategic agreement for a u. S. And canadian alliance. Wolf Research Founder and managing member ed wolf joins us now to discuss. Congratulations on this deal. I am curious as to what Wolf Research got out of this deal. Thanks. It is great to be here. Wolf got out of this is the ability to get into different parts of the market that we are not in right now in a big way. So, over time, while we have built a Research Powerhouse with content that is unique on the street, we need to improve our ability globally to distribute our work and execute it in a fashion that is as strong as our content. Nemora has the intranet. They also have a really high end derivatives and options business that will allow us to take our content to new levels. We have 100 control over our content and we will continue to have our independent research. Nd Research First tech my experience has been impossible to do at the large banks in the right way. Caroline i am interested in what the marketplace looks like right now and how Many Research houses each investor can have at the moment. How are you finding the landscape for yourself and how are you ensuring that you win out in such a tough landscape . What we have done since the beginning is to try to be the best at what we do, which is equity research. I was an analyst for over 20 years. I was the number one analyst prior to starting Wolf Research, at their sterns. We have gone out and hired really passionate top differentiated analysts from bank of America Merrill lynch, j. P. Morgan, Barclays Deutsche bank. Timese now done it seven where we have hired the top analysts from these firms. Goodu have really differentiated research, then you can have some pricing power. In a market where our clients have been under pressure so long. As recently as two years ago, some of the large long onlys and hedge funds they have probably dropped still to a way to high number in the hundreds, 150, 200. Over time, we hope that will come down to 25 or 30. We are ranked number seven in the u. S. And in terms of number one analyst, fourth. We feel very good that we are taking a lot of share. We are also investing heavily in research when the larger banks are not stepping up to defend and hired new Research Like we are doing. Covid and this pandemic has created new opportunities and challenges and people are cutting costs. Respond to clients that are continuing to cut costs not only this year but potentially next year as well . Seen is a lotve of volatility in the market we have seen more commissions in the nearterm than we have seen for several years. That being said, we are seeing a lot of uncertain t, a lot of disconnects between what looks like fundamentals. This are keeping our ion for the future. Downusly, our costs are for things like traveling. Our costs are down for things like conferences. We host 11 conferences. Normally, we do these had hotels. One ins year, we had january that we did live. To ourh, we switched fintech conference virtual. The rest through this year we are committed to doing virtually. We are saving a lot of money right now on costs on travel and things like that. But we are seeing opportunities to hire because of the large banks, there is a lot more concern than we have over some of these things. Sort of came shop about, there was this wave of independent Research Companies a decade or so ago when some of the more traditional big wall street banks started to scale back on that front before. I wonder what the General Health of some of those businesses are. Wondering where you see the place of independent research in the current orchid environment, specifically from a profitability perspective. Ed i think there is great place for independent research. When you are one or two analysts, it is really easy to make a lot of money if you are really good and own your sector. We have seen that over the years in macro and more recently in sectorfocused research. Ultimately, the clients want that really highend independent research but they want it through enough set yours that you add value no matter what factors are happening. And also want macro fundamental client work. You have to be able to provide all of that. The people who are struggling right now are either too small or too large and not focused on research. Wolfe, congrats on the deal. This is bloomberg. Forline time now leadership live with David Rubenstein, speaking with Walmart Ceo Doug Mcmillon about how the retailer is managing through the Global Pandemic and its latest ambitions to take on amazon prime. David thank you for coming on the show today. Many companies have been hurt in the covid19 crisis, particularly retailers. But it seems as though walmart has done pretty well. You are hiring more people than you are laying off. Is that correct . Doug in the u. S. Alone since the middle of march, we have hired over 400,000 people. Caroline david why are other retailers unable to get street traffic and you are . Or is it more online sales . Doug in our case, i think it starts with the fact that we sell food and consumables and things that people need during the crisis. We have stayed open mostly throughout the crisis, selling food, consumables, other things people need in stores and online. I think you are alluding to the fact that ecommerce has really grown during this time and that has certainly been the case with us. David how many total stores does walmart have . World, 11,000. E here in the u. S. , around 4700 stores, and another 600 sams clubs. Millionou have 4. 4 employees or associates. Annual revenue is about do you expect to hold onto all these employees or do you think there will be a decline in sales after we get past the covid19 situation . Doug as we started into this period, we created a leave policy for associates who had to stay home if they had a Family Member they needed to take care of for some sort of concern. Hundreds of thousands of our associates who needed to order wanted to stay home have. So we had the need for a lot of serve to run the stores, as it relates to ecommerce, and take care of the demand as it has gone up. 400,000 we have hired since the middle of march are temporary in nature so we will retain a big portion but certainly not all of them. David when you look at your sales for products, what has been the most demand . Of the things that are, lets say, dry goods or other types of things . Hand sanitizers, face masks, things like that . Doug one of the interesting things to watch, and it played out pretty consistently around the world. But if i take the u. S. For an example, americans seem to move together through phases of this experience. From the beginning, people were looking for hand sanitizer, sanitizing wipes, paper goods. It then moved to stocking up and things like shelfstable food really took off. There was a period where there was a lot of pressure on beef and pork and things like that. But then, this realization that they needed to educate and entertain their kids and themselves led to categories like puzzles sellout. Puzzlesot sold out of in a really long time. But we saw that behavior spread into things related to doityourself at home and home categories. You can imagine, if you are in your living room, your home office, even your backyard, you see things that you want to improve. We could see the country move through these phases and by the same categories together. We have sold out on things like bicycles. If you and i went to a store right now and walked around, we would see far too many out of stock for what you would normally see in a Walmart Store. David what year was walmart started . Doug 1962. Heid sam walton, what did do that made it grow into this empire . In retailingbeen before. He wanted to try some things differently. He wanted to sell a broad assortment of merchandise at an Everyday Low Price and he wanted to serve small towns that did not have access to quality merchandise at value. In the beginning, people told him he was going into towns that were too small to support the kind of store he wanted to run, but he proved them wrong. He figured out that to really serve his customers well coming needed to own distribution. So he borrowed money and went into the warehousing business, running his own Logistics Business at a really early phase, which was unusual for retailers at that time. The fifth ceo in the history of walmart, is that right . Doug yes. David and you work out of sam waltons old office . I do. There was an office out on the front near the parking lot that was his when he ran the business and i am blessed to be in that office today. David i assume it is a very plush office. Doug it is the opposite. It is the Humble Office that you would expect. The great decision that somebody made was to go into food. You are the biggest food retailer in the United States, is that right . Doug we are. I think david deserves a lot of that credit. We started in the late 1980s with this format that we call the hypermarket. These big stores in europe, they were too big and they did not work. But david and the team just kept working on how to find the right size store with the right assortment. That became the walmart supercenter. From thereon, it has just grown into this business that is part food and consumables and parts general merchandise, including apparel. Perfected, ite seems to me, the idea of the Global Supply chain. Over, seldomducts at a price in the United States. Are you going to change your Global Supply chain because you are too dependent on china . Doug about two thirds of what we sell is made here in the United States. Even those goods that are grown , it is notduced here just that the supply chain was stretched for me global perspective, it was stretched locally as well. The percentage that we sell that is sourced domestically is even higher because those businesses are even more of a food business. Do i think things will change . We have had a multiyear plan in place to buy more locally and that push will continue. I think that in the case of personal protective equipment, things like masks, we have been pushing hard to find even more production out of the u. S. And i think some of those trends will continue. David the theory of the Global Supply chain is that youre getting things made at a relatively lower cost than could be made in the United States. If you produce more in the United States or have less of a supply chain, will that inflate your price a little bit . Doug it could in some instances. We try to offset that by using the latest automation or other tactics. Also true that wage rates in asia and particularly china have been going up. Havede of the country, you longer lead times and challenges. From ourwe would buy u. S. Stores as much as we can in the u. S. By locally because you get less lead time. The whole system works together. But there are times when importing is the most economical way to get a value for customers. Covid19, have you been running the company remotely from your home or are you able to come into the office . Doug i am out at stores, Distribution Centers, clubs pretty frequently. Beyond that, imf home working from zoom. Every once in a while, i am up here in the office for a few meetings. The most memorable part is what is happening when i visit stores, clubs, Distribution Centers, seeing our associates that are coming up that are stepping up and coming to work every day, adapting to the use of facial coverings, washing their hands, maintaining social distancing. We have done a lot of things like reduce store hours for extra cleaning at night. We limit how many customers can come into the floor. Into the store. There are markings on the floor to show how long is six feet. There are plexiglass shields up at checkout stands and pharmacy. Been tryinges have to do the best job they can in keeping each other safe and customers safe. That is what i will remember from this whole experience is the time with them rather than living on zoom. David your associates, have many of them contracted covid19 . Had cases. Ve our stores in hotspot areas have increasing cases and we have some additional steps we take to try and make sure they are safe. Basis, on a per capita both in case count and fatalities, we are well below state, county, and national levels. David if i go to a walmart this afternoon, will i be required to wear a mask if i go in and shop . About 3700ill be in locations where local governments or states have mandated it. We do not currently mandated in the other stores but that is something on our minds. David lets talk about your background. Did you go to a fancy ivy league is the school . Did you work at a fancy Consulting Firm . Private equity firm . How did you get this job to be the ceo of walmart . Arkansas,ew up in went to the university of arkansas, a little later went to the university of tulsa to get my mba. Through much of that experience, i got to work for walmart. I started as a teenager unloading trucks, ended up working at a store, then came into the home office. Thats been 29 years since happened. I am educated by walmart mostly. David when you go into a Walmart Store, does everybody know who you are . Doug the store Management Team will almost always recognize me but many of our associates would not. It is fun. I go to Stores Almost all the time unannounced. I want to see what customers see. When i show up in a community, i will walk into the store, start walking around, talking to customers and our associates. Is any customer ever say to you, i think they should do better . What do you say to them, i am the ceo and i will fix it. Doug sometimes. I am out like at the grocery pickup area, one of our growing parts of our business, asking, how are things going, what can we do better . Sometimes i will tell them what my job is, sometimes i dont. It depends on the circumstance. David there is a myth maybe it is a myth that the most important things one is the lowest possible price. What do the people most want . Doug they definitely want value, which is a combination of price and quality. But once we have the quality right, we are obviously trying to sell it for the lowest possible price that we can and manage the x of the business all throughout the store. But they also want to get in and out. That is why our grocery pickup and Delivery Business is growing as fast as it is. Because everyone is busy. And in a covid19 world, they obviously want to touch listings and be out less. Inhave seen strong growth our ecommerce business, whether that is delivered from a store or picked up in the parking lot. David you bought a Company Called jet. Com. I think recently you said you dont really need the name jet. Com anymore, it is just walmart. Are you happy with that acquisition . Doug we are. We would definitely do that all over again. We saw an acceleration in our ecommerce business. We started integrating the backends very quickly, doing shared fulfillment, shared technology. Our plan was when we started that the jet brand name would be used in more affluent markets of urban markets, younger customers, and walmart will be the lions share. What we have found is that walmart is working everywhere. It does not matter where you live. Been adding so many brand names to walmart. Com that customers have accepted that brand. Now we just dont need to put the marketing dollars behind supporting a second brand. David we talked earlier and you carry around i guess on your portable phone a list of the top 10 retailers in every decade over the last century or so. In the early part of last century, sears was the leading retailer for much of the century. Your point is that retailers tend to go out of business and they have to be very nimble. What do you do to make sure you are not out of the top 10 list at some point . Doug part of the dna here that we inherited from sam walton is dna that includes change. If i were with you in front of a group of Walmart Associates and we were talking about the company, i could Say Something like, other than our purpose and value, the other thing that is consistent walmart is and the group will respond back, change. It gives you an opportunity, which is so important business and retail, to decide what needs to change to serve the customer better in the future. It gives us a shot. The reason that we focus on retail history is just to remind ourselves, it does not matter how big you are. You can go away and you can go away quickly if you are not moving to where the customer wants to be served in the future. We want to get people really open to embracing what is next. In some cases, the things that need to be built is less profitable. The pickup and Delivery Business come in the beginning, detrimental to earnings in terms of mix. If you can grow the top line, you can figure out a way to generate a return for shareholders. David malls are hit by covid19. People dont want to go to malls. Are people still willing to go into your stores because of the many things you have in them . That i think it is mainly we are carrying things they need every day. The food and consumables, really important. We are also very close to customers. Of 90 ofhin 10 miles americans. You can come in and not count a lot of different item and knock out a lot of different items in onestop. That, combined with the efforts we have made in digital have helped customers stay in our brand. David your biggest competitor in the Online Businesses amazon, is that correct . Doug it is, here in the u. S. David what have you learned from amazon . Today teach you certain things inadvertently to make your Online Business better . Doug whether it is them or others, i think the goal is to learn from them and apply what should be applied. The customers want convenience, broad assortment, and timely delivery. In other respects, we have a set of assets that are unique to walmart. And we are trying to put them to work. Differences the big is how we are using our stores. And the fact that you can go on your app, purchase items or reorder items on the swing by the store later that day, somebody will drop in there for you, it is super efficient. There are unique assets to our strategy and i think the there have been rumors that you are going to announce some sort of prime equivalent for walmart. Is that going to be announced soon . Doug the speculation you are referring to is that we will launch a more robust membership called walmart plus. This grocery consumable delivery, delivery from the supercenters, which can include backtoschool items or even apparel items, done in a really fast manner as part of a membership program, is something that we think will be compelling bull. Will be compelling. We have some confidence that people do want a membership from us. If you think about it, there is a delivery cost of picking and delivering an order. Bulk an ability to buy in those deliveries from a discount. That is the form we have taken. That it is also rumored theare going to get into Health Insurance business. Have an aspiration to get into health care. Not having enough aspect not enough asset not enough access to preventative care. We have started an initiative that includes opening clinics. They are called walmart health. We have now opened four. They are preventative in nature with a health care doctor. You can get xrays done, you can get blood work done, you can get your teeth cleaned. There are dentists that are cleaning teeth and doing other things. Service, hearing optical and physical along with our pharmacy. Even for those who may have higher deductibles. Presencethat physical and clinics will enable us to lower the cost of health care. Again, preventatives of a high Quality Health care. Bolt ons thatther can make that more effective for customers. David what percentage actually use cash and a credit card or credit card equivalent . Lets talk for a moment about what you are doing in the various areas. Have you been making contributions to food banks, other things . What have you been doing philanthropic lee in that area . Philanthropically in that area . Doug i think we have done Something Like the equivalent of 4 billion meals donated. That has certainly continued during covid19 in addition to some Cash Contributions we have made. And the racial area, you have made a hundred Million Dollars contribution for some racial equality . Have funded initiatives for local communities. David what is the racial composition of your workforce and team in terms of diversity . Doug in the u. S. , a little over black our associates are or africanamerican. Dontmpany, those ratios play all the way through. As you would guess, with any company like ours, we have had a focus for a long time on diversity and inclusion. We are not as diverse as we aspire to be, and that is something we are working on. The Business Roundtable, their mission is generally to affect policy to some extent. What is the initiative that the Business Roundtable is pursuing right now . Doug there is a lot going on but the two big themes are related to covid19. How do we safely get our economy moving with the emphasis on safety. And more than a month or so now, we have really been focused on Racial Equity and we have set up different teams to focus on complex systems related to Racial Equity. Police reform in particular. The health care system, education system. There are different ceos that have taken leadership roles to help look at these complex systems with a Racial Equity lens in particular and bring back what the federal government, State Government can do to create a more equitable country. At walmart, what is the most popular thing that you sell . What is the most commonly bought thing at a Walmart Store . Doug still bananas. We sell billions of bananas. The other day, i was in a Distribution Center and got to go into one of our banana ripening rooms. We have these rooms where the environment is controlled in a way where the banana ripening process is more predictable. I learned that it smells really good in these banana ripening rooms. If you ever want to go to one, i will take you. David someday. You dont have any gray hair, it seems like you are very calm, you dont have many worries i guess. Do you have anything that keeps you up at night . Doug i sleep pretty well. But obviously, there are things that we worry about. This time period has been incredible. I find it hard to describe briefly. But there have been times in these past few months that caroline leadership live with David Rubenstein, with the walmart ceo, speaking about the joy of the banana ripening room. That conversation is ongoing. Go. D over to live this is bloomberg. Emily welcome to bloomberg technology. Stocks rising to their highest levels since the pandemic again and pulling back sharply. Search in various cases across the country. Florida marking its biggest increase in cases statewide ever. This as disney world reopens case