tv Bloomberg Markets European Close Bloomberg November 8, 2021 11:00am-12:00pm EST
johnson and alix steel. guy: monday the eighth. 30 minutes to the close. what do you need to know out of europe this hour? cases continued to surge across the continent. the german incidence rate is at a record. schoolchildren in large parts of france now wearing masks again. we are going to hear from the austrian finance minister a little bit later on in this program. the u.s. reopening to foreign travelers. we we hear from the -- we will hear from the ceo of virgin lending and iag regarding what it means for carriers. gas prices continue to soar with no signs that russia is going to deliver the supplies promised by vladimir putin. i think u.s. markets are up for an eighth day in a row. europe a little bit more mixed right now, but they stuck 600
continues to climb. 484 is where we are now trading. we continue to inch ever higher, up by 0.2%. gas prices continue to move ever higher as well. there was an expectation maybe we would get more russian gas coming through the pipes today. hasn't happened. maybe it happens tomorrow. alix: breaking news for you around the fed. fed vice chair for supervision randal quarles submits his rising nation, effective at the end of december. his term as head of supervision was actually over in october, but now it looks like he is submitting his resignation that will end in december. this just adds a lot of continued question marks as to what the fed make up going to look like midway through next year. you also have rich clarida, his term, his seat opens up in january if he is not renominated. there's also one other vacancy on the board of governors that is open, so another seat there that will need to be filled.
the question, will jay powell be asked to stay on as head of the fed as well? in the u.s., it is another record high, eight straight days of rally three s&p. i did want to take a look at some of the recovery trades. you have rising cases in europe, yet that is ok if you have this covid pill now from pfizer. it feels like that who are offsetting each other. we have seen that when it happened to merck as well. my question, when is guy going to come to the u.s. and board an airplane and stay in a hotel and come visit me here? he has been talking a really good game and still have yet to see any signs you are coming over. guy: i made it to the airport this morning. alix: and congratulations. guy: i just didn't actually make it onto a plane. a number -- a number of people have made the point to me, is the u.s. going to start to get nervous about what it is seeing in europe right now?
because you are seeing spikes in different parts of the united states, and i understand the area around the great lakes is experiencing one of the moment, but across europe, numbers are starting to really rise quite rapidly. in the u.k., a return to lockdown measures is apparently still reportedly under consideration, though i think really politically toxic. germany's infection rate i think now is the highest level since the start of the pandemic. you've got austria putting new rules in this morning. it is a story really across the continent in terms of what we are watching. how worried should we be, or as you say, does the pfizer pill, the improvement in therapeutics mean that this is a manageable situation? molecular epidemiologist at the inversely of burn is joining us now. and q very much for your time. are you worried about what we are seeing with these numbers? >> i think the most import we are talking about europe as we
are looking at a really heterogenous situation. we have countries in eastern europe with fascination rates as low as 20%, 30%, all the way across to western europe and portugal, which has an almost 90% vaccination rate. the reason this makes things a little difficult is because that makes a big difference in how cases translate into hospitalizations and deaths. of course, vaccination will help keep those cases low anyway, but in places with a middling vaccination rate, 50%, 60%, 70%, it is not yet clear if this will be enough to mean even if you had a rise cases, you might not see a corresponding rise in hospitalizations and deaths, and what pressure will that put on your medical system. this makes thing at europe as a whole somewhat difficult because it means we will see different places. alix: i also feel like the conversation is now turning to boosters. some countries aren't even vaccinated, but we are now talking boosters. will we get to the place where if we don't have boosters, we
are going to be in some version of a lockdown? emma: we can see that unfortunately, it does look like particularly in elderly and vulnerable people, that really strong 90% efficacy that we know about from the vaccines does drop over time. luckily, boosters restore that, but it is definitely true to remember that if you have a low vaccination rate in your country , it is going to have a much larger impact on your health care system and on transmissions to get those first vaccines into arms initially because that is what gets that protection up to a high level, and then we can talk about boosters keeping that high and vulnerable populations. but at the moment, we still have a lot of countries where the vaccination rate for just those first two shots could be much higher to offer much better protection already. guy: alix steel now fully boosted which is worth bearing in mind. if i'm going to see her, i want to make sure she's got that booster in her arms. alix: you've got to go. guy: i will be getting mine
soon. i think i am allowed to apply for it next week, so i will certainly be stepping up. maybe that is what needs to happen to get me across the atlantic. in terms of what we need to do, and i hear what you say about the different story we are getting in different countries, but i am seeing numbers starting to rise. i was in portugal last weekend weather was actually still pretty good, so as the weather gets worse, maybe the situation changes there as well. do we need to, as france is doing, start to put our kids back into masks? do we need, as italy and austria are doing, to have covid passports being used on a regular basis >> -- regular basis? what can we do in terms of mitigation efforts? what works? what doesn't? emma: i do think the point you are raising are really important. even though we have seen some rises already, whether it will continue to get worse, people stay inside, and we do think
this has an impact on how much covid can spread. so i think it is really important that countries keep in mind that they need to stay flexible. this is where i person he don't like when countries promised that you will never do x, y, z again. you have to stay clickable willing to adapt depending on how the pandemic is changing. that includes trying to limit crowds, using covid passports so you know that people are either vaccinated or testing negative before they go into a risky environment. all of these are tools governments can use to try to reduce the risk as they see over woman demand on the health care system as we head into a winter that, and a lot of ways, is still a big unknown. guy: absolutely. and we will pay attention to the weather as well. great stuff. thank you very much, indeed. always useful to catch up. meanwhile, the world's most lucrative airline rates have
reopened today -- airline routes have reopened today. i caught up with the ceos of the two airlines you can see taking off simultaneously at heathrow at 8:50. there the virgin flight. they are both a350's. and the ba flight, closest to the camera. this is what the two ceos, of virgin atlantic and iag, had to say to me as this was happening. >> we should be at full capacity in terms of the number of sectors for 2019 by april 2022. >> in 2023, we will have a reduction in corporate travel of around 10%, 15% compared to 2019. guy: david furlong is joining us now to give us his take on what this means. we have had a short-haul recovery thus far.
we are now starting to migrate to a wide-body recovery. shai weiss was bouncing up and down, he was so excited about the impact this is going to have on his business a little earlier on. how big a turning point is this for the businesses and long-haul ? david: it is critical for airlines in europe, the long-haul airlines. it is a key market for iag, for virgin atlantic, for left anza, so it is critical. alix: what kind of money are we talking about? when do you think we had pre-pandemic levels, or is there a new normal we have to be looking at? david: they are already talking about having capacity, like iag saying capacity back to 20% of pre-covid levels by the summer,
so i still think in terms of demand it is one to take longer. i saw the ceo of iag talking about 2023. there is certainly an expectation that may be long-haul is going to take longer to recover than the short-haul, and corporate is going to take longer than leisure, and perhaps it is going to be shorter for longer with the likes of zoom. so the airlines have to make that up another way. for example, iag pre-pandemic was saying they could generate 2 billion need plus -- 2 billion plus euros in free cash flow, so they certainly have restructured , and to come back to where they wear pre-bid -- pre-pandemic before that happens. guy: does premium economy help? using we will see more of that? do you think we will see more
vfr traffic towards the front of the plane? what can cargo do as well? david: the airlines are certainly pushing that they are changing their inventory mix, so you see a lot of them talking about premium economy, a lot of them talking about premium as mixed between leisure and corporate. so aircraft are talking about a premium business with leisure. if this is the case, maybe you can recover quicker. i think premium economy is an important tool in the mix, but ultimately you have to be restructuring your business. if you want to generate the returns of pre-pandemic levels, you have to have a lower cost base, number one, and you have to play with a mix of traffic because clearly, corporate was a high revenue generating part of the business. alix: i want to point out that vfr is your pointy hat.
i had to look up what it was. you get the pointy hat at 11:10 on this monday. steven, when we take a look at who is going to be doing all of the stuff in the traveling, i know they seem pretty optimistic by the summer, but what we have seen is that people travel with pent-up demand, but it takes a while for business travel to start to happen. the people i am talking to are just now starting to go on business travel. do you think that is going to be the same for the trans atlantic light -- transit lenox light? -- the transatlantic flight? david: it is certainly going to recover with a lag. it is going to be behind the visiting friends all relations, the leisure traveling. that is differently going to be something where it is a laggard here, and long-haul is behind short-haul. a year ago, iag, and the rights
issue perspectives, the assumption was that they did transatlantic will be open by the fourth quarter 2020. so we are a year late, but it is better late than never. alix: fair enough. thanks a lot. really good to get your perspective there. coming up, what can really stop the euro rally? you are taking a look at equities hi again, he very somewhere story to here in the u.s. this is bloomberg. ♪
hit. [indiscernible] but progress is progress. the stoxx 600 looks a little bit like this. this goes back to the beginning of the year. as you can see, largely a straight line. what i think is really interesting is what is happening is this bottom chart. the blue line there is the docks. disick locality of the dax is really kind of shining through at the moment. the cac 40 having a relatively good time. the ftse made in italy is having a good time. the laggards in europe are actually spain, the ibex. the spanish economic recovery is a laggard in europe, and that is being reflected in the stock market as well, and the u.k. down there at the bottom as well. the cyclical element of europe doing really well. the french are being powered through by some of the industrials and the luxury story, but the dax is really where the story is.
that cyclicality shining through as we see the dax powering ahead. ed smith, rathbones co-cio, joining us to talk about this. germany is doing well. can europe continue to make highs? will these areas continue to power ahead from here? ed: good afternoon. we continue to say that european equities, for the first time in many years, technical considerations are positive against those headwinds. looking at the pmi surveys last week, they are likely to stay at levels consistent with continued earnings momentum. we got a very dovish european central bank. that eases pressures on valuations that might be felt elsewhere in the world. we also have less domestic pressure on inflation. but on the other hand, if we get an uptick on global yields and
global inflation risk, europe's energy stocks will likely continue to do well. so there's a lot of positives at the moment. we are still overweight. alix: what do you do with the u.k.? u.k. has underperformed and has not hit the same kind of highs we have seen in the dax. ap morgan came out and they are positive on u.k. for the first time since brexit, and part because that deep discount. ed: valuations tend not to matter at the country or next level. this very little information about whether one country is likely to outdo another, until you get to real extremes. that is where we are today in the u.k. the gap between u.k. valuations and global valuations when you look at price to forward earnings, not seen since the 1970's on price-to-book, when the u.k. had to get the imf for
a bailout. so when valuations have got to extreme wides in the past come on a three to five year view, that country tends to outperform. so we think on a medium-term come of the u.k. is overdue a bit of outperformance due to partial closure in that valuation gap, but we don't think that valuation gap will close entirely. there are still headwinds for the u.k. economy, for example, slightly unfavorable yes g, perhaps, and the fact that the dividend is not as secure as it used to be. guy: germany is still outperforming. the dax has had a very good year. germany is very exposed to china, though. you talked about the balance on either side of the ledger, at the moment coming out in favor of europe. do you think that continues? cobit is picking up. china is slowing down.
energy prices are going through the roof. ed: that is a great question. on china, we have a negative call on asia ex-japan equities, and the hang seng in particular, but there's obviously a read across those regions to some of the western companies and markets that are more exposed to chinese rates, like germany. so it is not a perfect trading strategy, but broadly speaking, china related plays tend to outperform when china's credit impulse is rising and underperforming the credit impulse is falling. we don't for see the credit impulse and china turning positive again this year. one of my golden rules is to pay attention carefully to what beijing is telling you. i think it is pure speculation to say they are going to stimulate and boost credit
creation, as some people are thinking at the moment. the property sector will continue to weigh on growth, coupled with the other reasons for the credit impulse turning negative, that i think will mean some of the stocks in europe that are more related to china will be a bit of a market laggard. alix: when you are trying to find out what the relative play is, i know you said valuations don't count in europe unless it gets really deep, what is the role of real yields? ed: if you look at the correlation between real yields and valuation of global markets, it has been very strong over the
last seven years. so i 1% rise is likely to shave off about two and a half times forward earnings from the msci world valuation. actually, a lot of that is already priced in at the moment. we have seen a big pullback in valuations, and perhaps markets are already anticipating that increase in real yields, but perhaps as we look ahead to markets where there -- where there is perhaps less scope for the real yield to rise, such as possibly the u.k., although we have a hawkish bank of england at the moment, but markets where you yields have less of a rise could be a safer place if you are worried about valuation contraction. guy: i think we are all confused about that one. in terms of the risk-reward in
these markets, the u.s. has been making record after record. just in terms of the risk-reward, the seasonality in europe, are you comfortable being fully invested in the market at the moment? ed: we are not as optimistic as we were during the summer months. we think that the risk of a monetary policy mistake is low outside of the bank of england. we think the prospect of an outright contraction or recession in the next six months. . is very low and there are uncertainties -- six months is very low. and there are uncertainties about profits in the future, but we think the likelihood that this midcycle expansion turns into a slow down contraction is very low, and unless you think
♪ guy: four minutes to the close in europe of regular trading. i think it is a coin toss as to whether we finishing positive or negative territory. energy stocks, mining stocks doing relatively well. the transport sector faded as the day has gone on, despite the news on the transatlantic. the dax has just turned negative. the ftse 100 is flirting with it. the cac 40 is up by 0.15%. this is bloomberg. ♪
equities. the regular trading just about done. european equities have struggled for a sense of direction today. we are fading into the close. i listened the commentary on what was happening at the open and it felt like what we are looking at right now. a lot of gray, not a clear sense of direction. volume has been light. it is better in the united states. i feel this market does not have a clear sense of where it is going. the ftse is flat, the dax is flat, the cac 40 is flat. a quick look at what that looks like. the stoxx 600, we did see a rally as europe got into gear. that has faded. i look at where we are yesterday , we are at 483, we are still at or near record highs.
huge momentum for european equities. let's take a look at where we are from a sector point of view. energy has done well. we see the mining stocks doing well. the health care sector is in there as well. it tells you about the defensive nature of this market. the bottom end of the market, travel and leisure is down. the car sector is off a little bit. that is largely down to volkswagen. heavyweight with the sector. down aggressively today. the double downgrade at jefferies. the analyst coming out and saying the comparisons we keep hearing from vw with tesla maybe not useful. a double downgrade. they are down to a sell at jefferies. at the same day they have upgraded to a street high at tesla.
downgrades for volkswagen manifesting in europe and weighing on that sector and also the dax. also weighing on the german market is a chemical company, and industrial company. they were talking about what is happening with the margin story. margin guidance as well. not looking positive. the industrial sector feeling the pressure of input costs. that stopped down 5.73%. iag friday out with numbers. today we are fading that move. i am not sure it has much to do with what is happening with the reopening of the north atlantic. i had a positive conversation with the ceo earlier on waterside. certainly a huge day for the european sector. alix? alix: let's stay with energy for a moment. european gas and power prices are searching. signs russia will not deliver
the boost in supplies president putin is promising. goldman says if those flows are not averaging at least 60 from this week on, you could see $30. that would be a huge move in european gas prices. guy and i sat down with daniel yergin and asked what can president biden do and he said russia is not completely to blame, it starts with coal. daniel: we do not see russia has a great deal more gas to put in because they were putting gas into their storage for winter because there inventories have been low. marginally russia could do more but this has to do with the fact this is an energy crisis that did not begin with oil, it began with coal. guy: and it began in asia and is now rippling through into europe. bloomberg's team leader for gas and power joining me now on set. daniel yergin talking about the
fact the russian still have a lot of gas they can distribute elsewhere. there is an expectation maybe would see more gas flowing into europe this morning. it did not happen. are the russians coming? >> they are not coming tomorrow either, which is very interesting. the orders were gas orders from germany. there is still quarter off the normal. not expecting more russia gas into germany. no extra pipeline capacity to send more russian gas into germany or throw -- or through ukraine so we are expecting another tight supply tomorrow. alix: does that mean we will be destined for what goldman is calling for. we are looking at $30 natural gas prices. are expecting to see a strain and gas demand? isis: it is definitely possible.
we have seen a big constraint. it is supposed to start getting cold next week. i think we are left with demand disruption. if we do not get russian gas there is not enough lng, there is not enough coal. we are left with hoping for more wind, which we do not usually get a lot in the winter, or hoping for more gas. we were expected to get it today as the russian and gestic -- injection season is supposed to be over. it also signaled there will not be an increase tomorrow. guy: how far of the russians through injecting into their storage. there was an expectation they would be done with that. if they are done with that and still not sending gas to europe, what can i take away from that? isis: i think they are done. they were already done in the
beginning of november and they decided to extended another week but they've already reached target. what most of the europeans read in is pressure for nord stream 2 to be approved. when you look at the situation, and russia could be sending more gas but it is not, there is only one conclusion. russia wants nord stream 2 to get approved. alix: what are some of the other conversations europe is having? just relying on nord stream 2 seems like a bad strategy, having one source to get that amount of supply. what are conversations about pivoting to alternative energy, having other forms of natural gas? i talked to a ceo last week and he was in discussions with europe to have long-term contracts. what are you hearing? isis: long-term contracts will be back in the game. a lot of people who over the past years five contracts by looking at this crisis, they can
say it will be nice to have long-term contracts. i think long-term contracts will be the name of the game. there will definitely be a trend towards that. there is little the european governments can do to intervene in a free market. there is not much they can overnight to decide that we are making a big decision and we are buying more gas despite the fact they sometimes do talk about it. guy: we will leave it there. if it is not tomorrow, maybe wednesday. isis will be telling us everything we need to know. a quick look at the final european numbers. a little bit of a coin toss in terms of what we were going to get. the ftse 100 a little lower as we have come through that option process and we finish negative there. the dax was down already. the stoxx 600, let me get the number for that, definitely
faded towards the end of the day and a little bit of a tick down during the auction. still finished positive. alix? alix: coming up we will continue the conversation on energy and gas. euro area finance ministers are meeting to discuss everything from the energy prices to the digital euro. we will talk to the austrian finance minister about all of that, next. this is bloomberg. ♪
alix: this is "the european close." coming up, lisa su, amd ceo at 5:00 in new york, 2:00 in san francisco. this is bloomberg. let's give you a check on bloomberg first word news. what's happening outside the world of business. president biden is facing pressure to discuss a surge in gasoline prices. officials will be looking at new
energy data as a guidepost. opec-plus has ignored requests from some of the world's biggest oil consumers, including the u.s., japan, and india to produce applied to compete with demand. china's growth has exceeded analyst estimates for three straight months, with a trade surplus -- official data showed exports data 27% from a year earlier and it rose less than expected. china's economy has slowed sharply. you have sporadic cobit outbreaks dragging on growth. european finance ministers are set to discuss the recovery post-pandemic. on the agenda, energy prices. wall street three main industries locked up records last week. optimism continues to be held back by worries about inflation, considering an uptick in demand and a spike in energy prices and supply chain snarls.
global news 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. -- that is your bloomberg first word news. guy: excellent work. alix steel. alix: cold read. guy: two of those stories merge together. you did fantastic work separating the two. let's talk about what is happening with the story alix read. the penultimate story about the eu today. eu finance ministers gathering, they have been talking about prices of energy, they are talking about spiking inflationary pressures, they will talk about what is happening with covid cases. austria imposing more strict rules in terms of covid passports. then we have the baker story with the eu's desire to return
to pre-pandemic budget rules. at the forefront of the argument on the side of saying we need to return to those strict rules is austrian finance minister gernot blumel. he joins us now to talk about what is happening. so much to talk about, minister. can i start with these budget rules? there does seem to be an expectation europe will be moving towards a different set of rules, a more flexible set of rules. you do not necessarily agree with that. i wonder how much progress you are making in terms of convincing your colleagues that is the way to go, and i am also wondering whether or not you think if we do see the next german finance minister being christian lintner, you feel he will support your position and put germany in your camp? min. blumel: many questions. thanks for having me. a lot to discuss.
on the growth and stability package, which is the basic framework for european fiscal stability, it insured growth and stability. that is exactly what it should have done. we should proceed allowing those rewards to ensure growth and stability in the future. during the coronavirus crisis, we had the necessity of high flexibility putting money into the economy and the framework as it exists today proves to be flexible enough to make this possible. now we have a debate i do not understand because some countries say we have the higher deficits, we have the higher debt to gdp ratio, let's get rid of those rules, saying they should come back to a sound fiscal situation.
i do not understand it. we need to apply those rules possible -- properly because we have to prepare for the next crisis. in the next crisis we will need a fiscal space to help companies and people. guy: have you spoken to christian lintner about this? do you think he supports your position? you have a meeting of minds when it comes to this? min. blumel: generally the situation in germany is being negotiated at the moment. from my point of view, from all the possible candidates at the moment, i think christian lintner would be a good minister of finance because he would ensure the future of new rules and that is good for everybody. it ensures the growth and stability and wealth of the past and it will do so in the future
if we get back properly. alix: is alix steel from washington, d.c. it feels like the next crisis is already here it is the climate crisis. how do you sulfur the climate crisis and go back to the budget caps? min. blumel: i can tell you what we did in austria. we have just negotiated a budget for next year. we introduced co2 pricing, which defines a clear price path towards the future, ensuring co2 is getting more expensive so the markets will switch to a more sustainable green way of doing business. i think that is important for the future. at the same time i do not think all of those investments can be done by the states. therefore i do not think it is
necessary to increase debt ceilings. most of those investors will have to come from private sectors. if we want to ensure this transition of our economy, there are incentives for private companies with private money to get into green assets. it will not be possible to finance this transition by debts that will lead to high debt burdens and flexibility of the next crisis will come. guy: you talked about returning to the pre-pandemic growth and stability pact. are we post-pandemic right now? i see your country this morning imposing new covid passport rules. i have french children going back into class wearing masks. we are seeing a resumption of covid cases climbing in many parts of the region.
what kind of story do you think europe should be expecting this winter, both from a covid point of view and from the economic impact that will have? min. blumel: it is a tricky situation. we have the highest growth perspective we have had for near 40 years in austria. nearly 5% next year. we have a shortage in so many open jobs at the moment in austria that companies cannot grow because there are too little employees. we have high demand with prices rising. all of this comes from a booming economy. at the same time we have raising infection rates and we have to implement additional measures to
incentivize people getting their vaccinations to ensure we will keep up the growth rate over the winter season. there is some concern this will increase demand, but this is to be observed. we have to ensure we have a good winter season. if you ever come to an austrian winter you can go skiing and i hope you do so. in the spare time tourism is accounting for 50% of gdp. winter season is important for us. i think it is good we implement additional incentives for people to get their jabs. alix: it feels like the demand-side, from your point of view, might hold up. talk about the supply-side? how do you think europe should solve for the spite and energy prices and natural gas prices? what you europe's strategy be --
what should europe's strategy be? min. blumel: it is a double-edged situation. we have to ensure co2 emissions are going down, which is mainly done by emissions, which means increasing prices on energy. on fossil fuels. to a certain extent, states are driving those costs. on the others, we have to ensure people can afford heating in winter. when i take a look over the european development of energy prices, i can see in some countries like spain or france, there is still a highly regulated energy market of price. in austria it is rising, but it is not a big problem at the moment. what we have done is to implement in our co2 pricing
scheme and inflation break, meaning if energy prices are rising over a certain percentage , then we will not implement the full increase of pricing for the next year. also if energy prices are falling, we will increase the co2 pricing. to make sure there is some kind of an inflation break on energy prices. alix: thanks a lot. gernot blumel, austria's finance minister, pleasure to speak with you. thank you very much. this is bloomberg. ♪
have another all-time high, the best winning streak back to 2017. behind it the industrials and materials strong. you can see caterpillar up 3.7%. we also have materials up sharply. united rentals putting in a new all-time high. copper inside of everything that needs to be made relative to roads and infrastructure buildings. not surprisingly, we will see big outperformance for the materials sector. up relative to the s&p 500. strength, strength for anything that has to do with construction. alix: interesting because it shows that good news was not baked in no matter how long we've been talking about it. let's take a look at what is happening the next 24 hours. a lot of fed speakers today. also three-year notes, sale of
$56 billion. $120 billion over this week. that will be fun. guy: richard clarida suggesting maybe you do get a rate hike next year. tomorrow we have a conference on diversity. chair powell will be there. that will be worth paying attention to. e.u. finance ministers our meeting. a hearing from the austrian finance minister. work on ppi followed by cpi on wednesday. alix: looking forward to that. you have elaine chao joining "balance of power" with david westin. this is bloomberg. ♪
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westin. ♪ david: from bloomberg's world headquarters in new york to our tv and radio audiences worldwide, welcome to "balance of power." we begin at the white house, where president biden is turning from celebration over the passage of the infrastructure built late in the night on friday to selling the plan to the american people. we welcome washington correspondent joe mathieu, host of "sound on" weekdays on bloomberg radio. tell us about the sales job the president is setting up for himself. joe: you can think of it as two different sales jobs. one is reminding people what happened friday night. passing the biggest investment ever in american infrastructure. not the