BI Weekend: Measles Outbreak, US Clean Tech

Summary

Bloomberg Intelligence Podcast: “Measles Outbreak, US Clean Tech”

Date: March 21, 2025
Hosts: Alix Steel & Paul Sweeney

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Episode Overview

This episode of Bloomberg Intelligence delivers in-depth analysis on key market-moving stories, with a focus on the U.S. measles outbreak, the shifting global landscape in healthcare, semiconductor and auto industries, as well as the significant impact of President Trump’s America First policy on U.S. cleantech. The hosts leverage Bloomberg’s vast research arsenal, calling on sector-specific analysts and reporters for real-time insight on hot-button topics ranging from the latest pharma innovations to global trade and investment policy risks.

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Key Discussion Points & Insights

1. US Measles Outbreak & Vaccine Immunity

Guests: Sam Fazeli – Bloomberg Intelligence Director of Research, Pharmaceuticals

• Spike in Measles Cases: Just three months into 2025, reported U.S. measles cases have already surpassed the previous year's total. The severity varies regionally, with Texas cited as a major hotspot. [02:24]
• Immunity & Vaccine Booster Guidance: Fazeli, referencing his own precautions, noted:

  “Do we all need to take [a booster]? I don't think so at the minute. …If you were vaccinated, especially post-1968, which is all of you guys, right. You would be immune.” (Sam Fazeli, 03:09)

  • Most vaccines administered after 1968 offer long-lasting immunity.
  • Fazeli recommends confirming immune status, especially for those in contact with vulnerable populations.
• Herd Immunity Concerns:

  “We need 95% immunity around us to benefit from the herd immunity effect… in some states in the US it’s falling below that.” (Sam Fazeli, 03:35)

  • Only 12–13 states are above the 95% vaccination level, increasing risk of outbreaks in under-vaccinated regions.

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2. Pharmaceutical Industry & NIH Funding Cuts

• Big Pharma Moves: Roche and Zealand landed a $5.3B licensing deal to challenge giants in the obesity drug market, focusing on an amylin-based product designed to preserve muscle mass while aiding weight loss. [04:32]
• Impact of NIH Funding Cuts:
  • Ongoing federal cuts create uncertainty and threaten the future of drug development.

  “It’s not just about cutting people, it’s the uncertainty that it creates.” (Sam Fazeli, 06:15)

  • Fazeli highlights reduced patent activity and staff; calls for policy change to protect scientific innovation.

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3. Health Insurance Chaos – The Patient’s Plight

Guest: John Tozzi – Bloomberg Healthcare Reporter

• Administrative Gridlock: A patient in Wisconsin, denied and approved for breast cancer treatment by UnitedHealthcare on the same day, ultimately received coverage only after litigation and press attention. [07:43–08:43]

  “This story really exemplifies…what an administrative mess the U.S. health care system has become.” (John Tozzi, 08:43)

• Escalating Denials & Financial Burdens:
  • Rising denials put patients in adversarial positions between providers and insurers.

  “We have this adversarial system…patients are often caught in the middle.” (John Tozzi, 09:11)

  • The system spends as much on billing as it does treating cancer.
• Doctors’ Flight to Employment:
  • Physician independence is dwindling as 75% now work for hospitals or corporations (up from 60% in 2019).

  “The days of just hanging your shingle…being a solo practitioner, those are over.” (John Tozzi, 11:21)

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4. Tesla, Elon Musk and the Trump White House

Guest: Liam Denning – Bloomberg Opinion Columnist

• Trump-Musk Dynamics:
  • Musk’s close relationship with President Trump continues, despite previous predictions of a short alliance.

  “You have these two big egos…They both still get quite a lot from this relationship.” (Liam Denning, 16:20)

  • Trump gains campaign dollars and social media alignment; Musk gets White House access and regulatory influence.
• Tesla’s Market & Brand Impact:
  • Tesla’s value and sales are suffering, especially in Europe, China, and blue-state U.S. markets such as California. [17:57–19:45]
  • Musk’s alignment with Trump may have longer-term reputational damage, especially if political winds shift.

  “As that price comes down, it does tarnish Musk’s image…it also points to…lasting damage if this relationship…were to unravel.” (Liam Denning, 19:45)

• Grassroots Backlash:
  • Even in progressive enclaves, symbolic protests are emerging (e.g., “Sell your Tesla” leaflets in Brooklyn). [20:24]

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5. Dark Pools and the Opacity of Equity Trading

Guest: Catherine Doherty – Bloomberg Finance Reporter

• Rise of Private Rooms within Dark Pools:
  • Off-exchange trading (“dark pools”) now accounts for over 50% of equity volume; segmentation into private rooms enables firms to select trading counterparties, further obscuring market activity. [22:28]

  “You can think about it as the darker version of the dark pool.” (Catherine Doherty, 23:15)

• Pros and Cons:
  • Benefit: Specificity—tailored trading, better execution assurances for large blocks (especially for partner-focused groups, e.g., minority-owned brokerages). [24:16–25:46]
  • Risk: Potentially less liquidity and more market fragmentation as the trend grows, but currently less than 10% of dark pool trades.
• Relationship-Driven Industry:

  “Relationships are still the name of the game.” (Catherine Doherty, 27:42)

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6. U.S. Clean Tech and Trump’s America First Policy

Guest: Derek Flakel – BloombergNEF Lead U.S. Policy Analyst

• China’s Dominance & New U.S. Policy:
  • China-linked firms control a vast majority of the planned U.S. battery production; Trump’s new investment restrictions complicate U.S. access to crucial tech. [32:05]

  “While Trump wants reindustrialization…he’s actually making that more challenging.” (Derek Flakel, 32:34)

• Industry Impact:
  • Investment uncertainty is up; current rules allow for joint ventures, but oversight (CFIUS) and uncertainty loom large. [33:29]
• Allies & Partnerships:
  • Trump's policy creates confusion over which foreign partners are acceptable; many “friendly” companies (from Japan, Korea) have entangled relationships with China.
• U.S. Strengths & Weaknesses:
  • Battery and EV manufacturing are booming, but much of the supply chain remains internationally linked.
  • U.S.-origin technologies (e.g., geothermal, oil/gas spin-offs) are advancing but aren’t primary energy transition drivers—yet. [36:33]
• Macro Outlook:
  • Only two months into the Trump administration, uncertainty is high, with unclear long-term policy direction for green and clean tech. [37:20–38:29]

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7. China’s Growing Auto Industry

Guest: Chester Dawson – Bloomberg Senior Editor

• Global Share & Expansion:
  • While Chinese automakers currently hold just 3% of global market share, their footprint is exploding, especially in emerging markets where they sometimes capture 30% or even 75% (e.g., Russia). [38:53]
• Western Response:
  • U.S. & European automakers deploy protectionist tactics domestically but face stiff competition abroad.

  “Much of the rest of the world…the Chinese are making really impressive headroads.” (Chester Dawson, 39:51)

• Displacement vs. Market Growth:
  • In markets like Thailand, Chinese brands are crowding out established Japanese automakers; in other regions, the market (the “pie”) is growing, but the share is shifting dramatically toward China. [41:05]
• Quality Leap:
  • The longstanding perception that Chinese cars are subpar is outdated; like Japan in the '70s and '80s, China’s vehicles are now technologically advanced—sometimes leading in connectivity and comfort.

  “[Chinese automakers] have caught up—and in some cases even surpassed—the technology that some of the Western or Japanese automakers have.” (Chester Dawson, 42:11)

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Memorable Quotes & Moments

• Sam Fazeli on Vaccines:
  “If you were vaccinate, especially post 1968, which is all of you guys, right. You would be immune...that’s one of those vaccines that works for a long, long time.” [03:09]

• John Tozzi on Insurance:
  “The U.S. healthcare system spends as much on billing and claims processing as it does on treating cancer…” [08:43]

• Liam Denning on Musk-Trump Relationship:
  “You have these two big egos and they're bound to kind of explode in some kind of supernova at some point. I think we do have to consider that they both still get quite a lot from this relationship.” [16:20]

• Catherine Doherty on Dark Pools:
  “So in many ways, you can think about it as the darker version of the dark pool.” [23:15] “Relationships are still the name of the game.” [27:42]

• Derek Flakel on Clean Tech:
  “While Trump wants reindustrialization and reinvestment in the US…he’s actually making that more challenging.” [32:34]

• Chester Dawson on China’s Auto Rise:
  “You're finding that not only are Chinese cars cheaper, but oftentimes they have just as many creature comforts or sometimes more than the equivalent, say GM or Toyota or Volkswagen.” [42:11]

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Timestamps for Key Segments

• US Measles Outbreak & Immunity – 02:24 to 04:32
• Pharma Industry & NIH Funding – 04:32 to 07:20
• Insurance Chaos – Patient Experience – 07:36 to 13:29
• Tesla/Musk & Trump White House – 15:58 to 21:58
• Dark Pools & Private Markets Explained – 22:01 to 27:45
• Trump's Impact on US Clean Tech – 31:54 to 38:29
• China’s Surge in Global Auto Markets – 38:33 to 43:08

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Tone & Style

The hosts maintain a brisk, analytical, and often conversational tone. They press guests for direct insight and practical consequences, while sometimes injecting humor and skepticism—particularly about the opacity of Wall Street or the ego dynamics in the Musk-Trump relationship. The episode balances high-level policy impacts with concrete industry examples, making it relevant for both investors and broader business listeners.

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This summary covers the full scope of Bloomberg Intelligence’s March 21, 2025 episode—providing a comprehensive briefing for anyone who hasn’t listened but wants to understand the business, policy, and investment implications now shaping health, energy, and the global auto market.

Transcript

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[A]

Bloomberg Audio Studios podcasts Radio News this is Bloomberg Intelligence with Alix Steel and Paul Sweeney.

[B]

The real Our performance has been US Corporate high yield.

[D]

Are the companies lean enough? Have they trimmed all the fat?

[B]

The semiconductor business is a really cyclical.

[A]

Business, breaking market headlines and corporate news from across the globe.

[D]

Do investors like the M and A that we've seen?

[B]

These are two big time blue chip.

[D]

Companies window between the peak and cut, changing super fast.

[A]

Bloomberg Intelligence with Alix Steel and Paul.

[B]

Sweeney on Bloomberg Radio on today's Bloomberg Intelligence show, we dig inside the big business stories impacting Wall street and the markets.

[D]

Each and every week we provide in depth research and data on some of the 2000 companies and 130 industries our analysts cover worldwide.

[B]

Today we'll discuss Tesla CEO Elon Musk relationship with President Donald Trump.

[D]

Plus, we'll look at the consequences of President Trump's America first investment policy on the U.S. energy landscape.

[B]

But first, we begin in the health and pharmaceutical space.

[D]

Less than three full months into 2025, the US measles cases have outpaced last year's total, and this comes as the worrying outbreak linked to multiple deaths continues to spread.

[B]

In other news, the Drug makers Roche and Zelin teamed up in a $5.3 billion pact in a bid to challenge Novo Nordisk and Eli Lilly in the booming market for obesity drugs.

[D]

For more, we are joined by Sam Fazeli, Bloomberg Intelligence Director of research for Global Industries and Senior Pharmaceuticals.

[B]

We first asked Sam about his immune status and how concerned we should be about getting a measle vaccine booster.

[E]

It's not like it's rampant and everywhere, but the reality is it worried me enough being all those labels you want to give me. Right. That I thought, let me go and see what my, my immune status is.

[D]

I'm doing that.

[E]

Right.

[D]

I have my blood test in a couple weeks because, like, why not?

[E]

Right? Yeah, I just, you know, so exactly what have you got to lose? At least I know, I know that if I am susceptible and I've got a little grandson, I think about being close to him or not, et cetera, et cetera. So I did that. So I think, do we need all to take it? I don't think so at the minute. I don't think this is something everybody needs to rush out and get. Majority of people, if you were vaccinate, especially post 1968, which is all of you guys, right. You would be immune to, you know, that's a very. One of those vaccines that works for a long, long time. So. And I think my result actually says I am immune, so I shouldn't worry about it. And that's where we need to be. The problem is we need 95% immunity around us to, to benefit from the herd immunity effect. Remember that during the pandemic we talked about that. Yeah. And that's the problem, that in some states in the US is falling below that. In fact, I counted only 12 or 13 states, you can count that on the CDC website, that are above the 95% vaccination level. So those who are below have a risk of outbreaks. And that's why we've been seeing that rate rising and infection rates have been rising since 2017. 18. There's always some. But we're dealing unfortunately with a pretty meaningful sized outbreak in Texas.

[B]

So deals last week, Roche and New Zealand getting in on a deal. What's happening with our good friends?

[E]

Yeah, yeah. So look, I mean, we only got two things to talk about here. Infectious diseases or obesity. Right. And this deal, this deal was a licensing deal, not M and A. So basically Roche went to this company and said, look, we're interested in your asset and we want to do a partnership. So Roche has taken on 50 50. Up to 50. 50 that is Zealand can invest in the commercialization up to a point of getting 50% profits, assuming they put in 50% of the costs. Right. So. And what is it? Is it another WeGovy? Is it another zip down? No, it's not. It's a different mechanism and it's supposed to work by giving you weight loss, but helping preserve some of the muscle mass, which I'm sure you've talked about this, or we've talked about this several times. You don't want to lose muscle and fat. You want to lose fat, less muscle. And that's what these amylin drugs potentially give you. And of course, Roche is no newcomer to this space. Right. But interestingly, what it does pose is in the future that we're going to be looking at you and I and Alex together, I'm sure we'll be talking about this forever is how do you decide what to give to what patient? That's what the world needs to figure out now.

[D]

Yeah, I don't know what the answer is to that. I'm sure the companies all have their own answer.

[E]

I'm coming back to you, Alex, to figure it out.

[D]

Okay, I believe you. When we take a look at the in the US and the level of NIH funding that is on the chopping block, what part of the industry do you think is most vulnerable to losing funding and then missing out on some research?

[E]

Yeah, but so Alex, if you think about nih, it's, it's mostly. Majority of it, of course, is biological. Right. National Institutes health. So that's where I think the cuts are coming. But it's not just about cutting people. It's the uncertainty that it creates. It's been the cutting of overhead costs to universities. It is the fact that apparently there have been. No, not based on what I've been looking at, but based on what I've heard, there have been no patent filings by the institute in the past few weeks, which could be stop filing patents because it's expensive or could be we don't want to give all our ideas away or whatever. But they are the fund or found or whatever the right phrase is, sorry, of future drug development and they get lots of revenue back from it. So it is, it is worrying and I don't like seeing what I'm seeing. Up to 20% of the staff being cut and we need, we need a turn in this. We need to stop seeing this and so that we don't feel like science is under attack.

[B]

Our thanks to Sam Fazeli Bloomberg Intelligence, Director of Research for Global Industries and senior Pharmaceuticals Analyst.

[D]

This week we focus on a few Bloomberg Big Take stories and one was titled Cancer Patients $100,000 bill shows chaos Rocking Health Care. You can find it on bloomberg.com and the Terminal.

[B]

The story focuses on the insurance industry, their rise in denials and one woman's fight to get coverage for her cancer treatment.

[D]

For more, we spoke to John Tazi, Bloomberg Health care reporter. And we first asked John to walk us through his story in the broader health care insurance industry.

[F]

This is a story of a woman who was being treat for advanced breast cancer in Wisconsin and she sought prior authorization from her insurance company, UnitedHealthcare for the treatment. She got a kind of confusing set of responses. She got two letters on the same day, one denying the authorization, another approving it. She got the treatment months later. The company declined to pay for it. She ended up filing a lawsuit to get the treatment paid for. The company ultimately did pay for it after the lawsuit was filed, after we inquired about it. But you know, what this story really exemplifies is kind of what an administrative mess the U.S. health care system has become.

[B]

So I mean, you've got a stat in here which is just blows me away. The US Health care system spends as much on billing and claims processing as it does on treating cancer. That is just extraordinary because what you have here as reading your story, you got two big entities locking horns all the time. The, the provider of this, of the, the medical procedure and then the insurance company that has to pay for it. Neither of them are, you know, wallflowers. They go at it, don't they?

[F]

Yeah. So what we have is this adversarial system, right? You have on one side, you know, hospitals, medical providers, labs. You know, we're in a free market economy where there's no restrictions on the prices they can charge. On the other side, we have the private insurers who are, you know, trying to constrain costs for their clients and you know, make sure that the care given to their members and is appropriate care. And you know, it's just this conflict and it's escalating. You know, we see data on insurance denials rising. We see a bunch of basically companies that have gotten into this system to help one side or the other or in some cases both maximize their financial advantage in these transactions. So you have this sort of escalating conflict that patients are often caught in the middle of.

[D]

So what's our way out of here?

[F]

Good question. I mean, I think, you know, some people would argue that there is, you know, opportunities for technology and AI and, you know, more efficient processes, standardized, like.

[D]

Technically standardized practices or something.

[F]

You know, I mean, I think that would potentially go a long way. I mean, there's been a lot of research over a long time over, you know, over kind of how to do this. I think what you fundamentally get, though, is like the system where incentives are, you know, are misaligned. Like, you have one side that has an incentive to do more and to build more, and you have another inside that has incentives to kind of put up more restrictions or guardrails, they might call it, around, around care. And, you know, that's sort of increasing, and I'm not sure that there's sort of a clear pathway out of it right now.

[B]

Well, one of my questions is what does this mean for health care providers? It kind of. I mean, and you've got a great chart in here. U.S. doctors no longer work for themselves. And it's the percent of physicians employed by hospitals or corporate entities. And that number was about 60% back in 2019. It's over 75% today. So our doctors are saying, I don't, I just can't deal with this stuff anymore.

[F]

Yeah, and I think if you talk to physicians, you hear, you know, there's a lot of compliance and sort of like, you know, investment they need to do in, like, over the recent years around, like, electronic medical records and, you know, basically being a practicing physician has gotten a lot more complicated and I think in some ways a lot more expensive. And the days of just kind of hanging your shingle when you get out of med school and being a solo practitioner, those are over. The other thing is that they're, you know, looking for bargaining power when they're contracting with the insurance companies. So they're joining hospital systems, they're joining big groups, they're joining private equity owned, you know, practices.

[D]

I guess the logical question also then becomes if there are tweaks to, like, entitlement programs too, like, how does that wind up affecting this whole dynamic? Because if there are changes to Medicaid and Medicare, I would assume that some providers will then lose money and then it makes it harder.

[F]

Yeah, I mean, I think, you know, we, we will still have to see what comes out of Washington on, on that front. But, you know, in general, I think providers will tell you that they have to charge higher prices in the private market because they are not compensated enough by government programs. I know there's a lot of dispute about that assertion as well from economists and, and others, but you know, it, you know, for patients, particularly in the commercial market where they, you know, if you're on Medicare or Medicaid, the government sets the price more or less. But if you're on a private plan, you know, those prices are set in the private market. And that's why when, you know, if you do have a situation where something isn't properly covered, you can be exposed to a really expensive bill.

[B]

Did your, did Julie Simons, the woman in your story, did she ever get any resolution with this lawsuit here?

[F]

So the claim was paid, you know, again, after she filed a lawsuit, after we asked the company about it. The claims were paid in there, you know, so, so that was resolved that the lawsuit is, you know, is still pending.

[B]

Okay, our thanks to John Tazi, Bloomberg health care reporter.

[D]

Coming up, we're going to look at Wall Street's infamous dark pools.

[B]

You're listening to Bloomberg Intelligence on Bloomberg Radio providing in depth research and data on 2000 companies and 130 industries. You can access Bloomberg Intelligence via B I go on the terminal. I'm Paul Sweeney.

[D]

And I'm Alix Steel and this is Bloomberg.

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[D]

Tesla CEO Elon Musk and his relationship with the Trump administration.

[B]

Tesla stock has been suffering since its gains on Election Day, and it shows that Musk's relationship with President Donald Trump is hurting his portfolio.

[D]

For more, we spoke to Liam Denning, Bloomberg opinion columnist, for his piece titled How Long Will Musk be Welcomed at the White House?

[B]

We first asked Liam if he is surprised that Elon Musk has lasted this long at the White House.

[G]

You know, not really. I mean, I know that there's this speculation that, you know, you've got these two big egos and they're bound to kind of explode in some kind of supernova at some point. I think we do have to consider that they both still get quite a lot from this relationship. I mean, you know, Elon Musk has the ear of the most powerful person in the world. He has through, through the doge, whatever that is. He has influence over all sorts of agencies that regulate or do business with his companies. And in return, you know, President Trump gets, gets to bask in the aura of this prominent businessman. He gets campaign dollars, you know, and he gets obviously, you know, should we say algorithmic alignment on a big social media platform. So there is still quite a line. But we have seen, you know, I think the reason I wrote the piece is we've seen a confluence of things that point to the risks of a business person like Elon Musk tying himself this closely to, you know, a pretty controversial president.

[B]

Yeah, Liam put me in the camp. I was one of those folks that said, you know, Elon will probably last. His tenure will be measured in weeks, not months or years. And it looks like, at least at this early stage, I may be proven wrong. But, you know, money talks here. According to Rich, go on the Bloomberg terminal, Musk's next net wealth is down $118.6 billion this year. Do you think he cares?

[G]

I think, you know, maybe on a kind of an ego level that matters. I mean, he's still worth, you know, the last time I looked something 313. So, you know, he's not, he's obviously not going to be struggling, but I think for me, you know, the big mover there is Tesla, obviously, because that's the, the biggest asset. It's the only really liquid has. You know, his own personal indebtedness is tied to that stock, and he used it, you know, to help buy Twitter. And I think it is, it is an issue, because I think what's been interesting for me with what's happened with Tesla since the election, you know, obviously there was that huge Trump bump in the stock, you know, worth north of $700 billion, which has collapsed. And in some ways I've sort of viewed that not just as a stock price, but as an opinion poll. You know, we saw this really enthusiastic response, you know, based around honestly, pretty nebulous ideas that the Musk's closeness to Trump would somehow translate into, say, like, you know, favorable autonomous driving legislation or something. But when you unpacked it, there wasn't really a whole lot there. Mainly because, you know, the big problem there is it's not government regulations. The fact that Tesla still doesn't have a commercial robotaxi, like that is the main problem. And in the meantime, we've seen the corrosive effects of that relationship. You know, clearly the Tesla brand is suffering in major markets. We've seen bad numbers out of Europe, we've seen bad numbers out of China, although that may have less to do with politics and more just with straight up tissue. And we've seen weakness in California, the big U.S. eV market building through 2024. And I honestly don't expect that the past couple of months have helped with sales there either. And I think as that price comes down, it does tarnish Musk's image, it does affect him financially, and it also points to, I think, lasting damage if this relationship with Trump were to unravel in the same way we've seen with businessmen previously.

[D]

So I live in Parksville, Brooklyn. I think Liam does too. But have you seen the Tesla's?

[G]

I do not.

[D]

You do not? But you live in Brooklyn.

[G]

Right now I'm in the suburbs.

[D]

Oh, he changed. Okay, he was in Brooklyn at one point. But my point of this whole conversation is in yuppie Brooklyn, there are Teslas parked on the street. And I noticed for the first time there were signs like leaflets being put on the windshield being like, sell your Tesla with like a picture of Elon Musk. Because, like, that's where the protest is, like, only, only in Parkslow. Would that actually happen? Does Musk also provide a foil for Donald Trump in terms of like, Musk gets the heat, Trump doesn't.

[G]

Yeah. And, you know, I think my read of the way Musk was brought into government in this kind of, you know, kind of slightly arm's length, quasi independent role was that that gave him a lot of freedom of, of movement to act. It also meant he obviously avoided some of the more onerous kind of Senate hearings and that kind of thing. But I think it also gives Trump some useful distance if at some point we were to see, you know, some real blowback against, I don't know, you know, cuts to entitlements or if we see, you know, if we see a recession happen. We've seen Trump, you know, very quickly, you know, lose patience with some of these people he's brought in before. You know, I'm thinking of people like the former Exxon CEO Rex Tillerson in the first term, Gary Keim from Goldman Sachs. Musk is in a different league, but he's also very close. He's not, you know, this is a whole new level of embrace between a prominent business person and the White House.

[D]

Our thanks to Liam Denning, Bloomberg opinion columnist.

[B]

One Bloomberg Big take story we focused on this week was titled Wall Street's Private Rooms Are Making Dark Pools Even Darker. You can find it on the bloomberg.com and the terminal.

[D]

The story focuses on how Wall Street's dark pools are becoming even more opaque with the introduction of private rooms.

[B]

These rooms allow firms to control who they trade with and the ability to hide big equity deals from impacting prices.

[D]

For more, we are joined by Catherine Doherty, Bloomberg finance reporter. We first asked Catherine to remind us what dark pools even are.

[H]

So the name is Nefarious. It sounds like there's something evil going on, but all it really is is trying to show is the trading that is happening off the large exchanges that are the lit venues that you see the, the trading and all the activity happening in real time. The trading that happens off the New York Stock Exchange, off nasdaq, in these alternative trading systems, those are the proverbial dark pools. So the trend that I've been tracking is this introd in the last few years of private rooms. And all this is, is segmented. It's the ability to choose who you're interacting with and where within these dark pools. So in many ways you can think about it as the darker version of the dark pool.

[B]

What percentage of volume and equity volume is in dark pools? Broadly defined.

[H]

So for the first time off Exchange trading in dark pools has actually surpassed 50%. So it's become the majority and that was by the end of last year. So that's another significant trend. Trend, the percentage of private room trading, that's the big question mark. Because these alternative trading systems don't need to break out the volumes within their private rooms. They disclose that they have private rooms, but the number of private rooms and how much volume is actually happening trading within them, that is not disclosed. So it's a big question mark. And when you're trading on an alternative trading system, you may have access to 90% of the liquidity within this pool because all of the trading that happens within a private room you may not have access to.

[D]

So okay, so what are the pros and cons? So clearly not having access to liquidity would be a con, right? Or not knowing what all the liquidity is. What's the pro here?

[H]

So the users of these private rooms, the benefit that they cite is the specificity of who you're interacting with. It can provide certainty in terms of the quality of trading that you're looking for. So if I say I want to interact with Alex because I know Alex is going to give me the best execution and I'm going to get the best price for a certain order. This could be because I know that you, Alex, can fulfill a certain size order or maybe it's the speed at which I need to fill this order. If I know that there's a particular either firm or number of firms, it could be multiple firms in one private room. That certainty can actually be quite comforting for a broker that's trying to fulfill on behalf of their investor client a big order that they don't want to send to a public stock exchange.

[B]

An investor order comes in, well, all right, I'm the buy side client. A I want to go to a private room. Do I go through my broker dealer, whether it's Goldman Sachs or Morgan Stanley and they get me into the private room or do I go directly into the private room?

[H]

So if you either are the investor, you're just sending your order and your broker's executing, it's up to the broker and many times it's the brokers algos that actually have these private rooms set and they in an automated process it might go straight to the private room within the alternative trading system or it could go to the exchange. It all depends on again, the size of the trade, the speed, really what you're trying to do, what is your end game, what is your goal?

[D]

So if I don't have access though. Am I losing out? Like if I'm just trading on the regular old nicey like am I losing speed or money or trade or is it just different?

[H]

So it's the big question mark. One of the firms that I profiled in my story today is a minority owned broker dealer and they specifically are looking to interact with other minority broker dealers. So there is a room set up with only minority owned broker dealers. So that use case is very specific. Obviously if you're not a minority owned broker dealer, you may not be invited into that room. And whether or not that is a big con, whether or not those trades that you don't have access to are going to impact your experience, it's still a very small sliver of the market. The ats, the firms that are running these off exchange venues that I talk to in trying to understand the actual volumes that are happening within these private rooms, it's very small. It's. Some of them are citing 5%. It's less than 10% overall. So when you think about the, the bigger picture here, it's not as if you're losing out on half of the trading that is occurring off exchange. By no means. The question becomes as this trend grows and we are seeing it pick up momentum, will it then start to impact the trading experience? And, and then some of your questions that you're bringing up, Alex, those will need to be asked and hopefully answered over time.

[B]

A big part of my job was taking the sales trader from alliance out for drinks at night. I guess we don't do that anymore.

[D]

Don't. You can still do that?

[B]

I don't know. They're in a dark pool. I don't know who's who. I don't know what's going on. I could just walk across the street. Street. My guide, alliance big account, take them out for drinks. Boom.

[H]

The relationships and the drinks, they still do matter. So maybe you're going out for a.

[D]

Drink with someone finds in your private rooms. It's true.

[B]

I don't. That was a big part of my game back in the day.

[H]

No relationships. Relationships are still the name of the game.

[B]

Our thanks to Katherine Doherty, Bloomberg finance reporter.

[D]

Coming up on the program, a look at how China is on the verge of taking over the auto industry.

[B]

You're listening to Bloomberg Intelligence on Bloomberg Radio providing in depth research and data on 2000 companies and 100 industries. You can access Bloomberg Intelligence via BI. Go on the terminal. I'm Paul Sweeney.

[D]

And I'm Alix Steel and this is Bloomberg.

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[D]

At research from Bloomberg NEF, previously known as New Energy Finance. They're the team at Bloomberg that tracks and analyzes the energy transition from commodities to power, transport industries, buildings and ag sector.

[B]

This week we looked at the consequence of President Donald Trump's America first investment policy on the US energy landscape.

[D]

For instance, 111% of planned US battery production is controlled by China linked firms, and Trump's policy makes it harder for Chinese firms to invest in the U.S.

[B]

As a result, efforts to scale domestic clean tech manufacturing may be hindered. For more, we were joined by Derek Fleckel, BNEF Lead U.S. policy Analyst.

[D]

We first asked Derek to break down how President Trump's new policies on investment differ from the Biden administration.

[I]

A lot of the Biden administration's policy was an attempt to sort of catch up with that investment and technological edge that China has, or at least compete with it better. But the Trump administration has imposed a new policy that might make that a little bit more complicated. When you have firms like BYD or Goshen in the battery space that are sort of the technological leaders in this area, you might think it might benefit the U.S. economy to have some additional investment from those companies, have some technology transfer that comes along with that. But Trump recently passed an America first investment policy which is designed to make that more difficult due to the sort of growing bipartisan security concerns around China. There's a bit of a trade off here. While Trump wants reindustrialization and reinvestment in the US at one point he suggested that Chinese factories might set up in the US rather than Mexico. What he's actually doing in practice is making that more challenging.

[B]

So what is the solution here for investment? What are the American companies saying about their ability to meet demands within the clean tech food chain here in the us?

[I]

Well, I think classically there's always a bit of a division between who you're talking with, import competing industries versus import reliant industries. But a lot of the factories in the US that are setting up in practice, these are the sort of end of the food chain. We're talking assembling solar modules from imported ingots and wafers, or assembling EVs from some degree of imported parts, although the EV supply chain is rather more domestic, so. So depending on which part of the industry you're talking about, they're going to be looking positively or negatively at this order. That said, it's important to note that current rules still allow joint ventures and licensing deals. Some companies, like Ford, were counting on using those kinds of deals to try and build up their own technological edge and compete better. So I think there is an understanding that companies want investment. They want a clean, predictable environment. To some extent, this order does try to answer those concerns by making it it easier to mitigate against some of the foreign investment concerns that are regulated by, say, the Committee in foreign investment in the U.S. cFIUS. But at the end of the day, I think this is one additional element of uncertainty and one that's increasingly defined by uncertainty.

[D]

If, if clean tech wasn't a word, if it was just like tech, would this be different? Or is the fact that the words clean on it changes the dynamic?

[I]

I think you've seen broader sort of concerns in the government community about Chinese investments. Certainly you hear about that in, in chips, anything cybersecurity related. Technically speaking, a major trade barrier is the connected cars rule that the Biden administration imposed saying no cars with Chinese navigational or connectivity software can be sold in the US market after 2026. So I think the fact that energy is a sort of critical sector and is specifically called out as such in this order makes it especially sensitive. But there's a variety of other strategic sectors where these sensitivities also apply.

[B]

And Derek, I guess the reality though is that the Chinese in fact are way ahead of the rest of the world in terms of technology. So that makes it even more difficult. What's the solution there?

[I]

Well, something the order tries to do is compensate for that by making it easier for unspecified US allies and partners to invest in the us. This could include Say Japan and Korea, which are some of the other leaders in the sector. But as at the same time, that's complicated by the fact that one, there's no current list of allies and partners and right now all those traditional alliances and partnerships are complicated by the trade war. And two, there's not a specific set of circumstances under which those allies and partners can get a guarantee that they'll be allowed in. It specifically says that if there's partnerships with Chinese companies by these US Allied and partner companies, then that could complicate their investment climate. And, and since places like Panasonic or AEC from Japan or SK on LG Energy solution from Korea, they have commercial relationships in China. Right. Maybe that's supply chain, maybe that's consumption, and it's not totally clear which of those relationships would be considered prejudicial to their getting permission to set up in.

[D]

The U.S. hey Derek, what areas of the clean tech area, space is the US doing well in and investing the right kind of money and like the sectors developing?

[I]

Right. I think that's a great question. I think first of all, you can sort of separate deployment and manufacturing. Deployment wise, we're seeing an absolute boom in battery installations. Solar installations, things like wind are a little bit more affected by interest rates, uncertainty, things like that. On the supply chain side, there's definitely been a huge boom in battery manufacturing and related EV investments. But as we mentioned, there's a lot of sort of foreign involvement in those supply chains which could be a little bit impacted by this. Lastly, I think there are some US grown technologies, especially those related to sort of spin offs of oil and gas drilling for VO Energy and geothermal use. A lot of those techniques for geothermal drilling, those are doing fairly well, but they're earlier on and they're not necessarily as determinative of progress in the energy transition right now as some of these traditional legacy technologies.

[B]

Hey Derek, we're only two months into the second Trump administration, but is there any consensus in your world of policy as to whether this administration is going to be helpful or not helpful as it relates to, you know, economic policy in green?

[I]

I think if we're talking about economic policy with respect to clean energy, I think that you have to look at the sort of broader macroeconomic uncertainties surrounding tariffs, the impacts on interest rates. I think that creates a bit of a cloud under all kinds of capital intensive investments. At the same time, there's been a strong focus on all of the above energy strategy, trying to support the datacenter buildout. And while the actions so far have concentrated heavily on oil and gas and related infrastructure, fossil fuel power plants. There is sort of the inkling or political room for continued support of supply expansion by all means, which based on the sort of interconnection key use, the big expect expected load growth from data centers and more seems reasonably likely. However, it is only two months in and I think we've really got to wait to see how this situation develops in which factions in the Trump administration are more dominant in the longer run.

[D]

Our thanks to Derek Flakel, Bloomberg BNEF Lead US Policy Analyst.

[B]

One Bloomberg Big Take story we focused on this week was entitled China's Auto Industry is Already Taking over the World. You can find it on bloomberg.com and the Terminal.

[D]

The story looks at how China is on the verge of taking over the auto industry from its rise in electric vehicles. For more, we spoke with Chester Dawson, Bloomberg Senior Editor.

[B]

We first asked Chester about how much of the global auto market China has.

[J]

Right now it's starting from a very small base, but it's growing very rapidly. So it's it's basically about 3%, but it's forecast to grow by leaps and bounds over the next few years. And it's really amazing when you look at particular markets where they have a 30% share, like in Chile or in Russia, where for obvious reasons most of the competition is pulled out, they've got over three quarters of the market. So those are obviously, you know, kind of outlier examples. But slowly yet surely, almost everywhere around the globe, particular particularly in emerging markets, the Chinese are gaining more market share, gaining momentum and often undercutting the more established rivals. Obviously the big exception there is the US but elsewhere you're seeing tremendous growth.

[B]

So what has been the response by the Western auto manufacturers? I'm thinking the Volkswagens and the Fords of the world. What are they doing or how are they responding to this growth by China?

[J]

Well, it's really twofold in their home markets, obviously they've sought protection by lobbying for various protectionist barriers. In many cases, the argument is, hey, we just need a few years of breathing room till we can get up to speed and have a more competitive product. But, but we've kind of seen how that works historically and it's not always a silver bullet outside of the industrialized world because Canada and even the EU has been drawing up the drawbridge a bit for Chinese made vehicles. But you know, in much of the rest of the world where growth is often fastest, the Chinese are making really impressive headroads and the, you know, established Automakers are not sitting on their hands. They're, you know, they're often trying to beat the Chinese on price or you know, use their better brand name recognition and credibility and often and sometimes working with local dealers to pressure governments in places like say Brazil to throw up their own barriers that blunt some of the inroads being made by Chinese.

[D]

This would be a silly question, but are Chinese carmakers displacing European and US Carmakers or is this like expanding general auto market share?

[J]

You know, that's a really good question. I think it's both. I mean, you're not seeing growth so fast that the pie is expanding to the point where everybody is getting a bit of it. You are seeing erosion. It's not true everywhere, but take Thailand. That's a perfect example of where that was basically owned by the Japanese for decades. And you know, there were other automakers, Ford and others sell there too, but it was basically known as kind of Japan's backyard and where companies like Toyota sold tremendous numbers of vehicles. The Chinese have really started to eat their lunch. So that's happened and you know, you can see that a little bit in places like South Africa and Brazil as well. So yeah, the pie is still growing, but not that. Not enough for everybody to gorge equally. And it's really the Chinese that are pigging out, so to speak.

[B]

How's the quality of these Chinese cars? I remember when the Japanese cars came into the US in the 70s and 80s, the quality was just a lot better. That was one of the reasons they were able to get share. How about the Chinese quality?

[J]

That's an excellent point too because for years the Chinese have kind of labored under the impression that their cars are junk. And you know, that was true until fairly recently. However, in recent years the Chinese have caught up and in some cases even surpassed the technology that some of the Western or Japanese automakers have. There's a company called Xiaomi in in China that sold its first car last year and and now just bumped its capacity up to 350000 a year, which is like seven times as many as Rivian, a US startup makes. This company was making mobile phones a couple of years ago. That was its main claim to fame. And it's been able to move a lot of that connectivity and technology into the cock the vehicle. So you're finding that not only are Chinese cars cheaper, but oftentimes they have just as many creature comforts or sometimes more than the equivalent, say GM or Toyota or Volkswagen.

[D]

Our thanks to Chester Dawson, Bloomberg senior.

[A]

Editor this is the Bloomberg Intelligence Podcast available on Apple, Spotify and anywhere else you get. Your podcasts listen live each weekday 10am to noon Eastern on Bloomberg, the iHeartRadio app, TuneIn and the Bloomberg Business App. You can also watch us live Every weekday on YouTube and always on the Bloomberg Terminal. Running small and medium sized businesses is hard work. Business owners need to be sure that their ads are working just as hard as they do.

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