Bloomberg Surveillance TV: July 20th, 2026

Summary

Bloomberg Surveillance TV: July 20th, 2026 – Detailed Episode Summary

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Episode Overview

In this episode of Bloomberg Surveillance TV, hosts Jonathan Ferro, Lisa Abramowicz, and Annmarie Hordern deliver deep-dive discussions on the latest trends in finance, economics, and markets with a strong focus on technology sector capex cycles, global competitive risks, and geopolitical tensions—particularly the ongoing US-Iran conflict and related energy market responses. Key guests include Peter (Chair of Academy Writing), Henrietta from Adapt, and Ron Josie (Citi Analyst), each offering timely insights on market sentiment, investment risks, and policy impacts.

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Key Discussion Points & Insights

1. Market Overview and Tech Sector Risks

(01:51 – 10:29)

Downside Risks in Markets and "China Shock" 2.0

• Peter, Chair of Academy Writing: Expresses concern over increased downside risk in markets, particularly linked to corporate spending slowdowns and the threat of a new "China shock"—where an influx of cheap Chinese compute power could disrupt US markets, reminiscent of the manufacturing "China shock" of the early 2000s.
  • "Is China going to flood our markets like they did with trinkets back in the early 2000s?...They have the electricity grid, they have enough chips and they seem to flood their market." [02:09]
• Peter predicts increased competition and slower US compute build-out if this trend continues, emphasizing the difference in attitudes towards infrastructure building between China and the US.

Dynamics within Tech Leadership ("Mag 7" is Over?)

• Annmarie: Notes analysts are segmenting the top tech stocks ("Mag 7 is dead"); Peter considers this natural evolution as markets re-evaluate winners and losers, referencing Apple's AI strategy and Micron's recent earnings as case studies for shifting investor sentiment.
  • "I think people are now thinking about not this quarter's earnings, ... Where are we headed two or three years down the road and for the first time I think there's some question, will there be competition?" [04:34]

Capex Spending and Market Structure Risks

• Peter questions the sustainability and economic risk of pullbacks in capex among US tech firms: “If they get any slowing down on that, ... all those things I think would really hurt the economy.” [04:01]
• Secondary risks include the rise of leveraged ETFs, options risks, and high market correlations, heightening the risk of a sudden downturn—a "high correlation accident."
  • "All these things have become very correlated. ... So yeah, I think when this happens, it can happen really, really fast." [06:47]

Exposure to AI and Global Interconnectedness

• Hosts and guests discuss how all sectors—even those seemingly unrelated—are increasingly exposed to the AI spending cycle, both directly and through broader market wealth effects and capex flows. Airlines and emerging markets are used as surprising examples tied into the tech cycle.
  • "Everyone is exposed to AI, even if they don't think they are, because you're either exposed to the spending directly or the wealth channel.” [07:42]

Hedging Against Risks—Europe and Grid Infrastructure

• Peter suggests sector rotation and geographic diversification, highlighting opportunities in Europe and energy infrastructure in light of global realignment and self-reliance trends.
  • "I think Europe is finally starting to get the joke again...companies are...saying like yeah, we should do more of our own things, become vertically integrated. ...even in the US the grid needs to be built..." [10:29]

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2. Geopolitics: US-Iran Tensions and Policy Constraints

(12:12 – 17:15)

Military Escalation and Economic Fallout

• Henrietta (Adapt): Offers a sobering outlook on the US-Iran conflict, highlighting the IRGC’s strategic control over Straits of Hormuz as a persistent leverage point for Iran that's “worth more to Tehran than a warhead.” She warns that so long as Western finance and insurance cannot tolerate IRGC control, confrontation will likely persist.
  • "The reality remains that the port authority of the IRGC is just simply unacceptable to the western banking world... as long as that's unsustainable and incompatible with the western economy, we will be at war." [12:47]

Congressional Gridlock and Energy Prices

• Henrietta maps out the legislative calendar, noting that although military budgets are being discussed, Congress is about to go on recess, making immediate US fiscal response unlikely unless oil prices spike dramatically.
  • "It’s going to look like there’s progress on getting Pentagon funding out the door but readily then they’re going to leave for five weeks. ...My odds of passage are 30% at best. ... The single most effective way to get rates down was to stop the war." [13:40]

Tariff Authority and Policy Tools

• Discussion of President Trump’s tariff authority, set to be restored at week’s end. Henrietta highlights how losing and potentially regaining this authority affects the administration's diplomatic leverage regarding allies and energy security.
  • "The Supreme Court took away the President's tariff authority on February 20th and we started bombing on the 28th. That is just so noticeable throughout the entire duration of this military war. ...He will have that authority come Friday." [16:36]

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3. Tech Earnings, Capex, and Open Source Threats

(18:57 – 23:46)

Hyperscaler Capex, Market Expectations, and B2B Expansion

• Ron Josie (Citi): Evaluates the capex strategies of Alphabet (Google), Amazon, and emerging opportunities for leasing underused data center capacity (e.g., Matter to Anthropic), as insatiable demand for compute strains the market.

  • "We just raised our numbers because we think there is a strategic asset involved if you've got the compute, if you've got the intelligence and really the energy as well." [19:28]

• Discussion of how Google and others must demonstrate ROI on vast infrastructure spend, and what guidance the market is seeking:

  • "We're looking Google Cloud revenue growth... we're looking at their backlog or commitments ... and [Google] search can grow 17% this quarter because of their investments in Gemini..." [21:47]

Chinese Tech & Open Source Competition

• Ron Josie suggests open source models from China and elsewhere are rapidly catching up to the cutting-edge (“frontier”) models, creating significant timeline compression between innovation and commoditization.
  • "Open source models are now weeks or months away from the frontier models... the open source movement is absolutely catching up at a faster pace..." [23:05]

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Notable Quotes & Memorable Moments

• On the risk of a new "China shock":

  • "Is China going to flood our markets like they did with trinkets back in the early 2000s?...They have the electricity grid, they have enough chips and they seem to flood their market. I would not be using Chinese compute, but a lot of people might." — Peter, Chair of Academy Writing [02:09]

• On the risk of high correlation market "accident":

  • "All these things have become very correlated. ... It can happen really, really fast." — Peter, Chair of Academy Writing [06:47]

• On US-Iran tension:

  • "The reality remains that the port authority of the IRGC is just simply unacceptable to the western banking world... as long as that's unsustainable and incompatible with the western economy, we will be at war." — Henrietta [12:47]

• On open source AI models and big tech’s race:

  • "Open source models are now weeks or months away from the frontier models... the open source movement is absolutely catching up at a faster pace..." — Ron Josie, Citi [23:05]

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Important Timestamps

• 01:51: Market/tech outlook with Peter on US vs. China competition
• 02:57: "China shock": lessons from early 2000s manufacturing
• 04:34: Segmenting the "Mag 7" and the natural tech leadership rotation
• 06:47: High correlation accident risk and leveraged ETF proliferation
• 07:42: Systemic AI exposure across sectors
• 08:29: SK Hynix earnings now a US market risk event
• 10:29: Hedges: Opportunities in Europe and energy infrastructure
• 12:12: US-Iran conflict update; IRGC control of Hormuz as a long-term weapon
• 13:40: Congressional gridlock and its implications for defense funding and energy prices
• 16:36: Discussion of presidential tariff authority and geopolitical leverage
• 18:57: Tech earnings preview, capex concerns with Ron Josie (Citi)
• 23:05: Open source AI’s advance and competition risks

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Summary Flow & Takeaways

This episode offers a nuanced look at the tangled web of tech, markets, and geopolitics—highlighting both the interconnectedness and fragility of current cycles. Panelists stress the underappreciated possibility of another "China shock," the complexity of assessing AI's systemic impact, and the dangers of high-correlation in a market saturated with leveraged vehicles. On the geopolitical side, guests emphasize the persistent economic and political risks from Middle East conflict, compounded by legislative lethargy in Washington. Finally, despite aggressive capex and innovation in tech, the inexorable rise of open source models levels the playing field at a breakneck pace, demanding constant strategic reassessment by investors and policymakers alike.

Transcript

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[Jonathan Ferro]

This is the Bloomberg Surveillance Podcast. Jonathan I'm Jonathan Ferro along with Lisa Abramowicz and Annmarie Horton. Join us each day for insight from the best in markets, economics and geopolitics. From our global headquarters in New York City, we are live on Bloomberg Television weekday mornings from 6 to 9am Eastern. Subscribe to the podcast on Apple, Spotify or anywhere else you listen. And as always on the Bloomberg Terminal and the Bloomberg Business app.

[Lisa Abramowicz]

We begin this out with stocks and crude rising as Wall street searches for stability. Peter, Chair of Academy Writing Many of the inflection points have demonstrated a clear direction to which way they are head, but with everything going on, expect more downside for markets. Pete joins us now for more. Good morning.

[Peter (Chair of Academy Writing)]

Morning.

[Lisa Abramowicz]

What's the source of that downside risk for you this morning?

[Peter (Chair of Academy Writing)]

You know, I think it's rethinking of what's going on with the spend. That's a big part of it, right? Our company is going to continue to spend. Will we see any signs of slowdown? And at the same time, you know, we kind of talk about these moments out of China. I'm wondering if what we're starting to see is just a flood of cheap compute, right? Is China going to flood our markets like they did with trinkets back in the early 2000s? Have they built up enough computer? It's not as good as ours. I don't think and you know, they distill it from our models probably which helps on their costs. But the reality is they have the electricity grid, they have enough chips and they seem to flood their market. I would not be using Chinese compute, but a lot of people might. So that to me, I hadn't really thought about that until in the last couple of weeks and it's coming more and more in conversations. That's my concern is real cheap competition from China Circle what we saw back in the 2000 where they just flood our market and it slows down our build.

[Lisa Abramowicz]

There's a whole body of literature on the so called China shock from that time. China, if we have another China shock, what would it mean for the backdrop for the economy and for markets?

[Peter (Chair of Academy Writing)]

I think it would be awful. Just my best comparison right now is probably look at BYD automobile in Europe. I was in Europe last week, I had to go check out one of the showrooms. They're interesting cars. They are now dominating sales in Germany. Right. So they are eating away at stuff. Does that come to us? I don't think it should. And the other problem didn't really mention is, you know, I think the concept of not in my backyard does not exist in China. I don't think anyone would say oh you can't build that here like with any expectation that wouldn't happen. And you're seeing that really grow in the US I thought it might be a 2028 issue. It's coming quickly.

[Annmarie Horton]

You said that the risk is that it would slow the build of COMPUTE in the US which is kind of exactly opposite of what some people are expecting from earnings. They're expecting the market to potentially reward companies for reducing their capex spend on building out compute. Do you see it differently?

[Peter (Chair of Academy Writing)]

I think the companies that may reduce their spend and get rewarded, you know, the debt diet sort of companies, they might do well. But what, what's that going to do for the picks and shovels?

[Henrietta]

Right.

[Peter (Chair of Academy Writing)]

All the companies that were applying into this and again I think it's very dangerous for the economy as a whole. For the last year or so we've been looking at this kind of as a two party economy, the non part and the spend part. So if they get any slowing down on that, the construction that goes with that, all those things I think would really hurt the economy.

[Annmarie Horton]

Right now a lot of different analysts are trying to Split up the Mag 7. They're saying the Mag 7 is dead. There isn't such a thing anymore that tech is being segmented into different segments and you're seeing rotations through them. Is that a positive, is that a negative? Is that a bear sign? Is that just a natural evolution where everything is.

[Peter (Chair of Academy Writing)]

I, I think it's a natural evolution. Look at Apple for example, right? Apple did not invest a ton in AI, right. They kind of let the market develop, their stocks do. And I believe they're just off all time highs. So the market's trying to figure out who's winning, who's losing, what's priced in. And I was really excited about earnings about two weeks ago until what we've seen. And I go back to Micron, awesome earnings, right? Great guidance to three years of, you know, chips sales. All those things were right. Stock went up and it's given it all back and then some. So I think people are now thinking about not this quarter's earnings, not even like next year's. Where are we headed two or three years down the road and for the first time I think there's some question, will there be competition? Are people even in the US trying to create alternatives? And you know what we've seen in these sorts of cycles, you get these parabolic moves up and it was bearish, kind of has to be quiet, duck their head and all of a sudden people can feel a bit more comfortable. And I'm still waiting for more and more CEOs to say we love AI. It's really helped our company. My sense is people are starting to feel some pressure on the token utilization. Everyone used to have these leaderboards and the more you spend on tokens, hey, you're the best person here now, people. So what exactly do you get that? So I think we are due for a bit of a pullback and some of it will come with allowing the more negative or concerned narrative to play through as well.

[Political Analyst]

Well, we saw some of that concern when it comes to at least policy in the gubernatorial races for New Jersey and Virginia, it was all about electricity prices. This year, especially at the moratorium in New York, it's about data centers, not my backyard. How much of a political risk is there to this trade?

[Peter (Chair of Academy Writing)]

I think there's a decent amount. I think you're seeing kind of this not building in my backyard is kind of step one. Again, there are lots of states that want this business. They do want it. But my bigger concern, this probably more down the road is you could start seeing some sort of windfall tax, some sort of tax, you know, people. Again, I hate the concept of universal basic income, but you're seeing this play chatter about this in South Korea. And I could see some group of politicians saying, you know what, you guys make too much money, we're going to tax you, we're going to do something. And that would really be bad for stocks. And again, I think we need our data centers. We need this for national security. We should be growing it. I think the industry has to do a better job communicating the need and that they're good for us and they have not done a good job. So I'd like to see this, but I think the risks are there and real.

[Lisa Abramowicz]

I'm going to ask you a question based on the title of some research from Jonathan Krinskiy of bcg. Do you think a high correlation accident is brewing here?

[Peter (Chair of Academy Writing)]

I could see that. So one of my concerns is we've been talking to some people and if you think about various factors, right, you have momentum, you have all these factors. And you know, a lot of the really best hedge funds kind of run their positions based on these factors and they're trying to organize it. And one of the sense get is AI is starting to creep into a lot of these factors. So you think you don't have any exposure, but you do. And so all these things have become very correlated. And I would add that market structure to me is just off. I hate all these triple leveraged ETFs. I think, you know, there's like eight or nine leveraged ETFs on Space X alone. It's only out two weeks. Like why do we bother with single stock leverage stocks? L so XL is a $20 billion triple leveraged ETF. You have zero day expiration options, weekly options. So yeah, I think when this happens, it can happen really, really fast. We saw a bit of it last week. I think maybe we had a bounce. People are looking for their earnings, but the next wave I think could be fairly ugly. So I like that phrase, the high correlation train wreck or whatever accident.

[Lisa Abramowicz]

Potentially, Potentially. Potentially. Question. Potentially, we've got to ask. Yeah, that's another way of looking at it too. Look, everyone is exposed to AI, even if they don't think they are, because you're either exposed to the spending directly or the wealth channel. Elisa was half joking, but she was right last week when you were asking the airlines whether they're an AI trade as well because of the amount of spending coming from very particular places that are built off the wealth being created by all this spending.

[Annmarie Horton]

Where's the business spend coming from? It's coming from defense. A lot of it is tied to AI as well as the financial sector because everyone's flying around trying to get the business at a certain point, even if it's not necessarily directly tied to it. Everyone feels a lot better because stocks are going up. You also start to wonder how interconnected emerging markets are, say to the United States in ways that they just haven't before. And how much volatility can be introduced given the lack of understanding of where we're going in the next.

[Lisa Abramowicz]

So we get earnings, I think from SK Hynix in the next week. And I was looking at the calendar, I was thinking, okay, that's a risk event for US Markets, isn't it? Earnings from a South Korean company. Now, a few years ago that was absolutely unthinkable, but that's where we are again.

[Peter (Chair of Academy Writing)]

I think a lot of things have been tied in again. I don't. We were always going to pay some attention to South Korea, but we get a little bit more looped into this. And again, you know, we have all these leveraged ETFs. The Koreans have all sorts of these leveraged products. Right. And my one thing I'm starting to pay a little bit attention if you kind of watch, you had, I would say the really gambling sort of crowd love crypto. They were in that sort of space and it looks like they shifted their attention much more to the tech. And I build out quantum and if that set of money pulls out at the margin, that's a reasonable chunk of money. And you're starting to see some inflows into crypto again. So maybe people are going to reposition where they get their most bang for the buck.

[Lisa Abramowicz]

So this all sounds super bearish. So help me find that hedge to that high correlation accident. If it materializes, where do I go?

[Peter (Chair of Academy Writing)]

You know, right now I think you want to be a bit in Europe. I think you want to be in the companies that. Well, I know it's kind of scary

[Annmarie Horton]

to say it's the anti trade. It's hysterical. Carry on.

[Peter (Chair of Academy Writing)]

Well, actually. And it's also their design to build out their own things. I think. Just today I was coming in, Bloomberg radio was talking about Bezos making an investment in a European AI company. So I think Europe is finally starting to get the joke again. They'll probably screw it up a couple more times, but they have to make their own things, they have to get their own electricity. It'll be really, really curious to see what the new Prime Minister does in England. Like, I think they should be releasing bp. They should be doing these things with the North Sea. They should be really expanding their energy base. And I think Trump came kicked the hornet's nest and said everyone's got to do more of their own thing. And by us I think companies are countries are saying like yeah, we should do more of our own things, become vertically integrated. We're not going to buy as much US So I think that creates opportunities, particularly in Europe. I actually think Canada is probably decent on that front. Carney's I think been playing tough has been rewarded for that. So I would say and even in the US the grid needs to be built out even if we slow down data. I think anything that you know we've sold off a little bit in the electricity in the grill bill, I think that has to be done regardless of how the spend goes. So I like that sector as well here.

[Jonathan Ferro]

Stay with us.

[Lisa Abramowicz]

More Bloomberg surveillance coming up after this.

[Peter (Chair of Academy Writing)]

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[Lisa Abramowicz]

So here's the latest this morning. The US Conducting a ninth straight dev strikes on on Iran following the deaths of three service members over the weekend. The Iranian Foreign Ministry confirming the receipt of mediator proposals early this morning. What does the off ramp look like? Henry Trace of Adapt is writing this. IRGC control of Hormuz is worth more to Tehran than a warhead. It is a weapon they can deploy at will and then deploy again. Expect escalation rather than resolution in the days and weeks ahead. Henrietta joins us now for more. Henrietta, good good morning and good to see you here in New York. Great to be with you what does the solution look like? Given the quote I've just read from

[Henrietta]

you, I think that we are on day nine of what will be a pretty expansive protracted engagement on the military front. I am discomforted I guess is the word to use by the frequency with which I hear administration officials and those in the sort of tertiary military space talk about boots on the ground. Kharg island escalating militarily. The reality remains that the port authority of the IRGC is just simply unacceptable to the western banking world. Whether you're an insurer or a tanker getting through or JP Morgan trying to do business with any industry that wants insurance or wants to deal in getting flow through the straits. So as long as that's unsustainable and incompatible with the western economy, we will be at war.

[Political Analyst]

They're moving some more warplanes to the Middle East. We also have Secretary Hegseth and Joint Chiefs of Staff, General Kane Staff speaking to the Appropriations Committee tomorrow in Congress. We're going to get more funding for this war.

[Henrietta]

Not anytime soon. And I think the timing is really important to watch, especially when you think about what the US consumer or any consumer is going to be dealing with in gas prices. So the sequence of events is helpful to follow here. The House members are going to be in session for the rest of the week. It's going to look like there's progress on getting Pentagon funding out the door but readily then they're going to leave for five weeks. The Senate is nowhere on the reconciliation bill. My odds of passage are 30% at best. The only reason I'm that optimistic though is because think about how much longer this war is going to escalate. To John's point and sort of the military component that you're talking about is we're going to be in this until the end of August. J.D. vance's you know, 60 day window is what August 20th I want to say. So we'll definitely bump up against that. We'll have no stimulus from the Congress side and then they'll come back in September and if the war is still raging gas will be 456 again which is where we saw the President call off the war last time. And the single most effective way to get rates down was to stop the war. So as we're way out into September and even October and heading into the election there's going to be optionality for a stimulus bill for some funding for the Pentagon, maybe a gas tax holiday. Those are options that exist, but not for months.

[Political Analyst]

But the House and The Senate are in session this week and they won't together be back concession to your point till the middle of September, right? Well, they need to do something before September. If we're dealing with above $4 a gallon gasoline, that's a possibility.

[Henrietta]

But I think you'd have to get up to 450 like this week in order to have them move in order to cancel the August recess. They just don't do that. You guys know that as well as I do. They don't cancel the August resets. It's inviolable. So as long as they want to get out of town, they won't be doing anything.

[Annmarie Horton]

So none of the War Powers act or any of the potential or legislative constraints on what President Trump can do in Iran really comes into play when they're on vacation. Is that the issue that essentially that's not even up for debate and potentially isn't even a constraint later on?

[Henrietta]

That's definitely the case right now. I mean there's a couple events that are happening at the end of this week. The President needs to decide what to do on tariffs. So I find that that is important to be mindful of. I know the street is exhaustive tariffs. I'm sorry, I'm not The, the tariff authority is going to be available to the President at the end of this week if Jameson Greer has done his job correctly because the Section 122 tariffs expire. So if you're mad at Spain, if you're mad at France for not sending enough anti mine capabilities to the UK or anybody, this is your opportunity to make a choice. Do you want to keep penalizing everybody the way that you're doing with Iran and go to effectively a tariff war with those nations and ask them to get involved in the Strait and whether it's peacekeeping missions or military missions, this is your opportunity and he has that chance this Friday.

[Annmarie Horton]

Is there a sense that President Trump will go hard on some of these tariffs at a time when the Iran war is escalating and he's looking for greater alliance cooperation to potentially fight back some of the IRGC actions in the Strait of Hormuz?

[Henrietta]

I think it's a glaring absence and has been since the war was announced. And the sequence of events is really fascinating to think through. I mean the, the Supreme Court took away the President's tariff authority on February 20th and we started bombing on the 28th. That is just so noticeable throughout the entire duration of this military war. The fact that the President hasn't been able to say you will Come with me to the Strait. You will help me in the Strait unless or else I'm going to tariff you. You know we saw that through all of 2025. I don't like your digital services tax boom. You get 100% tariff here. We have the same kind of thing and he just doesn't have the authority. He will have that authority come Friday.

[Jonathan Ferro]

Stay with us.

[Lisa Abramowicz]

More Bloomberg surveillance coming up after this.

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[Lisa Abramowicz]

Alphabet Kicking off those earnings later to this week for the hyperscalers. Investors of course looking for that justification for spending. Ron Josie of Citi expecting capex projections for next year to reach over 800 billion USD writing we believe this is by far the top focus into 2Q earnings given continued demand and rising component pricing. Ron joins us now for more. Ron, let's get into those numbers. Are you seeing any market based pushback that would lead to a rethink of capex intentions from some of the big

[Ron Josie (Citi Analyst)]

players at this point? Not really. I mean that's the biggest question going into earnings as we just talked about. You would think if there was more pushback, I think the equities would actually come back a little bit more than they are. Frankly right now we are waiting when Google announces on Wednesday, we're waiting for them to really reassert their strategy and where they want to go. Meaning that we have delays on Gemini on some of their models like Gemini 3.5 Pro. We've seen some issues where they're sort of falling behind and other things and so we really want to see is what are they going to do with all these cap all this Capex is being spent as you said we Just raised our numbers because we think there is a strategic asset involved if you've got the compute, if you've got the intelligence and really the energy as well. And that's something that Google is really racing to have. So you have those three.

[Lisa Abramowicz]

Yeah, I just want to jump in because different companies are doing different things with that compute capacity and matters. An interesting example of that just on Friday into the weekend we had the New York Times leader reporting that they're looking potentially to lease computing power from its data centers to the likes of Anthropic. Do you expect to see more of that kind of opportunistic move from the likes of Matter maybe others too?

[Ron Josie (Citi Analyst)]

Well, I think if you have, and I don't want to use the word excess capacity, I'm not too sure there's excess capacity out there everywhere. We, everyone, we talk to everyone, we, we sort of have conversations with, talk about the term insatiable demand and the demands there and it's out tripping the supply. With that said, if you're Matter, we've been a little bit delayed in terms of their personal superintelligence or medicine intelligence strategy. And so if in fact they do have these 8 gigawatts of power, maybe going to 14 over the next year or so and they have extra power available, I think they're looking around and seeing, well maybe we can actually get some dollars back or subsidize some of the costs that we're doing with our capacity and compute that we've built out. So I think we do see more of this assuming there's capacity available and maybe that is the best one to do that simply because we're waiting for these new products to come out. And you know, when these products come out, rarely is it a big bang where you launch and then you have demand that exceeds capacity. It probably takes a little bit of time to, to adopt it.

[Annmarie Horton]

Is there any way that these hyperscalers in particular can show return on investment that would make an increase in capex beyond expectations worthwhile for the market?

[Ron Josie (Citi Analyst)]

Well, we're looking at two things really. Really, if you're talking about Google here the next week or next couple of days, I think there's like three things that we're looking for. Of course we're looking Google Cloud revenue growth. We're looking as part of that, their backlog or commitments in terms of pretty much guaranteed spend over the next couple of years. And that's a number that's been growing incredibly strong over the past couple years frankly. To help highlight what is the demand for Google Cloud and really the demand for AI. But then we have on the Google other side, which is there, which is Google Search and we think Google search can grow 17% this quarter. It's growing because of these investments, because of their investments in Gemini and frankly people are searching more. So if you're Google and even matter, for that matter, you're building on both the, and Amazon, you're building the consumer side, but then also have this massive opportunity on the, on the B2B side. And that's something we're looking at as well. Right. So that's the commitments, that's the revenue for Google Cloud and that's of course the core Google properties business.

[Annmarie Horton]

Do you suspect, Ron, that we're going to see or that we already have seen signs that truly Chinese tech companies have started to cannibalize from US tech companies, whether it's in models, whether it's in compute, whether it's in international clients. I mean, are you getting any sense that that actually is coming to fruition?

[Ron Josie (Citi Analyst)]

Well, I think one thing that's absolutely coming to fruition is the fact that these open source models are now weeks or months away from the frontier models and we are absolutely seeing a compression of timeline of new models being launched. And these models, you state of the art frontier models are to none. And so what we're seeing for sure is the open source movement is absolutely catching up at a faster pace which is certainly causing us and everyone on the street to say okay, we're investing all these dollars in intelligence and compute and energy yet for only to be copied down the road or not copied, but frankly followed. And so that's going to be a key theme and topic I think on Wednesday and also into next week with that Amazon numbers.

[Jonathan Ferro]

This is the Bloomberg Survey, its podcast bringing you the best in markets, economics and geopolitics. You can watch the show live on Bloomberg TV weekday mornings from 6am to 9am Eastern. Subscribe to the podcast on Apple, Spotify or anywhere else you listen. And as always, on the Bloomberg Terminal and the Bloomberg Business app.

[Francine Lacqua]

This week on Leaders with me Francine Lacqua, I speak to tennis legend Rafa Nadal about how he stayed competitive despite injury.

[Rafa Nadal]

I was able to enjoy the victories probably more than if I will not have this issue.

[Francine Lacqua]

One iconic match in my mind was

[Rafa Nadal]

I am almost dead and whether he misses playing, I don't miss tennis because there was nothing else to offer.

[Francine Lacqua]

Listen and watch Leaders with me Francine Lacqua on Bloomberg Television or wherever you get your podcasts.