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Hill: All right. Welcome back to Energy Cents, an IHS Market podcast focused on topics that lie on the intersection of energy and in finance. This is Hill Vaden, and I am here today with Peter Gardett, who returns after joining us... what, maybe a month ago? To discuss energy finance arrangements. Peter, welcome back.
Peter: Thanks Hill, good to see you
Hill: Yeah. So we're going to talk about Joe Biden and energy policy. Actually, I requested that I had somebody saying that they wanted to hear a little bit more from IHS and what we were looking at in terms of the Biden Energy Policy. And what that means for investment and what it means for energy and other things. Before we get into that though, when we were just talking briefly beforehand, Malcolm Gladwell has you know, mentioned to you as releasing, I think it just went out a new book? And you say you've never read any of Malcolm Gladwell's books previously?
Peter: No. I mean I used to get the New Yorker, and so I would occasionally read one of those very long articles. And I'm familiar with the 10,000-hours, I think like everyone is. But never read any of those books incredibly.
Hill: I've read all of it. Though less of the New Yorker though I guess. What would the David and Goliath book was just a collection of his New Yorker columns. But why I mentioned it, his new book is not a book at all, it is a fully audio quote-unquote book where he has taken his podcast revisionist history, and he almost made it into a movie that one would listen to and not watch. Which is this one is on what I think it's called the Bomber Mafia, and so on Curtis LeMay. And the idea, I think it's World War II of bombing to oblivion to shorten the war. But I, you know doing these podcasts, and I'm by no means comparing this podcast to anything Malcolm Gladwell would ever be associated with, but it's an interesting just embrace of this new media.
And I know you have been working on this specific topic, on this Biden topic through multimedia I think. Just within the past month or so you published a report to clients participating in the webinar to clients, now we're doing a podcast and God knows how many calls on the back. So do you have a preference in any of these forms as a content producer?
Peter: As a content producer I think you need all of them in a way. I find that at least personally I think in different ways when I'm writing as opposed to conversing with someone, as opposed to preparing for like a speech or a webinar in that sense. But I think they all have value and they all kind of work well together which is one of the things that I like. I also, I'm a huge listener, a huge consumer of, particularly podcasts. And I find them very efficient if you would like to know about you know, earlier this year like most people I went through a period of trying to understand what the hell a SPAC transaction was. And there were a number of really good podcasts out there that I think got me up to speed, almost like taking a self-designed college course. It was great very easy.
Hill: Efficient because you can multitask, or because you just listen well?
Peter: I think maybe you listen, I don't know, people listen faster than they read maybe? Or the conversational aspect of it sticks with me better? Or just because I listen to them on the treadmill so it's like two things at once.
Hill: Yeah. I'm the same way, and I think a lot of it is I'm multitasking at least for me where I'm either running or driving. I haven't yet been able to listen to a podcast on one subject, listen to a book on one subject, and read about another subject they just get to conflated and can't put either one of them together.
Peter: I can see that.
Hill: So it hasn't allowed me to double up on information. Well, so again we're going to talk about the Biden energy is shaping up to be one of the hallmarks of the new, guess we can still call it new, Biden administration. And you and I were talking earlier, just you know, how important or relatively important energy policy is. Two different presidents. And we were talking specifically about Jimmy Carter and some 40- 45 years ago is when he gave his famous speech in a cardigan, talking about an energy policy. And whatwere a couple of his comments.And what one of them was that we must face the fact that the energy shortage is permanent and there's no easy way to solve it quickly or something like that. And his big goal or some of his big goals very early in that conversation were on conservation. What we're on different coal technologies. But almost, listening to today, almost defensive from an energy policy standpoint.
Which compare that to Joe Biden from, what was it? Two or three weeks ago with the Leaders Climate Summit or [indiscernible][00:06:07] Very offensive. Not in a negative way but a very proactive, I guess maybe a better word. And he's in a sharp suit, and everything else. But the whole attitude to change it. And I don't know, I haven't read every word or seeing every article, but I'm not sure how much conservation was in the dialogue? It was a lot on innovation and a lot on stimulating increased energy as opposed to this energy shortage. And then lastly and I'll shut up, but the idea that this next decade, these next 10 years, are going to be a transformative decade.And we have to act quickly as opposed to, we got to huddle up and kind of get through this. So when you're looking at it, how are you interpreting, kind of, Biden's policy relative to say what we were just talking about with Jimmy Carter?
Peter: Yeah. So there are definitely differences and similarities. I think one of the biggest differences is that absolutely no one in the administration has referred to this as an energy policy or an energy plan. This is a climate policy, and it's a jobs policy. It's not the American energy plan. It's the American jobs plan. And that linkage between a climate policy that can help incentivized technological development, financial changes in the financial system, changes in the way people do business and live, and that those changes themselves than create jobs is an interesting and somewhat different take.
That I think started with, and I think you know it's a less controversial way of thinking about the Green New Deal, which did have the kind of exclusionary aspects where you want to get rid of coal, you want to get rid of fracking, all of these things. You want to label some things as bad, and some things as good in the Green New Deal. But it had at its heart this concept that public investment in new systems, whether it be energy infrastructure, sustainable plastics, all these different sort of materials. LED technology, innovations as supported by public policy can be economic drivers and can create lots of new jobs both in the public and private sector. And I think that's really the key here that there was this concept.
I've heard it described by the national economic adviser Brian Deese, as moving from a soccer game to a foot race. So in previous eras, you had fossil fuels versus renewables, you know, and it was like a game to see which one would win the future. This is more like everybody is an employee or an economic actor all lined up at a starting gate, and they're going to fire off the starting gun, and everyone is going to run as fast as they can in the direction of the future. And the direction of the future, in this case, has to do with cleantech and climate-aligned industry, and climate-aligned finance. But in a way climate-changing, our approach to emissions that contribute to climate change is almost like a beneficiary side effect of economic policy that supports new technology and job creation.
Hill: Does that make it at all more difficult? The idea that policy is much better I would argue, at protecting jobs that exist, than creating jobs that don't exist.
Peter: I think there's a very, this is an interesting large-scale real-time economic experiment we're about to run on this. Because there are two schools of thought here. One is very informed by the economic policy of what we might think of as everything from the Roosevelt era through the Space Race. Which they are constantly comparing, democrats are constantly bringing up that the Roosevelt example, or the space race example in which large-scale public spending in infrastructure and cutting edge technology created the industries of the future. Everyone talks about how the internet is an outgrowth of a defense, a Pentagon project. Then there's the other side that, we have a substantial amount of evidence that governments frankly don't allocate money very efficiently or very well. And so, are you in fact, creating a system that is by its nature not as innovative because it pushes out private market actors by pumping a lot of public money into efforts that wouldn't necessarily play out?
Earlier we were talking about the Law of Unintended Consequences, and the Biden administration, like most administrations, and this is one area in which it's it's quite similar, is trying to use the tax code to change business policy. And it's a very American way of going about things. It's like, for some reason the only laws we can never change are tax laws. And so they're attempting to use, to expand, quite significantly the use of investment and production tax credits for renewables, but also for new technologies that frankly have no commercial application yet.
And this builds on a really long tradition for decades. There was a clause in the tax code called Section 45 that was originated by Jimmy Carter's IRS, and it was intended to promote the creation of a synthetic fuel industry based on the US coal industry. The idea was that at the time the US was short on oil, fracking hadn't been developed yet, it's very dependent on Saudi Arabia and the OPEC countries, so we should use all the coal we have in the ground now create fuels that are advanced and we're going to do it through the tax code. We're going to give a per tonne tax credit to coal companies that are creating advanced fuels.
One thing led to another, led to another, and after a few years what you had was coal companies running run-of-the-mine coal underneath a spraying device that just put diesel and rubber on it raise the BTU factor. Created all this tax equity that then led to other investments, including of all things Disney World. So I'm sure that when Carter went out to change the energy system he didn't say, "I'm going to put something in the tax code that will lead to the building of Disney World." But God knows what will happen when we pump however many hundreds of billions of dollars into as yet unproven technologies, it will be interesting to see.
Hill: I think one of those, another unintended consequence, I think and I guess I should be careful saying this on a podcast, but I think that Reynolds Wrap, or aluminum foil, is an outcome of the Space Race. That there was something that was needed to handle whatever is going along with the rocket in space, and now we can wrap our buns in aluminum foil thanks to our moon ambitions.
Peter: Yeah. So it's an ongoing kind of bigger theme. The role of let's call it the state in funding and kind of identifying future economic pathways, and encouraging new companies to develop to serve them. And then openness to market solutions, and trying to find that balance after everything that's happened since you know 2008 and the great financial crisis? Yeah. We're living in interesting times, let's put it that way.
Hill: Well, and then there was some efforts by Obama with fractions of the money that we're talking about now. Which in some ways that, at least you know my age, it's kind of awesome regardless of one's politics to look at these kinds of big numbers and compared to some of these FDR, LBJ, kind of big government efforts. Because I haven't seen it before.
And whether it's good or bad I'll leave up to the talking heads on tv. But it's a different discussion, and compared to say 2008, which was you know at its worst a kind of a bailout for a broken system, and at its best a way to kind of rebuild what was a fractured system. But it did include some energy or climate-directed monies. The famous example and the main people remember a solution, but there are plenty I would guess. And I'm sorry that I don't have the numbers to quote or anything, I would guess it for the Solyndra there's still a lot of unintended or very well-intended, very intentionally intended positives that came from that... what was it $80 billion thereabouts? $90 billion?
Peter: Yeah, it's a pretty substantial amount of money at the time, although everything seems small by comparison. That billion dollars used to mean something. But, yeah. Tesla is the is the counter to that. There was a stimulus ACCA money that went into Solyndra for sure, and then there was ACCA money that went into Tesla. And what was the... if the goal was to bring down the price of solar panels, then even though it was not accomplished by funding Solyndra, that is what happened in the end. So, yeah. I think it's clear that the Biden administration is taking what the Obama administration did and supersizing it in many ways. And in many ways, it's the same team. I mean we talked about the big foreign policy summit from a couple weeks ago, and the names, the figures in that room, are all pretty familiar. I mean John Kerry was Secretary of State, not under the current president, and there he is again essentially playing that role alongside Secretary Blinken in promoting the US as being kind of back on the stage.
Hill: When I think the White House press release from that April 22nd or 23rd, the very end of the first paragraph says something like, "America is back," or something. It was very Hollywood-esque as the game is back on. So I think there's a lot of I guess excitement, whether enthusiasm's the right word, there's certainly a lot of excitement what with the changing conversation. Talking about the public-private partnership, yes, I think there's always concern or risk of public money pushing out or crowding out private investment. But there seems to be a, I'll say intentionality into looking at public and private together, and creating you know,that this isn't a government exercise on its own.
Peter: No, for sure is not. I think over and over and over you've heard from the administration, and I think that was particularly true in the kind of foreign policy focused climate leaders summit, that no matter how much money or effort any individual government or state undertakes it's a global problem, and it's a problem of such scale that it will require substantial meaningful private sector solutions here. And that those private sector solutions can be a huge opportunity both for the countries and the economies that they're part of.
Hill: When we look at some of, the kind of the big stated goals, and I think some of the big ones were that the power sector was supposed to be 100% carbon-free by 2035? And we're supposed to reduce emissions relative to 2005 levels by 50 to 52% by 2030, right? And those are those ambitions are inclusive of hydro and nuclear, I think in both cases. When you're looking at it, where the potential sectors who we really expected to be called the winners, or the ones who really just got a shot in the arm? No pun intended for the other Biden initiative.
Peter: Yeah. So there's a couple of devil's in the detail here. When it comes to renewable energy, particularly, particularly wind and solar and to a lesser degree hydrogen. And we'll call it carbon capture and storage as part of that, even though it's not a renewable energy it kind of fits within the same clean tech thesis. I would argue that the way that the funding as proposed works? Really, really favors projects that are already in the pipeline. So the direct pay element of the tax credit proposals means that a lot of renewable energy and these other projects will almost immediately be in the money. They'll have this incredible financial cushion straight away. It's grant-making by another name. And so in that case I think those if you want to talk about a shot in the arm, that is like steroids for that particular sector.
Another sector that I think is clearly going to benefit here is the electric vehicle sector. Electric vehicles have a lot of innate advantages, and those are getting more and more apparent as battery prices fall and companies, manufacturers become more comfortable manufacturing and selling EVs, and customers themselves become more comfortable driving them. But this will, I think the whole way the plan is structured, will accelerate that timeline; the timeline of the uptake of EVs and the retirement of internal combustion engines. Whether it will happen quite on this scale that Biden administration is looking at, are on the timeline. I'm of the opinion that will take a little bit longer, just because it's difficult to retire out the current fleet, much less the coming fleet. And then the final piece of it that I think is super interesting is around carbon pricing and offset trading. So there is a significant part of the economy that isn't covered by current technology deployment. So when you're talking about the power sector, it is plausible to retire all fossil fuel power generation and replace it with renewables in the next decade-plus. That is technically feasible even if it's hard to imagine. It is technically feasible that we will switch out the car fleet and replace it with EVs.
At the moment It is not technically feasible that we will replace steel, concrete, chemicals, plastics. There's a number of sectors that are hard to abate as they call it. Are really, fundamentally at this point, almost impossible to abate. And so those will need to be covered by some kind of allowance system whereby you over-compensate in your emissions pathway, you take the power system down faster in terms of emissions than you would otherwise in order to compensate for the fact that you're overproducing on that pathway from chemicals and some manufacturing processes. And the difference between those two is going to be covered by offsets. And the question has always been how big is that offset market going to be? Because the larger it is, it will help dictate price, it will help to dictate kind of who participates, is a big open question here of what that will look like.
And the announcement of the nationally determined contribution, which was that 50% number that you were talking about, makes a big... a big step in that direction. It gives us a lot more shape around what the policy approach to a policy space for a carbon market will be. Essentially says that 50% of the economy is going to be covered by some form of offset. And so that's a pretty big market, and that's a lot of opportunity for trading firms, financial firms, anyone who handles sort of commodity, or price, or operational risk, to come in and say, "Okay now I understand how much of the economy is going to be covered by essentially a trading system, as opposed to a direct dictate, that you must replace a coal plant with the solar facility," if that makes sense.
Hill: Yeah. And then I guess a lot of that is stopping at kind of, call it a business level, where you know the owner of the power plant or the owner of the cement plant has to make a decision. And to, I suppose, buy that offset. I think the one thing that kind of hangs out as different is electric vehicles. And I'm talking to you, with I own two cars, both of which are powered by gasoline. I bought one of them with intentions of giving it to my son when he turned 16. He's 10, so I don't plan on buying a new car for a very long time.How does the consumer kind of fit into this? Is the consumer indifferent, except when it comes to electric vehicles as long as that cost isn't passed through to him or her in a way that he or she notices?
Peter: I mean, I think there will be some kind of lingering market for internal combustion engine vehicles well into the future. I don't anticipate that the gasoline-powered car is going to disappear from our roads in the next 10 years. Having said that the electric vehicle is cheaper and simpler to produce if done in scale, if appropriately tied in with a charging network, is cheaper to operate and own. And if battery prices continue to fall, and that's kind of to me the more the wild card there, it's going to be cheaper to buy upfront.
And so if you end up with a system whereby either producers, the manufacturers of what's... let's call them legacy auto technology, the gas-powered engine, are required to buy offsets or to somehow least lifecycle emissions of the vehicle they're going to pass those costs on to consumers. Whereas if an electric vehicle is allowed to kind of take all of its displaced emissions upfront, it doesn't need to pass those costs on to consumers. And so the price differential will just continue to grow over time, and eventually, for everyone except maybe a hobbyist or an enthusiast of like classic cars, you're going to see people make the economic choice. Which will be electric vehicles.
Hill: When buying a new car?
Peter: When buying a new car.
Hill: Or a new to you car, right?
Hill: I guess it was Cash for Clunkers, what was that Obama, or was that...?
Peter: I believe. Yeah, it was partially. I haven't owned it, I mean we talked about this on the last podcast, a car in a long time. But yeah. I think those are, those programs can be part of it. And I think 10 years from now if all else has gone well, it could be part of the policy solution. But for now, as you said, the main thing that the administration is trying to do is to promote new technology, new ways of doing business, new manufacturing, and really use that to drive investment and job creation. And Cash for Clunkers really doesn't do that.
Hill: So another thing you and I were talking again, I guess before we started, but you describe this as really being policy following the market. And a lot of this stuff is in motion where we're coming off of 2020 when some of the hottest investments... we'll push this back to the side for a little while, but some of the hottest investments were solar, or Tesla were some of these clean energy ideas. Can you talk a little bit about how that's different from policy meeting the market and why that matters?
Peter: Yeah, sure. I mean there are ways in which policy or policy actions can lead the market. And we talked earlier about all of the products that came out of DARPA, or like the defense agencies, or these other research agencies within the government. And there are markets over time that have been created essentially by regulations.
So ethanol is a good one. Would ethanol have existed as a market without government regulation? Hard to argue that it would have. In this case, however, although electric vehicles are a small portion of car sales today, they are growing super rapidly off of zero to where they are today. The economic and kind of co-benefits of an EV beyond the emissions profile is so self-evident, that when you add the emissions premium to it, any kind of carbon avoidance premium, or gas avoidance premium to that; it just it's such a compelling economic argument.
There's something I go kind of over and over to with our clients, is that, yes, we should absolutely as an investor you should care about the planet, and you should care about climate policy for lots of different reasons. Your investment remit, your concerns about governance issues, all kinds of things. But fundamentally, you should be interested in cleantech because it is essentially free at the point of production. So sunlight and wind don't cost you anything. It is more efficient at the point of use, so electric systems are just fundamentally more efficient to use than keeping a tiny motor running everywhere all the time.
And finally, it fits in very well with digitalization and kind of the internet of things concept that's going to be part of the way we manage our lives in the future. If you can run the kind of electric vehicle fleet using an integration with your phone, that's something that just has a self-evident aspect to it, as far as the future goes in the future economy. And to look at, I think, there will come a time in the future when we'll look at internal combustion cars and wonder if we... they'll look crazy. It'll look like... [Laughs]a diesel-powered engine.
Hill: A horse.
Peter: Yeah. It will look like having a diesel-powered engine on your laptop. It's like, it'll look steampunk that way. People will be amazed that we ever drove around with little gas-filled motors on the front of our cars.
Hill: So what about, what are the other thing in terms of kind of following the market? Some of the media coverage of the summit, I think some of the major papers pointed out that greenhouse gas from power plant emissions have dropped 36% over the past 10 years 2010, 2020. And a lot of that was on the back of shale gas, or fracking. And our electricity prices at the same period have dropped some 15%. And so you've had this perfect storm of consumers winning, the ozone winning, the US went winning from the supply security standpoint. We can get into there was a lot of kind of government stuff, details that led to shale gas in the first place. Natural gas isn't clean tech, right? Where does natural gas fit into this equation? And does the administration...?
Hill: Was there some sort of ambivalence with how to deal with a cleaner-burning fossil fuel?
Peter: Yeah. Natural gas has a role to play. I mean it's, the used to be called the bridge fuel. I feel like that terminology has people backed away from it recently. Ironically, I think some of the ways that the sort of Biden American jobs-plan funding would work might actually maintain the use of natural gas for longer than it might otherwise. Just because it will depress power prices in certain areas, and kind of create these renewable energy islands. And sort of inter-linkages between those will need to be fueled by something? It will be fueled by natural gas. Yeah, I think natural gas has a role to play here and it will continue to be part of the solution. Natural gas becomes cleantech in a way if you want to really stretch it when you can offset it either technologically or through financial mechanism, and you can do that at a large enough scale.
So I think this is where if you're an investor, the cleantech thesis has interesting sort of offshoots. You can say,"I'm interested in carbon capture and storage," which is clearly a cleantech thesis as it fits with natural gas infrastructure. Then that becomes an interplay. I think something else we've seen is the concept of LNG into hydrogen. And so you have liquefied natural gas being made into hydrogen. So if you bill, use the LNG revenue stream today, to build out infrastructure that is capable of handling hydrogen, which is harder to handle than natural gas, then you're ready to become a hydrogen company rather than a natural gas company. So everything is in this interesting transition point, and it's really about looking for where those technological and financial tipping points are.
Hill: So I guess another question on this, in terms of kind of the timing of this, in a sense, campaign kind of moving to action. And from an investor standpoint, if we look at some of these other presidential kinds of big-bets, FDR, LBJ, whatever have done. That they were done with traditional bills from Congress that moved to a signature and have certain permanence or certain tenure with them. That they weren't executive orders.
Personally, executive orders drive me bananas, and I would imagine that they drive investors bananas because every four years the bet that you made, or the decision that you made on that executive order could be undone. We're seeing that now in the 1st 100-125 days of Biden. We saw it with several presidents before going all the way back to, I don't know when the first order was. We've already seen one executive order tied to the uh the emissions, or I guess what was that... the Congressional Review Act? That will change the way emissions from, fugitive emissions from gas and oil wells were handled. Do we expect this to be a more deliberate process that goes through the traditional congressional channels and has more permanence? Or there are things where we should look for executive orders to really drive momentum before the political will is there for more permanent policy?
Peter: Yeah. I mean there's, what are the prospects for the american jobs plan that is? And the other big Biden legislative push is that it is frankly an open question, but one that we will probably see settled in the coming months. To me the most interesting question having watched financial firms and energy companies interact with Washington for a couple of decades now, is what happens with policy at the agency level? So whether that's derived from an executive order, legislation, or court cases. And here's some place where administrative law judges for example have an incredible amount of power. If the way that policy is implemented at the agency is the way that it will really affect an investor's bottom line or an operator's bottom line.
A good example is the Dodd-Frank. That was legislation. It went through the whole process, was passed by Congress, signed by the president, and went into force. And because some of the agencies involved were just too slow or not that interested in enforcing it, there are still remaining statutes over a decade later that are are not enforced as envisioned. So I would recommend to any investor interested in how this will play out as an interaction between their investment thesis and an open policy question, to pay more attention to what's going on at the agency and commission level necessarily than what's going on in the kind of broader political headline environment.
Hill: Are those agencies able to act ahead of any sort of activity within Congress? o\Or do they need to wait on some sort of signature, whether it be a full legislative rewrite or not?
Peter: They have a surprising amount of leeway I would say, that a lot of what people think can only be done by Congress is actually done at the agency level. Of Congressional... the law is the law. These agencies and commissions are prohibited from doing some things, or allowed to do others under laws passed by Congress, but the way that they implement it was like the paragraph in the middle of those 2000 page bills. That is really crucial to an individual projects prospects.
And so again, it's more about knowing what the kind of environment to use the word, at a particular agency is who the people in charge of that agency are. That's going to be much more crucial to the fate of any individual project or investment.In a way that I think it can get very easily... people get very easily wrapped up in the drama of Capitol Hill, and lobbying, and the legislative packages. It's important for sure, it sets the law. But when it really comes down to it, you should be paying attention to what's happening at the Federal Energy Regulatory Commission, the Commodity Futures Trading Commission, the Department of Commerce. You know these agencies that are easy to ignore EPA, all of those.
Hill: So thinking about timing, I mean there's two kind of almost... finish line is the wrong word. But if this is a transformative decade and we've got to act quickly coming up over the next six months, we've got the G20 I think on Halloween, right around the time period of Halloween. Followed, I guess immediately by, like immediately to the day, by the COP26 for the UN Climate Change Conference of the parties. I guess one question, are people flying quite literally from one conference to the other? Or are these new conversations with new individuals ? And do we expect action from the US side before either of those things happen?
Peter: Yes to all three of those questions.
Peter: I think if you are in this space and you are interested in it, don't plan to take any time off in September, October, November. Those are the three big months. Because we're looking at September to be the time frame for any legislative action that does happen to go back to the Biden plan. We're looking at the G20 for and to some degree the UN General Assembly which also happens in September in New York. So there's the Biden plan, the UN General Assembly, the G20, as you say right before COP26, then COP26 in early November in Glasgow.
At each of those you're going to see major, major action I think. It would be truly surprising in a real, be seen as a really big failure, I think if at the G20 there was not significant action on tying sort of broader commitments, multilateral commitments to ground level policy and action among the G20. And then COP26, which will be a much larger event just in terms of the number of people who go, and the number of interested parties. To then see a great deal, a huge number of like announcements, and actions, and financings. And all the kind of implementation pieces of those multilateral commitments linked to national policy, linked to what's actually going to happen on the ground.
Hill: And do we expect the US to arrive at both events? Being able to look back and say, "Look at what we just got through in the US." Or is it somebody going to be arriving at the event and say, "Look at what we're working on. We need to help set a framework." Is there...?
Peter: I think we're past frameworks at this point. I mean, I think again, if there is not some major meaningful movement, some actual commitment written into law or policy at that point, not only in the United States but across the major economies, I think that the participants will view it as a failure.
Hill: All right.That is I think a good place for us to leave. And I found this conversation pretty fascinating, so thank you for joining another podcast.
Peter: It's always great to talk to you.
Hill: And we will talk with you again soon, if you were nice enough to join us back.
Hill: All right.
Peter: Thank you.
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