1 00:00:00,160 --> 00:00:02,120 Speaker 1: In a troubled and busy world. Good and science and 2 00:00:02,200 --> 00:00:04,640 Speaker 1: valuable of course. So let's get about the place, the States, 3 00:00:04,640 --> 00:00:06,760 Speaker 1: to Europe, to China, to the war. A little bit 4 00:00:06,760 --> 00:00:09,240 Speaker 1: of plain spotting maybe to boot Richard Quist of Quist 5 00:00:09,280 --> 00:00:12,000 Speaker 1: means business in Quist's world of wonder on seeing in 6 00:00:12,160 --> 00:00:14,080 Speaker 1: is with us from New York. Very good morning to you. 7 00:00:14,280 --> 00:00:16,680 Speaker 2: A very good morning or good afternoon, I should say, 8 00:00:16,680 --> 00:00:17,279 Speaker 2: from New York. 9 00:00:17,560 --> 00:00:19,079 Speaker 1: I want to cover a bunch of bases with you 10 00:00:19,120 --> 00:00:21,440 Speaker 1: this morning if we could. The great Fed debate what's 11 00:00:21,480 --> 00:00:24,760 Speaker 1: your feel? What's the feel of the FID when they move? 12 00:00:24,920 --> 00:00:28,560 Speaker 1: Had they lifted too late, had they managed the soft landing? 13 00:00:28,720 --> 00:00:29,440 Speaker 1: What's your call? 14 00:00:30,400 --> 00:00:33,760 Speaker 2: Yeah, that is a big question. The fact that they're 15 00:00:33,800 --> 00:00:37,360 Speaker 2: going to move in September, I think is beyond doubt. 16 00:00:37,760 --> 00:00:41,720 Speaker 2: If they did not move, then firstly they should all 17 00:00:41,760 --> 00:00:44,519 Speaker 2: be fired because they have led us down the garden 18 00:00:44,600 --> 00:00:48,280 Speaker 2: path believing that a rate cut of either certainly a 19 00:00:48,360 --> 00:00:52,199 Speaker 2: quarter possibly a half percent is on its way. And 20 00:00:52,240 --> 00:00:55,720 Speaker 2: the one rule is you don't lull the markets and 21 00:00:55,760 --> 00:00:59,200 Speaker 2: invest it into a false sense of security. So the 22 00:00:59,680 --> 00:01:03,320 Speaker 2: Fed has pretty much set the stage for a rate 23 00:01:03,400 --> 00:01:08,000 Speaker 2: cut later this month. Whether they've left it too late 24 00:01:08,480 --> 00:01:10,840 Speaker 2: will be only something we can judge in the rear 25 00:01:10,920 --> 00:01:14,080 Speaker 2: view mirror it started. I mean, if you look at 26 00:01:14,080 --> 00:01:17,800 Speaker 2: PMI numbers, you look under the hood of the economic data, 27 00:01:18,240 --> 00:01:21,840 Speaker 2: there is strong suggestion that it is late, and that 28 00:01:23,000 --> 00:01:27,480 Speaker 2: I mean a technical recession. Who knows, but people are hurting, 29 00:01:27,840 --> 00:01:32,200 Speaker 2: whether it's from inflation or a rise in unemployment which 30 00:01:32,240 --> 00:01:34,760 Speaker 2: is going up faster than they fed would like. Now, 31 00:01:35,640 --> 00:01:39,240 Speaker 2: there was a fine balance to be done, and it 32 00:01:39,319 --> 00:01:42,080 Speaker 2: is not clear that they got it entirely right. 33 00:01:42,480 --> 00:01:44,600 Speaker 1: When I look at the markets on a daily basis, 34 00:01:44,640 --> 00:01:47,360 Speaker 1: and no one's looked looking closer than you. How much 35 00:01:47,360 --> 00:01:48,960 Speaker 1: of what's going on in the markets at the moment 36 00:01:48,960 --> 00:01:52,080 Speaker 1: of the fundamentals of the American economy reflected by the 37 00:01:52,080 --> 00:01:55,280 Speaker 1: global economy, and how much of it's just weird behavior 38 00:01:55,320 --> 00:01:56,520 Speaker 1: around things like nvideo. 39 00:01:57,080 --> 00:02:03,640 Speaker 2: Well, you say weird behavior around in but the Nvidia 40 00:02:04,000 --> 00:02:09,680 Speaker 2: has become the bell weather for tech and AI and 41 00:02:09,919 --> 00:02:12,760 Speaker 2: therefore the ramp up in a video it's still not 42 00:02:12,840 --> 00:02:17,400 Speaker 2: well thane percent the share price this year. The issue 43 00:02:17,440 --> 00:02:22,120 Speaker 2: within Vidia and with all those stocks is whether the 44 00:02:22,320 --> 00:02:28,040 Speaker 2: economic conditions, the trading conditions, can justify those lofty valuations, 45 00:02:28,760 --> 00:02:32,480 Speaker 2: putting it crudely, Mike, Are we back to good old 46 00:02:32,600 --> 00:02:37,200 Speaker 2: fashioned earnings per share? The share price is a metrics 47 00:02:37,400 --> 00:02:41,600 Speaker 2: of future earnings. Are we back to good old valuations? 48 00:02:41,960 --> 00:02:47,440 Speaker 2: And what is happening is not a crisis allah global debt, 49 00:02:47,880 --> 00:02:53,520 Speaker 2: or allah pandemic or the Great Recession. It's not that crisis. 50 00:02:53,720 --> 00:02:59,280 Speaker 2: This is the market doing its proper due diligence and saying, 51 00:02:59,600 --> 00:03:04,560 Speaker 2: you know, we thought in Vidia, Cisco, Intel, we thought 52 00:03:04,600 --> 00:03:08,440 Speaker 2: the chip makers were going to do better. The evidence 53 00:03:08,520 --> 00:03:12,160 Speaker 2: is suggesting they'll still do well, but not well enough 54 00:03:12,160 --> 00:03:15,160 Speaker 2: to justify these prices. And where this is a long 55 00:03:15,200 --> 00:03:17,360 Speaker 2: way yeah, go ahead. 56 00:03:17,440 --> 00:03:19,040 Speaker 1: Now, I was going to say, well, where did the 57 00:03:19,080 --> 00:03:21,480 Speaker 1: geopolitics of all of this fit into this? When I 58 00:03:21,600 --> 00:03:25,080 Speaker 1: look at a place like China, Canada, Canola Royal this week, 59 00:03:25,240 --> 00:03:28,440 Speaker 1: back and forth, the geopolitics and the uncertain nature of 60 00:03:28,480 --> 00:03:31,639 Speaker 1: the world, where do they fit into wall with this, Well, they. 61 00:03:31,760 --> 00:03:35,560 Speaker 2: Fit into it in creating the economic landscape by which 62 00:03:35,600 --> 00:03:39,360 Speaker 2: everybody's trading again put on the left side of the 63 00:03:39,400 --> 00:03:43,080 Speaker 2: garden fence, put tech and in Nvidia on the right side. 64 00:03:43,240 --> 00:03:47,240 Speaker 2: Put a potential bigger slow down than was expected. In 65 00:03:47,280 --> 00:03:51,440 Speaker 2: the US, put problems and protectionism with China. Put a 66 00:03:51,600 --> 00:03:55,120 Speaker 2: US election where there will be tariffs. Whoever gets elected 67 00:03:55,280 --> 00:03:58,880 Speaker 2: put problems in Europe and within the EU. Now that 68 00:03:58,920 --> 00:04:02,000 Speaker 2: creates a slow down, which again means that you can't 69 00:04:02,240 --> 00:04:08,520 Speaker 2: justify these share prices. And it implicates the tech because 70 00:04:08,600 --> 00:04:12,160 Speaker 2: suddenly companies are not going to invest in tech and 71 00:04:12,320 --> 00:04:16,600 Speaker 2: AI like we thought they will. It's not it's not 72 00:04:16,680 --> 00:04:21,000 Speaker 2: a crisis, and it's not a very fast moving downward spiral. 73 00:04:21,400 --> 00:04:24,760 Speaker 2: But they are feeding into each other and that's why 74 00:04:24,800 --> 00:04:28,559 Speaker 2: there is this unease, this worry that's out there. 75 00:04:29,120 --> 00:04:31,880 Speaker 1: You mentioned tariffs in the election. Generally speaking, where does 76 00:04:31,920 --> 00:04:33,040 Speaker 1: the election fit in. 77 00:04:34,680 --> 00:04:39,400 Speaker 2: Good question? We know that tariffs are coming regardless of 78 00:04:39,520 --> 00:04:42,520 Speaker 2: who wins. If it's Donald Trump, they'll be broad based. 79 00:04:42,800 --> 00:04:45,039 Speaker 2: There will be a you know, across the board, and 80 00:04:45,080 --> 00:04:48,400 Speaker 2: they will be deep and painful. If it's Kanla Harris, 81 00:04:48,520 --> 00:04:50,960 Speaker 2: they will be more targeted against China. They'll be more 82 00:04:51,000 --> 00:04:53,600 Speaker 2: tip related, they'll be more tech related, they'll be more 83 00:04:53,640 --> 00:04:58,640 Speaker 2: protectionists in the sense, in a sort of a tighter sense. 84 00:04:59,000 --> 00:05:02,560 Speaker 2: And remember Joe Biden did not remove most of Donald 85 00:05:02,600 --> 00:05:06,440 Speaker 2: Trump's former tariffs that he puts in place, or former 86 00:05:06,480 --> 00:05:11,400 Speaker 2: president tax on the economic front. We just don't know 87 00:05:11,440 --> 00:05:14,000 Speaker 2: how either of them are going to pay for their plans. 88 00:05:14,400 --> 00:05:16,240 Speaker 2: We don't know how Donald Trump is going to pay 89 00:05:16,240 --> 00:05:19,200 Speaker 2: for his tax cuts. We don't know how Kamala Harris 90 00:05:19,320 --> 00:05:23,599 Speaker 2: is going to pay for her increased social spending. Not 91 00:05:24,000 --> 00:05:28,160 Speaker 2: to be blunt, do we have any idea about the 92 00:05:28,200 --> 00:05:32,839 Speaker 2: ability the proprietary the simple common sense of her price 93 00:05:32,960 --> 00:05:36,839 Speaker 2: gouging policies which seem to make no sense whatsoever. 94 00:05:37,360 --> 00:05:40,839 Speaker 1: Deedan will look forward to the debate tomorrow afternoon, right Richard. 95 00:05:40,920 --> 00:05:43,800 Speaker 1: The wars, the complexity of them ties in with the elections. 96 00:05:43,839 --> 00:05:46,680 Speaker 1: Of course, America's approach to the wars, the funding of 97 00:05:46,720 --> 00:05:49,039 Speaker 1: the equipment, the cost of all of the rising dit 98 00:05:49,040 --> 00:05:52,480 Speaker 1: what changes if there's a change of president. With Europe 99 00:05:52,480 --> 00:05:53,440 Speaker 1: and the Middle East. 100 00:05:53,920 --> 00:05:57,599 Speaker 2: I think the Middle East less. So Ukraine's going to 101 00:05:57,640 --> 00:06:01,400 Speaker 2: be the big one because if Donald Trump is elected, 102 00:06:01,920 --> 00:06:06,320 Speaker 2: then his ability and capacity to continue to support Ukraine 103 00:06:06,760 --> 00:06:10,119 Speaker 2: is very much in doubt now to a certain extent, 104 00:06:10,120 --> 00:06:13,520 Speaker 2: though US still will it's a NATO the US will 105 00:06:13,640 --> 00:06:16,400 Speaker 2: and NATO still will do, but it will be a 106 00:06:16,400 --> 00:06:19,560 Speaker 2: lot more painful for Ukraine. And there are we serious 107 00:06:19,600 --> 00:06:22,960 Speaker 2: questions on Gaza and the Middle East. If if Kamala 108 00:06:23,040 --> 00:06:25,919 Speaker 2: Harris is elected. Well, then of course you've got problems 109 00:06:25,960 --> 00:06:31,240 Speaker 2: of the progressive left within the Democrats economically, because I 110 00:06:31,240 --> 00:06:34,640 Speaker 2: think that's what you're talking about, no real changes and 111 00:06:34,760 --> 00:06:38,520 Speaker 2: less as an exogenous event that would cause oil prices 112 00:06:38,560 --> 00:06:43,680 Speaker 2: to rise or supply lines to become disrupted. We are already, 113 00:06:43,800 --> 00:06:47,599 Speaker 2: Mike adapting. I was talking to the CEO of Mirth 114 00:06:47,960 --> 00:06:51,000 Speaker 2: and they are already adapting to the fact that the 115 00:06:51,040 --> 00:06:53,800 Speaker 2: Red Sea might be out of operation for quite some 116 00:06:53,880 --> 00:06:58,320 Speaker 2: time to get from Asia through up until Europe longer term. 117 00:06:58,520 --> 00:07:01,839 Speaker 2: If there's an exousous event, if the wars get worse, 118 00:07:02,560 --> 00:07:07,080 Speaker 2: if oil and other supply lines become endangered, then I 119 00:07:07,120 --> 00:07:09,880 Speaker 2: think you're looking at some really serious economic problems. 120 00:07:10,040 --> 00:07:12,320 Speaker 1: And then, Richard, what about Europe and what we've seen 121 00:07:12,360 --> 00:07:14,640 Speaker 1: in Germany and whether what we've seen in Germany is 122 00:07:14,680 --> 00:07:17,360 Speaker 1: reflected more broadly in Europe And if it is, what 123 00:07:17,480 --> 00:07:18,520 Speaker 1: then for Europe. 124 00:07:18,960 --> 00:07:22,240 Speaker 2: Well, let's just look at this. And you're talking of 125 00:07:22,240 --> 00:07:24,480 Speaker 2: course about the AfD and sort of the shift to 126 00:07:24,520 --> 00:07:27,120 Speaker 2: the right, and we saw it in Italy with the 127 00:07:27,200 --> 00:07:29,800 Speaker 2: line Eders. It's a couple of years ago and we've 128 00:07:29,840 --> 00:07:34,400 Speaker 2: seen it. Of course, we've seen Victor Auban holding onto power, 129 00:07:34,600 --> 00:07:36,880 Speaker 2: although that is certainly less so. But then you have 130 00:07:37,040 --> 00:07:43,160 Speaker 2: Poland where Donald Tusk came back. The European election, the 131 00:07:43,200 --> 00:07:49,200 Speaker 2: parliamentary results has given pause for thought. How President vonder 132 00:07:49,320 --> 00:07:54,000 Speaker 2: lyon and the new President of the Council, And you 133 00:07:54,000 --> 00:07:59,080 Speaker 2: know it's a measure of just you could ask most 134 00:07:59,120 --> 00:08:01,520 Speaker 2: people in Europe who the new President of the Council 135 00:08:01,640 --> 00:08:04,280 Speaker 2: is and even I can't remember his name just at 136 00:08:04,280 --> 00:08:07,080 Speaker 2: the moment, where without looking it up to just remind myself, 137 00:08:08,200 --> 00:08:11,640 Speaker 2: you've got to ask yourself what role this is all 138 00:08:11,640 --> 00:08:15,120 Speaker 2: going to play, particularly if Europeans are angry. 139 00:08:16,720 --> 00:08:18,320 Speaker 1: Do you see a reap fact. 140 00:08:18,160 --> 00:08:20,840 Speaker 2: In fact in Fama. In fact, let me just point out, 141 00:08:20,920 --> 00:08:25,560 Speaker 2: you say, the the the haven of stability at the moment, 142 00:08:25,640 --> 00:08:29,360 Speaker 2: despite all the problems in the UK economy, might be 143 00:08:29,400 --> 00:08:34,520 Speaker 2: written because the election is out the way, Kirstarmer is 144 00:08:34,520 --> 00:08:37,400 Speaker 2: is in number ten and is likely to be with 145 00:08:37,520 --> 00:08:41,320 Speaker 2: a very strong majority. So we've seen US bonds guilts 146 00:08:42,160 --> 00:08:45,559 Speaker 2: rally quite sharply because the and in fact, the demand 147 00:08:45,720 --> 00:08:52,120 Speaker 2: for guilts in the last bond auction dramatically dramatically outstripped 148 00:08:52,200 --> 00:08:54,960 Speaker 2: supply because people want to hold where there is perceived 149 00:08:54,960 --> 00:08:55,720 Speaker 2: to be stability. 150 00:08:56,120 --> 00:08:58,280 Speaker 1: I was just going to ask about Takios Stama. I 151 00:08:58,320 --> 00:09:00,600 Speaker 1: can't work out what I'm seeing here. On one Handy's 152 00:09:00,600 --> 00:09:03,880 Speaker 1: cutting heating to patroners, which seems a very conservative sort 153 00:09:03,920 --> 00:09:05,280 Speaker 1: of thing for a liber government to do because they 154 00:09:05,280 --> 00:09:06,760 Speaker 1: haven't got any money. And then on the other hand, 155 00:09:06,800 --> 00:09:09,400 Speaker 1: he's wandering into the back of the pub garden telling 156 00:09:09,440 --> 00:09:11,520 Speaker 1: you you can't smoke, which is a very progressive liber 157 00:09:11,559 --> 00:09:13,240 Speaker 1: sort of thing. What sort of government are they? 158 00:09:13,840 --> 00:09:19,480 Speaker 2: I think I would say, Secure has got you exactly 159 00:09:19,880 --> 00:09:25,640 Speaker 2: where he wants to be, exactly. He would say, I'm 160 00:09:25,640 --> 00:09:28,520 Speaker 2: a you know, I have policies and they are pragmatic 161 00:09:28,840 --> 00:09:33,480 Speaker 2: policies that I will follow as necessary with certain values. 162 00:09:33,880 --> 00:09:37,079 Speaker 2: For instance, the British government has today got to increase 163 00:09:37,240 --> 00:09:40,520 Speaker 2: pensions by more than the rate of inflation because they 164 00:09:40,679 --> 00:09:44,080 Speaker 2: have signed onto and adhere to the so called triple lock. 165 00:09:44,400 --> 00:09:48,600 Speaker 2: That's very expensive for them. Does it make sense to 166 00:09:48,720 --> 00:09:53,800 Speaker 2: remove the winter fuel allowance economically? Probably does. Most pensioners 167 00:09:53,840 --> 00:09:57,440 Speaker 2: didn't need it. Why not make it means tested? But 168 00:09:57,520 --> 00:10:00,640 Speaker 2: it had become part of the fabric of winter pensioners, 169 00:10:00,920 --> 00:10:04,120 Speaker 2: and for a labor government to take it away it 170 00:10:04,280 --> 00:10:08,800 Speaker 2: was just. It was sordid and a little bit sleazy. 171 00:10:08,559 --> 00:10:11,920 Speaker 1: Exactly, just an overarching thing to end. Richard, as an 172 00:10:11,960 --> 00:10:14,360 Speaker 1: observer of all of this for an extended period of 173 00:10:14,360 --> 00:10:16,520 Speaker 1: time and expert in the field, do you find the 174 00:10:16,559 --> 00:10:21,120 Speaker 1: world particularly interesting, weird and unusual at the moment or 175 00:10:21,160 --> 00:10:23,240 Speaker 1: are we sort of just getting a bit excited and 176 00:10:23,240 --> 00:10:24,559 Speaker 1: it's always been this way if you. 177 00:10:24,520 --> 00:10:28,240 Speaker 2: Look economically, I think we're fine economically being a moment 178 00:10:28,240 --> 00:10:30,320 Speaker 2: where we came from in twenty twenty with the pandemic, 179 00:10:30,520 --> 00:10:32,920 Speaker 2: I think we're just about fine. Some countries will grow 180 00:10:32,960 --> 00:10:35,440 Speaker 2: more than others. You know, the fact that we have 181 00:10:35,559 --> 00:10:38,679 Speaker 2: proven we can get rid of inflation. Arguably we should 182 00:10:38,679 --> 00:10:40,120 Speaker 2: never have had it. We should have been more careful, 183 00:10:40,160 --> 00:10:42,280 Speaker 2: blah blah blah. You know, could I should have, would have. 184 00:10:42,559 --> 00:10:47,360 Speaker 2: But the biggest worry has to be the war in Ukraine, 185 00:10:47,840 --> 00:10:50,480 Speaker 2: the potential worsening of the Middle East and expansion of 186 00:10:50,480 --> 00:10:54,240 Speaker 2: the Middle East war and the Taiwan Strait and the 187 00:10:54,640 --> 00:10:57,240 Speaker 2: battle within you know, the battles that will happen in 188 00:10:57,880 --> 00:11:05,200 Speaker 2: Asia with China. Those have the serious potential to just 189 00:11:05,400 --> 00:11:11,679 Speaker 2: completely literally blow us out of the water. Wider issues 190 00:11:11,760 --> 00:11:14,040 Speaker 2: might if I give you one sort of post summer 191 00:11:14,080 --> 00:11:17,440 Speaker 2: here as you thought, wider issues, how we're going to 192 00:11:17,480 --> 00:11:22,640 Speaker 2: deal with social media and AI. You know, how do 193 00:11:22,679 --> 00:11:27,200 Speaker 2: we teach a generation that what they see might not 194 00:11:27,320 --> 00:11:30,960 Speaker 2: be accurate and fair and true, what they hear might 195 00:11:31,040 --> 00:11:34,320 Speaker 2: not be the real thing to their ears, and what 196 00:11:34,360 --> 00:11:36,600 Speaker 2: they're being told they're going to have to take with 197 00:11:36,679 --> 00:11:40,000 Speaker 2: a pinch of salt. How do we tell people who 198 00:11:40,080 --> 00:11:45,400 Speaker 2: are skeptical, cynical, and downright disbelievers to believe Mike Hoskins 199 00:11:45,400 --> 00:11:47,760 Speaker 2: because he's been doing it more years than he's honest. 200 00:11:47,960 --> 00:11:50,600 Speaker 2: He knows what he's talking about, and to believe rich 201 00:11:50,600 --> 00:11:53,760 Speaker 2: request because he does know what he's talking about, and 202 00:11:53,800 --> 00:11:57,120 Speaker 2: they are not just shills if you will, of Corporate 203 00:11:57,160 --> 00:11:59,200 Speaker 2: America or New Zealand or whatever. 204 00:12:00,120 --> 00:12:02,400 Speaker 1: You get the answer, let us know and we'll award 205 00:12:02,440 --> 00:12:03,040 Speaker 1: you the no Bell. 206 00:12:04,280 --> 00:12:06,040 Speaker 2: But I got the answer. I'm keeping it to myself. 207 00:12:07,000 --> 00:12:09,280 Speaker 1: Nice to catch up Richard Quest out of CNN. 208 00:12:10,000 --> 00:12:12,920 Speaker 2: For more from the Mic Asking Breakfast, listen live to 209 00:12:13,000 --> 00:12:13,600 Speaker 2: news talks. 210 00:12:13,600 --> 00:12:16,760 Speaker 1: It'd be from six am weekdays, or follow the podcast 211 00:12:16,800 --> 00:12:17,640 Speaker 1: on iHeartRadio.