WEBVTT - Bloomberg Surveillance TV: November 5th, 2025 0:00:02.400 --> 0:00:06.760 Bloomberg Audio Studios, Podcasts, radio News. 0:00:11.680 --> 0:00:15.480 This is the Bloomberg Surveillance Podcast. I'm Jonathan Ferrow, along 0:00:15.520 --> 0:00:18.720 with Lisa Bromwitz and Amerie Hordert. Join us each day 0:00:18.760 --> 0:00:22.280 for insight from the best in markets, economics, and geopolitics 0:00:22.440 --> 0:00:24.880 from our global headquarters in New York City. We are 0:00:24.960 --> 0:00:27.680 live on Bloomberg Television weekday mornings from six to nine 0:00:27.720 --> 0:00:31.319 am Eastern. Subscribe to the podcast on Apple, Spotify or 0:00:31.320 --> 0:00:33.960 anywhere else you listen, and as always on the Bloomberg 0:00:34.040 --> 0:00:36.800 Terminal and the Bloomberg Business app. As traders look for 0:00:36.800 --> 0:00:38.720 clarity on the path ahead for raid cards, the team 0:00:38.720 --> 0:00:41.000 of Morgan Stanley writer the following. We maintain our call 0:00:41.200 --> 0:00:43.599 for an additional twenty five basis point cut in December, 0:00:43.760 --> 0:00:46.080 but the key question is what the data the FED 0:00:46.120 --> 0:00:49.400 will actually have before December. A prolonged shutdown as a 0:00:49.440 --> 0:00:52.480 risk to our view of more consecutive cuts. Mike Gape 0:00:52.600 --> 0:00:54.840 of Matt Hornback of Morgan Stanley join us now for more. 0:00:54.960 --> 0:00:57.400 Jent's going to see you both from here morning. Michael's 0:00:57.400 --> 0:00:59.680 going to come to you first. The data we don't 0:00:59.680 --> 0:01:02.240 have my right now, dis government shutdown, it makes it 0:01:02.320 --> 0:01:04.200 less likely we get right cuts in December? 0:01:04.280 --> 0:01:04.759 Is that right? 0:01:04.840 --> 0:01:07.480 Well, I think we're just reflecting what Powell said that 0:01:07.560 --> 0:01:10.000 if you're driving a car in the fog, should you 0:01:10.040 --> 0:01:12.040 should slow down? So he was saying there is a 0:01:12.080 --> 0:01:14.720 case to be made where if you don't have the data, maybe. 0:01:14.480 --> 0:01:15.360 You can't act. 0:01:16.160 --> 0:01:18.840 My view would be that if we're still in December 0:01:18.880 --> 0:01:21.520 and the shutdowns in play and we don't have the data, 0:01:22.080 --> 0:01:24.920 I'd be really surprised if the FED doesn't cut. I 0:01:24.920 --> 0:01:27.679 think the drag from a government shutdown at that point 0:01:28.200 --> 0:01:32.160 could mean growth is essentially zero in the quarter, and 0:01:32.240 --> 0:01:35.160 I would be surprised if there weren't some spillovers in 0:01:35.240 --> 0:01:38.000 the limited data that we see. So I think if 0:01:38.800 --> 0:01:41.080 we don't have data, it's because the government shut down, 0:01:41.440 --> 0:01:43.520 and I think that probably still justifies a cut. 0:01:43.600 --> 0:01:44.880 Well, good to Matt in just one second. 0:01:44.880 --> 0:01:47.560 But Michael, from the economic perspective, do you get the 0:01:47.560 --> 0:01:49.760 sense of this is an economy that needs right cuts, 0:01:49.880 --> 0:01:52.320 especially give the fact that the slow growth, slow higher 0:01:52.480 --> 0:01:54.640 low fire kind of churn has been going on for 0:01:54.720 --> 0:01:56.280 quite a while and may have a lot to do 0:01:56.360 --> 0:01:59.640 with other factors outside of just a trajectory of US economy. 0:02:00.000 --> 0:02:02.720 So We came into the year thinking, no, you probably 0:02:02.760 --> 0:02:05.080 don't need to cut rates this year, that you would 0:02:05.080 --> 0:02:08.919 want to ensure that any inflation rise from tariffs's transitory, 0:02:08.919 --> 0:02:11.080 and then we thought the rate cuts would come in 0:02:11.120 --> 0:02:14.919 twenty twenty six. So my view is, maybe we don't 0:02:15.160 --> 0:02:18.440 need it. There's certainly a discrepancy between the data and attention, 0:02:18.600 --> 0:02:21.440 between the activity and the labor market data, but I'm 0:02:21.440 --> 0:02:23.360 not on the committee. I don't get to make the choice. 0:02:23.600 --> 0:02:26.520 The view is the balance of risks shifted and policy 0:02:26.600 --> 0:02:27.840 needs to be recalibrated. 0:02:28.600 --> 0:02:29.880 So they've made that decision. 0:02:29.919 --> 0:02:32.160 They want to move closer to neutral, and I'm just 0:02:32.200 --> 0:02:35.600 thinking that the data will justify another step in that 0:02:35.680 --> 0:02:37.520 direction in December, Matt, are you. 0:02:37.520 --> 0:02:38.240 Already seeing that? 0:02:38.400 --> 0:02:40.440 Is with respect to how the bond market is responding 0:02:40.480 --> 0:02:43.400 to recent weakness and this idea that it seems as 0:02:43.440 --> 0:02:46.560 though everyone's buying the transitory story again, they're just not saying. 0:02:46.320 --> 0:02:46.839 The T word. 0:02:47.080 --> 0:02:49.400 Well, it feels to me as if the market had 0:02:49.440 --> 0:02:52.920 to adjust its pricing for the December meeting based on 0:02:52.960 --> 0:02:54.120 what we got out of the. 0:02:54.400 --> 0:02:55.480 Meeting last week. 0:02:55.520 --> 0:02:58.800 But the market is also at the same time hesitant 0:02:58.840 --> 0:03:01.519 of completely taking the December meeting off of the table, 0:03:01.560 --> 0:03:04.800 because I think investors are starting to look at the 0:03:04.800 --> 0:03:08.440 bigger picture. They're saying, hey, twenty twenty six might be 0:03:08.480 --> 0:03:10.440 a better year, but we have to get through the 0:03:10.560 --> 0:03:13.760 end of twenty twenty five first. And the government shutdown 0:03:13.800 --> 0:03:17.440 is starting to slowly creep into the mindset of investors 0:03:17.800 --> 0:03:19.960 and they're thinking, gosh, if the data do come in 0:03:20.160 --> 0:03:24.160 on the weaker side going into the December meeting, then 0:03:24.400 --> 0:03:27.720 the Fed should very well continue its gradual move back 0:03:27.720 --> 0:03:28.560 to a neutral stance. 0:03:28.639 --> 0:03:30.160 Day thirty six, longest in history. 0:03:30.200 --> 0:03:32.480 The President is now talking to Senate Republicans saying they 0:03:32.520 --> 0:03:34.520 should just blow up the filibuster in order to do this. 0:03:34.600 --> 0:03:36.240 Is there a line in the sand where the government 0:03:36.240 --> 0:03:38.560 shutdown would need to end for you to really think 0:03:38.600 --> 0:03:40.600 that December's back on the table because all that data 0:03:40.600 --> 0:03:41.720 will start flowing through again. 0:03:42.000 --> 0:03:44.520 Well, I think to the point that Mike made, they're 0:03:44.560 --> 0:03:47.000 going to get some data. Even if the government does 0:03:47.000 --> 0:03:49.040 stay shut down for the next couple of weeks. 0:03:49.080 --> 0:03:49.920 We might not get as. 0:03:49.880 --> 0:03:53.160 Much official government data as we would like to get, 0:03:53.200 --> 0:03:55.920 but we will still get a set of economic data 0:03:55.960 --> 0:03:58.280 like the data that we got this morning. We'll get 0:03:58.320 --> 0:04:01.240 another round there, and we're going to get of course 0:04:01.280 --> 0:04:03.640 the state unemployment claims data as well, so they're going 0:04:03.680 --> 0:04:06.400 to have something to work with, and so you know, 0:04:06.440 --> 0:04:09.760 to us, it's ultimately it's going to be the totality 0:04:09.760 --> 0:04:11.480 of whatever they have in hand. 0:04:11.200 --> 0:04:13.640 That will lead them to decide what to do in December, 0:04:13.640 --> 0:04:14.720 Mikae and week on the annex. 0:04:14.840 --> 0:04:16.200 That's what we can go on, and we can talk 0:04:16.279 --> 0:04:18.400 to corporate executives, and we've spoken to a fue already 0:04:18.400 --> 0:04:21.000 this morning. One bank executive come on the program and 0:04:21.000 --> 0:04:23.640 said things are okay, better than okay, there's no real 0:04:23.720 --> 0:04:26.520 damage in our loan book, and we expect reacceleration into 0:04:26.560 --> 0:04:28.520 the new year. This runs counter to the view that 0:04:28.560 --> 0:04:30.520 you have on the labor market. Can you just flesh 0:04:30.520 --> 0:04:32.280 out what you do expect to see in the labor 0:04:32.279 --> 0:04:33.120 market the months to come. 0:04:33.400 --> 0:04:35.719 Yeah, So there's certainly a tension in the data. The 0:04:35.760 --> 0:04:39.839 activity data solid AI related spending, you know, off the charts, 0:04:39.920 --> 0:04:43.039 upper income households doing well. You were emphasizing that in 0:04:43.080 --> 0:04:46.440 the previous segment, but the labor market data looks different. 0:04:46.600 --> 0:04:49.479 So our view is we're maybe a third of the 0:04:49.520 --> 0:04:53.440 way through the process of firms passing tariffs onto the consumer, 0:04:53.520 --> 0:04:55.799 so that's going to extend at least into the first. 0:04:55.680 --> 0:04:56.720 Quarter of next year. 0:04:57.320 --> 0:05:00.400 While that's happening, I think there'll be great reluctance higher. 0:05:00.400 --> 0:05:02.719 We've seen that the low higher, low fire labor market. 0:05:02.760 --> 0:05:06.239 The ADP report's very consistent with that. So while that's 0:05:06.320 --> 0:05:09.520 going on, we think the unemployment rate creeps higher. And 0:05:09.600 --> 0:05:13.560 we have the federal workers who took the early retirement 0:05:13.600 --> 0:05:17.000 package who will be rolling off payrolls in October to 0:05:17.040 --> 0:05:19.080 the tune of about one hundred and fifty thousand. So 0:05:19.120 --> 0:05:22.120 we think the unemployment rate could finish this year around 0:05:22.160 --> 0:05:24.800 four five, four six. And if that's you know, it's 0:05:24.839 --> 0:05:27.120 not a meaningfully higher move. That's still a very low 0:05:27.200 --> 0:05:30.240 unemployment rate. But the direction of that move I think 0:05:30.640 --> 0:05:32.880 is enough for a FED chaer who says he now 0:05:32.920 --> 0:05:35.800 a little more data dependent to say, let's take another step. 0:05:35.880 --> 0:05:40.560 So modest deterioration, modest continued cooling is what we think 0:05:40.600 --> 0:05:42.200 that message will be out of the labor market. 0:05:42.360 --> 0:05:44.120 Give me for referencing your world, colleagues. I want to 0:05:44.120 --> 0:05:46.039 talk about Bank for America just a little bit. I 0:05:46.040 --> 0:05:47.680 want to talk about what Brian Moynahan's going to be 0:05:47.720 --> 0:05:50.680 discussing later on this morning. He's talking about less labor 0:05:50.680 --> 0:05:53.479 intensive revenue growth, and I wonder if we need to 0:05:53.480 --> 0:05:56.760 focus on less labor intensive GDP growth, And I just 0:05:56.800 --> 0:05:58.680 wonder what that means for the Federal Reserve. And I'm 0:05:58.680 --> 0:05:59.720 going to get to what it means for the bond 0:05:59.760 --> 0:06:01.560 market too, because I don't know if fixed incomes should 0:06:01.560 --> 0:06:04.520 trade on the jobs numbers or GDP. What's it going 0:06:04.560 --> 0:06:06.560 to mean for the Federal Reserve in the quarters to 0:06:06.560 --> 0:06:07.360 count well? 0:06:07.640 --> 0:06:10.359 It's this is also part of the fog story. 0:06:10.440 --> 0:06:13.560 This rolling in is a difficult thing to understand and 0:06:13.600 --> 0:06:16.240 manage in real time. I'm not sure in the short 0:06:16.320 --> 0:06:19.480 run it changes there thinking all that much, it'll have 0:06:19.520 --> 0:06:23.000 an implication on the labor market. If it's a supply side, 0:06:23.040 --> 0:06:27.080 productivity driven story. It'll also be something that brings inflation 0:06:27.240 --> 0:06:30.600 down right, so that it would reinforce that I'll use 0:06:30.640 --> 0:06:35.040 the T word, the transitory inflation story. It would reinforce that. 0:06:35.160 --> 0:06:37.320 I think it would give you more confidence that inflation 0:06:37.400 --> 0:06:41.000 should be coming back down. And if anything, it would 0:06:41.400 --> 0:06:44.800 leave this kind of load dynamic labor market in place. 0:06:44.960 --> 0:06:47.480 I think both of those would say the Fed will 0:06:47.520 --> 0:06:48.839 have a gradual easing bias. 0:06:48.880 --> 0:06:51.320 If this has market consequences, of course, yes, if you 0:06:51.320 --> 0:06:52.920 look at payros, there should be some kind of loose 0:06:53.000 --> 0:06:55.719 relationship between what happens with jobs and what happens with earnings. 0:06:55.760 --> 0:06:57.200 But this year, at least, we've managed to have a 0:06:57.200 --> 0:06:59.640 massive step down in jobs growth and earnest growth has 0:06:59.680 --> 0:07:03.360 been obsolutely fantastic. So equity lands can ignore what happens 0:07:03.360 --> 0:07:05.839 with jobs? Can the bond market? What should the bond 0:07:05.839 --> 0:07:08.599 markets right on jobs? So GDP, Well, the bond market 0:07:08.720 --> 0:07:11.680 typically trades on the Fed. So if the Fed is 0:07:11.720 --> 0:07:15.560 going to continue to lower its policy rate, then you 0:07:15.560 --> 0:07:18.160 would expect the bond market to trade in kind. Now 0:07:18.480 --> 0:07:20.680 we all know that the bond market is priced for 0:07:20.800 --> 0:07:23.800 a very gradual easing of policy. 0:07:24.240 --> 0:07:27.080 The issue, though, is if the Fed delivers. 0:07:26.720 --> 0:07:29.800 On what the market forwards are telling you today about 0:07:29.840 --> 0:07:32.320 the path of Fed policy. It's not as if the 0:07:32.320 --> 0:07:34.920 market forwards are just going to sit there and shrug 0:07:34.960 --> 0:07:38.360 their shoulders. They're going to move and that's the typical 0:07:38.360 --> 0:07:41.480 behavior in the bond market. When the Fed follows the forwards, 0:07:41.480 --> 0:07:44.200 the forwards don't sit there. They keep moving in that 0:07:44.240 --> 0:07:47.360 same direction. So from our vantage point, if the FED 0:07:47.400 --> 0:07:50.440 delivers an easing cycle in line with what Mike believes 0:07:50.440 --> 0:07:52.920 and in line with close to what the market forwards 0:07:52.960 --> 0:07:55.760 are pricing, the forwards are going to keep moving and 0:07:55.800 --> 0:07:59.320 that's going to continue to weigh on bond yields. Already, 0:07:59.360 --> 0:08:02.440 we have a your yield right around four percent. We're 0:08:02.440 --> 0:08:03.840 the only house on the street that I thought that 0:08:03.840 --> 0:08:06.760 would happen this year. So as the FED continues to deliver, 0:08:06.920 --> 0:08:08.800 we do think that bond yields will continue to fall. 0:08:08.960 --> 0:08:11.239 At what point are you starting to get more concerned 0:08:11.280 --> 0:08:14.800 about longer term inflation and a longer term pushback. 0:08:14.400 --> 0:08:17.280 In US treasuries? I'm looking right now. 0:08:17.320 --> 0:08:22.200 Mike pointed out Michael McKee parsing through the auctionary funding announcement, 0:08:22.320 --> 0:08:25.480 pointing out that they do plan to increase their T 0:08:25.680 --> 0:08:30.600 bills and their low duration instruments, and there's this feeling 0:08:30.600 --> 0:08:32.840 that the Fed's going to monetize, that the Fed's going 0:08:32.880 --> 0:08:35.720 to increasingly buy that debt, call it whatever you will, 0:08:35.960 --> 0:08:38.800 in order to keep rates low while also pegging rates 0:08:38.880 --> 0:08:41.040 to a fairly low level. At what point does that 0:08:41.120 --> 0:08:44.679 pose a risk to longer term treasuries and the potential 0:08:44.960 --> 0:08:48.840 for this to backfire in terms of some investor appetite. 0:08:48.960 --> 0:08:49.520 Yeah, I think. 0:08:50.080 --> 0:08:52.680 I think you're talking about the bond vigilantes that show 0:08:52.760 --> 0:08:55.440 up every now and again and typically lose money at 0:08:55.480 --> 0:08:58.360 the end of the day. You know, from my vantage point, 0:08:58.760 --> 0:09:01.480 you know, we're going to have to see in the data. Okay, 0:09:01.559 --> 0:09:04.840 if the FED is lowering interest rates and inflation is 0:09:04.840 --> 0:09:07.400 moving higher, that would be the type of environment that 0:09:07.440 --> 0:09:10.280 I think would get bond investors very, very nervous. We're 0:09:10.280 --> 0:09:12.960 not really seeing that, right, We're seeing a committee that 0:09:13.080 --> 0:09:17.320 is divided on what to do in this inflationary environment. 0:09:17.360 --> 0:09:20.760 But if the inflationary environment turns out as we're forecasting, 0:09:21.679 --> 0:09:26.240 people should be very relaxed about owning high quality duration 0:09:26.480 --> 0:09:28.360 and the bond market. And by the way, just on 0:09:28.480 --> 0:09:32.240 the Treasury refunding that happened this morning, that's very much 0:09:32.240 --> 0:09:34.959 in line with our projections, not just for this refunding, 0:09:35.400 --> 0:09:38.680 but for the next several refundings. We don't believe that 0:09:38.760 --> 0:09:41.920 the US Treasury is going to increase their coupon issuance 0:09:42.360 --> 0:09:44.360 until February of twenty twenty seven. 0:09:44.840 --> 0:09:45.560 I mean, for all. 0:09:45.400 --> 0:09:47.560 Intents and purposes, that's a lifetime away. And a lot 0:09:47.640 --> 0:09:50.080 of things will happen between now and then, so we 0:09:50.120 --> 0:09:54.640 don't really see an issuance problem for the investor base 0:09:54.840 --> 0:09:56.160 and for the bond market. 0:09:56.520 --> 0:09:59.000 Mike, I'm just wondering what's the fuzz mandate right now, 0:09:59.240 --> 0:10:02.680 because if the man date is low unemployment, then right 0:10:02.720 --> 0:10:05.560 now you could make an argument that maybe it is 0:10:05.880 --> 0:10:08.360 a positive thing for them to ease, but if it's 0:10:08.400 --> 0:10:13.200 for financial stability and the idea of inflation acid price 0:10:13.240 --> 0:10:15.680 inflation will at some point trickle into the real economy, 0:10:15.760 --> 0:10:18.760 especially in AI and energy costs and some of these 0:10:18.800 --> 0:10:22.480 other kinds of issues. How do you square whether they're 0:10:22.480 --> 0:10:24.920 potentially adding fuel to the fire. 0:10:24.960 --> 0:10:28.320 Well, and they're risking that right They are taking out 0:10:28.360 --> 0:10:31.839 insurance right now against what they see is downside risk 0:10:31.920 --> 0:10:36.160 to employment, and insurance comes at a cost, and that 0:10:36.360 --> 0:10:38.800 cost is what you just mentioned, the risk of higher 0:10:38.800 --> 0:10:42.160 inflation over time, that you're a more inflation tolerant fed 0:10:43.040 --> 0:10:48.080 or you fuel animal spirits and asset markets. But Powell 0:10:48.080 --> 0:10:50.480 has said many times we do not have good choices 0:10:50.600 --> 0:10:53.760 right now. So they think risks are higher to the 0:10:53.800 --> 0:10:56.000 unemployment rate, to the upside of inflation, and there are 0:10:56.040 --> 0:10:59.680 concerns about animal spirits and financial markets. So they're taking 0:10:59.679 --> 0:11:02.240 out in insurance against the labor market. They're betting that 0:11:02.320 --> 0:11:06.319 the cost of that won't materialize. But that's what markets 0:11:06.320 --> 0:11:07.680 and investors are concerned about. 0:11:07.679 --> 0:11:10.040 Mat can we finish on the FX market? But it's 0:11:10.040 --> 0:11:11.920 not a strength come back in the last five days. 0:11:12.240 --> 0:11:14.440 How does your medium term view snack out with your 0:11:14.440 --> 0:11:16.120 shield term view on the US dollar? 0:11:16.280 --> 0:11:18.880 Indeed, Yeah, so we came into this year very barished 0:11:18.880 --> 0:11:21.120 on the dollar. We held that view until last week. 0:11:21.559 --> 0:11:24.720 So given what we're seeing from the Committee at this 0:11:24.880 --> 0:11:27.920 moment in time, in the absence of a full set 0:11:27.960 --> 0:11:31.600 of economic data, we decided to peel back on that 0:11:31.720 --> 0:11:35.440 view temporarily. It's a tactical adjustment in what we think 0:11:35.480 --> 0:11:38.840 will be a trend that extends into twenty twenty six. 0:11:39.080 --> 0:11:39.800 It doesn't have. 0:11:39.760 --> 0:11:40.720 To play out that way. 0:11:40.960 --> 0:11:42.640 One of the things that we're debating as a house 0:11:42.679 --> 0:11:47.040 today alongside my colleagues in economics is what does twenty 0:11:47.080 --> 0:11:50.080 twenty six and twenty twenty seven look like That can 0:11:50.160 --> 0:11:52.640 be a game changer for the US dollar. We're still 0:11:52.640 --> 0:11:56.400 debating that. But in the meantime, if the FED continues 0:11:56.440 --> 0:11:59.080 to cut rates, the dollar should have a little bit 0:11:59.120 --> 0:12:02.440 more room to move left or before possibly swinging higher 0:12:02.520 --> 0:12:03.920 in the second half of next year. 0:12:04.600 --> 0:12:08.120 Stay with us more Bloomberg Surveillance coming up after this 0:12:17.080 --> 0:12:20.319 Democratic Socialist so rum Mumdowney winning the New York City 0:12:20.360 --> 0:12:23.160 mayoral race with fifty point four percent of the vote. 0:12:23.280 --> 0:12:26.000 Catherine Wild, CEO of the Partnership for New York City, 0:12:26.040 --> 0:12:28.800 writing the following. Ultimately, the impact of the election on 0:12:28.840 --> 0:12:31.840 business will depend on the extent to which Mumcdowney appoints 0:12:31.880 --> 0:12:35.120 competent deputies and commissioners to run city agencies. 0:12:35.200 --> 0:12:37.640 Catherine joins us now for more. Catherine Gimmrnic Good. 0:12:37.440 --> 0:12:38.960 Morning, Thank you for being here with us in New 0:12:39.040 --> 0:12:40.679 York City. Let's talk about some of this. What did 0:12:40.760 --> 0:12:42.000 New York just vote for? 0:12:42.720 --> 0:12:44.880 Well, I think number one, we have to look at 0:12:44.880 --> 0:12:47.679 the fact that more voters came out to vote for 0:12:47.880 --> 0:12:51.160 mayor than we've seen in the fifty six years since 0:12:51.240 --> 0:12:53.720 nineteen sixty nine, which was my first election in New 0:12:53.800 --> 0:12:59.440 York when John Lindsay was elected on the Liberal line. Actually, 0:12:59.760 --> 0:13:04.760 so this was a big turnout, and I think it 0:13:04.920 --> 0:13:09.480 reflects the frustration of the New York City voters with 0:13:09.800 --> 0:13:12.720 a couple of things. Number one the high cost of 0:13:12.760 --> 0:13:16.840 living and doing business in New York City, and which 0:13:17.600 --> 0:13:19.400 Zoram Mamdanni. 0:13:18.920 --> 0:13:22.120 Spoke very effectively to and it. 0:13:22.080 --> 0:13:27.360 Reflects a frustration with a series of politicians who have 0:13:27.720 --> 0:13:29.720 disappointed New Yorkers. 0:13:30.120 --> 0:13:33.040 Those high marks in terms of the how many people 0:13:33.040 --> 0:13:35.480 came out to vote was fueled by support of mam 0:13:35.559 --> 0:13:37.640 Donni but also those that were against him. There's a 0:13:37.679 --> 0:13:39.600 lot in the business community, have a lot of concerns. 0:13:39.840 --> 0:13:41.839 Has he assuaged those concerns yet? 0:13:42.120 --> 0:13:45.640 I cannot say that he has asswaged those concerns completely. 0:13:46.160 --> 0:13:49.800 After the primary election, when everybody was shocked that he 0:13:49.880 --> 0:13:53.959 beat Andrew Cuomo by thirteen points in that primary in June, 0:13:54.400 --> 0:13:57.920 he reached out, actually called me right away and said, 0:13:58.440 --> 0:14:01.800 tell me which business leaders I should meet with to 0:14:01.920 --> 0:14:04.080 learn from them and to show them that I'm not 0:14:04.320 --> 0:14:05.800 going to socialize their business. 0:14:05.840 --> 0:14:07.000 What did you advise he meet with. 0:14:07.520 --> 0:14:09.720 I gave him a number of I gave him a 0:14:09.800 --> 0:14:11.959 long list of people. I mean, our co chairs of 0:14:12.040 --> 0:14:16.440 the partnership, Rob Spire and Albert Burla and Jamie Dimond, 0:14:16.440 --> 0:14:20.560 obviously Larry Fink. Leaders from across come from across the 0:14:20.560 --> 0:14:23.280 industry as well as the small business representatives, the borough 0:14:23.400 --> 0:14:27.720 Chambers of Commerce, the Restaurant Hospitality Association, so a mix. 0:14:28.200 --> 0:14:30.000 We have a lot of reporting that what business leaders 0:14:30.040 --> 0:14:32.280 wanted to see was to him to tap Jessica Tish 0:14:32.440 --> 0:14:34.680 to continue to lead the NYPD be the commissioner. 0:14:34.720 --> 0:14:37.080 There is it your understanding that she's going to stay. 0:14:37.440 --> 0:14:40.800 Well, I think she's going to stay, and I will 0:14:40.840 --> 0:14:43.600 say that that was the number one priority. It was 0:14:43.640 --> 0:14:47.840 an important signal both to the business community about the 0:14:47.880 --> 0:14:50.880 public safety. As employers, they want the city to be safe, 0:14:50.920 --> 0:14:53.320 and jesse has done a great job. They just announced 0:14:53.320 --> 0:14:56.440 this week that crime is down again this month another 0:14:56.480 --> 0:14:59.120 six and a half percent on her watch, so that 0:14:59.280 --> 0:15:01.480 was a big app And the fact that her family 0:15:01.560 --> 0:15:04.040 is iconic in the city's Jewish community. I think it 0:15:04.080 --> 0:15:09.160 was also another important piece of that. Mom Donnie did 0:15:09.920 --> 0:15:13.000 say that he would retain her. I know they have spoken, 0:15:13.680 --> 0:15:17.680 and she was not going during the campaign. She was 0:15:17.720 --> 0:15:19.680 not going to make it commitment one or the other 0:15:19.760 --> 0:15:23.280 because she doesn't think it's professional in her job as 0:15:23.320 --> 0:15:29.120 police commissioner to participate in campaigns. But I'm hopeful and 0:15:29.200 --> 0:15:32.960 optimistic that she will stay. She loves her job, she 0:15:33.000 --> 0:15:36.760 says her mission is not finished. So I'm very hopeful. 0:15:37.200 --> 0:15:38.920 You've been in the city a long time tracked its 0:15:38.920 --> 0:15:42.480 politics have been in exus between business and the political sphere, 0:15:42.520 --> 0:15:45.960 and I'm just wondering if you've seen real evidence of 0:15:46.000 --> 0:15:49.520 people leaving the city in fear of higher taxes or 0:15:49.560 --> 0:15:53.760 some sort of regime that makes it less desirable for them. 0:15:53.960 --> 0:15:55.080 Well, people are. 0:15:55.040 --> 0:15:57.640 Leaving the city because of high costs in general, and 0:15:57.760 --> 0:16:00.280 taxes are part of that. And for those who think 0:16:01.000 --> 0:16:05.240 and a big concern about our incoming mayor is that 0:16:05.320 --> 0:16:08.960 he may think that somehow spending more government money is 0:16:09.000 --> 0:16:11.960 going to make the city more affordable, when in fact 0:16:11.960 --> 0:16:16.280 it's exactly the opposite. City and state budget spending has 0:16:16.320 --> 0:16:18.800 gone up over fifty percent in the past decade, and 0:16:18.840 --> 0:16:20.240 that's driving. 0:16:19.840 --> 0:16:21.280 Our affordability crisis. 0:16:21.320 --> 0:16:25.600 So hopefully we will be successful in finding other ways 0:16:25.960 --> 0:16:28.760 to fund some of the new mayor's priorities. 0:16:28.960 --> 0:16:32.240 Is there any evidence that that's on his docket because 0:16:32.240 --> 0:16:34.880 he talked about raising taxes on the wealthiest individual as 0:16:34.880 --> 0:16:36.840 he talked about paying for it that way. Is there 0:16:36.840 --> 0:16:39.920 any sense that there is some sort of awareness of 0:16:39.960 --> 0:16:42.720 the debt and sort of the debt cycle that cities 0:16:42.720 --> 0:16:44.760 can get into that can make things less affordable. 0:16:44.880 --> 0:16:47.600 Well, New York City has a legal debt limit, and 0:16:47.720 --> 0:16:51.520 we also, since the financial crisis of the nineteen seventies, 0:16:51.760 --> 0:16:54.720 if the mayor gets too aggressive about his spending, a 0:16:54.800 --> 0:16:57.680 financial control board comes into place and the state takes 0:16:57.680 --> 0:17:00.200 over the city finances, so we don't have to worry 0:17:00.200 --> 0:17:02.080 about New York City going bankrupt again. 0:17:02.600 --> 0:17:03.920 So that's a check on that. 0:17:04.359 --> 0:17:09.040 In the conversations with him about the danger of raising 0:17:09.080 --> 0:17:11.960 taxes in terms of New York's competitiveness, I mean, right now, 0:17:12.480 --> 0:17:15.159 those of US professionals in New York are paying fifty 0:17:15.160 --> 0:17:18.080 five percent of their income in taxes to federal, state, 0:17:18.119 --> 0:17:20.600 and city government. You move to Florida or Texas, you're 0:17:20.640 --> 0:17:23.439 paying thirty eight percent. So that's a pretty big number 0:17:24.200 --> 0:17:27.160 that we have to take into consideration. So I think 0:17:27.200 --> 0:17:29.720 that he's going to become more practical as he sees 0:17:29.760 --> 0:17:30.640 the implications. 0:17:30.680 --> 0:17:32.880 He has said, I have my goals. 0:17:32.920 --> 0:17:34.360 I want to achieve them. 0:17:34.600 --> 0:17:36.959 But I'm wide open on how to do that, And 0:17:37.000 --> 0:17:39.800 that's an opening, I think for business expertise to help 0:17:39.880 --> 0:17:40.920 him figure this out well. 0:17:40.960 --> 0:17:41.520 To achieve them. 0:17:41.520 --> 0:17:44.160 He says he's going to raise taxes, but governor, Hokles says, 0:17:44.160 --> 0:17:45.919 I can't lose any more people to Palm Beach to 0:17:46.000 --> 0:17:48.840 your point, looking at the tax differentials, So can he 0:17:48.920 --> 0:17:51.560 even attempt to raise taxes without the governor on board. 0:17:52.359 --> 0:17:57.080 He cannot raise corporate or personal income taxes without well, 0:17:57.119 --> 0:17:59.960 that's not a city prorogative, that is a state prerogative. 0:18:00.320 --> 0:18:02.960 He can raise real estate taxes, but he has said 0:18:03.160 --> 0:18:06.680 as he's thought about the implications of freezing the rent, 0:18:07.000 --> 0:18:09.520 he has said he will actually do property tax reform 0:18:09.520 --> 0:18:14.200 and try and reduce taxes on rent regulated commercial buildings, 0:18:14.320 --> 0:18:18.880 multi family buildings. So I am I think that as 0:18:19.000 --> 0:18:24.040 we see who his appointments are and how he takes 0:18:24.080 --> 0:18:26.919 input on his appointments. Last night, I was very pleased 0:18:26.960 --> 0:18:30.120 that the tax word was not mentioned in his acceptance 0:18:30.119 --> 0:18:34.600 speech as mayor, so that was a good sign. And 0:18:35.160 --> 0:18:38.000 he also started out how he's going to achieve his 0:18:38.080 --> 0:18:40.280 goals is we're going to reduce the cost of government 0:18:40.280 --> 0:18:43.520 and reduce bureaucracy. So he's sounding more and more like 0:18:43.560 --> 0:18:44.240 Mike Bloomberg. 0:18:45.080 --> 0:18:48.520 Stay with us multiple IMPEG. Savannah's coming up after this. 0:18:57.480 --> 0:19:00.560 The US Supreme Court hearing garguments today challenging the galaxy 0:19:00.800 --> 0:19:03.639 of some of President Donald Trump's tariffs. If overturned, the 0:19:03.720 --> 0:19:07.080 government may face refunding billions of dollars in a blow 0:19:07.119 --> 0:19:10.240 to the nation's finances. Lisa, This in many ways is 0:19:10.280 --> 0:19:12.080 about the bond market more than anything else. 0:19:12.240 --> 0:19:14.000 If you don't get the four hundred billion dollars of 0:19:14.000 --> 0:19:16.439 annual revenues that we seem to be on track for 0:19:17.280 --> 0:19:20.720 from the tariffs, what does that mean for the deficit picture. 0:19:20.920 --> 0:19:22.920 For some of the bond vigilantes that have gone into 0:19:22.960 --> 0:19:25.439 hiding and are covering their heads, there is this feeling 0:19:25.440 --> 0:19:28.480