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Speaker 1: Member s I p C. Welcome to the Bloomberg Surveillance Podcast.
Speaker 1: I'm Tom Keene with David Gura. Daily we bring you
Speaker 1: insight from the best in economics, finance, investment, and international relations.
Speaker 1: Find Bloomberg Surveillance on iTunes, SoundCloud, Bloomberg dot Com, and
Speaker 1: of course on the Bloomberg Sally craw Chuck is with us,
Speaker 1: and she is of course an historic place on Wall
Speaker 1: Street delivering first order securities analysis for Sanford Bernstein where
Speaker 1: she broke original ground, and then her executive work in
Speaker 1: financial management and now running Elvis is on. The book
Speaker 1: is own it and it's not another touchy feely g
Speaker 1: Gali book here. This is the real thing and it's
Speaker 1: hard hitting. Let's start with diversity councils. You go right
Speaker 1: after diversity councils say no, no, no, help me here. Well,
Speaker 1: here's what I would say, Tom is and I think
Speaker 1: we've seen it in diversity has stalled gender progress. We
Speaker 1: certainly have seen it in politics, but in business as well.
Speaker 1: For all the discussion and debate about the power of diversity,
Speaker 1: it's stalled in on Wall Street. You know, it's gone
Speaker 1: backwards over the past acts going backwards. And what is
Speaker 1: your prescription to get away from the happy talk of
Speaker 1: the recent decade. Well, for CEOs, start to just do
Speaker 1: it because the impact of not doing it has been theoretical.
Speaker 1: You won't get the higher return return on equities, you
Speaker 1: won't get the greater innovation. But at some point it's
Speaker 1: going to become actual because the number one reason millennial
Speaker 1: women leave their jobs today is to make more money.
Speaker 1: Can you look at a guy like Mark Benoff who
Speaker 1: we interviewed Davos and he goes back starting with three
Speaker 1: guys in an apartment and he's, I guess made a
Speaker 1: success of himself. And Benoff says, come on, if you
Speaker 1: actually do this livid day to day, it's not that hard.
Speaker 1: What's holding up the rest of corporate America. Well, it's
Speaker 1: because they think it is that hard. It is so
Speaker 1: much easier to bring in diverse individuals and treat them
Speaker 1: like middle aged white guys. Be confident, make your case,
Speaker 1: raise your hand for the P and L responsibility as
Speaker 1: supposed to really pulling out of everybody the different things
Speaker 1: they bring to work to drive the power of diversity, right,
Speaker 1: Sally do We just need more transparency. More transparency in
Speaker 1: the workforce means that you know how much everyone is paid,
Speaker 1: you know how many people are employed. And it's certainly
Speaker 1: through transparency that people can actually fight for diversity. I
Speaker 1: can want to fight for diversity, but it's very difficult
Speaker 1: for me to see where I should be fighting. For example. Well,
Speaker 1: I think that's a great point. And on today's trajectory,
Speaker 1: we are either a hundred years, fifty years, a hundred
Speaker 1: eighty years away from gender pay parity longer if you're
Speaker 1: a woman of color, so way away. But all of
Speaker 1: a sudden, they're these resources such as paste get get
Speaker 1: raised comparably hired, where we can go in and see
Speaker 1: about how much we should be paying. So back in
Speaker 1: my day, a couple of years ago, when I would
Speaker 1: go in for a raise, it was please give me
Speaker 1: a raise. Today it's this is how much I should
Speaker 1: be making, and I can see it, and so I'd
Speaker 1: like that raise. The power is shifting, right, What is
Speaker 1: the one thing, what is the one common misconception on
Speaker 1: boards on how to treat diversity and actually how to
Speaker 1: be more inclusive. Well, look, I think boards just haven't
Speaker 1: really taken the bull by the horns. I mean, everybody
Speaker 1: says this is an important to do, but when your
Speaker 1: CEO shows up and says, yeah, I know, and I
Speaker 1: would love to put Susie in that role, but Jim,
Speaker 1: Jim is such as Jim, and gosh, she reminds me
Speaker 1: so much of me. The board finds it difficult to
Speaker 1: reach into the company and question those individuals decisions despite
Speaker 1: what the research indicates. Okay, let's look here at the video.
Speaker 1: We did a research project. Sally's gagging here this morning,
Speaker 1: off the level, off the lousy savannas. Go bring up
Speaker 1: the video this weekend. And this is extraordinary. But I
Speaker 1: want to tie this into own it as well. You've
Speaker 1: got four million women marching. I get it, it's a
Speaker 1: huge deal, but how many of those women took triggonometry.
Speaker 1: You go right to it on page one thirty two
Speaker 1: of your book and you say, this carnard that women
Speaker 1: can't do math is just belogning. And what people don't know, folks,
Speaker 1: is Crawchuck invented this on Wall Street with your work
Speaker 1: at Sanford Bernstein, are you seeing more women say screw
Speaker 1: the stereotype. I'm doing trigg Well I did. I didn't
Speaker 1: invent trigonometry, though I do appreciate the compliment. But here's
Speaker 1: what I would say. We're now starting to talk about
Speaker 1: the gender money gaps and women. There are several gender
Speaker 1: money gaps we have which cost us millions over the
Speaker 1: course of our lives. Women can go to the elivest
Speaker 1: website and they can see we put together a whole
Speaker 1: guide book on this. The one I'm very focused on
Speaker 1: with eLabs is a gender investing gap which costs women
Speaker 1: hundreds of thousands or millions, and we still buy the
Speaker 1: Ozzie and Harriet math is for guys. Guys are better
Speaker 1: investors than women. That is, neither of those things are true.
Speaker 1: I'm trying to think of the percentage of our audience
Speaker 1: that don't know who Azzi Harried is. They don't even
Speaker 1: know that Rick Nelson went to a garden party and
Speaker 1: Harriet it's way back Gillian's Island family. How do we
Speaker 1: get away from the stereotype of Ginger and Tina whatever
Speaker 1: her name was, Well, why not? We need to actively
Speaker 1: move away but this is the place the stereotypes there,
Speaker 1: here's one that drives me nuts. Women need more financial
Speaker 1: education to invest, and we women, because we love getting
Speaker 1: our eyes are like, you're right, I need more financial education,
Speaker 1: except the guys need more to but we invest anyway,
Speaker 1: they invest anyway. So here's the here's the final point
Speaker 1: industry symbol, a bull. Not a lot of women are
Speaker 1: looking at that and saying that's for me. So in
Speaker 1: Sally project now she joins us here in the studio.
Speaker 1: She's the author of a new book, own It, The
Speaker 1: Power of Women at Work, of course, former CEO of
Speaker 1: Smith Barney, now the c and co founder of Elvis.
Speaker 1: Great to have you with us. Let's start at the
Speaker 1: beginning of your book. A great first line here, Well
Speaker 1: here we are you right, but the view looks a
Speaker 1: little different than we expected. Were There a lot of
Speaker 1: revisions here between between the events of November the eighth
Speaker 1: and where we are today. Remarkably few, actually, because diversity
Speaker 1: has stalled in corporate America and for those of your
Speaker 1: listeners on Wall Street has gone backwards on Wall Street
Speaker 1: before the shocking too many election results. So yes, three
Speaker 1: days after the election, I did wake up and call
Speaker 1: my public say, oh my gosh, well, you know, let's
Speaker 1: can I change the first couple of lines, but remarkably
Speaker 1: little because the stalling. There was a piece in Bloomberg
Speaker 1: Business Week about all that Hillary Clinton promised to do
Speaker 1: if she were to be elected for women who work
Speaker 1: in government, particularly at the mid level, and there was
Speaker 1: great despair in Washington that that was going to change
Speaker 1: with the with the President Trump. Your background is in
Speaker 1: Wall Street, not in government. But there are ramifications from
Speaker 1: from the way the election turned out for women in business.
Speaker 1: Absolutely there are Um you know, I was personally hoping
Speaker 1: for mandated parental leave. We're the only developed country in
Speaker 1: the world that doesn't have it, and there's new research
Speaker 1: that shows it pays for itself in the first year
Speaker 1: because women are more likely to come back if they
Speaker 1: have maternal leave and you don't have to replace them
Speaker 1: and train their replacement regardless. One of the points of
Speaker 1: the book before the election is, hey, guys, you know,
Speaker 1: what we've been doing has gotten us so far, but
Speaker 1: no farther. So what are what's going to happen now?
Speaker 1: And the points on the book is, first of all,
Speaker 1: you know, there's so much freaking advice out there that
Speaker 1: tells us to act like men, when in fact, we
Speaker 1: bring so many great qualities to the workforce that are
Speaker 1: becoming more important, such as risk awareness, such as relationship orientation,
Speaker 1: such as long term perspective. I mean, things that are
Speaker 1: important and are becoming more important and drive great results
Speaker 1: in business. The issue is four. If there wasn't a
Speaker 1: lot we could do about it, if company didn't appreciate it,
Speaker 1: we could go work at another company. Now we have
Speaker 1: much more information, we can figure out we can go
Speaker 1: to websites to figure out our gender pay gap, and
Speaker 1: we can go started on fraggan businesses. All of a sudden,
Speaker 1: you know, the technology is changing things in a way.
Speaker 1: We have so much more power. I'm so interesting that
Speaker 1: you read about that in the book, that the role
Speaker 1: of technology is playing here. Explain that a little bit more,
Speaker 1: that the doors that changing technology is opening for women
Speaker 1: in business. And it's not perfect, right. Venture capitalists don't
Speaker 1: get it, But you know what do we get like
Speaker 1: three or six or seven percent of venture capital dollars.
Speaker 1: But most businesses are not venture capital funded. And today
Speaker 1: the cost of technology is coming down. You don't have
Speaker 1: to buy servers, you you rent space in the cloud.
Speaker 1: But it's not just technology that's taking down the cost
Speaker 1: of starting businesses. It's we works as opposed to long
Speaker 1: term releases. It's benefits as opposed to an HR department.
Speaker 1: You know, it's it's video conference as opposed to business travel.
Speaker 1: That you're able now to start businesses to a degree
Speaker 1: you couldn't before. And there's so many more role models.
Speaker 1: I go through a hunking list of them there of
Speaker 1: women who were starting their own businesses and in part,
Speaker 1: in part, actually, the number one reason women get for
Speaker 1: starting their own businesses is because they want to build
Speaker 1: the business at which they want to work, and corporate
Speaker 1: America isn't working for so many of them. So for
Speaker 1: big companies that don't get it, there wasn't much penalty before,
Speaker 1: I believe going forward as women recognize that these places
Speaker 1: can be hollowed out. Talking with Sally Crotchick, the author
Speaker 1: of Own It, The Power of Women at Work, picking
Speaker 1: up on what you were just saying, how has mentorship
Speaker 1: changed The notion of mentorship changed here since you've got
Speaker 1: into the business. Well, mentorship it's it's very nice, it's
Speaker 1: very good stuff. It's Hey, I have a question for you, Hey,
Speaker 1: I've an answer for you. Women have and I'm gonna
Speaker 1: get these numbers wrong, but three times as many mentors
Speaker 1: as men, but we have about a third as many
Speaker 1: sponsors as men. What's a sponsor? This person in the
Speaker 1: room who says promote her or promote him or I'm
Speaker 1: going to put my political capital on the line for
Speaker 1: him or her and really pull you along, And we
Speaker 1: just don't have as many of them. In fact, even
Speaker 1: we think we have more than we do, and then
Speaker 1: when we question about it, we're like, no, no, don't
Speaker 1: have them. UM, So that's an important in fact what
Speaker 1: I would say. You know, we talked about the book
Speaker 1: in a geeky way, but there's a lot of action
Speaker 1: oriented advice based on my almost thirty years in the
Speaker 1: business UM as well as a lot of Wall Street anecdotes,
Speaker 1: some of which I think, you know, you're gonna be
Speaker 1: like what happened? I can't believe it? And I figure
Speaker 1: if I can sort of give the advice on how
Speaker 1: I navigated through this most mail of businesses, it should
Speaker 1: be relevant for for other businesses as well. You write
Speaker 1: about group think on Wall Street, especially among the executive ranks,
Speaker 1: talk a bit about navigating that and how much that
Speaker 1: continues to persist today. Well, I got fired because of it. Essentially,
Speaker 1: so um Wall Street, the business I love, went into
Speaker 1: the downturn white mail and middle aged, and it came
Speaker 1: out whier mailer and middle aged her, which is really
Speaker 1: sort of surprising. And one of the points I make
Speaker 1: is that while we talk about greed as a driver
Speaker 1: the downturn, okay, leverage, absolutely, but one thing we don't
Speaker 1: talk about a group thinking. What I saw were individuals
Speaker 1: who had the same types of backgrounds, the same type
Speaker 1: of training, same training programs, all friends who fought the
Speaker 1: same way. And so as we went into the downturn,
Speaker 1: there was a it's going to be okay, remember we
Speaker 1: saw this, Oh yeah, I remember the last time we
Speaker 1: Oh remember that one felt and I'm like, what are
Speaker 1: we talking about? You're finishing each other's sentences, And so
Speaker 1: there wasn't that outside. Hey, guys, I have a vastly
Speaker 1: different background, perspective, orientation, way of approaching problems. How about this?
Speaker 1: And without more, without more of that, we drove straight
Speaker 1: over the cliff. You had this career on Wall Street,
Speaker 1: you leave to start this company. Are the regrets that
Speaker 1: you didn't do that sooner. As women are weighing whether
Speaker 1: or not to state the firms they're at or start
Speaker 1: thrown businesses, what would you say about timing well, you know,
Speaker 1: for l Vest, which is a digital investment platform for women. UM,
Speaker 1: I'm not sure I could have started any sooner because
Speaker 1: the technology had to catch up with the idea. I mean,
Speaker 1: we're providing a to my mind, really sophisticated offering for women.
Speaker 1: It's true goals based investing. It's not about beating the
Speaker 1: market when the euro this versus the end, but investing
Speaker 1: highly customized investment portfolios to reach your goals by house,
Speaker 1: have a baby, start a business, retire well. Um. And
Speaker 1: the technology UM had to come pretty far for for
Speaker 1: it to be feasible for us to build the business.
Speaker 1: So do I wish I'd skipped a few chapters. Oh yeah,
Speaker 1: oh yeah, you know that that getting re orged out
Speaker 1: of Bank of America. I could have actually had a
Speaker 1: dream last week, Brian Mornahan wants to see you. I'm like,
Speaker 1: not again. I'm gonna get re orged out again, even
Speaker 1: though my results are better than you know, even though
Speaker 1: we're beating Black No, and in my dream, I thought,
Speaker 1: if I just escaped from the office, maybe they won't
Speaker 1: find me. Yeah, But then I woke up. You equival
Speaker 1: with you take issue with the term empowerment? What is
Speaker 1: it about that, that word that you don't like? I've
Speaker 1: always hated it, and I thought it was because it
Speaker 1: was trite, and you know, let me. I've always hated
Speaker 1: it because I thought it was overused. Um. I then
Speaker 1: finally finally looked it up in the dictionary and empowerment
Speaker 1: means to be given power. Wait a minute, we women
Speaker 1: have got loads of power. We control five trillion dollars
Speaker 1: of investable assets we jointly control with our partners another
Speaker 1: six we direct of consumer spending. We're more than half
Speaker 1: the workforce. That's power. We haven't had the means to
Speaker 1: use it before. How would you know which company to
Speaker 1: buy from? Well, all of a sudden, their startups that
Speaker 1: will tell you, you know, when you go to the
Speaker 1: grocery store, buy up index will tell you the gender
Speaker 1: makeup the senior leadership team of the company you're buying from.
Speaker 1: So all of us or you know we've done good,
Speaker 1: will tell you about how companies are treating the environment.
Speaker 1: So all of a sudden, we have, whether it's who
Speaker 1: we buy from, who we invest in, asking for the raise.
Speaker 1: Never knew how much to ask for before, but they're
Speaker 1: all these sites that tell you how much money should
Speaker 1: be making now, um pay scale, get raised, etcetera. So
Speaker 1: we have this power and now we're beginning to have
Speaker 1: the means to use it. So I think it's changing,
Speaker 1: and I think it can change pretty rapidly. And I
Speaker 1: think the timing is so fascinating. As we have women
Speaker 1: take to the streets in Washington and New York and
Speaker 1: all over the world. What we're hearing from women again
Speaker 1: and again is I want to take some action. What
Speaker 1: we were doing before stalled out. We need to do
Speaker 1: something different. Sally, thank you very much for coming into
Speaker 1: short a time to hope we can have you back again,
Speaker 1: maybe during March madness. I don't know more fervent U
Speaker 1: n c A fan than I here we have feltorio
Speaker 1: any day Sally Project series this year. She's the CEO
Speaker 1: and co founder LS, the author of Owned The Power
Speaker 1: of Women. Edward David Garraty and New York Tom Keene
Speaker 1: is off today. Kevin Logan joins US now. He's the
Speaker 1: chief US Economists at HS at BC. Like many of us,
Speaker 1: he lent an ear to what the president, like the
Speaker 1: then president elect, had to say on Friday. And let's
Speaker 1: start there, Kevin. We focus with an arcual address on
Speaker 1: the sweeping rhetoric. It was sixteen minutes worth of that.
Speaker 1: Did you expect much granular detail to be sprinkled over?
Speaker 1: What did you hear when the president spoke, especially when
Speaker 1: it came to trade. Well, he he had two main themes,
Speaker 1: populism and protectionism. He talked about the people. He was
Speaker 1: anti establishment. He says, there's a new sheriff in town.
Speaker 1: Things are going to change. We're not going to do
Speaker 1: things the way they were done before, and particularly on trade.
Speaker 1: Previous administrations had been focused on multilateral deals, the rule
Speaker 1: of law. Everyone abide him by the same agreement. And
Speaker 1: Mr Trump has a completely different approach. He's going to
Speaker 1: approach things on a unilateral basis, one on one trade
Speaker 1: deals and as he put it, America first, not a
Speaker 1: multilateral deal in which many countries benefit and there's even take,
Speaker 1: but rather now things that clearly benefit in his view, UH,
Speaker 1: deals that will benefit the United States. So that is
Speaker 1: a complete break with the past, and it's a new direction.
Speaker 1: What's your sense of the the effectiveness of the meetings
Speaker 1: he has been holding at the White House thus far.
Speaker 1: He's going to meet with auto executives this morning. Yesterday
Speaker 1: he met with UH leaders of industrial companies, among others.
Speaker 1: Elon Musk was there from Tesla and Solar City. UM.
Speaker 1: How effective can a meeting like that be when he
Speaker 1: tries to pursue this this new kind of trade policy,
Speaker 1: I suppose well. I think image is very very important
Speaker 1: for Trump, and it's very important for any administration. When
Speaker 1: it first comes in. Everyone understands the auto industry. Everyone
Speaker 1: knows that a lot of jobs have moved to Mexico,
Speaker 1: for example, where a lot of parts are manufactured and
Speaker 1: then ship back to the United States. And so going
Speaker 1: straight to the automobile industry has a great optical appeal
Speaker 1: to people throughout the country. And he may get some victories,
Speaker 1: their small victories, some more production in the US, and
Speaker 1: it might involve a few thousand jobs. More importantly, I think,
Speaker 1: is what is the grand plan? What is the big
Speaker 1: plan that's going to change incentives for US manufacturers or
Speaker 1: any company UH to produce more in the United States
Speaker 1: and to reverse the outflow of UH production. That's been
Speaker 1: going on for several decades. The U S tax system
Speaker 1: UH basically encourages UH firms to move production out of
Speaker 1: the US. Not that it's just the U. S tax system,
Speaker 1: it's also the tax system compared with other countries. If
Speaker 1: other countries have value added tax system v a T
Speaker 1: system that taxes consumption but not so much production, whereas
Speaker 1: the US has a system of taxes production and not consumption, well,
Speaker 1: of course production is going to move where is more
Speaker 1: likely taxed, and that's been going on for some time.
Speaker 1: The question now is what will the Trump administration do
Speaker 1: to provide new incentives for corporations to locate their production
Speaker 1: in the US rather than in other countries. That's what
Speaker 1: we'll be watching for in coming months. There was a
Speaker 1: moment of the press briefing yesterday Sean Spicer was talking
Speaker 1: with reporters. One asked about the unemployment rate. She said,
Speaker 1: what is the unemployment rate? And there was some hemming
Speaker 1: and hawing about what he in the administration things it
Speaker 1: is UH, and a line after that stood out to me.
Speaker 1: He said that we've been focusing too much on statistics
Speaker 1: and I want to just draw that more broadly to
Speaker 1: talk about trade. You have the President signing an executive
Speaker 1: order yesterday rejecting the TPP, the Transpacific Partnership. By all reports,
Speaker 1: he's going to do the same thing with NAFTA. He's
Speaker 1: going to call for a rewrite of that later in
Speaker 1: the week. Are you convinced that there is enough attention
Speaker 1: being paid to the economic case for for reevaluating these
Speaker 1: trade deals or is this uh, you know, sort of
Speaker 1: statistics be damned. We're looking at at policy exclusive of that. Well, yes,
Speaker 1: it's not only statistics be damned, but conventional economic theory down. Uh.
Speaker 1: Most trade theorist would say they are great benefits from trade.
Speaker 1: Look at all the inexpensive goods that are important into
Speaker 1: the United States. Its benefits everyone, It increases people's standard
Speaker 1: of living. But that's not what the Trump administration is about.
Speaker 1: So those general gains are dwarfed in their minds by
Speaker 1: low losses that have occurred for people who are in
Speaker 1: those sectors which a lost employment, lost production because of trade,
Speaker 1: and that's what they want to reverse. So the overall
Speaker 1: theory of their overall statistics, Yes, those statistics and theories
Speaker 1: can be damned. Because the people who supported Donald Trump
Speaker 1: to a large degree see themselves as being disadvantaged in
Speaker 1: the by conventional trade theory, and that there should be
Speaker 1: a reversal of that. So that's why we're headed in
Speaker 1: this new direction. Let me ask you lastly here about
Speaker 1: a different topic entirely. Steven Manuch in the pick T B.
Speaker 1: Treasury Secretary, was testified Capital Hill, and he talked about
Speaker 1: the strength of the dollar. The president tweeted about the
Speaker 1: strength of the dollar, saying he hoped it would be weaker.
Speaker 1: This is unprecedented to have a president doing that. Are
Speaker 1: we seeing the end of the strong dollar policy? Was
Speaker 1: that was that the pivot was at the turn there
Speaker 1: When that tweet came out, it certainly sounded as if
Speaker 1: it was a pivot and change. Back in the nineties
Speaker 1: when Bill Clinton was president, the strong dollar policy was
Speaker 1: adopted because there was concerned about capital flows into the
Speaker 1: United States. Interest rates were higher. There was a concerned
Speaker 1: that foreign investors were discouraged by the progress of the
Speaker 1: American economy and if the capital wasn't invested in the US,
Speaker 1: interest rates would remain high. It would be difficult for
Speaker 1: uh the U S economy to grow. Adopting a strong
Speaker 1: dollar policy sort of put a safety net underneath the
Speaker 1: value of uh U S assets for foreign investors. By
Speaker 1: the time we got to the end of that decade,
Speaker 1: the economy was strong, the U S deficit was shrinking,
Speaker 1: moved into a surplus. The rationale for a strong dollar
Speaker 1: policy had gone, but the policy had its own inertia
Speaker 1: and just continued not anymore. I think that's new era
Speaker 1: and a new approach to the dollars that we're about
Speaker 1: to see. Kevin Love and always right to speaking in
Speaker 1: the chief us Ecnoms of HSBC, join us here in
Speaker 1: New York. This is Bloomberg Surveillance on Bloomberg Radio, brought
Speaker 1: you by Bank of America, Maryland and dedicated to bringing
Speaker 1: our clients insights and solutions to meet the challenges of
Speaker 1: a transforming world. That's the power of global connections. Marylynch,
Speaker 1: Pierce federin Smith Incorporated, Member s I PC, David Gura
Speaker 1: in New York. Tom Keene off Today's Scarlett Food joining
Speaker 1: me in the studio Brunnan Hawk and he's an analyst
Speaker 1: with UBS. We're here at the end of earning season,
Speaker 1: of the fourth quarter earning season for the big banks,
Speaker 1: the Big six banks. Brennan Hawkin, Great to have you
Speaker 1: with us, and let's start, if we could, with this
Speaker 1: prospect for regulatory change. We heard from Steve mcnut in
Speaker 1: last week on Capitol Hill test to protestifying before the
Speaker 1: Senate Finance Comming to He was asked about what could
Speaker 1: change when it comes to regulation. How do you how
Speaker 1: don analysts like you begin to process what that could
Speaker 1: mean for banks bottom lines changes to the regulatory framework. Yeah,
Speaker 1: hi David, thanks for having me on. UM. The great
Speaker 1: question and probably the one that's most difficult to try
Speaker 1: to figure out. Uh. It's something we've been wrestling with
Speaker 1: ever since early November, right, Uh and UM. Of course
Speaker 1: regulatory change is one factor. There's also the potential for
Speaker 1: for tax reform uh and everything like that. But I'll
Speaker 1: stick to the spirit of your question. UM and UM,
Speaker 1: you know, the regulatory adjustments and how to think about it.
Speaker 1: We have done some analysis looking at Goldman as an example,
Speaker 1: because really they're probably the most likely to benefit and
Speaker 1: we can we can get into why if you like. UM.
Speaker 1: We took a look at what happened in in two
Speaker 1: thousand and nine, UM, which was the last time we
Speaker 1: had a nice solid growth of the fix revenue pool,
Speaker 1: which is fixed income, currency and commodity trading amongst the
Speaker 1: large bullish bracket investment banks, and Goldman took a ton
Speaker 1: of share. Uh. They captured about of that revenue opportunity. UM,
Speaker 1: there are a great franchise. They were able to be
Speaker 1: committed to UM putting capital at work in the market,
Speaker 1: and they hadn't fired rebody off of their trading desks
Speaker 1: the way so many of their competitors had, which is
Speaker 1: remarkably similar to today UM, when other firms have restructured
Speaker 1: their thick business. It's it's been a really problematic line
Speaker 1: of business for a lot of the bullish brackets UM,
Speaker 1: but Goldman has stuck to it, and so we think
Speaker 1: that they are in a very very good position to
Speaker 1: benefit from thick expansion. If we just get back to uh,
Speaker 1: you know the average for FICK, you know, we'd be
Speaker 1: adding about fifteen billion to the global revenue pool. Is
Speaker 1: this a case of Golden stealing share from his competitors
Speaker 1: or is it growing? Is the market growing or starting
Speaker 1: to grow again? So a little bit of both, probably Scarlett. UM.
Speaker 1: What I would say is, Um, the Goldman has seeded
Speaker 1: or have had market share stolen in your Partlan's Um
Speaker 1: over the last three years in fick Um and that's
Speaker 1: mostly because the macro businesses f X rates are not
Speaker 1: really big strong as strong markets for Goldman as the
Speaker 1: commercial banks. Commercial banks have huge stock piles of treasuries,
Speaker 1: they deal in in currencies, uh, you know, gold Boy
Speaker 1: through a banking footprint, and so they have competitive advantages
Speaker 1: over a firm like Goldman Um and so they're Goldman
Speaker 1: through its business bix alone is going to appear to
Speaker 1: seed share in a time when macro businesses do much
Speaker 1: better within sick Garlett Food and I talking with Brennan Hawk,
Speaker 1: an analyst with UBS, just on the subject of Goldman
Speaker 1: quickly if I could hear Brennan, we see so many
Speaker 1: alumni of Goldman Sacks going into government here Goldman Sacks
Speaker 1: once again being foisted into the spotlight as a result
Speaker 1: of that. Is that something that's worrying to you as
Speaker 1: an analyst. Does that bring new scrutiny to the bank,
Speaker 1: maybe not new scrutiny, but renewed scrutiny to the bank,
Speaker 1: And is that something that could affect how the bank
Speaker 1: performs It certainly will bring a tension from the press.
Speaker 1: I think that that's to be expected. Um, I'm not
Speaker 1: so sure. I usually don't think that that has a
Speaker 1: big impact. Normally, when someone goes into uh, you know,
Speaker 1: public service after they've um, you know, done what they
Speaker 1: want to do and made a good deal of wealth
Speaker 1: in private sector, they usually do it because they feel
Speaker 1: like they can have an impact. Now, what I think
Speaker 1: is important and interesting is that, but you know, folks
Speaker 1: like Gary Cohen and the like who go into um
Speaker 1: Minuchan who you referenced before, David, They when they go
Speaker 1: into public service, they tend to be more um understanding
Speaker 1: of commercial interests, pro market understanding the benefits that market
Speaker 1: can bring, whereas some of the previous folks in regulatory
Speaker 1: and senior Washington positions, you know, folks like Dance while
Speaker 1: he currently still is but we'll see how for how
Speaker 1: long that Dance Rulo who comes out of academia and law.
Speaker 1: They just have a different print approach, an understanding of um,
Speaker 1: you know, the need to generate sufficient returns in the market,
Speaker 1: the benefit that markets can provide to companies and allowing
Speaker 1: for access to capital, the importance of aquidity. And so
Speaker 1: to me, this is really we stumbled onto a key point.
Speaker 1: And and you know maybe if Tom were here, I'd
Speaker 1: get a rip up the script comments or something out
Speaker 1: of him. Right, but uh, you know, to me, this
Speaker 1: is where the rubber will hit the road, and we
Speaker 1: can actually see regulatory tone change, right the idea that
Speaker 1: you know, those on top are saying, listen, we we
Speaker 1: need to have better functioning capital markets. We need to
Speaker 1: have greater liquidity in some of these bond markets and
Speaker 1: the like. And the best way to do it is
Speaker 1: to not, you know, continue to apply pressure to these
Speaker 1: businesses when they're really just trying to service customers. So
Speaker 1: that being the case, what would Gary Cohne do as
Speaker 1: his first initiative or what would he be pushing for
Speaker 1: in his first initiative? The supporting president? Yeah, and and
Speaker 1: we we we started on Gary, but but I I strayed,
Speaker 1: of course, more more broadly than that, UM, I think
Speaker 1: UM Gary is in a position where he would be
Speaker 1: advising right on the Economic Council, which is more of
Speaker 1: UM a tonal impact, right, UH, an adjustment to approach
Speaker 1: perhaps if he can put input into UM assignments, UH
Speaker 1: in key regulatory positions. To me, the key regulatory positions
Speaker 1: are what are really important here. And so we took
Speaker 1: I mentioned before about the TRUA role within the fed UM.
Speaker 1: There is also the idea we're going to have a
Speaker 1: new sec UH chairperson uh J Clayton here soon who
Speaker 1: clearly has h an understanding and appreciation for commercial interests
Speaker 1: in the markets. We've also got UM the potential for
Speaker 1: a new head of cftc UM, which is going to
Speaker 1: have a very very big impact on some of these
Speaker 1: trading markets. Volker has had a huge impact on the
Speaker 1: thick markets, mostly UM, because there's so much scrutiny of
Speaker 1: any kind of principal transaction and the need to be
Speaker 1: so cautious and so concerned about these entities trading on
Speaker 1: their own account, whereas in reality they might just be facilitating,
Speaker 1: you know, customer trade. So is it a matter of
Speaker 1: perhaps not enforcing everything that's in the vocal rule and
Speaker 1: everything that's in regulation right now as opposed to rewriting
Speaker 1: it completely to me UM, the idea that we would
Speaker 1: have repeal um of laws actually on the books is
Speaker 1: a lot more difficult. UM. Bulker is an extremely subjective rule,
Speaker 1: and if you have a regulatory approach that is hostile
Speaker 1: in its tone, then you're there's going to be an
Speaker 1: enthusiasm and a UM an approach that will limit the
Speaker 1: ability of a lot of these firms to provide liquidity
Speaker 1: the market, whereas if the approach is more pro market,
Speaker 1: more more commercially oriented, UM, than we could easily see
Speaker 1: a greater amount of liquidity provided. But in the time
Speaker 1: that we have left, let me bring it back to
Speaker 1: to the last earning season. UH. It was a fourth
Speaker 1: quarter earning season. We saw a beat like we don't
Speaker 1: usually see in the fourth quarter. Speak to the uniqueness
Speaker 1: of of of what we saw there. We've mentioned that
Speaker 1: it was a fixed story for a lot of these
Speaker 1: big banks. Are there signs that's going to continue into
Speaker 1: the next quarter or was this something really uniquely tied
Speaker 1: to the president's victory? UM, So it was a probably
Speaker 1: a mix of both. UM. There was the victory was
Speaker 1: definitely very helpful in UM providing a catalyst for markets
Speaker 1: and providing volumes. We saw a similar thing when bregsit occurred,
Speaker 1: you know in the third quarter. UH, there was a
Speaker 1: benefit Actually there's some degree to the second but also
Speaker 1: to the third quarter from that event. UM. The election
Speaker 1: also provided a great deal of reason to UH for
Speaker 1: customers to trade in the fourth quarter. Fourth quarters normally
Speaker 1: are not all that great because of the holidays and
Speaker 1: the and the lower amount of trading volume into total.
Speaker 1: One queue is typically where a great deal of money
Speaker 1: is made, especially in fix. We're off to a very
Speaker 1: very good start. There's been a very busy underwriting calendar
Speaker 1: for a lot of these debt markets, which tends to
Speaker 1: bode very very well for thick revenues. Comps are quite easy,
Speaker 1: so I think we're going to see another really strong
Speaker 1: revenue growth quarter here this quarter. And that's even before
Speaker 1: a lot of these adjustments to the regulatory enforcement that
Speaker 1: I've made reference to before to start to actually have
Speaker 1: an impact. So to me, we're just getting started, all right, friend,
Speaker 1: we'll have to have you back after some of those
Speaker 1: adjustments starts to happen. Brennon Hawk in the analyst with
Speaker 1: Ubs joining us. Michael Gapan joins us now he's chief
Speaker 1: US economist by at Barclays. Join us here in the studio.
Speaker 1: Let me start with a definitional question. Sure, there was
Speaker 1: a lot of talk about tariffs during the campaign and
Speaker 1: the transition. Now the talk seems to have shifted to
Speaker 1: conversation about the border adjustment tax. Right, are they the
Speaker 1: same thing. What what do you what do you make
Speaker 1: of the rhetoric we've heard about that here? The way
Speaker 1: the President speaks about it, it is a tariff. So
Speaker 1: he says, if if you're a company and you relocate
Speaker 1: overseas and you try and export back into the US,
Speaker 1: you will face a thirty tax. Right, that's the simplified
Speaker 1: version of what he said. That's a tariff. The way
Speaker 1: how Speaker Ryan and some of the Senate plans talk
Speaker 1: about the border adjustment tax is it's couched in broad
Speaker 1: based corporate tax reform, so it's a tax on all imports,
Speaker 1: and it's a reorientation of the tax code. So right now,
Speaker 1: it's a point of origin system, so if you're a
Speaker 1: US corporation, doesn't matter where the sale takes place, it's
Speaker 1: subject to federal taxes. So if you export that sell
Speaker 1: it abroad, your subject to federal taxes in the US.
Speaker 1: You pay it when it's repatriated. That's why we have
Speaker 1: the repatriation issue. But if you reorient the system in
Speaker 1: tax all imports, you're refundamentally reshaping the full core pro
Speaker 1: tax code. So I would say it depends on which
Speaker 1: border tax you're you're talking about if it's House Ryan,
Speaker 1: House Speaker Ryan's plan, it's comprehensive, couched and comprehensive tax reform.
Speaker 1: It's part of a very broad based fiscal stimulus plan.
Speaker 1: If you're looking out at the way President Trump is
Speaker 1: talking about it, it's more bilateral tariffs against specific trading partners.
Speaker 1: Is everyone trying to simplify this a little bit too much?
Speaker 1: I mean, should there be the same tax, whether it's
Speaker 1: border tax or a tariff on all industry, all types
Speaker 1: of companies. But I think that there's probably a legal
Speaker 1: issue on whether you can put this tax on an
Speaker 1: individual firm, right, So I think if you know, he's
Speaker 1: called out specific company correct. So I'm not a legal
Speaker 1: scholar on this, but my my guess is where it
Speaker 1: would go as you'd have to consider then tariffs on
Speaker 1: a specific industry or an entire country. Um. So if
Speaker 1: you go back to say, when um, when Reagan was
Speaker 1: in was in office, we put a tariff on semiconductors.
Speaker 1: You look at what President Obama did on steel imports
Speaker 1: from from China. So I think you would have to
Speaker 1: lead treat an entire segment and industry segment the same way.
Speaker 1: Does that work? Better. Uh, not necessarily. I think it
Speaker 1: depends on what what the goal is ultimately, and in
Speaker 1: this case, what the President is trying to do is
Speaker 1: reorient activity to the domestic economy. And in principle, if
Speaker 1: you want to get less of something, in this case trade,
Speaker 1: you have to make it more expensive or prohibited. So
Speaker 1: I think what what the President would be saying is
Speaker 1: there are specific bilateral trading partners that are not behaving well,
Speaker 1: and we could perhaps remedy that that through tariff policy.
Speaker 1: The House and Senate plans are more about we don't
Speaker 1: like the way the corporate tax code is set up.
Speaker 1: We think it creates too many distortions. UM, we'd like
Speaker 1: to lower the rate, broaden the base, and in the
Speaker 1: border adjustment tax provides a way to do that. So
Speaker 1: one's about trade policy, the other one is about corporate taxation.
Speaker 1: Make it more expensive. We're prohibited, you say, And I
Speaker 1: wonder if you if you've modeled that out sort of
Speaker 1: what that means, and if you think that the politicians
Speaker 1: who are proposing these changes have reck with that as well,
Speaker 1: what it could mean for the U. S economy. Well,
Speaker 1: I think that so in the political political economy sense,
Speaker 1: you I think you asked the question, did we just
Speaker 1: vote as as a country to say we're comfortable with
Speaker 1: paying a little more to get a little less if
Speaker 1: that means we get to keep more jobs at home.
Speaker 1: That's the kind of the anti globalization trade off. So
Speaker 1: if you put tariffs on on products, you will get
Speaker 1: less trade, that's true, but it will also mean what
Speaker 1: you and I buy every day is generally a little
Speaker 1: more expensive, so your dollar won't go as far. That's
Speaker 1: a political economy trade off. We're in the short run.
Speaker 1: It would likely hurt activity a bit and cause a
Speaker 1: little more inflation, So you have to trade a short
Speaker 1: term loss for an unknown medium term gain. Normally that's
Speaker 1: not a good political trade off, but that's what we're
Speaker 1: looking at. We're on chartered territory at the same time.
Speaker 1: That's right. We don't have a tremendous amount of experience
Speaker 1: with the imposition of very large tariffs. Um, you have
Speaker 1: to go back many decades to do that. Generally, it's
Speaker 1: not positive for activity in the short run. Yeah. I
Speaker 1: heard Stephen Moore interviewed this morning of the Heritage Foundation,
Speaker 1: former advisor to Donald Trump when he was running for president,
Speaker 1: and one thing he acknowledged. Is you have the president
Speaker 1: calling out, as Scarlett said, some of these companies by name. Uh,
Speaker 1: this could all fall apart, The strategy could all fall
Speaker 1: apart if one of them decided it makes more sense
Speaker 1: to move overseas despite the fact that these terrorists are
Speaker 1: in place. Do you agree with that that this is
Speaker 1: a sort of a a loosely constructed house. Well, that's
Speaker 1: when I would say push comes to shove and you
Speaker 1: have to decide what you what you want to do.
Speaker 1: In in our baseline, we do assume protectionist policies are
Speaker 1: put into place. We felt like the main theme of
Speaker 1: the Trump campaign was reorienting activity domestically, backing away from
Speaker 1: globalized economy. So I do think you will get protectionist policy.
Speaker 1: So yes, right now the messages don't do it. But
Speaker 1: if somebody does it, then you've drawn a line, the
Speaker 1: so called redline. And what what does the administration do
Speaker 1: in response? And we think you will get some terroffs.
Speaker 1: So what is the argument or the best argument the
Speaker 1: heads of GM Ford and FIAT christ Or can make
Speaker 1: when they go and speak with President Trump today when
Speaker 1: it comes to how best to preserve their growth prospects,
Speaker 1: but also protect US jobs. The auto market is a
Speaker 1: global market. Are Detroit makes autos that they ship into
Speaker 1: China as well, So growth for these companies is largely
Speaker 1: outside the US. They also make products for sale here.
Speaker 1: They have a global factory production process. Some of it
Speaker 1: they source and produce domestically, some of it they source
Speaker 1: and produce globally. They've allocated their capital in a way
Speaker 1: that maximizes their efficiency under the current system. If you
Speaker 1: change all that around, there's going to be a lot
Speaker 1: of upheaval. Ask you how this factors into your GDP
Speaker 1: forecast right now when you look at how the country
Speaker 1: might the country's economy might grow, I imagine the trade
Speaker 1: is still looming large is a variable that you really
Speaker 1: don't have a handle on. Yeah, that of us have
Speaker 1: a handle on on yet that's how how are you calculating?
Speaker 1: What we're assuming is is that you get say seven
Speaker 1: percent tariffs on imports from Mexico and on imports from China.
Speaker 1: That covers about a third of all imports. So if
Speaker 1: if that's correct, it would tend to reduce your growth
Speaker 1: rate by about a half percent, and it would tend
Speaker 1: to boost rates of inflation, say two to three tents,
Speaker 1: so it wouldn't be a major drag, but it would
Speaker 1: also depend on what these countries do in response, and
Speaker 1: it would depend on what other trading partners do, And
Speaker 1: it's important to consider do you get complementary fiscal stimulus
Speaker 1: alongside that. So this is why I think you need
Speaker 1: if if if I'm a say, a political operative, and
Speaker 1: I want to do anti trade policies, I better do
Speaker 1: those expansionary fiscal policies at the same time or close
Speaker 1: to the same time, so the one would outweigh the other.
Speaker 1: So if it's say modest anti trade, it's something that
Speaker 1: I think a fiscal stimulus bill could over outweigh and
Speaker 1: keep the economy on say a two to two and
Speaker 1: a half percent growth path, and everything looks fine. If
Speaker 1: it's if it's import tariffs on all imports and our
Speaker 1: trading partners do the same, it's a very different story.
Speaker 1: So I think it does depend on the reach of
Speaker 1: those anti trade policies and whether you get expansion or
Speaker 1: fiscal policy alongside. So as we await details of the
Speaker 1: new administration's trade policy, and as they sort out how
Speaker 1: they're going to approach infrastructure spending and other parts of
Speaker 1: their fiscal stimulus. What kind of cost does that uncertainty
Speaker 1: have on business activity? I think historically it would say
Speaker 1: that investment waits, and we're going to get the advanced
Speaker 1: estimate of Q four GDP on on Friday, and I
Speaker 1: would expect within that business spending will be quite soft.
Speaker 1: That whether it's spending on equipment and software or intellectual
Speaker 1: property or structure as we expect those rates of growth
Speaker 1: to be quite modest. So until you know the details,
Speaker 1: the answer is typically you wait. So at least, let's say,
Speaker 1: through the first half of the year, we would be
Speaker 1: very surprised if businesses front run any policy decision or
Speaker 1: consumers front run any any tax cut. I think until
Speaker 1: you know the details were in a holding pattern. Let
Speaker 1: me ask you about a moment in the press conference
Speaker 1: yesterday with Spice to the White House press sectory question
Speaker 1: was what's the unemployment rate? Is this going to be
Speaker 1: something that's pretty hotly debated here in the new year.
Speaker 1: What what unemployment actually is? I think it's it's about
Speaker 1: facts and how you claim victory. And so if you
Speaker 1: don't settle on a definition of what unemployment is, then
Speaker 1: you can always claim that your policies are are benefiting
Speaker 1: labor markets. There's an accepted unemployment rate. That's let's call
Speaker 1: it mid to high force right now, because it's it's
Speaker 1: oscillating around for seven, for eight, for nine, but we're
Speaker 1: below five, and most of us in the economist world
Speaker 1: have settled on Yeah, that's a reasonable measure of where
Speaker 1: labor markets are, and by that measure, we're at full employment.
Speaker 1: We are here with Michael Gabon, he is the chief
Speaker 1: US economist at Barkleys and Michael, we were talking about
Speaker 1: how to define unemployment in this new administration. The thorough
Speaker 1: Reserve may have the opportunity to do just that because
Speaker 1: next week we have the next f O MC meeting Wednesday. UM,
Speaker 1: people are not expecting a rate increase. It's not a
Speaker 1: live meeting. In fact, if you look at w I
Speaker 1: r P on the Bloomberg, only a chance of rate
Speaker 1: hike on February one. Yet we are likely to get
Speaker 1: some language regarding where we are in the FEDS duty
Speaker 1: to fulfill its two mandates of full employment and inflation
Speaker 1: controlling inflation. That's right. So last week when Cherry Ellen spoke,
Speaker 1: you've got a very clear message on the labor market,
Speaker 1: the unemployment rate, the U three measure is near its
Speaker 1: long term UM level, the underemployment rate has the U
Speaker 1: six measure has fully retraced. All your cyclical components of
Speaker 1: participation in the employment of population ratio have have been removed,
Speaker 1: and it would be risky and unwise to pursue a
Speaker 1: hot economy. And she concluded, I think we're basically there
Speaker 1: on the employment side of of our dual mandate. So
Speaker 1: I think that's the message you'll see in the statement.
Speaker 1: There will be the normal discussion on the incoming data,
Speaker 1: but I think you'll you'll see that conclusion that at
Speaker 1: least as as it pertains to labor markets, under utilization
Speaker 1: has been removed, and that will be an important signal
Speaker 1: for markets because looking ahead it means further progress will
Speaker 1: generate rate hikes. It's an important signal for the markets.
Speaker 1: What kind of signal does it send to the Trump administration?
Speaker 1: That's right. So I think that the FED is has
Speaker 1: a statutory mandate, meaning Congress has given it um specific goals,
Speaker 1: and the FED interprets its maximum employment goal through a
Speaker 1: variety of measures, but the main one is the unemployment rate.
Speaker 1: So the marker there from a political point of view
Speaker 1: is that, well, we have to raise rates because we're
Speaker 1: pretty close to our dual mandate. We're a little off
Speaker 1: on inflation, but we're basically they're on unemployment. So further
Speaker 1: progress means rate hikes. So it's a signal on a
Speaker 1: political front that we're doing this because we're there, not
Speaker 1: because we don't like the policies that that are coming.
Speaker 1: But if you don't accept that unemployment rate, um, you're
Speaker 1: from the other side, you're still likely to generate some
Speaker 1: political goal criticism. We'll listen to the political argument that's
Speaker 1: taking place on Capitol Hill about a more rules based approach.
Speaker 1: The FILS should take a more rules based approach, Uh,
Speaker 1: if one were in place, how that effect defends thinking
Speaker 1: right now? Well, the rules based approach would would say
Speaker 1: if if you assume the U three unemployment rate is
Speaker 1: part of of of that rule, then yes, that rule
Speaker 1: would say you should be normalizing policy um. Yelling went
Speaker 1: through several different variations of the policy rule. All of
Speaker 1: them suggested that rates should should go higher, some faster
Speaker 1: than than others. But the critical decision would be, well,
Speaker 1: what do you assume then, is the goal for maximum
Speaker 1: employment and the inflation side is obviously easier to to
Speaker 1: pin down UM. But from a rules based approach that says,
Speaker 1: either some combination of U three and even U six
Speaker 1: were there by by those measures, and moderate increases in
Speaker 1: in front end rates are are in store. Does the
Speaker 1: f that matter as much in this environment? Uh? While,
Speaker 1: Since we talk about the FED as having an actual
Speaker 1: impact on how companies decide what to do, that's right.
Speaker 1: So I think the big shift in November was that
Speaker 1: the FEDS no longer the only game in tone and
Speaker 1: for for years our discussions have always been around what's
Speaker 1: the central bank going to going to do? And and
Speaker 1: now we're getting a little more balanced and the FED
Speaker 1: will be following. So it depends on what fiscal policy.
Speaker 1: Does you get a lot of anti anti trade, not
Speaker 1: a lot of fiscal stimulus. The FED will be ignoring
Speaker 1: that inflation impulse, looking where activity goes, and you make
Speaker 1: it easy in that world. If you get a lot
Speaker 1: of fiscal stimulus at a time when the FED sees
Speaker 1: the economy as as being at full employment, and we
Speaker 1: would agree with that, then you're going to get some offsets.
Speaker 1: So they're important in the sense that they will be
Speaker 1: pushing rates higher. The dollar will likely respond to that,
Speaker 1: so you'll get a tightening and financial conditions alongside fiscal stimulus,
Speaker 1: so there'll be some crowding out effects. Help us with
Speaker 1: the potential seismic shift here in terms of personnel on
Speaker 1: the FED Reserve. How big good deal is is that
Speaker 1: going to be? We hear the report this week that
Speaker 1: maybe a community banker might join the ranks of the
Speaker 1: FIT Reserve Board. How big a shift is this going
Speaker 1: to be? I think in the next by seen you'll
Speaker 1: probably turn over a third and a half of the
Speaker 1: entire FMC, at least from the board's point of view.
Speaker 1: It's likely the chair and the vice chair Um Daniel Tarullo,
Speaker 1: if not one or two more UM may maybe. So
Speaker 1: you got the two new faces and then perhaps three changes.
Speaker 1: So that's help us with the new faces? I mean,
Speaker 1: do you haven't do you have a sense of who
Speaker 1: this administration might put forward? Well, there's been as you mentioned,
Speaker 1: there's the name of the community bankers that were put
Speaker 1: out yesterday. I would say, we don't have a tremendous
Speaker 1: amount of information. What I would say is I would
Speaker 1: expect them to be more practitioners, actual bankers or those
Speaker 1: who have worked in markets and generated good performance. Um So,
Speaker 1: Kevin Walsh would be an example. If you reach back
Speaker 1: and look at a previous board governor from a Republican administration,
Speaker 1: little more more could practitioner oriented much less see pure
Speaker 1: academic oriented. That's kind of the shift I would expect.
Speaker 1: What it means for monetary policy, it's hard to say
Speaker 1: until we know who the chair is. All right, Michael Gaban,
Speaker 1: thank you very much as always for joining us. Michael Gaban,
Speaker 1: Chief u S Ecconomist at Barclay's joining us here in
Speaker 1: New York. Thanks for listening to the Bloomberg Surveillance podcast.
Speaker 1: Subscribe and listen to interviews on iTunes, SoundCloud, or whichever
Speaker 1: podcast platform you prefer. I'm out on Twitter at Tom Keene.
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