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Speaker 1: P and L Podcast. I'm Pim Fox. Along with my
Speaker 1: co host Lisa Abramowitz. Each day we bring you the
Speaker 1: most important, noteworthy, and useful interviews for you and your money,
Speaker 1: whether you at the grocery store or the trading floor.
Speaker 1: Find the Bloomberg P and L Podcast on iTunes, SoundCloud
Speaker 1: and at Bloomberg dot com. A rising rate environment, what's
Speaker 1: that going to do to the real estate business to homeowners?
Speaker 1: Let's find out from Mark Stefanski. He's the chief executive
Speaker 1: of Third Federal Savings and Loan. Mark, thank you very
Speaker 1: much for being with us. Just start us off by
Speaker 1: telling people a little bit about a Third Federal Savings
Speaker 1: and Loan. Okay, yeah, good morning, Thank you for having
Speaker 1: me on the show. Uh yeah, My parents started Third
Speaker 1: Federal back in n My dad frantically invented the home
Speaker 1: mortgage business, and so I'm second generation. We do business
Speaker 1: in twenty three states. Now we have stores in Ohio
Speaker 1: and Florida. Uh. Yet we we do business in twenty
Speaker 1: three states via the Internet and direct mail, and we
Speaker 1: make more home mortgages than anyone else in the state
Speaker 1: of Ohio. We mark. We were talking earlier with our
Speaker 1: Bloomberg News colleague about some concerns among some congressmen that
Speaker 1: there are insufficient opportunities to provide credit for small and
Speaker 1: mid sized businesses. I'm wondering from your vantage point, you
Speaker 1: have a really good view into Middle America, do you
Speaker 1: feel that this is the case. Well, I do think
Speaker 1: that the regulatory environment is hampering uh those kinds of
Speaker 1: loans and that kind of expansion in the economy. Uh Uh, well,
Speaker 1: it's just DoD frank in itself requires Uh let's say,
Speaker 1: for a homeowner, if you own your own business, Uh,
Speaker 1: the ability to repay is a huge, huge issue because
Speaker 1: you have to show that you have uh W two's
Speaker 1: and you have to have tax returns to show your
Speaker 1: income to prove that you can pay for for the mortgages.
Speaker 1: And that's ten percent of our business. And it's really
Speaker 1: hard to get those people qualified because not everything is
Speaker 1: always shown on in a W twoe form or on
Speaker 1: their tax returns, and people who or their own businesses
Speaker 1: are very very uh stuck right now and trying to
Speaker 1: get home owns. And that's the middle class that's in
Speaker 1: Middle America that everyone's been saying, well, it has to grow,
Speaker 1: it has to grow, but specifically that Styman's the growth
Speaker 1: in in that particular area. Have you been able to
Speaker 1: I mean you're based in Ohio, as you said, I mean,
Speaker 1: have you been able to make your concerns and these
Speaker 1: challenges known to the officials that maybe could could affect
Speaker 1: some kind of change. Well, uh, right now, No, it
Speaker 1: doesn't matter because all those concerns fallen deaf ears. Uh yeah,
Speaker 1: because that Frank has has taken over the industry. And
Speaker 1: uh well, I think right now, I think everyone in
Speaker 1: the industry, and I think the general public is more
Speaker 1: optimistic given given the new president and the the push
Speaker 1: for a more of a are less emphasis on regulation.
Speaker 1: I think that that's going to be very helpful. But
Speaker 1: but to to try to appeal to the regulatory body,
Speaker 1: or to Congress, or to anybody, it's it's falls on
Speaker 1: deaf or has fallen on deaf ears, especially in the
Speaker 1: last eight years. Mark can you just sort of square
Speaker 1: something for me, because there I just want to contrast
Speaker 1: what you're talking about as far as credit conditions being
Speaker 1: too tight with a lot of fears of excessive froth
Speaker 1: in other parts of the credit market. You've seen that
Speaker 1: in corporate credit and uh, just this week the Federal
Speaker 1: Reserve eyeballed commercial real estate as a potential new area
Speaker 1: of froth. Do you think that that this is an
Speaker 1: accurate description of the sort of bigger credit markets or
Speaker 1: do you think that these are just completely bifurcated markets
Speaker 1: at this point? Well, I think that regulators, regulators, um,
Speaker 1: they don't know what they don't know, so they're always
Speaker 1: looking for the next next big thing to hit. And
Speaker 1: and I can't honestly say that one the regulatory environment
Speaker 1: has guessed, they've guessed right. It's usually they do a
Speaker 1: very good job of cleaning up the mess after something's happened.
Speaker 1: And uh, that's that's you know, that's what's happening with
Speaker 1: Don Frank. Yet there's unintended consequences where you know, big
Speaker 1: banks are basically the targets, but it's trickled down into
Speaker 1: all the banking and all the mid science banks, all
Speaker 1: the small banks. They're being choked. We are being choked
Speaker 1: by the regulatory environment. Uh. And it's to the detriment
Speaker 1: of the economy and detriment of people that once qualified
Speaker 1: at the third Federal for example, in qualify because we
Speaker 1: had a change our criteria based on the demand that
Speaker 1: you're seeing. Is the economy operating at a two g
Speaker 1: d p or is it operating at slower than current expectations.
Speaker 1: I think it's a little slower um. However, I think
Speaker 1: it is better. We were very very stagnant there for
Speaker 1: a long time. I think there's optimism in the air.
Speaker 1: I think the when the Fed moves on an interest rate,
Speaker 1: whether it be up or down, that gets people excited.
Speaker 1: And I think the anticipation of the Fed would like
Speaker 1: to see the Reserve raised interest rates three times this year.
Speaker 1: You know they could, and I don't think it's going
Speaker 1: to have a dramatic effect then on the on the
Speaker 1: market consumer. Really why is that? Well? I just think
Speaker 1: that psychologically people right now are in a real good place.
Speaker 1: People are very optimistic. So when when the raises rates
Speaker 1: a little bit against people more excited that they might
Speaker 1: go up further. So you get more volume coming in
Speaker 1: but frankly, I don't see how those those changes in
Speaker 1: interest rates going dramatically, you know, affected the consumer demand
Speaker 1: for for homes. I just don't think that it's going
Speaker 1: to move enough to put people that much out of
Speaker 1: the market. And think about it, when most of us
Speaker 1: were growing up, interest rates of seven eight nine percent
Speaker 1: were norm and I've been around long enough, I saw
Speaker 1: fifteen percent um that was horrific, and and now down
Speaker 1: to four percent. People are complaining that the right so
Speaker 1: might go up to four and a half or something
Speaker 1: for a thirty or fixth rate mortgage. That's not so bad.
Speaker 1: Although you know, some people have said that in the
Speaker 1: in the wake of these incredibly low interest rates that
Speaker 1: we've had since two thousand and eight, uh, that housing
Speaker 1: prices and commercial real estate prices have gotten away from themselves,
Speaker 1: and that as people, as the FED raises rates and
Speaker 1: as borrowing costs rise, we're going to see a sort
Speaker 1: of deflation of these bubbles. From your experience so far,
Speaker 1: do you observe a slowdown in demand or anything that
Speaker 1: suggests that there is a weakening in the housing market now?
Speaker 1: In fact, I think it's quite the opposite, because I
Speaker 1: think a lot of it, whether it be UM in
Speaker 1: any sector of the economy tends to feel to be
Speaker 1: feeled by UM UH perception UH and and consumer confidence.
Speaker 1: So I think the consumer confidence right now is pretty
Speaker 1: darn good, as good as it's been in the last
Speaker 1: eight to ten years. And I think that's going to
Speaker 1: go a long way. And of course we'll find out
Speaker 1: in the next four years how good that optimism will
Speaker 1: will hold. I want to thank you very much for
Speaker 1: spending time with us. Mark Stefanski is the chief executive
Speaker 1: of Third Federal Savings and Loan and you know, Lisa
Speaker 1: that his parents, Ben and Jerome they started fifth third
Speaker 1: Federal Savings alone. They started in nineteen thirty eight with
Speaker 1: just fifty dollars in initial capital. We've heard a lot
Speaker 1: of news overnight about President Trump's conversations with the Australian
Speaker 1: and Mexican UH leaders, and some of the language has been,
Speaker 1: uh sort of sort of incendiary, uh, to say the least.
Speaker 1: I want to bring in Marty Shanker, who heads the
Speaker 1: Washington bureau for Bloomberg News, and Marty, I want to
Speaker 1: start with, UH, what your take is on what we've
Speaker 1: heard overnight, is the US removing itself from its longest
Speaker 1: standing allies or is this just bluster? Well it would
Speaker 1: appear so. Um, but Donald Trump tweeted just a little
Speaker 1: while ago, you know, not to be concerned about his
Speaker 1: tough talks with our closest allies, and you know, uh,
Speaker 1: And Tim O'Brien has an interesting viewpiece today in which,
Speaker 1: you know, this notion of Trump having this grand plan
Speaker 1: and all of us in journalism trying to figure out
Speaker 1: just where everything fits. And he says, that's a fool's
Speaker 1: Errand this is coming from his gut. It's spontaneous. He
Speaker 1: feels he's doing the things he said he would do
Speaker 1: once he got elected. And he feels the US has
Speaker 1: been just too nice to the rest of the world,
Speaker 1: friends and foe alike. So he's going to do things
Speaker 1: his way. Hey, Marty of fair disclosure? How long have we?
Speaker 1: I mean, I I gotta say everything I learned. I
Speaker 1: think I learned that your knee at the Wall Street
Speaker 1: Journal I'm not not and I was just twelve years old, right, Yeah,
Speaker 1: well we were both in short pants. You know. It's
Speaker 1: been a long trip, Yes, it has, um what in
Speaker 1: your bones and your gut? All right? You talked about
Speaker 1: the president's gut. You're a journalist through and through in
Speaker 1: your gut, what what is going on and what needs
Speaker 1: I mean, you can't do this on a regular basis
Speaker 1: in twy not well, that's my question. In other words,
Speaker 1: something's got to give. Well, look there there, it's been
Speaker 1: like two weeks he's been president. He does he had
Speaker 1: very few members of his cabinet in place. That's being
Speaker 1: you know, we just saw Rex Tillerson at the State Department,
Speaker 1: and you know he was he's basically keeping the council
Speaker 1: of his closest adviser Steve Vannon, uh and others. Um.
Speaker 1: And he hasn't had the benefit of, you know, real
Speaker 1: time communication with people, with experienced people who are respected
Speaker 1: in their fields. And I think he has not been
Speaker 1: able to And he's always said he likes to hear
Speaker 1: dissident opinions, and by all accounts he's a great listener
Speaker 1: in private. And so I think that things can very
Speaker 1: easily be more moderate nature going forward. But I do
Speaker 1: think his impulsiveness will never go away. And um, for
Speaker 1: those of us who say to ourselves, this is going
Speaker 1: to slow down eventually, I think he got to guard
Speaker 1: against that. I think that he that he has decided
Speaker 1: this is the way he wants to communicate, and in fact,
Speaker 1: this is the way he wants to express policy, and
Speaker 1: he's going to continue to do that. What's the color
Speaker 1: that you're hearing from the Republican establishment in Congress and beyond, Well,
Speaker 1: they are steadfastly behind him. Uh, you know, I don't know.
Speaker 1: I have stated privately that I think that his support
Speaker 1: among the Republicans is razor thin um, and that he
Speaker 1: it's a tenuous relationship, but it is a solid one
Speaker 1: um for for now. I think the immigration uh proposals
Speaker 1: that he had tested that relationship and the Republicans lined
Speaker 1: up pretty solidly in favor of perhaps not the messaging
Speaker 1: but the policy itself. So and and the majority of
Speaker 1: Americans support it too. So I think the Republicans are
Speaker 1: going to stand by their president until such time as
Speaker 1: they themselves are threatened in terms of re election issues. Marty,
Speaker 1: can you just give us a reality check? Some people
Speaker 1: here the rhetoric of President Trump saying he's going to
Speaker 1: invade uh Mexico in a conversation that the White House
Speaker 1: now says was just a tough talk and a joke. Um,
Speaker 1: at what point, just taking this to its extreme. At
Speaker 1: what point does this lead to a real military altercation? Well,
Speaker 1: I think we're pretty far away from that. And I
Speaker 1: think Donald Trump got a stark example of what military
Speaker 1: confrontation means with the first death under his watch. And uh,
Speaker 1: you know, by all accounts, that is a very sobering
Speaker 1: moment for anyone, and especially a president who ultimately is
Speaker 1: responsible for all military activity. So I do think that
Speaker 1: a lot of these conversations, when they're put in print
Speaker 1: for in text, look a lot more vitriolic and our
Speaker 1: cast without context, without the nuance of actual conversation, and
Speaker 1: I think people tend to overreact to that. Let's turn
Speaker 1: to our allies for just a second. Phone calls with
Speaker 1: Prime Minister Turnbull in Australia. What's been your any details
Speaker 1: you can shed anything you can No, I mean, we
Speaker 1: have not been able to stand up that communication. You know,
Speaker 1: that was broken by the Washington Post in great detail.
Speaker 1: And you've got to assume someone who was privity to
Speaker 1: those conversations decided to leak it because they were concerned
Speaker 1: about it. Um. Just to be clear, it was a
Speaker 1: conversation where President Trump allegedly said, uh that it was
Speaker 1: the worst conversation that he had all day and basically
Speaker 1: threatened him with the refugee agreement that they had, that
Speaker 1: that the US previously came to with Australia, right and
Speaker 1: and and the Australian leader Turnbull later said, look, you
Speaker 1: know he was dismayed about the league and that the
Speaker 1: actually be the ending of that conversation was courteous, but
Speaker 1: be that as it may. Donald Trump came out and said,
Speaker 1: you know, don't worry about my tough talk. He has
Speaker 1: decided that he is keeping his promise. America comes first.
Speaker 1: He was very upset about this immigration deal and he
Speaker 1: was going to let turn Bill know, and he did.
Speaker 1: Got to affect businesses, yes, right, I mean you know
Speaker 1: you kind of I know, you stopped there on the
Speaker 1: political side, but then you gotta turn your attention and say, okay,
Speaker 1: so what are the effects here? Because you may be
Speaker 1: able to run a government as you just described it,
Speaker 1: but it's very hard to run a business. No, it's
Speaker 1: totally skill. And that's why this meeting with CEOs tomorrow
Speaker 1: is kind of in my task about it critically important. Well,
Speaker 1: this is his business council. These the people he asked
Speaker 1: to advise him. On policy and everybody from Jamie Diamond
Speaker 1: to Jane Metti, and it's very it's going to be
Speaker 1: very interesting. The tenor of what that meeting is going
Speaker 1: to be. Will they come in and say, Mr President,
Speaker 1: you're wrong on immigration, you're wrong on trade, you're wrong
Speaker 1: on taxes, or are they going to sit with hands
Speaker 1: folded and listen to Donald Trump say this is the
Speaker 1: way it's going to be. Um And you know they're
Speaker 1: from all parts of industry and banking and finance, so
Speaker 1: it's going to be interesting if they even have a
Speaker 1: unified message to give him. Well if if they do,
Speaker 1: or even if they don't, we're gonna be covering it.
Speaker 1: Marty Schanker, thank you very much, Senior Executive editor, Global
Speaker 1: Economics and Government for Bloomberg News. P and L is
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Speaker 1: visit proper cloth dot com custom shirts made Smarter. I
Speaker 1: want a story of innovation of how to look at
Speaker 1: the world today, makes sense of it, and then find
Speaker 1: an investment uh that is somewhat reliable. I want to
Speaker 1: bring in Paul more League, Global head of Market Economics
Speaker 1: and Chief Economist for North America at BNP. Pariba, Paul,
Speaker 1: where do you begin when you start with assessing your
Speaker 1: economic outlook? Beginning with the facts has a pretty good
Speaker 1: place to start. Where we've been and look at, you know,
Speaker 1: basically where the surveys are telling us we might go next,
Speaker 1: and what the settings of policy are. So you know
Speaker 1: the surveys currently look for the US look pretty perky. Well,
Speaker 1: let's look can we just like piece of the part
Speaker 1: just because I know tomorrow we're going to get the
Speaker 1: big payroll report number that will help people at least
Speaker 1: the confirm or deny their trajectory projections. You know, compare
Speaker 1: all that, but as an economist, just run through it.
Speaker 1: For US, GDP is running at at what we got
Speaker 1: a print at one point nine the last quarter on
Speaker 1: what are we running at now well, you know the
Speaker 1: Atlanta Fed he's saying for Q one day lateist GDP
Speaker 1: now forecast he's three point four. Okay, so we're three okay,
Speaker 1: So let's just say that Atlantage Fed GDP forecast three
Speaker 1: point four for Q one for unemployment four points where
Speaker 1: four point seven, and you know, we're pretty flat, maybe
Speaker 1: a bit of a downward trajectory for the unemployment rate
Speaker 1: going forward. Um, you know, labor participation rate moves or
Speaker 1: just I think I think it's going to be pretty
Speaker 1: flat more or less. But you know that if even
Speaker 1: if you've got growth of just two, that's above potential
Speaker 1: because the leather force is increasing by say half a
Speaker 1: point per year, productivity in the year to Q four
Speaker 1: was only one percent, so maybe productive potential is one
Speaker 1: and a half. So if we're running at two or above,
Speaker 1: unemployment should keep drifting down. Not very quickly because there
Speaker 1: are far fewer people out there than they used to be,
Speaker 1: but it should be drifting down, all right, and for
Speaker 1: and for at least I know, you want to know
Speaker 1: about inflation, because inflation is all about bonds. Yeah, I mean, well,
Speaker 1: I was just coming cost here. Well, yeah, I mean
Speaker 1: beyond that. I mean, but I'm trying to look into
Speaker 1: the crystal ball. Nobody can predict the future. I'm wondering,
Speaker 1: do you feel like you're less confident than you've ever
Speaker 1: been before with your predictions or do you think that
Speaker 1: people are overreacting to some of the macroeconomic and the
Speaker 1: political backdrop and that there is a very clear road ahead.
Speaker 1: I think people, you know, I think we've seen a
Speaker 1: tendency for the markets just after the November elections to
Speaker 1: one run off in one direction, and recently people are
Speaker 1: kind of extrapolating things in the other direction, because I
Speaker 1: think the technical term is they're walking back their estimates
Speaker 1: right here, driving with the rear view mirror. Maybe, but
Speaker 1: you know, it's difficult to come out with very firm
Speaker 1: expectations about where we're going to go on trade and
Speaker 1: physical and all these sort of things. So little spots
Speaker 1: of information that you get a very valuable because it's
Speaker 1: all you've got, but there's a tendency to extrapolate them.
Speaker 1: I think. So. Do you think that people have over
Speaker 1: inflated their expection expectations for inflation to your point, Pim, No,
Speaker 1: I don't think so. I think, you know, if you
Speaker 1: look globally where we're going on a inflation inflation is
Speaker 1: going up, and you see that in the producer price
Speaker 1: index in China, for example, You've seen it in Europe,
Speaker 1: you see it here. We've got a unique labor costs
Speaker 1: print just today of one point nine for the business sector,
Speaker 1: and the core measure of inflation that the FED likes
Speaker 1: is one point seven. So it's very likely to go up.
Speaker 1: And you know, one thing I would say about the
Speaker 1: Fed statement yesterday was that previously they said we believe
Speaker 1: inflation will rise, yesterday they said inflation will rise. So
Speaker 1: they sound more confident about their prediction of inflation. So
Speaker 1: what does that What does that mean for investors? Does
Speaker 1: that mean their bonds are are a bad better? Three
Speaker 1: rate hikes one rate, one rate hike a quarter. Well,
Speaker 1: I think you know, many people at the FED have
Speaker 1: said two or three rate hikes this year, and I
Speaker 1: think that's reasonable. The market is pricing about chance of march.
Speaker 1: I think that's probably too low, but I think the
Speaker 1: market will probably pricing a bigger chance, particularly we get
Speaker 1: strong pay rolls tomorrow, that probability he will go up.
Speaker 1: But I think the fade ideally would like to see
Speaker 1: what exactly are the fiscal plans, what exactly will growth be,
Speaker 1: And it won't get that to the second quarter. And
Speaker 1: that's why I'm a bit skeptical about March. Given this backdrop,
Speaker 1: what do you think is the one single best asset
Speaker 1: class for this year. I'm not an asset allocator. I'm
Speaker 1: just a humble economist. And so what's your biggest contrarian bet? Well,
Speaker 1: I think you know, the biggest contrarian bet is that
Speaker 1: we're going to see more more growth in the global
Speaker 1: economy and probably more growth in the US economy over
Speaker 1: the next two years than people expect. And I think
Speaker 1: that's partly becost the momentum coming into this year is
Speaker 1: pretty strong globally, and you know, US manufacturing looks very
Speaker 1: good despite the strong dollar, and we yet to see
Speaker 1: fiscal stimulus. Thank you very much for joining us. Poor
Speaker 1: mortem rely look forward to having you in the future.
Speaker 1: He is the head of Market Economics and the chief
Speaker 1: economists for Baten Pete Party Bop. Matt Levine Bloomberg View columnist.
Speaker 1: He wrote a really terrific column talking about how, first
Speaker 1: of all, a lot of people dismissed President Trump's rhetoric
Speaker 1: pre his election as simply talk and that he wouldn't
Speaker 1: actually come through on that, and that now people are realizing, well,
Speaker 1: perhaps they were mistaken. Um, first, can you just talk
Speaker 1: about what you've observed about how the reaction has been
Speaker 1: shockingly surprising when he's come through on a lot of
Speaker 1: what he said. Yeah, there's like, there's two things going
Speaker 1: on here right. One is that people listen to what
Speaker 1: he said and thought he didn't mean it. And so
Speaker 1: Trump talked about cracking down on trading immigration throughout the campaign.
Speaker 1: Those were his focuses, and people sort of assumed he
Speaker 1: would turn out to be a conventional Republican president and
Speaker 1: interested in economic growth and tax cuts and deregulation and
Speaker 1: things like that. And since the inauguration, it's been pretty
Speaker 1: clear where his focus is, and it's exactly where he
Speaker 1: said it was. So I think some of the business
Speaker 1: leaders who were expecting a very conventional, uh presidency are
Speaker 1: getting this very unconventional, anti trade, anti immigration presidency. Well,
Speaker 1: but why wouldn't potentially this end up being just as
Speaker 1: good for them as they thought if he does go
Speaker 1: ahead and follows through with cutting regulations and cutting taxes.
Speaker 1: I mean, why wouldn't this be a benefit. Well, one
Speaker 1: thing is that a lot of business groups were not
Speaker 1: um so happy about the trade stuff. You know that
Speaker 1: we live in a global economy and a lot of
Speaker 1: American businesses are multi national companies, and so they're going
Speaker 1: to lose that by the correctown and trade. But the
Speaker 1: other thing that's happening is that, you know, even if
Speaker 1: eventually we come through on the deregulation and tax cuts
Speaker 1: that businesses want, I think that they underestimated the risks
Speaker 1: of just sort of the instability of the Trump presidency.
Speaker 1: And you saw that with the executive order last weekend.
Speaker 1: It's one thing to say we're gonna cut back on
Speaker 1: or or even eliminate refugee programs, but what happened is
Speaker 1: that they eliminated them while people with valid visas were
Speaker 1: in the air. They told Green card holders that they
Speaker 1: couldn't come back to the country, and then after a
Speaker 1: sort of weekend of controversy, some of that was was
Speaker 1: walked back. And so what you have is this totally
Speaker 1: um sort of whimsical policy making process where real people
Speaker 1: are getting caught up in these decision making, in these
Speaker 1: decisions that don't really have much um UH process or
Speaker 1: thought behind them. And I think what companies are realizing
Speaker 1: is that that affects them to write like the rule
Speaker 1: of law is pretty central to running a big multinational
Speaker 1: company or running a big company in America, and you
Speaker 1: need to have some predictability instability, And what they're seeing
Speaker 1: here is an administration that is not really interested in
Speaker 1: those norms and is willing to create a lot of instability. Well, Matt,
Speaker 1: let me just push back a little bit here, because
Speaker 1: if you read speeches that at the time candidate at
Speaker 1: Trump was crossing the country, I believe, in fact, there
Speaker 1: was one in Gettysburg, Pennsylvania where he laid out very
Speaker 1: specifically what he planned to do if elected president. And
Speaker 1: I would imagine, I mean, I want to know who
Speaker 1: are these people that are so surprised? First of all,
Speaker 1: because if you've I mean, he's not. It's not as
Speaker 1: if he's deviated during the campaign from you know, the
Speaker 1: set program of whether it is trade policy, whether it
Speaker 1: is UH financial regulation, or you know variety of things. Um,
Speaker 1: how do you respond to that? Well, first of all,
Speaker 1: I would disagree that he laid anything out specifically or clearly, right,
Speaker 1: I mean, you have every policy position he took He
Speaker 1: still he took out every policy position at some point
Speaker 1: during the campaign. You know, right now there's pushback from
Speaker 1: the White House saying that the immigration order is not
Speaker 1: a Muslim ban. But of course during the campaign he
Speaker 1: put out a press what he's saying, we'll have a
Speaker 1: Muslim ban. So it's not really clear what he said.
Speaker 1: We're not in a court of law here. I mean,
Speaker 1: this is not not you're not not parsing each things.
Speaker 1: I'm just saying that he's set out pretty clearly what
Speaker 1: his policies were going to look. I agree with that.
Speaker 1: I think I think there is a constituency. And you know,
Speaker 1: like the sort of leading light is Anthony Scaramucci, who's
Speaker 1: a Trump advisor, who sort of gave interview saying he's
Speaker 1: going to make smart trade deals and and not have
Speaker 1: a Muslim ban, and and and do all these things
Speaker 1: that that are more conventional Republican policies. And I think
Speaker 1: that some of the people in that sort of New
Speaker 1: York financial circle heard that. But the other thing that
Speaker 1: I'm saying is that even even leaving like policy disagreements aside,
Speaker 1: what I think people are surprised by is the just
Speaker 1: sort of haphazard, uh nature of the Trump administration where
Speaker 1: there's not a lot of respect for process or for
Speaker 1: the rule of law, and that is what I think
Speaker 1: is going to become more concerning. You know, you have
Speaker 1: companies that say, look, you know, trade is trade policy
Speaker 1: is one thing we can disagree substantively. But having a
Speaker 1: president who is going to attack companies that disagree with
Speaker 1: him politically, either by tweets or by uh, you know,
Speaker 1: suggesting that the Justice Department hold up mergers of of
Speaker 1: media companies he doesn't like, which is something he said
Speaker 1: that a little history well, right, right, I mean then
Speaker 1: you've got to be a little bit informed that this
Speaker 1: is something that there are many images of of even
Speaker 1: executives tangling with the US government. Right, well, but this
Speaker 1: is but I think that that Matt, you raise a
Speaker 1: point that cass Sunstine of Harvard made as well, which
Speaker 1: is sort of there has to be the sense that
Speaker 1: the rule of law is a consistent and reliable way
Speaker 1: of an application of law, and if it's sort of
Speaker 1: arbitrarily crafted or targeted to target specific companies or specific issues,
Speaker 1: it doesn't work. Yeah, I mean, you you what you
Speaker 1: what you want is a sort of predictable, uh environment
Speaker 1: in which to operate, where you can kind of know
Speaker 1: that your investments will be respected and paid off. And
Speaker 1: I think that's what people are worried about right now.
Speaker 1: Great point and great column. Thank you very much, Matt Levine.
Speaker 1: Look forward to having you more in the future. He
Speaker 1: is a columnist for Bloomberg View. You can follow him
Speaker 1: on Twitter at Matt underscore Levine. His columns stability is
Speaker 1: good for business. Trump's whims threaten it. Thanks for listening
Speaker 1: to the Bloomberg P and L podcast. You can subscribe
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Speaker 1: Twitter at pim Fox. I'm out there on Twitter at
Speaker 1: Lisa Abramo. It's one before the podcast. You can always
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