WEBVTT - Morgan Stanley Shift Bears Fruit, Momentum Slows 0:00:02.920 --> 0:00:08.160 Bloomberg Audio Studios, Podcasts, radio news. 0:00:08.560 --> 0:00:12.920 This is Bloomberg Business Wait inside from the reporters and 0:00:13.080 --> 0:00:16.640 editors who bring you America's most trusted business magazine, plus 0:00:16.720 --> 0:00:20.880 global business, finance and tech news. The Bloomberg Business Week 0:00:20.920 --> 0:00:25.840 podcast with Carol Messer and Tim Stenebek from Bloomberg Radio. 0:00:27.000 --> 0:00:29.960 Here's a Morgan Stanley up six point seven percent right now, 0:00:30.080 --> 0:00:33.960 best day in just about four years. Also at a 0:00:34.159 --> 0:00:36.560 record right now, Morgan Stanley traders and bankers joining the 0:00:36.600 --> 0:00:38.879 rest of their Wall Street rivals in posting better than 0:00:38.920 --> 0:00:42.080 expected revenue. It fueled a thirty two percent profit surge 0:00:42.159 --> 0:00:44.680 for the third quarter, cent shares up the most in 0:00:44.800 --> 0:00:47.680 close to four years. Here's Morgan Stanley's CEO, Ted Pic 0:00:47.840 --> 0:00:51.000 earlier today in an interview on Bloomberg to TV speaking 0:00:51.000 --> 0:00:53.840 to Shanoli Basek about his view of the economy and 0:00:54.040 --> 0:00:54.720 the consumer. 0:00:55.400 --> 0:00:58.040 We don't know what the policy reaction function is actually 0:00:58.120 --> 0:01:00.480 going to be off of what has been said, and 0:01:00.520 --> 0:01:02.280 for that reason, I think you have a number of 0:01:02.320 --> 0:01:04.720 investors that are actually just sort of continuing to plow 0:01:04.800 --> 0:01:08.039 forward on the view that the economy is in pretty 0:01:08.080 --> 0:01:11.720 good shape and the consumers and corporates are in great shape, 0:01:12.040 --> 0:01:15.399 so that when there is an election outcome, once there's 0:01:15.400 --> 0:01:18.120 a sense for whether new policy will actually get affected, 0:01:19.120 --> 0:01:20.880 then they can have a reaction. 0:01:21.440 --> 0:01:23.600 I couldn't help, but notice he said when there is 0:01:23.760 --> 0:01:25.759 an election outcome, a lot of folks saying it won't 0:01:25.800 --> 0:01:30.200 necessarily happen. The day after three weeks from yesterday, we 0:01:30.240 --> 0:01:32.720 got with us Alison Williams Bloomberg Intelligence, a senior at 0:01:32.720 --> 0:01:34.720 Global Banks analyst. She joins us here in the Bloomberg 0:01:34.840 --> 0:01:38.680 Business Week studio. Alison quite a few highlights from this report. 0:01:38.760 --> 0:01:41.240 Revenue from the trading business rising thirteen percent, the wealth 0:01:41.319 --> 0:01:46.080 unit also standing out higher than analyst expectations. What worked 0:01:46.080 --> 0:01:47.640 so well for more than Stanley this quarter. 0:01:47.960 --> 0:01:51.040 I think it was the rebound in well flows that 0:01:51.480 --> 0:01:54.720 investors are excited about. But to be clear, the business 0:01:54.840 --> 0:01:57.240 is hitting on all cylinders, so there was a broadbeat 0:01:57.760 --> 0:02:00.600 across the bank. The institution was the biggest of the 0:02:00.640 --> 0:02:04.480 beat this quarter. Equity trading very strong. They're tilted more 0:02:04.520 --> 0:02:06.840 towards the business. It was strong for everybody, but they 0:02:06.840 --> 0:02:10.880 also had a little bit better growth there. Debt fees 0:02:11.000 --> 0:02:13.359 also sort of leading the way on the feat side 0:02:13.400 --> 0:02:17.080 of things. But the wealth business really is the core 0:02:17.240 --> 0:02:20.120 of their business. They've shifted more towards the wealth and 0:02:20.160 --> 0:02:24.720 asset management over the years, especially under Gorman. And they 0:02:25.200 --> 0:02:26.960 had sort of a little bit of a short blow 0:02:27.000 --> 0:02:29.080 and flows last quarter, and so I think really seeing 0:02:29.120 --> 0:02:32.680 the strength of the rebound is giving investors some confidence 0:02:32.680 --> 0:02:33.320 in those shares. 0:02:34.120 --> 0:02:36.519 Let's talk about the shares though, because Morgan Stanley shares 0:02:37.200 --> 0:02:39.919 up about six point seven percent at the moment. At 0:02:39.919 --> 0:02:42.720 one point they were up by more than eight percent currently, 0:02:42.800 --> 0:02:46.120 the biggest rally since December twenty twenty three, when it 0:02:46.160 --> 0:02:48.240 was up by eight percent. That was the biggest rally 0:02:48.240 --> 0:02:52.760 since November twenty twenty, which was quite a time in markets, 0:02:52.760 --> 0:02:53.440 to say the least. 0:02:53.560 --> 0:02:54.880 Yeah, that vaccine, right. 0:02:54.840 --> 0:02:57.160 Yes, exactly, that was COVID. That was well. I think 0:02:57.200 --> 0:03:01.200 it was on Monday too. Yeah, me too. You were here, 0:03:01.240 --> 0:03:03.960 you'd been here for like a month. Yeah, anyway, Allison, 0:03:05.040 --> 0:03:05.959 like you said. 0:03:06.160 --> 0:03:09.800 And hitting new highs. Yeah, I think, you know, in general, 0:03:09.960 --> 0:03:13.680 this earning season, you know, the stock reactions have been 0:03:13.800 --> 0:03:17.680 very strong. I think investors are getting excited about the 0:03:17.720 --> 0:03:21.400 capital market story. I think trading we had so many 0:03:21.480 --> 0:03:25.600 years where it was underwhelming, the pandemic huge surge, and 0:03:25.720 --> 0:03:29.520 since then we've really seen trading proved to be resilient 0:03:30.040 --> 0:03:33.280 this year. It's equities that's outperforming, but we're within a 0:03:33.400 --> 0:03:38.440 historically high range. And then on the investment banking fee side, 0:03:38.720 --> 0:03:41.560 that super strong year twenty twenty one, all kinds of 0:03:41.600 --> 0:03:45.120 records a week since, but now starting to see some 0:03:45.160 --> 0:03:48.000 signs of life, and so investors are getting excited about 0:03:48.000 --> 0:03:48.760 both of those things. 0:03:48.800 --> 0:03:50.960 I hear what you're saying, but is it that good. 0:03:51.000 --> 0:03:52.760 I hear what you're saying that they beat across the board, 0:03:52.800 --> 0:03:55.880 firing on all cylinders. Is it worth a six point 0:03:55.960 --> 0:03:57.480 seven percent reaction in the shares? 0:03:58.160 --> 0:04:02.360 So again, we don't comment, We don't recommend stocks. I 0:04:02.360 --> 0:04:04.840 just have to be careful about yes. 0:04:05.160 --> 0:04:07.440 I mean not asking for recommendation, but I mean. 0:04:07.600 --> 0:04:09.920 If if I was an investor, I guess the way 0:04:09.960 --> 0:04:12.840 I would think about it is it's a super strong market. 0:04:13.960 --> 0:04:17.200 I think about both Morgan, Stanle and Goldman as riding 0:04:17.279 --> 0:04:21.679 a strong tailwind. So they have strengths, they're leveraging those strengths, 0:04:21.680 --> 0:04:25.000 but there is a very strong tail win from the market. 0:04:25.640 --> 0:04:29.160 And the view going forward is do you think that 0:04:29.480 --> 0:04:32.800 momentum continues? We see momentum in the near term, but 0:04:32.839 --> 0:04:34.760 I think you have to think about sort of the 0:04:34.800 --> 0:04:37.119 weeks and months ahead. Morgan Stanley again has some pretty 0:04:37.160 --> 0:04:41.240 aggressive targets out there for AUM growth set out by Gorman. 0:04:41.400 --> 0:04:45.920 The wealth management pretext margin. When markets are up, revenue 0:04:45.960 --> 0:04:49.800 is up, margins are good. But they you know Ted 0:04:49.839 --> 0:04:51.880 Pick had lowered that a little bit in the near term. 0:04:52.400 --> 0:04:54.320 You know, will he raise that back up towards the 0:04:54.400 --> 0:04:59.000 higher thirty percent goal and will Morgan Stanley marched towards 0:04:59.040 --> 0:05:01.160 that overtime? I think that's the long term question for 0:05:01.279 --> 0:05:02.000 Morgan Stanley. 0:05:02.080 --> 0:05:05.240 Can you help me and our listeners and viewers understand 0:05:05.560 --> 0:05:10.479 the asset management business, the wealth management business, because we 0:05:10.640 --> 0:05:13.840 hear over and over again in the long term it's 0:05:13.880 --> 0:05:18.400 difficult to be just investing in indices. I know it's, 0:05:18.520 --> 0:05:21.000 you know, kind of sacrilegious to actually say that, but 0:05:21.000 --> 0:05:22.320 if you look at the research. 0:05:22.600 --> 0:05:25.000 You're tilling a dangerous pass it points. 0:05:25.080 --> 0:05:27.200 You know, you see that time and time again, Alison. 0:05:27.680 --> 0:05:32.200 Yet you still have these banks attracting very smart money 0:05:33.360 --> 0:05:38.080 for a product that charges a fee. What what are 0:05:38.160 --> 0:05:42.080 investor what do clients get and what are investors getting 0:05:42.080 --> 0:05:42.360 out of that? 0:05:43.320 --> 0:05:46.720 So so I'll say a few things. So Morgan Stanley's 0:05:46.800 --> 0:05:49.320 investment management business I know pretty well since I used 0:05:49.320 --> 0:05:53.440 to work there. The strength there is alternatives and fixed income, 0:05:53.600 --> 0:05:59.080 where you definitely do see good returns. Their equities business 0:05:59.200 --> 0:06:03.240 is actually very focused on active you know, having a 0:06:03.360 --> 0:06:05.880 very strong active share and concentrated bit so it can 0:06:05.920 --> 0:06:09.640 be more volatile. So I think within you know, the 0:06:10.040 --> 0:06:14.200 argument about you know, all when you look across and 0:06:14.240 --> 0:06:17.159 the you know, all managers aren't going to be beat 0:06:17.160 --> 0:06:19.320 the index, right, But I think if you are buying 0:06:19.360 --> 0:06:22.240 an active fund, you do want to buy something that 0:06:22.440 --> 0:06:26.480 is making bets right, not just hugging the benchmark, as 0:06:26.560 --> 0:06:28.359 you say. And so I think that's what we've seen 0:06:28.440 --> 0:06:32.000 in the industry over the last you know, decade or so, 0:06:32.120 --> 0:06:36.159 you know, perhaps longer, but accelerating is Look, I can 0:06:36.240 --> 0:06:39.520 pay for I can get beta cheap, I can get 0:06:39.520 --> 0:06:42.719 you know, get those cheap funds, those index funds, but 0:06:42.839 --> 0:06:46.000 for alpha, right, you are seeing flows and you see 0:06:46.000 --> 0:06:48.160 it also on the hedge fund side as well. The 0:06:48.200 --> 0:06:51.960 hedge funds that can deliver consistently better returns are the 0:06:51.960 --> 0:06:56.159 ones that are getting assets and and you know, turning 0:06:56.200 --> 0:06:58.640 to the wealth side, of things. I would also say 0:06:58.680 --> 0:07:02.159 that business has really evolved over time, and so you know, 0:07:02.279 --> 0:07:05.799 years ago, you know, maybe at the turn of the century, 0:07:05.839 --> 0:07:08.360 if you will, it was about fund of the month, 0:07:08.480 --> 0:07:10.360 or this will make you this stock will make you 0:07:10.360 --> 0:07:12.080 the most money, this fund will make you the most money. 0:07:12.080 --> 0:07:14.760 But the industry, I think is really focusing on client needs, 0:07:14.800 --> 0:07:17.720 client investments, and so that's really been a shift. 0:07:17.840 --> 0:07:20.720 Thirty seconds now that the big banks are wrapped up, 0:07:20.800 --> 0:07:23.720 we heard Ted Pick say that consumers and corporates are 0:07:23.760 --> 0:07:26.680 in great shape. How would you characterize, Alison, sort of 0:07:26.720 --> 0:07:28.880 the holistic view that we got from the big banks 0:07:29.120 --> 0:07:31.200 over the last week or so in terms of commentary 0:07:31.240 --> 0:07:32.440 on the consumer good place. 0:07:32.880 --> 0:07:35.240 I think it's very good. And I think that's another 0:07:35.280 --> 0:07:39.680 reason why you're seeing some strong reactions because things, you know, 0:07:40.240 --> 0:07:43.600 healthy credit came in healthy, right, that's what people are 0:07:43.600 --> 0:07:46.240 concerned about. And if rates are coming down and we 0:07:46.280 --> 0:07:49.920 are tilting more towards our software ending scenario, that's very 0:07:49.920 --> 0:07:50.720 good for the banks. 0:07:50.880 --> 0:07:54.400 Alison Williams, Bloomberg Intelligence Senior Global Banks Analysts, joining us 0:07:54.400 --> 0:07:56.960 here in the Bloomberg Business Week Studio. 0:07:57.920 --> 0:08:01.720 You're listening to the Bloomberg Business Podcast Catch US Live 0:08:01.800 --> 0:08:04.840 weekday afternoons from two to five pm Eastern Listen on 0:08:04.880 --> 0:08:07.440 Apple card Play and then brout Auto with a Bloomberg 0:08:07.480 --> 0:08:12.720 Business act or wants us Live on YouTube. 0:08:11.520 --> 0:08:15.280 The Katie Graidbelt. Think back to recent history of presidential campaigns. 0:08:15.800 --> 0:08:17.000 Barack Obama two thousand and eight. 0:08:17.120 --> 0:08:17.760 I remember him. 0:08:17.960 --> 0:08:19.120 You think you were in high school? 0:08:19.240 --> 0:08:20.560 Yeah, this point I was. 0:08:20.920 --> 0:08:22.840 He was pitching back then, a complete overhaul of the 0:08:22.920 --> 0:08:27.000 US health insurance system. Now we have Obamacare. Four years later, 0:08:27.040 --> 0:08:29.800 Mitt Romney, he had the elaborate set of proposals for 0:08:29.880 --> 0:08:34.160 reigniting economic growth after the Great Recession. Hillary Clinton in 0:08:34.200 --> 0:08:37.280 twenty sixteen. She had the position papers on everything from 0:08:37.360 --> 0:08:41.280 raising the federal minimum wage to establishing paid family leave. 0:08:41.760 --> 0:08:44.360 This all from a recent column by Bloomberg Business Week 0:08:44.440 --> 0:08:47.760 editor Brad Stone, who writes that this presidential cycle has 0:08:47.760 --> 0:08:51.560 been largely devoid of such ideological ambition. He argues that 0:08:51.600 --> 0:08:53.760 it seems like we've lost our appetite for big ideas. 0:08:53.760 --> 0:08:58.280 In many respects, it's been the ozembic election. Brad not 0:08:58.360 --> 0:09:00.640 just the editor of Bloomberg Business He's also the author 0:09:00.679 --> 0:09:03.640 of four books, including New York Times bestseller Amazon un Bound. 0:09:03.679 --> 0:09:06.280 Jeff Bezos and the invention of a global empire. He 0:09:06.360 --> 0:09:09.720 joins us here in the Bloomberg BusinessWeek studio, Brad, what 0:09:09.800 --> 0:09:12.880 are we getting from the presidential campaigns this time around? 0:09:12.960 --> 0:09:14.280 If we're not getting the big ideas? 0:09:14.360 --> 0:09:18.000 Yeah, thanks, Tim. Look, I don't want to minimize it. 0:09:18.120 --> 0:09:21.560 I mean, Kamala Harris. You know, the campaign's gotten off 0:09:21.559 --> 0:09:26.160 to a late start. We've gotten targeted proposals aimed at 0:09:26.160 --> 0:09:29.640 helping parents, renters, first time home buyers. You know, I 0:09:29.679 --> 0:09:33.920 don't want to minimize former President Donald Trump's proposals. You know, 0:09:33.960 --> 0:09:38.679 those tariffs would be a significant change to our economy. 0:09:38.840 --> 0:09:42.120 But when you look back at the kinds of sweeping 0:09:42.400 --> 0:09:46.440 economic proposals that Barack Obama was making, or you know, 0:09:46.480 --> 0:09:49.760 Bill Clinton or the first George Bush, you know, really 0:09:50.200 --> 0:09:53.800 big ideas, and you wonder why it's not happening this cycle. 0:09:53.840 --> 0:09:55.080 And I think there are two reasons. 0:09:55.240 --> 0:09:55.440 You know. 0:09:55.480 --> 0:09:58.920 The first is tactical. I mean, this is it may 0:09:58.960 --> 0:10:04.520 not be as much of an ideological battle, but it 0:10:04.600 --> 0:10:09.200 is certainly a battle between parties, personalities, kinds of sides 0:10:09.240 --> 0:10:12.280 of the American divide, and both sides see the other 0:10:12.440 --> 0:10:15.800 success as an existential threat and are determined to win, 0:10:15.960 --> 0:10:20.120 and winning right now involves cobbling together a coalition. It's 0:10:20.160 --> 0:10:23.800 why Trump is talking to all women today on Fox 0:10:23.880 --> 0:10:27.440 News and the vice presidents doing a town hall with 0:10:27.480 --> 0:10:30.160 Fox News. This is all about seven states and swing voters. 0:10:30.520 --> 0:10:32.800 And then the second question is really what can you 0:10:32.840 --> 0:10:35.280 get Can you get anything sweeping done today in a 0:10:35.320 --> 0:10:39.439 bitterly divided Congress that is devoted to the politics of 0:10:39.480 --> 0:10:40.760 opposition right. 0:10:40.760 --> 0:10:44.960 Recent history would suggest no to that last question, and 0:10:45.000 --> 0:10:47.480 you hedged yourself nicely said you don't want to minimize this, 0:10:47.800 --> 0:10:50.360 And my pushback would be something that you touch on 0:10:50.400 --> 0:10:54.280 in the piece. You have Donald Trump proposing nineteenth century 0:10:54.360 --> 0:10:56.880 style tariffs? Is that not a big idea? 0:10:57.280 --> 0:11:03.120 No, it's I think in its way, you know, it 0:11:03.240 --> 0:11:07.439 is a big idea. It's certainly dramatic. I mean, there 0:11:07.679 --> 0:11:10.400 are real open questions about how kind of serious he 0:11:10.520 --> 0:11:13.480 is about it and how much he can get done. 0:11:13.720 --> 0:11:16.800 You know. But in terms of like identifying the gaps 0:11:17.360 --> 0:11:21.640 in the in the American safety net, the you know, 0:11:21.679 --> 0:11:26.280 the institutional challenges we have, the existential threats to the country, 0:11:26.280 --> 0:11:32.440 to the world, like climate change, like solving the ballooning deficit. 0:11:32.960 --> 0:11:36.040 You know, neither candidate has really addressed the kind of 0:11:36.320 --> 0:11:39.000 you know, sweeping problems that we have, in part because 0:11:39.160 --> 0:11:43.559 those problems often involve big dose or reality and a 0:11:44.080 --> 0:11:47.480 heavy dose of bad news, and they're both trying to, 0:11:47.600 --> 0:11:50.559 as I said, cobble together a winning coalition and prevent 0:11:50.600 --> 0:11:51.800 the other side from taking power. 0:11:52.000 --> 0:11:56.239 I wonder if this changes after the election, and if somehow, 0:11:56.440 --> 0:12:00.120 whoever wins the election is given a dose of reality 0:12:00.679 --> 0:12:04.520 by maybe some sort of crisis or bond vigilantes. 0:12:04.600 --> 0:12:07.920 What's more than that? I mean, in the old I'm 0:12:07.960 --> 0:12:11.280 old enough to remember where winning presidents had a honeymoon 0:12:11.360 --> 0:12:13.760 period where you could talk about the first hundred days, 0:12:13.760 --> 0:12:16.640 where even if you didn't have both branches of Congress, 0:12:16.640 --> 0:12:20.840 you came out of an electoral victory smelling like a winner, 0:12:20.920 --> 0:12:23.000 and the other party kind of fell into line and 0:12:23.080 --> 0:12:26.200 let you pass an element of your agenda. I don't 0:12:26.200 --> 0:12:28.160 think that's going to happen. I think the dose of 0:12:28.240 --> 0:12:31.320 reality is coming from you know, we go back to 0:12:31.320 --> 0:12:34.720 what Mitch McConnell said in two thousand and eight when 0:12:34.720 --> 0:12:37.360 Barack Obama won, and he said our mission is to 0:12:37.400 --> 0:12:39.559 make him a one term president, and that those are 0:12:39.559 --> 0:12:42.640 the politics that we have right now and until we 0:12:42.679 --> 0:12:45.960 move beyond the politics of opposition, I think we're and 0:12:46.000 --> 0:12:49.720 this is the point of the piece, that our presidential candidates, 0:12:49.960 --> 0:12:52.520 our national leaders are going to have to be a 0:12:52.520 --> 0:12:54.760 little limited in their ambition so that they don't end 0:12:54.840 --> 0:12:56.560 up overpromising and under delivering. 0:12:56.880 --> 0:12:59.400 Well also write that it's a vicious circle. And I mean, 0:12:59.480 --> 0:13:01.480 I was going to do you think that it's realistic 0:13:01.480 --> 0:13:04.160 that we do get to that place where we do 0:13:04.320 --> 0:13:07.040 move beyond this cycle or whatever you want to call 0:13:07.120 --> 0:13:08.720 or do you think that it's actually built into the 0:13:08.760 --> 0:13:12.959 way that we elect presidents for this dynamic to unfold. 0:13:13.520 --> 0:13:15.960 This is where Katie, I'm trying Matt to come off 0:13:15.960 --> 0:13:18.440 as like the cynical old guy. I mean, I think, 0:13:18.840 --> 0:13:21.080 you know, we need to maybe flush some of the 0:13:21.120 --> 0:13:26.199 current politics out of our system. Maybe that's through decisive 0:13:26.240 --> 0:13:28.960 defeats of one side or the other. I think the 0:13:29.000 --> 0:13:31.400 parties have to come to a kind of reckoning about 0:13:31.480 --> 0:13:35.040 putting country before party, and I think it's going to 0:13:35.080 --> 0:13:38.319 require superlative leader who can get beyond the politics of 0:13:38.360 --> 0:13:41.400 opposition and the feeling that the other side success is 0:13:41.400 --> 0:13:44.920 in existential danger. And whether either one of those two 0:13:44.960 --> 0:13:48.160 candidates are that superlative leader who can grow beyond you know, 0:13:48.280 --> 0:13:53.000 our current situation, our current paralysis. I think it remains 0:13:53.000 --> 0:13:53.480 to be seen. 0:13:54.040 --> 0:13:56.520 Help me be not cynical about this, because I'm thinking 0:13:56.520 --> 0:14:00.640 to myself, Okay, I don't see this improving in a 0:14:00.920 --> 0:14:04.640 world where, uh, you know, California has two senators and 0:14:04.640 --> 0:14:08.800 Wyoming has two senators. So essentially the representation that somebody 0:14:09.120 --> 0:14:12.680 in Wyoming has in the Senate is essentially much greater 0:14:12.720 --> 0:14:15.320 than somebody in you know, your state of California, given 0:14:15.360 --> 0:14:18.360 the population differences, but the structure of the government and 0:14:18.400 --> 0:14:21.320 the fact that it only matters in seven states when 0:14:21.320 --> 0:14:24.800 it comes to the presidential election. It's it's pretty tough. 0:14:24.600 --> 0:14:25.640 Out there, it is. 0:14:25.720 --> 0:14:28.880 And I think it also a major problem is that 0:14:29.160 --> 0:14:33.880 some of our institutions, you know that used to unify 0:14:34.000 --> 0:14:40.200 this country, local media, local parties, where parties you know, 0:14:40.320 --> 0:14:44.520 by county by state would differ from the national party. 0:14:45.880 --> 0:14:50.920 Those intermediating institutions are also on the decline, and trust 0:14:50.920 --> 0:14:53.320 in them has never been as low. So, you know, 0:14:53.480 --> 0:14:55.280 I agree, I agree with you. It's hard not to 0:14:55.520 --> 0:14:59.840 It's hard to find reasons for optimism, you know it 0:15:00.120 --> 0:15:03.680 with the current state of affairs the kind of institutional 0:15:04.600 --> 0:15:06.600 change that I am talking about a little bit in 0:15:06.640 --> 0:15:10.440 the piece, getting rid of the filibuster, getting rid of 0:15:10.440 --> 0:15:13.320 the electoral college. Frankly, those it's very difficult to see 0:15:13.320 --> 0:15:15.720 how we achieve those. Those are such I. 0:15:15.640 --> 0:15:17.120 Can see one group wanting to get rid of it. 0:15:17.240 --> 0:15:20.800 Yeah, they seem a little third rail right now in 0:15:20.840 --> 0:15:21.800 our current politics. 0:15:22.160 --> 0:15:24.440 Well, talk about I mean, we were talking about Congress 0:15:24.440 --> 0:15:26.200 earlier and how it's hard to get anything done. We 0:15:26.240 --> 0:15:28.320 did get certain things done. You think about the Inflation 0:15:28.400 --> 0:15:32.000 Reduction Act for example. I mean I speak to a 0:15:32.000 --> 0:15:35.320 lot of executives and a lot of them have cited 0:15:35.360 --> 0:15:37.240 to me that that has been a big help for them. 0:15:37.240 --> 0:15:39.440 And then I mean, we could get into the Chips Act, 0:15:39.960 --> 0:15:42.360 but with what's going on with Intel, that's a different conversation. 0:15:42.400 --> 0:15:44.720 But in any case, I mean, talk to us about 0:15:44.840 --> 0:15:49.000 how that can still happen even with this gridlock exactly. 0:15:49.080 --> 0:15:54.760 And the President has used the budget reconciliation process, and 0:15:54.800 --> 0:15:56.880 there are some strict rules on what you can get 0:15:56.920 --> 0:16:01.960 done through that process and then with a simple majority, 0:16:02.000 --> 0:16:05.040 and you know, recently the vice president has cast the 0:16:05.080 --> 0:16:07.840 deciding vote. But they do have to be budget related 0:16:07.960 --> 0:16:10.760 items and so you know, when you talk about things 0:16:10.880 --> 0:16:14.960 like raising the minimum wage, I mean, it's it's almost 0:16:15.080 --> 0:16:19.400 ridiculous that in decades it hasn't been accomplished, or you know, 0:16:19.560 --> 0:16:23.960 universal childcare or parental leave, the things where this country 0:16:24.200 --> 0:16:28.080 now badly lags most of the developing world. You can't 0:16:28.080 --> 0:16:31.560 get it done because it would require a filibuster proof 0:16:31.600 --> 0:16:34.800 majority in the Senate. So there is this tiny little 0:16:35.080 --> 0:16:37.920 loophole to kind of get things done. And the Biden 0:16:37.920 --> 0:16:42.000 administer and executive orders are another way. And obviously when 0:16:42.320 --> 0:16:44.520 Donald Trump was in office he took full advantage of 0:16:44.560 --> 0:16:47.440 that as as President Biden. But you know those are 0:16:47.600 --> 0:16:50.560 like the mechanisms that are left at the disposal of 0:16:50.600 --> 0:16:53.160 the current and soon the new president, and you know 0:16:53.240 --> 0:16:55.880 those are weak institutional levers. 0:16:56.320 --> 0:16:58.400 One thing I wanted to get your thoughts on as 0:16:58.480 --> 0:17:01.200 the way that the candidates are are leaning into media 0:17:01.600 --> 0:17:05.360 in these last two and a half close to three weeks. Yesterday, 0:17:05.760 --> 0:17:08.240 Donald Trump sat down with John mcklelthwaite, editor in chief 0:17:08.280 --> 0:17:11.720 at Bloomberg News, at the Economic Club of Chicago. Here's 0:17:11.760 --> 0:17:13.679 what he had to say about the Federal Reserve. 0:17:14.480 --> 0:17:17.800 I think it's the greatest job in government. You show 0:17:17.880 --> 0:17:20.280 up to the office once a month and you say, 0:17:20.400 --> 0:17:24.960 let's say flip a Cole, and everybody talks about you 0:17:25.080 --> 0:17:27.280 like your god, Oh, what will we do? I think 0:17:27.320 --> 0:17:31.040 that if you are a very good president with good sense, 0:17:31.800 --> 0:17:34.040 you should be able to at least talk to him. 0:17:34.160 --> 0:17:35.840 I don't say make the decision at all. 0:17:37.080 --> 0:17:39.720 There you have Donald Trump yesterday with John Nickolthwaite, the 0:17:39.840 --> 0:17:42.119 editor in chief of Bloomberg News, out there at the 0:17:42.160 --> 0:17:44.720 Economic Club of Chicago. Brad, I want to get your 0:17:44.720 --> 0:17:46.880 thoughts on this because we heard a lot from Donald 0:17:46.920 --> 0:17:50.520 Trump yesterday. You sat down with him over the summer 0:17:50.680 --> 0:17:54.040 for Bloomberg BusinessWeek cover story. Who was the Donald Trump 0:17:54.040 --> 0:17:55.600 that you saw yesterday in that interview. 0:17:55.760 --> 0:17:57.600 Well, first of all, it sounds like Donald Trump wants 0:17:57.600 --> 0:18:01.159 to be the Fed chief. He treats him so well. 0:18:02.400 --> 0:18:03.960 Look, we spoke to. 0:18:04.280 --> 0:18:09.120 Donald Trump three long months ago, before two assassination attempts, 0:18:09.119 --> 0:18:12.040 when he was still running against President Biden. He was 0:18:12.040 --> 0:18:16.760 feeling pretty good. He was more disciplined than he usually is. 0:18:16.840 --> 0:18:17.320 Back then. 0:18:17.720 --> 0:18:21.080 He was in a lot of ways introducing his economic plan. 0:18:21.400 --> 0:18:24.879 You know, some parts of that plan remain unchanged. He 0:18:25.359 --> 0:18:27.920 does differ on the details the extent of his corporate 0:18:27.920 --> 0:18:30.679 tax cut, the extent of tariffs on China and the 0:18:30.680 --> 0:18:32.720 rest of the world. A lot of the elements remain 0:18:32.800 --> 0:18:35.200 the same. You know what's different now is, in his 0:18:35.240 --> 0:18:40.080 own unique way, he's trying to expand his coalition. You know, 0:18:40.160 --> 0:18:43.040 he's there in Chicago, he was in Detroit speaking to 0:18:43.080 --> 0:18:49.120 the Economic Club there, you know, trying to, yeah, expand 0:18:49.160 --> 0:18:51.560 his support in the Midwest, where which he sees is 0:18:51.560 --> 0:18:55.360 crucial to his victory. But you know, certain things he 0:18:55.400 --> 0:18:59.399 can't change, right. He actually was very civil back in July. 0:19:00.200 --> 0:19:03.040 He really did, in a very strange way, you know, 0:19:03.160 --> 0:19:07.160 lash out to this interview or our boss yesterday. It's 0:19:08.880 --> 0:19:12.320 you know, I think again, like destabilizing or diminishing those 0:19:12.359 --> 0:19:16.800 intermediating institutions, diminishing people's trust in them, as a way 0:19:16.840 --> 0:19:17.760 to raise himself up. 0:19:17.840 --> 0:19:19.600 Brad, We're gonna have to leave it there. Bradstone the 0:19:19.680 --> 0:19:21.720 editor of Bloomberg Business Week. If you never want to 0:19:21.760 --> 0:19:24.520 miss a Bloomberg Business Week story, become a subscriber today. 0:19:24.520 --> 0:19:28.200 You'll unlock deep reporting and analysis from reporters around the world, 0:19:28.440 --> 0:19:32.000 including unlimited access to BusinessWeek. Check out our offers right 0:19:32.040 --> 0:19:35.240 now on Bloomberg dot com slash subscribe. 0:19:35.560 --> 0:19:40.560 Now you're listening to Bloomberg BusinessWeek with Carol Messer and 0:19:40.640 --> 0:19:43.879 Tim Steneveek on Bloomberg Radio and Television. 0:19:44.520 --> 0:19:47.320 It is a Bloomberg Business Week. That's Katie Greifeld in 0:19:47.359 --> 0:19:51.200 for Carol Masser on this Wednesday afternoon. I asked her 0:19:51.240 --> 0:19:54.199 before we went to break if she'd started her holiday 0:19:54.200 --> 0:19:56.760 shopping season. She said, the answer is no, Katie, it's 0:19:56.760 --> 0:19:57.320 not too early. 0:19:57.400 --> 0:19:57.560 You know. 0:19:57.640 --> 0:19:59.880 What you do, Tim, is actually you buy a gift 0:20:00.040 --> 0:20:02.360 on Amazon, like the day before you see your family. 0:20:02.400 --> 0:20:04.760 Then you print out what you bought them on Amazon, 0:20:04.800 --> 0:20:06.399 and then you give them the piece of papers. It's 0:20:06.440 --> 0:20:07.400 sort of like an IOU. 0:20:07.600 --> 0:20:10.080 It's the thought that counts, and that's a nice thought. 0:20:10.240 --> 0:20:10.560 Yeah. 0:20:10.600 --> 0:20:15.000 Absolutely, Hey, the management consulting from PwC of a couple 0:20:15.040 --> 0:20:16.800 weeks ago, they crunch the numbers. They found that even 0:20:16.840 --> 0:20:19.880 though holiday spending is projected to surge to a record high, 0:20:20.080 --> 0:20:23.360 the increase this year is less than the increase over 0:20:23.400 --> 0:20:27.600 the previous two years. So yes, it's still growing, but 0:20:27.640 --> 0:20:29.360 not growing as much as it did in recent years, 0:20:29.359 --> 0:20:33.160 according to forecasts from PwC. Let's see what Tom McGee 0:20:33.200 --> 0:20:35.080 has to say about all this. He's president and CEO 0:20:35.160 --> 0:20:38.080 of ICSC. It's formerly known as the International Council of 0:20:38.119 --> 0:20:42.080 Shopping Centers. It's the trade association. They represent retail real estate, 0:20:42.119 --> 0:20:45.640 so think shopping centers, malls and the like. Tom joins 0:20:45.720 --> 0:20:48.600 us once again from New York. Tom, good to have 0:20:48.680 --> 0:20:52.080 you with us. You are in a really interesting position 0:20:52.160 --> 0:20:55.000 because you represent the folks who have the real estate 0:20:55.240 --> 0:20:58.639 when it comes to these bricks and mortar retailers. What 0:20:58.760 --> 0:21:01.160 are you finding in the sense of how are they 0:21:01.160 --> 0:21:03.359 thinking about the upcoming holiday shopping season. 0:21:04.520 --> 0:21:06.159 Well, first of all, good afternoon, it's good to be 0:21:06.240 --> 0:21:08.840 with you again. I think we're looking at a solid 0:21:08.840 --> 0:21:11.480