WEBVTT - Bloomberg Surveillance TV: March 12th, 2026 0:00:02.360 --> 0:00:06.720 Bloomberg Audio Studios, Podcasts, radio news. 0:00:11.640 --> 0:00:15.440 This is the Bloomberg Surveillance Podcast. I'm Jonathan Ferrow, along 0:00:15.480 --> 0:00:18.680 with Lisa Bromwitz and Amrie Hordernt. Join us each day 0:00:18.720 --> 0:00:22.280 for insight from the best in markets, economics, and geopolitics 0:00:22.400 --> 0:00:24.840 from our global headquarters in New York City. We are 0:00:24.920 --> 0:00:27.680 live on Bloomberg Television weekday mornings from six to nine 0:00:27.720 --> 0:00:31.280 am Eastern. Subscribe to the podcast on Apple, Spotify or 0:00:31.320 --> 0:00:33.919 anywhere else you listen, and as always on the Bloomberg 0:00:34.000 --> 0:00:36.920 Terminal and the Bloomberg Business App. Here's the view on 0:00:36.920 --> 0:00:39.320 Wall Street this morning. Keith Lenard of truest Rant in 0:00:39.360 --> 0:00:41.519 the following, the bull market still deserves the benefit of 0:00:41.520 --> 0:00:44.680 the doubt that we expect shoppy rangebound trading to persist 0:00:45.000 --> 0:00:48.200 given the geopolitical bankdrop. Keith joins us now for more. Keith, 0:00:48.240 --> 0:00:50.680 welcome to the program. Let's just get to that calm 0:00:50.720 --> 0:00:54.080 in this secuity market. Compared to the tention elsewhere, what's 0:00:54.160 --> 0:00:55.520 anchoring the bullish view? 0:00:56.680 --> 0:01:00.480 Yeah, well for us, Good morning to yours. It's one 0:01:00.520 --> 0:01:02.320 of those years, Jonathan, and I'm glad I didn't have 0:01:02.360 --> 0:01:05.280 the headlines ahead of time writing the outlook because as 0:01:05.319 --> 0:01:07.480 you mentioned, we've had this kind of ongoing what I 0:01:07.560 --> 0:01:11.080 call the carousel of concerns. Is one concern come or receives, 0:01:11.120 --> 0:01:13.520 another one comes up, and obviously I ran as. 0:01:13.520 --> 0:01:14.279 Front and center. 0:01:14.720 --> 0:01:17.039 I think to your question, like, why is the market 0:01:17.080 --> 0:01:17.959 somewhere stable? 0:01:18.040 --> 0:01:19.640 Is you know, think about the. 0:01:19.640 --> 0:01:22.880 Last five years, everything the market has gone through, whether 0:01:22.959 --> 0:01:27.160 it's you know, COVID, supply chain disruptions, the fastest rate 0:01:27.280 --> 0:01:30.760 increased by the FED since the eighties, the highest inflation 0:01:30.920 --> 0:01:34.160 since the seventies, and despite all that, the market is 0:01:34.200 --> 0:01:36.200 still close to all time highs. And I think the 0:01:36.240 --> 0:01:39.240 north star of this full market has been earnings. Earnings 0:01:39.319 --> 0:01:43.119 at this point are still trending higher. And I think 0:01:43.200 --> 0:01:45.840 to my overall point, I think investors are giving this 0:01:45.880 --> 0:01:48.680 full market the benefit of the doubt because we've seen 0:01:48.720 --> 0:01:51.280 so many corrections, and the wrong thing to do historically 0:01:51.360 --> 0:01:55.640 during these big events at the time was ultimate to sell. 0:01:55.680 --> 0:01:58.360 So I think that's why the market is being somewhat 0:01:58.440 --> 0:02:01.320 come I'd actually like to see a little bit more 0:02:01.640 --> 0:02:04.760 patent to set up a better buying opportunity relative to 0:02:04.760 --> 0:02:05.760 where we are right now. 0:02:06.200 --> 0:02:08.800 Steve Path the federated to Hermes yesterday came on and 0:02:08.800 --> 0:02:11.680 said that when oil prices get on average above ninety 0:02:11.760 --> 0:02:14.640 dollars a barrel, that would change his constructive view because 0:02:14.639 --> 0:02:17.040 would start to do damage to the underlying economy. 0:02:17.320 --> 0:02:17.720 Do you have a. 0:02:17.680 --> 0:02:20.079 Thesis like that where suddenly you start to get more 0:02:20.080 --> 0:02:23.679 concerned about the cycle of the economy right now? 0:02:24.600 --> 0:02:27.239 Yeah, I don't know that there's an exact number, per se, 0:02:27.360 --> 0:02:28.880 but you know, we do follow a way of the 0:02:28.919 --> 0:02:29.880 evidence approach. 0:02:30.360 --> 0:02:32.320 Part of that is on the economy. 0:02:32.360 --> 0:02:36.200 So if our economic group in general starts to shave 0:02:36.280 --> 0:02:38.880 back our forecast, that would be a concern. You know, 0:02:38.919 --> 0:02:41.480 we look at relative prices, we look at the credit markets, 0:02:41.760 --> 0:02:44.760 and I think those earning trends and earnings momentum in general, 0:02:44.960 --> 0:02:48.440 all things that we're watching closely to say, hey, should 0:02:48.440 --> 0:02:50.880 we be adjusting our overall position right now? We still 0:02:51.040 --> 0:02:54.480 maintaining a modest overweight to equities. But we also wrote 0:02:54.480 --> 0:02:56.760 a note earlier this week, you know, suggesting that this 0:02:56.800 --> 0:02:59.079 is not the time we haven't had enough of a 0:02:59.200 --> 0:03:02.000 correction relative to the risk to say this is a 0:03:02.120 --> 0:03:03.880 you know, some type of buying opportunity. And you know 0:03:03.880 --> 0:03:06.800 what's also notable is look at the indexes relative you know, 0:03:07.000 --> 0:03:09.840 as Jonathan alluded to, like the Act, we our global 0:03:09.880 --> 0:03:12.000 equities are still up about a percent, the S and 0:03:12.080 --> 0:03:14.760 P's down one percent, the US dollars up one percent. 0:03:14.960 --> 0:03:16.280 So if you didn't have the headlines, you thought you 0:03:16.320 --> 0:03:16.960 would think this. 0:03:16.880 --> 0:03:19.680 Is kind of a normal, kind of uneventful year. 0:03:20.200 --> 0:03:22.640 Right now, I'm just struck by the fact that people 0:03:22.680 --> 0:03:24.600 have been conditioned to buy the dip and they have 0:03:24.600 --> 0:03:27.480 a conditioned year after year after year, partly because there 0:03:27.560 --> 0:03:31.520 is a policy response that can be delivered. Right twenty 0:03:31.680 --> 0:03:33.480 twenty we got what we got from the FED as 0:03:33.520 --> 0:03:36.640 well as the bazooka from the federal government. Twenty twenty two, 0:03:36.680 --> 0:03:38.880 there was a sense that also there was going to 0:03:38.880 --> 0:03:41.320 be some response and there was more momentum in the economy. 0:03:41.720 --> 0:03:44.400 Is there that same policy lever this time around. 0:03:44.920 --> 0:03:46.280 Yeah, it's an open question. 0:03:46.600 --> 0:03:48.520 You know, a lot of debate right now is you know, 0:03:48.560 --> 0:03:51.240 it looks like the administration may be looking for an 0:03:51.320 --> 0:03:53.400 offern but it may not be fully up to them, 0:03:53.440 --> 0:03:56.360 because I obviously the Iranians have a lot to do 0:03:56.440 --> 0:03:58.720 with this as well. But I do think big picture 0:03:59.240 --> 0:04:02.600 that you know, there is a focus from the administration 0:04:02.680 --> 0:04:04.480 and then also China you know, there's a lot of 0:04:05.520 --> 0:04:09.840 China's imports go through the Strait as well, so you know, 0:04:09.840 --> 0:04:11.520 it may not just be US, it may be China 0:04:11.560 --> 0:04:14.640 as well. So I think ultimately there is likely some 0:04:14.680 --> 0:04:17.640 type of off ramp, and that doesn't mean that some 0:04:17.680 --> 0:04:20.200 of the volatility and intentions go away. But listen, the 0:04:20.200 --> 0:04:22.760 administration is focused we all know as the midterm elections. 0:04:22.800 --> 0:04:24.320 I do think there's going to be some things they 0:04:24.360 --> 0:04:26.560 can do, but obviously it's different than the terrorists where 0:04:26.560 --> 0:04:29.719 they can basically just step away themselves as other partners 0:04:29.720 --> 0:04:30.720 that they have to rely on. 0:04:31.160 --> 0:04:33.080 But Keith, how do you parse through what the administration 0:04:33.160 --> 0:04:36.000 is saying? Yesterday the President told Axios there's practically nothing 0:04:36.080 --> 0:04:38.080 left to target and Iran, and then last night at 0:04:38.080 --> 0:04:41.080 a speech he said, we don't want to leave early, right, 0:04:41.440 --> 0:04:44.400 So the president is opening the door for a prolonged 0:04:44.480 --> 0:04:47.520 conflict to what they before they would decide that it 0:04:47.600 --> 0:04:48.800 is mission complete. 0:04:49.080 --> 0:04:51.560 Yeah, Well, the one thing I would you be thinking about. 0:04:51.640 --> 0:04:54.360 I mean, obviously, as you look at even consumer confidence 0:04:54.440 --> 0:04:58.599 serves over time and inflation expectations, they correlate very highly 0:04:58.680 --> 0:05:02.279 with gas prices. So I just think, again, no one 0:05:02.360 --> 0:05:06.159 knows exactly how long, what the pain threshold is. But ultimately, 0:05:06.600 --> 0:05:09.200 you know, high gas prices isn't going to be helpful 0:05:09.240 --> 0:05:11.240 going into a midterm election. So I think that's going 0:05:11.320 --> 0:05:13.679 to be front end center. And I mean the open 0:05:13.760 --> 0:05:15.520 question that no one can really say is does that 0:05:15.560 --> 0:05:18.960 mean the threshold is you know, two weeks, you know, 0:05:19.320 --> 0:05:19.920 two months? 0:05:19.920 --> 0:05:21.320 It's hard to say. 0:05:21.400 --> 0:05:23.920 But I think ultimately, just like there was a focus 0:05:23.960 --> 0:05:26.000 last year about hey, if a ten year treasury starts 0:05:26.040 --> 0:05:29.600 going about four fifty four seventy five, there's really a 0:05:29.600 --> 0:05:32.279 more increased focus and even more headlines that are dropping 0:05:32.400 --> 0:05:33.359 from the administration, I. 0:05:33.320 --> 0:05:35.000 Think well likely would see that as well. 0:05:35.520 --> 0:05:38.000 Again, if oil stayed elevated at these levels and we 0:05:38.000 --> 0:05:41.600 started this continue to see some of the polling data deteriorate. 0:05:41.880 --> 0:05:44.000 Keith, help me understand this one. We've had a major 0:05:44.040 --> 0:05:46.520 move and crude by more than thirty percent so far 0:05:46.800 --> 0:05:49.800 this month alone, and of repricing further out the curve 0:05:49.839 --> 0:05:52.320 as well, and yet Keith and G Equities a runbinded 0:05:52.360 --> 0:05:54.479 a more than one percent and she stucks on the 0:05:54.560 --> 0:05:57.039 s and P five hundred have barely moved off the 0:05:57.040 --> 0:05:57.800 back of this story. 0:05:57.800 --> 0:05:59.919 What gives Yeah, Well, for one thing, that. 0:06:00.320 --> 0:06:03.680 Energy stocks had a big had a big rise going 0:06:03.720 --> 0:06:05.919 into this, So I think that's one thing. I think overall, 0:06:06.080 --> 0:06:08.680 the energy market is still relatively constructive. And there's also 0:06:08.920 --> 0:06:10.880 you know, some of the cost structure within the energy 0:06:11.680 --> 0:06:13.840 complex will also go high, So there's some offices I 0:06:13.880 --> 0:06:16.960 think all of me though, you know, the energy sector 0:06:17.040 --> 0:06:21.120 on pullbacks is actually relatively attractive after not doing anything 0:06:21.120 --> 0:06:24.560 for several years. But again cutting into this whole you know, 0:06:24.600 --> 0:06:29.039 this whole tension, we saw the energy sector being among 0:06:29.080 --> 0:06:30.080 the top sectors for the. 0:06:30.120 --> 0:06:31.039 Year, and same with gold. 0:06:31.040 --> 0:06:34.839 Gold went into this being up about forty percent, you know, 0:06:34.960 --> 0:06:36.360 year to date. So I think that's just kind of 0:06:36.360 --> 0:06:38.080 the reason why we haven't seen more of these moves 0:06:38.080 --> 0:06:40.240 in both energy and gold prices per se. 0:06:40.800 --> 0:06:53.600 Stay with US Multilemberg surveillance coming up after this. Brent 0:06:53.680 --> 0:06:56.640 creag right now ninety six, Brent briefly toping one hundred 0:06:56.839 --> 0:06:58.920 after more tank is were attanked in the Persian Gulf. 0:06:58.960 --> 0:07:02.200 The IEA the war is causing the biggest ever disruption 0:07:02.520 --> 0:07:04.599 to the market as it gives up for its largest 0:07:04.760 --> 0:07:08.240 emergency release ever cohidly out of rightst energy rights, and 0:07:08.279 --> 0:07:10.040 the key variable is the duration of the war. If 0:07:10.040 --> 0:07:12.560 it lasts two months, price it could pick at one fifteen. 0:07:12.640 --> 0:07:14.480 If it goes on for four months, they could reach 0:07:14.560 --> 0:07:17.480 one thirty five. Koha joins us now for more. Oh, hey, 0:07:17.480 --> 0:07:19.960 we almost hit once Wednesday on Sunday evening a rope 0:07:19.960 --> 0:07:20.400 pad self. 0:07:20.440 --> 0:07:21.520 Now, I think so. 0:07:21.680 --> 0:07:24.200 I think it really depends on the on the duration, 0:07:24.400 --> 0:07:29.520 and at least I correctly mentioned the idea of sporting vessels. 0:07:29.600 --> 0:07:32.240 I think right now we don't see any progress there. 0:07:32.360 --> 0:07:34.320 So at the end of the day, this really comes 0:07:34.320 --> 0:07:37.120 down to mass. The straight over moves around ten million 0:07:37.120 --> 0:07:38.760 barrels per day that we think are going to be 0:07:38.800 --> 0:07:40.920 closed because of the of the of the. 0:07:41.080 --> 0:07:41.800 Of the situation. 0:07:42.680 --> 0:07:46.080 Sbr's four hundred million barrels that is not going to 0:07:46.240 --> 0:07:50.360 upset any any upside press pressure that we're seeing right now. 0:07:50.360 --> 0:07:51.920 And interestingly, when. 0:07:51.760 --> 0:07:55.720 The announcement of the four hundred million barrels was done, 0:07:55.880 --> 0:07:59.000 prices barely reacted because I think that the market already 0:07:59.120 --> 0:08:02.600 assumed that something going to happen. But last time that 0:08:02.680 --> 0:08:05.680 we saw spr's being released was in March twenty twenty 0:08:05.720 --> 0:08:08.360 two in the middle of the Russia Ukraine War. And 0:08:08.480 --> 0:08:12.520 back then when the announcement was made. Prices failed by 0:08:12.600 --> 0:08:15.400 five dollars per viral right now they didn't. And this 0:08:15.680 --> 0:08:19.000 really shows how important, how critical the situation is at 0:08:19.040 --> 0:08:19.360 the moment. 0:08:19.440 --> 0:08:22.320 Oh, hey, we've seying production bank cup, You've seeing certain 0:08:22.360 --> 0:08:25.960 shot sains taking place in certain places. Restarting from there 0:08:26.480 --> 0:08:29.120 isn't necessarily painless, And I wonder from your perspective, what 0:08:29.200 --> 0:08:32.560 kind of damage we're already doing to supply chains. 0:08:32.960 --> 0:08:35.559 That's the key supply chain. I mean, you really hit 0:08:35.600 --> 0:08:39.040 the supply chain. And more importantly, from the geology point 0:08:39.040 --> 0:08:41.880 of view, the moment that you shut in production, you 0:08:42.000 --> 0:08:44.920 are changing the pressure of the reservoir and that could 0:08:45.080 --> 0:08:50.120 potentially damage your reservoir forever. So we think that coming 0:08:50.160 --> 0:08:53.079 back to to you know, normal production states, state production 0:08:53.440 --> 0:08:55.960 is not a matter of days, is essentially a matter 0:08:56.160 --> 0:08:57.600 of weeks, if not months. 0:08:57.600 --> 0:09:00.360 So yes, the straight Orf almost could be reopened tomorrow. 0:09:00.960 --> 0:09:03.760 It will take a few weeks to clear up all 0:09:03.800 --> 0:09:07.160 the logistic backlock. But then you also have the problem 0:09:07.240 --> 0:09:11.000 of rumping up production again. In some countries, especially Iraq, 0:09:11.200 --> 0:09:13.480 might have severe problems doing that. 0:09:14.000 --> 0:09:15.040 In response to higher. 0:09:14.840 --> 0:09:16.599 Oil prices, You've seen a lot of flights that have 0:09:16.760 --> 0:09:20.080 neither canceled, the prices of the tickets go up substantially. 0:09:20.360 --> 0:09:24.199 You've seen mandates to use either car pooling or bike 0:09:24.280 --> 0:09:27.240 to work in certain places, particularly in Southeast Asia. How 0:09:27.320 --> 0:09:30.120 much demand destruction have you already started to see a merge? 0:09:30.920 --> 0:09:31.560 Excellent point. 0:09:31.600 --> 0:09:33.160 I think that the man destruction is one of the 0:09:33.200 --> 0:09:36.200 important leavers that how the market is going to react. 0:09:36.360 --> 0:09:39.719 We've seen during March to start the conflict, around one 0:09:39.720 --> 0:09:42.000 point four million barrels per day of the man destruction. 0:09:42.200 --> 0:09:44.160 That is quite quite significant. 0:09:44.240 --> 0:09:47.679 One point four million barrels per day initially aviation and 0:09:47.760 --> 0:09:50.960 now gradually that impact is going to be translated into 0:09:51.440 --> 0:09:55.240 transport fuels and heating oil. And if the conflict lasts 0:09:55.240 --> 0:09:58.200 for longer, then we are probably going to see a 0:09:58.240 --> 0:10:02.760 refueling of inflation, which could change the attitude of central 0:10:02.800 --> 0:10:05.240 banks around the world. To give you a data point, 0:10:05.480 --> 0:10:07.960 before the war, we thought that oil demand was going 0:10:08.000 --> 0:10:10.800 to grow by one million barrels per day. Even the 0:10:10.840 --> 0:10:14.600 war extends for around four months, let's say oil demand 0:10:14.720 --> 0:10:17.920 growth is cut down to just four hundred thousand barrels 0:10:17.960 --> 0:10:18.280 per day. 0:10:18.320 --> 0:10:20.400 So that's really showing you. 0:10:20.400 --> 0:10:24.160 How important the demand destruction could be in the coming 0:10:24.240 --> 0:10:24.920 days and weeks. 0:10:25.120 --> 0:10:27.959 One of the other leavers Orge is more production from 0:10:27.960 --> 0:10:30.160 other areas that aren't as affected, like Russia. Do you 0:10:30.160 --> 0:10:32.680 have a sense of how much more Russia is earning 0:10:32.760 --> 0:10:34.800 as a result of higher energy prices, in the fact 0:10:34.840 --> 0:10:37.440 that it's actually increasing production to help meet the needs 0:10:37.480 --> 0:10:39.680 of its allies like China. 0:10:40.960 --> 0:10:45.080 Sure, we've seen the waivers that India received to continue 0:10:45.120 --> 0:10:49.680 inputting Russian could. Before the sanctions, Russia was exported around 0:10:49.720 --> 0:10:52.880 one point six million barrels per day to India. Then 0:10:53.400 --> 0:10:55.840 last numbers before the war was around eight hundred thousand 0:10:55.880 --> 0:10:59.199 barrels per day, so quite a significant decrease, and. 0:10:59.240 --> 0:11:01.240 With the waivers, think that there's a little bit of. 0:11:01.160 --> 0:11:04.800 An upside potential around one point two medium barrels per day. 0:11:04.840 --> 0:11:08.040 But importantly, there's a lot of Russian oil right now 0:11:08.120 --> 0:11:12.200 in offshore storage. So the fact that India is going 0:11:12.240 --> 0:11:15.760 to be able to increase its purchases of Russian could 0:11:16.000 --> 0:11:19.800 does not directly mean that Russia could start bumping up more. 0:11:19.880 --> 0:11:22.800 I think what it means is that the offshore storage 0:11:22.880 --> 0:11:26.200 will be gradually clear up and going forward, we think 0:11:26.200 --> 0:11:29.840 that the upside potential for Russia is actually quite limited. 0:11:29.880 --> 0:11:32.480 No more than two hundred three hundred thousand barrals per day. 0:11:32.600 --> 0:11:36.000 Apart from that, you don't really have much reaction in 0:11:36.040 --> 0:11:39.120 the very short term. Yes, shale can react, but that 0:11:39.280 --> 0:11:41.320 is something towards the end of the year and again 0:11:41.440 --> 0:11:42.040 very limited. 0:11:42.160 --> 0:11:44.480 I don't think more than three hundred thousand barrels per day. 0:11:44.760 --> 0:11:46.760 There was a report even just this morning about Indian 0:11:46.840 --> 0:11:49.800 oil purposes from Russia increase by nearly forty five percent 0:11:50.360 --> 0:11:53.160 in March. So basically, does Russia just get back their 0:11:53.480 --> 0:11:56.679 entire export capacity that they had in India before the 0:11:56.800 --> 0:11:58.560 United States started putting pressure on your. 0:11:58.480 --> 0:12:02.439 DELI probably yes. Now the big question there is what 0:12:02.520 --> 0:12:06.080 happens when the war ends. Will those waivers expire at 0:12:06.080 --> 0:12:08.320 among those waivers are supposed to expire at the end 0:12:08.360 --> 0:12:12.439 of April. Now, when the war ends, will those sanctions 0:12:12.480 --> 0:12:16.360 be put back into place or not? And my hunch 0:12:16.400 --> 0:12:19.720 here is that once you lift the waivers, once you 0:12:19.800 --> 0:12:23.000 lift the sanctions, it is pretty difficult to go back 0:12:23.000 --> 0:12:24.160 and implement in them again. 0:12:24.800 --> 0:12:28.480 I remember when the Red Sea was shot basically for months, 0:12:28.480 --> 0:12:30.640 and tankers and cargo ships didn't want to go through 0:12:30.640 --> 0:12:32.160 it because it was going on with the who thies 0:12:32.520 --> 0:12:35.320 even if the United States Jorge is able to reopen 0:12:35.320 --> 0:12:37.800 the Strait of Hormuz, when we'll go back to quote 0:12:37.840 --> 0:12:39.359 unquote normal. 0:12:40.600 --> 0:12:44.560 That's the key variable here. I don't think that, first 0:12:44.559 --> 0:12:46.800 of all, the scenario of the US is coating vessels. 0:12:47.080 --> 0:12:50.319 We don't see appetite from shipping companies to take that 0:12:50.880 --> 0:12:54.120 option at all right now. The mechanism is still not 0:12:54.240 --> 0:12:56.199 in place, and we don't think that this. 0:12:56.240 --> 0:12:57.720 Is likely to happen anytime soon. 0:12:57.960 --> 0:13:00.240 So to me, the only way forward for this street 0:13:00.240 --> 0:13:03.520 door foremost to be reopened east through two channels, regime 0:13:03.640 --> 0:13:06.480 chinch which at the moment doesn't seem very visible, and 0:13:06.520 --> 0:13:08.160 the other one needs to through US fire. 0:13:08.800 --> 0:13:12.319 Stay with US. More Bloomberg surveillance coming up after this. 0:13:21.559 --> 0:13:23.920 So here's the lass this morning. Crude climbing even as 0:13:23.960 --> 0:13:26.760 President Trump vows the lower prices with a massive release 0:13:26.960 --> 0:13:30.199 from the US Strategic Petroleum Reserve. Lebby cancel a PIMCO 0:13:30.320 --> 0:13:32.560 with this to say, the longer this conflict plays out, 0:13:32.559 --> 0:13:35.960 the more ugly the political environment may become. Lebby John's 0:13:36.040 --> 0:13:37.640 surround the table, let me good morning, it's going to 0:13:37.679 --> 0:13:39.760 see you. What do you make of the policy response 0:13:39.800 --> 0:13:41.480 so far? Yeah, so I think. 0:13:41.640 --> 0:13:44.599 I mean, the expectation was that there would be a 0:13:44.679 --> 0:13:47.120 dramatic release from the strategy petroleum reserve, and of course 0:13:47.120 --> 0:13:49.240 that's what we have seen. I do think that, as 0:13:49.240 --> 0:13:52.240 your previous guests have pointed out, that is only so effective. 0:13:53.200 --> 0:13:56.880 In terms of other tools, the president is pretty limited. 0:13:57.480 --> 0:13:59.960 There are obviously Russian sanctions that he can tweak with 0:14:00.160 --> 0:14:03.920 a little bit of that last week export controls that's 0:14:03.960 --> 0:14:09.320 really an extreme, some modifications or exemptions to the Jones Act. 0:14:09.679 --> 0:14:11.560 But outside of this is sort of all nibbling around 0:14:11.559 --> 0:14:16.720 the edges in terms of really addressing the what it 0:14:16.760 --> 0:14:20.000 looks like maybe one hundred dollars oil and of course 0:14:20.080 --> 0:14:23.720 then the price of gas, which is really the issue politically, domestically. 0:14:23.760 --> 0:14:27.320 And this is exactly the opposite of what Republicans plan 0:14:27.560 --> 0:14:29.040 was for twenty twenty six. It was going to be 0:14:29.080 --> 0:14:32.040 all about affordability. It was going to be pushing their agenda, 0:14:32.160 --> 0:14:34.120 even if maybe they weren't able to get things done, 0:14:34.200 --> 0:14:36.920 they were going to be at least rhetorically talking about it. 0:14:37.240 --> 0:14:40.680 And now that's been completely kind of undermined by this. 0:14:40.960 --> 0:14:42.840 We came into the new year with the White House 0:14:42.960 --> 0:14:47.080 squarely focused on affordability. How do they change their message 0:14:47.200 --> 0:14:49.640 now going into the summer and going to the midterms 0:14:49.640 --> 0:14:52.240 where it's clear the House likely is going to flip. 0:14:52.600 --> 0:14:54.640 But I'm talking to people who think that there is 0:14:54.680 --> 0:14:56.360 a chance Republicans lose the Senate. 0:14:57.640 --> 0:14:59.880 Yeah, So, I mean again, I think this is sort 0:14:59.880 --> 0:15:03.160 of their their sort of best laid plans here, have 0:15:03.360 --> 0:15:05.720 you know, gone a bit of rye. I mean, I 0:15:05.760 --> 0:15:08.000 think what the hope is is that this is going 0:15:08.040 --> 0:15:10.880 to be able to be finished right going into the 0:15:10.920 --> 0:15:13.680 summer months now. Of course, I mean it's it sounds 0:15:13.680 --> 0:15:16.400 sort of flippid, but you know, wars or conflicts are 0:15:16.440 --> 0:15:20.280 easy to start, much much harder to finish, particularly given 0:15:20.320 --> 0:15:23.240 the complexity of this of this region. So you know 0:15:23.320 --> 0:15:26.040 that intention, of course, may not be realized. I do 0:15:26.080 --> 0:15:28.160 think though, just you know, again, you saw a little 0:15:28.160 --> 0:15:30.960 bit of this yesterday with President Trump trying to get 0:15:31.000 --> 0:15:35.440 back onto that sort of affordability you know mantle. But again, 0:15:35.480 --> 0:15:38.040 I mean people you know, voters are are or not 0:15:38.680 --> 0:15:41.840 I'm not stupid, right, they see what's happening. The price 0:15:41.880 --> 0:15:44.040 of the p I just can't reinforce this enough because 0:15:44.040 --> 0:15:46.040 if you go back to spring of twenty twenty two, 0:15:46.360 --> 0:15:48.840 and you had, you know, almost five dollars oil June 0:15:48.880 --> 0:15:52.960 of twenty twenty two. The president's approval reading President Biden 0:15:53.000 --> 0:15:54.400 at that point, I mean, it took a huge hit. 0:15:54.480 --> 0:15:56.920 And they're basically inversely correlated. If you look at the 0:15:57.160 --> 0:16:00.000 graph of a presidential approval rating versus the price of gas, 0:16:00.280 --> 0:16:02.920 these things, you know, gas and groceries. People really care 0:16:03.440 --> 0:16:06.440 about these kitchen table issues, and so you know, people 0:16:06.480 --> 0:16:08.600 may not be paying attention to exactly what's happening from 0:16:08.640 --> 0:16:10.960 a foreign policy perspective and in terms of some maybe 0:16:11.000 --> 0:16:14.040 the wins that the US may ultimately achieve, but they 0:16:14.080 --> 0:16:15.960 really do care about the price of the pump. And 0:16:15.960 --> 0:16:17.720 this is going to be a big, a big headwind 0:16:17.720 --> 0:16:18.160 going into the. 0:16:18.200 --> 0:16:21.520 And Biden was then forced to abandon another foreign policy priority, 0:16:21.560 --> 0:16:23.880 which was to make Saudi Arabia or Muhammed ben Salmon 0:16:23.960 --> 0:16:27.280 a Priya, and he actually went to Jetta. When it 0:16:27.320 --> 0:16:29.440 comes to potentially what the US is going to have 0:16:29.480 --> 0:16:30.680 to or the Ministration is going to have to have 0:16:30.720 --> 0:16:34.000 Congress for is their appetite for more or defense spending 0:16:34.160 --> 0:16:35.160 going to the maternal This. 0:16:35.120 --> 0:16:37.120 Is going to be a very difficult vote, I think, 0:16:37.280 --> 0:16:38.920 I mean that what it looks like is that the 0:16:38.920 --> 0:16:41.880 White House is preparing what's called the supplemental package. You know, 0:16:42.000 --> 0:16:44.840 could be fifty billion dollars, could be more. Honestly, just 0:16:44.880 --> 0:16:48.360 given sort of the pace of spending and the extent 0:16:48.400 --> 0:16:51.680 of the conflict, they will probably you know, as Anne Marinos, 0:16:51.680 --> 0:16:54.120 they usually like to add sweeteners in order to get 0:16:54.160 --> 0:16:55.040 that sixty votes. 0:16:55.040 --> 0:16:55.640 That's what they need. 0:16:55.680 --> 0:16:58.200 In the Senate, Republicans only have fifty three votes right now, 0:16:58.240 --> 0:17:01.560 so you kind of by definition you need eight Democrats 0:17:01.560 --> 0:17:04.280 because Paul will probably vote against it. It will be a 0:17:04.400 --> 0:17:07.800 very difficult vote, and it just means that more deficit spending, 0:17:07.960 --> 0:17:10.520 right it means that we could see a supplemental and 0:17:10.560 --> 0:17:13.080 sort of the one hundred billion dollar range, you know, potentially. 0:17:13.400 --> 0:17:15.280 So I think it's going to be a very very 0:17:15.720 --> 0:17:18.439 tricky vote, you know. I think going back though to 0:17:18.680 --> 0:17:20.840 your excellent point though about the Senate, and this is 0:17:20.840 --> 0:17:24.040 something we've been looking at. Two big indicators going into 0:17:24.080 --> 0:17:27.119 the midterm elections that sort of have correlated with previous 0:17:27.119 --> 0:17:29.320 election outcomes. One is just called the generic ballot, sort 0:17:29.320 --> 0:17:31.879 of the general view of one party over another, and 0:17:31.920 --> 0:17:35.640 the other's an enthusiasm gap. How enthusiastic are one set 0:17:35.640 --> 0:17:39.119 of voters over another, and you know, the generic ballot, 0:17:39.200 --> 0:17:41.399 it's sort of plus five for Democrats. That's sort of 0:17:41.480 --> 0:17:44.720 like pointy to a fine night. Probably the House flipping, 0:17:45.119 --> 0:17:48.800 but Republicans keeping the Senate. The enthusiasm gap, however, that 0:17:48.880 --> 0:17:51.280 is suggesting a wave of election, and so that is 0:17:51.280 --> 0:17:54.040 just those are just two variables to sort of look 0:17:54.080 --> 0:17:56.720 at as we go into the midterm election. But to 0:17:56.800 --> 0:17:59.360 your point, I think that the conventional wisdom Republicans would 0:17:59.440 --> 0:18:01.800 keep the Senate because of that challenging map. For Democrats 0:18:02.040 --> 0:18:04.959 that could be thrown out the window again the longer 0:18:05.000 --> 0:18:05.680 this persists. 0:18:05.760 --> 0:18:07.480 The Iron War has definitely taken a lot of the 0:18:07.560 --> 0:18:12.439 energy of everyone's agendas recently, but the government's still impartial shutdown, 0:18:12.480 --> 0:18:13.800 and if you want to travel, not only is it 0:18:13.840 --> 0:18:15.960 going to cost you more because of higher oil prices, 0:18:15.960 --> 0:18:18.320 but also the lines are going to take you potentially 0:18:18.320 --> 0:18:21.760 substantially longer because TSA agents are not showing up. 0:18:21.920 --> 0:18:23.160 What are they going to get reopened? 0:18:23.880 --> 0:18:26.359 Yeah, I mean, this is I think fault on both sides, honestly, 0:18:26.400 --> 0:18:29.359 and Republicans and Democrats you can probably say that about 0:18:29.359 --> 0:18:30.240 a lot on Washington. 0:18:30.280 --> 0:18:32.040 These days, you. 0:18:32.000 --> 0:18:35.040 Know, and again, the people's view of Congress just in general, 0:18:35.240 --> 0:18:38.600 it's like at you know, all time lows, and this 0:18:38.680 --> 0:18:40.240 is just going to make them more angry, right, I 0:18:40.240 --> 0:18:41.879 mean this again, and this is just if you the 0:18:41.920 --> 0:18:45.200 way to sort of disenfranchise voters is to like make 0:18:45.320 --> 0:18:48.760 things that used to be more convenient less convenient. So again, 0:18:48.960 --> 0:18:51.560 price of the price of gas, now if you can afford, 0:18:51.840 --> 0:18:53.960