WEBVTT - Bloomberg Surveillance TV: March 18th, 2026

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<v Speaker 1>Bloomberg Audio Studios, Podcasts, radio News.

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<v Speaker 2>This is the Bloomberg Surveillance Podcast. I'm Jonathan Ferrow, along

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<v Speaker 2>with Lisa Bromwitz and Amrie Hordernt. Join us each day

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<v Speaker 2>for insight from the best in markets, economics, and geopolitics

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<v Speaker 2>from our global headquarters in New York City. We are

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<v Speaker 2>live on Bloomberg Television weekday mornings from six to nine

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<v Speaker 2>am Eastern. Subscribe to the podcast on Apple, Spotify or

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<v Speaker 2>anywhere else you listen, and as always on the Bloomberg

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<v Speaker 2>Terminal and the Bloomberg Business App. Dan Pickering of Pickering

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<v Speaker 2>Energy Partners writing, if the US just stops, then Iran

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<v Speaker 2>holds the keys to chaos by threatening future straight shutdowns.

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<v Speaker 2>This would create a perpetual risk premium on oil prices.

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<v Speaker 2>Dan joins us now for more, Dan, welcome to the program.

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<v Speaker 2>Let's build on that last line. It's important. Do you

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<v Speaker 2>think this is regime change for the price accrude.

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<v Speaker 3>It's certainly putting a lower floor in on crude.

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<v Speaker 4>And it really does depend, as and Maria is.

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<v Speaker 3>Saying, it depends on things that are very difficult to

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<v Speaker 3>understand and predict. And so if we end the war

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<v Speaker 3>in Iran, without some sort of definitive action that controls

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<v Speaker 3>the straits of horror moves, there's going to be a

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<v Speaker 3>higher price to crew.

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<v Speaker 4>Is it going to be triple digits?

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<v Speaker 3>Not necessarily, but it will certainly not go as long

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<v Speaker 3>as it's been recently.

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<v Speaker 2>And we've watched the domino's fall over the past two

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<v Speaker 2>weeks as the energy couldn't move through the straighter for

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<v Speaker 2>most production start at being come and now we're in

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<v Speaker 2>a different phase. They're finding workarounds. First there was the pipeline,

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<v Speaker 2>the East West pipeline in Saudi Arabia, and now there's

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<v Speaker 2>other workarounds too. What face are we in at the moment?

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<v Speaker 3>Yeah, as the market titans, everyone looks for alternatives. Sooner

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<v Speaker 3>or later, you can't tweak around the margin, and the

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<v Speaker 3>problem remains. Fifteen percent of global supply is offline. You

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<v Speaker 3>draw down inventories, you try to reroute pipelines, but that's

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<v Speaker 3>just too much oil to work around. And so at

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<v Speaker 3>some point point, and that point is is months, not quarters.

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<v Speaker 3>At some point price is going to have to solve

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<v Speaker 3>the supply demand equation, and that price isn't isn't where

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<v Speaker 3>we're at today with WTI near one hundred, it's going

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<v Speaker 3>to be twenty or thirty percent higher.

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<v Speaker 1>So what is.

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<v Speaker 5>The oil market right now pricing in given the fact

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<v Speaker 5>that there is a high likelihood that this conflict is

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<v Speaker 5>going to go on for at least another couple of weeks.

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<v Speaker 3>Yeah, I think in a couple of weeks, I stop

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<v Speaker 3>looking at the front month or the near term spot

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<v Speaker 3>prices because those are wildly volatile and move with newsflow.

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<v Speaker 3>I look out to the twenty twenty seven and twenty

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<v Speaker 3>twenty eight crude futures, which have moved from call it

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<v Speaker 3>sixty dollars a barrel WTI up into the sort of

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<v Speaker 3>high sixties, low seventies. That tells me that the market's decided.

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<v Speaker 3>There's five to ten dollars longer term premium that's coming

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<v Speaker 3>in because of potentially how this situation winds up.

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<v Speaker 1>There are two.

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<v Speaker 5>Schools of thought dan On one hand, some people say

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<v Speaker 5>there will be a longer, high, long term price simply

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<v Speaker 5>because it'll be hoarding and a premium on some of

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<v Speaker 5>these physical goods. Other people say that if the short

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<v Speaker 5>term situation of the short term conflict does get worse,

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<v Speaker 5>escalates and creates really high energy prices that actually on

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<v Speaker 5>drive prices down incredibly low on the back end of

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<v Speaker 5>this conflict. Where do you stand on that?

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<v Speaker 3>Yeah, the issue of the higher it goes, the more

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<v Speaker 3>demand destruction you have, the longer it takes to recover

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<v Speaker 3>from that. So the higher it goes potentially the lower

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<v Speaker 3>it falls. Where I stand on this is that it

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<v Speaker 3>is all about the duration.

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<v Speaker 4>If the straits are closed for six.

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<v Speaker 3>Months, we're going to have one hundred and twenty five

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<v Speaker 3>dollars oil for quite a period of time. We're going

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<v Speaker 3>to have economic issues, probably a recession. If we solve

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<v Speaker 3>this in the next couple of weeks, we probably come

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<v Speaker 3>back down to the seventies, Gasoline prices come back down

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<v Speaker 3>to reasonable levels, and we're sort of back to a

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<v Speaker 3>new normal where gasoline and oil are a little bit

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<v Speaker 3>more expensive, but not dramatically more expensive.

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<v Speaker 6>Dan, what's the gap right now between the physical market

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<v Speaker 6>and the futures market, Because I'm looking at Oman and

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<v Speaker 6>Dubai crude and they're fifty five sixty dollars higher than

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<v Speaker 6>we're brent Is trading.

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<v Speaker 3>Yeah, if you have to own the physical barrels, you

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<v Speaker 3>are paying a significant premium over the financial markets to

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<v Speaker 3>get them. I think the financial markets ten times bigger

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<v Speaker 3>than the physical markets. So financial markets pricing where you

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<v Speaker 3>can trade paper barrels, if you are trying to get

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<v Speaker 3>a barrel in the Middle East, you're paying more. Same

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<v Speaker 3>story with jet fuel and other products. So there are

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<v Speaker 3>signs of physical supply tightness that is not being reflected

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<v Speaker 3>in the financial markets. That has happened historically as well,

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<v Speaker 3>so it's not unusual, but it does say that the

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<v Speaker 3>physical market quite tight.

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<v Speaker 6>If we have a prolonged shut or the Iranians continue

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<v Speaker 6>to control and not allow most vessels to go through

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<v Speaker 6>the Strait of Hormuz for a prolonged period of time,

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<v Speaker 6>well the physical market or the future market rather catch

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<v Speaker 6>up to the physical market.

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<v Speaker 3>It'll certainly, it'll certainly drag the financial markets higher. You're

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<v Speaker 3>right now, you're pricing out demand in isolated instances with

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<v Speaker 3>that one hundred and fifty dollars crew in the Middle East,

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<v Speaker 3>for instance.

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<v Speaker 4>On the physical market.

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<v Speaker 3>The financial market's going to move up to the same

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<v Speaker 3>spot and pull basically prices worldwide that direction. And if

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<v Speaker 3>that happens, then we will start to see, you know,

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<v Speaker 3>we will price out the five, ten, fifteen million barrels

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<v Speaker 3>a day that we are not able to get through

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<v Speaker 3>the straits.

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<v Speaker 2>Then what would happen if Iron turned around and said

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<v Speaker 2>any vessel with a Chinese flag on top can come through,

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<v Speaker 2>no problem with that changes things materially.

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<v Speaker 3>I think what we'd see is we'd see a lot

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<v Speaker 3>of Chinese flag vessels moving through the Straits, and I

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<v Speaker 3>mean the market suffision will move quickly to have China

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<v Speaker 3>be the source of shipping through the Straits.

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<v Speaker 4>But I do think we'd see near term prices drop.

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<v Speaker 3>And I'm a believer that when this conflict in regardless

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<v Speaker 3>of how it ends, near term prices come down.

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<v Speaker 4>Because more oil will flow.

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<v Speaker 3>So, whether it's Chinese tankers, a US flotilla, protection, regime change, etc.

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<v Speaker 3>However it ends, prices come down, more oil through the straits,

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<v Speaker 3>prices come down.

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<v Speaker 4>The question is come down to what.

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<v Speaker 2>Well, Dan, this is what I'm trying to work out though,

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<v Speaker 2>where's the pressure point and who holds the case. And

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<v Speaker 2>ultimately it feels like the pressure point is going to

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<v Speaker 2>be in China. It's not going to be here in

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<v Speaker 2>the United States. And they hold the case they can

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<v Speaker 2>get the Iranians to come around. Now, am I reading

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<v Speaker 2>it wrong or other people reading it wrong? Isra path

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<v Speaker 2>there to reopen things.

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<v Speaker 3>Yeah, so China and India both approached to Iran and said,

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<v Speaker 3>let us take tankers through the straits. That's another gambit

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<v Speaker 3>in the strategy. The question is how long does that

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<v Speaker 3>last or does the US allow that?

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<v Speaker 4>Ultimately?

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<v Speaker 3>Are you going to feel comfortable with Iran in charge

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<v Speaker 3>of the straits and allowing some vessels to come.

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<v Speaker 4>Through but not all?

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<v Speaker 3>Do we wind up with this uncertainty premium that creeps

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<v Speaker 3>into the market even if barrels do start to flow

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<v Speaker 3>to Asia.

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<v Speaker 2>Stay with us. More Bloomberg Surveillance coming up after this.

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<v Speaker 1>It's the latest.

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<v Speaker 2>This morning, the Federal Reserve said to deliver a rate

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<v Speaker 2>decision and new set of projections while facing triple digit

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<v Speaker 2>crude prices. Neil Data of Rnmack writing, we're on track

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<v Speaker 2>for three poor core inflation prints in a row ahead

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<v Speaker 2>of a shock to oil markets. I think it's more

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<v Speaker 2>likely that a cut is are raised altogether. Neil joins

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<v Speaker 2>us Now for more, Neil welcome, was looking forward to this,

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<v Speaker 2>So let's go from the top two pm Eastern time

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<v Speaker 2>projections drop.

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<v Speaker 1>What changes?

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<v Speaker 7>Well, I mean, I don't think that the feder will

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<v Speaker 7>be as dubbish as they have been if you judge

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<v Speaker 7>it based on the summary of economic projections. I mean,

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<v Speaker 7>if you just think about this in terms of mark

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<v Speaker 7>to market and you're a forecaster, it's more obvious that

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<v Speaker 7>they need to revise up their core forecast. I mean

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<v Speaker 7>core PCE is basically tracking above three percent as of

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<v Speaker 7>this meeting, and they expect it to go to two

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<v Speaker 7>and a half percent by the end of the year.

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<v Speaker 7>In order to hit that bogie, you basically need core

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<v Speaker 7>inflation prints I think around two tenths of a percent

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<v Speaker 7>for the rest of the year. That's a pretty pretty

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<v Speaker 7>tall order all things considered. I mean, we haven't even

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<v Speaker 7>seen the flow through of energy into core inflation, and

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<v Speaker 7>some of that will bleed it. Not a lot, but

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<v Speaker 7>that's going to happen. And so you know, if you're

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<v Speaker 7>looking at this objectively, I think you just have to

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<v Speaker 7>say it's much more likely that they'll be revising up

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<v Speaker 7>core PC inflation. It could be as much as three

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<v Speaker 7>tenths then revising up the unemployment rate estimate, which basically

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<v Speaker 7>stays at four point four percent. So you put that

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<v Speaker 7>into a simple tailor rule model, John, and you know,

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<v Speaker 7>I think thirty basis points higher on CORNFLA. That's probably

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<v Speaker 7>good for enough of them to take a rate cut

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<v Speaker 7>off the table.

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<v Speaker 5>No, you've been pounding the table about the labor market

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<v Speaker 5>and saying that it is much weaker than people are

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<v Speaker 5>currently giving it credit for, or lacking the credit of.

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<v Speaker 5>I'm just wondering, what do you think the consequence of

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<v Speaker 5>a FED remaining on hold is for the economy.

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<v Speaker 4>Well, it's not good.

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<v Speaker 1>It's not good.

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<v Speaker 7>I mean, it reinforces the downside risk of the job market.

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<v Speaker 7>You know, ultimately, if the unemployment rate is going up

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<v Speaker 7>and the FED isn't easing and you know, providing some

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<v Speaker 7>kind of shock absorber to that, it just reinforces the

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<v Speaker 7>upside risk to the unemployment rate.

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<v Speaker 5>Do you think that it increases chance of recession this year,

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<v Speaker 5>which ultimately no one is really pricing in.

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<v Speaker 7>Yeah, I mean I think that the risk of recession

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<v Speaker 7>is higher than the markets believe. Of course, I've said

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<v Speaker 7>that for some time now. But you know, look, at

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<v Speaker 7>the end of the day, the economy is not in

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<v Speaker 7>the same place it was in twenty twenty two, which

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<v Speaker 7>is why drawing parallels to that period I think are misplaced.

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<v Speaker 7>I mean, back then, the labor markets are wrong. Real

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<v Speaker 7>incomes were rising today, that's not the case. Real incomes,

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<v Speaker 7>not of transfers, are running basically half of a percent

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<v Speaker 7>over the last year. And that was true even before

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<v Speaker 7>this latest inflation shot. Of course, back then, we had

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<v Speaker 7>a massive pile of excess savings that consumers were able

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<v Speaker 7>to draw down. Again, that's not the case today. The

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<v Speaker 7>savings rate, if anything, has already been drawn down. I mean,

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<v Speaker 7>that's one of the reasons why consumer spending has been

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<v Speaker 7>as strong as it has been over the last twelve

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<v Speaker 7>months or so. And even then, consumption has been slowing

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<v Speaker 7>despite that drawdown in savings. So I think that the

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<v Speaker 7>consumer here is on, you know, not as strong footing

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<v Speaker 7>as was the case a few years ago. And you know,

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<v Speaker 7>it's encouraging to see oil prices moderate somewhat today, but

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<v Speaker 7>ultimately we're on a glidepath nationally to four dollars a

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<v Speaker 7>gallon gasoline. I mean, that's that's likely to happen at

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<v Speaker 7>some point next week or two. So that provides some

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<v Speaker 7>sticker shock, I think to consumers. And you know, one

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<v Speaker 7>thing we're not talking about, we're not talking about tax

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<v Speaker 7>refunds anymore. So a lot of the enthusiasm that people

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<v Speaker 7>had going into the year, I think has been effectively

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<v Speaker 7>neutered as a result of this.

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<v Speaker 6>Well, Neil, in some states we're ready above four. In

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<v Speaker 6>the president's own Florida, we're at three ninety three when

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<v Speaker 6>it comes to a gallon of gasoline. You said going

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<v Speaker 6>into the weekend, the two core pillars of trumpnomics are

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<v Speaker 6>rising equity prices and low energy prices. Are we at

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<v Speaker 6>risk of losing both of these at this moment?

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<v Speaker 7>Well, I mean I think we're losing the f I

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<v Speaker 7>mean for households.

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<v Speaker 1>Of course.

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<v Speaker 7>The main issue is that, you know, even though America

0:11:42.640 --> 0:11:46.640
<v Speaker 7>is a large energy producer, now the money doesn't recycle

0:11:46.679 --> 0:11:51.199
<v Speaker 7>back into the economy quickly, so consumers will spend less

0:11:51.240 --> 0:11:53.360
<v Speaker 7>than oil producers will spend more, at least in the

0:11:53.400 --> 0:11:55.480
<v Speaker 7>short run. So I think that's something that people need

0:11:55.520 --> 0:11:59.400
<v Speaker 7>to think about here, is that, you know, the sort

0:11:59.400 --> 0:12:01.760
<v Speaker 7>of the els city of the spending. It's not like

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<v Speaker 7>oil producers are going to take their new found income

0:12:05.080 --> 0:12:08.199
<v Speaker 7>windfall and go out and spend it in a bunch

0:12:08.240 --> 0:12:09.160
<v Speaker 7>of mining rigs.

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<v Speaker 4>I mean, in fact, to.

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<v Speaker 7>The extent that people are saying this is going to

0:12:12.040 --> 0:12:14.880
<v Speaker 7>be transitory, they may be less inclined to do that.

0:12:14.920 --> 0:12:17.320
<v Speaker 7>So I think the growth shock is actually that much

0:12:17.320 --> 0:12:20.319
<v Speaker 7>more material, at least upfront. But with respect to equities,

0:12:22.160 --> 0:12:24.040
<v Speaker 7>you know, look, equities are hanging in there. I mean,

0:12:24.040 --> 0:12:29.280
<v Speaker 7>there's some there was probably some anxiety before all this.

0:12:30.559 --> 0:12:32.480
<v Speaker 7>So even if you get a quick resolution to this,

0:12:32.600 --> 0:12:34.440
<v Speaker 7>I mean, I don't think we're sort of like raging

0:12:34.480 --> 0:12:37.600
<v Speaker 7>back to new highs. But for now, I mean, the

0:12:37.600 --> 0:12:40.600
<v Speaker 7>stock market is you know, for lack of a better phrase,

0:12:40.640 --> 0:12:41.960
<v Speaker 7>trusting in Trump.

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<v Speaker 2>Stay with us. More Bloomberg surveillance coming up after this.

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<v Speaker 2>Here's the latest this morning, Israel claiming the elimination of

0:12:58.480 --> 0:13:01.400
<v Speaker 2>another top a round in a fish, the US ramping

0:13:01.440 --> 0:13:04.079
<v Speaker 2>up efforts to reopen the strata for most, dropping five

0:13:04.160 --> 0:13:08.120
<v Speaker 2>thousand pounds bunker busters on Iranian missile sites. Seth Jones

0:13:08.280 --> 0:13:11.599
<v Speaker 2>csis with this to say, writing, the brutal truth is

0:13:11.640 --> 0:13:15.160
<v Speaker 2>that while the US military may succeed in degrading Iranian capabilities,

0:13:15.320 --> 0:13:17.960
<v Speaker 2>it has dug itself a large hull in responding to

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<v Speaker 2>other global conflicts. Seth joints are now for more.

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<v Speaker 1>Seth, good morning, good morning.

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<v Speaker 2>Where and how is this making the US more vulnerable?

0:13:25.559 --> 0:13:25.679
<v Speaker 5>Well?

0:13:25.679 --> 0:13:28.640
<v Speaker 8>I think the reality as the US's own national defense

0:13:28.679 --> 0:13:32.640
<v Speaker 8>strategy and national security strategy. Note that the US priorities

0:13:32.960 --> 0:13:35.720
<v Speaker 8>are elsewhere in the world, China in particular, but also

0:13:36.240 --> 0:13:38.760
<v Speaker 8>the US notes Latin America is an ongoing war in

0:13:39.000 --> 0:13:41.760
<v Speaker 8>Ukraine with the Russians right now, and the US is

0:13:41.840 --> 0:13:44.880
<v Speaker 8>already running low. It was already low before this war started,

0:13:44.920 --> 0:13:48.439
<v Speaker 8>on key stock piles of both offensive long range munitions

0:13:48.920 --> 0:13:52.240
<v Speaker 8>like the JAZZM and the Tomahawk, and also on defensive

0:13:52.360 --> 0:13:56.640
<v Speaker 8>munitions for Patriot and THAD. So as those stockpiles run low,

0:13:57.040 --> 0:13:59.480
<v Speaker 8>there's a big question. With the Chinese pretty active in

0:13:59.520 --> 0:14:02.040
<v Speaker 8>the Taiwan Straits in the South China, see how much

0:14:02.080 --> 0:14:04.600
<v Speaker 8>the US is going to have left in its bins

0:14:04.679 --> 0:14:05.600
<v Speaker 8>for the future.

0:14:05.800 --> 0:14:07.960
<v Speaker 6>Lots of reporting too as well, that China is keenly

0:14:08.000 --> 0:14:10.680
<v Speaker 6>focused on this to understand how the US military works.

0:14:10.720 --> 0:14:13.439
<v Speaker 6>What are they learning from our offensive right now on the.

0:14:13.360 --> 0:14:16.959
<v Speaker 8>Gulf, Well, I think they are seeing, to be clear,

0:14:17.000 --> 0:14:20.240
<v Speaker 8>they are seeing a US and an Israeli military that

0:14:20.320 --> 0:14:22.960
<v Speaker 8>are superb but precisions strike.

0:14:23.720 --> 0:14:25.800
<v Speaker 1>They are also superb at air defense.

0:14:25.840 --> 0:14:28.600
<v Speaker 8>I mean we are shooting down a large number of

0:14:28.800 --> 0:14:30.520
<v Speaker 8>Iranian drones.

0:14:30.160 --> 0:14:31.800
<v Speaker 1>Cruise missiles, ballistic missiles.

0:14:31.920 --> 0:14:36.000
<v Speaker 8>We're also striking with precision the leadership command of control bases.

0:14:36.400 --> 0:14:40.600
<v Speaker 8>But you also see the limitations of the US military.

0:14:40.640 --> 0:14:44.400
<v Speaker 8>It's stockpiles of munitions, and you also see that asymmetric

0:14:44.480 --> 0:14:47.280
<v Speaker 8>challenges that the US faced in Iraq and Afghanistan.

0:14:47.520 --> 0:14:49.720
<v Speaker 1>We're seeing now in the Strait of Hormuz, which is

0:14:49.760 --> 0:14:50.640
<v Speaker 1>the threat of minds.

0:14:50.680 --> 0:14:53.800
<v Speaker 8>It's not a big conventional force that the Iranians have,

0:14:53.880 --> 0:14:57.360
<v Speaker 8>but it's those asymmetric challenges that do pose the throat.

0:14:57.400 --> 0:14:59.240
<v Speaker 6>You touched on it when you're talking about the Chinese

0:14:59.280 --> 0:15:01.560
<v Speaker 6>vessels that are in the Taiwan Strait. Would this be

0:15:01.600 --> 0:15:04.640
<v Speaker 6>an opportune time for Shijiping to do something when it

0:15:04.640 --> 0:15:05.800
<v Speaker 6>comes to Taiwan.

0:15:05.800 --> 0:15:07.840
<v Speaker 1>It's possible. Anything is possible.

0:15:07.880 --> 0:15:10.520
<v Speaker 8>The big challenge for the Chinese at this very moment

0:15:10.680 --> 0:15:15.200
<v Speaker 8>is they have obliterated their leadership within the last two

0:15:15.200 --> 0:15:18.280
<v Speaker 8>to three years. They've gotten rid of over one hundred

0:15:18.400 --> 0:15:24.080
<v Speaker 8>senior PLA People's Liberation Army officials, including of their top committee,

0:15:23.800 --> 0:15:28.200
<v Speaker 8>the CMC. So the Chinese are not really in a

0:15:28.240 --> 0:15:33.000
<v Speaker 8>position from all levels, the strategic down to the tactical

0:15:33.080 --> 0:15:36.160
<v Speaker 8>level operators to make a move at this point.

0:15:36.320 --> 0:15:39.560
<v Speaker 1>But we do see them. I was up in an aircraft.

0:15:39.400 --> 0:15:42.760
<v Speaker 8>US Navy P eight in the South China Sea last year.

0:15:43.240 --> 0:15:44.720
<v Speaker 1>The Chinese are everywhere.

0:15:44.720 --> 0:15:48.160
<v Speaker 8>They're conducting exercises on a regular basis around the Taiwan

0:15:48.160 --> 0:15:51.880
<v Speaker 8>Strait to simulate a blockade, so they're certainly thinking about

0:15:51.920 --> 0:15:54.520
<v Speaker 8>it that I don't think now was the ideal time

0:15:54.640 --> 0:15:56.320
<v Speaker 8>for them, just because of what they've done.

0:15:56.560 --> 0:15:59.760
<v Speaker 5>There's a question about just the munitions and what type

0:15:59.760 --> 0:16:02.160
<v Speaker 5>of re sources the United States has. There's also a

0:16:02.240 --> 0:16:05.440
<v Speaker 5>question of alliances and where they lie. How do you

0:16:05.440 --> 0:16:08.640
<v Speaker 5>see them really shifting in the wake of, and perhaps

0:16:08.680 --> 0:16:10.800
<v Speaker 5>accelerated by this war in Iran?

0:16:11.800 --> 0:16:13.480
<v Speaker 1>So I mean on the alliance structure.

0:16:13.640 --> 0:16:17.200
<v Speaker 8>I've talked to a couple of senior European defense officials,

0:16:17.240 --> 0:16:20.200
<v Speaker 8>including Minister of Defense the other day of one of

0:16:20.200 --> 0:16:23.680
<v Speaker 8>the US's NATO allies. I think the challenge they were

0:16:23.720 --> 0:16:26.000
<v Speaker 8>never briefed on this war to begin with. They were

0:16:26.040 --> 0:16:30.760
<v Speaker 8>asked once the US struggled along those lines to come in.

0:16:30.960 --> 0:16:33.560
<v Speaker 8>The same was true with the US allies in Japan,

0:16:33.880 --> 0:16:37.320
<v Speaker 8>South Korea, Australia, all of which have been hesitant to

0:16:37.440 --> 0:16:41.640
<v Speaker 8>jump into the war that the US in Israel started.

0:16:41.880 --> 0:16:44.920
<v Speaker 1>So I think the US position.

0:16:44.640 --> 0:16:47.600
<v Speaker 8>With some of these allies has been very transactional recently,

0:16:48.000 --> 0:16:49.920
<v Speaker 8>and I think at some point there has to be

0:16:49.960 --> 0:16:52.920
<v Speaker 8>an effort to bring them, bring them more closely together.

0:16:52.960 --> 0:16:55.840
<v Speaker 8>But they are very concerned, the ones in Asia about

0:16:55.840 --> 0:16:58.000
<v Speaker 8>the growth of the Chinese, and the ones in Europe

0:16:58.160 --> 0:16:59.800
<v Speaker 8>very concerned about the Russian military.

0:17:00.200 --> 0:17:02.640
<v Speaker 2>Just to finish on China, have we the US and

0:17:02.640 --> 0:17:06.320
<v Speaker 2>I think about Chinese capabilities in places like around in

0:17:06.400 --> 0:17:10.760
<v Speaker 2>places like Venezuela, and deficiency specifically, I.

0:17:10.680 --> 0:17:12.080
<v Speaker 1>Mean on the Chinese side.

0:17:12.400 --> 0:17:14.960
<v Speaker 8>The realities, the Chinese have not fought a war since

0:17:14.960 --> 0:17:18.919
<v Speaker 8>the nineteen seventies, and they weren't particularly effective. But what

0:17:18.960 --> 0:17:22.639
<v Speaker 8>they have done is they've provided components to the Russians

0:17:22.680 --> 0:17:27.480
<v Speaker 8>in the war in Ukraine. They've also provided components in

0:17:27.560 --> 0:17:31.119
<v Speaker 8>various types of assistance, including intelligence to the Iranians, not

0:17:31.280 --> 0:17:33.840
<v Speaker 8>just now what over the last several years, including to

0:17:34.040 --> 0:17:36.600
<v Speaker 8>some of Iran's partner forces, including the HOHO this in Yemen.

0:17:36.720 --> 0:17:42.000
<v Speaker 8>So they've also put contractors and intelligence officials on the

0:17:42.040 --> 0:17:44.880
<v Speaker 8>ground to learn how to conduct these kinds of war.

0:17:45.000 --> 0:17:46.439
<v Speaker 1>So they are taking notes.

0:17:46.680 --> 0:17:49.639
<v Speaker 2>How flawed is that experience though given how clean the

0:17:49.680 --> 0:17:52.119
<v Speaker 2>operation was in a place like Venezuela. We've had all

0:17:52.200 --> 0:17:54.800
<v Speaker 2>things like they've got the defense systems that were sell

0:17:54.880 --> 0:17:57.520
<v Speaker 2>to them by the Chinese, and ultimately none of it

0:17:57.520 --> 0:17:59.800
<v Speaker 2>stood up against US capability.

0:18:00.040 --> 0:18:03.040
<v Speaker 8>I mean, it really shows in some ways actually, and

0:18:03.240 --> 0:18:05.240
<v Speaker 8>I know there had been there have been some comments

0:18:05.320 --> 0:18:09.000
<v Speaker 8>last year about the expense of say the F thirty

0:18:09.040 --> 0:18:11.040
<v Speaker 8>five stealth aircraft, which is.

0:18:11.000 --> 0:18:12.240
<v Speaker 1>In the billions of dollars.

0:18:12.640 --> 0:18:15.639
<v Speaker 8>But the benefit of a fifth generation stealth aircraft that

0:18:15.760 --> 0:18:16.760
<v Speaker 8>Lockeed Martin.

0:18:16.440 --> 0:18:19.439
<v Speaker 1>Makes is that it's hard for radar to see it.

0:18:19.760 --> 0:18:22.639
<v Speaker 8>So one of the things I think that even those

0:18:22.960 --> 0:18:26.000
<v Speaker 8>Chinese and Russian air defense systems are finding out is

0:18:26.040 --> 0:18:28.240
<v Speaker 8>that a fifth generation and the US is now working

0:18:28.280 --> 0:18:30.960
<v Speaker 8>on a sixth generation aircraft, they are tough to see.

0:18:31.680 --> 0:18:35.240
<v Speaker 2>This is the Bloomberg Survandans podcast, bringing you the best

0:18:35.280 --> 0:18:38.560
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