1 00:00:00,080 --> 00:00:10,119 Speaker 1: Bloomberg Audio Studios, podcasts, radio news. You're listening to the 2 00:00:10,119 --> 00:00:13,880 Speaker 1: Bloomberg Balance of Power podcast. Catch us live weekdays at 3 00:00:13,920 --> 00:00:17,119 Speaker 1: noon and five pm Eastern on Apple, Cockley and Android 4 00:00:17,160 --> 00:00:20,560 Speaker 1: Auto with the Bloomberg Business App. Listen on demand wherever 5 00:00:20,600 --> 00:00:25,080 Speaker 1: you get your podcasts, or watch us live on YouTube. 6 00:00:25,600 --> 00:00:30,880 Speaker 2: This market again takes a deep breath here, another cleansing breath. 7 00:00:30,920 --> 00:00:33,400 Speaker 2: That's the White House changes course on a couple of 8 00:00:33,440 --> 00:00:37,000 Speaker 2: pretty significant issues. We're talking tariffs, and we're talking about 9 00:00:37,040 --> 00:00:39,960 Speaker 2: the FED share the tariffs. Even at this time yesterday, 10 00:00:40,000 --> 00:00:42,760 Speaker 2: people were feeling better. After Scott Bessen suggested the standoff 11 00:00:42,800 --> 00:00:47,199 Speaker 2: couldn't last unsustainable, musty escalate? President Trump added to that 12 00:00:47,320 --> 00:00:50,479 Speaker 2: quite a bit, suggesting that tariffs could be significantly lower, 13 00:00:50,960 --> 00:00:55,640 Speaker 2: specifically on China, as talks continue. And then the matter 14 00:00:55,720 --> 00:00:58,880 Speaker 2: of Jay Powell came up. You know, reporters were in 15 00:00:58,880 --> 00:01:00,959 Speaker 2: the Oval Office. He was there actually to swear in 16 00:01:01,000 --> 00:01:04,560 Speaker 2: the chair of the SEC. You know where the conversation 17 00:01:04,720 --> 00:01:07,119 Speaker 2: was going to go. After Donald Trump threatened to fire 18 00:01:07,160 --> 00:01:09,920 Speaker 2: the FED share a couple days in a row. Not 19 00:01:10,120 --> 00:01:12,520 Speaker 2: sounding so much like that. Now, listen to the President. 20 00:01:13,440 --> 00:01:16,240 Speaker 3: Now, I have no intention of firing him I would 21 00:01:16,319 --> 00:01:19,440 Speaker 3: like to see him be a little more active in 22 00:01:19,520 --> 00:01:23,200 Speaker 3: terms of his idea to lower interest rate. It's just 23 00:01:23,200 --> 00:01:27,040 Speaker 3: a perfect time to lower interest rates. If he doesn't 24 00:01:27,160 --> 00:01:29,520 Speaker 3: is at the end to know it's not, but it 25 00:01:29,560 --> 00:01:33,160 Speaker 3: would be good timing it, which could have taken place earlier. 26 00:01:33,560 --> 00:01:36,800 Speaker 3: But no, I have no intention to fire him. 27 00:01:37,120 --> 00:01:40,840 Speaker 2: Why did you hear something? It was only forty eight 28 00:01:40,880 --> 00:01:44,920 Speaker 2: hours earlier? Actually what twenty four hours earlier? Donald Trump 29 00:01:45,000 --> 00:01:47,720 Speaker 2: posted on truth Social there could be a slowing of 30 00:01:47,760 --> 00:01:51,000 Speaker 2: the economy. He wrote, unless mister too late, a major 31 00:01:51,080 --> 00:01:56,360 Speaker 2: loser lower's interest rates. Now he went under right. Powell 32 00:01:56,400 --> 00:01:58,520 Speaker 2: has always been too late, except when it came to 33 00:01:58,560 --> 00:02:01,360 Speaker 2: the election period, when in order to help Sleepy Joe 34 00:02:01,400 --> 00:02:03,960 Speaker 2: Biden later kammally get elected. How did that work out? 35 00:02:04,080 --> 00:02:07,760 Speaker 2: Remember he said he could not be terminated soon enough. 36 00:02:09,760 --> 00:02:11,480 Speaker 2: And now there's a whole round of reporting about how 37 00:02:11,480 --> 00:02:13,720 Speaker 2: Scott Bessett and Howard Lutnik walked this one into the 38 00:02:13,720 --> 00:02:18,040 Speaker 2: Oval office and pulled the President back from his desire 39 00:02:18,120 --> 00:02:21,840 Speaker 2: to fire the chair of the Fed, the very man 40 00:02:21,880 --> 00:02:26,720 Speaker 2: he appointed. And so we're traveling in reverse here when 41 00:02:26,720 --> 00:02:28,720 Speaker 2: it comes to the messaging and moving higher on Wall 42 00:02:28,760 --> 00:02:32,520 Speaker 2: Street with our panel in place. Bloomberg Politics contributors Rick 43 00:02:32,600 --> 00:02:35,519 Speaker 2: Davis and Jeanie Shanzano are with us right now. Genie is, 44 00:02:35,560 --> 00:02:39,399 Speaker 2: of course democratic analyst and political science professor at Iona University. 45 00:02:39,480 --> 00:02:43,120 Speaker 2: Rick a Republican strategist and partner at stone Court Capital. 46 00:02:43,480 --> 00:02:48,320 Speaker 2: So Janie, the headline today is never mind, that's right, 47 00:02:48,480 --> 00:02:50,799 Speaker 2: And Joe, I'm trying to be positive on a Wednesday, 48 00:02:50,840 --> 00:02:51,440 Speaker 2: So I'm going to. 49 00:02:51,480 --> 00:02:52,880 Speaker 4: Say there's good news here. 50 00:02:53,280 --> 00:02:56,440 Speaker 5: Number one is that for the first time we are 51 00:02:56,520 --> 00:03:00,560 Speaker 5: seeing that the Trump administration in at least two point 52 00:03:00,639 --> 00:03:04,320 Speaker 5: zero is responding to the market. So that is a 53 00:03:04,360 --> 00:03:07,720 Speaker 5: good thing, and it shows, really to your point, how 54 00:03:07,840 --> 00:03:10,480 Speaker 5: hungry the market is for some good news, even if 55 00:03:10,520 --> 00:03:14,160 Speaker 5: it's just little tidbits like this, you know. On the 56 00:03:14,200 --> 00:03:17,800 Speaker 5: negative side, the reality is we are in a situation 57 00:03:18,000 --> 00:03:21,400 Speaker 5: where the markets are hoping number one, that Donald Trump 58 00:03:21,480 --> 00:03:24,000 Speaker 5: doesn't pursue his policies, and number. 59 00:03:23,720 --> 00:03:25,600 Speaker 4: Two, that he doesn't mean what he says. 60 00:03:25,680 --> 00:03:27,919 Speaker 5: So when he says would be great to get rid 61 00:03:27,919 --> 00:03:31,480 Speaker 5: of Jerome Powell, you know all of these things, they're 62 00:03:31,560 --> 00:03:32,960 Speaker 5: praying that he doesn't mean it. 63 00:03:33,120 --> 00:03:34,200 Speaker 4: So that's a. 64 00:03:34,120 --> 00:03:37,200 Speaker 5: Situation we're in, and that is not a very good place. 65 00:03:37,240 --> 00:03:39,640 Speaker 5: For a country to find itself. But it is a 66 00:03:39,680 --> 00:03:41,800 Speaker 5: little bit of bright light from what's been a pretty 67 00:03:41,800 --> 00:03:42,480 Speaker 5: tough month. 68 00:03:42,320 --> 00:03:43,000 Speaker 4: Through the markets. 69 00:03:43,120 --> 00:03:46,720 Speaker 2: Yeah. Well, boy, I guess that's for sure, Rick. These 70 00:03:46,760 --> 00:03:50,720 Speaker 2: are all market moving comments, whether it's the president or 71 00:03:50,720 --> 00:03:54,200 Speaker 2: the Treasury secretary that we're hearing from. Earlier today, Scott 72 00:03:54,200 --> 00:03:58,080 Speaker 2: Bessett said, yes, America first, but that does not mean 73 00:03:58,160 --> 00:04:01,760 Speaker 2: America alone. Is that the difference of the messaging here 74 00:04:02,200 --> 00:04:03,200 Speaker 2: that's soothing the market? 75 00:04:04,560 --> 00:04:04,800 Speaker 6: Yeah? 76 00:04:04,840 --> 00:04:08,760 Speaker 7: I think that what we're seeing is Trump's reaction not 77 00:04:08,920 --> 00:04:12,520 Speaker 7: to the markets, but but to his advisors and and 78 00:04:12,600 --> 00:04:16,520 Speaker 7: to you know, the corporations that came in on Monday, Walmart, 79 00:04:17,120 --> 00:04:22,279 Speaker 7: you know, and and a few others talking about empty shelves, 80 00:04:22,480 --> 00:04:26,080 Speaker 7: and because we've seen the markets gyrate wildly in the 81 00:04:26,160 --> 00:04:28,800 Speaker 7: one hundred days that he's been president, and he hasn't 82 00:04:28,800 --> 00:04:32,599 Speaker 7: really seemingly cared. But I think when they walk into 83 00:04:32,640 --> 00:04:34,520 Speaker 7: the Oval office and they say, hey, look we've got 84 00:04:34,520 --> 00:04:37,320 Speaker 7: a problem, boss, he sits up and listens. And so 85 00:04:38,080 --> 00:04:43,320 Speaker 7: I think that that a lot of this isolationism discussion. 86 00:04:42,880 --> 00:04:44,280 Speaker 2: Has been a little overwrought. 87 00:04:44,440 --> 00:04:48,240 Speaker 7: I think, you know, Secretary Vestan's effort to try and 88 00:04:49,760 --> 00:04:52,799 Speaker 7: rationalize it a little bit was probably a good investment 89 00:04:52,800 --> 00:04:56,039 Speaker 7: of time today, you know, during the IMF meetings or 90 00:04:56,120 --> 00:05:00,640 Speaker 7: bank meetings, because we are active with multilateral instats. We're 91 00:05:00,680 --> 00:05:05,080 Speaker 7: negotiating with the European Union. We're not isolating European countries 92 00:05:05,480 --> 00:05:08,200 Speaker 7: one by one, which you could have imagined what happened. 93 00:05:09,279 --> 00:05:13,760 Speaker 7: You know, Trump has, you know, formulated efforts to try 94 00:05:13,800 --> 00:05:17,599 Speaker 7: and be supportive of these lending institutions that Lessons speaking to. 95 00:05:18,800 --> 00:05:21,840 Speaker 7: So the reality is and there are all kinds of 96 00:05:22,400 --> 00:05:27,880 Speaker 7: engagements around the world around you know, negotiations with Iranians 97 00:05:27,880 --> 00:05:31,440 Speaker 7: on nuclear weapons, negotiations with the Russians and the Ukrainians 98 00:05:31,440 --> 00:05:35,960 Speaker 7: on stoff in the war. Look, I mean, it isn't 99 00:05:36,000 --> 00:05:38,960 Speaker 7: what you would expect out of a Republican president, but 100 00:05:39,560 --> 00:05:42,359 Speaker 7: in this case, it is more than you would have 101 00:05:42,400 --> 00:05:44,360 Speaker 7: expected from Donald Trump. 102 00:05:44,440 --> 00:05:49,320 Speaker 2: The isolations pretty amazing stuff here, Genie, what's your thought, 103 00:05:49,360 --> 00:05:51,520 Speaker 2: do we have Target to thank that or Scott Besstt, 104 00:05:51,520 --> 00:05:55,760 Speaker 2: Because Rick is right Walmart Target Home Depot sitting in 105 00:05:55,800 --> 00:05:58,160 Speaker 2: the Oval office saying not only are prices going to 106 00:05:58,200 --> 00:06:01,480 Speaker 2: go up, but you're going to see empty shells if 107 00:06:01,480 --> 00:06:05,200 Speaker 2: you continue. That's that's the imagery that changed Donald Trump's mind. 108 00:06:05,080 --> 00:06:07,000 Speaker 4: Isn't it Well? 109 00:06:07,240 --> 00:06:09,600 Speaker 5: I can't read what changed his mind. He did have 110 00:06:09,680 --> 00:06:13,320 Speaker 5: those meetings with those big box CEOs. He is, you know, 111 00:06:13,400 --> 00:06:16,520 Speaker 5: seems to be listening a bit to Scott Besson. But 112 00:06:16,640 --> 00:06:20,120 Speaker 5: I think the real question here number one, what is 113 00:06:20,160 --> 00:06:23,800 Speaker 5: the long term impact of this policy of protectionism he 114 00:06:23,880 --> 00:06:25,000 Speaker 5: has been pursuing. 115 00:06:25,600 --> 00:06:30,200 Speaker 4: And number two, and most importantly, what is the world 116 00:06:30,279 --> 00:06:30,680 Speaker 4: to think? 117 00:06:30,720 --> 00:06:32,960 Speaker 5: And what are we as Americans to think about a 118 00:06:33,000 --> 00:06:35,919 Speaker 5: president and a White House who seemed to be the 119 00:06:35,960 --> 00:06:38,960 Speaker 5: gang that can't shoot straight. On the one hand, he 120 00:06:39,160 --> 00:06:41,960 Speaker 5: says one thing one day, one thing the next day, 121 00:06:42,320 --> 00:06:46,320 Speaker 5: and it raises real questions about competence. So I don't 122 00:06:46,320 --> 00:06:48,760 Speaker 5: know if it much matters if he's listening to CEO, 123 00:06:48,880 --> 00:06:52,400 Speaker 5: Scott Bessen or the market. He did pull back what 124 00:06:52,480 --> 00:06:55,599 Speaker 5: he had said a few hours earlier yesterday, and the 125 00:06:55,640 --> 00:06:59,760 Speaker 5: markets responded positively. But this is no way to run 126 00:07:00,040 --> 00:07:04,279 Speaker 5: the global economy or the US economy on these kinds 127 00:07:04,320 --> 00:07:07,880 Speaker 5: of whims. And you know, for everybody who feels confident 128 00:07:07,960 --> 00:07:10,640 Speaker 5: that his attacks on Powell are, you know, a thing 129 00:07:10,680 --> 00:07:13,960 Speaker 5: of the past, he seems to flip like the wind 130 00:07:14,000 --> 00:07:14,559 Speaker 5: these days. 131 00:07:14,600 --> 00:07:16,840 Speaker 4: So I'm not so sure that next week when the 132 00:07:16,880 --> 00:07:19,120 Speaker 4: FED meeting his meeting. He's not going to go back 133 00:07:19,120 --> 00:07:20,720 Speaker 4: on the attack. Doesn't mean he's. 134 00:07:20,560 --> 00:07:25,840 Speaker 2: Going to fire it, but we'll be watching truth social 135 00:07:25,880 --> 00:07:28,560 Speaker 2: of course. I just wonder when we consider the the 136 00:07:28,560 --> 00:07:31,520 Speaker 2: deal making aspect of all of this, what the message 137 00:07:31,560 --> 00:07:34,240 Speaker 2: is to China. Let's go back to the Oval Office 138 00:07:34,320 --> 00:07:37,480 Speaker 2: last evening and here Donald Trump on tariffs for Beijing. 139 00:07:37,560 --> 00:07:40,320 Speaker 3: Listen, I'm not gonna say, oh, I'm gonna play hardball 140 00:07:40,400 --> 00:07:40,880 Speaker 3: with China. 141 00:07:40,960 --> 00:07:43,920 Speaker 8: I'm going to play hardball with you President She. No, No, 142 00:07:44,360 --> 00:07:46,520 Speaker 8: We're going to be very nice. They're going to be 143 00:07:46,640 --> 00:07:50,120 Speaker 8: very nice, and we'll see what happens. But ultimately they 144 00:07:50,160 --> 00:07:52,960 Speaker 8: have to make a deal because otherwise they're not going 145 00:07:53,000 --> 00:07:55,600 Speaker 8: to be able to deal in the United States. 146 00:07:55,680 --> 00:07:57,000 Speaker 3: So we want them involved. 147 00:07:58,920 --> 00:08:01,400 Speaker 2: Okay, so we're not going to play hardball, Rick Davis, 148 00:08:01,920 --> 00:08:04,400 Speaker 2: what is the message there to President She? We're going 149 00:08:04,440 --> 00:08:06,440 Speaker 2: to be very nice. Is that the way to set 150 00:08:06,480 --> 00:08:09,000 Speaker 2: up a meeting? Yeah? 151 00:08:09,040 --> 00:08:12,120 Speaker 7: First of all, one hundred and forty five percent tariff 152 00:08:12,240 --> 00:08:15,080 Speaker 7: is hardball. I don't know that may be a dictionary 153 00:08:15,160 --> 00:08:19,600 Speaker 7: definition of hardball. It is an embargo against Chinese goods 154 00:08:19,640 --> 00:08:22,240 Speaker 7: into the United States. One's our largest trading partner. So 155 00:08:23,520 --> 00:08:25,920 Speaker 7: whether or not you're calling them names is one thing. 156 00:08:26,000 --> 00:08:29,720 Speaker 7: But like when you shut off trade to a country 157 00:08:29,760 --> 00:08:32,640 Speaker 7: like China that is solely dependent upon it for their economy, 158 00:08:33,640 --> 00:08:38,120 Speaker 7: it's it's playing hardball. So it's confusing because we have 159 00:08:38,200 --> 00:08:44,200 Speaker 7: so many inter you know, connecting priorities. You know, everything 160 00:08:44,280 --> 00:08:51,040 Speaker 7: from military and issues related to Taiwan in the Indo 161 00:08:51,120 --> 00:08:56,240 Speaker 7: Pacific to our trade relationships. It impacts everything like climate. 162 00:08:57,040 --> 00:08:59,640 Speaker 7: I mean, China in the US has to find a 163 00:08:59,640 --> 00:09:04,440 Speaker 7: way to get along otherwise there's conflict. There's conflict economically 164 00:09:04,840 --> 00:09:07,880 Speaker 7: and militarily, and that is bad for the world. If 165 00:09:07,960 --> 00:09:11,840 Speaker 7: China gets a cold, we start showing symptoms and vice versa. 166 00:09:12,040 --> 00:09:16,719 Speaker 7: So this is good news that Donald Trump is seemingly 167 00:09:16,840 --> 00:09:20,240 Speaker 7: open for business when it comes to negotiating a trade 168 00:09:20,240 --> 00:09:22,160 Speaker 7: to deal with China that's different than the current one. 169 00:09:22,640 --> 00:09:25,400 Speaker 7: The question I have is what's China thinking, because they 170 00:09:25,440 --> 00:09:27,760 Speaker 7: got to be sitting there in Beijing going what the 171 00:09:27,840 --> 00:09:32,320 Speaker 7: heck is going on here? You know, he's waiting for 172 00:09:32,400 --> 00:09:32,880 Speaker 7: our call. 173 00:09:33,400 --> 00:09:34,640 Speaker 6: We don't call. 174 00:09:35,360 --> 00:09:38,200 Speaker 7: She goes around, starts meeting with the Vietnamese and other 175 00:09:38,400 --> 00:09:41,120 Speaker 7: friends and allies of the United States, and all of 176 00:09:41,160 --> 00:09:45,400 Speaker 7: a sudden Donald Trump's tune changes. So look, I'm glad 177 00:09:45,400 --> 00:09:48,679 Speaker 7: it's where it is, and you know, partly concern like 178 00:09:49,000 --> 00:09:52,520 Speaker 7: genius about what the future brings, because if we're running 179 00:09:52,520 --> 00:09:55,480 Speaker 7: hot first cold second, hot first cold second, I mean 180 00:09:55,559 --> 00:09:59,880 Speaker 7: like it's a new definition of good cop, bad cop, 181 00:10:00,000 --> 00:10:01,280 Speaker 7: because you're the same person. 182 00:10:03,280 --> 00:10:07,080 Speaker 2: I think there's a word for that. Well, I'll tell 183 00:10:07,080 --> 00:10:09,360 Speaker 2: you what. If it takes two years, like Scott Bessen said, 184 00:10:09,440 --> 00:10:12,400 Speaker 2: or three to come to an important trade deal with China, 185 00:10:12,480 --> 00:10:15,440 Speaker 2: we do know one lawmaker who will not be here 186 00:10:15,600 --> 00:10:20,000 Speaker 2: for it. Pretty important news today, Genie the Senator from 187 00:10:20,040 --> 00:10:22,880 Speaker 2: Illinois is leaving the building. This is Dick Durbin from 188 00:10:22,960 --> 00:10:24,719 Speaker 2: social media a short time ago. 189 00:10:25,280 --> 00:10:27,560 Speaker 9: The decision of whether to run for reelection has not 190 00:10:27,679 --> 00:10:30,079 Speaker 9: been easy. I truly love the job of being a 191 00:10:30,200 --> 00:10:32,920 Speaker 9: United States Senator, but in my heart, I know it's 192 00:10:32,960 --> 00:10:35,880 Speaker 9: time to pass the torch. So I'm announcing today that 193 00:10:35,960 --> 00:10:38,160 Speaker 9: I will not be seeking reelection at the end of 194 00:10:38,160 --> 00:10:41,200 Speaker 9: my term. The people of Illinois have honored me with 195 00:10:41,240 --> 00:10:44,960 Speaker 9: this responsibility longer than anyone elected to the Senate in 196 00:10:45,000 --> 00:10:49,600 Speaker 9: our state's history. I'm truly grateful, all right. 197 00:10:49,880 --> 00:10:52,440 Speaker 2: I look, maybe not surprised We've been waiting on this one, 198 00:10:52,480 --> 00:10:56,520 Speaker 2: but we're talking about the second ranking Democrat in the 199 00:10:56,640 --> 00:11:01,319 Speaker 2: United States, Senate Genie A Lion the Democratic Party. Does 200 00:11:01,360 --> 00:11:05,480 Speaker 2: this say more about Dick Durbin's age or the state 201 00:11:05,559 --> 00:11:06,840 Speaker 2: of politics in Washington? 202 00:11:08,280 --> 00:11:10,560 Speaker 5: You know, forty four years is a long time for 203 00:11:10,640 --> 00:11:13,400 Speaker 5: any of us to be in one job. He's the 204 00:11:13,400 --> 00:11:18,160 Speaker 5: fifth Senator over sixty five to retire this term, as 205 00:11:18,200 --> 00:11:21,400 Speaker 5: you mentioned, not a surprise. I do think it speaks 206 00:11:21,440 --> 00:11:24,800 Speaker 5: to this recognition we've been seeing on the Democratic side, 207 00:11:24,840 --> 00:11:27,960 Speaker 5: in the Republican side, but the Democratic side, that you 208 00:11:28,160 --> 00:11:31,840 Speaker 5: do need to make sure you bring up the people 209 00:11:31,840 --> 00:11:35,080 Speaker 5: who are coming behind you. And there's a lot of 210 00:11:35,200 --> 00:11:40,520 Speaker 5: good Democrats in the Illinois contingent, you know, on the 211 00:11:40,559 --> 00:11:43,760 Speaker 5: Democratic side who have expressed interest in running if he 212 00:11:43,920 --> 00:11:47,360 Speaker 5: was to set aside, including a very popular lieutenant governor. 213 00:11:47,840 --> 00:11:50,720 Speaker 5: So I do think it is he knew it was time. 214 00:11:50,840 --> 00:11:54,000 Speaker 5: I gotta say, Joe, I love the music behind that video. 215 00:11:55,000 --> 00:11:58,080 Speaker 5: But you know, he has served, you know, very admirably, 216 00:11:58,600 --> 00:12:01,280 Speaker 5: and I think he sort of paves the way of 217 00:12:01,320 --> 00:12:03,800 Speaker 5: saying I'm going to go while I am in a 218 00:12:03,840 --> 00:12:07,360 Speaker 5: good position and leaving behind a seat that can be 219 00:12:07,400 --> 00:12:08,600 Speaker 5: filled by Democrats. 220 00:12:08,640 --> 00:12:12,160 Speaker 2: They hope, Rick, we've only got about a minute left. 221 00:12:12,200 --> 00:12:14,520 Speaker 2: You worked with and around Dick Durbin in the United 222 00:12:14,559 --> 00:12:17,080 Speaker 2: States Senate in your time with Senator John McCain. This 223 00:12:17,120 --> 00:12:20,640 Speaker 2: stays Democrat, right, This isn't a threat to the seat 224 00:12:20,679 --> 00:12:22,200 Speaker 2: count for Democrats in the Senate. 225 00:12:22,840 --> 00:12:24,959 Speaker 7: You know they're going to have to spend money. Some 226 00:12:25,000 --> 00:12:28,920 Speaker 7: of their candidates, Rob Emmanuel, others are lining up. They're 227 00:12:28,920 --> 00:12:30,960 Speaker 7: gonna have a good candidate comes out of that primary. 228 00:12:31,040 --> 00:12:35,320 Speaker 7: But remember Mark Kirk was the last Republican that got 229 00:12:35,320 --> 00:12:38,320 Speaker 7: elected to the Senate in Illinois. And so it's not 230 00:12:38,360 --> 00:12:42,840 Speaker 7: a miracle. And yet I would say likely a bad 231 00:12:42,920 --> 00:12:47,720 Speaker 7: year for Republicans, and so I would think the seat 232 00:12:47,760 --> 00:12:50,120 Speaker 7: probably stays the same. But durban was a class act, 233 00:12:50,280 --> 00:12:53,800 Speaker 7: is a class act, worked well with John McCain and 234 00:12:53,800 --> 00:12:57,880 Speaker 7: other Republicans, was a bipartisan and yet knew how to 235 00:12:57,880 --> 00:12:58,520 Speaker 7: throw a punch. 236 00:13:00,040 --> 00:13:02,320 Speaker 2: That's right. We've always enjoyed our conversations with him here 237 00:13:02,360 --> 00:13:05,080 Speaker 2: on Balance of Power. I hope we'll have more opportunities. 238 00:13:07,320 --> 00:13:10,800 Speaker 1: You're listening to the Bloomberg Balance of Power podcast ketch 239 00:13:10,880 --> 00:13:13,920 Speaker 1: Us Live weekdays at noon and five pm Eastern on 240 00:13:14,040 --> 00:13:17,280 Speaker 1: Apple Cocklay and Android Auto with the Bloomberg Business app. 241 00:13:17,320 --> 00:13:20,360 Speaker 1: You can also listen live on Amazon Alexa from our 242 00:13:20,400 --> 00:13:25,520 Speaker 1: flagship New York station Just Say Alexa played Bloomberg eleven thirty. 243 00:13:26,440 --> 00:13:29,760 Speaker 10: Secretary Beston, telling reporters that the US is not looking 244 00:13:29,800 --> 00:13:33,120 Speaker 10: to unilaterally lower tariffs against China, though perhaps if you're 245 00:13:33,160 --> 00:13:36,199 Speaker 10: looking for areas of optimism, he did suggest a trade 246 00:13:36,240 --> 00:13:39,560 Speaker 10: deal with India is getting closer, at least some kind 247 00:13:39,559 --> 00:13:42,880 Speaker 10: of understanding as to what the broad architecture of that 248 00:13:43,200 --> 00:13:45,240 Speaker 10: could look like, keeping in mind these deals may take 249 00:13:45,280 --> 00:13:47,880 Speaker 10: some time to actually fully finalize, but of course that 250 00:13:47,920 --> 00:13:50,679 Speaker 10: has been the effort underway in India this week by 251 00:13:50,679 --> 00:13:53,040 Speaker 10: the Vice President of the United States JD. Vance, who 252 00:13:53,120 --> 00:13:55,720 Speaker 10: had bilateral talks with the Prime Minister Arrind Remodi and 253 00:13:55,760 --> 00:13:58,680 Speaker 10: talked about trade. But we also heard from the Vice 254 00:13:58,720 --> 00:14:01,120 Speaker 10: President while he was an Indiana today about a completely 255 00:14:01,120 --> 00:14:04,640 Speaker 10: separate issue, and that is ongoing efforts toward ending the 256 00:14:04,679 --> 00:14:07,360 Speaker 10: war in Ukraine, a peace agreement being reached between Ukraine 257 00:14:07,440 --> 00:14:09,360 Speaker 10: and Russia. This, of course, as there was a meeting 258 00:14:09,800 --> 00:14:11,720 Speaker 10: in London today that was supposed to be attended by 259 00:14:11,760 --> 00:14:13,719 Speaker 10: the Secretary of State Mark Rubiuo and those at the 260 00:14:13,800 --> 00:14:17,040 Speaker 10: highest levels in foreign policy in the governments of France 261 00:14:17,080 --> 00:14:20,120 Speaker 10: and Germany, in the UK and Ukraine as well. Rubio 262 00:14:20,200 --> 00:14:23,040 Speaker 10: didn't go the Envoy Keith kellag Win instead, and this 263 00:14:23,200 --> 00:14:25,680 Speaker 10: was reduced to kind of a technical level meeting. And 264 00:14:25,720 --> 00:14:28,800 Speaker 10: this is how the Vice President characterized the state of things. 265 00:14:29,560 --> 00:14:32,840 Speaker 11: We've issued a very explicit proposal to both the Russians 266 00:14:32,840 --> 00:14:35,400 Speaker 11: and the Ukrainians, and it's time for them to either 267 00:14:35,440 --> 00:14:37,880 Speaker 11: say yes or for the United States to walk away 268 00:14:37,920 --> 00:14:40,960 Speaker 11: from this process. We've engaged in an extraordinary amount of 269 00:14:41,040 --> 00:14:44,000 Speaker 11: diplomacy of on the ground work. We've really tried to 270 00:14:44,080 --> 00:14:47,080 Speaker 11: understand things from the perspective of both the Ukrainians and 271 00:14:47,080 --> 00:14:49,640 Speaker 11: the Russians. What do Ukrainians care the most about? What 272 00:14:49,640 --> 00:14:52,280 Speaker 11: do the Russians care the most about? The current lines 273 00:14:52,360 --> 00:14:54,800 Speaker 11: Somewhere close to them is where you're ultimately, I think, 274 00:14:54,800 --> 00:14:57,880 Speaker 11: going to draw all the new lines in the conflict now. 275 00:14:57,920 --> 00:15:00,760 Speaker 11: Of course, that means the Ukrainians and the Russians are 276 00:15:00,760 --> 00:15:02,160 Speaker 11: both going to have to give up some of the 277 00:15:02,240 --> 00:15:03,520 Speaker 11: territory they currently own. 278 00:15:05,240 --> 00:15:09,280 Speaker 2: Another suggestion of walking away, echoing Marco Rubio, who made 279 00:15:09,320 --> 00:15:13,480 Speaker 2: that reference on Friday, Knowing that Donald Trump campaigned on 280 00:15:13,560 --> 00:15:15,600 Speaker 2: a promise to end this war, as he said he 281 00:15:15,720 --> 00:15:17,280 Speaker 2: was the only one who could do it. He would 282 00:15:17,360 --> 00:15:21,560 Speaker 2: end this within hours on day one. He's speaking very 283 00:15:21,600 --> 00:15:26,680 Speaker 2: differently today on truth social President Trump referring to comments 284 00:15:26,800 --> 00:15:30,040 Speaker 2: from Vladimir Zelenski, as he says, boasting on the front 285 00:15:30,040 --> 00:15:32,360 Speaker 2: page of the Wall Street Journal that Ukraine will not 286 00:15:32,480 --> 00:15:36,280 Speaker 2: legally recognize the occupation of Crimea. It's a long post. 287 00:15:36,320 --> 00:15:39,800 Speaker 2: Donald Trump goes on to write, it's inflammatory statements like 288 00:15:39,880 --> 00:15:42,680 Speaker 2: Zelensky's that makes it so difficult to settle this war. 289 00:15:43,080 --> 00:15:46,440 Speaker 2: He has nothing to boast about. The situation for Ukraine, 290 00:15:46,520 --> 00:15:49,000 Speaker 2: he says, is dire. He can have peace, or he 291 00:15:49,040 --> 00:15:52,640 Speaker 2: can fight for another three years before losing the whole country. 292 00:15:53,280 --> 00:15:55,960 Speaker 2: That's where we start our conversation with Melinda Herring, nonresident 293 00:15:56,040 --> 00:16:00,920 Speaker 2: Senior Fellow Atlantic Council and a voice of urience when 294 00:16:00,920 --> 00:16:03,400 Speaker 2: it comes to all things Ukraine. Melinda, it's great to 295 00:16:03,400 --> 00:16:05,440 Speaker 2: have you back. Is that where this is going? Losing 296 00:16:05,520 --> 00:16:06,160 Speaker 2: the whole country? 297 00:16:07,600 --> 00:16:08,560 Speaker 12: Not quite, Joe. 298 00:16:08,600 --> 00:16:12,480 Speaker 13: And there's a few other factual errors in Donald Trump's 299 00:16:12,520 --> 00:16:15,760 Speaker 13: statement that he put out. So he says, why didn't 300 00:16:15,800 --> 00:16:19,880 Speaker 13: Zelensky and all of Ukraine fight for Crimea when the 301 00:16:19,960 --> 00:16:24,880 Speaker 13: Russians illegally annexed it and the Ukrainians. He forgets that 302 00:16:24,920 --> 00:16:27,400 Speaker 13: the Ukrainians didn't have any money, that there was no 303 00:16:27,560 --> 00:16:29,800 Speaker 13: way to fight back, and I think that's an important 304 00:16:29,800 --> 00:16:33,160 Speaker 13: point as well. But no, things are not headed in 305 00:16:33,200 --> 00:16:37,040 Speaker 13: a good direction. We know that the White House has 306 00:16:37,080 --> 00:16:41,680 Speaker 13: lost patience with negotiations and they found this entire negotiation 307 00:16:41,800 --> 00:16:46,040 Speaker 13: exercise much more different, are much more difficult than they expected. 308 00:16:47,720 --> 00:16:51,800 Speaker 10: Well, and certainly President Trump has suggested that Vadimer Zelensky 309 00:16:51,880 --> 00:16:56,280 Speaker 10: himself is contributing to that difficulty. The US position seems 310 00:16:56,320 --> 00:16:58,440 Speaker 10: to be, Melinda, that Ukraine is going to have to 311 00:16:58,440 --> 00:17:01,360 Speaker 10: be willing to give up some territory if they ultimately 312 00:17:01,400 --> 00:17:04,080 Speaker 10: want a settlement in this war. Is that the wrong 313 00:17:04,119 --> 00:17:06,880 Speaker 10: way of thinking about this? How could they possibly reclaim 314 00:17:06,920 --> 00:17:09,760 Speaker 10: all the territory that has been lost to CRIMEA included. 315 00:17:10,840 --> 00:17:13,359 Speaker 12: Piky Lee. I don't think that's actually the stumbling point. 316 00:17:13,480 --> 00:17:17,120 Speaker 13: So we've seen a seven point East plan and that's 317 00:17:17,160 --> 00:17:19,840 Speaker 13: what we thought they were going to be arguing about 318 00:17:19,840 --> 00:17:23,080 Speaker 13: in London. And the real stumbling points are the US 319 00:17:23,200 --> 00:17:27,080 Speaker 13: is asking Ukraine to give up NATO membership. It's also 320 00:17:27,280 --> 00:17:32,280 Speaker 13: as it also wants to recognize Crimea as legally Russian, 321 00:17:32,600 --> 00:17:35,680 Speaker 13: and this I think it's worth reminding our audience. Back 322 00:17:35,720 --> 00:17:38,640 Speaker 13: in twenty eighteen, when Donald Trump was president the first time, 323 00:17:39,000 --> 00:17:42,159 Speaker 13: the State Department issued something called the Crimea Declaration, and 324 00:17:42,200 --> 00:17:46,000 Speaker 13: it said that we will never ever recognize the use 325 00:17:46,040 --> 00:17:49,560 Speaker 13: of force to take to take territory, that this is 326 00:17:49,600 --> 00:17:52,320 Speaker 13: illegal under international law. So if you go back to 327 00:17:52,359 --> 00:17:55,960 Speaker 13: Donald Trump's first administration, the policy that they're trying to 328 00:17:56,000 --> 00:17:59,640 Speaker 13: push now is not very consistent. I mean, look, it's politics. 329 00:17:59,680 --> 00:18:02,240 Speaker 13: No one's very consistent, but it's worth pointing out that 330 00:18:02,800 --> 00:18:06,160 Speaker 13: they're in a very different position. So I don't think 331 00:18:06,720 --> 00:18:08,879 Speaker 13: Zelensky is willing to concede some territory. 332 00:18:09,040 --> 00:18:10,600 Speaker 12: I think he understands he has to. 333 00:18:10,840 --> 00:18:13,919 Speaker 13: But the real issue is there's no security guarantees, and 334 00:18:14,000 --> 00:18:16,840 Speaker 13: the US is unwilling to give them security guarantees, and 335 00:18:16,880 --> 00:18:19,600 Speaker 13: the British government has said that it must have a 336 00:18:19,760 --> 00:18:23,119 Speaker 13: US backstop. So we're sort of stuck. We're very stuck. 337 00:18:23,280 --> 00:18:25,800 Speaker 13: But there's a bigger issue that I'm really worried about. 338 00:18:25,960 --> 00:18:29,920 Speaker 13: So when Donald Trump and JD. Vance say we're. 339 00:18:29,680 --> 00:18:31,679 Speaker 12: Pulling out, I want to know what that means. 340 00:18:31,720 --> 00:18:33,720 Speaker 13: Does that mean we're not going to participate in the 341 00:18:33,720 --> 00:18:36,520 Speaker 13: process or does that mean we're not going to cooperate 342 00:18:36,560 --> 00:18:39,439 Speaker 13: with intelligence sharing and we're not going to allow Europe 343 00:18:39,440 --> 00:18:39,920 Speaker 13: to buy. 344 00:18:39,760 --> 00:18:41,040 Speaker 12: Weapons for Ukraine. 345 00:18:41,480 --> 00:18:45,040 Speaker 13: If it's the second, Ukraine is in a really hard spot. 346 00:18:45,400 --> 00:18:47,880 Speaker 13: If it's we're not going to participate in the negotiations, 347 00:18:47,920 --> 00:18:48,919 Speaker 13: I'm a lot less worried. 348 00:18:50,160 --> 00:18:53,960 Speaker 2: Interesting in the end, though, Melinda, you've been talking to 349 00:18:54,040 --> 00:18:58,040 Speaker 2: us since before the invasion actually took place. Every wrinkle 350 00:18:58,119 --> 00:19:00,080 Speaker 2: we've had a chance to get your analysis to do 351 00:19:00,119 --> 00:19:01,880 Speaker 2: you see any world in which there is a peace 352 00:19:01,960 --> 00:19:07,040 Speaker 2: deal struck that does not favor Russia. 353 00:19:07,280 --> 00:19:09,840 Speaker 12: So I think it depends on the facts on the ground. 354 00:19:10,000 --> 00:19:14,159 Speaker 13: But Ukraine is not going to agree to anything, Joe, 355 00:19:14,320 --> 00:19:17,280 Speaker 13: unless there's some kind of security agreement to ensure that 356 00:19:17,359 --> 00:19:21,200 Speaker 13: Russia doesn't come back. So right now, Russia occupies twenty 357 00:19:21,320 --> 00:19:24,679 Speaker 13: percent of Ukraine and they're likely going to have to 358 00:19:24,680 --> 00:19:25,840 Speaker 13: give up some territory. 359 00:19:26,080 --> 00:19:26,880 Speaker 12: But when I talk to. 360 00:19:26,840 --> 00:19:29,240 Speaker 13: Medics on the front line, Joe, they tell me that 361 00:19:29,280 --> 00:19:33,800 Speaker 13: we are totally committed to defending Ukraine even if the 362 00:19:34,119 --> 00:19:36,880 Speaker 13: US is not there. So the mood in Ukraine has 363 00:19:36,960 --> 00:19:39,359 Speaker 13: not changed. But I don't think the situation is ripe 364 00:19:39,359 --> 00:19:41,119 Speaker 13: for negotiations at this point. 365 00:19:42,400 --> 00:19:44,480 Speaker 10: Well, Melinda, I want to return to your point about 366 00:19:44,840 --> 00:19:47,679 Speaker 10: kind of characterizing what walking away actually means for the 367 00:19:47,760 --> 00:19:50,119 Speaker 10: United States. If it were to be just, we are 368 00:19:50,160 --> 00:19:54,080 Speaker 10: removing ourselves as a third party in these negotiations, leaving 369 00:19:54,119 --> 00:19:57,200 Speaker 10: it for either other countries to mediate or Ukraine and 370 00:19:57,240 --> 00:20:00,240 Speaker 10: Russia to sort this out among themselves. With that actually 371 00:20:00,240 --> 00:20:03,400 Speaker 10: make it easier for the Ukrainians or does that make 372 00:20:03,440 --> 00:20:05,800 Speaker 10: the whole thing more difficult because Vladimir Putin may not 373 00:20:05,840 --> 00:20:10,879 Speaker 10: want to go ahead or essentially take this directly to Zelensky. 374 00:20:12,119 --> 00:20:15,240 Speaker 13: So the negotiating format is a little bit difficult, Kaylee. 375 00:20:15,480 --> 00:20:17,520 Speaker 12: So right now Putin. 376 00:20:17,320 --> 00:20:19,480 Speaker 13: Is saying that he's willing to meet with Zolensky, and 377 00:20:19,520 --> 00:20:22,400 Speaker 13: Zelensky has said before I will not meet with him directly, 378 00:20:22,440 --> 00:20:25,480 Speaker 13: that there has to be an intermediary. Zelensky is now saying, 379 00:20:25,520 --> 00:20:28,200 Speaker 13: I'm willing to consider all formats, but you have to 380 00:20:28,240 --> 00:20:29,560 Speaker 13: stop killing civilians. 381 00:20:29,960 --> 00:20:33,560 Speaker 12: And that's one of the difficulties is Russia. 382 00:20:33,200 --> 00:20:36,159 Speaker 13: Has not stopped its missile strikes, so that is a 383 00:20:36,200 --> 00:20:40,119 Speaker 13: prerequisite for any kind of negotiation. To your bigger point, though, 384 00:20:40,440 --> 00:20:42,879 Speaker 13: if the US were to step back from being the 385 00:20:42,960 --> 00:20:46,840 Speaker 13: lead negotiator. I think it's not the end of the world. 386 00:20:46,840 --> 00:20:49,000 Speaker 13: I think Britain could take that place. I think the 387 00:20:49,040 --> 00:20:51,760 Speaker 13: Turkey would be interested in taking that place. I think 388 00:20:51,800 --> 00:20:54,480 Speaker 13: there's some Middle Eastern governments that might be willing to 389 00:20:54,520 --> 00:20:55,320 Speaker 13: take that place. 390 00:20:55,800 --> 00:20:59,760 Speaker 12: And Ukraine doesn't see Washington as a neutral actor at 391 00:20:59,760 --> 00:21:00,320 Speaker 12: this point. 392 00:21:00,400 --> 00:21:03,760 Speaker 13: They every one of the positions that they've been pushing 393 00:21:03,760 --> 00:21:08,320 Speaker 13: in these negotiations is seen from Kiev as is something 394 00:21:08,359 --> 00:21:10,960 Speaker 13: that doesn't favor them. So I don't think it's a 395 00:21:11,080 --> 00:21:14,119 Speaker 13: terrible thing if Washington walks away from the negotiations. 396 00:21:15,240 --> 00:21:17,480 Speaker 2: There was a time a Linda when peace appeared to 397 00:21:17,560 --> 00:21:21,080 Speaker 2: Hinge on the signing of a minerals deal, remembering Scott 398 00:21:21,160 --> 00:21:24,560 Speaker 2: Besson's ill fated trip to Kiev. We're still, according to 399 00:21:24,560 --> 00:21:28,080 Speaker 2: President Trump, expecting something to happen. Here's what he said 400 00:21:28,320 --> 00:21:31,199 Speaker 2: about a minerals deal potentially happening this week. 401 00:21:31,640 --> 00:21:33,679 Speaker 14: We have a minerals deal, which I guess is going 402 00:21:33,720 --> 00:21:38,360 Speaker 14: to be signed on Thursday, Scott next Thursday soon, and 403 00:21:38,800 --> 00:21:40,440 Speaker 14: I assume they're going to live up to the deal, 404 00:21:40,520 --> 00:21:45,080 Speaker 14: so we'll see that we have a deal on that. No, 405 00:21:45,160 --> 00:21:46,199 Speaker 14: I have no comment on that. 406 00:21:46,320 --> 00:21:47,000 Speaker 9: I have no idea. 407 00:21:47,359 --> 00:21:49,320 Speaker 14: That's his statement of mind. 408 00:21:50,520 --> 00:21:53,680 Speaker 2: All right, So that was last Thursday, Melinda. Will it still. 409 00:21:53,480 --> 00:21:57,239 Speaker 13: Happen, Joe, I don't know. I've been poking around on this. 410 00:21:57,480 --> 00:22:00,000 Speaker 13: The expectation is that it was going to be signed tomorrow. 411 00:22:00,000 --> 00:22:03,240 Speaker 13: So that was five days ago where the initial agreement 412 00:22:03,440 --> 00:22:06,920 Speaker 13: was signed between the United States and Ukraine, and it's 413 00:22:06,960 --> 00:22:10,280 Speaker 13: an eighty page document. The details of that document haven't 414 00:22:10,320 --> 00:22:13,720 Speaker 13: been released yet. But what's interesting is that this seven 415 00:22:13,800 --> 00:22:17,640 Speaker 13: point negotiating document that the United States gave Ukraine, one 416 00:22:17,640 --> 00:22:20,080 Speaker 13: of the points was the mineral deal. So it seems 417 00:22:20,119 --> 00:22:23,919 Speaker 13: like the mineral deal is contingent on Ukraine going along 418 00:22:23,960 --> 00:22:28,120 Speaker 13: with this bigger plan that President Trump and Vice President 419 00:22:28,200 --> 00:22:31,800 Speaker 13: Vance had envisioned. So I think it looks like it's 420 00:22:31,840 --> 00:22:34,439 Speaker 13: in trouble, but let's watch and see. 421 00:22:36,640 --> 00:22:40,080 Speaker 10: Well, we certainly will be on watch tomorrow to see 422 00:22:40,080 --> 00:22:42,160 Speaker 10: whether or not this deal ultimately assigned or if there's 423 00:22:42,160 --> 00:22:44,080 Speaker 10: any progress toward it in the first place. But the 424 00:22:44,080 --> 00:22:47,160 Speaker 10: original basis for it, Melinda, was that having an economic 425 00:22:47,200 --> 00:22:51,160 Speaker 10: incentive or economic interest in Ukraine would be some kind 426 00:22:51,240 --> 00:22:55,560 Speaker 10: of security guarantee. And obviously we've discussed that thoroughly with 427 00:22:55,600 --> 00:22:57,399 Speaker 10: you in the absence of a deal being signed in 428 00:22:57,440 --> 00:22:59,280 Speaker 10: the US, still not being willing to pony up on 429 00:22:59,320 --> 00:23:03,959 Speaker 10: any other kind of security guarantees. What position does that 430 00:23:04,000 --> 00:23:07,120 Speaker 10: realistically leave Ukraine? And I'm just trying to consider their 431 00:23:07,160 --> 00:23:09,160 Speaker 10: position here as they decide whether or not to sign 432 00:23:09,200 --> 00:23:10,160 Speaker 10: on the dotted line. 433 00:23:11,400 --> 00:23:15,080 Speaker 13: Right, So Ukraine is going to put increasing pressure on 434 00:23:15,320 --> 00:23:19,320 Speaker 13: European government's London in particular, to make good on the 435 00:23:19,359 --> 00:23:22,000 Speaker 13: commitment to put troops on the ground and provide some 436 00:23:22,080 --> 00:23:25,680 Speaker 13: kind of security backstop without Washington. I think that's where 437 00:23:25,680 --> 00:23:29,280 Speaker 13: we're going next. And I wasn't privy to the discussions today. 438 00:23:29,320 --> 00:23:32,479 Speaker 13: I'm sure that was discussed in London, and I think 439 00:23:32,520 --> 00:23:36,200 Speaker 13: they'll be increasing pressure on Ukraine's other friends in Asia 440 00:23:36,280 --> 00:23:38,920 Speaker 13: and in other parts of the world to deliver military 441 00:23:39,000 --> 00:23:40,800 Speaker 13: kits so that Ukraine can stay in the fight and 442 00:23:40,840 --> 00:23:41,680 Speaker 13: defend itself. 443 00:23:42,920 --> 00:23:45,720 Speaker 2: Was this always the direction we were going in here, Melinda, 444 00:23:45,760 --> 00:23:48,040 Speaker 2: We're just kind of getting to the reality of the 445 00:23:48,080 --> 00:23:50,640 Speaker 2: matter now, or did that meeting in the Oval Office 446 00:23:51,240 --> 00:23:55,680 Speaker 2: send things off the rails and potentially permanently for President Zelensky. 447 00:23:57,480 --> 00:23:57,680 Speaker 4: Joe. 448 00:23:57,720 --> 00:23:58,720 Speaker 12: It's a great question. 449 00:23:59,400 --> 00:24:01,760 Speaker 13: I've been told that President Trump was actually in a 450 00:24:01,800 --> 00:24:05,600 Speaker 13: good mood and wanted progress in the relationship that day, 451 00:24:06,560 --> 00:24:10,720 Speaker 13: and we still don't know why it was spiked. I 452 00:24:10,760 --> 00:24:14,200 Speaker 13: think it's possible that Donald Trump. Look, never say never 453 00:24:14,240 --> 00:24:17,280 Speaker 13: with Donald Trump, right, It's possible he'll wake up tomorrow 454 00:24:17,359 --> 00:24:21,560 Speaker 13: and say I'm fed up with Vladimir Putin. He's unwilling 455 00:24:21,600 --> 00:24:23,800 Speaker 13: to move I don't see it happening though. At this point. 456 00:24:24,680 --> 00:24:27,240 Speaker 13: I think that Donald Trump wanted an easy deal. This 457 00:24:27,280 --> 00:24:29,560 Speaker 13: is not going to be an easy deal, and I 458 00:24:29,560 --> 00:24:34,160 Speaker 13: think he's going to move on. Unfortunately for forty million Ukrainians. 459 00:24:34,720 --> 00:24:35,080 Speaker 2: Wow. 460 00:24:35,400 --> 00:24:38,240 Speaker 10: Wow, So Steve Witkoff as he gets ready to head 461 00:24:38,240 --> 00:24:40,560 Speaker 10: to Moscow and Vladimir Putin has no real hope of 462 00:24:40,600 --> 00:24:42,480 Speaker 10: success in your mind, Melinda. 463 00:24:43,480 --> 00:24:46,359 Speaker 13: Look, you can't force the Ukrainians to sign a deal 464 00:24:46,600 --> 00:24:50,440 Speaker 13: that they won't bring them lasting security. So I don't 465 00:24:50,440 --> 00:24:53,560 Speaker 13: see how this deal goes forward. This is Witkoff's fourth trip, 466 00:24:54,320 --> 00:24:59,040 Speaker 13: and you know, I think they're going to discuss the peculiarities. 467 00:24:58,119 --> 00:24:58,880 Speaker 12: Of this agreement. 468 00:24:59,119 --> 00:25:03,520 Speaker 13: But Zelensky's already come out and said that accepting this 469 00:25:03,640 --> 00:25:07,080 Speaker 13: agreement would violate the constitution of Ukraine and no president 470 00:25:07,080 --> 00:25:07,640 Speaker 13: could do it. 471 00:25:09,040 --> 00:25:13,520 Speaker 2: M Well, Melinda, I'm not sure what happens from here. 472 00:25:13,600 --> 00:25:15,760 Speaker 2: What signs should we be watching for. Is it a 473 00:25:15,800 --> 00:25:19,320 Speaker 2: meeting that includes Marco Rubio and Witkoff that would get 474 00:25:19,320 --> 00:25:21,520 Speaker 2: your attention? What are you going to see that you 475 00:25:21,600 --> 00:25:22,520 Speaker 2: might take seriously. 476 00:25:24,200 --> 00:25:27,080 Speaker 13: I'm going to be watching the battlefield that my eyes 477 00:25:27,240 --> 00:25:29,800 Speaker 13: ensumi in northern Ukraine. I want to I want to 478 00:25:29,800 --> 00:25:32,600 Speaker 13: see what the Russians are doing there, and I'm going 479 00:25:32,680 --> 00:25:35,960 Speaker 13: to continue to watch and see. There's some interesting reports 480 00:25:35,960 --> 00:25:40,600 Speaker 13: that North Korea is also sending workers to Russia, Joe, 481 00:25:40,640 --> 00:25:43,560 Speaker 13: which indicates that Russia doesn't have enough people to be 482 00:25:43,640 --> 00:25:45,000 Speaker 13: fueling it's. 483 00:25:44,720 --> 00:25:46,000 Speaker 12: It's it's economy. 484 00:25:46,119 --> 00:25:50,000 Speaker 13: So uh, I'm not I don't think much is going 485 00:25:50,080 --> 00:25:52,520 Speaker 13: to happen on the high level negotiations, but the real 486 00:25:52,520 --> 00:25:55,879 Speaker 13: issue is the security guarantees and also the production of 487 00:25:55,960 --> 00:25:57,040 Speaker 13: weapons in Europe. 488 00:25:57,040 --> 00:26:00,000 Speaker 12: So watch that space, all right. 489 00:26:00,080 --> 00:26:01,720 Speaker 10: We will be and we trust you will be as well, 490 00:26:01,760 --> 00:26:04,439 Speaker 10: and continue to come back and share your insights with us. 491 00:26:04,480 --> 00:26:07,840 Speaker 10: Melinda Herring, Senior Fellow at the Atlanta Council's Eurasia Center. 492 00:26:07,920 --> 00:26:10,040 Speaker 10: Joining us here on Bloomberg TV and radio. 493 00:26:12,400 --> 00:26:15,880 Speaker 1: You're listening to the Bloomberg Balance of Power podcast. Catch 494 00:26:15,920 --> 00:26:19,000 Speaker 1: us live weekdays at noon and five pm Eastern on 495 00:26:19,119 --> 00:26:22,359 Speaker 1: Apple Cocklay and Android Auto with the Bloomberg Business app. 496 00:26:22,400 --> 00:26:25,399 Speaker 1: You can also listen live on Amazon Alexa from our 497 00:26:25,440 --> 00:26:29,920 Speaker 1: flagship New York station, Just say Alexa, play Bloomberg eleven. 498 00:26:29,680 --> 00:26:35,520 Speaker 2: Thirty watching stocks rise today, including Tesla. Charlie's been checking 499 00:26:35,560 --> 00:26:38,480 Speaker 2: Tesla for a couple of reasons here, and it brings 500 00:26:38,560 --> 00:26:40,360 Speaker 2: us back to the late edition of Balance of Power 501 00:26:40,480 --> 00:26:43,520 Speaker 2: right after the bell yesterday. Worst quarter in years was 502 00:26:43,560 --> 00:26:47,200 Speaker 2: the headline, look at the stock up six percent, fourteen 503 00:26:47,320 --> 00:26:50,520 Speaker 2: dollars back above two hundred and fifty because it looks 504 00:26:50,600 --> 00:26:53,760 Speaker 2: like they're going to get Elon back. Yeah, that's the 505 00:26:53,840 --> 00:26:56,640 Speaker 2: story that we're following here in Washington. Of course, we've 506 00:26:56,640 --> 00:27:00,159 Speaker 2: talked so much about his work at the DOGE with 507 00:27:00,200 --> 00:27:04,120 Speaker 2: another headline, must to refocus on Tesla after its worst 508 00:27:04,200 --> 00:27:05,919 Speaker 2: quarter in years. And you know, we've been looking at 509 00:27:05,920 --> 00:27:08,680 Speaker 2: the end of May here if you listen to this program, remembering, 510 00:27:08,680 --> 00:27:10,520 Speaker 2: of course, that that's the deal one hundred and thirty 511 00:27:10,600 --> 00:27:13,400 Speaker 2: day limit. I guess unless they re up this deal 512 00:27:13,480 --> 00:27:16,240 Speaker 2: his role as a special government employee, that would kind 513 00:27:16,240 --> 00:27:18,520 Speaker 2: of round things out by the end of May. My 514 00:27:18,600 --> 00:27:22,359 Speaker 2: only real question is does he get to keep the chainsaw. 515 00:27:23,680 --> 00:27:26,560 Speaker 2: Elon Musk did speak to investors on the quarterly conference 516 00:27:26,600 --> 00:27:28,200 Speaker 2: call following the results last evening. 517 00:27:28,200 --> 00:27:33,880 Speaker 15: Listen, starting probably an ex month may my time allocation 518 00:27:34,359 --> 00:27:38,160 Speaker 15: to dogs will drop significantly. I'll have to continue doing 519 00:27:38,200 --> 00:27:41,240 Speaker 15: it for I think fight the remainder of the president's term. 520 00:27:41,520 --> 00:27:43,400 Speaker 15: Just make sure that the waste and fraud that we 521 00:27:43,680 --> 00:27:45,440 Speaker 15: stop does not come roaring back. 522 00:27:47,000 --> 00:27:53,320 Speaker 2: He called his work at the Doge quote mostly done, unquote, 523 00:27:53,480 --> 00:27:56,919 Speaker 2: raising a whole new load of questions here inside the 524 00:27:56,960 --> 00:28:00,720 Speaker 2: beltwagh about what exactly the Doge has a complied Elon 525 00:28:00,840 --> 00:28:05,280 Speaker 2: Musk promising in the outset to cut two trillion dollars 526 00:28:05,320 --> 00:28:09,159 Speaker 2: in spending, waste, fraud, and abuse, and it might not 527 00:28:09,240 --> 00:28:11,879 Speaker 2: come anywhere near that number, although we're going to be 528 00:28:11,880 --> 00:28:14,560 Speaker 2: talking a lot more about recisions when lawmakers get back 529 00:28:14,600 --> 00:28:17,720 Speaker 2: to town, and you can park that here for a moment. 530 00:28:18,200 --> 00:28:20,199 Speaker 2: It's not very often I get to spend time with 531 00:28:20,440 --> 00:28:23,760 Speaker 2: Ed Ludlow. It's usually a big deal involving a rocket launch. 532 00:28:23,800 --> 00:28:26,560 Speaker 2: So that should tell you how important this story is. Today. 533 00:28:26,600 --> 00:28:28,920 Speaker 2: He's with us from our bureau in San Francisco. Of course, 534 00:28:28,960 --> 00:28:32,720 Speaker 2: the cohost of Bloomberg Technology or Elon whisperer at the moment, 535 00:28:32,760 --> 00:28:34,760 Speaker 2: and it's great to see you and I appreciate this. 536 00:28:34,760 --> 00:28:38,440 Speaker 2: This is really what investors we're looking for. Does Elon 537 00:28:38,560 --> 00:28:41,040 Speaker 2: Musk mean it is he going to be showing up 538 00:28:41,520 --> 00:28:44,480 Speaker 2: at the Tesla plant? What's his new life going to 539 00:28:44,560 --> 00:28:45,760 Speaker 2: be like the one he used to lead? 540 00:28:46,600 --> 00:28:49,440 Speaker 16: I mean that's a pretty good summary. It was the 541 00:28:49,480 --> 00:28:51,080 Speaker 16: only metric that mattered. 542 00:28:51,160 --> 00:28:51,320 Speaker 9: You know. 543 00:28:51,360 --> 00:28:53,360 Speaker 16: We asked going into the earnings print, how do you 544 00:28:53,480 --> 00:28:56,760 Speaker 16: gauge someone's commitment to something? And he opened the cool 545 00:28:56,960 --> 00:29:01,080 Speaker 16: saying exactly that as of next month May, he will 546 00:29:01,480 --> 00:29:04,640 Speaker 16: drop the amount of time that he spends with Doge 547 00:29:05,240 --> 00:29:07,000 Speaker 16: and boost the allocation of. 548 00:29:06,920 --> 00:29:07,680 Speaker 6: Time for Tesla. 549 00:29:07,760 --> 00:29:10,280 Speaker 16: But you make a really good point, which is, depending 550 00:29:10,320 --> 00:29:12,960 Speaker 16: on who you asked, this was or wasn't a surprise, right. 551 00:29:13,000 --> 00:29:15,640 Speaker 16: We've known for quite a long time that a special 552 00:29:15,680 --> 00:29:18,160 Speaker 16: government employee has a one hundred and thirty day limit 553 00:29:18,400 --> 00:29:21,920 Speaker 16: on their contributions, even if they're unpaid, and we've all 554 00:29:21,920 --> 00:29:23,920 Speaker 16: been looking at the calendar and thinking what happens at 555 00:29:23,920 --> 00:29:27,440 Speaker 16: the end of May. But it's just sort of the 556 00:29:27,480 --> 00:29:30,800 Speaker 16: public coming out and saying, don't worry, I'm coming back 557 00:29:30,840 --> 00:29:33,600 Speaker 16: to Tesla and I'm focused on the big picture. 558 00:29:33,280 --> 00:29:37,960 Speaker 2: Stuff, fascinating what happened to the company in this quarter? 559 00:29:38,200 --> 00:29:40,360 Speaker 2: Ed and how much did politics have to do with it? 560 00:29:40,720 --> 00:29:42,880 Speaker 6: Yeah, there's a lot of politics to discuss. 561 00:29:43,040 --> 00:29:46,520 Speaker 16: I mean, there were contradictions between the statements that Elon 562 00:29:46,640 --> 00:29:49,440 Speaker 16: Musk made on the earnings call and the statements made 563 00:29:49,480 --> 00:29:53,760 Speaker 16: by his CFO. The CFO quite clearly addressed the issue 564 00:29:53,760 --> 00:29:56,640 Speaker 16: that in the first quarter there is what he referred 565 00:29:56,640 --> 00:30:01,280 Speaker 16: to as brand damage and vandalism that impact first quarter sales. 566 00:30:01,360 --> 00:30:05,040 Speaker 16: Elon Musk opened his remarks just before he kind of 567 00:30:05,040 --> 00:30:07,840 Speaker 16: announced he would step back from doage, saying he recognized 568 00:30:07,840 --> 00:30:11,560 Speaker 16: a backlash. So, and what's interesting is that there's more 569 00:30:11,600 --> 00:30:15,000 Speaker 16: than just about the United States here. You know, there's 570 00:30:15,040 --> 00:30:16,720 Speaker 16: a lot of evidence that we have protests in the 571 00:30:16,760 --> 00:30:20,800 Speaker 16: United States. Elon Musk made unsubstantiated claims that they were 572 00:30:20,840 --> 00:30:23,400 Speaker 16: sort of a targeted and paid for campaign against him, 573 00:30:23,640 --> 00:30:26,920 Speaker 16: and that has impacted Tesla's sales. But the politics extends 574 00:30:26,920 --> 00:30:30,040 Speaker 16: to China right where Tesla is under pressure from domestic 575 00:30:30,040 --> 00:30:33,080 Speaker 16: players in China. And if you're a Chinese national, would 576 00:30:33,160 --> 00:30:36,160 Speaker 16: you buy a Tesla or champion your own domestic brand? 577 00:30:36,240 --> 00:30:36,640 Speaker 6: Right now? 578 00:30:36,640 --> 00:30:40,000 Speaker 16: Knowing that Elon Musk is an associate of President Trump 579 00:30:40,000 --> 00:30:43,200 Speaker 16: in this in this trade scenario, you. 580 00:30:43,120 --> 00:30:45,800 Speaker 2: Know, you see poles ed. You've been in business news 581 00:30:45,800 --> 00:30:48,960 Speaker 2: long enough, you see poles. What brand association people have, 582 00:30:49,040 --> 00:30:50,960 Speaker 2: whether they're from the left or the right. They've got 583 00:30:50,960 --> 00:30:53,200 Speaker 2: their own beer, They've got their own car. In this case, 584 00:30:53,400 --> 00:30:55,520 Speaker 2: they've really got their own car. But to watch that 585 00:30:56,000 --> 00:30:59,400 Speaker 2: transition from being a darling on the left right with 586 00:30:59,560 --> 00:31:03,320 Speaker 2: making the the most successful ev ever made in this country, 587 00:31:04,160 --> 00:31:08,400 Speaker 2: to the complete political opposite makes you wonder how much 588 00:31:08,440 --> 00:31:09,880 Speaker 2: permanent damage is done here. 589 00:31:10,760 --> 00:31:13,760 Speaker 6: Yeah, and it's hard to quantify, I mean within the data. 590 00:31:13,800 --> 00:31:16,160 Speaker 16: There is also a debate about whether the softness in 591 00:31:16,200 --> 00:31:20,600 Speaker 16: the first quarter reflected Americans who were existing Tesla owners 592 00:31:20,640 --> 00:31:24,400 Speaker 16: and have become disgruntled or disenfranchised with Elon Musk, or 593 00:31:24,440 --> 00:31:28,720 Speaker 16: whether Elon Musk's profile and relationship with government was holding 594 00:31:28,760 --> 00:31:30,760 Speaker 16: off first time buyers of a Tesla product. We just 595 00:31:30,800 --> 00:31:34,040 Speaker 16: don't know, but it's an excellent question. I think what 596 00:31:34,160 --> 00:31:37,040 Speaker 16: was also so interesting is just the tariff's debate. You know, 597 00:31:37,120 --> 00:31:40,000 Speaker 16: Elon Musk is closely aligned with the President, as you know, 598 00:31:40,560 --> 00:31:42,800 Speaker 16: but he did say I don't believe in high levels 599 00:31:42,840 --> 00:31:45,800 Speaker 16: of tariffs I believe in low tariffs, and I advocated 600 00:31:45,840 --> 00:31:47,720 Speaker 16: that position to the president, but it's not up to me. 601 00:31:47,760 --> 00:31:50,200 Speaker 16: It's up to the president. And in the context of 602 00:31:50,200 --> 00:31:55,560 Speaker 16: an earning school, that's not unprecedented, but a little bit surprising, right, It's. 603 00:31:55,360 --> 00:31:58,800 Speaker 6: Something that doesn't happen in the daily course of my job. Yeah. 604 00:31:58,960 --> 00:32:01,320 Speaker 2: No, that was fascinting and I wonder ed if that 605 00:32:01,440 --> 00:32:03,440 Speaker 2: was the breaking point. I'm not sure we'll ever know, 606 00:32:04,320 --> 00:32:07,360 Speaker 2: but was it the political tug to have to get 607 00:32:07,360 --> 00:32:09,480 Speaker 2: back to and of course the investor tug to get 608 00:32:09,520 --> 00:32:11,920 Speaker 2: back to the company to get the stock moving again, 609 00:32:11,960 --> 00:32:14,720 Speaker 2: to have a better story to tell at Tesla, Or 610 00:32:14,760 --> 00:32:16,520 Speaker 2: was it, Hey, you know what, I don't believe in 611 00:32:16,560 --> 00:32:18,840 Speaker 2: tariff So I think maybe our work here is done. 612 00:32:20,200 --> 00:32:21,160 Speaker 6: In any company. 613 00:32:21,360 --> 00:32:23,640 Speaker 16: It's not just the CEO, right, And in any company 614 00:32:23,720 --> 00:32:27,600 Speaker 16: earnings the literal statement, the report and the call, the 615 00:32:27,720 --> 00:32:30,240 Speaker 16: IR team is involved, the legal team is involved, in 616 00:32:30,280 --> 00:32:33,040 Speaker 16: the CFO is involved, and it's said very clearly in 617 00:32:33,080 --> 00:32:37,200 Speaker 16: the earnings deck that the company recognizes a changing political 618 00:32:37,280 --> 00:32:42,240 Speaker 16: landscape without defining geographically where it recognized it, and an 619 00:32:42,280 --> 00:32:47,240 Speaker 16: evolving trade policy and they're all impacted by that. And 620 00:32:47,280 --> 00:32:50,000 Speaker 16: it was a big moment where you know, we know 621 00:32:50,120 --> 00:32:53,240 Speaker 16: about the disagreements within the cabinet, Musk and Peter Navarro 622 00:32:53,440 --> 00:32:56,200 Speaker 16: not necessarily getting on. But this was a company in 623 00:32:56,280 --> 00:32:59,920 Speaker 16: regulatory filings recognizing what's happening around the world right now. 624 00:33:00,640 --> 00:33:03,880 Speaker 16: And while Tesla is more insulated than other American companies 625 00:33:04,040 --> 00:33:07,120 Speaker 16: because it has a very onshore vertically integrated supply chain, 626 00:33:07,720 --> 00:33:11,120 Speaker 16: it basically said this isn't good for us, and our 627 00:33:11,200 --> 00:33:14,400 Speaker 16: opinion on it is this, and that was an important moment. 628 00:33:14,480 --> 00:33:17,320 Speaker 16: It was an indirect message to this administration. I think 629 00:33:17,360 --> 00:33:18,480 Speaker 16: that's a fair interpretation. 630 00:33:19,640 --> 00:33:21,920 Speaker 2: Tell me about the man ed before I ask you 631 00:33:21,960 --> 00:33:23,760 Speaker 2: about some other stuff that I wanted to talk to 632 00:33:23,800 --> 00:33:27,080 Speaker 2: you about. Much has been said about Elon Musk's lifestyle, 633 00:33:27,120 --> 00:33:28,560 Speaker 2: and there have been a lot of questions about the 634 00:33:28,600 --> 00:33:31,440 Speaker 2: stress levels he's been under. He talked about how difficult 635 00:33:31,480 --> 00:33:32,960 Speaker 2: it's been trying to do all of this. There have 636 00:33:32,960 --> 00:33:35,800 Speaker 2: been questions about his sobriety. There have been questions about, 637 00:33:35,840 --> 00:33:39,000 Speaker 2: my gosh, this piece about all the kids and the 638 00:33:39,400 --> 00:33:41,920 Speaker 2: mothers that he's dealing with, is he well. 639 00:33:43,320 --> 00:33:46,320 Speaker 16: Elon Musk has the lifestyle of someone that is atypical 640 00:33:46,360 --> 00:33:48,640 Speaker 16: for the everyday person. He is on and off the 641 00:33:48,720 --> 00:33:52,000 Speaker 16: world's richest person you know as an understatement. Look, I 642 00:33:52,040 --> 00:33:54,040 Speaker 16: know a lot of people that have worked for and 643 00:33:54,040 --> 00:33:56,120 Speaker 16: with Elon Musk across all of his companies for a 644 00:33:56,120 --> 00:33:59,400 Speaker 16: really long time. He is a micro manager. He likes 645 00:33:59,440 --> 00:34:01,520 Speaker 16: to make decison, he likes to be told tell me 646 00:34:01,560 --> 00:34:03,800 Speaker 16: why I am wrong. He spends a lot of time 647 00:34:03,840 --> 00:34:07,320 Speaker 16: on private jets working off of his cell phone. But 648 00:34:07,600 --> 00:34:10,480 Speaker 16: the story has been has he been too focused on 649 00:34:10,560 --> 00:34:13,400 Speaker 16: DOJE and been operating in Mari Lago and DC too 650 00:34:13,480 --> 00:34:18,160 Speaker 16: much relative to Tesla's facilities. But he's also credited with 651 00:34:18,239 --> 00:34:21,239 Speaker 16: some of the biggest technological breakthroughs that humankind's seen in 652 00:34:21,280 --> 00:34:26,160 Speaker 16: the domain of energy, EV's rocket Tree. And I think 653 00:34:26,160 --> 00:34:28,839 Speaker 16: that this whole debate was about that he's good at 654 00:34:28,840 --> 00:34:31,399 Speaker 16: that stuff, so if he focused more on it, then 655 00:34:31,440 --> 00:34:34,879 Speaker 16: there might be progress in those fields. And it's also 656 00:34:34,960 --> 00:34:38,040 Speaker 16: important to reflect that lots of times Elon Musk makes 657 00:34:38,080 --> 00:34:41,080 Speaker 16: bold predictions and timelines that he gets the timing wrong, 658 00:34:41,320 --> 00:34:43,440 Speaker 16: but he does often get there in the end with 659 00:34:43,520 --> 00:34:44,960 Speaker 16: a product or whatever that right. 660 00:34:45,880 --> 00:34:49,520 Speaker 2: Fascinating story. As we got our hooks into Ed Ludlow, 661 00:34:49,560 --> 00:34:51,640 Speaker 2: I need to ask you about Intel. It's an important 662 00:34:51,640 --> 00:34:55,000 Speaker 2: headline plans this week to cut over twenty percent of 663 00:34:55,040 --> 00:34:58,040 Speaker 2: its staff. I'm sitting in Washington, you're in San Francisco. 664 00:34:58,120 --> 00:35:00,400 Speaker 2: So the question I'm supposed to ask you is, did 665 00:35:00,480 --> 00:35:05,120 Speaker 2: Joe Biden? Did the Biden administration pick the wrong company? 666 00:35:05,239 --> 00:35:08,399 Speaker 16: Yeah, you'd think that the Intel would be the national champion, right. 667 00:35:08,440 --> 00:35:11,480 Speaker 16: It is both a designer of semiconductor products and a 668 00:35:11,520 --> 00:35:15,799 Speaker 16: manufacturer of them, a domestic manufacturer, and Intel's been very 669 00:35:15,800 --> 00:35:18,520 Speaker 16: frustrated with the CHIPSAC because the money has not really 670 00:35:18,520 --> 00:35:22,160 Speaker 16: been forthcoming. The intended impact of it's not yet happened. 671 00:35:22,360 --> 00:35:25,239 Speaker 16: What we're reporting is that they're cutting twenty percent. But 672 00:35:25,320 --> 00:35:28,320 Speaker 16: it's not just about bloat. It's about kind of getting 673 00:35:28,360 --> 00:35:31,239 Speaker 16: focused on technology. There are lots of middle managers at 674 00:35:31,239 --> 00:35:34,279 Speaker 16: Intel that are involved in making decisions that mean good 675 00:35:34,320 --> 00:35:37,600 Speaker 16: decisions don't happen, and Intel is trying to find a 676 00:35:37,640 --> 00:35:40,080 Speaker 16: way to kind of get back to their heritage, which 677 00:35:40,120 --> 00:35:42,959 Speaker 16: is being the leader in the field of semiconductor manufacturing 678 00:35:43,160 --> 00:35:46,920 Speaker 16: at the cutting edge of technology. What they want to 679 00:35:46,960 --> 00:35:48,800 Speaker 16: do is very much in line with the Trump administration 680 00:35:48,840 --> 00:35:51,560 Speaker 16: wants to do with onshoring manufacturing, and so I'm so 681 00:35:51,680 --> 00:35:54,440 Speaker 16: curious to hear when they report numbers, has anyone from 682 00:35:54,440 --> 00:35:56,960 Speaker 16: the administration phoned them or have they phone the administration? 683 00:35:57,080 --> 00:35:59,960 Speaker 6: That would be a big piece of news. 684 00:36:00,000 --> 00:36:05,360 Speaker 2: Absolutely fascinating. And more broadly, when you consider the semiconductor space, ed, 685 00:36:05,360 --> 00:36:08,839 Speaker 2: how would you describe this industry right now? Obviously we're 686 00:36:08,920 --> 00:36:11,759 Speaker 2: in flux. We're dealing with export controls that we've seen 687 00:36:11,880 --> 00:36:16,720 Speaker 2: an enormous amount of damage here to in Vidia shares, 688 00:36:16,760 --> 00:36:19,400 Speaker 2: for instance, over the past couple of weeks, despite a 689 00:36:19,440 --> 00:36:23,239 Speaker 2: great meeting between Jensen Wong and Donald Trump. But we're 690 00:36:23,320 --> 00:36:25,439 Speaker 2: drawing a line around Taiwan here and trying to figure 691 00:36:25,440 --> 00:36:27,000 Speaker 2: out how quickly they can pull this off. 692 00:36:27,719 --> 00:36:29,839 Speaker 16: It's the one hundred billion dollar question, and we don't 693 00:36:29,840 --> 00:36:31,560 Speaker 16: have enough time for me to answer it in full. 694 00:36:31,840 --> 00:36:35,400 Speaker 16: But basically, there are American chip companies that all design 695 00:36:35,520 --> 00:36:38,760 Speaker 16: chips that are right now in vogue. We are talking 696 00:36:38,760 --> 00:36:41,880 Speaker 16: about GPUs or accelerators that go into data centers to 697 00:36:41,920 --> 00:36:45,080 Speaker 16: train AI models. Intel's fallen behind in that space. In 698 00:36:45,200 --> 00:36:48,400 Speaker 16: video largely has a monopoly. The key point about a 699 00:36:48,400 --> 00:36:50,680 Speaker 16: company like in Video is it's what's called a fabulous 700 00:36:50,920 --> 00:36:54,120 Speaker 16: chip company. It designs the chips, someone else makes them. 701 00:36:54,200 --> 00:36:57,759 Speaker 16: As you just said, TSMC. The supply chain therefore has 702 00:36:57,800 --> 00:37:00,880 Speaker 16: the critical part the manufacturing of the chip in Taiwan 703 00:37:01,320 --> 00:37:03,920 Speaker 16: that is not China, but of course, in the context 704 00:37:03,960 --> 00:37:07,920 Speaker 16: of renegotiating the world order for trade, it's an important factor. 705 00:37:08,680 --> 00:37:11,359 Speaker 16: China is also a critically important end market for all 706 00:37:11,440 --> 00:37:14,719 Speaker 16: of these names, be they smartphone chip makers, be they 707 00:37:14,760 --> 00:37:17,319 Speaker 16: in the data center business. And what they want to 708 00:37:17,360 --> 00:37:20,560 Speaker 16: find out is, if I make a chip somewhere in 709 00:37:20,600 --> 00:37:22,960 Speaker 16: the world outside of the United States, is there a 710 00:37:23,000 --> 00:37:26,000 Speaker 16: business for me in China? And we don't have an 711 00:37:26,040 --> 00:37:28,400 Speaker 16: answer to that yet. I saw the headlines from Vestent today. 712 00:37:28,640 --> 00:37:30,880 Speaker 16: It doesn't answer the question of what happens next in 713 00:37:30,880 --> 00:37:33,160 Speaker 16: that sector specifically, It. 714 00:37:33,280 --> 00:37:35,440 Speaker 2: Sure doesn't, So we got to keep talking about it. 715 00:37:35,560 --> 00:37:39,319 Speaker 2: Ed Ludlow a journalist and a broadcaster peaking right now. 716 00:37:39,480 --> 00:37:41,279 Speaker 2: Ed come on more often and talk to us. He 717 00:37:41,320 --> 00:37:44,799 Speaker 2: co host Bloomberg Technology. He does have a full time job, 718 00:37:44,840 --> 00:37:46,759 Speaker 2: but we'll try to pull him into this conversation as 719 00:37:46,800 --> 00:37:50,160 Speaker 2: often as we can. Really interesting stuff. This is again 720 00:37:50,239 --> 00:37:54,600 Speaker 2: the intersection once again of Wall Street, Washington, and in 721 00:37:54,640 --> 00:37:57,280 Speaker 2: the case of Ed Ludlow, San Francisco, the technology sector. 722 00:37:57,320 --> 00:38:01,080 Speaker 2: You can't pull one leg out of the stool Ed. 723 00:38:01,160 --> 00:38:08,440 Speaker 2: Thank you, thanks for listening to the Balance of Power podcast. 724 00:38:09,040 --> 00:38:12,200 Speaker 2: Make sure to subscribe if you haven't already, at Apple, Spotify, 725 00:38:12,280 --> 00:38:14,839 Speaker 2: or wherever you get your podcasts, and you can find 726 00:38:14,920 --> 00:38:18,160 Speaker 2: us live every weekday from Washington, DC at noontime Eastern 727 00:38:18,480 --> 00:38:19,880 Speaker 2: at Bloomberg dot com.