1 00:00:02,680 --> 00:00:05,800 Speaker 1: This is Bloomberg Daybreak Weekend, our global look at the 2 00:00:05,840 --> 00:00:08,560 Speaker 1: top stories in the coming week from our Daybreak anchors 3 00:00:08,680 --> 00:00:11,440 Speaker 1: all around the world. Straight ahead on the program, is 4 00:00:11,480 --> 00:00:15,120 Speaker 1: inflation getting worse or slowing down? Time to place your beds. 5 00:00:15,360 --> 00:00:18,239 Speaker 1: I'm Nathan Hagar. I'm Caroline he in London, where we're 6 00:00:18,239 --> 00:00:21,560 Speaker 1: looking at plans for the Queen's state funeral. Brian Curtis 7 00:00:21,680 --> 00:00:24,480 Speaker 1: in Hong Kong. What are the chances the upcoming data 8 00:00:24,680 --> 00:00:28,440 Speaker 1: in China change the picture for markets? I'm Amy Morris 9 00:00:28,440 --> 00:00:31,280 Speaker 1: in Washington, will look into the changing fortunes of the 10 00:00:31,320 --> 00:00:37,280 Speaker 1: Republican Party as the midterm campaigns heat up. That's all 11 00:00:37,320 --> 00:00:41,400 Speaker 1: straight ahead on Bloomberg Daybreak Weekend on Bloomberg Eliven Free 12 00:00:41,479 --> 00:00:45,760 Speaker 1: on New York, Bloomberg one, Washington d C, Bloomberg one 13 00:00:45,800 --> 00:00:49,519 Speaker 1: oh six one, Boston, Bloomberg nine sixties, San Francisco, d 14 00:00:49,680 --> 00:00:53,840 Speaker 1: A B Digital Radio London, Sirius XM one and around 15 00:00:53,840 --> 00:00:56,440 Speaker 1: the world on Bloomberg Radio dot Com and via the 16 00:00:56,560 --> 00:01:01,800 Speaker 1: Bloomberg Business App. Good day to you. I'm Nathan Hagar. 17 00:01:01,920 --> 00:01:04,720 Speaker 1: We begin today's program with a look at inflation and 18 00:01:04,720 --> 00:01:07,679 Speaker 1: whether we could be in line for some relief for 19 00:01:07,760 --> 00:01:11,160 Speaker 1: that I'm joined by Bloomberg's Global Economics and Policy correspondent 20 00:01:11,520 --> 00:01:14,720 Speaker 1: Michael McKee. So, Mike, we're all waiting for the release 21 00:01:14,760 --> 00:01:19,000 Speaker 1: of the August Consumer Price Index on Tuesday. What are 22 00:01:19,040 --> 00:01:22,480 Speaker 1: you expecting. Well, there's a good possibility we could see 23 00:01:22,560 --> 00:01:25,800 Speaker 1: on a month over month basis a slight decline in 24 00:01:25,959 --> 00:01:29,440 Speaker 1: a CPI because energy prices continued to fall during the 25 00:01:29,480 --> 00:01:32,959 Speaker 1: month of August. That made a big difference in July 26 00:01:33,240 --> 00:01:37,880 Speaker 1: when month over month inflation came in basically flat. So 27 00:01:38,200 --> 00:01:41,200 Speaker 1: forecast a consensus forecast at this point for about a 28 00:01:41,200 --> 00:01:43,440 Speaker 1: tenth of a percentage point decline. Now that would only 29 00:01:43,480 --> 00:01:46,399 Speaker 1: push year over year inflation down to about eight point 30 00:01:46,480 --> 00:01:50,160 Speaker 1: one percent, So still very high and something that will 31 00:01:50,200 --> 00:01:55,120 Speaker 1: be concerning Americans. But progress. Yeah, progress, And I guess 32 00:01:55,160 --> 00:01:57,960 Speaker 1: the question is, as it has been for some time, 33 00:01:58,160 --> 00:02:01,880 Speaker 1: whether we've hit the peak of inflation. Can we say that, 34 00:02:02,200 --> 00:02:04,600 Speaker 1: given that so much of it is driven, as you 35 00:02:04,720 --> 00:02:08,720 Speaker 1: rightly point out, by energy and food prices. Yeah, that's 36 00:02:08,760 --> 00:02:12,160 Speaker 1: the problem. Um, in an ordinary world you'd say we'd 37 00:02:12,200 --> 00:02:15,200 Speaker 1: hit the peak. A number of categories are probably going 38 00:02:15,240 --> 00:02:19,560 Speaker 1: to start going down. Now we've seen, UH, car assemblies 39 00:02:19,639 --> 00:02:22,520 Speaker 1: start to pick up, so h new car prices should 40 00:02:22,560 --> 00:02:26,119 Speaker 1: start to fall. Use car prices are already falling, and 41 00:02:26,200 --> 00:02:30,600 Speaker 1: with the decline in how home sales market, we're seeing 42 00:02:30,720 --> 00:02:35,320 Speaker 1: appliances start to uh, you know, stop their increases at 43 00:02:35,360 --> 00:02:37,520 Speaker 1: least put it that way in in some cases fall. 44 00:02:37,960 --> 00:02:41,440 Speaker 1: Even though housing will still contribute to inflation, the things 45 00:02:41,520 --> 00:02:43,840 Speaker 1: we buy two put in our homes may not, so 46 00:02:43,880 --> 00:02:46,400 Speaker 1: that could have a big impact, particularly on core inflation. 47 00:02:46,680 --> 00:02:50,720 Speaker 1: The problem is you have something like Vladimir Putin's addressed 48 00:02:50,840 --> 00:02:56,040 Speaker 1: last week in which he said that the gas is 49 00:02:56,080 --> 00:02:58,960 Speaker 1: going to stay off for a while and Europe's gonna 50 00:02:59,000 --> 00:03:02,560 Speaker 1: have a cold winder oil being fungible around the world, 51 00:03:02,800 --> 00:03:06,400 Speaker 1: a global price. We could easily see headline inflation go 52 00:03:06,480 --> 00:03:09,280 Speaker 1: back up if an energy prices go back up, And 53 00:03:09,320 --> 00:03:12,080 Speaker 1: of course that's something that the Federal Reserve doesn't have 54 00:03:12,160 --> 00:03:15,560 Speaker 1: much control over with the tools it has, and it's 55 00:03:15,560 --> 00:03:19,400 Speaker 1: gonna stay focused on, as you mentioned earlier, the core. 56 00:03:19,960 --> 00:03:22,640 Speaker 1: What are we looking at from the core? Well, we 57 00:03:22,720 --> 00:03:26,320 Speaker 1: are looking at this point, uh for a three ten 58 00:03:26,639 --> 00:03:30,800 Speaker 1: percent gain, that's the consensus so far, and that would 59 00:03:31,120 --> 00:03:34,280 Speaker 1: bring the core rate on a year over your basis 60 00:03:34,320 --> 00:03:37,280 Speaker 1: because of base effects up from where it was was 61 00:03:37,360 --> 00:03:39,320 Speaker 1: five point nine percent of July would go up to 62 00:03:39,840 --> 00:03:44,600 Speaker 1: six in this case, Given where we are with inflation 63 00:03:44,920 --> 00:03:52,200 Speaker 1: and the unique nature of pandemic induced inflationary episode, I 64 00:03:52,240 --> 00:03:54,240 Speaker 1: think the FED would be satisfied to see some of 65 00:03:54,240 --> 00:03:58,320 Speaker 1: the major categories going down even if the overall headline 66 00:03:58,360 --> 00:04:03,400 Speaker 1: inflation doesn't go down. If we get a real surprise 67 00:04:04,480 --> 00:04:09,280 Speaker 1: rise in core inflation, that would certainly seal seventy bases 68 00:04:09,320 --> 00:04:12,080 Speaker 1: point increase at the FED meeting on the twenty one, 69 00:04:12,320 --> 00:04:14,880 Speaker 1: But that's probably baked in anyway. It would take quite 70 00:04:14,880 --> 00:04:18,560 Speaker 1: a fall for the FED to change their minds about that. Now. Yeah, 71 00:04:18,600 --> 00:04:22,200 Speaker 1: it sounds like the Fed itself is almost baked that in, 72 00:04:22,360 --> 00:04:25,040 Speaker 1: given some of the hawkish commentary we've heard in the 73 00:04:25,160 --> 00:04:28,120 Speaker 1: run up, not just to this inflation print, but to 74 00:04:28,200 --> 00:04:32,200 Speaker 1: the decision coming up later this month. Yeah, the Feds 75 00:04:32,200 --> 00:04:35,000 Speaker 1: seems to have gotten more hawkish as time went by, 76 00:04:35,080 --> 00:04:37,520 Speaker 1: and that maybe in part of by product of that 77 00:04:37,600 --> 00:04:40,320 Speaker 1: strong jobs report we got for the month of August. 78 00:04:40,640 --> 00:04:42,840 Speaker 1: And if inflation doesn't fall a lot, then it just 79 00:04:42,920 --> 00:04:46,159 Speaker 1: it makes their decision a whole lot easier. Uh. I 80 00:04:46,200 --> 00:04:50,359 Speaker 1: think Jim Bullard put it best. Uh, He's been a 81 00:04:50,520 --> 00:04:53,440 Speaker 1: hawk all along of pushing for seventy five basis points, 82 00:04:53,720 --> 00:04:55,760 Speaker 1: and he said, if you're going to get to a 83 00:04:55,800 --> 00:04:58,200 Speaker 1: certain level, which they all agree they need to do 84 00:04:58,320 --> 00:05:02,640 Speaker 1: slightly restrictive, why wait, do it now, and then if 85 00:05:02,680 --> 00:05:05,320 Speaker 1: you need to you can reverse it. But by dragging 86 00:05:05,360 --> 00:05:08,720 Speaker 1: it out, you only let inflation get more firmly entrenched. 87 00:05:08,760 --> 00:05:11,680 Speaker 1: And so I think that's kind of what they've all embraced. 88 00:05:11,960 --> 00:05:16,279 Speaker 1: There's a tactical, uh question about how high you need 89 00:05:16,320 --> 00:05:19,839 Speaker 1: to go, whether they need to go over four percent 90 00:05:19,960 --> 00:05:24,040 Speaker 1: or not, what is restrictive, but the strategy is all 91 00:05:24,120 --> 00:05:26,080 Speaker 1: kind of the same. We get up to that restrictive 92 00:05:26,160 --> 00:05:28,480 Speaker 1: level and leave it there for a while. Yeah, I 93 00:05:28,520 --> 00:05:31,360 Speaker 1: was gonna say, I'm sure there's a lot of discussion, 94 00:05:31,480 --> 00:05:35,479 Speaker 1: a lot of debate about whether we're already in restrictive territory, 95 00:05:35,600 --> 00:05:39,120 Speaker 1: even though, as you say, the markets are expecting that 96 00:05:39,400 --> 00:05:42,960 Speaker 1: rates are going to continue going higher, and even if 97 00:05:43,000 --> 00:05:45,719 Speaker 1: it starts too slow, we are going to see further 98 00:05:45,839 --> 00:05:48,599 Speaker 1: increases for the rest of this year. Yeah, this is 99 00:05:48,640 --> 00:05:50,520 Speaker 1: where we get a little nerdy and point out that 100 00:05:50,560 --> 00:05:54,440 Speaker 1: the FED looks at the long term neutral rate as 101 00:05:54,600 --> 00:05:56,760 Speaker 1: about two and a half percent. That would be with 102 00:05:56,880 --> 00:06:01,320 Speaker 1: unemployment somewhere in the low four percent rate and inflation 103 00:06:01,880 --> 00:06:05,880 Speaker 1: somewhere around two percent. But since inflation is elevated and 104 00:06:06,120 --> 00:06:09,479 Speaker 1: unemployment is lower than what the Fed thinks is a 105 00:06:09,560 --> 00:06:14,039 Speaker 1: neutral level, it is likely that the Fed thinks the 106 00:06:14,080 --> 00:06:16,839 Speaker 1: neutral rate is temporarily much higher. In other words, it'll 107 00:06:16,880 --> 00:06:20,919 Speaker 1: it'll take more of rate increase to bring down the 108 00:06:21,000 --> 00:06:23,960 Speaker 1: inflation rate to what it thinks is neutral, and then 109 00:06:24,000 --> 00:06:27,080 Speaker 1: they could bring down UH interest rates. So you could 110 00:06:27,080 --> 00:06:30,680 Speaker 1: expect that the Fed is going to get to somewhere 111 00:06:30,680 --> 00:06:33,359 Speaker 1: in the vicinity of foreign if we have a surprise, 112 00:06:33,400 --> 00:06:36,480 Speaker 1: go over it UH and hold it there for quite 113 00:06:36,520 --> 00:06:40,800 Speaker 1: some time. Unless we get signs of recession. It is 114 00:06:40,880 --> 00:06:44,040 Speaker 1: likely that we're going to leave interest rates in this 115 00:06:44,080 --> 00:06:47,760 Speaker 1: neighborhood or above for at least a year. All right, Mike, 116 00:06:47,800 --> 00:06:50,440 Speaker 1: thanks for being with us. That's Bloomberg Global Economics and 117 00:06:50,520 --> 00:06:55,000 Speaker 1: Policy correspondent Michael McKean, and coming up on Bloomberg Daybreak weekend, 118 00:06:55,080 --> 00:06:57,880 Speaker 1: we turned to the UK with Britain in ten days 119 00:06:57,920 --> 00:07:00,960 Speaker 1: of mourning following the death of the Queen. I'm Nathan 120 00:07:01,000 --> 00:07:08,599 Speaker 1: Hagar and this is Bloomberger. This is Bloomberg Daybreak weekend. 121 00:07:08,640 --> 00:07:11,360 Speaker 1: Our global look ahead at the top stories for investors 122 00:07:11,360 --> 00:07:13,920 Speaker 1: in the coming week. I'm Nathan Hagar. Up. Later in 123 00:07:13,960 --> 00:07:16,920 Speaker 1: our program we'll look at the Chinese economy, but first 124 00:07:17,040 --> 00:07:19,520 Speaker 1: we head across the pond to the UK, where the 125 00:07:19,560 --> 00:07:23,120 Speaker 1: British people lost their queen this week. Now the country 126 00:07:23,200 --> 00:07:25,680 Speaker 1: enters a period of mourning. For more on the details 127 00:07:25,680 --> 00:07:28,560 Speaker 1: and the path ahead, we turned to BLUEMBERG Daybreak Europe 128 00:07:28,520 --> 00:07:32,400 Speaker 1: anchors Caroline Hepger and Stephen Caroll. Nathan. The Queen died 129 00:07:32,480 --> 00:07:35,800 Speaker 1: peacefully at balm Mole on Thursday, the eighth of September, 130 00:07:35,920 --> 00:07:38,800 Speaker 1: and on Friday the nation went into a period of 131 00:07:38,840 --> 00:07:42,400 Speaker 1: ten days of morning. What are we expecting over these 132 00:07:42,480 --> 00:07:45,520 Speaker 1: coming days, Well, the lying in state of the Queen, 133 00:07:45,680 --> 00:07:49,040 Speaker 1: King Charles the Third's first speech to the nation as King, 134 00:07:49,480 --> 00:07:52,960 Speaker 1: and of course then the state funeral of Queen Elizabeth. 135 00:07:53,400 --> 00:07:55,960 Speaker 1: Now I expect the mood in London will no doubt 136 00:07:56,000 --> 00:07:59,440 Speaker 1: be extremely somber in the coming days. Stephen, Yes, already 137 00:07:59,440 --> 00:08:02,360 Speaker 1: we could see in the mere moments after the news 138 00:08:02,400 --> 00:08:05,560 Speaker 1: was announced, already the formal process was in place. The 139 00:08:05,600 --> 00:08:08,920 Speaker 1: new Prime Minister, Liz Trust said that Queen Elizabeth the 140 00:08:08,920 --> 00:08:12,480 Speaker 1: Second was the rock on which modern Britain was built 141 00:08:12,480 --> 00:08:15,640 Speaker 1: her predecessor. Boris Johnson also commenting saying that in the 142 00:08:15,680 --> 00:08:17,640 Speaker 1: hearts of every one of us there was there is 143 00:08:17,680 --> 00:08:19,760 Speaker 1: an ache at the passing of our queen, a deep 144 00:08:19,800 --> 00:08:23,280 Speaker 1: and personal sense of loss, far more intense perhaps than 145 00:08:23,320 --> 00:08:26,240 Speaker 1: we expected. Interesting that he reflects on that point of 146 00:08:26,560 --> 00:08:31,720 Speaker 1: her being such a constant in people's lives in this country, 147 00:08:31,920 --> 00:08:35,120 Speaker 1: and how even though she was ninety six years old, 148 00:08:35,360 --> 00:08:37,960 Speaker 1: it still has come as a shock and and deeply 149 00:08:37,960 --> 00:08:40,920 Speaker 1: affected so many people here. Yeah. Absolutely, I think the 150 00:08:41,040 --> 00:08:46,080 Speaker 1: nation was already on alert on Thursday when on Bloomberg 151 00:08:46,160 --> 00:08:49,480 Speaker 1: Radio we were focused, of course on the economics and politics. 152 00:08:49,520 --> 00:08:53,040 Speaker 1: We were watching the brand new Prime Minister delivering a 153 00:08:53,160 --> 00:08:57,560 Speaker 1: significant speech on energy bills, and in Parliament at some 154 00:08:57,640 --> 00:09:00,640 Speaker 1: point after that speech, key politicians were added a slip 155 00:09:00,640 --> 00:09:04,400 Speaker 1: of paper. Then we got the Bucking and Palace release 156 00:09:04,440 --> 00:09:07,520 Speaker 1: of a statement about the Queen's health. That really did 157 00:09:07,960 --> 00:09:11,880 Speaker 1: put the country on notice about the gravity of the situation. 158 00:09:12,480 --> 00:09:16,600 Speaker 1: It wasn't though, until six thirty or around that point 159 00:09:16,679 --> 00:09:19,680 Speaker 1: on Thursday evening, that we learned of the death of 160 00:09:19,720 --> 00:09:22,360 Speaker 1: the Queen. As that news has been thinking in here, 161 00:09:22,360 --> 00:09:25,880 Speaker 1: we've been speaking to Charles Anson, whose communications consultant and 162 00:09:25,920 --> 00:09:28,920 Speaker 1: a former press secretary to the Queen. He was speaking 163 00:09:28,920 --> 00:09:31,160 Speaker 1: to us on Bloomberg Radio and here some of his 164 00:09:31,200 --> 00:09:34,200 Speaker 1: reflections on the Queen's legacy and what might be to 165 00:09:34,280 --> 00:09:37,280 Speaker 1: come under King Charles the Third. The reason that the 166 00:09:37,320 --> 00:09:42,080 Speaker 1: British monarchy has survived and prospered over a thousand years, 167 00:09:42,080 --> 00:09:45,720 Speaker 1: with difficult times and good times as well. The reason 168 00:09:45,760 --> 00:09:49,240 Speaker 1: it has survived it has been able to adapt, and 169 00:09:50,000 --> 00:09:53,439 Speaker 1: none more so than in these last seventy years have 170 00:09:53,640 --> 00:09:56,640 Speaker 1: changed since the Second World War. And what the Queen 171 00:09:56,679 --> 00:10:00,080 Speaker 1: has brought is a sort of steady modernizing approach of 172 00:10:00,080 --> 00:10:04,480 Speaker 1: the monarchy, whilst remaining herself the same character she was 173 00:10:04,640 --> 00:10:10,839 Speaker 1: when she stood and knelt in Westminster Abbey her coronation. 174 00:10:11,480 --> 00:10:14,720 Speaker 1: And I think that combination of appearing to be the 175 00:10:14,800 --> 00:10:17,920 Speaker 1: same whilst being open to new ideas and new ways 176 00:10:17,920 --> 00:10:22,480 Speaker 1: of doing things has served the monarchy very well and 177 00:10:23,080 --> 00:10:26,719 Speaker 1: reflects that there's society in the country that we now 178 00:10:26,800 --> 00:10:30,680 Speaker 1: live in. And I think the process and embracing change 179 00:10:30,720 --> 00:10:34,040 Speaker 1: in a very quiet sort of way has been very effective. 180 00:10:34,160 --> 00:10:37,720 Speaker 1: And of course this has been admired by other great 181 00:10:38,160 --> 00:10:43,319 Speaker 1: political figures around the world. News Mandela Barack Obama virtually 182 00:10:43,400 --> 00:10:47,480 Speaker 1: every American president has valued the Queen's and take on things. 183 00:10:47,480 --> 00:10:53,199 Speaker 1: Her experience is enormous, and she's used it and projected 184 00:10:53,240 --> 00:10:58,520 Speaker 1: Britain in a way that has been a touching to 185 00:10:58,640 --> 00:11:02,600 Speaker 1: many people. Given that legacy and influence of the Queen, 186 00:11:02,960 --> 00:11:07,000 Speaker 1: what sort of king do you think that Charles will be? Well? 187 00:11:07,040 --> 00:11:11,080 Speaker 1: I think each monarch brings his own his or her 188 00:11:11,120 --> 00:11:16,160 Speaker 1: own style and some beliefs to the role, But essentially 189 00:11:16,600 --> 00:11:24,520 Speaker 1: the core value of the monarchy is to remain politically 190 00:11:24,559 --> 00:11:29,360 Speaker 1: neutral above the political fray, and to work for society 191 00:11:30,080 --> 00:11:32,959 Speaker 1: and the nation as a whole. And I think the 192 00:11:33,120 --> 00:11:36,280 Speaker 1: aim very much of the Prince of Wales now King 193 00:11:36,360 --> 00:11:40,880 Speaker 1: Charles the Third, and of his mother, Queen Elizabeth, was 194 00:11:40,960 --> 00:11:44,480 Speaker 1: to try to make a better world, one that was 195 00:11:44,520 --> 00:11:48,040 Speaker 1: more tolerant, one that was more stable and steady, and 196 00:11:48,160 --> 00:11:50,760 Speaker 1: one that was able to deal with adversity as well 197 00:11:50,760 --> 00:11:54,680 Speaker 1: as with triumph. And I think that combination of quiet 198 00:11:54,760 --> 00:11:59,400 Speaker 1: steadiness making the world a certainly better place is a 199 00:11:59,440 --> 00:12:04,280 Speaker 1: tremendous ingredient in the world where politics is often a 200 00:12:04,480 --> 00:12:09,120 Speaker 1: very rough business, and the constitutional monarchy there's an overlay 201 00:12:09,280 --> 00:12:13,559 Speaker 1: to the political and economics society and God embodies a 202 00:12:13,640 --> 00:12:19,000 Speaker 1: set of values about decency, about tolerance, about fairness, about inclusion, 203 00:12:19,640 --> 00:12:22,560 Speaker 1: about good relations with people in the matter what their 204 00:12:22,559 --> 00:12:25,400 Speaker 1: religion are, what their color are, so and so forth. 205 00:12:25,960 --> 00:12:30,480 Speaker 1: And I think you know, under in reign of the 206 00:12:30,600 --> 00:12:34,920 Speaker 1: new King, it will be interesting to see how King 207 00:12:35,040 --> 00:12:39,240 Speaker 1: Charles the Third takes forward and this sense of inclusion 208 00:12:39,320 --> 00:12:42,920 Speaker 1: in society which he has spent over the fifty years 209 00:12:43,120 --> 00:12:48,319 Speaker 1: and promoting and encouraging amongst young people of different colors 210 00:12:48,360 --> 00:12:51,560 Speaker 1: and religions in the sort of modern society that we 211 00:12:51,640 --> 00:12:54,400 Speaker 1: have now. And I think that's a forceful influence. It's 212 00:12:54,440 --> 00:12:58,920 Speaker 1: not a party political influence, but for the body politics 213 00:12:58,960 --> 00:13:03,280 Speaker 1: ahult to have a constitutional monarchy doesn't interfere with the 214 00:13:03,480 --> 00:13:07,400 Speaker 1: day to day political process, but there's art and minds 215 00:13:08,559 --> 00:13:13,599 Speaker 1: of that monarchy are for the changes needed in the 216 00:13:13,720 --> 00:13:16,360 Speaker 1: mode societies and make it work well and to make 217 00:13:16,400 --> 00:13:19,400 Speaker 1: it work more fairly. I think there are a great 218 00:13:19,440 --> 00:13:21,720 Speaker 1: force for good in that respect. And I think whether 219 00:13:21,760 --> 00:13:25,360 Speaker 1: you're a monarchist or not, our constitutional monarchy is a 220 00:13:25,480 --> 00:13:33,320 Speaker 1: mechanism that offers a bit more stability and prospect for 221 00:13:33,480 --> 00:13:38,080 Speaker 1: sensible change, for good manners and for high standards in 222 00:13:38,360 --> 00:13:42,959 Speaker 1: society and particularly in political and public life. And they 223 00:13:43,040 --> 00:13:46,760 Speaker 1: said that example in the Queen is a superb an 224 00:13:46,760 --> 00:13:51,080 Speaker 1: exemplar of that. That's trans Anson, former Press Ecretary to 225 00:13:51,120 --> 00:13:54,440 Speaker 1: the Queen. How fascinating to hear those insights from someone 226 00:13:54,480 --> 00:13:57,800 Speaker 1: who knows the royal family so well about the challenges 227 00:13:58,080 --> 00:14:02,600 Speaker 1: not insignificant face King Charles the Third, he is seventy 228 00:14:02,640 --> 00:14:05,000 Speaker 1: three years old and we know him well. Of course, 229 00:14:05,000 --> 00:14:07,880 Speaker 1: he is the oldest person to accede to the throne 230 00:14:07,880 --> 00:14:12,360 Speaker 1: in British history. We know and understand how much rests 231 00:14:12,400 --> 00:14:16,920 Speaker 1: now upon his shoulders. But I think Stephen, over these 232 00:14:16,960 --> 00:14:20,600 Speaker 1: coming days, I and many Britain's will be grieving, no doubt, 233 00:14:20,720 --> 00:14:24,640 Speaker 1: quite personally for the loss of the longest reigning monarch 234 00:14:24,680 --> 00:14:27,840 Speaker 1: in British history. We're going to be continuing our reporting 235 00:14:27,880 --> 00:14:30,800 Speaker 1: here on Bloomberg Radio as we look to the state 236 00:14:30,840 --> 00:14:35,000 Speaker 1: funeral of Queen Elizabeth the Second and we commemorate her 237 00:14:35,040 --> 00:14:38,120 Speaker 1: life and times. I'm Stephen Carroll in London. You can 238 00:14:38,160 --> 00:14:41,080 Speaker 1: catch us every weekday morning here for Bloomberg Daybreak Europe, 239 00:14:41,120 --> 00:14:43,720 Speaker 1: starting at six am in London and one am on 240 00:14:43,800 --> 00:14:47,200 Speaker 1: Wall Street. Nathan, thank you, Caroline and Stephen, and coming 241 00:14:47,240 --> 00:14:50,760 Speaker 1: up I'm Bloomberg Daybreak Weekend. How much is China's economy 242 00:14:50,880 --> 00:15:07,600 Speaker 1: really slowing? I'm Nathan Hager, and this is Bloomberg broadcasting 243 00:15:07,680 --> 00:15:11,400 Speaker 1: live from the Bloomberg Interactive Broker Studio in New York. 244 00:15:11,480 --> 00:15:16,160 Speaker 1: Bloomberg eleven three oh to Washington, d C, Bloomberg to Boston, 245 00:15:16,240 --> 00:15:19,640 Speaker 1: Bloomberg one O six one to San Francisco, Bloomberg nine 246 00:15:19,760 --> 00:15:23,040 Speaker 1: six to the country Sirius XM Channel one nineteen to 247 00:15:23,200 --> 00:15:26,320 Speaker 1: London d A B Digital Radio, and around the globe 248 00:15:26,400 --> 00:15:30,000 Speaker 1: the Bloomberg Business Act and Bloomberg Radio dot Com. This 249 00:15:30,320 --> 00:15:39,600 Speaker 1: is Bloomberg day Break Weekend. I'm Nathan Hager with your 250 00:15:39,640 --> 00:15:42,240 Speaker 1: global look ahead at the top stories for investors in 251 00:15:42,280 --> 00:15:46,160 Speaker 1: the coming week. China's economy has been experiencing some pacups, 252 00:15:46,200 --> 00:15:48,200 Speaker 1: we'll call them, and we may learn more in the 253 00:15:48,240 --> 00:15:51,400 Speaker 1: comic week about just how big the challenges or problems 254 00:15:51,520 --> 00:15:54,080 Speaker 1: really are in Beijing for more. Let's head to Hong 255 00:15:54,160 --> 00:15:57,960 Speaker 1: Kong and Bloomberg Daybreak Asia host Brian Curtis. Nathan will 256 00:15:58,000 --> 00:16:00,280 Speaker 1: get a slew of Chinese data in the coming week 257 00:16:00,360 --> 00:16:03,560 Speaker 1: that will shed further light on the health of the economy. 258 00:16:03,800 --> 00:16:07,080 Speaker 1: Markets in China have been choppy for months now in 259 00:16:07,200 --> 00:16:11,120 Speaker 1: light of further COVID lockdowns, the property crisis, a tough 260 00:16:11,200 --> 00:16:16,520 Speaker 1: regulatory overhanging, and rising geopolitical tensions. Joining us to see 261 00:16:16,560 --> 00:16:19,280 Speaker 1: what it all means here for markets going forward in 262 00:16:19,440 --> 00:16:24,720 Speaker 1: China is Sophia Orte Costa, Bloomberg's chief China market correspondent. Sophia, 263 00:16:24,760 --> 00:16:27,400 Speaker 1: thanks very much for taking some time with this. So 264 00:16:27,440 --> 00:16:30,600 Speaker 1: the c s I three, it's interesting it had strong 265 00:16:30,800 --> 00:16:35,600 Speaker 1: outperformance against global peers from the period of April until 266 00:16:36,040 --> 00:16:38,680 Speaker 1: about the end of June, and then all of a sudden, 267 00:16:38,680 --> 00:16:42,240 Speaker 1: the door was slammed and we've been grinding lower from 268 00:16:42,280 --> 00:16:44,760 Speaker 1: that time. What happened, Yeah, there was a sense that 269 00:16:44,800 --> 00:16:48,400 Speaker 1: the worst was kind of over around April in terms 270 00:16:48,400 --> 00:16:52,400 Speaker 1: of lockdowns, COVID zero and also the property market. That's 271 00:16:52,480 --> 00:16:56,160 Speaker 1: kind of when officials and authorities in a Chinese hits 272 00:16:56,160 --> 00:16:59,680 Speaker 1: he started rolling back some of the strictest measures around 273 00:16:59,680 --> 00:17:03,240 Speaker 1: prop to around housing. That's also when we saw the 274 00:17:03,280 --> 00:17:06,240 Speaker 1: officials really react quite strongly to the risk of the 275 00:17:06,280 --> 00:17:09,440 Speaker 1: mortgage boycott's kind of going out of control. So there 276 00:17:09,480 --> 00:17:12,320 Speaker 1: was a little bit of faith in financial markets that 277 00:17:12,680 --> 00:17:16,359 Speaker 1: um that things would get better. The problem is these 278 00:17:16,400 --> 00:17:19,960 Speaker 1: rebounds really don't last inflows don't stick, and nothing really 279 00:17:20,040 --> 00:17:25,000 Speaker 1: changes despite vows of more action from Beijing. The problem 280 00:17:25,080 --> 00:17:29,280 Speaker 1: really is when we saw that economic data actually turn 281 00:17:29,400 --> 00:17:33,120 Speaker 1: worse after the summer, people really started thinking that actually, 282 00:17:33,119 --> 00:17:35,159 Speaker 1: you know, now is not the right time to buy, 283 00:17:35,200 --> 00:17:39,040 Speaker 1: and confidence really really really declined from there. And it's 284 00:17:39,040 --> 00:17:45,280 Speaker 1: both internal and external demand that is lagging, yes, exactly, 285 00:17:45,320 --> 00:17:49,800 Speaker 1: I mean within China domestically. The problem is the fiscal 286 00:17:49,840 --> 00:17:54,560 Speaker 1: stimulus plans and the the surprise interest rate cuts. Um, 287 00:17:54,600 --> 00:17:58,720 Speaker 1: they're really not that's all on the demand side of things, um. Sorry, 288 00:17:58,720 --> 00:18:01,360 Speaker 1: on the supply side of things, it's not doing anything 289 00:18:01,400 --> 00:18:04,879 Speaker 1: to stir up demand. UM. When you have retail sales 290 00:18:04,920 --> 00:18:07,560 Speaker 1: really low. I mean we're getting uh and the number 291 00:18:07,600 --> 00:18:11,800 Speaker 1: for August is expected to be around three point growth UM. 292 00:18:11,840 --> 00:18:14,520 Speaker 1: But that's not that's not great when you consider the 293 00:18:14,560 --> 00:18:19,560 Speaker 1: impact of COVID zero and the never ending extended lockdowns 294 00:18:19,600 --> 00:18:22,800 Speaker 1: in big cities like cheng Do. That is the key thing, 295 00:18:22,840 --> 00:18:25,440 Speaker 1: and that kind of stops everything else from being effective. 296 00:18:25,480 --> 00:18:28,439 Speaker 1: It doesn't matter what Bijing does, the more vows of 297 00:18:28,480 --> 00:18:32,000 Speaker 1: more action and actual action keep falling flat. In terms 298 00:18:32,160 --> 00:18:34,960 Speaker 1: of the stimulus, I mean, we can't say that policymakers 299 00:18:35,000 --> 00:18:38,879 Speaker 1: haven't acted. They have rolled out measures, but it's just 300 00:18:39,119 --> 00:18:42,800 Speaker 1: no shock and awe. It's been drip, drip drip. Now, 301 00:18:42,840 --> 00:18:47,040 Speaker 1: if we were to get a U shape recovery, plenty 302 00:18:47,080 --> 00:18:49,400 Speaker 1: of economists tell us on our show Bloomberg Dave brak 303 00:18:49,400 --> 00:18:52,480 Speaker 1: Asia that that's what we can expect, the U shaped recovery. 304 00:18:52,520 --> 00:18:54,919 Speaker 1: If we were to get that, what might the catalysts be? 305 00:18:55,840 --> 00:18:58,080 Speaker 1: I spoke to someone this this week. Actually, it will 306 00:18:58,119 --> 00:19:00,919 Speaker 1: be a long grind. There is expectation of a U 307 00:19:01,000 --> 00:19:04,960 Speaker 1: shaped recovery. We we do have the Key Party Congress 308 00:19:04,960 --> 00:19:08,280 Speaker 1: on October sixteenth, and my sense that there's so much 309 00:19:08,359 --> 00:19:12,919 Speaker 1: baked into, so much expectation of of some kind of 310 00:19:12,960 --> 00:19:16,000 Speaker 1: pivot after that. The question for me is what would 311 00:19:16,000 --> 00:19:18,280 Speaker 1: the pivot look like. It doesn't look like she jumping 312 00:19:18,880 --> 00:19:21,239 Speaker 1: is really easy off on the COVID zero Pulsey and 313 00:19:21,280 --> 00:19:24,840 Speaker 1: that is Brian, really the biggest overhang in markets. The 314 00:19:24,880 --> 00:19:28,680 Speaker 1: catalyst would be a suggestion that that will be pulled back. 315 00:19:28,760 --> 00:19:31,639 Speaker 1: We know that that will be gradual and we know 316 00:19:31,800 --> 00:19:34,359 Speaker 1: what it's like. I mean here in Hong Kong it's 317 00:19:34,359 --> 00:19:37,879 Speaker 1: been a very slow reopening, but any kind of sense 318 00:19:38,000 --> 00:19:40,720 Speaker 1: or sign that China is moving in the right direction 319 00:19:41,240 --> 00:19:43,800 Speaker 1: in terms of opening up the economy and opening up 320 00:19:43,800 --> 00:19:47,000 Speaker 1: its borders would be a significant catalyst for markets. We 321 00:19:47,040 --> 00:19:49,280 Speaker 1: had the regulatory overhang, which seems like it would never 322 00:19:49,320 --> 00:19:51,560 Speaker 1: go away, and I'm not sure that it has, but 323 00:19:52,000 --> 00:19:53,959 Speaker 1: it does seem like it doesn't really get as much 324 00:19:54,000 --> 00:19:56,159 Speaker 1: attention right now. It seems like they've backed off a 325 00:19:56,200 --> 00:20:00,000 Speaker 1: little bit on that side of things. Could that possible 326 00:20:00,160 --> 00:20:04,000 Speaker 1: happen with dynamic zero, Brian, It's all about watching the 327 00:20:04,040 --> 00:20:07,200 Speaker 1: signs and seeing where China is going. If we do get, 328 00:20:07,240 --> 00:20:12,560 Speaker 1: for example, m a relaxation of cross border testing, or 329 00:20:12,640 --> 00:20:14,920 Speaker 1: if we get any sense that there are more flights 330 00:20:15,119 --> 00:20:19,720 Speaker 1: from overseas into China, or if even within China there's 331 00:20:19,760 --> 00:20:23,359 Speaker 1: an easing of movement between provinces, that would be a 332 00:20:23,480 --> 00:20:26,760 Speaker 1: very good sign, at least from where we're standing, that 333 00:20:26,760 --> 00:20:29,280 Speaker 1: that China is moving forward with this. Thanks so much 334 00:20:29,320 --> 00:20:31,199 Speaker 1: for joining us to take a close look at this, 335 00:20:31,240 --> 00:20:35,520 Speaker 1: Sophia or Too Acosta, Bloomberg's chief China market correspondent. I'm 336 00:20:35,520 --> 00:20:38,200 Speaker 1: Brian Curtis, along with Doug Krisner. You can catch us 337 00:20:38,200 --> 00:20:41,720 Speaker 1: every weekday here for Bloomberg Daybreak. Asia, beginning at six 338 00:20:41,760 --> 00:20:45,719 Speaker 1: am in Hong Kong and six pm on Wall Street. Nathan, 339 00:20:46,080 --> 00:20:49,040 Speaker 1: Thank you, Brian. And coming up on Bloomberg Daybreak weekend, 340 00:20:49,080 --> 00:20:52,040 Speaker 1: the GOP gets ready to try to end internal bickering 341 00:20:52,400 --> 00:20:56,320 Speaker 1: with a new platform. I'm Nathan Hagar, and this is Bloomberg. 342 00:21:07,000 --> 00:21:10,159 Speaker 1: This is Bloomberg Daybreak Weekend, our global look ahead at 343 00:21:10,200 --> 00:21:12,840 Speaker 1: the top stories for investors in the coming week. I'm 344 00:21:12,920 --> 00:21:15,920 Speaker 1: Nathan Hagar. The Republican Party is getting ready to try 345 00:21:15,920 --> 00:21:19,399 Speaker 1: to end its internal bickering with a new GOP platform. 346 00:21:19,520 --> 00:21:21,480 Speaker 1: For more on exactly what they're doing ahead of the 347 00:21:21,520 --> 00:21:24,160 Speaker 1: mid terms, let's go to Amy Morris in the Bloomberg 348 00:21:24,960 --> 00:21:28,560 Speaker 1: newsroom in Washington. Amy, that's right, Nathan. Republican leaders are 349 00:21:28,600 --> 00:21:32,800 Speaker 1: aiming to unveil a unified party platform. House Minority Leader 350 00:21:32,880 --> 00:21:36,320 Speaker 1: Kevin McCarthy planning to do this in September on the nineteenth. 351 00:21:36,680 --> 00:21:39,840 Speaker 1: Joining me now to talk about this, Bloomberg political reporter 352 00:21:39,920 --> 00:21:43,239 Speaker 1: Gregory Cordy. Greg thanks so much for joining us. We 353 00:21:43,280 --> 00:21:46,760 Speaker 1: really appreciate taking the time. Sure, now, the Republicans really 354 00:21:46,800 --> 00:21:48,879 Speaker 1: trying to get off the back foot here, tell us 355 00:21:48,920 --> 00:21:52,840 Speaker 1: what their strategy is. Well, one of the things they're 356 00:21:52,840 --> 00:21:57,640 Speaker 1: trying to do is to uh present a campaign that's 357 00:21:57,680 --> 00:22:02,359 Speaker 1: more than just being against President Joe Biden and his agenda, 358 00:22:02,560 --> 00:22:05,439 Speaker 1: but trying to give voters something to vote for. And 359 00:22:05,520 --> 00:22:08,680 Speaker 1: so what they're gonna be doing UH in later this 360 00:22:08,720 --> 00:22:12,720 Speaker 1: month is going to the city outside of Pittsburgh, Pennsylvania, 361 00:22:13,040 --> 00:22:17,120 Speaker 1: which is significant in and of itself, to unveil this 362 00:22:17,560 --> 00:22:21,680 Speaker 1: commitment with America, which is a uh something that kind 363 00:22:21,680 --> 00:22:24,439 Speaker 1: of harkens back to New Gingrich's Contract with America back 364 00:22:25,480 --> 00:22:27,560 Speaker 1: when Republicans took the House for the first time in 365 00:22:27,640 --> 00:22:31,640 Speaker 1: decades and sort of layout what their agenda would be 366 00:22:31,760 --> 00:22:34,200 Speaker 1: if they took back the House. So it includes things 367 00:22:34,280 --> 00:22:41,080 Speaker 1: like of the economy, uh, emphasizing energy production, on safety, 368 00:22:41,160 --> 00:22:44,359 Speaker 1: talking about building that border wall that President Trump didn't 369 00:22:44,400 --> 00:22:49,440 Speaker 1: quite finish, also just holding the Biden administration to account 370 00:22:49,480 --> 00:22:53,119 Speaker 1: with more aggressive congressional oversight. Was back in June of 371 00:22:53,320 --> 00:22:56,240 Speaker 1: last year the Republicans first started working on this, and 372 00:22:56,280 --> 00:22:59,160 Speaker 1: of course that was a much different political environment when 373 00:22:59,800 --> 00:23:02,480 Speaker 1: uh Joe Biden was a lot more popular. But as 374 00:23:02,800 --> 00:23:05,920 Speaker 1: the President's popularity has waned a little bit as inflation 375 00:23:06,000 --> 00:23:08,280 Speaker 1: has gone up, the economy is is certainly a lot 376 00:23:08,320 --> 00:23:11,720 Speaker 1: different than it was a year or two ago. Talking 377 00:23:11,760 --> 00:23:15,960 Speaker 1: to Republican strategists and posters, they've they've seen this momentum 378 00:23:16,119 --> 00:23:19,000 Speaker 1: on paper, it's the great time to run as a Republican, 379 00:23:19,280 --> 00:23:22,080 Speaker 1: and yet they're struggling. You see a lot of more 380 00:23:22,119 --> 00:23:25,840 Speaker 1: Democratic enthusiasm in part because of the abortion issue, but 381 00:23:25,920 --> 00:23:29,040 Speaker 1: also the president's approval is coming back, and so yes, 382 00:23:29,119 --> 00:23:32,200 Speaker 1: this is an acknowledgement by Republicans that they need something 383 00:23:32,320 --> 00:23:35,560 Speaker 1: more than maybe just against everything that Joe Biden is doing. 384 00:23:35,800 --> 00:23:37,800 Speaker 1: They need to tell people what they're going to do. 385 00:23:38,119 --> 00:23:41,000 Speaker 1: By the way, that sets up to the table when 386 00:23:41,200 --> 00:23:43,919 Speaker 1: Republicans hope to take back the way out. And the 387 00:23:44,040 --> 00:23:47,000 Speaker 1: thing about this happening though in a mid term election year, 388 00:23:47,040 --> 00:23:51,639 Speaker 1: is that mid terms are primarily about anchor. People do 389 00:23:51,880 --> 00:23:54,639 Speaker 1: come out because they're against something, and that's why it 390 00:23:55,000 --> 00:23:58,240 Speaker 1: usually favors the party that's out of power. Well, now 391 00:23:58,280 --> 00:24:01,280 Speaker 1: here's a very emotional issue that now has energized the 392 00:24:01,280 --> 00:24:05,719 Speaker 1: other side and sort of balanced that. And so the 393 00:24:05,720 --> 00:24:08,040 Speaker 1: only thing that mid terms are is that you talk 394 00:24:08,080 --> 00:24:11,359 Speaker 1: to political scientists, uh, they are thermostatic, and what they 395 00:24:11,359 --> 00:24:13,960 Speaker 1: mean by that is that voters tend to sort of 396 00:24:14,000 --> 00:24:17,480 Speaker 1: adjust the temperature up or down based on where they 397 00:24:17,520 --> 00:24:20,359 Speaker 1: think the center should be. And if voters since that 398 00:24:20,400 --> 00:24:23,240 Speaker 1: the country is moving too far in one direction or 399 00:24:23,280 --> 00:24:26,360 Speaker 1: the other, uh, they'll try to dial the thermostatic back 400 00:24:26,400 --> 00:24:30,800 Speaker 1: to the center. Usually in the president's first two terms, 401 00:24:30,800 --> 00:24:33,880 Speaker 1: the president takes the country in his direction. But there's 402 00:24:33,920 --> 00:24:35,960 Speaker 1: a lot of sort of countervailing factors here, and the 403 00:24:35,960 --> 00:24:39,600 Speaker 1: abortion issue is one where voters might decide that no, uh, 404 00:24:39,920 --> 00:24:42,280 Speaker 1: we we you know, we're maybe moving too far to 405 00:24:42,320 --> 00:24:44,520 Speaker 1: the right on the issue and try to dial the 406 00:24:44,560 --> 00:24:47,280 Speaker 1: country back a little bit more towards the middle. Meanwhile, 407 00:24:47,359 --> 00:24:51,119 Speaker 1: we've been seeing reports some of your reporting the Democrats 408 00:24:51,160 --> 00:24:54,480 Speaker 1: now have been getting more than double the money in 409 00:24:54,560 --> 00:24:57,680 Speaker 1: the bank than Republicans as far as his cofers. Yeah, 410 00:24:57,680 --> 00:25:01,360 Speaker 1: there's two issues here. One is the fundraising and environment 411 00:25:01,440 --> 00:25:04,440 Speaker 1: that we're in for the past of a few cycles 412 00:25:04,640 --> 00:25:07,600 Speaker 1: is really driven by these small dollar donors. Really on 413 00:25:07,640 --> 00:25:10,639 Speaker 1: post side. Trump is very effective in raising money from 414 00:25:10,640 --> 00:25:13,000 Speaker 1: small dollar donors, but also there's a number of people 415 00:25:13,000 --> 00:25:15,240 Speaker 1: on the left and then the Democratic Party that can 416 00:25:15,240 --> 00:25:17,640 Speaker 1: do that as well. But the other issue is also 417 00:25:17,680 --> 00:25:21,240 Speaker 1: the Burnley and Republicans have been spending money this cycle 418 00:25:21,359 --> 00:25:24,240 Speaker 1: earlier than they've had to in part because they're defending 419 00:25:24,320 --> 00:25:25,960 Speaker 1: some seats that they didn't think that they would have 420 00:25:26,000 --> 00:25:29,480 Speaker 1: to defend as aggressively. We've had a number of high 421 00:25:29,560 --> 00:25:33,880 Speaker 1: profile Republican retirements, people like Senator Pat Toomey in Pennsylvania, 422 00:25:33,960 --> 00:25:37,120 Speaker 1: Rob Portman in Ohio, Richard Burr and North Carolina. All 423 00:25:37,160 --> 00:25:40,880 Speaker 1: of those have opened up these currently Republican seats and 424 00:25:41,000 --> 00:25:45,240 Speaker 1: into pretty competitive elections, maybe more competitive than than the 425 00:25:45,320 --> 00:25:47,720 Speaker 1: Republicans had bargain bargain force. So they have to hold 426 00:25:47,760 --> 00:25:50,280 Speaker 1: those seats, us to have to pick up some seats 427 00:25:50,280 --> 00:25:55,720 Speaker 1: in places like Arizona or Georgia if they're going to 428 00:25:55,720 --> 00:25:58,360 Speaker 1: take control of the Senate. And so the Senate map 429 00:25:58,480 --> 00:26:00,679 Speaker 1: is a lot more unpredictable than it was, maybe even 430 00:26:00,760 --> 00:26:02,440 Speaker 1: just a year ago. So then what would be more 431 00:26:02,480 --> 00:26:07,320 Speaker 1: significant for either Republicans or Democrats for any candidate out there. 432 00:26:07,359 --> 00:26:09,640 Speaker 1: Is it money in the coffers or vote or turnout 433 00:26:09,720 --> 00:26:12,200 Speaker 1: or are those so closely linked. It's hard to say, 434 00:26:13,560 --> 00:26:16,000 Speaker 1: you know, I think in the end of at the 435 00:26:16,080 --> 00:26:20,439 Speaker 1: end of the day, elections are decided by vote and 436 00:26:20,560 --> 00:26:23,960 Speaker 1: not money. And there's certainly a number of examples where 437 00:26:24,000 --> 00:26:27,320 Speaker 1: a candidates who spend less money but has an effective 438 00:26:27,320 --> 00:26:30,320 Speaker 1: message can win, but you know, the money can be 439 00:26:30,359 --> 00:26:34,960 Speaker 1: a great equalizer, and so it's not that it's unimportant. 440 00:26:35,600 --> 00:26:37,600 Speaker 1: But I also am starting to get the sense out 441 00:26:37,600 --> 00:26:40,679 Speaker 1: there that, you know, we're just so deluged with these 442 00:26:40,680 --> 00:26:46,119 Speaker 1: political messages, but also people are are are attention is 443 00:26:46,160 --> 00:26:49,040 Speaker 1: so much more fragmented than it was a decade or 444 00:26:49,040 --> 00:26:53,880 Speaker 1: two ago, with people watching consuming their entertainment differently, and 445 00:26:54,240 --> 00:26:57,400 Speaker 1: the political campaigns have been sort of struggling to keep 446 00:26:57,480 --> 00:27:00,400 Speaker 1: up to where people are To get their attention. It's 447 00:27:00,440 --> 00:27:03,480 Speaker 1: not always on the local eleven o'clock news running a 448 00:27:03,560 --> 00:27:05,639 Speaker 1: thirty second add it's gonna get people's attention, people have 449 00:27:05,680 --> 00:27:07,520 Speaker 1: to be a lot more creative and use social media, 450 00:27:08,040 --> 00:27:10,120 Speaker 1: and if they can do that in a cost effective way, 451 00:27:10,880 --> 00:27:13,440 Speaker 1: that can be very effective as well. And we are 452 00:27:13,480 --> 00:27:16,119 Speaker 1: talking about the mid terms and the changing fortunes of 453 00:27:16,160 --> 00:27:22,159 Speaker 1: the GOP. Bloomberg political reporter Gregory Cordy is with us now, Uh, Gregory, 454 00:27:22,400 --> 00:27:25,280 Speaker 1: is the dream of a red wave starting to fade? 455 00:27:25,359 --> 00:27:27,800 Speaker 1: We had almost gotten to the point of thinking it 456 00:27:27,840 --> 00:27:32,240 Speaker 1: was a foregone conclusion. It's largely an expectations game, especially 457 00:27:32,240 --> 00:27:34,240 Speaker 1: in the House. Is we just discussed with the Senate 458 00:27:34,240 --> 00:27:38,080 Speaker 1: that's a little bit unpredictable because Candida quality matters a lot. 459 00:27:38,160 --> 00:27:40,919 Speaker 1: There's only so many chess pieces on the board, and 460 00:27:41,040 --> 00:27:43,720 Speaker 1: in a in a weird year, anything can happen. In 461 00:27:43,760 --> 00:27:45,760 Speaker 1: the House is a lot more predictable that the House 462 00:27:45,840 --> 00:27:49,800 Speaker 1: races are much more tied to the president popularity. And 463 00:27:49,840 --> 00:27:52,520 Speaker 1: as I said, that long term trend all the way 464 00:27:52,560 --> 00:27:55,199 Speaker 1: back to the Civil War is that in all but 465 00:27:55,240 --> 00:27:58,920 Speaker 1: about three or four elections since then, the party out 466 00:27:58,960 --> 00:28:01,959 Speaker 1: of power games seats and very often takes back the 467 00:28:01,960 --> 00:28:05,240 Speaker 1: House if they don't already control it. And so, uh, 468 00:28:05,920 --> 00:28:09,480 Speaker 1: it's sort of baked in. In this cycle, Democrats control 469 00:28:09,520 --> 00:28:12,920 Speaker 1: the House by only about five seats. Uh, any kind 470 00:28:12,960 --> 00:28:16,720 Speaker 1: of a slight wind is going to push Republicans in 471 00:28:16,760 --> 00:28:19,280 Speaker 1: the power there. But again, then it becomes how big 472 00:28:19,280 --> 00:28:22,200 Speaker 1: of a wave is it. In nine and two thousand 473 00:28:22,200 --> 00:28:25,560 Speaker 1: and ten, when during the President Obama's first mid term, 474 00:28:25,840 --> 00:28:28,920 Speaker 1: Republicans pick up sixty three seats, that's sort of the 475 00:28:29,040 --> 00:28:32,200 Speaker 1: high water mark. Nobody expects the Republicans to be able 476 00:28:32,240 --> 00:28:35,879 Speaker 1: to repeat that performance. But a year ago we were 477 00:28:35,920 --> 00:28:39,760 Speaker 1: talking about maybe thirty thirty five, forty seats. Now the 478 00:28:40,080 --> 00:28:44,040 Speaker 1: prognosticators are talking maybe a little more like five seats, 479 00:28:44,040 --> 00:28:46,040 Speaker 1: and some of the models have it as you as 480 00:28:46,280 --> 00:28:51,040 Speaker 1: maybe ten or fifteen. And the size of Kevin McCarthy's 481 00:28:51,360 --> 00:28:54,760 Speaker 1: majority is going to be important if he's going to 482 00:28:55,200 --> 00:28:58,320 Speaker 1: put together a governing coalition that can elect him speaking 483 00:28:58,640 --> 00:29:02,840 Speaker 1: speaker and actually get something done. So yeah, that it's 484 00:29:02,880 --> 00:29:05,600 Speaker 1: not just whether the Republicans take back the House, it's 485 00:29:05,640 --> 00:29:08,880 Speaker 1: how big of a majority they can build, uh, towards 486 00:29:08,960 --> 00:29:14,040 Speaker 1: momentum towards There's been a lot of attention paid to 487 00:29:14,200 --> 00:29:16,480 Speaker 1: the I don't want to call it a chasm, but 488 00:29:17,040 --> 00:29:21,880 Speaker 1: a bit of a rift, let's say, between progressive Democrats 489 00:29:22,200 --> 00:29:25,720 Speaker 1: and your more traditional middle of the road Democrats. If 490 00:29:25,720 --> 00:29:27,800 Speaker 1: we could turn the spotlight a minute onto the GOP, 491 00:29:28,080 --> 00:29:31,920 Speaker 1: there is a similar rift there some open feuding between 492 00:29:31,920 --> 00:29:35,720 Speaker 1: say Florida Senator Rick Scott Minority Leader Mitch McConnell um. 493 00:29:35,840 --> 00:29:38,040 Speaker 1: Give us some insight and a little shine, a little 494 00:29:38,120 --> 00:29:40,959 Speaker 1: light on what's going on behind the scenes. Yeah. Rick 495 00:29:41,000 --> 00:29:45,040 Speaker 1: Scott is the Republican Senator from Florida, and he's important 496 00:29:45,080 --> 00:29:49,960 Speaker 1: because he is the chairman of the National Republican Senatorial Committee, 497 00:29:49,960 --> 00:29:53,760 Speaker 1: that's the fundraising and campaign arm of Senate Republicans. And 498 00:29:53,880 --> 00:29:58,400 Speaker 1: it's his job to get Republicans elected in Senates so 499 00:29:58,480 --> 00:30:02,200 Speaker 1: that Republicans can take back control of the Senate. Mitch McConnell, 500 00:30:02,400 --> 00:30:05,440 Speaker 1: the Senator from Kentucky, is the minority leader, the Republican 501 00:30:05,520 --> 00:30:07,760 Speaker 1: leader in the Senate, and so it's also his job 502 00:30:07,840 --> 00:30:09,760 Speaker 1: to do that. But there they didn't sort of a 503 00:30:09,840 --> 00:30:12,680 Speaker 1: cross purposes at times of the past few months. And 504 00:30:12,720 --> 00:30:15,520 Speaker 1: I'll started earlier this year when ricks Got built his 505 00:30:15,560 --> 00:30:18,800 Speaker 1: own platform without really talking to anybody else in the 506 00:30:18,840 --> 00:30:21,320 Speaker 1: Republican caucus in the Senate, that they would talk about 507 00:30:21,440 --> 00:30:25,680 Speaker 1: things like sun setting every federal law but putting on 508 00:30:25,720 --> 00:30:29,280 Speaker 1: a deadline so every federal law would expire after five years. 509 00:30:29,320 --> 00:30:31,520 Speaker 1: And Democrats were quick to point out that would include 510 00:30:31,520 --> 00:30:34,800 Speaker 1: programs like Medicare and Social Security that a lot of 511 00:30:34,800 --> 00:30:38,160 Speaker 1: Americans depend on. But also making sure that everybody pays 512 00:30:38,160 --> 00:30:40,760 Speaker 1: at least some tax, which would obviously be a uh 513 00:30:40,760 --> 00:30:43,600 Speaker 1: an in tax increase on some of the poorest Americans. 514 00:30:43,600 --> 00:30:46,520 Speaker 1: Not a popular idea in in either party as it 515 00:30:46,520 --> 00:30:49,280 Speaker 1: turns out. So that was the policy riff that started this, 516 00:30:49,360 --> 00:30:51,760 Speaker 1: and now there's sort of a disagreement on Republican strategy 517 00:30:51,800 --> 00:30:54,200 Speaker 1: and trying to take back the Senate. Uh, in terms 518 00:30:54,200 --> 00:30:56,880 Speaker 1: of what races to focus on, what the fundraising strategy 519 00:30:56,920 --> 00:30:59,400 Speaker 1: should be, that the spending strategy should be. And so 520 00:30:59,440 --> 00:31:03,440 Speaker 1: now Mitch mc conall is uh, sort of really focusing 521 00:31:03,440 --> 00:31:06,160 Speaker 1: on his own effort. He's got his own separate campaign 522 00:31:06,160 --> 00:31:09,000 Speaker 1: effort called the Senate Leadership Fund, trying to raise money 523 00:31:09,000 --> 00:31:11,320 Speaker 1: in a super packet. It's to support Republican candidates for 524 00:31:11,360 --> 00:31:14,640 Speaker 1: the Senate. He's complained about candidate quality being an issue. 525 00:31:14,920 --> 00:31:16,560 Speaker 1: There are a lot of candidates on the ballot for 526 00:31:16,600 --> 00:31:21,040 Speaker 1: Republican that have no prior political experience, but they got 527 00:31:21,040 --> 00:31:23,920 Speaker 1: there because they had the endorsement of former President Trump 528 00:31:24,560 --> 00:31:28,840 Speaker 1: UM and so that there's But basically what this all 529 00:31:28,880 --> 00:31:31,720 Speaker 1: comes down to is things aren't going quite as planned 530 00:31:31,760 --> 00:31:35,760 Speaker 1: for Republicans. Uh. And though maybe there's already some finger 531 00:31:35,800 --> 00:31:39,960 Speaker 1: pointing going on in case things don't work out and 532 00:31:40,040 --> 00:31:42,320 Speaker 1: Democrats continue to hold the Senate or maybe even pick 533 00:31:42,400 --> 00:31:45,160 Speaker 1: up seats. All right, thank you, Gregory so much. Gregory 534 00:31:45,160 --> 00:31:47,960 Speaker 1: Cordy covers politics for Bloomberg News, and that is what 535 00:31:48,120 --> 00:31:50,480 Speaker 1: is going on in the nation's capital. For more of 536 00:31:50,480 --> 00:31:52,800 Speaker 1: our political news coverage, you can tune into Balance of 537 00:31:52,840 --> 00:31:56,120 Speaker 1: Power with David Weston weekdays at noon Wall Street Time, 538 00:31:56,440 --> 00:31:58,480 Speaker 1: and sound On with Joe Matthew week days at five 539 00:31:58,520 --> 00:32:01,880 Speaker 1: pm Wall Street Time. Right here on Bloomberg Radio, I'm 540 00:32:01,920 --> 00:32:04,840 Speaker 1: Amy Morris and this is Bloomberg. Nathan. All right, thank 541 00:32:04,880 --> 00:32:07,120 Speaker 1: you Amy. That was Amy Morris reporting from our Bloomberg 542 00:32:07,800 --> 00:32:10,240 Speaker 1: newsroom in the nation's capital. And that does it for 543 00:32:10,280 --> 00:32:13,400 Speaker 1: this edition of Bloomberg day Break Weekend. Join us again 544 00:32:13,520 --> 00:32:16,600 Speaker 1: Monday morning, five am Wall Street Time for the latest 545 00:32:16,640 --> 00:32:19,120 Speaker 1: on markets overseas and all the news you need to 546 00:32:19,200 --> 00:32:23,240 Speaker 1: start your day. I'm Nathan Hagrin and this is Bloomberg