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Speaker 2: Glenn Cubboard had the privilege of stunding under Benjamin Friedman,
Speaker 2: who took our economics and our society and pieced it together.
Speaker 2: Glenn Hubbard definitive at Columbia Business School, his public service
Speaker 2: to the nation as well. I was watching King Charles
Speaker 2: Third Glen Hubbard yesterday and you could feel the calm
Speaker 2: come across Republicans and Democrats. You are affiliated with a
Speaker 2: Republican tendency. What does that Congress that we saw yesterday
Speaker 2: and the Republicans, what do they look like after Trump?
Speaker 3: Well, I think from the King's remarks, you know, good
Speaker 3: policy runs deep. I think the King was calling for
Speaker 3: a return to openness in markets, in trade, in tolerance.
Speaker 3: I think all those things have been a hallmark of conservatism.
Speaker 3: I think there's also a real opportunity to pivot while
Speaker 3: President Trump is here, of course, to growth, to opportunity
Speaker 3: and to full participation in the economy.
Speaker 2: The anger that's out there says that many people are
Speaker 2: not enjoying growth. How do we pull them into growth?
Speaker 3: Well, first, we've got to get growth itself up, and
Speaker 3: that's going to require some things that might be controversial
Speaker 3: right now. More spending on research, more high skilled immigration,
Speaker 3: a better policy toward AI and electricity generation. We need
Speaker 3: all of those things. To get more people into growth
Speaker 3: requires much more investment in people, better training, better resources,
Speaker 3: and better working with companies to do that.
Speaker 2: Nancy Lazar has been brilliant enough. Paul in market economics.
Speaker 4: Professor, the war in the Middle East, it's obviously a
Speaker 4: wreaking havoc on a lot of economic parts of the
Speaker 4: economy here, most notably in the energy markets. Is it
Speaker 4: to the point where you're concerned about its impact on
Speaker 4: global economic growth? Is a recession something that that could
Speaker 4: result from kind of this instability we're seeing.
Speaker 3: Well, it certainly could, but I don't think it's the
Speaker 3: likeliest outcome. Remember, the United States in particular is much
Speaker 3: less energy intensive than in previous shocks. I think what's
Speaker 3: more likely is a slowdown in growth combined with inflation
Speaker 3: being uncomfortably stuck, which is one of the problems the FED.
Speaker 3: Of course we'll have to deal with today.
Speaker 4: What do you expect from the FED today? And then
Speaker 4: I guess, just as importantly from the new Federal Reserve
Speaker 4: Chairman Kevin warsh.
Speaker 3: Well, I don't expect any change in the funds rate today.
Speaker 3: It'll be interesting to see if there's any change in
Speaker 3: the language in the FOMSC statement. I think incoming chairwash
Speaker 3: has been pretty clear he wants to look at all
Speaker 3: of the data. He has a very clear story about
Speaker 3: AI going forward. The time path there though maybe a challenge.
Speaker 3: I don't expect a lot of rate cuts from the
Speaker 3: FED in the very near term, even under a worsh
Speaker 3: FED chair.
Speaker 4: So if the growth story may be slowing, I guess
Speaker 4: probably maybe the bigger concern for the marketplace is just
Speaker 4: inflation out there. Again, we're looking at the cost of energy,
Speaker 4: whether it's gasoline or diesel fuel or jet fuel. And
Speaker 4: again not as big an issue here as it is
Speaker 4: in other parts of the world, but that's going to
Speaker 4: be a concern.
Speaker 3: Yes, but it's more than that. I remember inflation was
Speaker 3: a problem before February twenty eighth. Inflation was well above
Speaker 3: the Fed's target and appeared to be stuck. The energy
Speaker 3: prices may be more of a one off, But the really,
Speaker 3: as many beneficials have commented, is do expectations become unhinged? So, yes,
Speaker 3: inflation is a real problem.
Speaker 2: Is we excidout at Glenn Hubbert? Can I do an audible?
Speaker 3: Sure?
Speaker 2: Let it right, Glenn. I don't think you've gotten nearly
Speaker 2: the credit with Lee Bollinger of the miracle rot at
Speaker 2: the Columbia Business School Rocket, What was it like the
Speaker 2: first meetings where you had a vision to blow it up?
Speaker 2: And by why? To claim Colombia is the juggernaut that
Speaker 2: you and others developed is unparalleled across this nation. How
Speaker 2: did that happen?
Speaker 3: Well, it happened with a lot of people. And first,
Speaker 3: I'd like to give a lot of credit to be Bolinger. Actually,
Speaker 3: his vision for this campus was a big part of it.
Speaker 3: But it's really a story about the business community, about alumni,
Speaker 3: about students, about faculty. It's always been a great school
Speaker 3: and it's come together. I'm very proud of it.
Speaker 2: I mean, did you like have lunch with David Geffen
Speaker 2: and say, David, we've got to do this. No?
Speaker 3: No, He's been very generous to the school.
Speaker 2: Oh, Glenn Aulberd, thank you so much. And all I
Speaker 2: can say, did you hire did you bring Abby Joseph
Speaker 2: Cohen over from Goldacs? Is that your fault? That's my blessing.
Speaker 2: That's wonderful, Glenn Albert, thank you so much, and seriously
Speaker 2: congratulations for those of you across this nation and worldwide
Speaker 2: what the Bolinger Combine at Columbia University did with their
Speaker 2: business school. It's called Manhattanville. Yeah, new buildings. It's right
Speaker 2: in the Hudson River.
Speaker 4: Half of Global Wall Street, I think came out of
Speaker 4: the Columbia.
Speaker 2: Henry Kravis stepped up on this along with mister Geffen
Speaker 2: and others, and they brought in Abby Joseph Cohen and
Speaker 2: we looked sord of speaking to from time to time.
Speaker 2: Glenn Hubbard. There, stay with us. More from Bloomberg Surveillance
Speaker 2: coming up after this.
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Speaker 1: weekday afternoons from seven to ten am Eastern Listen on
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Speaker 2: We are so gifted, folks. Got a great conversation today,
Speaker 2: Sea Micheawe. Glenn Hubbard, the giant of Colombian supply side economics,
Speaker 2: will be with He hates when I say that. Probably
Speaker 2: in the car right now, I saying, turn a limo around.
Speaker 2: Michael Ball will be with us. Has been on fire.
Speaker 2: Jeff Cleveland an ain't dollars a gallon gas in LA.
Speaker 2: We're gonna go narrow now. Libby Cantrell's like, what's the
Speaker 2: Fed gonna do? What are the Democrats gonna do? You
Speaker 2: weren't at the steak dinner last night. I was not
Speaker 2: at the same. Okay, I thought you were shortlisted as well.
Speaker 5: I'm sure.
Speaker 2: I'm sure it was.
Speaker 4: I didn't review the list.
Speaker 2: Oh did you some notable folks there or something? Yeah,
Speaker 2: well it's the way. They weren't in a ballroom. No,
Speaker 2: they were not. Lebby. I want to go wicked narrow ready,
Speaker 2: folks three two one. Jacob javetts In nineteen seventy two,
Speaker 2: the world was blowing up in in nineteen seventy three, Watergate, Vietnam,
Speaker 2: the Red Sox were terrible. All of it came together
Speaker 2: and the answer is Jacob Javits and a few others
Speaker 2: said we need to bring back our power the War
Speaker 2: Powers Act? How will that play out May one and beyond.
Speaker 6: Yeah, so this is going to be the big question
Speaker 6: for particular for Republicans. Republicans, of course, have effectively greenlighted
Speaker 6: this conflict in Iran. Publicly, they've supported and endorsed President
Speaker 6: Trump mostly unequivocally. I think privately there's been more skepticism
Speaker 6: and I think there is more growing ambivalence about this
Speaker 6: conflict in terms of what are the strategic objectives, what
Speaker 6: is the endgame? And there will be a vote in Congress,
Speaker 6: and that is because the War Powers Act, it's a
Speaker 6: sixty day requirement per this law that when the president
Speaker 6: has deployed troops that Congress ultimately needs to vote on it. Now,
Speaker 6: there's a thirty day grace period, which most likely the
Speaker 6: president will use that option, if you will, So that
Speaker 6: means that vote will be at the end of May.
Speaker 6: But I think push comes a shove. Congress is actually
Speaker 6: gone to go on the record on this. The other
Speaker 6: one important point here is there's going to be a
Speaker 6: big supplemental request that is different from the one and
Speaker 6: a half trillion dollar budget requests that's for next year.
Speaker 6: The two hundred billion dollars supplemental requests. We haven't gotten
Speaker 6: any details of it. We've just sort of had, you know,
Speaker 6: there's been kind of trial balloons or what have you.
Speaker 6: But that is the other kind of forcing issue, and
Speaker 6: I would say that's probably more important than the War
Speaker 6: Powers Act, which is like more symbolic. But really when
Speaker 6: kind of the rubber meets the road, so to speak,
Speaker 6: is going to be in that funding bill, and I
Speaker 6: think some Republicans will probably support it, but I think
Speaker 6: there's gonna be much more pushback and you'll see that
Speaker 6: probably with Secretary Hegseth.
Speaker 4: Is that funding bill that two hundred million dollars is
Speaker 4: that have implications for the wars. Some of that two
Speaker 4: hundred million earmarked for the warner in So therefore, if
Speaker 4: you your vote on that will be kind of your
Speaker 4: vote on the war.
Speaker 6: Yes, And I think that they're I mean, you know,
Speaker 6: I'm sure the White House will characterize this as just
Speaker 6: trying to restock these depleted ammunitions, and I do think
Speaker 6: that's pretty shocking. Any the American public is sort of
Speaker 6: surprised that we actually don't have this sort of arsenal
Speaker 6: of munitions, and of course we've depleted those through into
Speaker 6: both through Ukraine and through Iran. So I think they'll
Speaker 6: probably characterize this as just trying for preparedness against China
Speaker 6: and what have you. But push comes to schev I
Speaker 6: think this probably will be at least in part, a
Speaker 6: referendum on the Iranian conflict. And I mean two hundred
Speaker 6: million dollars, it's a lot of money. I mean, this
Speaker 6: is not for nothing, even for Washington. I mean these
Speaker 6: one we're kind of a neure to these these numbers.
Speaker 6: But it's a.
Speaker 2: Lot politics here.
Speaker 4: Does the president not really care about politics and the
Speaker 4: fact that it is a mid term election year because
Speaker 4: tariffs don't pull well, the war in Iran is not
Speaker 4: polling well. I would think a lot of Republicans facing
Speaker 4: a race this year would be kind of nervous.
Speaker 6: Yeah, And I think what we've been saying to our
Speaker 6: clients from the beginning of Trump two point zero is
Speaker 6: president Trump if you compare him to one point zero,
Speaker 6: where he was really focused on the approval ratings and
Speaker 6: of you know, Republicans, you know, keeping the House, which
Speaker 6: of course they did not in twenty eighteen. This is different, right.
Speaker 6: He has a sense of urgency, has his view of
Speaker 6: unfinished business. I think Iran, tariffs, Venezuela all kind of
Speaker 6: fit within that framework. So does he care about Republicans? Yes,
Speaker 6: does he want to keep the House, of course, I
Speaker 6: mean everyone likes power and Washington. However, I do think
Speaker 6: he has his eye on this sort of bigger, more
Speaker 6: symbolic legacy making issues.
Speaker 2: I watch every minute I hit the blue button, the
Speaker 2: Detroit Ryons blue Button Lebby Cantrell. I watched every minute
Speaker 2: of the King's speech yesterday, not the movie, the actual speech.
Speaker 2: And in the back when you were in the house,
Speaker 2: were you one of those young interests?
Speaker 6: I was, yes, I usually wasn't on the house floor,
Speaker 6: but were young.
Speaker 5: I know they're very young.
Speaker 2: What do they do?
Speaker 6: Congress, by the way, is run by a bunch of
Speaker 6: twenty year olds, so it seems that way. It's because
Speaker 6: it is now. They're smart twenty year olds. But well,
Speaker 6: those those may be pages, you know, and they're they're
Speaker 6: they're bringing documents, they're bringing coffee to the coffee and peach.
Speaker 2: I mean, yeah, these are, but these.
Speaker 6: Are important jobs, Tom.
Speaker 2: People need to get me to the Capitol grill and
Speaker 2: I want a medium where don't bring in needed.
Speaker 6: To be sustained one thing on that that speech, if
Speaker 6: I may please, I thought it was really important and
Speaker 6: interesting that members of Congress applauded when he talked about NATO.
Speaker 6: And the reason why I think a lot of a
Speaker 6: lot of our clients don't appreciate this is Congress has
Speaker 6: the final vote on a withdrawal from NATO. That was
Speaker 6: Secretary then Senator Rubio's kind of last gasp. He actually
Speaker 6: passed the bill Biden passed into Senate and to start
Speaker 6: into a lot about the Congress needs to authorize NATO withdrawal.
Speaker 6: And so I think that was important that they all
Speaker 6: clapped when he talked about the importance.
Speaker 2: And you missed it. I mentioned this earlier, folks, and
Speaker 2: I will say it again. And I think Liby Will
Speaker 2: you were in the Bentley on her way over. Yeah,
Speaker 2: of course she was tuned the you know Yankees baseball
Speaker 2: or Broncos radio on sirious way and then Libya I
Speaker 2: just said, you have to listen to this speech from
Speaker 2: another time and place, and you could feel the room relaxed,
Speaker 2: all parties, everybody just for a moment relaxed. Don't know
Speaker 2: what it means, but there it was.
Speaker 6: I think it was the most unified Congress has been
Speaker 6: since the beginning of this Congress, right and twenty twenty five.
Speaker 6: So it is it's at of ironic that became.
Speaker 2: I need you bet May six, May seven, May eight,
Speaker 2: as we go past the word powers that let me
Speaker 2: cantrell definitive at pimcos. Stay with us. More from Bloomberg
Speaker 2: Surveillance coming up after this.
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Speaker 2: We haven't talked about gold and ages with State s
Speaker 2: Treed Investment Management. Alkharstochi joins US now head of Gold Strategy.
Speaker 2: Just as simple as I can. What are the Chinese doing?
Speaker 7: The Chinese are buying gold as the West was unwinding
Speaker 7: holdings in March. Chinese investors continue to have inflows. The
Speaker 7: PBOC People's Bank of China continued to buy and add
Speaker 7: to their gold reserves, and you saw bar and coin
Speaker 7: demand actually spike up in China.
Speaker 2: Buy it. Do they go down to Singapore? They hang
Speaker 2: out at the raffles hotel over the Fullerton and yeah,
Speaker 2: I'll take that.
Speaker 7: So they buy it in the onshore market, and there's
Speaker 7: been an incentive to export gold from the rest of
Speaker 7: the world into mainland China like they're galleons.
Speaker 2: It's like the Spanish from Batavia are there like boats
Speaker 2: carrying gold. There are boats carrying gold.
Speaker 7: Some comes by airplane as well, and most of it
Speaker 7: clears in the Shanghai Gold Exchange and that market has
Speaker 7: been at a premium to London for the last several weeks,
Speaker 7: and I think that shows that there's very strong local
Speaker 7: demand for gold, even as Western investors were taking some
Speaker 7: profits and liquidating some holdings over the last month or
Speaker 7: so since they're on conflicts started.
Speaker 4: Why is the Bank of China buying gold.
Speaker 7: I think it's part of a long term, medium term
Speaker 7: trend of de dollarization, reserve diversification and really using gold
Speaker 7: old as as a hedge against potential US sanctions policy
Speaker 7: and geopolitical fragmentation, a trend I expect to continue over
Speaker 7: the medium term.
Speaker 4: So it's not so much an investment for them, but
Speaker 4: it has maybe geopolitical bearings to it as well.
Speaker 7: Sure gold can't be sanctioned if it's held in physical form.
Speaker 7: It doesn't actually have any credit risk. It's a bearer asset.
Speaker 2: Tom.
Speaker 7: If we go back to bearer bonds and from the
Speaker 7: nineteen eighties, you could.
Speaker 1: Just go.
Speaker 2: There's three thousand people, look at your next I'm the
Speaker 2: only one that clip Cooper.
Speaker 4: So what's the call here as to the fundamentals of gold?
Speaker 4: How do we think about golden? I know it's a commodity,
Speaker 4: but is it expensive? Is it not expensive? Should I?
Speaker 2: Is there value?
Speaker 4: How did gold investors think about that?
Speaker 7: The SMP five hundred was at levels we were a
Speaker 7: year ago in April of twenty twenty five, then I would.
Speaker 2: Say gold is relatively rich.
Speaker 7: But at seven thousand, as INP five hundred, I think
Speaker 7: gold at forty five hundred still provides you that left tail,
Speaker 7: low volatility reserve asset feel From that standpoint, what's been
Speaker 7: a headwind into quarter end of one Q has been
Speaker 7: higher real yields.
Speaker 2: This war impact has.
Speaker 7: Changed fed pricing. If you look right before the war
Speaker 7: started at the end of February, we were looking at
Speaker 7: fifty eight basis points of cumulative easing for twenty twenty six.
Speaker 7: At one point in March, the third week of March.
Speaker 7: I think we were looking at the fifty to fifty
Speaker 7: potential of a hike. Now we're at a FED that's
Speaker 7: on hold for longer. I think the key for gold
Speaker 7: here is the FED can be on hold so long
Speaker 7: as they're going to cut, gold will do okay. Remember
Speaker 7: last year in twenty twenty five, FED was on hold
Speaker 7: for nine months, gold returned forty three percent. So it's
Speaker 7: a little bit of a push and pull friction what's
Speaker 7: happening right now. Arguably, I think the war enhances the
Speaker 7: case long term for gold because it's adding to debt
Speaker 7: and deficits. The war spending higher yields will add to
Speaker 7: interest costs for governments around the world. And then I
Speaker 7: think on the geopolitical fragmentation point, this can increase the
Speaker 7: risk that emerging market central banks will further want to
Speaker 7: diversify reserves with.
Speaker 2: What does the cultural overlay of the Eastern Mediterranean and
Speaker 2: down to the Middle East of gold given conflict, given war.
Speaker 7: It tends to be quite strong In the East. Gold
Speaker 7: is seen as a store of wealth, it's not just
Speaker 7: a risk off asset. So if GDP is rising, if
Speaker 7: wealth is rising, if consumers are and demographic shifts are
Speaker 7: occurring that are positive. That tends to be positive for
Speaker 7: gold demand. It's not just a risk off story out
Speaker 7: in the East.
Speaker 2: What's your interpretation, I mean, I know gold' you're remat,
Speaker 2: but what's your interpretation of the distillate markets? Are we
Speaker 2: getting visible and clear pricing on all the different oil derivatives?
Speaker 7: You know, that is something that has to be closely
Speaker 7: monitored because as high as oil prices have been, product
Speaker 7: prices have scorched even higher. I think we're in a
Speaker 7: risky regime where twenty twenty six is looking analogous to
Speaker 7: twenty twenty two. I'm surprised equity markets have been this
Speaker 7: strong so far. And how the evolution of oil prices go,
Speaker 7: we'll have a transmission mechanism to other asset markets, particularly
Speaker 7: gold as well through the Fed and dollar channel.
Speaker 2: Real needed this a custos. You thank you so much
Speaker 2: for State Street Investment Management. They're on gold again. Is
Speaker 2: note is absolutely brilliant, Really terse. Look for that from
Speaker 2: State Street Investment Management as we protect their copyright. Stay
Speaker 2: with us. More from Bloomberg Surveillance coming up after this.
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Speaker 2: Suzanne Maloney absolutely definitive at Workings Institute and Foreign Affairs
Speaker 2: Magazine of piecing together where we are in this war? Suzanne,
Speaker 2: what is your uncertainty this morning? And your uncertainty after
Speaker 2: a presidential tweet at four am that frankly could have
Speaker 2: been out of Mad magazine from my childhood.
Speaker 5: Well, you know, I think we're in a very unpredictable
Speaker 5: situation right now. The President and the Iranians appear to
Speaker 5: be in a standoff around who can last longer under
Speaker 5: severe economic pressure. The President is determined to maintain the
Speaker 5: blockade on Iran, preventing them from exporting and earning revenues
Speaker 5: from their oil production, which is the primary source of
Speaker 5: support for the regime and for the country as a whole.
Speaker 5: The Uans are determined to maintain their choke hold on
Speaker 5: the straight of hormones, which we'll have catastrophic implications over time.
Speaker 5: Nowers for oil price, but for the larger global economy.
Speaker 2: Susan, your heritage, I'm going to editorialize is realist foreign
Speaker 2: policy of Robert Gates. It's a big new Brazinski and others.
Speaker 2: Do we have a theory right now a foreign policy?
Speaker 2: Are we realist? Are we something else? I don't know?
Speaker 2: Are we just making it up by tweet?
Speaker 1: Well?
Speaker 5: I think the America First ideology has morphed over time
Speaker 5: under President Trump's first and second terms. At this point,
Speaker 5: it is highly militaristic. It is very much forced first
Speaker 5: as a means of asserting American interests around the world,
Speaker 5: and it is very disinterested in the traditional reliance on
Speaker 5: allies and partners that has been the key to the
Speaker 5: extension of American influence, as well as the broader prosperity
Speaker 5: and piece that we've had in the post World War
Speaker 5: two era Susanne.
Speaker 4: Do we actually know who is running Iran right now?
Speaker 4: And whoever that is, is that a group that can
Speaker 4: really negotiate on behalf of the country.
Speaker 5: I think we have a decent sense of the most
Speaker 5: important figures within the regime. They're largely drawn from the
Speaker 5: Revolutionary Guard, but of course we believe that Mosch Tabahameny,
Speaker 5: the son of the late Supreme Leader who was killed
Speaker 5: on the first day of the war and then elevated
Speaker 5: to his father's position, is still alive and is still
Speaker 5: helping to shape decision making. This is very much a
Speaker 5: system now that is driven by hardliners who have been
Speaker 5: at the forefront of Iran's most damaging and violent policies
Speaker 5: over the course of the past forty seven years. And
Speaker 5: they're not individuals who are particularly prone to compromise or
Speaker 5: to reconciliation with the United States or Israel.
Speaker 4: So President Trump portrays the leadership in Iran is in
Speaker 4: flux failing. Maybe is that accurate?
Speaker 2: Do you think? Again?
Speaker 4: It just kind of goes to the question of ken
Speaker 4: the United States negotiate in good faith with whomever is there.
Speaker 5: Look, Iran has always had a kind of diversity of
Speaker 5: factions within a system and really bociferous debates about both
Speaker 5: its foreign policy and its domestic policy. That isn't new,
Speaker 5: and it's not surprising that in the aftermath of the
Speaker 5: elimination of the senior echelons of the clergy as well
Speaker 5: as the security of bureaucracy, that we're seeing at least
Speaker 5: some questions about how decisions are being made in different positions.
Speaker 5: I don't think that that is fundamentally, it makes it
Speaker 5: impossible for us to negotiate with Iran. It has always
Speaker 5: been complicated, It has always required a high degree of
Speaker 5: focus and patients from the international community to achieve any
Speaker 5: clear outcomes with Iran. I think the challenge that we
Speaker 5: face is not the internal politics, but the sense within
Speaker 5: the regime that they have the upper hand and the
Speaker 5: time is on their side.
Speaker 2: Suzanne Maloney with US Folks a definitive on this study
Speaker 2: of the Eastern Mediterranean and Levon. She's a Brookings Institution
Speaker 2: and of course writing for foreign policy as well as
Speaker 2: foreign Affairs, I should say, which I can't say enough
Speaker 2: about Suzanne. Long ago and far away, you were actually
Speaker 2: in Tehran. Did you ever take a bus like the
Speaker 2: four hour bus south from Tehran to Istefan? Did you
Speaker 2: do that as a kid?
Speaker 5: I visited Isbahan several times when I was studying in
Speaker 5: Iran in the late nineteen nineties. I actually flew with
Speaker 5: the flights were very inexpensive at that time and very convenient.
Speaker 5: Isfahan is a phenomenally beautiful historic city, but it is
Speaker 5: obviously proximate to some of the most important nuclear lights
Speaker 5: in the system.
Speaker 2: What's the number one thing we get wrong in our
Speaker 2: perception of the road from Tehran to Istefan.
Speaker 5: I think the fundamental issue that we have is recognizing
Speaker 5: that this is a regime that has staked its existence
Speaker 5: on maintaining some kind of a nuclear infrastructure. They have
Speaker 5: fought for that. They have suffered enormous trillions of dollars
Speaker 5: of damage and sanctions and lost opportunities as a result
Speaker 5: of their determination to maintain that. The President walked away
Speaker 5: from the nuclear deal in twenty eighteen. There were lots
Speaker 5: of critics of that deal, but it is very hard
Speaker 5: to reconstitute any kind of an agreement given all that
Speaker 5: has happened in the in the interim. So this is
Speaker 5: a challenge. The US wants a quick fix, a quick deal,
Speaker 5: a quick end to the closure of the Strait of Hormuz.
Speaker 5: The Iranians are going to try to continue to maintain
Speaker 5: their choke hold and assert this leverage even after this
Speaker 5: conflict ends.
Speaker 4: Suzanne, what do we know about the people of Iran?
Speaker 4: What do they want? How supportive of the are they
Speaker 4: of this government? Because boy, not just the sanctions, as
Speaker 4: you mentioned, but now the blockade I'm sure is wreaking
Speaker 4: tremendous hardship on the people of Iran. What do we
Speaker 4: know about them?
Speaker 5: Well, the Iranian people have been the biggest losers in
Speaker 5: all of these conflicts between their regime and the international community.
Speaker 5: They have suffered immensely, and of course we know that
Speaker 5: thousands went to the streets all around the country on
Speaker 5: multiple occasions, but most recently back in January, demanding regime change,
Speaker 5: a different government. They do not want the theocratic regime
Speaker 5: that imposes so many constraints on their interaction with the world,
Speaker 5: on their own opportunities. They were slaughtered in very large numbers.
Speaker 5: We've documented, credible organizations have documented seven thousand deaths. Is
Speaker 5: probably two or three times that number at least were
Speaker 5: killed by the regime in order to maintain its hold
Speaker 5: on power. And I think that gives you a sense
Speaker 5: of how determined they are.
Speaker 2: This is the time that we've got I got eight
Speaker 2: ways to go here. Let me start with you know
Speaker 2: how I learned about shuttle diploma. We already Kissinger's diplomacy
Speaker 2: covered a cover and then he reinvented it by getting
Speaker 2: on airplanes. How do you perceive as a diplomac and
Speaker 2: someone who believes in international relations, the idea that a
Speaker 2: real estate developer from New York and a family member
Speaker 2: get on a plane to go negotiate like this, or
Speaker 2: the Vice president for that matter. Do we have a
Speaker 2: diplomatic industry now negotiating with they we're on in this war?
Speaker 5: Well, I believe that the team that was sent to
Speaker 5: Islamabad and was prepared to return did in fact include
Speaker 5: a number of technical experts who would be supporting the
Speaker 5: Leeds Steve Woodcoff, Jared Kushner and Vice President Vance in
Speaker 5: the initial outcome. But truthfully, you know, we are operating
Speaker 5: in very unprecedented times in terms of how we have
Speaker 5: tried to manage these negotiations, and I think we see
Speaker 5: the result of that.
Speaker 2: My answer is my deep readier pop is a blockade?
Speaker 2: Is Russell Kroll on a boat in the Napoleonic Wars.
Speaker 2: It makes for hell of a good movie. If you
Speaker 2: read Patrick O'Brien, What does Suzan Maloney think about the
Speaker 2: simple word blockade? When we mentioned the Persian Gulf and
Speaker 2: around the South.
Speaker 5: It will certainly hurt Around's economy, But I think most
Speaker 5: experts on Iranian politics and on the regime believe that
Speaker 5: they're prepared to pay the price, and that they have
Speaker 5: over the past forty seven years learned to adapt. Their
Speaker 5: entire economy is based on evading US sanctions and mitigating
Speaker 5: the impact of American economic pressure, and they will look
Speaker 5: for workarounds and they will probably succeed longer than we
Speaker 5: would like them to.
Speaker 4: Given that backdrop, Suzanne, and given what we know now
Speaker 4: eight weeks into this, what is a reasonable solution here
Speaker 4: and what is a reasonable timeframe?
Speaker 5: I think it's critical to reopen the straight up horomos
Speaker 5: to something resembling pre war traffic. It will take some
Speaker 5: time before we get there, and so the sooner we
Speaker 5: actually agree on some kind of reopening, the closer we
Speaker 5: are to addressing the really big tsunami of economic pain
Speaker 5: that is coming as a result of this closure.
Speaker 2: Suzan, let's end with this. Paul had the correct question,
Speaker 2: like who are It's like Cassidy. I know, Suzanne Maloney
Speaker 2: saw Butch Cassidy. You know you're looking out and you're going,
Speaker 2: who are these guys? Your essay the Third Islamic Republic?
Speaker 2: Are we speaking to the leaders of the Third Islamic Republic?
Speaker 5: We are speaking to the leaders of the Third Islamic
Speaker 5: Republic they're still trying to make up their minds. But
Speaker 5: I do think that the only way that we can
Speaker 5: come to an end here is through some kind of
Speaker 5: a diplomatic negotiation. And the more that we invest in
Speaker 5: seriance diplomacy, the closer will be to a solution.
Speaker 2: Susan, thank you so much. Just thrilled to have you
Speaker 2: in today. Suzanne Maloney with us and I will get
Speaker 2: it out on the LinkedIn and Twitter folks. Her essay
Speaker 2: Foreign Affairs, a third Islamic Republic is just absolutely definitive.
Speaker 2: Award's unintended consequences for Oran, the Middle East and a
Speaker 2: global order. Suzanne Maloney, thank you so much.
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