1 00:00:02,720 --> 00:00:10,559 Speaker 1: Bloomberg Audio Studios, podcasts, radio news. You're listening to the 2 00:00:10,600 --> 00:00:14,560 Speaker 1: Bloomberg Intelligence podcast. Catch us live weekdays at ten am 3 00:00:14,600 --> 00:00:17,880 Speaker 1: Eastern on Apple Coarclay, and Android Auto with the Bloomberg 4 00:00:17,920 --> 00:00:21,040 Speaker 1: Business App. Listen on demand wherever you get your podcasts, 5 00:00:21,360 --> 00:00:23,560 Speaker 1: or watch us live on YouTube. 6 00:00:24,400 --> 00:00:26,040 Speaker 2: Lots of news flow out today. We want to get 7 00:00:26,040 --> 00:00:28,320 Speaker 2: back to some earnings. Are good friends of Charles Schwab. 8 00:00:28,760 --> 00:00:30,760 Speaker 2: They put up some some pretty good numbers taking in 9 00:00:30,880 --> 00:00:33,319 Speaker 2: more assets. It just blows me away. Here. Let's get 10 00:00:33,320 --> 00:00:36,240 Speaker 2: some of the details on Charles Schwab, a big financial 11 00:00:36,280 --> 00:00:39,120 Speaker 2: company reporting their results stock trading hire here today Neil 12 00:00:39,120 --> 00:00:42,559 Speaker 2: Sipstrain's he covers the financials for Bloomberg Intelligence. Neil talk 13 00:00:42,560 --> 00:00:44,800 Speaker 2: to us about the Charles Schwab. What's going on there? 14 00:00:44,960 --> 00:00:47,400 Speaker 3: Yeah, I think we're seeing a lot of franchise traction here. 15 00:00:47,400 --> 00:00:49,560 Speaker 3: I mean, you look at Schwab, right, we think about 16 00:00:50,400 --> 00:00:54,520 Speaker 3: massive retail broker forty six million touch points across the US. 17 00:00:55,440 --> 00:00:57,480 Speaker 3: So this is the mass affluent all the way up 18 00:00:57,520 --> 00:01:01,400 Speaker 3: to smaller buckets in higher networth jewels. And what we're 19 00:01:01,400 --> 00:01:04,080 Speaker 3: seeing is the fourth quarter was excellent, right in terms 20 00:01:04,120 --> 00:01:07,920 Speaker 3: of retail engagement markets were near all time highs. We're 21 00:01:07,920 --> 00:01:12,200 Speaker 3: still kind of floating around there despite some choppiness. Margin balances, 22 00:01:12,240 --> 00:01:16,600 Speaker 3: these are obviously very lucrative lending opportunities for a name 23 00:01:16,760 --> 00:01:21,600 Speaker 3: like Schwab, robin Hood, etc. You know, margin balances were 24 00:01:21,640 --> 00:01:25,119 Speaker 3: at a record So we're seeing that sort of exuberance 25 00:01:25,120 --> 00:01:27,040 Speaker 3: in the markets, and all of that is you know, 26 00:01:27,120 --> 00:01:29,880 Speaker 3: positive to the fundamentals that someone like Schwab where people 27 00:01:29,920 --> 00:01:34,560 Speaker 3: continually you know, it's a cyclical name, but you tend 28 00:01:34,640 --> 00:01:36,720 Speaker 3: to add more assets into your account when markets are 29 00:01:36,720 --> 00:01:38,760 Speaker 3: performing well, you tend to trade a little bit more. 30 00:01:38,840 --> 00:01:42,919 Speaker 3: Engagement sentiment is higher. All that sort of feeds feeds 31 00:01:42,920 --> 00:01:43,560 Speaker 3: the franchise. 32 00:01:43,880 --> 00:01:47,319 Speaker 4: Does that exuberance extend to speculative for verb, meaning is 33 00:01:47,560 --> 00:01:50,560 Speaker 4: Charlie Troub going to lean into prediction markets or crypto? 34 00:01:51,440 --> 00:01:54,559 Speaker 3: Yeah? So I guess two different answers there. Crypto yes. 35 00:01:55,360 --> 00:01:58,680 Speaker 3: I think the more favorable outlook at least for crypto 36 00:01:58,760 --> 00:02:02,800 Speaker 3: regulation and enforced has sort of allowed them to move 37 00:02:02,840 --> 00:02:06,200 Speaker 3: forward and rolling out spot crypto trading, which we expect 38 00:02:06,200 --> 00:02:09,200 Speaker 3: in the first half of twenty twenty six. They've talked 39 00:02:09,240 --> 00:02:11,079 Speaker 3: about how a lot of their customers are trading the 40 00:02:11,560 --> 00:02:16,359 Speaker 3: bitcoin ETFs and alike and sort of moving into the 41 00:02:16,400 --> 00:02:19,600 Speaker 3: spot trading that you've seen for a longer period of 42 00:02:19,600 --> 00:02:22,560 Speaker 3: time at crypto native firms, as well as names like Robinhood, 43 00:02:22,600 --> 00:02:26,240 Speaker 3: so expanding into that business that should you know, provide 44 00:02:26,600 --> 00:02:31,239 Speaker 3: yet another additive product, not necessarily becoming a crypto powerhouse 45 00:02:31,800 --> 00:02:33,359 Speaker 3: like some of the other names like a coin base 46 00:02:33,400 --> 00:02:35,720 Speaker 3: of Robin Hoood that we know of. Prediction markets, on 47 00:02:35,720 --> 00:02:38,639 Speaker 3: the other hand, they've been slower and more measured in 48 00:02:38,960 --> 00:02:42,320 Speaker 3: the plans there, staying away from the sports. They've talked 49 00:02:42,320 --> 00:02:44,840 Speaker 3: about if those financial type contracts that are tied to 50 00:02:44,880 --> 00:02:49,440 Speaker 3: economic outcomes or stock outcomes, those eventually could make their 51 00:02:49,440 --> 00:02:52,440 Speaker 3: way under the platform. No plans yet, but for now 52 00:02:52,760 --> 00:02:54,840 Speaker 3: sports gambling is not on the table. 53 00:02:55,639 --> 00:02:58,720 Speaker 2: Stay with us. More from Bloomberg Intelligence coming up after this. 54 00:03:02,639 --> 00:03:06,320 Speaker 1: You're listening to the Bloomberg Intelligence podcast. Catch us live 55 00:03:06,400 --> 00:03:09,480 Speaker 1: weekdays at ten am Eastern on Apple Coarclay, and Android 56 00:03:09,520 --> 00:03:12,800 Speaker 1: Auto with the Bloomberg Business app. Listen on demand wherever 57 00:03:12,880 --> 00:03:16,160 Speaker 1: you get your podcasts, or watch us live on YouTube. 58 00:03:17,040 --> 00:03:19,160 Speaker 2: We want to turn to David Gerry here from Bloomberg News. 59 00:03:19,200 --> 00:03:21,280 Speaker 2: He joins us here as in our studio. David that 60 00:03:21,360 --> 00:03:24,560 Speaker 2: was a long, rambling speech from the President in Davos, 61 00:03:24,600 --> 00:03:27,640 Speaker 2: had some tough words, as I guess should be expected 62 00:03:28,000 --> 00:03:31,800 Speaker 2: for some of those in attendance from the world leaders. 63 00:03:31,840 --> 00:03:35,000 Speaker 2: There any takeaways for you there? It was striking. 64 00:03:35,000 --> 00:03:36,880 Speaker 5: I was in this very same seat yesterday listening to 65 00:03:36,880 --> 00:03:38,120 Speaker 5: the President as he went to the White House to 66 00:03:38,120 --> 00:03:40,280 Speaker 5: that press briefing, and a lot of what we heard 67 00:03:40,760 --> 00:03:43,480 Speaker 5: that seemed scripted was what we heard the President say yesterday. 68 00:03:43,520 --> 00:03:45,600 Speaker 5: So we talked about the domestic economy, talked about the 69 00:03:45,680 --> 00:03:47,880 Speaker 5: last year, and all he sees is himself is achieving 70 00:03:47,920 --> 00:03:50,000 Speaker 5: over the last year, the first year of his second term. 71 00:03:50,760 --> 00:03:52,360 Speaker 5: But almost as an aside, he said to the audience, 72 00:03:52,360 --> 00:03:54,960 Speaker 5: you want me to talk about Greenland, and lo he did, 73 00:03:55,600 --> 00:03:57,400 Speaker 5: and as Scarlett pointed out, he referred to it as 74 00:03:57,440 --> 00:03:59,440 Speaker 5: a piece of ice, cold and poorly located that can 75 00:03:59,480 --> 00:04:02,120 Speaker 5: play a vital role in world peace and world protection. 76 00:04:02,240 --> 00:04:06,320 Speaker 5: And he, over the coorus of maybe fifteen or twenty minutes, 77 00:04:06,360 --> 00:04:09,200 Speaker 5: made the case for the US acquiring that territory. Didn't 78 00:04:09,280 --> 00:04:11,000 Speaker 5: say explicitly how we would go about doing that. As 79 00:04:11,040 --> 00:04:13,400 Speaker 5: Scarlette pointed out, said that the goal here for the 80 00:04:13,480 --> 00:04:16,040 Speaker 5: US is not to use force to do so, but 81 00:04:16,080 --> 00:04:18,520 Speaker 5: said that he needs it for strategic international security. That's 82 00:04:18,560 --> 00:04:22,360 Speaker 5: our territory, the President said, And he dovetailed that Paul 83 00:04:22,440 --> 00:04:26,640 Speaker 5: with commentary on NATO and criticism of NATO in a 84 00:04:26,680 --> 00:04:28,640 Speaker 5: way that I think would shock a lot of people 85 00:04:28,680 --> 00:04:33,200 Speaker 5: in the room, people from Europe especially, who likely blanched 86 00:04:33,200 --> 00:04:35,440 Speaker 5: when he said that if something were to happen, if 87 00:04:35,480 --> 00:04:37,040 Speaker 5: the US were to be attacked and the US were 88 00:04:37,040 --> 00:04:38,839 Speaker 5: to call NATO, he's not sure that those allies would 89 00:04:38,880 --> 00:04:41,359 Speaker 5: come to the defense of the US. And I just 90 00:04:41,440 --> 00:04:43,080 Speaker 5: have to point out here the one time that Article 91 00:04:43,080 --> 00:04:45,960 Speaker 5: five of the North Atlantic Treaty has been triggered invoked 92 00:04:46,040 --> 00:04:48,800 Speaker 5: was after September eleventh. That's when NATO got involved. So 93 00:04:50,520 --> 00:04:53,000 Speaker 5: we talk about his sandwiches often as sandwiches, you got 94 00:04:53,040 --> 00:04:54,400 Speaker 5: to focus on what's in the middle. I think that 95 00:04:54,440 --> 00:04:57,159 Speaker 5: was the case during that speech as well. Again, a 96 00:04:57,160 --> 00:05:00,000 Speaker 5: lot of boilerplate that we've heard before about his achievement, 97 00:05:00,000 --> 00:05:01,320 Speaker 5: it's in the state of the economy, but really it 98 00:05:01,360 --> 00:05:02,680 Speaker 5: was the middle. It was the substance that was the 99 00:05:02,720 --> 00:05:04,800 Speaker 5: most interested to people there in the room. And I'm 100 00:05:04,839 --> 00:05:06,840 Speaker 5: frankly not sure that what the President said there is 101 00:05:06,880 --> 00:05:08,720 Speaker 5: going to do anything to kind of play cat or 102 00:05:08,760 --> 00:05:11,480 Speaker 5: pacify or turn down the temperature in the room of 103 00:05:11,480 --> 00:05:13,920 Speaker 5: those European leaders who have been so gravely concerned by 104 00:05:13,920 --> 00:05:15,640 Speaker 5: what the President has said about Greenland. 105 00:05:16,000 --> 00:05:18,720 Speaker 4: But it didn't seem to alarm investors because we see 106 00:05:18,839 --> 00:05:22,200 Speaker 4: equities higher right now, the SMP five hundred of seven, 107 00:05:22,240 --> 00:05:25,120 Speaker 4: tens of one percent. You're also seeing yields lower too, 108 00:05:25,200 --> 00:05:28,960 Speaker 4: with the ten yure yield, you know, marginally lower, but notably. 109 00:05:29,040 --> 00:05:31,440 Speaker 4: It's a negative sign in front of the movement there. 110 00:05:31,520 --> 00:05:35,000 Speaker 4: So for investors, it wasn't alarming to the point where 111 00:05:35,000 --> 00:05:36,120 Speaker 4: anyone needs to do anything. 112 00:05:36,839 --> 00:05:37,400 Speaker 2: It wasn't. 113 00:05:37,480 --> 00:05:38,960 Speaker 5: And you know, this is a game that we play 114 00:05:39,000 --> 00:05:42,159 Speaker 5: over and over again as the President introduces something, expounds 115 00:05:42,200 --> 00:05:44,480 Speaker 5: upon it more, maybe walks things back, and investors are 116 00:05:44,480 --> 00:05:46,159 Speaker 5: trying to process all of this in real time. So 117 00:05:46,200 --> 00:05:48,560 Speaker 5: I think while this speech was important to hear from 118 00:05:48,600 --> 00:05:50,640 Speaker 5: the President directly on Greenland, more than we've heard from 119 00:05:50,640 --> 00:05:53,800 Speaker 5: his posts on social media, I think attention now turns 120 00:05:53,800 --> 00:05:56,120 Speaker 5: to what these European leaders saying. Next, we were talking 121 00:05:56,160 --> 00:06:01,000 Speaker 5: on surveillance about how there is no unanimity among European leaders. Yes, 122 00:06:01,040 --> 00:06:02,440 Speaker 5: I think there's an effort underway by a lot of 123 00:06:02,480 --> 00:06:04,120 Speaker 5: these leaders to kind of get everybody on board with 124 00:06:04,120 --> 00:06:07,279 Speaker 5: a coordinated response with the US is proposing here. That's 125 00:06:07,320 --> 00:06:09,360 Speaker 5: what I think we investors are going to be paying 126 00:06:09,360 --> 00:06:11,360 Speaker 5: attention to in the days to come with Now, that's. 127 00:06:11,200 --> 00:06:13,599 Speaker 4: A structural weakness with Europe, right, that they can't get 128 00:06:13,600 --> 00:06:15,760 Speaker 4: together and come up with a decision quickly. 129 00:06:16,240 --> 00:06:18,359 Speaker 5: It is a structural weakness and one I think that 130 00:06:18,400 --> 00:06:21,039 Speaker 5: these leaders acknowledge, and certainly President Trump acknowledged in that 131 00:06:21,040 --> 00:06:22,960 Speaker 5: speech as well in the run up to it. I 132 00:06:23,000 --> 00:06:25,400 Speaker 5: think that he sees Europe as being weak because they 133 00:06:25,400 --> 00:06:27,719 Speaker 5: can't come to a coordinated response on issues like this, 134 00:06:27,800 --> 00:06:29,880 Speaker 5: and he kind of extended that further in those remarks 135 00:06:29,920 --> 00:06:31,920 Speaker 5: to talk about a potential military response to some sort 136 00:06:31,960 --> 00:06:34,839 Speaker 5: of attack. So I think that he has and continues 137 00:06:34,839 --> 00:06:36,320 Speaker 5: to see Europe as being weak by the way that 138 00:06:36,360 --> 00:06:39,560 Speaker 5: it's structured here, and that sort of manifests in this 139 00:06:39,600 --> 00:06:43,440 Speaker 5: speech as well. So again I think that's the more 140 00:06:43,720 --> 00:06:45,400 Speaker 5: sale and important point for me, is sort of the 141 00:06:45,760 --> 00:06:47,760 Speaker 5: way that Europe talks about this and acts here in 142 00:06:47,760 --> 00:06:48,440 Speaker 5: the coming days. 143 00:06:49,120 --> 00:06:53,800 Speaker 2: Mark Carney from Canada some strong words today. How does 144 00:06:53,839 --> 00:06:56,080 Speaker 2: that relationship do you think work between Canada and the 145 00:06:56,080 --> 00:06:59,200 Speaker 2: European Union broadly defined, because obviously there are some close 146 00:06:59,240 --> 00:07:01,719 Speaker 2: ties every mister. He had some pretty sharp rhetoric. 147 00:07:02,080 --> 00:07:04,920 Speaker 5: Yeah, he delivered a very forceful speech in which he 148 00:07:04,920 --> 00:07:07,640 Speaker 5: said we're in the midst of a rupture, not a transition. 149 00:07:07,839 --> 00:07:10,520 Speaker 5: So he is not minimizing what's going on here. And 150 00:07:10,560 --> 00:07:12,200 Speaker 5: I think you've seen him go back and forth to 151 00:07:12,200 --> 00:07:14,200 Speaker 5: Europe a number of times since he started in the 152 00:07:14,280 --> 00:07:16,480 Speaker 5: job as Prime Minister. He clearly has good relationships with 153 00:07:16,520 --> 00:07:19,120 Speaker 5: many of these European leaders, both through his work in 154 00:07:19,160 --> 00:07:21,640 Speaker 5: this job and certainly the job that he had before 155 00:07:21,680 --> 00:07:23,720 Speaker 5: that when he was at the Bank of England. He 156 00:07:23,800 --> 00:07:25,960 Speaker 5: knows a lot of these principles and I think he's 157 00:07:26,000 --> 00:07:29,560 Speaker 5: worked hard to better fortify that relationship between Canada and 158 00:07:29,600 --> 00:07:31,800 Speaker 5: these European nations. And so the substance of that speech, yes, 159 00:07:31,800 --> 00:07:34,920 Speaker 5: it was this criticism of the liberal order. He basically 160 00:07:35,000 --> 00:07:38,360 Speaker 5: said that the many countries have been misled by alliging 161 00:07:38,360 --> 00:07:41,200 Speaker 5: themselves with the United States. But if you look at 162 00:07:41,240 --> 00:07:43,920 Speaker 5: how that has kind of turned into an economic policy platform, 163 00:07:44,360 --> 00:07:47,200 Speaker 5: he's very much making the case for mid sized countries. 164 00:07:47,240 --> 00:07:49,000 Speaker 5: I think this is fascinating and something to chart going 165 00:07:49,000 --> 00:07:51,160 Speaker 5: forward here. There's been so much focus on the premacy 166 00:07:51,200 --> 00:07:53,440 Speaker 5: of the United States, the role of the alliance that 167 00:07:53,440 --> 00:07:55,239 Speaker 5: you would have with the United States. He's saying, Look, 168 00:07:55,560 --> 00:07:58,720 Speaker 5: Canada is a good, middle sized country in its own right. 169 00:07:58,720 --> 00:08:01,360 Speaker 5: There is room here for more core nation collaboration among 170 00:08:01,400 --> 00:08:03,520 Speaker 5: countries like that. And so I think that's part and 171 00:08:03,560 --> 00:08:05,960 Speaker 5: parcel of what we've seen near him extending this arm 172 00:08:06,040 --> 00:08:07,960 Speaker 5: to Europe to try to develop that kind of relationship 173 00:08:08,000 --> 00:08:08,760 Speaker 5: going forward. 174 00:08:08,800 --> 00:08:10,680 Speaker 4: Right, And it's not just to Europe as well, because 175 00:08:11,040 --> 00:08:15,120 Speaker 4: Canada has now looked to China as a partner increasingly 176 00:08:15,720 --> 00:08:18,400 Speaker 4: in this new world order, right. I mean, he's embraced 177 00:08:18,480 --> 00:08:21,000 Speaker 4: China in a way that would probably have surprised Justin 178 00:08:21,040 --> 00:08:24,080 Speaker 4: Trudeau just a year or two ago. They've come to 179 00:08:24,200 --> 00:08:29,200 Speaker 4: an agreement here opening the door to electric vehicles from China, 180 00:08:29,200 --> 00:08:31,920 Speaker 4: auto investment from China. I mean, he's in a way 181 00:08:32,280 --> 00:08:34,200 Speaker 4: being forced to remake Canada's economy. 182 00:08:34,400 --> 00:08:35,079 Speaker 2: Absolutely. 183 00:08:35,200 --> 00:08:37,520 Speaker 5: And Davos was the last stop on a very significant 184 00:08:37,520 --> 00:08:40,520 Speaker 5: trip for the Prime minister. He's going back to Canada. 185 00:08:40,559 --> 00:08:42,600 Speaker 5: We'll have a cabinet meeting over the next couple of days. 186 00:08:42,600 --> 00:08:45,280 Speaker 5: But he said in that speech we actively take on 187 00:08:45,320 --> 00:08:47,160 Speaker 5: the world as it is not wait around for a 188 00:08:47,200 --> 00:08:49,560 Speaker 5: world we wish to be. So he went to Beijing. 189 00:08:49,559 --> 00:08:51,360 Speaker 5: There was a lot of groundwork laid for that visit. 190 00:08:51,400 --> 00:08:54,640 Speaker 5: There was a new trade agreements that were negotiated and 191 00:08:54,720 --> 00:08:56,920 Speaker 5: signed while he was there. Went to the Middle East, 192 00:08:57,280 --> 00:09:02,439 Speaker 5: similar sort of there for deals. So we've seen the 193 00:09:02,440 --> 00:09:05,360 Speaker 5: Prime Minister, as you say, Scarlett, taking on the world 194 00:09:05,440 --> 00:09:07,600 Speaker 5: in a very different way than his predecessor, Justin Trudeau. 195 00:09:07,640 --> 00:09:10,120 Speaker 5: But again I think there's a thick level of realism 196 00:09:10,200 --> 00:09:13,080 Speaker 5: there that the Prime Minister is very confident and content 197 00:09:13,200 --> 00:09:14,800 Speaker 5: to talk about wherever he goes. 198 00:09:15,679 --> 00:09:18,839 Speaker 2: Stay with us. More from Bloomberg Intelligence coming up after this. 199 00:09:22,720 --> 00:09:26,400 Speaker 1: You're listening to the Bloomberg Intelligence podcast. Catch us Live 200 00:09:26,480 --> 00:09:29,600 Speaker 1: weekdays at ten am Eastern on Apple, Cocklay and Android 201 00:09:29,600 --> 00:09:32,920 Speaker 1: Auto with the Bloomberg Business App. Listen on demand wherever 202 00:09:32,960 --> 00:09:36,240 Speaker 1: you get your podcasts, or watch us live on YouTube. 203 00:09:36,800 --> 00:09:39,360 Speaker 2: Well, the US Supreme Court well wig whether President Donald 204 00:09:39,360 --> 00:09:42,559 Speaker 2: Trump can fire Fed Governor Lisa Cook over mortgage fraud 205 00:09:42,600 --> 00:09:46,480 Speaker 2: allegations that she denies. The case concerns whether President Trump 206 00:09:46,559 --> 00:09:50,400 Speaker 2: can oust Cook temporarily while her challenge continues, but the 207 00:09:50,480 --> 00:09:53,079 Speaker 2: legal issues may have a broader effect on the fed's 208 00:09:53,080 --> 00:09:55,400 Speaker 2: independence gets more color on that. We welcome our next guest, 209 00:09:55,440 --> 00:09:59,400 Speaker 2: Nikki Lanier, CEO of Harper Slade and a former Saint 210 00:09:59,480 --> 00:10:03,439 Speaker 2: Louis Federal Senior Vice President, joining us from lovely lectioning 211 00:10:03,520 --> 00:10:06,480 Speaker 2: Kentucky via that zoom thing. Nikki, what do you make 212 00:10:06,520 --> 00:10:10,640 Speaker 2: of this case here with Lisa Cook here, I guess 213 00:10:10,679 --> 00:10:13,600 Speaker 2: on its face and then maybe even broader implications for 214 00:10:13,640 --> 00:10:14,439 Speaker 2: FED independence? 215 00:10:15,360 --> 00:10:18,880 Speaker 6: Oh my gosh, the significance of the implications on FED 216 00:10:19,400 --> 00:10:21,959 Speaker 6: independence should not be lost on anyone at this point, 217 00:10:21,960 --> 00:10:25,800 Speaker 6: anyone drawing breath on this planet. The Federal reserves independence, 218 00:10:26,520 --> 00:10:29,800 Speaker 6: as we all know, is the bedrock of American economic credibility, 219 00:10:29,880 --> 00:10:34,480 Speaker 6: and so efforts to politically target or remove a sitting governor, 220 00:10:35,120 --> 00:10:38,880 Speaker 6: especially especially as this case reaches the Supreme Court, this 221 00:10:39,160 --> 00:10:44,360 Speaker 6: risks politicizing monetary policy, destabilizing global trust in US markets. 222 00:10:45,400 --> 00:10:50,960 Speaker 6: There's just there's no upside to this, and the intentions 223 00:10:51,000 --> 00:10:57,760 Speaker 6: of this president and unseating and extraordinarily beautifully qualified Federal 224 00:10:57,800 --> 00:11:00,920 Speaker 6: Reserve governor is not only unprecedent but reckless. 225 00:11:02,360 --> 00:11:06,520 Speaker 4: So Nikki, the fact that three conservative justices have expressed 226 00:11:06,640 --> 00:11:10,000 Speaker 4: skepticism about the US government's argument so far, Amy Cony 227 00:11:10,040 --> 00:11:12,920 Speaker 4: Barrett has asked about the potential for risks to markets 228 00:11:13,240 --> 00:11:16,160 Speaker 4: if Lisa Cook is removed. Does that give you some 229 00:11:16,360 --> 00:11:19,120 Speaker 4: measure of confidence that she's getting a fair hearing? 230 00:11:20,080 --> 00:11:23,320 Speaker 6: I mean, hopefully so, hopefully so. I think, you know, 231 00:11:23,960 --> 00:11:27,040 Speaker 6: politics aside, which is hard to kind of set aside 232 00:11:27,040 --> 00:11:31,280 Speaker 6: in this context. There is I think an understanding among 233 00:11:31,480 --> 00:11:36,000 Speaker 6: our nation's leaders that the importance of the Federal Reserve 234 00:11:36,120 --> 00:11:42,840 Speaker 6: remaining independent and not corrupted by political whims or personal 235 00:11:43,760 --> 00:11:47,400 Speaker 6: gain is so core to the American economy, really the 236 00:11:47,440 --> 00:11:49,880 Speaker 6: global economy, and I think that that's not lost on 237 00:11:49,920 --> 00:11:52,120 Speaker 6: several of our Supreme Court justices. And I hope that 238 00:11:52,120 --> 00:11:55,720 Speaker 6: that will be the case as this case ensues, that 239 00:11:55,720 --> 00:11:58,520 Speaker 6: that will be the actual result of this that the 240 00:11:58,559 --> 00:12:00,880 Speaker 6: President will not have the any of authority to remove 241 00:12:00,920 --> 00:12:02,040 Speaker 6: this city governor. 242 00:12:02,600 --> 00:12:05,679 Speaker 2: So, I mean, this is a FED that's like pretty 243 00:12:05,760 --> 00:12:08,160 Speaker 2: much all FEDS in memory said that they are driven 244 00:12:08,200 --> 00:12:12,520 Speaker 2: by the data. Here is that potentially at risk. I mean, 245 00:12:12,720 --> 00:12:14,600 Speaker 2: could we get to a point where this FED does 246 00:12:14,640 --> 00:12:17,960 Speaker 2: become too politicized and maybe the data isn't what's driving 247 00:12:18,080 --> 00:12:19,040 Speaker 2: the decision. 248 00:12:18,640 --> 00:12:23,360 Speaker 6: Making, absolutely absolutely, and then it is game over. I mean, honestly, 249 00:12:23,400 --> 00:12:26,520 Speaker 6: game over that's core to the Fed's independence is really 250 00:12:26,559 --> 00:12:29,840 Speaker 6: relying on the data. These are stalwarts and studied and 251 00:12:30,880 --> 00:12:36,720 Speaker 6: highly pedigreed decision makers who are opining and deliberating painstakingly. 252 00:12:36,880 --> 00:12:40,200 Speaker 6: I've seen it in these FOMC meetings over whether to 253 00:12:40,280 --> 00:12:42,640 Speaker 6: raise interest rates and how to think about monetary policy 254 00:12:42,640 --> 00:12:45,000 Speaker 6: for the interests of the whole. And they are extraordinarily 255 00:12:45,120 --> 00:12:48,160 Speaker 6: data driven, not just empirical data. But my job when 256 00:12:48,160 --> 00:12:50,439 Speaker 6: I work for the FED was part of my role 257 00:12:50,520 --> 00:12:54,959 Speaker 6: was to solicit the anadotal data that rounded out the story, 258 00:12:55,360 --> 00:12:58,240 Speaker 6: giving rise from the from the empirical data. And so 259 00:12:58,360 --> 00:13:00,560 Speaker 6: they rely on that very heavily, and it is an 260 00:13:00,600 --> 00:13:06,200 Speaker 6: extraordinarily painstaking process that the lay citizens like you and 261 00:13:06,240 --> 00:13:09,480 Speaker 6: I and your listeners really have come to rely on. 262 00:13:10,679 --> 00:13:14,400 Speaker 4: So, Nikki, I'm sure after years of doing just that 263 00:13:14,480 --> 00:13:18,079 Speaker 4: kind of sifting through the data, considering all the anecdotal 264 00:13:18,160 --> 00:13:21,360 Speaker 4: out there and assessing the economy, you don't just stop 265 00:13:21,400 --> 00:13:23,640 Speaker 4: because you're no longer working at the FED. What is 266 00:13:23,679 --> 00:13:26,560 Speaker 4: your take of where the economy sits right now? What 267 00:13:26,679 --> 00:13:29,679 Speaker 4: is the biggest challenge here for FED officials as they 268 00:13:29,720 --> 00:13:32,120 Speaker 4: consider what to do On Jerry twenty. 269 00:13:31,920 --> 00:13:35,719 Speaker 6: Eighth, Listen The biggest challenge right now is the independence 270 00:13:35,920 --> 00:13:39,480 Speaker 6: and the Federal Reserve is under direct threat, direct threat 271 00:13:39,480 --> 00:13:42,040 Speaker 6: by the President of the United States. And so this 272 00:13:42,200 --> 00:13:46,600 Speaker 6: idea of a president being able, possibly being sanctioned in 273 00:13:46,640 --> 00:13:50,679 Speaker 6: a permissive way, to require the Federal Reserve to bend 274 00:13:50,840 --> 00:13:55,520 Speaker 6: monetary policy to political interests and personal grievances, it is 275 00:13:55,559 --> 00:14:03,200 Speaker 6: an extraordinarily dangerous precedent. If intimidation works, If intimidation is 276 00:14:03,240 --> 00:14:08,320 Speaker 6: able to prevail, then monetary policy leadership, the infrastructure giving 277 00:14:08,400 --> 00:14:11,240 Speaker 6: rise to the federal reserves dual mandate, how we've come 278 00:14:11,280 --> 00:14:14,200 Speaker 6: to know and understand and rely on how the FED 279 00:14:14,480 --> 00:14:19,120 Speaker 6: assigns rigor to the process of determining policy is entirely upended. 280 00:14:19,320 --> 00:14:21,600 Speaker 6: So I'm not even I can't even fathom what that 281 00:14:21,640 --> 00:14:24,160 Speaker 6: would look like in a world where a Federal Reserve 282 00:14:24,360 --> 00:14:28,680 Speaker 6: is entirely relenting to and acquiescing to the political whims 283 00:14:28,680 --> 00:14:30,680 Speaker 6: of any president, and especially this president. 284 00:14:31,000 --> 00:14:33,760 Speaker 2: And Nikki, we have a FED Chairman, Jerome Pale, actually 285 00:14:33,840 --> 00:14:37,560 Speaker 2: in attendance at the Supreme Court proceedings today. What does 286 00:14:37,560 --> 00:14:40,560 Speaker 2: that say? What kind of messages that send big dag 287 00:14:40,560 --> 00:14:40,960 Speaker 2: on deal? 288 00:14:41,160 --> 00:14:41,920 Speaker 6: That's a big deal? 289 00:14:42,120 --> 00:14:42,360 Speaker 4: Uh? 290 00:14:42,720 --> 00:14:48,280 Speaker 6: Chair Pal's decision to personally attend to personally attend these arguments. 291 00:14:48,400 --> 00:14:53,000 Speaker 6: It's it underscores the gravity of the moment. FED chairs 292 00:14:53,120 --> 00:14:56,440 Speaker 6: don't usually appear in court casually, and so his presence 293 00:14:56,520 --> 00:14:59,960 Speaker 6: signals the independence of the Central Bank itself. Not simple 294 00:15:00,160 --> 00:15:02,080 Speaker 6: the fate of one governor. This is far from just 295 00:15:02,120 --> 00:15:06,440 Speaker 6: a personnel kind of pedestrian personnel decision. This is a 296 00:15:06,800 --> 00:15:11,440 Speaker 6: significant decision now before the judiciary, really deciding whether the 297 00:15:11,480 --> 00:15:14,280 Speaker 6: FED will remain independent and be able to do its 298 00:15:14,400 --> 00:15:17,360 Speaker 6: job with the extraordinary rigor and discipline that it has been, 299 00:15:17,840 --> 00:15:20,560 Speaker 6: or if it must cave to the whims and the 300 00:15:20,600 --> 00:15:25,080 Speaker 6: wants for president and his political desires. 301 00:15:25,480 --> 00:15:27,360 Speaker 4: Niki, have you had a chance to speak with any 302 00:15:27,440 --> 00:15:31,440 Speaker 4: sitting FED governors or even Lisa Cook herself. I'm just 303 00:15:31,560 --> 00:15:35,080 Speaker 4: curious what you've heard on your end. 304 00:15:35,520 --> 00:15:37,720 Speaker 6: I've not had an opportunity to speak with either of them. 305 00:15:37,760 --> 00:15:39,920 Speaker 6: But what I will tell you, just from my perspective, 306 00:15:39,920 --> 00:15:44,840 Speaker 6: if I might be so bold, I worry about this 307 00:15:45,120 --> 00:15:49,440 Speaker 6: moment and the crisis that it presents, the compounding crisis, 308 00:15:49,440 --> 00:15:53,360 Speaker 6: the calcified crisis in many ways that it presents for 309 00:15:53,480 --> 00:15:56,520 Speaker 6: what's happening in the labor market and specifically the labor 310 00:15:56,520 --> 00:16:00,440 Speaker 6: market regarding black women. This is you know, this is 311 00:16:00,480 --> 00:16:02,680 Speaker 6: not sitting outside of a vacuum. This is in a 312 00:16:02,800 --> 00:16:06,200 Speaker 6: larger context. This president in his administration has very much 313 00:16:06,280 --> 00:16:09,680 Speaker 6: racialized his political policies, their core to who he is 314 00:16:09,720 --> 00:16:16,280 Speaker 6: and core to how he's planning to administer his priorities 315 00:16:16,400 --> 00:16:20,720 Speaker 6: and right in this in his administration. So what I 316 00:16:20,760 --> 00:16:22,960 Speaker 6: really worry about is with the signals in terms of 317 00:16:23,080 --> 00:16:27,360 Speaker 6: codifying continued attacks on professional black women. 318 00:16:28,080 --> 00:16:32,800 Speaker 1: This is the Bloomberg Intelligence Podcast, available on Apple, Spotify, 319 00:16:33,000 --> 00:16:36,480 Speaker 1: and anywhere else you get your podcasts. Listen live each 320 00:16:36,480 --> 00:16:40,200 Speaker 1: weekday ten am to noon Eastern on Bloomberg dot com, 321 00:16:40,360 --> 00:16:43,920 Speaker 1: the iHeartRadio app, tune In, and the Bloomberg Business app. 322 00:16:44,320 --> 00:16:47,240 Speaker 1: You can also watch us live every weekday on YouTube 323 00:16:47,640 --> 00:16:49,880 Speaker 1: and always on the Bloomberg terminal.