1
00:00:02,520 --> 00:00:10,119
Speaker 1: Bloomberg Audio Studios, Podcasts, radio News. You're listening to the

2
00:00:10,119 --> 00:00:13,880
Speaker 1: Bloomberg Balance of Power podcast ketch us live weekdays at

3
00:00:13,920 --> 00:00:17,119
Speaker 1: noon and five pm Eastern on Apple, Cocklay and Android

4
00:00:17,160 --> 00:00:20,520
Speaker 1: Auto with the Bloomberg Business App. Listen on demand wherever

5
00:00:20,600 --> 00:00:25,120
Speaker 1: you get your podcasts, or watch us live on YouTube.

6
00:00:25,440 --> 00:00:28,319
Speaker 2: Instant reaction to the post on True Social we just

7
00:00:28,360 --> 00:00:30,680
Speaker 2: got from President Trump. It's kind of a first it's sour,

8
00:00:30,760 --> 00:00:32,960
Speaker 2: then it's sweet scenario. I'm actually going to lead with

9
00:00:33,000 --> 00:00:34,680
Speaker 2: the sweet part at the back end of this post

10
00:00:34,720 --> 00:00:38,200
Speaker 2: show because that's what's driving markets. The presidents suggesting based

11
00:00:38,240 --> 00:00:40,479
Speaker 2: on the fact that more than seventy five countries have

12
00:00:40,560 --> 00:00:46,080
Speaker 2: called representatives of this administration to discuss and negotiate a

13
00:00:46,120 --> 00:00:49,879
Speaker 2: solution two matters of trade, he says countries that have

14
00:00:49,920 --> 00:00:52,040
Speaker 2: not retaliated in any way, shape or form against the

15
00:00:52,120 --> 00:00:55,279
Speaker 2: United States, he is authorizing a ninety day pause on

16
00:00:55,320 --> 00:00:58,440
Speaker 2: the tariffs and a substantially lowered reciprocal tariff during this period,

17
00:00:58,440 --> 00:01:02,280
Speaker 2: he says, of ten percent, also effective immediately after he

18
00:01:02,440 --> 00:01:05,319
Speaker 2: led this post by saying effective immediately, he was raising

19
00:01:05,319 --> 00:01:08,680
Speaker 2: the tariff on China, which has retaliated to one hundred

20
00:01:08,680 --> 00:01:11,160
Speaker 2: and twenty five percent, but clearly risk assets and others

21
00:01:11,360 --> 00:01:13,640
Speaker 2: are seizing more on the ninety day pause for everyone

22
00:01:13,680 --> 00:01:14,600
Speaker 2: else ex China.

23
00:01:14,760 --> 00:01:16,319
Speaker 3: I guess he read Bill Ackman's tweet.

24
00:01:16,600 --> 00:01:19,400
Speaker 2: Yeah, that is exactly what he suggested.

25
00:01:19,000 --> 00:01:21,440
Speaker 3: Based on the lack of respect. Kind of interesting. We've

26
00:01:21,440 --> 00:01:23,120
Speaker 3: got a red headline now in the terminal. This is

27
00:01:23,160 --> 00:01:25,280
Speaker 3: all happening before our eyes here on balance of power,

28
00:01:25,319 --> 00:01:27,919
Speaker 3: which is something that we're getting used to these days.

29
00:01:28,080 --> 00:01:32,640
Speaker 3: Ninety day tariff pause on non retaliating countries, remembering Scott

30
00:01:32,680 --> 00:01:37,840
Speaker 3: Bessett warned them not to retaliate, suggesting their behavior might

31
00:01:37,880 --> 00:01:40,440
Speaker 3: be rewarded. And here we are today, just hours after

32
00:01:40,800 --> 00:01:43,400
Speaker 3: retaliatory tariffs went into effect.

33
00:01:43,600 --> 00:01:46,080
Speaker 2: We're now up nearly seven percentage points on the mast

34
00:01:46,160 --> 00:01:47,840
Speaker 2: and one hundred as a result of this just goes

35
00:01:47,880 --> 00:01:51,200
Speaker 2: to show you how eagerly markets were waiting for anything

36
00:01:51,240 --> 00:01:53,800
Speaker 2: they perceive as positive news on tariff. Clearly this pause

37
00:01:53,840 --> 00:01:54,600
Speaker 2: being read that way.

38
00:01:54,480 --> 00:01:57,160
Speaker 3: And answers the question that this market could in fact

39
00:01:57,280 --> 00:02:01,400
Speaker 3: rally after being so technically broken. Clearly a market hungry

40
00:02:01,400 --> 00:02:04,680
Speaker 3: for news, and our political panel is at the ready here.

41
00:02:04,720 --> 00:02:08,280
Speaker 3: Bloomberg Politics contributors Rick Davis and Genie Shanzano are with us.

42
00:02:08,320 --> 00:02:11,280
Speaker 3: She is, of course democratic analyst, senior Democracy fellow with

43
00:02:11,320 --> 00:02:13,440
Speaker 3: the Center for the Study of the Presidency and Congress,

44
00:02:13,520 --> 00:02:18,280
Speaker 3: Rick partner at Stone Court Capital. President Trump said, Genie,

45
00:02:18,520 --> 00:02:20,520
Speaker 3: it's a good time to buy right now, Is he right?

46
00:02:22,200 --> 00:02:24,480
Speaker 4: Well, yeah, I think this is the first sign we've

47
00:02:24,560 --> 00:02:27,280
Speaker 4: gotten in the last week that the president may be

48
00:02:27,520 --> 00:02:30,840
Speaker 4: listening to the markets and that wiser and cooler heads

49
00:02:30,919 --> 00:02:34,800
Speaker 4: may be prevailing over his decisions. And so I agree

50
00:02:34,880 --> 00:02:38,880
Speaker 4: the ninety day pause very very welcome news for everyone.

51
00:02:39,240 --> 00:02:43,400
Speaker 4: But I do think this raises other questions. If this

52
00:02:43,720 --> 00:02:49,000
Speaker 4: was all about negotiating, then is he still interested in reshoring?

53
00:02:49,480 --> 00:02:52,560
Speaker 4: If this was about raising revenue, it can't be a

54
00:02:52,600 --> 00:02:56,480
Speaker 4: negotiating tool. And so what this was all about, this

55
00:02:56,720 --> 00:03:01,320
Speaker 4: uncertainty and all of this destruction is a big looming question,

56
00:03:01,800 --> 00:03:04,560
Speaker 4: and I think his supporters have the right to ask that,

57
00:03:04,639 --> 00:03:08,240
Speaker 4: particularly those folks in the UAW who, against a lot

58
00:03:08,280 --> 00:03:11,320
Speaker 4: of odds, have supported him throughout this. You know, last week,

59
00:03:11,360 --> 00:03:14,400
Speaker 4: as he's raised these tariffs around the world and talked

60
00:03:14,400 --> 00:03:17,560
Speaker 4: about re shoring and permanent tariffs and never giving up.

61
00:03:19,760 --> 00:03:21,960
Speaker 2: Well, certainly buyers are not giving up right now. They

62
00:03:21,960 --> 00:03:24,200
Speaker 2: are having a grand old time. It seems we are

63
00:03:24,240 --> 00:03:27,519
Speaker 2: approaching an eight percent now crossed it, eight percent gain

64
00:03:27,680 --> 00:03:30,280
Speaker 2: on the day for the Nasdaq one hundred. That would

65
00:03:30,280 --> 00:03:32,480
Speaker 2: be the biggest single day price move going back to

66
00:03:32,520 --> 00:03:35,560
Speaker 2: the depths of the COVID pandemic in March of twenty twenty.

67
00:03:35,560 --> 00:03:37,240
Speaker 2: The S and P five hundred right now up six

68
00:03:37,280 --> 00:03:40,080
Speaker 2: and a half percent. Take a single stock like Apple,

69
00:03:40,120 --> 00:03:42,000
Speaker 2: it's up the better part of twelve percentage points in

70
00:03:42,040 --> 00:03:44,720
Speaker 2: Nvidia around there as well, Nike. Some of these countries

71
00:03:44,760 --> 00:03:48,280
Speaker 2: we know were highly vulnerable in this tariff scenario are

72
00:03:48,400 --> 00:03:50,800
Speaker 2: rallying in a big way. Nikes up the better part

73
00:03:50,800 --> 00:03:52,960
Speaker 2: of eight percent, two and Rick. All of this coming

74
00:03:53,000 --> 00:03:56,480
Speaker 2: after just hours ago the President Trump told the public

75
00:03:56,840 --> 00:03:59,839
Speaker 2: it's a good time to buy. Did the President just

76
00:04:00,000 --> 00:04:03,360
Speaker 2: decly make a choice to help out financial markets here?

77
00:04:05,520 --> 00:04:08,080
Speaker 5: You know, it's hard to tell, you know, what's what's

78
00:04:08,240 --> 00:04:11,560
Speaker 5: I mean? Obviously, you know the trade news is positive,

79
00:04:11,640 --> 00:04:15,119
Speaker 5: But everybody's been watching all day for this treasury benchmark

80
00:04:15,760 --> 00:04:18,719
Speaker 5: sale and thirty nine billion dollars went on to market

81
00:04:18,800 --> 00:04:23,240
Speaker 5: and it was a very well received sale auction. So

82
00:04:24,000 --> 00:04:26,680
Speaker 5: it could be a combination of all these things. It

83
00:04:26,680 --> 00:04:29,440
Speaker 5: could be any one of these things driving the outcome.

84
00:04:29,520 --> 00:04:32,520
Speaker 5: What I find fascinating is the fact that Donald Trump's

85
00:04:32,560 --> 00:04:36,800
Speaker 5: kind of predicting, I mean, like predicting people, you know,

86
00:04:37,480 --> 00:04:41,279
Speaker 5: buying at the you know, dip, and then actually making

87
00:04:41,320 --> 00:04:44,800
Speaker 5: news within the trading day to affect that. I mean,

88
00:04:45,440 --> 00:04:50,200
Speaker 5: we're in uncharted territory here when it comes to market manipulation.

89
00:04:50,800 --> 00:04:55,479
Speaker 5: And I'm not suggesting there's anything of malfeasance involved in this,

90
00:04:55,720 --> 00:04:59,880
Speaker 5: but you certainly have markets reacting both on the upse

91
00:05:00,440 --> 00:05:03,320
Speaker 5: and on the downside of every word that is uttered

92
00:05:03,360 --> 00:05:08,240
Speaker 5: out of Donald Trump's mouth, specifically to tariff policy. And

93
00:05:08,680 --> 00:05:11,960
Speaker 5: this is big news to ratchet up your tariff war

94
00:05:12,080 --> 00:05:16,000
Speaker 5: with the biggest trading partner and other largest economy in

95
00:05:16,040 --> 00:05:18,560
Speaker 5: the world, China, and at the same time given relief

96
00:05:18,760 --> 00:05:22,560
Speaker 5: to those people who aren't arguing or aren't retaliating. And

97
00:05:23,080 --> 00:05:24,719
Speaker 5: we don't have a list of who they are, we

98
00:05:25,160 --> 00:05:29,880
Speaker 5: assume that it's within that core group of countries that

99
00:05:30,600 --> 00:05:34,840
Speaker 5: he's already raised tariffs with and will now delay their

100
00:05:34,880 --> 00:05:38,440
Speaker 5: implementation at least on the reciprocal side, for the next

101
00:05:38,520 --> 00:05:41,400
Speaker 5: ninety days ninety days. But to think that this is

102
00:05:41,440 --> 00:05:43,920
Speaker 5: going to add any stability to the market. I would

103
00:05:44,000 --> 00:05:45,400
Speaker 5: be shocked and surprised.

104
00:05:46,279 --> 00:05:48,440
Speaker 3: It's pretty Wild's here at the S and P five

105
00:05:48,520 --> 00:05:50,760
Speaker 3: hundred and now up seven point three percent. The Nasdaq

106
00:05:50,839 --> 00:05:54,120
Speaker 3: is up by almost nine percent. Gnia Tesla, by the way,

107
00:05:54,520 --> 00:05:58,320
Speaker 3: rising eleven percent. It's back above two hundred and forty

108
00:05:58,360 --> 00:06:03,440
Speaker 3: seven dollars here in heavy volume. Remembering that Howard Lutnik

109
00:06:03,520 --> 00:06:06,640
Speaker 3: suggested that people buy the shares, he said a lot

110
00:06:06,680 --> 00:06:08,640
Speaker 3: more than that. Actually at the time, this is when

111
00:06:08,680 --> 00:06:12,120
Speaker 3: the stock was at about two hundred and thirty five dollars.

112
00:06:12,160 --> 00:06:15,400
Speaker 3: He said to Fox two hundred and thirty five dollars

113
00:06:15,400 --> 00:06:18,800
Speaker 3: eighty six cents. Buy the stock. It'll never be this

114
00:06:19,040 --> 00:06:22,880
Speaker 3: cheap again. Donald Trump, this is a great time to buy.

115
00:06:23,680 --> 00:06:26,160
Speaker 3: Rick Davis just said it out loud. Do Democrats start

116
00:06:26,160 --> 00:06:30,280
Speaker 3: accusing this White House or calling for investigations into market manipulation?

117
00:06:31,520 --> 00:06:34,039
Speaker 4: Oh? I think they absolutely are going to do that.

118
00:06:34,279 --> 00:06:37,280
Speaker 4: I think that we will be hearing about that. You know,

119
00:06:37,360 --> 00:06:41,680
Speaker 4: the reality is is that we have a president who

120
00:06:41,760 --> 00:06:45,560
Speaker 4: has just with the sort of stroke of a pen.

121
00:06:45,640 --> 00:06:48,000
Speaker 4: But it's not even that it is just going on

122
00:06:48,080 --> 00:06:51,839
Speaker 4: truth social can move this much of the market, and

123
00:06:52,320 --> 00:06:54,719
Speaker 4: you bet that Democrats are going to be wanting to

124
00:06:54,720 --> 00:06:58,680
Speaker 4: ask questions. The problem is investigation is hard in Congress

125
00:06:58,760 --> 00:07:01,640
Speaker 4: when you are in the minority, so that'll be trouble

126
00:07:01,720 --> 00:07:04,919
Speaker 4: for them. But I do think that the president is

127
00:07:05,040 --> 00:07:07,960
Speaker 4: hearing from these folks who have been hurt badly. And

128
00:07:08,279 --> 00:07:11,360
Speaker 4: you know you've mentioned Dilon Musk, You've mentioned a few

129
00:07:11,400 --> 00:07:15,440
Speaker 4: of these people. Bill Ackman, Dave Portnoy is a big voice,

130
00:07:15,480 --> 00:07:17,960
Speaker 4: and he has been saying he would consider even voting

131
00:07:18,000 --> 00:07:21,640
Speaker 4: Democratic if this continued. Ken Langon, So a lot of

132
00:07:21,640 --> 00:07:24,120
Speaker 4: people very close to Donald Trump who've lost a lot

133
00:07:24,120 --> 00:07:26,560
Speaker 4: of money. So I think we are certainly going to

134
00:07:26,600 --> 00:07:28,640
Speaker 4: hear Democrats call for investigations.

135
00:07:30,360 --> 00:07:32,960
Speaker 2: All right. Geanie Schanzano and Rick Davis our political panel,

136
00:07:33,000 --> 00:07:35,200
Speaker 2: Bloomberg Politics and contributors, the both of them, thank you

137
00:07:35,240 --> 00:07:37,320
Speaker 2: so much for being with us as we contend with

138
00:07:37,400 --> 00:07:40,560
Speaker 2: this breaking news from President Trump. Yes, maybe bad news

139
00:07:40,560 --> 00:07:42,760
Speaker 2: for China's that tariff is immediately going up to one

140
00:07:42,840 --> 00:07:45,240
Speaker 2: hundred and twenty five percent, according to the President, but

141
00:07:45,280 --> 00:07:48,000
Speaker 2: for those who have chosen not to retaliate against the

142
00:07:48,120 --> 00:07:53,480
Speaker 2: US measures, a ninety day pause will also be immediately implemented,

143
00:07:53,520 --> 00:07:56,160
Speaker 2: and it has had an immediate impact on financial markets

144
00:07:56,160 --> 00:07:58,720
Speaker 2: off of the dramatic eize of the session. But we

145
00:07:58,760 --> 00:08:01,120
Speaker 2: are still talking about some very big moves here Joe

146
00:08:01,200 --> 00:08:03,320
Speaker 2: seven and a half percent rally on the Nasdaq, one

147
00:08:03,360 --> 00:08:05,840
Speaker 2: hundred more than six percent on the S and P,

148
00:08:06,040 --> 00:08:09,360
Speaker 2: and some of the individual movers incredibly remarkable as well.

149
00:08:09,400 --> 00:08:11,520
Speaker 2: Apple up double digits, Nvidia the.

150
00:08:11,480 --> 00:08:14,840
Speaker 3: Same remarkable strength in this rally here. And this is

151
00:08:14,840 --> 00:08:17,960
Speaker 3: only a couple of minutes old. You wonder how much

152
00:08:18,000 --> 00:08:20,280
Speaker 3: longer we can keep this kind of momentum in a

153
00:08:20,360 --> 00:08:24,120
Speaker 3: market that has been so badly beaten down. Remarkable in

154
00:08:24,200 --> 00:08:27,720
Speaker 3: real time as we watch this unfold right now live

155
00:08:27,760 --> 00:08:28,640
Speaker 3: on Bloomberg, and.

156
00:08:28,600 --> 00:08:31,360
Speaker 2: Our colleague Scarlet, who is watching it unfold with the

157
00:08:31,400 --> 00:08:33,680
Speaker 2: rest of us, she prepares to get us counted down

158
00:08:33,679 --> 00:08:36,280
Speaker 2: to the closing bell later. It's a very different story, Scarlet,

159
00:08:36,280 --> 00:08:38,120
Speaker 2: than what we were dealing with just a few minutes ago.

160
00:08:38,280 --> 00:08:41,080
Speaker 6: Yeah, we were wondering whether the stock market was going

161
00:08:41,080 --> 00:08:44,080
Speaker 6: to extend its declines, and it looked like we're bouncing

162
00:08:44,080 --> 00:08:46,440
Speaker 6: around all morning. But this was kind of the signal

163
00:08:46,480 --> 00:08:49,520
Speaker 6: that everyone was waiting for. They were waiting for President

164
00:08:49,520 --> 00:08:52,360
Speaker 6: Trump to back off of his tariffs. He did that

165
00:08:52,400 --> 00:08:54,640
Speaker 6: for the countries that are negotiating, and this is something

166
00:08:54,679 --> 00:08:58,280
Speaker 6: that the administration has been very fourth rate on positing

167
00:08:58,559 --> 00:09:00,439
Speaker 6: all the different countries that have been coming up and

168
00:09:00,520 --> 00:09:03,079
Speaker 6: making phone calls and trying to reach out to speak

169
00:09:03,120 --> 00:09:06,360
Speaker 6: with the administration about some kind of negotiations, even though

170
00:09:06,400 --> 00:09:10,599
Speaker 6: it's not clear what exactly would move the Trump administration

171
00:09:10,760 --> 00:09:14,360
Speaker 6: to remove or mitigate some of those tariffs. What's notable

172
00:09:14,440 --> 00:09:18,360
Speaker 6: here is President Trump's comments about encouraging people to buy

173
00:09:18,440 --> 00:09:20,520
Speaker 6: the stock market. I wonder to what extent he's trying

174
00:09:20,520 --> 00:09:23,160
Speaker 6: to call the market bottom in the similar way that

175
00:09:23,240 --> 00:09:26,200
Speaker 6: President Obama did back in March of two thousand and nine.

176
00:09:26,400 --> 00:09:30,280
Speaker 6: Obama spoke on March third, and just over a week later,

177
00:09:30,440 --> 00:09:33,640
Speaker 6: the market hit its low point and from that point

178
00:09:33,720 --> 00:09:34,680
Speaker 6: on moved higher.

179
00:09:36,040 --> 00:09:40,200
Speaker 3: We're talking about a social media post here, Scarlett. We

180
00:09:40,240 --> 00:09:42,920
Speaker 3: don't have an actual piece of paper from the White House.

181
00:09:42,920 --> 00:09:47,959
Speaker 3: We don't even know exactly what countries qualify as non retaliatory.

182
00:09:48,200 --> 00:09:48,880
Speaker 6: Yeah, good point.

183
00:09:48,920 --> 00:09:52,280
Speaker 3: We do have to acknowledge the fluidity here in this

184
00:09:52,440 --> 00:09:57,080
Speaker 3: market and the stakes after such severe losses. Why should

185
00:09:57,120 --> 00:10:01,480
Speaker 3: investors have confidence in anything to do with tariffs right now?

186
00:10:01,760 --> 00:10:03,760
Speaker 6: I don't know that it's confidence to do with tariffs.

187
00:10:03,800 --> 00:10:06,840
Speaker 6: But for now, this is a bit of relief.

188
00:10:07,080 --> 00:10:07,559
Speaker 5: This is a.

189
00:10:07,520 --> 00:10:10,800
Speaker 6: Respite from the constant selling the bad news on Wall Street.

190
00:10:10,840 --> 00:10:14,800
Speaker 6: The projections that the US economy would tip into recession

191
00:10:14,880 --> 00:10:17,920
Speaker 6: have been steadily growing. A lot of people, including Larry

192
00:10:17,920 --> 00:10:22,160
Speaker 6: Fink of Blackrock. We're saying that many company executives were

193
00:10:22,160 --> 00:10:24,960
Speaker 6: telling him that the economy was already in recession. So

194
00:10:25,120 --> 00:10:28,040
Speaker 6: it kind of became this default scenario that we were

195
00:10:28,040 --> 00:10:29,800
Speaker 6: in recession and it would be only a matter of

196
00:10:29,800 --> 00:10:33,040
Speaker 6: time before the data backed that up. So this is

197
00:10:33,200 --> 00:10:36,600
Speaker 6: a break in that bad news story. So far this week,

198
00:10:36,640 --> 00:10:39,240
Speaker 6: we've seen the bad news really turn to the bond market.

199
00:10:39,600 --> 00:10:41,520
Speaker 6: Last week was all about the stock market kind of

200
00:10:41,520 --> 00:10:44,360
Speaker 6: in collapse mode, and it's been a lot more fluid

201
00:10:44,440 --> 00:10:46,840
Speaker 6: volatile this week. But the bond market has really taken

202
00:10:46,840 --> 00:10:49,320
Speaker 6: it on the chin this week, and there's a lot

203
00:10:49,360 --> 00:10:51,880
Speaker 6: of question marks over whether this is fundamentally driven or

204
00:10:51,880 --> 00:10:52,679
Speaker 6: technically driven.

205
00:10:54,360 --> 00:10:55,800
Speaker 2: I just want to point out for those who have

206
00:10:55,840 --> 00:10:58,839
Speaker 2: been following the commentary of Bill Ackman in regard to

207
00:10:58,880 --> 00:11:01,400
Speaker 2: tariffs too, as Joe Us just moments ago did push

208
00:11:01,400 --> 00:11:03,320
Speaker 2: for the ninety day pause to begin with, which is

209
00:11:03,320 --> 00:11:06,080
Speaker 2: what Donald Trump seems to have decided here. He posts

210
00:11:06,360 --> 00:11:10,040
Speaker 2: simple message on x now just thank you, nothing else,

211
00:11:10,120 --> 00:11:12,360
Speaker 2: So I guess he likes what he's seeing here, just

212
00:11:12,400 --> 00:11:15,280
Speaker 2: as risk asset investors do. But Scarlett's remarkable that we

213
00:11:15,280 --> 00:11:17,680
Speaker 2: get this news today after we already have learned today

214
00:11:17,679 --> 00:11:22,280
Speaker 2: about instances of multiple companies making decisions or having to

215
00:11:22,320 --> 00:11:25,600
Speaker 2: issue guidance that is unclear or pull that guidance because

216
00:11:25,600 --> 00:11:28,520
Speaker 2: of these tariffs. Delta, of course not willing to stand

217
00:11:28,520 --> 00:11:31,360
Speaker 2: by a forecast. We had Bloomberg reporting of Amazon actually

218
00:11:31,400 --> 00:11:35,240
Speaker 2: pulling orders of inventories on goods coming from China. Already,

219
00:11:35,360 --> 00:11:37,920
Speaker 2: this is affecting corporate behavior, even if the President has

220
00:11:37,960 --> 00:11:40,320
Speaker 2: now decided that there will be a pause at least

221
00:11:40,320 --> 00:11:41,160
Speaker 2: in some instances.

222
00:11:41,320 --> 00:11:41,640
Speaker 5: Yeah.

223
00:11:41,679 --> 00:11:45,520
Speaker 6: Absolutely, It's difficult for any company to go out there

224
00:11:45,559 --> 00:11:48,320
Speaker 6: and say very much about how they anticipate the year

225
00:11:48,400 --> 00:11:50,760
Speaker 6: to shape up when they don't know what's going to happen.

226
00:11:50,800 --> 00:11:53,319
Speaker 6: At the end of the day, nobody knows anything, and

227
00:11:53,520 --> 00:11:57,560
Speaker 6: to give firm numbers is just inviting scrutiny and inviting

228
00:11:58,080 --> 00:12:01,360
Speaker 6: people to knock your stock down when it won't come

229
00:12:01,400 --> 00:12:03,680
Speaker 6: to fruition. And I think that's pretty much the case

230
00:12:03,920 --> 00:12:06,960
Speaker 6: we were speaking with a pharmaceutical analyst who was talking

231
00:12:07,000 --> 00:12:11,559
Speaker 6: about how this promise by President Trump to impose tariffs

232
00:12:11,559 --> 00:12:14,679
Speaker 6: on the pharmaceutical industry is of course meant to encourage

233
00:12:14,720 --> 00:12:17,160
Speaker 6: these companies to move their manufacturing back to the US,

234
00:12:17,240 --> 00:12:20,040
Speaker 6: But because their supply chain is so complex and it

235
00:12:20,040 --> 00:12:22,880
Speaker 6: would take years for them to do so, they're not

236
00:12:22,960 --> 00:12:25,040
Speaker 6: ready to commit to anything else. They already have a

237
00:12:25,080 --> 00:12:27,480
Speaker 6: lot of their manufacturing, their high value manufacturing, in the

238
00:12:27,520 --> 00:12:30,560
Speaker 6: United States, but they are able to bring in a

239
00:12:30,559 --> 00:12:33,800
Speaker 6: lot of their products from overseas, you know, into their

240
00:12:33,800 --> 00:12:36,720
Speaker 6: warehouses and work off of their inventory. They probably have

241
00:12:36,760 --> 00:12:39,160
Speaker 6: a two year waiting period where they don't need to

242
00:12:39,160 --> 00:12:41,480
Speaker 6: do anything and can see how this all shakes out.

243
00:12:42,480 --> 00:12:45,920
Speaker 3: Bloomberg Scarlett Foo in the throes of the rally right now,

244
00:12:46,000 --> 00:12:48,040
Speaker 3: the S and P five hundred up three hundred and

245
00:12:48,120 --> 00:12:51,120
Speaker 3: ninety points, almost eight percent, Kaylee. The Nasdaq is up

246
00:12:51,120 --> 00:12:54,400
Speaker 3: by more than nine percent. A powerful move here, one

247
00:12:54,920 --> 00:12:57,600
Speaker 3: four hundred and fifty five point rally. As the Commerce

248
00:12:57,640 --> 00:13:00,960
Speaker 3: Secretary takes to Twitter Scott Best and I, he writes,

249
00:13:01,080 --> 00:13:04,720
Speaker 3: retweeting or showing a screen grab of President Trump's post

250
00:13:04,760 --> 00:13:06,880
Speaker 3: on truth social sat with the President, he says, well,

251
00:13:06,880 --> 00:13:09,280
Speaker 3: he wrote one of the most extraordinary truth posts of

252
00:13:09,320 --> 00:13:12,440
Speaker 3: his presidency. The world is ready to work with President

253
00:13:12,520 --> 00:13:15,760
Speaker 3: Trump to fix global trade, he says, and China has

254
00:13:15,840 --> 00:13:17,559
Speaker 3: chosen the opposite direction.

255
00:13:21,160 --> 00:13:24,640
Speaker 1: You're listening to the Bloomberg Balance of Power podcast. Catch

256
00:13:24,679 --> 00:13:27,679
Speaker 1: us live weekdays at noon and five pm Eastern on

257
00:13:27,840 --> 00:13:31,560
Speaker 1: Almalcarclay and Android Auto with the Bloomberg Business App. Listen

258
00:13:31,600 --> 00:13:34,720
Speaker 1: on demand wherever you get your podcasts, or watch us

259
00:13:34,760 --> 00:13:36,120
Speaker 1: live on YouTube.

260
00:13:37,480 --> 00:13:41,040
Speaker 3: The Press Secretary and the Treasury Secretary in the driveway

261
00:13:41,040 --> 00:13:44,760
Speaker 3: outside the West Wing sparring with reporters there, answering questions

262
00:13:44,800 --> 00:13:47,800
Speaker 3: after Donald Trump made clear that the ninety day review

263
00:13:47,840 --> 00:13:52,400
Speaker 3: period would begin for countries not retaliating to reciprocal tariffs

264
00:13:52,480 --> 00:13:54,960
Speaker 3: placed by the United States. In fact took effect at

265
00:13:54,960 --> 00:13:57,840
Speaker 3: twelve one am. There's a big exception here, and that's

266
00:13:57,960 --> 00:14:01,960
Speaker 3: China now facing a one hundred twenty five percent tariff.

267
00:14:02,280 --> 00:14:05,320
Speaker 3: Markets taking off on news of this review. Scott Bessen

268
00:14:05,520 --> 00:14:08,240
Speaker 3: just now saying we have a ten percent temporary floor,

269
00:14:08,640 --> 00:14:11,840
Speaker 3: and something we've heard him say before, Kaylee, the initial

270
00:14:11,960 --> 00:14:15,640
Speaker 3: Trump tariffs are the maximum level. The idea would be

271
00:14:15,800 --> 00:14:18,240
Speaker 3: engaged with this White House, we start to pull them

272
00:14:18,280 --> 00:14:21,840
Speaker 3: back interesting to hear him suggest the president goaded China

273
00:14:21,960 --> 00:14:23,080
Speaker 3: into this position.

274
00:14:23,080 --> 00:14:26,480
Speaker 2: Suggesting this was his strategy all along, And interesting to

275
00:14:26,520 --> 00:14:29,440
Speaker 2: hear as well the Press secretary telling the media assembled

276
00:14:29,640 --> 00:14:32,640
Speaker 2: to speak with these two that they misunderstood or were

277
00:14:32,680 --> 00:14:36,640
Speaker 2: missing Trump's art of the deal. Despite characterizations initially of

278
00:14:36,680 --> 00:14:39,720
Speaker 2: these tariffs being non negotiable and not a negotiating tactic,

279
00:14:39,760 --> 00:14:41,200
Speaker 2: maybe it all was for the deal at the end.

280
00:14:41,280 --> 00:14:43,840
Speaker 3: You wonder if Peter Navarro read that book, because he's

281
00:14:43,880 --> 00:14:47,480
Speaker 3: been projecting six trillion dollars in revenue over the next

282
00:14:47,480 --> 00:14:50,480
Speaker 3: decade from these tariffs that are in some cases maybe

283
00:14:50,520 --> 00:14:51,520
Speaker 3: never going to take effect.

284
00:14:52,080 --> 00:14:55,040
Speaker 2: Well, certainly the market is hoping maybe that that's the case.

285
00:14:55,040 --> 00:14:57,760
Speaker 2: At the very least, they're satisfied. Investors seem to be

286
00:14:57,800 --> 00:15:00,000
Speaker 2: with this ninety day pause. Again, the Nasdaq one hundred

287
00:15:00,120 --> 00:15:02,120
Speaker 2: nearly nine percent higher on the day. It's a seven

288
00:15:02,160 --> 00:15:04,040
Speaker 2: percent gain as we speak for the S and P

289
00:15:04,120 --> 00:15:05,680
Speaker 2: five hundred, and it's on that note we turn to

290
00:15:05,760 --> 00:15:08,040
Speaker 2: our colleague Joe Wisenthal, who of course is the host

291
00:15:08,280 --> 00:15:11,200
Speaker 2: of the Odd Lots podcast. Joe, is this just proof

292
00:15:11,240 --> 00:15:14,280
Speaker 2: that investors were waiting with baited breath for the opportunity

293
00:15:14,320 --> 00:15:14,960
Speaker 2: to buy the dip.

294
00:15:15,560 --> 00:15:17,640
Speaker 7: I mean, what I'll say is, I think it's evidence

295
00:15:17,680 --> 00:15:20,680
Speaker 7: that it's a huge relief that there's at least some

296
00:15:21,000 --> 00:15:24,960
Speaker 7: impulse to take an off ramp here. And last night,

297
00:15:25,040 --> 00:15:27,440
Speaker 7: when we saw treasure yields blowing out, when we saw

298
00:15:27,480 --> 00:15:30,960
Speaker 7: the ten year hit four point five percent, these are

299
00:15:31,120 --> 00:15:37,040
Speaker 7: dynamics that happen when there is like extreme stress, illiquidity

300
00:15:37,240 --> 00:15:42,840
Speaker 7: run dynamics happening in financial markets that can't persist very long.

301
00:15:42,880 --> 00:15:45,160
Speaker 7: When you see moves like what we saw last night.

302
00:15:45,560 --> 00:15:48,520
Speaker 7: I know the Secretary of vest there said this was

303
00:15:48,600 --> 00:15:51,520
Speaker 7: not a response to what we were seeing in market volatility,

304
00:15:51,760 --> 00:15:53,560
Speaker 7: that it was all you know, art of the deal,

305
00:15:53,600 --> 00:15:57,800
Speaker 7: et cetera. Nonetheless, you know clearly the markets were under

306
00:15:57,800 --> 00:15:59,840
Speaker 7: extreme distress. And I'll just say a couple other things.

307
00:15:59,880 --> 00:16:01,600
Speaker 7: You know, the market is you know, I'm looking at

308
00:16:01,680 --> 00:16:04,360
Speaker 7: Nasdaq one hundred futures there's still down five and a

309
00:16:04,360 --> 00:16:08,080
Speaker 7: half percent. The China terrifts are still huge. That's going

310
00:16:08,120 --> 00:16:10,360
Speaker 7: to be you know, a huge effect on lots of

311
00:16:10,400 --> 00:16:14,240
Speaker 7: American companies. There's the ten percent sort of floor tariffs.

312
00:16:14,480 --> 00:16:16,960
Speaker 7: Those are still in place. So look, I think it's

313
00:16:16,960 --> 00:16:20,400
Speaker 7: a big relief that obviously some of this has been delayed,

314
00:16:20,880 --> 00:16:23,480
Speaker 7: but I think there's still quite a bit to work

315
00:16:23,560 --> 00:16:26,800
Speaker 7: through here at a very minimum before there's some sort

316
00:16:26,800 --> 00:16:29,560
Speaker 7: of like true all clear. Every major index is still

317
00:16:29,600 --> 00:16:31,720
Speaker 7: like deeply in the red on the year. S ANDP

318
00:16:31,880 --> 00:16:33,480
Speaker 7: is down nine point six percent on the year.

319
00:16:34,600 --> 00:16:37,600
Speaker 3: Yeah, wow, Joe, it's great to have you with us here.

320
00:16:37,720 --> 00:16:40,800
Speaker 3: As this evolves before our eyes. One of the reporters

321
00:16:41,160 --> 00:16:43,320
Speaker 3: in the driveway asked a really important question of the

322
00:16:43,320 --> 00:16:47,360
Speaker 3: Treasury Secretary. Why should investors have confidence that this isn't

323
00:16:47,360 --> 00:16:50,120
Speaker 3: going to change again in the next twelve hours. These

324
00:16:50,160 --> 00:16:52,680
Speaker 3: just took effect at twelve oh one am. Speak to

325
00:16:52,720 --> 00:16:56,400
Speaker 3: the the psychology at this moment on Wall Street.

326
00:16:56,680 --> 00:16:57,960
Speaker 7: I mean, I think there's two things.

327
00:16:58,000 --> 00:16:58,280
Speaker 1: It's like.

328
00:16:58,360 --> 00:17:00,880
Speaker 7: One is like, yes, we've now seen that these headlines

329
00:17:00,920 --> 00:17:04,200
Speaker 7: can change all the time. I guess like it seems

330
00:17:04,240 --> 00:17:07,040
Speaker 7: plausible that, Okay, for the next ninety days you get

331
00:17:07,119 --> 00:17:10,840
Speaker 7: some sort of respite on the non China companies. But

332
00:17:10,920 --> 00:17:13,280
Speaker 7: I think even outside of stock market, you have to

333
00:17:13,280 --> 00:17:17,920
Speaker 7: think about actual business investing, hiring, et cetera. And we've

334
00:17:17,960 --> 00:17:23,200
Speaker 7: seen the business side sentiment surveys absolutely horrendous. We haven't

335
00:17:23,200 --> 00:17:25,679
Speaker 7: gotten a lot of hard data that really speaks to

336
00:17:25,720 --> 00:17:28,320
Speaker 7: what was happening economically in the middle of Mark. You know,

337
00:17:28,440 --> 00:17:31,120
Speaker 7: earlier in the week we heard Larry Fink said every

338
00:17:31,160 --> 00:17:34,520
Speaker 7: CEO that he talks to thinks the recession has already begun.

339
00:17:35,320 --> 00:17:38,720
Speaker 7: Jamie Diamond talk about recession being the base case. So

340
00:17:38,920 --> 00:17:42,520
Speaker 7: even with the ninety day pause and the non China countries,

341
00:17:43,119 --> 00:17:46,840
Speaker 7: it's worthwhile to think about, like what the last several

342
00:17:46,960 --> 00:17:51,520
Speaker 7: days have done for the business community in terms of saying, like,

343
00:17:51,520 --> 00:17:53,359
Speaker 7: wait are you you don't know the rules now? We

344
00:17:53,359 --> 00:17:54,600
Speaker 7: don't know what the rules are going to be for

345
00:17:54,640 --> 00:17:57,239
Speaker 7: like three months probably, and so we continue to have

346
00:17:57,359 --> 00:18:00,600
Speaker 7: this environment where, if nothing else, the trading relationship is

347
00:18:00,680 --> 00:18:03,119
Speaker 7: highly uncertain, which at least of the short term, is

348
00:18:03,160 --> 00:18:07,120
Speaker 7: not conducive to investment. But they would probably argue, yeah,

349
00:18:07,200 --> 00:18:08,920
Speaker 7: it is short term pain for long term game.

350
00:18:10,560 --> 00:18:12,560
Speaker 2: Well, it's incredible that these headlines hit in the one

351
00:18:12,560 --> 00:18:15,120
Speaker 2: o'clock hour ahead of the FED Minutes, which are due

352
00:18:15,160 --> 00:18:16,960
Speaker 2: to come out just a few minutes from now. Joe,

353
00:18:17,040 --> 00:18:19,600
Speaker 2: I guess whatever news we might have seen in them

354
00:18:19,640 --> 00:18:22,719
Speaker 2: probably overshadowed by these developments. Keeping in mind it's backward

355
00:18:22,800 --> 00:18:24,840
Speaker 2: looking minutes and they didn't know what the tariff levels

356
00:18:24,840 --> 00:18:26,440
Speaker 2: were going to be in the first place, let alone

357
00:18:26,440 --> 00:18:28,480
Speaker 2: that they would be pulled back. But it speaks to

358
00:18:28,480 --> 00:18:30,920
Speaker 2: the kind of uncertainty we keep hearing Chairman Pal talk

359
00:18:30,960 --> 00:18:33,480
Speaker 2: about as to why the Fed isn't entice to move

360
00:18:33,520 --> 00:18:36,000
Speaker 2: in any direction because so much is so unclear.

361
00:18:36,359 --> 00:18:39,240
Speaker 7: There's so much that's so unclear, you know, short term

362
00:18:39,240 --> 00:18:42,520
Speaker 7: market based inflation measures going up, long term wants going down,

363
00:18:43,119 --> 00:18:48,080
Speaker 7: so much uncertainty, soft data going down, hard data still going.

364
00:18:47,960 --> 00:18:48,399
Speaker 1: Up, you know.

365
00:18:48,440 --> 00:18:52,040
Speaker 7: And the other thing is speaking of uncertainty. Look, you heard,

366
00:18:52,119 --> 00:18:55,000
Speaker 7: we all heard, you know, the White House's presentation there

367
00:18:55,040 --> 00:18:56,840
Speaker 7: about the art of the deal, and China has now

368
00:18:56,880 --> 00:19:00,200
Speaker 7: been go toed to being revealed as the bad actor, etc.

369
00:19:00,440 --> 00:19:03,600
Speaker 7: And Okay, that's you know, that's a fine story. However,

370
00:19:03,720 --> 00:19:06,440
Speaker 7: last week at the Rose Garden, those reciprocal tariffs were

371
00:19:06,480 --> 00:19:10,520
Speaker 7: very specifically presented in such a manner that every country

372
00:19:10,520 --> 00:19:13,879
Speaker 7: that runs a bilateral trade surplus with US, which is

373
00:19:13,920 --> 00:19:17,800
Speaker 7: almost every other every country was per se engaged in

374
00:19:18,200 --> 00:19:22,919
Speaker 7: bad acting. That this is that's the whole premise of reciprocity.

375
00:19:23,240 --> 00:19:25,840
Speaker 7: And so you know, it's clearly not presented that China

376
00:19:25,920 --> 00:19:29,359
Speaker 7: was anything particularly special last week. The story has evolved.

377
00:19:29,400 --> 00:19:32,959
Speaker 7: The story has evolved, whether it's negotiations first, non negotiations,

378
00:19:33,240 --> 00:19:36,439
Speaker 7: et cetera. So, you know, again, I'm not surprised that

379
00:19:36,480 --> 00:19:39,800
Speaker 7: there is this sort of massive, massive sigh of relief.

380
00:19:40,080 --> 00:19:41,840
Speaker 7: We actually knew that there would be a massive sigh

381
00:19:41,840 --> 00:19:43,960
Speaker 7: of relief on Monday when we got the fake headline

382
00:19:44,080 --> 00:19:46,679
Speaker 7: about a ninety day pause that so we knew the

383
00:19:46,680 --> 00:19:49,720
Speaker 7: market was looking for something like this. But I think

384
00:19:49,720 --> 00:19:52,040
Speaker 7: there's still a lot of question marks about the sort

385
00:19:52,080 --> 00:19:55,119
Speaker 7: of what any negotiations would like look like and what

386
00:19:55,200 --> 00:19:57,280
Speaker 7: kind of economic degradation we see.

387
00:19:57,400 --> 00:20:00,880
Speaker 3: In the meantime, I'd love to hear the Trump interview

388
00:20:00,880 --> 00:20:02,560
Speaker 3: on odd lots. I have to say, we've only got

389
00:20:02,560 --> 00:20:05,200
Speaker 3: a minute left. We want to clear out in time

390
00:20:05,240 --> 00:20:07,720
Speaker 3: for fed minutes, Joe. But we heard the President said

391
00:20:07,760 --> 00:20:11,000
Speaker 3: last night this is a great time to buy, so

392
00:20:11,200 --> 00:20:14,280
Speaker 3: that this morning, in fact, everything is going to work out. Well,

393
00:20:14,359 --> 00:20:16,639
Speaker 3: is there a world in which you're allowing him to

394
00:20:16,720 --> 00:20:17,760
Speaker 3: eventually be correct?

395
00:20:18,440 --> 00:20:21,480
Speaker 7: Yeah, of course no, I hope So, like you know,

396
00:20:21,720 --> 00:20:24,359
Speaker 7: I you know, there was a few things. It's like

397
00:20:24,400 --> 00:20:27,480
Speaker 7: one is obviously you hope to have like a prosperous

398
00:20:27,520 --> 00:20:33,280
Speaker 7: global economy, which would be fantastic. Even prior to the

399
00:20:33,320 --> 00:20:37,159
Speaker 7: Trump administration, there's been a lot of anxiety about the

400
00:20:37,280 --> 00:20:40,119
Speaker 7: nature of but the US and really everyone's reliance on

401
00:20:40,320 --> 00:20:45,640
Speaker 7: China for domestic manufactured goods. Obviously, the Biden tried administration

402
00:20:45,920 --> 00:20:48,960
Speaker 7: tried to affect change on that respect, at least with

403
00:20:49,040 --> 00:20:52,760
Speaker 7: respect to sort of like cutting edge tech like semiconductors,

404
00:20:52,800 --> 00:20:55,200
Speaker 7: et cetera. There is a lot that could be better

405
00:20:55,400 --> 00:20:57,560
Speaker 7: about the world. Again, you know, when you look at

406
00:20:57,560 --> 00:21:01,439
Speaker 7: how much the markets sell off, that's really indicative indicative

407
00:21:01,440 --> 00:21:03,800
Speaker 7: of like investors are much more pessimistic than they were

408
00:21:03,880 --> 00:21:05,640
Speaker 7: about this day of the world than they were at

409
00:21:05,640 --> 00:21:09,879
Speaker 7: the beginning of the year. But you know, look, like

410
00:21:09,880 --> 00:21:12,720
Speaker 7: I said, I understand and I think it makes total

411
00:21:12,840 --> 00:21:15,480
Speaker 7: sense why there's this massive cyber relief happening in market

412
00:21:15,600 --> 00:21:16,040
Speaker 7: right now.

413
00:21:16,880 --> 00:21:18,680
Speaker 3: What a great chance to spend some time with Joe

414
00:21:18,680 --> 00:21:20,880
Speaker 3: Wisenthal next odd loss out of the Riot. It's great

415
00:21:20,880 --> 00:21:23,040
Speaker 3: to see. Thank you at World headquarters in New York.

416
00:21:27,600 --> 00:21:30,800
Speaker 3: Thanks for listening to the Balance of Power podcast. Make

417
00:21:30,840 --> 00:21:33,800
Speaker 3: sure to subscribe if you haven't already, at Apple, Spotify,

418
00:21:33,880 --> 00:21:36,440
Speaker 3: or wherever you get your podcasts. And you can find

419
00:21:36,520 --> 00:21:39,760
Speaker 3: us live every weekday from Washington, DC at noontime Eastern

420
00:21:40,080 --> 00:21:41,480
Speaker 3: at Bloomberg dot com.