Speaker 1: Welcome to the Bloomberg Penl podcast on Paul Swing You.
Speaker 1: Along with my co host Lisa Brahmas, each day we
Speaker 1: bring you the most noteworthy and useful interviews for you
Speaker 1: and your money, whether at the grocery store or the
Speaker 1: trading floor. Find a Bloomberg Penil podcast on Apple podcast
Speaker 1: or wherever you listen to podcasts, as well as at
Speaker 1: Bloomberg dot com. Well Leland Miller, a chief executive officer
Speaker 1: of China beige Book International, has nailed at time and
Speaker 1: again when it comes to looking at preliminary data coming
Speaker 1: out of Chinese companies, nonofficial data and estimating the increase
Speaker 1: or decrease in activity ahead of the official pm MY
Speaker 1: data that we got out of China that was incredibly
Speaker 1: ugly record weakness that we saw in the manufacturing sector.
Speaker 1: Leland Miller was saying that that we were going to
Speaker 1: see a contraction in the Chinese economy in the first quarter.
Speaker 1: That seems almost to be an uncertainty. The question now
Speaker 1: is going forward, how quickly can China ramp back up
Speaker 1: production and get supply chains working again. Leland Miller joins
Speaker 1: us here at our Interactive Broker Studios. So do you
Speaker 1: have a set based on preliminary data luland of how
Speaker 1: much we're seeing manufacturing come back online from China. Yeah,
Speaker 1: we're we're seeing firms go back to work, we're seeing
Speaker 1: workers show up. So we're seeing a trend towards firms opening.
Speaker 1: But the question is how productive are they are they
Speaker 1: actually being? Um, you know, there's a there's a real
Speaker 1: question about this. You know, when we break down the
Speaker 1: data to how many firms are open, to how many
Speaker 1: are working in normal operations, the ratio is very low.
Speaker 1: It's better than it was two weeks ago. Uh, And
Speaker 1: we're and we're you know, we're tracking this data every
Speaker 1: single day as it comes in, but this is China's
Speaker 1: not back to work yet. What we do know is
Speaker 1: that Beijing has given us their bad data that will
Speaker 1: be the low no matter what happens. And asteroid could
Speaker 1: hit Beijing at this point, and they're going to report
Speaker 1: better data going forward. And so the question is how
Speaker 1: much of this going back to work will be a
Speaker 1: cover for rising p M s and A and a
Speaker 1: better GDP number and better industrial production number when the
Speaker 1: underlying reality doesn't doesn't reflect that. And I think we're
Speaker 1: just waiting to see that because China is going back
Speaker 1: to work, but we don't know whether they're going back
Speaker 1: to growth. So is this literally, as I think about
Speaker 1: China going back to work, is it literally moving millions
Speaker 1: of people who are on their lunar holiday in their
Speaker 1: villages back to the city's, back to the factories and
Speaker 1: getting them working again. Is that kind of what we're
Speaker 1: talking about. That's a big chunk of it. So what
Speaker 1: we're seeing right now in some cases are buses being
Speaker 1: filled with micro workers who are being driven with police
Speaker 1: escorts from certain cities back to where they're needed. Uh.
Speaker 1: Jent Paying wants growth back at all costs, and so
Speaker 1: they are they are going to restart factories come hell
Speaker 1: or high water. But the question is again is you know,
Speaker 1: is this are we back? You know? Is this? Is
Speaker 1: this going to stay this way? Are the firms gonna
Speaker 1: be able to operate this way? Do they have the
Speaker 1: inputs to be able to build going forward? And none
Speaker 1: of this is clear at all yet. There was also
Speaker 1: a story that caught my attention about the potential to
Speaker 1: fudge data by having factories actually run electricity without necessarily
Speaker 1: having the workers to do the work. Are you seeing anything?
Speaker 1: I mean does that seem like a dominant type of
Speaker 1: development or just sort of a one off example. It's
Speaker 1: very Chinese. Look, the the Beijing has been doing things
Speaker 1: like this for years. And the reality is, and we've
Speaker 1: been warning people for years on this, electricity production is
Speaker 1: not a gauge of the Chinese economy. There's a lot
Speaker 1: of reasons for this, but the major reason is is
Speaker 1: that as soon as you came out with the lead
Speaker 1: Cut Young index, uh, you know, a number of years ago,
Speaker 1: the Chinese understood people were using that as a barometer,
Speaker 1: and they started manipulating the data. So what we've been
Speaker 1: trying to explain is that if you're out there using
Speaker 1: the lead Cut Young Index thinking you've got a brometer
Speaker 1: on economy, you're just listening to the Chinese story like
Speaker 1: any other piece of data. But this is actually really
Speaker 1: important because a lot of people have turned to soft
Speaker 1: data satellite images electricity production as a way to engauge
Speaker 1: the activity levels in China because they don't trust the
Speaker 1: official data. You're saying that this is also potentially fudged
Speaker 1: or being manipulated. What do you look at them for
Speaker 1: a reliable gauge? Well, look, we when we started trying
Speaker 1: to figure out different ways of tracking the economy. We
Speaker 1: went through all the different you know, obviously official data
Speaker 1: is tainted, but then looking through all the sort of
Speaker 1: private data sources, and what we found is that if
Speaker 1: you don't collect the data yourself and it's being used
Speaker 1: on a broad enough scale, the Chinese figure this out
Speaker 1: and they start manipulating it. You know, this is not
Speaker 1: some sort of conspiracy theory. It's very smart on the
Speaker 1: on on Beijing's bath, they want to make sure they
Speaker 1: control the narrative. So all these things, whether it's rare
Speaker 1: rail cargo, whether it's electricity, whether it's whether it's other
Speaker 1: bits of data. Uh that you know, they want to
Speaker 1: control the narrative, which means they're going to control the data.
Speaker 1: And that's why we just got around to collecting it ourselves,
Speaker 1: because we figured out unless you take Beijing out as
Speaker 1: the intermediary, you cannot trust the data, particularly in a crisis.
Speaker 1: All right, so let's talk about China slowly getting back
Speaker 1: to work. Give us a sense of how you think
Speaker 1: this might ramp here on the mid first quarter into
Speaker 1: second quarter and maybe the ultimate impact on for China. Right, Well,
Speaker 1: so what the Chinese idea is to have everything bottom
Speaker 1: out in February and to have more workers come back
Speaker 1: in and be able to announce much better uh much
Speaker 1: matter data in March and April, and then have if
Speaker 1: not a v V recovery maybe but you know, just
Speaker 1: a nice steady recovery that shows the competence of the party.
Speaker 1: The problem is one, we don't know whether the outbreak
Speaker 1: has actually been contained, so there are medical issues that
Speaker 1: we can't we we can't understand yet. The second is
Speaker 1: this is now spreading around the world and that hits demand,
Speaker 1: So you have a lot you know, you have a
Speaker 1: hit to demand domestically as well as it hit to
Speaker 1: production domestically, and then you have a hit to global
Speaker 1: demand is hitting tourism, this is hitting all kinds of
Speaker 1: of of of companies that are normal buyers of Chinese goods,
Speaker 1: and so the idea that they're going to have a
Speaker 1: bounce back in demand, I know that's what the narrative is.
Speaker 1: I know that's what they're aiming for. This now depends
Speaker 1: as much on what's happening outside of China as what's
Speaker 1: happening inside China. How low could growth go in China? Well,
Speaker 1: what will they announce. I won't announce a number less
Speaker 1: than say, you know, if we had a full on
Speaker 1: global outbreak, they'll still announce four percent plus GDP. What
Speaker 1: could it go? Look, I think that you could have
Speaker 1: Q one contraction. You could have Q one barely positive growth,
Speaker 1: and then you know you're back to your barely positive growth,
Speaker 1: and then your normal numbers um are are probably around
Speaker 1: three at a normal times. I mean, you could have
Speaker 1: one or two percent growth for the year if things
Speaker 1: were really bad. The Chinese would never announce that. But
Speaker 1: the reality is if things got much worse, you could
Speaker 1: see you could see growth under two percent. Certainly, How
Speaker 1: much of a problem, if at all, is this crisis
Speaker 1: for presidency? He's he's having a rough year or two. Yeah,
Speaker 1: Like Hong Kong and trade war and and and coronavirus. Uh,
Speaker 1: I think this is more dangerous than all of them,
Speaker 1: because because this goes to vulnerabilities of the party. It
Speaker 1: is not a mystery outside of China, but also inside
Speaker 1: of China that the reason that spread like it did
Speaker 1: is because officials lied in, covered it up, and and
Speaker 1: did a bunch of things you're never supposed to do
Speaker 1: when you've got an illness starting to spread. And this
Speaker 1: is not a mystery. I mean, you see it on
Speaker 1: we chat, you see it in domestic conversations. So the
Speaker 1: question is, how can they throw enough junior people under
Speaker 1: the bus, redeem the senior officials in terms of the
Speaker 1: wonderful response, and and sort of redeem the party's role
Speaker 1: in this. And one of the things you're seeing and
Speaker 1: you're going to see going forward is China is already
Speaker 1: starting to sell itself as the global authority on pandemic control.
Speaker 1: You know, will help you out here. We don't need
Speaker 1: any favorites United States, Iran, you want our help, it'llly
Speaker 1: you want our help, We're here, we show you how
Speaker 1: to do it right. It's a it's a clever narrative.
Speaker 1: It's ridiculous, but it's a clever narrative narrative. Leland Miller,
Speaker 1: as always, we appreciate your commentary. When it comes to
Speaker 1: all things China, we learned so much. Leland Miller is
Speaker 1: the chief executive officer of China based Book International. My
Speaker 1: go to person for things on China, which is, uh,
Speaker 1: you know, you have to really dig under the hood.
Speaker 1: There a lot of questions surrounding the markets right now.
Speaker 1: A key one is how long will the effect of
Speaker 1: the shutdown that we saw in China effect manufacturers in
Speaker 1: the United States will affect supply chains. There's no one
Speaker 1: better to talk about that than Brooks Sutherland, Bloomberg opinion
Speaker 1: columnist cover enjoining us here in our interactive Broker Studios.
Speaker 1: I want to start with the data that we got
Speaker 1: out today showing that manufacturing declined more than people expect
Speaker 1: to the United States in the month of February. I'm
Speaker 1: trying to understand as people game plan this out, do
Speaker 1: we have a sense of how long it will take
Speaker 1: for supply chains to get ramped up manufacturing to get
Speaker 1: ramped up once we have a sense of stability here.
Speaker 1: I do think with that I s M number, the
Speaker 1: headline is somewhat of a misnumber there, because if you
Speaker 1: look at what's bumping that number up, part of it
Speaker 1: is a lengthening out of delivery times, and typically that's
Speaker 1: supposed to be a good thing. It means demand is
Speaker 1: so strong that suppliers are struggling to meet that. In
Speaker 1: this case, it is likely an issue with people just
Speaker 1: not having the parts that they need because they're not
Speaker 1: able to get them from various different parts of the world.
Speaker 1: So to me, this says that the worst is yet
Speaker 1: to come for manufacturers, that you'll likely start to see
Speaker 1: some of the aftershocks from the supply dick chain disruption
Speaker 1: later on in the second quarter. So correct me if
Speaker 1: I'm wrong, Brooke. But is I think back to the
Speaker 1: list just a few weeks ago, when we were in
Speaker 1: the thick of earnings, you know, other than Apple and
Speaker 1: maybe a couple of the companies that were calling out
Speaker 1: the coronavirus as a reason to change their auto we
Speaker 1: didn't or did you, Did we hear much of anything
Speaker 1: from your industrial companies that you come No, not really,
Speaker 1: which is interesting because their earning season came a little
Speaker 1: bit earlier, and so at that point in time, most
Speaker 1: of the outlooks didn't really include any impact from the coronavirus. Now,
Speaker 1: the exception was Emerson Electric, which did come out at
Speaker 1: the end of last week and said they're increasing their
Speaker 1: expectation of the revenue hit from coronavirus to as much
Speaker 1: as a hundred and fifty million. It had been, you know,
Speaker 1: significantly lower just a few days before when they had
Speaker 1: held their investor day conference. So this sort of shows
Speaker 1: you just how fast moving this is UM Now. I
Speaker 1: do think you'll probably start to hear some guidance updates
Speaker 1: from these companies in the coming weeks. Uh. You know,
Speaker 1: g E is set to report its outlook on Wednesday,
Speaker 1: and so certainly we'll be keeping an eye on that
Speaker 1: for any guidance there, particularly around the coronavirus. But you know,
Speaker 1: I think the key issue for the manufacturing side is
Speaker 1: this supply chain disruption. But I do think you can
Speaker 1: look at some of these other companies a sort of
Speaker 1: a tell as to what we might see. I mean,
Speaker 1: if you think about a company like three M. On
Speaker 1: the one hand, they make face masks, which they're seeing
Speaker 1: a huge spike in demand. On the other hand, they
Speaker 1: make components for the electronics industry, and we did have
Speaker 1: Microsoft come out and warn about supply chain disruptions for
Speaker 1: its Windows PC unit. UM. Honeywell is another company that
Speaker 1: makes personal protective Year, but it also supplies components to
Speaker 1: the aerospace industry, and that is a much bigger, much
Speaker 1: more profitable business for that company. And I do think
Speaker 1: there's a risk of pretty significant downturn in aerospace when
Speaker 1: you talk about supply chain. So just think about how
Speaker 1: China is trying to get everybody back to factories and
Speaker 1: demonstrate that they are ramping up production. How do we
Speaker 1: have any precedent historically of how long it takes to
Speaker 1: get things back up and running and supply chains working
Speaker 1: as they had been. I don't know that we do,
Speaker 1: because I think what we've seen is that the response
Speaker 1: here has been so much more dramatic than what we
Speaker 1: saw with Stars in two thousand and three. And part
Speaker 1: of the reason for that is that China didn't account
Speaker 1: for as much as the of the world's supply chain
Speaker 1: at that point in time. But I think about Cafe Pacific,
Speaker 1: so they've cut about seventy of their capacity. And I
Speaker 1: saw one analyst report this morning saying during Stars that
Speaker 1: was So that's a really significant shift as you think
Speaker 1: about sort of the magnitudes of the response here and
Speaker 1: how we come back from this. But it's not just
Speaker 1: China anymore. Now we're dealing with Europe. Now, we're possibly
Speaker 1: dealing with the U S and maybe even travel restrictions domestically.
Speaker 1: I mean, we just don't know. And as if you
Speaker 1: start thinking about how you get parts from point A
Speaker 1: to point B, there's a lot of obstacles and a
Speaker 1: lot of unknowns, and so I think this is going
Speaker 1: to take a while for companies to bounce back from
Speaker 1: So Brooke. While we have you here, um Boeing. I
Speaker 1: saw a story that they're out there hiring a lot
Speaker 1: of people for the seven thirty seven Max. Does that
Speaker 1: suggect that that maybe they're close to getting this thing
Speaker 1: back in the air, you know, I think they want
Speaker 1: to be prepared because I think to shut down a
Speaker 1: manufacturing line for an aircraft is a really significant step
Speaker 1: for them to do that. I mean, they put that
Speaker 1: off as long as they possibly could, and that a
Speaker 1: big reason for that was a concern about having the
Speaker 1: labor there to be able to manufacture the planes once
Speaker 1: they do restart that. And there's also a lot of
Speaker 1: steps involved here with once the Max is on grounded,
Speaker 1: you have to get all of those planes ready to
Speaker 1: fly again. We've already seen you know, potential issues with
Speaker 1: that or bowing and said they've found you know, debris
Speaker 1: and some of the fuel tanks, whether that be like
Speaker 1: rags or you know, sort of leftover tools, and so
Speaker 1: they have to make sure that all of that gets fixed.
Speaker 1: And you have to bring these planes out of hibernation.
Speaker 1: I mean that takes time, that takes people, that takes effort.
Speaker 1: So look, I mean I think Boeing is progressing towards
Speaker 1: getting this plane ready to fly, but there are niggling
Speaker 1: issues that keep coming up and you know that may
Speaker 1: take a little bit of time to work through. There
Speaker 1: was a important the Seattle time not too long ago
Speaker 1: about the risk of this timeline potentially slipping a little bit.
Speaker 1: Now we're not talking about major shifts like we saw
Speaker 1: the course of last year, but there is potentially a
Speaker 1: risk there. What is the latest date? Do we have
Speaker 1: a date for? Boeing is stuck with mid But what
Speaker 1: means maybe there's some wiggle room there in terms of
Speaker 1: your definition. So all right, thank you very much brook Sotheran,
Speaker 1: and thanks so much for joining us. She covers all
Speaker 1: things industrials for Bloomberg Opinion. You can read her work
Speaker 1: excellent work on Bloomberg dot Com, Slash Opinion or if
Speaker 1: you're on a terminal O P I N go for books,
Speaker 1: work and all the other work from a Bloomberg Opinion.
Speaker 1: She joins us here in our Bloomberg Interactive Broker Studio. Well,
Speaker 1: despite the risk on field to the equity markets. Treasury
Speaker 1: yields continue to grind lower. We got the two year
Speaker 1: down about eleven basis points to zero point eight four percent,
Speaker 1: just extraordinary levels on treasuries. To get a sense of
Speaker 1: where yields could go. We welcome r J. Gallo. He's
Speaker 1: a senior portfolio manager, head of the Missable Bond Investment
Speaker 1: Group ahead of the Duration Committee for Federator Hermes. They
Speaker 1: have about eleven point seven billion under management. They're based
Speaker 1: in Pittsburgh. Of course, r J, thanks so much for
Speaker 1: joining us once again. All right, so we the coronavirus
Speaker 1: is there, it's spreading. Markets are trying to discount the impact.
Speaker 1: I guess one of the next issues for the market
Speaker 1: to really get a handle on is when will the
Speaker 1: FED cut and how much will they cut? What are
Speaker 1: your thoughts, well, I think it's pretty clear that this
Speaker 1: central bank, under the leadership of Powell as well as
Speaker 1: his most recent predecessors, have been eager to be proactive
Speaker 1: in the when faced with crisis or challenge, Yelling put
Speaker 1: off a plan tightening because markets got really volved all
Speaker 1: the way back. I think it's BERNANKI certainly got very aggressive.
Speaker 1: He's the one who sort of pioneered que all um
Speaker 1: Inen tightened maybe more than the markets would have liked,
Speaker 1: maybe more than was perhaps needed at the time, and
Speaker 1: quickly reversed course. So I don't think they are inertial.
Speaker 1: And I think the statement that came out last week
Speaker 1: from Powell indicates that the FED will move. Um. I
Speaker 1: don't know if in a textbook sense everybody agrees they
Speaker 1: should move, but I don't think it hurts anything. Uh.
Speaker 1: They can't cure the virus, they can't produce a vaccine,
Speaker 1: but they can help cushion the blow economically by lowering
Speaker 1: short term rates in such a way as to help
Speaker 1: bolster somewhat interest rate sensitive sectors that otherwise wouldn't get
Speaker 1: the boost from lower rates. So I think they are
Speaker 1: going to ease the three eases almost four eases that
Speaker 1: are on the work now seems extreme to me, but
Speaker 1: I know some highly respected research firms and research areas
Speaker 1: in the marketplace names everybody knows, UH suggests they're going
Speaker 1: to cut hunter basis points. So there's you know, there's
Speaker 1: your basis point eases. UM. I wouldn't be surprised if
Speaker 1: it'll be less than that. So yeah, Deutsche Bank and
Speaker 1: Coleman Sacks primarily among them, coming out with analysts saying
Speaker 1: they expect for rate cuts or a hundred basis points
Speaker 1: of cutting. I will just note that as you see
Speaker 1: stocks rally, the number of expected rate cuts is coming
Speaker 1: down precipitously. UH four year end now at just about
Speaker 1: a little over three full rate cuts by the end
Speaker 1: of January next year, so coming down. And I want
Speaker 1: to talk about that. How much do you think this
Speaker 1: erodes FED credibility if basically stock sell off and everyone
Speaker 1: looks to them to just cut rates to prop up valuations.
Speaker 1: I mean, is that the single data point that the
Speaker 1: FED is looking at this point? I actually don't think
Speaker 1: it is. I think that the FED cares very much
Speaker 1: about financial conditions. You all provide the Financial Conditions Index. Uh,
Speaker 1: it's on everybody's terminals. Have people have a terminal in
Speaker 1: front of them. UM, it's now down uh negative one
Speaker 1: standard deviation. UH. The FED wants markets to work. They
Speaker 1: want capital to be provided at reasonable prices. UH. They
Speaker 1: don't want gapping or volatile markets UH to to present
Speaker 1: a headwind to economic expansion. And the Financial Conditions Index
Speaker 1: sort of looks at volatility and valuation and tries to
Speaker 1: um you know, quantify if you will, that tricky measure
Speaker 1: of financial conditions, and they've clearly contracted with all that's
Speaker 1: gone on so rapidly over the last couple of weeks. UM.
Speaker 1: It's not just the stock market, the high yield corporate
Speaker 1: markets UH certainly slowed down, and I think the deals
Speaker 1: got pulled last week. There's no planned issuance at this point.
Speaker 1: I don't think that's a challenge to the Federal reserves
Speaker 1: overall framework that they want functioning of financial markets. So
Speaker 1: the easy isn't just to target a stock price or
Speaker 1: avoid a loss. I think it's to make sure that
Speaker 1: the financial UH flows in the economy don't grind to
Speaker 1: a halt. Twelve years ago when the financial crisis was
Speaker 1: starting up, it's when those financial flows ground to a halt,
Speaker 1: When when the provision of liquidity, when the transactions and
Speaker 1: repo markets, when the issuance of bonds ground to a halt,
Speaker 1: there was a clear sign of deeply challenging problems that
Speaker 1: the Fed needed to act to. I don't think we're
Speaker 1: there right now. I think that we have a more
Speaker 1: robust financial UM system right now, much better capitalized banks,
Speaker 1: sharp moves in markets are challenging for many, but financial
Speaker 1: prices changing does not beget a financial crisis. Um. The
Speaker 1: feds willingness to ease, on the other hand, is more
Speaker 1: looking at how the financial markets are sending a signal
Speaker 1: how the real economy will react in a public health
Speaker 1: crisis of a magnitude we have not seen if this
Speaker 1: gets as bad as people think it might. A highly
Speaker 1: transmissible virus that has a mortality rate that's somewhere around
Speaker 1: five to ten times the influenza which we did with
Speaker 1: every year. Um, there are stark steps that are being taken.
Speaker 1: Look what China did. They shut down cities worth fifty
Speaker 1: million people. That real economic consequences are very profound. So
Speaker 1: the Fed's easing isn't just to sort of blow the
Speaker 1: stock market, uh back up. It's it's to try to
Speaker 1: cushion the blow from an economic standpoint of all of
Speaker 1: the measures that may emerge in the United States as
Speaker 1: testing takes place. We're going to see many more cases
Speaker 1: in this country, and you're gonna see school district shutting down,
Speaker 1: you'll see less travel, you'll see events shutdown. That's what
Speaker 1: the FEDS reacted to. R. J. Gallow thank you so
Speaker 1: much for being with us. R J. Gallo, senior portfolio
Speaker 1: manager and a head of the Unicipal Bond Investment Group
Speaker 1: as well as the Duration Committee it federated. Hermes Let's
Speaker 1: shaft gears a little bit talk politics. Former Vice President
Speaker 1: Joe Biden had a landslide win in South Carolina over
Speaker 1: the weekend, and of course tomorrow is Super Tuesday. To
Speaker 1: put it all in a framework, we welcome Wendy Schiller.
Speaker 1: She's a professor of political science and public policy at
Speaker 1: Brown University in Providence, Rhode Island. Wendy, thanks so much
Speaker 1: for joining us. Let's start with Saturday. What really changed
Speaker 1: in the Democratic Party on Saturday? If anything? Well, I
Speaker 1: think two things came out of South Carolina. One is
Speaker 1: the you know, absolute importance of African American voters to
Speaker 1: the Democratic Party's fate in November, but also to each
Speaker 1: individual candidate running. I think that was really evident. And
Speaker 1: the resurgence of Joe Biden. I mean, we saw him
Speaker 1: a little bit better in the in the most recent debate,
Speaker 1: and he won resounding. It didn't quite pass fifty. I
Speaker 1: think that would have been really, you know, the striking victory,
Speaker 1: but he you know, really trounced Bernie Sanders in that respect.
Speaker 1: So the question is does that pattern hold going into
Speaker 1: tomorrow's primaries well, And there also is the development of
Speaker 1: Pete Budge dropping out mayor Pete dropping out of the
Speaker 1: race and throwing his support behind Joe Biden, And I'm
Speaker 1: wondering how much momentum you think that does give Biden
Speaker 1: against the Bernie Sanders ticket. I'm not persuaded that this
Speaker 1: is an automatic gift to Biden visa vis Sanders, because
Speaker 1: Sanders did well in Nevada particularly it's a caucus state, granted,
Speaker 1: not primary, but there are a lot of Latino voters
Speaker 1: in the DEM Party in Nevada, and Sanders did well
Speaker 1: with Latinos. So I'm looking at Texas. Obviously California Sanders
Speaker 1: is polling pretty well, but Texas is also crucial. If
Speaker 1: Bernie Sanders can show that he can get you fifty
Speaker 1: six of the Latino voters tomorrow in some of these
Speaker 1: key states, I think that puts him in the conversation
Speaker 1: about leading this very diverse party to victory in November
Speaker 1: and takes a little wind out of Biden's sales because
Speaker 1: it's not just the African American vote. It's a higher
Speaker 1: turnout among African Americans, but certainly there are a lot
Speaker 1: of Latinos, and I think getting um, you know, Democrats
Speaker 1: get about seventy percent Latinos. Getting that vote and getting
Speaker 1: that vote up I think gives Bernie Sanderson bragging rights
Speaker 1: if that's what happens tomorrow. So Whendy, Tomorrow is a
Speaker 1: super Tuesday, a lot of delegates up for grabs. Who
Speaker 1: is it make or break for tomorrow? I think the
Speaker 1: obvious person is Amy Clobachar. So Amy Klobachar is leading
Speaker 1: in Minnesota right now by sort of national agate poles,
Speaker 1: but she's not trouncing Sanders right Sanders isn't within striking distance.
Speaker 1: If for some reason Sanders wins Minnesota and she loses Minnesota,
Speaker 1: I think there's just it's gonna be very hard for
Speaker 1: her to stay in the race. If you can't win
Speaker 1: your home state. Ask Al Gore Circuit two thousand when
Speaker 1: he law to his home state in the general election.
Speaker 1: You've got to win your home state. Same thing for
Speaker 1: Elizabeth Warren. You can make an argument about Massachusetts proximity
Speaker 1: to Vermont and Bernie Sanders popularity there, but she's got
Speaker 1: to come really close to winning, if not outright winning
Speaker 1: Massachusetts to really make a claim that you can, you know,
Speaker 1: successfully compete at the national level for the presidency. Professor
Speaker 1: Sheller had given your experience working with a variety of
Speaker 1: politicians and particularly serving on the staffs of Senator Daniel
Speaker 1: Patrick moynihan as well as Governor Mario Cuomo of New York,
Speaker 1: I'm wondering from your perspective, whether the Democrats are consolidating
Speaker 1: support enough early enough. In other words, what is sort
Speaker 1: of the make it or break it time when we
Speaker 1: have to see a certain degree of momentum emerging behind
Speaker 1: one candidate. Well, I'm not convinced that that they have
Speaker 1: to do that, because we look at what happened with
Speaker 1: Trump in UH and you know, there wasn't a lot
Speaker 1: of consensus there. He kept doing pretty well in terms
Speaker 1: of the proportional representation states earlier in the in the
Speaker 1: primaries for the Republicans and just emerged a somebody who
Speaker 1: they weren't going to be able to beat. That could
Speaker 1: very well happen with Bernie Sanders. So eventually, you know,
Speaker 1: Republicans unify, even if they say they didn't want Trump
Speaker 1: by election day, they got out the door and they
Speaker 1: voted in a unified way for Trump. Democrats did not
Speaker 1: do that for Hillary Clinton. So the D Day for
Speaker 1: Democrats is always election day in the in the national
Speaker 1: scope of things. But I just think, you know, Democrats
Speaker 1: have to decide. If they don't unify, they can't win.
Speaker 1: So this is just gonna be whoever it is. Bloomberg, Sanders,
Speaker 1: Biden and Bloomberg also could benefit from Pete Bout dropping out.
Speaker 1: If Amy Klobuchar drops out, then you know, creeping up
Speaker 1: and sort of being competitive with Biden. If Bloomberg can
Speaker 1: show that he can get some African American votes tomorrow
Speaker 1: in addition to latinos, he becomes a viable alternative to
Speaker 1: Bernie Sanders. So at some point Democrats are going to decide,
Speaker 1: as Republicans always do, that they're just going to get
Speaker 1: behind whoever the candidate is. And we should note that
Speaker 1: Michael Bloomberg is the founder and principal owner of Bloomberg
Speaker 1: LP and this radio station. So Wendy, let's talk about
Speaker 1: Mr Sanders here. Bernie Sanders can he beat Trump? And
Speaker 1: do you think do you agree with the concern that
Speaker 1: maybe he could actually hurt Democrats down ballot. You know,
Speaker 1: it's really sort of, you know, exploded all of our
Speaker 1: ability to predict really the average voters inclination a to
Speaker 1: get out the door to vote, which is something underestimated
Speaker 1: in terms of Trump supporters. And that's the magic ticket
Speaker 1: for Bernie Sanders. If he can win. He wins with
Speaker 1: the same kind of strategy the Trump had, which is
Speaker 1: tremendous enthusiasm among his supporters. So you know, people who
Speaker 1: like Bernie are getting out the door and they're going
Speaker 1: to make sure to vote. If he can actually, as
Speaker 1: he says in the debates, if I can expand that
Speaker 1: number of people who are really enthusiastic about me, he
Speaker 1: can sort of pull a Trump like victory. I do
Speaker 1: think there are challenges to that for him in particular areas,
Speaker 1: in particular swing states, but I don't think it's impossible
Speaker 1: to do if he follows that same playbook. And the
Speaker 1: thing to watch is African American turnout turn out generally
Speaker 1: in the primaries tomorrow among Democrats, but also African American
Speaker 1: turnout in places like North Carolina. If turnout is high,
Speaker 1: even if it's because bidens in the race or whatever reason,
Speaker 1: you want to say, if people vote in the primary,
Speaker 1: they're gonna vote in the general. That's usually what we see.
Speaker 1: So if Bernie can generate high turnout in the primaries,
Speaker 1: he's got an argument that those people will still come
Speaker 1: back to the polls in November. So I don't think
Speaker 1: anything should be you know, counted out as a possibility.
Speaker 1: I think it's going to be harder for him to
Speaker 1: explain how he'll pay for things that he's promised to do.
Speaker 1: But enthusiasm is the number one, you know, a component
Speaker 1: of turnout, and that's Bernie Sanders has that right now
Speaker 1: amongst a decent size of the Democratic Party. Wendy Schiller,
Speaker 1: thank you so much for being with us. Wendy Schiller,
Speaker 1: Professor of political science and public Policy at Brown University
Speaker 1: in a Providence, Rhode Island. Thanks for listening to the
Speaker 1: Bloomberg pen L podcast. You can subscribe and listen to
Speaker 1: interviews at Apple Podcasts or whatever podcast platform you prefer.
Speaker 1: Paul Sweeney, I'm on Twitter at pt Sweeney. I'm Lisa
Speaker 1: bram Woyds. I'm on Twitter at Lisa bramw wits one
Speaker 1: before the podcast. You can always catch us worldwide on
Speaker 1: Bloomberg Radio,