WEBVTT - Remembering Paul Volcker 0:00:04.480 --> 0:00:07.680 Hello, and welcome to Stephanomics, the podcast that brings the 0:00:07.680 --> 0:00:14.960 global economy to you. You couldn't write an economic history 0:00:14.960 --> 0:00:19.239 of the past fifty years without multiple mentions of poor Volca, 0:00:19.440 --> 0:00:21.799 who died this week at the age of ninety two. 0:00:22.640 --> 0:00:25.040 If you think about it, he played a key role 0:00:25.120 --> 0:00:28.200 in not one, not two, but three of the financial 0:00:28.280 --> 0:00:31.960 landmark events of the past half century. He advised President 0:00:32.080 --> 0:00:34.879 Nixon on the decision to leave the gold standard, which 0:00:35.000 --> 0:00:37.760 led to the collapse of the whole post war Breton 0:00:37.800 --> 0:00:42.080 Wood system in one then, most famously, as Chair of 0:00:42.080 --> 0:00:44.519 the Federal Reserve for much of the eighties, he forced 0:00:44.560 --> 0:00:47.000 the US Central Bank to do what it took to 0:00:47.080 --> 0:00:51.000 confront inflation, even when what it took was a deep 0:00:51.000 --> 0:00:54.600 recession and a soaring dollar. And then he was still 0:00:54.640 --> 0:00:59.240 around in two thousand and eight advising President Obama on 0:00:59.280 --> 0:01:02.800 how to cope with fallout from the global financial crisis, 0:01:02.800 --> 0:01:07.280 devising new rules for banks which remain in diluted form today. 0:01:07.720 --> 0:01:10.600 Has a massive legacy which I'm going to discuss with 0:01:10.880 --> 0:01:15.119 Paul Boker's co author Bloomberg's Christine Harper in a few minutes. 0:01:15.600 --> 0:01:19.000 But first, India. Now India is a lot to get 0:01:19.040 --> 0:01:22.720 your head round. Even for so called experts, you'll surely 0:01:22.720 --> 0:01:24.880 know that it's got more than a billion people living 0:01:24.920 --> 0:01:26.920 in it. But along with that, it has twenty three 0:01:26.920 --> 0:01:30.640 major languages, eighty five political parties, and three hundred ways 0:01:30.720 --> 0:01:34.640 of cooking potato. It also has an ambitious Prime minister 0:01:34.920 --> 0:01:39.520 Knownrid Moody, who, like President Trump, has thrived by breaking 0:01:39.520 --> 0:01:43.120 with traditional models of how politicians should behave. But now 0:01:43.160 --> 0:01:46.000 the economy is hitting trouble and so is he. In 0:01:46.000 --> 0:01:48.800 a few minutes, I'll ask our India economist Abushek Gupta 0:01:48.800 --> 0:01:51.120 whether the Prime Minister Moody has the capacity to turn 0:01:51.200 --> 0:01:55.960 things round. But first, Bloomberg Economy reporter Annoban Nag has 0:01:56.000 --> 0:01:59.400 this report from the diamond mines of West central India. 0:02:06.280 --> 0:02:10.200 Take diamonds, Hollywood, A listeners and a two billion dollar 0:02:10.280 --> 0:02:13.640 fraud and you have all the ingredients of made for 0:02:13.760 --> 0:02:17.320 TV scandal that had all India paying attention. So there 0:02:17.400 --> 0:02:21.920 you have it. Now, Enforcement directed reading the offices of 0:02:22.200 --> 0:02:24.840 need A Moody, the famous jeweler who's really at the 0:02:24.919 --> 0:02:30.400 center of this entire scandal at the Punjab National Police 0:02:30.480 --> 0:02:35.040 rated the officers of Diamond mogul Nero Moody to investigate 0:02:35.120 --> 0:02:41.359 an Alex scam involving fake guarantees and sham transactions. Moody, 0:02:41.840 --> 0:02:45.040 who's not related to Prime Minister Narrendra Modi, was once 0:02:45.080 --> 0:02:48.880 a joweler to the stars. He had boutiques in London, 0:02:49.320 --> 0:02:55.399 Hong Kong and Mumbai. Nero Mody has denied wrongdoing. He's 0:02:55.440 --> 0:03:01.360 currently being held in the UK and fighting extradition to India. Meanwhile, 0:03:01.840 --> 0:03:06.240 India's renowned precious stone dealers are still reeling from the reprocursions. 0:03:06.320 --> 0:03:08.440 After it was first alerted of the bank loot in 0:03:08.480 --> 0:03:11.840 the sixteenth of January, it took Punjab National Bank almost 0:03:11.880 --> 0:03:16.880 a month to understand the extent and gravity. India's low 0:03:16.960 --> 0:03:20.000 cost and high scale labor has turned the country into 0:03:20.040 --> 0:03:25.079 a hub of global jewelry. India exports of the words 0:03:25.160 --> 0:03:30.240 polish diamonds, according to the industry's Export Promotion Council, many 0:03:30.280 --> 0:03:34.200 of which end up in engagement rings and diamond bracelets 0:03:34.520 --> 0:03:46.600 sold a jewelers like Tiffany's. According to the government, the 0:03:46.640 --> 0:03:50.960 sector employs nearly five million workers, accounting for almost seven 0:03:51.000 --> 0:03:54.840 percent of GDP, but the industry has been in serious 0:03:54.880 --> 0:04:01.280 trouble since the scandal broke, workers are losing jobs and 0:04:01.360 --> 0:04:05.839 businesses are shutting shops. If anything is to go by 0:04:05.920 --> 0:04:10.400 this way, Prime Minister Modi has little chance of achieving 0:04:10.520 --> 0:04:14.520 his goal of reaching one trillion dollars in annual exports 0:04:14.880 --> 0:04:18.440 over the next five years. It's also weighing on the 0:04:18.480 --> 0:04:25.000 broader economy. So what went wrong? For answers, we went 0:04:25.040 --> 0:04:28.440 to the diamond hub of Surat. The city is a 0:04:28.480 --> 0:04:31.920 three and a half hour train journey north from India's 0:04:31.920 --> 0:04:36.679 financial capital Mumbai. It's home to over a million people 0:04:36.760 --> 0:04:41.160 employed in the sector, including the skilled artisans that polished 0:04:41.160 --> 0:04:45.560 their diamonds. Many of them migrate from elsewhere in India, 0:04:46.040 --> 0:04:51.120 attracted by the prospects of higher income bubble by Criteria 0:04:51.520 --> 0:04:55.080 started off as one such artisan about four decades ago, 0:04:55.720 --> 0:05:00.440 and he now has the Seut Diamond Association. He wears 0:05:00.480 --> 0:05:03.560 a yellow and red thread around his right hand, an 0:05:03.560 --> 0:05:07.559 amulet worn by many of India's Hindus to protect someone 0:05:07.640 --> 0:05:12.239 from trouble. It's a protection that his industry really needs 0:05:12.360 --> 0:05:18.440 right now. I have seen many slowdowns in my more 0:05:18.520 --> 0:05:22.919 than forty year career in the diamond industry. The last 0:05:22.960 --> 0:05:26.599 time it was severe was in two thousand eight. But 0:05:27.160 --> 0:05:32.120 conditions had normalized after a couple of months. But this 0:05:32.279 --> 0:05:36.400 time the slowdowns has dragged on for seven eight months 0:05:36.440 --> 0:05:42.600 now and has hurt a business immensely. How with the 0:05:42.720 --> 0:05:47.000 Sponde is a skilled artisan with nearly two decades of experience. 0:05:48.440 --> 0:05:51.320 Five months ago, he reported to work at one of 0:05:51.360 --> 0:05:55.120 the thousands of diamond polishing factories, only to find the 0:05:55.160 --> 0:05:59.560 doors locked. The owner of the company had pulled down 0:05:59.600 --> 0:06:02.760 the shut ors overnight and fled without telling any of 0:06:02.880 --> 0:06:06.640 his forty workers. We were unable to track down the 0:06:06.839 --> 0:06:12.520 owner for comment. Ponde, who's thirty three, moved to Suos 0:06:12.560 --> 0:06:16.239 from across the country following the footsteps of his elder brother. 0:06:17.680 --> 0:06:20.839 Before losing his job, used to own the equivalent of 0:06:20.880 --> 0:06:24.640 around three d and fifteen dollars a month, roughly double 0:06:24.720 --> 0:06:29.600 the country's per capita income. But Ponde is now boring 0:06:29.640 --> 0:06:32.719 money from friends to pay the rent on his one 0:06:32.800 --> 0:06:38.320 room house and the tuition for his two kids. The 0:06:38.400 --> 0:06:42.880 owners shut shop without paying us our monthly salary. I 0:06:42.960 --> 0:06:46.040 have been roaming the streets in the past month and 0:06:46.200 --> 0:06:49.960 more trying to get another job. They leave in the 0:06:50.040 --> 0:06:53.680 morning and come back home in the evening, but no luck. 0:06:54.520 --> 0:06:59.040 Some factories say they don't have demand. Some say they 0:06:59.080 --> 0:07:03.440 don't have rough diamonds. The outcry following the near of 0:07:03.480 --> 0:07:08.480 Mody scandal has created an atmosphere of distrust between banks 0:07:08.520 --> 0:07:13.840 and jeweler's. Rob Vrani is a second generation director and 0:07:14.040 --> 0:07:18.640 be Vranian Company, a diamond cutting and polishing firm in Sura. 0:07:20.040 --> 0:07:23.160 He talked to us in his Glass World office about 0:07:23.200 --> 0:07:28.240 the factory floor. Behind him hangs his NBA diploma from 0:07:28.320 --> 0:07:32.960 Canada's Ryerson University. So liquidity crunches is one of the 0:07:32.960 --> 0:07:35.240 biggest problem. That is that kind of has you know, 0:07:35.840 --> 0:07:39.680 made this crisis even worse so because of these certain 0:07:40.280 --> 0:07:43.240 companies that do want ethical practices, right bank have I 0:07:43.240 --> 0:07:45.080 think all of a sudden they've said that we don't 0:07:45.080 --> 0:07:47.560 want to give credit to the diamond industry because there 0:07:47.560 --> 0:07:51.600 are there are many cases you know that. In addition, 0:07:52.040 --> 0:07:55.040 the trade war between China and the US has put 0:07:55.040 --> 0:08:00.080 a dampener on sales. Vrani said. While the US is 0:08:00.120 --> 0:08:03.800 the biggest consumer of Indian diamonds, a lot of stones 0:08:03.880 --> 0:08:10.640 transit through China for jewelry manufacturing or wholesale trading, with 0:08:10.800 --> 0:08:14.080 the U s cutting its purchases of Chinese goods. The 0:08:14.080 --> 0:08:19.200 Indian gem industry has felt the impact. So although India 0:08:19.280 --> 0:08:22.640 is not part of any global supply chain, exports have 0:08:22.880 --> 0:08:27.200 been hit, dragging down overall economic growth to four point 0:08:27.280 --> 0:08:30.520 five percent in the third quarter. It's lowest in six 0:08:30.600 --> 0:08:37.000 years back in sorl It's hard times as employment in 0:08:37.040 --> 0:08:40.839 the industry has fallen and incomes for skilled artisans has 0:08:40.880 --> 0:08:44.200 been reduced by more than sev in the past few months. 0:08:44.559 --> 0:08:49.960 According to industry groups pour of A, the Sponde, the 0:08:50.000 --> 0:08:54.040 Skilled Artisan it's a bleak and hard struggle, mirroring much 0:08:54.080 --> 0:08:57.760 of the slowdown in the economy when they had. I 0:08:57.840 --> 0:09:02.760 am so stressed right now. If this environment continues, then 0:09:02.800 --> 0:09:06.160 I have to consider leaving the industry and go back 0:09:06.200 --> 0:09:09.000 to the village and work in the field for a 0:09:09.160 --> 0:09:15.360 much less money. For Bloomberg News, I'm on near one now. 0:09:25.480 --> 0:09:30.040 So Abushek Gupta is Bloomberg's India economist. He's got a 0:09:30.040 --> 0:09:35.040 bit famous in the Indian market circles for disagreeing with 0:09:35.080 --> 0:09:37.520 other economists in Mumbai over what the Central Bank of 0:09:37.520 --> 0:09:39.760 India is going to do next, and I should say 0:09:39.760 --> 0:09:43.920 he's more often right than wrong. Abishek, thank you very 0:09:43.960 --> 0:09:46.760 much for joining us. Thanks a lot, Stephanie for having 0:09:46.760 --> 0:09:49.680 me on the show. It's a pleasure. So those of 0:09:49.760 --> 0:09:53.000 us who are not necessarily following every twist and turn 0:09:53.120 --> 0:09:57.080 of the Central banks policies or indeed the Government of 0:09:57.160 --> 0:10:00.480 India's policies, you know, we hear that story there from 0:10:00.520 --> 0:10:04.280 Annaba Nag about how the diamond industry has been affected 0:10:04.320 --> 0:10:08.240 by trade wars and by the slowing of the Indian economy. 0:10:08.360 --> 0:10:11.200 If we step back from the day to day of 0:10:11.640 --> 0:10:14.800 central bank policy and what's going on a month to 0:10:14.840 --> 0:10:18.760 month with the economy, you know, most people will have noticed. 0:10:18.800 --> 0:10:21.920 I think when No Injury Moody came to office in 0:10:21.920 --> 0:10:25.640 India in fourteen he got reelected again um this year, 0:10:25.800 --> 0:10:28.760 there was a lot of talk about major reform and 0:10:28.920 --> 0:10:32.520 putting the economy on a completely different trajectory. We have 0:10:32.640 --> 0:10:35.280 seen reforms, but if you look at the state of 0:10:35.280 --> 0:10:38.520 the economy, it doesn't look that great. What's happened, Stephanie, 0:10:38.600 --> 0:10:42.320 I think that that's that's a great question. And indeed, 0:10:42.760 --> 0:10:45.560 if you look at No into more these drag record 0:10:45.640 --> 0:10:49.040 over the last few years, he has certainly delivered on 0:10:49.120 --> 0:10:53.280 a lot of significant structional reforms, I'll say, but the 0:10:53.320 --> 0:10:57.200 way I think about these reforms is that they aren't 0:10:57.200 --> 0:11:01.960 necessarily growth in anything at least in the short run. 0:11:02.400 --> 0:11:06.200 They prove efficiency and productivity over the medium term, but 0:11:06.320 --> 0:11:09.560 what's exactly happening in the near term. For instance, let's 0:11:09.559 --> 0:11:12.679 just pick up one of the reforms, like Marin Smoothie 0:11:13.120 --> 0:11:17.240 delivered on a new bankruptcy law for India, and under 0:11:17.280 --> 0:11:21.160 this law, what's happening is that, or instance, bad assets 0:11:21.200 --> 0:11:25.080 would now be changing hands, so from an old promoter 0:11:25.160 --> 0:11:28.600 to a new promoter, and that and sometimes things get 0:11:28.640 --> 0:11:32.320 delayed in the legal process and stuff like this would 0:11:32.400 --> 0:11:36.360 negatively impact the economic activity of that secution it in 0:11:36.400 --> 0:11:39.679 the short run, and similarly for other reforms as well, 0:11:40.080 --> 0:11:43.280 in the short run, in the initial years of these reforms, 0:11:43.640 --> 0:11:47.719 uh this that's uh, there's a transition phase which kind 0:11:47.720 --> 0:11:51.360 of slows things down. Having said that, my sense would 0:11:51.400 --> 0:11:54.160 have been that over the past few years, things should 0:11:54.160 --> 0:11:57.679 have already started looking up by now, but that has 0:11:57.720 --> 0:12:01.280 not been the case, And I kind of put the 0:12:01.280 --> 0:12:06.080 blame more on not sufficient monitor easy rather than not 0:12:06.960 --> 0:12:11.440 more reforms. So clearly, I think Monkey policy could have 0:12:11.480 --> 0:12:15.120 done a lot more to support government structural reforms. Barallelly, 0:12:15.440 --> 0:12:18.720 but that hasn't been the case so far. Yeah, and 0:12:18.760 --> 0:12:21.199 it's true you've had you you were very critical and 0:12:21.280 --> 0:12:25.800 particularly of the previous head of the Reserve Bank of India. 0:12:26.400 --> 0:12:30.160 Um and when when the when Moody effectively got rid 0:12:30.200 --> 0:12:33.360 of him. You know, often when when governments interfere with 0:12:34.280 --> 0:12:36.040 who's going to run the central bank, there's a lot 0:12:36.080 --> 0:12:39.640 of concern in the markets about the independence of the 0:12:39.679 --> 0:12:43.680 central bank being violated. But it was striking that there 0:12:43.760 --> 0:12:46.400 was not that kind of reaction from the markets when 0:12:46.440 --> 0:12:49.520 that happened, perhaps because investors agree with you that that 0:12:49.559 --> 0:12:53.200 the bank had been too tight. Yes, certainly that has 0:12:53.240 --> 0:12:55.360 been the case. In fact, one of the key even 0:12:55.800 --> 0:13:00.400 holding back India's economy is the weak state of uh 0:13:00.440 --> 0:13:05.400 India's shadow banking sector. There are these non bank finance 0:13:05.440 --> 0:13:09.920 companies in India which essentially are extending credit to consumers 0:13:10.040 --> 0:13:15.320 and housing finance companies, and these companies were quite negatively 0:13:15.360 --> 0:13:20.000 impacted due to a liquidly crunch which was created in 0:13:20.000 --> 0:13:24.920 the economy in late twenty eighteen under the earlier RB governorate. 0:13:25.760 --> 0:13:28.600 Over the last year, the new Central Bank governor has 0:13:28.840 --> 0:13:32.040 reversed some of those politty mistakes and we have seen 0:13:32.480 --> 0:13:36.679 credit spreads come down for the better rated companies, but 0:13:36.840 --> 0:13:39.600 some of the weak created companies, the credit spreads are 0:13:39.600 --> 0:13:43.880 still widening. And and that is financial financial shock that 0:13:43.960 --> 0:13:46.240 needs to be eased. I mean, we we've we had 0:13:46.240 --> 0:13:48.840 a bit in that piece about the pain that some 0:13:48.920 --> 0:13:53.160 of that the financial squeeze is causing in the diamond 0:13:53.200 --> 0:13:56.760 sector and for some for some in that region. But 0:13:56.800 --> 0:14:02.520 obviously this is an enormously diverse economy. Um, the rural 0:14:02.600 --> 0:14:06.880 sectors particularly important, not just economically but politically. If you're 0:14:07.880 --> 0:14:11.280 sitting in a rural area, how have how have you 0:14:11.320 --> 0:14:14.679 really felt the impact of Prime Minister Moodi or maybe 0:14:14.720 --> 0:14:19.320 you haven't felt that much different that's a separate discussion altogether. 0:14:19.400 --> 0:14:22.920 So I mean, if you look at Prime Minister Marrieds 0:14:23.000 --> 0:14:28.400 Moodies policies, he has also reinvented himself in the in 0:14:29.000 --> 0:14:32.600 his political party, the b JP, in terms of delivering 0:14:32.800 --> 0:14:37.280 more welfare oriented policies of the rural pool. In fact, 0:14:37.400 --> 0:14:41.720 if you sort of talk about giving free gas cylinder 0:14:41.760 --> 0:14:45.480 than gas connections, that that's being a very popular policy. 0:14:46.000 --> 0:14:49.640 Constructing toilets that has been another major campaign of his. 0:14:50.520 --> 0:14:55.360 And besides that, he's also increased electrification in rural villages 0:14:55.920 --> 0:14:59.720 and opened bank accounts for for the rural poor. And 0:15:00.240 --> 0:15:04.080 just this year he had announced an income support package 0:15:04.080 --> 0:15:07.360 for farmers. So I think he has done a lot 0:15:08.000 --> 0:15:11.640 for the rural poor. However, the impact of that has 0:15:11.720 --> 0:15:16.200 been missing in terms of consumption. But probably the rural 0:15:16.280 --> 0:15:20.680 economy has benefited from American movies policies. And if you 0:15:20.720 --> 0:15:23.600 speak to taxi drivers in India who kind of come 0:15:23.760 --> 0:15:27.760 from some of these rural villages in smaller towns, they 0:15:27.800 --> 0:15:33.400 do confirmed that either they themselves and their families or 0:15:33.400 --> 0:15:37.400 the extended families people have benefited from reading the movies policies. 0:15:37.440 --> 0:15:41.720 So so he is popular in rural India as well. Hm, 0:15:42.240 --> 0:15:44.680 that's interesting. I mean, I I guess people from a 0:15:44.720 --> 0:15:47.240 distance will be wondering. I mean, he's a He's a 0:15:47.240 --> 0:15:50.240 prime minister who has been controversial often outside of India 0:15:50.320 --> 0:15:56.560 for his treatment of people in Kashmir. He's violated the 0:15:56.680 --> 0:15:58.960 human rights in some ways or has been criticized for that. 0:15:59.040 --> 0:16:01.960 He's also um not always been a fan of of 0:16:01.960 --> 0:16:06.520 of press freedom. I think investors have sort of weighed 0:16:06.520 --> 0:16:10.160 that against his ability to get the economy going. But 0:16:10.360 --> 0:16:14.760 how important is it for his future to really change 0:16:14.800 --> 0:16:16.760 the performance of the economy, or is he in a 0:16:16.960 --> 0:16:20.120 is he in a strong enough now position politically that 0:16:20.200 --> 0:16:24.360 he just needs to avoid a big recession. I think 0:16:24.400 --> 0:16:26.960 that that's that's a very important question that that hits 0:16:27.000 --> 0:16:30.040 said the point in terms of what will drive his 0:16:30.120 --> 0:16:33.720 re election in two um. If you look at the 0:16:33.840 --> 0:16:36.640 first year of a second term, he has had great 0:16:36.640 --> 0:16:42.440 success in terms of delivering policies and legislation that appeals 0:16:42.480 --> 0:16:46.160 to his majority in the water base. Be it as 0:16:46.160 --> 0:16:49.920 you said, the application of Article three seventeen englishmir on 0:16:50.080 --> 0:16:54.360 the Supreme Court ruling in favor of a temple um 0:16:55.800 --> 0:17:00.720 or the current sort of ship amendment will which is 0:17:01.000 --> 0:17:05.560 uh we just got past yesterday in the Parliament, which 0:17:05.960 --> 0:17:10.320 discriminates against Muslims. So all of these kinds of things 0:17:10.840 --> 0:17:16.040 do appeal to those database and have maintained his popularity 0:17:16.600 --> 0:17:20.480 with the masters. But my sense is that this is 0:17:20.520 --> 0:17:23.280 not what is going to count in four And I 0:17:23.280 --> 0:17:27.000 think even he understands the importance of reviving the economy 0:17:27.560 --> 0:17:32.080 because he had initially in twenty fourteen run on the 0:17:32.320 --> 0:17:37.840 end of development and he needs to bring economic prosperity 0:17:37.920 --> 0:17:42.359 and bring jobs for the junk demographic force, which is 0:17:43.440 --> 0:17:46.240 coming into the job market, and that is why he 0:17:46.320 --> 0:17:50.960 has been focusing a lot on this dollar five brillion economy. Well, 0:17:51.000 --> 0:17:54.879 we will watch and wait, bishek Upta, thank you very much. Thanks. 0:18:01.320 --> 0:18:04.439 I said something about Paul Volca at the beginning of 0:18:04.480 --> 0:18:08.440 the program. Who's died this week, But someone who got 0:18:08.480 --> 0:18:10.399 to spend a lot of time with him in the 0:18:10.480 --> 0:18:14.160 last few years is Bloomberg's own Christine Harper, whose editor 0:18:14.200 --> 0:18:18.760 of Markets magazine but also wrote with Paul Vocer a 0:18:18.800 --> 0:18:22.760 memoir keeping at It, The Quest for Sound Money and 0:18:22.800 --> 0:18:26.440 Good Government, which only came out a year ago. Christine, 0:18:27.040 --> 0:18:30.560 I know you've you've written and had conversations with people 0:18:30.600 --> 0:18:33.639 in the last few days since Paul Voker died. I 0:18:33.640 --> 0:18:37.920 guess one question to ask you is about the difference 0:18:38.000 --> 0:18:41.280 between the legend of Paul Volca, who I certainly found 0:18:42.040 --> 0:18:44.800 quite scary the few times that I interviewed him, not 0:18:44.920 --> 0:18:48.680 least because he was so tall, and the man that 0:18:48.680 --> 0:18:50.800 that you got to know in writing this book because 0:18:50.800 --> 0:18:52.639 it didn't quite work out the way you thought it 0:18:52.640 --> 0:18:55.080 was going to go. Yes, I would say that's true. 0:18:55.119 --> 0:18:59.440 And my understanding is that most people who have had 0:19:00.040 --> 0:19:03.040 some personal dealings with him have come away with the 0:19:03.080 --> 0:19:06.280 same conclusion, which is that he has this very forbidding 0:19:06.800 --> 0:19:09.520 public persona. I mean, if you look at the you know, 0:19:09.600 --> 0:19:13.000 the photography UM taken while he was fed chairman, or 0:19:13.040 --> 0:19:15.520 the or the caricatures that were drawn of him, he 0:19:15.560 --> 0:19:18.719 was always as a sort of Olympian godlike figure glowering 0:19:18.800 --> 0:19:21.720 down at the mere mortals, who were you know, screwing 0:19:21.760 --> 0:19:24.639 up the planet um. And so he did have this 0:19:25.000 --> 0:19:27.680 He had this kind of Old Testament quality to him. 0:19:27.880 --> 0:19:31.960 But once you met him in person, he was absolutely 0:19:32.040 --> 0:19:35.000 a sweetie pie. He was one of those people who 0:19:35.040 --> 0:19:39.840 seem like rough and could use that fearsome persona to 0:19:40.680 --> 0:19:45.080 sort of achieve outcomes he wanted and take on, you know, 0:19:45.840 --> 0:19:50.960 people or institutions he felt weren't living up to their requirements. 0:19:50.960 --> 0:19:54.159 But he loved people and he was. He was actually 0:19:54.240 --> 0:19:59.040 quite shy, and he was very humorous, and he was 0:19:59.400 --> 0:20:04.119 unbelievable the kind. So when I first met him, I was, 0:20:04.600 --> 0:20:08.920 I think, like anybody, quite nervous, and he instantly won 0:20:09.000 --> 0:20:12.880 me over. He was very funny, love telling stories, chuckled 0:20:12.920 --> 0:20:16.639 a lot, and was always smiling, nothing like what I expected, 0:20:17.000 --> 0:20:20.000 And as I got to know him more, part of 0:20:20.040 --> 0:20:22.000 what I really enjoyed talking to him was, of course 0:20:22.040 --> 0:20:25.399 he had amazing stories about knowing everybody from you know, 0:20:25.440 --> 0:20:29.480 the leaders of basically every country. He served under six presidents. 0:20:29.560 --> 0:20:33.080 You know, he's he's had this kind of incredible career. 0:20:33.240 --> 0:20:37.040 But but he also loved to talk about the crossword 0:20:37.080 --> 0:20:40.760 puzzle or he was a passionate home cook, and he 0:20:40.760 --> 0:20:43.040 would talk about the recipes in the New York Times. 0:20:43.040 --> 0:20:45.280 And you know, when he found an editing error, he 0:20:45.320 --> 0:20:49.240 would he would relish that he'd found something like that. Um. 0:20:49.280 --> 0:20:52.160 He was really fun to be around and really pleasant 0:20:52.440 --> 0:20:57.560 and kind and uh and I think in some ways, 0:20:57.680 --> 0:21:01.560 you know, he he stood for for the people in 0:21:01.800 --> 0:21:04.760 what he tried to do publicly, he always put himself 0:21:04.760 --> 0:21:08.760 as somebody who wanted to take on corrupt influences and 0:21:08.760 --> 0:21:11.280 and make the government better and make the economy better 0:21:11.400 --> 0:21:14.760 for for the for the people. But he really did 0:21:14.800 --> 0:21:17.119 love people. He you know, he took the regular city 0:21:17.160 --> 0:21:19.320 bus to and from his office until he was ninety 0:21:19.359 --> 0:21:23.480 years old. He didn't put himself apart. He he really 0:21:23.520 --> 0:21:26.199 saw himself as a public servant. I thought I was 0:21:26.240 --> 0:21:29.119 smiling at one of the comments in the Bitteries about 0:21:29.240 --> 0:21:32.359 him often having shiny suits. You could imagine the Wall 0:21:32.400 --> 0:21:35.520 Street people being a bit sniffy about him not having 0:21:35.520 --> 0:21:38.280 spent money on his suits when he was FED chairman, 0:21:38.480 --> 0:21:42.000 you know, famously, he sort of got a little studio 0:21:42.040 --> 0:21:45.280 apartment in a building close to the FED that was 0:21:45.320 --> 0:21:49.560 basically all you know, college students living there. And he 0:21:50.359 --> 0:21:52.359 had I think a table, a chair, a bed, and 0:21:52.400 --> 0:21:55.800 some milk crates. And he would take his laundry to 0:21:56.000 --> 0:21:58.600 his daughters who lived nearby, to get it done every week. 0:21:58.640 --> 0:22:00.879 And you know that's because his wife was stayed up 0:22:00.880 --> 0:22:02.960 in New York and was was quite ill, and she 0:22:03.040 --> 0:22:05.119 was taking care of their son, who had some disabilities, 0:22:05.640 --> 0:22:07.560 and she didn't want to move. So he just lived 0:22:07.560 --> 0:22:09.960 like this bachelor and flew back home every weekend. He 0:22:10.040 --> 0:22:12.840 really didn't care about things. I mean, I remember him 0:22:12.880 --> 0:22:15.760 once telling me he thought all of the furniture in 0:22:15.920 --> 0:22:18.439 his apartment, which was quite a nice apartment in New 0:22:18.520 --> 0:22:20.560 York that he bought at the bottom of the real 0:22:20.680 --> 0:22:24.080 estate market in nineteen seventy three or something, all of 0:22:24.080 --> 0:22:26.960 that furniture was probably you know, fifty years old or something. 0:22:27.040 --> 0:22:30.399 He didn't he didn't really care um. He cared about people. 0:22:30.440 --> 0:22:36.600 He cared about UM principles, UM. He cared that society 0:22:36.840 --> 0:22:39.840 do right by people. But he wasn't he was a materialistic, 0:22:39.840 --> 0:22:43.800 He wasn't selfish. I was. I was appalled that was 0:22:43.840 --> 0:22:46.000 an event a few years ago that I was speaking 0:22:46.000 --> 0:22:48.040 at was a sort of private thing of people thinking 0:22:48.080 --> 0:22:49.919 about the global economy. And I was a pulled when 0:22:49.960 --> 0:22:51.480 I saw the program that I was supposed to be 0:22:51.520 --> 0:22:55.080 co presenting with Paul Volka. And then I rapidly realized 0:22:55.080 --> 0:22:57.120 that it was actually quite liberating because it wouldn't matter 0:22:57.119 --> 0:22:59.399 at all what I said, because people would really just 0:23:00.000 --> 0:23:01.960 what he said. But what did you find? I mean, 0:23:02.080 --> 0:23:06.639 did you find that he was actually quite cheerful? And 0:23:06.680 --> 0:23:11.640 it was also increasingly he had and we've spoken about 0:23:11.640 --> 0:23:13.800 this in the past. I mean that he was getting 0:23:13.800 --> 0:23:18.000 on and he certainly and he had his voice was definitely, 0:23:18.040 --> 0:23:20.880 you know, reflected his age. So sometimes when you're interviewing him, 0:23:21.160 --> 0:23:23.720 at least the first time I interviewed him, I found 0:23:23.720 --> 0:23:27.520 it sort of disconcerting that I was I was expecting 0:23:27.560 --> 0:23:29.800 this person to play a crucial role in whatever piece 0:23:29.840 --> 0:23:32.960 I was doing and deliver this great interview, and yet 0:23:33.040 --> 0:23:35.320 he seemed, you know, he was in his late eighties 0:23:35.359 --> 0:23:37.320 and would he possibly deliver. But then, of course you 0:23:37.640 --> 0:23:40.200 the moment he started talking, you realized that he had 0:23:40.240 --> 0:23:43.920 not only really prepared for the interview, but had incredibly 0:23:44.000 --> 0:23:46.280 wise and sharp things to say that you wouldn't have 0:23:46.280 --> 0:23:48.680 got from anyone out. So I always I did found 0:23:48.680 --> 0:23:50.520 it a pleasure of that you had to, as you say, 0:23:50.560 --> 0:23:54.240 you have to get past that rather intimidating demeanor, where 0:23:54.280 --> 0:23:56.320 he did often seem to be sort of scowling when 0:23:56.320 --> 0:23:58.280 I don't. I don't think he was. But we've talked 0:23:58.280 --> 0:24:00.480 a lot about the personal stuff, which I think is 0:24:00.480 --> 0:24:04.119 is always important to remember and a nice thing to 0:24:04.200 --> 0:24:07.440 remember this week. But I'm of course people will also 0:24:07.520 --> 0:24:09.879 be interested, particularly since you got to know him in 0:24:09.920 --> 0:24:13.840 the last few years, of what his attitude was to 0:24:14.640 --> 0:24:22.240 the current members of the American administration and particularly Donald Trump. Yes, well, um, 0:24:22.280 --> 0:24:26.840 that was a constant source of frustration, because I think 0:24:26.880 --> 0:24:30.359 one of the things about him that made him really 0:24:30.440 --> 0:24:32.760 different was that even though he could he could have 0:24:32.800 --> 0:24:36.040 a quite harsh judgment uncertain things if he felt they 0:24:36.040 --> 0:24:38.920 were clearly wrong, Like he had no tolerance for sort 0:24:38.920 --> 0:24:42.720 of people he felt were overpaid and you know, enriched themselves, 0:24:42.720 --> 0:24:46.240 at the expense of their customers or the public, or 0:24:46.800 --> 0:24:50.040 or you know who corrupted institutions. But he he was 0:24:50.280 --> 0:24:52.920 he was an other in many other respects, this incredibly 0:24:52.960 --> 0:24:56.159 pragmatic and this incredible sort of tolerant person. So he 0:24:56.600 --> 0:24:59.400 wanted to give everybody the benefit of the doubt. So 0:24:59.520 --> 0:25:02.440 as much as you know, I and I know other 0:25:02.480 --> 0:25:04.680 people were trying to kind of get him to come 0:25:04.680 --> 0:25:08.800 out and you know, cast strong views on the situation, 0:25:08.840 --> 0:25:10.720 I think you know, he served under six presidents, he 0:25:10.760 --> 0:25:14.639 served under Nixon, he served under you know, LBJ and Kennedy. 0:25:14.640 --> 0:25:18.159 He'd seen a lot of things, and so he was 0:25:18.280 --> 0:25:21.960 patient in a way that not many people are. Um. 0:25:22.000 --> 0:25:25.439 I do know that at the end Um and you know, 0:25:25.480 --> 0:25:29.399 he worked with me on a afterward for the paperback 0:25:29.520 --> 0:25:33.639 version of his book. He he expressed more concerned about 0:25:33.760 --> 0:25:35.960 the state of the world because in his book, in 0:25:36.000 --> 0:25:39.359 the book he um he talked about how you know, 0:25:39.440 --> 0:25:42.800 his mother had admonished him that things can look bad, 0:25:42.840 --> 0:25:44.920 but this country has gotten through a lot and will 0:25:44.960 --> 0:25:47.560 continue to be okay. But he wasn't so sure he 0:25:47.600 --> 0:25:50.840