Speaker 1: Bloomberg Audio Studios, podcasts, radio news.
Speaker 2: The single best idea, which is to do it one
Speaker 2: hour podcast. We're not going to do that. We're going
Speaker 2: to keep it six minutes. We like doing a short podcast.
Speaker 2: I think it really fits in with what everybody else
Speaker 2: is doing out in global podcast world and all that.
Speaker 2: But what a day. We had endless conversations that were
Speaker 2: very rich about the mystery of what we're living in now,
Speaker 2: linking economics to finance, linking finance to investment, with an
Speaker 2: overview of international relations. Joe Matthew was on from balance
Speaker 2: of power with a real understanding of the mystery of
Speaker 2: the next thirty days for the White House, so many
Speaker 2: moving parts. There is a president gears up a campaign,
Speaker 2: and the candidate for the other side gears up endless
Speaker 2: days in a courtroom in New York. We'll move on
Speaker 2: from that to good conversations. One of them today was
Speaker 2: Terry Weisman. As I mentioned in the interview, the heritage
Speaker 2: here is back to bear Stearns and back to the
Speaker 2: development there. Larry Cudlow was the chief economist there, and
Speaker 2: then in came David Malpass and John Writing and Terry Weisman,
Speaker 2: and it was just really just an outstanding, always thought
Speaker 2: provoking discussion out of bear Stearns. This is ancient history.
Speaker 2: He's now Macquarie, the Australian Shop and Terry Weisman was
Speaker 2: just on fire and it was the why of the hope,
Speaker 2: the prayer or the consequences of a weaker dollar.
Speaker 1: The bear case for the dollar, if there's a structural one,
Speaker 1: is that the dollar will no longer be at some point,
Speaker 1: and no one knows when the world's reserve currency. Now,
Speaker 1: we are already seeing signs that this is manifest. We see,
Speaker 1: of course, we see China accumuly gold. Well, that's telling
Speaker 1: you that they may not like the dollar anymore. We
Speaker 1: certainly see the Russians moving away from dollar reserves. We've
Speaker 1: seen the Venezuelans do that now the Bowld case for
Speaker 1: the dollar as well. You can dismiss these countries because
Speaker 1: they're you know, part of this, I don't want to
Speaker 1: say access of evil obviously, but they're not on the
Speaker 1: same side of the fence as the US. But to
Speaker 1: the extent that we get a bipolarity in this world
Speaker 1: and we really get a true a new Berlin Wall
Speaker 1: that goes up between the West and the rest, you
Speaker 1: have to imagine that that's going to be bad for
Speaker 1: the dollar, because the dollar has benefited in this era
Speaker 1: of globalization. Anything that tends to reduce the amount of
Speaker 1: globalization tends to be bad for the dollar, and that
Speaker 1: new Berlin Wall would be bad for the.
Speaker 2: Dollar, Doctor Weisman from Acquarie. They're really thought provoking, and
Speaker 2: a lot of people are worried about this of losing
Speaker 2: our exorbitant privilege. Thank you to Berry chen Green of
Speaker 2: Berkeley over de velor as you started to staying in
Speaker 2: France decades ago for this idea of the exorbitant privilege
Speaker 2: we have in that so much of global business is
Speaker 2: done in US dollars. I should point out the IMF
Speaker 2: doing some world class work on dollar ascendancy and resiliency.
Speaker 2: Another conversation with it. First of all, Jeff Hugh was
Speaker 2: just lights out from BNY Mellon on the international sense
Speaker 2: and particularly on Weekyen. Meghan Robson was wonderful from BMP
Speaker 2: Perry Bob parsing through the different credit and particularly what
Speaker 2: big tech would do in tech issuance. Here. She didn't
Speaker 2: really think Apple or Microsoft would issue a lot of
Speaker 2: debt because of where the coupon is right now, but
Speaker 2: that was thought provoking. Excuse me, that's the single best idea. Gasp.
Speaker 2: Michael Darta with Roth Capital Markets was just on fire
Speaker 2: today about something he's champion for years, going back to
Speaker 2: his work with Judewininski a lifetime ago, and that was
Speaker 2: the idea of how you get to nominal GDP above
Speaker 2: four percent. Let's do the math with Michael Darta.
Speaker 3: If the underlying trend for the productive potential of the
Speaker 3: US economy is still around two in the FED has
Speaker 3: an inflation target of two that they're serious about, then
Speaker 3: top line growth is going to have to be curtailed
Speaker 3: and constrained to about a four percent pace. If productive
Speaker 3: potential is faster than that, you know, then we're we
Speaker 3: can enjoy faster nominal GDP growth. But that's that's very
Speaker 3: uncertain at this point in time. If you look at
Speaker 3: the tracking estimates or Q one GDP, you know, the
Speaker 3: expectation is two and a half to three real and
Speaker 3: a three percent GDP price deflator, so five and a
Speaker 3: half to six nominal. If four percent is sort of
Speaker 3: that's going to be too that's going to be too
Speaker 3: hot for the FED.
Speaker 2: Taed to that piece to your brain, go back and
Speaker 2: re listen to it here on single best idea and
Speaker 2: understand that this is pretty much foreign. We live in
Speaker 2: a real GDP environment, even though business and all of
Speaker 2: you live in a nominal environment of how much does
Speaker 2: that Hamburg cost this week at the meat counter. That's
Speaker 2: a nominal world. Fascinating conversation with Michael Darta of where
Speaker 2: we are now at five and six percent, some would
Speaker 2: say that's a boom economy, and any number of different opinions.
Speaker 2: One final shout out today Stephen Stanley at Santander was
Speaker 2: just absolutely fabulous about the heritage of the Richmond Fed
Speaker 2: in his work at Chicago. And William and Lee Washington
Speaker 2: and Lee I should say as well, get William and
Speaker 2: Mary in Washington. They're like, you know, they're in the
Speaker 2: same zip code. William and Mary and Washington Lee mixed up.
Speaker 2: We're on an Apple car Play Android play. I've got
Speaker 2: some nasty notes. We're on Android. We're not an Apple
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Speaker 2: is single best idea