WEBVTT - Single Best Idea with Tom Keene: Bill Lee & Ellen Wald

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<v Speaker 1>Bloomberg Audio Studios, podcasts, radio news. Single best idea on

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<v Speaker 1>a Friday, will do it quickly? What a week? I mean?

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<v Speaker 1>Am I as exhausted as I was? What three weeks ago?

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<v Speaker 1>Six weeks ago? I don't think so. But nevertheless, my

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<v Speaker 1>head's spinning over the market reaction, over the worry about

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<v Speaker 1>long term yields. Just the reports of Japan midnight two

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<v Speaker 1>am Eastern Time on their GDP, of negative statistic on

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<v Speaker 1>GDP with some huge political ramifications. I'd look for that.

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<v Speaker 1>I think the trade negotiation I'm guessing. I'm not predicting.

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<v Speaker 1>I'm guessing the trade negotiations with Japan in the United

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<v Speaker 1>States will be absolutely fascinating. Just look at the size

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<v Speaker 1>of Toyota imports. Maybe not like the seventies of the eighties,

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<v Speaker 1>but still huge. It was great to catch up with

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<v Speaker 1>William Lee of the Milkin Institute. He's been incredibly busy

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<v Speaker 1>with their wonderful conference. Thank you to Carrol Masser, Salibassek

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<v Speaker 1>and our team Romain Bostic for the coverage out there

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<v Speaker 1>at Milkin. Here's Billy the chief economist of the Milkan Institute.

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<v Speaker 1>On tariffs and services.

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<v Speaker 2>It's pretty hard to tariff services, isn't it, especially when

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<v Speaker 2>when it's a license for American banks to sell financial

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<v Speaker 2>products in China and so so, I think the whole

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<v Speaker 2>notion that tariffs has been done away with, especially with

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<v Speaker 2>the different rounds of tarif productions we've had over many decades.

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<v Speaker 2>But they are real serious barriers to trade that Ricardo

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<v Speaker 2>didn't deal with. Our non tariff barriers, and the legal

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<v Speaker 2>requirements and health requirements and and and and quality standards

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<v Speaker 2>that are demanded of US exports into various countries. Those

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<v Speaker 2>are the obstacles that are part of the negotiation practice

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<v Speaker 2>that President Trump wanted to incentivize by putting up this

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<v Speaker 2>huge tier parias. Look, you guys, let's get service, getting

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<v Speaker 2>rid of the real series blocks the trade.

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<v Speaker 1>William Lee, We'll have them on for a longer conversation.

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<v Speaker 1>All of us work with the International Monetary Fund and

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<v Speaker 1>the Pacific RIM and now at Milkin Institute. Part of

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<v Speaker 1>what we do in Survanna as we do market coverage.

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<v Speaker 1>What's the stock market can do? Equities, bonds, currencies, commodities,

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<v Speaker 1>But we really like to speak with authorities. I can't

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<v Speaker 1>say enough about our conversation today with ellen Wald. The

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<v Speaker 1>book is Saudi inc. And she was just fabulous on

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<v Speaker 1>the nations and the tribes of the Arabian Peninsula and

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<v Speaker 1>from Morocco over to Persia as well. After the president's

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<v Speaker 1>trip to the Middle East, ellen Wald.

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<v Speaker 3>Every oil industry in the Middle East is run differently,

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<v Speaker 3>and I think that's a common misperception. People think it's

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<v Speaker 3>just this monolithic, you know, national oil companies, but it's

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<v Speaker 3>actually very different. A Rampo has a totally different break

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<v Speaker 3>even price from say the Kuwait Oil Company or or

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<v Speaker 3>you know the UAE or you know, even bock Rain

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<v Speaker 3>for example. So a Ramcos is basically the lowest in

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<v Speaker 3>the world. Their break even is, you know, depending on

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<v Speaker 3>what they're producing, you can be between two dollars and

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<v Speaker 3>ten dollars. They usually like to say around six. It's

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<v Speaker 3>kind of an average. That's the lowest in the entire world.

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<v Speaker 3>So no matter how low oil prices go, a Ramco

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<v Speaker 3>is still going to come out on top. Now that's

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<v Speaker 3>different from the price that the Saudi government would like

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<v Speaker 3>oil to be at to balance their budget, which I

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<v Speaker 3>think is really a totally useless figure. People like to

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<v Speaker 3>bring this out, the IMF likes to talk about it,

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<v Speaker 3>but that really doesn't influence the Saudi government all that

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<v Speaker 3>much because the Saudi government isn't selling oil. A Ramco

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<v Speaker 3>sells oil. The Saudi government gets revenue from that oil

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<v Speaker 3>and those oil sales, but they're not actually selling it,

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<v Speaker 3>and so their price point, their break even points are higher,

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<v Speaker 3>and they needed a higher price for their budget.

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<v Speaker 1>Ellen, well, the Atlantic and to excuse me, the Atlantic Council,

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<v Speaker 1>I should say there on the Middle East, single best

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<v Speaker 1>idea and of course on your commute across the nation,

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<v Speaker 1>the idea is to listen to Bloomberg Surveillance in the

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<v Speaker 1>morning on YouTube, subscribe to Bloomberg podcasts and on YouTube podcasts.

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<v Speaker 1>This is single best idea.