1 00:00:00,120 --> 00:00:06,760 Speaker 1: Bloomberg Audio Studios, Podcasts, radio News. 2 00:00:11,640 --> 00:00:15,440 Speaker 2: This is the Bloomberg Surveillance Podcast. I'm Jonathan Ferrow, along 3 00:00:15,480 --> 00:00:18,680 Speaker 2: with Lisa Bromwitz and Amrie Hordern. Join us each day 4 00:00:18,720 --> 00:00:22,280 Speaker 2: for insight from the best in markets, economics, and geopolitics 5 00:00:22,400 --> 00:00:24,920 Speaker 2: from our global headquarters in New York City. We are 6 00:00:24,920 --> 00:00:27,680 Speaker 2: live on Bloomberg Television weekday mornings from six to nine 7 00:00:27,720 --> 00:00:31,280 Speaker 2: am Eastern. Subscribe to the podcast on Apple, Spotify, or 8 00:00:31,320 --> 00:00:33,960 Speaker 2: anywhere else you listen, and as always on the Bloomberg 9 00:00:34,040 --> 00:00:37,080 Speaker 2: Terminal and the Bloomberg Business app. We begin this hour 10 00:00:37,080 --> 00:00:39,120 Speaker 2: with Stoff sitting near all time highs, the S and 11 00:00:39,120 --> 00:00:42,520 Speaker 2: P five hundred approaching six thousand, notching its forty ninth 12 00:00:42,600 --> 00:00:45,720 Speaker 2: record so far this year, Equities heading towards their best 13 00:00:45,720 --> 00:00:48,000 Speaker 2: week of twenty twenty four as Trump takes back the 14 00:00:48,000 --> 00:00:51,160 Speaker 2: White House and Vin Powell continues cunning interest rates. Joining 15 00:00:51,200 --> 00:00:54,120 Speaker 2: us now Mohammad Erin of Queen's College, Cambridge. Mohammed, Welcome 16 00:00:54,160 --> 00:00:56,360 Speaker 2: to the program. I know you watch the news conference, 17 00:00:56,360 --> 00:00:58,320 Speaker 2: so let's start there. What would your takeaway? 18 00:01:00,160 --> 00:01:01,120 Speaker 3: So three takeaways? 19 00:01:01,160 --> 00:01:05,000 Speaker 4: John One is as expected in terms of the characterization 20 00:01:05,080 --> 00:01:09,800 Speaker 4: of policy, desire to maintain optionality. And then where I 21 00:01:09,880 --> 00:01:14,440 Speaker 4: really felt for him, John is not in his response 22 00:01:14,600 --> 00:01:20,160 Speaker 4: to the question Visa VIVI the President elect, where pow 23 00:01:20,360 --> 00:01:23,920 Speaker 4: the lawyer came out very strongly. It is this sort 24 00:01:23,920 --> 00:01:29,280 Speaker 4: of muddled view of what is going on and inability 25 00:01:29,280 --> 00:01:32,520 Speaker 4: to pivot forward. So think of his responses to the 26 00:01:32,640 --> 00:01:36,760 Speaker 4: question of decomposition of the bond yield. Think of his 27 00:01:37,080 --> 00:01:40,000 Speaker 4: characterization of real wages, does he want them higher, does 28 00:01:40,000 --> 00:01:42,800 Speaker 4: he want them lower? Think of his characterization of the 29 00:01:42,880 --> 00:01:47,280 Speaker 4: labor market. And then that key question by Mike McKee 30 00:01:47,640 --> 00:01:49,120 Speaker 4: when he said you've. 31 00:01:48,960 --> 00:01:51,640 Speaker 1: Looked backwards, what about forward? 32 00:01:52,080 --> 00:01:55,560 Speaker 4: And he Powell ended up talking backwards, And you get 33 00:01:55,680 --> 00:01:58,360 Speaker 4: very strongly a couple of feelings. Certainly I did what 34 00:01:58,520 --> 00:02:01,160 Speaker 4: I felt for him. One is he's become totally hostage 35 00:02:01,240 --> 00:02:05,600 Speaker 4: to data. And two is that he is. 36 00:02:05,520 --> 00:02:07,880 Speaker 1: In this world of the seventies. 37 00:02:07,440 --> 00:02:11,320 Speaker 4: And eighties where once you are away from the extremes 38 00:02:11,360 --> 00:02:14,520 Speaker 4: of really high inflation or the threat of deflation, that 39 00:02:14,639 --> 00:02:18,960 Speaker 4: somehow we believe monetary policy can fine tune outcomes, and 40 00:02:19,040 --> 00:02:22,880 Speaker 4: we know that if you overrely on demand management to 41 00:02:23,000 --> 00:02:26,639 Speaker 4: fine tune, you end up with all sorts of creduital damage. 42 00:02:26,720 --> 00:02:29,760 Speaker 4: I really felt for him, but not for the political 43 00:02:29,800 --> 00:02:31,799 Speaker 4: reasons that most of the media is covering right now. 44 00:02:31,840 --> 00:02:33,560 Speaker 2: Somehow, as you've said this a few times, the lack 45 00:02:33,600 --> 00:02:36,720 Speaker 2: of a strategic underpinning. Could you just provide some clarity 46 00:02:36,760 --> 00:02:38,919 Speaker 2: on what you think that underpinning should be. Given the 47 00:02:38,960 --> 00:02:41,399 Speaker 2: lack of clarity we have about the so called trifecta 48 00:02:41,440 --> 00:02:44,120 Speaker 2: down in Washington, d C. What policy might look like, 49 00:02:44,160 --> 00:02:47,000 Speaker 2: the margins that work through to get that clarity for 50 00:02:47,040 --> 00:02:49,280 Speaker 2: twenty twenty five and really to sit there in December, 51 00:02:49,560 --> 00:02:51,280 Speaker 2: which I think we all agree, is that much harder 52 00:02:51,320 --> 00:02:54,400 Speaker 2: meeting to make a decision on interest rates and to 53 00:02:54,400 --> 00:02:55,400 Speaker 2: provide forecasts. 54 00:02:56,840 --> 00:02:59,560 Speaker 4: It shouldn't have been a harder meeting, John, It shouldn't 55 00:02:59,560 --> 00:03:03,560 Speaker 4: have been a hard to meeting because there was great 56 00:03:03,600 --> 00:03:05,959 Speaker 4: clarity back in July, and you and I talked about 57 00:03:05,960 --> 00:03:11,480 Speaker 4: this that it was time to start reducing rates, that 58 00:03:11,720 --> 00:03:14,760 Speaker 4: he could have done it twenty five, twenty five, twenty five, 59 00:03:15,560 --> 00:03:19,600 Speaker 4: we were a distance from most estimate of the neutral rate, 60 00:03:19,639 --> 00:03:23,600 Speaker 4: which is somewhere in the upper threees I think, And 61 00:03:23,639 --> 00:03:24,560 Speaker 4: there's a distance to. 62 00:03:24,520 --> 00:03:27,560 Speaker 1: Go, and you would use the restrict interst of policy. 63 00:03:27,600 --> 00:03:32,399 Speaker 4: Instead, we got no change in July fifty in September, 64 00:03:32,919 --> 00:03:35,440 Speaker 4: then a sense you know what fifty was a mistake, 65 00:03:35,480 --> 00:03:38,840 Speaker 4: We got the twenty five and now, as Lisa pointed out, 66 00:03:38,880 --> 00:03:42,440 Speaker 4: probably is are changing vis December. You know, this is 67 00:03:42,480 --> 00:03:45,560 Speaker 4: not what policy should be doing, but this is what 68 00:03:45,600 --> 00:03:49,480 Speaker 4: policy ends up doing. When you are excessively data dependent. 69 00:03:50,160 --> 00:03:54,520 Speaker 4: You have a pass towards closer to neutral, You have 70 00:03:54,680 --> 00:03:59,920 Speaker 4: reasons why you should pursue this, and if the election 71 00:04:00,120 --> 00:04:03,200 Speaker 4: promises tend to end up to be reality, then you 72 00:04:03,200 --> 00:04:06,280 Speaker 4: could change a strategic view. But as he rightly said, 73 00:04:06,440 --> 00:04:09,360 Speaker 4: we don't know how much of this will end up 74 00:04:09,400 --> 00:04:10,880 Speaker 4: being actual implementation. 75 00:04:11,440 --> 00:04:14,640 Speaker 5: His strategic view, Mohammed seems to be let's cut by 76 00:04:14,640 --> 00:04:17,320 Speaker 5: twenty five as they just did, and then maybe twenty 77 00:04:17,360 --> 00:04:20,680 Speaker 5: five again in December, and then the question really becomes 78 00:04:20,920 --> 00:04:23,040 Speaker 5: a blank slate. He said that they will have more 79 00:04:23,120 --> 00:04:25,719 Speaker 5: data to really make that assessment, putting the focus much 80 00:04:25,760 --> 00:04:28,520 Speaker 5: more on CPI. Do you think it was a mistake 81 00:04:28,880 --> 00:04:32,120 Speaker 5: for him to reintroduce the emphasis on the FEDS mandate 82 00:04:32,160 --> 00:04:35,040 Speaker 5: of inflation after basically kicking it to the curb and 83 00:04:35,040 --> 00:04:36,839 Speaker 5: focusing simply on the employment picture. 84 00:04:37,839 --> 00:04:40,640 Speaker 1: Yeah, it was such a confused discussion. I mean, he 85 00:04:40,800 --> 00:04:42,320 Speaker 1: was pushed on core. 86 00:04:42,120 --> 00:04:46,719 Speaker 4: Inflation twelve months, because he had only focused on headline inflation, 87 00:04:46,880 --> 00:04:49,240 Speaker 4: so the two point one versus two point seven. So 88 00:04:49,320 --> 00:04:51,359 Speaker 4: he got a question, what about the two point seven 89 00:04:51,400 --> 00:04:54,080 Speaker 4: that you haven't mentioned? And then we got into the 90 00:04:54,120 --> 00:04:57,080 Speaker 4: discussion of is it twelve months, is it three months? 91 00:04:57,160 --> 00:05:00,360 Speaker 4: Is it six months? He himself previously I had said, 92 00:05:00,360 --> 00:05:02,680 Speaker 4: look at the twelve month's number. Now we look at 93 00:05:02,680 --> 00:05:05,160 Speaker 4: the three months number six number. Just like we went 94 00:05:05,240 --> 00:05:08,800 Speaker 4: through so many definitions of core and super core. 95 00:05:08,760 --> 00:05:09,560 Speaker 1: And everything else. 96 00:05:10,240 --> 00:05:14,279 Speaker 4: I mean, yes, he added confusion when there's actually little 97 00:05:14,320 --> 00:05:17,000 Speaker 4: need to add confusion right now on that issue. 98 00:05:17,560 --> 00:05:19,440 Speaker 5: So what do you think the FED should be doing 99 00:05:19,839 --> 00:05:21,799 Speaker 5: if ideally if they were going to have a framework, 100 00:05:22,000 --> 00:05:23,840 Speaker 5: or what framework should they follow? And I say this 101 00:05:23,880 --> 00:05:26,280 Speaker 5: as Jim Bianco over at Piancre Research says that right 102 00:05:26,320 --> 00:05:30,040 Speaker 5: now to cut rates again might be worse than transitory. 103 00:05:32,040 --> 00:05:34,640 Speaker 1: So I don't agree with that. I think that we 104 00:05:34,839 --> 00:05:39,719 Speaker 1: are a distance away from what the neutral rate is. 105 00:05:40,920 --> 00:05:46,040 Speaker 4: I think that inflationary expectations are relatively anchored, not at 106 00:05:46,080 --> 00:05:49,160 Speaker 4: two percent. But you know my view that two percent 107 00:05:49,320 --> 00:05:51,960 Speaker 4: is too low, and certainly now is too low an 108 00:05:51,960 --> 00:05:56,080 Speaker 4: inflation target for this economy unless you want to structurally 109 00:05:56,120 --> 00:06:00,640 Speaker 4: weaken it in a significant manner. They should be on 110 00:06:00,680 --> 00:06:05,320 Speaker 4: a path of until we get significant new information on 111 00:06:05,400 --> 00:06:06,240 Speaker 4: what's ahead. 112 00:06:06,400 --> 00:06:09,440 Speaker 1: I'd stress what's ahead, we will. 113 00:06:09,200 --> 00:06:12,559 Speaker 4: Be on a path for now of maintaining a twenty 114 00:06:12,560 --> 00:06:15,960 Speaker 4: five basis points cut and the other thing I have 115 00:06:16,000 --> 00:06:19,080 Speaker 4: stress it is time to get out about this framework. 116 00:06:19,200 --> 00:06:21,440 Speaker 4: They have this mindset they have that they're the only 117 00:06:21,520 --> 00:06:23,880 Speaker 4: game in town. They are not the only game in town. 118 00:06:24,080 --> 00:06:27,960 Speaker 4: They should leave center stage right now and become more 119 00:06:28,200 --> 00:06:31,919 Speaker 4: of an observer and wait to see what plays out. 120 00:06:32,000 --> 00:06:34,560 Speaker 4: But you know, once you are on center stage, you've 121 00:06:34,600 --> 00:06:36,640 Speaker 4: been the only game in town for so long it 122 00:06:36,720 --> 00:06:39,240 Speaker 4: is really difficult to exit stage left. 123 00:06:39,480 --> 00:06:42,479 Speaker 2: So Muhammad, that's your advice to the policy maker. Is 124 00:06:42,480 --> 00:06:45,760 Speaker 2: your advice different to a market participant? Because markets, as 125 00:06:45,800 --> 00:06:49,320 Speaker 2: you know, are anticipatory. The FED you've suggested is overreactionary. 126 00:06:49,800 --> 00:06:51,920 Speaker 2: So I want to understand from your perspective now what 127 00:06:51,960 --> 00:06:55,159 Speaker 2: you would say to a market sticipant whether they should 128 00:06:55,160 --> 00:06:58,280 Speaker 2: be pricing in a big positive growth shop that could 129 00:06:58,320 --> 00:06:59,920 Speaker 2: come with some additional in flight. 130 00:07:01,680 --> 00:07:02,119 Speaker 1: So attend. 131 00:07:02,240 --> 00:07:09,279 Speaker 4: The direction of travel is clear, more growth, slightly higher inflation, 132 00:07:10,520 --> 00:07:15,800 Speaker 4: a higher public sector borrow requirement and a huge sucking 133 00:07:15,880 --> 00:07:19,040 Speaker 4: sound where a lot of phone capital. 134 00:07:18,680 --> 00:07:21,320 Speaker 1: Will end up in the US. That is the direction 135 00:07:21,400 --> 00:07:21,920 Speaker 1: of travel. 136 00:07:23,440 --> 00:07:25,880 Speaker 4: What you've got to figure out, and it's hard, and 137 00:07:25,920 --> 00:07:29,200 Speaker 4: that's why we've got to market is the magnitudes of 138 00:07:29,240 --> 00:07:29,840 Speaker 4: these things. 139 00:07:30,160 --> 00:07:32,400 Speaker 1: But I think John, the direction of travel is clear. 140 00:07:33,200 --> 00:07:36,840 Speaker 4: The magnitudes are going to become clearer as we get 141 00:07:37,760 --> 00:07:41,320 Speaker 4: firm indications not only of what the policy proposals are, 142 00:07:41,600 --> 00:07:43,320 Speaker 4: but who's going to implement these policies. 143 00:07:43,360 --> 00:07:45,960 Speaker 1: The appointments are going to be very important going forward. 144 00:07:46,040 --> 00:07:46,920 Speaker 6: I couldn't agree more. 145 00:07:47,320 --> 00:07:49,040 Speaker 2: Do you think this could be a bigger problem for 146 00:07:49,080 --> 00:07:50,680 Speaker 2: the rest of the world that it will be the 147 00:07:50,800 --> 00:07:51,520 Speaker 2: United States? 148 00:07:52,480 --> 00:07:56,600 Speaker 4: Oh? Absolutely. This is a period in which US dominance 149 00:07:56,800 --> 00:08:00,840 Speaker 4: of the global system is going to increase, both for 150 00:08:01,000 --> 00:08:04,840 Speaker 4: positive reasons and for negative reasons. In the short term, 151 00:08:05,000 --> 00:08:08,880 Speaker 4: the rest of the world simply cannot build enough pipes. 152 00:08:08,960 --> 00:08:09,840 Speaker 1: Around the US. 153 00:08:09,880 --> 00:08:13,000 Speaker 4: They're trying, and they've been doing it, but these pipes 154 00:08:13,040 --> 00:08:15,320 Speaker 4: are very small compared to the size of the US. 155 00:08:15,440 --> 00:08:18,720 Speaker 4: Over the longer term, you will see more pipes being 156 00:08:18,720 --> 00:08:21,000 Speaker 4: built around the US at the core of the system. 157 00:08:21,280 --> 00:08:23,680 Speaker 7: Muhammad the journalist yesterday and the press conference get a 158 00:08:23,800 --> 00:08:26,880 Speaker 7: for effort for trying to get J Powell talk about politics, 159 00:08:26,880 --> 00:08:29,880 Speaker 7: but he wasn't going anywhere near this. Do you actually 160 00:08:29,920 --> 00:08:31,840 Speaker 7: have concerns about the independence of the FED? 161 00:08:33,320 --> 00:08:34,960 Speaker 1: So I would have gone even less. I mean, he 162 00:08:35,000 --> 00:08:36,560 Speaker 1: gave the legal response. 163 00:08:36,600 --> 00:08:40,360 Speaker 4: This was J Pile, J Powell the lawyer, coming out 164 00:08:40,640 --> 00:08:43,360 Speaker 4: in a very strong way. If I had been him, 165 00:08:43,480 --> 00:08:45,720 Speaker 4: I would have simply said, I'm not going to discuss 166 00:08:45,760 --> 00:08:46,240 Speaker 4: this issue. 167 00:08:46,320 --> 00:08:48,280 Speaker 1: I wouldn't have said no. I would have said I. 168 00:08:48,240 --> 00:08:50,240 Speaker 4: Would simply say I would not have discussed this issue. 169 00:08:50,559 --> 00:08:53,920 Speaker 4: Saying no opens up a whole new host of things. 170 00:08:54,320 --> 00:08:57,240 Speaker 7: Do you think saying no was hostile to the former 171 00:08:57,280 --> 00:08:58,840 Speaker 7: president going to be future president? 172 00:09:00,559 --> 00:09:04,320 Speaker 4: I think if it wouldn't surprise me if it's viewed 173 00:09:04,360 --> 00:09:07,200 Speaker 4: as hostile. I think what Chair Power was trying to 174 00:09:07,200 --> 00:09:10,880 Speaker 4: do is give the legal answer. However, it can be 175 00:09:10,920 --> 00:09:12,120 Speaker 4: easily viewed as hostile. 176 00:09:12,200 --> 00:09:16,040 Speaker 5: Yes, based on your view of the US gaining that 177 00:09:16,160 --> 00:09:18,800 Speaker 5: sucking sound of capital away from the rest of the world, 178 00:09:19,280 --> 00:09:21,640 Speaker 5: do you think that sucking sound will also go to 179 00:09:21,720 --> 00:09:23,360 Speaker 5: finance the deficit in a way that. 180 00:09:23,400 --> 00:09:24,640 Speaker 1: Really caps off yields. 181 00:09:24,800 --> 00:09:26,720 Speaker 5: It doesn't really allow them to rise as high as 182 00:09:26,760 --> 00:09:28,600 Speaker 5: some people are threatening such as five percent. 183 00:09:30,040 --> 00:09:32,560 Speaker 4: Yes, I mean so, there's two interpretations of why yields 184 00:09:32,559 --> 00:09:33,040 Speaker 4: came down. 185 00:09:33,760 --> 00:09:35,719 Speaker 1: One is the market has revisited. 186 00:09:36,360 --> 00:09:39,960 Speaker 4: The other, which I favor more, is that US bonds 187 00:09:39,960 --> 00:09:42,720 Speaker 4: relative to the rest of the world became really cheap 188 00:09:43,559 --> 00:09:45,920 Speaker 4: and people reallocated away. 189 00:09:46,000 --> 00:09:46,840 Speaker 1: If you look at what. 190 00:09:46,760 --> 00:09:49,440 Speaker 4: Happened to the differentials visa be the rest of the world, 191 00:09:49,760 --> 00:09:52,800 Speaker 4: US bond in relative space, and most of the time, 192 00:09:52,880 --> 00:09:56,120 Speaker 4: as you know, Lisa, this market solves in relative space 193 00:09:56,120 --> 00:09:59,959 Speaker 4: in the advanced world. It solves more in absolute space 194 00:10:00,240 --> 00:10:03,840 Speaker 4: in emerging markets, but in the advanced world they tend. 195 00:10:03,800 --> 00:10:05,520 Speaker 1: To solve in relative space. 196 00:10:05,559 --> 00:10:10,040 Speaker 4: And relative to other advanced economies, the US yields were looking. 197 00:10:09,920 --> 00:10:11,600 Speaker 1: Very attractive, Muhammed. 198 00:10:11,679 --> 00:10:13,160 Speaker 6: It's wonderful to catch up with you, sir. 199 00:10:13,360 --> 00:10:24,520 Speaker 2: We're lucky to get some time with you. You want 200 00:10:24,520 --> 00:10:26,800 Speaker 2: to get now? Is Ryan Peterson a flex sport right? 201 00:10:26,920 --> 00:10:29,520 Speaker 2: Welcome to the program, sir, let's start with this. How 202 00:10:29,559 --> 00:10:32,800 Speaker 2: busy are you right now? And as business increased a 203 00:10:32,880 --> 00:10:34,560 Speaker 2: ton over the last few weeks. 204 00:10:35,640 --> 00:10:38,400 Speaker 8: Yeah, well, you know, not just necessarily because of the Trump, 205 00:10:38,440 --> 00:10:40,600 Speaker 8: of the possibility of a trumple actually, but we also 206 00:10:40,640 --> 00:10:42,880 Speaker 8: have a looming port strike on the East Coast. Remember 207 00:10:43,080 --> 00:10:47,120 Speaker 8: the Port they went on strike last month, but they 208 00:10:47,160 --> 00:10:50,880 Speaker 8: got a ninety day hiatus and January fifteenth that contract end, 209 00:10:50,960 --> 00:10:53,200 Speaker 8: so that all the East Coast sports right before Trump 210 00:10:53,240 --> 00:10:54,800 Speaker 8: gets elected may go back on striking. So a lot 211 00:10:54,800 --> 00:10:56,920 Speaker 8: of people are trying to get goods in before that 212 00:10:57,040 --> 00:11:00,000 Speaker 8: might happen. So there's always something in global trade. 213 00:11:00,440 --> 00:11:03,520 Speaker 7: Was called union Joe, how do you think the port 214 00:11:03,520 --> 00:11:06,520 Speaker 7: negotiations will go under President elect Trump? 215 00:11:07,400 --> 00:11:08,760 Speaker 3: Yeah, it's a really big question. 216 00:11:08,800 --> 00:11:10,400 Speaker 8: It's sort of like who he listens to, because he 217 00:11:10,520 --> 00:11:13,240 Speaker 8: himself says back in October made statements in favor of 218 00:11:13,240 --> 00:11:15,880 Speaker 8: the union and saying, hey, they need to write to negotiate. 219 00:11:15,440 --> 00:11:18,080 Speaker 1: Against these FOURIGN companies. 220 00:11:19,400 --> 00:11:21,520 Speaker 8: At the same time, his main advisor and how Elon 221 00:11:21,600 --> 00:11:24,800 Speaker 8: Musk has said, well that the union's demands for no 222 00:11:24,880 --> 00:11:28,600 Speaker 8: automation are ridiculous and need to be stopped. So it's 223 00:11:28,640 --> 00:11:30,880 Speaker 8: a really big open question who's Trump going to listen 224 00:11:30,920 --> 00:11:32,560 Speaker 8: to and how does that play out? 225 00:11:32,840 --> 00:11:35,600 Speaker 7: Because of that dynamic, do you think these talks could 226 00:11:35,720 --> 00:11:38,320 Speaker 7: really drag on and how long could we see them 227 00:11:38,360 --> 00:11:39,720 Speaker 7: dragging into twenty twenty five? 228 00:11:40,440 --> 00:11:42,680 Speaker 8: Well, that's one big concern is sort of the talks 229 00:11:42,679 --> 00:11:46,960 Speaker 8: are happening five days before the inauguration, and so is 230 00:11:47,640 --> 00:11:50,559 Speaker 8: you know, what's the current BIDE administration's. 231 00:11:50,040 --> 00:11:52,480 Speaker 3: Role and how committed are they to making that happen. 232 00:11:52,480 --> 00:11:54,400 Speaker 8: And then that's of course with the backdrop of territs WI, 233 00:11:55,000 --> 00:11:57,000 Speaker 8: which we were also alluding to here in your intros. 234 00:11:57,640 --> 00:11:59,679 Speaker 8: Trump's going to want to come in and have that priority. 235 00:11:59,720 --> 00:12:02,280 Speaker 8: But it's very hard to govern when there's always something 236 00:12:02,280 --> 00:12:03,800 Speaker 8: coming at you, right, Ryan. 237 00:12:03,840 --> 00:12:05,600 Speaker 5: Just to zoom out a little bit, there is this 238 00:12:05,720 --> 00:12:08,680 Speaker 5: question you mentioned that things are getting very busy. A 239 00:12:08,720 --> 00:12:11,120 Speaker 5: lot of people are front loading some of their orders 240 00:12:11,160 --> 00:12:14,080 Speaker 5: to get a hoad of both whatever policy changes might come, 241 00:12:14,120 --> 00:12:16,680 Speaker 5: as well as that potential strike. Can you give us 242 00:12:16,720 --> 00:12:19,920 Speaker 5: some sense, some scope of just how much busier it is, 243 00:12:19,960 --> 00:12:22,040 Speaker 5: how much rates are able to go up for you 244 00:12:22,400 --> 00:12:25,240 Speaker 5: as people do try to get ahead of that uncertainty. 245 00:12:26,080 --> 00:12:29,440 Speaker 8: Yeah, I mean, you know you're seeing volumes a little 246 00:12:29,440 --> 00:12:31,439 Speaker 8: bit higher, but it's very hard to attribute to any 247 00:12:31,440 --> 00:12:34,679 Speaker 8: one thing in this It's a very complex, dynamic world. 248 00:12:34,760 --> 00:12:36,760 Speaker 8: So I wouldn't want to say, oh, the volumes are 249 00:12:36,840 --> 00:12:41,000 Speaker 8: up this much because of because of tariffs or because 250 00:12:41,040 --> 00:12:44,280 Speaker 8: of looming changes in policy. So I don't have a 251 00:12:44,320 --> 00:12:47,160 Speaker 8: specific number to tie to it. That said, we've seen 252 00:12:47,200 --> 00:12:50,040 Speaker 8: it every time. Whenever there's new tariffs, you see a 253 00:12:50,040 --> 00:12:52,720 Speaker 8: big surge. You saw it with the BIDA mistration earlier 254 00:12:52,760 --> 00:12:56,120 Speaker 8: this year when they increased three oho one Section three 255 00:12:56,200 --> 00:12:59,839 Speaker 8: oh one tariffs on Chinese steel, for example. That led 256 00:12:59,840 --> 00:13:03,359 Speaker 8: to a big push and ocean freight rates went up about. 257 00:13:03,120 --> 00:13:06,800 Speaker 3: Three x earlier this year. From long run. 258 00:13:06,679 --> 00:13:10,040 Speaker 8: Historical average, it costs about two thousand dollars to ship 259 00:13:10,040 --> 00:13:12,760 Speaker 8: a container from Asia to the US. That went up 260 00:13:12,800 --> 00:13:15,640 Speaker 8: to over six seven thousand dollars in the spot market 261 00:13:15,760 --> 00:13:18,280 Speaker 8: this summer, and it was it was driven by that. 262 00:13:18,360 --> 00:13:19,360 Speaker 3: It was driven by. 263 00:13:19,840 --> 00:13:22,560 Speaker 8: People pulling goods in both before the port strike and 264 00:13:22,720 --> 00:13:24,960 Speaker 8: before the tariffs. So we've seen this movie before, and 265 00:13:25,200 --> 00:13:27,120 Speaker 8: we're probably heading right back into something similar. 266 00:13:27,320 --> 00:13:29,000 Speaker 5: I'd like to lead into this idea that we've seen 267 00:13:29,040 --> 00:13:31,680 Speaker 5: this movie before. We've had the experience of the twenty 268 00:13:32,200 --> 00:13:36,280 Speaker 5: eighteen different tariffs that came to play twenty seventeen, twenty eighteen. 269 00:13:36,480 --> 00:13:39,440 Speaker 5: There's a real question about how much companies have already 270 00:13:39,480 --> 00:13:43,080 Speaker 5: rejiggered their supply chains to adjust to a new reality, 271 00:13:43,120 --> 00:13:46,720 Speaker 5: new pressures, a new focus on near shoring and on shoring. 272 00:13:46,920 --> 00:13:49,800 Speaker 5: How much have you seen a real shift in the 273 00:13:49,880 --> 00:13:52,280 Speaker 5: patterns of your clients in terms of where they ship 274 00:13:52,320 --> 00:13:53,680 Speaker 5: from now. 275 00:13:53,600 --> 00:13:55,840 Speaker 8: It's been massive over the last decade, and not just 276 00:13:55,920 --> 00:13:59,000 Speaker 8: driven by the terriffs, although it's a big factor, but 277 00:13:59,320 --> 00:14:02,679 Speaker 8: also driven by labor costs Chinese. Chinese labor costs have 278 00:14:02,720 --> 00:14:04,760 Speaker 8: gone up, and good for the workers in China, they're 279 00:14:04,760 --> 00:14:07,080 Speaker 8: getting paid more, but they're no longer the low cost 280 00:14:07,160 --> 00:14:09,880 Speaker 8: source of labor for the world, and so companies have 281 00:14:09,880 --> 00:14:12,800 Speaker 8: been relocating that the companies that can have been relocating, 282 00:14:13,240 --> 00:14:16,280 Speaker 8: especially Vietnam, India, Mexico have been sort of like three 283 00:14:16,320 --> 00:14:18,360 Speaker 8: big winners, but many other countries too. 284 00:14:18,840 --> 00:14:22,080 Speaker 1: And that said, there are a lot of supply. 285 00:14:21,880 --> 00:14:25,200 Speaker 8: Chains where you just can't get it done outside of China. 286 00:14:25,240 --> 00:14:31,360 Speaker 8: The manufacturing expertise the ecosystem of component suppliers and for 287 00:14:31,400 --> 00:14:34,280 Speaker 8: that I'm specifically talking about electronics or a few other sectors, 288 00:14:34,280 --> 00:14:36,800 Speaker 8: but really the electronics sector has a real hard time 289 00:14:36,840 --> 00:14:40,560 Speaker 8: moving out of moving manufacturing out of China. And then 290 00:14:40,600 --> 00:14:43,160 Speaker 8: the other big factor, the other big industry here is 291 00:14:43,280 --> 00:14:47,880 Speaker 8: e commerce. Chinese e commerce parcels, so going direct to 292 00:14:47,960 --> 00:14:50,880 Speaker 8: consumer all the way from China are close to fifty 293 00:14:50,920 --> 00:14:54,120 Speaker 8: percent of the world's air freight now, and that is 294 00:14:55,040 --> 00:14:58,640 Speaker 8: already being discussed to shut that down or to impost 295 00:14:58,680 --> 00:15:01,720 Speaker 8: tariffs on it. Remember, those fly duty free under the 296 00:15:01,760 --> 00:15:06,400 Speaker 8: current regulations, and even the Biden administrations and the current 297 00:15:06,480 --> 00:15:10,080 Speaker 8: CBP has a directive Customs and Border Protection excuse me 298 00:15:10,280 --> 00:15:14,040 Speaker 8: as a directive to take away those tariff exemptions that 299 00:15:14,080 --> 00:15:15,640 Speaker 8: may make those non competitive. 300 00:15:16,440 --> 00:15:18,040 Speaker 3: So there's a lot of different. 301 00:15:18,280 --> 00:15:20,480 Speaker 8: Factors here, and I think you'll see an escalation because remember, 302 00:15:20,520 --> 00:15:22,960 Speaker 8: these new tariffs are on top of the ones that 303 00:15:23,000 --> 00:15:26,320 Speaker 8: the Trump and Biden administration put in. They're not It's 304 00:15:26,360 --> 00:15:29,600 Speaker 8: not just like we're back to Trump's tariffs. Biden never 305 00:15:29,600 --> 00:15:32,040 Speaker 8: took them away, and they'll be talking about adding on 306 00:15:32,080 --> 00:15:32,480 Speaker 8: to those. 307 00:15:32,720 --> 00:15:35,920 Speaker 5: You mentioned Vietnam and you mentioned Mexico, and I just wonder, 308 00:15:36,200 --> 00:15:38,360 Speaker 5: especially given some of the threats that we've heard from 309 00:15:38,360 --> 00:15:42,200 Speaker 5: the Trump campaign, how much you see from the flows 310 00:15:42,480 --> 00:15:45,560 Speaker 5: that Mexico is kind of a trojan horse for Chinese 311 00:15:45,600 --> 00:15:48,120 Speaker 5: goods And the same with Vietnam. 312 00:15:49,560 --> 00:15:52,440 Speaker 8: Yeah, in both cases, you've seen exports from China to 313 00:15:52,560 --> 00:15:56,400 Speaker 8: these countries increase by twenty percent over the last two years, 314 00:15:57,120 --> 00:16:00,600 Speaker 8: and so that implies there were either being goods there 315 00:16:00,640 --> 00:16:03,520 Speaker 8: as raw materials into a manufacturing process, or in some 316 00:16:03,600 --> 00:16:06,040 Speaker 8: cases there's probably some fraud where they're just relabeling things 317 00:16:06,080 --> 00:16:08,480 Speaker 8: and saying made in Mexico was actually made in China. 318 00:16:08,560 --> 00:16:11,440 Speaker 8: I think it's probably much more of the former, much 319 00:16:11,480 --> 00:16:14,600 Speaker 8: more of raw materials moving in, and so it's not 320 00:16:14,640 --> 00:16:17,560 Speaker 8: necessarily the market finds a way. You know, it's very 321 00:16:17,560 --> 00:16:20,400 Speaker 8: hard to when when a country like China is so 322 00:16:20,520 --> 00:16:25,040 Speaker 8: good at manufacturing, very hard for businesses to avoid using that. 323 00:16:25,480 --> 00:16:28,000 Speaker 8: They're just going to have a competitive advantage and the 324 00:16:28,400 --> 00:16:31,640 Speaker 8: markets route around it. And the other factor here is 325 00:16:31,640 --> 00:16:35,040 Speaker 8: that it's it's expensive. Trucking is expensive, so moving a 326 00:16:35,040 --> 00:16:39,560 Speaker 8: container or a truckload of cargo from Mexico up to 327 00:16:39,560 --> 00:16:43,000 Speaker 8: the United States is not cheaper than shipping a container 328 00:16:43,000 --> 00:16:45,960 Speaker 8: from Vietnam to the United States. Ocean freight, the physics 329 00:16:45,960 --> 00:16:49,480 Speaker 8: are unmatched, so it's so much cheaper than land freight. 330 00:16:49,600 --> 00:16:53,560 Speaker 8: So it's not necessarily that just because Mexico is closer 331 00:16:53,560 --> 00:16:55,160 Speaker 8: in terms of distance, that it's cheaper. 332 00:16:55,520 --> 00:16:57,560 Speaker 7: There's one sailing rood I wanted to ask you about, 333 00:16:57,680 --> 00:16:59,920 Speaker 7: given we were going to have a change of an 334 00:16:59,840 --> 00:17:03,880 Speaker 7: administration come January, the Red Sea, do you think We're 335 00:17:03,920 --> 00:17:05,720 Speaker 7: going to see more freight go through there. 336 00:17:07,320 --> 00:17:10,760 Speaker 8: We've already started to see a little bit of restoring 337 00:17:10,800 --> 00:17:13,760 Speaker 8: of services through the Red Sea just in the last month. 338 00:17:13,800 --> 00:17:16,600 Speaker 8: And that's before Trump. You know, even anyone had an 339 00:17:16,600 --> 00:17:20,119 Speaker 8: idea that Trump would win. Some carriers are starting to 340 00:17:20,160 --> 00:17:23,879 Speaker 8: brave that. I think there's a real possibility for a breakthrough, 341 00:17:23,920 --> 00:17:26,679 Speaker 8: but I'm not I don't have any insight into, you know, 342 00:17:26,680 --> 00:17:28,960 Speaker 8: what Trump might do with her on or the HOOTI 343 00:17:29,080 --> 00:17:31,360 Speaker 8: rebels there, but I think you should expect a new 344 00:17:31,520 --> 00:17:36,120 Speaker 8: set of initiatives, policies, and potentially potentially military. 345 00:17:35,680 --> 00:17:38,280 Speaker 3: Action, but very unclear. 346 00:17:38,800 --> 00:17:41,600 Speaker 8: One interesting story I thought didn't get enough attention was 347 00:17:41,640 --> 00:17:45,760 Speaker 8: that this allegation that the houtis the rebels in Yemen 348 00:17:45,920 --> 00:17:48,879 Speaker 8: or the really the government in Yemen has been taking 349 00:17:48,960 --> 00:17:52,400 Speaker 8: bribes effectively and running a toll road to the tune 350 00:17:52,400 --> 00:17:55,840 Speaker 8: of two billion dollars a year from ocean carriers and 351 00:17:55,880 --> 00:17:58,720 Speaker 8: ocean shippers to move cargo through and sort of. 352 00:17:58,800 --> 00:18:00,600 Speaker 3: A payoff to not shoot down. 353 00:18:00,640 --> 00:18:03,680 Speaker 8: That's a really crazy development if true, and I like 354 00:18:03,720 --> 00:18:06,080 Speaker 8: to see more about it. I don't have any sources 355 00:18:06,080 --> 00:18:08,160 Speaker 8: on that other than reading it in the news. 356 00:18:08,280 --> 00:18:10,239 Speaker 2: Well, I now a reporter around this table. That's going 357 00:18:10,240 --> 00:18:11,840 Speaker 2: to change that story a little bit more now, Ryan, 358 00:18:11,960 --> 00:18:12,720 Speaker 2: appreciate that. 359 00:18:12,960 --> 00:18:13,240 Speaker 1: Ryan. 360 00:18:13,400 --> 00:18:15,520 Speaker 2: Let's do this again soon. This was super sharp. Really 361 00:18:15,520 --> 00:18:28,040 Speaker 2: appreciate your time, Ryan Peterson. There of flex for Casey 362 00:18:28,040 --> 00:18:30,840 Speaker 2: of signum Global Advice is writing. Broadly speaking, we see 363 00:18:30,840 --> 00:18:36,040 Speaker 2: Trump beginning his second term unrestrained Republican trifecta Supreme Court majority, 364 00:18:36,320 --> 00:18:38,880 Speaker 2: popular mandate. This may be a once in a generation 365 00:18:39,040 --> 00:18:42,440 Speaker 2: chance for Republicans to ennact sweeping change. Rob John just 366 00:18:42,520 --> 00:18:44,680 Speaker 2: now for more, Rob, Good morning morning. Can we start 367 00:18:44,720 --> 00:18:47,200 Speaker 2: with a trifecta you think it gets done? What kind 368 00:18:47,240 --> 00:18:48,320 Speaker 2: of margins are you looking for? 369 00:18:48,840 --> 00:18:51,040 Speaker 9: Really tate margins. I mean it's going to be as 370 00:18:51,359 --> 00:18:53,480 Speaker 9: if not tighter than what we're seeing currently. Of the 371 00:18:53,520 --> 00:18:56,600 Speaker 9: twenty five seats still to be called, I think Republicans 372 00:18:56,720 --> 00:18:59,040 Speaker 9: very easily win or comfortably win nine of them, so 373 00:18:59,040 --> 00:19:01,480 Speaker 9: that gets them to two nineteen, and there. 374 00:19:01,400 --> 00:19:02,840 Speaker 6: Are other sheets Democrats will win in there. 375 00:19:02,880 --> 00:19:05,640 Speaker 9: There are about five or six seats that are absolutely 376 00:19:05,720 --> 00:19:06,280 Speaker 9: toss ups. 377 00:19:06,119 --> 00:19:06,520 Speaker 6: At this point. 378 00:19:06,520 --> 00:19:08,760 Speaker 9: So the best Republicans can hope for, I think is 379 00:19:08,800 --> 00:19:10,439 Speaker 9: two twenty maybe two twenty one. 380 00:19:10,240 --> 00:19:12,080 Speaker 6: But it looks a lot like it does today. 381 00:19:12,280 --> 00:19:15,160 Speaker 7: House majority with Tom Emmer this morning Punchable News says, 382 00:19:15,160 --> 00:19:17,120 Speaker 7: I don't care if it's two eighteen, two nineteen, two twenty. 383 00:19:17,160 --> 00:19:18,440 Speaker 7: I don't give a damn. As long as you have 384 00:19:18,520 --> 00:19:20,560 Speaker 7: the majority, we're going to be successful. But if you 385 00:19:20,560 --> 00:19:23,040 Speaker 7: have two eighteen, basically everyone becomes a king. 386 00:19:23,119 --> 00:19:26,359 Speaker 9: No, yeah, everybody becomes a king. I think it's worse 387 00:19:26,400 --> 00:19:28,960 Speaker 9: for at least Deephonik, who would like to be appointed 388 00:19:28,960 --> 00:19:30,480 Speaker 9: somewhere else, and they don't want to deal with the 389 00:19:30,520 --> 00:19:32,520 Speaker 9: special election in New York at this point that would 390 00:19:32,560 --> 00:19:33,680 Speaker 9: take away their majority. 391 00:19:33,400 --> 00:19:34,360 Speaker 6: If it was that slim. 392 00:19:35,119 --> 00:19:38,080 Speaker 9: But I mean, frankly, Donald Trump is president elect, which 393 00:19:38,119 --> 00:19:39,679 Speaker 9: means in the House, Donald Trump is king. I mean 394 00:19:39,840 --> 00:19:41,439 Speaker 9: they are going to take their shots not from Mike 395 00:19:41,520 --> 00:19:42,800 Speaker 9: Johnson or anybody else. 396 00:19:43,200 --> 00:19:44,320 Speaker 6: They're going to take them from Trump. 397 00:19:44,440 --> 00:19:46,280 Speaker 7: So besides at least Stefan and who may go over 398 00:19:46,359 --> 00:19:49,280 Speaker 7: to the UN, what does the leadership look like in 399 00:19:49,280 --> 00:19:49,679 Speaker 7: the House. 400 00:19:50,119 --> 00:19:53,040 Speaker 9: I think it's Speaker Johnson. I think it's Speaker Johnson 401 00:19:53,080 --> 00:19:54,240 Speaker 9: will stay in his seat. 402 00:19:54,400 --> 00:19:55,240 Speaker 1: He did what he had to do. 403 00:19:55,280 --> 00:19:58,119 Speaker 9: I mean, he retains the Republican majority very likely at 404 00:19:58,119 --> 00:20:02,000 Speaker 9: this point. And you know, other than that, I frankly 405 00:20:02,040 --> 00:20:04,159 Speaker 9: don't think it matters very much because I think this 406 00:20:04,200 --> 00:20:07,320 Speaker 9: will be a session which legislation is done top ten. 407 00:20:07,760 --> 00:20:09,240 Speaker 6: It'll come from Trump, It'll come from. 408 00:20:09,119 --> 00:20:11,440 Speaker 9: The White House, and the Senate very likely to fall 409 00:20:11,440 --> 00:20:13,119 Speaker 9: online the House probably even more so. 410 00:20:13,119 --> 00:20:13,199 Speaker 3: So. 411 00:20:13,240 --> 00:20:14,479 Speaker 7: What's the first order of business? 412 00:20:14,520 --> 00:20:15,640 Speaker 6: The border or taxes? 413 00:20:15,880 --> 00:20:18,080 Speaker 9: I think it's the border. I think it's oil and gas, 414 00:20:18,080 --> 00:20:20,560 Speaker 9: both through executive action. I think taxes will take a 415 00:20:20,600 --> 00:20:23,080 Speaker 9: little bit longer because we will see I mean, it's 416 00:20:23,080 --> 00:20:26,159 Speaker 9: not a budget negotiation between Republicans and Democrats. It'll be 417 00:20:26,200 --> 00:20:30,320 Speaker 9: a budget negotiation between the center and the right of Republicans, 418 00:20:30,600 --> 00:20:32,320 Speaker 9: and we'll see that done through budget reconciliation. 419 00:20:32,359 --> 00:20:33,320 Speaker 6: That'll take a number of months. 420 00:20:33,600 --> 00:20:35,879 Speaker 5: Will what will the immigration proposal look like? Is it 421 00:20:35,920 --> 00:20:37,240 Speaker 5: going to be mass deportations. 422 00:20:37,920 --> 00:20:40,160 Speaker 9: I think we will hear about mass deportations. I think 423 00:20:40,160 --> 00:20:42,439 Speaker 9: it's very unlikely we'll see that in the short term, frankly, 424 00:20:42,440 --> 00:20:45,359 Speaker 9: because it just requires so many billions and billions of 425 00:20:45,359 --> 00:20:48,160 Speaker 9: dollars to do that. There isn't an obvious path forward 426 00:20:48,200 --> 00:20:51,440 Speaker 9: for mass deportations. I think very likely what we see 427 00:20:51,520 --> 00:20:55,600 Speaker 9: is targeted deportations of illegal immigrants who have committed crimes 428 00:20:55,600 --> 00:21:00,000 Speaker 9: on US soil. Will get pictures and videos of immigrant 429 00:21:00,440 --> 00:21:02,800 Speaker 9: being taken across the border and buses, and we're very 430 00:21:02,840 --> 00:21:04,919 Speaker 9: likely to see remain in Mexico reinstated. 431 00:21:04,920 --> 00:21:07,240 Speaker 6: But deporting tens of millions of. 432 00:21:07,800 --> 00:21:10,560 Speaker 9: Illegal immigrants really really hard to do without additional funding 433 00:21:10,600 --> 00:21:12,200 Speaker 9: from Congress, which would take a lot longer. 434 00:21:12,240 --> 00:21:14,160 Speaker 5: You know, one of the most interesting conversations that we've had, 435 00:21:14,240 --> 00:21:16,879 Speaker 5: I thought was Representative french Hill yesterday, where we were 436 00:21:16,920 --> 00:21:19,800 Speaker 5: talking about the budget deficit and his concern about it. 437 00:21:19,840 --> 00:21:22,000 Speaker 5: And he is a Republican, he is a House member, 438 00:21:22,040 --> 00:21:24,240 Speaker 5: he is a supporter of Trump, and he poured a 439 00:21:24,240 --> 00:21:26,320 Speaker 5: lot of cold water over some of the proposals that 440 00:21:26,359 --> 00:21:28,639 Speaker 5: we heard from Elon Musk and the feasibility of cutting 441 00:21:28,640 --> 00:21:31,480 Speaker 5: two trillion dollars of the budget so easily. So how 442 00:21:31,600 --> 00:21:35,040 Speaker 5: much pushback will there be within even the Republican Party 443 00:21:35,320 --> 00:21:37,679 Speaker 5: as far as expanding the deficit to the degree that 444 00:21:37,760 --> 00:21:39,439 Speaker 5: some people project that the plans would do. 445 00:21:40,000 --> 00:21:41,680 Speaker 9: I think there will be some pushback, but I think 446 00:21:41,720 --> 00:21:44,000 Speaker 9: almost necessarily we will see an extension of the Trump 447 00:21:44,040 --> 00:21:46,080 Speaker 9: tax cuts, all of them, not just some of them. 448 00:21:46,480 --> 00:21:48,919 Speaker 9: And you know, there really isn't any obvious spending to 449 00:21:49,160 --> 00:21:54,040 Speaker 9: commensurate with that level of tax cuts. So otherwise, put, 450 00:21:54,080 --> 00:21:56,000 Speaker 9: I think we are going to see an expansion of 451 00:21:56,040 --> 00:21:57,399 Speaker 9: the deficit almost necessarily. 452 00:21:57,520 --> 00:21:59,560 Speaker 2: So work through the kind of policies that run the 453 00:21:59,560 --> 00:22:01,439 Speaker 2: campaign that you think could get done. 454 00:22:01,800 --> 00:22:05,960 Speaker 6: No tanks, he's on tips that happens. Probably not. You 455 00:22:06,000 --> 00:22:07,000 Speaker 6: don't think that happens. 456 00:22:07,160 --> 00:22:07,320 Speaker 3: Well. 457 00:22:08,080 --> 00:22:09,720 Speaker 9: I think over the past six months, what we've seen 458 00:22:09,800 --> 00:22:12,960 Speaker 9: is Donald Trump run frankly, a phenomenal campaign. Of course 459 00:22:13,240 --> 00:22:15,920 Speaker 9: today we know it was a winning campaign. I think 460 00:22:15,920 --> 00:22:18,000 Speaker 9: a lot of what he was discussing, does he want 461 00:22:18,040 --> 00:22:18,680 Speaker 9: to get it done? 462 00:22:18,840 --> 00:22:19,280 Speaker 6: Maybe? 463 00:22:19,320 --> 00:22:21,600 Speaker 9: Are they priorities to get done in this first one 464 00:22:21,680 --> 00:22:24,440 Speaker 9: hundred two hundred days where we'll see a bulk of 465 00:22:24,480 --> 00:22:25,560 Speaker 9: the legislation get done. 466 00:22:25,640 --> 00:22:26,399 Speaker 6: I think probably not. 467 00:22:26,600 --> 00:22:29,040 Speaker 2: So that's one policy copor tank's write down to fifteen 468 00:22:29,080 --> 00:22:30,119 Speaker 2: percent with conditions? 469 00:22:30,280 --> 00:22:30,880 Speaker 6: What about that? 470 00:22:31,000 --> 00:22:31,200 Speaker 3: Yeah? 471 00:22:31,200 --> 00:22:31,560 Speaker 6: I think so. 472 00:22:31,880 --> 00:22:35,439 Speaker 9: I mean again, the campaign talked about twenty percent, eighteen percent. 473 00:22:35,880 --> 00:22:38,080 Speaker 9: I think those were campaign poys because frankly, a corporate 474 00:22:38,160 --> 00:22:41,520 Speaker 9: rate cut doesn't play very well among working the working class. 475 00:22:42,040 --> 00:22:44,040 Speaker 9: I think Republicans are going to do all that they 476 00:22:44,040 --> 00:22:45,359 Speaker 9: can to get it down to fifteen percent. 477 00:22:45,480 --> 00:22:48,200 Speaker 7: Let's talk about inside the White House. Josey Wiles was 478 00:22:48,200 --> 00:22:50,479 Speaker 7: announced last night, Trump calls her his ice baby. Who 479 00:22:50,520 --> 00:22:52,119 Speaker 7: else do you expect to join the cabinet? 480 00:22:52,640 --> 00:22:53,840 Speaker 6: We see Rick Cornell at State. 481 00:22:53,920 --> 00:22:56,840 Speaker 9: If it's not Rick Cornell, it'll probably be from the Senate, 482 00:22:56,880 --> 00:22:59,920 Speaker 9: maybe Rubio. It could also be Bob O Brian. But but 483 00:22:59,720 --> 00:23:02,040 Speaker 9: I would I would tap at Grenell at this point. 484 00:23:02,400 --> 00:23:04,560 Speaker 9: You know, we're all asking ourselves who Treasury is going 485 00:23:04,600 --> 00:23:07,280 Speaker 9: to be. It's Scott Best and I think is at 486 00:23:07,280 --> 00:23:09,800 Speaker 9: the top of the list. But Howard Lutnek has I 487 00:23:09,840 --> 00:23:12,760 Speaker 9: think become more popular in the campaign and transition teams 488 00:23:12,960 --> 00:23:15,399 Speaker 9: over the course of the past week or month. So 489 00:23:15,400 --> 00:23:16,840 Speaker 9: I would look at Howard Levenink as well. 490 00:23:16,920 --> 00:23:20,240 Speaker 7: What do these names swirling around the potential cabinet picks 491 00:23:20,480 --> 00:23:23,359 Speaker 7: for President Trump tell you about where his mind is 492 00:23:23,400 --> 00:23:26,119 Speaker 7: and how maybe the next four years will play out. 493 00:23:26,280 --> 00:23:28,560 Speaker 9: Well, I think that the Trump two point oh team 494 00:23:28,600 --> 00:23:30,439 Speaker 9: will be more ready to govern than the Trump one 495 00:23:30,480 --> 00:23:32,119 Speaker 9: point oh team was. I mean, we have to remember 496 00:23:32,119 --> 00:23:33,919 Speaker 9: that in Trump one point zero we also had a 497 00:23:33,920 --> 00:23:38,320 Speaker 9: Republican trifecta. There was not a lot of major legislation 498 00:23:38,359 --> 00:23:41,119 Speaker 9: that got done in that period before the midterms. I 499 00:23:41,119 --> 00:23:44,879 Speaker 9: think we will see a different Trump administration with a 500 00:23:44,880 --> 00:23:48,200 Speaker 9: lot more momentum, a lot more efficient whether without Elon Musk, 501 00:23:48,240 --> 00:23:52,919 Speaker 9: you know, really running the efficiency efficiency show. So what 502 00:23:52,920 --> 00:23:56,119 Speaker 9: I think we're going to see is it's a technocratic cabinet, 503 00:23:56,560 --> 00:23:58,679 Speaker 9: but it's also a cabinet very very willing to implement 504 00:23:58,760 --> 00:23:59,600 Speaker 9: Trump's policies. 505 00:23:59,680 --> 00:24:03,280 Speaker 5: You say technocratic cabinet. Yesterday Donald Trump came out with 506 00:24:03,560 --> 00:24:05,280 Speaker 5: the plan to eradicate deep state. 507 00:24:05,560 --> 00:24:06,520 Speaker 6: It started talking. 508 00:24:06,320 --> 00:24:08,879 Speaker 5: About a series of measures to give him the ability 509 00:24:08,960 --> 00:24:12,320 Speaker 5: to remove certain people, certain bureaucrass as he calls them, 510 00:24:12,320 --> 00:24:16,239 Speaker 5: different members of the government. How much are those some 511 00:24:16,280 --> 00:24:18,000 Speaker 5: of the things that we can expect to hear versus 512 00:24:18,040 --> 00:24:20,360 Speaker 5: the technocratic aspects that you're talking about. 513 00:24:20,520 --> 00:24:23,280 Speaker 9: Well, I think at a very high level, top level 514 00:24:23,280 --> 00:24:25,879 Speaker 9: cabinet positions, these people are really smart. These people have 515 00:24:25,920 --> 00:24:27,600 Speaker 9: their hands in policy, and they're going to be ready 516 00:24:27,640 --> 00:24:31,440 Speaker 9: to go underneath that. So some of the more professional 517 00:24:31,960 --> 00:24:35,320 Speaker 9: but still policy related jobs, Trump wants to ensure that 518 00:24:35,359 --> 00:24:38,600 Speaker 9: those people are pursuing his agenda and not their own. 519 00:24:39,200 --> 00:24:40,919 Speaker 9: The easiest way for him to do that is to 520 00:24:41,000 --> 00:24:44,160 Speaker 9: enact something called Section FI, which could allow for him 521 00:24:44,160 --> 00:24:47,800 Speaker 9: to fire up to fifty thousand policy level positions subcabinet 522 00:24:48,680 --> 00:24:50,359 Speaker 9: do we think he's going to fire fifty thousand people, 523 00:24:50,359 --> 00:24:53,119 Speaker 9: you know, on January twentieth, twenty. First, no, do I 524 00:24:53,119 --> 00:24:55,440 Speaker 9: think that that's a helpful threat for Trump to ensure 525 00:24:55,480 --> 00:24:57,640 Speaker 9: that the people working under him and under his cabinet 526 00:24:57,840 --> 00:24:59,760 Speaker 9: are pushing the ball forward. 527 00:25:00,040 --> 00:25:01,520 Speaker 6: I think it is helpful. So I think we hear 528 00:25:01,560 --> 00:25:01,960 Speaker 6: a lot more. 529 00:25:01,920 --> 00:25:03,960 Speaker 5: About Session f The reason why I ask this is 530 00:25:04,000 --> 00:25:06,479 Speaker 5: because when you say ready to govern, that could mean 531 00:25:06,520 --> 00:25:08,640 Speaker 5: a lot of different things. Is it pushing through legislation, 532 00:25:08,760 --> 00:25:11,920 Speaker 5: is it looking for the types of provisions that could 533 00:25:11,920 --> 00:25:16,800 Speaker 5: allow some of these more dramatic provisions to go into effect. 534 00:25:17,119 --> 00:25:17,720 Speaker 6: Which is it? 535 00:25:18,640 --> 00:25:20,920 Speaker 9: Well, I think first it's it will be done by 536 00:25:21,000 --> 00:25:23,840 Speaker 9: executive action. And again I think that the two opportunities 537 00:25:23,880 --> 00:25:25,639 Speaker 9: for him to do that on the border, not so 538 00:25:25,720 --> 00:25:30,680 Speaker 9: much major immigration reform, but border enforcement in particular. And 539 00:25:31,080 --> 00:25:32,919 Speaker 9: I do think very quickly we will see that. You know, 540 00:25:33,200 --> 00:25:36,240 Speaker 9: Trump returned to the drill baby, drill talking points opening 541 00:25:36,320 --> 00:25:39,040 Speaker 9: up federal land for more oil. 542 00:25:38,840 --> 00:25:39,520 Speaker 6: And gas production. 543 00:25:39,680 --> 00:25:40,879 Speaker 9: Whether or not we see them in the market in 544 00:25:40,880 --> 00:25:42,879 Speaker 9: the short term, I'm skeptical, but it is what it is. 545 00:25:43,880 --> 00:25:47,200 Speaker 9: The second, on the legislative front, I think it will 546 00:25:47,200 --> 00:25:49,520 Speaker 9: be tax focused. I think everything else sort of in 547 00:25:49,560 --> 00:25:52,080 Speaker 9: the first one hundred days probably falls to the wayside. 548 00:25:52,280 --> 00:25:54,600 Speaker 2: Up it's going to see. As always said, thank you Rupkese. 549 00:25:54,960 --> 00:25:59,480 Speaker 2: As Saganum Global advises. 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