WEBVTT - Inauguration Day Special Part 2 0:00:02.520 --> 0:00:10.520 Bloomberg Audio Studios, Podcasts, radio news. This is Bloomberg business Week, 0:00:10.800 --> 0:00:14.080 Insight from the reporters and editors that bring you America's 0:00:14.080 --> 0:00:19.080 most trusted business magazine, plus global business, finance and tech news. 0:00:19.440 --> 0:00:24.160 The Bloomberg Business Week Podcast with Carol Masser and Tim Stenebeck. 0:00:24.520 --> 0:00:26.160 On Bloomberg Radio. 0:00:27.000 --> 0:00:29.200 We have Monica Guerra here in studio with US policy 0:00:29.200 --> 0:00:31.040 analyst at Morgan Stanley, and so as we listen to 0:00:31.040 --> 0:00:32.920 this music in the back, we'll keep it going just 0:00:32.960 --> 0:00:34.960 for some flavor and feel as we go for Monica. 0:00:35.000 --> 0:00:36.600 Great to have you with us. And I'm kind of 0:00:36.600 --> 0:00:40.360 curious how you, as someone who is following this from 0:00:40.440 --> 0:00:43.200 an investor perspectives or processed what we've seen so far 0:00:43.240 --> 0:00:45.960 in the first speech, the formal inaugural address, in the 0:00:46.040 --> 0:00:48.519 kind of second more loose inaugural address that we got 0:00:48.520 --> 0:00:51.479 after that, what's it telling you about how the policies 0:00:51.520 --> 0:00:52.880 of this president are going to be going to be 0:00:53.000 --> 0:00:53.400 rolled out? 0:00:53.800 --> 0:00:55.720 Yeah, I think at first, if you're looking at the 0:00:55.760 --> 0:00:59.280 executive orders, right, he essentially went through his top line 0:00:59.320 --> 0:01:05.120 items immigration, right, immigrate, some strict immigration reforms, and that 0:01:05.160 --> 0:01:08.400 could have a longer term impact on the economy. So 0:01:08.840 --> 0:01:10.760 day one we have to see exactly what that looks like, 0:01:10.800 --> 0:01:12.120 how is it going to take shape, how are they 0:01:12.160 --> 0:01:14.360 going to implement. So one of the things we spend 0:01:14.360 --> 0:01:16.399 a lot of time thinking about and talking about is 0:01:16.800 --> 0:01:20.560 not just the magnitude of the policies, but the pacing 0:01:20.560 --> 0:01:24.160 and sequencing. So if you're just focusing day one on immigration, 0:01:24.600 --> 0:01:26.640 you have to consider that that has the more of 0:01:26.640 --> 0:01:29.920 a five year lag to truly having a pull on 0:01:29.959 --> 0:01:34.280 the economy because you're looking at demographics, fertility rates going down, 0:01:34.319 --> 0:01:37.000 et cetera over time, and so that is a more 0:01:37.040 --> 0:01:40.160 gradual impact. Now, if you're looking at some of his 0:01:40.560 --> 0:01:44.880 more economically stimulative policies that are deregulatory, et cetera, that 0:01:44.920 --> 0:01:48.840 could have a more and a more immediate implication. 0:01:49.080 --> 0:01:51.560 Well, would there be would it be possible to have 0:01:52.000 --> 0:01:55.800 more of an economic shock from immigration policy, whereas the 0:01:55.800 --> 0:01:58.400 effects would not be lagged If indeed he does follow 0:01:58.440 --> 0:02:02.800 through with essentially deporting you know, up to eleven million 0:02:02.800 --> 0:02:03.360 people from. 0:02:03.240 --> 0:02:07.400 This country, That again is a very large number. So 0:02:07.760 --> 0:02:10.280 are you saying magnitude in pacing if it is at 0:02:10.280 --> 0:02:11.840 that magnitude, yes, of. 0:02:11.800 --> 0:02:14.000 Course, is it realistic for us to think about it 0:02:14.040 --> 0:02:16.440 at that magnitude just because of logistical reasons. 0:02:16.880 --> 0:02:21.240 That's essentially where my position today stands. Obviously, if you're 0:02:21.280 --> 0:02:24.360 going to engage the military and have other tactics that 0:02:24.400 --> 0:02:26.400 could change the perception, and I think a lot of 0:02:26.520 --> 0:02:28.800 us here are involved in the waiting game. But if 0:02:28.840 --> 0:02:31.600 you're looking at the five hundred thousand folks who are 0:02:31.680 --> 0:02:35.720 in the criminal justice system already that would be easily deported, 0:02:36.080 --> 0:02:38.800 that's about net two hundred thousand more than the annual 0:02:38.800 --> 0:02:41.040 three hundred thousand that are deported. So that has a 0:02:41.120 --> 0:02:44.040 very different impact. Now, if you're going for that eleven million, 0:02:44.560 --> 0:02:47.840 I find that, you know, it's be a quite you know, 0:02:47.880 --> 0:02:52.400 a large number that would be difficult to quantify in 0:02:52.440 --> 0:02:55.680 a very swift period of time. You could get a 0:02:55.720 --> 0:02:58.679 significant shock. Obviously, the industries that are going to be 0:02:58.720 --> 0:03:00.640 impacted the most. So if you get above that five 0:03:00.760 --> 0:03:03.440 hundred thousand number and you're starting to deport folks who 0:03:03.440 --> 0:03:05.880 are not in the criminal justice system and are already 0:03:05.960 --> 0:03:09.360 not participating in the economy and in labor, it's going 0:03:09.400 --> 0:03:13.120 to be agriculture, services, industry, etc. So we have to 0:03:13.400 --> 0:03:17.520 focus on those areas, especially as investors, as the policies 0:03:17.560 --> 0:03:18.840 actually roll out, all right. 0:03:18.880 --> 0:03:21.200 We also want to bring into the conversation Jennifer Lawless. 0:03:21.200 --> 0:03:23.440 She is Professor of Politics and Public Policy at the 0:03:23.520 --> 0:03:26.720 University of Virginia, Professor at Lawas you've been listening to 0:03:26.760 --> 0:03:30.440 our conversation, are you getting a better feeling of the 0:03:30.480 --> 0:03:36.080 prioritization of policy within the Trump administration by the president 0:03:36.200 --> 0:03:38.320 of the things that we need to kind of keep 0:03:38.560 --> 0:03:40.520 a watch on that you think he initially is going 0:03:40.560 --> 0:03:42.320 to tackle. Is it clear to you yet? 0:03:43.640 --> 0:03:46.600 It seems like this speech today, both the formal speech 0:03:46.640 --> 0:03:49.000 and the informal one, and everything that we've heard since 0:03:49.000 --> 0:03:52.920 the election, is consistent with the campaign trial priorities. So 0:03:53.040 --> 0:03:55.760 immigration will be one of the first things that are tackled, 0:03:56.240 --> 0:03:59.040 Tariffs and how that's going to affect the economy will 0:03:59.040 --> 0:04:01.600 be the second, and on the back burner will be 0:04:01.680 --> 0:04:05.400 things like abortion, where he's ready to act should Congress 0:04:05.440 --> 0:04:08.040 manage to pass that kind of ban. We also saw 0:04:08.240 --> 0:04:11.360 during the speech today that there are symbolic things that 0:04:11.400 --> 0:04:14.320 he's going to be doing to speak to his base 0:04:14.440 --> 0:04:16.880 and to try and demonstrate that he's going to filfil 0:04:16.960 --> 0:04:20.640 campaign promises. So it's very unheard of in an inauguration address, 0:04:20.680 --> 0:04:24.360 for example, to state that gender is binary, and so 0:04:24.480 --> 0:04:26.160 things like that are going to be the kinds of 0:04:26.200 --> 0:04:27.640 things we're going to hear over the course of the 0:04:27.640 --> 0:04:28.240 next few weeks. 0:04:28.279 --> 0:04:29.280 I would assume. 0:04:29.040 --> 0:04:32.080 Jennifer help us out here navigating all of that, because 0:04:32.120 --> 0:04:33.839 I think that's going to be the thorniest part of 0:04:33.839 --> 0:04:35.800 this and the challenge at least in these coming days, 0:04:36.839 --> 0:04:40.119 how you decide what is symbolic and what has teeth, 0:04:40.360 --> 0:04:42.440 what's going to be something that you would be tantamount 0:04:42.480 --> 0:04:44.440 to to a major policy change. How are you going 0:04:44.480 --> 0:04:46.920 to navigate that as we kind of look at the 0:04:46.960 --> 0:04:51.200 rhetoric at these executive orders, at maybe more formal speeches 0:04:51.200 --> 0:04:53.760 and addresses from the president, how do you process all 0:04:53.800 --> 0:04:54.080 of that. 0:04:55.680 --> 0:04:59.200 Well, it's symbolic if Congress ultimately has to act in 0:04:59.279 --> 0:05:02.839 order to change policy and hasn't done that yet, And 0:05:02.920 --> 0:05:05.440 so Donald Trump can say, for example, that we're going 0:05:05.480 --> 0:05:08.520 to become a country again where there are only two genders, 0:05:08.800 --> 0:05:11.120 but it's hard to know what that actually means except 0:05:11.160 --> 0:05:14.400 alienating and isolating large portions of the population. We do 0:05:14.480 --> 0:05:16.799 know that it means that, and there are real ramifications, 0:05:17.120 --> 0:05:20.239 but in terms of policy at this point, his rhetoric 0:05:20.360 --> 0:05:23.479 doesn't change the way that states conduct the business they've 0:05:23.480 --> 0:05:26.920 been conducting when it comes to immigration, where the federal 0:05:26.960 --> 0:05:29.960 government does play a clear and active role, and Donald 0:05:29.960 --> 0:05:33.479 Trump or any president through executive order can shape policy 0:05:33.720 --> 0:05:35.520 that's certainly going to be more than symbolic. 0:05:35.640 --> 0:05:37.200 Can I just say, I'm thinking about all of the 0:05:37.360 --> 0:05:40.680 HR teams in you know, global corporations or Corporate America 0:05:40.720 --> 0:05:42.480 who are like saying, okay, and how do we address 0:05:42.520 --> 0:05:45.800 this with our employee base in terms of you know, 0:05:45.920 --> 0:05:48.120 just two genders and you know, I'm assuming they're going 0:05:48.160 --> 0:05:49.960 to have to be addressing this. It's just something that 0:05:50.000 --> 0:05:50.560 I'm curious. 0:05:50.720 --> 0:05:51.039 I don't know. 0:05:51.160 --> 0:05:52.120 We'll see how. 0:05:51.960 --> 0:05:53.960 This will play out over the next over this week. 0:05:54.279 --> 0:05:57.320 I don't know if that it matters for companies. This 0:05:57.440 --> 0:05:59.320 might be something. My understanding is this is like the 0:05:59.360 --> 0:06:03.680 federal government and it's passports. It you know, a company 0:06:03.720 --> 0:06:05.840 can do whatever. I think a company can do whatever 0:06:05.920 --> 0:06:06.320 it wants. 0:06:06.360 --> 0:06:06.719 I don't know. 0:06:06.880 --> 0:06:08.599 I guess so, I guess so, I don't know. Like 0:06:08.920 --> 0:06:11.559 I'm curious, you know, Monica, like for your company, Morgan 0:06:11.640 --> 0:06:14.039 Stanley and some of these issues that are coming down, 0:06:14.120 --> 0:06:16.839 I don't mean to put you in the hot seat, 0:06:17.040 --> 0:06:19.919 but I do think about these issues will have to 0:06:19.960 --> 0:06:22.320 be addressed by companies. 0:06:22.200 --> 0:06:24.480 And you know, it is something that Morgan Stanley has 0:06:24.480 --> 0:06:26.679 to deal with on a daily basis. I can't speak 0:06:26.720 --> 0:06:28.600 on behalf of them. I'm not on our legal team. 0:06:28.600 --> 0:06:30.080 That's not an area, right that I. 0:06:30.120 --> 0:06:32.240 Focus on policies in general, right. 0:06:32.080 --> 0:06:34.240 Policies in general, right, I keep an eye on all 0:06:34.240 --> 0:06:36.360 of that. I sometimes have conversations about what we think 0:06:36.440 --> 0:06:40.360 the administration might do. That said, when I'm thinking about messaging, 0:06:40.400 --> 0:06:44.080 I think another sort of pivoting away from the di discussion. 0:06:44.279 --> 0:06:47.040 I want to focus on Tariff's brow just to move 0:06:47.120 --> 0:06:55.480 move the conversation. Definitely done now happy, No with tariffs. 0:06:55.720 --> 0:06:58.159 I think it's important to note that we got a 0:06:58.200 --> 0:07:00.200 lot of really big messaging. And that's why I like 0:07:00.240 --> 0:07:02.880 with the immigration comment, right with the eleven million number, 0:07:02.960 --> 0:07:05.599 I really want to highlight that. With tariff, say came in, 0:07:05.720 --> 0:07:07.440 they were saying they were going to do all of 0:07:07.480 --> 0:07:10.160 this significant action on day one. Now now they're going 0:07:10.200 --> 0:07:12.200 to do a study. So that's why we have to 0:07:12.600 --> 0:07:14.960 see things as they come out, right, you have to 0:07:15.000 --> 0:07:17.040 see the action's actions speak louder than words. 0:07:17.080 --> 0:07:18.520 But when your kid comes to you, I want this toy. 0:07:18.560 --> 0:07:20.160 I want this toy. Right, let me think about it, 0:07:20.200 --> 0:07:21.160 and so we're going to study it. 0:07:21.400 --> 0:07:24.440 So that's important right when we're when we're trying to 0:07:24.480 --> 0:07:27.360 suss through what this means for markets and the economy. Now, 0:07:27.360 --> 0:07:29.480 one of the things that we're really focused on and 0:07:29.520 --> 0:07:32.280 trying to hedge for is, you know, is all that 0:07:32.400 --> 0:07:36.200 enthusiasm around Trump priced in? Is this an opportunity right 0:07:36.240 --> 0:07:38.800 for Trump to disappoint if he doesn't go big on 0:07:38.800 --> 0:07:42.239 on I would say corporate tax cuts, for example, that's 0:07:42.560 --> 0:07:46.360 a really era I would say important area where investors 0:07:46.360 --> 0:07:49.040 are focusing on. They're expecting a cut as deep as 0:07:49.040 --> 0:07:53.240 fifteen percent, But when you're thinking about the broader fiscal system, 0:07:53.640 --> 0:07:56.320 it's important to take into account what they can and 0:07:56.360 --> 0:07:59.280 cannot achieve and if they're trying to offset debt and deficits, 0:07:59.280 --> 0:08:01.880 if they're trying to find and cost savings, cutting a 0:08:01.920 --> 0:08:04.440 corporate tax may not be the first thing on the agenda. 0:08:04.560 --> 0:08:06.760 So if that is not delivered on, do we see 0:08:06.800 --> 0:08:11.640 equity markets and the stock of companies react in a way. 0:08:11.400 --> 0:08:13.040 That is negative? 0:08:13.280 --> 0:08:17.200 Yeah, I say you would see multiples right, have a correction. 0:08:17.760 --> 0:08:20.320 I can't speak to you know how long that would last. 0:08:20.440 --> 0:08:22.240 I don't know what the messaging around. 0:08:22.200 --> 0:08:23.480 In your view is, it is what's. 0:08:23.320 --> 0:08:27.600 Pricing is the fifteen percent. Is the enthusiasm right around 0:08:27.600 --> 0:08:31.920 this pro growth, incredibly pro growth messaging. And so when 0:08:31.920 --> 0:08:35.320 I'm thinking through where are the risks and opportunity sets, 0:08:35.640 --> 0:08:37.880 one of the risks that I'm focused on is the 0:08:37.880 --> 0:08:38.839 corporate tax cut. 0:08:39.400 --> 0:08:41.040 Jennifer Lawless, I want to bring you back in here. 0:08:41.040 --> 0:08:42.880 We were talking a little while ago just about how 0:08:42.880 --> 0:08:46.560 this presence sees himself in the context of history, and 0:08:46.600 --> 0:08:48.480 I'm curious what stood out to you about the remarks 0:08:48.480 --> 0:08:50.280 he made. And I think that that second speech he 0:08:50.320 --> 0:08:52.920 gave with so illuminating in that regard that there's still 0:08:52.920 --> 0:08:55.319 a lot of things that he's clearly ticked off about 0:08:55.320 --> 0:08:58.760 that happened last time around. You know, when we talk 0:08:58.800 --> 0:09:02.120 about of his desires on Greenland and Panama and the like, 0:09:02.160 --> 0:09:05.000 that there's a sense to kind of put a stamp 0:09:05.040 --> 0:09:10.040 on this presidency in a very big and novel expansionary way. 0:09:10.679 --> 0:09:12.080 Talk about that if you would just sort of what 0:09:12.160 --> 0:09:15.000 you observed about the sort of way he sees himself 0:09:15.040 --> 0:09:17.240 in the larger context of American history visa VI that 0:09:17.280 --> 0:09:19.240 that speech that he gave this afternoon. 0:09:20.440 --> 0:09:23.360 It seems to me that Donald Trump does not differentiate 0:09:23.640 --> 0:09:27.959 between being president and the institution of the presidency. Typically, 0:09:28.040 --> 0:09:31.079 what happens is that presidents feel like they're moving into 0:09:31.120 --> 0:09:34.240 a role. They talk about the importance of democracy and 0:09:34.280 --> 0:09:36.840 a smooth transition of power. They talk about the august 0:09:37.040 --> 0:09:40.360 nature of the institution that they'll be occupying, and they 0:09:40.400 --> 0:09:44.720 talk about the importance of bringing the country together and moving. 0:09:44.440 --> 0:09:45.920 Forward to achieve greatness. 0:09:46.120 --> 0:09:48.640 Donald Trump did not do that in twenty seventeen, and 0:09:48.720 --> 0:09:51.520 he did not do that today. In fact, today's speech 0:09:51.559 --> 0:09:53.520 in a lot of ways was even more negative and 0:09:53.559 --> 0:09:56.839 even darker than his first inaugural because it was also 0:09:56.920 --> 0:10:00.840 filled with attitude, an attitude that highlights the importance to 0:10:00.880 --> 0:10:03.959 Donald Trump of retribution and of doing all the things 0:10:04.000 --> 0:10:05.319 that people said that he couldn't do. 0:10:05.840 --> 0:10:06.920 And I think that. 0:10:07.880 --> 0:10:12.240 Nationally and globally, he sent a very clear signal that 0:10:12.679 --> 0:10:15.920 he is basically going to go out there and give 0:10:15.920 --> 0:10:18.080 it a shot to do whatever he wants, whether that's 0:10:18.160 --> 0:10:22.240 renaming the Gulf of Mexico, whether it's taking back Panama Canal, 0:10:22.440 --> 0:10:26.640 whether it's taking greenland, or whether it's just changing national 0:10:26.920 --> 0:10:30.280 policies that the American people have become accustomed to, or 0:10:30.320 --> 0:10:35.680 renaming mountains. And I think he's making this more about 0:10:35.760 --> 0:10:39.280 himself than about moving forward. There was no attempt whatsoever 0:10:39.559 --> 0:10:41.680 to try and unify the country, or even to pay 0:10:41.720 --> 0:10:43.720 lip service to the idea that he would be a 0:10:43.720 --> 0:10:46.800 president for all Americans. I don't think Democrats are surprised 0:10:46.800 --> 0:10:49.959 by this, But this was his first opportunity to veer 0:10:49.960 --> 0:10:52.360 away from the campaign messaging, and he opted not. 0:10:52.360 --> 0:10:53.000 To do it. 0:10:53.040 --> 0:10:56.200 Professor, does he need to do that? He's won, He's 0:10:56.240 --> 0:10:59.599 not running again. Can't run again. Maybe he would like 0:10:59.640 --> 0:11:02.400 to run it again, he can't run again. Does he 0:11:02.480 --> 0:11:04.319 need to appeal to all Americans? 0:11:05.559 --> 0:11:08.640 He doesn't need to appeal two years. 0:11:08.400 --> 0:11:10.000 He doesn't need to appeal to them. 0:11:10.000 --> 0:11:13.200 The question is does he want to actually move the 0:11:13.240 --> 0:11:16.440 country in a direction that most Americans and I don't 0:11:16.440 --> 0:11:19.679 mean just a tiny margin, you know, want him to 0:11:19.720 --> 0:11:22.560 move the country in. And typically in their second terms, 0:11:22.880 --> 0:11:27.000 presidents do have some flexibility to do that because they're 0:11:27.000 --> 0:11:30.080 not seeking reelection, and the new nominee won't be seeking 0:11:30.120 --> 0:11:33.160 election for two years. Donald Trump has definitely made this 0:11:33.200 --> 0:11:35.800 more about retribution than unification. 0:11:36.080 --> 0:11:37.800 You know, I think you bring up a good point, Monica, 0:11:37.840 --> 0:11:40.960 come on back in, because I do think about you know, 0:11:41.040 --> 0:11:42.679 I want to say the two Americas, but I think 0:11:42.679 --> 0:11:44.800 there's more than just two. And we know that there 0:11:44.800 --> 0:11:46.360 are folks who are in the market that we know 0:11:46.360 --> 0:11:48.199 there are folks that are wealthy that have done very 0:11:48.280 --> 0:11:49.880 very well over the last couple of years. There are 0:11:49.880 --> 0:11:52.040 a lot of Americans that have not. And so how 0:11:52.040 --> 0:11:54.720 do we really find you know, what do we need 0:11:54.760 --> 0:11:57.640 in terms of a president that can really appeal to 0:11:57.720 --> 0:12:00.200 the broader population that benefits more. 0:12:00.679 --> 0:12:03.240 I think that Trump did that in this election cycle. 0:12:03.320 --> 0:12:04.480 I think that it speaks for. 0:12:04.440 --> 0:12:07.360 Itself appealed, but does he actually follow through with policy 0:12:07.400 --> 0:12:08.599 that helps more Americans. 0:12:08.640 --> 0:12:11.640 Well, that's the important thing about Congress, and people seem 0:12:11.679 --> 0:12:13.559 to forget about the role of Congress. He can do 0:12:13.640 --> 0:12:16.280 a lot with executive orders, one hundred percent, He's going 0:12:16.320 --> 0:12:18.720 to go big on day one. But when we think 0:12:18.760 --> 0:12:22.079 about what can Congress do, especially around the tax piece 0:12:22.559 --> 0:12:24.520 that's really important. We do think that there's going to 0:12:24.520 --> 0:12:27.720 be a full extension of the individual tax components, which 0:12:27.760 --> 0:12:31.160 could be supportive of you know, multiple layers of wealth, 0:12:31.679 --> 0:12:33.960 but you know you're also going to see a continuation 0:12:34.040 --> 0:12:38.400 of support for things like the higher earners when you're 0:12:38.440 --> 0:12:42.160 thinking about no changes to capital gains tax I think 0:12:42.240 --> 0:12:45.600 is a really good example where the most wealthy will 0:12:45.640 --> 0:12:47.679 be able to continue to accruve that wealth. They don't 0:12:47.720 --> 0:12:50.400 think that's a secret. That's something that you know, we 0:12:50.440 --> 0:12:54.200 are focused on and we do consider. But when we're 0:12:54.240 --> 0:12:58.120 looking through the broader agenda and sort of what's top 0:12:58.160 --> 0:13:00.520 of mind for folks, we want to see, you know, 0:13:00.720 --> 0:13:05.160 where can you actually benefit across the board, and one 0:13:05.160 --> 0:13:08.880 of those areas you could surprisingly be in the clean 0:13:09.000 --> 0:13:11.600 energy sector as far as creating new jobs. And I 0:13:11.640 --> 0:13:14.720 really want to emphasize that now the IRA the Inflation 0:13:14.800 --> 0:13:18.440 Reduction Act, about eighty percent of the funding went to 0:13:18.640 --> 0:13:21.439 red states, and in red states where maybe they haven't 0:13:21.440 --> 0:13:24.320 had the same type of economy, the same sort of 0:13:24.360 --> 0:13:27.480 agglomeration that we experience here in New York. Right with 0:13:27.520 --> 0:13:31.240 all these jobs, these are opportunities for those that growth 0:13:31.280 --> 0:13:34.320 sector to continue to employ people in those states. So 0:13:34.360 --> 0:13:36.400 we think, for example, that clean energy might be a 0:13:36.440 --> 0:13:40.280 sleeper agent. You have oil sort of at the when 0:13:40.280 --> 0:13:43.600 you're thinking about messaging oil Drill, baby, drill. All of 0:13:43.600 --> 0:13:47.520 that sounds really exciting because it's going to lower prices 0:13:47.559 --> 0:13:50.240 at the gas pump. Again, that's also would be a 0:13:50.320 --> 0:13:53.600 regressive tax and help lower income folks if they're able 0:13:53.640 --> 0:13:56.600 to lower the price of gas. But what's important about 0:13:56.600 --> 0:13:58.600 that is that if you're lowering the price of gas, 0:13:59.040 --> 0:14:02.200 you're lowering the cost of oil in the markets. Right, 0:14:02.840 --> 0:14:04.600 it will sell off. I think it has sold off 0:14:04.600 --> 0:14:09.520 today if I was correct. And with that, comparatively, we 0:14:09.600 --> 0:14:12.360 think that clean energy could have a nice opportunity to outperform, 0:14:12.440 --> 0:14:14.680 not just on a relative basis, but also because it's 0:14:14.760 --> 0:14:17.240 sensitive to rates, and if we do get some rate 0:14:17.280 --> 0:14:20.000 cuts at the latter half of the year, we could 0:14:20.040 --> 0:14:22.560 see clean energy make a surprise upturn. 0:14:22.800 --> 0:14:24.400 All Right, we're going to leave it on that note. Manica, 0:14:24.400 --> 0:14:26.960 thank you so much. Policy analyst at Morgan Stanley. Jennifer 0:14:26.960 --> 0:14:29.280 Our thanks out to you as well, politics professor at 0:14:29.280 --> 0:14:32.680 the University of Virginia for joining us at our roundtable. 0:14:34.160 --> 0:14:37.760 You're listening to the Bloomberg Business Week podcast. Catch us 0:14:37.800 --> 0:14:41.280 live weekday afternoons from two to five pm Eastern Listen 0:14:41.320 --> 0:14:44.520 on Apple CarPlay and Android Auto with the Bloomberg Business 0:14:44.560 --> 0:14:47.600 app or watch us live on YouTube. 0:14:47.880 --> 0:14:50.040 All right, folks, we're going to continue to monitor the 0:14:50.040 --> 0:14:52.680 comings and goings at the Capital Wan Arena and certainly 0:14:52.680 --> 0:14:57.080 bring you those incidents and activities that are certainly important 0:14:57.120 --> 0:15:00.160 to the Bloomberg audience in the meantime. Henrietta tre is 0:15:00.160 --> 0:15:03.760 important because she certainly passes through some of the business 0:15:03.760 --> 0:15:06.840 development's political developments and what it means for investors in 0:15:06.880 --> 0:15:09.720 the Bloomberg community. She's co founder and director of economic 0:15:09.760 --> 0:15:13.800 policy at the investment advisory and consultancy firm VEDA Partners. 0:15:14.160 --> 0:15:17.880 Joining us on this inauguration day Monday, Henrietta, as we 0:15:17.960 --> 0:15:21.760 continue to watch the festivities at the Capitol One Arena, 0:15:22.280 --> 0:15:24.880 talk to us about this day and for you what 0:15:25.000 --> 0:15:28.400 has been maybe most important as Donald Trump has now 0:15:29.320 --> 0:15:30.600 begun his second term here. 0:15:31.480 --> 0:15:32.880 Yeah, thanks you so much for having me. 0:15:33.040 --> 0:15:35.080 The most exciting part for me is to watch all 0:15:35.080 --> 0:15:37.000 the staff go into the White House, which of course 0:15:37.280 --> 0:15:40.000 occurs behind the scenes, but starting to see the rollout 0:15:40.200 --> 0:15:44.240 of executive orders of the memos that were released earlier 0:15:44.280 --> 0:15:47.080 in the day, and now obviously President Trump, as expected, 0:15:47.200 --> 0:15:50.400 is going to hold very ceremonial signings of a lot 0:15:50.400 --> 0:15:53.280 of these executive orders that Congress is going to take 0:15:53.320 --> 0:15:56.480 a really long time to pass any legislation after this 0:15:56.560 --> 0:15:59.080 Lincoln Riley Bill, and so this is really going to 0:15:59.120 --> 0:16:01.440 be some of the first one two punch stuff that 0:16:01.440 --> 0:16:04.160 Trump can do during his second term in office. 0:16:04.640 --> 0:16:06.160 Henry had to ask you a question. I've asked a 0:16:06.160 --> 0:16:07.760 few other guests, and we're trying to see if anybody 0:16:07.800 --> 0:16:09.640 knows the answer to it. As we watch the Butler 0:16:09.680 --> 0:16:12.960 Fire Department parade in and of course President Trump was 0:16:13.200 --> 0:16:16.000 shot in Butler County and a member of that fire 0:16:16.040 --> 0:16:19.440 brigade was killed during that attack that took place over 0:16:19.440 --> 0:16:22.720 the course of the summer. We're curious about tariffs and 0:16:22.760 --> 0:16:25.400 trade policy timing. I know that's something you're monitoring very 0:16:25.440 --> 0:16:27.760 closely as well. Jamison Greer, the presidents picked to be 0:16:27.800 --> 0:16:30.480 the next US trade representative. We gather there won't be 0:16:30.480 --> 0:16:33.640 an announcement about trade policy today. What's your sense of 0:16:33.680 --> 0:16:36.360 how that's coming together. Sequencing is a word we've heard 0:16:36.360 --> 0:16:38.240 a lot over the course of our broadcast today. What's 0:16:38.240 --> 0:16:39.880 your sense of the sequencing and we might get some 0:16:39.920 --> 0:16:41.920 more detail on that trade policy. 0:16:42.880 --> 0:16:45.680 Yeah, interesting question, and some of it sort of answered 0:16:45.800 --> 0:16:48.720 or at least implied by the profits circumstances of today. 0:16:49.080 --> 0:16:50.640 Some of the least. 0:16:51.160 --> 0:16:56.280 Well received commentary from President Trump during the earlier ceremonies 0:16:56.320 --> 0:17:00.160 from Republicans in the Senate came around his announcements he 0:17:00.280 --> 0:17:02.640 was about to impose tariffs. And the first thing that 0:17:02.680 --> 0:17:05.200 really comes to my mind is that USCR Jamison Greer 0:17:05.280 --> 0:17:07.440 has not been confirmed yet and the Senators get to 0:17:07.520 --> 0:17:09.960 vote on that. So I think from a sequencing perspective, 0:17:10.000 --> 0:17:13.760 it makes sense to hold his hearings and have his 0:17:13.840 --> 0:17:17.160 vote in the United States Senate before he implements additional tariffs, 0:17:17.160 --> 0:17:18.960 either under Phase one of. 0:17:18.840 --> 0:17:23.120 The US China trade war or even against Canada with DAIPA. 0:17:23.240 --> 0:17:26.160 Whatever happens on tariffs is going to land on Howard 0:17:26.240 --> 0:17:30.520 Lutnick and Commerce and Jamison Greer at USTR, Scott Bessett 0:17:30.560 --> 0:17:34.280 to an extent at Treasury, and those are Senate confirmed roles. 0:17:34.320 --> 0:17:36.080 So some of those are going to start tonight with 0:17:36.160 --> 0:17:39.639 Marco Rubio, we understand, and then throughout the rest of 0:17:39.680 --> 0:17:42.240 his week. So I would expect some initial trade action 0:17:42.400 --> 0:17:46.440 right after those folks get confirmed. Otherwise, those Republican senators 0:17:46.520 --> 0:17:48.560 from farm states who are going to be hit the 0:17:48.600 --> 0:17:52.320 hardest in any retaliatory measures are going to have problems 0:17:52.359 --> 0:17:54.000 and maybe hold up some of his nominees. 0:17:54.000 --> 0:17:56.040 So I think it makes sense to expect this to. 0:17:56.080 --> 0:17:58.600 Date a couple of days before you see a major action, 0:17:58.680 --> 0:18:02.120 aside from just you know, signing some executive orders to 0:18:02.160 --> 0:18:03.640 study the issue of tariffs. 0:18:03.680 --> 0:18:05.920 How do you read into the report that Bloomberg News 0:18:05.920 --> 0:18:09.160 in the Wall Street Journal had earlier today about the 0:18:09.200 --> 0:18:12.560 President not going through with tariffs on day one going 0:18:12.560 --> 0:18:16.160 through with tariffs immediately. Is that instead forming this sort 0:18:16.200 --> 0:18:19.320 of study, doing this sort of study of trade policy 0:18:19.320 --> 0:18:21.920 in order to come up with something that may be 0:18:22.040 --> 0:18:24.359 different than what he talked about on the campaign trail, 0:18:25.119 --> 0:18:28.520 Is that a win for people in the administration such 0:18:28.560 --> 0:18:31.800 as Scott Bessant or more traditional Wall Street folks. 0:18:32.240 --> 0:18:33.119 How are you viewing that? 0:18:34.160 --> 0:18:37.119 Yeah, I would separate Scott Besson from traditional Wall Street folks. 0:18:37.440 --> 0:18:41.360 Scott Besson, of course supports a gradual escalation of tariff's. 0:18:41.520 --> 0:18:44.640 I've heard him say directly five percent increases per month, 0:18:44.720 --> 0:18:46.640 So I wouldn't expect him to be the voice of 0:18:46.640 --> 0:18:48.040 opposing tarifs whole sale. 0:18:48.320 --> 0:18:49.520 That's not in his agenda. 0:18:50.400 --> 0:18:54.680 My expectation is that We have a lot of very 0:18:54.720 --> 0:18:58.040 serious campaign promises that Trump promised to deliver on the 0:18:58.119 --> 0:19:01.000 trail on day one, and most of the pertain to immigration, 0:19:01.359 --> 0:19:05.480 which we're seeing, transgender rights, energy policies. So I think 0:19:05.520 --> 0:19:08.120 there's going to be you know, one hundred different executive orders. 0:19:08.119 --> 0:19:09.480 There's a lot there to chew on. 0:19:09.920 --> 0:19:12.480 When it comes to the tariffs, one of the things 0:19:12.480 --> 0:19:15.280 that I've really wondered about is whether Jamison Greer at 0:19:15.359 --> 0:19:18.720 USTR would adhere to the enforcement mechanism of the Phase 0:19:18.720 --> 0:19:21.920