WEBVTT - Bloomberg Surveillance TV: November 17th, 2025 0:00:00.080 --> 0:00:06.760 Bloomberg Audio Studios, Podcasts, radio News. 0:00:11.680 --> 0:00:15.480 This is the Bloomberg Surveillance Podcast. I'm Jonathan Ferrow, along 0:00:15.520 --> 0:00:18.720 with Lisa Bromwitz and Amerie Hordernt. Join us each day 0:00:18.760 --> 0:00:22.280 for insight from the best in markets, economics, and geopolitics 0:00:22.440 --> 0:00:24.880 from our global headquarters in New York City. We are 0:00:24.960 --> 0:00:27.680 live on Bloomberg Television weekday mornings from six to nine 0:00:27.760 --> 0:00:31.319 am Eastern. Subscribe to the podcast on Apple, Spotify or 0:00:31.360 --> 0:00:33.960 anywhere else you listen, and as always on the Bloomberg 0:00:34.040 --> 0:00:35.880 Terminal and the Bloomberg Business app. 0:00:36.320 --> 0:00:37.440 The economy very. 0:00:37.400 --> 0:00:40.640 Much in focus investors awaiting the delayed September jobs report 0:00:40.880 --> 0:00:43.600 due out on Thursday. Towson's slock of Apollo making the 0:00:43.640 --> 0:00:46.200 case for a rebound in the economy, writing Liberation Day 0:00:46.520 --> 0:00:50.000 was almost eight months ago. Fiscal and monetary policy are easy, 0:00:50.080 --> 0:00:54.160 and easy financial conditions point to a re acceleration. Tawson 0:00:54.240 --> 0:00:56.520 joins us now for more toast and welcome back, sir. 0:00:56.720 --> 0:00:59.280 Are you expecting to see some of that in the 0:00:59.320 --> 0:01:01.520 September job data or is that too early? 0:01:02.840 --> 0:01:05.320 That is too early, because the risk, of course is 0:01:05.360 --> 0:01:06.959 that in October we had to go home and shut 0:01:06.959 --> 0:01:09.600 down and of course, the chances that that werefore might 0:01:09.640 --> 0:01:12.600 be some weaker data for the month of potentially in 0:01:12.600 --> 0:01:14.920 November also once we do get that. But I do 0:01:14.959 --> 0:01:17.360 expect that once we look into next year, we have 0:01:17.720 --> 0:01:21.399 still relatively easy financial conditions, with of course the stock 0:01:21.440 --> 0:01:24.480 markets some wabbles more recently, but still very supportive. ITG spreads, 0:01:24.560 --> 0:01:27.480 higher spreads, loan spreads very supportive. You also, at the 0:01:27.520 --> 0:01:30.600 same time have that you have tailwinds because deperation days 0:01:30.680 --> 0:01:33.559 now eight months ago. And finally we also have general 0:01:33.600 --> 0:01:36.119 tail wins because we are going into an election gem 0:01:36.200 --> 0:01:38.080 and therefore if we do get the two thousand dollars 0:01:38.080 --> 0:01:40.280 stimulus checks that you just talked about, that will certainly 0:01:40.319 --> 0:01:43.000 also be helpful. So in total, I do think that 0:01:43.040 --> 0:01:45.240 the market is too negative on the economic outlook and 0:01:45.280 --> 0:01:49.200 the risks actually rising that we may have some reacceleration. 0:01:48.760 --> 0:01:50.360 Once we get into twenty twenty six. 0:01:50.440 --> 0:01:53.440 Toston. Is that reacceleration that comes with jobs growth or not. 0:01:55.200 --> 0:01:57.360 I do think that it will come to job growth. 0:01:57.400 --> 0:01:59.840 It is actually very impressive when we think about it 0:02:00.080 --> 0:02:02.320 that over the last eight months, think about what we've 0:02:02.320 --> 0:02:05.200 been through, the shocks that the US economy has been facing, 0:02:05.600 --> 0:02:08.360 not only when it comes to of course trademark, also 0:02:08.440 --> 0:02:11.040 the shocks coming from immigration. And as you just mentioned, Jonathan, 0:02:11.360 --> 0:02:14.200 the non fund payroll equilibrium is now down at fifty thousand, 0:02:14.200 --> 0:02:16.560 accing to the Dallas fit is as low as thirty thousand. 0:02:16.880 --> 0:02:19.680 So therefore the bar has been lowered, and therefore I 0:02:19.720 --> 0:02:21.600 do think that if we get numbers that are in 0:02:21.639 --> 0:02:24.040 that range, then we should look at that and say 0:02:24.080 --> 0:02:26.519 this is exactly where we should be. So in that sense, 0:02:26.600 --> 0:02:29.280 I do think that the economy has been remarkably resilient 0:02:29.520 --> 0:02:31.120 for the last eight months, and I do think that 0:02:31.160 --> 0:02:33.639 as the trademark gets more and more behind us, I do. 0:02:33.520 --> 0:02:35.440 Think that a lot of the fog will be lifting. 0:02:35.600 --> 0:02:38.080 Towardst And to Emory's point earlier, how important are the 0:02:38.080 --> 0:02:41.079 retail earnings this week, the walmarts, the targets, the lows. 0:02:43.160 --> 0:02:45.360 They are very important and they do fit into the 0:02:45.360 --> 0:02:47.840 broader conversation about the k shape recovery. So it is 0:02:47.880 --> 0:02:50.880 still the case that high income households continue to benefit 0:02:50.960 --> 0:02:53.760 from ASER prices having been higher, and of course alsore 0:02:53.840 --> 0:02:56.560 very importantly because the level of yeals is higher. That 0:02:56.639 --> 0:02:59.400 means that not only are high income households benefiting from 0:02:59.520 --> 0:03:02.040 as is going up, but they also benefiting from the 0:03:02.120 --> 0:03:04.880 cash flow they get in fixed income is at the 0:03:04.960 --> 0:03:08.040 highest level in decades, both when it comes to public 0:03:08.040 --> 0:03:11.520 credit but also private credit. So therefore the tailwind through 0:03:11.600 --> 0:03:14.760 high income household continues to be strong. Low income households 0:03:14.800 --> 0:03:17.400 have been suffering from interest rates going up. They've also 0:03:17.440 --> 0:03:19.920 been suffering from weight growth being weaker than what you 0:03:19.919 --> 0:03:22.800 see for high income households. But probably speaking again, with 0:03:22.919 --> 0:03:26.080 job growth still steady and stable, and again the trade 0:03:26.080 --> 0:03:28.840 one certainty more and more behind us, and especially now 0:03:28.919 --> 0:03:30.639 think about the one big bult of a bill. The 0:03:30.720 --> 0:03:33.480 CBO is estimating that that will lift GDP growth next 0:03:33.560 --> 0:03:36.560 year by zero point nine percent. That's a very significant 0:03:36.560 --> 0:03:39.280 tale in for fiscal policy. So all those things combined 0:03:39.640 --> 0:03:41.800 argue for the economy beginning to look better as we 0:03:41.840 --> 0:03:43.080 get into twenty twenty six. 0:03:43.120 --> 0:03:43.520 Interesting. 0:03:43.560 --> 0:03:45.560 Conceivably, this could argue for the Fed not to cut 0:03:45.600 --> 0:03:47.600 race and explains why there has been a more hawkish 0:03:47.640 --> 0:03:49.320 tilt to some of the communication that we've gotten from 0:03:49.320 --> 0:03:52.360 Fed officials recently. What do you think the consequences would 0:03:52.360 --> 0:03:54.480 be if the Fed cuts by another fifty to seventy 0:03:54.480 --> 0:03:56.480 five basis points by mid year next year. 0:03:57.480 --> 0:03:59.720 Oh, that would be very serious, because think about it, 0:04:00.040 --> 0:04:02.520 we already have an outlook. If I time ECFC, go 0:04:02.640 --> 0:04:04.760 on my Bloomberg screen and look at the quarterly profile, 0:04:05.000 --> 0:04:07.800 it is already the case that the consensus expects inflation 0:04:07.880 --> 0:04:10.680 to be three percent for the next eighteen months, while 0:04:10.720 --> 0:04:13.040 at the same time growth is slowing down. So to 0:04:13.120 --> 0:04:15.560 your point here, Lisa, if we now see that growth 0:04:15.600 --> 0:04:18.400 is actually not slowing down and we already have inflation 0:04:18.440 --> 0:04:20.919 at three in a slowdown scenario, the risk is of 0:04:20.960 --> 0:04:23.640 course that inflation could be even higher than three percent, 0:04:23.839 --> 0:04:26.560 So cutting into that would of course be a major mistake. 0:04:26.720 --> 0:04:28.520 So I do think that the risks are rising that 0:04:28.600 --> 0:04:31.480 we are again under estimating that inflation has a lot 0:04:31.480 --> 0:04:33.880 more tailwind over the next slevel quarters. 0:04:33.960 --> 0:04:36.320 With that as a potential backdrop, what would it mean 0:04:36.320 --> 0:04:39.520 that if the government gave everyone two thousand dollars? 0:04:40.520 --> 0:04:43.159 Oh, that of course would provide even more fuel here 0:04:43.240 --> 0:04:45.640 to the economy. So if we already have the one 0:04:45.680 --> 0:04:47.880 big bill for bill, lifting GDP by almost of four 0:04:47.880 --> 0:04:50.640 Percenter's point, we have trade more uncertainty beginning to be 0:04:50.720 --> 0:04:51.400 more behind us. 0:04:51.600 --> 0:04:53.360 If we still have stock prices. 0:04:53.600 --> 0:04:56.240 We are discussing the AI bubble all of us very 0:04:56.240 --> 0:04:59.440 intensely at the moment, but given that there's still tailwind 0:04:59.520 --> 0:05:01.560 in the stock mart that's supporting of course high in 0:05:01.640 --> 0:05:05.599 consumer households in particular, all those things combined, they definitely 0:05:05.720 --> 0:05:07.799 argue that if you send out two thousand dollars checks, 0:05:07.920 --> 0:05:10.039 then you just run the risk that you will overheat 0:05:10.080 --> 0:05:11.080 the economy even more. 0:05:11.200 --> 0:05:14.080 Austin Tilst And then we're introducing a new FED chair 0:05:14.160 --> 0:05:15.920 on top of all of this as well in May 0:05:15.960 --> 0:05:17.320 of next year, and I just want to toast on 0:05:17.360 --> 0:05:19.320 how difficult it is right now to offer any kind 0:05:19.320 --> 0:05:22.359 of outlook on FED policy for next year, including that 0:05:22.480 --> 0:05:25.440 second half of next year, which includes the new FED chair. 0:05:27.120 --> 0:05:29.159 That's right, Jonathan, and that's exactly why I think that 0:05:29.240 --> 0:05:31.960 the firm CEA members are really coming up with quite strong, 0:05:32.160 --> 0:05:34.760 strong voices at the moment. Laurie Logan and first of 0:05:34.800 --> 0:05:36.839 all saying that she did vote for the cut, and 0:05:36.880 --> 0:05:39.320 then subsequently saying well I didn't really want a cut, 0:05:39.480 --> 0:05:41.680 and now also on Friday, it really begins to emphasize 0:05:41.680 --> 0:05:44.279 more that will we still need to get inflation under control, 0:05:44.520 --> 0:05:46.640 and whereas you have of course, other inform C members 0:05:46.680 --> 0:05:48.560 deem be run in particular, of course, saying that we 0:05:48.560 --> 0:05:51.240 should be cutting shol around the later. The dots are 0:05:51.560 --> 0:05:54.880 really moving in very opposite directions here, and it's becoming 0:05:55.080 --> 0:05:58.240 much more outspoken from the firm SEA members what exactly 0:05:58.279 --> 0:06:01.160 that the abuse are because this debate, to your point, Jonathan, 0:06:01.480 --> 0:06:04.719 is really still very very early, in particular when you 0:06:04.760 --> 0:06:07.600 have these very strong opinions about what are the tailwinds 0:06:07.600 --> 0:06:08.479 and what are the headwinds at the. 0:06:08.480 --> 0:06:10.680 Moment, sosten g think this is a new era for 0:06:10.720 --> 0:06:13.400 the Federal Reserve where we're going to see greater dispersion 0:06:13.560 --> 0:06:17.160 at least publicly from policymaker to policy maker. And ultimately, 0:06:17.440 --> 0:06:20.280 what do you think the consequences are for financial markets. 0:06:21.960 --> 0:06:23.680 I think it is a new error because we do 0:06:23.920 --> 0:06:26.200 make it, by definition, of course, a new fetchure in 0:06:26.240 --> 0:06:28.720 May of next year, because that's when Japal has to 0:06:28.760 --> 0:06:31.039 step down, and then we will of course figure out 0:06:31.120 --> 0:06:33.800 if that Fitchuair of course, is going to take the 0:06:33.839 --> 0:06:36.120 same view as the Iran or if that pitcher is 0:06:36.120 --> 0:06:38.560 going to have the view of Laurie Logan, and if 0:06:38.560 --> 0:06:40.440 the risk is of course that that Fitchair comes in 0:06:40.480 --> 0:06:43.320 and then begins to say, well, interest rates could begin 0:06:43.440 --> 0:06:47.400 to go down because maybe the economy can handle lower rates. Then, 0:06:47.440 --> 0:06:49.240 of course the fear could be that inflation is going 0:06:49.279 --> 0:06:52.120 to be high. So they debate exactly to your point, Jonathan, 0:06:52.200 --> 0:06:54.760 year around what should we put weight on, especially in 0:06:54.839 --> 0:06:56.960 the dual mandate. Should we put weight on inflation still 0:06:56.960 --> 0:06:59.039 being a three percent? Should we put an eight on 0:06:59.360 --> 0:07:01.760 challenge a great Christmas showing that there are maybe a 0:07:01.800 --> 0:07:04.280 bit more announced job cuts. I mean, this is still 0:07:04.279 --> 0:07:06.359 a very very important debate and we will not know 0:07:06.480 --> 0:07:09.119 the answers to this before we get into January. Remember also, 0:07:09.240 --> 0:07:13.160 the non found payroll numbers for November are normally collected 0:07:13.200 --> 0:07:15.360 in the month I'm sorry, in the month the week 0:07:15.400 --> 0:07:17.240 of the twelfth, and in the month of November, the 0:07:17.240 --> 0:07:19.640 week of the twelfth was last week, so that means. 0:07:19.440 --> 0:07:21.280 The week closer to Thanksgiving. 0:07:21.480 --> 0:07:23.280 That means that even there may be some distortions on 0:07:23.280 --> 0:07:25.400 the data for November. So that means that we may 0:07:25.440 --> 0:07:27.280 get all the way into next year before we really 0:07:27.360 --> 0:07:29.760 have a better handle at how strong is the US 0:07:29.840 --> 0:07:32.840 labor market. So that's why we still have a fairly 0:07:33.000 --> 0:07:35.800 foggy situation for the next several months. 0:07:37.240 --> 0:07:50.280 Stay with us Mulblindberg surveillance coming up after this stock 0:07:50.360 --> 0:07:52.880 sent chin KaiA ahead of keley earnings from Nvidia. Sarah 0:07:52.920 --> 0:07:55.960 Hunt of vampind saxon Words, writing earnings estimates still seem 0:07:56.040 --> 0:07:59.120 to be faring well and absent any bad news from Nvidia, 0:07:59.200 --> 0:08:01.680 markets could stay on track for a positive end to 0:08:01.760 --> 0:08:04.280 the year. Sarah joined Just Now for more Sarah good Mornick. 0:08:04.320 --> 0:08:06.760 If morning, what are the lessons from the recent volatility, 0:08:07.040 --> 0:08:08.720 If there are any lessons at all. 0:08:09.640 --> 0:08:11.400 I think that there was a whole lot of things 0:08:11.400 --> 0:08:13.880 that were going on that created some of that downdraft. 0:08:13.920 --> 0:08:15.720 And I think I mean, there was an earlier question 0:08:15.760 --> 0:08:17.920 about what's the most important thing that's coming up this week. 0:08:17.920 --> 0:08:20.360 I think it's a question of timing. If the payrolls 0:08:20.440 --> 0:08:22.680 was coming before in video, i'd say payrolls. But because 0:08:22.680 --> 0:08:25.119 in video's coming first, that's going to set a tone 0:08:25.160 --> 0:08:27.320 and either payrolls are going to help that or hurt that. 0:08:27.760 --> 0:08:29.840 And I think that, you know, if you get any 0:08:29.840 --> 0:08:32.000 more downdraft in technology, it's going to be hard to 0:08:32.080 --> 0:08:33.480 rally through the end of the year because there is 0:08:33.520 --> 0:08:35.600 some concern there and there's some concerns about valuation. 0:08:35.640 --> 0:08:37.680 We've been speaking for years about the K shaped economy. 0:08:37.760 --> 0:08:40.559 This week's the K shape market. Consumer's been struggling. You've 0:08:40.600 --> 0:08:42.640 seen that in some of the restaurant earnings. We're going 0:08:42.679 --> 0:08:45.000 to see in the retailer's potentially later this week, and 0:08:45.000 --> 0:08:47.880 then it's in video. Can we close that K anytime soon? 0:08:47.920 --> 0:08:50.640 In the equity market, never mind the economy. 0:08:51.040 --> 0:08:54.040 It's a bit tough because people are if the technology 0:08:54.040 --> 0:08:56.360 story stays on track, people stay away from some of 0:08:56.360 --> 0:08:59.160 the retail areas where you've seen weakness. If there's a wobble, 0:08:59.200 --> 0:09:01.120 then people start looking at staples. Like you saw that 0:09:01.160 --> 0:09:03.360 downdraft day, there was some of the stocks that were 0:09:03.360 --> 0:09:07.240 doing okay, we're the more value oriented, more divinend oriented, 0:09:07.280 --> 0:09:10.120 more cat like those kind of stocks did better. I 0:09:10.120 --> 0:09:12.520 think there's an argument to be made that going into 0:09:12.559 --> 0:09:15.400 next year, with valuations where they are, there should definitely 0:09:15.400 --> 0:09:17.400 be a balance in the portfolio, and you should have 0:09:17.559 --> 0:09:20.480 some of that because if you get volatility, that's going 0:09:20.520 --> 0:09:22.360 to act better than some of the technology. And I 0:09:22.360 --> 0:09:24.319 think the volatility is just going to stay and get 0:09:24.360 --> 0:09:26.000 moved around from data point to data point. 0:09:26.200 --> 0:09:29.040 Is it Vidia the last tech company to actually feel 0:09:29.080 --> 0:09:32.280 the pain if AI isn't delivering on some of the 0:09:32.320 --> 0:09:33.720 promise that people expect. 0:09:34.360 --> 0:09:36.160 Well, it's interesting to see the number of people who 0:09:36.200 --> 0:09:39.720 are going publicly talking about getting out of their Nvidia stakes, 0:09:39.880 --> 0:09:41.680 and I'm not sure if that's one of those we 0:09:41.720 --> 0:09:43.640 want to move on to the next thing, or we 0:09:43.679 --> 0:09:45.920 think that's the top for Nvidia. I think in Nvidia 0:09:46.040 --> 0:09:47.960 is in a good spot in terms of being able 0:09:48.000 --> 0:09:49.199 to keep bringing money in. 0:09:49.160 --> 0:09:50.680 Because people still need these chips. 0:09:50.840 --> 0:09:53.360 There is, to your point earlier, also a big depreciation 0:09:53.480 --> 0:09:55.480 cycle on those chips, so there is a round robin. 0:09:55.679 --> 0:09:57.120 It's not like you buy it once and you don't 0:09:57.120 --> 0:09:59.120 have to buy them again. So I don't know that 0:09:59.240 --> 0:10:01.959 Nvidia is going to be the problem there. I think 0:10:02.000 --> 0:10:03.880 the issue is going to be who's making money with 0:10:03.920 --> 0:10:06.120 those chips and how is that return coming, because that 0:10:06.240 --> 0:10:08.760 is the big question into the next iteration of AI. 0:10:08.920 --> 0:10:11.280 This is the reason why Oracle has been so interesting, 0:10:11.320 --> 0:10:14.320 why OpenAI has been so interesting, why the CDs spreads 0:10:14.320 --> 0:10:16.640 and how much they've been blowing out has been so interesting, 0:10:16.679 --> 0:10:19.400 because there is a question about whether the rank and 0:10:19.440 --> 0:10:24.000 file company in the average economy is seeing the monetization 0:10:24.440 --> 0:10:26.880 from some of the new AI tools that they've been getting, 0:10:26.880 --> 0:10:29.840 and whether that's enough to justify the massive spending and investment. 0:10:30.400 --> 0:10:33.360 Is anything that you're seeing seeming to suggest that, yes, 0:10:33.520 --> 0:10:35.440 we are getting to a place where we will see 0:10:35.559 --> 0:10:38.880 massive c change kinds of earnings from the rank and 0:10:38.880 --> 0:10:41.319 file companies that could lead to that broadening out and 0:10:41.360 --> 0:10:43.319 a justification for AI valuations. 0:10:43.679 --> 0:10:45.959 I think the hard thing is that to believe that 0:10:45.960 --> 0:10:48.120 that is going to be the case in the near term, 0:10:48.200 --> 0:10:51.360 it has to be about to some degree productivity, which 0:10:51.400 --> 0:10:53.320 has to be about not having as many people on 0:10:53.360 --> 0:10:55.760 the payrolls. And that's not a great thing right now 0:10:55.800 --> 0:10:58.720 because we don't want to see that happen. I don't 0:10:58.720 --> 0:11:02.080 know that we are yet understanding exactly how those tools 0:11:02.080 --> 0:11:05.280 are going to play into a variety of things, including 0:11:05.280 --> 0:11:08.160 productivity and better earnings, except to get rid of people. 0:11:08.240 --> 0:11:09.880 And so I think that you need to see some 0:11:10.800 --> 0:11:13.520 work cases where it's very clear that this is less 0:11:13.520 --> 0:11:15.520 about getting rid of people and more about making them 0:11:15.520 --> 0:11:16.240 more productive. 0:11:16.400 --> 0:11:19.160 And I think that's still not quite clear. 0:11:18.920 --> 0:11:22.040 Enough from the investment side to say, oh, I can 0:11:22.080 --> 0:11:23.920 see this going into this industry in that industry and 0:11:23.920 --> 0:11:24.480 that industry. 0:11:24.679 --> 0:11:26.480 That's what people are hoping for. I don't know that 0:11:26.520 --> 0:11:27.040 we're there yet. 0:11:27.120 --> 0:11:29.240 At least I mentioned this earlier about how some FED 0:11:29.320 --> 0:11:31.760 members are talking about the structural changes in the economy, 0:11:31.840 --> 0:11:35.800 like immigration, like these technology changes, which is why potentially 0:11:36.080 --> 0:11:38.000 there are shifts in a labor market. How does the 0:11:38.040 --> 0:11:40.199 FED address that. 0:11:40.200 --> 0:11:42.720 That's another question that having a whole bunch of six 0:11:42.760 --> 0:11:45.440 weeks of not having data does not help you at all, 0:11:45.679 --> 0:11:47.760 because that is trying to figure out what the right 0:11:47.880 --> 0:11:51.040 number is to tourist and slacks point with given all 0:11:51.080 --> 0:11:53.760 the things that are going on, is very difficult. When 0:11:53.800 --> 0:11:56.320 you don't have enough data, you don't see weekly claims either, 0:11:56.360 --> 0:11:58.000 which also sort of informs you. 0:11:58.080 --> 0:11:58.800 Even if it's not. 0:11:58.880 --> 0:12:01.320 That week, that average of that starts to inform you. 0:12:01.800 --> 0:12:03.800 I think that's going to be one of the things 0:12:03.800 --> 0:12:06.800 that into twenty twenty six. You need to see some 0:12:06.840 --> 0:12:09.000 earnings growth because that's what's being built in, but you 0:12:09.080 --> 0:12:11.440 also need to see a data market that people I 0:12:11.440 --> 0:12:13.480 mean a labor market that people feel comfortable with. And 0:12:13.520 --> 0:12:15.880 I think that we just don't have enough information right now, 0:12:16.160 --> 0:12:18.640 and that's where the timing of that data coming in 0:12:18.800 --> 0:12:21.680 versus other things starts to be an issue, and the 0:12:21.760 --> 0:12:23.840 faster we get some of it, the better off we are. 0:12:24.040 --> 0:12:25.640 But it's going to be about what's happening now. 0:12:25.679 --> 0:12:28.079 I don't know that September is that informative because people 0:12:28.080 --> 0:12:29.920 were looking at the ADP numbers for October. 0:12:30.120 --> 0:12:32.440 Two pillars coming out this week in terms of Wall 0:12:32.440 --> 0:12:35.800 Street for Nvidia earnings and then Main Street for when 0:12:35.800 --> 0:12:38.920 it comes to Walmart. Could Wall Street continue to do 0:12:38.960 --> 0:12:40.760 well if the consumer's really struggling. 0:12:41.760 --> 0:12:43.800 It's managed to do it so far this year, and 0:12:43.840 --> 0:12:46.360 the consumer has been struggling for a while, especially in 0:12:46.400 --> 0:12:48.000 the lower end. I mean you've seen some of that 0:12:48.360 --> 0:12:51.079 delinquencies on the lower end in auto loans, delinquencies on 0:12:51.080 --> 0:12:52.640 the lower end in credit cards, but not on the 0:12:52.720 --> 0:12:55.679 upper end. That upper end spend has really been able 0:12:55.720 --> 0:12:58.440 to carry things. Not so much for the retail sector 0:12:58.480 --> 0:13:00.480 because as a whole, they need more more than just 0:13:00.520 --> 0:13:02.680 the upper end, except the very high luxury stuff. 0:13:02.880 --> 0:13:04.680 So it depends on where that goes. 0:13:04.720 --> 0:13:06.880 And that's also where the labor market comes into play, 0:13:06.920 --> 0:13:09.080 because if you feel comfortable that you're keeping your job, 0:13:09.280 --> 0:13:10.120 it's easier. 0:13:09.840 --> 0:13:11.640 To spend the money as it comes in. But if 0:13:11.640 --> 0:13:13.360 you don't. That's where people start to get a little 0:13:13.360 --> 0:13:16.480 bit more in the saving site stay with us. 0:13:16.800 --> 0:13:28.920 Multiple IMBERG surveillance coming up after this. We've heard this. 0:13:28.960 --> 0:13:31.199 It's been building for a while, the push against Russia, 0:13:31.320 --> 0:13:34.360 the push against countries economies doing business with them, notably 0:13:34.480 --> 0:13:37.160 China India who asked this to supply too well. 0:13:37.240 --> 0:13:39.560 I think really it's about China and India because this 0:13:39.720 --> 0:13:42.560 is going to really force China to either have to 0:13:42.640 --> 0:13:45.120 go around some of the sanctions or deal the blow 0:13:45.160 --> 0:13:47.360 from the United States. At the same time, at the 0:13:47.360 --> 0:13:49.480 Treasury Secretary over the weekend talked about the fact that 0:13:49.559 --> 0:13:53.040 they don't have the final agreement in ink fully in 0:13:53.080 --> 0:13:55.960 place and they expect that to happen by Thanksgiving. Is 0:13:56.000 --> 0:13:59.199 this now another point of leverage Washington is trying to 0:13:59.280 --> 0:13:59.520 use it. 0:13:59.600 --> 0:14:02.480 Joining us as Terry Hynes of Pangaea Policy Terry, welcome 0:14:02.480 --> 0:14:05.080 to the program. What is the president's big effort around 0:14:05.120 --> 0:14:07.400 Russia all about and will he actually follow through? 0:14:08.720 --> 0:14:12.480 Good morning all I'm on Team Ann Marie this morning. 0:14:12.720 --> 0:14:15.920 The pick up on that point about leverage. This is 0:14:15.920 --> 0:14:18.040 about a lot of things, but one thing it is 0:14:18.040 --> 0:14:21.800 is exactly about that. What you can read between the 0:14:21.840 --> 0:14:26.000 lines from Secretary Bessett yesterday in a long interview, is 0:14:26.040 --> 0:14:30.560 that the supposed current deal that's happening between the United 0:14:30.600 --> 0:14:33.120 States and China is now taking a lot longer to 0:14:33.160 --> 0:14:37.320 paper than was widely thought even the best had said. 0:14:37.640 --> 0:14:38.560 So it's about that. 0:14:39.280 --> 0:14:43.160 It's about pushing India, I think, on getting a trade 0:14:43.160 --> 0:14:46.560 deal done. Secondly, Thirdly, I think it's about pushing the 0:14:46.560 --> 0:14:51.800 Europeans on getting serious on Russia as well. The President 0:14:51.840 --> 0:14:57.600 has long said that the United States policy only works 0:14:57.640 --> 0:15:02.160 well if the Europeans are willing to to pull equal 0:15:02.160 --> 0:15:06.720 weight here, and Europeans have been tapped dancing on core 0:15:06.840 --> 0:15:11.360 questions around Russia and frozen Russian assets for years literally, 0:15:11.480 --> 0:15:14.920 and either they're going to get serious or the Ukraine 0:15:14.960 --> 0:15:16.920 thing is going to drag on for even longer. 0:15:17.160 --> 0:15:19.520 Terry, the administration is going to use this leverage as 0:15:19.560 --> 0:15:21.560 part of the destination. But when we get to the 0:15:21.560 --> 0:15:24.680 final destination, do you think Congress will end up passing 0:15:24.720 --> 0:15:26.120 this bill? 0:15:27.080 --> 0:15:32.400 I think the I think they can sure the willingness exists, 0:15:33.280 --> 0:15:36.480 the votes exist. This is a lot more up to 0:15:37.040 --> 0:15:39.120 what the President wants to do in terms of how 0:15:40.280 --> 0:15:43.640 he wants to use that particular pressure point one thing 0:15:43.680 --> 0:15:49.720 I saw in Trump's impromptu remarks there, frankly, was an 0:15:49.760 --> 0:15:51.960 ability to take the thing off and put it back, 0:15:52.320 --> 0:15:54.080 take the thing off the back burner and put it. 0:15:54.040 --> 0:15:54.840 On the front burner. 0:15:56.240 --> 0:15:59.480 Russia may may dismiss that, but I think they probably 0:15:59.560 --> 0:16:03.520 dismissed at their peril, considering that the president has the ability, 0:16:04.760 --> 0:16:07.640 thanks to Congress, to actually get this thing done if 0:16:07.640 --> 0:16:08.160 he chooses. 0:16:08.240 --> 0:16:10.720 The Treasure Secretary seems to be throwing cold water on 0:16:10.720 --> 0:16:13.040 a Wall Street General report that says China is trying 0:16:13.080 --> 0:16:17.280 to ratchet back rare earth minerals that go to companies 0:16:17.280 --> 0:16:21.040 that help the US military. Do you think China will 0:16:21.080 --> 0:16:24.200 amend that or is this something that they're going to 0:16:24.240 --> 0:16:24.760 stick with. 0:16:26.080 --> 0:16:30.040 I think the track record here is that China has 0:16:30.120 --> 0:16:33.320 been I think best referred to April sixth in that 0:16:33.440 --> 0:16:36.720 interview as being the date in which the high drinks 0:16:36.760 --> 0:16:39.880 started on rare earths. I think they've been doing this 0:16:39.920 --> 0:16:41.920 for six or seven months. I think the base case 0:16:41.960 --> 0:16:44.440 has to be that they'll continue to do it. So 0:16:44.600 --> 0:16:47.400 what you know from a markets perspective, you have to 0:16:47.440 --> 0:16:49.160 take that into account, and you also have to take 0:16:49.200 --> 0:16:51.440 into account that the United States is going to continue 0:16:51.480 --> 0:16:55.880 to redouble and redouble every effort it can to get 0:16:55.960 --> 0:16:58.920 rare earths and start rare earths that are not of 0:16:59.000 --> 0:16:59.800 Chinese origin. 0:17:00.120 --> 0:17:02.160 Darry, how much of a conflict is there between trying 0:17:02.200 --> 0:17:04.720 to get leverage some of these trade talks and trying 0:17:04.760 --> 0:17:07.720 to get cost of living gains for the United States 0:17:07.720 --> 0:17:10.760 and for average consumers, given the fact that that seems 0:17:10.800 --> 0:17:12.879 to be a renewed push by the president, is there 0:17:12.880 --> 0:17:13.680 a conflict here? 0:17:14.800 --> 0:17:17.199 I think there's an order of precedence here, and the 0:17:17.280 --> 0:17:20.560 order of precedence from the administration's point of view is 0:17:20.560 --> 0:17:23.480 that they need to get the trade deals done as 0:17:23.600 --> 0:17:27.320 many and as much as possible and move forward from there. 0:17:27.440 --> 0:17:31.800 And they will, you know, they tend to put their 0:17:31.840 --> 0:17:34.399 stake out kind of you know, far and in a 0:17:34.960 --> 0:17:38.200 in a pure sense, and when work back and cut 0:17:38.240 --> 0:17:40.080 back as they need to. And I think that's a 0:17:40.080 --> 0:17:42.000 lot of what you saw with the food stuff's tariffs 0:17:42.080 --> 0:17:46.280 last weekend or last week Besson talked about this as 0:17:46.359 --> 0:17:49.720 being mostly a matter of existing trade deals coming in 0:17:49.800 --> 0:17:51.440 or new trade deals coming into force. 0:17:52.080 --> 0:17:54.000 I don't think that's quite the case. It's part of 0:17:54.040 --> 0:17:56.119 the case. But what they'll. 0:17:55.880 --> 0:17:58.800 Continue to do is continue to work on the trade 0:17:58.840 --> 0:18:02.480 deals with the idea that they can calibrate them pretty 0:18:02.560 --> 0:18:04.840 much in real time as they need to. 0:18:05.119 --> 0:18:07.320 Terry, just to circle back full circle to the beginning 0:18:07.359 --> 0:18:11.520 of the conversation, how much can this administration go really 0:18:11.560 --> 0:18:14.760 hard on China with sanctions on oil if it raises 0:18:14.840 --> 0:18:17.640 gasoline prices in the United States at a time where 0:18:17.680 --> 0:18:19.560