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Speaker 1: Bloomberg Audio Studios, podcasts, radio news.

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Speaker 2: How all of these flip flops within the volatility and

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Speaker 2: the price action of markets.

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Speaker 3: I think it's more likely that we revisit the lows

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Speaker 3: than we done.

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Speaker 4: It turns out that's the beginning of the volatility in bonds,

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Speaker 4: not the end.

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Speaker 5: So the next ninety days is going to be quite

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Speaker 5: volatile in the bond market.

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Speaker 6: What's happened generally lowering the risk in the portfolio. In

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Speaker 6: this type of environment. Rather than a strong bed on

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Speaker 6: you want to be in bond's and equities, you want

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Speaker 6: to bring risks down.

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Speaker 7: What we're looking for is a very choppy year, unfortunately.

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Speaker 1: This is Bloomberg Surveillance with Jonathan Ferroll, Lisa Bromowitz, and

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Speaker 1: Anne Marie Hordern.

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Speaker 6: Live from New York City this evening. Good evening, good

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Speaker 6: evening for audience worldwide. Bloombag savandid Stats right now wrapping

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Speaker 6: up a wild week in financial markets, investors getting their

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Speaker 6: hopes up following the biggest weekly gain of the year

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Speaker 6: so far, the White House unveiling what appeared to be

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Speaker 6: tariff exemptions for big tech, only for COMMAS Secretary Howard

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Speaker 6: Latnik to reign on their parade.

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Speaker 8: They're exempt from the reciprocal tariffs, but they're included in

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Speaker 8: the semiconductored tariffs which are coming in probably a.

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Speaker 9: Month or two.

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Speaker 6: President Trump doubling down, writing there was no tariff exception

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Speaker 6: announced on Friday. They're just moving to a different tariff bucket.

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Speaker 6: So we enter a brand new training week with a

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Speaker 6: very brief sigh of relief.

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Speaker 5: Is this a sigh of relief? Do we have a

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Speaker 5: sense of what the tariff is? We moved from one

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Speaker 5: bucket of one hundred and forty six percent to maybe

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Speaker 5: twenty percent, which is the fentanyl bucket, which is where

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Speaker 5: electronics fit in. Look, this seems like President Trump coming

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Speaker 5: out and trying to push back against the idea that

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Speaker 5: he pivoted, while still offering some support to the idea

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Speaker 5: of electronics. It is clear based on what Davison Greer

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Speaker 5: as well as Howard Lutnik said that they are looking

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Speaker 5: to move forward with an additional framework of tariffs for semiconductors.

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Speaker 6: Are we negotiating with China or negotiating with ourselves? And

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Speaker 6: after a week like the one we just saw a

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Speaker 6: six percent rally almost on the S and P five hundred,

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Speaker 6: is this a policy pivot or not from this administration?

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Speaker 7: What was the policy?

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Speaker 5: I think that that is the bigger question right now,

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Speaker 5: and there is a level of exhaustion. Is this the

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Speaker 5: ultimate goal? Is this all according to plan? Because that's

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Speaker 5: what a lot of people were saying right now. People

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Speaker 5: are exhausted, People on Wall Street are exhausted. The uncertainty

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Speaker 5: itself is going to drag on growth and that is

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Speaker 5: what you see in notes pretty much across the board.

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Speaker 7: Did we get clarity, Yes, we.

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Speaker 5: Got one note of clarity, and that is that this

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Speaker 5: is a president who is watching the treasury market, but

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Speaker 5: the sort of input there is still unclear.

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Speaker 6: The first trade this morning in the equity market this

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Speaker 6: evening rather positive by zero point nine percent on the

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Speaker 6: S and P five hundred. Coming up this hour, Bob

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Speaker 6: Michael a JP Morgan as bond market moves spook investors worldwide,

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Speaker 6: Lebby Cantrell of Pimco as this weekend's policy confusion continues,

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Speaker 6: and Stuart Kaiser city on why we need good news

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Speaker 6: and we need it quick. We begin this out with

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Speaker 6: our top story this weekend, Apple and Nvidia appearing to

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Speaker 6: score a major win and for the white has to

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Speaker 6: reign on the parade, joining US now from the nation's capital,

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Speaker 6: Bloomberg's tyn of Kendo Tyler, you need to explain just

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Speaker 6: what happened this weekend.

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Speaker 2: Yeah, hey, John, good evening. Well, it's unclear how long

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Speaker 2: this for pre will last because it does appear that

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Speaker 2: these tech imports will be subject to a Section two

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Speaker 2: thirty two investigation, which could take weeks or even months.

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Speaker 2: We have to keep in mind that when President Trump

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Speaker 2: signed that initial executive order on April second, it always

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Speaker 2: excluded chips, as well as some other key industries like lumber, pharmaceuticals,

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Speaker 2: and copper that could be subject to Section two thirty

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Speaker 2: two tariffs on the basis of national security concerns. It

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Speaker 2: now appears that these other tech imports, including consumer electronics,

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Speaker 2: will fall under the sector specific umbrella instead of the

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Speaker 2: so called reciprocal plan umbrella. As you said, President Trump,

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Speaker 2: just saying that this moved from one bucket to another. Now,

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Speaker 2: with that said, when this White House has invoked Section

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Speaker 2: two thirty two before, including on steel and aluminum imports

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Speaker 2: auto imports, they've implemented a twenty five percent tariff rate.

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Speaker 2: Let's just say for the sake of the example, that

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Speaker 2: ends up what goes into effect that would be considered

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Speaker 2: to be at least an initial of victory for big tech,

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Speaker 2: because that is so much lower than what could have

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Speaker 2: been the now one hundred and forty five percent tariff

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Speaker 2: in across the board when it comes to Chinese imports.

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Speaker 2: But still some really big questions here, not just on

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Speaker 2: the timeline uncertainty, but also how is the White House

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Speaker 2: going to look at the full scope of these electronics,

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Speaker 2: for example? Or are they going to tariff of the

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Speaker 2: value of an iPhone on its whole, or are they

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Speaker 2: going to tariff just the value of the chip inside

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Speaker 2: of the iPhone. Questions like this are going to keep

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Speaker 2: coming up. But John, I will just quickly add the

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Speaker 2: one thing that remains the through line here is that

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Speaker 2: President Trump doubled down in his post that this really

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Speaker 2: is about China, reiterating that all of these products are

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Speaker 2: still subject to that twenty percent baseline tariff that Washington

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Speaker 2: imposed back in February.

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Speaker 6: It's Tyler Knda with the lightsis down in Washington, d C. Tyler,

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Speaker 6: thank you stay close as always you are looking for

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Speaker 6: that first trade. This evening. The Sunday Evening Equity features

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Speaker 6: here it is positive by one full percentage point with

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Speaker 6: more his Donny Berger hate Donny, and.

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Speaker 10: More than that when it comes to tech, John, you're

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Speaker 10: looking at an AZZAK one hundred future session that's up

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Speaker 10: one and a third percent. Maybe it is by now,

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Speaker 10: ask questions later. There's signal in the fact we are

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Speaker 10: trading this as something of a relief rally, So one

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Speaker 10: percent for the S ANDP just under one and a

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Speaker 10: third for the NASDAK or small cap session so far

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Speaker 10: with trading just underway seven tenths of one percent. Calling

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Speaker 10: this a relief though, might be a misnomer because we

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Speaker 10: have seen some huge swings. What is one percent when

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Speaker 10: we've seen stocks up and down ten percent on some days.

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Speaker 10: So let me just show you where we came from

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Speaker 10: to get to this future session. The past five trading

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Speaker 10: days was the best week for the S and P

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Speaker 10: five hundred since November of twenty twenty three. Why did

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Speaker 10: it not feel like that? It's because of this volatility

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Speaker 10: that we've seen. In fact, in the five days through Thursday,

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Speaker 10: we saw a trading range of more than six percent.

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Speaker 10: That streak has only happened two other times in history.

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Speaker 10: One was March twenty twenty the COVID epidemic, and then

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Speaker 10: the other one was October of two thousand and eight,

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Speaker 10: the peak of the financial crisis. John, I think a

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Speaker 10: lot of traders are going to be relieved that we're

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Speaker 10: heading into a holiday shore trading week coming.

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Speaker 6: Up, Danny, We can't wait, Danny Burger. Thank you. More

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Speaker 6: from Danny later on this hour. Wild swings in the

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Speaker 6: equity market, wild swings in the bond market too. Here's

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Speaker 6: the big take on Wall Street this evening, Bob Michael

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Speaker 6: a JP Morgan Asset Management right in the following. Over

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Speaker 6: the last couple of weeks, investors have been searching for science,

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Speaker 6: for anything that broke. At the end of this week,

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Speaker 6: the most unlikely of candidate surfaced the US treasury market.

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Speaker 6: The glob I had a fixed income joined us. Now

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Speaker 6: for more, Bob, good evening, It's good to see you.

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Speaker 3: Yeah, happy to be here.

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Speaker 6: Two sundays in a row. Let's wrap up this week.

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Speaker 6: The move we saw this week in the bond market.

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Speaker 6: Yields up by forty to fifty basis points on a

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Speaker 6: tenure and thirty year maturity, the dollar down by close

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Speaker 6: to three percent. Everyone's got the same question. Evidence of

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Speaker 6: bond trades blowing up, or are you starting to see

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Speaker 6: people distance themselves from dollar assets.

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Speaker 3: I think that's a great question for from our perspective,

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Speaker 3: we're seeing a complete deleveraging of positions and that's what's

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Speaker 3: been driving it. So, whether it's been swap spread trades,

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Speaker 3: where it's been the treasury basis, whether it's been investors

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Speaker 3: who sold Germany and bought the US, all those things

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Speaker 3: have begun to unwind and it's put a lot of

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Speaker 3: downward pressure on treasury prices. Two things happened at the

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Speaker 3: end of the last week that make me feel a

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Speaker 3: lot more positive this week than going into last week.

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Speaker 3: The first is Susan Collins came out and broke from

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Speaker 3: the FED script of the only thing we're watching is

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Speaker 3: inflation and talked about will be prepared. We're watching the market.

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Speaker 3: If we need to step in, we'll step in. The

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Speaker 3: other thing that we saw was the FED report that

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Speaker 3: showed that actually foreign central banks and reserve managers weren't

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Speaker 3: selling treasuries as was widely rumored. They actually even added

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Speaker 3: a little bit, and in our conversations with overseas investors,

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Speaker 3: they're not being shaken out of treasuries if that's.

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Speaker 5: The case, and how concerning would it be to you

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Speaker 5: if treasuries didn't rally this week.

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Speaker 3: I think there's still a bit more of a washout

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Speaker 3: to go. I think there are still the investors that

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Speaker 3: are coming in overseas that have seen the downward price

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Speaker 3: moves and may be unwinding some positions. But I feel

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Speaker 3: pretty good that we're putting in a low and price

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Speaker 3: and a high end yield here.

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Speaker 7: So this is the ultimate question right now.

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Speaker 5: Can this be a haven asset at a time where

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Speaker 5: the dollar didn't get that bid and the Treasury didn't

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Speaker 5: get that bid going forward? How much has to happen

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Speaker 5: for the Fed to come back into play Given the

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Speaker 5: fact that Neil Kashgari over the weekend came out and said,

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Speaker 5: ultimately where the yield ends up isn't going to.

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Speaker 7: Really be a determined of the Fed.

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Speaker 5: It's going to be about these policies when people can

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Speaker 5: understand what the new normal really is.

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Speaker 3: Yeah, and I think he also threw in inflation being anchored.

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Speaker 3: It's funny to me how the entire FOMC and we'll

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Speaker 3: see more this week, are coming out and just highlighting inflation.

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Speaker 3: When a month ago, their chair j Palll discredited at

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Speaker 3: the press conference and called a transitory again. He's going

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Speaker 3: to be right this time that it is transitory. It's

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Speaker 3: a one time price reset for tariffs that will create

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Speaker 3: demand destruction and lead us to recession. And when I

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Speaker 3: read Bruce Kasman and Mike Faroli stuff, they still have

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Speaker 3: the probability of recession still up at sixty percent. The

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Speaker 3: Fed is watching two things. They're looking for signs that

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Speaker 3: something systemically broke and that becomes a bigger problem. Right now,

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Speaker 3: we're not seeing that. It eerily feels like an orderly

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Speaker 3: online I think that's good news. The other thing they've

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Speaker 3: got to be watching is the other side of their mandate,

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Speaker 3: which is the unemployment rate. We think if you get

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Speaker 3: up four point seven percent or higher, that's up half

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Speaker 3: a percent from here, then that will put the pressure

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Speaker 3: on them to come in and bring rates down. Remember

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Speaker 3: they told us this isn't the neutral rate. This is

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Speaker 3: moderately restrictive. Three percent is neutral.

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Speaker 6: The next meeting my seventh. Last time you sat there,

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Speaker 6: just last week, you doubted whether they could hold on

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Speaker 6: until May seventh. What's your view on things now? Can

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Speaker 6: they hold on until May seventh, and do you think

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Speaker 6: May seventh is the day they pulled the trigger.

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Speaker 3: Yeah, last week it looked like we were in meltdown

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Speaker 3: phase unless there was a policy response. I think we've

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Speaker 3: seen three soft policy responses. The first came from the

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Speaker 3: administration you already went through. They gave us a ninety

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Speaker 3: day reprieve. That's fine, and they took some of the

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Speaker 3: tariffs off of electronics for the time being. That's okay,

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Speaker 3: that's backing up. The second came from Congress, where the

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Speaker 3: House passed the Senate Budget Resolution, So Congress in a

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Speaker 3: way gave us something. And then I'm going to say

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Speaker 3: the third is Susan Collins finally sending us home over

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Speaker 3: the weekend, saying, yeah, the Fed's watching this.

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Speaker 6: We got this list. So we went into the weekend

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Speaker 6: with some pretty dreadful data. You mintioned, consumer confidence came out,

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Speaker 6: sentiment near a three year low, inflation expectations multi decade

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Speaker 6: highs anxiety about unemployment the worse since two thousand and nine.

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Speaker 6: And I think we say, hey, the saving gun into

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Speaker 6: when you tread and wait, thinking about the next phase

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Speaker 6: of all this, the damage that's done already and what

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Speaker 6: it looks like in the economic data in a weeks

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Speaker 6: to come.

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Speaker 7: That's really the main message.

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Speaker 5: You can't put the toothpaste back in the tube, you

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Speaker 5: can't put the genie back in the bottle.

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Speaker 7: We have seen a change.

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Speaker 5: We've talked about uncertainty, but there is some certainty that

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Speaker 5: things are less good than they were earlier this year,

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Speaker 5: and that this is going to have ramifications for spending

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Speaker 5: and certainly among corporation.

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Speaker 6: Well, just finally for this part of the conversation with

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Speaker 6: you this hour, can you want to do the damage

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Speaker 6: that's already done and you anticipating a round about of

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Speaker 6: pretty weak data in the weeks to come?

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Speaker 3: Yeah, I think so. And again, as I was reading

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Speaker 3: for Rolean Casman's pieces over the weekend, it's really hard

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Speaker 3: to change the confidence of businesses and households, and hence

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Speaker 3: that probability of recession is still up there at sixty percent.

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Speaker 3: It's not one hundred percent because you can see an

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Speaker 3: overwhelming policy response. How many times have we been here

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Speaker 3: during COVID or during during the regional banking crisis, when

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Speaker 3: for sure we were parleling into recession, but the aggregate

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Speaker 3: policy response was sufficient to stop it. We may see

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Speaker 3: that this time, but for now we're on path to

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Speaker 3: recession this time.

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Speaker 6: To get that response, you need to see the data

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Speaker 6: break Lisa, and that job's report for this month that

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Speaker 6: you'll see in early May. I think a lot of

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Speaker 6: people are going to put a lot of weight on

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Speaker 6: that particular print.

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Speaker 5: But how quickly can you get some sort of layoff

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Speaker 5: wave given the fact that so many companies are still

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Speaker 5: scarred from the experience during the pandemic, and we've seen

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Speaker 5: this in note after note is going to lag behind

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Speaker 5: and that is a complication for the Vetero's a.

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Speaker 6: Difference between langoff and just not hiring. And given how

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Speaker 6: many times we've heard people say wait and see, wait

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Speaker 6: and see, you have to imagine for a lot of people,

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Speaker 6: they're just going to pause hiring, aren't they for the

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Speaker 6: next few weeks, next few months.

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Speaker 5: Which is the reason why I watch the quits rate.

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Speaker 5: Watch how many people stay on the unemployment claims for

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Speaker 5: longer as that number goes up. These are some of

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Speaker 5: the peripheral data points that people are watching.

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Speaker 6: If you're just joining us, welcome to the program. Good afternoon.

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Speaker 6: SeeU Equity Futures Training and we are positive by zero

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Speaker 6: point nine percent Michael A JP Morgan will be sticking

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Speaker 6: with us. Up next on the program, the White House

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Speaker 6: keeping the pressure on.

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Speaker 9: What President Trump is doing and his vision and his

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Speaker 9: leadership is to completely realign the world economy, but in

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Speaker 9: so doing put America first.

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Speaker 8: The President is on it.

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Speaker 6: Up next on the program, we'll get the view of

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Speaker 6: Libby Cantrello PIMCO live from New York City. This evening,

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Speaker 6: good evening, the first trades underway. Equity futures at the

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Speaker 6: moment positive by zero point eight percent on A S

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Speaker 6: and P five hundred on the NASTAG up by one

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Speaker 6: point three and the savannahs This evening, the White House

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Speaker 6: attempted to keep the pressure on.

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Speaker 8: The President is on it.

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Speaker 11: It's very very important for people to understand, you know,

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Speaker 11: why we're doing what we're doing.

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Speaker 9: What President Trump is doing and his vision and his

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Speaker 9: leadership is to completely realign the world economy, but in

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Speaker 9: so doing put America first.

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Speaker 6: The world cheats us.

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Speaker 3: They've been cheating us for decades.

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Speaker 9: We have been living under a teriff regime, but it

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Speaker 9: has been the regime of other countries.

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Speaker 8: More importantly, they cheat us with the so called non

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Speaker 8: tariff barriers.

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Speaker 3: It's the VAT tax, is dumping, the currency manipulation.

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Speaker 8: We can't be relying on China for fundamental things that

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Speaker 8: we need.

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Speaker 2: What's going to be up these countries to come to

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Speaker 2: the table, continue coming to the table and make these

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Speaker 2: kinds of offers.

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Speaker 6: So here's the license, the saving, the White House pushing

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Speaker 6: for change, the President of right saying, nobody is getting

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Speaker 6: off the hook. We will not be hal hostage by

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Speaker 6: other countries, Lisa, especially hostile trading nations like China will

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Speaker 6: There was.

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Speaker 5: No teriff exception announced on Friday. These products are subject

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Speaker 5: to the existing twenty percent fentanyl tariffs and they are

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Speaker 5: just moved to a different tariff buckets. We need to

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Speaker 5: understand the tariff buckets, and the twenty percent tariff bucket

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Speaker 5: does apply to what we're.

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Speaker 7: Seeing in China. Got that good? Is it now thirty percent?

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Speaker 5: If you've got a ten percent base that comes out,

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Speaker 5: is it going to be added to the one hundred

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Speaker 5: and forty six?

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Speaker 7: You know, you can explain that.

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Speaker 6: Just what is the number? Paul Ashworth of Capital Economics

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Speaker 6: how to go at this and said the increase in

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Speaker 6: the headline tariffray on China specifically remains at one hundred

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Speaker 6: and forty five percent, but the effective increase once those

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Speaker 6: exemptions are accounted for, it's now closer to one of six.

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Speaker 7: You got that clear as mud.

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Speaker 5: I mean, look, this is the difficulty for so many

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Speaker 5: people is that the layers of tariffs just become incredibly

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Speaker 5: difficult to even start to calculate, to the point where

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Speaker 5: people start to discount them entirely. Amazon had a note

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Speaker 5: where they came out and said, if we calculate this correctly,

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Speaker 5: the numbers would be so ridiculous that we couldn't even

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Speaker 5: come out with those estimates, which is what we're hearing

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Speaker 5: pretty much across corporate America.

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Speaker 6: Let's get to the take from Libby Cantell of Pinco

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Speaker 6: right in the following. We should not underestimate Trump's ideological

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Speaker 6: commitment to this issue. So while the worst may have

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Speaker 6: been avoided, trade policy uncertainty should be priced in going

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Speaker 6: forward and places. The Libby Joints is now for more Libby.

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Speaker 6: Good evening, we go again. Here we go again. It's

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Speaker 6: good to see it, least get to see you. After

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Speaker 6: last Sunday, a lot of people started to believe there

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Speaker 6: was a policy pivot, a ninety day pause and into

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Speaker 6: the weekend some exemptions, then we got the pushback over

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Speaker 6: the weekend. Has that been a pivot or not from

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Speaker 6: your perspective, Yeah, I don't.

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Speaker 7: Think there's necessarily been a pivot.

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Speaker 4: Maybe some practicality has has has sort of trumped the ideology,

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Speaker 4: if you will. However, I think a couple of important points.

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Speaker 4: One is that this Section two thirty two investigation on

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Speaker 4: semi conductors that has been that was previewed at the

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Speaker 4: beginning of this administration. They are very committed to this.

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Speaker 4: Ambassador Greer reiterated this in front of st of Finance

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Speaker 4: and Ways and Means this week. So this is coming, however,

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Speaker 4: and I think your earlier segments alluded to this, it

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Speaker 4: will likely be a much lower tariff schedule for these

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Speaker 4: for semiconductors, potentially for phones, potentially for consumer technological products.

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Speaker 4: And so that means they're going from one hundred and

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Speaker 4: forty five percent tariff maybe down to a twenty five

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Speaker 4: percent product traff plus those twenty fentanyl that's forty five percent.

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Speaker 4: These are still incredibly draconian.

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Speaker 9: Right.

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Speaker 4: If you had mentioned any of these types of tariff

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Speaker 4: levels the beginning of the Trump administration, I think the

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Speaker 4: market would have obviously gotten you know, had some indigestion.

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Speaker 4: The second thing, though, I think really importantly is that

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Speaker 4: the actions over the weekend, I believe make this AEPA authority,

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Speaker 4: this emergency economics powers authority that the President is using

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Speaker 4: more vulnerable to legal challenge because he is using this

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Speaker 4: with the declaration that this is a national emergency. Well,

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Speaker 4: is it or not right? If you're actually carving out

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Speaker 4: exemptions a sort of Swiss cheese approach and Ambassador Agre

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Speaker 4: you're actually had said about two weeks ago. If you're

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Speaker 4: doing that, then then it kind of undermines the entire

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Speaker 4: basis for IEPA. So in some ways, I think actually

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Speaker 4: the real story is that this is already a legally

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Speaker 4: vulnerable kind of maybe specious use of AIPA authority, probably

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Speaker 4: is more vulnerable given the actions of the weekend.

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Speaker 5: Okay, hold on, This is actually fascinating to me. Who

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Speaker 5: would then sue President Trump? And how long would it

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Speaker 5: take for this to be undermined in a court of

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Speaker 5: law and would it be followed?

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Speaker 4: Yeah, So a couple of things. One is that there

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Speaker 4: is already litigation and process. There are some trade associations

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Speaker 4: that have already filed kind of the first steps towards

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Speaker 4: litigation in terms of questioning this use of AIPA. But

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Speaker 4: to your to your question, and this is obviously very

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Speaker 4: pertinent to markets. This will take a while to go

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Speaker 4: through the judiciary. There's not likely to be an injunction

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Speaker 4: because you'd have to see a reparable harm. And that's

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Speaker 4: I think that threshold is very very high.

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Speaker 7: I'm no lawyer, but you play our trade.

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Speaker 4: From what our trade attorneys are telling us, it is

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Speaker 4: that the threshold is high. However, however this is and

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Speaker 4: again I think a lot of trade lawyers, those who

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Speaker 4: are actually attorneys, would say that this was already a

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Speaker 4: very aggressive use of this statue. And again I think

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Speaker 4: today or you know, today's or this weekend's actions make

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Speaker 4: this more vulnerable.

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Speaker 6: A lot of traders would become lawyers overnight. You know that.

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Speaker 6: But Michael might become one too, Bob. How would this

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Speaker 6: market respond to legal challenges in a week's to count?

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Speaker 3: It wouldn't like it because that's more volatility, that's more uncertainty,

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Speaker 3: that's more confusing.

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Speaker 6: Negative.

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Speaker 3: I do think it's negative. I think that at this

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Speaker 3: point the markets would like to see some sort of

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Speaker 3: agreement on where tariffs are going to settle, be able

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Speaker 3: to model them and move on the other thing. I

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Speaker 3: wonder when I listened to Libby, we're talking about Trump

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Speaker 3: having an ideological view about rebalancing trade. I also think

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Speaker 3: he likes the revenue. Now when you listen to him,

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Speaker 3: whatever they're modeling on tariffs, he doesn't want to give

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Speaker 3: that up. And I wonder how sustainable that actually is.

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Speaker 5: So this raises a question, Libby, about what exactly was

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Speaker 5: the point of putting out the tariffs as they did,

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Speaker 5: if they were going to carve out exemptions a couple

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Speaker 5: of days later, and whether this was planned.

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Speaker 7: You always start your letters. I'm going to just sort

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Speaker 7: of give you your cheat sheet what is going on,

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Speaker 7: and then you list things that are going on.

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Speaker 5: You don't have to actually listen anything, and you just

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Speaker 5: say what is going on and send it out.

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Speaker 7: At this point, but ken of a sense of.

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Speaker 5: What exactly led to the shift and the exemptions being

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Speaker 5: announced or was this already planned?

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Speaker 7: Do you have any insight?

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Speaker 4: So I think that this is I mean, I think

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Speaker 4: this is the White House, and we'll say this that

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Speaker 4: the President Trump is his own economic advisor. From our understanding,

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Speaker 4: there were several sort of avenues which he could have explored,

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Speaker 4: or he could have pursued. On Liberation Day, he picked

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Speaker 4: arguably the most draconian, the sort of the most ideological,

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Speaker 4: the most extreme, and I think again sort of the

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Speaker 4: most legally specious. But there were other avenues that he

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Speaker 4: could have pursued. And I think that maybe we're kind

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Speaker 4: of going to one of those other channels.

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Speaker 7: Maybe more moderated.

442
00:20:34,840 --> 00:20:36,800
Speaker 4: And now, of course, I mean what we are economists

443
00:20:36,840 --> 00:20:39,080
Speaker 4: have said is, and what Bob had said earlier, I mean,

444
00:20:39,080 --> 00:20:41,959
Speaker 4: this is still regardless of these you know, even if

445
00:20:42,000 --> 00:20:45,520
Speaker 4: these exemptions hold, this is still an incredibly high effective teriffrate.

446
00:20:45,720 --> 00:20:47,879
Speaker 4: You were looking at effective tariff rate in like a

447
00:20:47,960 --> 00:20:53,120
Speaker 4: twenty percent potentially on all imports. Now, if if imports

448
00:20:53,160 --> 00:20:55,840
Speaker 4: collapse from China, that's effective terraf frate goes down. There's

449
00:20:55,840 --> 00:20:57,879
Speaker 4: obviously a lot of friction from an economic perspective, and

450
00:20:57,920 --> 00:21:01,359
Speaker 4: that does increase recession risk. So we're definitely not out

451
00:21:01,359 --> 00:21:03,560
Speaker 4: of the woods yet. I do think, actually, I think

452
00:21:03,600 --> 00:21:06,679
Speaker 4: a legal challenge would probably be welcomed by the market.

453
00:21:06,720 --> 00:21:08,919
Speaker 4: I mean, I think they would really like that. However,

454
00:21:09,000 --> 00:21:10,959
Speaker 4: and I think this is maybe to Bob's point, is

455
00:21:11,000 --> 00:21:14,600
Speaker 4: that the President has a lot of unilateral authority around tariff.

456
00:21:14,640 --> 00:21:17,119
Speaker 4: So if it's not AIPA, then it's Section one twenty two.

457
00:21:17,520 --> 00:21:18,800
Speaker 4: If it's not, you know, I it's not necessarily it's

458
00:21:18,840 --> 00:21:21,240
Speaker 4: Section three thirty eight of the nineteen thirty ter Effact.

459
00:21:21,680 --> 00:21:24,320
Speaker 4: The point stands is that Congress is basically delegated a

460
00:21:24,320 --> 00:21:26,240
Speaker 4: lot of authority to the White House, and he can

461
00:21:26,320 --> 00:21:28,360
Speaker 4: do a lot without Congress.

462
00:21:28,400 --> 00:21:30,480
Speaker 6: Here, there are a lot of people after the weekend

463
00:21:30,520 --> 00:21:32,000
Speaker 6: looking forward to going into the trading wait to get

464
00:21:32,000 --> 00:21:34,159
Speaker 6: a lib bit long apple after the announcement. So over

465
00:21:34,240 --> 00:21:36,639
Speaker 6: the weekend, get limit long site and video. Can we

466
00:21:36,720 --> 00:21:39,560
Speaker 6: just sit on sectorial tariffs? Now, what's the base case?

467
00:21:39,560 --> 00:21:41,360
Speaker 6: It's the one, Yes, it would base.

468
00:21:41,200 --> 00:21:43,040
Speaker 4: So I would say, you know, our base case is

469
00:21:43,119 --> 00:21:45,760
Speaker 4: a ten percent baseline tariff is here to stay. And

470
00:21:45,760 --> 00:21:48,560
Speaker 4: to Bob's point, they like the revenue associated with that.

471
00:21:48,560 --> 00:21:51,120
Speaker 4: That also sort of fits with the ideology. So ten

472
00:21:51,160 --> 00:21:54,720
Speaker 4: percent universal tariff and then these sector tariffs on semi's,

473
00:21:54,880 --> 00:21:58,640
Speaker 4: on pharma that are forthcoming, on autos, on steel and aluminum,

474
00:21:58,680 --> 00:22:01,120
Speaker 4: and then a higher terra fright on China. I think

475
00:22:01,119 --> 00:22:03,840
Speaker 4: the big question is like how high is that? You know,

476
00:22:03,880 --> 00:22:05,399
Speaker 4: I think my view is probably doesn't stay at one

477
00:22:05,480 --> 00:22:07,760
Speaker 4: hundred and forty five percent. Does it go down to

478
00:22:07,960 --> 00:22:10,800
Speaker 4: thirty forty fifty percent? Obviously this is all speculation, but

479
00:22:10,880 --> 00:22:13,320
Speaker 4: some sort of mix of that is our base case. Again,

480
00:22:13,760 --> 00:22:16,200
Speaker 4: that is a really high effective terror freight that will

481
00:22:16,240 --> 00:22:22,360
Speaker 4: have real economic and inflationary outcomes, but again less draconian

482
00:22:22,400 --> 00:22:23,640
Speaker 4: that what we've seen over the last two weeks.

483
00:22:23,720 --> 00:22:26,199
Speaker 5: Bobby said that markets wouldn't like uncertainty, and if there

484
00:22:26,280 --> 00:22:28,840
Speaker 5: was some sort of legal challenge, it would just prolong

485
00:22:28,920 --> 00:22:32,359
Speaker 5: the uncertainty. Are you talking about bond markets too, given

486
00:22:32,359 --> 00:22:34,040
Speaker 5: the fact that you still think that they have their

487
00:22:34,040 --> 00:22:34,960
Speaker 5: haven status?

488
00:22:35,320 --> 00:22:40,480
Speaker 3: Two words? Doge elon right, that's where we last had

489
00:22:41,119 --> 00:22:46,199
Speaker 3: the legal challenges. Where did that get you? What's happened there? Nothing?

490
00:22:46,280 --> 00:22:46,440
Speaker 1: Well?

491
00:22:46,480 --> 00:22:50,919
Speaker 5: Okay, creative respect to the bond market as enjoying this uncertainty,

492
00:22:50,960 --> 00:22:53,760
Speaker 5: if it's accompanied with some slowdown and growth, if it's

493
00:22:53,760 --> 00:22:54,960
Speaker 5: still cann act as a haven.

494
00:22:56,240 --> 00:22:59,920
Speaker 3: Absolutely, I do think the bond market, the US treasury market,

495
00:23:00,040 --> 00:23:02,760
Speaker 3: it is a haven. The bond market is a haven.

496
00:23:03,200 --> 00:23:07,679
Speaker 3: I think legal challenges will actually push people into the

497
00:23:07,680 --> 00:23:11,719
Speaker 3: bond market. I think we're finishing that wash out process.

498
00:23:12,000 --> 00:23:14,520
Speaker 3: It may continue into the start of this week, but

499
00:23:14,640 --> 00:23:18,359
Speaker 3: I think everything that needed to de lever has largely

500
00:23:18,480 --> 00:23:21,159
Speaker 3: run through that process. I think the bond market's in

501
00:23:21,160 --> 00:23:22,040
Speaker 3: a pretty good spot.

502
00:23:22,240 --> 00:23:24,360
Speaker 6: Big week coming out for fixed incer Bob, thank you, sir,

503
00:23:24,359 --> 00:23:25,800
Speaker 6: you're going to stick with us. A special thanks to

504
00:23:25,800 --> 00:23:28,240
Speaker 6: Libby Cantrell of PIMCO. Libby, thank you, Thank you. If

505
00:23:28,280 --> 00:23:30,240
Speaker 6: you are just joining us, welcome to the program. Equity

506
00:23:30,280 --> 00:23:32,840
Speaker 6: futures right now just about positive. The first few trades

507
00:23:33,359 --> 00:23:35,880
Speaker 6: of the following week, the brand new trading week are

508
00:23:35,920 --> 00:23:38,679
Speaker 6: on and we're positive by zero zero point five percent.

509
00:23:38,760 --> 00:23:40,600
Speaker 6: In just a moment, we'll catch up with Stuart Kaiser

510
00:23:40,760 --> 00:23:43,560
Speaker 6: City and what he calls the least enjoyable five percent

511
00:23:43,640 --> 00:23:46,520
Speaker 6: rally in recent memory. Like from New York. This is

512
00:23:46,520 --> 00:24:14,320
Speaker 6: Bloomberg thirty minutes into the trade in week correctority market

513
00:24:14,320 --> 00:24:17,000
Speaker 6: looks like this. We're positive just about by zero point

514
00:24:17,040 --> 00:24:19,679
Speaker 6: four percent. Maybe not the games are anticipating after the

515
00:24:19,680 --> 00:24:22,800
Speaker 6: headlines around exemptions over the weekend. The nana's that camp

516
00:24:22,880 --> 00:24:25,840
Speaker 6: by zero point eight percent with more let's crossover to

517
00:24:25,880 --> 00:24:26,920
Speaker 6: Danny Berger Hate Danny.

518
00:24:26,960 --> 00:24:29,280
Speaker 10: It may be a market that's trying to trade off headlines.

519
00:24:29,359 --> 00:24:32,040
Speaker 10: John but this could change as we enter the week.

520
00:24:32,040 --> 00:24:34,119
Speaker 10: We're about to get into the thick of the earning season.

521
00:24:34,160 --> 00:24:36,240
Speaker 10: Julian Emmanuel saying, but I think a lot of people

522
00:24:36,280 --> 00:24:39,199
Speaker 10: have said the results don't themselves, don't matter. It is

523
00:24:39,280 --> 00:24:41,639
Speaker 10: the guidance and how they're navigating terrorists. You've already had

524
00:24:41,680 --> 00:24:43,520
Speaker 10: a bit of a hint of that over the past week.

525
00:24:43,560 --> 00:24:46,040
Speaker 10: Of the earnings we've heard from so far, the general

526
00:24:46,080 --> 00:24:48,560
Speaker 10: consensus we've gotten is it seems like every company is

527
00:24:48,600 --> 00:24:51,320
Speaker 10: handling this in a different way. Walmart's saying we can't

528
00:24:51,400 --> 00:24:54,000
Speaker 10: raise our prices. Value is important for our customer. We're

529
00:24:54,000 --> 00:24:56,080
Speaker 10: going to take the short term. Or there's someone like

530
00:24:56,080 --> 00:24:58,520
Speaker 10: a Fastenal saying the map doesn't work, we have to

531
00:24:58,600 --> 00:25:02,399
Speaker 10: raise prices, like a five below this value discount store

532
00:25:02,720 --> 00:25:05,400
Speaker 10: saying that they're just not getting anything from China they're

533
00:25:05,400 --> 00:25:08,160
Speaker 10: pausing all shipments, or some of the European carmakers saying

534
00:25:08,200 --> 00:25:10,720
Speaker 10: we're not going to have exports into the US markets.

535
00:25:10,880 --> 00:25:13,240
Speaker 10: So if one thing that's important is navigating tariffs, the

536
00:25:13,320 --> 00:25:17,399
Speaker 10: other thing is guidance. Again, the consistent thing here is

537
00:25:17,480 --> 00:25:20,920
Speaker 10: no consistency. Delta Frontier, the airlines, we've heard some from

538
00:25:21,000 --> 00:25:23,360
Speaker 10: so far just have completely done away with their guidance,

539
00:25:23,440 --> 00:25:24,879
Speaker 10: saying we don't know what it's going to look like,

540
00:25:24,960 --> 00:25:27,399
Speaker 10: not giving numbers, or you get a car max that

541
00:25:27,440 --> 00:25:30,119
Speaker 10: says we still have these long term goals, but we

542
00:25:30,200 --> 00:25:32,639
Speaker 10: are removing the timeframe for which we think we're going

543
00:25:32,720 --> 00:25:35,320
Speaker 10: to reach them. We also heard from Walmart, which for

544
00:25:35,400 --> 00:25:39,080
Speaker 10: their part, just increase the range of possible estimates, or

545
00:25:39,200 --> 00:25:41,919
Speaker 10: you can do the le Levi's model, which again this

546
00:25:42,080 --> 00:25:45,119
Speaker 10: was an interesting one. They catch their guidance unchanged with

547
00:25:45,119 --> 00:25:48,359
Speaker 10: a big caveat, saying this assumes that nothing changes in

548
00:25:48,400 --> 00:25:51,080
Speaker 10: the macro or consumer environment, and we're going to assemble

549
00:25:51,119 --> 00:25:53,440
Speaker 10: a team to try to figure out exactly what tariffs mean.

550
00:25:53,560 --> 00:25:55,280
Speaker 6: John, Hey, Denny, thank you. I have to say I

551
00:25:55,400 --> 00:25:58,840
Speaker 6: like the Levi's approach. Just say, based on our assumptions,

552
00:25:58,840 --> 00:26:01,120
Speaker 6: things are going to be okay. Assumptions haven't changed since

553
00:26:01,119 --> 00:26:02,080
Speaker 6: the tariff headlines hit.

554
00:26:02,160 --> 00:26:03,680
Speaker 5: And guess what, we've got a task for us that

555
00:26:03,720 --> 00:26:05,320
Speaker 5: they'll handle it, and you know what, we're not going

556
00:26:05,359 --> 00:26:06,159
Speaker 5: to be responsible.

557
00:26:06,320 --> 00:26:07,879
Speaker 6: Good luck to them, sort of finger up in the

558
00:26:07,880 --> 00:26:10,080
Speaker 6: eletronic gates. What you know which try the windskyn and

559
00:26:10,080 --> 00:26:11,000
Speaker 6: what the temperature.

560
00:26:10,640 --> 00:26:12,080
Speaker 5: Is Honestly, I think that a lot of people are

561
00:26:12,080 --> 00:26:14,000
Speaker 5: going to be saying something similar because guess what, this

562
00:26:14,080 --> 00:26:15,840
Speaker 5: is your free ride, So that's what people are.

563
00:26:15,800 --> 00:26:17,880
Speaker 6: Going to do. Sue at Kansra City has this to say.

564
00:26:18,160 --> 00:26:20,680
Speaker 6: This is a case of tail risks reduced or delayed

565
00:26:20,680 --> 00:26:23,600
Speaker 6: as opposed to removed. Stuart joins us now for more

566
00:26:23,640 --> 00:26:26,160
Speaker 6: as he says, good news is needed and quick Stu,

567
00:26:26,200 --> 00:26:28,440
Speaker 6: it's good to see you. How are you get any

568
00:26:28,480 --> 00:26:29,719
Speaker 6: of that good news over a weekend?

569
00:26:29,840 --> 00:26:31,240
Speaker 11: Yeah, I think we got some of it, you know.

570
00:26:31,280 --> 00:26:33,760
Speaker 11: I think the ninety day tariff delay and then you know,

571
00:26:33,760 --> 00:26:36,399
Speaker 11: try to exempt some of the tech stuff is incremental progress.

572
00:26:36,440 --> 00:26:38,200
Speaker 11: I think that stuff trims the tail a little bit,

573
00:26:38,200 --> 00:26:40,399
Speaker 11: but you know they quickly walk back, you know, the

574
00:26:40,440 --> 00:26:42,640
Speaker 11: positive response. If this was a weekday, we probably would

575
00:26:42,640 --> 00:26:43,960
Speaker 11: have had a five percent rally in there to three

576
00:26:43,960 --> 00:26:46,480
Speaker 11: percent so off. Luckily we were closed on Saturday, so

577
00:26:46,520 --> 00:26:47,159
Speaker 11: we didn't get that.

578
00:26:47,920 --> 00:26:48,600
Speaker 6: It's progress.

579
00:26:48,680 --> 00:26:51,000
Speaker 11: I mean, it's either an acknowledgement that they had gone

580
00:26:51,000 --> 00:26:52,679
Speaker 11: too far and or a little bit concerned about you know,

581
00:26:52,760 --> 00:26:55,399
Speaker 11: market functioning, or you know, they're just trying to deliver

582
00:26:55,400 --> 00:26:56,960
Speaker 11: a little bit of good news but without a doubt

583
00:26:56,960 --> 00:26:58,480
Speaker 11: they've trimmed some of the tail off. It's still a

584
00:26:58,480 --> 00:27:00,080
Speaker 11: long tail, but I think they've trimmed a little.

585
00:27:00,200 --> 00:27:02,880
Speaker 6: So went they got thrown around in the past week. Negotiation,

586
00:27:03,200 --> 00:27:05,600
Speaker 6: We got to negotiation. I thinknic guy shame with them.

587
00:27:05,640 --> 00:27:08,400
Speaker 6: Sounds of the moment. You know, it's a little hard

588
00:27:08,440 --> 00:27:08,640
Speaker 6: to say.

589
00:27:08,680 --> 00:27:11,040
Speaker 11: I mean, a lot of trade delegations are supposed to

590
00:27:11,080 --> 00:27:13,840
Speaker 11: supposedly in town and they're talking. It does seem like

591
00:27:13,880 --> 00:27:16,560
Speaker 11: they negotiated themselves on the way up and on the

592
00:27:16,560 --> 00:27:18,800
Speaker 11: way down. China's basically said we're done, you know, with

593
00:27:18,880 --> 00:27:21,240
Speaker 11: the tit for attached stuff. So it does a little

594
00:27:21,240 --> 00:27:24,119
Speaker 11: bit feel like they're kind of responding to shadows and

595
00:27:24,400 --> 00:27:27,080
Speaker 11: to what's going on in markets as opposed to sitting

596
00:27:27,119 --> 00:27:29,600
Speaker 11: out across the table with someone actually you know, triminal numbers.

597
00:27:29,640 --> 00:27:32,080
Speaker 5: Well you say markets, but it seems like they're looking

598
00:27:32,119 --> 00:27:32,840
Speaker 5: at one market.

599
00:27:33,040 --> 00:27:35,240
Speaker 7: It's not your market. Do you feel left out?

600
00:27:35,280 --> 00:27:37,000
Speaker 5: I mean, is there a sense that basically it doesn't

601
00:27:37,040 --> 00:27:39,280
Speaker 5: matter how much stock sell off as long as the

602
00:27:39,280 --> 00:27:41,879
Speaker 5: bond market is stable, that's not going to be a

603
00:27:41,880 --> 00:27:43,399
Speaker 5: limiting factor for this White House.

604
00:27:43,640 --> 00:27:45,440
Speaker 11: Well, we actually got it right this time. Actually, I

605
00:27:45,440 --> 00:27:47,000
Speaker 11: think Lisa, I mean, I remember a couple of weeks

606
00:27:47,040 --> 00:27:48,959
Speaker 11: ago you said, credit s brets have it widened, So

607
00:27:49,000 --> 00:27:52,520
Speaker 11: this equity response is overdone. You know, equities actually moved first,

608
00:27:52,600 --> 00:27:54,600
Speaker 11: so I would say that we were kind of the

609
00:27:54,640 --> 00:27:57,040
Speaker 11: winner of the clubhouse, so to speak, on a master's thing.

610
00:27:57,440 --> 00:27:59,720
Speaker 11: And you know, look, without a doubt, I mean, I

611
00:27:59,720 --> 00:28:02,040
Speaker 11: don't think this is a trump equity put. If there

612
00:28:02,119 --> 00:28:03,919
Speaker 11: is a put, it's associated with the credits or the

613
00:28:04,400 --> 00:28:06,679
Speaker 11: credit or bomb market's full stop. If you look at

614
00:28:06,680 --> 00:28:09,919
Speaker 11: what happened to credit spreads and applied volatility on HyG

615
00:28:10,080 --> 00:28:12,400
Speaker 11: or QD the last couple of weeks, you can see

616
00:28:12,400 --> 00:28:15,119
Speaker 11: that being being very, very aggressively priced. So yeah, I

617
00:28:15,119 --> 00:28:17,399
Speaker 11: would agree. I mean, if it's an equity put, it's

618
00:28:17,440 --> 00:28:18,760
Speaker 11: it's still quite a bit lower than here.

619
00:28:18,800 --> 00:28:20,520
Speaker 5: I would say, well, Bob, do you get the sense

620
00:28:20,600 --> 00:28:23,439
Speaker 5: right now that the bond market truly is king and

621
00:28:23,520 --> 00:28:25,679
Speaker 5: if there is some sort of bid into the bond

622
00:28:25,680 --> 00:28:29,360
Speaker 5: market that could free up to more policy uncertainty, because essentially,

623
00:28:29,600 --> 00:28:32,280
Speaker 5: if that's the only thing that matters, well, if it's calm,

624
00:28:32,400 --> 00:28:33,760
Speaker 5: let's go first.

625
00:28:34,080 --> 00:28:36,800
Speaker 3: Thanks to you for dragging us out with you down

626
00:28:36,880 --> 00:28:37,639
Speaker 3: into the swamp.

627
00:28:38,400 --> 00:28:39,160
Speaker 6: Credit stops.

628
00:28:39,200 --> 00:28:44,200
Speaker 12: The credit was doing great, it was holding in corporate

629
00:28:44,240 --> 00:28:47,959
Speaker 12: profitability looked okay, and there when the equity market and

630
00:28:48,040 --> 00:28:49,640
Speaker 12: credit spreads had to widen.

631
00:28:50,200 --> 00:28:53,240
Speaker 3: I think for us, when we look at how businesses

632
00:28:53,720 --> 00:28:56,360
Speaker 3: are going to respond to the environment, one of the

633
00:28:56,360 --> 00:28:58,800
Speaker 3: things we're looking at is when you get through the

634
00:28:58,920 --> 00:29:04,600
Speaker 3: quiet period, forget about what they're saying about hiring and labor,

635
00:29:04,880 --> 00:29:07,800
Speaker 3: are they actually going to be back in buying their

636
00:29:07,840 --> 00:29:10,800
Speaker 3: shares and does that create some sort of support. If

637
00:29:10,840 --> 00:29:14,320
Speaker 3: that does, then the bond market will follow. Certainly, credit

638
00:29:14,360 --> 00:29:16,440
Speaker 3: spreads will come in ste What do you think?

639
00:29:16,680 --> 00:29:17,360
Speaker 6: I think that's right me.

640
00:29:17,440 --> 00:29:19,880
Speaker 11: You know, Broadcom last week announce a pretty sizable buy back.

641
00:29:20,360 --> 00:29:22,440
Speaker 11: You know, you guys went through you know, case by case.

642
00:29:22,800 --> 00:29:24,680
Speaker 11: You know, you may say I want to go to

643
00:29:24,760 --> 00:29:26,760
Speaker 11: Levi's approach. I would say, look at the Levi's stock

644
00:29:26,760 --> 00:29:28,680
Speaker 11: price that day and tell me if you still want

645
00:29:28,680 --> 00:29:29,640
Speaker 11: to know do that approach?

646
00:29:29,680 --> 00:29:29,880
Speaker 9: It was?

647
00:29:29,920 --> 00:29:30,720
Speaker 6: It was pretty tough.

648
00:29:31,040 --> 00:29:34,240
Speaker 11: So look, I know, it's like we've talked about this

649
00:29:34,280 --> 00:29:36,520
Speaker 11: multiple times. If you're gonna kind of kitchen sink it,

650
00:29:36,560 --> 00:29:38,800
Speaker 11: you're probably going to have a buyback or something announced

651
00:29:38,800 --> 00:29:41,000
Speaker 11: alongside that, you know, to kind of underwrite it a

652
00:29:41,040 --> 00:29:43,760
Speaker 11: little bit. I do think if you say we're good,

653
00:29:44,120 --> 00:29:46,000
Speaker 11: you better have a lot of evidence, and if you

654
00:29:46,120 --> 00:29:48,120
Speaker 11: just pull guidance, I don't think that's the right way

655
00:29:48,120 --> 00:29:48,480
Speaker 11: to go, right.

656
00:29:48,520 --> 00:29:49,960
Speaker 6: What do you think of the approach of the banks

657
00:29:50,120 --> 00:29:51,920
Speaker 6: so far? We get more bank counties for the week,

658
00:29:51,920 --> 00:29:54,120
Speaker 6: We've heard from several players on Friday. What do you

659
00:29:54,120 --> 00:29:54,880
Speaker 6: make of that approach?

660
00:29:55,320 --> 00:29:57,360
Speaker 11: Look, I think bank earnings and looking very early but

661
00:29:57,440 --> 00:29:59,800
Speaker 11: kind of largely is expected. You're in a volatile environment,

662
00:29:59,840 --> 00:30:03,160
Speaker 11: so trading stuff looks good m and a pipeline has

663
00:30:03,160 --> 00:30:04,600
Speaker 11: been kind of kinked, so you're not going to see

664
00:30:04,640 --> 00:30:06,960
Speaker 11: a lot of response there, and obviously by private wealth,

665
00:30:06,960 --> 00:30:09,719
Speaker 11: AUM in a declining equity environment is going to look

666
00:30:09,720 --> 00:30:12,480
Speaker 11: a little lower. So I think the results are as

667
00:30:12,520 --> 00:30:14,400
Speaker 11: you would have expected. They're clearly going to have to

668
00:30:14,440 --> 00:30:16,640
Speaker 11: signal some caution on the loan side of things because

669
00:30:16,640 --> 00:30:18,320
Speaker 11: it would be kind of irresponsible for them not to.

670
00:30:18,440 --> 00:30:21,120
Speaker 11: So it feels like they're kind of managing things, you know,

671
00:30:21,400 --> 00:30:22,520
Speaker 11: about how you would expect.

672
00:30:22,720 --> 00:30:26,280
Speaker 5: So it sounds like earnings matter for everything except for tech.

673
00:30:26,520 --> 00:30:28,680
Speaker 5: And I do wonder at this point if US tech

674
00:30:29,160 --> 00:30:32,280
Speaker 5: is not uninvestable or but just a lot more difficult

675
00:30:32,280 --> 00:30:34,160
Speaker 5: to invest in given the fact that there's been so

676
00:30:34,280 --> 00:30:37,520
Speaker 5: much volatility. They are a beta trade, and they also

677
00:30:37,600 --> 00:30:40,920
Speaker 5: are facing potentially a special focused type of tariff to

678
00:30:40,960 --> 00:30:43,600
Speaker 5: make sure those products get reshort, whatever that means.

679
00:30:43,640 --> 00:30:45,560
Speaker 7: According to Howard Lutnik this weekend.

680
00:30:45,400 --> 00:30:48,080
Speaker 11: Yeah, I mean it's you know, tech earnings are vital obviously,

681
00:30:48,680 --> 00:30:51,360
Speaker 11: you know, I think the risk coming into the year,

682
00:30:51,400 --> 00:30:53,760
Speaker 11: the risk was tech is very expensive and it's extremely

683
00:30:53,760 --> 00:30:55,400
Speaker 11: over owned. I think you would probably say it's not

684
00:30:55,480 --> 00:30:57,560
Speaker 11: quite as expensive and not quite as over owned as

685
00:30:57,600 --> 00:30:59,760
Speaker 11: it was, but there are clearly a cute risks to

686
00:30:59,800 --> 00:31:02,520
Speaker 11: the earning side depending on how the tariffs go. You know,

687
00:31:02,520 --> 00:31:04,440
Speaker 11: I'm a surprised Nazec isn't up a little bit more

688
00:31:04,480 --> 00:31:06,440
Speaker 11: at least on the open. So that's a little bit,

689
00:31:06,520 --> 00:31:08,920
Speaker 11: you know, a little bit troubling perhaps, But look, if

690
00:31:08,920 --> 00:31:10,920
Speaker 11: you saw it last week when the good news came out,

691
00:31:10,960 --> 00:31:14,960
Speaker 11: what worked. Tech stocks bounced, growth stocks bounced. I think

692
00:31:14,960 --> 00:31:17,200
Speaker 11: the ability to get into those stocks at a lower

693
00:31:17,240 --> 00:31:21,280
Speaker 11: valuation is enticing people. And also, what's your other alternative, Like,

694
00:31:21,320 --> 00:31:23,720
Speaker 11: people do not want to buy cyclicals here because they're

695
00:31:23,800 --> 00:31:26,280
Speaker 11: really worried that the next leg of downside would come

696
00:31:26,320 --> 00:31:28,360
Speaker 11: from recession risk. So I think what you're seeing is

697
00:31:28,360 --> 00:31:30,320
Speaker 11: people are trying to stay in large cap tech and

698
00:31:30,320 --> 00:31:33,320
Speaker 11: growth right now. If they're kind of dipping their toes in,

699
00:31:33,480 --> 00:31:35,320
Speaker 11: and I don't know that those toes are that dipped in.

700
00:31:35,480 --> 00:31:37,720
Speaker 6: How when insulates, do you think those tech names are

701
00:31:38,160 --> 00:31:40,800
Speaker 6: from the cycle, from the international cycle, not just a

702
00:31:40,800 --> 00:31:42,880
Speaker 6: domestics story here in the United States.

703
00:31:43,280 --> 00:31:45,320
Speaker 11: Well, I think the question there is if they are

704
00:31:45,320 --> 00:31:48,200
Speaker 11: insulated to some degree, do you get a knock on

705
00:31:48,240 --> 00:31:50,600
Speaker 11: effect into capex and into buybacks? Right Like, if you

706
00:31:50,600 --> 00:31:52,960
Speaker 11: look at buybacks, historically, for instance, you buy back more

707
00:31:53,000 --> 00:31:55,360
Speaker 11: when you're earning more, right So, if you're earning less,

708
00:31:55,360 --> 00:31:57,520
Speaker 11: you're probably going to be buying back lass. There's a

709
00:31:57,560 --> 00:32:00,160
Speaker 11: lot riding on capex guidance from you know three or

710
00:32:00,160 --> 00:32:02,360
Speaker 11: for these big stocks. If you're a little bit worried

711
00:32:02,360 --> 00:32:04,760
Speaker 11: about earnings and foreign demand, you pull back on that.

712
00:32:04,760 --> 00:32:06,960
Speaker 11: CAPPAX and I think those would be your two biggest

713
00:32:07,000 --> 00:32:10,160
Speaker 11: concerns going into tech earnings. What would be from those

714
00:32:10,200 --> 00:32:13,200
Speaker 11: two sources, How do they view their earnings profile going forward?

715
00:32:13,320 --> 00:32:16,240
Speaker 11: How much does that impact their intent to spend both

716
00:32:16,280 --> 00:32:17,960
Speaker 11: on capex and buybacks Related to that.

717
00:32:18,040 --> 00:32:20,200
Speaker 5: I'm glad that you brought up John the cycle, because

718
00:32:20,280 --> 00:32:22,960
Speaker 5: right now this is really the ultimate question. How much

719
00:32:23,040 --> 00:32:25,480
Speaker 5: is the cycle going to get accelerated to the downside

720
00:32:25,480 --> 00:32:28,440
Speaker 5: on a global basis when you have essentially a lot

721
00:32:28,440 --> 00:32:31,200
Speaker 5: of pressure from the tear for the trade war around

722
00:32:31,240 --> 00:32:31,719
Speaker 5: the world.

723
00:32:31,840 --> 00:32:33,360
Speaker 7: And I just wonder at what point.

724
00:32:33,120 --> 00:32:35,160
Speaker 5: We could see that, and Bob, we're going to get

725
00:32:35,160 --> 00:32:38,080
Speaker 5: a host of data this week, like retail sales. Does

726
00:32:38,120 --> 00:32:40,280
Speaker 5: it start to matter at that point to get a

727
00:32:40,320 --> 00:32:42,320
Speaker 5: sense of where we are in the cycle.

728
00:32:43,040 --> 00:32:45,840
Speaker 3: I think it does. I think what is going to

729
00:32:45,880 --> 00:32:49,600
Speaker 3: be interesting is to see if consumers hit a pothole,

730
00:32:50,000 --> 00:32:53,720
Speaker 3: if they have pulled back on spending, if they feel

731
00:32:54,040 --> 00:32:56,600
Speaker 3: that things are uncertain, if they feel that prices are

732
00:32:56,640 --> 00:32:59,560
Speaker 3: going to reset so much higher, they just want to

733
00:32:59,600 --> 00:33:04,000
Speaker 3: stop and say. If they have equity exposure, maybe through

734
00:33:04,440 --> 00:33:07,960
Speaker 3: their retirement plan, and they see that's been reset lower,

735
00:33:08,480 --> 00:33:10,960
Speaker 3: it's not the kind of environment that you want to

736
00:33:11,000 --> 00:33:13,840
Speaker 3: go out and spend. I keep going back to when

737
00:33:13,880 --> 00:33:18,400
Speaker 3: you look at tariffs, it's taxes on businesses and households.

738
00:33:18,560 --> 00:33:21,720
Speaker 3: And I don't remember an economy that taxed its way

739
00:33:21,760 --> 00:33:22,560
Speaker 3: to prosperity.

740
00:33:22,840 --> 00:33:24,760
Speaker 6: No doubts of run Mac just Ryan said, Neil, thanks

741
00:33:24,800 --> 00:33:27,320
Speaker 6: for watching, says the following, I feel like the limit

742
00:33:27,360 --> 00:33:29,560
Speaker 6: of how much Trump can escalate, that part of this

743
00:33:29,760 --> 00:33:32,440
Speaker 6: is over. As the Chinese have rightfully said, it's a

744
00:33:32,480 --> 00:33:33,520
Speaker 6: joke at this point.

745
00:33:33,600 --> 00:33:35,560
Speaker 7: Well, that has been the feeling.

746
00:33:35,720 --> 00:33:38,560
Speaker 5: The question is whether the escalation takes another form, because

747
00:33:38,560 --> 00:33:41,160
Speaker 5: we did see, for example, China putting some.

748
00:33:41,240 --> 00:33:44,000
Speaker 7: Limits on some of the rare Earth's metals.

749
00:33:43,880 --> 00:33:46,080
Speaker 5: Over the weekend. They said this is a good first step.

750
00:33:46,120 --> 00:33:47,800
Speaker 5: Let's see if they still think so given some of

751
00:33:47,840 --> 00:33:50,560
Speaker 5: the other things. And then it's less bad because you're

752
00:33:50,560 --> 00:33:53,000
Speaker 5: taking the tail risk out. But if you have this

753
00:33:53,160 --> 00:33:55,160
Speaker 5: level of escalation for a long time, does it take

754
00:33:55,200 --> 00:33:58,320
Speaker 5: on a different type of contour in the economy?

755
00:33:58,600 --> 00:34:01,000
Speaker 6: Just a final word, Hey, you've taken a conservative approach

756
00:34:01,240 --> 00:34:03,560
Speaker 6: to trade and over the past number of months waiting

757
00:34:03,600 --> 00:34:05,440
Speaker 6: for that data to break, and I remember you saying

758
00:34:05,440 --> 00:34:07,800
Speaker 6: that repeatedly over the last few months. What's the approach

759
00:34:07,840 --> 00:34:10,560
Speaker 6: now into this week, into things like retail sales.

760
00:34:10,719 --> 00:34:12,560
Speaker 11: Look, I mean our view is kind of the the

761
00:34:12,640 --> 00:34:14,640
Speaker 11: risk in the near termor probably tilted a little bit

762
00:34:14,680 --> 00:34:17,040
Speaker 11: to the upside, because if you're going to get good

763
00:34:17,080 --> 00:34:20,239
Speaker 11: news from negotiations. I think that has to happen in

764
00:34:20,239 --> 00:34:21,839
Speaker 11: the next two to four weeks, and if you don't

765
00:34:21,840 --> 00:34:24,439
Speaker 11: get good news on negotiation by then, then to Lisa's point,

766
00:34:24,440 --> 00:34:26,840
Speaker 11: you have to start pricing downside risks to the economy

767
00:34:26,920 --> 00:34:30,120
Speaker 11: via recession. So excuse me if you want to get bullish,

768
00:34:30,360 --> 00:34:32,520
Speaker 11: I think it's actually kind of a tactical trade. If

769
00:34:32,520 --> 00:34:34,120
Speaker 11: we're sitting here six or eight weeks from now and

770
00:34:34,120 --> 00:34:36,640
Speaker 11: they're still like diddling around with negotiations, I think you're

771
00:34:36,640 --> 00:34:38,160
Speaker 11: going to see numbers significantly lower.

772
00:34:38,160 --> 00:34:39,520
Speaker 6: Scott Crohner on our side.

773
00:34:39,280 --> 00:34:41,319
Speaker 11: You know, cut his EPs number to two fifty five

774
00:34:41,360 --> 00:34:43,440
Speaker 11: for the S and P from two seventy, and I

775
00:34:43,440 --> 00:34:46,400
Speaker 11: think you would argue that that's probably pricing in tariffs alone,

776
00:34:46,960 --> 00:34:49,880
Speaker 11: not really a full recession. So it you know, the

777
00:34:50,360 --> 00:34:52,600
Speaker 11: one is the data crack you know, who knows you

778
00:34:52,680 --> 00:34:55,640
Speaker 11: missed on Friday was certainly not encouraging to see sentiment,

779
00:34:55,719 --> 00:34:57,640
Speaker 11: you know, hit in that way, and so I do

780
00:34:57,640 --> 00:34:59,680
Speaker 11: think you're going to need to see like real progress

781
00:34:59,680 --> 00:35:01,080
Speaker 11: in the new next two to three, two to four

782
00:35:01,120 --> 00:35:03,360
Speaker 11: weeks before the market really stars and cut numbers, and.

783
00:35:03,360 --> 00:35:05,520
Speaker 6: Then I'm as Friday with dreadful Curt Gray Moss twat

784
00:35:05,560 --> 00:35:07,640
Speaker 6: Kaiser sits straight. Thank you got to see you. Bob's

785
00:35:07,640 --> 00:35:09,279
Speaker 6: going to stick with us. Let's get you an update

786
00:35:09,280 --> 00:35:11,399
Speaker 6: on stories. Ask where the savening with your Bloomberg brief

787
00:35:11,440 --> 00:35:13,879
Speaker 6: lest crossback cover to Danny Berger, Hey, Danny, Hey John.

788
00:35:13,920 --> 00:35:17,600
Speaker 10: The Trump administration has exempted smartphones and other electronics from

789
00:35:17,600 --> 00:35:20,840
Speaker 10: its so called reciprocal tariffs this past Friday, a major

790
00:35:20,840 --> 00:35:24,560
Speaker 10: reprief for global tech manufacturers like Apple and Nvidia. However,

791
00:35:24,640 --> 00:35:27,480
Speaker 10: officials say that they are still subject to a twenty

792
00:35:27,480 --> 00:35:31,560
Speaker 10: percent levy on China related to fentanol. However, this morning,

793
00:35:31,560 --> 00:35:35,120
Speaker 10: Commerce Secretary Howard Lutnik said that those tariff exemptions will

794
00:35:35,120 --> 00:35:38,080
Speaker 10: be temporary. He said the administration is creating a new

795
00:35:38,160 --> 00:35:41,640
Speaker 10: set of tariffs targeting popular consumer electronics and hopes to

796
00:35:41,680 --> 00:35:44,560
Speaker 10: announce them in the next month or two. Meanwhile, President

797
00:35:44,560 --> 00:35:47,160
Speaker 10: Trump doubled down on coming tech tariffs in a truth

798
00:35:47,280 --> 00:35:52,080
Speaker 10: social post this afternoon. Elsewhere, Minneapolis Fed President Neil Cashkari

799
00:35:52,120 --> 00:35:54,640
Speaker 10: has ruled out a rate cut as an insurance policy

800
00:35:54,640 --> 00:35:58,600
Speaker 10: against an economic slowdown, saying the priority is inflation as

801
00:35:58,600 --> 00:35:59,880
Speaker 10: the labor market looks strong.

802
00:36:00,239 --> 00:36:01,560
Speaker 7: Cash Carr express.

803
00:36:01,280 --> 00:36:05,560
Speaker 10: Confidence that markets will remain orderly despite trade uncertainty. And

804
00:36:05,600 --> 00:36:07,279
Speaker 10: that's your Bloomberg brief, John.

805
00:36:07,160 --> 00:36:10,600
Speaker 6: Danny, thank you, Feed officials. Pramo not blinking here, not

806
00:36:10,640 --> 00:36:11,319
Speaker 6: blinking at all.

807
00:36:11,400 --> 00:36:13,160
Speaker 5: Yeah, I mean some people are trying to hang their

808
00:36:13,160 --> 00:36:15,960
Speaker 5: hat on Susan Collins, but other than that, pretty much

809
00:36:16,000 --> 00:36:17,800
Speaker 5: they're like, look, this market's functioning.

810
00:36:17,960 --> 00:36:19,000
Speaker 7: It doesn't like things.

811
00:36:19,080 --> 00:36:22,359
Speaker 5: It's volatile, but volatility is not breaking, so we've seen

812
00:36:22,360 --> 00:36:23,359
Speaker 5: no problem. Good luck.

813
00:36:23,400 --> 00:36:25,520
Speaker 6: What did the kids say? Not my monkey, not my circus.

814
00:36:25,880 --> 00:36:28,879
Speaker 6: It seems to be the last week.

815
00:36:28,960 --> 00:36:29,920
Speaker 7: Not my bag baby.

816
00:36:30,040 --> 00:36:32,920
Speaker 6: Equity features this evening positive by zero point seven percent.

817
00:36:32,920 --> 00:36:35,560
Speaker 6: I'm next on the programs and final thoughts, heading into

818
00:36:35,600 --> 00:36:37,759
Speaker 6: a brand new trading week line from New York. You're

819
00:36:37,760 --> 00:37:03,919
Speaker 6: watching Bloomberg TV. If you want to just chaining again,

820
00:37:03,960 --> 00:37:06,200
Speaker 6: welcome to the program. We are life, of course, on

821
00:37:06,239 --> 00:37:09,320
Speaker 6: a Sunday evening, once again looking for better news to savening.

822
00:37:09,360 --> 00:37:11,920
Speaker 6: Equity futures are positive by zero point six percent with

823
00:37:11,960 --> 00:37:14,040
Speaker 6: a deeper look at the markets. Let's cross back over

824
00:37:14,120 --> 00:37:15,640
Speaker 6: to Danny Berger for more eye Donny, hey.

825
00:37:15,560 --> 00:37:17,680
Speaker 10: John, We've also had effects markets trading for about the

826
00:37:17,719 --> 00:37:20,279
Speaker 10: past four hours, and if you're hoping for reprieve or

827
00:37:20,280 --> 00:37:22,560
Speaker 10: at least a decisive reprieve for the dollar. Maybe shut

828
00:37:22,600 --> 00:37:25,440
Speaker 10: your screen off and hope for something better tomorrow morning.

829
00:37:25,640 --> 00:37:29,240
Speaker 10: You're looking at a euro which is weaker versus the dollar,

830
00:37:29,360 --> 00:37:31,560
Speaker 10: but it has started to peter out. When the currency

831
00:37:31,719 --> 00:37:34,960
Speaker 10: markets first opened, the euro was weaker versus the dollar

832
00:37:35,000 --> 00:37:38,400
Speaker 10: about three quarters of a percent. But as you've got

833
00:37:38,160 --> 00:37:41,239
Speaker 10: that truth social post for Donald Trump, the dollar then

834
00:37:41,280 --> 00:37:44,480
Speaker 10: again started to lose steam. It's that ominous link between

835
00:37:44,600 --> 00:37:47,360
Speaker 10: risk assets selling off and a weaker dollar that seems

836
00:37:47,400 --> 00:37:50,200
Speaker 10: like it might persist into next week. Speaking of risk assets,

837
00:37:50,239 --> 00:37:53,200
Speaker 10: just a quick look at some other commodity markets this evening.

838
00:37:53,239 --> 00:37:55,960
Speaker 10: You are looking at oil, which opened higher again, unable

839
00:37:56,000 --> 00:37:58,600
Speaker 10: to sustain onto those gains. We're not really seeing anything

840
00:37:58,640 --> 00:38:01,200
Speaker 10: convincing in markets both beauty, IM Brent down about a

841
00:38:01,239 --> 00:38:04,160
Speaker 10: third of one percent. Gold, of course, this hit an

842
00:38:04,239 --> 00:38:07,360
Speaker 10: old time new Hight still is holding about thirty two hundred.

843
00:38:07,560 --> 00:38:09,440
Speaker 10: That's also lower by about half percent.

844
00:38:09,600 --> 00:38:12,160
Speaker 6: John, Hey, Danny, thank you. The most exhausting rally ever

845
00:38:12,440 --> 00:38:14,360
Speaker 6: in a past week. Just think about what we delivered

846
00:38:14,400 --> 00:38:16,160
Speaker 6: again of almost six percent on the S and P

847
00:38:16,280 --> 00:38:19,600
Speaker 6: five hundred. If you ask someone what equities did over

848
00:38:19,640 --> 00:38:21,040
Speaker 6: the last week. Do you think they've come up with

849
00:38:21,080 --> 00:38:22,920
Speaker 6: that the best week of the year. I don't think so.

850
00:38:23,120 --> 00:38:24,680
Speaker 5: I don't think it felt like the best week of

851
00:38:24,680 --> 00:38:26,480
Speaker 5: the year, and I don't think anyone has confidence that

852
00:38:26,520 --> 00:38:27,240
Speaker 5: it's going to stick.

853
00:38:27,280 --> 00:38:30,279
Speaker 7: That said, there is this feeling that we have gained

854
00:38:30,280 --> 00:38:30,680
Speaker 7: a lot back.

855
00:38:30,719 --> 00:38:32,680
Speaker 5: If you said that we had all time highs just

856
00:38:32,719 --> 00:38:34,480
Speaker 5: a couple of weeks ago, I also.

857
00:38:34,280 --> 00:38:35,080
Speaker 7: Wouldn't believe you.

858
00:38:35,320 --> 00:38:38,440
Speaker 5: It feels like such a roller coaster and people are exhausted.

859
00:38:38,520 --> 00:38:40,319
Speaker 6: The all time hig on February nineteenth feels like a

860
00:38:40,360 --> 00:38:40,919
Speaker 6: lifetime ago.

861
00:38:41,000 --> 00:38:42,279
Speaker 7: Right, It was a lifetime ago.

862
00:38:42,400 --> 00:38:44,000
Speaker 6: The most we've seen in the bond market since just

863
00:38:44,040 --> 00:38:46,400
Speaker 6: this week, fifty basis point moved on a ten and

864
00:38:46,440 --> 00:38:49,360
Speaker 6: a thirty, and the dollar was weaker, not stronger. A

865
00:38:49,360 --> 00:38:50,759
Speaker 6: lot to figure out in the week to come, and

866
00:38:50,800 --> 00:38:52,279
Speaker 6: your week to come looks like this. So here's the

867
00:38:52,320 --> 00:38:55,400
Speaker 6: Canada on Monday. Earnings from Goldman on Tuesday, more earnings

868
00:38:55,400 --> 00:38:58,160
Speaker 6: from City Bank for America and United Airlines on Wednesday,

869
00:38:58,440 --> 00:39:00,840
Speaker 6: US retail sales and comments from the feed chat japound

870
00:39:00,880 --> 00:39:03,640
Speaker 6: look out for that Thursday, an ECP right decision and

871
00:39:03,680 --> 00:39:06,080
Speaker 6: another round of jobless claims before wrapping up the training

872
00:39:06,120 --> 00:39:08,600
Speaker 6: week early for the Good Friday holiday, Let's sat down

873
00:39:08,640 --> 00:39:10,960
Speaker 6: to Washington, DC and catsch up with Tala Kendo in

874
00:39:11,000 --> 00:39:14,000
Speaker 6: the nation's capital. Tyler, Let's wrap up the weekend and

875
00:39:14,040 --> 00:39:15,839
Speaker 6: think about what's still to come this week. What are

876
00:39:15,840 --> 00:39:17,799
Speaker 6: you in the tame looking for in the dice to count?

877
00:39:18,640 --> 00:39:20,319
Speaker 2: Yeah, hey, John, Well we could get a better sense

878
00:39:20,320 --> 00:39:22,960
Speaker 2: on how negotiations are going when it comes to the tariffs.

879
00:39:22,960 --> 00:39:26,160
Speaker 2: On Thursday, the Italian Prime Minister will be here at

880
00:39:26,239 --> 00:39:28,799
Speaker 2: the White House as the European Union in particular tries

881
00:39:28,840 --> 00:39:31,480
Speaker 2: to find a path forward here when it comes to negotiations,

882
00:39:31,480 --> 00:39:34,520
Speaker 2: considering that all those countries were tariffed as a block. Now,

883
00:39:34,560 --> 00:39:37,800
Speaker 2: people familiar do tell Bloomberg News that Italian Prime Minister

884
00:39:37,920 --> 00:39:41,480
Speaker 2: Maloney will propose to President Trump eliminating all tariffs on

885
00:39:41,520 --> 00:39:45,040
Speaker 2: bilateral trade between the EU and the US, something actually

886
00:39:45,160 --> 00:39:47,759
Speaker 2: Elon Musk had floated earlier this month. But it really

887
00:39:47,840 --> 00:39:49,879
Speaker 2: remains to be seen if that's something that this White

888
00:39:49,920 --> 00:39:53,040
Speaker 2: House would seriously entertain, or what sort of concessions they

889
00:39:53,040 --> 00:39:55,120
Speaker 2: would need to entertain it. Of course, we hear a

890
00:39:55,160 --> 00:39:57,440
Speaker 2: lot about those non tariff barriers like the VAT and

891
00:39:57,480 --> 00:40:01,480
Speaker 2: digital services taxes, which Italy have. So we'll try to

892
00:40:01,520 --> 00:40:03,680
Speaker 2: see if we can glean any details, particularly when it

893
00:40:03,680 --> 00:40:06,200
Speaker 2: comes to the European Union next week, because john as

894
00:40:06,239 --> 00:40:09,719
Speaker 2: you know, they were supposed to put into retaliatory impacts

895
00:40:09,800 --> 00:40:12,880
Speaker 2: this week but ended up holding off on that reprieve

896
00:40:12,880 --> 00:40:15,520
Speaker 2: once this White House put into effect that ninety.

897
00:40:15,320 --> 00:40:17,680
Speaker 6: Day pause, Tyler, before you go, when can we change

898
00:40:17,719 --> 00:40:21,360
Speaker 6: the conversation from tariffs to taxes? How quickly can we

899
00:40:21,400 --> 00:40:21,920
Speaker 6: achieve that?

900
00:40:23,080 --> 00:40:23,239
Speaker 9: Right?

901
00:40:23,280 --> 00:40:25,160
Speaker 2: So that's one of the big questions here. Of course,

902
00:40:25,239 --> 00:40:27,319
Speaker 2: of both the House and the Senate ended up going

903
00:40:27,320 --> 00:40:30,160
Speaker 2: on recess on Friday after they had passed that critical

904
00:40:30,400 --> 00:40:33,439
Speaker 2: Senate budget blueprint through the House chamber. But there's still

905
00:40:33,480 --> 00:40:36,120
Speaker 2: some big questions here, and trust me, lawmakers are going

906
00:40:36,120 --> 00:40:38,799
Speaker 2: to hear a lot from their constituents, particularly when it

907
00:40:38,800 --> 00:40:40,799
Speaker 2: comes to spending cuts over the next two weeks, and

908
00:40:40,800 --> 00:40:44,080
Speaker 2: that could potentially impact the conversation going forward, because as

909
00:40:44,080 --> 00:40:46,840
Speaker 2: you know, the Senate ended up passing four billion dollars

910
00:40:46,840 --> 00:40:49,359
Speaker 2: in spending cuts, the House plan wanted two trillion. They

911
00:40:49,440 --> 00:40:52,080
Speaker 2: ended up coming together on the pledge from Mike Johnson

912
00:40:52,120 --> 00:40:54,000
Speaker 2: that there will be one point five trillion dollars in

913
00:40:54,040 --> 00:40:56,440
Speaker 2: spending cuts, but that is raising questions about what that

914
00:40:56,520 --> 00:41:00,719
Speaker 2: will mean about the future benefit programs like Medicaid. Lawmakers

915
00:41:00,760 --> 00:41:02,879
Speaker 2: are going to need to come together to figure that out.

916
00:41:03,080 --> 00:41:05,560
Speaker 2: House wants to get their version passed by May. As

917
00:41:05,560 --> 00:41:07,480
Speaker 2: of now, that seems pretty ambitious, but we'll have to

918
00:41:07,480 --> 00:41:09,759
Speaker 2: see as President Trump ramps up the pressure because this

919
00:41:09,800 --> 00:41:13,000
Speaker 2: White House wants to get cashed into consumers pockets and quickly,

920
00:41:13,160 --> 00:41:15,480
Speaker 2: because this is all linked to that tax cut agenda.

921
00:41:15,680 --> 00:41:18,160
Speaker 6: Tonna, thank you, great work. We'll see you early tomorrow morning.

922
00:41:18,160 --> 00:41:19,840
Speaker 6: Thank you very much for some fun of thoughts around

923
00:41:19,840 --> 00:41:22,399
Speaker 6: the table of the savening. Jpmulkin's Bob my cope buff.

924
00:41:22,560 --> 00:41:24,239
Speaker 6: Let's wrap it up. How will you and the tabe

925
00:41:24,239 --> 00:41:25,479
Speaker 6: approach the coming week?

926
00:41:25,960 --> 00:41:29,960
Speaker 3: Well, when I left last Sunday, I was extremely concerned

927
00:41:29,960 --> 00:41:33,520
Speaker 3: about the week, what the week held, and that proved

928
00:41:33,520 --> 00:41:36,120
Speaker 3: to be right. When I leave tonight, I feel much

929
00:41:36,160 --> 00:41:39,640
Speaker 3: more optimistic. I feel that we're in a market that's

930
00:41:39,680 --> 00:41:43,200
Speaker 3: going to be stable. I expect treasury yields to be

931
00:41:43,320 --> 00:41:46,319
Speaker 3: stable and actually drift a bit lower. I think a

932
00:41:46,320 --> 00:41:49,520
Speaker 3: lot of the de leveraging has occurred. When I listened

933
00:41:49,560 --> 00:41:51,719
Speaker 3: to Stu, I think he's right. I think we're in

934
00:41:51,760 --> 00:41:56,040
Speaker 3: the negotiation phase of the tariffs and that will be

935
00:41:56,160 --> 00:41:59,399
Speaker 3: pretty positive for the next couple of weeks. I need

936
00:41:59,440 --> 00:42:02,480
Speaker 3: the equid market to do better, for credit spreads to

937
00:42:02,560 --> 00:42:05,359
Speaker 3: do better. I think that's going to happen. And when

938
00:42:05,360 --> 00:42:07,799
Speaker 3: I think about our client base, I think about the

939
00:42:07,840 --> 00:42:11,120
Speaker 3: pension fund and insurance companies that have been looking for

940
00:42:11,280 --> 00:42:14,480
Speaker 3: a five percent thirty year and wider credit spreads to

941
00:42:14,560 --> 00:42:17,040
Speaker 3: get into this market, They're going to have it. So

942
00:42:17,120 --> 00:42:19,799
Speaker 3: I think this week will be one of stability.

943
00:42:20,040 --> 00:42:21,279
Speaker 7: This week of stability.

944
00:42:21,520 --> 00:42:24,120
Speaker 5: Does it depend at all on any of the granular

945
00:42:24,200 --> 00:42:26,680
Speaker 5: data we get out, whether it's retail sales, whether it's

946
00:42:26,719 --> 00:42:29,600
Speaker 5: the earnings, Well, let's market respond to those things, or

947
00:42:29,680 --> 00:42:32,560
Speaker 5: is it focused squarely on the White House and what

948
00:42:32,640 --> 00:42:33,320
Speaker 5: we hear there.

949
00:42:34,000 --> 00:42:37,240
Speaker 3: I think the data will be overwhelmed by what's going

950
00:42:37,280 --> 00:42:40,919
Speaker 3: on with the trade negotiations. So if there's good news

951
00:42:40,960 --> 00:42:43,880
Speaker 3: that comes out of that, people will dismiss the data.

952
00:42:44,080 --> 00:42:46,200
Speaker 3: If there isn't good news that comes out of that,

953
00:42:46,560 --> 00:42:49,480
Speaker 3: and if we hear more noise out of the administration

954
00:42:50,000 --> 00:42:53,719
Speaker 3: about ever higher tariff levels on all the things that

955
00:42:53,760 --> 00:42:56,640
Speaker 3: haven't been addressed yet, yeah, then the market's not going on, Well,

956
00:42:56,640 --> 00:42:56,920
Speaker 3: what do you.

957
00:42:56,920 --> 00:42:59,800
Speaker 6: Think change the story from when we all last spoke?

958
00:43:00,040 --> 00:43:02,200
Speaker 6: What changed it? Was it the bond market? What was it?

959
00:43:02,800 --> 00:43:07,040
Speaker 3: I think the insane amount of volatility and trading. I

960
00:43:07,040 --> 00:43:11,320
Speaker 3: think the deleveraging that we know occurred throughout the bond market,

961
00:43:11,600 --> 00:43:16,200
Speaker 3: the things that didn't make sense unless they were deleveraging trades.

962
00:43:16,480 --> 00:43:19,760
Speaker 3: And then I think the administration coming in and putting

963
00:43:19,800 --> 00:43:22,200
Speaker 3: in place ninety days of negotia.

964
00:43:21,880 --> 00:43:24,759
Speaker 6: Their response to that. Does that give you confidence that

965
00:43:24,840 --> 00:43:26,600
Speaker 6: you know there is a pain threshold and you can

966
00:43:26,640 --> 00:43:28,120
Speaker 6: identify where it actually is.

967
00:43:29,920 --> 00:43:33,279
Speaker 3: It does give me some level of confidence. And there

968
00:43:33,280 --> 00:43:36,399
Speaker 3: are many other pieces of the puzzle. Talking to our

969
00:43:36,480 --> 00:43:40,839
Speaker 3: non US clients and seeing that they are structural holders

970
00:43:40,880 --> 00:43:44,160
Speaker 3: of US debt and they're going to remain structural holders

971
00:43:44,200 --> 00:43:47,279
Speaker 3: of US debt. All of those are positive things and

972
00:43:47,400 --> 00:43:50,680
Speaker 3: dismiss the narratives that were created out there that have

973
00:43:51,000 --> 00:43:51,759
Speaker 3: no basis.

974
00:43:52,120 --> 00:43:54,719
Speaker 5: There is a quote out on X and thank you,

975
00:43:54,800 --> 00:43:58,240
Speaker 5: Hank Reardan, Hank MF. Reardan, You are a king until

976
00:43:58,239 --> 00:44:00,640
Speaker 5: the bond market takes your sceptor. And this was the

977
00:44:00,680 --> 00:44:03,600
Speaker 5: feeling in Marcus this week and the reason why some

978
00:44:03,640 --> 00:44:07,319
Speaker 5: people are saying that we do have some certainty now,

979
00:44:07,600 --> 00:44:10,760
Speaker 5: Is that there is some response to some market pain

980
00:44:11,160 --> 00:44:14,640
Speaker 5: that this Trump administration will listen to. Is there a

981
00:44:14,760 --> 00:44:17,200
Speaker 5: level of certainty that we have today that we did

982
00:44:17,239 --> 00:44:19,840
Speaker 5: not have last Sunday when we sat here waited for

983
00:44:19,880 --> 00:44:22,319
Speaker 5: futures to open, saw them open, wanted to shut our

984
00:44:22,320 --> 00:44:23,279
Speaker 5: computers and go home.

985
00:44:24,120 --> 00:44:28,120
Speaker 3: Well, it is true that funding pressures on not only

986
00:44:28,200 --> 00:44:32,200
Speaker 3: businesses and households, but also governments can bring people to

987
00:44:32,280 --> 00:44:36,160
Speaker 3: the bargaining table pretty quickly. So that is true. I

988
00:44:36,200 --> 00:44:42,759
Speaker 3: agree with the writer of that. Do I think that

989
00:44:43,400 --> 00:44:48,520
Speaker 3: things are stable and have been resolved? I think they're stable. No,

990
00:44:48,840 --> 00:44:52,000
Speaker 3: they haven't been resolved. Will know that over the course

991
00:44:52,040 --> 00:44:52,600
Speaker 3: of this month.

992
00:44:52,680 --> 00:44:55,120
Speaker 6: Buon Vigilanc's on a new concept. What's newest to see

993
00:44:55,120 --> 00:44:57,319
Speaker 6: this in the treasury market. So I think that's what's

994
00:44:57,320 --> 00:44:59,480
Speaker 6: surprising is something you've talked about for months and months.

995
00:44:59,520 --> 00:45:01,920
Speaker 6: If not yet waiting for that moment, then maybe that

996
00:45:01,920 --> 00:45:04,880
Speaker 6: moment would develop in the treasury market. And to some extent,

997
00:45:04,880 --> 00:45:06,560
Speaker 6: I think you can make the argument it has to

998
00:45:06,680 --> 00:45:09,880
Speaker 6: Bob's point, though, this week's been a really interesting one.

999
00:45:09,960 --> 00:45:11,960
Speaker 6: So you've had the price move and people have attached

1000
00:45:11,960 --> 00:45:15,919
Speaker 6: to it a theory and narrative that international investors are

1001
00:45:16,120 --> 00:45:19,080
Speaker 6: moving away from dollar denominated assets, that it's threatening the

1002
00:45:19,080 --> 00:45:22,320
Speaker 6: safe haven status. The treasury markets will no longer provide

1003
00:45:22,320 --> 00:45:25,600
Speaker 6: what we call on this program, those risk mitigation characteristics.

1004
00:45:26,000 --> 00:45:27,880
Speaker 6: How much longer do you need to really get that

1005
00:45:27,920 --> 00:45:30,840
Speaker 6: definitive answer have you had it already? How much longer

1006
00:45:30,840 --> 00:45:33,359
Speaker 6: do other people need to get that final answer on that,

1007
00:45:33,400 --> 00:45:35,560
Speaker 6: because those are the kind of things that don't happen overnight.

1008
00:45:35,880 --> 00:45:38,960
Speaker 6: They take weeks, months, years, and sometimes they take decades.

1009
00:45:40,000 --> 00:45:43,000
Speaker 3: I think we've seen enough. I think the FED report

1010
00:45:43,080 --> 00:45:47,480
Speaker 3: on Friday showing that there were actual net foreign buyers

1011
00:45:47,640 --> 00:45:51,919
Speaker 3: of treasury securities is one answer to that. I think

1012
00:45:51,920 --> 00:45:54,600
Speaker 3: if that changes down the road, yeah, then I might

1013
00:45:54,680 --> 00:45:57,799
Speaker 3: change my view. But right now, I don't see an

1014
00:45:57,840 --> 00:46:01,839
Speaker 3: alternate reserve currency to the US. I don't see an

1015
00:46:01,880 --> 00:46:06,799
Speaker 3: alternate save haven asset to US treasuries. I can understand

1016
00:46:06,840 --> 00:46:09,560
Speaker 3: the price movements, and actually where we are on ten

1017
00:46:09,640 --> 00:46:12,920
Speaker 3: year treasuries is about the average yield since the start

1018
00:46:12,960 --> 00:46:15,480
Speaker 3: of the year, so there's been a lot of volatility

1019
00:46:15,520 --> 00:46:19,240
Speaker 3: around that. But we've moved a lot and really gone nowhere.

1020
00:46:19,640 --> 00:46:21,719
Speaker 5: You said a couple of months ago, or maybe it

1021
00:46:21,760 --> 00:46:23,879
Speaker 5: was less that you could see this whole yield curve

1022
00:46:23,920 --> 00:46:27,319
Speaker 5: in the US be below three percent, maybe even by

1023
00:46:27,320 --> 00:46:28,080
Speaker 5: the end of this year.

1024
00:46:28,520 --> 00:46:29,440
Speaker 7: Do you still believe that?

1025
00:46:30,760 --> 00:46:34,319
Speaker 3: I do. I think I'm going first off with the

1026
00:46:34,360 --> 00:46:37,680
Speaker 3: FED telling us before all of this their neutral rate

1027
00:46:37,840 --> 00:46:41,520
Speaker 3: was three percent. I'm going with our probability of recession

1028
00:46:41,960 --> 00:46:46,399
Speaker 3: is still above sixty percent, and our expectation is that

1029
00:46:46,800 --> 00:46:51,200
Speaker 3: businesses and households do retrench and do some saving. And

1030
00:46:51,400 --> 00:46:53,880
Speaker 3: I'm going off of a belief that the FED is

1031
00:46:53,920 --> 00:46:58,200
Speaker 3: talking tough now, but when unemployment goes up, they're going

1032
00:46:58,280 --> 00:47:00,960
Speaker 3: to step in and bring down rate a lot. And

1033
00:47:01,040 --> 00:47:04,840
Speaker 3: I think three percent isn't the floor of where they're going.

1034
00:47:05,120 --> 00:47:07,480
Speaker 3: I think that could be the ceiling. We'll see what

1035
00:47:07,560 --> 00:47:09,680
Speaker 3: other policy responses there are.

1036
00:47:09,600 --> 00:47:11,440
Speaker 6: Bob, it's going to see. As always, thanks for doing

1037
00:47:11,480 --> 00:47:13,920
Speaker 6: this again. I appreciate your time. Thank you, Bob. Michael

1038
00:47:13,920 --> 00:47:17,120
Speaker 6: a JP Morgan. Asset management language is important, Bob said,

1039
00:47:17,120 --> 00:47:20,239
Speaker 6: when when unemployment goes up and there's a failing gets

1040
00:47:20,239 --> 00:47:22,000
Speaker 6: when and not if at the moment.

1041
00:47:22,040 --> 00:47:24,960
Speaker 5: If it goes up though later in the year, does

1042
00:47:25,000 --> 00:47:27,880
Speaker 5: the FED have the air cover to respond to quote

1043
00:47:28,080 --> 00:47:30,399
Speaker 5: Mohammad al Arian. But this is the feeling right now,

1044
00:47:30,520 --> 00:47:33,680
Speaker 5: consensus across the street as they ratchet down their expectations.

1045
00:47:33,680 --> 00:47:34,439
Speaker 6: See it's morrow morning.

1046
00:47:35,280 --> 00:47:37,879
Speaker 7: I guess again, this is going to be great.

1047
00:47:37,880 --> 00:47:40,680
Speaker 5: We'll sleep on the under the table. Look, ultimately, this

1048
00:47:40,719 --> 00:47:42,160
Speaker 5: is going to be a tumultuous period.

1049
00:47:42,320 --> 00:47:43,360
Speaker 7: People are exhausted.