WEBVTT - PPI Reaction and Energy Outlook 0:00:00.080 --> 0:00:06.760 Bloomberg Audio Studios, Podcasts, radio news. 0:00:11.960 --> 0:00:15.560 This is the Bloomberg Surveillance Podcast. I'm Tom Keene along 0:00:15.600 --> 0:00:18.960 with Paul Sweeney. Join us each day for insight from 0:00:18.960 --> 0:00:23.119 the best in economics, finance, investment, and international relations. You 0:00:23.160 --> 0:00:26.520 can also watch the show live on YouTube. Visit the 0:00:26.520 --> 0:00:31.280 Bloomberg Podcast channel on YouTube to see the show weekday 0:00:31.280 --> 0:00:34.320 mornings from seven to ten am Eastern from our global 0:00:34.360 --> 0:00:39.000 headquarters in New York City. Subscribe to the podcast on Apple, Spotify, 0:00:39.360 --> 0:00:42.920 or anywhere else you listen and always I'm Bloomberg Radio, 0:00:43.080 --> 0:00:47.480 the Bloomberg Terminal, and the Bloomberg Business App. Jeffrey Curry 0:00:47.560 --> 0:00:51.120 joins US, Professor of price theory at the University of Chicago, 0:00:51.520 --> 0:00:54.720 Acts a small firm downtown. Great interview yesterday, John Farrell, 0:00:54.800 --> 0:00:57.320 mister Solomon. It was like, you know, it was like 0:00:57.360 --> 0:01:01.840 piercing is like you know, I mean, I mean, you 0:01:01.880 --> 0:01:05.399 know Curry Lip Versailles with his energy Now. Yes, Jeff 0:01:05.440 --> 0:01:09.160 Curry joins US now Energy Pathways, the Carlisle groupie roots 0:01:09.160 --> 0:01:13.000 for the Baltimore Orioles. Jeff Copper, I got to rip 0:01:13.080 --> 0:01:14.920 up the script here. We're not doing oil, We're doing 0:01:15.000 --> 0:01:21.360 Copper twenty eleven twenty two, and now another surge way 0:01:21.400 --> 0:01:25.399 out over three standard deviations. What's different this time with 0:01:25.520 --> 0:01:27.119 a surging copper. 0:01:28.720 --> 0:01:31.959 One the investors have finally bought into the view that 0:01:32.319 --> 0:01:35.280 China is not the only game in town for copper. 0:01:35.400 --> 0:01:38.199 That's the main thing is people finally wrapped their heads 0:01:38.240 --> 0:01:41.560 around yes, the property market in China can sync and 0:01:41.640 --> 0:01:45.240 you can still be long copper, and positioning is full 0:01:45.319 --> 0:01:48.160 force right now. And I think that if you look 0:01:48.200 --> 0:01:53.919 at what's different now, it's the willingness of the investor 0:01:54.480 --> 0:01:57.920 to embrace this market despite the fact that there's a 0:01:57.920 --> 0:02:01.320 weak property market. And that's what happened in twenty one 0:02:01.760 --> 0:02:04.520 in those other time periods that you were talking about, 0:02:04.680 --> 0:02:06.920 as people started buying into it, then all of a sudden, 0:02:06.960 --> 0:02:11.240 the property market weakened, They got too scared and you know, 0:02:11.800 --> 0:02:14.040 pulled out of the position. I think there's a couple 0:02:14.160 --> 0:02:17.040 things that make this different. It's one they've now seen 0:02:17.160 --> 0:02:20.560 that copper demand can rise in the face of a 0:02:20.680 --> 0:02:23.440 declining property market. It's up six percent right now in 0:02:23.480 --> 0:02:26.640 a very weak property market. But also they've seen that 0:02:26.680 --> 0:02:30.680 the government's willing to spend infrastructure on green gapbacks, so 0:02:30.760 --> 0:02:31.800 there's a lot different. 0:02:32.000 --> 0:02:37.240 Is there a utility overlay? As we see utility surge 0:02:37.320 --> 0:02:41.040 because of electricity buildout, does copper go up with the 0:02:41.120 --> 0:02:43.240 AI enthusiasm. 0:02:43.680 --> 0:02:47.000 One hundred percent? You know? And you know, I'd like 0:02:47.040 --> 0:02:49.880 to say, you know, AIS, you know, chips and copper. 0:02:49.919 --> 0:02:52.120 You need the chips, but then you need the electrical 0:02:52.160 --> 0:02:54.480 wiring to be able to power those chips. In one 0:02:54.480 --> 0:02:57.840 of those chips, the video chips, the GPUs consume as 0:02:58.000 --> 0:03:01.360 much power as the average American household. So you're gonna 0:03:01.400 --> 0:03:03.640 need a lot of grid connection to be able to 0:03:03.720 --> 0:03:06.880 accommodate that type of growth. And you know what is 0:03:06.880 --> 0:03:11.040 the bottleneck for that? It's copper. So all roads lead 0:03:11.080 --> 0:03:14.720 to copper, whether if it's military, spin, AI, data centers, 0:03:14.840 --> 0:03:16.840 Green Capex, they all point to copper. 0:03:17.040 --> 0:03:19.680 I mean, you couldn't have copper in a million years. 0:03:19.680 --> 0:03:21.040 I would have guessed it. So what do I know? 0:03:21.080 --> 0:03:23.560 But so there's the demand side of the equation. Jeff, 0:03:23.919 --> 0:03:27.240 you just highlighted a number of sources of demand. Can 0:03:27.280 --> 0:03:29.720 you explain to us kind of the supply side of copper. 0:03:29.800 --> 0:03:31.880 I don't know anything about this. Where does copper come from? 0:03:32.080 --> 0:03:32.919 And how's the supply? 0:03:34.320 --> 0:03:37.920 It's one of the last of the good old fashioned commodities. 0:03:37.920 --> 0:03:39.840 You got to dig out of the ground. You know, 0:03:40.000 --> 0:03:44.360 think about oil, with shale manufacturing, aluminum manufacturing. You know, 0:03:44.520 --> 0:03:49.480 you got to go out to very remotely located, geographically 0:03:49.520 --> 0:03:54.960 restricted places like Chile, Peru, the DRC, Mongolia. It's only 0:03:55.040 --> 0:03:58.040 located in a few places around the world, throwing Zombia 0:03:58.240 --> 0:04:01.720 in that and a lot of those places are incredibly 0:04:01.720 --> 0:04:05.400 difficult to get into. Then you got to dig and 0:04:05.680 --> 0:04:08.320 dig deep. Your or grades have come down. It can 0:04:08.360 --> 0:04:11.280 be anywhere from twelve you know, you take you know, 0:04:11.400 --> 0:04:14.440 ivan Ho's big mine in the DRC. It took twenty 0:04:14.520 --> 0:04:17.560 six years to bring online, so you know, there is 0:04:17.640 --> 0:04:21.760 a big commitment to be able to get the supply online, 0:04:21.880 --> 0:04:25.599 and you have strong demand. And everybody's been sleep walking 0:04:25.640 --> 0:04:28.000 into this, even though they've been told about it. You know, 0:04:28.120 --> 0:04:30.799 we started calling copper the new oil back in twenty 0:04:30.839 --> 0:04:34.560 twenty one and it rang on daf ears. You know, 0:04:34.680 --> 0:04:37.120 now it's finally people are perking up to the story. 0:04:37.600 --> 0:04:39.120 But it's going to take years to bring this up. 0:04:39.160 --> 0:04:41.520 I've been medicated. Paul, ask one more question, and then 0:04:41.560 --> 0:04:43.960 I got to do microeconomics with Professor Kurr. 0:04:44.440 --> 0:04:47.279 All right, So while we have you, Jeff here, it 0:04:47.320 --> 0:04:49.880 talked to us about oil here. I mean, I'm looking 0:04:49.920 --> 0:04:52.200 at I like to quote WTI crew to oil. 0:04:52.200 --> 0:04:52.760 I'm an American. 0:04:52.839 --> 0:04:55.040 I love the guys down in Texas and Oklahoma and 0:04:55.080 --> 0:04:57.960 all those crazy people seventy nine dollars a barrel here. 0:04:58.920 --> 0:05:02.320 What's driving oil these days? Is it supply? Is a demand? 0:05:02.440 --> 0:05:03.280 What are you focusing on? 0:05:05.040 --> 0:05:07.919 You know, all the commodities are being driven by the 0:05:07.920 --> 0:05:13.320 same demand for uces. It's late cycle business cycle in 0:05:13.320 --> 0:05:15.800 the sense that you can think of twenty twenty two 0:05:15.800 --> 0:05:18.080 and twenty twenty three as being your classic mid cycle 0:05:18.160 --> 0:05:22.080 pause where your raise rates, higher energy prices, the system 0:05:22.160 --> 0:05:26.679 slowed down, a regathered scheme consolidated around the higher rates, 0:05:26.760 --> 0:05:29.160 and now we're chugging back off into the second half 0:05:29.160 --> 0:05:31.320 of the business cycle. That's when you want to own 0:05:31.400 --> 0:05:34.520 oil and commodities. And it's about the level of demand 0:05:34.680 --> 0:05:37.560 stressing the inability to supply. That's why all of these 0:05:37.560 --> 0:05:39.680 markets are going up. You know, the vast majority of 0:05:39.760 --> 0:05:42.719 them are in backwardation. You know, it's all your typical, 0:05:43.080 --> 0:05:47.800 you know, into cycle type of bullish structure that's playing 0:05:47.839 --> 0:05:50.000 out here. And I don't see this oil being any 0:05:50.040 --> 0:05:51.360 different than copper or some of. 0:05:51.279 --> 0:05:54.440 The base medals. And now folks Drivetime America early in 0:05:54.480 --> 0:05:58.479 the morning, your microeconomics segment, Jeff Curry, we just were 0:05:58.520 --> 0:06:02.400 honored to have Richard portis a giant of English economics 0:06:02.480 --> 0:06:06.560 in London Business School in our and you know, he 0:06:06.640 --> 0:06:08.880 was kind enough to give us a story about studying 0:06:08.960 --> 0:06:12.240 under John Hicks a few years ago. I want to 0:06:12.279 --> 0:06:15.560 talk about going back to copper into China and all 0:06:15.600 --> 0:06:19.560 the emotion, Jeff Curry, is this a shift in demand 0:06:19.880 --> 0:06:24.320 along the curve or an outright shift of the curve 0:06:24.400 --> 0:06:26.040 that has a permanence. 0:06:26.880 --> 0:06:30.480 The outright shift in the curves permanence, and think about 0:06:30.560 --> 0:06:33.600 how much of that's occurred since twenty twenty one? Military 0:06:33.960 --> 0:06:37.159 the military spin, you know, whether if it is munitions 0:06:37.160 --> 0:06:39.240 in the US to the two to ninety five billion 0:06:39.279 --> 0:06:42.760 dollars one hundred billion dollars in places like Germany, and 0:06:42.800 --> 0:06:45.360 then you throw in the AI data centers on top 0:06:45.400 --> 0:06:47.800 of that. That's on all an outward shift in the 0:06:47.839 --> 0:06:50.479 demand curve. So you know that's going to lead to 0:06:50.600 --> 0:06:53.920 structurally higher prices. And I think the question is why 0:06:53.960 --> 0:06:56.960 will it lead to structurally higher prices because somebody's going 0:06:57.040 --> 0:06:59.039 to have to be crowded out here. There's not enough 0:06:59.080 --> 0:07:01.640 supply to go around to everyone, and so we're going 0:07:01.720 --> 0:07:04.080 to find out where demand destruction actually occurs. 0:07:04.279 --> 0:07:08.320 Jeff Curry, thank you so much. That segment of microeconomics 0:07:08.320 --> 0:07:12.560 with Bloomberg Surveillance, brought to you by the George Stiegler Foundation, Chicago. 0:07:12.640 --> 0:07:26.800 Jeff Curry, thank you so much. With Carlisle there squeeze 0:07:26.800 --> 0:07:30.720 a three hour conversation into eight minutes with Adam Posen 0:07:30.960 --> 0:07:35.080 the Peterson Institute. Adam, thank you wonderful to catch up 0:07:35.080 --> 0:07:37.400 with you. And I've got to go to an essay 0:07:37.920 --> 0:07:42.360 off of one of my heroes, Maurice Obsfeld, writing about 0:07:42.400 --> 0:07:48.240 Trump's plan for the FED would revive nineteen seventies style inflation. 0:07:48.760 --> 0:07:51.760 Are we close to returning to the ugly inflation of 0:07:51.800 --> 0:07:52.440 our ute? 0:07:53.680 --> 0:07:56.400 We may be only a year away from our ute? 0:07:56.560 --> 0:08:00.520 Tom joking aside. I think Mariy has it right that 0:08:00.960 --> 0:08:04.440 if they talk about driving down the dollar for reasons 0:08:04.440 --> 0:08:07.520 of a trade episode which doesn't matter, or putting on 0:08:07.680 --> 0:08:11.960 import surcharges, all this Nixon economic policy channeling from the 0:08:12.080 --> 0:08:17.280 early seventies and making the US undependable in global markets 0:08:17.320 --> 0:08:21.440 and in global institutions, that's inflationary. Maria is right, and 0:08:21.480 --> 0:08:23.680 we're going to be following that up for Peterson with 0:08:23.760 --> 0:08:24.320 other studies. 0:08:24.320 --> 0:08:25.880 I want to get this in because Paul's got a 0:08:25.920 --> 0:08:28.640 bunch of questions. I can't say enough about what Fred 0:08:28.640 --> 0:08:32.720 Bergston invented and what Adam Posen has driven forward. Obviously 0:08:32.760 --> 0:08:35.720 Olivier Blanchard there with all of his good work, But 0:08:35.800 --> 0:08:38.439 there's a guy that wrote a paper that was hugely 0:08:38.520 --> 0:08:42.840 influential for me decades ago. His name is William Klein, 0:08:43.640 --> 0:08:52.199 and his basic message, folks, was stop worrying about China, US, Japan, US, Australia, US, 0:08:52.440 --> 0:08:56.600 in that it's a diffuse system of currency movements off 0:08:56.640 --> 0:09:01.160 of William Klein Adam Posen. As we ax about Japan 0:09:01.520 --> 0:09:05.880 and their depreciation or devaluation, how does it diffuse in 0:09:05.920 --> 0:09:08.960 a William Klein way across a Pacific. 0:09:08.600 --> 0:09:12.240 Rim Well, I think what Bill Klin was saying years 0:09:12.240 --> 0:09:15.440 ago is even more true now. The dollar is dominant 0:09:15.440 --> 0:09:18.600 in reserves, the dollar is dominant for so many things, 0:09:18.880 --> 0:09:21.920 but in terms of the effect of any bilateral exchange 0:09:21.960 --> 0:09:25.280 weight on real outcomes, it's very small. For anyone who's 0:09:25.360 --> 0:09:29.640 not the US. I mean putting it this day. Sorry 0:09:29.679 --> 0:09:32.640 I phrase that badly. But if Japan depreciates by a 0:09:32.720 --> 0:09:36.640 huge amount, which there's no particular reason it should, then 0:09:37.200 --> 0:09:39.520 it actually doesn't matter that much to the US. What 0:09:39.720 --> 0:09:43.920 starts causing concern is in a situation like now, where 0:09:43.960 --> 0:09:48.280 the FED is tipped to keep hiking potentially, where US 0:09:48.360 --> 0:09:53.120 growth is tipped to outperform potentially, and Europe, Japan, China, 0:09:53.840 --> 0:09:58.679 others are all go lower, then you've got an overall 0:09:59.000 --> 0:10:01.520 appreciation of the And that's a different story. 0:10:01.600 --> 0:10:03.960 I bring this up, Paul. It's so crucial because the 0:10:04.040 --> 0:10:08.600 media is so fixated on US this, US that, and 0:10:08.640 --> 0:10:12.280 it's a much more complex economics than what's portrayed in 0:10:12.280 --> 0:10:13.040 the modern media. 0:10:13.160 --> 0:10:14.400 Paul, Adam. 0:10:14.600 --> 0:10:17.360 We had this PPI data today, Adam came in, you know, 0:10:17.480 --> 0:10:20.040 hotter than expected, which is kind of goes to that 0:10:20.120 --> 0:10:22.640 narrative that inflation is not whipped. 0:10:22.679 --> 0:10:23.880 Inflation is still out there. 0:10:23.880 --> 0:10:27.360 How do you think about inflation in this US economy 0:10:27.360 --> 0:10:28.079 these days? 0:10:28.720 --> 0:10:32.040 Well, Paul, I've been and you've heard had me on before. 0:10:32.160 --> 0:10:35.680 I've been in the camp suggesting that the inflation was 0:10:35.720 --> 0:10:38.680 going to be moving sideways on a multi month average 0:10:38.800 --> 0:10:41.880 this year, once you got down into the low threes, 0:10:41.920 --> 0:10:45.440 and that's what's happening. One month's PPI one way or 0:10:45.440 --> 0:10:49.600 the other doesn't really tell you anything. More importantly, the 0:10:49.600 --> 0:10:52.360 Fed needs to talk about what its forecast is and 0:10:52.400 --> 0:10:56.000 what its goals are. And but for people trying to 0:10:56.000 --> 0:11:00.079 assess inflation, yeah, we're stuck it around three percent inflation. 0:11:00.320 --> 0:11:03.800 I would expect headline CPI to go down a bit 0:11:03.880 --> 0:11:05.720 more in the next few months and then come back 0:11:05.800 --> 0:11:06.280 up a bit. 0:11:07.000 --> 0:11:10.720 So given that backdrop, Adam, what do you think our 0:11:10.760 --> 0:11:13.800 Federal Reserve should do over the. 0:11:13.679 --> 0:11:15.960 Coming months here as we head into an election. 0:11:16.920 --> 0:11:19.800 I think they should hold off on any rate cuts 0:11:19.840 --> 0:11:23.320 until at least November, barring something strange happening like a 0:11:23.360 --> 0:11:27.280 financial problem or a cratering of the really Connie, which 0:11:27.280 --> 0:11:30.960 I find extremely unlikely. I think they should be prepared 0:11:31.000 --> 0:11:34.400 and laying the groundwork for raising rates in twenty twenty five. 0:11:34.920 --> 0:11:37.160 And I think they should be looking at and arguably 0:11:37.280 --> 0:11:40.480 talking about the fact that either they're going to change 0:11:40.480 --> 0:11:42.640 the inflation target and move it up, or if they 0:11:42.640 --> 0:11:44.680 don't want to do that, they need to explain why 0:11:44.679 --> 0:11:47.880 they're comfortable with inflation staying around where it is for 0:11:47.920 --> 0:11:51.200 a while. They can't just keep hoping that someday they'll 0:11:51.200 --> 0:11:53.559 get to change the target. But they don't have to 0:11:53.600 --> 0:11:54.400 talk about. 0:11:54.160 --> 0:11:57.880 It now, So all right, Adam. So one of the 0:11:57.920 --> 0:12:00.120 key drivers, obviously for the Federal Reserve is just. 0:12:00.120 --> 0:12:01.040 The US consumer. 0:12:01.320 --> 0:12:03.360 Here. We had some home depot results today that were 0:12:03.880 --> 0:12:07.000 a little bit weaker than expected. Of course, we'll hear 0:12:07.040 --> 0:12:11.240 from Walmart tomorrow Thursday after the Thursday with their earnings. 0:12:11.640 --> 0:12:14.080 How do you view the US consumer here? 0:12:15.160 --> 0:12:18.160 I mean, the US consumer is continuing to be quite strong. 0:12:18.200 --> 0:12:21.000 The idea that it's tapering off some versus a year 0:12:21.040 --> 0:12:24.680 ago is not a surprise, given the real income growth 0:12:24.679 --> 0:12:27.760 hasn't been that high, and that people are saving less now. 0:12:28.280 --> 0:12:30.960 So we're coming to a point at which US households 0:12:31.000 --> 0:12:34.920 are probably on average, not going to keep decreasing their savings, 0:12:35.000 --> 0:12:38.960 right and so fine, But the Fed isn't supposed to 0:12:39.000 --> 0:12:43.520 be trying to fine tune the economy, to use an 0:12:43.520 --> 0:12:47.760 old phrase, to we'll recognize and so a little bit 0:12:47.800 --> 0:12:49.959 of slow down in consumption is okay. 0:12:51.400 --> 0:12:53.240 You know, I look at them posing at the real 0:12:53.360 --> 0:12:55.040 yield here, and I think we need to frame it 0:12:55.080 --> 0:12:58.439 with a nominal GDP. The great miscall of the last 0:12:58.480 --> 0:13:01.640 twenty four months. Maybe posts and Bluntchard wrote about this 0:13:01.920 --> 0:13:06.160 are brilliantly calling the third stimulus the Biden stimulus. We've 0:13:06.200 --> 0:13:11.840 all misjudged real GDP, and certainly we've all misjudged nominal 0:13:12.240 --> 0:13:15.920 GDP with a sustained inflation that we've had. You have 0:13:15.960 --> 0:13:21.000 in your head where the real yield needs to migrate 0:13:21.040 --> 0:13:25.480 to to assist business, to assist a belieged housing market. 0:13:25.760 --> 0:13:27.720 Where does a real yield need get to head? 0:13:28.840 --> 0:13:31.320 I think the real yield needs to head where it 0:13:31.360 --> 0:13:34.480 has to hit irrespective of business, and then we'll get 0:13:34.520 --> 0:13:38.120 to and that is flat to up. I think our star, 0:13:38.320 --> 0:13:41.600 the neutral interest rate is going up because we've got 0:13:42.000 --> 0:13:47.800 productivity rising, we've got risk aversion down, we've got division 0:13:48.200 --> 0:13:51.559 in the world with China so less capital inflowing here, 0:13:52.120 --> 0:13:55.920 we've got growth prospects up, we've got fiscal discipline. 0:13:56.120 --> 0:13:58.679 Okay, I got to rip up the scripture because we 0:13:58.800 --> 0:14:00.800 just got time. This is so because we just had 0:14:00.840 --> 0:14:04.120 Vice chair McClaren in here as well, and he agrees 0:14:04.200 --> 0:14:07.240 with that. Imposing that there's a new hour start. How 0:14:07.280 --> 0:14:11.839 do you presume the messaging of the FED teaches us 0:14:12.000 --> 0:14:13.600 that two percent is history. 0:14:15.520 --> 0:14:18.839 So the way they're doing it for now is Paul 0:14:18.920 --> 0:14:21.400 and a couple others are starting to sort of float 0:14:21.440 --> 0:14:24.440 the idea that maybe our star is up for good 0:14:24.440 --> 0:14:28.160 and bad reason. It's mostly good, they claim, And they 0:14:28.200 --> 0:14:31.640 start redoing the dots every couple months, every few months, 0:14:31.640 --> 0:14:34.160 and time, moving up bit by bet that ten year 0:14:34.280 --> 0:14:38.520 projection in your raid projection. But I think it would 0:14:38.560 --> 0:14:42.480 be helpful for them to talk more bluntly about why 0:14:42.560 --> 0:14:45.920 our star might be up, and if our star is up, 0:14:45.960 --> 0:14:50.480 how far that would be. And then additionally they then 0:14:50.560 --> 0:14:53.200 have to confront the fact that if our star is up, 0:14:53.320 --> 0:14:55.960 then their policy isn't as tight as they think it is. 0:14:56.080 --> 0:14:59.720 Have we ever done this before? Have we ever job boned. 0:14:59.480 --> 0:15:02.960 Two point as it was flight of hand in the 0:15:03.040 --> 0:15:08.080 late nineties, didn't really admit it right, So no, there 0:15:08.080 --> 0:15:11.480 hasn't been a public situation because once Bernanki comes in 0:15:11.520 --> 0:15:15.560 and starts talking transparent exactly our stars on the week. 0:15:15.440 --> 0:15:18.080 It Adam, is it Old Testament or New Testament? I mean, 0:15:18.720 --> 0:15:22.200 what's a gospel here? And I don't know, We've never 0:15:22.280 --> 0:15:24.280 done this before, have we? Doctor Posen? 0:15:25.600 --> 0:15:30.200 Probably not doctor Keane, but the fact for means that 0:15:30.280 --> 0:15:33.080 it has to be done. If the Fed just keeps 0:15:33.120 --> 0:15:37.760 telling people that policy is close to write or or tight, 0:15:38.280 --> 0:15:41.240 when financial conditions are loose and our star is rising, 0:15:41.280 --> 0:15:44.200 we're gonna end up with a mistake or a huge surprise, 0:15:44.320 --> 0:15:44.960 one or the other. 0:15:45.480 --> 0:15:49.080 Adam, thank you, Adam posing a Peterson Institute. I can't 0:15:49.480 --> 0:15:56.760 say enough about the importance of their website. Why are 0:15:56.840 --> 0:15:58.440 you one far away? He was at a bank in 0:15:58.520 --> 0:16:02.560 little Rocket, He was daytrich The means the mean stocks 0:16:03.360 --> 0:16:05.120 just we don't have time for this. Joining us in 0:16:05.200 --> 0:16:08.280 studio Congressman Hill of Arkansas, who is one of the 0:16:08.360 --> 0:16:12.840 same voices. Whatever your politics in Washington, the arch matter 0:16:12.920 --> 0:16:16.960 here is Gensler do something. Is it healthy in America 0:16:17.000 --> 0:16:21.680 to have day trading of these stocks? Like Reminiscence of 0:16:21.680 --> 0:16:24.000 a stock Operator in nineteen twenty three. 0:16:24.640 --> 0:16:26.520 You know, Tom's good to be with you and Paul 0:16:26.800 --> 0:16:29.200 when we had this first come up and we had 0:16:29.520 --> 0:16:34.040 Roaring Kitty at his height, I asked, the question, is 0:16:34.240 --> 0:16:36.520 the bulletin bar when you subscribe to a bulletin bar 0:16:36.600 --> 0:16:38.960 on Reddit and people put information out there, is that 0:16:39.040 --> 0:16:42.720 stock research? Is that a recommendation is that is that 0:16:42.840 --> 0:16:45.160 evidence of front running? And I never got an answer 0:16:45.240 --> 0:16:46.320 from the SEC on that. 0:16:46.600 --> 0:16:48.960 Okay, I've got to turn We got got a long 0:16:49.000 --> 0:16:52.200 agenda to talk. It's a two hour interview. Margaret Brennan 0:16:52.200 --> 0:16:57.240 would make it three hours. French Hill in Arkansas. There 0:16:57.320 --> 0:17:02.480 is the idea of terraff of China saying we don't 0:17:02.520 --> 0:17:07.640 want your chicken, or China doesn't want Brazilian chicken. They 0:17:07.680 --> 0:17:12.200 have teriffs that discourage the import of Tyson's Food chicken, 0:17:12.359 --> 0:17:16.400 Arkansas chicken into China. So we're going to turn around 0:17:16.440 --> 0:17:19.800 into one hundred percent tariff on an ev that we 0:17:19.840 --> 0:17:22.720 won't let into the country as well. You're not in 0:17:22.720 --> 0:17:23.600 a swing state. 0:17:23.760 --> 0:17:26.560 Explain this, boy, that's such a good question. This is 0:17:26.600 --> 0:17:28.479 so concerning to me that when we get into this 0:17:28.520 --> 0:17:31.000 across the board tariff approach by either the Biden or 0:17:31.080 --> 0:17:34.600 Trump administration, we recognize that we have an economy that 0:17:34.640 --> 0:17:38.119 we're deeply integrated with China, and the United States have 0:17:38.200 --> 0:17:41.240 deeply integrated economy, so as to use tariff policy really 0:17:41.320 --> 0:17:44.960 backfires ultimately on both countries. I think you're much better 0:17:45.000 --> 0:17:50.119 identifying the technologies you have concerns about in foreign direct 0:17:50.160 --> 0:17:53.200 investment in China and then handle it that way. 0:17:53.320 --> 0:17:57.440 Paul, I remember years ago a lunch where senior officer 0:17:57.480 --> 0:18:00.480 of Tyson's Food explained to me that they figured out 0:18:00.480 --> 0:18:02.560 where they could send the dark meat, and they would 0:18:02.600 --> 0:18:05.199 send the dark meat to China. It's old news. But 0:18:05.320 --> 0:18:08.960 the answer is is the congresstance says, we have relationships 0:18:08.960 --> 0:18:10.400 across many commodities. 0:18:10.440 --> 0:18:13.840 Beaks and claws, beaks and claus go to China. 0:18:13.920 --> 0:18:14.360 Is that right? 0:18:14.480 --> 0:18:14.840 Yes? 0:18:15.400 --> 0:18:18.719 How big is tyson Foods in Arkansas? 0:18:18.880 --> 0:18:23.000 Well, it's one of our biggest corporate partners because Walmart, 0:18:23.040 --> 0:18:26.400 Ties and food Ja behind are three big Northwest Arkansas 0:18:26.440 --> 0:18:29.359 anchor enterprises and their global reach. 0:18:29.480 --> 0:18:32.360 Yeah, it's just extreme. So it is an election year. 0:18:32.520 --> 0:18:35.000 What does that mean for the day to day workings 0:18:35.119 --> 0:18:35.760 of Congress? 0:18:35.800 --> 0:18:37.600 Do you guys have it? I assume you have a 0:18:37.640 --> 0:18:40.159 to do list? How does that impact it? 0:18:40.200 --> 0:18:42.280 By the fact that a lot of it's an election 0:18:42.720 --> 0:18:44.320 year and there's a lot of noise in Washington. 0:18:44.359 --> 0:18:45.960 Well, a couple of weeks ago, Mike Johnson got to 0:18:45.960 --> 0:18:50.159 celebrate his first day as speaker because after passing the Ukraine, 0:18:50.240 --> 0:18:54.280 Israel and Taiwan package, the Foreign Intelligence Surveillance Act, reform 0:18:54.400 --> 0:18:57.159 and reauthorization, and twenty four spending. Those were all things 0:18:57.240 --> 0:18:59.800 we were supposed to do in twenty twenty three. So 0:19:00.160 --> 0:19:02.920 having cleared the decks of those, Paul, I think you'll 0:19:02.960 --> 0:19:05.200 see us move into a campaign mode, which is really 0:19:05.240 --> 0:19:08.160 messaging bills to show the sharp contrast between the Biden 0:19:08.160 --> 0:19:11.120 administration and how Republicans would govern. But there are things 0:19:11.119 --> 0:19:13.720 we have to do. A Farm Bill every five years, 0:19:13.760 --> 0:19:15.560 we authorize the agriculture programs. 0:19:15.600 --> 0:19:15.959 That's up. 0:19:15.960 --> 0:19:17.919 I expect to see that be marked up in the 0:19:17.920 --> 0:19:21.639 House Ad Committee this month, National Defense Authorization Committee, and 0:19:21.680 --> 0:19:25.280 then of course the most important is debating fiscal twenty 0:19:25.320 --> 0:19:27.400 five spending. So those are all on the plate even 0:19:27.480 --> 0:19:28.440 during an election year. 0:19:28.560 --> 0:19:31.119 And of course we have geopolitical issues all over the 0:19:31.160 --> 0:19:35.040 world that has everyone's attention. What's your current thinking or 0:19:35.080 --> 0:19:38.000 what's the current thinking within your house as to what's 0:19:38.000 --> 0:19:40.520 going on in the Middle East and our policy towards Israel, 0:19:40.720 --> 0:19:42.280 policy towards that whole situation. 0:19:42.840 --> 0:19:44.800 Well, our policy towards the Middle East, I think has 0:19:44.840 --> 0:19:47.960 been off track as the Biden administration has really taken 0:19:47.960 --> 0:19:50.560 a page out of the Obama administration, which was to 0:19:50.560 --> 0:19:53.080 coddle Iran. And when you look at this, Iran is 0:19:53.119 --> 0:19:55.840 a partner and everything bad going on in the world today, 0:19:56.359 --> 0:20:00.679 including the invasion of Hamas from Gaza into Israel, and 0:20:00.720 --> 0:20:02.720 they're at the heart of it. And we freed up money, 0:20:02.720 --> 0:20:05.480 we freed them up from sanctions all under the Biden administration. 0:20:06.160 --> 0:20:09.440 House Republicans and a large portion of House Democrats opposed 0:20:09.440 --> 0:20:11.800 that policy. And I think it's at the heart of 0:20:11.880 --> 0:20:16.639 rearming Russia in Ukraine, partnering with China because China buys 0:20:16.960 --> 0:20:21.080 eighty or ninety percent of energy from Iran and therefore 0:20:21.119 --> 0:20:23.919 sending them money, and then they're arming the Houthis that 0:20:24.000 --> 0:20:26.720 have disrupted rid sea trade. So at the heart of 0:20:26.760 --> 0:20:29.160 this axis new access of evil, I think you find 0:20:29.160 --> 0:20:30.240 iron at every step. 0:20:30.840 --> 0:20:34.720 Is there a politeness in Congress right now? Things improved 0:20:34.760 --> 0:20:36.600 from the madness of twelve months ago. 0:20:37.520 --> 0:20:40.480 Well, we have people who are performance artists in Congress, 0:20:40.520 --> 0:20:42.240 and then we have people who are there to help 0:20:42.280 --> 0:20:45.720 govern and drive the agenda and counter the Biden agenda 0:20:45.760 --> 0:20:46.320 if you're rou now. 0:20:46.320 --> 0:20:48.919 But the performance artist just had a boofest. It sounded 0:20:48.960 --> 0:20:52.080 like the British, sounded like Parliament for a way, So 0:20:52.240 --> 0:20:54.639 is there a sea change here. Maybe I think people. 0:20:54.920 --> 0:20:58.480 Look, I think Republicans in Congress want Mike Johnson to 0:20:58.520 --> 0:21:00.879 continue in the speakership. He's doing a good job. And 0:21:00.960 --> 0:21:03.240 let's get through the as you say, Paul, the national 0:21:03.280 --> 0:21:05.679 election in November, let's focus on that. Let's have a 0:21:05.720 --> 0:21:09.120 contrast between what Republicans would do if we expanded our 0:21:09.160 --> 0:21:11.960 majority of the House, took the Senate with or without 0:21:11.960 --> 0:21:14.000 a Biden presidency. I think that's what we should be 0:21:14.040 --> 0:21:14.520 focused on. 0:21:14.720 --> 0:21:16.760 Okay, and we got a problem here. First of all, 0:21:16.760 --> 0:21:20.679 we got Purdue October twenty eighth, and you know, we 0:21:20.760 --> 0:21:24.399 got the Red White Showcase October fourth. But this year 0:21:25.320 --> 0:21:29.760 Arkansas basketball has a different character to it as well. 0:21:30.119 --> 0:21:33.520 They're popping seven million dollars to the guy from Kentucky. 0:21:33.600 --> 0:21:37.320 I mean, Arkansas's playing large year. What's the impact of 0:21:37.440 --> 0:21:42.040 John Calapari coming down and changing Arkansas athletics. 0:21:42.080 --> 0:21:43.960 Well, we're fired up to have him, and we're glad 0:21:43.960 --> 0:21:46.360 he's going to keep his shirt on. Our previous coach 0:21:46.400 --> 0:21:48.440 would always rip his shirt off when we had a victory, 0:21:48.480 --> 0:21:50.720 didn't have enough victories. But we're glad to have him, 0:21:50.760 --> 0:21:52.720