1 00:00:00,160 --> 00:00:03,360 Speaker 1: This is Bloomberg Wall Street Week. What's the state of 2 00:00:03,400 --> 00:00:06,360 Speaker 1: corporate governments? The deficit is a real issue. The US 3 00:00:06,400 --> 00:00:09,760 Speaker 1: economy continues to send mixed signals to the financial stories 4 00:00:09,800 --> 00:00:12,680 Speaker 1: that cheap our world fed action to con concerns over 5 00:00:12,760 --> 00:00:16,239 Speaker 1: dollar liquidity and encouraging China data. The five hundred wealthiest 6 00:00:16,239 --> 00:00:18,360 Speaker 1: people in the world. Through the eyes of the most 7 00:00:18,480 --> 00:00:22,520 Speaker 1: influential voices Larry Summers, the former Treasury Secretary, Start CEO, 8 00:00:22,640 --> 00:00:26,360 Speaker 1: Kevin Johnson sec Chairman j Clayton. Bloomberg wool Street Week 9 00:00:26,480 --> 00:00:30,600 Speaker 1: with David Weston from Bloomberg Radio. The American economy starts 10 00:00:30,640 --> 00:00:34,400 Speaker 1: to open its doors, but are consumers ready to come back? 11 00:00:35,000 --> 00:00:38,280 Speaker 1: This is Bloomberg Wall Street Week. I'm David Weston. Every 12 00:00:38,320 --> 00:00:40,680 Speaker 1: state in the Union opened its doors this week, at 13 00:00:40,760 --> 00:00:43,280 Speaker 1: least a little bit, and the markets held their breath 14 00:00:43,320 --> 00:00:45,840 Speaker 1: to see whether the consumers felt comfortable off to come 15 00:00:45,880 --> 00:00:50,680 Speaker 1: back outside. The numbers of cases were down, testing was up, 16 00:00:51,000 --> 00:00:54,320 Speaker 1: and there was even talk of a possible vaccine. But 17 00:00:54,680 --> 00:00:57,800 Speaker 1: is this an indication of a true pivot toward recovery 18 00:00:57,880 --> 00:01:01,080 Speaker 1: or are we just wishing ourselves to success us One 19 00:01:01,120 --> 00:01:04,240 Speaker 1: thing that everyone could agree on, the answer the question 20 00:01:04,440 --> 00:01:07,640 Speaker 1: lies with the consumer, and so in the end, it's 21 00:01:07,680 --> 00:01:10,240 Speaker 1: not an economic question at all. It's a question of 22 00:01:10,280 --> 00:01:13,959 Speaker 1: public health and whether people feel safe enough to re 23 00:01:14,160 --> 00:01:18,479 Speaker 1: enter the marketplace. Former Goldman Sachs chairman and CEO Lloyd 24 00:01:18,480 --> 00:01:21,720 Speaker 1: blank Find has spent a career assessing and managing risk, 25 00:01:22,080 --> 00:01:24,280 Speaker 1: and he says that there is health risk to be 26 00:01:24,319 --> 00:01:29,240 Speaker 1: incurred whenever we open the economy. It's not whether it's when, Well, 27 00:01:29,360 --> 00:01:34,200 Speaker 1: there's a there's a lot that's unknown and unknowable, and moreover, 28 00:01:34,319 --> 00:01:36,360 Speaker 1: I know that no one knows, and so that's a 29 00:01:36,480 --> 00:01:38,319 Speaker 1: that's an aspect of this because you can dig and 30 00:01:38,360 --> 00:01:42,559 Speaker 1: dig and dig. But basically, I think with this current moment, 31 00:01:42,959 --> 00:01:45,680 Speaker 1: we're not so much in the realm of forecasting. I 32 00:01:45,680 --> 00:01:48,680 Speaker 1: think we're in the realm of contingency planning. And I 33 00:01:48,680 --> 00:01:51,800 Speaker 1: think one of those contingentis you have to plan for, is, 34 00:01:51,880 --> 00:01:54,360 Speaker 1: you know, the surprise. Most of the time in my 35 00:01:54,480 --> 00:01:59,280 Speaker 1: in my former life, surprises were almost always bad surprises. 36 00:01:59,360 --> 00:02:01,760 Speaker 1: Something would go wrong, and of course we were so 37 00:02:01,800 --> 00:02:04,240 Speaker 1: big and extensive. There's nothing that could go wrong anywhere 38 00:02:04,280 --> 00:02:07,120 Speaker 1: in the world that wouldn't affect us um. But I 39 00:02:07,120 --> 00:02:09,079 Speaker 1: would say, in this particular moment, it was seeing a 40 00:02:09,120 --> 00:02:12,919 Speaker 1: little bit of that today. Uh, the tail i e. 41 00:02:13,520 --> 00:02:17,640 Speaker 1: The possibility of something highly improbable happening, Uh, could actually 42 00:02:17,639 --> 00:02:20,600 Speaker 1: be good for the market. So somebody announces they're making 43 00:02:20,600 --> 00:02:24,280 Speaker 1: progress with a vaccine. So it's a funny situation where 44 00:02:24,400 --> 00:02:27,240 Speaker 1: something flat. I was watching the news and something flashed 45 00:02:27,240 --> 00:02:30,560 Speaker 1: on and there was some surprise coming. I'm actually looking 46 00:02:30,560 --> 00:02:33,320 Speaker 1: forward to hear it, hearing it, whereas before it was 47 00:02:33,400 --> 00:02:35,960 Speaker 1: almost always going to be negative. One of the aspects 48 00:02:35,960 --> 00:02:38,040 Speaker 1: we're seeing in this is what appears to be a 49 00:02:38,160 --> 00:02:41,400 Speaker 1: very difficult choice between the one hand public health, safety, 50 00:02:41,480 --> 00:02:44,880 Speaker 1: well being, lives and the other hand the economy. Do 51 00:02:44,919 --> 00:02:47,440 Speaker 1: you think that we're striking that balance more or less 52 00:02:47,480 --> 00:02:50,720 Speaker 1: the right way. Well, just to question the predicate of that, 53 00:02:50,760 --> 00:02:53,600 Speaker 1: I think that's a real you know, that juxtaposition is 54 00:02:53,720 --> 00:02:57,040 Speaker 1: it's sometimes a bit off. I think there's health issues 55 00:02:57,040 --> 00:02:59,680 Speaker 1: on both sides, obviously, and a lot has been talked 56 00:02:59,680 --> 00:03:04,080 Speaker 1: about this now wherein you know, you know, extreme poverty obviously, 57 00:03:04,400 --> 00:03:06,080 Speaker 1: you know is a is a health risk and all 58 00:03:06,160 --> 00:03:09,600 Speaker 1: the things that proceed from it, and also you know, depression, uh, 59 00:03:09,800 --> 00:03:13,360 Speaker 1: drug addiction, UM, I mean suicide had an extreme but 60 00:03:13,440 --> 00:03:18,200 Speaker 1: basically life expectancy UH comes from uh, you know, a 61 00:03:18,320 --> 00:03:21,320 Speaker 1: fall off, a collapse in GDP, and this is unprecedented, 62 00:03:21,320 --> 00:03:23,240 Speaker 1: so this would be off any of those charts. So 63 00:03:23,280 --> 00:03:27,160 Speaker 1: I think it's not just health versus economy. It's health. 64 00:03:27,280 --> 00:03:30,200 Speaker 1: It's economy on both sides. And by the way, the 65 00:03:30,240 --> 00:03:34,200 Speaker 1: health issues maybe more neutral in some people think, you know, 66 00:03:34,280 --> 00:03:37,600 Speaker 1: once the curve is you know, the original intent to 67 00:03:37,680 --> 00:03:41,240 Speaker 1: flatten the curve was just to stretch out the exposures 68 00:03:41,280 --> 00:03:43,640 Speaker 1: that people would have so it didn't overwhelm the health 69 00:03:43,680 --> 00:03:46,040 Speaker 1: care system. But the fact of the matter is, I 70 00:03:46,040 --> 00:03:50,520 Speaker 1: think unless we're going to hunker down until a vaccine 71 00:03:50,600 --> 00:03:53,360 Speaker 1: comes up or until the virus is obliterated from the 72 00:03:53,400 --> 00:03:55,200 Speaker 1: face of the earth, which I think is too long 73 00:03:55,320 --> 00:03:58,560 Speaker 1: to keep the whole country unwelfare, eventually people are gonna 74 00:03:58,600 --> 00:04:01,360 Speaker 1: go back, and when they come back, the infection rate 75 00:04:01,440 --> 00:04:02,800 Speaker 1: is going to go up. So I think we're just 76 00:04:02,840 --> 00:04:07,760 Speaker 1: postponing the exposures and the infections. Well, that's actually one 77 00:04:07,760 --> 00:04:09,640 Speaker 1: of my questions, which is whether it's on the health 78 00:04:09,680 --> 00:04:12,960 Speaker 1: front or for them on the economic fund. Extraordinary efforts 79 00:04:12,960 --> 00:04:16,400 Speaker 1: are being made. Are we postponing what happens? We're actually 80 00:04:16,520 --> 00:04:19,600 Speaker 1: changing what happens. This is a timing matter only well 81 00:04:19,680 --> 00:04:22,280 Speaker 1: to some degree. Look if d s X makin a 82 00:04:22,320 --> 00:04:25,279 Speaker 1: vaccine appears, and I know there was some positive news today, 83 00:04:25,279 --> 00:04:27,080 Speaker 1: but just think it has to go through trials for 84 00:04:27,800 --> 00:04:29,520 Speaker 1: you know, we have to make sure it doesn't kill people, 85 00:04:29,680 --> 00:04:31,920 Speaker 1: make sure it's effective, it has to be manufactured. Just 86 00:04:31,960 --> 00:04:35,240 Speaker 1: stre that's really the country can't be unwelfare even that long. 87 00:04:35,279 --> 00:04:37,919 Speaker 1: Even if there was you know that was uh, something 88 00:04:37,960 --> 00:04:41,279 Speaker 1: that was magical. We are postponing it. But that doesn't 89 00:04:41,320 --> 00:04:45,520 Speaker 1: mean it's without help. They're learning things about treating viruses. 90 00:04:45,560 --> 00:04:47,680 Speaker 1: Even if there's not a vaccine, there are treatments that 91 00:04:47,720 --> 00:04:50,359 Speaker 1: people are aware of, so there is some benefit to it, 92 00:04:51,120 --> 00:04:54,000 Speaker 1: but not as huge as if there were an ultimate 93 00:04:54,080 --> 00:04:56,920 Speaker 1: vaccine that would make people comfortable. So too, I think 94 00:04:56,920 --> 00:05:01,200 Speaker 1: to a greater extent, we're postponing people's fosure to it, 95 00:05:01,640 --> 00:05:04,280 Speaker 1: and to some extent, uh, you know, we're eliminating the 96 00:05:04,720 --> 00:05:06,960 Speaker 1: diarist of risk that would happen if the health care 97 00:05:07,000 --> 00:05:10,240 Speaker 1: system was overwhelmed while people had it. But I think 98 00:05:10,240 --> 00:05:12,560 Speaker 1: in the long run, you know, we have to contemplate 99 00:05:12,600 --> 00:05:15,440 Speaker 1: that people will go back to work, what kind of 100 00:05:15,480 --> 00:05:17,360 Speaker 1: economy will have face and no matter when you do it. 101 00:05:17,360 --> 00:05:19,800 Speaker 1: Look what happened some of these Asian countries where they 102 00:05:19,839 --> 00:05:23,159 Speaker 1: almost they were high fiving because they the virus, the 103 00:05:23,240 --> 00:05:27,080 Speaker 1: new exposures were way way down, and notwithstanding that, the 104 00:05:27,160 --> 00:05:29,680 Speaker 1: second to go back to work, they spike up again. 105 00:05:29,720 --> 00:05:31,760 Speaker 1: So that's gonna be an expectation no matter when you 106 00:05:31,800 --> 00:05:34,680 Speaker 1: do it. I think when we go forward and look 107 00:05:34,720 --> 00:05:37,640 Speaker 1: back at this from sometime in the future, if we're 108 00:05:37,640 --> 00:05:41,000 Speaker 1: gonna go through that anyway, people will be very critical 109 00:05:41,240 --> 00:05:46,400 Speaker 1: if the official sector UH sacrificed more of the economy 110 00:05:46,400 --> 00:05:49,240 Speaker 1: than they needed to, even because at the end of 111 00:05:49,279 --> 00:05:51,040 Speaker 1: the day, I think the exposures are going to be, 112 00:05:51,240 --> 00:05:54,520 Speaker 1: you know, almost the same. We've heard a fair amount 113 00:05:54,360 --> 00:05:57,120 Speaker 1: of both President Trump and the Federal Reserve, particularly j 114 00:05:57,279 --> 00:05:59,880 Speaker 1: Pal the chair recently, and it seems from the Chair 115 00:06:00,000 --> 00:06:01,760 Speaker 1: how we're hearing two things. One is the Fed will 116 00:06:01,760 --> 00:06:04,320 Speaker 1: do pretty much whatever it can, whatever it needs to 117 00:06:04,320 --> 00:06:06,320 Speaker 1: to really support the economy as best it can. But 118 00:06:06,400 --> 00:06:08,560 Speaker 1: on the other hand, a lot of caution that this 119 00:06:08,640 --> 00:06:10,360 Speaker 1: may take longer than we think, it may be, more 120 00:06:10,400 --> 00:06:13,680 Speaker 1: difficulty think and even the possibly of long term damage. 121 00:06:13,720 --> 00:06:16,400 Speaker 1: How do you assess the possible damage to the U 122 00:06:16,440 --> 00:06:20,159 Speaker 1: S economy over the longer term. Well, obviously it depends 123 00:06:20,160 --> 00:06:22,240 Speaker 1: on how long this goes on. And you know, you 124 00:06:22,240 --> 00:06:25,360 Speaker 1: could see it's easy to see what damage would be. 125 00:06:25,440 --> 00:06:28,640 Speaker 1: You know, you have rest certain businesses that come into 126 00:06:28,640 --> 00:06:30,599 Speaker 1: contact with the public that are going to go away 127 00:06:30,600 --> 00:06:34,240 Speaker 1: that we're operating at tight margins anyway, Uh, that won't, 128 00:06:34,040 --> 00:06:36,960 Speaker 1: so that won't that can't afford to wait until they reopen, 129 00:06:37,040 --> 00:06:39,400 Speaker 1: and some businesses that will reopen at such a reduced 130 00:06:39,480 --> 00:06:42,279 Speaker 1: level that they won't be profitable, so they won't reopen. 131 00:06:42,560 --> 00:06:45,800 Speaker 1: That was former chairman and CEO of Goldman Sachs Lloyd 132 00:06:45,920 --> 00:06:48,840 Speaker 1: blank find coming up. The head of Bank of America, 133 00:06:48,960 --> 00:06:52,240 Speaker 1: Brian Wynihan says that government efforts to cushion the blow 134 00:06:52,279 --> 00:06:55,119 Speaker 1: to the economy are working. The question is how people 135 00:06:55,120 --> 00:06:58,640 Speaker 1: will react as we start the economy back up. That's 136 00:06:58,680 --> 00:07:07,200 Speaker 1: next on Wall Street Week on Bloomberg. This is Bloomberg 137 00:07:07,320 --> 00:07:11,360 Speaker 1: Wall Street Week with David Weston from Bloomberg Radio. We 138 00:07:11,440 --> 00:07:13,480 Speaker 1: aren't seeing the kinds of stress of the credit markets 139 00:07:13,600 --> 00:07:16,239 Speaker 1: we might have expected, and that's because the massive fiscal 140 00:07:16,280 --> 00:07:19,120 Speaker 1: and monetary support is having at least some effect. But 141 00:07:19,240 --> 00:07:22,280 Speaker 1: Bank of America chairman and CEO Brian moynihan says that 142 00:07:22,360 --> 00:07:24,760 Speaker 1: the real test will come as we start the economy 143 00:07:24,800 --> 00:07:28,120 Speaker 1: back up and we discover whether the consumer is willing 144 00:07:28,160 --> 00:07:31,760 Speaker 1: to become fully engaged. Our view hasn't changed, but it 145 00:07:31,800 --> 00:07:34,040 Speaker 1: comes back to what I said before. This is a 146 00:07:34,160 --> 00:07:37,520 Speaker 1: healthcare crisis. And as you're starting to see the healthcare 147 00:07:37,600 --> 00:07:40,840 Speaker 1: crisis be mitigated not solved yet, you're starting to see 148 00:07:40,880 --> 00:07:43,840 Speaker 1: the economy start to recover. And we can talk about that. 149 00:07:43,920 --> 00:07:46,840 Speaker 1: But the approach to winning UH, the war against the 150 00:07:46,840 --> 00:07:50,560 Speaker 1: crisis UH for us has been a customer centric, community centric, 151 00:07:50,560 --> 00:07:53,320 Speaker 1: employee centric move and so you know, we've been out 152 00:07:53,360 --> 00:07:55,440 Speaker 1: there driving. We've been supporting our clients and trying to 153 00:07:55,480 --> 00:07:57,560 Speaker 1: make sure they have the credit and capital to UH 154 00:07:58,680 --> 00:08:01,120 Speaker 1: to do what they need to do and help them 155 00:08:01,120 --> 00:08:03,320 Speaker 1: through this trough of activity in the second quarter. And 156 00:08:03,320 --> 00:08:05,080 Speaker 1: you can see that in a loan balance and extended 157 00:08:05,120 --> 00:08:07,760 Speaker 1: the P P P loans and how the things we've done. 158 00:08:07,840 --> 00:08:10,200 Speaker 1: We've helped our consumer clients through waivers so they have 159 00:08:10,600 --> 00:08:12,600 Speaker 1: the ability to have better cash flow in the house. 160 00:08:12,680 --> 00:08:15,200 Speaker 1: We helped our teammates by saying no layoffs so they 161 00:08:15,200 --> 00:08:17,760 Speaker 1: know their job is secure, and then getting them safe 162 00:08:17,760 --> 00:08:20,080 Speaker 1: and working from home. And then we've helped our communities 163 00:08:20,120 --> 00:08:23,760 Speaker 1: by contributions and a hundred million dollars and c d 164 00:08:23,840 --> 00:08:27,480 Speaker 1: f I investments which are community development financial institutions at 165 00:08:27,480 --> 00:08:30,000 Speaker 1: two fifty million dollars of which about a D seventy 166 00:08:29,960 --> 00:08:33,360 Speaker 1: millions already out. So all that is offsetting the impacts 167 00:08:33,360 --> 00:08:36,800 Speaker 1: of the current second quarter down drafted you've seen with 168 00:08:36,840 --> 00:08:39,440 Speaker 1: the unemployment numbers, and we don't see it much differently, 169 00:08:39,480 --> 00:08:41,000 Speaker 1: It's just that we're starting to see us come out 170 00:08:41,040 --> 00:08:43,439 Speaker 1: the other side of this. Frankly. So we have heard 171 00:08:43,440 --> 00:08:46,000 Speaker 1: from the Federal Reserve and they've expressed some concern at 172 00:08:46,080 --> 00:08:49,079 Speaker 1: least that as this pandemic continues, there may be some 173 00:08:49,160 --> 00:08:52,160 Speaker 1: threat to the overall system and specifically talks for example 174 00:08:52,200 --> 00:08:55,360 Speaker 1: about commercial real estate. Are you seeing some parts of 175 00:08:55,360 --> 00:08:58,000 Speaker 1: the market that are particularly vulnerable on the credit side. 176 00:08:58,200 --> 00:09:01,360 Speaker 1: Remember that the US economy is going to be depended 177 00:09:01,400 --> 00:09:05,079 Speaker 1: on the activity the consumer base, and and so yeah, 178 00:09:05,120 --> 00:09:06,840 Speaker 1: I always have to start there when you talk about 179 00:09:06,880 --> 00:09:09,600 Speaker 1: the US. So even though we have this year from 180 00:09:09,600 --> 00:09:11,760 Speaker 1: the Bank American research team, which is the best in 181 00:09:11,760 --> 00:09:15,160 Speaker 1: the world, you know, being minus five percent five and 182 00:09:15,200 --> 00:09:17,559 Speaker 1: a half percent this year and plus five percent next year, 183 00:09:18,200 --> 00:09:20,560 Speaker 1: the real question will be how to consumers behave, and 184 00:09:20,760 --> 00:09:23,680 Speaker 1: in what we've seen since the low point in the 185 00:09:23,720 --> 00:09:26,640 Speaker 1: second couple first couple weeks of April, in terms of 186 00:09:26,720 --> 00:09:29,320 Speaker 1: everything in terms of their spending because of the stay 187 00:09:29,320 --> 00:09:32,920 Speaker 1: at home edicts, in terms of their borrowing activity, UH, 188 00:09:32,960 --> 00:09:35,640 Speaker 1: in terms of the transfer of money. UM, you saw 189 00:09:35,679 --> 00:09:38,560 Speaker 1: all that fall to a lowest level, and obviously things 190 00:09:38,559 --> 00:09:41,560 Speaker 1: like travel and hotels and things were most affected. But 191 00:09:41,640 --> 00:09:43,880 Speaker 1: as you've seen steadily as you went through the third 192 00:09:43,880 --> 00:09:46,120 Speaker 1: week April then on into the first part of May, 193 00:09:46,240 --> 00:09:49,200 Speaker 1: you're seeing their activities pick up, even in the states 194 00:09:49,240 --> 00:09:51,520 Speaker 1: that are still under stay from home, and you're seeing 195 00:09:51,520 --> 00:09:53,920 Speaker 1: the activity pick up much quicker in the places they're 196 00:09:53,920 --> 00:09:57,040 Speaker 1: going back to work. And so for the month of May, 197 00:09:57,080 --> 00:09:59,080 Speaker 1: we're seeing it down about you know, two or three 198 00:09:59,160 --> 00:10:01,760 Speaker 1: or four percent verst was last year UH for the 199 00:10:01,880 --> 00:10:03,760 Speaker 1: year today, it's down a couple of percent. And that's 200 00:10:03,760 --> 00:10:05,440 Speaker 1: the question. The length of this is going to be 201 00:10:05,480 --> 00:10:09,680 Speaker 1: how the consumers behave given the high levels unemployment that 202 00:10:09,720 --> 00:10:12,440 Speaker 1: you've seen published when people get back to work, jobs 203 00:10:12,480 --> 00:10:15,560 Speaker 1: coming back in the stimulus payments which are all hitting 204 00:10:15,559 --> 00:10:17,439 Speaker 1: the street of the last few weeks, and how all 205 00:10:17,520 --> 00:10:19,839 Speaker 1: works together to see if the consumer's behavior changed. And 206 00:10:19,880 --> 00:10:22,800 Speaker 1: when I hear when you hear Government Chair Pale and others, 207 00:10:22,920 --> 00:10:25,480 Speaker 1: the concern I have is have we changed consumer behavior 208 00:10:25,480 --> 00:10:27,240 Speaker 1: as we look out across the next you know, four 209 00:10:27,320 --> 00:10:30,280 Speaker 1: or five, six quarters. Well, that is a key question, 210 00:10:30,320 --> 00:10:32,800 Speaker 1: maybe the key question, Brian, clearly when it comes to 211 00:10:32,840 --> 00:10:34,640 Speaker 1: the consumer. I know you've already taken about four point 212 00:10:34,679 --> 00:10:38,240 Speaker 1: eight billion dollar reserve against credit possible losses given the 213 00:10:38,320 --> 00:10:40,880 Speaker 1: level unemployment, which is really quite stunning. Do you think 214 00:10:40,880 --> 00:10:43,200 Speaker 1: that's gonna be enough? Well, what you've seen so far 215 00:10:43,360 --> 00:10:47,319 Speaker 1: is with the consumer help, we've we've granted about a 216 00:10:47,360 --> 00:10:50,040 Speaker 1: million a half payment deferrals. But if you look at 217 00:10:50,080 --> 00:10:53,679 Speaker 1: the actual interesting statistics about thirty or five or the 218 00:10:53,679 --> 00:10:55,640 Speaker 1: people ask for a credit card payment deferral when I 219 00:10:55,679 --> 00:10:57,199 Speaker 1: had made the payment. And if you go and a 220 00:10:57,280 --> 00:11:00,079 Speaker 1: look at those consumers, what you see is because of 221 00:11:00,160 --> 00:11:04,760 Speaker 1: the UH leave aside the issue of where the money 222 00:11:04,840 --> 00:11:06,920 Speaker 1: is coming from, you're seeing higher balance in our account. 223 00:11:07,280 --> 00:11:10,080 Speaker 1: And that's because the stimulus between you know, the I 224 00:11:10,160 --> 00:11:14,320 Speaker 1: P payments, between the enhanced unemployment, these measures taken by 225 00:11:14,360 --> 00:11:17,800 Speaker 1: Congress and by the administration, by the FED have worked 226 00:11:18,000 --> 00:11:22,880 Speaker 1: offset the unfortunate aspects of very high unemployment, and so 227 00:11:22,880 --> 00:11:25,200 Speaker 1: so far you're not seeing the delinquent seas and things 228 00:11:25,360 --> 00:11:29,920 Speaker 1: rise vs. You've seen payment deferrals UH increase, but you're 229 00:11:29,920 --> 00:11:31,720 Speaker 1: seeing them start to level off and come down in 230 00:11:31,760 --> 00:11:34,640 Speaker 1: our book, and so we we expect to see you 231 00:11:34,840 --> 00:11:38,000 Speaker 1: charge offs coming later on as as as this thing 232 00:11:38,040 --> 00:11:40,240 Speaker 1: goes on. But the reality is right now you're not 233 00:11:40,720 --> 00:11:42,920 Speaker 1: seeing the kind of credit damage that you'd expect to 234 00:11:42,960 --> 00:11:45,240 Speaker 1: see with this amount of down draft and activity. The 235 00:11:45,320 --> 00:11:47,480 Speaker 1: question is what happens next, and that's we're all watching. 236 00:11:48,040 --> 00:11:49,920 Speaker 1: And to that very point you said in the past, 237 00:11:50,000 --> 00:11:52,200 Speaker 1: China to some extent may give us some indication. We've 238 00:11:52,240 --> 00:11:54,800 Speaker 1: seen numbers coming out at China, Brian and indicate the 239 00:11:54,800 --> 00:11:57,439 Speaker 1: industrial production has come back pretty quickly. All consumption is 240 00:11:57,480 --> 00:11:59,600 Speaker 1: coming back as well. But on the other hand, consumer 241 00:11:59,640 --> 00:12:01,960 Speaker 1: maybe not so much with the retail sales. Does that 242 00:12:02,000 --> 00:12:04,559 Speaker 1: give you cause for concern back here in the United States, Well, 243 00:12:04,559 --> 00:12:07,360 Speaker 1: it does because the question is how did you change behavior? 244 00:12:07,480 --> 00:12:10,319 Speaker 1: So when you saw Chinese UH, you know, they went 245 00:12:10,360 --> 00:12:13,080 Speaker 1: into this earlier, they locked down earlier, they came out earlier, 246 00:12:13,520 --> 00:12:15,960 Speaker 1: and you know, we're back in our offices in China 247 00:12:16,040 --> 00:12:19,679 Speaker 1: moving from people back towards so you're starting to see 248 00:12:20,520 --> 00:12:23,079 Speaker 1: normalization of activity and in the questions what's the underlying 249 00:12:23,120 --> 00:12:26,480 Speaker 1: activity and restaurants and shopping and things like that. And 250 00:12:26,559 --> 00:12:29,400 Speaker 1: so you saw an immediate burst of activity as they 251 00:12:29,440 --> 00:12:31,560 Speaker 1: open back up and the say it fall back down. 252 00:12:31,559 --> 00:12:33,000 Speaker 1: And that's what we have to watch in the United 253 00:12:33,000 --> 00:12:34,840 Speaker 1: States is there will be a burst of activity in 254 00:12:34,840 --> 00:12:37,439 Speaker 1: some of these places as people who have been do 255 00:12:37,480 --> 00:12:39,720 Speaker 1: in their homes for six, five, six sevent eight weeks 256 00:12:39,760 --> 00:12:41,760 Speaker 1: go back out and do things, and then will let 257 00:12:41,800 --> 00:12:44,240 Speaker 1: sustain And that's where you need to look more fundamentally 258 00:12:44,360 --> 00:12:47,760 Speaker 1: on things like car purchases and things like house purchases 259 00:12:47,800 --> 00:12:49,480 Speaker 1: and see where they start to end up over time. 260 00:12:49,520 --> 00:12:52,920 Speaker 1: But remember the baseline projection for most people is the 261 00:12:52,920 --> 00:12:56,640 Speaker 1: economy doesn't get back to its current size until you 262 00:12:56,679 --> 00:12:58,520 Speaker 1: get to sort of the end of next year. That's 263 00:12:58,559 --> 00:13:02,080 Speaker 1: the definition of recovery. So but each quarter from this 264 00:13:02,200 --> 00:13:05,320 Speaker 1: quarter forward is increased economic activity. In what we have 265 00:13:05,400 --> 00:13:08,160 Speaker 1: to make sure and all the policies and stimulus have 266 00:13:08,200 --> 00:13:10,280 Speaker 1: been put in place or making sure is that despite 267 00:13:10,280 --> 00:13:13,079 Speaker 1: the very hig unemployment, despite the issues of who's unemployed, 268 00:13:13,080 --> 00:13:15,240 Speaker 1: despite the issues getting that we need to get people 269 00:13:15,240 --> 00:13:16,960 Speaker 1: back to work in the human toll of all that 270 00:13:17,520 --> 00:13:20,360 Speaker 1: these stimulus is off setting. It is an attempt off 271 00:13:20,360 --> 00:13:22,040 Speaker 1: set that and you have to see that play out 272 00:13:22,040 --> 00:13:24,439 Speaker 1: of our time, Brian, you have something like a hundred 273 00:13:24,480 --> 00:13:26,520 Speaker 1: eighty thousand I think people working from home right now. 274 00:13:26,559 --> 00:13:29,040 Speaker 1: You talked about what you're doing over in Asia. When 275 00:13:29,040 --> 00:13:30,840 Speaker 1: do you expect him to come back? And how and 276 00:13:30,880 --> 00:13:33,080 Speaker 1: by the way, how many will they all come back? Well? 277 00:13:33,080 --> 00:13:35,680 Speaker 1: That the ideas we have. We've always had people who 278 00:13:35,840 --> 00:13:39,600 Speaker 1: worked outside the standard office setting, and that's something we do. Um. 279 00:13:39,960 --> 00:13:42,720 Speaker 1: There's a great debate you know, with us change forever 280 00:13:43,040 --> 00:13:45,720 Speaker 1: the workforce in America and where they want to work. 281 00:13:46,000 --> 00:13:47,920 Speaker 1: We'll see that play out. But that is that is 282 00:13:47,960 --> 00:13:50,360 Speaker 1: further out there. And then your term. We have we 283 00:13:50,400 --> 00:13:52,360 Speaker 1: have been open every day. We have not shut down 284 00:13:52,520 --> 00:13:55,599 Speaker 1: except for the branches we closed out of concerns to 285 00:13:55,679 --> 00:13:58,840 Speaker 1: keep our teammates safe in those in those branches. Um, 286 00:13:59,280 --> 00:14:03,840 Speaker 1: we which is about the branches. Everything else has been open. 287 00:14:03,840 --> 00:14:05,880 Speaker 1: We've been functioning every day and we're beginning to open 288 00:14:05,880 --> 00:14:09,160 Speaker 1: those branches, especially in the States, are reopening slowly but surely. 289 00:14:09,240 --> 00:14:12,240 Speaker 1: So we have the ability to operate very well, very 290 00:14:12,280 --> 00:14:15,480 Speaker 1: much under control. Our technops team under Kathy Bisson's leadership, 291 00:14:15,480 --> 00:14:17,319 Speaker 1: to the fablished job of putting us a position to 292 00:14:17,360 --> 00:14:19,280 Speaker 1: have a hundred and eighty thousand people work from home 293 00:14:19,760 --> 00:14:21,520 Speaker 1: so we can operate this way. So we have the 294 00:14:21,600 --> 00:14:25,640 Speaker 1: luxury to go back slowly and with social distancing requirements, 295 00:14:25,680 --> 00:14:29,200 Speaker 1: with temperature taking while all the policies that all employers 296 00:14:29,200 --> 00:14:31,720 Speaker 1: want to put in place, you know, the the ability 297 00:14:31,720 --> 00:14:34,400 Speaker 1: of the luxury putting people back in place carefully also 298 00:14:34,440 --> 00:14:36,640 Speaker 1: takes the burden off of the communities we operate in, 299 00:14:36,720 --> 00:14:40,800 Speaker 1: not to have high level of cases or perfections and 300 00:14:40,920 --> 00:14:43,880 Speaker 1: having people move around and creating pressure on the community. 301 00:14:44,000 --> 00:14:46,920 Speaker 1: So we will go back slowly. We haven't said any 302 00:14:46,960 --> 00:14:49,520 Speaker 1: plans yet. We have a top talent team working on 303 00:14:49,920 --> 00:14:52,440 Speaker 1: the re entry back to the office. It's not back 304 00:14:52,480 --> 00:14:54,360 Speaker 1: to work, We're working every day. It's back to the office. 305 00:14:54,520 --> 00:14:58,080 Speaker 1: That was Brian moynihan, Bank of America Chairman and CEO. 306 00:14:58,640 --> 00:15:01,960 Speaker 1: Coming up. Speaker Nancy Pelosi thinks she knows what the 307 00:15:02,000 --> 00:15:05,000 Speaker 1: public needs to feel confident, and it's going to require 308 00:15:05,080 --> 00:15:08,440 Speaker 1: some more help from the federal government. That's next on 309 00:15:08,520 --> 00:15:17,120 Speaker 1: Wall Street Week on Bloomberg. This is Bloomberg Wall Street 310 00:15:17,160 --> 00:15:21,560 Speaker 1: Week with David Weston from Bloomberg Radio. Congress has already 311 00:15:21,600 --> 00:15:25,120 Speaker 1: appropriated trillions of dollars to show up the economy, but 312 00:15:25,200 --> 00:15:27,880 Speaker 1: Speaker of the House Nancy Pelosi says more needs to 313 00:15:27,920 --> 00:15:30,320 Speaker 1: be done to help those tens of millions of Americans 314 00:15:30,400 --> 00:15:32,600 Speaker 1: who are out of work and to protect hundreds of 315 00:15:32,640 --> 00:15:35,480 Speaker 1: millions of Americans across the country as they return to 316 00:15:35,560 --> 00:15:38,760 Speaker 1: the marketplace. Yes, it, indeed, we want the economy to 317 00:15:38,880 --> 00:15:45,920 Speaker 1: open up, and the science is the path to that. Testing, tracing, treating, isolating. 318 00:15:46,560 --> 00:15:49,280 Speaker 1: It has to be a scientific answer, and of course 319 00:15:49,280 --> 00:15:53,120 Speaker 1: we hope and pray for vaccine and and some therapies, 320 00:15:53,600 --> 00:15:56,800 Speaker 1: but in the meantime, we have testing and that's what 321 00:15:56,920 --> 00:15:59,560 Speaker 1: we need to use to get the handle on the 322 00:15:59,640 --> 00:16:03,000 Speaker 1: side of the challenge. We have uh to trace it 323 00:16:03,160 --> 00:16:06,320 Speaker 1: and to treat so that we have fewer deaths. That 324 00:16:06,480 --> 00:16:08,760 Speaker 1: is the answer now. In addition to that, and we 325 00:16:08,840 --> 00:16:12,440 Speaker 1: have that a strategic plan and our heroes at a 326 00:16:12,480 --> 00:16:15,440 Speaker 1: strategic plan to do that with. As you do in business, 327 00:16:15,440 --> 00:16:19,920 Speaker 1: have a goal, have a timetable, had milestones, have benchmarks. 328 00:16:19,960 --> 00:16:23,120 Speaker 1: That's exactly what we have in addition to that, in 329 00:16:23,240 --> 00:16:26,640 Speaker 1: order to support the economy. We honor our heroes by 330 00:16:26,720 --> 00:16:32,080 Speaker 1: keeping state, local, territorial, and tribal governments functioning. Uh. These people, 331 00:16:32,240 --> 00:16:34,720 Speaker 1: many of them on the front line of risking their 332 00:16:34,760 --> 00:16:38,600 Speaker 1: lives to save other people's lives, now fear losing their jobs. 333 00:16:39,240 --> 00:16:42,760 Speaker 1: All of these services that are rendered are not only jobs, 334 00:16:42,760 --> 00:16:45,800 Speaker 1: but they are they meet the needs of the American people. 335 00:16:46,320 --> 00:16:49,600 Speaker 1: That helps the economy. And then third, putting money into 336 00:16:49,680 --> 00:16:52,800 Speaker 1: the pockets of the American people. We all know that 337 00:16:53,240 --> 00:16:58,040 Speaker 1: issues like unemployment, insurance, food stamps and the rest really 338 00:16:58,080 --> 00:17:02,280 Speaker 1: are provide stimulus to the economy, and we have to 339 00:17:02,320 --> 00:17:05,400 Speaker 1: do that. Uh. And we said we think in our package, 340 00:17:05,560 --> 00:17:09,440 Speaker 1: the Heroes Act, that we do just exactly that, a 341 00:17:09,560 --> 00:17:14,880 Speaker 1: scientific path to open the economy safely, safely and soon, 342 00:17:16,119 --> 00:17:20,360 Speaker 1: supporting our heroes, to keep those jobs in place, which 343 00:17:20,400 --> 00:17:23,240 Speaker 1: is important, which are important to the economy, and again 344 00:17:23,280 --> 00:17:25,640 Speaker 1: the stimulus that money in the pockets of the American 345 00:17:25,680 --> 00:17:30,159 Speaker 1: people provides. Of course, the question on everyone's mind is 346 00:17:30,200 --> 00:17:33,200 Speaker 1: the prospects of passage of the Heroes Act or something 347 00:17:33,240 --> 00:17:35,359 Speaker 1: like it, and when it might happen. We've heard from 348 00:17:35,400 --> 00:17:37,760 Speaker 1: Secretary Minution that he talked to you at least last 349 00:17:37,800 --> 00:17:39,880 Speaker 1: week about something he agrees something needs to be done. 350 00:17:39,920 --> 00:17:42,320 Speaker 1: I'm not sure how quickly. President Trump said he's working 351 00:17:42,520 --> 00:17:44,960 Speaker 1: with Mitch McConnell as a majority leader on some sort 352 00:17:44,960 --> 00:17:48,320 Speaker 1: of package. Are you in active negotiations? How much hope 353 00:17:48,320 --> 00:17:51,560 Speaker 1: do you have the will have something relatively soon? Well, 354 00:17:51,600 --> 00:17:55,640 Speaker 1: I'm optimistic because American people fully support what we are 355 00:17:55,680 --> 00:18:00,800 Speaker 1: doing two to one already just it's just newly passed. Uh. 356 00:18:00,840 --> 00:18:05,080 Speaker 1: They support the provisions of our bill and oppose the 357 00:18:05,200 --> 00:18:09,560 Speaker 1: Senate obstructing it. So I have confidence in public opinion 358 00:18:10,000 --> 00:18:13,560 Speaker 1: also when it's by partisan across the country, we have 359 00:18:14,080 --> 00:18:17,840 Speaker 1: less than a trillion dollars that goes to states, localities, tribes, 360 00:18:17,880 --> 00:18:24,680 Speaker 1: and territorial governments that provide jobs for people across the country. 361 00:18:24,720 --> 00:18:29,760 Speaker 1: So we have democratic and Republican mayors, governors, county executives 362 00:18:29,760 --> 00:18:33,720 Speaker 1: and the rest very enthusiastic about the legislation and making 363 00:18:33,760 --> 00:18:37,879 Speaker 1: their voices known, uh to the members of the United 364 00:18:37,920 --> 00:18:41,359 Speaker 1: States Senate. This is very unusual that we have such 365 00:18:41,400 --> 00:18:48,320 Speaker 1: a strong bipartisan advocacy for legislation of this kind, which 366 00:18:48,359 --> 00:18:52,200 Speaker 1: is meeting resistance in the Senate. But I don't think 367 00:18:52,280 --> 00:18:55,800 Speaker 1: for long because what we have in the bill is disciplined, 368 00:18:56,119 --> 00:19:00,679 Speaker 1: it's focused, its own necessary, and it has brought bipartisan 369 00:19:00,720 --> 00:19:03,480 Speaker 1: support in the country. It's just a matter of time. 370 00:19:03,600 --> 00:19:06,720 Speaker 1: They want to pause. But as I've said here before, 371 00:19:07,880 --> 00:19:10,840 Speaker 1: hunger doesn't take a pause, Losing your job doesn't take 372 00:19:10,880 --> 00:19:14,120 Speaker 1: a pause. All of the paying the rent doesn't take 373 00:19:14,160 --> 00:19:16,960 Speaker 1: a pause. We really need to meet the needs of 374 00:19:17,000 --> 00:19:20,600 Speaker 1: the American people and at the same time provide stimulus 375 00:19:20,680 --> 00:19:25,040 Speaker 1: to the economy. You mentioned minuting, but also the head 376 00:19:25,040 --> 00:19:27,160 Speaker 1: of the FED, the Chairman of the Fed, Powell has 377 00:19:27,200 --> 00:19:31,680 Speaker 1: said that is responsibility of elected representatives to use the 378 00:19:31,720 --> 00:19:35,880 Speaker 1: tax and spend responsibilities that we have in a way 379 00:19:35,920 --> 00:19:40,280 Speaker 1: that helps the economy, and he has indicated that there's 380 00:19:40,359 --> 00:19:44,520 Speaker 1: need for more. Just one quick thought about China, because 381 00:19:44,520 --> 00:19:46,639 Speaker 1: another thing that pious to have bipartisan support right now 382 00:19:46,720 --> 00:19:49,960 Speaker 1: the Capitol Hill is the legislation including possibly delistings some 383 00:19:50,080 --> 00:19:51,919 Speaker 1: Chinese company. Is that going to make it. It's been 384 00:19:51,920 --> 00:19:53,680 Speaker 1: through the Senate, is it gonna make it through the House, 385 00:19:53,880 --> 00:19:57,920 Speaker 1: and might have ramifications for the markets overall I have 386 00:19:58,240 --> 00:20:01,600 Speaker 1: this is something we just learned of past uh with 387 00:20:01,760 --> 00:20:06,080 Speaker 1: unanimous consent, so it isn't much debate or uh, we 388 00:20:06,119 --> 00:20:09,280 Speaker 1: don't know who voted if unanimous consent, so we'll review 389 00:20:09,320 --> 00:20:11,440 Speaker 1: it in the House. I've asked my committees to take 390 00:20:11,480 --> 00:20:13,840 Speaker 1: a look at what that is. I take second place 391 00:20:13,880 --> 00:20:17,359 Speaker 1: to No. One UH in the Congress, House or Senate, 392 00:20:17,440 --> 00:20:22,399 Speaker 1: and my criticisms of China's UH trade policies visit the 393 00:20:22,520 --> 00:20:26,160 Speaker 1: United States over decades, or human rights policies, or proliferation 394 00:20:26,480 --> 00:20:29,879 Speaker 1: of weapons of mass destruction right now, whether it's the 395 00:20:29,960 --> 00:20:32,560 Speaker 1: weed ares, the people of Hong Kong to bet, you 396 00:20:32,680 --> 00:20:35,920 Speaker 1: name it. They have been very oppressive and even more so. 397 00:20:36,400 --> 00:20:38,840 Speaker 1: But the fact is that we have to judge every 398 00:20:39,240 --> 00:20:41,399 Speaker 1: We have to have a relationship with China, and we 399 00:20:41,520 --> 00:20:44,520 Speaker 1: judge every action as to what it means to us 400 00:20:44,600 --> 00:20:46,680 Speaker 1: as well as what it means to them. So I 401 00:20:46,800 --> 00:20:49,800 Speaker 1: look forward to seeing that. It's interesting that it had 402 00:20:49,840 --> 00:20:53,200 Speaker 1: such unanimous support, though in the center that was speed 403 00:20:53,200 --> 00:20:56,119 Speaker 1: of the House. Nancy Pelosi coming up. We wrap up 404 00:20:56,119 --> 00:20:59,520 Speaker 1: the week with Larry Summers. This is Wall Street Read 405 00:20:59,760 --> 00:21:08,560 Speaker 1: on Bloomberg. This is Bloomberg Wall Street Week with David 406 00:21:08,600 --> 00:21:11,560 Speaker 1: Weston from Bloomberg Radio. We wrap up the week this 407 00:21:11,600 --> 00:21:14,200 Speaker 1: week we do every week with our very special contributor 408 00:21:14,359 --> 00:21:18,000 Speaker 1: Larry Summers of Harvard so, Larry, we had some experience 409 00:21:18,080 --> 00:21:20,439 Speaker 1: this week with some economies starting to open up. We 410 00:21:20,480 --> 00:21:23,240 Speaker 1: had Georgia start to open up first. We also have 411 00:21:23,680 --> 00:21:26,239 Speaker 1: Sweden that never really closed very much. What are we 412 00:21:26,359 --> 00:21:29,840 Speaker 1: learning from that is it doesn't do the consumers come 413 00:21:30,000 --> 00:21:34,840 Speaker 1: bouncing right back. I think we're learning something um that 414 00:21:34,920 --> 00:21:37,960 Speaker 1: was quite surprising to me, though perhaps it should not 415 00:21:38,119 --> 00:21:44,200 Speaker 1: have been. Uh. Lockdown is actually less the issue than 416 00:21:44,440 --> 00:21:48,400 Speaker 1: people's fear. If you look at what's happened to consumer spending, 417 00:21:48,480 --> 00:21:53,320 Speaker 1: it's come back some in Georgia, but it's also come down. 418 00:21:53,400 --> 00:21:56,320 Speaker 1: It's also come back in New York and to just 419 00:21:56,520 --> 00:22:00,920 Speaker 1: about exactly the same extent. If you look at Sweden, 420 00:22:01,000 --> 00:22:06,080 Speaker 1: which never closed down, and Denmark, which closed down pretty rigorously. 421 00:22:06,680 --> 00:22:10,760 Speaker 1: Many more people have died in Sweden, but there hasn't 422 00:22:10,800 --> 00:22:14,280 Speaker 1: been much difference in what's happened to consumer spending or 423 00:22:14,280 --> 00:22:17,800 Speaker 1: the economy. The Swedish economies dipped eighty percent as much 424 00:22:18,200 --> 00:22:22,320 Speaker 1: as the Danish economy has the reality is that what 425 00:22:22,359 --> 00:22:25,959 Speaker 1: this is more about is not the lockdown, but the 426 00:22:26,080 --> 00:22:30,040 Speaker 1: virus and people's degree of confidence. And if you think 427 00:22:30,080 --> 00:22:33,880 Speaker 1: about it, that makes sense. If they opened up all 428 00:22:33,880 --> 00:22:37,119 Speaker 1: the restaurants to go sit in one. I wouldn't go 429 00:22:37,240 --> 00:22:42,639 Speaker 1: sit in restaurant now, even though I like UH restaurants, 430 00:22:42,840 --> 00:22:46,400 Speaker 1: I think most of us are more constrained by our 431 00:22:46,440 --> 00:22:50,000 Speaker 1: desire to be prudent about our health and prudent about 432 00:22:50,040 --> 00:22:53,080 Speaker 1: the health of people we might pass a virus onto. 433 00:22:53,480 --> 00:22:59,359 Speaker 1: Then we are constrained by some law that some governor decrees. 434 00:23:00,119 --> 00:23:04,040 Speaker 1: That just underscores what I've been saying for some weeks 435 00:23:04,080 --> 00:23:10,840 Speaker 1: that ultimately the most important economic policies are the health policies, 436 00:23:11,240 --> 00:23:17,880 Speaker 1: whether it's testing or therapy or vaccination that or contact tracing, 437 00:23:18,320 --> 00:23:21,720 Speaker 1: that can put this problem in the rear view mirror. 438 00:23:22,119 --> 00:23:25,200 Speaker 1: And until we do that, I don't think we're really 439 00:23:25,240 --> 00:23:31,560 Speaker 1: gonna fix the fundamental economic concern. And when we do that, 440 00:23:32,240 --> 00:23:38,920 Speaker 1: we've got a prospect of a reasonably rapid UH recovery. 441 00:23:38,960 --> 00:23:42,359 Speaker 1: But I think we have learned something important that this 442 00:23:42,560 --> 00:23:48,760 Speaker 1: great debate about lockdowns is actually less of a debate 443 00:23:48,920 --> 00:23:52,240 Speaker 1: than we have all thought about it as being, because 444 00:23:52,280 --> 00:23:55,159 Speaker 1: people who don't believe in the lockdown in the United 445 00:23:55,200 --> 00:23:59,160 Speaker 1: States don't respect it and honor it, and people who 446 00:23:59,720 --> 00:24:04,200 Speaker 1: are are scared don't go out even if the lockdown 447 00:24:05,560 --> 00:24:09,160 Speaker 1: is UH removed. I saw that one of the prominent 448 00:24:09,240 --> 00:24:13,960 Speaker 1: Washington think tanks. UM has announced that it's not going 449 00:24:14,040 --> 00:24:16,359 Speaker 1: to have any visitors until the end of the year, 450 00:24:17,080 --> 00:24:20,560 Speaker 1: and it's not gonna have anybody back in their offices 451 00:24:20,720 --> 00:24:24,520 Speaker 1: until September at the earliest. Well, you know, they're not 452 00:24:24,600 --> 00:24:28,119 Speaker 1: waiting to see what gets decreed by the president or 453 00:24:28,160 --> 00:24:31,399 Speaker 1: by the mayor of Washington, d C. And you're seeing 454 00:24:31,440 --> 00:24:35,399 Speaker 1: a lot of that kind of thing. This is going 455 00:24:35,440 --> 00:24:40,080 Speaker 1: to be based more on decentralized decision making of people 456 00:24:40,119 --> 00:24:44,119 Speaker 1: who assess risks to themselves. Uh. Is I think what 457 00:24:44,160 --> 00:24:47,840 Speaker 1: we've learned here. Yeah, as you say, Larry, consumers are 458 00:24:47,840 --> 00:24:50,000 Speaker 1: gonna vote with their feet is a practical matter. But 459 00:24:50,119 --> 00:24:53,200 Speaker 1: you've been a staunch advocate for a much ramped up 460 00:24:53,280 --> 00:24:56,600 Speaker 1: testing and contact tracing program. Is it possible that could 461 00:24:56,640 --> 00:24:58,919 Speaker 1: be enough to restore the confidence to the consumer, to 462 00:24:58,960 --> 00:25:01,000 Speaker 1: the worker or we really have to wait to a 463 00:25:01,080 --> 00:25:05,119 Speaker 1: vaccine as a practical practical matter. Look, I don't think 464 00:25:05,280 --> 00:25:07,800 Speaker 1: this is going to be behind us until we have 465 00:25:07,840 --> 00:25:15,199 Speaker 1: a vaccine or a convincing and highly credible, uh, highly 466 00:25:15,280 --> 00:25:21,639 Speaker 1: credible kind of therapy. I do think that if we 467 00:25:21,720 --> 00:25:27,240 Speaker 1: did the right things with testing, that all kinds of 468 00:25:27,920 --> 00:25:33,880 Speaker 1: private ways of employers testing their employees before they come 469 00:25:33,880 --> 00:25:39,840 Speaker 1: back and retesting them on a periodic basis. Universities UH 470 00:25:40,160 --> 00:25:43,879 Speaker 1: opening to at least some extent based on the fact 471 00:25:43,920 --> 00:25:47,800 Speaker 1: that they were going to test each student with UH 472 00:25:48,200 --> 00:25:53,480 Speaker 1: some period some periodicity. UM. I think these kinds of 473 00:25:53,520 --> 00:25:57,439 Speaker 1: things will start to happen if we have testing, and 474 00:25:57,520 --> 00:26:03,640 Speaker 1: they'll be a further multiplier from UH testing UH if 475 00:26:03,720 --> 00:26:09,840 Speaker 1: we can UH do it more more pervasively. So I 476 00:26:09,920 --> 00:26:14,680 Speaker 1: do think that ramping up testing should be a very 477 00:26:14,720 --> 00:26:19,679 Speaker 1: great priority. I suspect the utility of testing will come 478 00:26:19,720 --> 00:26:25,159 Speaker 1: in a more decentralized way then I probably would have 479 00:26:25,200 --> 00:26:29,160 Speaker 1: imagined a few weeks ago. It'll be employers, it will 480 00:26:29,200 --> 00:26:33,560 Speaker 1: be airlines um, not wanting to have anybody with the 481 00:26:33,640 --> 00:26:40,360 Speaker 1: virus on their planes. It will be similar things for 482 00:26:40,920 --> 00:26:47,480 Speaker 1: entering into various kinds of activities, right right, So the Larry, 483 00:26:47,560 --> 00:26:49,600 Speaker 1: if the markets didn't have enough to worry about with 484 00:26:49,640 --> 00:26:53,800 Speaker 1: the virus, we also injected growing conflict with China US 485 00:26:53,880 --> 00:26:57,200 Speaker 1: China UH, and we have of course the People's Congress 486 00:26:57,280 --> 00:26:59,919 Speaker 1: meeting and taking various actions. We have up on the 487 00:27:00,080 --> 00:27:04,159 Speaker 1: hill move to delist some Chinese companies passed the Senate 488 00:27:04,520 --> 00:27:06,679 Speaker 1: it's depending before the House. And the meantime, we had 489 00:27:06,680 --> 00:27:09,199 Speaker 1: the Secretary of State Pompeios that we're gonna review the 490 00:27:09,400 --> 00:27:11,879 Speaker 1: special trade stays for Hong Kong because Hong Kong actually 491 00:27:12,000 --> 00:27:14,600 Speaker 1: sort of a victim perhaps of Beijing saying we're having 492 00:27:14,600 --> 00:27:16,920 Speaker 1: new security law. Does that make sense right now given 493 00:27:16,960 --> 00:27:18,879 Speaker 1: what's going on with the global economy and the U 494 00:27:19,000 --> 00:27:25,879 Speaker 1: S economy. I don't get it. UM, Hong Kong's a victim, 495 00:27:25,920 --> 00:27:29,280 Speaker 1: so why punish. I don't think you're gonna do any 496 00:27:29,440 --> 00:27:34,560 Speaker 1: important damage to China by fooling around with Hong Kong's 497 00:27:34,720 --> 00:27:38,480 Speaker 1: trade status, But you're gonna hurt the people of Hong 498 00:27:38,560 --> 00:27:44,879 Speaker 1: Kong even worse are than UH. They're hurting UH now, 499 00:27:45,359 --> 00:27:52,320 Speaker 1: So I don't really see UH the logic. I sympathize I, 500 00:27:52,320 --> 00:27:56,359 Speaker 1: and I feel for the fact that the warnings that 501 00:27:56,440 --> 00:28:00,480 Speaker 1: were given at the time when UH I was in 502 00:28:00,680 --> 00:28:04,080 Speaker 1: I was in government at the time and went to 503 00:28:04,160 --> 00:28:09,760 Speaker 1: Hong Kong and spoke about the importance of one country, 504 00:28:09,800 --> 00:28:14,840 Speaker 1: two systems as really a test of China's UH credibility, 505 00:28:14,880 --> 00:28:17,639 Speaker 1: and China doesn't appear to be meeting that test. And 506 00:28:17,680 --> 00:28:21,199 Speaker 1: it's tragic, but it seems like to the extent we 507 00:28:21,240 --> 00:28:24,480 Speaker 1: want to be taking any action, it should be towards 508 00:28:24,880 --> 00:28:29,840 Speaker 1: UH China, not towards the victim, which is Hong Kong. 509 00:28:30,760 --> 00:28:39,840 Speaker 1: I don't really understand why preventing Americans preventing Chinese companies 510 00:28:40,280 --> 00:28:44,440 Speaker 1: from listing on the American stock market when they meet 511 00:28:44,520 --> 00:28:48,920 Speaker 1: the relevant capital market requirements is going to serve American interests. 512 00:28:48,960 --> 00:28:53,040 Speaker 1: Seems to me that it's going to reduce our degree 513 00:28:53,080 --> 00:28:57,880 Speaker 1: of influence and leverage over those companies and over China. 514 00:28:58,480 --> 00:29:02,600 Speaker 1: It's gonna make it harder for Americans to make investments. 515 00:29:03,160 --> 00:29:06,440 Speaker 1: It's not going to really impact on those countries ability 516 00:29:06,480 --> 00:29:09,880 Speaker 1: to access capital. It's going to be a great gift 517 00:29:10,200 --> 00:29:16,440 Speaker 1: UH to stock exchanges in Singapore, to stock exchanges UH 518 00:29:16,480 --> 00:29:19,720 Speaker 1: in London. Ironically, it may be a big gift to 519 00:29:19,800 --> 00:29:22,960 Speaker 1: the Hong Kong Stock Exchange. At the same time, other 520 00:29:23,000 --> 00:29:28,040 Speaker 1: people in the administration are trying to damage UH the 521 00:29:28,120 --> 00:29:31,440 Speaker 1: Hong Kong economy. So I don't think we have a 522 00:29:31,520 --> 00:29:37,640 Speaker 1: policy that's defined by its UH coherence. I think a 523 00:29:37,800 --> 00:29:41,320 Speaker 1: mature policy would recognize that at this point we are 524 00:29:41,320 --> 00:29:44,120 Speaker 1: not friends with China and probably not going to be 525 00:29:44,680 --> 00:29:51,120 Speaker 1: friends or allies or partners in the foreseeable future. We 526 00:29:51,280 --> 00:29:58,960 Speaker 1: are uh, two very strong individuals in a small lifeboat 527 00:29:59,280 --> 00:30:02,720 Speaker 1: in a turbulent let's see, a long way from the shore. 528 00:30:03,760 --> 00:30:07,600 Speaker 1: We don't need to like each other, but we do 529 00:30:07,800 --> 00:30:14,360 Speaker 1: need to cooperate with each other. And pursuing tip for 530 00:30:14,480 --> 00:30:20,760 Speaker 1: tat acts of revenge, even if we're right in some 531 00:30:20,960 --> 00:30:27,760 Speaker 1: abstract sense that we can anger hers and alienate them, 532 00:30:28,720 --> 00:30:33,320 Speaker 1: is not going to serve our objective of getting to 533 00:30:34,040 --> 00:30:38,480 Speaker 1: uh the shore. So we need to find a way 534 00:30:39,120 --> 00:30:47,880 Speaker 1: of elevating this relationship past at um the adulthood, Yeah, 535 00:30:47,920 --> 00:30:50,320 Speaker 1: which will be particularly challenge in a presidential election year. 536 00:30:50,360 --> 00:30:52,880 Speaker 1: I did dare say thank you so much Larry Summers, 537 00:30:52,880 --> 00:30:56,760 Speaker 1: our special contributor, of course, former Secretary of Treasury that 538 00:30:56,880 --> 00:31:01,000 Speaker 1: does it for Wall Street Week. I'm David Weston is Bloomberg. 539 00:31:01,200 --> 00:31:02,360 Speaker 1: I hopefully see you next week.