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Speaker 2: Joining us now from JP Morgan is Monica Descenzo. Thrilled
Speaker 2: that she could be with us today with private bank.
Speaker 2: But I've got to go to your ute. You came
Speaker 2: out of Georgetown, yes, and we talked just there about
Speaker 2: digital and I'm living digital every day with a team
Speaker 2: on YouTube. You covered at JP Morgan the digital nascent
Speaker 2: experience of the New York Times. Did you ever think
Speaker 2: the New York Times? I remember arguing with people and
Speaker 2: in bars with a beverage of my choice in my hand,
Speaker 2: that they would succeed at this and they could get
Speaker 2: to two million. People said, no way. Did you see
Speaker 2: the digital success of the Times coming?
Speaker 3: It's funny.
Speaker 4: I was relatively young when I was doing this, and
Speaker 4: so you would you could argue that I would have
Speaker 4: been more forward thinking digital. I actually never thought the print.
Speaker 3: Would go away.
Speaker 4: I just thought people would always still enjoy having a
Speaker 4: print subscription I think the New York Times did a
Speaker 4: great job putting up that paywall and figuring out how
Speaker 4: to monetize the digital subscriptions. And I still subscribe to
Speaker 4: both print.
Speaker 2: It's amazing, I mean out to eleven million.
Speaker 5: Yeah, no, it's you know, it's hardly the failing New York.
Speaker 2: Times as the president. And JP Morgan is way out
Speaker 2: front of this with your it was a really your
Speaker 2: II and all that.
Speaker 3: Do you use to pay for content?
Speaker 2: Right?
Speaker 3: That's the bottom line sell.
Speaker 2: Side analysis of JP Morgan private make with high net worth,
Speaker 2: with with with family offices. Is there still a place
Speaker 2: there for what you used to do? Oh?
Speaker 4: Absolutely, I mean, you know, there's there's a ton of
Speaker 4: value in people who are experts in their sectors. And
Speaker 4: the challenge in my seat is the clients I work
Speaker 4: with can invest anywhere, so they're not beholden to one sector,
Speaker 4: what one small part of a US market or a
Speaker 4: national market.
Speaker 3: So we need to.
Speaker 4: Look across all research and make a decision based on
Speaker 4: your goals, what's the best way to reach those goals.
Speaker 4: And it could be a media company, it could be
Speaker 4: an industrial company, it could be healthcare. So that's what
Speaker 4: makes it fun. But We rely on JP Morgan's research,
Speaker 4: which is amazing, as well as others across the streation.
Speaker 5: Sure your clients can invest anywhere, are they doing it?
Speaker 5: I mean amidst the whirl of headlines that we're dealing with.
Speaker 5: I imagine there is some adjita among them as well,
Speaker 5: wondering if if this is the time the time to
Speaker 5: do it. What are you telling them just about this
Speaker 5: environment and how they can maybe grow their appetite for
Speaker 5: taking some risk right now.
Speaker 4: I think agitas is the right word, one that I
Speaker 4: grew up using in my family. You know, it's hard
Speaker 4: because I think people are still scarred by twenty two
Speaker 4: when equity is revolatile and fixing come is violatile, and
Speaker 4: so trying to convince people that in today's world you
Speaker 4: actually have so many choices across asset classes. It to me,
Speaker 4: as an investor who can go anywhere, this is like
Speaker 4: an amazing environment.
Speaker 3: I look at equities US equities.
Speaker 4: I don't think you're going to get more than maybe
Speaker 4: high single digit returns this year, So suddenly fixed income
Speaker 4: looks more interesting. Ways to monetize volatility and commodities looks interesting.
Speaker 4: There's a lot of ways to get to that most
Speaker 4: of my clients want to get seven eight percent annualized
Speaker 4: to meet their goals.
Speaker 3: There's a lot of ways to get there. Right now.
Speaker 4: It's not all equities anymore. The temptation for many is
Speaker 4: they go to what worked? Do they just want to
Speaker 4: keep owning tech? Do they want to go to private equity?
Speaker 4: And so we're trying to remind them to be a
Speaker 4: little bit more balanced and get out of cash.
Speaker 5: What is the moment to get out of cash? What
Speaker 5: do you tell them about when's the time to move?
Speaker 4: I mean for most people it was yesterday or a
Speaker 4: month ago, because you're missing like, yes, cash makes you
Speaker 4: feel good, But most clients I work with still have
Speaker 4: too high of an allocation of cash, and so trying
Speaker 4: to remind them what that drag looks like. And we
Speaker 4: do a lot of analytics showing them if you stay
Speaker 4: at twenty percent cash the next ten years, this is
Speaker 4: what this looks like. Whereas if you go into equities,
Speaker 4: even with the volatility, you may see the outcome is
Speaker 4: significantly better. The highs are higher, the lows are higher.
Speaker 2: Is it just simply the they're looking at four point
Speaker 2: eight percent or whatever they yield is right now?
Speaker 4: Coming off for a long period when when rates were
Speaker 4: so low, it's suddenly they're like, oh, five percent. Like
Speaker 4: if I can make five percent risk free, that's great.
Speaker 4: The problem is you have inflation now, so it's it's
Speaker 4: a little bit different than than it was a few
Speaker 4: years ago. So that's the big challenge. And then of
Speaker 4: course the headlines we're seeing every day that you guys
Speaker 4: are talking about that stresses people out, and so you
Speaker 4: have to remind them it's all about having a plan,
Speaker 4: executing on that plan.
Speaker 2: Not that you know, last night's dinner was a complete
Speaker 2: disaster at home. Holy Mac seventeen year old stomping out
Speaker 2: of the room, Good morning, after thought, How do you
Speaker 2: handle generational arguments in a family office? Please? John? Are
Speaker 2: you taking notes over there? Yeah?
Speaker 5: I think you know you guys should hire like therapist, Yeah,
Speaker 5: to come in.
Speaker 4: We actually do have behavioral exponents work.
Speaker 5: With we're both trying to get for some time now.
Speaker 3: As well as our your strategy team.
Speaker 2: That's what they do, people like Gabriello Santos, that's what
Speaker 2: you do.
Speaker 4: Ends I joke of my job is sort of as
Speaker 4: a therapist.
Speaker 2: How do you do? How do you tell you got
Speaker 2: three kids and a big pot of money. How do
Speaker 2: you say to the one at the F one races
Speaker 2: and Monaco shut up and listen to us.
Speaker 3: Well, first of I don't say that, you know.
Speaker 4: I mean the struggle is helping the next generation recognize
Speaker 4: why why and how their parents view things, what their
Speaker 4: perspective is. But then again, it all comes back to goals, right,
Speaker 4: The parents' goals is different than the kids goals. And
Speaker 4: so what we try to do is it's a crude
Speaker 4: term it say, bucketing. So okay, parents, you're trying to
Speaker 4: do this because you're use this money over the next
Speaker 4: ten years. Your kids are going to use this money
Speaker 4: over the next forty years. They can take more risks,
Speaker 4: they can be a little bit more intrepid. Then you
Speaker 4: might be comfortable being And that's where again, what's the
Speaker 4: right amount of cash for a sixty year old versus
Speaker 4: a twenty year old.
Speaker 3: It's very different. So we've spent a lot of time.
Speaker 2: I catch for the twenty year old is eight hundred dollars.
Speaker 2: And if they go I gotta go to steamboat, you go, Okay,
Speaker 2: twelve hundred that's it.
Speaker 4: And it's you have to keep in mind too, these
Speaker 4: kids that age, they've never don't remember a bigger recession right,
Speaker 4: or more volatile market. And so part of it too
Speaker 4: is educating them on like what happened in two thousand
Speaker 4: and eight and like what that could mean for assets
Speaker 4: and how you think again about investing over the long
Speaker 4: term and sticking with us.
Speaker 5: This is where I want to go, because what what
Speaker 5: do you say about normalcy? What is normal?
Speaker 4: I would argue the last you know, ten years was
Speaker 4: not normal, right, we weren't in a normal rate environment.
Speaker 4: And you know, I see it both with younger clients.
Speaker 4: I work with younger people on my team, like reminding
Speaker 4: them of what volatility is really like and what a
Speaker 4: recession feels like, because while we had a recession in COVID,
Speaker 4: you snap back so quickly, it wasn't really like a
Speaker 4: recession that we've all lived through.
Speaker 2: I have encyclopedic knowledge of every loss I've ever made,
Speaker 2: and I learned fairly early on.
Speaker 5: So multiple encyclopedic.
Speaker 2: So it just keep feelings like the World Book when
Speaker 2: you were kids, and the yes volume is very thick. Now,
Speaker 2: how do you teach family offices and family members to
Speaker 2: win from a loss? How do you sit them down
Speaker 2: and say, you know, we went into it and I'm
Speaker 2: picking on Intel and da da da da did work out?
Speaker 2: How do you teach the lessons of a loss?
Speaker 4: This is actually where I think the family office infrastructure
Speaker 4: can be helpful, because you want someone who's a little
Speaker 4: bit dispassionate, separate from the family. Because the family, they've
Speaker 4: made the money, they worked really hard for it. It's the
Speaker 4: losses they feel it more, whereas their professional team can
Speaker 4: be a little bit less emotional about it. And so
Speaker 4: I work with both parts of the team to help
Speaker 4: the family get comfortable, but also help the family office
Speaker 4: create a plan and stick to that plan. How do
Speaker 4: you handle a loss? Risk management? So again, we're not
Speaker 4: going to get everything right. We're not going to get
Speaker 4: a lot of things right. But if you know when
Speaker 4: to pull the ripcord and step aside and then wait
Speaker 4: and go back in, that's the best way you handle
Speaker 4: losses because we're all going to have them. It just
Speaker 4: you don't want to get married to positions. You want
Speaker 4: to get married to trades and just have some sort
Speaker 4: of institutionalized process. For me, it's most of my clients, Hey,
Speaker 4: down ten percent, we re under it. Do we really
Speaker 4: like this if we do, you got to buy more.
Speaker 4: If you're not willing to buy more down ten, then
Speaker 4: what are you doing in that trade?
Speaker 5: On the long list of things, you have to pay
Speaker 5: attention to risks that you're looking at, what's near the top.
Speaker 5: So today we'll have J. Powell opining before the Congress,
Speaker 5: maybe trying not to fine on too much before the Congress.
Speaker 5: We have these tariffs announcements, retributive tariffs. What are you
Speaker 5: most worried about? What has the most kind of determinism
Speaker 5: for your outlook right now?
Speaker 4: I mean, if we're talking about equity outlook, Clearly valuations
Speaker 4: are high, and so our investor is going to be
Speaker 4: willing to pay twenty north of twenty times for US
Speaker 4: companies in a world where there's so much volatility in
Speaker 4: the headlines and where we don't know where the FED
Speaker 4: is going, and people are worried about inflationary risks. So
Speaker 4: for me in US equities, certainly the valuation risk. Actually,
Speaker 4: earnings look pretty good. We're in earning season. The numbers
Speaker 4: are good, but I don't know that we can maintain
Speaker 4: that high multiple, and so that's the risk on our side.
Speaker 4: If you look at our bare case, we're assuming you
Speaker 4: could see multiple contraction. That's how you get south of
Speaker 4: five thousand. Again, I think that's low probability, but that's
Speaker 4: the risk to that.
Speaker 2: Are people really in twenty percent cash? Yeah?
Speaker 3: Now again it's for people.
Speaker 1: It all.
Speaker 4: There's value in something that makes you feel good, like
Speaker 4: that helps you sleep at night. Okay, but again I
Speaker 4: got to put the numbers behind it.
Speaker 3: And you what that dragged us to your portfolio? It's
Speaker 3: it's not good.
Speaker 2: Do you have a gold vault under the new building?
Speaker 2: I mean gold's popping three thousand and now? Is there
Speaker 2: the Descenzo Lord Norman has built a gold vault gold?
Speaker 4: I don't percently have a gold vault gold right now.
Speaker 4: We've been talking about gold for a couple of years now.
Speaker 4: I was up twenty twenty eight percent or so last year.
Speaker 4: I think it's really after twenty eight percent run hard
Speaker 4: to go long out right. That said, I have clients
Speaker 4: who don't have very high allocations. What we've been doing,
Speaker 4: there's interesting skew and gold. People are still trying to
Speaker 4: buy calls to buy upside. So if you own gold
Speaker 4: out right right here, you want to buy some, you
Speaker 4: can coller that position cashless. The most you can lose
Speaker 4: in the year is five percent. The most you can
Speaker 4: gain is thirteen percent. That's an interesting.
Speaker 2: Family office is in collars.
Speaker 4: Yeah, your gold, call your gold your goal because by
Speaker 4: the way, if you make thirteen percent gold, that's more
Speaker 4: than I think you're going to make an use equities
Speaker 4: and that's gold.
Speaker 2: Great. Have you ever broken a phone? Have you plan
Speaker 2: I phone?
Speaker 4: I am I'm Italian, I have a hot temper, so yes.
Speaker 2: Yes, okay, thank you. Now we got to the Dirk
Speaker 2: Modica descenzo. Thank you, thanks you so much. Really appreciate it.
Speaker 2: Head of breaking telephones, JP Morgan really in particularly those
Speaker 2: comments on the heritage of JP Morgan coverage of our
Speaker 2: media business years ago.
Speaker 1: You're listening to the Bloomberg Surveillance podcast. Catch us Live
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Speaker 2: I have been remiss, remiss, remiss. We really ignored the
Speaker 2: bond market because it's a sleep, which means ratear up.
Speaker 2: We are thrilled at Megan Robson is whether she's US
Speaker 2: Credit Strategy b MP Perry ba I mean, there's a
Speaker 2: certain you know, I go back to your brown economics
Speaker 2: with Bill Poole and all that, there's a certain point
Speaker 2: where you link in economics and politics into your bond call.
Speaker 2: Do you have to change b MP perry back credits
Speaker 2: strategy with all that's going on in Washington.
Speaker 6: A lot of cross currents right now. But for credit,
Speaker 6: surprisingly the two factors that have driven markets are actually
Speaker 6: outside of politics. So supply demand very well in balance,
Speaker 6: and credit quality also very well in balance. So I
Speaker 6: think there is this expectation that some of these headlines
Speaker 6: related to tariffs should start to drive credit spreads, but
Speaker 6: so far we've seen the opposite.
Speaker 2: So spreads haven't reversed.
Speaker 3: They're still spreads.
Speaker 2: If you look at me put it in English, they
Speaker 2: price to perfection, if.
Speaker 6: If I think that's that's fair to say, definitely pricing
Speaker 6: in the credits soft landing. Since the election, IG credit
Speaker 6: spreads have been within seven basis point range, so very
Speaker 6: narrow range. Meanwhile, you've seen the interest rate markets ten
Speaker 6: year treasury, a lot of volatility around that, and of
Speaker 6: course you look at it, I go.
Speaker 5: To translate that, please, I'm waiting for.
Speaker 2: That whole faith and credit US ten year yield and
Speaker 2: a corporate quality ten year yield is point zero seven
Speaker 2: percent higher yield.
Speaker 6: So the absolute spread now is closer to eighty basis points,
Speaker 6: but the range within it's traded so it's bounced between
Speaker 6: seventy four and eighty one roughly. So that very narrow
Speaker 6: range that we've traded within, or the band we've traded in,
Speaker 6: has been extremely tight, and I think it speaks to
Speaker 6: the strength of the technicals, supply demand being very well
Speaker 6: in balance. And then of course the credit cycle. We're
Speaker 6: not seeing signs of excesses. Things like corporate leverage has
Speaker 6: been very stable. We actually saw it move lower last year,
Speaker 6: and interest coverage has come down but near the long
Speaker 6: term median, So I think that's contributed to the stability
Speaker 6: that we've seen.
Speaker 5: To borrow a phrase from Tom, how does a pro
Speaker 5: like you navigate all these announcements from the President when
Speaker 5: it comes to tariffs, be they the piece is that
Speaker 5: he's going to do something or assign some executive order
Speaker 5: or the executive orders themselves indicating there's going to be
Speaker 5: a study or new tariffs in thirty days time, how
Speaker 5: do you sort of forecast out what those headwinds might
Speaker 5: be if in fact we see them.
Speaker 6: So we're not expecting headlines to drive the market at
Speaker 6: a top down level, but there are a lot of
Speaker 6: sector implications, so we've really tried to zero in and
Speaker 6: focus on which sectors might be more or less exposed
Speaker 6: in the market. So looking at supply chains, looking at
Speaker 6: direct revenue exposure abroad, if you saw tip for tat tariffs,
Speaker 6: our starting points for sort of identifying those vulnerabilities. So
Speaker 6: we have as an example, for example, autos investment grade
Speaker 6: auto sector very intertwined with Canada and Mexico. In our
Speaker 6: base case, we're not expecting tariffs on Canada and Mexico
Speaker 6: to actually pan out, but if they do, that's a
Speaker 6: sector that would be much more exposed.
Speaker 2: Well as just as a side I looked at the chart,
Speaker 2: I can't remember from who. Overnight aluminum is basically Canada.
Speaker 2: I mean, it's a little bit of China, but everybody's
Speaker 2: got like an alphabet super countries like South Korea. South
Speaker 2: Korea is teen Swedens, I mean Canada. When we do
Speaker 2: aluminum tariffs, we're doing Canadian tariffs, thank you.
Speaker 6: And there's a lot of there's a lot of issuers
Speaker 6: in the US credit indices that are actually based in
Speaker 6: Canada are domiciled in Canada, so of course those issuers
Speaker 6: are much more vulnerable if we see tariffs heat up.
Speaker 6: I think another area building products. So in the high
Speaker 6: yield market, this is a sort of trifecta of policy
Speaker 6: risk because you have higher mortgage rates, which is already
Speaker 6: weighed on the sector. You have potential immigration issues, so
Speaker 6: a lot of the building sector is exposed to undocumented labor.
Speaker 6: And then also some exposure to tariffs as well if
Speaker 6: we see things like a tariffs on steel. So that's
Speaker 6: another place that we would avoid. And then if you
Speaker 6: think of about sort of hiding out, think about the
Speaker 6: services sector, So healthcare much lower exposure. We're overweight investment
Speaker 6: great healthcare. In the high yield market, we like cruise lines,
Speaker 6: so sector where you're exposed more to the high end
Speaker 6: consumer and services versus goods.
Speaker 5: I want to ask you to react to something that
Speaker 5: we heard last week when our colleague Silimo's and sat
Speaker 5: down with Scott Bess and the new Corenitury secretary. She
Speaker 5: asked about how he's thinking about what the FED is
Speaker 5: doing or isn't doing, and he said the thing that
Speaker 5: he's paying the most attention to is the tenure. What
Speaker 5: do you make of that? What should we make of
Speaker 5: the fact that he's kind of giving that premacy. That's
Speaker 5: the thing that he's mostly focusing on.
Speaker 6: So I think that the administration is not going to
Speaker 6: be able to adjust the FED funds rate like though
Speaker 6: you might want to, although it might want to, And
Speaker 6: so they do in in some way have control over
Speaker 6: the ten year if you think about the term premium,
Speaker 6: if you think about fiscal deficits and so if they
Speaker 6: are able to sort of reduce the fiscal deficit, that
Speaker 6: could bring down the ten year a bit. And if
Speaker 6: you think about the constituency, they care about their mortgage rate.
Speaker 6: If you can bring down the tenure, that is a
Speaker 6: gift to the constituency and would probably be a very
Speaker 6: popular popular item.
Speaker 2: So, based on this conversation, you're taking off the summer.
Speaker 6: We'll see it's range both.
Speaker 2: I mean, it's cool if there's a real stability to
Speaker 2: its way.
Speaker 6: Yeah, No, there's a definite carry element. We like the
Speaker 6: triple big where you can get a lot of carry,
Speaker 6: and then the leverage loan market. If the FED does
Speaker 6: stay on hold, it's an attractive carry profile.
Speaker 2: Mean thank you Megan Robinson with this BMP prairi about
Speaker 2: it ahead of US credit strategy.
Speaker 1: This is the Bloomberg Surveillance Podcast. Listen live each weekday
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Speaker 2: We are honored to bring you today someone who grew
Speaker 2: up in the shadow of KMOX in Saint Louis. One
Speaker 2: of my high points was being interviewed by KMOX with
Speaker 2: a plaque Abraham Lincoln on the wall. This is where
Speaker 2: Abe did whatever he did. He came to New York
Speaker 2: and has made a good go of it, and it
Speaker 2: could be a four hour interview today David Gura with
Speaker 2: mister Lander.
Speaker 5: Brad Lander. Great to see you and definitely want to
Speaker 5: talk about your campaign and your platform. But I have
Speaker 5: to start with the news of the day, and that
Speaker 5: is this memo that came to light The Times first
Speaker 5: reported last night from the Justice Department to the US
Speaker 5: Attorney's Office in New York, instructing that office to drop
Speaker 5: the charges against the current mayor, Eric Adams. I wonder
Speaker 5: what you make of that directive. Obviously you have an
Speaker 5: acting US attorney now he's in a very difficult position
Speaker 5: whether to take that advice and alienate probably the entire
Speaker 5: staff within that office, or go along with it. I
Speaker 5: guess under the expectation that whoever succeeds her, be that
Speaker 5: Jay Clayton or someone else, is likely to put a
Speaker 5: rubber stamp on it. What do you make of the news?
Speaker 5: What does it tell you about the case that this
Speaker 5: office is built against mayor?
Speaker 7: What an outrageous miscarriage of justice. The Southern District has
Speaker 7: a tremendous history for doing corruption prosecution, and this says, no,
Speaker 7: we want you to do corruption instead. They had a
Speaker 7: strong case. They're not even saying the evidence in the
Speaker 7: case isn't strong. You know, they know he took illegal
Speaker 7: campaign contributions, corrupted the building's department, but they just want
Speaker 7: to wreck the justice system, and unfortunately New Yorkers are
Speaker 7: going to pay the consequences.
Speaker 5: Do you think that the mayor should resign? There's this
Speaker 5: swirl now about should he be partnered to he not
Speaker 5: have these charges brought against him? Should he step down
Speaker 5: given what's happened here. Yes, he should resign. He's effectively
Speaker 5: being extorted by the Justice Department. He's only looking out
Speaker 5: for the interests of one New Yorker and that's himself,
Speaker 5: not even speaking up when they come to take our
Speaker 5: lunch money. There are many layers to this. It's a
Speaker 5: two two page memo. I should say the acting Deputy
Speaker 5: Attorney General is an alumnus of this office of the
Speaker 5: sd and I which may SDNY, which makes us even
Speaker 5: more astonishing. But there's a line a footnote buried in it,
Speaker 5: which I flagged on Twitter and all the other platforms
Speaker 5: last night, and it's just find it to be like
Speaker 5: an astonishing footnote. Quote your office correctly noted in the
Speaker 5: February third, twenty twenty five memorandum. Quote, as mister beau
Speaker 5: emil Bow, the Acting Deputy Turned General, clearly stated to
Speaker 5: Defense Council during our meeting on January thirty first, twenty
Speaker 5: twenty five, the government is not offering to exchange dismissal
Speaker 5: of a criminal case for Adams's assistance on immigration enforcement.
Speaker 5: A lot of absurdity baked in there, and just the
Speaker 5: way that that's constructed. But this is something that you've
Speaker 5: homed in on in recent days. That is, was there
Speaker 5: some sort of deal broker between the mayor and the
Speaker 5: president in mar Lago or elsewhere? It sure looks like it.
Speaker 7: Elsewhere in the memo it says we're doing this so
Speaker 7: that the mayor can get back to the business of fighting.
Speaker 5: Quote unquote illegal immigration.
Speaker 7: His job is to protect New Yorkers, not to do
Speaker 7: the president's bidding.
Speaker 2: Do you agree? Is David Gurrows more up to speed
Speaker 2: on this than I am? And in Christmaster Landers, so
Speaker 2: are you that the way the language is formed, there's
Speaker 2: a threat to the mayor if you don't guess what
Speaker 2: we say. Going to bring those charges.
Speaker 7: Back dismissed without prejudice means we will be watching every
Speaker 7: step of the way, and if we're dissatisfied with your
Speaker 7: fealty to the Trump White House, see we'll bring the charge.
Speaker 2: The difference is Landers studied this at Chicago. I got
Speaker 2: it from Perry Mason. That's a difference.
Speaker 5: I can't help but draw a line to what now
Speaker 5: former President Biden did in the final days of his administration,
Speaker 5: making these preemptive pardons to his son and others. Look,
Speaker 5: President Trump could have done the same thing. But there
Speaker 5: is a flex a power move here.
Speaker 2: In doing this.
Speaker 5: You talked about the long standing independence and proud independence
Speaker 5: of the SDN Y. He's testing them effectively by doing this,
Speaker 5: I mean move fast and break things. He's breaking the
Speaker 5: Justice Department and the tradition of independent prosecution that the
Speaker 5: Southern District of New York has long had, and that'll
Speaker 5: mean more corruption. You say he should resign. There's another
Speaker 5: means of recourse here. If he doesn't do that, you
Speaker 5: other Democrats could go to the governor of the State
Speaker 5: of New York or to Cathy Hoakland say, look, you
Speaker 5: have the power to do you get him to step aside,
Speaker 5: perhaps force and to step aside. Is that something that
Speaker 5: you and your fellow Democrats are thinking about and indeed
Speaker 5: would consider it this moment because of all of this.
Speaker 7: I mean, the form of removal I'm focused on right
Speaker 7: now is the ballot box New Yorkers can get rid
Speaker 7: of Eric Adams and restore integrity and effective government to
Speaker 7: city hall. I mean, people are fed up not just
Speaker 7: with his corruption, but with his failure to deliver. People
Speaker 7: are fed up with democratic mayors of big blue cities
Speaker 7: who can't govern and that's what we can elect this year.
Speaker 5: I want to get to your platform. One last question
Speaker 5: on this, based on what you just said there in
Speaker 5: that memo, is this criticism of this case being brought
Speaker 5: close to an election. I guess nine months out now
Speaker 5: from an election is too close for comfort for this
Speaker 5: Justice Department. As you look at this campaign, how do
Speaker 5: you see this story being a through line? Perhaps the
Speaker 5: through line is you campaign and your fellow Democrats campaign
Speaker 5: against him. I mean, New Yorkers know that Eric Adams
Speaker 5: has run a corrupt administration. I think it's twenty six
Speaker 5: members of his administration have either been indicted or under instigation,
Speaker 5: including him. But he also has been failing to deliver
Speaker 5: on affordable housing, on public safety, on childcare, on just
Speaker 5: making the government run well. So those will go together.
Speaker 7: What New Yorkers want is a safer, more affordable, and
Speaker 7: better run city, and that I think will be the
Speaker 7: through line of this campaign. That's why I'm running for
Speaker 7: all your nationwide.
Speaker 2: In your morning commune on Apple, car Play, Android Auto,
Speaker 2: or a new digital platform YouTube, Good morning, and subscribe
Speaker 2: to Bloomberg Podcasts. An extensive conversation of our David Gura
Speaker 2: with brad Lander. He counts the beans in New York.
Speaker 2: He's a controller. But far, far more of that is
Speaker 2: David goes to your campaign. I want to frame this,
Speaker 2: I said to a family member. Finally, whether you're a
Speaker 2: Republican or Democrat. The former mayor of Chicago Ram wrote
Speaker 2: an essay in the Washington Post, Democrats have become the
Speaker 2: party of permissiveness. That's ballot box poison. You have a
Speaker 2: history of progressivism. How does the left in the Democratic
Speaker 2: Party migrate to the center to compete?
Speaker 7: Yeah, I mean, I want to give you some straight talk.
Speaker 7: I think progressives, including myself, we're slow to respond to
Speaker 7: rising disorder and crime coming out of the pandemic, and
Speaker 7: we need to be real clear about it. So the
Speaker 7: number one commitment of my campaign is to end street
Speaker 7: homelessness for people with serious mental illness in New York
Speaker 7: City who are on the streets and subways. That is
Speaker 7: something a mayor could do. I've laid out a really detailed,
Speaker 7: ready on day one plan. Some of that is involuntary hospitalization,
Speaker 7: a lot of that is connecting people to housing and
Speaker 7: services so they're not on the subways or on our
Speaker 7: stoops a danger to themselves.
Speaker 5: And to others. You know, Tom and I travel, we
Speaker 5: go to Washington, go elsewhere, And I think a lot
Speaker 5: of people like to rag on New York, like to
Speaker 5: bring up the fact that they think that the subways
Speaker 5: are unsafe, that there is a sense of a lack
Speaker 5: of good public safety in the city right now. And
Speaker 5: you can bring up statistics to push against that, But
Speaker 5: how do you deal with that feeling. What's in the
Speaker 5: zeitgeist here that if you're riding the subway there is
Speaker 5: a danger that something.
Speaker 7: Could happen to you are true. I mean, we have
Speaker 7: more private sector jobs, more office using jobs than ever
Speaker 7: in the city's history. People do want to be here.
Speaker 7: But if you're on the subway and you just heard
Speaker 7: the story that an unwell person, a mentally ill person
Speaker 7: push someone onto the tracks, and then you see a
Speaker 7: homeless person who's mentally ill in your car, of course
Speaker 7: you're anxious. I have a friend whose eight year old
Speaker 7: daughter was pushed to the ground last week. So it's
Speaker 7: a real issue and a perception issue. But what we
Speaker 7: do is get those people connected to housing and services
Speaker 7: so they're not riding the subways where it's not good
Speaker 7: for them and it's not good for writers in New
Speaker 7: York City. That ends street homelessness for people with serious
Speaker 7: mental illness will be a proud New York and one
Speaker 7: that could show all those critics look at how well
Speaker 7: we're doing. But that takes a new mayor, and that's
Speaker 7: what I'm running for.
Speaker 5: How do you look at the relationship when it comes
Speaker 5: to transportation between New York City and the state government,
Speaker 5: and of course the governor has weighed in on what
Speaker 5: needs to happen on subways to make them more safe.
Speaker 5: How important is that relationship. What would you do to
Speaker 5: improve that to sort of harness that effective way to
Speaker 5: make things safer.
Speaker 7: I mean the city state relationship to make the subways
Speaker 7: around well as critical. This is why I was a
Speaker 7: big proponent of congestion pricing, and when the governor put
Speaker 7: it on pause, I help bring the lawsuits that sued
Speaker 7: to get it implemented. But of course now we're working
Speaker 7: closely together to make sure it's implemented well. The numbers
Speaker 7: are great so far. Travel times are down, traffic is down,
Speaker 7: money is more people are on the subway. Now the
Speaker 7: city and state have to work together to deliver platform barriers,
Speaker 7: new station gates, new subway elevators, modern signal system, all
Speaker 7: the things that we have to work together to make
Speaker 7: sure it works.
Speaker 2: I'm going to cut to the chase. It's real simple.
Speaker 2: I live in a fancy part in New York where
Speaker 2: I enjoyed a cigar in the street and one day
Speaker 2: there's seven police officers around me all of a sudden.
Speaker 2: And again it's crime that you mentioned. It's the issue.
Speaker 2: It's almost like Nixon sixty eight to seventy whatever. Brad Lander,
Speaker 2: how are you going to have a relationship with the NYPD?
Speaker 2: How do you form that is mayor versus being counter
Speaker 2: going after contracts.
Speaker 7: I mean, this is an important moment. I have to say,
Speaker 7: Jesse Tish, who's now and there is police commissioner, is
Speaker 7: doing a great job so far both doing reform, holding
Speaker 7: people accountable, and providing support.
Speaker 5: And that's the survivor of this administration.
Speaker 7: I mean, honestly, the fact that the mayor's corruption has
Speaker 7: opened up an opportunity for reform is great. But I
Speaker 7: would love to keep Jesse Tish as commissioner. I think
Speaker 7: she's got the right tone of accountability and rebuilding and
Speaker 7: reform ins.
Speaker 2: I need you to go out to Stanton Island next
Speaker 2: to where Mandolin Brothers was years ago. I need you
Speaker 2: to go to Stanton Island and bond with people that
Speaker 2: look at progressives and go, you gotta be kidnaped. How
Speaker 2: do you do that when I go?
Speaker 7: So this is a connection from being being counter. I
Speaker 7: work with the Police Pension Fund to manage their pension.
Speaker 7: So there was an officer, officer Fayaz, who the mayor
Speaker 7: wouldn't allow to get line of benefit due to line
Speaker 7: of duty benefits, and my office did.
Speaker 5: I worked with the Police.
Speaker 7: Pension Fund to make sure those officers who had long
Speaker 7: COVID could actually get their disability benefits. So I've got
Speaker 7: a track record of working with the union reps. I hope,
Speaker 7: you know, I'll bring them out with me to Staten
Speaker 7: Island when I go to have that meeting, and I
Speaker 7: hope to do it, you know, in a way that shows,
Speaker 7: of course, we want to support our officers. Everyone wants
Speaker 7: accountability from people who do the wrong thing, from cops
Speaker 7: and from elected officials.
Speaker 5: I've got three kids in public school in this city.
Speaker 5: As much as there's been a rotating cast of police commissioners,
Speaker 5: you've had a rotating cast of chancellors as well. What
Speaker 5: are your top line plans for this the hugest school
Speaker 5: system in the country here to stabilize it. You know,
Speaker 5: one of the reasons, candidly why we moved to New
Speaker 5: York was the prospect of having universal pre K funding
Speaker 5: has been an issue here in recent years. Your your perspective,
Speaker 5: your platform when it comes to the schools.
Speaker 7: Yeah, my kids also went from pre k to twelfth
Speaker 7: grade in the New York City public schools, and they
Speaker 7: were lucky to have good schools. But boy, not everybody
Speaker 7: does so. Look a school's chancellor who recruits principles and
Speaker 7: superintendents who support their teachers but also hold them accountable.
Speaker 7: The state has increased the money we're getting. That's an
Speaker 7: opportunity to reduce class size, which is something that this
Speaker 7: mayor's promised to do but really hasn't done yet. It's
Speaker 7: going to be on the next mayor to reduce class
Speaker 7: size with the money the state is giving.
Speaker 2: Us and for our audience. Afterthought, when she was in
Speaker 2: elementary school here in the Island of Manhattan, there were
Speaker 2: eleven languages in her first grade class. I think you
Speaker 2: have to, as David says, did you say three off three? Now?
Speaker 2: I had no idea. I mean, that's what's remarkable about
Speaker 2: this city.
Speaker 5: What other place has that?
Speaker 2: Well, we're working at it. Ok kmox. She grew up
Speaker 2: with the Cardinals. It's just like I used to listen
Speaker 2: from Western New York bouncing off the ironsphere. If somebody
Speaker 2: said to me my ten great moments. One of them
Speaker 2: was a guy named Mario Cuomo talking to the former governor,
Speaker 2: and we said good morning to him in his family
Speaker 2: about his time with the Pittsburgh Pirates. It was magical.
Speaker 2: Heir Mario Cuomo talk about the Pittsburgh Pirates. One of
Speaker 2: his offspring may enter the race or is in it.
Speaker 2: I'm not sure the details. Is it too crowded a field?
Speaker 2: I mean, how away from Mayor Adams upset? How do
Speaker 2: you frame September in October to b I mean, how
Speaker 2: do you frame into.
Speaker 5: It elections in June?
Speaker 2: So you've been sooner.
Speaker 7: I don't think New Yorkers will want to replace one
Speaker 7: corrupt chaos agent with another. This is someone who resigned
Speaker 7: in disgrace just ahead of impeachment after a dozen women
Speaker 7: who worked for him accused him of sexual harassment, who
Speaker 7: sent thousands of seniors to their deaths and nursing homes,
Speaker 7: and then lied to their families about it to protect
Speaker 7: his five million dollar book deal. Who cut the subways,
Speaker 7: Who cut a thousand in patient psychiatric beds, Who doesn't
Speaker 7: care about New York City where he hasn't lived in
Speaker 7: twenty five years. We're getting rid of one corrupt chaos agent,
Speaker 7: not bring another in.
Speaker 5: When you look at this field of challengers to the mayor,
Speaker 5: Democratic challengers, what are we going to sort out here?
Speaker 5: This is going to be a robust debate, I imagine,
Speaker 5: about the future of the Democratic Party here here in
Speaker 5: New York. It's to be part of this broader conversation
Speaker 5: about it here in the US. How important is it,
Speaker 5: How vital is it to have that conversation right now?
Speaker 5: What are we going to learn from from this this
Speaker 5: this primary campaign?
Speaker 7: Yeah, it's critical. And part of the reason in New
Speaker 7: York people shifted to voting for Trump is they haven't
Speaker 7: seen government working for them and there is doubt about
Speaker 7: whether Democrats can govern big blue cities. Well, folks like
Speaker 7: Michelle Woo are doing it in Boston. We have to
Speaker 7: do it in New York City. Get the cost of
Speaker 7: living under control, confront and build affordable housing, deliver on
Speaker 7: that childcare and universal pre K and three K, and
Speaker 7: make the city safer.
Speaker 2: Are we going to have a gilded age campaign? Michell
Speaker 2: Wu in Boston's running against the Craft offspring. You know,
Speaker 2: you know there's the fair amount of money rolling around here.
Speaker 2: How do you frame out this path to June? You know,
Speaker 2: I assume how many people are in the race.
Speaker 7: We know right now, so there's eight or so, and
Speaker 7: we'll see about Plomo getting in. What do you perceive
Speaker 7: may to be like, I mean, it's going to be
Speaker 7: busy for me. It's going to be a question about
Speaker 7: who people think can actually run the city well. And
Speaker 7: that's the track record I have as the city's chief
Speaker 7: financial officer, with a history of actually delivering. We managed
Speaker 7: two hundred and eighty five billion dollar pension fund. Our
Speaker 7: audits have saved hundreds of millions of dollars. I can
Speaker 7: make government work, and I think that's what New Yorkers want.
Speaker 5: We come full circle. Brought that memo at the top.
Speaker 5: I read that footnote which had that innuendo about immigration policy,
Speaker 5: and let's end there. And you know, a few weeks back,
Speaker 5: I was out at Floyd Bennettfield and saw the shelter
Speaker 5: that had been built there. I gather it's being emptied
Speaker 5: out or has been emptied out off of migrants moved
Speaker 5: to New York City. How do you approach this issue,
Speaker 5: which is one that I think is flum mixing a
Speaker 5: lot of people. Here we are in a city that
Speaker 5: has historically welcomed so many. Now we have a federal
Speaker 5: administration that is wanting to constrict that. What is the
Speaker 5: duty of the mayor of this city here at this
Speaker 5: moment where we've had this influx of people here and
Speaker 5: a lot of people who are have left their home
Speaker 5: countries in great pain. Yes, many without documents have come
Speaker 5: here to New York. What's the mayor to do?
Speaker 7: Yeah, I mean New York City obviously doesn't control a
Speaker 7: border policy. That's you know, federal. But what New York
Speaker 7: City can do is help those folks get to work.
Speaker 7: I mean, we need people working in construction, in our restaurants,
Speaker 7: in a home care, in healthcare. So helping folks who
Speaker 7: have work authorization get to work. Helping folks get work
Speaker 7: authorization critical. And then we can't allow ice to come
Speaker 7: into our schools, into our public hospitals. The Brooklyn district
Speaker 7: attorney told this amazing story about how when his brother
Speaker 7: was murdered, which is why he became a prosecutor, it
Speaker 7: was somebody undocumented who was a witness, and the defense
Speaker 7: got that guy deported and.
Speaker 5: There was no justice.
Speaker 7: And you know, that's what we need, is a city
Speaker 7: that's keeping at the place where your daughter has eleven
Speaker 7: languages in her preschool class, but we also make it
Speaker 7: work for a thriving economy in a safe, successful city.
Speaker 2: It was unbelievable the first time I walked into that classroom,
Speaker 2: five twenty nine, eleven languages, It is just just yeah,
Speaker 2: it was you know, forget about Ellis Island and all
Speaker 2: the emotion of a city, you know, you think of
Speaker 2: Italy and the Jewish community decades ago. To witness in.
Speaker 5: Real time eleven.
Speaker 2: Languages in a perfect five twenty nine school up on
Speaker 2: the East Side, it was absolutely unbelievable. One of the
Speaker 2: great moments. Two kids from Bangladesh not a word of English,
Speaker 2: and those teachers went into it every day. Would you
Speaker 2: say goodbye to mister Landers.
Speaker 5: Comptro for New York City candid from mayor here and
Speaker 5: you're great to see you. Jack Buck is smiling on
Speaker 5: us Oky. Oh there you go.
Speaker 2: Jack Buck is smiling at us.
Speaker 5: Brad, there's a pothole.
Speaker 2: How many times a week do you get that? A lot?
Speaker 2: A lot? Yeah, Thank you so much and best of luck.
Speaker 2: I hope to have you back here as we stagger
Speaker 2: to June.
Speaker 1: This is the Bloomberg Surveillance Podcast. Listen live each weekday
Speaker 1: starting at seven am Eastern on Applecarplay and Android Auto
Speaker 1: with the Bloomberg Business app. You can also watch us
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Speaker 2: Mark McCormick is a Toronto Dominion Bank TD Securities and
Speaker 2: what's so important here is McCormick was one of the
Speaker 2: first people to scream dollar resiliency and dollar strength borderline
Speaker 2: years ago. He joins us today with an incredibly important
Speaker 2: note out of Toronto, Stereotypes of a global trade order misunderstood. Mark,
Speaker 2: what are you focused on this morning in our new
Speaker 2: trade war?
Speaker 8: Thanks for having me. Yeah, I think the number one
Speaker 8: thing I'm focused on is the dislocation between the tracking
Speaker 8: of trade policy and certainty, which there's really good indicators
Speaker 8: on that that you could pull now versus the generally
Speaker 8: i'd say subdued macro volatility and the generally subdued risk
Speaker 8: conditions that we see in our risk model. So I
Speaker 8: think there's those things are kind of moving in the
Speaker 8: wrong direction where trade policy and certainty is at cyclical highs,
Speaker 8: and you know, risk volatility and market volatility is generally contained.
Speaker 8: So I think that is what's going to fall apart
Speaker 8: pretty soon.
Speaker 2: On the classic game theory, Good morning, doctor l Arian
Speaker 2: and Cambridge on the game theory of Tit for Tat.
Speaker 2: It's like tennis, back and forth and back and forth.
Speaker 2: Where on your calendar does the tit for tat really
Speaker 2: click in? Is it March or is it August?
Speaker 8: I'd say it's March April right now, there's probably i'd
Speaker 8: say a rolling three month calendar on the trade uncertainty,
Speaker 8: so you kind of have these, you know, these understandings
Speaker 8: of the first hundred days are very important to kind
Speaker 8: of set the agenda, to figure out where the politics
Speaker 8: and all the markets are going around. So I'd say
Speaker 8: April's a good one, and then another three months following
Speaker 8: that will be kind of the key benchmarks. And again,
Speaker 8: wedged in between all of this, we're still looking at data.
Speaker 8: We're still looking at economics, and we're still looking at
Speaker 8: the macro drivers, which are still very bullish for the dollars.
Speaker 8: So there's a lot of conditions that are favorable for
Speaker 8: the dollar mark.
Speaker 5: How do you figure out how do you game out
Speaker 5: what's going to happen with these tariffs if what's really unclear,
Speaker 5: at least to me, is what the objectives of them are.
Speaker 5: We've been through the first round of this with Canada
Speaker 5: and Mexico, China as well. I was up in Toronto
Speaker 5: talking to Christian Freeland is making a run for the
Speaker 5: Liberal Party leadership there, and after a point blank what
Speaker 5: could Canada do to forestall these tariffs from going into place?
Speaker 5: And I gather that the Prime Minister had a constructive
Speaker 5: conversation with Donald Trump that postponed those for thirty days.
Speaker 5: But there is this X factor here of what needs
Speaker 5: to happen to get them off the table, and how
Speaker 5: does that complicate the work that you're doing thinking about
Speaker 5: the effect that it's going to have on markets.
Speaker 8: Yeah, I think that's an important question because it goes
Speaker 8: back to the note of Tom reference and it's really
Speaker 8: about the why why is there discussion around all these
Speaker 8: things that I think if you work backwards. From where
Speaker 8: we're starting from is I think a lot of this
Speaker 8: comes back to the FX market. I'm clearly biased, because
Speaker 8: you know, we're a currency strategy team when we think
Speaker 8: that everything matters for the FX market. But I think
Speaker 8: if you look at some of the things that are
Speaker 8: critically important, when you look at international relations, the world
Speaker 8: has been talking about globalization for over a decade, and
Speaker 8: if you look at globalization indicators that we've been tracking,
Speaker 8: installed economic trade, globalization, those things have not moved. They've
Speaker 8: been sideways since two thousand and nine, since twenty ten.
Speaker 8: So I think if you look at this, this is
Speaker 8: a recalibration of the global trade order. So if you
Speaker 8: want to work backwards, this is an elimination of the
Speaker 8: US trade deficits, This is reindustrialization of the US. And
Speaker 8: this is also what is pursuit of a week er
Speaker 8: dollar policy, or at least an elimination of the extreme
Speaker 8: overvaluation of dollar. So I think tariffs are only basically
Speaker 8: they're just a piece of this. They're not the end itself.
Speaker 8: There are a means to basically adjust the trading order
Speaker 8: and get everyone climb at the negotiating table. So that's
Speaker 8: the way we're looking at this, and again the way
Speaker 8: that this works is there's more asymmetry in favor of
Speaker 8: the US. To start all of this out.
Speaker 2: A frame out for is looney here right now? Just
Speaker 2: getting very quickly here, what does the TD Securities call
Speaker 2: on weak loony?
Speaker 8: Yeah, that's good, it's great because we actually have an
Speaker 8: open idea. We are basically long dollar CAD on a
Speaker 8: three month call option. It's a pretty simple idea or
Speaker 8: I'm sorry, call footspread. Essentially, what we're doing is we're
Speaker 8: looking for a dollar CAD to kind of go through
Speaker 8: the max pressure right now. I think what's very important
Speaker 8: when you think about the trade and policy and certainty
Speaker 8: and the volatility in markets. As I mentioned, we don't
Speaker 8: see a lot of this actually priced in. We don't
Speaker 8: think the markets have taken interesting to seriously, especially for
Speaker 8: a currency like CAD. You know, we do this through
Speaker 8: multiple different ways. We look at different models, different tools,
Speaker 8: but basically, for currencies like CAD in the Mexico pays,
Speaker 8: we don't see the trade and policy of priced.
Speaker 2: In the market. It's all great, but Ger and I
Speaker 2: are just trying to get two nights at the Sheraton
Speaker 2: at Agara Falls, take the mark helping the Canadian side
Speaker 2: or the US the Canadian side, it's the only thing
Speaker 2: you go. You go to Canadian side, they pour a
Speaker 2: better drink. Mark. It's real simple. I got a one
Speaker 2: forty three looning. Are you telling me a linear function
Speaker 2: out to a weaker Canada one fifty?
Speaker 8: Yep, that's exactly it. Sadly, I just came back from
Speaker 8: a kid's soccer tournament in Florida, so I was on
Speaker 8: the opposite side.
Speaker 2: Of that h transaction.
Speaker 8: The dollar dat, yes, crushed. So yeah, we're looking for
Speaker 8: one fifty in the in the next six weeks. That's
Speaker 8: actually essentially our targets. We get to one forty eight
Speaker 8: within the next month, and I think most of the
Speaker 8: pressure is going to come through the Canadian dollar right
Speaker 8: now and then euro China next.
Speaker 2: Like what did the goofy breakfasts costs you at Disney World.
Speaker 8: It's so probably twenty five CAD to kind of go out,
Speaker 8: And yeah.
Speaker 2: There's a real conversation about understanding there. You've been there
Speaker 2: being a fam just got back. It's there. Mark McCormick.
Speaker 2: The first time I saw you were in the food
Speaker 2: court reading Stanley Fisher nineteen ninety eight. Everybody's too quiet
Speaker 2: about EM as far as I'm concerned, Do you have
Speaker 2: a worry about jump? Condition within EM economics is signaled
Speaker 2: through foreign exchange? Absolutely.
Speaker 8: I think it's there's two pieces of it. There's two
Speaker 8: types of EM currencies. There's a carry currency, which is
Speaker 8: Latin America and probably some pieces of Eastern Europe maybe
Speaker 8: like Hungary, which was everyone's favorite carry trade till it wasn't.
Speaker 8: The other side is the EM through growth and industrial policy,
Speaker 8: which is where Asia kicks in the remedy. Be the
Speaker 8: Taiwan dollar, Korean Korean wand tybot. Those currencies are all
Speaker 8: in those categories. The problem is, I think both of
Speaker 8: those functions EM are under dress. The Latin carry trade,
Speaker 8: besides Brazil, I think is going to be is going
Speaker 8: to massively underperform, which it has for the last six months.
Speaker 8: If you look at G ten carry versus emcerry dollar
Speaker 8: performance as a G ten carry currency is outperforming EM
Speaker 8: when you you a risk adjusted So there's two sides
Speaker 8: of this. Again, I think the trade uncertainty, the slowdown
Speaker 8: in the global economy more generally, those things are much
Speaker 8: are going to see the EM Asia currencies continue to
Speaker 8: weaken in the short term, and again the em carry
Speaker 8: trade is going to see in the Mexican peso, the
Speaker 8: Colombian paso. It'll probably see Brazil lperformed though, but those
Speaker 8: two baskets are going to underperform for at least the
Speaker 8: next three to six months. And that's kind of our
Speaker 8: view on Ian Curry.
Speaker 2: Get one more in here with He's fired up today,
Speaker 2: Mark's fired up.
Speaker 5: I saw a line in your note. I have to
Speaker 5: ask you about it, that is, this is a year
Speaker 5: to expect the unexpected, including a grand FX bargain. This
Speaker 5: is Paris accord round two at mar Lago. How do
Speaker 5: you see that playing out? How could you see that
Speaker 5: playing out?
Speaker 2: So I think it goes.
Speaker 8: Back to the original question about what's the why here.
Speaker 8: So the trade policy uncertainty, it creates a lot of
Speaker 8: tension in global markets. It sees a dollar strengthen, it
Speaker 8: sees local currencies weaken in some of these other countries,
Speaker 8: and again you start to see sentiment and economic dynamics
Speaker 8: underperform in the currencies that are being targeted. Where the trade,
Speaker 8: your trade policy and certainties on the rise, that is
Speaker 8: going to create a pressure point where I don't think
Speaker 8: everyone wants to accept a stronger local currency relative to
Speaker 8: the dollar, to just come to the table and say, yeah, sure,
Speaker 8: we'll do that. But I think with the restructuring of
Speaker 8: the global order, with the change in the structural dynamics
Speaker 8: around trade, that pulls people into the negotiating table and say, Okay, yes,
Speaker 8: our currencies are undervalued. Maybe the trade lines are not
Speaker 8: fully symmetrical, and so to get rid of this and
Speaker 8: to move into a world where things are more organized
Speaker 8: and less uncertain, what we'll do is we will agree
Speaker 8: to revalue our currencies and bring them back into line
Speaker 8: with things that are closer to fair value.
Speaker 2: And I think that's.
Speaker 8: Where all this goes, and a lot of the deal
Speaker 8: making would want to go.
Speaker 2: I gotta be quick, Chelsea, are you kidding me? Man
Speaker 2: City can't get it done? Can Chelsea hold off Man City?
Speaker 2: I think they can.
Speaker 8: They got one more Man City victory in them for
Speaker 8: this year.
Speaker 2: Okay, fired up, Mark MCCORDI thank you so much. The
Speaker 2: Toronto Dominion do really really helpful there and all on
Speaker 2: the currency dynamics and the mystery of what's going on with.
Speaker 1: Terrorist This is the Bloomberg Surveillance podcast, available on Apple, Spotify,
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