1 00:00:00,320 --> 00:00:04,160 Speaker 1: Who you put your trust in matters. Investors have put 2 00:00:04,200 --> 00:00:07,640 Speaker 1: their trust in independent registered investment advisors to the tune 3 00:00:07,640 --> 00:00:12,240 Speaker 1: of four trillion dollars. Why learn more and find your 4 00:00:12,240 --> 00:00:27,240 Speaker 1: independent advisor dot com. Welcome to the Bloomberg Surveillance Podcast. 5 00:00:27,320 --> 00:00:31,320 Speaker 1: I'm Tom Keene. Always with Michael McKee. Daily we bring 6 00:00:31,360 --> 00:00:35,280 Speaker 1: you insight from the best in economics, finance, investment, and 7 00:00:35,360 --> 00:00:41,519 Speaker 1: international relations. Find Bloomberg Surveillance on iTunes, SoundCloud, Bloomberg dot com, 8 00:00:41,560 --> 00:00:48,640 Speaker 1: and of course, on the Bloomberg I'm Tom Keene in 9 00:00:48,640 --> 00:00:51,440 Speaker 1: New York. Right now Michael McKee with an important interview. Michael, 10 00:00:51,760 --> 00:00:55,400 Speaker 1: this begins your coverage. It does indeed. The Jackson Whole 11 00:00:55,920 --> 00:00:59,920 Speaker 1: Economic Symposium kicks off tonight at Jackson Lake Lodge outside 12 00:01:00,200 --> 00:01:03,480 Speaker 1: of the town of Moran, Wyoming, about thirty miles north 13 00:01:03,880 --> 00:01:07,160 Speaker 1: of Jackson, Esther George is the president of the Kansas 14 00:01:07,160 --> 00:01:10,000 Speaker 1: City FED. She is the host of the conference. She's 15 00:01:10,040 --> 00:01:13,280 Speaker 1: also a voting member of the Open Market Committee. We 16 00:01:13,360 --> 00:01:17,479 Speaker 1: sat down yesterday and we began with monetary policy. Let's 17 00:01:17,480 --> 00:01:20,360 Speaker 1: get into monetary policy right away, because that's what everybody 18 00:01:20,360 --> 00:01:23,160 Speaker 1: wants to know about. You've dissented at every meeting since 19 00:01:23,200 --> 00:01:25,320 Speaker 1: you've been a voter because you argue the FED should 20 00:01:25,319 --> 00:01:28,200 Speaker 1: be raising interest rates. Would you still feel that way 21 00:01:28,600 --> 00:01:32,040 Speaker 1: if today we're September twenty one and you were voting. Well, 22 00:01:32,040 --> 00:01:33,800 Speaker 1: I haven't just send it at every meeting this year, 23 00:01:33,840 --> 00:01:36,520 Speaker 1: but you're right. The most recent meeting I did express 24 00:01:36,680 --> 00:01:41,040 Speaker 1: my view that I thought it was time to continue 25 00:01:41,080 --> 00:01:43,759 Speaker 1: the process of normalization of interest rates. When I look 26 00:01:43,760 --> 00:01:46,399 Speaker 1: at where we are with the job market, and when 27 00:01:46,440 --> 00:01:50,200 Speaker 1: I look at inflation and our forecast for that, um, 28 00:01:50,240 --> 00:01:53,200 Speaker 1: I think it's time to move where it will look 29 00:01:53,240 --> 00:01:55,200 Speaker 1: by the September meeting. We'll have to wait and see 30 00:01:55,240 --> 00:01:58,640 Speaker 1: if anything changes fundamentally. Well, you're looking at inflation in 31 00:01:58,680 --> 00:02:00,920 Speaker 1: the job market. Are you a firm believer in the 32 00:02:00,920 --> 00:02:03,919 Speaker 1: Phillips curve that it is going to bring us faster 33 00:02:04,000 --> 00:02:06,840 Speaker 1: inflation as unemployment goes down. So I think we're beginning 34 00:02:06,880 --> 00:02:10,040 Speaker 1: to see signs of that. I think we're seeing inflation strength, 35 00:02:10,040 --> 00:02:12,720 Speaker 1: and if you look at cp I, it's beginning to 36 00:02:12,800 --> 00:02:16,320 Speaker 1: show uh some movements. So yes, I think we should 37 00:02:17,040 --> 00:02:20,520 Speaker 1: expect that. Again, I don't think that we are going 38 00:02:20,560 --> 00:02:22,839 Speaker 1: to need to have high interest rates. I don't think 39 00:02:22,880 --> 00:02:25,359 Speaker 1: we need to cool off the economy by any means, 40 00:02:25,400 --> 00:02:28,200 Speaker 1: but I do think that it would be appropriate to 41 00:02:28,240 --> 00:02:31,960 Speaker 1: begin the process of continuing that normalization. Well, let me 42 00:02:32,000 --> 00:02:35,160 Speaker 1: follow on that word. You say normalization, what is a 43 00:02:35,240 --> 00:02:39,160 Speaker 1: normal interest rate in this post crisis environment? So there 44 00:02:39,160 --> 00:02:41,799 Speaker 1: are a lot of questions about that today what is normal? 45 00:02:41,880 --> 00:02:45,160 Speaker 1: And I think there is scope to say and you 46 00:02:45,280 --> 00:02:49,000 Speaker 1: see this in the step in the dot plot forecast 47 00:02:49,120 --> 00:02:51,960 Speaker 1: that the participants have been putting that terminal rate has 48 00:02:52,000 --> 00:02:55,520 Speaker 1: been coming down. I think, regardless of where you would 49 00:02:55,520 --> 00:02:59,720 Speaker 1: peg that today, there is scope to begin to remove 50 00:02:59,760 --> 00:03:03,480 Speaker 1: a commendation. So we're at negative real rates today, and 51 00:03:03,520 --> 00:03:06,720 Speaker 1: whether we go back to something that look normal pre 52 00:03:06,840 --> 00:03:10,560 Speaker 1: crisis or something less, I think we'll judge as we 53 00:03:10,600 --> 00:03:14,240 Speaker 1: move along. Do you think monetary policy current monetary policy 54 00:03:14,280 --> 00:03:18,079 Speaker 1: is still stimulating the economy. I do. I think that 55 00:03:18,120 --> 00:03:20,960 Speaker 1: we still have a lot of accommodation, we have a 56 00:03:21,080 --> 00:03:25,840 Speaker 1: large balance sheet, we have negative real rates, and I 57 00:03:25,880 --> 00:03:28,920 Speaker 1: think that is providing stimulus to the economy today. Now, 58 00:03:28,919 --> 00:03:31,400 Speaker 1: as far as your kids are normalizing, would be raising rates? 59 00:03:31,440 --> 00:03:35,120 Speaker 1: Would you argue in favor of beginning to stop reinvestment 60 00:03:35,560 --> 00:03:38,880 Speaker 1: or even pay down the balance sheet? So I would 61 00:03:38,880 --> 00:03:41,480 Speaker 1: be in favor of that that was not the majority 62 00:03:41,520 --> 00:03:44,880 Speaker 1: of view with the committee. But um, I thought opportunities 63 00:03:44,920 --> 00:03:48,600 Speaker 1: to begin to uh cease those reinvestments and let that 64 00:03:48,640 --> 00:03:51,600 Speaker 1: balance sheet come down naturally would be an opportunity for us, 65 00:03:51,640 --> 00:03:53,520 Speaker 1: and I hope there's a chance to talk about that 66 00:03:53,600 --> 00:03:56,560 Speaker 1: as we go forward. Now, if you start to pare 67 00:03:56,600 --> 00:03:59,400 Speaker 1: down the balance sheet, uh, there are banks that need 68 00:03:59,480 --> 00:04:03,360 Speaker 1: more nerves these days. Are you comfortable with holding a 69 00:04:03,440 --> 00:04:06,640 Speaker 1: large balance sheet, even if it's not the size that 70 00:04:06,720 --> 00:04:09,760 Speaker 1: it is today? So I'm comfortable with the principles that 71 00:04:09,840 --> 00:04:12,560 Speaker 1: the FMC has laid out, which is to return that 72 00:04:12,640 --> 00:04:17,440 Speaker 1: balance sheet to the smallest size that's necessary to conduct 73 00:04:17,440 --> 00:04:20,520 Speaker 1: monetary policy. UM I don't think that's the size it 74 00:04:20,600 --> 00:04:24,440 Speaker 1: is today. But again, that process will come later after 75 00:04:24,560 --> 00:04:29,640 Speaker 1: we've begun the short term interest rate cycle. There is 76 00:04:30,400 --> 00:04:31,840 Speaker 1: a number of there are a number of people on 77 00:04:31,920 --> 00:04:34,160 Speaker 1: Wall Street analysts who started to warn that maybe the 78 00:04:34,200 --> 00:04:37,680 Speaker 1: Fed will have to move faster than the market is anticipating. 79 00:04:38,120 --> 00:04:40,000 Speaker 1: Would you be in that camp? You say that the 80 00:04:40,040 --> 00:04:43,159 Speaker 1: Fed should begin the process, but how fast do you 81 00:04:43,200 --> 00:04:45,359 Speaker 1: think you need to move? Well, we began the process 82 00:04:45,480 --> 00:04:50,760 Speaker 1: last December, and I, like others, thought the process would 83 00:04:51,400 --> 00:04:53,880 Speaker 1: go gradually and I thought the economy would be best 84 00:04:53,880 --> 00:04:58,479 Speaker 1: served by doing that. But excessive patients I think is 85 00:04:58,520 --> 00:05:03,159 Speaker 1: not warranted. As we've seen the economy continue to unfold 86 00:05:03,200 --> 00:05:05,800 Speaker 1: the way it has with four point nine percent unemployment 87 00:05:05,880 --> 00:05:09,320 Speaker 1: rate and inflation look like it's moving back to target. 88 00:05:09,440 --> 00:05:12,000 Speaker 1: I think we should continue that process. Well, where would 89 00:05:12,040 --> 00:05:15,680 Speaker 1: your dot be in terms of two thousand seventeen or 90 00:05:15,760 --> 00:05:19,280 Speaker 1: two thousand eighteen where the Fed funds rate should be? 91 00:05:20,120 --> 00:05:22,919 Speaker 1: So my Fed funds rate has not come off markedly 92 00:05:23,040 --> 00:05:25,120 Speaker 1: from what I think is a normal rate. I judge 93 00:05:25,200 --> 00:05:28,800 Speaker 1: that every time to see whether something more fundamentally has changed. 94 00:05:28,839 --> 00:05:30,560 Speaker 1: So as we look at the rate of growth in 95 00:05:30,600 --> 00:05:34,160 Speaker 1: the economy, UM and other factors, I'm open to that. 96 00:05:34,279 --> 00:05:37,440 Speaker 1: But again, this is not an observable rate. It's hard 97 00:05:37,480 --> 00:05:40,400 Speaker 1: to know where that is. But I think under any 98 00:05:40,440 --> 00:05:43,320 Speaker 1: metric that you used today, UM, it would be time 99 00:05:43,360 --> 00:05:45,599 Speaker 1: to move. I think most of our audience has probably 100 00:05:45,640 --> 00:05:49,200 Speaker 1: heard the term our star. It's become quite the uh, 101 00:05:49,320 --> 00:05:52,720 Speaker 1: the trendy term these days. Basically the argument that the 102 00:05:52,760 --> 00:05:56,240 Speaker 1: neutral rate of interest, which neither stimulates or retards the economy, 103 00:05:56,520 --> 00:05:59,440 Speaker 1: has come way down. How much stock do you put 104 00:05:59,480 --> 00:06:02,200 Speaker 1: in that gument? And if so how much have you 105 00:06:02,279 --> 00:06:04,840 Speaker 1: moved down, if at all, because you say you've kept 106 00:06:04,880 --> 00:06:08,400 Speaker 1: yours pretty much in place. So I think it's possible 107 00:06:08,520 --> 00:06:12,200 Speaker 1: that our star is lower today. But again we don't know. 108 00:06:12,440 --> 00:06:14,760 Speaker 1: And I think even if you assume that it is 109 00:06:14,800 --> 00:06:18,799 Speaker 1: a lower number, that there is a lower terminal rate, uh, 110 00:06:18,880 --> 00:06:23,360 Speaker 1: we would be stimulatively even under that condition. So um, 111 00:06:23,400 --> 00:06:26,000 Speaker 1: I think regardless, if you believe our star is lower, 112 00:06:26,080 --> 00:06:29,920 Speaker 1: it might warrant that we should begin moving a little 113 00:06:29,960 --> 00:06:32,800 Speaker 1: more systematically than we have been. Well, one of the 114 00:06:32,800 --> 00:06:36,400 Speaker 1: reasons it's lower is obviously that productivity has come down 115 00:06:37,160 --> 00:06:39,640 Speaker 1: and so the economy is growing at a slower pace. 116 00:06:39,760 --> 00:06:42,719 Speaker 1: Do you have any theories or answers as to what's 117 00:06:42,760 --> 00:06:47,080 Speaker 1: wrong with American productivity? So I buy into a lot 118 00:06:47,080 --> 00:06:51,200 Speaker 1: of what I call partial answers to that that there 119 00:06:51,360 --> 00:06:56,760 Speaker 1: was credit tightening early uh in the recovery that we're 120 00:06:56,920 --> 00:07:00,080 Speaker 1: going to suffer from in terms of productivity, that the 121 00:07:00,120 --> 00:07:04,440 Speaker 1: economy moving from manufacturing to a more service based economy 122 00:07:04,560 --> 00:07:10,160 Speaker 1: has a different effect in terms of labor saving options there. 123 00:07:10,200 --> 00:07:13,160 Speaker 1: So I think there are any number of explanations. I 124 00:07:13,200 --> 00:07:15,800 Speaker 1: think the question is is that a permanent state, is 125 00:07:15,800 --> 00:07:20,480 Speaker 1: it just a near term persistent state. Um, I think 126 00:07:20,480 --> 00:07:23,200 Speaker 1: we'll have to just wait and see. Well, Stanley Fisher 127 00:07:23,200 --> 00:07:25,880 Speaker 1: would say he's an optimist that it's not a permanent state. 128 00:07:25,920 --> 00:07:29,200 Speaker 1: But do you have any idea what could turn this around? 129 00:07:29,920 --> 00:07:33,600 Speaker 1: Would monetary policy play a role, is it a fiscal role? 130 00:07:33,880 --> 00:07:37,000 Speaker 1: Is it animal spirits? So I think that's a great question. 131 00:07:37,040 --> 00:07:40,040 Speaker 1: And my own view is, Uh, there are other economic 132 00:07:40,120 --> 00:07:43,720 Speaker 1: policies that can influence productivity in a way that I 133 00:07:43,760 --> 00:07:47,560 Speaker 1: think monetary policy cannot. And those ought to be things 134 00:07:47,600 --> 00:07:51,400 Speaker 1: that UM, other policymakers think about and think about what 135 00:07:51,600 --> 00:07:54,720 Speaker 1: can affect the long run growth in the U S. Economy. 136 00:07:55,040 --> 00:07:58,000 Speaker 1: John Williams in his paper suggested that we have seen 137 00:07:58,920 --> 00:08:02,640 Speaker 1: sort of a secular chain in inflation, that inflation dynamics 138 00:08:02,720 --> 00:08:05,720 Speaker 1: may have changed as our star has moved down and 139 00:08:05,760 --> 00:08:09,280 Speaker 1: you star has moved down. Uh, do you see you 140 00:08:09,440 --> 00:08:12,000 Speaker 1: you're you're very much an inflation hawk. Do you see 141 00:08:12,040 --> 00:08:16,760 Speaker 1: any secular change in the inflation dynamics. So again, I 142 00:08:16,800 --> 00:08:19,080 Speaker 1: think we're going through a period where it has been 143 00:08:19,200 --> 00:08:23,240 Speaker 1: more difficult to explain what is pressing down on inflation. 144 00:08:23,880 --> 00:08:27,440 Speaker 1: I think the oil price shock that we had, the 145 00:08:27,520 --> 00:08:31,440 Speaker 1: strong dollar, a number of things has have influenced that. Again, 146 00:08:31,520 --> 00:08:34,760 Speaker 1: whether that is a permanent state, UM, I'm not ready 147 00:08:34,800 --> 00:08:36,679 Speaker 1: to say, because it looks to me like longer term 148 00:08:36,760 --> 00:08:41,000 Speaker 1: inflation expectations have been anchored, and that we are beginning 149 00:08:41,040 --> 00:08:43,920 Speaker 1: to see wage growth moving away that would reflect a 150 00:08:43,960 --> 00:08:47,320 Speaker 1: tighter labor market. So I don't know that things have 151 00:08:47,400 --> 00:08:50,199 Speaker 1: fundamentally changed at this point. Once again, your staff has 152 00:08:50,200 --> 00:08:53,000 Speaker 1: come up with sort of the perfectly timed topic for 153 00:08:53,679 --> 00:08:57,240 Speaker 1: this meeting, basically looking at what monetary policy should be 154 00:08:57,280 --> 00:09:00,440 Speaker 1: like in this new world going forward, and number of 155 00:09:00,480 --> 00:09:03,160 Speaker 1: members of the effluency have come out with papers or 156 00:09:03,640 --> 00:09:08,280 Speaker 1: theories lately about this. Uh. Do you think a fundamental change, 157 00:09:08,280 --> 00:09:13,280 Speaker 1: a fundamental rethinking how monetary policy is conducted is necessary 158 00:09:13,400 --> 00:09:16,480 Speaker 1: at this point. I'm not convinced, But that's why I'm 159 00:09:16,559 --> 00:09:19,440 Speaker 1: very interested in this conference. Uh. There'll be some good 160 00:09:19,440 --> 00:09:22,160 Speaker 1: papers coming forward, and I think one of the keys 161 00:09:22,240 --> 00:09:24,440 Speaker 1: to this conference is that you look at these issues 162 00:09:24,480 --> 00:09:26,560 Speaker 1: from both sides. So I'll be very interested in the 163 00:09:26,600 --> 00:09:30,240 Speaker 1: discussion and to what extent, if any a consensus comes 164 00:09:30,280 --> 00:09:34,160 Speaker 1: out of this meeting about whether a different framework will 165 00:09:34,200 --> 00:09:36,800 Speaker 1: be needed going forward, or whether again we can go 166 00:09:36,880 --> 00:09:39,679 Speaker 1: back to the kind of monetary policy that looked more 167 00:09:39,720 --> 00:09:42,920 Speaker 1: conventional to us. I don't want to uh to say 168 00:09:42,920 --> 00:09:45,520 Speaker 1: this the wrong way, but do you think policymakers need 169 00:09:45,559 --> 00:09:48,600 Speaker 1: to be more humble about what they can accomplish with 170 00:09:48,679 --> 00:09:53,480 Speaker 1: monetary policy? I've always thought that, and I think, uh, again, 171 00:09:53,640 --> 00:09:57,679 Speaker 1: we've gone through a terrible crisis. Uh, it did damage 172 00:09:57,679 --> 00:10:00,040 Speaker 1: to the economy, and we know that can take a 173 00:10:00,080 --> 00:10:03,760 Speaker 1: long time. So I wouldn't want to rush to assuming 174 00:10:03,800 --> 00:10:05,559 Speaker 1: that we know what the future will look like. I 175 00:10:05,559 --> 00:10:08,240 Speaker 1: think it's an appropriate time to raise some of these questions. 176 00:10:09,200 --> 00:10:11,720 Speaker 1: But yeah, I think all of us feel a heavy 177 00:10:11,720 --> 00:10:14,480 Speaker 1: dose of humility when we think about these issues. Before 178 00:10:14,480 --> 00:10:15,720 Speaker 1: I let you go, I have to ask you about 179 00:10:16,000 --> 00:10:19,760 Speaker 1: FED communications because in the minutes recently there have been 180 00:10:20,120 --> 00:10:23,200 Speaker 1: suggestions that members of the Open Market Committee have not 181 00:10:23,240 --> 00:10:26,280 Speaker 1: been happy with the way they've communicated with the markets. 182 00:10:26,280 --> 00:10:28,720 Speaker 1: Are the way the markets have interpreted things. Uh, this 183 00:10:28,800 --> 00:10:31,720 Speaker 1: is an opportunity here for a lot of members of 184 00:10:31,760 --> 00:10:34,560 Speaker 1: the Open Market Committee to to talk to the to 185 00:10:34,679 --> 00:10:38,640 Speaker 1: the markets. Uh, what are you doing wrong? If anything? 186 00:10:38,800 --> 00:10:42,040 Speaker 1: Do you have a credibility problem? Do you think? I 187 00:10:42,040 --> 00:10:44,800 Speaker 1: don't know, Mike, we have a credibility problem. I think 188 00:10:44,840 --> 00:10:48,640 Speaker 1: we all come at these issues in different ways. In 189 00:10:48,720 --> 00:10:53,360 Speaker 1: terms of a policy prescription, I think the minutes are 190 00:10:53,400 --> 00:10:56,520 Speaker 1: a good communication tool, and I think we're at a time, 191 00:10:56,600 --> 00:10:59,920 Speaker 1: as you often are, in inflection points around raising rate 192 00:11:00,040 --> 00:11:03,200 Speaker 1: where they're going to be different views around that. So UM, 193 00:11:03,240 --> 00:11:06,800 Speaker 1: I think the more we talk about how we're each 194 00:11:06,840 --> 00:11:10,120 Speaker 1: thinking about it, and I think the minutes show how 195 00:11:10,160 --> 00:11:13,600 Speaker 1: the committee forms consensus around that is probably the best 196 00:11:13,600 --> 00:11:16,640 Speaker 1: tool for communications. Well, there are concerns that the Fed 197 00:11:16,800 --> 00:11:19,720 Speaker 1: keeps suggesting we're going to raise interest rates, the markets 198 00:11:19,720 --> 00:11:22,400 Speaker 1: start to pricing a move, and then it's taken off 199 00:11:22,440 --> 00:11:25,520 Speaker 1: the table, and people are starting to say that. People 200 00:11:25,520 --> 00:11:29,160 Speaker 1: who who talk to me are starting to say, we 201 00:11:29,240 --> 00:11:30,800 Speaker 1: sort of have to write them out of the equation 202 00:11:30,840 --> 00:11:33,160 Speaker 1: unless we're absolutely guaranteed, because you know they're just going 203 00:11:33,240 --> 00:11:35,480 Speaker 1: to put it out there and pull it back again. Well, 204 00:11:36,040 --> 00:11:38,600 Speaker 1: I think what you've seen are people that are watching 205 00:11:39,200 --> 00:11:43,040 Speaker 1: the data and reacting to that. It's very important that 206 00:11:43,120 --> 00:11:47,200 Speaker 1: we be data dependent, but that doesn't mean to be 207 00:11:47,480 --> 00:11:51,560 Speaker 1: immobilized by short term views. So keeping a focus on 208 00:11:51,600 --> 00:11:54,560 Speaker 1: that medium term out look for me, UM is where 209 00:11:54,600 --> 00:11:57,079 Speaker 1: I'm trying to keep my focus thinking about what is 210 00:11:57,120 --> 00:12:00,280 Speaker 1: in the long run interest of the economy and the 211 00:12:00,280 --> 00:12:04,880 Speaker 1: ability to achieve sustained growth. Um is where my focus is. 212 00:12:05,240 --> 00:12:06,959 Speaker 1: Let me ask you last question. This is the forty 213 00:12:07,200 --> 00:12:11,199 Speaker 1: year for the Kansas City FED Symposium. Thirty eight of 214 00:12:11,280 --> 00:12:14,600 Speaker 1: those years, uh, the chair vice chair came and gave 215 00:12:14,760 --> 00:12:18,680 Speaker 1: a keynote address that went along with the theme of 216 00:12:18,679 --> 00:12:22,839 Speaker 1: the conference and wasn't particularly newsworthy. Ben Berniki came out 217 00:12:22,880 --> 00:12:27,600 Speaker 1: here twice and laid out policy and move the markets. 218 00:12:28,280 --> 00:12:31,640 Speaker 1: Janet Yellen is going to be kicking off your conference 219 00:12:32,080 --> 00:12:35,320 Speaker 1: and the markets are expecting something from her. Do you 220 00:12:35,840 --> 00:12:38,880 Speaker 1: want this to be a place where the Fed is 221 00:12:38,920 --> 00:12:44,079 Speaker 1: making policy pronouncements for the markets? The Chair decides what 222 00:12:44,400 --> 00:12:46,719 Speaker 1: she will address there, and I don't know what her 223 00:12:47,160 --> 00:12:49,720 Speaker 1: remarks are for tomorrow, so we'll all be staying tuned 224 00:12:50,160 --> 00:12:54,199 Speaker 1: to what she says. Has the conference gotten a little 225 00:12:54,240 --> 00:12:57,280 Speaker 1: too important to the markets in terms of short term 226 00:12:57,360 --> 00:13:00,720 Speaker 1: movements as opposed to what it was originally designed for. Oh? 227 00:13:00,840 --> 00:13:02,600 Speaker 1: I think this is a function of the time we're 228 00:13:02,600 --> 00:13:04,400 Speaker 1: in in the market, that there is a lot of 229 00:13:04,440 --> 00:13:08,160 Speaker 1: attention on central banks generally and certainly the Federal Reserve now, 230 00:13:08,559 --> 00:13:10,640 Speaker 1: and I look forward to a time where that is 231 00:13:10,679 --> 00:13:13,960 Speaker 1: not the key focus for markets. The purpose of our 232 00:13:14,000 --> 00:13:16,640 Speaker 1: conference here is not a policy platform. That's what the 233 00:13:16,679 --> 00:13:19,800 Speaker 1: f m C is for, and so we will continue 234 00:13:19,840 --> 00:13:22,280 Speaker 1: to keep our focus on issues that we think are 235 00:13:22,320 --> 00:13:26,120 Speaker 1: important to central banks. That's my goal for the symposium. Well, 236 00:13:26,160 --> 00:13:28,320 Speaker 1: we'll listen throughout the symposium and we'll hear from Jett 237 00:13:28,440 --> 00:13:32,160 Speaker 1: Yelling at ten o'clock Lall Street time on Friday. Mr George, 238 00:13:32,160 --> 00:13:47,120 Speaker 1: thank you very much. Thank you. So we're gonna flip 239 00:13:47,160 --> 00:13:49,920 Speaker 1: things on their head with Howard Ward. Is we're speaking 240 00:13:49,960 --> 00:13:53,120 Speaker 1: on television with Mr Ward about Apple. We're gonna continue 241 00:13:53,120 --> 00:13:55,600 Speaker 1: that discussion right now and they get to the bigger 242 00:13:55,640 --> 00:14:00,280 Speaker 1: picture here in a bit. Apple is it a low mall, 243 00:14:00,320 --> 00:14:03,400 Speaker 1: Howard Ward, Let's back up and just simply why is 244 00:14:03,440 --> 00:14:06,640 Speaker 1: there an almost nifty fifty field of the market and 245 00:14:06,720 --> 00:14:10,240 Speaker 1: Apple is not part of that family? Well, Tom, because uh, 246 00:14:10,400 --> 00:14:13,160 Speaker 1: you know, earnings have not grown very much in the 247 00:14:13,240 --> 00:14:16,680 Speaker 1: last couple of years, and you know their success has 248 00:14:16,720 --> 00:14:21,320 Speaker 1: been almost to their detriment because they've become so big. 249 00:14:21,560 --> 00:14:24,680 Speaker 1: So so we are looking forward to fiscal seventeen and 250 00:14:24,720 --> 00:14:27,680 Speaker 1: physical eighteen where we're going to see renewed growth in 251 00:14:27,720 --> 00:14:30,880 Speaker 1: Apple's earnings. Of course, they have a new phone coming 252 00:14:30,880 --> 00:14:34,640 Speaker 1: out later this year. Um, there will be a bigger, better, 253 00:14:34,880 --> 00:14:37,680 Speaker 1: more bells and Whistle's phone a year from now because 254 00:14:37,720 --> 00:14:40,880 Speaker 1: they're gonna be celebrating the tenth anniversary iPhone. So Tim 255 00:14:40,920 --> 00:14:43,600 Speaker 1: Cooke has his fifth anniversary. Now iPhone is gonna have 256 00:14:43,640 --> 00:14:46,040 Speaker 1: a ten year anniversary next year. They're gonna make a 257 00:14:46,040 --> 00:14:48,480 Speaker 1: big deal out of that. And so, uh, you know, 258 00:14:48,760 --> 00:14:52,160 Speaker 1: we are looking forward to uh, you know, upgrades to 259 00:14:52,240 --> 00:14:55,000 Speaker 1: the new phone later this year and then again next year. 260 00:14:55,200 --> 00:14:56,520 Speaker 1: But next year is going to get to give you 261 00:14:56,560 --> 00:14:59,840 Speaker 1: the bigger pop. Revenues are flat, earnings are flat wherever 262 00:14:59,880 --> 00:15:01,760 Speaker 1: you are in the income state. And maybe those are 263 00:15:01,800 --> 00:15:06,560 Speaker 1: flow analysis, but that way, that stock of free cash 264 00:15:06,600 --> 00:15:11,720 Speaker 1: flow is still extraordinary. Why doesn't the market value that? Well? 265 00:15:11,760 --> 00:15:15,560 Speaker 1: The market uh, I think over I think over time 266 00:15:15,600 --> 00:15:18,840 Speaker 1: at well, companies generating around fifty billion dollars a year 267 00:15:18,840 --> 00:15:21,800 Speaker 1: and and free cash flow, which is very significant. They 268 00:15:21,840 --> 00:15:24,080 Speaker 1: have a couple hundred billion dollars of cash on the 269 00:15:24,080 --> 00:15:27,320 Speaker 1: balance sheet. Now a lot of that cash is overseas. 270 00:15:27,360 --> 00:15:30,880 Speaker 1: I think that we'd like to see corporate tax reform 271 00:15:30,960 --> 00:15:34,080 Speaker 1: to allow them to repatriate that capital without subjecting it 272 00:15:34,120 --> 00:15:36,760 Speaker 1: to a thirty five percent tax. I think Apple would 273 00:15:36,800 --> 00:15:39,400 Speaker 1: like to probably use that cash, or a big chunk 274 00:15:39,440 --> 00:15:43,440 Speaker 1: of it anyway for a an acquisition, and that acquisition, 275 00:15:43,480 --> 00:15:45,920 Speaker 1: whatever it is, whenever it comes, if it comes, could 276 00:15:45,960 --> 00:15:49,560 Speaker 1: be important and determining the multiple of earnings that people 277 00:15:49,560 --> 00:15:51,440 Speaker 1: pay for Apple stock, because it's hard for me to 278 00:15:51,480 --> 00:15:54,040 Speaker 1: see Apple buying anything that could result in a lower 279 00:15:54,080 --> 00:15:56,760 Speaker 1: multiple than they currently have. Tom we have some really 280 00:15:56,800 --> 00:16:00,800 Speaker 1: interesting headlines crossing the Bloomberg Professional right now my Land, 281 00:16:01,040 --> 00:16:04,280 Speaker 1: and it's EpiPen cost that has caused so much controversy 282 00:16:04,320 --> 00:16:06,560 Speaker 1: in the political world over the last twenty four hours. 283 00:16:06,560 --> 00:16:11,040 Speaker 1: They are announcing immediate plans to cut the cost of 284 00:16:11,200 --> 00:16:13,960 Speaker 1: the EpiPen. They'll cover up to three dollars of the 285 00:16:13,960 --> 00:16:16,480 Speaker 1: out of pocket cost by selling the auto injector this 286 00:16:16,640 --> 00:16:21,280 Speaker 1: is epinephron UH two directly to patients, and they're going 287 00:16:21,320 --> 00:16:26,760 Speaker 1: to double eligibility for a patient assistance program. The increasing 288 00:16:26,840 --> 00:16:32,800 Speaker 1: prices and the politicians are decrying has gotten action absolutely extraordinary. 289 00:16:32,920 --> 00:16:36,240 Speaker 1: I don't believe, Michael McKee, I've ever really seen the 290 00:16:36,320 --> 00:16:39,760 Speaker 1: drama of that. And it's wonderful to have Howard Ward 291 00:16:39,800 --> 00:16:42,560 Speaker 1: with us. Howard, you and I were weened on a 292 00:16:42,600 --> 00:16:46,360 Speaker 1: big pharma that was literally like the Big three in Detroit. 293 00:16:47,000 --> 00:16:50,760 Speaker 1: Boy has the game change for our pharmaceuticals and drugs? 294 00:16:51,200 --> 00:16:54,120 Speaker 1: What is your opportunity there when you see this kind 295 00:16:54,120 --> 00:16:57,960 Speaker 1: of historic headline. Well, first of all, I have to 296 00:16:58,280 --> 00:17:01,320 Speaker 1: I will congratulate Milon for taking the action that they're taking. 297 00:17:01,360 --> 00:17:03,600 Speaker 1: I don't know if they're cutting the price enough considering 298 00:17:03,640 --> 00:17:09,160 Speaker 1: that they're raised it, uh, which I think is outrageous. 299 00:17:09,200 --> 00:17:12,000 Speaker 1: There's just your f very healthcare healthcare company needs to 300 00:17:12,000 --> 00:17:15,280 Speaker 1: be about more than simply the bottom line, and yet's 301 00:17:15,640 --> 00:17:18,520 Speaker 1: price gouging to the tenth degree. Howard Ward is murk 302 00:17:18,800 --> 00:17:21,920 Speaker 1: today anything like the murk of yours? In my ute? 303 00:17:22,600 --> 00:17:29,639 Speaker 1: Uh Merk remains a terrific uh scientific based research pharmaceutical company, 304 00:17:29,680 --> 00:17:33,320 Speaker 1: but growth in pharmaceuticals is not what it used to be. 305 00:17:33,520 --> 00:17:35,920 Speaker 1: They have some obviously, they're doing very well with their 306 00:17:36,000 --> 00:17:40,280 Speaker 1: new immunotherapy drug, which has recently gotten a little bit 307 00:17:40,320 --> 00:17:44,520 Speaker 1: of better publicity due to Bristol's misstep in their clinical 308 00:17:44,520 --> 00:17:47,520 Speaker 1: three trial for their up DEVO competing drug. I actually 309 00:17:47,560 --> 00:17:49,800 Speaker 1: would prefer Bristol here. I think Bristol really is the 310 00:17:49,880 --> 00:17:54,280 Speaker 1: leader in immunotherapy. I think Bristol is a better play 311 00:17:54,359 --> 00:17:58,400 Speaker 1: on and I cancer drugs. The stocks down over all 312 00:17:58,480 --> 00:18:02,840 Speaker 1: because of the old trial uh and up DEVO for 313 00:18:03,080 --> 00:18:07,080 Speaker 1: lung cancer. Uh. That trial was a broader trial. They 314 00:18:07,080 --> 00:18:09,479 Speaker 1: went for a broader label than MRK went for with 315 00:18:09,520 --> 00:18:12,960 Speaker 1: their approval, and and that was probably their undoing. But 316 00:18:13,040 --> 00:18:15,320 Speaker 1: this is gonna continue to be So this is gonna 317 00:18:15,320 --> 00:18:17,359 Speaker 1: be maybe an eight billion dollar drug instead of a 318 00:18:17,600 --> 00:18:21,000 Speaker 1: instead of a twelve billion dollar drugs. It's a terrific product. 319 00:18:21,680 --> 00:18:24,119 Speaker 1: Bristol is the one I would go with dividend in 320 00:18:24,200 --> 00:18:27,399 Speaker 1: excess of two and and and strong double digit growth 321 00:18:27,440 --> 00:18:30,960 Speaker 1: over the next several years. Would you go with it? Uh? 322 00:18:31,200 --> 00:18:34,320 Speaker 1: Outside of just looking at a winner in the farmer's space. 323 00:18:34,400 --> 00:18:36,880 Speaker 1: And I asked that because we keep hearing about how 324 00:18:36,920 --> 00:18:40,560 Speaker 1: hard it is for pharmaceutical companies to develop drugs anymore 325 00:18:40,840 --> 00:18:44,280 Speaker 1: that have a significantly long shelf life and a very 326 00:18:44,359 --> 00:18:47,040 Speaker 1: high expected rate of return as they used to do. 327 00:18:47,600 --> 00:18:51,240 Speaker 1: And so is farm is still a key area to 328 00:18:51,280 --> 00:18:54,400 Speaker 1: get into? Well, you know, the multiples have come down 329 00:18:54,440 --> 00:18:58,240 Speaker 1: on a lot of most of the these companies, uh, 330 00:18:58,400 --> 00:19:03,520 Speaker 1: compared to the the nineteen eighties, let's say, in early nineties, Uh, 331 00:19:03,920 --> 00:19:06,040 Speaker 1: you know, which was really a terrific time for for 332 00:19:06,119 --> 00:19:10,159 Speaker 1: big pharma. Uh so yeah, I mean in a huge 333 00:19:10,280 --> 00:19:14,400 Speaker 1: new drug discovery is very difficult. The the the low 334 00:19:14,440 --> 00:19:19,040 Speaker 1: hanging fruit has been picked, and uh, you're getting you know, 335 00:19:19,160 --> 00:19:22,800 Speaker 1: much more price competition, believe it or not, uh than 336 00:19:22,840 --> 00:19:26,520 Speaker 1: we had in the past, because of alternative use, alternative drugs, 337 00:19:26,520 --> 00:19:29,920 Speaker 1: competing drugs, because of generic drugs, and because of the 338 00:19:29,960 --> 00:19:33,159 Speaker 1: kind of pushback that uh that the media can now 339 00:19:33,240 --> 00:19:36,800 Speaker 1: provide when it finds situations like it discovered with the 340 00:19:36,840 --> 00:19:41,000 Speaker 1: EpiPen which were simply outrageous. What do you do, Howard Ward? 341 00:19:41,400 --> 00:19:44,600 Speaker 1: With the success that you have. You're in a blue 342 00:19:44,680 --> 00:19:47,640 Speaker 1: chip stock and up up it goes, and it's trading 343 00:19:47,640 --> 00:19:51,159 Speaker 1: in a big, fat twenty plus multiple. Do you hold 344 00:19:51,160 --> 00:19:54,760 Speaker 1: those shares? Do you use the proverbial phrase lighten up? 345 00:19:54,880 --> 00:19:57,000 Speaker 1: Because I know you don't sell the whole position out? 346 00:19:57,400 --> 00:20:00,639 Speaker 1: What do you do well? Tom? I think that in 347 00:20:01,240 --> 00:20:03,520 Speaker 1: the situation like Bristol Myers and I can throw Allergan 348 00:20:03,560 --> 00:20:06,080 Speaker 1: into the same category because aler in gonstock is also 349 00:20:06,119 --> 00:20:09,760 Speaker 1: down over and represents real value within the farmers sector. 350 00:20:09,800 --> 00:20:12,640 Speaker 1: It's a different take on the business than Bristol because 351 00:20:12,640 --> 00:20:14,680 Speaker 1: a lot of its aesthetics and they have a big 352 00:20:14,720 --> 00:20:18,240 Speaker 1: I oriented business. Uh, but the stock is is very 353 00:20:18,240 --> 00:20:22,359 Speaker 1: good value here, uh, strong balance sheet, five billion dollars 354 00:20:22,359 --> 00:20:24,359 Speaker 1: of buybacks between now and your in or in the making, 355 00:20:24,359 --> 00:20:26,440 Speaker 1: twenty seven billion dollars of cash in the balance sheet. 356 00:20:26,720 --> 00:20:30,800 Speaker 1: So there is value in the farm names. The multiples 357 00:20:30,840 --> 00:20:33,879 Speaker 1: have come down. I think that you you have to 358 00:20:34,520 --> 00:20:40,280 Speaker 1: try to put blinders on and ignore the very h 359 00:20:40,680 --> 00:20:44,360 Speaker 1: sharp volatility in these stocks on every data point. Uh, 360 00:20:44,720 --> 00:20:46,840 Speaker 1: it's a little bit overdone, it's a little bit silly. 361 00:20:46,880 --> 00:20:50,520 Speaker 1: It's momentum driven, it's e t F driven. So so 362 00:20:50,560 --> 00:20:52,240 Speaker 1: I think you have to look at the numbers, redo 363 00:20:52,320 --> 00:20:54,480 Speaker 1: your numbers, rebas and almost what do you have to 364 00:20:54,520 --> 00:20:56,119 Speaker 1: do if the numbers still makes sense, You have to 365 00:20:56,160 --> 00:21:00,800 Speaker 1: stay with these stocks away from your ruld. Is there 366 00:21:00,840 --> 00:21:02,879 Speaker 1: a bond bubble, because I know you're gonna tell me 367 00:21:02,920 --> 00:21:06,080 Speaker 1: Howard Ward, there's not an equity bubble, but price up, 368 00:21:06,200 --> 00:21:09,520 Speaker 1: yield down, negative yields, and all the distortion. Is that 369 00:21:09,560 --> 00:21:11,640 Speaker 1: what you're working with in equities is on the other 370 00:21:11,720 --> 00:21:15,639 Speaker 1: side of the aisle. Well, we've got a bubble. The 371 00:21:16,080 --> 00:21:19,080 Speaker 1: tenure treasury is selling at sixty five times. It's coupon. 372 00:21:19,160 --> 00:21:21,320 Speaker 1: We talk about price earnings ratios, on stocks. Le's talk 373 00:21:21,320 --> 00:21:24,480 Speaker 1: about price coupon upon sixty five times the coupon. The 374 00:21:24,520 --> 00:21:28,000 Speaker 1: coupon isn't growing, the principle isn't growing. And they the 375 00:21:28,080 --> 00:21:31,639 Speaker 1: coupon is two percent or less. Why would you buy that? 376 00:21:31,760 --> 00:21:34,359 Speaker 1: The stocks give you a two percent diffiden, the dividend grows, 377 00:21:34,359 --> 00:21:37,960 Speaker 1: the earnings grow. Money's got it. Let's come back, Howard Ward. 378 00:21:38,400 --> 00:21:42,080 Speaker 1: It's great that we have a disparity of presidents and 379 00:21:42,200 --> 00:21:45,199 Speaker 1: governors as well. Do you give a tilt to the 380 00:21:45,280 --> 00:21:48,440 Speaker 1: monetary theorist of the Fed or do you like feed 381 00:21:48,480 --> 00:21:53,520 Speaker 1: on the ground realists like Esther George. Oh, Tom, I'm 382 00:21:53,520 --> 00:21:58,119 Speaker 1: a practical guy. I'm probably a little probably just split 383 00:21:58,160 --> 00:22:00,639 Speaker 1: it right down the middle there. I think the theory 384 00:22:00,720 --> 00:22:05,880 Speaker 1: is great, but you've got to be willing to uh 385 00:22:06,080 --> 00:22:09,879 Speaker 1: look at at the real picture and see, uh, you know, 386 00:22:09,960 --> 00:22:13,960 Speaker 1: how monetary policy works over time, and it doesn't always work, 387 00:22:14,080 --> 00:22:15,520 Speaker 1: and we're seeing a little bit of that right now. 388 00:22:15,560 --> 00:22:18,000 Speaker 1: I think, Well, the big question out here is what 389 00:22:18,080 --> 00:22:21,880 Speaker 1: does Janet Yelling say. There's a fascinating and this is Tom. 390 00:22:21,920 --> 00:22:26,000 Speaker 1: I found this absolutely fascinating, fascinating statistic out from Bloomberg 391 00:22:26,040 --> 00:22:31,600 Speaker 1: Intelligence Chief economist Michael McDonough. Uh, it's so far here. Today, 392 00:22:31,760 --> 00:22:35,920 Speaker 1: Janet Yellen has delivered only two official speeches since n 393 00:22:36,440 --> 00:22:39,440 Speaker 1: to FED chair has averaged nineteen official speeches a year. 394 00:22:40,440 --> 00:22:42,840 Speaker 1: Is it harder, Howard, to discern what's going on when 395 00:22:42,880 --> 00:22:45,359 Speaker 1: you don't hear from the horse at the center of 396 00:22:45,400 --> 00:22:47,639 Speaker 1: it all. Yes, so, Mike, I'm a bit of a 397 00:22:47,640 --> 00:22:50,119 Speaker 1: dinosaur on this topic. I am not in favor of 398 00:22:50,160 --> 00:22:53,280 Speaker 1: FED transparency. I would prefer a FED that did not 399 00:22:53,359 --> 00:22:56,760 Speaker 1: have press conferences and did not immediately tell the world 400 00:22:57,160 --> 00:22:59,399 Speaker 1: what his decisions were. I'd like to go back to 401 00:22:59,440 --> 00:23:01,919 Speaker 1: the world where our investors were kept on edge and 402 00:23:01,960 --> 00:23:04,840 Speaker 1: they had to try to read the tea leaves UH 403 00:23:04,960 --> 00:23:09,960 Speaker 1: by watching FED funds and and UH money supply rates 404 00:23:09,960 --> 00:23:11,960 Speaker 1: of growth in order to determine what the FED was doing. 405 00:23:13,080 --> 00:23:17,800 Speaker 1: I think that the current situation lends itself to actually 406 00:23:18,000 --> 00:23:20,639 Speaker 1: market violatility, because it pushes everybody on one side of 407 00:23:20,680 --> 00:23:22,919 Speaker 1: the boat if they know exactly what the Fed's going 408 00:23:22,960 --> 00:23:25,680 Speaker 1: to do. And that was I think a necessary thing 409 00:23:25,680 --> 00:23:28,320 Speaker 1: to do, perhaps in the aftermath of OH eight, when 410 00:23:28,320 --> 00:23:30,679 Speaker 1: the FED really wanted to make it so clear that 411 00:23:30,720 --> 00:23:32,920 Speaker 1: they were going to tighten for for a long long time, 412 00:23:33,320 --> 00:23:35,840 Speaker 1: but it starts to work perhaps against you if when 413 00:23:35,880 --> 00:23:37,919 Speaker 1: you get into a period where maybe rates need to 414 00:23:37,920 --> 00:23:41,160 Speaker 1: go up and and you're constantly talking about the need 415 00:23:41,200 --> 00:23:42,800 Speaker 1: to raise rates, and now you can't do it. I 416 00:23:42,880 --> 00:23:44,480 Speaker 1: just wish the FED would get out of it. I 417 00:23:44,480 --> 00:23:46,760 Speaker 1: don't like the idea of all the FED governers. So 418 00:23:46,760 --> 00:23:49,399 Speaker 1: many FED governors constantly in the press were expressing their 419 00:23:49,400 --> 00:23:52,120 Speaker 1: own points of view. Well, do you think the FED 420 00:23:52,200 --> 00:23:54,639 Speaker 1: has lost some credibility? It used to be able to 421 00:23:54,760 --> 00:23:56,560 Speaker 1: job on the markets the way it wanted to go 422 00:23:57,400 --> 00:24:00,959 Speaker 1: without actually raising or lowering rates. Have they lost that credibility? 423 00:24:01,160 --> 00:24:03,120 Speaker 1: I think they've lost some credibility. And I think you're 424 00:24:03,119 --> 00:24:06,560 Speaker 1: gonna hear Janet Yellen tomorrow UH sort of make it 425 00:24:06,680 --> 00:24:10,280 Speaker 1: very clear that the FED is very close to raising rates. 426 00:24:10,320 --> 00:24:15,719 Speaker 1: I think she's going to want to provide the the 427 00:24:16,160 --> 00:24:19,440 Speaker 1: a talk that makes you wonder maybe she will raise 428 00:24:19,600 --> 00:24:22,520 Speaker 1: rates in September. But I don't really see the case 429 00:24:22,600 --> 00:24:24,560 Speaker 1: for that right now. I know she's trained as a 430 00:24:24,600 --> 00:24:28,840 Speaker 1: labor economist. We've had a few strong months of payroll growth, 431 00:24:29,119 --> 00:24:31,320 Speaker 1: but beyond that, I don't see the case for raising 432 00:24:31,400 --> 00:24:34,199 Speaker 1: rates right now. What I find absolutely bizarre about this 433 00:24:34,280 --> 00:24:37,760 Speaker 1: Howard Ward, is it or zero point five zero? Mike, 434 00:24:37,760 --> 00:24:39,920 Speaker 1: what are you gonna go to zero point seven five 435 00:24:40,080 --> 00:24:43,200 Speaker 1: one point zero zero? Well, if they go twenty five 436 00:24:43,240 --> 00:24:45,159 Speaker 1: basis points, it would be arranged. They would raise it 437 00:24:45,160 --> 00:24:52,320 Speaker 1: to a range between fifty may have oh five three, Howard. 438 00:24:52,359 --> 00:24:55,919 Speaker 1: We are so far from normal, aren't we. Tom. I 439 00:24:55,960 --> 00:24:58,560 Speaker 1: don't know how long it's going to take to get 440 00:24:58,560 --> 00:25:03,000 Speaker 1: back to three. Uh. We may both be retired by then. Well, 441 00:25:03,000 --> 00:25:07,920 Speaker 1: I'm not going to be retired enjoying the tuition flow, Mike. 442 00:25:08,119 --> 00:25:11,720 Speaker 1: Ten years ago and you were catching sturgeon in Yellowstone 443 00:25:11,760 --> 00:25:16,320 Speaker 1: Park five point to five ten years ago. Yeah, we 444 00:25:16,480 --> 00:25:19,400 Speaker 1: just shows how how much things have changed because are 445 00:25:19,440 --> 00:25:22,880 Speaker 1: no in in in the park. But that's okay. Well 446 00:25:22,880 --> 00:25:25,000 Speaker 1: I just brought that up because the world, Howard Ward 447 00:25:25,080 --> 00:25:28,560 Speaker 1: was a dinosaurs, so I thought. But the average yield 448 00:25:28,560 --> 00:25:30,680 Speaker 1: on the tenure treasury for the last thirty five years 449 00:25:30,720 --> 00:25:34,920 Speaker 1: is about six percent, which of course was pretty good 450 00:25:34,920 --> 00:25:38,119 Speaker 1: competition for stocks in any normal world. But that's not 451 00:25:38,240 --> 00:25:40,439 Speaker 1: one and a half percent, and Lord only knows when 452 00:25:40,480 --> 00:25:42,520 Speaker 1: we're gonna ever get back to six percent. Howard, Thank 453 00:25:42,560 --> 00:25:45,399 Speaker 1: you so much. Just exceptionally valuable this morning, particularly that 454 00:25:45,480 --> 00:25:49,080 Speaker 1: analysis of pe of bonds compared to peas of the 455 00:25:49,119 --> 00:25:55,320 Speaker 1: equity markets. Mr Ward was a gam coke who you 456 00:25:55,359 --> 00:25:59,240 Speaker 1: put your trust in matters. Investors have put their trust 457 00:25:59,320 --> 00:26:02,640 Speaker 1: in independent registered investment advisors to the tune of four 458 00:26:02,760 --> 00:26:07,240 Speaker 1: trillion dollars. Why they see their role is to serve, 459 00:26:07,720 --> 00:26:10,960 Speaker 1: not sell. That's why Charles Schwab is committed to the 460 00:26:11,000 --> 00:26:15,680 Speaker 1: success of over seven thousand independent financial advisors who passionately 461 00:26:15,720 --> 00:26:20,120 Speaker 1: dedicate themselves to helping people achieve their financial goals. Learn 462 00:26:20,160 --> 00:26:28,720 Speaker 1: more and find your independent advisor dot com. We now 463 00:26:28,760 --> 00:26:30,879 Speaker 1: need to have a moment of silence for Dr Schiller 464 00:26:30,960 --> 00:26:33,920 Speaker 1: up at Brown University, of course running the shop there 465 00:26:33,960 --> 00:26:39,480 Speaker 1: on their esteem Political uh Science study Introduction to the 466 00:26:39,480 --> 00:26:44,679 Speaker 1: American Political Process? When doy is that a comedy course? Brown? 467 00:26:44,760 --> 00:26:48,160 Speaker 1: This year? How do you rewrite the curricula for the 468 00:26:48,359 --> 00:26:51,639 Speaker 1: Dowey Hype freshman crew. It is going to be a 469 00:26:51,760 --> 00:26:53,920 Speaker 1: big challenge this year. I'm telling you I've been working 470 00:26:53,960 --> 00:26:56,600 Speaker 1: on it for last couple of weeks, trying to revamp it, 471 00:26:56,640 --> 00:26:59,880 Speaker 1: trying to keep everybody calm, trying to instill some faith 472 00:27:00,119 --> 00:27:03,400 Speaker 1: in the Constitution. Uh. We start with the Constitution, which 473 00:27:03,440 --> 00:27:05,240 Speaker 1: I think is always a great place to start. Yes, 474 00:27:05,840 --> 00:27:07,960 Speaker 1: I'll go with that. Two weeks ago, Wendy, I was 475 00:27:08,000 --> 00:27:11,680 Speaker 1: in scenic Williamstown, Massachusetts. There's a small college up there 476 00:27:12,119 --> 00:27:15,240 Speaker 1: you may have heard of, and I attended the graveyard 477 00:27:15,320 --> 00:27:18,560 Speaker 1: of Williams going back to colonial time, and there was 478 00:27:18,600 --> 00:27:20,960 Speaker 1: the new grave of James McGregor Burns, who's one of 479 00:27:21,000 --> 00:27:26,399 Speaker 1: yours and my heroes. Uh, Professor Burns, Jim Burns passing 480 00:27:26,440 --> 00:27:30,480 Speaker 1: away two years ago after an extraordinary contribution to our 481 00:27:30,480 --> 00:27:34,920 Speaker 1: political science and history. I would suggest Professor Burns of 482 00:27:35,000 --> 00:27:40,119 Speaker 1: Williams College wouldn't recognize this presidential race. What would you 483 00:27:40,200 --> 00:27:43,840 Speaker 1: say to Jim Burns? Well, you know what's doestening to 484 00:27:43,880 --> 00:27:46,840 Speaker 1: me is that on the Republican side, this race has 485 00:27:46,880 --> 00:27:50,600 Speaker 1: been completely non traditional. Uh. It's really upended the party. 486 00:27:50,840 --> 00:27:54,800 Speaker 1: On the Democratic side, it doesn't look that new, it doesn't, 487 00:27:54,840 --> 00:27:56,640 Speaker 1: you know. I mean Hillary Clinton was a front runner. 488 00:27:56,680 --> 00:28:00,200 Speaker 1: Hillary Clinton defeated a strong challenger. The Democrats tradition only 489 00:28:00,240 --> 00:28:02,720 Speaker 1: have a lot of people running for president, so this 490 00:28:02,800 --> 00:28:05,520 Speaker 1: is unusual for the Democrats. But things worked out as 491 00:28:05,560 --> 00:28:08,679 Speaker 1: they planned them to work out. But for Republicans, I 492 00:28:08,680 --> 00:28:12,000 Speaker 1: think it's the dialogue. I think what mcgrega Burns and 493 00:28:12,040 --> 00:28:15,960 Speaker 1: a lot of political scientists, particularly going back even further V. O. T. E. 494 00:28:16,080 --> 00:28:19,119 Speaker 1: Sha Schneider, who are sort of formed under you know, 495 00:28:19,200 --> 00:28:23,000 Speaker 1: communism and fascism, they would worry a great deal about 496 00:28:23,040 --> 00:28:26,200 Speaker 1: campaigns that are running plots one that seems to divide, 497 00:28:26,680 --> 00:28:29,800 Speaker 1: because that's the big sort of challenge for the United 498 00:28:29,880 --> 00:28:33,520 Speaker 1: States of America not to get divided over these kinds 499 00:28:33,520 --> 00:28:36,679 Speaker 1: of differences which make our country sort of unique on 500 00:28:36,680 --> 00:28:40,840 Speaker 1: the planet. Jacob Wiiner middle of the twentieth century, the 501 00:28:41,160 --> 00:28:44,920 Speaker 1: iconic paper on mercantilism everybody at gunpoint is forced to 502 00:28:44,960 --> 00:28:48,400 Speaker 1: read it is Donald Trump running on nothing more than 503 00:28:48,480 --> 00:28:53,880 Speaker 1: economic mercantilism within the political space, I think he's running 504 00:28:54,000 --> 00:28:59,760 Speaker 1: on really old fashioned demagoguic populism um and I think 505 00:29:00,880 --> 00:29:04,040 Speaker 1: is much more like a nineteenth century Robert Baron or 506 00:29:04,160 --> 00:29:07,760 Speaker 1: nineteenth century you know, very wealthy person who has the 507 00:29:07,800 --> 00:29:11,320 Speaker 1: money in the time and thanks politicians don't do their job, 508 00:29:11,800 --> 00:29:14,200 Speaker 1: and you know, decided how much can I up end 509 00:29:14,240 --> 00:29:17,400 Speaker 1: this system just by running? And in some ways, I 510 00:29:17,480 --> 00:29:19,680 Speaker 1: hope nobody gets really angry with me about this, but 511 00:29:19,960 --> 00:29:22,080 Speaker 1: I think that he's doing us a favor in the 512 00:29:22,120 --> 00:29:24,800 Speaker 1: sense that he's exposing a lot of flaws in our 513 00:29:24,800 --> 00:29:27,920 Speaker 1: nomination system in sort of the rhetoric that Republicans have 514 00:29:27,960 --> 00:29:31,920 Speaker 1: been using for a long time about government and about minorities. Um, 515 00:29:32,000 --> 00:29:34,400 Speaker 1: challenging the Democrats to come up with something better than 516 00:29:34,400 --> 00:29:36,760 Speaker 1: they've had for the last forty years. There's a lot 517 00:29:36,760 --> 00:29:39,560 Speaker 1: of ways in which, had he run a different campaign, 518 00:29:40,000 --> 00:29:43,120 Speaker 1: he could have really pushed the system forward. Um. I'm 519 00:29:43,160 --> 00:29:45,320 Speaker 1: not sure it's too weak for that. But he's running 520 00:29:45,320 --> 00:29:47,480 Speaker 1: out of time. Yeah, and then the paper again, I 521 00:29:47,560 --> 00:29:52,280 Speaker 1: forgot decided folks, power versus plenty winer of is a 522 00:29:52,320 --> 00:29:55,280 Speaker 1: classic help me or there's like eight ways to go here, Wendy. 523 00:29:55,320 --> 00:29:57,920 Speaker 1: But in the time that we have with you, uh, 524 00:29:58,040 --> 00:30:01,560 Speaker 1: in this our professor shoulder, help me with where the 525 00:30:01,640 --> 00:30:06,840 Speaker 1: Republican Party goes the first Wednesday of November. I'm fascinated by, like, 526 00:30:07,200 --> 00:30:09,600 Speaker 1: what does the Bush family do? Or what does this? 527 00:30:09,840 --> 00:30:13,479 Speaker 1: What does the Senate Majority leader do? Well? I think, um, 528 00:30:13,520 --> 00:30:15,080 Speaker 1: a couple of things happen. I mean, I think the 529 00:30:15,120 --> 00:30:17,440 Speaker 1: biggest question mark is the House of Representatives for the 530 00:30:17,440 --> 00:30:20,600 Speaker 1: Republican Party, because that really has been the site of 531 00:30:20,600 --> 00:30:24,160 Speaker 1: a most turmoil and the greatest dysfunction within the Republican Party, 532 00:30:24,360 --> 00:30:27,080 Speaker 1: and the question is do they lose seats and how 533 00:30:27,120 --> 00:30:30,600 Speaker 1: many seats do they lose. I don't think today, looking forward, 534 00:30:30,640 --> 00:30:32,440 Speaker 1: they're going to lose control of the House, but if 535 00:30:32,480 --> 00:30:35,200 Speaker 1: they lose a lot of seats, those seats are likely 536 00:30:35,240 --> 00:30:37,520 Speaker 1: to be moderate to competitive. There aren't that many of 537 00:30:37,560 --> 00:30:40,160 Speaker 1: them left, and the people who'll be left are be very, 538 00:30:40,320 --> 00:30:43,600 Speaker 1: very conservative Republicans. So the problem for the Republican Party 539 00:30:43,640 --> 00:30:47,080 Speaker 1: moving forward is that their their composition in the House 540 00:30:47,120 --> 00:30:50,200 Speaker 1: in particular and even the Senate will be more conservative, 541 00:30:50,480 --> 00:30:53,040 Speaker 1: not less after November if things go the way that 542 00:30:53,120 --> 00:30:55,760 Speaker 1: we think they will, which makes it even harder to 543 00:30:55,920 --> 00:30:59,200 Speaker 1: move that party forward. You cannot win the White House 544 00:30:59,560 --> 00:31:02,680 Speaker 1: on the fore that they currently embrace. I think that's 545 00:31:02,680 --> 00:31:05,680 Speaker 1: pretty clear. And so if that becomes if that becomes 546 00:31:05,680 --> 00:31:09,480 Speaker 1: the fact um Wednesday, afterwards, Paul Ryan has to figure 547 00:31:09,520 --> 00:31:11,720 Speaker 1: out a way to a recruit new kinds of people 548 00:31:11,760 --> 00:31:13,760 Speaker 1: to run for the Republican Party, which is what new 549 00:31:13,800 --> 00:31:16,920 Speaker 1: Gingridge did in ninety four, which was very successful, and 550 00:31:17,120 --> 00:31:19,720 Speaker 1: figure out a way to update this party. What can 551 00:31:19,800 --> 00:31:23,600 Speaker 1: help him are Republican governors. Republican governors are some of 552 00:31:23,600 --> 00:31:25,840 Speaker 1: them are very conservative, but they are by sort of 553 00:31:26,400 --> 00:31:29,080 Speaker 1: fact of life, much more moderate in the way that 554 00:31:29,120 --> 00:31:32,200 Speaker 1: they have to deal with running their states than members 555 00:31:32,200 --> 00:31:35,600 Speaker 1: of Congress. And I see the moderation actually coming from 556 00:31:35,640 --> 00:31:39,520 Speaker 1: the Republican governors rather than inside the House representatives. After 557 00:31:39,720 --> 00:31:43,320 Speaker 1: the November eight within this is the arch question of 558 00:31:43,400 --> 00:31:45,680 Speaker 1: all Democrats and Republicans. I want to get to the 559 00:31:45,680 --> 00:31:48,680 Speaker 1: flip flop on immigration here at a moment, I say 560 00:31:48,760 --> 00:31:52,000 Speaker 1: that without political dispersion to Mr Trump, But that's the 561 00:31:52,040 --> 00:31:55,720 Speaker 1: topic jure. But Professor Schiller, if I look at this, 562 00:31:56,120 --> 00:32:00,080 Speaker 1: everybody wants to know what does Speaker Ryan do? Is 563 00:32:00,120 --> 00:32:03,720 Speaker 1: he waiting for a moment or does he just shut 564 00:32:03,840 --> 00:32:07,080 Speaker 1: his lip until we get to November? He stays quiet? 565 00:32:07,240 --> 00:32:09,040 Speaker 1: I mean, you know, this is the guy who's young, 566 00:32:09,240 --> 00:32:12,880 Speaker 1: who's looking towards the future, absolutely right, So he's got 567 00:32:12,880 --> 00:32:15,040 Speaker 1: to stay quiet because in the end of the day, 568 00:32:15,360 --> 00:32:19,720 Speaker 1: unlike the Democratic Party party, loyalty used to be sort 569 00:32:19,720 --> 00:32:21,719 Speaker 1: of a code of honor for the Republican Party. And 570 00:32:21,760 --> 00:32:24,800 Speaker 1: I still think among a lot of people, particularly donors, 571 00:32:24,840 --> 00:32:28,360 Speaker 1: particularly long time Jupe supporters, that you are loyal. And 572 00:32:28,960 --> 00:32:31,360 Speaker 1: I think Ryan can't go out there and say this 573 00:32:31,400 --> 00:32:33,800 Speaker 1: guy really shouldn't be president of the United States. I 574 00:32:33,840 --> 00:32:36,560 Speaker 1: just think that ends his career right now in the 575 00:32:36,600 --> 00:32:38,760 Speaker 1: Republican Party, and I just think he can't do it. 576 00:32:39,000 --> 00:32:41,840 Speaker 1: Jed Cruz did it essentially and sort of made himself 577 00:32:41,880 --> 00:32:43,800 Speaker 1: for us, sort of the black sheep Maria. He was 578 00:32:43,880 --> 00:32:46,760 Speaker 1: already the black sheep Riah in Washington. But I think 579 00:32:46,800 --> 00:32:48,840 Speaker 1: that that means the battle for the soul of the 580 00:32:48,880 --> 00:32:52,040 Speaker 1: party moves to and I think that's what the Republicans think. 581 00:32:52,080 --> 00:32:54,920 Speaker 1: And Ryan has already told wealthy donors, look, we might 582 00:32:54,960 --> 00:32:57,720 Speaker 1: lose the House to help us. What I'm looking for 583 00:32:57,880 --> 00:33:00,280 Speaker 1: when I see September and I'm looking at campaign ads 584 00:33:00,280 --> 00:33:04,520 Speaker 1: and strategies, what you're do Republicans who are in trouble 585 00:33:04,760 --> 00:33:07,840 Speaker 1: actively run against Trump? Do they actually start to run 586 00:33:07,880 --> 00:33:13,080 Speaker 1: ads saying elect me president, I'll stop. Okay. The American Presidency. 587 00:33:13,120 --> 00:33:17,800 Speaker 1: Brown University, p Ols. Eleven thirty, Professor Schiller, real simple 588 00:33:17,800 --> 00:33:20,800 Speaker 1: Woodrow Wilson was sick. We all know that. We've all 589 00:33:20,800 --> 00:33:23,640 Speaker 1: read the history, and there's other stories of other presidents. 590 00:33:23,840 --> 00:33:27,360 Speaker 1: Many would say that Bush Senior was very, very exhausted 591 00:33:27,400 --> 00:33:29,440 Speaker 1: at the end of his presidency. I say that with 592 00:33:29,600 --> 00:33:33,400 Speaker 1: great respect for the war veteran. Do we care about 593 00:33:33,440 --> 00:33:37,280 Speaker 1: the health of candidates or do we get physicals after 594 00:33:37,320 --> 00:33:39,640 Speaker 1: they're elected. No. I mean I think we should care 595 00:33:39,640 --> 00:33:41,280 Speaker 1: about the health of candidates. I think that's a long 596 00:33:41,360 --> 00:33:44,560 Speaker 1: reasons why a younger candidate always appeals. But we don't 597 00:33:44,600 --> 00:33:47,400 Speaker 1: have that, right, we don't have that. But Ron Reagan, 598 00:33:47,720 --> 00:33:50,960 Speaker 1: you know, thirty six years ago, was older, you know, 599 00:33:51,160 --> 00:33:53,280 Speaker 1: as the same age as Hillary Clinton and Donald Trump. 600 00:33:53,440 --> 00:33:55,280 Speaker 1: That was a long time ago before a lot of 601 00:33:55,280 --> 00:33:57,800 Speaker 1: diagnostic and medical advances. So and we know that his 602 00:33:57,880 --> 00:34:00,280 Speaker 1: mind started to fall at the end. But I think 603 00:34:00,320 --> 00:34:03,320 Speaker 1: what both candidates have done that it's really smart, is 604 00:34:03,400 --> 00:34:07,280 Speaker 1: pick very qualified vps. You may disagree with their ideologies, 605 00:34:07,480 --> 00:34:09,600 Speaker 1: but I think Mike Pence and Tim Kane can run 606 00:34:09,640 --> 00:34:13,160 Speaker 1: the country. And I think knowing that makes it a 607 00:34:13,200 --> 00:34:15,560 Speaker 1: little bit more powerful and a little bit less worrisome 608 00:34:16,120 --> 00:34:19,239 Speaker 1: about the health of either primary candidate, uh you know 609 00:34:19,280 --> 00:34:22,280 Speaker 1: front owner candidate. Now, if something happens then before the election, 610 00:34:22,320 --> 00:34:25,319 Speaker 1: we ran into very major problems. But um, but I 611 00:34:25,360 --> 00:34:28,319 Speaker 1: think that's what I thought both candidates did that was 612 00:34:28,680 --> 00:34:32,759 Speaker 1: both super smart moves. Pick people that nobody thinks can't 613 00:34:32,800 --> 00:34:35,960 Speaker 1: run the country. If something happens to me, Professor Schiller, 614 00:34:36,040 --> 00:34:39,520 Speaker 1: I want to cut through the hot air, what is 615 00:34:39,560 --> 00:34:45,319 Speaker 1: the history of monumental changes in policy by candidates? Were 616 00:34:45,320 --> 00:34:49,680 Speaker 1: observing that? Now with Mr Trump on immigration, when you're 617 00:34:49,719 --> 00:34:52,960 Speaker 1: sitting in your office at Brown, what do you observe? Well, 618 00:34:53,000 --> 00:34:55,080 Speaker 1: I mean, we've seen a little bit of this, right, 619 00:34:55,160 --> 00:34:58,000 Speaker 1: I mean John Kerry was accused of this in two 620 00:34:58,000 --> 00:35:01,359 Speaker 1: thousand four h the Iraqui War becomes a whole sort 621 00:35:01,360 --> 00:35:03,480 Speaker 1: of when did I say, when did I oppose it? 622 00:35:03,480 --> 00:35:06,000 Speaker 1: When did I favorite So that that sort of engulfed 623 00:35:06,000 --> 00:35:09,200 Speaker 1: a lot of people, including Hillary Clinton. Um, but this 624 00:35:09,440 --> 00:35:13,080 Speaker 1: if he sticks with the flip flop. Now, remember Trump 625 00:35:13,160 --> 00:35:15,400 Speaker 1: changes his mind and changes what he says like on 626 00:35:15,480 --> 00:35:19,200 Speaker 1: a literally weekly, if not sometimes daily basis. So since 627 00:35:19,239 --> 00:35:22,440 Speaker 1: he hasn't really put forth a detailed plan on immigration, 628 00:35:22,760 --> 00:35:25,600 Speaker 1: I think he's got some wiggle room with sort of 629 00:35:25,600 --> 00:35:29,200 Speaker 1: people who haven't decided yet. His followers believe that this 630 00:35:29,320 --> 00:35:32,160 Speaker 1: was the fundamental core of his platform. So how he 631 00:35:32,200 --> 00:35:35,160 Speaker 1: goes out and explains this to people, I don't know, 632 00:35:35,280 --> 00:35:37,840 Speaker 1: But it may be that the core that like Donald Trump. 633 00:35:37,920 --> 00:35:40,560 Speaker 1: But looking about thirty eight percent of the country at 634 00:35:40,600 --> 00:35:42,000 Speaker 1: the moment, if you look at sort of the average 635 00:35:42,040 --> 00:35:44,640 Speaker 1: of polls, uh that they are going to vote for 636 00:35:44,719 --> 00:35:46,640 Speaker 1: him no matter what. And then there's another bunch of 637 00:35:46,640 --> 00:35:48,160 Speaker 1: people who are going to vote for him because he's 638 00:35:48,160 --> 00:35:51,360 Speaker 1: the Republican nominee. So he hasked some carte blanche to 639 00:35:51,400 --> 00:35:54,400 Speaker 1: do what he wants in terms of flip flopping. The 640 00:35:54,520 --> 00:35:57,440 Speaker 1: question is, you know, does he pick up anybody who 641 00:35:57,520 --> 00:35:59,319 Speaker 1: might be on the fence. And I just don't think 642 00:35:59,360 --> 00:36:02,759 Speaker 1: he does. I think that certainly latinos um. I don't 643 00:36:02,760 --> 00:36:05,359 Speaker 1: think our receptive audience to that message. They don't believe him. 644 00:36:05,400 --> 00:36:09,000 Speaker 1: The problem with foot propping is it completely destroys your credibility. Yeah, 645 00:36:09,080 --> 00:36:13,280 Speaker 1: that's the question I have. Does does Donald Trump lose 646 00:36:13,560 --> 00:36:17,319 Speaker 1: everybody who got him this far? Is there any way 647 00:36:17,360 --> 00:36:19,400 Speaker 1: he can he can really hold onto the core if 648 00:36:19,440 --> 00:36:22,920 Speaker 1: he switches that position. No, because he started out a 649 00:36:23,040 --> 00:36:27,080 Speaker 1: sort of let's bash the other, let's support them, let's 650 00:36:27,120 --> 00:36:29,200 Speaker 1: you know, they're the bad guys, were the good guys. 651 00:36:29,440 --> 00:36:33,360 Speaker 1: But it's more into a complete sort of movement to 652 00:36:33,480 --> 00:36:36,880 Speaker 1: regain America. So anybody who sees themselves as part of 653 00:36:36,920 --> 00:36:40,000 Speaker 1: that movement, mostly white up to some extent and mail, 654 00:36:40,800 --> 00:36:43,600 Speaker 1: will still look to Trump to guide them to their 655 00:36:43,640 --> 00:36:46,800 Speaker 1: promised land. And so I don't think anything really shakes 656 00:36:46,840 --> 00:36:49,400 Speaker 1: their attachment to Trump. Now it's moved beyond what he 657 00:36:49,440 --> 00:36:52,400 Speaker 1: said in terms of policy to sort of what he represents, 658 00:36:52,680 --> 00:36:56,279 Speaker 1: and they've perceived him as representing their interests and who 659 00:36:56,360 --> 00:36:59,799 Speaker 1: they are, and they feel left behind. And I think Democrats, 660 00:36:59,800 --> 00:37:01,920 Speaker 1: are ables or anybody else who wants to stop Trump 661 00:37:02,320 --> 00:37:06,120 Speaker 1: can't underestimate that sense of frustration, particularly in some parts 662 00:37:06,160 --> 00:37:08,440 Speaker 1: of the country. So I don't think it matters that 663 00:37:08,520 --> 00:37:10,279 Speaker 1: much to his supporters. I don't think it's going to 664 00:37:10,360 --> 00:37:13,399 Speaker 1: turn them off. I think conservatives don't trust him. We'll 665 00:37:13,560 --> 00:37:15,719 Speaker 1: just point to it as another reason not to trust them, 666 00:37:15,880 --> 00:37:18,640 Speaker 1: But they're not voting for him anyway. Well, speaking of trust, 667 00:37:19,000 --> 00:37:21,680 Speaker 1: Greg Vay of Horizon Investments writes this morning that the 668 00:37:21,719 --> 00:37:25,200 Speaker 1: most important person in this election maybe Julian Assan. She's 669 00:37:25,520 --> 00:37:30,120 Speaker 1: gonna probably drop some very damaging wiki leaks the documents 670 00:37:30,200 --> 00:37:35,320 Speaker 1: in October timed to hurt Hillary Clinton. I think I 671 00:37:35,760 --> 00:37:38,520 Speaker 1: really believe that most of the damage that has been 672 00:37:38,560 --> 00:37:40,719 Speaker 1: done to Hillary Clinton is self inflicted. I think this 673 00:37:40,760 --> 00:37:44,160 Speaker 1: is the Clinton problem, going back to Bill, the Clinton's 674 00:37:44,280 --> 00:37:48,359 Speaker 1: self inflict damage on themselves. They make decisions that are 675 00:37:48,440 --> 00:37:51,200 Speaker 1: questionable in terms of judgment. It doesn't mean she can't 676 00:37:51,280 --> 00:37:54,439 Speaker 1: run the country. And I think the big advantage Hillary 677 00:37:54,480 --> 00:37:58,160 Speaker 1: Clinton has running against Donald Trump is that people believe, 678 00:37:58,280 --> 00:38:00,200 Speaker 1: no matter what else you think about or she can 679 00:38:00,320 --> 00:38:04,160 Speaker 1: run the country and she's a moderating force. And right 680 00:38:04,200 --> 00:38:06,880 Speaker 1: now it looks like her campaign today, with their expected speaking, 681 00:38:07,120 --> 00:38:10,279 Speaker 1: wants to pivot away from Hillary Clinton per se. And 682 00:38:10,320 --> 00:38:12,040 Speaker 1: so what kind of America do you want? Right what 683 00:38:12,160 --> 00:38:13,680 Speaker 1: kind of America do you want? What kind of a 684 00:38:13,719 --> 00:38:15,600 Speaker 1: movement do you want to be part of? Away from her? 685 00:38:15,600 --> 00:38:18,800 Speaker 1: I don't think anything they leaked about her really honestly 686 00:38:18,840 --> 00:38:22,719 Speaker 1: moving forward unless she actually, you know, told somebody. I 687 00:38:22,880 --> 00:38:27,000 Speaker 1: think um, nothing will damage her among her core supporters either. UH. 688 00:38:27,040 --> 00:38:29,680 Speaker 1: And it isn't about Alorie's trustworthiness. I think that question 689 00:38:29,719 --> 00:38:32,439 Speaker 1: has been asked and answered. People have doubts. It's about 690 00:38:32,440 --> 00:38:34,120 Speaker 1: whether she will be a good president in terms of 691 00:38:34,200 --> 00:38:36,120 Speaker 1: running the country, and I think a lot of people 692 00:38:36,120 --> 00:38:38,720 Speaker 1: think that she will. Professor, thank you so much. Wendy 693 00:38:38,719 --> 00:38:40,520 Speaker 1: Schiller will speak to her more as we get to 694 00:38:40,600 --> 00:38:44,040 Speaker 1: the UH campaign to the election rather, and he can't 695 00:38:44,080 --> 00:38:47,960 Speaker 1: say enough about her effort at Brown University to reinvigorate 696 00:38:48,440 --> 00:38:54,160 Speaker 1: American politics. Thanks for listening to the Bloomberg Surveillance Podcast. 697 00:38:54,520 --> 00:38:59,560 Speaker 1: Subscribe and listen to interviews on iTunes, SoundCloud, or whichever 698 00:39:00,080 --> 00:39:03,680 Speaker 1: cast platform you prefer. I'm on Twitter at Tom Keane, 699 00:39:04,080 --> 00:39:08,040 Speaker 1: Michael McKee is at Economy. Before the podcast, you can 700 00:39:08,080 --> 00:39:18,480 Speaker 1: always catch us worldwide. I'm Bloomberg Radio. Who you put 701 00:39:18,520 --> 00:39:22,239 Speaker 1: your trust in matters. Investors have put their trust in 702 00:39:22,400 --> 00:39:26,640 Speaker 1: independent registered investment advisors to the tune of four trillion dollars. 703 00:39:27,080 --> 00:39:33,759 Speaker 1: Why learn more and find your independent advisor dot com.