1 00:00:02,400 --> 00:00:06,760 Speaker 1: Bloomberg Audio Studios, Podcasts, radio news. 2 00:00:11,600 --> 00:00:15,440 Speaker 2: This is the Bloomberg Surveillance Podcast. I'm Jonathan Ferrow, along 3 00:00:15,440 --> 00:00:18,400 Speaker 2: with Lisa Bromwitz and a Marie Hortern. Join us each 4 00:00:18,480 --> 00:00:21,360 Speaker 2: day for insight from the best in markets, economics, and 5 00:00:21,400 --> 00:00:24,720 Speaker 2: geopolitics from our global headquarters in New York City. We 6 00:00:24,760 --> 00:00:27,400 Speaker 2: are live on Bloomberg Television weekday mornings from six to 7 00:00:27,480 --> 00:00:31,000 Speaker 2: nine am Eastern. Subscribe to the podcast on Apple, Spotify, 8 00:00:31,200 --> 00:00:33,479 Speaker 2: or anywhere else you listen, and as always on the 9 00:00:33,479 --> 00:00:35,840 Speaker 2: Bloomberg Terminal and the Bloomberg Business App. 10 00:00:36,560 --> 00:00:38,720 Speaker 1: Have you received a callback from mister Musk. 11 00:00:40,080 --> 00:00:43,639 Speaker 3: Yes, Look, Elon's a good friend. We texted late last night. 12 00:00:43,720 --> 00:00:45,720 Speaker 3: We're going to talk this morning. I just want to 13 00:00:45,720 --> 00:00:48,519 Speaker 3: make sure that he understands what I think everybody on 14 00:00:48,560 --> 00:00:51,440 Speaker 3: Capitol Hill understands. This is not a spending bill, of 15 00:00:51,560 --> 00:00:55,680 Speaker 3: my friends, this is a budget reconciliation bill. And what 16 00:00:55,720 --> 00:00:58,560 Speaker 3: we're doing here is delivering the America First agenda. This 17 00:00:58,640 --> 00:01:01,240 Speaker 3: is all the President's priority and all the priorities of 18 00:01:01,280 --> 00:01:04,560 Speaker 3: the Republican Party. Everything we promise the American people, that 19 00:01:04,680 --> 00:01:06,759 Speaker 3: is what we are delivering with this piece of legislation. 20 00:01:06,800 --> 00:01:10,600 Speaker 3: And the reason we're using the reconciliation process is because 21 00:01:10,640 --> 00:01:12,560 Speaker 3: that is the only way to get around the sixty 22 00:01:12,640 --> 00:01:16,279 Speaker 3: vote threshold in the Senate. Everybody probably recognizes Chuck Schumer 23 00:01:16,319 --> 00:01:19,399 Speaker 3: and the Democrats are in no mood and not going 24 00:01:19,440 --> 00:01:22,679 Speaker 3: to be helpful in delivering President Trump's agenda for the people. 25 00:01:23,040 --> 00:01:24,399 Speaker 4: We have to do it this way. 26 00:01:24,800 --> 00:01:26,399 Speaker 3: We can do it with fifty one votes in the 27 00:01:26,440 --> 00:01:30,040 Speaker 3: Senate only, and that's the urgency of the hour, and 28 00:01:30,080 --> 00:01:31,120 Speaker 3: we have to do it quickly. 29 00:01:31,160 --> 00:01:32,839 Speaker 4: For all the reasons we can discuss this morning. 30 00:01:32,959 --> 00:01:34,760 Speaker 5: So did you get a sentence from Elon Muster in 31 00:01:34,760 --> 00:01:37,080 Speaker 5: those tex exchange that he was going to stop his 32 00:01:37,160 --> 00:01:39,960 Speaker 5: insistence on this bill that he thinks needs to be killed. 33 00:01:41,360 --> 00:01:43,480 Speaker 3: He seems pretty dug in right now, and I can't 34 00:01:43,560 --> 00:01:46,240 Speaker 3: quite understand the motivation behind it. But I would tell 35 00:01:46,280 --> 00:01:48,920 Speaker 3: you that what we're delivering in this bill is not 36 00:01:48,960 --> 00:01:52,600 Speaker 3: only historic tax cuts, but historic savings as well. 37 00:01:52,920 --> 00:01:53,840 Speaker 4: He seems to miss that. 38 00:01:54,040 --> 00:01:57,480 Speaker 3: I mean, the projection is that this legislation is going 39 00:01:57,520 --> 00:02:01,080 Speaker 3: to save us one point six trillion dollars with a t. Now, 40 00:02:01,120 --> 00:02:04,720 Speaker 3: there's never been a piece of legislation ever delivered in 41 00:02:04,720 --> 00:02:06,720 Speaker 3: the history of government on the face of the earth. 42 00:02:07,320 --> 00:02:10,160 Speaker 4: That saves that much money. So this is truly historic. Now, 43 00:02:10,240 --> 00:02:10,880 Speaker 4: is it enough? 44 00:02:11,080 --> 00:02:13,600 Speaker 3: No, because all three of us understand that we have 45 00:02:13,760 --> 00:02:16,840 Speaker 3: a large federal debt. We've had deficits for some time, 46 00:02:16,880 --> 00:02:19,400 Speaker 3: and it's a serious concern. In fact, it's the number 47 00:02:19,400 --> 00:02:22,720 Speaker 3: one threat to our national security. But this is the 48 00:02:22,760 --> 00:02:26,639 Speaker 3: biggest step in addressing that problem that Congress has ever delivered, 49 00:02:26,720 --> 00:02:27,720 Speaker 3: and we must do it. 50 00:02:27,960 --> 00:02:29,359 Speaker 4: And I will hasten to say this. 51 00:02:29,720 --> 00:02:32,679 Speaker 3: I've told Elon and tell everyone this is the first 52 00:02:32,840 --> 00:02:34,800 Speaker 3: of a series of steps that we will. 53 00:02:34,639 --> 00:02:38,040 Speaker 4: Take to bring that debt under control. But you can't 54 00:02:38,080 --> 00:02:39,000 Speaker 4: turn it on a dime. 55 00:02:39,480 --> 00:02:41,720 Speaker 3: It took us decades to get into this situation, so 56 00:02:41,760 --> 00:02:43,800 Speaker 3: we have to we have to do it incrementally, and 57 00:02:43,840 --> 00:02:46,520 Speaker 3: this is a huge step forward in that endeavor. 58 00:02:46,680 --> 00:02:50,960 Speaker 5: What's the driving force behind Elon Musk's problems with this bill? 59 00:02:51,040 --> 00:02:54,800 Speaker 5: Has he asked you directly to potentially keep the electric 60 00:02:54,880 --> 00:02:57,760 Speaker 5: vehicle benefits we saw under the Inflation Reduction Act of 61 00:02:57,760 --> 00:03:00,600 Speaker 5: the Biden error into the bill. 62 00:03:00,880 --> 00:03:04,480 Speaker 3: Look, I'll let everybody draw their own conclusions about Elon's motivations. 63 00:03:04,480 --> 00:03:07,400 Speaker 3: I'll tell you that I mean, obviously, the EV mandate 64 00:03:07,520 --> 00:03:12,040 Speaker 3: going away. I'm sure a concern for the leader of 65 00:03:12,080 --> 00:03:16,799 Speaker 3: Tesla and other things as well. But I think there's 66 00:03:16,800 --> 00:03:19,400 Speaker 3: a lot of confusion out there about what the legislation is. 67 00:03:19,440 --> 00:03:22,120 Speaker 3: There's certainly a lot of misinformation. I mean, the Democrats 68 00:03:22,120 --> 00:03:25,799 Speaker 3: have been engaged in this effort, this strategy for many, 69 00:03:25,840 --> 00:03:28,160 Speaker 3: many weeks and many months. But remember it took us 70 00:03:28,200 --> 00:03:31,120 Speaker 3: over a year to develop this piece of legislation. We 71 00:03:31,160 --> 00:03:34,160 Speaker 3: have eleven different committees in the House, all the areas 72 00:03:34,200 --> 00:03:38,320 Speaker 3: of jurisdiction that worked on the reconciliation effort to reconcile 73 00:03:38,320 --> 00:03:40,560 Speaker 3: the budget. And what we're going to deliver her again 74 00:03:40,680 --> 00:03:44,440 Speaker 3: is historic tax relief and savings. At the same time, 75 00:03:44,800 --> 00:03:47,640 Speaker 3: if we do not get this bill done, the tax 76 00:03:47,680 --> 00:03:50,480 Speaker 3: cuts of twenty seventeen, the tax cuts and JOBZAC will 77 00:03:50,560 --> 00:03:53,520 Speaker 3: expire at the end of December. Every American will receive 78 00:03:53,520 --> 00:03:56,480 Speaker 3: the largest tax increase in US history, all at once. 79 00:03:56,520 --> 00:03:59,400 Speaker 3: It would be devastating for the economy. So we've addressed 80 00:03:59,400 --> 00:04:03,640 Speaker 3: that here. The tax cuts permanent, and we've infused it 81 00:04:03,680 --> 00:04:06,320 Speaker 3: with a pro growth series of policies that will get 82 00:04:06,320 --> 00:04:08,680 Speaker 3: the economy going again. It will be jet fueled to 83 00:04:08,680 --> 00:04:11,400 Speaker 3: the economy because we're going to reduce wasteful spending. We're 84 00:04:11,440 --> 00:04:14,280 Speaker 3: going to reduce taxes, and we're going to reduce regulations 85 00:04:14,320 --> 00:04:16,839 Speaker 3: as well, and that is what will allow job creators 86 00:04:16,839 --> 00:04:19,080 Speaker 3: in the energy sector and everyone else to get going again. 87 00:04:19,120 --> 00:04:21,640 Speaker 5: And your version of the bill, of course, increases the 88 00:04:21,680 --> 00:04:25,760 Speaker 5: salt deduction cap, which yesterday Senate Majority Leader John Thune said, quote, 89 00:04:25,839 --> 00:04:28,480 Speaker 5: there isn't a single Republican senator who cares much about 90 00:04:28,520 --> 00:04:31,400 Speaker 5: the salt issue. You and I both know you cannot 91 00:04:31,480 --> 00:04:35,039 Speaker 5: pass this bill without increasing the salt deduction cap. How 92 00:04:35,080 --> 00:04:39,400 Speaker 5: do you envision that deduction changing given the fact that 93 00:04:39,520 --> 00:04:43,200 Speaker 5: no senator Republican senator wants a vote for this. 94 00:04:44,320 --> 00:04:46,000 Speaker 4: Well, I appreciate that they don't. 95 00:04:46,040 --> 00:04:48,120 Speaker 3: They all come from red states, right as do I, 96 00:04:48,560 --> 00:04:52,360 Speaker 3: and we have very different perspective on salt than our 97 00:04:52,400 --> 00:04:55,120 Speaker 3: colleagues in the Blue states, for example, in California and 98 00:04:55,160 --> 00:04:58,039 Speaker 3: New New York, in New Jersey. But that is the 99 00:04:58,080 --> 00:05:00,880 Speaker 3: reality in the House. Remembering they have to remember my 100 00:05:00,920 --> 00:05:03,159 Speaker 3: senate friends and colleagues have to remember I have to 101 00:05:03,200 --> 00:05:05,320 Speaker 3: deliver two hundred and seventeen votes to get that thing 102 00:05:05,360 --> 00:05:07,840 Speaker 3: across the line if they modify it. So I had 103 00:05:07,960 --> 00:05:11,279 Speaker 3: lunch with my senate friends Tuesday, last two weeks ago 104 00:05:11,360 --> 00:05:13,720 Speaker 3: before we passed the bill in the House on that Thursday, 105 00:05:14,160 --> 00:05:17,719 Speaker 3: and I encouraged them to modify it as little as possible, 106 00:05:17,800 --> 00:05:20,159 Speaker 3: right because I gave a metaphor. I said, my friends, 107 00:05:20,200 --> 00:05:22,040 Speaker 3: I am crossing the Grand Canyon on a piece of 108 00:05:22,120 --> 00:05:25,560 Speaker 3: dental flaws. Okay, the equilibrium that we reached here took 109 00:05:25,680 --> 00:05:28,800 Speaker 3: quite a bit of time to get to where we are, 110 00:05:29,160 --> 00:05:31,240 Speaker 3: and you can't load me up on either side. And 111 00:05:31,320 --> 00:05:33,919 Speaker 3: if you go and slash the salt cap that we 112 00:05:34,000 --> 00:05:36,800 Speaker 3: negotiated carefully for over a year, it's going to make 113 00:05:36,839 --> 00:05:39,159 Speaker 3: it very difficult for me to deliver the necessary number 114 00:05:39,160 --> 00:05:41,800 Speaker 3: of votes. Remembering I can only lose three in the House. 115 00:05:42,080 --> 00:05:44,160 Speaker 3: They can only lose three in the Senate to get 116 00:05:44,160 --> 00:05:44,640 Speaker 3: this done. 117 00:05:44,680 --> 00:05:45,839 Speaker 4: So we're all working together. 118 00:05:45,880 --> 00:05:48,880 Speaker 3: It's one team, House and Senate together, united in this effort. 119 00:05:49,720 --> 00:05:52,840 Speaker 3: They understand that, and I think they understand certainly Leader 120 00:05:52,880 --> 00:05:55,000 Speaker 3: Thun and the leaders over their understand the complexity of 121 00:05:55,000 --> 00:05:55,760 Speaker 3: what we're having to deal. 122 00:05:55,680 --> 00:05:56,560 Speaker 1: With here, Spiky Johnson. 123 00:05:56,560 --> 00:05:57,640 Speaker 6: Just to sort of put a bow on it, so 124 00:05:57,720 --> 00:05:59,720 Speaker 6: forty thousands still likely to remain the cap. 125 00:06:02,040 --> 00:06:04,359 Speaker 3: That's what we negotiated here, and I'm certainly trying to 126 00:06:04,360 --> 00:06:06,840 Speaker 3: hold to that number, and look, we've paid for it. 127 00:06:06,920 --> 00:06:09,080 Speaker 3: I think we've got it worked out and all the 128 00:06:09,120 --> 00:06:11,520 Speaker 3: math and the legislation, and I think it's something that 129 00:06:11,920 --> 00:06:13,400 Speaker 3: I know they don't they're not in love with it, 130 00:06:13,400 --> 00:06:15,680 Speaker 3: but I certainly hope they'll tolerated so we can maintain 131 00:06:16,560 --> 00:06:17,200 Speaker 3: our vote tally. 132 00:06:17,279 --> 00:06:19,800 Speaker 6: Over here, Speaker Johnson, as you walk that piece of 133 00:06:19,839 --> 00:06:22,560 Speaker 6: dentalfloss over the Grand Canyon. There is this question of 134 00:06:22,600 --> 00:06:25,560 Speaker 6: how the bill is currently being used, whether it's for 135 00:06:25,880 --> 00:06:30,120 Speaker 6: budget negotiations and budget reconciliation over the next decade, or 136 00:06:30,160 --> 00:06:34,880 Speaker 6: whether it's to negotiate trade agreements. There is two point 137 00:06:34,880 --> 00:06:38,560 Speaker 6: eight trillion dollars of revenue that is being penciled in 138 00:06:38,800 --> 00:06:43,159 Speaker 6: by the Congressional Budget Office from tariffs that might be 139 00:06:43,279 --> 00:06:46,159 Speaker 6: used as a negotiating tactic might not be How do 140 00:06:46,200 --> 00:06:49,640 Speaker 6: you understand the way that tariffs are looked at as 141 00:06:49,680 --> 00:06:52,039 Speaker 6: part of this budget balancing Act? 142 00:06:53,120 --> 00:06:56,039 Speaker 3: Well, it hasn't been included in the calculations, and that's 143 00:06:56,080 --> 00:06:59,040 Speaker 3: because groups like the CBO, the Congressional Budget Office, as 144 00:06:59,080 --> 00:07:01,240 Speaker 3: you noted, won't give us any credit for that. 145 00:07:01,320 --> 00:07:02,359 Speaker 4: But it is very real. 146 00:07:02,400 --> 00:07:04,560 Speaker 3: I mean, the revenue is real, and it is realized 147 00:07:04,600 --> 00:07:07,960 Speaker 3: and it's not included in the calculation that we've made 148 00:07:08,040 --> 00:07:11,240 Speaker 3: or they've made, but obviously it's a big factor. We 149 00:07:11,320 --> 00:07:14,680 Speaker 3: believe that we're going to bring about a roaring economy again, 150 00:07:14,720 --> 00:07:18,320 Speaker 3: and it's not based on conjecture or ground list optimism. 151 00:07:18,520 --> 00:07:20,680 Speaker 3: I mean, this is based on the history. We did 152 00:07:20,720 --> 00:07:23,080 Speaker 3: this in twenty seventeen, after the first two years of 153 00:07:23,120 --> 00:07:25,640 Speaker 3: the Trump administration, when we passed the tax cuts and 154 00:07:25,720 --> 00:07:28,960 Speaker 3: Jobs ac We reduce taxes, we reduced regulations, and the 155 00:07:29,040 --> 00:07:32,080 Speaker 3: economy was raringw I mean you all remember it. Before COVID, 156 00:07:32,080 --> 00:07:33,920 Speaker 3: we had the greatest economy in the history of the world. 157 00:07:33,920 --> 00:07:37,720 Speaker 3: I mean, everybody was doing better every demographic wages were up, 158 00:07:37,840 --> 00:07:41,600 Speaker 3: the job participation numbers where at record highs, inflation was down, 159 00:07:41,600 --> 00:07:43,240 Speaker 3: and manageable things were going great. 160 00:07:43,280 --> 00:07:46,240 Speaker 4: And then COVID hit. So we're going to do that same. 161 00:07:46,120 --> 00:07:49,200 Speaker 3: Series of policies, implement that same philosophy, but this time, 162 00:07:49,240 --> 00:07:51,080 Speaker 3: as I say, on steroids, and. 163 00:07:51,040 --> 00:07:52,640 Speaker 4: It's going to make a major difference for every and 164 00:07:52,680 --> 00:07:53,280 Speaker 4: everybody's life. 165 00:07:53,360 --> 00:07:55,320 Speaker 6: Speaker John said, a lot of people in Marcus are 166 00:07:55,360 --> 00:07:58,239 Speaker 6: concerned about a number of provisions here and actually don't 167 00:07:58,280 --> 00:08:01,400 Speaker 6: think they will spur growth. One of them being Section 168 00:08:01,560 --> 00:08:05,200 Speaker 6: eight ninety nine, which talks about taxing foreign investment in 169 00:08:05,240 --> 00:08:09,600 Speaker 6: the United States from specific countries that have non tariff 170 00:08:09,640 --> 00:08:13,000 Speaker 6: barriers like the VAT tax and other things that have 171 00:08:13,120 --> 00:08:17,080 Speaker 6: been contentious during negotiations of trade deals. 172 00:08:17,240 --> 00:08:19,280 Speaker 1: How much do you see that dampening? 173 00:08:19,320 --> 00:08:21,160 Speaker 6: I mean, is that a concern for you, because right 174 00:08:21,200 --> 00:08:24,280 Speaker 6: now around the world there are people wondering whether they 175 00:08:24,320 --> 00:08:27,360 Speaker 6: can still invest in the United States without getting penalized 176 00:08:27,400 --> 00:08:27,680 Speaker 6: for it. 177 00:08:28,880 --> 00:08:33,360 Speaker 3: Yes, Look, there's a complexity to the tariff negotiations. I mean, 178 00:08:33,679 --> 00:08:35,720 Speaker 3: we tip our hat to the White House, and President's 179 00:08:35,720 --> 00:08:38,120 Speaker 3: strategy is working. As you know, there's more than seventy 180 00:08:38,160 --> 00:08:41,720 Speaker 3: five countries renegotiating their trade agreements right now, finalizing that 181 00:08:41,760 --> 00:08:45,599 Speaker 3: even as we speak, that's going to be better for America. 182 00:08:45,120 --> 00:08:47,200 Speaker 4: Because it will be more fair. You know. 183 00:08:47,720 --> 00:08:50,320 Speaker 3: I'm always liking myself to be a Reagan Republican and 184 00:08:50,400 --> 00:08:54,040 Speaker 3: free trade is one of our core principles that we've 185 00:08:54,040 --> 00:08:57,920 Speaker 3: all supported over the years. And every time I would 186 00:08:57,920 --> 00:08:59,520 Speaker 3: say that over the last several years to President Trump, 187 00:08:59,559 --> 00:09:02,520 Speaker 3: he would say, yes, free and fair trade, and he's right. 188 00:09:02,679 --> 00:09:05,160 Speaker 3: I mean, this is a disparity that must have needed 189 00:09:05,160 --> 00:09:07,600 Speaker 3: to be addressed and it has been, so we think 190 00:09:08,080 --> 00:09:10,000 Speaker 3: in total, this is going to be good when it's all, 191 00:09:10,040 --> 00:09:12,800 Speaker 3: when all the dust settles on the tariff negotiations and 192 00:09:12,840 --> 00:09:14,719 Speaker 3: the new trade agreement. So it's going to be good 193 00:09:14,720 --> 00:09:17,480 Speaker 3: for America and good for the world. And so we're 194 00:09:17,480 --> 00:09:20,120 Speaker 3: factoring that in. We're working in tandem with the White House, 195 00:09:20,160 --> 00:09:22,200 Speaker 3: and it's it's part of going to stay in calculation 196 00:09:22,280 --> 00:09:22,559 Speaker 3: in the la. 197 00:09:22,559 --> 00:09:25,240 Speaker 6: Laker Johnson, just to be clear that provision will stay 198 00:09:25,240 --> 00:09:26,320 Speaker 6: in that is important to you. 199 00:09:28,040 --> 00:09:28,960 Speaker 4: Look, I think it is. 200 00:09:29,040 --> 00:09:32,040 Speaker 3: I mean, obviously the bill is still a live instrument 201 00:09:32,080 --> 00:09:34,320 Speaker 3: that's being worked on in the Senate, so we'll see 202 00:09:34,400 --> 00:09:37,320 Speaker 3: if they modify those provisions. But I think for now, 203 00:09:37,360 --> 00:09:39,640 Speaker 3: I think that's good policy for US. And I want 204 00:09:39,679 --> 00:09:42,679 Speaker 3: to say to foreign investors, you're in good stead to 205 00:09:43,600 --> 00:09:45,560 Speaker 3: invest in America. This is the time to do it, 206 00:09:45,600 --> 00:09:47,960 Speaker 3: because the American economy is about to take off again 207 00:09:48,080 --> 00:09:49,720 Speaker 3: and it's going to be good for you and good. 208 00:09:49,600 --> 00:09:50,079 Speaker 4: For the world. 209 00:09:50,600 --> 00:09:53,640 Speaker 3: We're the largest trading partner for most other nations. They 210 00:09:53,640 --> 00:09:55,920 Speaker 3: need America, and a strong America is good for the 211 00:09:55,920 --> 00:09:57,760 Speaker 3: whole world. And that is what we are going to 212 00:09:57,760 --> 00:10:00,840 Speaker 3: bring about with these sound policies and pro growth initiatives. 213 00:10:00,960 --> 00:10:03,840 Speaker 5: Speaking, Johnson, you and your colleagues have a self imposed 214 00:10:03,920 --> 00:10:07,000 Speaker 5: July fourth deadline. Partially that is because you have to 215 00:10:07,080 --> 00:10:10,640 Speaker 5: raise the debt ceiling. Are you considering raising the debt 216 00:10:10,679 --> 00:10:14,120 Speaker 5: limit if this deal isn't finished by July fourth with 217 00:10:14,160 --> 00:10:16,640 Speaker 5: a different measure, Well. 218 00:10:16,520 --> 00:10:17,760 Speaker 4: It'd be very difficult to do it. 219 00:10:17,800 --> 00:10:21,080 Speaker 3: I mean, it would require a bipartisan measure in that regard, 220 00:10:21,120 --> 00:10:22,960 Speaker 3: and I would like to believe that Chuck Schumer and 221 00:10:22,960 --> 00:10:24,719 Speaker 3: the Democrats and the Senate would do the right thing. 222 00:10:24,760 --> 00:10:29,000 Speaker 3: But I wouldn't count on that. That debt cliff, as 223 00:10:29,120 --> 00:10:31,960 Speaker 3: we're regarding it, is coming soon, and that's why Secretary 224 00:10:31,960 --> 00:10:33,760 Speaker 3: Besson has said we've got to get this done by 225 00:10:33,760 --> 00:10:35,920 Speaker 3: Independence Day, and I think it'd be a great celebration 226 00:10:36,000 --> 00:10:37,880 Speaker 3: for all of us. But it's not just because of 227 00:10:37,920 --> 00:10:41,040 Speaker 3: the debt ceiling. It's also because we need to get 228 00:10:41,080 --> 00:10:44,560 Speaker 3: tax relief in this new roaring economy to the American 229 00:10:44,559 --> 00:10:47,280 Speaker 3: people as quickly as possible. They're owed that and this 230 00:10:47,360 --> 00:10:48,960 Speaker 3: is going to be a great thing for everyone. And 231 00:10:49,440 --> 00:10:51,480 Speaker 3: you know, I have to also think about the politics 232 00:10:51,520 --> 00:10:53,360 Speaker 3: of it. Right, we have a midterm election coming up 233 00:10:53,400 --> 00:10:55,959 Speaker 3: in twenty twenty six. If we get this done soon 234 00:10:56,080 --> 00:10:59,680 Speaker 3: and quickly this summer, then everyone will feel those effects 235 00:10:59,720 --> 00:11:02,959 Speaker 3: before they have to go vote again in that midterm election. 236 00:11:03,040 --> 00:11:04,760 Speaker 3: We want to keep the House majority and keep this 237 00:11:04,840 --> 00:11:06,880 Speaker 3: going for four years for President Trump and not two. 238 00:11:07,320 --> 00:11:09,280 Speaker 3: And if we lost the majority, there's no doubt that 239 00:11:09,320 --> 00:11:11,920 Speaker 3: the House Democrats would try to impeach the president and 240 00:11:12,000 --> 00:11:15,760 Speaker 3: everything would be truly chaotic for investors and job creators 241 00:11:15,840 --> 00:11:18,559 Speaker 3: and consumers. So we have to keep this going, keep 242 00:11:18,600 --> 00:11:21,199 Speaker 3: the momentum going. The timeline's very important, and that's why 243 00:11:21,520 --> 00:11:23,800 Speaker 3: I put this on a very aggressive schedule. I said 244 00:11:23,920 --> 00:11:25,280 Speaker 3: back in the early part of this year that we 245 00:11:25,280 --> 00:11:27,360 Speaker 3: would pass the big, beautiful bill out of the House 246 00:11:27,840 --> 00:11:30,760 Speaker 3: before Memorial Day, and people laughed, they mocked me when 247 00:11:30,760 --> 00:11:32,640 Speaker 3: I said that. But we beat it by four days. 248 00:11:32,800 --> 00:11:34,360 Speaker 3: We're going to stay on track and we're going to 249 00:11:34,360 --> 00:11:35,400 Speaker 3: deliver for the American people. 250 00:11:35,440 --> 00:11:38,599 Speaker 5: Well, you have exactly twenty nine days to hit that deadline. 251 00:11:38,640 --> 00:11:41,360 Speaker 5: Are you saying there's no plan B for raising the 252 00:11:41,400 --> 00:11:44,840 Speaker 5: debt ceiling if this bill is not done between House 253 00:11:44,880 --> 00:11:46,280 Speaker 5: Republicans and House Senators. 254 00:11:47,280 --> 00:11:49,960 Speaker 3: Look, Republicans in a House and Senate will deliver and 255 00:11:50,040 --> 00:11:51,960 Speaker 3: we'll take care of our business one way or the other. 256 00:11:52,320 --> 00:11:53,360 Speaker 4: But I'm just telling you. 257 00:11:54,120 --> 00:11:57,000 Speaker 3: The smartest and most efficacious way to do this is 258 00:11:57,040 --> 00:11:58,959 Speaker 3: to stay on this schedule and deliver for the people. 259 00:11:58,960 --> 00:12:01,680 Speaker 3: And that's what we're dog determined to do or laser 260 00:12:01,720 --> 00:12:04,200 Speaker 3: focused on it. And if we take our focus off 261 00:12:04,200 --> 00:12:07,280 Speaker 3: of that, then the strategy doesn't work. So I'm telling 262 00:12:07,320 --> 00:12:08,280 Speaker 3: you that we are working on that. 263 00:12:08,360 --> 00:12:08,600 Speaker 4: Regard. 264 00:12:08,720 --> 00:12:11,439 Speaker 3: Leader Thuon and I are in constant communication. He understands 265 00:12:11,440 --> 00:12:14,040 Speaker 3: that deadline as well. The Secretary of the Treasury and 266 00:12:14,520 --> 00:12:17,640 Speaker 3: the NEEC and all the leaders in the White House 267 00:12:18,120 --> 00:12:19,520 Speaker 3: and the administration understand that. 268 00:12:19,600 --> 00:12:20,640 Speaker 4: So we're going to get it done. 269 00:12:20,840 --> 00:12:23,360 Speaker 6: Speaker Johnson, how closely are you watching the bond markets 270 00:12:23,440 --> 00:12:25,600 Speaker 6: right now, given the fact that we've seen a real 271 00:12:26,000 --> 00:12:30,199 Speaker 6: sense of concern, particularly in longer duration US treasuries. 272 00:12:31,640 --> 00:12:32,520 Speaker 4: We watch it closely. 273 00:12:32,880 --> 00:12:36,280 Speaker 3: Look, I really do believe that delivering this historic legislation 274 00:12:36,400 --> 00:12:38,559 Speaker 3: is going to be critically important for a lot of reasons, 275 00:12:38,600 --> 00:12:41,000 Speaker 3: not the least of which is that Congress can send 276 00:12:41,000 --> 00:12:43,960 Speaker 3: a very important signal to the bond markets, to the 277 00:12:43,960 --> 00:12:48,200 Speaker 3: stock market, to investors everywhere that we're very serious about this, 278 00:12:48,360 --> 00:12:51,120 Speaker 3: not only in getting the US economy roaring again, but 279 00:12:51,240 --> 00:12:54,440 Speaker 3: also in addressing the long term debt, and I think 280 00:12:54,480 --> 00:12:56,680 Speaker 3: that's an important thing for everyone to understand. We have 281 00:12:56,760 --> 00:12:59,600 Speaker 3: a strategy that's some multiple steps, as I said, multiple 282 00:12:59,600 --> 00:13:03,760 Speaker 3: steps rategy to address this over the next year, two years, 283 00:13:03,840 --> 00:13:06,280 Speaker 3: three years, and we're going to get the US economy 284 00:13:06,320 --> 00:13:09,720 Speaker 3: back on sound footing. We're the party of fiscal responsibility, 285 00:13:10,000 --> 00:13:11,760 Speaker 3: and you'll see that demonstrated day after day. 286 00:13:11,760 --> 00:13:23,520 Speaker 6: Here President Trump's slamming FED cher J. 287 00:13:23,679 --> 00:13:25,480 Speaker 1: Powell once again saying. 288 00:13:25,320 --> 00:13:28,960 Speaker 6: Quote too late, Powell must lower interest rates after a 289 00:13:28,960 --> 00:13:32,720 Speaker 6: week ADP data. Krishna Guha of Evercore writing it would 290 00:13:32,720 --> 00:13:36,360 Speaker 6: take a large and rapid increase in unemployment driven by 291 00:13:36,400 --> 00:13:38,920 Speaker 6: increasing layoffs to cut in July. It is easy for 292 00:13:38,960 --> 00:13:41,960 Speaker 6: the FED to justify remaining and await and see mode. 293 00:13:42,160 --> 00:13:43,160 Speaker 1: Krishna joins us. 294 00:13:43,080 --> 00:13:44,959 Speaker 6: Now, Trisha, thank you so much for being with us. 295 00:13:45,200 --> 00:13:46,400 Speaker 1: A lot of people agree with you. 296 00:13:46,480 --> 00:13:48,920 Speaker 6: At the same time, a September rate cut is pretty 297 00:13:49,000 --> 00:13:51,920 Speaker 6: much baked in. Does that seem appropriate to you based 298 00:13:51,960 --> 00:13:54,679 Speaker 6: on the economic data that has been weakening over the 299 00:13:54,760 --> 00:13:55,679 Speaker 6: past couple of days. 300 00:13:57,120 --> 00:14:01,240 Speaker 7: Look, I have a base case of a September cut, 301 00:14:01,280 --> 00:14:04,360 Speaker 7: but I don't think it's anything close to a slam dump. 302 00:14:05,160 --> 00:14:08,080 Speaker 7: I think right now, the question is does the labor 303 00:14:08,120 --> 00:14:12,360 Speaker 7: market weaken enough over the next several months for the 304 00:14:12,400 --> 00:14:15,559 Speaker 7: FED to judge that it makes sense to lean against 305 00:14:15,600 --> 00:14:19,360 Speaker 7: that weakening where the cuts in September, I think to 306 00:14:19,440 --> 00:14:22,640 Speaker 7: get that you need unemployment moving out to something like 307 00:14:22,800 --> 00:14:25,920 Speaker 7: four and a half percent by September. I think it's 308 00:14:25,960 --> 00:14:27,640 Speaker 7: a close call, to be honest. 309 00:14:28,400 --> 00:14:29,880 Speaker 6: And this is the reason why I think a lot 310 00:14:29,880 --> 00:14:32,480 Speaker 6: of people are looking at whether it is just going 311 00:14:32,520 --> 00:14:34,560 Speaker 6: to be one print, whether it's going to be a 312 00:14:34,600 --> 00:14:35,800 Speaker 6: collection of prints. 313 00:14:36,040 --> 00:14:37,520 Speaker 1: Something that caught my eye yesterday. 314 00:14:37,520 --> 00:14:41,440 Speaker 6: We all are so data dependent, and yet this Bureau. 315 00:14:41,120 --> 00:14:42,880 Speaker 1: Of Labor Statistics put out. 316 00:14:42,800 --> 00:14:46,800 Speaker 6: In a dendum talking about how they collected fewer data 317 00:14:46,880 --> 00:14:49,960 Speaker 6: points in the April CPI survey because of a lack 318 00:14:50,000 --> 00:14:53,560 Speaker 6: of staff. And there's been this speculation about the accuracy 319 00:14:53,600 --> 00:14:56,880 Speaker 6: of some of these surveys as employment has gone down 320 00:14:56,960 --> 00:15:01,240 Speaker 6: and frankly, as responses have gone down. Cretence, do you 321 00:15:01,360 --> 00:15:03,440 Speaker 6: give to some of the data that we get? Do 322 00:15:03,480 --> 00:15:05,360 Speaker 6: you think that it still has the same integrity? 323 00:15:07,480 --> 00:15:10,800 Speaker 7: So in order to make good judgments, you have to 324 00:15:10,880 --> 00:15:13,680 Speaker 7: have good data. It's as simple as that. Now, I 325 00:15:13,760 --> 00:15:18,720 Speaker 7: still think that the US government official statistics ba bls 326 00:15:19,160 --> 00:15:23,520 Speaker 7: are still the gold standard, but we have to be 327 00:15:23,600 --> 00:15:26,240 Speaker 7: careful because, as you say, some response rates have been 328 00:15:26,240 --> 00:15:29,920 Speaker 7: coming down, and now we're starting to worry about staffing 329 00:15:30,000 --> 00:15:34,120 Speaker 7: cutbacks and other funding cutbacks potentially weakening the quality of 330 00:15:34,120 --> 00:15:37,520 Speaker 7: these data series going forward. So in any moment in time, 331 00:15:37,560 --> 00:15:39,640 Speaker 7: you want to look at the holistic picture of the data, 332 00:15:39,760 --> 00:15:43,400 Speaker 7: all the private sector data, including very much on the employments, 333 00:15:43,680 --> 00:15:46,960 Speaker 7: challenger layoffs, indeed, job postings and so on, as a 334 00:15:46,960 --> 00:15:49,840 Speaker 7: crosscheck against the official data, and sometimes getting ahead of 335 00:15:49,840 --> 00:15:52,480 Speaker 7: the official data. But I'll tell you, having seen for instance, 336 00:15:53,120 --> 00:15:55,880 Speaker 7: how problematic it has become in the UK, where some 337 00:15:55,920 --> 00:15:59,560 Speaker 7: of that core official government labor data just hasn't been 338 00:15:59,600 --> 00:16:03,080 Speaker 7: reliable for some time, it can be very, very damaging. 339 00:16:03,360 --> 00:16:04,880 Speaker 1: And that's a much smaller economy. 340 00:16:04,920 --> 00:16:06,640 Speaker 5: So if you're not one hundred if you're not one 341 00:16:06,720 --> 00:16:10,240 Speaker 5: hundred percent trusting the data, you don't have policy uncertainty. 342 00:16:09,840 --> 00:16:10,640 Speaker 1: In Washington, DC. 343 00:16:11,000 --> 00:16:13,800 Speaker 5: What's your north start of these days? 344 00:16:14,920 --> 00:16:18,080 Speaker 7: Well, I think, look, I think we know from first 345 00:16:18,120 --> 00:16:21,080 Speaker 7: principles that tariffs are going to slow growth and push 346 00:16:21,160 --> 00:16:25,640 Speaker 7: up prices. Right, what we're trying to understand is the 347 00:16:25,800 --> 00:16:30,960 Speaker 7: relative balance of those effects. I think that we're going 348 00:16:31,040 --> 00:16:33,520 Speaker 7: to learn a fair amount over the next several months 349 00:16:33,560 --> 00:16:36,240 Speaker 7: on both of these counts. But my hunches that will 350 00:16:36,400 --> 00:16:39,000 Speaker 7: learn more on the labor side than we will about 351 00:16:39,000 --> 00:16:41,760 Speaker 7: what really matters on inflation, which is not the first 352 00:16:41,880 --> 00:16:44,440 Speaker 7: round price impact, but whether it starts to get embedded 353 00:16:44,480 --> 00:16:48,680 Speaker 7: into underlying inflation dynamics. So I'm going to be looking 354 00:16:48,680 --> 00:16:52,680 Speaker 7: at everything official and private sector company level data and 355 00:16:52,760 --> 00:16:54,880 Speaker 7: earnings calls and so on. But what I'm really trying 356 00:16:54,880 --> 00:16:58,440 Speaker 7: to understand at this point is do those inflation expectations 357 00:16:58,480 --> 00:17:01,960 Speaker 7: stay anchored A, because that's the precondition for even considering cuts, 358 00:17:02,200 --> 00:17:04,960 Speaker 7: And then B do we get a material enough weakening 359 00:17:05,000 --> 00:17:07,840 Speaker 7: in the labor market for the FED to want to 360 00:17:07,840 --> 00:17:11,040 Speaker 7: cut to lean against that gathering any momentum. I think 361 00:17:11,040 --> 00:17:13,000 Speaker 7: it may still be a little while before we really 362 00:17:13,000 --> 00:17:15,520 Speaker 7: get visibility on this. My hunch is that will have 363 00:17:15,600 --> 00:17:18,240 Speaker 7: a feel for that how much the labor market is 364 00:17:18,240 --> 00:17:22,119 Speaker 7: deteriorating by September, which makes it the logical moment to 365 00:17:22,240 --> 00:17:23,800 Speaker 7: call the next move on rates. 366 00:17:24,520 --> 00:17:28,160 Speaker 8: Hi christ nat Lori Calvasina from RBC. I've been getting 367 00:17:27,680 --> 00:17:30,280 Speaker 8: the good to see you. I've been getting a lot 368 00:17:30,280 --> 00:17:33,000 Speaker 8: of questions on small caps which are related to rate cuts, 369 00:17:33,000 --> 00:17:35,879 Speaker 8: And I'm wondering in your conversations, are you starting to 370 00:17:35,880 --> 00:17:38,840 Speaker 8: see expectations that the Fed is actually going to do 371 00:17:38,920 --> 00:17:42,240 Speaker 8: something in September? Are those moving up? Are those moving down? 372 00:17:42,280 --> 00:17:44,040 Speaker 8: There's been a lot of dispersion, There's been a lot 373 00:17:44,080 --> 00:17:46,080 Speaker 8: of shifts in kind of the vibe on the ground. 374 00:17:46,119 --> 00:17:47,800 Speaker 8: What's your read of the tea leaves right now? 375 00:17:49,400 --> 00:17:54,080 Speaker 7: So the market has has with this most recent sort 376 00:17:54,080 --> 00:17:56,919 Speaker 7: of patch of week of data with ADP and with 377 00:17:57,760 --> 00:18:02,800 Speaker 7: ISM services, markets move to price in more conviction, high 378 00:18:02,800 --> 00:18:06,800 Speaker 7: conviction around a September move, and you know, and more 379 00:18:06,840 --> 00:18:09,359 Speaker 7: than two cuts discounted through the end of the year. 380 00:18:09,920 --> 00:18:12,520 Speaker 7: And you know, obviously, if we get more rate cuts, 381 00:18:12,800 --> 00:18:16,680 Speaker 7: provided that's not in the context of a recession, and 382 00:18:16,880 --> 00:18:19,800 Speaker 7: that's a modern weekning that the Fed's leaning against, that 383 00:18:19,880 --> 00:18:23,959 Speaker 7: can potentially help your small caps and other stocks. But 384 00:18:24,000 --> 00:18:26,119 Speaker 7: I think we've got to be a little careful interpreting this. 385 00:18:27,280 --> 00:18:30,760 Speaker 7: I don't think we should interpret market pricing is saying 386 00:18:31,080 --> 00:18:33,600 Speaker 7: September is anything close to certain, and I say there's 387 00:18:33,600 --> 00:18:36,280 Speaker 7: somebody who has it as a narrow base case. I 388 00:18:36,280 --> 00:18:39,280 Speaker 7: think the reality is that there is still very much 389 00:18:39,280 --> 00:18:42,040 Speaker 7: a pathway here where we end up with no cuts 390 00:18:42,080 --> 00:18:45,120 Speaker 7: because the labor market doesn't weaken all that much. There's 391 00:18:45,160 --> 00:18:47,000 Speaker 7: a pathway where we get two or three cuts, and 392 00:18:47,040 --> 00:18:49,840 Speaker 7: that the intermediate case, where there's some softening and the 393 00:18:49,880 --> 00:18:52,919 Speaker 7: FEDS leaning against that as it emerges, but not before 394 00:18:53,000 --> 00:18:55,760 Speaker 7: it goes, and then it is still the recession case, 395 00:18:55,880 --> 00:18:57,840 Speaker 7: you know, is that twenty five thirty percent is it 396 00:18:57,880 --> 00:19:00,679 Speaker 7: a bit more, a bit less, And if we do 397 00:19:00,880 --> 00:19:04,000 Speaker 7: break into a session this year, benefit will be cutting 398 00:19:04,119 --> 00:19:07,200 Speaker 7: very very aggressively. So remember that the you know, the 399 00:19:07,520 --> 00:19:11,240 Speaker 7: market pricing is essentially the mean average weighted average of 400 00:19:11,320 --> 00:19:12,879 Speaker 7: those three different parts. 401 00:19:13,240 --> 00:19:15,879 Speaker 6: Krishna Kuhoe Evercoren, thank you so much as always for 402 00:19:15,960 --> 00:19:29,200 Speaker 6: joining us today. Joining us now, Jordan Rochester of Mizuho, Jordan. 403 00:19:29,359 --> 00:19:30,080 Speaker 1: Your first take on. 404 00:19:30,080 --> 00:19:33,000 Speaker 9: This, well, it's a dubbish outcome in terms of the 405 00:19:33,000 --> 00:19:36,240 Speaker 9: inflation forecast, a point three version for the next two years. 406 00:19:36,280 --> 00:19:38,280 Speaker 10: In terms of the numbers for twenty five and twenty six. 407 00:19:38,640 --> 00:19:40,840 Speaker 9: However, the elephant in the room is what's not in 408 00:19:40,880 --> 00:19:43,520 Speaker 9: this statement, which is their view on the impact of 409 00:19:43,560 --> 00:19:46,119 Speaker 9: trade Tarists will get that at two forty five. That 410 00:19:46,200 --> 00:19:48,679 Speaker 9: release that for us will be the scenario analysis. Do 411 00:19:48,720 --> 00:19:51,679 Speaker 9: they double the impact that they expect from taris? What 412 00:19:51,720 --> 00:19:53,600 Speaker 9: about the fifty percent from Donald Trump? So a lot 413 00:19:53,600 --> 00:19:55,280 Speaker 9: of this will have to come out in the press conference. 414 00:19:55,640 --> 00:19:58,160 Speaker 9: So far the moves are quite small though FX euro 415 00:19:58,280 --> 00:20:00,520 Speaker 9: slightly higher and in the front tend you only had 416 00:20:00,600 --> 00:20:04,080 Speaker 9: a two base two basis point rally, so nothing too big. 417 00:20:04,240 --> 00:20:06,080 Speaker 10: We wait to see what regards says later. 418 00:20:05,920 --> 00:20:08,199 Speaker 9: On and those forecasts and those scenarios that come out 419 00:20:08,280 --> 00:20:09,119 Speaker 9: late this afternoon. 420 00:20:09,320 --> 00:20:12,200 Speaker 5: Well some notice we have when it comes to trade 421 00:20:12,200 --> 00:20:14,399 Speaker 5: that the ECB statement says trade escalation would lead to 422 00:20:14,480 --> 00:20:17,440 Speaker 5: lower growth and inflation. Jordan, how do you start thinking 423 00:20:17,480 --> 00:20:20,760 Speaker 5: about if the European Union doesn't get a deal with 424 00:20:20,920 --> 00:20:22,480 Speaker 5: the US by July ninth? 425 00:20:23,320 --> 00:20:25,480 Speaker 9: And Marie, I think the EU is probably at the 426 00:20:25,520 --> 00:20:27,480 Speaker 9: bottom of the list in terms of the major partners 427 00:20:27,480 --> 00:20:30,600 Speaker 9: if you think about it, Japan, India, Vietnam. There's much 428 00:20:30,600 --> 00:20:33,800 Speaker 9: more focus on those negotiations when it comes to the EU. 429 00:20:33,960 --> 00:20:36,119 Speaker 9: There's a lot of lobbying to go hard on the 430 00:20:36,119 --> 00:20:38,919 Speaker 9: EU to reform some of the non tariff barriers they have, 431 00:20:39,080 --> 00:20:41,679 Speaker 9: such as the digital services tax with the US and 432 00:20:41,760 --> 00:20:44,960 Speaker 9: various other sort of non tariff measures. That's something that's 433 00:20:45,040 --> 00:20:47,959 Speaker 9: very difficult to agree to by July the ninth. So 434 00:20:48,080 --> 00:20:51,200 Speaker 9: what might happen is a stop gap, another delay Essentially, 435 00:20:51,359 --> 00:20:53,520 Speaker 9: that's the best that you could hope for. We saw 436 00:20:53,560 --> 00:20:56,040 Speaker 9: that when Trump ramped up the tariff to fifty percent, 437 00:20:56,320 --> 00:20:58,840 Speaker 9: we saw an immediate delay. Really, it happened within a 438 00:20:58,880 --> 00:21:01,240 Speaker 9: day or two to one phone call with Verst them 439 00:21:01,280 --> 00:21:03,440 Speaker 9: on the land. So I expect that the worst case 440 00:21:03,440 --> 00:21:05,600 Speaker 9: scenario is the taffs come in at the reciprocal levels, 441 00:21:05,640 --> 00:21:07,800 Speaker 9: which are around the twenty to twenty five percent level, 442 00:21:08,080 --> 00:21:10,960 Speaker 9: and the EU will be facing a summer of weaker 443 00:21:11,040 --> 00:21:12,840 Speaker 9: data as a result and a more dubbish ECB. 444 00:21:13,240 --> 00:21:15,560 Speaker 10: So we're looking for more rate cuts from the ECBs. 445 00:21:15,560 --> 00:21:16,560 Speaker 10: In the market's pricing. 446 00:21:16,720 --> 00:21:19,160 Speaker 9: We like receiving the front end for September, for example, 447 00:21:19,320 --> 00:21:21,320 Speaker 9: we expect rates to get down to one point five. 448 00:21:21,359 --> 00:21:23,320 Speaker 10: This market's pricing around one point seven. 449 00:21:23,640 --> 00:21:25,560 Speaker 9: Now, if there is a deal done, it's still going 450 00:21:25,600 --> 00:21:28,520 Speaker 9: to be a ten percent minimum, So it's we're picking 451 00:21:28,560 --> 00:21:30,960 Speaker 9: between bad and worse scenarios for the ECB. 452 00:21:31,200 --> 00:21:32,720 Speaker 5: Is there a scenario though, where you do think the 453 00:21:32,760 --> 00:21:34,880 Speaker 5: ECB goes on pause and this is. 454 00:21:34,800 --> 00:21:39,960 Speaker 9: A meeting, there is if you see PMIS continuously surprises. 455 00:21:40,000 --> 00:21:42,359 Speaker 9: If you have an upside surprise and the PMIS on 456 00:21:42,400 --> 00:21:44,639 Speaker 9: the next release. The difficult thing about that is the 457 00:21:44,680 --> 00:21:47,360 Speaker 9: PMI comes the morning of the ECB meeting, so it could. 458 00:21:47,200 --> 00:21:49,200 Speaker 10: Be really difficult to trade around that event. 459 00:21:49,400 --> 00:21:51,560 Speaker 9: It could be if you have strong CPI, but if 460 00:21:51,600 --> 00:21:53,439 Speaker 9: you look at the CPI data, we just had a 461 00:21:53,440 --> 00:21:56,800 Speaker 9: big downside surprise in services CPI and the curve in 462 00:21:56,880 --> 00:21:59,520 Speaker 9: terms of what the linker market is pricing has inflation 463 00:21:59,560 --> 00:22:01,120 Speaker 9: below two percent for the rest of the year. 464 00:22:01,320 --> 00:22:03,040 Speaker 10: So it's really hard to get a hawkish meeting. 465 00:22:03,080 --> 00:22:04,760 Speaker 9: But a Marie, I've got to be honest, some of 466 00:22:04,760 --> 00:22:07,000 Speaker 9: the ECB hawks really have surprised me with their comments 467 00:22:07,000 --> 00:22:08,520 Speaker 9: suggesting we should have a slower pace. 468 00:22:09,240 --> 00:22:11,120 Speaker 10: They are the hawks, so hawks have to be hawkish. 469 00:22:11,560 --> 00:22:14,520 Speaker 9: I think the core unit of the ECB and overall 470 00:22:14,520 --> 00:22:16,399 Speaker 9: still vote for a rate cut in July and not 471 00:22:16,560 --> 00:22:18,960 Speaker 9: enough priced. But we need to see how this press 472 00:22:18,960 --> 00:22:19,600 Speaker 9: conference goes. 473 00:22:20,440 --> 00:22:23,840 Speaker 11: Hi Jordan, I understood that there's a lot of attention 474 00:22:24,119 --> 00:22:27,880 Speaker 11: to the upside risk of inflation coming from care policy, 475 00:22:27,920 --> 00:22:30,359 Speaker 11: but I want to ask a question in the opposite direction. 476 00:22:30,920 --> 00:22:35,119 Speaker 11: If inflation in the EU continues to undershoot the ECB's 477 00:22:35,160 --> 00:22:38,320 Speaker 11: two percent target. Is there a risk that real interest 478 00:22:38,359 --> 00:22:42,000 Speaker 11: rates actually turn closer to that zero bound or even 479 00:22:42,119 --> 00:22:44,159 Speaker 11: negative in the next two or three years. 480 00:22:44,720 --> 00:22:46,840 Speaker 9: I don't think the risk of that is too high, actually, 481 00:22:46,840 --> 00:22:49,919 Speaker 9: because what we're seeing is inflation is coming down. The 482 00:22:49,920 --> 00:22:52,280 Speaker 9: eastb's forecast today have it below two percent for the 483 00:22:52,280 --> 00:22:55,199 Speaker 9: next two years. Really, when it comes to the real 484 00:22:55,280 --> 00:22:57,160 Speaker 9: yield you got to think about the nominal side as well. 485 00:22:57,440 --> 00:22:59,560 Speaker 10: So we're dubbish on the ECB in the short term. 486 00:22:59,600 --> 00:23:02,320 Speaker 9: But actually, kind of linking to the question Amory mentioned, 487 00:23:02,440 --> 00:23:04,840 Speaker 9: the German fiscal stimulus will make it difficult for real 488 00:23:04,880 --> 00:23:07,320 Speaker 9: yields to be materially weak, because what we're going to 489 00:23:07,320 --> 00:23:09,679 Speaker 9: see in Q four is the budget is passed in 490 00:23:09,720 --> 00:23:12,080 Speaker 9: Germany and will have much larger amounts of issuance in 491 00:23:12,119 --> 00:23:14,639 Speaker 9: twenty twenty six. The hawks of the ECB might be 492 00:23:14,680 --> 00:23:16,640 Speaker 9: able to hang on to that, but that is over 493 00:23:16,720 --> 00:23:19,399 Speaker 9: six months away and quite difficult for this market to 494 00:23:19,440 --> 00:23:20,560 Speaker 9: trade every single day. 495 00:23:20,720 --> 00:23:22,520 Speaker 10: But that for the long term, I find it. 496 00:23:22,520 --> 00:23:25,480 Speaker 9: Very difficult to see real yields and performing in Europe 497 00:23:25,520 --> 00:23:28,280 Speaker 9: because of higher nominal yields. I expect to see with 498 00:23:28,359 --> 00:23:30,600 Speaker 9: the German tenure bun getting to three point three percent. 499 00:23:31,040 --> 00:23:34,960 Speaker 11: How much of a sea change A game changer is 500 00:23:35,080 --> 00:23:36,920 Speaker 11: German issuance for the ECV. 501 00:23:37,960 --> 00:23:40,920 Speaker 9: It's a massive game change. We've had many years where 502 00:23:41,480 --> 00:23:44,360 Speaker 9: the weak growth in Europe was underpinned by the lack 503 00:23:44,400 --> 00:23:46,480 Speaker 9: of or the fiscal austerity we saw in Germany for 504 00:23:46,480 --> 00:23:49,200 Speaker 9: the past two decades. Roughly speaking, compared to what others 505 00:23:49,240 --> 00:23:51,760 Speaker 9: should have done, the Germans have a lot of fiscal 506 00:23:51,800 --> 00:23:54,240 Speaker 9: firepower debt to GDP in the sixty percent level sort 507 00:23:54,240 --> 00:23:58,200 Speaker 9: of range, and the infrastructure alone that package is five 508 00:23:58,280 --> 00:24:00,720 Speaker 9: hundred billion euros over ten years, so that's at least 509 00:24:00,720 --> 00:24:02,959 Speaker 9: one percent to one point two five percent of GDP 510 00:24:03,240 --> 00:24:05,280 Speaker 9: from next year onwards. We don't yet know what the 511 00:24:05,359 --> 00:24:07,159 Speaker 9: numbers will be on the fence. We don't yet know 512 00:24:07,280 --> 00:24:09,000 Speaker 9: the numbers. We've got a sense of what it will 513 00:24:09,000 --> 00:24:10,960 Speaker 9: be on tax cuts. We had the forty two billion 514 00:24:11,000 --> 00:24:13,679 Speaker 9: to forty seven billion from the headlines this week for 515 00:24:13,720 --> 00:24:16,879 Speaker 9: corporation tax cuts, so the numbers will be large. Generally 516 00:24:16,880 --> 00:24:19,199 Speaker 9: starts from a very strong position and that's why you're 517 00:24:19,240 --> 00:24:20,960 Speaker 9: going to see the fiscal five power matter quite a 518 00:24:21,000 --> 00:24:21,600 Speaker 9: lot next year. 519 00:24:21,720 --> 00:24:24,159 Speaker 6: It's a great question Joan that Neil is raising at 520 00:24:24,160 --> 00:24:27,560 Speaker 6: a time when potentially the ECB is looking at sub 521 00:24:27,760 --> 00:24:32,280 Speaker 6: par inflation, inflation below that two percent level. How inflationary 522 00:24:32,400 --> 00:24:36,120 Speaker 6: are some of these fiscal packages that Germany has floated. 523 00:24:36,800 --> 00:24:39,040 Speaker 9: Well, it depends on if you're going with tax cuts, 524 00:24:39,040 --> 00:24:42,600 Speaker 9: that's immediately more inflationary. Then it comes to infrastructure spending, 525 00:24:43,080 --> 00:24:44,920 Speaker 9: So we have to know the sizes of these numbers. 526 00:24:45,160 --> 00:24:47,000 Speaker 9: So if the tax cuts we've taken, let's say it's 527 00:24:47,000 --> 00:24:50,800 Speaker 9: fifty billion, that's pretty sizeable number for that or that 528 00:24:50,800 --> 00:24:52,800 Speaker 9: that's something that will have to be reflected in their forecast. 529 00:24:52,920 --> 00:24:54,280 Speaker 10: But it is just a German number. 530 00:24:54,280 --> 00:24:55,920 Speaker 9: And you've also got the problem with the rest of 531 00:24:55,920 --> 00:24:58,399 Speaker 9: the Eurozone is you don't have the same fiscal fire powers. 532 00:24:58,400 --> 00:25:01,560 Speaker 9: The ECB can't get too optim mystic from Germany alone. 533 00:25:01,680 --> 00:25:04,440 Speaker 9: You have France which is fiscally constrained. You've got Italy 534 00:25:04,520 --> 00:25:06,919 Speaker 9: and Spain not really able to move the needle on 535 00:25:07,040 --> 00:25:10,200 Speaker 9: things either. But then when it comes to the infrastructure 536 00:25:10,200 --> 00:25:12,879 Speaker 9: spending from Germany, that is a big positive that markets like, 537 00:25:13,000 --> 00:25:16,159 Speaker 9: improves productivity and expected growth, but it won't translate to 538 00:25:16,280 --> 00:25:19,560 Speaker 9: high inflation on day one because building bridges and so forth. 539 00:25:19,680 --> 00:25:22,200 Speaker 9: It will boost commodity prices, and it'll raise the price 540 00:25:22,240 --> 00:25:24,600 Speaker 9: of building services, but it won't affect everything else in 541 00:25:24,640 --> 00:25:25,120 Speaker 9: the main. 542 00:25:25,359 --> 00:25:26,600 Speaker 1: Jordan Rochester with a zoo. 543 00:25:26,640 --> 00:25:38,240 Speaker 6: Thank you so much as always for the insights. Joining 544 00:25:38,320 --> 00:25:40,919 Speaker 6: us now, Christna Mamani of La fay At College, Krishna, 545 00:25:41,119 --> 00:25:42,320 Speaker 6: thank you so much for being here. 546 00:25:42,359 --> 00:25:43,000 Speaker 1: Great to see you. 547 00:25:43,520 --> 00:25:46,280 Speaker 6: How do you use data like this that isn't bad 548 00:25:46,400 --> 00:25:48,880 Speaker 6: enough to cause the Fed to make a move, isn't 549 00:25:48,920 --> 00:25:51,560 Speaker 6: good enough to give you confidence. It just sort of 550 00:25:52,160 --> 00:25:54,720 Speaker 6: is sort of maybe a trend that we maybe can ignore, 551 00:25:54,800 --> 00:25:56,160 Speaker 6: maybe need to pay attention. 552 00:25:55,880 --> 00:25:58,560 Speaker 12: To well, so if we ignore it, we ignore it 553 00:25:58,560 --> 00:26:02,080 Speaker 12: at our peril. That is, I think the economy has 554 00:26:02,119 --> 00:26:05,760 Speaker 12: wall or I think rightly articulated the economy is slowing. 555 00:26:06,200 --> 00:26:08,800 Speaker 12: It's not slowing at the precipitous pace, but it is 556 00:26:08,840 --> 00:26:11,440 Speaker 12: definitely slowing. And you can see that it used to 557 00:26:11,480 --> 00:26:14,360 Speaker 12: be in the soft data. Now the soft data improved, 558 00:26:14,400 --> 00:26:17,800 Speaker 12: but the hard data is softening. So I think there 559 00:26:17,920 --> 00:26:21,840 Speaker 12: is a substantial trend for slowing in the economy. It's 560 00:26:21,960 --> 00:26:25,439 Speaker 12: again not precipitous, but gives the FED the path to 561 00:26:25,520 --> 00:26:28,119 Speaker 12: cut rates, not today but in the later half of 562 00:26:28,160 --> 00:26:28,440 Speaker 12: the year. 563 00:26:29,720 --> 00:26:33,359 Speaker 11: In your opinion, what would it take to see that cut. 564 00:26:33,400 --> 00:26:36,160 Speaker 11: What would it take in terms of whether it's jobless 565 00:26:36,160 --> 00:26:39,399 Speaker 11: claims or continuing claims, or the unemployment. 566 00:26:38,840 --> 00:26:40,160 Speaker 1: Rate, the mix of it all. 567 00:26:40,480 --> 00:26:43,720 Speaker 11: How dire does the labor market data have to be 568 00:26:44,520 --> 00:26:47,959 Speaker 11: to challenge the fact that the economy is fine and 569 00:26:48,000 --> 00:26:49,280 Speaker 11: can continue to grow. 570 00:26:49,760 --> 00:26:51,880 Speaker 12: I think the FED on that count has kind of 571 00:26:52,359 --> 00:26:55,720 Speaker 12: been very clear. That is, at the end of the day, 572 00:26:55,800 --> 00:26:58,479 Speaker 12: what they're focused on for cutting rates is really the 573 00:26:58,520 --> 00:27:04,879 Speaker 12: employment picture. If the employment picture deteriorates meaningfully, not one month, 574 00:27:05,080 --> 00:27:09,320 Speaker 12: but on a couple of months in sequence, I think 575 00:27:09,359 --> 00:27:12,159 Speaker 12: that's what gets them there. Again, I think even if 576 00:27:12,200 --> 00:27:15,040 Speaker 12: we get a soft employment report tomorrow. 577 00:27:14,960 --> 00:27:16,320 Speaker 10: That is just not enough. 578 00:27:16,920 --> 00:27:20,520 Speaker 12: However, if we see that in the third quarter and 579 00:27:20,560 --> 00:27:23,360 Speaker 12: on a consistent basis, I think they have the pathway 580 00:27:23,400 --> 00:27:23,920 Speaker 12: to cut. 581 00:27:23,760 --> 00:27:26,679 Speaker 5: Rates, even a data dependent FED that keeps saying that 582 00:27:26,720 --> 00:27:29,879 Speaker 5: they need certainty and they're very unclear at the moment 583 00:27:30,240 --> 00:27:32,280 Speaker 5: where trade policy might mean for inflation. 584 00:27:32,960 --> 00:27:36,280 Speaker 12: Well, so, I think from the FEDS perspective, the tariff 585 00:27:37,040 --> 00:27:39,920 Speaker 12: is really a wild card because they don't know, they 586 00:27:39,920 --> 00:27:42,879 Speaker 12: don't have enough of an empirical framework to kind of 587 00:27:43,080 --> 00:27:45,600 Speaker 12: figure that out. And for that they will wait. On 588 00:27:45,640 --> 00:27:49,560 Speaker 12: the other hand, if simultaneously, if the markets, if the 589 00:27:49,560 --> 00:27:54,000 Speaker 12: employment markets are deteriorating quite substantially, I think they have 590 00:27:54,040 --> 00:27:56,919 Speaker 12: the headroom in terms of where policy rates are today 591 00:27:57,119 --> 00:27:59,480 Speaker 12: relative to where inflation is, for them to be able 592 00:27:59,520 --> 00:28:02,600 Speaker 12: to cut on a proactive basis as opposed to just 593 00:28:02,800 --> 00:28:03,879 Speaker 12: on a reactive basis. 594 00:28:03,960 --> 00:28:06,560 Speaker 5: Falling up on Neilla's point quite substantially. What is that 595 00:28:06,600 --> 00:28:09,960 Speaker 5: four point five percent unemployment in the sand? 596 00:28:10,680 --> 00:28:13,960 Speaker 12: I don't think it's the unemployment number itself, it's really 597 00:28:14,000 --> 00:28:18,120 Speaker 12: the trend in employment growth that on a consistent basis 598 00:28:18,160 --> 00:28:22,440 Speaker 12: several months comes in significantly lower than what the trend 599 00:28:22,520 --> 00:28:23,720 Speaker 12: rate has been so last. 600 00:28:23,640 --> 00:28:25,800 Speaker 1: Year when they got exactly. 601 00:28:25,840 --> 00:28:27,920 Speaker 6: But it raises a question about how much it would matter, 602 00:28:28,000 --> 00:28:31,280 Speaker 6: right how much we're kind of talking about the wrong issue. 603 00:28:31,520 --> 00:28:33,600 Speaker 6: Is the issue really how much will take the FED 604 00:28:33,600 --> 00:28:34,040 Speaker 6: to cut? 605 00:28:34,240 --> 00:28:36,439 Speaker 1: Or is the issue? Are we slowing or are we 606 00:28:36,480 --> 00:28:37,160 Speaker 1: stalling out? 607 00:28:37,200 --> 00:28:39,160 Speaker 6: And I think that that's the bigger question, maybe for 608 00:28:39,240 --> 00:28:41,520 Speaker 6: both bond markets and for the FED. It's not just 609 00:28:41,920 --> 00:28:44,280 Speaker 6: do you have to adjust things on the margins, it's 610 00:28:44,400 --> 00:28:47,560 Speaker 6: longer term how much heat is left in an economy 611 00:28:47,800 --> 00:28:49,480 Speaker 6: that has a lot of question marks around it. 612 00:28:49,640 --> 00:28:52,600 Speaker 12: Well, that's a really good observation in the sense that 613 00:28:52,760 --> 00:28:55,960 Speaker 12: even if the FED cuts let's say in the third 614 00:28:56,040 --> 00:28:59,640 Speaker 12: quarter or early part of fourth quarter this year, the 615 00:28:59,760 --> 00:29:03,360 Speaker 12: light impact of that on the markets, at least equity 616 00:29:03,400 --> 00:29:06,760 Speaker 12: markets is probably not going to be as positive as 617 00:29:06,800 --> 00:29:09,280 Speaker 12: people are expecting it to be, because I think in 618 00:29:10,120 --> 00:29:13,520 Speaker 12: the throes of a tariff situation, if they are cutting rates, 619 00:29:13,560 --> 00:29:16,479 Speaker 12: then they are really really worried that's bad news that 620 00:29:16,560 --> 00:29:18,880 Speaker 12: will end up being bad news for the equity market. 621 00:29:18,960 --> 00:29:21,520 Speaker 12: So that's why I think equity markets at this point 622 00:29:21,720 --> 00:29:26,000 Speaker 12: the only upside is really going to come from productivity growth, 623 00:29:26,000 --> 00:29:28,600 Speaker 12: earnings growth, things like that, and that is not looking 624 00:29:28,680 --> 00:29:29,680 Speaker 12: very likely at the moment. 625 00:29:29,960 --> 00:29:32,680 Speaker 11: I want to follow up on Matt Steven and Lisa's question, 626 00:29:32,760 --> 00:29:35,240 Speaker 11: and I realize we're asking you to pingpong between the 627 00:29:35,280 --> 00:29:39,080 Speaker 11: real economy and the markets right now, But what are 628 00:29:39,120 --> 00:29:41,920 Speaker 11: the growth drivers that you see in the second half 629 00:29:41,920 --> 00:29:45,239 Speaker 11: of the year that really catapults the economy for that 630 00:29:45,400 --> 00:29:49,080 Speaker 11: raises those productivity numbers. Is there something that we're waiting 631 00:29:49,160 --> 00:29:51,880 Speaker 11: for to happen that could really trigger that growth. 632 00:29:52,480 --> 00:29:55,600 Speaker 12: I don't think there's really anything substantial in the pipeline 633 00:29:55,640 --> 00:29:59,480 Speaker 12: that can get you there. I think the fiscal impetus, 634 00:29:59,520 --> 00:30:01,880 Speaker 12: that is, but fiscal impulse that has been in the 635 00:30:01,880 --> 00:30:05,160 Speaker 12: place because of deficit financing, is really what is carrying 636 00:30:05,200 --> 00:30:11,360 Speaker 12: us through. In that mix, tariffs are basically a contractionary policy, 637 00:30:11,400 --> 00:30:14,040 Speaker 12: so I think we are trying to balance. There's really 638 00:30:14,120 --> 00:30:18,920 Speaker 12: no stimulus, significant stimulus coming into the economy until the 639 00:30:19,040 --> 00:30:22,320 Speaker 12: tax package passes, and then we see the implications of 640 00:30:22,360 --> 00:30:24,720 Speaker 12: that in terms of further deficit increase. 641 00:30:24,960 --> 00:30:27,600 Speaker 6: Michael McKee is still with us and he's been parsing 642 00:30:27,600 --> 00:30:29,960 Speaker 6: through the data. Mike, in addition to a job, was 643 00:30:30,040 --> 00:30:32,040 Speaker 6: claimed some really interesting trade data. 644 00:30:32,040 --> 00:30:33,479 Speaker 1: As you pass through it, what are you seeing? 645 00:30:33,880 --> 00:30:35,840 Speaker 13: Well, basically what we saw these it was a pull 646 00:30:35,880 --> 00:30:39,480 Speaker 13: forward in imports. Imports dropped by sixteen point three percent, 647 00:30:40,040 --> 00:30:42,880 Speaker 13: and that pushed the overall trade deficit down by fifty 648 00:30:42,920 --> 00:30:45,560 Speaker 13: five and a half percent, and the Census Buro says 649 00:30:45,600 --> 00:30:48,800 Speaker 13: those are the two largest declines in those categories ever. 650 00:30:49,360 --> 00:30:52,320 Speaker 13: Now it's all statistical noise in the sense that we 651 00:30:52,400 --> 00:30:55,520 Speaker 13: didn't make a big deal out of the rise in 652 00:30:55,560 --> 00:30:58,880 Speaker 13: the trade balance in January February because we knew it 653 00:30:58,920 --> 00:31:01,160 Speaker 13: was the pull forward of sorts. But it does have 654 00:31:01,240 --> 00:31:03,320 Speaker 13: an effect on the overall data. We'll see a bigger 655 00:31:03,440 --> 00:31:06,960 Speaker 13: rise in second quarter growth. Then we saw the big 656 00:31:07,000 --> 00:31:09,960 Speaker 13: fall of course in first quarter growth. And the one 657 00:31:09,960 --> 00:31:12,480 Speaker 13: thing to point out about jobless claims is this is 658 00:31:12,520 --> 00:31:16,720 Speaker 13: the biggest jump, or the highest level rather in eight months, 659 00:31:17,040 --> 00:31:20,160 Speaker 13: and it's the highest two week in a row level 660 00:31:20,480 --> 00:31:22,920 Speaker 13: in more than a year, So we do see some 661 00:31:22,960 --> 00:31:26,840 Speaker 13: weakness here. Neil Dna writing in that you have about 662 00:31:26,840 --> 00:31:29,640 Speaker 13: a two hundred and sixty thousand level would be the 663 00:31:29,720 --> 00:31:32,120 Speaker 13: break even for jobless claims, and if we get above that, 664 00:31:32,120 --> 00:31:33,760 Speaker 13: we're going to see week payroll numbers. 665 00:31:33,960 --> 00:31:34,920 Speaker 1: So we'll see what. 666 00:31:34,800 --> 00:31:37,920 Speaker 13: We get tomorrow. But of course we're starting to see 667 00:31:37,920 --> 00:31:40,160 Speaker 13: the numbers come in Procter and Gamble today saying it's 668 00:31:40,200 --> 00:31:43,080 Speaker 13: going to lay off seven thousand people. So it's starting 669 00:31:43,080 --> 00:31:44,120 Speaker 13: to weaken out there. 670 00:31:44,320 --> 00:31:46,440 Speaker 6: Mike, before you go, just a quick note, how much 671 00:31:46,440 --> 00:31:48,560 Speaker 6: are you getting people questioning the integrity of some of 672 00:31:48,600 --> 00:31:51,080 Speaker 6: this data, as we got reports yesterday from the Bureau 673 00:31:51,080 --> 00:31:54,480 Speaker 6: of Labor Statistics that they didn't collect data for CPI 674 00:31:54,600 --> 00:31:57,240 Speaker 6: in certain regions in April due to budget cuts. 675 00:31:57,800 --> 00:32:01,280 Speaker 13: CPI is the one that's being affected most and first, 676 00:32:01,400 --> 00:32:05,200 Speaker 13: but there are also concerns about the labor data as well. 677 00:32:05,240 --> 00:32:08,480 Speaker 13: What's happening is the government has cut funding and not 678 00:32:08,600 --> 00:32:10,760 Speaker 13: kept up funding for years, and then we have the 679 00:32:10,800 --> 00:32:14,000 Speaker 13: DOGE cuts, so they're behind the eight ball. They can't 680 00:32:14,040 --> 00:32:16,760 Speaker 13: really collect all the data that they have. Now, the 681 00:32:16,840 --> 00:32:19,960 Speaker 13: data that they do collect is going to be used 682 00:32:20,000 --> 00:32:23,120 Speaker 13: as well as it possibly can be, but just because 683 00:32:23,160 --> 00:32:25,520 Speaker 13: you have fewer people collecting it and less data, you're 684 00:32:25,520 --> 00:32:27,360 Speaker 13: going to have a wider margin of error. 685 00:32:27,440 --> 00:32:31,000 Speaker 6: Michael mckae, thank you so much, Krishna. What exactly do 686 00:32:31,040 --> 00:32:33,240 Speaker 6: you do with this the idea that the granular data 687 00:32:33,320 --> 00:32:37,040 Speaker 6: shows some degree of weakening, and yet there's a question 688 00:32:37,080 --> 00:32:39,720 Speaker 6: about just how accurate it is on any given week. 689 00:32:40,000 --> 00:32:42,920 Speaker 12: Well, so it's kind of a sad state of affairs 690 00:32:43,080 --> 00:32:48,040 Speaker 12: that the best statistical data collecting agency in the world 691 00:32:48,080 --> 00:32:50,400 Speaker 12: is struggling to kind of do the surveys that we 692 00:32:50,720 --> 00:32:52,800 Speaker 12: desperately need at this time of transition. 693 00:32:52,920 --> 00:32:54,959 Speaker 4: But it is what it is. 694 00:32:55,560 --> 00:32:59,640 Speaker 12: However, I think they do enough data collection for it 695 00:32:59,760 --> 00:33:03,880 Speaker 12: not to be kind of disturbed in a significant way, 696 00:33:03,920 --> 00:33:06,240 Speaker 12: and you can probably derive the basic trends out of 697 00:33:06,280 --> 00:33:09,480 Speaker 12: the data that they're collecting. But I think again I 698 00:33:09,520 --> 00:33:13,320 Speaker 12: would reatterate my point. It's a very sad state of affairs. 699 00:33:13,600 --> 00:33:15,800 Speaker 5: But does the data even matter when the policy is 700 00:33:15,880 --> 00:33:16,920 Speaker 5: changing so quickly? 701 00:33:17,720 --> 00:33:20,760 Speaker 12: Well, so data does matter, because how would you expect 702 00:33:20,800 --> 00:33:24,040 Speaker 12: the policy maker whose one mandate is employment to kind 703 00:33:24,080 --> 00:33:26,360 Speaker 12: of react to it if they don't have accurate data 704 00:33:26,440 --> 00:33:30,320 Speaker 12: and a really clear clear picture of what the impact 705 00:33:30,400 --> 00:33:33,600 Speaker 12: of the various policies are on the economy. Without that, 706 00:33:33,640 --> 00:33:36,520 Speaker 12: we are kind of we are blind, and that would 707 00:33:36,560 --> 00:33:38,320 Speaker 12: be a terrible state of affairs. 708 00:33:38,360 --> 00:33:40,160 Speaker 5: I mean, most of the market's not the real economy. 709 00:33:40,200 --> 00:33:42,960 Speaker 12: It is just so I think to some extent, markets 710 00:33:43,000 --> 00:33:46,920 Speaker 12: do react to policy, and for the policy to be 711 00:33:46,920 --> 00:33:49,880 Speaker 12: commensurate with the state of the economy, we need that data. 712 00:33:50,040 --> 00:33:52,680 Speaker 6: Christian Momoni of La Fair College don't be a stranger. 713 00:33:52,720 --> 00:33:54,440 Speaker 1: Great to see you. Thank you so much for being here. 714 00:33:55,120 --> 00:33:58,680 Speaker 2: This is the Bloomberg Seventans podcast, bringing you the best 715 00:33:58,720 --> 00:34:02,040 Speaker 2: in markets, economics, angiot politics. You can watch the show 716 00:34:02,080 --> 00:34:05,040 Speaker 2: live on Bloomberg TV weekday mornings from six am to 717 00:34:05,160 --> 00:34:08,920 Speaker 2: nine am Eastern. Subscribe to the podcast on Apple, Spotify 718 00:34:09,080 --> 00:34:11,279 Speaker 2: or anywhere else you listen, and as always on the 719 00:34:11,320 --> 00:34:13,759 Speaker 2: Bloomberg Terminal and the Bloomberg Business app.