WEBVTT - Fed Outlook and a Potential Harris-Trump Debate 0:00:00.080 --> 0:00:06.760 Bloomberg Audio Studios, Podcasts, radio news. 0:00:11.960 --> 0:00:15.560 This is the Bloomberg Surveillance Podcast. I'm Tom Keene along 0:00:15.600 --> 0:00:18.960 with Paul Sweeney. Join us each day for insight from 0:00:18.960 --> 0:00:23.119 the best in economics, finance, investment, and international relations. You 0:00:23.160 --> 0:00:26.520 can also watch the show live on YouTube. Visit the 0:00:26.520 --> 0:00:31.280 Bloomberg Podcast channel on YouTube to see the show weekday 0:00:31.280 --> 0:00:34.320 mornings from seven to ten am Eastern from our global 0:00:34.360 --> 0:00:39.000 headquarters in New York City. Subscribe to the podcast on Apple, Spotify, 0:00:39.360 --> 0:00:42.920 or anywhere else you listen and always I'm Bloomberg Radio, 0:00:43.080 --> 0:00:46.720 the Bloomberg Terminal, and the Bloomberg Business App. I'm not 0:00:46.800 --> 0:00:49.320 so much in the camp of a certitude of a 0:00:49.360 --> 0:00:53.200 September a rate Let's get wisdom on that with Nationwide 0:00:53.200 --> 0:00:56.400 with a wonderful Ohio perspective. Kathleen bus Johnson joins US 0:00:56.440 --> 0:01:01.320 now Chief Economists Nationwide because she's on our side. Kathy, 0:01:01.400 --> 0:01:04.440 I look at where we are right now, and more 0:01:04.480 --> 0:01:06.880 than anything, I would say there's a certitude about a 0:01:06.959 --> 0:01:09.800 September rate cut. Why do we feel that way? 0:01:11.000 --> 0:01:15.680 God, Good morning, Tom. Well the inflation data have you know, namely, 0:01:16.319 --> 0:01:20.720 really cooled off significantly. It makes it seem as if 0:01:20.959 --> 0:01:23.160 that the flare up we saw on the first quarter 0:01:23.400 --> 0:01:28.000 was anomalous and that really inflation is back on a 0:01:28.000 --> 0:01:30.520 good trend, you know, and eventually get back to two 0:01:30.600 --> 0:01:35.679 percent case. And we've also seen some slowing or moderation 0:01:36.080 --> 0:01:41.760 in employment and other key economic readings that you know, 0:01:41.800 --> 0:01:43.959 as a FED was there says they're more balanced right 0:01:44.000 --> 0:01:47.680 between the risks with inflation and employment, so it kind 0:01:47.680 --> 0:01:49.440 of gives them the green light and the reasons to 0:01:49.480 --> 0:01:50.400 start to cut rates. 0:01:50.480 --> 0:01:52.440 Where are you on jab as claims when you say 0:01:52.440 --> 0:01:54.640 that the labor market is breaking? I got a four 0:01:54.680 --> 0:01:57.800 week moving average of the weekly data of two hundred 0:01:57.840 --> 0:02:00.840 and thirty five thousand. It's buttressed right up against a 0:02:00.880 --> 0:02:04.040 peak of twenty twenty three of about two hundred and 0:02:04.120 --> 0:02:07.840 fifty one thousand. What's the statistic in your head where 0:02:07.920 --> 0:02:09.399 jobless claim signals? 0:02:09.520 --> 0:02:14.040 Let's go, yeah, so that you know, we've seen some 0:02:14.200 --> 0:02:18.480 upward movement and jobless claims, but that's still quite low. 0:02:19.600 --> 0:02:22.520 And I'm not suggesting or worry that we're about to 0:02:22.520 --> 0:02:25.359 see a big roll over in the labor market. It's 0:02:25.360 --> 0:02:28.160 not as if we're going to start seeing negative payroll 0:02:28.200 --> 0:02:31.760 prints or the unemployment rate jumping sharply higher. But as 0:02:31.800 --> 0:02:34.480 we creep higher, that's sick news. 0:02:34.480 --> 0:02:35.040 Some slowing. 0:02:35.080 --> 0:02:38.200 And you know, one statistic that I would say on payrolls, 0:02:38.200 --> 0:02:41.320 besides all the other ones that will watch, is in 0:02:41.360 --> 0:02:45.160 the household servey those who've been unemployed twenty six weeks 0:02:45.280 --> 0:02:47.480 or longer. Interesting thing to see that pick up. 0:02:48.080 --> 0:02:50.040 Gen know, that used to be the first statistic I 0:02:50.040 --> 0:02:53.880 looked at back when we were eight nine, ten percent unemployment. 0:02:54.000 --> 0:02:56.440 If that's If that's the case, Kathy, let me frame 0:02:56.520 --> 0:03:00.120 this out as a dual mandate. The laureate Krugman over 0:03:00.200 --> 0:03:02.720 at the New York Times has a tweet out yesterday 0:03:03.440 --> 0:03:07.080 on this disinflation, and he says, now, now, now is 0:03:07.120 --> 0:03:09.600 what he wants your own pole to do. I've got 0:03:09.639 --> 0:03:14.480 a market economist plural maybe led by over at Steefel 0:03:16.360 --> 0:03:20.760 the Lindsay Piagsa saying okay, maybe, but we need jobs 0:03:20.800 --> 0:03:24.640 to finally collapse. I don't see jobs collapsing. And I 0:03:24.680 --> 0:03:27.679 believe you just said edbing is more like what the 0:03:27.760 --> 0:03:29.440 labor economy will do. 0:03:30.680 --> 0:03:34.839 Yeah, that's right. I have sympathy for those who said 0:03:34.840 --> 0:03:37.920 the face should consider cutting rates, you know tomorrow right, 0:03:37.960 --> 0:03:40.880 getting the announcement, but they're not. They're not going to. 0:03:40.920 --> 0:03:43.200 They haven't signaled that, and I do think they want 0:03:43.240 --> 0:03:46.960 to see more data, particularly to be really convinced that 0:03:47.000 --> 0:03:49.960 the Q one inflation data ship they're corobinists. But yeah, 0:03:50.040 --> 0:03:53.000 back to the labor market moderation. Now, what we don't 0:03:53.040 --> 0:03:56.400 know is this moderation a harbinger of something you know, 0:03:56.520 --> 0:03:58.920 more dramatic as we go into twenty twenty five. We 0:03:59.000 --> 0:04:01.560 just don't know yet as if had been too late 0:04:01.640 --> 0:04:03.560 to cut rates starting in to cut rates again, we 0:04:03.600 --> 0:04:05.800 don't know. But right now, I would say, in the 0:04:05.800 --> 0:04:08.360 New York time, there's no signs of labor markets collapsing. 0:04:08.400 --> 0:04:11.080 Hey, Kathy, give me an idea. Just how restrictive are 0:04:11.160 --> 0:04:12.720 we at this point? 0:04:13.720 --> 0:04:17.200 Well, we're restricted when you look at certain pockets of 0:04:17.240 --> 0:04:20.240 the economy. Right, So, housing we know has been paralyzed 0:04:20.320 --> 0:04:23.480 for you know, for months, right well over a year. 0:04:24.440 --> 0:04:26.920 People are locked into low mortgages, aren't even putting their 0:04:26.920 --> 0:04:29.640 homes up for sale or moving. Housing starts are still 0:04:29.680 --> 0:04:33.520 really low. And then we know the lower income households 0:04:33.560 --> 0:04:37.000 are really facing headwinds that they're increasingly maxed out on 0:04:37.040 --> 0:04:39.120 their credit card. The New York Fed data shows us 0:04:39.160 --> 0:04:43.640 a fully fed data shows us that they're delinquent. And 0:04:43.800 --> 0:04:46.280 even though inflation is cooled, as we all know, price 0:04:46.360 --> 0:04:49.320 levels are still high relative to pre pandemic, So they're 0:04:49.360 --> 0:04:53.000 feeling the pressure there. I think that and the pandemic 0:04:53.040 --> 0:04:55.320 savings are topped out, So we have to remember that 0:04:55.880 --> 0:04:59.280 the tail was that god ess as resilient economy are 0:04:59.279 --> 0:05:01.880 really fading and the headwinds are still there and maybe 0:05:01.880 --> 0:05:03.040 even get a little stronger. 0:05:03.120 --> 0:05:05.680 And that other part of the dual mandate with employment. 0:05:05.680 --> 0:05:11.719 When employment goes, what does it take with it consumer spending? Obviously, right, Yeah. 0:05:11.440 --> 0:05:17.720 That's rights. As employment slows, aggregate income declines, and then 0:05:17.960 --> 0:05:22.200 that starts to restrain consumer spending. And the consumers don't 0:05:22.240 --> 0:05:24.160 have that, you know, they can't really, they don't have 0:05:24.200 --> 0:05:27.080 a lot of savings to rely on. If income starts 0:05:27.040 --> 0:05:29.520 as slow, you've got an unemployment a savings rate that's 0:05:29.560 --> 0:05:33.240 three point four mark that against pre pandemic savings rate 0:05:33.240 --> 0:05:37.479 which was seven point seven. And we also know again 0:05:37.800 --> 0:05:40.440 that you're starting to see delinquencies when the unemployment rate's 0:05:40.480 --> 0:05:44.600 only four point one, delinquencies on credit card and loan payments. 0:05:45.000 --> 0:05:47.200 What will that look like if we do start to 0:05:47.240 --> 0:05:49.520 see some deeper cracks in the labor market. 0:05:49.680 --> 0:05:52.919 Kathy, Thank you so much, Kathleen in Wes johnsick the nationwide. 0:05:52.960 --> 0:06:13.800 You get us started towards a FED day. 0:06:05.200 --> 0:06:05.680 Joining us. 0:06:05.720 --> 0:06:08.640 Now he's been a huge value to us. Terry Haynes 0:06:08.640 --> 0:06:13.400 at PENGEEA Policy here on the next step forward, I 0:06:13.480 --> 0:06:17.560 get a plan of exhilarance, exuberants, Terry Haynes from Harris. 0:06:18.240 --> 0:06:20.159 What's the plan from the Trump camp? 0:06:21.560 --> 0:06:23.919 The plan from the Trump campaign Tom is basically to 0:06:23.960 --> 0:06:27.560 try to define Harris before she can define herself effectively. 0:06:28.000 --> 0:06:30.440 They see a window of about three weeks before the 0:06:30.520 --> 0:06:35.120 convention where they can present Harris not only kind of 0:06:35.160 --> 0:06:39.960 the word salad that everybody knows about, but also defining 0:06:40.000 --> 0:06:42.400 I forget what Trump's exact words are, but you know 0:06:42.440 --> 0:06:45.160 it's extreme, most liberal ever, you know. So on and 0:06:45.160 --> 0:06:50.400 so forth, in an attempt, frankly, to blunt momentum and 0:06:50.480 --> 0:06:53.520 blunt the potential ceiling that she has, which is, you know, 0:06:53.600 --> 0:06:54.400 quite substantial. 0:06:55.480 --> 0:06:57.600 I look at this and just as a vignette, and 0:06:57.600 --> 0:07:01.400 I have not seen the video, folks, Neil Cavudo over 0:07:01.440 --> 0:07:04.600 at Fox last night went after the senator from Louisiana. 0:07:05.160 --> 0:07:09.520 Mister Kennedy on the verbiage that seems to be used 0:07:09.600 --> 0:07:14.480 by the Trump campaign and Trump supporters against the Vice president. 0:07:15.320 --> 0:07:19.040 Is everybody on the same page within conservative America? Or 0:07:19.120 --> 0:07:23.160 do you see the divides Terry even greater as you've 0:07:23.240 --> 0:07:26.160 laid out for the last two years? Oh? 0:07:26.200 --> 0:07:29.440 I see the divides in terms of the message. The 0:07:29.480 --> 0:07:32.520 message is all over the place right now, and and 0:07:32.560 --> 0:07:35.800 there isn't a clear signal from the Trump side about 0:07:35.800 --> 0:07:39.160 what they you know, what they prefer. So therefore, you know, 0:07:39.200 --> 0:07:42.680 you're getting very scattershot kind of kind of words. And 0:07:42.800 --> 0:07:46.200 you know, by comparison, the Harris folks have been have 0:07:46.280 --> 0:07:47.360 been very disciplined on that. 0:07:47.760 --> 0:07:50.120 Terry John Tucker here the question, are you going to 0:07:50.160 --> 0:07:51.800 ask him about property taxes? 0:07:53.400 --> 0:08:01.600 Oh? Yeah, it's saltcoming in the hunt you or Vice President? 0:08:02.120 --> 0:08:05.040 I'm hearing now the name of the Minnesota Governor Tim Waltz. 0:08:05.320 --> 0:08:09.760 Who is he and does he counterbalance the idea of 0:08:08.960 --> 0:08:11.920 the liberal San Francisco Democrat? 0:08:13.040 --> 0:08:16.960 Governor Wall seems to be beloved of progressives, and for 0:08:16.960 --> 0:08:20.680 that reason alone, I think I discount his chances. 0:08:21.720 --> 0:08:21.920 You know. 0:08:22.000 --> 0:08:25.840 The you know, what Harris needs is is balance on 0:08:25.880 --> 0:08:28.800 the ticket. She needs it both geographically. She needs it 0:08:28.800 --> 0:08:30.880 in terms of swing states, and she needs it in 0:08:30.960 --> 0:08:36.120 terms of you know, the centrism, and I think Walts 0:08:36.160 --> 0:08:38.240 doesn't really fill much. 0:08:38.120 --> 0:08:39.000 Of those buckets. 0:08:39.040 --> 0:08:43.960 So I think that he's less likely than somebody like 0:08:43.960 --> 0:08:46.160 like Shapiro for example, like Whitmer. 0:08:46.240 --> 0:08:46.720 Maybe. 0:08:46.840 --> 0:08:51.840 Okay, so as the favorite son of Pittsburgh, Terry, you're 0:08:51.840 --> 0:08:56.080 going for Pennsylvania's governor with his nineteen electoral college votes. 0:08:57.040 --> 0:09:00.280 Well, now, favorite sonism doesn't havehing to do with it, really, John, 0:09:00.360 --> 0:09:01.719 the it's much more that. 0:09:03.440 --> 0:09:03.679 You know. 0:09:04.320 --> 0:09:06.960 I think last time I saw you all I called 0:09:07.000 --> 0:09:10.880 this the captain obvious analysis, and that is that he 0:09:10.960 --> 0:09:14.480 fills the biggest electoral college need, and he also checks 0:09:14.480 --> 0:09:17.960 all of those other boxes as well. It's interesting to 0:09:18.000 --> 0:09:20.680 me that there's been a somewhat of a backlash within 0:09:20.720 --> 0:09:26.080 Democratic circles about his unabashed support for Israel. You know, 0:09:26.120 --> 0:09:31.120 I think that's plus for him. Frankly, that's ticket back Terry. 0:09:31.200 --> 0:09:35.320 John Tucker has a one item candidate voter. Rather, all 0:09:35.320 --> 0:09:38.440 he cares about is property texts in New Jersey and 0:09:38.480 --> 0:09:40.920 a repeal of the assault. Are there a lot of 0:09:41.040 --> 0:09:43.920 John Tucker's out there and issues when you look at 0:09:43.920 --> 0:09:48.559 the electorate of America. How much of us has one item? 0:09:49.080 --> 0:09:51.400 This is the way we want to be. Are we 0:09:51.520 --> 0:09:54.000 that focused? Are we more sophisticated? 0:09:55.200 --> 0:09:58.320 Ah, We're more scattershot. I think there's I'd say most 0:09:58.400 --> 0:10:01.440 voters care about lots of different issues. And you see 0:10:01.559 --> 0:10:04.319 you see that, you know, in the usual surveys that happen, 0:10:04.840 --> 0:10:07.400 there aren't that many to think only one thing is important. 0:10:07.960 --> 0:10:11.480 I will say that I've been hearing uh, you know, 0:10:11.920 --> 0:10:15.640 hugely from New York New Jersey area folks for a 0:10:15.720 --> 0:10:19.920 decade now about salt and whether it might come back, 0:10:20.000 --> 0:10:22.880 and so that seems to be a myopic focus of 0:10:23.160 --> 0:10:24.360 your particular area. 0:10:24.480 --> 0:10:27.000 It seems to be very myopic, particularly to my right 0:10:27.040 --> 0:10:31.680 here at Bloomberg Studio, Terry. Let's go then to the border, 0:10:32.080 --> 0:10:34.680 and does a gentleman from Arizona have a strength for 0:10:34.760 --> 0:10:39.120 Vice President Harris because he's in Tucson, some hundred miles 0:10:39.120 --> 0:10:39.760 from the border. 0:10:40.640 --> 0:10:42.959 I think it's less I think it's less likely that 0:10:43.080 --> 0:10:45.640 Senator Kelly gets it because of the because of the 0:10:46.559 --> 0:10:50.119 UH and UH, and also less likely because of Arizona. 0:10:50.160 --> 0:10:52.400 If you look at the swing States, Arizona seems a 0:10:52.440 --> 0:10:55.160 little bit more out of hand than uh and and 0:10:55.280 --> 0:10:58.160 less gettable, I would say than some of the others, 0:10:58.160 --> 0:11:03.080 although I think it very much in play. But comparatively speaking, 0:11:03.160 --> 0:11:05.559 the Harris people seem to be emphasizing what they call 0:11:05.640 --> 0:11:10.760 the blue Wall of Michigan, Wisconsin, and Pennsylvania. That seems 0:11:10.760 --> 0:11:13.600 to be where their focus is. And you know, although 0:11:13.960 --> 0:11:16.240 Senator Kelly I think would be a fine candidate. 0:11:16.360 --> 0:11:18.080 When do I get the polls that are really going 0:11:18.120 --> 0:11:20.720 to tell me about how this new lineup is faring? 0:11:22.120 --> 0:11:24.120 I think not until after Labor Day, John, And the 0:11:24.160 --> 0:11:27.040 reason why is that you know what you see here 0:11:27.120 --> 0:11:30.679 in something of hammer for a while. But you know, 0:11:30.800 --> 0:11:33.120 registered voter poles, I think, don't tell you very much. 0:11:33.120 --> 0:11:35.240 And that's pretty much all you've got right now. I mean, 0:11:35.240 --> 0:11:38.959 I've seen likely voter polls occasionally, but you know, registered 0:11:39.040 --> 0:11:41.559 voter poles are like, you know, I'm thinking about maybe 0:11:41.559 --> 0:11:44.040 going to see that movie over the weekend. As opposed 0:11:44.080 --> 0:11:45.800 to the people who are actually going to go see 0:11:45.800 --> 0:11:49.920 the movie, it is less of less interest to you know, 0:11:50.000 --> 0:11:53.280 theater owners and movie studios who might see as opposed 0:11:53.320 --> 0:11:55.480 to who's likely to see. So I think it gets 0:11:55.520 --> 0:11:58.920 the stilled down starting after Labor Day before then not 0:11:58.960 --> 0:12:00.000 really running those poles. 0:12:00.160 --> 0:12:02.719 Just quickly here, Terry Haines, is as simple as this 0:12:02.920 --> 0:12:05.760 old style. I'll use Reagan, but I could use any 0:12:05.760 --> 0:12:10.840 other candidate as well. You entrenched the base through August, 0:12:11.160 --> 0:12:15.240 get into September, and as a miraculous amendment the second 0:12:15.240 --> 0:12:18.199 week of October where you move to the middle. Are 0:12:18.240 --> 0:12:19.600 we that old school? 0:12:20.600 --> 0:12:23.439 Well yeah, I mean that that both of these campaigns 0:12:23.520 --> 0:12:27.000 are a start from the premise that their bases are 0:12:27.040 --> 0:12:29.800 not secure, which is interesting because they're always talked about 0:12:29.800 --> 0:12:32.160 as if they are, but they're not. They're constantly doing 0:12:32.200 --> 0:12:35.400 things to try to to lock down their base. But 0:12:35.440 --> 0:12:37.319 then they you know, they kind of move to the middle, 0:12:37.360 --> 0:12:39.240 and you'll see Harris start to move to the middle 0:12:39.240 --> 0:12:42.640 with the vice presidential pick. I think Trump, in contrast, 0:12:42.679 --> 0:12:45.800 I think has given up his chance to bridge by 0:12:46.679 --> 0:12:49.040 picking Vance and I said so an hour after we 0:12:49.120 --> 0:12:52.880 got picked. You know, he doubled down on I think 0:12:53.280 --> 0:12:55.480 more small ball, and it's going to come back to 0:12:55.480 --> 0:12:55.920 bite him. 0:12:56.120 --> 0:12:58.840 Terry Haynes, thank you so much for Pangaea. An update 0:12:58.840 --> 0:13:03.360 there and really careful advice. I think to maintain the 0:13:03.440 --> 0:13:11.000 certitude until we get into September. In October, ed Ludlow. 0:13:11.400 --> 0:13:14.720 In the last two three four months, he's done a 0:13:14.840 --> 0:13:21.080 national value add But you bought a Tesla, right, Retto didn't. 0:13:21.280 --> 0:13:23.000 Retto didn't buy it for your keeper. 0:13:22.800 --> 0:13:25.680 Coming straight out of my paycheck. Rehtto doesn't pay for it. 0:13:25.760 --> 0:13:28.760 You bought a Tesla, and they had a Bloomberg technology 0:13:28.760 --> 0:13:34.599 and all our San Francisco efforts. His chronicled self driving 0:13:35.000 --> 0:13:39.080 on a Tesla like, literally, it's a public good. When 0:13:39.280 --> 0:13:42.760 are we going to have confidence for a Tesla or 0:13:42.800 --> 0:13:45.880 any other car to be quote unquote self driving. 0:13:46.120 --> 0:13:49.240 I don't know when we collectively will have confidence. I 0:13:49.320 --> 0:13:53.600 don't have confidence. So I leased a Tesla. Little why 0:13:53.760 --> 0:13:55.600 I think I've discussed it with you on the show. 0:13:55.679 --> 0:13:55.800 Right. 0:13:55.800 --> 0:13:57.480 I did it because it was the most affordable option 0:13:57.559 --> 0:13:58.760 at the time when I needed a car. 0:13:58.880 --> 0:14:01.360 I was in one yesterday. Actually it's very. 0:14:01.160 --> 0:14:03.840 Comfortable, Yeah, very comfortable, And the lease is like, it's 0:14:04.040 --> 0:14:06.360 very cheap for you know, and we can afford it. 0:14:06.559 --> 0:14:09.280 But I love technology, so my thinking was get hands 0:14:09.320 --> 0:14:11.560 on with it. We write about and talk about full 0:14:11.559 --> 0:14:15.000 self driving supervised software on air all the time. I 0:14:15.040 --> 0:14:16.880 don't think it's fair for a journist to do that 0:14:16.960 --> 0:14:18.720 and not use it. So I've been using it a lot, 0:14:18.800 --> 0:14:21.600 and I have the latest version, twelve point five point 0:14:21.640 --> 0:14:25.640 one that was released limited release Friday. It started to 0:14:25.720 --> 0:14:28.880 roll out widespread today last twenty four hours, and I 0:14:28.880 --> 0:14:31.000 took it for a ride Saturday, thirty miles from my 0:14:31.040 --> 0:14:34.240 home to San Francisco. There were no incidents bar one, 0:14:34.640 --> 0:14:36.120 so Golden gate Bridge iconic. 0:14:36.280 --> 0:14:37.600 All it takes is one incident. 0:14:37.640 --> 0:14:39.240 By the way, well exactly, So I get onto the 0:14:39.240 --> 0:14:41.480 Golden gate Bridge, I'm in the correct lane. I actually 0:14:41.560 --> 0:14:44.240 change the software changes lanes for me, and it spits 0:14:44.280 --> 0:14:46.240 me out the other side, on the San Francisco side, 0:14:46.280 --> 0:14:48.560 and I'm heading toward the toll booth. There are six 0:14:48.600 --> 0:14:50.840 toll booths, only two of them are open. Gets me 0:14:50.880 --> 0:14:52.560 in one of them that's open with a green arrow. 0:14:52.760 --> 0:14:56.040 Good start, but it says very clearly, do not stop. 0:14:56.200 --> 0:14:58.680 Maintain speed twenty five miles an hour. I get to 0:14:58.720 --> 0:15:02.280 the bollards and the self driving system slams the brakes 0:15:02.480 --> 0:15:04.680 and I go down to six miles an hour. What's 0:15:04.720 --> 0:15:08.640 behind me dozens of cars shooting off the bridge, not 0:15:08.680 --> 0:15:10.360 at twenty five miles or forty miles an hour. I 0:15:10.480 --> 0:15:12.440 made the choice in the moment not to intervene. 0:15:12.440 --> 0:15:13.040 I should have done. 0:15:13.120 --> 0:15:16.000 Were you listening to Jefferson Airplane and Grateful Dead? 0:15:18.400 --> 0:15:25.040 I was listening to Kenny Gail. Okay, just classic for 0:15:25.080 --> 0:15:26.480 the Woodwind movement, John. 0:15:26.280 --> 0:15:29.240 Lives and the Garden State Parkway. There's someone doing in 0:15:29.320 --> 0:15:30.400 Ned Ludlow experience. 0:15:30.400 --> 0:15:33.720 Well, no, it's working, that's right. It doesn't take into 0:15:33.760 --> 0:15:37.080 account the other nuts who are behind you on the roadway. 0:15:37.160 --> 0:15:39.320 Yes, yes, and no. It's a purely camera based system, right, 0:15:39.360 --> 0:15:41.760 and there are cameras around the perimeter of the car, 0:15:42.200 --> 0:15:45.880 and so it literally does take into account the nuts 0:15:45.920 --> 0:15:49.240 around you based on what the cameras can detect envision 0:15:49.240 --> 0:15:51.400 in the speed they're moving at. I mean, I saw 0:15:51.440 --> 0:15:53.520 something on the Bloomberg terminal yesterday that I don't think 0:15:53.520 --> 0:15:56.440 I've seen in my career, which is Bloomberg's trick created 0:15:56.520 --> 0:15:59.560 Now writing up that truest analyst note, he reflected on 0:15:59.600 --> 0:16:02.080 his own experience where he almost had an incident, right, 0:16:02.080 --> 0:16:05.200 he almost had crash. But what's the most amazing about 0:16:05.200 --> 0:16:07.080 the story is not just the details of his note 0:16:07.200 --> 0:16:10.600 and his thesis around Tesla's that that story got almost 0:16:10.600 --> 0:16:13.520 fourteen thousand terminal reads in a single kill that day. 0:16:13.920 --> 0:16:15.960 So people care, and I think that's why it's important 0:16:16.000 --> 0:16:16.600 we talk about it. 0:16:16.960 --> 0:16:20.400 Peter Thiel tells a great story about getting in Elon 0:16:20.520 --> 0:16:23.600 Musk when he got his supercar way back when, and 0:16:23.640 --> 0:16:26.320 he crashed it with him in the car. Didn't have 0:16:26.400 --> 0:16:27.880 insurance either, by the way. 0:16:27.760 --> 0:16:31.240 So what's the relationship of Tesla, California to Texas. We 0:16:31.280 --> 0:16:35.160 all know the SOBA right and say, the California Department 0:16:35.320 --> 0:16:40.200 of Driver's Licenses. Is there a government watching of Ed 0:16:40.280 --> 0:16:43.560 Ludlow almost coming to death on the Golden gate Bridge? 0:16:43.600 --> 0:16:44.120 Do they care? 0:16:44.360 --> 0:16:45.840 That's a really excellent question. 0:16:46.040 --> 0:16:47.480 So I only good one of the days to go 0:16:47.560 --> 0:16:47.960 with a day. 0:16:48.080 --> 0:16:50.560 The answer is that the federal level, it's NITZA, the 0:16:50.680 --> 0:16:55.800 National Highway in Traffic Safety Administration, who essentially policed this 0:16:56.480 --> 0:16:59.800 and different to other companies that you may or may 0:16:59.800 --> 0:17:01.680 not have heard of, for example Zooks which is owned 0:17:01.680 --> 0:17:04.840 by Amazon, or Waimo, which is owned by Alphabet, the 0:17:04.840 --> 0:17:08.439 parent of Google. What Tester is doing is developing this 0:17:08.560 --> 0:17:11.520 technology through the consumer in the real world with a 0:17:11.600 --> 0:17:16.600 view long term to operating so called robotaxi fleet. And 0:17:16.680 --> 0:17:19.119 what others are doing are testing vehicles where there is 0:17:19.200 --> 0:17:21.639 no driver in the front seat and the consumer sits 0:17:21.640 --> 0:17:24.760 in the back a genuine robotaxi, and that answers the 0:17:24.840 --> 0:17:27.800 jurisdiction question that because this is going through the consumer, 0:17:28.200 --> 0:17:32.240 it's largely NITZA that is adjudicating the development of it 0:17:32.320 --> 0:17:35.360 in the risk in real time in this country only, 0:17:35.400 --> 0:17:35.920 I should. 0:17:35.720 --> 0:17:39.440 Say, crossing fifty seventh Street this morning at three am, 0:17:39.680 --> 0:17:44.800 they've milled the roadway preparing it for removing. There are 0:17:44.800 --> 0:17:46.919 no lines on the roadway and this has been this 0:17:46.960 --> 0:17:49.159 way for three week typical in New York City. You 0:17:49.200 --> 0:17:52.520 get prepared to pave a roadway, it takes about three 0:17:52.560 --> 0:17:56.520 weeks after you jam. Well, no, it's the truth. AI 0:17:56.680 --> 0:17:58.119 is going to solve that problem for me. 0:17:58.320 --> 0:18:00.040 Finance, isn't you go across. 0:17:59.720 --> 0:18:01.880 Fifty seven streets lines the road? 0:18:02.040 --> 0:18:05.000 So this is another excellent question. In the truest note, 0:18:05.119 --> 0:18:08.160 the analyst recalls three incidents where he had to intervene 0:18:08.200 --> 0:18:11.680 because he felt unsafe. What the camera system is supposed 0:18:11.720 --> 0:18:14.800 to do is detect all elements of the road around you, 0:18:14.880 --> 0:18:17.680 including a white solid line now on a freeway or 0:18:17.680 --> 0:18:20.400 a highway environment, the rules of the road in any 0:18:20.440 --> 0:18:22.840 state are that you must not change lane with a 0:18:22.880 --> 0:18:26.520 white solid line. In the analyst's note, the car chose 0:18:26.560 --> 0:18:29.760 to change lane of its own decision making, breaking that 0:18:29.880 --> 0:18:32.000 rule of the road. Now, in the incident or the 0:18:32.320 --> 0:18:34.960 environment you've described, there are no lines, and so that's 0:18:35.000 --> 0:18:37.119 one of the things the camera based system is supposed 0:18:37.160 --> 0:18:39.800 to use to help it navigate the world around it. 0:18:39.800 --> 0:18:44.280 It's another great question. It would use proximity to basically 0:18:44.320 --> 0:18:46.600 maintain a course, but of course it's not ideal. 0:18:46.760 --> 0:18:52.000 Do you assume at some point that Tesla will continue this, 0:18:52.160 --> 0:18:55.040 reinvigorate it, or will they step aside and say we 0:18:55.200 --> 0:18:56.040 just can't get it done. 0:18:56.320 --> 0:18:56.800 They're all in. 0:18:56.880 --> 0:18:59.440 I mean, my sourcing that company is that this is it, 0:18:59.680 --> 0:19:01.880 and you're either with it or you're not. I'll say 0:19:01.880 --> 0:19:03.719 something I've said to you many times Tom, which is 0:19:04.000 --> 0:19:07.600 Elon Musk is often late, always late, but he gets 0:19:07.680 --> 0:19:11.080 there in the end, and to his credit, you know, 0:19:11.560 --> 0:19:16.080 it's not a perfect safe experience. It's pretty astonishing the technology. 0:19:16.359 --> 0:19:19.760 The difficulty for investors many listening to this program is 0:19:19.960 --> 0:19:22.160 I don't get the jump. How do I go from 0:19:22.200 --> 0:19:24.960 sitting in my own car where I partially allow it 0:19:25.000 --> 0:19:28.480 to dry itself drive itself to a future where Tesla 0:19:28.520 --> 0:19:31.000 operates a fleet like Uber of robotaxing. 0:19:31.040 --> 0:19:33.760 We've been unfair, We've been Thank you seriously ed for 0:19:34.000 --> 0:19:36.879 just this incredible real life coverage. I read it voraciously 0:19:36.920 --> 0:19:40.240 on the weekends. Ludlow is all I read anything else kind? 0:19:40.400 --> 0:19:44.600 Microsoft this afternoon, what's your nuance at Bloomberg Technology? Yeah? 0:19:44.720 --> 0:19:47.520 I call it this earning season. Do you understand the 0:19:47.560 --> 0:19:50.000 money machine? For every dollar you're putting in the machine, 0:19:50.000 --> 0:19:52.760 how many dollars are coming out? And Microsoft gave us 0:19:52.760 --> 0:19:55.800 a sense of that last quarter. Basically, they gave us 0:19:55.800 --> 0:19:58.480 a CAPEX figure and they said we had thirty percent 0:19:58.520 --> 0:20:01.280 top line growth on Cloud. Seven percent of that came 0:20:01.320 --> 0:20:04.359 from AI and for the street, that was kind of enough. 0:20:04.600 --> 0:20:07.199 But the concern is, you're spending all this money, what 0:20:07.280 --> 0:20:08.760 do you have to show for it in terms of 0:20:08.760 --> 0:20:11.359 top line growth. You guys probably have a longer standing 0:20:11.400 --> 0:20:13.919 relationship with Microsoft than I do. With respect. It's been 0:20:13.960 --> 0:20:16.800 around since the mid seventies. But what it's always been 0:20:16.840 --> 0:20:19.520 good at is selling software you could otherwise get for free, 0:20:19.840 --> 0:20:21.880 and that gives the market some confidence in that name. 0:20:21.880 --> 0:20:24.880 It's one of the most widely held stocks among institutionals 0:20:24.920 --> 0:20:25.919 and retailers on the planet. 0:20:26.119 --> 0:20:27.919 We're doing it. We have a baseball player of the 0:20:28.040 --> 0:20:32.040 New York Yankees. It's a baseball team, ED and they 0:20:32.040 --> 0:20:35.199 have a new player that's wonderful called Jazz Chisholm. So 0:20:35.720 --> 0:20:38.439 I talk to your people and I said, what does 0:20:38.640 --> 0:20:41.320 what does Ed Lovelow want in terms of jazz And 0:20:41.359 --> 0:20:45.920 they said, adds just like all Kenny g is Kenny 0:20:46.000 --> 0:20:46.800 g js Jan. 0:20:47.840 --> 0:20:51.440 Well, if that's open to debate, I would say no, 0:20:51.720 --> 0:20:53.520 But yeah. 0:20:53.160 --> 0:21:04.479 Ed Ludlow wember respect. 0:21:06.320 --> 0:21:09.600 Mike Green joins its chief strategies to simplify asset management, 0:21:10.080 --> 0:21:13.680 always thinking about the market for various and sundry firms, 0:21:13.720 --> 0:21:17.960