WEBVTT - China's Search for Stimulus 0:00:01.360 --> 0:00:05.680 This is Bloomberg Business Wait inside from the reporters and 0:00:05.880 --> 0:00:09.440 editors who bring you America's most trusted business magazine, plus 0:00:09.520 --> 0:00:13.680 global business, finance and tech news. The Bloomberg Business Week 0:00:13.720 --> 0:00:19.000 Podcast with Carol Messer and Tim Stenebek from Bloomberg Radio. 0:00:20.560 --> 0:00:22.720 All Right, we keep saying it over and over again. 0:00:22.840 --> 0:00:24.680 Get a twenty four hour news cycle with a lot 0:00:24.680 --> 0:00:26.160 of news out of China. And I feel like I've 0:00:26.160 --> 0:00:28.400 been saying that for the last two or three weeks. 0:00:28.960 --> 0:00:31.520 And our Balance of Power newsletter coming out today noting 0:00:31.600 --> 0:00:34.480 all roads no longer lead to Rome, they lead to Beijing. 0:00:34.960 --> 0:00:38.160 And this as US Commerce Secretary Gina Romando was wrapping 0:00:38.200 --> 0:00:40.720 up her trip to China. Yeah, the UK Foreign Secretary 0:00:41.159 --> 0:00:44.199 also arriving. That's the most senior British diplomatic visitor in 0:00:44.240 --> 0:00:47.680 five years. Russian President Vlatimir Putin's likely to visit as 0:00:47.720 --> 0:00:48.680 well in October. 0:00:48.720 --> 0:00:49.519 That's a big one. 0:00:49.800 --> 0:00:53.920 Yeah, to meet up with President Ji and so there's 0:00:53.960 --> 0:00:54.680 a lot going on. 0:00:54.840 --> 0:00:57.160 Yeah, we're really glad to have back with us for 0:00:57.240 --> 0:01:00.680 some analysis, for insight on the situation, also for the 0:01:00.720 --> 0:01:03.440 market and business outlook of China. We've got Andy Brown 0:01:03.480 --> 0:01:06.399 with us He's the former editorial director at Bloomberg New Economy, 0:01:06.680 --> 0:01:09.199 and he spent three decades in Asia as both China 0:01:09.280 --> 0:01:11.800 editor and a columnist for The Wall Street Journal. Today, 0:01:11.840 --> 0:01:14.160 Carol Andy leads the China Hub as a partner at 0:01:14.160 --> 0:01:16.880 Brunswick Group. It's a critical issues advisory firm. He joins 0:01:16.959 --> 0:01:18.200 us on Zoom from New York City. 0:01:18.280 --> 0:01:20.560 Andy, So good to have you back with us. We've 0:01:20.560 --> 0:01:22.479 been dying to talk to you because you really always 0:01:22.520 --> 0:01:25.000 give us some clarity on everything that's going on. So 0:01:25.080 --> 0:01:27.440 as our Balance of Power newsletter said, all roads no 0:01:27.520 --> 0:01:30.200 longer lead to Rome, They lead to Beijing, are they right? 0:01:32.360 --> 0:01:34.360 Well, first of all, it's great to be back on 0:01:34.400 --> 0:01:37.319 the show, Carol, tim always to be with you. 0:01:38.920 --> 0:01:40.440 All roads lead to Beijing. 0:01:40.560 --> 0:01:45.280 Certainly, Gina Raymondo's road led to Beijing and by all 0:01:45.319 --> 0:01:52.600 accounts a very successful visit. The Chinese take Gina Ramondo 0:01:52.720 --> 0:01:56.440 very seriously. They trust her, They seem to have a 0:01:56.440 --> 0:02:02.440 good relationship with her. They find her pragmatic, relatively non ideological. 0:02:02.520 --> 0:02:05.960 And this is really quite remarkable given that Gina Raymondo 0:02:06.520 --> 0:02:11.200 is at the sharp end of US economic engagement with China. 0:02:11.320 --> 0:02:16.440 Right She's the one that presides over this proliferating regime 0:02:16.720 --> 0:02:20.560 of sanctions and export controls and tariffs, which, of course 0:02:20.639 --> 0:02:24.680 this administration inherited from the last one, and the Chinese 0:02:24.720 --> 0:02:30.720 finders deeply threatening. Nonetheless, she had a pretty good visit, 0:02:30.800 --> 0:02:34.560 and her main message was no, no, no, we're not 0:02:34.639 --> 0:02:36.360 here to kill you. We don't want to put you 0:02:36.400 --> 0:02:41.440 out of business. This is not decoupling. This is de risking, 0:02:41.440 --> 0:02:42.720 and that's a very different thing. 0:02:42.840 --> 0:02:44.880 Well, what did you make of her comment that she 0:02:45.040 --> 0:02:48.040 argued that China is driving away American companies by making 0:02:48.080 --> 0:02:51.480 investments in the world's second biggest economy increasingly hazardous. She 0:02:51.560 --> 0:02:53.520 said that, Okay, here's the quote, Andy, I know, you 0:02:53.600 --> 0:02:55.400 know it. We talked a little bit about it yesterday. 0:02:55.800 --> 0:02:59.480 Increasingly I hear from businesses China is uninvestable because it's 0:02:59.480 --> 0:03:02.600 become too risky. This is what Gina Ramando told reporters 0:03:02.639 --> 0:03:05.080 Tuesday when she was aboard a high speed train from 0:03:05.080 --> 0:03:05.840 Beijing to Shanghai. 0:03:06.120 --> 0:03:08.960 Investment flows have been flowing out from foreign investors. 0:03:09.919 --> 0:03:13.400 Well, she said the right thing, and that's what they 0:03:13.440 --> 0:03:17.720 need to hear because quite often in China, the CEOs 0:03:17.760 --> 0:03:21.000 of the companies that are investing there don't dare speak 0:03:21.080 --> 0:03:23.720 that kind of truth to power. And so you know, 0:03:23.760 --> 0:03:27.120 it takes a gene Raymondo to go over there and 0:03:27.120 --> 0:03:29.680 and say, look, we have a we have a problem, 0:03:29.720 --> 0:03:33.560 and businesses certainly do have a problem now in China. 0:03:34.160 --> 0:03:36.640 It's still I think it's significant though. The second part 0:03:36.680 --> 0:03:40.360 of your commentry, she went on a high speed train. 0:03:40.840 --> 0:03:43.440 You know, that's that's interesting, right, That's that's kind of 0:03:43.480 --> 0:03:44.280 a common touch. 0:03:44.320 --> 0:03:46.760 She hopped the train to go down to Shanghai. 0:03:46.840 --> 0:03:47.880 The Chinese would have liked that. 0:03:47.960 --> 0:03:51.960 They showcased, you know, really unbelievably efficient two hundred mile 0:03:52.040 --> 0:03:55.240 an hour of four and a half hours from from Beijing. 0:03:55.080 --> 0:03:58.520 That Songhai, which is like unbelievable. 0:03:58.560 --> 0:04:01.440 We don't have that here in What is it about 0:04:01.520 --> 0:04:06.280 her that resonates so well with Chinese officials, Well. 0:04:06.600 --> 0:04:09.480 I think they feel that they can talk to her 0:04:09.520 --> 0:04:12.360 and they're going to get a straight answer. And that 0:04:12.440 --> 0:04:16.320 really was you know, and she she also you know, 0:04:16.400 --> 0:04:21.400 she she's she's constructive, right, so I thought, actually, she 0:04:21.400 --> 0:04:23.880 she handled it in a really smart way. She said, look, 0:04:24.279 --> 0:04:28.760 let let's start by with confidence building matches. So one 0:04:28.760 --> 0:04:31.200 of the things that she's agreed on is that the 0:04:31.279 --> 0:04:34.520 United States and China are going to promote. 0:04:34.240 --> 0:04:35.599 Travel, right, tourism. 0:04:36.080 --> 0:04:39.920 So who can disagree that it would be a good 0:04:40.040 --> 0:04:43.360 thing if more Americans went to China and more Chinese 0:04:43.360 --> 0:04:47.000 people came to the United States. Right, It builds trust, 0:04:47.279 --> 0:04:50.960 builds understanding people to people relations. You know, these countries 0:04:51.000 --> 0:04:54.680 have been separated now for three years under under lockdown. 0:04:55.160 --> 0:04:56.000 Very few flights. 0:04:56.040 --> 0:04:57.800 Now, I was in Beijing a couple of months ago. 0:04:58.080 --> 0:05:00.599 I was actually staying in four seasons hotel. Only foreigner 0:05:00.640 --> 0:05:02.720 in the in the whole hotel, right, I mean, the 0:05:03.520 --> 0:05:05.320 airport is half empty. 0:05:05.440 --> 0:05:07.880 We need more interaction and it's. 0:05:07.760 --> 0:05:10.120 Just a great place, a smart place to stop. 0:05:10.240 --> 0:05:12.719 Well, Andy, talk more about that, and give us some 0:05:12.760 --> 0:05:14.960 anecdotes from your recent trip there, because you've spent so 0:05:15.040 --> 0:05:17.359 much time in the country. Uh, I know this is 0:05:17.400 --> 0:05:20.480 post pandemic. You went there kind of during the pandemic too, 0:05:21.440 --> 0:05:23.800 when you were helping with you know, with the Olympics 0:05:23.800 --> 0:05:26.640 for NBC. But but just give us the differences that 0:05:26.720 --> 0:05:28.880 you see now based on your recent trip. 0:05:30.760 --> 0:05:31.000 Yeah. 0:05:31.120 --> 0:05:32.960 Well, I mean you've got to go. 0:05:33.080 --> 0:05:35.760 I mean you have to go there to feel this, 0:05:37.960 --> 0:05:41.240 the sense you get by talking to people on the street, 0:05:41.400 --> 0:05:45.800 my friends, people in the business community, people are kind 0:05:45.800 --> 0:05:46.760 of in shock, you know. 0:05:47.120 --> 0:05:48.400 I mean I understand this. 0:05:49.000 --> 0:05:52.960 You know, the the the the you know, the consumer 0:05:53.360 --> 0:05:57.400 confidence has really been shattered. I mean, people, I think 0:05:57.520 --> 0:06:01.920 feel really kind of discombind this disoriented. 0:06:02.000 --> 0:06:03.000 I mean, what just happened. 0:06:03.000 --> 0:06:06.680 You know, we went through a three a three year lockdown, 0:06:06.760 --> 0:06:08.440 and it was quite painful. I mean, you talk to 0:06:08.480 --> 0:06:11.279 people in Shanghai. They're suffering from something like post traumatic 0:06:11.360 --> 0:06:12.240 stress disorder. 0:06:12.320 --> 0:06:12.480 Right. 0:06:12.760 --> 0:06:15.280 These are these are you know, middle class, upper middle 0:06:15.320 --> 0:06:18.600 class families that didn't know if they were going to 0:06:18.640 --> 0:06:21.560 spend that night in bed in their own homes or 0:06:21.640 --> 0:06:24.520 be carted away to some isolation center, or if their 0:06:24.560 --> 0:06:26.960 kids would be taken from them, or if guys in 0:06:27.000 --> 0:06:30.080 white hazmat suits were going to burst through the front door, 0:06:30.240 --> 0:06:32.480 you know, and drag them out or put a lock 0:06:32.600 --> 0:06:35.000 on the outside of the door. They didn't know sometimes 0:06:35.040 --> 0:06:37.960 if they could even feed their families, right, And they've 0:06:37.960 --> 0:06:40.760 been so used to a government that looks after all this, 0:06:41.000 --> 0:06:43.720 that you know, is focused. 0:06:43.200 --> 0:06:45.159 On growth, focused. 0:06:44.720 --> 0:06:46.880 On on you know, on. 0:06:46.920 --> 0:06:51.080 Development, and it just seems like, you know, they're lurching 0:06:51.320 --> 0:06:56.720 from one blunder to another. And you know, the business, 0:06:56.760 --> 0:07:00.240 business confidence obviously is has has yet to recover, and 0:07:00.400 --> 0:07:02.600 the and the confidence of foreign investors. And that's what 0:07:02.680 --> 0:07:05.680 Gina Raimondo was was speaking to. You know, people got 0:07:05.720 --> 0:07:09.040 so used to the idea that Chinese supply chains were secure, right, 0:07:09.040 --> 0:07:10.880 and you could put them all in China. That's what 0:07:10.960 --> 0:07:14.200 Apple did the whole lot. And look what Apple's doing now. 0:07:14.240 --> 0:07:17.240 You know, it's starting at the margins, pulling it out, 0:07:17.480 --> 0:07:20.640 you know, putting it in places like Vietnam, India. It's 0:07:20.720 --> 0:07:22.960 all about now de risking. 0:07:23.320 --> 0:07:25.240 Back to Andy Brown, we go as you as we 0:07:25.240 --> 0:07:27.840 said earlier, he leads the China Hub. He's a partner 0:07:27.920 --> 0:07:30.040 over at Brunswick Group. Hosta with us on Zoom in 0:07:30.040 --> 0:07:33.320 New York City and you had the break. 0:07:33.520 --> 0:07:33.720 Yeah. 0:07:33.760 --> 0:07:37.239 My question, my question, Andy, is if China is doing 0:07:37.240 --> 0:07:40.960 so poorly in its attempted recovery from three years of lockdowns, 0:07:40.960 --> 0:07:43.440 if the consumer is so weak, if the concerns about 0:07:43.600 --> 0:07:47.239 shadow banks crumbling and not paying people back, do American 0:07:47.280 --> 0:07:52.320 companies really want to invest in China? 0:07:52.480 --> 0:07:55.720 You know, Tim, I think it's so important to put 0:07:55.760 --> 0:08:02.600 this into perspective. China is not collapsing, okay, China is 0:08:02.640 --> 0:08:04.600 suffering from what some people. 0:08:04.320 --> 0:08:05.760 Call the four d's. 0:08:05.880 --> 0:08:09.120 You've got a demographic crisis, you have a debt crisis, 0:08:09.200 --> 0:08:13.840 you have a decoupling problem, you have a deflation problem. 0:08:13.960 --> 0:08:17.480 The headlines look terrible, and it is extraordinary. 0:08:17.520 --> 0:08:17.760 China. 0:08:17.960 --> 0:08:21.040 The Chinese economy is barely growing right now, and the 0:08:21.160 --> 0:08:22.800 US economy is steaming ahead. 0:08:22.800 --> 0:08:25.640 I think it's growing what six percent? 0:08:25.880 --> 0:08:28.360 A complete role reversal. 0:08:28.560 --> 0:08:32.640 Right, but. 0:08:33.960 --> 0:08:37.320 China is the world's second largest economy, and it's going 0:08:37.360 --> 0:08:41.439 to be the second or third largest economy for decades 0:08:41.679 --> 0:08:42.120 to come. 0:08:42.280 --> 0:08:48.120 Right, it's not going away. I think what we can expect. 0:08:47.840 --> 0:08:52.120 Big, big, big picture, a starting now a period of 0:08:52.400 --> 0:08:59.520 slow relative decline. Businesses still must be in China, right, 0:08:59.720 --> 0:09:04.360 they can't ignore China, and particularly the businesses that are 0:09:04.400 --> 0:09:09.000 relying on China for future growth luxury, chemicals, auto and 0:09:09.080 --> 0:09:12.280 so on. In those industries they're pouring investment in. 0:09:12.360 --> 0:09:13.000 They have to. 0:09:13.520 --> 0:09:16.240 I mean, you can't be half hearted in China. You've 0:09:16.240 --> 0:09:18.360 got to be all in because the competition there is 0:09:18.440 --> 0:09:22.000 really good. So if you're there and you're dependent on growth, 0:09:22.200 --> 0:09:24.760 you have to invest to keep up with the market. 0:09:25.000 --> 0:09:27.400 You have to invest in technology so that you're able 0:09:27.400 --> 0:09:30.600 to compete. And in fact, some of these companies have 0:09:30.640 --> 0:09:34.840 an aggressive strategy of investment. It's called in China for 0:09:35.000 --> 0:09:39.640 China right So they're buying local companies, they're investing in technology. 0:09:40.000 --> 0:09:42.840 If you don't have to be in China right now, 0:09:43.040 --> 0:09:44.960 you don't want to be in China. If you've never 0:09:45.000 --> 0:09:46.800 been in China, you're certainly not going to go there 0:09:46.840 --> 0:09:50.360 for the first time now. And if you are in China, 0:09:50.880 --> 0:09:54.240 money investment that you might have put into China over 0:09:54.320 --> 0:09:59.199 and above the need to fuel and fund your footprint there, 0:09:59.360 --> 0:10:01.600 you're now looking at that money and say where else 0:10:01.679 --> 0:10:02.440 could I put it? 0:10:02.600 --> 0:10:03.360 Should I put it. 0:10:03.320 --> 0:10:07.040 In Vietnam, or in India, or in Mexico, or I 0:10:07.160 --> 0:10:09.559 might say here in the United States, which is one 0:10:09.559 --> 0:10:12.319 of the hardest investment destinations in the world right now? 0:10:12.720 --> 0:10:16.400 So do you believe and in your consulting that you 0:10:16.440 --> 0:10:18.760 do with clients, Andy, I mean, is it right though? 0:10:18.840 --> 0:10:22.560 For the US and nations throughout Europe that have slapped 0:10:22.600 --> 0:10:26.560 trade and regulatory penalties on China. You know their claims 0:10:26.559 --> 0:10:29.800 that it's coercive economic market behavior, if you will, are 0:10:29.880 --> 0:10:34.200 they right to do so? Especially when you've got the 0:10:34.240 --> 0:10:37.600 world's second largest economy kind of going through tough times, 0:10:37.640 --> 0:10:39.160 like what's the balance between that. 0:10:41.160 --> 0:10:44.360 Yeah, you know, look, Carol, I mean it is in 0:10:44.679 --> 0:10:48.480 nobody's interest to drive China further in where the country 0:10:48.559 --> 0:10:50.920 is looking in with now right and they feel threatened, 0:10:50.960 --> 0:10:52.200 they feel under sieged. 0:10:52.280 --> 0:10:53.560 This is in nobody's interest. 0:10:53.880 --> 0:10:55.360 It's in nobody's. 0:10:54.920 --> 0:11:00.719 Interest now to exacerbate its economic downturn. It's in nobody's 0:11:00.760 --> 0:11:04.360 that China should want to build its own institutions and 0:11:04.640 --> 0:11:10.200 undermine the global US led system, so, you know, and 0:11:10.240 --> 0:11:13.400 they do feel that they are under siege. 0:11:13.800 --> 0:11:15.600 And look, I get it that there. 0:11:15.520 --> 0:11:19.280 Are internal trends in China that you know, are encouraging 0:11:19.320 --> 0:11:21.920 this move towards in you know, this this focus, a 0:11:22.040 --> 0:11:27.480 relentless focus on national security, but can one also has 0:11:27.520 --> 0:11:31.200 to understand that China is responding also to actions that 0:11:31.240 --> 0:11:35.319 the United States is taking that make it feel that 0:11:35.400 --> 0:11:38.280 the world of the United States is out to get them. 0:11:38.440 --> 0:11:40.599 So you know, they look at this meeting that the 0:11:40.720 --> 0:11:44.280 curtain Camp David with Japan and South Korea and the 0:11:44.360 --> 0:11:48.480 United States, and this just adds to the sense of containment. 0:11:48.760 --> 0:11:50.439 So that's not in anybody. 0:11:50.480 --> 0:11:51.880 And there are a lot of people that are saying, look, 0:11:51.920 --> 0:11:53.960 you know, maybe it's time for a time out on 0:11:54.000 --> 0:11:55.800 some of this. You know, would it be such a 0:11:55.880 --> 0:11:59.440 bad idea to lift the tariffs on China, which, after all, 0:11:59.720 --> 0:12:02.960 I'm achieving any of their objectives of narrowing the trades 0:12:03.040 --> 0:12:05.520 up plus and in fact of being paid for in 0:12:05.600 --> 0:12:08.840 the end by the US consumer. And frankly, I think 0:12:08.880 --> 0:12:12.240 that this was this was something you know, some of 0:12:12.280 --> 0:12:17.520 that sentiment is is exactly what Gina Raymondo was expressing 0:12:17.880 --> 0:12:19.160 in her visit to China. 0:12:19.640 --> 0:12:22.479 We do the United States and China does two billion. 0:12:22.160 --> 0:12:25.160 Dollars a day of trade, you know, and she said, look, 0:12:25.200 --> 0:12:27.880 this trade is good for China, good for the United States, 0:12:28.200 --> 0:12:30.240 and good for the and good for the world. So 0:12:30.679 --> 0:12:32.760 you know, let's let's put some of this in proportion. 0:12:34.000 --> 0:12:37.800 And because can I just wait, follow if the world's 0:12:37.800 --> 0:12:40.360 second largest economy creator, we're going to feel it right 0:12:40.400 --> 0:12:41.800 here in the United States. 0:12:43.520 --> 0:12:46.120 You are, but it's not going to create it, Okay. 0:12:46.320 --> 0:12:47.959 I think the way to think about it is that, 0:12:48.120 --> 0:12:51.319 you know, China is a giant, right, it is an 0:12:51.400 --> 0:12:55.000 economic giant. It's it's manufacturing sector is bigger than the 0:12:55.040 --> 0:12:58.120 United States and Europe combined. Okay, and this year it's 0:12:58.120 --> 0:13:00.480 going to It's going to leap ahead of Japan to 0:13:00.520 --> 0:13:03.800 become the world's largest auto export. It's gobbling up the 0:13:03.840 --> 0:13:07.840 world's evy markets. It's a giant, but it's a giant 0:13:07.880 --> 0:13:10.880 with a weak heart, Okay, And that's going to make 0:13:10.920 --> 0:13:15.920 it less mobile, it's going to make it more prone 0:13:16.640 --> 0:13:17.440 to crisis. 0:13:17.559 --> 0:13:18.520 But it's still a giant. 0:13:19.400 --> 0:13:22.920 Andy this This is Secretary Romando's trip is coming at 0:13:22.960 --> 0:13:25.840 a time when we learned also that Vladimir Putin has 0:13:25.880 --> 0:13:29.240 agreed to visit China in his first trip since the 0:13:29.800 --> 0:13:33.120 ICC War crimes warrant was issued back in March. How 0:13:33.160 --> 0:13:36.959 should we look at China's embrace of Vladimir Putin and 0:13:37.000 --> 0:13:39.040 how that affects relations between the US and China. 0:13:40.840 --> 0:13:43.200 Yeah, this is this is an interesting visit. This This 0:13:43.240 --> 0:13:45.760 will be his first truly internet. He's been to a 0:13:45.760 --> 0:13:49.480 couple of neighboring countries in Central Asia, he went to Iran, 0:13:50.080 --> 0:13:53.840 but this is the first major international trip that he's 0:13:53.880 --> 0:13:59.280 taken since the International Criminal Court and A indicted him 0:13:59.400 --> 0:14:03.880 on on on war crime charges earlier this year. And 0:14:04.040 --> 0:14:06.440 what this is telling us is the Chinese are not 0:14:06.760 --> 0:14:12.800 giving up on Vladimir Putin. He was and remains what 0:14:12.960 --> 0:14:17.880 chi Jin being calls my best friend, regardless of you 0:14:17.880 --> 0:14:22.520 know what's happening in Ukraine. And look, I was in Beijing. 0:14:22.720 --> 0:14:25.960 You mentioned the Winter Olympics at the beginning of the 0:14:25.960 --> 0:14:29.840 beginning of last year, and this was where they hatched 0:14:29.880 --> 0:14:33.200 their no Limits partnership. Right on the opening day of 0:14:33.360 --> 0:14:37.560 Beijing Winter Olympics on February fourth, you know, games finished 0:14:37.640 --> 0:14:40.960 on February twentieth. Four days later, February twenty fourth, the 0:14:41.040 --> 0:14:46.400 tanks and armor and troops roll across the border into Ukraine, 0:14:46.400 --> 0:14:50.040 and ever since then China has been giving Russia diplomatic 0:14:50.120 --> 0:14:52.960 cover in the Ukraine. The bottom line is that they 0:14:53.000 --> 0:14:55.760 can't have Putin failing in China. It would be a 0:14:55.880 --> 0:15:03.200 severe blow personally Tsijim, but also the way they look 0:15:03.240 --> 0:15:06.080 at it in China is, look, you know, if US 0:15:06.200 --> 0:15:11.880 led NATO win here, win next, all right, and and 0:15:11.920 --> 0:15:15.960 so you know, bottom light, they cannot allow him to fail. 0:15:18.160 --> 0:15:20.040 It's complicated, right Andy though. 0:15:21.120 --> 0:15:24.560 It's super complicated because they're paying a pretty heavy price 0:15:24.600 --> 0:15:26.960 for this. And we talk about business investment. European business 0:15:27.000 --> 0:15:30.280 is looking at looking at China. Now they're reading right 0:15:30.280 --> 0:15:32.640 over from Ukraine to Taiwan. And saying, you know, we 0:15:32.680 --> 0:15:35.400 made this big bet on Russia and look where it 0:15:35.440 --> 0:15:35.920 got us. 0:15:35.960 --> 0:15:39.880 And you know we make making an even bigger bet 0:15:40.400 --> 0:15:40.960 on China. 0:15:41.040 --> 0:15:43.360 Governments are looking at European governments are. 0:15:43.320 --> 0:15:45.320 Looking at China in a very different way, you know. 0:15:45.400 --> 0:15:49.440 I mean, this is Putin is Europe's public enemy number one, 0:15:49.520 --> 0:15:53.040 and this is you know, Chi Jinping's best friend. Having 0:15:53.080 --> 0:15:54.800 said that, I mean, there's there's quite a bit that 0:15:54.800 --> 0:15:57.120 they can salvage out of this number one. 0:15:58.120 --> 0:15:59.280 You know, they're going to have a role. 0:15:59.400 --> 0:16:02.960 They they will have a role in any peace agreement, 0:16:03.240 --> 0:16:05.920 and they'll certainly have a big role, one would think, 0:16:06.480 --> 0:16:10.520 in the reconstruction of Ukraine if and when we finally 0:16:10.560 --> 0:16:13.040 get a peace in that country. 0:16:13.280 --> 0:16:16.760 Yeah, all right, listen, thank you so much. So appreciate it. 0:16:17.200 --> 0:16:19.680 We know it's all been busy for everybody, but so 0:16:20.480 --> 0:16:22.720 do appreciate whenever we get time with you. Andy bwall 0:16:22.840 --> 0:16:26.280 Andy Brown, as we said before, leads the China Hub 0:16:26.360 --> 0:16:30.080 as a partner at Brunswick Group and former Bloomberg colleague, 0:16:30.200 --> 0:16:33.120 former editorial director at Bloomberg New Economy. But as we said, 0:16:33.160 --> 0:16:36.000 three decades in Asia, China editor our communist for The 0:16:36.000 --> 0:16:39.160 Wall Street journal, So his experience is on the ground 0:16:39.200 --> 0:16:40.840 experience and really understanding it all. 0:16:41.000 --> 0:16:42.720 We have the data. We like to get the anecdotes 0:16:42.720 --> 0:16:44.800 from Andy two from his trips there totally. 0:16:46.480 --> 0:16:50.080 You're listening to the Bloomberg Business Week podcast. Catch us 0:16:50.120 --> 0:16:53.440 Live weekday afternoons from three to six Eastern Listen on 0:16:53.520 --> 0:16:57.880 Bloomberg dot com, the iHeartRadio app, and the Bloomberg Business App. Well, 0:16:57.920 --> 0:17:00.160 want us Live on YouTube? 0:17:00.800 --> 0:17:03.720 So would you want to talk about the Hurricane Adela? 0:17:04.200 --> 0:17:05.920 Is it right to daily Hidelia? 0:17:06.119 --> 0:17:06.679 Delia too? 0:17:07.080 --> 0:17:10.439 Sounded great in my ear anyway. More importantly, knocking out 0:17:10.480 --> 0:17:12.720 power to one hundreds of thousands of customers, grounding more 0:17:12.760 --> 0:17:16.760 than eight hundred flights, unleashing floods along Florida's coast far 0:17:16.840 --> 0:17:19.480 from where it came ashore as a category Threames three 0:17:19.520 --> 0:17:22.920 storm earlier Wednesday. So we've been all tracking it. I'm 0:17:22.920 --> 0:17:24.920 sure you all have seen it on news, no doubt 0:17:24.920 --> 0:17:25.200 about it. 0:17:25.320 --> 0:17:27.879 Yeah, and Carol, you know, we track how much this 0:17:27.920 --> 0:17:31.000 stuff costs very closely because they're serious economic implications for 0:17:31.119 --> 0:17:34.600 disruptions and for repairs caused by storms. We talked about 0:17:34.600 --> 0:17:37.320 it with Hawaii. Estimates two are starting to come out 0:17:37.320 --> 0:17:39.480 about the cost of this storm, and key research says 0:17:39.480 --> 0:17:41.800 that IMMED lead to ten billion dollars in losses. And 0:17:41.880 --> 0:17:44.320 we know our team has already warned about FEMA running 0:17:44.320 --> 0:17:46.600 out of money following the fire in Hawaii. 0:17:46.640 --> 0:17:48.520 All right, so let's get to it. Lee Mayfield is 0:17:48.560 --> 0:17:51.320 with us. He's director of Response at the Emergency Management 0:17:51.359 --> 0:17:54.600 Consulting from hagrid Y Consulting. Also the former director of 0:17:54.640 --> 0:17:57.560 Public Safety and Emergency Management for Lee County, Florida, which 0:17:57.600 --> 0:18:01.200 includes Cape Coral and Fort Myers. He joins us on 0:18:01.320 --> 0:18:03.800 the phone from Tampa. Also with us as Rob Caroline. 0:18:04.280 --> 0:18:07.240 He's a Bloomberg News meteorologist. He joins us on the 0:18:07.359 --> 0:18:09.400 phone in New York. Rob, I do want to start 0:18:09.440 --> 0:18:11.879 with you. What's the latest on the storm and what 0:18:12.040 --> 0:18:12.600 you are seeing. 0:18:13.440 --> 0:18:16.280 We're seeing in the process of working its way towards 0:18:16.320 --> 0:18:20.800 the Brunswick, Georgia area. Carrol, It's now causing wing dust 0:18:20.880 --> 0:18:23.800 in the vicinity of Brunswick. It's sixty miles an hour 0:18:23.840 --> 0:18:27.160 at Douglas, Georgia also reporting sixty mile hour dust moving 0:18:27.200 --> 0:18:29.840 off to the northeast at twenty miles an hour. There's 0:18:29.840 --> 0:18:32.200 a tornado watch that's an effect from the coastal areas 0:18:32.240 --> 0:18:35.400 of northeastern Georgia, along the South Carolina coast and into 0:18:35.680 --> 0:18:39.119 southeastern North Carolina. That's up through nine o'clock this seasoning. 0:18:39.520 --> 0:18:41.520 The worst of the weather in regards to rain is 0:18:41.720 --> 0:18:44.560 north and northeast of that center of circulation that's west 0:18:44.600 --> 0:18:46.800 of Brunswick, Georgia. We're going to see four to eight 0:18:46.840 --> 0:18:49.240 inches of rain across that area over the next twenty 0:18:49.280 --> 0:18:51.240 four hours, which is going to lead to flash flooding 0:18:51.760 --> 0:18:53.879 near the core of what was the eye of the storm. 0:18:54.240 --> 0:18:56.280 That's where the highest winds are. You just mentioned the 0:18:56.320 --> 0:18:58.760 power outages. You look at the track map, you look 0:18:58.760 --> 0:19:01.040 at the power outages. They match right up from where 0:19:01.080 --> 0:19:03.920 it when inland at each Florida this morning and where 0:19:03.960 --> 0:19:06.440 it is now. Over the next six to twelve hours, 0:19:06.480 --> 0:19:09.320 the track will change from northeast to east northeast, so 0:19:09.440 --> 0:19:12.159 it's going to allow the storm to move across northeastern 0:19:12.240 --> 0:19:16.359 Georgia then up through eastern South Carolina tonight. Computer models 0:19:16.359 --> 0:19:18.800 the latest ones coming in have the storm then exiting 0:19:18.880 --> 0:19:22.440 the US coast just east of Wilmington, North Carolina, around 0:19:22.520 --> 0:19:23.879 seven o'clock tomorrow morning. 0:19:24.080 --> 0:19:27.520 So after seven o'clock tomorrow morning, rob Is. I mean, 0:19:27.600 --> 0:19:29.479 the worst of it is behind us. 0:19:30.160 --> 0:19:32.080 The worst of it will behind us. We'll notice that 0:19:32.280 --> 0:19:34.800 it's probably going to become a strong tropical storm overnight 0:19:34.840 --> 0:19:37.480 because the core is still inland. So what's happening is 0:19:37.560 --> 0:19:39.359 those wings of one hundred and twenty five miles now 0:19:39.680 --> 0:19:43.280 made landfall this morning are slowly winding down. We'll probably 0:19:43.359 --> 0:19:46.120 still see some dust up over hurricane fourth strength leader 0:19:46.160 --> 0:19:49.000 tonight into tomorrow morning, especially along the South and North 0:19:49.040 --> 0:19:51.440 Carolina coast. The outer banks will probably see those type 0:19:51.440 --> 0:19:53.880 of wings. But once it gets out into the Atlantic, 0:19:54.359 --> 0:19:56.520 all the really heavy rain that we're seeing north and 0:19:56.600 --> 0:19:59.240 northeast of the center will push out into the Atlantic 0:19:59.320 --> 0:20:02.040 and the flesh issues will go away. The only remaining 0:20:02.080 --> 0:20:04.680 issues will be some winds through midday tomorrow along the 0:20:04.720 --> 0:20:06.800 coast of North Carolina, and it's not as far south 0:20:06.840 --> 0:20:08.120 as Myrtle Beach, South Carolina. 0:20:08.160 --> 0:20:09.720 Hey, one thing I want to get into Listen, we 0:20:09.840 --> 0:20:12.880 have storms, and we've had, you know, my whole lifetime hurricanes. 0:20:12.880 --> 0:20:15.560 We have hurricane season and I'm not playing light to it. 0:20:15.680 --> 0:20:19.040 And I you know, there's lives at risk, and hope 0:20:19.119 --> 0:20:23.080 everyone that is in the path of this storm does okay. 0:20:23.560 --> 0:20:25.040 But what I want to get to with you, Lee, 0:20:25.280 --> 0:20:27.119 and then Rob way in on this as well, is 0:20:28.280 --> 0:20:31.200 in terms of what we increasingly are seeing in terms 0:20:31.240 --> 0:20:34.080 of the frequency, strength, force, and the impact and the 0:20:34.119 --> 0:20:38.000