WEBVTT - Trump’s Impossible Task

0:00:02.920 --> 0:00:10.719
<v Speaker 1>Bloomberg Audio Studios, Podcasts, radio news. This is Bloomberg Business

0:00:10.720 --> 0:00:13.960
<v Speaker 1>Wait inside from the reporters and editors who bring you

0:00:14.000 --> 0:00:18.360
<v Speaker 1>America's most trusted business magazine, plus global business, finance and

0:00:18.400 --> 0:00:22.680
<v Speaker 1>tech news. The Bloomberg Business Week Podcast with Carol Messer

0:00:23.040 --> 0:00:25.800
<v Speaker 1>and Tim Stenebeck from Bloomberg Radio.

0:00:26.800 --> 0:00:28.520
<v Speaker 2>Now, would you want to get to one thing that

0:00:28.600 --> 0:00:32.000
<v Speaker 2>is certainly toplined for world leaders at G twenty and elsewhere?

0:00:32.280 --> 0:00:35.519
<v Speaker 3>Dj T Donald J. Trump's administration and.

0:00:35.479 --> 0:00:38.480
<v Speaker 2>Cabinet picks chief among them, who will take the job

0:00:38.560 --> 0:00:39.800
<v Speaker 2>of US Treasury Secretary.

0:00:39.880 --> 0:00:41.760
<v Speaker 4>Yeah, it's kind of turning into this game of thrones,

0:00:41.800 --> 0:00:43.559
<v Speaker 4>and that's where we go now to jockeying around the

0:00:43.640 --> 0:00:47.040
<v Speaker 4>selection for the nation's next treasury secretary. Bloomberg business Week

0:00:47.080 --> 0:00:49.839
<v Speaker 4>national correspondent Josh Green joins us on that and on

0:00:49.880 --> 0:00:53.560
<v Speaker 4>his BusinessWeek story on the President Elect's impossible task. Josh

0:00:53.600 --> 0:00:56.120
<v Speaker 4>is the author of Devils Bargain, Steve Bannon, Donald Trump

0:00:56.160 --> 0:01:00.560
<v Speaker 4>and the Nationalists Uprising and the Rebels, Elizabeth Warrenney Sanders,

0:01:00.560 --> 0:01:04.440
<v Speaker 4>Alexandria Kasia Cortez and the Struggle Free New American Politics.

0:01:04.440 --> 0:01:06.440
<v Speaker 2>All right, Josh, great to have you here. Josh joining

0:01:06.480 --> 0:01:09.760
<v Speaker 2>us from our Bloomberg Washington DC bureau. Hey, Josh, first step,

0:01:09.840 --> 0:01:11.440
<v Speaker 2>I want to ask you about the pick for Treasury

0:01:11.800 --> 0:01:15.080
<v Speaker 2>secretary or the process in the behind the scenes, a

0:01:15.120 --> 0:01:18.080
<v Speaker 2>super important job. Wall Street is watching, the world is watching.

0:01:18.480 --> 0:01:20.119
<v Speaker 2>What are you hearing about this process?

0:01:20.800 --> 0:01:23.120
<v Speaker 5>Yeah? Oh, I put process in quotes.

0:01:23.160 --> 0:01:25.280
<v Speaker 6>First of all, I mean it's turned out into like

0:01:25.319 --> 0:01:28.679
<v Speaker 6>an absolute blood bath, with competing candidates stabbing each other

0:01:28.720 --> 0:01:32.200
<v Speaker 6>in the back. And what you have now is a

0:01:32.240 --> 0:01:36.120
<v Speaker 6>list of people who are under consideration. Howard Lutnick, Scott Bessant,

0:01:36.760 --> 0:01:39.920
<v Speaker 6>Robert Leitthheiser, the former trade representative. None of them has

0:01:39.959 --> 0:01:42.440
<v Speaker 6>been named. There's a lot of jockey going on behind

0:01:42.480 --> 0:01:45.160
<v Speaker 6>the scenes. Trump himself doesn't seem to be happy with

0:01:45.240 --> 0:01:47.680
<v Speaker 6>any of the candidates, and as we report in Bloomberg,

0:01:48.040 --> 0:01:50.880
<v Speaker 6>he's very unhappy that these fights have spilled out into

0:01:50.920 --> 0:01:54.080
<v Speaker 6>public view. So the latest we're hearing is that Trump

0:01:54.200 --> 0:01:57.800
<v Speaker 6>is sort of casting about for somebody who would fill

0:01:57.840 --> 0:02:00.440
<v Speaker 6>what he thinks is the role of Treasury attacker, meaning

0:02:00.440 --> 0:02:04.040
<v Speaker 6>somebody big, powerful, respected by Wall Street. Some of the

0:02:04.120 --> 0:02:07.360
<v Speaker 6>names we're hearing and have reported Mark Rowan of Apollo,

0:02:08.080 --> 0:02:11.480
<v Speaker 6>Kevin Walsh, the former Fed governor. There are other dark

0:02:11.520 --> 0:02:13.960
<v Speaker 6>horse names floating around, but right now everybody in Washington's

0:02:13.960 --> 0:02:16.320
<v Speaker 6>trying to figure out, you know, where where the musical

0:02:16.400 --> 0:02:18.320
<v Speaker 6>chairs will stop and who will wind up in that

0:02:18.480 --> 0:02:19.400
<v Speaker 6>very important position.

0:02:19.560 --> 0:02:21.480
<v Speaker 4>Is it hard to find somebody who's respected by Wall

0:02:21.520 --> 0:02:23.799
<v Speaker 4>Street but also believes what Donald Trump believes when it

0:02:23.840 --> 0:02:25.800
<v Speaker 4>comes to tariff's Josh, yeah, I.

0:02:25.760 --> 0:02:28.360
<v Speaker 6>Think that's exactly the tension is. You can Trump can

0:02:28.480 --> 0:02:31.480
<v Speaker 6>certainly find someone like a Lighthiveser who really believes in

0:02:31.520 --> 0:02:33.800
<v Speaker 6>the use of tariffs. But as a number of sources

0:02:33.840 --> 0:02:36.840
<v Speaker 6>told us, wall Street would would would panic if somebody

0:02:36.840 --> 0:02:39.440
<v Speaker 6>who was seen as too extreme on tariffs gets in there.

0:02:39.639 --> 0:02:42.240
<v Speaker 6>On the other hand, you have guys with stirling reputations

0:02:42.280 --> 0:02:45.079
<v Speaker 6>who would be embraced I think by wall Street both

0:02:45.080 --> 0:02:48.160
<v Speaker 6>a warsh or a best and somebody like that who

0:02:48.200 --> 0:02:51.160
<v Speaker 6>may not be as willing to come out and embrace,

0:02:51.360 --> 0:02:56.440
<v Speaker 6>embrace a steep tariff regime of the type that Trumps

0:02:56.600 --> 0:02:59.720
<v Speaker 6>has bandied about, knowing that the damage that that could

0:02:59.720 --> 0:03:03.120
<v Speaker 6>potentally caused to markets if they were implemented, you know,

0:03:03.160 --> 0:03:05.360
<v Speaker 6>and disrupted a lot of things in the global markets.

0:03:05.480 --> 0:03:08.280
<v Speaker 6>So it's tough to find just the right candidate who

0:03:08.280 --> 0:03:11.720
<v Speaker 6>has both the stature, the wealth, the name that Trump wants,

0:03:11.960 --> 0:03:14.160
<v Speaker 6>and also the willingness to do Trump's bidding.

0:03:15.200 --> 0:03:17.480
<v Speaker 2>Hey, Josh, we have not had a chance to talk

0:03:17.480 --> 0:03:20.079
<v Speaker 2>to you about the election outcome. You really wrote the

0:03:20.120 --> 0:03:23.520
<v Speaker 2>book An Understanding Donald Trump's first run at the White

0:03:23.520 --> 0:03:26.600
<v Speaker 2>House and his win that time around. What do you

0:03:26.639 --> 0:03:30.800
<v Speaker 2>make of him running a winning excuse me, a second term?

0:03:31.560 --> 0:03:31.720
<v Speaker 5>Well?

0:03:31.760 --> 0:03:33.239
<v Speaker 6>Yeah, I think it was a surprise to a lot

0:03:33.240 --> 0:03:34.840
<v Speaker 6>of people, but in a lot of ways, it's a

0:03:34.920 --> 0:03:38.040
<v Speaker 6>much more impressive victory than his win in twenty sixteen,

0:03:38.040 --> 0:03:40.440
<v Speaker 6>which took a lot of people by surprise. He did

0:03:40.440 --> 0:03:43.840
<v Speaker 6>not win a majority of the popular vote that time.

0:03:44.120 --> 0:03:46.560
<v Speaker 6>Looks almost certain that he will this time. And I

0:03:46.560 --> 0:03:49.119
<v Speaker 6>think what's most important is the coalition that Trump put

0:03:49.120 --> 0:03:52.240
<v Speaker 6>together and winning the twenty twenty four election. There were

0:03:52.320 --> 0:03:56.080
<v Speaker 6>both the kind of high wattage billionaire supporters, people like

0:03:56.120 --> 0:03:58.560
<v Speaker 6>Howard lutt Nick and Elon Musk, But on the other hand,

0:03:58.600 --> 0:04:03.119
<v Speaker 6>Trump cobbled together a really racially diverse, working class coalition

0:04:03.160 --> 0:04:05.440
<v Speaker 6>that we hadn't seen the last time around. A lot

0:04:05.480 --> 0:04:09.680
<v Speaker 6>of voters that traditionally vote Democrat were persuaded to come

0:04:09.720 --> 0:04:12.120
<v Speaker 6>over and vote for Trump, and as a result, he

0:04:12.200 --> 0:04:15.040
<v Speaker 6>has a really big coalition. As I write about in

0:04:15.080 --> 0:04:18.560
<v Speaker 6>the new issue of BusinessWeek, Trump has pursued this kind

0:04:18.560 --> 0:04:20.800
<v Speaker 6>of what I call plutocratic populism, and I think the

0:04:20.839 --> 0:04:23.640
<v Speaker 6>main tension in his second presidency is going to be

0:04:23.640 --> 0:04:26.359
<v Speaker 6>how to balance the interests of working class people with

0:04:26.480 --> 0:04:29.720
<v Speaker 6>the interests of the billionaire and Wall Street crowd, who

0:04:29.760 --> 0:04:31.159
<v Speaker 6>are another important coalition form.

0:04:31.360 --> 0:04:33.080
<v Speaker 4>So let's talk a little bit about that, Josh. Because

0:04:33.080 --> 0:04:35.440
<v Speaker 4>you came with receipts, you have the numbers here. Why

0:04:35.520 --> 0:04:38.200
<v Speaker 4>is that an impossible task? Why is he unable to

0:04:38.240 --> 0:04:40.280
<v Speaker 4>do that and make good on really every promise that

0:04:40.320 --> 0:04:41.400
<v Speaker 4>he made on the campaign trail.

0:04:42.480 --> 0:04:44.400
<v Speaker 6>Well, if you look at exit poll numbers and just

0:04:44.440 --> 0:04:47.719
<v Speaker 6>in my own interviews with undecided voters and people were

0:04:47.760 --> 0:04:51.000
<v Speaker 6>Trump supporters, a lot of what drove Trump's support was

0:04:51.240 --> 0:04:55.359
<v Speaker 6>voter anger, especially working class voter anger over inflation high prices,

0:04:56.040 --> 0:04:59.360
<v Speaker 6>for which they blamed Kamala Harris personally. They didn't want

0:04:59.400 --> 0:05:01.839
<v Speaker 6>her back in that y. They remember the Trump era,

0:05:01.960 --> 0:05:08.160
<v Speaker 6>rightly or wrongly, as a time of lower prices, lower inflation,

0:05:08.880 --> 0:05:11.599
<v Speaker 6>strong paychecks for everybody, and so they voted for Trump

0:05:12.200 --> 0:05:14.159
<v Speaker 6>in the hopes that he would bring that back. But

0:05:14.240 --> 0:05:16.720
<v Speaker 6>if you look at what some of Trump is planning

0:05:16.720 --> 0:05:18.760
<v Speaker 6>to do, you know, the first item on his agenda

0:05:18.800 --> 0:05:22.000
<v Speaker 6>looks to be extending his twenty seventeen tax cuts and

0:05:22.040 --> 0:05:24.919
<v Speaker 6>maybe even cutting corporate taxes deeper than he did the

0:05:24.960 --> 0:05:28.320
<v Speaker 6>first time around, which would be very exciting to his

0:05:28.400 --> 0:05:32.719
<v Speaker 6>Wall Street contingent, to his billionaire contingent. But it could

0:05:32.760 --> 0:05:37.800
<v Speaker 6>certainly help exacerbate inflation, as could a steep.

0:05:37.560 --> 0:05:38.320
<v Speaker 5>Round of tariff.

0:05:38.400 --> 0:05:40.560
<v Speaker 6>So on the one hand, you know, you could satisfy

0:05:40.600 --> 0:05:43.480
<v Speaker 6>one half of the coalition, But if the cost of

0:05:43.480 --> 0:05:47.320
<v Speaker 6>that was for prices, inflation, and interest rates to rise again,

0:05:47.600 --> 0:05:49.640
<v Speaker 6>then a lot of the same working class voters who

0:05:49.680 --> 0:05:53.160
<v Speaker 6>supported him two weeks ago could potentially turn on him

0:05:53.160 --> 0:05:55.960
<v Speaker 6>and Republicans in the midterm elections and handpower back to

0:05:56.000 --> 0:05:56.640
<v Speaker 6>the Democrats.

0:05:56.680 --> 0:05:59.400
<v Speaker 2>Hey, how much do you think, though Donald J. Trump

0:05:59.440 --> 0:06:01.760
<v Speaker 2>thinks about the midterms at this point? All right?

0:06:01.800 --> 0:06:05.000
<v Speaker 3>I mean essentially, right, this is his second term, he's

0:06:05.000 --> 0:06:06.080
<v Speaker 3>a lame duck president.

0:06:06.400 --> 0:06:08.120
<v Speaker 2>He can do a lot of stuff, and he's got

0:06:08.120 --> 0:06:11.159
<v Speaker 2>a Congress, But how much do you think he thinks

0:06:11.200 --> 0:06:14.600
<v Speaker 2>about what happens at midterms versus following through on his mandate?

0:06:15.240 --> 0:06:16.360
<v Speaker 5>It's a great question, Carrol.

0:06:16.360 --> 0:06:19.000
<v Speaker 6>It's one I've asked to some people around him, and

0:06:19.040 --> 0:06:21.280
<v Speaker 6>the truthful answer I got is he doesn't really care

0:06:21.320 --> 0:06:24.080
<v Speaker 6>at all. What he cares about is this approval rating.

0:06:24.360 --> 0:06:27.160
<v Speaker 6>He'd like to have a booming stock market the way

0:06:27.200 --> 0:06:29.919
<v Speaker 6>he did in his first term, and so part of

0:06:29.920 --> 0:06:32.479
<v Speaker 6>the thinking in Trump world is that even if he

0:06:32.560 --> 0:06:35.599
<v Speaker 6>did promote someone a Treasury secretary who got behind this

0:06:35.720 --> 0:06:39.560
<v Speaker 6>tariff regime and things went badly in the economy, if

0:06:39.600 --> 0:06:43.000
<v Speaker 6>the market were to fall, that might be a kind

0:06:43.000 --> 0:06:46.040
<v Speaker 6>of disciplining mechanism for Trump to step back a little bit,

0:06:46.040 --> 0:06:48.240
<v Speaker 6>because he really does view the stock market, the S

0:06:48.320 --> 0:06:51.359
<v Speaker 6>and P as a kind of verdict on the success

0:06:51.440 --> 0:06:55.920
<v Speaker 6>or failure of his presidency. But certainly, thinking about the

0:06:55.920 --> 0:07:00.440
<v Speaker 6>fortunes of congressional Republicans in twenty twenty six probably not

0:07:00.480 --> 0:07:02.440
<v Speaker 6>top of mind for Donald Trump right now.

0:07:02.480 --> 0:07:04.400
<v Speaker 5>That's interesting to hear. Why do you think that is?

0:07:04.600 --> 0:07:08.320
<v Speaker 4>Because it sort of does provide, to a certain extent,

0:07:08.600 --> 0:07:10.840
<v Speaker 4>a check on what he's able to do, Because if

0:07:10.840 --> 0:07:14.320
<v Speaker 4>he puts policies into place that are unpopular among his base,

0:07:14.360 --> 0:07:16.880
<v Speaker 4>then he could really pay a price in the midterms.

0:07:17.960 --> 0:07:18.520
<v Speaker 5>Yeah, he could.

0:07:18.520 --> 0:07:20.280
<v Speaker 6>I mean, I've gotten a couple answers from that in

0:07:20.320 --> 0:07:23.080
<v Speaker 6>my reporting. One is that Trump simply does not believe

0:07:23.120 --> 0:07:25.840
<v Speaker 6>what most mainstream economists believe, and that is that tariffs

0:07:25.920 --> 0:07:28.480
<v Speaker 6>are inflationary and the cost will be passed along to

0:07:28.520 --> 0:07:31.640
<v Speaker 6>consumers in the form of higher prices. I and my

0:07:31.720 --> 0:07:33.840
<v Speaker 6>Business We colleagues got to ask Trump about that for

0:07:33.840 --> 0:07:36.840
<v Speaker 6>a Business We Cover story cover interview we did with

0:07:36.920 --> 0:07:40.720
<v Speaker 6>Donald Trump back in July at mar A Lago, and

0:07:40.760 --> 0:07:43.600
<v Speaker 6>he simply disagrees. He said, well, if tariffs were inflationary,

0:07:44.120 --> 0:07:47.760
<v Speaker 6>we would have had inflation during my first presidency when

0:07:47.760 --> 0:07:50.640
<v Speaker 6>I imposed rounds of tariffs, and we didn't, and therefore

0:07:50.720 --> 0:07:51.240
<v Speaker 6>it's not going.

0:07:51.240 --> 0:07:52.080
<v Speaker 5>To be a problem.

0:07:52.200 --> 0:07:56.040
<v Speaker 6>A lot of people around Trump publicly surrogates, have taken

0:07:56.080 --> 0:07:59.320
<v Speaker 6>to echoing those points. So, as one of my sources

0:07:59.320 --> 0:08:01.600
<v Speaker 6>pointed out to me in my current Business Week story,

0:08:01.760 --> 0:08:05.440
<v Speaker 6>Trump doesn't believe that tariffs are inflationary. Therefore he's not

0:08:05.560 --> 0:08:08.000
<v Speaker 6>going to believe it until they're implemented and until we

0:08:08.040 --> 0:08:11.560
<v Speaker 6>see inflation. So to me, that suggests that we may

0:08:11.560 --> 0:08:14.840
<v Speaker 6>be in for a rocky ride financially economically over the

0:08:14.840 --> 0:08:17.000
<v Speaker 6>next four years if Trump is able to go ahead

0:08:17.520 --> 0:08:19.480
<v Speaker 6>and do what he says he's going to do. And

0:08:19.560 --> 0:08:23.160
<v Speaker 6>there are fewer guardrails and fewer breaks with Republicans controlling

0:08:23.200 --> 0:08:26.120
<v Speaker 6>all three branches of Congress now than there were last

0:08:26.120 --> 0:08:29.120
<v Speaker 6>time around. So I think I think his theories on

0:08:29.160 --> 0:08:31.480
<v Speaker 6>tariffs and everything else make it a real test run.

0:08:32.480 --> 0:08:36.560
<v Speaker 2>I also do wonder, Josh, do you think Donald Trump

0:08:36.600 --> 0:08:40.720
<v Speaker 2>thinks about his legacy? You know two assassination tempts, you know,

0:08:40.800 --> 0:08:44.480
<v Speaker 2>one that we you know, obviously more serious it seems,

0:08:44.520 --> 0:08:46.839
<v Speaker 2>in certainly than the other one. But I do wonder

0:08:46.840 --> 0:08:49.280
<v Speaker 2>if he's an older man, right, we all get older,

0:08:49.280 --> 0:08:51.320
<v Speaker 2>we start to think about kind of our life's impact.

0:08:51.440 --> 0:08:54.240
<v Speaker 2>Is this your understanding of him?

0:08:54.960 --> 0:08:56.520
<v Speaker 3>You think he's thinking about that?

0:08:56.960 --> 0:08:59.200
<v Speaker 6>In this second, I'll say this, I'll say that you know,

0:08:59.440 --> 0:09:01.960
<v Speaker 6>he and I have I've never had that discussion. But

0:09:02.040 --> 0:09:04.520
<v Speaker 6>from everything I've seen from him, from everything I've heard

0:09:04.559 --> 0:09:07.800
<v Speaker 6>from people around him, Trump tends to live in the

0:09:07.840 --> 0:09:11.920
<v Speaker 6>here and now. I mean he is responsive to the

0:09:11.960 --> 0:09:15.200
<v Speaker 6>cable chirons that he sees on TV. He's responsive to

0:09:16.120 --> 0:09:19.120
<v Speaker 6>the closing price in the stock market. He's responsive to,

0:09:19.440 --> 0:09:22.000
<v Speaker 6>you know, whether or not the Justice Department is going

0:09:22.040 --> 0:09:23.560
<v Speaker 6>to convict him and send him to jail. Which it

0:09:23.559 --> 0:09:26.480
<v Speaker 6>doesn't look what they are now, not so much thinking

0:09:26.559 --> 0:09:29.760
<v Speaker 6>about how his obituary will look in the New York Times.

0:09:30.320 --> 0:09:32.680
<v Speaker 6>But that being said, look, all presidents like to succeed.

0:09:33.160 --> 0:09:35.880
<v Speaker 6>I'm sure Trump would like high approval numbers and a

0:09:35.920 --> 0:09:38.760
<v Speaker 6>lot of the signifiers that Trump looks to for validation,

0:09:38.960 --> 0:09:42.200
<v Speaker 6>things like the level of the stock market, the wealth

0:09:42.240 --> 0:09:44.920
<v Speaker 6>of the United States, the trade deficit. Those are all

0:09:44.920 --> 0:09:47.040
<v Speaker 6>measuring sticks that I think Trump is going to use

0:09:47.080 --> 0:09:49.960
<v Speaker 6>to measure his own performance. And we'll have to see

0:09:49.960 --> 0:09:52.680
<v Speaker 6>if he can get those boosted along the lines that

0:09:52.720 --> 0:09:55.760
<v Speaker 6>I know he wants to based on the policies that

0:09:55.920 --> 0:09:57.839
<v Speaker 6>he said he's going to pursue, and if he can

0:09:57.880 --> 0:10:02.000
<v Speaker 6>do it without breaking apart that broad coalition of both

0:10:02.080 --> 0:10:04.760
<v Speaker 6>Wall Street folks and working class folks that got him

0:10:04.800 --> 0:10:05.880
<v Speaker 6>elected on November.

0:10:05.600 --> 0:10:08.640
<v Speaker 4>Fifth, Josh to speaking of policies, do you believe that

0:10:08.920 --> 0:10:10.760
<v Speaker 4>he will actually make good based on the folks you

0:10:10.800 --> 0:10:13.360
<v Speaker 4>talk to of deporting millions of people who are here

0:10:13.400 --> 0:10:14.600
<v Speaker 4>illegally on day one.

0:10:15.800 --> 0:10:18.880
<v Speaker 6>He's certainly shown every sign that he intends to do that,

0:10:18.960 --> 0:10:22.440
<v Speaker 6>both from the people he's put in top level positions,

0:10:22.440 --> 0:10:25.320
<v Speaker 6>people like Stephen Miller and Tom Holmans, that would lead

0:10:25.320 --> 0:10:27.160
<v Speaker 6>that effort to some of the comments he's made more

0:10:27.200 --> 0:10:31.920
<v Speaker 6>recently about being willing to deputize US law enforcement to

0:10:32.000 --> 0:10:35.360
<v Speaker 6>help carry out this deportation. So, everything we've seen so

0:10:35.440 --> 0:10:37.800
<v Speaker 6>far suggests that yes, Trump is very serious about that

0:10:37.840 --> 0:10:39.400
<v Speaker 6>and intends to pursue it as president.

0:10:39.520 --> 0:10:41.400
<v Speaker 2>Hey, just thirty seconds here to wrap up, and you've

0:10:41.400 --> 0:10:44.439
<v Speaker 2>wrap up your piece. I mean, Donald Trump may also

0:10:44.720 --> 0:10:47.880
<v Speaker 2>just be lucky in terms of timing right policies put

0:10:47.880 --> 0:10:50.520
<v Speaker 2>in place by the Body administration. He may reap the

0:10:50.559 --> 0:10:51.680
<v Speaker 2>benefits up just quickly.

0:10:52.400 --> 0:10:52.840
<v Speaker 5>Yeah. I mean.

0:10:53.080 --> 0:10:55.199
<v Speaker 6>The thing that galls so many Biden people and so

0:10:55.240 --> 0:10:58.480
<v Speaker 6>many Democratic sources is look at the economy Joe Biden

0:10:58.520 --> 0:11:01.960
<v Speaker 6>has bequeathed Donald Trump. Inflation coming down, the stock market

0:11:02.000 --> 0:11:04.680
<v Speaker 6>is at record highs. We have all these new jobs

0:11:04.679 --> 0:11:08.040
<v Speaker 6>in manufacturing factories being built all across the country with

0:11:08.160 --> 0:11:10.880
<v Speaker 6>money that Biden really helped put in place. And now

0:11:10.920 --> 0:11:13.880
<v Speaker 6>Donald Trump is about to take over as president and

0:11:13.960 --> 0:11:17.840
<v Speaker 6>reap the political benefits and credit for all of those things.

0:11:18.880 --> 0:11:21.559
<v Speaker 6>Great timing for Donald Trump, not so great timing for

0:11:21.640 --> 0:11:22.079
<v Speaker 6>Joe Biden.

0:11:22.120 --> 0:11:25.320
<v Speaker 3>Sowa's bat timing, isn't it all right? Josh Green? Good stuff?

0:11:25.360 --> 0:11:25.680
<v Speaker 3>Thank you?

0:11:25.679 --> 0:11:29.240
<v Speaker 2>Thank you, Bloomberg BusinessWeek National correspondent. Check out his story

0:11:29.320 --> 0:11:31.760
<v Speaker 2>on the Bloomberg and at Bloomberg dot com slash BusinessWeek.

0:11:32.960 --> 0:11:36.480
<v Speaker 1>You're listening to the Bloomberg Business Week podcast. Catch US

0:11:36.520 --> 0:11:39.760
<v Speaker 1>Live weekday afternoons from two to five pm Eastern. Listen

0:11:39.800 --> 0:11:41.959
<v Speaker 1>on Apple card Play and then brought auto with a

0:11:41.960 --> 0:11:45.000
<v Speaker 1>Bloomberg Business app, or watch US Live on YouTube.

0:11:46.760 --> 0:11:47.319
<v Speaker 5>Robert F.

0:11:47.440 --> 0:11:50.719
<v Speaker 2>Kennedy Junior's selection to service President like Donald Trump's top

0:11:50.760 --> 0:11:54.520
<v Speaker 2>health official, is prompting questions from policy watchers over how

0:11:54.559 --> 0:11:57.280
<v Speaker 2>the pick will handle the range of health and really

0:11:57.360 --> 0:12:00.000
<v Speaker 2>key health policies that would fall under his per.

0:12:00.600 --> 0:12:03.480
<v Speaker 4>He's an environmental lawyer and vocal vaccine skeptic. He's publicly

0:12:03.520 --> 0:12:07.280
<v Speaker 4>taken positions against food additives and immunization recommendations, but the

0:12:07.360 --> 0:12:09.480
<v Speaker 4>nominee for Secretary of the US Department of Health and

0:12:09.520 --> 0:12:12.240
<v Speaker 4>Human Services has been relatively quiet on many of the

0:12:12.280 --> 0:12:15.920
<v Speaker 4>other issues he would oversee while leading thirteen supporting agencies

0:12:15.960 --> 0:12:18.800
<v Speaker 4>in more than eighty thousand federal employees. So let's get

0:12:18.800 --> 0:12:21.079
<v Speaker 4>to the interview we got with US doctor Paul Offitt,

0:12:21.160 --> 0:12:23.760
<v Speaker 4>director of the Vaccine Education Center at the Children's Hospital

0:12:23.760 --> 0:12:26.679
<v Speaker 4>of Philadelphia, who joins us from Philadelphia.

0:12:27.440 --> 0:12:28.560
<v Speaker 5>Doctor, good to have you with us.

0:12:28.559 --> 0:12:32.280
<v Speaker 4>How might RFK Junior impact healthcare, food, medical research and

0:12:32.360 --> 0:12:33.640
<v Speaker 4>more here in the US.

0:12:35.440 --> 0:12:38.040
<v Speaker 7>He is a very long anti vaccine activist. He is

0:12:38.080 --> 0:12:41.040
<v Speaker 7>a science denialist, and he is a conspiracy theorist. This

0:12:41.200 --> 0:12:43.079
<v Speaker 7>is not the kind of person you want to head

0:12:43.160 --> 0:12:45.760
<v Speaker 7>health agencies. I mean he has said that no vaccine

0:12:45.800 --> 0:12:48.559
<v Speaker 7>is a benefit. He has said that the polio vaccine

0:12:48.920 --> 0:12:51.960
<v Speaker 7>killed more people than it ever saved. He thinks that

0:12:52.240 --> 0:12:55.520
<v Speaker 7>HIV human and deficiency virus is not the cause of AIDS.

0:12:55.559 --> 0:12:59.040
<v Speaker 7>He's an AIGs denialist. He thinks we should drink raw milk,

0:12:59.080 --> 0:13:01.079
<v Speaker 7>which will put us one once again in a position

0:13:01.120 --> 0:13:04.440
<v Speaker 7>of risking things like campelo bacer and he call I

0:13:04.520 --> 0:13:08.400
<v Speaker 7>in salmonella. He thinks that the SARS virus was created

0:13:08.440 --> 0:13:12.640
<v Speaker 7>in the laboratory and specifically designed to spare Ashkenazi Jews

0:13:12.640 --> 0:13:15.400
<v Speaker 7>in Chinese and target whites and blacks. I mean, this

0:13:15.559 --> 0:13:17.559
<v Speaker 7>is the man you want to head health agencies.

0:13:18.040 --> 0:13:18.520
<v Speaker 5>I don't think.

0:13:18.559 --> 0:13:22.760
<v Speaker 3>So what scares you the most, Well, what scares.

0:13:22.480 --> 0:13:24.840
<v Speaker 7>Me the most is is that that he now has

0:13:25.080 --> 0:13:29.080
<v Speaker 7>has a bigger platform to be anti vaccine. So I

0:13:29.080 --> 0:13:31.600
<v Speaker 7>mean He's always had a platform owing to the famous name,

0:13:31.720 --> 0:13:34.480
<v Speaker 7>but now that he's even considered for this position gives

0:13:34.520 --> 0:13:37.480
<v Speaker 7>him a certain level of credibility, which he certainly doesn't deserve.

0:13:37.760 --> 0:13:41.040
<v Speaker 7>Let's suppose you have a vaccine that is submitted to

0:13:41.080 --> 0:13:44.320
<v Speaker 7>the FDA for licensure, and it's it's excellent, and it's

0:13:44.400 --> 0:13:46.959
<v Speaker 7>better than what we've had. I think, you know, say

0:13:47.000 --> 0:13:49.360
<v Speaker 7>I'm on the FDA Vaccine Devisory Committee. Let's say that

0:13:49.400 --> 0:13:52.440
<v Speaker 7>we recommend a licensure, and then the FDA considers that

0:13:52.480 --> 0:13:55.520
<v Speaker 7>recommendation and degrees he could say, no, I think there

0:13:55.559 --> 0:13:58.280
<v Speaker 7>needs to be more study. Similarly, he could could try

0:13:58.320 --> 0:14:02.880
<v Speaker 7>and strip away the the CDC's capacity to recommend vaccines.

0:14:03.040 --> 0:14:05.640
<v Speaker 7>He could take the advisory committees to both those agencies

0:14:05.720 --> 0:14:08.280
<v Speaker 7>FDA and CDC and try and stock it with people

0:14:08.320 --> 0:14:12.240
<v Speaker 7>who are similarly like minded science denialists, such as himself.

0:14:12.480 --> 0:14:15.400
<v Speaker 7>I don't understand this. And when he talks about, for example,

0:14:15.679 --> 0:14:17.800
<v Speaker 7>something that makes sense, which is trying to make our

0:14:17.800 --> 0:14:21.680
<v Speaker 7>country healthier, decrease obesity, decrease type two diabetes and the

0:14:21.720 --> 0:14:24.960
<v Speaker 7>consequences of those disorders such as strokes and heart attacks,

0:14:25.000 --> 0:14:27.400
<v Speaker 7>I'm all for that. Great idea. But there are a

0:14:27.480 --> 0:14:29.600
<v Speaker 7>lot of people out there who could do that job

0:14:29.680 --> 0:14:32.320
<v Speaker 7>much better than he can given his science denialism.

0:14:32.680 --> 0:14:35.640
<v Speaker 2>Doctor offittt on vaccine specifically, Robert F. Kennedy, as you know,

0:14:35.680 --> 0:14:38.720
<v Speaker 2>has often been referred to as a vaccine skeptic. You

0:14:38.760 --> 0:14:40.440
<v Speaker 2>call yourself a vaccine skeptic.

0:14:40.480 --> 0:14:41.240
<v Speaker 3>What's the difference.

0:14:43.200 --> 0:14:45.240
<v Speaker 7>A skeptic is somebody who says, prove it to me,

0:14:45.800 --> 0:14:48.080
<v Speaker 7>show me you're right. So when we sit around the

0:14:48.080 --> 0:14:50.920
<v Speaker 7>table at the FDA Vaccine Advisor Committee and consider vaccines,

0:14:50.920 --> 0:14:52.920
<v Speaker 7>as we did for the COVID vaccines, for example, in

0:14:52.960 --> 0:14:55.960
<v Speaker 7>December of twenty twenty, show us the data, prove that

0:14:56.040 --> 0:14:58.360
<v Speaker 7>it's effective, prove that it's safe, so that we can

0:14:58.400 --> 0:15:02.200
<v Speaker 7>then recommend it in good conscience. That's skepticisms. Skepticism is healthy.

0:15:02.520 --> 0:15:05.280
<v Speaker 7>He's a cynic. He's a vaccine cynic. He doesn't believe

0:15:05.320 --> 0:15:07.960
<v Speaker 7>the data. He thinks that there are dark, evil forces

0:15:08.040 --> 0:15:11.920
<v Speaker 7>working behind the scenes that are misrepresenting data. What he

0:15:11.960 --> 0:15:13.680
<v Speaker 7>doesn't realize is that there.

0:15:13.600 --> 0:15:14.320
<v Speaker 5>Is no hiding.

0:15:14.400 --> 0:15:17.840
<v Speaker 7>Even a farm pharmacytical company misrepresented data on safety or

0:15:17.840 --> 0:15:20.680
<v Speaker 7>efficacy that will soon be found out because there are

0:15:20.720 --> 0:15:23.120
<v Speaker 7>post marketing studies like that can be done by the

0:15:23.160 --> 0:15:25.640
<v Speaker 7>Vaccine Safety Data Link, where you'll know if there's a

0:15:25.680 --> 0:15:29.000
<v Speaker 7>problem immediately. There is no hiding, so his whole premise

0:15:29.080 --> 0:15:29.480
<v Speaker 7>is wrong.

0:15:29.800 --> 0:15:32.760
<v Speaker 4>One thing that I've been wondering is how different are

0:15:32.760 --> 0:15:36.040
<v Speaker 4>we than other developed countries or other wealthy countries when

0:15:36.040 --> 0:15:37.960
<v Speaker 4>it comes to vaccine schedules.

0:15:38.000 --> 0:15:38.360
<v Speaker 5>Doctor?

0:15:39.000 --> 0:15:42.520
<v Speaker 4>Do we do things differently than other countries around the world.

0:15:43.840 --> 0:15:47.080
<v Speaker 7>We tend to recommend more vaccines than most other countries. So,

0:15:47.160 --> 0:15:49.640
<v Speaker 7>for example, the chicken pox vaccine, which came onto the

0:15:49.640 --> 0:15:52.160
<v Speaker 7>market in nineteen ninety five is not used in a

0:15:52.200 --> 0:15:55.120
<v Speaker 7>number of developed world countries. They're willing to have children

0:15:55.240 --> 0:15:58.200
<v Speaker 7>suffer tricken pox. In this country, obviously, there would be

0:15:58.240 --> 0:15:59.960
<v Speaker 7>millions of cases of chicken pox a year, and there

0:16:00.160 --> 0:16:04.520
<v Speaker 7>be about about seventy five two hundred people who would

0:16:04.560 --> 0:16:06.080
<v Speaker 7>die off chicken pox, and there would be tens of

0:16:06.080 --> 0:16:10.280
<v Speaker 7>thousands of hospitalizations. So we thought that was worth eliminating.

0:16:10.440 --> 0:16:12.920
<v Speaker 7>But you know, not all countries felt the same way.

0:16:13.040 --> 0:16:15.840
<v Speaker 4>Other than that, though, are there aren't big differences?

0:16:16.960 --> 0:16:17.920
<v Speaker 5>No? No, For the most.

0:16:17.720 --> 0:16:21.640
<v Speaker 7>Part, the developed world doesn't like children, so we would.

0:16:20.280 --> 0:16:23.280
<v Speaker 4>So if you did over end up overseeing the CDC

0:16:23.320 --> 0:16:25.640
<v Speaker 4>and changing the recommendations we'd be an outlier in this

0:16:25.680 --> 0:16:28.960
<v Speaker 4>country based on some of the recommendtions that he could make.

0:16:30.640 --> 0:16:36.000
<v Speaker 7>Right, I think his fanatical anti vaccine activismsm has already

0:16:36.080 --> 0:16:38.920
<v Speaker 7>scared people. I mean, if you look, for example, over

0:16:38.960 --> 0:16:41.680
<v Speaker 7>the last few years, our number of cases of measles

0:16:41.480 --> 0:16:44.960
<v Speaker 7>have increased dramatically. Last year we had three thousand cases

0:16:45.000 --> 0:16:47.680
<v Speaker 7>of protesterler hooping cough. This year we have seventeen thousand.

0:16:47.880 --> 0:16:50.640
<v Speaker 7>We've had more than two hundred children less than eighteen

0:16:50.680 --> 0:16:53.320
<v Speaker 7>years of eight dive influenza over the pasture. That's a

0:16:53.400 --> 0:16:56.160
<v Speaker 7>high number. So you're already seeing an erosion in trust,

0:16:56.240 --> 0:16:59.440
<v Speaker 7>already seeing an erosion in vaccine rates among kindergartens, and

0:16:59.480 --> 0:17:01.880
<v Speaker 7>as a content winch, you're seeing an increase in infectious

0:17:01.880 --> 0:17:05.200
<v Speaker 7>diseases that are preventable. It's unconscionable.

0:17:05.440 --> 0:17:06.160
<v Speaker 3>I have to say.

0:17:06.240 --> 0:17:09.640
<v Speaker 2>I have talked with colleagues and friends and associates who

0:17:09.760 --> 0:17:14.720
<v Speaker 2>have autistic children now adults, and who are open to

0:17:14.760 --> 0:17:17.639
<v Speaker 2>the idea that maybe vaccines cause this problem. So like

0:17:17.680 --> 0:17:21.560
<v Speaker 2>there is you know, I've had these discussions. I guess

0:17:21.600 --> 0:17:24.240
<v Speaker 2>what I wonder about, are we going to maybe depending

0:17:24.280 --> 0:17:28.280
<v Speaker 2>on what comes out If RFK is indeed our next

0:17:28.280 --> 0:17:29.920
<v Speaker 2>top health voice.

0:17:29.640 --> 0:17:30.840
<v Speaker 3>Here in the administration.

0:17:31.400 --> 0:17:34.800
<v Speaker 2>That will that potentially lead to maybe some kind of

0:17:34.880 --> 0:17:37.160
<v Speaker 2>ruling or mandate that comes down that says we don't

0:17:37.160 --> 0:17:40.000
<v Speaker 2>believe in vaccines and then are they not covered by insurance? Like,

0:17:40.080 --> 0:17:42.760
<v Speaker 2>how does this potentially play out realistically?

0:17:44.000 --> 0:17:46.280
<v Speaker 7>Right? So, so there's the Vaccine for Children's program which

0:17:46.320 --> 0:17:48.680
<v Speaker 7>was born in the nineteen nineties and the Clinton administration

0:17:48.720 --> 0:17:51.320
<v Speaker 7>which basically covers about half of the vaccines in this

0:17:51.359 --> 0:17:54.440
<v Speaker 7>country for children who are either under insured or uninsured.

0:17:54.600 --> 0:17:56.240
<v Speaker 7>I don't think he could touch that. I mean, that's

0:17:56.280 --> 0:17:58.760
<v Speaker 7>really a congressional program. The Congress would have to agree

0:17:58.800 --> 0:17:58.920
<v Speaker 7>to that.

0:17:58.960 --> 0:18:00.000
<v Speaker 5>I can't imagine that happening.

0:18:00.240 --> 0:18:03.120
<v Speaker 7>He could make it more difficult to get insurance generally

0:18:03.200 --> 0:18:07.120
<v Speaker 7>for vaccines, making them more expensive for the consumer, that's possible.

0:18:07.359 --> 0:18:09.359
<v Speaker 7>I mean, I think he'll do everything he can to

0:18:09.440 --> 0:18:10.399
<v Speaker 7>lessen immunization rate.

0:18:10.640 --> 0:18:11.439
<v Speaker 5>This is what he says.

0:18:11.640 --> 0:18:14.040
<v Speaker 7>I think that, you know, the parents should make decisions

0:18:14.080 --> 0:18:17.600
<v Speaker 7>well with their doctor and basically pull the CCC out

0:18:17.600 --> 0:18:19.640
<v Speaker 7>of it. Let let us look at the real data.

0:18:19.680 --> 0:18:21.399
<v Speaker 7>And he's going to show us the real data because

0:18:21.400 --> 0:18:24.600
<v Speaker 7>only he knows the real data, because he's a conspiracy theorist,

0:18:24.840 --> 0:18:27.639
<v Speaker 7>it's hard to watch. I do think there'll be an

0:18:27.640 --> 0:18:30.840
<v Speaker 7>erosion in vaccine rates and regarding autism, it's fair to

0:18:30.880 --> 0:18:33.480
<v Speaker 7>ask the question, my child was fine, they got a vaccine,

0:18:33.520 --> 0:18:35.960
<v Speaker 7>Now they're not fine. Could the vaccine have done it?

0:18:36.040 --> 0:18:38.560
<v Speaker 7>That's an answerable question, and it's been answered. There's been

0:18:38.640 --> 0:18:42.159
<v Speaker 7>eighteen studies done in seven country on three con instead

0:18:42.160 --> 0:18:46.440
<v Speaker 7>have shown vaccines don't cause autism. It's question asked unanswered.

0:18:46.600 --> 0:18:49.720
<v Speaker 3>Is the medical community, you know, gearing up to fight back.

0:18:51.880 --> 0:18:54.919
<v Speaker 7>Yes, but again, you know we're not good at this stuff.

0:18:54.960 --> 0:18:57.000
<v Speaker 7>I mean I think, well, fight will certainly fight back

0:18:57.000 --> 0:18:58.680
<v Speaker 7>the way we knew how, which is which is to

0:18:58.720 --> 0:19:02.639
<v Speaker 7>try and present all the day that we know supports vaccines.

0:19:02.840 --> 0:19:05.159
<v Speaker 7>But this is really becoming a political issue. So I

0:19:05.200 --> 0:19:07.119
<v Speaker 7>think it's going to have to have a political solution.

0:19:07.400 --> 0:19:10.359
<v Speaker 7>I think we're going to have to find those senators who,

0:19:10.359 --> 0:19:13.600
<v Speaker 7>assuming there is a confirmation hearing, that are reasonable enough

0:19:13.600 --> 0:19:15.200
<v Speaker 7>to say that this is not the guy you want

0:19:15.240 --> 0:19:15.880
<v Speaker 7>in that position.

0:19:16.520 --> 0:19:21.800
<v Speaker 4>So after RFK was announced, the Governor of Colorado, Jared Polish,

0:19:21.920 --> 0:19:24.520
<v Speaker 4>sent a post on accident said he was excited because

0:19:24.520 --> 0:19:26.760
<v Speaker 4>of a vaccine choice and he helped push back in

0:19:27.080 --> 0:19:30.320
<v Speaker 4>Colorado when it came to this particular topic, can you

0:19:30.440 --> 0:19:34.840
<v Speaker 4>share your view as to why it's important for lots

0:19:34.880 --> 0:19:37.639
<v Speaker 4>of people to get vaccines, because if it is a

0:19:37.680 --> 0:19:40.960
<v Speaker 4>parent's choice, and you know that parent chooses to get

0:19:40.960 --> 0:19:44.479
<v Speaker 4>their kid vaccinate against something, it's not necessarily that that

0:19:44.560 --> 0:19:47.360
<v Speaker 4>kid is actually protected if other kids aren't protected.

0:19:48.920 --> 0:19:49.640
<v Speaker 5>Exactly right.

0:19:49.680 --> 0:19:51.479
<v Speaker 7>So if you step on a rusty nail and you

0:19:51.520 --> 0:19:53.080
<v Speaker 7>go to the doctor and you say I don't want

0:19:53.080 --> 0:19:55.560
<v Speaker 7>a tennis vaccine and you get tetanus, no one's going

0:19:55.600 --> 0:19:57.960
<v Speaker 7>to catch tennis from you. It's not a contagious disease.

0:19:58.320 --> 0:20:02.000
<v Speaker 7>Measles is, influenza is, and others are. So a choice

0:20:02.000 --> 0:20:04.760
<v Speaker 7>not to get a vaccine is a choice not only

0:20:04.800 --> 0:20:07.160
<v Speaker 7>for yourself, but for those with whom you come in contact.

0:20:07.320 --> 0:20:09.399
<v Speaker 7>And remember there are about nine million people in this country.

0:20:09.440 --> 0:20:12.639
<v Speaker 7>You can't be vaccinated because they're getting chemotherapy for their

0:20:12.680 --> 0:20:15.720
<v Speaker 7>cancer or immute suppressive therapy for the autoimmune diseases. They

0:20:15.760 --> 0:20:18.040
<v Speaker 7>depend on those around them to protect them. Do we

0:20:18.160 --> 0:20:21.639
<v Speaker 7>have any responsibility for our neighbors? It is hard to

0:20:21.640 --> 0:20:23.480
<v Speaker 7>watch if you look what happened with Stars Kobe two,

0:20:23.920 --> 0:20:28.000
<v Speaker 7>those counties that were generally under vaccinated had much higher

0:20:28.080 --> 0:20:30.560
<v Speaker 7>rates of hospitalization and death than those counties that were

0:20:31.119 --> 0:20:34.160
<v Speaker 7>highly vaccinated, and that affects the people. If you're better

0:20:34.240 --> 0:20:38.160
<v Speaker 7>off actually being unvaccinated living in a highly vaccinated community

0:20:38.240 --> 0:20:41.400
<v Speaker 7>than being vaccinated living in a highly unvaccinated unity.

0:20:41.560 --> 0:20:42.239
<v Speaker 5>That's wild to hear.

0:20:42.280 --> 0:20:45.639
<v Speaker 4>What about the power of states and local municipalities over this?

0:20:45.760 --> 0:20:47.840
<v Speaker 4>For example, I have a kid in the New York

0:20:47.840 --> 0:20:50.159
<v Speaker 4>City public school district and he has to get a

0:20:50.160 --> 0:20:52.160
<v Speaker 4>certain number of vaccines in order to actually be able

0:20:52.240 --> 0:20:55.000
<v Speaker 4>to go to school. That's a way for them to say, Okay,

0:20:55.320 --> 0:20:58.000
<v Speaker 4>well we are making this choice, or for the parent

0:20:58.080 --> 0:21:00.960
<v Speaker 4>to make this choice to vaccine back their kids against

0:21:01.000 --> 0:21:03.480
<v Speaker 4>these things. Isn't their power there at the local level.

0:21:04.600 --> 0:21:06.840
<v Speaker 7>Yeah, Well, mandates are state run. I mean, there's not

0:21:07.000 --> 0:21:10.400
<v Speaker 7>federal mandates. I mean the school vaccine mandates are done

0:21:10.400 --> 0:21:12.879
<v Speaker 7>by states, and different states actually have different vaccines that

0:21:12.960 --> 0:21:15.919
<v Speaker 7>they mandate. But we've had school mandates from the books

0:21:15.920 --> 0:21:19.280
<v Speaker 7>for decades. There was about by nineteen sixty four to five,

0:21:19.320 --> 0:21:23.000
<v Speaker 7>about twenty five schools states had school mandates. By the

0:21:23.040 --> 0:21:25.280
<v Speaker 7>mid seventies, that went up to forty by nineteen eighty one,

0:21:25.320 --> 0:21:28.440
<v Speaker 7>all fifty states had school vaccine mandates, and with that,

0:21:28.520 --> 0:21:31.200
<v Speaker 7>with the enforcement of school vaccine mandates, we went from

0:21:31.440 --> 0:21:34.240
<v Speaker 7>forty seven thousand cases of measles a year, seventy five

0:21:34.280 --> 0:21:36.760
<v Speaker 7>thousand cases of measles a year, one hundred and fifty

0:21:36.800 --> 0:21:39.479
<v Speaker 7>deaths from measles a year, to eliminating that disease from

0:21:39.520 --> 0:21:41.800
<v Speaker 7>this country by the year two thousand. But it's come

0:21:41.840 --> 0:21:44.399
<v Speaker 7>back in part because the critical percentage of parents are

0:21:44.440 --> 0:21:45.920
<v Speaker 7>choosing not to vaccinate their children.

0:21:46.080 --> 0:21:47.600
<v Speaker 3>Yeah, numbers tell a story.

0:21:47.760 --> 0:21:50.919
<v Speaker 2>Hey, listen, speaking of choice revaccination, You know, we do

0:21:51.000 --> 0:21:55.000
<v Speaker 2>have choices what to eat, We have choices. McDonald's is

0:21:55.480 --> 0:21:57.879
<v Speaker 2>clearly a favorite a president like Donald Trump.

0:21:58.320 --> 0:21:59.040
<v Speaker 3>During the campaign.

0:21:59.040 --> 0:22:01.640
<v Speaker 2>He even helps serve cuss at one restaurant. I got

0:22:01.680 --> 0:22:03.160
<v Speaker 2>to say, I'm a fan of their fries.

0:22:03.480 --> 0:22:04.320
<v Speaker 3>Full disclosure.

0:22:04.440 --> 0:22:06.919
<v Speaker 2>We've seen Donald Trump and RFK Junior and Elon and

0:22:06.960 --> 0:22:09.280
<v Speaker 2>others chowing down on McDonald's together.

0:22:09.400 --> 0:22:11.600
<v Speaker 4>Oh, to be fair, rfk's holding the burger. He's not

0:22:11.680 --> 0:22:12.160
<v Speaker 4>chowing yet.

0:22:12.240 --> 0:22:15.080
<v Speaker 2>Yes, okay, so maybe he's just holding maybe the little

0:22:15.080 --> 0:22:18.120
<v Speaker 2>osmosis going on there. Just got about thirty seconds here.

0:22:18.200 --> 0:22:20.399
<v Speaker 2>I do think about the role of Donald Trump, what

0:22:20.560 --> 0:22:25.080
<v Speaker 2>impact he might have in terms of his thinking about

0:22:25.240 --> 0:22:28.200
<v Speaker 2>health and medical care and all that good stuff. I mean,

0:22:28.240 --> 0:22:29.879
<v Speaker 2>we saw what he did during his first term with

0:22:30.000 --> 0:22:33.280
<v Speaker 2>COVID and getting a vaccine, So how do you think

0:22:33.359 --> 0:22:36.560
<v Speaker 2>his impact might be on what goes on in this area?

0:22:36.560 --> 0:22:38.320
<v Speaker 3>And again, just got about thirty seconds.

0:22:39.080 --> 0:22:39.159
<v Speaker 6>Now.

0:22:39.440 --> 0:22:41.639
<v Speaker 7>I think he's hard to predict Donald Trump. But I

0:22:41.680 --> 0:22:44.080
<v Speaker 7>think that scene though, with him sitting there and Elon

0:22:44.160 --> 0:22:47.160
<v Speaker 7>Musk and RFK Junior and Mike Johnson and others eating

0:22:47.240 --> 0:22:50.159
<v Speaker 7>eating Donald's, I think my take home from a message

0:22:50.160 --> 0:22:53.240
<v Speaker 7>from that scene was Donald Trump telling Robert Kennedy Jr.

0:22:53.560 --> 0:22:57.240
<v Speaker 7>You'll eat what I tell you to.

0:22:57.640 --> 0:22:58.000
<v Speaker 5>I believe.

0:22:58.000 --> 0:23:01.000
<v Speaker 4>Donald Trump Junior retweeted that and said the Make America

0:23:01.040 --> 0:23:02.480
<v Speaker 4>Healthy Again starts tomorrow.

0:23:03.560 --> 0:23:06.320
<v Speaker 2>So I gotta say I love a happy meal as well.

0:23:06.800 --> 0:23:09.840
<v Speaker 2>Doctor Paul Offit, this was a treat a pleasure. Thank

0:23:09.880 --> 0:23:12.159
<v Speaker 2>you so much for finding time for as doctor Paul Offfitt,

0:23:12.160 --> 0:23:17.120
<v Speaker 2>director of the Vaccine Education Center the Children's Hospital of Philadelphia.

0:23:17.400 --> 0:23:21.240
<v Speaker 1>You're listening to the Bloomberg Business Week podcast. Listen live

0:23:21.359 --> 0:23:23.960
<v Speaker 1>each weekday. He's starting at two pm Eastern on Apple

0:23:24.040 --> 0:23:27.040
<v Speaker 1>car Play and Android Auto. With the Bloomberg Business app.

0:23:27.160 --> 0:23:30.000
<v Speaker 1>You can also listen live on Amazon Alexa from our

0:23:30.040 --> 0:23:34.399
<v Speaker 1>flagship New York station, Just say Alexa play Bloomberg eleven thirty.

0:23:35.560 --> 0:23:37.359
<v Speaker 4>Well, we talk a lot about the performance of the

0:23:37.440 --> 0:23:39.679
<v Speaker 4>S and P five hundred and the Nasdaq one hundred.

0:23:39.680 --> 0:23:41.239
<v Speaker 4>By the way, the S and P five hundred up

0:23:41.280 --> 0:23:43.080
<v Speaker 4>more than twenty three percent so far this year, the

0:23:43.160 --> 0:23:45.040
<v Speaker 4>Nasdaq one hundred up more than twenty two percent.

0:23:45.520 --> 0:23:48.159
<v Speaker 5>Large caps and megacaps have done well this year. We

0:23:48.240 --> 0:23:51.040
<v Speaker 5>know that small caps not so much. The RUST two.

0:23:50.880 --> 0:23:54.439
<v Speaker 4>Thousand only up around fourteen percent so far this year. Well,

0:23:54.480 --> 0:23:56.760
<v Speaker 4>Mike Road thinks that could be about to change. He's

0:23:56.800 --> 0:23:59.640
<v Speaker 4>senior investment director at American Century Investments. They've got about

0:24:00.240 --> 0:24:02.760
<v Speaker 4>and sixty billion dollars in assets under management, forty five

0:24:02.800 --> 0:24:06.520
<v Speaker 4>billion of which is invested in actively managed small cap strategies.

0:24:06.800 --> 0:24:10.040
<v Speaker 4>Mike joins us here in the Bloomberg Interactive at Brokers Studio.

0:24:10.320 --> 0:24:10.960
<v Speaker 5>Mike welcome.

0:24:11.080 --> 0:24:11.359
<v Speaker 1>Thanks.

0:24:12.000 --> 0:24:15.120
<v Speaker 4>Single biggest catalyst in your view in the last few

0:24:15.119 --> 0:24:17.880
<v Speaker 4>weeks for small caps or right now for small caps,

0:24:17.880 --> 0:24:18.199
<v Speaker 4>what is it?

0:24:18.280 --> 0:24:21.399
<v Speaker 8>Yeah, it's say the Trump election for sure, and the

0:24:21.440 --> 0:24:21.840
<v Speaker 8>red wave.

0:24:22.040 --> 0:24:22.679
<v Speaker 3>There was an election.

0:24:22.760 --> 0:24:26.600
<v Speaker 8>There was an election breaking news, I think, but that

0:24:26.680 --> 0:24:30.560
<v Speaker 8>really just through fuel on the fire that had already started.

0:24:30.560 --> 0:24:33.240
<v Speaker 8>Around July, you started to see a market rotation towards

0:24:33.240 --> 0:24:37.879
<v Speaker 8>small caps. What you have is expected earnings growth of

0:24:38.000 --> 0:24:41.480
<v Speaker 8>nearly eighteen percent next year. That's higher than midcaps, that's

0:24:41.520 --> 0:24:45.399
<v Speaker 8>higher than large caps. Rather magnificent seven still growing a

0:24:45.480 --> 0:24:48.119
<v Speaker 8>twenty percent plus next year, but that's slowing, whereas you

0:24:48.200 --> 0:24:51.920
<v Speaker 8>have accelerating earnings for small caps, which have actually had

0:24:51.960 --> 0:24:54.720
<v Speaker 8>negative earnings the last two years. So you're coming out

0:24:54.720 --> 0:24:58.159
<v Speaker 8>of a small cap earnings recession and you're getting acceleration

0:24:58.240 --> 0:25:00.200
<v Speaker 8>into next year, and we think that that's to be

0:25:00.240 --> 0:25:01.760
<v Speaker 8>a real growth driver for the ASA class.

0:25:01.840 --> 0:25:03.919
<v Speaker 2>So the expectation what that the US economy is going

0:25:03.960 --> 0:25:07.360
<v Speaker 2>to do better, maybe tariffs push back on foreign imports,

0:25:07.359 --> 0:25:10.080
<v Speaker 2>and so that's good for those smaller cap companies that

0:25:10.160 --> 0:25:12.280
<v Speaker 2>tend to be here in the US focused on the

0:25:12.359 --> 0:25:13.760
<v Speaker 2>US doing work in the US.

0:25:13.840 --> 0:25:14.399
<v Speaker 5>Yeah, exactly.

0:25:14.440 --> 0:25:16.359
<v Speaker 8>So small caps get about eighty percent of the revenue

0:25:16.359 --> 0:25:18.200
<v Speaker 8>from inside the United States. So if you're positive on

0:25:18.240 --> 0:25:20.199
<v Speaker 8>the US, the best way to play that is with

0:25:20.280 --> 0:25:24.000
<v Speaker 8>small caps, and restoring has been a major positive catalyst

0:25:24.119 --> 0:25:28.120
<v Speaker 8>for small caps in terms of again bringing manufacturing back

0:25:28.160 --> 0:25:32.320
<v Speaker 8>to the US, and with Trump getting elected and tariffs

0:25:32.320 --> 0:25:35.200
<v Speaker 8>are likely kicking in. That's probably going to accelerate restoring

0:25:35.359 --> 0:25:37.119
<v Speaker 8>even more, and small caps are the best way to

0:25:37.160 --> 0:25:37.479
<v Speaker 8>play that.

0:25:37.600 --> 0:25:37.760
<v Speaker 1>Mike.

0:25:37.760 --> 0:25:39.520
<v Speaker 2>One thing I wanted to ask you since the election,

0:25:39.760 --> 0:25:41.760
<v Speaker 2>what have you seen in terms of investment flows, Because

0:25:41.800 --> 0:25:44.479
<v Speaker 2>if you look at the russell is up about two

0:25:44.520 --> 0:25:46.800
<v Speaker 2>percent since the election, it's pretty much the same as

0:25:46.800 --> 0:25:47.840
<v Speaker 2>the S and P five hundred.

0:25:47.880 --> 0:25:50.600
<v Speaker 3>Where has money been going into since the outcome?

0:25:50.680 --> 0:25:52.840
<v Speaker 8>Yeah, so there's been about eight billion that's flown in

0:25:53.119 --> 0:25:57.000
<v Speaker 8>float into the small cap etf since November. That's pretty good,

0:25:57.000 --> 0:25:59.760
<v Speaker 8>but you actually saw ten billion in July when the

0:25:59.760 --> 0:26:02.720
<v Speaker 8>thought was that rates where we were starting a kind

0:26:02.720 --> 0:26:05.720
<v Speaker 8>of rate cut cycle. So you still haven't seen it. Now.

0:26:05.720 --> 0:26:07.520
<v Speaker 8>If you look at how large small caps are in

0:26:07.600 --> 0:26:10.160
<v Speaker 8>terms of the percentage of the broader US equity market,

0:26:10.280 --> 0:26:13.920
<v Speaker 8>still less than four percent. That's fifty percent below average,

0:26:14.280 --> 0:26:16.240
<v Speaker 8>and the last time it was this low was the

0:26:16.320 --> 0:26:19.439
<v Speaker 8>nineteen thirties. So small caps have been a forgotten asset

0:26:19.440 --> 0:26:23.320
<v Speaker 8>class institutionally. And you get a lot of agreement that

0:26:23.560 --> 0:26:25.440
<v Speaker 8>small caps are the place to be over the next

0:26:25.440 --> 0:26:27.760
<v Speaker 8>twelve months, but you haven't yet seen the flows.

0:26:28.040 --> 0:26:28.920
<v Speaker 3>I feel like we have.

0:26:28.920 --> 0:26:31.600
<v Speaker 2>Been talking about everyone saying, here's the reason to buy

0:26:31.600 --> 0:26:32.399
<v Speaker 2>small caps for a.

0:26:32.520 --> 0:26:35.200
<v Speaker 5>Long time, say it, yeah's international.

0:26:35.600 --> 0:26:38.960
<v Speaker 2>Yeah, And yet you're saying it's not like everybody's running in.

0:26:39.280 --> 0:26:42.040
<v Speaker 8>Yeah, not yet. But I think that's actually, frankly a

0:26:42.080 --> 0:26:43.680
<v Speaker 8>good thing. It's kind of the empty room. I think

0:26:43.680 --> 0:26:46.840
<v Speaker 8>now is a good time. There's a lot of expectation

0:26:47.119 --> 0:26:49.640
<v Speaker 8>out there for earnings to accelerate next year. I think

0:26:49.680 --> 0:26:52.040
<v Speaker 8>you're going to have to start to see that now.

0:26:52.040 --> 0:26:54.440
<v Speaker 8>I was at a regional bank conference two weeks ago,

0:26:54.560 --> 0:26:55.919
<v Speaker 8>was the day after Trump got elected.

0:26:55.920 --> 0:26:57.760
<v Speaker 3>Digital banks have done really much.

0:26:57.600 --> 0:27:01.199
<v Speaker 8>Better recently after two years of misery. Uh, and the

0:27:01.200 --> 0:27:04.800
<v Speaker 8>CEOs were literally was it literally? But like Jamie Diamond said,

0:27:04.880 --> 0:27:08.040
<v Speaker 8>dancing in the streets right doing the Trump dance because

0:27:08.040 --> 0:27:09.520
<v Speaker 8>they're they're most excited.

0:27:09.280 --> 0:27:11.240
<v Speaker 2>About someone in the newsroom who does the Trump dance

0:27:11.400 --> 0:27:12.040
<v Speaker 2>really well.

0:27:12.119 --> 0:27:13.000
<v Speaker 5>But I'm not gonna try.

0:27:13.080 --> 0:27:13.800
<v Speaker 3>We're going to table that.

0:27:14.640 --> 0:27:18.960
<v Speaker 8>But deregulation is going to really benefit regional banks, and

0:27:19.000 --> 0:27:21.520
<v Speaker 8>regional banks are also a big beneficiary of restoring right

0:27:21.520 --> 0:27:24.680
<v Speaker 8>when these big new projects get started, you need to

0:27:24.960 --> 0:27:27.239
<v Speaker 8>you need funding for those projects, and regional banks are

0:27:27.240 --> 0:27:30.159
<v Speaker 8>really going to drive the growth in these kind of

0:27:30.200 --> 0:27:32.639
<v Speaker 8>mini regional economies around the country.

0:27:32.520 --> 0:27:35.679
<v Speaker 4>Like, what happens if the FED doesn't lower rates to

0:27:35.720 --> 0:27:37.520
<v Speaker 4>the extent that a lot of people think, they, well,

0:27:37.520 --> 0:27:40.240
<v Speaker 4>what happens if inflation doesn't come down to that two percent?

0:27:40.440 --> 0:27:41.080
<v Speaker 5>Crazily?

0:27:41.200 --> 0:27:43.399
<v Speaker 8>Yeah, that is that is the question I think that

0:27:43.560 --> 0:27:45.959
<v Speaker 8>I think you have to ask the next question why? Okay,

0:27:46.040 --> 0:27:48.959
<v Speaker 8>so why and what does the yield curve look like?

0:27:49.000 --> 0:27:52.000
<v Speaker 8>So if we have growth outpacing, if growth it starts

0:27:52.040 --> 0:27:56.160
<v Speaker 8>to accelerate right three percent plus next year in part

0:27:56.240 --> 0:27:59.760
<v Speaker 8>due to Trump's policies, and inflation doesn't come right down

0:27:59.760 --> 0:28:02.080
<v Speaker 8>to two percent, I think that's okay, that's good news

0:28:02.160 --> 0:28:07.720
<v Speaker 8>is good news and growth Trump's no pun intended inflation,

0:28:08.400 --> 0:28:10.040
<v Speaker 8>it's And then the second part of that is more

0:28:10.040 --> 0:28:13.119
<v Speaker 8>about this shape of the yield curve. So, yes, rates

0:28:13.160 --> 0:28:15.320
<v Speaker 8>not be there might not be eight rate cuts next year,

0:28:15.320 --> 0:28:18.080
<v Speaker 8>But if you have a steepening yield curve, that's a

0:28:18.119 --> 0:28:20.720
<v Speaker 8>really good environment for small caps. We had an inverted

0:28:20.960 --> 0:28:23.920
<v Speaker 8>yield curve for two years. That's really tough for banks

0:28:23.920 --> 0:28:26.760
<v Speaker 8>and for other spread type businesses. And as that yield

0:28:26.800 --> 0:28:29.640
<v Speaker 8>curve reinverts, that's just a really good environment. So I'd

0:28:29.640 --> 0:28:31.960
<v Speaker 8>say focus more on the shape of the yield curve

0:28:31.960 --> 0:28:35.199
<v Speaker 8>as opposed to the absolute interest rate number or how

0:28:35.200 --> 0:28:36.560
<v Speaker 8>many how many times the Fed will cut.

0:28:36.640 --> 0:28:38.360
<v Speaker 3>So the flattening out that we've seen in the belly

0:28:38.360 --> 0:28:39.480
<v Speaker 3>of the curve not great.

0:28:40.000 --> 0:28:41.120
<v Speaker 5>Not great, not great.

0:28:41.160 --> 0:28:42.640
<v Speaker 8>But I think if you believe that we're going to

0:28:42.720 --> 0:28:46.080
<v Speaker 8>have an accelerating GDP over the next couple of years

0:28:46.080 --> 0:28:49.040
<v Speaker 8>because of Trump's policy, small caps are the biggest beneficiary

0:28:49.040 --> 0:28:49.240
<v Speaker 8>of that.

0:28:49.360 --> 0:28:51.959
<v Speaker 2>But if we have an accelerating GDP and we have

0:28:52.000 --> 0:28:54.880
<v Speaker 2>too much money back in the economy, which leads to inflation,

0:28:55.080 --> 0:28:57.840
<v Speaker 2>we know from Fitcher jpow we're not quite there yet.

0:28:58.960 --> 0:29:01.160
<v Speaker 2>I do think about the implications of that and the

0:29:01.200 --> 0:29:03.200
<v Speaker 2>impact that they could have on small caps or other sectors.

0:29:03.280 --> 0:29:06.360
<v Speaker 8>Yeah, I think it comes down to that, why do

0:29:06.400 --> 0:29:09.520
<v Speaker 8>we have inflation? Is there too much money flooding the systry?

0:29:09.600 --> 0:29:11.360
<v Speaker 3>Do you think we have too much inflation.

0:29:11.600 --> 0:29:14.080
<v Speaker 5>Right now or in the future? Yeah?

0:29:14.280 --> 0:29:16.120
<v Speaker 8>Yeah, right now, I think we're still we still have

0:29:16.160 --> 0:29:19.600
<v Speaker 8>that hangover from all the COVID spending going forward. If

0:29:19.600 --> 0:29:23.440
<v Speaker 8>you have there could be an increase in inflation coming

0:29:23.480 --> 0:29:26.880
<v Speaker 8>from the tariffs, right or the threat of tariffs, and

0:29:27.280 --> 0:29:30.160
<v Speaker 8>most of these companies will probably price that through to

0:29:30.200 --> 0:29:31.400
<v Speaker 8>the end consumer.

0:29:31.080 --> 0:29:32.440
<v Speaker 3>Or tax breaks some have said.

0:29:32.720 --> 0:29:35.360
<v Speaker 2>I mean, what's interesting is we had actually a listener,

0:29:35.640 --> 0:29:37.880
<v Speaker 2>a Bloomberg terminal users say, listen, we got to push

0:29:37.880 --> 0:29:40.080
<v Speaker 2>back a little bit on tariffs and the impact on inflation,

0:29:40.600 --> 0:29:44.120
<v Speaker 2>because you know, maybe there have been economists and folks

0:29:44.120 --> 0:29:46.320
<v Speaker 2>on our air that have also said maybe that's not

0:29:46.440 --> 0:29:46.880
<v Speaker 2>the case.

0:29:46.960 --> 0:29:48.600
<v Speaker 3>So we'll have to see on that one.

0:29:48.840 --> 0:29:52.680
<v Speaker 2>But I do think about tax cuts creating more velocity

0:29:52.680 --> 0:29:55.560
<v Speaker 2>in terms of money in the system, that could be Inflationay,

0:29:55.600 --> 0:29:55.880
<v Speaker 2>we just.

0:29:55.800 --> 0:29:56.840
<v Speaker 3>Heard that with our Josh Green.

0:29:56.960 --> 0:30:00.360
<v Speaker 4>What about immigration policy and the labor market something I

0:30:00.360 --> 0:30:05.400
<v Speaker 4>think about a lot. According to the Center for Migration Studies,

0:30:06.440 --> 0:30:10.360
<v Speaker 4>there are about eleven point seven million undocumented.

0:30:09.880 --> 0:30:10.920
<v Speaker 5>People here in the US.

0:30:11.920 --> 0:30:15.040
<v Speaker 4>If they get deported in a very short period of time,

0:30:15.200 --> 0:30:16.640
<v Speaker 4>there are gonna be a lot of people who are

0:30:16.680 --> 0:30:17.680
<v Speaker 4>looking to fill jobs.

0:30:17.720 --> 0:30:17.960
<v Speaker 5>Yeah.

0:30:18.120 --> 0:30:20.640
<v Speaker 4>Yeah, a lot of managers looking to fill for sure.

0:30:20.640 --> 0:30:22.440
<v Speaker 4>I think I'm wondering what that does to the labor market.

0:30:22.480 --> 0:30:24.720
<v Speaker 8>Yeah, I think the labor market is more in balance

0:30:24.840 --> 0:30:26.960
<v Speaker 8>today than it was just a couple of years ago.

0:30:27.080 --> 0:30:30.760
<v Speaker 8>So yeah, the immigration, that's that is a potential risk

0:30:31.000 --> 0:30:35.760
<v Speaker 8>to the inflation environment. But if you're getting that inflation

0:30:35.960 --> 0:30:38.760
<v Speaker 8>because the economy is growing and there's more supply chains

0:30:38.800 --> 0:30:41.440
<v Speaker 8>being built out here in the US. I think that's

0:30:41.480 --> 0:30:43.959
<v Speaker 8>a good thing if you get it in the fundamentals

0:30:44.120 --> 0:30:46.640
<v Speaker 8>of these small cap companies. If you're getting that ten percent,

0:30:46.760 --> 0:30:49.760
<v Speaker 8>fifteen twenty percent earnings growth, and all research shows that

0:30:49.840 --> 0:30:52.440
<v Speaker 8>dollars follows earnings growth, and I think that's going to

0:30:52.440 --> 0:30:53.960
<v Speaker 8>be viewed as a positive thing.

0:30:54.080 --> 0:30:56.160
<v Speaker 2>Although voters have said they don't like inflation, and that

0:30:56.240 --> 0:30:58.080
<v Speaker 2>was a clear mandate. Hey, listen before you go, got

0:30:58.120 --> 0:30:59.760
<v Speaker 2>about a minute left here, Let's talk groups.

0:31:00.680 --> 0:31:03.200
<v Speaker 3>What do you like in this environment? Which you like?

0:31:03.360 --> 0:31:03.560
<v Speaker 2>Yeah?

0:31:03.560 --> 0:31:07.600
<v Speaker 8>I think banks mentioned it's uh, regionals. Yeah, they've had

0:31:07.760 --> 0:31:10.520
<v Speaker 8>they've had a bit of a run since Trump was elected,

0:31:10.560 --> 0:31:12.680
<v Speaker 8>but they're still trading at a discount to where they

0:31:12.680 --> 0:31:14.880
<v Speaker 8>were when Trump was in the office the first time.

0:31:15.280 --> 0:31:18.480
<v Speaker 8>And I think the sentiment is so negative. You have

0:31:18.480 --> 0:31:22.320
<v Speaker 8>commercial real estate fears which are unfounded so far, credit

0:31:22.520 --> 0:31:26.320
<v Speaker 8>cycle unfounded so far. They're kicking off pretty good dividends,

0:31:26.400 --> 0:31:28.960
<v Speaker 8>and they're under owned by most institutional investors. So I

0:31:28.960 --> 0:31:30.760
<v Speaker 8>think there's still room to run in regionals.

0:31:31.520 --> 0:31:33.520
<v Speaker 5>What about when it comes to some of the retailers

0:31:33.520 --> 0:31:34.440
<v Speaker 5>out there. Yeah, I think.

0:31:34.560 --> 0:31:36.400
<v Speaker 3>Okay, so that's the reporting this week.

0:31:36.480 --> 0:31:39.080
<v Speaker 8>Yeah, yeah, you know, if you look at the consumer,

0:31:39.120 --> 0:31:41.200
<v Speaker 8>I think we like to say it's trifurcated right that

0:31:41.280 --> 0:31:44.000
<v Speaker 8>the high end consumer is still doing really well. Low

0:31:44.040 --> 0:31:46.680
<v Speaker 8>in consumer if you look at the dollar stores, pretty tough.

0:31:47.000 --> 0:31:49.680
<v Speaker 8>But we believe that there's some areas that are bouncing

0:31:49.720 --> 0:31:51.360
<v Speaker 8>off of the bottom. So if you look at boats,

0:31:51.440 --> 0:31:54.160
<v Speaker 8>boats have fallen off a cliff. They're down fifty percent.

0:31:55.120 --> 0:31:57.400
<v Speaker 8>But we think there's a bottoming and we think we're

0:31:57.400 --> 0:32:00.440
<v Speaker 8>going to see improving numbers going forward. So it's all

0:32:00.440 --> 0:32:03.680
<v Speaker 8>about that acceleration. So we're getting that off of the bottom. Boats,

0:32:03.960 --> 0:32:07.360
<v Speaker 8>r v's potentially housing, We'll have to see what happens

0:32:07.400 --> 0:32:09.800
<v Speaker 8>with housing. That would be a good catalyst for small

0:32:09.800 --> 0:32:10.680
<v Speaker 8>caps very quickly.

0:32:10.800 --> 0:32:13.840
<v Speaker 2>Energy you like it. If there's more drilling, there's more pumping,

0:32:13.840 --> 0:32:15.240
<v Speaker 2>more supply. Won't that be hurt?

0:32:15.320 --> 0:32:15.520
<v Speaker 5>Yeah?

0:32:15.680 --> 0:32:16.960
<v Speaker 3>Does that hurt the group just quickly?

0:32:17.040 --> 0:32:19.560
<v Speaker 8>No, it's and it goes back to that really to GDP,

0:32:19.680 --> 0:32:22.400
<v Speaker 8>if you have an acceleration in demand, it should offset that.

0:32:22.480 --> 0:32:28.600
<v Speaker 8>The other biggest Yeah, yeah, well, I think the biggest

0:32:28.600 --> 0:32:30.760
<v Speaker 8>thing that we look at is the quality levels at

0:32:30.800 --> 0:32:33.320
<v Speaker 8>these E n p's and the small cap side, they're

0:32:33.480 --> 0:32:36.080
<v Speaker 8>they're much more better run than they were five or

0:32:36.080 --> 0:32:36.640
<v Speaker 8>ten years ago.

0:32:36.760 --> 0:32:39.680
<v Speaker 3>Micro good stuff come back soon. This is this is

0:32:39.720 --> 0:32:44.280
<v Speaker 3>Bloomberg Business Week, mark.

0:32:46.000 --> 0:32:46.640
<v Speaker 5>A journal.

0:32:47.720 --> 0:32:48.720
<v Speaker 2>Now about you let me drive?

0:32:49.240 --> 0:32:53.320
<v Speaker 1>No, no, honey, please, I'll.

0:32:55.520 --> 0:33:00.400
<v Speaker 2>I want to drive. It's a good question time.

0:33:03.200 --> 0:33:07.840
<v Speaker 1>This is the drive to the globe communing well, lad

0:33:08.400 --> 0:33:09.600
<v Speaker 1>on Bloomberg Radio.

0:33:11.480 --> 0:33:13.960
<v Speaker 2>All right, TikTok, everybody, Just about eighteen minutes left in

0:33:14.000 --> 0:33:17.440
<v Speaker 2>today's trading session here on this Monday, we've got like

0:33:17.520 --> 0:33:19.160
<v Speaker 2>games as you just heard from Charlie and the S

0:33:19.200 --> 0:33:22.160
<v Speaker 2>and P five hundred outperformance in the Nasdaq one hundred

0:33:22.680 --> 0:33:24.440
<v Speaker 2>up about one hundred and forty five points, good for

0:33:24.520 --> 0:33:25.120
<v Speaker 2>gain of seven.

0:33:25.040 --> 0:33:27.920
<v Speaker 3>Tens a percent. Wasn't so great for stocks last week.

0:33:28.000 --> 0:33:30.120
<v Speaker 2>But again, earnings are going to be front and center

0:33:30.160 --> 0:33:31.760
<v Speaker 2>with Nvidian, a few others reporting us.

0:33:31.840 --> 0:33:33.880
<v Speaker 4>Yeah, we're gonna hear from the retailers, many of the retailers,

0:33:33.920 --> 0:33:36.080
<v Speaker 4>so we've got a good read on the consumer. Let's

0:33:36.080 --> 0:33:37.760
<v Speaker 4>see what Jeff McLain has to say about this. He's

0:33:37.800 --> 0:33:40.440
<v Speaker 4>a ceover at Solidarity Wealth. It's a wealth management firm

0:33:40.480 --> 0:33:42.840
<v Speaker 4>based in Utah. They've got about six hundred million dollars

0:33:42.920 --> 0:33:45.440
<v Speaker 4>in assets under management. Jeff joined us here in the

0:33:45.440 --> 0:33:49.480
<v Speaker 4>Bloomberg Interactive Brokers studio. I'm wondering what's top of mind

0:33:49.520 --> 0:33:51.520
<v Speaker 4>for your clients right now when you're out there talking

0:33:51.600 --> 0:33:51.920
<v Speaker 4>to them.

0:33:52.320 --> 0:33:54.600
<v Speaker 5>What are they asking you? What do they want to know?

0:33:55.080 --> 0:33:57.320
<v Speaker 9>Yeah, I think a lot of it is election related.

0:33:57.560 --> 0:33:59.520
<v Speaker 9>I mean, what does the next four years look like

0:34:00.080 --> 0:34:03.320
<v Speaker 9>in the excitement or nervousness depending on the political backgrounds

0:34:03.520 --> 0:34:06.320
<v Speaker 9>of where they're looking at the markets From our perspective,

0:34:06.600 --> 0:34:08.440
<v Speaker 9>I mean, I think in either case, you were going

0:34:08.520 --> 0:34:11.880
<v Speaker 9>to have some consistency of the current administration continuing on

0:34:12.160 --> 0:34:14.480
<v Speaker 9>or Trump. We've we've kind of seen the show before.

0:34:15.000 --> 0:34:17.120
<v Speaker 9>It'll be different people involved, but we kind of know

0:34:17.200 --> 0:34:18.920
<v Speaker 9>what's coming, and you're seeing that a little bit in

0:34:19.000 --> 0:34:22.600
<v Speaker 9>the market of a bit of steadiness associated with it.

0:34:22.920 --> 0:34:25.600
<v Speaker 9>You're essentially going to have divided government with the house

0:34:25.719 --> 0:34:29.800
<v Speaker 9>being so tight, it'll be incredibly tight if anything in

0:34:29.880 --> 0:34:32.520
<v Speaker 9>the house. You think so, Yeah, I think as you

0:34:32.719 --> 0:34:34.680
<v Speaker 9>talk about the people he's named, they're going to have

0:34:34.719 --> 0:34:36.560
<v Speaker 9>to give up their spots in the house.

0:34:36.719 --> 0:34:37.480
<v Speaker 5>You have a few lives.

0:34:37.640 --> 0:34:39.879
<v Speaker 2>I wonder if there's somebody with a whiteboard said hey, wait,

0:34:41.480 --> 0:34:42.720
<v Speaker 2>his name is Speaker Johnson.

0:34:42.920 --> 0:34:45.520
<v Speaker 9>Yeah, and I don't think they're being that strategic and

0:34:45.640 --> 0:34:48.920
<v Speaker 9>so divided government's good for the markets, right, nothing's crazy

0:34:48.960 --> 0:34:49.479
<v Speaker 9>going to happen.

0:34:50.760 --> 0:34:52.600
<v Speaker 4>I would think they are being strategic because they want to,

0:34:52.680 --> 0:34:55.200
<v Speaker 4>you know, and that's stuff done. Jusie Wilds, the incoming

0:34:55.280 --> 0:34:57.279
<v Speaker 4>chief of Staff, made the point at a fundraiser last

0:34:57.360 --> 0:34:59.880
<v Speaker 4>week in Las Vegas that was basically like this, according

0:34:59.880 --> 0:35:02.920
<v Speaker 4>to New York Times, that hey, we got two years

0:35:03.520 --> 0:35:06.840
<v Speaker 4>to get everything done because the history, you know, books

0:35:06.880 --> 0:35:09.399
<v Speaker 4>show that if you have a trifecta in government, it's

0:35:09.640 --> 0:35:10.120
<v Speaker 4>not forever.

0:35:10.600 --> 0:35:12.600
<v Speaker 9>Yeah, that's true. But at the end of the day,

0:35:12.800 --> 0:35:14.759
<v Speaker 9>special elections that are going to have to come up

0:35:14.760 --> 0:35:19.120
<v Speaker 9>to replace those seats. Republicans do terrible in special elections historically,

0:35:19.760 --> 0:35:21.480
<v Speaker 9>and so I think at the end of the day

0:35:21.520 --> 0:35:24.279
<v Speaker 9>the House will be divided, which again I think is good.

0:35:24.520 --> 0:35:28.040
<v Speaker 9>Nothing crazy can happen if you start with a proposition

0:35:28.200 --> 0:35:31.279
<v Speaker 9>like I do, that most government officials are not great

0:35:31.320 --> 0:35:33.920
<v Speaker 9>people and they're going to trade in their own self interest.

0:35:34.440 --> 0:35:35.239
<v Speaker 9>Divide is great.

0:35:35.320 --> 0:35:40.000
<v Speaker 5>They can't do anything. There's a lot of places I

0:35:40.040 --> 0:35:41.400
<v Speaker 5>could go with that, because.

0:35:41.280 --> 0:35:43.600
<v Speaker 4>Where do you want to go, well, is that a

0:35:43.680 --> 0:35:46.400
<v Speaker 4>concern to you in terms of the way that the

0:35:46.480 --> 0:35:48.840
<v Speaker 4>government has been run in the way that the government

0:35:49.840 --> 0:35:52.279
<v Speaker 4>potentially will be run in the new administration. There are

0:35:52.280 --> 0:35:54.680
<v Speaker 4>a lot of folks very close to the president who

0:35:54.760 --> 0:35:56.279
<v Speaker 4>have a lot of money.

0:35:56.800 --> 0:35:59.400
<v Speaker 9>Yeah, and I would say that's always true, right, Whenever

0:35:59.440 --> 0:36:02.080
<v Speaker 9>there's power, money is attracted to it, and so that's

0:36:02.120 --> 0:36:03.960
<v Speaker 9>always been the case. I think long term is that

0:36:04.040 --> 0:36:04.440
<v Speaker 9>a problem?

0:36:04.600 --> 0:36:04.759
<v Speaker 1>Yeah?

0:36:04.840 --> 0:36:07.800
<v Speaker 9>Short term, no, I don't see any issues there. I

0:36:07.920 --> 0:36:09.600
<v Speaker 9>do think some of the changes they're going to make

0:36:09.920 --> 0:36:14.440
<v Speaker 9>do help certain sectors over others. Right. RFK Junior Pharma

0:36:14.560 --> 0:36:18.759
<v Speaker 9>has obviously traded down since that name was nominated to

0:36:18.840 --> 0:36:19.320
<v Speaker 9>the position.

0:36:19.880 --> 0:36:22.160
<v Speaker 5>That's probably justified. We'll see if he gets confirmed.

0:36:22.239 --> 0:36:23.200
<v Speaker 9>Yeah, that's a big if.

0:36:23.600 --> 0:36:27.279
<v Speaker 2>All right, So the week after the election, I'm going

0:36:27.360 --> 0:36:29.120
<v Speaker 2>back to not last week. Last week's stocks were down

0:36:29.120 --> 0:36:30.440
<v Speaker 2>about two percent. If I'm looking at the S and

0:36:30.480 --> 0:36:32.000
<v Speaker 2>P five found to the prior week, they're up about

0:36:32.000 --> 0:36:33.960
<v Speaker 2>four point seven percent. So we've seen a little bit

0:36:33.960 --> 0:36:36.080
<v Speaker 2>of a correct but not all the way back. I mean,

0:36:36.200 --> 0:36:39.239
<v Speaker 2>are what we're seeing right now is all right, some enthusiasm,

0:36:39.280 --> 0:36:42.120
<v Speaker 2>but we don't really know what policies are ultimately going

0:36:42.160 --> 0:36:45.160
<v Speaker 2>to be put into effect. So hold on, everybody, kind

0:36:45.200 --> 0:36:47.480
<v Speaker 2>of slow your role and let's see. Yeah, it's a

0:36:47.520 --> 0:36:49.080
<v Speaker 2>long h Is there anything that you feel like you

0:36:49.160 --> 0:36:51.279
<v Speaker 2>can bank on right now in terms of a Trump

0:36:51.320 --> 0:36:53.600
<v Speaker 2>administration what it means for playing the equity term?

0:36:53.680 --> 0:36:56.239
<v Speaker 9>Yeah, from a long term perspective, all that right now

0:36:56.360 --> 0:36:59.480
<v Speaker 9>is noise. From a short term trading perspective, volatility is

0:36:59.520 --> 0:37:02.239
<v Speaker 9>going to continue spike with every new announcement, depending on

0:37:02.320 --> 0:37:05.320
<v Speaker 9>because he's not going to nominate an you know, steady,

0:37:05.920 --> 0:37:07.880
<v Speaker 9>keep it as it is type person. He's just not

0:37:08.320 --> 0:37:11.200
<v Speaker 9>And so every new announcement's going to drive volatility and.

0:37:11.200 --> 0:37:13.080
<v Speaker 3>A specifically it kind of did in the first term.

0:37:13.360 --> 0:37:14.319
<v Speaker 5>Yeah, and it did, but.

0:37:14.360 --> 0:37:16.440
<v Speaker 9>You're going to see that with the Treasury whoever he

0:37:16.560 --> 0:37:19.320
<v Speaker 9>names in the cat fighting that's involved right now, whoever

0:37:19.400 --> 0:37:21.360
<v Speaker 9>he names, you're going to see some trades based on

0:37:21.480 --> 0:37:24.239
<v Speaker 9>whoever that is, depending on if it's someone from a

0:37:24.280 --> 0:37:28.880
<v Speaker 9>traditional finance background or is it someone outside right an

0:37:29.040 --> 0:37:31.160
<v Speaker 9>unknown to the financial world.

0:37:31.400 --> 0:37:34.160
<v Speaker 2>I got to say these conversations. I like macro, but

0:37:34.280 --> 0:37:37.080
<v Speaker 2>it's like, okay, so what do we do? Yeah, because

0:37:37.080 --> 0:37:39.279
<v Speaker 2>if you've got a portfolio you're thinking about it. I

0:37:39.320 --> 0:37:40.480
<v Speaker 2>think about investments.

0:37:40.520 --> 0:37:41.440
<v Speaker 3>I'm like, what do I do do?

0:37:41.560 --> 0:37:43.520
<v Speaker 2>I like, you know, things have had a nice little

0:37:43.560 --> 0:37:45.279
<v Speaker 2>run this year, but is it going to get a

0:37:45.280 --> 0:37:46.319
<v Speaker 2>little sketchy next year?

0:37:46.400 --> 0:37:49.960
<v Speaker 3>We just don't know. So what do you say? You are,

0:37:50.480 --> 0:37:53.680
<v Speaker 3>you know, responsible for managing the wealth of your clients.

0:37:54.120 --> 0:37:54.920
<v Speaker 3>What do you do right now?

0:37:55.000 --> 0:37:59.320
<v Speaker 2>Have you made any changes to portfolios since the election outcome?

0:37:59.520 --> 0:37:59.680
<v Speaker 1>Yes?

0:38:00.320 --> 0:38:00.440
<v Speaker 9>Yes?

0:38:00.520 --> 0:38:01.520
<v Speaker 3>What have what have you done?

0:38:01.520 --> 0:38:03.640
<v Speaker 9>And so you know, I think part of that is

0:38:03.640 --> 0:38:07.000
<v Speaker 9>trimming allocations in certain segments and areas that aren't going

0:38:07.080 --> 0:38:11.120
<v Speaker 9>to do well. So, generally speaking, defense could be a problem. If,

0:38:11.200 --> 0:38:13.920
<v Speaker 9>for example, you own Lockheed Martin, right, they are going

0:38:14.000 --> 0:38:17.240
<v Speaker 9>to be a target of what the VEC and Elon

0:38:17.360 --> 0:38:20.200
<v Speaker 9>Musk are doing. They're no bid contracts, probably not going

0:38:20.280 --> 0:38:22.520
<v Speaker 9>to be looking good here in the next couple months.

0:38:22.920 --> 0:38:27.000
<v Speaker 9>If Elon Musk and his team are successful. Another group

0:38:27.040 --> 0:38:27.440
<v Speaker 9>that could be.

0:38:27.600 --> 0:38:30.840
<v Speaker 2>Until senators and members of Congress and House reps saying.

0:38:31.080 --> 0:38:33.759
<v Speaker 5>By the way, our constituents are pretty upset about this.

0:38:33.960 --> 0:38:36.839
<v Speaker 9>Yeah, yeah, there is part of that. But remember, from

0:38:36.840 --> 0:38:41.200
<v Speaker 9>an administrative law perspective, presidencies have enormous power to do

0:38:41.360 --> 0:38:44.640
<v Speaker 9>things independent of Congress. And both administrations, and so they

0:38:44.680 --> 0:38:49.000
<v Speaker 9>can drive significant change just changing the no bid contract

0:38:49.080 --> 0:38:53.600
<v Speaker 9>thing alone to ban any no bid contract. That's a problem.

0:38:53.640 --> 0:38:55.040
<v Speaker 3>What does that mean? So nobody can bid?

0:38:55.239 --> 0:38:55.359
<v Speaker 5>Right?

0:38:55.480 --> 0:38:58.200
<v Speaker 9>So they directed directly to Lockheed Martin. If you win

0:38:58.280 --> 0:39:01.759
<v Speaker 9>this contract and it's not an open process for that

0:39:02.120 --> 0:39:04.600
<v Speaker 9>government contract, which are billions and billions.

0:39:04.320 --> 0:39:06.520
<v Speaker 3>Of dollars, you've seen opposite of what it's You've.

0:39:06.440 --> 0:39:09.279
<v Speaker 9>Seen Elon Musk fight this from his side of saying, hey,

0:39:09.320 --> 0:39:11.520
<v Speaker 9>we can do these things. We're doing the way cheaper

0:39:11.560 --> 0:39:14.160
<v Speaker 9>than NASA and all these other things. But yet NASA

0:39:14.239 --> 0:39:17.640
<v Speaker 9>is getting these or Boeing is getting these gigantic contracts

0:39:17.680 --> 0:39:18.520
<v Speaker 9>and are not performing.

0:39:18.880 --> 0:39:20.480
<v Speaker 3>So tripping defense, what else have you been doing for

0:39:20.520 --> 0:39:20.920
<v Speaker 3>your clients?

0:39:21.880 --> 0:39:26.040
<v Speaker 9>I think Boeing's and although I agree with their CEO change,

0:39:26.080 --> 0:39:28.480
<v Speaker 9>I think that's a good move. I think long term

0:39:28.600 --> 0:39:31.440
<v Speaker 9>Boeing could be good. From a short term perspective, Boeing's

0:39:31.480 --> 0:39:34.960
<v Speaker 9>problematic for a variety of reasons. That has been and

0:39:35.040 --> 0:39:37.319
<v Speaker 9>I would argue it's going to continue to be problematic

0:39:37.680 --> 0:39:39.960
<v Speaker 9>from a go forward. I think there's also some trading

0:39:40.480 --> 0:39:43.880
<v Speaker 9>opportunities and what I would call the anti ESG trade,

0:39:44.320 --> 0:39:46.880
<v Speaker 9>Those kind of industries that aren't favored in the EESG

0:39:47.280 --> 0:39:50.040
<v Speaker 9>where that's at times defense like pell and Teer, which

0:39:50.040 --> 0:39:54.200
<v Speaker 9>will probably be a winner from this administration. Oil and gas,

0:39:54.600 --> 0:39:57.520
<v Speaker 9>although not broadly like your Exon or Chevron, But think

0:39:57.600 --> 0:40:01.160
<v Speaker 9>of the pipeline type of producer and those actually pulling

0:40:01.239 --> 0:40:02.400
<v Speaker 9>the minerals out of the ground.

0:40:02.600 --> 0:40:04.640
<v Speaker 5>Even if we see a decline in demand.

0:40:04.719 --> 0:40:06.440
<v Speaker 9>Or yeah, I think from a long term they have

0:40:06.560 --> 0:40:10.000
<v Speaker 9>some great opportunities because you're more likely to find value

0:40:10.080 --> 0:40:13.480
<v Speaker 9>there because the huge part of return is what you're

0:40:13.560 --> 0:40:17.520
<v Speaker 9>buying it for. Because of the disfavored nature of those industries,

0:40:17.600 --> 0:40:20.600
<v Speaker 9>you can get better valuations than the broader market, and

0:40:20.760 --> 0:40:23.040
<v Speaker 9>so over time that's going to play out. Even if

0:40:23.480 --> 0:40:25.640
<v Speaker 9>some people want to hold their nose at it, we

0:40:25.840 --> 0:40:29.560
<v Speaker 9>still need oil, it funds just about everything in our society.

0:40:29.640 --> 0:40:32.319
<v Speaker 2>You're the second person today that is looking at small caps.

0:40:32.360 --> 0:40:35.040
<v Speaker 2>Forgive me only about twenty five seconds. You like small caps,

0:40:35.120 --> 0:40:36.960
<v Speaker 2>put money there, or you are putting money there.

0:40:37.360 --> 0:40:39.680
<v Speaker 9>We are, and I like it from a go forward perspective.

0:40:39.760 --> 0:40:41.839
<v Speaker 9>You have to be careful, right, not all small caps

0:40:41.840 --> 0:40:44.480
<v Speaker 9>are created equal, but yeah, small caps can be an

0:40:44.520 --> 0:40:49.120
<v Speaker 9>incredible opportunity right now based on valuation simply compared to

0:40:49.200 --> 0:40:49.720
<v Speaker 9>large caps.

0:40:50.320 --> 0:40:51.640
<v Speaker 3>All right, we gotta leave it there. Of course we

0:40:51.719 --> 0:40:54.360
<v Speaker 3>had more time. Good stuff, come back. Thank you really appreciate.

0:40:54.440 --> 0:40:57.239
<v Speaker 2>Jeff McLain's chief executive officer at Solidary Wealth.

0:40:57.280 --> 0:40:58.760
<v Speaker 3>As we said, they're based in Utah.

0:40:59.480 --> 0:41:03.000
<v Speaker 9>Yes, right now, all right, ski season is here, come

0:41:03.040 --> 0:41:03.960
<v Speaker 9>to Utah, skier.

0:41:04.400 --> 0:41:05.399
<v Speaker 3>Have you ever ski in Utah?

0:41:05.520 --> 0:41:07.600
<v Speaker 5>Of course, of course he has a crazy flight.

0:41:09.440 --> 0:41:14.040
<v Speaker 1>This is the Bloomberg Business Week podcast, available on Apple, Spotify,

0:41:14.200 --> 0:41:17.920
<v Speaker 1>and anywhere else you get your podcasts. Listen live weekday

0:41:17.920 --> 0:41:21.399
<v Speaker 1>afternoons from two to five pm Eastern on Bloomberg dot Com,

0:41:21.600 --> 0:41:24.879
<v Speaker 1>the iHeartRadio app, tune In, and the Bloomberg Business App.

0:41:24.960 --> 0:41:27.880
<v Speaker 1>You can also watch us live every weekday on YouTube

0:41:28.160 --> 0:41:30.120
<v Speaker 1>and always on the Bloomberg terminal