Speaker 1: Welcome to Bloomberg Opinion. I'm only this week. The main
Speaker 1: thing Republicans I hope take away from this is that
Speaker 1: opposing democracy is dangerous. Running on a platform without having
Speaker 1: any policies to address the problems that they point out
Speaker 1: is not necessarily a plus with voters, and having a
Speaker 1: bunch of flakes and otherwise unqualified candidates can be harmful.
Speaker 1: Jonathan Bernstein there on the November surprise. It was surprises
Speaker 1: all around this week, though not just at the ballot box,
Speaker 1: but also from inflation data on the markets. Let's get
Speaker 1: straight to all of that with Jonathan Livin. So, Jonathan
Speaker 1: albanign was this week's CPI print that clearly looked pretty good,
Speaker 1: and obviously the market has been looking for some good news.
Speaker 1: We've been plagued by bad reports that were worse than
Speaker 1: expected all year long pretty much. However, I have to
Speaker 1: say that a lot of what happened in this report
Speaker 1: was explainable by a methodological quirk and be the stuff
Speaker 1: from used car prices that many of us have been expecting.
Speaker 1: I'm not sure that it dramatically changes the underlying signal
Speaker 1: for the Federal Reserve. Exactly is the market overreacting. I mean,
Speaker 1: it's one thing for equities, but you're not saying bonds
Speaker 1: react to quite the same extent. Yeah, I think that's
Speaker 1: certainly possible. I mean, one place to look for the
Speaker 1: underlying signal is what's going on in core services after
Speaker 1: a shelter and after medical care services. I'll tell you
Speaker 1: a bit about the quirk that's going on in this
Speaker 1: month's data. Effectively, health insurance is measured in a very
Speaker 1: idiosyncratic manner in the Consumer Price Index. The Bureau of
Speaker 1: Labor Statistics essentially back this out from health insurers retained earnings,
Speaker 1: and basically you get a new data dump every twelve months,
Speaker 1: and the Bureau of Labor Statistics ends up extrapolating that
Speaker 1: over the coming twelve months. And for reasons that are
Speaker 1: very sort of technical and idiosyncratic and really have everything
Speaker 1: to do with the strange pandemic economy and very little
Speaker 1: to do with underlying inflation, health insurance inflation went from
Speaker 1: being an insane pressure point on the index to a
Speaker 1: major drag on the index. So what I like to
Speaker 1: do is I strip out some of these idiosyncratic elements. Right,
Speaker 1: So if you just look at core services X shelter,
Speaker 1: which is another weird element in the index, and x
Speaker 1: medical care services, So stripping out that health insurance effect,
Speaker 1: you're still looking at something like a zero point five
Speaker 1: move on the month, which hints at underlying inflation of
Speaker 1: somewhere around six six and a half percent. It's a
Speaker 1: little better, I guess, but we're obviously not out of
Speaker 1: the woods, and the market has started to deprice it
Speaker 1: in a fifty basis point move and then really nothing
Speaker 1: until next March. It seems a bit too optimistic. But
Speaker 1: is the market always right? Yeah? I mean, I think
Speaker 1: what we're really looking at here is a increasing optimism
Speaker 1: that they will down shift to fifty, which is not
Speaker 1: at all surprising. There have been plenty of FED speakers
Speaker 1: who have been hinting that this is coming. No matter what, right,
Speaker 1: the firmware reserve really doesn't want to reach its destination
Speaker 1: point going a hundred miles an hour. It wants to
Speaker 1: be able to look around as it arrives at its
Speaker 1: ultimate destination see if the incoming data confirms that it's
Speaker 1: reaching an appropriate policies stands and be able to adjust accordingly.
Speaker 1: I don't think that that changes that much in terms
Speaker 1: of the ultimate destination and how long the FED probably
Speaker 1: wants to stay there. So if you look at FED
Speaker 1: funds futures, what they're basically telling us, again not insane,
Speaker 1: is that maybe that destination is about twenty five basis
Speaker 1: points lower than we had previously been expecting. Now, what's weird, however,
Speaker 1: as you're alluding to, is you have stocks. You have
Speaker 1: the nasdak in the biggest jump since April on that,
Speaker 1: you know, I think some equity market optimism makes sense,
Speaker 1: but you would envision from a fundamental standpoint, maybe I
Speaker 1: move about half as big as the one that you're
Speaker 1: actually seeing out there. Well, obviously, the other thing this
Speaker 1: week was the mid terms, and while we will have
Speaker 1: divided government, most likely it's kind of a strangely divided
Speaker 1: government at this point. What's more likely stimulus politics or
Speaker 1: inflation slash debt politics. I think what's most likely is
Speaker 1: grid luck and not much gets done. So if you're
Speaker 1: a bit of a politics cynic, maybe you actually see
Speaker 1: that as a good thing. The biggest risk going into
Speaker 1: all of this, I think was arguably that an emboldened
Speaker 1: Republican party might push for some debt ceiling antics and
Speaker 1: we could have some sort of reprise of the volatility
Speaker 1: that we saw in two thousand eleven, where Republicans used
Speaker 1: the debt ceiling as a threat to extract something that
Speaker 1: they want. Of course, in two thousand eleven, an end
Speaker 1: result of all that was the United States ended up
Speaker 1: getting downgraded by Standard and Poors. I don't think that
Speaker 1: that kind of all atility was something that the market
Speaker 1: necessarily needed given all of the headwinds here. So if
Speaker 1: you believe at the margin that maybe the lack of
Speaker 1: a red wave leads to a less emboldened Republican party
Speaker 1: and a lesser likelihood of something like that happened, maybe
Speaker 1: at the margins you could even read this as slightly
Speaker 1: positive and we'll see if that gets done before the
Speaker 1: end of the year. It has been the worst year
Speaker 1: in at least fifty years for the bond market. Do
Speaker 1: you imagine that that statistical improved by the end of
Speaker 1: the year? I intenser around now, aunt it's reasonable to think. So.
Speaker 1: I think a good question is hand bonds actually rally
Speaker 1: from here. It really seems to me that, you know,
Speaker 1: if you believe the feds rhetoric, which I do, that
Speaker 1: they have the short end pinned here. The belly of
Speaker 1: the curve, the ten year tends to be a place
Speaker 1: where traders will express a view of raith coming down. Eventually,
Speaker 1: the ten year part of the curve can definitely rally
Speaker 1: even as the short end stays put. However, you know
Speaker 1: what's interesting is that we know that the FED wants
Speaker 1: to see tighter financial conditions. Chair Jerome Peal mentioned at
Speaker 1: his last press conference last week that he's not just
Speaker 1: paying attention to the short end. He wants to see
Speaker 1: meaningfully positive real rates all throughout the curve. So a
Speaker 1: question that I have is, should that ten year segment
Speaker 1: of the yield curve start to rally in any meaningful way,
Speaker 1: would you then see FED speakers again ratchet up the
Speaker 1: hawkish rhetoric or could we even face the specter of
Speaker 1: the FED selling treasuries from its portfolio just to make
Speaker 1: sure that the curve looks away the FED wants it
Speaker 1: to look Bloomberg Opinions Jonathan live In more next on
Speaker 1: Bloomberg Opinion. I'm Vonnie Quinn. I have to say, Jonathan,
Speaker 1: you call this in a lot of senses when it
Speaker 1: comes to the issues that voters are voting on, for example,
Speaker 1: and you know you said that it's not just I'm done,
Speaker 1: And the only other person I've heard say that is
Speaker 1: Michael Moore recently. Well I'm not all right, So Jonathan,
Speaker 1: we're talking Wednesday afternoon. Nevada and Arizona have yet to
Speaker 1: be called, and it's all but certain that Georgia has
Speaker 1: headed for a special election December six. However, we do
Speaker 1: know a lot, an awful lot about US democracy right now.
Speaker 1: Is it in less trouble than we thought? Yeah? I
Speaker 1: think so, with huge numbers of caveats about that. We're
Speaker 1: not out of the woods, and the threats still real
Speaker 1: and things could change rapidly. But there were a number
Speaker 1: of positive signs after a very bad start that the primaries.
Speaker 1: We had some candidates refusing to concede during their Republican primaries.
Speaker 1: We had efforts to harass election workers all summer in fall.
Speaker 1: We had in the early voting in Arizona a couple
Speaker 1: of these clowns show up in military gear observing drop
Speaker 1: boxes and intimidating voters. But then as elections they came,
Speaker 1: that sort of dropped off and we didn't get stories,
Speaker 1: at least not significantly organized efforts at at voter intimidation
Speaker 1: which was a real fear. We didn't so far as
Speaker 1: we're speaking. This could change any minute. But Republicans who
Speaker 1: have lost have conceded properly, normally, and while there are
Speaker 1: some crazy conspiracies that are circulating, they have not migrated.
Speaker 1: They have not made the important step of migrating into
Speaker 1: the mouths of politicians and for the most part, too
Speaker 1: high profile Republican align media. So the concessions are interesting.
Speaker 1: As you say, it's sort of back to business as normal,
Speaker 1: the old politics that we knew and loved. Did something
Speaker 1: change within the Republican Party. Did these people get the
Speaker 1: message from leadership that they were to do this? I
Speaker 1: have not seen any reporting on this. Threats to democracy
Speaker 1: didn't start with Donald Trump. They have deep routes in
Speaker 1: the party going back quite some time and having gotten worse.
Speaker 1: And that's one of the reasons we got Trump. But
Speaker 1: Trump himself as an outlier. Trump himself feels completely apparently,
Speaker 1: or at least he does it completely willing to claim
Speaker 1: fraud no matter what. He doesn't need some sort of pretext.
Speaker 1: He proclaimed fraud in every election he was on the ballot.
Speaker 1: Before the election happened, he proclaimed that he was ripped
Speaker 1: off by fraud. After winning the presidency, the one time
Speaker 1: you would think that candidate would want to increase respect
Speaker 1: for elections and confidence in elections, he still said there
Speaker 1: was sons of fraud that he had no evidence for.
Speaker 1: And I think that it turns out that when the
Speaker 1: leader of their party is saying it very loudly, a
Speaker 1: lot of Republicans go along, either because they think the
Speaker 1: incentives are there, that they're better off agreeing with the
Speaker 1: leader of their party, or possibly just because they actually
Speaker 1: believe it. I think a lot of rank and file
Speaker 1: voters and some of the candidates come out of the
Speaker 1: rank and file voter group. You know, they hear a
Speaker 1: Republican president say something, they say here, well, he may
Speaker 1: be exaggerating, but there's got to be something to it,
Speaker 1: or else he wouldn't say it. It turns out Donald
Speaker 1: Trump is willing to say a lot of things just
Speaker 1: because he said them, and that is unusual, obviously very dangerous.
Speaker 1: So that I think helped. I think we got a
Speaker 1: little lucky so far, at least that most of the
Speaker 1: losers lost by a substantial amount. Again, if that was
Speaker 1: trumpet wouldn't stop them from claiming fraud. But you know,
Speaker 1: normal people if they lose an election by eight, ten,
Speaker 1: fifteen percentage points, they see what's going on, I mean lucky.
Speaker 1: But also more people registered and so on. And it
Speaker 1: was a different election, in fact, a very very different election,
Speaker 1: one of the kind. Speaking of Trump, dr ols did terribly.
Speaker 1: It took more money than expected to win. In Ohio,
Speaker 1: governors that had not had Trump's backing, like Camp and
Speaker 1: the Wine, they won fine without Trump. Carry Lake is
Speaker 1: in trouble in Arizona in the governor's race. What position
Speaker 1: does this all leave Trump in? You know, it's very
Speaker 1: hard to tell, because there have been other moments where
Speaker 1: it was clear that Trump was a drag on the
Speaker 1: party and that his judgment is terrible. You know, he
Speaker 1: endorsed these candidates who were terrible candidates, and he's not
Speaker 1: good at this kind of stuff. Now it doesn't bother him.
Speaker 1: Apparently he was today blaming his wife for his endorsement
Speaker 1: of doctor Oz. You know, Donald Trump is, of course,
Speaker 1: the only president we've ever had who repeatedly criticized extreme
Speaker 1: criticisms of his own cabinet nominees. People he put in
Speaker 1: his own cabinet turned out to be horrible, horrible people
Speaker 1: and he never took any responsibility for that. So we've
Speaker 1: had these points before, and Republican politicians and other party
Speaker 1: actors and the Republican aligned media have not made the
Speaker 1: decision to cut him off. And perhaps because they really
Speaker 1: don't believe that he's arming them, or perhaps because of
Speaker 1: other reasons. I think the Republican aligned media has ratings incentives.
Speaker 1: He sells a lot of books, he sells a lot
Speaker 1: of ads, and increases ratings. So there's that. And I
Speaker 1: think a lot of candidates are just afraid that he
Speaker 1: will go after them, even though the evidence isn't really
Speaker 1: there that he's that much of a threat. But politicians
Speaker 1: tend to be paranoid about that sort of thing. We'll
Speaker 1: come back to Trump in a moment. But what kind
Speaker 1: of lessons should Republicans learn from this election, given that
Speaker 1: they really didn't do as well as expected, particularly in
Speaker 1: places like in the Midwest, and it may mean that
Speaker 1: a sweep in is off the table, for example, mail
Speaker 1: in voting, should they embrace it? I do think that Republicans,
Speaker 1: by demonizing mail and voting, are making it more difficult
Speaker 1: for their own voters. I don't know that there have
Speaker 1: been any careful studies that actually show that it makes
Speaker 1: a difference. So that's something I know. I don't think
Speaker 1: this tells us anything about two years is a huge
Speaker 1: long time, and there's basically no correlation between what happens
Speaker 1: in mid terms and what happens in the next presidential election.
Speaker 1: But I think the main thing Republicans I hope take
Speaker 1: away from this is that opposing democracy is dangerous, that
Speaker 1: running on a platform without having any policies to address
Speaker 1: the problems that they point out is not necessarily a
Speaker 1: plus with voters, and that having a bunch of flakes
Speaker 1: and otherwise, you know, unqualified candidates can be harmful. Whether
Speaker 1: that's the lesson they empirically should take from what happened,
Speaker 1: I don't know. It takes a long time to study
Speaker 1: exactly why elections came out as they did, and even
Speaker 1: if we had all the votes counted, you still have
Speaker 1: to do a lot of work to actually find the
Speaker 1: cause of relationships. But what parties take away from things
Speaker 1: has very little to do sometimes with reality, and more
Speaker 1: to do with internal interests within the party, internal factions
Speaker 1: within the party, and how they fight to have their
Speaker 1: interpretations of what happened become the leading explanations. So, for example,
Speaker 1: we've already seen anti abortion Republicans organized groups of anti
Speaker 1: abortion Republicans say that the reason that Republicans lost is
Speaker 1: because they did from the issue of abortion. Now I
Speaker 1: don't think that's true. Um yeah, I think in fact,
Speaker 1: abortion cost them badly and the candidates shied away from
Speaker 1: it because they knew that it was costing them. But
Speaker 1: you know, they're going to try to float that and
Speaker 1: they may be successful. It's a powerful issue within the
Speaker 1: party among party voters in primaries. More next on Boomer Opinion.
Speaker 1: I'm Vonnie Quinn. Kevin McCarthy isn't a slam Don christ peaker.
Speaker 1: I mean, he likely get it, but he may have
Speaker 1: to do some negotiation. What kind of negotiations do you
Speaker 1: imagine we'll go on within the Republican Party in order
Speaker 1: to have them? Well, we don't, even though as I
Speaker 1: speak that Republicans definitely have the majority. I believe they
Speaker 1: will have the majority. I believe that the whole time.
Speaker 1: You just don't avoid a seat loss when you're a
Speaker 1: president's party. So assume that he gets a majority, but
Speaker 1: it's a slim majority. There's two steps right first, and
Speaker 1: this will come up next week on Monday and Tuesday,
Speaker 1: Republicans going to vote on who they're speaker candidate should be.
Speaker 1: So in order to do that, he has to win
Speaker 1: a majority of the House Republicans. But then he has
Speaker 1: to when on opening day of the new Congress January three,
Speaker 1: he's going to have to win a majority of the House.
Speaker 1: And if he has, say, if Republicans have a four
Speaker 1: or five or six seat margin, he has to hold
Speaker 1: all of the Republicans. In the old days, that was easy.
Speaker 1: It was an automatic vote. Everybody knew that you voted
Speaker 1: for your party's candidate for speaker. In recent years and
Speaker 1: among the among the House Freedom Caucus types, so you know, um,
Speaker 1: you those are not automatic votes. And the problem is
Speaker 1: that we also have with Democrats with I'm sorry, with
Speaker 1: Republicans picking up several seats in New York for example. Um,
Speaker 1: we have some Republicans who may be not eager to
Speaker 1: have a more extreme speaker, and so there's always a
Speaker 1: possibility will have chaos. The thing is that we've already
Speaker 1: had some of the extremists in the House Republican conference
Speaker 1: come out and say, I hope we have a narrow margin.
Speaker 1: Then I'll have more leverage. Well, the truth is that
Speaker 1: in real life, you don't have much leverage if you're
Speaker 1: on the extreme of your party. But they've been able
Speaker 1: to get away with that partially because the rest of
Speaker 1: the party lets them. We don't know whether they'll be
Speaker 1: able to get away with that in the next converse,
Speaker 1: and they may it if they do. If we have
Speaker 1: a slim Republican majority that's bossed by the thirty or
Speaker 1: forty or fifty or sixty most extreme members, it's kind
Speaker 1: of be a mess. Deinitely have to give up certain things,
Speaker 1: but I guess we may never know what they may be. Yeah,
Speaker 1: I mean, it's it's not really clear what he can
Speaker 1: promise or what, you know, what the demands are going
Speaker 1: to be, because a lot of these people are not
Speaker 1: calculating policy interested politicians. These are people whose main goal
Speaker 1: is to have grievances and and you know, and go
Speaker 1: on Fox News or you know, the radio talk shows
Speaker 1: or the more extreme networks and complain about things, including
Speaker 1: the leadership of the Republican Party. So I'm not sure
Speaker 1: what he can give some of the extremist members, because
Speaker 1: they're not interesting. You can't say, oh, yes, I'll give
Speaker 1: you a vote on this bill that you care about,
Speaker 1: because that's not what their thing is, that's not what
Speaker 1: they're interested in. And that's why the Republican Party is
Speaker 1: not very equipped to run the House. Well, speaking of
Speaker 1: members and senators that have had power over the last
Speaker 1: couple of years, does Joe managine have as much power
Speaker 1: as he had going forward? Um, you know, assuming that
Speaker 1: Democrats have a majority in the Senate, whether it's fifty
Speaker 1: or fifty one seats or even fifty two as possible
Speaker 1: right now, I think get the math in my head. Um,
Speaker 1: The thing is, if there's a Republican majority in the House,
Speaker 1: then know, anything that passes and becomes law is going
Speaker 1: to need a supermajority to get there, because you're going
Speaker 1: to have to have both Republicans and Democrats, because it's
Speaker 1: gonna have if anything that becomes law has to get
Speaker 1: through the republic, if it has to get through a
Speaker 1: Republican House, it's going to have to get Republican votes
Speaker 1: in the Senate. It's also gonna have to get Democratic
Speaker 1: votes in the Senate. So, you know, the same way
Speaker 1: that the Philip Uster kept him from being the swing
Speaker 1: vote on a lot of things. Um, of divided government
Speaker 1: will keep him from being the swing vote on a
Speaker 1: lot of things. That's well, his energy permitting bill then
Speaker 1: is in trouble. Well, that said some of the things
Speaker 1: that if he is an aggressive legislator, it's very possible
Speaker 1: that he could put together coalitions that are bipartisan coalitions
Speaker 1: on some things. We just don't know what has any
Speaker 1: chance to get through the House or representatives. Is the
Speaker 1: thing that's that's fascinating. The climate change was up there
Speaker 1: in terms of voter priorities. You know. I my general
Speaker 1: feeling all this stuff is to wait and look more
Speaker 1: carefully as more studies go out. You know, it's it's
Speaker 1: easy for voters to say stuff. Whether that means that
Speaker 1: and and it's it's interesting what's you know, what they
Speaker 1: tell posters is on the top of their minds. Whether
Speaker 1: that actually moved their votes or not is a much
Speaker 1: more complicated question and sometimes difficult to study. But you know,
Speaker 1: I think that general the polling over the years has
Speaker 1: shown that dealing with climate has been a popular position
Speaker 1: for the last at least decade. And I think one
Speaker 1: of the things that we get out of one of
Speaker 1: the ways to think about the election is that Republicans
Speaker 1: were very, very certain that their issues were wildly popular
Speaker 1: with voters, But it may be that they were wrong. Jonathan,
Speaker 1: candidate quality, particularly for Republicans. How big of an issue
Speaker 1: will it be? Will the more extreme candidates be dismissed
Speaker 1: now more quickly, or should we expect to see more
Speaker 1: fringe candidates and maybe not so fringe candidates, maga candidates
Speaker 1: running in primaries against other Republicans. You know, it's certainly
Speaker 1: true in the media aftermath that one of the things
Speaker 1: they're fixating on is candidate quality. Now, the question becomes,
Speaker 1: can you be a party of anti democratic conspiracy thinking
Speaker 1: and recruit decent candidates? So they didn't just by coincidence,
Speaker 1: have a unto lousy candidates. They had a bunch of
Speaker 1: lot of the candidates in part because their voters wanted
Speaker 1: to hear crazy conspiracy thinking, and in part because solid
Speaker 1: regular politicians weren't willing to run in Republican primaries because
Speaker 1: they didn't want to be beat up for saying things like, oh, yes,
Speaker 1: Joe Biden won the election. Yeah. So, you know, the
Speaker 1: thing is, it's it's easy to say, oh, we had
Speaker 1: a bunch of bad candidates, but the bad candidates weren't
Speaker 1: just a coincidence that happened to happen or that was
Speaker 1: It's not just about Donald Trump's bad judgment in endorsements.
Speaker 1: It's also about what the party is right now, and
Speaker 1: they have some deep problems, and the last of the
Speaker 1: first hours after the election, it could be worse in
Speaker 1: terms of what their reaction is, but we still have
Speaker 1: to see what it's going to be like. One of
Speaker 1: the things we've been speaking about over the last several
Speaker 1: weeks and months, Jonathan, is this idea that there will
Speaker 1: be a lot of investigations in a scenario where there's
Speaker 1: a Republican House majority. Now there is one, or there's
Speaker 1: very likely to be one, not as far the majority though,
Speaker 1: as we thought. Does that mean that some of these
Speaker 1: investigations will get forgotten about. I don't think so. I
Speaker 1: think my guess is that any kind of modesty about
Speaker 1: what happened will disappear very very rapidly in long House
Speaker 1: Republicans and as long as they have a majority, they're
Speaker 1: going to do what they would do if they had
Speaker 1: a fifty or seventy seat majority. Um, they may have
Speaker 1: some limitations in terms of what they could do on
Speaker 1: the House floor. In terms of impeachments, say they have
Speaker 1: a four seed margin, they may not be able to
Speaker 1: do a whole bunch of impeachments that have no basis
Speaker 1: in fact um, whereas if they had a sixty seed
Speaker 1: majority they probably could. Of course, those impeachments would go
Speaker 1: nowhere in the Senate because Democrats are you know, even
Speaker 1: if Democrats don't have a majority, they certainly will have
Speaker 1: enough votes to block conviction. But in terms of committee hearings,
Speaker 1: as long as Republicans have a majority, they will organize
Speaker 1: the committees, and they will fund the committees, and they
Speaker 1: will support investigations. And given who the people are who
Speaker 1: would possibly be chair of those committees, they're not going
Speaker 1: to be you know, sober investigations of you know, real
Speaker 1: wrongdoing or policy oriented. They're going to be going after
Speaker 1: whatever craziness that the Republican online media tells them to
Speaker 1: go after. I have to ask you about the special election.
Speaker 1: We know how much is at stake in this election.
Speaker 1: Thank you for being with me, and I'm grateful that
Speaker 1: we are together every step of the way. I wanted
Speaker 1: to thank you guys for hanging in And if you
Speaker 1: saw him, you have to go home. You can wake
Speaker 1: up tomorrow morning see that the new senator. But you
Speaker 1: great State of Georgia. A lot's going to happen between
Speaker 1: now and months time, obviously, but can want not to
Speaker 1: do better if there's another debate, for example, you know,
Speaker 1: I sort of would guess that, on the one hand,
Speaker 1: a inexperienced challenger who has had his qualifications questions might
Speaker 1: have some advantages over time as they yet more used
Speaker 1: to campaigning. However, it's not clear that herschel Walker is
Speaker 1: the kind of candidate that will improve over time. And
Speaker 1: you know, we've had a lot of scandals coming out
Speaker 1: about mirschell Walker, and there's every possibility that this is
Speaker 1: not the final scandal that we've seen about him. And
Speaker 1: having another month to have reporters digging and presumably opposition
Speaker 1: researchers digging into his past, who knows what could be
Speaker 1: turned up. So you know, I can't you know, I
Speaker 1: don't want to speculate too much, but I would say
Speaker 1: that anything that we normally think would be the case.
Speaker 1: Who knows in this situation, the libertarian vote in that
Speaker 1: state will also play a role, presumably, and also the
Speaker 1: fact that it's just one against one there's no sort
Speaker 1: of other you know, there's no governor's race being thought
Speaker 1: out that same day, for example. And you know, well,
Speaker 1: and the thing is that as of this moment, we
Speaker 1: don't know for sure that this will be the difference maker.
Speaker 1: If it is once again the majority of the Senate
Speaker 1: on the line, I would say that what we learned
Speaker 1: for two years ago is that when the majority of
Speaker 1: the senators on the line, interest in special elections in
Speaker 1: Georgia is very, very high, and I don't see any
Speaker 1: reason to think that would change this time. No, speaking
Speaker 1: of interest rising stars, it does seem like many of
Speaker 1: the governors were allowed to stay in place, or that
Speaker 1: perhaps leadership at state level was a little bit more
Speaker 1: robust than we might have thought in advance. Do you
Speaker 1: see any rising stars out there for either party? Well,
Speaker 1: you know, in Florida, which is becoming a much more
Speaker 1: republican state, the governor there one reelection by a very
Speaker 1: large margin, and you know, is now off on a
Speaker 1: presidential campaign. Will see how that goes. We had some
Speaker 1: new candidates on the Democratic side, the new governor of Maryland,
Speaker 1: who is very popular in New York, having on Robin
Speaker 1: Hood and he's very well known to the state Jerseum.
Speaker 1: You know, he's the third black governor to be elected
Speaker 1: ever in the United States. And we have the first
Speaker 1: and possibly the first and second lesbian governors in the
Speaker 1: United States, one in Massachusetts and possibly one in Oregon.
Speaker 1: And so, you know, breaking barriers is always a notable thing, um.
Speaker 1: And then we'll see how they how they fare in governing.
Speaker 1: It's certainly, um, one of the things that happened overall,
Speaker 1: as I speak, it may wind up being not such
Speaker 1: a bad election for Republicans if they do wind up
Speaker 1: with a Senate majority, which certainly could happen. Um. Maybe
Speaker 1: the Democrats have a slight edge in the Senate right now.
Speaker 1: But at the state level, there are four states that
Speaker 1: have new democratic unified government, and so they are going
Speaker 1: to be passing presumably some high priority democratic legislation and
Speaker 1: presumably some things that Democrats in the national scene will
Speaker 1: want to run on in the future. So that will
Speaker 1: be interesting. That's they're all a states, Massachusetts, Maryland, Michigan,
Speaker 1: and Minnesota, so that will be interesting too to see
Speaker 1: how some of those states. And also we do have
Speaker 1: you know, and we do have trying to think of
Speaker 1: other Republican standouts from from the elections. But certainly I
Speaker 1: think Fetterman is going to be an interesting national politicians.
Speaker 1: The new senator from Pennsylvania. I think the governor, the
Speaker 1: new governor of Pennsylvania Democrat is going to be interesting.
Speaker 1: We also have, in addition to Florida, we had governors
Speaker 1: re elected to a second term in um, in Michigan
Speaker 1: in particular, in other states where some of them you know,
Speaker 1: will now be looking presumably at the presidency either in
Speaker 1: so you know, that's where presidential candidates come from, and
Speaker 1: we'll start to see some of that. In terms of legislation,
Speaker 1: Are we likely to see more now in the lame
Speaker 1: dog session than we would have in a different scenario. Um,
Speaker 1: that's a good question. Um, if Democrats wind up winning
Speaker 1: in both Arizona and Nevada in the next couple of
Speaker 1: days and hold the Senate majority than truction, where is
Speaker 1: going to be in a much less urgent situation in
Speaker 1: terms of confirming judges and executive branch positions during the
Speaker 1: lame duck, which will free up some floor time for
Speaker 1: other things. Whether they do other things or not, I
Speaker 1: don't know. You know, I certainly think that they should
Speaker 1: deal with the debt limit. I think that's the number
Speaker 1: one priority, even higher really than judges, to get that
Speaker 1: at least off the table for the next two years,
Speaker 1: and preferably to permanently and um the debt limit wellally,
Speaker 1: since we don't fully know yet are we going into
Speaker 1: recession or and what would happen in that scenario, would
Speaker 1: there be some kind of stimulus coming from the federal government,
Speaker 1: And I think that's right that that you know, as
Speaker 1: we move through the end of the year, it is
Speaker 1: possible Democrats will not expect any stimulus to come out
Speaker 1: of a House that's led by Republicans, So anything that
Speaker 1: they want to get done would have to come there. Now,
Speaker 1: whether whether they're going to want to do stimulus given inflation,
Speaker 1: that's something that the economics portion of the party is
Speaker 1: going to have to weigh in on, and then you know,
Speaker 1: we'll see what the politicians feel about it. But you know,
Speaker 1: that certainly is exactly right something else that they may
Speaker 1: want to look at. Before the before the gas prices
Speaker 1: started to go back up again because well sort of
Speaker 1: fortuitous and also I mean, I guess self imposed that
Speaker 1: gas prices went down slightly because of the spr releases
Speaker 1: and so on, but that might become a problem again. Yeah,
Speaker 1: I mean, the gas prices were sort of weird because
Speaker 1: they had They did go up for a month and
Speaker 1: then headed back down, and that may have actually accounted
Speaker 1: for some of the UM surge in the polls Republicans
Speaker 1: that didn't that then didn't work out, didn't materialize. It's possible.
Speaker 1: It's that's very seculative at this point, but it is.
Speaker 1: You know, it certainly seems to have some correlation that
Speaker 1: gas prices have some correlation with approval ratings, and presumably
Speaker 1: um you voters who care about inflation seemed to fixate
Speaker 1: more on gas prices than anything else. Bloomberg Opinions Jonathan Bernstein,
Speaker 1: and do please weigh in. You can email me at
Speaker 1: v Quinn at Bloomberg dot net. We love to hear
Speaker 1: from you. Bloomberg Opinion airs every weekend on Bloomberg Radio
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