WEBVTT - Faster Economic Growth Requires Structural Reform, Buiter Says

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<v Speaker 1>Brought you by Bank of America Mary Lynch. Investing in

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<v Speaker 1>local communities, economies and a sustainable future. That's the power

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<v Speaker 1>of global connections, Mary Lynch, Pierce Fenner and Smith Incorporated

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<v Speaker 1>Member s I p C. Welcome to the Bloomberg Surveillance Podcast.

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<v Speaker 1>I'm Tom Keene with David Gura. Daily we bring you

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<v Speaker 1>insight from the best in economics, finance, investment and international relations.

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<v Speaker 1>Find Bloomberg Surveillance on iTunes, SoundCloud, Bloomberg dot Com, and

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<v Speaker 1>of course on the Bloomberg. We have a special guest

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<v Speaker 1>in London day Yes, Film Bowdery, the global chief economistic

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<v Speaker 1>City Group, joins us from there. We miss having him

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<v Speaker 1>here in our Bloomberg eleven three oh studios in New York,

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<v Speaker 1>but great to have you with us from London. There

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<v Speaker 1>is there is such symbolism to this moment when we

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<v Speaker 1>see this letter being delivered to Donald Tusk, the the

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<v Speaker 1>EU Council at present, what notionally changes as a result

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<v Speaker 1>of this, and indeed we have the symbolism what what's

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<v Speaker 1>going to change with regard to the economy When this

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<v Speaker 1>letter is delivered, the clock starts sticking unless a miracle

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<v Speaker 1>happens Britain will be out of the EU in two

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<v Speaker 1>years time, and so the diual concentrate mind. And we'll

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<v Speaker 1>see the opening bid of the British government in that letter,

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<v Speaker 1>and we'll get I think, also quite publicly with dispect

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<v Speaker 1>the initial response of the European Council and and the

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<v Speaker 1>Commission and indeed European Parliament, which of course has to

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<v Speaker 1>approve to hold you it really is a it's it's

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<v Speaker 1>a defining moment, uh. And I think those who I

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<v Speaker 1>hope it wouldn't happen or felt that it could happen

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<v Speaker 1>uh smoothly and without um any material pain for the

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<v Speaker 1>British economy, will, I think, have then those wrapped in

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<v Speaker 1>the unpalatable facts as the weeks become months. How worried

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<v Speaker 1>do you hear about the element of surprising that we've

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<v Speaker 1>heard quite a bit from Prime Minister Theresa May since

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<v Speaker 1>since this referendum she stuck to the timetable she set

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<v Speaker 1>out several months ago. Are are you worried about a

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<v Speaker 1>sort of surprise factor here in light of what we've

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<v Speaker 1>seen in the UK economy thus far. No, I think

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<v Speaker 1>the positions uh are pretty clear. The British government has

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<v Speaker 1>UH I think UH waded back from its uh Conservative

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<v Speaker 1>Party Conference rhetoric and it's embrace of the heart brekxhit.

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<v Speaker 1>It's clearly trying to UH find a way of getting

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<v Speaker 1>uh some interim agreement which phil have significant continuity for

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<v Speaker 1>British business. So I think there's uh at disappoint a little. UH.

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<v Speaker 1>I think I'm not surprised if you don't get an

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<v Speaker 1>early agreement on uh the existing EU citizens in the

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<v Speaker 1>UK and UK you on lordn Island and on the budget.

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<v Speaker 1>That would be a surprise. If they we do this

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<v Speaker 1>in two years, Professor Powder, it will be a century,

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<v Speaker 1>one hundred years from the Paris peace conference associated with Versailles.

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<v Speaker 1>I don't see David Lord, George of Vittorio Orlando, George

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<v Speaker 1>Clemenceau or Woodward Wilson in sight. How do negotiations actually occur?

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<v Speaker 1>I mean, what, how do you visualize negotiations? Have they

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<v Speaker 1>done it? Ah? You know, look kinto hotel in Brussels

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<v Speaker 1>or I mean, I mean, what's gonna be at the table.

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<v Speaker 1>Where's the table gonna be? There's no president for exactly, uh,

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<v Speaker 1>For all I know, they will be sitting in the

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<v Speaker 1>will their spaniord on the ground plus in Brussels. But

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<v Speaker 1>I think they'll probably UH meeting UH Commission premises or

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<v Speaker 1>something like that. It's doubt why they would assist on

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<v Speaker 1>on neutral territory sort of a demilitarized zone in the

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<v Speaker 1>middle of Brussels. Um the logistics are actually not going

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<v Speaker 1>to be that important. It's really uh the mandates the

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<v Speaker 1>negotiators will start with and be especially interesting to see

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<v Speaker 1>what the you know, the Commission and the Council come

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<v Speaker 1>up with in terms of guidelines and sort of opening positions.

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<v Speaker 1>That's the great uncertainty to be at this point. I

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<v Speaker 1>feel one of the soft data telling us now about

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<v Speaker 1>the UK economy, how is sentiment in the United Kingdom

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<v Speaker 1>about the Brexit and need what may follow after Well,

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<v Speaker 1>sentiment has been remarkably robust until quite recently. There is

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<v Speaker 1>some indication now that especially among Samese and very recently

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<v Speaker 1>also among uh major corporations Japanese among them making a

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<v Speaker 1>capital expands in FDI decisions, that they are looking at

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<v Speaker 1>ways of reducing the exposure to to Britain. But but

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<v Speaker 1>until now, consumer sentiment has been remarkably robust, and UH

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<v Speaker 1>as has a corporate sentiment the only place where we've

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<v Speaker 1>seen concern expressed and the anticipation of pain has been

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<v Speaker 1>the exchange rate, and ironically that is of cause helped

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<v Speaker 1>the rest of the economy. There's no question about that.

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<v Speaker 1>Let's come back with Villan Bouder in our London studios

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<v Speaker 1>and as most history outside of David, it was something

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<v Speaker 1>that the Prime Minister migrate by jaguar from ten Downing

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<v Speaker 1>Street over to Parliament. I mean there's that, you know,

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<v Speaker 1>for even for us from a distance, it's happening and

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<v Speaker 1>the se see the footage that are calling. Matt Miller

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<v Speaker 1>tweeted out as well of the the Ambassador to the

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<v Speaker 1>EU arriving in the jaguar as well, with that letter

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<v Speaker 1>in a briefcase soon to be delivered to the President

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<v Speaker 1>of the EU Council. Yeah, I mean I would have

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<v Speaker 1>gone in a range over land Rover Defender hic with

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<v Speaker 1>the Hunter boots looking very queenly out in the tundra.

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<v Speaker 1>David Gern Time Keena New York in our London studios,

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<v Speaker 1>Villain Powder of City, Professor Powder, help me here with

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<v Speaker 1>your great call on slower economic growth, on a global

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<v Speaker 1>slow down. What's gonna take for you to move your

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<v Speaker 1>vector I don't mean to get the gloom right, but

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<v Speaker 1>how do you get more optimistic? What do you need

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<v Speaker 1>to observe in the global economy that would get you

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<v Speaker 1>more optimistic about economic growth? Well, uh, from a sustained,

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<v Speaker 1>longer run active we would need UM structural reforms, UM,

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<v Speaker 1>more capital expenditure broadly defined, including infrastructure, human capital, and

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<v Speaker 1>I think an elimination of trade barriers and barriers of

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<v Speaker 1>mobility of laboring capital. So all these things. Uh, we're

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<v Speaker 1>moving into opposite direction. So that's unlikely to happen from

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<v Speaker 1>a short run cychnical perspective, but we uh, anything that

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<v Speaker 1>looks like a fiscal stimulus UM implemented or anticipated will

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<v Speaker 1>boost the level of activity. That's happened in the US

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<v Speaker 1>a certain extent or there was growing doubt about the

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<v Speaker 1>ability of administration to deliver the meaning for fiscal stimulus.

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<v Speaker 1>I think that particular source of animal spirits may be

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<v Speaker 1>wearing thin um and likewise less fiscal restraint in the

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<v Speaker 1>r Area Party as a result of a number of

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<v Speaker 1>key elections taking place. All that I think boosts economic

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<v Speaker 1>activity and the cycnical UH. In the cytical manner um,

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<v Speaker 1>that's not sustainable, of course, but it's nice. But at

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<v Speaker 1>last you mentioned that growing doubt, and I wonder what's

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<v Speaker 1>changed about your outlook here over the last week in

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<v Speaker 1>light of what we saw in Washington on Friday's we

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<v Speaker 1>saw that healthcare build being pulled off, the pulled off

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<v Speaker 1>the Congress's floor. It was just the ability to deliver right. Um,

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<v Speaker 1>we really has to look at the at Washington as

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<v Speaker 1>not having the Republicans in charge of the White House

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<v Speaker 1>and both Houses of Congress, but being you know, in

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<v Speaker 1>charge of both houses of Congress with an independent in

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<v Speaker 1>UH in the White House, and it's become clear that

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<v Speaker 1>the ability of the President and the Congress to deliver

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<v Speaker 1>key reforms is very questionable. And even within the Republicans

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<v Speaker 1>in the House and the Senate, there are these very

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<v Speaker 1>sharp divisions now. But have under mind speak of Ryan's

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<v Speaker 1>position is credibility. UH. The and the Freedom Caucus and

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<v Speaker 1>other tea parties are I think orthogonal both to Ryan

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<v Speaker 1>and and to Trump. So it just looks like a

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<v Speaker 1>bit of it is organized. Mess help us with this

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<v Speaker 1>strange word eurosclerosis. I mentioned it the other day and

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<v Speaker 1>got a nasty note from someone saying, oh, you're so gloomy.

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<v Speaker 1>The nominal GDP that City Group looks for for the

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<v Speaker 1>United States of America. Is it unique, separate and discreet

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<v Speaker 1>or is it just plain old simple eurosclerosis And you

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<v Speaker 1>mean the the low growth in the United States. Yes,

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<v Speaker 1>it's UH, partly, of course, reflection of of eighteen of demographics.

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<v Speaker 1>But on top of that, I think there is forty

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<v Speaker 1>years of progressive over regulation increasingly distortionary, and I think

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<v Speaker 1>UM UH distribution early and desirable taxation UM a legal

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<v Speaker 1>system that has made lawsuits so easy that the whole

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<v Speaker 1>ranges of human activity, including health care, are slowed down

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<v Speaker 1>and burdened with enormous costs. So the US is indeed

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<v Speaker 1>a country that is in deep seated supply side trouble

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<v Speaker 1>and needs UH both widespread deregulation and UM active tax

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<v Speaker 1>reforms and selective boosts in public expenditure on health, education

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<v Speaker 1>and infrastructure. So the country really has all its work

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<v Speaker 1>cut out for us for it. So Villain Batter thank

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<v Speaker 1>you so much, with City greatly appreciate particularly UH David

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<v Speaker 1>and I Agan, thank you for your work. The day

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<v Speaker 1>of the Netherlands election. That was really a special moment

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<v Speaker 1>brought to you by Bank of America Mary Lynch dedicated

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<v Speaker 1>to bringing our clients insights and solutions to meet the

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<v Speaker 1>challenges of a transforming world. That's the power of global connections.

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<v Speaker 1>Mary Lynch, Pierce, Fenner and Smith Incorporated, Member s I

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<v Speaker 1>p C. On this historic day for the United Kingdom,

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<v Speaker 1>Daniel Jurgen, Professor Jurgen, Dr Jurgen Rather The Commanding Heights

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<v Speaker 1>is the iconic book on the ascent of the United Kingdom.

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<v Speaker 1>This is not a United Kingdom. Clement at Lee would

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<v Speaker 1>know at the end of World War to the Prime

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<v Speaker 1>Minister gave a rousing speech today, what is the perspective

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<v Speaker 1>you can give on how these negotiations will go? For

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<v Speaker 1>Prime Minister May, given the sprawl from nineteen fifty two,

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<v Speaker 1>all of the trade discussions of you the Union, what

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<v Speaker 1>is the perspective today forward? I think that the good

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<v Speaker 1>Morning Tom. I think that the phony war that's going

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<v Speaker 1>on for the last ten months about Brexit, of course

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<v Speaker 1>it's now the real war has begun, and I think

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<v Speaker 1>it's going to be a big and tough struggle. No

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<v Speaker 1>one really knows how it's going to go. The EU

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<v Speaker 1>is proposing a sixty uh dollar bill to UH to Britain,

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<v Speaker 1>and I think it's what's at stake, of course, is

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<v Speaker 1>not only for Britain, but is for the EU, which

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<v Speaker 1>is dealing with the stresses that come from the common

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<v Speaker 1>having a common currency that isn't backed up by common institutions,

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<v Speaker 1>the euro, and compounded by the open borders. So I

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<v Speaker 1>mean for for the EU as much as Britain. This

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<v Speaker 1>incogation so essential because it's also about the future of

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<v Speaker 1>the EU. Where is the commanding heights of Europe? Is

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<v Speaker 1>it a Chancellor Miracle's desk? At this point it has been.

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<v Speaker 1>Germany has been really the political and economic engine that

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<v Speaker 1>has kept the whole thing together. Her position thought have

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<v Speaker 1>been weakened by the influx of million migrants, but the

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<v Speaker 1>Germans did well in the most recent UH elections her party,

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<v Speaker 1>So she is the you know, she is the kind

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<v Speaker 1>of personification of Europe right now, particularly with this potential

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<v Speaker 1>disarray in France. M hm. There was a remarkable moment

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<v Speaker 1>in the speech, I thought when Prime Minister Theresa May said,

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<v Speaker 1>perhaps more than ever, the world needs the democratic, liberal

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<v Speaker 1>values of Europe. And you heard the jeering and the

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<v Speaker 1>laughter from the backbenches in parliament. What did you make

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<v Speaker 1>of that line? What did you make of the overtures

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<v Speaker 1>that the Prime Minister made to the greater European community

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<v Speaker 1>in the speech today, Well, I think she's uh, you know,

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<v Speaker 1>she has to play a very complex hand here in

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<v Speaker 1>terms of what what part of Europe or europe connections

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<v Speaker 1>will remain, and so uh, you know, that's an olive

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<v Speaker 1>branch in a way to the uh, to the Europeans. Uh.

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<v Speaker 1>You know, I'm sure that line was very carefully crafted

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<v Speaker 1>as they begin these really tough negotiations for which there's

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<v Speaker 1>no precedent. What's the best case scenario here for a deal?

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<v Speaker 1>I imagine the best cases one that's concluded or agreed

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<v Speaker 1>upon within this two year period. But what are you

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<v Speaker 1>looking for when when when you think of what a

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<v Speaker 1>good deal for for the UK and the EU might

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<v Speaker 1>be Well, for the UK, I think it would be

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<v Speaker 1>a way to continue to be active in almost in

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<v Speaker 1>a free trade like way with the EU, sort of

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<v Speaker 1>going back to what the European Community was a trading group,

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<v Speaker 1>and to maintain the financial position of London as a

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<v Speaker 1>as a as as the basis for Europe. I think

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<v Speaker 1>for the EU, the stakes really are to make sure

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<v Speaker 1>that this is not the first as many uh, and

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<v Speaker 1>that this doesn't seed populism. And I'll tell you, uh,

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<v Speaker 1>you know, the French elections will be so so critical

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<v Speaker 1>uh to what happens next on oil, And of course

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<v Speaker 1>everybody wants to know what, Daniel, you're going to think oil.

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<v Speaker 1>Let's bring the two together. Oil in Scotland. The North

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<v Speaker 1>Sea isn't the North Sea of the Commanding Heights, is it? No,

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<v Speaker 1>it's quite different. You know, when they had the Scottish referendum,

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<v Speaker 1>which was very close of two years ago, it was

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<v Speaker 1>when oil was still a hundred dollars a barrel. I've

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<v Speaker 1>often wondered how that vote would have gone when oil

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<v Speaker 1>was forty or fifty dollars a barrel, because part of

0:16:09.080 --> 0:16:11.840
<v Speaker 1>Scottish nationalism has always been well it's our oil and

0:16:11.920 --> 0:16:15.360
<v Speaker 1>we'll get the oil. And uh, but in a lower

0:16:15.440 --> 0:16:19.680
<v Speaker 1>price range Scotland, you know that it doesn't have that

0:16:20.640 --> 0:16:26.680
<v Speaker 1>fiscal advantage that comes from higher priced oil. So um, uh,

0:16:27.160 --> 0:16:30.320
<v Speaker 1>you know it's a question of the Scottish Parliament may

0:16:30.440 --> 0:16:32.400
<v Speaker 1>vote that they want a referendum, but that doesn't mean

0:16:32.440 --> 0:16:36.560
<v Speaker 1>that they'll necessarily be a referendum. I should say so

0:16:36.720 --> 0:16:39.240
<v Speaker 1>for Theresa May, this is really a two front War

0:16:39.440 --> 0:16:42.600
<v Speaker 1>one is one of Brussels and the others with Edinburgh.

0:16:43.120 --> 0:16:44.880
<v Speaker 1>I'm putting, are these e I A data will get

0:16:44.920 --> 0:16:50.160
<v Speaker 1>today at three Wall Street times and putting will never

0:16:50.280 --> 0:16:52.360
<v Speaker 1>come on the show. And yet and folded into the

0:16:52.440 --> 0:16:55.960
<v Speaker 1>conversation that was dominant. I didn't say which data? Did

0:16:56.000 --> 0:16:59.040
<v Speaker 1>you say the data the ID and folded into the

0:16:59.040 --> 0:17:01.080
<v Speaker 1>conversation You hadn't to a couple of weeks back at

0:17:01.080 --> 0:17:03.120
<v Speaker 1>your your Sarah conference that you know what we heard

0:17:03.160 --> 0:17:05.760
<v Speaker 1>from the Saudio oil ministry there. Well, it was very

0:17:05.840 --> 0:17:08.560
<v Speaker 1>interesting because of course, Uh, when we began the conference,

0:17:08.560 --> 0:17:11.680
<v Speaker 1>the oil price was up from what had been when

0:17:11.720 --> 0:17:13.920
<v Speaker 1>we helped sire a week the year earlier. By the

0:17:14.040 --> 0:17:16.000
<v Speaker 1>end of the week the oil price was down ten percent.

0:17:16.320 --> 0:17:20.240
<v Speaker 1>Not connected to the conference, I think to to UH,

0:17:21.040 --> 0:17:24.000
<v Speaker 1>because we have the Saudi minister, the Russian minister, UH,

0:17:25.240 --> 0:17:27.520
<v Speaker 1>the Secretary General of OPEC, the head of i A there,

0:17:28.160 --> 0:17:31.080
<v Speaker 1>and you know the message was that this OPAC not

0:17:31.240 --> 0:17:35.639
<v Speaker 1>OPE agreement is really going to going to hold. But UH,

0:17:36.080 --> 0:17:39.120
<v Speaker 1>as you point to inventories, you know that they said

0:17:39.160 --> 0:17:42.359
<v Speaker 1>the key metric if that they'll be looking at is inventories,

0:17:42.400 --> 0:17:46.879
<v Speaker 1>and inventories remain high. I think that. Um. What was

0:17:46.960 --> 0:17:49.560
<v Speaker 1>already clear in Houston is that the next key day

0:17:49.960 --> 0:17:53.920
<v Speaker 1>is May when OPEC meets, and I think coming out

0:17:54.000 --> 0:17:57.639
<v Speaker 1>of this meeting this weekend, Wait, they're signaling that, Uh

0:17:58.000 --> 0:18:01.960
<v Speaker 1>they really if if they don't extend their six months agreements,

0:18:02.040 --> 0:18:05.240
<v Speaker 1>six months goes by quickly. Uh, that would put a

0:18:05.480 --> 0:18:08.480
<v Speaker 1>new pressure on the oil price, particularly, I should say,

0:18:08.760 --> 0:18:10.879
<v Speaker 1>with the amount that US producers have been able to

0:18:11.000 --> 0:18:14.200
<v Speaker 1>hedge their production forward. Dr. You're gonna honor to have

0:18:14.320 --> 0:18:16.280
<v Speaker 1>you on with this, for this historic to have United

0:18:16.359 --> 0:18:20.600
<v Speaker 1>Kingdom folks, I'll put out on Twitter, Yurgens. The Commanding

0:18:20.760 --> 0:18:36.200
<v Speaker 1>Heights can't say enough about it. We are in the

0:18:36.400 --> 0:18:39.400
<v Speaker 1>edge of April, and April in any in all cases

0:18:39.480 --> 0:18:42.840
<v Speaker 1>means the meetings of the International Monetary Fund will of

0:18:42.880 --> 0:18:45.680
<v Speaker 1>course give you complete coverage of that. We begin today

0:18:45.720 --> 0:18:49.680
<v Speaker 1>with the publication of Fiscal Politics and are honor to

0:18:49.760 --> 0:18:55.040
<v Speaker 1>bring you Vito gas Bar with the International Monetary UH Fund.

0:18:55.359 --> 0:19:00.840
<v Speaker 1>Dr gaspar good morning, going within your wonder document and

0:19:01.040 --> 0:19:05.439
<v Speaker 1>thoughtful two plus excuse me, four hundred plus pages. Uh,

0:19:05.600 --> 0:19:08.640
<v Speaker 1>could you please tell me what you learned about austerity?

0:19:09.119 --> 0:19:11.320
<v Speaker 1>You know, I look at the history being made by

0:19:11.400 --> 0:19:14.399
<v Speaker 1>Prime Minister made today, I look at the challenges of

0:19:14.480 --> 0:19:17.280
<v Speaker 1>Europe and that word from three or four years ago

0:19:17.480 --> 0:19:22.920
<v Speaker 1>was austerity. How does austerity fold into our political fiscal

0:19:23.520 --> 0:19:31.680
<v Speaker 1>or our fiscal politics? So, Tom, Uh, the UH political

0:19:31.760 --> 0:19:36.840
<v Speaker 1>economy aspects. The link between politics and economics was a

0:19:37.000 --> 0:19:40.960
<v Speaker 1>tradition UH in economics up to the beginning of the

0:19:41.040 --> 0:19:47.240
<v Speaker 1>twentieth century. That tradition has been a little bit lost recently,

0:19:48.240 --> 0:19:52.840
<v Speaker 1>and about two years ago, UH we decided at the

0:19:52.920 --> 0:19:57.480
<v Speaker 1>Fiscal Affairs Department of the International Monetary Fund that looking

0:19:57.760 --> 0:20:01.640
<v Speaker 1>at the relation between polit tics and economics in general,

0:20:02.040 --> 0:20:08.200
<v Speaker 1>and especially the relation between politics and fiscal policy was key,

0:20:08.720 --> 0:20:13.320
<v Speaker 1>and so we launched this project that is now come

0:20:13.560 --> 0:20:19.840
<v Speaker 1>to the presentation of this book that includes three parts

0:20:20.000 --> 0:20:26.280
<v Speaker 1>and nineteen chapters on a very wide variety of topics

0:20:26.560 --> 0:20:33.320
<v Speaker 1>on fiscal policy and politics. Unfortunately, we don't have a

0:20:33.480 --> 0:20:40.440
<v Speaker 1>special focus on austerity, but we do have quite a

0:20:40.600 --> 0:20:46.320
<v Speaker 1>lot on how one should think about the political conditions

0:20:46.680 --> 0:20:55.000
<v Speaker 1>that allow governments to UH follow sound countersyclical fiscal policies,

0:20:55.520 --> 0:20:59.720
<v Speaker 1>which is a key priority today. I hope Tom that

0:21:00.119 --> 0:21:03.600
<v Speaker 1>given that we launched this program, this project two years ago,

0:21:04.240 --> 0:21:07.640
<v Speaker 1>you will concede to us that we got our timing

0:21:08.280 --> 0:21:12.960
<v Speaker 1>more or less right. No, Tom Hm. One of the

0:21:13.040 --> 0:21:15.119
<v Speaker 1>chapters of the nineteen that stood out to me is

0:21:15.119 --> 0:21:17.840
<v Speaker 1>one that you authored here on lessons that the European

0:21:17.920 --> 0:21:21.119
<v Speaker 1>Union can learn from early American history. Give us the

0:21:21.200 --> 0:21:23.800
<v Speaker 1>crisis of that what what? What lessons are there to

0:21:23.840 --> 0:21:25.800
<v Speaker 1>be learned from what happened in this country when it

0:21:25.840 --> 0:21:32.320
<v Speaker 1>comes to supernational fiscal policy. Oh, that experience is absolutely fascinating.

0:21:32.640 --> 0:21:37.000
<v Speaker 1>So if you go to the beginning of the US

0:21:37.200 --> 0:21:43.840
<v Speaker 1>administration with Alexander Hamilton's so in a seventeen seventeen eighty

0:21:43.960 --> 0:21:49.399
<v Speaker 1>nine Hamilton's already benefited from the US Constitution. One of

0:21:49.560 --> 0:21:53.800
<v Speaker 1>the innovations from the US Constitution was that the federal

0:21:53.920 --> 0:21:59.119
<v Speaker 1>government was given the power to tax. Since that power

0:21:59.560 --> 0:22:05.159
<v Speaker 1>was no longer disputed, the federal government had the ability

0:22:05.320 --> 0:22:11.840
<v Speaker 1>to generate the revenues necessary to service and repay the

0:22:12.040 --> 0:22:17.840
<v Speaker 1>very large debts that had been accumulated during the War

0:22:18.200 --> 0:22:25.640
<v Speaker 1>of Independence. And Alexander Hamilton's was extremely systematic in building

0:22:26.359 --> 0:22:31.280
<v Speaker 1>the new US federal administration that, of course did not

0:22:32.400 --> 0:22:38.119
<v Speaker 1>exist before. He built up the US tax capacity at

0:22:38.160 --> 0:22:42.320
<v Speaker 1>the federal level completely from scratch, and one of the

0:22:42.560 --> 0:22:47.320
<v Speaker 1>aspects that I developed more in this paper is that

0:22:47.720 --> 0:22:53.320
<v Speaker 1>he set up the conditions UH that allow US Treasury

0:22:53.440 --> 0:22:59.000
<v Speaker 1>bonds to become the ultimate safe asset in the US

0:22:59.200 --> 0:23:04.320
<v Speaker 1>and a cord or stone of the US financial system.

0:23:05.000 --> 0:23:09.520
<v Speaker 1>And that is the part which I believe is more

0:23:10.080 --> 0:23:15.000
<v Speaker 1>relevant for European integration. Today, we're gonna we have breaking news, sir,

0:23:15.119 --> 0:23:16.800
<v Speaker 1>so we're gonna have to leave it short. But Vitur

0:23:16.880 --> 0:23:21.520
<v Speaker 1>Gaspar congratulations on this work from the International Monetary Fund.

0:23:21.800 --> 0:23:25.440
<v Speaker 1>Fiscal politics really beginning to kick off the view of

0:23:25.520 --> 0:23:28.240
<v Speaker 1>international economics that focuses on the World Bank and i

0:23:28.400 --> 0:23:39.600
<v Speaker 1>m F meetings here in the end of April. Thanks

0:23:39.640 --> 0:23:44.040
<v Speaker 1>for listening to the Bloomberg Surveillance podcast. Subscribe and listen

0:23:44.160 --> 0:23:49.480
<v Speaker 1>to interviews on iTunes, SoundCloud, or whichever podcast platform you prefer.

0:23:50.240 --> 0:23:53.080
<v Speaker 1>I'm out on Twitter at Tom Keene. David Gura is

0:23:53.240 --> 0:23:57.000
<v Speaker 1>at David Gura. Before the podcast, you can always catch

0:23:57.119 --> 0:24:13.640
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0:24:13.720 --> 0:24:17.919
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