WEBVTT - Tillerson Is Making a Mistake by Skipping NATO, Stavridis Says 0:00:00.120 --> 0:00:02.920 Brought you by Bank of America, Mary Lynch. Investing in 0:00:03.000 --> 0:00:07.840 local communities, economies and a sustainable future. That's a power 0:00:08.080 --> 0:00:12.360 of global connections. Mary Lynch, Pierce Fenner and Smith Incorporated 0:00:12.760 --> 0:00:27.400 Member s I p C. Welcome to the Bloomberg Surveillance Podcast. 0:00:27.840 --> 0:00:31.520 I'm Tom Keen with David Gura. Daily we bring you 0:00:31.560 --> 0:00:36.600 insight from the best in economics, finance, investment, and international relations. 0:00:37.000 --> 0:00:41.600 Find Bloomberg Surveillance on iTunes, SoundCloud, Bloomberg dot Com, and 0:00:41.680 --> 0:00:49.200 of course on the Bloomberg Friends of the Quad in London. 0:00:49.800 --> 0:00:52.120 I'm Tom Keene in New York and we celebrate today 0:00:52.159 --> 0:00:56.360 the Leader's Bookshelf. It is a book by Admiral James 0:00:56.360 --> 0:01:00.640 Travitas of Tufts and the Fletcher School, and I'm gonna 0:01:00.640 --> 0:01:06.320 tell you it's totally original. It is beyond original. Admiral Stevinus, 0:01:06.400 --> 0:01:12.080 congratulations on the book. Chapter two, making time for reading 0:01:12.120 --> 0:01:15.160 before you go into many many people in the military 0:01:15.200 --> 0:01:18.240 and what book change their lives and is important to 0:01:18.240 --> 0:01:21.080 them for leadership. How do you make time for reading, 0:01:21.440 --> 0:01:24.319 Admiral Stevinus, If we don't have a lecture being stuck 0:01:24.319 --> 0:01:28.240 on a destroyer's Yeah, if you can't go out to 0:01:28.280 --> 0:01:31.240 sea for extended forward deployments. There are other things you 0:01:31.280 --> 0:01:34.240 can do, tom, So I would start by saying you 0:01:34.280 --> 0:01:39.120 can use your downtime productively. So often on an airplane, 0:01:39.120 --> 0:01:42.039 for example, we just kind of default to a glass 0:01:42.080 --> 0:01:44.480 of Scotch and a couple of movies, but you know 0:01:44.600 --> 0:01:50.560 that's incredibly valuable real estate. Secondly, when you are traveling 0:01:50.600 --> 0:01:54.640 in the car audio books are incredibly powerful, and I 0:01:54.640 --> 0:01:57.760 would say a third trick of the trade with reading 0:01:58.480 --> 0:02:04.120 is to read books quickly, obviously, but also to um 0:02:04.480 --> 0:02:07.280 dive in deep when you find a book that really 0:02:07.360 --> 0:02:11.080 has meanings. So skim a lot of books in order 0:02:11.120 --> 0:02:16.200 to read powerfully a handful of books. An't well, what 0:02:16.240 --> 0:02:18.400 was the strangest thing when you were writing the book? 0:02:18.440 --> 0:02:21.320 Is there a book that you saw over and over? 0:02:21.440 --> 0:02:23.079 I know I speak to a lot of CEOs here 0:02:23.280 --> 0:02:25.400 in the UK, and actually I'm surprised I always look 0:02:25.400 --> 0:02:29.560 at military books when talking about business. Yeah. One that 0:02:29.720 --> 0:02:33.160 jumps out for business people is The Art of War 0:02:33.320 --> 0:02:37.840 by Sun Sue, who was an ancient strategist, and he 0:02:37.880 --> 0:02:41.639 talks a lot about innovation, about cleverness, about trying to 0:02:41.680 --> 0:02:44.920 get behind your enemy. The Jiu jitsu of war, which 0:02:44.960 --> 0:02:47.920 certainly all applies in business. We often forget though, that 0:02:48.040 --> 0:02:52.160 Sun Sus said went on death ground fight, which is 0:02:52.320 --> 0:02:55.519 about the determination you have to have as a CEO. 0:02:55.720 --> 0:02:59.840 At times do people ask you a question of what 0:03:00.000 --> 0:03:02.840 are they? You know? They should be reading secrets because 0:03:03.080 --> 0:03:05.320 it's it's now a bad thing being an intellectual or 0:03:05.320 --> 0:03:10.000 an academic, you know. I don't think reading books has 0:03:10.040 --> 0:03:13.600 gone out of style. As I motor around and talked 0:03:13.600 --> 0:03:16.960 to a wide variety of people, and that's one of 0:03:16.960 --> 0:03:19.280 the nice things not being the dean of a graduate school. 0:03:19.320 --> 0:03:21.960 You get to speak to people all around the world. 0:03:22.360 --> 0:03:25.639 People still read and they want to exchange book ideas. 0:03:25.880 --> 0:03:28.320 And a great way to start any conversation is what 0:03:28.360 --> 0:03:31.320 are you reading these days? Well, I'll go with that 0:03:31.440 --> 0:03:35.240 and dive into the book. I mentioned this earlier. Thomas 0:03:35.240 --> 0:03:39.000 Hayward one of our great admirals, and there's there's memos 0:03:39.000 --> 0:03:41.240 from you, Lewisy's grand he goes to World War two 0:03:41.280 --> 0:03:44.280 and nimits I mean, and that there's that fear I 0:03:44.280 --> 0:03:46.640 think in a lot of kids today not to go 0:03:46.720 --> 0:03:50.640 back into our history to find the books to read. 0:03:50.680 --> 0:03:53.240 There's something I can't read a book that's twenty years old, 0:03:53.400 --> 0:03:56.120 like the new book, John Tucker, I'm reading Bard Schwartz 0:03:56.480 --> 0:03:59.640 on the Supreme Court from twenty four years ago, and 0:03:59.720 --> 0:04:03.360 yet it's like it was written yesterday. I think that's 0:04:03.400 --> 0:04:06.040 true of so many books. And I'll make another point, Tom, 0:04:06.080 --> 0:04:08.880 which is that a book you read in your twenties 0:04:09.360 --> 0:04:11.640 and get a lot out of at that point in time, 0:04:11.680 --> 0:04:15.160 say A Connecticut Yankee and King Arthur's Court by Mark Twain. 0:04:15.680 --> 0:04:17.880 I went back and read that book again in doing 0:04:17.880 --> 0:04:21.640 the Leader's Bookshelf and got an incredibly different experience out 0:04:21.640 --> 0:04:25.360 of it. So there's real power in reading a nineteenth 0:04:25.400 --> 0:04:27.920 century book, and even when you've read in your youth, 0:04:28.040 --> 0:04:30.840 picking it up again. And now we go sensitive with 0:04:30.960 --> 0:04:36.480 James Travitas page Are you kidding me? A River Runs 0:04:36.560 --> 0:04:43.800 through It? Norman McLean Grog Johnson recommended this one. Uh. 0:04:43.880 --> 0:04:47.880 A River Runs through It is a marvelous book about families. 0:04:48.080 --> 0:04:50.880 And part of a leader's job is life balance, Tom, 0:04:50.880 --> 0:04:53.719 and I bet many of your CEOs and senior business 0:04:53.720 --> 0:04:57.080 people listening want to try to understand how to attain 0:04:57.560 --> 0:05:01.120 a balance in life. Not everything is about out making 0:05:01.160 --> 0:05:05.160 money and building your resume. And the novel a river 0:05:05.279 --> 0:05:08.640 runs through. It is about a troubled family in Montana 0:05:08.760 --> 0:05:11.200 and how they work through some of the great challenges 0:05:11.279 --> 0:05:15.240 that impact them. I think it's also just a spectacularly 0:05:15.400 --> 0:05:19.360 written book, like reading poetry page after page. Yeah, I 0:05:19.720 --> 0:05:22.440 like you know, there's a definitely theme, Admiral, when I 0:05:22.640 --> 0:05:24.720 go through your book the leader's bookshelf is that it's 0:05:24.760 --> 0:05:28.040 all about preparation. And so maybe it's also a good 0:05:28.080 --> 0:05:31.039 idea for a lot of businessmen to read books a 0:05:31.040 --> 0:05:33.840 little bit more like army generals, because you can't leave 0:05:33.880 --> 0:05:38.120 anything to hope or chance. That's exactly right, Francine. And 0:05:38.200 --> 0:05:42.000 let's face it, um, our lives are preparation and we 0:05:42.080 --> 0:05:45.400 get a chance to build ourselves as leaders by the 0:05:45.440 --> 0:05:48.040 gifts were given. Are you tall and good looking? Which 0:05:48.120 --> 0:05:51.880 I am not? But do you get parents who nurture 0:05:51.920 --> 0:05:54.920 you and bring you along? Um? Do you have experiences? 0:05:55.000 --> 0:05:58.080 But the one consistent thing you can do you have 0:05:58.160 --> 0:06:01.599 control over, is to read, and to read consciously, to 0:06:01.640 --> 0:06:04.560 try and learn leadership as you read, by using these 0:06:04.560 --> 0:06:09.240 books almost as simulators, to put yourself in other leadership situations. 0:06:09.320 --> 0:06:12.440 It is all about preparation when you look at the 0:06:12.480 --> 0:06:15.080 state of politics. But also the state of diplomacy around 0:06:15.080 --> 0:06:17.960 the world. Can we actually look back at history and 0:06:18.080 --> 0:06:21.800 books on this or is two thousand and seventeen different. No. 0:06:22.120 --> 0:06:24.680 I think I'll give you two books that I think 0:06:25.000 --> 0:06:30.960 provide marvelous lessons, one positive, one negative. UM Winston Churchill's 0:06:31.000 --> 0:06:34.839 The Second World War, which is really a series of books, 0:06:34.920 --> 0:06:40.039 but it's it's the story of coalition building and determination 0:06:40.120 --> 0:06:45.480 and overcoming enormous challenges. UM. Very inspirational read. On the 0:06:45.520 --> 0:06:50.160 negative side, the current National Security Advisor, Lieutenant General H. R. 0:06:50.279 --> 0:06:55.520 McMaster wrote a book about the Vietnam War called Dereliction 0:06:55.600 --> 0:06:58.800 of Duty of the Failure of the generals to speak 0:06:58.839 --> 0:07:02.240 truth to power. UM. Both of those books I think 0:07:02.240 --> 0:07:06.239 are examples of UH stories that help us be better leaders. 0:07:06.640 --> 0:07:09.080 And now we go to the question that only matters 0:07:09.400 --> 0:07:12.440 to all listening, Amristavite, is how do we get our 0:07:12.520 --> 0:07:15.640 kids to read? What's what's the what's the secret to 0:07:15.680 --> 0:07:21.040 get them off minecraft? Well, first of all, I would 0:07:21.040 --> 0:07:23.920 say you have to talk books with your kids and 0:07:24.400 --> 0:07:27.320 get put good ideas of books in front of them. Secondly, 0:07:27.880 --> 0:07:31.720 use electronics. This is a generation that doesn't resonate like 0:07:31.760 --> 0:07:33.800 you and I do. Tom to picking up a dusty 0:07:33.880 --> 0:07:37.080 volume of The Rise and Fall of the Third Reich. Um, 0:07:37.200 --> 0:07:39.360 but they're happy to pick up a kindle and learn 0:07:39.400 --> 0:07:41.880 to read on that. You can also read very effectively 0:07:41.920 --> 0:07:45.480 on an iPhone, So give the kids electronic options for reading. 0:07:45.840 --> 0:07:49.600 And thirdly, use the tie into movies and videos. Um. 0:07:49.680 --> 0:07:52.560 What often sparks a young persons having seen a movie 0:07:52.640 --> 0:07:56.040 like Enders Game, say gosh, you like that movie, why 0:07:56.040 --> 0:07:58.360 don't you read the novel? So there's three things you 0:07:58.360 --> 0:08:01.600 can try. I'm me, I'm very European today. I feel 0:08:01.640 --> 0:08:04.880 very European. Where was Macavelli and all of this? Did 0:08:04.880 --> 0:08:09.160 anyone mention the Prince and Machiavelli? Um? Machiavelli is in 0:08:09.400 --> 0:08:12.840 our just outside the top fifty Francine, But I think 0:08:12.880 --> 0:08:15.920 fell behind Sun Sue in the Art of War, which 0:08:16.000 --> 0:08:18.720 is probably a metaphor for Asia and Europe these days. 0:08:19.280 --> 0:08:21.400 I want to go to one book and we'll talk 0:08:21.440 --> 0:08:23.640 current events here where that was to vetus after we 0:08:23.720 --> 0:08:28.120 celebrate the leader's bookshelf, and this goes right to the 0:08:28.200 --> 0:08:32.480 President Lee's lieutenants. A study in Command Douglas South of 0:08:32.600 --> 0:08:36.840 Freedom Freeman, absolutely classic World War Two vintage book. General 0:08:36.920 --> 0:08:40.440 Conway gave this to you from the U. S. Marine Corps. Boy, 0:08:40.440 --> 0:08:43.760 do we need some Lee's lieutenants right now? We do? 0:08:44.040 --> 0:08:47.720 And I'm gonna throw right back at you, agreeing with you. Um. 0:08:47.800 --> 0:08:52.400 The compliment to it is Doris Kern's Goodwins, just magisterial 0:08:52.520 --> 0:08:58.080 book on Lincoln's uh team of rivals that he put together. Um, boy, 0:08:58.120 --> 0:09:01.840 Lincoln has some powerful lessons for our president, I think, um, 0:09:02.040 --> 0:09:06.360 a sense of humor, a sense of humility, Um, of 0:09:06.559 --> 0:09:10.040 breaching out across not only the aisle, but across personality. 0:09:10.120 --> 0:09:13.120 In a very important book because at the time Admirals 0:09:13.160 --> 0:09:16.320 to Venus is amidshipman was on the monitor of the Merrimacame, 0:09:17.040 --> 0:09:20.800 which one of the two admiral One more book question 0:09:20.880 --> 0:09:24.240 before we get to the snub of NATO. Is this 0:09:24.440 --> 0:09:27.120 library on the cover of your book? Is this is 0:09:27.320 --> 0:09:32.840 Travenas Library? Don't I wish? No, that's the library at 0:09:32.920 --> 0:09:37.200 Johns Hopkins University. Isn't it beautiful? It is gorgeous. It is. 0:09:37.480 --> 0:09:39.080 When I first saw the photo, I thought it was 0:09:39.080 --> 0:09:43.160 an old British library. But it's right here in colonial America. Yeah, 0:09:43.160 --> 0:09:45.800 I know. And Professor Cole Over Columbia would talk of 0:09:45.880 --> 0:09:50.560 Johns Hopkins and Chicago is being two of our great institutions. Okay, 0:09:50.600 --> 0:09:53.360 let's get serious. U fell apart today on TV. What 0:09:53.480 --> 0:09:56.120 a is snub? The Secretary of Treasury of State rather 0:09:56.480 --> 0:10:01.600 will not visit the NATO meetings is for NATO meetings, 0:10:01.640 --> 0:10:03.319 and I guess they'll go on a junk at the 0:10:03.360 --> 0:10:07.080 Russia China. I don't know translate this for the I 0:10:07.280 --> 0:10:11.000 R community. What does it symbolize? Well, it's just a mistake. 0:10:11.200 --> 0:10:14.920 When you, uh, when you begin a new administration, a 0:10:15.000 --> 0:10:16.560 new role, you want to kind of work from the 0:10:16.640 --> 0:10:20.040 inside out. You want to kind of begin with your 0:10:20.400 --> 0:10:23.640 closest allies and then out to your partners, then out 0:10:23.679 --> 0:10:27.280 to your friends. Then, having consolidated the base a term 0:10:27.360 --> 0:10:31.600 of political administration, not understand, you then start working with 0:10:31.640 --> 0:10:35.160 your opponents and those with whom you disagree. So it's 0:10:35.160 --> 0:10:38.080 not only Frankly he's going to go to Russia potentially, 0:10:38.120 --> 0:10:40.280 but he's going to miss the meeting in order to 0:10:40.520 --> 0:10:43.520 have a meeting with President g at a summit with 0:10:43.960 --> 0:10:47.199 President Trump. I just think it's a mistake. At a minimum, 0:10:47.520 --> 0:10:49.160 we ought to go to NATO and ask them to 0:10:49.200 --> 0:10:53.080 move the dates for the meeting, but to simply not attend. 0:10:53.160 --> 0:10:56.840 I think is UH is diplomacy one oh one violation? 0:10:57.280 --> 0:10:59.800 What is this is game theory? Well, what if the 0:11:00.080 --> 0:11:02.000 this is a starting point as long as they pay 0:11:02.000 --> 0:11:04.560 in tonight to write for now and they're not going anywhere, 0:11:04.920 --> 0:11:07.040 this would be a bargaining chip to make sure that 0:11:07.080 --> 0:11:10.080 they get a better deal or a better Say. Yeah, 0:11:10.120 --> 0:11:13.840 I think that the UH the from the NATO side, 0:11:14.120 --> 0:11:16.880 that is just not going to be very well received. 0:11:16.960 --> 0:11:20.040 And it's worth knowing that. And I credit the Trump 0:11:20.080 --> 0:11:24.080 administration for this. Since they took over, spending rates on 0:11:24.120 --> 0:11:27.439 defense in Europe have been going up and up. Um, 0:11:27.480 --> 0:11:30.000 this is not the time to cash that chip in. 0:11:30.440 --> 0:11:33.520 Now is the time to really show solidarity and respond 0:11:33.559 --> 0:11:36.240 to that first play by the Europeans. All right, but 0:11:36.280 --> 0:11:39.040 the Secretary of State has been in the past a 0:11:39.080 --> 0:11:42.600 couple of weeks absent from several meetings with foreign leaders. 0:11:42.960 --> 0:11:45.559 Does this say that he's being cautious or this is 0:11:45.559 --> 0:11:47.560 a mistake, or does it mean that he doesn't have 0:11:47.640 --> 0:11:52.040 that much influence over foreign policy in Trump's administration. I 0:11:52.080 --> 0:11:54.240 think it's a bit of both friend scene and I'll 0:11:54.240 --> 0:11:57.359 add a third, which is he's not being well staffed 0:11:57.520 --> 0:12:00.320 he doesn't have a Deputy Secretary of State aid. He 0:12:00.400 --> 0:12:05.319 has no uh, no leadership below himself in that department. 0:12:05.440 --> 0:12:08.040 Right now, he's kind of home alone, and I think 0:12:08.520 --> 0:12:11.680 the department wouldn't let him make this kind of misstep. 0:12:12.520 --> 0:12:15.760 Help me here with the battle over the weekend of 0:12:15.920 --> 0:12:18.840 the press attending. You've had to put up with the 0:12:18.880 --> 0:12:23.360 press for years. I'm sure there's been some ugly moments. Um. 0:12:23.400 --> 0:12:25.440 I mean, there's a tradition to it. Is it a 0:12:25.480 --> 0:12:30.640 good tradition to have the press tag along? It absolutely is? 0:12:31.080 --> 0:12:35.360 And um, as a senior leader, I often took small 0:12:35.440 --> 0:12:38.559 press pools. Nothing like a sec deaf for a sex state. 0:12:39.440 --> 0:12:44.200 But yeah, it's inconvenient. It's occasionally annoying. Sometimes they get 0:12:44.200 --> 0:12:48.040 the story slightly wrong. But wouldn't you rather have them 0:12:48.080 --> 0:12:51.120 inside the tent than outside trying to figure it out, 0:12:51.200 --> 0:12:54.160 trying to speculate, trying to work with leakers. Um. So 0:12:54.320 --> 0:12:57.920 I think that again a mistake not to have the 0:12:57.960 --> 0:13:01.360 press come along on these trips. And I know Secretary Matters, 0:13:01.440 --> 0:13:03.960 for example, has been bringing the press on his trip. 0:13:04.080 --> 0:13:07.839 I hope that Secretary Tillerson uh does so as well. 0:13:07.960 --> 0:13:09.960 You mentioned team arrivals earlier, I mean, part of the 0:13:10.000 --> 0:13:13.079 problem here and getting warm bodies and foggy bottom is 0:13:13.120 --> 0:13:16.199 if you ever said anything negative about Mr Trump, you're 0:13:16.240 --> 0:13:20.280 off the list, right, That's absolutely true. And then secondly, 0:13:20.520 --> 0:13:23.319 let's face it thus far, the fact that you're watching 0:13:23.559 --> 0:13:26.680 the current Secretary of State Uh not be invited to 0:13:26.720 --> 0:13:30.480 the White House frequently, not seeming to consult on occasion, 0:13:30.840 --> 0:13:34.160 not coming to the big meetings. So I think there's 0:13:34.200 --> 0:13:37.720 a significant morale problem in foggy Bottom, and it's hard 0:13:37.720 --> 0:13:40.439 to recruit people to go into an organization that doesn't 0:13:40.440 --> 0:13:43.360 appear to be getting traction in Washington. That needs to 0:13:43.360 --> 0:13:47.240 be reversed because as a nation, we can't afford ineffective 0:13:47.240 --> 0:13:51.120 diplomacy anymore than we can afford ineffective defense. But there 0:13:51.200 --> 0:13:52.760 must be someone I don't know if you call it 0:13:52.800 --> 0:13:56.960 a dissenter or someone who criticizes the president behind closed 0:13:56.960 --> 0:13:59.079 door that he listens to. Is that his family? Is 0:13:59.120 --> 0:14:04.720 that his daughter Vane? Yeah, Well, let's hope that's the case. 0:14:04.920 --> 0:14:10.120 And I saw recently a correlation drawn between the tweeting 0:14:10.240 --> 0:14:15.160 cycle was much diminished during periods of time that Ivanka 0:14:15.240 --> 0:14:18.560 and Jared are around the president. Um, and let's hope 0:14:18.600 --> 0:14:22.040 that cabinet officials like Jim Madison, John Kelly and Rex 0:14:22.120 --> 0:14:26.000 Jillerson over time can have influence on him as well. Um. 0:14:26.080 --> 0:14:29.200 These are strong individuals who I think will be unafraid 0:14:29.280 --> 0:14:31.520 to speak truth to power. But they got to get 0:14:31.520 --> 0:14:35.280 in the room. And I think that's where uh Secretary 0:14:35.320 --> 0:14:38.400 Killerson has had his challenges thus far. Um, and don't 0:14:38.400 --> 0:14:40.400 well talk to me about the GOP. Is there a 0:14:40.480 --> 0:14:44.480 kind of um, you know, steak and carrots way of 0:14:44.600 --> 0:14:47.560 working where they say, look, President Trump, you need to 0:14:47.640 --> 0:14:50.160 follow us on diplomacy and actually not start trade with 0:14:50.400 --> 0:14:53.480 this country in this country, and in return, we'll give 0:14:53.520 --> 0:14:56.040 you more support for I don't know if it's tax 0:14:56.080 --> 0:14:58.760 cots or funding for some of the infrastructure projects. Does 0:14:58.800 --> 0:15:01.920 it work like that? Yes, it does. And you can 0:15:02.040 --> 0:15:05.920 see this tension in the GUP base in the international 0:15:05.960 --> 0:15:09.760 sphere right now. Um. Some in the GOP want to 0:15:10.480 --> 0:15:14.160 um effectively build those walls, not just the one with Mexico, 0:15:14.280 --> 0:15:17.960 but tariff barriers returned to the country, cut down or 0:15:18.040 --> 0:15:23.560 overseas military presence, whereas others, people like Paul Ryan, UH 0:15:23.800 --> 0:15:27.000 Max Thornbury, the Chairman of the House Arm Services Committee, 0:15:27.120 --> 0:15:31.080 are quite internationally oriented and have good views on defense. 0:15:31.360 --> 0:15:34.440 That tension will play out in the domestic back and 0:15:34.520 --> 0:15:38.400 forth over the issues you just mentioned. Francine, help us 0:15:38.600 --> 0:15:41.640 with the idea of the philosophy of our domestics debate 0:15:41.680 --> 0:15:44.440 on healthcare. We get to a vote Thursday onto a 0:15:44.520 --> 0:15:48.880 Senate where Steve Dennis says the health bill has minimal 0:15:49.440 --> 0:15:52.680 chance to get through and the basic ideas we need 0:15:52.720 --> 0:15:56.840 that money, that Butter money for our guns money. How 0:15:56.840 --> 0:16:01.680 do you filter that core question? I think that, Uh, 0:16:01.920 --> 0:16:04.360 it's not an on and off switch, Tom, we don't 0:16:04.760 --> 0:16:08.320 simply become a highly militarized nation at the expense of 0:16:08.400 --> 0:16:11.960 domestic policy. Um, it's a real stat and I think 0:16:12.000 --> 0:16:13.960 for the last eight years the real stat has been 0:16:14.680 --> 0:16:18.240 dialed strongly in the direction of Butter. It needs to 0:16:18.240 --> 0:16:20.160 come back a bit too. Guns. But I want to 0:16:20.160 --> 0:16:22.920 make a point about guns. It's not just guns. It's 0:16:23.080 --> 0:16:26.480 a state department, and it's budget, it's foreign aid, it 0:16:26.640 --> 0:16:30.760 is all of the international programs that helps create security. 0:16:31.080 --> 0:16:33.520 So you have to dial that real stat a bit. 0:16:33.920 --> 0:16:36.760 That's why there is a defense increase. But at the 0:16:36.800 --> 0:16:41.680 same time, as a nation, UM, we have big problems, 0:16:41.720 --> 0:16:44.800 and it's not just health it's our deficit um and 0:16:44.840 --> 0:16:48.200 I think that what's needed here back to books is 0:16:48.320 --> 0:16:51.200 the team of rivals approach, the ability to reach across 0:16:51.240 --> 0:16:54.760 the aisles if we if we dial those real stats individually, 0:16:54.840 --> 0:16:57.600 it's a lot less painful than whip sawing back and 0:16:57.640 --> 0:17:02.320 forth between administrations. James Trevita, thank you so much with 0:17:02.440 --> 0:17:05.080 TuS Fletcher School. I can't say enough, folks about the 0:17:05.160 --> 0:17:10.280 Leaders Bookshelf. Admiral James Devitis Uh never retired in our 0:17:10.359 --> 0:17:14.840 manning Angel as well, on a great way to find 0:17:14.960 --> 0:17:18.199 a lot of other books quickly and also get a 0:17:18.200 --> 0:17:23.000 core message, an important message from each of these Uh books, 0:17:23.000 --> 0:17:27.080 some of them very painful books about ordeal of military combat, 0:17:27.119 --> 0:17:30.920 the memoirs of Ulysses, s. Grant and here Um. This 0:17:31.080 --> 0:17:35.720 kind of work from the sixt T. R. Ferrenbach is 0:17:36.200 --> 0:17:40.359 mentioned in many others. James trevidis with a successful effort 0:17:40.800 --> 0:17:58.000 the Leaders Bookshelf. This is a wonderful treat This is 0:17:58.040 --> 0:18:02.000 why we do Bloomberg surveillance. His book is classic. It 0:18:02.119 --> 0:18:05.040 is The Banker to the World. His name is William Rhodes. 0:18:05.320 --> 0:18:08.119 If you don't know the name. He was Banker to 0:18:08.160 --> 0:18:11.720 the World for City Group and City Bank decades ago 0:18:11.840 --> 0:18:16.879 his public service to Brown University. UH speaks volumes. Bill Rhodes, 0:18:16.920 --> 0:18:19.359 You're the only one I wanted to talk to, maybe 0:18:19.440 --> 0:18:24.840 James Diamond about David Rockefeller passing away, dying in a 0:18:24.920 --> 0:18:28.520 hundred and one years old. What was David Rockefeller like 0:18:28.720 --> 0:18:33.000 as you were a young banker. It's City Group. First 0:18:33.040 --> 0:18:35.760 of all, David was a great man and I was 0:18:35.800 --> 0:18:38.520 privileged to first meet him when I came back from 0:18:38.600 --> 0:18:43.320 Latin America. Was City Bank, uh almost forty years ago. 0:18:43.400 --> 0:18:46.840 It was forty years ago in v seven, and we 0:18:46.960 --> 0:18:53.280 shared a mutual interest in Latin America. David, obviously everybody knows, 0:18:53.440 --> 0:18:56.119 was a world statesman, particularly in finance, one of the 0:18:56.160 --> 0:18:59.560 great bankers and financeeries of our age. But he had 0:18:59.560 --> 0:19:03.760 a he had a particular love for Latin America. And 0:19:03.800 --> 0:19:07.520 he founded the Council of the America's America Society in 0:19:07.600 --> 0:19:11.680 nineteen sixty five, and he got me in very involved 0:19:11.720 --> 0:19:15.720 with that. I became chairman later on for nine years, 0:19:15.760 --> 0:19:21.040 and David was the founder and chairman for a number 0:19:21.080 --> 0:19:25.119 of years, and he did he did tremendous work on 0:19:25.359 --> 0:19:28.879 improving relations between the United States and Latin America. He 0:19:29.000 --> 0:19:33.360 was patrician, and he was distant, and there was discretion 0:19:33.560 --> 0:19:38.160 and control at every moment, and behind that was prodigious 0:19:38.240 --> 0:19:42.160 economic abilities. He was a PhD in economics from Chicago. 0:19:42.640 --> 0:19:46.119 Is a kid. He actually did the academic work, didn't 0:19:46.119 --> 0:19:51.199 he exactly? But I think his lasting memory will be, 0:19:52.240 --> 0:19:55.919 UH what he believed in in the sense of the 0:19:55.960 --> 0:19:59.320 relationships between the United States and the rest of the world, 0:20:00.200 --> 0:20:05.800 and particularly with my personal experience, UH was what he 0:20:05.840 --> 0:20:08.399 did with Latin America. He is a revered figure in 0:20:08.480 --> 0:20:14.080 Latin America. UH and always UH connected the United States 0:20:14.400 --> 0:20:19.200 UH with Latin America and our culture, our trade UH. 0:20:19.240 --> 0:20:23.439 And UH did tremendous work philanthropically for all areas of 0:20:23.480 --> 0:20:27.159 the world, but particularly I would suggested the Latin America. 0:20:27.160 --> 0:20:29.720 And he founded a center in his name for Latin 0:20:29.800 --> 0:20:33.080 studies at Harvard. I mean he was also really a 0:20:33.119 --> 0:20:37.200 confident of world leaders from dangsher opinion China to Nelson 0:20:37.240 --> 0:20:43.400 Mandela in South Africa. What would he be advising President Trump? Well, 0:20:43.440 --> 0:20:46.400 I would I think what he would be advising President 0:20:46.440 --> 0:20:49.800 Trump at this point in time is to make sure 0:20:49.840 --> 0:20:52.080 that we don't get in a series of trade wars 0:20:53.520 --> 0:20:57.560 around the world. Because he always believed that free and 0:20:57.640 --> 0:21:00.800 fair markets were very very important for the growth of 0:21:00.840 --> 0:21:04.560 the world economy, and had been always a big supporter 0:21:04.600 --> 0:21:08.160 of the International Monetary Fund and the World Bank. Uh. 0:21:08.200 --> 0:21:12.320 And he dedicated his life to these relationships. You didn't 0:21:12.359 --> 0:21:15.679 apologize for being an American banker, and that was just 0:21:15.840 --> 0:21:19.760 Mr Rockefeller and his disciples over at the evil firm 0:21:20.240 --> 0:21:24.880 A Chase didn't apologize for being capitalists and bankers. We've 0:21:24.920 --> 0:21:28.040 got a lot of bankers now after this crisis, reticent 0:21:28.720 --> 0:21:33.800 about trumpeting capitalism, about traveling abroad, about showing the American 0:21:33.840 --> 0:21:37.400 banking flag. How do we get back to pride and banking. 0:21:38.760 --> 0:21:41.439 That is a key question, Tom, which you and I 0:21:41.480 --> 0:21:43.520 have discussed quite a lot. As you know, I've done 0:21:43.520 --> 0:21:47.920 a lot of work on on on banking culture. Uh. 0:21:47.960 --> 0:21:50.879 And I think it's it's key and David was a 0:21:50.880 --> 0:21:54.040 good example of that because he believed that he should 0:21:54.080 --> 0:21:58.520 use that platform to improve relationships around the world, to 0:21:58.520 --> 0:22:02.440 to make the world closer. Uh And Uh, I think 0:22:02.440 --> 0:22:06.439 he achieved that. And I think that, uh, this is 0:22:06.480 --> 0:22:09.159 what the banking community ought to be doing, trying to 0:22:09.200 --> 0:22:12.600 help it's it's it's communities to bring back the trust 0:22:12.680 --> 0:22:16.200 and banking, which David was a good example of because 0:22:16.240 --> 0:22:19.800 somewhere along the way, I think in the United States, 0:22:19.800 --> 0:22:21.880 Europe and other parts of the world, trust has been 0:22:21.880 --> 0:22:25.280 lost in in banking and we must get back to 0:22:25.320 --> 0:22:29.240 those basic thoughts of you know, a bankers there to 0:22:29.320 --> 0:22:33.280 help the community. Uh. And that was number one, and 0:22:33.280 --> 0:22:36.240 that certainly was the way David looked at things. Bill 0:22:36.320 --> 0:22:38.440 Roods thrilled to have you with us today, Mr Rhose, 0:22:38.480 --> 0:22:40.199 of course, the author of Banker to the World in 0:22:40.280 --> 0:22:45.320 the City Bank for years, UH, William Rhodes in honor 0:22:45.359 --> 0:22:57.000 of David Rockefeller, brought you by Bank of America. Mary Lynch. 0:22:57.119 --> 0:23:01.480 Dedicated to bringing our clients insights solutions to meet the 0:23:01.560 --> 0:23:05.959 challenges of a transforming world. That's the power of global connections. 0:23:06.359 --> 0:23:10.879 Mary Lynch, Pierce, Feeder and Smith Incorporated Member s I 0:23:11.000 --> 0:23:17.600 p C. This is a wonderful moment to speak to 0:23:17.720 --> 0:23:21.160 Paul Quincy. We're talking with Bill Rhodes earlier about David 0:23:21.240 --> 0:23:25.560 Rockefeller and discretion and being proper. That's what you do 0:23:25.600 --> 0:23:28.760 at JP Morgan Asset Management, where you're in the greatest 0:23:28.800 --> 0:23:34.360 bull market since time began. And with within that, Paul Quincy, 0:23:34.440 --> 0:23:37.240 if I look at the equity market. The basic emotion 0:23:37.400 --> 0:23:40.920 is so many people have missed this bull market. How 0:23:40.920 --> 0:23:44.560 do we catch up? Well, one way to catch up 0:23:44.720 --> 0:23:48.080 is to look outside the US and look at markets 0:23:48.119 --> 0:23:50.320 that have not yet been in the greatest bull market 0:23:50.320 --> 0:23:54.000 of all time, where valuations are still more depressed, and 0:23:54.119 --> 0:23:58.360 where I think, really importantly, we're seeing actually finally profitability 0:23:58.440 --> 0:24:00.359 really beginning to improve. So if you just look at 0:24:00.359 --> 0:24:02.840 the returns over the last five years, then you've compounded 0:24:03.080 --> 0:24:05.520 a mid teens rate of gaining the SMP. That's a 0:24:05.560 --> 0:24:09.280 tremendous result of historical standards. The compound return in U 0:24:09.359 --> 0:24:12.120 S dollars on emerging markets over the same period one 0:24:13.240 --> 0:24:16.080 the compound return on European equities again if you measured 0:24:16.080 --> 0:24:19.359 in U S dollars around five So those are not 0:24:19.520 --> 0:24:22.160 yet anything like the type of numbers that people feel 0:24:22.200 --> 0:24:24.480 like they've missed very much on. And yet when we 0:24:24.480 --> 0:24:28.080 look at those regions, we see valuations as you'd expect, 0:24:28.240 --> 0:24:32.400 looking pretty reasonable, but also profitability really starting to improve 0:24:32.440 --> 0:24:34.399 in a much more convincing way than we've seen for 0:24:34.440 --> 0:24:37.000 some time. Paul, what is the one thing that you 0:24:37.040 --> 0:24:39.400 can go wrong in Europe? Though? Is it the right time. 0:24:39.480 --> 0:24:41.800 If you like European equity, should we not wait until 0:24:42.040 --> 0:24:45.240