1 00:00:02,240 --> 00:00:05,640 Speaker 1: Global business news twenty four hours a day. If Bloomberg 2 00:00:05,680 --> 00:00:08,760 Speaker 1: dot Com, the Radio plus Mobile Act and on your radio. 3 00:00:09,039 --> 00:00:13,360 Speaker 1: This is a Bloomberg Business Flash from Bloomberg World Headquarters. 4 00:00:13,480 --> 00:00:16,720 Speaker 1: I'm Charlie tell it is a down Friday for US 5 00:00:16,840 --> 00:00:20,119 Speaker 1: equities Jobs Friday. This update brought to you by Van 6 00:00:20,360 --> 00:00:23,560 Speaker 1: Eck Vectors e t f s. Expect more from your 7 00:00:23,640 --> 00:00:28,080 Speaker 1: muti's target tax exempt income by maturity and credit quality, 8 00:00:28,440 --> 00:00:32,120 Speaker 1: all with low cost ETFs. Visit van Eck dot com 9 00:00:32,200 --> 00:00:38,040 Speaker 1: slash muti van Eck access the opportunities. Stocks paired losses 10 00:00:38,080 --> 00:00:41,560 Speaker 1: as the dollar fell, treasuries and gold are gaining after 11 00:00:41,680 --> 00:00:44,760 Speaker 1: US employers added the fewest jobs in almost six years 12 00:00:44,880 --> 00:00:47,360 Speaker 1: in made bolstering the case for the Fed to leave 13 00:00:47,479 --> 00:00:51,560 Speaker 1: rates lower for longer. The SMP five index down four 14 00:00:51,640 --> 00:00:54,840 Speaker 1: to one, a drop of two tenths of one percent, 15 00:00:55,360 --> 00:00:59,200 Speaker 1: as stacked down twenty three points to seven, a drop 16 00:00:59,240 --> 00:01:02,920 Speaker 1: off point five percent down. Industrials down twenty a drop 17 00:01:03,000 --> 00:01:06,280 Speaker 1: of point one percent. Gold surging two and a half 18 00:01:06,319 --> 00:01:09,520 Speaker 1: percent to thirty ninety. The ounce thirty up thirty ninety, 19 00:01:09,520 --> 00:01:15,480 Speaker 1: the ounce to twelve fifty crewed down one barrel on 20 00:01:15,600 --> 00:01:18,560 Speaker 1: West Texas Intermedia crwede a drop of eight tenths of 21 00:01:18,680 --> 00:01:23,280 Speaker 1: one percent. I'm Charlie Pellett. That's a Bloomberg business flash. 22 00:01:23,600 --> 00:01:27,040 Speaker 1: You're listening to taking stock with Cale and pim Box 23 00:01:27,160 --> 00:01:32,480 Speaker 1: on Bloomberg Radio. Republican candidate Donald Trump he emphasizes his 24 00:01:32,640 --> 00:01:36,959 Speaker 1: business savvy as one reason to make him president. But 25 00:01:37,240 --> 00:01:41,400 Speaker 1: is he business savvy about the US treasury market? Let's 26 00:01:41,440 --> 00:01:44,399 Speaker 1: find out more from Jonathan Nicholson. He is Capitol Hill 27 00:01:44,440 --> 00:01:48,920 Speaker 1: budget reporter for Bloomberg b NA, joining us from Arlington, Virginia, 28 00:01:49,080 --> 00:01:53,360 Speaker 1: the metro area Washington, d C, home to Bloomberg twelve 29 00:01:53,880 --> 00:01:56,760 Speaker 1: and nine. I beg your pardon one and one oh 30 00:01:56,840 --> 00:01:59,760 Speaker 1: five point seven h d F M h D two. 31 00:02:00,720 --> 00:02:03,640 Speaker 1: Jonathan tell us what exactly is this Trump talk? And 32 00:02:03,840 --> 00:02:09,840 Speaker 1: is Wall Street taking him seriously? Well? The excuse me? Um, 33 00:02:09,880 --> 00:02:15,200 Speaker 1: he talked about bondholders taking haircuts, discounts on bombs. He's 34 00:02:15,240 --> 00:02:19,239 Speaker 1: talked about, you know, talked about a trade getting into 35 00:02:19,240 --> 00:02:23,760 Speaker 1: retarritory trade uh A wars specifically about who cares if 36 00:02:23,760 --> 00:02:25,560 Speaker 1: there's a who the hell cares if there's a trade 37 00:02:25,560 --> 00:02:28,280 Speaker 1: war with China. Um. These are ordinary things that would 38 00:02:28,280 --> 00:02:30,919 Speaker 1: make markets sort of spoopd uh for coming from a 39 00:02:30,960 --> 00:02:34,720 Speaker 1: major part of the nominee. But so far, UM, really 40 00:02:34,760 --> 00:02:38,080 Speaker 1: markets have shown very little reaction to this. So the 41 00:02:38,120 --> 00:02:41,480 Speaker 1: debate is sort of come to why haven't they shown 42 00:02:41,480 --> 00:02:46,000 Speaker 1: that reaction yet? Well? Could it be simply that they 43 00:02:46,080 --> 00:02:50,480 Speaker 1: know that trade wars are not conducted solely by presidents. 44 00:02:50,760 --> 00:02:53,799 Speaker 1: Congress has to be involved to uh, And so they 45 00:02:53,880 --> 00:02:56,200 Speaker 1: realize that a president can push for certain things, but 46 00:02:56,240 --> 00:02:59,040 Speaker 1: they don't necessarily get them. That's right there. There's sort 47 00:02:59,080 --> 00:03:03,680 Speaker 1: of three theories. UH. One is is that some people 48 00:03:03,760 --> 00:03:07,240 Speaker 1: say that they just simply don't believe that he doesn't 49 00:03:07,240 --> 00:03:09,359 Speaker 1: believe what he's saying. That he's just started saying these 50 00:03:09,360 --> 00:03:12,960 Speaker 1: things to get past the geop primary UH, to get 51 00:03:13,000 --> 00:03:14,239 Speaker 1: to the right of the rest of what used to 52 00:03:14,240 --> 00:03:16,000 Speaker 1: be the rest of the field. UM, and then he 53 00:03:16,040 --> 00:03:18,960 Speaker 1: comes back to the general he'll say something much more, 54 00:03:19,080 --> 00:03:21,800 Speaker 1: much more in line with mainstream thinking. The other aspect 55 00:03:21,880 --> 00:03:25,000 Speaker 1: is yes, uh. Some people, such as the Congressman Dave Ratt, 56 00:03:25,680 --> 00:03:27,399 Speaker 1: point out that some of these things are some things 57 00:03:27,440 --> 00:03:29,040 Speaker 1: he cannot do on his own that he would have 58 00:03:29,080 --> 00:03:32,240 Speaker 1: to have Congressional approval for, and therefore Congress would act 59 00:03:32,240 --> 00:03:34,400 Speaker 1: to sort of a moderating influence even if he did 60 00:03:34,480 --> 00:03:37,480 Speaker 1: believe some of these things. Uh. There's a third school 61 00:03:37,480 --> 00:03:39,960 Speaker 1: of thought, um, which I think we may be borne 62 00:03:39,960 --> 00:03:41,960 Speaker 1: out a little bit by Poles at this point, which 63 00:03:42,000 --> 00:03:45,240 Speaker 1: is that simply people Wall Street at this point, you know, 64 00:03:45,320 --> 00:03:48,280 Speaker 1: things still early, and that the odds of Trump being 65 00:03:48,280 --> 00:03:51,760 Speaker 1: elected are still very much on the negative side. So 66 00:03:51,800 --> 00:03:55,240 Speaker 1: it's not really a risk to be incorporating into into 67 00:03:55,280 --> 00:03:58,360 Speaker 1: their into their trading decisions at this point. Well, let's 68 00:03:58,360 --> 00:04:01,880 Speaker 1: bring another voice. He's not exactly Jonathan, but he is 69 00:04:01,920 --> 00:04:06,080 Speaker 1: a John. Uh into this conversation now, John Hylemans in studio. 70 00:04:06,560 --> 00:04:09,680 Speaker 1: He is host of with all due respect on Bloomberg 71 00:04:09,760 --> 00:04:12,800 Speaker 1: Television and radio every day at five o'clock Wall Street Time. 72 00:04:13,320 --> 00:04:16,320 Speaker 1: So what do you make of this question? John Hyleman, 73 00:04:16,360 --> 00:04:19,119 Speaker 1: You've been following campaigns like this for a long time. 74 00:04:19,120 --> 00:04:23,880 Speaker 1: Wall Street seems to be taken and stride. Why I'm sorry, 75 00:04:23,880 --> 00:04:27,240 Speaker 1: what the precise question is? With the precise question, my 76 00:04:27,279 --> 00:04:31,040 Speaker 1: friend is um, Donald Trump talks about trade wars, he 77 00:04:31,080 --> 00:04:34,720 Speaker 1: talks about bonds in China, and you if people were 78 00:04:34,720 --> 00:04:37,920 Speaker 1: taking seriously this is the question that Jonathan Nicholson has 79 00:04:37,960 --> 00:04:41,040 Speaker 1: been raising Bloomberg b n A. So what gives Why 80 00:04:41,040 --> 00:04:43,000 Speaker 1: do you think that's so? What would what do your 81 00:04:43,000 --> 00:04:46,080 Speaker 1: sources tell you? Well, I think there's um. You know 82 00:04:46,160 --> 00:04:48,640 Speaker 1: that The thing with Trump, right is that I think, uh, 83 00:04:49,040 --> 00:04:51,520 Speaker 1: there's no doubt that if we get closer and closer 84 00:04:51,520 --> 00:04:54,680 Speaker 1: to election day and people increasingly believe that Donald Trump 85 00:04:54,680 --> 00:04:57,240 Speaker 1: will be president number one and number two, the Donald 86 00:04:57,279 --> 00:05:01,280 Speaker 1: Trump actually means many of the things he says on 87 00:05:01,400 --> 00:05:05,080 Speaker 1: economic policy that there will be um consequences in the 88 00:05:05,120 --> 00:05:09,200 Speaker 1: financial markets. I think those two are two big contingencies 89 00:05:09,240 --> 00:05:11,679 Speaker 1: at the moment still, right, One of which is people 90 00:05:11,800 --> 00:05:13,800 Speaker 1: don't necessarily think that Trump is going to be the president. 91 00:05:13,800 --> 00:05:17,080 Speaker 1: But more importantly, he everything he's been saying of late 92 00:05:17,440 --> 00:05:22,520 Speaker 1: suggests that virtually everything he says on policy is I'm 93 00:05:22,520 --> 00:05:24,920 Speaker 1: gonna use their variety of potential words here, right. One 94 00:05:24,920 --> 00:05:29,640 Speaker 1: potential word would be um just a posture, Another would 95 00:05:29,680 --> 00:05:35,160 Speaker 1: be a negotiating position. A third would be a fraud. Right. 96 00:05:35,200 --> 00:05:37,760 Speaker 1: I mean, depending on what your your predisposition is. Some 97 00:05:37,839 --> 00:05:40,680 Speaker 1: people think that Trump. There's there's one school of thought, 98 00:05:40,680 --> 00:05:44,000 Speaker 1: which is Trump is a hundred percent transactional. He said 99 00:05:44,040 --> 00:05:46,400 Speaker 1: a bunch of things in the course of the Republican 100 00:05:46,400 --> 00:05:49,440 Speaker 1: nomination fight in order to get nominated, but he doesn't 101 00:05:49,440 --> 00:05:51,440 Speaker 1: really believe any of those things. He's just saying what 102 00:05:51,480 --> 00:05:53,960 Speaker 1: it takes to get elected. Other people think he basically 103 00:05:54,000 --> 00:05:57,599 Speaker 1: believes most of what he says, but he's willing to negotiate. 104 00:05:57,600 --> 00:05:59,920 Speaker 1: He's taken extreme positions that he understands he's going to 105 00:06:00,040 --> 00:06:02,440 Speaker 1: have to back off from. UM. And other people believe 106 00:06:02,480 --> 00:06:04,760 Speaker 1: he believes absolutely everything he says, he's a hundred percent 107 00:06:04,839 --> 00:06:08,280 Speaker 1: sincere and that that would be scary if that were 108 00:06:08,320 --> 00:06:11,080 Speaker 1: true on these questions of economic policy and trade, so 109 00:06:11,320 --> 00:06:14,000 Speaker 1: for as as a good example. No one knows though 110 00:06:14,000 --> 00:06:16,400 Speaker 1: at this point right and Trump seems to be trying 111 00:06:16,440 --> 00:06:20,880 Speaker 1: to seed people's notion see the notion with people that 112 00:06:20,880 --> 00:06:23,360 Speaker 1: that that many of the things he says are at 113 00:06:23,480 --> 00:06:28,480 Speaker 1: minimum highly negotiable UM, and potentially entirely negotiable. Uh. And 114 00:06:28,600 --> 00:06:30,080 Speaker 1: there are other people, I think who have this the 115 00:06:30,279 --> 00:06:32,400 Speaker 1: final thing that the people believe. And again Mitch McConnell 116 00:06:32,480 --> 00:06:34,680 Speaker 1: is someone and others who says things like this where 117 00:06:34,680 --> 00:06:36,880 Speaker 1: they say, look, um, it sort of matters with Donald 118 00:06:36,880 --> 00:06:39,800 Speaker 1: Trump thinks. But in the end, UM, accepting matters of 119 00:06:39,880 --> 00:06:43,680 Speaker 1: national security, the president is doesn't have pure executive authority 120 00:06:43,680 --> 00:06:45,640 Speaker 1: to do much of anything. If he wanted to pass 121 00:06:45,640 --> 00:06:47,160 Speaker 1: a law, I'd have to go through Congress. They're all 122 00:06:47,200 --> 00:06:49,400 Speaker 1: kinds of institutional restraints that would keep him from doing 123 00:06:49,440 --> 00:06:51,279 Speaker 1: some of the more extreme things that he suggested. And 124 00:06:51,320 --> 00:06:54,320 Speaker 1: so everyone just calmed down. The American system is designed 125 00:06:54,480 --> 00:06:57,160 Speaker 1: to keep anyone from doing anything too radical if they 126 00:06:57,160 --> 00:07:00,440 Speaker 1: get into the Oval office. John Hyman Europe well too. 127 00:07:00,960 --> 00:07:04,160 Speaker 1: Based on your experience and based on covering this campaign, 128 00:07:04,520 --> 00:07:07,040 Speaker 1: where do you fall in those three different areas of 129 00:07:07,360 --> 00:07:11,960 Speaker 1: Donald Trump investigation analysis? Don't know. I don't know the answer, 130 00:07:12,000 --> 00:07:13,720 Speaker 1: I really don't. I mean, if you looked at the 131 00:07:13,840 --> 00:07:18,800 Speaker 1: history Trump's history, UM, there are some issues where um. 132 00:07:18,880 --> 00:07:22,040 Speaker 1: For instance, on social issues, Trump's position on abortion, for instance, 133 00:07:22,040 --> 00:07:24,440 Speaker 1: where um, not that long ago he was not only 134 00:07:24,520 --> 00:07:27,160 Speaker 1: pro choice, but in favor of things like partial birth abortion, 135 00:07:27,200 --> 00:07:29,679 Speaker 1: which he thought were fine. Now he says he's pro life. 136 00:07:30,120 --> 00:07:33,680 Speaker 1: That seems to me to be the one that's most 137 00:07:33,800 --> 00:07:37,240 Speaker 1: likely to be transparently um, a position that he's taken 138 00:07:37,280 --> 00:07:40,800 Speaker 1: for purely political reasons on questions of foreign of his 139 00:07:40,920 --> 00:07:44,560 Speaker 1: view of of of how the world economy works. He 140 00:07:44,600 --> 00:07:47,960 Speaker 1: has been somewhat more cantilest for a long time, and 141 00:07:48,040 --> 00:07:51,600 Speaker 1: his attacks on China, has attacks on Japan, his view 142 00:07:51,640 --> 00:07:54,920 Speaker 1: of how foreign trade works, of how free trade hurts 143 00:07:54,920 --> 00:07:59,280 Speaker 1: American workers, etcetera. Those seem to be more consistently applied 144 00:07:59,320 --> 00:08:01,080 Speaker 1: across a long a period of time in his life, 145 00:08:01,080 --> 00:08:03,040 Speaker 1: and so they seem to me to be maybe closer 146 00:08:03,080 --> 00:08:05,440 Speaker 1: to where his actual heart and head are. But again, 147 00:08:05,520 --> 00:08:07,520 Speaker 1: because he is a very transactional person, he is a 148 00:08:07,560 --> 00:08:10,200 Speaker 1: dealmaker at heart. Right, it does even mean that even 149 00:08:10,240 --> 00:08:13,160 Speaker 1: in those instances, those positions that he's put forward, like 150 00:08:13,440 --> 00:08:15,840 Speaker 1: specific tariffs he wants to put on China, for instance, 151 00:08:16,000 --> 00:08:18,920 Speaker 1: those may be really in the category of negotiating positions 152 00:08:19,000 --> 00:08:20,920 Speaker 1: rather than things he will push for in their most 153 00:08:20,960 --> 00:08:25,240 Speaker 1: absolute form. Uh. The primaries are coming up next week. 154 00:08:25,280 --> 00:08:28,600 Speaker 1: They're big ones, certainly in the size of the states 155 00:08:28,640 --> 00:08:31,960 Speaker 1: and the potential number of delicates, even though the presumptive 156 00:08:32,040 --> 00:08:35,600 Speaker 1: nominees for both parties look, you know, like they're pretty 157 00:08:35,679 --> 00:08:38,600 Speaker 1: much almost solid in that position, John Right, So you know, 158 00:08:38,640 --> 00:08:40,520 Speaker 1: we have these a bunch of primaries coming up on Tuesday. 159 00:08:40,559 --> 00:08:42,560 Speaker 1: The two big ones are California New Jersey, which have 160 00:08:42,559 --> 00:08:45,480 Speaker 1: the biggest delegate halls. Obviously that there, Donald Trump is 161 00:08:45,520 --> 00:08:49,000 Speaker 1: already um in in terms of the math has already 162 00:08:49,000 --> 00:08:52,040 Speaker 1: gone over the magic number on the Republican side, and 163 00:08:52,040 --> 00:08:54,400 Speaker 1: so he is officially kind of the presumptive nominee. That's 164 00:08:54,400 --> 00:08:57,120 Speaker 1: not the case yet for Hillary Clinton. But no matter 165 00:08:57,240 --> 00:09:01,079 Speaker 1: what happens on Tuesday, um she will um have. Because 166 00:09:01,080 --> 00:09:03,560 Speaker 1: of the way Democrats allocate their delegates, she will um 167 00:09:03,880 --> 00:09:09,120 Speaker 1: uh again with certainty she will have between her pledge 168 00:09:09,120 --> 00:09:11,480 Speaker 1: delegates and her commitments from super delegates, she will go 169 00:09:11,559 --> 00:09:14,120 Speaker 1: over the Democratic magic number on Tuesday night. The big 170 00:09:14,160 --> 00:09:17,640 Speaker 1: issue in the Democratic Party is not about the delegate halls. 171 00:09:17,679 --> 00:09:22,360 Speaker 1: It's about um bragging rights and the effect psychologically of 172 00:09:22,400 --> 00:09:25,600 Speaker 1: what happens in California, particularly on Bernie Sanders, is he 173 00:09:25,679 --> 00:09:29,680 Speaker 1: if he wins California, that may embolden him to continue 174 00:09:29,920 --> 00:09:32,640 Speaker 1: fighting on even after the Primers event, and fighting on 175 00:09:32,679 --> 00:09:35,199 Speaker 1: all the way to Philadelphia. The reason the Clinton campaign 176 00:09:35,200 --> 00:09:37,920 Speaker 1: really wants to win California is now spending money there 177 00:09:37,920 --> 00:09:40,600 Speaker 1: on the air, sending Bill Clinton there, sending Hillary Clinton there. 178 00:09:40,600 --> 00:09:43,360 Speaker 1: They want to win so that they can strengthen their 179 00:09:43,400 --> 00:09:46,520 Speaker 1: claim that it's time for Bernie Sanders to stop and 180 00:09:46,600 --> 00:09:49,120 Speaker 1: to try to put his efforts into unifying the party 181 00:09:49,200 --> 00:09:53,280 Speaker 1: rather than continuing to fight I'm Jonathan Nicholson, our Capital 182 00:09:53,360 --> 00:09:55,920 Speaker 1: Hill budget reporter for Bloomberg BNA. Still with us, and 183 00:09:56,000 --> 00:09:57,959 Speaker 1: Jonathan want to put to you the issue of trade 184 00:09:57,960 --> 00:10:02,080 Speaker 1: wars that John Hayman raised. Trump says that he would 185 00:10:02,160 --> 00:10:08,280 Speaker 1: rewrite international trade agreements. Has that reverberated in financial markets? UM, 186 00:10:08,320 --> 00:10:10,920 Speaker 1: not so far. Uh. The interesting thing is if you 187 00:10:10,960 --> 00:10:12,280 Speaker 1: kind of if you go and take a look at 188 00:10:12,320 --> 00:10:14,680 Speaker 1: sort of like his written policy in terms of what 189 00:10:14,679 --> 00:10:17,040 Speaker 1: he was put on his website, UM, in terms of 190 00:10:17,600 --> 00:10:21,920 Speaker 1: what they're counting as policy paper type type material, UM, 191 00:10:22,160 --> 00:10:26,520 Speaker 1: he actually talks more about designating China's a currency manipulator, UM, 192 00:10:26,760 --> 00:10:29,800 Speaker 1: rather than more about tariffs. He'll talk about the tariffs 193 00:10:29,880 --> 00:10:32,760 Speaker 1: UH and so on on the campaign trail and and 194 00:10:32,760 --> 00:10:35,640 Speaker 1: and be very loud about it. But actually when you 195 00:10:35,679 --> 00:10:37,800 Speaker 1: look at what he's got to put on paper, he's 196 00:10:37,880 --> 00:10:40,959 Speaker 1: much more talked about, uh, doing this designation as a 197 00:10:41,000 --> 00:10:44,000 Speaker 1: currency manipulator, which is certainly sort of an ongoing debate 198 00:10:44,080 --> 00:10:47,200 Speaker 1: here in Washington for some time. And he's only talked 199 00:10:47,200 --> 00:10:50,600 Speaker 1: about retaliatory tariffs UM in light of if China didn't 200 00:10:50,600 --> 00:10:52,720 Speaker 1: open up their markets. That does play a little bit 201 00:10:52,720 --> 00:10:58,440 Speaker 1: into into UH. John's point about transactionality that they might 202 00:10:58,480 --> 00:11:01,319 Speaker 1: say that his arc maybe worse than his bike in 203 00:11:01,400 --> 00:11:04,480 Speaker 1: some respect. Thank you very much, Jonathan Nicholson, Capitol Hill 204 00:11:04,480 --> 00:11:06,679 Speaker 1: budget reporter for Bloomberg and b n A, or thanks 205 00:11:06,679 --> 00:11:10,079 Speaker 1: to John Heilman, co host, with all due respect, weeknights 206 00:11:10,080 --> 00:11:12,760 Speaker 1: five pm Bloomberg Television and Bloomberg nine and nine one 207 00:11:12,760 --> 00:11:13,679 Speaker 1: in Washington, d C.