1 00:00:00,080 --> 00:00:12,960 Speaker 1: Ye, Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keene 2 00:00:13,480 --> 00:00:17,560 Speaker 1: Jay Leye. We bring you insight from the best in economics, finance, investment, 3 00:00:18,000 --> 00:00:23,520 Speaker 1: and international relations. Find Bloomberg Surveillance on Apple Podcasts, SoundCloud, 4 00:00:23,600 --> 00:00:32,320 Speaker 1: Bloomberg dot Com, and of course, on the Bloomberg. Barry E. 5 00:00:32,400 --> 00:00:36,120 Speaker 1: Con Green, the University of California, professor at Berkeley and 6 00:00:36,360 --> 00:00:39,879 Speaker 1: author of The Populist Temptation. It's actually sitting on my 7 00:00:39,920 --> 00:00:42,720 Speaker 1: bedside table back in New York. It's an absolute muss 8 00:00:42,760 --> 00:00:45,400 Speaker 1: read to understand the seeds of the political movements that 9 00:00:45,400 --> 00:00:48,840 Speaker 1: are sweeping through the United States and Europe currently. Good 10 00:00:48,880 --> 00:00:51,080 Speaker 1: morning to Professor is great Ambi with us on the program. 11 00:00:51,120 --> 00:00:54,880 Speaker 1: Good Morning. Populism in Europe, as you point out, has 12 00:00:54,920 --> 00:00:57,600 Speaker 1: a very very long history. We've been confronted with it 13 00:00:57,960 --> 00:01:00,360 Speaker 1: a whole lot more recently. How do you exp Blaine, 14 00:01:00,440 --> 00:01:04,280 Speaker 1: what we're seeing in Italy right now? Immigration is really 15 00:01:04,319 --> 00:01:08,839 Speaker 1: the the key unifying fact here. I think people in 16 00:01:10,120 --> 00:01:13,320 Speaker 1: Europe and Italy are worried about economic insecurity and they 17 00:01:13,360 --> 00:01:17,120 Speaker 1: associate that with uh an influx of foreign workers, and 18 00:01:17,160 --> 00:01:22,440 Speaker 1: they have identity concerns. Immigration raises those as well, so 19 00:01:22,480 --> 00:01:27,200 Speaker 1: it's not surprising that that has been UH the flashpoint 20 00:01:27,520 --> 00:01:32,160 Speaker 1: in Italian and European politics, and movements like Five Star 21 00:01:32,360 --> 00:01:36,360 Speaker 1: and the Northern League have both sought to capitalize on it. 22 00:01:37,120 --> 00:01:39,440 Speaker 1: Something they can both agree on is to spend more. 23 00:01:39,520 --> 00:01:42,920 Speaker 1: To borrow your phrase, the populous temptation, um, professor, it 24 00:01:42,959 --> 00:01:46,120 Speaker 1: seems the temptation is to borrow more. Can financial markets 25 00:01:46,120 --> 00:01:50,120 Speaker 1: constrained the ambition of populism in a place like Italy, Well, 26 00:01:50,160 --> 00:01:53,640 Speaker 1: they did constrain the ambitions in a place like Greece. 27 00:01:54,400 --> 00:02:00,000 Speaker 1: Uh In so I do see a scenario where UH 28 00:02:00,080 --> 00:02:03,760 Speaker 1: one member of the coalition, the Five Star movement, continues 29 00:02:03,800 --> 00:02:07,960 Speaker 1: to press for larger budget deficits, but it's partner, the League, 30 00:02:08,480 --> 00:02:12,080 Speaker 1: is more UH fiscally conservative. There will be a battle 31 00:02:12,160 --> 00:02:16,040 Speaker 1: within this government as well about how large those budget 32 00:02:16,040 --> 00:02:19,200 Speaker 1: deficits need to be and whether the markets should be 33 00:02:19,240 --> 00:02:24,399 Speaker 1: heard or not. Good morning here everyone from New York. 34 00:02:24,440 --> 00:02:27,280 Speaker 1: John Faro in London and Tom keenan New York, and 35 00:02:27,320 --> 00:02:30,080 Speaker 1: of course with this, professor, I agree. I'm gonna speak 36 00:02:30,080 --> 00:02:33,080 Speaker 1: to Madame Legarde on Monday in Washington. What should I 37 00:02:33,080 --> 00:02:36,080 Speaker 1: ask her about the strength of her institution? She's once 38 00:02:36,120 --> 00:02:39,960 Speaker 1: again come to the rescue and saved Argentina. But what's 39 00:02:40,080 --> 00:02:44,880 Speaker 1: your major message to Christine Legard. The IMF has a 40 00:02:45,000 --> 00:02:49,480 Speaker 1: funding problem going forward, with some of its resources expiring 41 00:02:49,560 --> 00:02:55,040 Speaker 1: in others expiring in one. So they will need a 42 00:02:55,080 --> 00:03:01,080 Speaker 1: commitment from UH their member governments, including the United States, 43 00:03:01,360 --> 00:03:03,600 Speaker 1: to renew those resources if they're going to have the 44 00:03:03,639 --> 00:03:08,200 Speaker 1: firepower UM to deal with not only Argentina, but whatever 45 00:03:08,240 --> 00:03:11,359 Speaker 1: else comes down from your reading of history. Can President 46 00:03:11,360 --> 00:03:16,079 Speaker 1: Trump block that funding or diminish that funding and diminish 47 00:03:16,160 --> 00:03:19,120 Speaker 1: the impact of the I m F He can UH, 48 00:03:19,240 --> 00:03:21,520 Speaker 1: in in part because the Congress would have to go 49 00:03:21,560 --> 00:03:25,200 Speaker 1: along with whatever proposal UH the U S Treasury tables 50 00:03:25,320 --> 00:03:30,760 Speaker 1: for additional funding for the IMF. UM. The fund would 51 00:03:30,800 --> 00:03:33,919 Speaker 1: then go to other sources that would would ask China 52 00:03:34,120 --> 00:03:39,160 Speaker 1: for bilateral UH credit line to top up its resources. 53 00:03:39,160 --> 00:03:43,360 Speaker 1: But the Chinese, I think, would be reluctant to provide 54 00:03:43,360 --> 00:03:47,160 Speaker 1: if they don't get additional votes in the institution. So 55 00:03:47,200 --> 00:03:52,400 Speaker 1: I think there is a real danger of an underresourced IMF. 56 00:03:53,200 --> 00:03:55,840 Speaker 1: But the heart of this barrier within all your work 57 00:03:56,120 --> 00:03:59,800 Speaker 1: and frankly the international community, is the word vacuum, and 58 00:04:00,000 --> 00:04:03,760 Speaker 1: almost on a physics basis, if America, which has done 59 00:04:03,840 --> 00:04:08,560 Speaker 1: numerous times before, steps back from the international scene, a 60 00:04:08,680 --> 00:04:11,960 Speaker 1: vacuum is created. What's the rated change of our new 61 00:04:12,000 --> 00:04:16,400 Speaker 1: Trumpian vacuum right now? Are we stepping away with greater 62 00:04:16,520 --> 00:04:19,599 Speaker 1: extent after these UN meetings this week? I don't. I 63 00:04:19,600 --> 00:04:23,320 Speaker 1: don't think we've UM ever seen a U S treat 64 00:04:23,400 --> 00:04:27,760 Speaker 1: from retreat from the international stage of this magnitude in 65 00:04:27,760 --> 00:04:31,880 Speaker 1: in my lifetime. UH. And the question is UM who 66 00:04:31,920 --> 00:04:35,839 Speaker 1: steps up? The Europeans are are showing signs of doing 67 00:04:35,880 --> 00:04:40,080 Speaker 1: that by UH talking to both the Russians and the 68 00:04:40,200 --> 00:04:45,200 Speaker 1: Chinese about how to do business with Iran despite UH 69 00:04:45,240 --> 00:04:49,120 Speaker 1: the U S reimposition of sanctions. So maybe there is 70 00:04:49,200 --> 00:04:53,400 Speaker 1: scope for China and Europe to begin to fill that vacuum, 71 00:04:53,520 --> 00:04:57,799 Speaker 1: link it into financial stability and instability. And of course 72 00:04:57,800 --> 00:05:00,280 Speaker 1: this is the green book, claimed green book the I 73 00:05:00,400 --> 00:05:02,719 Speaker 1: m F. I think of just as one named Carlo 74 00:05:02,800 --> 00:05:08,560 Speaker 1: Cardarelli and his contribution there, just as one example, Deutsche 75 00:05:08,560 --> 00:05:14,440 Speaker 1: Bank hugely struggling as a national iconic institution. How do 76 00:05:14,520 --> 00:05:19,720 Speaker 1: you work out our financial system to a greater stability? 77 00:05:20,160 --> 00:05:23,039 Speaker 1: Who does that? Or is it just handled by the 78 00:05:23,240 --> 00:05:26,840 Speaker 1: ugly lockey in markets? The individual markets well it's done 79 00:05:27,000 --> 00:05:31,080 Speaker 1: done by the national regulators um meeting together in in 80 00:05:31,080 --> 00:05:36,360 Speaker 1: in places like Bossel, Switzerland. So the problem, I think 81 00:05:36,480 --> 00:05:39,719 Speaker 1: is really whack a mole. That we had a banking 82 00:05:40,040 --> 00:05:44,360 Speaker 1: and shadow banking crisis ten years ago. We clamped down 83 00:05:44,360 --> 00:05:47,640 Speaker 1: on the banks, we increased capital and liquidity requirements for 84 00:05:47,680 --> 00:05:50,479 Speaker 1: the banks, but now we have problems elsewhere. We have 85 00:05:50,680 --> 00:05:55,760 Speaker 1: highly leveraged private equity funds that we're not a problem 86 00:05:55,880 --> 00:05:59,920 Speaker 1: ten years ago but posed financial stability risks now. I mean, 87 00:06:00,279 --> 00:06:03,160 Speaker 1: and within this whack amo is that a PG does 88 00:06:03,200 --> 00:06:06,880 Speaker 1: that in PhD and graduate studies only at Berkeley. Now 89 00:06:06,960 --> 00:06:10,000 Speaker 1: we do that undergraduate freshman class across the boarder across 90 00:06:10,000 --> 00:06:12,279 Speaker 1: the board to see whack a mole use at the 91 00:06:12,360 --> 00:06:17,000 Speaker 1: University of California as it should be. Within this rush 92 00:06:17,240 --> 00:06:20,880 Speaker 1: to where we're going next in global as a globalization 93 00:06:21,200 --> 00:06:23,560 Speaker 1: and as a president with this great dislike of the 94 00:06:23,600 --> 00:06:28,839 Speaker 1: word globalism, is the simple idea of where we're heading? 95 00:06:29,560 --> 00:06:33,640 Speaker 1: Do we know? Do we I mean from stiglets globalizing 96 00:06:33,720 --> 00:06:36,760 Speaker 1: in the discontents, do we know where we're heading five 97 00:06:36,800 --> 00:06:39,960 Speaker 1: and ten years out? Are we flying blind in our 98 00:06:40,080 --> 00:06:43,800 Speaker 1: dash to modern globalization? We are flying blind, But I'm 99 00:06:43,800 --> 00:06:49,960 Speaker 1: hopeful that UM. The destination will nonetheless be a managed 100 00:06:49,960 --> 00:06:55,760 Speaker 1: globalization UM, where we have a safety net for people 101 00:06:55,760 --> 00:06:59,440 Speaker 1: who are left behind, where governments provide the education and 102 00:06:59,520 --> 00:07:02,600 Speaker 1: training people need in order to move into new sectors 103 00:07:02,760 --> 00:07:09,320 Speaker 1: and activities, and maybe where we reinvigorate the institutions that 104 00:07:09,400 --> 00:07:11,760 Speaker 1: we need in order to to manage to create flows 105 00:07:11,760 --> 00:07:13,800 Speaker 1: and capital flows. Professor I could agree with me with 106 00:07:13,920 --> 00:07:18,480 Speaker 1: bad news. John has your book by his bedside. I 107 00:07:18,600 --> 00:07:22,080 Speaker 1: have it on kindle because I can't read the fund anymore. 108 00:07:22,120 --> 00:07:25,040 Speaker 1: My eyes just kidd. Because you publish, John, don't you 109 00:07:25,080 --> 00:07:27,880 Speaker 1: think you should publish in a larger You aid yourself 110 00:07:27,920 --> 00:07:30,880 Speaker 1: every do you know that I mean, I mean that costs. 111 00:07:30,920 --> 00:07:33,920 Speaker 1: I can green one dollar forty two cents and royalties 112 00:07:34,000 --> 00:07:37,440 Speaker 1: because my eyes filled me to get the audio book. Oh, 113 00:07:37,480 --> 00:07:40,880 Speaker 1: get the all go even further right, Barry's nodding. That's 114 00:07:40,920 --> 00:07:43,360 Speaker 1: a good idea we should do. I can green audiobooks. 115 00:07:43,560 --> 00:07:46,760 Speaker 1: Professor I can green. Thank you so much, Barry, I 116 00:07:46,800 --> 00:07:50,160 Speaker 1: can green of Berkeley. A wonderful way to begin this 117 00:07:50,280 --> 00:08:05,040 Speaker 1: last day of international meetings in New York. John, I 118 00:08:05,040 --> 00:08:06,880 Speaker 1: think we've done a great job to the ERIC team, 119 00:08:06,880 --> 00:08:09,480 Speaker 1: I should say has done a great job of the bigger, 120 00:08:09,480 --> 00:08:13,280 Speaker 1: broader picture. And that's Barry Green and Christopher Smart just 121 00:08:13,440 --> 00:08:16,160 Speaker 1: with us, among other wonderful guest Boy, do we have 122 00:08:16,200 --> 00:08:19,200 Speaker 1: the right person to talk to you about the linkage 123 00:08:19,320 --> 00:08:25,280 Speaker 1: of markets over into the financial and fiscal stance of Europe? Absolutely? 124 00:08:25,320 --> 00:08:27,640 Speaker 1: In the fiscal stance of Italy is where the headline 125 00:08:27,680 --> 00:08:30,080 Speaker 1: is today, as the populist get together and agree on 126 00:08:30,080 --> 00:08:31,840 Speaker 1: a budget, but a bigger one than a lot of 127 00:08:31,840 --> 00:08:34,240 Speaker 1: people expected before this week, two point four percent of 128 00:08:34,320 --> 00:08:37,680 Speaker 1: g D P BTPs go lower, Italian bondyields go higher 129 00:08:37,720 --> 00:08:40,679 Speaker 1: by thirty two basis points on the day so far. 130 00:08:40,960 --> 00:08:42,600 Speaker 1: Johann to go some plased to say he used to 131 00:08:42,600 --> 00:08:44,959 Speaker 1: work in the city tom Over by a Liverpool street 132 00:08:45,000 --> 00:08:47,520 Speaker 1: station at RBS, and now he's too good for that. 133 00:08:47,760 --> 00:08:51,199 Speaker 1: He works over in Mayfair at Algebras Macro Strategies. He's 134 00:08:51,240 --> 00:08:53,360 Speaker 1: the head over there. Alberto, always great to catch you 135 00:08:53,400 --> 00:08:55,960 Speaker 1: with the Alberto Gallo joining us. Now what is happening 136 00:08:55,960 --> 00:09:00,400 Speaker 1: in Italy? Alberto, Hi, John, I think today we're seeing 137 00:09:00,440 --> 00:09:06,400 Speaker 1: is an unexpected uh, an unexpected reaction. The market was 138 00:09:06,440 --> 00:09:10,480 Speaker 1: already bracing for a slightly higher number. But what happened 139 00:09:10,480 --> 00:09:13,160 Speaker 1: is that the government said they would keep a deficit 140 00:09:13,240 --> 00:09:16,760 Speaker 1: of two point four percent of GDP for three years, 141 00:09:17,040 --> 00:09:20,480 Speaker 1: and they've also back tracked on some of the reforms 142 00:09:20,520 --> 00:09:23,040 Speaker 1: in particularly the labor reform that was done by the 143 00:09:23,080 --> 00:09:27,200 Speaker 1: previous government. So this is a bit um far fetched. 144 00:09:27,920 --> 00:09:30,800 Speaker 1: We have to remember though, that this budget is a proposal, 145 00:09:31,080 --> 00:09:34,760 Speaker 1: and that the deficit last year was two point three percent, 146 00:09:34,880 --> 00:09:38,440 Speaker 1: so pretty close to what they're aiming for for two 147 00:09:38,320 --> 00:09:42,800 Speaker 1: thousand nineteen and um. And therefore, you know, in the 148 00:09:43,160 --> 00:09:47,040 Speaker 1: we're talking about fractions of of a of a percent here. 149 00:09:47,840 --> 00:09:50,760 Speaker 1: But I think the general attitude is one of of 150 00:09:51,080 --> 00:09:54,960 Speaker 1: the science towards the market, and that's why investors are, 151 00:09:56,000 --> 00:10:00,559 Speaker 1: you know, reacting with with a cell to day, and 152 00:10:00,600 --> 00:10:03,960 Speaker 1: we see it across both the government bonds and the 153 00:10:04,000 --> 00:10:09,240 Speaker 1: equities in the country. But there's little contagion across Europe 154 00:10:09,640 --> 00:10:13,480 Speaker 1: unlike in previous In previous cases, Yeah, and quite clearly, 155 00:10:13,520 --> 00:10:15,680 Speaker 1: the market is drawn the distinction between what does increased 156 00:10:15,679 --> 00:10:18,680 Speaker 1: BTP supply risk and what would be redenomination risk, and 157 00:10:18,720 --> 00:10:20,560 Speaker 1: it seems to me that the former is playing out 158 00:10:20,559 --> 00:10:23,280 Speaker 1: in the market today our bed so and not the latter. 159 00:10:23,720 --> 00:10:25,600 Speaker 1: And it makes me wonder we see a knee jerk 160 00:10:25,640 --> 00:10:29,040 Speaker 1: reaction just to sell European risk today, sell down European 161 00:10:29,040 --> 00:10:31,760 Speaker 1: assets Alberta for someone that manages money. As you look 162 00:10:31,800 --> 00:10:34,040 Speaker 1: at things right now and look across the various markets 163 00:10:34,040 --> 00:10:36,280 Speaker 1: on the Bloomberg screens, where would you be picking up 164 00:10:36,280 --> 00:10:41,920 Speaker 1: the pieces this morning, John, Look, we haven't said this 165 00:10:42,040 --> 00:10:44,600 Speaker 1: in a while, um, but for the first time, things 166 00:10:44,600 --> 00:10:47,480 Speaker 1: are starting to look to look cheap. Um. You know, 167 00:10:48,080 --> 00:10:51,440 Speaker 1: we have not just in excluded Italy. You know, look 168 00:10:51,480 --> 00:10:54,200 Speaker 1: at Spain, Look at the UK. We have you know, 169 00:10:54,360 --> 00:10:59,600 Speaker 1: dead from Barclays, which is wider than Ecuador. We have, um, 170 00:10:59,640 --> 00:11:04,120 Speaker 1: you know, credit spreads in Spanish companies that have nothing 171 00:11:04,160 --> 00:11:06,800 Speaker 1: to do with you know, with Italy. There are exporters 172 00:11:06,840 --> 00:11:10,520 Speaker 1: which are two times the spread of US companies for 173 00:11:10,559 --> 00:11:14,480 Speaker 1: the same breeding. So Europe has been unloved. There's obviously 174 00:11:14,520 --> 00:11:18,320 Speaker 1: a lot of political twists and turns, a lot of drama. 175 00:11:19,000 --> 00:11:21,800 Speaker 1: But the populism that we have here is not the 176 00:11:21,840 --> 00:11:24,240 Speaker 1: populace we have in Latin America. You know, the populace 177 00:11:24,360 --> 00:11:27,079 Speaker 1: in Europe is very focused on migration. Yes, it may 178 00:11:27,160 --> 00:11:32,160 Speaker 1: deviate by point one percent on spending, but you know, 179 00:11:32,559 --> 00:11:36,560 Speaker 1: we're not talking about emerging market, you know, far left 180 00:11:37,840 --> 00:11:41,560 Speaker 1: side populism. So we think sometimes investors don't differentiate enough 181 00:11:41,679 --> 00:11:46,480 Speaker 1: between UM. You know the situation in U in Brazil, 182 00:11:46,720 --> 00:11:50,360 Speaker 1: or in UH in Venezuela, and and and uh and 183 00:11:50,360 --> 00:11:53,520 Speaker 1: and and and what happened in Europe. Alberta, good morning. 184 00:11:53,520 --> 00:11:57,800 Speaker 1: It's brilliantly said. And I understand the idea of the opportunity, 185 00:11:58,240 --> 00:12:02,160 Speaker 1: But where is the opportunity if something is cheaper than Ecuador, 186 00:12:02,600 --> 00:12:06,720 Speaker 1: priced down, yield sky high, or even in the equity markets, 187 00:12:06,840 --> 00:12:11,920 Speaker 1: where is the identified Alberto Gallo opportunity? I think the 188 00:12:11,960 --> 00:12:15,680 Speaker 1: equity market is is a little bit more dependent on flows. 189 00:12:15,800 --> 00:12:18,200 Speaker 1: And you know, obviously the US investors have been out 190 00:12:18,240 --> 00:12:21,040 Speaker 1: of the European game for a while, so the equity 191 00:12:21,080 --> 00:12:24,560 Speaker 1: market has become a value play. Is very cheap, but 192 00:12:24,679 --> 00:12:27,720 Speaker 1: you need money to go in. But for that you 193 00:12:27,760 --> 00:12:30,520 Speaker 1: don't need that. You just need to wait. And as 194 00:12:30,600 --> 00:12:34,080 Speaker 1: long as Europe doesn't have UM, you know the tail 195 00:12:34,200 --> 00:12:37,080 Speaker 1: risk that every that it's priced into the market, and 196 00:12:37,160 --> 00:12:40,520 Speaker 1: we know that we're pricing a breakup risk. Again, you 197 00:12:40,559 --> 00:12:43,000 Speaker 1: get paid very well to wait. You get paid deals 198 00:12:43,000 --> 00:12:45,880 Speaker 1: of six seven percent in euro which in dollars are 199 00:12:45,960 --> 00:12:48,880 Speaker 1: close to ten percent. So these yields in the US 200 00:12:49,000 --> 00:12:52,360 Speaker 1: market you only get for now for threeple C companies, 201 00:12:52,400 --> 00:12:56,079 Speaker 1: which are you know, very never and and and and 202 00:12:56,080 --> 00:12:58,760 Speaker 1: we're almost closely the fold to two years ago. How 203 00:12:58,800 --> 00:13:03,199 Speaker 1: long do I have to wait for it was? It's 204 00:13:03,240 --> 00:13:06,840 Speaker 1: going to be I'm not saying bolatility one stay here. 205 00:13:07,720 --> 00:13:11,920 Speaker 1: The political game in Italy with the five star in 206 00:13:11,960 --> 00:13:15,440 Speaker 1: Northern League is going to remain volatile. The brexit um 207 00:13:15,920 --> 00:13:18,240 Speaker 1: game is going to remain volatile. So we focused on 208 00:13:18,360 --> 00:13:20,800 Speaker 1: bonds that have two or three four years maturity so 209 00:13:20,880 --> 00:13:23,600 Speaker 1: that we focus on the on the credit risk of 210 00:13:23,640 --> 00:13:26,079 Speaker 1: the single companies. John, did you see how my light 211 00:13:26,160 --> 00:13:29,560 Speaker 1: American humor went over like them? You know, well, I 212 00:13:29,600 --> 00:13:32,679 Speaker 1: lived I lived this on a daily basis, not just 213 00:13:32,880 --> 00:13:36,640 Speaker 1: better it's not familiarized them, but then just completely miss that. 214 00:13:36,640 --> 00:13:39,360 Speaker 1: That's okay, Albert So, last year you had a great 215 00:13:39,400 --> 00:13:43,160 Speaker 1: year managing European credit with some decent returns. Um it 216 00:13:43,200 --> 00:13:45,640 Speaker 1: was tougher, you did well. This year has been slightly 217 00:13:45,640 --> 00:13:47,959 Speaker 1: more difficult, Albert So, and I'm wondering what your thoughts 218 00:13:47,960 --> 00:13:50,120 Speaker 1: are on that how difficult it is to make returns, 219 00:13:50,160 --> 00:13:54,560 Speaker 1: generate returns, total returns in Europe right now when the 220 00:13:54,600 --> 00:13:57,000 Speaker 1: e CP is pulling back and they've distorted the credit 221 00:13:57,040 --> 00:14:01,880 Speaker 1: market so much. Yeah, there is a part of the 222 00:14:01,960 --> 00:14:06,400 Speaker 1: debt market, investment grade debt market, which became really tied 223 00:14:06,480 --> 00:14:09,320 Speaker 1: in yield because of ECB purchases. I mean, we're focusing 224 00:14:09,400 --> 00:14:14,280 Speaker 1: on companies that have slightly lower rating that or banks 225 00:14:14,320 --> 00:14:16,240 Speaker 1: that we're not bought by d c B. D c 226 00:14:16,360 --> 00:14:21,440 Speaker 1: B cannot buy banks because they regulate banks, and um, 227 00:14:21,640 --> 00:14:25,240 Speaker 1: we think that there is a very good yield at 228 00:14:25,240 --> 00:14:28,440 Speaker 1: the moment. Obviously, the market market has been volatile. There's 229 00:14:28,480 --> 00:14:32,600 Speaker 1: been you know, noisy headlines from southern Europe from Brexit, 230 00:14:33,000 --> 00:14:37,479 Speaker 1: and investors have gone away. We have reduced are we've 231 00:14:37,520 --> 00:14:40,280 Speaker 1: freed up some dry polor in in the first quarter 232 00:14:40,360 --> 00:14:43,360 Speaker 1: as we saw the market was turning. We're now we're 233 00:14:43,360 --> 00:14:47,320 Speaker 1: now looking for opportunities and adding and we think that 234 00:14:47,760 --> 00:14:49,960 Speaker 1: you know, we're not taking a tenure of view here. 235 00:14:50,080 --> 00:14:52,560 Speaker 1: We don't know what will happen to Italy on a 236 00:14:52,600 --> 00:14:55,680 Speaker 1: tenure of view, or Spain or the UK. But if 237 00:14:55,720 --> 00:14:59,720 Speaker 1: you are confident about Europe not breaking in the next 238 00:14:59,720 --> 00:15:02,320 Speaker 1: two three years, then you get paid very well. You 239 00:15:02,400 --> 00:15:06,520 Speaker 1: get paid between seven and ten percent in dollar equivalent. Albertagalo, 240 00:15:06,680 --> 00:15:08,840 Speaker 1: thank you so much for this briefing this morning. He's 241 00:15:08,920 --> 00:15:21,840 Speaker 1: with Algebras now the most important interview of the day, 242 00:15:21,960 --> 00:15:27,280 Speaker 1: without question, on governance, on board management, and of course 243 00:15:27,320 --> 00:15:29,880 Speaker 1: that means on the latest story of Tesla right now, 244 00:15:29,880 --> 00:15:33,160 Speaker 1: two hundred seventy dollars apper share is some form of 245 00:15:33,200 --> 00:15:38,360 Speaker 1: indication down from a previous three oh seven. John Coffee, 246 00:15:38,360 --> 00:15:41,680 Speaker 1: across the Bloomberg, we have seen hundreds and hundreds of 247 00:15:41,720 --> 00:15:45,440 Speaker 1: headlines on a given story. In about an hour ago, 248 00:15:45,480 --> 00:15:49,640 Speaker 1: Professor Coffee, we saw a headline that said Tesla shares 249 00:15:50,320 --> 00:15:55,040 Speaker 1: have a hundred and thirty dollar quote Musk premium unquote 250 00:15:55,280 --> 00:16:00,160 Speaker 1: that may go away. This according to Barclay's Securities Analysis, 251 00:16:00,560 --> 00:16:04,240 Speaker 1: John Coffee of Columbia, How does a board react to 252 00:16:04,320 --> 00:16:08,000 Speaker 1: a headline of their CEO and founder like that that 253 00:16:08,120 --> 00:16:11,840 Speaker 1: Tesla shares they have a hundred and thirty dollar must premium. 254 00:16:12,040 --> 00:16:15,080 Speaker 1: What should a board do well? I think they have 255 00:16:15,240 --> 00:16:18,400 Speaker 1: to react and they have to get Mr Musk to settle. 256 00:16:18,880 --> 00:16:23,000 Speaker 1: The sec doesn't normally seek a bar order, which would 257 00:16:23,000 --> 00:16:26,360 Speaker 1: prohibit a corporate executive from serving as a director or 258 00:16:26,440 --> 00:16:29,280 Speaker 1: officer of a public company, but they may be doing 259 00:16:29,320 --> 00:16:32,560 Speaker 1: it here because he has refused to settle in their 260 00:16:32,560 --> 00:16:37,200 Speaker 1: earlier negotiations. Most corporate executives will settle quickly with the 261 00:16:37,320 --> 00:16:41,600 Speaker 1: SEC because the dollars involved aren't large. But Mr Musk 262 00:16:41,800 --> 00:16:45,560 Speaker 1: is fiercely independent and a maverick, and he isn't willing 263 00:16:45,600 --> 00:16:48,400 Speaker 1: to settle, even though he does not have a legal 264 00:16:48,640 --> 00:16:52,360 Speaker 1: leg to stand on with respect to the SEC's complaint 265 00:16:52,600 --> 00:16:55,720 Speaker 1: that he said he had funding secured when he certainly 266 00:16:55,760 --> 00:16:59,120 Speaker 1: did not. Now the board has to recognize that the 267 00:16:59,160 --> 00:17:01,880 Speaker 1: market is going to bounce around because it cannot yet 268 00:17:01,920 --> 00:17:05,439 Speaker 1: evaluate how serious the SEC is about a bar bar 269 00:17:05,640 --> 00:17:09,360 Speaker 1: order and how serious Mr Musk is about not settling. 270 00:17:10,119 --> 00:17:13,840 Speaker 1: But not settling will make this prospect loom larger and 271 00:17:14,000 --> 00:17:17,040 Speaker 1: larger that the SEC could seek to get the Church 272 00:17:17,160 --> 00:17:19,320 Speaker 1: to grant a bar order. I'm not sure the judge will, 273 00:17:19,520 --> 00:17:21,760 Speaker 1: but it's going to be the biggest risk the company's faces. 274 00:17:21,840 --> 00:17:26,560 Speaker 1: Do the members of the board have risk or liability 275 00:17:26,720 --> 00:17:31,000 Speaker 1: if they make incorrect decisions here? Well, they can ask 276 00:17:31,080 --> 00:17:33,600 Speaker 1: him to settle, but they really can't force him to settle. 277 00:17:33,680 --> 00:17:36,760 Speaker 1: The company has not been sued. The SEC didn't feel 278 00:17:36,760 --> 00:17:39,439 Speaker 1: the company did anything wrong, so I don't know that 279 00:17:39,520 --> 00:17:42,719 Speaker 1: they have great liability where they have not been sued 280 00:17:43,119 --> 00:17:45,440 Speaker 1: and where they can ask him, but they can't force 281 00:17:45,520 --> 00:17:48,879 Speaker 1: him to settle. Professor. There's enough cause for concern in 282 00:17:48,920 --> 00:17:51,680 Speaker 1: the suit. I'm just reading through it. Um. The sec 283 00:17:51,760 --> 00:17:55,000 Speaker 1: alleging that he got to the price by adding to 284 00:17:55,040 --> 00:17:57,679 Speaker 1: the weather stock was training. It got to four nineteen 285 00:17:57,760 --> 00:18:00,160 Speaker 1: they rounded up to for twenty two impresses Gale from 286 00:18:00,160 --> 00:18:02,720 Speaker 1: because he thought she should find it funny. Um. Professor, 287 00:18:02,800 --> 00:18:04,760 Speaker 1: surely that's enough reason for the board to sit here 288 00:18:04,760 --> 00:18:07,920 Speaker 1: and say, I'll see I need some assistance. Um. Could 289 00:18:07,960 --> 00:18:11,000 Speaker 1: this be a positive catalyst for change? Well, I think 290 00:18:11,040 --> 00:18:13,359 Speaker 1: the board does need to sit down with him and 291 00:18:13,400 --> 00:18:15,920 Speaker 1: tell him to be mature. It's not going to cost 292 00:18:16,000 --> 00:18:19,879 Speaker 1: him anything, and he is jeopardizing the company's future. And 293 00:18:19,920 --> 00:18:22,399 Speaker 1: I think the board, frankly, is not a strong board. 294 00:18:22,840 --> 00:18:26,520 Speaker 1: This is a board of old friends, old retainers and sycophants, 295 00:18:26,560 --> 00:18:29,560 Speaker 1: with maybe Mr Murdoch being the only person who's noteworthy 296 00:18:29,600 --> 00:18:31,959 Speaker 1: on it. And so the board has to get together 297 00:18:32,000 --> 00:18:34,560 Speaker 1: and recognize they have to do something which they haven't 298 00:18:34,560 --> 00:18:37,439 Speaker 1: done in the past. Professor, how much and to what 299 00:18:37,560 --> 00:18:40,520 Speaker 1: extent does this impair the company operationally? Speaking to have 300 00:18:40,600 --> 00:18:43,480 Speaker 1: this hanging over the company at the moment, and the 301 00:18:43,520 --> 00:18:47,119 Speaker 1: CEO Elon Masque, Well, I think they have to worry that. 302 00:18:47,320 --> 00:18:49,399 Speaker 1: First of all, it's going to divert his time, and 303 00:18:49,440 --> 00:18:51,639 Speaker 1: the company needs a hundred and ten percent of his 304 00:18:51,720 --> 00:18:56,600 Speaker 1: time because they haven't yet successfully sustained the gold for 305 00:18:56,720 --> 00:18:59,359 Speaker 1: output per month that he has been promising and in 306 00:18:59,480 --> 00:19:02,199 Speaker 1: which he has said is a key to profitability. And 307 00:19:02,240 --> 00:19:05,080 Speaker 1: now you add litigation, which diverts a good deal of 308 00:19:05,160 --> 00:19:08,080 Speaker 1: his time. Uh, and you add the risk that there's 309 00:19:08,160 --> 00:19:11,000 Speaker 1: no one in the house to replace him. So I 310 00:19:11,040 --> 00:19:14,400 Speaker 1: think the earlier he can resolve this by giving up 311 00:19:14,480 --> 00:19:17,639 Speaker 1: his pride to a degree and recognizing that he can 312 00:19:17,680 --> 00:19:21,119 Speaker 1: reach a fairly cheap settlement. There aren't any real damages 313 00:19:21,240 --> 00:19:25,640 Speaker 1: here that the sec is seen. Well, let's see it there. 314 00:19:25,640 --> 00:19:27,960 Speaker 1: Professor Coffee, thank you so much for your time this 315 00:19:28,000 --> 00:19:31,560 Speaker 1: morning with Blue Work Surveillance on television and on radio. 316 00:19:31,680 --> 00:19:35,399 Speaker 1: John Coffee of Columbia Law on governance of this morning 317 00:19:46,720 --> 00:19:48,840 Speaker 1: right now? Is we really try on this Friday with 318 00:19:48,880 --> 00:19:52,680 Speaker 1: a huge news floated game perspective. Lankmark joins us. She's 319 00:19:52,680 --> 00:19:56,919 Speaker 1: a Brookings uh and author of an incisive book on 320 00:19:57,119 --> 00:20:03,360 Speaker 1: president failure. In successes. It's it's extremely entertaining read why 321 00:20:03,440 --> 00:20:06,879 Speaker 1: presidents fail and how they can succeed again, about the 322 00:20:06,920 --> 00:20:13,240 Speaker 1: resiliency of the executive institution. How's our legislative institution doing? Elaine, 323 00:20:13,320 --> 00:20:18,960 Speaker 1: It's been uh eventful two or three days of always 324 00:20:19,040 --> 00:20:22,160 Speaker 1: political posturing, and many would say on both sides of this. 325 00:20:22,680 --> 00:20:27,159 Speaker 1: Kavanaugh debates some substance as well, give us your report 326 00:20:27,200 --> 00:20:33,800 Speaker 1: card on the Judiciary Committee in America's legislative process. Well, 327 00:20:33,960 --> 00:20:37,959 Speaker 1: I don't. I think the Judiciary Committee gets probably about 328 00:20:37,960 --> 00:20:41,320 Speaker 1: a C minus or a D. I mean, on the 329 00:20:41,359 --> 00:20:44,359 Speaker 1: one hand, you got to give them credit for the 330 00:20:44,400 --> 00:20:48,480 Speaker 1: fact that this was a very impossible situation. On the 331 00:20:48,520 --> 00:20:53,680 Speaker 1: other hand, that both Democrats and Republicans failed to handle 332 00:20:53,800 --> 00:20:57,280 Speaker 1: this as they should have. Um you know, the Democrats 333 00:20:57,320 --> 00:21:01,119 Speaker 1: should have made this available earlier. They should have said 334 00:21:01,160 --> 00:21:05,399 Speaker 1: to to um Dr Ford, Look, there's no way we 335 00:21:05,480 --> 00:21:08,639 Speaker 1: can just get this into the into play without you 336 00:21:08,760 --> 00:21:13,280 Speaker 1: coming out. You must reveal yourself otherwise people can't judge this. 337 00:21:13,480 --> 00:21:17,200 Speaker 1: So that was somebody should have leveled with her. I mean, 338 00:21:17,200 --> 00:21:21,160 Speaker 1: it's not her fault. She she's not sophisticated in these things. 339 00:21:21,240 --> 00:21:23,520 Speaker 1: But you know, it was clear that this was not 340 00:21:23,560 --> 00:21:26,800 Speaker 1: going to be meaningful unless she came forward, and they 341 00:21:26,880 --> 00:21:30,200 Speaker 1: billy dallied way too long on that. On the other hand, 342 00:21:30,440 --> 00:21:33,840 Speaker 1: the Republicans have, first of all, no women on the 343 00:21:33,920 --> 00:21:37,399 Speaker 1: Judiciary Committee. Um, that's a problem. So they had to 344 00:21:37,520 --> 00:21:40,000 Speaker 1: hire a woman to speak for them, and then they 345 00:21:40,080 --> 00:21:44,199 Speaker 1: quickly abandoned her. Um midway through the midway let me 346 00:21:44,200 --> 00:21:48,120 Speaker 1: interrupt her talk. Let me interrupt, because that's right where 347 00:21:48,119 --> 00:21:52,440 Speaker 1: I wanted to go. Ronald Clain, folks, whatever your politics, 348 00:21:52,600 --> 00:21:55,960 Speaker 1: is a really bright guy. He worked for President Obama. 349 00:21:56,000 --> 00:21:58,479 Speaker 1: I think we can say that ron Klain has an 350 00:21:58,480 --> 00:22:01,600 Speaker 1: affinity to the Democratic Party. And he came out in 351 00:22:01,640 --> 00:22:05,880 Speaker 1: the Washington Post Dr Cmark today and said ron Klain 352 00:22:06,080 --> 00:22:10,600 Speaker 1: was wrong and that Rachel Mitchell was a disaster. Discussed 353 00:22:10,640 --> 00:22:14,000 Speaker 1: further what a Democrat like ron Claine says he was 354 00:22:14,080 --> 00:22:19,320 Speaker 1: supporting Republicans and having Ms Mitchell do her questioning and 355 00:22:19,680 --> 00:22:23,360 Speaker 1: boy didn't go down in flames. Yeah. I mean, ron 356 00:22:23,520 --> 00:22:25,760 Speaker 1: Is is a friend of mine and I completely agree 357 00:22:25,800 --> 00:22:28,240 Speaker 1: with him, and I think most people agree that this 358 00:22:28,560 --> 00:22:31,800 Speaker 1: was not a good move. And not only was it 359 00:22:31,840 --> 00:22:34,720 Speaker 1: not a good move, because she she was accustomed to 360 00:22:34,760 --> 00:22:39,120 Speaker 1: a courtroom setting and the Senate Judiciary Committee is not exactly, 361 00:22:39,160 --> 00:22:43,320 Speaker 1: of course, thank you, okay. And so she and the 362 00:22:43,320 --> 00:22:47,760 Speaker 1: the senators clearly grew very very impatient with her, and 363 00:22:47,960 --> 00:22:51,040 Speaker 1: so it was kind of a double whammy. A they 364 00:22:51,040 --> 00:22:53,880 Speaker 1: were so insecure best speaking for themselves that they had 365 00:22:53,920 --> 00:22:57,600 Speaker 1: to hire themselves a woman, and then very publicly they 366 00:22:57,600 --> 00:23:00,880 Speaker 1: sort of fired the woman. So with you know, they 367 00:23:00,920 --> 00:23:04,199 Speaker 1: really didn't get in. They really got nothing out of 368 00:23:04,240 --> 00:23:08,160 Speaker 1: this adventure. Dr Comark, I've only got nineties seconds left, 369 00:23:08,200 --> 00:23:10,000 Speaker 1: and I don't want to get into, you know, the 370 00:23:10,080 --> 00:23:13,920 Speaker 1: AM talk show, cable news back and forth on here. 371 00:23:14,440 --> 00:23:18,560 Speaker 1: Who were the senators speaking to yesterday? If you know 372 00:23:18,640 --> 00:23:21,719 Speaker 1: I listened to senator to senator, I couldn't. I had 373 00:23:21,760 --> 00:23:24,200 Speaker 1: to first figure out who they were talking to. Who 374 00:23:24,200 --> 00:23:28,280 Speaker 1: were they talking to yesterday? The Republican senators were talking 375 00:23:28,320 --> 00:23:32,400 Speaker 1: to their base, no doubt about it. Democrats senators, they weren't. 376 00:23:32,400 --> 00:23:37,360 Speaker 1: No Democratic senators were talking to a wider electorate, particularly 377 00:23:37,400 --> 00:23:42,359 Speaker 1: electorate of potential women, Republican women who are the potential 378 00:23:42,480 --> 00:23:45,440 Speaker 1: swing voters in just two months. That's who they were 379 00:23:45,440 --> 00:23:48,200 Speaker 1: talking to. And there was there were two very different 380 00:23:48,200 --> 00:23:51,960 Speaker 1: conversations going on there. The Democrats trying to expand their 381 00:23:52,000 --> 00:23:55,040 Speaker 1: pool of voters and the Republicans trying to rev up 382 00:23:55,160 --> 00:23:59,800 Speaker 1: their base. Though, that's why you saw such different approaches. Lankmarks, 383 00:24:00,000 --> 00:24:01,960 Speaker 1: thank you so much. She's with Brookings and it's a 384 00:24:02,000 --> 00:24:05,639 Speaker 1: twisted book. I really can't say enough about why presidents 385 00:24:05,680 --> 00:24:08,680 Speaker 1: fail and how they can succeed again. It is not 386 00:24:08,840 --> 00:24:12,000 Speaker 1: the normal path through the executive branch, and it is 387 00:24:12,040 --> 00:24:16,800 Speaker 1: informative and illuminating as well. John, Why presidents fail and 388 00:24:16,840 --> 00:24:30,200 Speaker 1: how they can succeed again. It's an interesting one. The 389 00:24:30,280 --> 00:24:33,280 Speaker 1: first time I met Jeff Flake, folks, he was essentially 390 00:24:33,840 --> 00:24:37,199 Speaker 1: on a national basis unknown as a congressman from Arizona, 391 00:24:37,640 --> 00:24:40,479 Speaker 1: and we spoke about his Mormon faith, his family as 392 00:24:40,520 --> 00:24:44,000 Speaker 1: a heritage of Northern Arizona Church of Jesus Christ of 393 00:24:44,080 --> 00:24:47,600 Speaker 1: Latter day Saints like no one else. His great great 394 00:24:47,600 --> 00:24:50,960 Speaker 1: grandfather was truly one of the pioneers of the Mormon Church, 395 00:24:51,040 --> 00:24:53,800 Speaker 1: William J. Flake. And he has just said he will 396 00:24:54,119 --> 00:24:57,919 Speaker 1: vote to confirm Mr Kavanaugh. Shannon Petty Peace knows the 397 00:24:57,960 --> 00:25:02,400 Speaker 1: calculus of all this, the Western in calculus, Arizona calculus, 398 00:25:02,440 --> 00:25:05,640 Speaker 1: and Shannon, from your purview at the White House, the 399 00:25:05,720 --> 00:25:09,560 Speaker 1: Washington calculus as well. Were you surprised, Shannon Petty Peace 400 00:25:09,880 --> 00:25:13,720 Speaker 1: to see Mr Flake uh show his support for Judge Kavanaugh. 401 00:25:14,240 --> 00:25:17,600 Speaker 1: I was not surprised. He I felt tipped his hand 402 00:25:17,640 --> 00:25:21,000 Speaker 1: a little bit this way. Yesterday he made some remarks 403 00:25:21,040 --> 00:25:23,960 Speaker 1: at the end of the Kavanaugh hearing, saying, um that 404 00:25:24,400 --> 00:25:28,199 Speaker 1: you know, we are one senators on this committee. We 405 00:25:28,240 --> 00:25:31,360 Speaker 1: are humans. Uh, you know, we're mortals trying to make 406 00:25:31,359 --> 00:25:34,959 Speaker 1: a decision that is very complex. Uh. There will be doubt, 407 00:25:35,440 --> 00:25:37,840 Speaker 1: there will never be pure certainty. And I felt like 408 00:25:37,840 --> 00:25:40,200 Speaker 1: it was sort of paving the way for him to say, well, 409 00:25:40,400 --> 00:25:43,120 Speaker 1: I might have my doubts, but um, yeah, I'm I'm 410 00:25:43,160 --> 00:25:46,840 Speaker 1: gonna to you know, to vote for Kavanaugh anyway. Um. Also, 411 00:25:47,200 --> 00:25:50,480 Speaker 1: I mean you mentioned very well his um Mormon faith. 412 00:25:50,560 --> 00:25:54,359 Speaker 1: He is a true conservative. Kavanaugh is a true conservative. 413 00:25:54,640 --> 00:25:58,399 Speaker 1: You know, whatever questions they might have about Kavanaugh's character 414 00:25:59,200 --> 00:26:01,800 Speaker 1: now or at the young man, they are fundamentally in 415 00:26:01,880 --> 00:26:04,520 Speaker 1: line with his belief And I bring it up Shannon 416 00:26:04,560 --> 00:26:08,920 Speaker 1: as a Western conservatism maybe versus what the media he sees. Shannon, 417 00:26:08,960 --> 00:26:10,920 Speaker 1: you've you've been a student of this for so long. 418 00:26:11,160 --> 00:26:14,720 Speaker 1: With that headline, what changes right now within that Judiciary 419 00:26:14,760 --> 00:26:19,080 Speaker 1: Committee hearing? Right well, So now I mean, and I 420 00:26:19,119 --> 00:26:22,560 Speaker 1: think it does seem likely that this gets out of 421 00:26:22,600 --> 00:26:25,880 Speaker 1: the that this gets out of the Senate Judiciary Committee. Um. 422 00:26:26,160 --> 00:26:28,679 Speaker 1: But that's the first hurdle. So now I think the 423 00:26:28,680 --> 00:26:32,480 Speaker 1: big focuses on what happens when the full Senate votes. 424 00:26:33,000 --> 00:26:36,160 Speaker 1: There's this fifty one forty nine split with the Vice 425 00:26:36,160 --> 00:26:38,960 Speaker 1: president as a tiebreaker. Uh, so they can only lose 426 00:26:39,000 --> 00:26:42,080 Speaker 1: two Republican votes. So the two Republicans remaining UM as 427 00:26:42,080 --> 00:26:45,959 Speaker 1: in a flashback to UM this Obamacare debate, is Susan 428 00:26:46,000 --> 00:26:49,840 Speaker 1: Collins and Lisa Murkowski. So all eyes turned to them. Now, 429 00:26:50,320 --> 00:26:54,639 Speaker 1: UM Also, UM, Mansion from West Virginia has has UM 430 00:26:54,680 --> 00:26:57,160 Speaker 1: indicated you know, he's on the fence about this. So 431 00:26:57,280 --> 00:27:00,760 Speaker 1: even if the two of them uh part off. Uh, 432 00:27:01,240 --> 00:27:03,960 Speaker 1: you know, Mansion could UM from you know, the Democratic 433 00:27:04,000 --> 00:27:07,400 Speaker 1: senator from West Virginia could vote UM for Kavanaugh and 434 00:27:07,560 --> 00:27:10,200 Speaker 1: shift off that balance to the four of these senators 435 00:27:10,240 --> 00:27:13,080 Speaker 1: met last night and didn't come to any conclusion. But 436 00:27:13,119 --> 00:27:16,439 Speaker 1: these Flake Collins, Marokowskian, Mansion uh sort of had their 437 00:27:16,480 --> 00:27:20,280 Speaker 1: own undecided conference, and there was I thinking at one 438 00:27:20,280 --> 00:27:22,359 Speaker 1: point that they might all sort of go in together 439 00:27:22,400 --> 00:27:24,400 Speaker 1: as a pack, you know, all for one and one 440 00:27:24,440 --> 00:27:27,800 Speaker 1: for all. Um. Flakes now broken off of that, so 441 00:27:27,840 --> 00:27:29,800 Speaker 1: we could see the other ones come into line quite soon. 442 00:27:30,040 --> 00:27:32,360 Speaker 1: And the White House they've they've been feeling very confident 443 00:27:32,359 --> 00:27:36,639 Speaker 1: since last night that the Republicans were closing ranks around Kavanaugh. Uh, 444 00:27:37,200 --> 00:27:40,720 Speaker 1: and it's going to be moved forward and unified fashion 445 00:27:40,880 --> 00:27:44,399 Speaker 1: by the time that Kavanaugh hearing ended yesterday. Shannon just 446 00:27:44,440 --> 00:27:46,800 Speaker 1: to go back to Senator Flake for a moment. In 447 00:27:46,920 --> 00:27:53,160 Speaker 1: March of sixteen, he said that Judge Merrick Garland, who 448 00:27:53,320 --> 00:27:57,919 Speaker 1: was President Barack Obama's nominee for the Supreme Court, should 449 00:27:57,960 --> 00:28:02,240 Speaker 1: not be confirmed unless US Hillary Clinton wins or one 450 00:28:02,320 --> 00:28:09,880 Speaker 1: of the past tense won presidential election. And that's been 451 00:28:10,000 --> 00:28:13,320 Speaker 1: this ultimate irony of all this is the Merrick Garland 452 00:28:13,800 --> 00:28:16,640 Speaker 1: nomination was held up for I think it was two 453 00:28:16,720 --> 00:28:20,359 Speaker 1: hundred something days. Uh. That seat was left open, and 454 00:28:20,440 --> 00:28:25,960 Speaker 1: yet the Republicans have been um protesting the delay of 455 00:28:26,000 --> 00:28:27,879 Speaker 1: a few days of a vote in order to have 456 00:28:27,960 --> 00:28:32,439 Speaker 1: this hearing. Uh. They've they've raised such outrage about the 457 00:28:32,480 --> 00:28:34,480 Speaker 1: timing of this having to be pushed back. When that 458 00:28:34,520 --> 00:28:38,040 Speaker 1: Supreme Court seat was held open for an enormous amount 459 00:28:38,080 --> 00:28:41,880 Speaker 1: of time. Uh, and when we saw Lindsay Graham make 460 00:28:42,000 --> 00:28:47,360 Speaker 1: this very impassioned UH speech yesterday before the committee. One 461 00:28:47,360 --> 00:28:49,600 Speaker 1: of the things he said is that, you know, he 462 00:28:49,640 --> 00:28:55,000 Speaker 1: knows Democrats wanna, you know, uh, spike this nomination and 463 00:28:55,080 --> 00:28:58,520 Speaker 1: keep the seat open until to see if they can 464 00:28:58,520 --> 00:29:01,840 Speaker 1: get a Democrat in the White House. So the Republicans 465 00:29:01,880 --> 00:29:03,880 Speaker 1: have that feeling too, that this is all in attempt 466 00:29:03,960 --> 00:29:06,840 Speaker 1: by Democrats to spike this nomination so they won't have 467 00:29:06,960 --> 00:29:09,080 Speaker 1: enough time to get a new nominee named, and then 468 00:29:09,120 --> 00:29:11,200 Speaker 1: the Democrats hope they can take the Senate and eventually 469 00:29:11,200 --> 00:29:14,240 Speaker 1: the White House. I want to interrupt because it's extraordinary image, 470 00:29:14,520 --> 00:29:17,240 Speaker 1: Shannon to see on the other networks. Of course, everybody 471 00:29:17,240 --> 00:29:19,920 Speaker 1: in our studios and we've got like ten fifteen screens 472 00:29:20,000 --> 00:29:22,440 Speaker 1: up here and PIM you know, they're all covering it. 473 00:29:22,520 --> 00:29:25,200 Speaker 1: But CNN has got their foot in the elevator door. 474 00:29:25,880 --> 00:29:29,560 Speaker 1: Is Senator Flake is trying to get down to Judiciary. 475 00:29:29,680 --> 00:29:31,880 Speaker 1: I would suggest Shannon petty piece would have been more 476 00:29:31,920 --> 00:29:34,520 Speaker 1: polite than that and not stuck her foot in the 477 00:29:34,560 --> 00:29:37,320 Speaker 1: elevator door. He's trying to get the door shut now 478 00:29:37,840 --> 00:29:41,480 Speaker 1: and no security coming to put a pen, put a 479 00:29:41,520 --> 00:29:45,720 Speaker 1: bit pen. Shannon's done this before confident in elevator sensors. 480 00:29:45,800 --> 00:29:48,320 Speaker 1: So yeah, I don't have a lot of trust industry. 481 00:29:48,440 --> 00:29:50,640 Speaker 1: I can tell you, Shannon that the Senator from Arizona 482 00:29:51,040 --> 00:29:54,360 Speaker 1: is on his way down to the committee right now. Pim. 483 00:29:54,520 --> 00:29:57,720 Speaker 1: But Shannon, the reason I asked or asked the question 484 00:29:57,720 --> 00:30:00,360 Speaker 1: having to do with Senator Flake and and Merrick Land 485 00:30:00,560 --> 00:30:03,400 Speaker 1: is in watching all of this and not to diminish 486 00:30:03,520 --> 00:30:07,920 Speaker 1: any of the testimony. Is this just pure politics that 487 00:30:08,080 --> 00:30:12,680 Speaker 1: the Democrats experienced what they did with Marrek Garland and 488 00:30:12,720 --> 00:30:15,200 Speaker 1: now they're trying to do the same thing with Brett 489 00:30:15,600 --> 00:30:19,160 Speaker 1: Kavanaugh in any way, shape or form. Well, I don't think, 490 00:30:19,680 --> 00:30:22,640 Speaker 1: I mean, I don't think what the their protestations to 491 00:30:22,760 --> 00:30:25,000 Speaker 1: Kavanaugh are just because of what happened to Merrick Garland. 492 00:30:25,000 --> 00:30:29,040 Speaker 1: Because Neil gorsch Um went through pretty smoothly. It was 493 00:30:29,080 --> 00:30:32,240 Speaker 1: sixty something days he went through. There was a little 494 00:30:32,240 --> 00:30:34,640 Speaker 1: bit of controversy that the Democrats pulled out at the end, 495 00:30:34,680 --> 00:30:38,960 Speaker 1: but nothing that stopped the nomination. Um They obviously, um, 496 00:30:39,480 --> 00:30:43,000 Speaker 1: you know, we're not aligned ideologically with Gorst but he 497 00:30:43,040 --> 00:30:47,160 Speaker 1: made through, and Kavanaugh was really marching toward a very 498 00:30:47,160 --> 00:30:50,800 Speaker 1: smooth confirmation. I mean, it was I mean, there was 499 00:30:51,000 --> 00:30:56,360 Speaker 1: no drama until this revelation was leaked to the press 500 00:30:56,400 --> 00:30:59,440 Speaker 1: and then eventually was made public, So I mean, I 501 00:30:59,480 --> 00:31:03,360 Speaker 1: know know the Democrats have obviously from the beginning of 502 00:31:03,520 --> 00:31:06,280 Speaker 1: Kavanaugh really wanted to fight, really wanted to stop this domination, 503 00:31:06,320 --> 00:31:07,760 Speaker 1: but it didn't look like they would be able to 504 00:31:07,880 --> 00:31:11,320 Speaker 1: until the very last revelationship I Rich Truman says that 505 00:31:11,600 --> 00:31:14,040 Speaker 1: we believe in the reporting that Mr Flake at the 506 00:31:14,040 --> 00:31:17,360 Speaker 1: elevator was held up by a protester, not the Pruss 507 00:31:17,360 --> 00:31:26,160 Speaker 1: Shannon Petty piece. Our White House corresponded. Thanks for listening 508 00:31:26,200 --> 00:31:30,760 Speaker 1: to the Bloomberg Surveillance podcast. Subscribe and listen to interviews 509 00:31:30,760 --> 00:31:36,000 Speaker 1: on Apple Podcasts, SoundCloud, or whichever podcast platform you prefer. 510 00:31:36,560 --> 00:31:39,920 Speaker 1: I'm on Twitter at Tom Keane before the podcast. You 511 00:31:39,920 --> 00:31:43,360 Speaker 1: can always catch us worldwide. I'm Bloomberg Radio.