WEBVTT - Miami, Taking Wall Street From NYC Won't Be Easy 0:00:00.120 --> 0:00:02.400 Hey, it's Carol and Tim and we have something new 0:00:02.440 --> 0:00:03.280 and exciting for you. 0:00:03.560 --> 0:00:06.360 Everything you love about Bloomberg Radio is now in your car. 0:00:06.519 --> 0:00:09.640 The new Bloomberg Business App now featuring Apple CarPlay and 0:00:09.640 --> 0:00:10.320 Android Auto. 0:00:10.440 --> 0:00:13.960 Listen to your favorite Bloomberg Radio stations anytime. 0:00:13.480 --> 0:00:16.960 Plus every Bloomberg podcast, the latest news, and more, all 0:00:17.079 --> 0:00:18.120 at the click of a button. 0:00:18.280 --> 0:00:21.240 It's free and simple to use. Just download the Bloomberg 0:00:21.239 --> 0:00:23.680 Business App on your smartphone and connect your phone to 0:00:23.720 --> 0:00:24.200 your car. 0:00:24.400 --> 0:00:27.360 The Bloomberg Business App now with Apple CarPlay and Android 0:00:27.360 --> 0:00:30.200 Auto features. Download it free in the Apple App Store 0:00:30.320 --> 0:00:31.400 or on Google Play. 0:00:31.480 --> 0:00:34.600 Presented by our sponsor, Interactive Brokers. 0:00:35.680 --> 0:00:40.040 This is Bloomberg Business Week inside from the reporters and 0:00:40.200 --> 0:00:43.800 editors who bring you America's most trusted business magazine, plus 0:00:43.840 --> 0:00:47.760 gloom O Business finance and tech news. The Bloomberg Business 0:00:47.760 --> 0:00:52.960 Week Podcast with Carol Messer and Tim Stenebeck from Bloomberg Radio. 0:00:54.800 --> 0:00:57.360 Fascinating one. 0:00:57.480 --> 0:00:59.520 If you sit at waked, I'm. 0:00:59.280 --> 0:01:00.800 Going when to Miami. 0:01:01.560 --> 0:01:06.960 Welcome to my body, and I don't if he stood 0:01:06.959 --> 0:01:10.480 a break it down, Welcome to. 0:01:11.319 --> 0:01:12.200 Me to Miami. 0:01:12.360 --> 0:01:16.720 That is uh, what Ken Griffin is like is likely 0:01:16.760 --> 0:01:19.080 to say to everyone out there. Ken Griffin, of course, 0:01:19.120 --> 0:01:21.800 a hedge fund billionaire. He was speaking with Arshenali Bask 0:01:21.840 --> 0:01:25.040 at the Citadel Securities Global Macro Conference in Miami. 0:01:25.080 --> 0:01:26.680 Take a listen to what he said. 0:01:28.000 --> 0:01:32.800 New York is the financial capital of America today and 0:01:32.840 --> 0:01:36.720 it's New York's to lose. Having said that, Miami I 0:01:36.720 --> 0:01:38.440 think represents the future of America. 0:01:40.360 --> 0:01:43.160 So he's referring to Wall Street, South Bailey, the idea 0:01:43.200 --> 0:01:46.440 that South Florida's the up and coming financial center. Uh, 0:01:46.720 --> 0:01:49.360 they've been promoting this idea for years. It's definitely gained 0:01:49.360 --> 0:01:51.200 some traction since the pandemic. 0:01:51.360 --> 0:01:54.120 Yeah, we saw a lot of people wanting more tax 0:01:54.200 --> 0:01:57.200 friendly states. Obviously, it's easy to talk your book when 0:01:57.240 --> 0:01:59.520 you're someone who's made the move down there. So it 0:01:59.560 --> 0:02:01.920 does out and interesting that he said it's where the 0:02:01.960 --> 0:02:04.280 future is and they're trying to court more and more. 0:02:04.280 --> 0:02:06.160 I know a number of traders that did move down 0:02:06.440 --> 0:02:09.360 and so far I haven't complained, but I tell them often. 0:02:09.520 --> 0:02:10.640 Let's talk more in August. 0:02:10.800 --> 0:02:12.960 All right, Well, let's bring in Jonathan Levin. He is 0:02:13.080 --> 0:02:16.000 a market's columnist for Bloomberg Opinion. He is based in 0:02:16.000 --> 0:02:19.480 Miami and Jonathan you've lived in Miami for a while, 0:02:19.520 --> 0:02:21.600 have you talked to the finance guys who've made their 0:02:21.639 --> 0:02:22.200 way down. 0:02:22.240 --> 0:02:23.000 What are they saying? 0:02:24.720 --> 0:02:24.960 Yeah? 0:02:24.960 --> 0:02:28.919 Absolutely? I mean, look, first, starters, if you're coming from 0:02:29.000 --> 0:02:32.760 New York City, you get here and you immediately say, hey, 0:02:32.800 --> 0:02:34.360 this is a pretty good deal. 0:02:34.600 --> 0:02:34.760 Right. 0:02:34.840 --> 0:02:37.560 I don't have to deal with Northeast winters for starters, 0:02:39.360 --> 0:02:42.760 I'm not paying a state income tax. And while Miami 0:02:42.840 --> 0:02:46.560 has gotten to be a pretty pricey place, especially recently, 0:02:47.400 --> 0:02:49.960 it's still less expensive, let's face it, than you know, 0:02:50.080 --> 0:02:53.320 trying to live in Manhattan or even San Francisco. Right, 0:02:53.400 --> 0:02:57.000 So you get here and you get this sense of 0:02:57.120 --> 0:03:01.840 like euphoria for the first of months, maybe even the 0:03:01.840 --> 0:03:03.560 first few years that people get here. 0:03:04.560 --> 0:03:06.720 Yeah, and I'm more interested in kind of what those 0:03:06.720 --> 0:03:09.440 steps look like though, for it to look more like 0:03:09.680 --> 0:03:12.560 in New York and actually be this future hub that 0:03:12.680 --> 0:03:15.000 Ken Griffin and many others enjoy talking about. 0:03:16.400 --> 0:03:16.720 Sure. 0:03:16.760 --> 0:03:22.359 Absolutely. So put in my column today is that, you know, 0:03:22.520 --> 0:03:25.040 Miami really needs to develop into a more mature place 0:03:25.160 --> 0:03:28.560 if it is going to really compete with these major 0:03:28.600 --> 0:03:33.160 financial centers. Right, So, for starters, we are a car town. 0:03:34.520 --> 0:03:37.760 You can't get anywhere without a car. In South Florida, 0:03:37.840 --> 0:03:41.920 we do not really have a viable public transit system. 0:03:42.400 --> 0:03:46.160 It's nothing like New York in that regard. Right, So, 0:03:46.560 --> 0:03:50.320 you know, forty years ago they put up this metro rail. 0:03:51.560 --> 0:03:54.800 It basically only works for like three or four percent 0:03:54.840 --> 0:03:59.440 of the population. It's just not a very comprehensive public 0:03:59.480 --> 0:04:02.520 transit system. And so, you know, one of my big 0:04:04.240 --> 0:04:08.119 recommendations in my column today is if you really want 0:04:08.160 --> 0:04:11.400 to compete and have a future as Wall Streets South, 0:04:11.640 --> 0:04:13.760 you have to do something about that. You have to 0:04:13.800 --> 0:04:17.040 do something about this traffic that is just getting worse 0:04:17.279 --> 0:04:21.360 and worse. And you know, it's a huge undertaking to say, 0:04:22.240 --> 0:04:24.359 you know, let's go out there and build this massive 0:04:24.400 --> 0:04:26.800 new rail system. I don't think that that's practical. I 0:04:26.800 --> 0:04:30.040 don't think that that's going to happen. But as development 0:04:30.279 --> 0:04:32.960 officials look at the future, they have to be looking 0:04:33.000 --> 0:04:36.880 at creating more walkable neighborhoods going forward, and maybe even 0:04:37.080 --> 0:04:39.880 you know, doing something with Miami's water you know, where 0:04:39.880 --> 0:04:42.839 are the furry is, where are the water taxis? Anything 0:04:43.080 --> 0:04:44.880 to get people out of those cars. 0:04:45.240 --> 0:04:47.120 I love that idea, and that would make it really 0:04:47.120 --> 0:04:52.120 picturesque and just give it a new character. Speaking of water, Jonathan, 0:04:52.240 --> 0:04:55.159 the area is highly prone to flooding, and of course 0:04:55.200 --> 0:04:58.000 it's in a hurricane zone as well. So climate resiliency 0:04:58.440 --> 0:05:01.280 is obviously a really big issue. You from what you've 0:05:01.320 --> 0:05:05.119 seen as South Florida's local governments doing enough what words 0:05:05.120 --> 0:05:05.960 should they be doing? 0:05:07.440 --> 0:05:10.800 Yeah, it's huge. I mean, if you talk about really 0:05:10.839 --> 0:05:15.400 bringing in serious, serious businesses like another Citadel, you have 0:05:15.440 --> 0:05:17.960 to give them the confidence that you know, if they're 0:05:18.000 --> 0:05:21.120 investing for the future, their their investments are going to 0:05:21.160 --> 0:05:25.200 pay off over decades and nobody wants to think about 0:05:25.200 --> 0:05:28.560 the possibility that the lobby of their beautiful new building 0:05:28.640 --> 0:05:30.680 is going to be flooding on a regular basis. 0:05:30.800 --> 0:05:30.960 Right. 0:05:31.600 --> 0:05:35.800 So, I've seen some of these governments making the right overtures. 0:05:35.920 --> 0:05:41.160 You know, City of Miami did a big climate resiliency 0:05:41.800 --> 0:05:46.120 bond some time ago. They're making sort of investments and 0:05:46.720 --> 0:05:49.800 pumps and these sorts of things. The point I make 0:05:50.000 --> 0:05:52.360 is you've just got to do more and more of it. 0:05:52.680 --> 0:05:56.200 Investing for the long term is really about elevate, elevate, 0:05:56.360 --> 0:06:00.360 elevate with that infrastructure, and on the private side also 0:06:00.440 --> 0:06:03.159 got to be out there and putting in the most 0:06:03.400 --> 0:06:08.479 rigorous codes possible, so that private businesses and private homes 0:06:08.720 --> 0:06:13.039 are essentially turning themselves into bunkers for the future climate 0:06:13.120 --> 0:06:16.440 challenges that sort of inevitably this region is going to face. 0:06:17.120 --> 0:06:19.080 And one of the things I'm reminded of a story 0:06:19.080 --> 0:06:22.400 back in September about the cost to ensure homes is 0:06:22.440 --> 0:06:25.400 that something Jonathan that comes up and is being considered 0:06:25.440 --> 0:06:28.160 just given the cost of living can be cheaper in 0:06:28.160 --> 0:06:31.920 some regards, but if you're spending much higher premium to 0:06:32.000 --> 0:06:34.719 ensure your house or your car, does that balance out? 0:06:36.320 --> 0:06:39.719 Yeah, I think that's absolutely a huge, a huge point. 0:06:39.880 --> 0:06:43.200 I mean, look, the past few years have been especially 0:06:43.279 --> 0:06:49.360 especially bad for the property insurance segment here in South Florida, 0:06:49.400 --> 0:06:51.960 and I think it's a confluence of factors. It is 0:06:52.080 --> 0:06:58.000 absolutely partially about the climate challenges that this region is facing. 0:06:58.120 --> 0:07:01.880 On top of that, we have a runaway litigation issue 0:07:01.520 --> 0:07:05.080 in the state of Florida. There have been some reforms 0:07:05.120 --> 0:07:08.599 that have tried to tackle that, and you know, let's 0:07:08.600 --> 0:07:13.200 face it, I think that the dynamics in fixed income 0:07:13.320 --> 0:07:19.680 markets have also played into the price the price hikes 0:07:19.800 --> 0:07:24.960 that we've seen trickle down to property insurance rates. So 0:07:25.000 --> 0:07:28.920 The bottom line is property insurance inflation has been through 0:07:28.960 --> 0:07:31.920 the roof here in the state of Florida, and it 0:07:32.040 --> 0:07:35.800 absolutely it makes it harder both for those Wall Street 0:07:35.840 --> 0:07:40.960 South migrants, but it makes it harder to for workers 0:07:41.000 --> 0:07:45.120 who are sort of Wall Street South adjacent. Right, So 0:07:45.600 --> 0:07:47.920 if I if I could just pivot to sort of 0:07:47.960 --> 0:07:51.960 what the third pillar of where Florida needs to see 0:07:52.400 --> 0:07:57.240 improvement to keep its momentum going, it's really education and 0:07:57.360 --> 0:08:01.320 that all comes down to drawing the best teachers to 0:08:01.400 --> 0:08:05.080 the region. Whether it's for private schools or public schools. 0:08:05.320 --> 0:08:07.400 You need to bring in more and more teachers. We 0:08:07.600 --> 0:08:11.880 don't have great student teacher ratios here and you're not 0:08:12.000 --> 0:08:15.320 going to bring in more great teachers if people can't 0:08:15.320 --> 0:08:19.320 afford to live here because there is both housing inflation 0:08:19.760 --> 0:08:23.520 and insurance inflation. And by the way, as I started with, 0:08:24.000 --> 0:08:27.480 not great public transit options for those people who choose 0:08:27.520 --> 0:08:30.400 to live out in those suburbs and excerbs, so very 0:08:30.440 --> 0:08:34.839 difficult cocktail of factors here. 0:08:35.080 --> 0:08:35.680 Absolutely. 0:08:35.679 --> 0:08:37.200 I mean, if you want to keep the talent, you 0:08:37.280 --> 0:08:39.960 have to make it easy for the talent to bring 0:08:40.000 --> 0:08:43.160 over their entire families to uproot them from the Northeast, 0:08:43.200 --> 0:08:46.520 where there's no shortage of high priced private schools that 0:08:47.360 --> 0:08:49.280 have a short list of getting into the Harvards and 0:08:49.320 --> 0:08:52.640 the Yales. You had something really interesting in your column 0:08:52.640 --> 0:08:56.840 that looked at the private schools and how many of 0:08:56.880 --> 0:09:00.959 them have good SAT scores in the Miami area versus 0:09:01.000 --> 0:09:03.560 New York, and the contrast is stunning. 0:09:05.120 --> 0:09:08.800 Yeah. Absolutely, I mean I think the story is, you know, 0:09:09.120 --> 0:09:12.640 I live down here. I try to defend the area, 0:09:12.760 --> 0:09:15.319 and I think there are a lot of very good 0:09:15.920 --> 0:09:19.520 private and public schools down here. But the truth of 0:09:19.559 --> 0:09:23.400 the matter is there aren't a ton of great schools. 0:09:23.840 --> 0:09:27.960 And the way you know, we measured great high schools 0:09:27.960 --> 0:09:31.880 with the help of this consulting firm, Webster Pacific, is like, 0:09:31.920 --> 0:09:36.439 how many of them produce average SAT scores above fourteen hundred. 0:09:36.720 --> 0:09:40.719 The answer very quickly is two. Right, So you can 0:09:40.760 --> 0:09:44.280 imagine if you have a big flood of folks coming 0:09:44.320 --> 0:09:47.600 in and they're managing directors, they're top folks at hedge funds, 0:09:47.840 --> 0:09:51.280 they all want to get their kids into these two schools. 0:09:51.640 --> 0:09:54.840 And those two schools, you know, Pine Crest and Ransom 0:09:54.840 --> 0:09:57.800 Efvert Blades, for what it's worth, they can only expand, 0:09:57.960 --> 0:10:01.320 so fast. You know, you understand where they're coming from. 0:10:01.320 --> 0:10:05.720 They don't want to expand so fast that they risk 0:10:05.800 --> 0:10:11.640 their reputation, that they risk the quality of the education. 0:10:12.120 --> 0:10:16.920 And also expanding means acquiring more real estate. We've talked 0:10:16.960 --> 0:10:20.959 about why and how that's difficult in a place like this, 0:10:21.280 --> 0:10:25.040 so again, just you know, very challenging. If you're up 0:10:25.080 --> 0:10:29.360 in Manhattan, you feel like you have dozens of options, 0:10:29.679 --> 0:10:32.240 or at least a couple dozen of very very elite 0:10:32.360 --> 0:10:36.880 private schools. Here, the options are few and far between, 0:10:37.160 --> 0:10:40.840 and by the way, one of them is probably as 0:10:40.920 --> 0:10:43.880 much as an hour or more from downtown Miami. So 0:10:44.400 --> 0:10:46.760 you know, good luck with that commune exactly. 0:10:47.120 --> 0:10:49.600 Jonathan Llvin, thank you so much for joining us. Johnathan 0:10:49.640 --> 0:10:52.960 Ullivan is a Bloomberg opinion columnist joining us from Miami 0:10:53.360 --> 0:10:55.679 and Baillie. We were talking earlier about how we may 0:10:55.679 --> 0:10:58.640 not necessarily be Florida fans, but these are issues that 0:10:58.880 --> 0:11:02.679 folks of the finance industry think about constantly. Education, transportation, 0:11:02.760 --> 0:11:04.280 and ease of transit especially. 0:11:04.400 --> 0:11:06.360 Yeah, I'm not an IVY League grad, but I do 0:11:06.520 --> 0:11:09.480 know that IVY League grads prefer to get their kids 0:11:09.520 --> 0:11:12.200 set up to go to an IVY League, and as 0:11:12.360 --> 0:11:15.960 Jonathan mentioned, that's one of those key factors for drawing 0:11:16.000 --> 0:11:17.120 the true elites down there. 0:11:17.160 --> 0:11:19.960 All right, Well, South Florida still has its boosters, and 0:11:20.000 --> 0:11:22.240 of course there is plenty of money moving down there, 0:11:22.320 --> 0:11:25.440 just it continues to be a challenge for those who 0:11:25.520 --> 0:11:26.920 are considering making the move. 0:11:30.360 --> 0:11:33.920 You're listening to the Bloomberg Business Week podcast. Catch us 0:11:33.960 --> 0:11:37.320 live weekday afternoons from three to six Eastern Listen on 0:11:37.360 --> 0:11:41.400 Bloomberg dot com, the iHeartRadio app, and the Bloomberg Business App, 0:11:41.679 --> 0:11:43.400 or watch us live on YouTube. 0:11:44.760 --> 0:11:46.880 Dally, did you know that we had APEC this week? 0:11:47.280 --> 0:11:49.720 I think I heard that I did see Janet Yellen 0:11:49.800 --> 0:11:51.720 at an in and out according to Twitter. 0:11:51.800 --> 0:11:53.760 I'm or X. I guess I'm really interested what her 0:11:53.840 --> 0:11:54.240 order was? 0:11:54.559 --> 0:11:56.239 Someone posted this on x Someone. 0:11:56.000 --> 0:11:58.600 Posted a photo of Janet Yellen ordering in and out. 0:11:58.720 --> 0:12:01.320 Actually, that's really good. I gotta go find that one. 0:12:02.040 --> 0:12:03.800 We want to bring in someone who knows quite a 0:12:03.840 --> 0:12:07.200 bit about APEC, and of course is a longtime China watcher. 0:12:07.280 --> 0:12:10.600 He is Andy Brown, a partner at Brunswick Group. He 0:12:10.600 --> 0:12:13.240 heads up Brunswick's China Hub, which means he works closely 0:12:13.280 --> 0:12:16.880 with his colleagues in China and globally to lead up 0:12:16.880 --> 0:12:20.320 the firm's geopolitical practice to advise clients on China related issues. 0:12:20.600 --> 0:12:21.640 And he's going to help us. 0:12:21.559 --> 0:12:24.920 Recap what happened at APEC because Andy, you had the 0:12:25.000 --> 0:12:29.920 long anticipated, high stakes summit meeting between President Biden and 0:12:29.960 --> 0:12:33.240 President Chijinping, and it did yield some big wins. Right, 0:12:33.280 --> 0:12:36.679 there's going to be military to military communications, there's going 0:12:36.720 --> 0:12:39.840 to be pandas right exactly. 0:12:39.320 --> 0:12:43.720 Some people have called APEX a meeting that occurred on 0:12:43.800 --> 0:12:48.680 the sidelines of the summit, and I think there's quite 0:12:48.679 --> 0:12:51.120 a bit of truth to that. Yeah, Look, it was 0:12:51.160 --> 0:12:56.240 a successful meeting as far as I can tell. It 0:12:56.400 --> 0:12:59.840 was successful because it happened. 0:13:01.240 --> 0:13:02.840 Yeah, and they agreed to talk. 0:13:03.160 --> 0:13:05.719 They agreed to talk. It was successful against a very 0:13:05.840 --> 0:13:11.319 low base of expectation. It was successful because nothing terrible happened, 0:13:11.760 --> 0:13:15.679 if you don't count Joe Biden yet again calling Si 0:13:15.800 --> 0:13:22.160 Jinping a dictator, yeah, and Anthony blinking looking terribly pained 0:13:22.240 --> 0:13:26.559 at the reference. But look, I think it was successful 0:13:26.640 --> 0:13:31.400 because it just seems so normal. You know, you had 0:13:31.400 --> 0:13:35.120 two leaders and they sat down and they across a table, 0:13:35.160 --> 0:13:37.280 and they were flanked by their aids, and they had 0:13:37.280 --> 0:13:40.199 a substantial conversation and a nice walk in the garden, 0:13:40.360 --> 0:13:46.480 and Si Jinping met a bunch of CEOs and as normal, 0:13:46.640 --> 0:13:49.200 they sort of sucked up to him and getting a 0:13:49.280 --> 0:13:54.160 round of a standing ovation and Sijmpin cracked a smile, 0:13:54.720 --> 0:13:59.160 actually a big grin when Gavin Newsom handed him a 0:13:59.240 --> 0:14:04.320 Golden State Warriors. Well, that's no, that's not normal. That's 0:14:04.320 --> 0:14:07.960 that's not normal. That's beyond that's beyond normal. And and look, 0:14:07.960 --> 0:14:09.839 you know you've got to you've got to measure that 0:14:10.040 --> 0:14:13.200 against the beginning of this year, when and when it 0:14:13.240 --> 0:14:17.240 was anything but normal, when it was extremely abnormal. 0:14:17.760 --> 0:14:17.880 Uh. 0:14:18.000 --> 0:14:21.120 And in fact, earlier this year people were talking about war. 0:14:22.240 --> 0:14:23.840 Well, we see we have two wars going on and 0:14:23.920 --> 0:14:26.720 the uncertainty around that. But I'm wondering what the messaging 0:14:26.920 --> 0:14:29.960 from this summit could mean for investors wanting to get 0:14:30.000 --> 0:14:32.400 back into China, because we saw Ali Baba pulling back 0:14:32.440 --> 0:14:35.680 their plan to separate their cloud unit because of the 0:14:35.800 --> 0:14:39.640 restrictions from the US shipping AI or chips to China. 0:14:40.480 --> 0:14:43.080 Yeah, I don't actually think that that that was the 0:14:43.160 --> 0:14:46.560 point of the meeting was to get anything substantial. Frankly, 0:14:46.640 --> 0:14:49.600 on anything. The point of this meeting was just to 0:14:49.640 --> 0:14:54.440 get these two sides together again, and there has been 0:14:54.520 --> 0:14:59.360 a dangerous absence of dialogue even as military tensions build, 0:15:00.000 --> 0:15:03.280 even as you have war in Ukraine, you have war 0:15:03.360 --> 0:15:07.480 in Gaza, and you have all kinds of tripwise flash 0:15:07.520 --> 0:15:13.200 points around Asia, Chinese Filipino ships standing off in the 0:15:13.280 --> 0:15:17.840 South China Sea. It's important that these two leaders get together. 0:15:18.840 --> 0:15:21.920 And frankly, I thought one of the more important agreements 0:15:22.280 --> 0:15:24.960 we had an agreement for military military to resume military 0:15:25.000 --> 0:15:28.080 military exchanges. We had an agreement on fentanyl. I thought 0:15:28.120 --> 0:15:30.560 maybe one of the most important was agreement to get 0:15:30.600 --> 0:15:34.240 more flights going before between the United States and China. 0:15:34.320 --> 0:15:37.000 You've got to remember, in all the sort of myriad 0:15:37.040 --> 0:15:40.720 ways that Chinese and Americans have met over the years, 0:15:40.760 --> 0:15:44.560 whether that's in conference rooms or in sports stadiums or 0:15:44.560 --> 0:15:48.720 hotels or airplanes, all of that, all of that has 0:15:48.760 --> 0:15:54.080 been frozen and in a world that is becoming incredibly tense. 0:15:54.720 --> 0:15:56.840 So things really took a turn for the worse when 0:15:57.160 --> 0:15:59.920 former House Speaker Nancy Pelosi made a trip to Thai 0:16:00.120 --> 0:16:04.040 One basically sticking a finger in Beijing's eye. Have all 0:16:04.080 --> 0:16:06.800 the different measures that have been piled on been rolled 0:16:06.840 --> 0:16:07.920 back following. 0:16:07.600 --> 0:16:11.360 That, no well talking so so, first of all, in 0:16:11.400 --> 0:16:13.840 the aftermath of that was the August August visit, and 0:16:13.840 --> 0:16:17.800 then you had China firing ballistic missiles over Taiwans halted 0:16:18.280 --> 0:16:23.200 all negotiations, all talks about about anything. We haven't wound back. 0:16:23.840 --> 0:16:26.440 I mean, we're not going back to where we were before. 0:16:27.360 --> 0:16:33.280 The US position is, basically, this is a fundamentally competitive relationship, 0:16:34.320 --> 0:16:36.560 but we've got to make it work, frenemies. We got 0:16:36.560 --> 0:16:39.080 to make it work because we've got a big trade relationship, 0:16:39.120 --> 0:16:42.240 investment relationship, and we've got a lot of people to 0:16:42.320 --> 0:16:46.080 people contact, and we have a lot of problems in 0:16:46.120 --> 0:16:51.400 the world that needs solving, not least climate change, pandemics, narcotics, 0:16:51.440 --> 0:16:55.400 trafficking and so on. That's the That's the US position, 0:16:55.480 --> 0:16:57.440 and it seems to me to be a pretty sensible 0:16:57.480 --> 0:17:00.640 one that acknowledges the tensions and the relationship, that says 0:17:00.680 --> 0:17:02.479 we've got to manage them somehow. 0:17:02.880 --> 0:17:06.440 We're talking Andy Brown, partner at Brunswick Group, former editorial 0:17:06.480 --> 0:17:09.800 director of the Bloomberg New Economic Forum. 0:17:09.920 --> 0:17:12.000 So glad to have you back in studio. 0:17:12.040 --> 0:17:13.920 But Andy, one thing that's come up on a couple 0:17:13.960 --> 0:17:17.560 of conversations I've had, is that they view some investors 0:17:17.720 --> 0:17:23.080 view the current geopolitical landscape as the most uncertain since 0:17:23.119 --> 0:17:25.520 the aftermath of two thousand and one, eris aftermath of 0:17:25.600 --> 0:17:28.800 nine to eleven, Given everything going on in Gaza, in Ukraine, 0:17:28.880 --> 0:17:32.320 uncertainty around China and Taiwan. What do you make of 0:17:32.359 --> 0:17:36.680 that potential argument? And did this summit have any impact 0:17:36.720 --> 0:17:37.400 on your view? 0:17:38.119 --> 0:17:42.320 Well, to the extent that geopolitics drives business today, and 0:17:42.359 --> 0:17:45.520 it really does. The fact that you've had this sort 0:17:45.560 --> 0:17:49.080 of time out, the fact that you have two presidents 0:17:49.080 --> 0:17:53.560 who are now tolking has at least cleared some of 0:17:53.600 --> 0:17:58.480 the uncertainty. So earlier this year, ceo as were worried 0:17:58.520 --> 0:18:03.200 about worst caseos. Right, So you had boardrooms looking at 0:18:03.320 --> 0:18:07.160 trying to weigh the probability of a Chinese invasion of Taiwan. 0:18:08.520 --> 0:18:11.760 You know, you had senior Pentagon figures coming out to say, yep, 0:18:11.880 --> 0:18:14.159 you know we can see inside Tajen things. Mind he's 0:18:14.200 --> 0:18:16.880 going to go in Before twenty twenty seven. You had 0:18:16.880 --> 0:18:19.359 the head of the Navy saying it could be twenty 0:18:19.359 --> 0:18:21.680 twenty four. In fact, it could be any time at all, 0:18:22.280 --> 0:18:24.440 and so this has been this has been a big 0:18:24.480 --> 0:18:30.240 deterrent to long term investment in China, the geopolitics of Taiwan, 0:18:30.320 --> 0:18:33.040 the geopolitics of the South China Sea, on top of 0:18:33.720 --> 0:18:37.960 a lot of very hostile regulation in China around data, 0:18:38.400 --> 0:18:42.960 around national security, anti espionage. You had Chinese police raids 0:18:43.080 --> 0:18:46.800 on the Mints group, on Bain and so on and 0:18:47.000 --> 0:18:50.840 all together you wrap it all up, and CEOs have 0:18:51.000 --> 0:18:55.719 been concerned frankly about their personal safety in China, issues 0:18:55.760 --> 0:18:58.480 about whether they should go or not, and if they go, 0:18:58.640 --> 0:19:01.200 should they wipe their laptop? Yes, we'll leave them at home. 0:19:01.240 --> 0:19:04.359 Even better, I got to ask you, since you bring 0:19:04.480 --> 0:19:06.719 up Taiwan and how big of an issue it is. 0:19:06.960 --> 0:19:10.560 The opposition parties in Taiwan have agreed to join forces 0:19:11.200 --> 0:19:15.000 ahead of the critical presidential election next year. That increases 0:19:15.000 --> 0:19:17.160 the odds slightly that you might get a more pro 0:19:17.400 --> 0:19:21.719 China government in Taiwan elected next year. What does that 0:19:21.760 --> 0:19:23.840 do to any kind of timeline that people are putting 0:19:23.840 --> 0:19:27.720 out there about a possible Chinese attempt to unify with Taiwan. 0:19:28.040 --> 0:19:31.920 Right, so, these timelines were all extremely speculative to start with. 0:19:31.960 --> 0:19:34.080 I mean, really, the only date we have is that 0:19:34.400 --> 0:19:37.760 cjmping has told the People's Liberation Army it should be 0:19:37.840 --> 0:19:42.280 ready by twenty twenty seven. So actually I think this 0:19:42.359 --> 0:19:45.399 is a big deal. It wasn't so long ago that 0:19:45.440 --> 0:19:49.119 William Laie of the ruling Democratic Progressive Party was a 0:19:49.160 --> 0:19:52.159 shoe in, all right, and he has a history of 0:19:53.640 --> 0:19:58.720 fairly strong support for a provide and its position. And 0:19:58.760 --> 0:20:03.960 now you have the opposition agreeing to unite behind a 0:20:04.000 --> 0:20:07.480 single ticket and they will have a series of internal 0:20:07.520 --> 0:20:10.520 external polls to see who that should be, all broken 0:20:10.560 --> 0:20:15.480 by former President maying two and China would Now I 0:20:15.520 --> 0:20:18.280 don't know whether that how to what extent that change 0:20:18.280 --> 0:20:20.400 of the game, but it certainly does make the likelihood 0:20:20.400 --> 0:20:22.199 of a William Lyve presidency. 0:20:21.720 --> 0:20:23.919 So much less and that would be good news for 0:20:23.920 --> 0:20:27.840 anyone looking for come in the South China. See Andy Brown, 0:20:27.880 --> 0:20:30.159 really appreciate your joining us. Andy Brown as partner with 0:20:30.240 --> 0:20:33.359 the Brunswick Group, former editorial director of the Bloomberg New 0:20:33.400 --> 0:20:34.520 Economy Forum. 0:20:34.560 --> 0:20:35.280 This is Bloomberg. 0:20:36.480 --> 0:20:40.040 You're listening to the Bloomberg Business Week Podcast. Catch us 0:20:40.080 --> 0:20:44.119 live weekday afternoons from three to six Easter on Bloomberg Radio, 0:20:44.320 --> 0:20:47.600 The Bloomberg Business app and YouTube. You can also listen 0:20:47.680 --> 0:20:50.800 live on Amazon Alexa from our flagship New York station. 0:20:51.240 --> 0:20:54.360 Just say Alexa play Bloomberg eleven thirty. 0:20:55.840 --> 0:20:56.159 Billy. 0:20:56.359 --> 0:20:58.760 You and I were talking earlier about Joe Biden and she, 0:20:58.840 --> 0:20:59.840 Jim Hingk's meeting and St. 0:21:00.000 --> 0:21:00.480 Francisco. 0:21:00.600 --> 0:21:03.359 For all that it accomplished or didn't accomplish, there was 0:21:03.440 --> 0:21:07.119 one small victory, which is the likely return of panda. 0:21:06.720 --> 0:21:08.440 Bears to US zoo's. 0:21:08.920 --> 0:21:11.639 Earlier this month, the three panda bears at Washington, DC's 0:21:11.720 --> 0:21:14.399 National Zoo were returned to China following the expiration of 0:21:14.400 --> 0:21:18.280 a three year contract with the China's Wildlife Agency. So 0:21:18.320 --> 0:21:20.399 we want to bring in now Elena Songster. She is 0:21:20.400 --> 0:21:23.040 a professor at Saint Mary's College of California. She is 0:21:23.119 --> 0:21:26.560 author of Panda Nation, which is a book about China's 0:21:26.760 --> 0:21:30.040 panda policy. Elena, good to speak with you. I am 0:21:30.119 --> 0:21:33.399 obsessed with panda bears because they're like giant children, but 0:21:33.480 --> 0:21:36.199 also because Beijing has long used these creatures as a 0:21:36.200 --> 0:21:41.680 way to curry favor, reward friends, and punish their enemies. 0:21:42.040 --> 0:21:45.280 What can you tell us about the significance of pandas 0:21:45.680 --> 0:21:47.600 to China? 0:21:48.040 --> 0:21:51.000 So pandas are unique to China. They cannot be found 0:21:51.040 --> 0:21:56.640 anywhere else. And one thing that I find particularly interesting 0:21:56.640 --> 0:21:59.240 that I discovered in my research about pandas is that 0:22:00.080 --> 0:22:03.760 they are not connected with any of the more ancient 0:22:04.200 --> 0:22:09.800 kind of historical cultural symbolism, and so they're really only 0:22:09.880 --> 0:22:13.200 become significant culturally for China in the twentieth century. 0:22:14.400 --> 0:22:18.240 Yeah, I'm really interested in who pays for these flights 0:22:18.359 --> 0:22:21.000 because they just sent back the pandas and now they're returning. 0:22:21.320 --> 0:22:24.159 Is that something that the Chinese government is funding? Are 0:22:24.200 --> 0:22:27.000 American taxpayers funding that that? 0:22:27.040 --> 0:22:30.280 Actually, I do not know. That's a good question. It 0:22:30.440 --> 0:22:35.040 must be wrapped into the exchange agreement in some way. 0:22:35.119 --> 0:22:36.640 Yeah, these exchange agreements. 0:22:36.680 --> 0:22:40.120 It's interesting because when there are pandas from China coming 0:22:40.160 --> 0:22:42.880