1 00:00:00,160 --> 00:00:03,360 Speaker 1: This is Bloomberg Wall Street Week. What's the state of 2 00:00:03,400 --> 00:00:06,360 Speaker 1: corporate governance? The deficit is a real issue. The US 3 00:00:06,400 --> 00:00:09,880 Speaker 1: economy continues to send mixed signals. The financial stories that 4 00:00:10,000 --> 00:00:13,560 Speaker 1: cheap our world fed action to con concerns over dollar liquidity, 5 00:00:13,600 --> 00:00:16,599 Speaker 1: and encouraging China data. The five hundred wealthiest people in 6 00:00:16,640 --> 00:00:19,599 Speaker 1: the world. Through the eyes of the most influential voices 7 00:00:19,880 --> 00:00:23,320 Speaker 1: Larry Summers, the former Treasury Secretary, Star CEO, Kevin Johnson 8 00:00:23,440 --> 00:00:27,040 Speaker 1: sec Chairman j Clayton. Bloomberg Wall Street Week with David 9 00:00:27,080 --> 00:00:31,120 Speaker 1: Weston from Bloomberg Radio. Don't Rock the Boat, Mega tech, 10 00:00:31,280 --> 00:00:34,279 Speaker 1: California wildfires, the return of No Deal Brexit, and an 11 00:00:34,280 --> 00:00:37,159 Speaker 1: explosive book about President Trump all worked to set the 12 00:00:37,200 --> 00:00:40,720 Speaker 1: markets on edge. This is Bloomberg Wall Street Week. I'm 13 00:00:40,800 --> 00:00:44,440 Speaker 1: David Weston. This week we marked the nineteenth anniversary of 14 00:00:44,520 --> 00:00:49,680 Speaker 1: nine eleven. That beautiful September morning, torn apart by commercial airliners, 15 00:00:49,760 --> 00:00:51,840 Speaker 1: used his weapons to strike at the heart of Wall 16 00:00:51,880 --> 00:00:55,720 Speaker 1: Street and of Washington. Almost twenty years later. It may 17 00:00:55,760 --> 00:00:58,320 Speaker 1: be a virus now that has shaken us to our core, 18 00:00:58,800 --> 00:01:01,840 Speaker 1: changed our lives, and made us feel less secure. But 19 00:01:01,960 --> 00:01:05,200 Speaker 1: back then it was a terrorist attack. We talked with 20 00:01:05,240 --> 00:01:08,240 Speaker 1: one of those profoundly affected by nine eleven, Dan Chung, 21 00:01:08,600 --> 00:01:11,679 Speaker 1: who is now CEO of Alger Management, a firm that 22 00:01:11,760 --> 00:01:15,560 Speaker 1: lost thirty five employees that day, including the president of 23 00:01:15,600 --> 00:01:18,680 Speaker 1: the firm, David Alger, and the thirty five people represented 24 00:01:18,680 --> 00:01:22,800 Speaker 1: basically our entire investment team. I was the most senior 25 00:01:22,840 --> 00:01:24,880 Speaker 1: person who survived, but I was only thirty nine years 26 00:01:24,920 --> 00:01:27,399 Speaker 1: old at the time. And as a project matter, when 27 00:01:27,400 --> 00:01:29,560 Speaker 1: you wipe out that much of your organization, did you 28 00:01:29,600 --> 00:01:34,080 Speaker 1: consider not going forward, just shutting it down? Um, I'm 29 00:01:34,120 --> 00:01:36,520 Speaker 1: sure some of us thought we would go out, and 30 00:01:36,560 --> 00:01:39,040 Speaker 1: that was in fact, I think even in some of 31 00:01:39,040 --> 00:01:44,760 Speaker 1: the you know, the rumors. But I, personally Fred Alger, 32 00:01:44,920 --> 00:01:49,080 Speaker 1: we never considered not trying to rebuild. Um. It was 33 00:01:49,120 --> 00:01:52,960 Speaker 1: really important to us to try to honor the people 34 00:01:53,240 --> 00:01:56,480 Speaker 1: that we had lost and then also, uh, you know, 35 00:01:56,520 --> 00:02:00,600 Speaker 1: to honor the firm's history. Uh. In the investment world 36 00:02:01,040 --> 00:02:04,800 Speaker 1: by trying to rebuild and hopefully succeeding. When you have 37 00:02:05,240 --> 00:02:08,040 Speaker 1: some horrific event like this, there are at least two dimensions. 38 00:02:08,400 --> 00:02:10,760 Speaker 1: One is the business. What HAPs in business? There's also 39 00:02:10,840 --> 00:02:13,160 Speaker 1: the personal. I mean you have the relatives, the loved 40 00:02:13,160 --> 00:02:15,399 Speaker 1: ones of the people you've lost. How did you deal 41 00:02:15,400 --> 00:02:18,440 Speaker 1: with both of those at the same time. Well, those 42 00:02:18,520 --> 00:02:21,520 Speaker 1: are very difficult times, um, you know, with thirty five 43 00:02:22,720 --> 00:02:26,600 Speaker 1: people lost good friends David was my uncle in law. 44 00:02:27,520 --> 00:02:30,560 Speaker 1: But also uh, you know, I lost I was the 45 00:02:30,560 --> 00:02:33,120 Speaker 1: head of the technology. I lost junior people who just 46 00:02:33,280 --> 00:02:37,040 Speaker 1: graduated from college, it just started their first job. And 47 00:02:37,120 --> 00:02:38,960 Speaker 1: to talk to their parents that was that was the 48 00:02:38,960 --> 00:02:43,919 Speaker 1: hardest that the parents of of really young right um 49 00:02:44,160 --> 00:02:48,480 Speaker 1: kids who um you know and just died on nine 50 00:02:48,480 --> 00:02:52,320 Speaker 1: a lotn Um. I think you know, the best that 51 00:02:52,440 --> 00:02:56,120 Speaker 1: you can do is to listen to their stories, to 52 00:02:56,280 --> 00:02:58,720 Speaker 1: understand that they want to talk about their loved ones 53 00:02:59,560 --> 00:03:02,040 Speaker 1: and tried appreciate how special each one of them was 54 00:03:02,080 --> 00:03:05,840 Speaker 1: as an individual. I mean, I think that's that's critical 55 00:03:06,200 --> 00:03:09,360 Speaker 1: when you have experienced something like that loss, to just 56 00:03:09,600 --> 00:03:13,360 Speaker 1: really listen and support um the people and whatever and 57 00:03:13,400 --> 00:03:15,800 Speaker 1: whatever they want to tell you or not tell you, 58 00:03:15,919 --> 00:03:20,040 Speaker 1: whatever they want to do or not do. UM hard. 59 00:03:20,120 --> 00:03:22,919 Speaker 1: It was very hard time for all of us. Alger 60 00:03:22,960 --> 00:03:26,359 Speaker 1: management Uh not only survived, but in many ways it's 61 00:03:26,360 --> 00:03:30,040 Speaker 1: bigger and stronger than it was even back nineteen years ago. 62 00:03:30,360 --> 00:03:32,560 Speaker 1: How did you get from there to here? Given the 63 00:03:32,600 --> 00:03:35,360 Speaker 1: fact that you were almost on the grounds of extinction 64 00:03:35,880 --> 00:03:38,000 Speaker 1: and there you come back even stronger. How did you 65 00:03:38,040 --> 00:03:41,200 Speaker 1: do that? Well? I think you know, I realized that 66 00:03:41,240 --> 00:03:45,000 Speaker 1: the word honor is very important to me, and so 67 00:03:45,160 --> 00:03:49,560 Speaker 1: honoring the people, honoring the process it instinctively led me 68 00:03:49,640 --> 00:03:52,400 Speaker 1: to first that if we were going to rebuild the firm, 69 00:03:52,440 --> 00:03:55,559 Speaker 1: we had to rebuild it as in the same philosophy, 70 00:03:55,560 --> 00:03:58,640 Speaker 1: in the same culture and processed that the lost, my 71 00:03:58,680 --> 00:04:01,680 Speaker 1: lost colleagues and Dave at Alger had had had built. 72 00:04:02,360 --> 00:04:05,240 Speaker 1: That's what they had had worked so hard for. And 73 00:04:05,320 --> 00:04:07,760 Speaker 1: so I realized that the people who could help me 74 00:04:07,800 --> 00:04:10,880 Speaker 1: do that were what we call Alger alumni, people who 75 00:04:11,680 --> 00:04:14,520 Speaker 1: had learned it Alger often gotten their first break on 76 00:04:14,560 --> 00:04:16,279 Speaker 1: Wall Street, and for some of them it would have 77 00:04:16,279 --> 00:04:19,039 Speaker 1: been a tough, tough to get kind of break, and 78 00:04:19,040 --> 00:04:20,919 Speaker 1: then went on to success in other worries. And so 79 00:04:20,960 --> 00:04:25,080 Speaker 1: I was very fortunate to have a few alumni um 80 00:04:25,120 --> 00:04:27,880 Speaker 1: basically volunteer to come back to help rebuild the firm. 81 00:04:27,880 --> 00:04:30,800 Speaker 1: And that's when I realized talking to them that as 82 00:04:30,839 --> 00:04:32,919 Speaker 1: you look back on who was meaningful to you in 83 00:04:32,960 --> 00:04:34,840 Speaker 1: your lives, it's often the people who gave you your 84 00:04:34,880 --> 00:04:37,760 Speaker 1: first break or your who who gave you the tough 85 00:04:37,880 --> 00:04:40,440 Speaker 1: lessons that later on led to your success. And so 86 00:04:40,480 --> 00:04:42,200 Speaker 1: I had a few of those willing to come back, 87 00:04:43,200 --> 00:04:47,960 Speaker 1: and all committed to um rebuilding Alger in our same 88 00:04:47,960 --> 00:04:50,560 Speaker 1: philosophy and process and and in believing that that's the 89 00:04:50,560 --> 00:04:53,840 Speaker 1: way we would honor both the lost people and their work, 90 00:04:53,920 --> 00:04:56,520 Speaker 1: but also their personalities by trying to trying to keep 91 00:04:56,560 --> 00:04:59,359 Speaker 1: our culture alive, because that's what they cherished, that's what 92 00:04:59,400 --> 00:05:02,119 Speaker 1: they committed their effort too. It seems to me again 93 00:05:02,160 --> 00:05:05,160 Speaker 1: it does a lot about the loyalty people felt even 94 00:05:05,160 --> 00:05:07,800 Speaker 1: after they had left Alger. There was some special bond 95 00:05:07,839 --> 00:05:11,039 Speaker 1: there that obviously people even before you had invested in 96 00:05:11,160 --> 00:05:14,120 Speaker 1: and it came back to your benefit after eleven. Well, 97 00:05:14,160 --> 00:05:16,720 Speaker 1: I think if we all think about, you know, if 98 00:05:16,760 --> 00:05:19,479 Speaker 1: you get older. I'm quite a bit older now, but 99 00:05:19,640 --> 00:05:21,960 Speaker 1: hopefully even when you're younger, you can think about who 100 00:05:22,040 --> 00:05:24,360 Speaker 1: was meaningful. Was it an elementary school teacher, was it 101 00:05:24,440 --> 00:05:27,400 Speaker 1: a college teacher, or was it the first boss that 102 00:05:27,440 --> 00:05:30,120 Speaker 1: you had? You know, but who was meaningful in helping 103 00:05:30,120 --> 00:05:33,960 Speaker 1: you become you know, the fullest expression, the best expression 104 00:05:33,960 --> 00:05:35,720 Speaker 1: of of whoever you are. You know, help you get 105 00:05:35,760 --> 00:05:39,040 Speaker 1: your talents to the next level help you, you know, succeed. 106 00:05:39,760 --> 00:05:42,120 Speaker 1: And I think that's why there was so much UM 107 00:05:42,440 --> 00:05:47,520 Speaker 1: loyalty and passionate about rebuilding Alga, you know as Alga. 108 00:05:47,640 --> 00:05:49,440 Speaker 1: I mean, we could have gone out, for example, and 109 00:05:50,040 --> 00:05:53,359 Speaker 1: hired um star portfolio manages with other firms, you know, 110 00:05:53,400 --> 00:05:56,719 Speaker 1: with big track records and household names. But I sort 111 00:05:56,720 --> 00:05:58,960 Speaker 1: of recognized that wouldn't rebuild the firm as Algae. It 112 00:05:59,000 --> 00:06:01,480 Speaker 1: would just be sort of a a collection of the 113 00:06:01,480 --> 00:06:05,240 Speaker 1: well known people UM. And so it was really that idea, 114 00:06:05,839 --> 00:06:08,000 Speaker 1: and it didn't. It inspired a lot of people, and 115 00:06:08,040 --> 00:06:09,920 Speaker 1: I'm sure it inspires a lot of people today still 116 00:06:09,960 --> 00:06:13,160 Speaker 1: in whatever they may do. Your company, Aldre Cui had 117 00:06:13,279 --> 00:06:16,359 Speaker 1: a fairly strong DNA before nine eleven happened. As you 118 00:06:16,400 --> 00:06:19,440 Speaker 1: look forward to today, how has not eleven and the 119 00:06:19,480 --> 00:06:22,880 Speaker 1: loss of those thirty five beloved colleagues, how has it 120 00:06:23,000 --> 00:06:26,839 Speaker 1: changed the DNA of Alger management as you see it today. 121 00:06:27,080 --> 00:06:31,320 Speaker 1: I think that again I try to focus on some 122 00:06:31,360 --> 00:06:34,520 Speaker 1: of the core values that they had. They've of course 123 00:06:34,560 --> 00:06:39,400 Speaker 1: had to adapt over time. UM. The most important court 124 00:06:39,720 --> 00:06:42,360 Speaker 1: had was a meritocracy. I mean Wall Street is great 125 00:06:42,400 --> 00:06:45,680 Speaker 1: on the investment side for keep deliver great performance for 126 00:06:45,720 --> 00:06:50,000 Speaker 1: your clients. You can't really question the great performance that 127 00:06:50,160 --> 00:06:53,280 Speaker 1: was Dan Chung, President of Alger Management. Coming up, we 128 00:06:53,320 --> 00:06:55,800 Speaker 1: wrap up the week with our special contributor Larry Summers 129 00:06:55,839 --> 00:06:59,000 Speaker 1: of Harvard. That's next on Wall Street Week on Bloomberg. 130 00:07:04,120 --> 00:07:08,080 Speaker 1: This is Bloomberg Wall Street Week with David Weston from 131 00:07:08,200 --> 00:07:11,240 Speaker 1: Bloomberg Radio. Every week we turned to our special contributor 132 00:07:11,280 --> 00:07:13,480 Speaker 1: Larry Summers of Harvard to give us the highs and 133 00:07:13,520 --> 00:07:15,880 Speaker 1: the lows, and sometimes just the plain odd of the week. 134 00:07:16,120 --> 00:07:18,880 Speaker 1: Let's call it Summers says, and get through as much 135 00:07:18,920 --> 00:07:20,480 Speaker 1: of this as we can in a rather packed week. 136 00:07:20,760 --> 00:07:22,920 Speaker 1: Starting with our first question, Larry, which is what was 137 00:07:22,960 --> 00:07:25,360 Speaker 1: the biggest surprise for you this week that the President 138 00:07:25,360 --> 00:07:29,880 Speaker 1: of the United States decided to give eighteen hours on 139 00:07:30,000 --> 00:07:35,040 Speaker 1: the record interview to Bob Woodward with audio tapes that 140 00:07:35,080 --> 00:07:41,520 Speaker 1: Woodward could make uh public. It was a prescription for 141 00:07:41,720 --> 00:07:47,040 Speaker 1: showing his soul to the world in a context where 142 00:07:47,480 --> 00:07:51,360 Speaker 1: he couldn't possibly have ended up looking good. In fact, 143 00:07:51,400 --> 00:07:55,400 Speaker 1: he ended up almost worse than one could have imagined. 144 00:07:55,960 --> 00:07:59,280 Speaker 1: But the decision to do that was inexplicable to me, well, 145 00:07:59,360 --> 00:08:01,480 Speaker 1: particularly because it's not like Woodward has never done this 146 00:08:01,520 --> 00:08:03,680 Speaker 1: to anybody before. I mean, if you knew anything about 147 00:08:03,680 --> 00:08:06,760 Speaker 1: Woodward's past, He's done this to person after person after person. 148 00:08:06,840 --> 00:08:09,440 Speaker 1: I mean, it says two interesting things. It says something 149 00:08:09,480 --> 00:08:12,800 Speaker 1: about the degree of Huberts the president has, and it 150 00:08:12,880 --> 00:08:18,200 Speaker 1: says something about either the lack of strength quality or 151 00:08:18,280 --> 00:08:22,000 Speaker 1: lack of strength of his advisors. Because if anyone in 152 00:08:22,040 --> 00:08:25,080 Speaker 1: any of the administrations I had served in had had 153 00:08:25,080 --> 00:08:27,880 Speaker 1: any idea like that for the President of United States, 154 00:08:28,280 --> 00:08:31,480 Speaker 1: there would have been a clamor from everyone who worked 155 00:08:31,520 --> 00:08:34,839 Speaker 1: in the White House that it was crazy and dangerous. 156 00:08:35,320 --> 00:08:38,880 Speaker 1: So it was a mystery to me. But it's neither 157 00:08:38,960 --> 00:08:42,960 Speaker 1: the first nor the last mystery about how this president 158 00:08:43,040 --> 00:08:45,319 Speaker 1: conducts himself in office. And that also assumes that the 159 00:08:45,320 --> 00:08:47,600 Speaker 1: president actually listens to any of his advisors. I'm not 160 00:08:47,720 --> 00:08:51,199 Speaker 1: sure there's proof of that. That's the point, Yeah, exactly, 161 00:08:51,240 --> 00:08:53,880 Speaker 1: that's the point. Okay, how about on the radar, whether 162 00:08:53,920 --> 00:08:56,360 Speaker 1: it's next week, next month, next year, what's on there 163 00:08:56,440 --> 00:08:58,600 Speaker 1: on your radar that should be on ours? And maybe isn't. 164 00:08:59,080 --> 00:09:01,960 Speaker 1: I think we need to pay a tension to UH 165 00:09:02,360 --> 00:09:07,960 Speaker 1: fluctuations UH in the dollar. For a long time, currency 166 00:09:07,960 --> 00:09:16,800 Speaker 1: fluctuations have not been a large issue UM, but they 167 00:09:16,800 --> 00:09:22,559 Speaker 1: could be again, especially if we hit a stretch after 168 00:09:22,600 --> 00:09:26,880 Speaker 1: the election when there's a basic loss of confidence in 169 00:09:27,520 --> 00:09:30,560 Speaker 1: the way our system is functioning. In the context of 170 00:09:30,559 --> 00:09:36,160 Speaker 1: a disputed UM election, I could see a substantial judgment 171 00:09:36,240 --> 00:09:39,840 Speaker 1: by investors not to want to hold US assets and 172 00:09:39,920 --> 00:09:44,000 Speaker 1: certainly not want not to want to hold US assets 173 00:09:44,120 --> 00:09:48,520 Speaker 1: as a hedge against risk. So we've been in a 174 00:09:48,600 --> 00:09:52,360 Speaker 1: period where the focus has been on the interest bond market, 175 00:09:52,640 --> 00:09:55,600 Speaker 1: the focus has been on the stock market, the focus 176 00:09:55,600 --> 00:09:58,960 Speaker 1: has been less on the foreign exchange market, and I'm 177 00:09:59,000 --> 00:10:04,760 Speaker 1: wondering whether UH that's something that will deserve a careful, 178 00:10:05,480 --> 00:10:08,760 Speaker 1: careful look going forward. I think I could also go 179 00:10:09,480 --> 00:10:13,760 Speaker 1: in UH the other direction. The dollars traded down significantly 180 00:10:13,840 --> 00:10:19,160 Speaker 1: in recent months, and maybe the euro deserves to have strengthened, 181 00:10:19,640 --> 00:10:23,240 Speaker 1: or maybe this is something of a false dawn UH 182 00:10:23,320 --> 00:10:27,240 Speaker 1: in Europe, and Europe's going to encounter a variety of 183 00:10:27,360 --> 00:10:32,360 Speaker 1: challenges UH going forward. I just think there's more happening 184 00:10:32,840 --> 00:10:36,559 Speaker 1: that could hit the value of UH the dollar than 185 00:10:36,600 --> 00:10:39,360 Speaker 1: there has been in a while, and so people need 186 00:10:39,440 --> 00:10:44,559 Speaker 1: to be braced for significant changes in exchange trades and 187 00:10:44,640 --> 00:10:49,240 Speaker 1: for those to ramify UH into our markets. More broadly, 188 00:10:49,640 --> 00:10:54,640 Speaker 1: I think that so far um emerging markets have provided 189 00:10:54,760 --> 00:10:59,320 Speaker 1: less drama than most of us would have expected during 190 00:10:59,320 --> 00:11:04,280 Speaker 1: the COVID period, and that could easily change uh in 191 00:11:05,040 --> 00:11:08,720 Speaker 1: the months ahead. The figures today suggesting almost a million 192 00:11:08,760 --> 00:11:12,520 Speaker 1: new cases of COVID in India were pretty scary. And 193 00:11:12,559 --> 00:11:14,160 Speaker 1: maybe we've got a little bit of taste of the 194 00:11:14,360 --> 00:11:17,560 Speaker 1: uncertainty about the currency markets this week when the pound 195 00:11:17,600 --> 00:11:20,520 Speaker 1: really took it on the chin after Boris Johnson said 196 00:11:20,520 --> 00:11:22,320 Speaker 1: he was just gonna walk away from his deal. But 197 00:11:22,440 --> 00:11:25,080 Speaker 1: how do you discount or how do you price in 198 00:11:25,600 --> 00:11:28,880 Speaker 1: a really uncertain results of election, not who's gonna win, 199 00:11:28,960 --> 00:11:30,800 Speaker 1: but even whether we're gonna know it, and what do 200 00:11:30,880 --> 00:11:33,080 Speaker 1: we'll take to do that. I'm a lawyer, I've stayed lawer, 201 00:11:33,120 --> 00:11:35,360 Speaker 1: I've covered these elections a long time. I really don't 202 00:11:35,400 --> 00:11:38,000 Speaker 1: know how to project what's gonna happen in November, December, 203 00:11:38,040 --> 00:11:40,800 Speaker 1: even even January. Perhaps I think that's a real risk. 204 00:11:40,880 --> 00:11:43,040 Speaker 1: I think it's a risk for the dollar. I think 205 00:11:43,080 --> 00:11:48,480 Speaker 1: it's a big risk for equity markets. If you look 206 00:11:48,520 --> 00:11:52,480 Speaker 1: at what traders would call the forward curve of volatility, 207 00:11:53,000 --> 00:11:58,200 Speaker 1: it is showing record high levels of volatility standing out 208 00:11:58,640 --> 00:12:03,520 Speaker 1: around the period UH after the election. There's likely to 209 00:12:03,600 --> 00:12:07,480 Speaker 1: be some substantial difference between the people who vote in 210 00:12:07,559 --> 00:12:10,679 Speaker 1: person and the people who vote by mail, which means 211 00:12:10,720 --> 00:12:13,720 Speaker 1: that the votes that are counted on election day could 212 00:12:13,760 --> 00:12:18,280 Speaker 1: give a quite misleading signal as to uh the result 213 00:12:18,800 --> 00:12:23,600 Speaker 1: of the election. The Bush the Gore thing was a 214 00:12:23,679 --> 00:12:28,080 Speaker 1: serious challenge to the quality of American democracy, but there 215 00:12:28,200 --> 00:12:32,880 Speaker 1: was no one who doubted that if some legal process 216 00:12:33,160 --> 00:12:36,440 Speaker 1: ended in al Gore losing the election, he would accept 217 00:12:36,480 --> 00:12:40,000 Speaker 1: that defeat and urge his successors to do so. And 218 00:12:40,360 --> 00:12:45,800 Speaker 1: the same thing was true with respect to President uh Bush. 219 00:12:45,880 --> 00:12:49,199 Speaker 1: I'm not sure we can say that h right now 220 00:12:49,600 --> 00:12:52,800 Speaker 1: about the current president of United States. And I think 221 00:12:52,840 --> 00:12:57,080 Speaker 1: that does create a huge aura of uncertainty which will 222 00:12:57,120 --> 00:13:01,720 Speaker 1: have economic consequences. And I finally, Larry, what about conventional wisdom? 223 00:13:01,720 --> 00:13:03,880 Speaker 1: Where was it wrong this week? Often we find us wrong. 224 00:13:03,880 --> 00:13:06,320 Speaker 1: Where did you find it particularly mistaken? I think where 225 00:13:06,360 --> 00:13:10,240 Speaker 1: it may be wrong on a very broad issue, David 226 00:13:10,880 --> 00:13:13,680 Speaker 1: is conventional wisdom thinks that what we have to fear 227 00:13:14,280 --> 00:13:17,920 Speaker 1: is a super strong Chinese economy. I think we have 228 00:13:18,080 --> 00:13:22,000 Speaker 1: to fear at least equally much that China hits huge 229 00:13:22,040 --> 00:13:26,200 Speaker 1: economic turbulence, and in order to keep their society together, 230 00:13:26,840 --> 00:13:33,840 Speaker 1: they rally around nationalist ideas and aggressive ideas, and that 231 00:13:33,840 --> 00:13:37,720 Speaker 1: that becomes a source of conflict between the United States 232 00:13:37,720 --> 00:13:41,720 Speaker 1: and China. I am as nervous or more nervous about 233 00:13:41,800 --> 00:13:46,000 Speaker 1: Chinese economic fair than I am about Chinese success, and 234 00:13:46,040 --> 00:13:49,160 Speaker 1: I think the conventional wisdom should be as well, and 235 00:13:49,320 --> 00:13:51,680 Speaker 1: it isn't. Yeah, you don't want to have a wounded 236 00:13:51,880 --> 00:13:53,880 Speaker 1: China feeling there in a corner. We don't know what 237 00:13:53,920 --> 00:13:56,200 Speaker 1: they might do. We don't We don't at all know 238 00:13:56,320 --> 00:14:00,840 Speaker 1: what they might do. UH. There's plenty of history of 239 00:14:01,480 --> 00:14:07,920 Speaker 1: UH leaders turning to UH nationalism and to blaming foreign 240 00:14:08,600 --> 00:14:14,600 Speaker 1: UH foreign powers when they have domestic difficulties as a 241 00:14:14,640 --> 00:14:18,760 Speaker 1: way of rallying their populations. And the legitimacy of the 242 00:14:18,840 --> 00:14:24,120 Speaker 1: Chinese government has depended on the economic success it is delivered, 243 00:14:24,520 --> 00:14:29,080 Speaker 1: and if that economic success starts to diminish, they will 244 00:14:29,120 --> 00:14:36,000 Speaker 1: need other sources of legitimacy. And aggressiveness within Asia and 245 00:14:36,160 --> 00:14:41,119 Speaker 1: hostility to the United States and pointing to purported American 246 00:14:41,200 --> 00:14:45,680 Speaker 1: threats are potential sources of that legitimacy, and that could 247 00:14:45,800 --> 00:14:50,040 Speaker 1: lead to a much more contentious UH world and that 248 00:14:50,120 --> 00:14:52,320 Speaker 1: is what Summer says. Many thanks for our special contributing. 249 00:14:52,360 --> 00:14:54,880 Speaker 1: Larry Summers of Harvard coming up. The e c V 250 00:14:55,120 --> 00:14:58,200 Speaker 1: says the European economy doesn't need more help, at least 251 00:14:58,280 --> 00:15:01,120 Speaker 1: not yet. The contrigu to step Any Flanders says, the 252 00:15:01,200 --> 00:15:05,280 Speaker 1: only thing surprising was how positive its message was. That's 253 00:15:05,320 --> 00:15:13,920 Speaker 1: next Wall Street Week on Bloomberg. This is Bloomberg Wall 254 00:15:14,000 --> 00:15:18,400 Speaker 1: Street Week with David Weston from Bloomberg Radio. The European 255 00:15:18,440 --> 00:15:21,480 Speaker 1: Central Bank had a tricky task this week, keeping its 256 00:15:21,480 --> 00:15:24,520 Speaker 1: support for the economy where it was, even though there 257 00:15:24,560 --> 00:15:28,360 Speaker 1: are some signs of trouble ahead, leading ECB President Leaguard 258 00:15:28,440 --> 00:15:32,800 Speaker 1: to plot a steady course. We do not target, but 259 00:15:32,960 --> 00:15:38,040 Speaker 1: we monitor, and we monitor carefully because obviously the appreciation 260 00:15:38,160 --> 00:15:42,920 Speaker 1: of our currency has an impact on on our inflation. 261 00:15:43,080 --> 00:15:46,560 Speaker 1: Bloomberg Senior executive editor for Economics and Wall Street we contributed, 262 00:15:46,560 --> 00:15:50,440 Speaker 1: Stephanie Flanders, says that if anything, Madame Lagarde seemed a 263 00:15:50,440 --> 00:15:55,200 Speaker 1: bit more optimistic than expected, given where some data are pointing. Yeah, 264 00:15:55,240 --> 00:15:58,720 Speaker 1: and the language, certainly, the formal language out of this 265 00:15:58,880 --> 00:16:02,200 Speaker 1: meeting was exactly the same as at the last meetings, 266 00:16:02,240 --> 00:16:04,600 Speaker 1: appointing to the fact that risk were on the downside. 267 00:16:04,880 --> 00:16:06,480 Speaker 1: But coming into it, I think there were a number 268 00:16:06,480 --> 00:16:08,760 Speaker 1: of people in the markets considering the data in the 269 00:16:08,840 --> 00:16:11,640 Speaker 1: last few weeks in Europe had not been so great 270 00:16:11,760 --> 00:16:15,200 Speaker 1: that you've seen the recovery leveling off and even starting 271 00:16:15,200 --> 00:16:18,840 Speaker 1: to go down, the momentum sort of weakening in quite 272 00:16:18,840 --> 00:16:21,240 Speaker 1: a few European countries. We were wondering whether she would 273 00:16:21,280 --> 00:16:25,240 Speaker 1: sound even more downbeat, and in fact, as you suggest, 274 00:16:25,280 --> 00:16:28,200 Speaker 1: you know, the overall tone of her press conference was, 275 00:16:28,800 --> 00:16:32,160 Speaker 1: if anything, upbeat, and we actually have heard a bloomberg 276 00:16:32,360 --> 00:16:34,520 Speaker 1: heard soon after the meeting that some members of the 277 00:16:34,560 --> 00:16:37,360 Speaker 1: Council had wanted to be even more upbeat in their 278 00:16:37,440 --> 00:16:40,360 Speaker 1: language and had had been overruled. So are they seen 279 00:16:40,440 --> 00:16:42,640 Speaker 1: something in the numbers, because the numbers they had came 280 00:16:42,720 --> 00:16:46,080 Speaker 1: up marginally, I mean, they're not cheery economic numbers, but nevertheless, 281 00:16:46,160 --> 00:16:48,440 Speaker 1: whether it's GDP growth or where its inflation, they come 282 00:16:48,480 --> 00:16:51,920 Speaker 1: up so much since the last estimate. Yeah, I mean, 283 00:16:51,960 --> 00:16:54,360 Speaker 1: there was no there was no big change in the forecast, 284 00:16:54,360 --> 00:16:56,280 Speaker 1: but you're quite right, the growth forecast was just a 285 00:16:56,320 --> 00:16:59,800 Speaker 1: tiny bit better. But they're still expecting a big hole 286 00:17:00,080 --> 00:17:02,840 Speaker 1: to be missing in the European economy at the end 287 00:17:02,840 --> 00:17:06,240 Speaker 1: of the year due to the COVID recession. The inflation 288 00:17:06,359 --> 00:17:10,200 Speaker 1: numbers looking a little bit higher, but actually that probably 289 00:17:10,240 --> 00:17:12,280 Speaker 1: doesn't take into account the fact that the euro has 290 00:17:12,320 --> 00:17:15,080 Speaker 1: been swing soaring in the markets in the last few weeks, 291 00:17:15,119 --> 00:17:17,440 Speaker 1: so it's it would certainly this is not a time 292 00:17:17,440 --> 00:17:19,800 Speaker 1: when you would think that they would be changing their 293 00:17:20,240 --> 00:17:22,960 Speaker 1: their signaling around risks, and if anything is, you know, 294 00:17:23,040 --> 00:17:25,520 Speaker 1: many people in the financial markets are expecting them to 295 00:17:25,560 --> 00:17:28,879 Speaker 1: have to do more to stimulate the Arizona economy before 296 00:17:28,880 --> 00:17:30,960 Speaker 1: the end of the year. Stephane, you mentioned that the 297 00:17:31,000 --> 00:17:33,480 Speaker 1: euro sawing. It really has been on an uptick without 298 00:17:33,480 --> 00:17:36,840 Speaker 1: a doubt, and that poses some challenges for the European 299 00:17:36,880 --> 00:17:39,280 Speaker 1: Central Bank because the higher the eurog is, the harder 300 00:17:39,359 --> 00:17:41,560 Speaker 1: is to get the inflation up, which is their target. There, 301 00:17:41,840 --> 00:17:43,800 Speaker 1: Madam Regard did address that, so they talked about a 302 00:17:43,840 --> 00:17:47,640 Speaker 1: fair amount, although she didn't seem to be overly concerned. Yeah, 303 00:17:47,680 --> 00:17:49,680 Speaker 1: and this, if anything, is the first time we've seen 304 00:17:49,840 --> 00:17:53,840 Speaker 1: a shift in the Laguarde ECB relative to the European 305 00:17:53,880 --> 00:17:57,720 Speaker 1: Central Bank under her predecessor, Mario Dragi where the exchange rate, 306 00:17:57,760 --> 00:18:00,560 Speaker 1: although of course they don't formally say they're targeting exchange rate. 307 00:18:00,600 --> 00:18:03,000 Speaker 1: The exchange rate, it seemed to loom really large in 308 00:18:03,040 --> 00:18:05,680 Speaker 1: their strategy for stimulating the economy. They always wanted to 309 00:18:05,760 --> 00:18:08,560 Speaker 1: keep it down to help exporters, to help the economy. 310 00:18:08,840 --> 00:18:10,879 Speaker 1: She was sounding, and we get the impression that the 311 00:18:10,880 --> 00:18:15,560 Speaker 1: Council overall was not so concerned about the level of 312 00:18:15,600 --> 00:18:17,440 Speaker 1: the euro or the fact that it's likely maybe to 313 00:18:17,520 --> 00:18:20,399 Speaker 1: go up further, and that that that is a shift 314 00:18:20,400 --> 00:18:21,840 Speaker 1: and it's going to make it harder, as you say, 315 00:18:21,920 --> 00:18:24,439 Speaker 1: to hit that inflation target they which at the moment 316 00:18:24,520 --> 00:18:26,600 Speaker 1: they have no sign of hitting. It looks like in 317 00:18:26,640 --> 00:18:29,399 Speaker 1: two years time the core inflation rate will still be 318 00:18:29,440 --> 00:18:32,199 Speaker 1: only one point one percent, so really half of the 319 00:18:32,280 --> 00:18:35,160 Speaker 1: target they're trying to reach. Now. They've indicated, as I understand, 320 00:18:35,160 --> 00:18:37,119 Speaker 1: is that there are extraordinary bond baring program will go 321 00:18:37,160 --> 00:18:38,880 Speaker 1: through the middle of next year, but some people thought 322 00:18:39,040 --> 00:18:40,960 Speaker 1: she might extend that. When do they have to really 323 00:18:40,960 --> 00:18:43,639 Speaker 1: address that question of when they go even further with 324 00:18:43,720 --> 00:18:47,280 Speaker 1: that program. It's an interesting debate on the Council about 325 00:18:47,280 --> 00:18:49,600 Speaker 1: whether the amount that they've previously talked about for the 326 00:18:49,640 --> 00:18:52,480 Speaker 1: special program, the one point three five trillion euros, was 327 00:18:52,520 --> 00:18:55,000 Speaker 1: a ceiling or just a sort of overall amount that 328 00:18:55,040 --> 00:18:56,760 Speaker 1: they're going to spend, and then they might think about 329 00:18:56,800 --> 00:18:59,480 Speaker 1: spending more they don't have. They can keep up the 330 00:18:59,520 --> 00:19:01,480 Speaker 1: bond per just as you say through the middle of 331 00:19:01,560 --> 00:19:04,600 Speaker 1: next year. There's no particular moment where they're going to 332 00:19:04,680 --> 00:19:07,520 Speaker 1: have to announce a bigger envelope. But I think a 333 00:19:07,520 --> 00:19:09,640 Speaker 1: lot of people in the financial markets if you continue 334 00:19:09,720 --> 00:19:12,480 Speaker 1: to see this trajectory of the economy, the recovery kind 335 00:19:12,480 --> 00:19:16,240 Speaker 1: of bottoming out, flattening out, um not continuing. If you 336 00:19:16,320 --> 00:19:18,719 Speaker 1: like that last bit of the v I think there 337 00:19:18,760 --> 00:19:21,359 Speaker 1: will be quite a lot of question mark about whether 338 00:19:21,359 --> 00:19:23,480 Speaker 1: they should increase the bond purchases at the end of 339 00:19:23,480 --> 00:19:26,119 Speaker 1: the year, or at least announce that it's going to 340 00:19:26,200 --> 00:19:30,439 Speaker 1: increase and extend longer than the middle of one. Stephanie 341 00:19:30,480 --> 00:19:32,080 Speaker 1: is you know, well, in the United States, we really 342 00:19:32,119 --> 00:19:34,600 Speaker 1: focused particularly on the jobs numbers every month and trying 343 00:19:34,600 --> 00:19:36,600 Speaker 1: to figure out where the economy is. Gives us sense 344 00:19:36,600 --> 00:19:39,160 Speaker 1: of the employment situation over in Europe because it's done 345 00:19:39,160 --> 00:19:41,280 Speaker 1: relatively well as I understanding, but I also heard that 346 00:19:41,320 --> 00:19:43,880 Speaker 1: there's some of these furlough programs may be expiring at 347 00:19:43,880 --> 00:19:45,920 Speaker 1: some point. You know, every government is facing the same 348 00:19:46,000 --> 00:19:48,720 Speaker 1: challenge and it's a version of the challenge that the 349 00:19:48,800 --> 00:19:51,640 Speaker 1: lawmakers are facing in the US over the stimulus package, 350 00:19:51,640 --> 00:19:54,080 Speaker 1: but kind of in reverse. The US has had a 351 00:19:54,080 --> 00:19:56,479 Speaker 1: lot more people joined the unemployment roles, and then they 352 00:19:56,480 --> 00:19:58,320 Speaker 1: have a debate about whether or not to keep those 353 00:19:58,359 --> 00:20:01,520 Speaker 1: increased benefits going or not or try and reintroduce them. 354 00:20:01,560 --> 00:20:03,600 Speaker 1: In Europe, you have a lot of people who are 355 00:20:03,640 --> 00:20:06,840 Speaker 1: no not unemployed, yet they've managed to suppress, if you like, 356 00:20:07,240 --> 00:20:09,720 Speaker 1: the rise in the unemployment rate they might have seen 357 00:20:09,960 --> 00:20:12,560 Speaker 1: because they have these furlough programs or versions of it, 358 00:20:12,560 --> 00:20:16,000 Speaker 1: where the government is basically paying employers to keep people 359 00:20:16,080 --> 00:20:18,920 Speaker 1: on their books as an enormous program that was supposed 360 00:20:18,920 --> 00:20:20,680 Speaker 1: to run out at the end of October in the UK, 361 00:20:21,119 --> 00:20:24,600 Speaker 1: similar programs in Europe. Different countries are taking different decisions 362 00:20:24,600 --> 00:20:27,480 Speaker 1: on this. Germany has said it's going to extend its program, 363 00:20:27,480 --> 00:20:30,760 Speaker 1: Spain is saying it's going to end its program in September. 364 00:20:30,800 --> 00:20:33,320 Speaker 1: But there will be a lot of different countries of 365 00:20:33,440 --> 00:20:36,120 Speaker 1: difficult debates in different countries about that in the next 366 00:20:36,119 --> 00:20:38,920 Speaker 1: few weeks because at the moment, the unemployment rate much 367 00:20:38,960 --> 00:20:41,600 Speaker 1: lower than in the US because they have managed to 368 00:20:41,680 --> 00:20:44,680 Speaker 1: keep those people on the books, but still effectively paid 369 00:20:44,720 --> 00:20:47,880 Speaker 1: by the government, supported by the government. That was Stephanie Flanders, 370 00:20:47,920 --> 00:20:52,320 Speaker 1: Bloomberg Senior Executive editor for Economics, coming up. Whatever happened 371 00:20:52,320 --> 00:20:55,280 Speaker 1: to that fourth round of fiscal stimulus? Good? Can we 372 00:20:55,440 --> 00:20:58,200 Speaker 1: use it just about now? We asked, Speak of the House, 373 00:20:58,400 --> 00:21:08,680 Speaker 1: Nancy Pelosi. That's next Wall three Week on Bloomberg. This 374 00:21:09,040 --> 00:21:13,520 Speaker 1: is Bloomberg Wall Street Week with David Weston from Bloomberg Radio. 375 00:21:13,920 --> 00:21:16,480 Speaker 1: However we pay for it. The longer we wait for 376 00:21:16,520 --> 00:21:19,600 Speaker 1: more fiscal stimulus, the less urgent it seems to be. 377 00:21:20,240 --> 00:21:22,760 Speaker 1: But Speaker of the House Nancy Pelosi says it's needed 378 00:21:22,840 --> 00:21:26,159 Speaker 1: more than ever. Yes, we have tens of millions of 379 00:21:26,200 --> 00:21:30,760 Speaker 1: people who are unemployed in our country, and whatever the 380 00:21:31,080 --> 00:21:35,080 Speaker 1: analysis is of some for them at their kitchen table, 381 00:21:35,440 --> 00:21:38,800 Speaker 1: we need a stimulus. We need a stimulus in terms 382 00:21:38,840 --> 00:21:42,840 Speaker 1: of of job creation. We need money to invest in 383 00:21:43,160 --> 00:21:46,600 Speaker 1: ending This is just the mystery to me why this 384 00:21:46,680 --> 00:21:52,320 Speaker 1: administration has refused to invest in crushing the virus, because 385 00:21:52,320 --> 00:21:54,639 Speaker 1: it only in doing that are we able to open 386 00:21:54,680 --> 00:21:59,120 Speaker 1: the economy and open our schools safely. We need funding 387 00:21:59,240 --> 00:22:03,640 Speaker 1: for keeping people from being evicted. We need foods, security 388 00:22:03,760 --> 00:22:07,520 Speaker 1: funding and the rest and all of this is stimulus. 389 00:22:08,080 --> 00:22:14,080 Speaker 1: Food stamps are stimulus. Unemployment insurance benefits are stimulus to 390 00:22:14,200 --> 00:22:19,120 Speaker 1: the economy. So while they are stabilizers, that are also stimulus. 391 00:22:19,840 --> 00:22:23,359 Speaker 1: So if that's the case, why aren't people across the 392 00:22:23,400 --> 00:22:26,520 Speaker 1: way in the Senate and particularly across the aisle getting 393 00:22:26,520 --> 00:22:29,000 Speaker 1: that message Because they don't seem to be very inclined 394 00:22:29,040 --> 00:22:31,800 Speaker 1: to come to the table and get something done. Well. 395 00:22:31,840 --> 00:22:34,040 Speaker 1: I don't know why they don't, because the Chairman of 396 00:22:34,040 --> 00:22:37,560 Speaker 1: the FED and other uh FED leaders around the country 397 00:22:37,560 --> 00:22:40,800 Speaker 1: have said very clearly that we need a stimulus, that 398 00:22:40,840 --> 00:22:44,200 Speaker 1: we need a boost. Uh. They'd even referenced that state 399 00:22:44,240 --> 00:22:47,720 Speaker 1: and local governments a fiscal soundness is important to the 400 00:22:47,760 --> 00:22:51,960 Speaker 1: soundness of our economy. And in not supporting state and 401 00:22:51,960 --> 00:22:56,280 Speaker 1: local government, people will be UH put out of their jobs, 402 00:22:56,359 --> 00:23:00,000 Speaker 1: They'll go on unemployment insurance. What good is that? Why 403 00:23:00,000 --> 00:23:02,760 Speaker 1: would we want to deprive the American people of the 404 00:23:02,800 --> 00:23:06,919 Speaker 1: services they deserved. Why wouldn't we honor our hero food 405 00:23:07,280 --> 00:23:12,040 Speaker 1: I mean healthcare, as well as food, teachers, transportation, sanitation, 406 00:23:12,320 --> 00:23:16,280 Speaker 1: our first responders. Why would we want them to risk 407 00:23:16,359 --> 00:23:19,440 Speaker 1: their lives to save lives so they could lose their 408 00:23:19,560 --> 00:23:22,760 Speaker 1: jobs because they're just some in the Senate on the 409 00:23:22,760 --> 00:23:24,760 Speaker 1: Republican side of the aisle, who said they don't want 410 00:23:24,760 --> 00:23:28,399 Speaker 1: to spend one more dollar. Imagine they don't want to 411 00:23:28,400 --> 00:23:33,080 Speaker 1: send one more dollar to crush the virus to open 412 00:23:33,119 --> 00:23:36,760 Speaker 1: our economy by by crushing that virus to support our 413 00:23:36,800 --> 00:23:39,879 Speaker 1: staffel governments and putting money in the pockets of the 414 00:23:39,920 --> 00:23:43,439 Speaker 1: American people. And Manister, that leads me exactly the question, 415 00:23:43,680 --> 00:23:46,080 Speaker 1: is there a deal even though you wouldn't mind, not 416 00:23:46,200 --> 00:23:47,639 Speaker 1: want to take the deal, is there any deal you 417 00:23:47,680 --> 00:23:49,439 Speaker 1: could take it off? In the Republicans and you and 418 00:23:49,480 --> 00:23:52,399 Speaker 1: the Minority Leader Chuck schumerch said an emaciated bill? Is 419 00:23:52,440 --> 00:23:55,320 Speaker 1: there a bill at all? Even for an emaciated bill, 420 00:23:55,320 --> 00:23:58,560 Speaker 1: because as you said, some people say, not one dollar? Well, 421 00:23:58,960 --> 00:24:02,760 Speaker 1: what the sense McConnell put forth, as as fraudulent it 422 00:24:02,840 --> 00:24:07,280 Speaker 1: as as as a leader Schumer said, emaciated, it's not. 423 00:24:07,640 --> 00:24:09,520 Speaker 1: They call it a skinny bill, and he calls it 424 00:24:09,520 --> 00:24:12,400 Speaker 1: an emaciated villa. And I joined him in that it's 425 00:24:12,400 --> 00:24:14,520 Speaker 1: only a check the box so that some of his 426 00:24:15,000 --> 00:24:18,680 Speaker 1: endangered Republican senators can go home and say, well, see 427 00:24:18,720 --> 00:24:22,080 Speaker 1: I tried, but it isn't trying. It's not even an 428 00:24:22,119 --> 00:24:25,760 Speaker 1: attempt to do the right thing. And Mitch McConnell knows 429 00:24:25,880 --> 00:24:29,480 Speaker 1: that because he has to satisfy those Republicans in his 430 00:24:29,600 --> 00:24:32,680 Speaker 1: caucus who don't want to spend one more dollar, whether 431 00:24:32,720 --> 00:24:36,040 Speaker 1: it's feeding the food insecure children in our country, saving 432 00:24:36,040 --> 00:24:39,720 Speaker 1: their families from eviction, stopping the dismantling of the postal 433 00:24:39,800 --> 00:24:43,080 Speaker 1: service so that people can vote without risking their health. 434 00:24:43,640 --> 00:24:47,520 Speaker 1: With that again, first and foremost, crushing, crushing the virus, 435 00:24:47,560 --> 00:24:50,800 Speaker 1: and putting money into the pockets of the American people. 436 00:24:51,400 --> 00:24:55,600 Speaker 1: What they have is so meager that it insults the 437 00:24:55,680 --> 00:24:59,520 Speaker 1: intelligence of the American people. Does not solve the problem, 438 00:24:59,800 --> 00:25:02,840 Speaker 1: and it is not. Again, we know that we have 439 00:25:02,960 --> 00:25:05,920 Speaker 1: to compromise. We know we have to negotiate in order 440 00:25:05,920 --> 00:25:08,720 Speaker 1: to reach an agreement. We all want an agreement, make 441 00:25:08,760 --> 00:25:12,960 Speaker 1: no mistake about that. But get serious, get real, Mitch McConnell. 442 00:25:13,800 --> 00:25:17,280 Speaker 1: He paused, He pushed the pause. Remember my fifteenth when 443 00:25:17,320 --> 00:25:20,119 Speaker 1: we passed our bill, he pushed the pause button. Wasn't 444 00:25:20,280 --> 00:25:22,960 Speaker 1: until the last few weeks that he's now even coming 445 00:25:23,040 --> 00:25:26,679 Speaker 1: up with a suggestion. In that time, nearly five million 446 00:25:26,760 --> 00:25:29,480 Speaker 1: more people have been come infected since he pushed the 447 00:25:29,480 --> 00:25:33,359 Speaker 1: pause button, and nearly a hundred over a hundred thousand 448 00:25:33,600 --> 00:25:37,119 Speaker 1: people have died. So talk about what it means to 449 00:25:37,160 --> 00:25:38,720 Speaker 1: get serious. And I guess part of our question is 450 00:25:38,760 --> 00:25:42,800 Speaker 1: get serious with whom is it, Senator McConnelly, you're negotiating with. 451 00:25:43,040 --> 00:25:45,760 Speaker 1: Is it's a Secretary of the Treasury Minution? Is it 452 00:25:45,840 --> 00:25:47,920 Speaker 1: Mark Meadows of the White House? Who's on the other 453 00:25:47,960 --> 00:25:49,840 Speaker 1: side of the negotiating table from you to get to 454 00:25:49,920 --> 00:25:54,640 Speaker 1: apparently not Mark Meadows. But in terms of the negotiation, 455 00:25:54,720 --> 00:25:59,000 Speaker 1: the Republicans have to negotiate among themselves. Mitch McConnell has 456 00:25:59,040 --> 00:26:03,840 Speaker 1: this pathetic bill which is half of what the UH 457 00:26:03,840 --> 00:26:07,520 Speaker 1: Secretary of Minution has proposed. So they aren't even in agreement. 458 00:26:07,760 --> 00:26:10,680 Speaker 1: They are in disarray. We have said we would come 459 00:26:10,680 --> 00:26:13,480 Speaker 1: down first, we came down a trillion dollars. Then we 460 00:26:13,560 --> 00:26:18,120 Speaker 1: came down and further and said we would meet them halfway. UH. 461 00:26:18,160 --> 00:26:20,160 Speaker 1: And some of that is because we can put off 462 00:26:20,160 --> 00:26:23,480 Speaker 1: the timing of some of ours were not being Sophie's 463 00:26:23,560 --> 00:26:26,119 Speaker 1: choice by saying we're feeding some children and not others. 464 00:26:26,359 --> 00:26:31,320 Speaker 1: It's about timing, and we can have that negotiation. But 465 00:26:31,440 --> 00:26:35,760 Speaker 1: to ignore those needs to ignore how could they ignore 466 00:26:35,840 --> 00:26:38,040 Speaker 1: the virus and the spread of it and the cost 467 00:26:38,080 --> 00:26:41,720 Speaker 1: to our economy, our education system, and the rest. So 468 00:26:42,160 --> 00:26:44,800 Speaker 1: two of the sticking points for US are state and 469 00:26:44,840 --> 00:26:48,240 Speaker 1: local government, which by the way, not only provide meets 470 00:26:48,280 --> 00:26:52,119 Speaker 1: many needs of the American people, but provides over of 471 00:26:52,160 --> 00:26:55,960 Speaker 1: the public education system in our in our country meeting 472 00:26:55,960 --> 00:26:59,400 Speaker 1: our education needs. And then further money that is needed 473 00:26:59,440 --> 00:27:05,119 Speaker 1: coronavirus IRUs centric in terms of education were probably double 474 00:27:05,359 --> 00:27:08,120 Speaker 1: what they want to do, and of course the funding 475 00:27:08,760 --> 00:27:12,840 Speaker 1: for crushing the virus. There would be three areas where 476 00:27:12,880 --> 00:27:15,439 Speaker 1: we're pretty far apart. Man speaker on the state and 477 00:27:15,480 --> 00:27:17,760 Speaker 1: local assistance particularly, you know what the arguments on the 478 00:27:17,760 --> 00:27:19,359 Speaker 1: other side, they don't They don't want the money to 479 00:27:19,359 --> 00:27:21,359 Speaker 1: go for things like bloated what they would call bloated 480 00:27:21,359 --> 00:27:25,160 Speaker 1: pension plans. Are you are you willing to attach restrictions 481 00:27:25,200 --> 00:27:27,800 Speaker 1: that say it really goes for things specifically related to 482 00:27:27,840 --> 00:27:31,000 Speaker 1: COVID nineteen. Well, first of all, I wouldn't say those 483 00:27:31,000 --> 00:27:33,440 Speaker 1: are reasons that they're not doing it. I think those 484 00:27:33,440 --> 00:27:37,280 Speaker 1: are excuses because they don't believe in governance, they don't 485 00:27:37,280 --> 00:27:42,960 Speaker 1: believe in science. Therefore they haven't gone with the testing, tracing, treatment, isolation, 486 00:27:43,280 --> 00:27:47,920 Speaker 1: mask wearing, etcetera. They don't believe in science and there 487 00:27:48,160 --> 00:27:51,800 Speaker 1: don't believe in governance, so there is no this money 488 00:27:52,080 --> 00:27:54,840 Speaker 1: for that we're born in state and local government is 489 00:27:54,920 --> 00:28:00,320 Speaker 1: very very specific coronavirus centric purpose to to off set 490 00:28:00,359 --> 00:28:03,240 Speaker 1: some of the expenses that have already the outlays that 491 00:28:03,240 --> 00:28:07,119 Speaker 1: have already been made, UH to fight the virus and 492 00:28:07,200 --> 00:28:10,199 Speaker 1: meet the needs the health needs of people infected. And 493 00:28:10,320 --> 00:28:14,639 Speaker 1: secondly to talk about the loss of revenue because of 494 00:28:14,640 --> 00:28:19,280 Speaker 1: the shutdowns around the country that again we're having that 495 00:28:19,400 --> 00:28:24,600 Speaker 1: in there will prevent further of firing people will have 496 00:28:24,760 --> 00:28:27,399 Speaker 1: to be let all from work and then they'll go 497 00:28:27,480 --> 00:28:30,520 Speaker 1: on unemployment insurance. So where have you saved money by 498 00:28:30,600 --> 00:28:36,000 Speaker 1: reducing services to the American people and having a state 499 00:28:36,000 --> 00:28:39,200 Speaker 1: governments or tellings when have to raise taxes, fire people 500 00:28:39,280 --> 00:28:43,160 Speaker 1: and reduce services unless we get this resources. So what 501 00:28:43,200 --> 00:28:47,080 Speaker 1: the Republicans are saying is really quite sad because they 502 00:28:47,160 --> 00:28:50,120 Speaker 1: know that this money is corona centric and you have 503 00:28:50,200 --> 00:28:53,960 Speaker 1: to document the need in order to get the money. 504 00:28:54,760 --> 00:28:57,360 Speaker 1: As you describe this, I'm not sure how you get 505 00:28:57,360 --> 00:28:59,760 Speaker 1: there from here given the process that you've described, because 506 00:28:59,760 --> 00:29:01,960 Speaker 1: it's not clear exactly with whom you're negotiating or that 507 00:29:02,000 --> 00:29:04,280 Speaker 1: they have anything that they can negotiate, because some of 508 00:29:04,280 --> 00:29:05,960 Speaker 1: their members don't want to spend any money at all. 509 00:29:06,120 --> 00:29:07,840 Speaker 1: How do we get there, particularly given the fact that 510 00:29:07,880 --> 00:29:09,440 Speaker 1: you're going to have to go on recess to get 511 00:29:09,440 --> 00:29:13,520 Speaker 1: back to campaign back in home districts pretty soon, But 512 00:29:13,680 --> 00:29:16,000 Speaker 1: we'll be here for the month of September at least, 513 00:29:16,080 --> 00:29:18,760 Speaker 1: or as long as it takes. We have to make 514 00:29:18,760 --> 00:29:22,160 Speaker 1: sure that government is not shut down, as the President 515 00:29:22,280 --> 00:29:25,040 Speaker 1: so proudly announced he would take pride in shutting down 516 00:29:25,040 --> 00:29:27,400 Speaker 1: the government the last time it was shut down. So 517 00:29:27,920 --> 00:29:31,080 Speaker 1: we'll come to agreement on that. I feel quite certain. 518 00:29:31,760 --> 00:29:34,280 Speaker 1: We have other initiatives that we need to put forward, 519 00:29:34,520 --> 00:29:38,120 Speaker 1: and some of them go directly to making sure that 520 00:29:38,200 --> 00:29:42,120 Speaker 1: the American people UH that we are again making the 521 00:29:42,280 --> 00:29:47,200 Speaker 1: scientific decision to crush the virus UH, to honor our 522 00:29:47,240 --> 00:29:50,720 Speaker 1: heroes with state and local resources, and putting money in 523 00:29:50,760 --> 00:29:53,080 Speaker 1: the pockets of the American people, and at the same 524 00:29:53,120 --> 00:29:56,800 Speaker 1: time ensuring that people are able to vote without risking 525 00:29:56,840 --> 00:29:59,840 Speaker 1: their life for their health, so that they can vote safely, 526 00:30:00,480 --> 00:30:03,280 Speaker 1: ignoring what the President is saying about vote by mail, 527 00:30:03,800 --> 00:30:08,720 Speaker 1: which he does, and instead having confidence that their vote 528 00:30:08,720 --> 00:30:11,720 Speaker 1: will be counted as cast. So we have a tall 529 00:30:11,840 --> 00:30:14,760 Speaker 1: order to address here. And if you don't believe in science, 530 00:30:14,920 --> 00:30:17,360 Speaker 1: as they obviously do not, and you don't believe in 531 00:30:17,440 --> 00:30:19,640 Speaker 1: governance as many of them do not, they don't want 532 00:30:19,680 --> 00:30:23,640 Speaker 1: even spend any money to honor the science. Uh, then 533 00:30:23,640 --> 00:30:27,880 Speaker 1: there's a strong difference of opinion and we cannot We 534 00:30:27,920 --> 00:30:31,000 Speaker 1: will find agreement, I know we will, but then work 535 00:30:31,080 --> 00:30:32,880 Speaker 1: for that to happen, They're going to have to come 536 00:30:32,920 --> 00:30:36,160 Speaker 1: to their own agreement instead of being hundreds of billions 537 00:30:36,200 --> 00:30:40,040 Speaker 1: dollars apart between what Ms McConnell is doing and what 538 00:30:40,040 --> 00:30:43,840 Speaker 1: what Secretary Manuchin has suggested. Speaking of Rolloy, you referred 539 00:30:43,840 --> 00:30:45,760 Speaker 1: to the positive of shutting down the government, and there 540 00:30:45,760 --> 00:30:48,360 Speaker 1: have been reports that you and Secretary of Treasury Manuchin 541 00:30:48,440 --> 00:30:50,080 Speaker 1: have more or less agreed in a way to keep 542 00:30:50,120 --> 00:30:52,800 Speaker 1: it going, presumling with a continued resolution. Why are you 543 00:30:52,880 --> 00:30:55,160 Speaker 1: so confident, because it has been the case in the past, 544 00:30:55,160 --> 00:30:57,280 Speaker 1: the President Trump, even though we thought we had a deal, 545 00:30:57,400 --> 00:31:00,120 Speaker 1: basically changed his mind and shut down the government. Are 546 00:31:00,160 --> 00:31:03,720 Speaker 1: you confident to President Trouble will do that this time? Well, 547 00:31:03,760 --> 00:31:06,680 Speaker 1: you're never confident about the president when you're talking about 548 00:31:06,760 --> 00:31:09,680 Speaker 1: veracity or truth. That's why it's a waste of time 549 00:31:09,680 --> 00:31:12,479 Speaker 1: to even listen to what he says. What the fact 550 00:31:12,640 --> 00:31:15,600 Speaker 1: is is that we did not come to an agreement. 551 00:31:15,880 --> 00:31:20,560 Speaker 1: We separately acknowledged that it would be important for us 552 00:31:20,600 --> 00:31:24,880 Speaker 1: to have a clean, continuing resolution, that they would not 553 00:31:24,960 --> 00:31:28,120 Speaker 1: be heaping things on there that would be an unacceptable 554 00:31:28,240 --> 00:31:31,959 Speaker 1: for one side or the other. Uh. And so it 555 00:31:32,000 --> 00:31:35,280 Speaker 1: only makes sense to do that, and I feel quite 556 00:31:35,280 --> 00:31:39,000 Speaker 1: certain that we will get that done. And if the 557 00:31:39,040 --> 00:31:43,640 Speaker 1: President chooses to veto a continuing resolute, I would find 558 00:31:43,680 --> 00:31:47,280 Speaker 1: that hard for him to do that. Well, who knows. 559 00:31:47,320 --> 00:31:50,240 Speaker 1: The Republicans in Congress have never stood in the way 560 00:31:50,280 --> 00:31:53,360 Speaker 1: to any of his grotesque behavior, so I don't know 561 00:31:53,360 --> 00:31:56,360 Speaker 1: why they would start now, But nonetheless I think that 562 00:31:56,680 --> 00:31:59,680 Speaker 1: they It's not in anybody's interest for a government to 563 00:31:59,720 --> 00:32:02,920 Speaker 1: be shut down. It is uh. It is to be 564 00:32:02,960 --> 00:32:06,720 Speaker 1: avoided at all costs, and we have many times swallow 565 00:32:06,800 --> 00:32:10,120 Speaker 1: bitter pills in order to keep government open because it's 566 00:32:10,240 --> 00:32:12,440 Speaker 1: essential to do so. That was speaking of the House 567 00:32:12,480 --> 00:32:15,640 Speaker 1: of Representatives, Nancy Pelosi. And that does it for this 568 00:32:15,800 --> 00:32:19,360 Speaker 1: edition of Wall Street Week. I'm David Weston. This is Bloomberg. 569 00:32:19,640 --> 00:32:21,880 Speaker 1: See you next week.