WEBVTT - Bloomberg Surveillance TV: October 23rd, 2025 0:00:02.400 --> 0:00:06.760 Bloomberg Audio Studios, Podcasts, radio News. 0:00:11.680 --> 0:00:15.480 This is the Bloomberg Surveillance Podcast. I'm Jonathan Ferrow, along 0:00:15.520 --> 0:00:18.720 with Lisa Bromwitz and Amrie Hordert. Join us each day 0:00:18.760 --> 0:00:22.280 for insight from the best in markets, economics, and geopolitics 0:00:22.440 --> 0:00:24.880 from our global headquarters in New York City. We are 0:00:24.960 --> 0:00:27.680 live on Bloomberg Television weekday mornings from six to nine 0:00:27.720 --> 0:00:31.319 am Eastern. Subscribe to the podcast on Apple, Spotify or 0:00:31.320 --> 0:00:33.960 anywhere else you listen, and as always on the Bloomberg 0:00:34.040 --> 0:00:37.400 Terminal and the Bloomberg Business app. All eyes on tomorrow's 0:00:37.440 --> 0:00:40.440 CPI print, the first major day to release in weeks, 0:00:40.760 --> 0:00:43.920 expected to show inflationary precious mounting on the economy. The 0:00:44.040 --> 0:00:46.680 former Boston Fed president Eric Rosenngrand has seen it all. 0:00:46.720 --> 0:00:48.600 He joins us now for more. Eric, welcome back to 0:00:48.640 --> 0:00:51.199 the program Sir, What are you anticipating to see? What 0:00:51.240 --> 0:00:53.440 do you expect to see tomorrow morning at eight thirty 0:00:53.479 --> 0:00:54.000 Easton time. 0:00:55.680 --> 0:00:59.680 I'm expecting to see that both the CPI and the 0:00:59.720 --> 0:01:04.600 core CPI are at three point one percent. So for 0:01:04.680 --> 0:01:08.000 the overall CPI it was at two point nine percent before. 0:01:08.800 --> 0:01:12.440 That's a bit of an increase. It partly reflects some 0:01:12.520 --> 0:01:16.000 of the pressures coming from tariffs continuing to flow through 0:01:16.560 --> 0:01:19.160 so goods like apparel. 0:01:18.760 --> 0:01:20.160 Furniture, sporting goods. 0:01:20.840 --> 0:01:23.720 But it's also that we're seeing food prices go up 0:01:23.760 --> 0:01:27.559 in a variety of areas, and I think that indicates 0:01:27.640 --> 0:01:30.920 that we're not getting much progress on inflation, that this 0:01:30.959 --> 0:01:34.960 report actually is going to be a continuation of numbers 0:01:35.000 --> 0:01:38.160 that are at three percent or higher rather than moving 0:01:38.200 --> 0:01:40.920 down towards two percent. So that is a challenge for 0:01:40.959 --> 0:01:44.200 the Fed as it tries to weigh how much emphasis 0:01:44.200 --> 0:01:46.520 to put on inflation and how much emphasis to put 0:01:46.560 --> 0:01:48.960 on what's happening in the labor market. 0:01:49.080 --> 0:01:51.200 Well, Eric, let's stay on that theme. Are the sources 0:01:51.200 --> 0:01:54.080 of inflation the this Federal Reserve can ignore. 0:01:56.240 --> 0:02:01.200 I don't think it should ignore. The labor market, while 0:02:01.200 --> 0:02:05.240 it has been softer, is still fairly close to the 0:02:05.280 --> 0:02:10.120 Fed's estimate of full employment. And in some of the areas, 0:02:10.560 --> 0:02:14.520 both in food prices, we've seen cost of electricity going up. 0:02:14.880 --> 0:02:18.120 Some of those trends I think are something we have 0:02:18.160 --> 0:02:20.720 to keep an eye on. And while there have been 0:02:21.280 --> 0:02:24.400 some negative pressures, for example, shelters come in a little 0:02:24.440 --> 0:02:27.239 bit better, natural gas is likely to come in a 0:02:27.280 --> 0:02:30.280 little bit better. I think the overall package. I mean, 0:02:30.320 --> 0:02:34.040 we've been above the two percent inflation target for over 0:02:34.120 --> 0:02:37.600 four years, so at some point the FED has to 0:02:37.639 --> 0:02:42.080 start seeing some improvement inflation. So I would not be 0:02:42.160 --> 0:02:46.120 somebody who would view this as because it's partly coming 0:02:46.120 --> 0:02:48.000 from tariffs, that it should be ignored. 0:02:48.360 --> 0:02:53.560 Eric is a lot of this inflation policy induced, well. 0:02:53.440 --> 0:02:57.840 I think it is partly policy induced. It's certainly fiscal 0:02:57.880 --> 0:03:04.079 policy induced. Tariffs definitely have an impact on what the 0:03:04.360 --> 0:03:07.480 reported prices are going to be. I would also say 0:03:07.480 --> 0:03:11.560 that the immigration policy is a policy that probably means 0:03:11.600 --> 0:03:14.720 that some of the food prices have gone up as 0:03:14.800 --> 0:03:17.040 labor costs have gone up for people that are trying 0:03:17.040 --> 0:03:20.360 to harvest crops, and fruits and vegetables have been an 0:03:20.400 --> 0:03:24.520 area in particular where we've seen rising prices. In terms 0:03:24.600 --> 0:03:28.000 of monetary policy, I think the question is how much 0:03:28.040 --> 0:03:31.200 of the pressures that we're seeing have been accommodated. So 0:03:31.280 --> 0:03:34.200 the FED thinks it's restrictive, but if you think that 0:03:34.280 --> 0:03:38.240 the economy is more productive and that AI may contribute 0:03:38.240 --> 0:03:42.040 to that productivity, then it's a little unclear that we 0:03:42.080 --> 0:03:45.400 should be going back to the same interest rate that 0:03:45.480 --> 0:03:49.720 we were at prior to the pandemic. So the summary 0:03:49.760 --> 0:03:53.240 of economic projections that the Fed puts out is assuming 0:03:53.320 --> 0:03:58.920 that we'll see something Fed funds rate in the long 0:03:59.000 --> 0:04:02.280 run closer to three percent, So that would indicate a 0:04:02.320 --> 0:04:04.960 lot more room. But the fact that we've seen so 0:04:05.040 --> 0:04:09.640 little progress on inflation for the last six months indicates 0:04:09.680 --> 0:04:12.320 that you shouldn't be so confident that you know exactly 0:04:12.360 --> 0:04:14.920 what the real interest rate ought to be. 0:04:15.160 --> 0:04:15.360 Well. 0:04:15.400 --> 0:04:17.599 Not only that, the fact of the matter is the 0:04:17.640 --> 0:04:19.320 FED will be sitting down and they won't have the 0:04:19.400 --> 0:04:22.400 labor market report. They're just going to have this inflation report. 0:04:22.440 --> 0:04:24.360 Do you think it's a mistake if the Fed cuts 0:04:24.360 --> 0:04:25.520 interest rates next week? 0:04:27.200 --> 0:04:30.400 I think that given the softness and labor market, I 0:04:30.400 --> 0:04:33.480 can understand a twenty five basis point cut. I would 0:04:33.560 --> 0:04:37.000 highlight that while we're getting the CPI report, a lot 0:04:37.000 --> 0:04:40.440 of government workers left their jobs at the end of September, 0:04:40.960 --> 0:04:43.960 and a lot of the source data may not be available, 0:04:44.040 --> 0:04:47.719 So this CPI report probably is going to be using 0:04:47.760 --> 0:04:51.280 more estimated results than normal. It will be interesting if 0:04:51.279 --> 0:04:55.560 the report highlights that this data may not be as reliable, 0:04:55.600 --> 0:04:58.400 which means it could be noisier, and if it's noisier, 0:04:58.440 --> 0:05:01.400 it could be a surprise on the side or the downside. 0:05:01.800 --> 0:05:04.840 But it just says as we continue to have pressures 0:05:05.200 --> 0:05:08.760 on statistical organizations having enough people to gather the data, 0:05:09.200 --> 0:05:12.320 that this data may become noisier and harder to rely on. 0:05:12.640 --> 0:05:14.920 Eric, forgive the snark, but how reliable was the data 0:05:14.960 --> 0:05:15.520 when we had it? 0:05:17.160 --> 0:05:17.360 As it? 0:05:17.440 --> 0:05:19.920 Sorry, how reliable was the data when we had it? 0:05:21.720 --> 0:05:25.320 I think the CPI report was a pretty good report. So, 0:05:26.040 --> 0:05:32.120 I mean, they had significant amount of surveys across the country. 0:05:32.520 --> 0:05:35.680 They have had to cut back over time on the 0:05:35.720 --> 0:05:38.919 amount of survey work that they do. They've closed some offices, 0:05:40.000 --> 0:05:42.960 so I think that over the last few years it 0:05:43.000 --> 0:05:46.599 has deteriorated a little bit. But I think if we 0:05:46.680 --> 0:05:50.960 continue to be cutting back on statistical agencies, it'll get 0:05:51.000 --> 0:05:52.800 more unreliable as we go forward. 0:05:54.600 --> 0:05:58.080 Stay with us. More Bloomberg surveillance coming up after this. 0:06:06.880 --> 0:06:09.920 So here's the latest this morning, the President imposing significant 0:06:09.960 --> 0:06:13.800 sanctions on Russia, targeting the country's major oil producers. In 0:06:13.839 --> 0:06:15.880 London off the back of these movest includes Sara Piankie 0:06:15.920 --> 0:06:20.680 of Evakorasi joined US Now for more Sarah, consequences and objectives. 0:06:20.760 --> 0:06:23.080 Let's talk about objectives first. Does this get the president, 0:06:23.120 --> 0:06:24.840 the leader of Russia to the table. 0:06:26.120 --> 0:06:26.799 I will see. 0:06:26.880 --> 0:06:29.880 You know, obviously Trump has been very frustrated with his 0:06:30.040 --> 0:06:33.400 inability to you know, kind of make this happen and 0:06:33.440 --> 0:06:39.560 settle this down. He's obviously looking quite you know, really 0:06:39.600 --> 0:06:43.120 anxious to make progress on this. Certainly this is a 0:06:43.200 --> 0:06:46.240 key step. This has always been sort of one thing 0:06:46.320 --> 0:06:49.159 that folks have thought would bring a Putin more to 0:06:49.200 --> 0:06:52.279 the table. But we're gonna have to see how longed holts, 0:06:52.320 --> 0:06:56.760 how serious it is, how effective it is, and you know, 0:06:56.839 --> 0:06:59.560 until we see how this plays out, I think we 0:06:59.560 --> 0:07:01.280 should be judgment Sarah. 0:07:01.279 --> 0:07:03.080 How do you think this is going to play into 0:07:03.120 --> 0:07:05.760 the trade talks the President's going to have with Shijiping 0:07:05.839 --> 0:07:06.640 in South Korea? 0:07:08.320 --> 0:07:09.240 Well, it's interesting. 0:07:10.280 --> 0:07:13.640 I think that the United States and China have a 0:07:13.680 --> 0:07:15.680 lot of other issues to. 0:07:15.720 --> 0:07:17.160 Focus on right now. 0:07:17.760 --> 0:07:22.960 The anxiety and the escalation has been around something different, 0:07:24.280 --> 0:07:28.040 much more about rare earths and export controls and trying 0:07:28.080 --> 0:07:30.760 to keep these tariffs down. So it's a lot to 0:07:30.960 --> 0:07:33.400 really try to introduce this and to get China to 0:07:33.440 --> 0:07:37.200 take steps on this. I think If the agenda expands 0:07:37.240 --> 0:07:39.560 to this in an aggressive way, China will come back 0:07:39.560 --> 0:07:43.480 with questions about Taiwan, and I think it's. 0:07:43.320 --> 0:07:45.720 Not very likely that we'll see a lot of progress here. 0:07:45.920 --> 0:07:49.120 The trip administration is weighing export restrictions against China when 0:07:49.120 --> 0:07:52.240 it comes to critical software. I asked Everett eisenstat this 0:07:52.320 --> 0:07:54.200 in the last hour, and I love to get your take. 0:07:54.440 --> 0:07:57.600 Is this tangible policy or is this a new leverage 0:07:57.640 --> 0:08:00.560 point that the US wants to use just for negotiating tactic. 0:08:02.120 --> 0:08:04.200 Well, we've certainly heard that in the government. 0:08:04.240 --> 0:08:06.960 Everybody's been asked to sharpen their pencils and to find 0:08:07.920 --> 0:08:10.960 different aspects of things in the export control space that 0:08:11.000 --> 0:08:17.040 would really make China anxious. So look, I think if 0:08:17.120 --> 0:08:20.000 that's where the talks go, we're going to see China 0:08:20.000 --> 0:08:22.520 push back pretty hard on rare earths. I think they 0:08:23.080 --> 0:08:27.000 feel very aggressive and confident right now in that space, 0:08:27.560 --> 0:08:30.600 with good reason. So I think if we're in a 0:08:30.640 --> 0:08:34.400 space in this talk where we are introducing new things, 0:08:34.679 --> 0:08:38.000 that's not a great sign. Perhaps it will help some 0:08:38.120 --> 0:08:41.120 with leverage, but I think we all have to watch 0:08:41.160 --> 0:08:45.280 carefully because I think China is feeling quite bullish on this, 0:08:45.960 --> 0:08:49.080 and the risk is really that we overplay our hands. 0:08:49.520 --> 0:08:52.920 Do you think then that China has more leverage going 0:08:52.960 --> 0:08:54.280 in than the United States does? 0:08:56.320 --> 0:08:57.880 I think both of these. 0:08:59.160 --> 0:09:02.520 Great economic powers have both have leverage. And I think 0:09:02.520 --> 0:09:07.120 what's unique is that when the Trump administration negotiated last 0:09:07.160 --> 0:09:11.400 time with the Chinese, they didn't find that there wasn't 0:09:11.440 --> 0:09:15.040 this dynamic in the conversation, and so I think it 0:09:15.160 --> 0:09:17.040 has been a little bit of an on the job 0:09:17.120 --> 0:09:21.520 learning for some in the administration that China is willing 0:09:21.559 --> 0:09:22.600 to play as aggressively. 0:09:22.720 --> 0:09:23.599 So I don't know. 0:09:23.720 --> 0:09:26.400 They used rare earths back in May. Are you talking 0:09:26.400 --> 0:09:29.200 about when it was just down to agricultural purchases in 0:09:29.280 --> 0:09:29.880 Trump won? 0:09:30.520 --> 0:09:32.280 Yeah, I'm talking about in Trump one point zero. 0:09:32.400 --> 0:09:34.839 I think one of the reasons that the Chinese came 0:09:34.880 --> 0:09:37.679 out so strong with rare earths this time is they 0:09:37.679 --> 0:09:40.719 found last spring it worked really well for them, and 0:09:40.800 --> 0:09:44.760 so I think they are I think they were hoping 0:09:44.800 --> 0:09:47.560 to get more out of the talks than they saw coming, 0:09:47.640 --> 0:09:50.839 and I think it was pretty explicit strategy. I'm not 0:09:50.920 --> 0:09:53.520 quite sure they meant to overheat things quite so much, but. 0:09:54.720 --> 0:09:56.959 I don't know, you know, I think both sides have. 0:09:57.000 --> 0:09:59.880 Something the other team wants, and when you're in that 0:10:00.040 --> 0:10:04.240 situation and baling out both relationships, there's there's risk for escalation. 0:10:06.920 --> 0:10:10.439 Stay with us more Bloomberg Surveillance coming up after this. 0:10:19.240 --> 0:10:22.839 Another name, of course, is Tesla profit falling rising casts 0:10:22.880 --> 0:10:25.440 undermining a record quarter of a vehicle sales, the company 0:10:25.480 --> 0:10:29.440 reporting adjusted earnings down thirty one percent from a year ago. 0:10:29.720 --> 0:10:32.520 Dan Ives of Webbush maintaining and outperform rating on the 0:10:32.559 --> 0:10:34.840 stock with a six hundred dollars price target, saying we 0:10:34.920 --> 0:10:38.320 continue to believe Tesla could reach a two trillion dollar 0:10:38.360 --> 0:10:40.800 market camp in early twenty six in a ballcase scenario, 0:10:41.120 --> 0:10:43.360 and three trillion by the end of twenty six as 0:10:43.400 --> 0:10:47.400 the golden AI chapter takes hold at Tesla. Dan Ives 0:10:47.480 --> 0:10:50.120 joins us now for more Dan how relevant is the 0:10:50.120 --> 0:10:53.480 car making business at Tesla to this stock and how 0:10:53.520 --> 0:10:54.800 relevant should it be? 0:10:56.080 --> 0:11:00.120 Looker means foundational relative to you know, obviously ward are 0:11:00.160 --> 0:11:03.480 doing in the quarter and of course generating cash in 0:11:03.559 --> 0:11:07.000 the business. But the reality is the future is around AI, 0:11:07.760 --> 0:11:10.520 it's around autonomous, it's around robotics. 0:11:10.880 --> 0:11:13.560 I think it's the most important chapter in the history. 0:11:13.679 --> 0:11:17.319 From musk intest so That's why Musk now wartime CEO 0:11:17.400 --> 0:11:19.040 and obviously in new paid package. 0:11:19.200 --> 0:11:21.520 I think that's what investors are focused on any sell 0:11:21.559 --> 0:11:22.040 off here. 0:11:22.080 --> 0:11:26.000 Look, we view autonomous alone is worth the trillion dollars 0:11:26.000 --> 0:11:28.640 of the story. This will when with the video, be 0:11:28.720 --> 0:11:31.360 too the best. You know what I view physical AI 0:11:31.520 --> 0:11:32.480 plays in the market. 0:11:32.720 --> 0:11:34.800 Don I think a lot of people might agree with you. 0:11:34.960 --> 0:11:37.719 The autonomous could be worth a trilly onto someone. It's 0:11:37.760 --> 0:11:40.560 about whether it is for Tesla. What can you point 0:11:40.600 --> 0:11:43.439 to that demonstrates success. What are the metrics you're following 0:11:43.520 --> 0:11:46.800 that justify evaluation this company currently carries. 0:11:48.040 --> 0:11:50.640 Yeah, first off, I mean robotoxin. We've seen it in 0:11:50.679 --> 0:11:53.839 Austin ourselves. You know, I think that you have eight 0:11:53.880 --> 0:11:55.440 to ten cities by the end of the year, and 0:11:55.440 --> 0:11:59.120 we ultimately believe thirty cities in the first half. Then 0:11:59.200 --> 0:12:02.480 you ultimately will what's happened there, the geofns area, the 0:12:02.520 --> 0:12:05.560 safety driver getting removed. It's my view this is all 0:12:05.600 --> 0:12:08.320 heading toward level four right in terms of when you 0:12:08.320 --> 0:12:12.319 think about autonomous and what that means. Is no company 0:12:12.480 --> 0:12:16.800 in the world byd you know, pick any name out there, 0:12:17.120 --> 0:12:20.199 we'll have the scaling scope to compete with Musk and Tesla. 0:12:20.280 --> 0:12:23.600 When it comes to autonomous and cybercabs, that's the future. 0:12:24.080 --> 0:12:26.160 And then optimists, you know, I believe it's going to 0:12:26.160 --> 0:12:28.760 be you know, a key part of this story. That's 0:12:28.760 --> 0:12:30.839 how you're going to get to three trillion dollars market 0:12:31.040 --> 0:12:32.280 next twelve to eighteen months. 0:12:32.400 --> 0:12:35.280 But scaling competition is it? This space dan already looking 0:12:35.400 --> 0:12:36.080 very crowded. 0:12:38.280 --> 0:12:40.800 Look I'd say I mean crowded in terms of Waimo 0:12:41.000 --> 0:12:44.240 being first mover advantage, but they're in what five cities, 0:12:44.440 --> 0:12:47.120 you know, relative to From a scale perspective, I mean, 0:12:47.240 --> 0:12:49.000 I think Tesla is going to own eighty percent of 0:12:49.000 --> 0:12:52.960 the autonomous market and that's why from an investor perspective, Look, 0:12:53.000 --> 0:12:54.240 if you hate Tesla. 0:12:53.920 --> 0:12:55.720 You continue to hate it today, I get it. 0:12:56.000 --> 0:12:59.240 But the reality is that this is a golden age 0:12:59.320 --> 0:13:03.120 for Tesla looking ahead from autonomous to robotics, and that's 0:13:03.120 --> 0:13:06.079 why you talk about November sixth, what's going to be 0:13:06.160 --> 0:13:08.280 the most pay package and then they're going to own 0:13:08.400 --> 0:13:11.880 obviously a big piece of XAI. This is now the 0:13:11.920 --> 0:13:17.160 AI transformation happening in Tesla. Cars obviously are important, but 0:13:17.240 --> 0:13:19.680 that just sets the siege for I think it's gonna 0:13:19.679 --> 0:13:20.640 be historical move. 0:13:20.960 --> 0:13:22.319 Let's talk about the pay package. 0:13:22.360 --> 0:13:25.200 Elon Musk has a very colorful language yesterday on the 0:13:25.240 --> 0:13:27.480 call when it comes to the proxy advisors of some 0:13:27.520 --> 0:13:31.760 of these institutional investors. What does he need to achieve 0:13:31.880 --> 0:13:36.199 in order to get that headline trillion dollar pay package? 0:13:36.960 --> 0:13:38.960 Yeah, and look and go back to like the first 0:13:39.000 --> 0:13:41.400 pay package, the one that's right now caught up in Delaware, 0:13:41.480 --> 0:13:44.319 Like he did everything and more, and it just comes 0:13:44.360 --> 0:13:47.360 down to, like I agree in the fact that the 0:13:47.400 --> 0:13:51.440 biggest asset for Tessa's Musk Musk is Tesa Tessa's Musk. Look, 0:13:51.520 --> 0:13:54.040 you look, obviously some of those are very ambitious in 0:13:54.160 --> 0:13:57.000 terms of where they're ultimately going to hit in terms 0:13:57.000 --> 0:13:59.400 of the targets. But I think mid to high targets 0:13:59.440 --> 0:14:04.560 are hit able, and that's why incentivize him. Make him 0:14:04.640 --> 0:14:08.400 wartime CEO, that's what he's doing. That's whereas laser focused, 0:14:08.559 --> 0:14:11.319 you know, versus maybe some of the dark days when 0:14:11.320 --> 0:14:14.319 he was a TRUA administration. Obviously some of the brand damage. 0:14:14.640 --> 0:14:17.679 And I just think like betting against Musk has been 0:14:17.720 --> 0:14:20.320 the wrong move again again, and I think that's why 0:14:20.360 --> 0:14:23.000 shareholders overwhelming we will. 0:14:22.800 --> 0:14:25.480 Approve this let's just stand the pay package. What's the 0:14:25.560 --> 0:14:28.520 opposition to the pay package. What's your understanding of what 0:14:28.560 --> 0:14:30.800 it is? Besides the fact that it's subsurdly lines that 0:14:30.840 --> 0:14:33.560 kind of doesn't matter. What's the opposition to it? What 0:14:33.640 --> 0:14:34.800 don't people like about it? 0:14:36.080 --> 0:14:39.080 Look, I mean, obviously it's just you know, the view 0:14:39.160 --> 0:14:42.280 from an excess perspective, the actual numbers. 0:14:42.520 --> 0:14:44.240 You know, why do they actually have to do this? 0:14:44.360 --> 0:14:47.640 But I think to some extent it's investors that don't 0:14:47.720 --> 0:14:50.640 understand the Tesla story. And I think any of the 0:14:50.640 --> 0:14:54.440 core believers, any of the core followers, understand that the 0:14:54.520 --> 0:14:58.440 future of Tesla lies in Musk being CEO. And I 0:14:58.480 --> 0:15:03.160 think from pay package perspective, given the targets said high bars, 0:15:03.240 --> 0:15:05.600 that's where you want Musk to You don't want to 0:15:05.600 --> 0:15:06.560 set warl bars. 0:15:06.720 --> 0:15:09.360 And I think that's I think the board stepped up, 0:15:09.440 --> 0:15:10.440 Robin stepped up. 0:15:10.760 --> 0:15:13.760 This is the right pay baggage at the right time 0:15:14.360 --> 0:15:16.400 for what's going to be what i've us a golden 0:15:16.480 --> 0:15:18.200 chapter for Tessel. 0:15:20.080 --> 0:15:23.600 Stay with us. More Bloomberg surveillance coming up after this. 0:15:32.840 --> 0:15:35.680 The S and P five hundred achieving thirty three record 0:15:35.800 --> 0:15:38.240 highs this year, boosting bank profits and pushing the Wall 0:15:38.240 --> 0:15:41.360 Street bonus pool to new heights. The New York State 0:15:41.400 --> 0:15:46.120 Controller Tom Dinapolis saying, quote, well, uncertainty remains around interest rates, inflation, 0:15:46.280 --> 0:15:50.120 and the broader economy. Wall Street looks with another strong year. 0:15:50.400 --> 0:15:53.200 Tom joins us. Now from more, Tom, welcome to the program, sir. 0:15:53.200 --> 0:15:54.920 It's good to get some time with you. Let's just 0:15:54.960 --> 0:15:57.480 talk about how big those numbers are so far this 0:15:57.600 --> 0:16:00.280 year and what kind of benefit that provides to the 0:16:00.320 --> 0:16:01.080 state of New York. 0:16:02.080 --> 0:16:05.120 Now, the numbers are big, and we look at this closely. 0:16:05.160 --> 0:16:08.960 We monitor it because obviously revenue for New York State 0:16:09.000 --> 0:16:12.880 and New York City significantly is derived from what's happening 0:16:12.920 --> 0:16:15.040 on Wall Street. So we always do an annual report 0:16:15.040 --> 0:16:17.920 this time of year on the securities industry in New 0:16:18.000 --> 0:16:19.760 York City. What we find for the first half of 0:16:19.760 --> 0:16:23.000 this year profits of thirty billion dollars. So when you 0:16:23.040 --> 0:16:26.000 consider last year, for the total years about forty nine billion, 0:16:26.640 --> 0:16:28.480 we could be headed for a record. If the current 0:16:28.480 --> 0:16:31.120 trends continue, we could be talking about profits of sixty 0:16:31.160 --> 0:16:32.280 billion dollars this year. 0:16:32.400 --> 0:16:34.720 Tom, is there a risk that we take that for granted? 0:16:34.960 --> 0:16:37.360 As you know, and I'm sure you're following. We've got 0:16:37.360 --> 0:16:39.840 a mayoral race here in New York City, and at 0:16:39.840 --> 0:16:42.240 the top of the pose is a socialist. Now, Tom, 0:16:42.280 --> 0:16:44.880 it's amazing that in the beating heart of American capitalism 0:16:45.000 --> 0:16:47.680 we can have a socialist map. It's not something we've 0:16:47.720 --> 0:16:48.760 risk taking for granted. 0:16:50.400 --> 0:16:54.120 Well, look, New York City, New York State is quite resilient, 0:16:54.880 --> 0:16:55.120 you know. 0:16:55.200 --> 0:16:56.960 So between what. 0:16:56.920 --> 0:16:59.200 May happen in New York City what's happening in Washington, 0:16:59.320 --> 0:17:01.280 New York City is going to stay strong. What I 0:17:01.360 --> 0:17:03.840 think is key in all of this is that New 0:17:03.920 --> 0:17:07.720 York must continue to be the global capital for finance. 0:17:08.160 --> 0:17:11.000 And what I always say to my friends and neighbors 0:17:11.000 --> 0:17:12.959 in New York, however you feel about Wall Street, good 0:17:13.040 --> 0:17:16.400 or band, the reality is the services that we provide 0:17:16.400 --> 0:17:19.560 to the people of our city in our state significantly 0:17:19.640 --> 0:17:23.240 rely on the profits of Wall Street, the business taxes, 0:17:23.280 --> 0:17:25.000 the personal li ink of taxes that are generating the 0:17:25.040 --> 0:17:28.200 employment that's generated. So whatever is going on in the 0:17:28.240 --> 0:17:32.560 larger politics, we want these jobs to be continued to 0:17:32.600 --> 0:17:35.119 be located in New York. There's still more jobs in 0:17:35.200 --> 0:17:38.320 securities industry in New York City than any other city 0:17:38.359 --> 0:17:41.639 in the country. We've seen last year, we saw some 0:17:41.680 --> 0:17:43.840 growth in jobs in New York. This year it looks 0:17:43.880 --> 0:17:47.240 like it might be a slight retrenchment. But this is 0:17:47.280 --> 0:17:50.600 a win for New York State. And no matter who's 0:17:50.640 --> 0:17:52.480 going to be the mayor, no matter who's the president, 0:17:53.480 --> 0:17:57.680 no matter who's the state controller, wall Street, we want 0:17:57.880 --> 0:17:59.520 this to be the home right here in New York 0:17:59.560 --> 0:18:01.680 because we all benefit when Wall Street does well. 0:18:01.800 --> 0:18:04.680 Wall Street does. But does a future mayor Mundani want 0:18:04.720 --> 0:18:06.600 it to be? Do you think he's a possible threat 0:18:06.640 --> 0:18:10.080 to the securities industry's tax revenue if these individuals want 0:18:10.080 --> 0:18:11.040 to leave New York. 0:18:12.000 --> 0:18:14.040 Well, look, we already have an issue of tax payer 0:18:14.119 --> 0:18:16.840 migration having nothing to do with the current mayor's race, 0:18:17.200 --> 0:18:17.399 you know. 0:18:17.440 --> 0:18:17.520 That. 0:18:17.680 --> 0:18:21.439 Being said, when we look at our revenue picture, we 0:18:21.480 --> 0:18:25.480 do a monthly cash report, we call it revenue coming 0:18:25.520 --> 0:18:29.280 into the state, we continue to have tax collections, largely 0:18:29.320 --> 0:18:33.040 because of personal income tax revenue exceeding projections. So I 0:18:33.080 --> 0:18:35.399 know there's a lot of folks predicting gloom and doom, 0:18:35.440 --> 0:18:38.119 but so far, actually the money because of strong personal 0:18:38.200 --> 0:18:41.920 income tax collection coming in higher than projected, and solely 0:18:41.960 --> 0:18:43.480 to the extent that again we don't. 0:18:43.640 --> 0:18:47.000 The election has not happened yet, But if the new. 0:18:46.880 --> 0:18:49.760 Mayor has some ambitious goals as far as addressing or 0:18:49.760 --> 0:18:54.280 affordability more services that need to be paid for, you know, 0:18:54.880 --> 0:18:57.200 I think whoever the mayor is is going to want 0:18:57.240 --> 0:19:00.320 to see Wall Street to be profitable and strong and 0:19:00.440 --> 0:19:03.320 benefit from the taxes that will derive from that. 0:19:03.880 --> 0:19:05.720 You also have come out with a statement about Elon 0:19:05.840 --> 0:19:10.400 Musk's latest trillion dollar paper polls. So you're saying it's excessive, 0:19:10.720 --> 0:19:12.960 But do you think Tesla would be. 0:19:12.880 --> 0:19:14.600 Successful without Musk? 0:19:15.119 --> 0:19:17.320 And there's a number of hurdles he needs to jump 0:19:17.400 --> 0:19:19.680 through to even look at this kind of pay package. 0:19:21.080 --> 0:19:25.440 Well, obviously Musk has been a very key ingredient in Tesla. 0:19:26.359 --> 0:19:29.520 I won't dispute that, but our view has been that 0:19:29.640 --> 0:19:32.840 the board oversight has not been as independent or as 0:19:32.840 --> 0:19:34.000 stringent as it should be. 0:19:35.520 --> 0:19:38.560 How many billions or trillions does one person need to make? 0:19:38.720 --> 0:19:43.320 And you know, my concern is that the compensation package 0:19:44.240 --> 0:19:47.439 may have some broad milestones in there. There really should 0:19:47.440 --> 0:19:53.000 be more clear metrics and you know, to really justify 0:19:53.880 --> 0:19:56.040 this very very generous payout. I mean, how much how 0:19:56.119 --> 0:19:58.840 much money does one person need? And you know, it's 0:19:58.880 --> 0:20:01.600 been very clear from my perspective that some of the 0:20:01.640 --> 0:20:05.400 other activities that mister Musk has been involved in over 0:20:05.520 --> 0:20:09.320 recent months has taken away from his focus on Tesla. 0:20:09.520 --> 0:20:11.840 You've seen a lot of volatility in certainly in terms 0:20:11.880 --> 0:20:13.720 of the stock price. That's a concern to us as 0:20:13.720 --> 0:20:16.520 a shareholder. So we really would like to see more 0:20:16.520 --> 0:20:20.040 independence on the board. We're going to vote against the 0:20:20.080 --> 0:20:22.600 compensation package, going to vote against the board members who 0:20:22.600 --> 0:20:23.000 are up. 0:20:24.320 --> 0:20:25.800 I think that will make the company. 0:20:25.520 --> 0:20:28.560 Stronger if they would take some of our recommendations to heart. 0:20:28.640 --> 0:20:31.320 If they take more recommendations to heart, would you vote 0:20:31.320 --> 0:20:31.600 for it? 0:20:33.359 --> 0:20:33.520 Oh? 0:20:33.560 --> 0:20:35.520 Sure, if they If they come around to our point 0:20:35.520 --> 0:20:39.480 of view in terms of independence and more clear metrics 0:20:39.480 --> 0:20:42.600 in terms of what kind of milestones would have to 0:20:42.600 --> 0:20:46.000 be achieved for compensation package as generous as are proposing, 0:20:46.119 --> 0:20:48.840 we'd certainly reconsider. But you know, I think in terms 0:20:48.880 --> 0:20:52.840 of the dollar amount at this point, and when you 0:20:52.840 --> 0:20:56.080 would look at the concentration of stock ownership that mister 0:20:56.160 --> 0:20:59.840 Musk would have, we'd really continue to diminish any role 0:20:59.880 --> 0:21:03.160 that any other shareholders would have in say of the company. 0:21:03.480 --> 0:21:05.120 You know, I think those are those are concerns. 0:21:05.200 --> 0:21:07.120 My guess is they are not going to come around 0:21:07.160 --> 0:21:09.680 to our point of view between now and November sixth, 0:21:09.720 --> 0:21:10.560 when they have the meeting. 0:21:10.760 --> 0:21:12.160