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Speaker 1: Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keene Jay Lee.

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Speaker 1: We bring you insight from the best in economics, finance, investment,

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Speaker 1: and international relations. Find Bloomberg Surveillance on Apple Podcasts, SoundCloud,

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Speaker 1: Bloomberg dot Com, and of course, on the Bloomberg Place.

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Speaker 1: To say that, joining us in the studio, Mike Data,

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Speaker 1: m cam Partner's chief economist and macro strategist. Good morning

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Speaker 1: to Mike. Good morning, thanks for having your microphone is working.

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Speaker 1: I'm happy about that. You've got some leading indicators you

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Speaker 1: want to talk to us about, so run us through

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Speaker 1: them one by one on why maybe the jury is

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Speaker 1: still out on this economy. Absolutely so a lot of

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Speaker 1: happy talk on trade as was mentioned um and the

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Speaker 1: most recent raft of macro data looking pretty good g

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Speaker 1: d P and in jobs. So there's a sense that

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Speaker 1: you know, we've soft landed. Okay, the recession risk as

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Speaker 1: we're seated now, but keep in mind we went through

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Speaker 1: a multimonth yield curve in version period in the US

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Speaker 1: with twelvemonth forward recession probabilities peaking in August, so we

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Speaker 1: really need to get through next summer in my opinion,

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Speaker 1: without evidence of the business cycle, Um, you know, faltering,

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Speaker 1: and so what I would watch, you know, if I

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Speaker 1: just gave you one indicator from here, is I'd watch

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Speaker 1: the evolution of first time jobless claims like a hawk,

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Speaker 1: not a long leading indicator, but of you know, pretty powerful,

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Speaker 1: shorter term leading indicator. They'll tend to spike in a

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Speaker 1: very specific fashion just a few months before a downturn

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Speaker 1: that has not happened yet. But let's see how claims

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Speaker 1: perform as we go through the first half of next

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Speaker 1: year and ideally through next summer. So, Mike, we did

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Speaker 1: have some good jobs numbers last week, offsetting, uh, what

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Speaker 1: continues to be a you know, a weakening manufacturing sector

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Speaker 1: of business investment sector. How do we kind of weigh

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Speaker 1: those two things? We know the consumer is the economy,

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Speaker 1: but can we fully discount what's happening in the manufacturing sector.

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Speaker 1: I don't think so, because you know, manufacturing is cyclical,

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Speaker 1: so is business investment, and so sometimes if you're headed

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Speaker 1: into a downturn, it's really you know, those sectors, even

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Speaker 1: though they don't represent you know, a huge swath of

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Speaker 1: the economy that tend to falter first. So we shouldn't

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Speaker 1: just you know, write it off as irrelevant, but for

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Speaker 1: the time being, as you mentioned, the strength of the

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Speaker 1: consumer has really carried the day. We have two consecutive

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Speaker 1: down quarters of business fixed investments, so essentially you have

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Speaker 1: a capital spending recession. It looks like, you know, we're

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Speaker 1: sort of on the front edge of a bit of

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Speaker 1: a profits recession. You know, markets are jubilant, but you know,

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Speaker 1: we're basically beating dramatically lowered expectations for earnings. Yet the

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Speaker 1: consumer has been strong, so that's held growth up. Does

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Speaker 1: that continue through the first half of next year, or

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Speaker 1: does the foundation under the consumer economy, which is essentially

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Speaker 1: the labor market and confidence start to crack. That's what

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Speaker 1: we need to be worried about. Like, what do you

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Speaker 1: make of the analysis at the moment that these small

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Speaker 1: shifts at a single day to point gener right outsize

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Speaker 1: perception shifts from week to week. The global economy doesn't

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Speaker 1: move that fast, but the perception of what the global

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Speaker 1: economy is doing is moving radically from week to week

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Speaker 1: over the last number of months. Why Yeah, I think

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Speaker 1: there's a bit of a tendency to sort of over

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Speaker 1: analyze every data point. Maybe that's you know, the fault

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Speaker 1: of of us that are participating in the financial press

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Speaker 1: where we have to try to dissect every you know,

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Speaker 1: every piece of data, and maybe we make more out

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Speaker 1: of it than is really there. But I also think

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Speaker 1: we've had a situation where, if you go back a

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Speaker 1: few months months, we really kind of had the sum

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Speaker 1: of all fears coming together. There was recession fears at

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Speaker 1: you know, building, but you also had fears of a

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Speaker 1: hard brexit, fears of the trade war spinning out of control.

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Speaker 1: You know, we had the Hong Kong protests going full force,

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Speaker 1: and so a lot of that has receded now, at

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Speaker 1: least for the time being. And so you know, maybe

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Speaker 1: it maybe it seems like it's one piece of data,

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Speaker 1: but it's really these three or four things that were

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Speaker 1: weighing on the market that at least for now um

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Speaker 1: seemed to have receded. We caught up with Vice, Jam

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Speaker 1: and Clarida on Friday. He sounded really quite optimistic about

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Speaker 1: the U. S. Economy. That was my big Taika White

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Speaker 1: from the interview, just sitting there listening to him. Monitor

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Speaker 1: policy is in a good place. The U. S. Economy

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Speaker 1: is in a good place. Do you think it's in

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Speaker 1: a good place? Well, I think if you look at

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Speaker 1: the coincident indicators GDP jobs, you know, it looks like

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Speaker 1: a soft landing. And I think that's you know, what

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Speaker 1: he was referencing, and that that's what the Fed's goal was.

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Speaker 1: I mean, they tightened policy not to cause a recession,

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Speaker 1: but to slow growth to trend growth. Growth is essentially

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Speaker 1: slowed to trend, and so so far, so good. The

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Speaker 1: real question is is whether that continues as we move

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Speaker 1: into the first half of next year. I think that

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Speaker 1: the FED narrative here is basically a ninet or scenario

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Speaker 1: where ray were dropped seventy five basis points in the

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Speaker 1: business cycle continued after a slowdown, very sharp slowdown in

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Speaker 1: night it was really moving through a period of sharp

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Speaker 1: financial contagion and credit and currency markets. Uh. In this time,

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Speaker 1: you know, you have slowing growth, but at this point

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Speaker 1: still positive growth. So, Mike, do you think the FED

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Speaker 1: is in fact um we got that twenty five basis

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Speaker 1: point cut. Do you think they're on the sidelines now

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Speaker 1: to maybe mid next year? Well, if you look at

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Speaker 1: the twelve month forward FED funds futures market basically has

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Speaker 1: another one more cut. But you know, out there next

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Speaker 1: year and the FED is essentially following the market. Some

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Speaker 1: that makes some people angry, but is that good or bad?

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Speaker 1: Well following the market? Yeah, I don't think they really

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Speaker 1: have a choice, right, I mean, inflation expectations have come

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Speaker 1: way down from where we were last year and growth

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Speaker 1: has slowed, So if is some other guests, uh not

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Speaker 1: current company have come on and said this is an outrage.

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Speaker 1: The FED should be going the other away in raising rates.

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Speaker 1: I mean, that is a sure fire way to blow

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Speaker 1: up the business cycle. And if that happens, then rates

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Speaker 1: are going to zero or maybe even below zero. So

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Speaker 1: you know, the FED really doesn't have a have a

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Speaker 1: choice because you know markets are are looking at the

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Speaker 1: business cycle and and so they will lead the Fed.

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Speaker 1: So they suggest there's at least one more cut out there,

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Speaker 1: but if growth deteriorates next year, there'll be more than

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Speaker 1: one reduction. Let's finish up with the market called, shall we.

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Speaker 1: If you asked the global investor what had outperformed this year,

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Speaker 1: the decks or the SMP five hundred, I'm not sure

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Speaker 1: many people would actually say the docks, even though through

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Speaker 1: it has done, I would not have said that by

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Speaker 1: a couple of percentage points. The DAX is up. It

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Speaker 1: is the equity benchmark in Frankfurt, Germany, the SMP five D.

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Speaker 1: Have we seen the out performance in Europe already or

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Speaker 1: is there more to go here? Yeah, it's it's an

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Speaker 1: interesting question that we're actually struggling with. Um. You know, uh,

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Speaker 1: our our technical strategist J. C. O'Hara and myself are

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Speaker 1: taught are debating this now whether you know this, this

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Speaker 1: seeming outperformance and some of the European equity markets can continue.

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Speaker 1: You know, one argument would be there's already been a slowdown,

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Speaker 1: that's that's been reflected in. Simply a stabilization would be

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Speaker 1: enough for an outperformance to carry the day. Um, I'm

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Speaker 1: not super strongly convicted here. Um. You know, one thing

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Speaker 1: that bothers me a bit is even with this package

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Speaker 1: of monetary support that dragging announced on his way out,

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Speaker 1: very very little movement and forward looking inflation expectations, and

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Speaker 1: so it seems like the ECB does not have the

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Speaker 1: credibility or the confidence of the markets to stick to it.

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Speaker 1: Uh In in these low low inflation expectations are are

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Speaker 1: quite disturbing. So more of a question mark from me

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Speaker 1: on that score. My right to catch out with you

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Speaker 1: I'm camping as chief economists than Matt Crows strategists, so

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Speaker 1: we bring a semi shark perhaps of Global Advisor's chief strategist.

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Speaker 1: She joins us on the phone, see me your thoughts please,

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Speaker 1: and why this movie doesn't end the way it has

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Speaker 1: done so many times over the last eighteen months. Yeah,

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Speaker 1: you know, this trade deal stuff is I think the

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Speaker 1: market is getting a little bit optimistic. But then at

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Speaker 1: the same time, you know, the cars at the stars

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Speaker 1: do seem to be aligning that we will see some

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Speaker 1: kind of um concessions coming through, and it feels that

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Speaker 1: the Trump administration is actually getting that relatively desperate compared

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Speaker 1: to how they sounded in the past. Now, I think

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Speaker 1: for the for the market in general, though, the biggest

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Speaker 1: thing that they're going to be watching out for is

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Speaker 1: those December the fifteenth tariffs. Do they go ahead or not.

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Speaker 1: If they don't, then it's a great great news for

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Speaker 1: the consumer and ultimately for the overall economy. For the

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Speaker 1: US economy, that is all that mattered at the moment.

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Speaker 1: So I think if we do get any good news

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Speaker 1: on that side, you should see a rest with large

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Speaker 1: market rally just off the back of that. I talked

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Speaker 1: to Larry Cuddler on Friday, the National Economic Council Director Seema.

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Speaker 1: He did say that those terrorists for December were still

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Speaker 1: on the table. You do get the impression though, that

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Speaker 1: if we if we sign a phase one trade deal,

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Speaker 1: that goes away. Seem What Paul and I were talking about, though,

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Speaker 1: is that when you get to the thornier issues that

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Speaker 1: the Chinese just one budge on, this typically blows up

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Speaker 1: again going into Is it different this time around? Yeah,

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Speaker 1: I think it is slightly different. I mean, I agree

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Speaker 1: that I think the longer term structural issues are very

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Speaker 1: unlikely to be resolved, and we're not going to see

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Speaker 1: a full trade deal that maybe some people are expecting.

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Speaker 1: But the Trump administration is now going into election year,

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Speaker 1: the US economy is weak, h some people still expect recession,

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Speaker 1: so they need some kind of deal going into this,

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Speaker 1: and given that we've had so much focus on the contume,

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Speaker 1: I think that is all that matters at this moment.

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Speaker 1: But beyond that, the technology side, I think it's very

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Speaker 1: unlikely to resolved, not only in but even looking board.

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Speaker 1: If you're looking beyond in the next kind of three

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Speaker 1: or four years, that is going to be an gender,

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Speaker 1: which continued with whoever the next government is, or indeed

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Speaker 1: if it's a Trump administration continuing. So see you mentioned

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Speaker 1: the consumer here. We had some pretty good jobs numbers

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Speaker 1: last week. Give us your sense of how much of

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Speaker 1: this economy is really dependent upon the consumer. We know

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Speaker 1: the consumer the U S economy, but with the manufacturing

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Speaker 1: sector week, business investment weeks, seems like there's more pressure

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Speaker 1: than ever on the consumer. What's your reader the consumer? Now?

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Speaker 1: I would absolutely agree you know it is all about

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Speaker 1: the consumer at the momentum at this stage, I think

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Speaker 1: never held up relatively well. I think we should expect

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Speaker 1: to see some continued weakness in Q four mainly considers Harris,

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Speaker 1: were you starting to have almost taken that hole? But

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Speaker 1: looking beyond that, you know the job is claimed numbers.

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Speaker 1: I think they're really positive, and they're telling us that

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Speaker 1: the consumer may be able to withstand a lot of this.

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Speaker 1: Now with the Fed also keeping rates solo, everything is

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Speaker 1: working in order to keep the consumer going. But I

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Speaker 1: don't think I canna stay as strong as they have.

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Speaker 1: I think there's some weakness, but I don't think it's

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Speaker 1: going to fall over the edge. Where you have the

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Speaker 1: consumer then bring in the US into recession. UM. So,

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Speaker 1: on that basis, I think the market outlook is is

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Speaker 1: relatively positive. Is this a good entry point for the

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Speaker 1: rest of the world x us. We talked earlier on

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Speaker 1: the program about how actually Europe stared to outperform the

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Speaker 1: dances already seen. Why is this a moment if you do,

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Speaker 1: indeed think it is to actually start to reallocate some

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Speaker 1: capital away from the United States to the rest of

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Speaker 1: the world. There's a whole host of reasons at this stage.

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Speaker 1: You know, if you look at Europe, for example, as

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Speaker 1: you said, valuations are rather be more attractive than on

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Speaker 1: the senwhere else in the world. Um, if you do

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Speaker 1: expect the manufacturing site to at least be troughing, you've

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Speaker 1: taken off all of the worries about breaks it. A

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Speaker 1: lot of the worries about Italy are kind of in

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Speaker 1: the background at the moment. So this is a decent time.

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Speaker 1: And then you also have the ECB which is very

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Speaker 1: very accommodative and it doesn't look like it's going to

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Speaker 1: be reversed. Plus you potentially have fiscal stimulus in the agenda.

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Speaker 1: So the outlook for Europe is improving. And on the

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Speaker 1: emerging markets. If we now think that the dollar is

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Speaker 1: at its peak and it's going to be at least

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Speaker 1: in a slight weaking trends from here, this is the

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Speaker 1: time that emerging markets can start to look really attractive.

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Speaker 1: You have to think your country wisely still, as it

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Speaker 1: will be the case for as long as the global

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Speaker 1: economy is even slightly weak. Um. But if you're invested

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Speaker 1: and you're allocating around, you have to be cautious. But

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Speaker 1: there are still many opportunities outside of the US that

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Speaker 1: investors should start considering. So see, we're this is I guess,

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Speaker 1: the last big week of earnings releases. What is your

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Speaker 1: takeaway so far this season? It's it's been better than

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Speaker 1: we expected. I think that's been the case almost all around.

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Speaker 1: We had been Um. You know, if you look at

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Speaker 1: the economic data, for example, just to pear my new order,

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Speaker 1: isn't it that was suggesting that we would be looking

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Speaker 1: at an earnings recession right now? Um, that hasn't been

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Speaker 1: the case. And I think that the market has really

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Speaker 1: Um it's helped out the companies that have beaten expectations.

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Speaker 1: They have the market responsive be very positive, and yet

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Speaker 1: the ones that have have disappointed have been totally beaten up,

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Speaker 1: so there's still a lot of caution out there. I

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Speaker 1: don't think this is the end. I think Q four

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Speaker 1: you could see further weakness and earnings, but I think

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Speaker 1: Q one is going to be a much much better quarter.

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Speaker 1: This is such a polarized debate right now. I caught

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Speaker 1: up with Bob Michael of JP Morganes in Management to

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Speaker 1: End last week and he was really blunt with me,

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Speaker 1: and he said, the following the feeds behind the curve,

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Speaker 1: they overestimate the probability of compromise on the trade front.

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Speaker 1: They over underestimate the spillover impact from manufacturing to services

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Speaker 1: and employment. The next leg of the bond ball market

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Speaker 1: has commenced. Samuel, what's the push back to that? I

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Speaker 1: mean it's I don't know if there's a pushback, but

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Speaker 1: I think maybe they're a little bit early to the

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Speaker 1: game on this one. You know, when we look at

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Speaker 1: the bond market, if you just look at the YELD

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Speaker 1: curve version, yes it is signaling recession ahead, but I

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Speaker 1: don't think it's recession signaling recession for twenty But there

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Speaker 1: are clearly there are problems building up. So I think

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Speaker 1: the decent year but you go into and there are

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Speaker 1: the bubblesusiness of the corporate debt side, which now people

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Speaker 1: are starting to take more notice of. So yeah, perhaps

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Speaker 1: the FED is doing everything that it can. I think

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Speaker 1: I don't necessarily believe that they're behind the curve. I

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Speaker 1: think they struggle with their communications, and I think they've

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Speaker 1: struggled because of the difficulty reading the trade situation. I

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Speaker 1: don't necessarily think they're behind the curve. But what I

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Speaker 1: think from here is it when we get into twenty

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Speaker 1: if by the end of you have a weakness in

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Speaker 1: the economy coming through and you have a little munchy

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Speaker 1: stimmers left and you have little powers this stimilar side,

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Speaker 1: then I think things start to go bad. But I

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Speaker 1: do believe that is good. Year one might be a

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Speaker 1: completely different story though, So seem are we defensive right here?

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Speaker 1: Some of those defensive sectors that we hear about a lot, utilities, reads,

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Speaker 1: consumer stables, they're not cheap. Now, they're absolutely not cheap.

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Speaker 1: And the thing that we've been saying is that you

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Speaker 1: need to maintain your defenses exposure because look, although there

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Speaker 1: is we don't expect the recession to come through next year.

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Speaker 1: We think there's a slowdown in place at the same time,

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Speaker 1: because we believe that you're coming to the trough in

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Speaker 1: the global economic slowdown. This is the time to start

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Speaker 1: thinking about increasing slightly your those two cixicles, the ones

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Speaker 1: that we like, technology and financials. We think there's going

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Speaker 1: to be steepening your curve as you go into next year,

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Speaker 1: and that's your play with financials. And typically when you

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Speaker 1: do see an economic upturn, even if it's very modest,

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Speaker 1: people usually tend to rush for technology. But I think

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Speaker 1: you do need to be cautious. We would not be

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Speaker 1: necessarily talking very well about consumer discretionary at this stage

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Speaker 1: because of you know, we see that some weakness coming

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Speaker 1: through for the consumering Q four. But this is the

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Speaker 1: time to start thinking about rotating a little bit into cixical. Sama.

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Speaker 1: Thank you. Always going to Catcher when you see their

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Speaker 1: principal global investors advisers rather chief strategist Donald's down by

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Speaker 1: just one point six seven percent. Steve Easterbrook, the CEO

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Speaker 1: no longer on the phone and place to say Sarah,

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Speaker 1: Senator Sanford Bernstein's senior research analyst, Good morning to you, Sarah.

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Speaker 1: What's the message for clients after this firing? Good morning. Um,

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Speaker 1: you know the message is that from what we can

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Speaker 1: tell his you know, Easterbrook successor, Chris Kobzinski, was intimately

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Speaker 1: a part of the strategic UH decisions and setting the

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Speaker 1: strategy for the next few a few years. He started

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Speaker 1: as the head of Global strategy and business Development, so

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Speaker 1: he basically co authored the company's vision plan. You know,

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Speaker 1: he's about as um, you know, as involved as a

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Speaker 1: person could be. And having set the strategy and now

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Speaker 1: having seen it through for the last couple of years

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Speaker 1: as president of the US business. So um, interesting, Sarah,

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Speaker 1: give us a sense of what's going on at McDonald's here.

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Speaker 1: I see the stock up only about nine percent this year.

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Speaker 1: Gives a sense of how their position in the marketplace

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Speaker 1: right now, strengths and weaknesses. Um, you know they are um,

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Speaker 1: you know, a leading q s R. I think their

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Speaker 1: business has been quite solid. Uh. And if you look

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Speaker 1: at the same store sales numbers, which is usually the

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Speaker 1: first metric that investors look at, so you know, they've

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Speaker 1: had a very good year today performance both within the US,

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Speaker 1: where it's been same store sales growth around five percent,

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Speaker 1: and also even better arguably internationally where the same store

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Speaker 1: sales growth has been even higher. So um, the strategies

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Speaker 1: that they have been affecting over the last couple of

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Speaker 1: years are working, um in driving you know, increased sales

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Speaker 1: and their stores. The challenge this year has been there's

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Speaker 1: been a lot of reinvestment. But I think in general, um,

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Speaker 1: you know, what we have seen is when McDonald's reinvest,

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Speaker 1: or when any large company reinvest ahead of the industry,

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Speaker 1: it tends to pay dividends over time. And I think

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Speaker 1: that's why we are seeing uh sustained higher paces same

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Speaker 1: store sales growth out of the company. Do you think

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Speaker 1: that in general for a long term outlook of a

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Speaker 1: company like McDonald's said, it's better to take swift action

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Speaker 1: and boot a popular, successful chief executive officer who has

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Speaker 1: really uh lad the business forward, versus taking a step

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Speaker 1: back and trying to figure out perhaps another path. Well,

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Speaker 1: you know, I think, um, this is the you know,

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Speaker 1: this is the policy McDonald's has, and and nobody is

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Speaker 1: you know, above reproach. I think, um, so you know,

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Speaker 1: they did what they have to do, and I think,

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Speaker 1: you know, to your point, having certainty is always better.

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Speaker 1: Market is down, but it's not down a law. I

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Speaker 1: assume that many people think that we have a continuity candidate,

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Speaker 1: candidate in the hot seat. And this continues Raymond James

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Speaker 1: pointing out this morning that McDonald's has one of the

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Speaker 1: deepest and longest tenured management teams. Sarah, is that what

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Speaker 1: you see too, and how important is that going to

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Speaker 1: be in the coming years? Well, um, you know, I

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Speaker 1: think it's um. You know, if if you if you

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Speaker 1: look at at their management team, you look at the

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Speaker 1: biographies in our online you know, it's hard, it's hard

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Speaker 1: to argue that they don't have a very good management team. Um.

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Speaker 1: You know. The new head of the US has been

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Speaker 1: there since at mc donald since two thousand and two,

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Speaker 1: so very long tenured. He was previously running the international

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Speaker 1: operated markets, So these are the markets outside the US

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Speaker 1: where they have a lot of company operated stores. Um,

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Speaker 1: you know, And I think any of the other members

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Speaker 1: of the c team, if you look at them, with

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Speaker 1: a few exceptions, have been at McDonald's for quite a

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Speaker 1: long time, you know, twenty five years in the case

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Speaker 1: of the head of the international Development license market. So

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Speaker 1: I always think having a deep bench is critical, you know,

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Speaker 1: especially when you have some transition at the very top.

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Speaker 1: You want to make sure that the kind of day

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Speaker 1: to day operations, um don't get overlooked in that process.

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Speaker 1: And I think having very tenured people who have been

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Speaker 1: in their roles are similar similar roles for a long

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Speaker 1: time is important. Let's get to the day to day ops.

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Speaker 1: There seems to be a little bit of tension at

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Speaker 1: the moment between the headquarters corporate policy coming down from

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Speaker 1: the C suite and the franchise ease. How big is

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Speaker 1: that tension at the moment, Sarah, and how difficult will

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Speaker 1: it be for Kemsinski to resolve it? Well, I think

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Speaker 1: they've actually they have resolved a lot of it, or

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Speaker 1: at least um uh the you know, from what we

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Speaker 1: can observe, that's been the case. So there's no question

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Speaker 1: when they first rolled out some of these initiatives in

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Speaker 1: the US, they were asking franchisees to do a lot,

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Speaker 1: you know, remodel their stores. They had changes in the

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Speaker 1: UH in the field leadership or the way they organized it.

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Speaker 1: They were changing how they were approaching media buying. You know,

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Speaker 1: there was a lot to swallow important the pun at

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Speaker 1: the same at all at once. And so I think

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Speaker 1: what we have observed is that, you know, Chris Kinzynski

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Speaker 1: went on a listening tour last year, really talked to

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Speaker 1: the operators, made some concessions. UM. In the end, not

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Speaker 1: a lot has changed because I think the operators saw

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Speaker 1: that the strategy was the right one. So if you

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Speaker 1: look at the pace of the deployment of Experience of

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Speaker 1: the Future, it's really very similar to the initial timeline

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Speaker 1: they rolled out, even though they've given franchise these a

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Speaker 1: couple more years to get this done and still receive

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Speaker 1: some subsidies from McDonald's. UM. So, I would say, you know,

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Speaker 1: if you look at operating measures, you know, customer satisfactions

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Speaker 1: at all time eyes. If you look at financial metrics,

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Speaker 1: franchise cash flows are um, you know, better than they

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Speaker 1: were last year and approaching me all time highs. So

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Speaker 1: I think they're in a pretty good place. Sarah, great

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Speaker 1: to catch. Shall you appreciate your time this morning. I'm

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Speaker 1: sure it's exceptionally busy at a moment for you, Sarah

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Speaker 1: Senate or their Sanford BURNSTA City of Research analyst on McDonald's.

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Speaker 1: There were so many big interviews on Bloomberg Television, in

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Speaker 1: particular Friday, Larry Cudlow, Rich Clarida and how speaker Nancy Pelosi,

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Speaker 1: who spoke with our own David Weston, host of Bloomberg

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Speaker 1: Balance of Power and and really it was a newsmaking

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Speaker 1: UH interview that drove the narrative. Over the weekend, we

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Speaker 1: had impeachment discussions as well as Nancy Pelosi's take on

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Speaker 1: the election taste. Take a listen to a snippet of

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Speaker 1: what she had to say. I'm not a big fan

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Speaker 1: of Medicare for all. I mean, I welcome the debate.

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Speaker 1: I think that we should have health care for all.

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Speaker 1: I think that the Affordable Care benefit is better than

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Speaker 1: the medic Gear benefit. But we have invited UH advocates

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Speaker 1: for it to testify in Congress in the ways the

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Speaker 1: Mains Committee, in the Budget Committee, and the Rules Committee

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Speaker 1: being respectful of the point of view. But it is expensive.

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Speaker 1: UM who pays is very important. What are the benefits

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Speaker 1: that come in there? So I would I would think

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Speaker 1: that hopefully as we emerge into the election year, the

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Speaker 1: mantra will be more health care for all Americans, because

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Speaker 1: there is a comfort level that some people have with

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Speaker 1: their current private insurance that they have, and if that

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Speaker 1: is to be phased out, let's talk about it. But

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Speaker 1: let's not just have one bill that would do that.

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Speaker 1: That was how speaker at Nancy Pelosi speaking on Friday

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Speaker 1: with our own David Weston, who joins us here in

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Speaker 1: our Bloomberg Atta Active Broker Studios. David, there seems a

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Speaker 1: sort of racing frustration around healthcare with Democrats. On one hand,

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00:23:04,880 --> 00:23:07,879
Speaker 1: it's an incredibly important issue for them to address. On

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Speaker 1: the other there is very little agreement among the candidates

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Speaker 1: of exactly how to go about fixing the problem that

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Speaker 1: a lot of people agree upon. Can you give us

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Speaker 1: a sense of why this is the issue that's front

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Speaker 1: and center for the Democrats. Well, first and foremost, it

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00:23:21,320 --> 00:23:23,680
Speaker 1: is so terribly important to the American people. Every single

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Speaker 1: poll tells your healthcare is right up at the top.

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Speaker 1: So it's a very important issue. You have to remember

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Speaker 1: in the midterm elections. Back in two thousand eighteen, uh

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Speaker 1: Nancy Pelosi got a majority of Democrats in the House

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Speaker 1: by saying, watch out, Donald Trump is going to take

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Speaker 1: away your healthcare. People are scared of Donald Trump. The

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00:23:39,240 --> 00:23:41,320
Speaker 1: challenge she's got now is you just heard the end

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Speaker 1: of that clip, or saying wait a second, if we're

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Speaker 1: taking away health insurance for people, then people may be

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Speaker 1: scared of the Democrats, they may take an advantage in

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Speaker 1: turn into a disadvantage. I think that's part of what

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Speaker 1: she's concerned about. So, David, what does Speaker Pelosi say

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Speaker 1: as relates to the upcoming election? Is such a crowded

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Speaker 1: democratic field, how does she view this thing is going

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00:23:58,440 --> 00:24:01,000
Speaker 1: to play out? Well, she's very careful and not picking

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00:24:01,080 --> 00:24:04,520
Speaker 1: winners and losers, although in that interview she purely clearly

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00:24:04,640 --> 00:24:07,359
Speaker 1: conveyed a sense that we better not go too far left.

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Speaker 1: I asked her specifically, you're gonna win the electoral college

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Speaker 1: with Medicare for all, and she said, that's not going

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Speaker 1: to help across the country. Maybe my homes, my home

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00:24:14,320 --> 00:24:16,600
Speaker 1: district of San Francisco, but not otherwise. But you have

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Speaker 1: to remember, Nancy Polois is a Speaker of the House.

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Speaker 1: When you say the election, she doesn't just think the president.

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Speaker 1: She thinks about what happens the Democrats in the House. So,

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Speaker 1: for that matter, is there a chance of taking the Senate?

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Speaker 1: And I think part of what she's concerned about is

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Speaker 1: if you go too far progressive or left, you may

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Speaker 1: not only lose the Presidence, you might lose the House.

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Speaker 1: I'm struggling to understand how potent healthcare is the primary

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Speaker 1: issue in a debate, is I mean, yes, people want

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Speaker 1: their health care. But I feel like they're preaching to

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Speaker 1: the choir, aren't they when it comes to Democrats trying

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00:24:47,200 --> 00:24:51,840
Speaker 1: to recruit Democrats not necessarily President Trump's supporters. Yeah, sure,

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Speaker 1: I mean it work'd worked for them, as I said

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00:24:53,240 --> 00:24:55,200
Speaker 1: in two And you also have to think, what else

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00:24:55,240 --> 00:24:57,399
Speaker 1: do they have. One of the things we talked about

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00:24:57,600 --> 00:25:00,520
Speaker 1: was the economy is not doing that badly. We're still growing.

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Speaker 1: Maybe it's two percent, but we're still growing. Unemployment is

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00:25:03,359 --> 00:25:05,560
Speaker 1: close to a fifty year low. How do you go

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00:25:05,800 --> 00:25:08,320
Speaker 1: to the Trump voter from two sixteen and say you

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00:25:08,359 --> 00:25:11,159
Speaker 1: should switch your vote now because of the economy. It's

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00:25:11,200 --> 00:25:13,119
Speaker 1: a pretty hard argument to make. Now, she tries to

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00:25:13,160 --> 00:25:15,160
Speaker 1: make up. I think it's got to be distributed differently,

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00:25:15,880 --> 00:25:17,800
Speaker 1: But it's a little bit hard to say the economy

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00:25:17,880 --> 00:25:22,200
Speaker 1: really is in a ditch. So what did speaker close?

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00:25:22,240 --> 00:25:23,920
Speaker 1: They have to say on appeachment is such a moving

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00:25:24,280 --> 00:25:26,560
Speaker 1: target here, but it looks like they maybe want to

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Speaker 1: get something done by Christmas. Yeah, she she really said

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Speaker 1: Number one, I'm not for impeachment. I didn't want this

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00:25:32,040 --> 00:25:33,639
Speaker 1: to go forward, and we all knew that, but she

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00:25:33,840 --> 00:25:35,680
Speaker 1: said it. I didn't want to go forward. But when

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00:25:35,800 --> 00:25:38,879
Speaker 1: she saw the transcript of that, or the modified transcript

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00:25:38,920 --> 00:25:42,280
Speaker 1: of the conversation between President Trump and President Zelinski of Ukraine,

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00:25:42,520 --> 00:25:43,960
Speaker 1: she said, we had no choice. At that point, it

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00:25:44,000 --> 00:25:46,520
Speaker 1: was absolutely clear. And this is not about politics, she

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00:25:46,560 --> 00:25:49,000
Speaker 1: would say, and she did say, it's not about politics,

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00:25:49,080 --> 00:25:52,280
Speaker 1: whatever the consequences. I have an oath to defend the constitution.

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00:25:52,359 --> 00:25:55,440
Speaker 1: What the president was doing there violates the Constitution. It's

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00:25:55,440 --> 00:25:58,840
Speaker 1: an abusive power. How optimistic does she seem about the

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00:25:59,520 --> 00:26:03,440
Speaker 1: election for the Democrats. Well, you know, that's a very

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00:26:03,480 --> 00:26:06,440
Speaker 1: good question, Lisa, she doesn't convey it that way. Of course,

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00:26:06,520 --> 00:26:08,720
Speaker 1: she's optimistic. She says that they will do well. Okay,

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00:26:08,760 --> 00:26:13,239
Speaker 1: but why does she really feel I think she feels. Uh,

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00:26:13,600 --> 00:26:15,720
Speaker 1: I'm speaking for her. This is not what she said. Okay,

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00:26:15,760 --> 00:26:18,840
Speaker 1: So this is presumptus on my part. I think, as

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00:26:19,080 --> 00:26:22,760
Speaker 1: she says, a card carrying liberal from San Francisco, who

509
00:26:22,880 --> 00:26:25,440
Speaker 1: normally would want to go with the left, she sees

510
00:26:25,520 --> 00:26:27,600
Speaker 1: that as a dangerous route. I think it's what I

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00:26:27,720 --> 00:26:29,960
Speaker 1: infer from what she's saying, that they have to be

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00:26:30,119 --> 00:26:32,920
Speaker 1: very careful about that. Uh. If they are going to

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00:26:33,320 --> 00:26:37,200
Speaker 1: maintain or increase their position in that. In fact, a

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00:26:37,320 --> 00:26:38,840
Speaker 1: lot of people are more in the center. And listen,

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00:26:38,960 --> 00:26:42,000
Speaker 1: we know that. Look at the key district. It is Wisconsin,

516
00:26:42,200 --> 00:26:45,000
Speaker 1: it is Michigan, it is Pennsylvania. It's not San Francisco.

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00:26:45,119 --> 00:26:47,119
Speaker 1: It's not the Upper East Side of New York that

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00:26:47,240 --> 00:26:49,359
Speaker 1: she's got to be fighting for. It's such an interesting

519
00:26:49,440 --> 00:26:51,760
Speaker 1: time to report be reporting on politics right now. It's

520
00:26:51,840 --> 00:26:53,960
Speaker 1: very hard for me to get a sense of what

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00:26:54,119 --> 00:26:57,280
Speaker 1: people talk about behind the headlines and how much support

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00:26:57,359 --> 00:26:59,720
Speaker 1: there is of some of the current policies and how

523
00:27:00,160 --> 00:27:02,760
Speaker 1: isolated President Trump is or frankly, how much support he

524
00:27:02,840 --> 00:27:05,760
Speaker 1: has by his own Republican Party. I'm just struggling to

525
00:27:05,840 --> 00:27:09,520
Speaker 1: understand these three campaign events this week. You'll be going

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00:27:09,560 --> 00:27:12,560
Speaker 1: through the South for three. But but interesting part of

527
00:27:12,600 --> 00:27:15,679
Speaker 1: that is because the state of Mississippi now might actually

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00:27:15,760 --> 00:27:18,639
Speaker 1: conceivably like the Democrat as governor. There's lieutenant governor right

529
00:27:18,680 --> 00:27:20,840
Speaker 1: there that they are concerned about. You never thought that.

530
00:27:20,880 --> 00:27:23,720
Speaker 1: So he's going to northern Mississippi, which is says something

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00:27:23,720 --> 00:27:25,360
Speaker 1: about how concerned he is about. At the other hand,

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00:27:25,440 --> 00:27:28,240
Speaker 1: I think we underestimate how good a retail person on

533
00:27:28,359 --> 00:27:31,119
Speaker 1: person politician. He is Donald Trump. Did Speaker Ploso, you

534
00:27:31,160 --> 00:27:33,440
Speaker 1: have any senses to the timing of this impeachment because

535
00:27:33,520 --> 00:27:36,200
Speaker 1: it's she's really in charge. She says, it's going to

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00:27:36,280 --> 00:27:38,359
Speaker 1: take as long as it takes h And actually I

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00:27:38,480 --> 00:27:40,439
Speaker 1: asked her, can you limited to Ukraine? She said, that's

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00:27:40,480 --> 00:27:42,160
Speaker 1: what prompted it. Can you limited that because I will

539
00:27:42,160 --> 00:27:43,920
Speaker 1: make it shorter. She said, it's up to the committees.

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00:27:43,920 --> 00:27:45,960
Speaker 1: I can't control that. They might go into all of

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00:27:46,000 --> 00:27:49,240
Speaker 1: those obstruction of justice attempts that Mr Mueller found. They

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00:27:49,320 --> 00:27:51,480
Speaker 1: might go to that, which means we're then into the

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00:27:51,520 --> 00:27:54,199
Speaker 1: primary season next year. David Weston, thank you so much

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00:27:54,200 --> 00:27:56,160
Speaker 1: for being with us and for the terrific interview. Really

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00:27:56,320 --> 00:27:59,960
Speaker 1: uh was definitely a must watch. I recommended David Weston,

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00:28:00,080 --> 00:28:02,760
Speaker 1: host of a Bloomberg Balance of Power, joining us here

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00:28:02,800 --> 00:28:06,040
Speaker 1: in our interactive at Broker Studios. Thanks for listening to

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00:28:06,119 --> 00:28:10,600
Speaker 1: the Bloomberg Surveillance podcast. Subscribe and listen to interviews on

549
00:28:10,680 --> 00:28:16,520
Speaker 1: Apple Podcasts, SoundCloud, or whichever podcast platform you prefer. I'm

550
00:28:16,600 --> 00:28:19,840
Speaker 1: on Twitter at Tom Keene before the podcast. You can

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00:28:19,920 --> 00:28:23,119
Speaker 1: always catch us worldwide. I'm Bloomberg Radio