WEBVTT - Single Best Idea with Tom Keene: Kenneth Rogoff

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<v Speaker 1>Bloomberg Audio Studios, podcasts, radio news.

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<v Speaker 2>What an interesting day in the market. It's quiet economic

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<v Speaker 2>day at retail sales tomorrow. The CPI was yesterday, but

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<v Speaker 2>it is a shocking two day lift in the markets

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<v Speaker 2>and even green on the screen here this morning. We'll

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<v Speaker 2>see how we end up through the day in the

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<v Speaker 2>stock market. We celebrated last week Rick Atkinson with us

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<v Speaker 2>the second volume of his American Revolution. That's a book

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<v Speaker 2>of the summer. I had to go with two books

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<v Speaker 2>of the summer because Ken Rogoff is out with Our Dollar,

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<v Speaker 2>Your Problem, call it my economic book of the summer,

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<v Speaker 2>hugely focused on the dollar and of course our worries

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<v Speaker 2>about debt and deficit. Our dollar, your problem, our debt,

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<v Speaker 2>and your problem here is Ken Rogoff.

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<v Speaker 1>If you believe that it's going to stay on the

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<v Speaker 1>higher side, as I do, you know, debt is very

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<v Speaker 1>high and it does gradually push up interest rates the

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<v Speaker 1>whole world, for better for worse is remilitarizing.

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<v Speaker 3>Populism.

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<v Speaker 1>Deglobalization, which we discussed earlier, also pushes up interest rates.

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<v Speaker 1>All of these things, I think we could easily see

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<v Speaker 1>the ten year at that Now I'm talking about the

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<v Speaker 1>nominal which is now for something like that, we could

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<v Speaker 1>see it at five five six within a couple of years.

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<v Speaker 3>Given how things are going.

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<v Speaker 1>There are some very smart people, young economists, who think, Nope,

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<v Speaker 1>this is an aberration, We're going to go back on

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<v Speaker 1>that downward ride, and debt is a free lunch.

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<v Speaker 3>After all.

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<v Speaker 1>That seems to me a very risky thing to bet

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<v Speaker 1>the farm on.

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<v Speaker 2>In the span of your twenty twenty five What you

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<v Speaker 2>just heard is with that question, one of the great

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<v Speaker 2>outliers of the year. I would suggest an awful lot

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<v Speaker 2>of people I talk to anecdotally, our tendency is towards

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<v Speaker 2>the camp of Ken Rogoff of price down and yield

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<v Speaker 2>up in a five and a half for even six

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<v Speaker 2>percent yield. That's an extraordinary statement by Ken Rogoff and

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<v Speaker 2>is another reason to consider his book Our Dollar Your

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<v Speaker 2>Problem Again, Professor Rogoff on America.

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<v Speaker 3>I think we've hit the peak, and I think you know.

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<v Speaker 3>I don't.

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<v Speaker 1>I'm not an investor, but I would say this is

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<v Speaker 1>a moment to think about diversification more.

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<v Speaker 3>I see Europe with.

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<v Speaker 1>Its forced remilitarization, with its ketchup, probably doing outperforming the

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<v Speaker 1>United States, China.

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<v Speaker 3>Not so much. But it's going to break away from

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<v Speaker 3>the United States.

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<v Speaker 1>Thank you for mentioning Western New York as a wasteland,

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<v Speaker 1>because I actually talk a lot about our joint hometown

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<v Speaker 1>of Rochester quite a bit in the book.

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<v Speaker 3>But I see.

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<v Speaker 1>Certainly the dollars staying on top, but less on top.

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<v Speaker 3>You mentioned Barry Ikinreen. I mean he wrote and many

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<v Speaker 3>of us.

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<v Speaker 1>Thought twenty years ago that we were headed to a

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<v Speaker 1>more tripolar world. I think we're back on course to that.

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<v Speaker 1>We'll lose some of our exceptionalism. It will hurt in

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<v Speaker 1>national security too. There will be other pathways to do transactions.

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<v Speaker 1>Our sanctions won't be as effective, our spying won't be

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<v Speaker 1>as effective, and a number of other things.

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<v Speaker 3>I think Americans are going to have to adjust.

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<v Speaker 1>But I think we're going to have a bit a

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<v Speaker 1>crisis of some sort first, because no politician can rate

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<v Speaker 1>it in until we do that have one kens rugoff.

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<v Speaker 2>It's a remarkably slim book. This is not four hundred

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<v Speaker 2>or eight hundred pages like Rick Atkinson's American Revolution Treatment.

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<v Speaker 2>This is a blistering two hundred and fifty or so pages.

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<v Speaker 2>Our dollar, your problem. I won't miss words that you

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<v Speaker 2>got a kid this summer and they're whining about their

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<v Speaker 2>board and they need something to read. Throw our dollar,

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<v Speaker 2>your problem at them, and it is a really scintillating

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<v Speaker 2>look back over twenty thirty forty years and then forward

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<v Speaker 2>to the next America. This is a single best idea.

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<v Speaker 2>We're right on YouTube podcast and of course commute across

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<v Speaker 2>the nation and again single best idea.