1 00:00:00,080 --> 00:00:13,040 Speaker 1: Ye. Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keene 2 00:00:13,480 --> 00:00:17,560 Speaker 1: Jay Leye. We bring you insight from the best in economics, finance, investment, 3 00:00:18,000 --> 00:00:23,520 Speaker 1: and international relations. Find Bloomberg Surveillance on Apple Podcasts, SoundCloud, 4 00:00:23,600 --> 00:00:32,800 Speaker 1: Bloomberg dot Com, and of course, on the Bloomberg So One. 5 00:00:32,800 --> 00:00:35,360 Speaker 1: Are the top stories overnight. Let's begin that the President 6 00:00:35,400 --> 00:00:37,800 Speaker 1: walking out of his second summit with Kim john n 7 00:00:38,159 --> 00:00:40,320 Speaker 1: after the two leaders could not agree on a deal 8 00:00:40,360 --> 00:00:43,520 Speaker 1: to relieve North Korea of U S sanctions in exchange 9 00:00:43,520 --> 00:00:46,440 Speaker 1: for giving up much of its nuclear weapons program. Here's 10 00:00:46,440 --> 00:00:49,519 Speaker 1: the President of the United States. We had some options, 11 00:00:49,520 --> 00:00:51,479 Speaker 1: and at this time we decided not to do any 12 00:00:51,520 --> 00:00:54,120 Speaker 1: of the options. And we'll see where that goes. But 13 00:00:54,240 --> 00:00:57,240 Speaker 1: it was it was a very interesting two days, and 14 00:00:57,280 --> 00:00:59,680 Speaker 1: I think actually it was a very productive two days. 15 00:00:59,680 --> 00:01:03,200 Speaker 1: But sometimes you have to walk, and this was just 16 00:01:03,280 --> 00:01:06,040 Speaker 1: one of those times. Sometimes you have to walk, and 17 00:01:06,120 --> 00:01:08,040 Speaker 1: this was just one of those times. Joining us now 18 00:01:08,080 --> 00:01:12,680 Speaker 1: from Hanno with Vietnam. It's bloom Bug's chief Washington correspondent, Kevin, Sir, Really, Kevin, 19 00:01:12,760 --> 00:01:16,000 Speaker 1: if it was productive, what exactly did we achieve? Well, 20 00:01:16,040 --> 00:01:18,480 Speaker 1: I'm not sure that it was productive, and in fact, 21 00:01:18,560 --> 00:01:20,680 Speaker 1: even the President himself at the press conference a couple 22 00:01:20,720 --> 00:01:24,480 Speaker 1: of hours ago, said that he was disappointed that that 23 00:01:24,720 --> 00:01:28,560 Speaker 1: these talks, which had been really trending rhetorically speaking, quite 24 00:01:28,560 --> 00:01:31,440 Speaker 1: positively in the twenty four hours leading into this, but 25 00:01:31,560 --> 00:01:34,240 Speaker 1: ultimately the day was cut short two hours worth. They 26 00:01:34,240 --> 00:01:36,880 Speaker 1: were supposed to have, like a joint signing agreement. There 27 00:01:36,920 --> 00:01:39,039 Speaker 1: was speculation there was going to be a formal ending 28 00:01:39,040 --> 00:01:42,360 Speaker 1: of the Korean War following the ceasefire of nine three. 29 00:01:42,400 --> 00:01:46,080 Speaker 1: But Jonathan, this was not the deal at all or 30 00:01:46,120 --> 00:01:48,960 Speaker 1: the day rather that President Trump was hoping to have. 31 00:01:49,560 --> 00:01:51,880 Speaker 1: And currently as we speak, he's flying aboard Air Force 32 00:01:51,920 --> 00:01:54,360 Speaker 1: one back state side. And we all know the storyline 33 00:01:54,360 --> 00:01:57,480 Speaker 1: there with Michael, So Kevin, let's talk about how typically 34 00:01:57,560 --> 00:02:00,840 Speaker 1: these things play out. Typically, the outcome of summits like 35 00:02:00,920 --> 00:02:03,720 Speaker 1: this a predetermined before the president even boards Air Force 36 00:02:03,800 --> 00:02:06,360 Speaker 1: one at leaves the White House. This is a very 37 00:02:06,360 --> 00:02:10,720 Speaker 1: different approach negotiations with foreign leaders, isn't it? It absolutely is. 38 00:02:10,760 --> 00:02:13,160 Speaker 1: And and and even just in texting and emailing with 39 00:02:13,520 --> 00:02:17,519 Speaker 1: analyst backstate side since the press conference, I mean, Jonathan, 40 00:02:18,040 --> 00:02:21,520 Speaker 1: there's an ability, there's there's the level of unpredictability. That 41 00:02:21,560 --> 00:02:24,520 Speaker 1: I remember President Trump, then Candidate Trump would talk about 42 00:02:24,520 --> 00:02:26,919 Speaker 1: on the campaign trail, but he wanted to be unpredictable, 43 00:02:26,960 --> 00:02:29,960 Speaker 1: and we've seen that play out virtually in real time 44 00:02:30,080 --> 00:02:34,280 Speaker 1: here in Hanoi. But but these analysts are criticizing that 45 00:02:34,400 --> 00:02:39,200 Speaker 1: same approach because now there's no step forward in terms 46 00:02:39,280 --> 00:02:42,360 Speaker 1: of the nuclearization, in terms of defining the nuclearization, or 47 00:02:42,360 --> 00:02:45,040 Speaker 1: in terms of bringing the Russians and the Chinese to 48 00:02:45,160 --> 00:02:48,160 Speaker 1: the table to get folks to the nuclearize. Kevin, since 49 00:02:48,200 --> 00:02:49,799 Speaker 1: I last spoke to you an hour and a half ago, 50 00:02:49,840 --> 00:02:52,280 Speaker 1: I'm sure you've taken tea at the Metropole Hotel in 51 00:02:52,320 --> 00:02:57,320 Speaker 1: Hanoi before you wander back to America. Vietnamese coffee, Vietnamese coffee. 52 00:02:57,320 --> 00:02:59,160 Speaker 1: But you know there's a spin to this and all 53 00:02:59,240 --> 00:03:03,520 Speaker 1: that everybody he's adapting and adjusting. The fact is, it 54 00:03:03,720 --> 00:03:07,679 Speaker 1: is stunning the difference in two tweets from the one 55 00:03:07,720 --> 00:03:11,480 Speaker 1: this morning by the President finessing the moment versus what 56 00:03:11,560 --> 00:03:15,320 Speaker 1: I saw nineteen hours ago, maybe twenty hours ago, of 57 00:03:15,360 --> 00:03:19,320 Speaker 1: a happy, happy, shaking hands pat on the shaking hands thing. 58 00:03:19,880 --> 00:03:23,840 Speaker 1: I mean, those images are stark. How will the president 59 00:03:24,480 --> 00:03:28,400 Speaker 1: massage that message when he lands at Andrew's Air Force Base. 60 00:03:28,720 --> 00:03:30,720 Speaker 1: You know, it's it, that's that's the task ahead. I mean, 61 00:03:30,720 --> 00:03:33,519 Speaker 1: there's this plant in North Korea, this nuclear plant called 62 00:03:33,600 --> 00:03:37,120 Speaker 1: Young Young Young, which is a nuclear plant that that 63 00:03:37,160 --> 00:03:39,760 Speaker 1: has really gotten a lot of attention for a nuclear 64 00:03:39,800 --> 00:03:42,840 Speaker 1: development site. But the President in his press conference Tom 65 00:03:42,920 --> 00:03:48,200 Speaker 1: also said that they displayed evidence of intelligence that there 66 00:03:48,200 --> 00:03:51,280 Speaker 1: were other nuclearar sites in North Korea, and that caught 67 00:03:51,280 --> 00:03:54,600 Speaker 1: the North Korean's, according to President Trump and Secretary Pompeo, 68 00:03:54,720 --> 00:03:59,400 Speaker 1: a bit off guard. And so now, uh, the thirty 69 00:03:59,440 --> 00:04:02,360 Speaker 1: five year old dictator from North Korea, he's gonna stick 70 00:04:02,360 --> 00:04:04,800 Speaker 1: around here in Hanoi for he's supposed to at least 71 00:04:04,840 --> 00:04:08,760 Speaker 1: for another twenty four hours or so. Uh and presumably 72 00:04:08,840 --> 00:04:10,880 Speaker 1: is going to be meeting with the Chinese president. She 73 00:04:11,040 --> 00:04:14,320 Speaker 1: has already dispatched his foreign minister to meet with the 74 00:04:14,360 --> 00:04:19,320 Speaker 1: North Koreans. Mind you, the Chinese presence here in Hannoy 75 00:04:19,760 --> 00:04:22,680 Speaker 1: was you felt it? Uh? And And and to Jonathan's 76 00:04:22,680 --> 00:04:25,800 Speaker 1: earlier point, the summit that I covered in Singapore had 77 00:04:25,800 --> 00:04:30,880 Speaker 1: a much different feel. I mean, what was difference between 78 00:04:31,360 --> 00:04:35,480 Speaker 1: Singapore and Hannoi besides a hotel food? You know, I'll 79 00:04:35,520 --> 00:04:37,680 Speaker 1: put it simple. I mean to use your lingo. They 80 00:04:37,680 --> 00:04:40,320 Speaker 1: didn't rip up the script in Singapore, they stuck to 81 00:04:40,520 --> 00:04:43,719 Speaker 1: the script. Here in Hanoi, they ripped up the script 82 00:04:43,720 --> 00:04:46,360 Speaker 1: there was There wasn't even a script to rip up from. 83 00:04:46,400 --> 00:04:49,960 Speaker 1: From the moment that Uh Kim Kim Jong un took 84 00:04:50,000 --> 00:04:53,719 Speaker 1: that stepped off that sixty hour Chinese arranged train ride 85 00:04:54,360 --> 00:04:58,839 Speaker 1: uh and arrived at the hotel and kicked out the 86 00:04:58,839 --> 00:05:01,760 Speaker 1: White House press pool. You could tell this was a 87 00:05:01,839 --> 00:05:04,760 Speaker 1: much different feel. Kevin, thank you so much, Kevin SURREALI 88 00:05:04,839 --> 00:05:08,240 Speaker 1: he will be in Hannoy for his important effort tonight 89 00:05:08,360 --> 00:05:13,800 Speaker 1: five pm nationwide soundown with Kevin Surreally driving before now. Yeah, well, 90 00:05:13,839 --> 00:05:15,680 Speaker 1: you know it's Thursday and we're cutting near to the 91 00:05:15,720 --> 00:05:18,599 Speaker 1: real you'd a tough way. I don't have anything to plug. 92 00:05:18,720 --> 00:05:20,840 Speaker 1: But anyways, let's just really in Hannoy and he will 93 00:05:20,880 --> 00:05:24,280 Speaker 1: give you unique perspective that you will see off the 94 00:05:24,279 --> 00:05:40,840 Speaker 1: Washington studio. But nationwide, we've got a lot to talk 95 00:05:40,880 --> 00:05:43,440 Speaker 1: about today. Let's bring in Chris Grassanti Show with Grossanti 96 00:05:43,480 --> 00:05:47,480 Speaker 1: Capital Management CEO. There are some positives to the unpredictable 97 00:05:47,560 --> 00:05:49,360 Speaker 1: nature of the President of the United States. You can 98 00:05:49,400 --> 00:05:51,039 Speaker 1: get the Chinese to the table in a way that 99 00:05:51,080 --> 00:05:53,280 Speaker 1: other people haven't been able to. Chris, there is the 100 00:05:53,480 --> 00:05:57,720 Speaker 1: downside as well, as we mentioned previously. Typically these are 101 00:05:57,760 --> 00:06:02,159 Speaker 1: predetermined summits. Before you get the outcome has already been decided. 102 00:06:02,720 --> 00:06:05,279 Speaker 1: This is some of the downside from other night, isn't it. Yeah? 103 00:06:05,400 --> 00:06:08,240 Speaker 1: Thanks so, Jonathan forgive me for being a little bit cynical. 104 00:06:08,320 --> 00:06:10,920 Speaker 1: But as far as the President's concerned, we're sitting here 105 00:06:10,960 --> 00:06:14,960 Speaker 1: talking about North Korea instead of talking about Cohen, right, 106 00:06:15,120 --> 00:06:17,800 Speaker 1: so his little bit of drama at the summit is 107 00:06:17,839 --> 00:06:23,039 Speaker 1: probably not so counterproductive as as we might think. Um, 108 00:06:23,120 --> 00:06:25,840 Speaker 1: what I would say is China, as we we looked 109 00:06:25,839 --> 00:06:28,360 Speaker 1: at the China trade dada this morning, when I talke 110 00:06:28,440 --> 00:06:31,559 Speaker 1: about it's just a disaster, I mean it's really ugly. 111 00:06:31,880 --> 00:06:35,240 Speaker 1: So but that that perversely maybe kind of good news 112 00:06:35,279 --> 00:06:38,240 Speaker 1: because what that says is the Chinese need a trade deal. 113 00:06:38,279 --> 00:06:40,400 Speaker 1: They needed badly. So for anyone that missed the data 114 00:06:40,480 --> 00:06:42,960 Speaker 1: from overnight Chinese manufacturing, the p M I coming at 115 00:06:42,960 --> 00:06:46,159 Speaker 1: a forty nine point too. I was going to wait 116 00:06:46,240 --> 00:06:48,560 Speaker 1: this letter and we'll revamp this at five things you 117 00:06:48,640 --> 00:06:50,919 Speaker 1: need to know, And thank you Interact of Brokers for 118 00:06:50,960 --> 00:06:57,760 Speaker 1: that support. Chris John Ferrell absolutely nailed the slope, the 119 00:06:57,880 --> 00:07:01,320 Speaker 1: gradient of this p m I X words out of China. 120 00:07:02,080 --> 00:07:04,400 Speaker 1: I mean, it was extraordinary. What you did? What you 121 00:07:04,400 --> 00:07:11,040 Speaker 1: what do you? No? Can I just say there is 122 00:07:11,040 --> 00:07:13,520 Speaker 1: a silver lining in this very ugly p m The 123 00:07:13,680 --> 00:07:16,320 Speaker 1: slope is a generous ur It's like a black diamonds. 124 00:07:16,360 --> 00:07:18,200 Speaker 1: There is there is a there is a silver lining 125 00:07:18,360 --> 00:07:20,600 Speaker 1: in this p m I. From overnight in China, the 126 00:07:20,640 --> 00:07:24,560 Speaker 1: business activity expectation component was actually really positive for both 127 00:07:24,600 --> 00:07:27,320 Speaker 1: the manufacturing p m I the non manufacturing p m I. 128 00:07:27,760 --> 00:07:30,040 Speaker 1: The other piece of good news I have to say 129 00:07:30,240 --> 00:07:33,440 Speaker 1: is that the input prices for this p m I 130 00:07:33,480 --> 00:07:36,400 Speaker 1: as well is in positive territory. There was a concern 131 00:07:36,480 --> 00:07:39,960 Speaker 1: that we'd have that twenty sixteen replay of exporting disinflation. 132 00:07:40,320 --> 00:07:41,920 Speaker 1: But I've really got to look for this, Chris, You've 133 00:07:41,960 --> 00:07:45,280 Speaker 1: really got to look hard to find some positivity. So 134 00:07:45,280 --> 00:07:47,240 Speaker 1: so my real question for the rest of this year, 135 00:07:47,240 --> 00:07:50,360 Speaker 1: and I think this is where it starts. February you 136 00:07:50,480 --> 00:07:53,040 Speaker 1: had a big Chinese holiday. It's really really difficult to 137 00:07:53,040 --> 00:07:55,440 Speaker 1: get a clear read on the Chinese economy. We go 138 00:07:55,480 --> 00:07:58,000 Speaker 1: into March, we're gonna get some clean data, probably from China, 139 00:07:58,040 --> 00:08:00,880 Speaker 1: from the United States as well, and big question for 140 00:08:00,920 --> 00:08:02,280 Speaker 1: this year, and I think it holds the key to 141 00:08:02,360 --> 00:08:07,920 Speaker 1: asset classes for can stimulus out of China bite? When 142 00:08:07,920 --> 00:08:10,160 Speaker 1: does it bite? And how much support does it offer 143 00:08:10,200 --> 00:08:12,320 Speaker 1: this economy because I'm not saying much of it right now, 144 00:08:12,520 --> 00:08:14,560 Speaker 1: and I think you need a two barrel approach. You 145 00:08:14,600 --> 00:08:16,840 Speaker 1: need the stimulus that has to work, and you need 146 00:08:16,880 --> 00:08:19,720 Speaker 1: a trade resolution, at least a temporary one to get 147 00:08:19,760 --> 00:08:22,400 Speaker 1: us through the summer. Until that is the value Man 148 00:08:22,440 --> 00:08:27,520 Speaker 1: optimistic about financial markets because we have ripped through so far. Absolutely, 149 00:08:27,760 --> 00:08:29,800 Speaker 1: I mean we have to be a lot more selective now. 150 00:08:29,840 --> 00:08:32,360 Speaker 1: There were some terrific bargains the last week of the year, 151 00:08:32,400 --> 00:08:34,880 Speaker 1: but you know we're up almost fifteen per cent since then. 152 00:08:35,160 --> 00:08:37,440 Speaker 1: One place that does still seem to have value our 153 00:08:37,600 --> 00:08:41,920 Speaker 1: financial stocks. They haven't risen because rates have been benign. 154 00:08:42,200 --> 00:08:45,080 Speaker 1: If rates, as we think, will start to ease higher again, 155 00:08:45,320 --> 00:08:47,440 Speaker 1: you could get us some bids in the banks. I 156 00:08:47,480 --> 00:08:49,680 Speaker 1: mean in Europe, I mean one of the other changes 157 00:08:49,760 --> 00:08:52,160 Speaker 1: John quickly here that we've seen as German tenure yield 158 00:08:52,240 --> 00:08:54,679 Speaker 1: is finally lifted up, I mean a little bit off 159 00:08:54,720 --> 00:08:56,920 Speaker 1: the mat in the last three days. Are you in 160 00:08:56,960 --> 00:09:00,640 Speaker 1: Europe at all no, you know we we the opportunities 161 00:09:00,640 --> 00:09:06,000 Speaker 1: in the United States is higher growth and less risk. Okay, Christmas, Chris, 162 00:09:06,280 --> 00:09:26,319 Speaker 1: thank you so much. Morning, just extraordinary morning. This is 163 00:09:26,360 --> 00:09:28,400 Speaker 1: a joy. This is what we like to do best. 164 00:09:28,400 --> 00:09:30,480 Speaker 1: On surveillance. It may be on the markets. That may 165 00:09:30,480 --> 00:09:33,360 Speaker 1: be on foreign exchange or bonds. It may be some 166 00:09:33,480 --> 00:09:39,880 Speaker 1: fancy economists to define a definitive voice. Lisa Collins is extraordinary. 167 00:09:39,960 --> 00:09:43,200 Speaker 1: She's out of Oberlin and is pieced together in a 168 00:09:43,400 --> 00:09:49,080 Speaker 1: shockingly short amount of time definitive knowledge on their hermit kingdom. 169 00:09:49,160 --> 00:09:50,960 Speaker 1: You know the photo. I think I saw it in 170 00:09:50,960 --> 00:09:54,320 Speaker 1: the Boston Globe a million years ago of Asia lit 171 00:09:54,400 --> 00:09:57,240 Speaker 1: up this photo from the satellites, and there was North 172 00:09:57,320 --> 00:10:01,800 Speaker 1: to create Korea dark and black. She owns with Victor 173 00:10:01,960 --> 00:10:07,240 Speaker 1: Cha the granularity of the economy and the political system 174 00:10:07,360 --> 00:10:11,160 Speaker 1: of North Korea. And we welcome Lisa Collins with the 175 00:10:11,240 --> 00:10:14,960 Speaker 1: Center for Strategic and International Studies. Lisa, if you could 176 00:10:15,000 --> 00:10:19,280 Speaker 1: say to our audience the one thing about the stereotype 177 00:10:20,280 --> 00:10:26,160 Speaker 1: of medieval North Korea, what do we most get wrong? Well, 178 00:10:26,200 --> 00:10:30,120 Speaker 1: I think we get wrong that there are people inside 179 00:10:30,120 --> 00:10:33,720 Speaker 1: the country who are trying to live their lives the 180 00:10:33,760 --> 00:10:36,120 Speaker 1: best that they can there. You know, they are trying 181 00:10:36,160 --> 00:10:39,840 Speaker 1: to UM use their own agency to create better lives 182 00:10:39,960 --> 00:10:42,400 Speaker 1: and to create these markets that you've just talked about. 183 00:10:42,800 --> 00:10:45,640 Speaker 1: UM And despite the repression that's happening inside the country, 184 00:10:45,640 --> 00:10:48,360 Speaker 1: which Kim Jongan has tried very hard to keep the 185 00:10:48,400 --> 00:10:51,120 Speaker 1: people from doing, UM is creating these markets. That is, 186 00:10:51,120 --> 00:10:53,480 Speaker 1: they're living on their own terms and they're trying to 187 00:10:53,480 --> 00:10:55,679 Speaker 1: survive the best that they can do. They want to 188 00:10:55,720 --> 00:10:59,280 Speaker 1: go across the d m Z or go north across 189 00:10:59,440 --> 00:11:03,080 Speaker 1: the river Peter Hessler and Oracle Bones riding that river 190 00:11:03,280 --> 00:11:06,080 Speaker 1: years ago. Do they want to go north or south 191 00:11:06,200 --> 00:11:09,560 Speaker 1: and escape? Some of them do. Some of them have 192 00:11:09,600 --> 00:11:12,920 Speaker 1: tried multiple times to leave the country. They've either been 193 00:11:13,000 --> 00:11:15,920 Speaker 1: captured and returned to the country and are being held 194 00:11:15,920 --> 00:11:19,720 Speaker 1: in prison camps or in jail. UM and others are 195 00:11:19,800 --> 00:11:22,080 Speaker 1: quite content to stay inside their country and try to 196 00:11:22,120 --> 00:11:25,839 Speaker 1: profit from the markets, try to make again UM living 197 00:11:25,880 --> 00:11:29,120 Speaker 1: for themselves and for their families outside of the reach 198 00:11:29,160 --> 00:11:33,600 Speaker 1: of the government. Interpret forest. The outrage over, you know, 199 00:11:33,640 --> 00:11:37,320 Speaker 1: the language is intense about the human rights violation of 200 00:11:37,400 --> 00:11:40,480 Speaker 1: Chairman Kim and the rest of it all. Is it 201 00:11:40,679 --> 00:11:44,400 Speaker 1: legitimate of the human rights people done their homework and 202 00:11:44,440 --> 00:11:49,040 Speaker 1: they are looking at outrageous conditions. Certainly. I mean, this 203 00:11:49,080 --> 00:11:52,280 Speaker 1: has been going on for sixty seventy years. It wasn't 204 00:11:52,360 --> 00:11:54,880 Speaker 1: just something that happened under Kim jonga, and it's been 205 00:11:54,920 --> 00:11:58,720 Speaker 1: happening under his grandfather and his father. Um, they built 206 00:11:58,720 --> 00:12:01,839 Speaker 1: these prison camps, He's pulled prison camps when the nation 207 00:12:01,960 --> 00:12:05,079 Speaker 1: was first founded. They are very much like the Russian 208 00:12:05,080 --> 00:12:07,760 Speaker 1: gulags or the Soviet Union gulags, and some in some 209 00:12:07,800 --> 00:12:12,320 Speaker 1: cases are probably worse. Um. There was a Special Commission 210 00:12:12,360 --> 00:12:15,000 Speaker 1: of Inquiry that was formed by the United Nations in 211 00:12:15,040 --> 00:12:17,880 Speaker 1: two thousand fourteen which did an extensive study on all 212 00:12:17,880 --> 00:12:20,080 Speaker 1: of North Korea's human rights violations, came out with a 213 00:12:20,080 --> 00:12:22,439 Speaker 1: great report at the end of two thousands, at the 214 00:12:22,480 --> 00:12:25,240 Speaker 1: beginning of two thousand fourteen, and it basically lists all 215 00:12:25,280 --> 00:12:27,480 Speaker 1: of these horrendous things that have been happening. If you're 216 00:12:27,520 --> 00:12:29,760 Speaker 1: just joining us today, without question, my interview of the 217 00:12:29,840 --> 00:12:33,320 Speaker 1: day on North Korea, Lisa Collins with this a fellow 218 00:12:33,400 --> 00:12:37,040 Speaker 1: Korea chair at the Center for Strategic and International Studies. 219 00:12:37,040 --> 00:12:40,440 Speaker 1: I put out on Twitter her website at c s 220 00:12:40,480 --> 00:12:44,480 Speaker 1: i S and it's just absolutely definitive. Okay, the president 221 00:12:44,760 --> 00:12:48,880 Speaker 1: with his work today, Lisa. The president yesterday with handshakes 222 00:12:49,160 --> 00:12:52,960 Speaker 1: and that famous hand pad that he has with Chairman Kim, 223 00:12:53,000 --> 00:12:56,720 Speaker 1: and the constant theme through it is the President believes 224 00:12:56,760 --> 00:13:02,000 Speaker 1: there can be a tremendous capitalistic oppertu tunity in North Korea. 225 00:13:02,280 --> 00:13:04,760 Speaker 1: Do you agree with the president or how would you 226 00:13:04,840 --> 00:13:09,640 Speaker 1: modify his tone? Well, I think that there certainly is 227 00:13:09,720 --> 00:13:12,880 Speaker 1: opportunity in the long term in North Korea. As has 228 00:13:12,880 --> 00:13:15,480 Speaker 1: been mentioned by many analysts, not just President Trump, but 229 00:13:15,880 --> 00:13:19,320 Speaker 1: North Korea sits at a very opportune location in the 230 00:13:19,320 --> 00:13:22,040 Speaker 1: middle of Northeast Asia, surrounded by some of the greatest 231 00:13:22,200 --> 00:13:25,720 Speaker 1: largest economies in all of Asia even the world. So 232 00:13:25,760 --> 00:13:27,880 Speaker 1: if the country were to open up and were to 233 00:13:28,440 --> 00:13:32,120 Speaker 1: um create a market economy, a regularized market economy, I mean, 234 00:13:32,160 --> 00:13:35,600 Speaker 1: there could be tremendous opportunities, but that is only if 235 00:13:35,640 --> 00:13:38,880 Speaker 1: there is radical political change to cut to the chase, 236 00:13:38,880 --> 00:13:41,319 Speaker 1: and I did a per capita analysis of the communist 237 00:13:41,360 --> 00:13:45,480 Speaker 1: countries of Asia. Can they become a Laos? I mean 238 00:13:45,520 --> 00:13:49,480 Speaker 1: not can they become a Vietnam? But landlocked Laos is 239 00:13:49,960 --> 00:13:54,120 Speaker 1: really struggling. Their goal is a medieval hermit kingdom, is 240 00:13:54,160 --> 00:13:57,199 Speaker 1: to get to Laos. There's Lisa Collins think they can 241 00:13:57,240 --> 00:14:03,040 Speaker 1: get laos forgetting about Vietnam, not not under the current regime. UM, 242 00:14:03,080 --> 00:14:04,959 Speaker 1: and Kim Jong Uan himself would have to make a 243 00:14:05,080 --> 00:14:09,360 Speaker 1: radical change in his strategy of control over the people 244 00:14:09,720 --> 00:14:12,920 Speaker 1: and the markets and the country itself. UM. Under a 245 00:14:12,920 --> 00:14:15,600 Speaker 1: different leader, this may be possible, and over a very 246 00:14:15,640 --> 00:14:19,160 Speaker 1: long period of time, it could potentially be possible, but 247 00:14:19,240 --> 00:14:21,920 Speaker 1: it it might take decades. UM and the South Koreans 248 00:14:21,920 --> 00:14:23,560 Speaker 1: would probably have to help in that. They would have 249 00:14:23,600 --> 00:14:25,840 Speaker 1: to invest a lot. The Chinese would probably want to 250 00:14:25,880 --> 00:14:28,960 Speaker 1: invest more than they already do. UM and the other 251 00:14:29,000 --> 00:14:31,480 Speaker 1: countries in the region, of course, would be involved in 252 00:14:31,800 --> 00:14:34,560 Speaker 1: development as well, Lisa, have we determined that that is 253 00:14:34,600 --> 00:14:39,160 Speaker 1: actually their goal. We we do know that Kim jongan 254 00:14:39,320 --> 00:14:42,520 Speaker 1: is very anxious to develop his country, but on his terms, 255 00:14:42,600 --> 00:14:45,280 Speaker 1: and he's very clearly stated that in all of his 256 00:14:45,360 --> 00:14:50,000 Speaker 1: speeches and and his public statements UM going back for years. 257 00:14:50,440 --> 00:14:52,720 Speaker 1: I think we don't know. What we don't know is 258 00:14:52,720 --> 00:14:55,880 Speaker 1: whether he is willing to open up in the terms 259 00:14:55,880 --> 00:14:57,480 Speaker 1: that the United States and the rest of the Western 260 00:14:57,560 --> 00:14:59,720 Speaker 1: world will like to see North Korea do, and that 261 00:14:59,880 --> 00:15:02,560 Speaker 1: is to follow the model of Vietnam, or even that 262 00:15:02,680 --> 00:15:06,320 Speaker 1: of China where there's slow reform, economic reform, and some 263 00:15:06,360 --> 00:15:10,960 Speaker 1: political opening. Um. Of course, we you know, as Americans, 264 00:15:11,000 --> 00:15:14,760 Speaker 1: we would like to see the entire Korean peninsula become free, democratic, 265 00:15:14,960 --> 00:15:19,960 Speaker 1: and market society. That is the ultimate goal eventually, but um, 266 00:15:20,120 --> 00:15:22,680 Speaker 1: how that happens and whether it can happen under the 267 00:15:22,680 --> 00:15:26,080 Speaker 1: current Crean leadership is is definitely a difficult question. At least, 268 00:15:26,120 --> 00:15:29,520 Speaker 1: it's what degree does an existential threat validate the regime? 269 00:15:31,440 --> 00:15:35,840 Speaker 1: It's a great help to validate their um the rationale 270 00:15:35,840 --> 00:15:38,480 Speaker 1: for keeping control of their people. That's the ultimate reason. 271 00:15:38,480 --> 00:15:41,080 Speaker 1: Which that's the question leads as to why the leader 272 00:15:41,080 --> 00:15:42,800 Speaker 1: of North Korea would actually look for any kind of 273 00:15:42,840 --> 00:15:47,680 Speaker 1: peace deal. Well, so, I think the reason might be 274 00:15:48,120 --> 00:15:50,840 Speaker 1: that if he really is, Kim Jong un is really 275 00:15:50,840 --> 00:15:53,440 Speaker 1: serious about opening up the country, but he's not exactly 276 00:15:53,480 --> 00:15:56,280 Speaker 1: sure how to do it and in what um, you know, 277 00:15:56,320 --> 00:15:58,120 Speaker 1: what steps he needs to take to do that. First, 278 00:15:58,160 --> 00:16:01,480 Speaker 1: he has to change the propaganda within the country. He 279 00:16:01,520 --> 00:16:04,240 Speaker 1: has to change the mindsets of the people, um, who 280 00:16:04,360 --> 00:16:07,600 Speaker 1: have been basically brainwashed over decades. So he has to 281 00:16:07,640 --> 00:16:10,080 Speaker 1: convince them that there's no longer a threat from the 282 00:16:10,160 --> 00:16:14,160 Speaker 1: United States. And then he could probably UM engage in 283 00:16:14,240 --> 00:16:17,880 Speaker 1: some opening diplomatic openings, people to people, more people to 284 00:16:17,960 --> 00:16:21,480 Speaker 1: people exchanges, maybe again the market openings. But you know, 285 00:16:21,600 --> 00:16:25,280 Speaker 1: changing the internal dynamics propaganda of the country is will 286 00:16:25,320 --> 00:16:28,160 Speaker 1: be very difficult. Um. Changing the minds of the elites 287 00:16:28,240 --> 00:16:33,000 Speaker 1: could be very difficult. And then also convincing UM others 288 00:16:33,040 --> 00:16:35,480 Speaker 1: that he the threat from the United States is gone 289 00:16:35,600 --> 00:16:39,120 Speaker 1: is something that he probably faces a large challenge on. So, Lisa, 290 00:16:39,160 --> 00:16:40,920 Speaker 1: from what I'm hearing from you and from the research 291 00:16:40,960 --> 00:16:42,600 Speaker 1: that's been put in front of me from this morning 292 00:16:42,680 --> 00:16:44,680 Speaker 1: from from your team, is that we are a long 293 00:16:44,800 --> 00:16:48,320 Speaker 1: long way away from any kind of final, fully verifiable 294 00:16:48,360 --> 00:16:53,000 Speaker 1: denuclearization deal. Yes, I think there are experts who estimate 295 00:16:53,040 --> 00:16:55,760 Speaker 1: that it could take from ten to fifteen years to 296 00:16:56,440 --> 00:17:00,360 Speaker 1: completely denucarized North Korea all of its sites, even if 297 00:17:00,360 --> 00:17:04,000 Speaker 1: they're being helpful UM and engaged in the process of 298 00:17:04,040 --> 00:17:06,840 Speaker 1: dismantlement of vernicular weapons program. Of course, if they throw 299 00:17:06,920 --> 00:17:10,920 Speaker 1: up roadblocks, walk out of talks, UM, you know, decide 300 00:17:10,960 --> 00:17:14,160 Speaker 1: not to participate in in this process, then it could 301 00:17:14,160 --> 00:17:18,000 Speaker 1: take much longer, if at all. UM. Yeah, so it's 302 00:17:18,000 --> 00:17:21,359 Speaker 1: a very difficult situation. You imagine John and Ivy had 303 00:17:21,400 --> 00:17:24,200 Speaker 1: the privilege of speaking to all sorts of Asia. Heavy 304 00:17:24,240 --> 00:17:27,879 Speaker 1: wis just as one the giant Jonathan Spence of Yale University, 305 00:17:28,720 --> 00:17:34,360 Speaker 1: Lisa Collins, what's it like working with Victor's Chaw? I mean, 306 00:17:34,400 --> 00:17:36,600 Speaker 1: what what is it like working with the dean of 307 00:17:36,640 --> 00:17:40,960 Speaker 1: all of Korea? I mean Dr Chaw's extraordinary right, Yes, 308 00:17:41,040 --> 00:17:46,480 Speaker 1: he is an extraordinary analyst. He is very very well 309 00:17:46,680 --> 00:17:49,800 Speaker 1: versed in Korean affairs. So what gets him upset? What's 310 00:17:49,840 --> 00:17:53,359 Speaker 1: getting you? You and him are sitting around, uh, you know, 311 00:17:53,520 --> 00:17:56,879 Speaker 1: talking up a Korea. What is the topic that the 312 00:17:56,920 --> 00:18:00,199 Speaker 1: two of you get most upset about with in the 313 00:18:00,240 --> 00:18:04,600 Speaker 1: mainstream media on North Korea? Well, I think what is 314 00:18:04,720 --> 00:18:07,520 Speaker 1: upsetting to some degree as the lack of focus on 315 00:18:07,600 --> 00:18:11,600 Speaker 1: human rights. And that's something that he does get him 316 00:18:11,720 --> 00:18:14,320 Speaker 1: UM somewhat disturbed from time to time, and I think 317 00:18:14,359 --> 00:18:16,399 Speaker 1: he tried to write about it in the run up 318 00:18:16,440 --> 00:18:19,280 Speaker 1: to this summit. Is the lack of focus, the lack 319 00:18:19,359 --> 00:18:21,359 Speaker 1: of attention that was being paid to human rights. And 320 00:18:21,400 --> 00:18:24,120 Speaker 1: I think that's something that we hope that will continue 321 00:18:24,160 --> 00:18:28,040 Speaker 1: to get attention um, despite what's going on on the 322 00:18:28,119 --> 00:18:31,800 Speaker 1: demaimalization front or the negotiations. So we should not forget 323 00:18:31,880 --> 00:18:34,240 Speaker 1: that North Korea is still a prison state. It's a 324 00:18:34,320 --> 00:18:38,000 Speaker 1: state that U has to survive by repressing its own people, 325 00:18:38,040 --> 00:18:41,439 Speaker 1: and that there should be movement and openness discussion with 326 00:18:41,480 --> 00:18:44,240 Speaker 1: North Korea about making progress on those fronts at the 327 00:18:44,280 --> 00:18:46,840 Speaker 1: same time that we're also trying to dismantle their nicular 328 00:18:46,840 --> 00:18:50,000 Speaker 1: weapons programs. This is another one hour conversation and we'll 329 00:18:50,000 --> 00:18:52,280 Speaker 1: do that with Lisa Collins that maybe with Dr Shaw 330 00:18:52,320 --> 00:18:56,359 Speaker 1: as we can as well. Just extraordinary and somehow John, 331 00:18:56,400 --> 00:18:59,880 Speaker 1: I think we'll continue with discussion on the Greater Korean 332 00:19:00,280 --> 00:19:03,119 Speaker 1: UH Peninsula was c SIS, a Center for Strategic and 333 00:19:03,200 --> 00:19:19,520 Speaker 1: International Studies. Were thrilled to bringing Lisa Collins. Not enough 334 00:19:19,520 --> 00:19:22,520 Speaker 1: time right now with someone who's joined us before. Catherine 335 00:19:22,560 --> 00:19:26,520 Speaker 1: Moon is at Brookings, but that barely describes her iconic 336 00:19:26,560 --> 00:19:30,800 Speaker 1: position at a small school outside Boston known as Wellesley College. 337 00:19:30,880 --> 00:19:35,120 Speaker 1: To bring up the speed folks. Wellesley College literally pioneered 338 00:19:35,240 --> 00:19:38,919 Speaker 1: Asian studies a zillion years ago. Professor Moon thrilled to 339 00:19:38,960 --> 00:19:42,320 Speaker 1: have you with us UH today if you were if 340 00:19:42,359 --> 00:19:46,080 Speaker 1: you were lecturing freshman at Wellsley. They're so eager to 341 00:19:46,119 --> 00:19:50,520 Speaker 1: get in front of the Asian studies program at Wellesley. 342 00:19:50,560 --> 00:19:53,880 Speaker 1: What's the first thing you would show that that pushes 343 00:19:53,920 --> 00:20:01,080 Speaker 1: against our common myths on Korea, commons against UH commentments 344 00:20:01,160 --> 00:20:04,560 Speaker 1: on North Korea that we need to to unveil. I 345 00:20:04,560 --> 00:20:07,480 Speaker 1: would say the first thing is it's a real country 346 00:20:07,560 --> 00:20:12,320 Speaker 1: that plays hardball diplomatic strategies and has a domestic audience 347 00:20:12,359 --> 00:20:14,719 Speaker 1: that it needs to pay attention to. Even though it's 348 00:20:14,760 --> 00:20:18,639 Speaker 1: a dictatorship. Kim jongan does not run it alone and 349 00:20:18,680 --> 00:20:22,200 Speaker 1: he needs to have the backing of especially the military 350 00:20:22,320 --> 00:20:25,439 Speaker 1: and some members of the population help us with the 351 00:20:25,440 --> 00:20:29,640 Speaker 1: president's constant theme as the summit fell apart in two 352 00:20:29,720 --> 00:20:33,480 Speaker 1: days ago when there was happy handshakes, and the constant 353 00:20:33,520 --> 00:20:36,600 Speaker 1: theme is his belief that North Korea can be a 354 00:20:36,640 --> 00:20:41,840 Speaker 1: force of capitalism going forward. Can it do the Asian 355 00:20:41,920 --> 00:20:45,960 Speaker 1: tiger thing? Can it be like Laos or Cambodia and 356 00:20:46,080 --> 00:20:48,840 Speaker 1: move forward or is there a different equation that you 357 00:20:48,880 --> 00:20:53,480 Speaker 1: see I think I think Donald Trump is doing the 358 00:20:53,560 --> 00:20:56,359 Speaker 1: right rhetoric to try to raise the expectations of the 359 00:20:56,400 --> 00:20:59,840 Speaker 1: North Korean people and its leadership to step up. And 360 00:21:00,040 --> 00:21:03,480 Speaker 1: it is aligned with Kim Jong UN's own desire to 361 00:21:03,560 --> 00:21:07,720 Speaker 1: develop his economy. That is sincere Um, many observers believe 362 00:21:07,800 --> 00:21:11,480 Speaker 1: that but in terms of how the question is, are 363 00:21:11,560 --> 00:21:15,760 Speaker 1: they capable of growing economically into another dragon or tiger? 364 00:21:16,119 --> 00:21:21,280 Speaker 1: How fast and how fast and how stable is the question? 365 00:21:21,400 --> 00:21:23,080 Speaker 1: And I think those are the two areas where I 366 00:21:23,080 --> 00:21:25,840 Speaker 1: would take issue with Mr Trump. UM. One thing I 367 00:21:25,880 --> 00:21:27,960 Speaker 1: want to mention is that you know, even though the 368 00:21:28,000 --> 00:21:31,520 Speaker 1: news headlines say that this is a failed summit because 369 00:21:31,520 --> 00:21:35,680 Speaker 1: Trump walked away with nothing and basically the negotiations broke down, 370 00:21:36,040 --> 00:21:38,639 Speaker 1: I look at it a little differently. I think actually 371 00:21:38,680 --> 00:21:41,119 Speaker 1: this was a good summit in the sense that it 372 00:21:41,200 --> 00:21:45,440 Speaker 1: was constructive. We finally got to see that that Mr 373 00:21:45,480 --> 00:21:48,320 Speaker 1: Kim Jong un can play real hardball and they have 374 00:21:48,480 --> 00:21:52,800 Speaker 1: real clear um bars about what it takes to the 375 00:21:52,920 --> 00:21:56,160 Speaker 1: US to absolutely work with North Korea towards the nuclearization, 376 00:21:56,240 --> 00:22:00,040 Speaker 1: which is full listing of the sanctions UM. And I 377 00:22:00,080 --> 00:22:03,200 Speaker 1: think that it's very good for Mr Trump to realize 378 00:22:03,200 --> 00:22:06,800 Speaker 1: that his own personal charm offensive has its limits and 379 00:22:06,840 --> 00:22:08,920 Speaker 1: that now you need to leave it to the people 380 00:22:08,920 --> 00:22:12,080 Speaker 1: who are experts to really thrash this out, and it'll 381 00:22:12,080 --> 00:22:15,280 Speaker 1: take a lot of time. So, Professor Moon, who do 382 00:22:15,320 --> 00:22:21,240 Speaker 1: you think needs a deal more the US or North Korea? Here? Well, 383 00:22:21,600 --> 00:22:25,000 Speaker 1: the US needs a deal and the question is is 384 00:22:25,000 --> 00:22:29,760 Speaker 1: it Mr Trump needing a deal he wanted mostly uh, 385 00:22:29,920 --> 00:22:32,680 Speaker 1: progress toward a Nobel prize for himself. That is not 386 00:22:32,840 --> 00:22:37,000 Speaker 1: something that was hidden. UM. But also I think for 387 00:22:37,040 --> 00:22:42,320 Speaker 1: the US government, if we are serious about UM preventing 388 00:22:42,760 --> 00:22:46,920 Speaker 1: nuclear escalation, military escalation in East Asia and trying to 389 00:22:46,920 --> 00:22:50,480 Speaker 1: bring some level of cooperation in peace on the peninsula 390 00:22:50,520 --> 00:22:54,040 Speaker 1: after seventy plus years. Yes, it's very, very important, and 391 00:22:54,080 --> 00:22:57,200 Speaker 1: it is considered North Korea is considered a major nuclear, 392 00:22:57,560 --> 00:23:02,000 Speaker 1: major security threat to the United States. UM. But North 393 00:23:02,080 --> 00:23:08,200 Speaker 1: Korea needs the US give because Kim has to have 394 00:23:08,359 --> 00:23:13,840 Speaker 1: economic development in order to survive, and so both sides 395 00:23:14,040 --> 00:23:17,560 Speaker 1: have a pretty loaded game here. Okay, I have to 396 00:23:17,640 --> 00:23:19,119 Speaker 1: leave it there. We're just too short a time. We 397 00:23:19,160 --> 00:23:22,040 Speaker 1: need to get you back on soon as we can. 398 00:23:22,200 --> 00:23:25,359 Speaker 1: Catherine Moon, she is at Wellesley College and the Brookings 399 00:23:25,440 --> 00:23:43,920 Speaker 1: Institute there on the Many Koreas is open. Faulse twoone 400 00:23:44,000 --> 00:23:46,760 Speaker 1: and Tom Keane And we really look towards the longer 401 00:23:46,880 --> 00:23:49,200 Speaker 1: days of spring, which means the i m F meetings, 402 00:23:49,240 --> 00:23:52,600 Speaker 1: and we really kick off here our movement towards those 403 00:23:52,640 --> 00:23:57,120 Speaker 1: important International Monetary Fund meetings that will see along in April. 404 00:23:57,520 --> 00:23:59,359 Speaker 1: And we do that strong with the head of their 405 00:23:59,400 --> 00:24:03,480 Speaker 1: Western him Sphere department, Alejander Werner, with us now the 406 00:24:03,560 --> 00:24:07,199 Speaker 1: International Monetary Fund. I want to begin a discussion on 407 00:24:07,320 --> 00:24:11,600 Speaker 1: Venezuela and Argentina, but I first have to pause and 408 00:24:11,600 --> 00:24:13,800 Speaker 1: that you took your PhD at m I T with 409 00:24:13,840 --> 00:24:17,639 Speaker 1: one of the giants, Rudy dornbush uh in economics. He 410 00:24:17,760 --> 00:24:20,399 Speaker 1: was of a profound impact at i m F with 411 00:24:20,560 --> 00:24:23,600 Speaker 1: Professor dorn Bush of years ago. Would he recognizes i 412 00:24:23,760 --> 00:24:27,640 Speaker 1: m F today or is it a different institution. It's 413 00:24:27,680 --> 00:24:32,239 Speaker 1: definitely a different institution, but that maintains the core of 414 00:24:32,280 --> 00:24:34,520 Speaker 1: its mission. So I think he will recognize and I 415 00:24:34,560 --> 00:24:37,000 Speaker 1: think he will salute the changes that have taken place 416 00:24:37,560 --> 00:24:41,359 Speaker 1: given and that he was a person that really put 417 00:24:41,400 --> 00:24:46,679 Speaker 1: together strong theory with policy implications and applications of that theory. 418 00:24:46,720 --> 00:24:49,399 Speaker 1: We have the privilege and that was speaking literally the 419 00:24:49,520 --> 00:24:53,320 Speaker 1: day of these changes in Venezuela with Ricardo Houseman of 420 00:24:53,400 --> 00:24:56,800 Speaker 1: original Sin and a lot of other theory, and that 421 00:24:56,880 --> 00:25:00,119 Speaker 1: as well. Should Ricardo Houseman and you and should An 422 00:25:00,280 --> 00:25:04,960 Speaker 1: Blegard be optimistic now of a constructive solution to Professor 423 00:25:05,040 --> 00:25:09,879 Speaker 1: Houseman's Venezuela. Well, that's more of a political question than economic. 424 00:25:10,560 --> 00:25:16,119 Speaker 1: That's but I think, look, I think there's a strong 425 00:25:16,160 --> 00:25:20,879 Speaker 1: will by Venezuelan society to start fixing things in their country. 426 00:25:20,880 --> 00:25:25,240 Speaker 1: There's a strong will in the international arena to support 427 00:25:25,359 --> 00:25:31,119 Speaker 1: Venezuela in this transition. So hopefully we will have a 428 00:25:31,240 --> 00:25:34,800 Speaker 1: government in Venezuela that reaches out to the international community 429 00:25:34,840 --> 00:25:37,359 Speaker 1: and and that puts in the policies to fix this. 430 00:25:37,520 --> 00:25:41,760 Speaker 1: Can you apply what you did in Argentina to Venezuela 431 00:25:41,920 --> 00:25:44,840 Speaker 1: or is it so broken the i m F has 432 00:25:44,880 --> 00:25:48,959 Speaker 1: to use a different path. It's it's it's clearly a 433 00:25:49,080 --> 00:25:53,119 Speaker 1: very different situation. It's a different path. It's one of 434 00:25:53,160 --> 00:25:57,320 Speaker 1: the most complex crisis that we have seen. It combines 435 00:25:58,320 --> 00:26:04,560 Speaker 1: a humanitarian crisis, they complete destruction of the productive network 436 00:26:04,640 --> 00:26:10,439 Speaker 1: of the economy, hyper inflation, a dead crisis, and a 437 00:26:10,480 --> 00:26:14,680 Speaker 1: migration crisis. So we have dealt with some of them 438 00:26:15,400 --> 00:26:17,679 Speaker 1: in each of the cases that we go through, but 439 00:26:18,160 --> 00:26:21,040 Speaker 1: the five of them together, it's a very complex situation 440 00:26:21,119 --> 00:26:24,760 Speaker 1: that it will need the efforts of many institutions. But 441 00:26:25,080 --> 00:26:28,760 Speaker 1: I mean, it can obviously be done, and a success story, 442 00:26:28,840 --> 00:26:31,080 Speaker 1: certainly for the I m F was the Ukraine recently, 443 00:26:31,119 --> 00:26:35,639 Speaker 1: where creditors received almost par on their bonds. But I 444 00:26:35,680 --> 00:26:40,000 Speaker 1: think you know, even I it's probably unlikely that that 445 00:26:40,040 --> 00:26:43,879 Speaker 1: would occur in Venezuela. So what what are the creditors? 446 00:26:43,880 --> 00:26:46,240 Speaker 1: What do they expect in any type of restructuring here? 447 00:26:46,240 --> 00:26:48,080 Speaker 1: What is they what? What do you think is kind 448 00:26:48,080 --> 00:26:51,240 Speaker 1: of the how does supply out? I think what they 449 00:26:51,359 --> 00:26:57,520 Speaker 1: what they expect, it's a a policy package that actually 450 00:26:57,560 --> 00:27:02,200 Speaker 1: puts the country in so sustainable path. I think if 451 00:27:02,240 --> 00:27:04,920 Speaker 1: you look at the pricing of the bonds today, obviously 452 00:27:04,960 --> 00:27:09,639 Speaker 1: nobody is expecting a full recovery. But what they what 453 00:27:09,760 --> 00:27:13,320 Speaker 1: they would expect, and that's why they're holding onto these 454 00:27:13,359 --> 00:27:16,320 Speaker 1: bonds is basically that eventually a package will be put 455 00:27:16,359 --> 00:27:19,320 Speaker 1: together that a country with the wealth that Venezuela has 456 00:27:19,520 --> 00:27:22,960 Speaker 1: can laid out the policies to go back to a sustainable, 457 00:27:23,200 --> 00:27:26,639 Speaker 1: inclusive growth process that eventually will give some value to 458 00:27:26,720 --> 00:27:30,399 Speaker 1: those bonds and people will have some upside given the 459 00:27:30,480 --> 00:27:34,240 Speaker 1: policies put together and given the growth path that they 460 00:27:34,440 --> 00:27:37,159 Speaker 1: that the economy can get into. To what extent can 461 00:27:37,160 --> 00:27:39,120 Speaker 1: the I m F B a part of that? What's 462 00:27:39,119 --> 00:27:41,159 Speaker 1: the balantry that I am f How much can have 463 00:27:41,320 --> 00:27:45,560 Speaker 1: come in and support whatever change takes place? Obviously, we 464 00:27:45,560 --> 00:27:50,680 Speaker 1: we can, we can, and I think hopefully Venezuela will 465 00:27:50,720 --> 00:27:54,560 Speaker 1: see in US an institution that can help us give 466 00:27:54,600 --> 00:27:58,520 Speaker 1: them the international experience on many areas on how to 467 00:27:58,600 --> 00:28:02,159 Speaker 1: put policies together, can give them the financial part of 468 00:28:02,160 --> 00:28:05,560 Speaker 1: the financial support that they will need to grow themselves 469 00:28:05,640 --> 00:28:07,600 Speaker 1: out of these problems. There will be a lot of 470 00:28:08,280 --> 00:28:11,240 Speaker 1: needs for investment in the oil and non oil sector, 471 00:28:11,280 --> 00:28:14,639 Speaker 1: but also needs to increase the consumption of the population 472 00:28:14,680 --> 00:28:18,560 Speaker 1: that it's at very low, low level, generating very deep 473 00:28:18,600 --> 00:28:21,800 Speaker 1: health problems. And as I said, we have the expertise 474 00:28:22,040 --> 00:28:25,359 Speaker 1: and we do have an important balance sheet to help 475 00:28:25,400 --> 00:28:30,000 Speaker 1: and finance this transition. What is the state of populism 476 00:28:30,320 --> 00:28:33,320 Speaker 1: in South America? You do the Western hemisphere and that's 477 00:28:33,320 --> 00:28:36,920 Speaker 1: a pretty broad mandate, but the state of political unrest 478 00:28:36,960 --> 00:28:39,480 Speaker 1: in Europe or this you know the story in America 479 00:28:39,520 --> 00:28:42,920 Speaker 1: as well. The state of populism that we see in 480 00:28:42,960 --> 00:28:46,480 Speaker 1: South America and how it links in the prosperity If 481 00:28:46,480 --> 00:28:48,800 Speaker 1: you don't work on this, yeah, it's it's it's a 482 00:28:48,880 --> 00:28:52,360 Speaker 1: very interesting question because I mean Latin America in this 483 00:28:52,800 --> 00:28:57,320 Speaker 1: let's call it populism cycle and defining populism. It's it's 484 00:28:57,120 --> 00:29:02,560 Speaker 1: it's a fuzzy concept took place before what we're seeing 485 00:29:02,560 --> 00:29:04,760 Speaker 1: in some advanced economies. At the end of the day, 486 00:29:05,080 --> 00:29:10,400 Speaker 1: we saw a significant burst of regimes that tried to 487 00:29:10,440 --> 00:29:13,680 Speaker 1: spend their way out of the deep social and economic 488 00:29:13,720 --> 00:29:17,480 Speaker 1: problems that some Latin American nations have on the back 489 00:29:17,680 --> 00:29:21,680 Speaker 1: of huge income coming from the commodity boom. So the 490 00:29:21,800 --> 00:29:24,160 Speaker 1: Venezuela is the extreme. On the back on the of 491 00:29:24,320 --> 00:29:27,640 Speaker 1: the oil boom, we saw a huge increasing government expenses, 492 00:29:27,680 --> 00:29:32,400 Speaker 1: et cetera that when commodity prices collapses, then these regimes 493 00:29:32,440 --> 00:29:35,200 Speaker 1: were unsustainable. So those are the changes that we have 494 00:29:35,320 --> 00:29:38,920 Speaker 1: seen in Argentina and we're seeing now in Ecuador, and 495 00:29:39,000 --> 00:29:41,960 Speaker 1: now we're seeing the deep problems in Venezuela. So we're 496 00:29:42,000 --> 00:29:45,240 Speaker 1: seeing the last stages of the of that process. We 497 00:29:45,280 --> 00:29:47,200 Speaker 1: have to leave it there, but look for the senior 498 00:29:47,480 --> 00:29:50,360 Speaker 1: and looking forward to see you in the spring. Thank 499 00:29:50,360 --> 00:29:53,120 Speaker 1: you so much is Western Hemisphere Department leader for the 500 00:29:53,200 --> 00:30:00,120 Speaker 1: International Monetary Fund. Thanks for listening to The Bloomberg's ban 501 00:30:00,200 --> 00:30:05,840 Speaker 1: Last podcast. Subscribe and listen to interviews on Apple Podcasts, SoundCloud, 502 00:30:06,200 --> 00:30:10,440 Speaker 1: or whichever podcast platform you prefer. I'm on Twitter at 503 00:30:10,480 --> 00:30:14,680 Speaker 1: Tom Keane. Before the podcast you can always catch us worldwide. 504 00:30:15,200 --> 00:30:16,280 Speaker 1: I'm Bloomberg Radio.