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Speaker 1: Bloomberg Audio Studios, podcasts, radio news. You're listening to the

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Speaker 1: Bloomberg Balance of Power podcast. Catch us live weekdays at

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Speaker 1: noon and five pm Eastern on Apple, Cocklay and Android

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Speaker 1: Auto with the Bloomberg Business App. Listen on demand wherever

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Speaker 1: you get your podcasts, or watch us live on YouTube.

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Speaker 2: The White House, of course releasing a statement the title

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Speaker 2: which reads as follows, Clarification of Exemptions under Executive Order

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Speaker 2: one four two five seven of April second, twenty twenty five,

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Speaker 2: as amended. The word exemptions is in there, but President

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Speaker 2: Trump says it's fake news to describe this as exemptions

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Speaker 2: or exceptions to his tariffs, because tariffs on these goods

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Speaker 2: things like iPhones other consumer electronics are still coming, just

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Speaker 2: in a different bucket, as he calls it, semiconductor tariffs,

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Speaker 2: which he says are on the way in the not

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Speaker 2: so distant future, in addition to other tariffs he just

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Speaker 2: talked about in the Oval Office as well. So on

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Speaker 2: that note, we go to Bloomberg Tyler Kendall, who is

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Speaker 2: live at the White House, with what we are understanding

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Speaker 2: at this point from the administration when it comes to tariffs.

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Speaker 3: It's not just chip tariffs. Tyler that are on the way.

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Speaker 3: The President's looking at pharma too.

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Speaker 4: Yeah, hey, Kelly, some big headlines, particularly when it comes

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Speaker 4: to those sector specific tariffs, in just the last thirty

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Speaker 4: minutes or so out of the Oval Office. As you mentioned,

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Speaker 4: President Trump doubling down on the idea that pharmaceutical tariffs

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Speaker 4: could be coming. So not necessarily surprising. He's really been

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Speaker 4: talking about this, but we should note the timing is

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Speaker 4: also interesting because the Italian Prime Minister, Georgia Maloney will

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Speaker 4: be here at the White House later this week. We

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Speaker 4: know that the European Union in particular is bracing to

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Speaker 4: get hard, is bracing to get hit hard when it

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Speaker 4: comes to those pharmaceutical tariffs. Then he also made some

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Speaker 4: news about some other sector specific tariffs, saying that he

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Speaker 4: might be interested in granting a reprieve when it comes

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Speaker 4: to automakers who are moving production from Mexico and Canada

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Speaker 4: in a bid to give him a little bit more

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Speaker 4: time when it comes to reshoring. So some big headlines

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Speaker 4: there about how this White House is looking at the

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Speaker 4: timeline and whether or not we could actually see a

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Speaker 4: more long, longer lasting reprieve. The other industry, of course,

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Speaker 4: that is getting at least a fleeting reprieve for now

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Speaker 4: or those tech imports that you mentioned, while we wait

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Speaker 4: for potentially a Section two thirty two investigation to get

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Speaker 4: underway so that those chip products can be a tariff

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Speaker 4: instead under sector specific tariffs instead of the broader, so

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Speaker 4: called reciprocal tariff plan. But when asked on Air Force

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Speaker 4: one last night about if he was willing to grant

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Speaker 4: any exemptions to certain products, here's what President Trump had

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Speaker 4: to say.

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Speaker 5: Well, there's going to be an anspert soon and we'll

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Speaker 5: we'll be discussing it, but we'll also talk to companies.

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Speaker 5: You know, you have to show a certain flexibility. Nobody

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Speaker 5: should be so rigent. Will you have to have a

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Speaker 5: certain flexibility. And we're doing really well, and financially, our

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Speaker 5: country is going to be stronger than it sever been.

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Speaker 6: So some products might lose flexibility for some products, for

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Speaker 6: some products, yeah, maybe.

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Speaker 4: Of course, the big question is just how flex will

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Speaker 4: this White House be. In the past, when they've imposed

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Speaker 4: Section two thirty two tariffs, they've been at a twenty

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Speaker 4: five percent rate. President Trump declined to comment on what

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Speaker 4: the rate will be when it comes to these chip

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Speaker 4: specific products. But we also have to keep in mind

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Speaker 4: how sector specific tariffs are designed to be stacked on

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Speaker 4: top of existing levies, and Kaylee, President Trump made clear

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Speaker 4: that all of these tech imports are still subject to

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Speaker 4: that baseline twenty percent tariff that was levied against Beijing

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Speaker 4: back in February.

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Speaker 2: Yep, over Fentanel Bloomberg's Tyler tend to live at the

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Speaker 2: White House, thank you so much. And on that flexibility

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Speaker 2: point that Tyler was just making, we heard that reiterated

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Speaker 2: by President Trump in the Oval Office earlier today, in

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Speaker 2: which he also noted that he's been talking to the

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Speaker 2: CEO of Apple, Tim Cook, and that he doesn't want

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Speaker 2: to hurt anybody. Apple shares right now, well off the

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Speaker 2: highs of the session, they're still up about two point

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Speaker 2: six percent. And it's on that note we turned to

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Speaker 2: Ed Ludlow, co host of Bloomberg Technology. So Ed, when

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Speaker 2: we consider that obviously Apple was stuck in a very

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Speaker 2: difficult place with the tariffs that are that were put

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Speaker 2: into place, especially if China tariffs applied to them, how

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Speaker 2: much can they take advantage of this reprieve if the

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Speaker 2: reprieve is only temporary.

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Speaker 7: Yeah, I think the technology sector kind of accepts that

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Speaker 7: there will be a bucket specific tariff, right, and that

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Speaker 7: the biggest outstanding questions are on timeline because you have

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Speaker 7: the written communication from the White House, which you quite

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Speaker 7: rightly point out literally uses the word exemption. And then

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Speaker 7: take in aggregate the commentary of Trump's cabinet members on

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Speaker 7: weekend television. But something specific at the semiconductor level also

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Speaker 7: branches out to the rest of the electronics industry, right,

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Speaker 7: because the smartphones's laptops all have chips in them, you

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Speaker 7: need to understand what that's going to be. And you

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Speaker 7: know better than I. The biggest kind of unknown here

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Speaker 7: is this section two thirty two investigation, which looks at

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Speaker 7: the impact of tariff policy on national security. Essentially it's

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Speaker 7: a tool that's been used in the steel industry, for example.

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Speaker 7: But you know, looking at history, those investigations take the

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Speaker 7: better part of a year. So answer your question, Apple,

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Speaker 7: you know clearly their strategy has been to shift priority

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Speaker 7: of iPhones built outside of China, largely in India, and

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Speaker 7: move them to the US. But it's just a temporary measure.

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Speaker 7: The other question, and the one that probably in video

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Speaker 7: is the better case study of is what is the

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Speaker 7: end goal of the President's policy. Is it to generate

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Speaker 7: revenue for the country. No, it's probably to onshore manufacturing

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Speaker 7: in America, which is a whole other question.

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Speaker 2: Well, and the President was talking about that earlier in

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Speaker 2: the Oval, touting the announcement today of how in Video

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Speaker 2: is using its pledged billions hundreds of billions of dollars

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Speaker 2: in investment in the US.

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Speaker 3: This is what the President said at It's.

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Speaker 8: One of the great companies of the world, modern, super

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Speaker 8: modern companies controls segments that nobody, you know, sort of

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Speaker 8: controls the world in a sense. And they're coming in

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Speaker 8: here in the biggest way with hundreds of billions of dollars,

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Speaker 8: not like millions of dolls, hundreds of billions of dollars.

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Speaker 9: And I'm honored by it, and.

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Speaker 8: I want to thank Jensen and all of the people

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Speaker 8: that we deal with.

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Speaker 2: My question, ad is one thing. It's one thing to

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Speaker 2: make the pledge of investment. It's another for that investment

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Speaker 2: to actually be realized and result in capacity in the

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Speaker 2: United States. How long is this going to take, not

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Speaker 2: just for in Video, but any tech company who wants

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Speaker 2: to do this.

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Speaker 7: Well, according to Invidia's announcement this morning, four years to

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Speaker 7: develop a US manufacturing capacity for their server designs that

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Speaker 7: go in Stata centers, power AI training. There's an element

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Speaker 7: of fact check here. Yes, the President is right that

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Speaker 7: Invidia essentially has a monopoly on the market for AI accelerators,

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Speaker 7: the chips that train models. He is sort of incorrect

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Speaker 7: to say that it is an investment of hundreds of

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Speaker 7: billions of dollars. What Invidia is saying is that they

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Speaker 7: are moving to establish manufacturing in the States that will

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Speaker 7: produce hundreds of billions dollars value of goods. That is

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Speaker 7: the cost of doing business here in America. But I

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Speaker 7: think most people I speak to in the technology industry,

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Speaker 7: directly involved and related to InVideo investors is this is

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Speaker 7: the result of tariff policy. Because think about Nvidia, right,

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Speaker 7: if you make your high performance systems here in America,

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Speaker 7: they probably cost twenty to twenty five percent more. The

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Speaker 7: cost of doing business here is greater, but then there's

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Speaker 7: a tariff on doing business elsewhere, probably in the long run,

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Speaker 7: and so netnet, if you're in video or you're one

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Speaker 7: of Nvidia's customers, you have to choose what is the

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Speaker 7: best place for us to do business here? And clearly

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Speaker 7: reading the statement from Jensen Wog. He talks about supply

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Speaker 7: chain resilience and talks about making the business more robust.

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Speaker 7: This is a response to the political actions of this administration.

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Speaker 3: All right, Ed.

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Speaker 2: Ludlaw in San Francisco, Thank you so much, co host

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Speaker 2: of course of Bloomberg Technology.

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Speaker 3: Much appreciated.

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Speaker 2: This, of course is Bloomberg's balance of power as we

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Speaker 2: consider the intersection of these tariff policies, how they're filtering

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Speaker 2: into the decision making of companies like Nvidia, and ultimately

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Speaker 2: how all that feeds back into financial markets, which have

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Speaker 2: seen at least in the equity market at the relief

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Speaker 2: rally fading. As we've moved through this Monday trading session,

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Speaker 2: and we want to talk more about the outlook now,

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Speaker 2: and turned to Katrina Dudley, who is live in our

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Speaker 2: studios at Global Headquarters in New York. She's Global equity

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Speaker 2: portfolio manager at Franklin Templeton Investments. Joining me here on

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Speaker 2: Bloomberg TV and Radio. Katrina, it's been a while, obviously,

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Speaker 2: it has been a month, a week, a year that

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Speaker 2: has been absolutely wild when we're contending with tariff policy.

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Speaker 2: I wonder what you make of this conversation around tech

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Speaker 2: knowledgy oriented exemption, specifically the idea that there is a

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Speaker 2: bit of a reprieve here that the President suggests he

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Speaker 2: will have some flexibility in carving out certain goods from

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Speaker 2: these tariffs. Do you see all of that as good

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Speaker 2: news or is there still enough bad news in terms

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Speaker 2: of the baseline tariff rate that is still in place,

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Speaker 2: the tariffs on China that will remain with no real

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Speaker 2: progress see toward a deal. Is all of that still

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Speaker 2: enough to be dragging on risk appetite?

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Speaker 10: I think, look, when we look at tariffs and the conversation,

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Speaker 10: the key, as you're talking about, is flexibility that the

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Speaker 10: president is willing to listen. He's watching the market, he's

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Speaker 10: watching the reaction, and he's listening to CEOs and he's

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Speaker 10: listening to what they're telling him. And in this case,

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Speaker 10: we've got some CEOs of reacting in terms of we

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Speaker 10: are going to make investments in America, and that from

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Speaker 10: a perspective of an American is really good from us

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Speaker 10: from a resiliency perspective as well as that reassuring if

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Speaker 10: jobs and helping that middle class. And then you've got

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Speaker 10: on the other side the fact that these factories don't

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Speaker 10: just get built overnight, and I think that there is

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Speaker 10: a need to phase in some of these tariffs and

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Speaker 10: phase in those those measures, which I think he's going

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Speaker 10: to do through that exemption mechanism.

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Speaker 2: Well, I guess there's a question of what happens in

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Speaker 2: the interim when we're actually considering the health of these

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Speaker 2: corporations and their financial picture. Knowing we're now in the

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Speaker 2: heart of earning season. I wonder, Katrina, how you expect

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Speaker 2: the uncertainties around this policy that remain the difference in

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Speaker 2: the short and the long term outlook to manifest themselves.

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Speaker 2: And what we're hearing not just about the results looking backward,

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Speaker 2: but what kind of guidance companies are really able to

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Speaker 2: provide going forward.

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Speaker 10: Look, the impact is being felt actually more in the

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Speaker 10: small and the meadcap sector. If you look at our

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Speaker 10: large cab companies, they've got much more resilience in terms

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Speaker 10: of the balance sheet, their ability to flex their manufacturing.

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Speaker 10: So it's actually going to be in that lower end

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Speaker 10: of the market that you need to focus on the

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Speaker 10: comments that are coming out of them. That's the first side.

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Speaker 10: The second thing is that we've got these initial announcements,

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Speaker 10: but then we've had reversal some of these announcements. We've

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Speaker 10: had adjustments and everything. So I think that the commentary

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Speaker 10: coming out of earning season is going to be we

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Speaker 10: actually had a great quarter, spending held up and so

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Speaker 10: the numbers for the backward looking quarter are going to

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Speaker 10: be okay. It's just going to be that uncertainty that

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Speaker 10: relates to the forward outlook. And I think that CEOs

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Speaker 10: who talk about the variables and talk about what they're

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Speaker 10: looking at and what is causing that variability, will be

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Speaker 10: rewarded by the market.

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Speaker 4: Well.

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Speaker 2: And which would you be more concerned about when we

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Speaker 2: consider the different variables in the forward picture, the idea

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Speaker 2: that it's not clear what the tariff rates will be,

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Speaker 2: so therefore what kind of margin compression companies might be

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Speaker 2: dealing with, or the idea that it's not clear what

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Speaker 2: economic impact the tariffs will have in how much demand

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Speaker 2: there will still be that these corporations get to be

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Speaker 2: on the receiving end of Which would you say is

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Speaker 2: the greater risk here or are they just too entwined Katrina.

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Speaker 10: Both They're actually both risks in the market. The first

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Speaker 10: of all, in terms of the amount of tariffs, the

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Speaker 10: question is how much of that gets passed on to

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Speaker 10: the consumer. The second part of this is how much

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Speaker 10: of the consumer is actually doing forward buying or has

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Speaker 10: been doing forward buying, like buying two or three Apple

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Speaker 10: iPhones ahead of the announcements. So you could have some

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Speaker 10: unevenness in terms of demand patterns, and that's something that

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Speaker 10: we're watching. But if that margin pressure, if you look

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Speaker 10: at corporate margins are very very strong and high levels,

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Speaker 10: so I think that there's some ability of them to

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Speaker 10: absorb some of those tariffs in their own margins. And

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Speaker 10: that doesn't worry us because we think that companies are

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Speaker 10: well positioned.

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Speaker 9: Well.

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Speaker 2: And I wonder what companies you see as best position here, Katrina,

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Speaker 2: Is it staples really that are the safest heven right now?

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Speaker 2: Where else would you be recommending you seek harbor in

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Speaker 2: what has been a pretty incredible storm.

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Speaker 10: But when you talk about a staple, those staple companies

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Speaker 10: are still subject to goods that have got tariffs on them.

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Speaker 3: We don't make all project.

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Speaker 10: Produce here in America, and so they're subject to the

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Speaker 10: same characteristics as before. So I think it's actually very

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Speaker 10: unusual because there's so many different factors that people have

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Speaker 10: got to look at that are influencing this market that

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Speaker 10: haven't influenced it before. We talk about the partisanship that's

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Speaker 10: really impacting the ability to trust any type of forward

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Speaker 10: looking sentiment index because you've got that dichotomy between the

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Speaker 10: Republicans and the Democrats, as well as the fact that

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Speaker 10: you know, things like tariffs. We've had them in terms

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Speaker 10: of industry specific tariffs with long investigation periods. Now we've

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Speaker 10: got them, they've being implemented quickly, and they've been implemented

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Speaker 10: in a much more broad brush manner, and that's going

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Speaker 10: to impact the consumer. So it's just a different conversation,

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Speaker 10: and that's what we're kind of working through and listening

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Speaker 10: to companies to see how it impacts the bottom line.

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Speaker 9: Well.

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Speaker 3: And then there's the kind of wider macro picture as well.

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Speaker 2: That is a constant conversation we're having here on Bloomberg

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Speaker 2: TV and Radio Katrina, which is how this all filters

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Speaker 2: into monetary policy, if at all. As the signal we're

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Speaker 2: still getting from the FED is they are in weight

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Speaker 2: and C mode, it doesn't seem that they are super

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Speaker 2: eager to see a FED put come into place here

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Speaker 2: of any kind. Are you anticipating that have you changed

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Speaker 2: your expectations, and and what if we are to get

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Speaker 2: a signal from the Fed that they're willing to step

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Speaker 2: in here would that do to risk appetite.

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Speaker 10: It's very difficult for the FED to step in because

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Speaker 10: one of the metrics that they're watching is inflation, and

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Speaker 10: they've spent a long period of time getting inflation which

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Speaker 10: was at very high levels and very far away from

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Speaker 10: target back down close to two point six, very close

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Speaker 10: to their target level. And then what we're so that's

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Speaker 10: on the Fed that's kind of looking at. We've got

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Speaker 10: low unemployment numbers, we've got an inflation number that we've

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Speaker 10: kind of got under control, but tariffs potentially are a

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Speaker 10: headwind to that that they could cause inflationary pressure. So

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Speaker 10: the market, though, is pricing in three Fed cuts. I

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Speaker 10: think we're at less than that. We do think that

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Speaker 10: the Fed is going to be very cautious before they

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Speaker 10: step in. I think you've talked about a FED put.

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Speaker 10: I think that President Trump is more likely to make

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Speaker 10: commentary that supports the market versus the Fed.

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Speaker 2: Well, a lot of people thought we found the Trump

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Speaker 2: put last week when he noted what was happening in

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Speaker 2: the bond markets and issued this ninety day delay in

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Speaker 2: our final minute here, Katrina, though, obviously what happened in

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Speaker 2: the bond market, as well as what we've seen in

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Speaker 2: the weakness of the dollar, has kind of contributed to this,

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Speaker 2: if not narrative question as to whether we are now

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Speaker 2: reconsidering US exceptionalism from an equity standpoint, Do you think the.

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Speaker 3: End of US exceptionalism is upon us?

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Speaker 10: Absolutely not. I think that the America and our resiliency

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Speaker 10: and our ability to adapt is what makes this country

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Speaker 10: so unique. And I don't think that anything that's happened

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Speaker 10: is actually undermined that. If I take a look at

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Speaker 10: the factors that support entrepreneurialism, and I look at the

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Speaker 10: factors that are encouraging investment back into this country by

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Speaker 10: a number of companies, Invidiari is just the latest company

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Speaker 10: that's doing that on top of a TSMC, I think

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Speaker 10: that the American story continues to work here.

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Speaker 3: All right.

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Speaker 2: We will leave it on that note. Katrina Dudley of

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Speaker 2: Franklin Templeton Investments, where she is a global equity portfolio manager,

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Speaker 2: joining us here on Bloomberg TV and Radio. Thank you

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Speaker 2: so much, really appreciate it, and we still have much

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Speaker 2: more ahead here on Balance of Power. Our political panel

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Speaker 2: will be joining me next. Rick Davis and Jeanie Shanzeno

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Speaker 2: will be with me as we consider how all of

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Speaker 2: this is playing out politically for President Trump. We've got

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Speaker 2: some interesting new polling from CBS and Yugov around how

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Speaker 2: people feel about tariffs, and also just a red headline

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Speaker 2: crossing the Bloomberg terminal Harvard rejecting a proposed agreement with

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Speaker 2: the Trump administration. Of course, we've seen a bit of

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Speaker 2: a jockeying between higher ed and this White House.

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Speaker 3: We'll get into that with our political panel as well.

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Speaker 3: Up next. Right here on Bloomberg TV and Radio.

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Speaker 1: You're listening to the Bloomberg Balance of Power podcast. Catch

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Speaker 1: us live weekdays at noon and five pm Eastern on Apple,

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Speaker 1: Cocklay and Android Auto with the Bloomberg Business App. You

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Speaker 1: can also listen live on Amazon Alexa from our flagship

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Speaker 1: New York station, Just Say Alexa played Bloomberg eleven thirty.

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Speaker 2: Live in Washington, where we are focused on basically one thing,

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Speaker 2: and that is President Trump's tariff policy, and that seems

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Speaker 2: to be, if not the singular, the primary focus of

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Speaker 2: financial markets as well as Amy was just running US

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Speaker 2: through and it was a big topic of conversation on

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Speaker 2: the Sunday shows this weekend, where you had a number

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Speaker 2: of members of the Trump administration fanning out across the

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Speaker 2: networks to defend and explain President Trump's tariff policy. From

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Speaker 2: the Commerce Secretary Howard Lutnik to Trade Advisor Peter Navarro,

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Speaker 2: Kevin Hassett of the National Economic Council, and USTR Jamison

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Speaker 2: Greer all shared their thoughts this weekend.

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Speaker 11: The President is on it.

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Speaker 12: It's very very important for people to understand, you know,

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Speaker 12: why we're doing what we're doing.

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Speaker 11: What President Trump is doing, and his vision and his

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Speaker 11: leadership is to completely realign the world economy, but in

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Speaker 11: so doing put America first. The world cheats us. They've

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Speaker 11: been cheating us for decades. We have been living under

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Speaker 11: a teriff regime, but it has been the regime of

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Speaker 11: other countries.

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Speaker 13: The more importantly they cheat us with the so called

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Speaker 13: non tariff barriers.

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Speaker 14: It's the vat tax, is the dumping, the currency manipulation.

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Speaker 11: We can't be relying on China for fundamental things that

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Speaker 11: we need.

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Speaker 15: What's going to be up to these countries to come

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Speaker 15: to the table, continue coming to the table.

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Speaker 3: And make these kinds of offers.

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Speaker 2: So the administration outlining its vision when it comes to trade.

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Speaker 2: The question is whether it's a vision that the majority

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Speaker 2: of the country and the American electorate actually shares as well.

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Speaker 2: And on that note, some interesting polling came out this

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Speaker 2: weekend from CBS News together with you goev that focused

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Speaker 2: on tariffs and the economy overall.

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Speaker 3: Here's a few of the highlights for you.

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Speaker 2: On tariffs, largely, fifty eight percent said they opposed President

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Speaker 2: Trump's new tariffs on imported goods, just forty two percent

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Speaker 2: said they favored them, and seventy five percent said the

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Speaker 2: tariffs will increase prices in the short term. Another forty

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Speaker 2: eight percent said they will increase prices in the long term.

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Speaker 2: Smaller minorities said they would have no impact, or they

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Speaker 2: weren't sure, or that they would decrease prices. Plus another

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Speaker 2: finding in this survey, nearly two thirds think the new

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Speaker 2: tariffs will make the economy worse in the short term.

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Speaker 2: All that said, when we consider President of Trump's overall

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Speaker 2: approval rating, forty seven percent approve, fifty three percent disapprove.

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Speaker 2: So I want to get into these figures now and

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Speaker 2: how the policy is playing politically and turned to our

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Speaker 2: political panel. Bloomberg Politics contributors Rick Davis and Genie Shanzeno

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Speaker 2: are with me here on Bloomberg TV and Radio. Rick,

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Speaker 2: of course as a partner at Stone Court Capital and

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Speaker 2: Republican strategist, Genie democratic analyst and Senior Democracy Fellow at

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Speaker 2: the Center for the Study of the Presidency and Congress.

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Speaker 3: Rick, when you look at figures.

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Speaker 2: Like this, it would suggest that these policies, as much

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Speaker 2: as President Trump believes them and continues to define tariffs

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Speaker 2: or say tariffs is his favorite word in the dictionary,

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Speaker 2: that it's not necessarily favored by the majority of the country.

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Speaker 2: Does it, ultimately, though, make a difference for this White House?

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Speaker 15: You know, I think only on the margins. Does it

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Speaker 15: make a difference for this White House? In other words,

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Speaker 15: will they tweak their policies ninety day delays, things like

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Speaker 15: that in order to sort of satisfy consumer demand and

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Speaker 15: also the markets, because, of course, part of what is

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Speaker 15: driving consumers' attitudes is what they see in the market.

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Speaker 15: So the combination platter of you know, robust economy, strong markets,

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Speaker 15: and consumer support is something they have to be considering

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Speaker 15: on a daily basis. And seeing them tweaked their policies,

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Speaker 15: especially around tariffs. In that regard that being said, you know,

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Speaker 15: these consumers are pretty grumpy. We saw last week the

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Speaker 15: Michigan Consumer Sentiment Index came out very similar numbers, worse

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Speaker 15: expectations for inflation since nineteen eighty one.

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Speaker 11: So the.

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Speaker 15: Book is getting written pretty strongly right now that maybe

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Speaker 15: we can't necessarily depend upon consumers to keep this economy running.

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Speaker 15: They're doing a great job right now, but with their

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Speaker 15: concerns about the future, I would say the FED is

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Speaker 15: probably more worried about future inflation than it is inflation today.

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Speaker 2: Well, and I guess it's a question of how far

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Speaker 2: into the future, because when we consider the kind of

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Speaker 2: language in this pulling data, Genie again seventy five percent

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Speaker 2: so that the tariffs will increase prices in the short term.

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Speaker 2: Nearly two thirds think new tariffs will make the economy

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Speaker 2: worse in the short term. House hasn't necessarily pushed back

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Speaker 2: on the idea of there being some detrimental impact in

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Speaker 2: the short term. They keep saying short term pain for

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Speaker 2: long term gain. I guess the question is is it

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Speaker 2: enough for consumers to tolerate that in the short term

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Speaker 2: if they believe in the long term game, or do

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Speaker 2: you think that belief still might be missing as they

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Speaker 2: consider what this is actually going to do to their

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Speaker 2: wallets in household balance sheets.

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Speaker 12: Yeah, consumers are screaming, we don't want pain of any kind,

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Speaker 12: short term or long term. And quite frankly, the White

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Speaker 12: House isn't listening. And why the White House isn't listening?

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Speaker 12: Donald Trump doesn't have to run again. But who's gonna

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Speaker 12: listen are the Republican members of Congress because they will

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Speaker 12: hear from their constituents who say, hey, wait a minute,

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Speaker 12: all of these exemptions the president is handing out my

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Speaker 12: little store in Oklahoma. I'm not on his radar because

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Speaker 12: I didn't give a million dollars to his inaugural so

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Speaker 12: I can't get in his ear to claim an exemption.

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Speaker 12: And that's what I think we have to ask ourselves,

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Speaker 12: why all these exemptions, Why tariff policies that are so arbitrary?

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Speaker 12: Because Donald Trump wants the power to dole out crony,

439
00:22:12,200 --> 00:22:15,560
Speaker 12: give out to the people that he feels he are

440
00:22:15,560 --> 00:22:19,399
Speaker 12: in alignment with him, and he wants to withhold for others.

441
00:22:19,520 --> 00:22:22,400
Speaker 12: And that's really what this about. It's not about reshoring

442
00:22:22,440 --> 00:22:25,199
Speaker 12: because exemptions work against that. We are not in an

443
00:22:25,240 --> 00:22:28,520
Speaker 12: emergency that makes us pay more for sneakers than we

444
00:22:28,560 --> 00:22:30,359
Speaker 12: would for electronics.

445
00:22:30,640 --> 00:22:32,000
Speaker 3: So people know this.

446
00:22:32,119 --> 00:22:34,160
Speaker 12: I mean, people go to the store and pay more

447
00:22:34,280 --> 00:22:36,880
Speaker 12: for eggs as Easter is coming up. And we've all

448
00:22:36,920 --> 00:22:40,520
Speaker 12: heard the one answer people answer when you say, why

449
00:22:40,560 --> 00:22:44,040
Speaker 12: am I paying more Donald Trump's tariffs? And this will

450
00:22:44,119 --> 00:22:47,040
Speaker 12: hurt Republicans in the polls. It may not hurt Donald

451
00:22:47,040 --> 00:22:49,720
Speaker 12: Trump because quite frankly, he just wants the power. He

452
00:22:49,760 --> 00:22:52,400
Speaker 12: doesn't have to run again, so he doesn't really care

453
00:22:52,440 --> 00:22:53,680
Speaker 12: about these poles anymore.

454
00:22:54,880 --> 00:22:57,520
Speaker 2: Well to that point, Rick, Congress is in recess for

455
00:22:57,560 --> 00:22:59,199
Speaker 2: the next two weeks for Easter. A lot of them

456
00:22:59,240 --> 00:23:01,280
Speaker 2: are back home and the districts. I don't know how

457
00:23:01,320 --> 00:23:03,800
Speaker 2: many of them are planning to get some FaceTime in

458
00:23:03,840 --> 00:23:06,080
Speaker 2: face to face with constituents in the form of town

459
00:23:06,080 --> 00:23:09,760
Speaker 2: halls because of concern around blowback around these policies. Just

460
00:23:09,800 --> 00:23:12,840
Speaker 2: how rough will it be for Republican members, especially in

461
00:23:12,920 --> 00:23:14,200
Speaker 2: terms of what they're hearing at home.

462
00:23:15,600 --> 00:23:18,040
Speaker 15: Well, you know, getting back to these numbers, we haven't

463
00:23:18,040 --> 00:23:20,760
Speaker 15: seen these kinds of numbers in a long time. It

464
00:23:20,800 --> 00:23:25,080
Speaker 15: really does show frustration on the part of consumers consumers

465
00:23:25,160 --> 00:23:30,600
Speaker 15: or voters, and angry voters or angry consumers make angry voters.

466
00:23:30,640 --> 00:23:34,920
Speaker 15: And so if there are some sort of brave enough

467
00:23:35,040 --> 00:23:40,199
Speaker 15: Republican officeholders who are going to willingly participate in public

468
00:23:40,240 --> 00:23:43,760
Speaker 15: forums like town halls, they can expect blowback. I mean,

469
00:23:43,800 --> 00:23:48,600
Speaker 15: what we've seen recently in other breaks is people Republicans, Democrats,

470
00:23:48,640 --> 00:23:52,000
Speaker 15: Independence coming to these town halls and really expressing their

471
00:23:52,040 --> 00:23:55,680
Speaker 15: discontent for what they think is a sort of random

472
00:23:55,840 --> 00:24:00,680
Speaker 15: policy when it relates to just about everything. Prices, the

473
00:24:00,800 --> 00:24:04,439
Speaker 15: number of people getting slash in departments like Social Security,

474
00:24:04,880 --> 00:24:08,920
Speaker 15: their fears over Medicaid being cut, and these are all

475
00:24:08,960 --> 00:24:11,080
Speaker 15: things that we are telling them we're going to do.

476
00:24:11,400 --> 00:24:14,680
Speaker 15: So in that regard, I think that you're sort of

477
00:24:15,119 --> 00:24:16,680
Speaker 15: making the bed that you now have.

478
00:24:16,640 --> 00:24:19,440
Speaker 9: To lay in well.

479
00:24:19,480 --> 00:24:21,920
Speaker 2: And so then there's the other side of the partisan

480
00:24:21,960 --> 00:24:24,480
Speaker 2: equation Genie, which is how Democrats are playing this. You

481
00:24:24,480 --> 00:24:27,600
Speaker 2: look at the weekend activity of Senator Bernie Sanders and

482
00:24:27,640 --> 00:24:31,600
Speaker 2: congressom and Alexandria Cossio Cortez as they continue their swing

483
00:24:31,680 --> 00:24:35,639
Speaker 2: across the country. Bernie Sanders at Coachella. Producer James wishing

484
00:24:35,680 --> 00:24:36,479
Speaker 2: we had video of that.

485
00:24:36,720 --> 00:24:37,120
Speaker 3: I too.

486
00:24:37,160 --> 00:24:39,800
Speaker 2: Wish we could share that on Bloomberg TV and on YouTube,

487
00:24:39,800 --> 00:24:43,159
Speaker 2: but they are drawing massive crowds. Genie, is this the

488
00:24:43,200 --> 00:24:44,639
Speaker 2: messaging that is actually working?

489
00:24:46,240 --> 00:24:48,560
Speaker 12: Yeah, they're hoping, and I agree with you and James.

490
00:24:48,600 --> 00:24:51,560
Speaker 12: I wish we had video of Bernie Sanders and Coachella.

491
00:24:51,680 --> 00:24:53,719
Speaker 12: It was very hot. I have no idea if he

492
00:24:53,760 --> 00:24:56,000
Speaker 12: was wearing his mittens or not, but he got quite

493
00:24:56,040 --> 00:25:00,240
Speaker 12: a crowd also in La with Alexandra Acosio Cortes, and

494
00:25:00,320 --> 00:25:04,119
Speaker 12: the message was all about an administration run them up,

495
00:25:04,320 --> 00:25:07,240
Speaker 12: picking up innocent young people off the streets and putting

496
00:25:07,240 --> 00:25:12,080
Speaker 12: them in detention for having a political opinion, destroying the economy,

497
00:25:12,640 --> 00:25:17,200
Speaker 12: breaking the markets, not wanting to support people who are

498
00:25:17,240 --> 00:25:21,959
Speaker 12: on Medicaid despite working at McDonald's and other jobs. And

499
00:25:22,040 --> 00:25:25,679
Speaker 12: so Bernie Sanders has a message, unfortunately for the Democratic Party.

500
00:25:26,080 --> 00:25:28,080
Speaker 12: You know, they don't have a leader right now, so

501
00:25:28,240 --> 00:25:31,800
Speaker 12: he is giving Democrats a way through this. But whether

502
00:25:31,800 --> 00:25:34,120
Speaker 12: they're listening or not is a big question. And by

503
00:25:34,160 --> 00:25:37,040
Speaker 12: the way, we had a sort of split screen with

504
00:25:37,320 --> 00:25:40,000
Speaker 12: Donald Trump at the UFC in Miami as well, so

505
00:25:40,440 --> 00:25:43,360
Speaker 12: they were all out sort of gearing up the crowds

506
00:25:43,400 --> 00:25:43,960
Speaker 12: this weekend.

507
00:25:45,160 --> 00:25:47,639
Speaker 2: Yeah, I wish we had video of that too, entering

508
00:25:47,680 --> 00:25:49,639
Speaker 2: the arena kind of like a fight, er fists in

509
00:25:49,680 --> 00:25:52,920
Speaker 2: the air, Chance of USA. It's just a remarkable moment

510
00:25:52,960 --> 00:25:56,600
Speaker 2: we're in in American politics. Genie, knowing you study politics,

511
00:25:56,600 --> 00:25:58,960
Speaker 2: but you also, of course are professor of political science

512
00:25:58,960 --> 00:26:00,760
Speaker 2: at I own a university and a lot of time

513
00:26:01,359 --> 00:26:03,920
Speaker 2: in higher education. I do want to get your take

514
00:26:03,960 --> 00:26:06,600
Speaker 2: on the headline that just crossed the Bloomberg terminal, Harvard

515
00:26:07,040 --> 00:26:10,879
Speaker 2: rejecting a proposed agreement with the Trump administration, which of

516
00:26:10,920 --> 00:26:14,160
Speaker 2: course has threatened to halt nine billion dollars in funding

517
00:26:14,880 --> 00:26:18,200
Speaker 2: over demands that include things like governance and leadership reforms,

518
00:26:18,240 --> 00:26:22,560
Speaker 2: merit based hiring reform, merit based admissions reform. Harvard University's

519
00:26:22,600 --> 00:26:26,120
Speaker 2: lawyers saying they will not accept this deal, unlike Columbia, which,

520
00:26:26,160 --> 00:26:27,960
Speaker 2: of course, which acquiesced to a lot of demands of

521
00:26:27,960 --> 00:26:28,840
Speaker 2: the Trump administration.

522
00:26:28,880 --> 00:26:30,200
Speaker 3: And I wonder what you make of the news.

523
00:26:31,720 --> 00:26:35,200
Speaker 12: Very welcome news. You know, if Harvard cannot stand up,

524
00:26:36,080 --> 00:26:39,439
Speaker 12: who can amongst the universities in this country. And I

525
00:26:39,480 --> 00:26:43,000
Speaker 12: give the president and the faculty who filed a lawsuit

526
00:26:43,080 --> 00:26:46,720
Speaker 12: credit for this. This is an attempt to undermine the

527
00:26:46,880 --> 00:26:50,520
Speaker 12: freedom to engage in a liberal arts education, free speech.

528
00:26:50,920 --> 00:26:54,159
Speaker 12: Harvard does have issues. They've acknowledged that they've been working

529
00:26:54,160 --> 00:26:58,080
Speaker 12: on issues of anti Semitism, but the fact that Donald

530
00:26:58,119 --> 00:27:02,760
Speaker 12: Trump can threaten to take away their ability to control

531
00:27:02,800 --> 00:27:05,760
Speaker 12: their curriculum and other things unless they abide by his

532
00:27:05,920 --> 00:27:09,240
Speaker 12: wishes is a bridge way too far. And good for

533
00:27:09,320 --> 00:27:12,520
Speaker 12: Harvard for stepping up. I think Princeton and others will

534
00:27:12,520 --> 00:27:15,520
Speaker 12: be inspired by this and the law, and hopefully the

535
00:27:16,000 --> 00:27:18,520
Speaker 12: big shoe law firms will as well going down the road.

536
00:27:20,280 --> 00:27:22,480
Speaker 2: Well, so, Rick, I'll give you a chance to swing

537
00:27:22,520 --> 00:27:24,680
Speaker 2: at this one as well. Is this ultimately a fight

538
00:27:24,720 --> 00:27:28,200
Speaker 2: that Harvard and these universities can win up against administration

539
00:27:28,280 --> 00:27:29,719
Speaker 2: that's threatening to pull funding.

540
00:27:30,760 --> 00:27:31,840
Speaker 6: Well, let's just be clear.

541
00:27:31,960 --> 00:27:37,600
Speaker 15: There is no freedom of speech right to spending taxpayer dollars,

542
00:27:37,760 --> 00:27:40,639
Speaker 15: and that's what this debate is all about. There is

543
00:27:40,680 --> 00:27:44,120
Speaker 15: an enormous amount of taxpayer dollars going into these institutions,

544
00:27:44,520 --> 00:27:47,200
Speaker 15: and it's up to government to decide what uses they are.

545
00:27:47,359 --> 00:27:51,240
Speaker 15: This is where elections matter and they have consequences, and

546
00:27:51,280 --> 00:27:54,520
Speaker 15: the consequences in this election is that Donald Trump wants

547
00:27:54,600 --> 00:27:56,920
Speaker 15: to turn the clock back to a period of time

548
00:27:56,960 --> 00:28:00,760
Speaker 15: when you know, people like minded like Donald Trump coett

549
00:28:00,760 --> 00:28:03,440
Speaker 15: decide what those taxpayer dollars are going to be used for.

550
00:28:03,600 --> 00:28:06,600
Speaker 15: So he can threaten, he can control, but at the

551
00:28:06,680 --> 00:28:10,359
Speaker 15: end of the day, his only real leverage is taking

552
00:28:10,400 --> 00:28:15,399
Speaker 15: away federal funding, and that's a taxpayer issue. So I

553
00:28:15,440 --> 00:28:18,240
Speaker 15: think that at the end of the day, it puts

554
00:28:18,320 --> 00:28:21,640
Speaker 15: universities in a very difficult position. They're used to, you know,

555
00:28:21,720 --> 00:28:25,680
Speaker 15: not being or being insulated against any kind of political pressure,

556
00:28:25,800 --> 00:28:29,000
Speaker 15: and in this case, that's that's not going to work

557
00:28:29,040 --> 00:28:30,719
Speaker 15: for them.

558
00:28:30,960 --> 00:28:33,840
Speaker 2: All right, Rick Davis and Jeanie Shanzeno our political panel

559
00:28:33,960 --> 00:28:36,399
Speaker 2: joining us on this Monday here on Balance of Power.

560
00:28:36,440 --> 00:28:38,320
Speaker 2: Thank you so much, and we still have more coming

561
00:28:38,400 --> 00:28:41,600
Speaker 2: up as we turn to geopolitics. President Trump talked about

562
00:28:41,600 --> 00:28:45,080
Speaker 2: both iron and the Russia Ukraine War in the Oval earlier,

563
00:28:45,080 --> 00:28:47,120
Speaker 2: and we'll have the latest there next. On Bloomberg TV

564
00:28:47,320 --> 00:28:50,160
Speaker 2: and radio.

565
00:28:51,240 --> 00:28:54,720
Speaker 1: You're listening to the Bloomberg Balance of Power podcast. Catch

566
00:28:54,800 --> 00:28:57,840
Speaker 1: us live weekdays at noon and five pm Eastern on

567
00:28:57,960 --> 00:29:01,200
Speaker 1: Alpa Cockley and Android Otto with the boom Burg Business app.

568
00:29:01,360 --> 00:29:04,640
Speaker 1: Listen on demand wherever you get your podcasts, or watch

569
00:29:04,680 --> 00:29:07,160
Speaker 1: us live on YouTube.

570
00:29:07,480 --> 00:29:10,880
Speaker 2: We want to focus on commodities and oil specifically as well.

571
00:29:10,880 --> 00:29:13,280
Speaker 2: With WTI crew down about eight tens ofven percent on

572
00:29:13,320 --> 00:29:16,560
Speaker 2: the day, we're just shy of sixty one dollars a barrel,

573
00:29:16,640 --> 00:29:19,760
Speaker 2: so off the lows we experienced last week, but still

574
00:29:19,920 --> 00:29:23,280
Speaker 2: we're talking about some pretty depressed prices here. And in

575
00:29:23,280 --> 00:29:26,240
Speaker 2: the face of that, some interesting news from OPEC today,

576
00:29:26,800 --> 00:29:29,840
Speaker 2: which has cut its forecast for oil demand globally, not

577
00:29:29,960 --> 00:29:32,360
Speaker 2: just for this year, but next year as well, in

578
00:29:32,400 --> 00:29:34,320
Speaker 2: the face of President Trump's tariffs.

579
00:29:34,840 --> 00:29:36,160
Speaker 3: The cartel projecting.

580
00:29:35,760 --> 00:29:38,640
Speaker 2: An expansion of one point three million barrels a day,

581
00:29:38,720 --> 00:29:41,600
Speaker 2: or approximately one percent percent for each year.

582
00:29:42,000 --> 00:29:44,160
Speaker 3: And we should note that even that reduced.

583
00:29:43,800 --> 00:29:47,160
Speaker 2: Forecast is still higher than other forecasts that are out there.

584
00:29:47,200 --> 00:29:49,640
Speaker 2: So we want to get into this now with Mike mcgloan,

585
00:29:49,680 --> 00:29:53,880
Speaker 2: who covers commodities for a senior commodity strategist at Bloomberg Intelligence,

586
00:29:53,920 --> 00:29:57,280
Speaker 2: live in Miami. So, Mike, even with this reduced forecast,

587
00:29:57,280 --> 00:29:59,200
Speaker 2: do you get the sense that OPEK is still being

588
00:29:59,360 --> 00:30:01,120
Speaker 2: overly op mystic on demand here?

589
00:30:02,360 --> 00:30:05,120
Speaker 9: Yes? I love your question, Kaylee, and your leading. It's perfect.

590
00:30:05,560 --> 00:30:07,720
Speaker 13: They are just catching up to the rest of the world.

591
00:30:07,920 --> 00:30:10,080
Speaker 13: They obviously have a bias for Crudel to go up.

592
00:30:10,280 --> 00:30:13,080
Speaker 13: They're pointing out the facts of what's really happening. Crudel

593
00:30:13,120 --> 00:30:14,760
Speaker 13: is going down because it went up a lot to

594
00:30:14,760 --> 00:30:17,280
Speaker 13: the peak in twenty twenty two, and that shifted some

595
00:30:17,280 --> 00:30:19,680
Speaker 13: of the world ordered that centivies much more supply out

596
00:30:19,680 --> 00:30:22,320
Speaker 13: of the US, which is still the case accesses of supply,

597
00:30:22,400 --> 00:30:24,640
Speaker 13: and by the way, the cost of production US is

598
00:30:24,680 --> 00:30:27,200
Speaker 13: pushing now towards fifty dollars a barrel, so it's kind

599
00:30:27,200 --> 00:30:30,040
Speaker 13: of a gravity pool level. We have declining demand out

600
00:30:30,080 --> 00:30:31,640
Speaker 13: of China, and we have a paradigm shift in the

601
00:30:31,760 --> 00:30:34,160
Speaker 13: world's shifting to ev so this is a perfect storm

602
00:30:34,520 --> 00:30:37,040
Speaker 13: for normal reversion in crudeil. The last twenty years, the

603
00:30:37,040 --> 00:30:39,240
Speaker 13: loads have been around forty dollars a barrel after shooting

604
00:30:39,280 --> 00:30:40,040
Speaker 13: up above one hundred.

605
00:30:40,280 --> 00:30:41,680
Speaker 9: Now it's got a good reason to do that.

606
00:30:41,720 --> 00:30:44,440
Speaker 13: But the bottom line is the US stock market has

607
00:30:44,480 --> 00:30:46,480
Speaker 13: to go up now, and I think Crudel's realizing the

608
00:30:46,480 --> 00:30:48,640
Speaker 13: stock market is probably going to go down, which means

609
00:30:48,640 --> 00:30:50,440
Speaker 13: as amount of time Crudels gets below that.

610
00:30:50,440 --> 00:30:52,920
Speaker 9: Cost of production to shut off those excesses.

611
00:30:54,480 --> 00:30:56,480
Speaker 2: Well, so I guess it becomes a question of policy

612
00:30:56,520 --> 00:30:58,880
Speaker 2: decisions moving forward as well, and at a time when

613
00:30:58,880 --> 00:31:01,480
Speaker 2: opek is adding more so fly onto the market, cutting

614
00:31:01,480 --> 00:31:04,680
Speaker 2: instamand forecast, and President Trump is pushing for more supply

615
00:31:04,760 --> 00:31:06,360
Speaker 2: to come out of the US. Are we just going

616
00:31:06,440 --> 00:31:08,120
Speaker 2: to end up in a world in which we're incredibly

617
00:31:08,160 --> 00:31:10,680
Speaker 2: oversupplied or your producer is going to recognize that and

618
00:31:10,720 --> 00:31:11,880
Speaker 2: make decisions accordingly.

619
00:31:12,720 --> 00:31:14,640
Speaker 13: Yeah, Well, the number one way they really shut off

620
00:31:14,680 --> 00:31:17,120
Speaker 13: all that except supplies for prices to go down, and

621
00:31:17,120 --> 00:31:18,520
Speaker 13: then it'll happen below fifty.

622
00:31:18,680 --> 00:31:20,880
Speaker 9: Usually happens around forty. It's a matter of time.

623
00:31:20,920 --> 00:31:24,080
Speaker 13: But I see the average price of gasoline this country

624
00:31:24,160 --> 00:31:24,880
Speaker 13: is still above three.

625
00:31:24,920 --> 00:31:25,840
Speaker 9: Now it's driving season.

626
00:31:25,840 --> 00:31:27,560
Speaker 13: We'll stay high for a little while, but by this

627
00:31:27,640 --> 00:31:30,200
Speaker 13: time next year or midterms drop to two. It's a

628
00:31:30,240 --> 00:31:34,040
Speaker 13: normal reversion diesel glowing. Lower energy price is also pressure

629
00:31:34,040 --> 00:31:37,200
Speaker 13: on inflation, and the stated goal of the Trumpet administration

630
00:31:37,280 --> 00:31:38,280
Speaker 13: have lower interest rates.

631
00:31:38,360 --> 00:31:40,280
Speaker 9: So three, it's just a matter of time. The whole

632
00:31:40,320 --> 00:31:41,320
Speaker 9: tilt is going that way.

633
00:31:41,480 --> 00:31:43,040
Speaker 13: I don't see what stops it, but I'll tell you

634
00:31:43,120 --> 00:31:46,560
Speaker 13: prerequisite for just stable stability, stock market has to stay up.

635
00:31:46,720 --> 00:31:49,720
Speaker 13: And if it continues downward, which Bloomer Economics base views

636
00:31:49,720 --> 00:31:51,920
Speaker 13: will drop down to four thousand s and B five hundred,

637
00:31:52,080 --> 00:31:54,600
Speaker 13: about another twenty percent. In the case of recession, we're

638
00:31:54,640 --> 00:31:57,200
Speaker 13: going to get normal deflation from the inflation.

639
00:31:57,360 --> 00:31:58,560
Speaker 9: That's the trend right now.

640
00:31:59,840 --> 00:32:02,200
Speaker 2: Well, and then of course there's the unknown factors to

641
00:32:02,200 --> 00:32:05,920
Speaker 2: consider here, including geopolitical factors. Mike, just quickly, as we

642
00:32:05,960 --> 00:32:09,440
Speaker 2: heard President Trump today talking about ongoing talks with Iran

643
00:32:09,480 --> 00:32:12,719
Speaker 2: over its nuclear program, if that somehow results in sanction

644
00:32:12,960 --> 00:32:16,080
Speaker 2: relief in more Iranian crude coming onto the market at

645
00:32:16,080 --> 00:32:18,080
Speaker 2: a time when these other dynamics we just discussed, or

646
00:32:18,080 --> 00:32:19,600
Speaker 2: and play, what would the impact of that be.

647
00:32:20,360 --> 00:32:23,240
Speaker 9: Perfect storm, The risk is there some kind of supply shock.

648
00:32:23,400 --> 00:32:26,200
Speaker 13: Krudeo basically needs a supply shock to go up, like

649
00:32:26,240 --> 00:32:28,680
Speaker 13: the grains need some kind of drought supply shock to

650
00:32:28,720 --> 00:32:31,520
Speaker 13: go up. Otherwise they're heading towards low price cures. So

651
00:32:31,600 --> 00:32:32,840
Speaker 13: you describe the whole trajectory.

652
00:32:32,840 --> 00:32:33,000
Speaker 10: Now.

653
00:32:33,000 --> 00:32:35,000
Speaker 13: The thing is everybody agrees with it. It was a little

654
00:32:35,000 --> 00:32:36,400
Speaker 13: bit difficult when it was at one hundred and it

655
00:32:36,440 --> 00:32:38,600
Speaker 13: was heading lower. Now that we're heading towards heading at

656
00:32:38,600 --> 00:32:40,560
Speaker 13: sixty and lower, everybody agrees.

657
00:32:40,320 --> 00:32:41,680
Speaker 9: Which is a bit of a bullsh factor.

658
00:32:41,720 --> 00:32:45,120
Speaker 13: But overall, the trends are very bad for very good

659
00:32:45,240 --> 00:32:46,360
Speaker 13: for lower energy prices.

660
00:32:46,520 --> 00:32:48,200
Speaker 9: With it that way, consumers love it. It's all good

661
00:32:48,200 --> 00:32:50,440
Speaker 9: for consumers, all right.

662
00:32:50,480 --> 00:32:53,560
Speaker 2: Mike mcloon of Bloomberg Intelligence joining us from Miami, Thank

663
00:32:53,600 --> 00:32:55,680
Speaker 2: you so much, and I want to focus more on

664
00:32:55,760 --> 00:32:58,160
Speaker 2: the subject of Iran. Now, of course, there were talks

665
00:32:58,200 --> 00:33:01,000
Speaker 2: held on Saturday in Oman between the US and around

666
00:33:01,000 --> 00:33:04,120
Speaker 2: the highest level diplomatic effort to address its nuclear program

667
00:33:04,120 --> 00:33:08,080
Speaker 2: we've seen in years, and while not much tangible, necessarily

668
00:33:08,120 --> 00:33:11,520
Speaker 2: was yielded by Steve Whitcoff, the Trump Administration's middlely so envoys,

669
00:33:11,560 --> 00:33:14,760
Speaker 2: meeting with the Iranian foreign minister. We did get confirmation

670
00:33:14,840 --> 00:33:17,040
Speaker 2: that there will be a second meeting that will happen

671
00:33:17,080 --> 00:33:21,640
Speaker 2: in Italy this coming Saturday. So is that alone enough

672
00:33:21,640 --> 00:33:24,680
Speaker 2: of a sign of progress on that? Returned to Michael Allen,

673
00:33:24,720 --> 00:33:26,840
Speaker 2: who was here with me in our Washington, d C studio.

674
00:33:26,880 --> 00:33:30,200
Speaker 2: He's managing director of Beacon Global Strategies, also former Special

675
00:33:30,240 --> 00:33:33,880
Speaker 2: Assistant to President George W. Bush in the national security sector.

676
00:33:33,920 --> 00:33:35,840
Speaker 2: Good to see you as always, Thanks for being here

677
00:33:35,880 --> 00:33:38,840
Speaker 2: on Bloomberg TV and radio. Is the idea that we're

678
00:33:38,840 --> 00:33:41,840
Speaker 2: having another round of talks in and of itself enough

679
00:33:41,880 --> 00:33:44,480
Speaker 2: progress to you? Or should we have had more come

680
00:33:44,480 --> 00:33:45,480
Speaker 2: out of this meeting.

681
00:33:45,720 --> 00:33:48,600
Speaker 14: I guess it's progress to say that we've talked enough

682
00:33:48,640 --> 00:33:51,000
Speaker 14: to at least have a second meeting, But at some

683
00:33:51,120 --> 00:33:52,640
Speaker 14: point we really need to get to.

684
00:33:52,640 --> 00:33:54,560
Speaker 6: The details of what they're discussing.

685
00:33:54,920 --> 00:33:57,760
Speaker 14: I want to make sure, at least from my vantage point,

686
00:33:57,840 --> 00:34:01,880
Speaker 14: that Whitcoff is very serious about urin enrichment. He seemed

687
00:34:01,880 --> 00:34:04,600
Speaker 14: to say the red line was only weaponization, which is

688
00:34:04,640 --> 00:34:08,080
Speaker 14: the process by which you fashion a bomb out of

689
00:34:08,160 --> 00:34:11,240
Speaker 14: highly enriched uranium that's called weapons grade.

690
00:34:11,360 --> 00:34:12,840
Speaker 6: So I want to make.

691
00:34:12,680 --> 00:34:16,120
Speaker 14: Sure that we have a lot of expert technical expertise

692
00:34:16,200 --> 00:34:18,640
Speaker 14: into what they're talking about, because if we want to

693
00:34:18,640 --> 00:34:21,400
Speaker 14: be a deal too badly, we're going to get a

694
00:34:21,400 --> 00:34:21,879
Speaker 14: bad deal.

695
00:34:22,000 --> 00:34:24,240
Speaker 2: Well, we heard President Trump in the Oval Office earlier

696
00:34:24,320 --> 00:34:26,759
Speaker 2: this afternoon saying that Iran has to get rid of

697
00:34:26,800 --> 00:34:29,799
Speaker 2: the concept of a nuclear weapon. They cannot have a

698
00:34:29,880 --> 00:34:32,279
Speaker 2: nuclear weapon. But you're suggesting it shouldn't just be about

699
00:34:32,320 --> 00:34:33,160
Speaker 2: the weapon itself.

700
00:34:33,360 --> 00:34:34,080
Speaker 6: Yeah, that's right.

701
00:34:34,160 --> 00:34:38,120
Speaker 14: I think if they continue to specialize in how to

702
00:34:38,200 --> 00:34:41,480
Speaker 14: make weapons grade uranium, that's a skill that you're not

703
00:34:41,600 --> 00:34:45,399
Speaker 14: going to forget. It's a learned technical skill that will

704
00:34:45,440 --> 00:34:48,719
Speaker 14: be with them forever. And so we'll always constantly be

705
00:34:48,760 --> 00:34:51,640
Speaker 14: trying to figure out are you burrowing into a new

706
00:34:51,640 --> 00:34:55,120
Speaker 14: mountain like they've done on two occasions to build centrifuge halls,

707
00:34:55,360 --> 00:34:58,560
Speaker 14: and what are you doing on weaponization? That's much harder

708
00:34:58,600 --> 00:35:01,719
Speaker 14: to track than a huge centri huge hall. So if

709
00:35:01,760 --> 00:35:05,080
Speaker 14: any deal results, it has to have any time, any

710
00:35:05,200 --> 00:35:09,560
Speaker 14: place inspections by the UN's watchdog agency, which is called

711
00:35:09,600 --> 00:35:15,080
Speaker 14: the IAEA. That's absolutely a fundamental part of any agreement

712
00:35:15,200 --> 00:35:17,560
Speaker 14: to be able to check Iran.

713
00:35:17,239 --> 00:35:18,000
Speaker 6: And what they're up to.

714
00:35:18,320 --> 00:35:21,879
Speaker 2: Well, so what position is Iran in coming in to this? Then,

715
00:35:21,880 --> 00:35:24,080
Speaker 2: when we're considering what an agreement could look like, Knowing

716
00:35:24,120 --> 00:35:27,040
Speaker 2: we've had many conversations with you, included about how it's

717
00:35:27,080 --> 00:35:29,320
Speaker 2: been weakened by the weakness of its proxies in the

718
00:35:29,360 --> 00:35:32,320
Speaker 2: face of ongoing fights with Israel or the US striking

719
00:35:32,360 --> 00:35:34,920
Speaker 2: the Huthis, what have you? Are they weakened enough that

720
00:35:34,920 --> 00:35:37,399
Speaker 2: they would actually agree to something that arguably, you could

721
00:35:37,440 --> 00:35:40,399
Speaker 2: say Iran might not see as super favorable to its

722
00:35:40,400 --> 00:35:41,000
Speaker 2: interesting So.

723
00:35:40,960 --> 00:35:45,600
Speaker 14: I'm worried they're not enough adversely affected quite yet. Remember

724
00:35:45,680 --> 00:35:48,239
Speaker 14: last time, in the first Trump administration, there was a

725
00:35:48,280 --> 00:35:52,760
Speaker 14: long period of what they call massive sanctions and max pressure,

726
00:35:53,280 --> 00:35:57,480
Speaker 14: and honestly, I don't know that the Iranians felt it

727
00:35:57,640 --> 00:36:00,239
Speaker 14: enough or I think they're willing to really take some

728
00:36:00,360 --> 00:36:03,439
Speaker 14: serious pain before they're going to deal in a very

729
00:36:03,480 --> 00:36:06,879
Speaker 14: substantial way on the things that we care about very much.

730
00:36:07,120 --> 00:36:09,520
Speaker 14: And then, of course, as we've talked about with you before,

731
00:36:09,920 --> 00:36:13,120
Speaker 14: is the wild card of Israel. Israel may be much

732
00:36:13,200 --> 00:36:16,560
Speaker 14: less trustworthy of an Iranian deal than Trump might be.

733
00:36:16,920 --> 00:36:18,840
Speaker 6: And so what do they do. Do they decide to

734
00:36:18,840 --> 00:36:19,480
Speaker 6: go ahead.

735
00:36:19,280 --> 00:36:21,799
Speaker 14: And use military action, And I think that's something that's

736
00:36:21,920 --> 00:36:24,280
Speaker 14: a serious possibility this calendar gear.

737
00:36:24,120 --> 00:36:26,480
Speaker 2: Well, there's also the question of US military action too.

738
00:36:26,560 --> 00:36:30,040
Speaker 2: President Trump was asked by a reporter today about that.

739
00:36:30,160 --> 00:36:32,000
Speaker 2: He said, if we have to do something harsh, we'll

740
00:36:32,000 --> 00:36:33,880
Speaker 2: do it. Then, when he was asked specifically if that

741
00:36:33,920 --> 00:36:37,320
Speaker 2: could include a strike on Iranian nuclear facilities, he said,

742
00:36:37,920 --> 00:36:40,360
Speaker 2: of course it does. Do you see that as actually

743
00:36:40,400 --> 00:36:42,080
Speaker 2: a likely possible scenario?

744
00:36:42,239 --> 00:36:43,560
Speaker 6: I think it's possible.

745
00:36:43,760 --> 00:36:46,480
Speaker 14: I think his predominant view is what he said in

746
00:36:46,560 --> 00:36:49,520
Speaker 14: his inaugural that he wants to have fewer wars, not more,

747
00:36:49,640 --> 00:36:51,799
Speaker 14: and not getting in another war in the Middle East

748
00:36:51,880 --> 00:36:53,920
Speaker 14: is one of his chief aims. But at the same time,

749
00:36:54,040 --> 00:36:58,239
Speaker 14: he has set the theater with B two bombers, extra carriers,

750
00:36:58,320 --> 00:37:01,200
Speaker 14: a lot of military force. I think that's more to

751
00:37:01,320 --> 00:37:05,800
Speaker 14: reinforce Steve Whitkoff's hand as he negotiates diplomatically.

752
00:37:06,200 --> 00:37:07,840
Speaker 6: But I wouldn't rule it out.

753
00:37:07,719 --> 00:37:10,000
Speaker 14: Because I think if President Trump feels like if he's

754
00:37:10,000 --> 00:37:13,960
Speaker 14: disrespected or Iran doesn't take this seriously, he might go

755
00:37:14,080 --> 00:37:14,439
Speaker 14: for it.

756
00:37:14,560 --> 00:37:16,520
Speaker 2: I wonder if you feel that the President might be

757
00:37:16,600 --> 00:37:19,279
Speaker 2: disrespected by what we saw take place in Ukraine over

758
00:37:19,320 --> 00:37:21,959
Speaker 2: the weekend. Knowing to your point on him not being

759
00:37:21,960 --> 00:37:23,960
Speaker 2: a fan of wars, he very much wants to see

760
00:37:23,960 --> 00:37:26,720
Speaker 2: a negotiated outcome between Russia and Ukraine.

761
00:37:26,800 --> 00:37:27,880
Speaker 3: He wants the war to end.

762
00:37:27,920 --> 00:37:30,719
Speaker 2: And yet on Palm Sunday, Russia strikes inside Ukraine kills

763
00:37:30,719 --> 00:37:33,240
Speaker 2: more than thirty people, even as there are these efforts

764
00:37:33,560 --> 00:37:35,960
Speaker 2: towards some kind of peace deal. Does that signal to

765
00:37:36,000 --> 00:37:37,920
Speaker 2: you that Putin is not taking this seriously? And what

766
00:37:37,920 --> 00:37:38,960
Speaker 2: does that mean for the president?

767
00:37:39,040 --> 00:37:41,759
Speaker 14: I don't think Putin is taking it very very seriously.

768
00:37:41,920 --> 00:37:44,680
Speaker 14: I think Putin is behaving like he has the whole time.

769
00:37:44,760 --> 00:37:49,279
Speaker 14: He did a deliberate attack on a civilian gathering on

770
00:37:49,400 --> 00:37:52,080
Speaker 14: Palm Sunday. I think this is par for the course

771
00:37:52,120 --> 00:37:55,120
Speaker 14: for him. I don't want us to bend over backwards

772
00:37:55,160 --> 00:37:57,719
Speaker 14: trying to get a deal with Putin. I think it's

773
00:37:57,760 --> 00:38:01,280
Speaker 14: fine that Witkoff is there trying to established some basic

774
00:38:01,400 --> 00:38:04,080
Speaker 14: rapport with Vladimir Putin. But at the end of the day,

775
00:38:04,120 --> 00:38:07,120
Speaker 14: I think the President might be a little bit too

776
00:38:07,280 --> 00:38:10,239
Speaker 14: saying it was everyone's fault here. I think he ought

777
00:38:10,280 --> 00:38:13,520
Speaker 14: to assign more blame to where it properly.

778
00:38:13,760 --> 00:38:14,759
Speaker 6: Resigns well.

779
00:38:14,800 --> 00:38:16,719
Speaker 2: On the subject of blame, we heard from him in

780
00:38:16,719 --> 00:38:18,560
Speaker 2: the Oval office, and it was an echo of what

781
00:38:18,600 --> 00:38:21,760
Speaker 2: he had already posted on true social the war between

782
00:38:21,840 --> 00:38:24,399
Speaker 2: Russia and Ukraine is Biden's.

783
00:38:23,840 --> 00:38:25,480
Speaker 3: War, Yeah, not mine.

784
00:38:25,640 --> 00:38:27,680
Speaker 2: What do you make of that language? This isn't language

785
00:38:27,719 --> 00:38:30,160
Speaker 2: we've heard from him before. He's noted frequently that this

786
00:38:30,239 --> 00:38:32,920
Speaker 2: war did not start under his presidency, which yes, is true.

787
00:38:32,920 --> 00:38:35,680
Speaker 2: But to characterize it as Biden's.

788
00:38:35,160 --> 00:38:37,360
Speaker 14: War, yeah, I thought he was in a lot of

789
00:38:37,360 --> 00:38:39,960
Speaker 14: different places. In that press conference, he also seemed for

790
00:38:40,000 --> 00:38:42,880
Speaker 14: a second to say that it was Zelenski's fault that

791
00:38:42,920 --> 00:38:44,120
Speaker 14: they were even in the war.

792
00:38:44,320 --> 00:38:47,239
Speaker 2: He suggested Ukraine started a war with the country twenty

793
00:38:47,280 --> 00:38:48,359
Speaker 2: times its size.

794
00:38:48,000 --> 00:38:50,320
Speaker 14: But then he cleared it up by saying I blame

795
00:38:50,400 --> 00:38:52,560
Speaker 14: all three of them, and he at least rang Zelensky

796
00:38:53,160 --> 00:38:55,799
Speaker 14: in third place on that occasion. But I do think

797
00:38:55,840 --> 00:38:58,480
Speaker 14: that he's worried about the messages that he sends to

798
00:38:58,520 --> 00:39:02,440
Speaker 14: Vladimir Putin. He's trying to ties him into a serious negotiation.

799
00:39:02,640 --> 00:39:05,759
Speaker 14: So that might explain what Trump is up to when

800
00:39:05,800 --> 00:39:08,680
Speaker 14: he's trying to explain exactly what happened yesterday.

801
00:39:08,800 --> 00:39:12,720
Speaker 2: So you think it's more about positioning himself for ongoing negotiations,

802
00:39:12,760 --> 00:39:15,759
Speaker 2: not that negotiations which he previously contended would take him

803
00:39:15,760 --> 00:39:18,799
Speaker 2: a day to sort out, aren't necessarily going his way,

804
00:39:18,840 --> 00:39:20,719
Speaker 2: and he's trying to blame to his predecessor.

805
00:39:20,800 --> 00:39:23,160
Speaker 14: I think, oh, on the Biden thing, I definitely think

806
00:39:23,200 --> 00:39:25,839
Speaker 14: he's trying to say, hey, listen, Biden mismanaged this thing

807
00:39:25,920 --> 00:39:29,759
Speaker 14: all along. He poured gasoline on a raging fire. At

808
00:39:29,840 --> 00:39:31,880
Speaker 14: least I'm the one that's trying to make peace.

809
00:39:31,680 --> 00:39:32,600
Speaker 3: Here, okay.

810
00:39:32,640 --> 00:39:34,319
Speaker 2: And he's not just trying to make peace, he's also

811
00:39:34,360 --> 00:39:36,800
Speaker 2: trying to reach an economic deal with Ukraine on minerals

812
00:39:36,800 --> 00:39:40,360
Speaker 2: still a draft that obviously has been revised multiple times.

813
00:39:40,400 --> 00:39:42,839
Speaker 2: Do you think that will be resolved soon and if

814
00:39:42,840 --> 00:39:45,040
Speaker 2: it is, what ultimately does that open up?

815
00:39:45,280 --> 00:39:47,520
Speaker 14: So I think it helps a little bit because it

816
00:39:47,600 --> 00:39:50,640
Speaker 14: helps with what Donald Trump is worried about, which is

817
00:39:50,840 --> 00:39:53,360
Speaker 14: has the United States been taken advantage of? Have we

818
00:39:53,520 --> 00:39:56,839
Speaker 14: overpaid for the defense of Ukraine. So I still think

819
00:39:56,880 --> 00:40:01,399
Speaker 14: it helps Ukraine in the sense that President Trump will

820
00:40:01,440 --> 00:40:03,640
Speaker 14: be able to say, you know what, we've gotten at

821
00:40:03,719 --> 00:40:06,960
Speaker 14: least some of our money repaid here. I know Zelensky

822
00:40:06,960 --> 00:40:09,200
Speaker 14: objects to that because he says that was a grant

823
00:40:09,239 --> 00:40:11,759
Speaker 14: and it was. But I think some of this is

824
00:40:11,840 --> 00:40:14,640
Speaker 14: just the politics of America first here in the United States,

825
00:40:14,640 --> 00:40:17,960
Speaker 14: and the President, in every relationship from tariffs to Iran,

826
00:40:18,080 --> 00:40:19,759
Speaker 14: is trying to make sure the United States gets a

827
00:40:19,800 --> 00:40:22,080
Speaker 14: good deal. So if he feels like we're being repaid

828
00:40:22,120 --> 00:40:23,239
Speaker 14: a little bit, I'm okay with that.

829
00:40:23,600 --> 00:40:26,000
Speaker 2: We heard from President Zelensky. He sat down for an

830
00:40:26,000 --> 00:40:28,319
Speaker 2: interview with sixty Minutes which aired last night, in which

831
00:40:28,360 --> 00:40:31,440
Speaker 2: he invited President Trump again to come to Ukraine and

832
00:40:31,480 --> 00:40:33,799
Speaker 2: see for himself the devastation that has been wrought by

833
00:40:33,840 --> 00:40:37,480
Speaker 2: this years long war. Do you think there's any scenario

834
00:40:37,480 --> 00:40:39,560
Speaker 2: in which President Trump actually makes that trip.

835
00:40:39,920 --> 00:40:43,759
Speaker 14: I really don't, unless it was for some crowning achievement

836
00:40:43,800 --> 00:40:46,560
Speaker 14: at the end of a longer negotiation, and that was

837
00:40:46,640 --> 00:40:48,680
Speaker 14: part of it all. I don't see it in the

838
00:40:48,719 --> 00:40:49,720
Speaker 14: cards for right now.

839
00:40:50,280 --> 00:40:52,520
Speaker 3: Do you see a deal in the cards for right now?

840
00:40:52,640 --> 00:40:54,160
Speaker 3: Or we're getting.

841
00:40:53,840 --> 00:40:57,000
Speaker 2: Overly optimistic with the speed with which this process could

842
00:40:57,040 --> 00:40:57,600
Speaker 2: actually work.

843
00:40:57,719 --> 00:40:59,960
Speaker 14: So I think we're overly optimistic if we think we're

844
00:41:00,080 --> 00:41:02,239
Speaker 14: going to get all the way to a peace agreement.

845
00:41:02,360 --> 00:41:04,120
Speaker 6: So there's a spectrum. For me.

846
00:41:04,320 --> 00:41:06,600
Speaker 14: I think it's more likely you get some sort of

847
00:41:07,080 --> 00:41:12,160
Speaker 14: ceasefire that maybe is occasionally violated and we muddle through

848
00:41:12,200 --> 00:41:14,439
Speaker 14: for some period of time. I think that's more likely

849
00:41:14,520 --> 00:41:17,279
Speaker 14: than a full scale peace agreement, and that might be

850
00:41:17,320 --> 00:41:19,319
Speaker 14: good enough for Trump in the end, because look how

851
00:41:19,320 --> 00:41:21,799
Speaker 14: hard it is even to try and get them to

852
00:41:22,040 --> 00:41:24,520
Speaker 14: live up to the terms of the very modest ceasefire

853
00:41:24,600 --> 00:41:28,040
Speaker 14: they have today on energy resources and the Black Sea.

854
00:41:28,160 --> 00:41:29,960
Speaker 2: But how do we get to any kind of agreement

855
00:41:30,000 --> 00:41:33,200
Speaker 2: on any peacekeeping force that would maintain a ceasefire, even

856
00:41:33,239 --> 00:41:35,640
Speaker 2: if it was just a kind of limited, muddled one.

857
00:41:35,719 --> 00:41:37,000
Speaker 6: Yeah, I'm worried about that too.

858
00:41:37,200 --> 00:41:40,920
Speaker 14: I think we've of course rejected that Ukraine would be

859
00:41:40,960 --> 00:41:45,080
Speaker 14: in NATO. It seems like it's increasingly unlikely that we'll

860
00:41:45,080 --> 00:41:48,760
Speaker 14: have NATO European allies inside of Ukraine. Where I think

861
00:41:48,880 --> 00:41:50,520
Speaker 14: and I hope we're going to go in terms of

862
00:41:50,520 --> 00:41:54,880
Speaker 14: security guarantees, is some longer term commitment, maybe not sixty

863
00:41:54,880 --> 00:41:57,880
Speaker 14: billion dollars a year, but some sort of commitment to

864
00:41:58,040 --> 00:42:01,960
Speaker 14: Ukraine that will continue to fund your military at some level,

865
00:42:02,160 --> 00:42:05,279
Speaker 14: at least up until the point where the Europeans can

866
00:42:05,440 --> 00:42:08,160
Speaker 14: really step up in a larger way. Now, maybe it's hopeful,

867
00:42:08,239 --> 00:42:10,560
Speaker 14: but I think at some point we have to acknowledge

868
00:42:10,560 --> 00:42:14,080
Speaker 14: that Ukraine has real security needs and we ought to

869
00:42:14,120 --> 00:42:14,759
Speaker 14: try and meet them.

870
00:42:14,840 --> 00:42:17,440
Speaker 2: All right, Michael Allen, appreciate it as always joining us

871
00:42:17,440 --> 00:42:21,400
Speaker 2: from Beacon Global Strategies. I'm the latest on geopolitics.

872
00:42:25,560 --> 00:42:28,000
Speaker 6: Thanks for listening to the Balance of Power podcast.

873
00:42:28,600 --> 00:42:31,040
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874
00:42:31,160 --> 00:42:31,719
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875
00:42:31,840 --> 00:42:34,399
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876
00:42:34,480 --> 00:42:37,720
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877
00:42:38,000 --> 00:42:39,400
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