1 00:00:00,120 --> 00:00:13,200 Speaker 1: Bloomberg Audio Studios, podcasts, radio news. This is the Bloomberg 2 00:00:13,240 --> 00:00:17,560 Speaker 1: Surveillance Podcast. Catch us live weekdays at seven am Eastern 3 00:00:17,680 --> 00:00:21,280 Speaker 1: on applecar Player, Android Auto with the Bloomberg Business App. 4 00:00:21,560 --> 00:00:24,800 Speaker 1: Listen on demand wherever you get your podcasts, or watch 5 00:00:24,840 --> 00:00:26,239 Speaker 1: us live on YouTube. 6 00:00:26,480 --> 00:00:29,200 Speaker 2: Listen an important discussion and Bob Woodward yesterday and our 7 00:00:29,280 --> 00:00:32,800 Speaker 2: piercing conversation. Thanks for the many comments there, particularly from 8 00:00:32,840 --> 00:00:37,480 Speaker 2: Trump supporters that felt mister Woodward was supporting the other team. 9 00:00:38,440 --> 00:00:41,000 Speaker 2: And to have Tina Fordham with us right now. Fordham 10 00:00:41,000 --> 00:00:44,120 Speaker 2: Global Insights is important. Off what Bob Woodward said yesterday 11 00:00:44,600 --> 00:00:48,000 Speaker 2: that the Secretary Defense of the Biden administration has an 12 00:00:48,000 --> 00:00:52,120 Speaker 2: affinity for the Vice President of the United States, Tinas. 13 00:00:52,159 --> 00:00:55,640 Speaker 2: I know you know in Foreign Affairs magazine the Secretary 14 00:00:55,800 --> 00:00:59,920 Speaker 2: of Defense writing and of course is extreme concern about 15 00:01:00,600 --> 00:01:05,440 Speaker 2: Ukraine and quote Putin's aggression unquote. The Secretary of Defense 16 00:01:05,520 --> 00:01:11,600 Speaker 2: goes the frauds and falsehoods of the Kremlin apologists. What 17 00:01:11,640 --> 00:01:14,679 Speaker 2: does the Department of Defense and our foreign policy projection 18 00:01:14,880 --> 00:01:17,840 Speaker 2: look like, whether Trump or Harris Victory. 19 00:01:20,480 --> 00:01:23,399 Speaker 3: Well, I think we should admit to start with it. 20 00:01:23,480 --> 00:01:27,040 Speaker 3: As we've gotten closer to polling day. In the US, 21 00:01:27,920 --> 00:01:33,399 Speaker 3: the sounding the alarm about the risks of Trump and 22 00:01:33,440 --> 00:01:38,240 Speaker 3: the White House have increased, and the Defense Secretary is 23 00:01:38,319 --> 00:01:41,240 Speaker 3: talking about the fact that Trump has said that he 24 00:01:41,280 --> 00:01:44,880 Speaker 3: would end the war in Ukraine on day one. He 25 00:01:44,920 --> 00:01:48,120 Speaker 3: hasn't said how he would do that. But what is 26 00:01:48,440 --> 00:01:52,000 Speaker 3: likely the biggest foreign policy implication in the short term 27 00:01:52,080 --> 00:01:54,480 Speaker 3: of Trump and the White House has got to be 28 00:01:55,840 --> 00:01:59,680 Speaker 3: his promised end to military aid to Ukraine. Even though 29 00:01:59,680 --> 00:02:03,560 Speaker 3: you're has done a lot and done it quickly in 30 00:02:03,720 --> 00:02:06,640 Speaker 3: European Union terms, and the UK has been very involved 31 00:02:06,680 --> 00:02:10,960 Speaker 3: in this, it won't be possible to replace that aid 32 00:02:11,480 --> 00:02:14,800 Speaker 3: in time. And you know, Putin's been playing a waiting 33 00:02:14,880 --> 00:02:17,359 Speaker 3: game when it comes to Ukraine, and he's been much 34 00:02:17,400 --> 00:02:20,399 Speaker 3: more active when it comes to US elections. 35 00:02:21,360 --> 00:02:23,680 Speaker 4: Tina, you're based in London. I'd love to get a 36 00:02:23,800 --> 00:02:26,600 Speaker 4: sense of kind of what the folks in the UK 37 00:02:26,680 --> 00:02:30,800 Speaker 4: are thinking about this election, how closely they're paying attention 38 00:02:30,840 --> 00:02:33,240 Speaker 4: to it, how do they view potential outcomes. 39 00:02:35,760 --> 00:02:37,920 Speaker 3: Well, I mean, I guess I have a bit of 40 00:02:37,919 --> 00:02:41,960 Speaker 3: a you know, self selected crowd around me. My phone 41 00:02:42,040 --> 00:02:46,080 Speaker 3: is lighting up constantly today and in the UK people 42 00:02:46,400 --> 00:02:50,400 Speaker 3: feel very close to the United States and so there's 43 00:02:50,600 --> 00:02:53,400 Speaker 3: you know, affinity and concern on that front, and of 44 00:02:53,400 --> 00:02:57,639 Speaker 3: course in the markets, our investor clients and corporate clients 45 00:02:58,320 --> 00:03:00,520 Speaker 3: are really on the edge of their seats about this. 46 00:03:00,800 --> 00:03:05,600 Speaker 3: It's impossible to position for an election as close as this, 47 00:03:05,760 --> 00:03:08,600 Speaker 3: as Tom was saying at the start, but there is 48 00:03:08,800 --> 00:03:13,120 Speaker 3: enormous anxiety and it's pretty much across the board about 49 00:03:13,120 --> 00:03:15,840 Speaker 3: what it would mean for the UK and Europe to 50 00:03:15,919 --> 00:03:18,240 Speaker 3: have Trump back in the White House. And I think 51 00:03:18,240 --> 00:03:22,399 Speaker 3: there's been less consideration really about what a Harris presidency 52 00:03:22,680 --> 00:03:28,760 Speaker 3: would mean, apart from the expectation of continuity on NATO, Alcus, 53 00:03:29,400 --> 00:03:32,840 Speaker 3: you know, the security umbrella in Asia. 54 00:03:34,320 --> 00:03:37,040 Speaker 4: What have you heard, if anything, from some of the 55 00:03:37,200 --> 00:03:41,440 Speaker 4: European leaders about a potential second Trump presidency in terms 56 00:03:41,520 --> 00:03:44,720 Speaker 4: of just geopolitics in general. Again, as as you mentioned, 57 00:03:44,760 --> 00:03:46,720 Speaker 4: there's so many hotspots around the world, from the Middle 58 00:03:46,760 --> 00:03:51,119 Speaker 4: East to Ukraine. What would that mean. 59 00:03:50,920 --> 00:03:55,920 Speaker 3: Potentially, Well, European elected officials will be at great pains 60 00:03:56,000 --> 00:03:59,320 Speaker 3: not to say anything because you know, they don't want 61 00:03:59,320 --> 00:04:03,160 Speaker 3: to be seen to be interfering in the elections. But 62 00:04:03,440 --> 00:04:06,400 Speaker 3: there has been no secret about the fact that Brussels, 63 00:04:06,520 --> 00:04:10,920 Speaker 3: for example, has been trying to trunk proof Europe, and 64 00:04:10,960 --> 00:04:15,280 Speaker 3: that's the term that's been used, and that relates particularly 65 00:04:15,320 --> 00:04:19,240 Speaker 3: to security and defense, as mentioned, But I think the 66 00:04:19,279 --> 00:04:21,840 Speaker 3: other angle here, I mean, the obvious one is security 67 00:04:21,880 --> 00:04:24,599 Speaker 3: and defense, and it matters enormously. But the other angle 68 00:04:24,640 --> 00:04:28,600 Speaker 3: about why these US elections are being watched so closely 69 00:04:28,640 --> 00:04:33,720 Speaker 3: and with so much anxiety is simply around the question 70 00:04:33,839 --> 00:04:37,840 Speaker 3: about whether the US can have a peaceful transition. And 71 00:04:37,920 --> 00:04:40,680 Speaker 3: I was very interested to see some polling data from 72 00:04:40,720 --> 00:04:45,280 Speaker 3: the AP that talked about four and ten Americans are 73 00:04:45,360 --> 00:04:51,839 Speaker 3: concerned about violent interference with elections. That's alarming. So I 74 00:04:51,880 --> 00:04:56,120 Speaker 3: think the biggest litmus test is the functioning of our 75 00:04:56,200 --> 00:05:00,120 Speaker 3: institutions and the acquiescence of whoever loses. 76 00:05:00,880 --> 00:05:04,440 Speaker 2: One of the great changes here at Tina from twenty 77 00:05:04,640 --> 00:05:09,479 Speaker 2: sixteen to twenty twenty to twenty twenty four, way beneath 78 00:05:09,520 --> 00:05:14,160 Speaker 2: the fold in America, nobody's paying attention is ninety six 79 00:05:14,279 --> 00:05:20,160 Speaker 2: miles from the Russian border in Finland Lapland, the United 80 00:05:20,200 --> 00:05:26,520 Speaker 2: States is leading NATO artillery exercises. That's something I would 81 00:05:26,560 --> 00:05:29,400 Speaker 2: not have said four years ago or eight years ago. 82 00:05:29,760 --> 00:05:35,360 Speaker 2: What is the significance of NATO artillery exercises? A Cuba 83 00:05:35,400 --> 00:05:37,000 Speaker 2: away from Putin's border. 84 00:05:39,640 --> 00:05:42,560 Speaker 3: Well, that speaks to the fact that we have two 85 00:05:42,960 --> 00:05:47,080 Speaker 3: new NATO member states since Russia decided to invade Ukraine, 86 00:05:47,120 --> 00:05:51,640 Speaker 3: and those are Finland and Sweden. It wasn't expected. I 87 00:05:51,640 --> 00:05:54,119 Speaker 3: suppose even five years ago. I actually had a bet 88 00:05:54,160 --> 00:05:56,839 Speaker 3: with a Swedish banker friend of mine about this, that 89 00:05:56,880 --> 00:06:02,080 Speaker 3: they would both join. But you take an interesting place, Tom, 90 00:06:02,120 --> 00:06:06,560 Speaker 3: which is that one of the sort of open debates 91 00:06:06,600 --> 00:06:11,920 Speaker 3: that's underway is whether those Nordic states would kind of 92 00:06:12,480 --> 00:06:16,720 Speaker 3: form their own and mini NATO if US withdraws its 93 00:06:16,760 --> 00:06:20,000 Speaker 3: support in one form or another. They have strong militaries 94 00:06:20,120 --> 00:06:22,640 Speaker 3: and have had the mandatory draft, and I think a 95 00:06:22,680 --> 00:06:27,360 Speaker 3: lot of Americans don't appreciate how prepared those countries are. 96 00:06:27,480 --> 00:06:32,240 Speaker 3: Finland was at war with Russia, remember, and has a 97 00:06:32,320 --> 00:06:35,880 Speaker 3: memory of being at war to defend their territory. But 98 00:06:36,040 --> 00:06:37,960 Speaker 3: they do rely on US participation. 99 00:06:38,240 --> 00:06:40,279 Speaker 2: This came up last night at the dining room table, 100 00:06:40,760 --> 00:06:45,720 Speaker 2: Tina Fordham. If President Trump wins a second term, where 101 00:06:45,760 --> 00:06:50,640 Speaker 2: does he travel to first? Does he reducts his Pacific travels? 102 00:06:51,279 --> 00:06:54,560 Speaker 2: Does he go to Europe? Will he try to redo 103 00:06:55,279 --> 00:06:56,560 Speaker 2: twenty sixteen? 104 00:06:58,839 --> 00:07:01,440 Speaker 3: So I actually have thought about that before. I love 105 00:07:01,440 --> 00:07:05,320 Speaker 3: a thought experiment, Tom, but I don't think that Trump 106 00:07:05,880 --> 00:07:10,800 Speaker 3: will feel compelled if he's reelected to do the traditional 107 00:07:10,920 --> 00:07:15,640 Speaker 3: calling upon allies. Trump's also not really an ally guy, 108 00:07:16,280 --> 00:07:20,280 Speaker 3: and if we look at his you know, campaign statements, 109 00:07:20,720 --> 00:07:23,640 Speaker 3: they're really focused on the domestic. I mean, my sense 110 00:07:23,760 --> 00:07:28,800 Speaker 3: is that Trump would likely subcontract his foreign policy, trade 111 00:07:28,840 --> 00:07:32,960 Speaker 3: policy to experts who he trusts. Of course, the trouble 112 00:07:33,000 --> 00:07:34,920 Speaker 3: for us is when we try to speculate what that 113 00:07:35,000 --> 00:07:38,000 Speaker 3: looks like that most of the people who worked for 114 00:07:38,080 --> 00:07:42,200 Speaker 3: him before have made it abundantly clear that they would 115 00:07:42,240 --> 00:07:43,880 Speaker 3: never consider doing so again. 116 00:07:44,680 --> 00:07:46,760 Speaker 2: Tina, we got to leave it there. Never enough time, 117 00:07:47,040 --> 00:07:50,000 Speaker 2: Tina Fordham Fordham Global Inside. 118 00:07:54,400 --> 00:07:58,239 Speaker 1: You're listening to the Bloomberg Surveillance Podcast. Catch us live 119 00:07:58,360 --> 00:08:01,680 Speaker 1: weekday afternoons from seven to ten am Easter Listen on 120 00:08:01,720 --> 00:08:04,960 Speaker 1: Apple car Play and Android Otto with a Bloomberg Business app, 121 00:08:05,080 --> 00:08:06,760 Speaker 1: or watch us live on YouTube. 122 00:08:07,040 --> 00:08:09,239 Speaker 2: There are moments in the blur of all this, folks. 123 00:08:09,840 --> 00:08:12,720 Speaker 2: There's moments where any of our wonderful esting guests they 124 00:08:12,760 --> 00:08:16,760 Speaker 2: say one single thing and like it doesn't go away. 125 00:08:16,960 --> 00:08:21,440 Speaker 2: You remember, one hour, one day, one month later, got 126 00:08:21,600 --> 00:08:24,800 Speaker 2: to mccunda said something a while back. I think it 127 00:08:24,840 --> 00:08:28,160 Speaker 2: was I miscot him last time around because I was 128 00:08:28,160 --> 00:08:31,760 Speaker 2: in Europe. But with Yale School of Management said something 129 00:08:31,840 --> 00:08:34,480 Speaker 2: Paul that had carried for weeks and weeks and weeks, 130 00:08:35,000 --> 00:08:39,720 Speaker 2: which is the undecided shrink. They shrink much more, and 131 00:08:39,760 --> 00:08:43,160 Speaker 2: everybody caught up with Professor mccundy. He joins us down 132 00:08:43,160 --> 00:08:47,480 Speaker 2: in studio on this election day. Where are the undecideds? Now? 133 00:08:47,800 --> 00:08:48,880 Speaker 2: They got to decide. 134 00:08:49,440 --> 00:08:52,720 Speaker 5: They have to decide at this point, pulling to everything 135 00:08:52,720 --> 00:08:55,839 Speaker 5: here is guesses and stabs in the dark. But all 136 00:08:55,920 --> 00:08:58,240 Speaker 5: the data I'm seeing suggests that in the last twenty 137 00:08:58,280 --> 00:08:59,920 Speaker 5: four to forty eight hours, even even though I wanted 138 00:08:59,960 --> 00:09:04,880 Speaker 5: to weeks, they've broken pretty strongly towards Harris the really 139 00:09:04,880 --> 00:09:08,160 Speaker 5: decisive moment, and it's strikingly. It's striking So was the 140 00:09:08,200 --> 00:09:11,360 Speaker 5: Madison Square Garden event. There's a lot of polling data 141 00:09:11,360 --> 00:09:14,480 Speaker 5: coming out for Latinos, particularly Latinos in Pennsylvania that they 142 00:09:14,520 --> 00:09:16,880 Speaker 5: all heard about it. It mattered to all of them, 143 00:09:17,320 --> 00:09:20,800 Speaker 5: and it swung a substance. It swung some votes. Now 144 00:09:21,080 --> 00:09:22,640 Speaker 5: I can't tell you that's enough to swing the election 145 00:09:22,760 --> 00:09:25,200 Speaker 5: because there aren't many of those people like that. The 146 00:09:25,280 --> 00:09:27,760 Speaker 5: undecided was last time I was here, it was three percent. 147 00:09:27,800 --> 00:09:29,800 Speaker 5: It's probably less than that now, and a lot of 148 00:09:29,800 --> 00:09:33,439 Speaker 5: people had already voted by the time those events happened. 149 00:09:33,880 --> 00:09:37,280 Speaker 5: But the Harris campaign is not a lot quietly anymore, 150 00:09:37,280 --> 00:09:39,360 Speaker 5: feeling very confident because of what they've seen in the 151 00:09:39,440 --> 00:09:39,920 Speaker 5: last few. 152 00:09:39,800 --> 00:09:41,360 Speaker 3: Days we had. 153 00:09:41,520 --> 00:09:43,600 Speaker 4: Yesterday, the piece of music came out as the Seltzer 154 00:09:43,920 --> 00:09:48,360 Speaker 4: poll coming out of Iowa that surprisingly showed Vice President 155 00:09:48,440 --> 00:09:53,040 Speaker 4: Kamala Harris three points ahead. What do you make of that? 156 00:09:53,480 --> 00:09:58,000 Speaker 5: Earthquake does not understate the impact that they had. And 157 00:09:58,200 --> 00:10:01,360 Speaker 5: Seltzer's record in Iowa was so good that I occasionally 158 00:10:01,640 --> 00:10:03,800 Speaker 5: I occasionally make jokes that she doesn't She's lived in 159 00:10:03,800 --> 00:10:05,840 Speaker 5: Iowa a whole life. She only does Iowa. She doesn't 160 00:10:05,840 --> 00:10:08,160 Speaker 5: pull the state. She just knows every Iowa voter and 161 00:10:08,200 --> 00:10:11,440 Speaker 5: asks them what they'll do. She I mean, it's not 162 00:10:11,480 --> 00:10:13,240 Speaker 5: that she's never been wrong. She missed a gubernatorial e 163 00:10:13,320 --> 00:10:15,720 Speaker 5: race a couple of years a few years ago, but 164 00:10:15,840 --> 00:10:18,520 Speaker 5: in general, her record is as close to perfect as 165 00:10:18,600 --> 00:10:21,080 Speaker 5: Upholster can get. For her to say not just that 166 00:10:21,160 --> 00:10:25,240 Speaker 5: it's close, but that Trump is three points down stunning, 167 00:10:25,840 --> 00:10:27,719 Speaker 5: I'll add to that. Okay, let's say she had a 168 00:10:27,720 --> 00:10:30,640 Speaker 5: statistical fluke. It can happen to anyone, even Seltzer, I 169 00:10:30,679 --> 00:10:33,560 Speaker 5: don't really think Harris is gonna win Iowa. The Trump 170 00:10:33,600 --> 00:10:38,720 Speaker 5: campaign's response was to leak internals saying that they that 171 00:10:38,760 --> 00:10:41,480 Speaker 5: they had numbers saying he was five points up. That's 172 00:10:41,520 --> 00:10:43,560 Speaker 5: really bad for Trump. If he's five points up, and 173 00:10:43,679 --> 00:10:45,400 Speaker 5: he should be ten to fifteen points up in Iowa. 174 00:10:45,559 --> 00:10:47,920 Speaker 5: If he's five points up in Iowa, that's really bad 175 00:10:47,960 --> 00:10:50,080 Speaker 5: news for him across the country. Now, the one thing 176 00:10:50,120 --> 00:10:53,199 Speaker 5: I'd say is it might be Iowa specific. Iowa's abortion 177 00:10:53,320 --> 00:10:57,720 Speaker 5: band went into what went active in July, and basically 178 00:10:57,800 --> 00:11:00,720 Speaker 5: Iowa local elections have been nothing but sat gration bombing 179 00:11:00,760 --> 00:11:05,320 Speaker 5: on abortion, and so that might mean that a swing 180 00:11:05,480 --> 00:11:08,840 Speaker 5: by white women that's what Seltz picked up based on Dobbs, 181 00:11:09,400 --> 00:11:11,520 Speaker 5: is more intense in Iowa than it is anywhere else 182 00:11:11,520 --> 00:11:12,040 Speaker 5: in the country. 183 00:11:12,920 --> 00:11:17,560 Speaker 4: Turnout, I'm told that it's particularly important this election, given 184 00:11:17,600 --> 00:11:21,960 Speaker 4: how close the election appears to be. Does one camp 185 00:11:22,040 --> 00:11:24,680 Speaker 4: one party have an advantage there in terms of turnout. 186 00:11:25,440 --> 00:11:28,720 Speaker 5: So everyone agrees that the Harris turnout machine is much better, 187 00:11:28,800 --> 00:11:30,960 Speaker 5: Like that's just that's not even that the Trump people 188 00:11:30,960 --> 00:11:33,040 Speaker 5: will tell you that it's just much more effective, partly 189 00:11:33,040 --> 00:11:35,520 Speaker 5: because they the Trump people outsource their entire turnout operation 190 00:11:35,559 --> 00:11:38,520 Speaker 5: of Charlie Kirk and Elon Musk, and you can't build 191 00:11:38,559 --> 00:11:40,400 Speaker 5: these things on the fly like you actually have to 192 00:11:40,400 --> 00:11:45,120 Speaker 5: spend years doing it. That being said, Trump had essentially 193 00:11:45,200 --> 00:11:48,640 Speaker 5: no turnout in operation at twenty sixteen, none, and he 194 00:11:48,760 --> 00:11:51,400 Speaker 5: got people who never who you know, a democratic turnout 195 00:11:51,440 --> 00:11:53,320 Speaker 5: machine would have just written off is not worth approaching. 196 00:11:53,880 --> 00:11:55,440 Speaker 5: He got them to show up and vote for him. 197 00:11:55,559 --> 00:11:58,760 Speaker 5: There's nothing that helps your turnout more than a clear, 198 00:11:58,840 --> 00:12:02,400 Speaker 5: consistent message by a care ors met a candidate. You know, 199 00:12:02,600 --> 00:12:05,199 Speaker 5: whether you like Donald Trump or not, that is a 200 00:12:05,320 --> 00:12:07,280 Speaker 5: pretty good description of his campaign. 201 00:12:08,520 --> 00:12:10,760 Speaker 4: What do you think I mean? Is Pennsylvania the state 202 00:12:10,800 --> 00:12:12,400 Speaker 4: we should be focusing on or are there some other 203 00:12:12,440 --> 00:12:13,800 Speaker 4: places we should be looking. 204 00:12:13,880 --> 00:12:18,160 Speaker 5: I would start with Pennsylvania. So let's say it's harder 205 00:12:18,200 --> 00:12:20,640 Speaker 5: to get early info from states than it is from 206 00:12:20,840 --> 00:12:24,600 Speaker 5: particular areas, So it varies from election to election. But 207 00:12:24,679 --> 00:12:27,200 Speaker 5: I'll tell you in twenty sixteen, I was looking at 208 00:12:27,240 --> 00:12:30,320 Speaker 5: some areas in Virginia, and I was I was in China, 209 00:12:30,360 --> 00:12:32,760 Speaker 5: of all things. I was doing an election commentary in Beijing. 210 00:12:32,920 --> 00:12:36,439 Speaker 5: Among the strangest experiences of my life. And so about 211 00:12:36,559 --> 00:12:39,360 Speaker 5: nine pm local time, which would have been nine and sorry, 212 00:12:39,440 --> 00:12:41,400 Speaker 5: nine am local time, which had been nine pm time here, 213 00:12:41,720 --> 00:12:43,720 Speaker 5: I got those results and turned to some people next 214 00:12:43,720 --> 00:12:47,280 Speaker 5: to me and said, I think one's gonna lose this time. 215 00:12:47,480 --> 00:12:51,160 Speaker 5: There's actually Pennsylvania guests also Delaware. They're oddly I mean, 216 00:12:51,200 --> 00:12:53,640 Speaker 5: obviously they're gonna win Delaware, but if it's closer than 217 00:12:53,679 --> 00:12:56,400 Speaker 5: you expect, that would be a pretty bad sign for Harris. 218 00:12:57,280 --> 00:13:01,440 Speaker 2: Picking presidents, I mean, mister Trump is unique, even as 219 00:13:01,440 --> 00:13:05,040 Speaker 2: supporters will agree, it's a unique process. What have we 220 00:13:05,160 --> 00:13:08,360 Speaker 2: learned your wonderful book picking presidents? What have we learned 221 00:13:08,760 --> 00:13:12,520 Speaker 2: about picking presidents? It prepares us for twenty twenty eight? 222 00:13:13,640 --> 00:13:16,319 Speaker 5: I think counterintuitively, the thing maybe we should learn is 223 00:13:16,400 --> 00:13:20,559 Speaker 5: that campaigns. Campaigns are just too long. I think Harris 224 00:13:20,559 --> 00:13:23,560 Speaker 5: got a real benefit from being I mean, maybe this 225 00:13:23,679 --> 00:13:26,520 Speaker 5: was too short for her, but the two year long 226 00:13:26,559 --> 00:13:28,920 Speaker 5: election cycle that we've been doing for presidential campaigns, it 227 00:13:29,000 --> 00:13:32,360 Speaker 5: drives everyone in saying it forces people to take positions 228 00:13:32,360 --> 00:13:34,280 Speaker 5: that end up being completely in defensive. 229 00:13:34,440 --> 00:13:36,880 Speaker 2: So to be clear, here, for Vice President Harris, she 230 00:13:36,960 --> 00:13:39,240 Speaker 2: had an advantage because of the delay. 231 00:13:39,800 --> 00:13:41,800 Speaker 5: I won't say I think she would rather have had 232 00:13:41,840 --> 00:13:43,839 Speaker 5: a normal cycle, And I have to give her credit 233 00:13:43,880 --> 00:13:45,520 Speaker 5: for being able to perform this balancing act in the 234 00:13:45,520 --> 00:13:47,559 Speaker 5: shortest kind of time. But if I were a normal candidate, 235 00:13:47,920 --> 00:13:50,040 Speaker 5: I would rather do six months than two years. 236 00:13:50,120 --> 00:13:54,360 Speaker 2: Charlie Cook led his before election essay with we grew 237 00:13:54,440 --> 00:13:59,120 Speaker 2: up with landslides. I was explaining at home what they 238 00:13:59,160 --> 00:14:03,440 Speaker 2: did to mcgovernor in seventy two. That's beyond the realm 239 00:14:03,520 --> 00:14:07,120 Speaker 2: of how we think. Now. Do you desire, professor, that 240 00:14:07,200 --> 00:14:11,480 Speaker 2: we get back to landslides, back to where we vote 241 00:14:11,520 --> 00:14:14,400 Speaker 2: for somebody with an image, or we just wedded to 242 00:14:14,480 --> 00:14:16,360 Speaker 2: this polarity forever. 243 00:14:16,760 --> 00:14:18,640 Speaker 5: So I don't think we are. We saw landslide in two 244 00:14:18,600 --> 00:14:21,360 Speaker 5: thousand and eight and twenty twelve was not that close. 245 00:14:23,200 --> 00:14:27,360 Speaker 5: This polarity is deeply operational, and I'll says, speaking as 246 00:14:27,400 --> 00:14:29,640 Speaker 5: a political scientist for a second, we don't really understand 247 00:14:29,640 --> 00:14:31,840 Speaker 5: why we don't have good theories as to what is 248 00:14:31,840 --> 00:14:33,920 Speaker 5: going on, as to why the elections. The elections are 249 00:14:33,960 --> 00:14:37,880 Speaker 5: so perfectly balanced right now. I think the American political 250 00:14:37,920 --> 00:14:40,800 Speaker 5: system basically does not work when it is in deadlock. 251 00:14:41,480 --> 00:14:42,560 Speaker 5: Other political systems do. 252 00:14:42,720 --> 00:14:45,880 Speaker 2: But to the laureate to mit. Is it, you know, 253 00:14:45,920 --> 00:14:48,080 Speaker 2: in the Power and Progress? Is it just a separation 254 00:14:48,200 --> 00:14:51,040 Speaker 2: of the nation year between the haves and they have nots? 255 00:14:51,520 --> 00:14:53,280 Speaker 2: Is that really all this comes down to. 256 00:14:53,720 --> 00:14:56,840 Speaker 5: I don't think so. I think that is a driving issue. 257 00:14:57,000 --> 00:15:01,080 Speaker 5: But although the Trump campaign sort of said images, it's 258 00:15:01,080 --> 00:15:03,360 Speaker 5: image of itself that it portrays is of the working 259 00:15:03,560 --> 00:15:07,800 Speaker 5: sort of the working class tribunal. Trump voters are significantly 260 00:15:07,840 --> 00:15:11,280 Speaker 5: wealthier than Harris voters. They were significantly wealthier than Biden 261 00:15:11,360 --> 00:15:13,520 Speaker 5: voters in twenty twenty. They will be significantly well Maharris 262 00:15:13,640 --> 00:15:16,240 Speaker 5: was twenty twenty four. And so you have a real 263 00:15:16,240 --> 00:15:20,240 Speaker 5: conflict between the image of the campaigns and their voter base. 264 00:15:20,360 --> 00:15:22,160 Speaker 5: And that is going to be resolved eventually, but it 265 00:15:22,240 --> 00:15:22,840 Speaker 5: might take a while. 266 00:15:23,040 --> 00:15:25,680 Speaker 2: Love can't wait to talk to you after this election. 267 00:15:26,520 --> 00:15:28,920 Speaker 2: Got a Macunda with this, of course, of Yale his 268 00:15:29,000 --> 00:15:32,360 Speaker 2: book Picking Presidents, How to Make the Most consequential Decision 269 00:15:32,920 --> 00:15:33,600 Speaker 2: in the World. 270 00:15:34,040 --> 00:15:38,320 Speaker 1: This is the Bloomberg Surveillance Podcast. Listen live each weekday 271 00:15:38,400 --> 00:15:41,600 Speaker 1: starting at seven am Eastern on applecar Play and Android 272 00:15:41,640 --> 00:15:44,480 Speaker 1: Auto with the Bloomberg Business app. You can also listen 273 00:15:44,600 --> 00:15:47,720 Speaker 1: live on Amazon Alexa from our flagship New York station. 274 00:15:48,080 --> 00:15:50,800 Speaker 1: Just say Alexa play Bloomberg eleven thirty. 275 00:15:50,960 --> 00:15:53,960 Speaker 2: Dan Tobin joins the City Group and courses London watch 276 00:15:54,840 --> 00:15:58,640 Speaker 2: for them, and he's of course with FX there a 277 00:15:58,720 --> 00:16:01,840 Speaker 2: G ten effects strategy. It's City Group. So if you 278 00:16:01,960 --> 00:16:08,080 Speaker 2: bracket Euro Trump Harris Euro right now is I'm looking 279 00:16:08,080 --> 00:16:10,160 Speaker 2: at damn. My eyes are failing me here one oh nine? 280 00:16:10,840 --> 00:16:14,560 Speaker 2: With Trump? Where's Euro? With a Harris? Where's Euro? Yeah? 281 00:16:14,600 --> 00:16:17,800 Speaker 6: Well, I mean very simply, if Trump wins Euro, dollar 282 00:16:17,920 --> 00:16:21,160 Speaker 6: goes down potentially all the way towards around one oh five. 283 00:16:21,240 --> 00:16:22,800 Speaker 6: That'd probably be a bit of a stretch, but it 284 00:16:22,800 --> 00:16:26,160 Speaker 6: could get down that far. If Harris wins, Euro higher 285 00:16:26,240 --> 00:16:28,600 Speaker 6: at least back to one ten, but there might be 286 00:16:28,640 --> 00:16:31,960 Speaker 6: some difficulty getting higher than that, simply because data in 287 00:16:32,000 --> 00:16:33,920 Speaker 6: the US has been outperforming the Euro. 288 00:16:34,240 --> 00:16:39,080 Speaker 2: So with Harris, the euro strength is it's asymmetric. Is 289 00:16:39,120 --> 00:16:42,520 Speaker 2: it about euro stronger? Is it sell the dollar with Harris? 290 00:16:42,680 --> 00:16:45,440 Speaker 6: No, this is absolutely about the dollar. And actually there's 291 00:16:45,640 --> 00:16:47,360 Speaker 6: dollar yen would be a trade we'd be looking. 292 00:16:47,200 --> 00:16:48,360 Speaker 2: At more because wrack at that. 293 00:16:48,440 --> 00:16:54,320 Speaker 6: Please, it's a proxy one, it's a proxy for rates, 294 00:16:54,400 --> 00:16:56,560 Speaker 6: and so rates should go down, You'll should go down 295 00:16:56,600 --> 00:16:59,240 Speaker 6: if we see a Harris win, and so dollar yen 296 00:16:59,280 --> 00:17:00,000 Speaker 6: should go down as well. 297 00:17:00,840 --> 00:17:04,119 Speaker 4: Since the beginning of time, when I think about trading currencies, 298 00:17:04,160 --> 00:17:07,600 Speaker 4: I think about City, Bank and City. Now you guys 299 00:17:07,600 --> 00:17:12,960 Speaker 4: are New York, London, Asia, you trade everything. How are 300 00:17:12,960 --> 00:17:15,400 Speaker 4: you guys staffing up for the next twelve to twenty 301 00:17:15,440 --> 00:17:18,480 Speaker 4: four hours globally currency desk at City. 302 00:17:18,920 --> 00:17:20,879 Speaker 6: Oh, it's it's gonna be busy, and it's gonna be 303 00:17:20,920 --> 00:17:23,360 Speaker 6: all hands on deck at least tonight until we have 304 00:17:24,119 --> 00:17:25,960 Speaker 6: you know, probably until midnight. We have to see how 305 00:17:26,000 --> 00:17:28,879 Speaker 6: the results are coming out, but certainly twenty four to 306 00:17:28,960 --> 00:17:31,440 Speaker 6: seven we will have staff and we will be there. 307 00:17:31,359 --> 00:17:35,119 Speaker 2: For what currency pair, What indicator of FX is what 308 00:17:35,280 --> 00:17:37,920 Speaker 2: Dan Tobin's gonna watch off the Bloomberg at City. 309 00:17:37,800 --> 00:17:40,120 Speaker 6: I'm gonna be watching dollar Yen and dollar max. Those 310 00:17:40,119 --> 00:17:41,639 Speaker 6: will be the two key ones to keep an eye on. 311 00:17:41,720 --> 00:17:43,760 Speaker 4: Talk to us about dollar Mexican hit pay, So what's 312 00:17:43,800 --> 00:17:46,760 Speaker 4: the relationship there, what's driving that trade? 313 00:17:46,760 --> 00:17:47,240 Speaker 2: These days? 314 00:17:47,480 --> 00:17:49,800 Speaker 6: Dollar max has a lot of domestic stories, but it's 315 00:17:49,840 --> 00:17:53,880 Speaker 6: also sensitive to the US dynamic if Trump wins, both 316 00:17:53,960 --> 00:17:57,240 Speaker 6: because the USMCA will come under review and so there's 317 00:17:57,320 --> 00:18:00,560 Speaker 6: some potential uncertainty around there, and also because there's been 318 00:18:00,560 --> 00:18:03,200 Speaker 6: a lot of border disputes, so Mexus comes into focus 319 00:18:03,480 --> 00:18:03,919 Speaker 6: and remains. 320 00:18:04,440 --> 00:18:07,520 Speaker 2: So Max's twenty point one three. If Trump is going 321 00:18:07,560 --> 00:18:10,679 Speaker 2: to win or appear to win, it weakens to twenty 322 00:18:10,720 --> 00:18:12,960 Speaker 2: one twenty two in that area. 323 00:18:13,080 --> 00:18:15,120 Speaker 6: It's hard to say overnight, but certainly potentially. 324 00:18:15,200 --> 00:18:19,040 Speaker 2: Yeah, I don't, you know, it's completely unfair, but the directions. 325 00:18:18,680 --> 00:18:19,640 Speaker 6: Absolutely that story. 326 00:18:19,720 --> 00:18:21,920 Speaker 4: When you talk to your clients, do you feel like 327 00:18:21,960 --> 00:18:26,240 Speaker 4: they're hedged today? Are they making bets today? Are they 328 00:18:26,320 --> 00:18:29,640 Speaker 4: just saying I'm on the sidelines today because there will 329 00:18:29,680 --> 00:18:30,800 Speaker 4: be movements in your market? 330 00:18:30,880 --> 00:18:31,080 Speaker 2: Yeah? 331 00:18:31,119 --> 00:18:34,639 Speaker 6: Absolutely. For the most part, the big accounts have really 332 00:18:34,680 --> 00:18:37,320 Speaker 6: reduced positioning and are trying to go in as lightly 333 00:18:37,359 --> 00:18:41,160 Speaker 6: positioned as possible. The more active clients they're long dollar, 334 00:18:41,200 --> 00:18:43,080 Speaker 6: they've reduced some of that. They were a lot more 335 00:18:43,119 --> 00:18:45,480 Speaker 6: long dollar last week when Trump odds were a bit higher. 336 00:18:46,200 --> 00:18:47,800 Speaker 6: Still leaning towards long dollar though. 337 00:18:48,200 --> 00:18:51,320 Speaker 4: So all right, let's go seventy two hours, three, four 338 00:18:51,359 --> 00:18:52,360 Speaker 4: or five days from now? 339 00:18:52,720 --> 00:18:53,840 Speaker 2: What long term? 340 00:18:53,880 --> 00:18:57,679 Speaker 4: Long term? Let's get back to more fundamentals. What's your 341 00:18:57,800 --> 00:19:00,560 Speaker 4: view here at the currency markets? Where do you see 342 00:19:00,640 --> 00:19:01,200 Speaker 4: value here? 343 00:19:02,040 --> 00:19:02,320 Speaker 3: Yeah? 344 00:19:02,359 --> 00:19:05,680 Speaker 6: Probably outside of the dollar we'd be looking at things 345 00:19:05,720 --> 00:19:08,480 Speaker 6: like the Australian dollar. Actually there's a lot of value 346 00:19:08,480 --> 00:19:11,320 Speaker 6: there just because the domestic story is strong, and there's 347 00:19:11,320 --> 00:19:15,040 Speaker 6: potential for some hedge changes next year. At the end 348 00:19:15,080 --> 00:19:16,760 Speaker 6: of the day, though, the data in the US is 349 00:19:16,760 --> 00:19:19,199 Speaker 6: still holding up, and so it's hard to see a 350 00:19:19,280 --> 00:19:22,000 Speaker 6: real big sell off coming for the dollar. Even if 351 00:19:22,000 --> 00:19:24,240 Speaker 6: Harris wins and the dollar selves off, it probably will 352 00:19:24,240 --> 00:19:26,240 Speaker 6: be momentary and the dollar probably rally. 353 00:19:26,240 --> 00:19:28,239 Speaker 2: Do you have a I mean, G ten, it's not 354 00:19:28,560 --> 00:19:32,639 Speaker 2: but China, How do you affect a China trade given 355 00:19:32,680 --> 00:19:37,320 Speaker 2: the Congress coming out, presume fiscal support, more help, et cetera. 356 00:19:37,840 --> 00:19:40,159 Speaker 2: How does city group affect a China belief? 357 00:19:40,960 --> 00:19:43,159 Speaker 6: Yeah, I mean, the key question is going to be 358 00:19:43,200 --> 00:19:45,080 Speaker 6: what kind of tariffs do we get if we do, 359 00:19:45,160 --> 00:19:47,480 Speaker 6: in fact get a Trump presidency, and to offset that, 360 00:19:47,560 --> 00:19:49,720 Speaker 6: what kind of stimulus where we get from the Chinese side? 361 00:19:49,720 --> 00:19:52,680 Speaker 6: And we do have the Standing Committee meeting on November eight, 362 00:19:53,040 --> 00:19:55,320 Speaker 6: so there it will potentially be a lot of volatility 363 00:19:55,320 --> 00:19:57,760 Speaker 6: around the currency. But very simply, if Trump wins, we 364 00:19:57,800 --> 00:20:01,159 Speaker 6: expect dollars CNH to move higher. Harris wins, we can 365 00:20:01,200 --> 00:20:03,200 Speaker 6: actually see dollars CNH more stable. 366 00:20:03,680 --> 00:20:07,639 Speaker 4: The pound sterling, what's the call there? How do you 367 00:20:07,680 --> 00:20:09,560 Speaker 4: how do you feel about sterling right here? 368 00:20:09,840 --> 00:20:10,919 Speaker 2: Structurally we like it. 369 00:20:11,040 --> 00:20:13,800 Speaker 6: We think there's opportunity for investors which have been very 370 00:20:13,840 --> 00:20:17,320 Speaker 6: underweight the UK since Breadxit, to start moving assets back 371 00:20:17,359 --> 00:20:21,280 Speaker 6: into the UK. Guilt yields look somewhat attractive here. So 372 00:20:21,320 --> 00:20:24,520 Speaker 6: we see potential for a stronger sterling, especially against the Euro, 373 00:20:24,600 --> 00:20:26,760 Speaker 6: into next year. But in the short term it's not 374 00:20:26,800 --> 00:20:29,880 Speaker 6: trading to its domestic fundamentals. It's trading too concerns around 375 00:20:29,920 --> 00:20:31,400 Speaker 6: the budget, around and across the US. 376 00:20:31,600 --> 00:20:33,800 Speaker 2: I'm trying of question you do technicals, which we do 377 00:20:33,840 --> 00:20:37,119 Speaker 2: a lot here instrumants, technicals and radio really work. And 378 00:20:38,080 --> 00:20:42,080 Speaker 2: the answer here is when someone says the vector and 379 00:20:42,119 --> 00:20:45,920 Speaker 2: the dollar is strong dollar, is there an established trend 380 00:20:46,680 --> 00:20:49,480 Speaker 2: I call it soup? Or is it technically just soup? 381 00:20:49,560 --> 00:20:50,920 Speaker 2: Where the dollar is right now? 382 00:20:50,960 --> 00:20:53,200 Speaker 6: If we pull out far enough, there is a very 383 00:20:53,240 --> 00:20:56,480 Speaker 6: clear trend since the Great Financial Crisis for a stronger dollar, 384 00:20:56,520 --> 00:20:59,960 Speaker 6: and in fact, the US has been the outperforming economy 385 00:21:00,280 --> 00:21:01,560 Speaker 6: in the global development. 386 00:21:01,560 --> 00:21:03,520 Speaker 2: So does it gets you on YenS through one sixty? 387 00:21:03,680 --> 00:21:06,280 Speaker 2: I mean Gartman's frame in it for gold, But that's 388 00:21:06,320 --> 00:21:09,240 Speaker 2: Gartman making gold chat. Can you, as a major bank 389 00:21:09,440 --> 00:21:13,440 Speaker 2: frame out a fan distribution it gets a yen back 390 00:21:13,480 --> 00:21:15,040 Speaker 2: out over one sixty. 391 00:21:15,040 --> 00:21:19,080 Speaker 6: That would require a much higher US tenure yield. And 392 00:21:19,160 --> 00:21:21,280 Speaker 6: given that the FED is already in a cutting cycle, 393 00:21:21,320 --> 00:21:22,919 Speaker 6: and then in general we're seeing a bit of a 394 00:21:22,920 --> 00:21:25,399 Speaker 6: slowan on in the US, it's hard to see that 395 00:21:25,480 --> 00:21:28,360 Speaker 6: absence some kind of fiscal shock. Now that's not impossible, 396 00:21:28,400 --> 00:21:31,480 Speaker 6: given you know, we have a potential red wave coming, 397 00:21:31,560 --> 00:21:33,639 Speaker 6: but it's hard for us to see that we actually 398 00:21:33,640 --> 00:21:35,359 Speaker 6: think the yen can strengthen into next year. 399 00:21:35,600 --> 00:21:38,240 Speaker 2: Paul said, you're everywhere? Where are you based for City Group? 400 00:21:38,280 --> 00:21:39,520 Speaker 2: Are you in like Dubai or. 401 00:21:40,200 --> 00:21:42,200 Speaker 6: I'm in New York, but I've I've worked all over 402 00:21:42,280 --> 00:21:44,240 Speaker 6: for City They're everywhere. 403 00:21:44,600 --> 00:21:46,800 Speaker 4: I'm actually if you want to go trade some obscure 404 00:21:46,880 --> 00:21:49,520 Speaker 4: currency already. 405 00:21:49,280 --> 00:21:52,359 Speaker 2: Dan Tobin's Razumi and it's like it's like the romance 406 00:21:52,400 --> 00:21:55,919 Speaker 2: of you know, FX in Big Bank. I mean, you know, 407 00:21:56,119 --> 00:21:58,840 Speaker 2: he came out of Villanova and he's sipping tea in Mayfair. 408 00:21:58,880 --> 00:21:59,520 Speaker 2: What's that about? 409 00:21:59,600 --> 00:22:02,280 Speaker 6: I know City is the FX bank and London is 410 00:22:02,320 --> 00:22:02,600 Speaker 6: a place. 411 00:22:02,640 --> 00:22:04,719 Speaker 2: What was your first day like in City Group? It 412 00:22:04,760 --> 00:22:06,280 Speaker 2: was it like the TV show industry. 413 00:22:06,880 --> 00:22:07,879 Speaker 6: Oh no, no, no, it was. 414 00:22:09,440 --> 00:22:10,119 Speaker 2: Actually great. 415 00:22:10,160 --> 00:22:13,240 Speaker 6: I've loved working there. I've been there for over a decade. 416 00:22:13,240 --> 00:22:15,000 Speaker 6: I did leave and I came back because I loved 417 00:22:15,000 --> 00:22:15,560 Speaker 6: it so much. 418 00:22:15,800 --> 00:22:18,160 Speaker 2: Great, Dan Tobe, don't be a stranger. Thank you so much. 419 00:22:18,240 --> 00:22:20,959 Speaker 2: Thanks very much, City Group, you said g ten FX 420 00:22:21,000 --> 00:22:21,640 Speaker 2: at City Group. 421 00:22:26,800 --> 00:22:31,080 Speaker 1: This is the Bloomberg Surveillance Podcast. Listen live each weekday 422 00:22:31,160 --> 00:22:34,360 Speaker 1: starting at seven am Eastern on applecar Play and Android 423 00:22:34,400 --> 00:22:37,320 Speaker 1: Auto with the Bloomberg Business app. You can also watch 424 00:22:37,400 --> 00:22:40,679 Speaker 1: us live every weekday on YouTube and always on the 425 00:22:40,680 --> 00:22:41,680 Speaker 1: Bloomberg terminal. 426 00:22:42,040 --> 00:22:44,320 Speaker 2: Joining us right now. The last time he's on, he 427 00:22:44,440 --> 00:22:48,200 Speaker 2: was a hugely knowledgeable pause blown away. Beneticae Cammel joins us, 428 00:22:48,280 --> 00:22:51,159 Speaker 2: why don't you bring him in? You nailed it. I 429 00:22:51,200 --> 00:22:53,280 Speaker 2: mean you told me the strike's not going to get 430 00:22:53,280 --> 00:22:55,679 Speaker 2: settled last time, and this time was different. 431 00:22:55,760 --> 00:22:57,880 Speaker 4: Yeah, it's they Finally we got the rank and file 432 00:22:57,920 --> 00:23:00,480 Speaker 4: Tom over at Boeing, the machinist of in a Pacific 433 00:23:00,520 --> 00:23:02,359 Speaker 4: Northwest agreeing to a contract with Boeing. 434 00:23:02,400 --> 00:23:03,520 Speaker 1: A piece of good news. 435 00:23:03,280 --> 00:23:05,800 Speaker 4: For them and for the company and for the stock. 436 00:23:05,920 --> 00:23:08,359 Speaker 4: Stocks up about one point three percent pre market trading. 437 00:23:08,359 --> 00:23:12,360 Speaker 4: Benedic Cammel Joins is Global Aviation editorial leader for Bloomberg News. 438 00:23:12,359 --> 00:23:16,720 Speaker 4: He's based in Berlin, Germany, Benedict. What's different for this 439 00:23:16,800 --> 00:23:20,320 Speaker 4: contract versus the last contract? Is it simply dollars and cents. 440 00:23:21,720 --> 00:23:23,280 Speaker 7: There's a bit of that. I think your numbers are 441 00:23:23,280 --> 00:23:25,680 Speaker 7: slightly better. You know, we had now a thirty eight 442 00:23:25,720 --> 00:23:29,320 Speaker 7: percent wage increase last timers thirty five, so up a smidge. 443 00:23:29,400 --> 00:23:31,720 Speaker 7: But I think the bigger difference is that there was 444 00:23:31,720 --> 00:23:34,119 Speaker 7: a general weariness, and you could see it in the 445 00:23:34,160 --> 00:23:37,680 Speaker 7: faces of the workers of the union leadership. I think 446 00:23:37,680 --> 00:23:41,000 Speaker 7: everyone was ready to get this done with and they 447 00:23:41,040 --> 00:23:43,359 Speaker 7: probably felt this is as good as it's going to get. 448 00:23:44,480 --> 00:23:47,840 Speaker 7: Any any more holdouts and any more negative votes, we 449 00:23:47,960 --> 00:23:51,359 Speaker 7: might actually start hurting ourselves more than we start benefiting 450 00:23:51,359 --> 00:23:54,439 Speaker 7: from this. So there was this sense this is a 451 00:23:54,440 --> 00:23:57,720 Speaker 7: pretty good deal. It's a thirty eight percent wage increase 452 00:23:57,800 --> 00:24:00,800 Speaker 7: over a couple of years. There's a big bonuses, a 453 00:24:00,840 --> 00:24:04,159 Speaker 7: couple of other sweetness thrown in, and and you know, 454 00:24:04,240 --> 00:24:09,639 Speaker 7: we're moving towards Thanksgiving. People's savings are depleted. People, you know, 455 00:24:09,720 --> 00:24:12,640 Speaker 7: started to get cold over there. The Joys are standing 456 00:24:12,680 --> 00:24:15,400 Speaker 7: by the roadside with a sign in your hand probably 457 00:24:15,760 --> 00:24:18,639 Speaker 7: rapidly diminishing. So there was that sense, let's get it 458 00:24:18,680 --> 00:24:20,920 Speaker 7: done with. This is good, and that's where we got 459 00:24:21,080 --> 00:24:25,639 Speaker 7: fifty nine percent approval. Okay, you know, mathematically all they needed, 460 00:24:25,720 --> 00:24:28,400 Speaker 7: but not great if you want to repair relations. 461 00:24:28,760 --> 00:24:31,600 Speaker 4: So what's the company saying about their ability to kind 462 00:24:31,640 --> 00:24:35,800 Speaker 4: of restart the assembly line and get those planes coming 463 00:24:35,840 --> 00:24:37,720 Speaker 4: out of the assembly line, getting them to customers and 464 00:24:38,280 --> 00:24:40,200 Speaker 4: bring them cash flow into the company. What's the company 465 00:24:40,240 --> 00:24:40,960 Speaker 4: saying about timing. 466 00:24:42,119 --> 00:24:45,480 Speaker 7: Well, there's no absolute perfect sense of timing here, but 467 00:24:45,480 --> 00:24:47,040 Speaker 7: they have said, is it going to take a while? 468 00:24:47,800 --> 00:24:49,920 Speaker 7: Kelly or Bog the CEO, said a couple of weeks ago. 469 00:24:50,040 --> 00:24:53,119 Speaker 7: It's much easier to turn things off than it is 470 00:24:53,160 --> 00:24:55,439 Speaker 7: to turn them back on again. You know, as we 471 00:24:55,480 --> 00:24:59,600 Speaker 7: all know, fixing something's harder than breaking it. So it 472 00:24:59,680 --> 00:25:02,640 Speaker 7: will take months. You know, it'll take into next year 473 00:25:02,760 --> 00:25:05,200 Speaker 7: to give you a sense. They have said this year 474 00:25:05,359 --> 00:25:08,360 Speaker 7: will be a cash negative year, they'll have cash outflow, 475 00:25:08,480 --> 00:25:10,520 Speaker 7: and the next year, the first half will also be 476 00:25:10,600 --> 00:25:13,040 Speaker 7: cash negative. And that was to many people are surprise. 477 00:25:13,119 --> 00:25:16,359 Speaker 7: People thought that come early next year things would be 478 00:25:16,359 --> 00:25:19,120 Speaker 7: back in repair mode and sort of the company would 479 00:25:19,119 --> 00:25:21,720 Speaker 7: be would be on a road to recovery. But clearly 480 00:25:21,760 --> 00:25:24,120 Speaker 7: we're looking into this the latter part of next year 481 00:25:24,320 --> 00:25:27,720 Speaker 7: when that'll happen. So this year they will have burnt 482 00:25:27,800 --> 00:25:30,560 Speaker 7: about fourteen billion dollars of cash. You know, that gives 483 00:25:30,600 --> 00:25:32,760 Speaker 7: you a sense of just how high the stakes were. 484 00:25:32,800 --> 00:25:35,080 Speaker 7: And even the company the size of Boeing can't do 485 00:25:35,160 --> 00:25:37,080 Speaker 7: this forever, so the stakes are really high for both 486 00:25:37,119 --> 00:25:38,640 Speaker 7: sides to get this deal over. 487 00:25:38,680 --> 00:25:40,959 Speaker 2: The line man in the guard advantage with you is 488 00:25:41,119 --> 00:25:44,200 Speaker 2: you're in Berlin's so you get the to loose France 489 00:25:44,480 --> 00:25:49,480 Speaker 2: Airbus axes his. Airbus had any advantage from the strike. 490 00:25:50,960 --> 00:25:53,800 Speaker 7: Only in so much that people aren't looking at their 491 00:25:53,840 --> 00:25:56,119 Speaker 7: problems as much as they are at Boeing's. And you know, 492 00:25:56,520 --> 00:26:00,000 Speaker 7: Airbus is not without its own faults. Their production is 493 00:26:00,080 --> 00:26:02,520 Speaker 7: not where it should be. You know, it's not as 494 00:26:02,520 --> 00:26:05,600 Speaker 7: bad as Boeing's. They are actually producing planes, whereas Boeing 495 00:26:05,680 --> 00:26:08,200 Speaker 7: right now as close to zero. But they have huge 496 00:26:08,280 --> 00:26:11,840 Speaker 7: supply chain issues. They have had to cut back their 497 00:26:11,920 --> 00:26:15,800 Speaker 7: output targets for the year. But people are obviously far 498 00:26:15,840 --> 00:26:18,199 Speaker 7: more fixated on what's going on at Boeing than they 499 00:26:18,200 --> 00:26:21,639 Speaker 7: are at Airbus. But it's also it's a complicated market 500 00:26:21,680 --> 00:26:24,800 Speaker 7: where you can't simply switch from one supply to the other. 501 00:26:24,880 --> 00:26:28,800 Speaker 7: So even if you were a Ryanair, which is a 502 00:26:28,840 --> 00:26:31,480 Speaker 7: Boeing custom, and we had the Ryan CEO in the 503 00:26:32,000 --> 00:26:35,840 Speaker 7: studio yesterday and he was saying, look, I'm getting I'm 504 00:26:35,840 --> 00:26:37,920 Speaker 7: not getting the planes I need. I need them for 505 00:26:38,119 --> 00:26:40,600 Speaker 7: the peak summer period and they're not coming in. You 506 00:26:40,680 --> 00:26:42,600 Speaker 7: can't just pick up the phone to ge and free 507 00:26:42,760 --> 00:26:44,480 Speaker 7: the CEO of Rabbus and say hey, can you sell 508 00:26:44,520 --> 00:26:47,560 Speaker 7: me a couple of planes. So everyone is kind of 509 00:26:47,640 --> 00:26:51,080 Speaker 7: locked in, you know, the situation they're in, and everyone 510 00:26:51,160 --> 00:26:54,040 Speaker 7: is really hoping for this to resolve itself. And this strike, 511 00:26:54,119 --> 00:26:55,960 Speaker 7: the end of the strike, is one big step towards that. 512 00:26:56,240 --> 00:27:01,080 Speaker 2: Benedict, are you back any countless elections back to sixty 513 00:27:01,119 --> 00:27:04,080 Speaker 2: eight and seventy two in the Vietnam War? Is the 514 00:27:04,160 --> 00:27:09,000 Speaker 2: defense component of aviation, whether it's Lackey Martin or McDonald, Douglas, 515 00:27:09,040 --> 00:27:13,080 Speaker 2: et cetera, et cetera. And the answer, Benedict is it's 516 00:27:13,119 --> 00:27:18,800 Speaker 2: a big distraction. Is Boeing distracted or hindered because of 517 00:27:18,840 --> 00:27:23,679 Speaker 2: their defense institutional place in America? 518 00:27:23,960 --> 00:27:26,280 Speaker 7: Well, I mean defense is still a big component of 519 00:27:26,320 --> 00:27:28,440 Speaker 7: Boeing and it's all also part of the reason why 520 00:27:28,560 --> 00:27:30,359 Speaker 7: you know, a lot of people have said, is this 521 00:27:30,400 --> 00:27:32,320 Speaker 7: a company too big to fail? And yes it is 522 00:27:32,400 --> 00:27:35,560 Speaker 7: because they have that big foot in the door on 523 00:27:35,600 --> 00:27:38,280 Speaker 7: all things defense. And it's if you again, if you 524 00:27:38,320 --> 00:27:40,760 Speaker 7: compare it to Abbus, it's a much more sizable part 525 00:27:40,760 --> 00:27:44,640 Speaker 7: of their operation and a more important part. So whatever 526 00:27:44,680 --> 00:27:48,480 Speaker 7: Boeing looks like in three, five, ten years, the defense 527 00:27:48,520 --> 00:27:50,280 Speaker 7: component will still be there and it will be an 528 00:27:50,320 --> 00:27:52,960 Speaker 7: important part of what they do. It's a different question 529 00:27:53,000 --> 00:27:56,200 Speaker 7: when you start thinking about space, for instance. You know, yes, 530 00:27:56,240 --> 00:27:59,000 Speaker 7: they have this long history of you know, helping put 531 00:27:59,040 --> 00:28:00,800 Speaker 7: a man on the moon and all that, but the 532 00:28:01,080 --> 00:28:05,080 Speaker 7: space business is really where they're bleeding and where they're hurting. 533 00:28:05,200 --> 00:28:07,919 Speaker 7: So if you look at what they have to do, 534 00:28:08,040 --> 00:28:10,560 Speaker 7: and Kelly Orkberg, the CEO, has been quite open about this. 535 00:28:10,640 --> 00:28:13,000 Speaker 7: He says, we can't be everything to everyone. We have 536 00:28:13,080 --> 00:28:16,240 Speaker 7: to really think hard about what we're good at, what 537 00:28:16,320 --> 00:28:18,800 Speaker 7: where we make our money, and where we might have 538 00:28:18,880 --> 00:28:22,080 Speaker 7: to make some painful cuts. And if I had to guess, 539 00:28:22,320 --> 00:28:24,000 Speaker 7: it's probably going to be in the in the space 540 00:28:24,080 --> 00:28:25,800 Speaker 7: area more than in the defense market. 541 00:28:26,240 --> 00:28:29,600 Speaker 4: Bened what are the Boeing's customers saying are they still 542 00:28:29,640 --> 00:28:32,200 Speaker 4: standing by the company. Again, it's it's just a diopoly 543 00:28:32,240 --> 00:28:34,240 Speaker 4: out there. I guess they don't have much of a 544 00:28:34,400 --> 00:28:36,960 Speaker 4: choice there for your Southwest airlines and some other airlines 545 00:28:37,000 --> 00:28:39,360 Speaker 4: that depend upon Boeing. But what are the customers been saying? 546 00:28:40,560 --> 00:28:42,600 Speaker 7: They are and they're standing with them, and they're saying, 547 00:28:42,640 --> 00:28:45,880 Speaker 7: we want Bowing to succeed. And oddly, you'd think Abbus 548 00:28:45,880 --> 00:28:47,760 Speaker 7: is actually saying the same thing. They're saying, we take 549 00:28:47,880 --> 00:28:50,600 Speaker 7: no joy. I mean maybe secretly they might take a 550 00:28:50,640 --> 00:28:53,000 Speaker 7: little bit, but openly they will say we take no 551 00:28:53,120 --> 00:28:57,200 Speaker 7: joy in Boeing's misfortunes. Here is because we are sort 552 00:28:57,240 --> 00:28:59,600 Speaker 7: of tied at the hip with these with these guys 553 00:28:59,600 --> 00:29:02,240 Speaker 7: and them to succeed, we need a healthy market out there. 554 00:29:02,440 --> 00:29:05,880 Speaker 7: And as I said, if you're United, if you're an American, 555 00:29:06,400 --> 00:29:08,920 Speaker 7: if you're a Southwest, you can't just sort of switch 556 00:29:08,960 --> 00:29:12,000 Speaker 7: back and forth. You have these longtime contracts. You have 557 00:29:12,800 --> 00:29:15,600 Speaker 7: your crew training, you have your maintenance. All those things 558 00:29:15,640 --> 00:29:18,000 Speaker 7: are tied into these decades long contracts that you have 559 00:29:18,080 --> 00:29:21,840 Speaker 7: with these suppliers, and therefore they need bonies to succeed. 560 00:29:22,120 --> 00:29:23,800 Speaker 7: And as you say, there isn't really much of a 561 00:29:23,880 --> 00:29:26,520 Speaker 7: choice out there. The Chinese there are making some noises. 562 00:29:26,680 --> 00:29:29,480 Speaker 7: There was a Comac nine to one nine, but that 563 00:29:29,560 --> 00:29:32,240 Speaker 7: plane is not certified in the Western hemisphere, so it'll 564 00:29:32,280 --> 00:29:34,600 Speaker 7: be years. You know, who knows whether we on this 565 00:29:34,680 --> 00:29:38,320 Speaker 7: call we'll ever see that plane flying in our time zone, 566 00:29:38,880 --> 00:29:42,200 Speaker 7: but it'll come at some point, but that's far out. 567 00:29:42,560 --> 00:29:45,640 Speaker 2: Be absolutely spectacular. Thank you so much, Ben, Ben came 568 00:29:45,720 --> 00:29:48,600 Speaker 2: a worldwide driving our airline coverage. 569 00:29:48,880 --> 00:29:53,360 Speaker 1: This is the Bloomberg Surveillance podcast, available on Apple, Spotify, 570 00:29:53,520 --> 00:29:57,160 Speaker 1: and anywhere else you get your podcasts. Listen live each 571 00:29:57,200 --> 00:30:00,680 Speaker 1: weekday seven to ten am Eastern on Bloomberg dot com, 572 00:30:00,720 --> 00:30:04,320 Speaker 1: the iHeartRadio app, tune In, and the Bloomberg Business app. 573 00:30:04,600 --> 00:30:07,680 Speaker 1: You can also watch us live every weekday on YouTube 574 00:30:07,960 --> 00:30:09,760 Speaker 1: and always on the Bloomberg terminal