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Speaker 1: Bloomberg Audio Studios, podcasts, radio news.

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Speaker 2: You're listening to the Bloomberg Balance of Power podcast Kettys

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Speaker 2: live weekdays at noon and five pm Eastern on Apple

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Speaker 2: Cockley and Android Auto with the Bloomberg Business App. Listen

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Speaker 2: on demand wherever you get your podcasts, or watch us

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Speaker 2: live on YouTube.

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Speaker 3: Just after one pm Eastern time. And of course that

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Speaker 3: means it is about eight hours from now that we

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Speaker 3: expect to hear from President Trump speaking to the nation

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Speaker 3: from the White House at nine pm Eastern on the

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Speaker 3: war in Iran. A US official White House official telling

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Speaker 3: Bloomberg that it is going to be an operational update

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Speaker 3: on that war and that he will reiterate the timeline

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Speaker 3: heat outlined in the Oval Office when speaking with reporters yesterday,

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Speaker 3: that this will continue for two to three more weeks.

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Speaker 4: I had one goal, they will have no nuclear weapon,

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Speaker 4: and that goal has been attained.

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Speaker 5: They will not have nuclear weapons.

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Speaker 4: But we're finishing the job up and I think within

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Speaker 4: maybe two weeks, maybe a couple of days longer to

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Speaker 4: do the job, but we want to knock out every

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Speaker 4: single thing they have.

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Speaker 6: Now.

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Speaker 4: It's possible that we'll make a deal before that.

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Speaker 7: And maybe he will be speaking about a deal this evening.

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Speaker 8: There's so much we don't know about this address that

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Speaker 8: we will bring you live, of course here on Bloomberg

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Speaker 8: TV and radio. Again, it's at nine pm Eastern, so

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Speaker 8: the President will be getting in living rooms across the

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Speaker 8: country in a fairly rare prime time address. Will he

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Speaker 8: talk about troops? Will he talk about withdrawal? Is the

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Speaker 8: market optimism justified? Just some of the questions that we

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Speaker 8: have for the former vice president. I'm glad to say

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Speaker 8: Mike Pence is with us as promised, former Vice President

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Speaker 8: of the United States, the founder of advancing American Freedom.

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Speaker 7: Mister Vice President, welcome back.

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Speaker 5: It's great to say thank you.

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Speaker 8: What's your anticipation, your expectation for what the President might

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Speaker 8: say this evening?

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Speaker 7: And are you worried that.

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Speaker 8: The US could leave the region with the strait of

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Speaker 8: horm moves still closed?

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Speaker 9: Let me say I think every American should be proud

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Speaker 9: of the extraordinary work our men and women in uniform

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Speaker 9: have done over the last month. I mean taking the

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Speaker 9: fight directly to the leading state sponsor of terrorism in

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Speaker 9: the world. Iran has been a source of violence in Mayhem,

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Speaker 9: has claimed American lives of our allies and sown it's

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Speaker 9: malign influence across the region for forty seven years. So

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Speaker 9: I'm proud of our troops. I'm also proud that President

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Speaker 9: Trump pulled the trigger and made the decision to move

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Speaker 9: against Iran. Simply cannot allow Rand to obtain a nuclear weapon,

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Speaker 9: but to be able to hit the regime and simply

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Speaker 9: say that the time of you sowing terror across the

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Speaker 9: region are over. I think was action whose time has come.

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Speaker 9: But I will tell you I'm pleased the President's taking

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Speaker 9: his message directly to the American people in primetime tonight.

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Speaker 9: Not that the has been shy about explaining their rationale

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Speaker 9: for the war, but I think sitting behind the desk

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Speaker 9: in the Oval Office, as I was present for the

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Speaker 9: President to do a number of times during our years together,

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Speaker 9: I think sends a message to the American people about

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Speaker 9: our resolve, our support for our troops. I expect he'll

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Speaker 9: speak favorably about this mission. He'll update the American people

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Speaker 9: on our progress. But I also expect there will be

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Speaker 9: a call out to our allies around the world about

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Speaker 9: the need to come alongside America and make sure that

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Speaker 9: we finish this job and don't just open the Strait

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Speaker 9: of Hormuz, but that we make clear that the free

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Speaker 9: world will no longer tolerate the violence and terror that

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Speaker 9: has flowed from Tehran for forty seven years.

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Speaker 3: Well, I'm not call out to our allies, mister Vice President,

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Speaker 3: making the ask now versus giving them warning and making

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Speaker 3: the ask were these operations began. Why would they answer

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Speaker 3: the call at this time?

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Speaker 9: Well, because there are allies, o Kayley, And I'm particularly

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Speaker 9: disappointed in the United Kingdom. I mean, really since World

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Speaker 9: War Two, we've had what we what we call a

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Speaker 9: special relationship with the United Kingdom, which as I saw

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Speaker 9: first hand during my years in Congress and then when

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Speaker 9: I was Vice President, that when we go, the UK goes.

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Speaker 9: But not this time, and I think Keir Starmer has

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Speaker 9: has has fumbled in ways that are not reflective of

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Speaker 9: the deep and abiding ties between the American people and

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Speaker 9: the people of the UK. That being said, you know,

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Speaker 9: there have been other allies that have stood with us.

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Speaker 9: The German Chancellor has spoken boldly about America and Israel

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Speaker 9: taking the fight which was also their fight to Tehran.

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Speaker 9: But to see allies like Spain and even Italy a

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Speaker 9: restricting access of US air power to their airspace or

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Speaker 9: their bases. It's just unacceptable. I expect, knowing him as

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Speaker 9: well as I do, I expect you'll hear the presidents

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Speaker 9: speak out about that tonight. But look, at the end

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Speaker 9: of the day, this was not a moment where America

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Speaker 9: started a war a month ago. This was about a

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Speaker 9: president and American military and courageous Israeli forces being willing

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Speaker 9: to try and end a war that's been being waged

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Speaker 9: against America Israel in the West for all those decades.

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Speaker 8: Beyond reconsideration were the two words that jumped off the

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Speaker 8: page in the Daily Telegraph of London, the President suggesting that,

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Speaker 8: in fact, he would not only consider pulling out of NATO,

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Speaker 8: but is beyond the point of consideration. Are we going

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Speaker 8: to hear about a withdrawal from this alliance tonight?

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Speaker 9: Well, I don't expect so. And of course that had

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Speaker 9: taken act of Congress. That's right to step out of

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Speaker 9: the true to stop this president before. Look when during

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Speaker 9: our years the President spoke boldly about the fact that

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Speaker 9: most of our NATO allies were not living up to

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Speaker 9: their own commitment to spend three percent of their GDP

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Speaker 9: on our common defense. I was proud of the fact

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Speaker 9: that before we left office together, the overwhelming majority of

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Speaker 9: our NATO allies had invested some one hundred and twenty

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Speaker 9: billion dollars in our common defense. In fact, NATO's ability

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Speaker 9: to support Ukraine against that unprovoked invasion by Russia four

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Speaker 9: years ago is largely owing to the build up that

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Speaker 9: we facilitated. So I expect there'll be some tough talk

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Speaker 9: tonight by the President to our allies. The NATO Alliance

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Speaker 9: has literally kept the peace now for three quarters of

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Speaker 9: a century, and sending a message to our allies that

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Speaker 9: we're in this together. They need to be together with

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Speaker 9: America and with Israel. And my deep conviction and my

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Speaker 9: hope is that we'll hear the present and say tonight

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Speaker 9: that we're gonna We're going to finish this fight once

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Speaker 9: and for all. We're going to I think it's imperative

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Speaker 9: that our forces, Israeli forces continue to strike until two

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Speaker 9: things happen. Number one is that the people of Iran

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Speaker 9: are able to rise up and reclaim the notion. In

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Speaker 9: recent weeks, well, but it's I can tell you I've

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Speaker 9: had the opportunity to meet people in the Iranian diaspora

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Speaker 9: across this country and across the world, there are people

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Speaker 9: hoping and praying that we will create enough space by

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Speaker 9: striking at the internal security forces in Iran where the

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Speaker 9: people can take to the streets as they did in

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Speaker 9: January at great personal risk, and as they did fifteen

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Speaker 9: years ago in the Green Revolution, Kayley. But the other

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Speaker 9: thing is I think it's imperative that we finished the

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Speaker 9: job once and for all to restore deterrence on the

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Speaker 9: world stage. Look, Beijing and Moscow are watching this conflict

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Speaker 9: very closely, and if we if we were to stop short,

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Speaker 9: if we were to take anything less than really a

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Speaker 9: fundamental change in Iran and its ability to project force

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Speaker 9: against others and its own people, I think that would

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Speaker 9: only embolden authoritarian regimes around the world.

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Speaker 3: Even if it necessitates ground troops.

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Speaker 9: Well, I don't believe it will. But at the end

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Speaker 9: of the day, I think allowing this regime, a terrorist regime,

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Speaker 9: to retain power, even with new faces, would imperil America's

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Speaker 9: interest in peril Israel, and I think ultimately be a

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Speaker 9: disservice to the lives have been lost in the last

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Speaker 9: month and to all of those that have been lost

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Speaker 9: over the last forty seven years. Look, as I said,

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Speaker 9: I'm incredibly proud of our armed forces and the job

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Speaker 9: that they've done. I'm proud of the press for pulling

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Speaker 9: the trigger. But now I think it's essential that we

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Speaker 9: finished the job once and for all, and I'm hoping

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Speaker 9: to hear that from the Commander in chief tonight.

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Speaker 8: When you think back to the first term, in the

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Speaker 8: conversations you had with the President, I'm just wondering if

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Speaker 8: this was one that you were actively having then, were

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Speaker 8: there battle plans to deal with Iran at that point?

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Speaker 8: And if that's the case, why didn't you decide to

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Speaker 8: go in so many years ago?

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Speaker 9: Well, it was you know, obviously your military is always

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Speaker 9: developing contingency plans. But I can tell you what we

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Speaker 9: did in the aftermath of eight years of appeasement by

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Speaker 9: the Obama administration was we got out of the Around

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Speaker 9: nuclear deal. We isolated Around economically and diplomatically as never before.

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Speaker 9: We unleashed our armed forces to take down the Isis

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Speaker 9: caliphate that was supported and sponsored by the mulas in Tehran.

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Speaker 9: And of course, the President made the decision in early

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Speaker 9: twenty twenty to take out the head of the Iranian

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Speaker 9: Revolutionary Guard cost him solemn money, was weaker and more

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Speaker 9: isolated than ever before. When we left office. Sadly, the

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Speaker 9: Biden administration reversed all of that, went back to begging

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Speaker 9: for another nuclear deal. And so, you know, our hope

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Speaker 9: was that by bringing economic and diplomatic pressure, and by

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Speaker 9: strategically striking Iran, particularly its leadership during our time, that

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Speaker 9: we'd set the conditions for change in that country's posture.

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Speaker 9: When this administration came in the threat of a nuclear Iran,

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Speaker 9: the President struck with Midnight Hammer a year ago and

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Speaker 9: then unleashed the greatest armed forces in the history of

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Speaker 9: the world a month ago. But again, this battle has

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Speaker 9: been going on for forty seven years since the Malas

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Speaker 9: came to power and took American hostages, and then they

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Speaker 9: took two hundred and forty service members lives when they

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Speaker 9: attacked the Marine Corps barracks in Beirut in nineteen eighty three.

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Speaker 9: This is the fight we've got to finish, and I

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Speaker 9: hope the President conveys to the world that we expect

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Speaker 9: our allies allies to come alongside and we're going to

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Speaker 9: finish this fight.

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Speaker 3: But it seems that the finish you envisioned, mister Vice

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Speaker 3: President is a military one, not a diplomatic one. Do

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Speaker 3: you see no real prospect for a deal, for a

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Speaker 3: successful negotiation.

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Speaker 9: Well, I would tell you that. I think the military

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Speaker 9: makes the conditions possible for regime change.

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Speaker 3: Look, the President is arguing it is a new regime.

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Speaker 1: Well, look that's they're more reasonable.

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Speaker 9: I know the President's reflected on new and reasonable voices,

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Speaker 9: and I hope he's right. I pray he's right. But

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Speaker 9: the search for moderate Mullahs in Tehran has been going

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Speaker 9: on for decades. We can't seem to find any. But

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Speaker 9: that's not true the Iranian people. I want to say,

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Speaker 9: with the global reach of this network, I've had the

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Speaker 9: privilege to come to know people who fled around, whose

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Speaker 9: families are still there. This is a this is It's

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Speaker 9: a very modern country, very western oriented, is a very

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Speaker 9: young country. It has great aspirations and a great history

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Speaker 9: and enormous potential. I think, I think if we continue

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Speaker 9: to use our armed forces and Israel continues to strike,

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Speaker 9: we can create the conditions where the Ranian people will

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Speaker 9: be able to take back their country and the world

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Speaker 9: will be better and safer and more secure and again

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Speaker 9: restoring American credibility, particularly after that disastrous with we're all

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Speaker 9: from Afghanistan. I think has to be on the mind

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Speaker 9: of policymakers as well.

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Speaker 8: Four dollars and six cents is the average price for

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Speaker 8: a gallon of gas today, mister Vice President. And we've

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Speaker 8: seen a huge increase obviously in crude oil and natural

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Speaker 8: gas prices since this all began, and it makes it

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Speaker 8: very difficult for the President to prosecute this war and

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Speaker 8: affects his affordability agenda. At the same time, you've seen

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Speaker 8: this balancing act before. How long can our economy, how

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Speaker 8: long can the politics of this war serve this cost

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Speaker 8: of gas?

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Speaker 9: Well, I think that's what underscores the importance of Tonight's

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Speaker 9: addressed to the nation.

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Speaker 7: Need to address this.

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Speaker 9: Is explaining to the American people what the stakes are

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Speaker 9: and why it is in the interest of the security

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Speaker 9: of the American people, of our cherished ally Israel, and

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Speaker 9: frankly of peace and security in the world for us

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Speaker 9: to finish this job in around And.

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Speaker 8: You think prices will drop precipitously when we leave, as

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Speaker 8: the President says.

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Speaker 9: I would expect that if we secure with the aid

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Speaker 9: of our allies, the Strait of horror moves, or if

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Speaker 9: we use force. I think one of the ideas that

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Speaker 9: is most intriguing to me is to make it clear

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Speaker 9: to the Iranians that even if they let their ships

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Speaker 9: pass through the state of Hormoz, that the US and

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Speaker 9: our allied forces may consider taking possession of those ships

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Speaker 9: and steering them into allies arbors instead. So make it

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Speaker 9: clear to around that they cannot control this straight or

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Speaker 9: there will be costs directly as well to them, beyond

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Speaker 9: every cost that they've paid. But look, there's lots of

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Speaker 9: options on the table. I just think at the end

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Speaker 9: of the day, hearing from the President tonight, the American

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Speaker 9: people are going to understand better the stakes, understand the

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Speaker 9: incredible progress our military has made, and I hope they

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Speaker 9: hear the resolve of a commander in chief that says

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Speaker 9: that we will not rest, we will not relent until

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Speaker 9: the people of Iran have an opportunity to reclaim what

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Speaker 9: I believe is their birthright of freedom.

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Speaker 3: Well, so that is how the President is going to

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Speaker 3: end his day addressing the American people from the White House.

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Speaker 3: But he began his day Sir at the Supreme Court,

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Speaker 3: attending in a historic first arguments in the birthright citizenship case.

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Speaker 3: He of course would like to see that right that

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Speaker 3: is in the United States its constitution revoked. It seems

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Speaker 3: that the justices are skeptical of that. It seems even

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Speaker 3: the President himself knows that he's likely to lose this

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Speaker 3: specific fight. So why wage it in the first place.

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Speaker 9: Well, look, the Supreme Court of the United States has

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Speaker 9: never ruled on whether people that are here illegally and

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Speaker 9: have children that those children become American citizens. So the

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Speaker 9: famous case from the nineteenth century had to do with

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Speaker 9: an Asian family that was in the United States legally

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Speaker 9: at the time as a permanent residence, if memory serves,

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Speaker 9: And frankly, it was a case about an openly racist

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Speaker 9: law against Asians in the country that the court rejected

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Speaker 9: when they recognized birthright citizenship. But this was long before

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Speaker 9: the global transportation that we have. It was long before

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Speaker 9: modern immigration issues had emerged. And so I'm hopeful of

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Speaker 9: Supreme Court will take a careful look at this. I

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Speaker 9: believe that at the end of the day, that that

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Speaker 9: our immigration system is broken. This administration has done, as

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Speaker 9: we did in our four years extraordinary work securing the

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Speaker 9: southern border, of the United States. But the rest of

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Speaker 9: the work remains to be done is fixing a broken

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Speaker 9: immigration system. But having the Supreme Court clarify that that

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Speaker 9: unless you are here in a legal status, and as

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Speaker 9: the Supreme as the Constitution says, in a way that

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Speaker 9: makes you subject to the jurisdiction thereof is the Fourteenth

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Speaker 9: Amendment that there ought to be there ought to be

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Speaker 9: limitations on this principle of birthright citizenship. And I hope

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Speaker 9: they give it. I hope they give it every consideration.

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Speaker 8: Well, wouldn't be the first time if this Court tells

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Speaker 8: us that it's the purview of Congress.

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Speaker 7: That we've heard that in a ruling as well.

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Speaker 8: And I'm wondering what you think about the status of

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Speaker 8: your former House of Representatives when the Department of Homeland

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Speaker 8: Security remains closed today and the President taking to truth

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Speaker 8: social right before you walked in the studio to suggest

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Speaker 8: that the solution may just have to be reconciliation. Reconciliation

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Speaker 8: two point zero could bring funding for DHS, could be

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Speaker 8: an attempt an attempt at vehicle for the Save America Act,

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Speaker 8: and so many other things.

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Speaker 7: Is that how this finally ends.

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Speaker 9: Well, I hope it does. End. Honestly, I just think

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Speaker 9: it's unconscionable at a time that America is at war

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Speaker 9: that Democrats in Congress are withholding funding for the Department

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Speaker 9: of Homeland Security. I was there when we set up

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Speaker 9: the department after nine to eleven. I know the work

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Speaker 9: that they do. It's far beyond airport screening. And the

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Speaker 9: very idea that we have people who work at the

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Speaker 9: very heart of protecting the American people here at home

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Speaker 9: are not being paid is just unthinkable to me. First

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Speaker 9: and foremost, I express that concern, But look, you make

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Speaker 9: a great point about the role of the Congress here.

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Speaker 9: As you know, I spent twelve years in the Congress

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Speaker 9: of the United States before I was a governor and

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Speaker 9: a vice president, and I believe that we deserve an

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Speaker 9: energetic legislature. You talk about birthright citizenship, that's a constitutional

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Speaker 9: fourteenth Amendment issue. But when I was in Congress, I

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Speaker 9: supported a legislation that amended birthright citizenship. Likely expected it

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Speaker 9: to go to the Supreme Court. But I think the

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Speaker 9: American people are well served when we have a legislative

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Speaker 9: process that is working, that's functioning.

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Speaker 5: I get it that.

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Speaker 9: Close small majorities make that difficult. I think Speaker Mike

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Speaker 9: Johnson has done yeomen's work and extending the tax cuts

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Speaker 9: last year and in a number of the measures they've

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Speaker 9: been able to enact. But the American people really want

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Speaker 9: to see us get back to a Congress that is

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Speaker 9: that is working their will, that's going through the legislative process,

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Speaker 9: and particularly when it comes to the safety and security

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Speaker 9: of the American people. Congress just needs to get back

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Speaker 9: to work.

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Speaker 3: All right, mister Vice President, thank you so much for

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Speaker 3: joining us today. Of course, the former Vice President of

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Speaker 3: the United States, Mike Pence.

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Speaker 7: Stay with us on Balance of Power. We'll have much

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Speaker 7: more coming up after this.

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Speaker 2: You're listening to the Bloomberg Balance of Power podcast. Catch

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Speaker 2: us live weekdays at noon and five pm Eastern on

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Speaker 2: Apple Cockway and Android Auto with the Bloomberg Business app.

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Speaker 2: You can also listen live on Amazon Alexa from our

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Speaker 2: flagship New York station.

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Speaker 1: Just say Alexa play Bloomberg eleven thirty.

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Speaker 8: This is one of those days, and glad you're spending

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Speaker 8: it with us here as the President opens the day

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Speaker 8: by making history marching up to the Supreme Court to

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Speaker 8: attend oral arguments, and we might just hear from him shortly.

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Speaker 8: They're telling reporters to be ready if he wants to

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Speaker 8: speak during his Easter lunch. Easter Lunch at the White

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Speaker 8: House today, just one of the stops on the road

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Speaker 8: before a nine pm Eastern address to the nation. We

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Speaker 8: don't have a lot of these from this president. We

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Speaker 8: certainly have not in this second term prime time address,

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Speaker 8: and it's possible he will not be in the Oval

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Speaker 8: Office for the traditional speech behind the Resolute Desk. The

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Speaker 8: President likes to use different venues around the White House,

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Speaker 8: so we're going to be bringing that to you live

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Speaker 8: here on Bloomberg with some sense, some sense of what

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Speaker 8: he might say. This is the market you heard, Charlie.

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Speaker 8: We're tearing again and had new eyes for the session.

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Speaker 8: S and P five hundred up over one percent, the

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Speaker 8: NASDACO almost two percent here certainly more than one and

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Speaker 8: a half percent three hundred and sixty five point advanced

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Speaker 8: for the Nasdaq. With a lot of good feels on

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Speaker 8: this thing winding down. Oil prices are lower, even though

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Speaker 8: we don't know what the President is going to say.

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Speaker 7: We need to be honest about this.

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Speaker 8: With an official at the White House, a senior administration

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Speaker 8: official talking with Bloomberg News that the President will give

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Speaker 8: an operational update on Iran tonight, as opposed to a

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Speaker 8: withdrawal announcement.

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Speaker 7: Right.

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Speaker 8: He will touch success in achieving goals in Iran, presumably

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Speaker 8: the degradation of its military capabilities when it comes to

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Speaker 8: ballistic missiles, and further, when it comes to its nuclear capabilities,

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Speaker 8: which of course, the President said we obliterated last year.

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Speaker 8: He's talked about this more, though, just recent rhetorics suggesting

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Speaker 8: that we had eliminated the country's nuclear abilities, even though

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Speaker 8: as far as we understand, at least, we have not

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Speaker 8: seized the highly enriched uranium that still exists in Iran.

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Speaker 8: This might be the most important point. The President will

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Speaker 8: reiterate what he said yesterday, a two to three week

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Speaker 8: timeline for leaving Iran. Nowhere here does that say a

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Speaker 8: reopened Strait of Hormuz. Nowhere does that say troops deployed

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Speaker 8: on the ground, seizing KRG island, getting our hands on

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Speaker 8: the uranium. Now, this is all on background. The President

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Speaker 8: could say something different this evening. We suppose we're total.

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Speaker 8: He's going to talk for about twenty minutes. Well, the

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Speaker 8: Market Care We talked to Eric Weener about this. Is

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Speaker 8: that enough?

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Speaker 7: Does that sound like we're winding it down?

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Speaker 8: Or is it good enough to say that we're preparing

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Speaker 8: to wind down and we're not committing troops tonight?

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Speaker 7: Not for me to decide. Let's assemble our political panel.

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Speaker 8: Bloomberg Politics contributors Jeanie Schanzano and Rick Davis are with us.

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Speaker 8: Genie as a democratic analyst in democracy visiting fellow at

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Speaker 8: Harvard Kennedy School's Ash Center. Rick Davis, Republican strategist and

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Speaker 8: partner at Stone Court Capital.

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Speaker 7: Rick, what does the market need to hear?

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Speaker 8: I feel like we're having a couple of different conversations here.

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Speaker 8: The American people might have their own questions, the market

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Speaker 8: may have its own hopes. Are we projecting optimism here

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Speaker 8: in the market? And does it make you nervous about

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Speaker 8: the president saying something very different tonight?

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Speaker 10: Well, Joe, first, let me correct you, and I hardly

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Speaker 10: ever do this, but the President, if he speaks from

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Speaker 10: the Oval Office, we'll be speaking from behind the Cno desk,

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Speaker 10: not the resolute desk, which has been sent out.

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Speaker 7: I thought they brought that back in. Is that still out? Jeez?

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Speaker 7: I thought they finished it?

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Speaker 10: Rick, Well, I don't know. Last time I checked it

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Speaker 10: was cno, but maybe you're right. It wouldn't surprise me

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Speaker 10: that I've been corrected once again. So the reality is

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Speaker 10: this may be the first war we've played out in

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Speaker 10: modern history that is basically being orchestrated by the.

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Speaker 5: Whims of the markets.

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Speaker 10: I don't think you can separate the president's decision making

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Speaker 10: from what he's seeing play out in either the oil

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Speaker 10: markets or the capital markets. It's really been some head

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Speaker 10: spinning activity that clearly has been influenced by the global

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Speaker 10: economic activity that has surrounded the war for these last

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Speaker 10: six weeks.

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Speaker 5: So yes, I mean, is there an indication.

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Speaker 10: That there might be brighter resolution of this now that

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Speaker 10: capital markets are getting better? But of course we've seen

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Speaker 10: some of the highest gas prices that we've seen in

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Speaker 10: the United States in quite some time. I think what

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Speaker 10: today was four dollars and six cents, so well well

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Speaker 10: above the four dollars threshold that we've been anticipating seeing.

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Speaker 10: So yeah, I think it's it's if you read the markets,

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Speaker 10: then I think you can get a sense of what

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Speaker 10: the president is going to do tonight. And I think

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Speaker 10: that a lot of his strategy right now is being

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Speaker 10: predicated by how fast can we move to untangle ourselves

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Speaker 10: from this conflict in order for the economy to recover

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Speaker 10: with enough time to have an impact before the midterms.

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Speaker 8: Two to three weeks, Genie, does that need to include

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Speaker 8: an open straight of horror moves? We talked to the

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Speaker 8: spokesman for the American Petroleum Institute last evening. He said, yes,

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Speaker 8: it's got to happen, which means that on mobile Chevron

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Speaker 8: and all the other members are saying that too. Mick

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Speaker 8: mulvaney also made that point. You can't leave without reopening

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Speaker 8: the strait. Is that what's about to happen?

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Speaker 11: Yeah, Joe, Now you know how I feel being schooled

442
00:25:12,680 --> 00:25:16,680
Speaker 11: by Rick Davis, which I get on a daily base. Oh,

443
00:25:17,280 --> 00:25:23,439
Speaker 11: I'm glad you're joining me. Is it is unbelievably irresponsible

444
00:25:24,080 --> 00:25:28,720
Speaker 11: for the United States to leave that straight closed, and

445
00:25:29,200 --> 00:25:33,320
Speaker 11: the President has this idea that we can break it

446
00:25:33,400 --> 00:25:37,360
Speaker 11: and presumably just walk away. I would be stunned if

447
00:25:37,400 --> 00:25:41,560
Speaker 11: the markets are open to that idea, because the impact

448
00:25:41,600 --> 00:25:45,920
Speaker 11: of that economically would be devastating. I suspect there's a

449
00:25:45,960 --> 00:25:48,639
Speaker 11: couple things. What the President I think is going to

450
00:25:48,680 --> 00:25:50,960
Speaker 11: do is he's going to do what he did yesterday,

451
00:25:51,240 --> 00:25:54,800
Speaker 11: which is declare victory. He's going to talk about defeating

452
00:25:54,800 --> 00:25:58,200
Speaker 11: the Iranian navy. Well, you know, that's a little bit

453
00:25:58,320 --> 00:26:01,280
Speaker 11: like sending an own NFL t into like the nearby

454
00:26:01,359 --> 00:26:03,960
Speaker 11: high school and saying, whoa they really? They really got

455
00:26:03,960 --> 00:26:06,679
Speaker 11: the best of them. That was never a strong navy.

456
00:26:07,119 --> 00:26:10,520
Speaker 11: Their powers are asymmetric. That's how they shut down the

457
00:26:10,560 --> 00:26:14,480
Speaker 11: straight He's going to talk about decapitating the regime, but

458
00:26:14,560 --> 00:26:17,159
Speaker 11: of course we've had regime change in the wrong direction.

459
00:26:17,320 --> 00:26:20,040
Speaker 11: We have a more hard line regime and power. So

460
00:26:20,440 --> 00:26:22,800
Speaker 11: what he's going to talk about is that kind of

461
00:26:22,840 --> 00:26:26,320
Speaker 11: stuff victory. But what he needs to talk about is

462
00:26:26,440 --> 00:26:29,200
Speaker 11: how he is going to step back from this, how

463
00:26:29,200 --> 00:26:32,919
Speaker 11: he is going to de escalate without leaving things worse

464
00:26:33,000 --> 00:26:35,560
Speaker 11: than we found them. And in order to do that,

465
00:26:35,960 --> 00:26:39,040
Speaker 11: he needs to have that straight open, which is why

466
00:26:39,080 --> 00:26:43,160
Speaker 11: he spent so much time berating our allies and threatening

467
00:26:43,240 --> 00:26:47,040
Speaker 11: last night to leave NATO, because he is so frustrated

468
00:26:47,040 --> 00:26:50,159
Speaker 11: by the allies there who won't take up what he

469
00:26:50,359 --> 00:26:52,360
Speaker 11: started and finished the job for us.

470
00:26:53,400 --> 00:26:56,520
Speaker 8: We've discussed evolving objectives here, Rick and Jeanie and I

471
00:26:56,560 --> 00:26:59,040
Speaker 8: find it interesting what we've settled on here.

472
00:26:59,760 --> 00:27:01,280
Speaker 7: In in the past what I don't know.

473
00:27:01,359 --> 00:27:04,879
Speaker 8: Forty eight hours, the most recent news cycle has brought

474
00:27:05,760 --> 00:27:09,240
Speaker 8: this down to a crystallized four or five points. Destroying

475
00:27:09,240 --> 00:27:12,159
Speaker 8: the ballistic missiles that I mentioned reck annihilating the navy

476
00:27:12,280 --> 00:27:16,520
Speaker 8: Genie just referred to ensuring terrorist proxies can no longer

477
00:27:16,560 --> 00:27:19,840
Speaker 8: destabilize the region and guarantee that Iran cannot get a

478
00:27:19,920 --> 00:27:23,640
Speaker 8: nuclear weapon. When did the straight fall off that list

479
00:27:23,720 --> 00:27:27,160
Speaker 8: or was it never on there? Well, I think you've

480
00:27:27,200 --> 00:27:33,919
Speaker 8: got to separate achieved objectives of this conflict versus the

481
00:27:34,000 --> 00:27:35,240
Speaker 8: reasons we got into it.

482
00:27:36,720 --> 00:27:38,639
Speaker 10: I think you can't leave out the fact that the

483
00:27:38,640 --> 00:27:42,760
Speaker 10: President himself talked about the eminent threat of the Iranian

484
00:27:43,720 --> 00:27:47,800
Speaker 10: government pursuing a nuclear weapon. Right that was out there,

485
00:27:48,160 --> 00:27:50,800
Speaker 10: and it was a It was almost a precondition for

486
00:27:51,080 --> 00:27:57,000
Speaker 10: the attack too. I don't think this administration ever inoculated

487
00:27:57,040 --> 00:27:59,920
Speaker 10: the public to the idea that the strait might get closed.

488
00:28:00,720 --> 00:28:03,840
Speaker 10: I don't recall a single instance before the conflict started

489
00:28:03,840 --> 00:28:06,119
Speaker 10: that they said, and by the way, if we do

490
00:28:06,240 --> 00:28:08,320
Speaker 10: go to war with Iran, we'll make sure that the

491
00:28:08,320 --> 00:28:10,959
Speaker 10: Straight of horm Moose stays open. We didn't hear that

492
00:28:11,280 --> 00:28:15,000
Speaker 10: at all. And so now this is after the fact,

493
00:28:15,560 --> 00:28:19,240
Speaker 10: we have an economic dislocation with the Straight of horm

494
00:28:19,320 --> 00:28:21,919
Speaker 10: Mouse being shut by Iran, who can do it with

495
00:28:22,160 --> 00:28:27,400
Speaker 10: very little capacity, that they have left effectively holding the

496
00:28:27,760 --> 00:28:32,440
Speaker 10: entire world's oil supplier twenty percent of it for ransom.

497
00:28:32,560 --> 00:28:35,200
Speaker 10: And so this is a ransom demand in my view,

498
00:28:35,440 --> 00:28:41,000
Speaker 10: not an accomplishment or a detriment to the negotiations about

499
00:28:41,120 --> 00:28:42,040
Speaker 10: settling this war.

500
00:28:43,240 --> 00:28:46,200
Speaker 8: You know, Genie, the President posted this morning truth socially

501
00:28:46,200 --> 00:28:48,560
Speaker 8: he won't accept the ceasefire, which of course Iran now

502
00:28:48,560 --> 00:28:53,320
Speaker 8: says was never offered until the strait is reopened. Do

503
00:28:53,400 --> 00:28:55,680
Speaker 8: we have to parse the words there, because that doesn't

504
00:28:55,760 --> 00:28:58,920
Speaker 8: mean we won't leave before the strait is reopened. It's

505
00:28:58,960 --> 00:29:04,840
Speaker 8: about whether we actually codify a deal and react to

506
00:29:04,840 --> 00:29:05,560
Speaker 8: what Rick said.

507
00:29:06,120 --> 00:29:07,840
Speaker 7: Is this not what we should be expecting?

508
00:29:10,040 --> 00:29:13,880
Speaker 11: You know, Sentcom warned, the President warned the administration prior

509
00:29:14,000 --> 00:29:16,520
Speaker 11: to this excursion, as he likes to call it, that

510
00:29:16,760 --> 00:29:19,480
Speaker 11: they had the ability to close the straight, and the President,

511
00:29:19,600 --> 00:29:22,400
Speaker 11: based primarily I guess on what happened in Venezuela, said

512
00:29:22,440 --> 00:29:24,560
Speaker 11: oh no, they'll surrender before that.

513
00:29:24,560 --> 00:29:26,040
Speaker 1: That has not happened.

514
00:29:26,360 --> 00:29:29,320
Speaker 11: And you go through the list of those five new

515
00:29:29,440 --> 00:29:33,560
Speaker 11: objectives or renewed objectives, and you have to really think

516
00:29:33,600 --> 00:29:36,240
Speaker 11: about how many of those have really been met. Have

517
00:29:36,280 --> 00:29:39,080
Speaker 11: we really dealt with the proxies? No, we have not.

518
00:29:39,440 --> 00:29:42,400
Speaker 11: We still have the houthis threatening to close the Red Sea.

519
00:29:42,920 --> 00:29:46,360
Speaker 11: We haven't decapitated the regime. We haven't destroyed it. This

520
00:29:46,400 --> 00:29:50,760
Speaker 11: is a regime that is undecapitatable. That's a new word, Joe.

521
00:29:50,840 --> 00:29:53,680
Speaker 11: You can't decapitate a regime as far as I know.

522
00:29:53,880 --> 00:29:57,360
Speaker 11: You can't decapitate a regime because it's not built like

523
00:29:57,480 --> 00:30:02,480
Speaker 11: a typical totalitarian regime, is a deeply embedded regime. It's

524
00:30:02,600 --> 00:30:05,120
Speaker 11: not going to be one like North Korea. You take

525
00:30:05,160 --> 00:30:07,360
Speaker 11: off the head and the whole thing falls. Now we

526
00:30:07,520 --> 00:30:10,720
Speaker 11: know that, so you know, you go through the ballistic missiles,

527
00:30:10,760 --> 00:30:14,600
Speaker 11: they still have that capability. The nuclear program, we are

528
00:30:14,680 --> 00:30:15,800
Speaker 11: in worse condition today.

529
00:30:15,840 --> 00:30:17,400
Speaker 1: They have half a ton.

530
00:30:17,600 --> 00:30:21,480
Speaker 11: Of unenriched nuclear materials sitting there. If we walk away,

531
00:30:21,920 --> 00:30:25,720
Speaker 11: what happens to that? So even this five list of

532
00:30:25,800 --> 00:30:30,800
Speaker 11: new objectives pushing aside the straight we haven't achieved them.

533
00:30:31,200 --> 00:30:32,960
Speaker 11: And you know, it's hard to know what to make

534
00:30:33,000 --> 00:30:37,080
Speaker 11: of the President's constantly changing ideas and thoughts that he

535
00:30:37,160 --> 00:30:40,120
Speaker 11: seems to share with us on real time via truth

536
00:30:40,200 --> 00:30:45,000
Speaker 11: social and in his conversations with recorders and elsewhere. Tonight,

537
00:30:45,080 --> 00:30:47,440
Speaker 11: what I think the President needs to do is tell

538
00:30:47,520 --> 00:30:50,160
Speaker 11: us is he going to do something that's going to

539
00:30:50,200 --> 00:30:53,920
Speaker 11: make the United States look incredibly weak, walk away with

540
00:30:54,000 --> 00:30:57,320
Speaker 11: the straight closed and de escalate this thing, or does

541
00:30:57,320 --> 00:31:00,000
Speaker 11: he have another path to de escalation that we don't

542
00:31:00,160 --> 00:31:02,960
Speaker 11: know about, Or is he going to escalate and use

543
00:31:03,040 --> 00:31:06,120
Speaker 11: these troops that are sitting there or on their way,

544
00:31:06,400 --> 00:31:09,200
Speaker 11: thousands of them, to go in and then be sitting

545
00:31:09,280 --> 00:31:11,960
Speaker 11: ducks in some of these islands and get us into

546
00:31:12,000 --> 00:31:14,840
Speaker 11: like a Vietnam scenario where you're going to have Iran

547
00:31:14,880 --> 00:31:16,800
Speaker 11: attacking our troops or in the mainland. What do we

548
00:31:16,800 --> 00:31:19,760
Speaker 11: do then we slowly go into Iran and try to

549
00:31:20,160 --> 00:31:24,080
Speaker 11: destroy a country with ninety three million people. These are

550
00:31:24,200 --> 00:31:27,600
Speaker 11: all bad options, and the President should not tonight, which

551
00:31:27,600 --> 00:31:30,080
Speaker 11: I think he will do, tell about how he is

552
00:31:30,120 --> 00:31:32,560
Speaker 11: winning and we have won. He should give us a

553
00:31:32,640 --> 00:31:35,840
Speaker 11: realistic view as to how we get out of this

554
00:31:36,080 --> 00:31:38,280
Speaker 11: very bad position that he's gotten us into in the

555
00:31:38,320 --> 00:31:38,840
Speaker 11: Middle East.

556
00:31:40,000 --> 00:31:42,960
Speaker 8: I'm asking you, guys, questions that cannot be answered. We're

557
00:31:42,960 --> 00:31:47,240
Speaker 8: all kind of asking rhetorical questions here in our conversation, Rick,

558
00:31:47,280 --> 00:31:51,640
Speaker 8: in our remaining moment, are you allowing for the possibility

559
00:31:51,680 --> 00:31:55,440
Speaker 8: that President Trump says, you know, upon my order, troops

560
00:31:55,440 --> 00:31:58,520
Speaker 8: are now moving into Iran or have already to seize

561
00:31:58,680 --> 00:32:00,760
Speaker 8: the highly enriched uranium.

562
00:32:00,840 --> 00:32:02,360
Speaker 5: Yeah, I don't think you can discount it.

563
00:32:02,400 --> 00:32:05,960
Speaker 10: Those troops, the special Forces, the Green Berets, the eighty

564
00:32:05,960 --> 00:32:09,440
Speaker 10: second Airborne, they're there for a reason, and if they're there,

565
00:32:10,000 --> 00:32:12,760
Speaker 10: it's easier to use them if they're not, And so

566
00:32:13,320 --> 00:32:17,200
Speaker 10: it creates the opportunity for the President and his general

567
00:32:17,200 --> 00:32:20,800
Speaker 10: staff to mobilize at a moment's notice. And if that's

568
00:32:20,840 --> 00:32:24,760
Speaker 10: the case, then you cannot discount the President making use

569
00:32:24,920 --> 00:32:28,360
Speaker 10: of this very potent force, for the nuclear material, for

570
00:32:28,480 --> 00:32:32,120
Speaker 10: opening the Strait, for many other objectives that they might

571
00:32:32,160 --> 00:32:32,840
Speaker 10: have in this war.

572
00:32:34,080 --> 00:32:36,440
Speaker 8: We've got a lot to learn here yet today, and

573
00:32:36,480 --> 00:32:40,080
Speaker 8: that speech is several hours from now, nine pm Eastern.

574
00:32:40,200 --> 00:32:42,320
Speaker 7: Stay with us on Balance of Power. We'll have much

575
00:32:42,320 --> 00:32:43,520
Speaker 7: more coming up after this.

576
00:32:47,760 --> 00:32:51,240
Speaker 2: You're listening to the Bloomberg Balance of Power podcasts. Catch

577
00:32:51,320 --> 00:32:54,760
Speaker 2: us live weekdays at noon and five pm Eastern on Apple,

578
00:32:54,840 --> 00:32:57,720
Speaker 2: Corplay and Android Auto with the Bloomberg Business app.

579
00:32:57,760 --> 00:32:59,719
Speaker 1: You can also listen live on Amazon.

580
00:32:59,760 --> 00:33:03,040
Speaker 2: A line from our flagship New York station does say

581
00:33:03,160 --> 00:33:05,960
Speaker 2: Alexa played Bloomberg eleven thirty.

582
00:33:06,840 --> 00:33:08,800
Speaker 3: We haven't actually had to wait until nine pm to

583
00:33:08,840 --> 00:33:11,479
Speaker 3: hear from the President today. He's been quite active on

584
00:33:11,520 --> 00:33:14,360
Speaker 3: True Social, most recently Joe posting about funding the Department

585
00:33:14,400 --> 00:33:17,760
Speaker 3: of Homeland Security ICE and CBP specifically looks like he's

586
00:33:17,800 --> 00:33:20,680
Speaker 3: advocating for reconciliation. We've also, of course heard from him

587
00:33:21,040 --> 00:33:23,560
Speaker 3: regarding the war in Iran that Iran has requested a

588
00:33:23,600 --> 00:33:26,720
Speaker 3: cease fire. He needs to see the Strait of Hormuz

589
00:33:26,760 --> 00:33:28,960
Speaker 3: open first. But he two weighed in on the case

590
00:33:29,000 --> 00:33:31,200
Speaker 3: that was being heard in the Supreme Court today around

591
00:33:31,200 --> 00:33:34,640
Speaker 3: birthright citizenship, posting on True Social a short time ago,

592
00:33:34,680 --> 00:33:36,640
Speaker 3: we are the only country in the world stupid enough

593
00:33:36,800 --> 00:33:40,520
Speaker 3: to allow birthright citizenship. It's not actually true. There's some

594
00:33:40,640 --> 00:33:44,760
Speaker 3: thirty odd countries that also have laws like this. But

595
00:33:44,960 --> 00:33:47,080
Speaker 3: it does seem that the President is reading the writing

596
00:33:47,120 --> 00:33:48,920
Speaker 3: of the wall on how this court is going to

597
00:33:49,000 --> 00:33:49,720
Speaker 3: rule on this one.

598
00:33:49,880 --> 00:33:50,080
Speaker 7: Yeah.

599
00:33:50,120 --> 00:33:52,760
Speaker 8: I don't know how stupid this will seem once the

600
00:33:52,760 --> 00:33:56,160
Speaker 8: court rules, but apparently there is some skepticism surrounding the

601
00:33:56,160 --> 00:34:01,200
Speaker 8: President's case here and that is what we expected. Bloomberg's

602
00:34:01,200 --> 00:34:03,920
Speaker 8: Tyler Kendall spent the morning at the Supreme Court as

603
00:34:03,960 --> 00:34:07,320
Speaker 8: the President made history. He attended the arguments in person,

604
00:34:08,000 --> 00:34:11,040
Speaker 8: did not talk to reporters while he was there, but

605
00:34:11,120 --> 00:34:12,760
Speaker 8: Tyler talked to a lot of other folks.

606
00:34:12,840 --> 00:34:13,239
Speaker 2: It was a.

607
00:34:13,239 --> 00:34:17,280
Speaker 8: Rambunctious, very loud, noisy crowd. A lot of protesters showed

608
00:34:17,320 --> 00:34:22,120
Speaker 8: up just for the actual arguments. As the justices questioned

609
00:34:22,120 --> 00:34:24,840
Speaker 8: whether this executive order issued by the President could be

610
00:34:24,880 --> 00:34:28,160
Speaker 8: squared with the Constitution and federal law, Tyler's made her

611
00:34:28,200 --> 00:34:29,960
Speaker 8: way back to the White House. Let's see how things

612
00:34:29,960 --> 00:34:32,400
Speaker 8: are going right now, with of course the primetime address

613
00:34:33,040 --> 00:34:35,839
Speaker 8: set for nine pm Eastern Time in that building right

614
00:34:35,880 --> 00:34:39,840
Speaker 8: behind Tyler. Did the President have any other opportunities to

615
00:34:39,880 --> 00:34:42,759
Speaker 8: weigh in here, Tyler? Do we expect to hear him

616
00:34:42,760 --> 00:34:44,000
Speaker 8: talk about this tonight.

617
00:34:45,239 --> 00:34:48,480
Speaker 6: When it comes to the birthright citizenship ruling or are

618
00:34:48,640 --> 00:34:52,200
Speaker 6: on because of course, Joe well birthright citizenship Beyond what

619
00:34:52,280 --> 00:34:55,400
Speaker 6: Kaylee just read with the president's post on true social there,

620
00:34:55,560 --> 00:34:57,560
Speaker 6: that's really all that we've heard from him. We knew

621
00:34:57,560 --> 00:35:00,680
Speaker 6: that he had Easter lunch today at twelve thirty Eastern.

622
00:35:00,760 --> 00:35:03,160
Speaker 6: He has a three pm policy meeting. Perhaps that will

623
00:35:03,160 --> 00:35:05,839
Speaker 6: open up to reporters. Other than that, our eyes are

624
00:35:05,880 --> 00:35:08,879
Speaker 6: just absolutely trained on nine pm Eastern tonight. I can't

625
00:35:08,880 --> 00:35:11,040
Speaker 6: say at the moment. It is a lot quieter here

626
00:35:11,080 --> 00:35:12,960
Speaker 6: where I am now compared to when you and I

627
00:35:13,000 --> 00:35:15,640
Speaker 6: spoke last hour outside of the Supreme Court, and we

628
00:35:15,680 --> 00:35:18,600
Speaker 6: really saw President Trump make history here becoming the first

629
00:35:18,680 --> 00:35:22,560
Speaker 6: sitting US president to attend oral arguments in the modern era,

630
00:35:22,760 --> 00:35:25,680
Speaker 6: where these justices are deciding what really is a key

631
00:35:25,760 --> 00:35:29,320
Speaker 6: policy and a hardline immigration tactic that this White House

632
00:35:29,400 --> 00:35:30,839
Speaker 6: is doubling down on.

633
00:35:30,880 --> 00:35:32,480
Speaker 5: So want to watch out for sure.

634
00:35:32,640 --> 00:35:35,480
Speaker 6: As you guys have mentioned on the program, though, today

635
00:35:35,600 --> 00:35:38,239
Speaker 6: was just to get those signals from the justices on

636
00:35:38,360 --> 00:35:41,880
Speaker 6: how they could be voting. Bloomberg News's assessment is that

637
00:35:41,920 --> 00:35:45,160
Speaker 6: those justices were skeptical of the arguments from the Trump

638
00:35:45,200 --> 00:35:48,400
Speaker 6: administration when it comes to President Trump's executive order seeking

639
00:35:48,840 --> 00:35:56,280
Speaker 6: to bar US born children of undocumented immigrants from gaining citizenship.

640
00:35:56,520 --> 00:35:59,160
Speaker 6: But at this point that the case isn't decided, we're

641
00:35:59,160 --> 00:36:02,000
Speaker 6: expecting that to happen though before the end of June,

642
00:36:02,160 --> 00:36:05,160
Speaker 6: when the Court's term is ultimately up.

643
00:36:07,040 --> 00:36:09,719
Speaker 3: All right, So the justices obviously have some decisions to

644
00:36:09,719 --> 00:36:12,400
Speaker 3: make in some time to do so, the President, arguably Tyler,

645
00:36:12,440 --> 00:36:14,760
Speaker 3: also has some decisions to make on a shorter timeline

646
00:36:14,760 --> 00:36:17,879
Speaker 3: when it comes to Iran. He told reporters last night

647
00:36:17,920 --> 00:36:19,960
Speaker 3: two to three more weeks of this conflict. Should we

648
00:36:20,000 --> 00:36:23,480
Speaker 3: expect echoes of that in his address tonight, Kayley.

649
00:36:23,520 --> 00:36:25,279
Speaker 6: At this point, a White House official tells us here

650
00:36:25,320 --> 00:36:26,960
Speaker 6: at Bloomberg News that this is going to be an

651
00:36:27,000 --> 00:36:29,960
Speaker 6: operational update, in their words, when it comes to what

652
00:36:30,080 --> 00:36:32,800
Speaker 6: is happening on the ground in Iran. We are expecting

653
00:36:32,800 --> 00:36:35,000
Speaker 6: this to be a tactical update, as this White House

654
00:36:35,000 --> 00:36:37,880
Speaker 6: has really been trying to tout the tactical successes in

655
00:36:37,920 --> 00:36:40,919
Speaker 6: President Trump yesterday reiterating that the US's main goal here

656
00:36:40,960 --> 00:36:43,360
Speaker 6: is to ensure that Iran is unable to get a

657
00:36:43,440 --> 00:36:46,359
Speaker 6: nuclear weapon. But the question about what a potential off

658
00:36:46,440 --> 00:36:49,279
Speaker 6: ramp could look like has really been fueled over the

659
00:36:49,320 --> 00:36:52,080
Speaker 6: last twenty four hours because you had President Trump yesterday

660
00:36:52,120 --> 00:36:54,759
Speaker 6: suggesting that he does not need an agreement to be

661
00:36:54,840 --> 00:36:58,320
Speaker 6: in place in order to cease US military operations in Iran.

662
00:36:58,360 --> 00:36:59,920
Speaker 6: But then, of course we've heard from him earlier too,

663
00:37:00,239 --> 00:37:02,680
Speaker 6: demanding that the strait of her moves be open before

664
00:37:02,719 --> 00:37:06,360
Speaker 6: the US agrees to any potential ceasefire. Iran has pushed

665
00:37:06,360 --> 00:37:09,040
Speaker 6: back that they have even offered that a ceasefire could

666
00:37:09,080 --> 00:37:11,080
Speaker 6: be on the table as we try to delineate where

667
00:37:11,160 --> 00:37:14,360
Speaker 6: potential diplomatic talks stand now. As you both well know,

668
00:37:14,440 --> 00:37:17,520
Speaker 6: the White House maintains that negotiations are indeed ongoing.

669
00:37:17,560 --> 00:37:19,440
Speaker 7: We heard from Secretary of ptexth just.

670
00:37:19,480 --> 00:37:22,400
Speaker 6: Yesterday saying that they were gaining strength, though at this

671
00:37:22,480 --> 00:37:25,160
Speaker 6: point Iran maintains that they are not in these formal

672
00:37:25,200 --> 00:37:26,720
Speaker 6: talks with the US.

673
00:37:28,600 --> 00:37:31,279
Speaker 3: All right, Bloomberg's Tyler Kenthal live at the White House

674
00:37:31,280 --> 00:37:33,319
Speaker 3: where we will be hearing from the President later. Thank

675
00:37:33,360 --> 00:37:35,000
Speaker 3: you so much, And of course, a big question on

676
00:37:35,040 --> 00:37:37,200
Speaker 3: the market's mind is how will the President, if at all,

677
00:37:37,600 --> 00:37:40,839
Speaker 3: addressed the reopening of the Strait of Horror moves. This

678
00:37:40,880 --> 00:37:43,759
Speaker 3: is an issue specifically that the oil market is fixated on,

679
00:37:43,800 --> 00:37:46,920
Speaker 3: but of course has broader ramifications for the global economy,

680
00:37:46,920 --> 00:37:48,879
Speaker 3: and it's something we discussed on Balance of Power last

681
00:37:48,880 --> 00:37:52,720
Speaker 3: evening with the CEO of the American Petroleum Institute, Mike Summers,

682
00:37:52,719 --> 00:37:56,200
Speaker 3: whose of course member companies are very benefiting from higher

683
00:37:56,200 --> 00:37:59,000
Speaker 3: oil prices, but he wishoed a warning about the necessity

684
00:37:59,360 --> 00:38:00,440
Speaker 3: of reopening the street.

685
00:38:01,040 --> 00:38:03,200
Speaker 12: The bottom line is, we have to get the Straight open,

686
00:38:03,400 --> 00:38:05,719
Speaker 12: and we have to get it open soon. If the

687
00:38:05,760 --> 00:38:08,560
Speaker 12: Straight of Hormones remains closed, prices are going to remain

688
00:38:08,719 --> 00:38:11,279
Speaker 12: at an elevated level. The pain on consumers is just

689
00:38:11,320 --> 00:38:14,200
Speaker 12: going to be too high. So the top priority has

690
00:38:14,200 --> 00:38:16,520
Speaker 12: to be to get the Straight open as quickly as possible.

691
00:38:18,600 --> 00:38:20,160
Speaker 3: So for more on this, we turn to Tom Close,

692
00:38:20,200 --> 00:38:23,000
Speaker 3: a chief energy advisor for Gulf Oil, who is here

693
00:38:23,040 --> 00:38:25,960
Speaker 3: with us on Bloomberg TV and Radio. Tom, I'm curious

694
00:38:26,000 --> 00:38:28,880
Speaker 3: if you agree with Mike's assessment. When we have the

695
00:38:28,920 --> 00:38:32,280
Speaker 3: President saying things like, as soon as the US leaves,

696
00:38:32,280 --> 00:38:36,359
Speaker 3: the street will automatically be open. What's the consequence if

697
00:38:36,360 --> 00:38:36,680
Speaker 3: it is not.

698
00:38:38,120 --> 00:38:42,440
Speaker 13: I think the consequences we go higher and oil prices

699
00:38:42,520 --> 00:38:46,759
Speaker 13: become an abstraction, and I would probably counter some of

700
00:38:46,760 --> 00:38:49,520
Speaker 13: the things that's the President saying with the notion that

701
00:38:50,360 --> 00:38:53,920
Speaker 13: you know, we've seen a regime change, and the regime

702
00:38:54,000 --> 00:38:56,759
Speaker 13: change is not in Iran. The regime change is in

703
00:38:56,840 --> 00:39:00,520
Speaker 13: the people that operate in the straight of foremodes. And

704
00:39:00,719 --> 00:39:04,799
Speaker 13: even if there's peace in our progress on piece, we're

705
00:39:04,800 --> 00:39:09,000
Speaker 13: probably looking at weeks of that straight having at least

706
00:39:09,400 --> 00:39:14,080
Speaker 13: some sort of modified traffic. So today is an interactment today,

707
00:39:14,120 --> 00:39:16,800
Speaker 13: maybe look back as the day. Well, well, the president

708
00:39:16,920 --> 00:39:20,240
Speaker 13: jawbone the market down, but I think the market's going higher.

709
00:39:21,520 --> 00:39:22,400
Speaker 7: Wow. Interesting.

710
00:39:22,480 --> 00:39:25,880
Speaker 8: Well, Tom, it's always great to talk with you because

711
00:39:25,920 --> 00:39:29,120
Speaker 8: we have so many armchair quarterbacks when it comes to

712
00:39:29,120 --> 00:39:32,240
Speaker 8: the energy market here, and you actually know what traders

713
00:39:32,239 --> 00:39:34,400
Speaker 8: are saying, what the sentiment is and the oil pits.

714
00:39:34,440 --> 00:39:38,360
Speaker 8: If the President simply reiterates two to three week timeline,

715
00:39:38,360 --> 00:39:41,799
Speaker 8: for instance, and does not actually get more detailed on

716
00:39:41,920 --> 00:39:46,319
Speaker 8: withdrawal or reopening of the strait, how disappointed might this

717
00:39:46,400 --> 00:39:46,880
Speaker 8: market be?

718
00:39:48,600 --> 00:39:52,040
Speaker 13: I think, you know, I created a word earlier called

719
00:39:52,160 --> 00:39:56,319
Speaker 13: hyper parabolic, you know, kind of hyperbole plus parabola, And

720
00:39:56,360 --> 00:39:59,560
Speaker 13: I think that's what we might be looking at shortly,

721
00:40:00,080 --> 00:40:03,719
Speaker 13: because we've lost somewhere and you know, we're starting to

722
00:40:03,760 --> 00:40:06,560
Speaker 13: see the barrel counters among the big banks, and some

723
00:40:06,640 --> 00:40:10,160
Speaker 13: of them are estimating that we've lost five hundred million

724
00:40:10,239 --> 00:40:14,480
Speaker 13: barrels of crude oil, refined products of petrochemicals. I mean

725
00:40:14,520 --> 00:40:17,399
Speaker 13: to say that's unprecedent. It just to say that night

726
00:40:17,880 --> 00:40:21,440
Speaker 13: is unprecedented in daylight. I mean, it's just an incredible,

727
00:40:21,480 --> 00:40:26,320
Speaker 13: incredible loss. And that was the buffer. That was the buffer,

728
00:40:26,360 --> 00:40:29,040
Speaker 13: and you could argue that that's why crude oil prices

729
00:40:29,280 --> 00:40:32,839
Speaker 13: didn't really go parabolic. But if it looks as though

730
00:40:33,320 --> 00:40:37,279
Speaker 13: we're going to have intermittent traffic or obstructed traffic in

731
00:40:37,320 --> 00:40:39,280
Speaker 13: the month of April, we're in trouble.

732
00:40:41,120 --> 00:40:43,520
Speaker 3: Well, the President would argue that the US can help

733
00:40:43,520 --> 00:40:45,680
Speaker 3: with that. On true social yesterday he was saying, even

734
00:40:45,719 --> 00:40:47,600
Speaker 3: when it comes to products like jet fuel, the US

735
00:40:47,640 --> 00:40:49,480
Speaker 3: has plenty of it. Allies can either get it from

736
00:40:49,560 --> 00:40:52,800
Speaker 3: US or go take it themselves in the street of Hormus.

737
00:40:52,880 --> 00:40:57,160
Speaker 3: To what extent is US production able to compensate?

738
00:40:57,280 --> 00:40:57,480
Speaker 9: Here?

739
00:40:57,560 --> 00:40:58,160
Speaker 4: Tom?

740
00:40:58,680 --> 00:41:02,600
Speaker 13: You know, Okay, this is a ring circus, and until now,

741
00:41:02,920 --> 00:41:07,360
Speaker 13: two of the rings have just seen incredible price spikes,

742
00:41:07,440 --> 00:41:11,360
Speaker 13: that being Asia and Africa. In Europe. Now it looks

743
00:41:11,400 --> 00:41:14,479
Speaker 13: as though the United States or North America may join

744
00:41:14,560 --> 00:41:17,279
Speaker 13: the rings. In the past couple of days, I can

745
00:41:17,320 --> 00:41:19,719
Speaker 13: tell you that in the last three years, I never

746
00:41:19,760 --> 00:41:22,440
Speaker 13: saw any cargoes put together in New York Harver. You know,

747
00:41:22,480 --> 00:41:25,200
Speaker 13: those big tank shopaths on the way to the city.

748
00:41:26,000 --> 00:41:28,719
Speaker 13: They never load for export. But we've seen five or

749
00:41:28,760 --> 00:41:31,439
Speaker 13: six cargoes loaded for export, a couple of them jet

750
00:41:31,440 --> 00:41:35,040
Speaker 13: fuel and a few of them diesel. That's wonderful, and

751
00:41:35,080 --> 00:41:37,960
Speaker 13: it's great for capitalism to send it overseas where the

752
00:41:38,000 --> 00:41:42,040
Speaker 13: prices are higher, but ultimately it may end up biting

753
00:41:42,120 --> 00:41:42,920
Speaker 13: us in the behind.

754
00:41:44,320 --> 00:41:44,960
Speaker 7: Really interesting.

755
00:41:45,000 --> 00:41:47,279
Speaker 8: I want to get into the price of gas here, Tom,

756
00:41:47,320 --> 00:41:52,160
Speaker 8: we're out four dollars six cents. If you see another

757
00:41:52,320 --> 00:41:57,319
Speaker 8: parabolic move in oil prices, what's the next stop for gas?

758
00:41:57,400 --> 00:41:59,920
Speaker 8: And I realized this is a national average. The price

759
00:42:00,040 --> 00:42:02,120
Speaker 8: being paid in California is a lot different than what

760
00:42:02,600 --> 00:42:04,760
Speaker 8: I'm paying in Virginia, for instance.

761
00:42:04,760 --> 00:42:06,560
Speaker 7: But how worried are you about this?

762
00:42:06,640 --> 00:42:11,160
Speaker 8: By continuing even if crude oil does not, I think

763
00:42:11,239 --> 00:42:11,839
Speaker 8: that they have.

764
00:42:11,880 --> 00:42:14,160
Speaker 13: Some leavers that are going to pull, even though those

765
00:42:14,280 --> 00:42:17,239
Speaker 13: leaders may not make sense. For example, I do think

766
00:42:17,280 --> 00:42:19,959
Speaker 13: that we would see a federal tax holiday, and that's

767
00:42:20,120 --> 00:42:23,839
Speaker 13: eighteen cents of where we've all then. I don't think

768
00:42:23,880 --> 00:42:26,560
Speaker 13: you'll see anything like the president asking for people to

769
00:42:26,640 --> 00:42:30,160
Speaker 13: make sacrifices, even though you can make a compelling argument

770
00:42:30,200 --> 00:42:32,160
Speaker 13: that if you pay a little bit more for fuel

771
00:42:32,200 --> 00:42:35,839
Speaker 13: now and you have a nuclear free Iran for the

772
00:42:35,880 --> 00:42:39,759
Speaker 13: next fifty years. That's a pretty good swat, so it's

773
00:42:39,880 --> 00:42:42,040
Speaker 13: going to be really interesting. I can tell you, Joe

774
00:42:42,080 --> 00:42:45,040
Speaker 13: that one of the numbers that frightened me today came

775
00:42:45,080 --> 00:42:50,280
Speaker 13: in the Energy Information Report and it showed gasoline imports

776
00:42:50,320 --> 00:42:52,640
Speaker 13: on the East Coast of less than one hundred thousand

777
00:42:52,719 --> 00:42:56,239
Speaker 13: barrels a day. That number probably doesn't resonate with a

778
00:42:56,239 --> 00:43:00,480
Speaker 13: lot of people, but it's about twenty percent of what

779
00:43:00,520 --> 00:43:03,640
Speaker 13: we're used to. And the East Coast, which is of

780
00:43:03,680 --> 00:43:08,640
Speaker 13: course houses the CME contract for our Bob futures, is

781
00:43:08,680 --> 00:43:11,320
Speaker 13: a market that we have to watch very very closely.

782
00:43:11,880 --> 00:43:14,719
Speaker 13: If we're not going to get European or foreign gasoline

783
00:43:14,760 --> 00:43:18,880
Speaker 13: into the Northeast, we could see tighter supply here and

784
00:43:18,960 --> 00:43:21,880
Speaker 13: that could really lead to higher prices throughout the continent.

785
00:43:23,080 --> 00:43:23,360
Speaker 7: Man.

786
00:43:24,280 --> 00:43:26,239
Speaker 3: Well, but then we get into the question as to

787
00:43:26,280 --> 00:43:28,279
Speaker 3: whether or not, at some point if higher prices are

788
00:43:28,320 --> 00:43:30,640
Speaker 3: going to be the cure for higher prices tom at

789
00:43:30,640 --> 00:43:34,040
Speaker 3: what levels do you expect material demand destruction to kick in?

790
00:43:35,320 --> 00:43:38,680
Speaker 13: Somewhere between four and five we're at the Ted Williams number.

791
00:43:38,719 --> 00:43:41,319
Speaker 13: Now four oh six. That's a dated reference, but I'm

792
00:43:41,360 --> 00:43:44,800
Speaker 13: an old guy. I think somewhere between four point fifty

793
00:43:44,880 --> 00:43:47,279
Speaker 13: and four ninety five or whatever you do get into

794
00:43:47,360 --> 00:43:51,040
Speaker 13: demand destruction. Now, one thing's going to help offset some

795
00:43:51,120 --> 00:43:54,000
Speaker 13: of the gasoline demand destruction, and that's the price of

796
00:43:54,080 --> 00:43:57,560
Speaker 13: jet fuel. The high fares and the nonsense that you

797
00:43:57,640 --> 00:44:00,040
Speaker 13: have to go through when you go to airports. You

798
00:44:00,080 --> 00:44:01,960
Speaker 13: could make a strong case that there might be a

799
00:44:01,960 --> 00:44:05,000
Speaker 13: little bit more on the road travel this year, then

800
00:44:05,040 --> 00:44:07,520
Speaker 13: there will be in the airways. I don't know about you,

801
00:44:07,560 --> 00:44:09,640
Speaker 13: but I'm not looking forward to the next time I

802
00:44:09,680 --> 00:44:12,120
Speaker 13: go to an airport, even though I booked it and

803
00:44:12,239 --> 00:44:14,200
Speaker 13: got the fairies a month or so ago.

804
00:44:15,440 --> 00:44:17,200
Speaker 3: I'm supposed to go to the airport with a seven

805
00:44:17,200 --> 00:44:18,200
Speaker 3: month old baby tomorrow.

806
00:44:18,480 --> 00:44:19,279
Speaker 1: I cannot.

807
00:44:20,560 --> 00:44:21,520
Speaker 7: This is going to be fine.

808
00:44:21,560 --> 00:44:23,320
Speaker 8: I just know he's going to be a great traveler

809
00:44:23,360 --> 00:44:26,040
Speaker 8: tom When you think about all of the derivatives, though,

810
00:44:26,080 --> 00:44:27,920
Speaker 8: which one do you worry about the most? Is it

811
00:44:27,960 --> 00:44:31,600
Speaker 8: the doubling in jet fuel? Is a gasoline at four dollars?

812
00:44:31,760 --> 00:44:34,080
Speaker 8: Or should I be asking you about diesel or something else?

813
00:44:34,840 --> 00:44:34,960
Speaker 6: Now?

814
00:44:35,080 --> 00:44:37,319
Speaker 13: I think jet fuel is going to be okay, And

815
00:44:37,400 --> 00:44:39,520
Speaker 13: I think, you know, one of the big helps there

816
00:44:39,600 --> 00:44:42,719
Speaker 13: is that we've got this huge new refinery in Nigeria

817
00:44:42,760 --> 00:44:46,239
Speaker 13: that probably can't make gasoline for North America that could

818
00:44:46,280 --> 00:44:48,719
Speaker 13: make a lot of jet fuel. The typical refinery might

819
00:44:48,760 --> 00:44:52,200
Speaker 13: make nine percent of its yield on the jet fuel side,

820
00:44:52,239 --> 00:44:54,759
Speaker 13: So I think that'll correct. It's just that that was

821
00:44:54,800 --> 00:44:58,120
Speaker 13: a product that was so low in storage. We don't

822
00:44:58,160 --> 00:45:01,360
Speaker 13: store jet fuel a lot. You store gas oil and

823
00:45:01,480 --> 00:45:04,560
Speaker 13: heating oil and diesel, and to a certain extent, you

824
00:45:04,600 --> 00:45:08,200
Speaker 13: store gasoline. Although you have the problem of the winter,

825
00:45:08,280 --> 00:45:11,360
Speaker 13: gasoline is inappropriate for use in the spring and summer.

826
00:45:11,680 --> 00:45:13,200
Speaker 13: And by the way, you're going to see that in

827
00:45:13,239 --> 00:45:16,360
Speaker 13: the Northeast. If you think that prices in the Northeast

828
00:45:16,400 --> 00:45:18,640
Speaker 13: are moving up a little bit higher than normal.

829
00:45:18,400 --> 00:45:19,520
Speaker 7: That's because they are.

830
00:45:19,920 --> 00:45:22,759
Speaker 13: And it's because we're switching from the winter blend, where

831
00:45:22,760 --> 00:45:25,840
Speaker 13: you have a lot of cheap components, into the summer blend,

832
00:45:25,880 --> 00:45:26,520
Speaker 13: where you don't.

833
00:45:28,360 --> 00:45:31,000
Speaker 3: Tom we have just about a minute left here, just quickly.

834
00:45:31,160 --> 00:45:33,840
Speaker 3: If for whatever reason, the US isn't able to secure

835
00:45:33,840 --> 00:45:35,840
Speaker 3: the reopening of the Straight of hormones, if Iran is

836
00:45:35,840 --> 00:45:38,880
Speaker 3: successful in implementing fees to transit the strait of some

837
00:45:39,000 --> 00:45:42,080
Speaker 3: two million dollars, how would that translate into the actual

838
00:45:42,120 --> 00:45:44,320
Speaker 3: price of the product on those vessels.

839
00:45:45,640 --> 00:45:46,600
Speaker 7: I think that if we have.

840
00:45:46,600 --> 00:45:49,680
Speaker 13: An impeded straight or promos in the month of April,

841
00:45:49,840 --> 00:45:52,320
Speaker 13: we are looking at one hundred and thirty, one hundred

842
00:45:52,320 --> 00:45:55,400
Speaker 13: and forty and then all sorts of numbers. There is

843
00:45:55,520 --> 00:45:58,960
Speaker 13: some symmetry in the market that indicates a possibility of

844
00:45:59,000 --> 00:46:01,880
Speaker 13: going as high is two hundred to two hundred and forty.

845
00:46:03,000 --> 00:46:05,360
Speaker 13: How they're going to implement that, I don't know. Do

846
00:46:05,480 --> 00:46:08,160
Speaker 13: they have an easy pass in the Persian Gulf. Maybe

847
00:46:08,200 --> 00:46:11,359
Speaker 13: they can do something like that, but it's likely to

848
00:46:11,360 --> 00:46:15,200
Speaker 13: be wrought with corruption and problems or whatever, so we

849
00:46:15,360 --> 00:46:18,440
Speaker 13: really need Straight to be reopened. I don't agree that

850
00:46:18,560 --> 00:46:21,560
Speaker 13: often with Mike Summers from API, but I agree with

851
00:46:21,640 --> 00:46:22,440
Speaker 13: him on Yeah.

852
00:46:23,760 --> 00:46:24,680
Speaker 7: That says a lot.

853
00:46:24,920 --> 00:46:26,960
Speaker 8: From Tom close that we learn a lot every time

854
00:46:27,000 --> 00:46:28,839
Speaker 8: we talk to Tom, and we thank you so much

855
00:46:30,920 --> 00:46:34,120
Speaker 8: thanks for listening to the Balance of Power podcast. Make

856
00:46:34,160 --> 00:46:37,120
Speaker 8: sure to subscribe if you haven't already, at Apple, Spotify,

857
00:46:37,200 --> 00:46:39,799
Speaker 8: or wherever you get your podcasts, and you can find

858
00:46:39,840 --> 00:46:42,640
Speaker 8: us live every weekday from Washington, DC at New Time

859
00:46:42,719 --> 00:46:44,840
Speaker 8: Eastern at Bloomberg dot com.