1 00:00:00,080 --> 00:00:02,840 Speaker 1: We bring you news and analysis every day on the 2 00:00:02,880 --> 00:00:06,840 Speaker 1: Bloomberg Surveillance Podcast. But now you can get the latest 3 00:00:06,880 --> 00:00:11,639 Speaker 1: news on demand whenever you want. Subscribe to Bloomberg News 4 00:00:11,640 --> 00:00:14,400 Speaker 1: Now to get the latest headlines at the click of 5 00:00:14,440 --> 00:00:18,880 Speaker 1: a button. Get informed on your schedule. You can listen 6 00:00:18,960 --> 00:00:22,720 Speaker 1: and subscribe to Bloomberg News Now on the Bloomberg Business App, 7 00:00:22,760 --> 00:00:27,720 Speaker 1: Bloomberg dot Com plus Apple, Spotify, and anywhere else you 8 00:00:27,800 --> 00:00:37,360 Speaker 1: get your podcasts. Search Bloomberg News Now and subscribe today. 9 00:00:37,760 --> 00:00:41,120 Speaker 1: This is the Bloomberg Surveillance Podcast. I'm Tom Keene, along 10 00:00:41,120 --> 00:00:44,960 Speaker 1: with Jonathan Farrow and Lisa Abramowitz. Join us each day 11 00:00:45,000 --> 00:00:49,480 Speaker 1: for insight from the best and economics, geopolitics, finance and investment. 12 00:00:49,920 --> 00:00:54,720 Speaker 1: Subscribe to Bloomberg Surveillance on demand on Apple, Spotify and 13 00:00:54,920 --> 00:00:59,240 Speaker 1: anywhere you get your podcasts, and always on Bloomberg dot Com, 14 00:00:59,280 --> 00:01:02,960 Speaker 1: the Bloomberg Crimenal and the Bloomberg Business opp This is 15 00:01:02,960 --> 00:01:08,760 Speaker 1: an important conversation. Why the duration Ron Dermer is Israeli 16 00:01:08,840 --> 00:01:12,720 Speaker 1: Minister of Strategic Affairs, but far more he was Ambassador 17 00:01:12,800 --> 00:01:17,120 Speaker 1: of Israel to the United States for seven years. His 18 00:01:17,280 --> 00:01:22,000 Speaker 1: extended period in Washington, his work at Wharton, among others, 19 00:01:22,120 --> 00:01:25,040 Speaker 1: is noted and to have Ambassador Deurhmer with us, John, 20 00:01:25,120 --> 00:01:29,440 Speaker 1: with his experience across all of a decade is important. 21 00:01:29,600 --> 00:01:32,039 Speaker 2: Minister, thank you for being with us this morning, and 22 00:01:32,080 --> 00:01:34,080 Speaker 2: I think first and foremost we have to extend on 23 00:01:34,160 --> 00:01:38,160 Speaker 2: deepest sympathies to you and the people of Israel. Our 24 00:01:38,200 --> 00:01:40,880 Speaker 2: first thoughts going to the hostages, the scores of hostages 25 00:01:40,880 --> 00:01:43,240 Speaker 2: that were taken over the weekend. And as you know, 26 00:01:43,280 --> 00:01:45,480 Speaker 2: there are some reports at the moment in the media 27 00:01:45,520 --> 00:01:47,680 Speaker 2: that we'd love to get an on the record response 28 00:01:47,720 --> 00:01:50,200 Speaker 2: from you on this from Reuter's a little bit earlier 29 00:01:50,200 --> 00:01:53,240 Speaker 2: this morning that Katari mediators of how talks with Hamas 30 00:01:53,240 --> 00:01:56,320 Speaker 2: officials to try to negotiate the release of Israeli women 31 00:01:56,320 --> 00:02:00,000 Speaker 2: and children hold in Gaza. Minister, are their active talks 32 00:02:00,000 --> 00:02:02,480 Speaker 2: exlct my guitar to release hostages? 33 00:02:03,680 --> 00:02:05,600 Speaker 3: Well, what I guess you just read to me is 34 00:02:05,600 --> 00:02:09,160 Speaker 3: that Kataris were talking to Hamas about it. Israel has 35 00:02:09,200 --> 00:02:10,560 Speaker 3: not been negotiating with anybody. 36 00:02:10,760 --> 00:02:13,639 Speaker 2: Has Katar spoken to you about the release of hostages 37 00:02:13,680 --> 00:02:15,840 Speaker 2: and their role they might play as a mediator? 38 00:02:16,520 --> 00:02:19,440 Speaker 3: As I said, what the qataris speaking to Hamas and 39 00:02:19,480 --> 00:02:22,959 Speaker 3: talking about different things. Look, people are outraged by what happened. 40 00:02:22,960 --> 00:02:26,840 Speaker 3: I'm sure your outrage. I appreciate the condolences. I know 41 00:02:26,880 --> 00:02:30,640 Speaker 3: their heartfelt, and they're deeply appreciated. We haven't seen something 42 00:02:30,720 --> 00:02:32,799 Speaker 3: like this, even in the Middle East, which is you know, 43 00:02:32,960 --> 00:02:35,800 Speaker 3: is has a lot of brutality and savagery in it. 44 00:02:35,800 --> 00:02:38,800 Speaker 3: We haven't seen savagery like this since Isis when you 45 00:02:38,840 --> 00:02:44,399 Speaker 3: have killers, scores of hundreds, really of terrorists who who 46 00:02:45,000 --> 00:02:49,799 Speaker 3: invaded Israel on Saturday morning on trucks with AK forty 47 00:02:49,840 --> 00:02:51,840 Speaker 3: sevens and just mowed down people who were at a 48 00:02:51,919 --> 00:02:58,399 Speaker 3: dance festival, went into people's homes, killed whole families, kidnapped children, women, elderly. 49 00:02:58,480 --> 00:03:01,120 Speaker 3: This thing is sick and it's savage, and you really 50 00:03:01,200 --> 00:03:04,400 Speaker 3: have a battle between the forces of civilization on the 51 00:03:04,400 --> 00:03:07,120 Speaker 3: one side and the forces of barbarism, and civilization is 52 00:03:07,440 --> 00:03:09,600 Speaker 3: going to have to win. And that's exactly what we're 53 00:03:09,600 --> 00:03:11,160 Speaker 3: going to do in the days ahead. And as you 54 00:03:11,200 --> 00:03:13,720 Speaker 3: heard from Secretary of Blincoln, it may take some time, 55 00:03:14,080 --> 00:03:16,400 Speaker 3: but we're going to exact such a high price that 56 00:03:16,480 --> 00:03:19,120 Speaker 3: not only will Hamas never consider doing this again, I 57 00:03:19,120 --> 00:03:22,200 Speaker 3: think none of Israel's enemies are going to ever think 58 00:03:22,240 --> 00:03:25,360 Speaker 3: about doing something like this again, you know, and the 59 00:03:25,400 --> 00:03:29,880 Speaker 3: feeling of euphoria on the other side israelis those of 60 00:03:29,919 --> 00:03:32,960 Speaker 3: a certain age remember nineteen seventy three when a surprise 61 00:03:33,000 --> 00:03:34,440 Speaker 3: attack was launched against us on. 62 00:03:34,400 --> 00:03:35,240 Speaker 4: Two different fronts. 63 00:03:36,080 --> 00:03:38,120 Speaker 3: There was euphoria then for a few days, but then 64 00:03:38,240 --> 00:03:40,320 Speaker 3: Israel turned the tide and the end of the war 65 00:03:40,360 --> 00:03:42,080 Speaker 3: looked very different than the beginning of the war. 66 00:03:42,120 --> 00:03:44,000 Speaker 4: And this is exactly what's going to happen. 67 00:03:43,760 --> 00:03:46,120 Speaker 2: Now, Minister Basin One, you've just told us. Can we 68 00:03:46,200 --> 00:03:50,240 Speaker 2: just assume then that a full ground invasion is inevitable. 69 00:03:51,880 --> 00:03:53,600 Speaker 3: We're going to do whatever we have to do to 70 00:03:53,680 --> 00:03:57,520 Speaker 3: send a lesson that they're going to understand for many, 71 00:03:57,520 --> 00:04:01,120 Speaker 3: many decades, not just Hamas, not just the terror organizations 72 00:04:01,120 --> 00:04:04,320 Speaker 3: in Gaza, but all the terror organizations and all the 73 00:04:04,400 --> 00:04:06,840 Speaker 3: enemies of Israel, and Iran is the biggest enemy of all, 74 00:04:06,880 --> 00:04:10,080 Speaker 3: and they're pulling the strings behind the scenes, giving money, 75 00:04:10,080 --> 00:04:13,520 Speaker 3: giving weapons, having meetings to try to coordinate attacks in Israel, 76 00:04:13,560 --> 00:04:15,800 Speaker 3: and as I speak to you, Iran is trying to 77 00:04:15,840 --> 00:04:19,760 Speaker 3: push other people into the theater of war. We're going 78 00:04:19,800 --> 00:04:22,040 Speaker 3: to have to send a message to everybody because Israel, 79 00:04:22,080 --> 00:04:23,720 Speaker 3: you know, as you know, we're a tiny country or 80 00:04:23,760 --> 00:04:27,119 Speaker 3: about the size of New Jersey, America is about forty 81 00:04:27,160 --> 00:04:29,880 Speaker 3: times the population that we have, which goes to show 82 00:04:29,920 --> 00:04:32,719 Speaker 3: you how heinous the attack was yesterday. Because when you 83 00:04:32,760 --> 00:04:36,200 Speaker 3: have maybe one thousand people in Israel who were killed 84 00:04:36,200 --> 00:04:38,520 Speaker 3: on a single day, and your population is forty times 85 00:04:38,560 --> 00:04:41,040 Speaker 3: the size, it's around forty thousand Americans. That's more than 86 00:04:41,080 --> 00:04:43,440 Speaker 3: ten nine to eleven. So you can imagine the sense 87 00:04:43,480 --> 00:04:45,560 Speaker 3: of disgust that we have. We have to send a 88 00:04:45,600 --> 00:04:48,760 Speaker 3: message to all of Israel's enemies because we're a strong country, 89 00:04:48,800 --> 00:04:51,680 Speaker 3: but we're tiny, and we can go from strength to vulnerability. 90 00:04:51,920 --> 00:04:53,760 Speaker 3: I think people are going to see the strength of Israel, 91 00:04:53,800 --> 00:04:56,920 Speaker 3: the might of Israel, and I hope that the wal 92 00:04:57,000 --> 00:05:00,360 Speaker 3: to Wall support that we appreciate that we had day 93 00:05:00,920 --> 00:05:03,840 Speaker 3: from the President Biden, the support on both sides of 94 00:05:03,839 --> 00:05:06,680 Speaker 3: the island Washington. I hope in the days ahead that 95 00:05:06,680 --> 00:05:09,600 Speaker 3: that support continues when Israel has to do what it 96 00:05:09,680 --> 00:05:12,080 Speaker 3: has to do in order to exact such a heavy 97 00:05:12,080 --> 00:05:14,640 Speaker 3: price from this terror organization that not only do they 98 00:05:14,680 --> 00:05:18,279 Speaker 3: not threadn us, that they don't threaten any civilized country 99 00:05:18,320 --> 00:05:20,880 Speaker 3: around the world. Believe me, this will inspire terrorists the 100 00:05:20,880 --> 00:05:23,720 Speaker 3: world over. Just like you had the Isis caliphate. It 101 00:05:23,839 --> 00:05:27,039 Speaker 3: started to do inspiring people all around the globe. The 102 00:05:27,040 --> 00:05:29,839 Speaker 3: world came together and understood they have to crush that caliphate. 103 00:05:30,320 --> 00:05:33,159 Speaker 3: We have a force like that right in our backyard, 104 00:05:33,160 --> 00:05:36,160 Speaker 3: not thousands of miles away, but right in our backyard, 105 00:05:36,440 --> 00:05:38,520 Speaker 3: a few meters over the borders, and we're gonna have 106 00:05:38,560 --> 00:05:41,840 Speaker 3: to crush both their capability and also their spirit. 107 00:05:41,880 --> 00:05:44,359 Speaker 4: They will rule the day two days ago. We're going 108 00:05:44,440 --> 00:05:45,360 Speaker 4: to remember that day. 109 00:05:45,800 --> 00:05:48,000 Speaker 3: Israel will always remember that day, but all the terror 110 00:05:48,080 --> 00:05:51,039 Speaker 3: organizations around us are going to remember this period for 111 00:05:51,080 --> 00:05:55,159 Speaker 3: a very long time. And the critical miscalculation the Kamas 112 00:05:55,240 --> 00:05:57,560 Speaker 3: may thinking that it was going to be business as 113 00:05:57,640 --> 00:06:00,160 Speaker 3: usual in Israel. Believe me, it is not. The people 114 00:06:00,160 --> 00:06:03,640 Speaker 3: are outrage and they have awoken not a sleeping giant, 115 00:06:03,640 --> 00:06:05,719 Speaker 3: but a sleeping maccabee, and they're going to see it 116 00:06:05,720 --> 00:06:07,040 Speaker 3: in the days and weeks ahead. 117 00:06:07,400 --> 00:06:11,000 Speaker 2: Minister, you mentioned Iran. Have you seen personally or are 118 00:06:11,000 --> 00:06:14,839 Speaker 2: you aware of any evidence that Iran was directly responsible 119 00:06:14,839 --> 00:06:17,920 Speaker 2: and help coordinate these attacks over the weekend. 120 00:06:18,720 --> 00:06:20,640 Speaker 3: Well, let me tell you what we do know for sure, 121 00:06:21,560 --> 00:06:24,600 Speaker 3: But we know for sure that Iran provides ninety the 122 00:06:24,680 --> 00:06:27,400 Speaker 3: last numbers. I saw ninety three percent of the military 123 00:06:27,440 --> 00:06:32,640 Speaker 3: budget of Hamas is provided for by Iran. They are 124 00:06:32,720 --> 00:06:35,920 Speaker 3: trying and have worked to put weapons not in justin 125 00:06:36,000 --> 00:06:38,680 Speaker 3: to Gaza, but also in Judas, Samaria, the West Bank. 126 00:06:39,279 --> 00:06:41,920 Speaker 3: They also support hasbalas you know, on our northern border. 127 00:06:41,960 --> 00:06:43,279 Speaker 4: We know that as a fact. 128 00:06:43,480 --> 00:06:46,560 Speaker 3: We know that Iran has coordinated meetings with all of 129 00:06:46,560 --> 00:06:49,160 Speaker 3: its terrorist proxies in the region, Hamas and Gaza and 130 00:06:49,240 --> 00:06:54,159 Speaker 3: another terror organization Palesiti in Islamic Jihad in Gaza and Hezbala, 131 00:06:54,240 --> 00:06:57,240 Speaker 3: almost to kind of joint operations, I don't want to 132 00:06:57,240 --> 00:07:00,200 Speaker 3: say joint operation center, but coordinated meetings. It was one 133 00:07:00,360 --> 00:07:03,120 Speaker 3: question that I'm sure you're interested in. Did they know 134 00:07:03,320 --> 00:07:07,560 Speaker 3: about this beforehand? Initially we didn't think that they did. 135 00:07:07,640 --> 00:07:09,760 Speaker 3: Now there is some evidence that they might have known 136 00:07:09,880 --> 00:07:12,720 Speaker 3: about it, or we are working to verify that evidence. 137 00:07:12,760 --> 00:07:16,040 Speaker 3: That's why maybe there's some conflicting reports in the press 138 00:07:16,080 --> 00:07:18,720 Speaker 3: that we don't exactly know. But now that we're looking 139 00:07:18,800 --> 00:07:20,680 Speaker 3: back and we're looking at all of our intel and 140 00:07:20,720 --> 00:07:23,640 Speaker 3: seeing exactly what the situation is, it's still not clear 141 00:07:23,640 --> 00:07:23,920 Speaker 3: to us. 142 00:07:23,920 --> 00:07:25,280 Speaker 4: But they might have done it. But I have to 143 00:07:25,280 --> 00:07:25,920 Speaker 4: tell you they. 144 00:07:25,760 --> 00:07:30,200 Speaker 3: Are working right now to bring more and more terror 145 00:07:30,240 --> 00:07:32,600 Speaker 3: groups into this fight. So everyone has to know it, 146 00:07:32,600 --> 00:07:35,360 Speaker 3: and it's important not just I think, to stand unequivocally 147 00:07:35,360 --> 00:07:38,600 Speaker 3: with Israel against Kamas, to call for freeing the hostages, 148 00:07:38,840 --> 00:07:41,440 Speaker 3: but also to stand unequivocally against Iran. 149 00:07:41,760 --> 00:07:42,680 Speaker 4: You know there's going to be. 150 00:07:45,080 --> 00:07:51,720 Speaker 3: The UN Security Council can tomorrow, Europe, France, Britain, Germany, 151 00:07:51,760 --> 00:07:54,040 Speaker 3: they can work to snap bang the UN sanctions, the 152 00:07:54,080 --> 00:07:57,800 Speaker 3: Security Council sanctions against Iran. You have to enforce oil 153 00:07:57,880 --> 00:08:01,520 Speaker 3: sanctions against Iran. Sporting a lot of oil, They're getting 154 00:08:01,520 --> 00:08:04,000 Speaker 3: a lot of money, tens of billions of dollars. It's 155 00:08:04,040 --> 00:08:06,800 Speaker 3: time that the world unites against Iran because what you're 156 00:08:06,840 --> 00:08:10,080 Speaker 3: seeing today is a tentacle of an Iranian octopus, and 157 00:08:10,120 --> 00:08:12,280 Speaker 3: we have to not only cut off the tentacle, we 158 00:08:12,360 --> 00:08:14,960 Speaker 3: have to deal with the regime that is sending them. 159 00:08:15,880 --> 00:08:17,640 Speaker 3: And I hope that the world will stand with Israel, 160 00:08:17,680 --> 00:08:19,440 Speaker 3: as I said in the days and weeks ahead, to 161 00:08:19,800 --> 00:08:23,360 Speaker 3: reverse this and turn it into a victory against terrorism. 162 00:08:23,440 --> 00:08:26,680 Speaker 2: And Barbers, Minister, we have some news to work through 163 00:08:26,880 --> 00:08:29,080 Speaker 2: on our side, and I'd love to continue this conversation 164 00:08:29,160 --> 00:08:31,720 Speaker 2: with you. At the same time, according to the CBS 165 00:08:31,800 --> 00:08:34,480 Speaker 2: White House reporter or at least nine Americans were killed 166 00:08:34,840 --> 00:08:37,320 Speaker 2: in Israel. As I'm sure you know, this goes beyond 167 00:08:37,320 --> 00:08:40,000 Speaker 2: the people of Israel. The whole world is looking at 168 00:08:40,000 --> 00:08:43,120 Speaker 2: this moment. Just on Iran, you mentioned that you may 169 00:08:43,200 --> 00:08:47,800 Speaker 2: have some evidence that implicates Iran directly for the operations 170 00:08:48,280 --> 00:08:50,400 Speaker 2: that took place over the weekend. Could you share with 171 00:08:50,480 --> 00:08:52,280 Speaker 2: us the nature of that evidence? 172 00:08:53,240 --> 00:08:54,559 Speaker 4: Unfortunately I can't. 173 00:08:55,280 --> 00:08:57,839 Speaker 3: If I could, I would, but I can't, and we're 174 00:08:57,880 --> 00:09:00,040 Speaker 3: going to have to look through it now. Our working 175 00:09:00,080 --> 00:09:03,040 Speaker 3: assumption is that they may have. Our working assumption a 176 00:09:03,040 --> 00:09:05,640 Speaker 3: couple of days ago was that they hadn't known about 177 00:09:05,640 --> 00:09:08,160 Speaker 3: it directly. Now it is unclear, and we'll have to 178 00:09:08,160 --> 00:09:09,960 Speaker 3: wait to verify it. And you know, when we make 179 00:09:10,000 --> 00:09:12,320 Speaker 3: an official statement, we'll make an official statement, but we 180 00:09:12,400 --> 00:09:15,440 Speaker 3: have to work some work through that right now, because 181 00:09:15,440 --> 00:09:16,880 Speaker 3: I want to make sure that when I say it, 182 00:09:17,040 --> 00:09:18,680 Speaker 3: we know with one hundred percent certainty. 183 00:09:18,760 --> 00:09:20,040 Speaker 4: Now that is our working assumption. 184 00:09:20,240 --> 00:09:22,480 Speaker 2: We did hear this from the Wall Street Journal that 185 00:09:22,480 --> 00:09:25,360 Speaker 2: Iranian security officials helped plan Hamas's attacks and gave a 186 00:09:25,400 --> 00:09:27,640 Speaker 2: green light for the assault at a meeting at Beirroute 187 00:09:27,679 --> 00:09:32,280 Speaker 2: last Monday. According to Cedia members of Hamas and Hesbala. 188 00:09:32,280 --> 00:09:35,400 Speaker 2: Are you aware of a meeting that took place in 189 00:09:35,440 --> 00:09:39,559 Speaker 2: the last week between Iran and leadership of Hamas and Hespala. 190 00:09:39,720 --> 00:09:42,360 Speaker 3: They have meetings all the time, it's not secret. You 191 00:09:42,360 --> 00:09:46,120 Speaker 3: can see pictures of their meeting with Iran leadership, the 192 00:09:46,200 --> 00:09:51,920 Speaker 3: leadership of their Iranian Revolutionary Guard leadership, their CUDS Force leadership, 193 00:09:51,960 --> 00:09:55,000 Speaker 3: meeting with these other senior officials. So they've had many, many, 194 00:09:55,040 --> 00:09:57,640 Speaker 3: many meetings over the last few months, and they worked 195 00:09:57,720 --> 00:09:58,080 Speaker 3: very hard. 196 00:09:58,120 --> 00:09:59,240 Speaker 4: What is Iran trying to do? 197 00:09:59,360 --> 00:10:01,760 Speaker 3: Those of you, those are your viewers who know the 198 00:10:01,760 --> 00:10:04,120 Speaker 3: map of the Middle East, know that Iran supports the 199 00:10:04,120 --> 00:10:09,120 Speaker 3: Shield militias any rock. They are trying to establish a beachhead, 200 00:10:09,160 --> 00:10:12,680 Speaker 3: a terrorists beachhead against Israel and Syria. They support Hezballah 201 00:10:13,120 --> 00:10:15,679 Speaker 3: in Lebanon, which is the northern part of Israel. They 202 00:10:15,679 --> 00:10:18,680 Speaker 3: support both Palistin and Islami Chihad and Hamas and Gaza. 203 00:10:18,960 --> 00:10:20,559 Speaker 4: They support the Hutis in Yemen. 204 00:10:20,600 --> 00:10:22,200 Speaker 3: And what they're trying to do is put a noose 205 00:10:22,520 --> 00:10:25,360 Speaker 3: around Israel's neck with all of those terror groups there, 206 00:10:26,280 --> 00:10:28,360 Speaker 3: and we have to make sure that we break out 207 00:10:28,400 --> 00:10:31,040 Speaker 3: of that noose. And deliver such a mighty blow that 208 00:10:31,080 --> 00:10:32,760 Speaker 3: they're not going to forget it for generations. 209 00:10:32,840 --> 00:10:35,240 Speaker 1: Ambassador, I want to take your years of experience here, 210 00:10:35,240 --> 00:10:37,760 Speaker 1: and it's outside your remit, but I'm sure it's something 211 00:10:37,800 --> 00:10:41,319 Speaker 1: everyone wants to know. I can't get my head around 212 00:10:41,360 --> 00:10:47,920 Speaker 1: how Israel invades the Gaza Strip. Do you anticipate substantial 213 00:10:48,120 --> 00:10:52,080 Speaker 1: bombing and air attack or are we ready for some 214 00:10:52,200 --> 00:10:57,840 Speaker 1: definitive original building to building urban warfare in Gaza. 215 00:11:00,000 --> 00:11:01,920 Speaker 3: Because I'm a member of the Security Cabinet, I'm not 216 00:11:01,920 --> 00:11:04,680 Speaker 3: going to discuss that. Let's just say we have a 217 00:11:04,720 --> 00:11:08,280 Speaker 3: clear goal to cripple the capabilities of Kamas and also 218 00:11:08,360 --> 00:11:10,240 Speaker 3: their will to wage war against us. 219 00:11:10,240 --> 00:11:11,720 Speaker 4: So you're going to have to interpret that the way 220 00:11:11,760 --> 00:11:13,080 Speaker 4: you want it. I have to leave it at that. 221 00:11:13,679 --> 00:11:16,800 Speaker 3: But it's people who doubt Israel's capabilities are making a 222 00:11:16,880 --> 00:11:20,200 Speaker 3: huge mistake. We will do what we have to do 223 00:11:20,280 --> 00:11:22,680 Speaker 3: in order to achieve that goal, and we are going 224 00:11:22,720 --> 00:11:25,720 Speaker 3: to have to achieve this goal obviously first and foremost 225 00:11:25,760 --> 00:11:27,920 Speaker 3: for Israel, but it's for all of our Arab partners 226 00:11:28,200 --> 00:11:28,800 Speaker 3: in the region. 227 00:11:29,200 --> 00:11:29,760 Speaker 4: Believe me. 228 00:11:30,000 --> 00:11:32,160 Speaker 3: Put aside all of those statements that are made by 229 00:11:32,160 --> 00:11:34,559 Speaker 3: foreign ministries in the region, and some of you may 230 00:11:34,559 --> 00:11:37,040 Speaker 3: have conversations with officials from the Middle East and they 231 00:11:37,040 --> 00:11:39,600 Speaker 3: may tell you a very different story about Israel than 232 00:11:39,600 --> 00:11:43,080 Speaker 3: they may be saying publicly. There have been times in 233 00:11:43,080 --> 00:11:45,640 Speaker 3: the past where Israel has fought with these terror organizations, 234 00:11:45,679 --> 00:11:48,000 Speaker 3: and the ones who are rooting for us usually first 235 00:11:48,000 --> 00:11:51,439 Speaker 3: and foremost are these Arab states were threatened right by 236 00:11:51,480 --> 00:11:55,599 Speaker 3: these jihadi forces, whether it's a Shia Jiadi force or 237 00:11:55,600 --> 00:11:58,560 Speaker 3: a Shia group like Iran and its proxies, or Sunni 238 00:11:58,559 --> 00:12:01,760 Speaker 3: group like Kamas. They don't want these forces of barbarism 239 00:12:01,800 --> 00:12:04,480 Speaker 3: to win because they threaten them, Ambassador, and this is 240 00:12:04,600 --> 00:12:08,360 Speaker 3: very just one thing, if I may, this is also 241 00:12:08,559 --> 00:12:11,680 Speaker 3: very important for the pursuit of peace eventually, because no 242 00:12:11,679 --> 00:12:13,840 Speaker 3: one is going to make peace with the week. We 243 00:12:13,920 --> 00:12:15,960 Speaker 3: have to be very strong, and it's strength that is 244 00:12:15,960 --> 00:12:18,560 Speaker 3: actually going to improve our chances to reach an historic 245 00:12:18,559 --> 00:12:20,680 Speaker 3: piece agreement with Saudi Arabia, which I have no doubt 246 00:12:20,760 --> 00:12:23,120 Speaker 3: is one of the reasons why this action was taken 247 00:12:23,160 --> 00:12:23,520 Speaker 3: at this. 248 00:12:23,480 --> 00:12:27,880 Speaker 1: Time for our audience, Ambassador Dermer, can you triangulate the 249 00:12:27,920 --> 00:12:32,240 Speaker 1: focus obviously on Gaza, but also now on the West 250 00:12:32,280 --> 00:12:36,360 Speaker 1: Bank in a fractious northern border with Lebanon. How will 251 00:12:36,520 --> 00:12:40,360 Speaker 1: Israel affect a three front war. 252 00:12:42,240 --> 00:12:45,800 Speaker 3: Well, we have to ensure that our force structure is 253 00:12:45,840 --> 00:12:47,520 Speaker 3: done in a certain way that we can deal with 254 00:12:47,559 --> 00:12:50,559 Speaker 3: any threats that would materialize. And you say, quite rightly, 255 00:12:50,600 --> 00:12:53,400 Speaker 3: we have issues on the northern border. We had sirens 256 00:12:53,400 --> 00:12:55,800 Speaker 3: there just about an hour ago, we had an attack 257 00:12:55,840 --> 00:12:58,760 Speaker 3: there yesterday. There are different attempts for attacks, so we 258 00:12:58,840 --> 00:13:01,240 Speaker 3: have to be clear on a northern border that we 259 00:13:01,360 --> 00:13:04,600 Speaker 3: have all the capabilities we need to defend ourselves. As 260 00:13:04,640 --> 00:13:07,520 Speaker 3: you know, the United States brought a carrier group into 261 00:13:07,559 --> 00:13:10,079 Speaker 3: the eastern Mediterranean. I think that sends a very strong 262 00:13:10,120 --> 00:13:12,680 Speaker 3: message to DeTar our enemies and it makes it clear 263 00:13:13,000 --> 00:13:15,920 Speaker 3: that America backs Israel. And again we're deeply appreciative of 264 00:13:15,960 --> 00:13:18,480 Speaker 3: a Bide administration for doing that. I think it makes 265 00:13:18,520 --> 00:13:21,240 Speaker 3: the chances of war less likely, not more likely. And 266 00:13:21,320 --> 00:13:22,959 Speaker 3: of course, as you said, in the West Bank, in 267 00:13:23,000 --> 00:13:26,440 Speaker 3: Judaan and Samaria, we've had terror actions that have happened there, 268 00:13:26,480 --> 00:13:27,560 Speaker 3: and we have an iro on that. 269 00:13:27,720 --> 00:13:28,920 Speaker 4: We have to have our eye on. 270 00:13:29,320 --> 00:13:32,200 Speaker 3: A sort of a three hundred and sixty radius in 271 00:13:32,320 --> 00:13:34,520 Speaker 3: order to deal with all these different challenges. But I'll 272 00:13:34,520 --> 00:13:37,240 Speaker 3: tell you the chances of having a multi front row 273 00:13:37,360 --> 00:13:41,280 Speaker 3: grow when people see Israel as being vulnerable. So the 274 00:13:41,400 --> 00:13:45,200 Speaker 3: stronger and faster we act, the more it will send 275 00:13:45,200 --> 00:13:48,240 Speaker 3: a message of strength and purpose, and that message is 276 00:13:48,280 --> 00:13:52,920 Speaker 3: critical to actually ultimately de escalate the situation and prevent 277 00:13:53,000 --> 00:13:55,959 Speaker 3: these things from happening for many, many decades. This is 278 00:13:56,000 --> 00:13:58,400 Speaker 3: an attack, I want to say it again, the lights 279 00:13:58,440 --> 00:14:00,679 Speaker 3: of which has never happened in this state of Israel. 280 00:14:00,720 --> 00:14:03,560 Speaker 3: We may have lost a thousand people in a single day, 281 00:14:04,080 --> 00:14:06,319 Speaker 3: ambassament has never happened in the state of Israel. 282 00:14:06,440 --> 00:14:08,920 Speaker 5: Ambassador, there's a big question around Saudi Arabia, and that 283 00:14:09,000 --> 00:14:12,199 Speaker 5: talks about normalizing relations. I know you've been involved with those, 284 00:14:12,400 --> 00:14:15,600 Speaker 5: and it seems like those are at least iced in 285 00:14:15,679 --> 00:14:18,120 Speaker 5: the near term. Saudi Arabia put out a statement saying 286 00:14:18,280 --> 00:14:20,800 Speaker 5: that it repeated its warnings of the dangers of the 287 00:14:20,840 --> 00:14:23,360 Speaker 5: explosion of the situation as a result of the continued 288 00:14:23,400 --> 00:14:28,400 Speaker 5: occupation and deprivation of the Palestinian people of their legitimate rights. 289 00:14:28,760 --> 00:14:32,480 Speaker 5: How much do you see this as really precluding additional 290 00:14:32,520 --> 00:14:35,880 Speaker 5: discussions with Saudi Arabia and making this kind of normalization 291 00:14:36,000 --> 00:14:39,760 Speaker 5: talk not viable in the near term. 292 00:14:39,920 --> 00:14:42,520 Speaker 3: Well, a lot of people were surprised by the Abraham Accords, 293 00:14:42,560 --> 00:14:44,480 Speaker 3: you know a few years ago when no one thought 294 00:14:44,480 --> 00:14:48,440 Speaker 3: that that could possibly happen, but Israel proved itself. It's strength, frankly, 295 00:14:48,480 --> 00:14:51,760 Speaker 3: it's security strength, it's economic vitality. I think that's what 296 00:14:51,920 --> 00:14:55,600 Speaker 3: made those accords ultimately possible. I think the critical question 297 00:14:55,640 --> 00:14:57,400 Speaker 3: of whether we're going to be able to achieve this 298 00:14:57,600 --> 00:15:01,640 Speaker 3: historic piece with Saudi Arabia that that pulls pushs the 299 00:15:01,840 --> 00:15:04,680 Speaker 3: whole Arab is rarely conflicted to a completely different place 300 00:15:04,720 --> 00:15:08,160 Speaker 3: and can lead to a broader reconciliation between Muslims and 301 00:15:08,280 --> 00:15:11,480 Speaker 3: Jews as well. The critical factor will be how Israel 302 00:15:11,520 --> 00:15:14,640 Speaker 3: emerges from this fight, or do we emerge as a victor. 303 00:15:14,720 --> 00:15:19,160 Speaker 3: Because people make peace with winners, people make peace with 304 00:15:19,240 --> 00:15:21,160 Speaker 3: a strong, they do not make peace with the weak. 305 00:15:21,240 --> 00:15:22,560 Speaker 4: And that will be the critical factor. 306 00:15:22,560 --> 00:15:25,760 Speaker 3: I'm telling you, take all the statements, all the diplomatic 307 00:15:25,800 --> 00:15:28,960 Speaker 3: statements that have been made, put them aside. It's not relevant. 308 00:15:29,280 --> 00:15:31,800 Speaker 3: I think there are many Arab partners in this region 309 00:15:32,160 --> 00:15:34,480 Speaker 3: that want a different future, that are thinking about what's 310 00:15:34,480 --> 00:15:36,800 Speaker 3: going to happen in twenty thirty forty years down the 311 00:15:36,880 --> 00:15:38,480 Speaker 3: road when oil doesn't have the. 312 00:15:38,560 --> 00:15:40,840 Speaker 4: Value to their countries that it has today. 313 00:15:41,120 --> 00:15:43,680 Speaker 3: They need a partner in Israel that can help strengthen 314 00:15:43,760 --> 00:15:47,200 Speaker 3: their own national security, that could help their own national prosperity. 315 00:15:47,240 --> 00:15:48,960 Speaker 3: You saw a few weeks ago with the G twenty 316 00:15:49,840 --> 00:15:54,320 Speaker 3: when several countries, the United States, European countries, India launched 317 00:15:54,320 --> 00:15:57,160 Speaker 3: this vision of an economic. 318 00:15:56,680 --> 00:15:57,640 Speaker 4: Corridor that would go. 319 00:15:57,640 --> 00:16:03,400 Speaker 3: From India through the Arabian Peninsula into Israel and towards Europe. 320 00:16:03,400 --> 00:16:05,840 Speaker 3: I mean, that's a game changer, an economic game changer 321 00:16:05,880 --> 00:16:07,880 Speaker 3: for the region. And I think the Saudis have great 322 00:16:07,880 --> 00:16:11,080 Speaker 3: plans for building their country. And believe me, there are 323 00:16:11,120 --> 00:16:13,080 Speaker 3: a lot of people in a lot of places in 324 00:16:13,120 --> 00:16:16,160 Speaker 3: the Middle East, no matter what they say publicly or 325 00:16:16,280 --> 00:16:20,160 Speaker 3: rooting for Israel to win, and I think they're gonna 326 00:16:20,240 --> 00:16:21,400 Speaker 3: get exactly what they want. 327 00:16:21,840 --> 00:16:23,960 Speaker 2: Minister, Just to wrap things up, because I know you 328 00:16:24,000 --> 00:16:27,160 Speaker 2: have to go one final question, winning, how do you 329 00:16:27,200 --> 00:16:30,040 Speaker 2: define victory in a moment like this one? 330 00:16:32,040 --> 00:16:36,600 Speaker 3: Like I said, you have to cripple their capability and 331 00:16:36,680 --> 00:16:39,400 Speaker 3: you have to crush their will to do such an 332 00:16:39,400 --> 00:16:43,080 Speaker 3: action for decades and decades to come, not just Hamas 333 00:16:43,120 --> 00:16:47,040 Speaker 3: and palisining Islamichi Hat, but also other terror organizations in 334 00:16:47,080 --> 00:16:50,480 Speaker 3: the region. We rely as a small country on our deterrence, 335 00:16:50,880 --> 00:16:54,720 Speaker 3: but deterrence doesn't last forever. You have to exercise power 336 00:16:54,840 --> 00:16:57,440 Speaker 3: and force to always make clear to your enemies that 337 00:16:57,480 --> 00:16:58,560 Speaker 3: you're prepared to fight. 338 00:16:58,680 --> 00:17:00,440 Speaker 4: Not only do you have the capability, but you have 339 00:17:00,480 --> 00:17:01,360 Speaker 4: the will to fight. 340 00:17:01,760 --> 00:17:05,880 Speaker 3: And our enemies Camas obviously miscalculated here because if they 341 00:17:05,920 --> 00:17:09,119 Speaker 3: think that this action that they just took and murdering 342 00:17:09,200 --> 00:17:14,160 Speaker 3: a thousand Israelis and just shooting our civilians and taking 343 00:17:14,240 --> 00:17:18,040 Speaker 3: scores of people hostage and having over maybe three thousand 344 00:17:18,040 --> 00:17:19,879 Speaker 3: people who are wounded, that this is going to be 345 00:17:19,920 --> 00:17:23,119 Speaker 3: business as usual, they just have no idea who the 346 00:17:23,160 --> 00:17:25,040 Speaker 3: people of Israel are, and I think they're going to 347 00:17:25,080 --> 00:17:26,320 Speaker 3: find out in the days ahead. 348 00:17:26,560 --> 00:17:28,919 Speaker 2: Minister, We appreciate your time this morning, got a very 349 00:17:28,920 --> 00:17:31,400 Speaker 2: difficult time for your country, and hopefully we can catch 350 00:17:31,480 --> 00:17:33,840 Speaker 2: up against soon. Run term of that, the Israeli Minister 351 00:17:34,240 --> 00:17:36,160 Speaker 2: of Strategic Affairs. 352 00:17:46,240 --> 00:17:50,720 Speaker 1: We forget in seventy three that Israeli forces got within 353 00:17:51,040 --> 00:17:54,800 Speaker 1: X miles of Damascus to the north and they made 354 00:17:54,800 --> 00:17:58,639 Speaker 1: it to the Suez Canal in over the Suez Canal 355 00:17:59,119 --> 00:18:02,000 Speaker 1: in seventy That's a bit of history that I think 356 00:18:02,040 --> 00:18:05,080 Speaker 1: people really are wide on this all comes up to 357 00:18:05,119 --> 00:18:08,280 Speaker 1: the geopolitics of the region. Expert on this and a 358 00:18:08,280 --> 00:18:12,000 Speaker 1: good friend of Bloomberg's surveillance is Ellen Wald, Senior Fellow 359 00:18:12,000 --> 00:18:17,679 Speaker 1: at Atlantic Council. Her book Saudi Inc. Is Definitive on hydrocarbons. Ellen, 360 00:18:17,720 --> 00:18:21,000 Speaker 1: thank you so much for joining this morning. Really really 361 00:18:21,400 --> 00:18:22,439 Speaker 1: a timely to have. 362 00:18:22,359 --> 00:18:23,520 Speaker 3: You with us. 363 00:18:23,760 --> 00:18:26,639 Speaker 1: How does Israel get its oil? Are they in some 364 00:18:26,840 --> 00:18:29,120 Speaker 1: way oil independent? 365 00:18:30,440 --> 00:18:34,359 Speaker 6: They're not really oil independent. Israel actually does or used 366 00:18:34,359 --> 00:18:37,240 Speaker 6: to get quite a bit of oil from the kurdis 367 00:18:37,320 --> 00:18:40,359 Speaker 6: Dan region of Iraq. It was shipped out via the 368 00:18:40,520 --> 00:18:45,200 Speaker 6: Jehan pipeline from the port of Jehan in Turkey to 369 00:18:45,920 --> 00:18:49,840 Speaker 6: ports in Israel, to Haifa and to other ports. I 370 00:18:49,840 --> 00:18:53,639 Speaker 6: don't think Israel's particularly concerned about getting oil or making 371 00:18:53,640 --> 00:18:55,719 Speaker 6: sure that they have enough oil at this point. 372 00:18:56,000 --> 00:18:56,280 Speaker 2: Though. 373 00:18:56,560 --> 00:18:59,560 Speaker 6: One interesting point that has just come up is that 374 00:19:00,000 --> 00:19:03,280 Speaker 6: Israel asked Chevron to shut down the operation of the 375 00:19:03,359 --> 00:19:08,040 Speaker 6: Tamar gas field platform, which is out in the Mediterranean 376 00:19:08,160 --> 00:19:10,479 Speaker 6: in the northern part of Israel. And to me, that 377 00:19:10,560 --> 00:19:13,720 Speaker 6: says that either they think that there could potentially be 378 00:19:14,160 --> 00:19:20,480 Speaker 6: some sort of terrorist attack on that platform, which potentially 379 00:19:20,520 --> 00:19:23,880 Speaker 6: either from Iran or Hisbela, which I would say definitely 380 00:19:23,920 --> 00:19:28,400 Speaker 6: signals to me a widening of this highly regional conflict 381 00:19:28,440 --> 00:19:31,760 Speaker 6: and something that actually could be a potential threat to 382 00:19:32,480 --> 00:19:36,439 Speaker 6: oil markets, to gas markets, especially if you consider that, 383 00:19:37,040 --> 00:19:39,720 Speaker 6: like you said, the Suez Canal is not all that far. 384 00:19:40,080 --> 00:19:43,520 Speaker 1: To take it to Saudi Arabia and your expertise there. 385 00:19:44,080 --> 00:19:47,879 Speaker 1: Which part of Palestine do Saudi Arabia does the Royal 386 00:19:47,960 --> 00:19:51,119 Speaker 1: family support, That's a great question. 387 00:19:51,160 --> 00:19:55,480 Speaker 6: And they're definitely much more interested in the Palestinian authority 388 00:19:56,000 --> 00:19:59,280 Speaker 6: run parts the West Bank than they are with Hamas, 389 00:19:59,520 --> 00:20:04,040 Speaker 6: Hamas and Saudi Raba. They see Hamas as a very 390 00:20:04,280 --> 00:20:09,680 Speaker 6: destabilizing element. Especially the Saudi monarchy does not like terrorists. 391 00:20:09,760 --> 00:20:11,879 Speaker 6: Terrorists are just as much a threat to them and 392 00:20:11,920 --> 00:20:16,000 Speaker 6: to their stability as they are to other areas. So 393 00:20:16,760 --> 00:20:19,280 Speaker 6: you know, and what's interesting is that they keep pushing 394 00:20:19,320 --> 00:20:24,760 Speaker 6: for this region two state solution, regional peace agreement. They 395 00:20:24,960 --> 00:20:29,439 Speaker 6: have always said that their recognition of Israel depends upon 396 00:20:30,000 --> 00:20:33,800 Speaker 6: a regional peace deal and two state solution, which is 397 00:20:33,840 --> 00:20:35,840 Speaker 6: one of the reasons why I think it hasn't really 398 00:20:35,880 --> 00:20:39,160 Speaker 6: gone very far and haven't seen very much, because that's 399 00:20:39,200 --> 00:20:42,359 Speaker 6: not something that Israel or that the US is really 400 00:20:42,400 --> 00:20:46,480 Speaker 6: prepared to push for at this point, the question is 401 00:20:46,840 --> 00:20:50,960 Speaker 6: will they drop this in favor of getting a defense 402 00:20:51,080 --> 00:20:55,639 Speaker 6: pack from Washington as they've indicated. They haven't quite indicated that, 403 00:20:55,720 --> 00:20:58,879 Speaker 6: but they definitely have indicated that that's a top priority 404 00:20:58,880 --> 00:21:01,800 Speaker 6: for them, especially on the nuclear front, and so that 405 00:21:01,880 --> 00:21:04,439 Speaker 6: says to me that maybe they're willing to negotiate a 406 00:21:04,480 --> 00:21:06,160 Speaker 6: bit on that requirement. 407 00:21:06,600 --> 00:21:08,920 Speaker 2: Allan there was also talking into the weekend that is 408 00:21:08,960 --> 00:21:11,800 Speaker 2: part of this pact. The likelihood is that we would 409 00:21:11,800 --> 00:21:15,240 Speaker 2: get crew dounput increased into next year. And as you 410 00:21:15,240 --> 00:21:18,440 Speaker 2: look across the region, now, what would Saudi Arabia stand 411 00:21:18,440 --> 00:21:21,000 Speaker 2: on that particular point and what could this mean for 412 00:21:21,280 --> 00:21:24,720 Speaker 2: Iran production and those barrels of oil that find their 413 00:21:24,760 --> 00:21:28,400 Speaker 2: way on international markets exactly. 414 00:21:28,480 --> 00:21:32,120 Speaker 6: And Iran has been selling more oil recently, not necessarily 415 00:21:32,119 --> 00:21:35,960 Speaker 6: because they're evading sanctions anymore, because sanctions are not as 416 00:21:36,000 --> 00:21:38,520 Speaker 6: tight as they were, but simply because Iran has been 417 00:21:38,520 --> 00:21:41,120 Speaker 6: able to increase their production and so they're selling more. 418 00:21:41,400 --> 00:21:46,680 Speaker 6: With prices up across across the markets, Iran is able 419 00:21:46,760 --> 00:21:48,840 Speaker 6: to get more money for its oil even if it's 420 00:21:48,840 --> 00:21:52,000 Speaker 6: still selling it at a discount. And even though it's 421 00:21:52,040 --> 00:21:55,760 Speaker 6: got competition from from Russian oil. So if Saudi Arabia 422 00:21:55,800 --> 00:21:58,879 Speaker 6: puts out another million barrels a day than they are 423 00:21:59,000 --> 00:22:04,440 Speaker 6: right now, that would definitely threaten Iran's Iran's money making 424 00:22:04,560 --> 00:22:09,440 Speaker 6: scheme from oil because it would send prices lower. Of course, 425 00:22:09,520 --> 00:22:11,560 Speaker 6: there are lots of other things that could also send 426 00:22:11,560 --> 00:22:14,399 Speaker 6: prices lower for i Ran, so that's not the only 427 00:22:14,480 --> 00:22:17,560 Speaker 6: issue here. I think it's it's compelling that Saudi Arabia 428 00:22:17,720 --> 00:22:21,720 Speaker 6: sees that million barrels a day as a bargaining chip 429 00:22:21,880 --> 00:22:24,760 Speaker 6: with the United States. They're saying, Hey, you're going into 430 00:22:24,800 --> 00:22:28,040 Speaker 6: an election year that could be tough. We could put 431 00:22:28,040 --> 00:22:30,639 Speaker 6: a million barrels a day back on the market and 432 00:22:30,720 --> 00:22:33,280 Speaker 6: lower oil prices for you if you help us out, 433 00:22:33,320 --> 00:22:36,679 Speaker 6: if you get us this defense pack before you know, 434 00:22:36,800 --> 00:22:40,239 Speaker 6: election season, before a new a new administration comes in 435 00:22:40,240 --> 00:22:42,440 Speaker 6: and we have to start all over. So I think 436 00:22:42,480 --> 00:22:46,439 Speaker 6: that's a very compelling chip that Saudi Arabia has thrown 437 00:22:46,640 --> 00:22:48,240 Speaker 6: into the game here. 438 00:22:48,760 --> 00:22:51,280 Speaker 5: You've talked about Uron selling more oil and it comes 439 00:22:51,320 --> 00:22:53,639 Speaker 5: at a time or there's talk of the potential for 440 00:22:53,720 --> 00:22:57,080 Speaker 5: sanctions or additional punitive measures if Euron is deemed to 441 00:22:57,119 --> 00:22:59,639 Speaker 5: have a more active role in the planning and the 442 00:22:59,680 --> 00:23:03,760 Speaker 5: execution of this attack. From your vantage point, how realistic 443 00:23:03,840 --> 00:23:06,040 Speaker 5: is that. What kind of influence could that have not 444 00:23:06,080 --> 00:23:08,919 Speaker 5: only the price of crude, but just in general to 445 00:23:09,000 --> 00:23:10,680 Speaker 5: the region and the geopolitics there. 446 00:23:11,480 --> 00:23:13,640 Speaker 6: That's a really good point. I think that any kind 447 00:23:13,640 --> 00:23:17,280 Speaker 6: of tightening of sanctions is not really going. 448 00:23:17,280 --> 00:23:18,720 Speaker 4: To have much of an impact. 449 00:23:18,800 --> 00:23:24,280 Speaker 6: It's purely, you know, something that is purely just hyperbole 450 00:23:24,480 --> 00:23:29,760 Speaker 6: and rhetoric, because enforcing sanctions is a multi year long process. Now, 451 00:23:29,840 --> 00:23:32,560 Speaker 6: if we were hearing talk of, say a blockade against 452 00:23:32,600 --> 00:23:36,000 Speaker 6: Iranian ships leaving the Persian Gulf, that would be a 453 00:23:36,040 --> 00:23:38,920 Speaker 6: totally different story. So if the United States is willing 454 00:23:38,960 --> 00:23:42,320 Speaker 6: to take its navy and ensure that Iranian ships can't 455 00:23:42,320 --> 00:23:44,840 Speaker 6: get out of the Persian Gulf to sell their oil, 456 00:23:45,280 --> 00:23:48,880 Speaker 6: or that ships that have transferred Iranian oil to them 457 00:23:48,920 --> 00:23:52,000 Speaker 6: and not maybe Iranian ships can't get out, that would 458 00:23:52,040 --> 00:23:56,120 Speaker 6: be a huge shift away from the current policy, which 459 00:23:56,160 --> 00:24:00,720 Speaker 6: is just let's try to enforce sanctions. It takes you know, three, four, 460 00:24:00,920 --> 00:24:04,320 Speaker 6: five years to do that, and that could definitely cause 461 00:24:04,359 --> 00:24:07,920 Speaker 6: a major spreading of the geopolitical conflict. I would say 462 00:24:07,920 --> 00:24:10,040 Speaker 6: if that happens, oil prices would go through the roof. 463 00:24:10,240 --> 00:24:12,000 Speaker 5: But Ellen, can you just say on a broader level, then, 464 00:24:12,000 --> 00:24:14,800 Speaker 5: do you think that any kind of interruption or disruption 465 00:24:14,960 --> 00:24:17,840 Speaker 5: to oil production has been overstated and particularly in the 466 00:24:17,840 --> 00:24:20,360 Speaker 5: price of oil this morning, or do you think that 467 00:24:20,400 --> 00:24:24,080 Speaker 5: there is a broader implication as this goes on that 468 00:24:24,119 --> 00:24:24,880 Speaker 5: you are watching. 469 00:24:25,760 --> 00:24:28,280 Speaker 6: I think that the four dollar increase that we saw 470 00:24:28,320 --> 00:24:32,760 Speaker 6: overnight was too much. You know, we've had regional conflict 471 00:24:32,800 --> 00:24:35,600 Speaker 6: between Israel and Goza before and oil prices jump a 472 00:24:35,600 --> 00:24:37,920 Speaker 6: little and then they come back down because people realize 473 00:24:38,040 --> 00:24:42,159 Speaker 6: there is no larger impact to oil producers. But in 474 00:24:42,200 --> 00:24:44,919 Speaker 6: this case we are really, I think, on the verge 475 00:24:45,040 --> 00:24:49,160 Speaker 6: of a larger geopolitical regional conflict. There are so many 476 00:24:49,200 --> 00:24:52,440 Speaker 6: other pieces here that it isn't that the jump and 477 00:24:52,480 --> 00:24:56,800 Speaker 6: oil prices is basically anticipating that it's anticipating that there 478 00:24:56,840 --> 00:24:59,720 Speaker 6: could be some kind of disruption, and that that's more 479 00:24:59,880 --> 00:25:02,560 Speaker 6: like in this case than it has been in the past. 480 00:25:02,760 --> 00:25:05,000 Speaker 2: And I diagnosed the sell off as well last week 481 00:25:05,000 --> 00:25:06,280 Speaker 2: too out of it. If we can finish, do I 482 00:25:06,280 --> 00:25:08,720 Speaker 2: think it's important Was that sell off in anticipation of 483 00:25:08,800 --> 00:25:12,199 Speaker 2: potential boost the crude output from Saudi or was it 484 00:25:12,200 --> 00:25:15,640 Speaker 2: because we saw evidence of our demand limits being tested 485 00:25:15,760 --> 00:25:17,120 Speaker 2: by this price search. 486 00:25:18,560 --> 00:25:21,840 Speaker 6: I think it's the second. It's definitely more of a 487 00:25:22,080 --> 00:25:25,960 Speaker 6: larger demand issue that is coming to light or that 488 00:25:26,119 --> 00:25:28,920 Speaker 6: is finally being realized in the market. I do think 489 00:25:29,000 --> 00:25:32,840 Speaker 6: that the news that Saudi Arabia could increase production starting 490 00:25:32,920 --> 00:25:35,800 Speaker 6: in twenty twenty four, if this, you know, if they 491 00:25:35,840 --> 00:25:39,000 Speaker 6: get what they want from Washington is definitely could definitely 492 00:25:39,000 --> 00:25:42,120 Speaker 6: be a catalyst. But that really didn't come out until Friday, 493 00:25:42,240 --> 00:25:44,760 Speaker 6: and the sell off had started before that. So I 494 00:25:44,760 --> 00:25:48,240 Speaker 6: do think it's much more based on the demand issue. 495 00:25:48,359 --> 00:25:50,720 Speaker 2: That news was dated pretty quickly. Let's put it that way, 496 00:25:50,840 --> 00:25:53,080 Speaker 2: and I thank you. In the world of the Atlantic Council, 497 00:25:56,520 --> 00:25:59,080 Speaker 2: Steak Chevrone joins US now at a multi asset solutions 498 00:25:59,080 --> 00:26:01,880 Speaker 2: that federated and they stay. A question I think people 499 00:26:01,880 --> 00:26:04,199 Speaker 2: will be asking the market is whether this represents a 500 00:26:04,320 --> 00:26:07,680 Speaker 2: durable headwind to invest the sentiment. Do you think it could? 501 00:26:08,160 --> 00:26:10,080 Speaker 7: Yeah, I mean it certainly adds to uncertainty. 502 00:26:10,119 --> 00:26:12,560 Speaker 8: I mean it's a difficult question to answer, John, I mean, 503 00:26:13,119 --> 00:26:16,639 Speaker 8: just watching the footage over the weekend, I mean, I 504 00:26:16,680 --> 00:26:18,920 Speaker 8: know we have a job to do, but I feel 505 00:26:18,960 --> 00:26:22,600 Speaker 8: like equities are the least important thing considering some of 506 00:26:22,640 --> 00:26:25,240 Speaker 8: the images we saw over the weekend, I mean, all 507 00:26:25,280 --> 00:26:28,160 Speaker 8: things being considered, just trying to decipher it. Obviously, it's 508 00:26:28,280 --> 00:26:31,440 Speaker 8: it's an upward pressure on the commodity complex and oil. 509 00:26:31,520 --> 00:26:35,200 Speaker 8: It adds to uncertainty in the markets. Yeah, you saw 510 00:26:35,280 --> 00:26:38,040 Speaker 8: bonds rally a little bit, but not anything major. 511 00:26:38,119 --> 00:26:39,160 Speaker 7: I mean, we've seen. 512 00:26:39,320 --> 00:26:42,000 Speaker 8: Treasurey yields go up ten basis points in a day. 513 00:26:42,520 --> 00:26:44,880 Speaker 8: You know, a four basis point decline and international high 514 00:26:44,960 --> 00:26:49,120 Speaker 8: quality bonds isn't much. I think the point you just made, though, 515 00:26:49,119 --> 00:26:53,040 Speaker 8: is the appropriate one. You know, what happens next and 516 00:26:53,080 --> 00:26:55,879 Speaker 8: does this spreads it become a wider regional conflict than 517 00:26:55,920 --> 00:26:57,440 Speaker 8: that has all kinds of implications. 518 00:26:57,480 --> 00:26:59,520 Speaker 7: But at this point, and when we all have to 519 00:26:59,520 --> 00:27:00,160 Speaker 7: wait and see. 520 00:27:00,960 --> 00:27:05,160 Speaker 1: You are wonderful at the cross asset analysis, this bond 521 00:27:05,160 --> 00:27:08,199 Speaker 1: tobaccle that we're in right now. How does it affect 522 00:27:08,240 --> 00:27:10,600 Speaker 1: Steve Off? I mean, is he getting his requisitt nine 523 00:27:10,600 --> 00:27:13,200 Speaker 1: hours sleep a night? How does it affect the world 524 00:27:13,200 --> 00:27:13,879 Speaker 1: of equities? 525 00:27:14,040 --> 00:27:15,760 Speaker 7: So Steve and I are very close. I don't know 526 00:27:15,760 --> 00:27:16,600 Speaker 7: what he does at night. 527 00:27:17,880 --> 00:27:19,879 Speaker 8: What I will say is that you know, there's a 528 00:27:19,920 --> 00:27:22,920 Speaker 8: lot of it's a hard one to tell. You've got 529 00:27:22,920 --> 00:27:26,840 Speaker 8: a yield curve this uninverting, and historically when that happens, 530 00:27:27,960 --> 00:27:30,400 Speaker 8: that's a real imminent sign of recession. But it's never 531 00:27:30,480 --> 00:27:33,360 Speaker 8: uninverted this way, which is this kind of bearish steepener. 532 00:27:33,400 --> 00:27:35,959 Speaker 8: It's not like the two year yield is falling an 533 00:27:36,000 --> 00:27:37,280 Speaker 8: anticipation of cuts. 534 00:27:37,680 --> 00:27:39,600 Speaker 7: You've got a ten year that's rising. 535 00:27:39,640 --> 00:27:41,840 Speaker 8: And the question is is there a buyer's strike on 536 00:27:41,880 --> 00:27:44,879 Speaker 8: the treasury or is the market trying to normalize to 537 00:27:44,920 --> 00:27:47,040 Speaker 8: a new normal of a kind of five to six 538 00:27:47,080 --> 00:27:48,199 Speaker 8: percent nomenal GDP. 539 00:27:48,920 --> 00:27:51,200 Speaker 7: And one of those is much more bullish than the other. 540 00:27:51,560 --> 00:27:53,760 Speaker 1: Tell me about value versus Carlton, I mean, I was 541 00:27:53,800 --> 00:27:57,359 Speaker 1: shocked on the exon Pioneer transaction rumored last week that 542 00:27:57,440 --> 00:28:00,880 Speaker 1: these are ten and twelve and thirteen multiple companies where 543 00:28:00,880 --> 00:28:04,159 Speaker 1: we're talking about the chosen seven are twenty five and 544 00:28:04,280 --> 00:28:07,639 Speaker 1: thirty multiple companies as well. How do you define a 545 00:28:07,760 --> 00:28:10,000 Speaker 1: federated growth in value? 546 00:28:10,520 --> 00:28:13,000 Speaker 8: Well, just using a simple kind of rustle one thousand 547 00:28:13,000 --> 00:28:17,199 Speaker 8: growth versus value. Coming into this year, we thought inflation 548 00:28:17,200 --> 00:28:18,720 Speaker 8: would be a little bit more adorable and the Fed 549 00:28:18,760 --> 00:28:20,520 Speaker 8: would hike more than the market expected. 550 00:28:20,560 --> 00:28:21,160 Speaker 7: That was right. 551 00:28:21,760 --> 00:28:24,160 Speaker 8: We thought growth might struggle a little under that environment, 552 00:28:24,280 --> 00:28:28,960 Speaker 8: and that wasn't. We still think that this market broadens out. 553 00:28:29,359 --> 00:28:31,960 Speaker 8: We think it broadens out to cyclicals pricing out some 554 00:28:32,119 --> 00:28:34,520 Speaker 8: recession risk at least in the short run. We think 555 00:28:34,520 --> 00:28:37,840 Speaker 8: the dividend players and their safety are attractive. And so 556 00:28:37,920 --> 00:28:39,880 Speaker 8: yet we've nibbled on large cap growth on the most 557 00:28:39,960 --> 00:28:42,160 Speaker 8: recent sell off because we've been so underweight. But we 558 00:28:42,160 --> 00:28:44,600 Speaker 8: still think that there's an opportunity for the market to 559 00:28:44,640 --> 00:28:45,120 Speaker 8: broaden out. 560 00:28:45,240 --> 00:28:47,600 Speaker 5: There's a question about how much can change in a minute, 561 00:28:47,600 --> 00:28:50,520 Speaker 5: given some of the concern that we're seeing percolate out 562 00:28:50,560 --> 00:28:54,920 Speaker 5: of yet another front for geopolitical conflagration. How much would 563 00:28:54,920 --> 00:28:58,080 Speaker 5: your view change should oil sort of bear the brunt 564 00:28:58,080 --> 00:28:59,840 Speaker 5: of this if we do see any kind of disruption, 565 00:29:00,040 --> 00:29:02,920 Speaker 5: We do see oil prices climb above a hundred barrels 566 00:29:02,960 --> 00:29:05,360 Speaker 5: one hundred dollars a barrel on a sustainable basis. 567 00:29:05,760 --> 00:29:08,680 Speaker 8: Yeah, I mean, look with the market and the Fed 568 00:29:08,840 --> 00:29:11,200 Speaker 8: are trying to pull off here as an inside straight 569 00:29:11,360 --> 00:29:15,400 Speaker 8: to a softer landing, and so anything that makes that 570 00:29:15,440 --> 00:29:17,640 Speaker 8: path more difficult is a challenge, whether or not that's 571 00:29:17,720 --> 00:29:23,120 Speaker 8: higher oil prices, resurgent inflation, rising delinquencies, you know, a 572 00:29:23,160 --> 00:29:25,560 Speaker 8: ten year yield that becomes unhinged to the upside. Those 573 00:29:25,600 --> 00:29:28,720 Speaker 8: are all risk factors. And I think what the last 574 00:29:28,800 --> 00:29:30,120 Speaker 8: year has told us is you want to be humble. 575 00:29:30,200 --> 00:29:33,560 Speaker 8: You want portfolios that are close to neutral, pointed in 576 00:29:33,600 --> 00:29:35,600 Speaker 8: the direction of your fundamental view. And so you know, 577 00:29:35,640 --> 00:29:38,080 Speaker 8: we think markets are a little bit upside biased here 578 00:29:38,360 --> 00:29:41,720 Speaker 8: or certainly before the weekend, but you want to stay 579 00:29:41,760 --> 00:29:43,640 Speaker 8: close to neutral and humble because there's a lot of 580 00:29:43,720 --> 00:29:46,280 Speaker 8: risk factors out here that are really unprecedented. 581 00:29:46,600 --> 00:29:49,120 Speaker 2: City this morning, send the conflict in Israel to come 582 00:29:49,120 --> 00:29:51,480 Speaker 2: and say, snakflation reshunk to the this is rady economy. 583 00:29:51,920 --> 00:29:54,000 Speaker 2: Could you say the same thing about a global economy 584 00:29:54,200 --> 00:29:56,360 Speaker 2: right now? Given what you're saying, galswe. 585 00:29:55,920 --> 00:29:56,800 Speaker 7: It's certainly possible. 586 00:29:56,800 --> 00:29:59,160 Speaker 8: But again, I think what has to happen there to 587 00:29:59,200 --> 00:30:03,520 Speaker 8: be a real stagflation aya event is you need to 588 00:30:03,600 --> 00:30:05,360 Speaker 8: draw in some of the northern countries or you need 589 00:30:05,400 --> 00:30:09,560 Speaker 8: a tax only I'm not really Iranian refineries or things 590 00:30:09,560 --> 00:30:12,239 Speaker 8: of that nature. That there's probably not enough of an 591 00:30:12,240 --> 00:30:16,280 Speaker 8: oil price shock where things are located today, but a 592 00:30:16,360 --> 00:30:18,280 Speaker 8: spreading of that certainly can. 593 00:30:18,600 --> 00:30:22,520 Speaker 7: And again, look on this theme of humility, John, if you. 594 00:30:22,480 --> 00:30:25,200 Speaker 8: Would have asked me, you know, what would have happened 595 00:30:25,240 --> 00:30:28,080 Speaker 8: in the wake of the Ukraine invasion, who would have 596 00:30:28,120 --> 00:30:31,480 Speaker 8: gotten the market reaction right? And so these we're not 597 00:30:31,560 --> 00:30:33,760 Speaker 8: experts in these areas, and we stick to the fundamentals 598 00:30:33,800 --> 00:30:34,560 Speaker 8: as best as we can. 599 00:30:34,680 --> 00:30:36,320 Speaker 2: It's one of those mornings where you can learn some 600 00:30:36,400 --> 00:30:38,719 Speaker 2: think about how the market is responding to this incoming 601 00:30:38,760 --> 00:30:40,959 Speaker 2: information and events over the weekend. In some ways, it's 602 00:30:41,000 --> 00:30:43,640 Speaker 2: a shame the cash treasury market is close today. We 603 00:30:43,760 --> 00:30:46,560 Speaker 2: learning the bonds still provide those risk mitigation characteristics. 604 00:30:46,800 --> 00:30:48,880 Speaker 7: I think there's no question about that. 605 00:30:49,160 --> 00:30:53,440 Speaker 8: Every time that bonds as a downside protection mechanism have 606 00:30:53,560 --> 00:30:58,840 Speaker 8: been doubted, you know that they show up. And so look, 607 00:30:58,880 --> 00:31:02,080 Speaker 8: I mean unless we're looking at some you know, massively 608 00:31:02,120 --> 00:31:05,280 Speaker 8: secular buyers striking, and I think it's premature to say that. 609 00:31:06,240 --> 00:31:08,760 Speaker 8: I think when there's trouble in the world, the safest 610 00:31:08,760 --> 00:31:10,760 Speaker 8: asset is the United States Treasury and I don't think 611 00:31:10,760 --> 00:31:12,960 Speaker 8: anything's changed about that, and I think we'll probably see 612 00:31:13,000 --> 00:31:13,520 Speaker 8: that tomorrow. 613 00:31:13,800 --> 00:31:16,120 Speaker 5: What are you watching as this sort of progresses over 614 00:31:16,200 --> 00:31:18,560 Speaker 5: the next hours and days, as we read all of 615 00:31:18,600 --> 00:31:22,440 Speaker 5: the news and how it's potentially spreading or being contained. 616 00:31:22,560 --> 00:31:25,440 Speaker 5: What are you looking for to potentially change your outlook one. 617 00:31:25,360 --> 00:31:25,920 Speaker 7: Way or another. 618 00:31:26,360 --> 00:31:29,400 Speaker 8: Well, again, I think you know, spreading north, whether it's 619 00:31:29,480 --> 00:31:32,680 Speaker 8: Lebanon or whether there's any kind of direct involvement with 620 00:31:32,720 --> 00:31:34,640 Speaker 8: the Uranians, would certainly be something to watch. 621 00:31:35,840 --> 00:31:38,520 Speaker 7: I think. In addition, you know, if you. 622 00:31:38,520 --> 00:31:41,200 Speaker 8: Start to see how to say this, but if you 623 00:31:41,200 --> 00:31:45,040 Speaker 8: see kind of any terrorist activity in non Middle Eastern countries, 624 00:31:45,120 --> 00:31:47,280 Speaker 8: you know, that's something that certainly could shake confidence in 625 00:31:47,280 --> 00:31:49,760 Speaker 8: the world, and you watch closely and then honestly, at 626 00:31:49,840 --> 00:31:52,400 Speaker 8: least in more than anything, it's just watching in horror 627 00:31:52,400 --> 00:31:54,720 Speaker 8: at the atrocities that are going on and feeling heartbroken 628 00:31:54,720 --> 00:31:55,200 Speaker 8: about it. 629 00:31:55,360 --> 00:31:57,880 Speaker 2: Just trity Shelkin stay, thank you, sir, Thanks for the 630 00:31:57,960 --> 00:32:11,880 Speaker 2: inside this morning. Steve Cheffer on that Federal hermes the 631 00:32:11,920 --> 00:32:15,160 Speaker 2: Israel Hamas conflict entering the third day with over oney 632 00:32:15,240 --> 00:32:18,720 Speaker 2: one hundred dead. Israeli forces responding with strikes in Gaza 633 00:32:18,800 --> 00:32:22,560 Speaker 2: after the militant group entered Israel, taking hostages. Over the weekend, 634 00:32:22,840 --> 00:32:25,480 Speaker 2: the Wall Street Journal reporting Irani and security officials held 635 00:32:25,560 --> 00:32:29,040 Speaker 2: plan what would be the biggest Israeli security failure in decades. 636 00:32:29,320 --> 00:32:32,000 Speaker 2: US Secretary of State Anthony Blincoln maintaining they have not 637 00:32:32,040 --> 00:32:34,200 Speaker 2: seen evidence to confirm cooperation. 638 00:32:34,720 --> 00:32:38,200 Speaker 9: There's a long relationship between Iran and Hamas. In fact, 639 00:32:38,320 --> 00:32:40,680 Speaker 9: Hamas wouldn't be Hamas without the support that it's gotten 640 00:32:40,680 --> 00:32:44,000 Speaker 9: over many years from Iran. We haven't yet seen direct 641 00:32:44,040 --> 00:32:47,040 Speaker 9: evidence that Iran was behind this particular attack or involved, 642 00:32:47,080 --> 00:32:49,520 Speaker 9: but the support over many years is clear. 643 00:32:49,800 --> 00:32:52,040 Speaker 2: Joining us now is Norman Rule, Senior advisor for the 644 00:32:52,080 --> 00:32:56,480 Speaker 2: Transnational Threats Project at the Center for Strategic and International Studies. 645 00:32:56,520 --> 00:32:59,960 Speaker 2: Norman spent thirty four years in the Central Intelligence Agents 646 00:33:00,080 --> 00:33:05,640 Speaker 2: see Norman. Wonderful to catch up with you under tragic circumstances. Obviously, Norman, 647 00:33:05,680 --> 00:33:07,080 Speaker 2: we have to start with the main question that was 648 00:33:07,080 --> 00:33:09,560 Speaker 2: on the lips of everybody. What happened and how did 649 00:33:09,560 --> 00:33:11,040 Speaker 2: this happen? Over the weekend? 650 00:33:12,360 --> 00:33:16,640 Speaker 10: Good morning. Israeli security forces, primarily the Shin that have 651 00:33:16,680 --> 00:33:20,320 Speaker 10: had responsibility for Godza on the occupied territories, and they 652 00:33:20,320 --> 00:33:25,960 Speaker 10: have over the years demonstrated a very capable architecture of 653 00:33:26,680 --> 00:33:29,920 Speaker 10: surveilling Palestine activity, and this has allowed them to frustrate 654 00:33:30,080 --> 00:33:35,040 Speaker 10: multiple Palestine attacks and identify, locate, and when necessary, neutralized 655 00:33:35,320 --> 00:33:38,880 Speaker 10: Hamas and other Palestine officials. In this case, it appears 656 00:33:39,480 --> 00:33:44,920 Speaker 10: that Hamas was able to develop a compartmented planning, execution, 657 00:33:45,120 --> 00:33:48,520 Speaker 10: and training program within that security bubble that not only 658 00:33:48,560 --> 00:33:53,960 Speaker 10: evaded Israeli surveillance but enabled this operation to be undertaken 659 00:33:54,000 --> 00:33:58,120 Speaker 10: without Israel seeing indicators that this existed. To be clear, 660 00:33:58,240 --> 00:34:01,760 Speaker 10: this is an intelligence failure by Israel. However, they have 661 00:34:01,800 --> 00:34:05,200 Speaker 10: a very capable intelligence service and are catching up. And also, 662 00:34:05,280 --> 00:34:07,520 Speaker 10: to be clear, this is a failure by the international 663 00:34:07,560 --> 00:34:11,239 Speaker 10: community as well. American other countries do not see the 664 00:34:11,280 --> 00:34:15,400 Speaker 10: protection of their nationals to Israeli security services, and we 665 00:34:15,640 --> 00:34:19,640 Speaker 10: also did not see the indicators of these of the. 666 00:34:19,960 --> 00:34:22,759 Speaker 1: Bend Norman, wonderful to have you with us and with 667 00:34:22,840 --> 00:34:24,920 Speaker 1: your years and years with the CIA. This is not 668 00:34:25,080 --> 00:34:26,320 Speaker 1: Matt Damon in a movie. 669 00:34:26,320 --> 00:34:27,279 Speaker 7: This is reality. 670 00:34:27,920 --> 00:34:32,120 Speaker 1: How do you take over a geography that is two 671 00:34:32,280 --> 00:34:35,879 Speaker 1: times the size of Washington, d c. And as two 672 00:34:35,920 --> 00:34:39,319 Speaker 1: million people crammed into it. How do you link your 673 00:34:39,360 --> 00:34:45,719 Speaker 1: intelligence knowledge with a military effort to de Hamas Gaza. 674 00:34:46,960 --> 00:34:50,799 Speaker 10: It's it's possible, and Israel has done this for some 675 00:34:51,040 --> 00:34:55,640 Speaker 10: time with Gaza, the West Bank and for Lebanon. However, 676 00:34:55,719 --> 00:34:59,720 Speaker 10: you raise an extremely important point for Israel to consider 677 00:34:59,719 --> 00:35:03,239 Speaker 10: grind operations or hostage rescue operations. This is one of 678 00:35:03,280 --> 00:35:06,319 Speaker 10: the most challenging environments on the planet. It's not just 679 00:35:06,360 --> 00:35:09,160 Speaker 10: that this is a concentrated civilian areas. This is a 680 00:35:09,160 --> 00:35:13,840 Speaker 10: concentrated civilian area with very tall buildings. Now, the United 681 00:35:13,880 --> 00:35:17,640 Speaker 10: States and Iraq and Britain have some experience in working 682 00:35:17,680 --> 00:35:21,440 Speaker 10: this in Iraq and Afghanistan, but these were much smaller 683 00:35:21,520 --> 00:35:26,120 Speaker 10: areas which with much shorter buildings. For Israel, this is 684 00:35:26,160 --> 00:35:30,160 Speaker 10: an extraordinarily difficult challenge and no one should underplay the 685 00:35:30,440 --> 00:35:34,160 Speaker 10: casualty account that is likely to happen for Israelis and 686 00:35:34,200 --> 00:35:37,600 Speaker 10: Palestinians and ground operations are undertaken. 687 00:35:38,160 --> 00:35:40,160 Speaker 1: You look at the narrow like that, and you also 688 00:35:40,200 --> 00:35:42,279 Speaker 1: look at the bigger. In your writings, you talk of 689 00:35:42,320 --> 00:35:46,239 Speaker 1: a multipolar dynamic, and you take the tensions of the 690 00:35:46,239 --> 00:35:48,840 Speaker 1: Middle East and the Levant back to eighteen seventy and 691 00:35:48,920 --> 00:35:53,520 Speaker 1: nineteen thirty, way before nineteen sixty seven as well. What's 692 00:35:53,520 --> 00:35:57,000 Speaker 1: a multipolar dynamic that Israel faces right now? 693 00:35:57,920 --> 00:36:00,239 Speaker 10: Well, it's a good news bad news story. You have 694 00:36:00,280 --> 00:36:04,279 Speaker 10: a situation where in the good news side there are strategic, 695 00:36:04,440 --> 00:36:09,040 Speaker 10: long term and continuing drivers by for the Saudis and 696 00:36:09,080 --> 00:36:12,360 Speaker 10: for the Amorades and others to promote regional integration. That 697 00:36:12,520 --> 00:36:16,240 Speaker 10: must include Israel because of its geographic location, that hasn't 698 00:36:16,280 --> 00:36:19,840 Speaker 10: gone away, and that will sustain the ongoing diplomatic process 699 00:36:19,880 --> 00:36:23,920 Speaker 10: between the United States, Saudi Arabia, and Israel to restore relations. 700 00:36:24,200 --> 00:36:28,520 Speaker 10: On the downside, you have an international community that is 701 00:36:28,600 --> 00:36:32,440 Speaker 10: cracked apart, so pulling together Russia, China, and the European 702 00:36:32,480 --> 00:36:35,600 Speaker 10: community in a way that actually promotes a peace plan 703 00:36:35,680 --> 00:36:38,080 Speaker 10: of some consequence will be impossible. 704 00:36:38,280 --> 00:36:40,440 Speaker 5: There's also a question about the role of Iran, especially 705 00:36:40,480 --> 00:36:42,319 Speaker 5: as the Wall Street Journal is reporting that they had 706 00:36:42,320 --> 00:36:45,360 Speaker 5: an active role in helping to plan this attack. We 707 00:36:45,400 --> 00:36:48,440 Speaker 5: have not heard from the US government confirming that. They 708 00:36:48,440 --> 00:36:52,600 Speaker 5: said they are investigating. What are the potential consequences, what 709 00:36:52,719 --> 00:36:56,760 Speaker 5: is the escalation type of potential. If Iran is deemed 710 00:36:56,800 --> 00:37:01,520 Speaker 5: to have had an active role in planning these attat. 711 00:37:00,840 --> 00:37:03,960 Speaker 10: We should be careful about the report. Iran is unlikely 712 00:37:04,040 --> 00:37:07,680 Speaker 10: to have played a robust, active role in planning the 713 00:37:07,680 --> 00:37:10,319 Speaker 10: attack simply because they are not on the ground, They 714 00:37:10,360 --> 00:37:12,799 Speaker 10: do not have personnel on the ground, they would not 715 00:37:12,840 --> 00:37:17,520 Speaker 10: be able to provide an intelligence of input to those operations, 716 00:37:17,560 --> 00:37:22,280 Speaker 10: and their involvement would compromise the compartmentation of the operation. However, 717 00:37:22,320 --> 00:37:25,680 Speaker 10: Iran has provided drones, training money for over the years. 718 00:37:25,840 --> 00:37:29,120 Speaker 10: As Secretary blink and Is correctly stated, Hamas would not 719 00:37:29,160 --> 00:37:32,640 Speaker 10: be Hamas without Iran, but that it's Iran's modus operandi. 720 00:37:32,719 --> 00:37:35,759 Speaker 10: In essence, what they do is they enable proxies to 721 00:37:35,800 --> 00:37:41,120 Speaker 10: conduct operations that parallel Iran's strategic objectives. Those operations play out, 722 00:37:41,360 --> 00:37:43,520 Speaker 10: Iran is able to say it supported them and enabled 723 00:37:43,560 --> 00:37:47,200 Speaker 10: them iron achieves and strategic goals, but Iran's direct hand 724 00:37:47,280 --> 00:37:50,719 Speaker 10: is not seen, and thus Iran escapes international punishment. 725 00:37:51,280 --> 00:37:54,440 Speaker 5: The speculation is that one of the strategic aims was 726 00:37:54,520 --> 00:37:58,000 Speaker 5: to disrupt the Saudi Arabia Israeli agreement that was being 727 00:37:58,040 --> 00:38:00,120 Speaker 5: worked on and coming to some sort of fruition in 728 00:38:00,120 --> 00:38:01,040 Speaker 5: the next couple. 729 00:38:00,800 --> 00:38:01,800 Speaker 7: Of weeks and days. 730 00:38:02,080 --> 00:38:03,960 Speaker 5: How much do you think that that has been iced? 731 00:38:04,000 --> 00:38:07,239 Speaker 5: How much are people really discussing that aspect of the 732 00:38:07,280 --> 00:38:10,880 Speaker 5: strategic potential motivation for the timing of this attack. 733 00:38:11,920 --> 00:38:14,759 Speaker 10: There's no question that that was likely one of the motivations. 734 00:38:14,800 --> 00:38:17,279 Speaker 10: But this is a pie that has multiple pieces in it. 735 00:38:17,560 --> 00:38:21,040 Speaker 10: This operation was clearly developed over many, many months. It 736 00:38:21,040 --> 00:38:23,520 Speaker 10: would have taken a very long time, if only because 737 00:38:23,560 --> 00:38:27,440 Speaker 10: of the compartmentation requirements to pull this together, and therefore 738 00:38:27,440 --> 00:38:30,759 Speaker 10: it had a number of reasons. The Ricey government and 739 00:38:30,800 --> 00:38:34,799 Speaker 10: its proxies have maintained an assertive foreign policy posture for 740 00:38:34,840 --> 00:38:38,040 Speaker 10: a very long time. There was no specific incident that 741 00:38:38,160 --> 00:38:41,560 Speaker 10: provoked this, but certainly one of the benefits for hardliners 742 00:38:41,560 --> 00:38:44,799 Speaker 10: in Iran and the proxies is that this will complicate, 743 00:38:45,320 --> 00:38:48,600 Speaker 10: if not disrupt, the diplomatic process underway. 744 00:38:48,800 --> 00:38:51,920 Speaker 2: Norman, we know based on reports they've taken scores of hostages. 745 00:38:52,280 --> 00:38:56,240 Speaker 2: Does that complicate Israel's response to this hugely? 746 00:38:56,360 --> 00:38:59,960 Speaker 10: And we should note that these are international hostages. Reports 747 00:39:00,080 --> 00:39:04,120 Speaker 10: are unconfirmed, but there may be Chinese, French, tie as 748 00:39:04,120 --> 00:39:07,560 Speaker 10: well as American hostages as well as among the dead 749 00:39:08,200 --> 00:39:10,560 Speaker 10: in Israel. So the international this is in many ways 750 00:39:10,560 --> 00:39:14,600 Speaker 10: a Hamas attack against the international community. These hostages will 751 00:39:14,640 --> 00:39:20,000 Speaker 10: be dispersed within Gaza. Isolating them and identifying their locations 752 00:39:20,040 --> 00:39:24,000 Speaker 10: and developing rescue plans will be very, very difficult. The 753 00:39:24,120 --> 00:39:27,040 Speaker 10: United States has considerable experience here will no doubt be 754 00:39:27,120 --> 00:39:30,920 Speaker 10: sending intelligence security personnel to assist the Israelis, who are 755 00:39:30,960 --> 00:39:33,920 Speaker 10: also very good at this. This will also inject considerable 756 00:39:33,960 --> 00:39:37,400 Speaker 10: amount of complications and diplomacy. So we've watched the United States, 757 00:39:37,520 --> 00:39:41,000 Speaker 10: Saudi Arabia and others engage Katar, Turkey which have good 758 00:39:41,000 --> 00:39:43,959 Speaker 10: relations with Hamas, and a variety of actors to see 759 00:39:44,040 --> 00:39:47,440 Speaker 10: how this plays out. It is not inconceivable that you 760 00:39:47,440 --> 00:39:50,040 Speaker 10: will have outreach to Iran itself to assist on this. 761 00:39:50,360 --> 00:39:53,120 Speaker 10: That rarely works out. Well, you should recall what happened 762 00:39:53,200 --> 00:39:55,640 Speaker 10: last when Iran at hostages in Lebanon. 763 00:39:55,800 --> 00:40:01,239 Speaker 1: Norman, I'll Kissinger, Merzheimer, Robert D. Aapplin, and frankly you, 764 00:40:02,080 --> 00:40:05,160 Speaker 1: is this a day where America shifts back to real politics? 765 00:40:05,200 --> 00:40:08,440 Speaker 1: I mean, forget about shuttle diplomacy and all of that 766 00:40:08,920 --> 00:40:11,880 Speaker 1: this morning. Is it all about a real politic that 767 00:40:11,920 --> 00:40:14,560 Speaker 1: we think we have forgotten and moved on from. 768 00:40:14,920 --> 00:40:18,400 Speaker 10: Well, the line of the Middle East is unlike Las Vegas. 769 00:40:18,440 --> 00:40:21,000 Speaker 10: What happens in the Middle East never stays in the 770 00:40:21,000 --> 00:40:24,680 Speaker 10: Middle East. And the Biden administration will need to develop 771 00:40:24,760 --> 00:40:28,200 Speaker 10: not only a strategy to address this issue, a strategy 772 00:40:28,200 --> 00:40:32,120 Speaker 10: to see how this impacts existing programs such as the 773 00:40:32,160 --> 00:40:35,200 Speaker 10: Iran and Saudi and other initiatives. But likewise they're going 774 00:40:35,239 --> 00:40:37,040 Speaker 10: to have to staff this out. They're going to have 775 00:40:37,080 --> 00:40:40,600 Speaker 10: to apply a lot of personnel and policymaker bandwidth well, 776 00:40:40,760 --> 00:40:43,040 Speaker 10: which will come at a cost of other issues. This 777 00:40:43,120 --> 00:40:46,440 Speaker 10: is a seismic issue which is going to transform regional 778 00:40:47,000 --> 00:40:50,600 Speaker 10: policymaking and international policy making. We're in the early days 779 00:40:50,600 --> 00:40:53,320 Speaker 10: and the ripples of this attack in terms of policy 780 00:40:53,480 --> 00:40:56,080 Speaker 10: and domestic politics are still playing out. 781 00:40:56,760 --> 00:40:58,920 Speaker 2: I want to ask you this question to wrap things up, Norman, 782 00:40:59,360 --> 00:41:03,400 Speaker 2: no speaker House, no ambassador to Israel, AJB to Lebanon. 783 00:41:03,640 --> 00:41:06,880 Speaker 2: Is that a symbolic failure or that have real world consequences. 784 00:41:08,640 --> 00:41:12,600 Speaker 10: Well, it's certainly a symbolic problem, but we shouldn't discount 785 00:41:12,640 --> 00:41:16,719 Speaker 10: the capabilities and roles of our charges in these locations 786 00:41:16,760 --> 00:41:21,840 Speaker 10: of intelligence personnel of military personnel. Those communication channels remain robust, 787 00:41:21,960 --> 00:41:26,040 Speaker 10: and these capitals often deal directly with the United States 788 00:41:26,040 --> 00:41:29,840 Speaker 10: in Washington through their very able ambassadors. So the system 789 00:41:29,880 --> 00:41:33,320 Speaker 10: of handling this is underway and will be executed crisply. 790 00:41:33,560 --> 00:41:36,360 Speaker 10: It just would be better and easier if these personnel 791 00:41:36,440 --> 00:41:39,640 Speaker 10: were in place. And Israel has received a considerable boost 792 00:41:39,680 --> 00:41:42,400 Speaker 10: in the number of iron dome interceptors and ammunition it 793 00:41:42,440 --> 00:41:45,879 Speaker 10: will need, and that has occurred without the House being 794 00:41:45,880 --> 00:41:48,280 Speaker 10: in order. But we need to fix this. Norman. 795 00:41:48,360 --> 00:41:50,320 Speaker 2: Thank you for your insight this morning, and hopefully we 796 00:41:50,360 --> 00:41:52,200 Speaker 2: can catch up again before the end of the week. 797 00:41:52,200 --> 00:41:56,000 Speaker 2: Norman Rule there the Center for Strategic and International Studies. 798 00:41:56,440 --> 00:42:00,319 Speaker 1: Subscribe to the Bloomberg Surveillance podcast on Apple, Spotify, and 799 00:42:00,440 --> 00:42:04,600 Speaker 1: anywhere else you get your podcasts. Listen live every weekday 800 00:42:04,880 --> 00:42:08,400 Speaker 1: starting at seven am Easter. I'm Bloomberg dot Com, the 801 00:42:08,520 --> 00:42:13,040 Speaker 1: iHeartRadio app tune In, and the Bloomberg Business app. You 802 00:42:13,080 --> 00:42:17,120 Speaker 1: can watch us live on Bloomberg Television and always I'm 803 00:42:17,160 --> 00:42:21,160 Speaker 1: the Bloomberg Terminal. Thanks for listening. I'm Tom Keen, and 804 00:42:21,280 --> 00:42:22,760 Speaker 1: this is Bloomberg