WEBVTT - Davos Special: Trump Has Picked Smart People, Dalio Says 0:00:00.120 --> 0:00:02.920 Brought you by Bank of America, Mary Lynch. Investing in 0:00:03.000 --> 0:00:07.800 local communities, economies and a sustainable future. That's the power 0:00:08.080 --> 0:00:12.360 of global connections. Mary Lynch, Pierce Fenner and Smith Incorporated 0:00:12.760 --> 0:00:27.400 Member s I p C. Welcome to the Bloomberg Surveillance Podcast. 0:00:27.840 --> 0:00:31.520 I'm Tom Keene with David Gura. Daily we bring you 0:00:31.560 --> 0:00:36.600 insight from the best in economics, finance, investment and international relations. 0:00:37.000 --> 0:00:41.600 Find Bloomberg Surveillance on iTunes, SoundCloud, Bloomberg dot Com and 0:00:41.680 --> 0:00:49.919 of course on the Bloomberg We don't speak to one 0:00:49.960 --> 0:00:53.159 of the truly great voices and important voices of the 0:00:53.200 --> 0:00:56.600 meetings of the World Economic Forum, and that is Ray 0:00:56.920 --> 0:00:59.480 del Yo. You may know him among any other things, 0:00:59.480 --> 0:01:03.640 including someone who has given generously an interview time to 0:01:03.800 --> 0:01:08.479 Bloomberg Surveillance, but far more for running and investing money 0:01:09.680 --> 0:01:12.679 over the years in all different conditions and of course 0:01:12.720 --> 0:01:16.280 strapping it over from Bridgewater to an analysis of economics. 0:01:16.280 --> 0:01:17.760 I want to get to an in a moment, Ray 0:01:17.840 --> 0:01:21.040 Delia Daio, good morning, Thank you for being with us. 0:01:21.040 --> 0:01:23.600 How was the year for Bridgewater? Can you can you 0:01:23.640 --> 0:01:27.360 say given the cocopany out there, the systemic risk, the 0:01:27.480 --> 0:01:30.959 challenges of epsilon. Can you go into this year with 0:01:31.040 --> 0:01:36.200 the momentum? Well, last year we're up, depending on the account, 0:01:36.280 --> 0:01:40.119 somewhere between a couple of percent and about twelve percent. 0:01:40.400 --> 0:01:43.560 It was a lot better than others. Well that's not 0:01:44.080 --> 0:01:47.240 the best point in comparison, but anyway, it was a 0:01:47.319 --> 0:01:50.520 social year. Let's get to the panel, Francie Laqua holding 0:01:50.600 --> 0:01:53.880 court as you and any number of people disagreed. You know, 0:01:53.880 --> 0:01:56.080 I say, folks, the elite me degree. Well, that didn't 0:01:56.120 --> 0:02:00.520 happen with Ray Deelio. It's your panel. Professor Summers talks 0:02:00.560 --> 0:02:04.720 about a time of economic creationism, the new economics of 0:02:04.760 --> 0:02:08.000 the President elect. Where do you and Mr Summers disagree 0:02:08.080 --> 0:02:16.040 most in America's economics? Um, I think it's about populism. 0:02:16.160 --> 0:02:20.080 Um that the possibility that this can be effective, the 0:02:20.160 --> 0:02:27.040 possibility of bringing about economic revitalization business. It's okay to 0:02:27.080 --> 0:02:31.440 make a lot of money by bringing in businesses from 0:02:31.440 --> 0:02:33.760 other countries, I think the United States. There's a lot 0:02:33.760 --> 0:02:37.080 of positives in this. I think the big question is 0:02:37.080 --> 0:02:40.400 whether it will be well navigated. There's a populism going on. 0:02:40.760 --> 0:02:43.960 So let's let's label this around the world as a 0:02:43.960 --> 0:02:49.600 phenomenon called populism. It exists in Brexit, it existed in 0:02:49.680 --> 0:02:51.560 the thirties. We have to understand what it is. It 0:02:51.639 --> 0:02:56.360 represents a population that needs to be represented. The question 0:02:56.440 --> 0:03:00.400 is whether it's done intelligently or not intelligently. Now the 0:03:00.440 --> 0:03:03.919 words the revitalization of of of making money. So I 0:03:05.080 --> 0:03:08.720 think that this could be very good. It'll stimulate growth 0:03:09.480 --> 0:03:12.200 where the growth where there was a malaising growth before. 0:03:12.560 --> 0:03:16.280 The question is whether it's done thoughtfully and intelligently, whether 0:03:16.320 --> 0:03:19.480 this is going to require an engineering exercise. I love 0:03:19.520 --> 0:03:22.960 that idea, and this, of course uh comes from your uh, 0:03:23.120 --> 0:03:25.080 you know, your middle class upbring. I guess I would 0:03:25.080 --> 0:03:29.080 call it within Long Island years ago. Within that radio 0:03:29.160 --> 0:03:32.240 and within the need for engineering is the idea that 0:03:32.280 --> 0:03:35.680 we get a frontloaded benefit that dissipates one year out 0:03:35.800 --> 0:03:38.800 or three year out. Is that a tangible risk. I 0:03:38.840 --> 0:03:42.920 think that this could be sustained or it could be nothing, 0:03:43.000 --> 0:03:44.520 depending on how it is. Let me tell you what 0:03:44.600 --> 0:03:47.080 I think it is. I think we're in a period 0:03:47.120 --> 0:03:52.440 that's very similar to nineteen eighty transition between the left 0:03:52.760 --> 0:03:59.200 and the right, between more government and less government. Um, 0:03:59.240 --> 0:04:01.920 it was a time him when Ronald Reagan it would 0:04:01.960 --> 0:04:05.360 be more like supply side economics. It was a period 0:04:05.640 --> 0:04:09.800 that's quite like that, but different in that we don't 0:04:09.840 --> 0:04:13.560 have the capacity upboard capacity to grow in the same 0:04:13.560 --> 0:04:16.240 way because we were in a deep percession then, and 0:04:16.240 --> 0:04:19.400 we don't have the capacity to lower interest rates. So 0:04:19.480 --> 0:04:23.840 the new growth that could take place by new investment 0:04:23.920 --> 0:04:27.640 and new animal spirits um has to be very well 0:04:27.720 --> 0:04:32.680 engineered to find out where the capacity lies to invent 0:04:33.080 --> 0:04:36.840 invest correctly to make this To pull this off is 0:04:36.880 --> 0:04:40.440 going to require engineering, and I think the real question 0:04:40.520 --> 0:04:44.200 will be whether there's the skill and the patience to 0:04:44.440 --> 0:04:49.400 engineer a unique recovery when the economy is where it is. 0:04:49.560 --> 0:04:51.640 Let's bring in David Gurr in New York City. David 0:04:51.640 --> 0:04:54.320 Gurrow this morning with Ray Delio and Davos. Do you 0:04:54.360 --> 0:04:56.160 have a better sense of what the blueprint is going 0:04:56.200 --> 0:04:58.520 to look like? You've written about trying to understand how 0:04:58.520 --> 0:05:00.520 that the leverages will be moved in with the outcome 0:05:00.520 --> 0:05:03.039 of moving them is likely to produce. You wrote that 0:05:03.120 --> 0:05:05.400 shortly after the U. S presidential election. Are we any 0:05:05.400 --> 0:05:07.800 closer to getting a sense of what that engineering mechanism 0:05:07.839 --> 0:05:10.080 is going to look like? I think we know all 0:05:10.400 --> 0:05:13.480 the broad senses, and I don't think we know any 0:05:13.560 --> 0:05:18.200 of the details. When when you think that like the 0:05:18.240 --> 0:05:20.000 devil is in the details, I mean, I think we 0:05:20.080 --> 0:05:24.400 know that there is going to be UM more protection, 0:05:24.560 --> 0:05:31.680 is more UH capital investment, more tax benefits for companies, 0:05:32.160 --> 0:05:34.720 more changes in tax rates. We know that there's going 0:05:34.760 --> 0:05:39.040 to be uh a lot of things, but we don't 0:05:39.040 --> 0:05:43.039 know how it's going to be paid for, or how 0:05:43.080 --> 0:05:45.840 it's where the capacity is going to exist with the 0:05:45.880 --> 0:05:49.120 tightness in capacity. We don't know how it's going to 0:05:49.200 --> 0:05:52.720 be financed. We don't know even how those decisions are 0:05:52.720 --> 0:05:54.880 going to be made. We don't know the particular people 0:05:54.960 --> 0:05:58.200 and their interactions. We don't know a lot. We don't 0:05:58.200 --> 0:06:01.960 know what. Most importantly, I think we know that Donald 0:06:01.960 --> 0:06:07.000 Trump UM is a businessman and aggressive businessman, And what 0:06:07.080 --> 0:06:10.680 we don't know is whether he's going to be aggressive 0:06:10.680 --> 0:06:14.279 and thoughtful or aggressive and reckless. This is going to 0:06:14.520 --> 0:06:19.120 require a surgery, uh and whether there's good surgeons and 0:06:19.200 --> 0:06:23.240 executing this well. To pull off the sort of environment 0:06:23.279 --> 0:06:26.360 that we had from nineteen eighty to ninety five when 0:06:26.440 --> 0:06:29.960 Ronald Reagan came in is going to require skilled talent. 0:06:30.240 --> 0:06:32.599 We don't know yet how that will work. Again, I 0:06:32.680 --> 0:06:34.919 draw back to to what you wrote after the election. 0:06:34.960 --> 0:06:37.560 You said that the craziness factor may have been overestimated 0:06:37.560 --> 0:06:39.440 when it comes to to Donald Trump. He might be 0:06:39.480 --> 0:06:42.120 a less erratic leader than than many feared now a 0:06:42.120 --> 0:06:43.800 few years, a few months. Hence, do you feel do 0:06:43.839 --> 0:06:45.640 you feel the same way you see the tweets as 0:06:45.880 --> 0:06:48.080 we do every morning here, do you get the sense 0:06:48.120 --> 0:06:51.600 that that he's changing as a leader. I think he's 0:06:51.680 --> 0:06:57.120 chosen people around him who are buying large, thoughtful, respectable, 0:06:57.440 --> 0:07:02.200 intelligent people. Um. I think that's telling. And again I 0:07:02.240 --> 0:07:04.880 think that we don't know how those interactions are going 0:07:04.920 --> 0:07:09.240 to be. That's the uncertainty that's out there. Has Bridgewater 0:07:09.360 --> 0:07:13.320 had to adjust its investment stance because within my theme, 0:07:13.400 --> 0:07:18.040 we're living within uncertainty amid and uncertainty. How do you 0:07:18.080 --> 0:07:21.040 deal with it day to day? I think the important 0:07:21.040 --> 0:07:22.760 thing is to know what you know and you know 0:07:22.880 --> 0:07:25.160 what you don't know. Most of my success has come 0:07:25.240 --> 0:07:27.560 from me knowing what I don't know and how to 0:07:27.600 --> 0:07:30.320 deal with it. So we've been basically trying to be 0:07:30.400 --> 0:07:33.800 neutral to this whole thing. So we've been positioned pretty neutral. 0:07:33.840 --> 0:07:36.760 E in other words, is a way to diversify yourself 0:07:36.800 --> 0:07:39.480 away from this. I don't want to take bets on 0:07:39.480 --> 0:07:41.720 on this right now, Ragelio, thank you so much with 0:07:41.760 --> 0:07:44.920 Bridgewater this morning with us here at the meetings of 0:07:44.920 --> 0:07:59.600 the World Economic Forum in Davas, David Kerr in New York. 0:07:59.640 --> 0:08:02.800 I tell keenan Davos, Switzerland, the meetings of the World 0:08:02.840 --> 0:08:05.520 Economic Forum. And now a quick annual visit with Michael 0:08:05.520 --> 0:08:09.640 Porter of Harvard University. He took aerospace and mechanical engineering 0:08:09.720 --> 0:08:12.320 degrees at a school in New Jersey a few years ago, 0:08:12.360 --> 0:08:15.040 and it's of course held court at Harvard Business School. Uh, 0:08:15.120 --> 0:08:18.240 you came out of a school in New Jersey, darkened 0:08:18.240 --> 0:08:23.080 the door in Cambridge and you're acclaimed. Professor sent you 0:08:23.160 --> 0:08:28.320 a note and said Mr Porter joined the conversation. Speak up, 0:08:28.440 --> 0:08:32.280 young Porter. Is there too much conversation nowadays? Do we 0:08:32.320 --> 0:08:36.200 have a president elect who's just perhaps talking a little 0:08:36.240 --> 0:08:39.920 too much? Well, Tom, I I I hesitate to judge 0:08:39.920 --> 0:08:41.840 whether it's too much or too little. I think it's 0:08:41.880 --> 0:08:45.640 the wrong kind of conversation, it's the wrong tone of conversation. 0:08:46.520 --> 0:08:50.000 I think, Uh, the president uh is going to have 0:08:50.120 --> 0:08:54.560 to learn how to be a leader. Um, and leaders 0:08:54.720 --> 0:09:00.800 inspire leaders. Uh, bring together, not divide. Uh. Leaders build 0:09:00.800 --> 0:09:06.439 confidence in the future, not fear. Uh. Leaders um also 0:09:06.559 --> 0:09:10.240 think about people as human beings and neighbors that are 0:09:10.280 --> 0:09:14.840 gonna coexist together over time. And uh uh you know, 0:09:14.880 --> 0:09:16.800 we have a we have a program that we do 0:09:16.960 --> 0:09:20.000 for major company CEOs at Harvard. It's a boot camp 0:09:20.040 --> 0:09:22.719 and and we talk a lot about what makes an 0:09:22.720 --> 0:09:27.760 effective leader and uh we one of the poignant moments 0:09:27.800 --> 0:09:31.360 in that program is we uh it we go back 0:09:31.360 --> 0:09:34.520 to Aristotle and and it turns out that the Greek's 0:09:35.360 --> 0:09:38.600 society was the first society in history where actually leaders 0:09:38.640 --> 0:09:41.679 had to had to motivate people and bring them more. 0:09:41.720 --> 0:09:44.280 Before that, it was all power and military and birth 0:09:45.200 --> 0:09:49.880 right exactly. And um, great communication and great leadership is 0:09:49.920 --> 0:09:54.360 the combination of three things. One is logic, or what 0:09:54.400 --> 0:09:57.520 they call logos. Uh. Uh. You've got to be logical. 0:09:57.640 --> 0:10:00.880 It's got to make sense. Uh And frankly we stretch 0:10:01.000 --> 0:10:03.079 that in today's society, a lot of this stuff actually 0:10:03.160 --> 0:10:06.000 isn't logical, but most citizens really don't understand it isn't. 0:10:06.360 --> 0:10:08.760 The Second thing that great leaders have is in a 0:10:08.800 --> 0:10:12.360 sense of emotion. There's an emotion of of hope and 0:10:12.400 --> 0:10:15.679 opportunity and a little bit of nervousness. And but but 0:10:15.880 --> 0:10:18.720 you can't have too much fear. Uh, you have to 0:10:18.760 --> 0:10:20.840 have some sense of hope and opportunity. You've got to 0:10:20.840 --> 0:10:23.640 put those two together. And and then third, and the 0:10:23.720 --> 0:10:28.000 most important of all is UH is what's called ethos. Values. 0:10:28.440 --> 0:10:33.640 The great leaders get across values that people aspire to 0:10:33.880 --> 0:10:35.800 and want to be part of it. And I think 0:10:35.840 --> 0:10:40.160 the conversation now is missing the point. Can this administration 0:10:40.440 --> 0:10:42.960 take porter one oh one, which we just heard, thank 0:10:42.960 --> 0:10:45.960 you for laying it out so nicely, and retain their 0:10:46.080 --> 0:10:50.559 core American audience that wants an angry populism right now? 0:10:50.720 --> 0:10:54.160 How do you do both? I don't. I don't. I 0:10:54.240 --> 0:10:59.000 kind of reject the idea that that America wants angry populism. 0:10:59.440 --> 0:11:03.840 I think America has been taught uh to want angry populism. 0:11:03.960 --> 0:11:07.880 That's the political discourse that we've evolved and and it's 0:11:07.920 --> 0:11:09.920 grown and grown over the last ten or twenty years. 0:11:10.400 --> 0:11:13.480 We've been taught that to get something you want, you 0:11:13.600 --> 0:11:17.440 have to punish or dismiss what somebody else wants. UH. 0:11:17.480 --> 0:11:21.480 We're looking at almost every issue in society in a 0:11:21.480 --> 0:11:23.920 simplistic way. It's not that we want trade or we 0:11:23.960 --> 0:11:26.880 don't want trade. You know, we we want the nice 0:11:26.960 --> 0:11:29.079 combination of the good parts of trade, but we want 0:11:29.120 --> 0:11:31.440 to get away from the best parts of trade. Uh. 0:11:31.520 --> 0:11:34.360 It's not that we want, you know, small government or 0:11:34.400 --> 0:11:38.120 big government. We want an interesting combination of getting government 0:11:38.320 --> 0:11:40.040 in the right place at the right time, with the 0:11:40.120 --> 0:11:43.000 right resources, focusing on the right thing. So I think 0:11:43.000 --> 0:11:46.320 what's happened is we've we've had a societal discourse that's 0:11:46.360 --> 0:11:48.959 been I think led by our political process that is 0:11:49.120 --> 0:11:55.360 educated people. Uh, that that populism has any legitimacy. I mean, 0:11:55.440 --> 0:11:58.000 I think in America we were the uniquely the country 0:11:58.000 --> 0:12:00.960 where people got along. I mean in my colleague David 0:12:01.000 --> 0:12:03.199 Gore in New York City, David very quickly here. I 0:12:03.200 --> 0:12:05.560 wonder if the more as of how we regard leadership 0:12:05.640 --> 0:12:07.480 stand to change here with Donald Trump in office. I 0:12:07.480 --> 0:12:11.480 think of how carefully executives cultivate their social media presence 0:12:11.480 --> 0:12:13.920 and profiles, and we see what the president elect is doing. 0:12:13.920 --> 0:12:16.480 Do you think that's gonna perhaps a liberate executives in 0:12:16.520 --> 0:12:18.400 some way the expectations will change that they'll have to 0:12:18.400 --> 0:12:21.320 be seen as more straight shooters than they have been. Well, 0:12:21.360 --> 0:12:25.280 I think that that's a very hopeful, positive interpretation. And 0:12:25.320 --> 0:12:28.719 I do believe that all leaders of complex enterprise or 0:12:28.760 --> 0:12:34.160 complex the society's have to now communicate in more ways 0:12:34.240 --> 0:12:38.600 than they did historically. UM. You know that said UM, 0:12:38.640 --> 0:12:44.520 I think that the fundamental uh problem that the Trump 0:12:44.520 --> 0:12:50.719 administration has is um, they have to ultimately be perceived 0:12:50.880 --> 0:12:55.120 as a an administration for America and for a good 0:12:55.160 --> 0:12:58.080 society and for a better place to live, and for 0:12:58.160 --> 0:13:01.440 a better place to work and raise your kids. And 0:13:01.520 --> 0:13:04.080 a society where everybody's yelling at each other and thinks 0:13:04.160 --> 0:13:07.160 the other guys the enemy down the street is not 0:13:07.240 --> 0:13:11.040 a good society that ultimately is going to motivate and 0:13:11.040 --> 0:13:13.560 and uh and succeed. We would be honored to speak 0:13:13.600 --> 0:13:16.479 to you again at one hundred days of this new administration, 0:13:16.520 --> 0:13:19.200 because if I know one message from this valley, nobody 0:13:19.240 --> 0:13:21.600 knows where we're gonna be in a hundred days, white 0:13:21.640 --> 0:13:24.840 set of opinions. Michael Porter of Harvard Business School, I 0:13:24.840 --> 0:13:41.040 can't say the benefit he has created over the years here, Boy, 0:13:41.080 --> 0:13:43.000 have I been looking forward to this as as Mr 0:13:43.080 --> 0:13:46.000 Gurry in New York, he is a four star Admiral 0:13:46.000 --> 0:13:48.080 of the U. S. Navy. He is out of the 0:13:48.080 --> 0:13:52.800 Fletcher School tuss University. But far more than that, he's 0:13:52.800 --> 0:13:56.439 served a tour of duty for four years with NATO. 0:13:56.559 --> 0:13:59.200 James Travitiz has given us so much value in the 0:13:59.240 --> 0:14:02.760 recent years and joins us here in dubas Admiral. When 0:14:02.800 --> 0:14:05.679 you NATO to me is a concept to most of 0:14:05.720 --> 0:14:09.160 our listeners. When you where do you walk into NATO 0:14:09.200 --> 0:14:12.560 when you walk in the door. Is it in Brussels? Uh? 0:14:12.600 --> 0:14:15.959 The NATO political headquarters is in Brussels, tom and what 0:14:16.040 --> 0:14:18.880 you would think of as the pentagon of the NATO 0:14:19.080 --> 0:14:22.160 is about an hour south in a small town called Mons. 0:14:22.200 --> 0:14:25.760 That access from Brussels to Mons is the heart of NATO. 0:14:25.880 --> 0:14:28.880 So you get the pointed. Is the leader the commander 0:14:28.880 --> 0:14:31.920 of NATO? The brass is shined. What happens when you 0:14:31.960 --> 0:14:35.920 walk in the door. Is an American running NATO as 0:14:35.920 --> 0:14:38.640 the supreme Allied commander. You ought to remember you are 0:14:38.680 --> 0:14:41.600 an American, but your deputy is a brit Your chief 0:14:41.600 --> 0:14:44.400 of staff is a German, your deputy chief of staff 0:14:44.520 --> 0:14:48.440 is French. All twenty eight countries have senior positions across 0:14:48.520 --> 0:14:53.000 the Alliance. So there's American leadership, but it's not American 0:14:53.120 --> 0:14:55.840 direction or American hegena. What does Mr Trump want? How 0:14:55.840 --> 0:14:58.720 do you synthesize the comments of the last fourteen days 0:14:59.000 --> 0:15:00.520 You've been out in the me you but I want 0:15:00.560 --> 0:15:04.480 you to say for the surveillance audience now, is NATO ancient? 0:15:04.680 --> 0:15:07.600 Is it an artifact? Not at all? And I spent 0:15:07.720 --> 0:15:10.600 about an hour with President elect Trump and Trump Tower 0:15:10.720 --> 0:15:14.440 on December eighth, so just a few weeks ago, and 0:15:14.560 --> 0:15:17.000 I made the case and I think he accepted it 0:15:17.040 --> 0:15:21.800 to a reasonable degree, that NATO is good return on investment. 0:15:21.880 --> 0:15:25.440 As Bloomberg listeners would think of it as follows. US 0:15:25.480 --> 0:15:29.440 spend six billion a year, China spends a hundred and 0:15:29.480 --> 0:15:32.240 fifty billion a year, Russia spends eighty billion a year. 0:15:32.600 --> 0:15:35.680 But the rest of NATO, European NATO tom spends three 0:15:35.800 --> 0:15:39.200 hundred billion dollars a year, more than Russia and China combined. 0:15:39.560 --> 0:15:41.360 We would not want to walk away and leave that 0:15:41.440 --> 0:15:44.680 money on the table. It's a good investment. Yesterday, the 0:15:44.760 --> 0:15:47.720 Vice President Joe Biden delivered a speech in Davos calling 0:15:47.720 --> 0:15:49.880 on the preservation of the Liberal order, talking about the 0:15:49.920 --> 0:15:53.280 relationship between the US and Europe, a very passionate speech 0:15:53.320 --> 0:15:55.960 about the importance of that relationship. Do you get the 0:15:56.000 --> 0:15:57.560 sense that we're going to hear the same kind of 0:15:57.560 --> 0:16:01.920 passion from this next administration. I think that's not likely, 0:16:02.360 --> 0:16:04.800 but I do think there's a kind of a grudging 0:16:04.960 --> 0:16:08.800 respect by President Trump. He actually said to me, as 0:16:08.840 --> 0:16:11.080 he said at the tail end of his NATO is 0:16:11.120 --> 0:16:15.280 obsolete comments, that NATO is very important to the United States. 0:16:15.520 --> 0:16:18.200 He understands that. And I'll tell you who really understands 0:16:18.240 --> 0:16:22.120 it is General Jim Maddis, who is the new Secretary 0:16:22.160 --> 0:16:25.800 of Defense designate, assuming he's confirmed. He will be a 0:16:25.920 --> 0:16:28.840 very strong advocate for NATO. He's saying during his hearing, 0:16:28.880 --> 0:16:30.800 if we did not have NATO today, we'd need to 0:16:30.840 --> 0:16:33.040 create it, I believe. Let me ask you about something 0:16:33.080 --> 0:16:35.000 we heard a few moments ago. Jonathan Bernstein, one of 0:16:35.000 --> 0:16:38.240 our bloom Review commentators, talking about how many jobs are 0:16:38.320 --> 0:16:40.160 yet to be filled and watched in DC. There have 0:16:40.200 --> 0:16:43.040 been reports of how in the national security space in particularly, 0:16:43.040 --> 0:16:44.520 there are a lot of jobs that haven't been filled. 0:16:44.560 --> 0:16:46.240 How worried about that are you? How worried are you 0:16:46.240 --> 0:16:49.040 about how this transition has been proceeding, especially when it 0:16:49.080 --> 0:16:51.360 comes to filling jobs in the Pentagon and the State Department, 0:16:51.400 --> 0:16:54.680 the National Security Council. Let's say I'm concerned, but I 0:16:54.720 --> 0:16:57.560 haven't quite hit the point of deep worry as yet. 0:16:57.680 --> 0:17:00.200 Let's give him about another month. If they don't start 0:17:00.000 --> 0:17:04.399 at filling those second and third tier jobs, particularly at Defense, 0:17:04.640 --> 0:17:07.400 State and the NSC staff, then I think it's time 0:17:07.440 --> 0:17:09.239 to worry. David. I want you to jump in here, 0:17:09.280 --> 0:17:10.959 but I've got to cut in and and make this 0:17:11.000 --> 0:17:13.840 is such an important question. Do you have any indication 0:17:13.920 --> 0:17:17.719 that oldline Republican foreign policy people want to work for 0:17:17.720 --> 0:17:21.240 this administration. I think they are willing to do so, 0:17:21.320 --> 0:17:23.879 and I think that maybe part of what's at delay 0:17:24.000 --> 0:17:29.320 here is the Trump transition team is obviously cognizant of 0:17:29.359 --> 0:17:33.640 people who signed petitions never Trump, or if people were 0:17:34.480 --> 0:17:37.359 unsupportive of Trump but maybe didn't go as far as 0:17:37.400 --> 0:17:40.640 signing the petition, etcetera, etcetera. So there's a little bit 0:17:40.680 --> 0:17:43.639 more I would say, internal vetting going on Tom and 0:17:43.680 --> 0:17:45.840 that's probably slowed it down a bit. I'm sure there's 0:17:45.880 --> 0:17:48.200 an old home quality to going to the World Economic 0:17:48.200 --> 0:17:50.119 for manual meeting. You're probably running into people that you 0:17:50.160 --> 0:17:52.639 knew from your tour of duty as the Supreme Allied 0:17:52.640 --> 0:17:55.280 Commander of NATO. What are they saying to you about 0:17:55.320 --> 0:17:57.680 the the alliance there? You don't have to name names, 0:17:57.720 --> 0:18:00.639 but generally speaking, what's the tone, what's the temperature of 0:18:00.680 --> 0:18:03.560 their sense of of of the strength of that relationship. 0:18:03.640 --> 0:18:07.280 Right now, I would categorize it as very hopeful on 0:18:07.320 --> 0:18:11.080 the European side that we will see continued strong US 0:18:11.160 --> 0:18:14.440 support in the alliance. And I did a panel here 0:18:14.480 --> 0:18:18.399 on the future of the Transatlantic Alliance and the question 0:18:18.480 --> 0:18:21.480 was is the Alliance at a tipping point? And my 0:18:21.560 --> 0:18:24.359 answer is no, but we might be at a slipping point. 0:18:24.400 --> 0:18:26.200 In other words, I don't think it's gonna fall over 0:18:26.240 --> 0:18:29.080 and collapse, but we need to be careful that it 0:18:29.119 --> 0:18:33.240 doesn't slip down in importance. We're all gonna know more 0:18:33.520 --> 0:18:35.840 in about six months when we see the first set 0:18:35.880 --> 0:18:39.560 of policy positions that the new administration takes. I think 0:18:39.760 --> 0:18:42.359 a theme to our conversations this week has been about 0:18:42.359 --> 0:18:45.320 the future of multilateralism, and I'll ask you who's going 0:18:45.400 --> 0:18:47.000 to make the case for that going forward. I think 0:18:47.040 --> 0:18:49.720 you have a lot of people who are disillusioned with multilateralism. 0:18:49.920 --> 0:18:52.320 There is a tendency now to look more inward than 0:18:52.359 --> 0:18:54.320 we have in the past. Who's going to take up 0:18:54.320 --> 0:18:56.320 the mantle, who's going to make the case for multiladeralism 0:18:56.400 --> 0:19:00.880 going forward. Well, I'm hoping, despite some rhetoric coming out 0:19:00.880 --> 0:19:03.320 of Washington, that the US will continue to do that 0:19:03.359 --> 0:19:06.120 because it's fundamentally in our interest. But I think two 0:19:06.119 --> 0:19:08.679 other nations that come to mind, one in Europe and 0:19:08.680 --> 0:19:12.400 one in Asia are Germany and Japan. And it's interesting 0:19:12.440 --> 0:19:15.800 to note that these are both not quite superpowers but 0:19:15.960 --> 0:19:21.160 certainly uh well established players in the international field who 0:19:21.200 --> 0:19:25.280 are emerging into the geopolitical world. Both of those leaders, 0:19:25.440 --> 0:19:30.160 Shinzo Abe and Angela Merkel, talk a great deal about multilateralism. 0:19:30.200 --> 0:19:33.120 And then I don't think we can completely overlook President 0:19:33.160 --> 0:19:37.040 g who came here and effectively signed up to multilateralism 0:19:37.200 --> 0:19:40.160 as the foundational piece of the world order. But critically, 0:19:40.320 --> 0:19:44.119 if he came here and addressed multilateralism, can that be 0:19:44.280 --> 0:19:50.720 affected with a communist society. Well that's the billion dollar question, Tom, 0:19:50.840 --> 0:19:54.840 and I think that my own view is that China 0:19:54.920 --> 0:19:58.919 can be a multilateral actor, that they can participate in 0:19:59.000 --> 0:20:02.959 all of these Internet sational forums despite having an internal 0:20:03.000 --> 0:20:09.439 political system that is one of communists as a base philosophy. 0:20:09.480 --> 0:20:12.480 But we like to say in the United States politics 0:20:12.600 --> 0:20:15.359 ends at the water line. Perhaps that will be the 0:20:15.359 --> 0:20:18.639 approach from China. Did it end of the waterline in Wisconsin? 0:20:18.720 --> 0:20:21.919 The main Mr Trump was elected by a body of 0:20:22.000 --> 0:20:26.880 people who are distrustful of domestic China. In the application 0:20:27.440 --> 0:20:30.879 I would suggest Asian particularly to the United States. I 0:20:30.960 --> 0:20:34.640 agree with all that. And in addition, there is enormous 0:20:34.800 --> 0:20:38.120 Middle East fatigue in the United States. So I think 0:20:38.119 --> 0:20:42.520 those are the twin pillars of challenge for the Trump administration. 0:20:43.200 --> 0:20:45.960 How do you square the circle with China without breaking 0:20:46.000 --> 0:20:48.720 the global economy with a trade war? And how do 0:20:48.760 --> 0:20:52.440 you take a leadership position in this very fractious Middle 0:20:52.480 --> 0:20:55.480 East despite enormous fatigue in our country. David jumping here 0:20:55.480 --> 0:20:57.320 with the one more question with animals to Venus because 0:20:57.320 --> 0:21:00.000 they had a navy question. Just a quick question about 0:21:00.040 --> 0:21:01.960 this transition and how different it is from the ones 0:21:02.000 --> 0:21:03.719 that we've seen in the past. You have a lot 0:21:03.720 --> 0:21:05.119 of positions that are can go un filled. We read 0:21:05.160 --> 0:21:07.720 the stories about how ambassadors are being pulled back. There's 0:21:07.720 --> 0:21:09.919 not going to be any continuity there until the replacements 0:21:10.040 --> 0:21:11.800 are found. Is there a risk there and having such 0:21:11.800 --> 0:21:14.359 a clean break to you understand why the president elect 0:21:14.440 --> 0:21:18.240 is doing that. I think there is risk in the timing. 0:21:18.520 --> 0:21:22.919 Every president, in every administration has every right to withdraw 0:21:23.040 --> 0:21:26.720 the old and in place the new. But the sooner 0:21:26.760 --> 0:21:30.400 that happens in national security, the better, because the whole 0:21:30.440 --> 0:21:33.879 world is kind of waiting on pause, and the longer 0:21:33.960 --> 0:21:36.200 you wait, the greater the spread of risk. And now 0:21:36.280 --> 0:21:40.120 almost vitus. It is a first Bloomberg surveillance that we're 0:21:40.160 --> 0:21:43.359 honored that you were us. He's out of uniform today, folks, 0:21:43.359 --> 0:21:46.920 he's styling in the Patagonias silver vest in the bright 0:21:46.960 --> 0:21:50.600 pink tie. Uh, Admiral, have you ever visited with a 0:21:50.680 --> 0:21:55.679 Swiss navy They have They have aquarious class patrol boats 0:21:55.960 --> 0:21:59.359 Type A D that are actually a serious flotilla of 0:21:59.400 --> 0:22:03.640 their lake bordering other nations. I have been aboard the 0:22:03.680 --> 0:22:08.480 Swiss Navy craft in Lake Geneva with Lieutenant General Andre Blautman, 0:22:08.840 --> 0:22:11.760 the chief in Defense of Switzerland. I have nothing but 0:22:11.880 --> 0:22:14.640 admiration for the Swiss military. And here's another one time. 0:22:15.040 --> 0:22:19.240 Did you know that the Swiss military has a bicycle regiment. 0:22:19.920 --> 0:22:26.240 They have some unique features. No, but this is from 0:22:26.359 --> 0:22:29.480 from before World War Two. There exact clara here it 0:22:29.640 --> 0:22:34.760 is and as universal conscription terrific. Must thank you so 0:22:34.840 --> 0:22:47.320 much for the clinic on the Swiss Navy, brought you 0:22:47.400 --> 0:22:51.000 by Bank of America. Mary Lynch. Dedicated to bringing our 0:22:51.080 --> 0:22:54.679 clients insights and solutions to meet the challenges of a 0:22:54.720 --> 0:22:59.080 transforming world. That's the power of global connections, Mary Lynch, 0:22:59.240 --> 0:23:03.560 Pierce feder In Smith Incorporated, Member s I p Z. 0:23:07.520 --> 0:23:11.240 It is an important interview in Davos with someone from Laffyette, Indiana, 0:23:11.280 --> 0:23:13.800 who demanded he would not come on surveillance till the 0:23:13.840 --> 0:23:17.720 Cubs won the World Series. So finally we welcome Christopher 0:23:17.720 --> 0:23:20.959 Ice Gruber. He was the twentieth president of a college 0:23:20.960 --> 0:23:25.440 in New Jersey called Princeton University, and all celebrated upon 0:23:25.720 --> 0:23:31.280 his UH sainthood here because of the path he has 0:23:31.320 --> 0:23:35.080 taken as an undergraduate at Princeton, including a Rhodes scholar 0:23:35.200 --> 0:23:39.680 working at Chicago Law and ample career UH and teaching 0:23:39.920 --> 0:23:43.359 of the law. The real reason that Dr Ice Gruber 0:23:43.440 --> 0:23:47.199 is here today is reported by Kristin tout Uh Kristen 0:23:47.280 --> 0:23:50.480