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Speaker 1: This is the Bloomberg Surveillance Podcast.

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Speaker 2: I'm Tom Keene, along with Jonathan Farrow and Lisa Abramowitz.

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Speaker 2: Join us each day for insight from the best an economics, geopolitics,

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Speaker 2: finance and investment. Subscribe to Bloomberg Surveillance on demand on Apple,

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Speaker 2: Spotify and anywhere you get your podcasts, and always on

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Speaker 2: Bloomberg dot Com, the Bloomberg Terminal and the Bloomberg Business app.

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Speaker 2: Where are Boeing Aircraft made? I believe it's Renton, Washington

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Speaker 2: where they were tuned into the college football game here

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Speaker 2: a while back. The seven thirty seven comes out of Reton, Washington.

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Speaker 2: An expert on that is Sheila Kiglu, senior equity research

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Speaker 2: analyst at Jeffreys and joins us this morning. Have you

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Speaker 2: been to Reton, Washington?

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Speaker 1: I have.

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Speaker 3: There's three production lines.

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Speaker 4: The third one just opened up, so if you think

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Speaker 4: about it, each one of those turns out fifteen to

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Speaker 4: seventeen max's per month. The fourth one will open next

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Speaker 4: year and ever at about an hour and a half

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Speaker 4: away from Renton.

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Speaker 2: So I want you to speak and I don't want

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Speaker 2: you to talk about all your leverage finance work at

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Speaker 2: JP Morgan and your wonderful work at Jefferys, your award

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Speaker 2: winning work and institutional investor.

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Speaker 1: Forget about it.

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Speaker 2: Our listeners and viewers want to know where's the problem

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Speaker 2: and is it easy to fix? Is it rent in

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Speaker 2: Washington or is it the fuselage riveters in Kansas.

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Speaker 4: I think the problem is the pandemic deteriorated their aerospace

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Speaker 4: workforce not so much. And I mean the problem is

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Speaker 4: in Renton, not only at the Boeing factory, but the

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Speaker 4: small Tier three, Tier four suppliers around there. They're seeing

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Speaker 4: strain on their workforce. The problem has been really focused

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Speaker 4: over the last year in Spirit in Wichita, with three

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Speaker 4: incidents either on the Max or the eight to seven

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Speaker 4: involving quality issues.

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Speaker 3: So there's been management changes there.

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Speaker 4: To address those quality issues, and I think that's really

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Speaker 4: the focus item. Given we've seen small improvements in the

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Speaker 4: engine manufacturers and the Tier three.

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Speaker 5: This sounds absolutely shocking when I start to hear about this,

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Speaker 5: At least for ask this question earlier in the week.

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Speaker 5: I'd love your response to it. Are we suggesting that

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Speaker 5: things are safe but not as safe as they were

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Speaker 5: before the pandemic?

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Speaker 4: Now in this industry, I think the industry is having

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Speaker 4: a tough time recruit you know, getting back up to

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Speaker 4: post pandemic levels, and you know we're manufacturing.

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Speaker 3: In September, we were only manufacturing.

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Speaker 4: In the teens a month on these max is when

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Speaker 4: we were supposed to be at thirty eight a month.

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Speaker 4: So we essentially, you know, in December deliveries were forty four.

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Speaker 4: Half of that was out of inventory, half of it.

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Speaker 3: Was actual production.

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Speaker 4: So we basically doubled output in three months, right, we

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Speaker 4: were trying to double output. So there's a stream, given

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Speaker 4: air traffic is back to one hundred percent of twenty

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Speaker 4: nineteen levels, to get this aircraft production back, and it

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Speaker 4: was very constrained over the last three years.

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Speaker 5: You've now did demand at Boeing isn't the problem, it's deliveries.

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Speaker 5: We had Ryan as Michael O'Leary sit in your seat

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Speaker 5: actually at the end of last year, complaining about the

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Speaker 5: delays to the seven thirty seven max getting delivered to

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Speaker 5: Ryanair how Osawi to further delays and ultimately canceled orders

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Speaker 5: because of what's tanking place.

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Speaker 3: I'm sure he was more entertaining than me, and this seat,

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Speaker 3: I will.

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Speaker 5: Tell you that he's more entertaining than I Am, don't

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Speaker 5: worry about it.

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Speaker 4: You know, what we've seen is that we've seen a

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Speaker 4: delivery slip. We delivered about one thousand aircraft in twenty two.

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Speaker 4: That number was fifteen hundred post pandemic on the narrow body.

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Speaker 4: So we've seen that happen already. But we're not going

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Speaker 4: to see cancelations. We're seeing the order brook stretch out

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Speaker 4: twenty eight twenty nine. Everybody wants to get in line,

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Speaker 4: and even Ryanair, who's been the most outspoken against Boeing,

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Speaker 4: has talked about wanting that aircraft sooner and pricing being

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Speaker 4: better for them, Pricing being better for Boeing on some

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Speaker 4: of the Ryan Air aircraft because they want the aircraft sooner.

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Speaker 2: What's the opportunity here for Airbus? I mean, I mean

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Speaker 2: just as simple and tou luise I got to play

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Speaker 2: this low. It could be them. I get the whole dance.

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Speaker 2: But is this a huge strategic opportunity in the United

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Speaker 2: States of America for unit sales for Airbus?

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Speaker 3: Not so much.

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Speaker 4: I think the opportunity was from twenty nineteen to twenty

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Speaker 4: three twenty two, when the Max was essentially grounded, not

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Speaker 4: delivering to China as well, where we're forgetting about that

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Speaker 4: China element.

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Speaker 3: But Airbus had their market share opportunity.

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Speaker 4: So what we see in twenty five as Boeing produces

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Speaker 4: fifty max is a month and Airbus does seventy five

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Speaker 4: maybe in the twenty twenty six time frame is more

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Speaker 4: likely to be honest. So they already have that market

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Speaker 4: share game. And let's not for Yes, Airbus has its

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Speaker 4: own issues. The Airbus aircraft is mad has two engine options,

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Speaker 4: either the ge leap option and the Raithyon GTF option.

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Speaker 4: We know the GTF has a contaminated powder in it,

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Speaker 4: so they're basically grounding forty percent of the GTF engines

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Speaker 4: in the first half of this year to do inspections

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Speaker 4: on them. So Airbus is not short of its issues

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Speaker 4: as well.

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Speaker 1: Okay, some of this is.

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Speaker 2: The complexity of the engineering across all of aviation. Are

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Speaker 2: we at a point now and then, I mean, I

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Speaker 2: get the COVID idea. I think that's brilliant, But are

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Speaker 2: we at a point where these things are becoming too complex?

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Speaker 4: Some areg you, it's not complex enough, not enough fuel efficiency,

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Speaker 4: not enough energy efficiency, two pilots to by the plane.

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Speaker 4: So I think that what we've seen in the aircraft

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Speaker 4: industry is no new models really, this is the twenty

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Speaker 4: twenties are just an upgrade of the existing models and efficiency.

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Speaker 2: Are they still trying to do a one pilot plane.

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Speaker 3: I think that's off the books for now.

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Speaker 4: The focus has really been on the engine, the fuel efficiency,

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Speaker 4: and what kind of engine we get in the twenty

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Speaker 4: thirty five twenty forty time frame and how that aircraft

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Speaker 4: takes us over the next two to three decades.

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Speaker 2: The sitting of the jet back and forth on the

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Speaker 2: wing was due to fuel efficiency, right, should we jettison?

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Speaker 2: Fuel efficiency is an engineering mandate, that's what we're aiming for.

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Speaker 4: But clearly the engine OEMs have had a lot of trouble,

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Speaker 4: not only in production but the efficiency that they're getting.

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Speaker 4: So not calling out GTF only with the raytheon issues.

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Speaker 4: Not only do they have the contaminated powder, they've needed

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Speaker 4: to do upgrades to get their engine.

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Speaker 3: Up to par so is leaps. So that's what we're

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Speaker 3: calling fence building.

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Speaker 5: Let's finish on the regulator. This is a difficult one.

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Speaker 5: How do you expect the regulator to respond to this?

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Speaker 5: How do authority step in here? Given what could have

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Speaker 5: taken place on Friday.

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Speaker 4: So, John, you started off very stark contrast with Dave

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Speaker 4: Calhoun yesterday, and I think the regulators took that same message.

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Speaker 4: NTSP is solely focused on the accident. Well, no, in

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Speaker 4: twelve to eighteen months, what really happened? The FAA said

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Speaker 4: Grounding twelve hours in, so did Yassa. So I think

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Speaker 4: that they're taking a stark stance. Boeing has this directive

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Speaker 4: out on how to inspect the aircraft, and I think

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Speaker 4: we could see the aircraft back in the air by

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Speaker 4: the end.

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Speaker 3: Of next week.

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Speaker 5: The end of next week. That quickly.

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Speaker 4: The directive said four to eight hours to inspect the aircraft.

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Speaker 4: You think about just the pr element of it. An

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Speaker 4: extra week.

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Speaker 5: When you hear from the regulator. Of course, they have

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Speaker 5: to start out really broad, actually have all options open,

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Speaker 5: t K consider everything, Shila. Do you get the sense

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Speaker 5: that they've narrowed this investigation down already? Then, given your expectation,

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Speaker 5: we'll be back up in the air next week.

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Speaker 4: So the NTSP, I think, will take a year to

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Speaker 4: come to a conclusion on exactly what happened and what

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Speaker 4: the cause was. But the FAA seems pretty confident that

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Speaker 4: the directive came out so quickly.

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Speaker 2: Thirty seconds normal conversation. What's your single best.

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Speaker 1: Buy right now?

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Speaker 4: Oh, this amazing company called Higo. When I started covering

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Speaker 4: it's called Hiko.

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Speaker 1: Hiko.

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Speaker 4: Yes, twenty one billion market cap fifty one times PE.

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Speaker 4: But when I first started covering this stock, and I

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Speaker 4: won't tell you when that was, the market cap was

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Speaker 4: two billion dollars. They are a generic aircraft parts manufacturer

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Speaker 4: and they supply the aftermarket. The more we don't get

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Speaker 4: new aircraft deliveries, the more Hiko benefits because the old

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Speaker 4: planes get serviced.

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Speaker 5: Interesting. I thought we could have rund out that conversation

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Speaker 5: sort of long bowing, but we didn't. Shada, thank you,

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Speaker 5: it's good to hear.

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Speaker 1: Free me.

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Speaker 5: Just fantastic, real depth to that conversation. Shada kyli that

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Speaker 5: of Jeffreys. Let's catch out with say Mishap the chief

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Speaker 5: club was strategistic principal asset man wish and seem pleased

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Speaker 5: to say joined us right now. Seem a greater catch

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Speaker 5: up two part story this year for you, first half,

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Speaker 5: second half, first half, volatility, second half rally. I have

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Speaker 5: to say it reminds me of some of the outlooks

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Speaker 5: that I got last year for twenty twenty three, saying,

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Speaker 5: what is it about twenty twenty four where you think

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Speaker 5: that story could actually take place?

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Speaker 6: So I think that Look, if you think about where

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Speaker 6: we were at the end of last year, where you

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Speaker 6: had I think a price per perfection, you know you

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Speaker 6: couldn't get better news in the idea that the FED

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Speaker 6: would start cutting it early in this year. You would

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Speaker 6: have a soft landing, et cetera. Now, I'm not saying

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Speaker 6: that that's not all going to come true, but at

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Speaker 6: the beginning of this year, you're already seeing the market

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Speaker 6: push back on some of those original expectations about early

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Speaker 6: FED cuts. You're seeing ecod basilience that is creating a wobble,

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Speaker 6: and I struggled to see what is going to be

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Speaker 6: the catalyst to drive another leg up in the near term.

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Speaker 6: Yourys need to see a bit of a pullback as

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Speaker 6: the market starts to question their raid expectations. And then

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Speaker 6: as you get towards the middle of the year and

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Speaker 6: you get closer to that actual rate cut date, you

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Speaker 6: see an economics slow down, but it doesn't turn out

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Speaker 6: to be too damaging. That to me is that greed

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Speaker 6: signal four and a more prolonged rally.

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Speaker 2: Yes, seem a dovetail nominal GDP. Now that combination of

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Speaker 2: real GDP plus the inflation with the IMS call of

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Speaker 2: a beleaguered, slow global economy out four years to twenty

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Speaker 2: twenty eight, where are we in that continuum as we

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Speaker 2: go into twenty twenty four? Is there an animal spirit

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Speaker 2: within our nominal GDP or is it going to drift away?

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Speaker 6: So, look, we are anticipating a bit of a global

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Speaker 6: growth slowdown. You know, if you look across the US, Europe, China,

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Speaker 6: it's not particularly exciting, but you do have a couple

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Speaker 6: of bright spots around the globe. But we're not anticipating

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Speaker 6: a very prolonged economic weakness. So I think this is

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Speaker 6: a fairly decent nominal growth environment. But along with that

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Speaker 6: comes the idea that we don't necessarily see inflation coming

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Speaker 6: all the way back down to two below two percent

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Speaker 6: like you saw in previous years. So from a real rate,

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Speaker 6: which I know you've been focused on, it is a

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Speaker 6: slightly more challenging environment than we've seen in previous years,

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Speaker 6: and I think investors need to start taking that into

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Speaker 6: consideration as they're starting to position their portfolios.

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Speaker 2: What does the real rate do this year the ten

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Speaker 2: year inflation adjusted rate in the United States.

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Speaker 6: So we're expected to come down slightly, but not too much.

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Speaker 6: If I give you an idea, you know, we're expecting

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Speaker 6: the FED to color three times twenty five basis points

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Speaker 6: each time, so it's not very significant. We are expecting

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Speaker 6: inflation to come down to around the two point four

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Speaker 6: percent level, so it's not too far from where we

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Speaker 6: are today. That is a little bit still quite restrictive,

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Speaker 6: so you're not in a fantastic environment for risk assets,

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Speaker 6: but there is a lot of cyclical factors that we

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Speaker 6: can take into consideration. It's just if you're thinking about

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Speaker 6: your portfolio, you're looking at a higher cost of capital

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Speaker 6: than you've had in the last decade or so, so

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Speaker 6: you need to be kind of screening your stocks a

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Speaker 6: little bit closer. You need to be start thinking a

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Speaker 6: little bit more about bonds as well. You know, in

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Speaker 6: terms of it's great in inflationary, it's or in a

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Speaker 6: disinflationary scenario. But in an inflationary scenario where inflation doesn't

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Speaker 6: come all the way back down to what maybe was

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Speaker 6: accustomed to before, bonds don't necessarily perform as well as

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Speaker 6: you would have expected.

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Speaker 5: I wonder what your call is then on consumer discretionary.

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Speaker 5: I'll share with you what we heard from Lori Cavasina

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Speaker 5: of RBC overnight, greating discretionary to market way and saying this, Seema,

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Speaker 5: We're wary of being underweight going forward, given the tendency

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Speaker 5: of this sector to outperform when interest rates are falling.

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Speaker 5: They're two sectors at the moment that are kind of

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Speaker 5: leading the pact to close out last year. And whenever

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Speaker 5: we rally, it's discretionary, it's tech. Where are you on

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Speaker 5: the format and for that matter, where are you on

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Speaker 5: the latter.

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Speaker 6: So actually on the consumer discretioning, I'm not too negative.

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Speaker 6: I do think there are challenges coming for consumers, but

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Speaker 6: I don't think there is significant as maybe a lot

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Speaker 6: of people, including myself, were worried about at the end

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Speaker 6: of last year. There's just a lot going for consumers

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Speaker 6: at the moment. I mean, as long as the labor

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Speaker 6: market is holding up as strong as it is, and

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Speaker 6: I think consuming discretion can do well. On the tech side,

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Speaker 6: I still have good, I guess solid expectations for tech.

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Speaker 6: I do worry though about whether the expectations from the

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Speaker 6: market is going to be fulfilled. So whereas I wouldn't

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Speaker 6: want to go negative or underweight technology, I think there

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Speaker 6: are other parts of the market which are a little

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Speaker 6: bit more interesting for twenty twenty four. If, as you said,

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Speaker 6: you're going to see FED cuts and soft learning, I

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Speaker 6: think there are other parts of the market can do well.

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Speaker 5: We'll talk to me about the other parts. Then what's

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Speaker 5: the big call for you? Banks? Where do they fit in?

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Speaker 5: Give me we get earnings on Friday.

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Speaker 6: I think banks can do pretty well. I think you know,

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Speaker 6: as you're going to see in a lot of parts

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Speaker 6: of the market, there are headwinds in the first half

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Speaker 6: of the year, but as you get through to the

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Speaker 6: second then I think banks can do well. The other

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Speaker 6: part of the market, which I think should be gaining interest,

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Speaker 6: there's going to be a bit of a warble in

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Speaker 6: the first quarter at least bit small caps, I think

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Speaker 6: the evaluations are very attractive. Typically, when you get a

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Speaker 6: fed cutting cycle and it's accompanied by a kind of

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Speaker 6: a return to or at least solid growth, that is

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Speaker 6: typically a very good signal for small caps. And when

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Speaker 6: you're looking at that valuation gap between the large and

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Speaker 6: the small cup, it is very attractive so I think

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Speaker 6: this is the time that investors start thinking about it

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Speaker 6: and maybe edging into those positions.

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Speaker 2: If youels come down, is the is the flow of

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Speaker 2: money out of money market funds it's assumed. Is it

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Speaker 2: linear or does it all come in one great surge.

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Speaker 6: I think that's it's really difficult to say in terms

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Speaker 6: of how the investors sentiment is going to go. What

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Speaker 6: I do think though, is one is that those money

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Speaker 6: market funds, they do have the potential to create a

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Speaker 6: pretty strong rally once some of the questions that investors

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Speaker 6: have hanging over them are answered. So those questions would

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Speaker 6: include when is the going to start reducing interest rates?

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Speaker 6: And the second thing is is there could be an

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Speaker 6: economic slow down? And if there is an economic slow down,

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Speaker 6: how devastating is it going to be. I think all

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Speaker 6: three of those questions are going to be answered fairly

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Speaker 6: from in a positive tilt in that there's a slowdown,

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Speaker 6: but it's not too devastating at all. And I think

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Speaker 6: once you have some of these questions answered, then money

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Speaker 6: market funds that trickle is going to move towards those

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Speaker 6: risk acids, which is one of the reason do you

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Speaker 6: think investors should be positioning for a stronger second half

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Speaker 6: of the year.

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Speaker 5: Russ Coastrick at Black Crog said something similar in Raka

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Speaker 5: Semath thank you. Going to hear from your Sam a

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Speaker 5: Chant of Principal Asset Management.

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Speaker 1: Right now to.

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Speaker 2: Further discussion and the American economy. Kathleen bus Johnson joins

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Speaker 2: his chief economists Nationwide Mutual Insurance. Kathy, what's the state

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Speaker 2: of the consumer?

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Speaker 7: Good morning, Tom and John Happy to be with you. Well,

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Speaker 7: the consumer has been really resilient and not really reflective

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Speaker 7: of the labor market continue to be quite strong. We've

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Speaker 7: got employment growth that continues to kind of outpace the

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Speaker 7: monthly estimates, and wage growth continues to be buoyant. So

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Speaker 7: you know, put that together, you still have you know,

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Speaker 7: income wherewithal of the consumer to keep spending. Now, it's

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Speaker 7: not going to be the buoyant spending that we had

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Speaker 7: in the past. You know, most much of the of

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Speaker 7: not all of the pandemic related savings has been run down.

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Speaker 7: But you know, until we see a slow down a

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Speaker 7: labor market, the consumer can continue to run Here.

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Speaker 2: The character of our wage growth is compared to a

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Speaker 2: declining inflation is something the optimist speak of.

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Speaker 1: Is it normal?

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Speaker 2: Is it a normal dynamic now or do you put

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Speaker 2: an asterisk around what that means?

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Speaker 7: It's getting more normalized. I mean wage growth. If you

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Speaker 7: look at the average earlier earnings numbers running four to one,

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Speaker 7: you know you would probably in a more normal time

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Speaker 7: see that around three and a half. So you're seeing

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Speaker 7: wage growth is still a bit you know, buoyant there,

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Speaker 7: but inflation is not back to two percent yet either.

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Speaker 7: So I think in the mix, what you're seeing is

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Speaker 7: real wage growth that is steady. You know, it's not stellar,

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Speaker 7: but it's not negative either, So you know that that

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Speaker 7: helps to you know, kind of keep the consumer buoyant.

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Speaker 7: But we do think there's some slowing underneath the headline

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Speaker 7: and employment numbers, and I do think we are going

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Speaker 7: to see The question is do we see you know,

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Speaker 7: just a soft patch in growth in the middle part

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Speaker 7: of the year, or do we get a mild recession.

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Speaker 7: We're still thinking that mild recession is possible, but you know,

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Speaker 7: certainly recognize that the data have come in stronger than

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Speaker 7: expected and that could continue.

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Speaker 5: Kathy, how would you expect John Williams, the New York

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Speaker 5: Fed President, to address some of those issues this afternoon?

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Speaker 7: Yeah, very much. Looking forward to his comments, you know,

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Speaker 7: and to put into perspective like they kind of we're

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Speaker 7: talking about ray cuts. Well not really, but you know,

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Speaker 7: and the Minute's helped us out a little bit there.

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Speaker 7: But I do think they're at an interesting time now.

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Speaker 7: I mean, in a way it's better than they thought, right,

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Speaker 7: but it's still complicated. It's better because inflation has come

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Speaker 7: down much quicker than they thought, the labor market has

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Speaker 7: been more resilient. But now that the idea is well,

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Speaker 7: it's not just about lowering inflation, but can we stabilize

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Speaker 7: the economy to avoid, you know, a harder landing. So

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Speaker 7: I'm very interested to see how he kind of threads out.

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Speaker 7: I think one message you'll probably deliver is the bond

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Speaker 7: market is still a little too optimistic in the start

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Speaker 7: of the timing of rate cuts. But to be honest,

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Speaker 7: we're looking for May May June market sort of pricing

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Speaker 7: and high odds and marks not all that different. The

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Speaker 7: fact is the Fed's is going to be cutting rates

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Speaker 7: this year unless something on inflation starts to turn around

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Speaker 7: in a very ugly way.

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Speaker 5: Well, Kathy, not all rate cuts are created equally, and

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Speaker 5: I think that on the surface, it's almost contradictory to

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Speaker 5: talk about maintaining a restrictive stance and entertain the surgical

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Speaker 5: rate cuts at the same time with a focus on

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Speaker 5: real yields. Do you think they can entertain both iteas

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Speaker 5: simultaneously and communicate effectively and clearly.

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Speaker 7: Well, communication has not been there, you know, the top

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Speaker 7: bright spot here really to be honest, you know they

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Speaker 7: need to communicate clearly. But I you also think your

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Speaker 7: point is well taken. Are you just removing some of

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Speaker 7: that restrictiveness but still want to hang on to it

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Speaker 7: because you're not quite one hundred percent confident infleetion's getting

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Speaker 7: back to two percent? Or do you say, you know

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Speaker 7: what inflation? We do have a high degree of confidence.

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Speaker 7: You're getting to the point with you know Mike's interview

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Speaker 7: with Lorettemester. You know how confident they are we're going

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Speaker 7: back to two percent? And how does that real rate,

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Speaker 7: you know, play in to the mix of things, because

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Speaker 7: right now the real rate is higher.

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Speaker 2: Right the fact that it can't in Columbus, Ohio nationwide

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Speaker 2: is on your side, and all that the unemployment rate

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Speaker 2: is two point eight zero percent. Help me with Senator

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Speaker 2: Warren from the Commonwealth of Massachusetts. Shouldn't we be up

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Speaker 2: on the tables pop and champagne and celebrating an unemployment

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Speaker 2: rate of two point eight zero percent.

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Speaker 7: Yes, I mean we should be celebrating that this economy

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Speaker 7: is is quite good, and you know, inflation is coming down.

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Speaker 7: You know, maybe that is why consumers overall and maybe

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Speaker 7: there's not as much exuberance out there, but inflation's coming

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Speaker 7: down eventually. If it's going to be cutting interest rates

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Speaker 7: at some point this year, you know, that's that's a

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Speaker 7: very positive mix. And to your point, and employment rate

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Speaker 7: certain parts of the country, like Columbus, very very low

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Speaker 7: and very positive. So I think we need to applaud

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Speaker 7: a lot of that, and that sort of gets overshadowed

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Speaker 7: by all of our concerns.

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Speaker 5: Kathy, just quickly, where do you have unemployment your end?

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Speaker 7: Yes, so we see the unemployment rate drifting a bit higher,

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Speaker 7: but because we have a mild recession, it doesn't even

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Speaker 7: get above five percent. So you're looking at something around

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Speaker 7: four point seven percent or so at the high so

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Speaker 7: let some of the air out of the economy, but

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Speaker 7: certainly does not crush the labor market.

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Speaker 5: Interesting, Kathy, Thank you appreciate the insight. Kathy Chance it

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Speaker 5: that of nationwide.

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Speaker 2: Matthew Bartland knows each and every ward in Nashua, New Hampshire.

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Speaker 2: He is hardcore in New Hampshire. Enjoins us this morning

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Speaker 2: Darby Field Advisors, a Republican strategist with service in the

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Speaker 2: Trump administration until a certain January date. I got to

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Speaker 2: go there first, Matthew, as you joined surveillance for the

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Speaker 2: first time. What was it like on January sixth when

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Speaker 2: you said, Sea.

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Speaker 1: Yeah, you know, thanks Tom. Listen.

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Speaker 8: It was a very very hard day here in this

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Speaker 8: town in Washington, and I remember walking home it was

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Speaker 8: during COVID and crossing the Capitol and just seeing the

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Speaker 8: utter mayhem and feeling utter discussed and made what was

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Speaker 8: just the easiest decision I've ever made my career, which was,

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Speaker 8: dear mister Secretary, I hereby resigne immediately from the State Department.

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Speaker 2: Decisions will be made in this excuse me, decisions will

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Speaker 2: be made in Hampshire, Mass Bartlet what's the tone you

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Speaker 2: see right now among Republicans?

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Speaker 8: Well, exactly, it's January, and you know the business community

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Speaker 8: that the country is looking at a lot of those

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Speaker 8: those snow covered roads right now. It's not Davos might

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Speaker 8: be Davenport, Iowa, might be dover New Hampshire. And you know,

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Speaker 8: we are looking at what is either the beginning or

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Speaker 8: maybe the end. President Trump has a significant lead. There

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Speaker 8: are really two battlegrounds right now. It's Iowa, which he

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00:21:33,359 --> 00:21:36,320
Speaker 8: may have locked up, and it's a question of expectations.

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00:21:36,720 --> 00:21:38,600
Speaker 8: And then it's over in New Hampshire, the Granite State,

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00:21:38,640 --> 00:21:41,959
Speaker 8: my home state, where Nikki Haley may be putting together

443
00:21:42,680 --> 00:21:46,399
Speaker 8: some puzzle pieces with her granite heels on climbing the

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00:21:46,440 --> 00:21:50,960
Speaker 8: mountain and may shock the Trump campaign, may shock the world.

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00:21:51,040 --> 00:21:53,040
Speaker 1: And if so, then we have a race.

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00:21:53,560 --> 00:21:56,639
Speaker 8: But if President Trump really blows it out in both states,

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00:21:56,880 --> 00:21:58,879
Speaker 8: I think this nomination might be wrapped up and wrapped

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00:21:58,920 --> 00:21:59,480
Speaker 8: up ptty quickly.

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00:21:59,520 --> 00:22:01,359
Speaker 5: Well, Matthia, talk about that. You've been on the ground

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00:22:01,440 --> 00:22:04,760
Speaker 5: with every candidate I believe in the field, Matthew, do

451
00:22:04,840 --> 00:22:07,879
Speaker 5: you see anything on the ground. It's difficult to reconcile

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00:22:07,920 --> 00:22:09,760
Speaker 5: with what we all see in the polls.

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Speaker 1: Oh sure, right now. Polls. You'll see a lot of

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00:22:14,600 --> 00:22:15,399
Speaker 1: national polls.

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00:22:15,680 --> 00:22:19,159
Speaker 8: Those poll polls are certainly, you know, lagging indicators. It

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00:22:19,240 --> 00:22:22,040
Speaker 8: is the state polls that are the leading indicators. The

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00:22:22,119 --> 00:22:24,399
Speaker 8: nomination process is not a you know, as we know,

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00:22:24,560 --> 00:22:28,440
Speaker 8: a national election, it's a state by state event, and

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00:22:28,760 --> 00:22:30,679
Speaker 8: right now in Iowa and in New.

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00:22:30,520 --> 00:22:34,000
Speaker 1: Hampshire, the race is not nationalized. Rather it's personalized.

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00:22:35,240 --> 00:22:37,840
Speaker 8: People get to go and meet the candidates upfront, hear

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00:22:37,880 --> 00:22:42,520
Speaker 8: from them directly, unfiltered from you know, free from from media,

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00:22:42,680 --> 00:22:45,840
Speaker 8: free from ads, get to ask questions, and that's really

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00:22:45,880 --> 00:22:49,320
Speaker 8: where where people can can can make their stake. And

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Speaker 8: I think that's what we see Nikki Heley do to

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00:22:51,200 --> 00:22:52,160
Speaker 8: to a very high degree.

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00:22:52,320 --> 00:22:54,400
Speaker 5: What's the number one issue that you think is attracting

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00:22:54,520 --> 00:22:56,560
Speaker 5: voters to the likes of Nicki Hailey?

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00:22:58,080 --> 00:23:01,280
Speaker 8: You know, I think it's probably a mix of policies

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00:23:01,680 --> 00:23:05,200
Speaker 8: of you know, maybe the Biden administration, whether it's foreign policy,

471
00:23:05,240 --> 00:23:10,080
Speaker 8: domestic spending, inflation that have kind of pushed people away

472
00:23:10,119 --> 00:23:12,560
Speaker 8: from you know, their vote maybe twenty twenty or away

473
00:23:12,560 --> 00:23:17,120
Speaker 8: from the Democratic Party, but more importantly looking back towards

474
00:23:17,720 --> 00:23:21,280
Speaker 8: what people see, as you know, a firmer Republican party

475
00:23:21,480 --> 00:23:23,760
Speaker 8: that maybe is absent some of them, mayhem, some of

476
00:23:23,800 --> 00:23:28,320
Speaker 8: the personality deficits that former President Trump has displayed for

477
00:23:28,320 --> 00:23:29,280
Speaker 8: the better part of a decade.

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00:23:29,280 --> 00:23:29,440
Speaker 7: Now.

479
00:23:29,560 --> 00:23:30,200
Speaker 1: Matthew Barlow.

480
00:23:30,280 --> 00:23:33,800
Speaker 2: Terry Hayes visits often from Pangaea, and he made a

481
00:23:33,880 --> 00:23:36,520
Speaker 2: common a number of months ago where he said, there's

482
00:23:36,520 --> 00:23:40,760
Speaker 2: a complete misjudgment about the number of GOP who really

483
00:23:40,880 --> 00:23:44,800
Speaker 2: aren't in love with the former president. In political Jonathan

484
00:23:44,840 --> 00:23:49,000
Speaker 2: Martin the headline where are all the anti Trump Republicans?

485
00:23:49,359 --> 00:23:50,400
Speaker 1: Where are they? Matthew?

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00:23:50,400 --> 00:23:52,639
Speaker 2: And are there any conquered New Hampshire?

487
00:23:54,000 --> 00:23:57,520
Speaker 8: Oh, certainly, you know, if you look at New Hampshire,

488
00:23:57,720 --> 00:24:01,000
Speaker 8: it is the only purple state, maybe the only swing state.

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00:24:01,080 --> 00:24:02,639
Speaker 1: In addition to being an early state.

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00:24:03,200 --> 00:24:06,560
Speaker 8: Republicans can only vote in the Republican primary, Democrats can

491
00:24:06,560 --> 00:24:09,760
Speaker 8: only vote in the Democratic primary. But independence, of which

492
00:24:09,760 --> 00:24:14,159
Speaker 8: there are more than Republicans or Democrats, can vote either one.

493
00:24:14,280 --> 00:24:17,320
Speaker 8: So right now, the independence of New Hampshire, those that

494
00:24:17,440 --> 00:24:19,879
Speaker 8: actually decide the general election are going to have a

495
00:24:19,920 --> 00:24:23,280
Speaker 8: significant role in choosing the Republican nominee, or at least

496
00:24:23,280 --> 00:24:25,760
Speaker 8: impacting that. Right now, it looks as if they are

497
00:24:25,800 --> 00:24:29,280
Speaker 8: going to Nicky Haley. There is a Trump fatigue factor.

498
00:24:29,520 --> 00:24:32,800
Speaker 8: In fact, when you go to her town halls, one

499
00:24:32,840 --> 00:24:36,360
Speaker 8: of the biggest applause lines you hear. She's quite candid,

500
00:24:36,400 --> 00:24:39,360
Speaker 8: she says, listen polling says Donald Trump might be up

501
00:24:39,840 --> 00:24:42,719
Speaker 8: one to four points on Joe Biden, but I'm up

502
00:24:42,760 --> 00:24:46,320
Speaker 8: seventeen points. So I think a lot of strong conservatives

503
00:24:46,720 --> 00:24:50,679
Speaker 8: look at that as a resounding, you know, rationale for

504
00:24:50,760 --> 00:24:54,119
Speaker 8: her candidacy, and a lot of independent voters, you know,

505
00:24:54,160 --> 00:24:55,439
Speaker 8: find her to be the Goldilocks King.

506
00:24:55,480 --> 00:24:58,960
Speaker 2: What does President Biden need to do to garner those

507
00:24:59,000 --> 00:25:02,879
Speaker 2: GOP diss affected votes. Does he need to communicate with

508
00:25:03,000 --> 00:25:04,960
Speaker 2: him like his communicating with a Pentagon.

509
00:25:07,320 --> 00:25:10,399
Speaker 8: Yeah, I think communications a good start, you know, putting

510
00:25:10,400 --> 00:25:13,200
Speaker 8: priority that you see, you hear, you listen to those

511
00:25:13,720 --> 00:25:15,760
Speaker 8: that it is a warm place. Maybe some of his

512
00:25:15,840 --> 00:25:19,200
Speaker 8: policies have been rather progressive. He's been for the past

513
00:25:19,200 --> 00:25:24,160
Speaker 8: four years really attuned to the left wing of his party. Now,

514
00:25:24,480 --> 00:25:26,320
Speaker 8: as we turn a corner into a potential you know,

515
00:25:26,640 --> 00:25:28,960
Speaker 8: general election, he really needs to make sure that that

516
00:25:29,040 --> 00:25:31,640
Speaker 8: coalition that he built in twenty twenty stays with him,

517
00:25:31,800 --> 00:25:34,280
Speaker 8: that they do not feel deflated. And that's from the

518
00:25:34,359 --> 00:25:37,480
Speaker 8: left on certain issues which may be a little more sensitive.

519
00:25:37,600 --> 00:25:40,000
Speaker 8: Maybe it's foreign policy issues as we're seeing in playout

520
00:25:40,359 --> 00:25:44,840
Speaker 8: in Michigan. But again, those disaffected voters who thought Trump,

521
00:25:45,000 --> 00:25:47,320
Speaker 8: you know, maybe they liked his policy, but they just

522
00:25:47,320 --> 00:25:50,679
Speaker 8: thought his personality was just too much. Now it's going

523
00:25:50,720 --> 00:25:53,720
Speaker 8: to be yet again a choosing time potentially between Trump

524
00:25:53,800 --> 00:25:56,680
Speaker 8: and Biden and who can swing those voters right back.

525
00:25:56,840 --> 00:25:58,960
Speaker 5: Let's get to TV programming later on the seven and

526
00:25:59,040 --> 00:26:01,200
Speaker 5: just to wrap things up math nine pm Eastern time.

527
00:26:01,240 --> 00:26:04,119
Speaker 5: I believe you've got Run versus Nicky on CNN and

528
00:26:04,119 --> 00:26:06,600
Speaker 5: then you've got the former president kind of programming on

529
00:26:06,680 --> 00:26:08,639
Speaker 5: Fox News. What's the approach from Nicky im Ron going

530
00:26:08,720 --> 00:26:11,120
Speaker 5: to be they going after each other or going after

531
00:26:11,119 --> 00:26:11,960
Speaker 5: the former president.

532
00:26:13,600 --> 00:26:16,480
Speaker 8: I mean, listen, it's gonna be both, you know, more

533
00:26:16,520 --> 00:26:20,399
Speaker 8: than anything right now, the Republican Party wants somebody with

534
00:26:20,600 --> 00:26:24,280
Speaker 8: attitude and swagger, and that is certainly why Donald Trump

535
00:26:24,400 --> 00:26:27,960
Speaker 8: has had a command over the party, not just over

536
00:26:27,960 --> 00:26:29,680
Speaker 8: the past few months, but over the past few years.

537
00:26:30,160 --> 00:26:32,600
Speaker 8: So it is a performance. It is how you take

538
00:26:32,640 --> 00:26:35,080
Speaker 8: a punch, how you land a punch, how you come

539
00:26:35,119 --> 00:26:38,040
Speaker 8: back from a punch. Nicki Haley has really made her

540
00:26:38,080 --> 00:26:41,600
Speaker 8: bones in this race by lighting up vivek Ramaswany like

541
00:26:41,640 --> 00:26:44,560
Speaker 8: a pinball machine at debates, and it seems their voters

542
00:26:44,560 --> 00:26:45,240
Speaker 8: appreciate that.

543
00:26:45,320 --> 00:26:46,240
Speaker 1: Look for more of that tonight.

544
00:26:46,359 --> 00:26:48,960
Speaker 5: Let's continue the conversation for this month. Matthew Greta catch

545
00:26:48,960 --> 00:26:51,760
Speaker 5: out Matthew Bountle at the f Danby Field Advisors.

546
00:26:51,960 --> 00:26:55,760
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547
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548
00:27:00,359 --> 00:27:03,879
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549
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550
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551
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552
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553
00:27:14,080 --> 00:27:15,000
Speaker 1: Thanks for listening.

554
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