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Speaker 1: Welcome to the Bloomberg pm L podcast. I'm Pim Fox.

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Speaker 1: Along with my co host Lisa Abramowitz. Each day we

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Speaker 1: bring you the most important, noteworthy, and useful interviews for

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Speaker 1: you and your money, whether at the grocery store or

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Speaker 1: the trading floor. Find the Bloomberg p L podcast on iTunes,

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Speaker 1: SoundCloud and at Bloomberg dot com. It is my pleasure

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Speaker 1: to bring in former Senator Joe Lieberman. Uh. You have founded,

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Speaker 1: or you're the co chairman of a nonpartisan advocacy group

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Speaker 1: called No Labels that's meeting um to sort of figure

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Speaker 1: out how to chart a center political new way forward.

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Speaker 1: Can you tell us a little bit about how this

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Speaker 1: came about? Sure, can, and thanks for having me on.

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Speaker 1: We're holding a big conference were calling at the summit.

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Speaker 1: We actually called it seven after the year of the

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Speaker 1: Constitutional Convention, to remind everybody that the people at the

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Speaker 1: Constitutional Convention had tremendous disagreements. They almost broke up with

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Speaker 1: three or four times, but they came to the center

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Speaker 1: and negotiated a compromise in the national interest. Uh, and

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Speaker 1: therefore we have our country. We haven't our leaders and

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Speaker 1: representatives in Washington haven't been doing that for too long,

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Speaker 1: and therefore a lot of our problems have gone unsolved

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Speaker 1: and a lot of opportunities not seized to make life better.

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Speaker 1: And a lot of that expressed itself in the election

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Speaker 1: where uh Donald Trump was elected. Really, in my opinion,

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Speaker 1: is a change candidate against the status quo and maybe

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Speaker 1: somebody who based on his business background, could could make

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Speaker 1: things work. And so today no labels means put aside

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Speaker 1: your label a Democrat, Republican, liberal, conservative, where all Americans

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Speaker 1: let's work together to get something done for the country.

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Speaker 1: We're announcing today uh fifty members of Congress, pretty evenly

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Speaker 1: divided between Republicans and Democrats, whore signed on to working

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Speaker 1: together across party lines. And we're also um building a

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Speaker 1: political Action committee to support people in Congress who stand

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Speaker 1: up to their party leadership or interest groups and and

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Speaker 1: vote in a way that they think is best for

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Speaker 1: their constituents or their country. We think the election of

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Speaker 1: Donald Trump really shakes up the system in a way.

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Speaker 1: I didn't support them, but I would tell you it

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Speaker 1: shakes up the system in a way that gives us

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Speaker 1: an opportunity to help him do what we think he

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Speaker 1: wants to do well. And and speaking about that election,

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Speaker 1: Senator Lieberman, do you think that these first steps are

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Speaker 1: sort of the beginnings of a new political party that's

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Speaker 1: not where that's the Grant's a great question. A few

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Speaker 1: people here have raised the question in our feeling. Governor

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Speaker 1: Huntsman of Utah, the former governor Republican and I have

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Speaker 1: our co chairs. That's not our intention. Our intention really

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Speaker 1: is to make the two party system work better, like

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Speaker 1: it has for a lot of our history, and it

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Speaker 1: always does when the center right and the senator left

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Speaker 1: gets together. But I'll tell you if something like this

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Speaker 1: doesn't work to help the government produce for the American people,

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Speaker 1: I think there will be a third party before the

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Speaker 1: next presidential election, and it will be a contender. It

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Speaker 1: will be a strong party. Senator Lieberman, what if you

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Speaker 1: could point to some specific goals you have. I note,

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Speaker 1: for example, that no Labels has called for a bipartisan

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Speaker 1: seating at the State of the Union address. I mean,

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Speaker 1: is that the kind of stuff that you think people

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Speaker 1: really want you to come together on. Well, that's really

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Speaker 1: small process things, uh, And it can't hurt and that's

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Speaker 1: happened over over the years. But the truth is, are

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Speaker 1: are we? We are really about process. But we for

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Speaker 1: the first time put out what we call a national

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Speaker 1: Strategic Agenda, and we try to form four big goals

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Speaker 1: for the country and uh state them in a way

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Speaker 1: that that most Republicans and Democrats could at least agree

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Speaker 1: on the goal. And then you start to negotiate. So,

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Speaker 1: what are the goals? Million new jobs in ten years.

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Speaker 1: Actually that's a goal that President Electrump was already embraced. Second,

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Speaker 1: but it's that But that's never not a goal, right,

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Speaker 1: I mean, you never come out and hear people say, oh, no,

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Speaker 1: we don't want to create jobs. So what is different

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Speaker 1: about your approach than the approach that other presidents and

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Speaker 1: the current president elective status? Okay, fair question. And and

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Speaker 1: here's what we're saying with these four goals. When you

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Speaker 1: when you're not doing anything, when your business is failing

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Speaker 1: or whatever, Uh, the first thing you try to do

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Speaker 1: is decide where do we want to go? We said goals.

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Speaker 1: And in the political process, if you can get people

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Speaker 1: to buy into the goals, then you can sit down

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Speaker 1: and negotiate how you're going to achieve as much of

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Speaker 1: those goals as you possibly can. And and that's why

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Speaker 1: we started there. Incidentally, we invited all the presidential candidates

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Speaker 1: to a convention we hold in New Hampshire last year.

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Speaker 1: Donald Trump was one of eight to address us. At

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Speaker 1: that time they were over twenty running, and he accepted

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Speaker 1: are he signed our pledge to go for one of

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Speaker 1: these goals, and what it means is to convene a

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Speaker 1: process of leaders, hopefully in both parties in Congress, to

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Speaker 1: begin to negotiate one of the problems in Washington. Has

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Speaker 1: too many people in Congress today or in the White

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Speaker 1: House have said, I'm only gonna accept this if it's

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Speaker 1: exactly the way I want it, if it's a dent

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Speaker 1: of what I want. And when you do that, you

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Speaker 1: usually end up with zero percent. And of course it's

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Speaker 1: the country that suffers. Senator Lieberman, do you think that

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Speaker 1: it was a mistake for the Democrats to reelect or

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Speaker 1: re select Nancy Pelosi as the as a minority leader

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Speaker 1: of the United States House of Representatives. Again, Well, and

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Speaker 1: that's up to the House Democrats. I know, I don't.

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Speaker 1: I don't think it's really I wouldn't say it's a mistake.

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Speaker 1: I think the question is, now, what are the House

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Speaker 1: Democrats do and what are the House Republicans do it. Look,

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Speaker 1: I've talked to members of Congress of both political parties

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Speaker 1: since the election, and their voices in each caucus that

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Speaker 1: are are all too familiar. Some Democrats are saying, we

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Speaker 1: must go into resistance, we must oppose everything that President

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Speaker 1: Trump passed Ford and then some Republicans are saying, let's

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Speaker 1: do what Obama did at the beginning of his term.

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Speaker 1: Let's just ram it down the Democrats throats. We've got uh,

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Speaker 1: we've got majorities in both houses. Well, if that, if

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Speaker 1: those voices dominate, then really nothing's gonna get done. And

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Speaker 1: and President Trump will not have the record I think

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Speaker 1: he wants to have, and the country will not have

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Speaker 1: the help that it voted for in the last election.

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Speaker 1: So really it depends on what leaders Polosi, Ryan McConnell

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Speaker 1: and Schumer do. Uh and um, that's what we want

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Speaker 1: to help him do it, which is the right thing?

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Speaker 1: One If you could speak to the issue of combining

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Speaker 1: the work that the Department of Defense does along with

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Speaker 1: the veterans administration, I know that's one of your goals

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Speaker 1: of combining records. Why you want to do that? Oh,

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Speaker 1: outside of our playbook. And let me just say about

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Speaker 1: the playbook that we we combined. Uh, we actually tested

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Speaker 1: a lot of ideas. Some of them are big, some

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Speaker 1: of them are kind of middle sizes are small. But

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Speaker 1: the each command majority support from the American people, and

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Speaker 1: that was one of But what about the Congress. You

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Speaker 1: think they're going to pass this? Well hopefully, Uh, you know,

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Speaker 1: because it does. It makes sense that it saves money

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Speaker 1: and it probably and it serves both the active duty

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Speaker 1: military and the veterans better. It avoids the sort of

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Speaker 1: spending twice for the same kind of record keeping. I

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Speaker 1: want to thank you very much. Former US Senator, Democrat

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Speaker 1: and independent from a Connecticut, former vice presidential candidate Joe Lieberman.

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Speaker 1: He is the coach chairman of No Labels. All right,

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Speaker 1: we're gonna learn more about the world of a Wall

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Speaker 1: Street analysts. We have Land and Nuyen are Bloomberg FX

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Speaker 1: reporter joining us now, Lanna and thanks very much for

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Speaker 1: coming in. Uh seventeen cat fines that will slay you

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Speaker 1: every time. No, that may not be the headline of

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Speaker 1: a Bank of America Mary Lynch report, but it might

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Speaker 1: be one day. Well, they haven't stooped quite that far yet, PIM.

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Speaker 1: But what analysts are trying to do here is really

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Speaker 1: trying to hook readers. They're trying to make bold, short

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Speaker 1: calls in contrarian reports. So I spoke to David wu

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Speaker 1: from Bank of America and uh, he's very feisty, as

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Speaker 1: you know. Um, but I think the bank is trying

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Speaker 1: to spread this ethos across all of its analysts have

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Speaker 1: some guts. If you have an interesting call, you go

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Speaker 1: all the way, don't play it safe, and don't reel

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Speaker 1: it back to be part of the consensus. Okay, So

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Speaker 1: if they haven't gone as low as seventeen cat fines

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Speaker 1: that will slay you every time. How low have they gone?

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Speaker 1: I don't know if it's low, but they've done what

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Speaker 1: we in the news business do. They've got you know,

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Speaker 1: focused on shorter reports, tighter stories, and um, you know,

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Speaker 1: tighter thematic pieces and better headlines. I think so why now,

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Speaker 1: why is there this push to sort of be more

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Speaker 1: consumer friendly? Well, if you know, they're listening to what

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Speaker 1: happened after the financial crisis, a lot of people have

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Speaker 1: lost their jobs. There are fewer people out there churning

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Speaker 1: out these twenty page, you know, thirty page reports. So

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Speaker 1: they really got to be smarter with their time, get

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Speaker 1: people reading the reports, and build a following by being amusing,

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Speaker 1: being interesting, and lighthearted in addition to obviously being smart.

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Speaker 1: For your story, you spoke with the global research head

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Speaker 1: of Bank of America, Merrill Lyncha Candice Browning. What did

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Speaker 1: she say? She was interesting? She said, basically, I want

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Speaker 1: my people to be bold. I want them to talk

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Speaker 1: about what's not already price in the market. I want

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Speaker 1: them to be out of consensus, not just you know,

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Speaker 1: going against consensus for the sake of it, but really

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Speaker 1: um looking to see what the next move in the

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Speaker 1: market is going to be. Because everything that's in the

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Speaker 1: market and in the price right now is already priced in.

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Speaker 1: So um. She was pretty tough about that. She said,

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Speaker 1: make a big call, you know, stand out from the herd,

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Speaker 1: or else you won't stick arount and catchy titles, right.

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Speaker 1: I mean, for example, one report, I guess it was

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Speaker 1: published what last year last November called the Great Divorce? Right?

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Speaker 1: This was written by Mr Woo. Yes, well, so my

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Speaker 1: question is how do these analysts make money for the banks,

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Speaker 1: and how much of that is the issue here? So

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Speaker 1: right now, they make money for the bank by being

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Speaker 1: part of an add on service of perks. Right, So

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Speaker 1: if you and I do a deal and Bank America

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Speaker 1: as your bank, then probably the third research in on

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Speaker 1: the side without a separate fee. It's just part of

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Speaker 1: the cost of being a client. But eventually banks may

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Speaker 1: need to, especially in Europe, we'll we'll need to start

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Speaker 1: charging a fee, either directly or as part of a

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Speaker 1: commission for research. So it means that the researchers have

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Speaker 1: to really jostle to stand out because eventually you may

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Speaker 1: have to put a price tag on each research report.

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Speaker 1: So that's that's really the issue here is that increasingly

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Speaker 1: there has to be justification for this research and its value,

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Speaker 1: and there has to be a loyal following otherwise it

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Speaker 1: could very well get cut. Precisely, it's the quality of

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Speaker 1: the ideas, but it's also the following of the analysts

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Speaker 1: and the ability of the analysts to engage the readers,

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Speaker 1: which sometimes means they have to put in some song

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Speaker 1: lyrics or use Bob Dylan as a you know, a

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Speaker 1: way to hook readers. Obviously the analysis has to be

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Speaker 1: good as well, but it doesn't hurt to, you know,

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Speaker 1: throw in a couple of fun touches. So does this mean,

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Speaker 1: for example, that we're going to hear Kit Jukes of

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Speaker 1: Associotation Arel and he's been a guest on Bloomberg for

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Speaker 1: a variety of subjects. Does that mean he's going to

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Speaker 1: start to sing those Bob Dylan lyrics as well as

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Speaker 1: Latin proverbs as he offers him in his notes to clients.

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Speaker 1: I don't know if he'll sing them in audio form,

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Speaker 1: but he's certainly one person that if you want to

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Speaker 1: model UH analyst research with flair, definitely look at Kit Jukes.

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Speaker 1: Was just looking right now. His current report from today

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Speaker 1: compares the US dollar to the myth of Icarus, So

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Speaker 1: you know, he's very literary in addition to being pretty

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Speaker 1: musical as well. Um So, going forward, is there a

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Speaker 1: particular area, a particular subject of analysis that lends itself

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Speaker 1: to lyrics and is it? Is it f X or

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Speaker 1: is it across all this? I think it's across all disciplines.

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Speaker 1: I think if you're writing about financial markets, which can

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Speaker 1: be very technical, you need to throw a little spice

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Speaker 1: in there that doesn't hurt in any discipline to write

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Speaker 1: with a flair and entertainment in addition to good analysis

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Speaker 1: and smart comments. Lenan Nunion, thank you so much. For

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Speaker 1: joining us. Lenan Nunion h f X reporter here at

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Speaker 1: Bloomberg News. Really fascinating story about how the culture is changing,

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Speaker 1: not just among mainstream media but also on Wall Street.

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Speaker 1: I want to bring in my colleague by Bloomberg Gadfly

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Speaker 1: fellow columnist Marcus Ashworth. He is in London covering European

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Speaker 1: Marcus markets, and Marcus, thank you so much for being

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Speaker 1: with us. Uh. You know, I've got to say I'm

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Speaker 1: sort of surprised at the lack of a market reaction

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Speaker 1: to the Italian referendum. Yes, this has been sort of expected. Yes,

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Speaker 1: people were saying it's not as big of an issue

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Speaker 1: as Brexit or the U S presidential vote. But even still,

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Speaker 1: I think you might finance because the European Central Bank

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Speaker 1: of learned their lessons and they know how to control

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Speaker 1: markets ever better. So I think certainly there was the

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Speaker 1: central banks are in very early supporting the bond market.

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Speaker 1: And wait, you're saying that actually that they were buying

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Speaker 1: that the Europeans on Bank was out there buying actively

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Speaker 1: buying both the euro as well as as well as

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Speaker 1: potentially government bonds, don't I don't know in the currency

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Speaker 1: and I would doubt that on the currency secret no, no, no,

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Speaker 1: that that they would be buying the Italian government bonds UM,

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Speaker 1: and that would be something which is reasonably widely expected.

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Speaker 1: They had flagged it up beforehand, and though I cannot

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Speaker 1: confirm for sure, it seems all likelihood would point to that,

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Speaker 1: and the price action would would suggest that no one's

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Speaker 1: prepared to use the expression and fight the FED. But

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Speaker 1: it's the same sort of story here the Youran Central

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Speaker 1: Bank and made it very clear that are on a

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Speaker 1: negative reaction, they would be in supporting their perfectly titled

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Speaker 1: to It's all part of their PSPP public sector purchasing program,

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Speaker 1: and we may find out on Thursday that they could

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Speaker 1: even increase UM or tweak the purchasing of Italian bonds

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Speaker 1: pro rata all the other bonds, and indeed extend QUEWI

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Speaker 1: as well. So this is this was to be expected, um.

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Speaker 1: Even so, though I agree with you in a sense

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Speaker 1: that everyone had expecting a wilder reaction, and it really

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Speaker 1: wasn't until the States came in when they wanted to

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Speaker 1: sell bonds off anyway, that there's been a little bit

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Speaker 1: more price action for the downside. Well, and sort of

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Speaker 1: to your point, yes, Italian government debt could be purchased

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Speaker 1: by the European Central Bank. But I'm looking at Manto

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Speaker 1: Paschi bonds and they dropped, yes, but they dropped by

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Speaker 1: less than three cents on the dollar, which was surprising.

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Speaker 1: You know, there was not a huge move in other words, um,

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Speaker 1: and there was all this talk about Italian banking crisis

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Speaker 1: leading up to this vote, where people just wrong or

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Speaker 1: is there still potentially more risk here than people are

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Speaker 1: pricing in. Um. Yeah, the liquidity or illiquidity on mont

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Speaker 1: Apache is to be seen to be believed. It's completely

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Speaker 1: controlled market. That's just a by bond by back, so

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Speaker 1: anyone wish to get out had their chance. Now it's

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Speaker 1: a very care controlled market because they're about to do

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Speaker 1: a major stock recapitalization. So um, it's impressive, but I

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Speaker 1: think the lead managers on on the equity deal will

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Speaker 1: be keeping a very careful eye on on price and

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Speaker 1: most of a passion. The reality is is that the

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Speaker 1: authorities or the lead managers want to come in and

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Speaker 1: buy a chunk of these bonds with the market sharply

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Speaker 1: upwards so that there's less active short sellers and these

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Speaker 1: types of things. Is that's very hard to sort of

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Speaker 1: get liquidity on these types of results. Marcus, I want

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Speaker 1: if you could come into on the reaction from other

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Speaker 1: European governments and markets to the Italian vote. Yeah, I

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Speaker 1: think that's it's all around. It's it's we've taken some

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Speaker 1: of the political risk out because even though it was

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Speaker 1: the worst result expected in some senses, Um, it would

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Speaker 1: be very carefully controlled both by the e CP beforehand.

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Speaker 1: And I think you know Italy has been here before

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Speaker 1: with technocratic governments in Ramsey him in and not necessary

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Speaker 1: on a full man day anyway. So and that last,

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Speaker 1: I think that the last popularly elected prime minister in

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Speaker 1: Italy was Sylvia Berlsconi back in two thousand and eight.

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Speaker 1: They have not had a popularly elected government for eight years. Indeed,

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Speaker 1: So in that sense that we have seen this movie before, Um,

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Speaker 1: the Finance minister probably or someone either that or the

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Speaker 1: Culture minister or possibly one of the Senate leaders will

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Speaker 1: come in. So UM, you know that it's not going

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Speaker 1: to be any rash decisions made. That the president is

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Speaker 1: has the electoral ability to control when elections are called

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Speaker 1: to a degree, Um, and I think that they will

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Speaker 1: try everywhere they possibly can. The one thing is a surprise,

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Speaker 1: I suppose, is the size of the vote that it's

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Speaker 1: it's quite clear that Renzi is going to step down permanently,

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Speaker 1: whereas it had been expected he might have been a

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Speaker 1: sort of called back, a bit like James Brown too,

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Speaker 1: to come back to the stage. But doesn't look like that.

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Speaker 1: His career is probably over for now. Marcus, your point

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Speaker 1: about the liquidity and Monte Depachis is an important one,

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Speaker 1: and just more broadly looking at the market, I mean,

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Speaker 1: is there a particular gauge that you are looking at

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Speaker 1: to indicate truly the level of risk or so that

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Speaker 1: you think of is the most accurate reflection of of

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Speaker 1: the risk out there. Honestly, probably the best thing to

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Speaker 1: look at in this sense, because the bond market is

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Speaker 1: so liquid and so tightly controlled and kepting, is the

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Speaker 1: equity price, because that's what's going to be raised five times.

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Speaker 1: But not just with Mount Tapache, but in general. I

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Speaker 1: was looking at Italian financial stocks this morning and they

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Speaker 1: were down, but not by that much. There's still above

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Speaker 1: the average since the beginning of to Lie, So it

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Speaker 1: doesn't seem to be that people are pricing in any

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Speaker 1: any kind of banking crisis well, I thought they are

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Speaker 1: from there they are that they're doing in a different

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Speaker 1: way because the worst case scenario Italy can't can't bail

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Speaker 1: itself out as it's trying to without state aid. But

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Speaker 1: it's Atlante bailout fund and by this UM non public

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Speaker 1: sector bailout of Montitapache, which will involve five times equity

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Speaker 1: recap potentially, you know, was supposed to be announced from today. Um.

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Speaker 1: The only other way out is as a major state bailout.

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Speaker 1: I mean, Spain had a sort of forty billion hand

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Speaker 1: out from the EU and obviously that's what Renzi was

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Speaker 1: trying to avoid. But the the reality of things have

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Speaker 1: got so bad down here that um, if they weren't

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Speaker 1: able to make it a private sector bailout, then there

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Speaker 1: would be a bailion of junior bond holders and there

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Speaker 1: would be a some form of states EU lead all

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Speaker 1: around package for indeed, for UM for the whole banking sector,

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Speaker 1: and it wouldn't us be once of the past, you

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Speaker 1: would be a much wider thing. But you know, UNI

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Speaker 1: Credit got a result this morning. It sold its pioneer

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Speaker 1: asset management unit to very large French concern a Mundy,

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Speaker 1: which manages over a trillion euros. So in that sense,

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Speaker 1: that's that's that's the progress. They're instant timing and announcing

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Speaker 1: it there, so that I think there's every chance still

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Speaker 1: that this deal is going to get away. It just

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Speaker 1: needs to convince a a corner stone equity beds behind

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Speaker 1: Mount Apache that builds confidence that then have to sell

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Speaker 1: less of the equity than they were. We're thinking everything

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Speaker 1: trips favorably if a technocratic government comes in um and

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Speaker 1: seems to sort of level the playing field and we

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Speaker 1: can move on from this. But it's a very carefully,

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Speaker 1: very managed thing. And then you know, selling short monster

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Speaker 1: Apacchi bonds is is not really going to get you

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Speaker 1: very far. But one you can't borrow them, and to

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Speaker 1: that they've already had the major debt to equity switch.

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Speaker 1: So got it all right, Thanks very much. Marcus Ashworth

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Speaker 1: is a gad Fly columnist for Bloomberg News covering a

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Speaker 1: European markets and you know, Lisa, I was looking at

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Speaker 1: the Italian government debt public debt GDP. My favorite quote

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Speaker 1: of the day after Brexit it took three days from

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Speaker 1: markets to shake it off with Trump, three hours with

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Speaker 1: Italy three minutes. This is Bloomberg. Well, imagine that Italian

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Speaker 1: voters go to the polls and they vote no, want

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Speaker 1: a referendum to reform the way their government works. You'd

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Speaker 1: think that the euro would fall. Not so euro right

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Speaker 1: now higher by about a half percent versus the dollar

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Speaker 1: at one oh seven. Also the dollar weakening against the

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Speaker 1: British pound at one seven. Let's find out more from

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Speaker 1: Mark Chandler. He is Global head of Currency Strategy at

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Speaker 1: Brown Brothers Harriman. Alright, Mark Chandler, what's the answer. Why

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Speaker 1: is the euro rallying? Well? Two eason? Same? One. I

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Speaker 1: think is that this referendum results was largely expected. All

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Speaker 1: the polls that came out beforehand suggested that the referendum

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Speaker 1: was gonna be rejected, and it was rejected by about

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Speaker 1: basically a sixty vote. What this doesn't mean, though, and

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Speaker 1: this is I think the you're is able to rally,

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Speaker 1: is that does not mean that this is a victory

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Speaker 1: for the anti establishment of anti elite forces in Italy.

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Speaker 1: A former prime minister, Monty, who is also an EU commissioner,

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Speaker 1: came out against the referendum. So the members of Rendi's

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Speaker 1: own political party and the Commerce magazine, which is no liberal,

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Speaker 1: no like left wing kind of magazine. They also came

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Speaker 1: out against the referendum. And so I think that the

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Speaker 1: situation is, this is Italy. I mean, we're talking about

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Speaker 1: a country that has something like sixty three or sixty

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Speaker 1: four government since the end of World War Two. This

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Speaker 1: is not about populism and nationalism. This is about idiosyncratic

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Speaker 1: Italian things. And so Italian bonds have suffered, Italian stocks

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Speaker 1: have suffered. But after that knee jerk reaction, the euro

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Speaker 1: really hasn't. Yeah, the German finance minister had a great

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Speaker 1: quote basically saying, yeah, this is Italy. They know they're

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Speaker 1: they're used to this type of thing. They'll work it out. Um.

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Speaker 1: But there still is a lot of talk about how

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Speaker 1: this does empower a sort of anti European Union mentality.

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Speaker 1: And we certainly have more votes coming, uh, not least

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Speaker 1: of which is the is the French vote. I mean,

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Speaker 1: do you think that people will get concerned in the

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Speaker 1: upcoming months, are more concerned anyway about the breakup of

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Speaker 1: the Eurozone? Well, I think you know on Wall Street, Lisa,

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Speaker 1: and I think in many places in London people have

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Speaker 1: been skeptical about the monetary union since to get go.

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Speaker 1: I was one of those two people who didn't think

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Speaker 1: Greece is going to drop out either time, either in

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Speaker 1: two thousand and ten or a couple of years ago.

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Speaker 1: I think that people will get nervous. I think again,

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Speaker 1: like like we saw with this past weekend, though, that

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Speaker 1: they're focused on the wrong things. I thought that the

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Speaker 1: Austria elections for president, where the far right candidate had

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Speaker 1: had done very well in the earlier runoff in the spring,

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Speaker 1: I thought that was gonna be more important than the

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Speaker 1: Italian election. As far as those concerns about the e

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Speaker 1: MU goes next year, I think you're right. A lot

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Speaker 1: of people least are talking about the French election, how

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Speaker 1: well a PENN is running the polls. I want to

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Speaker 1: tell you that before we even get to the French election,

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Speaker 1: there'll be even a scarier election, and that is in

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Speaker 1: the Netherlands, where the far right party is running ahead.

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Speaker 1: In France, it seems to me that the other parties,

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Speaker 1: whether it's the Republican that they've sent, a right party

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Speaker 1: or a socialist, will end up in the second round

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Speaker 1: to do anything to stop the PEN from winning. You

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Speaker 1: don't have that same uh same history in the Netherlands.

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Speaker 1: So I'd be more worried about the Netherlands at this

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Speaker 1: point that I am about France or Germany for that matter. Mark,

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Speaker 1: can I just press you a little bit about your

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Speaker 1: description of the reason why the euro is rallying against

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Speaker 1: the dollar. I mean, you say that this was a

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Speaker 1: predicted result. Well, okay, if it was predicted, then why

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Speaker 1: is the euro rally? Why are people buying euros selling

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Speaker 1: dollars when you just said, first of all, it was predicted,

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Speaker 1: and second of all you say that, well it's Italy,

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Speaker 1: it's not a big deal because they're used to changing

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Speaker 1: governments and you have former prime ministers also coming out

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Speaker 1: in favor of a novo. What does that mean? Why?

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Speaker 1: Why is that connected to the euro? Then? Yep, So

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Speaker 1: I think that what happened is this. I think tim

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Speaker 1: that the euro had been on had been selling off

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Speaker 1: sharply since the election, but most recently the new good

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Speaker 1: news in the US, which would be the jobs data,

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Speaker 1: but also the whole slew of data that we've had

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Speaker 1: suggesting that the US economy didn't only grow well above

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Speaker 1: trend in Q three, but it's headed for another quart

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Speaker 1: of above trend growth and stopped having an effect on

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Speaker 1: the dollar. Why I think that. I mean, I mean

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Speaker 1: you have that, but then also have rising interest rates

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Speaker 1: in the United States. If you buy a tenure U

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Speaker 1: S government versus a tenure Italian, you're gonna be making

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Speaker 1: more money. Why wouldn't you want dollars instead of euros? Well,

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Speaker 1: I think that most people do still, But I think

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Speaker 1: that in the short rum, we've got to talk about

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Speaker 1: the different market segments, and I think that the short

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Speaker 1: term market participants are being to take profits on what

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Speaker 1: turned out to be a very large move in the euro,

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Speaker 1: coming down from one twelve one thirteen, we got down

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Speaker 1: to one oh five yesterday, which is a earlier today,

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Speaker 1: which is a new twenty month low. So yes, people

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Speaker 1: have been selling the euro. But now I think that

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Speaker 1: if the market some kind of rebound or some kind

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Speaker 1: of reaction to that. Thanks for listening to the the Bloomberg

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00:25:56,840 --> 00:25:59,639
Speaker 1: P and L podcast. You can subscribe and listen to

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00:25:59,640 --> 00:26:04,919
Speaker 1: interview us at iTunes, SoundCloud, or whatever podcast platform you prefer.

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Speaker 1: I'm Pim Fox. I'm out there on Twitter at pim Fox.

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Speaker 1: I'm out there on Twitter at Lisa Abramo. It's one

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00:26:11,800 --> 00:26:14,520
Speaker 1: before the podcast. You can always catch US worldwide on

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00:26:14,560 --> 00:26:21,080
Speaker 1: Bloomberg Radio