1 00:00:02,520 --> 00:00:10,080 Speaker 1: Bloomberg Audio Studios, podcasts, radio news. You're listening to the 2 00:00:10,119 --> 00:00:13,880 Speaker 1: Bloomberg Balance of Power podcast. Catch us live weekdays at 3 00:00:13,920 --> 00:00:17,119 Speaker 1: noon and five pm Eastern on Apple Coarckley and Android 4 00:00:17,160 --> 00:00:20,520 Speaker 1: Auto with the Bloomberg Business App. Listen on demand wherever 5 00:00:20,600 --> 00:00:25,040 Speaker 1: you get your podcasts, or watch us live on YouTube. 6 00:00:25,320 --> 00:00:27,080 Speaker 2: It's quite a night for President Trump. You went all 7 00:00:27,120 --> 00:00:30,120 Speaker 2: the way up to Pennsylvania to talk about affordability and 8 00:00:30,200 --> 00:00:32,720 Speaker 2: mock the word, calling it once again a Democrat hoax. 9 00:00:32,760 --> 00:00:35,760 Speaker 2: But he was busy on truth social Just about a 10 00:00:35,800 --> 00:00:38,440 Speaker 2: couple hours before midnight, we saw the post. There has 11 00:00:38,560 --> 00:00:41,680 Speaker 2: never been a president that has worked as hard as me, 12 00:00:42,000 --> 00:00:44,720 Speaker 2: he wrote, exclamation point. My hours are the longest and 13 00:00:44,760 --> 00:00:48,159 Speaker 2: my results are among the best. But interesting, and this 14 00:00:48,280 --> 00:00:51,760 Speaker 2: was a long post. You get about halfway through it, 15 00:00:51,800 --> 00:00:55,240 Speaker 2: and it was quite revealing. I have done something no 16 00:00:55,320 --> 00:00:59,520 Speaker 2: other president has done, he wrote, on three separate occasions, 17 00:01:00,520 --> 00:01:03,840 Speaker 2: the last one being recently, by taking what is known 18 00:01:03,880 --> 00:01:07,360 Speaker 2: as a cognitive examination, something which few people would be 19 00:01:07,400 --> 00:01:10,640 Speaker 2: able to do very well, including those working at the 20 00:01:10,680 --> 00:01:15,360 Speaker 2: New York Times. And I aced in all caps, all 21 00:01:15,440 --> 00:01:18,160 Speaker 2: three of them, in front of large numbers. Get this 22 00:01:18,640 --> 00:01:21,920 Speaker 2: in front of large numbers of doctors and experts, most 23 00:01:21,959 --> 00:01:26,399 Speaker 2: of whom I do not know. So the President of 24 00:01:26,400 --> 00:01:28,560 Speaker 2: the United States is now taking on the regular We've 25 00:01:28,600 --> 00:01:31,400 Speaker 2: had three now, and I don't know what period of 26 00:01:31,440 --> 00:01:33,640 Speaker 2: time is that in the last ten months with a 27 00:01:33,680 --> 00:01:37,920 Speaker 2: battery of doctors he doesn't know watching him. We'll just 28 00:01:38,000 --> 00:01:39,840 Speaker 2: park that because I feel like we need to hear 29 00:01:39,880 --> 00:01:42,680 Speaker 2: more about it. We heard a lot more about tariffs 30 00:01:42,760 --> 00:01:44,880 Speaker 2: last night, because he can't have one story without the 31 00:01:44,920 --> 00:01:47,400 Speaker 2: other when it comes to affordability. And the President made 32 00:01:47,440 --> 00:01:49,640 Speaker 2: it pretty clear to the people watching in Pennsylvania that 33 00:01:49,680 --> 00:01:51,640 Speaker 2: if you're not on board with the tariffs, well there's 34 00:01:51,640 --> 00:01:54,840 Speaker 2: probably something wrong with you. Listen. I took a lot 35 00:01:54,840 --> 00:01:55,200 Speaker 2: of heat. 36 00:01:56,160 --> 00:01:58,480 Speaker 3: I got up early on. I said, my favorite is 37 00:01:58,480 --> 00:02:01,560 Speaker 3: turning out. Did you know Tariff's geeing US hundreds of 38 00:02:01,720 --> 00:02:02,960 Speaker 3: billions of dollars? 39 00:02:03,400 --> 00:02:05,760 Speaker 2: I just helped our farmers out. It's amazing. 40 00:02:05,800 --> 00:02:07,800 Speaker 3: It's the smart people understand it. 41 00:02:07,920 --> 00:02:09,320 Speaker 2: Other people are starting. 42 00:02:09,000 --> 00:02:12,200 Speaker 3: To learn, but the smart people really understand it. 43 00:02:13,520 --> 00:02:15,799 Speaker 2: The smart people are starting to understand it. Let's see 44 00:02:15,800 --> 00:02:18,919 Speaker 2: if Christopher Smart sees it that way. He's the founder 45 00:02:18,960 --> 00:02:21,840 Speaker 2: managing partner are Growth Group, former Special assistant to the President, 46 00:02:22,280 --> 00:02:25,480 Speaker 2: National Economic Counsel in the Obama administration. Great to have 47 00:02:25,560 --> 00:02:27,799 Speaker 2: you back in the nation's capital, mister smart. Great to 48 00:02:27,840 --> 00:02:30,560 Speaker 2: be here. Is the President right about this because a 49 00:02:30,600 --> 00:02:33,800 Speaker 2: lot of smart people have been questioning the impact of 50 00:02:33,840 --> 00:02:35,799 Speaker 2: these tariffs and on prices specifically. 51 00:02:36,280 --> 00:02:40,200 Speaker 4: Well, we haven't taken our cognitive tests yet, are growth group, 52 00:02:40,240 --> 00:02:42,359 Speaker 4: And I'm not sure whether you've done that yet at Bloomberg, but. 53 00:02:43,200 --> 00:02:45,040 Speaker 2: At least have to do that, James, I didn't get 54 00:02:45,040 --> 00:02:45,480 Speaker 2: one here. 55 00:02:46,160 --> 00:02:49,560 Speaker 4: Most economists, I think will tell you that the tariffs 56 00:02:49,600 --> 00:02:51,720 Speaker 4: that have been put in place have yet to really 57 00:02:51,800 --> 00:02:55,560 Speaker 4: hit and in terms of inflation numbers, a lot of 58 00:02:55,600 --> 00:02:57,480 Speaker 4: the things that are showing up on store shelves today 59 00:02:57,560 --> 00:02:58,040 Speaker 4: got on the. 60 00:02:57,960 --> 00:03:00,320 Speaker 2: Boats before the terroift. That why is front and we 61 00:03:00,320 --> 00:03:01,880 Speaker 2: were just talking about with Stuart Paul. 62 00:03:01,960 --> 00:03:03,400 Speaker 4: I think there's some of that going on, and then 63 00:03:03,440 --> 00:03:05,440 Speaker 4: we'll see a little bit more of that coming in 64 00:03:05,880 --> 00:03:08,960 Speaker 4: next year. I think those will be really reflected inflation 65 00:03:09,040 --> 00:03:11,280 Speaker 4: numbers once we start getting inflation numbers again, because of 66 00:03:11,320 --> 00:03:14,000 Speaker 4: course with the government shutdown, we had that lag. But 67 00:03:14,120 --> 00:03:16,720 Speaker 4: I think that's going to be a headwind for a 68 00:03:16,720 --> 00:03:19,000 Speaker 4: lot of consumers next year, and that's going to make 69 00:03:19,040 --> 00:03:22,600 Speaker 4: his case about affordability maybe a little harder to make. 70 00:03:22,600 --> 00:03:23,800 Speaker 2: I mean, it doesn't really matter. 71 00:03:23,880 --> 00:03:26,280 Speaker 4: You know, economists and investors look at the numbers and say, well, 72 00:03:26,320 --> 00:03:28,160 Speaker 4: things are getting better. But if you don't feel like 73 00:03:28,200 --> 00:03:30,720 Speaker 4: it's getting better for a politician, I'm not sure that 74 00:03:30,760 --> 00:03:32,079 Speaker 4: translates into the votes you're hopeing. 75 00:03:32,240 --> 00:03:34,160 Speaker 2: Right, that's the political side of things. But you're telling 76 00:03:34,160 --> 00:03:35,800 Speaker 2: me that it's not about to get better. It's probably 77 00:03:35,840 --> 00:03:39,480 Speaker 2: about to get worse. A combination of front running and companies. 78 00:03:39,600 --> 00:03:42,240 Speaker 2: You tell me, we're hearing from the likes of Walmart 79 00:03:42,680 --> 00:03:45,280 Speaker 2: and others to say that we can't absorb this forever, 80 00:03:45,400 --> 00:03:47,160 Speaker 2: that at some point we will start passing this on 81 00:03:47,240 --> 00:03:49,000 Speaker 2: in different ways. Is that what you're waiting for and 82 00:03:49,040 --> 00:03:50,920 Speaker 2: why did it take so long? Well, I think that's right. 83 00:03:50,960 --> 00:03:53,040 Speaker 4: I mean, on the other side of things, we don't 84 00:03:53,040 --> 00:03:56,280 Speaker 4: expect tariffs to go much higher from here. It's really 85 00:03:56,280 --> 00:03:58,800 Speaker 4: a question of the confusion of where things settle down. 86 00:03:59,000 --> 00:04:02,120 Speaker 4: And so they argument about the one time price adjustment. 87 00:04:02,160 --> 00:04:05,120 Speaker 4: We hear from Scott Besson exactly exactly, and that's why 88 00:04:05,160 --> 00:04:07,080 Speaker 4: I think people sort of expect there will be a 89 00:04:07,120 --> 00:04:10,680 Speaker 4: one time increase. The problem is when it starts feeding 90 00:04:10,720 --> 00:04:14,880 Speaker 4: into inflation expectations, and when people aren't sure that these 91 00:04:14,960 --> 00:04:17,359 Speaker 4: tariffs are here to stay, or whether there might be 92 00:04:17,400 --> 00:04:19,760 Speaker 4: some adjustments along the way, they have to start pricing 93 00:04:19,800 --> 00:04:22,880 Speaker 4: in the potential for more coming along in their supply chains. 94 00:04:23,760 --> 00:04:28,200 Speaker 4: At the same time, you've got the suppliers the from 95 00:04:28,279 --> 00:04:31,360 Speaker 4: abroad looking for other markets to sell into where they 96 00:04:31,360 --> 00:04:35,560 Speaker 4: may face fewer tariff barriers, and that's going to throw 97 00:04:35,600 --> 00:04:37,440 Speaker 4: things off as well in terms of the price and 98 00:04:37,440 --> 00:04:39,440 Speaker 4: the balance of supply and demand. And then on top 99 00:04:39,480 --> 00:04:42,559 Speaker 4: of that, with the immigration crackdown, you've got a labor 100 00:04:42,560 --> 00:04:45,440 Speaker 4: supply that may be more contracted and that will probably 101 00:04:45,440 --> 00:04:47,320 Speaker 4: feed through into wage increases next year. So I think 102 00:04:47,360 --> 00:04:50,360 Speaker 4: there's a lot for interest for the President to look at. 103 00:04:50,360 --> 00:04:53,680 Speaker 2: And of course the spral if you consider the wage well, 104 00:04:53,760 --> 00:04:55,960 Speaker 2: it's certainly another wave of things. Whether it gets out 105 00:04:56,000 --> 00:04:59,760 Speaker 2: of hand beyond that or not, it's certainly not. It's 106 00:04:59,760 --> 00:05:04,360 Speaker 2: a it's an inflation fuel rather than rather than a 107 00:05:04,720 --> 00:05:07,800 Speaker 2: So if you're Jay Powell, you're still pulling your hair out. 108 00:05:08,120 --> 00:05:10,520 Speaker 2: Maybe some folks thought are on Liberation Day this would 109 00:05:10,520 --> 00:05:12,599 Speaker 2: be subtled. A lot of it is not, which you 110 00:05:12,720 --> 00:05:16,560 Speaker 2: have already established so I guess a quarter points in 111 00:05:16,560 --> 00:05:18,800 Speaker 2: the books today. Tell me if you see it differently. 112 00:05:18,839 --> 00:05:22,240 Speaker 2: But there's still great uncertainty about what happens after this 113 00:05:22,360 --> 00:05:23,200 Speaker 2: last meeting of the year. 114 00:05:23,400 --> 00:05:24,919 Speaker 4: I think there's a lot of uncertainty. I think that 115 00:05:25,120 --> 00:05:28,239 Speaker 4: is the problem for well. Jay Powell is probably circling 116 00:05:28,240 --> 00:05:30,240 Speaker 4: that date in May when he can go on to 117 00:05:30,320 --> 00:05:32,400 Speaker 4: whatever he comes out next, and maybe he decides to 118 00:05:32,440 --> 00:05:34,640 Speaker 4: say or maybe he doesn't as a member of the committee. 119 00:05:34,680 --> 00:05:37,680 Speaker 2: But I think these are the easy cuts. 120 00:05:37,880 --> 00:05:40,360 Speaker 4: Right when we came from nine percent down to three 121 00:05:40,400 --> 00:05:45,480 Speaker 4: percent in terms of headline inflation, to keep FED funds 122 00:05:45,520 --> 00:05:47,200 Speaker 4: rates at five or four. 123 00:05:47,440 --> 00:05:48,400 Speaker 2: Seems a little high. 124 00:05:48,800 --> 00:05:51,200 Speaker 4: But I think now as you get closer with the 125 00:05:51,320 --> 00:05:54,839 Speaker 4: cut today to three percent inflation, and we're sort of 126 00:05:54,839 --> 00:05:57,240 Speaker 4: below three percent right now. But if these tariffs do 127 00:05:57,320 --> 00:05:59,600 Speaker 4: come through next year, if we have a spike in 128 00:05:59,640 --> 00:06:03,680 Speaker 4: oils or other commodity prices next year, and we have 129 00:06:04,120 --> 00:06:06,840 Speaker 4: pretty resilient consumer demand, which I think most people are 130 00:06:06,880 --> 00:06:10,560 Speaker 4: penciling in because of potential for text cuts, because of 131 00:06:10,640 --> 00:06:13,480 Speaker 4: other benefits in the One Big. 132 00:06:13,400 --> 00:06:15,719 Speaker 2: Beautiful Bill Act that takes effect at the beginning of 133 00:06:15,720 --> 00:06:16,039 Speaker 2: the year. 134 00:06:16,960 --> 00:06:18,760 Speaker 4: So I think it's going to be a much trickier 135 00:06:18,839 --> 00:06:22,520 Speaker 4: path for the FED to look at three ish inflation 136 00:06:22,680 --> 00:06:25,320 Speaker 4: and say, gosh, the closer we get to that, and 137 00:06:25,480 --> 00:06:27,680 Speaker 4: we certainly don't want to go below three percent if. 138 00:06:27,600 --> 00:06:30,360 Speaker 2: Inflation is persistent. There right, Jay pal is pretty worried 139 00:06:30,400 --> 00:06:32,040 Speaker 2: about the job market right now, and I know that's 140 00:06:32,040 --> 00:06:33,960 Speaker 2: another big question mark going in the next year. He's 141 00:06:34,000 --> 00:06:35,640 Speaker 2: got to stand in front of a room with the 142 00:06:35,720 --> 00:06:38,000 Speaker 2: likes of Michael McKee and everyone to answer questions about 143 00:06:38,000 --> 00:06:40,600 Speaker 2: all this stuff today with less data to work with 144 00:06:40,760 --> 00:06:43,360 Speaker 2: than maybe he's ever had, at least recent data going 145 00:06:43,400 --> 00:06:46,080 Speaker 2: into one of these meetings. Could this be a short 146 00:06:46,120 --> 00:06:48,799 Speaker 2: news conference? What could he possibly say? 147 00:06:49,640 --> 00:06:53,800 Speaker 4: Well, I think he's got a problem to fill time, because, 148 00:06:53,839 --> 00:06:56,200 Speaker 4: as you say, the data is not there. But you know, 149 00:06:56,440 --> 00:06:59,080 Speaker 4: there is a lot of non governmental data that we've 150 00:06:59,120 --> 00:07:00,720 Speaker 4: all been piecing together, and we can. 151 00:07:00,680 --> 00:07:02,880 Speaker 2: Chew on the Beige Book and ADP all day long. 152 00:07:02,960 --> 00:07:06,440 Speaker 2: But I you know, I also wonder about the political 153 00:07:06,560 --> 00:07:08,800 Speaker 2: layers that are being added on top of the FED. Here. 154 00:07:08,839 --> 00:07:12,160 Speaker 2: The president's doing his final interviews apparently as we speak, 155 00:07:12,200 --> 00:07:16,000 Speaker 2: with this meeting taking place. It's been widely reported by 156 00:07:16,040 --> 00:07:18,240 Speaker 2: Bloomberg that Kevin Hassett is at the top of the 157 00:07:18,280 --> 00:07:20,120 Speaker 2: list here. Is there such a thing as a lame 158 00:07:20,240 --> 00:07:24,040 Speaker 2: duck FED chair? Well, I think it's always difficult in 159 00:07:24,120 --> 00:07:26,200 Speaker 2: the end of any FED chair. I'm just car in 160 00:07:26,240 --> 00:07:28,640 Speaker 2: trouble now, but I think it is. 161 00:07:28,680 --> 00:07:31,520 Speaker 4: You know, it's a difficult time for investors to look at. 162 00:07:31,720 --> 00:07:35,280 Speaker 4: I think you know, most investors are still looking at 163 00:07:35,280 --> 00:07:37,760 Speaker 4: those headline inflation numbers and those headline growth numbers. 164 00:07:38,480 --> 00:07:40,440 Speaker 2: The FED drama. 165 00:07:40,080 --> 00:07:42,160 Speaker 4: In the background is on their minds, but I don't 166 00:07:42,200 --> 00:07:44,160 Speaker 4: think it's at the top of the list right now. 167 00:07:44,640 --> 00:07:47,640 Speaker 4: And so again, it's more a question of what happens 168 00:07:47,720 --> 00:07:50,800 Speaker 4: when the next FED chair takes charge. How much do 169 00:07:50,840 --> 00:07:54,320 Speaker 4: they trust when they get close to that three percent number? 170 00:07:54,400 --> 00:07:57,640 Speaker 4: How dubvish is the new FED going to be? How 171 00:07:57,840 --> 00:07:59,880 Speaker 4: effective will the new FED chair be in bringing the 172 00:08:00,040 --> 00:08:03,040 Speaker 4: midy around, Because it's not just the one vote that matters, 173 00:08:03,040 --> 00:08:05,240 Speaker 4: it's being able to steer the committee in the right direction. 174 00:08:05,560 --> 00:08:08,600 Speaker 2: What are you hearing about the culture inside the FED 175 00:08:09,160 --> 00:08:12,400 Speaker 2: when they go behind closed doors for a two day meeting, Like, 176 00:08:12,920 --> 00:08:15,200 Speaker 2: is this the group of survivors? You know, we're all 177 00:08:15,280 --> 00:08:18,239 Speaker 2: under fire here out there where we've got something in common? 178 00:08:18,440 --> 00:08:22,960 Speaker 2: Or are there factions like the like the cafeteria in 179 00:08:23,040 --> 00:08:26,440 Speaker 2: grade school where Stephen Myron doesn't even have a table 180 00:08:26,520 --> 00:08:27,040 Speaker 2: to sit at. 181 00:08:27,480 --> 00:08:30,120 Speaker 4: Well, I'm not sure it's quite like grade school cafeteria, 182 00:08:30,560 --> 00:08:33,079 Speaker 4: but it is very new, I think for a FED 183 00:08:33,160 --> 00:08:34,719 Speaker 4: to look so divided. And that's one of the things 184 00:08:34,720 --> 00:08:37,400 Speaker 4: that we'll be looking at today is the dot plot 185 00:08:37,600 --> 00:08:40,600 Speaker 4: to see how much dispersion there is among the forecasts 186 00:08:40,640 --> 00:08:43,560 Speaker 4: of the new members, and the more there is a 187 00:08:43,720 --> 00:08:47,360 Speaker 4: differentiated view of the way the economy works. Stephen Myron 188 00:08:47,400 --> 00:08:49,679 Speaker 4: has a very different view of what our star, what 189 00:08:49,720 --> 00:08:52,680 Speaker 4: the natural inflation rate is, what the natural interest rate is, 190 00:08:53,800 --> 00:08:56,040 Speaker 4: from a lot of the other mainstream economists. And I 191 00:08:56,040 --> 00:08:58,640 Speaker 4: think that's going to be the beginning of a pretty 192 00:08:58,640 --> 00:08:59,840 Speaker 4: fierce debate going forward. 193 00:09:00,000 --> 00:09:02,319 Speaker 2: What do people in the cocktail circuit. What are economists 194 00:09:02,360 --> 00:09:04,360 Speaker 2: saying about Kevin Hassett, Because this is a man who 195 00:09:04,400 --> 00:09:06,880 Speaker 2: had a lot of respect. He was an economic advisor 196 00:09:06,920 --> 00:09:10,320 Speaker 2: on the McCain campaign. He's worked in multiple administrations, but 197 00:09:10,400 --> 00:09:13,199 Speaker 2: he's taken on a slightly different role in the public sphere, 198 00:09:13,320 --> 00:09:17,360 Speaker 2: essentially finding himself on cable news every day defending the president. 199 00:09:17,960 --> 00:09:20,280 Speaker 2: And he's gone to great lengths to defend the president's 200 00:09:20,280 --> 00:09:22,880 Speaker 2: economic policies. Will he be seen as a political animal 201 00:09:22,880 --> 00:09:23,640 Speaker 2: if he gets the job. 202 00:09:24,080 --> 00:09:25,400 Speaker 4: Well, first of all, thank you for thinking that. I 203 00:09:25,440 --> 00:09:26,719 Speaker 4: spent a lot of time in the contum I know, 204 00:09:27,160 --> 00:09:30,680 Speaker 4: but I think he's in a box. I mean, he 205 00:09:30,800 --> 00:09:32,960 Speaker 4: is a capable economist, he has done a lot of 206 00:09:32,960 --> 00:09:36,560 Speaker 4: work over the years. But no matter what he does, 207 00:09:36,720 --> 00:09:39,079 Speaker 4: it's going to be hard for him to differentiate himself 208 00:09:39,160 --> 00:09:42,280 Speaker 4: from this role as being a partisan advocate for the 209 00:09:42,280 --> 00:09:47,680 Speaker 4: president's policies to being a neutral judge of what the. 210 00:09:47,679 --> 00:09:49,760 Speaker 2: Appropriate instrates are going to be. Is the market open 211 00:09:49,840 --> 00:09:51,040 Speaker 2: for a surprise on this? Then? 212 00:09:51,679 --> 00:09:53,920 Speaker 4: Well, again, it sort of depends on what the numbers 213 00:09:53,960 --> 00:09:57,160 Speaker 4: look like. You know, there's a viable case where inflation 214 00:09:57,240 --> 00:10:00,360 Speaker 4: will drift lower from here and so few more rate 215 00:10:00,440 --> 00:10:03,920 Speaker 4: cuts will make sense and the market will accept that, 216 00:10:04,000 --> 00:10:04,520 Speaker 4: and you know. 217 00:10:04,600 --> 00:10:05,400 Speaker 2: Things will be fine. 218 00:10:05,440 --> 00:10:07,920 Speaker 4: But I think again, when push comes to shove and 219 00:10:07,960 --> 00:10:11,040 Speaker 4: you've got the president making social media posts at night 220 00:10:11,559 --> 00:10:14,520 Speaker 4: and the FED meeting the next day, how that new 221 00:10:14,559 --> 00:10:16,920 Speaker 4: FED chair balances though, is going to be very difficult. 222 00:10:16,960 --> 00:10:21,000 Speaker 2: Wouldn't want that job? The question is, because of course, 223 00:10:21,040 --> 00:10:23,960 Speaker 2: it's one voice in a room of many expert voices. 224 00:10:24,000 --> 00:10:28,280 Speaker 2: The question that we keep hearing come up on this program, Christopher, 225 00:10:28,360 --> 00:10:33,360 Speaker 2: is whether he can lead to consensus. Do you think 226 00:10:33,360 --> 00:10:36,680 Speaker 2: he can? Well, we'll see. I think he's got to 227 00:10:36,720 --> 00:10:38,640 Speaker 2: be able to do that. And again, I think the. 228 00:10:38,600 --> 00:10:41,120 Speaker 4: Problem is he comes from a few of his more 229 00:10:41,160 --> 00:10:45,160 Speaker 4: recent roles as being very partisan, supporting the president, supporting 230 00:10:45,160 --> 00:10:48,360 Speaker 4: the Republican agenda as it is today, and stepping out 231 00:10:48,400 --> 00:10:51,640 Speaker 4: of that to become more balanced in his judgment. 232 00:10:52,080 --> 00:10:53,800 Speaker 2: I think time will tell it. I think it'll be 233 00:10:54,360 --> 00:10:58,920 Speaker 2: it'll take some work on his part to do that, 234 00:10:59,000 --> 00:11:01,880 Speaker 2: both with his FED color but also with the market, 235 00:11:02,120 --> 00:11:05,440 Speaker 2: the market, the market audience. It's amazing how much we 236 00:11:05,480 --> 00:11:08,120 Speaker 2: still don't know about what form this FED will take 237 00:11:08,160 --> 00:11:11,280 Speaker 2: in the months ahead. Christopher Smart, our growth group, thank 238 00:11:11,280 --> 00:11:12,760 Speaker 2: you so much. It's great to see you, Betua, the 239 00:11:12,840 --> 00:11:15,240 Speaker 2: nation's capital. I was up in your fair city last weekend, 240 00:11:15,280 --> 00:11:17,160 Speaker 2: the great city of Boston. It's a special time a 241 00:11:17,240 --> 00:11:19,560 Speaker 2: year up there, and I wish you happy holidays. I 242 00:11:19,559 --> 00:11:23,480 Speaker 2: hope it's beautiful the next couple of weeks in Boston, Massachusetts. 243 00:11:23,520 --> 00:11:26,040 Speaker 2: I'm Joe Matthew in Washington. We'll assemble to our political 244 00:11:26,080 --> 00:11:29,000 Speaker 2: panel next only on Bloomberg. Stay with us on Balance 245 00:11:29,040 --> 00:11:31,199 Speaker 2: of Power. We'll have much more coming up after this. 246 00:11:35,520 --> 00:11:39,000 Speaker 1: You're listening to the Bloomberg Balance of Power Podcast. Catch 247 00:11:39,080 --> 00:11:42,120 Speaker 1: us live weekdays at noon and five pm Eastern on 248 00:11:42,240 --> 00:11:45,480 Speaker 1: Apple Cockway and Android Auto with the Bloomberg Business App. 249 00:11:45,520 --> 00:11:48,520 Speaker 1: You can also listen live on Amazon Alexa from our 250 00:11:48,559 --> 00:11:53,040 Speaker 1: flagship New York station, Just Say Alexa played Bloomberg eleven thirty. 251 00:11:54,520 --> 00:11:58,560 Speaker 2: The mount Airy Resort and Casino in the Pocono Mountains 252 00:11:58,720 --> 00:12:01,400 Speaker 2: was the scene of the speech last evening, the first 253 00:12:01,400 --> 00:12:04,520 Speaker 2: and what we're told will be a series of campaign 254 00:12:04,559 --> 00:12:09,079 Speaker 2: style rallies addresses to voters by the President of the 255 00:12:09,160 --> 00:12:14,440 Speaker 2: United States on the issue of affordability. Ninety minutes and 256 00:12:14,520 --> 00:12:17,400 Speaker 2: it was the greatest hits. He did talk about affordability. 257 00:12:17,720 --> 00:12:21,120 Speaker 2: He also mocked affordability and got through a range of 258 00:12:21,120 --> 00:12:24,640 Speaker 2: different issues in this period of time, talking about everything 259 00:12:26,160 --> 00:12:30,880 Speaker 2: from Somalia to what he said back in twenty eighteen 260 00:12:31,760 --> 00:12:34,679 Speaker 2: about certain African nations. We'll get to that in a minute. 261 00:12:34,720 --> 00:12:38,040 Speaker 2: The point is it was a noisy speech. The President 262 00:12:39,200 --> 00:12:41,880 Speaker 2: was in full campaign rally mode, and there are questions 263 00:12:41,920 --> 00:12:44,079 Speaker 2: as he reminded the crowd that he didn't even want 264 00:12:44,120 --> 00:12:45,880 Speaker 2: to give that speech. He only did it cause Susie 265 00:12:45,880 --> 00:12:48,080 Speaker 2: Wiles forced him to. There are questions about whether this 266 00:12:48,120 --> 00:12:50,320 Speaker 2: is going to be effective. We talked about it coming 267 00:12:50,360 --> 00:12:52,360 Speaker 2: in Let's do it now coming out with our political panel. 268 00:12:52,400 --> 00:12:56,480 Speaker 2: Bloomberg Politics contributors Genie Shanzino and Rick Davis are with us. 269 00:12:56,559 --> 00:12:59,280 Speaker 2: Rick is our Republican strategist partner at Stone Court Capital. 270 00:13:00,080 --> 00:13:03,520 Speaker 2: Chanzo remembering when Joe Biden tried some of this as 271 00:13:03,559 --> 00:13:07,080 Speaker 2: our Democratic analyst and democracy visiting fellow at Harvard Kennedy 272 00:13:07,080 --> 00:13:10,600 Speaker 2: School's Ash Center. Hey, Genie, is this going better based 273 00:13:10,640 --> 00:13:12,160 Speaker 2: on what you saw last night at least for Donald 274 00:13:12,200 --> 00:13:13,440 Speaker 2: Trump than it was for Joe Biden? 275 00:13:15,040 --> 00:13:17,360 Speaker 5: It is not Joe And I think did he call 276 00:13:17,400 --> 00:13:20,319 Speaker 5: her Susie Trump last night a few times as well? 277 00:13:20,400 --> 00:13:24,040 Speaker 5: So Susie whilst hey listen, I love words too. 278 00:13:24,160 --> 00:13:25,079 Speaker 6: But it was good. 279 00:13:26,040 --> 00:13:29,120 Speaker 5: You know. She said that he doesn't know it yet, 280 00:13:29,120 --> 00:13:31,200 Speaker 5: but he's going to be out on the campaign trail 281 00:13:31,559 --> 00:13:34,719 Speaker 5: for the midterm like it's twenty twenty four. And if 282 00:13:34,840 --> 00:13:38,240 Speaker 5: yesterday or last night was any indication that is not 283 00:13:38,480 --> 00:13:42,320 Speaker 5: a good strategy. Not just what happened at this rally, 284 00:13:42,840 --> 00:13:46,599 Speaker 5: but also what happened in Florida and in Georgia, and 285 00:13:46,679 --> 00:13:52,880 Speaker 5: these elections where Republicans are underperforming. So Donald Trump consistently 286 00:13:52,960 --> 00:13:57,040 Speaker 5: telling people everything's good, you only need to have He 287 00:13:57,080 --> 00:13:59,240 Speaker 5: brought up again your favorite Joe, the dolls. 288 00:13:59,280 --> 00:14:01,440 Speaker 6: You only need a couple dolls. 289 00:14:02,000 --> 00:14:06,720 Speaker 5: This is not working. This is not working, and the 290 00:14:06,760 --> 00:14:07,600 Speaker 5: polls show it. 291 00:14:08,800 --> 00:14:11,679 Speaker 2: He brought up the pencils as well, which we were 292 00:14:11,720 --> 00:14:16,000 Speaker 2: exploring a little while ago with Stuart Paul. You don't 293 00:14:16,040 --> 00:14:19,400 Speaker 2: need thirty seven dollars for your daughter, and you don't 294 00:14:19,480 --> 00:14:23,200 Speaker 2: need all the pencils. He said, only one should be enough. 295 00:14:23,800 --> 00:14:28,440 Speaker 2: He twice called affordability a hoax Rick and then said 296 00:14:28,440 --> 00:14:31,320 Speaker 2: that he's no longer allowed to use that phrase. What 297 00:14:31,400 --> 00:14:35,320 Speaker 2: was the impact of this speech, Well, it's got. 298 00:14:35,200 --> 00:14:38,640 Speaker 7: Us talking about it, So I think that was part 299 00:14:38,800 --> 00:14:41,720 Speaker 7: of the strategy, was to try and change the narrative. 300 00:14:42,960 --> 00:14:44,760 Speaker 7: He wasn't having a great narrative in the month of 301 00:14:44,800 --> 00:14:49,240 Speaker 7: November and December, and they've been sort of off on 302 00:14:49,360 --> 00:14:54,000 Speaker 7: various tangents for quite some time. And so this was 303 00:14:54,240 --> 00:14:57,560 Speaker 7: at least the staff strategy of getting him out there 304 00:14:57,600 --> 00:15:02,080 Speaker 7: talking about cost of living and affordable problem is they 305 00:15:02,120 --> 00:15:05,960 Speaker 7: didn't tell him what to say about it obviously. I mean, like, yeah, 306 00:15:06,000 --> 00:15:07,720 Speaker 7: I'm sure he got back to the lighthouse. 307 00:15:07,720 --> 00:15:08,680 Speaker 3: I see I said. 308 00:15:08,520 --> 00:15:12,320 Speaker 7: Affordability fourteen times. If you can't call it a hoax 309 00:15:12,400 --> 00:15:15,520 Speaker 7: fourteen times and think you're going to get anywhere, Yeah, 310 00:15:15,600 --> 00:15:18,360 Speaker 7: I mean, I think message discipline is going to be 311 00:15:18,360 --> 00:15:20,800 Speaker 7: a really hot issue in this White House for the 312 00:15:20,840 --> 00:15:24,480 Speaker 7: next year, because clearly they've made a decision based on 313 00:15:24,520 --> 00:15:28,720 Speaker 7: what he said last night that he believes he's on 314 00:15:28,760 --> 00:15:32,200 Speaker 7: the ballot in twenty six and if I would, you know, 315 00:15:32,280 --> 00:15:34,520 Speaker 7: if I were running a campaign right now, you know, 316 00:15:34,920 --> 00:15:38,440 Speaker 7: I wish he were, because there's no proof that without 317 00:15:38,520 --> 00:15:42,960 Speaker 7: him on the ballot, these sort of new Republican voters 318 00:15:42,960 --> 00:15:45,280 Speaker 7: that came in through MEGA are going to show. 319 00:15:45,160 --> 00:15:45,640 Speaker 2: Up to vote. 320 00:15:46,560 --> 00:15:49,440 Speaker 7: They are one every four years voters and they've always 321 00:15:49,520 --> 00:15:52,440 Speaker 7: has been and that's not new to Trump. So when 322 00:15:52,480 --> 00:15:56,440 Speaker 7: they've signed on with MAGA, you know, what MEGA signed 323 00:15:56,480 --> 00:16:00,360 Speaker 7: on to was a very difficult off your election strategy, 324 00:16:00,960 --> 00:16:04,720 Speaker 7: and so I get it. It's the strategy saying, you know, 325 00:16:04,920 --> 00:16:08,120 Speaker 7: most presidents would run away from a midterm. He's going 326 00:16:08,200 --> 00:16:12,000 Speaker 7: to lean in because you know, without him making this 327 00:16:12,120 --> 00:16:15,080 Speaker 7: about him, he can't rely on these voters to show 328 00:16:15,160 --> 00:16:16,880 Speaker 7: up and then a lot of Democrats are going to 329 00:16:16,920 --> 00:16:21,440 Speaker 7: get elected and it's going to really derail his second 330 00:16:21,520 --> 00:16:22,600 Speaker 7: two years in office. 331 00:16:23,800 --> 00:16:27,840 Speaker 2: Rick mentions message discipline, and yes, we are talking about 332 00:16:27,840 --> 00:16:30,200 Speaker 2: the speech. The president certainly got a lot of eyeballs. 333 00:16:30,200 --> 00:16:33,280 Speaker 2: But I guess one of the issues might be the 334 00:16:33,360 --> 00:16:36,600 Speaker 2: parts that are going viral. They're not about affordability. They're 335 00:16:36,640 --> 00:16:40,840 Speaker 2: not even about tariffs in this case, a brutal attack 336 00:16:41,600 --> 00:16:44,640 Speaker 2: on the Somalian community. Again, he had some very long 337 00:16:44,640 --> 00:16:47,760 Speaker 2: passages about immigration and veered into a lot of topics 338 00:16:47,800 --> 00:16:52,120 Speaker 2: like that that really were not central to the affordability message, 339 00:16:52,800 --> 00:16:55,840 Speaker 2: and even confirmed reports that he had denied about the 340 00:16:55,840 --> 00:16:59,160 Speaker 2: comments he made about some African and Asian nations. Let's 341 00:16:59,160 --> 00:17:00,160 Speaker 2: go back to the really here. 342 00:17:01,000 --> 00:17:03,280 Speaker 3: They say, why is it we only take people from 343 00:17:03,640 --> 00:17:05,520 Speaker 3: own countries? Right? 344 00:17:06,640 --> 00:17:10,680 Speaker 2: Why can't we have some people from Norway? Sweeten? Just 345 00:17:10,760 --> 00:17:15,119 Speaker 2: a few? Let us have a few from Denmark? Do 346 00:17:15,160 --> 00:17:17,560 Speaker 2: you mind sending us a few people, send us some 347 00:17:17,680 --> 00:17:20,879 Speaker 2: nice people, do you mind? But we always take. 348 00:17:20,760 --> 00:17:26,480 Speaker 3: People from semi places that are a disaster, right, filthy 349 00:17:26,520 --> 00:17:28,120 Speaker 3: dirty discuss they ridden with. 350 00:17:28,119 --> 00:17:33,680 Speaker 2: Crime, filthy dirty, disgusting. Genni Back in twenty eighteen, when 351 00:17:33,680 --> 00:17:36,159 Speaker 2: it had been reported that he used that term to 352 00:17:36,200 --> 00:17:40,000 Speaker 2: describe African and Asian nations. He denied it, called it 353 00:17:40,040 --> 00:17:44,200 Speaker 2: fake news and reported by the enemy of the American people. 354 00:17:44,240 --> 00:17:46,159 Speaker 2: He was boasting about it last night. Should we take 355 00:17:46,240 --> 00:17:46,800 Speaker 2: him at his word? 356 00:17:48,800 --> 00:17:50,960 Speaker 5: This has been Donald Trump since he came down the 357 00:17:51,000 --> 00:17:52,560 Speaker 5: elevator in twenty sixteen. 358 00:17:52,640 --> 00:17:55,119 Speaker 6: There is nothing new here. We have it on tape 359 00:17:55,160 --> 00:17:56,240 Speaker 6: over and over again. 360 00:17:56,600 --> 00:17:59,800 Speaker 5: He resorts to this kind of rhetoric when he's gotten 361 00:18:00,160 --> 00:18:03,240 Speaker 5: thing else to offer, because he thinks he is going 362 00:18:03,320 --> 00:18:05,720 Speaker 5: to be able to rile up his base and get 363 00:18:05,760 --> 00:18:08,840 Speaker 5: them out to vote. But the problem is the results, 364 00:18:08,880 --> 00:18:12,399 Speaker 5: at least this year, are showing something completely different. You 365 00:18:12,480 --> 00:18:16,200 Speaker 5: look down at that Miami mayor's race where he endorsed 366 00:18:16,200 --> 00:18:19,240 Speaker 5: the Republican candidate who lost by double digits to the 367 00:18:19,240 --> 00:18:20,600 Speaker 5: first Democrats since. 368 00:18:20,440 --> 00:18:22,960 Speaker 6: Nineteen ninety eight, the first female. 369 00:18:23,280 --> 00:18:25,560 Speaker 5: And what did she run on, Joe, She ran, of 370 00:18:25,560 --> 00:18:29,679 Speaker 5: course on affordability, but in particular on these ice raids, 371 00:18:29,760 --> 00:18:33,439 Speaker 5: on the treatment of immigrants. This is something we are 372 00:18:33,520 --> 00:18:37,280 Speaker 5: seeing writ large across the country as we have an 373 00:18:37,280 --> 00:18:41,639 Speaker 5: ice that is out picking up young college age freshman 374 00:18:41,960 --> 00:18:45,600 Speaker 5: in Logan Airport and transporting them against a judge's ruling 375 00:18:45,960 --> 00:18:48,200 Speaker 5: back to a country they haven't been to since they 376 00:18:48,200 --> 00:18:50,960 Speaker 5: were a child. We have a report out from Amnesty 377 00:18:51,040 --> 00:18:57,520 Speaker 5: International yesterday describing the conditions at Alcatraz Ali as deplorable 378 00:18:57,640 --> 00:19:01,480 Speaker 5: violations of human rights. Taken an issue that he was 379 00:19:01,560 --> 00:19:04,880 Speaker 5: okay on and doing pretty well on and he has 380 00:19:05,000 --> 00:19:08,399 Speaker 5: turned it around. And why because of his treatment and 381 00:19:08,480 --> 00:19:12,760 Speaker 5: this rhetoric is another reminder of his treatment of immigrants 382 00:19:12,760 --> 00:19:16,040 Speaker 5: and migrants to this country, which most people in the 383 00:19:16,160 --> 00:19:22,399 Speaker 5: Moderate and Independence don't find particularly appealing, and which is 384 00:19:22,760 --> 00:19:26,600 Speaker 5: costing the Republicans elections like we saw in Miami yesterday. 385 00:19:27,680 --> 00:19:31,479 Speaker 2: How you reading this Miami race Rick Eileen Higgins, the 386 00:19:31,520 --> 00:19:36,080 Speaker 2: first Democratic mayor in nearly thirty years, as a heck 387 00:19:36,119 --> 00:19:39,800 Speaker 2: of a headline fifty nine percent according to the unofficial results. 388 00:19:40,280 --> 00:19:43,800 Speaker 2: Emilio Gonzalez had about forty percent. He was supported by 389 00:19:43,800 --> 00:19:46,240 Speaker 2: Trump and DeSantis. Is there a message here or is 390 00:19:46,280 --> 00:19:47,000 Speaker 2: this a one off? 391 00:19:48,280 --> 00:19:50,800 Speaker 7: You know, it's a little bit of a Canaryan in 392 00:19:50,880 --> 00:19:55,119 Speaker 7: Nicole mine. This should have been a no brainer. Republican 393 00:19:55,160 --> 00:19:59,720 Speaker 7: control of Florida has become a standard right. Nobody Democrats 394 00:20:00,280 --> 00:20:03,399 Speaker 7: even want to run there anymore. And to see something 395 00:20:03,480 --> 00:20:07,159 Speaker 7: like this happen in the municipality. Look, it's it's a 396 00:20:07,400 --> 00:20:11,400 Speaker 7: ceremonial at best mayor's race. 397 00:20:11,440 --> 00:20:13,920 Speaker 2: It's not Dade County, right and so. 398 00:20:14,520 --> 00:20:17,040 Speaker 7: But you know, the Republican was a Cuban that should 399 00:20:17,040 --> 00:20:20,080 Speaker 7: have ensured victory on its own. Just from the demographics, 400 00:20:20,920 --> 00:20:24,200 Speaker 7: Cuban community tends to be monolithic in their voting patterns, 401 00:20:24,320 --> 00:20:26,760 Speaker 7: and there are a lot of them in this jurisdiction. 402 00:20:27,560 --> 00:20:29,760 Speaker 2: So yeah, I think it's I think it's a wake 403 00:20:29,840 --> 00:20:30,160 Speaker 2: up call. 404 00:20:30,440 --> 00:20:34,119 Speaker 7: I don't think it compares to what we saw last November, 405 00:20:34,240 --> 00:20:39,879 Speaker 7: where you know, Democrats swept state houses and you know, 406 00:20:40,000 --> 00:20:44,359 Speaker 7: in in two important electoral states. I think that's the message. 407 00:20:44,720 --> 00:20:47,920 Speaker 7: You know, Republicans need to be understanding. But this certainly 408 00:20:48,440 --> 00:20:51,119 Speaker 7: is consistent with that, and that is we're not getting 409 00:20:51,119 --> 00:20:53,920 Speaker 7: our votes out. People aren't happy with what we're doing. 410 00:20:53,960 --> 00:20:56,400 Speaker 7: I don't think this was an immigration vote. She ran 411 00:20:56,480 --> 00:21:01,320 Speaker 7: on the winner. Democrat ran on corruption and cut and 412 00:21:01,359 --> 00:21:03,440 Speaker 7: red tape so that we can have more real estate 413 00:21:03,440 --> 00:21:06,560 Speaker 7: development in the city. I mean, like, I don't buy 414 00:21:06,640 --> 00:21:10,760 Speaker 7: that that's the narrative that this anti immigration narrative is 415 00:21:11,440 --> 00:21:14,600 Speaker 7: played out in this race. Maybe others, for sure, but 416 00:21:14,640 --> 00:21:15,280 Speaker 7: not this one. 417 00:21:16,280 --> 00:21:18,320 Speaker 2: Are we too quick to try to turn every race 418 00:21:18,359 --> 00:21:21,680 Speaker 2: into a bellweather here, Jeanie, We've got some time before 419 00:21:21,680 --> 00:21:23,960 Speaker 2: the midterms, some. 420 00:21:24,040 --> 00:21:24,600 Speaker 6: Time to go. 421 00:21:25,400 --> 00:21:28,000 Speaker 5: You know, yeah, you can't read too much into any 422 00:21:28,040 --> 00:21:30,720 Speaker 5: single one, But if you look at the totality of 423 00:21:30,760 --> 00:21:33,240 Speaker 5: the races we have seen, both the specials and the 424 00:21:33,280 --> 00:21:34,600 Speaker 5: off year elections this. 425 00:21:34,560 --> 00:21:37,320 Speaker 6: Year, they have been all moving in the. 426 00:21:37,280 --> 00:21:43,480 Speaker 5: Democratic into the Democratic side. Even those that Democrats have lost, 427 00:21:43,560 --> 00:21:47,280 Speaker 5: they have been much too close for comfort. And you know, 428 00:21:47,680 --> 00:21:51,560 Speaker 5: I disagree with Rick. You look at her messaging. She 429 00:21:51,840 --> 00:21:55,720 Speaker 5: was very very much focused on the ice raids and 430 00:21:55,800 --> 00:21:58,600 Speaker 5: you look at that, and that tells you something he 431 00:21:58,760 --> 00:22:02,359 Speaker 5: is not in. Republicans are not just vulnerable on the economy, 432 00:22:02,400 --> 00:22:03,919 Speaker 5: where they are very vulnerable. 433 00:22:04,240 --> 00:22:06,040 Speaker 6: They are also vulnerable on what. 434 00:22:06,119 --> 00:22:10,200 Speaker 5: Has been his go to issue, which is immigration, and 435 00:22:10,600 --> 00:22:15,040 Speaker 5: people are seeing their neighbors treated in a deplorable way. 436 00:22:15,320 --> 00:22:18,840 Speaker 5: It has been consistent messaging on the Democratic side. You 437 00:22:18,880 --> 00:22:21,439 Speaker 5: look at the New York City Democratic races coming up. 438 00:22:21,640 --> 00:22:24,600 Speaker 5: That's what they're messaging on. It's across the country and 439 00:22:24,680 --> 00:22:28,840 Speaker 5: it is registering with independence, moderates and Democrats in a 440 00:22:28,880 --> 00:22:31,440 Speaker 5: way that this was always a winning mess you message 441 00:22:31,480 --> 00:22:34,600 Speaker 5: for him and issue for him, it is not anymore 442 00:22:34,640 --> 00:22:35,840 Speaker 5: with the overreach of ICE. 443 00:22:37,920 --> 00:22:39,479 Speaker 2: I've got to ask you both because we're walking up 444 00:22:39,480 --> 00:22:41,960 Speaker 2: on a FED decision here. We've been talking about affordability 445 00:22:42,000 --> 00:22:45,960 Speaker 2: for the most part. Over the course of this hour, Rick, 446 00:22:46,000 --> 00:22:48,840 Speaker 2: we get a quarter point cut. It looks like today, 447 00:22:49,440 --> 00:22:51,840 Speaker 2: do you expect anything that will follow or market's going 448 00:22:51,880 --> 00:22:52,600 Speaker 2: to be disappointed? 449 00:22:54,280 --> 00:22:56,800 Speaker 7: You know, I can't tell what the market reaction to 450 00:22:56,880 --> 00:23:00,800 Speaker 7: this will be. It's everything I've listened to on Bloomberg 451 00:23:00,880 --> 00:23:03,879 Speaker 7: this morning indicates it's kind of baked into the equation. 452 00:23:04,600 --> 00:23:07,920 Speaker 7: But what I would hope what happen is the President 453 00:23:08,040 --> 00:23:11,680 Speaker 7: and his economic advisors go out and see say see 454 00:23:11,760 --> 00:23:14,760 Speaker 7: we told you so, we got it. We're cutting those 455 00:23:14,840 --> 00:23:17,320 Speaker 7: rates and this is a huge success for the Trump 456 00:23:17,400 --> 00:23:20,920 Speaker 7: administration and it's going to bring down cost of housing 457 00:23:21,040 --> 00:23:25,639 Speaker 7: and other things that are credit sensitive. And I just 458 00:23:25,640 --> 00:23:27,600 Speaker 7: wish they'd make it a positive instead of saying, oh, 459 00:23:27,640 --> 00:23:30,040 Speaker 7: it should have been more right. I mean, like part 460 00:23:30,119 --> 00:23:33,879 Speaker 7: of the imagery around people feeling comfortabout the economy is 461 00:23:33,920 --> 00:23:36,120 Speaker 7: that some of what you're doing in the first year 462 00:23:36,160 --> 00:23:39,720 Speaker 7: of office is actually having an impact. The White House 463 00:23:39,720 --> 00:23:41,840 Speaker 7: should take a victory lap today if the rates. 464 00:23:41,840 --> 00:23:46,960 Speaker 2: Get cut interesting, Genie. We only have thirty seconds. Elizabeth 465 00:23:47,000 --> 00:23:48,720 Speaker 2: Warren is going to say it's time to keep cutting 466 00:23:48,720 --> 00:23:49,800 Speaker 2: after this, right, how about you? 467 00:23:52,200 --> 00:23:54,439 Speaker 5: Yeah? Maybe I am very excited to see what the 468 00:23:54,440 --> 00:23:57,440 Speaker 5: Fed does today, Joe, but I'm most excited to hear you. 469 00:23:57,480 --> 00:23:59,680 Speaker 6: With Gene Simmons coming up, I have. 470 00:23:59,760 --> 00:24:01,040 Speaker 2: To thank you. It's wow. 471 00:24:01,359 --> 00:24:03,560 Speaker 6: Running for my head. It's gonna be great. 472 00:24:04,240 --> 00:24:07,280 Speaker 2: That's great you and I both Since the Kennedy Center 473 00:24:07,320 --> 00:24:10,880 Speaker 2: Honors on Sunday night, guys, he's in the building, Rick 474 00:24:10,960 --> 00:24:14,119 Speaker 2: Davis and Genie Shanzano and Gene Simmons on the same show. 475 00:24:14,800 --> 00:24:17,320 Speaker 2: This might be the pinnacle right here, I'm Joe, Matthew 476 00:24:17,359 --> 00:24:19,879 Speaker 2: and Washington. This better be Bloomberg. 477 00:24:22,680 --> 00:24:26,160 Speaker 1: You're listening to the Bloomberg Balance of Power podcast. Catch 478 00:24:26,240 --> 00:24:30,160 Speaker 1: us live weekdays at noon and five pm Eastern on Apple, Coarcklay, 479 00:24:30,200 --> 00:24:33,240 Speaker 1: and Android Auto with the Bloomberg Business App. Listen on 480 00:24:33,280 --> 00:24:36,560 Speaker 1: demand wherever you get your podcasts, or watch us live 481 00:24:36,640 --> 00:24:37,320 Speaker 1: on YouTube. 482 00:24:38,960 --> 00:24:42,760 Speaker 2: Thank you and welcome to the Wednesday edition of Balance 483 00:24:42,800 --> 00:24:44,639 Speaker 2: of Power. I had to think for a minute because 484 00:24:44,720 --> 00:24:47,800 Speaker 2: time has become abstract. Just take a look around and 485 00:24:47,840 --> 00:24:50,560 Speaker 2: see what's happening in Washington this week. Of course, we're 486 00:24:50,560 --> 00:24:53,040 Speaker 2: always here for you in the nation's capital on Bloomberg 487 00:24:53,080 --> 00:24:54,920 Speaker 2: TV and Radio, as we try to connect the dots 488 00:24:54,920 --> 00:24:57,600 Speaker 2: between Washington and Wall Street and today ahead of our 489 00:24:57,640 --> 00:25:00,159 Speaker 2: special FED coverage and before we start boring down of 490 00:25:00,200 --> 00:25:03,000 Speaker 2: the Fed and interest rates later on in the program, 491 00:25:03,480 --> 00:25:07,200 Speaker 2: we zero in specifically on the connection between Washington and 492 00:25:07,240 --> 00:25:10,720 Speaker 2: the music industry regulation. And I'll point you no further 493 00:25:11,600 --> 00:25:14,480 Speaker 2: than an op ed in the Washington Post the headline Congress, 494 00:25:14,520 --> 00:25:16,880 Speaker 2: I have a plea for you. It was written by 495 00:25:16,960 --> 00:25:20,640 Speaker 2: Gene Simmons. Yes, that Gene Simmons, who was on stage 496 00:25:20,680 --> 00:25:23,200 Speaker 2: at the Kennedy Center last weekend the Kennedy Center Awards. 497 00:25:23,240 --> 00:25:25,119 Speaker 2: He saw him in the Oval Office with Donald Trump, 498 00:25:25,600 --> 00:25:28,880 Speaker 2: and you also saw him testifying on Capitol Hill yesterday 499 00:25:29,200 --> 00:25:33,600 Speaker 2: before the Judiciary Committee for something called the AMFA Act. 500 00:25:33,600 --> 00:25:37,480 Speaker 2: This is about music fairness, royalties. Listen to what he said. 501 00:25:38,440 --> 00:25:41,959 Speaker 3: How do we dare come in second to Russia, an 502 00:25:42,040 --> 00:25:46,399 Speaker 3: alleged country led by a despot, when they do a 503 00:25:46,440 --> 00:25:49,520 Speaker 3: better job of paying our king of rock and roll, 504 00:25:49,760 --> 00:25:53,080 Speaker 3: And we're going to stand by and not pay today's 505 00:25:53,200 --> 00:25:56,960 Speaker 3: artists and future artists because, let's face it, Our children 506 00:25:57,240 --> 00:26:01,560 Speaker 3: are tomorrow's stars. It got to chase now for our 507 00:26:01,720 --> 00:26:04,920 Speaker 3: children and our children's children, and I know you will. 508 00:26:05,240 --> 00:26:09,560 Speaker 3: The President will sign this once all you guys respectfully 509 00:26:09,600 --> 00:26:12,960 Speaker 3: get your act together and put this across the board. 510 00:26:13,040 --> 00:26:15,160 Speaker 3: Let's do the right thing. God bless America. 511 00:26:16,280 --> 00:26:20,639 Speaker 2: He's talking about the American Music Fairness Acts, proposed legislation 512 00:26:21,840 --> 00:26:23,840 Speaker 2: that may or may not get a floor vote, but 513 00:26:23,920 --> 00:26:25,840 Speaker 2: of course with the support of the President, that would 514 00:26:25,880 --> 00:26:28,119 Speaker 2: go a long way. It's got the support of Gene Simmons, 515 00:26:28,200 --> 00:26:30,560 Speaker 2: and he's with us right now in studio. You spent 516 00:26:30,600 --> 00:26:33,000 Speaker 2: the week in Washington. Thanks for making us part of it. 517 00:26:33,080 --> 00:26:38,240 Speaker 3: Well, it's my pleasure and people are shocked. I'll try 518 00:26:38,240 --> 00:26:42,160 Speaker 3: to encapsulate what all this is for. I know that's 519 00:26:42,200 --> 00:26:46,560 Speaker 3: a big word like gymnasium. Look, I don't care what 520 00:26:46,680 --> 00:26:51,160 Speaker 3: kind of music you listen to, but the American music, 521 00:26:51,560 --> 00:26:54,960 Speaker 3: let's just stop at that point. American music means we 522 00:26:55,119 --> 00:27:00,440 Speaker 3: created and invested, invented the music of planet Earth. Rock 523 00:27:00,480 --> 00:27:05,240 Speaker 3: and roll, blues, jazz, hip hop, country and Western all 524 00:27:05,280 --> 00:27:09,560 Speaker 3: invented and created here. Our stars are the stars of 525 00:27:09,760 --> 00:27:13,439 Speaker 3: planet Earth. You can go to Africa and hear you 526 00:27:13,480 --> 00:27:17,440 Speaker 3: ain't nothing about it. No matter where you go. Every Christmas, 527 00:27:17,880 --> 00:27:21,040 Speaker 3: everywhere around the world, people listen to Bing Crosby I'm 528 00:27:21,119 --> 00:27:26,600 Speaker 3: Dreaming of a White Christmas, written by Irving Berlin. The astonishing, 529 00:27:27,280 --> 00:27:31,200 Speaker 3: stunning and shameful fact is that no matter who you 530 00:27:31,320 --> 00:27:36,680 Speaker 3: hear on AM and FM radio, they're getting zero pennies 531 00:27:37,119 --> 00:27:41,040 Speaker 3: for the airplay. So let's play a game. Who's your 532 00:27:41,040 --> 00:27:49,280 Speaker 3: favorite recording artist? Kiss no, come on, somebody from the past. Well, 533 00:27:49,520 --> 00:27:53,399 Speaker 3: Jimmy Hendrix. Jimmy Hendrix. Jimmy Hendrix has never in his 534 00:27:53,680 --> 00:27:58,199 Speaker 3: entire career or now ever gotten paid a single penny 535 00:27:58,720 --> 00:28:02,240 Speaker 3: when his music is played on AM and FM radio. 536 00:28:02,960 --> 00:28:08,160 Speaker 3: The stunning fact is that the Russians and some other 537 00:28:08,240 --> 00:28:15,160 Speaker 3: countries actually do pay performing artists on radio land radio, AMFM, 538 00:28:15,600 --> 00:28:18,359 Speaker 3: and Americans do not. And this has got to change 539 00:28:18,400 --> 00:28:21,560 Speaker 3: and should change. Look, I make a living, and people 540 00:28:22,840 --> 00:28:25,159 Speaker 3: of my age and you know who've climbed the mountain, 541 00:28:25,280 --> 00:28:28,560 Speaker 3: clawed and scratched their way to the top. We're blessed 542 00:28:28,600 --> 00:28:31,120 Speaker 3: by the American dream because it is alive and I'm 543 00:28:31,160 --> 00:28:34,040 Speaker 3: living proof of it. So I make a living. But 544 00:28:34,200 --> 00:28:38,120 Speaker 3: the new artists, every penny counts, and the fact that 545 00:28:38,160 --> 00:28:41,000 Speaker 3: they can be played on radio and not even make 546 00:28:41,160 --> 00:28:45,800 Speaker 3: one penny for their performance is criminal. 547 00:28:45,840 --> 00:28:47,640 Speaker 2: So as far as zing to a lot of people, 548 00:28:47,760 --> 00:28:49,400 Speaker 2: we're on the radio right now. You see that big 549 00:28:49,480 --> 00:28:51,120 Speaker 2: radio mic in front of you there with such a 550 00:28:51,120 --> 00:28:53,680 Speaker 2: good radio show, Gene. They put it on TV. And 551 00:28:53,720 --> 00:28:55,720 Speaker 2: I've been knocking around the radio business for a minute. 552 00:28:55,760 --> 00:28:58,600 Speaker 2: We hear about BMI and ASCAP fees. Has this always 553 00:28:58,640 --> 00:29:01,440 Speaker 2: been the case or was it simple in exchange? You 554 00:29:01,480 --> 00:29:05,520 Speaker 2: play my music for exposure for publicity, and I sell 555 00:29:05,560 --> 00:29:08,040 Speaker 2: tickets and I sell albums, and that's now out of balance? 556 00:29:08,080 --> 00:29:12,080 Speaker 3: Is that what happened? Artists are not interested in negotiating 557 00:29:12,120 --> 00:29:15,280 Speaker 3: how their careers are built, understand radio needs. 558 00:29:15,880 --> 00:29:17,960 Speaker 2: Where did the recording RDMI fees go? 559 00:29:18,240 --> 00:29:24,120 Speaker 3: ASCAP and BMI specifically relates to writers and publishers, which 560 00:29:24,160 --> 00:29:26,520 Speaker 3: doesn't affect the masses whatsoever. 561 00:29:26,600 --> 00:29:29,680 Speaker 2: So is this radio's fault? Your contract with the record company? 562 00:29:29,720 --> 00:29:32,160 Speaker 2: How come the middleman hasn't given you nothing. 563 00:29:32,040 --> 00:29:34,560 Speaker 3: To do with the record company because they make money 564 00:29:34,560 --> 00:29:39,840 Speaker 3: when they sell records and writers and producers. This is 565 00:29:39,920 --> 00:29:43,440 Speaker 3: the actual recording artist. You like Elvis, you like Sinatra? 566 00:29:43,800 --> 00:29:47,240 Speaker 3: When you hear that song on the radio, the people 567 00:29:47,320 --> 00:29:49,800 Speaker 3: we tune in for actually never get paid. 568 00:29:49,920 --> 00:29:50,320 Speaker 2: Amazing. 569 00:29:50,760 --> 00:29:54,000 Speaker 3: Everybody else gets paid, the writers and the publishers and 570 00:29:54,040 --> 00:29:59,560 Speaker 3: the advertising dollars. Radio last year made fourteen billion dollars. 571 00:29:59,600 --> 00:30:02,920 Speaker 3: You know how much of that went to the Sinatra state, 572 00:30:03,040 --> 00:30:06,240 Speaker 3: or tab and Paula or all the new beds. 573 00:30:06,320 --> 00:30:10,600 Speaker 2: I think I'm getting zero. Okay, that's in contrast to 574 00:30:11,120 --> 00:30:14,360 Speaker 2: satellite radio. But talking about no I know, but I 575 00:30:14,400 --> 00:30:17,240 Speaker 2: just want to square that you're suggesting the radio industry 576 00:30:17,280 --> 00:30:20,880 Speaker 2: is behind the times because all of these other platforms anything. 577 00:30:20,960 --> 00:30:26,640 Speaker 3: I'm stating fact that AMFM radio is well, I want 578 00:30:26,680 --> 00:30:30,120 Speaker 3: to use language that doesn't get anybody legal and involved 579 00:30:30,560 --> 00:30:35,440 Speaker 3: in the Patua. The street is criminal. You cannot The 580 00:30:35,600 --> 00:30:38,880 Speaker 3: America is based on the premise that if you work hard, 581 00:30:39,200 --> 00:30:42,080 Speaker 3: you should get paid. So everybody's getting paid. When a 582 00:30:42,200 --> 00:30:47,600 Speaker 3: radio station AMMFM broadcasts, The executives get paid, the advertisers 583 00:30:47,680 --> 00:30:50,440 Speaker 3: pay money. The billboards on the street which use our 584 00:30:50,560 --> 00:30:53,760 Speaker 3: name and likeness for free. If you use my name 585 00:30:53,840 --> 00:30:57,680 Speaker 3: and likeness otherwise, I would take your firstborn and your house. 586 00:30:58,200 --> 00:31:01,600 Speaker 3: But radio is allowed to do that. They keep fourteen billion. 587 00:31:01,800 --> 00:31:04,840 Speaker 3: And the new artist, by the way, who's trying hard 588 00:31:04,920 --> 00:31:07,360 Speaker 3: to make it, is not going to make those precious 589 00:31:07,480 --> 00:31:11,000 Speaker 3: pennies to help them survive. And that's as far as 590 00:31:11,080 --> 00:31:13,560 Speaker 3: I'm concerned. My opinion is it's criminal. 591 00:31:13,920 --> 00:31:16,640 Speaker 2: Listeners you write in the op ed are more likely 592 00:31:16,720 --> 00:31:20,120 Speaker 2: today to discover new music on Spotify, Apple, YouTube, TikTok. 593 00:31:20,160 --> 00:31:22,600 Speaker 2: At the same time, more and more local stations have 594 00:31:22,720 --> 00:31:25,840 Speaker 2: been bought up by big corporations like iHeart and Odyssey. 595 00:31:26,000 --> 00:31:28,800 Speaker 2: They still play the music without paying the artists, often 596 00:31:28,920 --> 00:31:32,760 Speaker 2: hits that listeners already know in order to generate ad revenue. I've, 597 00:31:32,960 --> 00:31:34,800 Speaker 2: as I mentioned, worked in radio for a while. I've 598 00:31:34,840 --> 00:31:41,160 Speaker 2: seen rampant consolidation in this business. Has that made it worse? Well, 599 00:31:41,240 --> 00:31:42,000 Speaker 2: one way or the other. 600 00:31:42,120 --> 00:31:45,040 Speaker 3: Whether it's consolidated you or a potential page, the result 601 00:31:45,400 --> 00:31:48,000 Speaker 3: is the same. A truck runs you over and the 602 00:31:48,040 --> 00:31:50,800 Speaker 3: guy comes out and says, I'm sorry, I ran you over. 603 00:31:51,160 --> 00:31:53,320 Speaker 3: I didn't mean to do it, or I don't like you, 604 00:31:53,480 --> 00:31:55,880 Speaker 3: I ran you over. What's the difference you've been run over? 605 00:31:56,360 --> 00:32:00,320 Speaker 3: So the question is an interesting dialectic and other word 606 00:32:00,440 --> 00:32:05,320 Speaker 3: like nasum. The result is nothing's changed. The artists are 607 00:32:05,440 --> 00:32:10,640 Speaker 3: not getting paid that I mean especially our children and 608 00:32:10,800 --> 00:32:13,600 Speaker 3: our children's children are going to be the next generation 609 00:32:14,240 --> 00:32:17,120 Speaker 3: superstars after they climb their way to the top and 610 00:32:17,240 --> 00:32:19,200 Speaker 3: five Ford, what do they have forward to? 611 00:32:19,280 --> 00:32:19,480 Speaker 5: Look? 612 00:32:19,760 --> 00:32:20,240 Speaker 7: What do they have? 613 00:32:20,720 --> 00:32:21,880 Speaker 2: You know? Looking forward? 614 00:32:22,440 --> 00:32:25,800 Speaker 3: They're going to get zero pennies when their songs are 615 00:32:25,920 --> 00:32:28,720 Speaker 3: played on AM and FM radio, and that's insane. 616 00:32:28,920 --> 00:32:31,040 Speaker 2: Do you have the president's support on this? Did you 617 00:32:31,040 --> 00:32:31,680 Speaker 2: talk to them about it? 618 00:32:32,240 --> 00:32:34,800 Speaker 3: I spent some time with the President alone in the 619 00:32:34,880 --> 00:32:40,480 Speaker 3: Oval Office, and we talked about family and I've known 620 00:32:40,520 --> 00:32:44,680 Speaker 3: the President, proud to say before he became a politician. 621 00:32:45,280 --> 00:32:49,240 Speaker 3: But what else we talked about is a private issue. Okay, 622 00:32:49,360 --> 00:32:51,560 Speaker 3: So that wasn't about legislation. I guess I didn't say 623 00:32:51,600 --> 00:32:55,400 Speaker 3: that's what you're leading the witness. You're honor saying these 624 00:32:55,440 --> 00:32:57,440 Speaker 3: are semantics, but I'm not anti semantic. 625 00:32:57,840 --> 00:32:59,600 Speaker 2: We hope that you're not, because we wouldn't be able 626 00:32:59,640 --> 00:33:00,520 Speaker 2: to let you led. 627 00:33:00,800 --> 00:33:03,640 Speaker 3: It was a little clickbait there. What I talked, Yes, 628 00:33:03,800 --> 00:33:06,680 Speaker 3: I specifically said what I spoke with the President about 629 00:33:07,480 --> 00:33:11,040 Speaker 3: is not for anybody else's consumption. Okay, Well, there is 630 00:33:11,120 --> 00:33:12,240 Speaker 3: such a thing as privacy. 631 00:33:12,360 --> 00:33:14,400 Speaker 2: I completely understand. I only ask you because so many 632 00:33:14,480 --> 00:33:16,479 Speaker 2: lawmakers come on the air and say, if we get 633 00:33:16,520 --> 00:33:18,720 Speaker 2: a directive from the president, we can make this work. 634 00:33:18,800 --> 00:33:21,000 Speaker 2: What did you hear in the committee from members? Did 635 00:33:21,040 --> 00:33:22,600 Speaker 2: you get to center a lot of votes on this. 636 00:33:22,760 --> 00:33:26,440 Speaker 2: I've heard a lot of support. I met privately with 637 00:33:26,720 --> 00:33:31,800 Speaker 2: the Senator Marshall Blackman and mister Schiff, both sides of 638 00:33:31,920 --> 00:33:36,640 Speaker 2: the aisle seem let's just say, as soon as Congress 639 00:33:36,800 --> 00:33:39,640 Speaker 2: gets their act together, the President will sign this. 640 00:33:40,480 --> 00:33:43,200 Speaker 3: I am convinced of it. My personal opinion. 641 00:33:43,360 --> 00:33:45,240 Speaker 2: Well, our audience should know, and you're talking to the 642 00:33:45,280 --> 00:33:47,960 Speaker 2: business community right now that you are no stranger to 643 00:33:48,080 --> 00:33:50,720 Speaker 2: big business and some pretty shrewd moves. It was a 644 00:33:50,760 --> 00:33:53,320 Speaker 2: Bloomberg report when you sold your publishing rights last year 645 00:33:54,080 --> 00:33:56,120 Speaker 2: House Entertainment three entire million dollars. 646 00:33:56,240 --> 00:34:01,840 Speaker 3: That's not entirely accurate, so just here to correct it 647 00:34:01,960 --> 00:34:06,720 Speaker 3: for the record. An entity called Pophouse, a futuristic company 648 00:34:06,760 --> 00:34:10,760 Speaker 3: out of Sweden, came and bought Kiss the underlying rights, 649 00:34:10,880 --> 00:34:14,520 Speaker 3: the makeup logos as well as the writing publishing, for 650 00:34:16,239 --> 00:34:20,440 Speaker 3: a respectable sum enough to buy Rhode Island. I give 651 00:34:20,440 --> 00:34:22,800 Speaker 3: you a pregnant pause so that it sinks in. But 652 00:34:23,560 --> 00:34:27,840 Speaker 3: the future looks even more gargantuan than the past. We 653 00:34:27,960 --> 00:34:30,920 Speaker 3: are in the middle of the first motion picture to 654 00:34:31,040 --> 00:34:34,840 Speaker 3: be directed by McGee. There's an awful lot of stuff 655 00:34:34,920 --> 00:34:38,080 Speaker 3: that I can't talk about because nobody wants to find 656 00:34:38,120 --> 00:34:40,239 Speaker 3: out where they're going to get for Christmas in July. 657 00:34:41,480 --> 00:34:45,560 Speaker 3: There is an enormous commitment by Pophouse in the future 658 00:34:45,600 --> 00:34:48,160 Speaker 3: of Kiss. And this is just the beginning. When you 659 00:34:48,239 --> 00:34:50,360 Speaker 3: look at a caterpillar and you say, well, that's the 660 00:34:50,440 --> 00:34:53,960 Speaker 3: end of its life. No, you're shortsighted. You don't understand 661 00:34:54,400 --> 00:34:56,719 Speaker 3: that it's going into a cocoon, which is where we 662 00:34:56,800 --> 00:34:59,440 Speaker 3: are now, and we're going to come out and defy 663 00:34:59,600 --> 00:35:03,400 Speaker 3: gravity with beautiful wings and sort of the heavens. 664 00:35:03,840 --> 00:35:04,440 Speaker 2: Very poetic. 665 00:35:05,280 --> 00:35:06,479 Speaker 3: I am kind of a big deal. 666 00:35:06,640 --> 00:35:08,400 Speaker 2: I should I've heard that in a poet. 667 00:35:08,680 --> 00:35:10,880 Speaker 3: I was a fan actually of Bloomberg when he was 668 00:35:11,000 --> 00:35:14,880 Speaker 3: a mayor, met the gentleman and he struck me as 669 00:35:14,920 --> 00:35:16,279 Speaker 3: a powerful and attractive man. 670 00:35:16,440 --> 00:35:19,520 Speaker 2: Well, I can only agree with that, and I loved. 671 00:35:19,320 --> 00:35:22,080 Speaker 3: His algorithm that made him rich and fish. But that's 672 00:35:22,120 --> 00:35:22,800 Speaker 3: another story. 673 00:35:23,160 --> 00:35:25,000 Speaker 2: Well, i'll tell you what we've got the terminal right here. 674 00:35:25,360 --> 00:35:27,560 Speaker 2: I'm sure there's a disclaimer I'm supposed to read somewhere, 675 00:35:27,600 --> 00:35:30,400 Speaker 2: But with everything you just described, you just outline the 676 00:35:30,440 --> 00:35:32,399 Speaker 2: future of the music business. Why are you chasing down 677 00:35:32,440 --> 00:35:33,040 Speaker 2: the old format? 678 00:35:34,440 --> 00:35:38,400 Speaker 3: Well, look, the old formats are if they worked and 679 00:35:38,520 --> 00:35:43,160 Speaker 3: they were justified, should should and would continue. But tell 680 00:35:43,239 --> 00:35:45,799 Speaker 3: me what your retort is, even though I know you're 681 00:35:45,840 --> 00:35:51,960 Speaker 3: not retorted. How do you how do you validate our stars, 682 00:35:52,200 --> 00:35:55,720 Speaker 3: the people fought their way to the top, never getting 683 00:35:56,040 --> 00:35:59,719 Speaker 3: a scent for radio airplay. How do you validate that 684 00:36:00,200 --> 00:36:04,160 Speaker 3: while radio is making fourteen billion dollars? Again, I'm not 685 00:36:04,400 --> 00:36:08,080 Speaker 3: demonizing them as bears, noting we need each other, but 686 00:36:08,600 --> 00:36:14,120 Speaker 3: somewhere between paying artists zero and fourteen billion dollars, there 687 00:36:14,200 --> 00:36:17,280 Speaker 3: should be a Remember, the name of the act is Fairness, 688 00:36:17,760 --> 00:36:21,480 Speaker 3: American Music Fairness Act. You should let me talk more. 689 00:36:21,560 --> 00:36:25,200 Speaker 3: I can increase your you know, more people will watch 690 00:36:25,320 --> 00:36:27,240 Speaker 3: this instead of SpongeBob square Pats. 691 00:36:27,280 --> 00:36:29,600 Speaker 2: I wan believe that. That's why you're here. I guess 692 00:36:29,640 --> 00:36:33,879 Speaker 2: this much time, Besan Simmons. Okay, so you said a lot. Well, 693 00:36:33,920 --> 00:36:36,440 Speaker 2: we consider the future of the music business. Do you 694 00:36:36,520 --> 00:36:39,440 Speaker 2: worry about AI regulation? Do you worry about these FACO 695 00:36:39,600 --> 00:36:42,279 Speaker 2: bands coming up? Speaking of algorithms, And by the way, 696 00:36:42,360 --> 00:36:46,440 Speaker 2: Mike Bloomberg is not only the boss here but founder 697 00:36:46,520 --> 00:36:49,480 Speaker 2: chairman Bloomberg LP. That's right, AI is a worry for 698 00:36:49,560 --> 00:36:49,880 Speaker 2: you or not. 699 00:36:50,480 --> 00:36:56,480 Speaker 3: AI is a concern if left unregulated, anything or beautiful 700 00:36:56,560 --> 00:36:59,320 Speaker 3: horse that you just bring in if it runs wild. 701 00:36:59,719 --> 00:37:03,200 Speaker 3: You got to have some parameters that we control instead 702 00:37:03,200 --> 00:37:05,960 Speaker 3: of AI. Right now, there's a country in Western Star 703 00:37:06,440 --> 00:37:09,160 Speaker 3: that's got a number one record of sorts on some 704 00:37:09,480 --> 00:37:11,400 Speaker 3: chart doesn't actually exist. 705 00:37:11,920 --> 00:37:14,400 Speaker 2: What do you think, Well, well, let me just go. 706 00:37:15,000 --> 00:37:20,160 Speaker 3: The major problem here, potentially, hypothetically and otherwise is that 707 00:37:20,440 --> 00:37:23,520 Speaker 3: if states have the right and this has to be 708 00:37:23,840 --> 00:37:27,640 Speaker 3: settled right away, the government must get a federal law 709 00:37:27,719 --> 00:37:31,600 Speaker 3: that encompasses all of AI to get some sanity out 710 00:37:31,640 --> 00:37:36,239 Speaker 3: of this. Because if you can do AI legally in 711 00:37:36,440 --> 00:37:39,160 Speaker 3: Delaware where you have all your companies so you don't 712 00:37:39,200 --> 00:37:41,839 Speaker 3: pay so you pay less taxes because you're a very 713 00:37:41,920 --> 00:37:46,200 Speaker 3: bright man besides being good looking, why should they want 714 00:37:46,239 --> 00:37:49,479 Speaker 3: to do real music and real art in New York 715 00:37:49,560 --> 00:37:51,759 Speaker 3: when they can just go to Delaware and do AI. No, 716 00:37:52,040 --> 00:37:56,080 Speaker 3: you need a federal law that encompasses the entire country, 717 00:37:56,880 --> 00:37:59,600 Speaker 3: and I would highly recommend, and I would hope the 718 00:37:59,760 --> 00:38:03,360 Speaker 3: entire planet really gets together. It's an issue for the 719 00:38:03,520 --> 00:38:06,640 Speaker 3: UN to get a world body to accept it, because 720 00:38:06,640 --> 00:38:09,000 Speaker 3: it's going to happen to the same same thing that 721 00:38:09,120 --> 00:38:12,000 Speaker 3: happened to the unions in America. You charge too much here, 722 00:38:12,080 --> 00:38:14,719 Speaker 3: so we'll do business in China. No, you want to 723 00:38:14,840 --> 00:38:19,560 Speaker 3: address the AI issue worldwide, so we can control what 724 00:38:19,760 --> 00:38:22,560 Speaker 3: the rules are, the comings and the going and what's 725 00:38:22,600 --> 00:38:26,120 Speaker 3: the income stream? Who owns the IP, who's the owner 726 00:38:26,200 --> 00:38:28,279 Speaker 3: of the trademark? At in for And I'd like to 727 00:38:28,320 --> 00:38:29,600 Speaker 3: announce that I'm running for. 728 00:38:32,360 --> 00:38:34,880 Speaker 2: If you were a kid, you bought a guitar, you 729 00:38:34,920 --> 00:38:37,080 Speaker 2: want to get in the music business, what would you 730 00:38:37,160 --> 00:38:38,000 Speaker 2: tell him, turn and run? 731 00:38:39,440 --> 00:38:44,040 Speaker 3: Well, I would tell anyone to do as I did, 732 00:38:45,080 --> 00:38:48,080 Speaker 3: which is to say to have a fallback position, because 733 00:38:48,160 --> 00:38:51,399 Speaker 3: anything that you pour your heart and soul into has 734 00:38:51,440 --> 00:38:54,759 Speaker 3: a pretty good chance, and that means likely ninety five 735 00:38:54,800 --> 00:38:58,600 Speaker 3: percent or more you will fail. And in my case, 736 00:38:58,680 --> 00:39:01,279 Speaker 3: I became a sixth grade tea and an assistant to 737 00:39:01,400 --> 00:39:05,200 Speaker 3: the editor of Vogue magazine Kate Lloyd, and the assistant 738 00:39:05,239 --> 00:39:09,360 Speaker 3: to the Puerto Rican Inteagency Council Magde Lena Miranda for 739 00:39:09,520 --> 00:39:13,640 Speaker 3: the Boorriqua community, where I did work for government research 740 00:39:13,680 --> 00:39:17,480 Speaker 3: and demonstration project Adam Fremidem ad Nausium. In other words, 741 00:39:18,040 --> 00:39:22,040 Speaker 3: if your thing doesn't work out. What's the backdrop, like, 742 00:39:22,200 --> 00:39:24,959 Speaker 3: I know you took ballet lessons. If this doesn't work 743 00:39:25,000 --> 00:39:27,959 Speaker 3: out and I, you know, do your I'm not keeping 744 00:39:28,080 --> 00:39:30,120 Speaker 3: up with it. Yeah, it's pretty cool for you to 745 00:39:30,200 --> 00:39:31,920 Speaker 3: be here, and I appreciate it very much. It is 746 00:39:32,000 --> 00:39:34,560 Speaker 3: the American Music Fairness Act. That's what he came here 747 00:39:34,640 --> 00:39:36,560 Speaker 3: to talk about. You don't need me to tell you. 748 00:39:36,800 --> 00:39:40,359 Speaker 3: Gene Simmons only here on Balance of Power. I hope 749 00:39:40,400 --> 00:39:43,080 Speaker 3: you enjoy the rest of the trip in Washington. Many 750 00:39:43,160 --> 00:39:44,040 Speaker 3: thanks for being with us. 751 00:39:44,160 --> 00:39:46,800 Speaker 2: I'm Joe Matthew in the nation's capital, a conversation you 752 00:39:46,840 --> 00:39:49,400 Speaker 2: will only hear, especially on a fed day on Bloomberg's 753 00:39:49,400 --> 00:39:55,200 Speaker 2: TV and radio. Thanks for listening to the Balance of 754 00:39:55,280 --> 00:39:58,720 Speaker 2: Power podcast. Make sure to subscribe if you haven't already, 755 00:39:58,800 --> 00:40:02,080 Speaker 2: at Apple, Spotify, or wherever you get your podcasts, and 756 00:40:02,160 --> 00:40:04,799 Speaker 2: you can find us live every weekday from Washington, DC 757 00:40:04,920 --> 00:40:07,439 Speaker 2: at noontime Eastern at Bloomberg dot com.