WEBVTT - New Charges Against Trump; SEC Commissioner Talks Crypto 0:00:02.480 --> 0:00:03.000 Good morning. 0:00:03.080 --> 0:00:05.920 I'm Nathan Hager and I'm Karen Moscow. Here are the 0:00:05.960 --> 0:00:07.440 stories we're following today. 0:00:08.160 --> 0:00:11.760 We begin with politics this morning, because former President Donald 0:00:11.800 --> 0:00:15.640 Trump is now facing new obstruction charges in the criminal 0:00:15.680 --> 0:00:19.360 case over how he handled classified documents. Amy Morris begins 0:00:19.360 --> 0:00:22.120 our team coverage from our Bloomberg ninety nine one newsroom 0:00:22.160 --> 0:00:22.919 in Washington. 0:00:23.440 --> 0:00:27.120 These are new charges in the classified documents case, allegations 0:00:27.120 --> 0:00:30.920 that Trump and two employees tried to delete surveillance video 0:00:30.920 --> 0:00:33.800 footage at his Mara A Lago estate last year. In 0:00:33.880 --> 0:00:38.040 this latest indictment, prosecutors accused Trump of directing workers to 0:00:38.200 --> 0:00:41.240 erase footage of a storage room where the documents were kept, 0:00:41.640 --> 0:00:45.160 days after his lawyers received a subpoena for the footage. 0:00:45.280 --> 0:00:48.680 It also includes one additional count, accusing Trump of willful 0:00:48.760 --> 0:00:52.640 retention of national defense information. He's already pleaded not guilty 0:00:52.680 --> 0:00:55.800 and faces a May twentieth trial date in Washington. I'm 0:00:55.800 --> 0:00:57.240 Amy Morris, Bloomberg Daybreak. 0:00:57.360 --> 0:01:00.160 All right, Amy, thank you. All these new charges has 0:01:00.200 --> 0:01:03.200 put even more legal pressure on the former president. We 0:01:03.240 --> 0:01:06.080 continue our team cover to this story with Bloomberg Justice 0:01:06.120 --> 0:01:07.839 Department reporter Chris Strom. 0:01:08.440 --> 0:01:13.160 This most likely will extend the timeline for the Trump case. 0:01:13.480 --> 0:01:16.880 It's very possible that what Jack Smith is trying to 0:01:16.880 --> 0:01:21.120 do here is get Deolavera to flip on Trump, and 0:01:21.200 --> 0:01:24.880 by bringing these charges, he's looking to put pressure on 0:01:24.959 --> 0:01:29.080 Dale Lavera and have him break off from Trump. They're 0:01:29.120 --> 0:01:32.160 all lumped together now in the indictment, Trump, Walt Not 0:01:32.640 --> 0:01:36.319 and Dale Leavera. And at this point the Special Council 0:01:36.400 --> 0:01:38.480 is going forward with the prosecution. 0:01:38.400 --> 0:01:41.280 And Bloomberg's Chris Strom says there's still more legal trouble 0:01:41.319 --> 0:01:44.280 on the horizon for former President Trump, paways of potential 0:01:44.400 --> 0:01:47.560 third indictment over efforts to overturn the twenty twenty election 0:01:48.000 --> 0:01:49.720 where on that could come any day now. 0:01:49.920 --> 0:01:52.760 Now, there are new developments in geopolitics. This morning, Karen 0:01:52.840 --> 0:01:55.760 new tensions between the US and China, and this time 0:01:55.800 --> 0:01:58.840 they come by way of Hong Kong. The Washington Post 0:01:58.880 --> 0:02:01.360 is reporting that the White House is barring Hong Kong's 0:02:01.440 --> 0:02:04.800 leader John Lee from a major economic summit this fall. 0:02:04.880 --> 0:02:08.440 Bloomberg Daybreak Asia anchor Brian Curtis has more from Hong Kong. 0:02:08.960 --> 0:02:11.560 John Lee is sanctioned by the US for his role 0:02:11.639 --> 0:02:14.640 in Hong Kong's crackdown on civil liberties. The Post cited 0:02:14.639 --> 0:02:17.920 three unidentified US officials as saying Lee would be barred. 0:02:18.040 --> 0:02:21.079 Hong Kong government issued a statement saying the APEC meeting 0:02:21.120 --> 0:02:23.519 does not belong to any one country and the US 0:02:23.560 --> 0:02:27.720 should fulfill its responsibilities as a host. Now blacklisting Lee 0:02:27.760 --> 0:02:31.240 will surely raise tensions. The US recently condemned Hong Kong 0:02:31.320 --> 0:02:35.200 after it put bounties on eight democracy activists activists wanted 0:02:35.280 --> 0:02:39.600 under a Chinese national security law in Hong Kong. Brian Curtis, Bloomberg. 0:02:39.240 --> 0:02:40.680 Daybreak, Hi, Brian, thanks well. 0:02:40.680 --> 0:02:43.880 Turning to the markets now, we've seen bond and currency 0:02:43.919 --> 0:02:48.000 markets jolted overnight by the Bank of Japan. Global bonds 0:02:48.000 --> 0:02:50.919 fell after the BOJ announced more flexibility in its yield 0:02:50.960 --> 0:02:55.160 curve control policy, and that spurs speculation of more changes 0:02:55.240 --> 0:02:59.280 to come. Bloomberg macro strategist Mark Hudmore says letting long 0:02:59.360 --> 0:03:02.680 term interest rates rise above their cap was a surprisingly 0:03:02.800 --> 0:03:03.640 hawkish move. 0:03:04.400 --> 0:03:08.639 Effectively, what they've raised the hard cap to one percent, 0:03:08.680 --> 0:03:10.120 and even then they haven't said it's going to be 0:03:10.240 --> 0:03:13.000 unlimited purchases of jgb's out of one percent yield. It's 0:03:13.040 --> 0:03:15.280 just going to be daily purchases, so that's basically move 0:03:15.360 --> 0:03:17.639 the hard cup up from point five percent to one percent. 0:03:17.680 --> 0:03:20.240 That's a point five percent move there in that cap. 0:03:20.639 --> 0:03:23.960 And Bloomber's Mark Cudmore says loosening a yield curve control 0:03:24.080 --> 0:03:26.440 marks the first surprise move from the Bank of Japan's 0:03:26.440 --> 0:03:28.799 a new governor. It could make the yen a more 0:03:28.880 --> 0:03:31.480 volatile trade. In checking the yen right now, it's at 0:03:31.520 --> 0:03:34.279 one thirty nine point five to two against the dollar. 0:03:34.160 --> 0:03:36.840 And back here in the US, Karen earning season continues 0:03:36.880 --> 0:03:39.920 to rumble on with key guidance from Intel. The chip 0:03:39.920 --> 0:03:43.280 maker issued a bullish revenue forecast, indicating demand for computer 0:03:43.320 --> 0:03:46.800 components is improving. The outlook follows a slow start to 0:03:46.880 --> 0:03:48.960 the year and makes good on a promise from Intel 0:03:49.000 --> 0:03:51.800 management that the second half of twenty twenty three will 0:03:51.800 --> 0:03:54.200 show improvement and checking shares of Intel right now they 0:03:54.200 --> 0:03:56.640 are higher by nearly seven percent. 0:03:56.720 --> 0:03:58.880 And Nathan, we also got earnings from master Card, the 0:03:58.920 --> 0:04:02.280 company saying cardvolume rows more than expected to one point 0:04:02.280 --> 0:04:06.440 eight trillion dollars that beat estimates. MasterCard says overseas travel 0:04:06.480 --> 0:04:10.280 and other entertainment is primarily driving the increase. Earlier this week, 0:04:10.400 --> 0:04:13.880 Visa also noted that spending on its cards jumped and 0:04:13.960 --> 0:04:16.200 also cited hire volumes tied to travel. 0:04:16.320 --> 0:04:18.640 Okay, so while travel spending a peers healthy care and 0:04:18.640 --> 0:04:21.520 commercial real estate that's a different story. Now we're learning 0:04:21.640 --> 0:04:24.880 US office data are on track to set records, but 0:04:25.000 --> 0:04:28.200 for the wrong reason. Bloomberg's John Tucker explains. 0:04:28.120 --> 0:04:30.520 The amount of office space in the US is declining 0:04:30.520 --> 0:04:32.920 for what's likely the first time in history. The real 0:04:33.040 --> 0:04:36.359 estate services company Jones Langlessal. Says less than five million 0:04:36.360 --> 0:04:38.960 square feet of new offices broke round in the US 0:04:39.040 --> 0:04:42.359 so far this year, while fourteen point seven billion square 0:04:42.360 --> 0:04:45.280 feet has been removed as good mark what is believed 0:04:45.279 --> 0:04:48.040 to be the first net decline ever. The closest we 0:04:48.160 --> 0:04:51.240 came to negative inventory historically would have been during the 0:04:51.320 --> 0:04:54.320 height of the Great Depression. Among the reasons for the decline, 0:04:54.360 --> 0:04:56.919 employees have been slow to return in certain cities, and 0:04:57.000 --> 0:04:59.640 office owners are grappling with a pullback of demand for 0:04:59.720 --> 0:05:02.960 many tenants in New York. I'm John Tucker, Bloomberg Daybreak. 0:05:03.120 --> 0:05:05.760 All right, John, Thanks. We also have an important note 0:05:05.760 --> 0:05:09.320 from the airline industry. American Airlines and negotiators for its 0:05:09.360 --> 0:05:12.960 Pinelists union reached a preliminary agreement on a proposed contract. 0:05:13.320 --> 0:05:16.440 It'll include higher pay and benefits more closely aligned with 0:05:16.480 --> 0:05:18.520 a labor agreement at United Airlines. 0:05:18.720 --> 0:05:21.400 And if you've been feeling extra hot this July, it's 0:05:21.480 --> 0:05:23.560 not just in your head. This month is set to 0:05:23.600 --> 0:05:26.560 become the world's hottest on record, the first twenty one 0:05:26.640 --> 0:05:28.720 days of this month for the hottest three week period, 0:05:29.000 --> 0:05:33.080 with July six seeing its highest ever global average temperature. 0:05:36.279 --> 0:05:37.680 And now it's time to take a look at some 0:05:37.720 --> 0:05:39.560 of the other stories making news in New York and 0:05:39.640 --> 0:05:43.520 around the world with Bloomberg's Michael Barr. Happy Friday, Michael. 0:05:43.320 --> 0:05:46.080 Happy Friday to you, Nathan, and more. On the heat 0:05:46.120 --> 0:05:49.000 that you just mentioned, Excessive heat warnings remain in place 0:05:49.000 --> 0:05:50.800 for New York City and a lot of the Tri 0:05:50.880 --> 0:05:54.279 state area. Today, New York Mayor Eric Adams and we 0:05:54.320 --> 0:05:56.880 need to be clear when we talk about hot weather. 0:05:57.560 --> 0:06:00.840 Heat kills more New Yorkers every year than any other 0:06:01.000 --> 0:06:06.120 kind of extreme weather event, and access to cooling is 0:06:06.160 --> 0:06:09.320 a matter of life and death. Mayor Adam says the 0:06:09.320 --> 0:06:12.560 city has opened up five hundred cooling centers. A fifteen 0:06:12.640 --> 0:06:15.360 year old swimmer remains missing after going in the water 0:06:15.560 --> 0:06:19.320 off of Coney Island in Brooklyn. Lifeguards and witnesses saw 0:06:19.360 --> 0:06:21.760 two boys in distress in the water in a no 0:06:21.960 --> 0:06:25.760 swimming area of the beach. The fourteen year old was rescued, 0:06:25.760 --> 0:06:28.120 but the search was called off last night for the 0:06:28.160 --> 0:06:31.680 fifteen year old. President Biden had strong words for one 0:06:31.760 --> 0:06:35.440 US senator. Biden accused the Republican Party of undermining the 0:06:35.520 --> 0:06:39.680 US military my allowing Alabama Senator Tommy Tubberville to block 0:06:39.760 --> 0:06:44.400 hundreds of military appointments over the Pentagon's abortion policy, a. 0:06:44.400 --> 0:06:48.279 Growing cascade of damage and disruption, all because one senator 0:06:48.279 --> 0:06:51.720 from Alabama and forty eight Republicans refused to stand up 0:06:51.760 --> 0:06:54.880 to them to lift the blockade over the Pentagon policy 0:06:54.920 --> 0:06:58.680 offering servicemen and women their families access to reproductive healthcare 0:06:58.760 --> 0:07:01.680 rights they deserve if their station in states to deny it. 0:07:02.360 --> 0:07:06.200 Tubberville is protesting the Defense Department policy put in place 0:07:06.640 --> 0:07:09.720 that provides paid leave and reimburses costs for troops who 0:07:09.720 --> 0:07:12.280 travel to another state to get an abortion. The Biden 0:07:12.280 --> 0:07:15.680 administration is set to tighten fuel efficiency standards of alltomakers. 0:07:15.800 --> 0:07:17.960 Bloomberg's at Baxter reports. 0:07:17.920 --> 0:07:21.320 The proposed rule is expected to be applicable to years 0:07:21.360 --> 0:07:25.200 twenty twenty seven and beyond. The move comes as gasoline 0:07:25.200 --> 0:07:28.640 prices are rising again. Details have not been announced, but 0:07:28.720 --> 0:07:32.320 previous proposals have it an averaging fuel economy by brand 0:07:32.680 --> 0:07:36.320 at forty nine miles per gallon. It also will push 0:07:36.360 --> 0:07:38.880 for half of all vehicles sold in the US to 0:07:38.920 --> 0:07:43.080 be electric or emissions free by the end of the decade. 0:07:43.480 --> 0:07:47.400 It could be issued as early as today. In San Francisco, 0:07:47.440 --> 0:07:49.480 I'm at Baxter Bloomberg Daybreak. 0:07:49.080 --> 0:07:52.560 A founding member of the Eagles has died. Randy Meisner 0:07:52.560 --> 0:07:56.040 added high harmonies to some of the Eagles' favorites. 0:07:58.440 --> 0:08:02.560 To the Minute, along. 0:08:02.280 --> 0:08:04.800 With take It to the Limit. Meisner also gave us 0:08:04.920 --> 0:08:07.360 take It Easy and the best of my love. The 0:08:07.400 --> 0:08:11.280 band says. Meisner died of complications from COPD. Randy Meisner 0:08:11.360 --> 0:08:14.320 was seventy seven global news twenty four hours a day, 0:08:14.400 --> 0:08:17.239 powered by more than twenty seven hundred journalist and analysts 0:08:17.240 --> 0:08:20.360 over one hundred and twenty countries. How Michael Barr, this is Bloomberg. 0:08:20.000 --> 0:08:21.000 Nathan, Thanks Michael. 0:08:25.760 --> 0:08:28.800 Time now for the Bloomberg Sports update. Here's John Stashauer. 0:08:28.840 --> 0:08:30.640 All right, Nathan, we have an answer to the question 0:08:30.720 --> 0:08:32.920 surrounding the Mets the past several weeks. Will they be 0:08:33.040 --> 0:08:36.560 buyers or sellers at the trade deadline? They are sellers. 0:08:36.559 --> 0:08:38.920 They just traded their best reliever, David Robertson had the 0:08:38.960 --> 0:08:41.360 lowest era have any picture on the staff sent to 0:08:41.440 --> 0:08:43.760 Miami for two rookie minor leaguers. 0:08:43.760 --> 0:08:44.760 The Marlins are in it for. 0:08:44.679 --> 0:08:47.560 A wildcard playoff spot, and the Mets really are not. 0:08:47.600 --> 0:08:49.360 Although they didn't win last night at City Field, they 0:08:49.400 --> 0:08:52.000 scored twice in the eighth inning to top Washington two 0:08:52.040 --> 0:08:53.840 to one. The Yankees flates to let in Baltimore, and 0:08:53.840 --> 0:08:56.400 it said to me likely that Aaron Judge will be 0:08:56.440 --> 0:08:58.559 in the lineup out Since early June, with the injured 0:08:58.600 --> 0:09:00.400 toe of the Yanks two and a half game out 0:09:00.400 --> 0:09:03.080 of a playoff spot, the Angels are just behind the Yankees. 0:09:03.440 --> 0:09:06.480 Angels just had a doubleheader sweep in Detroit where the 0:09:06.600 --> 0:09:10.160 remarkable dual talents a show, Hey Otani, We're on full display, 0:09:10.200 --> 0:09:13.360 a complete game, one hit shutout on the mound and 0:09:13.440 --> 0:09:15.760 the opener, and then two home runs at the plate 0:09:16.120 --> 0:09:19.120 in the nightcap. But Giants training camp Saquon Barkley's first 0:09:19.120 --> 0:09:22.440 comments since his decision to accept the one year franchise 0:09:22.480 --> 0:09:23.960 tag and not hold out. 0:09:25.400 --> 0:09:28.080 Some people may agree or disagree with this and you know, 0:09:28.360 --> 0:09:30.360 sit out or sit in, and I feel like for 0:09:30.440 --> 0:09:32.600 it this year specifically, the best thing that I can 0:09:32.640 --> 0:09:37.679 do for myself would be coming back, going out there 0:09:37.640 --> 0:09:39.920 and play the game that I love, playing for my teammates, 0:09:41.360 --> 0:09:42.240 doing something I want to do. 0:09:42.280 --> 0:09:44.480 So this little kid, Barkley called it in Epiff and 0:09:44.559 --> 0:09:46.760 A Giants did sweeten the deal to entice and from 0:09:46.800 --> 0:09:50.320 college football Colorado now coach by Dilon Sanders left the 0:09:50.320 --> 0:09:53.080 Big Twelve, joined the Fact Twelve. Now going back to 0:09:53.120 --> 0:09:56.160 the Big Twelve. Lebron James and son Brownie out of 0:09:56.160 --> 0:09:59.120 the hospital in LA after suffering that probacter rest Johns 0:09:59.120 --> 0:10:01.440 stashedward bloom Sports. 0:10:03.040 --> 0:10:06.080 From coast to coast, from New York to San Francisco, 0:10:06.360 --> 0:10:11.040 Boston to Washington, DC, nationwide on Syrias exam the Bloomberg 0:10:11.080 --> 0:10:15.240 Business app in Bloomberg dot com. This is Bloomberg Daybreak. 0:10:16.400 --> 0:10:16.880 Good morning. 0:10:16.920 --> 0:10:20.280 I'm Nathan Hager. Every aspect of finance is affected by 0:10:20.280 --> 0:10:24.360 the artificial intelligence. Boom and Wall Street's main regulator is 0:10:24.440 --> 0:10:28.240 taking notice. The securities and Exchange Commission is proposing restrictions 0:10:28.240 --> 0:10:31.520 for brokerages and money managers that use AI to interact 0:10:31.520 --> 0:10:35.200 with clients. Chair Gary Gensler says it's about firms putting 0:10:35.200 --> 0:10:38.480 client interests ahead of their own. Gensler talked about that 0:10:38.679 --> 0:10:41.720 and his moves to further regulate the crypto industry in 0:10:41.760 --> 0:10:44.800 an interview with Bloomberg's Kaylee Lines and Danny Berger. Let's 0:10:44.800 --> 0:10:47.040 listen in to part of that conversation right now. 0:10:47.080 --> 0:10:49.920 I'd like to begin with your newest rules that you 0:10:50.040 --> 0:10:53.760 just unveiled yesterday, putting restrictions on brokerages and money managers 0:10:54.080 --> 0:10:56.520 and their use of AI to interact with clients. What 0:10:56.640 --> 0:11:00.000 is your primary concern with the adoption of this technology 0:11:00.280 --> 0:11:01.319 that you're trying to address? 0:11:01.440 --> 0:11:02.880 First, Kayley, it's good to be with you. 0:11:03.080 --> 0:11:08.040 But talking about this, I think that predictive data analytics, 0:11:08.040 --> 0:11:13.240 including artificial intelligence, is the transformative technology of our times, 0:11:13.240 --> 0:11:16.320 and every bit is transformatives to the Internet or mass 0:11:16.360 --> 0:11:18.480 production of the automobile one hundred years ago. 0:11:18.760 --> 0:11:20.520 Now, what are we trying to address? 0:11:21.240 --> 0:11:26.200 When an investment advisor or a broker works with you 0:11:26.280 --> 0:11:30.320 as an investor, they're not supposed to put their interest 0:11:30.520 --> 0:11:33.960 the advisor's interest ahead of yours, Kayley, as an investor. 0:11:34.679 --> 0:11:37.080 And so what we're trying to do is make sure 0:11:37.080 --> 0:11:42.199 that the technology aligns with that standard, that the technology 0:11:42.360 --> 0:11:45.360 that can predict about each and every one of us 0:11:45.400 --> 0:11:49.120 so much about how we might react to a little 0:11:49.160 --> 0:11:53.280 behavioral prompt or a little knowledge how we might react. 0:11:53.760 --> 0:11:57.680 That they're putting our interest as an investor in the 0:11:57.760 --> 0:12:00.600 right place and not putting themselves ahead of it. 0:12:01.160 --> 0:12:02.880 And of course the AI move wasn't the only one 0:12:02.920 --> 0:12:06.120 you made yesterday. You also just approved a plan to 0:12:06.160 --> 0:12:10.120 require companies to disclose cyber breaches within a four business 0:12:10.200 --> 0:12:11.120 day timeline. 0:12:11.160 --> 0:12:13.440 Why is that the appropriate time break. 0:12:13.400 --> 0:12:16.240 Well, if I could just give a little bit more, 0:12:16.320 --> 0:12:18.680 it's about material. 0:12:19.840 --> 0:12:20.440 Incidents. 0:12:20.960 --> 0:12:24.640 So if a company lost a factory and that factory 0:12:24.679 --> 0:12:29.360 is wiped out, and that factory is material to its operations, 0:12:29.559 --> 0:12:34.280 let's say, because it's lost to a hurricane, investors need 0:12:34.360 --> 0:12:36.880 to know when they're buying and selling the stock. In 0:12:36.920 --> 0:12:40.040 a similar way, if you had a cyber incident that 0:12:40.160 --> 0:12:43.760 management determines as material, you know, hundreds of millions of 0:12:43.760 --> 0:12:49.920 files lost or something or compromised, investors benefit from that disclosure. 0:12:50.200 --> 0:12:53.360 But giving business is just four days to disclose that. 0:12:53.360 --> 0:12:59.559 That's what we have in our rules today currently for 0:12:59.720 --> 0:13:04.840 businesusiness days if you have, like if that factory was 0:13:04.920 --> 0:13:10.239 wiped out by a hurricane, to put out the material information. 0:13:11.200 --> 0:13:14.600 And so that's consistent with rules on the books. And 0:13:14.640 --> 0:13:14.920 by the. 0:13:14.920 --> 0:13:18.880 Way, many companies have been making such disclosures, some haven't. 0:13:19.520 --> 0:13:22.319 It's been fragmented and we thought it was important to 0:13:22.360 --> 0:13:27.760 bring some consistency to it around these material events. 0:13:30.120 --> 0:13:32.480 Mister chaired Danny Berger here in London, really wonderful to 0:13:32.520 --> 0:13:34.840 speak with you today now now on some of your 0:13:34.880 --> 0:13:39.199 proposals when it comes to equity market structural reforms. You 0:13:39.280 --> 0:13:42.800 joined Bloomberg TV back in March. You said, of market participants, 0:13:43.280 --> 0:13:46.200 give us your best advice, tell us what you think. 0:13:46.640 --> 0:13:47.200 What did you get? 0:13:47.240 --> 0:13:50.000 What was the best advice you got? 0:13:50.640 --> 0:13:56.319 Well, we got in terms of equity market structure, thousands 0:13:56.640 --> 0:13:57.599 of comments. 0:13:57.600 --> 0:13:59.640 So I would say that. 0:13:59.760 --> 0:14:02.760 We're about at the SEC is trying to drive greater 0:14:03.320 --> 0:14:07.640 efficiency and competition in those markets. So when you send 0:14:07.679 --> 0:14:11.520 an order into a broker, that you feel that you're 0:14:11.559 --> 0:14:17.880 getting best execution in that order, and also that the 0:14:17.960 --> 0:14:20.040 markets themselves are competitive. 0:14:20.440 --> 0:14:23.360 So one of our rules was about sort of. 0:14:23.360 --> 0:14:28.400 Leveling the playing field between the lit markets, the so 0:14:28.440 --> 0:14:31.640 called New York Stock Exchange and NASDAK and so forth, 0:14:32.040 --> 0:14:36.200 and the wholesalers are dark market, which at times the 0:14:36.280 --> 0:14:39.200 dark part of the markets are between a third and 0:14:39.280 --> 0:14:41.400 a half of the market. So it's trying to bring 0:14:41.520 --> 0:14:46.640 some level the playing field and ensure that investors are 0:14:46.680 --> 0:14:48.880 getting best execution in these markets. 0:14:49.840 --> 0:14:52.800 What about in terms of the feedback you got, are 0:14:52.840 --> 0:14:55.000 you taking any of that on board? Would you change 0:14:55.040 --> 0:14:57.080 anything considering what you've heard so far? 0:14:58.520 --> 0:15:01.960 Well, we do that as a regular basis. 0:15:01.960 --> 0:15:03.960 When we make a proposal, we put it out to 0:15:03.960 --> 0:15:07.440 public comment and get feedback, and we put out four 0:15:07.640 --> 0:15:13.360 separate proposals for different aspects in the markets, and I 0:15:13.360 --> 0:15:16.880 think we've gotten four to six thousand comments on each 0:15:16.920 --> 0:15:17.240 of them. 0:15:17.320 --> 0:15:22.000 So and we naturally consider. 0:15:21.600 --> 0:15:25.080 It and the staff makes recommendations about adjustments. 0:15:25.800 --> 0:15:28.960 Okay, I'd like to discuss another proposed rulemaking that has 0:15:28.960 --> 0:15:29.880 received a certain. 0:15:29.640 --> 0:15:31.480 Degree of feedback, your climate risk. 0:15:31.320 --> 0:15:35.480 Disclosures, specifically as it relates to Scope three emissions. What 0:15:35.520 --> 0:15:38.640 conversations are you having around Scope three in particular. 0:15:39.040 --> 0:15:41.920 Well, we've heard a lot from the public on this, 0:15:42.040 --> 0:15:46.440 but to set the stage companies today are making disclosures 0:15:46.480 --> 0:15:49.400 around climate risk. In fact, well over half of the 0:15:49.440 --> 0:15:54.360 top thousand or so companies currently make climate risk disclosures, 0:15:54.400 --> 0:15:59.680 including greenhouse gas emission disclosure. So we're trying to bring 0:16:00.000 --> 0:16:03.320 consistency to that and yes for investors that they can 0:16:03.400 --> 0:16:07.800 compare comparability for that. You asked about one part of 0:16:07.920 --> 0:16:11.400 greenhouse gas missions, so called Scope three, which is about 0:16:11.400 --> 0:16:12.440 the supply. 0:16:12.200 --> 0:16:15.080 Chain and where a lot of the concern lines. 0:16:14.800 --> 0:16:19.880 And so we've heard from a lot of commenters about that, 0:16:19.960 --> 0:16:24.560 both from issuers and investors. We understood when we made 0:16:24.560 --> 0:16:28.600 a proposal that this was not as well developed so 0:16:28.680 --> 0:16:34.000 called disclosures around supply chain emissions, and so we're taking 0:16:34.000 --> 0:16:38.440 that into consideration. And as I just chatted with your colleague, 0:16:38.680 --> 0:16:44.600 the staff considers what to recommend upon adoption and whether 0:16:44.680 --> 0:16:45.720 to make adjustments, so. 0:16:45.680 --> 0:16:47.400 We could see you change there potentially. 0:16:47.480 --> 0:16:50.040 Well, just as in the equity markets that I talked about, 0:16:50.080 --> 0:16:55.120 we do take these comments seriously, Kayley. It's a really 0:16:55.760 --> 0:17:00.400 rigorous exercise in climate. We got sixteen thousand comments, so 0:17:00.440 --> 0:17:01.240 it's a lot. 0:17:01.040 --> 0:17:03.480 To sort of sort through. But the Scope III issue 0:17:03.520 --> 0:17:05.359 is one that we've heard. 0:17:06.600 --> 0:17:10.480 Significant comments Interestingly, we've heard from I think forty eight 0:17:10.600 --> 0:17:14.840 or forty nine of the state farm bureaus literally about 0:17:14.880 --> 0:17:17.080 well what is this effect? 0:17:17.600 --> 0:17:18.879 And we only. 0:17:18.640 --> 0:17:25.080 Oversee the public companies, these six or seven thousand public companies. 0:17:25.480 --> 0:17:26.760 That's it. 0:17:26.920 --> 0:17:31.160 We are a disclosure based agency. I often say we're 0:17:31.240 --> 0:17:32.040 merit neutral. 0:17:32.080 --> 0:17:33.760 We are not. You know, we're not. 0:17:35.040 --> 0:17:41.000 This disclosure is about something already happening between investors and issuers, 0:17:41.040 --> 0:17:45.199 and it's an important thing to bring consistency. It's not 0:17:45.359 --> 0:17:50.000 about those, you know, those farmers and ranchers who thoughtfully 0:17:50.000 --> 0:17:50.480 wrote us. 0:17:51.040 --> 0:17:51.720 So we've heard. 0:17:52.160 --> 0:17:54.440 Okay, I'd like to move to a different topic which 0:17:54.640 --> 0:17:58.199 has gotten a lot of attention lately, Crypto, specifically a 0:17:58.280 --> 0:17:59.919 ruling that was made in the Ripple case that x 0:18:00.119 --> 0:18:04.240 R is only a security when sold to institutional investors, 0:18:04.320 --> 0:18:08.240 not so with retail investors. I know you've previously said 0:18:08.280 --> 0:18:10.840 you were disappointed by that ruling. The SEC has also 0:18:10.920 --> 0:18:14.520 said that it intends to seek further review. So does 0:18:14.520 --> 0:18:16.359 that mean you are going to appeal it? Can you 0:18:16.400 --> 0:18:18.399 elaborate on your thoughts around that ruling? 0:18:18.920 --> 0:18:24.160 Kaylee? Great question, But the Commission, I'm one of five commissioners. 0:18:24.480 --> 0:18:25.560 The Commission has not. 0:18:27.000 --> 0:18:33.400 Acted on that, and if the staff makes a recommendation, 0:18:33.960 --> 0:18:36.480 we'll have a discussion of it and we'll take it 0:18:36.560 --> 0:18:36.840 up then. 0:18:36.920 --> 0:18:39.119 But I don't really have anything more on you for 0:18:39.320 --> 0:18:39.720 you for that. 0:18:40.840 --> 0:18:43.960 In the meantime, as we wait for this, what does 0:18:44.000 --> 0:18:47.560 it mean for your efforts around crypto, for your efforts 0:18:47.640 --> 0:18:50.240 to try to protect the consumer in these areas? Does 0:18:50.280 --> 0:18:51.199 it complicate it? 0:18:53.280 --> 0:19:02.120 Look this field of crypto investing, a lot of investors 0:19:03.280 --> 0:19:08.240 should be aware. It's not only a highly speculative asset class, 0:19:08.800 --> 0:19:14.000 it's also one that they currently should not assume that 0:19:14.040 --> 0:19:18.360 they're getting the protections of the securities laws, even though 0:19:18.400 --> 0:19:21.879 the securities laws apply to many of those tokens without 0:19:21.880 --> 0:19:27.200 prejudging anyone, but you as investors are not getting. 0:19:27.359 --> 0:19:29.560 The full, fair and truthful disclosure. 0:19:30.880 --> 0:19:34.919 And the platforms, the intermediaries are doing things that we 0:19:34.960 --> 0:19:39.199 would never in a day allow or think the New 0:19:39.280 --> 0:19:44.040 York Stock Exchange or NASDAQ would do. The platforms often 0:19:44.480 --> 0:19:47.800 are co mingling and trading against you and have market 0:19:47.840 --> 0:19:51.920 makers that are on the other side of your trades, 0:19:52.160 --> 0:19:54.520 and we don't allow that in the rest of our 0:19:54.560 --> 0:20:00.360 securities markets and the securities laws are there to protect you. 0:20:00.760 --> 0:20:02.160 And that's right now. 0:20:03.280 --> 0:20:08.439 This is a field rife with fraud, rife with hucksters, 0:20:08.480 --> 0:20:11.040 and they're good faith actors as well, but there are 0:20:11.320 --> 0:20:13.200 far too many that aren't. 0:20:13.560 --> 0:20:17.440 And of course you've brought cases against crypto exchanges on 0:20:17.480 --> 0:20:20.600 this point. But do you need to change tactic? Does 0:20:20.640 --> 0:20:24.119 it change anything for those cases? Again this XRP ruling. 0:20:25.560 --> 0:20:29.640 Again, I'm not going to go into any one ruling, 0:20:30.240 --> 0:20:33.080 but I think that the securities laws are clear, and 0:20:33.160 --> 0:20:38.560 if you're if the public is investing in your project 0:20:38.600 --> 0:20:44.440 because they're anticipating profits based upon the efforts of that project, 0:20:44.520 --> 0:20:49.800 or there's entrepreneurs Congress painted with a broad brush, and 0:20:50.920 --> 0:20:52.960 I would ask you this, It's like when you look 0:20:53.000 --> 0:20:55.520 at a token, you can find a website, you can 0:20:55.560 --> 0:20:59.240 find a CEO, you can find a Twitter or x feed, 0:20:59.320 --> 0:21:04.959 whatever it's called these days, and there are entrepreneurs behind 0:21:05.080 --> 0:21:08.960 many of these projects. Without again prejudging any one of them. 0:21:09.440 --> 0:21:11.560 Elsewhere in the crypto space, I'd like to discuss the 0:21:11.640 --> 0:21:15.120 spot ETF because we have seen a wave of filings 0:21:15.160 --> 0:21:18.919 recently recently from Blackrock and others trying to finally achieve 0:21:18.960 --> 0:21:21.159 this one has never been approved in the US, just 0:21:21.200 --> 0:21:24.440 a futures etf it seems like everyone thinks there has 0:21:24.480 --> 0:21:27.720 been a tone shift, that something is different this time around. 0:21:27.800 --> 0:21:30.040 What do you make of that wave of recent filings? 0:21:30.040 --> 0:21:31.560 Has anything actually changed for the. 0:21:31.480 --> 0:21:35.920 Sec Kayleye, Probably won't surprise you. Those filings do ultimately 0:21:35.920 --> 0:21:37.960 come up to a five member commission, so I can't 0:21:38.000 --> 0:21:42.520 prejudge any filing. But back to your colleague, as I said, 0:21:42.560 --> 0:21:49.200 this is a field that there's a lot of non 0:21:49.400 --> 0:21:56.040 compliance in this field, and that the platforms themselves where 0:21:56.080 --> 0:22:02.600 trading is occurring of various crypto tokens. Though some of 0:22:02.640 --> 0:22:08.080 it comes under the securities laws, currently they're not necessarily 0:22:08.080 --> 0:22:12.080 compliant with those time test of protections against fraud and manipulation. 0:22:12.640 --> 0:22:15.280 Okay, on the subject of securities laws, which obviously is 0:22:15.320 --> 0:22:19.280 your purview at the SEC. Just yesterday House Financial Services 0:22:19.280 --> 0:22:22.800 Committee passed through committee legislation on crypto market structure that 0:22:22.800 --> 0:22:25.920 would actually give more authority in regulating this space to 0:22:25.960 --> 0:22:28.360