Speaker 1: Bloomberg Audio Studios, podcasts, radio news. This is Balance of
Speaker 1: Power live from Washington, DC.
Speaker 2: Uswetter says Iran will never have a nuglio WEP, and
Speaker 2: that's where it says it won't have one Dubai to develop.
Speaker 2: They will not have a nuclear WEP. And I would
Speaker 2: say that's about ninety nine point nine percent of what
Speaker 2: I wanted because we couldn't let that happen. You couldn't
Speaker 2: let that happen. And they won't have a new glue WEP.
Speaker 2: And now in addition to that, the straight is going
Speaker 2: to be open toll free Tonight.
Speaker 3: Details details.
Speaker 4: President Trump touting his agreement with Iran on day two
Speaker 4: of the g seventh Summit, but questions remain over what's
Speaker 4: actually in the memorandum of understanding and.
Speaker 3: What still needs to be to go.
Speaker 5: It is.
Speaker 3: Also let's make a deal.
Speaker 4: After months of back and forth over competing housing bills,
Speaker 4: congressional leaders say they have an agreement on a bicameral package.
Speaker 4: We will speak with one of its sponsors, Senator Elizabeth
Speaker 4: Warren coming up this hour. We'll cover it all in
Speaker 4: the View from the Hill. Senators Warren as well as
Speaker 4: Ron Johnson, joined Balance of Power on the IURON agreement,
Speaker 4: the housing fight. Kevin Wirsh has fed and a lot
Speaker 4: more from Bloomberg's Washington, DC studios to our TV and
Speaker 4: radio audiences worldwide. Welcome to Balance of Power alongside Kaylee Lines,
Speaker 4: I'm Joe, Matthew and Joe.
Speaker 6: We begin with new developments tonight from the G seven
Speaker 6: summit in France. As the US and Iran prepared to
Speaker 6: formally sign an interim peacedale this Friday, the rest of
Speaker 6: the world is pressing for details on what's actually in it.
Speaker 6: The framework agreement has yet to be published, but a
Speaker 6: near final draft seen by Bloomberg News indicates a Ron
Speaker 6: is set to receive some key financial incentives, including sanctions
Speaker 6: waivers to begin selling oil immediately.
Speaker 7: For the very latest, Let's go.
Speaker 6: Live now to Bloomberg's Tyler Kendall, who was covering the
Speaker 6: summit for US from Evian France.
Speaker 5: Tyler Hey, Caylee Well New tonight, as you mentioned, Bloomberg
Speaker 5: News has obtained the latest draft agreement of this memorandum
Speaker 5: of understanding, which appears to show that Iran will get
Speaker 5: broad financial incentives, at least for now, as the US
Speaker 5: does maintain that those incentives will only accrue if Iran
Speaker 5: maintains its end of the deal. But importantly, there's a
Speaker 5: few different threads that we've been following here, including that
Speaker 5: this does include that Iran would be able to tap
Speaker 5: a three hundred billion dollar development fund, which the MoU
Speaker 5: says will be financed through the US as.
Speaker 7: Well as regional partners.
Speaker 5: As you mentioned, we have been waiting for any signal
Speaker 5: when it comes to whether or not Iran will be
Speaker 5: able to sell its crude to market, and this draft
Speaker 5: MoU goes on to say that the US Treasury Department will,
Speaker 5: in part quote issue waivers for exports of Iranian crude oil,
Speaker 5: petrochemical products, and their derivatives, apparently immediately after this deal
Speaker 5: is signed. Again, though it is our understanding that only
Speaker 5: sustained progress when it comes to maintaining to the deal
Speaker 5: will mean that those financial benefits will keep accruing.
Speaker 7: We should say that our own reporting.
Speaker 5: Does caution that both sides have indicated that they are
Speaker 5: still in these technical discussions, which means that ultimately the
Speaker 5: final draft language could change. But President Trump himself did
Speaker 5: indicate and confirm that we are expecting this signing ceremony
Speaker 5: to take place this Friday in Switzerland. Vice President Jade
Speaker 5: Vance is expected to represent the US side, and Joe
Speaker 5: and Keihley. We're expecting Aron's parliament speaker to be there
Speaker 5: to sign on behalf of the of their country.
Speaker 3: It would be quite a moment, Tyler. You're of course
Speaker 3: surrounded by stakeholders.
Speaker 4: What kind of optimism or concerns are you hearing specifically
Speaker 4: from European leaders about the nuances to the extent that
Speaker 4: we understand of this deal and the reopening of the Straight.
Speaker 5: Well, Joe, at this point, we know that the first
Speaker 5: phase of this agreement is going to be to get
Speaker 5: the Strait of her Moves reopen. Yes, we're going to
Speaker 5: see the sixty day extension of the ceasefire, but the
Speaker 5: Strait needs to be reopened and the US will be
Speaker 5: lifting its naval blockade. But there are both short and
Speaker 5: long term concerns here when I'm talking to people on
Speaker 5: the ground here at the G seven summit. In the
Speaker 5: immediate term, we know that the US is looking for
Speaker 5: allies to help ultimately deploy assets to reopen and.
Speaker 7: Secure that waterway.
Speaker 5: But I spoke earlier today with the spokesperson for France's
Speaker 5: Foreign Ministry that said that they need to get these
Speaker 5: concrete deals, details in the deal in front of them.
Speaker 7: They need to see that.
Speaker 5: Agreement ultimately signed in assurances that their own military assets
Speaker 5: wouldn't be put at risk, considering that we know that
Speaker 5: the Strait is still mined. And then of course Joe
Speaker 5: and Kayley, there are concerns here that even as Iran
Speaker 5: says that in this first sixty days there will not
Speaker 5: be tolls, there are serious concerns that Aron is looking
Speaker 5: to impose fees once those sixty days are over, but
Speaker 5: they are trying to reframe them as being tied for
Speaker 5: navigational or in turing services.
Speaker 4: Well, fascinating, Tyler, thank you so much traveling with the
Speaker 4: President Bloomberg. Tyler Kendall in Evon, France, joining us now
Speaker 4: on this and a lot more. As Democratic Senator Elizabeth
Speaker 4: Warren of Massachusetts's ranking member on the Senate Banking Committee,
Speaker 4: of course sits as well on the Senate Armed Services Committee. Senator,
Speaker 4: welcome back to Bloomberg's TV and radio. I'd like to
Speaker 4: start with Ron if we can. Kaylee and I have
Speaker 4: a lot of questions for you. As always, I'm just
Speaker 4: wondering if you have seen any details of this agreement
Speaker 4: beyond what we're already reporting in the media, And is
Speaker 4: there a likelihood that the president is correct, that he
Speaker 4: can in fact craft a better deal in the next
Speaker 4: sixty days. In the JCPOA, you.
Speaker 8: Know, the President's made a lot of promises. How many
Speaker 8: times has he told us this war is over and
Speaker 8: how many times have we come back again to see
Speaker 8: it all fall apart. No, we have not seen the details,
Speaker 8: and of course the devil is in the details. But
Speaker 8: here's the part we know for sure. We know that
Speaker 8: just before Donald Trump started bombing in Iran, that the
Speaker 8: Straight of Horror Moods was open and nobody was collecting
Speaker 8: any fees or tolls to be able to travel it.
Speaker 8: We know that Iran's three hundred billion dollars that was
Speaker 8: located all around the world was locked up tight and
Speaker 8: Iran couldn't use it. And we know that there were
Speaker 8: heavy sanctions in place on the sale of Iranian oil.
Speaker 8: And we know that those things together were really putting
Speaker 8: a real vice on the country and that the economy
Speaker 8: was in real trouble and it was causing people to
Speaker 8: push back. Donald Trump then started bombing, claiming that his
Speaker 8: intention was to have regime change. Obviously that hasn't happened.
Speaker 8: We don't know what's going to happen to the money
Speaker 8: put all around the world, but it sounds like Iran
Speaker 8: is going to come out of this with war money
Speaker 8: with they claim an opportunity to get fees through the
Speaker 8: strait of horror moos, which Donald Trump somehow says is
Speaker 8: not the same as tolls. And so there we are.
Speaker 8: America has spent literally tens of billions of dollars halfway
Speaker 8: around the world. Fourteen American service members have died, uncounted
Speaker 8: numbers of people in the Middle East have died, and
Speaker 8: Donald Trump still can't explain how one family in America
Speaker 8: is any better off well.
Speaker 6: Senator President Trump did say today that while he hadn't
Speaker 6: previously thought about it, he would like to see a
Speaker 6: final deal go before Congress. Would you be prepared to
Speaker 6: cast a vote for a deal that does bring an
Speaker 6: end to this war in the Middle East that you
Speaker 6: clearly thought we never should have gotten in, meshed in
Speaker 6: meshed with in the first.
Speaker 8: Place, that we never should have gotten involved in, and
Speaker 8: that so far Republicans have voted consistently to let Donald
Speaker 8: Trump continue for as long as he wants. Like anything,
Speaker 8: it depends on what the details are here. Remember Congress
Speaker 8: voted back in twenty fifteen for a deal to keep
Speaker 8: it Run from developing a nuclear weapon, and then Donald Trump,
Speaker 8: all on his own, came in and tore that apart.
Speaker 8: And there's one more piece. How is it that we
Speaker 8: are somehow better off after Donald Trump has spent billions
Speaker 8: of dollars killed American service members, bombed a foreign country
Speaker 8: or multiple foreign countries. Where where are we any better off?
Speaker 8: That's what Donald Trump cannot explain to the American people.
Speaker 8: But I'll tell you this, the folks I'm hearing from
Speaker 8: back home. We'll tell you where we're worse off. Where
Speaker 8: the price of gasoline is through the roof. I hear
Speaker 8: from the farmers who say they can't afford to buy
Speaker 8: the fertilizer they need. I hear from truckers who say
Speaker 8: they can't afford to get out on the roads that
Speaker 8: are having to pass those costs along to everything that
Speaker 8: gets shipped in America. I see it in the rising
Speaker 8: interest rates. Now, So I get how Donald Trump has
Speaker 8: made this country a lot worse off by bombing in
Speaker 8: I run, but boy, he can point of where we're
Speaker 8: better off.
Speaker 4: Well, you know you're hearing from Pete Hagseth as well
Speaker 4: as Senator about money, and of course he's there to
Speaker 4: make the case. And what was today in Congress for
Speaker 4: a massive budget request for the Pentagon?
Speaker 3: Senator Cornyn says the Secretary.
Speaker 4: Told him the Pentagon needs three hundred and fifty billion
Speaker 4: dollars immediately and then a one and a half trillion
Speaker 4: dollar budget for the Pentagon on an annual level. Is
Speaker 4: this money that the Pentagon needs now to replenish munitions?
Speaker 3: And will they get it?
Speaker 7: So?
Speaker 8: Exactly? How does he describe need? The Pentagon has not
Speaker 8: passed an audit. Secretary of heg Seth comes out here,
Speaker 8: throws around a couple of numbers, but will not even
Speaker 8: give us the receipts for how much the war in
Speaker 8: Iran has cost. The numbers that they've put forward, you
Speaker 8: can just look at public records until they're not right.
Speaker 8: So he wants to come in here. He doesn't want
Speaker 8: to give us an honest accounting.
Speaker 3: He does.
Speaker 8: I want to show us how he plans to spend
Speaker 8: the money and what it's for, and he wants over
Speaker 8: a trillion and a half dollars and more. I don't think.
Speaker 7: So, Senator.
Speaker 6: I'd like to ask you about another issue that is
Speaker 6: now live in your chamber ahead of Jake Clayton's nomination
Speaker 6: hearing tomorrow to be Director of National Intelligence. Are you
Speaker 6: willing three unanimous content to expedite his confirmation process in
Speaker 6: the name of getting FIZA Section seven oh two powers reauthorized.
Speaker 8: So, actually, I think there's some things you need to
Speaker 8: separate in that question. The question of going forward expeditiously
Speaker 8: on Jake Clayton is a question about making sure that
Speaker 8: mister Paulton never sets foot inside the DNS building and
Speaker 8: never gets a look at all of our national security secrets.
Speaker 8: And I think that is a worthy goal. Now understand this.
Speaker 8: I'm not voting for Jay Clayton, and the reason I'm
Speaker 8: not is I both worked with him on banking and
Speaker 8: saw his views about deregulation generally and the role of government.
Speaker 8: But I am particularly alarmed about what he has done
Speaker 8: in terms of election denihialism and conspiracy theories. We don't
Speaker 8: need somebody like that who can look into every part
Speaker 8: of America's secrets best domestic and internationally. I don't know
Speaker 8: what it is that now guides him. He is certainly
Speaker 8: not just the Wall Street person. He now seems to
Speaker 8: have a very different view when he's talking about national security.
Speaker 8: And remember, he's someone who has zero experience in intelligence
Speaker 8: and national security, and the statute itself requires that the
Speaker 8: person in that role have that experience. So there's the
Speaker 8: question about expediting so that Poulty stays out of the building.
Speaker 8: There's this separate question about confirming Jake Clayton, and then
Speaker 8: there's the third question about FIZA, and that one is
Speaker 8: a separate one. Yet as it stands right now, I
Speaker 8: do not support the bill you mentioned.
Speaker 4: Kevin Worsh at the beginning of our conversation got his
Speaker 4: first FED meeting as chair tomorrow. Senator, you of course
Speaker 4: put a lot of weight on financial disclosures in his
Speaker 4: confirmation hearing as he prepares to meet the President, looks
Speaker 4: like he is widely expected to not cut rates as
Speaker 4: the President has urged.
Speaker 3: Did you get the information that you need?
Speaker 4: Are you comfortable with Kevin Worsh as the share of
Speaker 4: the FED?
Speaker 8: No, I am not comfortable, and I'm not comfortable because
Speaker 8: we have never gotten enough disclosure to know for certain
Speaker 8: that there are not conflicts of interest. I am not
Speaker 8: comfortable with anyone who is not straight up and honest
Speaker 8: and transparent with the American people.
Speaker 3: I still think he's a sock puppet. If he doesn't
Speaker 3: cut rates tomorrow, well.
Speaker 8: We will say, look right now, Donald Trump has actually
Speaker 8: put Kevin Warsh in a pretty terrible box, and that
Speaker 8: is that Trump's policies on tariffs, on energy, on healthcare,
Speaker 8: and on wars around the world mean that prices are
Speaker 8: shooting through the roof for American families. And as you know,
Speaker 8: inflation is at its highest rate in about three and
Speaker 8: a half years, and we see what's coming down the line.
Speaker 8: Looks like prices may be going up even faster. And
Speaker 8: that means that the place ordinarily the FED would go
Speaker 8: with its tool is to raise interest rate, but that
Speaker 8: increases costs for American families. And American families don't need
Speaker 8: to pay more on their credit cards, on mortgages and
Speaker 8: on car loans. They're already slammed against the wall trying
Speaker 8: to pay for groceries and for health care and for housing.
Speaker 8: So Donald Trump's policies outside the Fed monetary policy are
Speaker 8: really creating havoc in this economy. And what the Fed
Speaker 8: can do about it is pretty limited.
Speaker 6: Well, Senator, you raise housing, and I know you're about
Speaker 6: to go to the floor yourself to advance a housing
Speaker 6: bill that now apparently has buy.
Speaker 7: Camerale buy it.
Speaker 6: We have seen a lot of volleying back and forth
Speaker 6: between your Chamber and the House of Representatives. What is
Speaker 6: it that unlocked this deal now? And when do you
Speaker 6: expect it can be on President Trump's desk for signature.
Speaker 3: Oh?
Speaker 8: So, look, as you know, we are in a housing
Speaker 8: crisis all over this country. We need more housing, and
Speaker 8: this bill has about forty five provisions in it, each
Speaker 8: one of which moves us toward an increase in total
Speaker 8: housing supply. Plus, this is the first bill ever in
Speaker 8: American history to put some constraints on private equity and
Speaker 8: say that they can't come into your neighborhood buy up
Speaker 8: every house on the block and try to turn America
Speaker 8: into a nation of renters instead of owners. So it's
Speaker 8: a pretty historic bill. We've got great buy artisan buy in,
Speaker 8: and we've got the house in the right place on
Speaker 8: it now too. So I think we're going to get
Speaker 8: this done and get it over to the President's desk.
Speaker 4: I'd like to ask you about SpaceX before you leave us, Senator,
Speaker 4: you fought to delay the IPO, which was the biggest
Speaker 4: in the world, and the stock continues to rise since
Speaker 4: the debut.
Speaker 3: I wonder if, since it.
Speaker 4: Is obviously now part of the market, if you plan
Speaker 4: to follow up as ranking member, will there be an
Speaker 4: investigation and any of the exemptions that were made, specifically
Speaker 4: the seasoning exemption at the NASDAQ?
Speaker 3: What's next for you in this saga?
Speaker 8: So look, let me just remind you what my concerns are.
Speaker 8: The first one was with the IPO. It is the
Speaker 8: job of the SEC to check the homework to make
Speaker 8: sure that the financials make sense. And remember the financial
Speaker 8: experts out there a lot of we're calling the numbers
Speaker 8: that Elon must put forward nonsensical. Those were the words
Speaker 8: from the experts. The SEC clearly did not play its
Speaker 8: watchdog function that it is required to play. Then the
Speaker 8: index providers turned around change their rules. And remember these
Speaker 8: index providers, there's usually a delay from an IPO so
Speaker 8: that a need frauth can die down and before the
Speaker 8: index starts buying in, we know we're kind of at
Speaker 8: the right price on this stock. The index providers haven't
Speaker 8: done that and that means for just ordinary four oh
Speaker 8: one k investors, people who just want a calm retirement
Speaker 8: and just a little piece of whatever's going on in
Speaker 8: the market, they're forced to take on AI, even if
Speaker 8: they see to take on SpaceX, even if they see
Speaker 8: this as a giant bubble or a lot of fraud,
Speaker 8: or even fraud, because of the way the index providers
Speaker 8: have done this. And then the third concern I have
Speaker 8: is that in the IPO, Elon Musk has pulled back
Speaker 8: on shareholder protections so that in effect he has locked
Speaker 8: himself in as king for life in SpaceX. And my
Speaker 8: concern on every one of these is partly about SpaceX,
Speaker 8: but it's partly about our markets. Generally, our market is
Speaker 8: the envy of the world, and the reason for that
Speaker 8: is for years now, nearly a century, we've had a
Speaker 8: tough watchdog who make sure that everybody's numbers add up.
Speaker 8: You can make your own decision about where you think
Speaker 8: this company is going, but that what they're telling you
Speaker 8: is pretty straight up. And if we start to lose
Speaker 8: that in a case like this, and lose it for
Speaker 8: the future, then that chills investors all over the United States,
Speaker 8: puts them at risk and makes people around the world say,
Speaker 8: you know, that may not be the safest market to
Speaker 8: go to. Maybe I ought a trade somewhere else where.
Speaker 8: The watch dog is still awake.