WEBVTT - Gene Sperling: Democrats Must Stick Together To Go Big 0:00:01.400 --> 0:00:04.120 Welcome to the Bloomberg Markets Podcast. I'm Paul Sweeney. Along 0:00:04.120 --> 0:00:06.240 with my co host of Bonnie Quinn. Every business day 0:00:06.240 --> 0:00:10.400 we bring you interviews from CEOs, market pros, and Bloomberg experts, 0:00:10.440 --> 0:00:13.600 along with essential market moving news. Find the Bloomberg Markets 0:00:13.600 --> 0:00:17.000 Podcast on Apple Podcasts or wherever you listen to podcasts, 0:00:17.000 --> 0:00:20.560 and on Bloomberg dot com. As well. As President elected 0:00:20.640 --> 0:00:23.319 by then prepares to take the office, much of the 0:00:23.320 --> 0:00:26.960 focus will be on his economic plan. Taking a preview 0:00:27.000 --> 0:00:29.280 what we might see, we welcome Gene Sperling. He's a 0:00:29.320 --> 0:00:33.159 former director of the National Economic Council under president's Clinton 0:00:33.240 --> 0:00:37.400 and Obama. He is now president of Sparling Economic Strategies 0:00:37.400 --> 0:00:40.000 based in Santa Monica, California. Gene, thanks so much for 0:00:40.080 --> 0:00:42.960 joining us here. A lot to unpack here as it 0:00:43.000 --> 0:00:46.360 relates to the President elect and his first one days, 0:00:46.400 --> 0:00:49.600 maybe even first ten days, maybe even today in terms 0:00:49.680 --> 0:00:53.159 of his actions from an economic perspective. What do you 0:00:53.280 --> 0:00:59.160 think he and his administration need to get done quickly? Well, 0:00:59.200 --> 0:01:02.440 I think they've made it smart decision in that they 0:01:02.440 --> 0:01:07.160 are bifurcating their uh call it a hundred day plan 0:01:07.600 --> 0:01:12.360 or uh economics start, which is to first focus on 0:01:13.000 --> 0:01:16.800 the economic relief needed for the crisis. So that means 0:01:16.840 --> 0:01:21.360 both getting huge amounts up to four hundred billion dollars 0:01:21.400 --> 0:01:24.280 to ensure that we are able as a country to 0:01:24.440 --> 0:01:28.840 truly deal with the COVID crisis, and that includes the 0:01:28.959 --> 0:01:33.600 vaccine distribution, all of the testing, all of the things 0:01:33.640 --> 0:01:38.399 that we've been so weak and weaker than other nations in. 0:01:38.640 --> 0:01:42.560 And then also the funding that would go to UH 0:01:42.760 --> 0:01:44.840 people who are hurting, people who are at risk of 0:01:44.920 --> 0:01:50.320 losing being evicted. Obviously, you know, more general support, but 0:01:50.400 --> 0:01:53.080 really for people who need it in the taking the 0:01:53.160 --> 0:01:56.200 checks up to two thousands. But they're saying, let's do 0:01:56.240 --> 0:02:00.000 that first. Let's do that relief package first, let's get 0:02:00.160 --> 0:02:05.200 that done. Let's not hold up UH that for more complex, 0:02:05.280 --> 0:02:08.919 longer term issues. So you'll see them move quickly, and 0:02:09.320 --> 0:02:11.640 they're going to try to make it bipartisan. They're going 0:02:11.680 --> 0:02:14.760 to try to do what's called regular order, working with 0:02:15.120 --> 0:02:18.600 Republicans do something with sixty votes. But they know and 0:02:18.880 --> 0:02:21.640 that they in their back pocket they have the ability 0:02:22.000 --> 0:02:25.760 through a process called reconciliation, to pass this with just 0:02:26.000 --> 0:02:29.839 fifty Democratic votes. That won't be their goal, but that's 0:02:29.880 --> 0:02:33.760 a backup plan to make sure they get this part 0:02:33.880 --> 0:02:37.720 done fast while people are hurting. Economy needs that. Then 0:02:37.760 --> 0:02:40.799 they say, let's come back and do the build better 0:02:40.880 --> 0:02:47.160 jobs plan, the infrastructure, the green uh climate jobs, the manufacturing, 0:02:47.280 --> 0:02:52.240 the enhancing care caregiving jobs across the country. They know 0:02:52.400 --> 0:02:54.760 that's going to take longer, it's gonna be a little 0:02:54.800 --> 0:02:59.200 more complex. Uh. So they're saying that's our that's that's 0:02:59.200 --> 0:03:02.240 phase two. And I think that both are important. One 0:03:02.320 --> 0:03:05.520 is about relief and emergency, the others about more long 0:03:05.600 --> 0:03:09.160 term recovery, about speeding the speed in which we get 0:03:09.200 --> 0:03:12.799 back to long term Uh, I mean we get back 0:03:12.840 --> 0:03:16.760 to full employment. Remember, uh we're still down nine and 0:03:16.760 --> 0:03:20.800 a half million jobs since the start of COVID, So 0:03:21.320 --> 0:03:24.520 we're still in a deep hole with a lot of 0:03:24.639 --> 0:03:28.680 risk still out there for this recovery. And at this 0:03:28.760 --> 0:03:31.800 point we have former President George W. Bush and his 0:03:31.919 --> 0:03:34.920 wife Laura arriving on the platform. Do you know I 0:03:34.920 --> 0:03:39.080 want to ask you who will Joe Biden and team 0:03:39.280 --> 0:03:41.680 be targeting in terms of trying to get some of 0:03:42.360 --> 0:03:44.640 you know, what they want done. I mean, for example, 0:03:44.680 --> 0:03:47.520 at one point nine trillion dollars stimulus, there's very few 0:03:47.520 --> 0:03:49.920 people who actually believe that it will be the full 0:03:50.000 --> 0:03:52.600 one point nine trillion dollars. But to get up as 0:03:52.680 --> 0:03:54.960 much as possible, who are the power brokers they need 0:03:55.000 --> 0:04:00.160 to to be to be targeting well, I think the 0:04:00.600 --> 0:04:04.000 I think in the end of the day, the most 0:04:04.040 --> 0:04:08.080 important thing is can they keep all of the Democrats together, 0:04:08.160 --> 0:04:12.040 because again, if they have fifty votes they get to 0:04:12.160 --> 0:04:15.320 use for a budget matters which are kind of the 0:04:15.720 --> 0:04:19.800 major kind of spending issues. You can do it with reconciliation. 0:04:20.080 --> 0:04:22.920 So it would be the Democrats that might be holdouts. 0:04:23.800 --> 0:04:26.360 I think, you know, you'd want to make sure that 0:04:26.400 --> 0:04:29.000 the that the ones who are seen as the more 0:04:29.560 --> 0:04:32.640 moderate Democrats. You know, I think people will be looking 0:04:32.680 --> 0:04:37.760 a lot at Joe Mansion from West Virginia, UH, Senator 0:04:37.839 --> 0:04:42.360 Cinema from Arizona Center, Tester from Montana. They're gonna want 0:04:42.400 --> 0:04:46.279 to say, where can what in this package can we 0:04:46.400 --> 0:04:51.400 get agreement on? That goes all the way from the 0:04:51.440 --> 0:04:55.919 most progressive members like Bernie Sanders to the more conservative 0:04:55.960 --> 0:04:59.279 members of the Democratic Party like Joe Manson. But I 0:04:59.320 --> 0:05:01.880 think when they start, they're going to start with the 0:05:02.000 --> 0:05:04.760 view that a lot of Republicans are not are going 0:05:04.800 --> 0:05:08.320 to want to support the major money for vaccine distribution. 0:05:08.680 --> 0:05:13.479 You've had several Republicans support the taking the checks to 0:05:13.560 --> 0:05:16.520 two thousand dollars. It's gonna be hard for lots of 0:05:16.560 --> 0:05:20.120 people to vote against extending long term unemployment. So I 0:05:20.160 --> 0:05:23.359 think they're going to start with a fairly broad view, 0:05:23.720 --> 0:05:28.640 looking for where the Republicans, uh, you know, can support them. 0:05:29.480 --> 0:05:34.120 The biding can show he's doing bipartisan economic legislation, but 0:05:34.200 --> 0:05:37.359 in the end of the day, they know that ultimate 0:05:37.560 --> 0:05:42.160 backup card is having all fifty Democrats on board, and 0:05:42.200 --> 0:05:45.279 so yes, I think they'll be looking for where their 0:05:45.360 --> 0:05:51.040 most progressive and most moderate members can find common ground. So, Gene, 0:05:51.480 --> 0:05:55.560 it's fairly clear that this pandemic and the economic disruption 0:05:55.640 --> 0:06:00.520 has just exposed yet again, income, inequality, wealth, any quality 0:06:00.720 --> 0:06:03.880 in this country. And his president, like Biden, thinks about 0:06:04.040 --> 0:06:08.680 his economic plan is fiscal stimulus, plans plural. How do 0:06:08.720 --> 0:06:10.880 you think what's the best way to go about addressing 0:06:10.920 --> 0:06:14.600 some of these issues? Well, you know, you're absolutely right. 0:06:14.640 --> 0:06:17.360 I mean, I think it is fair to say that, 0:06:18.000 --> 0:06:23.800 um that the pandemic, rather than create economic and racial disparities, 0:06:23.839 --> 0:06:27.719 has just exposed and accelerated them. And I think that 0:06:27.839 --> 0:06:32.440 will be very much on his mind and will impact 0:06:32.480 --> 0:06:36.080 his policies. And remember during the campaign he talked about 0:06:36.120 --> 0:06:39.960 the k recovery or recovery that might have an okay 0:06:40.080 --> 0:06:43.440 GDP number, but when you looked beneath it, you would 0:06:43.480 --> 0:06:46.920 find people who are more fortunate Like myself. We've been 0:06:46.960 --> 0:06:50.400 able to continue to work and work from home doing well. 0:06:50.480 --> 0:06:53.640 And you've heard Leo Brainerd at the Federal Reserve estimate 0:06:54.120 --> 0:06:59.359 that for lower income workers or those who can't just 0:06:59.480 --> 0:07:05.440 work from the unemployment rate is close to near depression levels. 0:07:05.520 --> 0:07:08.160 So I think he's going to be looking at that 0:07:08.360 --> 0:07:13.440 very closely. So Number one, you've got to prevent downward falls. Uh. 0:07:13.480 --> 0:07:16.200 You know, recessions are tough, but if you lose your home, 0:07:16.280 --> 0:07:19.440 if you're evicted, if you don't have food on the table, 0:07:19.480 --> 0:07:22.680 I mean, that's that's offensive to our values. That causes 0:07:23.120 --> 0:07:27.920 long term unemployment that many people don't recover from. So 0:07:28.040 --> 0:07:30.120 I think he's gonna you know, I think these policies 0:07:30.160 --> 0:07:32.480 will be very targeted to that, and I think when 0:07:32.480 --> 0:07:35.480 you see him do his jobs plan, there will be 0:07:35.560 --> 0:07:38.800 a lot of focus on making sure, you know, not 0:07:38.840 --> 0:07:42.440 just putting dollars out and hoping people, you know, not 0:07:42.480 --> 0:07:44.600 worrying about who gets hired, but doing it in a 0:07:44.640 --> 0:07:49.120 way that is ensuring you're improving uh, not just homeownership, 0:07:49.200 --> 0:07:52.480 but closing that racial homeownership gap, which is a way 0:07:52.480 --> 0:07:56.040 of closing the racial wealth gap, making sure when you 0:07:56.040 --> 0:07:59.160 you know, most presidents often have just an infrastructure plan 0:07:59.800 --> 0:08:03.080 by I didn't build back better plan includes caregiving jobs 0:08:03.120 --> 0:08:05.800 those tend to be and health workers those tend to 0:08:05.840 --> 0:08:10.000 be often helping more women, helping more more women of color. 0:08:10.440 --> 0:08:13.280 That's very important to him. Gene, who is the next 0:08:13.320 --> 0:08:20.720 federal reserved chair? And uh, you know, you know, uh, 0:08:20.760 --> 0:08:23.040 that's gonna you know that that's going to be the 0:08:23.360 --> 0:08:26.800 you know, one of the fun parlor games among economic 0:08:26.880 --> 0:08:30.880 nerds across the globe. Uh. And I don't want to. 0:08:31.520 --> 0:08:34.040 I guess I have too many friends who were probably 0:08:36.720 --> 0:08:40.800 soon Uh you know, I really I really don't know. 0:08:40.840 --> 0:08:45.040 And I'm gonna I've worked enough with Joe Biden to 0:08:45.160 --> 0:08:47.600 not want to totally second, you know, try to front 0:08:47.679 --> 0:08:50.920 run his choices. I think that I think there's no 0:08:51.000 --> 0:08:55.840 question that the fact that they won Georgia, uh and 0:08:55.920 --> 0:09:00.000 that they do control the Senate does give him more 0:09:00.120 --> 0:09:04.760 discretion to think about picking somebody knew, somebody who might 0:09:04.800 --> 0:09:07.959 be more his own person. But I'm guessing that even 0:09:08.000 --> 0:09:11.480 within the Buying administration, as they're scrambling to get their 0:09:11.520 --> 0:09:15.160 cabinet in and chosen and confirmed, I would bet that 0:09:15.160 --> 0:09:20.280 that decision has not been made. Gen thirty seconds. What's 0:09:20.320 --> 0:09:23.280 the greatest risk to this economy? Here? Markets equit, markets 0:09:23.320 --> 0:09:25.640 hitting all time highs. But what's the risk out there? 0:09:27.080 --> 0:09:30.560 You know, doing too little, doing too little under uh, 0:09:32.200 --> 0:09:35.160 you know, underestimating you know that would end up being 0:09:35.160 --> 0:09:37.520 the problem. Before that, you you can only get one 0:09:37.559 --> 0:09:41.040 bite at the apple, things get worse. Uh. You can 0:09:41.040 --> 0:09:45.960 imagine a new strain that's that's resistant to the new vaccine. 0:09:46.040 --> 0:09:50.360 When I came inven to be any C director, we 0:09:50.360 --> 0:09:52.720 were looking at a strong economic year, and then you 0:09:52.760 --> 0:09:55.560 had the NW clear meltdown in Japan, you had the 0:09:55.720 --> 0:09:59.920 you had the Arab Spring. Things happen, and I think 0:10:00.120 --> 0:10:03.720 that's why what you heard from yelling is the risks 0:10:03.760 --> 0:10:07.600 of going small are much greater than the risk of 0:10:07.720 --> 0:10:10.600 going big. And I think that is going to define 0:10:10.600 --> 0:10:14.600 what you see from this president economically in his first year. 0:10:14.840 --> 0:10:17.840 Gene Sperling, thank you so much for joining us today. 0:10:17.960 --> 0:10:21.920 On everything that we know so far, and the parlor 0:10:22.000 --> 0:10:26.640 games in Washington, d C among economic circles. And you 0:10:26.679 --> 0:10:31.000 know who might actually be filling out the different roles 0:10:31.040 --> 0:10:33.760 in d C over the coming couple of years. Jean Sparling, 0:10:33.760 --> 0:10:36.840 former director of the National Economic Council under Presidents Clinton 0:10:36.960 --> 0:10:42.480 and Obama and president of Sparreling Economic Strategies, joining us there. So, Paul, 0:10:42.520 --> 0:10:45.240 it is an auspicious day. It always is only coming, 0:10:45.400 --> 0:10:48.400 obviously once every four years, and today we're going to 0:10:48.440 --> 0:10:52.000 see President elect Joe Biden and Vice President let Kamala 0:10:52.000 --> 0:10:55.600 Harris sworn in. Yeah, it's gonna be a very unique day, 0:10:55.960 --> 0:10:58.640 unique inauguration, Vanni, with what we're doing with in terms 0:10:58.679 --> 0:11:00.800 of the pandemic and what in a couple of weeks ago, 0:11:00.800 --> 0:11:03.680 but a day of celebration, nonetheless. So let's hand it 0:11:03.679 --> 0:11:06.080 over now to our colleague David Weston, who's going to 0:11:06.080 --> 0:11:08.839 continue for the next three hours with Balance of Power 0:11:12.080 --> 0:11:15.240 Inauguration Day in our nation's capital. Stay tuned for live 0:11:15.360 --> 0:11:17.760 coverage of the inauguration of Joe Biden on a special 0:11:17.920 --> 0:11:20.560 edition of Bloomberg's Balance of Power with David Weston. Our 0:11:20.600 --> 0:11:23.319 Wall Wall coverage starts at eleven a m. Wall Street 0:11:23.360 --> 0:11:26.720 Time on Bloomberg Radio and Television. Let's get a preview 0:11:27.080 --> 0:11:31.040 of what we might experience later today as inauguration takes place. 0:11:31.040 --> 0:11:36.200 We welcome Jennie shan Zano, Bloomberg Politics contributor, author of 0:11:36.240 --> 0:11:41.200 American Democracy in Crisis, also professor Political Science at Iona College. Professor. 0:11:41.280 --> 0:11:42.840 Thanks so much for joining us, Jennie. What do you 0:11:42.880 --> 0:11:46.640 think we're going to hear from soon to be President 0:11:46.800 --> 0:11:51.040 Biden in his inaugural address? You know, what I'm expecting 0:11:51.080 --> 0:11:54.880 to hear is a theme of bipartisanship. This is somebody 0:11:54.920 --> 0:11:57.040 who has been in the Senate for much of his 0:11:57.120 --> 0:12:00.400 adult life. He understands that in order to get all 0:12:00.440 --> 0:12:02.720 of the bills he wants to get passed and addressed 0:12:02.760 --> 0:12:05.439 all of the challenges we're facing, he's going to need 0:12:05.480 --> 0:12:08.040 to work across the aisle. So I expect we're going 0:12:08.080 --> 0:12:11.640 to hear about bipartisanship or reach across the aisle. A 0:12:11.760 --> 0:12:14.600 call for unity that seems to be the buzzword of 0:12:14.640 --> 0:12:18.559 the day. Um. You know, so we've had historic inaugural 0:12:18.640 --> 0:12:21.840 addresses obviously in the past, but I do think that 0:12:21.920 --> 0:12:23.839 it's going to be a stark contrast to what we 0:12:23.920 --> 0:12:27.760 heard in sixteen with the infamous carnage speech. I think 0:12:27.760 --> 0:12:31.840 Biden's tony is going to be completely different from its predecessor, Genie. 0:12:31.880 --> 0:12:35.680 How does Kamala Harris's role manifest She has an opportunity 0:12:35.800 --> 0:12:39.599 right now that previous vice presidents haven't had. How will 0:12:39.600 --> 0:12:43.920 her and Biden define this new role. It's gonna be 0:12:43.960 --> 0:12:47.320 so fascinating because, of course, Kamala Harris a historic pick. 0:12:47.440 --> 0:12:51.000 She's the first woman, she is the first African American 0:12:51.080 --> 0:12:56.040 Indian descent. Of course, also she is likely to be 0:12:56.080 --> 0:13:01.800 the leading candidate for the presidency in we widely expect 0:13:01.840 --> 0:13:04.760 that Joe Biden, given his age at seventy eight, is 0:13:04.840 --> 0:13:07.840 not going to be running again. Um. If that is 0:13:07.880 --> 0:13:11.240 the case, then Kamala Harris is going to be not 0:13:11.320 --> 0:13:14.480 just serving as vice president and helping the president through 0:13:14.840 --> 0:13:18.600 all of these challenges we're facing, but also herself gearing 0:13:18.679 --> 0:13:22.240 up for a run. And that is going to, I 0:13:22.240 --> 0:13:25.000 think be fascinating. And I know you're both probably shocked 0:13:25.040 --> 0:13:30.040 that I'm talking about today, but if we recall Donald Trump, 0:13:30.080 --> 0:13:32.520 I think it was vunny the day of his inauguration 0:13:32.559 --> 0:13:34.880 or the day after he announced he was running in 0:13:36.080 --> 0:13:39.679 so you know, it is really uh, you know, time 0:13:39.720 --> 0:13:42.360 to gear up for four and Kamala Harris is going 0:13:42.400 --> 0:13:46.280 to be a leading contender obviously for that position. So, Jenny, 0:13:46.360 --> 0:13:49.720 the first one days of any president's term tend to 0:13:49.720 --> 0:13:52.840 be very, very busy where they have a lot of 0:13:52.960 --> 0:13:55.520 they try to get a lot of work done. What 0:13:55.559 --> 0:13:58.760 do you think this president can't get done in the 0:13:58.760 --> 0:14:02.280 first one days. It's been fascinating. He's been talking about 0:14:02.360 --> 0:14:05.080 not just the one hundred day marker, which we're so 0:14:05.200 --> 0:14:07.560 used to in the U s. Sort of this historic day, 0:14:07.600 --> 0:14:11.120 a hundred days, he's been talking about ten days. And 0:14:11.160 --> 0:14:14.600 what we expect is he is immediately as early as today, 0:14:14.960 --> 0:14:19.000 going to be sending to Congress a massive immigration bill 0:14:19.480 --> 0:14:22.520 um that I think is going to be a sweeping 0:14:22.600 --> 0:14:27.600 proposal to provide citizenship for eleven million undocumented people living 0:14:27.600 --> 0:14:30.960 in the United States. We also expect in the first day, 0:14:31.040 --> 0:14:33.880 just this afternoon, he's going to sign a series of 0:14:33.920 --> 0:14:37.800 executive orders dealing with everything from the environment and climate again, 0:14:37.840 --> 0:14:41.200 to immigration, to the public health crisis COVID, and to 0:14:41.360 --> 0:14:44.240 racial justice. So he has a lot on his plate, 0:14:44.360 --> 0:14:46.680 not just in the first hundred days, but in the 0:14:46.760 --> 0:14:49.480 first day, because he's expected to be in the Oval 0:14:49.520 --> 0:14:54.000 Office working as early as this afternoon. President Hump earlier 0:14:54.040 --> 0:14:57.240 this morning made some remarks to reporters and also obviously 0:14:57.360 --> 0:15:01.240 made some remarks on the podium before he left Joint 0:15:01.240 --> 0:15:04.120 Bass Andrews. He said we will be back, and he 0:15:04.160 --> 0:15:05.880 had told reporters hopefully it's not going to be a 0:15:05.920 --> 0:15:08.680 long goodbye. I'm curious as to what you think President 0:15:08.680 --> 0:15:11.480 Trump will try to do next, particularly given that among 0:15:11.480 --> 0:15:15.920 the pardons where Steve Bonna, we were expecting some that 0:15:15.960 --> 0:15:18.080 we didn't get, and then we did get the Steve 0:15:18.080 --> 0:15:20.880 Bonn on one. What was the significance of the significance 0:15:20.920 --> 0:15:24.000 in my mind, is that exactly tied to this we 0:15:24.080 --> 0:15:27.400 will be back statement that he made. I think the president, 0:15:28.160 --> 0:15:32.320 the President Trump expects that he or members of his family, 0:15:32.480 --> 0:15:34.880 his daughter, his daughter in law, and his son, all 0:15:34.920 --> 0:15:37.680 looking at potential races in Florida and the South part 0:15:37.680 --> 0:15:40.680 of the United States, may rely on somebody like as 0:15:40.760 --> 0:15:43.880 Steve Bannon to be an advisor for potential runs for 0:15:43.920 --> 0:15:47.360 Congress and potentially if a President Trump, former President Trump 0:15:47.440 --> 0:15:50.280 decides to run again. So I think you're absolutely right. 0:15:50.560 --> 0:15:52.920 I was also struck by his remarks in terms of 0:15:52.920 --> 0:15:55.960 how he took credit for what is going to happen 0:15:56.000 --> 0:15:59.040 in the Biden administration, saying that he laid the foundation 0:15:59.400 --> 0:16:01.760 for what ever good they're able to achieve with a 0:16:01.760 --> 0:16:03.920 lot of luck. So it was sort of the first 0:16:03.960 --> 0:16:07.720 time I've heard somebody take credit prior to his successor 0:16:07.880 --> 0:16:11.680 entering office. So I thought that was fascinating as well. Jennie, Realistically, 0:16:11.880 --> 0:16:14.920 what do you think um soon to be President Biden 0:16:15.000 --> 0:16:18.120 can get done legislatively? He has obviously a long track 0:16:18.160 --> 0:16:25.480 record in Congress, bipartisan historical record. Can he bring reluctant 0:16:25.520 --> 0:16:28.640 Republicans and maybe some Democrats over to his side to 0:16:28.720 --> 0:16:32.920 get meaningful legislation done. He's going to have to do that, 0:16:33.000 --> 0:16:35.840 And I want to be optimistic on this day of 0:16:35.880 --> 0:16:39.040 sort of celebration and say yes he can. As you mentioned, 0:16:39.040 --> 0:16:41.600 he's perfectly situated to do that given his history in 0:16:41.640 --> 0:16:44.560 the Senate and of reaching across the aisle. I'm not 0:16:44.640 --> 0:16:46.320 so sure he's going to be able to get the 0:16:46.360 --> 0:16:48.880 bills that he wants passed in the way he wants. 0:16:48.920 --> 0:16:52.240 For instance, this almost two trillion dollar stimulus bill we're 0:16:52.320 --> 0:16:57.400 already hearing yesterday, during the confirmation, hearings pushback from Republicans 0:16:57.400 --> 0:17:00.560 on things like the fifteen dollar minimum wage, on the 0:17:00.720 --> 0:17:05.240 fourteen hundred dollars called by Marco Rubio also contender for 0:17:05.240 --> 0:17:07.879 a more piecemeal approach, So there is going to be 0:17:07.960 --> 0:17:11.000 pushed back from Republicans, and I suspect in the case 0:17:11.040 --> 0:17:15.479 of COVID immigration and the other bills infrastructure that he 0:17:15.560 --> 0:17:19.520 wants to get past, these are going to be watered down, 0:17:19.600 --> 0:17:21.560 if you will. I don't think we'll get at one 0:17:21.640 --> 0:17:23.800 point nine trillion dollar. I think we're going to be 0:17:23.840 --> 0:17:26.000 closer to a one trillion dollar bill at the end. 0:17:26.359 --> 0:17:29.000 It's going to be a negotiation for sure, because he 0:17:29.040 --> 0:17:32.720 needs not just the moderate Republicans, he needs to also 0:17:32.840 --> 0:17:34.960 maintain the Democrats. And I would say one thing to 0:17:35.000 --> 0:17:38.560 watch for Democrats or Republicans who leave their party. Genie. 0:17:38.720 --> 0:17:41.480 Thank you. Genie will be contributing throughout the day, so 0:17:41.560 --> 0:17:44.560 do continue to listen and watch a Genie. Sean Zano 0:17:44.640 --> 0:17:48.359 Bloomberg politics contributor, professor at Iona College and author of 0:17:48.560 --> 0:17:54.560 a new book, American Democracy in Crisis. This is Bloomberg. Well, 0:17:54.600 --> 0:17:57.560 we're just seeing continued gains here for you as equities 0:17:57.560 --> 0:18:00.840 with an ASDAG up one point seven recent now more 0:18:00.840 --> 0:18:02.919 than one percent on the ten year yield at one 0:18:02.960 --> 0:18:06.320 oh ninety eight. Let's bring in Bloomberg process that reporter 0:18:06.480 --> 0:18:08.720 Sarah Ponsa to give us an idea of what markets 0:18:08.720 --> 0:18:11.920 are really concentrating on today. Would seem that the dollar 0:18:12.000 --> 0:18:14.760 index is a little bit weaker relative to, for example, 0:18:14.800 --> 0:18:17.639 the Canadian dollar. But other than that, it's all about equity, Sarah. 0:18:17.920 --> 0:18:19.879 It is all about equities today, and we see the 0:18:19.920 --> 0:18:22.320 NAZAC at record highs, we see the SMP five hundred 0:18:22.359 --> 0:18:24.480 at record highs. We also see the Russell two thousand 0:18:24.480 --> 0:18:27.280 at record highs. So from small caps to large caps, 0:18:27.320 --> 0:18:30.239 but really asserting itself in the markets today is the 0:18:30.280 --> 0:18:33.359 Fame trade once again, this after Netflix was the first 0:18:33.400 --> 0:18:36.160 of the group to report earnings yesterday after the bell 0:18:36.560 --> 0:18:39.840 and really just performing. You could say, we saw a 0:18:39.880 --> 0:18:42.679 net new subscribers coming at eight point five one million 0:18:42.760 --> 0:18:45.600 that not only beat Netflix his own forecast, but it 0:18:45.680 --> 0:18:48.320 also beat the expectations from analysts on Wall Street of 0:18:48.400 --> 0:18:51.080 six point six million. On top of that, they finally 0:18:51.119 --> 0:18:53.600 passed two hundred million subscriber mark. At the same time, 0:18:53.640 --> 0:18:56.120 they said cash flow will now allow it to stop 0:18:56.119 --> 0:18:59.680 relying on debt to fuel growth. So we see Netflix 0:18:59.720 --> 0:19:03.639 this morning up almost fifteent, trading out a new record high, 0:19:03.840 --> 0:19:06.720 and you see the other fang names just trading in tandem. 0:19:06.760 --> 0:19:09.680 You look at your best performers on a points basis, 0:19:09.720 --> 0:19:12.160 at least in the SMP five dred as we speak, 0:19:12.240 --> 0:19:15.480 that's Apple, Microsoft, Amazon, each up at least two and 0:19:15.520 --> 0:19:18.960 a half percent this morning. Yeah, it's just extraordinary story 0:19:19.040 --> 0:19:20.960 last night with Netflix. I think the other big thing, 0:19:21.280 --> 0:19:23.840 Sarah as the company said that you know they're gonna 0:19:23.840 --> 0:19:26.720 be free cash flow positive pretty quickly, I think a 0:19:26.720 --> 0:19:29.320 little bit faster than the street expected. So kind of 0:19:29.320 --> 0:19:32.280 showing how that company is really matured and really kind 0:19:32.280 --> 0:19:35.200 of grown into its its growth story. Oh surely, and 0:19:35.359 --> 0:19:37.480 coming into this earning season, A big question for the 0:19:37.520 --> 0:19:41.119 likes of Netflix, maybe Amazon. You think of other large 0:19:41.160 --> 0:19:46.560 technology companies that benefited all of and even benefited from 0:19:46.600 --> 0:19:49.160 the rollout of of COVID nineteen and the play out 0:19:49.359 --> 0:19:51.840 and people forced to stay at home and work from home. 0:19:52.119 --> 0:19:54.800 The question really has been, we know that business was 0:19:54.880 --> 0:19:58.840 pulled forwards for them. We know that many people bought 0:19:58.960 --> 0:20:01.199 Netflix of scripture because they were stuck at home with 0:20:01.280 --> 0:20:03.879 nothing else to watch, and and they needed to. We 0:20:03.920 --> 0:20:06.800 know that happened. Another question is what comes next for 0:20:06.880 --> 0:20:09.560 these businesses. And there's been this push and pull when 0:20:09.560 --> 0:20:13.200 we hear investors talk about this rotation not just from 0:20:13.280 --> 0:20:17.679 from growth to value, but from defensives to cyclicals, and 0:20:17.800 --> 0:20:20.280 the idea that we might see this shift into the 0:20:20.320 --> 0:20:23.080 reopening play from the stay at home trade. But it 0:20:23.200 --> 0:20:26.560 makes you think when you see these companies continue to 0:20:26.640 --> 0:20:30.560 deliver uh growth companies, And this is also an argument 0:20:30.640 --> 0:20:32.960 that's made. It's it's not as if they are going 0:20:33.040 --> 0:20:36.160 to just drift off it and everyone's gonna stop talking 0:20:36.200 --> 0:20:38.240 about them, and they're no longer going to be strong 0:20:38.280 --> 0:20:40.560 companies like you pointed out Netflix now going to be 0:20:40.600 --> 0:20:43.879 cash flow positive. I mean, these are strong companies and 0:20:43.960 --> 0:20:47.159 it makes you wonder if we can see this reopening trade. 0:20:47.200 --> 0:20:51.280 Small caps continue to run, but in tandem with big 0:20:51.359 --> 0:20:55.440 tech and and streaming companies like Netflix that did very 0:20:55.480 --> 0:20:59.840 well in How much is the market reacting to John 0:20:59.840 --> 0:21:02.399 at Yellen's testimony. Obviously she is going to be the 0:21:02.440 --> 0:21:05.159 next to insury secretary. It's you know, almost without a 0:21:05.200 --> 0:21:07.360 doubt that she'll be voted in by sort of all 0:21:07.640 --> 0:21:12.760 sides of Congress um and therefore, you know, will try 0:21:12.800 --> 0:21:15.880 to implement a lot of what Joe Biden has been annunciating, 0:21:15.880 --> 0:21:18.160 the one point nine trillion dollars in stimulus and so on. 0:21:18.240 --> 0:21:21.320 How much is today's trade off the back about not 0:21:21.440 --> 0:21:24.040 too much. I mean, we've known that Janet Yellen was 0:21:24.080 --> 0:21:26.960 going to be Treasury Secretary for quite a while. Now, 0:21:27.040 --> 0:21:30.200 she's also a known entity on Wall Street. The expectation 0:21:30.320 --> 0:21:32.880 is that there really shouldn't be too many surprises here. 0:21:33.240 --> 0:21:35.160 She has been touting the one point nine trillion dollar 0:21:35.200 --> 0:21:37.359 stimulus package. On the back of that, we have seen 0:21:37.640 --> 0:21:41.359 inflation expectations pick up tad Currently I'm looking at tenure 0:21:41.400 --> 0:21:44.399 break even inflation expectations holding around two point one to 0:21:45.000 --> 0:21:48.480 per center. So now there were some surprises yesterday. Max 0:21:48.560 --> 0:21:51.439 Gochman over Pacific Life Fund Advisors actually reached out to 0:21:51.440 --> 0:21:54.560 me to say that what was surprising within her testimony 0:21:54.920 --> 0:22:00.280 was her discussion of tax hikes, saying that it's going 0:22:00.320 --> 0:22:02.680 to come immediately, but possibly we could see a change 0:22:02.720 --> 0:22:04.960 to the tax code as part of the infrastructure plan. 0:22:05.320 --> 0:22:07.320 So that maybe did take some infestors off guard, But 0:22:07.359 --> 0:22:11.080 I wouldn't say necessarily that the testimony that we are 0:22:11.080 --> 0:22:14.520 seeing from Janet Yellen is affecting stock prices, or the 0:22:14.560 --> 0:22:17.399 bond market or the dollar today for instance. I mean, 0:22:17.560 --> 0:22:19.600 she's a known entity on Wall Street and we've known 0:22:19.680 --> 0:22:21.680 for quite a while now that she was the nominee 0:22:21.720 --> 0:22:25.720 as well. Fiscal stimulus sarah um, you know, one point 0:22:25.880 --> 0:22:30.360 nine trillion plan proposed. Hearing some pushback that it's not 0:22:30.480 --> 0:22:32.800 all going to get past. What do you think the 0:22:32.840 --> 0:22:37.280 market's kind of discounting here about this next round of stimulus? Right, So, 0:22:37.320 --> 0:22:39.160 there has been some pushback the idea that we might 0:22:39.160 --> 0:22:42.240 not see it all get past or all get past immediately. 0:22:42.400 --> 0:22:47.160 But we haven't seen any negative reaction to this pushback 0:22:47.560 --> 0:22:51.359 whatsoever in markets. I mean, you see benchmarks today trading 0:22:51.400 --> 0:22:54.560 at record highs. You see the tenure not really moving 0:22:54.600 --> 0:22:57.240 all that much, but still holding above one percent and 0:22:57.280 --> 0:22:59.760 well above one percent now at one point nine percent 0:23:00.400 --> 0:23:03.800 and holding. So we're not seeing much reaction in the markets. 0:23:03.840 --> 0:23:06.240 And we've heard it many times, the idea that the 0:23:06.280 --> 0:23:09.480 market is forward looking and the expectation, it seems is 0:23:09.480 --> 0:23:12.640 that even if if it's not done immediately, it will 0:23:12.680 --> 0:23:15.639