Speaker 1: Bloomberg Audio Studios, podcasts, radio news.
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Speaker 3: And re sheats with Us Now with Morgan Stanley. Were
Speaker 3: thrilled that he could be with us today. Andrew, the
Speaker 3: first thing I did in honor of your Brown University
Speaker 3: of Mathematics is I took course EPI this series, not
Speaker 3: the year over your month of a month the series,
Speaker 3: and I don't have a first or second derivative convexity
Speaker 3: towards disinflation. Does Morgan Stanley see disinflation in place or
Speaker 3: can you not say that after the report?
Speaker 4: Yeah, so we do see disinflation in place, although you
Speaker 4: know not yet. Inflation is still holding up through the
Speaker 4: end of the year. Where we, I think are a
Speaker 4: little bit more optimistic on inflation than the consensus is
Speaker 4: next year where we see inflation coming down, and I
Speaker 4: think importantly it's really coming down in the first half
Speaker 4: of the year, where for the incoming Trump administration, we
Speaker 4: think it's going to be a case where policy has
Speaker 4: kind of fast announcement but slow implementation. You don't get
Speaker 4: the inflationary effects of tariffs of immigration changes until kind
Speaker 4: of in the back half of twenty twenty five and
Speaker 4: in the first part of the year. We think that
Speaker 4: a lot of the inflation which is being driven by
Speaker 4: shelter auto insurance, that that can come down, That those
Speaker 4: series are running kind of well ahead of where the
Speaker 4: real economy markets for those are, and that some of
Speaker 4: the difficult seasonality in January and February, which previously has
Speaker 4: boosted inflation, we think that actually sets an attractive bar
Speaker 4: that might make it a little bit easier for inflation
Speaker 4: to be a little bit better than expected. So we
Speaker 4: do see inflation coming down. We see that disinflation the
Speaker 4: first half of the year, and we think that will
Speaker 4: mean that the FED cuts not just this month but
Speaker 4: in January as well.
Speaker 5: Is that so get a sense there, Andrew, where out
Speaker 5: there are you suggesting your clients really think about adding
Speaker 5: some risk, if anywhere, as a thing about twenty twenty five.
Speaker 4: Yeah, So I think as a house, I think we
Speaker 4: are more optimistic than consensus on duration. We think that
Speaker 4: vond yields will fall. We think that that fall will
Speaker 4: be concentrated in the first half of the year, as
Speaker 4: the FED ends up cutting a little bit more than expected,
Speaker 4: as inflation falls a little bit more than expected, and
Speaker 4: as I think some of again, some of the inflationary
Speaker 4: impacts of policy change take longer than expected to develop.
Speaker 4: And you know, I think an important part that our
Speaker 4: interest rate strategists have been talking about, but it also
Speaker 4: applies to credit, is you know, fixed income markets have
Speaker 4: been operating under this very difficult environment of a very
Speaker 4: flat or inverted yield curve. There's been very little carry
Speaker 4: in the asset class. If the FED continues to cut
Speaker 4: as we expect, if the ECB continues to cut as
Speaker 4: we expect, we think the European Central Bank will take
Speaker 4: policy rates down to just one percent by the end
Speaker 4: of next year. That's going to provide I think, a
Speaker 4: much better carry environment for fixed income and be support
Speaker 4: of adoration credit risk.
Speaker 5: How much credit risk are you suggesting folks take here
Speaker 5: these days, given that the two year treasuries at four
Speaker 5: point one.
Speaker 4: So I think credit's also a story. I think of
Speaker 4: a little bit a better first half and then maybe
Speaker 4: a more challenging second half. So spreads are low you know,
Speaker 4: I don't think this is a case where ourselves are
Speaker 4: really any credit investor is loading up on a large
Speaker 4: amount of credit risk. But it's also one where I
Speaker 4: think you have to be kind of careful about timing
Speaker 4: that short or timing that underweight.
Speaker 6: The credit.
Speaker 4: We think can remain somewhat tighter for longer than the
Speaker 4: markets expecting. So we're expecting US credit spreads, European credit
Speaker 4: spreads to actually be a little bit tighter by the
Speaker 4: middle of next year and then maybe have a more
Speaker 4: difficult second half.
Speaker 3: Andrew, just your one final question here. It's too short
Speaker 3: a visit today. We want to get you on for
Speaker 3: much longer chat as well. You're sitting over the holidays
Speaker 3: and you've got family members going Andrew, we don't understand
Speaker 3: your world. But as capitalism is finance in place, is
Speaker 3: this a normal time?
Speaker 4: Well, I think what we are looking at is is
Speaker 4: a much wider range of outcomes looking ahead. And I
Speaker 4: think the new incoming administration increases the odds of boom
Speaker 4: and a larger capital market rebound, and it increases the
Speaker 4: odds of stagflation, of weaker growth and higher inflation. If
Speaker 4: you look at Morgan Stanley's Economic Outlook, our strategy outlook,
Speaker 4: which we published a couple of weeks ago. You'll see
Speaker 4: that in our forecast. You'll see that in our numbers.
Speaker 4: You'll see that in this wider range of outcomes. So
Speaker 4: I think we are moving from a very moderate outcome
Speaker 4: which was outstanding for credit and good for the equity
Speaker 4: market as well, to something that's a lot less moderate,
Speaker 4: and it might not be bad, it might be good,
Speaker 4: but it's a wider range of outcomes that we're dealing with.
Speaker 3: Just short of visit Andersy's Thank you so much. We'll
Speaker 3: do it again, Morgan Stanley.
Speaker 2: You're listening to the Bloomberg Surveillance Podcast. Catch us live
Speaker 2: weekday afternoons from seven to ten am Eastern Listen on
Speaker 2: Apple car Play and Android Auto with a Bloomberg Business app,
Speaker 2: or watch us live on YouTube.
Speaker 3: When you get a new office at Stanford University, yeah,
Speaker 3: you know, it's like you live in here.
Speaker 6: I mean it's like gorgeous.
Speaker 7: Out there, I know, perfect.
Speaker 3: Her public service to this nation has been extraordinary. We're
Speaker 3: gonna squeeze in a couple of minutes here. She has
Speaker 3: just served secretary of Ramando at Commerce, but far more
Speaker 3: before that, she served all of us with absolutely definitive
Speaker 3: coverage of China. Her Third Revolution is a definitive cover
Speaker 3: to cover. Read on President she Elizabeth Economy now at
Speaker 3: Stanford University, doctor Economy, Thank you so much for joining
Speaker 3: Bloomberg Surveillance. What is our intelligence on Beijing is a
Speaker 3: general sense. Do we know what's going on with the
Speaker 3: Chinese leader ship?
Speaker 1: I think we have a reasonably good idea of where
Speaker 1: she Jinping wants to take the country. If you're asking,
Speaker 1: do we have a good visibility into the inner workings
Speaker 1: of the Standing Committee of the Polipio, the top seven
Speaker 1: people that rule the country, I have to say the
Speaker 1: answer is probably not at this point. But I think
Speaker 1: we have a fairly clear sense both in terms of
Speaker 1: what China's doing at home and its foreign policies about
Speaker 1: overall directionally where She Didn't Ping wants to take the country.
Speaker 6: How is their military projection?
Speaker 3: I mean from the budget standpoint, we can talk about
Speaker 3: deflation in China and the capitalism or non capitalism of China.
Speaker 6: But the fear, the arch fear across all including the
Speaker 6: South China Sea. Is there military projection? Are they funding?
Speaker 6: Are they a defense? Are they an offense juggernaut. Oh absolutely.
Speaker 1: I mean they have the largest military in the world
Speaker 1: there maybe is now larger than in ours. You can
Speaker 1: see with the activity that they've been undertaking over the
Speaker 1: past six months, you know, sort of accelerated military activity
Speaker 1: in the Taiwan straight in the South China Sea, very aggressive,
Speaker 1: and I think this is all part of one of
Speaker 1: Chijinping's major sort of directives is really to reclaim the
Speaker 1: territory that he considers to be Chinese sovereign territory. And
Speaker 1: so I think they use any excuse they can to
Speaker 1: sort of do these military exercises, I think in the
Speaker 1: hopes basically to coerce other countries and Taiwan just to
Speaker 1: accede to Chinese demands. That hasn't happened yet, but I
Speaker 1: think that really is the intention. So there's been no
Speaker 1: letup despite the challenges in the Chinese economy, There's been
Speaker 1: no letup in terms of their spending on defense, in
Speaker 1: terms of the overall trajectory of their military and their
Speaker 1: desire to be able to project force and meaningful ways.
Speaker 5: Doctor economy, What do you believe the Chinese view is
Speaker 5: of President elected Trump here?
Speaker 1: So I think, look there as many views in China
Speaker 1: about President Trump as there are in the United States.
Speaker 1: I think there are people who welcome President Trump for
Speaker 1: a range of reasons. There are people who are kind
Speaker 1: of you know, maga Chinese who like the President's views
Speaker 1: around values, or at least the views that were expressed
Speaker 1: during the campaign around values. There are people who think
Speaker 1: that President Trump is going to be good for China
Speaker 1: because he's going to hold the United States, you know,
Speaker 1: back out of a number of international institutions, things like
Speaker 1: the World Health Organization or the Paris Climate Accords and
Speaker 1: leave a lot of space for China to assert its
Speaker 1: leadership on the global stage. People who think that there
Speaker 1: are going to be problems between the United States and
Speaker 1: our allies because President Trump has a sort of more
Speaker 1: transactional approach to how to navigate our relations there. And so,
Speaker 1: you know, we saw a lot of problems in the
Speaker 1: first Trump term with our European allies that China tried
Speaker 1: to exploit. I think they're thinking in those terms again,
Speaker 1: you know, are they going to have opportunities like that?
Speaker 1: At the same time, of course, President Trump has promised
Speaker 1: variously to level you know, sixty percent tariffs on you know,
Speaker 1: all Chinese exports twenty five percent tariffs, ten percent tariffs.
Speaker 1: We don't know where you know, the numbers in the land.
Speaker 6: We don't know.
Speaker 1: Whether it's going to be you know, whether the terrafs
Speaker 1: are basically the threat of tariffs is basically a tool
Speaker 1: to get China back to the matiating table. All of
Speaker 1: these things are sort of up in the air at
Speaker 1: this point in time, so a mix of views. I
Speaker 1: think about what president might mean for the country, and one.
Speaker 3: Of the chapters lives in the Third Revolution, The Lion awakens.
Speaker 3: That is the arch fear by partisan fear of America.
Speaker 3: You live this in real time with Gina Romando at
Speaker 3: Commerce in the Trump administration.
Speaker 6: We assume the lion away weakens. How do we quiet
Speaker 6: the lion and the coming four years?
Speaker 1: I mean, I'm not sure that there's really a way
Speaker 1: to quiet the lion. I think there's a way to
Speaker 1: ensure that the United States, you know, is the dragon.
Speaker 8: I guess in the.
Speaker 1: In the sense that you know, what I think our
Speaker 1: message should be is that we're still looking toward US
Speaker 1: leadership on the global stage, right, and US technological leadership
Speaker 1: and military leadership and leadership and the values domain. I think,
Speaker 1: to me, what we want to do is to run faster.
Speaker 1: I sometimes worry that we over index on our defensive tools,
Speaker 1: and so that would be a concern. I think with
Speaker 1: President Trump and you know, sort of the approach of
Speaker 1: just levy more tariffs, I'd like to see us invest more,
Speaker 1: you know, in science and technologies. We're still waiting to
Speaker 1: see the science right of the Chips Act. I think that,
Speaker 1: to me is what the United States needs to do
Speaker 1: and not simply say we don't want China to do this,
Speaker 1: stop China from doing that.
Speaker 3: Liz, you're twenty something and you're at Michigan, and you
Speaker 3: change the world where the river runs black on the
Speaker 3: environment in China, You, more than anyone has been over
Speaker 3: there more often. GM just pulled out of China. Effectively,
Speaker 3: Is American investment dead in terms of JV or investment
Speaker 3: in China.
Speaker 1: It's not dead, but there certainly has been a precipitous
Speaker 1: fall off. And it's not just the United States. It's
Speaker 1: you know, FDI into China overall. So our European partners
Speaker 1: are the same way, you know, Asian partners, same thing.
Speaker 1: I think there's just a sense that China has not
Speaker 1: been welcoming to private enterprise. Combination of factors, things like
Speaker 1: the anti espionage law, you know, controls around data, the
Speaker 1: lack of information around what's going on inside the Chinese economy, rights,
Speaker 1: the Chinese have been constraining, constricting the types of economic
Speaker 1: information that they're willing to share. And then there are
Speaker 1: Chinese you know, areas where China has just become far
Speaker 1: more competitive, And I think the car industry is a
Speaker 1: good example of that, where where I think multinationals find
Speaker 1: it more difficult to compete. But China doesn't want FDI
Speaker 1: to drop off this way, but they're they're sort of caught,
Speaker 1: I think, in a bind because she didn't Pink isn't
Speaker 1: really willing to undertake the steps necessary to open the
Speaker 1: door back up to private enterprise, even in his own
Speaker 1: private enterprise.
Speaker 5: I think it's probably exactly and that's kind of where
Speaker 5: I wanted to go, Elizabeth. I mean, does President g
Speaker 5: I mean closing off his country to foreign direct investment
Speaker 5: and show just the world it's not just technology, it's
Speaker 5: just broader trade. And is there real support for that
Speaker 5: type of policy in China?
Speaker 1: Well, I think, you know the way that she didn't
Speaker 1: Pink can drum up support for this, and so let
Speaker 1: me say, I think certainly not. I think that, you know,
Speaker 1: the private sector in China has certainly suffered over the
Speaker 1: past decade and some there. I don't think there is
Speaker 1: a lot of support. There were four oriented economists who've
Speaker 1: tried to get Hegen Pin to you know, take his
Speaker 1: hands off the controls. So I think, no, I don't
Speaker 1: think there's widespread support. But I do think to the
Speaker 1: extent that China feels as though it's under assault from
Speaker 1: things like terriffs or export controls, that bolsters siege in
Speaker 1: Pin's you know, argument for duel circulation, the argument that
Speaker 1: China can innovate, manufacturer and consue largely within itself. Again,
Speaker 1: teach and Pink doesn't want to close off you know all.
Speaker 1: He certainly wants China to export, and he wants companies
Speaker 1: to invest in China. He wants them to bring you know,
Speaker 1: high technology stuff that China doesn't have, Hey welcomes. But
Speaker 1: he's also committed to making China, you know, indigenously capable.
Speaker 3: What is your first I mean, I think about Jonathan
Speaker 3: Spence holding cord a Yale.
Speaker 6: What a privilege it would have been to be in
Speaker 6: that classroom.
Speaker 3: It's Stanford among the elite chair of Li's Economy.
Speaker 6: What's your first message in the first.
Speaker 3: Lecture on Liz Economy's China.
Speaker 1: China has a transformative vision for the international system and
Speaker 1: for China's place within it. And the United needs the
Speaker 1: United States needs to step up its game.
Speaker 3: Good Liz, we need another book. Get to work. I
Speaker 3: mean she's working like a four hour work week.
Speaker 6: Got at Stanford, Elizabet.
Speaker 8: At sixteen to do this.
Speaker 2: What do you mean?
Speaker 7: Yeah?
Speaker 3: Ce it Eli's coffee on Madison. Elizabe Economy. Thank you
Speaker 3: so much for joining us. She's professor at Stanford University.
Speaker 2: This is the Bloomberg Surveillance Podcast. Listen live each weekday
Speaker 2: starting at seven am Eastern on applecar Play and Android
Speaker 2: Auto with the Bloomberg Business app. You can also listen
Speaker 2: live on Amazon Alexa from our flagship New York station,
Speaker 2: Just say Alexa playing Bloomberg eleven thirty joining us.
Speaker 3: Now, I'm gonna give you a two short an introduction.
Speaker 3: He deserves a much longer one. Is Robert Hormats. Some
Speaker 3: people talk, others do. And back to the tenure of
Speaker 3: Secretary Kissinger. Bob Hormantz has traveled the miles of the
Speaker 3: Levant and Eastern Mediterranean and Chaos. Now to be clear here,
Speaker 3: you weren't there for the Great Syrian revolt of nineteen
Speaker 3: twenty five nineteen twenty seven.
Speaker 6: You missed that one.
Speaker 3: Why is Syria different now than the mess Paul Swenian
Speaker 3: I grew up with what's different now versus Kissinger and
Speaker 3: Hormats in the seventies Two things.
Speaker 7: Mainly One, you had hauffazilas On running the place, the
Speaker 7: father of the father of the son who's just vacated
Speaker 7: his throne to go to to go to Russia. But
Speaker 7: Huffazilason did not want big dust ups with the Israelis.
Speaker 7: As a matter of fact, he was the one who
Speaker 7: created that buffer zone that is now being occupied appropriately
Speaker 7: by Israel because Assyrians will pull out of it. But second,
Speaker 7: we in trying to get a settlement in the Sinai
Speaker 7: we always tried to keep good relations with the Saudis,
Speaker 7: Assyrians and others, the UAE and other countries in the region,
Speaker 7: including the Iraqis so and even the Iranians at that point,
Speaker 7: so there was a much better dialogue among the various
Speaker 7: countries to try to get some disengagement between the Israelis
Speaker 7: and the Egyptians, which ultimately did work, but it took
Speaker 7: You have in the Middle East, you have to see
Speaker 7: a lot of people because there are a lot of
Speaker 7: power centers. And the other thing in Syria is it's
Speaker 7: really an amalgam. We have the Kurds, you have the Allowhites,
Speaker 7: you have the Sunnis, you have the Shiites, and they're
Speaker 7: all taking different points of view.
Speaker 6: Hormance owns this. I just watched Lawrence of Arabia, but
Speaker 6: Hormance owns it.
Speaker 5: What does this mean, this change we're seeing taking place
Speaker 5: in Syria, what does it mean for Russia and Iran
Speaker 5: in that part of the world.
Speaker 7: There it dramatically weakens Russia's presence there. Russia is seen
Speaker 7: by the Syrian people as having supported Basha Alasad. They
Speaker 7: are not very well liked. They have one base, Latika,
Speaker 7: and then they have a seaport. They want to keep them.
Speaker 7: I think that'll be part of the negotiation, but I
Speaker 7: can't imagine the average Syrian wants them to stay there.
Speaker 7: And Iran has had its allies in effect get decapitated
Speaker 7: or weakened very badly, so all of its tentacles. The
Speaker 7: essentially the hoodies are still there, but the others are
Speaker 7: are are gone.
Speaker 3: Should the US folks let Erdawan take the northern border
Speaker 3: of Syria to the southern border of Turkey, worry about
Speaker 3: the Kurds. That's never going to go away. Should the
Speaker 3: United States project to south southern and southwestern Syria to
Speaker 3: try to provide stability around damasks north to homes or
Speaker 3: do there's there a different approach?
Speaker 7: Well, that's there are two really good points there. One,
Speaker 7: I think we have to work closely with the Turks,
Speaker 7: but I also think that we have to remember that
Speaker 7: the Kurds were part of the coalition of forces that
Speaker 7: overthrew assad and therefore we have done a lot of
Speaker 7: bad things to the Kurds and sort of pulled the
Speaker 7: red out from undum of the past. I think we
Speaker 7: want to try to convince the Turks to work with
Speaker 7: the Syrian Kurds and not go in there and take
Speaker 7: advantage of this and weaken them.
Speaker 5: Okay, this is.
Speaker 6: Too an important conversation. I'm not going to mince words.
Speaker 3: I got to tweet out this morning with the President
Speaker 3: elect making fun of Canada is a fifty first state.
Speaker 3: Do we have a potential sobriety and gravitas in state
Speaker 3: to handle these incredible nuances of the Levant.
Speaker 6: I don't see it well.
Speaker 7: It's very complicated. People in the past have been found
Speaker 7: have found it very difficult. But you know the the
Speaker 7: You have to work with the with the Kurds because
Speaker 7: they're part of this coalition. You have to work with
Speaker 7: the Turks because they're actually now the most powerful country
Speaker 7: other than Israel in the area. And Iran's ability to
Speaker 7: exercise influence has diminished dramatically. The Hesballah has been weakened.
Speaker 7: It's it's friends in Syria are gone. That whole notion
Speaker 7: of moving arms from from the Iran two Lebanon is
Speaker 7: really diminished, or if probably eliminated for the moment. So yeah,
Speaker 7: we have to have a very subtle diplomacy and you
Speaker 7: have to talk to all the parties. That's the one
Speaker 7: thing we learned about the Shuttle diplomacy. You couldn't just
Speaker 7: talk to the Egyptians and the Israelis. You had to
Speaker 7: talk to others because it's a complicated area. If you
Speaker 7: want to reserve preserve peace, you've got to have a
Speaker 7: dialogue with a lot of people, and that means sort
Speaker 7: of steady focus.
Speaker 5: What do you think under president like Trump, our role
Speaker 5: will likely be in that part of the world over
Speaker 5: the next several years.
Speaker 7: I think he's probably of the view that we should
Speaker 7: pull back and do relatively little. I don't think he.
Speaker 7: I mean, he has this fierce or a lot of
Speaker 7: people around him have his fierce anti Iranian point of view.
Speaker 7: And the Iranians now are probably going to be spending
Speaker 7: less money on their friends and allies in the region,
Speaker 7: who are now for the most part, decapitated or unable
Speaker 7: to perform anything like what the Iranians hope, which was
Speaker 7: their surrogates in the region. They can't play that role anymore.
Speaker 7: So the Iranians probably are going to spend more time
Speaker 7: on nuclear On the other hand, they to strengthen their
Speaker 7: own power. On the other hand, we have to demonstrate
Speaker 7: that we have good allies in the region, good friends
Speaker 7: in the region, and strength and relations both with Israel
Speaker 7: and with the Sunni Arabs on the other side of
Speaker 7: the Gulf.
Speaker 3: Anxiously awaiting Robert D. Hormats The Price of Liberty.
Speaker 6: Two point zero. We expect that book the movie rights
Speaker 6: have already been sold. The Heart and soul.
Speaker 3: A hormantce diplomacy is a fiscal soundness at home. What
Speaker 3: happened by mormance.
Speaker 7: What happened is that fiscal policy is broken in this country,
Speaker 7: that each side makes compromises with the other on tax
Speaker 7: cuts or spending increases. The budget deficit is really out
Speaker 7: of control, and so far there have been very little
Speaker 7: other than talk, very little in the way of specific
Speaker 7: measures to curb the budget deficit. And if the US
Speaker 7: continues to have a big budget deficit, it's going to
Speaker 7: dig into and reduce the ability to provide money for
Speaker 7: our defense. We need a strong defense system.
Speaker 4: In a world of war. We're in a world of.
Speaker 7: Trade wars and we're in the world of actual wars,
Speaker 7: and we're going to need to have a strong defense
Speaker 7: capability and a strong industrial base to support our defense capability
Speaker 7: and put more money into defense technology, which is extremely important.
Speaker 7: Most wars in the future will be fought by drones,
Speaker 7: by effective data use, by effective intelligence, and the United
Speaker 7: States is going to have to be ahead of the
Speaker 7: game on intelligence, ahead of the game on these non
Speaker 7: manned military weapons, and that's going to be extremely important.
Speaker 7: And a much more coordinated battlefield with an Avy, the Army,
Speaker 7: the Air Force and others working together and data is
Speaker 7: what's going to enable them to coordinate better, which we need.
Speaker 5: Bob, what is your view of Russia at the moment?
Speaker 5: I mean, they've obviously got their hands tied in the Ukraine.
Speaker 5: How should this incoming administration deal with Russia over the
Speaker 5: next seven years? In mister Putin, over the next several years.
Speaker 7: First of all, I think the US has to continue
Speaker 7: to support Ukraine. I know it's going to be expensive.
Speaker 7: I know it's not as popular as it was. I
Speaker 7: know there are people in administration who don't want to
Speaker 7: do this, but a demonstration of weakness, of tentativeness, off
Speaker 7: fecklessness with respect to Ukraine will send signals all up
Speaker 7: and down. And finally we're getting you know, we talked
Speaker 7: about the Domino effect before, and the other way that
Speaker 7: George Tennant talked about Domo effect countries falling into the
Speaker 7: Russian orbit. Now they're falling away from the Russian orbit.
Speaker 7: All of its friends the Syria probably won't be able
Speaker 7: to use those bases. All the bets that made in
Speaker 7: the in the Gulf are probably going to go sour.
Speaker 7: And I suspect that we have to work. We have
Speaker 7: to talk to them, but I don't think they're as
Speaker 7: powerful as they were. But we also have to demonstrate
Speaker 7: that NATO is going to protect all the other countries
Speaker 7: in the region. The Estonia is a Latvia as Lithuanians,
Speaker 7: and make it very clear that we are part of
Speaker 7: the single most important part of de terrence, so the
Speaker 7: Russians don't do this again.
Speaker 3: You're the only one I can ask this question too.
Speaker 3: With immense respect for your service. We are one year
Speaker 3: on from the death of Henry Kissinger. What do you
Speaker 3: miss the most about working day to day with doctor Kissinger.
Speaker 7: I miss his good judgment. He understood the way the
Speaker 7: world works. He had a dialogue actually with Putin, with Shujinping,
Speaker 7: with the President Biden, and he did have one with Trump.
Speaker 7: I think Kissinger understood that you have to have effect
Speaker 7: of diplomacy. You have to have a steady diplomacy where
Speaker 7: you worked with other countries. You had to be seen
Speaker 7: to be reliable and predictable. Great powers cannot afford to
Speaker 7: be misunderstood by their allies or their friends, and he
Speaker 7: got that. And he also understood in your strong military
Speaker 7: to back up your diploma.
Speaker 6: I got to make some news today. Twenty seconds. Have
Speaker 6: you spoke to Secretary of State designate Marco Rubio?
Speaker 7: Now I have not recently. No, I've spoken to h
Speaker 7: when he was a senator, but I have not spoken
Speaker 7: since he's been picked.
Speaker 6: You can see hormance, so you know, young Hormontes could
Speaker 6: go down Staton Street. Amount take it. Robert Hormantz, brilliant.
Speaker 3: Thank you so much, of course, by chairman, a Kissinger associate.
Speaker 3: It's good to see you this holiday.
Speaker 2: This is the Bloomberg Surveillance Podcast. Listen live each weekday
Speaker 2: starting at seven am Eastern on applecar Play and Android
Speaker 2: Auto with the Bloomberg Business app. You can also watch
Speaker 2: us live every weekday on YouTube and always on the
Speaker 2: Bloomberg terminal.
Speaker 3: And I look at the front pages of Lisa Matteo
Speaker 3: moment here on Bloomberg Surveillance. Lisa, I didn't look at
Speaker 3: your list. But when the intern said, this is just
Speaker 3: really something good.
Speaker 8: But wait, newspapers is now a moment, not an hour?
Speaker 8: What is going?
Speaker 6: It's a moment, you know. I talk to your PR people.
Speaker 6: They want to market in this a moment. All right,
Speaker 6: we're reading.
Speaker 8: I have a new luxury destination and that you might
Speaker 8: want to check out. Okay, luxury travelers, they are heading
Speaker 8: to this. It's California Sores East Cape. It's about forty
Speaker 8: five miles northeast of Los Cabos, that big tourist area.
Speaker 8: So the East Cape, it's big for fishing, least traveled
Speaker 8: areas because people like it. It's secluded. Okay, but now
Speaker 8: you start to have these luxury resorts that are coming
Speaker 8: in back in twenty nineteen. Yeah, the four seasons they
Speaker 8: open their Cosas Palmas Resort, one hundred and eighteen rooms. Okay,
Speaker 8: you've got fine dining, golf course, but it comes with
Speaker 8: the price tag. Are you ready for it? Guys that
Speaker 8: you're gonna have to pay about one thousand dollars a night. Okay.
Speaker 8: That's where it starts at. And they have two more
Speaker 8: ultra luxury resorts coming summer offering residence. Yes, very very tippy.
Speaker 3: Way down like where people don't start directly west of
Speaker 3: maset Land across the Gulf of California.
Speaker 8: Yes, so if you don't like to deal with a
Speaker 8: lot of people in a big tourist attraction, this is
Speaker 8: the place where they're going.
Speaker 6: Kits On Sweeney's bucket li like that.
Speaker 8: It's sweety. You're going to flights already walking down to
Speaker 8: dangerous provisions.
Speaker 6: You're going to go to what's it called East Cape
Speaker 6: East Cape.
Speaker 8: Yes, and they're even having residences there. That starts for
Speaker 8: about seven hundred and fifty to one thousand dollars for
Speaker 8: a studio apartment. So okay, there you can. You can
Speaker 8: get into that too if you really want to stay.
Speaker 8: All right, I'm moving on to Tom Brady, Big Big
Speaker 8: souther Be's auction. Okay, the watches, the sports memorabilia, it
Speaker 8: all sold. There were about forty one lots for nine
Speaker 8: million dollars total.
Speaker 5: Okay, she's selling this stuff.
Speaker 2: Does he need cash?
Speaker 8: I can't s good question because this story doesn't get
Speaker 8: into those details.
Speaker 6: Said you're a little late.
Speaker 8: Yeah, exactly how many.
Speaker 7: Kids does he?
Speaker 8: Yeah, he's got a lot of kids. So here's a
Speaker 8: few of the standouts, so if you want to go
Speaker 8: sports memorbilia side. The top one was a football football
Speaker 8: he used to break the NFL all time passing yards record,
Speaker 8: but also a University of Michigan jersey that he wore
Speaker 8: during his final college game that was top dollar. And
Speaker 8: then you have, yes, the watches he has the price
Speaker 8: he watches the Rolex Daytona Paul Newman Paul John Player Special.
Speaker 8: Over a million dollars just for that one. It sounds
Speaker 8: a nice looking watch, but it's very nice looking watch.
Speaker 8: Or if you like the custom made Audomar p Gay
Speaker 8: Did I say that right? I hopefully I get Royal
Speaker 8: Oak watch. It's out of my price range seven hundred
Speaker 8: and twenty thousand dollars. He actually wore that during the
Speaker 8: Netflix roast her.
Speaker 3: I heard Tom Brady on Fox doing color announcing football
Speaker 3: four or five weeks ago. He was so bad I
Speaker 3: had to turn it off and I turned it on
Speaker 3: this weekend.
Speaker 6: And this is typical Brady. He was really, really quite good. Really,
Speaker 6: I think it's good.
Speaker 7: Now.
Speaker 5: The question I have is he can I continue doing this?
Speaker 5: Why would you want to work? It's maybe, I don't know.
Speaker 5: Check Now he's an owner, that's true. Now he's an
Speaker 5: owner of the Oak or the Las Vegas or so.
Speaker 6: I'm not sure she's an older of the Radars.
Speaker 8: Yeah, but see that's behind the scenes. You need to
Speaker 8: be in the spotlight. Relevant. That's what it's about nowadays.
Speaker 3: Okay, Well, thank you for that, Tom Brady. Moment, I'm
Speaker 3: moving them on Fox.
Speaker 8: Okay, asked In Martin. They're actually a better late than never. Okay,
Speaker 8: they're making their first plug in hybrid supercar. You have
Speaker 8: to check this out in the Bloomberg terminal. Yeah, the
Speaker 8: Valhalla finally hitting production in twenty twenty five. It's about
Speaker 8: four years behind schedule. One thousand and sixty four horse power,
Speaker 8: top speed t hudge and seventeen miles per hour. Only
Speaker 8: nine hundred and ninety nine will be made, so you
Speaker 8: got to act fast. The price wasn't said, but it's
Speaker 8: expected to cost more than seven hundred and sixty six
Speaker 8: thousand dollars. But you know the company has been struggling. Yeah,
Speaker 8: we'll speaking again up into this. Got to get into
Speaker 8: that and ride it around the courtyard?
Speaker 6: Can I say in that one? Right now?
Speaker 3: I mean, right now as we speak, Sergio Perez of
Speaker 3: Mexico there's this raging battle over what he's going to
Speaker 3: do with Red Bull. I mean, all these people, including
Speaker 3: at Aston Martin, are up in the air. It's like
Speaker 3: it's like Max Freed on steroids.
Speaker 6: That's how I put it.
Speaker 8: So check it out.
Speaker 5: I mean, you know, Hannah Elliott at Bloomberg she works
Speaker 5: in pursuits. All she does is travel the globe and
Speaker 5: drive these amazing cars all over the world. And then
Speaker 5: she has a podcast with Matt Miller and they talk
Speaker 5: about cars.
Speaker 8: That's not a bad gig.
Speaker 5: That's not a bad gig. So I'm sure she will
Speaker 5: be behind that. I don't know.
Speaker 6: I don't know.
Speaker 5: Matt Miller had a Eliot check out that podcast because
Speaker 5: if you like cars, that's the one to go to.
Speaker 6: I think I've never forgiven Pharaoh.
Speaker 3: He got me into this Formula one thing and I
Speaker 3: actually like, I'm addicted to it.
Speaker 6: And they have the Otomist watch that you talked about.
Speaker 6: They sponsor it.
Speaker 3: You know, it's it's like, you know, men walking around
Speaker 3: with million dollar watches in their wrist, the kind of thing.
Speaker 8: Yeah, one more last one. I'll do this one quick.
Speaker 6: Okay.
Speaker 8: It's a new trend in gift giving because the holiday
Speaker 8: season is here. Instead of buying gifts, where people are
Speaker 8: doing is that they're ordering a mix of mixed mystery boxes.
Speaker 8: They're unopened, unclean mail. Where they're getting at it's not
Speaker 8: the post office. So these big box retailers who can't
Speaker 8: figure out and they get things returned and they have
Speaker 8: all these packages. They actually hire third party companies to
Speaker 8: come in and take care of the mess.
Speaker 6: Hikay.
Speaker 3: So those companies at the Mateo at the Mateale Christmas
Speaker 3: this year, come on Costco.
Speaker 6: It's you can get a big box from Costco with.
Speaker 8: No no because then you know what it is. But
Speaker 8: these are like unopened things, so you hand it to
Speaker 8: somebody and you're just waiting anticipation, like what's it going
Speaker 8: to be? What's it going to be? Sometimes it's it
Speaker 8: could be a little bit, you know, embarrassing because some
Speaker 8: of the things you don't know what they are. But
Speaker 8: this is a new thing. It's the whole element of surprise.
Speaker 5: I didn't know that was the thing.
Speaker 8: It's apparently thing. It started during the pandemic because people
Speaker 8: were bored and these companies had packages to get rid of.
Speaker 6: All right, Lisa Matteo, the newspapers, thank you.
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