WEBVTT - Investors Are Starting To Look At Argentinian Assets 0:00:05.800 --> 0:00:08.720 Welcome to the Bloomberg p m L Podcast. I'm pim Fox. 0:00:08.760 --> 0:00:11.520 Along with my co host Lisa Bramowitz. Each day we 0:00:11.640 --> 0:00:15.120 bring you the most important, noteworthy, and useful interviews for 0:00:15.200 --> 0:00:17.840 you and your money, whether you're at the grocery store 0:00:17.960 --> 0:00:20.720 or the trading floor. Find the Bloomberg p m L 0:00:20.840 --> 0:00:33.559 Podcast on Apple Podcasts, SoundCloud, and Bloomberg dot com. Well, 0:00:33.640 --> 0:00:36.040 markets in general are pretty calm, at least if you 0:00:36.240 --> 0:00:39.280 look at the United States. Look elsewhere, not so much. 0:00:39.280 --> 0:00:42.600 In particular, I'm talking about Argentina, which today asked the 0:00:42.640 --> 0:00:46.120 i m F the International Monetary Funds to expedite and 0:00:46.200 --> 0:00:49.920 already agreed upon credit line the payments of fifty billion 0:00:49.960 --> 0:00:54.120 dollars still out there. Joining us now to talk about 0:00:54.440 --> 0:00:57.880 emerging markets and specifically some of the troubled child children 0:00:57.960 --> 0:01:01.560 within them. Damien Sassaur, chief Merging markets credit strategist here 0:01:01.600 --> 0:01:05.440 at Bloomberg Intelligence. Damien, what do you make of Argentina 0:01:05.520 --> 0:01:09.640 at this point, basically asking for help with their currency 0:01:09.720 --> 0:01:12.440 falling to a record low versus the dollar. Yeah, well, 0:01:12.440 --> 0:01:14.880 I mean Argentina has been trading heavy for a very 0:01:15.080 --> 0:01:18.160 long time now, I mean technicals have improved, but again 0:01:18.240 --> 0:01:20.360 I'm not convinced it's all clean positioning here. I mean 0:01:20.360 --> 0:01:23.800 it's fundamentals remain very very weak, declining GDP. I mean, 0:01:23.800 --> 0:01:25.680 it's going to enter its second recession in as many 0:01:25.720 --> 0:01:29.000 years this year. Rising interest rates, I mean interest rates 0:01:29.040 --> 0:01:31.119 have literally doubled. I mean, I think dollar interest rates 0:01:31.120 --> 0:01:34.560 in Argentina now are are hovering around ten percent. Uh, 0:01:34.640 --> 0:01:37.560 you're in the high if you look at local currency rates. 0:01:37.600 --> 0:01:40.720 So yeah, No, I mean rising inflation week externals, there's 0:01:40.720 --> 0:01:44.200 a lot not to like about Argentina. But interestingly enough, 0:01:44.280 --> 0:01:47.720 the past forty eight hours, I've received some interesting calls 0:01:47.880 --> 0:01:52.120 from investors, particularly advent riven investors, who are actually looking 0:01:52.160 --> 0:01:54.920 at current levels and perhaps looking to get involved, which 0:01:54.960 --> 0:01:58.840 may be a sign that you know, things might change. Uh. 0:01:58.960 --> 0:02:03.760 The reason I is because wait a minute, when when 0:02:04.920 --> 0:02:07.320 when this election took place? When when we got the 0:02:07.360 --> 0:02:13.400 new president mackri I remember distinctly people beating the drums 0:02:13.400 --> 0:02:16.720 saying this is different. You've got to get in. Argentina 0:02:16.960 --> 0:02:19.919 is going to be the best place to invest money. 0:02:20.480 --> 0:02:23.079 Oh come on, well, I mean you're right, Pim. I mean, look, 0:02:23.120 --> 0:02:25.640 I mean if you look at going into March of 0:02:25.680 --> 0:02:28.480 this year, when Iam sort of melted down. It was 0:02:28.600 --> 0:02:32.480 the largest overweight in emerging markets according to JP Morgan's 0:02:32.480 --> 0:02:35.880 Positioning survey. Right, so people were definitely long and wrong. 0:02:36.280 --> 0:02:38.040 And I think you're aut. You make a very good point. 0:02:38.080 --> 0:02:40.280 You know, people who held on on the way down 0:02:40.360 --> 0:02:42.560 in the last few months, it's gonna be very difficult 0:02:42.600 --> 0:02:44.840 for them to reload at current levels. Well, I'm just 0:02:44.880 --> 0:02:47.720 talking about credibility. Well, yeah, right, what credibility do they 0:02:47.760 --> 0:02:50.240 have when they are dealing with the second recession in 0:02:50.280 --> 0:02:52.840 two years and having defaulted what five times in the 0:02:52.880 --> 0:02:55.600 past century. I would I would argue the other thing. 0:02:55.600 --> 0:02:57.440 I would say, they've they've made quite a bit of 0:02:57.440 --> 0:03:00.160 progress in structural reforms. They've liberalized their effects rate, they've 0:03:00.200 --> 0:03:03.040 reduced export duties, they've cut fuel subsidies. I mean, they've 0:03:03.040 --> 0:03:05.520 re established times with global capital markets after being in 0:03:05.560 --> 0:03:08.760 the black for ten years. But um, but you're absolutely right. 0:03:08.840 --> 0:03:12.320 You know they want fifty billion dollars from the International 0:03:12.400 --> 0:03:16.079 Monetary Fund. Well, I mean, look, the government. If I think, 0:03:16.120 --> 0:03:17.959 I think the government would be better served if it 0:03:18.120 --> 0:03:22.760 put disinflation efforts aside, engineered a controlled real depreciation of 0:03:22.800 --> 0:03:26.079 the PAS. So with the attention of again, boosting external competitiveness, 0:03:26.120 --> 0:03:29.440 attracting FDI and and reducing the fiscal deficit. And I 0:03:29.480 --> 0:03:31.640 think that fifty billion I m F line goes a 0:03:31.680 --> 0:03:34.200 long way to giving them the support they need and 0:03:34.240 --> 0:03:36.800 the credibility they need to put through, you know, to 0:03:36.960 --> 0:03:39.520 to actually do that. Unlike Turkey, right, I mean, Turkey, 0:03:39.880 --> 0:03:41.640 you know, has shown the I m F. They've shunned 0:03:41.640 --> 0:03:44.000 their Western investors. You know, Argentina has taken a very 0:03:44.000 --> 0:03:46.520 different tack. And yet Argentina five year CDs is trading 0:03:46.560 --> 0:03:49.200 above six hundred basis points in Turkeys only at what 0:03:49.400 --> 0:03:52.440 four hundred and eighty? So where's the disconnect their? Right? 0:03:52.440 --> 0:03:54.560 I mean, I would make the case that perhaps Argentina 0:03:55.000 --> 0:03:58.280 looks relatively attractive at current levels. Interesting I think that 0:03:58.600 --> 0:04:00.640 right now I want to add not a little bit 0:04:00.680 --> 0:04:04.320 Argentina as an adysentcratic story for sure. Uh Turkey as well, 0:04:04.640 --> 0:04:07.800 both of them seeing distress. But at a time when 0:04:07.800 --> 0:04:11.360 a number of pretty big asset managers have gotten burned 0:04:11.560 --> 0:04:17.280 very badly based on Argentinean and Turkish sell offs of assets, 0:04:17.680 --> 0:04:20.320 you have to wonder is this going to lead to 0:04:20.520 --> 0:04:24.359 a broader risk off in e m just because burned once, 0:04:24.400 --> 0:04:27.320 burned twice? How many times can these people get burned 0:04:27.360 --> 0:04:29.320 before they just say, forget it, I'm going to cast 0:04:29.480 --> 0:04:31.160 You know, I don't want to play this time in 0:04:31.200 --> 0:04:33.760 a different story with Argentina because you know, we've lived 0:04:33.760 --> 0:04:35.840 through Argentina. I mean, we um guys that live through 0:04:35.880 --> 0:04:38.279 Argentina for the better part of our careers. But you know, 0:04:38.279 --> 0:04:41.200 while the pacers plunged and rates have searched, um. You know, 0:04:41.240 --> 0:04:44.359 thus far, Argentine's remain quite confident in their banking system. 0:04:44.400 --> 0:04:46.640 They have not withdrawn deposits as they have in Latin 0:04:46.800 --> 0:04:49.200 in previous crisis. Is like we're seeing in other places 0:04:49.240 --> 0:04:51.760 like Turkey and and and look, I mean cross border 0:04:51.800 --> 0:04:55.000 market funding and liquid assets remain ample in both dollars 0:04:55.000 --> 0:04:57.919 and pacias in Argentina, So the banking system remains, you know, 0:04:57.960 --> 0:05:03.360 relatively healthy. So you don't contagion either within Argentina or 0:05:03.480 --> 0:05:06.800 more broadly in emerging markets. I think I think Turkey 0:05:06.800 --> 0:05:09.800 and Argentina have Look, they're a very small part of 0:05:09.800 --> 0:05:12.200 the emerging markets, you know, and so far, yeah, we've 0:05:12.200 --> 0:05:15.240 been relatively I guess fortunate that we haven't seen contagion. 0:05:15.560 --> 0:05:18.000 It's not China it's not you know, it's not even 0:05:18.040 --> 0:05:21.400 brazila Russia. Um. But you know, I I take your point. 0:05:21.440 --> 0:05:23.920 You know, as things, you know, get worse and look, 0:05:23.960 --> 0:05:27.320 performances and perception is reality. So long as performance remains 0:05:27.800 --> 0:05:31.200 you know, low and poor. Um. You know, you know 0:05:31.760 --> 0:05:34.039 this will eventually slip into the real economy. You know. 0:05:34.080 --> 0:05:36.400 The longer that you know these economies failed to perform, 0:05:36.480 --> 0:05:38.279 the longer that they you know, they are mired in 0:05:38.279 --> 0:05:40.560 this weakness, you know, things are going to get more 0:05:40.560 --> 0:05:43.359 and more challenging and and so you're right from that perspective, 0:05:43.360 --> 0:05:45.880 but we're not quite there yet. UM. I still think 0:05:45.920 --> 0:05:48.680 that you know, Argentina, you know, can can manage their 0:05:48.720 --> 0:05:51.440 way out of this. Turkey is a different story. But Argentina, 0:05:51.600 --> 0:05:53.480 you know, I I think at current levels, it's starting 0:05:53.480 --> 0:05:55.680 to look a little bit of attractive. I sense a 0:05:55.760 --> 0:05:59.160 trip to Buenos airis in the future for Damian Sasaur. 0:05:59.440 --> 0:06:02.720 You never know, Damian Sassaura, thank you very much, Chief 0:06:02.839 --> 0:06:07.600 Emerging markets credit strategist for Bloomberg Intelligence, giving us the 0:06:07.640 --> 0:06:27.800 lowdown on investing in emerging markets. Canada's Foreign Affairs and 0:06:27.839 --> 0:06:32.279 Minister Christopher Freelan is meeting in Washington, d C with 0:06:32.360 --> 0:06:35.560 her US counterparts. This comes a day after US President 0:06:35.560 --> 0:06:40.320 Donald Trump announced a deal with Mexico on trade, and 0:06:40.400 --> 0:06:45.920 of course Canada was absent from those US Mexican discussions. 0:06:46.279 --> 0:06:50.320 Here to tell us more about this three way complicated 0:06:50.320 --> 0:06:54.400 trade agreement is Antonio Ortiz Mayna. He is a senior 0:06:54.520 --> 0:06:58.279 vice president for Albright stone Bridge Group a s G. Formerly, 0:06:58.640 --> 0:07:01.960 he served for eight years as head of Economics Affairs 0:07:02.080 --> 0:07:04.520 at the Embassy of Mexico in the United States, where 0:07:04.520 --> 0:07:08.000 he advised US companies with a presence in Mexico as 0:07:08.000 --> 0:07:14.000 well as Mexican companies doing business in the United States. Ambassador, 0:07:14.080 --> 0:07:16.600 thank you very much for being with us. Can you 0:07:16.760 --> 0:07:22.400 tell us what is so terrible about if indeed that 0:07:22.520 --> 0:07:26.480 is so Canada not being part of the negotiations between 0:07:26.480 --> 0:07:29.080 the United States and Mexico, And then why would Mexico 0:07:29.240 --> 0:07:32.960 have those negotiations solely with the US if indeed having 0:07:33.000 --> 0:07:36.960 Canada there was so important. Yes, thank you for the 0:07:37.360 --> 0:07:41.840 invitation and glad to share my views on that. First 0:07:41.880 --> 0:07:45.160 of all, I would say that even though Canada was 0:07:45.280 --> 0:07:49.520 not at the table over the past two months, let's say, 0:07:49.560 --> 0:07:53.480 after the G seven summit in Canada, where there was 0:07:53.520 --> 0:07:58.080 a fallout between Canada and the US. Canada was in 0:07:58.120 --> 0:08:01.920 a way of participating in the negotiations above all, with 0:08:02.080 --> 0:08:07.040 great consultations between Mexico and Canada, and Mexico was dealing 0:08:07.080 --> 0:08:10.840 with the US on some pretty contentious issues, I would say, 0:08:10.920 --> 0:08:15.000 chief among them the automobile rules of origin, and was 0:08:15.120 --> 0:08:18.440 that was settled. It was pretty easy for Canada to 0:08:18.560 --> 0:08:21.560 buy into that and then to deal with issues that 0:08:21.640 --> 0:08:26.400 are more three way challenges rather than bilateral issues. So 0:08:26.440 --> 0:08:29.600 that's where we stand. But the clock is sticking from 0:08:29.600 --> 0:08:33.080 now until of Friday, and I don't know what will happen. 0:08:34.160 --> 0:08:37.199 Has a lot changed really between the US and Mexico. 0:08:37.240 --> 0:08:39.360 I mean, is this deal likely to stick and is 0:08:39.360 --> 0:08:45.120 it really that different? Um, well, there there are open questions. 0:08:45.400 --> 0:08:49.160 First of all, will it be bilateral or trilateral? We 0:08:49.200 --> 0:08:52.760 will now buy Friday. And this is not trivial because 0:08:52.920 --> 0:08:57.720 under U s Trade Promotion Authority, the Congress delegated authority 0:08:57.760 --> 0:09:02.520 to US negotiators to update NAFTA, to modernize NAFTA, not 0:09:02.679 --> 0:09:06.560 to do a bilateral deal with Mexico or even another 0:09:06.600 --> 0:09:10.200 bilateral deal with Canada. Some so, some members of the 0:09:10.240 --> 0:09:15.040 House and Senate are questioning whether uh USDR has authority 0:09:15.120 --> 0:09:18.760 to submit a bilateral deal with Mexico. That's on a 0:09:18.840 --> 0:09:22.439 sort of a legal technical perspective, but even more importantly, 0:09:23.240 --> 0:09:26.720 from a substantial perspective, I don't think it would be 0:09:27.160 --> 0:09:29.960 a good idea to have a bilateral agreement. I think 0:09:30.280 --> 0:09:35.199 a trilateral agreement is much more significant from an economic perspective. 0:09:35.960 --> 0:09:40.319 So why did you believe Mexico entered into this bilateral negotiation. 0:09:42.000 --> 0:09:47.720 I think that Mexico wanted to accelerate negotiations as as 0:09:47.840 --> 0:09:50.800 much as possible to see if they could sign the 0:09:50.920 --> 0:09:55.760 agreement with the current government that will end on December one, 0:09:56.360 --> 0:09:59.000 and to do that they had to advance on a 0:09:59.120 --> 0:10:02.800 number of bilater role issues with the US, and as 0:10:02.840 --> 0:10:06.520 I mentioned, the main one was over all the rules 0:10:06.520 --> 0:10:09.400 of origin. So once they got that of out of 0:10:09.440 --> 0:10:14.520 the way, it was easier to accelerate negotiations. Our guest 0:10:14.720 --> 0:10:18.080 is Dr Antonio ortiz Amina. He is the senior vice 0:10:18.080 --> 0:10:21.800 president at albright Stone Bridge Group, previously serving as the 0:10:21.840 --> 0:10:26.600 head of Economic Affairs at the Embassy of Mexico. And 0:10:26.720 --> 0:10:32.360 nothing surprising their Doctor Ortismina from the Foreign Minister of 0:10:32.400 --> 0:10:35.360 Canada that they're having good negotiations. But what could have 0:10:35.440 --> 0:10:37.680 changed in such a brief amount of time. Is it 0:10:37.760 --> 0:10:40.160 that Canada realizes that the clock is taking in at 0:10:40.160 --> 0:10:42.440 the United States and Mexico or will go their own 0:10:42.440 --> 0:10:46.880 way with or without Canada. Well, a couple of things 0:10:46.960 --> 0:10:50.360 have happened. First the agreement on autos, which is critically 0:10:50.400 --> 0:10:55.480 important for Canada. Secondly, UH an important agreement on the 0:10:55.520 --> 0:10:59.200 sunset class. So the sunset class was an absolute deal 0:10:59.280 --> 0:11:03.960 breaker UH for both Mexico Canada. So with those two 0:11:04.080 --> 0:11:08.000 big items out of the way, I think Canada can 0:11:08.040 --> 0:11:12.359 now deal with some bilateral issues, above all supply management 0:11:12.480 --> 0:11:17.160 in their dairy industry, and then to deal with something 0:11:17.200 --> 0:11:20.079 that I think will be very complicated, and that's NAPTER 0:11:20.200 --> 0:11:25.679 chapter nineteen, which deals with unfair trade practices, dumping and subsidies. 0:11:25.720 --> 0:11:29.280 It is my understanding that Mexico on the US reached 0:11:29.320 --> 0:11:33.080 an agreement to do away with NAPTA chapter nineteen, and 0:11:33.160 --> 0:11:37.440 chapter nineteen is very important for Canada, but substantively over 0:11:37.520 --> 0:11:42.320 the endless software lumber dispute and politically so they will 0:11:42.400 --> 0:11:46.040 have to see how they can resolve that. So one 0:11:46.080 --> 0:11:48.640 thing that I'm struck by here is that President Trump 0:11:48.679 --> 0:11:52.880 is negotiating directly with Canada and with Mexico. But Congress 0:11:52.960 --> 0:11:56.360 isn't necessarily on board. So how much cloud does President 0:11:56.360 --> 0:12:00.280 Trump have in these renegotiations when Congress ultimately has to 0:12:00.280 --> 0:12:02.400 sign off and it's unclear how connected they are to 0:12:02.760 --> 0:12:06.920 to this whole process. Absolutely, they are different negotiations going 0:12:06.960 --> 0:12:12.320 on right now. So it's US Canada trade negotiations finalizing 0:12:12.400 --> 0:12:17.559 Mexico U S trade negotiations, and that trilateral negotiations, and then, uh, 0:12:17.640 --> 0:12:21.199 the executive will have to make sure that Congress accepts 0:12:21.240 --> 0:12:25.319 whatever they submit. And it is not a foregone conclusion 0:12:25.440 --> 0:12:29.520 that the Congress will accept a bilateral deal because the 0:12:29.559 --> 0:12:35.280 authority was granted to do a trilateral deal. Right. Well, yeah, 0:12:35.360 --> 0:12:37.200 but those are the legal issues that you that you 0:12:37.240 --> 0:12:43.400 mentioned previously. Now you mentioned Mexico's domestic political situation wanting 0:12:43.400 --> 0:12:45.880 to get a deal done before the new administration of 0:12:46.600 --> 0:12:52.200 Loprez Lopez Oprador takes office. Canada is also facing an election, 0:12:52.200 --> 0:12:55.679 and then we have the US mid term elections in November. 0:12:56.320 --> 0:13:01.120 Do you believe that politics is currently driving the negotiations. Yes, 0:13:01.160 --> 0:13:04.680 I do believe that politics are are to great extin 0:13:04.840 --> 0:13:08.960 driving the negotiation. And my view is that it might 0:13:09.040 --> 0:13:12.839 be more US politics rather than Mexican politics. And let 0:13:12.880 --> 0:13:18.840 me explain why. So, the upcoming Lopezo ad Or administration 0:13:18.960 --> 0:13:22.200 wants to get the NAFTA issue out of the way 0:13:22.280 --> 0:13:27.839 to focus on other domestic politics issues and additional very 0:13:27.880 --> 0:13:32.720 complicated by lateral issues with the US, including undocumented migration, 0:13:32.840 --> 0:13:35.760 cooperation and security, et cetera. So it's more of an 0:13:35.800 --> 0:13:38.640 idea that they want to close this chapter and move 0:13:38.679 --> 0:13:41.800 on to other things, rather than there being a risk 0:13:42.320 --> 0:13:46.280 that the next Mexican Congress would not ratify a new 0:13:46.400 --> 0:13:49.600 NAFTA agreement. So that is my view in terms of 0:13:49.640 --> 0:13:53.800 the Mexican politics. The US politics, I think are more 0:13:53.960 --> 0:13:58.960 complicated because the calculation by us DR has to do 0:13:59.200 --> 0:14:02.200 with the current Congress and what could be ratified by 0:14:02.280 --> 0:14:06.240 the current House and Senate. If they wait until they have, 0:14:06.600 --> 0:14:09.600 you know, the a new Senate next year, then the 0:14:09.679 --> 0:14:13.880 political calculus might change and what could have been acceptable 0:14:14.320 --> 0:14:17.319 for you know, the current Congress in terms of the 0:14:17.360 --> 0:14:22.080 Mexican concessions might not be acceptable later on. So I 0:14:22.080 --> 0:14:25.960 do have say more questions about the effect of US 0:14:26.080 --> 0:14:31.120 domestic politics on the negotiations and ratification than I do 0:14:31.200 --> 0:14:34.680 about Mexican politics. Even though there will be a change 0:14:34.720 --> 0:14:38.240 in government in Mexico. This is really compellingentis it suggests 0:14:38.280 --> 0:14:41.160 to me that everyone's going to try to expedite this 0:14:41.680 --> 0:14:45.200 through the process very quickly in order to avoid any 0:14:45.240 --> 0:14:48.600 kind of political turmoil. That that is correct, But I'm 0:14:48.640 --> 0:14:55.240 not concerned about US political turmoil than Mexican political turmoil. Yeah, 0:14:55.440 --> 0:14:57.840 Antonio Ortiz at Manna, thank you so much for being 0:14:57.960 --> 0:15:00.840 with us. Antonio Ortiz at Manna, see your vice president 0:15:00.880 --> 0:15:03.400 of the all Bright stone Bridge Group. He's also the 0:15:03.400 --> 0:15:07.080 former head of economic affairs at the Embassy of Mexico 0:15:07.240 --> 0:15:26.239 in the United States, joining us now Alex Wayne Bloomberg 0:15:26.280 --> 0:15:31.040 White House team Leader Alex. Interestingly, in response to this announcement, 0:15:31.440 --> 0:15:35.040 Io S Senator Chuck Grassley, a Republican, tweeted out that 0:15:35.120 --> 0:15:37.280 he hopes that is not the case, that this is 0:15:37.320 --> 0:15:41.040 not true, and he tweeted this to President Trump, Alex, 0:15:41.200 --> 0:15:43.240 what are we to make of all of this? So 0:15:43.480 --> 0:15:48.600 arguably the president's biggest achievement has been getting judicial nominees 0:15:48.880 --> 0:15:52.160 appointed to positions in the federal court system. He's gotten 0:15:52.600 --> 0:15:56.400 uh sixty appointments to the court system already, including appeals 0:15:56.400 --> 0:16:00.520 Court judges and a Supreme Court justice with more on 0:16:00.600 --> 0:16:04.880 the way. Probably, so the Senate Judiciary Committee Chairman, Chuck 0:16:04.880 --> 0:16:07.200 Grassley is the guy who has moved all those appointments 0:16:07.200 --> 0:16:09.680 through the process. He's worked closely with McGann. Megan gets 0:16:09.680 --> 0:16:12.400 a lot of credits on the right among conservatives and 0:16:12.520 --> 0:16:16.040 among Republican members of Congress for shepherding all these judicial appointments. 0:16:16.560 --> 0:16:19.280 And so I think that is what Grassley is concerned about, 0:16:19.320 --> 0:16:22.440 that if there is turmoil in the White House Counsel's 0:16:22.600 --> 0:16:27.200 position that the steady flow of judicial appointments may may 0:16:27.360 --> 0:16:29.480 may get a little a little bumpy. Can you give 0:16:29.520 --> 0:16:31.360 us a sense of the background to this. I mean, 0:16:31.400 --> 0:16:34.800 Don McGann is not President Trump's personal lawyer and has 0:16:34.840 --> 0:16:37.080 said he was not aware of some of the payments 0:16:37.160 --> 0:16:41.800 that were made to people to not talk about. So 0:16:42.360 --> 0:16:44.760 is that related to his decision to leave or has 0:16:44.800 --> 0:16:46.720 this been in the works for a while now? What 0:16:46.720 --> 0:16:50.560 what McGann is is involved in his UH Special Counsel 0:16:50.680 --> 0:16:54.560 Robert Mueller's investigations. He has taught extensively with the Special 0:16:54.560 --> 0:16:58.720 Counsel UH, essentially because the President gave him the green 0:16:58.800 --> 0:17:01.680 light to do so. And so McGann that the White 0:17:01.720 --> 0:17:05.439 House never expressed privilege over McGann to to limit what 0:17:05.480 --> 0:17:08.040 he said to the Special Counsel, So he's He's believed 0:17:08.040 --> 0:17:11.879 to have told Bob Mueller's folks a lot about how 0:17:12.119 --> 0:17:15.360 the early days of the White House worked, the firing 0:17:15.480 --> 0:17:19.399 of James Comey, UM, the Trump's decision making process with 0:17:19.480 --> 0:17:22.880 regard to Michael Flynn as former National Security advisor, all 0:17:22.880 --> 0:17:25.760 of those things Don McGann was very involved with and 0:17:25.880 --> 0:17:29.360 uh and has has spoken on the Special Council about UM. 0:17:29.440 --> 0:17:33.240 He and Trump have also reportedly budded heads over sort 0:17:33.240 --> 0:17:36.360 of the limits of presidential power. Trump is, I think, 0:17:36.400 --> 0:17:38.600 asked McGann to do things and McGann has had to 0:17:38.600 --> 0:17:41.560 tell him no, and that's made the President a little 0:17:41.600 --> 0:17:46.199 unhappy with him. Alex Washington is a political town. Is 0:17:46.280 --> 0:17:52.280 this a firing or a resignation something in between? I think, um, 0:17:52.320 --> 0:17:56.440 it's uh. We we don't know whether mcgannny this is coming. 0:17:56.520 --> 0:17:59.080 There was a report at Axioist this morning, uh, tip 0:17:59.119 --> 0:18:01.959 of the hat to them that said McGann was preparing 0:18:02.000 --> 0:18:05.159 to leave either after Brett Kavanaugh was confirmed to the 0:18:05.160 --> 0:18:09.480 Supreme Court or after the midterm elections. In November. But um, 0:18:11.000 --> 0:18:13.560 the President seems to have sort of quickened the pace 0:18:13.600 --> 0:18:16.200 on that departure a little bit with the tweet today. 0:18:16.320 --> 0:18:19.480 Uh So it's, UM, I don't know, it's it's sort 0:18:19.520 --> 0:18:22.320 of like a slow motion of firing or something. I'm 0:18:22.359 --> 0:18:24.880 not exactly sure. What is the role of the White 0:18:24.920 --> 0:18:27.680 House Council. What does the White House Council do? The 0:18:27.680 --> 0:18:31.080 White House Council defends the White House and the Office 0:18:31.080 --> 0:18:34.040 of the Presidency, uh and represents the White House in 0:18:34.080 --> 0:18:37.200 the Office of the Presidency in legal matters. The White 0:18:37.200 --> 0:18:39.960 House Council does not represent the President. That was apparently 0:18:40.000 --> 0:18:43.720 a misunderstanding that Donald Trump had upon entering the White House. 0:18:43.760 --> 0:18:46.800 He wanted. One thing we've we've seen reported is that 0:18:46.840 --> 0:18:49.800 he sort of thought that Don mgan was his personal attorney. 0:18:49.800 --> 0:18:52.600 And that's that's not what the White House Council does. 0:18:52.640 --> 0:18:57.240 And go ahead, going forward, who's likely to replace Don 0:18:57.440 --> 0:19:01.280 And does this expedited potential firing a Jeff Jeff Sessions 0:19:01.280 --> 0:19:05.560 that some people have been suggesting this morning. Uh, don't 0:19:05.680 --> 0:19:07.800 know that it has anything to do with Jeff Sessions. 0:19:07.840 --> 0:19:11.480 But the guy that is regarded as probably the likely 0:19:11.520 --> 0:19:14.400 successor to McGann isn't as a lawyer named Emmett Flood. 0:19:14.640 --> 0:19:18.320 He was hired earlier this year to replace Ty Cobb, 0:19:18.359 --> 0:19:21.479 who had been dealing with UH with Mueller. So Emmett 0:19:21.480 --> 0:19:25.280 Flood is now the the special counsel, the guy dealing 0:19:25.320 --> 0:19:30.800 with the special counsel investigation. He also handled UH investigations 0:19:30.840 --> 0:19:34.360 in the Clinton White House. Interestingly, UM, so he's he's 0:19:34.400 --> 0:19:36.879 not really a partisan guy and at Flood he's just 0:19:37.160 --> 0:19:40.879 a guy who strongly believes in the independence of the 0:19:41.280 --> 0:19:44.120 of the White House and in defending the president whoever 0:19:44.160 --> 0:19:49.520 it is um from investigations both by by by Counsel 0:19:49.600 --> 0:19:52.879 and the and the Justice Freman or by Congress. And 0:19:52.960 --> 0:19:56.720 this would require no approval process. Is that correct? Right? 0:19:56.880 --> 0:19:59.560 Especially the the White House Counsel is not a Senate 0:19:59.560 --> 0:20:02.000 confirmed edition. It's not. It's not a count of position. 0:20:02.040 --> 0:20:05.840 It's entirely up to the president. As far as Emmett 0:20:05.840 --> 0:20:09.639 Flood is concerned, he's got experience, as you said, in 0:20:09.640 --> 0:20:15.760 a variety of administrations. What would be his role in 0:20:16.119 --> 0:20:20.760 disappointment of judges and in the general role of being 0:20:20.960 --> 0:20:25.760 a White House counsel. I remember that he was representing 0:20:26.119 --> 0:20:29.480 at the time Vice President Dick Cheney. Uh in the 0:20:29.560 --> 0:20:34.920 lawsuit that was filed by Valerie Plaie I believe about 0:20:34.920 --> 0:20:38.399 the Plame affair about the right. So conventional wisdom is 0:20:38.440 --> 0:20:40.119 that Democrats are going to take the House in the 0:20:40.160 --> 0:20:43.280 midterm elections. And if that happens, UH, the White House 0:20:43.280 --> 0:20:49.080 can expect a flood of congressional investigations. Uh. Every subcommittee 0:20:49.200 --> 0:20:52.639 in the House with investigation investigatory powers is going to 0:20:52.640 --> 0:20:57.160 be probing one scandal or another within the Trump administration. 0:20:57.200 --> 0:20:59.600 And so Emmett Flood will be the guy if he 0:20:59.800 --> 0:21:01.560 if he assumes the job, he will be the guy 0:21:01.600 --> 0:21:04.280 who has to respond to all these investigations and fight 0:21:04.320 --> 0:21:06.760 back against them. Alex, if we could just take a 0:21:06.800 --> 0:21:09.920 step back and talk about the turnover that we've seen 0:21:10.000 --> 0:21:13.200 so far in the White House and try to draw 0:21:13.600 --> 0:21:17.040 some sort of implication from it. Is this pretty typical 0:21:17.400 --> 0:21:21.480 or is this a sign of something else? But if 0:21:21.480 --> 0:21:23.520 it's not typical, then then what can we draw from it? 0:21:23.560 --> 0:21:26.720 Is it just that President Trump is known for high 0:21:26.800 --> 0:21:30.320 turnover just generally, and this is his style? Is this 0:21:31.280 --> 0:21:33.200 good guy to work for the President is a difficult 0:21:33.200 --> 0:21:35.119 person to work for? And this is a very tumultuous 0:21:35.119 --> 0:21:37.840 White House. There has been a lot, a lot of turnover, 0:21:37.920 --> 0:21:41.040 more turnover than any previous presidency than anybody's ever looked 0:21:41.080 --> 0:21:45.680 closely at Brookings Institute has has good numbers on that um. 0:21:45.760 --> 0:21:47.920 And that's all because of the kind of guy Donald 0:21:47.960 --> 0:21:52.600 Trump is. Uh. He demands loyalty from his subordinates. Uh, 0:21:52.640 --> 0:21:55.560 he doesn't tend to show them much loyalty himself, and 0:21:55.640 --> 0:21:58.280 so a lot of people come in and out. I 0:21:58.320 --> 0:22:00.359 want to thank you very much for joining us, alex 0:22:00.400 --> 0:22:04.040 Wayne of Bloomberg sharing some insight into what's going on 0:22:04.119 --> 0:22:07.280 in the White House. Of course, Don McGan the announcement 0:22:07.359 --> 0:22:10.439 from President Donald Trump that he will be leaving his 0:22:10.560 --> 0:22:15.240 position as the White House Counsel uh sometime in the fall, 0:22:16.000 --> 0:22:19.399 based on the tweet from the President to speaking about 0:22:20.200 --> 0:22:25.119 also the appointment of Brett Kavanaugh to the US Supreme Court. 0:22:25.160 --> 0:22:41.920 Our thanks to alex Wayne joining us down to tell 0:22:41.960 --> 0:22:44.720 us all about the world of video gaming. Is Ted Pollock. 0:22:44.800 --> 0:22:47.639 He is a video game technology analyst and the co 0:22:47.880 --> 0:22:52.240 founder of The Gamer E t F G a m 0:22:52.440 --> 0:22:54.560 R E t F. Ted Pollock, thanks very much for 0:22:54.600 --> 0:22:57.119 being here. How old were you when you first played 0:22:57.200 --> 0:23:01.520 video games? Well, I think my parents brought home about 0:23:01.520 --> 0:23:03.919 age seven or eight, and have you've been playing them 0:23:03.920 --> 0:23:06.639 continuously since then? Not quite. I have a lot of 0:23:06.640 --> 0:23:08.960 different hobbies, but it's a great thing to do for 0:23:09.000 --> 0:23:12.679 your screen time, and it's it's more intellectually engaging than television. 0:23:14.280 --> 0:23:18.199 Tell me about the technology set up that many gamers have, 0:23:18.400 --> 0:23:20.880 because if you're not in the gaming world, you're not 0:23:20.960 --> 0:23:27.520 necessarily aware of the power, the complexity, the vibrancy of 0:23:27.560 --> 0:23:31.159 the graphics that are now rudimentary when it comes to 0:23:31.160 --> 0:23:34.080 a game. That's a great point. There's a huge spectrum 0:23:34.160 --> 0:23:37.800 of of systems ranging from the most powerful, which will 0:23:37.840 --> 0:23:44.000 be your gaming PCs made by companies like Dell, alien Ware, HP, Lenovo, 0:23:44.119 --> 0:23:46.040 so on and so forth. And then you go down 0:23:46.080 --> 0:23:51.280 into the PlayStation four, the Xbox one, the Nintendo Switch. 0:23:51.960 --> 0:23:55.320 You have tablet gaming, you have mobile phone gaming. There's 0:23:55.720 --> 0:23:59.520 still arcade gaming out there, you have virtual reality. Uh, 0:23:59.560 --> 0:24:01.840 just a huge spectrum of gaming. And coming up in 0:24:01.880 --> 0:24:03.440 the next three to five years, there's going to be 0:24:03.480 --> 0:24:08.240 a revolutionary change in gaming as we moved to cloud streaming. 0:24:08.880 --> 0:24:11.919 Cloud streaming is where the game is being processed on 0:24:11.920 --> 0:24:14.440 a remote server and all you need is a very 0:24:14.480 --> 0:24:18.320 low power processor to play high quality graphics. So certainly 0:24:18.359 --> 0:24:22.800 gaming has expanded dramatically, and not just from a playing perspective, 0:24:22.840 --> 0:24:26.359 but also a spectating perspective. And there's one study that 0:24:26.440 --> 0:24:30.920 you highlighted that showed that professional video gaming just in general, 0:24:31.000 --> 0:24:37.200 the industry will search just this year alone. Okay, that's 0:24:37.240 --> 0:24:40.400 the backdrop. Let's move fast forward to where we are 0:24:40.520 --> 0:24:43.960 right now. Or there's some questions, particularly in China with 0:24:44.119 --> 0:24:50.040 their decision not to approve some pretty mainstream games, and 0:24:50.280 --> 0:24:53.280