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Speaker 2: It's always a good day when I hear Josh Green
Speaker 2: is coming on the show, of course, reporting and columnizing
Speaker 2: for Bloomberg Business Week. On this day that we find
Speaker 2: Donald Trump on Long Island. James Mahoney, our producer, is
Speaker 2: still with us today despite the fact that Donald Trump
Speaker 2: is going into the coliseum, He's going to be talking
Speaker 2: about salt. He's going to be talking about the border.
Speaker 2: That is the big event here today, promoting his promise
Speaker 2: to get salt back, remembering that he's the reason why
Speaker 2: this was an issue to begin with. JD Vance in Raleigh,
Speaker 2: North Carolina, and we're coming off Kamala Harris's.
Speaker 3: Big day at the NABJ.
Speaker 2: But with the Fed meeting in mind, the economy is
Speaker 2: something that kind of directs our focus today and that's
Speaker 2: where we start our conversation with Josh. It's great to
Speaker 2: see welcome back Grates to be back a balance of power.
Speaker 2: You've got a couple of columns I want to ask
Speaker 2: you about. One of them is awfully important as we
Speaker 2: consider this economic conversation. Democrats aren't sure which Kamala Harris
Speaker 2: they're going to get, and you bring us to the
Speaker 2: sidelines of the convention where we of course brought our
Speaker 2: audience here and the debate around specifically when it comes
Speaker 2: to the economy, what version of Kamala Harris we're going
Speaker 2: to see. She had an opportunity to speak to the
Speaker 2: Business Roundtable this week. Tim Wallas is apparently going instead.
Speaker 2: When do we find out, Well, we'll find out.
Speaker 3: The day after election day. Ok So, so you know,
Speaker 3: one of the stories.
Speaker 4: That I wrote for Business Week was about a conversation
Speaker 4: that was happening on the sidelines of the Democratic Convention
Speaker 4: among Democrats that really has not gotten any airtime at
Speaker 4: all because it's one Democrats don't want to have public
Speaker 4: and it's the anxiety especially among progressive Democrats, people like
Speaker 4: Bernie Sanders, Elizabeth Warren and AOC about what Kamala Harris
Speaker 4: really stands for. She doesn't have a kind of clear
Speaker 4: set of policy priorities. She's made very friendly noises towards
Speaker 4: the business community, whether it's Business Roundtable or the people
Speaker 4: she surrounded herselves with.
Speaker 3: And yet these progressives.
Speaker 4: Don't want to come out and publicly challenge her the
Speaker 4: way you would in a normal presidential election cycle because
Speaker 4: it's so late in the game and they don't want
Speaker 4: to give Donald Trump anything to attack her with.
Speaker 2: Which kind of leaves her to her own devices here.
Speaker 2: But what does Wall Street think? Because this conventional wisdom
Speaker 2: that Donald Trump is friendlier inherently to the markets brings
Speaker 2: us to an interesting standoff here because Kamala Harris hasn't,
Speaker 2: for instance, said that she wants to tax unrealized gains
Speaker 2: or some of the other things associated with Joe Biden.
Speaker 2: So does Wall Street know what it's getting?
Speaker 3: I don't think it does.
Speaker 4: But the since I've had in talking to people and
Speaker 4: talking to Wall Street lobbyists and talking to kind of
Speaker 4: pro business democrats, is that they're really feeling good about Harris.
Speaker 3: And I think the reason.
Speaker 4: For that is because she hasn't had her feet held
Speaker 4: to the flames by progressives like Elizabeth Warren, and so
Speaker 4: she's in a sense been able to present herself as
Speaker 4: being all things to all people, and that's a wonderful
Speaker 4: superpower if you're a politician, because one of the reasons
Speaker 4: why she's been able to unify the Democratic Party. But
Speaker 4: on the other hand, if you look at some of
Speaker 4: the things she's talked about in her economic speeches, attacking
Speaker 4: price gouging, that sort of things, these are noises that
Speaker 4: you would hear from a Sanders or a Warren and
Speaker 4: not something I think Wall Street would be super excited about.
Speaker 4: So I think she's really a big question mark for
Speaker 4: all Democrats.
Speaker 2: That's a great point. She did a pretty long interview yesterday.
Speaker 2: I know she's getting knocked for not doing many of them.
Speaker 2: The nabj as I mentioned is she really leaned on
Speaker 2: housing as the issue to appeal to not only the
Speaker 2: people in the room, but the crowd she's trying to
Speaker 2: reach on the campaign trail. That's not Wall Street, right,
Speaker 2: She's talking to consumers, people who don't feel like they
Speaker 2: have a foot in the door.
Speaker 3: Literally. Yeah.
Speaker 4: I mean, the way I think about it is that
Speaker 4: what Harris has done is present herself as a kind
Speaker 4: of middle of the road populist. And what I mean
Speaker 4: by that is she's sought to address the economic concerns
Speaker 4: that a lot of people have in light of all
Speaker 4: the inflation we've seen under the Harris Biden administration, housing
Speaker 4: prices of skyrocket.
Speaker 3: It's hard to buy a house.
Speaker 4: We know from polls, I know from talking to voters
Speaker 4: people are angry about that.
Speaker 3: They're concerned.
Speaker 4: So what she's doing is trying to allay their fears.
Speaker 4: So I don't think that that was a message necessarily
Speaker 4: about Wall Street. I think it was her trying to
Speaker 4: convey that I am a different politician. I'll be a
Speaker 4: different kind of president than Joe Biden. I'm gonna help
Speaker 4: bring down house prices. I'm gonna help you buy a house.
Speaker 2: Well, whatever economic message Donald Trump is trying to get
Speaker 2: forth and I will, you can tweet me, start sending
Speaker 2: them now, it's being clouded by what in the world
Speaker 2: is going on in Springfield, Ohio, which is something else
Speaker 2: that you're writing about as well. There's been some really
Speaker 2: great journalism the last twenty four to forty eight hours
Speaker 2: getting to the bottom of where these rumors came from.
Speaker 2: A Haitian immigrants eating pets and as Donald Trump suggests, geese.
Speaker 2: Apparently at one point this is a woman who had
Speaker 2: lost her cat and thought. She found the cat later
Speaker 2: in the basement and apologized to the Haitian immigrants in
Speaker 2: her community. The campaign, according to the Wall Street Journal,
Speaker 2: reached out to the city manager in Springfield on September
Speaker 2: ninth to find out if there's any truth to these rumors.
Speaker 2: The answer was no. It was the next day Donald
Speaker 2: Trump put them on television. And the way you're getting
Speaker 2: to this is it's kind of scary. A rational minded
Speaker 2: debate viewer might have assumed Trump's charge would hurt him.
Speaker 2: As you say, experts on misinformation say, that's not generally
Speaker 2: how it works. Tell us why and how scary are
Speaker 2: you know?
Speaker 4: I've done a lot of reporting and misinformation over the years,
Speaker 4: and this was just a wonderful distillation of how it
Speaker 4: works and how it doesn't necessarily work like people would
Speaker 4: think it would. You know, most rational minded people, as
Speaker 4: I wrote, would think that sounds absolutely crazy. It's going
Speaker 4: to have to boomerang and hurt Donald Trump. Why would
Speaker 4: he say something like that? Speaking the disinformation experts, I say,
Speaker 4: you know, that's not really how it works. What Trump
Speaker 4: is doing there is trying to reprogram the news conversation
Speaker 4: what people are talking about and I'll admit to somebody
Speaker 4: who's watching the debate in real time and writing my
Speaker 4: instant analysis on Bloomberg, I thought the big takeaway was
Speaker 4: the weakness of Trump's answer on abortion, his kind of
Speaker 4: meandering inability to say whether or not he would support
Speaker 4: a federal abortion van. I thought Harris was a big
Speaker 4: winner on that issue, and that was going to dominate
Speaker 4: the conversation.
Speaker 3: Yet here we are more than a week later. What
Speaker 3: are we talking about abortion?
Speaker 4: No, we're talking about misinformation about pettitting. And what that's done,
Speaker 4: according to these disentration experts, is it's really shifted the
Speaker 4: topic of political debate onto a subject immigration that Trump
Speaker 4: and Republicans are much more comfortable talking about, and it's
Speaker 4: denied a kind of media oxygen to talk about things
Speaker 4: it might have been more advantageous to Kamala Harris, whether
Speaker 4: it was Trump's in a to sort of explain how
Speaker 4: he'd replaced Obamacare, or whether it was you know, his
Speaker 4: his various attacks on her race and her qualifications. Nope,
Speaker 4: here we are talking about what Trump wants to talk about,
Speaker 4: which is kind of where we've been in the news for.
Speaker 3: The last ten years.
Speaker 2: Yeah, I guess that's also, dree, it was trending on
Speaker 2: Twitter before we went home that night of the debate,
Speaker 2: and it was everywhere. Of course, that next morning you
Speaker 2: did reach out to the campaign, which has essentially been
Speaker 2: blaming the media on this. But of course, to your
Speaker 2: point on Sunday morning, this was the topic.
Speaker 1: JD.
Speaker 2: Fance said, I created stories like these, made a lot
Speaker 2: of us wonder what his motivations were.
Speaker 4: Yeah, and Trump has subsequently praised Vance his vice presidential nominie,
Speaker 4: for creating stories about this.
Speaker 3: And does he mean that literally?
Speaker 5: Uh?
Speaker 3: With Trump, you can never quite be sure, but he
Speaker 3: usually says what's on his mind. So I think I
Speaker 3: think you probably can. Yeah.
Speaker 4: But what Advance explained and what the Trump campaign said
Speaker 4: to me was, look what we were trying to do.
Speaker 4: Shed a light on the problems that the influx of
Speaker 4: Haitian immigrants have had on Springfield, Ohio. The campaign spokes
Speaker 4: did not mention pet eating, but said, you know, public
Speaker 4: safety problem, stresses on public services, that sort of thing. Again,
Speaker 4: trying to redirect the news conversation to a subject that
Speaker 4: they feel is stronger for them than the various other
Speaker 4: things that Trump said in the campaign. As wild as
Speaker 4: that sounds to somebody who saw the debate in real
Speaker 4: time and ask themselves, what on earth is Trump talking about?
Speaker 2: We're out of time. Do you think he actually goes there?
Speaker 2: Donald Trump says he would visit Springfield.
Speaker 4: You know, it's hard for me to imagine how he
Speaker 4: could resist. It would be a scene, and Donald Trump
Speaker 4: will be right in the middle of it. And that's
Speaker 4: where he always.
Speaker 2: Wanted to magical logistics behind a visit like that, with
Speaker 2: state police already trying to keep people safe in Springfield,
Speaker 2: I'm really glad you could come see us. Let's do
Speaker 2: more of this between now and November.
Speaker 3: Sounds great if.
Speaker 2: You'd indulge me. Bloomberg Business Week, of course a couple
Speaker 2: of great columns for you to look out for from
Speaker 2: Josh Green. I'm Joe Matthew in Washington. We've got a
Speaker 2: lot more ahead on the fastest show in politics. Thanks
Speaker 2: for being with us on Bloomberg.
Speaker 1: You're listening to the Bloomberg Balance of Power podcast. Can
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Speaker 2: Thirty new polling out as we prepare to bring in
Speaker 2: our panel from the swing states, and this is a
Speaker 2: pretty big deal. With again the economy in mind. We've
Speaker 2: been asking, of course, voters in our own swing state
Speaker 2: poll who do you trust? Who do you trust more
Speaker 2: to handle the economy, interest rates, the price of goods,
Speaker 2: and nowhere more does that matter in the seven swing
Speaker 2: states that are going to decide this election. And we
Speaker 2: can drill down even more with the help of Quinnipiac
Speaker 2: University out with new polling today from three key swing
Speaker 2: states Pennsylvania, Michigan, Wisconsin. You know I were talking about
Speaker 2: them if you're familiar with this program before I even
Speaker 2: read you the numbers here, because this does bring good
Speaker 2: news to Kamala Harris Cridipiac polster Tim molloy writes the
Speaker 2: GOP's most go to attack strategies against Democrats on immigration
Speaker 2: and the economy, maybe losing momentum, likely voters now see
Speaker 2: a little daylight, he writes, in most cases between Harris
Speaker 2: and Trump on who can best handle those key issues.
Speaker 3: So here we go.
Speaker 2: Headline numbers Pennsylvania Harris fifty one, Trump forty five Michigan
Speaker 2: Harris fifty Trump forty five, Wisconsin Harris forty eight, Trump
Speaker 2: forty seven. She's leading, if not within the margin, in
Speaker 2: all three. But how about the economy. This is important.
Speaker 2: Likely voters were asked who they think would do a
Speaker 2: better job handling five issues, including this one the economy. Pennsylvania,
Speaker 2: they're basically time now fifty percent go Trump, forty eight Harris, Michigan,
Speaker 2: fifty percent Trump forty eight Harris Wisconsin. A little bit
Speaker 2: more of a gap fifty one percent Trump forty seven Harris.
Speaker 2: She was underwater on these numbers, of course, until now.
Speaker 2: And that's where we start with our signature panel. Rick
Speaker 2: Davis and Jeanie Shanzino are back with us today. Genie,
Speaker 2: of course, political science professor at Iona University and senior
Speaker 2: democracy fellow with the Center for the Study of the
Speaker 2: Presidency in Congress. Rick Davis partner Stone Court Capital. They
Speaker 2: are both Bloomberg Politics contributors. It's great to have you
Speaker 2: here as these polling numbers hit the tape. We've got
Speaker 2: a couple others today worth looking at. But Genie, when
Speaker 2: you drill down on the economy, specifically in these swing states,
Speaker 2: this looks like real progress for Kamala Harris. How do
Speaker 2: you read it?
Speaker 6: It does, and you know, I think I read it
Speaker 6: in two ways. Number one is it's a reflection of
Speaker 6: the fact that many voters were frustrated. They didn't feel
Speaker 6: like Joe Biden and his age and several other factors
Speaker 6: could fight for them. So he was having a difficult
Speaker 6: time on those issues. So we've got a new candidate.
Speaker 6: And the other factor is the numbers have improved in
Speaker 6: both of these areas. You look at immigration, the number
Speaker 6: of people coming across the border is way down. We're
Speaker 6: not hearing as much bad news from the border at
Speaker 6: this point. That's why Donald Trump has decided to go
Speaker 6: up to Springfield, Ohio. You look at the economic numbers,
Speaker 6: reports that for the first time since the pandemic, people's
Speaker 6: people are seeing an increase of about four percent in
Speaker 6: an increase in their income, and so these things are
Speaker 6: reflecting today we're looking at maybe the first interest rate
Speaker 6: cut in a long time. So the real numbers are
Speaker 6: helping out with a new candidate and we're seeing them
Speaker 6: close the gap. Donald Trump still owns these issues, but
Speaker 6: now it's almost in all cases within the margin of air.
Speaker 2: Rick, I'd love your take on this. We should mention
Speaker 2: the methodology here for a moment, thirteen hundred likely voters
Speaker 2: in Pennsylvania with a margin of error two point seven percent,
Speaker 2: slightly smaller samples in Michigan and Wisconsin with slightly larger
Speaker 2: three percentage point plus margins of error. Again for Michigan
Speaker 2: and Wisconsin. What is Kamala Harris doing right here? Or
Speaker 2: is it Donald Trump not talking enough about the economy?
Speaker 3: And before I get to that, Joe, I.
Speaker 7: Do want to add to your sort of description of
Speaker 7: the polls. And it is multi candidate field, so it
Speaker 7: isn't head to head. It includes Jill Stein in Michigan.
Speaker 7: I had a lot of people storried about and so
Speaker 7: I think these are probably the best pictures we've seen
Speaker 7: in a long time, after the debates, after all the
Speaker 7: things that have been going on, to properly reflect the
Speaker 7: stay of the race in the Blue Wall states again,
Speaker 7: was like Genie said, the base of the Biden campaign
Speaker 7: was the Blue Wall and it appears that may be
Speaker 7: the same for Kamala Harris. The reality is, when you're
Speaker 7: running campaigns, you don't want to see your opponent at
Speaker 7: that fifty that's a bad number. Forty eight, forty nine,
Speaker 7: forty seven. You still got like, Okay, there's a window
Speaker 7: I can get there. But the reality is you don't
Speaker 7: see Trump busting that forty six percent number very often.
Speaker 7: And the fact that the Harris campaign has gotten up
Speaker 7: over fifty percent in two of the key battleground states
Speaker 7: in the Blue Wall has got to be a very
Speaker 7: big concern for the Trump campaign. The fact that she's
Speaker 7: writing that popularity on improvements with the economy and immigration
Speaker 7: is equally disturbing. They have to have those issues on
Speaker 7: their side. It has to be a wedge in order
Speaker 7: to motivate their own candidate, their own voters. And so,
Speaker 7: you know, I think it's a perilous place to be.
Speaker 7: We've seen other polls in other you know, Sun Belt
Speaker 7: states that reflect a little bit better activity by Trump.
Speaker 7: But the reality is there's not much you need. If
Speaker 7: you win the Blue Wall and one electoral vote in Nebraska,
Speaker 7: you're president of the United States. That's two seventy And
Speaker 7: so this is this has got to shake up the
Speaker 7: tribe down in mar A Lago. They've got to be
Speaker 7: looking at this hard. And and then today you see
Speaker 7: Donald Trump futsing around in New York when he ought
Speaker 7: to be in Pennsylvania, Wisconsin or Michigan.
Speaker 2: Well, and these are the three states again we're talking
Speaker 2: about here, the actual swing states and Genie. It's not
Speaker 2: just the economy that we're looking at here. Donald Trump
Speaker 2: does lead Kamala Harris, but it's in fact within the margin.
Speaker 2: In Michigan, for instance, when it comes to immigration, that
Speaker 2: one really jumped off the page to me here it's
Speaker 2: much more pronounced. To Wisconsin fifty two percent go Trump,
Speaker 2: forty five percent Harris. Michigan there was forty nine to
Speaker 2: forty eight, Pennsylvania fifty to forty six. For what is
Speaker 2: one of the most powerful issues that Donald Trump has,
Speaker 2: and I'm going to point you to another one, an
Speaker 2: ipsos scripts pull today finding broad support for this idea
Speaker 2: of a mass deportation. A majority of Republicans maybe not
Speaker 2: a surprise, eighty six percent support the idea. But guess what,
Speaker 2: so to a quarter of Democrats twenty five percent to
Speaker 2: Rix points GINI. If Donald Trump just talked about these
Speaker 2: two things, the economy and the border, in the three
Speaker 2: swing states for the rest of this campaign, would that
Speaker 2: not be a strategy?
Speaker 6: It's a strategy. It's a better strategy than we've seen.
Speaker 6: You know, I think when we talked to Republicans after
Speaker 6: the debate, many scratched their head as to why Donald
Speaker 6: Trump it makes sense to keep pivoting to immigration, which
Speaker 6: he did consistently. He did not do the same when
Speaker 6: it came to the economy, and many Republicans wanted him
Speaker 6: to do that because that has been a week point
Speaker 6: for Democrats, and now these polls we see her closing
Speaker 6: this gap. So that would be a strategy to talk
Speaker 6: about these two issues consistently in the Blue Wall States.
Speaker 6: You know, I understand why Donald Trump is in New York.
Speaker 6: I'm in New York. Love New York. But to Rick's point,
Speaker 6: probably not the best use of your time when you're
Speaker 6: at your you know, you're about fifty days. But I
Speaker 6: would say this ipso's poll is utterly fascinating.
Speaker 1: You know.
Speaker 6: One thing I would caution against these kind of polls
Speaker 6: is sometimes they are reflection of people's real frustration with
Speaker 6: government's lack of addressing an issue, and in this case,
Speaker 6: it's immigration. It's been a crisis for decades, it has
Speaker 6: not been addressed in the way it should. We know
Speaker 6: that but I am not sure that people would hold
Speaker 6: this opinion if they saw in real time what a
Speaker 6: mass deportation looks like. So I have some concerns about
Speaker 6: this poll. You can look at the mass deportation if
Speaker 6: it happened from a lot of perspectives, including the cost,
Speaker 6: but just from the humanitarian perspective alone, I think you'd
Speaker 6: see a decrease in that number if it came to fruition.
Speaker 6: So I think this is more a reflection of people's concerns,
Speaker 6: which to your point, means Donald Trump should be talking
Speaker 6: about this issue. But he's also got a hit on
Speaker 6: the economy in these swing states because when she closes
Speaker 6: this gap this way, that is a problem for him
Speaker 6: because how does he surround that.
Speaker 2: I don't know what your thought is on this mass
Speaker 2: deportation pull, Rick, GENI. You might have a point when
Speaker 2: people start seeing the police knocking on doors at their
Speaker 2: neighbor's house twenty five percent. Though a quarter of Democrats
Speaker 2: think this is a good idea, at least on paper, Rick,
Speaker 2: how would you exploit that as a campaign operative?
Speaker 7: You know, Look, I mean I think that the president,
Speaker 7: the President Trump has not done enough to articulate plans
Speaker 7: on how to mine gate immigration. It's almost been, you know,
Speaker 7: sort of his go to place. He likes to talk
Speaker 7: about Springfield, Ohio these days, which actually isn't a policy.
Speaker 7: And the reality is if he did talk more about
Speaker 7: articulating his plans for things like a deportation or strengthening
Speaker 7: the border, or what's he going to do with Mexico,
Speaker 7: I mean, the reality is he did more of that
Speaker 7: in twenty sixteen, and he's doing today, and he's not
Speaker 7: doing himself any favors because, as you see from these
Speaker 7: polls and as Genie articulated, people universally are frustrated with
Speaker 7: the southern border and they want to have it fixed.
Speaker 7: And the fact that Donald Trump actually can point to,
Speaker 7: you know, numbers on the southern border that are better
Speaker 7: than the Biden Harris administration, it's stunning to me that
Speaker 7: he doesn't talk about it more. The reality is he's
Speaker 7: so into sensationalizing these issues, talking about Haitian immigrants eating
Speaker 7: dogs and cats, which he has to make up in
Speaker 7: order to do it. He would be much better off
Speaker 7: talking about the facts on the ground and real solutions.
Speaker 7: And I think he would really cut into democratic margins
Speaker 7: on this, as you see in this current blue Wall
Speaker 7: state pole. I mean, Gris is now caught up to
Speaker 7: him on immigration in those places.
Speaker 2: That is remarkable, and I know that he's going to
Speaker 2: talk about it a lot tonight, Genie at the Coliseum,
Speaker 2: Donald Trump on Long Island. He's going to be in
Speaker 2: representative of d'esposito's district talking about this, and you know
Speaker 2: how that plays in that district. Can Donald Trump do
Speaker 2: himself a favor, even though he's in New York with
Speaker 2: considering the audience, the reception he's going to get tonight,
Speaker 2: and the social media coverage that will follow, you know.
Speaker 6: He absolutely could. The reality is is that Long Island
Speaker 6: is a conservative place. People are very frustrated all across
Speaker 6: the country, but in New York in particular, about the
Speaker 6: issue of the economy and about immigration. But he has
Speaker 6: to do, to Rick's point, lay out a plan. And
Speaker 6: the problem with what he's been doing with this issue
Speaker 6: in Springfield, Ohio is that he is talking about something
Speaker 6: that if you just take a glance at social media,
Speaker 6: people are laughing at They have dogs and cats running
Speaker 6: away from Springfield, Ohio. Memes all over the place that
Speaker 6: Democrats could never buy. But the reality is this is
Speaker 6: a serious issue for people in New York. Just as
Speaker 6: an example, the immigrants that have come up here, that
Speaker 6: have been sent up here in many cases by southern governors,
Speaker 6: have flooded the school districts. This is a problem for
Speaker 6: people in New York. So talk about the pain they
Speaker 6: are feeling and how you're going to address that, rather
Speaker 6: than talking about unsubstantiated rumors which have now been totally
Speaker 6: debunked about people eating cats and dogs, and that would
Speaker 6: do him a favor. But I would also caution it
Speaker 6: wasn't long ago on Long Island, as you know, Joe,
Speaker 6: we saw a Democrat take on the issue of immigrant
Speaker 6: very successfully and win. So Donald Trump has his work
Speaker 6: cut out for him. He's got to be disciplined and
Speaker 6: that's not his strong suit in these rallies.
Speaker 2: Well, we'll be listening closely to the message tonight inside
Speaker 2: the coliseum.
Speaker 1: You're listening to the Bloomberg Balance of Power podcast. Catch
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Speaker 8: I'm Kaylee Lines alongside Joe Matthew here in Washington, where
Speaker 8: we do know roughly thirty six minutes from now, we'll
Speaker 8: have answers to a few questions. We will know what
Speaker 8: the move was twenty five or fifty basis points. We
Speaker 8: will know whether or not this was a unanimous decision
Speaker 8: or maybe unusually, we might have dissents. We'll also know
Speaker 8: what the dot plot looks like, not just about this
Speaker 8: cut today, but what they expect to do over the
Speaker 8: coming meetings into next year. But the other answers will
Speaker 8: be left to one individual, Chairman Powell, when he takes
Speaker 8: the podium in that new conference thirty minutes later. And
Speaker 8: that's always where it gets a little tricky, that's.
Speaker 2: Right, taking questions from the likes of Michael McKee, who'll
Speaker 2: be reporting a bit later on for Bloomberg of course.
Speaker 2: And yeah, we're knocking to dust off of plot from June,
Speaker 2: I believe, with a major update today. And this is
Speaker 2: where we start our conversation with Catherine Edwards's economic policy
Speaker 2: consultant writer for Bloomberg Opinion. Catherine, welcome back.
Speaker 3: It's great to see you.
Speaker 2: I think you're in the fifty camp. You can let
Speaker 2: us know if it's if that is the case. Though
Speaker 2: getting to Kayley's reference, does J. Powell need to have
Speaker 2: a unanimous decision?
Speaker 5: I do wonder about what unanimity gives you when he
Speaker 5: has made very clear that the risk right now is
Speaker 5: to the labor market and not the fight against inflation.
Speaker 5: I mean, he signaled that pretty clearly at Jackson Hole.
Speaker 5: And so to have someone you know not in concert,
Speaker 5: you know, signifies to me either that they don't think
Speaker 5: the labor market as important, which would be upsetting, I
Speaker 5: think to a lot of people, or they're signifying that
Speaker 5: he has hasn't gone far enough, and they tend to
Speaker 5: I think, kind of close ranks and come together around
Speaker 5: the big decisions to let everyone know that this economy
Speaker 5: is being steered, you know, in concert.
Speaker 8: So if we consider what the what he would have
Speaker 8: to personally message if the move is fifty because there
Speaker 8: is a narrative out there that a move of that
Speaker 8: size could signal panic that they are seeing something that
Speaker 8: the rest of us might not be yet, that there
Speaker 8: is more reason for concern in the economy right now.
Speaker 8: So how important would his messaging be, frankly, in either
Speaker 8: instance to explain why they felt the need to frontload
Speaker 8: or not to frontload.
Speaker 5: Yeah, and I worry that if the message around fifty
Speaker 5: is or the message around twenty five would be, well,
Speaker 5: we just didn't want to play into market expectations or
Speaker 5: we didn't want to think that people were panicking of
Speaker 5: how much is the message around what other people will
Speaker 5: be messaging versus what the economy needs. And I think
Speaker 5: what I've seen in Powell over the years is that
Speaker 5: he tends to be very plain spoken about this was
Speaker 5: what the economy needed right now, and if we messed up,
Speaker 5: we messed up. If we went too low in the past,
Speaker 5: we went to low in the past. But it's about
Speaker 5: meeting the needs of the transitory. If we said transitory
Speaker 5: and we were wrong, then we were wrong. And I
Speaker 5: think a lot of people were expecting to cut last
Speaker 5: time they met. They didn't. They didn't do that, So
Speaker 5: I it is very possible for him to say, this
Speaker 5: is just what the economy needs. It's not panic, it's
Speaker 5: it's prescriptive, and.
Speaker 3: This is good.
Speaker 2: It's not panic prescriptive. How about politics, this is the
Speaker 2: politics program. We'll hand things off to the market experts
Speaker 2: in about five minutes. Does he need to be deliberate
Speaker 2: about this issue?
Speaker 5: I mean, I think the narrative is kind of forcing
Speaker 5: his hand there to say that this. You know, they
Speaker 5: can't take an election into into accounts. You know, I
Speaker 5: kind of think of this as making a little bit
Speaker 5: of the James Comy mistake, you know, working so hard
Speaker 5: to look like you're not in support of one person
Speaker 5: that you actively start supporting the other. You know, you overcorrect.
Speaker 5: I mean, that's that's not a word that the FED
Speaker 5: really likes, over correcting, but that it's definitely a possibility
Speaker 5: when you're trying to take into account politics. And you know,
Speaker 5: what I would say is politics. I mean, economics is hard,
Speaker 5: and there's no need to bring politics into this decision.
Speaker 8: So if politics don't factor into the actual outcomes from
Speaker 8: the Federal Reserve, that's not to say that what the
Speaker 8: Federal Reserve decides to do doesn't affect outcomes in politics.
Speaker 8: This is a decision that they're going to be making
Speaker 8: weeks ahead of a presidential election. So I guess the
Speaker 8: question is to what extent do you expect that the
Speaker 8: actual beginning of the easing cycle will influence consumer sentiment
Speaker 8: If it is coming simultaneously with a slowdown in the
Speaker 8: labor market, that might be felt first knowing that even
Speaker 8: eas policy might have a lad defect kicking in.
Speaker 5: I mean, most people's impression of the economy is what
Speaker 5: they experience in their day to day lives, and whatever
Speaker 5: they read in the newspaper or see on the news,
Speaker 5: it's still just how secure they feel. Can they afford
Speaker 5: a home, can they find a job? So I think yes,
Speaker 5: the narrative that you can spend some type of narrative
Speaker 5: of like, oh, and here's DC conspiring to help come.
Speaker 5: I mean people are going to say that, and then
Speaker 5: they're going to say like, oh, he didn't go far
Speaker 5: enough because they want to help Trump. I mean that
Speaker 5: all of that is possible. I think think the real
Speaker 5: question is will people see an improvement in their lives?
Speaker 5: And if they don't, if they don't start acting in
Speaker 5: the labor market's best interest soon, the answer to that
Speaker 5: is almost certainly going to be known.
Speaker 2: If you're Kamala Harris, though you're hoping for a psychological
Speaker 2: impact today, this is a good headline. I don't know
Speaker 2: to what extent shal message. That was one of the
Speaker 2: conversations we were having earlier. But how about in terms
Speaker 2: of material improvement for consumers? This is a short period
Speaker 2: of time.
Speaker 5: It's a short period of time. Yet maybe there's a
Speaker 5: mood boost to this, but it's there's one hundred and
Speaker 5: sixty five million workers in a pretty large economy. You
Speaker 5: don't get to take really dramatic right or left turns.
Speaker 5: And frankly, we don't want the economy to do that.
Speaker 5: I mean, we want to be on a steady path.
Speaker 5: And that can be really frustrating for people who want
Speaker 5: relief immediately. Just to say it's going to get better soon,
Speaker 5: it's cold comfort. So maybe people start cheering about how
Speaker 5: well the economy is doing, and that makes people more
Speaker 5: mad because they still haven't found their jobs. It's so
Speaker 5: hard to predict how an individual will internalize this great,
Speaker 5: big economy that they participate in.
Speaker 8: Or one of the most immediate transmissions might be in
Speaker 8: mortgage rates in the housing market. This is selfish coming
Speaker 8: for me as I'm in the process of trying to
Speaker 8: buy my first home and I'm like, rates go as
Speaker 8: low as possible, please, right, get down. But that's where
Speaker 8: the dot plot will come into play, because those will
Speaker 8: start moving even before the cuts come. If the expectation
Speaker 8: is there that rates are going to go materially lower.
Speaker 5: Yeah, I think that if we can get built in
Speaker 5: reductions to the mortgage rates, to get the housing market unlocked,
Speaker 5: to get people to be willing to sell their homes
Speaker 5: so that you can buy one. Hopefully it's a great place.
Speaker 5: Can you just lift off the specs that you're looking
Speaker 5: for here and we'll telegraph that right to now. I
Speaker 5: you know, yeah, I mean there's lots of relief coming.
Speaker 5: But I think sometimes we get a little bit upside
Speaker 5: down thinking in elections about what does one person want
Speaker 5: versus the other? And it's always helpful to remember that
Speaker 5: the housing market has been brutal for so many Americans
Speaker 5: for these past few years, and any type of movement,
Speaker 5: however it affects the election, is good for our economy.
Speaker 5: For people to feel confident that they can do something
Speaker 5: that they see is so fundamental as buying a home.
Speaker 2: Should Kamala Harris today credit for winning the war on inflation?
Speaker 2: I think the first cut we finally made it.
Speaker 5: That would be so foolhardy. But I would never put
Speaker 5: it past the politician not to take credit for something good. Yeah,
Speaker 5: well that's different, right.
Speaker 8: Well, I guess so finally, before we let you go,
Speaker 8: we just have a minute left. There's also the consideration
Speaker 8: of fiscal policy, always that the FED doesn't have influence on,
Speaker 8: but they do have to react to if we actually
Speaker 8: see the policy proposals. Frankly from both of these candidates
Speaker 8: coming to fruition, there's an argument that they would be
Speaker 8: inflationary and maybe cut this cutting cycle short.
Speaker 5: Do you agree, yes, I mean we haven't seen, you know,
Speaker 5: a lot of fiscal responsibility telegraphed from either candidate. We've
Speaker 5: got record deficits right now. We're We're not, you know,
Speaker 5: at an active war, We're not in an active recession.
Speaker 3: Deficits should not be this high.
Speaker 5: We have sabotaged our ability to collect sufficient revenue from
Speaker 5: the federal governments. And at some point we are going
Speaker 5: to need an adult in the room say we are
Speaker 5: not raising enough money. They're not going to say that
Speaker 5: six weeks before an election, but someone needs to say it.
Speaker 8: Maybe Palable today, who.
Speaker 5: Knows be a moment that that would be a moment.
Speaker 8: A great to have you on FED day. Thank you
Speaker 8: so much for joining us. Catherine, of course, Bloomberg opinion
Speaker 8: columnist and an economic policy consultant.
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