WEBVTT - Princeton's Krueger Sees 'Moderation in Globalization' (Audio)

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<v Speaker 1>Broadcasting live to New York Bloomberg eleven, to Washington, d

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<v Speaker 1>C Bloomberg to Boston, Bloomberg Well under It, to San

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<v Speaker 1>Francisco Bloomberg ninety to the Country Series Exam Channel one

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<v Speaker 1>nine and around the globe the Bloomberg Radio Plus app

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<v Speaker 1>and Bloomberg Got Gone. This is taking stock. I'm Kathleen

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<v Speaker 1>Hayes Long pim Blos for broadcasting live the Bloomberg Markets

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<v Speaker 1>Most Influential Summit at our Bloomberg World headquarters. Globalization. Where

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<v Speaker 1>is it heading? Have we reached the end of globalization?

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<v Speaker 1>This is one of the topics here at Bloomberg Markets

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<v Speaker 1>Most Influential PIM And we're going to be speaking to

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<v Speaker 1>a panelist shortly to talk about, you know, maybe Donald

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<v Speaker 1>Trump shouldn't be so worried the trade is actually shrinking

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<v Speaker 1>in the global economy. Yes, our guests tub will be

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<v Speaker 1>Alan Krueger, a Princeton University professor of economics and public affairs,

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<v Speaker 1>former head of the Council Economic Advisors in the administration.

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<v Speaker 1>Right now, that let's Charlie Pellet in the Blue of

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<v Speaker 1>News Corporder Business left and I think it very much

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<v Speaker 1>PIM Fox. Thank you, Kathleen, Hayes, speaking of influence, gott

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<v Speaker 1>to begin with crude oil today surging four point four percent,

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<v Speaker 1>helping lift equities, the DAL, the SMP nestack all the

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<v Speaker 1>advancing West Texas intermediate crude now at forty six sixty

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<v Speaker 1>three for a barrel. OPEC agreeing to cut production for

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<v Speaker 1>the first time in eight years. And this uptake brought

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<v Speaker 1>to you by instinct options from Bank of America, Merrill Lynch,

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<v Speaker 1>Capture liquidity and US equity and index options, by trading,

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<v Speaker 1>by unleashing the in depth market insights and adaptive algo

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<v Speaker 1>strategies of instinct options. That's the power of global connections.

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<v Speaker 1>OPEC cutting production for the first time in eight years,

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<v Speaker 1>according to a delegate briefed on the matter, sending oil

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<v Speaker 1>prices up as Saudi Arabia and Irrong or Iran wrong

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<v Speaker 1>footed traders who expected a continuation of the pump and

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<v Speaker 1>Will policy Group adopted it in two thousand fourteen. Crude

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<v Speaker 1>oil up now by four point four percent, rallying two

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<v Speaker 1>dollars of the barrel to forty six sixty three. California,

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<v Speaker 1>the nation's largest issue of municipal bonds, is barring Wells

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<v Speaker 1>Fargo from underwriting state debt and handling its banking transactions

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<v Speaker 1>after the company admitted to opening potentially millions of bogus

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<v Speaker 1>customer accounts. Wells Fargo shares up one tenth of one percent,

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<v Speaker 1>Goal down six sixty, the Ounce down five tenths of

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<v Speaker 1>one percent, the tenure down to thirty seconds, Zeal one

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<v Speaker 1>point five seven percent, SMP five index up six again.

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<v Speaker 1>There of three tenths of one percent, and right now

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<v Speaker 1>three thirty two on Wall Street. Let's take a look

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<v Speaker 1>at some of the other stories making news. Thank you,

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<v Speaker 1>Charlie from the Bloomberg news Room. I'm Jill Schneider. This

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<v Speaker 1>news update is brought to you by the jeep Grand Cherokee,

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<v Speaker 1>For the first time in his presidency, Congress has voted

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<v Speaker 1>to override a President Obama veto. The House overwhelmingly voted

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<v Speaker 1>to seventy seven to override a bill that will allow

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<v Speaker 1>Saudi Arabia to be sued for involvement in the nine

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<v Speaker 1>eleven attacks. Earlier, the Senate voted nine seven to one,

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<v Speaker 1>with the single no vote coming from Minority Leader Harry Reid.

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<v Speaker 1>First Lady Michelle Obama is out campaigning for Hillary Clinton. Today,

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<v Speaker 1>Mrs Obama addressed a crowd at Philadelphia's LaSalle University. Remember,

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<v Speaker 1>it's not about voting for the perfect candidate. There is

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<v Speaker 1>no such person, and this election, it's about making a

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<v Speaker 1>choice between two very different candidates with very different visions

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<v Speaker 1>for our nation. Mrs Obama also said the country needs

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<v Speaker 1>quote an adult in the White House. Israel is mourning

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<v Speaker 1>the death of former President and Prime Minister Shimon Perez.

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<v Speaker 1>Former President Bill Clinton will be among those attending his

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<v Speaker 1>funeral Friday. I'm very grateful to him for a lifetime

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<v Speaker 1>of taking big thoughts and dreaming big dreams and figuring

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<v Speaker 1>out practical ways to achieve. The Penn Station, the nation's

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<v Speaker 1>busiest transit hub, could finally be getting a makeover. Governor

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<v Speaker 1>Andrew Cuomo has unveiled at one point six billion dollar

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<v Speaker 1>plan that would create a retail space at the James A.

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<v Speaker 1>Farley Building across the Avenue and a waiting hall for

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<v Speaker 1>Amtrak and Long Island Railroad passengers. Global News twenty four

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<v Speaker 1>hours a day, powered by more than twenty journalists and

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<v Speaker 1>analysts in more than one twenty countries. I'm Jil Schneider.

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<v Speaker 1>This is Bloomberg, Charlie, and we thank you, but again,

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<v Speaker 1>keeping an eye on crude oil. West Texas Intermediate up

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<v Speaker 1>now by four point four percent, a barrel of w

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<v Speaker 1>t I sixty three equities higher, SMP up six, a

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<v Speaker 1>gain of three tenths of one percent. I'm Charlie Pellett.

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<v Speaker 1>Thatath's a Bloomberg business flash. You're listening to Taking Stock

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<v Speaker 1>with Kathleen Mays and Pim Fox on Bloomberg Radcroft broadcasting

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<v Speaker 1>live today for the liver Market's most Influential Summit at

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<v Speaker 1>our world headquarters here in New York. Take a look

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<v Speaker 1>at globalization and where are the world is heading now,

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<v Speaker 1>particularly in this election year when there are so many

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<v Speaker 1>debates around trade, trade deals and more. Joining us now

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<v Speaker 1>is Alan Krueger, who's former head of the Council of

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<v Speaker 1>Economic Advisors, professor at Princeton University, and he's faring to

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<v Speaker 1>you talk about his panel today. Whether the sun is

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<v Speaker 1>setting on globalization? So Ellen, is it? Uh? Is it

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<v Speaker 1>twilight for globalization? Or is it just some dark clouds

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<v Speaker 1>obscuring the sun, so it feels like like the sun

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<v Speaker 1>is setting. The word I used was moderation. I think

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<v Speaker 1>we're seeing a moderate ration and globalization when it comes

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<v Speaker 1>to trade as well as when it comes to immigration.

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<v Speaker 1>Is this a bad thing or a good thing? I

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<v Speaker 1>think it was a somewhat inevitable thing in that there

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<v Speaker 1>was enormous rush of globalization when the Soviet Union collapsed

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<v Speaker 1>and Eastern Europe joined the modern world, the capitalist system, uh,

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<v Speaker 1>and then when China joined the world trading system, and

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<v Speaker 1>I think that that led to a long period of

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<v Speaker 1>expanding trade. And now we're reaching more of an equilibrium

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<v Speaker 1>point where wages have been driven up in China, the

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<v Speaker 1>infrastructure has been driven down to the point that they

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<v Speaker 1>are really quite stretched in terms of their infrastructure. We're

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<v Speaker 1>seeing companies bring more work back to the US. In fact,

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<v Speaker 1>we're seeing companies re shoring UH some work in the US,

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<v Speaker 1>and I think that trend will probably continue. The same

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<v Speaker 1>thing with immigration. I think we saw very rapid immigration

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<v Speaker 1>to the US, particularly from Mexico when we had our

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<v Speaker 1>housing bubble, and since then we've actually had a net

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<v Speaker 1>autmoinigration to Mexico. Professor Krueger, there's so much I want

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<v Speaker 1>to answer, so I just want to throw out some

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<v Speaker 1>topics and maybe get your maybe you can connect them.

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<v Speaker 1>For for us UM, one of your earliest pieces of

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<v Speaker 1>research has to do with the restaurant industry and minimum wage.

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<v Speaker 1>You've written books about wage inequality. We've also written a

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<v Speaker 1>book about terrorism. Wondering if there's a way to connect

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<v Speaker 1>all those things in the context of trade agreements and

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<v Speaker 1>what they will ultimately do in a variety of ways,

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<v Speaker 1>because trade is not just about stuff, it's about people.

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<v Speaker 1>And supposedly, if you actually know somebody, chances are you're

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<v Speaker 1>gonna feel less aggressive towards them, uh, because you're gonna

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<v Speaker 1>know something rather than just hear it or think it

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<v Speaker 1>or get that information that might not be true. Well,

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<v Speaker 1>there are a lot of crosscurrents are not So I'll

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<v Speaker 1>do I'll do my best. The point I think which

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<v Speaker 1>is underappreciated about trade agreements is they are as much

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<v Speaker 1>international relations policy as they are economic policy. And if

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<v Speaker 1>you look at NAFTA, for example, in our eighteen trillion

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<v Speaker 1>dollar economy in the US, NAFTA had very little effect

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<v Speaker 1>one way or the other in terms of our economic growth,

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<v Speaker 1>or wages. I think it was positive on that. I

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<v Speaker 1>think that's why the economy did so well in THEES

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<v Speaker 1>after NAFTA. But I would have to acknowledge that was

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<v Speaker 1>pretty small. But it did help our relationship with Mexico

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<v Speaker 1>and Canada. And now when returning to the other parts

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<v Speaker 1>of the world, do we want to have better relations

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<v Speaker 1>but the rest of the world or worst relations? I

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<v Speaker 1>think when it comes to our national security, it's better

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<v Speaker 1>to have better relations. So I think one aspect of

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<v Speaker 1>trade agreements is that it helps to further our national

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<v Speaker 1>security interests. And if you have a candidate who says

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<v Speaker 1>I'm going to tear up agreements that we have, I

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<v Speaker 1>think that works in reverse. And I think it makes

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<v Speaker 1>it very difficult to negotiate agreements that are in the

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<v Speaker 1>interests of the US, both economically and in our international

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<v Speaker 1>security interests. If we have bluster coming from politicians about

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<v Speaker 1>withdrawing from agreements which we have previously negotiated in good faith,

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<v Speaker 1>as we make future trader greaments, assuming that that happens. Uh.

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<v Speaker 1>Is it important though, to see that our experience with

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<v Speaker 1>China was not altogether good. Our our relationship with our trade,

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<v Speaker 1>our trade relatestions and the fact that they pegged their

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<v Speaker 1>currency for so long helped all about manufacturing in this country.

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<v Speaker 1>There's I think it's hard to dispute that also they've

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<v Speaker 1>blocked intellectual property, they stolen intellectual property. Is there some

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<v Speaker 1>way in future trade agreements that will makes sure that

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<v Speaker 1>free trade is fair trade. I think you raised very

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<v Speaker 1>important points and also recognized it was not trade agreement

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<v Speaker 1>that led to China's expansion in the US. UM, we

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<v Speaker 1>don't have a trade agreement with China. And one of

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<v Speaker 1>the arguments that President Obamas maybe I think is exactly

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<v Speaker 1>right is t p P UH would prevent China from

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<v Speaker 1>writing the rules of the road when it comes to

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<v Speaker 1>the economic relations in Asia. UH, it will be US

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<v Speaker 1>standards that would protect intellectual property. For example, we solved

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<v Speaker 1>them a lot of treasuries. That was something that we

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<v Speaker 1>did that they that they bought from us. Well, I

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<v Speaker 1>think they bought treasuries from US because they recognize that

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<v Speaker 1>we are the strongest, most responsible country in the world

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<v Speaker 1>UH and a good place to invest UM. And I

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<v Speaker 1>think we are now at a point where China's currency

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<v Speaker 1>is roughly valued appropriately. I think for a long time

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<v Speaker 1>it did um a weekend its currency. But I think now,

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<v Speaker 1>given how poorly China has fared over the last few

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<v Speaker 1>years and how much better the US has grown, you

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<v Speaker 1>would see a reversal. UH. So, I think it's very

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<v Speaker 1>hard to say that the currency manipulation UH is causing

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<v Speaker 1>a lot of damage to this economy today. Now, I

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<v Speaker 1>think that's something you need to monitor very closely going forward.

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<v Speaker 1>I want to thank you very much for coming in

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<v Speaker 1>and spending time with us. Alan Krueger. He is the

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<v Speaker 1>former head of the Council of Economic Advisors, currently a

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<v Speaker 1>professor at Princeton University, and the author of many books,

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<v Speaker 1>one Quality Education and Terrorists. You're listening to taking Stock,

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<v Speaker 1>I'm pin Fox my co host Kathleen Hayes. This is Bloomberg.

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<v Speaker 1>Bloombertaking's Stock is brought to you by Cone Resnick look Ahead,

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