1 00:00:02,400 --> 00:00:06,760 Speaker 1: Bloomberg Audio Studios, Podcasts, radio news. 2 00:00:11,600 --> 00:00:15,440 Speaker 2: This is the Bloomberg Surveillance Podcast. I'm Jonathan Ferrow, along 3 00:00:15,440 --> 00:00:18,360 Speaker 2: with Lisa Bromwitz and am Marie Hordern. Join us each 4 00:00:18,480 --> 00:00:21,360 Speaker 2: day for insight from the best in markets, economics, and 5 00:00:21,400 --> 00:00:24,720 Speaker 2: geopolitics from our global headquarters in New York City. We 6 00:00:24,760 --> 00:00:27,400 Speaker 2: are live on Bloomberg Television weekday mornings from six to 7 00:00:27,480 --> 00:00:31,000 Speaker 2: nine am Eastern. Subscribe to the podcast on Apple, Spotify 8 00:00:31,200 --> 00:00:33,479 Speaker 2: or anywhere else you listen, and as always on the 9 00:00:33,479 --> 00:00:37,080 Speaker 2: Bloomberg Terminal and the Bloomberg Business App. Mike Wilson of 10 00:00:37,080 --> 00:00:40,840 Speaker 2: Morgan Stanley writing this week's reciprocal tariff announcement is likely 11 00:00:40,880 --> 00:00:44,920 Speaker 2: a stepping stone for further negotiations as opposed to a 12 00:00:45,000 --> 00:00:48,160 Speaker 2: clearing event. Mike joins us now for more. Mike, good morning, 13 00:00:48,240 --> 00:00:50,400 Speaker 2: Good morning John. What is that distinction important? 14 00:00:50,680 --> 00:00:52,559 Speaker 3: Well, I think that you know, everybody's looking for like 15 00:00:52,600 --> 00:00:55,480 Speaker 3: a final piece here is this is gonna take time, 16 00:00:55,560 --> 00:00:58,240 Speaker 3: you know, and not unlike a lot of the other 17 00:00:58,240 --> 00:00:59,920 Speaker 3: policies that have come out this year. 18 00:00:59,760 --> 00:01:02,040 Speaker 4: Like this is this is what we kind of signed 19 00:01:02,120 --> 00:01:02,680 Speaker 4: up for, right. 20 00:01:02,720 --> 00:01:05,160 Speaker 3: I don't think what so far what the President has 21 00:01:05,160 --> 00:01:09,440 Speaker 3: done has really been surprising. All of the policy changes 22 00:01:09,520 --> 00:01:12,039 Speaker 3: so far have been growth negative. And that you know, 23 00:01:12,120 --> 00:01:15,240 Speaker 3: we've likened this to a new CEO coming in, right 24 00:01:15,280 --> 00:01:17,720 Speaker 3: they have. They're one a restructure to company. They are 25 00:01:17,720 --> 00:01:20,440 Speaker 3: restructuring the company. They're going to kitchen sink it, and 26 00:01:20,480 --> 00:01:22,160 Speaker 3: then they're going to try to make you know, their 27 00:01:22,200 --> 00:01:23,440 Speaker 3: plan work for next year. 28 00:01:23,560 --> 00:01:25,720 Speaker 4: So this is a this is going to take some time. 29 00:01:25,800 --> 00:01:27,800 Speaker 3: And you know, this level that we're at now is 30 00:01:27,840 --> 00:01:31,000 Speaker 3: critical from a market standpoint, not so much from the 31 00:01:31,000 --> 00:01:32,200 Speaker 3: administration standpoint. 32 00:01:32,240 --> 00:01:34,160 Speaker 4: I think that's also something of knowledge. 33 00:01:34,240 --> 00:01:36,400 Speaker 5: It's also very on brand for Trump to take a 34 00:01:36,440 --> 00:01:39,240 Speaker 5: maximalist approach in the very beginning. But how messy could 35 00:01:39,240 --> 00:01:42,000 Speaker 5: it be if he comes in with this maximalist, aggressive 36 00:01:42,000 --> 00:01:44,759 Speaker 5: approach and then we have retaliation from trading partners. 37 00:01:44,920 --> 00:01:46,920 Speaker 3: Well, look, it's the NAFTA and so like you know, 38 00:01:46,959 --> 00:01:50,080 Speaker 3: it's the best alternative to a negotiated agreement and the 39 00:01:50,120 --> 00:01:54,320 Speaker 3: batna and that is that is classic negotiating tactic. You 40 00:01:54,320 --> 00:01:56,200 Speaker 3: you come in and way over here to the right 41 00:01:56,520 --> 00:01:58,240 Speaker 3: with the hope of kind of settling in the middle. 42 00:01:58,320 --> 00:02:01,480 Speaker 3: So I don't think that's unusual either. The response from 43 00:02:01,840 --> 00:02:03,520 Speaker 3: trade partners is that means they're engaging. 44 00:02:03,640 --> 00:02:03,960 Speaker 4: Okay. 45 00:02:04,040 --> 00:02:07,600 Speaker 3: So that's how you get people to engage in your discussion. 46 00:02:07,640 --> 00:02:09,799 Speaker 3: You come out with a big splash. They have to 47 00:02:09,840 --> 00:02:12,000 Speaker 3: come to the table and negotiations begin. 48 00:02:12,280 --> 00:02:14,200 Speaker 4: We're not even at the table yet, okay. So that's 49 00:02:14,200 --> 00:02:16,160 Speaker 4: why this is going to be very uncertain for a 50 00:02:16,160 --> 00:02:16,680 Speaker 4: period of time. 51 00:02:16,720 --> 00:02:18,239 Speaker 5: I think some countries think that they are at the 52 00:02:18,240 --> 00:02:20,040 Speaker 5: table because they sent a few representatives here in the 53 00:02:20,040 --> 00:02:21,760 Speaker 5: past few weeks. But I agree with you, it really 54 00:02:21,840 --> 00:02:22,560 Speaker 5: hasn't started. 55 00:02:22,800 --> 00:02:24,960 Speaker 6: So what do you do if you're an investor. 56 00:02:24,720 --> 00:02:26,320 Speaker 4: Well, you've done what we've sort of done. 57 00:02:26,639 --> 00:02:28,160 Speaker 3: You avoid the areas that are going to be most 58 00:02:28,160 --> 00:02:31,320 Speaker 3: effective consumer discretionary goods, and that area has been hit 59 00:02:31,360 --> 00:02:33,919 Speaker 3: the hardest. So maybe that's getting a little bit extreme. 60 00:02:34,639 --> 00:02:37,600 Speaker 3: I would say, you know, defensively position high quality. That's 61 00:02:37,639 --> 00:02:39,840 Speaker 3: been our core portfolio. Now we've made some trading calls 62 00:02:39,880 --> 00:02:42,560 Speaker 3: lately that would have gone against that. Some of those works, 63 00:02:42,560 --> 00:02:44,280 Speaker 3: some of those didn't work. But I think at this point, 64 00:02:44,360 --> 00:02:45,880 Speaker 3: you want to be up the quality courves. Want to 65 00:02:45,880 --> 00:02:48,120 Speaker 3: be in businesses that can kind of mitigate some of 66 00:02:48,120 --> 00:02:50,680 Speaker 3: these concerns. You have pricing power, you have the ability 67 00:02:50,720 --> 00:02:53,640 Speaker 3: to kind of move production around you can take inventory 68 00:02:53,680 --> 00:02:55,880 Speaker 3: on to kind of buffer this for sixty or ninety days, 69 00:02:55,880 --> 00:02:58,240 Speaker 3: which you've seen all those mitigation strategies somemp to work 70 00:02:58,240 --> 00:03:00,440 Speaker 3: wrote about in our note today. Those are the kind 71 00:03:00,440 --> 00:03:02,360 Speaker 3: of companies we want to own in this period of time. 72 00:03:02,760 --> 00:03:04,400 Speaker 3: I do believe there will be a clearing event at 73 00:03:04,440 --> 00:03:04,960 Speaker 3: some point this. 74 00:03:05,000 --> 00:03:06,200 Speaker 4: Year, but we're not there yet. 75 00:03:06,320 --> 00:03:08,000 Speaker 2: Some of the changes you have made the artwork, and 76 00:03:08,080 --> 00:03:11,800 Speaker 2: let's talk about them. International NEX this morning down two percent, 77 00:03:12,080 --> 00:03:15,840 Speaker 2: nie K overnight down four percent. International starting to turn 78 00:03:16,120 --> 00:03:18,639 Speaker 2: subtle change from where we were over the last month 79 00:03:18,720 --> 00:03:18,880 Speaker 2: or so. 80 00:03:19,000 --> 00:03:19,600 Speaker 7: What's changing? 81 00:03:19,760 --> 00:03:22,440 Speaker 3: Well, that's right, and so last week's note we kind 82 00:03:22,440 --> 00:03:24,639 Speaker 3: of made the call that US probably does better than 83 00:03:24,639 --> 00:03:26,560 Speaker 3: these other regions because at the end of the day, 84 00:03:26,600 --> 00:03:29,560 Speaker 3: those reasons you mentioned are most sensitive to global trade, 85 00:03:29,560 --> 00:03:32,600 Speaker 3: particularly Japan. So the fact that that was down four percent, 86 00:03:32,639 --> 00:03:35,440 Speaker 3: I think is another sign that, hey, actually the market 87 00:03:35,440 --> 00:03:38,560 Speaker 3: now is laser focused on this terror for trade issue 88 00:03:38,720 --> 00:03:40,440 Speaker 3: as opposed to some of the other issues that it's 89 00:03:40,480 --> 00:03:43,440 Speaker 3: been kind of worrying about here. So that relative value, 90 00:03:43,480 --> 00:03:45,640 Speaker 3: if you will, looks still looks good to us. It 91 00:03:45,680 --> 00:03:48,800 Speaker 3: may happen in a downtape, okay, which is also somebody 92 00:03:48,800 --> 00:03:51,240 Speaker 3: to consider, because the US is still the highest quality 93 00:03:51,720 --> 00:03:54,800 Speaker 3: market in the world. In a uncertain world, high quality 94 00:03:54,880 --> 00:03:55,520 Speaker 3: will outperform. 95 00:03:55,600 --> 00:03:57,920 Speaker 2: But you think those European long sort of built up 96 00:03:57,960 --> 00:03:59,720 Speaker 2: over the past few months there might be in trouble here. 97 00:04:00,000 --> 00:04:00,400 Speaker 4: Think that's right. 98 00:04:00,400 --> 00:04:03,040 Speaker 3: I think there's a little extension. You know, our European 99 00:04:03,440 --> 00:04:06,040 Speaker 3: strategy team is in the same page. I mean, there 100 00:04:06,080 --> 00:04:08,440 Speaker 3: are some good things going on in Europe that haven't 101 00:04:08,480 --> 00:04:11,760 Speaker 3: been happening for decades potentially, But boy, that's gonna take 102 00:04:11,800 --> 00:04:14,280 Speaker 3: that's gonna take even longer than this, you know, sort 103 00:04:14,280 --> 00:04:17,159 Speaker 3: of tariff negotiation you're talking about, you know, country spending 104 00:04:17,160 --> 00:04:19,840 Speaker 3: more money on fiscal deregulation. I mean, this is a 105 00:04:19,920 --> 00:04:22,960 Speaker 3: multi year transition in the stock market. You know, some 106 00:04:23,080 --> 00:04:24,480 Speaker 3: cases are fifteen to twenty percent. 107 00:04:24,600 --> 00:04:29,040 Speaker 5: So besides Ryan Mattel or any other industrial military company 108 00:04:29,240 --> 00:04:30,760 Speaker 5: in Europe, do you like anything there? 109 00:04:30,960 --> 00:04:32,800 Speaker 3: Well, I mean, I think the financials have been still 110 00:04:32,800 --> 00:04:35,520 Speaker 3: a place to think about that have a potential structural 111 00:04:35,600 --> 00:04:38,120 Speaker 3: change or benefit in that regard. I think things that 112 00:04:38,160 --> 00:04:40,520 Speaker 3: have levered to the consumer. But once again, these are 113 00:04:40,640 --> 00:04:44,039 Speaker 3: these kind of got extended, you know, and from my standpoint, 114 00:04:44,080 --> 00:04:46,320 Speaker 3: I think there's better value now in the US and 115 00:04:46,360 --> 00:04:47,080 Speaker 3: some of these areas. 116 00:04:47,160 --> 00:04:49,400 Speaker 2: I'm sure you saw the new numbers coming out Goldman Saxon, 117 00:04:49,440 --> 00:04:51,400 Speaker 2: the same new foal costs from Yonhtsias. 118 00:04:51,440 --> 00:04:52,800 Speaker 7: If we can just throw them up on the screen. 119 00:04:53,200 --> 00:04:56,560 Speaker 2: One percent on GDP, three point five percent on PCA, 120 00:04:56,960 --> 00:04:59,200 Speaker 2: that's a siflation remix. What are you a ton of 121 00:04:59,200 --> 00:05:01,279 Speaker 2: clients that ross? Can you about how we would try 122 00:05:01,360 --> 00:05:03,080 Speaker 2: stackflation in America? 123 00:05:03,279 --> 00:05:05,640 Speaker 3: We're not quite in the stagflation camp. We're more in 124 00:05:05,680 --> 00:05:08,080 Speaker 3: the camp that you know, expectations are probably not where 125 00:05:08,160 --> 00:05:10,880 Speaker 3: reality is, which is that growth is worse than people 126 00:05:10,920 --> 00:05:12,760 Speaker 3: thought and inflation is a bit stickier. 127 00:05:12,800 --> 00:05:14,159 Speaker 4: And that's how we came into this year. 128 00:05:14,480 --> 00:05:16,080 Speaker 3: So we don't we didn't mess around with our year 129 00:05:16,160 --> 00:05:17,760 Speaker 3: end targets, but we have been messing around with our 130 00:05:17,800 --> 00:05:20,080 Speaker 3: short term targets. So we're in that fifty five hundred 131 00:05:20,120 --> 00:05:22,200 Speaker 3: to I would say fifty eight to fifty nine. Now 132 00:05:22,240 --> 00:05:24,200 Speaker 3: we've kind of chopped off the upper end of that 133 00:05:24,480 --> 00:05:26,920 Speaker 3: for the first half of this year. I'm not willing 134 00:05:26,960 --> 00:05:29,480 Speaker 3: to throw in the towel yet completely on the full year, because, 135 00:05:29,760 --> 00:05:32,320 Speaker 3: as we've been saying, the good stuff of you know, 136 00:05:32,360 --> 00:05:34,919 Speaker 3: the policy changes that we expect could start to feed 137 00:05:34,960 --> 00:05:37,679 Speaker 3: into the equity markets by year end. Could we pushed 138 00:05:37,680 --> 00:05:39,839 Speaker 3: that timing out, you know, three six months? 139 00:05:39,960 --> 00:05:40,320 Speaker 6: Sure? 140 00:05:40,600 --> 00:05:42,360 Speaker 3: But you know, right now we're still in that fifty 141 00:05:42,400 --> 00:05:44,280 Speaker 3: five hundred to sixty one hundred range with the probably 142 00:05:44,320 --> 00:05:47,800 Speaker 3: a truncated upper band. And now if you get universal terrafs, 143 00:05:47,800 --> 00:05:49,960 Speaker 3: which is something that we talked about in this morning's note, 144 00:05:50,160 --> 00:05:52,680 Speaker 3: then that lower half, that lower end of the band. 145 00:05:52,520 --> 00:05:53,359 Speaker 4: Maybe comes down. 146 00:05:53,480 --> 00:05:55,760 Speaker 3: So we're you know, if we if we break down 147 00:05:55,800 --> 00:05:58,440 Speaker 3: this week and universal terrors for the reason, we could 148 00:05:58,440 --> 00:06:00,760 Speaker 3: see something even lower than fifty five in the short term. 149 00:06:00,760 --> 00:06:03,279 Speaker 2: Can we talk about the rebalancing your expecting though, the 150 00:06:03,360 --> 00:06:06,120 Speaker 2: ultimate vision of this administration and why you still believe 151 00:06:06,160 --> 00:06:08,560 Speaker 2: the more complete policy mix is still bullish. 152 00:06:08,839 --> 00:06:10,680 Speaker 3: Yeah, I think, well, I think it's constructive. I'm not 153 00:06:10,680 --> 00:06:13,719 Speaker 3: sure it's wildly bullish, because you know, valuations were probably 154 00:06:13,760 --> 00:06:15,680 Speaker 3: the biggest constraint coming in. I think it's bullish for 155 00:06:15,680 --> 00:06:17,839 Speaker 3: a lot of parts of the market that have underperformed 156 00:06:18,160 --> 00:06:20,120 Speaker 3: for the last three or four years. I mean, you know, 157 00:06:20,200 --> 00:06:23,080 Speaker 3: our vision, or I think the administration's vision quite frankly, 158 00:06:23,080 --> 00:06:26,120 Speaker 3: it's very simple. They want to affect a slowdown in government. 159 00:06:26,320 --> 00:06:29,200 Speaker 3: They want to kind of liberate the private economy through 160 00:06:29,279 --> 00:06:31,640 Speaker 3: things like deregulation, keeping tax rates lower. 161 00:06:31,880 --> 00:06:33,760 Speaker 4: Maybe tarifts are part of that storyline. 162 00:06:33,800 --> 00:06:38,040 Speaker 3: Fine, and that transition from kind of public government allocation 163 00:06:38,120 --> 00:06:41,839 Speaker 3: of resources to private enterprise allocation of resources actually at 164 00:06:41,880 --> 00:06:45,159 Speaker 3: least atart broadening out something that's been absent really for 165 00:06:45,200 --> 00:06:46,680 Speaker 3: the last two or three or something. You know, we've 166 00:06:46,680 --> 00:06:50,240 Speaker 3: talked about here many times, this crowding out feature of 167 00:06:50,279 --> 00:06:53,560 Speaker 3: the government crowding out small businesses, crowding out the average consumer. 168 00:06:53,960 --> 00:06:56,000 Speaker 3: And look, I think they've been crystal clear in their 169 00:06:56,120 --> 00:06:58,680 Speaker 3: in their and sort of their messaging. It's not going 170 00:06:58,760 --> 00:07:01,640 Speaker 3: to be fun foreriod of time. Okay, we have to 171 00:07:01,880 --> 00:07:05,480 Speaker 3: sort of detox. As the Secretary Treasury mentioned, you know 172 00:07:05,600 --> 00:07:07,320 Speaker 3: that there's going to be an adjustment period, as a 173 00:07:07,360 --> 00:07:08,000 Speaker 3: president has said. 174 00:07:08,040 --> 00:07:09,480 Speaker 4: So it's been crystal clear what they've been. 175 00:07:09,360 --> 00:07:11,320 Speaker 5: Doing the whole Eat your vegetables, then get a dessert. 176 00:07:11,360 --> 00:07:13,480 Speaker 5: When it comes to dessert, we're only talking about current 177 00:07:13,520 --> 00:07:16,800 Speaker 5: policy extension. How exciting is that for the market if 178 00:07:16,840 --> 00:07:19,000 Speaker 5: you're just talking about an extension of TCJA. When it 179 00:07:19,040 --> 00:07:22,400 Speaker 5: comes to tax cuts and not actual additional tax cuts. 180 00:07:22,160 --> 00:07:23,040 Speaker 4: Well that's okay. 181 00:07:23,040 --> 00:07:25,080 Speaker 3: So what you're talking about is fiscal stimulus, and that's 182 00:07:25,080 --> 00:07:27,520 Speaker 3: what we have to detox from. So we don't need 183 00:07:27,560 --> 00:07:30,600 Speaker 3: more fiscal stimulus. We need less fiscal stimulus. We need 184 00:07:30,600 --> 00:07:34,000 Speaker 3: the private enterprise of America doing organic growth. 185 00:07:34,160 --> 00:07:37,280 Speaker 5: If taxes are going up on sales goods, don't need 186 00:07:37,320 --> 00:07:40,280 Speaker 5: more tax cuts for individual Well. 187 00:07:40,080 --> 00:07:42,880 Speaker 3: That's the idea, is that we're going to keep taxes lower, 188 00:07:42,880 --> 00:07:45,760 Speaker 3: maybe lower than further if tariffs A bring in revenue 189 00:07:45,760 --> 00:07:48,320 Speaker 3: and B there's a negotiating ploy so we'll see. I mean, 190 00:07:48,440 --> 00:07:51,000 Speaker 3: this is going to be very messy, and this is 191 00:07:51,040 --> 00:07:53,640 Speaker 3: not going to be easy transition. But John asks, what 192 00:07:53,840 --> 00:07:56,440 Speaker 3: is the bullet story you know over the next twelve months. 193 00:07:56,600 --> 00:07:58,800 Speaker 3: I think it's that, and it's going to be a 194 00:07:58,840 --> 00:08:01,840 Speaker 3: lot of uncertainty, but I still think that is the plan. 195 00:08:01,960 --> 00:08:04,280 Speaker 3: I still think what I see so far is a 196 00:08:04,440 --> 00:08:07,040 Speaker 3: is a direction in that in that manner, and looks 197 00:08:07,160 --> 00:08:10,040 Speaker 3: stock operators and financial market operators just gonna have to 198 00:08:10,080 --> 00:08:12,960 Speaker 3: deal with this adjustment. And that's that's what's the that's 199 00:08:13,000 --> 00:08:14,200 Speaker 3: the consternation right now. 200 00:08:14,320 --> 00:08:16,160 Speaker 2: We're attempting to deal with it right now. Marks good 201 00:08:16,160 --> 00:08:28,480 Speaker 2: to see it. So here's the laces. This morning, President 202 00:08:28,480 --> 00:08:31,080 Speaker 2: Donald Trump planning to stand his reciprocal tariff push on 203 00:08:31,360 --> 00:08:34,800 Speaker 2: all countries, Tempering hopes that the initial scope could be limited. 204 00:08:35,040 --> 00:08:37,920 Speaker 2: On Wednesday, hendrit Trace of Vada Pantas joins US right 205 00:08:37,960 --> 00:08:39,880 Speaker 2: now for more Henrietta, So let's start with the Triton 206 00:08:39,920 --> 00:08:40,520 Speaker 2: dollar question. 207 00:08:40,880 --> 00:08:42,840 Speaker 7: What happens on April second. 208 00:08:44,600 --> 00:08:47,520 Speaker 1: April second, at midnight, lots of tariffs start going on. 209 00:08:48,200 --> 00:08:49,920 Speaker 8: So it's going to be a really long day. We'll 210 00:08:49,920 --> 00:08:50,680 Speaker 8: obviously get. 211 00:08:50,520 --> 00:08:53,400 Speaker 1: The reports from USTR, Commerce and Treasury on the first. 212 00:08:53,640 --> 00:08:55,160 Speaker 1: I think there's going to be a lot of advanced 213 00:08:55,200 --> 00:08:57,400 Speaker 1: warning provided by those documents. You know, we have trade 214 00:08:57,440 --> 00:09:00,079 Speaker 1: agreements with twenty different countries, and I think when the 215 00:09:00,120 --> 00:09:02,120 Speaker 1: President says we're going to tear if everybody that we're 216 00:09:02,120 --> 00:09:03,959 Speaker 1: talking about, he means those twenty countries. 217 00:09:04,679 --> 00:09:06,679 Speaker 8: So I'm expecting to pull out. 218 00:09:06,559 --> 00:09:09,080 Speaker 1: Of the Phase one China deal or call them out 219 00:09:09,080 --> 00:09:11,880 Speaker 1: in violation of the deal, which means that all the 220 00:09:12,000 --> 00:09:14,679 Speaker 1: Section three oh one tariffs covering over three hundred and 221 00:09:14,679 --> 00:09:16,959 Speaker 1: fifty billion dollars worth of goods from China will go up. 222 00:09:17,240 --> 00:09:19,760 Speaker 1: I think we're going to see new tariff investigations start 223 00:09:19,840 --> 00:09:23,319 Speaker 1: on India, for example, pharmaceuticals I think there's going to 224 00:09:23,360 --> 00:09:26,160 Speaker 1: be new tariffs under Section two thirty two and AIPA 225 00:09:26,200 --> 00:09:27,400 Speaker 1: across the auto sector. 226 00:09:27,480 --> 00:09:29,360 Speaker 8: I'm very wary about auto parts. 227 00:09:29,520 --> 00:09:32,440 Speaker 1: I think that'll be sort of a secondary event that 228 00:09:32,480 --> 00:09:34,800 Speaker 1: happens in a couple months time. Should any of the 229 00:09:34,880 --> 00:09:36,760 Speaker 1: nations like the EU not come to the nego of 230 00:09:36,760 --> 00:09:37,920 Speaker 1: shooting table sufficiently. 231 00:09:38,720 --> 00:09:39,920 Speaker 8: It takes a long time to get through. 232 00:09:39,960 --> 00:09:42,600 Speaker 5: There's a lot coming, Henrietta, what do we see that 233 00:09:42,640 --> 00:09:45,920 Speaker 5: can happen almost immediately when it comes to AIPO or 234 00:09:45,920 --> 00:09:49,000 Speaker 5: three three eighth. Is that going to specific countries or 235 00:09:49,040 --> 00:09:50,400 Speaker 5: is that going to industries? 236 00:09:51,400 --> 00:09:54,040 Speaker 8: AIFA is specific countries and industries. 237 00:09:54,080 --> 00:09:57,560 Speaker 1: Although Section two thirty two, the National security justification is 238 00:09:57,600 --> 00:10:01,720 Speaker 1: really where a lot of the sector specific items go. Copper, dairy, 239 00:10:01,960 --> 00:10:05,400 Speaker 1: things along those lines'd be a Section two thirty two tariff. 240 00:10:05,760 --> 00:10:08,800 Speaker 1: My biggest concern with any rationale that's not AIPA or 241 00:10:08,800 --> 00:10:11,480 Speaker 1: even three thirty eight is that there's no time horizon 242 00:10:11,559 --> 00:10:13,880 Speaker 1: to take them off. The Section two thirty two tariffs 243 00:10:13,920 --> 00:10:15,719 Speaker 1: on steel and aluminium have been in effect. 244 00:10:15,480 --> 00:10:18,000 Speaker 8: For almost eight years. The Section three oh one tariffs 245 00:10:18,000 --> 00:10:18,920 Speaker 8: against China have been in. 246 00:10:18,920 --> 00:10:21,679 Speaker 1: Effect for almost eight years, So once those tariffs come 247 00:10:21,679 --> 00:10:24,720 Speaker 1: on with the rationale, like the Auto investigation that they 248 00:10:24,800 --> 00:10:27,760 Speaker 1: completed during Trump's first term. Those tariffs don't come off, 249 00:10:27,800 --> 00:10:30,400 Speaker 1: so those are the most pernicious. The AEPA pieces on 250 00:10:30,440 --> 00:10:33,360 Speaker 1: Canada and Mexico, for example, theoretically can come off in 251 00:10:33,400 --> 00:10:34,320 Speaker 1: three to six months. 252 00:10:34,520 --> 00:10:37,840 Speaker 8: The others have very serious standing power Henrietta. 253 00:10:37,880 --> 00:10:40,880 Speaker 5: When it comes to how the president is approaching Wednesday, 254 00:10:40,920 --> 00:10:43,720 Speaker 5: he said we're going to start with all countries. Is 255 00:10:43,760 --> 00:10:44,920 Speaker 5: that where he's going to end? 256 00:10:47,440 --> 00:10:48,760 Speaker 8: I think that's a fair question. 257 00:10:48,960 --> 00:10:51,200 Speaker 1: I think we start with about the twenty countries that 258 00:10:51,200 --> 00:10:54,120 Speaker 1: we have trade agreements with. That's what the agencies have 259 00:10:54,160 --> 00:10:57,360 Speaker 1: been tasked with doing. But I see the potential for 260 00:10:57,480 --> 00:11:00,440 Speaker 1: expansion before we see any pullbacks. So, for example, there's 261 00:11:00,520 --> 00:11:03,280 Speaker 1: no investigation into India. I mentioned that at the outset. 262 00:11:03,280 --> 00:11:04,800 Speaker 1: I think we have a lot of issues with India, 263 00:11:05,080 --> 00:11:10,440 Speaker 1: from trade in pharmaceuticals, genetic drugs to generic drug excuse me, 264 00:11:10,960 --> 00:11:12,600 Speaker 1: the trade and services deficit. 265 00:11:12,880 --> 00:11:13,720 Speaker 8: Those are all. 266 00:11:13,600 --> 00:11:16,480 Speaker 1: Sort of institutional issues that we know usdr Career had 267 00:11:16,559 --> 00:11:18,959 Speaker 1: during Trump's first term, and I would expect to see 268 00:11:19,000 --> 00:11:22,120 Speaker 1: a really long drag to any approach to India. So 269 00:11:22,160 --> 00:11:23,760 Speaker 1: I think a lot more are going to come on 270 00:11:24,040 --> 00:11:27,319 Speaker 1: in the next four years of Trump's term than necessarily 271 00:11:27,320 --> 00:11:30,320 Speaker 1: come off, although Canada and Mexico should be excluded, especially 272 00:11:30,400 --> 00:11:31,960 Speaker 1: USMC eight compliant pieces. 273 00:11:32,240 --> 00:11:35,640 Speaker 8: That trade deal needs to be reagreed to by next summer. 274 00:11:36,120 --> 00:11:37,960 Speaker 5: When it comes to what the Senate is also going 275 00:11:38,000 --> 00:11:39,680 Speaker 5: to do tomorrow, there's supposed to be a vote on 276 00:11:39,720 --> 00:11:43,560 Speaker 5: a Democratic resolution blocking Trump's use of AEPA when it 277 00:11:43,600 --> 00:11:46,120 Speaker 5: comes to Canada. How difficult is that going to be 278 00:11:46,120 --> 00:11:48,439 Speaker 5: for some Republicans, Whether or not they're going to say 279 00:11:48,520 --> 00:11:49,400 Speaker 5: yay or nay. 280 00:11:49,880 --> 00:11:50,840 Speaker 8: Well, just think about it. 281 00:11:50,840 --> 00:11:53,400 Speaker 1: There's already reporting that we're going to see a bailout 282 00:11:53,440 --> 00:11:57,880 Speaker 1: for the farmers, which is widely represented by Republican lawmakers 283 00:11:57,920 --> 00:12:01,599 Speaker 1: in the United States Senate, including the Majority leader John Thune. 284 00:12:01,760 --> 00:12:04,640 Speaker 1: I think it's fascinating to see tariffs go on our 285 00:12:04,679 --> 00:12:07,800 Speaker 1: closest trading partners, and Republicans who just for a couple 286 00:12:07,800 --> 00:12:09,480 Speaker 1: of years ago where a party of free trade and 287 00:12:09,600 --> 00:12:12,760 Speaker 1: zero percent tariffs, now have to get behind the President's 288 00:12:13,640 --> 00:12:19,720 Speaker 1: justification for fentanyl from Canada being an international economic emergency. 289 00:12:20,200 --> 00:12:22,960 Speaker 1: So you're going to see some serious backpedaling, which is 290 00:12:23,000 --> 00:12:27,880 Speaker 1: compounded by the election losses that Republicans are seeing across 291 00:12:27,920 --> 00:12:31,280 Speaker 1: the country, obviously with the Atlas Stephonics seat and upstate 292 00:12:31,320 --> 00:12:34,200 Speaker 1: New York, but just this past weekend on four amendments 293 00:12:34,200 --> 00:12:37,480 Speaker 1: in the deep red state of Louisiana, where Democratic voters 294 00:12:37,480 --> 00:12:40,240 Speaker 1: turned out after being sleepy for six years and crushed 295 00:12:40,280 --> 00:12:42,720 Speaker 1: four amendments. We're going to see that in Florida in 296 00:12:42,760 --> 00:12:45,920 Speaker 1: two different districts, the first and the sixth, to see 297 00:12:45,920 --> 00:12:48,040 Speaker 1: what the margins look like. Is it's still Trump plus 298 00:12:48,040 --> 00:12:51,000 Speaker 1: thirty plus forty or is it now something that Republicans 299 00:12:51,000 --> 00:12:52,840 Speaker 1: should be more concerned about going into the midterm. 300 00:12:52,840 --> 00:12:54,640 Speaker 8: It's a very big vote next tomorrow. 301 00:12:54,760 --> 00:12:57,120 Speaker 5: How much pressure Republicans under to make sure they get 302 00:12:57,200 --> 00:13:00,160 Speaker 5: TCGA extension done sooner rather than later. 303 00:13:00,920 --> 00:13:03,560 Speaker 1: Tons of pressure, it has to be done. I think 304 00:13:03,559 --> 00:13:05,760 Speaker 1: the best triggering mechanism is the. 305 00:13:06,080 --> 00:13:07,600 Speaker 8: X state for Treasury. 306 00:13:07,880 --> 00:13:11,400 Speaker 1: So we know that we've gotten estimates from outside advisors 307 00:13:11,400 --> 00:13:15,480 Speaker 1: and CBO that suggest late July to even mid October. 308 00:13:15,080 --> 00:13:15,920 Speaker 8: As the time horizon. 309 00:13:16,200 --> 00:13:18,320 Speaker 1: But all the staff on the hill you know, which 310 00:13:18,320 --> 00:13:20,720 Speaker 1: I used to be one, are making sure that we're 311 00:13:20,800 --> 00:13:23,440 Speaker 1: hearing from Treasury Secretary Bessett and he is not going 312 00:13:23,480 --> 00:13:24,600 Speaker 1: to report that date. 313 00:13:24,520 --> 00:13:26,720 Speaker 8: Until may, and it really is going to depend on 314 00:13:26,800 --> 00:13:27,520 Speaker 8: tax re seats. 315 00:13:27,640 --> 00:13:30,280 Speaker 1: So it's disconcerting when you see Doge going in and 316 00:13:30,320 --> 00:13:34,280 Speaker 1: firing IRS employees. It's expands the tax gap and that's 317 00:13:34,320 --> 00:13:36,360 Speaker 1: really what's going to determine what the X date is. 318 00:13:36,400 --> 00:13:38,800 Speaker 1: And that's I think the linking mechanism for passing this 319 00:13:38,880 --> 00:13:41,040 Speaker 1: tax bill, which as you pointed out before, is just 320 00:13:41,080 --> 00:13:42,240 Speaker 1: an extension of the status quo. 321 00:13:42,360 --> 00:13:44,199 Speaker 8: There are not and there will not be tax cuts 322 00:13:44,200 --> 00:13:44,640 Speaker 8: in this bill. 323 00:13:54,320 --> 00:13:57,640 Speaker 2: Darrel Kronk of wels Fango seeing tariffs having a measured impact. 324 00:13:57,760 --> 00:14:00,760 Speaker 2: Rising tariffs hurt the economy by complict kit and CAPEX 325 00:14:00,800 --> 00:14:04,080 Speaker 2: decisions about the future. But today the issue is mainly 326 00:14:04,120 --> 00:14:08,839 Speaker 2: price increases, which we foresee as incremental and dilute. Darrell 327 00:14:08,920 --> 00:14:11,000 Speaker 2: joins us now for more. Darren good Mornick and Morning John. 328 00:14:11,040 --> 00:14:12,679 Speaker 7: I have to say this the more constructive view from you. 329 00:14:12,920 --> 00:14:15,000 Speaker 7: What does that come from? What underpins that view? 330 00:14:15,360 --> 00:14:18,280 Speaker 9: Well, I think it's you know, obviously Wednesday will be big. 331 00:14:18,679 --> 00:14:21,000 Speaker 9: We're looking at it through kind of three lenses. One 332 00:14:21,120 --> 00:14:23,520 Speaker 9: is what is the universe? 333 00:14:23,640 --> 00:14:23,800 Speaker 6: Right? 334 00:14:23,840 --> 00:14:28,400 Speaker 9: So think tariffs are on imports themselves. I'm really focused 335 00:14:28,440 --> 00:14:31,640 Speaker 9: on things like the VAT as item too. Right, then 336 00:14:31,680 --> 00:14:35,520 Speaker 9: you've got non tariff subsidies things like you know, where 337 00:14:35,560 --> 00:14:37,760 Speaker 9: you subsidize an industry. And then you can also have 338 00:14:38,280 --> 00:14:41,760 Speaker 9: some noise around currency manipulators. Countries are labeled by Treasury 339 00:14:41,800 --> 00:14:43,640 Speaker 9: as currency manipulator or at least. 340 00:14:43,480 --> 00:14:44,400 Speaker 6: Put on watchlists. 341 00:14:44,440 --> 00:14:47,960 Speaker 9: Right, that universe will will break down between your universal 342 00:14:48,000 --> 00:14:50,360 Speaker 9: and sectoral And then I think what we really want 343 00:14:50,360 --> 00:14:53,680 Speaker 9: to focus on on Wednesday is what's known versus unknown? 344 00:14:53,800 --> 00:14:56,040 Speaker 6: Right, So we know the autos right at. 345 00:14:55,880 --> 00:14:59,440 Speaker 9: Twenty five percent, you know, imported autos and autoparts. We 346 00:14:59,520 --> 00:15:03,160 Speaker 9: know we're probably going to see the additional tariffs on 347 00:15:03,240 --> 00:15:06,320 Speaker 9: Venezuelan oil, right, and we know that there's going to 348 00:15:06,320 --> 00:15:10,000 Speaker 9: be some impact on Mexico and Canada, the USMCA coming 349 00:15:10,040 --> 00:15:12,680 Speaker 9: back maybe twenty five percent, maybe less. The key is 350 00:15:13,160 --> 00:15:16,200 Speaker 9: do we buy another kind of month of negotiation time 351 00:15:16,360 --> 00:15:20,760 Speaker 9: as the Treasury secretary to say escalate to de escalate, right, 352 00:15:20,800 --> 00:15:23,640 Speaker 9: and some room to negotiate, or do we just on 353 00:15:23,720 --> 00:15:26,160 Speaker 9: April second, let them have it right and kind of 354 00:15:26,400 --> 00:15:27,640 Speaker 9: implement those tariffs. 355 00:15:27,960 --> 00:15:30,160 Speaker 5: Do you think that it's going to be reciprocity for 356 00:15:30,200 --> 00:15:32,880 Speaker 5: each individual country or universal across the board. 357 00:15:34,120 --> 00:15:36,600 Speaker 9: I think it's country by country. I mean, I know 358 00:15:36,640 --> 00:15:39,360 Speaker 9: there was a lot of banter about universal over the 359 00:15:39,400 --> 00:15:41,320 Speaker 9: weekend and the. 360 00:15:41,400 --> 00:15:42,320 Speaker 8: Entire campaign trail. 361 00:15:42,600 --> 00:15:44,720 Speaker 9: I understand, and I think that's part of that escalate 362 00:15:44,760 --> 00:15:46,840 Speaker 9: to de escalate. It's trying to send kind of the 363 00:15:46,880 --> 00:15:50,000 Speaker 9: worst case message and scenario. But I think what the 364 00:15:50,040 --> 00:15:52,840 Speaker 9: President and the administration is really interested in doing is 365 00:15:52,920 --> 00:15:57,000 Speaker 9: negotiating country by country on very specific things like what 366 00:15:57,040 --> 00:16:01,320 Speaker 9: we still haven't seen is tariffs on pharmaceuticals. We haven't 367 00:16:01,320 --> 00:16:05,800 Speaker 9: seen tariffs on semiconductors. We haven't seen it on copper, timber, lumber. 368 00:16:06,120 --> 00:16:06,280 Speaker 6: Right. 369 00:16:06,320 --> 00:16:09,040 Speaker 9: A lot of those sectoral elements that people are talking 370 00:16:09,040 --> 00:16:12,200 Speaker 9: about are still forthcoming. So whether we get some of 371 00:16:12,200 --> 00:16:15,640 Speaker 9: that on Wednesday or not, I think is important. But 372 00:16:16,120 --> 00:16:18,520 Speaker 9: I don't know that i'd look for just broad based 373 00:16:18,640 --> 00:16:21,560 Speaker 9: universal tariffs. I think it's a it's a negotiation point country. 374 00:16:21,600 --> 00:16:24,960 Speaker 5: I think some countries say they have a massive export 375 00:16:25,080 --> 00:16:28,520 Speaker 5: of copper, they will face both, yes, so they will 376 00:16:28,520 --> 00:16:30,360 Speaker 5: be doubly tariff doubly taxed. 377 00:16:30,480 --> 00:16:30,720 Speaker 6: Yeah. 378 00:16:30,920 --> 00:16:33,920 Speaker 9: I think if you break down so very interested in 379 00:16:33,960 --> 00:16:36,520 Speaker 9: closing trade deficits. Right, if you look at the top 380 00:16:36,560 --> 00:16:39,160 Speaker 9: three trade deficits, China runs about a two hundred ninety 381 00:16:39,200 --> 00:16:42,120 Speaker 9: five billion dollars trade deficit number one, Mexico number two 382 00:16:42,120 --> 00:16:44,640 Speaker 9: at one hundred and seventy five billion, Vietnam number three 383 00:16:44,640 --> 00:16:46,280 Speaker 9: at one hundred and twenty five billion, right, and then 384 00:16:46,280 --> 00:16:48,720 Speaker 9: you go down. Actually, Canada's number eight on the list 385 00:16:48,720 --> 00:16:52,560 Speaker 9: of actual goods trade deficit. If you close that and 386 00:16:52,680 --> 00:16:55,440 Speaker 9: only close that at the same tariff rates as what 387 00:16:55,520 --> 00:16:58,200 Speaker 9: they charge us, it's about fifty billion dollars worth of tariffs. 388 00:16:58,600 --> 00:17:01,880 Speaker 9: If I add in the vat right, the value add attacks. 389 00:17:02,320 --> 00:17:04,879 Speaker 9: Now we're talking three x that number. It's about one 390 00:17:04,960 --> 00:17:08,440 Speaker 9: hundred and seventy billion dollars by our math, So that 391 00:17:08,560 --> 00:17:11,560 Speaker 9: that matters, I think in how they're going to play 392 00:17:11,560 --> 00:17:13,080 Speaker 9: this out in the coming week. 393 00:17:13,280 --> 00:17:15,679 Speaker 2: This is a relative game, but who wins who loses? 394 00:17:15,880 --> 00:17:18,479 Speaker 2: Relatively speaking? I think what's interesting about the call from 395 00:17:18,520 --> 00:17:20,159 Speaker 2: you and the team at wels Faranko at the moment 396 00:17:20,480 --> 00:17:22,360 Speaker 2: is you're sticking with the US economic leadership. 397 00:17:22,520 --> 00:17:23,960 Speaker 7: Yes, that's the theme for you. 398 00:17:23,880 --> 00:17:25,920 Speaker 2: Guys coming into the and you're staying with it as 399 00:17:25,960 --> 00:17:29,040 Speaker 2: other people change their forecasts. What's interesting about this morning 400 00:17:29,320 --> 00:17:31,200 Speaker 2: if you're just tuning into the program, yes, you'll see 401 00:17:31,200 --> 00:17:33,520 Speaker 2: equity futures down across the board, the S and P 402 00:17:33,640 --> 00:17:36,679 Speaker 2: down one percent, but check out Japan down four percent, 403 00:17:36,920 --> 00:17:39,800 Speaker 2: check out Germany down one point eight percent. Starting to 404 00:17:39,800 --> 00:17:41,560 Speaker 2: see and I know it's very early days, and we've 405 00:17:41,560 --> 00:17:43,840 Speaker 2: seen some massive outperformance in those parts of the world 406 00:17:44,119 --> 00:17:45,000 Speaker 2: over the year so far. 407 00:17:45,119 --> 00:17:46,760 Speaker 7: But thing's about to change. 408 00:17:47,359 --> 00:17:49,119 Speaker 9: Yeah, I think there's a lot of chasing that happened 409 00:17:49,119 --> 00:17:53,000 Speaker 9: earlier this quarter. Particularly let's pick on Europe for example, 410 00:17:53,080 --> 00:17:56,800 Speaker 9: and the German fiscal spend on defense and everything else. 411 00:17:57,640 --> 00:17:59,600 Speaker 6: If you go back since two thousand and. 412 00:17:59,520 --> 00:18:01,800 Speaker 9: Seven, So go back, you know, literally, you know, almost 413 00:18:01,840 --> 00:18:07,800 Speaker 9: twenty years, eighteen years the time period of sustained European 414 00:18:07,880 --> 00:18:10,359 Speaker 9: outperformance relative to the US. I threw a chart in 415 00:18:10,400 --> 00:18:13,639 Speaker 9: my notes today shows that it's on average about ninety 416 00:18:13,680 --> 00:18:15,720 Speaker 9: to one hundred and eighty days, and then it fades. 417 00:18:15,960 --> 00:18:19,919 Speaker 9: Why does it fade Because you need a sustained lower 418 00:18:19,960 --> 00:18:23,040 Speaker 9: dollar for that trade to work over any long period 419 00:18:23,040 --> 00:18:25,320 Speaker 9: of time, and you need earnings to deliver. 420 00:18:25,720 --> 00:18:25,880 Speaker 4: Right. 421 00:18:25,880 --> 00:18:27,560 Speaker 9: If I went back again to that same time period 422 00:18:27,560 --> 00:18:30,800 Speaker 9: and said, show me aggregate US S and P earnings 423 00:18:31,040 --> 00:18:33,840 Speaker 9: one hundred and seventy five percent, show me aggregate Euro 424 00:18:34,160 --> 00:18:39,240 Speaker 9: earnings seven that's the differential over that time aggregate right 425 00:18:39,320 --> 00:18:41,280 Speaker 9: of earnings growth. So if I don't get earnings growth 426 00:18:41,280 --> 00:18:43,520 Speaker 9: and I don't get a weeker dollar over any period 427 00:18:43,560 --> 00:18:46,199 Speaker 9: of time, that trade invariably fades on you. 428 00:18:46,400 --> 00:18:48,880 Speaker 2: So far this trade story has led to a wake 429 00:18:48,920 --> 00:18:51,560 Speaker 2: a dollar. Do you believe that reverses and why. 430 00:18:52,160 --> 00:18:54,240 Speaker 6: We think it stabilizes here? 431 00:18:54,400 --> 00:18:54,600 Speaker 4: Right? 432 00:18:54,680 --> 00:18:57,359 Speaker 9: So I would not look for, you know, the dixie 433 00:18:57,400 --> 00:19:00,440 Speaker 9: to go back to one ten across the broad batthkets. 434 00:19:00,600 --> 00:19:01,800 Speaker 6: But I do think you can have it go. 435 00:19:01,800 --> 00:19:03,280 Speaker 9: Back to kind of the one o six one oh 436 00:19:03,320 --> 00:19:06,680 Speaker 9: seven kind of range and just stabilize here. I wouldn't 437 00:19:06,680 --> 00:19:09,680 Speaker 9: look for you just continued week week week dollar, right, 438 00:19:09,720 --> 00:19:13,399 Speaker 9: And if and if we are that kind of flies 439 00:19:13,400 --> 00:19:16,480 Speaker 9: in the face of this growth scare, right, because obviously, 440 00:19:16,520 --> 00:19:18,280 Speaker 9: if you're going to get growth scare, what's going to happen? 441 00:19:18,600 --> 00:19:22,240 Speaker 9: Flight to quality, US treasuries, rally dollar rallies, right, all. 442 00:19:22,160 --> 00:19:24,480 Speaker 6: That stuff that just doesn't make a lot of sense 443 00:19:24,520 --> 00:19:24,840 Speaker 6: to us. 444 00:19:25,000 --> 00:19:28,080 Speaker 5: This administration do you think want a week dollar because 445 00:19:28,080 --> 00:19:31,440 Speaker 5: they want to see, you know, a rejuvenation of exports. 446 00:19:31,880 --> 00:19:34,639 Speaker 9: I think they're quintessentially the same as a lot of 447 00:19:34,680 --> 00:19:37,760 Speaker 9: administrations that that say they want a strong dollar. But 448 00:19:37,840 --> 00:19:39,960 Speaker 9: actually want a week dollar, right, because the week dollar 449 00:19:40,080 --> 00:19:43,040 Speaker 9: favors you know, economic growth to an extent, as long 450 00:19:43,040 --> 00:19:45,119 Speaker 9: as it's not a as long as it's not a 451 00:19:45,160 --> 00:19:47,480 Speaker 9: debasement of the currency or something like that. It's just 452 00:19:47,520 --> 00:19:49,880 Speaker 9: a sustained kind of steady weakness. 453 00:19:50,160 --> 00:19:51,000 Speaker 6: I think you can live with it. 454 00:19:51,160 --> 00:19:53,200 Speaker 9: I think what people miss here in the economic story 455 00:19:53,240 --> 00:19:54,720 Speaker 9: in the near term of US over some of the 456 00:19:54,720 --> 00:19:56,720 Speaker 9: other parts of the world is you do have rates 457 00:19:56,760 --> 00:19:59,439 Speaker 9: coming down. You do have the dollar that has come down, right, 458 00:19:59,560 --> 00:20:02,320 Speaker 9: Labor markets are still okay. You know, we're just about 459 00:20:02,320 --> 00:20:04,639 Speaker 9: ready to roll into Q two or Q wondering season. 460 00:20:04,680 --> 00:20:07,040 Speaker 9: Excuse me, right, you know today's the end. 461 00:20:06,960 --> 00:20:07,440 Speaker 6: Of the quarter. 462 00:20:07,600 --> 00:20:07,800 Speaker 7: Yep. 463 00:20:07,840 --> 00:20:09,639 Speaker 6: So we'll see what people say about earning. 464 00:20:09,720 --> 00:20:12,320 Speaker 2: Do you think we have reset expectations for earnings low enough? 465 00:20:12,560 --> 00:20:13,000 Speaker 6: Not yet. 466 00:20:13,720 --> 00:20:15,600 Speaker 9: I still think that has to come. And I think 467 00:20:15,840 --> 00:20:18,919 Speaker 9: what happens is whether it's consumer spending. If you look 468 00:20:18,920 --> 00:20:21,840 Speaker 9: at the drivers of what's been the growth drivers in 469 00:20:21,880 --> 00:20:25,680 Speaker 9: the US economy, it's AI cap X, it's the high 470 00:20:25,720 --> 00:20:28,920 Speaker 9: end consumer, consumer spending broadly, but particularly the high end consumer, 471 00:20:29,040 --> 00:20:30,280 Speaker 9: and it's the fiscal impulse. 472 00:20:30,640 --> 00:20:31,160 Speaker 6: Right. 473 00:20:31,280 --> 00:20:34,119 Speaker 9: So if I lose those engines, right, am I am 474 00:20:34,119 --> 00:20:37,000 Speaker 9: I losing AI cap X, am I losing the high 475 00:20:37,080 --> 00:20:39,240 Speaker 9: end consumer, am I losing some of. 476 00:20:39,240 --> 00:20:40,240 Speaker 6: The fiscal impulse? 477 00:20:40,440 --> 00:20:40,680 Speaker 4: Right? 478 00:20:40,920 --> 00:20:41,840 Speaker 6: Something else has to. 479 00:20:41,760 --> 00:20:44,800 Speaker 9: Step into that void at this point, right, which means 480 00:20:44,880 --> 00:20:46,760 Speaker 9: that growth is going to be a neema care for 481 00:20:46,760 --> 00:20:48,879 Speaker 9: a while, and it's going to be hard to generate a. 482 00:20:48,960 --> 00:20:51,320 Speaker 2: Question marks I've roll three, Yes, which one of those 483 00:20:51,359 --> 00:20:53,359 Speaker 2: engines are you most concerned about right now? Because the 484 00:20:53,359 --> 00:20:54,920 Speaker 2: one that I don't think it's talked enough about is 485 00:20:54,960 --> 00:20:57,840 Speaker 2: the AI story. We're all obsessing over to trade headlines, 486 00:20:57,840 --> 00:20:59,639 Speaker 2: but over the past few weeks we've had some pretty 487 00:20:59,680 --> 00:21:02,399 Speaker 2: damage headlines for that part of the market, and it's 488 00:21:02,400 --> 00:21:04,440 Speaker 2: an important part of the equity market. 489 00:21:04,680 --> 00:21:07,159 Speaker 9: Yeah, if you take the top ten names obviously in 490 00:21:07,160 --> 00:21:08,960 Speaker 9: the S and P five hundred, they still account for 491 00:21:09,119 --> 00:21:12,400 Speaker 9: fifty percent of the net income growth in the index. 492 00:21:12,600 --> 00:21:15,360 Speaker 9: Fifty percent, right, I mean talk about the skew right 493 00:21:15,400 --> 00:21:17,479 Speaker 9: and lack of breadth that we've talked about many times. 494 00:21:17,840 --> 00:21:21,320 Speaker 9: So obviously the broadening out of that what's not discussed, John, 495 00:21:21,440 --> 00:21:23,520 Speaker 9: is so we're going to probably put at the end 496 00:21:23,560 --> 00:21:26,960 Speaker 9: of today one of the weakest quarters as a whole 497 00:21:27,040 --> 00:21:33,359 Speaker 9: for technology as a sector in probably thirty to forty years. 498 00:21:33,400 --> 00:21:33,600 Speaker 4: Right. 499 00:21:34,880 --> 00:21:36,080 Speaker 6: Energy's up seven percent. 500 00:21:36,560 --> 00:21:36,760 Speaker 4: Right. 501 00:21:37,080 --> 00:21:40,359 Speaker 9: Financials and comm services on a relative basis are doing 502 00:21:40,440 --> 00:21:42,920 Speaker 9: quite well, right compared to the endscy and everything else. 503 00:21:43,119 --> 00:21:46,320 Speaker 9: It's really centered in tech and consumer discretionary right. 504 00:21:46,720 --> 00:21:48,679 Speaker 6: So I agree with you on the AI cap X. 505 00:21:49,280 --> 00:21:52,000 Speaker 9: I'll tell you what though, I watch very very closely 506 00:21:52,040 --> 00:21:54,720 Speaker 9: that high end consumer, actually high end consumer spending and 507 00:21:54,760 --> 00:21:58,800 Speaker 9: expectations now have dipped below the middle quintile tiers, right, 508 00:21:58,880 --> 00:22:04,520 Speaker 9: So it's hooking harder than even the low and middle quintile. 509 00:22:04,640 --> 00:22:07,720 Speaker 9: So that's where your discretionary spend comes from. And the 510 00:22:07,800 --> 00:22:11,040 Speaker 9: question isnt are they able to spend? They're still able 511 00:22:11,080 --> 00:22:12,760 Speaker 9: to spend, it's just are they willing to spend? 512 00:22:13,160 --> 00:22:15,200 Speaker 2: That's the big question going into NX season. I've got 513 00:22:15,200 --> 00:22:16,400 Speaker 2: some good news. Bonds are working. 514 00:22:16,640 --> 00:22:16,840 Speaker 6: Yes. 515 00:22:16,960 --> 00:22:20,359 Speaker 2: This has been the allocatus dilemma over the past few weeks, 516 00:22:20,359 --> 00:22:22,840 Speaker 2: and we said repeatedly on this program on down days 517 00:22:22,880 --> 00:22:25,840 Speaker 2: in the equity market, bonds haven't behaved in predictable ways. 518 00:22:25,960 --> 00:22:27,600 Speaker 2: Sometimes you use it up, sometimes you havese it down. 519 00:22:27,600 --> 00:22:29,840 Speaker 2: They're down this morning by six bass points. Can you 520 00:22:29,880 --> 00:22:31,480 Speaker 2: depend on that in the year ahead? 521 00:22:32,760 --> 00:22:35,439 Speaker 9: I don't think so, because I think What happens is 522 00:22:35,760 --> 00:22:38,720 Speaker 9: eventually we get a little bit past this growth scare 523 00:22:38,760 --> 00:22:41,479 Speaker 9: in the near term, and we really the inflation narrative 524 00:22:41,480 --> 00:22:43,439 Speaker 9: really starts to come back to the table. So when 525 00:22:43,480 --> 00:22:44,880 Speaker 9: you look at the long side of the curve, it's 526 00:22:44,920 --> 00:22:47,000 Speaker 9: really three premiums. Right, It's a term premium, it's a 527 00:22:47,000 --> 00:22:48,760 Speaker 9: growth premium, and it's an inflation premium. 528 00:22:48,840 --> 00:22:49,040 Speaker 6: Right. 529 00:22:49,440 --> 00:22:52,800 Speaker 9: So if I hold term premium even I bring growth 530 00:22:52,800 --> 00:22:55,240 Speaker 9: premium down a little bit also equal. That's what's driving 531 00:22:55,280 --> 00:22:58,760 Speaker 9: alongside of the of the curve down. But I'm pushing 532 00:22:58,840 --> 00:23:02,800 Speaker 9: up on inflation expectations and premiums in that longside. 533 00:23:02,960 --> 00:23:05,520 Speaker 6: The question is which one wins the day? Right? Does 534 00:23:05,600 --> 00:23:06,719 Speaker 6: the growth scare carry the day? 535 00:23:06,720 --> 00:23:10,320 Speaker 9: And that's why you see the kind of dilemma that happens. 536 00:23:10,560 --> 00:23:12,400 Speaker 9: If it's a particular day where a piece of economic 537 00:23:12,480 --> 00:23:14,040 Speaker 9: data suggests the growth scare is. 538 00:23:14,600 --> 00:23:17,240 Speaker 6: A problem, right, you get a flight to quality rates. 539 00:23:16,960 --> 00:23:19,760 Speaker 9: Down, right, you get a bad inflation reading like we got, 540 00:23:19,920 --> 00:23:21,640 Speaker 9: although it wasn't bad, but you know, a little higher 541 00:23:21,680 --> 00:23:25,360 Speaker 9: inflation reading last week, right, two point eight percent on inflation. 542 00:23:25,640 --> 00:23:27,480 Speaker 6: All of a sudden, you know, rates move higher. 543 00:23:28,280 --> 00:23:40,800 Speaker 2: Tara Krunk Flas Fanca Don Murphy of Banks for American writing. 544 00:23:40,920 --> 00:23:44,800 Speaker 2: Vehicle prices could increase as much as ten thousand dollars 545 00:23:45,040 --> 00:23:47,560 Speaker 2: if automakers pass on the tariffs in full. 546 00:23:47,760 --> 00:23:49,640 Speaker 7: John joins us now for more. It's good to see, 547 00:23:50,119 --> 00:23:50,959 Speaker 7: it's good, good to see here. 548 00:23:50,960 --> 00:23:51,199 Speaker 4: I'm look. 549 00:23:51,400 --> 00:23:53,320 Speaker 2: I'm sure you're exhausted, so thanks for being with us. 550 00:23:53,520 --> 00:23:55,280 Speaker 6: Yes, I'm very exhausted. It's a lot going on. 551 00:23:55,200 --> 00:23:56,520 Speaker 2: And you're going to have be exhausted this way. So 552 00:23:56,760 --> 00:23:59,000 Speaker 2: let's start with the tariffs. Twenty five percent, how much 553 00:23:59,040 --> 00:24:00,840 Speaker 2: we passed through and the same expected. 554 00:24:01,359 --> 00:24:03,439 Speaker 10: Well, I mean, it's really unclear, like you kind of 555 00:24:03,480 --> 00:24:06,840 Speaker 10: let in there ten thousand bucks on imported autos as 556 00:24:06,880 --> 00:24:10,320 Speaker 10: someone elsewhere outside of the US would be subject to 557 00:24:10,320 --> 00:24:12,280 Speaker 10: potentially as much as ten thousand if they decided to 558 00:24:12,280 --> 00:24:15,520 Speaker 10: pass if passed through the tariffs completely, if they decide 559 00:24:15,560 --> 00:24:18,160 Speaker 10: to break even in the interim, right they make a decision, listen, 560 00:24:18,200 --> 00:24:19,760 Speaker 10: we're going to keep making vehicles. We're going to try 561 00:24:19,800 --> 00:24:22,280 Speaker 10: to maintain our market share. They may pass through about 562 00:24:22,280 --> 00:24:25,720 Speaker 10: forty five hundred bucks, or if they do something, you know, 563 00:24:26,000 --> 00:24:28,960 Speaker 10: even more extreme, they might decide, listen, we're not gonna 564 00:24:28,960 --> 00:24:30,760 Speaker 10: be able to make money on these vehicles, we're not 565 00:24:30,800 --> 00:24:32,520 Speaker 10: going to import any and we've got risk of the 566 00:24:32,520 --> 00:24:34,760 Speaker 10: seven point six million vehicles that are imported to the 567 00:24:34,840 --> 00:24:37,960 Speaker 10: United States potentially being at risk. So there's a lot 568 00:24:38,000 --> 00:24:40,119 Speaker 10: of layers of how this kid get passed through and 569 00:24:40,160 --> 00:24:41,080 Speaker 10: the impact on sales. 570 00:24:41,160 --> 00:24:43,920 Speaker 7: The management seems imagine outstanding. Still, I'm sure that you've 571 00:24:43,920 --> 00:24:45,480 Speaker 7: been in touch with many of them over the past 572 00:24:45,520 --> 00:24:46,040 Speaker 7: week or so. 573 00:24:46,320 --> 00:24:50,199 Speaker 2: Stillansis for GM, Tesla, Tesla limited impact here of the 574 00:24:50,320 --> 00:24:52,920 Speaker 2: other three, how are they preparing for Thursday? 575 00:24:52,920 --> 00:24:54,080 Speaker 7: What do they do well? 576 00:24:54,160 --> 00:24:55,960 Speaker 10: I mean, I think we've got the answers for the 577 00:24:55,960 --> 00:24:58,320 Speaker 10: moment for Thursday. We don't necessarily have the answers for 578 00:24:58,400 --> 00:25:02,639 Speaker 10: Friday or the follower week yet. So the volatility in 579 00:25:02,720 --> 00:25:04,600 Speaker 10: the in sort of what's going to happen here or 580 00:25:04,640 --> 00:25:07,240 Speaker 10: the uncertainty is pretty extreme. And I think when you 581 00:25:07,240 --> 00:25:10,600 Speaker 10: look at this, you're making a product and plant decision 582 00:25:10,760 --> 00:25:13,760 Speaker 10: about three to four years out, and then you're going 583 00:25:13,800 --> 00:25:16,640 Speaker 10: to live with that for about seven years out from 584 00:25:16,640 --> 00:25:19,439 Speaker 10: that as the product is launched in the market and produced, 585 00:25:19,480 --> 00:25:22,199 Speaker 10: so you have a ten plus year window of committing capital. 586 00:25:22,200 --> 00:25:24,840 Speaker 10: So it's very difficult on a weekly, monthly or an 587 00:25:24,840 --> 00:25:27,080 Speaker 10: even annual basis for them to make very significant shifts. 588 00:25:27,080 --> 00:25:28,760 Speaker 10: So I think at the moment they're going to look 589 00:25:28,760 --> 00:25:31,080 Speaker 10: at increasing some employment here in the US, trying to 590 00:25:31,160 --> 00:25:33,720 Speaker 10: ramp up the utilization of their plants here. 591 00:25:33,480 --> 00:25:34,800 Speaker 6: In the US to offset this. 592 00:25:35,560 --> 00:25:38,439 Speaker 10: But from a large degree, they're not actually doing anything 593 00:25:38,560 --> 00:25:39,960 Speaker 10: just yet because they don't know the rules of the 594 00:25:39,960 --> 00:25:41,760 Speaker 10: game and they're long term capital allocators. 595 00:25:41,800 --> 00:25:43,800 Speaker 6: Who's best positioned going into Wednesday. 596 00:25:44,600 --> 00:25:46,800 Speaker 10: So I think if you look at Tesla, Lucid, Arrivian, 597 00:25:46,840 --> 00:25:49,600 Speaker 10: the startup ev names here in the US, they basically 598 00:25:49,680 --> 00:25:52,000 Speaker 10: are are largely unexposed except for some of the electronic 599 00:25:52,040 --> 00:25:55,200 Speaker 10: components that they would import. Ford is actually in pretty 600 00:25:55,240 --> 00:25:57,480 Speaker 10: good a pretty good position. They're only importing twenty percent 601 00:25:57,480 --> 00:26:00,680 Speaker 10: of their volume or vehicle volume in the US, and 602 00:26:00,720 --> 00:26:02,560 Speaker 10: none of that is really the big ticket items like 603 00:26:02,600 --> 00:26:06,680 Speaker 10: the Expedition Navigator F one fifty or even super duties. 604 00:26:07,119 --> 00:26:08,800 Speaker 10: But you go down the list, GM is about fifty 605 00:26:08,880 --> 00:26:12,679 Speaker 10: fifty to fifty imports domestic to the US. But then 606 00:26:12,680 --> 00:26:16,199 Speaker 10: you have companies like Nissan, you know, Mazda, Subaru, some 607 00:26:16,240 --> 00:26:19,080 Speaker 10: of the other names that are reasonably well, reasonably exposed, 608 00:26:19,080 --> 00:26:21,720 Speaker 10: and I think there's a lot of sort of mid 609 00:26:21,760 --> 00:26:23,679 Speaker 10: to long term sort of game theory you have to 610 00:26:23,680 --> 00:26:25,399 Speaker 10: play here of where the market will go. And I 611 00:26:25,440 --> 00:26:28,560 Speaker 10: think most of these manufacturers are going to produce higher end, 612 00:26:29,040 --> 00:26:32,840 Speaker 10: higher mixed vehicles to try to offset this incremental costs. 613 00:26:33,080 --> 00:26:35,680 Speaker 10: And I think that's really important to recognize the low 614 00:26:35,760 --> 00:26:38,320 Speaker 10: end consumer is not going to be served, so basic 615 00:26:38,359 --> 00:26:41,520 Speaker 10: transportation is going to be less available to the American consumer, 616 00:26:41,560 --> 00:26:43,600 Speaker 10: and if it's available, it's at a higher price. I 617 00:26:43,680 --> 00:26:45,480 Speaker 10: think the real long term thing to think here is 618 00:26:45,520 --> 00:26:48,399 Speaker 10: this is the door opening to the Chinese at the 619 00:26:48,560 --> 00:26:53,360 Speaker 10: entry level and potentially coming here and building plants, employing Americans, 620 00:26:53,520 --> 00:26:56,640 Speaker 10: potentially bringing their entire supply chain here and entering at 621 00:26:56,640 --> 00:26:58,080 Speaker 10: the low And I think if you sort of run 622 00:26:58,119 --> 00:26:59,520 Speaker 10: this forward a couple of years, that's the thing we 623 00:26:59,560 --> 00:27:00,480 Speaker 10: really need to think about. 624 00:27:00,560 --> 00:27:04,040 Speaker 5: Are you basically talking about the Chinese companies doing what 625 00:27:04,160 --> 00:27:06,840 Speaker 5: Japanese companies did two three decades ago. 626 00:27:07,160 --> 00:27:07,480 Speaker 6: Correct. 627 00:27:07,520 --> 00:27:09,399 Speaker 10: We saw the Japanese do it in the seventies and eighties, 628 00:27:09,440 --> 00:27:11,159 Speaker 10: We saw the Koreans do it eighties and nineties. It 629 00:27:11,200 --> 00:27:12,919 Speaker 10: takes ten to twenty years once you're here in the 630 00:27:13,000 --> 00:27:16,119 Speaker 10: US market actually really gain a foothold. But I think 631 00:27:16,160 --> 00:27:18,199 Speaker 10: that's probably what we're We're staring down the barrel of 632 00:27:18,280 --> 00:27:19,600 Speaker 10: if this holds, so. 633 00:27:19,600 --> 00:27:21,639 Speaker 2: The price war already starts, it s implements. Take a 634 00:27:21,640 --> 00:27:23,240 Speaker 2: big step back here and think about what the last 635 00:27:23,280 --> 00:27:25,640 Speaker 2: two years looked like. We were talking about a real 636 00:27:25,680 --> 00:27:28,800 Speaker 2: price war in China. We were talking about automakers cutting 637 00:27:28,920 --> 00:27:32,199 Speaker 2: prices because the demand wasn't there. So when the President 638 00:27:32,200 --> 00:27:33,760 Speaker 2: comes out and says things like, I don't care if 639 00:27:33,800 --> 00:27:37,080 Speaker 2: they raised prices, is the consumer price tolerance even there 640 00:27:37,160 --> 00:27:39,760 Speaker 2: in this economy for them to raise prices. 641 00:27:39,800 --> 00:27:42,520 Speaker 10: Well, we're already drifting off of all time highs in 642 00:27:42,560 --> 00:27:44,479 Speaker 10: autopricing over the last couple of years. So I think 643 00:27:44,520 --> 00:27:46,320 Speaker 10: if we were to look at this and really spread 644 00:27:46,400 --> 00:27:48,840 Speaker 10: everything that we know right now as best we can, 645 00:27:48,960 --> 00:27:51,600 Speaker 10: we're talking about a five to fifteen percent on average 646 00:27:51,600 --> 00:27:52,800 Speaker 10: price increase in vehicles. 647 00:27:52,880 --> 00:27:53,760 Speaker 6: The consumer is not. 648 00:27:53,760 --> 00:27:55,360 Speaker 10: Really there for that, so that would have a very 649 00:27:55,359 --> 00:27:57,800 Speaker 10: significant impact. We kind of roughly were assuming it's a 650 00:27:57,800 --> 00:27:59,720 Speaker 10: two and a half to three million unit hit to 651 00:27:59,760 --> 00:28:02,679 Speaker 10: saw are just based on price pass throughs, right so 652 00:28:02,680 --> 00:28:04,639 Speaker 10: that's you know, that's a pretty big hit to the market. 653 00:28:04,640 --> 00:28:06,560 Speaker 10: That's about sixteen million units right now. 654 00:28:06,760 --> 00:28:08,440 Speaker 6: I'd have to go back tomorrow. What the President said 655 00:28:08,440 --> 00:28:09,000 Speaker 6: over the weekend. 656 00:28:09,040 --> 00:28:11,360 Speaker 5: To Jonathan's point, he's talking about I couldn't care if 657 00:28:11,400 --> 00:28:14,119 Speaker 5: these automakers raise prices. He said that then they're going 658 00:28:14,200 --> 00:28:17,440 Speaker 5: to start buying American cars. The number one car being 659 00:28:17,440 --> 00:28:19,600 Speaker 5: sold right now in America is a Toyota Wrap four, 660 00:28:19,880 --> 00:28:22,919 Speaker 5: but it's produced in America. So say, would Toyota get 661 00:28:23,000 --> 00:28:24,400 Speaker 5: exemption our carve out? 662 00:28:24,920 --> 00:28:26,680 Speaker 10: Well, I think that Wrap four would be wouldn't be 663 00:28:26,720 --> 00:28:29,200 Speaker 10: tariff save maybe the power train and electronic components that 664 00:28:29,359 --> 00:28:31,360 Speaker 10: are that are in it that might that might be imported. 665 00:28:31,600 --> 00:28:33,080 Speaker 10: We have to kind of dig through that, and everybody's 666 00:28:33,080 --> 00:28:35,359 Speaker 10: still digging, digging through this. So yes, it might be 667 00:28:35,440 --> 00:28:38,120 Speaker 10: non US companies, but it would be US workers that 668 00:28:38,160 --> 00:28:40,400 Speaker 10: would benefit. And I think that's kind of the ultimate endgame. 669 00:28:40,400 --> 00:28:41,920 Speaker 10: I mean, our rough estimate is you could have one 670 00:28:42,000 --> 00:28:44,840 Speaker 10: hundred and five thousand direct jobs if you brought all 671 00:28:44,880 --> 00:28:47,680 Speaker 10: that seven point six million units of production or demand 672 00:28:47,720 --> 00:28:50,720 Speaker 10: slash production back to the US, create another sort of 673 00:28:50,760 --> 00:28:54,000 Speaker 10: almost a million in sort of another million indirect jobs. 674 00:28:54,040 --> 00:28:55,760 Speaker 6: So there's a big focus on. 675 00:28:55,720 --> 00:28:58,760 Speaker 10: Creating jobs, but there's greater greater automation at the plant level, 676 00:28:58,920 --> 00:29:01,080 Speaker 10: So will that actually be sort of a net job 677 00:29:01,160 --> 00:29:04,240 Speaker 10: gain or will it just be bringing that manufacturing back 678 00:29:04,280 --> 00:29:04,960 Speaker 10: here to the US. 679 00:29:05,200 --> 00:29:07,480 Speaker 5: You mentioned when it comes to the American producers forwards 680 00:29:07,560 --> 00:29:10,880 Speaker 5: in maybe more decent shape than GM. The issue at 681 00:29:10,960 --> 00:29:14,240 Speaker 5: GM is their foreign components are Canada and Mexico. Will 682 00:29:14,240 --> 00:29:18,160 Speaker 5: there be a USMCA carve out for these autos? 683 00:29:18,240 --> 00:29:19,160 Speaker 7: Do we know yet? 684 00:29:19,360 --> 00:29:19,440 Speaker 1: So? 685 00:29:19,640 --> 00:29:22,640 Speaker 10: Right now what we know is on parts that are 686 00:29:22,680 --> 00:29:26,920 Speaker 10: imported from Canada and Mexico, as long as their USMCA 687 00:29:27,000 --> 00:29:31,920 Speaker 10: compliant basically seventy five percent of their content is North American. 688 00:29:32,360 --> 00:29:36,360 Speaker 10: That the percentage of the components that are of the 689 00:29:36,400 --> 00:29:39,520 Speaker 10: subcomponents that are produced in the US wouldn't be tariffed. 690 00:29:40,120 --> 00:29:42,760 Speaker 10: Going through that right now is sort of my numbing. 691 00:29:42,800 --> 00:29:46,200 Speaker 10: Nobody actually has the exact answer on that at at 692 00:29:46,240 --> 00:29:48,120 Speaker 10: the supplier level, the folks that are actually doing this, 693 00:29:48,480 --> 00:29:50,720 Speaker 10: and that's why we have a tape delay on the 694 00:29:50,760 --> 00:29:53,840 Speaker 10: tariffs being put on USMCA compliant components. 695 00:29:54,040 --> 00:29:56,640 Speaker 2: This wasn't my numbing, This was ready thoughtful. John Murphy 696 00:29:56,680 --> 00:29:58,360 Speaker 2: of Banks of America want the future of this CAINR 697 00:29:58,360 --> 00:30:03,160 Speaker 2: industry in this country. This is the Bloomberg Surveillance Podcast 698 00:30:03,280 --> 00:30:07,200 Speaker 2: bringing you the best in markets, economics, and geopolitics. You 699 00:30:07,240 --> 00:30:10,000 Speaker 2: can watch the show live on Bloomberg TV weekday mornings 700 00:30:10,000 --> 00:30:12,960 Speaker 2: from six am to nine am Eastern. Subscribe to the 701 00:30:12,960 --> 00:30:16,480 Speaker 2: podcast on Apple, Spotify, or anywhere else you listen, and, 702 00:30:16,520 --> 00:30:19,600 Speaker 2: as always, on the Bloomberg Terminal and the Bloomberg Business app.