WEBVTT - U.S-China Trade, Amazon, Future of Open Source 0:00:02.640 --> 0:00:05.320 Welcome to the Bloomberg Penel Podcast. I'm Paul swing you, 0:00:05.360 --> 0:00:07.680 along with my co host Lisa Brahma wits each day 0:00:07.720 --> 0:00:10.240 we bring you the most noteworthy and useful interviews for 0:00:10.280 --> 0:00:12.520 you and your money, whether at the grocery store or 0:00:12.560 --> 0:00:15.480 the trading floor. Find a Bloomberg Penil podcast on Apple 0:00:15.520 --> 0:00:17.959 Podcast or wherever you listen to podcasts, as well as 0:00:17.960 --> 0:00:23.279 at Bloomberg dot com. Well, the Chinese trade delegation is 0:00:23.320 --> 0:00:25.640 in Washington, d C. They are meeting with the US 0:00:25.720 --> 0:00:30.360 delegation today and tomorrow. President Trump just tweeted out that 0:00:30.400 --> 0:00:33.960 he will meet with Vice Premier Leo hey Uh tomorrow, 0:00:34.080 --> 0:00:35.960 suggesting that there may be some light at the end 0:00:36.000 --> 0:00:38.199 of this trade tunnel. To get the latest, there is 0:00:38.240 --> 0:00:41.440 absolutely nobody better to speak to than Leland Miller. He 0:00:41.520 --> 0:00:44.320 is the CEO of the China Basebook International Uh. He 0:00:44.400 --> 0:00:46.960 joins us here on a Bloomberg Interactor Broker studio. So, Leland, 0:00:46.960 --> 0:00:48.440 thanks so much for joining us on what could be 0:00:48.479 --> 0:00:51.640 a very very important two days for the US and 0:00:51.840 --> 0:00:55.680 China and the overall financial markets. What is your sense 0:00:56.040 --> 0:00:58.840 of what would be a success here over the next 0:00:58.840 --> 0:01:02.320 couple of days. I think expectations have been peeled back 0:01:02.480 --> 0:01:05.920 dramatically over the last twelve to twenty four hours simply 0:01:05.959 --> 0:01:07.760 because there's been a lot of bad news. I mean, 0:01:07.800 --> 0:01:11.280 earlier this week you saw sanctions against Chinese companies and 0:01:11.360 --> 0:01:14.679 visa restrictions on Chinese individuals. Uh. And then you know 0:01:14.840 --> 0:01:17.480 the threat that Chinese we're gonna leave early, and and 0:01:17.480 --> 0:01:19.720 and so it's been nothing but bad news. But look 0:01:19.800 --> 0:01:22.560 that a lot of what's happening with the administration on 0:01:22.640 --> 0:01:25.480 China is getting more aggressive. On the other hand, they 0:01:25.560 --> 0:01:29.399 still have a desire to reach a deal on trade, 0:01:29.760 --> 0:01:33.600 a medium mini deal on trade in twenty nineteen. If 0:01:33.640 --> 0:01:35.680 they can get what they want, which means more than 0:01:35.680 --> 0:01:38.319 agg purchases. That they need the Chinese to start delivering 0:01:38.640 --> 0:01:41.199 on some of the substantive commitments from the May text. 0:01:41.880 --> 0:01:45.280 But that's where this is going, tariff punts and pullbacks 0:01:45.319 --> 0:01:48.880 and return for some substitive concessions and some abus. Here's 0:01:48.880 --> 0:01:50.920 the reason why there's a lot of confusion right now. 0:01:51.080 --> 0:01:54.400 We're getting mixed messages. On one hand, it seems like 0:01:55.040 --> 0:01:58.320 the US is kind of drilling down and trying to 0:01:58.360 --> 0:02:02.120 get some serious concessions uh and and going after even 0:02:02.160 --> 0:02:04.520 just the investment the flows of capital from the US 0:02:04.640 --> 0:02:06.920 into China. And on the other hand, it looks like 0:02:07.160 --> 0:02:11.320 we're more amenable to some sort of agricultural deal. What 0:02:11.360 --> 0:02:13.799 do we make of this sort of push pull, Well, 0:02:13.840 --> 0:02:16.399 there really are two tracks that are forming with an administration. 0:02:16.480 --> 0:02:18.440 This has always been true, but I think right now 0:02:18.480 --> 0:02:20.399 what you're seeing is that people focused on the national 0:02:20.440 --> 0:02:23.800 security side are really digging in and getting more aggressive. 0:02:23.840 --> 0:02:28.920 And you are seeing more um more moves against Chinese 0:02:28.960 --> 0:02:32.240 companies and against Chinese individuals, and and you are also 0:02:32.360 --> 0:02:36.600 seeing um things that on the pension money side, US 0:02:36.639 --> 0:02:39.080 gunment pension money is being looked at very closely in 0:02:39.120 --> 0:02:41.000 terms of how to wool that away from going into 0:02:41.080 --> 0:02:43.880 Chinese companies and and then into the into the p 0:02:44.000 --> 0:02:46.160 l A as they would as they would say um. 0:02:46.200 --> 0:02:48.239 On the other hand, trade is being handled a little 0:02:48.240 --> 0:02:50.840 bit differently, and there is a belief within the White 0:02:50.840 --> 0:02:55.600 House that the best case scenario for President Trump and 0:02:55.639 --> 0:02:58.919 his re election is to scale the terrorifts back to 0:02:58.919 --> 0:03:01.960 to sort of cruise through at two or fifty billion 0:03:01.960 --> 0:03:03.880 if they can do that, so putting a lot of 0:03:03.880 --> 0:03:06.600 pressure on the Chinese, but not too much pressure to 0:03:06.680 --> 0:03:09.280 hurt the U s economy. Getting those agg buys in return, 0:03:09.560 --> 0:03:11.799 and that's the sweet spot. It doesn't mean they can 0:03:11.840 --> 0:03:13.840 get that. They're not just going to give that away, 0:03:13.919 --> 0:03:15.880 but that's what they're angling for. If they can get 0:03:15.919 --> 0:03:19.280 some substantive concessions back from the Chinese. Well, I think 0:03:19.360 --> 0:03:21.720 the one of the issues is October and the tariffs, 0:03:21.720 --> 0:03:24.720 so they're scheduled to go up again. Is that something 0:03:24.760 --> 0:03:27.720 thing is on the table today and tomorrow, Let's maybe 0:03:28.160 --> 0:03:31.560 table those things. Yeah, the October terrorists are misunderstood and 0:03:31.560 --> 0:03:35.400 they're probably the trickiest part of this entire discussion. December, 0:03:35.760 --> 0:03:37.880 the White House is laser focused on trying to get 0:03:37.960 --> 0:03:40.440 rid of December tariffs because I think they they there 0:03:40.440 --> 0:03:42.240 can most people are convinced that they'd be bad for 0:03:42.280 --> 0:03:44.880 the U S. Economy. September is also on the table. 0:03:45.040 --> 0:03:47.640 It's it's part of the discussion to pull back on 0:03:47.720 --> 0:03:51.760 September tariffs if the US can get the concessions on 0:03:52.160 --> 0:03:55.480 i P. But October is very interesting because the U 0:03:55.560 --> 0:03:58.600 S side is not very focused on October, but markets are. 0:03:58.800 --> 0:04:01.720 Markets are looking at the October tariff hikes as this 0:04:01.960 --> 0:04:05.200 bell weather for whether the US is going to move 0:04:05.240 --> 0:04:07.760 forward with a potential deal. Or a deal is dead, 0:04:07.920 --> 0:04:09.520 and I think it's a mistake because there's just not 0:04:09.640 --> 0:04:12.680 enough attention being put on those October terraces right now. 0:04:12.840 --> 0:04:15.040 They're a minor the a minor issue for the White House, 0:04:15.600 --> 0:04:17.640 but they're huge issue for markets, and that's where you 0:04:17.640 --> 0:04:20.040 could have some miscommunications. There seems to be, though, a 0:04:20.080 --> 0:04:24.039 disconnect also with the market looking at a trade deal 0:04:24.240 --> 0:04:27.599 as sort of a comprehensive one track thing, and you're 0:04:27.600 --> 0:04:30.599 talking about a two track issue. I'm wondering how China 0:04:30.720 --> 0:04:34.120 looks at the US is two track approach. Can they 0:04:34.240 --> 0:04:37.359 isolate some of the capital flow issues and some of 0:04:37.400 --> 0:04:40.560 the I P issues completely while they deal with sort 0:04:40.600 --> 0:04:44.400 of immediate tariffs and agricultural purchases in order to get 0:04:44.400 --> 0:04:46.000 a narrow deal, or are they going to be put 0:04:46.000 --> 0:04:47.839 off by some of the other demands and and sort 0:04:47.880 --> 0:04:51.240 of crackdowns. I think they're definitely put off by it, 0:04:51.279 --> 0:04:53.880 but I think they can also cease some reap some 0:04:53.960 --> 0:04:57.320 rewards from it. So while this trade talk, these trade 0:04:57.360 --> 0:05:00.560 talks are going on, we've also heard word that magically 0:05:00.600 --> 0:05:03.400 we're going to start seeing some Hawaiwi spatial licenses. Now 0:05:03.680 --> 0:05:06.039 Huawei has been separated from the trade talks, the Chinese 0:05:06.080 --> 0:05:08.279 agreed to do that. Everyone agreed with a good idea, 0:05:08.760 --> 0:05:12.279 and magically, even though the things are connected, you're seeing 0:05:12.279 --> 0:05:14.479 some movement on Huawei, while the trade talks have some 0:05:14.520 --> 0:05:17.280 potential to move forward. So what you do is your 0:05:17.320 --> 0:05:19.799 ring fence these things. But I think the Chinese understand 0:05:19.920 --> 0:05:22.760 that good things can happen for them if they make 0:05:22.760 --> 0:05:25.359 President Trump happy, and bad things will probably happen if 0:05:25.400 --> 0:05:28.520 they don't. And so a lot of this is is 0:05:29.040 --> 0:05:33.400 whether things are formally connected versus everything is informally connected 0:05:33.400 --> 0:05:37.320 in some way twenty seconds, what's the probability of us 0:05:37.480 --> 0:05:41.159 seeing some sort of deal, however narrow within the next 0:05:41.160 --> 0:05:43.560 couple of days. I think you. I don't think you'll 0:05:43.560 --> 0:05:46.000 see a deal, But what you could see is the 0:05:46.040 --> 0:05:48.279 outline of what would be the White House and the 0:05:48.360 --> 0:05:51.760 Chinese understanding of what a deal would be for along 0:05:51.800 --> 0:05:54.200 the lines of what I've already explained. But I think 0:05:54.240 --> 0:05:57.120 that is more much more likely than than gloomy markets 0:05:57.120 --> 0:05:59.960 have been expecting for the last day or so. Of course, 0:06:00.520 --> 0:06:03.600 we saw something akin to that in February, and uh, well, 0:06:03.800 --> 0:06:05.880 most we saw where that went. Leland Miller, thank you 0:06:05.920 --> 0:06:07.960 so much for being with us. Leland Miller, chief executive 0:06:07.960 --> 0:06:10.680 officer of China bege Book International, with an incredible view 0:06:11.000 --> 0:06:14.000 into everything having to do with the trade negotiations as 0:06:14.000 --> 0:06:17.120 well as frankly the Chinese economy. He's been prescient on 0:06:17.320 --> 0:06:19.760 how the slowdown has accelerated more than some of the 0:06:19.800 --> 0:06:38.680 official numbers have been suggesting. So it looks like perhaps 0:06:38.720 --> 0:06:42.039 that we may get another report about Amazon spying on 0:06:42.240 --> 0:06:47.080 people through their camera security service. Here to explain all 0:06:47.120 --> 0:06:49.680 the ins and outs here over day. She's a technology 0:06:49.680 --> 0:06:53.200 columnist for Bloomberg Opinion, joining us in our Bloomberger Active 0:06:53.200 --> 0:06:56.560 Broker studios. So Amazon st spying on us? Is that 0:06:56.640 --> 0:06:59.560 the is at the bottom line here? Well, yeah, and 0:06:59.680 --> 0:07:05.040 I think we already knew that the companies you know, 0:07:05.120 --> 0:07:09.520 Echo home speakers and related devices powered by its Alexa 0:07:09.640 --> 0:07:12.440 voice assistant that you know, they're used as sort of 0:07:12.520 --> 0:07:16.239 data collection machines so that Amazon in parts, so Amazon 0:07:16.280 --> 0:07:19.960 can improve the technology behind Alexa. But what are colleagues 0:07:20.200 --> 0:07:24.400 in in Europe and on the West Coast here reported overnight? Uh, 0:07:24.600 --> 0:07:30.160 is that Amazon has sort of human reviewers overseas basically 0:07:30.200 --> 0:07:34.160 looking at snippets of video from cloud Cam, which is 0:07:34.200 --> 0:07:39.120 Amazon's kind of home motion detection security camera. Um, there 0:07:39.120 --> 0:07:43.760 are people reviewing those snippets of video again for use 0:07:43.760 --> 0:07:48.200 in kind of training the artificial intelligence software behind Alexa. 0:07:48.600 --> 0:07:52.480 And you know, Amazon says this is more or less 0:07:52.520 --> 0:07:55.720 disclosed that people are doing it voluntarily, either kind of 0:07:55.720 --> 0:07:59.360 Amazon employees or others, or people choosing to have these 0:07:59.360 --> 0:08:02.760 snippets viewed by people because there's some kind of crash 0:08:02.920 --> 0:08:06.640 or bug. But you know, sources told Bloomberg News that 0:08:06.720 --> 0:08:10.080 in some cases the video snippets were things that people 0:08:10.120 --> 0:08:14.480 would probably not voluntarily give up, including in some cases 0:08:14.480 --> 0:08:17.360 snippets of people having sex. Yeah, so do people do 0:08:17.440 --> 0:08:21.120 we know? Is it clear whether consumers opt into this 0:08:21.640 --> 0:08:24.760 or is it not clear? Well, I mean, as as 0:08:24.800 --> 0:08:27.680 you can see from the sort of examples of very 0:08:27.720 --> 0:08:31.400 sensitive people are probably not opting into having snippets of 0:08:31.400 --> 0:08:36.480 them having sex reviewed by humans. Um. So Amazon says 0:08:36.520 --> 0:08:41.160 this is voluntary. There's obviously some dispute about that. And look, 0:08:41.200 --> 0:08:44.760 I wrote a piece that published today that's basically asking 0:08:45.360 --> 0:08:49.199 is sort of opting in or is disclosure in fine print? 0:08:49.520 --> 0:08:53.000 Really enough? Like, no one who buys a home motion 0:08:53.040 --> 0:08:57.840 detection security camera is really expecting that somewhere in India 0:08:57.960 --> 0:09:02.079 or Romania, there are people sitting there computers reviewing little 0:09:02.120 --> 0:09:06.320 snippets of their from inside their homes. Honestly, though, if 0:09:06.360 --> 0:09:08.840 you put a camera in your home and you're asking 0:09:08.880 --> 0:09:12.680 a company to provide some sort of security, come on, 0:09:12.920 --> 0:09:15.360 I mean, at a certain point, the likelihood of someone 0:09:15.440 --> 0:09:19.560 actually reviewing that is not insignificant, and you're basically asking 0:09:19.600 --> 0:09:21.280 them to do it. You're just hoping that the bots 0:09:21.280 --> 0:09:23.040 are better at it than the humans, which it turns 0:09:23.080 --> 0:09:26.760 out they're not always. So I mean, honestly, what alternative 0:09:26.920 --> 0:09:29.000 is there? No? I think I think that's a fair 0:09:29.040 --> 0:09:32.480 point that um and I think that's an attitude that 0:09:32.520 --> 0:09:34.400 lots of people have that what do you expect if 0:09:34.480 --> 0:09:36.920 you are buying one of these devices, whether it's a 0:09:37.000 --> 0:09:39.960 voice activated speaker or a cell phone that we carry 0:09:39.960 --> 0:09:42.800 around with with us everywhere we go, what do you expect? 0:09:42.840 --> 0:09:46.840 Of course, they're always listening or watching. But I feel 0:09:46.880 --> 0:09:49.640 like there is some kind of limit to this, right, 0:09:49.720 --> 0:09:52.360 that this is a case of boiling the frog slowly. 0:09:53.040 --> 0:09:57.080 Maybe we got okay, although we shouldn't be okay with 0:09:57.160 --> 0:09:59.520 the idea that everything we do online and in the 0:09:59.559 --> 0:10:03.320 real world is basically being monitored and tracked by you know, 0:10:03.360 --> 0:10:05.520 Google or Facebook or Apple or one of these other 0:10:05.600 --> 0:10:08.679 gigantic tech companies. Again, we should not be okay with that, 0:10:09.160 --> 0:10:11.840 but over time we got kind of inured to that. 0:10:12.120 --> 0:10:16.440 But I feel like humans reviewing audio clips of sort 0:10:16.440 --> 0:10:21.199 of what we ask Siri, or again, video snippets from 0:10:21.200 --> 0:10:25.000 footage inside of our homes being reviewed by humans. That 0:10:25.120 --> 0:10:28.320 feels like a different level. And the same thing with 0:10:28.360 --> 0:10:31.520 sort of these kind of facial recognition cameras. Again, this 0:10:31.600 --> 0:10:34.760 is all about collecting as much data as possible and 0:10:34.800 --> 0:10:38.040 then using human reviewers to kind of train the next 0:10:38.040 --> 0:10:41.160 generation of the software to make it smarter and more automated. 0:10:41.520 --> 0:10:46.080 But we're basically human guinea pigs for technology, and we 0:10:46.120 --> 0:10:48.120 did not agree to this. Just because you buy a 0:10:48.160 --> 0:10:50.800 home security camera doesn't mean you agree to be a 0:10:50.840 --> 0:10:53.480 free guinea pig for a big technology company. But as 0:10:53.520 --> 0:10:57.760 you suggested earlier, it just seems like we're on this continuum, uh, 0:10:57.800 --> 0:11:00.360 we as consumers of giving up more and more and 0:11:00.400 --> 0:11:04.560 more of our personal security, of personal privacy in the 0:11:04.640 --> 0:11:09.760 name of technological you know, improvements are just ease, you know, 0:11:09.920 --> 0:11:12.960 whether it's credit card numbers or access to our homes. 0:11:13.360 --> 0:11:16.200 But we all know this, and people still buy the devices. 0:11:16.240 --> 0:11:19.000 So I've got to say at a certain point, you know, 0:11:19.160 --> 0:11:23.560 it hasn't been shown to be materially harmful so far, 0:11:23.960 --> 0:11:26.160 and that is the question. At what point will it 0:11:26.200 --> 0:11:30.160 reach a tipping point? And will the frog be boiled? Yeah, 0:11:30.160 --> 0:11:32.720 that's why I mean, to me, the boiling frog, the 0:11:32.760 --> 0:11:37.000 dead frog moment is humans reviewing video video footage. For me, 0:11:38.280 --> 0:11:42.400 I definitely don't have those. But I think that's a 0:11:42.520 --> 0:11:45.400 very fair point, is sort of do people really care 0:11:45.520 --> 0:11:47.319 about this or do they care enough about it to 0:11:47.440 --> 0:11:49.760 not buy one of these devices? And I think the 0:11:49.840 --> 0:11:52.760 easy answers people don't care. I think it's more nuanced 0:11:52.760 --> 0:11:56.800 than that. They're people definitely do care. We do see, obviously, 0:11:57.880 --> 0:12:03.079 you know, pretty significant growth of um people purchasing echo 0:12:03.160 --> 0:12:08.359 devices and similar kinds of home automation or voice assistant technologies. 0:12:08.559 --> 0:12:11.680 But I don't think that necessarily means people are tacitly 0:12:11.840 --> 0:12:19.199 cool with kind of perpetual surveillance by gigantic rich technology companies. Yeah, 0:12:19.240 --> 0:12:21.400 if you put it that way, I'm sure sure over there. 0:12:21.480 --> 0:12:23.640 Thank you so much for joining us. Here's a technology 0:12:23.640 --> 0:12:25.880 columnist for Bloomberg opinion. Joining us here in our Bloomberg 0:12:25.880 --> 0:12:28.800 Interactive Broker studio, you can read more of sharers at 0:12:28.880 --> 0:12:32.440 work and more from Bloomberg Intelligence. I'm sorry, Blueberg Opinion 0:12:32.480 --> 0:12:35.360 at Bloomberg dot com slash opinion, and you can do 0:12:35.400 --> 0:12:37.040 it on the terminal as well by typing O, P, 0:12:37.400 --> 0:12:58.440 I N go. President Trump saying that he is willing 0:12:58.480 --> 0:13:01.680 to meet with China's top delegate as trade talks heat 0:13:01.760 --> 0:13:04.360 up in Washington, d C. Joining us now to discuss 0:13:04.400 --> 0:13:07.720 Mike McDonough, chief economist for financial Products for Bloomberg LP. 0:13:07.840 --> 0:13:11.040 He is down there in Washington, d C. Mike, Are 0:13:11.040 --> 0:13:14.440 you taking part in the trade negotiations? I? I am not. 0:13:15.000 --> 0:13:18.040 But I do think that that meeting, the agreement to 0:13:18.080 --> 0:13:21.560 have that meeting, is probably a pretty big deal. Really, 0:13:22.200 --> 0:13:25.559 I do, actually, because I don't think. I mean, from 0:13:25.559 --> 0:13:28.600 my own perspective, President Trump hasn't seemed to be one 0:13:28.640 --> 0:13:31.440 to deliver bad news face to face. He seems to 0:13:32.000 --> 0:13:35.120 when things are going poorly, he seems to have other 0:13:35.120 --> 0:13:38.080 people communicate that message, or he does it indirectly via Twitter. 0:13:38.440 --> 0:13:40.720 So the fact that there is an agreement and a 0:13:40.760 --> 0:13:44.559 meeting occurring makes me think that's a positive sign. Mind you, 0:13:44.960 --> 0:13:47.520 there's a meeting occurring as of right now, ten minutes 0:13:47.559 --> 0:13:50.440 from now. We don't know right that could change, but 0:13:50.520 --> 0:13:53.160 assuming I think one of the riskiest headlines you could 0:13:53.160 --> 0:13:56.320 see right now is that that meeting is canceled. Actually, yeah, exactly. 0:13:56.440 --> 0:14:00.040 Um So, Mike, is is it your sense that on 0:14:00.120 --> 0:14:03.640 the Chinese side they would be happy with kind of 0:14:03.679 --> 0:14:07.920 a you know, a light trade agreement or even you know, 0:14:07.960 --> 0:14:10.599 a signed document that we're going to continue talking in 0:14:10.679 --> 0:14:12.640 the interim tariffs are going to be delayed. Is there 0:14:12.960 --> 0:14:15.640 is there a senseim your side that China do that. 0:14:15.800 --> 0:14:18.640 I absolutely get that sense. I think that the mentality 0:14:18.720 --> 0:14:23.040 has changed pretty dramatically from earlier in the year to 0:14:23.280 --> 0:14:26.880 where something is better than nothing and let's you know, 0:14:27.080 --> 0:14:30.440 try to get some agreement. Uh kick the can I 0:14:30.480 --> 0:14:32.600 guess who could say on some of the larger issues, 0:14:33.400 --> 0:14:35.240 but you know, it gets something out of way to 0:14:35.320 --> 0:14:38.680 at least remove the uncertainty from the market of how 0:14:38.760 --> 0:14:42.120 bad this could potentially get. So, Mike, we were speaking 0:14:42.160 --> 0:14:44.720 with Leland Miller of China Beige Book earlier on the show, 0:14:44.760 --> 0:14:47.080 and he was talking about sort of two tracks to 0:14:47.120 --> 0:14:49.840 the negotiations. On one hand, you have sort of a 0:14:49.920 --> 0:14:52.360 crackdown and a hardening in the stance when it comes 0:14:52.360 --> 0:14:55.440 to things like capital flows and I P. Theft. And 0:14:55.480 --> 0:14:57.720 on the other hand, there seems to be a softening 0:14:57.720 --> 0:14:59.560 when it comes to trying to go back to the 0:14:59.560 --> 0:15:03.760 February agreement, when it comes to agricultural deals. Uh, in 0:15:03.840 --> 0:15:06.520 addition to a couple of other things. Do you see 0:15:06.560 --> 0:15:09.600 that also? You know that makes sense? And I guess 0:15:09.640 --> 0:15:12.360 at the heart, you know, at the heart of the 0:15:12.440 --> 0:15:15.680 issues between the US China relations. You know, it's not 0:15:15.840 --> 0:15:19.280 the trade deficit, it's not trade, it's not tariffs, it's 0:15:19.320 --> 0:15:21.280 it's some of that stuff where there there is a 0:15:21.320 --> 0:15:25.080 harder stance being taken. So I'm not shocked by that. Uh. 0:15:25.120 --> 0:15:29.080 And and that sort of action may help hasten or 0:15:29.120 --> 0:15:32.240 expedite some of the longer term solutions in those areas. 0:15:32.240 --> 0:15:35.720 But that is a far more complicated type of conversation 0:15:36.160 --> 0:15:38.720 than whether or not you're going to have some tariffs 0:15:38.720 --> 0:15:41.800 on soybeans or automobiles or whatever else. Are you Here's 0:15:41.840 --> 0:15:45.280 my confusion. Does China see this as a two pronged, 0:15:45.520 --> 0:15:48.480 two separate tract issue. Can they come to some sort 0:15:48.480 --> 0:15:51.200 of agreement with the US in order to alleviate that 0:15:51.280 --> 0:15:55.560 the proposed tariffs that have to do with agricultural goods 0:15:55.760 --> 0:15:58.760 and still be dealing with the US. That's hardening. It 0:15:58.840 --> 0:16:01.560 stands on the other hide. Well, to be clear, you know, 0:16:01.720 --> 0:16:03.440 the last time we were on the show, I was 0:16:03.520 --> 0:16:06.000 mentioning I thought that there was a very high probability 0:16:06.040 --> 0:16:08.160 that we would see a ceasefire in these trade deals. 0:16:08.440 --> 0:16:11.440 And I think right now what everyone wants, uh, like 0:16:11.480 --> 0:16:14.760 I said, is to remove that uncertainty. From a Chinese perspective, Uh, 0:16:14.840 --> 0:16:17.840 the economy has been weakening a bit more than I 0:16:17.880 --> 0:16:20.240 think they may have expected, so that would help alleviate 0:16:20.320 --> 0:16:23.440 some of that. And from a US perspective, you're starting 0:16:23.440 --> 0:16:26.000 to see the economy turn a bit, You're starting to 0:16:26.000 --> 0:16:29.640 see sentiment diminish somewhat. Uh. And if you're the president 0:16:29.760 --> 0:16:32.880 and you want to remain the president, uh, it's that's 0:16:32.720 --> 0:16:35.280 these are all bad inputs to your re election odds. 0:16:35.320 --> 0:16:38.280 So you know, both sides have a reason why they 0:16:38.280 --> 0:16:41.080 want to get something, some win, even if it's if 0:16:41.080 --> 0:16:45.520 it's a minor win. Uh. And and so it's interesting, Yeah, 0:16:45.520 --> 0:16:48.560 it's interesting, Michael, what do you think would constitute a 0:16:49.240 --> 0:16:52.480 win here? I know, expectations have been lowered. Uh, probably 0:16:52.520 --> 0:16:55.840 on both sides. UM, but you know, is an agreement 0:16:55.920 --> 0:16:57.960 just to kick the can down the road, that doesn't 0:16:57.960 --> 0:16:59.760 seem like that would be enough of the markets? What 0:16:59.760 --> 0:17:02.360 do you would be a quote unquote win. I got 0:17:02.400 --> 0:17:04.840 a sense that, um, like I said earlier this year, 0:17:04.880 --> 0:17:08.240 that China would not accept a deal where any of 0:17:08.280 --> 0:17:11.440 the tariffs remained in place. UH. And I think that's 0:17:11.480 --> 0:17:14.119 what the US had been pushing at that time. I 0:17:14.160 --> 0:17:18.320 think now, Uh, the hope is we will agree to 0:17:18.520 --> 0:17:21.960 do X, Y and Z, you know, make more agricultural purchases. 0:17:22.000 --> 0:17:25.479 There's some talks about a currency pact. UM. They might 0:17:25.520 --> 0:17:28.400 have done some stuff on the margins on intellectual property, uh, 0:17:28.400 --> 0:17:31.000 and make this agreement just to not have the next 0:17:31.080 --> 0:17:33.639 round of tariffs in a couple of days or a 0:17:33.640 --> 0:17:36.399 couple of weeks whenever that's scheduled to be put in place. 0:17:36.680 --> 0:17:38.520 And I think from the U S side, you know, 0:17:38.880 --> 0:17:42.040 getting you know, making some progress and just not putting 0:17:42.040 --> 0:17:44.000 on more tariffs and leaving the ones that are there 0:17:44.000 --> 0:17:46.760 in place, UH, can probably be viewed as a win 0:17:46.800 --> 0:17:48.920 as well, at least an interim win for a ceasefire. 0:17:49.800 --> 0:17:52.679 How much agreement is there in the White House about 0:17:52.680 --> 0:17:54.840 how to approach these trade deals to have a sense. 0:17:55.800 --> 0:17:59.120 I mean, the wild card for me and this whole 0:17:59.119 --> 0:18:01.760 thing is, I'm some times don't know if President Trump 0:18:01.800 --> 0:18:04.480 knows what he's going to say before he says it, 0:18:04.520 --> 0:18:06.520 he might have a last minute change of heart go 0:18:06.600 --> 0:18:09.320 up to the podium. And that's the biggest wild card 0:18:09.359 --> 0:18:10.879 in this. And then if you look at this staff, 0:18:10.920 --> 0:18:16.760 I think that you probably have um, obviously some your 0:18:16.800 --> 0:18:20.000 your Peter Navarro's, etcetera. Have rather hawkish views on how 0:18:20.040 --> 0:18:22.400 we should be treating China. And then other members who 0:18:22.440 --> 0:18:26.120 have more dobbage views and who has influence and who 0:18:26.160 --> 0:18:28.840 has listened to most. I think that could be a 0:18:28.880 --> 0:18:31.840 function of how the markets are performing and how the 0:18:31.880 --> 0:18:35.000 economy is performing. Uh. If the hawkish members are saying 0:18:35.040 --> 0:18:37.359 we should do this to China, let's take a strong stance. 0:18:37.600 --> 0:18:39.720 The markets are doing well, the economy is doing well. 0:18:39.880 --> 0:18:43.119 Why not listen. Uh Suddenly things turn uh, and the 0:18:43.160 --> 0:18:46.040 people who have more slightly more dobash stance that this 0:18:46.080 --> 0:18:48.040 is what we said would happen. Here's the approach we 0:18:48.080 --> 0:18:51.560 maybe should take to reduce risk that we ourselves have 0:18:51.600 --> 0:18:53.320 a slow down and then I think they get the 0:18:53.320 --> 0:18:55.800 greater say, there's sort of an inverse relationship of how 0:18:55.840 --> 0:19:00.520 the how the relation to the negotiations are going to markets, right, exactly, right, Hey, Mike, 0:19:00.520 --> 0:19:03.000 thanks so much for joining us. Mike mcdonna, Chief Economists 0:19:03.240 --> 0:19:06.359 for Financial Products at Bloomberg, joining us uh in our 0:19:06.440 --> 0:19:25.800 DC studio. Well, let's shift gears from global trade from brexit. 0:19:25.880 --> 0:19:29.520 Let's talk technology growth. We welcome Melissa di Donado. She 0:19:29.680 --> 0:19:33.080 is the CEO of SUSA, based in London but headquartered 0:19:33.080 --> 0:19:34.840 in Germany, but she joins us here in our Bloomberg 0:19:34.840 --> 0:19:37.320 Interactive Broker studio. So, Melissa, thanks so much for joining 0:19:37.359 --> 0:19:40.879 us here at Bloomberg. Just let's first off, just give 0:19:40.960 --> 0:19:42.919 us a sense of what SUSA is, kind of what 0:19:43.040 --> 0:19:45.359 markets you're operating in and who you know, who your 0:19:45.400 --> 0:19:49.200 customers are. Our customers are enterprise customers across the globe. 0:19:49.440 --> 0:19:51.639 So even though we're out of Germany, word global business 0:19:51.720 --> 0:19:55.119 with the largest the world's largest independent open source company 0:19:55.160 --> 0:19:58.080 in the world right now, All right, then, so you 0:19:58.160 --> 0:20:01.920 focus on providing so for etcetera, within the cloud, within 0:20:01.960 --> 0:20:07.640 the idea of having something that is in the ether. Yeah, yeah, 0:20:07.720 --> 0:20:11.200 kind of something like that. We're an open source software business. 0:20:11.280 --> 0:20:14.719 Right to find open source for US. Open sources software 0:20:14.720 --> 0:20:17.040 built in a community, so there's no proprietary components to 0:20:17.040 --> 0:20:20.200 open source, so open sources for example, it is Yeah. 0:20:20.200 --> 0:20:22.320 So the core of our business is Linux space. It's 0:20:22.359 --> 0:20:26.160 where the world's largest Linux provider independent company in the world, UM, 0:20:26.200 --> 0:20:28.160 and it's all based on open source. That's exactly right. 0:20:28.560 --> 0:20:31.440 So I guess where is the expansion opportunity here? It 0:20:31.480 --> 0:20:34.199 seems to be a fast growing area with a lot 0:20:34.240 --> 0:20:37.240 of competition with everyone wanting to get into this. Where 0:20:37.240 --> 0:20:39.600 where are you seeing opportunities? So UM. I've been on 0:20:39.640 --> 0:20:41.600 board now for sixty five days as the new CEO. 0:20:41.680 --> 0:20:44.800 I was appointed in July. UM. In my first one days, 0:20:44.880 --> 0:20:47.440 I've taken the mission to meet a hunter customers UM 0:20:47.480 --> 0:20:49.560 in my first one hundred days, and that includes customers 0:20:49.560 --> 0:20:52.240 and partners and vendors. And we're a very big channel business. 0:20:52.280 --> 0:20:54.160 So it's been enlightening for me and I've been saying, 0:20:54.200 --> 0:20:55.920 you know, where do we expand where do we grow? 0:20:56.359 --> 0:20:58.639 We were acquired by eq T, which is a private 0:20:58.680 --> 0:21:01.760 equity from Mount of Sweden as our growth investor. UM. 0:21:01.920 --> 0:21:04.320 We were independent as of marks of this year. So really, 0:21:04.520 --> 0:21:06.440 you know, we're looking at where do we grow, where 0:21:06.440 --> 0:21:08.760 do we invest, where do we spend our time? So 0:21:08.840 --> 0:21:10.920 for US, we're doubling down the US market, So that's 0:21:10.920 --> 0:21:13.320 a big one for US UM. You know, we're looking 0:21:13.320 --> 0:21:15.239 to see how we can really transform. And during this 0:21:15.320 --> 0:21:17.760 journey and with my customers and visiting them in the 0:21:17.800 --> 0:21:21.120 last sixty five days going towards a hundred, the message 0:21:21.119 --> 0:21:24.320 has been allowed. They want us to help them simplify, right, 0:21:24.320 --> 0:21:28.640 how do these businesses take potentially big, monolithic global enterprise 0:21:28.680 --> 0:21:31.240 applications and get them at some point in their journey 0:21:31.240 --> 0:21:33.959 to the cloud. That's that's that's one. The second thing 0:21:34.000 --> 0:21:36.359 is how do we accelerate? How do we allow ourselves 0:21:36.440 --> 0:21:40.800 as enterprise customers to SUSA really you know, accelerate and 0:21:40.920 --> 0:21:45.080 modernize their applications as they go. So, Melissa, I saw that, 0:21:45.119 --> 0:21:46.200 you know, one of the things I don't know much 0:21:46.200 --> 0:21:48.200