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Speaker 1: Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keane, along

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Speaker 1: with Jonathan Ferrell and Lisa Brownowitz Jailey. We bring you

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Speaker 1: insight from the best and economics, finance, investment, and international relations.

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Speaker 1: Find Bloomberg Surveillance on Apple Podcast, Suncloud, Bloomberg dot Com,

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Speaker 1: and of course, on the Bloomberg Terminal. Margat Patel has

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Speaker 1: seen it all. She's at Wells Fargo and you need

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Speaker 1: to lean forward and listen carefully as she discusses this

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Speaker 1: odd quiet. Margie, the quiet to me signals something. We

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Speaker 1: have the artificiality of negative yields, we have some new

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Speaker 1: definition of the zero bound. We've got Japan and true

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Speaker 1: gridlock and fixed income linked together. This odd economics to

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Speaker 1: the quiet within the bond market. Well, on the one hand,

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Speaker 1: you have really all the central banks for many decades

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Speaker 1: now pushing down towards the zero interest rates and very

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Speaker 1: much wanting to keep them there. And on the other hand,

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Speaker 1: you have inflation suddenly appearing for the first time in

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Speaker 1: you know, really over a decade, and it seems undeniable,

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Speaker 1: and it seems as if it's becoming more widespread. So

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Speaker 1: it's a lull before the storm before the FED in

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Speaker 1: particular needs to act and do something. Well, the Fed's

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Speaker 1: gonna need to act into something. Are you predicting they are.

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Speaker 1: There's a lot of people out there, let's go with

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Speaker 1: the ancient term inflation east just saying we will see

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Speaker 1: price down yield up. Are you managing for that outcome

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Speaker 1: only in the sense that in my fixed income holdings

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Speaker 1: I've gravitated over the last couple of years actually to

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Speaker 1: better quality, because they won't be as badly impacted if

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Speaker 1: we have a move up in treasury rates, Margie, is

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Speaker 1: the quiet because there really is nothing going on? Or

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Speaker 1: is it simply because right now the bond purchases are overwhelming, Uh,

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Speaker 1: market reactions, market pricing that would normally take place. Well, yes,

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Speaker 1: we have the FED meeting. We also have the quiet

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Speaker 1: before the the the budget resolution to raise a DETLOPT.

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Speaker 1: That's a real hurdle. Nothing is going to happen before then.

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Speaker 1: And most people, I think are now expecting the Fed

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Speaker 1: to do something in the way of tapering. And it's interesting.

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Speaker 1: We all know they're going to do it, so it

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Speaker 1: should all be priced in the marketplace. But when they

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Speaker 1: begin to do something, it'll be interesting to see if

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Speaker 1: the market has a surprise after all, I guess, Margaret,

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Speaker 1: what I'm trying to ask is, what is the direct

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Speaker 1: effect on markets of the one and twenty billion dollar

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Speaker 1: monthly bond purchases by the Federal Reserve? Is there a

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Speaker 1: direct price reaction in the market as a response fromness

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Speaker 1: that will change directly, not from signaling, but directly when

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Speaker 1: they start to reduce that amount. Well, I think if

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Speaker 1: they reduce the amount of mortgage purchases, that would be

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Speaker 1: the most important factor, because I think the FEDS actions

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Speaker 1: are basically just toovering up all the mortgage to purities

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Speaker 1: has kept mortgage rates, maybe even artificially low. So if

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Speaker 1: they stopped buying as many mortgages, would that cause the

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Speaker 1: rate the mortgage rate financing for homeowners to actually go

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Speaker 1: up again. That would not be what the Fed would

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Speaker 1: want to see, but they may not have a choice.

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Speaker 1: So that's what I'm thinking would be something that I'm

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Speaker 1: going to watch and how the banks react to if

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Speaker 1: they reduce the mortgage purchases, Markie. One thing that we've

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Speaker 1: been talking about this week, and it's incredibly exciting week

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Speaker 1: for price action, has been the incredible divergence in the

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Speaker 1: potential views for the economic outlook going forward, and how

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Speaker 1: that's one aspect. John Keiser, piagnist, tell you tell him

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Speaker 1: where that is and then tell him where the prices are.

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Speaker 1: It's sort of unclear. How do you sort of game

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Speaker 1: out this dramatic uncertainty in economic outlooks going forward when

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Speaker 1: it comes to a market call, Well, it looks as

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Speaker 1: if the market itself, the economy is very very solid grounds. Uh,

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Speaker 1: it looks as if all sectors are really moving. The

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Speaker 1: only problem is um higher prices, fore inputs and shortage

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Speaker 1: of labor, and those aren't really bad problems to have.

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Speaker 1: And uh, corporations aren't over levered, consumers aren't over levered.

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Speaker 1: So it looks like the economists in great shape and

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Speaker 1: should be able to take the market higher. It's just

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Speaker 1: a question of how does it react to when the

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Speaker 1: Fed begins to tippy too and do something for tapering.

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Speaker 1: Margie we had on Anahan and Wills Fargo the other day.

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Speaker 1: I don't know if you read her literature. She's just

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Speaker 1: brilliant yell physics and just really gets it done. I

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Speaker 1: was the thunderstruck by the concision of the Wells Fargo

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Speaker 1: equity team on modeling together an earnings call with multiple

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Speaker 1: compression to optimism now in relative optimism out year if

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Speaker 1: anybody can look out that far, do you share that

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Speaker 1: confidence of concision that we see off your equity desk Um,

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Speaker 1: I don't know if I have the confidence, but I

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Speaker 1: also believe that I think that we should see price

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Speaker 1: earnings ratios stay the same or get compressed even though

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Speaker 1: earnings are rising up. So that would leave the market

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Speaker 1: still able to move ahead for those companies that have

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Speaker 1: sustainable earnings. So I think that says the market should

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Speaker 1: move up even if it's more modest, and we've had

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Speaker 1: over the last year and more widespread, not just a

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Speaker 1: handful of stocks lately. They've driven the market over the

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Speaker 1: last six months. Is Microsoft and went off or do

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Speaker 1: you see continued use of cash or share buy back

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Speaker 1: over and above options? Uh? Companies I think have way

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Speaker 1: more cash and they can deploy. And it depends a

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Speaker 1: little bit on what kind of attacks bill will that

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Speaker 1: change their behavior whether they pay dividends, buy back stock,

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Speaker 1: or make acquisitions. So again we have to see how

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Speaker 1: they react, but they have lots of cash to do

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Speaker 1: whatever they want. Margie, when you came on the show earlier,

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Speaker 1: you said that we have seen the death of the

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Speaker 1: credit cycle as we know it based on the response

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Speaker 1: that we have seen from policymakers. And I do wonder

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Speaker 1: if that's the case, why not just invest in the

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Speaker 1: absolute riskiest debt securities and then make a call. And

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Speaker 1: some of these interest rate sensitive stocks like Microsoft, thinking

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Speaker 1: that they will be supported by these low yield policies

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Speaker 1: for the foreseeable future. Well, I think the risk is

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Speaker 1: parts of the market are priced with a very good

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Speaker 1: little premium for anything to go wrong. Um, if there's

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Speaker 1: a hiccup in the economy or too much inflation or

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Speaker 1: the fit over reacts, that's a sector that will be impacted.

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Speaker 1: We've had a tremendous amount of financing from the bottom tier,

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Speaker 1: particularly say in the loan market, private equity market. Those

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Speaker 1: are the weak parts. Plus emerging markets always my candidate

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Speaker 1: for when markets start to crumble, can you play e

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Speaker 1: M now? I mean, which way do you play em?

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Speaker 1: You mentioned the crumble word. We don't talk crumble on

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Speaker 1: Friday market, but go ahead. Well, I think there's a

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Speaker 1: more reason to be cautious. We've seen China's grows and decelerate.

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Speaker 1: We've seen some cracks in the financial system with a

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Speaker 1: large real estate developing firm, look as if it's going

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Speaker 1: to mean some kind of restructuring, and that's really negative

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Speaker 1: for all emerging markets, I think. And so I think

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Speaker 1: that that's an area that I'm still a little cautious out.

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Speaker 1: There hasn't been much risk premium. I think the US

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Speaker 1: still looks like the best place we should have the growth. Also,

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Speaker 1: Continental Europe doesn't look bad. They should have two or

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Speaker 1: three percent in rol growth. So that's not bad. Markie,

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Speaker 1: great to catch up with you. It always is Markey Pittow.

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Speaker 1: The West Franco West Management senior portfolio manager Andrew Slim

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Speaker 1: and joined us now more can stand the investment management

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Speaker 1: senior portfolio manager Andrew number one question the equity market

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Speaker 1: that I hear. Can we get a second run of

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Speaker 1: those cyclicals going into New year? Andrew? Can we? I think? So.

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Speaker 1: I think we're seeing the mirror image of the spring,

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Speaker 1: which was, you know, everyone thought rates were going to

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Speaker 1: two percent, the economy was strong, and the bond market

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Speaker 1: rolled over, cyclicals rolled over, energy prices rolled over, and

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Speaker 1: now all the and then the economic data this summer

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Speaker 1: validated that. And now We're seeing weak economic data, but

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Speaker 1: rates are starting to go up a curve and started

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Speaker 1: re steeping. The semis are breaking out to the upside.

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Speaker 1: So I think the financial markets are telling the reverse

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Speaker 1: of this spring, which is re acceleration in the fourth quarter.

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Speaker 1: So the answer that your question is yes, help me out.

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Speaker 1: You know, I've seen more collective gloom andrew in the

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Speaker 1: last six, seven, eight days, and I've seen in ages.

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Speaker 1: Give me the measure on the slim and wall of

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Speaker 1: worry right now, where's the where's the needle this morning? Well,

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Speaker 1: I I am watching the bond market, and I still

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Speaker 1: say last time I was on your show, I'll be

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Speaker 1: wrong if rates go back to one percent. But I'm

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Speaker 1: noticing despite this economic data, yields are slowly creeping creeping

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Speaker 1: higher there north of one thirty, and energy prices slowly

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Speaker 1: creeping higher. So that's that's That's tells me that my

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Speaker 1: fourth quarter of thesis is not wrong. But I will

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Speaker 1: be wrong if this all rolls over. So that's what

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Speaker 1: I'm That's what I'm worried about. And can we actually

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Speaker 1: get any economic signal from bond markets that are so

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Speaker 1: distorted or distorted is perhaps the fair word influenced by

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Speaker 1: central bank buying not only in the United States but

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Speaker 1: also overseas, no question, no question. Look, I think the

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Speaker 1: bond you know, look right where rates are. Stocks actually

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Speaker 1: should be higher in my opinion on a valuation basis.

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Speaker 1: But I think the stock market gets the gig that

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Speaker 1: the Fed's been buying bonds and rates are artificially low.

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Speaker 1: So I think actually the market is pricing in higher

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Speaker 1: rates uh than this. And just to be clear, if

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Speaker 1: rates go off, I'm not so sure it's great for

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Speaker 1: the capweighted SMP, which benefits from this low rate environment,

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Speaker 1: given the fact that's full of you know, these long

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Speaker 1: dated growth stocks. So Andrew, hey, you think we can

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Speaker 1: get another run of these cyclicals? You think, Treasury you're

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Speaker 1: just starting to inflect time we might have seen the bottom.

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Speaker 1: That's what you suggest in this morning. Many people think, though, Andrew,

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Speaker 1: that we need a catalyst similar to the one we

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Speaker 1: got in early November last year when we got that

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Speaker 1: efficacy data for the vaccines. Do you think we need

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Speaker 1: that kind of of kindily going into year end to

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Speaker 1: get that second run? Well, I think that you're going

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Speaker 1: to see the economic data re accelerate off the third

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Speaker 1: quarter of that kind of the view of of analysts.

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Speaker 1: I think that you're going to get a very good

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Speaker 1: earning season. I don't see any companies pre and uced

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Speaker 1: and you know, you were talking about supply constraints. But

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Speaker 1: you know, I just was at an industrial conference and

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Speaker 1: heard a lot of industrial companies say their backlogs are

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Speaker 1: very strong into next year, and they're very confident about

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Speaker 1: their earnings outlook. So I think, you know, stronger economic data,

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Speaker 1: stronger retail sales, maybe the COVID variant comes down a

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Speaker 1: bit um and you've got your You've got the makings

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Speaker 1: of a of a good fourth quarter. Thank Q four

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Speaker 1: step up Andrew is such a good point. T K.

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Speaker 1: Michael Farolio over at JP Morgan came out yesterday morning,

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Speaker 1: Dan great to Q three upgrade to Q four. They're

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Speaker 1: looking for this step up Q three Q four into

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Speaker 1: next year. So glad you mentioned this. I'm sorry. There's

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Speaker 1: forty seven flavors of opinions out there. I'm watching what

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Speaker 1: corporations are doing. Canadian National off Canadian Pacific just out.

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Speaker 1: They say they've got ambitious value creation. That's the pixie dust.

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Speaker 1: I'm seeing company or company Andrew wrap it up for

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Speaker 1: us speak to them. This re acceleration, this re acceleration

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Speaker 1: into next year is that we're looking for. Yes, And

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Speaker 1: I think the opportunity set is not in the S

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Speaker 1: and P. It's in all those stocks that are below

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Speaker 1: the largest companies that really are off off their highs

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Speaker 1: because they're more cyclically exposed. I think emerging markets off

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Speaker 1: of high I would play those areas versus the market

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Speaker 1: the SMP capway interesting. Andrew, thank you, Andrew Slimmon Morgan

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Speaker 1: Stanley Investment Management, Senior portfolio Manager, Daniel Jrgen Congratulations with

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Speaker 1: I s And of course I can't say enough about

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Speaker 1: the new map. You know, I want to rip up

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Speaker 1: the script and I want you to comment, as you

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Speaker 1: did in the new map on the entrepreneurial global reach

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Speaker 1: of Elon Musk. I am blown away by SpaceX and

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Speaker 1: the idea of putting four civilians up there. How does

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Speaker 1: a guy like you from the prize to the new

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Speaker 1: new map frame Elon Musk? I think, thank you, Tom,

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Speaker 1: I think he uh. Obviously, Ranks is one of the

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Speaker 1: greatest kind of technocratic technocratic entrepreneurs because so much of

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Speaker 1: this is about pushing the technology and doing two things

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Speaker 1: SpaceX and the Tesla, and both of them are you know.

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Speaker 1: Tesla of course, is really transformed the automobile industry. The

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Speaker 1: whole shift towards electric vehicles and putting space opening the

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Speaker 1: ear of space tourism is amazing. It's a you know, market,

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Speaker 1: more market driven than uh th classics. So uh, he's

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Speaker 1: he's a a unique figure. Does the gloom crew that's

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Speaker 1: out there, Daniel, that you fought against for decades, does

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Speaker 1: the gloom crew misjudge the commanding heights of modern technology? Well,

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Speaker 1: I think they tend to underestimate how things how rapidly

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Speaker 1: things can change. I mean they percolate along out of

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Speaker 1: sight for ten or fifteen years while people work on things,

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Speaker 1: and then suddenly it becomes apparent. I mean, whether I mean,

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Speaker 1: just to take energy, shale was twenty years in the making. Uh,

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Speaker 1: it took about forty years for solar to really come

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Speaker 1: down and cost and but when it happens, it really

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Speaker 1: brings big changes. And that's uh, some of what we're

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Speaker 1: seeing today. Well, Daniel, talking about shale, there's a question

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Speaker 1: of whether the death of shale or peak shale has

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Speaker 1: been overstated. In the aftermath of the pandemic a lot

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Speaker 1: of people saying that that was what we have been

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Speaker 1: seeing in terms of the lack of getting oil production

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Speaker 1: back online. Do you think that perhaps people have under

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Speaker 1: underestimated quickly it could get brought back. Well, this is

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Speaker 1: an example of where you see how markets and companies

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Speaker 1: adapt because we really have seen a stabilization of shale.

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Speaker 1: It's growing again. Remember the US is still the largest

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Speaker 1: producer of oil and gas in the world. Uh, the

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Speaker 1: nature of the industry has changed, and there's what I

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Speaker 1: call a second shale revolution, which is about returning cash

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Speaker 1: to investors. And so you're not seeing this. You know,

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Speaker 1: prices where they are today. This was a few years

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Speaker 1: ago you would have seen the brillion rigs really going

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Speaker 1: up in number. But now there's kind of modulation and

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Speaker 1: in general around the world, a kind of caution about

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Speaker 1: rushing into new investment. But at a time when you're

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Speaker 1: seeing strong demand. Uh, either at the end of this

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Speaker 1: year or early next year, we'll see world oil demand

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Speaker 1: higher than it was in So how does this undermine

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Speaker 1: this whole pledge to get to net zero. Well, I

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Speaker 1: think that I mean the pledges to net zero. That's

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Speaker 1: one of the themes in the in the epilogue new

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Speaker 1: part of the New Map, the ambracive net zero carbon

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Speaker 1: by Some are trying to push it to Some say

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Speaker 1: if you try too hard, you're gonna have a macro

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Speaker 1: economic shock, a serious macro economic shop. I think the

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Speaker 1: direction is clear. How you get there? Uh in a

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Speaker 1: world that's still fossil fuels. Uh, the roadmap isn't clear

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Speaker 1: and the answers will really be not rhetoric, not power points,

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Speaker 1: but they'll come from technology. All not mince words about it, folks.

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Speaker 1: The appendix to the New Map is the read of

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Speaker 1: the Weekend by the book. You can read the book

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Speaker 1: in the next week, but this weekend read the appendix

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Speaker 1: is Daniel Jurgen gets out front on the South China.

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Speaker 1: See as you do, Professor Jurgen, you go back in

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Speaker 1: our history. You lectured at the War College. You cited Mayhan.

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Speaker 1: The idea of sea power is a projection. How does

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Speaker 1: submarines project in the South China? See this is right

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Speaker 1: in the heart of the whole issue, the nuclear submarines

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Speaker 1: for Australia. This is about the contest for the South

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Speaker 1: China sea is in an open waterway or is a

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Speaker 1: Chinese territory? And the Chinese used that phrase yesterday they

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Speaker 1: talked about a Cold war mentality. Uh, this is you know,

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Speaker 1: you're kind of seen there's a in many ways Biden

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Speaker 1: has broken with Trump, but not on China policy. And

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Speaker 1: indeed he's trying to mobilize, you know, a consortium of countries.

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Speaker 1: And then these nuclear submarines are exactly about the question

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Speaker 1: of free passes through the South China Sea and the

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Speaker 1: fact of this kind of growing polarization between China, which

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Speaker 1: you've seen in technology, you see it in trade, and

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Speaker 1: you certainly see it militarily US complicated down the negotiations

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Speaker 1: on trying to get to a greener place globally, a

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Speaker 1: conversation China needs to be part of. Absolutely, after all,

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Speaker 1: China's thirty percent of admissions. And Uh, at the end

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Speaker 1: of the Biden administration, of the Obama administration, he and

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Speaker 1: g came to a meeting of minds and the Chinese

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Speaker 1: have adopted this from Nezerio Carbon and I'll tell you

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Speaker 1: that's reverberating throughout China in terms of what's on the

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Speaker 1: topic for people. But the Chinese have said, you cannot

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Speaker 1: compartmentalize this. The US is saying we can compartmentalize it

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Speaker 1: from all the other issues. And we've seen recently the

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Speaker 1: Chinese said no, no, We've had a deal with the

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Speaker 1: other questions as well, So I don't think it can

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Speaker 1: be separated from everything else that's happening right now. Listen,

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Speaker 1: this is like the Miss America pageant, except for doing

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Speaker 1: it with Daniel Jorgan. I'm going to announce my Book

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Speaker 1: of the Year next week. I've already hit adata, so

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Speaker 1: let's have Miss America come out one last time on

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Speaker 1: last year's book of your Dan Jurgen, the New Map,

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Speaker 1: my book of the Year last year. It is absolutely

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Speaker 1: a tour to force. From the prize to commanding I

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Speaker 1: request and onto the must read the summation of where

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Speaker 1: we are right now and again the appendix on the

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Speaker 1: South China see as Dan Jurgan goes all. Robert D. Kaplan,

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Speaker 1: Professor Jrgan, thank you so much, seeing Davos. This is

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Speaker 1: without question our interview of the month on what we're

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Speaker 1: seeing in the South China Sea. Because of time, we're

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Speaker 1: gonna cut right to the chase with James Tevitis, his

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Speaker 1: Book of My Summer two thousand thirty four, when you

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Speaker 1: and Ackerman wrote your fantastic book on the Fears and

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Speaker 1: Instabilities of two thousand thirty four. Admiral Stevidis, did you

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Speaker 1: understand submarines would be part of two thousand thirty four

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Speaker 1: or two thousand twenty one? They are part of both

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Speaker 1: tom as you fully know and appreciate, and in particular

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Speaker 1: nuclear submarines important to understand the difference here. A diesel

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Speaker 1: submarine is like a hybrid car. It's kind of uh.

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Speaker 1: It runs on a battery some of the time, but

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Speaker 1: a lot of the time that has to run. And

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Speaker 1: it's like the duck boats that go across the Charles River.

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Speaker 1: Continue you got it, you got it. And so the

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Speaker 1: nuclear submarines are just the coin of the realm. There

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Speaker 1: we would say about infantry the queen of the battlefield,

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Speaker 1: not as feminine, but rather queen is in a chess

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Speaker 1: piece that can go anywhere, do anything, stander water forever

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Speaker 1: in its utterly lethal explained to me the alliance here

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Speaker 1: developing in the South China Sea out ten years and

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Speaker 1: out to two thousand thirty four. If I'm a Chinese,

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Speaker 1: it is to me it is multiple players with multiple

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Speaker 1: silent things going at thirty one hour through the water.

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Speaker 1: It is and it is because China claims the South

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Speaker 1: China see a vast body of water tom It's half

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Speaker 1: the size of the continental United States. They claim it

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Speaker 1: essentially as territorial waters. It's a preposterous claim. It's been

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Speaker 1: debunked on your international law and in the courts, but

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Speaker 1: they continue to claim it. They build artificial islands. They

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Speaker 1: want control of those waters. They're full of hydrocarbons. Therefore, US,

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Speaker 1: Great Britain, France, Germany, Australia, many other nations are challenging

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Speaker 1: these claims as they should, and operating extensively in what

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Speaker 1: they all consider to be international waters. Admiral, give us

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Speaker 1: a sense of you know, you know, I think most

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Speaker 1: I probably speak from most folks where you know, you know,

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Speaker 1: obviously just awed by the nuclear submarine fleet, but I

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Speaker 1: don't really know much about it, in part because you

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Speaker 1: just don't see them. But we know how important they are.

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Speaker 1: What is China's capability in terms of submarine warfare. It's

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Speaker 1: much smaller than that of the United States, particularly on

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Speaker 1: the nuclear side. So US has sixty eight nuclear submarines called.

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Speaker 1: Fourteen of them are ballistic missiles that shoot our intercontinental

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Speaker 1: ballistic missiles that triedent and fifty four are attack submarines.

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Speaker 1: What we're talking about Australia starting to operate. China only

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Speaker 1: has twelve nuclear submarines, six ballistic and six attack boats.

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Speaker 1: They have lots and lots of diesels for co skill protection,

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Speaker 1: but in terms of nuclear they're a fraction of the

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Speaker 1: United States. So this deal with Australia. Why do you

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Speaker 1: think we pursued this deal with Australia. Is this suggesting

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Speaker 1: that we're trying to, um, you know, kind of diversify

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Speaker 1: some of the responsibility for that part of the world

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Speaker 1: to some other nations. It does, um, let's face it,

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Speaker 1: we are always stronger together. We're always better working with allies,

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Speaker 1: partners and friends, and the more capability, particularly our treaty

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Speaker 1: allies have. In other words, Australian United States are sworn

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Speaker 1: to go to each other's defense in combat. Australia, by

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Speaker 1: the way, has been with us in every war we

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Speaker 1: have fought since they became a nation. So it's always

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Speaker 1: to our advantage to see them with the top end

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Speaker 1: and kit. And that's what's happening here. James Trevillus, I

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Speaker 1: want to take you out of Hollywood with Sean Connery

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Speaker 1: staring gruffly out of the periscope or all we know

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Speaker 1: World War two, A guy named rick Over with a

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Speaker 1: child eldhood is out of the movies, goes out to

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Speaker 1: Pearl Harbor to salvage the US California. After Pearl Harbor

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Speaker 1: goes through World War two and he lands in Oakridge, Tennessee.

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Speaker 1: I should point out with my father it was like

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Speaker 1: twenty years old at the time, and um, you know

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Speaker 1: I I look, James te Vitas at what rick Over

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Speaker 1: did You've got rick Over Boat one? You've got the

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Speaker 1: new Virginia Class. Rick Over explained to our audience worldwide.

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Speaker 1: The biggest misperception we have of Virginia Class submarines. Um,

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Speaker 1: I think we misperceived the amount of ordinance, of the

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Speaker 1: amount of torpedoes and vertical launch Tomahawk missiles they can carry.

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Speaker 1: I think most folks think these are small ships somehow

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Speaker 1: just kind of sneaking around under the water. These are

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Speaker 1: the same size as a big Hardley Burke destroyer. That

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Speaker 1: these are ten thousand ton vessels that us happened to

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Speaker 1: be under the water. So I think in this perception

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Speaker 1: is that these boats, uh don't carry a lot of firepower.

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Speaker 1: They can attack the land, they can attack other submarines,

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Speaker 1: they can attack shipping. They are highly capable offensive. I

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Speaker 1: got like ay questions. Paul sweeneen has got twelve questions,

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Speaker 1: So I'll give you one question. To sell your book.

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Speaker 1: You need to sell some more units before look for

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Speaker 1: the movie guys. Fourth of July two thousand, two thousand

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Speaker 1: thirty four. The Chinese respond to the Americans a number

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Speaker 1: of times, and there's a you know the plot. There's

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Speaker 1: some Indians involved, is well, Amalstavidas? How do the Chinese

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Speaker 1: respond to the announcement in Events of the week? Um?

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Speaker 1: They are deeply distressed and angered and um. This is

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Speaker 1: part of how nations can sleep walk into a war

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Speaker 1: by misperceiving what the other side is doing. So this only,

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Speaker 1: unfortunately lends credence to the cautionary tale, a novel of

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Speaker 1: the next World War. He doesn't need pr he could

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Speaker 1: just sell himself. James de Visas, thank you so much,

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Speaker 1: author of two thousand thirty four. And can I note

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Speaker 1: that Elliott Ackerman, who co wrote this thing. Mr Vidas

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Speaker 1: has without question my essay of the moment in Foreign

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Speaker 1: Affairs magazine. It is heartbreach This is the Bloomberg Surveillance Podcast.

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Speaker 1: Thanks for listening. Join us live weekdays from seven to

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Speaker 1: ten AMI Eastern on Bloomberg Radio and on Bloomberg Television

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Speaker 1: each day from six to nine am for insight from

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Speaker 1: the best in economics, finance, investment, and international relations. And

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Speaker 1: subscribe to the Surveillance podcast on Apple podcast, SoundCloud, Bloomberg

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Speaker 1: dot com, and of course on the terminal. I'm Tom Keene,

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Speaker 1: and this is Bloomberg