1 00:00:09,880 --> 00:00:13,880 Speaker 1: Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keene Jay Leie. 2 00:00:13,960 --> 00:00:17,560 Speaker 1: We bring you insight from the best in economics, finance, investment, 3 00:00:18,000 --> 00:00:23,520 Speaker 1: and international relations. Find Bloomberg Surveillance on Apple Podcasts, SoundCloud, 4 00:00:23,600 --> 00:00:27,200 Speaker 1: Bloomberg dot com, and of course, on the Bloomberg. Our 5 00:00:27,240 --> 00:00:29,639 Speaker 1: top story. I RAN's striking back, firing more than a 6 00:00:29,680 --> 00:00:32,640 Speaker 1: dozen miss outside the Rocky Air basis hosting US troops. 7 00:00:32,880 --> 00:00:35,800 Speaker 1: Foreign Minister Muhammed jabats a Reef, tweeting the following around, 8 00:00:35,840 --> 00:00:38,879 Speaker 1: concluded proportionate measures in self defense, adding we do not 9 00:00:39,040 --> 00:00:42,760 Speaker 1: seek escalation or war, but will defend ourselves against any aggression. 10 00:00:42,760 --> 00:00:46,559 Speaker 1: The focus now assessing the damage done, US official insisting 11 00:00:46,560 --> 00:00:49,519 Speaker 1: there were no US casualties, and, as Tom points out, 12 00:00:49,560 --> 00:00:53,200 Speaker 1: the President expected to address the nation later today. Here's 13 00:00:53,200 --> 00:00:56,040 Speaker 1: to take from Eurasia Group quote it RAN's attacks appear 14 00:00:56,120 --> 00:00:59,920 Speaker 1: designed for maximum domestic effect with a minimum escalatory risk. 15 00:01:00,160 --> 00:01:05,240 Speaker 1: Trump will likely declined to retaliate militarily. Eurisia joined us now, 16 00:01:05,319 --> 00:01:07,600 Speaker 1: Henry rhyme, you write a group global macro analysts joined 17 00:01:07,680 --> 00:01:10,080 Speaker 1: us on the phone. Henry, great to catch up with you. 18 00:01:10,120 --> 00:01:12,760 Speaker 1: Walk me through what gives you the conviction that Iran 19 00:01:12,840 --> 00:01:16,880 Speaker 1: has managed to appease the discontent at home and minimize 20 00:01:16,920 --> 00:01:21,000 Speaker 1: the prospect of escalatory risk in the region. Hi, good morning, 21 00:01:21,080 --> 00:01:23,759 Speaker 1: Tom and John. I think at this point what our 22 00:01:23,880 --> 00:01:27,240 Speaker 1: our our biggest question going into last night was what 23 00:01:27,280 --> 00:01:30,160 Speaker 1: Trump would do once I ran strikes back. We were 24 00:01:30,160 --> 00:01:33,399 Speaker 1: fairly convinced that Iran would would would do so. The 25 00:01:33,440 --> 00:01:37,000 Speaker 1: domestic pressure was extreme, and and and and I think 26 00:01:37,080 --> 00:01:40,240 Speaker 1: looking at what Iran pulled off last night with no 27 00:01:40,600 --> 00:01:45,160 Speaker 1: US casualties and a clear statement from the leadership that 28 00:01:45,160 --> 00:01:48,480 Speaker 1: that that this round is over, I think gives us 29 00:01:48,600 --> 00:01:51,880 Speaker 1: confidence that the President can come out today and say 30 00:01:52,160 --> 00:01:57,160 Speaker 1: mission accomplished, essentially a perhaps a speak a speech version 31 00:01:57,160 --> 00:01:59,960 Speaker 1: of his tweet last night. All as well, the last 32 00:02:00,080 --> 00:02:03,280 Speaker 1: time we said mission accomplished, that didn't work out so well. 33 00:02:03,320 --> 00:02:06,320 Speaker 1: What is going to be the outcome of a president 34 00:02:06,560 --> 00:02:09,919 Speaker 1: saying in his press conference mission accomplished. How will the 35 00:02:10,160 --> 00:02:13,040 Speaker 1: that be taken by Capitol Hill and far more, how 36 00:02:13,040 --> 00:02:17,440 Speaker 1: will that be taken by Tehran? Yeah, well, that's perhaps 37 00:02:17,440 --> 00:02:19,720 Speaker 1: a bad choice of words on my part, but but 38 00:02:19,800 --> 00:02:24,200 Speaker 1: I think the Iranians will uh take that positively. Frankly, Look, 39 00:02:24,240 --> 00:02:25,960 Speaker 1: I mean, what we're not out of the wood. Yet 40 00:02:26,000 --> 00:02:29,640 Speaker 1: I want to emphasize that point the the the Iranians. 41 00:02:29,760 --> 00:02:33,880 Speaker 1: I I don't think consider the debt of the Sulimani 42 00:02:33,960 --> 00:02:36,920 Speaker 1: assassination to be fully paid. And I think we'll see 43 00:02:37,320 --> 00:02:41,560 Speaker 1: a return to the kind of low level attacks, especially 44 00:02:41,600 --> 00:02:44,840 Speaker 1: in the cyber world and in terms of terrorism that 45 00:02:44,840 --> 00:02:48,160 Speaker 1: that the Iranians have have perfected over the decades. But 46 00:02:48,200 --> 00:02:52,000 Speaker 1: in terms of a risk of a direct military clash, 47 00:02:52,200 --> 00:02:55,520 Speaker 1: I think assuming the President comes out and says we 48 00:02:55,639 --> 00:02:58,600 Speaker 1: got the job done, then then then I think that 49 00:02:58,760 --> 00:03:01,480 Speaker 1: risk has gone down, and let's talk about objective. Secretary 50 00:03:01,520 --> 00:03:05,040 Speaker 1: Pompeio said he wanted to establish an effective deterrence. Question 51 00:03:05,080 --> 00:03:08,040 Speaker 1: now is whether taking out General Selimony was enough. And 52 00:03:08,080 --> 00:03:10,160 Speaker 1: after the events of last night, where they feel confident 53 00:03:10,320 --> 00:03:12,960 Speaker 1: that they have established the terrance with that air strike 54 00:03:13,080 --> 00:03:17,600 Speaker 1: last week, well I think they will. I think the 55 00:03:17,600 --> 00:03:19,959 Speaker 1: the US will be able to point to this moment 56 00:03:20,280 --> 00:03:23,640 Speaker 1: or quite a few I mean certainly years, if not longer, 57 00:03:23,720 --> 00:03:28,880 Speaker 1: down down the line, to demonstrate a what it what 58 00:03:28,960 --> 00:03:32,680 Speaker 1: it looks like when the US loses patients uh with 59 00:03:32,680 --> 00:03:35,600 Speaker 1: with Iranian activity. So so I think that the Iranians 60 00:03:35,640 --> 00:03:39,720 Speaker 1: are are fairly chastened by what happened, and you saw 61 00:03:39,760 --> 00:03:42,520 Speaker 1: that with what they decided to do last night. They 62 00:03:42,640 --> 00:03:47,640 Speaker 1: launched sophisticated ballistic missiles. Absolutely, but they caused no casualties 63 00:03:47,680 --> 00:03:51,480 Speaker 1: and it was a single round, if you will, of retaliation. 64 00:03:51,520 --> 00:03:55,120 Speaker 1: I think that demonstrates that the Iranians were were quite spooked. 65 00:03:55,360 --> 00:03:58,440 Speaker 1: But Henry, this is so important. I mean, it's like 66 00:03:58,480 --> 00:04:01,800 Speaker 1: a sterile kind of retaliation. Did you say there were 67 00:04:01,840 --> 00:04:05,240 Speaker 1: no casualties at least based on President's reports? Is there 68 00:04:05,280 --> 00:04:10,400 Speaker 1: any way to run a war? Well, I mean, uh, 69 00:04:10,840 --> 00:04:13,720 Speaker 1: we were we we we were expecting the Iranians to 70 00:04:13,800 --> 00:04:17,800 Speaker 1: incur some casualties. But but it looks as though there 71 00:04:17,920 --> 00:04:21,479 Speaker 1: was a good deal of concern about what that um, 72 00:04:21,600 --> 00:04:24,400 Speaker 1: what that would cause. I mean sometimes, I mean with 73 00:04:24,400 --> 00:04:28,360 Speaker 1: with things like this, you often there is um there's 74 00:04:28,440 --> 00:04:32,000 Speaker 1: risk in over interpreting actions of a of a kinetic 75 00:04:32,120 --> 00:04:34,279 Speaker 1: type that we don't know if it was an accident 76 00:04:34,360 --> 00:04:37,440 Speaker 1: or intentional that that nobody was killed here. But I 77 00:04:37,440 --> 00:04:40,880 Speaker 1: think the totality of the events last night seemed to 78 00:04:40,920 --> 00:04:44,640 Speaker 1: indicate that the Iranians, uh decided to tone it down 79 00:04:44,640 --> 00:04:46,760 Speaker 1: a notch. Henry. I think what was surprising for many, 80 00:04:46,960 --> 00:04:49,440 Speaker 1: even experts looking at the country is that this was 81 00:04:49,480 --> 00:04:53,240 Speaker 1: a conventional strike launched from Iran by Iranian forces. It 82 00:04:53,320 --> 00:04:56,719 Speaker 1: was direct forces to direct forces. This wasn't fire proxies, 83 00:04:57,000 --> 00:04:59,200 Speaker 1: this wasn't at US allies. And I think that's what 84 00:04:59,279 --> 00:05:01,760 Speaker 1: everyone was quite surprised by, Henry. Do you really think 85 00:05:01,760 --> 00:05:03,640 Speaker 1: that we can just move on from that as the 86 00:05:03,720 --> 00:05:08,320 Speaker 1: dice progress, Well, I mean, I think we can move 87 00:05:08,360 --> 00:05:11,039 Speaker 1: on in terms of uh that there will be a 88 00:05:11,120 --> 00:05:15,400 Speaker 1: return to a kind of low level of of conflict 89 00:05:15,480 --> 00:05:17,800 Speaker 1: that's kind of pervaded over the past few years, and 90 00:05:18,320 --> 00:05:22,960 Speaker 1: extraordinary levels of of tension and a good deal of concern, 91 00:05:23,480 --> 00:05:26,840 Speaker 1: especially about the Iranian nuclear program, which I think is 92 00:05:26,880 --> 00:05:30,480 Speaker 1: a clear option for the Iranian to continue to escalate 93 00:05:30,520 --> 00:05:33,400 Speaker 1: at this point. But but I would say that the 94 00:05:33,520 --> 00:05:38,559 Speaker 1: risk and and and and panic about a Iran US 95 00:05:38,680 --> 00:05:43,680 Speaker 1: military to military confrontation that takes out shipping in the 96 00:05:43,680 --> 00:05:47,240 Speaker 1: Persian Gulf, destroys energy infrastructure in a big way. I 97 00:05:47,279 --> 00:05:49,560 Speaker 1: think that risk has gone way down after last night. 98 00:05:49,839 --> 00:05:51,760 Speaker 1: If you're just joining us, Henry rome with US. Here's 99 00:05:51,760 --> 00:05:54,000 Speaker 1: the Eurasia Group, and of course we've been featuring their 100 00:05:54,040 --> 00:05:57,280 Speaker 1: top risks of and and we're thrilled the Dector room 101 00:05:57,360 --> 00:05:59,240 Speaker 1: could be with us here a few days ago and 102 00:05:59,240 --> 00:06:02,520 Speaker 1: now joins us on this important morning. What I heard 103 00:06:02,560 --> 00:06:06,680 Speaker 1: this morning, Uh, Henry, from Rupert Harrison over in London 104 00:06:06,720 --> 00:06:09,080 Speaker 1: with his government work with the United Kingdom, from Sir 105 00:06:09,160 --> 00:06:14,119 Speaker 1: Tom Beckett with on the ground experience in the Middle East, 106 00:06:14,160 --> 00:06:18,280 Speaker 1: and from Ambassador Hormats was very simple the tone of 107 00:06:18,320 --> 00:06:23,279 Speaker 1: the President. What kind of tone should the President affect 108 00:06:23,400 --> 00:06:28,680 Speaker 1: this morning? Well, I think the most uh productive from 109 00:06:29,200 --> 00:06:32,360 Speaker 1: kind of trying to deescalate the conflicts would be not 110 00:06:32,520 --> 00:06:36,120 Speaker 1: to go on a victory parade about the killing of 111 00:06:36,240 --> 00:06:39,320 Speaker 1: General Sulamani, not to kind of rub it in the 112 00:06:39,360 --> 00:06:45,320 Speaker 1: Iranians face, either the the assassination or the ineffectiveness of 113 00:06:45,440 --> 00:06:49,880 Speaker 1: the UH missile launch last night. Unfortunately, I don't think 114 00:06:49,920 --> 00:06:53,400 Speaker 1: that's the President's style. I mean the I think it 115 00:06:53,400 --> 00:06:55,960 Speaker 1: would have things would have turned out quite differently if 116 00:06:56,000 --> 00:06:59,640 Speaker 1: the US had actually just not claimed responsibility for the 117 00:06:59,640 --> 00:07:02,840 Speaker 1: Silman on the assassination, as you know, in the kind 118 00:07:02,880 --> 00:07:06,440 Speaker 1: of Israeli practice of just letting it be uh, letting 119 00:07:06,480 --> 00:07:08,920 Speaker 1: it be vague. But but but I think the President 120 00:07:08,920 --> 00:07:12,000 Speaker 1: will find it hard not to botht uh and and 121 00:07:12,080 --> 00:07:14,960 Speaker 1: perhaps gloat a bit this morning. But I think at 122 00:07:14,960 --> 00:07:17,400 Speaker 1: the end of the day, as as long as he's 123 00:07:17,440 --> 00:07:20,840 Speaker 1: somewhat restrained, and I would hope that the past few 124 00:07:20,960 --> 00:07:26,680 Speaker 1: days have demonstrated to him clearly the risks that going 125 00:07:26,720 --> 00:07:30,000 Speaker 1: up against Iran can entail, then then then I would 126 00:07:30,000 --> 00:07:33,240 Speaker 1: expect things to be all right. Henry. By now, we're 127 00:07:33,240 --> 00:07:35,160 Speaker 1: all familiar with the president's approach, but over the last 128 00:07:35,160 --> 00:07:37,360 Speaker 1: twelve hours he has been quite restrained. We have had 129 00:07:37,360 --> 00:07:41,040 Speaker 1: a single twite suggesting he'll address the nation later this morning. 130 00:07:41,040 --> 00:07:43,200 Speaker 1: It made me just wonder what was happening inside the 131 00:07:43,200 --> 00:07:46,360 Speaker 1: White House last night when the president was so restrained 132 00:07:46,520 --> 00:07:49,320 Speaker 1: the decision making process at the White House? Who is 133 00:07:49,360 --> 00:07:52,240 Speaker 1: informing the decision making process? Are they providing a menu 134 00:07:52,280 --> 00:07:54,800 Speaker 1: of responses for the President of United States again or 135 00:07:54,840 --> 00:07:57,800 Speaker 1: strongly counseling for the president to do one thing over 136 00:07:57,840 --> 00:08:00,320 Speaker 1: the other. Your thoughts on what's happening right now as 137 00:08:00,360 --> 00:08:05,240 Speaker 1: the United States calculates its response, Sure, I would expect 138 00:08:05,280 --> 00:08:08,920 Speaker 1: that that that that the military, as always, will provide 139 00:08:08,960 --> 00:08:13,640 Speaker 1: him a range of of options. Though I think at 140 00:08:13,960 --> 00:08:17,680 Speaker 1: this stage she will be strongly counseled to take this 141 00:08:17,760 --> 00:08:20,960 Speaker 1: blow and uh call it a day, if you will. 142 00:08:21,360 --> 00:08:25,239 Speaker 1: I think the risk of retaliating significantly and and having 143 00:08:25,280 --> 00:08:28,160 Speaker 1: this spiral further is just very high. And I think 144 00:08:28,200 --> 00:08:30,480 Speaker 1: he's at a he's at a point now politically where 145 00:08:30,520 --> 00:08:33,040 Speaker 1: he can claim victory. Will final question for you, Henry 146 00:08:33,200 --> 00:08:36,040 Speaker 1: China's role expected to be in the United States next 147 00:08:36,080 --> 00:08:40,599 Speaker 1: week on January for a signing ceremony closer to the 148 00:08:40,640 --> 00:08:43,360 Speaker 1: Iranian certainly more so than the United States. What do 149 00:08:43,400 --> 00:08:45,120 Speaker 1: you think that role will be in the coming weeks, 150 00:08:45,120 --> 00:08:48,280 Speaker 1: if they will establish one at all. So, I think 151 00:08:48,320 --> 00:08:52,360 Speaker 1: from the Chinese point of view, their big objectives here 152 00:08:52,440 --> 00:08:56,240 Speaker 1: with regards to Iran is no war and no nuclear 153 00:08:56,240 --> 00:09:00,240 Speaker 1: weapon and everything else in between there is negotiable. Think 154 00:09:00,240 --> 00:09:04,600 Speaker 1: as the Iranians continue to escalate on the nuclear program, 155 00:09:04,640 --> 00:09:06,840 Speaker 1: the Chinese are one of the more important countries to 156 00:09:06,920 --> 00:09:10,320 Speaker 1: watch about how much pressure they are on Iran to 157 00:09:10,360 --> 00:09:13,680 Speaker 1: try to keep things contained. So, yes, they are closer 158 00:09:13,720 --> 00:09:16,280 Speaker 1: to Iran, but they also have a lot of leverage, 159 00:09:16,320 --> 00:09:19,880 Speaker 1: so I would expect them to play an active, albeit 160 00:09:20,000 --> 00:09:23,120 Speaker 1: quiet role in trying to tone things down or urge 161 00:09:23,160 --> 00:09:26,000 Speaker 1: the Iranian the tone things now. Andry Rome, thank you 162 00:09:26,080 --> 00:09:27,920 Speaker 1: so much. Will you raise your group this morning as 163 00:09:27,960 --> 00:09:30,520 Speaker 1: we move through the morning, with the markets doing better. 164 00:09:44,320 --> 00:09:47,199 Speaker 1: John Farro now in our studio is an important guests, 165 00:09:47,240 --> 00:09:49,480 Speaker 1: an important guests. Indeed, great to have you with us. 166 00:09:49,520 --> 00:09:52,520 Speaker 1: Pop hole mass kissing to associates, Vice Chairman, I'm best 167 00:09:52,679 --> 00:09:56,240 Speaker 1: always great to catch up with you. The allies have gone, 168 00:09:56,280 --> 00:09:59,040 Speaker 1: miss Where are they? Where are the Europeans? Why they 169 00:09:59,120 --> 00:10:01,880 Speaker 1: not more vocal over the last week? Well, I think 170 00:10:01,920 --> 00:10:05,280 Speaker 1: the US has kept Europe more or less out of 171 00:10:05,320 --> 00:10:10,160 Speaker 1: its diplomacy on a wide range of issues. There are 172 00:10:10,160 --> 00:10:14,439 Speaker 1: obviously major trade frictions uh and the US did not 173 00:10:14,440 --> 00:10:19,320 Speaker 1: notify its allies with respect to the strike and the 174 00:10:19,600 --> 00:10:24,160 Speaker 1: killing of General Solimani, and doesn't seem to have been 175 00:10:24,200 --> 00:10:27,080 Speaker 1: engaging the Europeans on virtually anything that has to do 176 00:10:27,120 --> 00:10:29,400 Speaker 1: with the Middle East, which is a major departure from 177 00:10:29,400 --> 00:10:32,120 Speaker 1: the past, when the United States worked hand in glove 178 00:10:32,200 --> 00:10:36,000 Speaker 1: with the Europeans on a wide range of Middle Eastern issues, 179 00:10:36,080 --> 00:10:38,800 Speaker 1: not always convincingly, but at least it worked with them. 180 00:10:38,840 --> 00:10:41,480 Speaker 1: There was a hope this morning that we avoid escalation risk, 181 00:10:41,559 --> 00:10:43,280 Speaker 1: underlined by the fact that we're just hearing from a 182 00:10:43,360 --> 00:10:45,839 Speaker 1: US official that there were no US casualties in those 183 00:10:45,880 --> 00:10:50,679 Speaker 1: strikes overnight. But the question remains America's future in a rock? 184 00:10:51,160 --> 00:10:53,960 Speaker 1: What is it? Bob Well? I think for the moment, 185 00:10:54,040 --> 00:10:57,440 Speaker 1: now we understand that we need to do what we can. 186 00:10:57,640 --> 00:11:01,760 Speaker 1: I hope we understand least to help stabilized a very 187 00:11:01,880 --> 00:11:07,679 Speaker 1: unstable Iraqi situation. If Iraq continues to deteriorate and become 188 00:11:07,679 --> 00:11:12,720 Speaker 1: more unstable, They're two beneficiaries. One is Iran. Iran's already 189 00:11:12,760 --> 00:11:18,000 Speaker 1: extremely influential in Iraq because Iraq is predominantly a Sunni 190 00:11:18,120 --> 00:11:22,680 Speaker 1: a Shia country, although Saddam was Sunny, the government now 191 00:11:22,800 --> 00:11:25,760 Speaker 1: and most of the leaders are Shia. And the other 192 00:11:25,960 --> 00:11:31,079 Speaker 1: is that the Russians, now having made major steps forward 193 00:11:31,120 --> 00:11:34,880 Speaker 1: and increasing their influence in Syria, will now be aiming 194 00:11:34,960 --> 00:11:39,319 Speaker 1: to increase their influence in Iraq as well. Putin's visit 195 00:11:39,400 --> 00:11:42,199 Speaker 1: to Syria, I'm sure it was not an accident and 196 00:11:42,400 --> 00:11:46,840 Speaker 1: probably was planned before the killing of Sulimani, but um 197 00:11:46,960 --> 00:11:49,480 Speaker 1: now he is playing a major role in Syria and 198 00:11:49,480 --> 00:11:52,560 Speaker 1: will probably attempt to do so to a greater degree 199 00:11:52,600 --> 00:11:56,080 Speaker 1: in Iraq. The Russians and the Iranians don't always get along, 200 00:11:56,760 --> 00:11:59,760 Speaker 1: but they both want to defeat Isis, and they both 201 00:12:00,520 --> 00:12:03,640 Speaker 1: I think we'll be competing for influence but also trying 202 00:12:03,640 --> 00:12:06,360 Speaker 1: to cooperate to the extent they can and and and 203 00:12:06,440 --> 00:12:08,880 Speaker 1: Ron wants to get the US out of the region, 204 00:12:09,640 --> 00:12:12,680 Speaker 1: so does Russia. They work together to do it or 205 00:12:12,720 --> 00:12:15,880 Speaker 1: will they also have conflict between them. And that's the 206 00:12:15,920 --> 00:12:17,839 Speaker 1: final point, is perhaps the most important point. When you 207 00:12:17,880 --> 00:12:20,440 Speaker 1: try and illuminate the path forward, what the future looks like, 208 00:12:20,480 --> 00:12:22,560 Speaker 1: you have to look at individual objectives and quite clearly 209 00:12:22,559 --> 00:12:25,080 Speaker 1: the Iranians making it clear right at night their objective 210 00:12:25,120 --> 00:12:26,520 Speaker 1: is not war, but their objective is to get the 211 00:12:26,600 --> 00:12:28,560 Speaker 1: United States out of the region. How do they come 212 00:12:28,600 --> 00:12:31,959 Speaker 1: about doing that, Well, that's a complicated thing. First of all, 213 00:12:32,000 --> 00:12:36,240 Speaker 1: they have increased their influence in Baghdad as as we've seen. 214 00:12:36,800 --> 00:12:40,800 Speaker 1: And second now they're going to portray the us UH 215 00:12:40,840 --> 00:12:43,440 Speaker 1: in an adverse light as a result of all this 216 00:12:43,520 --> 00:12:48,120 Speaker 1: and demonstrate that they UH have backed off and try 217 00:12:48,200 --> 00:12:51,360 Speaker 1: to deescalate and I want to play a greater role. 218 00:12:51,440 --> 00:12:53,520 Speaker 1: They don't want more tensions in the region. They're going 219 00:12:53,559 --> 00:12:57,640 Speaker 1: to advertise that point as well. But the other is 220 00:12:57,720 --> 00:13:01,480 Speaker 1: that they still want to demonstrate they're going to be 221 00:13:02,000 --> 00:13:05,640 Speaker 1: tough on ISIS that ISIS is not defeated, and Iraq 222 00:13:05,760 --> 00:13:08,400 Speaker 1: needs them to defeat ISIS. And if the US is 223 00:13:08,440 --> 00:13:12,400 Speaker 1: an uncertain ally and an uncertain presence, then the Iraqi 224 00:13:12,400 --> 00:13:14,280 Speaker 1: government will have to call on them to a greater 225 00:13:14,360 --> 00:13:18,559 Speaker 1: degree to make sure ISSIS doesn't undergo a resurgence and 226 00:13:18,640 --> 00:13:22,000 Speaker 1: visitor homs. You served the nation under both Republicans and 227 00:13:22,040 --> 00:13:24,880 Speaker 1: Democrats over the years, the last tour of duty with 228 00:13:24,920 --> 00:13:28,040 Speaker 1: Secretary Clinton and with President Obama. What do we most 229 00:13:28,040 --> 00:13:32,240 Speaker 1: get wrong about the day of a given secretary of state? 230 00:13:32,280 --> 00:13:35,000 Speaker 1: I mean we see Secretary of State Pompeo come out 231 00:13:35,000 --> 00:13:38,000 Speaker 1: and make comments and that what's the behind the scenes 232 00:13:38,200 --> 00:13:41,880 Speaker 1: reality for any secretary of state, particularly given this moment. 233 00:13:42,400 --> 00:13:45,079 Speaker 1: Rule one for the secretary of State is make sure 234 00:13:46,160 --> 00:13:50,680 Speaker 1: of two things. One that you have influence over the president, 235 00:13:50,720 --> 00:13:53,320 Speaker 1: that the president listens to you, that you have access 236 00:13:53,400 --> 00:13:57,280 Speaker 1: to the president, that you are heard uh not only 237 00:13:57,280 --> 00:14:00,720 Speaker 1: by the President by but by his national security apparatus 238 00:14:00,760 --> 00:14:03,120 Speaker 1: in the White House. But the second is that you 239 00:14:03,240 --> 00:14:07,640 Speaker 1: understand what the president wants. Because the most confusing thing 240 00:14:07,679 --> 00:14:10,720 Speaker 1: to other countries is if the Secretary of State says 241 00:14:10,800 --> 00:14:13,720 Speaker 1: one thing or thinks one thing, and the president says 242 00:14:13,840 --> 00:14:17,120 Speaker 1: or thinks something else. It's very confusing to both our 243 00:14:17,160 --> 00:14:19,760 Speaker 1: allies because they don't know who to listen to and 244 00:14:19,840 --> 00:14:23,800 Speaker 1: to our adversaries since they're not sure what to do, 245 00:14:23,880 --> 00:14:26,960 Speaker 1: and therefore they tend to take advantage of those gaps. 246 00:14:27,040 --> 00:14:29,120 Speaker 1: And John we saw that, of course with this question 247 00:14:29,160 --> 00:14:31,960 Speaker 1: about the cultural targets within Iran, and that had to 248 00:14:32,000 --> 00:14:34,560 Speaker 1: be when it's a final question, let's ask it. How 249 00:14:34,640 --> 00:14:37,360 Speaker 1: much dayline is the between what Secretary Pompeio would like 250 00:14:37,400 --> 00:14:40,160 Speaker 1: to do and what the President of United States ultimately wants. 251 00:14:40,160 --> 00:14:43,040 Speaker 1: Hard to say at this point, but Secretary Pompeio has 252 00:14:43,120 --> 00:14:47,760 Speaker 1: taken in general a much tougher line on Iran. The 253 00:14:47,800 --> 00:14:52,160 Speaker 1: President ran for office on the ground, so pulling the 254 00:14:52,280 --> 00:14:55,960 Speaker 1: US back from the Middle East in general, So there 255 00:14:56,000 --> 00:15:00,000 Speaker 1: clearly are differences in emphasis. In the end, the President, 256 00:15:00,120 --> 00:15:03,680 Speaker 1: of course prevails in these things. He's the commander in chief. Ambassador, 257 00:15:03,800 --> 00:15:06,040 Speaker 1: thank you so much for joining us today. Ambassador Robert 258 00:15:06,040 --> 00:15:22,880 Speaker 1: Hormess's with Kissinger Associates, joining us now in studio as 259 00:15:22,920 --> 00:15:27,600 Speaker 1: a gentleman who's truly expert on this. Greg Ferrell was 260 00:15:27,920 --> 00:15:33,320 Speaker 1: a distinguished career in journalism looking at process of courts, 261 00:15:33,720 --> 00:15:38,040 Speaker 1: not criminality, not civil issues, but just simply the making 262 00:15:38,240 --> 00:15:41,560 Speaker 1: of the process what is the process of this press conference? 263 00:15:41,600 --> 00:15:44,760 Speaker 1: What are your thoughts after observing an hour? In five minutes? 264 00:15:45,000 --> 00:15:49,200 Speaker 1: Greg Um, First of all, this is an extraordinary thing 265 00:15:49,360 --> 00:15:53,840 Speaker 1: to have a chief executive fighting allegations in a different country. 266 00:15:53,920 --> 00:15:56,280 Speaker 1: This the whole saga that's gotten to to this point. 267 00:15:56,760 --> 00:15:59,440 Speaker 1: So good question. I was thinking about this. What's his 268 00:15:59,480 --> 00:16:03,040 Speaker 1: point today? A Um, this should be. I think, like 269 00:16:03,080 --> 00:16:06,040 Speaker 1: the prosecutors, he needs to make a case that the 270 00:16:06,120 --> 00:16:08,960 Speaker 1: Japanese authorities are wrong, that there's something wrong with the system. 271 00:16:09,160 --> 00:16:14,280 Speaker 1: That's a legitimate, you know, platform to take. I think 272 00:16:14,280 --> 00:16:18,240 Speaker 1: he's getting into too much detail too soon. Um that 273 00:16:18,360 --> 00:16:21,000 Speaker 1: a twenty minute summary of this is what's wrong. I'm 274 00:16:21,040 --> 00:16:22,880 Speaker 1: happy to play this out over time. But he's like 275 00:16:22,920 --> 00:16:25,720 Speaker 1: he's trying a case right now this morning and in 276 00:16:25,720 --> 00:16:28,280 Speaker 1: in the study of this that you have done and 277 00:16:28,280 --> 00:16:30,960 Speaker 1: you're truly expert in this. Does he hire Sullivan and 278 00:16:31,000 --> 00:16:35,480 Speaker 1: Cromweller name another law firm to go out and represent 279 00:16:35,840 --> 00:16:40,240 Speaker 1: him in Japan or with the Japanese legal system? Is 280 00:16:40,280 --> 00:16:43,960 Speaker 1: he is outside of Japan? Can he do that? I 281 00:16:44,040 --> 00:16:47,640 Speaker 1: don't know. I do know he's been handled by a 282 00:16:47,760 --> 00:16:51,760 Speaker 1: number of major law firms, including Paul weiss Um where 283 00:16:51,760 --> 00:16:54,000 Speaker 1: his primary U S firm over there. But I think 284 00:16:54,400 --> 00:16:57,240 Speaker 1: that bridge has been burned. I think any like attempt 285 00:16:57,320 --> 00:17:01,040 Speaker 1: by a firm to at least it too soon right now. 286 00:17:01,280 --> 00:17:06,000 Speaker 1: And he's he's getting personal. He mentioned Pearl Harbor like 287 00:17:07,200 --> 00:17:10,919 Speaker 1: you know, he's going ballistic right off. Ballistic is a 288 00:17:10,960 --> 00:17:13,800 Speaker 1: professional legal phrase of journalists ues. We would not want 289 00:17:13,800 --> 00:17:16,520 Speaker 1: to use it. Actually after thought went ballistic last night. 290 00:17:16,520 --> 00:17:20,080 Speaker 1: Now that I think Greg, seriously here, what's the next 291 00:17:20,119 --> 00:17:23,160 Speaker 1: step for him after this lengthy press conference in Q 292 00:17:23,240 --> 00:17:32,439 Speaker 1: and A, Um, this continues to be a public relations battle. Um, 293 00:17:32,480 --> 00:17:36,280 Speaker 1: he needs to radio. You gotta keep talking. Okay, sorry, 294 00:17:36,960 --> 00:17:39,760 Speaker 1: except you're so thoughtful. You always got me to be slower. 295 00:17:40,000 --> 00:17:43,159 Speaker 1: But he needs to keep up the public relations battle. 296 00:17:43,440 --> 00:17:45,719 Speaker 1: I think he needs to bring other people in. He 297 00:17:45,800 --> 00:17:49,240 Speaker 1: has to do a better job or at least continue 298 00:17:49,320 --> 00:17:52,479 Speaker 1: with trying to demonstrate the the what he described as 299 00:17:52,520 --> 00:17:55,440 Speaker 1: the patent unfairness of how he was treated in Japan. 300 00:17:55,800 --> 00:17:58,040 Speaker 1: So this is going to go on for some time. 301 00:17:58,320 --> 00:18:01,240 Speaker 1: I think ideally, if you could find a neutral third 302 00:18:01,240 --> 00:18:05,520 Speaker 1: country like the US where something like this could be adjudicated, uh, 303 00:18:05,640 --> 00:18:07,960 Speaker 1: that would be a you know, there must be a 304 00:18:07,960 --> 00:18:10,399 Speaker 1: face saving way. I think that's what he's going to 305 00:18:10,440 --> 00:18:12,119 Speaker 1: look for in the Japanese eventually might look for a 306 00:18:12,119 --> 00:18:15,600 Speaker 1: face saving way without them backing down completely. Can he 307 00:18:15,680 --> 00:18:18,159 Speaker 1: leave and go somewhere? Can he go very quickly here? 308 00:18:18,200 --> 00:18:20,440 Speaker 1: Can he go to Paris? Can he come to New York? No? 309 00:18:20,520 --> 00:18:22,680 Speaker 1: He can go to Paris, yes, New York no. Because 310 00:18:23,119 --> 00:18:27,679 Speaker 1: because strangely, the United States signed an extradition treaty with Japan, 311 00:18:27,880 --> 00:18:32,440 Speaker 1: just along with South Korea. I'm not I didn't. I'm 312 00:18:32,480 --> 00:18:34,520 Speaker 1: not sure why this happened, but the fact that it 313 00:18:34,560 --> 00:18:37,120 Speaker 1: does have it means that it doesn't mean US will 314 00:18:37,160 --> 00:18:40,159 Speaker 1: necessarily have to turn him over, but it just you know, 315 00:18:40,280 --> 00:18:42,720 Speaker 1: creates a legal mechanism for that to happen. Greg, thank 316 00:18:42,760 --> 00:18:44,520 Speaker 1: you so much for joining us on a short notice. 317 00:18:44,600 --> 00:18:48,080 Speaker 1: Mr Ferrell truly expert on the travails of Mr Gone. 318 00:19:01,040 --> 00:19:05,359 Speaker 1: The scope and scale of Africa is extraordinary and any 319 00:19:05,400 --> 00:19:07,879 Speaker 1: time we could get a vision into it, it is 320 00:19:07,960 --> 00:19:12,600 Speaker 1: quite important. There's a gentleman in Nigeria who, through family 321 00:19:12,720 --> 00:19:16,040 Speaker 1: and his grandfather and great grandfather were quite successful in 322 00:19:16,119 --> 00:19:20,280 Speaker 1: West African business. There is a gentleman in Nigeria who 323 00:19:20,280 --> 00:19:23,000 Speaker 1: has done better than good David Rubinstein with a peer 324 00:19:23,040 --> 00:19:27,320 Speaker 1: to peer conversation with Mr Dan Gotti of Nigeria. Here 325 00:19:27,480 --> 00:19:31,600 Speaker 1: is Mr Rubenstein and the scope of Africa. Okay, so 326 00:19:31,720 --> 00:19:35,159 Speaker 1: in terms of Africa itself generally, are you bullish on 327 00:19:35,200 --> 00:19:38,960 Speaker 1: Africa's prospects as a place to in which people can 328 00:19:39,000 --> 00:19:42,959 Speaker 1: invest private equity firms or industrial companies to invest. I 329 00:19:42,960 --> 00:19:46,200 Speaker 1: think I'm very, very bullish when it comes to Africa, 330 00:19:46,240 --> 00:19:48,879 Speaker 1: and it is the main reason David to they we 331 00:19:49,040 --> 00:19:54,560 Speaker 1: have twenty billion dollars though I invest in all you 332 00:19:54,600 --> 00:19:57,119 Speaker 1: know what tele which will finish by the end of 333 00:19:57,280 --> 00:20:00,960 Speaker 1: next day. First quota of you, I mean in the 334 00:20:01,000 --> 00:20:03,639 Speaker 1: next two years. Listen in the next two years, David 335 00:20:03,680 --> 00:20:09,040 Speaker 1: Rubinstein speaking with Elko. Then go to Mr Rubinstein joins us. Now, David, 336 00:20:09,080 --> 00:20:13,280 Speaker 1: what an interesting individual. Give our American audience a little 337 00:20:13,320 --> 00:20:17,240 Speaker 1: scope and scale of who this gentleman is. Okay. Aliko 338 00:20:17,720 --> 00:20:20,639 Speaker 1: Dante is the wealthiest man in Africa. So it's a 339 00:20:20,680 --> 00:20:23,680 Speaker 1: continent of a billion plus people and he is by 340 00:20:23,680 --> 00:20:27,040 Speaker 1: far the wealthiest person. Range. His net worth ranges from 341 00:20:27,040 --> 00:20:29,520 Speaker 1: twenty to thirty billion, depending on the stock market by 342 00:20:29,600 --> 00:20:33,000 Speaker 1: the time. Um he's a Nigerian. His he was from 343 00:20:33,040 --> 00:20:35,840 Speaker 1: a very wealthy family, but he was not given money 344 00:20:35,840 --> 00:20:38,640 Speaker 1: when he started, and he basically built the largest cement 345 00:20:38,720 --> 00:20:42,560 Speaker 1: business in Nigeria and then the largest cement business in Africa. 346 00:20:42,960 --> 00:20:46,160 Speaker 1: And he's used that to build into other areas petro chemicals, 347 00:20:46,160 --> 00:20:50,720 Speaker 1: particularly building a large refinery, the largest refinery now in Nigeria. UM. 348 00:20:50,800 --> 00:20:54,280 Speaker 1: He is a very honest person, very philanthropic. He's very 349 00:20:54,320 --> 00:20:56,960 Speaker 1: involved with Bill Gates and philanthropic things in Africa and 350 00:20:56,960 --> 00:21:01,679 Speaker 1: around the world. So he's quite pressive individual, very modest 351 00:21:01,720 --> 00:21:04,960 Speaker 1: on assuming in Nigeria. He drives his own car around 352 00:21:05,000 --> 00:21:08,439 Speaker 1: without security guards. UM. He's very accessible to people, so 353 00:21:08,560 --> 00:21:12,320 Speaker 1: he's quite a likable person in addition to being very successful. 354 00:21:12,320 --> 00:21:14,800 Speaker 1: And David, what's so extraordinary and I'd love for you 355 00:21:14,840 --> 00:21:17,959 Speaker 1: to comment on this with your expertise at Carlyle. He 356 00:21:18,040 --> 00:21:20,680 Speaker 1: did what's so hard to do. He didn't sell out 357 00:21:20,720 --> 00:21:24,120 Speaker 1: to Lafarge years ago, did he? He did not. Um. 358 00:21:24,200 --> 00:21:26,240 Speaker 1: Lafarge wanted to buy him and at the time he 359 00:21:26,240 --> 00:21:28,600 Speaker 1: probably could have used Lafarge because he was struggling at 360 00:21:28,600 --> 00:21:32,359 Speaker 1: the beginning. But he uh built this big business and 361 00:21:32,400 --> 00:21:34,919 Speaker 1: it's by far the biggest cement business now. He was 362 00:21:34,960 --> 00:21:38,240 Speaker 1: probably aided by the fact though he wasn't responsible for it. 363 00:21:38,240 --> 00:21:42,400 Speaker 1: It's it's not easy to import cement into Nigeria, and 364 00:21:42,480 --> 00:21:46,359 Speaker 1: so by building the biggest cement company in Nigeria, he 365 00:21:46,440 --> 00:21:49,160 Speaker 1: had a very large market uh in which to work. 366 00:21:49,400 --> 00:21:52,000 Speaker 1: But he's built cement businesses in other countries in Africa 367 00:21:52,040 --> 00:21:54,800 Speaker 1: as well. So very impressive, very smart, low key. If 368 00:21:54,800 --> 00:21:57,000 Speaker 1: you were to have dinner with him, you wouldn't realize 369 00:21:57,000 --> 00:22:00,120 Speaker 1: he's fabulously wealthy or fabulously successful. Were very well known 370 00:22:00,119 --> 00:22:03,760 Speaker 1: in Africa, very modest and unassuming David. It's interesting. This 371 00:22:03,800 --> 00:22:06,000 Speaker 1: is a fascinating interview from my perspective because I just 372 00:22:06,200 --> 00:22:09,280 Speaker 1: I was not aware of Mr Dante. Is he have 373 00:22:09,440 --> 00:22:11,879 Speaker 1: any sense that he would like to raise his profile 374 00:22:12,080 --> 00:22:16,080 Speaker 1: in the West. Well, you may know that from time 375 00:22:16,080 --> 00:22:20,320 Speaker 1: to time you'll see ads on CNN, dan Gote Industries 376 00:22:20,320 --> 00:22:23,080 Speaker 1: and so forth, and those are probably raising his profile 377 00:22:23,160 --> 00:22:25,800 Speaker 1: a little bit. But most of his investments, I would say, 378 00:22:26,320 --> 00:22:29,400 Speaker 1: far as I know, of his investments are really in Africa. 379 00:22:29,960 --> 00:22:32,280 Speaker 1: He hasn't really diversified out of Africa yet. He might 380 00:22:32,320 --> 00:22:35,080 Speaker 1: do that at some point. Um. He has a number 381 00:22:35,080 --> 00:22:38,400 Speaker 1: of daughters and they will ultimately be involved in investing 382 00:22:38,440 --> 00:22:42,080 Speaker 1: some of his money. No sons and he's uh, you know, 383 00:22:42,480 --> 00:22:46,160 Speaker 1: a well respected person. He doesn't use politics to get ahead. Uh. 384 00:22:46,160 --> 00:22:48,440 Speaker 1: He knows all the political figures, but he basically built 385 00:22:48,440 --> 00:22:50,919 Speaker 1: a very big business and that's the source of his strength. 386 00:22:51,400 --> 00:22:53,760 Speaker 1: One time for one more question, David Rubinsteter, And of 387 00:22:53,800 --> 00:22:56,320 Speaker 1: course this goes to something John Farrell said to me. 388 00:22:56,560 --> 00:22:59,159 Speaker 1: Farrell emailed and said, you've got to ask, do you 389 00:22:59,200 --> 00:23:01,439 Speaker 1: have an up to eight on his desire for the 390 00:23:01,520 --> 00:23:04,400 Speaker 1: number one Arsenal fan in the world to take out 391 00:23:04,520 --> 00:23:09,679 Speaker 1: Arsenal give us the Rubenstein update. He is fascinated by, 392 00:23:09,800 --> 00:23:13,159 Speaker 1: uh by what we what is called football, we call soccer, 393 00:23:13,640 --> 00:23:17,080 Speaker 1: and I would say that, uh um, it's something that 394 00:23:17,280 --> 00:23:19,760 Speaker 1: has an appeal to people in certain parts of the 395 00:23:19,760 --> 00:23:23,680 Speaker 1: world that Americans probably can't understand. But it's much bigger 396 00:23:23,680 --> 00:23:27,120 Speaker 1: to people in Africa or in Europe than football American 397 00:23:27,119 --> 00:23:29,480 Speaker 1: football is to us, or to baseball is to us. 398 00:23:29,600 --> 00:23:32,679 Speaker 1: And so he is a gigantic football fan. There's no 399 00:23:32,680 --> 00:23:35,560 Speaker 1: doubt about it, exactly. David Rubenstein, thank you so much 400 00:23:36,080 --> 00:23:39,280 Speaker 1: for joining us. David Rubinstein show Peer to Peer Conversations 401 00:23:39,320 --> 00:23:43,440 Speaker 1: airs tonight on Bloomberg Television at nine pm. Wall Street Times. 402 00:23:43,480 --> 00:23:46,920 Speaker 1: Speaking with the Dan got a Group founder president CEO 403 00:23:47,000 --> 00:23:50,520 Speaker 1: Aliko dan Gote uh is interesting, richest man in Africa 404 00:23:50,800 --> 00:23:54,240 Speaker 1: and twenty billion dollars. I didn't know about this guy 405 00:23:54,320 --> 00:23:56,680 Speaker 1: at all. It's just extraordinary. You know. Some of the 406 00:23:56,760 --> 00:23:59,240 Speaker 1: moves be created in Africa. Yeah, in a major shoutout 407 00:23:59,240 --> 00:24:01,719 Speaker 1: to France and Laque was really driven for the Bloomberg 408 00:24:01,840 --> 00:24:04,720 Speaker 1: study of what he has done for Nigeria. Paul. This 409 00:24:04,840 --> 00:24:06,959 Speaker 1: hearkens back to when you and I were starting out 410 00:24:07,000 --> 00:24:11,320 Speaker 1: in international investment. Your only option in most countries was 411 00:24:11,400 --> 00:24:14,040 Speaker 1: by shares in the phone company for by shares in 412 00:24:14,119 --> 00:24:18,240 Speaker 1: the cement company. That was really yet exactly without exaggeration, 413 00:24:18,640 --> 00:24:20,800 Speaker 1: exactly and that you know, I kind of got an 414 00:24:21,080 --> 00:24:23,600 Speaker 1: understanding of the cement business, the construction business when you 415 00:24:23,600 --> 00:24:26,399 Speaker 1: started looking at Latin America years ago, and that was 416 00:24:26,480 --> 00:24:28,800 Speaker 1: one of the ways to play the growth in developing 417 00:24:28,840 --> 00:24:31,879 Speaker 1: markets such as Latin American. Of course, uh, that would 418 00:24:31,960 --> 00:24:35,280 Speaker 1: obviously apply to Africa as well. So UM, I'm not surprising. 419 00:24:35,280 --> 00:24:38,440 Speaker 1: I guess if you think about developing markets, developing economies, 420 00:24:38,440 --> 00:24:40,840 Speaker 1: what do they need to build? Maybe that's what Jim 421 00:24:40,840 --> 00:24:43,600 Speaker 1: O'Neal meant when he said brick right, the brick countries 422 00:24:44,000 --> 00:24:46,920 Speaker 1: as well, anyways, David Rubinstein tonight and through the week 423 00:24:47,200 --> 00:24:50,680 Speaker 1: when Mr Dangote on Africa. Thanks for listening to the 424 00:24:50,680 --> 00:24:57,200 Speaker 1: Bloomberg Surveillance podcast. Subscribe and listen to interviews on Apple Podcasts, SoundCloud, 425 00:24:57,560 --> 00:25:01,760 Speaker 1: or whichever podcast platform you refer. I'm on Twitter at 426 00:25:01,840 --> 00:25:06,080 Speaker 1: Tom Keane before the podcast. You can always catch us worldwide. 427 00:25:06,520 --> 00:25:07,639 Speaker 1: I'm Bloomberg Radio.