1
00:00:02,520 --> 00:00:10,119
Speaker 1: Bloomberg Audio Studios, podcasts, radio news. This is your weekly

2
00:00:10,280 --> 00:00:14,080
Speaker 1: Washington policy Pulse on the Balance of Power Podcasts. I'm

3
00:00:14,160 --> 00:00:18,279
Speaker 1: Joe Matthew. Every Monday, Bloomberg Intelligence, senior policy analyst and

4
00:00:18,320 --> 00:00:21,160
Speaker 1: friend of the show, Nathan Dean shares his weekly call

5
00:00:21,239 --> 00:00:24,639
Speaker 1: on upcoming catalysts in the nation's capital. Listen for the

6
00:00:24,640 --> 00:00:27,319
Speaker 1: most recent and relevant policy research from our team at

7
00:00:27,360 --> 00:00:31,000
Speaker 1: Bloomberg Intelligence. Now with today's installment, here's Nathan Dean.

8
00:00:31,920 --> 00:00:34,800
Speaker 2: Good morning and good afternoon everybody. Welcome again to the

9
00:00:34,880 --> 00:00:37,080
Speaker 2: Washington Policy Pose. My name is Nathan Dean. I'm a

10
00:00:37,120 --> 00:00:39,960
Speaker 2: senior policy analyst with Bloomberg Intelligence here in the Washington

11
00:00:40,040 --> 00:00:42,280
Speaker 2: DC Bureau. Want to say thank you very much for

12
00:00:42,400 --> 00:00:44,360
Speaker 2: attending our call today, and thank you for those of

13
00:00:44,400 --> 00:00:46,760
Speaker 2: you who are attending this via or listening to this

14
00:00:46,880 --> 00:00:50,080
Speaker 2: via the Balance of Power podcast. We always appreciate your

15
00:00:50,120 --> 00:00:52,880
Speaker 2: listening as well. You know, It's funny when I was

16
00:00:52,920 --> 00:00:54,760
Speaker 2: driving in this morning, I was like, I don't think

17
00:00:54,800 --> 00:00:56,760
Speaker 2: we have much to talk about this week on the

18
00:00:56,760 --> 00:00:59,200
Speaker 2: policy posset, and then as I started putting together the issues,

19
00:00:59,240 --> 00:01:01,720
Speaker 2: I was like, eh, we actually have quite a bit here.

20
00:01:01,840 --> 00:01:05,240
Speaker 2: So let's first start off with what's going out in Asia,

21
00:01:05,240 --> 00:01:07,720
Speaker 2: and you know, President Trump left on Friday night for

22
00:01:07,880 --> 00:01:13,400
Speaker 2: his tour of Asia, Japan, Malaysia, South Korea. We have

23
00:01:13,440 --> 00:01:16,840
Speaker 2: a significant meeting coming up with President Gjping. So what

24
00:01:16,880 --> 00:01:18,399
Speaker 2: I wanted to do is, for those of you who

25
00:01:18,440 --> 00:01:23,320
Speaker 2: have terminals, if you go to b Eco Research and

26
00:01:23,360 --> 00:01:26,800
Speaker 2: then Geoeconomics, that's where my friends over at Bloomberg Economics

27
00:01:26,880 --> 00:01:27,560
Speaker 2: are putting.

28
00:01:27,319 --> 00:01:30,360
Speaker 3: All of their pieces. They also have.

29
00:01:30,520 --> 00:01:34,160
Speaker 2: A daily newsletter that comes out every day at noon

30
00:01:34,240 --> 00:01:37,200
Speaker 2: Eastern that summarizes all of this. You can go to

31
00:01:37,319 --> 00:01:40,200
Speaker 2: n sub fault lines just ping me. I'll make sure

32
00:01:40,240 --> 00:01:42,039
Speaker 2: that you can get attached to this and you'll see this.

33
00:01:42,120 --> 00:01:44,240
Speaker 2: But for those of you who don't have Bloomberg terminals,

34
00:01:44,560 --> 00:01:48,280
Speaker 2: Bloomberg dot Com, the Bloomberg news site has a running

35
00:01:48,320 --> 00:01:50,880
Speaker 2: blog of what's happening here in the region. And I

36
00:01:51,000 --> 00:01:53,720
Speaker 2: just briefly wanted to talk about what were the issues here,

37
00:01:53,720 --> 00:01:56,240
Speaker 2: the key issues that are at state when it comes

38
00:01:56,240 --> 00:01:59,440
Speaker 2: to President Trump's meeting with President Gjping. First one is

39
00:01:59,520 --> 00:02:01,480
Speaker 2: rare earth. We've seen a lot of talk about rare

40
00:02:01,520 --> 00:02:05,600
Speaker 2: earth minerals. President Trump has talked about tariffs associated with this.

41
00:02:05,680 --> 00:02:08,440
Speaker 2: There was an investigation that was launched, a tariff investigation

42
00:02:08,720 --> 00:02:11,520
Speaker 2: that was launched towards rare earth minerals back in April.

43
00:02:11,760 --> 00:02:13,919
Speaker 2: So obviously that's one of the key things that will

44
00:02:13,960 --> 00:02:18,320
Speaker 2: happen here. Export controls very very critical to the technology sector,

45
00:02:18,760 --> 00:02:23,560
Speaker 2: fentanyl supply, TikTok shipping, levees, soybing trade. This is something

46
00:02:23,600 --> 00:02:27,959
Speaker 2: that I know that our agricultural clients and agricultural analysts

47
00:02:27,960 --> 00:02:29,799
Speaker 2: are looking at in additional tariffs.

48
00:02:30,160 --> 00:02:30,480
Speaker 3: Now.

49
00:02:30,680 --> 00:02:33,480
Speaker 2: You know, we saw obviously over the weekend when President

50
00:02:33,520 --> 00:02:35,399
Speaker 2: Trump said a couple months, a couple of weeks ago,

51
00:02:35,400 --> 00:02:37,200
Speaker 2: it felt like a couple of months when President Trump

52
00:02:37,240 --> 00:02:38,400
Speaker 2: said a couple weeks ago that he was going to

53
00:02:38,400 --> 00:02:41,680
Speaker 2: place one hundred percent additional tariffs on China. In long story,

54
00:02:41,720 --> 00:02:43,720
Speaker 2: short is, I don't think anybody really in the market

55
00:02:43,760 --> 00:02:47,640
Speaker 2: really anticipated that happening. Over the weekend. Treasury Secretary Scott

56
00:02:47,680 --> 00:02:50,359
Speaker 2: Besant said that there was a framework that was being

57
00:02:50,400 --> 00:02:54,680
Speaker 2: discussed looked for, you know, weekend talks to potentially allow

58
00:02:54,720 --> 00:02:59,040
Speaker 2: President Trump and President Jijiping to sign that framework. Still

59
00:02:59,080 --> 00:03:01,800
Speaker 2: to determined on how much of a framework that actually is.

60
00:03:02,400 --> 00:03:06,200
Speaker 2: Are there details associated with that, so stay close if again,

61
00:03:06,240 --> 00:03:09,000
Speaker 2: if you have a terminal the Bloomberg Economics team. They

62
00:03:09,000 --> 00:03:10,840
Speaker 2: already have analysts out in the region that are writing

63
00:03:10,919 --> 00:03:12,800
Speaker 2: this up. Again, I can show you where that is

64
00:03:12,800 --> 00:03:15,320
Speaker 2: in the terminal. If you don't have a terminal, stick

65
00:03:15,320 --> 00:03:17,600
Speaker 2: to Bloomberg dot com. There's a running blog, or there

66
00:03:17,639 --> 00:03:19,760
Speaker 2: will be a running blog in which the Bloomberg News

67
00:03:19,880 --> 00:03:22,800
Speaker 2: articles will be popping up here. So against stay tuned.

68
00:03:22,840 --> 00:03:24,400
Speaker 2: There's going to be a lot of stuff happening with

69
00:03:24,480 --> 00:03:28,440
Speaker 2: President Trump's Asia trip. On the shutdown update, I really

70
00:03:28,480 --> 00:03:31,280
Speaker 2: don't have much of an update for you. The House

71
00:03:31,320 --> 00:03:34,720
Speaker 2: Republican Caucus is still out of town this week. The

72
00:03:34,760 --> 00:03:38,000
Speaker 2: Republican senators are essentially just continuing their talking points. The

73
00:03:38,040 --> 00:03:41,400
Speaker 2: Democratic senators are continuing their talking points. The polling data

74
00:03:41,400 --> 00:03:45,320
Speaker 2: hasn't really changed. Again, Independents slightly blame Republicans more for

75
00:03:45,360 --> 00:03:48,200
Speaker 2: the shutdown than Democrats. But if you're looking at this

76
00:03:48,280 --> 00:03:51,680
Speaker 2: from a Republican perspective, you're looking at the same data

77
00:03:51,760 --> 00:03:54,000
Speaker 2: and you're seeing the significant amount of support that you're

78
00:03:54,000 --> 00:03:57,040
Speaker 2: getting in your party for this, and ultimately both sites

79
00:03:57,080 --> 00:03:59,760
Speaker 2: continue to believe that they're in the better position politically.

80
00:04:00,320 --> 00:04:04,320
Speaker 2: Now you will see some potential I don't want to

81
00:04:04,320 --> 00:04:06,880
Speaker 2: call it negotiations, but you may see some potential chit

82
00:04:06,960 --> 00:04:10,000
Speaker 2: chat about ideas of reopening the government as we get

83
00:04:10,000 --> 00:04:12,120
Speaker 2: close to November. First, we have a couple of catalysts.

84
00:04:12,520 --> 00:04:16,719
Speaker 2: We have a second military paycheck. Air traffic controllers just

85
00:04:16,720 --> 00:04:20,200
Speaker 2: missed a paycheck earlier this or late last week. You

86
00:04:20,279 --> 00:04:23,320
Speaker 2: are going to see additional discussions over SNAP benefits. This

87
00:04:23,440 --> 00:04:26,040
Speaker 2: is forty two million Americans. This is the program formerly

88
00:04:26,040 --> 00:04:29,880
Speaker 2: known as food stamps. You know, obviously the Republicans are

89
00:04:29,920 --> 00:04:31,440
Speaker 2: in the White House at the moment have taken the

90
00:04:31,480 --> 00:04:34,200
Speaker 2: stance that they don't have the authority to pay SNAP benefits.

91
00:04:34,560 --> 00:04:37,320
Speaker 2: Democrats are coming back and saying, yes, you do. Again,

92
00:04:37,400 --> 00:04:40,040
Speaker 2: it's just political posturing. But you know, if forty two

93
00:04:40,080 --> 00:04:44,600
Speaker 2: million Americans can't get their supplemental Nutritional Assistance program benefits

94
00:04:44,640 --> 00:04:47,560
Speaker 2: next week, that may change. We're also seeing more and

95
00:04:47,640 --> 00:04:53,479
Speaker 2: more delays at airports tacking up over the weekend. For example,

96
00:04:53,480 --> 00:04:56,040
Speaker 2: I'm flying on November eleventh, and I'm beginning to get

97
00:04:56,040 --> 00:04:58,640
Speaker 2: that question of, well, if the shutdown still occurring, you

98
00:04:58,680 --> 00:05:01,719
Speaker 2: know what's going to happen with But you know, the

99
00:05:01,760 --> 00:05:04,000
Speaker 2: general sense here is is that you'll see this uptick

100
00:05:04,040 --> 00:05:07,480
Speaker 2: this week probably won't see a solution or anywhere close

101
00:05:07,520 --> 00:05:10,520
Speaker 2: to a solution, I think at this point, I think

102
00:05:10,560 --> 00:05:13,360
Speaker 2: the next major catalyst, if it's not the additional paychecks

103
00:05:13,360 --> 00:05:15,600
Speaker 2: to come in November, it's going to have to be Thanksgiving,

104
00:05:15,640 --> 00:05:17,080
Speaker 2: and it's going to have to be this potential for

105
00:05:17,120 --> 00:05:20,320
Speaker 2: a massive stick out from TSA agents or ATTRACK controllers

106
00:05:20,680 --> 00:05:24,920
Speaker 2: leading to widespread disruptions. So that's my update on the shutdown.

107
00:05:25,400 --> 00:05:28,360
Speaker 2: We'll see again what happens. We also have some news

108
00:05:28,360 --> 00:05:30,600
Speaker 2: coming out to you from the Federal Reserve on financial

109
00:05:30,640 --> 00:05:34,880
Speaker 2: regulatory matters. Just last week Bloomberg News, this is Katanga Johnson.

110
00:05:34,920 --> 00:05:36,440
Speaker 2: I'm pointing over here behind me for those of you

111
00:05:36,520 --> 00:05:37,240
Speaker 2: who can't see me.

112
00:05:37,960 --> 00:05:38,280
Speaker 3: That's good.

113
00:05:38,360 --> 00:05:41,280
Speaker 2: Bloomberg News sits over there. Bloomberg News is Katanga Johnson.

114
00:05:41,320 --> 00:05:44,279
Speaker 2: Put out a piece that he said that Fed officials

115
00:05:44,320 --> 00:05:46,600
Speaker 2: are considering, with the next iteration of the Bosle three

116
00:05:46,760 --> 00:05:50,479
Speaker 2: D game, for a slight increase of capital requirements somewhere

117
00:05:50,520 --> 00:05:53,240
Speaker 2: around three to seven percent. Now, this sort of flies

118
00:05:53,279 --> 00:05:56,320
Speaker 2: amongst the idea of Okay, well, if you're looking at deregulation,

119
00:05:56,440 --> 00:06:00,240
Speaker 2: why is there an increase in capital requirements? Well, you

120
00:06:00,279 --> 00:06:02,200
Speaker 2: also have to keep in mind what the fed's other

121
00:06:02,279 --> 00:06:04,920
Speaker 2: plans are, and this specifically brings in what is known

122
00:06:04,920 --> 00:06:08,280
Speaker 2: as the g SIB surcharge. Currently, the g SIPs surcharge

123
00:06:08,320 --> 00:06:11,280
Speaker 2: is calculated under what's known as Method two. There's been

124
00:06:11,320 --> 00:06:14,240
Speaker 2: lots of discussions and lots of expectations amongst those of

125
00:06:14,320 --> 00:06:16,640
Speaker 2: us in DC that the FED is going to move

126
00:06:16,680 --> 00:06:20,000
Speaker 2: to a method one and if you have a combined

127
00:06:20,080 --> 00:06:23,320
Speaker 2: effort where the bosle three endgame increases capital requirements three

128
00:06:23,320 --> 00:06:26,359
Speaker 2: to seven percent and the GESIP surcharge moves to what

129
00:06:26,440 --> 00:06:27,560
Speaker 2: is known as method one.

130
00:06:28,080 --> 00:06:29,760
Speaker 3: All in all, according to Arnold.

131
00:06:29,560 --> 00:06:32,359
Speaker 2: Kakuda, our Blee eyes credit and senior credit analysts for

132
00:06:32,360 --> 00:06:34,479
Speaker 2: the banks, he put out a piece on the terminal

133
00:06:34,560 --> 00:06:37,239
Speaker 2: last week essentially saying, if you take those two things

134
00:06:37,279 --> 00:06:40,240
Speaker 2: into account, you're looking at for the g SIPs meaning

135
00:06:40,279 --> 00:06:43,400
Speaker 2: the big the top six, top eight US banks. This

136
00:06:43,520 --> 00:06:46,279
Speaker 2: is like Bank Bank of America JP, Morgan, Goldman, Sachs,

137
00:06:46,279 --> 00:06:48,800
Speaker 2: et cetera. You're looking at a net fifty eight billion

138
00:06:48,839 --> 00:06:50,960
Speaker 2: dollar capital reduction if.

139
00:06:50,800 --> 00:06:52,400
Speaker 3: You take those two rules and put them together.

140
00:06:52,440 --> 00:06:54,000
Speaker 2: So if you want to copy of that on the terminal,

141
00:06:54,080 --> 00:06:56,039
Speaker 2: just please feel free and I'll send that to you.

142
00:06:56,839 --> 00:06:59,040
Speaker 2: We also saw a proposal that came from the FED

143
00:06:59,080 --> 00:07:01,800
Speaker 2: Friday afternoon on stress testing. Think of this as the

144
00:07:01,880 --> 00:07:05,400
Speaker 2: Transparency stress testing proposal. The FED even said they don't

145
00:07:05,400 --> 00:07:08,800
Speaker 2: anticipate this impacting capital all that much, but just think

146
00:07:08,839 --> 00:07:11,400
Speaker 2: of this as providing banks a lot more transparents to

147
00:07:11,440 --> 00:07:14,000
Speaker 2: be able to what goes into the stress tests. In fact,

148
00:07:14,000 --> 00:07:16,880
Speaker 2: there's the scenario where the FED is asking the industry

149
00:07:16,920 --> 00:07:21,560
Speaker 2: for feedback on what's in the severely the severe as

150
00:07:22,160 --> 00:07:23,200
Speaker 2: the severe stress test.

151
00:07:23,200 --> 00:07:25,320
Speaker 3: I can't remember, I'm blanking on the name at the moment.

152
00:07:25,960 --> 00:07:27,840
Speaker 2: I'm gonna have a much more detailed thoughts on this

153
00:07:28,000 --> 00:07:31,400
Speaker 2: out probably on Wednesday, but again.

154
00:07:31,200 --> 00:07:32,680
Speaker 3: In the term, if you have any questions on that,

155
00:07:32,720 --> 00:07:35,600
Speaker 3: police feel free to reach out. A couple of other

156
00:07:35,640 --> 00:07:36,120
Speaker 3: things going on.

157
00:07:36,160 --> 00:07:38,760
Speaker 2: It's FED Treasury Secretary Scott Bessett literally just said a

158
00:07:38,760 --> 00:07:41,480
Speaker 2: few minutes ago that he had five individuals on his

159
00:07:41,720 --> 00:07:44,720
Speaker 2: list for the FED chair. This would be the current

160
00:07:45,080 --> 00:07:48,640
Speaker 2: FED Board Governor's Christopher Waller, Michelle Bowman, former FED Governor

161
00:07:48,720 --> 00:07:53,040
Speaker 2: Kevin worsh White House Docket, National Economic Council Director Kevin Hassett,

162
00:07:53,080 --> 00:07:57,600
Speaker 2: and Black Rock executive Rick Reader. That's what president, or

163
00:07:57,640 --> 00:08:00,000
Speaker 2: that's what Treasure's Secretary, Scott Bessont said on Air Force

164
00:08:00,120 --> 00:08:03,040
Speaker 2: One just a few minutes ago. He also said that

165
00:08:03,080 --> 00:08:06,600
Speaker 2: he would have his recommendation for this FED chair by

166
00:08:06,760 --> 00:08:09,960
Speaker 2: Thanksgiving to the President, and then President Trump later said

167
00:08:09,960 --> 00:08:12,240
Speaker 2: that he would potentially have that announcement out by the

168
00:08:12,360 --> 00:08:14,240
Speaker 2: end of the year, So just keep that in mind

169
00:08:14,240 --> 00:08:15,280
Speaker 2: when you're thinking FED chair.

170
00:08:15,720 --> 00:08:17,600
Speaker 3: You know, things are going to move really quick now

171
00:08:17,600 --> 00:08:19,440
Speaker 3: that we're going to be in November. Next week.

172
00:08:19,960 --> 00:08:25,600
Speaker 2: Other things going on, President Trump has nominated SEC official

173
00:08:25,680 --> 00:08:30,560
Speaker 2: Mike Selig to be the next CFTC chairman nominee the

174
00:08:30,600 --> 00:08:34,240
Speaker 2: next chairperson of the Commodity Futures Training Commission. Selig is

175
00:08:34,360 --> 00:08:37,920
Speaker 2: very much a crypto advisory He's part of the Cryptoadvisor

176
00:08:38,000 --> 00:08:40,360
Speaker 2: Group four chair actings over at the SEC at the moment.

177
00:08:40,640 --> 00:08:43,280
Speaker 2: So definitely a very good win I would call it

178
00:08:43,320 --> 00:08:46,480
Speaker 2: for the crypto industry. But I also think that the

179
00:08:46,559 --> 00:08:50,400
Speaker 2: CELIG has enough experience working at the CFTC to help

180
00:08:50,440 --> 00:08:52,400
Speaker 2: the CMEs and the ices of the world, so that

181
00:08:52,480 --> 00:08:55,000
Speaker 2: he could also talk about what's going on in the

182
00:08:55,040 --> 00:08:58,800
Speaker 2: derivative space as well. So again, you know, I thought

183
00:08:58,800 --> 00:09:00,719
Speaker 2: Brian Quintin's would be an easy shoe in for the

184
00:09:00,800 --> 00:09:04,240
Speaker 2: job when he was nominated for CFTC chair. But again

185
00:09:04,280 --> 00:09:07,199
Speaker 2: we'll see what happens with Mike Seelik. A couple of

186
00:09:07,240 --> 00:09:09,280
Speaker 2: other things going on. Senate Banking is going to have

187
00:09:09,280 --> 00:09:11,480
Speaker 2: a hearing later this week with Travis Hill. He's over

188
00:09:11,520 --> 00:09:14,160
Speaker 2: at the fdi C. This is his confirmation hearing. Probably

189
00:09:14,200 --> 00:09:15,839
Speaker 2: would get a little bit more insight on some of

190
00:09:15,880 --> 00:09:19,360
Speaker 2: the Capitol rules, Probably not a ton I'll watch, so

191
00:09:19,400 --> 00:09:20,960
Speaker 2: if you have any questions on that, feel free to

192
00:09:21,000 --> 00:09:23,200
Speaker 2: pick me and I'll make sure to give you the

193
00:09:23,200 --> 00:09:25,640
Speaker 2: insights of what's going on. We have a bunch of

194
00:09:25,720 --> 00:09:29,000
Speaker 2: senators who are actually doing negotiations on the National Defense

195
00:09:29,080 --> 00:09:30,439
Speaker 2: Authorization Act this week.

196
00:09:30,720 --> 00:09:31,920
Speaker 3: This is the NDAA.

197
00:09:32,880 --> 00:09:35,720
Speaker 2: We have a House NDAA, we also have a Senate NDAA.

198
00:09:36,360 --> 00:09:38,679
Speaker 2: The hope now is that even though the government is

199
00:09:38,679 --> 00:09:41,400
Speaker 2: shut down, there's a bipartisan group of senators that are

200
00:09:41,400 --> 00:09:41,960
Speaker 2: working on this.

201
00:09:42,080 --> 00:09:44,439
Speaker 3: The NDAA tends to not be political.

202
00:09:45,160 --> 00:09:48,600
Speaker 2: It's one of those This is the reauthorization for spending

203
00:09:48,640 --> 00:09:53,080
Speaker 2: for the Defense Department. Usually he's not political, but sometimes

204
00:09:53,120 --> 00:09:55,880
Speaker 2: obviously political macro political matters get involved.

205
00:09:56,240 --> 00:09:58,520
Speaker 3: But they're still working on it while the shutdown is gone.

206
00:09:58,600 --> 00:10:01,200
Speaker 2: So you know, they say that they're hoping to have

207
00:10:01,240 --> 00:10:04,760
Speaker 2: a framework by Thanksgiving, so again, stay tuned on that.

208
00:10:05,720 --> 00:10:07,640
Speaker 3: Let's talk about a couple of things about tariffs.

209
00:10:08,600 --> 00:10:11,520
Speaker 2: We have a Senate vote on a tariff resolution that's

210
00:10:11,559 --> 00:10:13,920
Speaker 2: going to be taking place later this week. This comes

211
00:10:13,960 --> 00:10:16,640
Speaker 2: from a bipartisan group of senators and a call bipartisan.

212
00:10:16,640 --> 00:10:19,800
Speaker 2: It's mostly Democrats plus one or two Republicans. This is

213
00:10:19,840 --> 00:10:23,080
Speaker 2: a resolution that would overturn President Trump's tariffs related to

214
00:10:23,120 --> 00:10:24,280
Speaker 2: Canada and Brazil.

215
00:10:24,320 --> 00:10:25,440
Speaker 3: And this has been done before.

216
00:10:25,760 --> 00:10:28,080
Speaker 2: This comes as what's known as a privileged resolution, so

217
00:10:28,120 --> 00:10:31,199
Speaker 2: you can put it on the floor without having leadership

218
00:10:31,200 --> 00:10:34,800
Speaker 2: buy into it. And this very could pass. It's passed

219
00:10:34,840 --> 00:10:37,240
Speaker 2: in the past. One time it failed due to absence

220
00:10:37,280 --> 00:10:39,400
Speaker 2: of votes, but they were just a bunch of senators

221
00:10:39,440 --> 00:10:42,040
Speaker 2: that weren't actually here in DC. But you know, even

222
00:10:42,080 --> 00:10:44,199
Speaker 2: if this passes and you see a headline later this

223
00:10:44,240 --> 00:10:48,199
Speaker 2: week says Senate votes on resolution to overturn President Trump's tariffs.

224
00:10:48,440 --> 00:10:49,880
Speaker 3: It's not it's symbolic.

225
00:10:50,520 --> 00:10:53,679
Speaker 2: The House has actually sort of changed its rules a

226
00:10:53,720 --> 00:10:55,600
Speaker 2: little bit so that there won't be a vote on

227
00:10:55,640 --> 00:10:58,240
Speaker 2: this in the House. And even it did, President Trump's

228
00:10:58,240 --> 00:10:59,959
Speaker 2: the one that would have to actually sign the resolution,

229
00:11:00,080 --> 00:11:02,200
Speaker 2: and again, it's not going to really go anywhere.

230
00:11:02,240 --> 00:11:04,920
Speaker 3: It's symbolic in nature. So if you see that headline,

231
00:11:04,960 --> 00:11:05,960
Speaker 3: just keep that in mind.

232
00:11:07,080 --> 00:11:09,800
Speaker 2: Finally, on the tariff stuff, you know, President Trump announced

233
00:11:09,800 --> 00:11:12,480
Speaker 2: that we we'd see an increase in ten percent tariffs.

234
00:11:12,120 --> 00:11:14,840
Speaker 3: On Canada, but we really don't know when that would

235
00:11:14,840 --> 00:11:15,319
Speaker 3: take place.

236
00:11:15,400 --> 00:11:19,719
Speaker 2: This was in response for advertisement from the Province of Ontario.

237
00:11:20,480 --> 00:11:23,080
Speaker 2: President Trump wasn't very happy about this. Announced that ten

238
00:11:23,080 --> 00:11:25,319
Speaker 2: percent increase in tariffs on Canada, but didn't say when

239
00:11:25,320 --> 00:11:27,800
Speaker 2: it was going to take place. He's not going to

240
00:11:27,840 --> 00:11:32,040
Speaker 2: be at this point meeting with Prime Minister Carney out

241
00:11:32,080 --> 00:11:36,000
Speaker 2: in Asia. Obviously he certainly can, and it's also his

242
00:11:36,360 --> 00:11:38,440
Speaker 2: you know, mantra to say I'm not going to meet

243
00:11:38,440 --> 00:11:41,400
Speaker 2: with somebody and then oops, we've met at this you know,

244
00:11:41,440 --> 00:11:42,839
Speaker 2: at this summit, so I wouldn't be.

245
00:11:42,760 --> 00:11:44,160
Speaker 3: Surprised if they ultimately meet.

246
00:11:44,240 --> 00:11:46,720
Speaker 2: But again, I'm just saying for our clients that are listening,

247
00:11:47,000 --> 00:11:49,200
Speaker 2: even though he's announced that ten percent, there's really no

248
00:11:49,280 --> 00:11:52,280
Speaker 2: timeline of when that would actually take place. And remember,

249
00:11:52,400 --> 00:11:54,800
Speaker 2: you know, November fifth, so next week we have a

250
00:11:54,840 --> 00:11:58,920
Speaker 2: Supreme Court oral argument on this related to his AEPA tariffs,

251
00:11:58,960 --> 00:12:01,480
Speaker 2: not the Fendel Tire era, but the i EPA tariffs.

252
00:12:01,520 --> 00:12:03,520
Speaker 2: And remember this is the Liberation Day tariffs where he

253
00:12:03,559 --> 00:12:04,920
Speaker 2: picked up the you know he was holding in the

254
00:12:04,960 --> 00:12:05,800
Speaker 2: Rose Garden all this.

255
00:12:06,440 --> 00:12:08,240
Speaker 3: You know, here's that's on November fifth.

256
00:12:08,480 --> 00:12:10,760
Speaker 2: President Trump has said that he plans to go to

257
00:12:10,840 --> 00:12:14,160
Speaker 2: the Supreme Court in person. You know, my colleague Hall

258
00:12:14,240 --> 00:12:16,600
Speaker 2: of Frome is going to be covering that right now.

259
00:12:16,640 --> 00:12:19,440
Speaker 2: She continues to say, sixty percent chance that the Supreme

260
00:12:19,440 --> 00:12:21,920
Speaker 2: Court is going to find those tariffs to be unlawful,

261
00:12:22,360 --> 00:12:26,080
Speaker 2: meaning that you can't do the reciprocal tariffs anymore. This

262
00:12:26,200 --> 00:12:27,720
Speaker 2: is what the Trade Court has found, this is what

263
00:12:27,760 --> 00:12:29,880
Speaker 2: the appeals Court has found. And this Holly's giving you

264
00:12:29,960 --> 00:12:32,840
Speaker 2: sixty percent chance to the Supreme Court. Now what happens

265
00:12:32,880 --> 00:12:35,160
Speaker 2: at that point, Well, Bloomberg News has an article that

266
00:12:35,240 --> 00:12:38,120
Speaker 2: put out and they are essentially calling it refund chaos.

267
00:12:38,600 --> 00:12:40,160
Speaker 3: Churge's Secretary Scott Bessett.

268
00:12:40,920 --> 00:12:43,600
Speaker 2: And fun fact, because I go on radio a lot,

269
00:12:43,600 --> 00:12:46,679
Speaker 2: I've always been saying Treasury Secretary Scott Bessett or President

270
00:12:46,720 --> 00:12:49,079
Speaker 2: Donald Trump. And I've been meeting with other lobbyists and

271
00:12:49,200 --> 00:12:51,520
Speaker 2: analysts around town, and I continue to say their titles

272
00:12:51,840 --> 00:12:52,560
Speaker 2: and they're laughing.

273
00:12:52,559 --> 00:12:55,120
Speaker 3: They're like, hey, I know, I know who best it is, but.

274
00:12:55,120 --> 00:12:59,520
Speaker 2: Apologies I always have to say Secretary Scott Bessett. But

275
00:12:59,640 --> 00:13:02,160
Speaker 2: when and actually was asked about this, he said, look,

276
00:13:02,200 --> 00:13:05,000
Speaker 2: we're going to refund approximately half of these tariffs that

277
00:13:05,040 --> 00:13:07,840
Speaker 2: we've brought in. You're looking at somewhere between eighty five

278
00:13:07,880 --> 00:13:10,200
Speaker 2: to one hundred and five billion dollars worth of tariffs

279
00:13:10,240 --> 00:13:12,600
Speaker 2: that there are going to be refunds for. But the

280
00:13:12,679 --> 00:13:16,079
Speaker 2: question is it's refund chaos. I actually don't think the

281
00:13:16,120 --> 00:13:19,040
Speaker 2: government has a way to issue refunds other than checks.

282
00:13:19,200 --> 00:13:22,200
Speaker 2: I'm looking into this a little bit more, and so

283
00:13:22,640 --> 00:13:25,800
Speaker 2: I would not anticipate a refund program that's going to

284
00:13:25,840 --> 00:13:28,480
Speaker 2: be very efficient, especially while the government is shut down.

285
00:13:28,920 --> 00:13:30,920
Speaker 2: So if you get into a situation where the Supreme

286
00:13:30,960 --> 00:13:33,959
Speaker 2: Court says, now, now you got to refund this, you're

287
00:13:33,960 --> 00:13:35,840
Speaker 2: going to most likely be hit with refund chaos.

288
00:13:35,880 --> 00:13:37,040
Speaker 3: So just keep that in mind.

289
00:13:37,440 --> 00:13:41,000
Speaker 2: And again nothing prevents President Trump from going back forth

290
00:13:41,040 --> 00:13:43,280
Speaker 2: and saying, look, if I can't use an IEPA tariff,

291
00:13:43,520 --> 00:13:45,080
Speaker 2: well then I'm going to use a Section two thirty

292
00:13:45,080 --> 00:13:47,000
Speaker 2: two tariff or a Section three oh one tariff, and

293
00:13:47,000 --> 00:13:49,840
Speaker 2: we're just going to do this different ways. So again,

294
00:13:50,320 --> 00:13:52,320
Speaker 2: you know, keep that in mind. And the last thing

295
00:13:52,320 --> 00:13:54,320
Speaker 2: I want to point out is you could potentially get

296
00:13:54,360 --> 00:13:57,920
Speaker 2: a little bit of oh and I'll get to that question.

297
00:13:57,920 --> 00:13:59,880
Speaker 2: That's a great question on the farmer stimulus. I'll get

298
00:13:59,880 --> 00:14:02,600
Speaker 2: to that in a second. You may see some AI

299
00:14:02,679 --> 00:14:05,200
Speaker 2: news coming out of Washington this week, more from the

300
00:14:05,240 --> 00:14:08,679
Speaker 2: industry perspective as opposed to from the White House. There

301
00:14:08,760 --> 00:14:11,360
Speaker 2: is a significant AI conference that's being held over at

302
00:14:11,360 --> 00:14:13,600
Speaker 2: the Capitol or at the Convention Center.

303
00:14:13,640 --> 00:14:15,160
Speaker 3: It's just a few blocks from here of us at

304
00:14:15,160 --> 00:14:16,640
Speaker 3: the office. We like the joke.

305
00:14:16,720 --> 00:14:18,520
Speaker 2: We don't like it when these big conferences go on

306
00:14:18,559 --> 00:14:21,720
Speaker 2: because then the line at pot Bellies just becomes absolutely.

307
00:14:21,920 --> 00:14:22,760
Speaker 3: You know, astromic.

308
00:14:23,280 --> 00:14:24,880
Speaker 2: But you know, there is going to be this AI

309
00:14:24,960 --> 00:14:27,920
Speaker 2: conference you know in the video is going to be there.

310
00:14:28,240 --> 00:14:30,640
Speaker 2: There's going to be a lot of significant AI leaders there.

311
00:14:30,880 --> 00:14:33,800
Speaker 2: So we're looking for potentially some headlines to come out

312
00:14:33,840 --> 00:14:36,600
Speaker 2: from the industry at this conference. But it just shows

313
00:14:36,600 --> 00:14:39,360
Speaker 2: you how important Washington is to the AI sector. Is

314
00:14:39,360 --> 00:14:41,880
Speaker 2: the fact that they chose Washington to be the convention

315
00:14:42,000 --> 00:14:44,120
Speaker 2: place just steps from the White House.

316
00:14:44,520 --> 00:14:46,080
Speaker 3: So again, keep that in mind.

317
00:14:46,360 --> 00:14:50,240
Speaker 2: Now, the question that came in from the chat, could

318
00:14:50,240 --> 00:14:52,480
Speaker 2: that be why they haven't sent farmer stimulus.

319
00:14:52,520 --> 00:14:53,400
Speaker 3: This is a great question.

320
00:14:53,520 --> 00:14:56,240
Speaker 2: So, you know, as you can imagine, you know, the

321
00:14:56,560 --> 00:14:59,160
Speaker 2: farming industry has been somewhat hurting at the moment just

322
00:14:59,240 --> 00:15:01,840
Speaker 2: because there's a lot supply for a variety of factors.

323
00:15:01,840 --> 00:15:04,440
Speaker 2: In fact, our analyst Mike mcgloone who does the commodities,

324
00:15:04,480 --> 00:15:06,560
Speaker 2: he's down in Miami. He just put out a piece

325
00:15:06,600 --> 00:15:08,920
Speaker 2: this morning about soybeans, because you know, soybeans is one

326
00:15:08,960 --> 00:15:11,240
Speaker 2: of the things that the US China relationship that a

327
00:15:11,280 --> 00:15:14,200
Speaker 2: lot of farmers are hoping for. He's also just put

328
00:15:14,240 --> 00:15:16,560
Speaker 2: out He's like, look, even if the United States and

329
00:15:16,640 --> 00:15:19,120
Speaker 2: China announce an agreement on soybeans, there's a lot of

330
00:15:19,120 --> 00:15:22,240
Speaker 2: soybeans that are actually already in there in terms of

331
00:15:22,280 --> 00:15:25,760
Speaker 2: supply coming out of Brazil at the moment. So again,

332
00:15:26,000 --> 00:15:28,440
Speaker 2: farmers in the United States have been asking for a

333
00:15:28,480 --> 00:15:30,360
Speaker 2: lot of you know, I don't want.

334
00:15:30,200 --> 00:15:31,560
Speaker 3: To call it aid because they don't want to call it.

335
00:15:31,920 --> 00:15:33,400
Speaker 2: They don't want to be at they don't want to

336
00:15:33,440 --> 00:15:36,240
Speaker 2: ask for aid, but they're looking for policies that will

337
00:15:36,240 --> 00:15:40,200
Speaker 2: actually allow these soybeans to be purchased, and in response,

338
00:15:40,320 --> 00:15:42,280
Speaker 2: the USDA and the White House has cut up mount

339
00:15:42,320 --> 00:15:44,400
Speaker 2: and said that they were going to announce a farmer

340
00:15:44,480 --> 00:15:48,880
Speaker 2: aid program. Now they've voted, they've floated the idea of

341
00:15:48,920 --> 00:15:52,880
Speaker 2: around ten to thirteen billion dollars in aid. If you

342
00:15:52,920 --> 00:15:55,360
Speaker 2: remember back in twenty eighteen and twenty nineteen, there was

343
00:15:55,400 --> 00:15:58,320
Speaker 2: a program that actually paid out twenty three billion dollars.

344
00:15:58,800 --> 00:16:01,520
Speaker 2: Some of the House agg Committee members on the Republican

345
00:16:01,600 --> 00:16:03,680
Speaker 2: side have said that farmers could use up to about

346
00:16:03,720 --> 00:16:06,360
Speaker 2: fifty billion dollars in eight So we do think that

347
00:16:06,400 --> 00:16:11,440
Speaker 2: this is coming, but the USDA has said that it's

348
00:16:11,480 --> 00:16:14,560
Speaker 2: not going to come out until after the government shutdown ends.

349
00:16:14,880 --> 00:16:16,120
Speaker 3: Now, they have taken some steps.

350
00:16:16,120 --> 00:16:19,240
Speaker 2: They've reopened some of the Farm Service Agency offices, They've

351
00:16:19,360 --> 00:16:21,480
Speaker 2: reopened a couple of the loan programs that are going

352
00:16:21,520 --> 00:16:24,880
Speaker 2: on with farmers. But this thirteen billion dollars in stimulus

353
00:16:24,920 --> 00:16:27,600
Speaker 2: as of right now, they said, is not going to

354
00:16:27,600 --> 00:16:30,080
Speaker 2: come out until the end of the shutdown. Now, if

355
00:16:30,160 --> 00:16:32,840
Speaker 2: the shutdown lasts so Thanksgiving, I could see potentially that

356
00:16:33,040 --> 00:16:36,200
Speaker 2: changes things. But that's why they haven't sent this farmers

357
00:16:36,200 --> 00:16:39,200
Speaker 2: stimulus at this point. So with that, I'm going to

358
00:16:39,240 --> 00:16:41,200
Speaker 2: say thank you very much for attending. I apologize that

359
00:16:41,280 --> 00:16:43,560
Speaker 2: we went about five minutes over. Even though I didn't

360
00:16:43,560 --> 00:16:44,920
Speaker 2: think we were going to have much to say, We'd

361
00:16:44,920 --> 00:16:46,760
Speaker 2: had quite a bit to say. So if you do

362
00:16:46,880 --> 00:16:48,560
Speaker 2: have any questions in the interim, please feel free to

363
00:16:48,600 --> 00:16:51,640
Speaker 2: reach out ib me, send me an email, let's talk.

364
00:16:51,960 --> 00:16:54,040
Speaker 2: If not, have a wonderful week and we'll talk soon.

365
00:16:56,560 --> 00:17:00,400
Speaker 1: Our thanks to Nathan Dean, Bloomberg Intelligence Senior policy analyst,

366
00:17:00,480 --> 00:17:04,159
Speaker 1: bringing you the latest installment of his weekly Washington Policy Pulse.

367
00:17:04,560 --> 00:17:07,359
Speaker 1: For more from BI or to join this call live

368
00:17:07,560 --> 00:17:11,240
Speaker 1: each week, you can email Nathan at ndan at Bloomberg

369
00:17:11,320 --> 00:17:14,560
Speaker 1: dot net. That's n d e a n at Bloomberg

370
00:17:14,600 --> 00:17:17,240
Speaker 1: dot net and come back to the podcast later today

371
00:17:17,520 --> 00:17:19,520
Speaker 1: for the latest edition of Balance of Power