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Speaker 1: Bloomberg Audio Studios, Podcasts, radio News.

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Speaker 2: This is the Bloomberg Surveillance Podcast. I'm Jonathan Ferrow, along

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Speaker 2: with Lisa Bromwitz and Amrie Hordern. Join us each day

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Speaker 2: terminal and the Bloomberg Business app. Search for nor data.

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Speaker 2: We've pulled you a quote, Neil. I want to share

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Speaker 2: the quote with our audience and get your response to it.

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Speaker 2: I'm seeing a lot of wildly optimistic takes out there.

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Speaker 2: Almost feels like people are allowing a political narrative to

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Speaker 2: cloud their analysis of the data. The fact is conditions

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Speaker 2: are getting worse, not better. There will be a time

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Speaker 2: to be bullish. I'm not sure now is the time

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Speaker 2: the Fed should go fifty when they can not when

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Speaker 2: they must now, Neil, the obvious thing to jump off

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Speaker 2: the page there there's a couple, but the political one's interesting.

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Speaker 2: What is your view on that? Are you suggesting that

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Speaker 2: there's some economists sound there, maybe even FED officials that

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Speaker 2: have got a political narrative. What's that line about?

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Speaker 3: Well, not feed officials really, but you know, certain economists

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Speaker 3: on the street are sounding like that. I mean, the

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Speaker 3: same folks that told us, you know, are at a

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Speaker 3: sustainably higher run rage for employment with two hundred thousand

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Speaker 3: because of immigration, and now all of a sudden telling

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Speaker 3: us that.

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Speaker 4: Well, don't worry about it.

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Speaker 3: One hundred thousand is fine because that's what full employment

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Speaker 3: looks like.

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Speaker 4: I mean, it's a bit ridiculous, don't you think, Well, hold.

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Speaker 1: On a second meal, because this is actually something that

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Speaker 1: I've given quite a bit of thought to. Are you

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Speaker 1: accusing the current status quo opinion on Wall Street that

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Speaker 1: recession is not imminent as a political construct designed to

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Speaker 1: help the incumbent Democratic Party.

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Speaker 3: I don't think, well, I mean, I know, I don't

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Speaker 3: think that that's the accusation. I think that there are

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Speaker 3: certain quarters of people that I don't know, maybe they're

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Speaker 3: joking for jobs in administration, who knows. I mean, but

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Speaker 3: I do think that there's a I mean, look, no

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Speaker 3: one needs to talk to me about being optimistic. I'm

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Speaker 3: one of the most optimistic people historically that's been.

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Speaker 4: On the street.

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Speaker 2: Me too.

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Speaker 3: You can't help yourself. But wonder these wildly optimistic takes seem.

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Speaker 4: A little bit out of place. I mean, this notion that.

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Speaker 3: You know, this is soft landing, this is boring. Things

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Speaker 3: are good, hooray, we're at full employment. I mean, at

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Speaker 3: the end of the day, up is up and down

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Speaker 3: is down. Okay, I mean it's really that simple.

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Speaker 1: Okay, But what is sort of the base case, Neil

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Speaker 1: that you're talking about here in terms of where people

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Speaker 1: are getting it wrong? How bad do you think it

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Speaker 1: actually is? And why do you then think that the

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Speaker 1: Fed should go twenty five basis points rather than fifty

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Speaker 1: basis points, even though everyone on the street doesn't seem

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Speaker 1: to think it's that bad.

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Speaker 4: Well, I think things are getting worse.

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Speaker 3: I mean, at the end of the day, since Powell

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Speaker 3: talked about we don't seek or welcome further cooling in

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Speaker 3: the labor market. Literally every single labor market indicator that's

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Speaker 3: come out has been worse than expected. ADP, the non

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Speaker 3: farm payroll number, job vacancies, the regional manufacturing employment indicators,

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Speaker 3: the ISM employment indicators.

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Speaker 4: I mean, the labor differential from the conference board.

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Speaker 3: Literally, you can go on and on and on, and

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Speaker 3: you know, we're told to say, oh, well, don't worry,

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Speaker 3: layoffs are low, as if that's a leading indicator of

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Speaker 3: the labor market to begin with, which it's not, by

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Speaker 3: the way, I mean, the hiring rate has collapsed.

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Speaker 4: You know, I mentioned immigration before.

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Speaker 3: Look at college unemployment rates. The unemployment rate for people

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Speaker 3: with a bachelor's degree, that's half a percentage point higher

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Speaker 3: than it was the same month in twenty nineteen.

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Speaker 4: Right, So how does immigration explain that?

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Speaker 3: So I think it's a little bit you know, off putting, frankly,

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Speaker 3: and to the extent that you know, I think for me,

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Speaker 3: I think the important story is that I think the

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Speaker 3: economy is evolving in a way that the FED may

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Speaker 3: not be anticipating. And to the extent that that's true,

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Speaker 3: I think it creates the risk of an accident later,

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Speaker 3: which is something we've been arguing obviously since June. And

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Speaker 3: the only reason to expect fifty and yes, I still

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Speaker 3: believe that a fifty basis point rapecut is possible at

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Speaker 3: the September meeting.

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Speaker 4: That's our call to our clients.

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Speaker 3: Is because of Jerome Powell we can talk about Waller,

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Speaker 3: New York Fed President Williams. All Jerome Powell needs to

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Speaker 3: do is get out there and before his colleagues around

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Speaker 3: that table and say I think we should go fifty,

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Speaker 3: and they'll all fall into place. And in fact, a

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Speaker 3: lot of the people on the street that have twenty

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Speaker 3: five basis point radcut calls, they'd have no problem with

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Speaker 3: the Fed going fifty either.

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Speaker 5: But Neil, how political could it be for the Fed

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Speaker 5: to go fifty if Jerome Powell is the one almost

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Speaker 5: dictating it, not a consensus building from the ground up.

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Speaker 3: I mean, I think that a consensus would come around

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Speaker 3: to the chairman, I mean, Henry, if they didn't go

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Speaker 3: fifty and they only go twenty five, and that potentially

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Speaker 3: fuels bets that the FED will be behind the curb

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Speaker 3: later and then we're talking about in larger moves after

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Speaker 3: the election.

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Speaker 4: How would that not be political?

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Speaker 3: It's I mean to me, they have full clearance to

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Speaker 3: go fifty as it is, And I do find this

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Speaker 3: sort of argument, Well, if they go fifty to start, it.

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Speaker 4: Would be a panic that would be a panic move. Well,

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Speaker 4: by that logic, maybe they shouldn't go at all.

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Speaker 3: Show so much so so much confidence in the market

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Speaker 3: that it's why not just not do anything?

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Speaker 5: Then, Neil, we know you think they should go fifty.

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Speaker 5: What do you actually think they will do?

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Speaker 4: I told you I.

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Speaker 3: Think they will go fifty because I think Jerome Powell

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Speaker 3: is going to give them a license to go fifty.

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Speaker 4: I think he thinks that they should go fifty.

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Speaker 2: So now let's build on that the kind of communication

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Speaker 2: you're expecting September eighteenth, together with the signal we could

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Speaker 2: get from the projections in the SCP as well. Do

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Speaker 2: they characterize that as a mid cycle adjustment, a rush

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Speaker 2: to get to neutral? How do you think they'll frame

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Speaker 2: that move.

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Speaker 3: I think that they'll go fifty and they'll say that

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Speaker 3: they're willing to do more so long to stabilize the

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Speaker 3: labor market.

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Speaker 4: That's how thyough. That's how they'll they'll they'll frame it.

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Speaker 3: They'll say that the inflation story is over, inflation has

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Speaker 3: been quelled, and we'd like to stabilize labor market conditions

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Speaker 3: at our estimates of full employment.

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Speaker 1: Will you feel better if there's descent on the FMC.

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Speaker 3: Yeah, I mean, I do think that the consensus building

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Speaker 3: nature of the FED historically is it creates an institutional

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Speaker 3: bias for them to be late. There are lots of

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Speaker 3: central banks all over the world that have more descents.

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Speaker 3: And you know, I mean, who are we really to

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Speaker 3: I mean, if you're Jerome Powell, I mean to me,

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Speaker 3: it's like, okay, someone's dissenting, So what I mean, who cares?

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Speaker 3: I mean some of these people that'll that will dissent

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Speaker 3: have been absolutely wrong about the overall tone of the

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Speaker 3: data for the last six months. I mean, if Mickey

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Speaker 3: Bauman disint is descents, is that really a big deal?

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Speaker 3: I mean to me, it's like, I mean, it's not.

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Speaker 3: It's not It's like being you know, kicked by a

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Speaker 3: lesser then, so I think it's it's sort of it's

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Speaker 3: sort of not really worth trying to build consensus in

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Speaker 3: that regard, especially when they've been rolled wrong about the

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Speaker 3: overall slope of the data. I mean, some of these

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Speaker 3: people also have been completely headfaked by Q one inflation, right,

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Speaker 3: I mean so true. Look, so I just what's the

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Speaker 3: point of building consensus with people that have been absolutely

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Speaker 3: wrong about the overall slope of the data for the

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Speaker 3: last you know, three six nine months.

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Speaker 2: Now you've said it. Whoever, the sins. We're going to

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Speaker 2: say they're auditioning. No, thank you, sir, No datta runmack

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Speaker 2: a free shared it just the clinic has always from Neil.

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Speaker 2: We begin with our top story, Stock's looking to snap

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Speaker 2: a four day losing street following Friday's payrolls report. Jim

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Speaker 2: Bianco of Bianco Research is not buying the gloom. I'm

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Speaker 2: a no leander. I still do not see a broad

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Speaker 2: slow down in the economy. The labor market is showing

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Speaker 2: signs of cooling, but these may be measurement problems. Jim

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Speaker 2: joined us now for more. So, Jim, let's go to

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Speaker 2: the bond market first, Why is everyone bullish bomb? It's

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Speaker 2: given what you just said, because.

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Speaker 6: The Fed's going to cut rates and they're going to

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Speaker 6: lower financing costs, and we're having a debate between twenty

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Speaker 6: five and fifty basis points. And I might add too,

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Speaker 6: when you set everyone's bullish bonds. If you look at

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Speaker 6: most of the surveys, whether you're talking about the BFA

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Speaker 6: Global Fund Manager Survey or the Commitment of Traders Report,

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Speaker 6: we've got some record bullishness across the board in the

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Speaker 6: bond market. So everybody's positioned for a continued fall in

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Speaker 6: interest rates, and usually when they get that extreme, you're

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Speaker 6: very close to the end of the move.

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Speaker 2: So, Jim, you said these measurement problems, can you walk

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Speaker 2: me through what you meant plant that.

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Speaker 6: Remember that when we do the survey, when we do payrolls,

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Speaker 6: when we look at employment in the United States, we

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Speaker 6: do surveys, and those surveys are adjusted by population growth.

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Speaker 6: The population growth in the United States has exploded higher

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Speaker 6: in the last three years or so because of migration.

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Speaker 6: We've gone from about one point two percent population growth

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Speaker 6: in twenty twenty to one point one percent population growth,

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Speaker 6: and that's a gigantic move for that. And so all

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Speaker 6: these surveys are being adjusted by population growth, and we

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Speaker 6: have to ask the question as to whether or not

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Speaker 6: we're actually measuring it correctly. If we had stable population,

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Speaker 6: the answer would probably be yes. But under this flux

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Speaker 6: of population that we've seen, you know, there's a lot

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Speaker 6: of questions, and I think it really comes down to

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Speaker 6: more in the household survey, where the unemployment rate is

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Speaker 6: measured less so on the payroll survey.

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Speaker 1: You're speaking in tandem with your no landing compatriot over

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Speaker 1: at Apollo, Torsten Slack, who put out research over the

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Speaker 1: weekend pointing to just response rates, declining that the current

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Speaker 1: population survey has gone from about a ninety percent response

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Speaker 1: rate in twenty twelve to about a seventy percent response

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Speaker 1: rate today. I'm just wondering, Jim, what gives you confidence

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Speaker 1: that the lack of clarity that we're getting speaks to

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Speaker 1: bullishness and not bearishness in the labor market.

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Speaker 6: Because when you look beyond the labor market and let's

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Speaker 6: take a look at consumption or retail sales, retail sales

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Speaker 6: has beaten the Wall Street estimate twenty five the last

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Speaker 6: thirty one months, and the consumption numbers are very strong,

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Speaker 6: especially where they were pre pandemic. And so what that

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Speaker 6: says is that there's a lot of spending going on

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Speaker 6: in this economy. Well, what's the big driver of spending

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Speaker 6: is income and must mean that there's a lot of

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Speaker 6: jobs out there. People have a lot of income. Yes,

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Speaker 6: the savings rate has been falling, and that can explain

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Speaker 6: some of it, but not all of it. Now, I

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Speaker 6: think what it does do is it masks The payroll

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Speaker 6: report and the household survey are masking the jobs that

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Speaker 6: are created that you actually are seeing in like the

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Speaker 6: retail sales and the consumption numbers because of how high

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Speaker 6: and strong they are.

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Speaker 1: That said, we are seeing some real weakness. When you

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Speaker 1: talk to executives of retail companies or beyond, they all

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Speaker 1: talk about how they are seeing more choicefulness if you

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Speaker 1: like that word. I think it's a little confusing, but

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Speaker 1: people are being more discerning and how much money they spend.

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Speaker 1: Where do you place that in this trajectory of no

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Speaker 1: landingness that you see.

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Speaker 6: Well, the economy when it grows, you know, if you

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Speaker 6: look historically at all of the cycles to use this

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Speaker 6: toatistical term, it has a wide standard deviation, So it

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Speaker 6: might grow at two two and a half percent, but

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Speaker 6: you'll have quarters in there where it might grow less

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Speaker 6: than one and quarters that it grows more than three.

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Speaker 6: And I think what we're seeing with that discrimination among

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Speaker 6: consumers and especially don't forget that it's an election season

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Speaker 6: two and that has a big effect on them, that

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Speaker 6: we're seeing probably more of that normal noise that you

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Speaker 6: would see around an economy that is growing nearer at potential. Yeah,

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Speaker 6: we had some quarters late last year when we were

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Speaker 6: growing at three or four percent. We had a very

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Speaker 6: weak first quarter this year, we're looking at low two's

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Speaker 6: probably for the third quarter on GDP growth. So that's

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Speaker 6: kind of in the normal range of things you would

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Speaker 6: see with the economy. But add it all up, average

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Speaker 6: it out, and it does look like an economy that

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Speaker 6: is not at risk of recession at this point.

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Speaker 5: What's the biggest catalyst though that could have you maybe

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Speaker 5: back off as no landing scenario.

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Speaker 6: Probably if the inflation rate were to continue to move lower.

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Speaker 6: Now I'm on for our arguments. Say care, I'm going

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Speaker 6: to use a year over year CPI.

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Speaker 4: In June of.

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Speaker 6: Twenty three, it was three percent, and everybody said we're

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Speaker 6: on the last mile. Well, now it's two point nine.

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Speaker 6: It's taken fourteen months to go from three percent to

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Speaker 6: two point nine, and it did make a move to

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Speaker 6: towards three point seven percent in the middle, there hasn't

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Speaker 6: been much progress in terms of inflation moving lower. If

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Speaker 6: you look at like Cleveland fed mediaan CPI, or you

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Speaker 6: look at the Dallas trimmean PCE numbers, these I think

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Speaker 6: are better core measures of inflation than ex food and energy.

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Speaker 6: Those numbers have kind of stalled out too at very

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Speaker 6: high levels. If the economy is really slowing. We should

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Speaker 6: see the inflation numbers continue to move lower, and we haven't.

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Speaker 6: We've seen them settle out at a late rate, well

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Speaker 6: above where the Fed wants, and we just assume that

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Speaker 6: they're going to move lower. So if they do start

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Speaker 6: to move lower, then I would start to say, then

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Speaker 6: there is some broad based weakness.

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Speaker 5: So you have concerned that potentially or do you have

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Speaker 5: concern that a rate cut would mean somewhat potentially reacceleration

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Speaker 5: of inflation.

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Speaker 6: Yeah, that's my biggest concern. I'm in the camp that

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Speaker 6: the new inflation rate is somewhere between three and four percent,

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Speaker 6: and I might add that's exactly what it's been for

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Speaker 6: as I mentioned before, the last fourteen months or so,

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Speaker 6: between three and four percent. And whether or not we

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Speaker 6: get a Harris or a Trump administration after the election,

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Speaker 6: it looks like we're going to have spending, we might

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Speaker 6: have tariffs, and we're going to see a big fiscal

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Speaker 6: response out of the federal government. You added to that

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Speaker 6: easy monetary policy, and yeah, I could see where we

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Speaker 6: could be looking at the second half of twenty five

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Speaker 6: and talking about a reassurgent, a reacceleration of inflation, not

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Speaker 6: to nine percent or anything like that, but solidly staying

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Speaker 6: above that three percent level and being very worrisome for

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Speaker 6: a FED that's got a target of two percent and

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Speaker 6: said that they will get to that target of two percent.

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Speaker 2: So, Jim, this riises some big, big questions about the

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Speaker 2: projections that we get next week in the SAP the

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Speaker 2: summary if they can projections, and I can share with

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Speaker 2: you where CPI is right now in those projections called

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Speaker 2: PSEA two point eight percent for twenty four, two point

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Speaker 2: three for twenty five, two percent for twenty six. Can

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Speaker 2: you share with us why you think that will be

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Speaker 2: come next Wednesday on how high they be provised up

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Speaker 2: by the time it gets to twenty twenty five.

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Speaker 6: Well, I don't think next Wednesday that those numbers for

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Speaker 6: at least for twenty five and twenty six are going

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Speaker 6: to get revised much. But the story with the FED

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Speaker 6: SEP is always the two year out numbers, always at

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Speaker 6: two percent, and then as that two year number becomes

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Speaker 6: one year and six months, they start to revise it higher.

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Speaker 6: And I think that that's going to be probably more

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Speaker 6: of the same when it comes to where the FED is.

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Speaker 6: And let's remember in June the FED did acknowledge that

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Speaker 6: there is a base effect in the inflation numbers, meaning

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Speaker 6: that the seasonal data, the seasonal factors are turning positive,

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Speaker 6: meaning they're going to push the numbers up through the

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Speaker 6: second half of the year, which is why back in

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Speaker 6: June they upped their forecast to two point six percent

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Speaker 6: for twenty twenty four. So I don't suspect we're going

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Speaker 6: to see a lot of movement in the twenty four number.

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Speaker 6: Probably the twenty sixth number will stay at zero excuse me,

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Speaker 6: a two percent or right on their target. So you

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Speaker 6: know that's going to be the key though, is whether

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Speaker 6: or not the inflation rate does move down.

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Speaker 2: Jim, this was great, Jimpianco at Pianco Research. Jim, thank you, buddy.

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Speaker 2: But here's the latest Republican presidential nominee Donald Trump threatening

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Speaker 2: one hundred percent tariffs on countries who shift away from

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Speaker 2: the US dollar. The comments coming at a rally in

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Speaker 2: the battleground state of Wisconsin. The latest polling showing the

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Speaker 2: race and a dead heat, with momentum beginning to shift

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Speaker 2: in the form of President's favor. Johining us Now round

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Speaker 2: the table. Congressman Frenchhill of Arkansas Congressman. Good to see you, sir.

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Speaker 2: Good morning, Jonathur grew to be with you. I know

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Speaker 2: you're in town for the Barkley's Global Financial Services Conference,

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Speaker 2: and we can talk about regulation a little bit later.

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Speaker 2: First of all, the big challenge, can you translate that?

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Speaker 2: Was that vibes or policy? Because that's been the criticism

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Speaker 2: of the other side. What was that?

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Speaker 7: I think is President Trump having a good time at

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Speaker 7: a rally. Because back when William McKinley was president, of course,

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Speaker 7: we financed the whole federal government through tariffs. That was

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Speaker 7: the principal source of federal revenue. I don't think that's

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Speaker 7: a relevant issue. I think the biggest risk to the

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Speaker 7: dollar being the principal reserve currency of the world is

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Speaker 7: really our own fiscal situation. We're not going to be

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Speaker 7: supplanted by a group of countries who want to replace

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Speaker 7: the dollar. In my view, Instead, the biggest risk is

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Speaker 7: our own sustainable fiscal situation.

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Speaker 2: Do you see an agenda a campaign that's willing to

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Speaker 2: address that on the Republican side, Well, I.

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Speaker 7: Don't see an agenda to address that in either political party.

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Speaker 7: It's been concerning to a lot of members of Congress

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Speaker 7: because to get our country in a sustainable fiscal situation.

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Speaker 7: We need to make long term reforms to our mandatory

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Speaker 7: spending programs such as veterans benefits or Social Security or Medicare,

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Speaker 7: and healthcare costs drive a lot of that non sustainable finance.

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Speaker 7: But that can only be done, you know, on a

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Speaker 7: bipartisan basis, and it's been attempted on and off for

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Speaker 7: forty years, with really only one material change, which was

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Speaker 7: Ronald Reagan's work with then Democratic Speaker Tip O'Neil to

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Speaker 7: perform Social Security back in eighty three and eighty four.

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Speaker 7: But it's that kind of targeted by partson approach I

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Speaker 7: think we need, and all we're doing is trying to

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Speaker 7: lower the growth rate of those programs over a long term.

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Speaker 7: Because we have the best economy, the best rule of

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Speaker 7: law system, the best litigation and legal court system in

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Speaker 7: the world, and we have the best banking and capital

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Speaker 7: market system in the world. Those are all in dsha

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Speaker 7: of a good reserve currency. But you also want global

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Speaker 7: confidence and domestic confidence in a long term sustainable fiscal situation.

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Speaker 5: Speaking of confidence, are confident that the government will not

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Speaker 5: shut down? We're facing a government shut down September thirtieth,

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Speaker 5: and you'll be back in DC for about three weeks, right,

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Speaker 5: that's it to really hammer this out.

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Speaker 7: Well, I Amory, I'm I am confident that we won't have

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Speaker 7: a government shut down because we're just a few weeks

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Speaker 7: away from a national election, and I don't think that

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Speaker 7: benefits anybody running for reelection. So I think we will

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Speaker 7: navigate the need for a continuing resolution to get fiscal

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Speaker 7: twenty five spending moved to beyond the election. And in

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Speaker 7: the House we've gotten seventy percent of funding passed and

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Speaker 7: across the House floor. Over in the Senate, they've not

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Speaker 7: gotten across the Senate floor spending. So we're going to

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Speaker 7: be confronted with a CR. But I do think we'll

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Speaker 7: get that down before September thirtieth.

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Speaker 5: I guess my question is, then, is this a CR

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Speaker 5: that's clean? Because Schumer put out a Dear colleague letter

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Speaker 5: last night talking about the fact that there can't be

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Speaker 5: any poison pills in it. Will it be a clean

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Speaker 5: CR that Republicans and Democrats can agree to? You is

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Speaker 5: just basically funding the government until the end of the year.

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Speaker 7: That may be ultimately what happens, but I think Speaker

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Speaker 7: Johnson proposed that we do a clean r with three editions,

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Speaker 7: some disaster money that's needed, some two Virginia Class submarines

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Speaker 7: be added into it, and then finally the Save Act,

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Speaker 7: which would be a Republican proposal what passed the House

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Speaker 7: with bipartisan support, reminding states that only citizens can vote

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Speaker 7: in federal elections and giving the states some guidance on

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Speaker 7: how to make sure that's the case. With nearly ten

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Speaker 7: million people in the country, of a huge majority of

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Speaker 7: which are not citizens, audits have found some non citizens

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Speaker 7: attempting to vote in federal elections. It's a big issue.

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Speaker 7: When I was home in Arkansas just the last few weeks,

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Speaker 7: it came up at time and time again at events

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Speaker 7: that I went to, So people are concerned about that.

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Speaker 7: Speaker Johnson proposes that we put that bill, the Save Act,

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Speaker 7: attached to the CR.

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Speaker 5: Yeah, it doesn't look like the Senate's willing to take

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Speaker 5: that up. Given the fact that after this is going

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Speaker 5: to be all about politics. What are you when your

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Speaker 5: colleagues discus, when you look down ballot, the fact that

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Speaker 5: Democrats are just absolutely trouncing Republicans when it comes to fundraising,

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Speaker 5: especially in the House.

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Speaker 7: Well, our candidates, both our challengers and our incumbents had

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Speaker 7: excellent hard money fundraising up until the summer, so they

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Speaker 7: were leading their Democratic opponents across the board through the

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Speaker 7: summer fundraising. So I think that first eighteen months of

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Speaker 7: the cycle, I think our incumbents and our challengers did very,

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Speaker 7: very well. Democrats have had some momentum in the last

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Speaker 7: few weeks to catch up, but now the rubbers hitting

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Speaker 7: the road, and I think we've got adequate funding in

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Speaker 7: the House to hold the House pick up seats, and

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Speaker 7: I feel optimistic about the Senate as well.

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Speaker 1: You were talking about the deficit and how that's your

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Speaker 1: biggest concern more than say, countries that are looking for alternatives.

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Speaker 6: To the dollar.

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Speaker 1: Do you think that this country can afford a fifteen

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Speaker 1: percent corporate tax rate given the fact that already we're

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Speaker 1: kind of struggling to bridge back GOP.

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Speaker 7: Well, look, when we come into session in the one

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Speaker 7: hundred and nineteenth Congress next year, we've got some real challenges.

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Speaker 7: We've got two big I think fiscal red blinking lights

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Speaker 7: on the dashboard of the Congress. First, tax cuts and

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Speaker 7: jobs at rates and policies ARB are going to expire

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Speaker 7: during the year. And secondly, we're coming into yet in

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Speaker 7: other Congress with a two trillion dollar annualized deficit forecast.

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Speaker 7: So Congress has hard work. And Jason Smith, who's our

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Speaker 7: Ways and Means Committee chair, has got the point on

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Speaker 7: how do we preserve growth in this environment and how

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Speaker 7: do we set rates that reflect the growth that we need,

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Speaker 7: the faster economic growth and productivity that we want, fairness

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Speaker 7: for small businesses, but recognize that we're confronting this big deficit.

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Speaker 1: Do you think that it's appropriate for the Federal Reserve

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Speaker 1: to lower rates to make the deficit more affordable in

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Speaker 1: sort of a policy shift, even if that means that

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Speaker 1: inflation runs a little bit hotter.

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Speaker 7: I don't think that's the Fed's job. I think the

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Speaker 7: Fed's job is price stability. I don't think the Fed's

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Speaker 7: job is to do that. It has in the past

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Speaker 7: since nineteen thirteen. We've had the Fed and the Treasury

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Speaker 7: work in cahoots to lower borrowing costs during World War Two,

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Speaker 7: for example. But I think in a modern context, the

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Speaker 7: Fed's principal mission is price developed.

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Speaker 2: We know you've got places to be one of those places.

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Speaker 2: This morning is over at Bancleys of the Global Financial

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Speaker 2: Services Conference walks through what should be something the regulatory

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Speaker 2: agenda in the next term for the next four years,

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Speaker 2: maybe headed up by sat Donald Trump in a White

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Speaker 2: House and maybe you at the head of Financial Service Committee.

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Speaker 7: Yeah, well, I think we want to have access to

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Speaker 7: capital is the number one issue. We want a very

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Speaker 7: successful continuation of our capital market sister, raising capital through

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Speaker 7: the capital markets. But also we want a banking system

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Speaker 7: that has affordable credit and accessible credit. And part of

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Speaker 7: that is over the last decade or so, since the

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Speaker 7: financial crisis, we just have added on more regulatory costs

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Speaker 7: in both the portfolio commercial banking sector and in the

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Speaker 7: capital market sector that I don't believe improve safety and

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Speaker 7: sellness and are a detriment to more competition in accessing capital.

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Speaker 7: I think that's the principal mission.

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Speaker 2: We've got a lot to talk about. I know you've

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Speaker 2: got to run, but it's good to see us here

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Speaker 2: in New York City. Thank you very much. Thank you

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Speaker 2: friend Shill there the Congressman from Arkansas. On the regulatory

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Speaker 2: agenda and the push on the deficits. This is the

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Speaker 2: Bloomberg Surveillance podcast, bringing you the best in markets economics,

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00:23:31,000 --> 00:23:33,960
Speaker 2: antient Politics. You can watch the show live on Bloomberg

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00:23:34,000 --> 00:23:37,159
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