WEBVTT - US Aims to Throttle Iran's Economy; Bessent Flags Bigger Debt Buyback Potential

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<v Speaker 1>Bloomberg Audio Studios, Podcasts, Radio News.

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<v Speaker 2>Good morning, I'm Nathan Hager and I'm Alexis Christophers.

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<v Speaker 3>Here are the stories we're following today now.

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<v Speaker 2>Like s as we begin with the latest developments in

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<v Speaker 2>the Middle East, Iran is dismissing US threats of economic

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<v Speaker 2>pain and isolation. Treasury Secretary Scott Besson says the Trump

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<v Speaker 2>administration will give details of an initiative on Monday that

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<v Speaker 2>President Trump describes as an economic d day. We get

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<v Speaker 2>the very latest from Bloomberg News director Will Kennedy.

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<v Speaker 4>Aren't that many added things the US can do? There

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<v Speaker 4>are sanctions that have been in place for many, many years.

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<v Speaker 4>There's this blockade of oil tankers, which is of course

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<v Speaker 4>having an impact. Iranian oil exports are very close to zero.

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<v Speaker 4>It would really take an effort to persuade other countries

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<v Speaker 4>like China not to trade with Iran to make a

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<v Speaker 4>big further difference. One presumes putting secondary sanctions on China

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<v Speaker 4>would be a very big step for lots of reasons,

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<v Speaker 4>given the broader context on the China US relationship, not

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<v Speaker 4>least because Donald Trump is about to have a meeting

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<v Speaker 4>with shishimping.

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<v Speaker 2>And Bloombergswill Kennedy says China will provide the biggest test

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<v Speaker 2>of Washington's determination to follow through. Beijing is the main

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<v Speaker 2>buyer of Iranian oil and.

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<v Speaker 3>Nathan There may be new tensions in the Asia Pacific.

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<v Speaker 3>The US, Japan, and South Korea held a three way

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<v Speaker 3>call to coordinate their response after North Korea fired a

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<v Speaker 3>barrage of short range ballistic missiles yesterday. The volley came

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<v Speaker 3>after President Trump stunned South Korea by abruptly canceling decades

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<v Speaker 3>old joint military exercises, and the North rejected the president's

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<v Speaker 3>bid to resume dialogue with leader Kim Jong un. North

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<v Speaker 3>Korea says the two leaders may have an excellent relationship,

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<v Speaker 3>but America's hostile policies haven't changed still, South Korea's president

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<v Speaker 3>says he supports President Trump's decision to curtail the drills

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<v Speaker 3>and reopen diplomacy.

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<v Speaker 2>Well lexis new trade deadlines coming up for the the

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<v Speaker 2>US and Canada. The two sides have till midnight to

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<v Speaker 2>reach a broader trade deal after President Trump announced a

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<v Speaker 2>tentative agreement to avert fifty percent tariffs on billions of

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<v Speaker 2>dollars in Canadian goods sources tell Bloomberg the current deal

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<v Speaker 2>with lower tariffs on certain Canadian steel and aluminum exports

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<v Speaker 2>to twenty five percent and Canadian car duties would fall

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<v Speaker 2>to fifteen percent. Chris Jiah Freeland is a former Canadian

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<v Speaker 2>Deputy Prime Minister. She says both sides need a better outcome.

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<v Speaker 5>I think that is a bad outcome for Canada to

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<v Speaker 5>have permanent tariffs on our steel, aluminum, cars and carport parts.

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<v Speaker 5>Really harmful for those sectors.

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<v Speaker 6>But I think it's a bad outcome for the United

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<v Speaker 6>States as well.

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<v Speaker 5>It's really important for people to recognize that you can

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<v Speaker 5>lose by winning.

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<v Speaker 2>Former Canadian Deputy Prime Minister Christia Freeland, and you can

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<v Speaker 2>catch more of her remarks on Bloomberg Wall Street Week

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<v Speaker 2>tonight at six eastern on Bloomberg Radio, Bloomberg Television, and

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<v Speaker 2>the Bloomberg Business app.

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<v Speaker 3>Well, we have a winner in this week's special runoff

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<v Speaker 3>in California to serve the rest of former Congressman Eric

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<v Speaker 3>Swalwell's term. With ninety five percent of votes counted, the

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<v Speaker 3>Associated Press Projects State Senator Aisha Wahab will beat fellow

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<v Speaker 3>Democrat Bay Area Rapid Transit Board president Melissa Hernandez fifty

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<v Speaker 3>three to.

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<v Speaker 7>Forty seven percent.

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<v Speaker 3>Wahab will become the first Afghan American to serve in Congress,

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<v Speaker 3>and her campaign was backed by the Congressional Progressive Caucus.

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<v Speaker 3>The result comes as Swalwell remains under investigation for sexual

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<v Speaker 3>assault allegations. Federal agencized electronic devices from the former congressman

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<v Speaker 3>at San Francisco Airport over the weekend and later searched

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<v Speaker 3>his home in Washington, d C.

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<v Speaker 7>Alexis.

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<v Speaker 2>The bid term elections are now less than eighty days away,

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<v Speaker 2>and Republicans have a huge war chest sitting on the sidelines.

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<v Speaker 2>The latest federal filings show President Trump's super pac Maga Inc.

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<v Speaker 2>Has a nearly four hundred four million dollar cash pile.

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<v Speaker 2>The committee received another three million dollars in donations last month,

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<v Speaker 2>including from private prison operator Geogroup and sugar producer Florida Crystals.

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<v Speaker 2>At the same time, Maga Inc. Spent just one hundred

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<v Speaker 2>and thirty two thousand dollars in July, mostly on operating costs.

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<v Speaker 2>President Trump has said he plans to use Maga Inc.

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<v Speaker 2>To support Republicans. So far, though he hasn't signed off

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<v Speaker 2>on a plan.

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<v Speaker 3>And Treasury Secretary Scott Besson says he's prepared to ramp

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<v Speaker 3>up buybacks of costly US government debt. That's despite the

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<v Speaker 3>short lived impact so far on long term borrowing costs.

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<v Speaker 3>Besson also hinted at a new fiscal plan to address

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<v Speaker 3>the highest treasury yields in decades.

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<v Speaker 8>Once the market understands that we are focusing on fiscal

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<v Speaker 8>consolidation and that we are trying to bring the market

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<v Speaker 8>back into equilibrium in a thinly traded market, I think

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<v Speaker 8>you know, I'm confident that bonds will continue declining.

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<v Speaker 3>Treasury Secretary Scott Besson added the expanded buyback could be

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<v Speaker 3>more than the four billion dollars currently planned for next month.

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<v Speaker 2>There's a warning this morning from former New York Fed

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<v Speaker 2>Bank President Bill Dudley, the current Bloomberg opinion columnist, says

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<v Speaker 2>the US equity market is in bubble territory.

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<v Speaker 9>Look at the railroads and the internet, telecom boom. All

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<v Speaker 9>those things did great things for the comedy. So two

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<v Speaker 9>things can be true at the same time. The technological

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<v Speaker 9>innovation can be really transformative, but at the same time

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<v Speaker 9>you can have an investment boom and bus And in fact,

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<v Speaker 9>if you look at history, it tells you that that's

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<v Speaker 9>usually the case. So the question here is really it's

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<v Speaker 9>just really not whether it's going to be a turn

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<v Speaker 9>from a boom to a bus. It's really a question

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<v Speaker 9>of timing and magnitude.

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<v Speaker 2>That's former New York Fed President Bill Dudley. He says

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<v Speaker 2>the stock market bubble will likely burst before the end

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<v Speaker 2>of twenty twenty seven. You can hear his full remarks

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<v Speaker 2>on the Bloomberg Video Hub at Bloomberg dot com and

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<v Speaker 2>the Bloomberg Business app.

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<v Speaker 3>And Nathan as warnings grow of an artificial intelligence fueled

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<v Speaker 3>stock market bubble. Word this morning that Anthropic is preparing

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<v Speaker 3>for a potentially record breaking IPO. Sources say the Claw

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<v Speaker 3>developer expects to match or beat the record seventy five

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<v Speaker 3>billion dollars raised in SpaceX is listing. Mandeep saying, is

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<v Speaker 3>Bloomberg Intelligence is a global head of tech research.

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<v Speaker 7>This kind of.

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<v Speaker 10>Growth through r it is phenomenal at the scale Andthropic

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<v Speaker 10>is at And that's where when you compare to SpaceX,

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<v Speaker 10>which kind of pod with about eighteen to nineteen billion

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<v Speaker 10>dollar revenue run rate growth rate, much slower than entropics,

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<v Speaker 10>and still manage to get close to that two trillion

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<v Speaker 10>dollar mark. So from that perspective, clearly Entropic with its

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<v Speaker 10>growth rate, should be at least over where SpaceX traded initially.

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<v Speaker 3>Bloomberg Intelligence is mandip sings as Anthropic may file publicly

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<v Speaker 3>for IPO by the end of this month.

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<v Speaker 1>Well.

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<v Speaker 2>Meanwhile, Lexis broadcoms and talks with lenders to raise more

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<v Speaker 2>than sixty billion dollars in debt for an AI chip

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<v Speaker 2>financing deal that would benefit Anthropic and other companies. The

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<v Speaker 2>potential deal would help those firms access chips and other

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<v Speaker 2>key AI infrastructure. Ryan Gould covers the chip sector for Bloomberg.

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<v Speaker 11>This would be among the largest that we've seen of

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<v Speaker 11>this type of deal. I want to just throw us

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<v Speaker 11>back a little bit to June when we saw all

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<v Speaker 11>Common announced that partnership with black Zone and Apollo, where

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<v Speaker 11>essentially they were looking to strike an agreements provide sort

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<v Speaker 11>of twenty kigawats of compute to Glow for AI deployment.

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<v Speaker 11>I mean, I think you could probably see this as

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<v Speaker 11>some kind of extension of that agreement. This would essentially

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<v Speaker 11>see Blackstone and Apollo participate again per our sourcing and reporting.

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<v Speaker 2>Bloomberg's Ryan Gould says Broadcom forecast back in March it

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<v Speaker 2>would have AI chip sales topping one hundred billion dollars

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<v Speaker 2>next year, and.

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<v Speaker 3>Bloomberg News has learned in Nvidia is in early discussions

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<v Speaker 3>with the Korean AI chip designer Rebellions about possible collaborations.

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<v Speaker 3>Sources say the talks include a technical partnership and investment,

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<v Speaker 3>or perhaps even an acquisition. Founded during the pandemic in

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<v Speaker 3>twenty twenty, Rebellions is among a group of semiconductor startups

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<v Speaker 3>designing and deploying their own chips to rival market leader

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<v Speaker 3>in video.

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<v Speaker 2>And South Korean chip giant Samsung Electronics plans to return

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<v Speaker 2>as much as seventy nine billion dollars to its shareholders. Alexis,

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<v Speaker 2>joining rival s k Heinez and handing investors a chunk

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<v Speaker 2>of the windfall generated by the AI rush. The world's

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<v Speaker 2>biggest memory maker is set to hold a board meeting

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<v Speaker 2>to discuss shareholder returns.

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<v Speaker 3>Five h nine on Wall Street Time Now for a

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<v Speaker 3>look at some of the other stories making news in

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<v Speaker 3>New York and around the world. For that, we're joined

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<v Speaker 3>by a Bloomberg's Michael Barr. Good morning, Michael, Good morning.

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<v Speaker 12>Alexis authority say a woman who had been plotting to

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<v Speaker 12>bomb the New York State Capitol building in Albany, has

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<v Speaker 12>been arrested in an FBI sting. Jessica Bowie allegedly believed

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<v Speaker 12>laws were being passed that were affront to Islam. She

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<v Speaker 12>is now facing a federal terrorism charge. Authority say Bowie

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<v Speaker 12>had been under surveillance for more than a month as

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<v Speaker 12>she communicated with at least one confidential informant posing as

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<v Speaker 12>isis First Assistant US Attorney John Sarconne.

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<v Speaker 8>The charge against Bowie carries a satutory maximum prison term

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<v Speaker 8>of twenty years, a fine of up to two hundred

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<v Speaker 8>and fifty thousand dollars, and a lifetime term of supervised release.

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<v Speaker 12>New York Governor Kathy Okele.

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<v Speaker 2>Political violence has no place in our state, and I've

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<v Speaker 2>leave this suspect.

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<v Speaker 6>She prosecuted to the fullest extent of.

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<v Speaker 12>The law, according to a criminal complaint. After her arrest,

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<v Speaker 12>Bowie told FBI agents that she expected to go to prison,

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<v Speaker 12>saying there's no helping meet. You guys know enough. In Massachusetts,

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<v Speaker 12>Representative Seth Moulton and Senator Ed Markey held their final

0:09:14.840 --> 0:09:18.720
<v Speaker 12>Democratic Senate primary debate. At one point, the argument for

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<v Speaker 12>generational change came up on artificial intelligence.

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<v Speaker 8>I don't know what companies of my iPad might be using.

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<v Speaker 13>If you don't even know what you're using on your

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<v Speaker 13>phone your iPad, like this is why we need a

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<v Speaker 13>new generation of leaders.

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<v Speaker 12>Audio courtesy of WCVB. Both candidates brought up affordability issues

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<v Speaker 12>while linking domestic prices to the war in Iran. The

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<v Speaker 12>primary is set for September first in New York. Two

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<v Speaker 12>tornadoes touchdown in Queens and on Long Island last evening.

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<v Speaker 12>Officials say both started as water spouts and then made landfall.

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<v Speaker 12>No one was heard. Democratic Congresswoman Joyce Beatty accused the

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<v Speaker 12>Trump administration of violating a federal court order barring the

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<v Speaker 12>Kennedy Center's board from renaming the performing arts venue for

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<v Speaker 12>President Donald Trump. Attorneys for Beattie said the representative means

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<v Speaker 12>it was a new, breathtaking act of defiance of Congress

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<v Speaker 12>and of this court. Global news twenty four hours a

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<v Speaker 12>day and whenever you want it. We're the Bloomberg News.

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<v Speaker 12>Now now Michael Barr, and this is Bloomberg Alexis.

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<v Speaker 2>Thanks Michael, time now for our Bloomberg Sports update, and

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<v Speaker 2>for that we bring in Dan Schwartzman Baseball Scoreboard.

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<v Speaker 14>The Yankees finish off a sweep of the Orioles six

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<v Speaker 14>to one. The Rays fall to the Blue Jays five

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<v Speaker 14>to one. Well, the Braves one hit the White Sox

0:10:34.800 --> 0:10:37.680
<v Speaker 14>in a two nothing win. Elsewhere, Jacob de Grom becomes

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<v Speaker 14>the second fastest pitcher in baseball history to reach two

0:10:40.480 --> 0:10:43.120
<v Speaker 14>thousand strikeouts as a Rangers. Ace does it in the

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<v Speaker 14>fewest innings pitched outside of Chris sale to Gram and

0:10:46.040 --> 0:10:49.760
<v Speaker 14>Texas at the Nationals to nothing. NFL preseason Week two

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<v Speaker 14>began Thursday night as a Raiders gone past the Texans

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<v Speaker 14>twenty two to twenty, but number one overall draft pick

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<v Speaker 14>Heisman Trophy winner Fernando Mendoza struggled, completing just eight of

0:10:58.960 --> 0:11:01.640
<v Speaker 14>fifteen passes for eight eighty six yards and an interception,

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<v Speaker 14>while the forty nine Ers dominated the Chargers forty one

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<v Speaker 14>to seventeen.

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<v Speaker 7>That's your Bloomberg Sports update.

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<v Speaker 2>Stay with us more from Bloomberg Daybreak coming up after this.

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<v Speaker 1>Coast to coast on Bloomberg Radio, nationwide on Sirius XM,

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<v Speaker 1>and around the world on Bloomberg dot Com and the

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<v Speaker 1>Bloomberg Business app.

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<v Speaker 6>This is Bloomberg daybreak.

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<v Speaker 7>Good morning, I'm Nathan Hager.

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<v Speaker 2>Treasury Secretary Scott Besson says he is prepared to go

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<v Speaker 2>even further to bring down yields on long day to debt.

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<v Speaker 2>He's teasing a new fiscal initiative after this week's announcement

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<v Speaker 2>from the Treasury of expanded bond buybacks. Besson says, any

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<v Speaker 2>initial moves in the market ahead of all this are

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<v Speaker 2>just noise.

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<v Speaker 8>Our announcement is for economics action, and I think that

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<v Speaker 8>the economic action will mean that oil prices will come

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<v Speaker 8>down sooner.

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<v Speaker 2>That was Treasury Secretary Scott Besson at the White House

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<v Speaker 2>and for more. We're joined by Bloomberg News FX and

0:12:02.200 --> 0:12:04.319
<v Speaker 2>rates reporter Alice Gledhill.

0:12:04.640 --> 0:12:06.600
<v Speaker 7>Good to have you back with us. Alice.

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<v Speaker 2>Of course we saw the big purchase after the initial announcement,

0:12:11.480 --> 0:12:17.560
<v Speaker 2>but the reversal, of course on yesterday's session should Beston

0:12:17.679 --> 0:12:20.960
<v Speaker 2>be concerned that this is more than just noise.

0:12:21.080 --> 0:12:25.400
<v Speaker 13>Good morning, Good morning, Thanks for having me back. Yeah.

0:12:25.440 --> 0:12:27.560
<v Speaker 13>I mean, best might say he's not concerned, but I

0:12:27.559 --> 0:12:29.640
<v Speaker 13>think he is concerned, and I think he probably should

0:12:29.640 --> 0:12:32.560
<v Speaker 13>be concerned. I think, you know, coming into this job,

0:12:32.720 --> 0:12:36.840
<v Speaker 13>he had a KPI Key Performance Indicator and that was

0:12:36.880 --> 0:12:40.240
<v Speaker 13>get yields down sustainably, and it just doesn't seem like

0:12:40.280 --> 0:12:41.880
<v Speaker 13>he's succeeding at that so far.

0:12:42.800 --> 0:12:44.040
<v Speaker 6>You know, the problem is well known.

0:12:44.160 --> 0:12:47.600
<v Speaker 13>The US has too much debt, it's growing, It has

0:12:47.640 --> 0:12:53.000
<v Speaker 13>this almost two trillion dollar budget deficit, and crucially, you know,

0:12:53.040 --> 0:12:55.080
<v Speaker 13>the debt is growing at a time when interest rates

0:12:55.280 --> 0:12:57.840
<v Speaker 13>a high, So borrowing costs a high. Your debt service

0:12:57.880 --> 0:12:59.760
<v Speaker 13>and costs a high, and that's money that you can't

0:12:59.760 --> 0:13:03.120
<v Speaker 13>spend on other things. And of course, you know, high

0:13:03.200 --> 0:13:05.600
<v Speaker 13>US Treasury eels also push up things like interest bills

0:13:05.600 --> 0:13:08.760
<v Speaker 13>and mortgages other loans, and that's unpalatable I think from

0:13:08.800 --> 0:13:13.400
<v Speaker 13>a political perspective, certainly ahead of the midterms. So yeah,

0:13:13.440 --> 0:13:15.520
<v Speaker 13>I think there's a wides bread viewer market that the

0:13:15.640 --> 0:13:19.120
<v Speaker 13>US can't keep on, can't sort of keep going on

0:13:19.240 --> 0:13:23.840
<v Speaker 13>like this. It's not sustainable, you know, and does it

0:13:23.880 --> 0:13:26.200
<v Speaker 13>all end with some sort of crisis? And I think

0:13:26.280 --> 0:13:28.840
<v Speaker 13>that's what the US administration is trying to avoid.

0:13:29.320 --> 0:13:34.760
<v Speaker 2>So what kind of fiscal initiative could the Treasury Secretary

0:13:34.800 --> 0:13:38.240
<v Speaker 2>announce here they could really take a bite out of

0:13:38.440 --> 0:13:42.280
<v Speaker 2>these rising dead costs. We heard the secretary talk about

0:13:42.640 --> 0:13:45.920
<v Speaker 2>going after fraud I mean, would that be enough.

0:13:46.520 --> 0:13:49.680
<v Speaker 13>Yeah, I think that's the key question for investors, certainly

0:13:49.720 --> 0:13:52.120
<v Speaker 13>heading into the weekend. I mean, obviously we had Best

0:13:52.160 --> 0:13:55.000
<v Speaker 13>and comeback on screens yesterday and talk a little bit

0:13:55.040 --> 0:14:00.440
<v Speaker 13>more about the measures that he's announced this week. So

0:14:00.480 --> 0:14:02.720
<v Speaker 13>he sort of talked up the size of these potential

0:14:02.760 --> 0:14:05.160
<v Speaker 13>buybacks and the longer dated bonds that had a very

0:14:05.200 --> 0:14:07.520
<v Speaker 13>small impact on yields, but it was pretty fleeting, to

0:14:07.520 --> 0:14:10.560
<v Speaker 13>be honest, and then he sort of flags this upcoming

0:14:10.600 --> 0:14:14.079
<v Speaker 13>fiscal initiative. But yeah, I mean details are pretty unclear.

0:14:14.160 --> 0:14:19.840
<v Speaker 13>I think, yeah, you mentioned the potential sort of fraud

0:14:19.960 --> 0:14:23.320
<v Speaker 13>task force there, but I mean, I'm not sure the

0:14:23.360 --> 0:14:26.800
<v Speaker 13>market is really buying this all that much at the moment.

0:14:26.920 --> 0:14:28.840
<v Speaker 13>I think these are kind of seen as sort of

0:14:28.840 --> 0:14:33.080
<v Speaker 13>stopgap measures and the issue, you know, the things we

0:14:33.080 --> 0:14:34.920
<v Speaker 13>were just talking about, the enormous deficite and so on,

0:14:35.160 --> 0:14:37.360
<v Speaker 13>that's the big problem and that's what needs to be tackled.

0:14:37.400 --> 0:14:39.800
<v Speaker 13>And I'm not quite sure that sort of Best in

0:14:39.840 --> 0:14:42.040
<v Speaker 13>the kind of dancing around these issues this week, with

0:14:42.080 --> 0:14:45.480
<v Speaker 13>these sort of kind of piecemeal ideals ideas, is really

0:14:45.560 --> 0:14:48.440
<v Speaker 13>sort of convincing anyone in the market to that point.

0:14:48.480 --> 0:14:51.320
<v Speaker 2>I mean, we heard strategistic JP Morgan Chase come right

0:14:51.360 --> 0:14:55.080
<v Speaker 2>out and say that expanded bond buybacks could test the

0:14:55.160 --> 0:14:59.040
<v Speaker 2>Treasury's credibility. I mean, what's the risk that this could

0:14:59.160 --> 0:15:00.880
<v Speaker 2>all back for you're on the department.

0:15:01.760 --> 0:15:03.200
<v Speaker 6>I think that absolutely is the risk.

0:15:03.400 --> 0:15:06.000
<v Speaker 13>Yeah, I agree with JP Morgan, and I think you know,

0:15:06.040 --> 0:15:07.840
<v Speaker 13>if you come out and say, you know, we've got

0:15:07.840 --> 0:15:10.800
<v Speaker 13>this tool, it's you know, it's going to help liquidity

0:15:11.440 --> 0:15:13.040
<v Speaker 13>in a part of the market where I think some

0:15:13.040 --> 0:15:17.240
<v Speaker 13>people doubt there is actually a liquidity problem. I think, yeah,

0:15:17.920 --> 0:15:19.960
<v Speaker 13>it just feels like the treasure is maybe flailing a

0:15:20.000 --> 0:15:22.000
<v Speaker 13>little bit here and that you know, I think that's

0:15:22.080 --> 0:15:24.720
<v Speaker 13>damaging to its credibility, and that's sort of why you

0:15:24.760 --> 0:15:28.840
<v Speaker 13>saw the decline in yields earlier this week reverse pretty quickly.

0:15:29.880 --> 0:15:32.640
<v Speaker 13>I had an interesting conversation actually with one big investor

0:15:32.680 --> 0:15:36.480
<v Speaker 13>here in Europe yesterday who was saying, there's not much

0:15:36.560 --> 0:15:39.800
<v Speaker 13>that Beston can do kind of right now, Like what

0:15:39.920 --> 0:15:42.440
<v Speaker 13>the long end really needs is a hike actually from

0:15:42.480 --> 0:15:44.080
<v Speaker 13>the Fed, and that will sort of sure up its

0:15:44.520 --> 0:15:48.400
<v Speaker 13>inflation inflation fighting credentials, and that's going to help sort

0:15:48.400 --> 0:15:50.360
<v Speaker 13>of restore confidence at the long end of the curve.

0:15:50.520 --> 0:15:52.560
<v Speaker 6>So yeah, an interesting response from him.

0:15:52.640 --> 0:15:54.640
<v Speaker 13>He was, you know, he said, besn't kind of need

0:15:54.720 --> 0:15:57.200
<v Speaker 13>sort of signal kind of so much, but you know

0:15:57.280 --> 0:15:59.240
<v Speaker 13>that the FED needs to be involved here as well.

0:15:59.480 --> 0:16:02.120
<v Speaker 2>An interesting point considering we just tarned from San Francisco

0:16:02.160 --> 0:16:04.920
<v Speaker 2>FED President Mary Daily on Bloomberg just yesterday saying that

0:16:04.960 --> 0:16:06.800
<v Speaker 2>she's more focused on the short end of the curve

0:16:06.800 --> 0:16:08.680
<v Speaker 2>as opposed to the long end.

0:16:08.760 --> 0:16:12.240
<v Speaker 7>But I mean, we've also seen throughout all this.

0:16:12.920 --> 0:16:17.520
<v Speaker 2>AI companies coming out with massive debt offerings as well.

0:16:17.640 --> 0:16:19.160
<v Speaker 2>I mean, is that the kind of thing that can

0:16:19.280 --> 0:16:21.960
<v Speaker 2>have an impact on what we're seeing in the government

0:16:22.000 --> 0:16:22.560
<v Speaker 2>bond space.

0:16:23.480 --> 0:16:24.120
<v Speaker 6>Yeah, for sure.

0:16:24.200 --> 0:16:26.840
<v Speaker 13>I mean I think it's very hard to quantify the

0:16:27.360 --> 0:16:30.160
<v Speaker 13>extent to which that mega issuance in the AI in

0:16:30.280 --> 0:16:35.480
<v Speaker 13>tech space particularly is impacting government bonds. But you know,

0:16:35.520 --> 0:16:38.120
<v Speaker 13>Betten himself sort of mentioned this as being a factor

0:16:38.160 --> 0:16:41.880
<v Speaker 13>in the rise in US BONN yields in his comments yesterday.

0:16:42.160 --> 0:16:44.520
<v Speaker 13>I think, I guess the point is that you have

0:16:45.280 --> 0:16:47.920
<v Speaker 13>a lot of this corporate issuance is long dated, a

0:16:47.920 --> 0:16:50.600
<v Speaker 13>lot of it is highly rated, so you got because

0:16:50.600 --> 0:16:52.160
<v Speaker 13>it's a credit, you got a bit more pick up

0:16:52.680 --> 0:16:56.320
<v Speaker 13>in yield over the comparable US treasury. So you know,

0:16:56.320 --> 0:16:58.200
<v Speaker 13>if you're an investor hunting for yield, a court like,

0:16:58.200 --> 0:17:00.920
<v Speaker 13>why wouldn't you buy that stuff? And of course, you know,

0:17:00.920 --> 0:17:03.880
<v Speaker 13>it's not just the US government that's issuing an enormous

0:17:03.960 --> 0:17:07.840
<v Speaker 13>amount of debt. It's governments everywhere, whether that's while certainly

0:17:07.840 --> 0:17:11.440
<v Speaker 13>in Europe, it's the UK, it's Germany, it's France, it's

0:17:11.480 --> 0:17:13.000
<v Speaker 13>you know, Japan has increasing issues.

0:17:13.080 --> 0:17:14.639
<v Speaker 6>So there's just more debt everywhere.

0:17:14.920 --> 0:17:18.119
<v Speaker 13>And I think that's another deep structural forces that's driving

0:17:18.160 --> 0:17:21.120
<v Speaker 13>up eels on treasuries and other sovereign debt everywhere.

0:17:21.520 --> 0:17:24.000
<v Speaker 2>Sort of last minute alice from the people that you're

0:17:24.040 --> 0:17:26.520
<v Speaker 2>speaking with, what are they telling you when it comes

0:17:26.520 --> 0:17:28.840
<v Speaker 2>to what they would like to hear from the Treasury

0:17:28.880 --> 0:17:31.480
<v Speaker 2>Department in terms of a credible move to bring these

0:17:31.520 --> 0:17:32.360
<v Speaker 2>borrowing costs down.

0:17:33.600 --> 0:17:35.480
<v Speaker 13>So I think it's it's kind of back to that

0:17:35.560 --> 0:17:39.960
<v Speaker 13>point about tackling the underlying issue on a sort of

0:17:40.000 --> 0:17:43.119
<v Speaker 13>serious fundamental level, and that's kind of I suppose a

0:17:43.720 --> 0:17:48.720
<v Speaker 13>significant fiscal program that starts to bring down that deficit significantly,

0:17:49.080 --> 0:17:51.240
<v Speaker 13>but I think from a political point of view that

0:17:51.560 --> 0:17:53.920
<v Speaker 13>you know, that's not easy, and I think that's why

0:17:53.920 --> 0:17:57.160
<v Speaker 13>the market is going to keep on testing the US administration.

0:17:57.240 --> 0:18:01.520
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