WEBVTT - The Fed, ETFs, Inflation, and Obesity Drugs (Podcast) 0:00:00.840 --> 0:00:04.000 Welcome to the Bloomberg Markets Podcast. I'm Paul Sweeney, alongside 0:00:04.040 --> 0:00:05.240 my co host Matt Miller. 0:00:05.640 --> 0:00:09.600 Every business day we bring you interviews from CEOs, market pros, 0:00:09.720 --> 0:00:13.600 and Bloomberg experts, along with essential market moving news. 0:00:14.160 --> 0:00:17.279 Find the Bloomberg Markets Podcast on Apple Podcasts or wherever 0:00:17.360 --> 0:00:20.520 you listen to podcasts, and at Bloomberg dot com slash podcast. 0:00:21.200 --> 0:00:23.480 There are certain sites you just never thought you'd see. 0:00:23.560 --> 0:00:24.120 Jess again. 0:00:24.280 --> 0:00:27.200 You kind of the pandemic change the world in so 0:00:27.280 --> 0:00:30.520 many different ways, and one of the ways has just 0:00:30.600 --> 0:00:34.440 been this whole work from home phenomena. And so many 0:00:34.479 --> 0:00:38.320 people have been so successful working from home that productivity 0:00:38.440 --> 0:00:40.159 is as good or better than it ever was. 0:00:40.280 --> 0:00:42.919 I know how bullish you are though about in office. 0:00:43.080 --> 0:00:44.800 No, I think it's I think this whole work from 0:00:44.800 --> 0:00:46.720 home things a scam, but it is the way of 0:00:46.760 --> 0:00:48.320 the world that I have to adapt. 0:00:48.479 --> 0:00:53.400 And Mike's listening. I'm coming back after exactly all right. 0:00:53.440 --> 0:00:55.959 Vinceignerella joins us here. He is our one of our 0:00:56.000 --> 0:00:58.960 go to voices on the market. Seed joints us here 0:00:58.960 --> 0:01:02.400 on O Bloomberg Interactive Studio and Vince, we've got the FED. 0:01:02.240 --> 0:01:03.200 Coming today here. 0:01:04.080 --> 0:01:06.520 What are you hearing in the marketplace about you know, 0:01:06.560 --> 0:01:09.760 what the market expects and kind of where we go 0:01:09.800 --> 0:01:10.199 from here. 0:01:11.040 --> 0:01:13.720 The market is looking for a skip, we don't really 0:01:13.720 --> 0:01:15.679 call it a pause, is a skip because the July 0:01:15.800 --> 0:01:19.120 meeting is still on the table. I said, July rate 0:01:19.200 --> 0:01:22.640 hikes still on the table. There's a hawkish bent or 0:01:22.640 --> 0:01:24.720 a hawkish lean is what we're expecting in the statements. 0:01:25.200 --> 0:01:27.080 But a few of the guys I talked to, and 0:01:27.120 --> 0:01:31.280 I think their rights are perhaps looking for a little 0:01:31.319 --> 0:01:34.120 bit more hawkish than I think the market's going to expect. 0:01:34.319 --> 0:01:37.080 I think, you know, for their credibility purposes, and that's 0:01:37.120 --> 0:01:40.200 been a huge thing for Powell to try to regain 0:01:40.240 --> 0:01:45.720 the credibility they lost with the transient inflation story. That 0:01:46.760 --> 0:01:49.480 even with the skip, he really needs to lay the 0:01:49.520 --> 0:01:52.600 hammer down and say, essentially, core inflation is not getting 0:01:52.640 --> 0:01:55.640 down to the two percent goal anywhere near as quickly 0:01:55.680 --> 0:01:56.360 as they'd like it to. 0:01:56.920 --> 0:01:59.400 So we have the statement at two pm, then we 0:01:59.440 --> 0:02:02.240 get the economic projections and the dot plots before we 0:02:02.320 --> 0:02:04.720 hear from the man himself, j palettes to thirty what 0:02:04.760 --> 0:02:06.480 are you looking for in the dot plots? 0:02:06.480 --> 0:02:09.320 In particular, to be perfectly honest, with you. I hate 0:02:09.360 --> 0:02:10.040 the dot plots. 0:02:11.600 --> 0:02:12.400 Dots. 0:02:12.400 --> 0:02:14.959 They are the biggest joke I have ever seen. 0:02:15.200 --> 0:02:18.480 Well, they also get altered, so obviously changed. 0:02:18.280 --> 0:02:20.959 Sotquently I was, I was out of lunch with a 0:02:21.120 --> 0:02:24.560 bullet and he basically said, why are you guys pricing 0:02:24.600 --> 0:02:26.800 this in? And I said, it's because of your. 0:02:26.680 --> 0:02:27.600 Bloody dot plots. 0:02:27.639 --> 0:02:30.120 They're telling us where it's going. And he goes, oh, 0:02:30.200 --> 0:02:33.280 don't see, that's just those are just estimates. They change 0:02:33.320 --> 0:02:36.079 all the time, and so you know, people do look 0:02:36.120 --> 0:02:38.800 at them. I guess you have to take them seriously personally, 0:02:38.919 --> 0:02:39.240 I don't. 0:02:40.160 --> 0:02:43.720 Bullard is a non voting member, but such an influential voice, 0:02:43.880 --> 0:02:45.799 and he had said in the last couple of weeks 0:02:45.840 --> 0:02:48.600 how he was expecting there to be at least two 0:02:48.800 --> 0:02:51.079 more even if they are two more great hikes, even 0:02:51.080 --> 0:02:52.600 if there was a pause at this point. Do you 0:02:52.639 --> 0:02:55.120 think that's likely with maybe just giving some of the 0:02:55.160 --> 0:02:58.040 inflation data obviously yesterday CPI coming cool with an expect. 0:02:58.000 --> 0:02:59.919 I hope not to more. Actually I hope not even 0:03:00.080 --> 0:03:02.600 one more. And you're you're absolutely right. He isn't an 0:03:02.639 --> 0:03:05.960 influential voice, but he is a non member, and I 0:03:06.000 --> 0:03:08.480 think from what I'm hearing from the voting members so far. 0:03:09.639 --> 0:03:11.680 Perhaps the most interesting thing I should say about what 0:03:11.760 --> 0:03:17.280 this decision we should see later is any dissensions. I 0:03:17.440 --> 0:03:20.120 have a full expectation that this isn't going to be 0:03:20.600 --> 0:03:23.240 something to oh, that there's going to be some dissenters 0:03:23.280 --> 0:03:26.640 in there, and those dissenters will be people who basically 0:03:26.680 --> 0:03:29.400 wanted a rate hike. There are a couple in there. 0:03:29.280 --> 0:03:32.680 So Oxford Economics actually had some great data that they 0:03:32.800 --> 0:03:35.760 crunch that a FED governor hasn't dissented since two thousand 0:03:35.800 --> 0:03:38.120 and five, so most more likely it would be a president. 0:03:38.120 --> 0:03:40.920 So they were looking at either Neil Kashkari Lori Logan 0:03:41.000 --> 0:03:43.360 as a couple of them. Members's interesting, Yeah. 0:03:43.080 --> 0:03:44.560 All right, So what are they when you talk to 0:03:44.560 --> 0:03:48.640 the traders out there, Vincent? Are they figuring price cuts 0:03:49.040 --> 0:03:51.000 later this year or this is twenty four event? 0:03:51.040 --> 0:03:53.160 Do you think I think they're liking him later this year? 0:03:53.160 --> 0:03:55.280 I don't think they're going to get them again. Going 0:03:55.280 --> 0:03:57.960 back to the Powell credibility issue, I think he needs 0:03:58.000 --> 0:04:02.160 to at least totally line keep the markets on their 0:04:02.200 --> 0:04:05.280 toes that you know, inflation would have to do something 0:04:05.400 --> 0:04:08.960 drastic moving lower before we would see any cuts this year, 0:04:09.080 --> 0:04:11.600 or if we would see a recession, It'd be really 0:04:11.640 --> 0:04:14.520 hard to believe a FED would keep rates higher for longer. 0:04:14.760 --> 0:04:16.599 If we were in some sort of a recession, it'd 0:04:16.640 --> 0:04:18.520 have to they'd have to bow to it. But I 0:04:18.560 --> 0:04:20.880 think it would be a very, very small and gradual 0:04:20.960 --> 0:04:23.640 move because I think he'd be worried more of anything 0:04:23.800 --> 0:04:29.280 for a repeat of stagflation, and so he's going to 0:04:29.360 --> 0:04:31.080 be on the tough side if he comes out in 0:04:31.160 --> 0:04:34.960 any way saying the word pause today, you're probably gonna 0:04:34.960 --> 0:04:37.159 see one of the most explosive rallies you've seen in 0:04:37.200 --> 0:04:37.760 a long time. 0:04:39.360 --> 0:04:43.400 So even if the dots suggest in twenty twenty four that, 0:04:44.120 --> 0:04:45.679 like we had seen in the past, that there should 0:04:45.720 --> 0:04:47.960 be some cuts there, it's still tricky, right, just given 0:04:48.000 --> 0:04:49.760 what you were saying, with the backdrop of how much 0:04:49.800 --> 0:04:50.840 these things can flip flow. 0:04:51.040 --> 0:04:54.440 Yeah, And I think it's more the analysts and strategists 0:04:54.440 --> 0:04:56.640 who are looking for cuts and traders looking for cuts 0:04:56.720 --> 0:04:59.960 rather than the FED officials. So I think the dot plot, 0:05:00.040 --> 0:05:02.279 if anything, is going to go against what's being priced 0:05:02.360 --> 0:05:06.200 into the swap market right now. But again, it's such 0:05:06.480 --> 0:05:09.760 it's such a waffly kind of changing environment with the 0:05:09.800 --> 0:05:12.479 dot plots that you know it could come together at 0:05:12.520 --> 0:05:12.960 any time. 0:05:14.160 --> 0:05:15.839 Do you still feel like or does a market still 0:05:15.839 --> 0:05:19.599 feel like vince that this FED is behind the curve 0:05:20.040 --> 0:05:23.080 in terms of just dealing with inflation, and it just 0:05:23.160 --> 0:05:24.920 kind of the where the market is. 0:05:25.520 --> 0:05:27.200 I mean behind the curve in the sense that they're 0:05:27.240 --> 0:05:28.359 too aggressive. 0:05:28.600 --> 0:05:30.840 Yeah, I mean that they were too late coming into 0:05:30.880 --> 0:05:32.599 it dealing with it they were, or maybe they were 0:05:32.640 --> 0:05:35.240 too late tapering, they were too late tightening, they were 0:05:35.240 --> 0:05:35.680 too late. 0:05:35.800 --> 0:05:39.479 And now kind of I think the way the market's 0:05:39.480 --> 0:05:41.320 looking at it, the way I would look at it is, 0:05:41.440 --> 0:05:46.400 you know, realistically, and this isn't a political statement, the 0:05:47.040 --> 0:05:49.560 reason why we have inflation is because of fiscal policy. 0:05:50.160 --> 0:05:55.320 Monetary policy is not very good at fixing fixed fiscal policy. 0:05:55.520 --> 0:05:59.440 I won't say errors, but abundance. We say, So, what's 0:05:59.520 --> 0:06:02.880 really neat at this time is some pullback on the 0:06:02.920 --> 0:06:05.960 fiscal front, which most likely not going to see and 0:06:06.000 --> 0:06:07.680 so the FED has to try to fix it with 0:06:07.720 --> 0:06:10.320 what tools they have, but they're they're not very effective 0:06:10.320 --> 0:06:11.320 against fiscal policy. 0:06:11.560 --> 0:06:15.240 You add a really interesting column that was on the 0:06:15.320 --> 0:06:18.960 terminal recently about how US consumer appears to be in trouble, 0:06:19.000 --> 0:06:21.760 but good news for bond bulls. Tell us more about that. 0:06:22.600 --> 0:06:25.280 You know, you're always hearing this about the consumers doing well, 0:06:25.440 --> 0:06:27.440 and it's definitely something going on in the real estate 0:06:27.480 --> 0:06:30.120 market for sure, especially in the Northeast, but in general, 0:06:31.160 --> 0:06:36.480 all of the savings that were gained from a pandemic 0:06:37.960 --> 0:06:43.160 fiscal policy are gone. Disposable income is dropping, and you're 0:06:43.160 --> 0:06:47.200 seeing revolving credits sore, and all of that speaks to 0:06:47.279 --> 0:06:52.240 a consumer that's now borrowing to spend, and there's an 0:06:52.360 --> 0:06:55.200 endgame to that. Where it is I wish I knew, 0:06:55.640 --> 0:06:57.680 but there's always an endgame to that. There's only so 0:06:57.800 --> 0:06:59.560 much they can borrow. And if you see the FED 0:06:59.600 --> 0:07:04.920 start to raise requirements on banks for loan portfolios, you're 0:07:04.920 --> 0:07:06.520 going to see the banks pull back on that credit. 0:07:06.560 --> 0:07:09.040 And when the banks pull back on credit, clearly you're 0:07:09.040 --> 0:07:11.200 going to see some impact on spending. And I just 0:07:11.200 --> 0:07:13.360 think the consumer is getting a little bit more tapped 0:07:13.400 --> 0:07:17.040 out than perhaps some of the optimistic people think, and 0:07:17.080 --> 0:07:20.280 that probably falls into where the recession potentially comes from. 0:07:20.320 --> 0:07:21.920 Where are some of those red flags and some of 0:07:21.960 --> 0:07:23.960 the loans. When it comes to the credit, you were 0:07:24.000 --> 0:07:24.600 talking about. 0:07:25.360 --> 0:07:26.720 One of the things that I would look at is 0:07:26.760 --> 0:07:29.400 the credit card companies. So we've seen very good earnings, 0:07:29.480 --> 0:07:31.960 very good profits coming from the likes of MasterCard, Visa 0:07:32.040 --> 0:07:35.200 an American Express. When that turns, I think then you're 0:07:35.200 --> 0:07:38.840 really looking at where consumers are getting in trouble, whether 0:07:38.880 --> 0:07:43.200 it be through default rates or simply just not spending, 0:07:43.240 --> 0:07:45.600 and therefore the earnings of those companies just don't show up. 0:07:46.600 --> 0:07:47.240 Unemployment. 0:07:48.200 --> 0:07:49.960 Where do you think that kind of goes over the 0:07:50.000 --> 0:07:51.400 next six to twelve months. Are we going to get 0:07:51.440 --> 0:07:52.840 to like a four percent number. 0:07:53.360 --> 0:07:54.640 I don't know where we're going to get to an 0:07:54.680 --> 0:07:56.360 in exact rate, but I'll tell you there's a trick 0:07:56.400 --> 0:07:58.840 to this employment and jobs number that I think which 0:07:58.880 --> 0:08:01.520 the FED is missing is the Joel's number. 0:08:01.520 --> 0:08:02.120 In particular. 0:08:02.440 --> 0:08:05.000 So during the pandemic, what you've saw where a lot 0:08:05.000 --> 0:08:10.240 of companies buying ads on Indeed, et cetera, those websites 0:08:10.480 --> 0:08:12.480 for job postings, and they were posting a lot more 0:08:12.560 --> 0:08:16.000 jobs that they really needed in anticipation of potentially losing 0:08:16.000 --> 0:08:19.600 staff because of the pandemic. Those are annual contracts, and 0:08:19.600 --> 0:08:22.400 those contracts are rolling off, so they're not likely to 0:08:22.440 --> 0:08:25.760 be buying the same size of ads that they did 0:08:25.760 --> 0:08:27.520 in the past, and they'll probably be just a little 0:08:27.560 --> 0:08:30.280 bit easier on posting. So I think the job posting 0:08:30.320 --> 0:08:32.360 is going to go down, the Joel state is going 0:08:32.400 --> 0:08:34.240 to go down, and with that will get a little 0:08:34.240 --> 0:08:37.000 bit more realistic employment number because when you buy these 0:08:37.040 --> 0:08:40.720 contracts to post jobs, they're not per job, they're just 0:08:40.840 --> 0:08:43.319 per year, and so you can post as many as 0:08:43.320 --> 0:08:45.560 you want and over post and that makes it look 0:08:45.640 --> 0:08:47.840 like there's a lot more I think it makes it 0:08:47.840 --> 0:08:49.480 look like there's a lot more job openings that they 0:08:49.520 --> 0:08:50.000 really are. 0:08:50.400 --> 0:08:52.000 Okay, Yeah, that's really interesting. 0:08:52.080 --> 0:08:54.000 Yeah, that's interesting because the Jolts data is something and 0:08:54.040 --> 0:08:56.160 it usually ran in between four and six million and 0:08:56.760 --> 0:08:58.880 still up around ten me and it makes you think about, geez, 0:08:59.240 --> 0:09:02.120 that's a tightly Hey, Vince, don't be a stranger. 0:09:02.600 --> 0:09:02.720 Vin. 0:09:02.800 --> 0:09:05.760 Soon you mound his way back to the Bloomberg Interactor 0:09:05.800 --> 0:09:06.760 Broker studio and. 0:09:06.720 --> 0:09:09.960 He will find his way out exactly. 0:09:10.559 --> 0:09:12.840 Little FaceTime doesn't hurt anybody. 0:09:14.080 --> 0:09:17.479 You're listening to the team Ken's our live program Bloomberg 0:09:17.520 --> 0:09:19.839 Markets weekdays at ten am Eastern. 0:09:19.600 --> 0:09:22.640 On Bloomberg dot Com, the iHeartRadio. 0:09:21.920 --> 0:09:24.680 App, and the Bloomberg Business App or listen on demand 0:09:24.720 --> 0:09:26.319 wherever you get your podcasts. 0:09:28.400 --> 0:09:30.360 Just met in Paul Sweeney here in our Bloomberg Interactor 0:09:30.400 --> 0:09:34.120 Broker's studio. We want to get to the story, the update, 0:09:34.160 --> 0:09:37.560 the latest reporting on former President Donald Trump and his 0:09:37.760 --> 0:09:39.760 legal challenges, and of course there's no one better to 0:09:39.800 --> 0:09:42.520 do that with than Tim O'Brien. Tim is a senior 0:09:42.559 --> 0:09:46.200 executive editor for Bloomberg Opinion, and Tim is the author 0:09:46.240 --> 0:09:49.080 of the book Trump Nation, The Art of Being the 0:09:49.160 --> 0:09:52.760 Donald in two thousand and five, the Definitive Biography of 0:09:52.840 --> 0:09:55.440 Donald Trump. So there's no one that knows this story 0:09:55.480 --> 0:09:57.000 in this individual better than Tim. 0:09:57.160 --> 0:09:58.959 Tim, thanks so much for joining us. We know you're 0:09:59.000 --> 0:10:00.520 traveling here, but I'd. 0:10:00.320 --> 0:10:03.120 Love to just get your perspective on We've had so 0:10:03.200 --> 0:10:07.320 many legal issues with this president before and during and 0:10:07.360 --> 0:10:12.280 after now his presidency. How important? How significant is this? 0:10:13.360 --> 0:10:14.640 Are these federal charges here? 0:10:18.160 --> 0:10:21.240 Well, Paul, I think they're extremely significant because it's a 0:10:21.320 --> 0:10:26.880 clarifying moment. I think that there's been this myth around 0:10:27.559 --> 0:10:30.800 former President Trump that he can't really be touched by 0:10:30.800 --> 0:10:33.520 the law, that it's target holds him accountable. But the 0:10:33.559 --> 0:10:38.960 reality is throughout his entire career before going into the 0:10:38.960 --> 0:10:42.840 White entering the White House, he's never had major federal 0:10:42.880 --> 0:10:47.920 investigations surrounding him, and now he does. And there's some 0:10:48.080 --> 0:10:52.640 very robust state investigations that are also targeting him. But 0:10:52.720 --> 0:10:56.840 as it pertains to this specific case, it is one 0:10:56.840 --> 0:10:59.320 of the I think things that are very very difficult 0:10:59.360 --> 0:11:01.280 for him to hint and with is the fact pattern. 0:11:01.720 --> 0:11:05.000 This is not a complex narrative to explain to a journey. 0:11:05.280 --> 0:11:08.880 He took documents allegedly that he was not entitled to take, 0:11:09.480 --> 0:11:12.400 and he obstructed justice when the federal government came looking 0:11:12.400 --> 0:11:16.120 for them, and his own video cameras that mar A 0:11:16.200 --> 0:11:20.000 Lago recorded this. The testimony that the federal government put 0:11:20.040 --> 0:11:23.520 in the indictment comes from Trump's own staff and from 0:11:23.600 --> 0:11:27.360 his own lawyers. So it's a very tough case and 0:11:28.760 --> 0:11:31.560 I think it's consequential, and I think that he I 0:11:31.559 --> 0:11:33.720 don't think he's prepared for it. I don't think he 0:11:33.800 --> 0:11:38.760 has the legal talent surrounding him to adequately defend him 0:11:38.800 --> 0:11:41.760 right now against the case like this, So there could 0:11:41.760 --> 0:11:43.040 be a rough ride to have for him. 0:11:43.480 --> 0:11:46.320 Tim set the scene for us after yesterday when Trump 0:11:46.559 --> 0:11:49.440 lefts a courtroom what do we need to know from 0:11:49.440 --> 0:11:50.360 this moving forward? 0:11:53.400 --> 0:11:56.080 Well, yesterday was pretty undramatic. I think, you know, from 0:11:56.120 --> 0:11:59.760 all accounts, it was pretty in and out. He sat silently, 0:12:01.880 --> 0:12:05.800 the federal government and Jack Smith didn't make much of 0:12:05.840 --> 0:12:09.240 a show of anything, and they process things and he 0:12:09.320 --> 0:12:12.400 left the courtroom. I think going forward, there's one more 0:12:12.440 --> 0:12:17.360 process hearing with a second magistrate judge, and then the 0:12:17.400 --> 0:12:21.440 trial begins with Judge Cannon, and I think there's you know, 0:12:21.520 --> 0:12:24.760 she's a Trump appoint There's been questions about whether or 0:12:24.800 --> 0:12:27.880 not she is going to run up their process in 0:12:27.920 --> 0:12:31.240 her courtroom, given the fact that she owes her job 0:12:31.280 --> 0:12:36.200 to the president. She also gets to decide even if 0:12:36.200 --> 0:12:38.640 a jury finds him guilty, she gets to decide how 0:12:38.679 --> 0:12:42.960 severe his sentence will be. I think his maximum exposure 0:12:43.800 --> 0:12:47.280 on almost all of the counts is ten years, and 0:12:47.320 --> 0:12:52.480 there's one count that it has a maximum possible prison 0:12:52.520 --> 0:12:56.559 sentence for twenty years. I doubt we'll see any sentencing, 0:12:56.720 --> 0:13:01.160 even if it wasn't a possibly friendly judge go to 0:13:01.200 --> 0:13:05.120 the full amount here. But that that dynamic, I think 0:13:05.800 --> 0:13:09.120 how the government presents its evidence, how the jury interprets it, 0:13:09.480 --> 0:13:11.600 and then how the judge decide to sentence him. Is 0:13:12.160 --> 0:13:14.760 are the next steps? And all he can do is 0:13:14.840 --> 0:13:17.760 try to mount an effective defense, which has already done 0:13:17.760 --> 0:13:20.839 a little bit publicly saying that he was entitled to 0:13:20.920 --> 0:13:22.520 roose documents and he did nothing wrong. 0:13:23.600 --> 0:13:26.920 So, tim based upon kind of your knowledge and your reporting, 0:13:27.320 --> 0:13:31.240 is this trial h is it going to happen or 0:13:31.280 --> 0:13:32.760 is there going to be a plea agreement? And if 0:13:32.760 --> 0:13:36.160 it does happen, how quickly? There's a lot of moving 0:13:36.200 --> 0:13:36.720 parts here. 0:13:39.160 --> 0:13:41.480 Well, you know, if there's gonna be a pre agreement, 0:13:41.720 --> 0:13:43.960 it's you're going to have to agree to a settlement 0:13:44.480 --> 0:13:50.640 that satisfies the federal government. And previous cases the government takes, 0:13:50.679 --> 0:13:53.760 you know, these kinds of cases seriously. He is alleged 0:13:54.040 --> 0:13:59.880 taken documents, exposed the vulnerabilities the US military had nuclear 0:14:00.080 --> 0:14:03.880 she puts in some of them, and, by the government's account, 0:14:04.120 --> 0:14:09.120 compromise national security. We have a voteload of previous cases 0:14:09.120 --> 0:14:11.880 in which the charges events of here, and the defendants 0:14:11.920 --> 0:14:14.040 have gone to jail for the equivement for doing that. 0:14:14.240 --> 0:14:17.680 So if they try to do a plea agreement, it 0:14:17.679 --> 0:14:19.600 will be very interesting to see what the components of 0:14:19.640 --> 0:14:22.760 that are. And Trump at this point might be wise 0:14:22.840 --> 0:14:25.560 to try to do that, but I just don't know. 0:14:26.720 --> 0:14:29.120 I think the second piece what you'll see here is 0:14:29.160 --> 0:14:31.440 that he will take his argument to the streets, and 0:14:31.520 --> 0:14:35.200 I'm concerned about the possibility of violence because he is 0:14:35.240 --> 0:14:37.760 not someone who goes gently into that good night. He 0:14:37.880 --> 0:14:40.480 is not going to if he has found guilty. I 0:14:40.520 --> 0:14:42.400 think he was going to be going to encourage his 0:14:42.480 --> 0:14:45.760 supporters to be heard. And that's another dynamic that I 0:14:45.760 --> 0:14:47.480 think we'll have to watch very carefully. 0:14:47.800 --> 0:14:49.440 How long could the trial. 0:14:49.240 --> 0:14:49.760 Last for. 0:14:52.920 --> 0:14:55.160 Well, Jack Smith thinks that he wants a speedy trial, 0:14:55.400 --> 0:14:58.120 and I think they're going to try to move this 0:14:58.240 --> 0:15:00.200 along as quickly as they can. I don't think they're 0:15:00.200 --> 0:15:03.320 going to try to spend months and months presenting evidence. 0:15:04.200 --> 0:15:07.160 The federal government, particularly the Justice Department, did not by 0:15:07.240 --> 0:15:13.440 clinging cases during presidential election primary season goes in the 0:15:13.520 --> 0:15:16.800 full force in January. That's new territory too. I don't 0:15:16.840 --> 0:15:20.840 think they're going to want to trying him come next spring, 0:15:20.960 --> 0:15:22.480 so I think you're going to see this move along 0:15:22.520 --> 0:15:25.520 pretty quickly. The other thing to remember is there's another 0:15:25.560 --> 0:15:29.840 investigation of the Justice Department involved January sixth, and the 0:15:29.880 --> 0:15:34.480 possibility that Trump incided and insurrection and tried to intrigue 0:15:35.040 --> 0:15:39.760 with the electoral count procedures. And that's a trickier case, 0:15:39.800 --> 0:15:42.080 I think for them to bring the course. I think 0:15:42.120 --> 0:15:44.600 from a strategic standpoint, they were smart to go first 0:15:44.600 --> 0:15:47.720 with them are allowed o case, but they still have 0:15:47.840 --> 0:15:50.120 that one left to unfurrow, and you have to see 0:15:50.120 --> 0:15:51.160 what happens with that one too. 0:15:51.840 --> 0:15:55.520 Hey, Tim, let's fast forward a little bit to the election. 0:15:56.320 --> 0:15:58.520 Any sense of how this might play during the election. 0:16:01.320 --> 0:16:03.800 Well, I mean, this just throws such a wild card up. 0:16:03.880 --> 0:16:07.000 So here we know that after Alvin Bragg in Manhattan 0:16:07.040 --> 0:16:12.120 BA and guided Trump for financial for financial fraud in 0:16:12.160 --> 0:16:15.880 an electoral fraud in New York. It helped Trump with 0:16:16.040 --> 0:16:20.360 his base, and I think more generally with Republican voters 0:16:20.400 --> 0:16:22.520 who aren't part of his base, which are the ones 0:16:22.600 --> 0:16:27.200 he needs to amount of successful national election. I think 0:16:27.200 --> 0:16:29.840 he will probably be any other Republican in the primary 0:16:29.840 --> 0:16:32.120 season right now. I don't think he can win a 0:16:32.200 --> 0:16:36.240 general election unless he gets moderate and moderate Republicans in 0:16:36.800 --> 0:16:41.920 an independent And that first case, you know, people felt 0:16:41.920 --> 0:16:44.840 that drag was being unfair to the former president, and 0:16:44.920 --> 0:16:47.640 the polls indicated that that gave him an electoral base. 0:16:48.120 --> 0:16:51.960 It will be interesting to see how Republican voters respond 0:16:52.000 --> 0:16:54.400 to this case. I think this is a much more muscular, 0:16:55.040 --> 0:16:59.160 clear cut base. I think what you know, the risure 0:16:59.240 --> 0:17:02.760 occurred is much more damning yep. And there's not a 0:17:02.760 --> 0:17:06.560 lot of nebulous nips around it. So we'll have to 0:17:06.600 --> 0:17:08.040 see how that plays outs too. 0:17:08.240 --> 0:17:09.919 All right, Tim, thank you so much for joining us. 0:17:09.920 --> 0:17:14.000 Tim O'Brien, he's a senior executive editor for Bloomberg Opinion. 0:17:14.320 --> 0:17:17.520 He's also the author of Trump Nation, The Art of 0:17:17.720 --> 0:17:20.560 Being the Donald. He published that in two thousand and five, 0:17:21.320 --> 0:17:23.600 held as a definitive biography of Donald Trump. 0:17:23.680 --> 0:17:24.800 So Tim has a. 0:17:24.720 --> 0:17:28.840 Real good insight into Donald Trump the person as well 0:17:28.880 --> 0:17:30.960 as the politician as well. 0:17:31.280 --> 0:17:34.360 You're listening to the tape. Can's our live program Bloomberg 0:17:34.480 --> 0:17:38.080 Markets weekdays at ten am Eastern on Bloomberg Radio, the 0:17:38.119 --> 0:17:40.080 tune in app, Bloomberg dot Com, and. 0:17:40.040 --> 0:17:41.359 The Bloomberg Business App. 0:17:41.400 --> 0:17:44.199 You can also listen live on Amazon Alexa from our 0:17:44.240 --> 0:17:49.320 flagship New York station, Just say Alexa play Bloomberg eleven thirty. 0:17:50.480 --> 0:17:53.440 All right, let's get right to our next guest in studio, 0:17:53.520 --> 0:17:56.520 which she gets an extra start joining Gegos joins Is. 0:17:56.600 --> 0:17:59.520 She's a co founder of Bond Blocks. She co found 0:17:59.520 --> 0:18:01.960 a bond blog in twenty twenty one, and as the 0:18:02.200 --> 0:18:07.000 name would imply, it's an ETF firm that focuses on bonds. Jinna, 0:18:07.040 --> 0:18:09.679 thanks so much for joining us. So, I mean the 0:18:09.720 --> 0:18:12.119 reality join is I can go with a two year treasure, 0:18:12.119 --> 0:18:15.200 we can get four point sixty two percent. I mean 0:18:15.560 --> 0:18:18.240 there's actually income and fixed income these days, right, Yeah. 0:18:18.160 --> 0:18:20.600 We like to say the income's back in fixed income, 0:18:20.760 --> 0:18:23.240 and we really are encouraging investors to take a look 0:18:23.280 --> 0:18:26.640 and think about repositioning in their portfolios now because of everything. 0:18:26.359 --> 0:18:27.439 That's happened over the last year. 0:18:27.480 --> 0:18:30.840 Of most areas in fixed income, yields have doubled since 0:18:30.880 --> 0:18:31.600 twenty twenty two. 0:18:32.080 --> 0:18:34.680 It's interesting because you see so much money plowing into 0:18:34.840 --> 0:18:36.880 money market funds and other corners of the market when 0:18:36.880 --> 0:18:40.560 obviously you can yield five percent or more at this point. 0:18:40.760 --> 0:18:43.400 What do you think is the dynamic changing there between say, 0:18:43.520 --> 0:18:46.080 post the housing crisis, where you couldn't yield that amount 0:18:46.119 --> 0:18:49.119 whereas now. Is it not just a defensive posturing. Is 0:18:49.160 --> 0:18:51.600 it also just because of what investors can yield at 0:18:51.600 --> 0:18:52.040 this point? 0:18:52.160 --> 0:18:52.400 Yeah? 0:18:52.440 --> 0:18:54.960 So we have to remember the fundamentals of fixed income, 0:18:55.000 --> 0:18:57.639 and that the total return of fixed income includes the 0:18:57.760 --> 0:19:00.600 yield on the income side of your coupon pay plus 0:19:00.640 --> 0:19:04.040 the return of the asset itself. And with these yields, 0:19:04.119 --> 0:19:07.880 like they're really providing a lot of cushion for volatility 0:19:07.920 --> 0:19:10.600 that's still in the market is still we view is 0:19:10.640 --> 0:19:12.639 going to persist through the rest of the year, and 0:19:12.680 --> 0:19:14.680 so you don't want to forget that. You know, it's 0:19:14.720 --> 0:19:17.560 not just about being defensive. It's about taking action in 0:19:17.600 --> 0:19:20.919 your portfolio to get great total return relative to other 0:19:20.960 --> 0:19:23.320 asset classes right now, and fixing them can provide that 0:19:23.440 --> 0:19:26.479 to you with a lot a lot less volatility relative 0:19:26.480 --> 0:19:27.320 to other asset. 0:19:27.080 --> 0:19:30.120 Types, even equity. Well, this bid for cash is. 0:19:30.080 --> 0:19:32.600 So interesting because you look at money market funds right now. 0:19:32.680 --> 0:19:35.800 Mutual funds so not quite as cool as ETFs, but 0:19:35.840 --> 0:19:38.400 still there's five point five trillion in them. 0:19:38.840 --> 0:19:40.920 Money is still growing. At the same time, you. 0:19:40.840 --> 0:19:43.840 Also have sort of the spiritual opposite going on, where 0:19:43.840 --> 0:19:46.800 people are chasing tech, they're chasing AI and those growth 0:19:46.840 --> 0:19:47.320 of your names. 0:19:47.359 --> 0:19:47.919 So it's been. 0:19:47.800 --> 0:19:52.159 Interesting to see those two opposite approaches build up at 0:19:52.160 --> 0:19:52.760