1 00:00:02,520 --> 00:00:13,760 Speaker 1: Bloomberg Audio Studios, podcasts, radio news. This is the Bloomberg 2 00:00:13,840 --> 00:00:17,920 Speaker 1: Surveillance Podcast. Catch us live weekdays at seven am Eastern 3 00:00:18,200 --> 00:00:22,000 Speaker 1: on Apple CarPlay or Android Auto with the Bloomberg Business app. 4 00:00:22,360 --> 00:00:25,680 Speaker 1: Listen on demand wherever you get your podcasts, or watch 5 00:00:25,760 --> 00:00:27,240 Speaker 1: us live on YouTube. 6 00:00:27,520 --> 00:00:32,519 Speaker 2: University Martin Feldstein the original support of Kenneth Rogoff, Benjamin 7 00:00:32,560 --> 00:00:36,720 Speaker 2: Friedman and others. And it devolves down to their freshman class, 8 00:00:36,760 --> 00:00:42,720 Speaker 2: which is legendary worldwide X ten economic ten. Recently, Greg 9 00:00:42,800 --> 00:00:46,240 Speaker 2: manq the force there and he gave the baton off 10 00:00:46,280 --> 00:00:50,120 Speaker 2: to Jason Furman in the recent years. Mister Furman has 11 00:00:50,200 --> 00:00:54,760 Speaker 2: public policy perspective, typically from a Democratic view, but I'd 12 00:00:54,840 --> 00:00:57,880 Speaker 2: call him on the edge of bipartisan. And he joins 13 00:00:57,960 --> 00:01:01,520 Speaker 2: us now from Harvard. Going to redo your essay, Jason. 14 00:01:01,560 --> 00:01:03,560 Speaker 2: It's a clinic in the New York Times here over 15 00:01:03,600 --> 00:01:06,319 Speaker 2: the weekend. I'm going to get right down to the 16 00:01:06,480 --> 00:01:11,120 Speaker 2: single argument here mister Trump has returned to again and 17 00:01:11,160 --> 00:01:16,399 Speaker 2: again is that other countries are taking advantage of the 18 00:01:16,560 --> 00:01:24,200 Speaker 2: United States. Is the Trump grievance deserved? Absolutely not. 19 00:01:24,760 --> 00:01:26,640 Speaker 3: I mean that essay I had in the New York 20 00:01:26,640 --> 00:01:29,200 Speaker 3: Times was just what I teach in my class to 21 00:01:29,240 --> 00:01:31,160 Speaker 3: my introduction, so it felt like it. 22 00:01:31,200 --> 00:01:31,959 Speaker 2: I felt like that. 23 00:01:32,200 --> 00:01:35,360 Speaker 3: Yeah, And it's the same lesson I got from Marty 24 00:01:35,400 --> 00:01:40,959 Speaker 3: Feldstein when I took the class decades ago. Trade deficits 25 00:01:41,000 --> 00:01:45,600 Speaker 3: are not inherently bad. Imports are a wonderful thing. Trade 26 00:01:45,640 --> 00:01:50,280 Speaker 3: deficits don't happen because of differential tariffs in different countries, 27 00:01:50,920 --> 00:01:55,440 Speaker 3: and changing tariffs doesn't sell trade deficits. Every step of 28 00:01:55,520 --> 00:01:59,960 Speaker 3: the reasoning underlying today's announcement is just completely at all 29 00:02:00,560 --> 00:02:03,040 Speaker 3: with the most basic economics. 30 00:02:02,480 --> 00:02:06,200 Speaker 2: Within this, Professor Furman, his professor Hassett is trying to 31 00:02:06,240 --> 00:02:09,880 Speaker 2: help out the Trump administration. Kevin Hascid with a PhD 32 00:02:10,000 --> 00:02:13,800 Speaker 2: from a Philadelphia school named Pennsylvania. And there's others best 33 00:02:13,800 --> 00:02:17,280 Speaker 2: and the Treasury Secretary. From where you sit, Jason Furman, 34 00:02:17,639 --> 00:02:19,840 Speaker 2: how alone is President Trump? 35 00:02:21,360 --> 00:02:23,680 Speaker 3: You know, I don't know exactly what's going on inside 36 00:02:23,680 --> 00:02:26,440 Speaker 3: the White House, but I know you have the cent 37 00:02:26,520 --> 00:02:29,639 Speaker 3: a year ago basically saying tariffs are a bad thing, 38 00:02:29,720 --> 00:02:32,560 Speaker 3: a loaded gun pointed at the head of the US economy. 39 00:02:33,200 --> 00:02:36,440 Speaker 3: I know Kevin has historically been a free trader. I 40 00:02:36,480 --> 00:02:40,160 Speaker 3: hope they're trying to pull things in a less bad direction. 41 00:02:40,840 --> 00:02:44,160 Speaker 3: But you know, when your opening gambit is twenty percent 42 00:02:44,240 --> 00:02:47,000 Speaker 3: across the board tariffs, you can move in a less 43 00:02:47,040 --> 00:02:50,400 Speaker 3: bad direction and still have things be pretty. 44 00:02:50,080 --> 00:02:53,480 Speaker 4: Bad, Jason, as I understand it, as I understand the 45 00:02:53,520 --> 00:02:57,359 Speaker 4: administration's perspective, they simply cite the fact that the US 46 00:02:57,440 --> 00:03:01,680 Speaker 4: pays a weighted average tariff of two to three times 47 00:03:01,720 --> 00:03:03,959 Speaker 4: the rate that we charge most of the rest of 48 00:03:04,000 --> 00:03:06,359 Speaker 4: the world, and they want that to be leveled up. 49 00:03:07,240 --> 00:03:10,440 Speaker 4: Is that kind of their argument, and if so, that 50 00:03:10,600 --> 00:03:15,959 Speaker 4: seems fair level playing field? Is that a sound economic argument? 51 00:03:17,120 --> 00:03:19,400 Speaker 3: First of all, those other countries are often hurting themselves 52 00:03:19,400 --> 00:03:21,760 Speaker 3: with their teriffs. You look at these Latin American countries 53 00:03:21,760 --> 00:03:24,520 Speaker 3: that have had high tariffs. That wasn't a smart strategy 54 00:03:24,520 --> 00:03:26,639 Speaker 3: to take advantage of the United States. That was a 55 00:03:26,720 --> 00:03:31,440 Speaker 3: dumb strategy to stunt their economic growth. But let's do 56 00:03:31,560 --> 00:03:34,080 Speaker 3: some of the numbers. Let's say you do want reciprocation. 57 00:03:34,639 --> 00:03:37,440 Speaker 3: We have tariffs against most rich countries of around one 58 00:03:37,480 --> 00:03:40,760 Speaker 3: or two percent. Most rich countries have tariffs against US 59 00:03:40,920 --> 00:03:43,200 Speaker 3: of about one or two percent. So we don't need 60 00:03:43,360 --> 00:03:46,200 Speaker 3: any new tariffs against rich countries. Who don't need any 61 00:03:46,280 --> 00:03:48,839 Speaker 3: new tariffs against counta in Mexico. Then when it comes 62 00:03:48,880 --> 00:03:51,120 Speaker 3: to China and India, if we want to even them up, 63 00:03:51,360 --> 00:03:53,240 Speaker 3: we would need to raise ours by two or three 64 00:03:53,320 --> 00:03:58,640 Speaker 3: percentage points, not anything like the ten twenty that we're 65 00:03:58,680 --> 00:04:00,920 Speaker 3: hearing about in today's announcement. 66 00:04:01,680 --> 00:04:04,560 Speaker 4: All right, so that's the math. What are some of 67 00:04:04,560 --> 00:04:08,720 Speaker 4: the potential unintended consequences here? People will say two that 68 00:04:08,840 --> 00:04:12,240 Speaker 4: I can think of one as slower growth. Number two 69 00:04:12,320 --> 00:04:14,680 Speaker 4: is higher inflation. Are those valid? 70 00:04:16,279 --> 00:04:16,919 Speaker 2: Absolutely? 71 00:04:17,040 --> 00:04:21,680 Speaker 3: I think every Wall Street forecaster has downgraded their forecast 72 00:04:21,720 --> 00:04:25,200 Speaker 3: for growth and upgraded their forecast for inflation. The FED 73 00:04:25,279 --> 00:04:27,440 Speaker 3: did the same thing, although the FED wasn't one hundred 74 00:04:27,480 --> 00:04:30,640 Speaker 3: percent explicit about what drove their changes. It's hard to 75 00:04:30,680 --> 00:04:34,039 Speaker 3: imagine there was anything else that was going on there. 76 00:04:34,440 --> 00:04:36,400 Speaker 3: But to that list of two, I'd add a longer 77 00:04:36,480 --> 00:04:40,039 Speaker 3: term one, which is geopolitics. The United States is a 78 00:04:40,080 --> 00:04:43,320 Speaker 3: big important country. It is not infinitely big. It is 79 00:04:43,400 --> 00:04:47,240 Speaker 3: not infinitely important. China is also a really, really big 80 00:04:47,279 --> 00:04:50,719 Speaker 3: player in the world. The only way we can confront 81 00:04:50,800 --> 00:04:54,280 Speaker 3: China is by doing it together with allies, and if 82 00:04:54,279 --> 00:04:57,479 Speaker 3: we alienate our allies. There's a lot more countries that 83 00:04:57,560 --> 00:05:00,200 Speaker 3: trade more with China than with the United States. We're 84 00:05:00,200 --> 00:05:03,920 Speaker 3: just going to push that further and help realign global 85 00:05:04,080 --> 00:05:10,000 Speaker 3: geopolitics away from the US alliance and towards a Chinese entent. 86 00:05:10,240 --> 00:05:14,520 Speaker 2: And your morning community this morning across Canada, across Mexico, 87 00:05:14,720 --> 00:05:18,120 Speaker 2: in America, Jason Furman with US of Harvard University, we 88 00:05:18,160 --> 00:05:21,320 Speaker 2: said good morning on Android auto Applecar played the new 89 00:05:21,360 --> 00:05:24,520 Speaker 2: Digital Experience, and of course to all of you on YouTube, 90 00:05:24,560 --> 00:05:27,960 Speaker 2: subscribe to Bloomberg Podcast, and I'll get out the Firman 91 00:05:28,040 --> 00:05:31,560 Speaker 2: New York Times essay here in a bit, Jason, I 92 00:05:31,640 --> 00:05:33,839 Speaker 2: want to go to the driver of this, and I 93 00:05:33,880 --> 00:05:36,479 Speaker 2: want to start with Lightheiser, who grew up in the 94 00:05:36,520 --> 00:05:40,919 Speaker 2: crucible of northeastern Ohio, where as a kid he saw 95 00:05:41,120 --> 00:05:46,920 Speaker 2: American steel industrial might disappear. And then we've got Navarro 96 00:05:47,440 --> 00:05:52,200 Speaker 2: of LA of Irvine with his own take here to 97 00:05:52,320 --> 00:05:55,560 Speaker 2: move us away from free trade. The heart of this 98 00:05:55,600 --> 00:05:59,120 Speaker 2: is the Matthew teach, which is a j curve in economics. 99 00:05:59,120 --> 00:06:01,800 Speaker 2: There's going to be short term pain, but out there, 100 00:06:01,800 --> 00:06:04,839 Speaker 2: I sound like a Linda Ronstadt song out there somewhere, 101 00:06:05,440 --> 00:06:09,000 Speaker 2: Jason Furman, there's going to be a better American trade policy. 102 00:06:09,480 --> 00:06:13,320 Speaker 2: What do they get wrong about the midterm and long 103 00:06:13,400 --> 00:06:16,960 Speaker 2: term benefit of what is clearly perceived to be short 104 00:06:17,080 --> 00:06:19,279 Speaker 2: term pain. Right. 105 00:06:19,360 --> 00:06:21,800 Speaker 3: I mean, the thing that a lot of people don't 106 00:06:21,880 --> 00:06:25,240 Speaker 3: understand is when you put a tariff on imports, you're 107 00:06:25,279 --> 00:06:28,560 Speaker 3: effectively putting a tariff on exports too. And that could 108 00:06:28,560 --> 00:06:32,000 Speaker 3: happen because other countries retaliate with their own tariffs. It 109 00:06:32,000 --> 00:06:36,320 Speaker 3: could happen because your tariffs lead to an exchange rate appreciation, 110 00:06:36,440 --> 00:06:40,000 Speaker 3: which make it harder for you to export. What do 111 00:06:40,080 --> 00:06:41,719 Speaker 3: we export in I'd state so well, A lot of 112 00:06:41,760 --> 00:06:45,440 Speaker 3: that is really terrific manufacturing that's made here in America 113 00:06:45,839 --> 00:06:48,839 Speaker 3: sold around the world, and we're going to have less 114 00:06:49,440 --> 00:06:52,120 Speaker 3: of all of that. I don't see this as a 115 00:06:52,160 --> 00:06:54,880 Speaker 3: pro manufacturing plan. You we're going to raise the cost 116 00:06:54,920 --> 00:06:56,560 Speaker 3: of inputs to me, Yeah. 117 00:06:56,560 --> 00:07:00,560 Speaker 2: Does Jason Furman have a strong dollar week dollar outcome 118 00:07:00,880 --> 00:07:03,680 Speaker 2: out of this? Let's go Robert Mundel right now, Jason 119 00:07:03,720 --> 00:07:05,000 Speaker 2: Furman with the dollar. 120 00:07:05,920 --> 00:07:09,279 Speaker 3: I'm with a strong dollar. But you know, we're going 121 00:07:09,320 --> 00:07:11,000 Speaker 3: to see what the announcement is today and how it 122 00:07:11,040 --> 00:07:14,240 Speaker 3: compares the expectations. Also depends a lot on the FED. 123 00:07:14,320 --> 00:07:16,400 Speaker 3: I think the FED is going to be and should be, 124 00:07:16,480 --> 00:07:19,800 Speaker 3: reluctant to cut rates when inflation if it goes above 125 00:07:19,840 --> 00:07:23,400 Speaker 3: three percent. Sure they can say their models say it's transitory, 126 00:07:23,720 --> 00:07:25,880 Speaker 3: but they're going to be pretty nervous and they should 127 00:07:25,960 --> 00:07:29,720 Speaker 3: be to act on that belief, especially with inflation expectations 128 00:07:29,720 --> 00:07:31,800 Speaker 3: so elevated more opeds. 129 00:07:32,000 --> 00:07:35,120 Speaker 2: There are people I know, Jason sending your OpEd to 130 00:07:35,160 --> 00:07:39,440 Speaker 2: their children saying you shut up and read it. Jason Furman, 131 00:07:39,520 --> 00:07:41,800 Speaker 2: thank you so much for Harvard this morning. 132 00:07:42,360 --> 00:07:46,280 Speaker 1: This is the Bloomberg Surveillance Podcast. Listen live each weekday 133 00:07:46,320 --> 00:07:49,600 Speaker 1: starting at seven am Eastern on Applecarplay and Android Auto 134 00:07:49,720 --> 00:07:52,680 Speaker 1: with the Bloomberg Business app. You can also listen live 135 00:07:52,760 --> 00:07:56,360 Speaker 1: on Amazon Alexa from our flagship New York station, Just 136 00:07:56,400 --> 00:07:58,880 Speaker 1: say Alexa Play Bloomberg eleven thirty. 137 00:07:59,080 --> 00:08:02,520 Speaker 2: It's giving us day after day. Is Henrietta Trees and 138 00:08:02,520 --> 00:08:06,840 Speaker 2: the politics of the moment. Henrietta. The marketing idea here 139 00:08:06,960 --> 00:08:11,560 Speaker 2: is liberation Day. Will Republicans be liberated today? 140 00:08:12,760 --> 00:08:15,800 Speaker 5: It's amazing. I'm actually about to send an email out 141 00:08:15,840 --> 00:08:19,680 Speaker 5: with a quote from Senator Hoven which is effectively saying, 142 00:08:20,400 --> 00:08:24,920 Speaker 5: let's hope we'll see there is an expectation or understanding 143 00:08:24,960 --> 00:08:28,280 Speaker 5: that free trade doesn't work. It's a novel position for 144 00:08:28,320 --> 00:08:31,880 Speaker 5: the Republican conference, and you know, we have one hundred 145 00:08:31,880 --> 00:08:34,640 Speaker 5: and fifty years worth of data on tariffs to suggest 146 00:08:34,679 --> 00:08:37,400 Speaker 5: they pretty clearly do not. As Jason Farman points out, 147 00:08:37,400 --> 00:08:40,000 Speaker 5: that countries with high tariffs shoot themselves in the foot 148 00:08:40,040 --> 00:08:42,680 Speaker 5: with high tariffs. So that is the course that the 149 00:08:42,679 --> 00:08:45,640 Speaker 5: president is determined to take. What we'll hear about later today. 150 00:08:46,640 --> 00:08:51,320 Speaker 4: Are you surprised that, Henriette, we haven't seen any really 151 00:08:51,559 --> 00:08:55,800 Speaker 4: strategic or coordinated kind of pushback along the lines of 152 00:08:56,040 --> 00:08:59,760 Speaker 4: Professor Furman from members of Congress just simply laying out 153 00:09:00,200 --> 00:09:02,880 Speaker 4: the simple economics here of how tarrifs worked. 154 00:09:03,920 --> 00:09:06,640 Speaker 5: I'm shocked. I feel like it should be so easy 155 00:09:06,679 --> 00:09:09,760 Speaker 5: to message around. You know, the easiest example is you've 156 00:09:09,760 --> 00:09:13,000 Speaker 5: had twenty five percent tariffs on aluminum. What is your 157 00:09:13,000 --> 00:09:15,600 Speaker 5: beer can made out of aluminum? You know, it should 158 00:09:15,600 --> 00:09:17,920 Speaker 5: be a really easy messaging point. All your back to 159 00:09:17,960 --> 00:09:23,079 Speaker 5: school items, your backpacks, umbrellas, rain boots, baseball gloves, all 160 00:09:23,120 --> 00:09:26,520 Speaker 5: of it. Tireff died at twenty percent already, if not 161 00:09:26,720 --> 00:09:28,760 Speaker 5: already in the Section three oh one tariffs that are 162 00:09:28,760 --> 00:09:31,400 Speaker 5: on at twenty five percent, So I think the messaging 163 00:09:31,400 --> 00:09:35,360 Speaker 5: should be much easier. I do think that what Trump 164 00:09:35,400 --> 00:09:37,760 Speaker 5: has done President Trump has done is he's split the 165 00:09:37,880 --> 00:09:42,960 Speaker 5: Democratic Party that necessarily wasn't pro free trade a couple 166 00:09:43,000 --> 00:09:45,960 Speaker 5: of years ago, and he's moved the Republicans into a 167 00:09:45,960 --> 00:09:49,679 Speaker 5: more progressive place or populous place where they maybe are 168 00:09:49,720 --> 00:09:52,480 Speaker 5: no longer free trade pro free trade either. And you've 169 00:09:52,960 --> 00:09:56,880 Speaker 5: kind of bifurcated all of DC, not along party lines, 170 00:09:56,920 --> 00:10:00,000 Speaker 5: but along sort of allegiances. And then you know, maybe 171 00:10:00,080 --> 00:10:04,439 Speaker 5: stale or outdated views from either parties left and right camps. 172 00:10:05,480 --> 00:10:08,760 Speaker 4: So what is the next How do you expect the Democrats, 173 00:10:08,800 --> 00:10:11,280 Speaker 4: if at all, and or the Republicans, if at all, 174 00:10:11,360 --> 00:10:13,360 Speaker 4: to respond to what we may hear, what we're going 175 00:10:13,400 --> 00:10:15,160 Speaker 4: to hear at four o'clock today, Will there be will 176 00:10:15,200 --> 00:10:17,559 Speaker 4: tomorrow will be a day of lots of sound bites 177 00:10:17,600 --> 00:10:18,760 Speaker 4: coming out of both parties. 178 00:10:19,679 --> 00:10:22,200 Speaker 5: I expect so. And in fact, we'll have a vote 179 00:10:22,240 --> 00:10:24,719 Speaker 5: that they'll be able to talk about later today. The 180 00:10:26,160 --> 00:10:29,480 Speaker 5: negative for President Trump on the AIPA tariff's worth regards 181 00:10:29,480 --> 00:10:32,640 Speaker 5: to Canada is that there is some congressional oversight here. 182 00:10:32,679 --> 00:10:35,440 Speaker 5: So the Senators have put a joint resolution on the 183 00:10:35,440 --> 00:10:38,880 Speaker 5: floor condemning the President's decision to label Canada our closest 184 00:10:38,920 --> 00:10:42,640 Speaker 5: ally as an international economic emergency that needs to be 185 00:10:42,679 --> 00:10:45,679 Speaker 5: retaliated against with tariffs. So they're going to put that 186 00:10:45,720 --> 00:10:48,440 Speaker 5: bill on the floor today. And I understand at least 187 00:10:48,480 --> 00:10:51,320 Speaker 5: four Senators and I know as many as at least 188 00:10:51,400 --> 00:10:54,240 Speaker 5: ten want to vote with the Democrats on this, and 189 00:10:54,280 --> 00:10:57,400 Speaker 5: that would include Rand Paul of Kentucky, Mitch McConnell of Kentucky. 190 00:10:57,600 --> 00:11:00,720 Speaker 5: We've seen, you know, bourbon from Kentucky and tariff see 191 00:11:00,760 --> 00:11:03,600 Speaker 5: talking point, and a couple of others who are going 192 00:11:03,600 --> 00:11:06,600 Speaker 5: to side with Democrats to pass this resolution later on. 193 00:11:06,720 --> 00:11:08,640 Speaker 5: The benefit for President Trump is that the House will 194 00:11:08,679 --> 00:11:12,040 Speaker 5: not take up this legislation impasset or that's his expectation, 195 00:11:12,240 --> 00:11:14,560 Speaker 5: and so it won't do anything, but it will give 196 00:11:14,600 --> 00:11:17,040 Speaker 5: Democrats at least an opportunity to get members on the record. 197 00:11:17,320 --> 00:11:20,679 Speaker 2: And now, folks a delicate question in case Senator Grassley's 198 00:11:20,720 --> 00:11:24,040 Speaker 2: watching this, and Senator Grassley's old enough to remember David Ricardo, 199 00:11:24,280 --> 00:11:26,840 Speaker 2: he was probably on the boat with Churchill and Roosevelt 200 00:11:27,040 --> 00:11:30,520 Speaker 2: at the Atlantic Charter, Henrietta. Tre's what we're going to 201 00:11:30,600 --> 00:11:34,560 Speaker 2: get here is some form of liberation announcement, and in 202 00:11:34,600 --> 00:11:37,839 Speaker 2: the announcement or as Paul mentioned one day, two days later, 203 00:11:38,360 --> 00:11:41,320 Speaker 2: we're going to get a battle out for American farmers 204 00:11:41,679 --> 00:11:45,320 Speaker 2: off of Canadian fertilizer and six other things you understand 205 00:11:45,400 --> 00:11:48,920 Speaker 2: that I don't get is the check from President Trump 206 00:11:48,960 --> 00:11:52,959 Speaker 2: to the farmers Republicans. Is it going to somebody eighty 207 00:11:53,040 --> 00:11:57,240 Speaker 2: seven miles west of Des Moines helping Senator Grassley or 208 00:11:57,280 --> 00:11:58,880 Speaker 2: is it going to corporate America. 209 00:12:00,600 --> 00:12:02,559 Speaker 5: It's going to be a combination of both. It's through 210 00:12:02,600 --> 00:12:06,240 Speaker 5: a very technical program at USDA. The benefit here is 211 00:12:06,240 --> 00:12:10,160 Speaker 5: that this is a well trodden road. The USDA Secretary 212 00:12:10,240 --> 00:12:13,520 Speaker 5: under Trump's first term deployed this exact same strategy three 213 00:12:13,559 --> 00:12:17,160 Speaker 5: times to whether the trade war with China. But the 214 00:12:17,240 --> 00:12:20,880 Speaker 5: real beneficiary here is Brazil. As you were talking about before, 215 00:12:20,960 --> 00:12:24,360 Speaker 5: they have new rose to hoe on soybeans and all 216 00:12:24,440 --> 00:12:27,760 Speaker 5: kinds of trade with China. Argentina's in the same boat, 217 00:12:27,960 --> 00:12:30,440 Speaker 5: and that's what farmers are going to lose permanently on 218 00:12:30,480 --> 00:12:32,360 Speaker 5: a go forward basis. So you can bail out the 219 00:12:32,400 --> 00:12:36,079 Speaker 5: farmers now, but you're losing market share and eventually that's 220 00:12:36,160 --> 00:12:38,120 Speaker 5: going to be something that the United States cannot bail 221 00:12:38,200 --> 00:12:38,840 Speaker 5: farmers out of. 222 00:12:39,679 --> 00:12:42,679 Speaker 4: Henriette, what did you make of yesterday's political action? The 223 00:12:43,000 --> 00:12:46,839 Speaker 4: two races down in Florida and the Supreme Court race. 224 00:12:48,080 --> 00:12:48,839 Speaker 4: What did you make of that? 225 00:12:49,040 --> 00:12:52,800 Speaker 5: I think the biggest tell is on average, Democrats have 226 00:12:52,880 --> 00:12:57,080 Speaker 5: been winning special elections by nine or ten points, and 227 00:12:57,160 --> 00:12:59,640 Speaker 5: they exceeded that by almost double in some of those 228 00:12:59,679 --> 00:13:03,000 Speaker 5: races last night. And the margin of victory for Republicans 229 00:13:03,040 --> 00:13:05,800 Speaker 5: in Florida six in Florida's first district was an equal 230 00:13:05,840 --> 00:13:09,400 Speaker 5: fifteen percentage points. And that's down from a plus thirty 231 00:13:09,400 --> 00:13:13,920 Speaker 5: and plus forty position place for Republicans during the November election. 232 00:13:14,120 --> 00:13:17,400 Speaker 5: So just in five or six months, the hemorrhage support. 233 00:13:17,520 --> 00:13:20,360 Speaker 5: It's pretty normal for Democrats to be highly engaged in 234 00:13:20,400 --> 00:13:23,560 Speaker 5: these special elections, but this puts as many as sixty 235 00:13:23,840 --> 00:13:27,280 Speaker 5: House Republican seats in play for the Democratic Party, according 236 00:13:27,320 --> 00:13:29,840 Speaker 5: to the lead Jeffries going into the twenty twenty sixth 237 00:13:29,840 --> 00:13:30,400 Speaker 5: mid terms. 238 00:13:30,440 --> 00:13:32,880 Speaker 2: Just because of radio clarity, they're in the quality of 239 00:13:32,920 --> 00:13:38,000 Speaker 2: our microphones. Sixty six zero District zero. 240 00:13:39,040 --> 00:13:41,920 Speaker 5: Yeah. And you know, to put this in perspective, when 241 00:13:42,160 --> 00:13:47,040 Speaker 5: we had President Trump's first term and the twenty eighteen midterms, 242 00:13:47,280 --> 00:13:50,120 Speaker 5: Democrats were able to pick up forty one seats, and 243 00:13:50,480 --> 00:13:53,720 Speaker 5: in Obama's first term in the twenty ten mid terms, 244 00:13:53,840 --> 00:13:57,240 Speaker 5: Republicans picked up sixty three, so it's it's a very 245 00:13:57,600 --> 00:14:00,240 Speaker 5: appropriate number to have in mind, somewhere between four in 246 00:14:00,320 --> 00:14:01,000 Speaker 5: sixty seats. 247 00:14:01,200 --> 00:14:04,240 Speaker 2: She amazes me. She's a machine every time. It's amazing. 248 00:14:04,280 --> 00:14:12,600 Speaker 2: I'm here a trace Fada partners. Thank you, Thank you. 249 00:14:12,600 --> 00:14:16,200 Speaker 1: You're listening to the Bloomberg Surveillance Podcast. Catch us live 250 00:14:16,280 --> 00:14:19,800 Speaker 1: weekday afternoons from seven to ten am Eastern. Listen on Apple, 251 00:14:19,840 --> 00:14:23,160 Speaker 1: Karplay and Android Otto with the Bloomberg Business app, or 252 00:14:23,320 --> 00:14:25,400 Speaker 1: watch us live on YouTube right. 253 00:14:25,320 --> 00:14:28,120 Speaker 2: Overnew This is like an audible like we did the 254 00:14:28,160 --> 00:14:31,400 Speaker 2: Wisconsin and the Florida elections. Today on a day of trade, 255 00:14:31,480 --> 00:14:34,840 Speaker 2: We're gonna go trade free with Nisha Patel with Paramatic 256 00:14:35,000 --> 00:14:40,600 Speaker 2: hugely popular when she comes on municipal bonds. Okay, David 257 00:14:40,640 --> 00:14:43,160 Speaker 2: Gerr and Janet Lauren. Janet will be with us later. Girl. 258 00:14:44,000 --> 00:14:44,880 Speaker 2: Do we have GUR today? 259 00:14:45,080 --> 00:14:48,040 Speaker 4: I hope we maybe do. Maybe we're talking to those people. 260 00:14:47,800 --> 00:14:52,000 Speaker 2: We're talking to us people. They were in Princeton yesterday. Yes, Harvard, Princeton, 261 00:14:52,000 --> 00:14:55,520 Speaker 2: Columbia and forty eight other Flavor schools are having trouble 262 00:14:55,520 --> 00:14:58,960 Speaker 2: with the federal government of out their budgets. You can't 263 00:14:59,000 --> 00:15:01,960 Speaker 2: buy a Harvard UNI bond. They're all sold to alumni. 264 00:15:02,640 --> 00:15:06,280 Speaker 2: What are they doing when these headlines are there? So 265 00:15:06,480 --> 00:15:10,080 Speaker 2: college education bonds price down, yield. 266 00:15:09,960 --> 00:15:15,520 Speaker 6: Up, not necessarily. You have to remember private schools like Harvard, 267 00:15:15,680 --> 00:15:19,840 Speaker 6: like Princeton, from a balance sheet perspective, are incredibly strong. 268 00:15:20,080 --> 00:15:23,360 Speaker 6: So these are some issuers and deals that will go 269 00:15:23,600 --> 00:15:27,520 Speaker 6: very quickly to some in state issuers. But from a 270 00:15:27,600 --> 00:15:31,920 Speaker 6: quality perspective, you know, generally speaking, you don't see any 271 00:15:31,960 --> 00:15:34,760 Speaker 6: kind of spread widening. Now, the one topic you did 272 00:15:35,120 --> 00:15:40,280 Speaker 6: bring up, impact of maybe any federal aid reduction to 273 00:15:40,680 --> 00:15:45,360 Speaker 6: any municipal issuers. I think that starts affecting more states, 274 00:15:45,600 --> 00:15:48,200 Speaker 6: more local credits. Right, So if you think about states, 275 00:15:49,080 --> 00:15:51,960 Speaker 6: you look at the Medicaid aid that they're receiving on 276 00:15:52,000 --> 00:15:55,200 Speaker 6: an annual basis, Each state is going to have to 277 00:15:55,240 --> 00:15:57,560 Speaker 6: handle this differently, right, depending on the severity of the 278 00:15:57,600 --> 00:16:01,400 Speaker 6: cuts how that impacts each state. But again my main 279 00:16:01,440 --> 00:16:04,040 Speaker 6: point here will be this is no different than any 280 00:16:04,040 --> 00:16:07,040 Speaker 6: state managing their budgets during any sort of an economic 281 00:16:07,240 --> 00:16:10,480 Speaker 6: you know, let's say slow down. Every state has to 282 00:16:11,000 --> 00:16:13,760 Speaker 6: reconcile their budgets. You come up with costs, you come 283 00:16:13,840 --> 00:16:17,720 Speaker 6: up with remny raising measures. But from a credit perspective, 284 00:16:17,720 --> 00:16:19,200 Speaker 6: this is what we're all trying to parse through. 285 00:16:19,840 --> 00:16:23,320 Speaker 4: So, Nisha, I know, one of the interesting issues and 286 00:16:23,400 --> 00:16:26,240 Speaker 4: challenges potentially for the mean US with bond market is 287 00:16:26,240 --> 00:16:30,360 Speaker 4: with the tax legislation and the tax deductibility of interest. 288 00:16:30,440 --> 00:16:31,360 Speaker 4: Where do we stand there? 289 00:16:31,520 --> 00:16:36,080 Speaker 6: Yes, yes, So the administration obviously is a daunting task 290 00:16:36,960 --> 00:16:39,400 Speaker 6: to come up with, roughly let's say fourtullion dollars a 291 00:16:39,480 --> 00:16:42,720 Speaker 6: counteract to the tax cut extension which you're looking to do. 292 00:16:42,880 --> 00:16:46,000 Speaker 6: So the tax exemption of munis has been put on 293 00:16:46,040 --> 00:16:48,480 Speaker 6: the table. This is something that has come up historically before, 294 00:16:48,600 --> 00:16:54,440 Speaker 6: during Prison Obama's administration in twenty fourteen during a budget reform. 295 00:16:54,880 --> 00:16:57,000 Speaker 6: I'm going to simply put it as we put a 296 00:16:57,040 --> 00:17:00,480 Speaker 6: low risk on this happening to where the tax exemption 297 00:17:00,680 --> 00:17:05,520 Speaker 6: of municipal bonds is taken away entirely, and in that 298 00:17:05,560 --> 00:17:07,199 Speaker 6: for that matter, for a majority of the market, we 299 00:17:07,280 --> 00:17:10,639 Speaker 6: just don't see that happening. Why you look at what 300 00:17:10,840 --> 00:17:14,399 Speaker 6: the actual revenue would come from that, let's call it 301 00:17:14,440 --> 00:17:16,920 Speaker 6: twenty five billion a year, two hundred and fifty over 302 00:17:16,960 --> 00:17:21,000 Speaker 6: the next ten years. How do all the infrastructure projects 303 00:17:21,240 --> 00:17:23,680 Speaker 6: get funded in our country right, seventy five to eighty 304 00:17:23,680 --> 00:17:26,320 Speaker 6: percent is through the municipal bond market. Every state, every 305 00:17:26,359 --> 00:17:30,199 Speaker 6: local municipality, building schools, fixing bridges, it's all through the 306 00:17:30,240 --> 00:17:34,080 Speaker 6: MENI market. You would be tripling the cost of financing 307 00:17:34,080 --> 00:17:35,840 Speaker 6: these types of projects if you were to do that 308 00:17:36,160 --> 00:17:40,040 Speaker 6: at a time when this administration is backing right infrastructure 309 00:17:40,040 --> 00:17:43,920 Speaker 6: type projects economic expansion. So this counter acts I think, 310 00:17:44,000 --> 00:17:48,119 Speaker 6: just from a high level perspective that so, I do 311 00:17:48,160 --> 00:17:51,960 Speaker 6: think you could see more noise around this, especially in 312 00:17:52,000 --> 00:17:53,840 Speaker 6: a market like Munis. You know, we have seen some 313 00:17:53,920 --> 00:17:57,080 Speaker 6: weakness in Munis that has been more supply driven in 314 00:17:57,240 --> 00:17:59,480 Speaker 6: market dynamics. But I think this is starting to create 315 00:17:59,480 --> 00:18:01,320 Speaker 6: a little bit more noise. But we put low risk 316 00:18:01,400 --> 00:18:02,080 Speaker 6: on this. 317 00:18:01,840 --> 00:18:06,199 Speaker 2: Is parametric funded the municipal bonds that allowed for the 318 00:18:06,240 --> 00:18:09,400 Speaker 2: paving of fifty ninth Street Park Avenue. 319 00:18:10,080 --> 00:18:11,040 Speaker 6: It's quite possible. 320 00:18:11,240 --> 00:18:12,080 Speaker 3: It was impossible. 321 00:18:13,400 --> 00:18:15,959 Speaker 6: See, don't we need more roads to be paved? 322 00:18:16,359 --> 00:18:19,560 Speaker 2: No, we can't increase the Bentley And it's like I 323 00:18:20,520 --> 00:18:23,400 Speaker 2: need an suv to get through the potholes. Yes, all 324 00:18:23,440 --> 00:18:26,439 Speaker 2: of a sudden, the Bentley was smooth today. Tell me 325 00:18:26,600 --> 00:18:30,000 Speaker 2: about duration. What's the retail trap? Now? Is it to 326 00:18:30,040 --> 00:18:33,000 Speaker 2: buy two short munis or should I be looking at 327 00:18:33,040 --> 00:18:36,159 Speaker 2: what perpetuity or twenty or well, listen, this is. 328 00:18:36,160 --> 00:18:40,240 Speaker 6: A great question. We've seen a pretty tremendous underperformance in 329 00:18:40,280 --> 00:18:44,680 Speaker 6: the municipal bond market. You look at your Broad Bloomberg 330 00:18:44,720 --> 00:18:48,159 Speaker 6: Treasury INEX Corporate indext Q one anywhere up from two 331 00:18:48,200 --> 00:18:50,760 Speaker 6: and a half to three percent. Munis are maybe up 332 00:18:50,760 --> 00:18:53,560 Speaker 6: about seventy five business points. Why, we've seen a lot 333 00:18:53,600 --> 00:18:56,280 Speaker 6: of issuance in the market. This has been the second 334 00:18:56,480 --> 00:19:01,720 Speaker 6: largest quarter in issuance since two thousand and seve Just 335 00:19:01,760 --> 00:19:05,040 Speaker 6: an incredible amount of money and issuance coming to the market. 336 00:19:05,119 --> 00:19:06,880 Speaker 6: A lot of this is a function of issuers wanted 337 00:19:06,880 --> 00:19:09,120 Speaker 6: to get ahead of any volatility that may be coming 338 00:19:09,160 --> 00:19:13,000 Speaker 6: about later this year, just necessary infrastructure projects. So my 339 00:19:13,080 --> 00:19:16,200 Speaker 6: short answer to you is the curve is incredibly steeper. 340 00:19:17,480 --> 00:19:19,280 Speaker 6: You're two to twenty year and the unique curve is 341 00:19:19,320 --> 00:19:22,320 Speaker 6: about one hundred and thirty basis points. You are getting 342 00:19:22,359 --> 00:19:25,680 Speaker 6: paid to extend out in terms of duration right now, 343 00:19:25,800 --> 00:19:28,960 Speaker 6: most municipal bond investors, retail investors are a little scared 344 00:19:28,960 --> 00:19:31,439 Speaker 6: to add duration. This is when you want to be 345 00:19:31,480 --> 00:19:34,200 Speaker 6: looking at that part of the curve. So look at 346 00:19:34,280 --> 00:19:37,320 Speaker 6: you know, ten plus years, particularly fifteen to twenty years, 347 00:19:37,400 --> 00:19:40,680 Speaker 6: you're locking in tax equivalent yields of anywhere from seven 348 00:19:40,720 --> 00:19:46,360 Speaker 6: to eight percent. Think about that, right for high piastics, Yes, large, 349 00:19:46,920 --> 00:19:49,200 Speaker 6: So this I think we're seeing as a pretty tremendous 350 00:19:49,200 --> 00:19:50,200 Speaker 6: buying opportunity. 351 00:19:50,520 --> 00:19:53,440 Speaker 4: Are funds flowing like that? Are funds coming into the 352 00:19:53,520 --> 00:19:54,480 Speaker 4: musicipal bond market? 353 00:19:54,760 --> 00:19:57,879 Speaker 6: That's a great question. So supply has been very high. 354 00:19:57,920 --> 00:20:01,880 Speaker 6: On the demand side. We have been seeing outflows out 355 00:20:01,880 --> 00:20:04,440 Speaker 6: of the municipal bond market and even ets we're seeing 356 00:20:04,440 --> 00:20:06,960 Speaker 6: outflows now this week. We're starting to see that turn. 357 00:20:07,680 --> 00:20:10,119 Speaker 6: But we know in this market when things turn and 358 00:20:10,200 --> 00:20:12,080 Speaker 6: come back in the other direction, they can come in 359 00:20:12,119 --> 00:20:14,760 Speaker 6: a flood. This is when you want to you know, 360 00:20:14,960 --> 00:20:17,000 Speaker 6: at least leg in and start locking in these heels. 361 00:20:17,000 --> 00:20:19,800 Speaker 6: Before you could see heels compressed, were going to count My. 362 00:20:19,720 --> 00:20:21,960 Speaker 2: Response when you're on and let me go back to 363 00:20:21,960 --> 00:20:23,720 Speaker 2: a question I've asked you before, but I think it 364 00:20:23,760 --> 00:20:27,480 Speaker 2: needs to be revisited. Can our listeners and viewers on YouTube, 365 00:20:27,960 --> 00:20:33,040 Speaker 2: can they acquire individual bonds or are they locked out 366 00:20:33,080 --> 00:20:36,080 Speaker 2: by Fidelity, black Rock, Pimco and the rest. 367 00:20:37,400 --> 00:20:40,200 Speaker 6: It depends on how you're accessing these bonds or brokerage, 368 00:20:40,440 --> 00:20:42,720 Speaker 6: you know, platforms that allow you to do this, we 369 00:20:42,760 --> 00:20:46,760 Speaker 6: would advocate, Look, professional management is probably the better route 370 00:20:46,800 --> 00:20:48,359 Speaker 6: to go, right for all the reasons that we talked 371 00:20:48,359 --> 00:20:53,600 Speaker 6: about better positioning credit management. So Tom, I'm still waiting 372 00:20:53,640 --> 00:20:55,200 Speaker 6: for you to open up your account with us, but. 373 00:20:58,680 --> 00:21:02,320 Speaker 2: I'm looking at the TWU wishes it's out somewhere. Yes, 374 00:21:02,600 --> 00:21:05,480 Speaker 2: help me with how many beeps you pick up by 375 00:21:05,520 --> 00:21:09,000 Speaker 2: dealing with adults like you versus sitting on the phone 376 00:21:09,040 --> 00:21:12,480 Speaker 2: trying to get I'll take fifty or I'll take ten 377 00:21:12,560 --> 00:21:17,080 Speaker 2: of the the mateo education, geo of you know whatever. 378 00:21:17,480 --> 00:21:20,960 Speaker 6: Right off the bat, there could be you know, two 379 00:21:21,040 --> 00:21:24,879 Speaker 6: to three percent savings on just the execution two hundred 380 00:21:24,880 --> 00:21:28,439 Speaker 6: beeps on that individual whole, not two hundred beeps a 381 00:21:28,480 --> 00:21:30,399 Speaker 6: two percent of price. So let's say in a ten 382 00:21:30,480 --> 00:21:33,840 Speaker 6: year bond, roughly twenty thirty basis points at least. But 383 00:21:33,960 --> 00:21:37,600 Speaker 6: that's just on the execution, right, Because we're buying as 384 00:21:37,680 --> 00:21:41,640 Speaker 6: professional institutional buyers, we're accessing new issue deals which as 385 00:21:41,680 --> 00:21:43,679 Speaker 6: an individual on the other side, you simply would not 386 00:21:43,720 --> 00:21:45,240 Speaker 6: have access to. You you can only buy it in the 387 00:21:45,280 --> 00:21:48,359 Speaker 6: secondary market exactly. So there's a markup associated with that 388 00:21:49,119 --> 00:21:51,800 Speaker 6: credit management? What is that worth in this environment? I 389 00:21:51,800 --> 00:21:54,320 Speaker 6: would say that is worth a considerable amount. 390 00:21:54,520 --> 00:21:56,639 Speaker 2: What's the pick up on new issues? We've got to 391 00:21:56,680 --> 00:21:58,920 Speaker 2: go here, but what's the basis point pick up? I'm 392 00:21:58,920 --> 00:22:00,960 Speaker 2: buying a new issue for something out there. 393 00:22:01,119 --> 00:22:03,840 Speaker 6: So right now in the ten to fifteen year part 394 00:22:03,880 --> 00:22:05,840 Speaker 6: of the curve, you could easily pick up anywhere from 395 00:22:05,840 --> 00:22:09,480 Speaker 6: twenty to forty basis points depending on just because right 396 00:22:09,560 --> 00:22:11,760 Speaker 6: now you're seeing a lot of issuance. Things are getting 397 00:22:11,760 --> 00:22:13,320 Speaker 6: a little sloppy, as I like to call it. 398 00:22:13,440 --> 00:22:14,360 Speaker 2: Are you taking this is. 399 00:22:14,359 --> 00:22:17,840 Speaker 6: When you want a professional manager to be accessing the 400 00:22:17,880 --> 00:22:20,560 Speaker 6: new issue market. So parametric is a way to do it. 401 00:22:20,640 --> 00:22:24,040 Speaker 4: Tom I A ladder, dimunitionible portfolio is what I have, 402 00:22:24,320 --> 00:22:26,720 Speaker 4: light duration half for thirty years. 403 00:22:27,320 --> 00:22:28,159 Speaker 2: That's how you play it. 404 00:22:28,280 --> 00:22:32,960 Speaker 4: Yeah, yeah, clip and coupon the high steing Jersey triple tax. 405 00:22:33,520 --> 00:22:38,000 Speaker 2: Yes, I have a ladder, a laddered tuition polio. 406 00:22:38,320 --> 00:22:40,119 Speaker 6: All right, we need to talk about that after this 407 00:22:40,320 --> 00:22:40,720 Speaker 6: we do. 408 00:22:43,359 --> 00:22:46,639 Speaker 2: This is great. We got a huge response when we're 409 00:22:46,680 --> 00:22:49,120 Speaker 2: having me she is with parametric, we don't take enough 410 00:22:49,160 --> 00:22:52,120 Speaker 2: advantage of a discussion of the simple rond score. 411 00:22:52,359 --> 00:22:56,199 Speaker 1: This is the Bloomberg Surveillance Podcast. Listen live each weekday 412 00:22:56,280 --> 00:22:59,280 Speaker 1: starting at seven am Eastern on Apple Corplay and Android 413 00:22:59,280 --> 00:23:02,320 Speaker 1: Auto with the Bloomberg Business Up. You can also listen 414 00:23:02,440 --> 00:23:05,680 Speaker 1: live on Amazon Alexa from our flagship New York station, 415 00:23:06,240 --> 00:23:08,879 Speaker 1: Just say Alexa Play Bloomberg eleven thirty. 416 00:23:09,000 --> 00:23:11,840 Speaker 2: Peter Sheer goes to the heart of the matter on 417 00:23:12,040 --> 00:23:15,280 Speaker 2: this event at four pm this afternoon of the President 418 00:23:15,280 --> 00:23:18,080 Speaker 2: of the United States, and he takes it right back 419 00:23:18,119 --> 00:23:21,080 Speaker 2: to the Codahammarabi and of course on the Hebrew law 420 00:23:21,080 --> 00:23:24,000 Speaker 2: as well in Exodus. And that is his concept of 421 00:23:24,040 --> 00:23:28,160 Speaker 2: grievance and retribution. And I for an eye Peter Shaer 422 00:23:28,200 --> 00:23:32,159 Speaker 2: with this brilliant note from Academy Securities. How I for 423 00:23:32,359 --> 00:23:34,359 Speaker 2: an eye is America this morning? 424 00:23:34,800 --> 00:23:36,840 Speaker 7: It feels very much so. And I think that's part 425 00:23:36,880 --> 00:23:39,760 Speaker 7: of the problem. Right, It's where did this first I start? Right, 426 00:23:39,800 --> 00:23:42,159 Speaker 7: it's you know, we're now complaining about Tara stup. We're 427 00:23:42,160 --> 00:23:45,719 Speaker 7: put on us. But I think it's a wrong attitude, 428 00:23:45,800 --> 00:23:48,880 Speaker 7: and I think we're pushing people away. And although we're 429 00:23:48,920 --> 00:23:51,000 Speaker 7: really focused today on tariffs, I think we have to 430 00:23:51,000 --> 00:23:53,600 Speaker 7: take one step back and say everything else is going 431 00:23:53,680 --> 00:23:56,560 Speaker 7: on geopolitically, is also pushing our friends and allies away 432 00:23:56,560 --> 00:23:59,399 Speaker 7: from us. How we're handling NATO, how we're having Russia, Ukraine, 433 00:23:59,760 --> 00:24:02,520 Speaker 7: the language in and around Greenland, the language in and 434 00:24:02,520 --> 00:24:06,080 Speaker 7: around Canada. I think there's this real concern that's going away, 435 00:24:06,080 --> 00:24:08,399 Speaker 7: and you're starting to see it occur geopolitically, where all 436 00:24:08,440 --> 00:24:10,719 Speaker 7: of a sudden, Japan, China, and South Korea are talking, 437 00:24:10,960 --> 00:24:15,040 Speaker 7: Canada and Mexico are talking directly. I think we've overstated, 438 00:24:15,240 --> 00:24:17,399 Speaker 7: you know, quote unquote our hands or what our cards 439 00:24:17,400 --> 00:24:20,159 Speaker 7: we hold. And I think, no matter what happens today 440 00:24:20,320 --> 00:24:22,280 Speaker 7: two three weeks later, our stock markets are gonna be 441 00:24:22,280 --> 00:24:24,520 Speaker 7: lower as we realize that we are kind of destroying 442 00:24:24,560 --> 00:24:25,480 Speaker 7: the American brand. 443 00:24:25,880 --> 00:24:29,280 Speaker 4: Are you surprised that there hasn't been any more pushback 444 00:24:29,320 --> 00:24:33,880 Speaker 4: against this president in this administration from Congress broadly defined 445 00:24:34,040 --> 00:24:36,760 Speaker 4: is to some of these bigger issues, you. 446 00:24:36,720 --> 00:24:39,399 Speaker 7: Know, I think it's so early in his administration. He 447 00:24:39,520 --> 00:24:41,879 Speaker 7: won with a pretty clear mandate, so I think everyone 448 00:24:41,960 --> 00:24:44,880 Speaker 7: was going to let it play out. And I think 449 00:24:44,920 --> 00:24:47,199 Speaker 7: this time around, the one thing he did, clearly from 450 00:24:47,240 --> 00:24:50,240 Speaker 7: his perspective, is he filled up his posts much quicker 451 00:24:50,280 --> 00:24:50,880 Speaker 7: than last time. 452 00:24:50,960 --> 00:24:51,160 Speaker 2: YEP. 453 00:24:51,200 --> 00:24:54,120 Speaker 7: But he picked people who are really on board with him, 454 00:24:54,200 --> 00:24:57,400 Speaker 7: particularly on tariffs. Almost every single person in his cabinet 455 00:24:57,440 --> 00:25:01,160 Speaker 7: believes tariff's work, and so I'm not we're not seeing pushback. 456 00:25:01,400 --> 00:25:03,240 Speaker 7: Maybe some of the voting last night, maybe that would 457 00:25:03,240 --> 00:25:04,920 Speaker 7: be the first wave that people should raise their hands 458 00:25:04,960 --> 00:25:07,080 Speaker 7: and say, hey, maybe we need to change this a 459 00:25:07,080 --> 00:25:07,480 Speaker 7: little bit. 460 00:25:07,560 --> 00:25:11,080 Speaker 2: The advantage you have in folks, Academy securities has a 461 00:25:11,200 --> 00:25:16,080 Speaker 2: huge military tenor of excellence of admirals and generals on 462 00:25:16,119 --> 00:25:18,919 Speaker 2: their board as well. The heart of the matter is 463 00:25:18,920 --> 00:25:25,120 Speaker 2: he's tearing asunder the Atlantic Charter off of Newfoundland nineteen 464 00:25:25,240 --> 00:25:28,280 Speaker 2: forty one. I mean, and George Bood Senior, who was 465 00:25:28,320 --> 00:25:30,840 Speaker 2: hauled out of the Pacific Ocean, you know, on a 466 00:25:30,880 --> 00:25:34,359 Speaker 2: down airplane onto a suburb at midway. We're going on 467 00:25:34,480 --> 00:25:38,720 Speaker 2: beyond that. Do your people in Academy's security say we're 468 00:25:38,760 --> 00:25:41,760 Speaker 2: staggering into a new era or is this a moment 469 00:25:41,880 --> 00:25:43,119 Speaker 2: than where we'd pull back. 470 00:25:43,840 --> 00:25:46,840 Speaker 7: I think everyone's torn, and you know, like everyone else, 471 00:25:46,840 --> 00:25:49,200 Speaker 7: I'm sure there's varying degrees, but I would say, you know, 472 00:25:49,240 --> 00:25:50,920 Speaker 7: one thing that comes up in conversations right all of 473 00:25:50,920 --> 00:25:53,400 Speaker 7: a sudden, this talk about Greenland, the polar ice cap Well, 474 00:25:53,480 --> 00:25:56,560 Speaker 7: Canada has I believe it's twenty summut ice breakers, rush 475 00:25:56,600 --> 00:25:58,880 Speaker 7: ass forty something. The US is about five. So if 476 00:25:58,880 --> 00:26:00,840 Speaker 7: we are that worried, why don't we have icebreakers? Why 477 00:26:00,840 --> 00:26:02,760 Speaker 7: aren't we more prepared for this? Greenland seems like a 478 00:26:02,800 --> 00:26:04,560 Speaker 7: weird way to do it. I think there's a lot 479 00:26:04,560 --> 00:26:06,800 Speaker 7: of questions about the messaging. We used to have three, 480 00:26:07,160 --> 00:26:09,359 Speaker 7: you know, bases in Greenland. Why not just talk to 481 00:26:09,400 --> 00:26:11,360 Speaker 7: Greenland and try and re established two if we think 482 00:26:11,359 --> 00:26:14,040 Speaker 7: it's that important. So I think it's the messaging and 483 00:26:14,400 --> 00:26:16,399 Speaker 7: how we're going about it, maybe necessarily than the what 484 00:26:16,920 --> 00:26:18,520 Speaker 7: that is causing a lot of consternation. 485 00:26:18,720 --> 00:26:20,480 Speaker 2: Paul jump in here because I'm just going to talk 486 00:26:20,520 --> 00:26:24,760 Speaker 2: submarines in the data story a turn off the show, 487 00:26:25,280 --> 00:26:26,480 Speaker 2: Save me, Paul, Peter. 488 00:26:26,600 --> 00:26:29,640 Speaker 4: So, given all those that level of uncertainty, just whether 489 00:26:29,640 --> 00:26:33,320 Speaker 4: it's economic uncertainty, political uncertainty, military uncertainty that seems to 490 00:26:33,359 --> 00:26:36,960 Speaker 4: have been engendered over the past several months, what do 491 00:26:36,960 --> 00:26:39,240 Speaker 4: you tell your clients about investing these days? 492 00:26:39,280 --> 00:26:41,400 Speaker 7: Well, one, I actually think there's a high degree of certainty, 493 00:26:41,720 --> 00:26:44,119 Speaker 7: and the certainty is not good right. The certainty is 494 00:26:44,200 --> 00:26:46,679 Speaker 7: one other countries are now playing US very differently. If 495 00:26:46,720 --> 00:26:48,760 Speaker 7: you go back to g G made a trip to 496 00:26:48,800 --> 00:26:51,600 Speaker 7: Marrow Lago very early in Trump one point zero. Every 497 00:26:51,640 --> 00:26:54,600 Speaker 7: time Trump mentioned tariffs, China had some sort of trade delegation. 498 00:26:54,920 --> 00:26:56,840 Speaker 7: This time China's sitting there and saying, oh, yes, sir, 499 00:26:56,880 --> 00:26:58,680 Speaker 7: may I have another, Yes, sir, may have another. They're 500 00:26:58,720 --> 00:27:01,199 Speaker 7: moving along. I think we have bitten off way more 501 00:27:01,240 --> 00:27:03,600 Speaker 7: than we can choose. So again, at thirty trillion dollar 502 00:27:03,680 --> 00:27:06,520 Speaker 7: GDP or the largest economy, why we've chosen to fight 503 00:27:06,560 --> 00:27:08,760 Speaker 7: with the eighty trillion rest of the world is a 504 00:27:08,800 --> 00:27:11,520 Speaker 7: little bit unclear. And one thing that I think about 505 00:27:11,520 --> 00:27:13,560 Speaker 7: a lot. I think this is really representive what's going 506 00:27:13,600 --> 00:27:16,120 Speaker 7: to happen going down the road. Is three months ago, 507 00:27:16,280 --> 00:27:18,040 Speaker 7: if you told me Germany was going to spend hundreds 508 00:27:18,040 --> 00:27:21,120 Speaker 7: of billion dollars on military equipments, US defense stocks would 509 00:27:21,119 --> 00:27:24,159 Speaker 7: have skyrocketed. They are not because Germany doesn't want to 510 00:27:24,160 --> 00:27:27,800 Speaker 7: buy American equipment. And I think this ending of the 511 00:27:27,840 --> 00:27:30,720 Speaker 7: American brand is my biggest concern, and. 512 00:27:30,720 --> 00:27:32,800 Speaker 2: Bring it over to the market. Let's bring it over 513 00:27:32,840 --> 00:27:36,320 Speaker 2: to the world of Peter sheheer from this geopolitical moment again, 514 00:27:36,440 --> 00:27:39,280 Speaker 2: Coverage this afternoon, really coverage all day folks and into 515 00:27:39,320 --> 00:27:43,040 Speaker 2: tomorrow Douglas, Heroin and Dartmouth, where this tomorrow owns the 516 00:27:43,119 --> 00:27:45,760 Speaker 2: high ground on this debate. Bring it over to the 517 00:27:45,840 --> 00:27:49,080 Speaker 2: markets then, So is there a sheer opportunity here? 518 00:27:49,320 --> 00:27:51,560 Speaker 7: I think you maybe sit through. It feels like the 519 00:27:51,560 --> 00:27:54,000 Speaker 7: market wants to rally no matter almost what has said. 520 00:27:54,280 --> 00:27:55,560 Speaker 7: Then I think you want to fade this. I think 521 00:27:55,560 --> 00:27:57,439 Speaker 7: we're going to be down another ten twenty percent in 522 00:27:57,480 --> 00:27:59,639 Speaker 7: the s and P five hundred in the coming weeks 523 00:27:59,640 --> 00:28:02,480 Speaker 7: and months. Has the reality of what we've done right everything? 524 00:28:02,600 --> 00:28:05,320 Speaker 2: So you're talking negative thirty five percent drawdown? 525 00:28:05,480 --> 00:28:07,760 Speaker 7: Yeah, negative twenty five to thirty five percent. I think 526 00:28:07,800 --> 00:28:09,640 Speaker 7: this is going to be a severe problem. I keep 527 00:28:09,640 --> 00:28:12,480 Speaker 7: thinking back to Japan nineteen eighty nine, ninety ninety. Was 528 00:28:12,520 --> 00:28:14,919 Speaker 7: anyone sitting there at the Nike wondering, oh, yeah, we're 529 00:28:14,920 --> 00:28:16,440 Speaker 7: gonna be down sixty percent in a year and not 530 00:28:16,520 --> 00:28:19,119 Speaker 7: recover for thirty years. No, And I feel like some 531 00:28:19,200 --> 00:28:21,159 Speaker 7: of what's going on puts us in that sort of position. 532 00:28:21,359 --> 00:28:23,640 Speaker 7: The world is moving away from us. We don't have 533 00:28:23,760 --> 00:28:25,600 Speaker 7: the cards that we think we have, and on top 534 00:28:25,600 --> 00:28:28,040 Speaker 7: of that, the supply chains aren't ready even if we 535 00:28:28,080 --> 00:28:29,639 Speaker 7: are successful. And I don't think we're going to be 536 00:28:29,680 --> 00:28:32,240 Speaker 7: successful in getting companies. It's a two to seven year 537 00:28:32,320 --> 00:28:35,640 Speaker 7: project to build manufacturing facilities here to get the robots 538 00:28:35,760 --> 00:28:39,160 Speaker 7: in place. I think we've misplayed very badly here. 539 00:28:40,360 --> 00:28:42,680 Speaker 4: So we've seen a movement just in a stock market. 540 00:28:42,960 --> 00:28:46,160 Speaker 4: Rest of world dramatically outperforming the US S and P 541 00:28:46,280 --> 00:28:49,000 Speaker 4: five hundred year to date in the first quarter. Is 542 00:28:49,000 --> 00:28:51,160 Speaker 4: that a short term trade? Is that something more? Are 543 00:28:51,160 --> 00:28:54,160 Speaker 4: you telling clients you think about Europe, think about Japan. 544 00:28:54,400 --> 00:28:56,680 Speaker 7: I continue to like China, probably better than the other places. 545 00:28:56,720 --> 00:28:58,880 Speaker 7: I think China's gonna be the big beneficiary. I think 546 00:28:58,960 --> 00:29:01,640 Speaker 7: right now every market come down a little bit. But 547 00:29:01,680 --> 00:29:03,719 Speaker 7: the one thing again, I think we really missed how 548 00:29:03,760 --> 00:29:07,320 Speaker 7: many intangibles the US benefited from its position as this 549 00:29:07,440 --> 00:29:11,600 Speaker 7: kind of benevolent superpower. One. We really benefit from capital flows. 550 00:29:11,840 --> 00:29:14,120 Speaker 7: Capital flooded into the US. Everyone wanted to be in 551 00:29:14,120 --> 00:29:16,840 Speaker 7: the US from an investment standpoint. That is now turning. 552 00:29:16,880 --> 00:29:19,640 Speaker 7: People don't want planing equipment here necessarily. They're trying to 553 00:29:19,640 --> 00:29:22,960 Speaker 7: figure this out. So I think capital outflows continue. 554 00:29:23,440 --> 00:29:26,520 Speaker 2: I gotta bring this was this like, can't we do it? 555 00:29:26,600 --> 00:29:28,720 Speaker 2: Like eight hour show today? Rich? 556 00:29:29,240 --> 00:29:29,400 Speaker 5: Rich? 557 00:29:29,440 --> 00:29:32,000 Speaker 2: Can you find out talk to management see if we 558 00:29:32,040 --> 00:29:36,080 Speaker 2: can extend this out. I Peter, this is fascinating, And 559 00:29:36,120 --> 00:29:37,840 Speaker 2: to me, the heart of the matter is, I'm going 560 00:29:37,880 --> 00:29:41,680 Speaker 2: to assume Academy Securities has somewhere there's a token Democrat 561 00:29:41,680 --> 00:29:46,240 Speaker 2: in the step. But this is the president's Republican party 562 00:29:46,960 --> 00:29:52,240 Speaker 2: versus George Bush Senior's Republican Party. You're talking like there's 563 00:29:52,280 --> 00:29:55,640 Speaker 2: a permanence to Trump trade policy. 564 00:29:56,480 --> 00:29:59,360 Speaker 7: I think we You know, if you're in a relationship 565 00:29:59,680 --> 00:30:01,280 Speaker 7: and you say that one thing that you know you 566 00:30:01,280 --> 00:30:02,720 Speaker 7: should not have said, because you can't. 567 00:30:02,560 --> 00:30:04,680 Speaker 2: Go back to doing it, listen. 568 00:30:05,360 --> 00:30:07,360 Speaker 7: And I'm not very good at relationships, but it does 569 00:30:07,400 --> 00:30:09,680 Speaker 7: strike me that we've gone past that moment where we've 570 00:30:09,720 --> 00:30:12,320 Speaker 7: done enough that people don't trust us, that we're trying 571 00:30:12,360 --> 00:30:16,760 Speaker 7: to retrade everything again. U smca, Oh wow, Yeah, maybe 572 00:30:16,760 --> 00:30:20,360 Speaker 7: we should exempt autos. And you've seen mistake after mistake made. 573 00:30:20,440 --> 00:30:20,640 Speaker 2: Right. 574 00:30:21,280 --> 00:30:24,600 Speaker 7: Why are we now having to bail out farmers for 575 00:30:24,680 --> 00:30:28,120 Speaker 7: their input costs? Well, their input costs are largely fertilizer podash, 576 00:30:28,160 --> 00:30:30,360 Speaker 7: things coming from Canada that we just slapped tariffs on. 577 00:30:30,560 --> 00:30:32,440 Speaker 7: So tarifs are supposed to be a revenue generator, but 578 00:30:32,480 --> 00:30:34,000 Speaker 7: now we're having to spend the money. I think this 579 00:30:34,040 --> 00:30:37,240 Speaker 7: has been done very poorly, very haphazardly. I think if 580 00:30:37,280 --> 00:30:39,560 Speaker 7: Bessentt was truly in charge, this would have been played 581 00:30:39,560 --> 00:30:41,560 Speaker 7: out over six months, it would have been organized, it 582 00:30:41,560 --> 00:30:44,560 Speaker 7: would have been timely. I think it's been very random, 583 00:30:44,640 --> 00:30:46,880 Speaker 7: and I think we have actually broken relationships that I 584 00:30:46,880 --> 00:30:48,040 Speaker 7: don't think are repaired easily. 585 00:30:48,120 --> 00:30:50,640 Speaker 2: You got a gold call, Lisa wants to know you. 586 00:30:51,160 --> 00:30:52,640 Speaker 2: You're talking gold four thousand. 587 00:30:52,960 --> 00:30:55,800 Speaker 7: No, no gold call. I do think crypto is actually 588 00:30:55,800 --> 00:30:57,360 Speaker 7: going to fall down a little bit. I think Crypto's 589 00:30:57,360 --> 00:30:58,600 Speaker 7: going to bear the brunt of a lot of this. 590 00:30:58,680 --> 00:31:00,400 Speaker 7: I think people are going to be disappointed. 591 00:31:00,120 --> 00:31:02,320 Speaker 2: By a lot ten am and that's the. 592 00:31:02,320 --> 00:31:05,320 Speaker 7: Other reason to me, crypto has become much more part 593 00:31:05,360 --> 00:31:07,680 Speaker 7: of the US dock market, whether it's MSTR being in 594 00:31:07,680 --> 00:31:10,680 Speaker 7: the Nasdaq one hundred, the Bitcoin ETFs, it's in people's 595 00:31:10,680 --> 00:31:14,000 Speaker 7: equity portfolios. I think this whole thing kind of comes 596 00:31:14,040 --> 00:31:16,560 Speaker 7: down together. And to me, I want to see Crypto 597 00:31:16,600 --> 00:31:20,000 Speaker 7: come down significantly from here, maybe to fifty sixty thousand, 598 00:31:20,280 --> 00:31:22,400 Speaker 7: and I want to see the NASDAK come down. I 599 00:31:22,400 --> 00:31:25,040 Speaker 7: also keep looking at TQQQ, which is a weird triple 600 00:31:25,080 --> 00:31:28,200 Speaker 7: leverage GTF, but it represents about sixty billion dollars keeps 601 00:31:28,200 --> 00:31:30,720 Speaker 7: getting inflows. I need to see capitulation on that to 602 00:31:30,960 --> 00:31:31,840 Speaker 7: be bullish. 603 00:31:31,840 --> 00:31:33,880 Speaker 2: Peer's here. Come back when you get more negative. Pierce 604 00:31:33,920 --> 00:31:35,480 Speaker 2: share here, Academy Securities. 605 00:31:41,920 --> 00:31:45,840 Speaker 1: This is the Bloomberg Surveillance Podcast. Listen live each weekday 606 00:31:45,880 --> 00:31:49,200 Speaker 1: starting at seven am Eastern on Applecarplay and Android Auto 607 00:31:49,280 --> 00:31:52,120 Speaker 1: with the Bloomberg Business app. You can also watch us 608 00:31:52,160 --> 00:31:56,320 Speaker 1: live every weekday on YouTube and always on the Bloomberg terminals. 609 00:31:56,360 --> 00:31:58,720 Speaker 2: Get right to it. I know it is newspaper Day 610 00:31:58,760 --> 00:32:02,280 Speaker 2: with Lisa Mateo and she'd like twelve, are you torpedo 611 00:32:02,360 --> 00:32:04,000 Speaker 2: bat free this morning? 612 00:32:04,080 --> 00:32:06,600 Speaker 8: Yes I am, but well you're swinging some home runs. 613 00:32:06,600 --> 00:32:08,520 Speaker 4: Okay, So here we go. 614 00:32:08,920 --> 00:32:10,560 Speaker 8: We have a lot of stories about the price of 615 00:32:10,640 --> 00:32:13,120 Speaker 8: so many things going higher, right we've been talking about. 616 00:32:13,400 --> 00:32:15,320 Speaker 8: Now we add to this. This is this interesting story 617 00:32:15,320 --> 00:32:19,080 Speaker 8: about medical care affordability. This was study from West Health 618 00:32:19,120 --> 00:32:21,640 Speaker 8: and Gallup and found it eleven percent of Americans said 619 00:32:21,640 --> 00:32:25,080 Speaker 8: they could not pay for medication medical treatments within the 620 00:32:25,120 --> 00:32:28,000 Speaker 8: past three months. So this is of lately things paying 621 00:32:28,080 --> 00:32:31,160 Speaker 8: like a doctor's visit, prescription drugs, things like that. More 622 00:32:31,200 --> 00:32:33,440 Speaker 8: than a third said that if they were to need 623 00:32:33,560 --> 00:32:35,840 Speaker 8: medical care, they wouldn't be able to afford it. And 624 00:32:35,880 --> 00:32:37,800 Speaker 8: it's also an interesting thing because it showed that this 625 00:32:38,160 --> 00:32:41,360 Speaker 8: widing disparity among black and Hispanic adults also those making 626 00:32:41,400 --> 00:32:44,600 Speaker 8: the least amount of money to the reason why they're 627 00:32:44,600 --> 00:32:47,240 Speaker 8: saying is higher premiums, things like the added cost of 628 00:32:47,320 --> 00:32:50,400 Speaker 8: going to the doctor, recent rollbacks and Medicaid coverage on 629 00:32:50,440 --> 00:32:52,400 Speaker 8: top of it. So with this really interesting look at 630 00:32:52,480 --> 00:32:55,560 Speaker 8: here's yet another thing that people are having trouble affording. 631 00:32:55,600 --> 00:32:56,640 Speaker 4: It's kind of important too. 632 00:32:56,880 --> 00:32:59,840 Speaker 8: Yeah, most definitely. No, definitely medical care, definitely. I want 633 00:32:59,840 --> 00:33:03,080 Speaker 8: to equipmentical go to weight loss drugs. We talk a 634 00:33:03,080 --> 00:33:06,360 Speaker 8: lot about it, right the f Yeah, the FTA because 635 00:33:06,400 --> 00:33:09,720 Speaker 8: Tom loves it. They're about here's the overall factor. The 636 00:33:09,800 --> 00:33:12,400 Speaker 8: FDA is about to take away Telehealth Company's license to 637 00:33:12,440 --> 00:33:14,040 Speaker 8: sell these knockoff weight loss drugs. 638 00:33:14,080 --> 00:33:14,240 Speaker 4: Right. 639 00:33:14,560 --> 00:33:16,720 Speaker 8: They gave them the green light when the drugs run 640 00:33:16,800 --> 00:33:19,480 Speaker 8: short supply, So now it's time the supply is back, 641 00:33:19,520 --> 00:33:22,280 Speaker 8: so they have to take away this license. So now 642 00:33:22,360 --> 00:33:26,120 Speaker 8: things are changing. It's causing this workplace battle, like who's 643 00:33:26,160 --> 00:33:28,880 Speaker 8: going to pay for the GLP ones like ozembic now 644 00:33:28,880 --> 00:33:29,840 Speaker 8: that they're a little. 645 00:33:29,640 --> 00:33:33,080 Speaker 2: Bit more expensive expensive, right, did I write nine hundred 646 00:33:33,080 --> 00:33:33,840 Speaker 2: dollars something? 647 00:33:34,000 --> 00:33:34,120 Speaker 3: So? 648 00:33:34,200 --> 00:33:37,120 Speaker 8: But yeah, because you can get them before from MI 649 00:33:37,280 --> 00:33:39,280 Speaker 8: these knockoffs for about two hundred, and now you have 650 00:33:39,280 --> 00:33:41,160 Speaker 8: to pay like five hundred. So there's there's a big 651 00:33:41,160 --> 00:33:43,440 Speaker 8: difference in price. So who's going to pay for it? 652 00:33:43,480 --> 00:33:46,560 Speaker 8: Will the company pay for the employees weight loss drugs? 653 00:33:46,640 --> 00:33:48,880 Speaker 8: Or will they not? I mean some stopped and they 654 00:33:48,920 --> 00:33:50,800 Speaker 8: said we're not doing it. Others said, you know what, 655 00:33:50,840 --> 00:33:52,920 Speaker 8: we're going to keep this because it's going to help 656 00:33:53,000 --> 00:33:56,600 Speaker 8: us a train and attract talent and and attract talent too. 657 00:33:57,240 --> 00:33:58,440 Speaker 4: So I want to look back there. Do we know 658 00:33:58,440 --> 00:34:01,680 Speaker 4: what percentage of people are using these things these days? 659 00:34:01,840 --> 00:34:02,120 Speaker 2: A lot? 660 00:34:02,520 --> 00:34:04,840 Speaker 8: It definitely does seem like a lot, and a lot 661 00:34:04,880 --> 00:34:07,000 Speaker 8: of people are staying on it. I don't like people 662 00:34:07,040 --> 00:34:08,600 Speaker 8: who've gone on it. I've known some people who have 663 00:34:08,600 --> 00:34:11,640 Speaker 8: gotten off of it and kind of maintain but then 664 00:34:11,680 --> 00:34:13,520 Speaker 8: they have to kind of jump back on again. Yep, 665 00:34:13,560 --> 00:34:17,000 Speaker 8: when they start to fall back. But it's this idea 666 00:34:17,080 --> 00:34:19,080 Speaker 8: of who is going to pay for it? Well, the 667 00:34:19,080 --> 00:34:21,480 Speaker 8: company kind of pony over the money for it in insurance. 668 00:34:22,600 --> 00:34:25,200 Speaker 8: And the last thing we've been talking about, President Trump's 669 00:34:25,200 --> 00:34:28,600 Speaker 8: tariff announcement right later today, here's an interesting take. The 670 00:34:28,600 --> 00:34:31,480 Speaker 8: Wall Street Journal is saying that Brazil could be this 671 00:34:31,600 --> 00:34:34,200 Speaker 8: big winner in the trade war. So they're saying they 672 00:34:34,239 --> 00:34:38,040 Speaker 8: have these certain advantages. For example, Brazilian suppliers everything from 673 00:34:38,120 --> 00:34:40,880 Speaker 8: cotton to chicken, they're looking to hire demand from China, 674 00:34:41,000 --> 00:34:43,040 Speaker 8: so that's the main point. So they're saying that that 675 00:34:43,160 --> 00:34:49,560 Speaker 8: trade relationship has expanded. Chinese buyers stockpiling Brazilian soybeans. So 676 00:34:49,680 --> 00:34:52,239 Speaker 8: at the same time, Brazil has opportunities to boost exports 677 00:34:52,360 --> 00:34:56,200 Speaker 8: to the US and other countries because it's the biggest producer, 678 00:34:56,280 --> 00:34:59,919 Speaker 8: for example, of footwear outside of Asia, so they're hoping 679 00:35:00,080 --> 00:35:02,959 Speaker 8: they can send more shoes to the US in place 680 00:35:02,960 --> 00:35:04,920 Speaker 8: of Chinese products. So they're putting what. 681 00:35:04,760 --> 00:35:09,040 Speaker 2: You're talking about is the complexity of these discussions with 682 00:35:09,160 --> 00:35:14,520 Speaker 2: Jason Furman in five minutes versus the simplicity the theory 683 00:35:14,560 --> 00:35:17,640 Speaker 2: of simplicity that we're getting picked by tick here. 684 00:35:17,640 --> 00:35:20,480 Speaker 4: Ye, yes, really from every Yeah, and the devil's in 685 00:35:20,480 --> 00:35:21,000 Speaker 4: the details. 686 00:35:21,040 --> 00:35:21,719 Speaker 5: We'll see how this. 687 00:35:22,719 --> 00:35:24,840 Speaker 2: Will there be details today though I don't know, I 688 00:35:24,880 --> 00:35:27,239 Speaker 2: don't know. I have no idea, Lisa, do you have 689 00:35:27,239 --> 00:35:29,319 Speaker 2: an angle here? If you talk to the White House 690 00:35:29,360 --> 00:35:29,600 Speaker 2: on the. 691 00:35:29,560 --> 00:35:33,319 Speaker 8: Last time yet not yet. It's on my agenda, Lisa. 692 00:35:33,000 --> 00:35:35,680 Speaker 2: Mateo, the newspapers this morning. Thank you, there's so much. 693 00:35:36,320 --> 00:35:41,200 Speaker 1: This is the Bloomberg Surveillance Podcast, available on Apple, Spotify, 694 00:35:41,320 --> 00:35:45,080 Speaker 1: and anywhere else you get your podcasts. Listen live each 695 00:35:45,120 --> 00:35:48,920 Speaker 1: weekday seven to ten am Easter and on Bloomberg dot com, 696 00:35:49,080 --> 00:35:52,920 Speaker 1: the iHeartRadio app, tune In, and the Bloomberg Business app. 697 00:35:53,200 --> 00:35:56,320 Speaker 1: You can also watch us live every weekday on YouTube 698 00:35:56,600 --> 00:35:58,640 Speaker 1: and always on the Bloomberg terminal.