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Speaker 1: Ye. Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keane

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Speaker 1: jay Ley. We bring you insight from the best in economics, finance, investment,

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Speaker 1: and international relations. Find Bloomberg Surveillance on Apple Podcasts, SoundCloud,

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Speaker 1: Bloomberg dot Com, and of course on the Bloomberg Kathy

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Speaker 1: Fisher with us. She is with Bernstein, and she's very

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Speaker 1: good at trying to get us to talk about the

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Speaker 1: long term, like I'm thinking Monday, John, you know, get

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Speaker 1: out to the long term Monday or maybe to the

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Speaker 1: end of the year. Cathy, what a tumultuous time. Do

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Speaker 1: you have the same conversations now that you would have

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Speaker 1: any time over the last twelve years. Actually no, And

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Speaker 1: the reason for that is that everything that's happened in

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Speaker 1: the past few years has created this sense that really

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Speaker 1: significant change is under way. I e. The multiple decades

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Speaker 1: of globalization that let companies improve their margins their efficiency

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Speaker 1: over time has starting to reverse, and that companies now

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Speaker 1: have to figure out a different way of operating no

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Speaker 1: matter what business they're in. So that sense of change

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Speaker 1: is creating a lot of anxiety, but also I think

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Speaker 1: respect for the fact that companies aren't panicking but rather

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Speaker 1: trying to figure out how to deal with this. This

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Speaker 1: is the arch question. We've been with you through the morning.

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Speaker 1: You've been brilliant on this. I'm looking at the screen, John,

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Speaker 1: and I are seeing a screen basically we've never seen before.

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Speaker 1: It doesn't have a leverage of your arch theme is

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Speaker 1: corporate management will adapt to the times. What's your level

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Speaker 1: of confidence in that? It's actually pretty high. Um. Not

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Speaker 1: every company obviously, but when you look across each sector,

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Speaker 1: everyone's being disrupted by technology, by changing consumer behaviors, and

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Speaker 1: now by globalization. But people just don't laid down and

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Speaker 1: take it. They figured out how do we deal with

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Speaker 1: these changes? And when you what this quarter's earnings are

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Speaker 1: going to be particularly interesting as we look to see

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Speaker 1: how companies are indeed where on the income statement. I

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Speaker 1: think it's going to be Um, not so much what's

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Speaker 1: happened in the past, but what they're saying about the future.

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Speaker 1: And clearly revenues are what matters, So there's a lot

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Speaker 1: of that focus. And also on the cost side, as

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Speaker 1: somebody start to figure out, you know, are we paying

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Speaker 1: more for people in tight labor market? Do we have

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Speaker 1: to change our supply change? And how long will it

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Speaker 1: take to do that, lots of change of foot John

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Speaker 1: Ferrell just eighteen months looking at Apple with all the

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Speaker 1: headaches they've had, they're up eighteen per annualized. Yeah, I'm

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Speaker 1: just saying, corporate, you'll think of Apple, think of the headaches.

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Speaker 1: So there's a report several hours ago from Japan's Nick

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Speaker 1: that said HP down, Microsoft's shift some production from China, Cathy,

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Speaker 1: do we have to get used to those kind of headlines? Yes,

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Speaker 1: clearly every company is saying, how do I ensure that

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Speaker 1: I have a stable supply chain knowing that tariffs can

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Speaker 1: occur anywhere now and probably more diversification of supply chains

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Speaker 1: will be a more normal course of business as it

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Speaker 1: should be. You've got risk everywhere now, and it's not

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Speaker 1: just the US imposing tarrorifts, but you've got other countries

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Speaker 1: doing the same as well. So you can see how

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Speaker 1: there's going to be a lot of distribution of activity

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Speaker 1: um as as as opposed to concentrations that we've seen

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Speaker 1: in the past. So your base case for this earning season,

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Speaker 1: because some people are bracing for some bad news going

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Speaker 1: into the end of the year, some negative revisions from

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Speaker 1: some big multinationals in the United States, are you're looking

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Speaker 1: for that, Cathy? Is that your expectation too? Yeah? So

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Speaker 1: you know, I think the expectations for earnings are pretty low. Um.

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Speaker 1: The real question is the guidance companies are giving and

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Speaker 1: there and we've already seen some mixed signals. Some companies

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Speaker 1: are actually guiding up a bit others, of course you're

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Speaker 1: guiding down. And that's what everyone's going to be looking for.

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Speaker 1: And again I would argue it's not going to be

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Speaker 1: as much one an industry theme as a company by

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Speaker 1: company theme. Just a final question for you, Kathy. A

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Speaker 1: lot of people have been looking at this rally between

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Speaker 1: bonds and equities and wondering when it breaks down. And

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Speaker 1: of course this can persist for a while. Bonds can perform,

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Speaker 1: fixed income can perform along with equities as well, but

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Speaker 1: at some point there could be a divergence when that

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Speaker 1: breaks a when do you think it will break? And

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Speaker 1: be how do you think it's snaps? Yeah? Um, I

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Speaker 1: can't tell about the time. UM. It seems to me

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Speaker 1: that the bond rally UM is probably the more vulnerable UM,

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Speaker 1: because if if short rates do come down, that might

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Speaker 1: give more confidence to where the economy goes longer run

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Speaker 1: and therefore longer rates could come up, so that that

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Speaker 1: would be my view of how things change. Um, but

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Speaker 1: you know there's we have to expect volatility in both

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Speaker 1: stocks and bonds given all that's going on of this.

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Speaker 1: It feels like a Friday, but it's not. It's not.

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Speaker 1: It's Wednesday, says Wednesday. Thank you so much for coming greatly,

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Speaker 1: Thank you Kath with Bernstein, John bringing her steam, Lat's

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Speaker 1: to talk about here, Yes, so much and a fantastic

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Speaker 1: ECP watcher as well. Frederick do Crosa joins us now

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Speaker 1: global strategist at Bank Pick Tae. Great to have you

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Speaker 1: with us. Frederick, your thoughts, your initial thoughts on the

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Speaker 1: changes at the top of the e CP that we

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Speaker 1: could be getting at the end of October, Well, I

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Speaker 1: think it's a net positive. We've been wondering what exactly

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Speaker 1: like Guard would be saying, thinking doing about monetary policy

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Speaker 1: because it's a surprise, to be honest. I mean remember

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Speaker 1: nine months ago she actually denied being a candidate, so

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Speaker 1: we were we had all our notes ready for your invitement.

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Speaker 1: Is just with him for another French candidate by or

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Speaker 1: even but not focused in the gut. So it's a surprise,

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Speaker 1: but I think it's about itte of surprise for many reasons,

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Speaker 1: the main one for market being continuity, and I think

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Speaker 1: she will very much continue the work preserve the credibility

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Speaker 1: and legacy of Mr Draggi, and that's absolutely essential for market. Frederica.

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Speaker 1: I think for many people that are comfortable with the

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Speaker 1: idea that it's just not YenS Viteman at the e

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Speaker 1: c B and they can keep the trades they had

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Speaker 1: on on because it will be the continuity candidate. You've

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Speaker 1: picked up on something that I think is quite important.

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Speaker 1: The core of the e CP is changing. We've lost

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Speaker 1: Peter Prey, who was the chief economist. He has been

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Speaker 1: replaced by Philip Lane, the Irishman. At the end of

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Speaker 1: the year, of course, the end of October we will

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Speaker 1: lose President Dry is set to be replaced by Madame Legarde.

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Speaker 1: But at the end of the year, at the end

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Speaker 1: of twenty nineteen is an individual that I don't think

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Speaker 1: has had enough talked about of him, Frederic, and it

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Speaker 1: is ben Wa Courey who oversees the market's portfolio at

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Speaker 1: the e c B. He's stepping down at the end

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Speaker 1: of the year. How critical will it be to at

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Speaker 1: the right replacement for ben Wakay. You're absolutely right. I

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Speaker 1: think it's even more important now that we have a

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Speaker 1: politician at the head of the CD also at the

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Speaker 1: Vice presidency. Mr Di Gindos is a politician also heading

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Speaker 1: this executive board with the President, and it's all the

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Speaker 1: more important that you have a cheap economist and a

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Speaker 1: head of market operation who are experts, so to say,

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Speaker 1: in Ciliplane is one. We'll see who replaces Carey, Okay,

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Speaker 1: Philip Lane. The giant of Trinity College is Harvard PhD.

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Speaker 1: In Benua Curay, who I ran a new years ago, folks,

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Speaker 1: is basically the wonder child of monetary academics and France. Great.

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Speaker 1: Can't Madame Leguarde, like Jerome Powell just dial one eight

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Speaker 1: hundred bank friends and talk to Benua Currey? I mean

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Speaker 1: she can. She does this. She can just bring in

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Speaker 1: a lot of good advice before critical decisions, right obviously,

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Speaker 1: and that's that's an an important point. But well, in

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Speaker 1: terms of the transition, will get most likely a decision

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Speaker 1: by the ECB in July, in September probably some easy

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Speaker 1: the stage will be set for her to continue, including

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Speaker 1: in terms of market operation. The only thing is that

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Speaker 1: it's a political decision to replace Buno Curier, probably not

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Speaker 1: by a Frenchman or woman, by an Italian. And then

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Speaker 1: that's the important part as well. It's the president's responsibility

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Speaker 1: and choice to distribute the responsibility within the Council, in

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Speaker 1: the Executive Board in particular, so she could still make

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Speaker 1: a change and make a choice in this regard depending

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Speaker 1: on who will be nominated at the board. So, Frederic,

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Speaker 1: let's talk about policy from the e CP in the

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Speaker 1: next couple of months. Most people think the e CP

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Speaker 1: will give the July meeting a pass, and we look

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Speaker 1: straight at the September when we get the economic forecast

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Speaker 1: for the depot rates negative fully basis points. How low

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Speaker 1: do you see that going. I think the past of

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Speaker 1: least resistance is to cut it again, probably in September.

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Speaker 1: You can actually signal this in July by changing the

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Speaker 1: forward guidance for allowing depositrates to go or this is

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Speaker 1: what you just discussed before. In terms of the ten

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Speaker 1: year BUN yield, this is absolutely discounted and I think

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Speaker 1: under the steps close to us by markets. So that's

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Speaker 1: the first step, but it's not the most important one.

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Speaker 1: We all agree that negative rates can only achieve very

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Speaker 1: little in terms of bringing inflation closer to the target,

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Speaker 1: and probably very little in my opinion. One argument is

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Speaker 1: to prevent uh an appreciation in the currency if the

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Speaker 1: set does cut in, perhaps even more than expected to

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Speaker 1: that one argument, but the second one is more important.

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Speaker 1: They have to prepare for the possibility of resuming asset purchase.

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Speaker 1: This is absolutely the highest importance within all the tools,

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Speaker 1: and to do this they might try and start to

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Speaker 1: consider an increase in the limit. Yeah. I say this

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Speaker 1: with your great competency and French academics and the mathem

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Speaker 1: addics that wraps around it. Uh, Frederick, and it's simple.

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Speaker 1: Is this a race to the bottom? I mean, I

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Speaker 1: guess the US And Msmester of Cleveland said, the US

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Speaker 1: is nowhere near the bottom, and come on, we're getting

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Speaker 1: there fast, and a lot of other countries aren't we.

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Speaker 1: I personally hate it. You could tell me I'm based

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Speaker 1: in Switzerland and I mean the economy is doing quite fine,

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Speaker 1: but you have negative rates of minus seventy five. Then

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Speaker 1: again you have Sweden as well. Sorry, this is incredibly important.

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Speaker 1: The Swiss twenty of your bond is plunged negative point

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Speaker 1: one eight, which is just unreal academically. Are we now

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Speaker 1: at the point where negative rates become so deep that

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Speaker 1: they truly affect the financial system? I think so. I

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Speaker 1: think so, and I think that the consensus is actually

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Speaker 1: growing within central bankers and economies working at central banks. So,

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Speaker 1: I mean, the whope the buzz atif stake on that

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Speaker 1: is that we are close to the bottom, close to

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Speaker 1: the effective lower bound that the c becuts just once

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Speaker 1: because of the said in particular, and that from there

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Speaker 1: you do something bigger, more efficient without the side effects,

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Speaker 1: which is QUE. And essentially, if QUE works, if the

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Speaker 1: economy picks up in China, in Europe and perhaps also

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Speaker 1: in the U S later on, then you'll get your

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Speaker 1: keeping in the yield curve, helping financials, hemping markets, helping

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Speaker 1: the economy at the end of the day. So the

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Speaker 1: real let's explore that. Just to wrap things up, the

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Speaker 1: effective lower bound for interest rights of the e c

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Speaker 1: B you set were close to it. How do you

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Speaker 1: come to that conclusion? I said, it's a guest. You

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Speaker 1: have a number of empirical studies. I mean, it's everyone's guests,

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Speaker 1: to be honest, But as you just said, since we

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Speaker 1: are seeing some adverse effect on the financial sector, perhaps

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Speaker 1: some imbalances in terms of the housing market and asset

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Speaker 1: prices as well. It's very likely that we are coming

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Speaker 1: closer to it. So maybe the cd we will introduce

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Speaker 1: hearing deposits or to mitigate the impact on the banking sector.

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Speaker 1: But that's nuts. I mean the addressing the core of

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Speaker 1: the problem. The care really is that you need more groules,

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Speaker 1: more inflation on the sustained basis for great to catch

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Speaker 1: up with you as a wise thank you global strategist

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Speaker 1: at Bank Pick take the first visibility of Osaka was

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Speaker 1: a president in Australia. At the end of the table

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Speaker 1: of worthies lined up was an academic from the University

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Speaker 1: of California at Irvine. His name is Peter Navarro. He

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Speaker 1: has been a lightning rod of support and criticism, those

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Speaker 1: that support the President and those that are harshly critical

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Speaker 1: of what someone suggests as a more work until his

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Speaker 1: UH policy. Dr Navarro is with the White House and

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Speaker 1: with President Trump. Peter Navarro, thank you again for joining

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Speaker 1: Bloomberg Surveillance four years ago. Five years ago, Peter, he

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Speaker 1: wrote an article China's Real Goal A Monroe doctrine in

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Speaker 1: Asia is this trade war advancing a new Asian Monroe

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Speaker 1: doctrine is China will move trade processes to Vietnam, to Malaysia,

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Speaker 1: and indeed to South Korea. Tom, I'm not sure if

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Speaker 1: that's the case. What I do know coming back from

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Speaker 1: the G twenty is that President Trump demonstrated UH skills

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Speaker 1: that will arguably make him the best foreign policy president

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Speaker 1: since Reagan. UH. You you're right to lead with the

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Speaker 1: Australian breakfast we had, it was a dinner, UH. Great

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Speaker 1: meeting with the Assees, but great meetings with the Turks,

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Speaker 1: great meetings with the Germans. UM. It's really interesting over

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Speaker 1: the last two and a half years how the President

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Speaker 1: has grown into the role of world leader with the

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Speaker 1: trust UH of these UH leaders around the world. Very

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Speaker 1: interesting behind closed doors, how we can talk to these

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Speaker 1: folks and get stuff done for the American people behind

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Speaker 1: you get stuff done for the American people behind closed doors,

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Speaker 1: behind open doors. If we close the door to a

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Speaker 1: multilateral or indeed a bilateral approach. Now, look with China,

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Speaker 1: you you you lead kind of with a salacious way

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Speaker 1: of going about this from an economic point of view. Look, look,

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Speaker 1: here's what happened with President she and President Trump close

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Speaker 1: friendship agreement to go and restart negotiations. Umbassador Robert Lightheiser,

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Speaker 1: You're gonna go um and have face to face talks

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Speaker 1: with Leo Huh, who's the reformer on the Chinese side,

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Speaker 1: And we're gonna work through the structural issues. Not a

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Speaker 1: trade war, it's a trade dispute. We're gonna work through

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Speaker 1: the structural issues in a way which is going to

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Speaker 1: make the American economy and the global economy uh stronger

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Speaker 1: over time. Tom, I think you'd be the first to

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Speaker 1: agree that we can't live in a world where one

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Speaker 1: of the biggest economies in the world steals people's intellectual property.

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Speaker 1: And well, that has been identified by all on both sides.

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Speaker 1: Let me bring in my colleague Dr Farroh Pace. Most

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Speaker 1: people would agree with that statement. The last one you

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Speaker 1: made interesting for you to mention they face to face mateens.

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Speaker 1: Can you just give us an idea as to when

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Speaker 1: that's going to happen soon? Yeah? They I was talking

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Speaker 1: uh with folks yesterday over the West Wing. Those plans

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Speaker 1: are in process and they will be done expeditiously. We

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Speaker 1: like to move and what we call Trump time. UH,

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Speaker 1: we don't waste time. On the other hand, the President

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Speaker 1: is right and saying that we want to get this right.

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Speaker 1: Please understand that this Chinese US agreement is far more

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Speaker 1: complex than anything that's ever been negotiated, including the US

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Speaker 1: Mexico Canada agreement, which is the most sophisticated and smartest

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Speaker 1: and vegas deal we have ever negotiated. There's simply a

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Speaker 1: lot of moving parts to this. So let's get it

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Speaker 1: right in the in the shorter run, over the next

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Speaker 1: couple of months, because I know you folks, our investor oriented,

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Speaker 1: which is what it's all about. The two things that

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Speaker 1: are important are getting the US Mexico Canada Agreement passed

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Speaker 1: and getting the Fed UH to lower interest rates. So

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Speaker 1: the U S m c A is worth over a

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Speaker 1: point of GDP growth, about half a million jobs, seventy

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Speaker 1: five thousand jobs in the auto sector. It's also modernizes

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Speaker 1: the digital economy. UM does good things for services and

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Speaker 1: intellectual property UH in a way which which plays to

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Speaker 1: the comparative advantages of the United States. So that would

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Speaker 1: be a tremendous boon. I think if we get either

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Speaker 1: or both of those things over the next several months,

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Speaker 1: we get over thirty thousand on the dow. Uh, that's

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Speaker 1: gonna be the next market move. In the meantime, we're

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Speaker 1: gonna have honest, good faith, candid negotiations with the Chinese side,

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Speaker 1: working through the structural problems and uh, trying to get

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Speaker 1: get to a yes. And we've got a price target

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Speaker 1: from the White House that's home on the down. Pete Navarro, well,

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Speaker 1: I yeah, I had. I do have some credibility here.

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Speaker 1: The day after the election, here we go. Hang on

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Speaker 1: you you can write this down. You can actually see

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Speaker 1: the clip. I was on another network. I won't let

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Speaker 1: another network. Yes, but the futures were about as red

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Speaker 1: as they ever get down. I got on before the

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Speaker 1: market open and said that on the tax cuts, deregulation,

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Speaker 1: cheaper energy and a more level playing field, we would

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Speaker 1: at a time when you can bank here, bank you.

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Speaker 1: Dr Navarro, thank you so much. Now my book of

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Speaker 1: the year, it is the British are coming. It is

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Speaker 1: Rick Atkinson. We all know him. We know him from

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Speaker 1: three volumes of World War two Brilliance. I had the

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Speaker 1: honor of interviewing him on a normandy day, one of

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Speaker 1: those days where politicians show up and go through the motions,

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Speaker 1: and yet Rick Atkinson knows every single moment within his

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Speaker 1: research of World War Two and now brings that treatment

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Speaker 1: to an extraordinary first effort on the American Revolution. Rick Atinson,

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Speaker 1: we got about eight ways to go here. I do

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Speaker 1: want to talk to you about how you manufacture the

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Speaker 1: product on your place in literature. Will do that later.

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Speaker 1: You have a seen a third of the way through

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Speaker 1: the book, which I mean, I've read everything. Uh, Gordon

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Speaker 1: Brown's done on Ben Franklin. You've got Franklin. It's seventy

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Speaker 1: going north up the Hudson, up there's Lake Champlain and

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Speaker 1: tell me, folks, there's no uber. And then he goes

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Speaker 1: to north up to the St. Lawrence River and ends

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Speaker 1: up in Montreal, Quebec. I was stunned at that visceral

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Speaker 1: cold freezing evidence. Did Ben Franklin almost die on that trip? Well? First,

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Speaker 1: good morning guys, thanks for having me. Yes, he Um,

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Speaker 1: he suffered. Um he was seven years old, which of

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Speaker 1: course is ancient in seventeen seventy five. And um he

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Speaker 1: did not travel well generally, although he traveled a lot

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Speaker 1: across the Atlantic Ocean. Seven or eight times in his life.

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Speaker 1: He suffered from from boils from skin conditions generally, um,

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Speaker 1: the discomfort of following that route that you just described.

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Speaker 1: It is hard for us to imagine today. But he

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Speaker 1: writes to friends at one point in that journey that

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Speaker 1: he thinks maybe he's bitten off more than he can chew,

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Speaker 1: and that he basically writes farewell letters. Well, he doesn't die,

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Speaker 1: of course, he makes it to Montreal. His task is

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Speaker 1: to try to salvage what has become a catastrophic American

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Speaker 1: invasion of Canada in an effort to win the Canadians

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Speaker 1: over to our side as the fourteenth Colony. He fails

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Speaker 1: in that, but he makes a good effort at it.

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Speaker 1: What's so important here, Rick, and this goes to your

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Speaker 1: extraordinary research on you Brook as you bring it alive,

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Speaker 1: is Ellis said in The New York Times. It's as

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Speaker 1: if ken Burns somehow gained access to a time machine.

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Speaker 1: What was the biggest surprise is you tackled this? I mean,

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Speaker 1: this is not World War two X number of years later.

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Speaker 1: This is ancient history. What was the biggest surprise in

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Speaker 1: this one volume and the volumes to come. I think

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Speaker 1: the biggest surprise for me is the British point of

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Speaker 1: view and I deliberately set out to try to tell

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Speaker 1: this story, our creation story, from both the American perspective

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Speaker 1: and the British perspective. And so I spent, for example,

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Speaker 1: a lot of time at Windsor Castle, just west of London,

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Speaker 1: because that's where the papers of our last king, or

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Speaker 1: Georgia Third, they're kept in the garret of the round Tower,

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Speaker 1: begun by William the Conqueror in the eleventh century. And uh,

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Speaker 1: trying to understand, first of all, why the British would

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Speaker 1: wage war for eight years across three thousand miles of

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Speaker 1: open ocean in the age of Sail was something that

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Speaker 1: beguiled me. And trying to understand the strategic misconceptions that

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Speaker 1: George and his ministers had about the Americans and about

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Speaker 1: the war was something that I just find endlessly uh

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Speaker 1: perplexing and fast. For example, George is absolutely convinced that

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Speaker 1: if the American insurrection is permitted to succeed, that Canada, Ireland,

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Speaker 1: the Sugar Islands in the West Indies, India, they will

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Speaker 1: all flare up in insurrection and it will be the

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Speaker 1: end of the British Empire, which at that point is

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Speaker 1: newly created as a consequence of their victory in the

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Speaker 1: Seven Years War in seventeen sixty three. That's quite wrong.

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Speaker 1: It's the Domino theory, it's it's it's an eighteenth century

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Speaker 1: version of why we got into Vietnam. That's wrong. And

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Speaker 1: so understanding that, understanding their misunderstandings, I think is the

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Speaker 1: thing that most beguiled me. I can't say enough about this, folks,

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Speaker 1: and just Horace wallpolling the rest of the British battling

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Speaker 1: with the king and those around him as extraordinary. I

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Speaker 1: want to do a day to check here Green on

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Speaker 1: the screen. The dial up sixty yields one point. As

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Speaker 1: we celebrate without question, my book of the year, The

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Speaker 1: British are coming in as the first volume from Rick Atkinson.

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Speaker 1: You know him from his extraordinary award winning effort a

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Speaker 1: World War Two. Rick, let me bring in my colleague

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Speaker 1: Paul Sweeney. Rick, I'm so happy that you wrote this book,

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Speaker 1: and it's part of American history. I grew up in

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Speaker 1: Trenton and Washington's Crossing, New Jersey, so I literally grew

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Speaker 1: up with this history. Uh. And we you know, every

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Speaker 1: Christmas Day we go to Washington Crossing and see Washington

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Speaker 1: cross the Delaware. They recreate that really nicely. So put

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Speaker 1: into context those early months of the Revolutionary War, the

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Speaker 1: Battle of Trenton, Battle of Princeton, How important, how critical

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Speaker 1: were they to that period. Well, it's absolutely vital that

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Speaker 1: at this point, when we're talking about the Christmas time

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Speaker 1: seventeen seventy six, the American cause really looks like it's

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Speaker 1: on its last legs. Washington rights to his brother, I

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Speaker 1: think the game is pretty near up. Uh, he's down

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Speaker 1: to a fewer than three thousand men in the American Army.

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Speaker 1: This is in a country of two and a half

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Speaker 1: million people. He's fighting the greatest military in the world.

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Speaker 1: The British Army is big and powerful. They have the

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Speaker 1: greatest navy the world has ever seen. And um, he's

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Speaker 1: not had great success. He's been evicted from New York

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Speaker 1: and a bloody battle on Long Island. He's not showed

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Speaker 1: that he has the competence to be the commanding general

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Speaker 1: of this cause. And so by the time we get

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Speaker 1: to to Trenton and then to Princeton, as Washington rights

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Speaker 1: to Congress, desperate times required desperate measures, and he's desk

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Speaker 1: Rick very quickly, and we'll come back and do more

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Speaker 1: with you there's a hooden sculpture of George Washington at

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Speaker 1: Mount Vernon, which people say is the only thing that

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Speaker 1: really looked like him. Do you know who George Washington is?

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Speaker 1: After all your prodigious research, you know there's a there's

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Speaker 1: a paid quality to him. He did not allow people

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Speaker 1: into his inner life very readily. He did not have

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Speaker 1: a lot of close friends. Martha's probably his closest confidant.

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Speaker 1: I think I've got a pretty good fix on him, though.

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Speaker 1: I've spent fifteen years with Dwight Eisenhower metaphorically, and I

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Speaker 1: think I understand him pretty well as a general. I've

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Speaker 1: spent six with George Washington so far, and I'm getting there.

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Speaker 1: I think I've got a much better understanding of him

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Speaker 1: certainly than when I started, and I see the complexities

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Speaker 1: and the contradictions in him. I admire him as I

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Speaker 1: admire Eisenhower more every day that I am privileged to

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Speaker 1: spend with him. Rick, how many more volumes will there be?

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Speaker 1: My plan is for there'll be two more. Tom. I

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Speaker 1: stopped this one as we were just discussing with the

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Speaker 1: victories at Trenton Princeton, and the second one will pick

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Speaker 1: up shortly after that in seventeen seventy seven, and uh

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Speaker 1: probably take it to the catastrophic defeat for the Americans

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Speaker 1: at Charleston in seventeen eighty. That's where I'll end volume two,

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Speaker 1: and then volume three will take us through Yorktown in

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Speaker 1: the in the end of the war, and then you've

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Speaker 1: got Napoleon after that seven volumes. Rick and Paul Swedian

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Speaker 1: time came with Rick Atkinson. Were just honored to have

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Speaker 1: him on here, particularly before our day of independence. There

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Speaker 1: is a scene Rick Atkinson but Laura Lenny, the acclaimed

429
00:25:39,640 --> 00:25:43,359
Speaker 1: actress in the TV mini series John Adams, where the

430
00:25:43,440 --> 00:25:46,520
Speaker 1: carrot pulls up to the house and they show the

431
00:25:46,600 --> 00:25:49,800
Speaker 1: pustular kid with small pox and she goes out to

432
00:25:49,880 --> 00:25:52,840
Speaker 1: the card she gets a thing and she inoculates one

433
00:25:52,880 --> 00:25:57,360
Speaker 1: of the young Adams kids against smallpox. The first hundred

434
00:25:57,359 --> 00:26:03,119
Speaker 1: pages year Book is a medical reads on Boston and smallpox.

435
00:26:03,680 --> 00:26:08,520
Speaker 1: How that was a dominant theme of the colonies, wasn't

436
00:26:08,560 --> 00:26:14,560
Speaker 1: it well, smallpox, typhus, dysentery, you name at smallpox was

437
00:26:14,600 --> 00:26:17,199
Speaker 1: particularly awful, was known as the King of Terrors, and

438
00:26:17,200 --> 00:26:19,720
Speaker 1: it killed a hundred thousand people in North America between

439
00:26:19,760 --> 00:26:24,400
Speaker 1: seventeen seventy five and seventeen eighty two, there was no

440
00:26:24,600 --> 00:26:29,160
Speaker 1: immunization against it that would come later in the century. Uh.

441
00:26:29,280 --> 00:26:34,560
Speaker 1: There was a kind of crude, homemade version of inoculation

442
00:26:34,600 --> 00:26:39,080
Speaker 1: where you would take a needle or straw and dip

443
00:26:39,160 --> 00:26:43,600
Speaker 1: it into an active smallpox pustule and then swab it

444
00:26:43,840 --> 00:26:46,800
Speaker 1: into UH an incision you'd made on your leg or

445
00:26:46,840 --> 00:26:50,679
Speaker 1: your arm, and that provided some protection against it. You

446
00:26:50,720 --> 00:26:55,399
Speaker 1: got sick, but usually not fatally sick. Unfortunately, while you

447
00:26:55,480 --> 00:27:00,000
Speaker 1: were um doing this procedure to yourself, you were infectious,

448
00:27:00,000 --> 00:27:01,840
Speaker 1: and you could spread it to other people in your

449
00:27:01,880 --> 00:27:06,560
Speaker 1: family or your army company or whatever. So it was

450
00:27:06,600 --> 00:27:12,200
Speaker 1: a terrible disease. Washington had had smallpox, relatively light case

451
00:27:12,240 --> 00:27:16,160
Speaker 1: of it when he was a young man, contracted in Barbados,

452
00:27:16,320 --> 00:27:19,960
Speaker 1: is only trip out of America. And the best thing

453
00:27:20,000 --> 00:27:24,600
Speaker 1: about it is it made you invulnerable to smallpox thereafter.

454
00:27:24,720 --> 00:27:29,639
Speaker 1: So the soldiers who had had smallpox were highly desired.

455
00:27:29,680 --> 00:27:33,280
Speaker 1: They were really prized because they were immune to future

456
00:27:33,320 --> 00:27:37,199
Speaker 1: smallpox attacks. So Rick, when when the British sent their

457
00:27:37,200 --> 00:27:40,919
Speaker 1: fleet across the Atlantic, how confident were they that they

458
00:27:40,960 --> 00:27:44,320
Speaker 1: would win the day? You know, in seventeen seventy five.

459
00:27:44,320 --> 00:27:46,320
Speaker 1: When the war begins, they think that it's going to

460
00:27:46,440 --> 00:27:50,800
Speaker 1: be quick and easy. Um. Most of them think that

461
00:27:50,840 --> 00:27:53,520
Speaker 1: there are some who recognize it. First of all, waging

462
00:27:53,680 --> 00:27:56,600
Speaker 1: war three thousand miles of open ocean the age of

463
00:27:56,640 --> 00:27:59,399
Speaker 1: sail is never going to be as easy as you

464
00:27:59,480 --> 00:28:03,959
Speaker 1: might hope. But most of them, including the King and

465
00:28:04,119 --> 00:28:08,600
Speaker 1: his ministers, believed that there was no way that this

466
00:28:08,880 --> 00:28:11,720
Speaker 1: rabble in America was going to be able to stand

467
00:28:11,800 --> 00:28:15,480
Speaker 1: up to the substantial military force that was being sent,

468
00:28:15,880 --> 00:28:18,960
Speaker 1: which included, by the way, not only the British Army

469
00:28:18,960 --> 00:28:24,120
Speaker 1: and the Royal Navy, but thirty thousand German mercenaries. The Hessians.

470
00:28:24,160 --> 00:28:30,440
Speaker 1: They were from uh, seven small German principalities. Hessa provided

471
00:28:30,480 --> 00:28:33,720
Speaker 1: most of them, so we called them all Hessians. Uh.

472
00:28:33,760 --> 00:28:36,080
Speaker 1: And there was a belief that there was no way

473
00:28:36,119 --> 00:28:40,640
Speaker 1: that the Americans could stand up against this kind of coercion, this,

474
00:28:40,640 --> 00:28:45,360
Speaker 1: this this bloody military coersion. UM. It didn't take long

475
00:28:45,480 --> 00:28:51,440
Speaker 1: for that pipe dream to dissipate. It was small uh.

476
00:28:51,520 --> 00:28:56,480
Speaker 1: Bunker Hill, June seventeen, seventeen seventy five A thousand British

477
00:28:56,520 --> 00:29:00,560
Speaker 1: casualties in four hours at Bunker Hill two fifty six

478
00:29:00,600 --> 00:29:05,400
Speaker 1: British dead, and when the word reached London, people began

479
00:29:05,440 --> 00:29:08,600
Speaker 1: to think this might might not be as easy as

480
00:29:08,640 --> 00:29:10,880
Speaker 1: we had hoped. Rick, I want to get into the

481
00:29:10,960 --> 00:29:14,080
Speaker 1: style that you have made acclaimed, an award winning, and

482
00:29:14,360 --> 00:29:17,840
Speaker 1: I'll be blunt. Folks. The World War Two novel books novels,

483
00:29:17,840 --> 00:29:20,440
Speaker 1: they feel like a novel, even though it's not. It's history.

484
00:29:20,880 --> 00:29:22,760
Speaker 1: You can read about ten or twelve pages and then

485
00:29:22,800 --> 00:29:24,920
Speaker 1: you have to put the book down. The way Mr

486
00:29:24,960 --> 00:29:28,840
Speaker 1: Atkinson writes so intensely, I think of Eric Larabie and

487
00:29:29,000 --> 00:29:32,680
Speaker 1: his one volume Commander in Chief on FDR, where what

488
00:29:32,800 --> 00:29:35,440
Speaker 1: you do and Larabie does is you go back and

489
00:29:35,520 --> 00:29:38,760
Speaker 1: you open us up to all the historians before you,

490
00:29:39,440 --> 00:29:43,560
Speaker 1: and then you cite those historians along the way, give

491
00:29:43,640 --> 00:29:47,640
Speaker 1: us the historian that our listeners should read when they're

492
00:29:47,640 --> 00:29:51,600
Speaker 1: done reading. Rick Atkinson m hmm. Well, first of all,

493
00:29:51,680 --> 00:29:55,640
Speaker 1: Larrabie is a is a really wonderful book. Um probably

494
00:29:55,680 --> 00:30:00,400
Speaker 1: the best single volume book on the American Revolution, uh

495
00:30:00,640 --> 00:30:05,800
Speaker 1: by Robert Middelkoff. I think he's emeritus now at UC Berkeley.

496
00:30:05,840 --> 00:30:09,280
Speaker 1: It's called The Glorious Cause. It covers the whole period

497
00:30:09,280 --> 00:30:11,440
Speaker 1: from seventeen sixty three, the end of the French and

498
00:30:11,480 --> 00:30:15,280
Speaker 1: Indian War to seventeen eighty nine, the beginning of the Republic.

499
00:30:15,360 --> 00:30:19,120
Speaker 1: Really uh, and it's a doorstop. It's a big, old

500
00:30:19,120 --> 00:30:22,600
Speaker 1: fat book, but it's very well done. He's he's an academic,

501
00:30:22,680 --> 00:30:25,480
Speaker 1: but he writes with grace um so I think that

502
00:30:25,480 --> 00:30:30,040
Speaker 1: that is a book that I can without reservation indors.

503
00:30:31,480 --> 00:30:34,440
Speaker 1: So Rick, just you know, with your work, what do

504
00:30:34,440 --> 00:30:38,920
Speaker 1: you think the greatest miscalculation the British made as they

505
00:30:38,960 --> 00:30:44,040
Speaker 1: sent their fleet over Paul. I think easily the biggest

506
00:30:44,200 --> 00:30:48,280
Speaker 1: strategic error that they've committed, beside the one that I

507
00:30:48,320 --> 00:30:51,560
Speaker 1: mentioned earlier, in believing that other insurrections will come out

508
00:30:51,560 --> 00:30:56,080
Speaker 1: of this American insurrection, is the premise that a majority

509
00:30:56,240 --> 00:30:59,800
Speaker 1: of Americans, a majority of the two million white Americans

510
00:30:59,840 --> 00:31:04,320
Speaker 1: the also five hundred thousand black slaves, were loyal to

511
00:31:04,360 --> 00:31:08,880
Speaker 1: the Crown. They believed that there was a a large

512
00:31:09,080 --> 00:31:17,280
Speaker 1: residual loyalty from Georgia to New Hampshire that awaited only

513
00:31:17,720 --> 00:31:22,280
Speaker 1: an opportunity to express itself, that when the British Army

514
00:31:22,280 --> 00:31:29,160
Speaker 1: and Navy arrived, that this large, silent majority of loyalists

515
00:31:29,280 --> 00:31:34,720
Speaker 1: would emerge and help to support the counter insurrection. That's

516
00:31:34,840 --> 00:31:41,680
Speaker 1: quite wrong. Uh. Modern scholarship has showed that maybe of

517
00:31:41,960 --> 00:31:45,000
Speaker 1: those two million white Americans were loyalists. And of course

518
00:31:45,120 --> 00:31:49,720
Speaker 1: loyalty is a shifting concept. It depends on circumstances, and

519
00:31:50,440 --> 00:31:52,600
Speaker 1: you might be loyal one day and less loyal the

520
00:31:52,720 --> 00:31:57,880
Speaker 1: next day. After that British Army leaves your backyard. So um,

521
00:31:57,920 --> 00:32:02,760
Speaker 1: they predicated their war stragergy on that false assumption. They

522
00:32:02,880 --> 00:32:06,360
Speaker 1: clung to it for years, um, and it really turned

523
00:32:06,360 --> 00:32:09,760
Speaker 1: around to to to bite them. We've got to leave

524
00:32:09,800 --> 00:32:11,600
Speaker 1: it there. We have just simply run out of time.

525
00:32:11,680 --> 00:32:14,800
Speaker 1: Rick Atkinson, with this, folks, I can't say enough about

526
00:32:14,880 --> 00:32:18,000
Speaker 1: the joy of having on this day before Independence Day,

527
00:32:18,400 --> 00:32:21,320
Speaker 1: and also the joy of the British are coming the

528
00:32:21,400 --> 00:32:25,440
Speaker 1: first of many volumes on the Revolutionary or Rick Atkinson,

529
00:32:25,520 --> 00:32:28,280
Speaker 1: Thank you so much, is without question my book of

530
00:32:28,280 --> 00:32:31,960
Speaker 1: the year. Thanks for listening to the Bloomberg Surveillance podcast.

531
00:32:32,320 --> 00:32:37,240
Speaker 1: Subscribe and listen to interviews on Apple Podcasts, SoundCloud, or

532
00:32:37,400 --> 00:32:41,720
Speaker 1: whichever podcast platform you prefer. I'm on Twitter at Tom

533
00:32:41,800 --> 00:32:45,680
Speaker 1: Keene before the podcast. You can always catch us worldwide.

534
00:32:46,160 --> 00:33:00,400
Speaker 1: I'm Bloomberg RADIOWO