WEBVTT - There Is Resistance to Debt Relief, Papaconstantinou Says 0:00:00.120 --> 0:00:02.920 Brought you by Bank of America, Mary Lynch. Investing in 0:00:03.000 --> 0:00:07.840 local communities, economies and a sustainable future. That's a power 0:00:08.080 --> 0:00:12.360 of global connections, Mary Lynch, Pierce Fenner and Smith Incorporated 0:00:12.760 --> 0:00:26.400 Member s I p C. Welcome to the Bloomberg Surveillance Podcast. 0:00:26.440 --> 0:00:29.920 I'm Tom Keene with David Gura. Daily we bring you 0:00:29.960 --> 0:00:34.800 insight from the best of economics, finance, investment, and international relations. 0:00:35.240 --> 0:00:40.760 Find Bloomberg Surveillance on Apple Podcasts, SoundCloud, Bloomberg dot Com, 0:00:40.800 --> 0:00:47.519 and of course, on the Bloomberg David Gura in New 0:00:47.560 --> 0:00:50.320 York with Tom Keen. This is Bloomberg Surveillance on Bloomberg Radio. 0:00:50.320 --> 0:00:51.920 A couple of years back, I was on a reporting 0:00:51.920 --> 0:00:54.880 trip to Athens. There was a protest on my final 0:00:55.040 --> 0:00:58.240 night there. Parliament was debating. Crowds gathered in Syntagma Square 0:00:58.240 --> 0:01:00.640 and towards the end of you homemade game selin bombs 0:01:00.720 --> 0:01:03.240 were thrown. I gather the same thing played out last 0:01:03.320 --> 0:01:07.679 night in Athens as parliamentarians debated another round of austerity measures. 0:01:07.720 --> 0:01:09.400 Quite pleasure to have with us here on Bloomberg eleven 0:01:09.400 --> 0:01:12.120 three our studios. George Papa Constantino, the former Finance minister 0:01:12.760 --> 0:01:14.840 of Greece. Get us up to speed on what's going 0:01:14.840 --> 0:01:16.920 on here. We're looking at the Eurogroup meeting I gather 0:01:17.040 --> 0:01:20.680 today or tomorrow this week in which the next round 0:01:20.680 --> 0:01:22.560 of this is going to be discussed in more detail. 0:01:22.800 --> 0:01:25.040 Where do things stand with the Greek economy at this point? 0:01:25.319 --> 0:01:28.600 Good morning, Yeah, we are up to for another Eurogroup 0:01:28.640 --> 0:01:33.280 meeting and it will basically conclude that the conditions are 0:01:33.280 --> 0:01:36.840 there to to disperse the loans for Greece. This is 0:01:36.880 --> 0:01:41.080 following passing in legislation this week with all the necessary measures, 0:01:41.080 --> 0:01:44.680 the fiscal measures. So what remains and the next step, 0:01:44.720 --> 0:01:48.280 and the interesting step, so to speak, is the discussions 0:01:48.600 --> 0:01:52.200 uh within the meeting and also outside between the I 0:01:52.320 --> 0:01:56.000 m F and Germany on that relief, because everyone recognizes 0:01:56.080 --> 0:01:58.040 that you need some that relief for Greece to be 0:01:58.080 --> 0:02:03.160 able to grow basically and clear the clearly the sky 0:02:03.240 --> 0:02:05.560 a little bit for for as you move forward. So 0:02:07.200 --> 0:02:10.320 the conditions for that relief are going to be discussed. 0:02:10.360 --> 0:02:13.440 It's clear that there will be no decisions for immediate 0:02:13.480 --> 0:02:18.120 implement implementing for immediately implementing that relief, but the parameters 0:02:18.160 --> 0:02:21.080 will be said to have that relief after this program 0:02:21.080 --> 0:02:25.280 finishes in the summer of two. Once that's done, that's 0:02:25.320 --> 0:02:28.040 the trigger for the ECB too then include Greece into 0:02:28.160 --> 0:02:30.880 its quantit visa program and for Greece to then go 0:02:30.960 --> 0:02:33.440 back into the markets for the first time since two 0:02:33.480 --> 0:02:38.280 thousand fourteen and start a process of normalization which will 0:02:38.360 --> 0:02:40.720 allow it to not be completely out of the woods, 0:02:40.760 --> 0:02:43.919 but at least you know, spreads will tighten and and 0:02:44.520 --> 0:02:48.520 after the program finishes, we can have a some light 0:02:48.600 --> 0:02:51.480 follow up arrangement like a credit line, so to speak. 0:02:51.560 --> 0:02:54.760 But start finding yourself on the market again. We understand 0:02:54.760 --> 0:02:57.120 that your sense of the sustainability of what the your 0:02:57.120 --> 0:03:00.160 group president proposed this morning, a primary surplus of three 0:03:00.160 --> 0:03:02.440 point five percent for for five years, is that something 0:03:02.440 --> 0:03:06.079 that you think is sustainable? Look, it's can we do 0:03:06.400 --> 0:03:08.520 promise of troup and five, Yes we can. Is it 0:03:08.560 --> 0:03:11.240 a good idea? No, it's not. I think they're the 0:03:11.280 --> 0:03:14.200 aim if is right, it's too high. The only reason 0:03:14.240 --> 0:03:19.080 why it is there is because it reduces the need 0:03:19.280 --> 0:03:24.160 for deeper debt relief and therefore makes Germany happy. At 0:03:24.240 --> 0:03:29.160 least your own dine Symplome is not proposing the original idea, 0:03:29.240 --> 0:03:33.400 which was ten years of three Maybe the minister can 0:03:33.440 --> 0:03:36.080 help us, David, you went to Athens here recently? Is 0:03:36.120 --> 0:03:39.400 it Hydra or h H y d r A. It's 0:03:39.480 --> 0:03:42.160 h Hydra. That's right, David. We need to do a 0:03:42.240 --> 0:03:45.760 remote with the Finance minister from here happy that was 0:03:46.000 --> 0:03:48.920 Sophia or rendered that movie a million years ago. It's 0:03:48.960 --> 0:03:53.120 like it's like it's like beyond gorgeous, is what I 0:03:53.920 --> 0:03:56.120 You were with the London School of Economics. Paul Degar 0:03:56.200 --> 0:03:57.839 is there right now and he agrees with you. There 0:03:57.920 --> 0:04:01.200 must be a debt workout. Why do the elites of 0:04:01.320 --> 0:04:04.320 central core Europe don't want to do what you want 0:04:04.360 --> 0:04:07.080 to do and what politic War wants to do because 0:04:07.080 --> 0:04:10.040 it's called politics, because it isn't just they don't want 0:04:10.040 --> 0:04:12.680 to open up their wallet. Well, it's a communisturation out, 0:04:12.800 --> 0:04:14.880 it's a combination of things. I think there's there's a 0:04:15.000 --> 0:04:19.960 deep seated kind of resistance to UH to dead relief 0:04:20.040 --> 0:04:25.039 because it's hard to sell to the their local constituencies 0:04:25.080 --> 0:04:28.280 and taxpayers. It's clear, but when we're talking dead relief, 0:04:28.320 --> 0:04:30.839 we're not on nominal haircuts because this is this is 0:04:30.880 --> 0:04:34.719 money lent by the official sector now and so you 0:04:34.760 --> 0:04:37.400 can't tell the taxpayer. Well, you know, sorry, we told 0:04:37.400 --> 0:04:39.440 you're gonna we're lending grace, but we're gonna get the 0:04:39.480 --> 0:04:42.039 money back. You know, I guess what we're not. It 0:04:42.160 --> 0:04:47.520 will be extending the maturities longer, gray spirits and hopefully 0:04:47.520 --> 0:04:51.919 also locking in lower rates. So that part is that, 0:04:52.000 --> 0:04:54.400 and part is that they're not trusting the Greek political 0:04:55.000 --> 0:04:58.120 elite in the Greek political system, and that's why any 0:04:58.200 --> 0:04:59.839 kind of dead relief is going to go hand in 0:05:00.000 --> 0:05:05.520 and with conditionality, with an assistance that Greece continues through 0:05:05.520 --> 0:05:08.240 the structure of films for some time. That's the time 0:05:08.279 --> 0:05:10.039 we have. Thank thank you so much for coming. We 0:05:10.040 --> 0:05:12.080 could go on and please don't be a stranger to 0:05:12.160 --> 0:05:14.120 that remote we're gonna, we're gonna get to the island. 0:05:14.720 --> 0:05:16.839 Thank you very much. David, give us Audi here and 0:05:16.839 --> 0:05:19.159 I need to do a data checker. Unfortunately, we're pleasure 0:05:19.160 --> 0:05:21.359 of George pop Constantina with us the former finance Minister 0:05:21.400 --> 0:05:24.200 of Greece, Joan Bloomberg eleven three oh studios here in 0:05:24.200 --> 0:05:27.880 New York today. Decisively, the curve is flattened below where 0:05:27.880 --> 0:05:29.920 we were in November eighth. We have had a full 0:05:29.960 --> 0:05:33.479 circle on the November eighth Trump trade if you will 0:05:33.560 --> 0:05:36.240 for the president, not all because of the president, but 0:05:36.640 --> 0:05:40.040 we had a steeper yield curve enthusiasm about fiscal policy 0:05:40.680 --> 0:05:43.679 in at nineties six basis points. We are decisively below 0:05:43.680 --> 0:05:47.560 where we were the evening of that election. Worldwide, this 0:05:47.720 --> 0:06:02.960 is Bloomberg Chris Kasanti with us who wants like next 0:06:02.960 --> 0:06:05.600 to no stocks, He's like, really a focus port folio 0:06:05.760 --> 0:06:08.760 is alphabet? Is I hate to call it? Is alphabet 0:06:08.839 --> 0:06:11.760 part of your your wisdom? It is not, Tom, although 0:06:11.760 --> 0:06:14.320 Apple is Apple is one of our largest positions, mostly 0:06:14.320 --> 0:06:16.160 because it's gone upset. How do you do that? This 0:06:16.200 --> 0:06:18.160 is you know we're coming up on the sea if 0:06:18.320 --> 0:06:21.880 exam so we get a little wonky in the in 0:06:21.920 --> 0:06:23.839 the June Chris Krossani, what do you do when you 0:06:23.880 --> 0:06:26.279 go in with a three or four percent position and 0:06:26.400 --> 0:06:30.560 heaven forbid your successful and it becomes a seven percent position? 0:06:30.960 --> 0:06:32.560 What do you do? Is small? For us, Tom, I 0:06:32.600 --> 0:06:34.800 mean our average position size is five or six percent, 0:06:34.920 --> 0:06:38.359 So you percent Tom, so we won't go over to 0:06:38.400 --> 0:06:41.440 double digits. But for Apple it made sense value wise. 0:06:41.520 --> 0:06:45.000 It was ex cash nine months ago, now less than 0:06:45.040 --> 0:06:48.159 ten times earnings. It checked all the boxes. So what 0:06:48.200 --> 0:06:50.159 do you do with the funds? Just just sell Apple? 0:06:50.160 --> 0:06:53.320 When you get up to ten percent coverage, do you say, Hey, 0:06:53.360 --> 0:06:55.960 that worked out, Let's find something the same. How do 0:06:56.040 --> 0:06:59.320 you find the next value the next Apple? Well, when 0:06:59.360 --> 0:07:01.880 you have the luxure of only owning eighteen stocks and 0:07:01.880 --> 0:07:05.080 you're only buying four or five a year, um, it's 0:07:05.160 --> 0:07:07.400 it's really a one off. We're not saying, oh, let's 0:07:07.400 --> 0:07:09.000 go into this field, let's go into that. We we're 0:07:09.000 --> 0:07:11.760 looking at the numbers are each individual company. So that's 0:07:11.920 --> 0:07:14.840 a real luxury in our clients are not expecting quarter 0:07:14.880 --> 0:07:17.000 by quarter results to beat the SMP. But over a 0:07:17.000 --> 0:07:18.679 long period of time, we had a lot of value. 0:07:18.880 --> 0:07:21.960 Give us a sense of of what you think happened yesterday. Yes, 0:07:22.040 --> 0:07:25.960 the story continues to evolve and undulate, but we've had 0:07:25.960 --> 0:07:28.119 a lot of uncertainty and a lot of these stories 0:07:28.120 --> 0:07:30.280 pop up over the last hundred plus days. What was 0:07:30.280 --> 0:07:32.840 it about yesterday that that spooked the market? No, no, no, 0:07:32.880 --> 0:07:34.920 I think it's a uh, David, I think it's a 0:07:34.960 --> 0:07:37.840 significant event because for the first time since the election, 0:07:37.880 --> 0:07:40.200 after all these crazy things from the White House, we 0:07:40.320 --> 0:07:42.800 finally got something that bled over into the market. Now 0:07:43.000 --> 0:07:45.560 is it a seminal event. I don't think so. So 0:07:45.680 --> 0:07:49.600 everyone's talking impeachment. Everybody's talking the president is mortally wounded. 0:07:49.840 --> 0:07:52.600 We don't believe that's true. The Republicans still control both 0:07:52.600 --> 0:07:55.840 houses of Congress. The president still has enormous leverage under 0:07:55.840 --> 0:08:00.000 our political system. Once we stop talking about independent Council 0:08:00.080 --> 0:08:03.640 for a moment and then start talking again about regulatory reform, 0:08:03.720 --> 0:08:06.840 tax reform, I think you'll see the market start to rebound. 0:08:07.080 --> 0:08:09.280 I don't think. I think this is a blip, not 0:08:09.480 --> 0:08:12.880 a reversal. How much do you allow yourself as an 0:08:12.880 --> 0:08:15.600 investor to be swayed by sentiment? It seems like yesterday was, 0:08:15.640 --> 0:08:19.240 at least in part, a sentiment driven event. I think 0:08:19.280 --> 0:08:22.880 it's almost entirely sentiment driven event. In fact, I think 0:08:23.280 --> 0:08:26.280 moments like that where the vix spikes twenty or twent 0:08:26.920 --> 0:08:30.360 in a day, those are the opportunistic moments rather than 0:08:30.360 --> 0:08:32.520 the moments to head for the sidelines. And I'm not 0:08:32.559 --> 0:08:35.280 talking about you know, bi speculative stuff. But when you 0:08:35.280 --> 0:08:37.880 get a Wells Fargo or a Slumberge that that are 0:08:37.920 --> 0:08:41.880 trading near their cycle lows, the panic of yesterday would 0:08:41.880 --> 0:08:43.720 be a good time. And maybe the panic of today too, 0:08:44.040 --> 0:08:45.280 was it? Was it a good time to buy? Where 0:08:45.280 --> 0:08:48.120 did you see the opportunity yesterday? We did buy some 0:08:48.160 --> 0:08:52.160 more Wells Fargo yesterday, for example, I think the premier bank. 0:08:52.360 --> 0:08:54.199 I think over the next ten years, if you pull 0:08:54.240 --> 0:08:57.040 back the lens and think broadly, we're gonna banks are 0:08:57.040 --> 0:09:00.240 going to be doing more banking and less invest spend 0:09:00.400 --> 0:09:02.360 M and A stuff over the next ten years. And 0:09:02.400 --> 0:09:05.240 Wells Fargo is perfectly positioned for that. We talked about 0:09:05.240 --> 0:09:09.680 Walmart earlier, which ten years trailing seven points something percent 0:09:09.720 --> 0:09:12.440 per year. I'm just gonna call it a mediocrity just 0:09:12.480 --> 0:09:15.600 as a general statement. What sticks out like a sore 0:09:15.679 --> 0:09:19.120 thumb is they've got the cash flow of an island nation, right, 0:09:19.360 --> 0:09:22.240 and I don't believe they're giving it the shareholders. Am 0:09:22.240 --> 0:09:25.880 I too harsh? Well? You know one, it's the law 0:09:25.920 --> 0:09:29.719 of large numbers. It's you know, sere for such a 0:09:29.760 --> 0:09:33.040 big company. Ain't bad um. But the second thing is wow, 0:09:33.160 --> 0:09:37.440 talk about competitive challenges obviously from Amazon, but from other 0:09:37.480 --> 0:09:40.960 places as well. We have a German UH discount grocer 0:09:41.000 --> 0:09:44.199 coming into the market right now, etcetera, etcetera. They may 0:09:44.200 --> 0:09:47.240 be conservative in hoarding their cash because they see things 0:09:47.240 --> 0:09:49.240 that you and I aren't seeing. Right, I'll go with that, 0:09:49.320 --> 0:09:53.000 but come on, well, we Chrissanti with this with a 0:09:53.040 --> 0:09:56.760 grossanti capital management. And I guess I don't want you 0:09:56.800 --> 0:09:58.360 to come in on a tweet, Chris, but I do 0:09:58.440 --> 0:10:02.120 want you to comment on the effect of Washington upon 0:10:02.320 --> 0:10:07.520 market animal spirit. Forget about nominal GDP, just the enthusiasm 0:10:07.559 --> 0:10:11.800 and confidence of the markets. Well, it's funny. I'm reminded 0:10:11.800 --> 0:10:14.120 eight years ago every time during the financial crisis when 0:10:14.120 --> 0:10:16.840 Obama would get on TV, the market would start to 0:10:16.960 --> 0:10:19.440 remember this go down a hundred two hundred points. And 0:10:19.440 --> 0:10:21.840 and every time I see one of these tweets, especially 0:10:21.840 --> 0:10:25.560 now that we're in the firestorm. Uh, I almost said 0:10:25.600 --> 0:10:27.640 on television this morning, Tom that that at least we 0:10:27.720 --> 0:10:29.840 haven't had a tweet, maybe he's gotten some religion. And 0:10:29.840 --> 0:10:32.000 of course I was forty five minutes too early, thinking that, 0:10:33.280 --> 0:10:37.400 remember done, and and what the market cares about, it 0:10:37.400 --> 0:10:39.760 obviously is not Trump. It cares about tax reform, it 0:10:39.800 --> 0:10:43.080 cares about regulatory relief, and and just this gets in 0:10:43.080 --> 0:10:46.680 the way. And so what we're hoping for is is 0:10:46.720 --> 0:10:49.240 it too much to ask for twelve hours of radio 0:10:49.320 --> 0:10:52.560 silence of Paul Ryan leading with tax reform instead of 0:10:52.559 --> 0:10:55.240 Independent Council. I think he would prefer that as well. 0:10:55.320 --> 0:10:57.320 Mr Ryan would prefer that Let get your sense of 0:10:57.360 --> 0:10:59.760 the economy right now, let's move away from from politics. 0:10:59.800 --> 0:11:02.160 When you look at the fundamentals how this us. Never 0:11:02.320 --> 0:11:05.040 think with the market yesterday and today that the things were, 0:11:05.200 --> 0:11:06.480 you know, quite as good as they are. You have 0:11:06.520 --> 0:11:08.400 I S M numbers that are in the mid fifties, 0:11:08.720 --> 0:11:11.760 you've got corporate profits that are beating estimates in the 0:11:11.800 --> 0:11:16.520 first quarter, and you've got things accelerating. So we're actually excited. 0:11:16.679 --> 0:11:19.920 We're buying high quality names at the sell off discount 0:11:20.000 --> 0:11:23.840 prices of yesterday and perhaps today. So I'm looking forward 0:11:23.880 --> 0:11:26.679 to this being an opportunity as we get to the 0:11:26.760 --> 0:11:30.160 kind of long slog of the methodical and thankfully quiet 0:11:30.240 --> 0:11:35.080 work of the Independent Council steptail the two of these things. UH, 0:11:35.080 --> 0:11:36.880 there was a time right after the election when people 0:11:36.880 --> 0:11:39.040 were buying stox based on where they thought the new 0:11:39.120 --> 0:11:41.880 administration was going to go. When you look at tax reform, 0:11:41.920 --> 0:11:45.520 regulatory reform, healthcare reform, UH dovetailed with with where the 0:11:45.520 --> 0:11:48.120 economist day, are there opportunities there are still in terms 0:11:48.160 --> 0:11:50.439 of what you think that the legislative priorities are in 0:11:50.679 --> 0:11:52.480 Washington are the things that you think a would David, 0:11:52.480 --> 0:11:55.960 because what I think has happened is, starting yesterday, the 0:11:55.960 --> 0:11:58.800 market seems to be discounting no tax reformat and it's 0:11:58.840 --> 0:12:00.840 going to be a tough slog. Believe it's an uphill fight, 0:12:00.920 --> 0:12:03.960 even though the Republicans have both houses. But it's there's 0:12:03.960 --> 0:12:06.960 not a zero chance. You know, I'm thinking fifty fifty, 0:12:07.120 --> 0:12:09.920 especially on corporate tax reform, and maybe better than fifty fifty. 0:12:09.960 --> 0:12:12.080 So if we get something like that, there are a 0:12:12.200 --> 0:12:15.560 number of companies in everybody's portfolio that will benefit to 0:12:15.600 --> 0:12:18.360 the tune of ten or twenty earnings growth without doing 0:12:18.360 --> 0:12:21.360 a thing from corporate tax reforms. So we're hopeful that 0:12:21.360 --> 0:12:24.280 that comes back to the headlines rather than all this stuff. 0:12:24.280 --> 0:12:28.240 You like Milon, and I love the rationale you give. 0:12:28.480 --> 0:12:30.880 We love a company with low expectations. Sure sure, Now 0:12:31.600 --> 0:12:35.559 Milan is the Teresa May of the stuff you come on. 0:12:35.880 --> 0:12:38.520 You see Milon, You're not thinking things are gonna be 0:12:38.600 --> 0:12:40.559 very good, and they surprise you on the upside. So 0:12:40.720 --> 0:12:43.240 what Milon has against it is a tough headwin. In 0:12:43.280 --> 0:12:45.880 generic drugs, this year and next year it's sold off 0:12:45.880 --> 0:12:48.839 more than fifty. But what people don't think about is 0:12:48.880 --> 0:12:51.040 it's one of the two or three big companies that 0:12:51.080 --> 0:12:54.920 has the wherewithal to really generic size these blockbuster dugs. 0:12:54.960 --> 0:12:56.720 It's just going to cost a lot of money and 0:12:56.760 --> 0:12:59.480 over again. Remember our time period is four to five years. 0:12:59.760 --> 0:13:03.360 We're thinking this is where healthcare is going, and Miland 0:13:03.440 --> 0:13:07.440 is right there at the intersection. Loyal I want to 0:13:07.440 --> 0:13:09.360 go on oil where it's just been range bound with 0:13:09.440 --> 0:13:13.400 a saggy is to one on imax, and I mean 0:13:13.440 --> 0:13:16.320 the hydrocarbons have the life of their own. How do 0:13:16.400 --> 0:13:19.200 you deal with that? You know, you take the long view, tom, 0:13:19.240 --> 0:13:24.040 I mean the positive on oil, especially on the bigger 0:13:24.080 --> 0:13:27.199 ones because the bigger ones that they've done the investing, 0:13:27.360 --> 0:13:29.840 the ten years worth of investing to big to drill 0:13:29.920 --> 0:13:32.480 deep holes in the water or in cold areas, and 0:13:32.520 --> 0:13:34.600 now they're finally going to get the cash flow from that. 0:13:35.200 --> 0:13:38.000 But all the companies, because of the oil crash over 0:13:38.080 --> 0:13:41.120 last year's have under invested. So we're gonna start to 0:13:41.200 --> 0:13:43.000 run out, whether it's at the end of this year, 0:13:43.040 --> 0:13:45.320 whether it's two years from now, four or five years 0:13:45.320 --> 0:13:48.160 from now. That price is going to be higher. Chris Kasanti, 0:13:48.240 --> 0:13:49.640 thank you so much. We need to go back to 0:13:49.679 --> 0:13:54.400 Martin Schenker has given a terrific perspective in Washington Or 0:13:54.400 --> 0:13:56.800 there's work over decades with Bloomberg News and of course 0:13:56.880 --> 0:14:06.240 with The Wall Street Journalism brought to you by Bank 0:14:06.280 --> 0:14:10.319 of America. Mary Lynch dedicated to bringing our clients insights 0:14:10.320 --> 0:14:13.960 and solutions to meet the challenges of a transforming world. 0:14:14.440 --> 0:14:18.160 That's the power of global connections. Mary Lynch, Pierce Feeder 0:14:18.240 --> 0:14:27.720 and Smith Incorporated Member s I p C. There's something 0:14:27.720 --> 0:14:31.160 new from Bloomberg. It's called Lens. Starting right now, you 0:14:31.160 --> 0:14:35.280 can use the Bloomberg iOS app off your iPhone or iPad, 0:14:35.840 --> 0:14:39.760 or our new Google Chrome extension to read any news 0:14:39.760 --> 0:14:44.120 story on any website, scan it, and then instantly see 0:14:44.160 --> 0:14:48.280 the news stories relevant market data from Bloomberg. In addition, 0:14:48.600 --> 0:14:51.640 see all the bios of the key people mentioned in 0:14:51.720 --> 0:14:54.920 the story. It's called Lens, and it is just that, 0:14:55.080 --> 0:14:58.200 a lens into the people and the data of any 0:14:58.280 --> 0:15:02.160 story you may be reading. Again, Lens brings you the 0:15:02.200 --> 0:15:05.680 power of Bloomberg's news and data. Download or io s 0:15:05.720 --> 0:15:09.040 app or search for the Bloomberg extension at the Chrome 0:15:09.160 --> 0:15:12.600 Store to try lens out. Learn more at Bloomberg dot 0:15:12.640 --> 0:15:20.040 com slash lens. Let's go to Greg Value now. He's 0:15:20.040 --> 0:15:23.160 the chief global strategist at Horizon Investments. He joins us 0:15:23.320 --> 0:15:25.600 always valuable to check in with Greg get a sense 0:15:25.640 --> 0:15:28.600 of what's going on in Washington, the pulse of Washington. 0:15:28.680 --> 0:15:30.720 We're looking at some tweets fired off by the President 0:15:30.760 --> 0:15:33.040 this morning, one of which reads, this is the single 0:15:33.080 --> 0:15:35.920 greatest which hunt of a politician in American history. That 0:15:35.960 --> 0:15:39.360 comes after the assistant the Deputy Attorney General yesterday named 0:15:39.360 --> 0:15:42.040 a special counsel to look into Russia's involvement in the 0:15:42.120 --> 0:15:44.920 US presidential election. That's Robert Mueller, the former director of 0:15:44.960 --> 0:15:48.720 the FBI, former of Council at Wilmer Haile. Greg, great 0:15:48.760 --> 0:15:52.280 to have you with us. Uh, what changes here now 0:15:52.280 --> 0:15:54.440 that we've seen the president way in There were a 0:15:54.440 --> 0:15:56.840 few hours of quiet and which we were processing what 0:15:57.040 --> 0:15:59.440 has happened, what was going to happen, what's changed because 0:15:59.480 --> 0:16:02.440 of the eastweet? Well, I tell you, David, I think 0:16:02.480 --> 0:16:06.360 as usual with indiscreet and UH complicates things. To have 0:16:06.440 --> 0:16:10.720 the president already criticizing this process. So I don't think 0:16:10.760 --> 0:16:13.360 he helped his cause, and as we all know, self 0:16:13.360 --> 0:16:16.600 inflicted wounds is one of his specialties. You've wrote about 0:16:16.600 --> 0:16:19.880 loyalty yesterday and this president's relationship to loyalty. We were 0:16:19.880 --> 0:16:22.840 talking with Marty Shanker, our senior executive editor for Government Economics, 0:16:22.880 --> 0:16:25.640 a few minutes ago, and I asked him about the 0:16:25.680 --> 0:16:28.760 short love affair this White House had with Rod Rosenstein 0:16:29.160 --> 0:16:31.960 last week. A lot of praise for him, career prosecutor, 0:16:32.080 --> 0:16:35.200 longtime public servant. It seems now with these tweets, the 0:16:35.240 --> 0:16:38.600 President has turned on mr Mr Rosenstein. What does that 0:16:38.640 --> 0:16:41.840 say to you about loyalty in this president? Well, he 0:16:41.920 --> 0:16:44.480 demands it, but he doesn't give it. Uh. There's been 0:16:44.560 --> 0:16:47.200 stories for the last week or so that he's dissatisfied 0:16:47.560 --> 0:16:52.200 with virtually everyone at the White House, including Jared Kushner. 0:16:52.560 --> 0:16:56.000 So is he now is feuding with all of his 0:16:56.240 --> 0:17:00.520 subordinates That just makes them even less inclined to support Yeah, 0:17:01.600 --> 0:17:04.160 this is fascinating. We've got an extended time with Mr 0:17:04.240 --> 0:17:06.840 Valier this morning, which is always a good and beautiful thing. 0:17:07.200 --> 0:17:08.919 We're going to stay in the theme of the moment, 0:17:08.960 --> 0:17:11.680 and I want to go forward to the midterm elections 0:17:11.680 --> 0:17:15.600 in our next section with Mr Valier, greg is always 0:17:15.600 --> 0:17:18.159 you lead your notes strong this morning with the horizon 0:17:18.800 --> 0:17:22.320 on the Vice President of the United States. Who is 0:17:22.920 --> 0:17:27.439 Mr Pence, the former governor of Indiana, And because of 0:17:27.560 --> 0:17:31.879 who he is, how does he adapt to this? Well, Tom, 0:17:32.119 --> 0:17:37.160 first of all, he is the anti Trump uh low keied, modest, 0:17:37.240 --> 0:17:43.080 doesn't brag, monogamous, deeply religious of altar boy in his youth. 0:17:43.480 --> 0:17:46.880 So from that standpoint, he's different. From a policy standpoint, 0:17:47.240 --> 0:17:52.919 he's more traditionally a Republican, pro trade, pro business. I 0:17:53.040 --> 0:17:57.160 think that the Republican base could very very much get 0:17:57.200 --> 0:18:00.439 along with the president Pence has would the mark. What 0:18:00.640 --> 0:18:04.040 is Pence's relationship with the White House? We have Mondale, 0:18:04.080 --> 0:18:08.040 we have other vice presidents, Mr Biden. Obviously, how do 0:18:08.080 --> 0:18:10.520 you fit Mike Pence into the day to day grind 0:18:10.920 --> 0:18:14.080 of the Trump White House? Well, I think he's one 0:18:14.080 --> 0:18:17.159 of the survivors. Obviously, he fits in pretty well. He 0:18:17.200 --> 0:18:20.440 has great contacts on the Hill, gets along with Paul, 0:18:21.000 --> 0:18:24.199 Paul Ryan and others, So I think he does fit in. 0:18:24.320 --> 0:18:26.520 And this is someone who's got a lot of experience 0:18:26.760 --> 0:18:29.439 as a member of the House, as a governor, and 0:18:29.760 --> 0:18:33.720 I again, in so many respects, Tom he's the anti Trump. 0:18:35.000 --> 0:18:39.119 Let you mentioned the discord within the inner ranks of 0:18:39.440 --> 0:18:43.000 this administration. The president preparing to take his first trip overseas, 0:18:43.040 --> 0:18:44.720 and number of the men and women you mentioned will 0:18:44.720 --> 0:18:47.439 be accompanying him on that that trip. How was the 0:18:47.520 --> 0:18:49.640 discord that we've seen in Washington over these last few 0:18:49.720 --> 0:18:52.480 days going to come come with him to Europe and 0:18:52.480 --> 0:18:54.280 to the Middle East? Or will it? Are they content 0:18:54.320 --> 0:18:57.680 to leave it behind? Well? I think it'll it will 0:18:57.720 --> 0:19:01.480 follow him, and knowing Trump, and I mean, let's face it, guys, 0:19:01.520 --> 0:19:04.040 for the last couple of weeks, there's been a bombshell 0:19:04.200 --> 0:19:08.440 every day, sometimes two bombshells every day. This morning there's 0:19:08.720 --> 0:19:12.680 new reports about from Reuters about contacts with the Russians. 0:19:12.720 --> 0:19:16.720 So it's it's it's an ongoing DRUMA from me, guys, 0:19:16.840 --> 0:19:18.840 I think that the big story is going to be 0:19:19.600 --> 0:19:21.520 his talks with the Israelis. There are a lot of 0:19:21.560 --> 0:19:24.720 prose Raeli folks that I've talked to recently who were 0:19:24.760 --> 0:19:29.280 concerned by what he told Abbas, the Palestinian leader a 0:19:29.280 --> 0:19:32.640 few weeks ago. Will he do things that could make 0:19:32.640 --> 0:19:35.600 the Israelis nervous? Jesus Ford Greg to our next section. 0:19:35.680 --> 0:19:38.520 Can the Republicans lose the House in the mid term? 0:19:39.800 --> 0:19:42.639 They could? I think the odds slightly favored of keeping 0:19:42.680 --> 0:19:45.399 the House. They'll They'll keep the sound for sure. Greg 0:19:45.840 --> 0:19:48.119 joins us. He is from New Hampshire. Greg, when did 0:19:48.160 --> 0:19:50.600 you first learn about Mr Ailes? Was it with Nixon 0:19:50.720 --> 0:19:55.000 or was it a campaign after that with Lee att Water? Well? Yeah, 0:19:55.359 --> 0:19:58.320 during those days, he was a fascinating and polarizing figure 0:19:58.359 --> 0:20:00.879 and he continued to be one for the rest of 0:20:00.920 --> 0:20:04.080 his life. I mean a dramatic impact on all of 0:20:04.160 --> 0:20:07.679 us who are in this industry. How associated is a 0:20:07.760 --> 0:20:10.199 Republican party that you follow every day? We were going 0:20:10.240 --> 0:20:12.359 to talk about the mid terms, which was his belly 0:20:12.400 --> 0:20:18.119 whack years ago. Um. How how Roger ale Z is 0:20:18.240 --> 0:20:22.440 the GOP right now? Well, I think he is one 0:20:22.440 --> 0:20:26.280 of the architects of the agenda, much more combative, far 0:20:26.400 --> 0:20:32.240 less conciliatory, real really going after issues with a ferocity 0:20:32.320 --> 0:20:36.720 that we hadn't seen in previous decades. When you look 0:20:36.720 --> 0:20:39.160 at the mid terms and we are still a few 0:20:39.160 --> 0:20:41.840 months out from from them taking place, what is what 0:20:41.880 --> 0:20:44.160 we've seen over the last week in terms of how 0:20:44.320 --> 0:20:47.680 lawmakers on Capitol will have regarded and positioned themselves relative 0:20:47.680 --> 0:20:50.080 to the president. Tell you about how they'll do that 0:20:50.200 --> 0:20:52.199 going into the mid terms. Is this the president they 0:20:52.200 --> 0:20:56.440 want to continue to affiliate themselves with. For now, I 0:20:56.800 --> 0:21:00.720 don't see a total rupture, but you know, the cliche 0:21:00.880 --> 0:21:03.359 is a week is a lifetime in politics, and you 0:21:03.400 --> 0:21:06.040 know the following eighteen is a long long way off, 0:21:06.119 --> 0:21:09.160 so you know, things things could change. I do think 0:21:09.560 --> 0:21:14.160 if if the new special prosecutor it gets more bombshells, 0:21:14.280 --> 0:21:17.160 if we hear more about Trump and Russia, you will 0:21:17.200 --> 0:21:21.000 see a lot of Republicans, especially in the North, abandon him. 0:21:21.200 --> 0:21:24.080 Not that I would ever correct Greg, Yeah, but Mr Gurl, 0:21:24.080 --> 0:21:26.639 I would suggest it a week is not a lifetime 0:21:26.720 --> 0:21:31.920 and it's more like three hours. Or trying to get David, 0:21:33.000 --> 0:21:34.480 what are you looking for out of this trip that 0:21:34.560 --> 0:21:37.160 the president is going to take. Is the achievement going 0:21:37.200 --> 0:21:39.760 to be him successfully navigating these ten days on the 0:21:39.840 --> 0:21:42.320 road or is there a broader theme to the trip 0:21:42.359 --> 0:21:45.520 that he's about to take. Well, I tell you, excuse 0:21:45.560 --> 0:21:48.280 my French, but they just can't screw up. I mean, 0:21:48.440 --> 0:21:51.000 I think that's a low bar to clear, but that 0:21:51.000 --> 0:21:53.440 that is something they have to avoid. Any kind of 0:21:53.680 --> 0:21:57.119 clubs or faux pas things like that. Beyond that, I 0:21:57.560 --> 0:22:01.840 would look at the Israeli talks because there's speculation that 0:22:01.920 --> 0:22:05.600