1 00:00:02,520 --> 00:00:10,119 Speaker 1: Bloomberg Audio Studios, podcasts, radio news. You're listening to the 2 00:00:10,119 --> 00:00:13,880 Speaker 1: Bloomberg Balance of Power podcast. Catch us live weekdays at 3 00:00:13,920 --> 00:00:17,119 Speaker 1: noon and five pm Eastern on Apple Coarclay and Android 4 00:00:17,160 --> 00:00:20,560 Speaker 1: Auto with the Bloomberg Business App. Listen on demand wherever 5 00:00:20,600 --> 00:00:25,080 Speaker 1: you get your podcasts, or watch us live on YouTube. 6 00:00:25,600 --> 00:00:28,400 Speaker 2: Got a couple of plates that we're spinning today as always, 7 00:00:28,400 --> 00:00:30,920 Speaker 2: so welcome. It's great to have you aboard with our 8 00:00:30,960 --> 00:00:33,120 Speaker 2: eyes on the White House. President Trump has been speaking 9 00:00:33,120 --> 00:00:35,559 Speaker 2: for a little while right now in an effort to 10 00:00:35,720 --> 00:00:38,640 Speaker 2: actually he's got some business at hand. He's now talking 11 00:00:38,680 --> 00:00:41,400 Speaker 2: about tariffs and a few other matters, but in fact 12 00:00:41,479 --> 00:00:45,519 Speaker 2: was signing a couple of resolutions. White House called them bills, 13 00:00:45,600 --> 00:00:50,240 Speaker 2: resolutions that target California's ev incentives. They repeal the state 14 00:00:50,320 --> 00:00:52,760 Speaker 2: level mandates that have been in place now supported by 15 00:00:52,760 --> 00:00:58,960 Speaker 2: the Biden administration. GM Toyota among those lobbying against California's rules. 16 00:00:59,040 --> 00:01:01,600 Speaker 2: If he makes some new here on the story that 17 00:01:01,640 --> 00:01:04,120 Speaker 2: we're about to tackle, we'll bring you to the White House. 18 00:01:04,760 --> 00:01:07,880 Speaker 2: Because this is a precarious moment ahead of more talks 19 00:01:07,959 --> 00:01:11,480 Speaker 2: that are scheduled for this weekend. May not be an 20 00:01:11,560 --> 00:01:15,240 Speaker 2: accident considering the timing with what we're seeing here, but 21 00:01:15,400 --> 00:01:18,200 Speaker 2: a stark headline at the top of the New York Times, 22 00:01:18,680 --> 00:01:22,440 Speaker 2: Israel appears ready to attack Iran. Knowing that this has 23 00:01:22,440 --> 00:01:24,280 Speaker 2: been in the air for some time, and we've talked 24 00:01:24,280 --> 00:01:27,880 Speaker 2: about it, certainly quite a bit since Benjaminett Yahoo made 25 00:01:27,880 --> 00:01:30,600 Speaker 2: his most recent visit to the White House, a visit 26 00:01:30,680 --> 00:01:34,720 Speaker 2: in which President Trump reportedly waived him off, and it 27 00:01:34,800 --> 00:01:36,720 Speaker 2: might be a little bit different this time. With what 28 00:01:36,760 --> 00:01:39,200 Speaker 2: we're hearing, Israel appears to be preparing to launch the 29 00:01:39,280 --> 00:01:43,000 Speaker 2: attack soon, according to officials in the US and Europe, 30 00:01:43,440 --> 00:01:46,679 Speaker 2: obviously at a very sensitive time here in the Middle East. 31 00:01:47,360 --> 00:01:51,080 Speaker 2: But as I mentioned, American and Iranian negotiators are supposed 32 00:01:51,080 --> 00:01:53,040 Speaker 2: to get back to the table here on Sunday for 33 00:01:53,120 --> 00:01:55,680 Speaker 2: another round of talks. And that's where we begin our 34 00:01:55,720 --> 00:01:58,640 Speaker 2: conversation with Natasha Hall. Delighted to say she could join 35 00:01:58,760 --> 00:02:02,800 Speaker 2: us today at this moment, non resident Senior Associate Geopolitics, 36 00:02:02,800 --> 00:02:06,720 Speaker 2: Foreign Policy Department at CSIS, the Center for Strategic and 37 00:02:06,800 --> 00:02:07,880 Speaker 2: International Studies. 38 00:02:08,120 --> 00:02:09,440 Speaker 3: Natasha, it's great to see you. 39 00:02:09,840 --> 00:02:11,800 Speaker 2: How much of this do we think is bluster ahead 40 00:02:11,800 --> 00:02:13,520 Speaker 2: of the next round of talks or is this a 41 00:02:13,560 --> 00:02:15,239 Speaker 2: real attack that could be in the offinge. 42 00:02:16,560 --> 00:02:17,880 Speaker 4: Thank you so much for having me. 43 00:02:18,240 --> 00:02:20,640 Speaker 5: It's a very tense moment, I have to say, And 44 00:02:20,720 --> 00:02:23,000 Speaker 5: I think that's really the question whether or not this 45 00:02:23,080 --> 00:02:26,640 Speaker 5: is a negotiating tactic. As you mentioned, Witkoff is heading 46 00:02:26,639 --> 00:02:30,320 Speaker 5: to Oman on Sunday for the sixth round of negotiations 47 00:02:30,320 --> 00:02:34,880 Speaker 5: with Iranian officials, both direct and indirect, and also tomorrow 48 00:02:34,880 --> 00:02:36,359 Speaker 5: on Friday, Witkoff. 49 00:02:35,960 --> 00:02:37,560 Speaker 4: Will meet with Israeli officials. 50 00:02:37,800 --> 00:02:40,480 Speaker 5: So do Israeli officials can talk about their concerns with 51 00:02:40,520 --> 00:02:44,320 Speaker 5: regards to the Iranian nuclear program, and one would think 52 00:02:44,360 --> 00:02:47,720 Speaker 5: it's also about a potential attack. Now, whether or not 53 00:02:47,760 --> 00:02:50,880 Speaker 5: that attack actually takes place, I think remains to be seen, 54 00:02:51,840 --> 00:02:54,399 Speaker 5: because I for sure Trump does not want a never 55 00:02:54,520 --> 00:02:59,079 Speaker 5: ending war. The issue is that Nettagnahu does. It protects 56 00:02:59,120 --> 00:03:04,680 Speaker 5: him politically, and surely there are fears in Israel of 57 00:03:04,760 --> 00:03:09,120 Speaker 5: any kind of Iranian nuclear activity. But the question again, 58 00:03:09,160 --> 00:03:10,880 Speaker 5: and I think I mentioned this last time I was 59 00:03:10,880 --> 00:03:14,440 Speaker 5: on the program, is on enrichment. Israel does not want 60 00:03:14,480 --> 00:03:17,920 Speaker 5: Iran to be able to enrich and Iran sees it 61 00:03:17,960 --> 00:03:20,360 Speaker 5: as an issue of sovereignty that they can't. 62 00:03:21,760 --> 00:03:23,919 Speaker 2: Well, so we were just looking at images of Steve Witkoff, 63 00:03:23,960 --> 00:03:28,320 Speaker 2: who is still planning to attend the negotiations. He certainly 64 00:03:28,360 --> 00:03:32,799 Speaker 2: knows this, Natasha. Is he capable of walking Iran back 65 00:03:32,840 --> 00:03:36,080 Speaker 2: from that line or have we in fact found ourselves 66 00:03:36,880 --> 00:03:37,920 Speaker 2: at a standoff here. 67 00:03:39,400 --> 00:03:42,360 Speaker 5: Well, what's interesting is is just yesterday he said that 68 00:03:42,400 --> 00:03:46,760 Speaker 5: Iran can't enriched uranium, and the US has been back 69 00:03:46,800 --> 00:03:50,560 Speaker 5: and forth on this, including President Trump. It's unclear if 70 00:03:50,560 --> 00:03:54,120 Speaker 5: they understand the details of uranium and enrichment and a 71 00:03:54,160 --> 00:03:57,920 Speaker 5: nuclear program for Iran, and I suspect that they're getting 72 00:03:57,960 --> 00:04:01,000 Speaker 5: a lot of their advice from Israel. The big question 73 00:04:01,400 --> 00:04:03,600 Speaker 5: is if they are willing to go along with an 74 00:04:03,640 --> 00:04:08,200 Speaker 5: Israeli attack, because certainly a coordinated US Israeli attack on 75 00:04:08,360 --> 00:04:13,880 Speaker 5: Iranian nuclear facilities would be more profound than Israel going 76 00:04:13,920 --> 00:04:15,960 Speaker 5: it alone, so to speak, but they would have to 77 00:04:16,000 --> 00:04:19,800 Speaker 5: at least get the green light. Obviously Wickkoff knows all 78 00:04:19,839 --> 00:04:23,839 Speaker 5: of this, So potentially we're seeing the evacuation of personnel. 79 00:04:24,000 --> 00:04:27,040 Speaker 5: We're seeing a lot of this bluster as a means 80 00:04:27,080 --> 00:04:30,520 Speaker 5: to sort of up the anti prior to these negotiations 81 00:04:30,560 --> 00:04:32,640 Speaker 5: to really push Iran to the edge. 82 00:04:33,040 --> 00:04:35,520 Speaker 4: It's still totally well. 83 00:04:35,360 --> 00:04:37,800 Speaker 2: Accepted, seems like a lot of trouble to be moving 84 00:04:37,839 --> 00:04:41,440 Speaker 2: all these people to just put on a show. But Natasha, 85 00:04:41,480 --> 00:04:43,920 Speaker 2: we do have a really important piece of news here 86 00:04:43,920 --> 00:04:46,440 Speaker 2: that Steve Witkoff will have with him at the table. 87 00:04:46,480 --> 00:04:48,720 Speaker 2: This is the hook the administration, I guess, could lean 88 00:04:48,760 --> 00:04:52,600 Speaker 2: on if in fact an attack move forward. Here the 89 00:04:52,640 --> 00:04:56,680 Speaker 2: IAEA declaring Thursday Iran is not complying with nuclear non 90 00:04:56,720 --> 00:05:01,559 Speaker 2: proliferation obligations, the first time the UN's watchdog has passed 91 00:05:01,560 --> 00:05:05,080 Speaker 2: a resolution against the country in twenty years. What did 92 00:05:05,120 --> 00:05:06,600 Speaker 2: you think when you saw that headline? 93 00:05:07,920 --> 00:05:08,680 Speaker 4: Yeah, I thought it. 94 00:05:08,600 --> 00:05:12,600 Speaker 5: Was interesting because again you said it's unprecedented. It is unprecedented, 95 00:05:12,640 --> 00:05:15,240 Speaker 5: and it shows that the US is working with the 96 00:05:15,240 --> 00:05:19,680 Speaker 5: E three and with the IAEA on really putting the 97 00:05:19,720 --> 00:05:23,920 Speaker 5: pressure on Iran to move forward with this. So, I mean, 98 00:05:24,000 --> 00:05:26,839 Speaker 5: we could be hopeful, but again, you know, last year 99 00:05:26,839 --> 00:05:29,960 Speaker 5: we saw something like one hundred and seventy Iranian and 100 00:05:30,000 --> 00:05:33,240 Speaker 5: Iranian praxy attacks on US assets. 101 00:05:32,800 --> 00:05:36,280 Speaker 4: In the region, so very very scary times. 102 00:05:36,839 --> 00:05:39,440 Speaker 5: I think we'll see a lot of tensions, especially in 103 00:05:39,480 --> 00:05:43,520 Speaker 5: some of these other countries like Iraq, where there are 104 00:05:43,680 --> 00:05:48,039 Speaker 5: softer targets as well. But the ia can't do much 105 00:05:48,080 --> 00:05:50,120 Speaker 5: but it is another negotiating tactic. 106 00:05:50,200 --> 00:05:54,880 Speaker 2: I think, well, you make an interesting point here about 107 00:05:55,000 --> 00:05:58,520 Speaker 2: US involvement, because it does seem that Israel would need 108 00:05:58,560 --> 00:06:01,120 Speaker 2: some help based on some of the that we've done here. 109 00:06:01,520 --> 00:06:06,680 Speaker 2: You consider the use of bunker busters, air defenses, refueling. 110 00:06:07,320 --> 00:06:09,599 Speaker 2: How far would the US go and taking part here, 111 00:06:12,040 --> 00:06:12,760 Speaker 2: I mean, that's. 112 00:06:12,720 --> 00:06:14,760 Speaker 4: The I think that's the million dollar question. 113 00:06:15,600 --> 00:06:18,239 Speaker 5: It's unclear if the US would even be public about 114 00:06:18,279 --> 00:06:20,960 Speaker 5: coordination with Israel. I think most people would agree that 115 00:06:21,000 --> 00:06:24,800 Speaker 5: they would be green lighted and in order to do 116 00:06:25,000 --> 00:06:28,479 Speaker 5: the attack, it would be quite reason for Israel to 117 00:06:28,560 --> 00:06:32,240 Speaker 5: go it alone. But judging by the statements of Witcough 118 00:06:32,320 --> 00:06:35,839 Speaker 5: and of Trump in recent days, it looks like they 119 00:06:35,880 --> 00:06:38,520 Speaker 5: are very publicly giving the green light, which is again 120 00:06:38,560 --> 00:06:40,200 Speaker 5: why they're evacuating personnel. 121 00:06:40,600 --> 00:06:43,480 Speaker 4: But I would just say one more thing for your listeners. 122 00:06:43,520 --> 00:06:44,280 Speaker 4: An attack on an. 123 00:06:44,200 --> 00:06:49,960 Speaker 5: Iranian nuclear facility has happened before, but Israel are sorry. 124 00:06:50,000 --> 00:06:55,159 Speaker 5: Iran just goes back to enriching uranium at another level 125 00:06:55,200 --> 00:06:59,080 Speaker 5: and accelerates potentially, so we could see that again. And 126 00:06:59,240 --> 00:07:01,960 Speaker 5: you know, quite we've been talking about rising tensions in 127 00:07:01,960 --> 00:07:04,440 Speaker 5: the Middle East quite a bit for two years and 128 00:07:04,480 --> 00:07:08,360 Speaker 5: It's unclear where this ends, but hopefully it will come 129 00:07:08,400 --> 00:07:12,520 Speaker 5: to some kind of de escalation by next week, because 130 00:07:12,600 --> 00:07:14,960 Speaker 5: I think everyone is on the edge of their seats 131 00:07:15,000 --> 00:07:16,360 Speaker 5: at this moment in the region. 132 00:07:17,600 --> 00:07:19,840 Speaker 2: Israel certainly believes it's in the position of power here 133 00:07:19,880 --> 00:07:21,760 Speaker 2: right Natasha. As we've discussed, there are a couple of 134 00:07:21,760 --> 00:07:24,200 Speaker 2: reasons why we've found ourselves at this moment, and a 135 00:07:24,200 --> 00:07:25,600 Speaker 2: lot of it has to do with the lack of 136 00:07:25,640 --> 00:07:28,760 Speaker 2: air defenses right now that Iran has following the most 137 00:07:28,800 --> 00:07:34,560 Speaker 2: recent back and forth with Israel, but also an emboldened 138 00:07:34,800 --> 00:07:38,280 Speaker 2: Benjamin net and Yahoo following some of the strife. 139 00:07:37,920 --> 00:07:40,360 Speaker 3: That we've seen in the region. Here. 140 00:07:40,880 --> 00:07:44,080 Speaker 2: The idea as well that Iran would respond with hundreds 141 00:07:44,080 --> 00:07:46,800 Speaker 2: of ballistic missiles, as I read in this story in 142 00:07:46,800 --> 00:07:49,320 Speaker 2: the New York Times, being laughed at by Israel because 143 00:07:49,400 --> 00:07:52,800 Speaker 2: last time they tried that, most of them were knocked down. Natasha, 144 00:07:52,440 --> 00:07:56,240 Speaker 2: Israel not have the moment that it was looking for. 145 00:07:57,840 --> 00:08:00,960 Speaker 5: Iran is in a very vulnerable position. As you point 146 00:08:00,960 --> 00:08:04,600 Speaker 5: out that there was many different Israeli attacks on Iran 147 00:08:04,640 --> 00:08:09,840 Speaker 5: and Iranian proxies last year that's severely degraded Iran, including Hasbudlah, 148 00:08:09,960 --> 00:08:14,120 Speaker 5: which Iran uses to essentially launch attacks onto Israel and 149 00:08:14,360 --> 00:08:18,000 Speaker 5: neighboring Lebanon. It doesn't really have that as much anymore, 150 00:08:18,000 --> 00:08:21,480 Speaker 5: and certainly not Iran in Syria, and so Iran is 151 00:08:21,480 --> 00:08:25,600 Speaker 5: in a very very vulnerable position. That said, again, Iran 152 00:08:25,720 --> 00:08:29,800 Speaker 5: doesn't go to war toud to with the US or Israel. 153 00:08:30,040 --> 00:08:33,559 Speaker 5: It sort of negotiates itself in the weeds of these 154 00:08:33,600 --> 00:08:37,160 Speaker 5: various countries like Iraq, and I would have you know that, 155 00:08:37,240 --> 00:08:39,920 Speaker 5: you know, the one hundred and seventy attacks also last year, 156 00:08:39,960 --> 00:08:45,679 Speaker 5: Iranian attacks, very few casualties of US airmen, of US servicemen, 157 00:08:46,080 --> 00:08:48,360 Speaker 5: and so you know, I mean it's weak attacks, but 158 00:08:48,440 --> 00:08:52,160 Speaker 5: it does, you know, up the anti considerably, and it 159 00:08:52,200 --> 00:08:54,240 Speaker 5: makes it much much harder for the US to have 160 00:08:54,280 --> 00:08:56,480 Speaker 5: a presence in the peast as well. 161 00:08:57,600 --> 00:09:00,040 Speaker 2: We're at a time, Natasha, if this happens would be 162 00:09:00,080 --> 00:09:00,840 Speaker 2: after Sunday. 163 00:09:02,720 --> 00:09:04,680 Speaker 4: I would suspect this would be after Sunday. 164 00:09:04,800 --> 00:09:07,160 Speaker 5: Yes, for sure, I think again, you know whether or 165 00:09:07,240 --> 00:09:12,040 Speaker 5: not this is for real or not, it's certainly negotiating tactic. 166 00:09:13,559 --> 00:09:16,840 Speaker 2: This next round of talk is going to be critically important. Natasha, 167 00:09:16,920 --> 00:09:19,080 Speaker 2: hall I'm so glad that you could join us from 168 00:09:19,080 --> 00:09:22,640 Speaker 2: the Center for strategic and international studies, a real voice 169 00:09:22,640 --> 00:09:24,360 Speaker 2: of expertise that we can bring you here. 170 00:09:26,600 --> 00:09:30,080 Speaker 1: You're listening to the Bloomberg Balance of Power podcast. Catch 171 00:09:30,160 --> 00:09:33,000 Speaker 1: us live weekdays at noon and five pm e's durn 172 00:09:33,160 --> 00:09:36,560 Speaker 1: on Apple Cocklay and Android Auto with the Bloomberg Business App. 173 00:09:36,600 --> 00:09:39,640 Speaker 1: You can also listen live on Amazon Alexa from our 174 00:09:39,679 --> 00:09:44,520 Speaker 1: flagship New York station Just Say Alexa played Bloomberg eleven thirty. 175 00:09:45,840 --> 00:09:48,480 Speaker 6: Or essentially flat at least on WTI crew today, but 176 00:09:48,520 --> 00:09:52,079 Speaker 6: both for WTI and Brent yesterday we saw a very 177 00:09:52,080 --> 00:09:55,439 Speaker 6: big move to the upside, more than four percent on each, 178 00:09:55,600 --> 00:10:00,800 Speaker 6: in part after the US decision to pull US diplomats 179 00:10:00,920 --> 00:10:03,840 Speaker 6: essentially out of Baghdad, as well as issue warnings to 180 00:10:04,040 --> 00:10:07,200 Speaker 6: family members of military members in the Middle East, all 181 00:10:07,240 --> 00:10:10,040 Speaker 6: feeding into concern of something that might be coming. Is 182 00:10:10,080 --> 00:10:12,640 Speaker 6: there were reports last night that Israel could be ready 183 00:10:12,920 --> 00:10:16,240 Speaker 6: to strike Iron's nuclear facilities. And that's something that President 184 00:10:16,240 --> 00:10:19,640 Speaker 6: Trump today, when speaking and answering questions from reporters at 185 00:10:19,640 --> 00:10:22,719 Speaker 6: the White House, did not necessarily play down Joe. He 186 00:10:22,800 --> 00:10:25,199 Speaker 6: suggested there could be massive conflict coming. 187 00:10:25,280 --> 00:10:27,240 Speaker 2: That's right, he said, it could well happen, knowing of 188 00:10:27,240 --> 00:10:29,960 Speaker 2: course that talks are still set for Sunday. Steve Whitcoff 189 00:10:30,000 --> 00:10:32,840 Speaker 2: will be in Oman, and there could be some posturing 190 00:10:33,360 --> 00:10:36,760 Speaker 2: ahead of those talks. But this is a precarious moment 191 00:10:37,080 --> 00:10:40,280 Speaker 2: and Michael Allen from Beacon Global Strategies was the first 192 00:10:40,280 --> 00:10:42,800 Speaker 2: to float the idea here on the program when Benjaminett 193 00:10:42,800 --> 00:10:44,760 Speaker 2: and Yah who came to town that that is in 194 00:10:44,800 --> 00:10:47,360 Speaker 2: fact what they were talking about. Michael, we know that 195 00:10:47,480 --> 00:10:50,400 Speaker 2: President Trump waved off that attack at the time. 196 00:10:50,480 --> 00:10:53,520 Speaker 3: It's become known since then at least is he going 197 00:10:53,600 --> 00:10:54,640 Speaker 3: to wave off this one? 198 00:10:54,840 --> 00:10:55,840 Speaker 7: I think he might try. 199 00:10:55,880 --> 00:10:58,559 Speaker 8: I think he sees some benefit right now and holding 200 00:10:58,600 --> 00:11:01,520 Speaker 8: out the prospect that the Israelis might go for it 201 00:11:01,559 --> 00:11:04,280 Speaker 8: because he wants to strengthen Steve Whitcoff's hand as he 202 00:11:04,320 --> 00:11:07,080 Speaker 8: goes to Aman this weekend. But when you really start 203 00:11:07,120 --> 00:11:09,000 Speaker 8: to look at some of the factors that are going 204 00:11:09,120 --> 00:11:14,400 Speaker 8: Israel's way today, just this morning, the International Atomic Energy Agency, 205 00:11:14,480 --> 00:11:19,120 Speaker 8: the UN Watchdon Group declared Iran in breach of the 206 00:11:19,160 --> 00:11:21,680 Speaker 8: Non Proliferation Treaty. That's the first time in twenty years 207 00:11:21,800 --> 00:11:24,920 Speaker 8: rice has happened. That is significant around the globe. It's 208 00:11:24,960 --> 00:11:27,360 Speaker 8: not that I think Israel would be toasted if they 209 00:11:27,360 --> 00:11:32,719 Speaker 8: were to bomb Iran. But it's sort of more understandable 210 00:11:33,080 --> 00:11:35,719 Speaker 8: in the aftermath of this than it would be otherwise, 211 00:11:35,840 --> 00:11:38,240 Speaker 8: especially when you consider that the next step might be 212 00:11:38,320 --> 00:11:41,679 Speaker 8: to refer this to the UN Security Council, which also 213 00:11:41,760 --> 00:11:45,120 Speaker 8: would trigger additional sanctions from around the world. And if 214 00:11:45,120 --> 00:11:48,720 Speaker 8: Iran gets out of the Non Proliferation Treaty altogether, that 215 00:11:48,760 --> 00:11:51,240 Speaker 8: could almost be an invitation for Israel. 216 00:11:50,960 --> 00:11:51,520 Speaker 7: To go for it. 217 00:11:51,720 --> 00:11:53,880 Speaker 6: Okay, so may provide Israel some cover, But at the 218 00:11:53,920 --> 00:11:56,439 Speaker 6: same time, wouldn't those very same things you're talking about 219 00:11:56,480 --> 00:11:58,720 Speaker 6: signal that the US has no real hope of getting 220 00:11:58,760 --> 00:12:01,520 Speaker 6: a nuclear deal with Iran when Iran is doing such things. 221 00:12:01,679 --> 00:12:04,040 Speaker 8: I think it's really really tough because when you think 222 00:12:04,040 --> 00:12:08,680 Speaker 8: about enrichment, our position is no enrichment in Iran. Their 223 00:12:08,760 --> 00:12:11,560 Speaker 8: position is this is one of our red lines that 224 00:12:11,559 --> 00:12:14,160 Speaker 8: we can't give it up. And we're talking about a consortium. 225 00:12:14,160 --> 00:12:17,720 Speaker 8: Could we do nuclear fuel rods of somewhere else in 226 00:12:17,760 --> 00:12:21,000 Speaker 8: the Middle East? And Iran, I think, is basically saying no, 227 00:12:21,240 --> 00:12:24,400 Speaker 8: it needs to be inside of our own territory, and 228 00:12:24,440 --> 00:12:26,720 Speaker 8: I think that's why the talks have foundered so far. 229 00:12:27,400 --> 00:12:28,600 Speaker 3: So let's say this happens. 230 00:12:29,160 --> 00:12:33,360 Speaker 2: Does the US provide logistical support, actual hardware, what would 231 00:12:33,360 --> 00:12:36,160 Speaker 2: be the relationship, or do we sit back and watch 232 00:12:36,200 --> 00:12:36,640 Speaker 2: this happen. 233 00:12:36,720 --> 00:12:38,360 Speaker 7: So this is the million dollar question. 234 00:12:38,559 --> 00:12:41,679 Speaker 8: Have we turned over already the types of munitions that 235 00:12:41,720 --> 00:12:45,319 Speaker 8: the Israelis would need. Presumably they would want the MOAB, 236 00:12:45,360 --> 00:12:48,160 Speaker 8: the Mother of All bombs, other bunker busters, They would 237 00:12:48,160 --> 00:12:50,680 Speaker 8: probably want some refueling help from the United States. 238 00:12:50,679 --> 00:12:52,839 Speaker 7: But what they really need is what we did the 239 00:12:52,920 --> 00:12:53,559 Speaker 7: last two. 240 00:12:53,400 --> 00:12:57,240 Speaker 8: Times there were missiles and drones going between the two countries. 241 00:12:57,280 --> 00:13:00,760 Speaker 8: They need the US Navy out there with IEJIS destroyers 242 00:13:01,160 --> 00:13:04,200 Speaker 8: knocking down some of these Iranian incoming. And I don't 243 00:13:04,240 --> 00:13:06,920 Speaker 8: know if President Trump is ready to do these three 244 00:13:06,920 --> 00:13:07,320 Speaker 8: things now. 245 00:13:07,360 --> 00:13:08,800 Speaker 7: The Israelis may go for it anyway. 246 00:13:08,920 --> 00:13:13,000 Speaker 8: They're famously creative and think pager operation and a million 247 00:13:13,040 --> 00:13:15,400 Speaker 8: other things, so they may not need the bucker Buster, 248 00:13:15,520 --> 00:13:17,400 Speaker 8: or they may have an alternative plan. 249 00:13:17,880 --> 00:13:19,840 Speaker 7: But these are some big question marks. 250 00:13:20,080 --> 00:13:22,360 Speaker 6: Well, And as you bring us back to what we've 251 00:13:22,360 --> 00:13:24,439 Speaker 6: seen in the past, when Iran has sent drones and 252 00:13:24,480 --> 00:13:27,319 Speaker 6: missiles toward Israel, those were largely intercepted, not just with 253 00:13:27,400 --> 00:13:29,480 Speaker 6: help of the US but with Jordan as well. So 254 00:13:29,520 --> 00:13:32,960 Speaker 6: when we consider the potential for Iranian retaliation here, is 255 00:13:33,000 --> 00:13:38,080 Speaker 6: there some major damage that they actually can successfully inflict, 256 00:13:38,120 --> 00:13:41,800 Speaker 6: considering they weren't successful in past iterations. 257 00:13:41,280 --> 00:13:43,640 Speaker 8: They might be able to get I presumably they would 258 00:13:43,640 --> 00:13:47,840 Speaker 8: throw a lot more ballistic missiles and whatever into Israel, 259 00:13:47,920 --> 00:13:50,000 Speaker 8: so it may well hit this time. But I think 260 00:13:50,000 --> 00:13:52,839 Speaker 8: what they're really worried about the United States in particular, 261 00:13:53,040 --> 00:13:58,240 Speaker 8: is would the Iranians hit the golf allies of Israel 262 00:13:58,360 --> 00:14:01,360 Speaker 8: and the United States. What would happen in Saudi Arabia? 263 00:14:01,480 --> 00:14:05,479 Speaker 8: Remember they hit Abcake last time, the big gigantic oil facility. 264 00:14:05,800 --> 00:14:08,040 Speaker 8: They've also take at least the who needs have taken 265 00:14:08,080 --> 00:14:11,319 Speaker 8: shots in the UAE before. So I think the Iranians 266 00:14:11,360 --> 00:14:14,960 Speaker 8: have signaled you know what, if we get hit, don't 267 00:14:15,000 --> 00:14:17,600 Speaker 8: think that it's just coming back at Israel. It may 268 00:14:17,679 --> 00:14:20,640 Speaker 8: come also to your gold ally. So that's a big 269 00:14:20,880 --> 00:14:22,040 Speaker 8: conflagration right there. 270 00:14:22,080 --> 00:14:24,360 Speaker 2: What do you make of the move in Iraq? We're 271 00:14:24,360 --> 00:14:26,520 Speaker 2: trying to get US personnel out of the way already. 272 00:14:26,800 --> 00:14:28,640 Speaker 2: What is the target in Iraq that would be of 273 00:14:28,720 --> 00:14:29,520 Speaker 2: value to Iran? 274 00:14:29,760 --> 00:14:32,920 Speaker 8: Well, just any place where there are concentrations of Americans 275 00:14:32,920 --> 00:14:34,960 Speaker 8: in the Middle East that are within sort of this 276 00:14:35,000 --> 00:14:38,800 Speaker 8: is symbolic, then it is we have troops there, We 277 00:14:38,880 --> 00:14:41,880 Speaker 8: have a bigger American presence generally speaking, and so I 278 00:14:41,880 --> 00:14:44,520 Speaker 8: think it's proodent for us to take non essential personnel 279 00:14:44,560 --> 00:14:46,320 Speaker 8: and give them the opportunity to leave. 280 00:14:46,360 --> 00:14:48,760 Speaker 7: But it's a it's a quality, it's something that we 281 00:14:48,800 --> 00:14:50,200 Speaker 7: need to look at. It's a factor. 282 00:14:50,240 --> 00:14:53,480 Speaker 8: It's a signal for thinking about, well, the United States 283 00:14:53,520 --> 00:14:55,280 Speaker 8: has starting to take precautionary measures. 284 00:14:55,760 --> 00:14:58,880 Speaker 6: Well, and how far in advance do we typically take those? 285 00:14:58,920 --> 00:15:01,400 Speaker 6: Does that signal that it could be within days what 286 00:15:01,440 --> 00:15:04,640 Speaker 6: we're talking about here, before Sunday, before Witcoff even gets 287 00:15:04,640 --> 00:15:07,400 Speaker 6: to theman to try to deal with things diplomatically. 288 00:15:07,480 --> 00:15:10,200 Speaker 8: So I have a feeling that Trump is probably said 289 00:15:10,280 --> 00:15:13,440 Speaker 8: to the Israelis, let what cough go in Sunday. But 290 00:15:13,600 --> 00:15:16,960 Speaker 8: I think it's very very soon, you know what. I 291 00:15:17,000 --> 00:15:20,760 Speaker 8: think the Israelis are also operationally ready. They made a 292 00:15:20,800 --> 00:15:24,480 Speaker 8: bunch of bombing runs down to hit the Huthi. The 293 00:15:24,480 --> 00:15:28,160 Speaker 8: way I understand that is they're able to practice some refueling. Certainly, 294 00:15:28,320 --> 00:15:32,360 Speaker 8: the distance that it takes to get down there otherwise 295 00:15:32,400 --> 00:15:35,960 Speaker 8: get into the nice right formations have some operational readiness 296 00:15:36,040 --> 00:15:41,320 Speaker 8: concerns addressed by that operation, so diplomatically, the air defenses 297 00:15:41,400 --> 00:15:46,120 Speaker 8: being down in Israel, the military and Israel being really ready, 298 00:15:46,800 --> 00:15:49,520 Speaker 8: you could read into this that something's going to happen soon. 299 00:15:49,920 --> 00:15:52,400 Speaker 2: You were a special Assistant for National Security in the 300 00:15:52,520 --> 00:15:55,800 Speaker 2: George W. Bush administration, would you be telling the president 301 00:15:55,840 --> 00:15:58,600 Speaker 2: now that there's still an opportunity for a diplomatic solution 302 00:15:58,840 --> 00:15:59,640 Speaker 2: or prepare for war. 303 00:16:00,240 --> 00:16:04,000 Speaker 8: I would say prepare for war, but that is the 304 00:16:04,040 --> 00:16:06,920 Speaker 8: moment at which you could have a diplomatic solution. 305 00:16:07,280 --> 00:16:09,640 Speaker 7: You got really really close up to the line. 306 00:16:09,640 --> 00:16:11,960 Speaker 8: So I would never rule it out completely, but I 307 00:16:12,000 --> 00:16:14,560 Speaker 8: definitely think the United States needs to be thinking through 308 00:16:14,560 --> 00:16:17,960 Speaker 8: and apparently we are. What would the third order, second 309 00:16:18,040 --> 00:16:20,160 Speaker 8: third order implications be. 310 00:16:20,480 --> 00:16:22,920 Speaker 7: Of this type of strike. It would be big. 311 00:16:23,440 --> 00:16:26,080 Speaker 8: Now Israel has got a lot of creative ways to 312 00:16:26,160 --> 00:16:30,520 Speaker 8: go after all these different sites across Iran, so this 313 00:16:30,560 --> 00:16:34,400 Speaker 8: could be a really multi day, maybe even multi week 314 00:16:34,960 --> 00:16:35,840 Speaker 8: type of operation. 315 00:16:36,440 --> 00:16:39,480 Speaker 6: We'll plan to stay in touch with you as things developed. 316 00:16:39,520 --> 00:16:42,160 Speaker 6: Michael Allen, Beacon Global Strategies, Thank you as always for 317 00:16:42,280 --> 00:16:44,240 Speaker 6: joining us as we continue to track this story for 318 00:16:44,360 --> 00:16:47,160 Speaker 6: you here on Bloomberg TV and Radio. One of just 319 00:16:47,200 --> 00:16:49,520 Speaker 6: many stories around the world we have our eye on today. 320 00:16:49,600 --> 00:16:53,480 Speaker 6: We're also watching, of course, a tragedy unfolding in India 321 00:16:53,720 --> 00:16:57,080 Speaker 6: after a crash a blowing seven eighty seven Dreamliner with 322 00:16:57,080 --> 00:17:00,000 Speaker 6: two hundred and forty two people aboard an Air India flight. 323 00:17:00,040 --> 00:17:02,640 Speaker 6: More than two hundred bodies have been recovered after that 324 00:17:02,760 --> 00:17:06,720 Speaker 6: aircraft crashed shortly after takeoff en route to London, and 325 00:17:06,720 --> 00:17:08,880 Speaker 6: we want to get the latest now from Ryan bean Bloomberg, 326 00:17:08,960 --> 00:17:12,159 Speaker 6: US Transport Deputy team leader, who's here with us on 327 00:17:12,240 --> 00:17:14,800 Speaker 6: balance of power. Ryan, do we have any indication yet, 328 00:17:14,840 --> 00:17:18,679 Speaker 6: knowing it's obviously very early into the investigation of what 329 00:17:18,880 --> 00:17:21,200 Speaker 6: actually went wrong here, what happened. 330 00:17:22,680 --> 00:17:25,840 Speaker 9: Unfortunately, no, we do not. This crash is just still 331 00:17:25,880 --> 00:17:30,000 Speaker 9: hours old. Recovery efforts are underway. The first phase of 332 00:17:30,560 --> 00:17:33,440 Speaker 9: a major disaster like this is largely dominated by search 333 00:17:33,480 --> 00:17:39,080 Speaker 9: and rescue and efforts. Investigators from the US and from 334 00:17:39,080 --> 00:17:42,480 Speaker 9: other countries are planning to travel to India to assist 335 00:17:42,560 --> 00:17:46,520 Speaker 9: with the local authorities and their National Aviation Safety Investigative 336 00:17:46,520 --> 00:17:49,400 Speaker 9: Team to begin that work. But that's going to still 337 00:17:49,480 --> 00:17:53,439 Speaker 9: take some time before we really learn what actually happened 338 00:17:53,480 --> 00:17:54,840 Speaker 9: in this tragedy. 339 00:17:54,800 --> 00:17:57,480 Speaker 2: Yeah, well, we're hearing a lot of speculation, as is 340 00:17:57,520 --> 00:17:59,760 Speaker 2: often the case. Ryan, the President of the United States, 341 00:18:00,040 --> 00:18:03,280 Speaker 2: at a podium a short time ago, suggested some sort 342 00:18:03,320 --> 00:18:06,600 Speaker 2: of engine failure, and there are eyes on Boeing, there 343 00:18:06,600 --> 00:18:11,040 Speaker 2: are eyes on GE with the potential for major implications. 344 00:18:11,080 --> 00:18:14,879 Speaker 2: Boeing CEO, though, says the company's team stands ready to 345 00:18:14,920 --> 00:18:18,679 Speaker 2: support the investigation. I wonder to what extent the NTSB 346 00:18:18,840 --> 00:18:21,440 Speaker 2: will be involved here, knowing that it happened in another country. 347 00:18:22,720 --> 00:18:26,760 Speaker 9: They will be involved under Annex thirteen the home country 348 00:18:27,119 --> 00:18:34,840 Speaker 9: where an aircraft crash occurs. They take the lead, but 349 00:18:35,000 --> 00:18:40,000 Speaker 9: they are supported by their counterparts from countries where where 350 00:18:40,040 --> 00:18:44,159 Speaker 9: aircraft are manufactured and where engines are manufactured. So the NTS, 351 00:18:43,560 --> 00:18:48,159 Speaker 9: being the sort of pre eminent global authority on these 352 00:18:48,240 --> 00:18:51,560 Speaker 9: types of investigations, will absolutely have a role, as will Boeing, 353 00:18:51,920 --> 00:18:55,800 Speaker 9: and as will personnel from General GE who have said 354 00:18:55,800 --> 00:18:59,480 Speaker 9: that they're both sending personnel to assist and they stand 355 00:18:59,520 --> 00:19:00,560 Speaker 9: ready to help the authorities. 356 00:19:02,240 --> 00:19:04,639 Speaker 6: Yeah, we just had headlines crossing the Bloomberg terminal that 357 00:19:04,680 --> 00:19:07,439 Speaker 6: the CEO of Boeing has spoken to the chair of 358 00:19:07,520 --> 00:19:11,000 Speaker 6: Air India saying that Boeing's team stands ready to support 359 00:19:11,240 --> 00:19:15,520 Speaker 6: the investigation. When we consider this Boeing aircraft specifically, Ryan, 360 00:19:15,640 --> 00:19:18,680 Speaker 6: knowing all of the difficulty that Boeing has had specifically 361 00:19:18,680 --> 00:19:22,919 Speaker 6: with the seven thirty seven model after several fatal crashes 362 00:19:22,960 --> 00:19:26,080 Speaker 6: and of course the blowout of one part of the 363 00:19:26,119 --> 00:19:30,280 Speaker 6: aircraft last year on that flight in the US, talk 364 00:19:30,320 --> 00:19:33,000 Speaker 6: to us about the seven eighty seven. This is obviously 365 00:19:33,000 --> 00:19:35,879 Speaker 6: a wide body aircraft. What is its track record? How 366 00:19:35,920 --> 00:19:38,640 Speaker 6: reliable is this aircraft? Has Boeing had issues with this 367 00:19:38,720 --> 00:19:39,119 Speaker 6: model in. 368 00:19:39,119 --> 00:19:44,040 Speaker 9: The past, This aircraft has had heretofore a sterling track record. 369 00:19:44,119 --> 00:19:46,920 Speaker 9: This is the first fatal accident involving a seven eighty 370 00:19:46,960 --> 00:19:49,600 Speaker 9: seven and this model of aircraft has been on the 371 00:19:49,600 --> 00:19:52,920 Speaker 9: market for about fifteen years. There are over a thousand 372 00:19:53,280 --> 00:19:56,880 Speaker 9: in service today. It has it's a. 373 00:19:56,920 --> 00:19:59,119 Speaker 7: Workhorse for global. 374 00:19:58,720 --> 00:20:03,640 Speaker 9: Airline fleets connecting international destination around the world. So this 375 00:20:03,720 --> 00:20:06,680 Speaker 9: is uh, this is sort of uncharted territory. 376 00:20:07,000 --> 00:20:07,200 Speaker 5: Now. 377 00:20:07,440 --> 00:20:09,960 Speaker 9: The seven eighty seven has been under scrutiny for some 378 00:20:10,080 --> 00:20:12,960 Speaker 9: quality concerns on the part of the FAA in recent 379 00:20:13,040 --> 00:20:19,919 Speaker 9: years that prompted about a year plus halts to deliveries 380 00:20:19,960 --> 00:20:24,200 Speaker 9: while Boeing employees, you know, reworked elements of the fuselage 381 00:20:24,359 --> 00:20:27,320 Speaker 9: that the FAA was concerned work being the work wasn't 382 00:20:27,359 --> 00:20:29,800 Speaker 9: being properly done on it, But those planes have largely 383 00:20:29,840 --> 00:20:33,960 Speaker 9: been through that process. Deliveries have resumed, and there has 384 00:20:34,040 --> 00:20:39,359 Speaker 9: not been a major stafety incident involving the plane itself. 385 00:20:39,480 --> 00:20:41,880 Speaker 9: So this is sort of uncharted territory. And you mentioned 386 00:20:42,400 --> 00:20:46,240 Speaker 9: you know, Boeing's you know, recent track record and the 387 00:20:46,280 --> 00:20:49,760 Speaker 9: previous incidents that they've been involved in. This certainly doesn't 388 00:20:49,800 --> 00:20:53,679 Speaker 9: help what Boeing's trying to do right now, which is 389 00:20:53,960 --> 00:21:00,360 Speaker 9: get quality under control, you know, resumed deliveries, get cash 390 00:21:00,359 --> 00:21:04,840 Speaker 9: flows bigot going. We don't know, again to emphasize, we 391 00:21:04,880 --> 00:21:07,080 Speaker 9: don't know if there is any issue with this plane whatsoever, 392 00:21:07,200 --> 00:21:09,119 Speaker 9: or if there are other factors that play here, but 393 00:21:09,520 --> 00:21:13,679 Speaker 9: you certainly it certainly doesn't help the company and CEO 394 00:21:13,760 --> 00:21:20,160 Speaker 9: Kelly Orberg in trying to move Boeing beyond the difficult 395 00:21:20,200 --> 00:21:23,520 Speaker 9: chapter that it's been in for the last several years. 396 00:21:24,200 --> 00:21:27,240 Speaker 2: Yeah, timing is terrible for these companies all the way around. Ryan, 397 00:21:27,240 --> 00:21:31,080 Speaker 2: Thank you so much. Ryan Bean is Bloomberg's US Transport 398 00:21:31,200 --> 00:21:36,240 Speaker 2: deputy team leader with his eyes on a developing story overseas. 399 00:21:36,280 --> 00:21:39,159 Speaker 2: I'm Joe Matthew alongside Kaylee Lines. We'll keep tabs on 400 00:21:39,200 --> 00:21:42,679 Speaker 2: this as well as the IPO of Chime. A conversation 401 00:21:42,840 --> 00:21:46,800 Speaker 2: later with Paige Smith, our finance reporter, Consumer finance looming 402 00:21:46,840 --> 00:21:49,000 Speaker 2: large today on Wall Street, and we'll have more on 403 00:21:49,040 --> 00:21:50,440 Speaker 2: that straight ahead on Bloomberg. 404 00:21:53,720 --> 00:21:57,200 Speaker 1: You're listening to the Bloomberg Balance of Power podcast. Catch 405 00:21:57,240 --> 00:22:00,680 Speaker 1: us live weekdays at noon and five pm Easter on Apple, 406 00:22:00,760 --> 00:22:04,119 Speaker 1: Cocklay and Android Auto with the Bloomberg Business App. Listen 407 00:22:04,160 --> 00:22:07,280 Speaker 1: on demand wherever you get your podcasts, or watch us 408 00:22:07,320 --> 00:22:08,679 Speaker 1: live on YouTube. 409 00:22:10,040 --> 00:22:12,720 Speaker 6: Kaylee Lines alongside Joe Matthew for Balance of Power today, 410 00:22:12,720 --> 00:22:15,200 Speaker 6: and as Charlie checks on Chime for us of course 411 00:22:15,280 --> 00:22:17,720 Speaker 6: doing pretty well on its first day of trading, having 412 00:22:17,840 --> 00:22:21,480 Speaker 6: already had its IPO priced above the marketed range, opening 413 00:22:21,720 --> 00:22:24,439 Speaker 6: substantially a forty nine percent above that price, even if 414 00:22:24,480 --> 00:22:27,200 Speaker 6: we're trading a little below that level now at thirty 415 00:22:27,200 --> 00:22:29,320 Speaker 6: eight dollars a share. As Charlie was just mentioning, but 416 00:22:29,359 --> 00:22:31,679 Speaker 6: this is just the latest in what have been a 417 00:22:31,720 --> 00:22:36,320 Speaker 6: series of relatively successful IPOs, thinking back to Circle last week, Joe, 418 00:22:36,400 --> 00:22:38,159 Speaker 6: and of course all of it, keeping our focus on 419 00:22:38,560 --> 00:22:41,119 Speaker 6: financial technology in the fintech space. 420 00:22:40,920 --> 00:22:42,159 Speaker 3: Really compelling stories. 421 00:22:42,200 --> 00:22:45,159 Speaker 2: The CEO at Chime, Chris Britt, was talking to Ed 422 00:22:45,240 --> 00:22:47,960 Speaker 2: Ludlow earlier today on Bloomberg TV and Radio. Just a 423 00:22:47,960 --> 00:22:50,920 Speaker 2: fascinating story about how we got here and why there's 424 00:22:50,920 --> 00:22:56,800 Speaker 2: so much buzz around it, fee free banking, payments driven revenue, 425 00:22:57,240 --> 00:23:00,840 Speaker 2: and an audience that may not typically be banked. As 426 00:23:00,880 --> 00:23:04,359 Speaker 2: they say, there's a really interesting trend here with many 427 00:23:04,400 --> 00:23:07,600 Speaker 2: people who are of lower income, lower means, living paycheck 428 00:23:07,640 --> 00:23:10,160 Speaker 2: to paycheck, but suddenly have a platform that they can 429 00:23:10,200 --> 00:23:11,880 Speaker 2: do business on here, and we wanted to talk about 430 00:23:11,880 --> 00:23:14,879 Speaker 2: it with Paige Smith, Bloomberg's consumer finance reporter. So you 431 00:23:14,960 --> 00:23:18,480 Speaker 2: get a slightly different wrinkle on this story page. A 432 00:23:18,560 --> 00:23:20,920 Speaker 2: third of the customers are women. What does this tell 433 00:23:20,960 --> 00:23:24,560 Speaker 2: us about the state of the consumer and its relationship 434 00:23:24,600 --> 00:23:25,080 Speaker 2: to banking. 435 00:23:25,680 --> 00:23:29,480 Speaker 10: I think that's a really good point. This company in particular, 436 00:23:29,560 --> 00:23:31,880 Speaker 10: which to be clear, is not a bank, but offers 437 00:23:31,960 --> 00:23:33,879 Speaker 10: a heck of a lot of bank like services to 438 00:23:34,000 --> 00:23:37,160 Speaker 10: consumers that, like you said, mostly make under one hundred 439 00:23:37,240 --> 00:23:40,720 Speaker 10: thousand dollars a year and are turning to this financial 440 00:23:40,760 --> 00:23:44,840 Speaker 10: technology company, as you know, for things like bread and butter, 441 00:23:45,000 --> 00:23:48,920 Speaker 10: savings accounts and checking accounts and places to put their paycheck, 442 00:23:49,960 --> 00:23:52,400 Speaker 10: and as you said, it caters to folks that are 443 00:23:53,240 --> 00:23:55,880 Speaker 10: you know, maybe would would go to a Bank of America, 444 00:23:56,040 --> 00:23:59,200 Speaker 10: would go to a Wells Fargo, but is actually there 445 00:23:59,440 --> 00:24:00,600 Speaker 10: instead going to try. 446 00:24:02,320 --> 00:24:02,520 Speaker 5: Well. 447 00:24:02,520 --> 00:24:04,240 Speaker 6: And to your point about this not being a bank, 448 00:24:04,359 --> 00:24:06,520 Speaker 6: just a fintech firm that partners with banks in order 449 00:24:06,560 --> 00:24:09,360 Speaker 6: to offer these services, is there a kind of regulatory 450 00:24:09,480 --> 00:24:12,640 Speaker 6: risk embedded in this story page? Is there a risk 451 00:24:12,720 --> 00:24:15,520 Speaker 6: that that kind of relationship actually gets more difficult for 452 00:24:15,600 --> 00:24:18,240 Speaker 6: Chime to execute and specifically make money off of. 453 00:24:18,760 --> 00:24:22,639 Speaker 10: Well, I would say to use Chris Britzworts. You know, 454 00:24:22,720 --> 00:24:26,840 Speaker 10: he has said repeatedly that the company has prioritized playing 455 00:24:26,880 --> 00:24:29,399 Speaker 10: by the rules. But you know, again, they are not 456 00:24:29,480 --> 00:24:33,080 Speaker 10: a bank. They work very closely with banks. They have 457 00:24:33,119 --> 00:24:36,080 Speaker 10: two bank partners stride in a bank or bank, and 458 00:24:36,720 --> 00:24:40,879 Speaker 10: you know, it's it's These relationships are common in the 459 00:24:40,920 --> 00:24:44,399 Speaker 10: fintech space, and yes, regulators have looked at them in 460 00:24:44,440 --> 00:24:48,399 Speaker 10: the past, but they have not looked at Chime in particular, 461 00:24:48,440 --> 00:24:52,240 Speaker 10: I believe, and this is it's certainly something to keep 462 00:24:52,280 --> 00:24:56,080 Speaker 10: in mind, but I don't I would say that just 463 00:24:56,119 --> 00:24:57,720 Speaker 10: to be clear, they are not a bank, but they're 464 00:24:57,760 --> 00:25:01,040 Speaker 10: a fintech that provides bank like services, works closely with them, and. 465 00:25:01,040 --> 00:25:03,760 Speaker 2: They're to give it the big banks a run for 466 00:25:03,800 --> 00:25:06,119 Speaker 2: their money. Here, when you start hearing about Chime in 467 00:25:06,160 --> 00:25:09,640 Speaker 2: the same conversation as Bank of America or JP Morgan Chase, 468 00:25:09,640 --> 00:25:11,840 Speaker 2: what does that tell us about the potential headroom for 469 00:25:11,880 --> 00:25:12,720 Speaker 2: this company to grow? 470 00:25:13,160 --> 00:25:15,480 Speaker 10: They've said they have. They're eyeing a number of different 471 00:25:15,480 --> 00:25:19,560 Speaker 10: revenue opportunities. But the company is, as they've made very clear, 472 00:25:19,600 --> 00:25:24,520 Speaker 10: they are payments revenue focused company. So they basically make 473 00:25:24,600 --> 00:25:28,200 Speaker 10: money every time their customers use their Chime branded credit 474 00:25:28,280 --> 00:25:30,520 Speaker 10: or debit cards. That's how they make money. It's a 475 00:25:30,560 --> 00:25:33,240 Speaker 10: little bit different than how your standard Bank of America 476 00:25:33,320 --> 00:25:36,760 Speaker 10: or wellsbargo makes money. And as they've said, there's more 477 00:25:36,800 --> 00:25:40,040 Speaker 10: opportunity to sort of take some of those existing customers 478 00:25:40,040 --> 00:25:42,440 Speaker 10: away from the biggest banks, but also expand on folks 479 00:25:42,480 --> 00:25:45,080 Speaker 10: who have maybe never had a relationship with a bank 480 00:25:45,080 --> 00:25:45,680 Speaker 10: of any kind. 481 00:25:47,040 --> 00:25:50,000 Speaker 6: All right, page, we appreciate it. Bloomberg Consumer finance reporter 482 00:25:50,119 --> 00:25:53,560 Speaker 6: Paige Smith reporting on Schime's IPO again the debut of trading. 483 00:25:54,440 --> 00:25:58,040 Speaker 6: It has been trading just under an hour. C HYM 484 00:25:58,200 --> 00:26:00,679 Speaker 6: is the ticker we're at thirty eight dollars and seventy 485 00:26:00,680 --> 00:26:02,879 Speaker 6: five cents a share after an IPO which again priced 486 00:26:02,920 --> 00:26:05,280 Speaker 6: at the beyond the upper end of the range at 487 00:26:05,280 --> 00:26:08,359 Speaker 6: twenty seven dollars a share. So very healthy debut pop. 488 00:26:08,400 --> 00:26:10,560 Speaker 6: We are seeing for chime here and as we keep 489 00:26:10,600 --> 00:26:12,800 Speaker 6: one eye on the Nasdaq and on Wall Street overall, 490 00:26:12,840 --> 00:26:14,880 Speaker 6: of course, we're keeping another eye on the happenings here 491 00:26:14,920 --> 00:26:17,080 Speaker 6: in Washington, including a meeting that will happen at the 492 00:26:17,080 --> 00:26:20,239 Speaker 6: White House later this afternoon between President Trump and two 493 00:26:20,400 --> 00:26:23,400 Speaker 6: very important people in the budget reconciliation debate right now, 494 00:26:23,400 --> 00:26:26,359 Speaker 6: the Senate Majority Leader John Thune and the Senate Finance 495 00:26:26,440 --> 00:26:29,439 Speaker 6: Chairman Mike Crapo, who, of course Joe is charged with 496 00:26:29,560 --> 00:26:33,880 Speaker 6: making any tweaks to the tax policies and medicaid policies 497 00:26:33,920 --> 00:26:36,119 Speaker 6: specifically of the House past reconciliation. 498 00:26:36,200 --> 00:26:38,320 Speaker 2: Yeah, all the fun stuff here that's going to upset 499 00:26:38,320 --> 00:26:39,879 Speaker 2: everyone in the House is going to probably come out 500 00:26:39,880 --> 00:26:42,359 Speaker 2: of the Senate Finance Committee. So they do have some 501 00:26:42,440 --> 00:26:44,359 Speaker 2: things to talk about here, and it's great to be 502 00:26:44,440 --> 00:26:46,720 Speaker 2: joined by somebody who knows a thing or two about this. 503 00:26:47,560 --> 00:26:50,880 Speaker 2: Patrick McHenry is back with us Bloomberg Politics, contributor of course, 504 00:26:50,880 --> 00:26:53,879 Speaker 2: former Chair of the House Financial Services Committee, former Speaker 505 00:26:53,880 --> 00:26:54,240 Speaker 2: pro Ten. 506 00:26:54,320 --> 00:26:55,560 Speaker 7: Great to see you, Great to see you. 507 00:26:55,600 --> 00:26:59,800 Speaker 11: I'm smiling because yes, the natural at tension between the 508 00:26:59,800 --> 00:27:02,359 Speaker 11: House else in the Senate will be highlighted in the 509 00:27:02,400 --> 00:27:02,880 Speaker 11: coming week. 510 00:27:02,960 --> 00:27:03,760 Speaker 3: I bet that's right. 511 00:27:04,280 --> 00:27:06,960 Speaker 2: You know, we've talked about permanence a lot lately, Kaylee 512 00:27:06,960 --> 00:27:08,800 Speaker 2: and I and whether that's going to tip the cart 513 00:27:08,840 --> 00:27:11,159 Speaker 2: over if you make these cuts permanent, you got to 514 00:27:11,160 --> 00:27:13,040 Speaker 2: find the money somewhere. If it comes out of salt, 515 00:27:13,040 --> 00:27:15,439 Speaker 2: that we're dead in the water. Is the conventional wisdom 516 00:27:15,520 --> 00:27:18,400 Speaker 2: right here? Or would you be very hard pressed. 517 00:27:18,080 --> 00:27:20,359 Speaker 3: To find a Republican who votes for a tax hike. 518 00:27:21,160 --> 00:27:23,560 Speaker 11: You're hard pressed to find a Republican for a tax hike. 519 00:27:23,600 --> 00:27:27,040 Speaker 11: But we've got narrow majorities here. You see the tension 520 00:27:27,080 --> 00:27:30,719 Speaker 11: between the White House and Senator Ran Paul highlighted that 521 00:27:31,119 --> 00:27:34,680 Speaker 11: he would otherwise be for a tax cut, but because 522 00:27:34,720 --> 00:27:37,800 Speaker 11: the debt ceilings included, he won't play ball. That makes 523 00:27:37,800 --> 00:27:40,640 Speaker 11: it more precarious for the Senate to produce a reasonable 524 00:27:40,640 --> 00:27:45,560 Speaker 11: tax package. Probably means less tax cuts in fact, because 525 00:27:45,600 --> 00:27:50,399 Speaker 11: he's not participating, more spending overall. Because he's not participating. 526 00:27:50,440 --> 00:27:53,200 Speaker 11: That's quite frustrating when you're trying to make policy and 527 00:27:54,080 --> 00:27:59,199 Speaker 11: actually have a more physically sound outcome. But I do 528 00:27:59,320 --> 00:28:02,320 Speaker 11: think you're look looking at permanence as a baseline conversation 529 00:28:02,359 --> 00:28:04,800 Speaker 11: for the Senate. I think that is a net plus 530 00:28:05,359 --> 00:28:09,000 Speaker 11: the fact that we have a tax cod that's expiring 531 00:28:09,160 --> 00:28:13,240 Speaker 11: for individuals, and individuals are facing in small businesses facing 532 00:28:13,240 --> 00:28:16,640 Speaker 11: a massive tax increase. Secretary Bessett said it very well 533 00:28:16,680 --> 00:28:20,480 Speaker 11: before the before the Congress this week. This could be 534 00:28:20,520 --> 00:28:23,480 Speaker 11: the largest tax increase in American history. So action is 535 00:28:24,320 --> 00:28:28,960 Speaker 11: really is quite necessary for economic growth and economic activity. 536 00:28:29,040 --> 00:28:33,200 Speaker 11: The debate has gotten become an abstraction from that fact point, 537 00:28:33,280 --> 00:28:36,160 Speaker 11: which they're trying to draw it back to those really 538 00:28:36,240 --> 00:28:37,159 Speaker 11: basic principles. 539 00:28:37,280 --> 00:28:39,840 Speaker 6: Yeah, and yet the debate has migrated onto very specific, 540 00:28:39,960 --> 00:28:42,560 Speaker 6: narrow issues like the state and local tax deduction, which 541 00:28:42,560 --> 00:28:45,960 Speaker 6: affects just a handful of lawmakers in the House who 542 00:28:46,000 --> 00:28:49,360 Speaker 6: happen to have read state or red districts in a 543 00:28:49,400 --> 00:28:52,280 Speaker 6: blue state. Mike Johnson was asked when he was leaving 544 00:28:52,320 --> 00:28:54,480 Speaker 6: the White House about salt changes, and he says he 545 00:28:54,520 --> 00:28:57,320 Speaker 6: hopes the Senate changes it in a very small way. 546 00:28:57,920 --> 00:29:00,240 Speaker 6: How do we translate? He'll speak very small way into 547 00:29:00,240 --> 00:29:03,320 Speaker 6: an actual number. Reducing that amount by ten thousand dollars, 548 00:29:03,360 --> 00:29:04,760 Speaker 6: for example, be considered very small. 549 00:29:04,800 --> 00:29:06,840 Speaker 11: They're going to risk it, Okay, the Senate, it's going 550 00:29:06,840 --> 00:29:09,320 Speaker 11: to test it. This is a massive So when you 551 00:29:09,360 --> 00:29:12,480 Speaker 11: see the scoring. There are two pieces of the debate 552 00:29:12,560 --> 00:29:16,840 Speaker 11: right now. Is that there is those on the lower 553 00:29:16,920 --> 00:29:19,720 Speaker 11: end of the scale are going to see their net 554 00:29:19,840 --> 00:29:24,000 Speaker 11: benefits from government be reduced, and at the top end 555 00:29:24,040 --> 00:29:26,520 Speaker 11: of the scale, you're going to see a greater tax cut. 556 00:29:27,120 --> 00:29:30,480 Speaker 11: That is driven around salts, and a debate about medicaid. 557 00:29:31,000 --> 00:29:33,840 Speaker 11: If you are working poor and you're not on medicaid, 558 00:29:34,320 --> 00:29:37,600 Speaker 11: this is a tax cut for you. If you're receiving 559 00:29:37,640 --> 00:29:40,840 Speaker 11: medicaid and you're gaming the system, yes, that's a huge loss. 560 00:29:40,960 --> 00:29:42,360 Speaker 7: So work requirements are. 561 00:29:42,280 --> 00:29:45,520 Speaker 11: Always going to skew. Is this is this you're cutting people. 562 00:29:46,000 --> 00:29:48,200 Speaker 11: What you're saying is if you're able bodied, you should 563 00:29:48,200 --> 00:29:53,240 Speaker 11: not be on governmental services. So that becomes a point 564 00:29:53,240 --> 00:29:56,480 Speaker 11: of debate. The second piece of that is the salt deduction. 565 00:29:57,000 --> 00:30:00,680 Speaker 11: A salt deduction has the greatest impact on the higher 566 00:30:00,800 --> 00:30:05,200 Speaker 11: end of the distribution for high income individuals in blue states. 567 00:30:05,640 --> 00:30:08,800 Speaker 11: The reason why we have the AsSalt deduction at ten 568 00:30:08,840 --> 00:30:11,160 Speaker 11: thousand dollars capped at ten thousand dollars for the first 569 00:30:11,200 --> 00:30:14,440 Speaker 11: time in American history. Is because in twenty seventeen, Republicans 570 00:30:14,440 --> 00:30:19,800 Speaker 11: had sufficient votes to go beyond blue state Republicans in 571 00:30:19,840 --> 00:30:22,640 Speaker 11: the House. This time around, that is not the case. 572 00:30:23,000 --> 00:30:25,360 Speaker 11: The Republican majority in the House is driven out of 573 00:30:25,720 --> 00:30:30,959 Speaker 11: Republicans from New Jersey and New York without them. Hakeem 574 00:30:31,000 --> 00:30:33,880 Speaker 11: Jeffries a Speaker of the House, not Mike Johnson, so 575 00:30:33,920 --> 00:30:37,320 Speaker 11: they do they do have a serious role here. The 576 00:30:37,360 --> 00:30:43,360 Speaker 11: Senate cares not one whit this debate. So the tension 577 00:30:43,400 --> 00:30:45,880 Speaker 11: here is going to be a lot of performative acts 578 00:30:46,400 --> 00:30:50,080 Speaker 11: around what is actually going to happen. I think we 579 00:30:50,120 --> 00:30:53,160 Speaker 11: can fast forward here. This is going to be basically 580 00:30:53,240 --> 00:30:55,360 Speaker 11: the House trying to be the sheep dog to steer 581 00:30:55,440 --> 00:30:59,640 Speaker 11: the Senate, steer the Senate to a package that the 582 00:30:59,680 --> 00:31:03,360 Speaker 11: South that the House will consume and pass and put 583 00:31:03,360 --> 00:31:06,240 Speaker 11: to the presence desk. That is actually what we're hearing 584 00:31:06,320 --> 00:31:08,440 Speaker 11: here between congressional leaders. 585 00:31:08,120 --> 00:31:10,640 Speaker 2: The House as sheep dog, not the Senate jamming the House. 586 00:31:11,200 --> 00:31:16,520 Speaker 11: Well, this is assuming the jam yeah, and trying. 587 00:31:16,240 --> 00:31:18,640 Speaker 7: To assume the gym, trying to limit. 588 00:31:18,400 --> 00:31:21,880 Speaker 11: The jym, try to massage the productage the gym such. 589 00:31:21,840 --> 00:31:23,720 Speaker 7: That you can consume the jam. 590 00:31:23,880 --> 00:31:27,840 Speaker 11: Okay, wow, this is matahan is a lot No, all right, 591 00:31:27,920 --> 00:31:30,080 Speaker 11: but this is much more of a Friday afternoon conversation. 592 00:31:30,240 --> 00:31:31,680 Speaker 3: Let's make sorry, I'll take it that way. 593 00:31:31,840 --> 00:31:34,720 Speaker 2: Bring us inside the minds of the Salt Caucus. You 594 00:31:34,840 --> 00:31:39,280 Speaker 2: remember from New York. You're a tough guy. Hell no, 595 00:31:39,560 --> 00:31:42,680 Speaker 2: is what we're hearing. Not a dollar less than forty 596 00:31:42,720 --> 00:31:45,480 Speaker 2: thousand dollars. You dealt with this all the time, though, 597 00:31:45,480 --> 00:31:48,000 Speaker 2: how much of this is bluster when you're alone in 598 00:31:48,000 --> 00:31:48,320 Speaker 2: a room? 599 00:31:48,360 --> 00:31:49,920 Speaker 3: Are we really voting for the taxi? 600 00:31:49,920 --> 00:31:51,920 Speaker 2: Like, if you bring this down to thirty thousand dollars, 601 00:31:52,520 --> 00:31:55,440 Speaker 2: maybe you're gonna tell me yes, because you can't primary 602 00:31:55,520 --> 00:31:56,680 Speaker 2: them with a maga candidate. 603 00:31:56,840 --> 00:32:00,960 Speaker 11: Okay, So the difficulty here is, if you're a Republican 604 00:32:01,480 --> 00:32:04,160 Speaker 11: and you're in the New York media market, you are 605 00:32:04,280 --> 00:32:09,280 Speaker 11: one of the most sound active politicians you can possibly be. 606 00:32:09,840 --> 00:32:12,360 Speaker 11: You've been put through a meat grinder. You know what 607 00:32:12,400 --> 00:32:15,640 Speaker 11: it's like to have the media blaring at you and 608 00:32:15,680 --> 00:32:19,120 Speaker 11: to be like a unicorn in this space. So they're 609 00:32:19,280 --> 00:32:22,360 Speaker 11: professional and how they're taking this. They're going to fight 610 00:32:22,760 --> 00:32:25,640 Speaker 11: for as high a deduction as they possibly can because 611 00:32:25,640 --> 00:32:29,320 Speaker 11: it benefits their constituents, that's really, and therefore benefits their 612 00:32:29,360 --> 00:32:34,080 Speaker 11: politics and re electability. And they are really proficient in 613 00:32:34,200 --> 00:32:37,600 Speaker 11: how they act. They're sticking together and they know how 614 00:32:37,640 --> 00:32:40,160 Speaker 11: to negotiate. So is it going to be thirty thousand 615 00:32:40,200 --> 00:32:41,960 Speaker 11: dollars or is it going to be some number between 616 00:32:42,040 --> 00:32:43,000 Speaker 11: thirty and forty? 617 00:32:43,360 --> 00:32:44,320 Speaker 7: We're going to see. 618 00:32:44,560 --> 00:32:46,600 Speaker 11: But there's going to be a lot of performance between 619 00:32:46,600 --> 00:32:49,080 Speaker 11: now and then, and a lot of heartache before the 620 00:32:49,160 --> 00:32:49,960 Speaker 11: vote as well. 621 00:32:50,280 --> 00:32:50,440 Speaker 8: Well. 622 00:32:50,480 --> 00:32:53,080 Speaker 6: In between now and then, there's other legislative efforts underway 623 00:32:53,120 --> 00:32:55,080 Speaker 6: on the Hill and in the House specifically where we 624 00:32:55,120 --> 00:32:57,280 Speaker 6: saw a markup this week of the Clarity Act. This 625 00:32:57,440 --> 00:33:01,680 Speaker 6: is the long awaited market structure and iteration, shall we say, 626 00:33:01,680 --> 00:33:03,960 Speaker 6: of the Fit twenty one Act that passed while you 627 00:33:04,000 --> 00:33:07,120 Speaker 6: were still in the Chamber trying to delineate authority between 628 00:33:07,120 --> 00:33:08,440 Speaker 6: the SEC and CFTC. 629 00:33:08,480 --> 00:33:08,760 Speaker 10: Here. 630 00:33:09,080 --> 00:33:11,200 Speaker 6: Some concerns are being raised about this though, and I 631 00:33:11,240 --> 00:33:14,280 Speaker 6: wonder how you view the prospects, specifically the prospects of 632 00:33:14,320 --> 00:33:16,600 Speaker 6: ultimately reconciling it with whatever the Senate would like to do. 633 00:33:17,040 --> 00:33:21,320 Speaker 11: So a French Hill constructed with this Market Structure Bill 634 00:33:21,320 --> 00:33:23,760 Speaker 11: in the House took what we did last Congress, built 635 00:33:23,760 --> 00:33:26,480 Speaker 11: on it, refined it. I think it's a better product, 636 00:33:26,840 --> 00:33:29,280 Speaker 11: and much more balanced product than it was last Congress, 637 00:33:30,320 --> 00:33:32,760 Speaker 11: and durable. I mean, this is a set of policy 638 00:33:32,800 --> 00:33:36,080 Speaker 11: that can make its way unchanged, signed in law. What 639 00:33:36,120 --> 00:33:40,440 Speaker 11: we saw with a markup yesterday is that the actions 640 00:33:40,560 --> 00:33:44,400 Speaker 11: of the Trump family engaged in crypto has made it 641 00:33:44,520 --> 00:33:48,880 Speaker 11: very difficult for pro crypto Democratic members to participate in 642 00:33:48,960 --> 00:33:53,440 Speaker 11: the policy making here. So you saw complete performative acts 643 00:33:53,480 --> 00:33:57,680 Speaker 11: around the president's family and their actions in crypto. That 644 00:33:57,840 --> 00:33:59,800 Speaker 11: was what the whole market was about, not about the 645 00:34:00,360 --> 00:34:03,400 Speaker 11: the policy or some concern about the substance of the policy, 646 00:34:03,520 --> 00:34:07,120 Speaker 11: but it was all about the politics of the Democratic 647 00:34:07,200 --> 00:34:11,560 Speaker 11: politicians visa vis the president and the president's family. That 648 00:34:11,600 --> 00:34:14,960 Speaker 11: tells me it's not actually the legislation that's the problem. 649 00:34:15,120 --> 00:34:18,200 Speaker 11: It's going to be giving Democratic members enough cover that 650 00:34:18,239 --> 00:34:20,799 Speaker 11: they can actually participate and cast the votes they want 651 00:34:20,840 --> 00:34:23,360 Speaker 11: to participate. And there are a lot of Democratic members 652 00:34:23,360 --> 00:34:26,800 Speaker 11: at the House and the Senate that want to do that. Still, 653 00:34:27,120 --> 00:34:30,960 Speaker 11: we saw sixty nine Democratic votes in the Senate, very 654 00:34:31,000 --> 00:34:34,600 Speaker 11: high vote total for the for the Stable Quinn bill. 655 00:34:34,840 --> 00:34:38,240 Speaker 11: I think the pairing of those two is inevitable post 656 00:34:38,239 --> 00:34:42,120 Speaker 11: tax bill, and I think those two getting pushed together 657 00:34:42,239 --> 00:34:44,279 Speaker 11: as a single vote to go to a single bill 658 00:34:44,320 --> 00:34:48,279 Speaker 11: to the President's desk is the most reasonable outcome of 659 00:34:48,320 --> 00:34:48,840 Speaker 11: this summer. 660 00:34:49,200 --> 00:34:51,879 Speaker 6: So post tax bill, meaning it happens this fall. 661 00:34:52,440 --> 00:34:56,279 Speaker 11: No, I basically or really, I'm a I think what 662 00:34:56,360 --> 00:34:59,520 Speaker 11: we're going to see is a major push to take 663 00:34:59,560 --> 00:35:03,680 Speaker 11: the Senate tax bill through the House before fourth of July, 664 00:35:04,239 --> 00:35:07,560 Speaker 11: and then July becomes crypto month. You can the president 665 00:35:07,640 --> 00:35:08,759 Speaker 11: have a bill at the end of the month. 666 00:35:09,000 --> 00:35:13,200 Speaker 3: Wow, we just named July crypto month. Fantastic. Patrick McHenry, 667 00:35:13,200 --> 00:35:13,799 Speaker 3: thank you so much. 668 00:35:13,840 --> 00:35:15,239 Speaker 2: I didn't get a chance to ask you what would 669 00:35:15,239 --> 00:35:18,080 Speaker 2: happen at the Congressional dinner tonight at the White House. 670 00:35:18,160 --> 00:35:19,520 Speaker 3: We'll do that next time you're with us. 671 00:35:20,000 --> 00:35:22,880 Speaker 2: The great Patrick McHenry, Bloomberg Politics contributor see on the 672 00:35:22,920 --> 00:35:27,480 Speaker 2: late edition of Ballance of Power. Thanks for listening to 673 00:35:27,520 --> 00:35:30,920 Speaker 2: the Balance of Power podcast. Make sure to subscribe if 674 00:35:30,920 --> 00:35:33,640 Speaker 2: you haven't already, at Apple, Spotify, or wherever you get 675 00:35:33,680 --> 00:35:36,720 Speaker 2: your podcasts, and you can find us live every weekday 676 00:35:36,719 --> 00:35:40,520 Speaker 2: from Washington, DC at noontime Eastern at Bloomberg dot com.