1 00:00:02,520 --> 00:00:13,760 Speaker 1: Bloomberg Audio Studios, podcasts, radio news. This is the Bloomberg 2 00:00:13,840 --> 00:00:17,920 Speaker 1: Surveillance Podcast. Catch us live weekdays at seven am Eastern 3 00:00:18,200 --> 00:00:22,000 Speaker 1: on Apple CarPlay or Android Auto with the Bloomberg Business App. 4 00:00:22,320 --> 00:00:25,680 Speaker 1: Listen on demand wherever you get your podcasts, or watch 5 00:00:25,760 --> 00:00:26,920 Speaker 1: us live on YouTube. 6 00:00:26,920 --> 00:00:30,320 Speaker 2: Bloomberg Surveillance is about conversation. That's the way we do it. 7 00:00:30,480 --> 00:00:33,880 Speaker 2: Right now, joining us without question or interview of the day. 8 00:00:33,920 --> 00:00:38,160 Speaker 2: Steven Englander with earn credit, the standard charter at Bank, 9 00:00:38,240 --> 00:00:41,360 Speaker 2: definitive at City Group for years on cross rates, absolutely 10 00:00:41,400 --> 00:00:45,320 Speaker 2: known globally for the relationships and currency show. I want 11 00:00:45,320 --> 00:00:47,680 Speaker 2: to cut to the chase and go back to Yale. Okay, 12 00:00:47,760 --> 00:00:52,360 Speaker 2: you had Bob Evanson is your faculty advisor at Yale. 13 00:00:52,400 --> 00:00:55,080 Speaker 2: Did you ever go to the Yale Harvard tailgate games 14 00:00:55,120 --> 00:00:56,800 Speaker 2: that were legendary with Evanson? 15 00:00:57,520 --> 00:01:00,200 Speaker 3: No, but he did send me the Pesol Fundau in 16 00:01:00,440 --> 00:01:04,240 Speaker 3: Brazil to look at their agricultural experiment stations and see 17 00:01:04,480 --> 00:01:05,199 Speaker 3: what they were doing. 18 00:01:05,319 --> 00:01:09,920 Speaker 2: His was granular data, which is the way Steve Englander rolls. 19 00:01:10,280 --> 00:01:13,840 Speaker 2: What take the Yale granular study that Colls commissioned. Shill 20 00:01:13,880 --> 00:01:16,560 Speaker 2: learn all that and bring it over to how you 21 00:01:16,600 --> 00:01:19,880 Speaker 2: make a call of fifty basis points in September. 22 00:01:21,880 --> 00:01:24,679 Speaker 3: I think the trick is to try and understand everything 23 00:01:24,680 --> 00:01:27,480 Speaker 3: that's in the market and ask you why does the 24 00:01:27,480 --> 00:01:31,160 Speaker 3: market think what it's thinking? What is the market logic? 25 00:01:31,840 --> 00:01:33,680 Speaker 3: And then say do I have a right to disagree 26 00:01:33,760 --> 00:01:35,640 Speaker 3: with it? Do I think that there's something I know 27 00:01:35,720 --> 00:01:38,360 Speaker 3: that the market doesn't know? And how comfortable am I 28 00:01:38,480 --> 00:01:40,840 Speaker 3: with it? Let's start on the dual mandate of inflation. 29 00:01:40,959 --> 00:01:44,319 Speaker 2: Let's go back to Evanson, giant of Minnesota and teaching 30 00:01:44,360 --> 00:01:48,080 Speaker 2: it Yale iconic and that's the American farmer. The images 31 00:01:48,120 --> 00:01:52,520 Speaker 2: this weekend of farmers in Arkansas flat on their back, 32 00:01:52,800 --> 00:01:57,120 Speaker 2: how pernicious, Stephen Englander. Is the inflation now in America? 33 00:01:58,520 --> 00:02:01,880 Speaker 3: I think the perception is quite strong, and there is 34 00:02:01,960 --> 00:02:04,960 Speaker 3: a justification. I'd say this that the if you look 35 00:02:04,960 --> 00:02:09,239 Speaker 3: at some of the adjustments for technological progress, our computers 36 00:02:09,280 --> 00:02:11,160 Speaker 3: are much better, but we don't use that much of 37 00:02:11,200 --> 00:02:14,920 Speaker 3: their capacity. So you know, some of the softness that 38 00:02:14,960 --> 00:02:18,120 Speaker 3: we sometimes see in inflation is sort of added on 39 00:02:18,480 --> 00:02:22,240 Speaker 3: by the BLS. It's completely legitimate, but it's not what 40 00:02:22,280 --> 00:02:25,280 Speaker 3: the price of coffee is, what the you know, farmers 41 00:02:26,120 --> 00:02:29,280 Speaker 3: or inputs from market saft farmers, Stephen Englander, where there's 42 00:02:29,320 --> 00:02:31,880 Speaker 3: the standard charter bank, we are commercial trees through the 43 00:02:31,880 --> 00:02:34,760 Speaker 3: market opening and well into this nine o'clock hour. 44 00:02:34,919 --> 00:02:36,480 Speaker 2: David Gerray in for Paul Sweeney. 45 00:02:36,560 --> 00:02:38,520 Speaker 4: David, you mentioned that you're sort of looking at all 46 00:02:38,560 --> 00:02:42,120 Speaker 4: of these market factors as you come up with that forecaster. 47 00:02:42,400 --> 00:02:45,160 Speaker 4: What was it that led you to make this call? 48 00:02:45,240 --> 00:02:46,960 Speaker 4: Was it the simple variable of just the jobs numbers 49 00:02:47,000 --> 00:02:48,320 Speaker 4: that we got, or were there was there some other 50 00:02:48,440 --> 00:02:51,240 Speaker 4: mechanism or variable that made you feel confident in that. 51 00:02:52,160 --> 00:02:54,600 Speaker 3: Well, you also have to try and read the mind 52 00:02:54,639 --> 00:02:56,679 Speaker 3: of the FED and the incentives in the market and 53 00:02:57,000 --> 00:03:01,160 Speaker 3: so on, and they think, you know, yes, you know, 54 00:03:01,360 --> 00:03:02,880 Speaker 3: I actually think it's the right thing to do. And 55 00:03:03,280 --> 00:03:06,240 Speaker 3: one question I ask myself is say they had known 56 00:03:06,360 --> 00:03:08,520 Speaker 3: the data for the last four months, non FORIGM pay 57 00:03:08,600 --> 00:03:12,040 Speaker 3: rolls last four months has averaged twenty seven thousand, and 58 00:03:12,360 --> 00:03:14,160 Speaker 3: because of the bias that you get from the birth 59 00:03:14,200 --> 00:03:17,800 Speaker 3: death adjustment, we think even that's overstated. Would they have 60 00:03:17,840 --> 00:03:21,519 Speaker 3: cut And you know the answer is yeah, entire mind 61 00:03:21,520 --> 00:03:23,360 Speaker 3: that they would have cut. And so we think that 62 00:03:23,400 --> 00:03:25,880 Speaker 3: they they're not going to commit themselves to making a 63 00:03:25,919 --> 00:03:27,880 Speaker 3: series of cuts, but they're going to say, look, you know, 64 00:03:27,919 --> 00:03:30,919 Speaker 3: the numbers are softer than we expected. We're reading the 65 00:03:31,000 --> 00:03:34,679 Speaker 3: numbers and they justify cutting, but also a bit of 66 00:03:34,760 --> 00:03:35,160 Speaker 3: catch up. 67 00:03:35,400 --> 00:03:38,720 Speaker 4: We're in this moment where the integrity of government data 68 00:03:38,760 --> 00:03:41,000 Speaker 4: is being cast into question more than it has been, 69 00:03:41,920 --> 00:03:44,360 Speaker 4: certainly by personnel movements, but also as you listen to 70 00:03:44,400 --> 00:03:47,200 Speaker 4: the president's economic advisor suggesting that they're not capturing the 71 00:03:48,360 --> 00:03:51,480 Speaker 4: labor economy in a holistic sense, how does that complicate 72 00:03:51,560 --> 00:03:54,160 Speaker 4: your job as a private sector economist who's looking at 73 00:03:54,160 --> 00:03:57,040 Speaker 4: the economy. Does it raised doubts in your mind? How 74 00:03:57,120 --> 00:03:58,640 Speaker 4: how does it sort of change the work that you're 75 00:03:58,680 --> 00:03:59,920 Speaker 4: doing if that's coming about. 76 00:04:00,080 --> 00:04:02,840 Speaker 3: Well, we actually spend a lot of time looking at 77 00:04:02,840 --> 00:04:05,760 Speaker 3: the data and trying to understand if they're legitimate or not. 78 00:04:05,920 --> 00:04:08,240 Speaker 3: Like last year, one of our big papers, and I 79 00:04:08,240 --> 00:04:10,720 Speaker 3: think we were one of the first, was served integrating 80 00:04:11,480 --> 00:04:14,200 Speaker 3: undocumented immigrants and kind of saying, there's a reason the 81 00:04:14,280 --> 00:04:17,839 Speaker 3: payrolls are so strong because they're getting work permits and 82 00:04:17,880 --> 00:04:23,040 Speaker 3: getting picked up by NFP. So I actually spend an 83 00:04:23,120 --> 00:04:27,080 Speaker 3: inordinate amount of time worrying about the quality of data. 84 00:04:27,640 --> 00:04:30,480 Speaker 3: And I say this that the riskiest thing you can 85 00:04:30,520 --> 00:04:32,880 Speaker 3: do is believe people when they say you'res a gold 86 00:04:32,880 --> 00:04:36,400 Speaker 3: standard because he's self criticism goes out the door. 87 00:04:36,600 --> 00:04:38,800 Speaker 2: Stephen Englander with this here and a fed call of 88 00:04:38,920 --> 00:04:41,440 Speaker 2: fifty basis points, I want to take a little bit 89 00:04:41,480 --> 00:04:43,800 Speaker 2: of theory here. The Yale a Budget Lab at Yale 90 00:04:44,160 --> 00:04:47,520 Speaker 2: has been absolutely brilliant in teaching us about this legislation 91 00:04:48,000 --> 00:04:51,000 Speaker 2: and about tariffs as well. I personally saw terroriffs this 92 00:04:51,040 --> 00:04:54,839 Speaker 2: weekend and cannot paint when I'm fifteen percent out of 93 00:04:54,839 --> 00:04:58,240 Speaker 2: the blue. Steve Englander, I'm in the camp. David Kelly, 94 00:04:59,360 --> 00:05:01,280 Speaker 2: I want to say it hutting them at JP Morgan 95 00:05:01,560 --> 00:05:04,960 Speaker 2: David Kelly writing about the income effect as well. We're 96 00:05:05,000 --> 00:05:08,400 Speaker 2: all focused on substituting. Lisa's going to go to Costco. 97 00:05:08,480 --> 00:05:11,560 Speaker 2: She's not gonna buy coffee, She's gonna buy Sanca Blogny. 98 00:05:11,960 --> 00:05:14,520 Speaker 2: To me right now, what's going on as a major 99 00:05:15,120 --> 00:05:19,320 Speaker 2: income effect affected by purchasing power? This goes back to 100 00:05:19,360 --> 00:05:22,279 Speaker 2: a guy named Hicks, Folks, a guy named Slutsky. But 101 00:05:22,400 --> 00:05:25,479 Speaker 2: the answer is we're being a hit with a new 102 00:05:25,520 --> 00:05:27,560 Speaker 2: purchasing power that's evaporating. 103 00:05:28,440 --> 00:05:30,479 Speaker 3: I think that's correct, and you know a lot of 104 00:05:30,480 --> 00:05:33,279 Speaker 3: people understand it. You know, in terms of oil prices, right, 105 00:05:33,360 --> 00:05:36,200 Speaker 3: you know you were paying forty to fill up your tank. 106 00:05:36,279 --> 00:05:39,200 Speaker 3: Now you pay eighty. It means one less trip with 107 00:05:39,200 --> 00:05:44,280 Speaker 3: the kids to McDonald's in the week. With tariffs and 108 00:05:44,320 --> 00:05:47,680 Speaker 3: import prices, it's more spread out and less dramatic, but 109 00:05:47,680 --> 00:05:49,560 Speaker 3: it's the same kind of impact. All of a sudden, 110 00:05:49,640 --> 00:05:52,400 Speaker 3: everything you see is a little bit more expensive, and 111 00:05:52,440 --> 00:05:55,080 Speaker 3: you have to make decisions and prioritize your spending. 112 00:05:55,320 --> 00:05:58,440 Speaker 2: Feel the dreams will fifty basis points ease our pain? 113 00:05:59,760 --> 00:06:04,240 Speaker 3: I think yes, And let me be clear, because we 114 00:06:04,480 --> 00:06:06,960 Speaker 3: think that they do fifty and then they pause because 115 00:06:07,320 --> 00:06:11,640 Speaker 3: GDP numbers aren't bad. Productivity looks like it's actually pretty good. 116 00:06:11,680 --> 00:06:14,960 Speaker 2: You sure, Scharmer said that in the Ft today and the. 117 00:06:16,400 --> 00:06:18,800 Speaker 3: You know, you look at the labor numbers, as you know, 118 00:06:19,240 --> 00:06:23,320 Speaker 3: they're really mediocre. Its sluggage softish. But you know, as 119 00:06:23,360 --> 00:06:25,159 Speaker 3: you know, I was at Lehman's in two thousand and eight. 120 00:06:25,200 --> 00:06:27,599 Speaker 3: This is not a two thousand and eight type of 121 00:06:27,680 --> 00:06:31,080 Speaker 3: labor market. That's not a twenty April twenty twenty labor market. 122 00:06:31,440 --> 00:06:36,960 Speaker 3: It's a mediocre, sluggish, poor labor market where you know 123 00:06:37,000 --> 00:06:39,479 Speaker 3: you probably should get closer to neutral, but nothing is 124 00:06:39,520 --> 00:06:40,440 Speaker 3: falling off a cliff. 125 00:06:41,480 --> 00:06:44,880 Speaker 4: The Chairman has talked about the oddness of that and 126 00:06:44,920 --> 00:06:48,200 Speaker 4: the challenge of having a market like you describe. How 127 00:06:48,279 --> 00:06:51,719 Speaker 4: much closer are we to figuring out why it is 128 00:06:51,720 --> 00:06:53,120 Speaker 4: that way and why he continues to be Is it's 129 00:06:53,160 --> 00:06:57,279 Speaker 4: just the simple sense of ambiguity about policies and their effects, 130 00:06:57,360 --> 00:07:00,600 Speaker 4: is it? As you hear from Scott Bessant or An Hasset, 131 00:07:00,600 --> 00:07:02,839 Speaker 4: you know, things will take time to equilibrate or work 132 00:07:02,880 --> 00:07:05,680 Speaker 4: themselves out. What do you make of the labor market 133 00:07:05,720 --> 00:07:06,880 Speaker 4: the state of which it's in right now? 134 00:07:07,120 --> 00:07:10,120 Speaker 3: Well, look, if I want to criticize the fad, I'd 135 00:07:10,160 --> 00:07:13,320 Speaker 3: say that they spend ninety percent of their time worrying 136 00:07:13,360 --> 00:07:16,280 Speaker 3: about the man shocks. And here we are talking about 137 00:07:16,320 --> 00:07:20,800 Speaker 3: productivity shocks, talking about labor market shocks. And there's a 138 00:07:20,840 --> 00:07:24,200 Speaker 3: lot of ambiguity in terms of how you interpret numbers 139 00:07:24,400 --> 00:07:27,080 Speaker 3: when they come in because you don't know if they're moving, 140 00:07:27,440 --> 00:07:32,320 Speaker 3: you know what shock is moving them. So I think 141 00:07:32,320 --> 00:07:38,240 Speaker 3: that that's the big issue that leaves things uncertain, and 142 00:07:38,480 --> 00:07:41,280 Speaker 3: you know, uncertain about how bad things are. So I 143 00:07:41,320 --> 00:07:43,560 Speaker 3: think that you know in some ways that argues that 144 00:07:43,640 --> 00:07:45,360 Speaker 3: you know, you kind of know the direction so you 145 00:07:45,400 --> 00:07:48,400 Speaker 3: make a move, but you'd be very cautious. I mean, 146 00:07:48,560 --> 00:07:50,119 Speaker 3: what if we're in nineteen ninety seven. 147 00:07:50,640 --> 00:07:54,000 Speaker 4: Is stagflation a word that is bandied about in the 148 00:07:54,040 --> 00:07:56,720 Speaker 4: standard charted offices? Is it something that you were thinking 149 00:07:56,760 --> 00:07:58,480 Speaker 4: about or worried about at this moment. 150 00:07:59,560 --> 00:08:00,640 Speaker 2: It's always a worry. 151 00:08:00,760 --> 00:08:03,920 Speaker 3: But you know, with labor markets so soft, you know, 152 00:08:04,000 --> 00:08:07,960 Speaker 3: and spending going to be soft, I don't think labor 153 00:08:08,040 --> 00:08:10,360 Speaker 3: is going to be about to push wages up, you know. 154 00:08:10,400 --> 00:08:13,400 Speaker 3: So I think that you know, he respect in sixties, 155 00:08:13,520 --> 00:08:19,440 Speaker 3: he's so yale, irrespectful, irrespected of the productivity story. I 156 00:08:19,480 --> 00:08:22,800 Speaker 3: think that the you know, uh yeah, Darter. 157 00:08:22,720 --> 00:08:25,120 Speaker 2: With a brilliant essay this weekend and he goes back 158 00:08:25,120 --> 00:08:28,360 Speaker 2: to nominal GDP, and I get it. It's a conundrum. 159 00:08:28,360 --> 00:08:31,520 Speaker 2: Do we have terrible economic growth but still buying inflation? 160 00:08:31,600 --> 00:08:36,480 Speaker 2: Stagflation is doctor Ger talks about here, Stephen Englander. Is 161 00:08:36,520 --> 00:08:38,800 Speaker 2: the real risk here that we get this wrong and 162 00:08:38,840 --> 00:08:43,880 Speaker 2: we have dampen growth and quiescent inflation where nominal GDP 163 00:08:44,600 --> 00:08:48,760 Speaker 2: dips below five percent, ginormous number dips below Dare I 164 00:08:48,840 --> 00:08:52,400 Speaker 2: say four percent or worse? Or is that in one 165 00:08:52,400 --> 00:08:54,599 Speaker 2: of your probabilities. 166 00:08:54,559 --> 00:08:56,839 Speaker 3: You know, I think that you know, we all talk 167 00:08:56,880 --> 00:09:00,760 Speaker 3: about AI all day long, and I think that that's 168 00:09:00,760 --> 00:09:04,760 Speaker 3: going to be the real decisive for how the economy 169 00:09:04,800 --> 00:09:07,520 Speaker 3: breaks that if it turns out that we're, you know, 170 00:09:07,559 --> 00:09:10,319 Speaker 3: partly because of AI or other factors, that productivity growth 171 00:09:10,360 --> 00:09:12,520 Speaker 3: is strong, right, everything's going to be fun. 172 00:09:12,559 --> 00:09:14,600 Speaker 2: But the FED doesn't have that luxury. We can talk 173 00:09:14,640 --> 00:09:17,160 Speaker 2: about it, we can go yeah, yeah, bring in Simon 174 00:09:17,240 --> 00:09:20,240 Speaker 2: Johnson up at MIT. Rogueoff was on the other day. 175 00:09:20,280 --> 00:09:22,760 Speaker 2: It's a bunch of bow type stuff. The FED doesn't 176 00:09:22,800 --> 00:09:26,240 Speaker 2: have that luxury. Do they to ponder AI and productivity? 177 00:09:27,040 --> 00:09:31,080 Speaker 3: Well, a, they should, I know, the more time on. 178 00:09:31,120 --> 00:09:36,320 Speaker 2: Stoomberg prescriptive of should. I like, Crewman was on once 179 00:09:36,360 --> 00:09:38,160 Speaker 2: and I couldn't get him to say the dreaded s 180 00:09:38,240 --> 00:09:42,560 Speaker 2: word should. Englander's doing it? What should got to do 181 00:09:42,640 --> 00:09:43,000 Speaker 2: with it? 182 00:09:43,520 --> 00:09:46,720 Speaker 3: But I think, you know, in practice, given the absence 183 00:09:46,720 --> 00:09:49,520 Speaker 3: of knowledge, it just means that you you sort of 184 00:09:49,520 --> 00:09:51,680 Speaker 3: go slowly in the direction that you think that data 185 00:09:52,160 --> 00:09:56,040 Speaker 3: are telling you. I mean, there's no straw here with 186 00:09:56,080 --> 00:09:59,240 Speaker 3: which to make bricks, and you know, you can critique 187 00:09:59,240 --> 00:10:02,720 Speaker 3: the productivity data very easily as well. So I think 188 00:10:02,720 --> 00:10:05,760 Speaker 3: that they sort of you know, you take a step, 189 00:10:05,800 --> 00:10:08,640 Speaker 3: you see what happens. Right, take another step, see what happens. 190 00:10:08,679 --> 00:10:11,280 Speaker 3: If something bad happens, you stop, or you step back 191 00:10:11,320 --> 00:10:13,520 Speaker 3: a little bit. If it looks good, you keep going. 192 00:10:15,200 --> 00:10:17,680 Speaker 2: Yeah, I want you to jump in here and finish 193 00:10:17,679 --> 00:10:20,400 Speaker 2: out the interview. We're having so much funnier folks with 194 00:10:20,480 --> 00:10:24,080 Speaker 2: the academics of doctor England or I really want to 195 00:10:24,160 --> 00:10:29,520 Speaker 2: emphasize some of this stuff is incredible dynamics moving parts. 196 00:10:29,760 --> 00:10:34,000 Speaker 2: David off of that is this dreaded word ambiguity, which 197 00:10:34,080 --> 00:10:38,959 Speaker 2: is we really don't know where we are or what's 198 00:10:39,000 --> 00:10:39,559 Speaker 2: going to happen. 199 00:10:39,640 --> 00:10:42,320 Speaker 4: Continue will, I will ask you to indulge me and 200 00:10:42,360 --> 00:10:43,719 Speaker 4: do a little work for us here as we look 201 00:10:43,720 --> 00:10:45,959 Speaker 4: ahead to this week of data. So we have these revisions, 202 00:10:46,000 --> 00:10:48,840 Speaker 4: I'm curious how you're thinking about them. But also we 203 00:10:48,880 --> 00:10:52,000 Speaker 4: had President Cools beyond Friday saying he wants to see 204 00:10:51,800 --> 00:10:54,440 Speaker 4: the inflation data this week that matters to him. We've 205 00:10:54,440 --> 00:10:56,520 Speaker 4: got to look at the inflation side too, He says, 206 00:10:57,000 --> 00:10:58,760 Speaker 4: how important is that to you? So how should be 207 00:10:58,760 --> 00:11:00,880 Speaker 4: thinking or framing the day releases that we're going to 208 00:11:00,920 --> 00:11:01,440 Speaker 4: get this week? 209 00:11:01,559 --> 00:11:04,600 Speaker 3: Okay, I think the important thing about the benchmark revisions 210 00:11:05,200 --> 00:11:08,400 Speaker 3: is we think they're going to be significant, maybe seven 211 00:11:08,480 --> 00:11:12,360 Speaker 3: hundred and fifty to one million down and important things 212 00:11:12,400 --> 00:11:14,040 Speaker 3: there is there's no reason to think that things have 213 00:11:14,120 --> 00:11:19,360 Speaker 3: gotten better since the March of twenty twenty five. As 214 00:11:19,400 --> 00:11:23,800 Speaker 3: far as inflation goes, I think the real issue. You know, yeah, 215 00:11:23,960 --> 00:11:26,040 Speaker 3: so you know my shirt price went up because there's 216 00:11:26,040 --> 00:11:28,800 Speaker 3: a tariff on shirts. I mean, you don't know how 217 00:11:28,840 --> 00:11:31,800 Speaker 3: to engauge it. If it turns out that, you know, 218 00:11:31,880 --> 00:11:34,640 Speaker 3: say services inflation is heating up and stuff that you 219 00:11:34,720 --> 00:11:37,839 Speaker 3: know is not related to tariffs is heating up, then 220 00:11:37,880 --> 00:11:38,920 Speaker 3: there's a problem. 221 00:11:39,280 --> 00:11:42,400 Speaker 2: What happens to the animal spirit? You mentioned seven fifty 222 00:11:42,640 --> 00:11:45,360 Speaker 2: to one million, Most people are below that, it's say 223 00:11:45,360 --> 00:11:47,920 Speaker 2: four hundred and five. I mean, Steve Angler's out in 224 00:11:47,960 --> 00:11:50,280 Speaker 2: a linear folks, with what we're going to see tomorrow. 225 00:11:50,280 --> 00:11:54,520 Speaker 2: We'll have complete coverage of this. And Steven Angler, what 226 00:11:54,559 --> 00:11:59,880 Speaker 2: does it mean for people's retirement plans? Slash the stock market? 227 00:12:00,160 --> 00:12:03,680 Speaker 2: If we get Anglander rate cuts? Is that good or 228 00:12:03,760 --> 00:12:05,160 Speaker 2: bad for equities? 229 00:12:06,200 --> 00:12:09,120 Speaker 3: You know, a little bit of bad news is probably 230 00:12:09,160 --> 00:12:11,880 Speaker 3: pretty good for equities because it calms the market down 231 00:12:12,000 --> 00:12:14,120 Speaker 3: and it sort of says, look, if you get your 232 00:12:14,120 --> 00:12:17,320 Speaker 3: company right, cost the capital isn't going to be an 233 00:12:17,360 --> 00:12:20,480 Speaker 3: issue for you. I think if things are really falling apart, 234 00:12:20,600 --> 00:12:23,080 Speaker 3: like you know, twenty twenty or two thousand and eight, 235 00:12:23,880 --> 00:12:26,520 Speaker 3: then you know, bad news is really bad news. But 236 00:12:27,040 --> 00:12:29,439 Speaker 3: in many circumstances, a little bit of bad news is 237 00:12:29,480 --> 00:12:34,199 Speaker 3: actually good news for equities. And I'd say things that 238 00:12:34,240 --> 00:12:36,240 Speaker 3: the equity. You know, you sort of say why your 239 00:12:36,280 --> 00:12:39,160 Speaker 3: equity is so strong when when everybody thinks things are 240 00:12:39,160 --> 00:12:41,520 Speaker 3: a mush. It sort of makes you look at the 241 00:12:41,520 --> 00:12:45,400 Speaker 3: productivity element again, kind of saying, well, wages aren't going up, 242 00:12:45,400 --> 00:12:47,520 Speaker 3: but it looks like GDP is fairly strong. 243 00:12:48,200 --> 00:12:48,760 Speaker 2: What's left. 244 00:12:48,840 --> 00:12:52,040 Speaker 3: It's not going into taxes, right, there's only profits. 245 00:12:52,360 --> 00:12:55,600 Speaker 2: Bill from London emails in he's with a standard Charter 246 00:12:55,679 --> 00:12:58,520 Speaker 2: bank and says, ask Steven what it means for the 247 00:12:58,559 --> 00:13:02,280 Speaker 2: rest of the world. How about standards charter question this 248 00:13:02,360 --> 00:13:05,680 Speaker 2: morning for Bill Winters, what does all this Englander talk 249 00:13:05,880 --> 00:13:09,440 Speaker 2: mean for Singapore, for London and the rest of the 250 00:13:09,640 --> 00:13:10,960 Speaker 2: standard charter world? 251 00:13:11,160 --> 00:13:14,360 Speaker 3: In some ways it's actually okay. I mean there are 252 00:13:14,360 --> 00:13:16,680 Speaker 3: two elements. One is that if you look at the 253 00:13:16,720 --> 00:13:19,680 Speaker 3: AI game, if that's the game, you sort of say, okay, 254 00:13:19,880 --> 00:13:22,680 Speaker 3: us seems to be on the game. China might be 255 00:13:22,760 --> 00:13:25,680 Speaker 3: in the game. A bunch of other countries trying to 256 00:13:25,679 --> 00:13:27,440 Speaker 3: get in Europe, you know. 257 00:13:27,760 --> 00:13:29,760 Speaker 2: Right not there having some conferences. 258 00:13:29,880 --> 00:13:34,360 Speaker 3: On the other hand, you know, the say US GDP 259 00:13:35,480 --> 00:13:39,000 Speaker 3: or say the FED cuts by the fifty basis points. 260 00:13:39,360 --> 00:13:42,679 Speaker 3: That's everybody else's interest rates go down by thirty to 261 00:13:42,679 --> 00:13:46,680 Speaker 3: fifty basis points. And that's far more important to them 262 00:13:46,920 --> 00:13:50,160 Speaker 3: than sort of saying, well, oh, you know if England 263 00:13:50,160 --> 00:13:52,800 Speaker 3: there's right, you know they're forty your jobs that they're 264 00:13:52,840 --> 00:13:55,560 Speaker 3: not going to buy a Singapore exports. The fact that 265 00:13:55,600 --> 00:13:57,679 Speaker 3: they can get their cost of capital and the risk 266 00:13:57,720 --> 00:13:59,640 Speaker 3: premium is down, they think is more important to the 267 00:13:59,640 --> 00:14:00,200 Speaker 3: rest of us. 268 00:14:00,280 --> 00:14:03,240 Speaker 2: Bill Winters know that Standard Charter Bank is up eighty 269 00:14:03,320 --> 00:14:06,600 Speaker 2: nine point sixty seven percent in the past twelve months 270 00:14:06,640 --> 00:14:07,840 Speaker 2: because of Steve Englander. 271 00:14:08,880 --> 00:14:11,240 Speaker 3: Well, I think he can add like four or five 272 00:14:11,280 --> 00:14:18,000 Speaker 3: decimal points. I'm not from your mouth to his ears, honored. 273 00:14:18,040 --> 00:14:19,800 Speaker 2: We'd love to get a phone call with you tomorrow 274 00:14:19,800 --> 00:14:22,800 Speaker 2: on your busy day, Steve Englander. When we get this data. 275 00:14:23,120 --> 00:14:26,800 Speaker 2: Doctor Englander is with a Standard Charter Bank and they're 276 00:14:26,880 --> 00:14:30,040 Speaker 2: just thrilled to give you extended conversations. There that's what 277 00:14:30,080 --> 00:14:34,120 Speaker 2: Bloomberg likes to do for Global at Wall Street. Stay 278 00:14:34,160 --> 00:14:38,040 Speaker 2: with us. More from Bloomberg Surveillance coming up after this. 279 00:14:45,280 --> 00:14:48,840 Speaker 1: You're listening to the Bloomberg Surveillance podcast. Catch us live 280 00:14:48,920 --> 00:14:52,080 Speaker 1: weekday afternoons from seven to ten am Eastern Listen on 281 00:14:52,160 --> 00:14:55,840 Speaker 1: Applecarplay and Android Auto with the Bloomberg Business app, or 282 00:14:55,960 --> 00:14:57,320 Speaker 1: watch us live on YouTube. 283 00:14:57,440 --> 00:14:59,880 Speaker 2: The good news from Mark Geller is he's Aisconsin London. 284 00:15:00,160 --> 00:15:02,920 Speaker 2: He probably avoided the hit of the summer here for 285 00:15:03,000 --> 00:15:05,800 Speaker 2: Global Wall Street. Mister Geller's global head of Bank Debt 286 00:15:05,840 --> 00:15:08,720 Speaker 2: capital Markets at Berkley's. And this is a chat for 287 00:15:08,800 --> 00:15:12,080 Speaker 2: Global at Wall Street. The big song this summer, I know, 288 00:15:12,280 --> 00:15:15,320 Speaker 2: are you in the Hamptons this summer? Unfortunately not more 289 00:15:15,320 --> 00:15:19,200 Speaker 2: than Hamptons. Are these trench at lyrics because this is 290 00:15:19,240 --> 00:15:22,120 Speaker 2: where we are in September. I'm looking for a man 291 00:15:22,160 --> 00:15:27,880 Speaker 2: in finance Trust fun six' five blue, Eyes Finance trust 292 00:15:27,960 --> 00:15:31,640 Speaker 2: fun six' five. Blue eyes that's the deep lyrics of. 293 00:15:31,680 --> 00:15:34,360 Speaker 2: This song are we in an m and? A frenzy 294 00:15:34,480 --> 00:15:38,440 Speaker 2: are we Going With? President trump? A deregulation just with 295 00:15:38,480 --> 00:15:41,960 Speaker 2: the way the? Stars align is your day to day activity? 296 00:15:42,040 --> 00:15:43,560 Speaker 2: Right now nuts. 297 00:15:44,200 --> 00:15:46,240 Speaker 5: It certainly picked up over the course of, this YEAR 298 00:15:46,280 --> 00:15:49,320 Speaker 5: and i think the first quarter was particularly busy when 299 00:15:49,320 --> 00:15:52,360 Speaker 5: we think about the post election momentum that we had at. That, 300 00:15:52,440 --> 00:15:55,160 Speaker 5: time obviously as we've drifted through, the air there have 301 00:15:55,160 --> 00:15:57,720 Speaker 5: been a few, risk events not least obviously the tariff 302 00:15:57,760 --> 00:16:01,120 Speaker 5: discussions that we all had during the Course. Of april 303 00:16:01,480 --> 00:16:03,640 Speaker 5: there's been a lot of geopolitical risk which have brought 304 00:16:03,640 --> 00:16:07,440 Speaker 5: some headlines, as well whether it's On the, European Side, Middle, East. 305 00:16:07,640 --> 00:16:10,000 Speaker 5: India PAKISTAN so i think through the course of the 306 00:16:10,080 --> 00:16:13,320 Speaker 5: year there have been a few elements where issuers AND 307 00:16:13,400 --> 00:16:17,160 Speaker 5: also M and a prospective participants have had to think 308 00:16:17,240 --> 00:16:20,120 Speaker 5: very very carefully about. The year, but overall the risk 309 00:16:20,160 --> 00:16:22,280 Speaker 5: appetite that we've witnessed has been very. Very STRONG so 310 00:16:22,560 --> 00:16:24,040 Speaker 5: i think FROM an M and a point, of view 311 00:16:24,040 --> 00:16:26,720 Speaker 5: we are certainly very constructive as we think about the 312 00:16:26,800 --> 00:16:27,720 Speaker 5: progress over the. 313 00:16:27,720 --> 00:16:30,960 Speaker 2: Coming months are the clients coming to the Banks like 314 00:16:31,040 --> 00:16:35,320 Speaker 2: barclays or are you going out across the Hinterlands of 315 00:16:35,360 --> 00:16:38,200 Speaker 2: america Of continental europe and saying now is? The time 316 00:16:38,280 --> 00:16:39,600 Speaker 2: which Dynamic. 317 00:16:39,240 --> 00:16:40,040 Speaker 3: Is it's a little bit. 318 00:16:40,080 --> 00:16:40,480 Speaker 6: Of both to. 319 00:16:40,480 --> 00:16:42,000 Speaker 5: Be honest if you take a step back and you 320 00:16:42,000 --> 00:16:44,200 Speaker 5: look at the financing conditions that we've had at, the 321 00:16:44,200 --> 00:16:47,760 Speaker 5: moment the strength of the equity markets obviously many measures 322 00:16:48,040 --> 00:16:50,680 Speaker 5: across the globe at all. Time highs that's been very 323 00:16:50,680 --> 00:16:54,040 Speaker 5: favorable in terms of using that currency for opportunities ON 324 00:16:54,040 --> 00:16:55,600 Speaker 5: the M and. A SIDE and i think if you 325 00:16:55,640 --> 00:16:58,560 Speaker 5: look in terms of the cost of capital, right now 326 00:16:58,560 --> 00:17:01,080 Speaker 5: we've had rates. Relatively HIGH but i think as we've 327 00:17:01,120 --> 00:17:03,880 Speaker 5: been discussing since the job Numbers, on friday and we've 328 00:17:03,880 --> 00:17:06,679 Speaker 5: seen a reaction in terms, of rates the prospect of 329 00:17:06,680 --> 00:17:09,000 Speaker 5: seeing rate cuts over the coming months should support some 330 00:17:09,080 --> 00:17:11,159 Speaker 5: of that activity, as well in the same way that 331 00:17:11,200 --> 00:17:13,080 Speaker 5: we had three or four. Years AGO so i think 332 00:17:13,080 --> 00:17:16,040 Speaker 5: it's looking very very strong as we prospectively look ahead 333 00:17:16,040 --> 00:17:16,760 Speaker 5: over the next three to. 334 00:17:16,800 --> 00:17:19,000 Speaker 4: Six months you've enumerated a lot of the risks with 335 00:17:19,040 --> 00:17:21,199 Speaker 4: which you've had. To deal how much of, those have 336 00:17:21,880 --> 00:17:24,960 Speaker 4: if not, resolved themselves got to a place where they're 337 00:17:25,000 --> 00:17:27,920 Speaker 4: more satisfactory to those who are looking TO pursue M. 338 00:17:27,960 --> 00:17:30,800 Speaker 4: And A so i guess is there more of a 339 00:17:30,880 --> 00:17:33,439 Speaker 4: kind of comprehension or sense of the, regulatory landscape? For, 340 00:17:33,440 --> 00:17:35,680 Speaker 4: instance now is there a feeling that things have calmed 341 00:17:35,760 --> 00:17:37,600 Speaker 4: down in effect more than they were a few. 342 00:17:37,600 --> 00:17:39,640 Speaker 5: Months, back yes if you look at the, regulatory LANDSCAPE 343 00:17:39,640 --> 00:17:41,960 Speaker 5: and i think certainly coming out of the global financial 344 00:17:42,000 --> 00:17:44,239 Speaker 5: crisis for banks over the last, fifteen years it's been 345 00:17:44,240 --> 00:17:47,520 Speaker 5: about building up capital thinking about where the rest. May 346 00:17:47,560 --> 00:17:50,080 Speaker 5: be but if you look at the global bank space, 347 00:17:50,160 --> 00:17:53,600 Speaker 5: right now capital strength is very, very high liquidity is, 348 00:17:53,640 --> 00:17:57,800 Speaker 5: extremely strong vigilance around asset quality. Very HIGH so i 349 00:17:57,800 --> 00:17:59,320 Speaker 5: think you could argue that the banks are in the 350 00:17:59,359 --> 00:18:01,199 Speaker 5: best position been for twenty twenty. 351 00:18:01,240 --> 00:18:02,520 Speaker 6: Five years so that's very. 352 00:18:02,600 --> 00:18:05,199 Speaker 5: Very strong the opportunity to lend and to support some 353 00:18:05,280 --> 00:18:07,359 Speaker 5: of the m and a activity that we're likely to 354 00:18:07,400 --> 00:18:09,320 Speaker 5: witness and have seen over the course of. THIS year 355 00:18:09,800 --> 00:18:12,520 Speaker 5: i think as you consider some of those, risk events whether, 356 00:18:12,560 --> 00:18:17,360 Speaker 5: it's taris, geopolitical risk, or otherwise certainly at those moments 357 00:18:17,359 --> 00:18:19,399 Speaker 5: there's a little bit of, a pause but when you 358 00:18:19,440 --> 00:18:22,040 Speaker 5: look at the speed with which the markets recovered over, 359 00:18:22,040 --> 00:18:22,920 Speaker 5: THAT period i think it's. 360 00:18:23,000 --> 00:18:24,760 Speaker 6: Very, conducive indeed how. 361 00:18:24,680 --> 00:18:27,399 Speaker 4: About the appetite for cross, border transactions so or at 362 00:18:27,400 --> 00:18:29,040 Speaker 4: a moment here where there is a lot of ambiguity 363 00:18:29,080 --> 00:18:31,439 Speaker 4: about tariffs and, TRADE policy i think a lot of 364 00:18:32,000 --> 00:18:34,240 Speaker 4: business executives are kind of wondering what the future looks 365 00:18:34,280 --> 00:18:35,960 Speaker 4: like in terms of them putting a footprint or a 366 00:18:35,960 --> 00:18:36,800 Speaker 4: plant here IN. 367 00:18:36,840 --> 00:18:38,000 Speaker 6: The us is. 368 00:18:37,960 --> 00:18:39,600 Speaker 2: That dampening sentiment? 369 00:18:39,640 --> 00:18:42,760 Speaker 4: At all just the kind of confusion, OR again i 370 00:18:42,760 --> 00:18:45,080 Speaker 4: guess the sense of not knowing the way that this 371 00:18:45,119 --> 00:18:45,680 Speaker 4: is all likely to. 372 00:18:45,720 --> 00:18:47,880 Speaker 5: Play out it's certainly an element in terms of. The, 373 00:18:48,040 --> 00:18:50,080 Speaker 5: debate ABSOLUTELY and i think that's something that we have 374 00:18:50,119 --> 00:18:52,040 Speaker 5: to look at over the next. Six MONTHS but i 375 00:18:52,080 --> 00:18:54,960 Speaker 5: think the confidence around where asset valuations are, right now 376 00:18:55,160 --> 00:18:57,720 Speaker 5: it's a great opportunity to think about what your business 377 00:18:57,720 --> 00:18:59,080 Speaker 5: needs and could achieve over the next. 378 00:18:59,119 --> 00:19:00,920 Speaker 6: Few years it remains a very very. 379 00:19:00,920 --> 00:19:04,399 Speaker 5: GOOD opportunity i want you to define strategic. 380 00:19:04,520 --> 00:19:06,159 Speaker 2: FOR banks i don't know if you've, seen it but 381 00:19:06,240 --> 00:19:09,159 Speaker 2: a bank merger. Just warning maybe you can't come Out 382 00:19:09,200 --> 00:19:13,320 Speaker 2: because barclays, is INVOLVED but Pnc of pittsburgh is buying 383 00:19:13,359 --> 00:19:16,800 Speaker 2: Into the denver retail Market With. First, bank okay one 384 00:19:16,840 --> 00:19:21,880 Speaker 2: small four billion. Dollar transaction to find the word strategic 385 00:19:21,960 --> 00:19:26,119 Speaker 2: and conversations, right now not finance stuff like six or 386 00:19:26,119 --> 00:19:30,280 Speaker 2: five guys with, trust funds but the strategic mandate that's. 387 00:19:30,280 --> 00:19:33,680 Speaker 5: Out there coming back to my comments around where the 388 00:19:33,720 --> 00:19:36,400 Speaker 5: banks are globally right now in terms, of, capital liquidity 389 00:19:36,440 --> 00:19:40,000 Speaker 5: the confidence, looking forward especially outside OF the us where 390 00:19:40,040 --> 00:19:42,560 Speaker 5: there have been issues in. The past over the last, ten, 391 00:19:42,640 --> 00:19:44,879 Speaker 5: years yeah most of that seems to, have gone and 392 00:19:44,920 --> 00:19:47,880 Speaker 5: so a LOT of ceo CFOs the boards can look 393 00:19:47,920 --> 00:19:50,760 Speaker 5: forward with confidence and think about what where they want 394 00:19:50,760 --> 00:19:52,560 Speaker 5: to be over the next five to, ten years what 395 00:19:52,600 --> 00:19:55,480 Speaker 5: footprint might be missing from. Their BUSINESSES and i think 396 00:19:55,520 --> 00:19:58,600 Speaker 5: for so many banks looking through the rear view mirror 397 00:19:58,960 --> 00:20:01,760 Speaker 5: having to manage, your business whether it's because you're building 398 00:20:01,840 --> 00:20:03,960 Speaker 5: up the strength that you didn't have at, one stage 399 00:20:04,359 --> 00:20:07,480 Speaker 5: or strategically thinking about what, you need or managing conduct 400 00:20:07,520 --> 00:20:09,600 Speaker 5: issues that it. MAY be i think a lot of 401 00:20:09,640 --> 00:20:11,159 Speaker 5: that is out out of the. Way now so the 402 00:20:11,200 --> 00:20:13,359 Speaker 5: opportunity to look forward with confidence is. 403 00:20:13,400 --> 00:20:16,560 Speaker 2: Absolutely There, mark geller where There's, a barclays we continue 404 00:20:16,560 --> 00:20:19,520 Speaker 2: here global ahead of bank debt capital over. THE weekend 405 00:20:20,000 --> 00:20:22,439 Speaker 2: i know it's completely inappropriate for you to come in 406 00:20:22,720 --> 00:20:25,639 Speaker 2: and this individual Bank To, Hong kong Shanghai And. Banking 407 00:20:25,960 --> 00:20:30,159 Speaker 2: corporation the Headline from bloomberg HSBC's biggest shake up in 408 00:20:30,280 --> 00:20:35,360 Speaker 2: decade raisest STAKES. For ceo when people are, shaking up 409 00:20:35,520 --> 00:20:39,040 Speaker 2: are you seeing tweaking at the margin across the entire 410 00:20:39,600 --> 00:20:41,600 Speaker 2: or are they saying we're going to stay in, This 411 00:20:41,720 --> 00:20:45,240 Speaker 2: business we're going to get out of. That business so. 412 00:20:45,280 --> 00:20:48,000 Speaker 5: IT depends i won't comment on, individual names, of course, 413 00:20:48,720 --> 00:20:51,360 Speaker 5: but STRATEGICALLY as, i mentioned it's very important to think 414 00:20:51,400 --> 00:20:54,159 Speaker 5: about where your business will go looking ahead over the 415 00:20:54,200 --> 00:20:57,320 Speaker 5: next five to. TEN years, i think, in particular returns 416 00:20:57,359 --> 00:21:00,760 Speaker 5: for shareholders are absolutely critical. As well think about those 417 00:21:00,800 --> 00:21:03,600 Speaker 5: returns and the capital that you need to keep. Against 418 00:21:03,600 --> 00:21:05,680 Speaker 5: them where is it that you've got the best risk 419 00:21:05,720 --> 00:21:08,240 Speaker 5: adjusted return for your business and where do you want to? 420 00:21:08,240 --> 00:21:10,520 Speaker 5: Take IT so i think looking at some of those 421 00:21:10,560 --> 00:21:14,080 Speaker 5: strategic changes that we've had across the banking, landscape globally 422 00:21:14,480 --> 00:21:14,960 Speaker 5: it's within. 423 00:21:15,000 --> 00:21:16,359 Speaker 6: THAT lens i would describe It. 424 00:21:16,400 --> 00:21:18,560 Speaker 2: As mark thank you. So Much mark keller with us 425 00:21:18,600 --> 00:21:21,640 Speaker 2: Visiting From broccolay's Don't you good to have? You here 426 00:21:21,800 --> 00:21:26,119 Speaker 2: stay With us More From bloomberg surveillance coming up. After this. 427 00:21:33,200 --> 00:21:36,800 Speaker 1: You're listening To The bloomberg. Surveillance podcast catch us live 428 00:21:36,840 --> 00:21:40,000 Speaker 1: weekday afternoons from seven to Ten Am eastern Listen on 429 00:21:40,080 --> 00:21:43,760 Speaker 1: Applecarplay And android otto With The bloomberg, business app or 430 00:21:43,920 --> 00:21:44,680 Speaker 1: watch us live. 431 00:21:44,760 --> 00:21:47,240 Speaker 2: On YouTube he anriata trays with Us. In Washington david 432 00:21:47,240 --> 00:21:49,439 Speaker 2: girl is going to drive. This conversation i'm going to 433 00:21:49,440 --> 00:21:53,080 Speaker 2: get one question, In Here henrietta Treys With vada partners 434 00:21:53,119 --> 00:21:59,520 Speaker 2: Before mister girl. Holds, court henrietta everybody's electric bill is Up. 435 00:22:00,080 --> 00:22:00,119 Speaker 7: To. 436 00:22:00,280 --> 00:22:04,119 Speaker 2: Congress people are they aware of the inflation out there 437 00:22:04,560 --> 00:22:04,920 Speaker 2: or are? They? 438 00:22:05,000 --> 00:22:07,320 Speaker 7: REMOVED no i think they're. 439 00:22:07,359 --> 00:22:10,240 Speaker 8: Acutely aware And the american public is vary attude to. 440 00:22:10,359 --> 00:22:13,200 Speaker 8: Energy prices as we, all know this is just, After 441 00:22:13,320 --> 00:22:16,160 Speaker 8: gas so it's absolutely going to be a topic of conversation. 442 00:22:16,280 --> 00:22:19,879 Speaker 8: FLOOR speeches I think democrats are tweeting about. It constantly 443 00:22:20,040 --> 00:22:22,760 Speaker 8: republicans are trying to talk about how there's a BOOM 444 00:22:22,800 --> 00:22:24,240 Speaker 8: and ai and that's what's going. 445 00:22:24,240 --> 00:22:24,960 Speaker 7: To generate a lot of. 446 00:22:25,000 --> 00:22:28,200 Speaker 8: Economic growth but the reality is that electricity prices are through. 447 00:22:28,240 --> 00:22:31,080 Speaker 7: The roof so anybody made, that trade it's been doing. 448 00:22:31,119 --> 00:22:32,960 Speaker 7: Really well Henry. 449 00:22:32,640 --> 00:22:34,160 Speaker 4: And TOM and i were talking about we've got twenty 450 00:22:34,200 --> 00:22:36,399 Speaker 4: two days till this, potential SHUTDOWN and i gather there 451 00:22:36,400 --> 00:22:38,919 Speaker 4: are two routes That the congress could. TAKE here i 452 00:22:38,960 --> 00:22:42,760 Speaker 4: know The Appropriators susan Collins And. Tom cole they're interested 453 00:22:42,760 --> 00:22:45,560 Speaker 4: in kind of a short term. Spending bill there's an 454 00:22:45,560 --> 00:22:47,800 Speaker 4: appetite among, some MEMBERS and i think From the president 455 00:22:47,880 --> 00:22:50,399 Speaker 4: himself for a longer term bill that would take us to. 456 00:22:50,480 --> 00:22:53,720 Speaker 4: Next year what's your sense of the, trajectory here the 457 00:22:53,720 --> 00:22:55,200 Speaker 4: way this is going to, Play, out yes over the 458 00:22:55,240 --> 00:22:56,879 Speaker 4: next couple of, weeks here bearing in mind we've got 459 00:22:56,920 --> 00:22:59,960 Speaker 4: a recess baked in there, as well but also beyond 460 00:23:00,119 --> 00:23:02,080 Speaker 4: that sort of what we're kind of spending bill we're likely, 461 00:23:02,080 --> 00:23:02,960 Speaker 4: to get if in fact. 462 00:23:02,800 --> 00:23:05,400 Speaker 8: We, get one, you know it's going to take even 463 00:23:05,440 --> 00:23:07,960 Speaker 8: more money this cycle to keep the. Government open and 464 00:23:08,000 --> 00:23:10,160 Speaker 8: that's Something that republicans generally don't want to. Talk about 465 00:23:10,240 --> 00:23:13,200 Speaker 8: After especially doge And the president's. 466 00:23:12,760 --> 00:23:14,560 Speaker 7: Efforts to cut the fat on. 467 00:23:14,640 --> 00:23:18,080 Speaker 8: Federal spending the reality Is the president has requested more 468 00:23:18,080 --> 00:23:21,320 Speaker 8: money For the Department of defense than. Ever before we're 469 00:23:21,359 --> 00:23:23,560 Speaker 8: going to be spending about two trillion dollars just to 470 00:23:23,600 --> 00:23:28,560 Speaker 8: keep the. Lights on so there is a reaction Function 471 00:23:28,720 --> 00:23:32,080 Speaker 8: in congress where instead of passing a big two trillion 472 00:23:32,119 --> 00:23:34,040 Speaker 8: dollar package just to keep the, lights on they end 473 00:23:34,119 --> 00:23:37,400 Speaker 8: up splicing it into into. Little pieces and so that's 474 00:23:37,400 --> 00:23:39,040 Speaker 8: probably what we're going to get going into the last 475 00:23:39,119 --> 00:23:41,160 Speaker 8: couple months of. This year you'll get a short term 476 00:23:41,160 --> 00:23:44,080 Speaker 8: STOCK gap cr that lasts as few as like three 477 00:23:44,119 --> 00:23:48,200 Speaker 8: weeks sometimes, they do or Into, mid december Just. Before 478 00:23:48,280 --> 00:23:51,959 Speaker 8: christmas and the benefit of that For The minority party 479 00:23:52,359 --> 00:23:54,400 Speaker 8: is to basically chop up. 480 00:23:54,320 --> 00:23:57,280 Speaker 7: The legislative momentum that the majority party. 481 00:23:57,359 --> 00:23:59,720 Speaker 8: Might get so you, see this when either side is 482 00:23:59,720 --> 00:24:03,040 Speaker 8: in you get a short TERM stopgap cr that pushes 483 00:24:03,080 --> 00:24:05,040 Speaker 8: you Into A veteran's day And, then christmas and you 484 00:24:05,080 --> 00:24:06,920 Speaker 8: just do that over and. Over again and you could 485 00:24:06,920 --> 00:24:09,400 Speaker 8: tell that that's the strategy because the far right now 486 00:24:09,480 --> 00:24:12,639 Speaker 8: is asking for a FULL, year cr which is historically anathema. 487 00:24:12,720 --> 00:24:15,720 Speaker 4: To THEM henrietta i Read The ezra kline essay In 488 00:24:15,760 --> 00:24:17,440 Speaker 4: The New york times over. The weekend he's done a 489 00:24:17,520 --> 00:24:19,960 Speaker 4: video audio component of that, as well but he talks 490 00:24:20,000 --> 00:24:22,520 Speaker 4: a lot about the Bargain That chuck schumer made Back 491 00:24:22,560 --> 00:24:25,679 Speaker 4: in march he convinced members of his caucus to go 492 00:24:25,720 --> 00:24:29,600 Speaker 4: along with the last. Spending Bill, ezra kline a long 493 00:24:29,640 --> 00:24:33,360 Speaker 4: time of progressive writer, opinion columnist saying that he supported 494 00:24:33,359 --> 00:24:35,560 Speaker 4: that at. The time he understood Why the minority leader 495 00:24:35,600 --> 00:24:36,920 Speaker 4: was doing that at, the time but he said this time, 496 00:24:37,000 --> 00:24:39,480 Speaker 4: is DIFFERENT and i wonder if you agree with. That 497 00:24:39,520 --> 00:24:42,560 Speaker 4: assessment how much of a fisher you See, within democrats 498 00:24:42,560 --> 00:24:45,440 Speaker 4: and how that's kind of compounding the risk or the 499 00:24:45,480 --> 00:24:47,360 Speaker 4: odds that were likely to see a shutdown this, time 500 00:24:47,400 --> 00:24:50,040 Speaker 4: around That that democrats simply didn't get enough out of 501 00:24:50,280 --> 00:24:51,560 Speaker 4: going along with that spending bill. 502 00:24:51,640 --> 00:24:51,840 Speaker 6: Last. 503 00:24:51,880 --> 00:24:55,240 Speaker 7: TIME yeah I think klein's argument is. 504 00:24:55,280 --> 00:24:57,199 Speaker 8: Really interesting the ONE thing i agree with Is that 505 00:24:57,240 --> 00:24:59,600 Speaker 8: democrats need to get their. ACT together, i mean they 506 00:24:59,640 --> 00:25:04,320 Speaker 8: don't have a comprehensive message or, A strategy, AND frankly 507 00:25:04,359 --> 00:25:08,159 Speaker 8: i don't think shutting it down just To steyvey trump's 508 00:25:08,359 --> 00:25:12,760 Speaker 8: forward march is necessarily a. Cohesive argument you're going to 509 00:25:12,800 --> 00:25:14,320 Speaker 8: have to put a lot more meat on. The bones, 510 00:25:14,720 --> 00:25:18,200 Speaker 8: i'm biased OBVIOUSLY because i cover, macroeconomic policy but talk 511 00:25:18,240 --> 00:25:21,280 Speaker 8: about fiscal dominance and trying to stress Us the fed 512 00:25:21,840 --> 00:25:25,000 Speaker 8: into cutting. Interest rates talk about how you're about to 513 00:25:25,040 --> 00:25:27,879 Speaker 8: take Over The supreme court and force the ruling that 514 00:25:27,920 --> 00:25:31,080 Speaker 8: allows the president to Tax the. American people that's literally 515 00:25:31,280 --> 00:25:33,440 Speaker 8: what we Fought the. British OVER so i think there 516 00:25:33,480 --> 00:25:36,200 Speaker 8: are really clear arguments and clients saying shut it down 517 00:25:36,200 --> 00:25:37,240 Speaker 8: and begin you, About. 518 00:25:37,040 --> 00:25:39,320 Speaker 2: That andrea and one quick, question Here and i'm sure 519 00:25:39,359 --> 00:25:42,320 Speaker 2: we'll talk about it as we've staggered to the election over. 520 00:25:42,359 --> 00:25:45,600 Speaker 2: A beverage, THIS weekend i was pontificating About the virginia. 521 00:25:45,680 --> 00:25:52,040 Speaker 2: Governor Race, earl Sears the Republican Against, abbie Spanberger the democrat. 522 00:25:52,119 --> 00:25:55,200 Speaker 2: Out there How's the democrat doing there Is As abigail 523 00:25:55,280 --> 00:25:59,880 Speaker 2: spanberger A new Democrat Is david gera Talks, ABOUT. 524 00:25:59,520 --> 00:26:02,160 Speaker 8: Yeah I think virginia is a perfect example of where 525 00:26:02,200 --> 00:26:04,479 Speaker 8: the federal spending cuts. Come in whether you get an, 526 00:26:04,480 --> 00:26:07,560 Speaker 8: engage population whether Or not democrats, turn out that's what 527 00:26:07,600 --> 00:26:09,440 Speaker 8: they need. To drive so as long as you're having, 528 00:26:09,440 --> 00:26:13,240 Speaker 8: That conversation democrats should just by being in the minority 529 00:26:13,280 --> 00:26:15,199 Speaker 8: when one party, has control they should pick Up the 530 00:26:15,200 --> 00:26:16,919 Speaker 8: house and make a real dent in some Of the 531 00:26:16,920 --> 00:26:19,520 Speaker 8: senate seats Being Up north carolina and some of, the 532 00:26:19,520 --> 00:26:21,800 Speaker 8: others make a real run at It In joony. Earn's seats, 533 00:26:22,400 --> 00:26:24,639 Speaker 8: you know there's a lot, to do especially in and 534 00:26:24,680 --> 00:26:25,760 Speaker 8: out year at an interim. 535 00:26:25,800 --> 00:26:28,200 Speaker 2: Election, cycle henrietta thank you so much For The, Monday 536 00:26:28,200 --> 00:26:32,760 Speaker 2: Brief HENRIETTA treys theta partners stay. With us More From 537 00:26:32,800 --> 00:26:35,600 Speaker 2: bloomberg surveillance coming up. After this. 538 00:26:42,680 --> 00:26:46,280 Speaker 1: You're listening To The bloomberg. Surveillance PODCAST Catch us live 539 00:26:46,359 --> 00:26:49,520 Speaker 1: weekday afternoons from seven to Ten Am eastern Listen on 540 00:26:49,600 --> 00:26:53,240 Speaker 1: Applecarplay And android otto With The bloomberg, business app OR 541 00:26:53,400 --> 00:26:54,160 Speaker 1: Watch us live. 542 00:26:54,240 --> 00:26:57,560 Speaker 2: On YouTube Stay with bloomberg all through the day for 543 00:26:57,640 --> 00:27:01,400 Speaker 2: the history being Made. In France mister carroll At Our Paris, 544 00:27:01,480 --> 00:27:06,120 Speaker 2: NEWS bureau i THINK it's i take, Great, issues stephen and, full, 545 00:27:06,119 --> 00:27:10,520 Speaker 2: DISCLOSURE folks i have Family. In paris it's All about Paris. 546 00:27:10,560 --> 00:27:15,680 Speaker 2: For americans marseille is sixteen percent the Size. Of paris 547 00:27:16,320 --> 00:27:21,320 Speaker 2: paris is thirty percent three zero Of the. French. Economy 548 00:27:21,359 --> 00:27:25,760 Speaker 2: folks It's like La In new york combined. In, impact 549 00:27:26,160 --> 00:27:31,640 Speaker 2: stephen how does this political crisis Play, in Marseille, in Leon. 550 00:27:32,119 --> 00:27:37,919 Speaker 9: In, bordeaux, well look you're mentioning Places in france where 551 00:27:38,040 --> 00:27:40,960 Speaker 9: some of the more writing parties have. Greater strongholds so 552 00:27:41,000 --> 00:27:43,800 Speaker 9: many of the people who voted in those particular cities 553 00:27:43,880 --> 00:27:47,160 Speaker 9: might also be wondering about why they don't see themselves 554 00:27:47,160 --> 00:27:51,480 Speaker 9: represented more accurately in the government of. The day we're 555 00:27:51,520 --> 00:27:53,720 Speaker 9: looking at a government spit in or a parliament rather. 556 00:27:53,760 --> 00:27:56,960 Speaker 9: Spit in about three the Far Right nata rally party 557 00:27:57,200 --> 00:28:01,280 Speaker 9: is the largest single party in parliam although the Way 558 00:28:01,320 --> 00:28:03,720 Speaker 9: that french, politicans worked as no other party has wanted 559 00:28:03,760 --> 00:28:06,520 Speaker 9: to go into business with them to form. A government 560 00:28:06,560 --> 00:28:08,800 Speaker 9: they wouldn't be able to on the current parliamentary, maps 561 00:28:08,800 --> 00:28:11,919 Speaker 9: anyway but essentially within those three blocks that nobody has 562 00:28:12,000 --> 00:28:15,080 Speaker 9: enough of a majority, to govern which is why we're 563 00:28:15,119 --> 00:28:19,920 Speaker 9: heading towards our seventh prime minister since twenty Two Since 564 00:28:20,119 --> 00:28:23,479 Speaker 9: emmanuel macron. Became president stephen, Quickly here i'm just curious 565 00:28:23,480 --> 00:28:25,359 Speaker 9: what the flavor of this speech is going. To be 566 00:28:25,359 --> 00:28:27,760 Speaker 9: as we talked about a little, While Back michel barney 567 00:28:27,840 --> 00:28:30,240 Speaker 9: gave one of these speeches about little less than it 568 00:28:30,240 --> 00:28:30,439 Speaker 9: than a. 569 00:28:30,480 --> 00:28:32,200 Speaker 2: Year ago what are we expecting to? Hear you what 570 00:28:32,280 --> 00:28:33,119 Speaker 2: you'd be watching for in. 571 00:28:33,160 --> 00:28:34,000 Speaker 6: That speech. 572 00:28:35,520 --> 00:28:38,720 Speaker 9: His message has been really, consistent throughout not only since 573 00:28:38,760 --> 00:28:41,440 Speaker 9: He Became, prime minister or when he announced the budget 574 00:28:41,560 --> 00:28:44,400 Speaker 9: Outlines in july or two, weeks ago when he called this, 575 00:28:44,760 --> 00:28:46,800 Speaker 9: governance voter even if you go back as far as 576 00:28:46,840 --> 00:28:49,760 Speaker 9: the two thousand and seven presidential campaign when he was 577 00:28:49,800 --> 00:28:52,720 Speaker 9: a candidate. As well it's about Bringing the french deficit 578 00:28:52,800 --> 00:28:56,880 Speaker 9: and debt. Under control he's repeated over and, over again 579 00:28:57,120 --> 00:28:59,400 Speaker 9: this figure Of the french debt going up by FIVE 580 00:28:59,440 --> 00:29:03,520 Speaker 9: thousand us. Every second it's actually a really interesting example 581 00:29:03,560 --> 00:29:07,840 Speaker 9: of how you try to communicate, a massive largely incomprehensible 582 00:29:08,480 --> 00:29:11,760 Speaker 9: problem with debt to the general public to try to 583 00:29:11,800 --> 00:29:14,680 Speaker 9: win support. For them but essentially he's failed in, that 584 00:29:14,720 --> 00:29:17,800 Speaker 9: mission despite being very consistent over the years of his 585 00:29:17,880 --> 00:29:20,440 Speaker 9: Position that france needs to bring its public spending, under 586 00:29:20,440 --> 00:29:23,680 Speaker 9: control needs to bring down its debt levels and bring 587 00:29:23,720 --> 00:29:27,400 Speaker 9: the cost of borrowing, under control because it's set to 588 00:29:27,400 --> 00:29:30,320 Speaker 9: take up an even larger part of the front budget debates. 589 00:29:30,360 --> 00:29:31,960 Speaker 2: To come i'm looking At from sobayrou now on. 590 00:29:32,040 --> 00:29:35,560 Speaker 9: His feet it's launching this debate which will determine his future. 591 00:29:35,720 --> 00:29:38,480 Speaker 2: Three Pm in Paris Or stephen kerrer will go into 592 00:29:38,480 --> 00:29:40,920 Speaker 2: the evening there to give you coverage Of the. 593 00:29:40,960 --> 00:29:46,520 Speaker 1: French government this Is The bloomberg, surveillance podcast Available, On, 594 00:29:46,600 --> 00:29:50,920 Speaker 1: apple spotify and anywhere else you get. Your podcasts listen 595 00:29:51,040 --> 00:29:54,720 Speaker 1: live each weekday seven to Ten am Eastern on Bloomberg, 596 00:29:54,760 --> 00:29:58,719 Speaker 1: dot Com the, iHeartRadio App, tune in And The bloomberg. 597 00:29:58,760 --> 00:30:02,800 Speaker 1: Business app also watch us live every weekday on YouTube 598 00:30:03,120 --> 00:30:05,120 Speaker 1: and always On the bloomberg terminal