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Speaker 1: Welcome to the Bloomberg Penl podcast. I'm Paul Sweene. You,

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Speaker 1: along with my co host Lisa brahma Witz. Each day

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Speaker 1: we bring you the most noteworthy and useful interviews for

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Speaker 1: you and your money, whether at the grocery store or

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Speaker 1: the trading floor. Find a Bloomberg Penl podcast on Apple

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Speaker 1: podcast or wherever you listen to podcasts, as well as

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Speaker 1: at Bloomberg dot com. Well, it is jobs Day today.

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Speaker 1: Two thousand jobs were added to the U S economy

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Speaker 1: in the month of June. Kind of break that down

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Speaker 1: and gives a sense of what it means and what

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Speaker 1: the FED, how the FED might react. We welcome Bill Dudley.

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Speaker 1: Bill is a senior research scholar Prince University Center for

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Speaker 1: Economic Policy. Is also a former Federal Reserve Bank of

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Speaker 1: New York President. Bill. We're gonna start off by listening

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Speaker 1: to National Economic Council Director Larry Cudlow. He spoke with

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Speaker 1: Bloomberg Television following this morning's job report. Let's take a listen. Now,

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Speaker 1: I do you have an inverted YO curve, which I

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Speaker 1: think is somewhat problesome for the longer term, but the

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Speaker 1: break evens on the inflation you know, the tips break

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Speaker 1: evens the five year Jonathan is one and a half percent,

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Speaker 1: and that's the CPI number. So the pc deflated that

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Speaker 1: the FED uses would be about thirty basis points less

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Speaker 1: than that. So you're one a quarter percent inflation, which

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Speaker 1: is way below the Fed's target and what most people want.

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Speaker 1: And that's the reason I think they should take back

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Speaker 1: the interest rate hike. So Mr Cutler saying, take back

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Speaker 1: the December rate hike, Bill, Bill Dudley, what do you think? Well,

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Speaker 1: I think it's still up in the air what the

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Speaker 1: Fed is gonna do at the July of from C meeting.

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Speaker 1: I mean this, this report was stronger than expected, and

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Speaker 1: so I think what it does is it takes the

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Speaker 1: fifty basis points easing idea off the table lease for

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Speaker 1: the time being. And then the question is do you

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Speaker 1: do to stand pat wait for more information or do

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Speaker 1: you cut base points. Larry Cudlos obviously making the case

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Speaker 1: of the Fed should cut rates because inflation expectations are

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Speaker 1: you know, blow two. But the Fed has also taken

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Speaker 1: into into account the fact that the economy looks like

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Speaker 1: it's continuing to grow at a decent place. Payroll gains

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Speaker 1: are stronger than what's sustainable over the long run. You know,

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Speaker 1: steady stage is probably a hundred thousand of months to

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Speaker 1: keep the unemployer rates steady. So I think there's gonna

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Speaker 1: be an interesting debate. And obviously we have three and

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Speaker 1: app more weeks of data before the FED meets, so

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Speaker 1: I think it's still very much up in the air

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Speaker 1: what the Fit's going to do with the July meeting.

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Speaker 1: Former New York FED at President, I'm so excited that

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Speaker 1: we have you today. One question that I keep coming

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Speaker 1: back to is what is the feds ultimate goal? What

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Speaker 1: is their ultimate objective and mandate? What's your view on that? Well,

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Speaker 1: obviously they want to keep the economic expansion going, and

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Speaker 1: there's risks on both sides. Risk on one side is

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Speaker 1: that if they pursue a too easy Monterrey policy, inflation

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Speaker 1: rises and then they have to slam in the brakes

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Speaker 1: and that generates recessions. So that's risk on one side.

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Speaker 1: Risk on the other side is that they tightened Entrey

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Speaker 1: policy prematurely and that keeps inflation below their two long

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Speaker 1: term objective. Uh and the comedy softens and people have

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Speaker 1: basically asked to FED, why do you tighten Madre policy

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Speaker 1: when inflation was below your objective, and so they're trying

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Speaker 1: to balance those two risks. Do you think that it

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Speaker 1: is wise for them to cut rates by at least

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Speaker 1: fifty basis points by your end as markets are currently

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Speaker 1: pricing in. Well, I mean, obviously depends on how the

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Speaker 1: economy evolves. I don't see the economy is that week.

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Speaker 1: I see the econmy is doing fine. It seems to

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Speaker 1: me like it's growing about trend or maybe a little

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Speaker 1: bit above trend. The labor market, in my mind, still

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Speaker 1: looks like it's continuing to gradually tighten. So I guess

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Speaker 1: if I were sitting there at the fo C, I'd

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Speaker 1: be more on the patient camp. I probably would at

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Speaker 1: the July meeting, I probably would say, let's let's have

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Speaker 1: a statement that doesn't close the door to future eason,

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Speaker 1: but let's let's wait and get some more information. So

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Speaker 1: build this. FED has said publicly that it is data

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Speaker 1: dependent aside from labor statistics. What do you think the

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Speaker 1: Fed's really focusing on right now? Well, I think they

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Speaker 1: are focused on, you know, one, what's the trajectory for

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Speaker 1: GDP growth in the state of the labor market. But

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Speaker 1: to they're also, as Larry Cutlows pointed out, they're also

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Speaker 1: focused on inflation. The fact is inflation has come in

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Speaker 1: below their expectations. So the core personal consumption expenditure deflator

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Speaker 1: is rising one point six percent on a year over

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Speaker 1: year basis, below the two goal. And also, as as

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Speaker 1: Larry pointed out, inflation expectations look like they've dropped a bit.

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Speaker 1: So that's another reason for the Fed to consider easy policy.

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Speaker 1: And there's basically three paths to easing. One is growth

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Speaker 1: is weaker than expected. The second path to easing is

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Speaker 1: that inflation turns out to be lower than expected. And

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Speaker 1: the third is that risk in the in the economic

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Speaker 1: out look goes up because of perhaps uncertainty about trade policy.

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Speaker 1: So there's lots of paths to get the Fed to

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Speaker 1: an easier montroy policy. And I think that's really why

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Speaker 1: easing is priced into the markets right now. When you

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Speaker 1: were ahead of the New York Fed, one of the

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Speaker 1: roles of that agency is to really monitor financial stability

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Speaker 1: financial market, and I'm wondering what you see as the

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Speaker 1: potential risks that are building with respect to inflated asset

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Speaker 1: values if the Fed does cut rates, and given how much.

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Speaker 1: How low rates have been kept for as long as

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Speaker 1: they have Well, I think at the end of the day,

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Speaker 1: I mean they're they're gonna be focused mostly on the

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Speaker 1: growth outlook and the inflation out look. But they do

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Speaker 1: have to be aware of the fact that there's not

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Speaker 1: much evidence right now that Matrey policy is tight and

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Speaker 1: if you look at financial conditions, financial conditions do seem

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Speaker 1: actually quite supportive for growth. So the strongest argument to

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Speaker 1: hold off, frankly, is that policy Monterrey policy is not

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Speaker 1: holding back the US economy to any measurable degree that

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Speaker 1: I can see. So BUILD Chairman pal has suggested that

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Speaker 1: the FED might end it's quantitative tightening. Do you think

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Speaker 1: that's a good idea. Well, they've already said that that

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Speaker 1: they're going to bring that to the end at the

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Speaker 1: end of September. There's been some speculation though that if

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Speaker 1: they cut rates in if the July means, they might

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Speaker 1: also move the ending of their balance sheet up to

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Speaker 1: to to that at that point in time, I personally

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Speaker 1: think they should just keep the balance sheet policy as

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Speaker 1: it is today. We're going to continue to run our

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Speaker 1: securities until September uh and then and bring that to

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Speaker 1: a close I mean, basically tying the short term rate

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Speaker 1: decision to the balance sheet decision I think is inappropriate

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Speaker 1: right now, because the balance sheet decision is not motivated by,

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Speaker 1: you know, what the FEDS trying to do in terms

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Speaker 1: of the stance of monetary policy. It's motivated by how

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Speaker 1: much reserves the Fed thinks should be in the banking

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Speaker 1: system consistent with the efficient execution of monetary policy. And

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Speaker 1: that's why they decided that they were going to end

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Speaker 1: it in September. So I think they just should stick

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Speaker 1: to that decision. So you said that monetary policy is

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Speaker 1: not holding back the economy, that is the message when

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Speaker 1: you look at the easy financial conditions. What would a

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Speaker 1: rate cut accomplish then, Well, I think the rate cut

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Speaker 1: would be you know, basically would be insurance, would be

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Speaker 1: basically saying, look, we're unhappy with some of the uncertainty

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Speaker 1: about the global growth outlook, and also would be a

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Speaker 1: way of saying that we're on happy with inflation being

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Speaker 1: below er two percent of objectives. So I don't think that,

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Speaker 1: you know, fundamentally, it would matter that much to the

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Speaker 1: economy if the Fed cut twenty five basis points or

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Speaker 1: didn't cut twenty five basis points but be a way

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Speaker 1: of uh exhibiting some unhappiness with I think the inflation

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Speaker 1: trajectory so build. President Trump is out with some tweets

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Speaker 1: this morning on the job's number and some other topics.

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Speaker 1: But one of the tweets says the Trump says the

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Speaker 1: FED quote doesn't know what they are doing. End quote.

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Speaker 1: Tweets like that, to what extent do you think they

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Speaker 1: impact members of the FED end or policy? Well, I

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Speaker 1: think that the FED has been doing a pretty good

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Speaker 1: job and we're in the we're basically now have the

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Speaker 1: longest economic expansion at u S history, and I think, well,

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Speaker 1: the President, with what wants to take most of the

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Speaker 1: credit for that. I think the FED does are some

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Speaker 1: some credit as well. Um, I think that basically the

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Speaker 1: Trump's pressure on the FED really actually probably is counterproductive

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Speaker 1: in the sense that the FED doesn't want to do

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Speaker 1: something that is seen as caving into presidential rusher. They

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Speaker 1: want to be seen as doing something that's appropriate given

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Speaker 1: the economic outlook. So at anything, if anything, I think

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Speaker 1: this probably makes the set a little bit more stubborn

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Speaker 1: in terms of moving interest rates. Yet, President Trump has

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Speaker 1: been speaking and he has continued to speak we'll bring

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Speaker 1: you the headlines as they come out, saying that that

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Speaker 1: FED cutting rates would help the economy, and he's very

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Speaker 1: happy about the jobs numbers still with US Bill Dudley,

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Speaker 1: who is the former New York FED President. Uh. You know,

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Speaker 1: one interesting sort of outcome of this strong job's report

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Speaker 1: has been a stronger dollar, with the dollar surging against

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Speaker 1: peers today. This has also been a concern of President Trump's.

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Speaker 1: He has tweeted about the fact that he would like

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Speaker 1: to see it weaker, talked about currency manipulation. Would it

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Speaker 1: be better for the U. S economy if the dollar

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Speaker 1: were weaker at this point? I don't. I don't understand

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Speaker 1: the argument. We're basically at full employment. Uh, economy is

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Speaker 1: doing fine, it's growing at an above trent pace. Why

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Speaker 1: would I want the currency to be weaker? Uh that

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Speaker 1: all that would do is reduce the US households purchasing

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Speaker 1: power of foreign goods and services. Um. You know, I

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Speaker 1: also understand why a weaker currency is something that you

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Speaker 1: want when you're operating an economy pretty close to full employment.

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Speaker 1: I can understand a weaker currency of the economy is

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Speaker 1: very weak and you're having trouble getting traction coming out

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Speaker 1: of a recession by at the time when the economy

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Speaker 1: is pretty close to full employment. I don't understand why

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Speaker 1: you don't want a weaker currency at that point. So,

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Speaker 1: but we've had economists and fund managers comment over the

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Speaker 1: last several months that, uh, they think a recession by

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Speaker 1: mid is a possibility, maybe a likelihood. What are your

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Speaker 1: thoughts there. Economic expansions don't die of old age. They

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Speaker 1: usually die because either the either there's an inflation problem

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Speaker 1: and the federal reserves response to that by tightening Monterrey policy, uh,

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Speaker 1: making Monterrey policy tight, or there's a big shock to

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Speaker 1: the economy that the FED just can't react quickly enough

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Speaker 1: to offset. There's not enough inflation for the FED respond

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Speaker 1: aggressively to tighten Madre policy. So I think the risk

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Speaker 1: of the receptive of a recession from that source is

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Speaker 1: very very low. Obviously, there is a risk of a

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Speaker 1: shock coming from the rest of the world, for in

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Speaker 1: the U s econmun But you know, the biggest one

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Speaker 1: that I think this trade policy. If trade policy, if

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Speaker 1: more confusion is created about what US trade policy is,

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Speaker 1: and that creates uncertainty about how businesses should invest, where

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Speaker 1: they should invest, how they should orient their supply chains.

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Speaker 1: That's probably the biggest risk of the economy right now,

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Speaker 1: what happens in terms of US trade policy. Bill Dudley,

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Speaker 1: thank you so much for being with us today. Bill Dudley,

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Speaker 1: former New York Fed President and senior researcher at Princeton

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Speaker 1: University Center for Economic Policy Studies, also a contributor to

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Speaker 1: Bloomberg Opinion, Commenting on today's jobs report, Well, it is

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Speaker 1: Jobs Day today, and what to day it is. The

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Speaker 1: US economy added two thousand jobs in the month of June.

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Speaker 1: You get a sense of what that means for the

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Speaker 1: US economy and FED policy going forward. To welcome our

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Speaker 1: next guest, Jim Bianco. Jim as president and founder of

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Speaker 1: Bianco Research. Jim, thanks so much for joining us. Just

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Speaker 1: give us your first quick take on what you think

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Speaker 1: the jobs report today means for the Fed Reserve. I

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Speaker 1: think it means that the subtle Reserve is now closer

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Speaker 1: to making a mistake by not cutting rates at the

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Speaker 1: July meeting, and they're going to probably push this off.

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Speaker 1: I think the markets have been telling us that the

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Speaker 1: funds rate has been too high, the Fed one too far.

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Speaker 1: Last year, one fund statistic for you. There's forty trillion

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Speaker 1: dollars worth of sovereign developed market debt in the world

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Speaker 1: and it has a yield of less than the funds rate.

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Speaker 1: Right now, the funds rate is becoming an outlier. Is

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Speaker 1: one of the highest interest rates in the world. It

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Speaker 1: needs to come down. The FED is going to look

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Speaker 1: at this strong payroll number thinking they don't have to

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Speaker 1: do that, and I think what you're seeing in the

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Speaker 1: markets is a reaction that they may may make a

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Speaker 1: mistake by not cutting rates. So, Jim, I know that

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Speaker 1: you your voice, and this is particularly important because the

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Speaker 1: White House actually considered you for one of the open

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Speaker 1: positions on the Fed's board that you are interviewed for that.

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Speaker 1: Can you just talk a little bit about what it

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Speaker 1: was like interviewing with them. What were their questions to you? Uh?

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Speaker 1: It was an amazing experience to be able to do

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Speaker 1: something like that, and I'm honored that they gave me

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Speaker 1: the opportunity to do it. Uh. They just asked me

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Speaker 1: about FED policy, They asked me about my views of

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Speaker 1: the world. Uh. They interviewed me because I'm a bit

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Speaker 1: different than their typical candidate. Because Uh, the FED works

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Speaker 1: through the financial channel, and they considered the idea of

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Speaker 1: having somebody from a financial markets background as opposed to

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Speaker 1: a traditional PhD background as a as a candidate, and

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Speaker 1: I was one of the few, if I don't know,

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Speaker 1: maybe the only one that was chosen with that kind

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Speaker 1: of with that kind of background. And so it was

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Speaker 1: it was a very you know, interesting, well uh ranging

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Speaker 1: interview of a lot of different subjects, mainly about FED

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Speaker 1: policy in the economy. So Jim Baith, based upon that

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Speaker 1: interview process, what do you think the FED is is

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Speaker 1: or what do you think the administration is looking for

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Speaker 1: in the FED going forward? I think that you know,

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Speaker 1: if you listen to Larry Cudlow or if you listen

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Speaker 1: to any of the other administration officials, that they do

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Speaker 1: believe that the Phillips curve, this idea that inflation and

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Speaker 1: the employment or growth are somehow linked in a predictable manner,

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Speaker 1: has been broken down. That you could see again today

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Speaker 1: in the payroll report two four thousand jobs created and

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Speaker 1: there was no uptick in wage growth. This is just

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Speaker 1: basically thrown all of the FED models and all of

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Speaker 1: the economic models forget to FED, all the economic models

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Speaker 1: you know, on their ear because this wasn't supposed to happen,

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Speaker 1: meaning that when you have the economy growing this fast

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Speaker 1: and you have an unemployment this low for this longer

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Speaker 1: period of time to really show no major worries about

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Speaker 1: wage inflation, let alone overall inflation. I think that that's

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Speaker 1: been a big theme of THEIRS. It's been a big

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Speaker 1: theme of mind and a number of other people as

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Speaker 1: well too, that we are in a different type of

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Speaker 1: inflation world and we don't need to have interest rates

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Speaker 1: as high as we did, say in previous cycles, when

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Speaker 1: the relationship between unemployment inflation was different. So, Jim, when

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Speaker 1: we asked about the jobs report, when Paul asked you,

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Speaker 1: you said, Uh, it just sort of confirms that if

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Speaker 1: the Fed made a mistake in December and that they

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Speaker 1: should keep rates lower than where they are currently and

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Speaker 1: reverse the mistake in December and accommodate more. And I'm

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Speaker 1: trying to figure out what the goal of the Fed here,

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Speaker 1: I mean, how much will that actually boost the real

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Speaker 1: economy for the Federal Reserve to cut rates by basis points.

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Speaker 1: Some traders are now predicting, Yeah, you know a lot

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Speaker 1: of people asked that question a lot. You know that

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Speaker 1: in the assumption there is that nobody cares about the

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Speaker 1: level of interest rates, that if you were to lower

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Speaker 1: interest rates, that that would not be anywhat of a

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Speaker 1: stimulus towards mortgages and the housing market, or towards autos

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Speaker 1: and auto loans. You know, Wall Street doesn't nobody, nobody

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Speaker 1: in Wall Street bothers with interest rates. They're not at

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Speaker 1: all interested in whether or not they move up or down.

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Speaker 1: Of course, this is all ridiculous. It is an important

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Speaker 1: factor in the economy, and I do think that if

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Speaker 1: nothing else, what we're doing is correcting an imbalance, that

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Speaker 1: the rates are too high, and that it may not

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Speaker 1: necessarily mean that we're trying to stimulate the economy by

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Speaker 1: lowering them, but more along the lines of we're trying

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Speaker 1: to stop hurting the economy by keeping them where they

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Speaker 1: are now. The inverted yield curve, that is a signal

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Speaker 1: that that is that the yield on the tenure note

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Speaker 1: is lower than the yield on the three month bill.

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Speaker 1: That is a signal that rates are too high, and

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Speaker 1: that if we leave that in place for month after month,

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Speaker 1: and that would happen if we didn't cut rates, that

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Speaker 1: cumulative effect could really retard the economy, and so I

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Speaker 1: think that that needs to be respected and that what

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Speaker 1: we're probably doing here not is injecting stimulus, but removing restrictiveness.

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Speaker 1: I know a lot of people have a hard time

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Speaker 1: with this, thinking how can two and a half percent

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Speaker 1: interest rates be restrictive because they've got this long history,

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Speaker 1: and how will remind them it's one of the highest

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Speaker 1: developed world rates in the world. Everybody else is lower,

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Speaker 1: and there's twelve trillion dollars almost thirteen of negative interest rates.

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Speaker 1: We are an outlier and that is why it is restrictive,

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Speaker 1: because rich interest rates should be viewed in context with

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Speaker 1: all other interest rates. Jim Bianco, always a wonderful thing

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Speaker 1: having you on the show. Thank you so much for

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Speaker 1: spending your post July four Friday with us. Jim Bianco,

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Speaker 1: President and founder of Bianco Research, also someone who has

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Speaker 1: interviewed A four A an open fed position by the

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Speaker 1: current White House. When it comes to Deutsche Bank, the

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Speaker 1: question is how far will its planned cuts go, not

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Speaker 1: whether there will be cuts and where will those cuts

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Speaker 1: be most focused? Joining us down to talk about that.

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Speaker 1: Stephen Aaron's, German banks reporter for Bloomberg News, joining us

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Speaker 1: from Frankfort. Stephen, I want to just talk about the timeline.

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Speaker 1: We've been talking about Deutsche Bank for a while. Are

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Speaker 1: we getting closer to the bank actually announcing some sort

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Speaker 1: of restructuring plan that we can then view as fact. Absolutely,

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Speaker 1: we're moving. We're moving much closer the the supervisory board

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Speaker 1: meaning that is likely to adopt the plan will take

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Speaker 1: place on Sunday. We've been told the bank hasn't officially CONFIRMEDNUS,

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Speaker 1: but it's very likely to happen, and that will then

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Speaker 1: trigger under German securities law, will trigger a a obligation

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Speaker 1: to inform the market. So expect something on Sunday. Uh

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Speaker 1: And in fact, the the the announcement has already begun,

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Speaker 1: with the bank saying today that the investment banking had

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Speaker 1: god Ritchie's leaving the bank. So that's the first instance

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Speaker 1: of the whole big plan now moving into action. So, Stephen,

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Speaker 1: how expansive do you expect the restructuring to be. It's

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Speaker 1: going to be big, possibly or even probably the biggest

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Speaker 1: restructuring of Dutch Bank and its investment banking division, particularly

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Speaker 1: in in decades. The job clubs could reach up to

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Speaker 1: twenty tho probably stretched out over several years, but still

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Speaker 1: it's a very large number. It's it would be more

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Speaker 1: than fifth of the current workforce. The cuts will also

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Speaker 1: very much hit the US. Again, it's not clear over

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Speaker 1: what timeline and just how much, but it's clear that

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Speaker 1: the face of the U S operations will will fundamentally change.

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Speaker 1: There has been some uh some speculation, including by as

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Speaker 1: published in Bloomberg News, that Deutsche Bank will get out

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Speaker 1: of equities, trading, sales, research, etcetera. In the United States

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Speaker 1: also that potentially could largely just newter the investment bank.

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Speaker 1: We did see the investment banking chief of Deutsche Bank

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Speaker 1: leaving the bank today or at least announcing that he

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Speaker 1: is going to be departing. What will the restructure Deutsche

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Speaker 1: Bank look like. It's going to be much more focused

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Speaker 1: on companies, large companies and European large companies then it

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Speaker 1: has been, and shifting away from a previous focus on

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Speaker 1: institutional investors. So the trading components for those investors trading equity,

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Speaker 1: these trading fixed income will be lower, especially over time,

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Speaker 1: and parts that that cater to the capital markets needs

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Speaker 1: and then the general banking needs of leuch corporate such

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Speaker 1: as trade finance, cash management. Those businesses will will like

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Speaker 1: her grow, Steve, do you expect Deutsche Bank in any way,

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Speaker 1: shape or form to uh admit that they have I

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Speaker 1: guess given up their aspirations to be a truly global

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Speaker 1: investment bank here. I mean, they're not gonna say it

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Speaker 1: like that, right, They're gonna They're gonna highlight just that

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Speaker 1: they continue to have a global footprint. I'm not sure

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Speaker 1: they're gonna completely shutter any any in outposts any countries completely.

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Speaker 1: They probably, as you said, they may shut it completely

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Speaker 1: the US equities, but it's not clear whether any countries

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Speaker 1: will completely be dissolved the presence there so they will

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Speaker 1: continue to head at the global presence. But yes, they

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Speaker 1: will admit that there are your your focused banks. They

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Speaker 1: have been admitting this actually for a while, and they're

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Speaker 1: not going to claim anymore that they can still compete

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Speaker 1: with the big US investment banks that now in the

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Speaker 1: trading area especially have a much bigger presence than Deutsche Bank.

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Speaker 1: Bank shares today up three point eight percent. I'm looking

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Speaker 1: at the A d R s in the United States.

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Speaker 1: I'm wondering whether there's any discussions still about a possible merger.

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Speaker 1: I know that Commerce Bank and TB. We're looking at

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Speaker 1: a potential tie up that fell through. Is that basically

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Speaker 1: off the table? That concept definitely? For now. This restructuring

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Speaker 1: now will is designed to happen without any big murder.

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Speaker 1: They're still looking to grow their asset management business DWS.

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Speaker 1: They're looking for takeovers there, but the bank itself is

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Speaker 1: not currently looking at anything. They were previously talked with

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Speaker 1: with Commerce bank A as you said, and they've even

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Speaker 1: had some brief informal talks with ubs, but for as

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Speaker 1: long as the share price is a low as it

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Speaker 1: is now, that's not something that will happen, Steve. Do

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Speaker 1: you expect Deutsche Bank to address the home market Germany? Uh,

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Speaker 1: the concerns that it's tremendously over banked. Um. Kind of

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Speaker 1: what is their strategy to try to shore up the

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Speaker 1: profitability of their core market, job cuts and cost cuts

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Speaker 1: Again in a nutshell, they earning money in the German

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Speaker 1: freetail markets are extremely difficult. Interest rates set by the

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Speaker 1: central banks are extremely low and so margins are low

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Speaker 1: and compared to the competition is extremely tough. So the

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Speaker 1: only way you can actually boost profitability is by taking

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Speaker 1: out costs. And they have said that they continue to

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Speaker 1: aim cutting the workforce in the German retail and commercial

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Speaker 1: clients business by about two thousand a year. That's going

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Speaker 1: to continue and uh and so we'll see if that

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Speaker 1: at some point will actually yield a profitability that they

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Speaker 1: think is sufficient. Steve Aarons, thank you so much. Steve

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Speaker 1: as a German banks reporter Bloomberg News based in Frankfurt,

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Speaker 1: focusing on Deutsche Bank at least. I'm not sure if

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Speaker 1: you know this about me, but I am quite the

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Speaker 1: grill master. I can cook just about anything on the

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Speaker 1: grill and in a suit, and oftentimes in the full disclosure,

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Speaker 1: Paul Sweeney has gone full cash today talking. We're talking

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Speaker 1: full cash Paul Sweeney style, which is basically is pajamas

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Speaker 1: with khakis and and and and in a collar shirt

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Speaker 1: but not a suit exactly. So I mean, I think

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Speaker 1: I've cooked just about anything there is to cook on

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Speaker 1: a grill. But this Bloomberg Business Week, they were out

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Speaker 1: with a story today that is making me rethink my strategy.

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Speaker 1: Kate Crater. Kate is the food editor for Bloomberg Pursuits. Kate,

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Speaker 1: thanks so much for joining us. This is articles, It's

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Speaker 1: just fantastic. It's basically what not to grill on a grill,

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Speaker 1: which is everything, which is almost everything, But let's start

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Speaker 1: with the most obvious. Talk to me about the hamburger thing.

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Speaker 1: I know, yeah, this caused some controversy at my unfortunately

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Speaker 1: life look out this weekend, um yesterday, because we talked

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Speaker 1: to a bunch of chefs and they said, actually, if

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Speaker 1: you want the best burger, you shouldn't put it on

432
00:24:17,119 --> 00:24:20,160
Speaker 1: the grill because you're losing like valuable fat and juices

433
00:24:20,680 --> 00:24:24,480
Speaker 1: is just dripping into the fire. And so we are

434
00:24:24,520 --> 00:24:26,399
Speaker 1: asking people to step away from the grill with the

435
00:24:26,480 --> 00:24:31,280
Speaker 1: burger patties. This is ridiculous. I'm sorry, kay I come on,

436
00:24:31,680 --> 00:24:34,480
Speaker 1: you're basically saying to people, you know, you guys think

437
00:24:34,520 --> 00:24:36,480
Speaker 1: you could grill, but you you kind of you kind

438
00:24:36,480 --> 00:24:38,480
Speaker 1: of stink stink at it. So just stop, I mean,

439
00:24:38,600 --> 00:24:40,399
Speaker 1: give me a break. I mean, is it just the

440
00:24:40,480 --> 00:24:43,359
Speaker 1: optical taste or or what's the I mean, it's basically

441
00:24:43,359 --> 00:24:45,800
Speaker 1: no optical taste. I mean, of course, this is America

442
00:24:45,840 --> 00:24:47,520
Speaker 1: and people can do what they want and they can

443
00:24:47,560 --> 00:24:50,679
Speaker 1: grill whatever they want. But we did. It's um, it

444
00:24:50,760 --> 00:24:53,280
Speaker 1: actually is kind of funny to think, like chefs watch

445
00:24:53,320 --> 00:24:57,159
Speaker 1: amateur cooks um at the grill, maybe like Paul and

446
00:24:57,160 --> 00:24:59,600
Speaker 1: are like, oh, you're doing that wrong. He just he

447
00:24:59,720 --> 00:25:02,800
Speaker 1: just red in the eyes. He's like, I'm no amateur. Right,

448
00:25:03,760 --> 00:25:06,680
Speaker 1: that's okay. Um, So tell us about this this article.

449
00:25:06,760 --> 00:25:09,720
Speaker 1: You guys, you went out and you talk to interviewed

450
00:25:09,800 --> 00:25:12,760
Speaker 1: chefs kind of all over the place about different types

451
00:25:12,760 --> 00:25:16,040
Speaker 1: of food, right, exactly, right, Yeah, it's high grilling season,

452
00:25:16,280 --> 00:25:19,320
Speaker 1: and so you know it really is fun. Like everybody,

453
00:25:19,359 --> 00:25:22,760
Speaker 1: it's the it's high grilling season and food taste solicitus

454
00:25:22,800 --> 00:25:25,240
Speaker 1: on the grill. But in fact, if you want things

455
00:25:25,240 --> 00:25:28,320
Speaker 1: to be perfect, some of some things really shouldn't be

456
00:25:28,400 --> 00:25:31,160
Speaker 1: on shouldn't be cooked on the grill. So something like burgers.

457
00:25:31,160 --> 00:25:33,640
Speaker 1: Of course, I'm not sure how many people we really

458
00:25:33,680 --> 00:25:36,760
Speaker 1: are going to dissuade from from putting patties on the grill,

459
00:25:37,080 --> 00:25:40,080
Speaker 1: but some things like you see them in restaurants, santy restaurants,

460
00:25:40,119 --> 00:25:43,800
Speaker 1: like grilled caesar salad. And it turns out that lettuces

461
00:25:43,920 --> 00:25:46,480
Speaker 1: actually are not very good on the grill because they're

462
00:25:46,480 --> 00:25:49,480
Speaker 1: so full of water that they will wilt and burn

463
00:25:49,760 --> 00:25:52,880
Speaker 1: as you cook them, So you really shouldn't And likewise,

464
00:25:52,920 --> 00:25:56,320
Speaker 1: another stuff from Washington, D C. Doesn't like to grill

465
00:25:56,440 --> 00:26:00,440
Speaker 1: fruit because even though it's sometimes goodt if you grow

466
00:26:00,480 --> 00:26:03,560
Speaker 1: something like peaches, they disintegrate on the grill and they

467
00:26:03,600 --> 00:26:06,040
Speaker 1: also flavor your grill and they pick up any flavors

468
00:26:06,080 --> 00:26:08,560
Speaker 1: that are there. So if you just cook some fish,

469
00:26:09,040 --> 00:26:12,440
Speaker 1: then your peaches are gonna taste like fish. That's so good.

470
00:26:12,600 --> 00:26:15,560
Speaker 1: So I was reading this this article, and I love

471
00:26:15,600 --> 00:26:17,320
Speaker 1: that you did it. It got me really heated with

472
00:26:17,359 --> 00:26:19,560
Speaker 1: a couple of the things. The Burghers really was just like,

473
00:26:19,640 --> 00:26:21,280
Speaker 1: you know, you might as well throw something at the screen.

474
00:26:21,880 --> 00:26:24,200
Speaker 1: You can let us, I mean, okay, whatever, you let

475
00:26:24,240 --> 00:26:26,359
Speaker 1: people do what they want to do. There were some

476
00:26:26,400 --> 00:26:28,760
Speaker 1: good points so, and I will say the whole concept

477
00:26:28,800 --> 00:26:31,800
Speaker 1: of peeled shrimp on a grill, it does drive them out.

478
00:26:31,840 --> 00:26:33,320
Speaker 1: And they were saying that there is a way to

479
00:26:33,400 --> 00:26:36,240
Speaker 1: do it so that it won't dry them out. Right, Yeah, no,

480
00:26:36,320 --> 00:26:38,600
Speaker 1: exactly if you have sell on shrimp, if you buy

481
00:26:38,640 --> 00:26:41,680
Speaker 1: shrimp that aren't you know, that aren't pre peeled, then

482
00:26:41,840 --> 00:26:44,080
Speaker 1: they are marvelous on the grill. That's really good is

483
00:26:44,119 --> 00:26:46,800
Speaker 1: when you peel them, because they're really delicate and they're

484
00:26:46,840 --> 00:26:49,360
Speaker 1: gonna burn. They're either going to burn or not cook well,

485
00:26:49,359 --> 00:26:52,320
Speaker 1: depending on how high your heat is. And we actually

486
00:26:52,359 --> 00:26:54,480
Speaker 1: looked at this a couple of years ago too. And

487
00:26:54,520 --> 00:26:57,359
Speaker 1: another thing that people really shouldn't grill or shishka bab's

488
00:26:57,520 --> 00:26:59,160
Speaker 1: with mixed you know, you see them and they look

489
00:26:59,160 --> 00:27:01,080
Speaker 1: really to me, great, Come on, what are you gonna do?

490
00:27:02,320 --> 00:27:05,760
Speaker 1: A boiler? So I'm gonna on a boiler. But the

491
00:27:05,800 --> 00:27:08,480
Speaker 1: thing that you can do is put the same things on.

492
00:27:08,800 --> 00:27:10,360
Speaker 1: So you can put like all your meat on one

493
00:27:10,400 --> 00:27:13,240
Speaker 1: skewer and then you can put things like cherry tomatoes

494
00:27:13,320 --> 00:27:16,000
Speaker 1: on another. But when you mix them up, the onions, like,

495
00:27:16,040 --> 00:27:17,720
Speaker 1: I don't know if you've ever had them, but it's

496
00:27:17,800 --> 00:27:19,720
Speaker 1: really hard to get onions to cook in a way

497
00:27:19,720 --> 00:27:21,560
Speaker 1: that you want to eat them if it's next to

498
00:27:21,640 --> 00:27:25,440
Speaker 1: something that cooks quickly, like shrimp. So just divide. It's

499
00:27:25,480 --> 00:27:28,240
Speaker 1: just you just make like neat little piles, have each

500
00:27:28,440 --> 00:27:31,159
Speaker 1: have a dedicated kebab, and then you are good to go.

501
00:27:31,280 --> 00:27:33,600
Speaker 1: All right, I'm learning something and learning something, so let's go.

502
00:27:33,760 --> 00:27:35,200
Speaker 1: Let's go to I mean, the one thing that made

503
00:27:35,200 --> 00:27:38,040
Speaker 1: sense to me I saw in your article bacon, uh,

504
00:27:38,200 --> 00:27:39,880
Speaker 1: is that just you know, the kind of the old

505
00:27:39,960 --> 00:27:42,480
Speaker 1: fire hazard things. And I think I've almost you know, said,

506
00:27:43,800 --> 00:27:49,639
Speaker 1: burn your house down. Yeah, fireworks and also uncooked sausages.

507
00:27:49,680 --> 00:27:51,359
Speaker 1: So a lot of people cook something like kill Boss

508
00:27:51,359 --> 00:27:54,119
Speaker 1: that's already cooked and that's fine, like totally grilled that

509
00:27:54,280 --> 00:27:56,879
Speaker 1: grill that would fide be happy. But if you have,

510
00:27:57,200 --> 00:27:59,920
Speaker 1: if you have, there's a lot of these artisanal uncooked

511
00:28:00,000 --> 00:28:02,200
Speaker 1: ossages that you see, you know, links and links of

512
00:28:02,280 --> 00:28:05,520
Speaker 1: them attached, or stick cut bacon, and that is like

513
00:28:05,560 --> 00:28:07,679
Speaker 1: a fire hazard. As you were saying, you know, you

514
00:28:07,680 --> 00:28:09,920
Speaker 1: can start a fire with all the fat in there,

515
00:28:10,119 --> 00:28:13,280
Speaker 1: and it also won't cook well, you know, because it's

516
00:28:13,280 --> 00:28:15,280
Speaker 1: probably gonna burn on the outside while it's still raw

517
00:28:15,320 --> 00:28:17,680
Speaker 1: on the inside, and then you can't eat it, so

518
00:28:18,119 --> 00:28:20,720
Speaker 1: you really shouldn't. And plus like if it's in the

519
00:28:20,720 --> 00:28:23,760
Speaker 1: sausage and it's a casing, it can explode out. So

520
00:28:24,240 --> 00:28:26,320
Speaker 1: there you go. All right, Well, Kate, you said that

521
00:28:26,359 --> 00:28:28,480
Speaker 1: this caused a lot of controversy at the cook out

522
00:28:28,560 --> 00:28:31,760
Speaker 1: that you had yesterday. What were people most jazzed over?

523
00:28:32,040 --> 00:28:37,119
Speaker 1: Most ignited burger? I would say people were most ignited

524
00:28:37,119 --> 00:28:39,640
Speaker 1: over the burgers. They really were, like, you can't tell me,

525
00:28:39,720 --> 00:28:42,680
Speaker 1: top chefs can't tell me how to cook my burgers.

526
00:28:42,720 --> 00:28:46,040
Speaker 1: But you know, actually there were people. I couldn't believe

527
00:28:46,080 --> 00:28:48,960
Speaker 1: I had any support here. But my friend had worked

528
00:28:49,040 --> 00:28:51,160
Speaker 1: as a fry cook for a while at the Beach Club,

529
00:28:51,200 --> 00:28:53,760
Speaker 1: and he was like, it's true. If I'm cooking burgers

530
00:28:53,800 --> 00:28:56,280
Speaker 1: for people who are standing there, I will cook it

531
00:28:56,320 --> 00:28:58,040
Speaker 1: on a grill. But if I'm cooking my own burger,

532
00:28:58,080 --> 00:29:00,360
Speaker 1: I cook it on a flat top. So I have

533
00:29:00,480 --> 00:29:03,719
Speaker 1: some backup. So I see in the you spoke to

534
00:29:04,120 --> 00:29:08,040
Speaker 1: the owner of Latin Latin, you know, Latin Grand Central

535
00:29:08,160 --> 00:29:11,240
Speaker 1: Terminal Um in New York, and they said, yeah, they said,

536
00:29:11,280 --> 00:29:13,840
Speaker 1: do not cook tortillas. That's something I've never even thought

537
00:29:13,880 --> 00:29:16,320
Speaker 1: about cooking. You know what I think when people are

538
00:29:16,360 --> 00:29:18,600
Speaker 1: making tacos, because it's a fun thing to do. You know,

539
00:29:18,680 --> 00:29:21,800
Speaker 1: people are definitely expanding their repertoires on the grill. And

540
00:29:21,840 --> 00:29:24,600
Speaker 1: you see people maybe cooking like chicken that they're going

541
00:29:24,640 --> 00:29:27,960
Speaker 1: to put, you know, in to make tacos with. And

542
00:29:28,000 --> 00:29:31,200
Speaker 1: that's really fun. But and so to facilitate it, some

543
00:29:31,200 --> 00:29:33,960
Speaker 1: people will throw tortillas on the grill. And this guy

544
00:29:34,240 --> 00:29:38,640
Speaker 1: is clearly a purist, the sky Julian Messina, and he's like, Nope,

545
00:29:38,640 --> 00:29:42,040
Speaker 1: don't do it. Just it's better to wrap them in foil,

546
00:29:42,680 --> 00:29:45,120
Speaker 1: or you can you can like keep them on again,

547
00:29:45,160 --> 00:29:48,480
Speaker 1: you can heap them on a plantcha, you know, taking

548
00:29:48,480 --> 00:29:51,000
Speaker 1: a step back, I do have to say, as the

549
00:29:51,120 --> 00:29:55,440
Speaker 1: mother of two boys and who has understood the the

550
00:29:55,480 --> 00:29:58,880
Speaker 1: importance of time, these chefs are kind of opening themselves

551
00:29:59,000 --> 00:30:02,400
Speaker 1: up to sort of criticism that they're not really facing reality.

552
00:30:02,480 --> 00:30:04,600
Speaker 1: I mean, it is so easy to throw things on

553
00:30:04,640 --> 00:30:08,320
Speaker 1: a grill and fast and convenient that the idea of saying, well,

554
00:30:08,360 --> 00:30:11,720
Speaker 1: you know, it's not perfect because maybe leads lightly will

555
00:30:11,800 --> 00:30:14,240
Speaker 1: did is absolutely ridiculous for people who are trying to

556
00:30:14,280 --> 00:30:16,560
Speaker 1: serve a lot of people, or who have small children.

557
00:30:16,720 --> 00:30:19,200
Speaker 1: I mean, is there a caveat here that this is

558
00:30:19,240 --> 00:30:22,200
Speaker 1: just their per personal preferences. Are they basically saying you're

559
00:30:22,200 --> 00:30:24,800
Speaker 1: a heathen if you do it this way? No, I

560
00:30:24,840 --> 00:30:27,040
Speaker 1: think I think all of them will allow. I mean,

561
00:30:27,080 --> 00:30:28,640
Speaker 1: I think it would be hard pressed to find a

562
00:30:28,680 --> 00:30:30,640
Speaker 1: check who was not cooked at burger on a grill.

563
00:30:31,080 --> 00:30:33,160
Speaker 1: So I'm not sure any of them this is like

564
00:30:33,440 --> 00:30:36,560
Speaker 1: the hill they're going to die on. But but they're saying,

565
00:30:36,640 --> 00:30:39,880
Speaker 1: if you want the ultimate burger, like the best burger,

566
00:30:40,160 --> 00:30:42,200
Speaker 1: it really is good cooked on a flat top, because

567
00:30:42,200 --> 00:30:44,680
Speaker 1: then you developed that crust like it gets that delicious

568
00:30:44,760 --> 00:30:48,840
Speaker 1: charred crust caramelized and you're not losing like juices and

569
00:30:48,920 --> 00:30:52,880
Speaker 1: fat to the fire. But I can guarantee you that

570
00:30:53,000 --> 00:30:55,320
Speaker 1: I'm sure they have all cooked burgers on the grill,

571
00:30:55,400 --> 00:30:57,320
Speaker 1: and I'm sure in the future you will be able

572
00:30:57,360 --> 00:31:00,360
Speaker 1: to bust them all cooking burgers on the grill. So, Kate,

573
00:31:00,400 --> 00:31:03,240
Speaker 1: are people in your reporting are you finding that people are,

574
00:31:03,280 --> 00:31:07,320
Speaker 1: you know, grilling as much or more than they used to. Yeah,

575
00:31:07,320 --> 00:31:09,720
Speaker 1: I know people love it and people are grilling year round.

576
00:31:09,720 --> 00:31:11,640
Speaker 1: Now that's the thing. You can buy so many different

577
00:31:11,720 --> 00:31:13,600
Speaker 1: kinds of girls, whether you have like a small city

578
00:31:13,640 --> 00:31:18,479
Speaker 1: apartment or a huge backyard. Um, there's so many different

579
00:31:18,480 --> 00:31:21,320
Speaker 1: growth that are being built now to suit all kinds

580
00:31:21,320 --> 00:31:24,440
Speaker 1: of lifestyles and the way people live. So people love

581
00:31:24,480 --> 00:31:26,760
Speaker 1: to grill. And the other thing that's cool is you

582
00:31:26,760 --> 00:31:29,479
Speaker 1: can grow over all kinds of things. You know, used

583
00:31:29,520 --> 00:31:32,200
Speaker 1: to be the people were which is maybe talk about would,

584
00:31:32,200 --> 00:31:34,240
Speaker 1: but now they talk about a specific kind of wood

585
00:31:34,320 --> 00:31:36,640
Speaker 1: that they want to cook on. People are really geeking

586
00:31:36,680 --> 00:31:40,120
Speaker 1: out on it and it's kind of fantastic. So Kate,

587
00:31:40,280 --> 00:31:42,800
Speaker 1: if you are going to a barbecue at someone's house,

588
00:31:43,080 --> 00:31:45,560
Speaker 1: what should you bring to the barbecue as a guest,

589
00:31:46,680 --> 00:31:50,600
Speaker 1: that's a great less um. I think. I always think

590
00:31:50,640 --> 00:31:53,840
Speaker 1: it's good to bring a bottle of rose because it's

591
00:31:53,880 --> 00:31:56,800
Speaker 1: the drink of the summer, you know, and you know,

592
00:31:56,960 --> 00:31:58,600
Speaker 1: then you don't have to fight about what people are

593
00:31:58,600 --> 00:32:01,160
Speaker 1: going to grill on, you know, whether or not you

594
00:32:01,160 --> 00:32:04,160
Speaker 1: should be grilling those burger patties. But um, what kind

595
00:32:04,160 --> 00:32:08,400
Speaker 1: of barbecues you go to? One more people drink a

596
00:32:08,440 --> 00:32:12,440
Speaker 1: lot of rose, I guess, But but I think, um,

597
00:32:12,480 --> 00:32:15,080
Speaker 1: I think that's always a good thing. I think bringing

598
00:32:15,120 --> 00:32:18,560
Speaker 1: dessert is good. You can find so many great, you know,

599
00:32:18,600 --> 00:32:21,600
Speaker 1: packaged cookies and they come in like these really cool tins,

600
00:32:22,200 --> 00:32:24,800
Speaker 1: or you know what else is there? You know what?

601
00:32:24,920 --> 00:32:27,000
Speaker 1: Actually I brought to a party the other day because

602
00:32:27,040 --> 00:32:30,200
Speaker 1: it's like such prime season as strawberries. So no I

603
00:32:30,240 --> 00:32:32,560
Speaker 1: would eat cookies. But if you can find the fruit

604
00:32:32,600 --> 00:32:35,480
Speaker 1: that's in season, there's so many farmers markets now, and

605
00:32:35,480 --> 00:32:38,440
Speaker 1: if you get just like a really nice little basket

606
00:32:38,440 --> 00:32:41,760
Speaker 1: of something, there's nothing better than that. Kay creator, thank

607
00:32:41,760 --> 00:32:44,160
Speaker 1: you so much, Katis food editor, if you couldn't tell

608
00:32:44,360 --> 00:32:47,440
Speaker 1: for Bloomberg Pursuits and just a fantastic article in the

609
00:32:47,440 --> 00:32:50,600
Speaker 1: Bloomberg Business Week magazine. It's essentially the takeaways kind of

610
00:32:50,600 --> 00:32:53,400
Speaker 1: what not to grill and why, and it's and the

611
00:32:53,640 --> 00:32:56,560
Speaker 1: y comes from some famous chefs who kind of, you know,

612
00:32:56,680 --> 00:32:58,640
Speaker 1: they kind of know where they're doing. Thanks for listening

613
00:32:58,640 --> 00:33:01,360
Speaker 1: to the Bloomberg Penl podcastst You can subscribe and listen

614
00:33:01,400 --> 00:33:04,760
Speaker 1: to interviews at Apple Podcasts or whatever podcast platform you prefer.

615
00:33:05,120 --> 00:33:07,920
Speaker 1: Paul Sweeney, I'm on Twitter at pt Sweeney. I'm Lisa

616
00:33:07,920 --> 00:33:10,560
Speaker 1: abram Woyit's I'm on Twitter at Lisa abram woits one

617
00:33:10,760 --> 00:33:13,400
Speaker 1: before the podcast. You can always catch us worldwide on'm

618
00:33:13,400 --> 00:33:14,240
Speaker 1: Bloomberg Radio