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Speaker 1: Yeah, Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keene

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

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

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

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Speaker 1: I'm ready pleased to say that joining us now from

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Speaker 1: London is Robin Niblett. He has served as the director

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Speaker 1: of Channel House for the last decade and he joins

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Speaker 1: us from London from Brussels, actually, and he was formerly

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Speaker 1: the executive vice president and chief operating officer of the

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Speaker 1: Center for Strategic and International Studies in Washington, d C.

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Speaker 1: Robin Nibble always great to get your insight on all

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Speaker 1: things foreign policy. And on this particular issue, is this

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Speaker 1: President Trump's Nixon goes to China moment. Well, um, we

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Speaker 1: don't know where he's going to yet, which is a problem.

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Speaker 1: And I don't think the situation between the United States

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Speaker 1: and North Korea there's any real resemblance of the situation

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Speaker 1: dwin the United States and China either that period or before,

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Speaker 1: not at least given the fact that China even then

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Speaker 1: was emerging as a potential balancer in world order. This

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Speaker 1: is much more a case of having to deal with

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Speaker 1: a very specific threat to regional and US security. So

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Speaker 1: I think that the scope for the kind of grand

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Speaker 1: bargains sort of deal that Nixon goes to China implies

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Speaker 1: is not available for this much more specific tactical problem. Robin,

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Speaker 1: is the Chinese wake up to that news earlier on today?

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Speaker 1: What is President she? What do you think he's thinking

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Speaker 1: of this? The prospect of this meeting happening, so I

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Speaker 1: think you think is good. Um good in the sense

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Speaker 1: that the Chinese North Cana relationship is very scratchy, very difficult,

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Speaker 1: and the Chinese are increasingly exasperated with the steps taken

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Speaker 1: by Kim yongan. Anything that delays a further increase intentions,

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Speaker 1: which I think people expected to happen after the Olympics.

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Speaker 1: Many people thought the Olympics would be a lull and

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Speaker 1: then that Kim yongan would go back to testing the

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Speaker 1: next set of missiles. So the fact that actually they're

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Speaker 1: building on the moment of their chance that those Winter

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Speaker 1: Olympics brought, I think from the Chinese perspective as team

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Speaker 1: as very positive. It also means that the sanctions are

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Speaker 1: probably working a bit or certainly you could argue that

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Speaker 1: this might be partly driven by the sanctions, and the

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Speaker 1: Chinese certainly didn't want to go any further than they've

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Speaker 1: gone so far, so they can show a bit of progress. Robins.

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Speaker 1: To what extent will the Chinese be worried about North

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Speaker 1: Korea falling into the American orbit? Not at all, in

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Speaker 1: my opinion, Seriously, I mean they're they're not even fully

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Speaker 1: in the Chinese orbit. Um. As we discovered even during

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Speaker 1: the Cold War, small countries and sometimes able to manipulate

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Speaker 1: big ones um. And North Korea has done a very

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Speaker 1: good job manipulating everyone so far. Um. I don't think

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Speaker 1: that they're concerned about them falling into America's lap. Robin

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Speaker 1: Dubarrow from Professor and I Uh and his classic textbook

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Speaker 1: with Mr Kane Uh Power in interdependence? What is the

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Speaker 1: president's power here? And what is the president's interdependence with

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Speaker 1: the Washington foreign policy establishment? I don't pretend to see

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Speaker 1: any is there any well? His power I think comes

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Speaker 1: simply from the fact that he is the government and

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Speaker 1: he represents the government. But the North Koreans have always

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Speaker 1: wanted to do the deal with China, They don't want

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Speaker 1: to do the deal with South Korea. They want to

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Speaker 1: do the deal with the US. Second bit of power

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Speaker 1: that he has in the end, it's that a meeting

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Speaker 1: with the president of the US is a huge thing

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Speaker 1: to give to the leader of North Korea. What do

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Speaker 1: we get? What do we but Robin, this is critical,

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Speaker 1: But Robin max but brought this up in the Wall

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Speaker 1: Street Journal today. I get that, I get the photo up,

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Speaker 1: I get the handshakes, blah blah blah. What do we

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Speaker 1: get in return for his legitimacy? I tell you that

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Speaker 1: this is what worries me about it. You asked me

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Speaker 1: what the power of the US has, it has the

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Speaker 1: visit of the present. We seem to be giving the

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Speaker 1: power that one of the key giveaways right now without

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Speaker 1: any sense of what will come in return. The North Koreans, remember,

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Speaker 1: you know, claim that they've given up their plutonium Richmond's

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Speaker 1: plan about ten years ago, to turn out that they

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Speaker 1: had a secret uranium plan um in Richmond plan going

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Speaker 1: on alongside. So I'm I'm concerned. I have to say

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Speaker 1: that the President is stepping forward potentially too early, where

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Speaker 1: more traditional, cautious steps forward would have been a better

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Speaker 1: early step in this process, such as, for example, not

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Speaker 1: you know, holding off on some of the US military

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Speaker 1: exercises for a period um. Yeah. So in terms of

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Speaker 1: using the power, I think the US has brought out

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Speaker 1: the big gun before you know what you're gonna get

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Speaker 1: in return for it to what extent. Robin just sort

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Speaker 1: of extrapolating this and broadening at a little bit, So

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Speaker 1: what EXTENSI would we worry that to really validate yourself

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Speaker 1: in the eyes of the United States, you need nuclear

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Speaker 1: weapons and if you built them quick enough, you get

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Speaker 1: a meeting with the president. Uh. You know, it's not

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Speaker 1: only that. This is the sense that you know, a

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Speaker 1: country with nuclear weapons is one that I think the

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Speaker 1: North Korean regime of Kim yongan and his predecessors, his

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Speaker 1: father and grandfather all believe they needed to follow the

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Speaker 1: China model. China in the nineties fifties was deeply threatened

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Speaker 1: both by the United States and that point by the

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Speaker 1: Soviet Union. They acquired a nuclear capability and then on

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Speaker 1: the back of that they were able to develop their economy.

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Speaker 1: I think Kim yongan is trying to follow precisely the

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Speaker 1: same model, which is why I'm highly skeptical that he

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Speaker 1: really is committed to be nuclearization. Um, he has watched

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Speaker 1: what's happened, what happened to Iraq, he watched what happened

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Speaker 1: to Libya. Um, you know his lesson. And even if

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Speaker 1: you were to do a deal with us, even if

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Speaker 1: you're to do it, always do as look what tem

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Speaker 1: to Irun, which seems to have done a deal with us,

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Speaker 1: and then you discover the United States can't follow through

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Speaker 1: on it. The lack of trust, you know, in successive

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Speaker 1: administrations is a huge problem. So my read of this

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Speaker 1: at the moment is, you know, both sides want to

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Speaker 1: show that they're reducing tensions. Neither side has worked out

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Speaker 1: how to turn this into a real deal. Robin Niblett

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Speaker 1: joining us from Brussels, the director of Channel House. We

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Speaker 1: always appreciate your insight, sir, Thank you very much. What

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Speaker 1: a crazy, crazy week this is being Tom Kane. Do

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Speaker 1: you remember that time Gary Coin left the White House?

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Speaker 1: Do you remember when he resigned his ancients? It feels

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Speaker 1: like a long time ago. Johanet really speaks to the

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Speaker 1: news cycle and the ad hoc nature of policymaking. I

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Speaker 1: want to, you know, step lightly here, folks, because everybody

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Speaker 1: has different politics and different political opinions. But I think, Kevin,

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Speaker 1: we need to say thank you to our team and

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Speaker 1: to our Washington team. We're trying to piece all this together.

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Speaker 1: Shout out particularly to Margaret Tollive of our White House

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Speaker 1: team for her work. Joining us now on Job's Day,

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Speaker 1: and I know John wants to get the job's day

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Speaker 1: as Michelle Meyer a Bank of America Mary Lynch. And

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Speaker 1: what's important about Michelle Meyer for those who keep score,

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Speaker 1: is brilliant housing micro study of eight, nine, ten years ago.

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Speaker 1: She was way out front with a housing recovery and

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Speaker 1: his nuances in America. So forget about jobs Day, Michelle

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Speaker 1: give us an update is how Michelle Meyer sees the

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Speaker 1: American housing economy before we dive into jobs. Sure, and

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Speaker 1: thanks for that, Tom um So. I think for for housing,

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Speaker 1: the recovery is ongoing. We have um real clear evidence

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Speaker 1: that UM demand is still improving. And one I think

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Speaker 1: that's been actually particularly in uraging to us is that

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Speaker 1: we're seeing evidence of entry level homebuyers returning into the market.

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Speaker 1: Um So, if you look at the homeletership rates broken

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Speaker 1: down by age cohort uh, the aging millennial is now

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Speaker 1: starting to shift from the renting market to the owning market. Um.

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Speaker 1: And that's a really good sign because that shows first

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Speaker 1: time homebuyers in the market, incremental demand. Now it does

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Speaker 1: mean it's further working down the supply of homes, which

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Speaker 1: could continue to put some upper pressure on home prices,

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Speaker 1: which is a phenomenon we've seen now for the past

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Speaker 1: several years as a recovery persists. One more question, how

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Speaker 1: is he going to know? John wants to beat you

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Speaker 1: over the head on jobs. But this this was a

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Speaker 1: chart one weekend, two weekends, I can't remember. Three weeks

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Speaker 1: ago Dean Baker, the great liberal economists, and Dean Baker said, look,

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Speaker 1: here's inflation, and here's inflation without shelter. His Michelle Meyer

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Speaker 1: taken into account our inflation exing out idiots city pricing

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Speaker 1: like San Francisco, Knew or Boston, Washington and the rest.

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Speaker 1: Have you done the homework of taking out the housing

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Speaker 1: boom of those cities and folding it into inflation. Yep.

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Speaker 1: So if you look at course CPI or even course

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Speaker 1: services inflation X shelter, it's much more muted. Um. So

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Speaker 1: the shelter component, particularly it's called owner's equivalent rent, which

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Speaker 1: is a proxy for housing costs UM, has accelerated faster

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Speaker 1: than other aspects of underlying inflation UM. And I think

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Speaker 1: that that reflects the fact that we've had this very

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Speaker 1: tight market uh and and one where uh, you know,

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Speaker 1: people have had to allocate more of their their their

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Speaker 1: income towards renting and even towards home ownership as well. UM.

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Speaker 1: So if you look at evaluation metrics housing versus income growth,

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Speaker 1: for example, UM, home prices have been picking up relative

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Speaker 1: to the pace of income. Now, we're so far from

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Speaker 1: the bubble lebble period UM, but certainly things have have

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Speaker 1: moved up. And if you look at certain key markets

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Speaker 1: like as you point out, part of the West coast

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Speaker 1: San Francisco, for example, Praise in San Francisco or above

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Speaker 1: the bubble peak, and they're notably above the bubble peak.

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Speaker 1: Can we do payrolls now? Yes, I'm ready. I just

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Speaker 1: want to get housing update, all right, you're going into

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Speaker 1: real estate a little bit. I'm just trying to work.

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Speaker 1: I think I do, John, seriously, I do think they're linked.

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Speaker 1: I think the housing economy and job and wage growth

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Speaker 1: is I think you're right. I was just joking, Michelle

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Speaker 1: let's talk about payrolls. What do you look? It's a

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Speaker 1: non joking Friday, definitely serious is Friday? What are you

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Speaker 1: looking for today? Help me sure? So to me? You know,

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Speaker 1: with pierrolls, we always talked about non from para growth

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Speaker 1: as a headline measure, which matters and and but I

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Speaker 1: think actually markets um an economist broadly are going to

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Speaker 1: be a bit more focused on a wage data because

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Speaker 1: that's where and it goes back to, you know, hating

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Speaker 1: about home praises and inflation. That's where there's been a

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Speaker 1: bit of a missing link in terms of whether or

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Speaker 1: not we're truly seeing a move up in wage inflation.

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Speaker 1: Last month gave us some indo casition of that. Certainly

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Speaker 1: with the two point nine percent average early earnings this month,

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Speaker 1: we think it's going to be a little bit softer,

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Speaker 1: so we're looking for a point two percent month or

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Speaker 1: month increase and it actually does push the year rear

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Speaker 1: down attempts at two point eight percent, So it's not problematic.

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Speaker 1: It's not a sign that you know, wages are going

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Speaker 1: to be stuck at low levels, but it does remind

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Speaker 1: everyone that this is a slow process, that it's going

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Speaker 1: to be a gradual and probably bumpy trend up for

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Speaker 1: for wages. Well, that's what I wanted to ask you, Michelle. Historically,

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Speaker 1: when unemployment gets as low as it has done, robout

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Speaker 1: to test four percent possibly today, When it gets that low,

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Speaker 1: does wage growth start to accelerate quickly in the preceding

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Speaker 1: months or is this a slow grind tire as wage

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Speaker 1: growth dips a little bit lower and grinds lower. Well,

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Speaker 1: that's one of the questions around the Phillips curve. So

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Speaker 1: in theory, the standard Fields curve, which is the relationship

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Speaker 1: between unemployment slack and and and and wage growth or

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Speaker 1: or CPI or pletion um. Standard typically think that um

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Speaker 1: there's not necessarily an asymmetry that you know, as the

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Speaker 1: unemployment rate falls, you continue to incrementally boost inflation. Once

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Speaker 1: it reaches nehru um, you know, you get you get

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Speaker 1: that much more UM pressure because you're at a higher

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Speaker 1: level for wages. Now, the question is, you know, is

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Speaker 1: there some sort of nonlinear or asymmetry where you fall

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Speaker 1: below neighrou and the deeper refall below neighbor, the more

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Speaker 1: that response actually starts the matter in terms of price

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Speaker 1: pressures building. And that's possible and that's something that FEED officials,

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Speaker 1: I think are a bit concerned about. We've heard a

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Speaker 1: number of FED officials talk about this idea that we

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Speaker 1: don't really know what's going to happen when the unemployment

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Speaker 1: rate falls significantly further, and we don't want to be

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Speaker 1: caught too much behind the curve where all of a

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Speaker 1: sudden we actually see an abrupt move up in these

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Speaker 1: price pressures, where they say, I would have to respond

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Speaker 1: quickly and maybe in a way that would be disturbing

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Speaker 1: for the economy just to broaden this out, just to

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Speaker 1: broader price pressures full stop in the American economy at

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Speaker 1: the moment. Is there a seasonality so all of this,

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Speaker 1: it just feels like that an respring of any given

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Speaker 1: year reflation forces pick up and then they roll over

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Speaker 1: again into year end. Um. What is that about? Well,

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Speaker 1: there is there's so much seasonality and the economic data

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Speaker 1: as we know, both on the real side of the

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Speaker 1: economy and inflation side. For inflation, there there's a seasonal

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Speaker 1: bias in the January numbers. So we ever we start

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Speaker 1: out the year with very strong inflation prints UM January

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Speaker 1: core CPI corp PC tend to come in UM pretty

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Speaker 1: you know, notably stronger than the trend for the rest

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Speaker 1: of the month. So that kicks off this optimism around

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Speaker 1: the idea that we can see higher inflation and then

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Speaker 1: it reverses or softens into the rest of the year.

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Speaker 1: And around wages. You know this this year in particular,

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Speaker 1: you've had a number of kind of special factors. So

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Speaker 1: we had the one off bonus payments UM that presumably

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Speaker 1: influenced the employment costs index not the average earlier earning numbers,

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Speaker 1: but but other wage measures UM. And then there's a

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Speaker 1: question around how quickly or how impactful the test legislation

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Speaker 1: will be in terms of also generally eating wage pressures.

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Speaker 1: And that's kind of a headline risk that I think

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Speaker 1: a lot of people are trying to understand. I mean,

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Speaker 1: Carl Rick and DONI had a great observation today, Michelle.

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Speaker 1: It's only it's his March observation. Like weather really gets

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Speaker 1: into this, Like a school teacher in the follow New

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Speaker 1: York if they are out to snow days, which is common,

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Speaker 1: that changes the hours ratios, doesn't it for sure? And

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Speaker 1: that we think was a big factor last month. So um,

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Speaker 1: you know, the work week in January was down sharply

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Speaker 1: because we had some pretty unfortunate weather in the beginning

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Speaker 1: of the month. UM, so people were unable to report

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Speaker 1: to work because the work week was down average early

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Speaker 1: earnings just the map with that, you know, decline the

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Speaker 1: work week, your average earlier earnings are going up equal

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Speaker 1: so UM this month we think that's that's that's the

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Speaker 1: key reason we expect this softening and wage growth this

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Speaker 1: month is because the work week will pick up in

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Speaker 1: February didn't have the same type of weather events and

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Speaker 1: as a result, you will see some pack da Michelle,

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Speaker 1: Thank you so much. Michelle Myer Housing on jobs with

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Speaker 1: Bank of America Maryland. John, I think you're dead on

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Speaker 1: and what I would say as a fossil, I really

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Speaker 1: don't recall the seasonality decades ago, and I've seen some

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Speaker 1: studies that say I'm wrong. It's always been soundly influences

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Speaker 1: markets and the bias of some market parts. We were

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Speaker 1: in his focus then as we are now. I can

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Speaker 1: tell you I'm looking for some property for you between

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Speaker 1: Park and Madison on seventy six, which I know is

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Speaker 1: very close to um a bar of yours which would

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Speaker 1: give you your lake. Greig ken Pruitt would say, does

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Speaker 1: it have a w BF with burning stone or whatever

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Speaker 1: you used to say to the Carlisle there, Well, that

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Speaker 1: would be true. You know, between Park and Madison and

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Speaker 1: seventy six, we'll get you some options. Expands my options.

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Speaker 1: There's no question. Get Michelle Martin. I don't want to

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Speaker 1: know what the teriff is. You've got to be a

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Speaker 1: real friend with some real money. Good to talk to

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Speaker 1: Michelle Meyer about America's housing economy, I would respectfully suggest,

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Speaker 1: very different from New York's housing economy. Government just walks

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Speaker 1: past the studio and walks in and he joins us

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Speaker 1: about from Well, I'm glad to bring it up, John Folks.

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Speaker 1: You go, why are we at Bloomberg? Why are we

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Speaker 1: doing Bloomberg surveillance? And this is it. We had Alan

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Speaker 1: Krueger were this earlier, and other wonderful economists. And they

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Speaker 1: have a former Federal Reserve System Governor Randall Crosser of Chicago,

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Speaker 1: truly the nation's expert on financial economics as well. What's

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Speaker 1: the rate of change of the I S curve? I mean,

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Speaker 1: we've got the impulse of tax cut, we've got the

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Speaker 1: impulse of fiscal stimulus. Numbers you can't imagine if you

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Speaker 1: take the classic nine teen thirty nine Hicksie and model,

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Speaker 1: what's the shiftiness of the real economy right now? Do

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Speaker 1: you have a even a handle on that. It's hard

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Speaker 1: to know the exact number, but um, I think, as

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Speaker 1: you said, there are a lot of things that are

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Speaker 1: going well for the economy. We've got very strong global

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Speaker 1: global growth. That's rare to have this kind of synchronized

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Speaker 1: global growth, so that's good. Overall, We've got very solid

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Speaker 1: basic economic growth for the last year that seems to

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Speaker 1: be speeding up, perhaps because of the tax reforms and

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Speaker 1: some of the regulatory reforms. So that's all helping to

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Speaker 1: increase demand. The key thing is how much is it

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Speaker 1: going to help on the supply side. Is it going

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Speaker 1: to help to increase productivity? That's the key thing that

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Speaker 1: the FED is going to be concerned about. Do they

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Speaker 1: have the luxury of white sink to find out? Well, Um,

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Speaker 1: we'll have to see. Obviously, we're gonna see some numbers

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Speaker 1: in just a few minutes about the job market and

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Speaker 1: wage pressure. But they're going to have they're obviously going

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Speaker 1: to be making forecasts about how much of this is

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Speaker 1: actually gonna help on investment, how much this is going

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Speaker 1: to help on the productivity side, because if you get

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Speaker 1: lots of fundamental growth on the productivity side, the FED

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Speaker 1: doesn't have to try to raise rates as much because

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Speaker 1: it's not a as inflationary. But I guess you've got

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Speaker 1: to wait and wait and see, and then wait a

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Speaker 1: several more months, and then you may find yourself behind

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Speaker 1: the curve. So the big question, I think the Federal

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Speaker 1: Reserve probably has the hardest job it's has for a

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Speaker 1: long long time. Now, Professor, what's the prudent monetary policy

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Speaker 1: response to all of this? Do you get ahead with four,

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Speaker 1: do you sit back and do two, or do you

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Speaker 1: go with three? Well, you know, the FED always likes

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Speaker 1: to take the balance view, so probably three is the

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Speaker 1: reasonable one at the moment, but you know, it will

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Speaker 1: depend on how the data are starting to evolve. When

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Speaker 1: the FED has trying to stay ahead of the curve.

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Speaker 1: Because obviously the FED has been raising rates and has

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Speaker 1: raised rates reasonably significantly, even though in the inflation rate

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Speaker 1: has been below its two percent target, that suggests that

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Speaker 1: it's trying to be ahead of the curve. It gives

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Speaker 1: it a little bit of flexibility to sort of wait

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Speaker 1: and see. Your colleague, in Crime at Chicago. Mr Levitt,

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Speaker 1: I'm honored to say I did his first interview of

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Speaker 1: fre Economics years ago. He finishes up that hugely successful

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Speaker 1: tone with two paths to Harvard on many many years

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Speaker 1: from fre Economics, everybody's linking education back into our labor economy.

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Speaker 1: People are bored with what economists say. We all know

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Speaker 1: we need more education. What's the crossner immediate application to

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Speaker 1: jump start education in America, whether it's two, three or

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Speaker 1: four pass to Harvard. So I agree that people are

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Speaker 1: tired of hearing about education. Unfortunately, it is true that

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Speaker 1: that's one of the most important things is to try

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Speaker 1: to improve the skill set and make sure you've got

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Speaker 1: the right skill match between what the economy is going

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Speaker 1: to be rewarding and needing and what what people have. Uh.

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Speaker 1: I think doing some reforms at the at the grammar

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Speaker 1: school and high school level are crucial, and that is

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Speaker 1: getting a lot more technical education in there quickly, right,

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Speaker 1: I need a word twenty seconds. Richard Claire, the vice

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Speaker 1: chairman of the FED. I think it's a great and

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Speaker 1: beautiful thing because he's really got humility about the certitude

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Speaker 1: of the models. So rich is an old friend I've

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Speaker 1: worked with him, um when I was a graduate student

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Speaker 1: at the Counts of Economic Advisors and he was a

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Speaker 1: senior economist known for a very long time. I think

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Speaker 1: a sensible, balanced person. Very good Randall Crossing, thank you

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Speaker 1: so much. Uh here just before the job report, is

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Speaker 1: this cool? John? It's very cold, you know, it's like

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Speaker 1: upstairs just having a coffee. And we put him into

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Speaker 1: the studio and yeah, it's Pyros Friday. It's like in

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Speaker 1: London when Mervin King you just wanders in. I mean

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Speaker 1: that it's it's very when we put the mic on

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Speaker 1: them and sat him go. William Gross joining us from

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Speaker 1: Janice Henderson today, thrilled to have them with us for

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Speaker 1: this entire that half our build uh in the mix

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Speaker 1: of things we can talk about is the great gross

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Speaker 1: observation of years ago, a financial repression. Boy, is my

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Speaker 1: mailbox heated up with a lot of mail from older

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Speaker 1: individuals saying we just don't see it ending. When does

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Speaker 1: the real the the nominal rate lift and can it

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Speaker 1: lift without a lifted inflation that flattens or destroys savings,

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Speaker 1: real income or real return, which continues the financial repression forever. Well, good, good, good,

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Speaker 1: good question, Uh, you know, I think financial repression. If

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Speaker 1: I go back in history, that the big financial repressive

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Speaker 1: cycle was from the forties to I guess the vocal

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Speaker 1: era in nine when all of a sudden real rates

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Speaker 1: went positive as opposed to negative. But it took a

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Speaker 1: long time to get out of that period in which

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Speaker 1: really reflected a high level of debt and the willingness

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Speaker 1: to lower that debt by repressing savers, not just uh,

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Speaker 1: small savers, but repressing financial institutions like pension funds and

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Speaker 1: insurance companies and the like. So what's really happened here

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Speaker 1: tom over the past six or seven years has been

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Speaker 1: uh financial repression that somebody pays the price. The small

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Speaker 1: savers pays the price because they don't earn um what

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Speaker 1: they used to earn relative to inflation in this case

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Speaker 1: perhaps inflation or something less, and they can't maintain their

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Speaker 1: their goals going forward. They can't pay for education, they

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Speaker 1: can't pay for retirement, etcetera, etcetera. And it's the same

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Speaker 1: thing with pension funds and insurance companies. They can't make

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Speaker 1: their seven to eight percent target return on assets because

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Speaker 1: bobs are only returning to three and four. If you're

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Speaker 1: in the high yield category. So yeah, financial repression is

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Speaker 1: a key for financial for global recovery, for economics, than

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Speaker 1: every with certain Atlanta key for the saver. But the

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Speaker 1: distinction of this bill is when we went up to

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Speaker 1: Mr Volker and Frankly up to eighties six Reagan, we

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Speaker 1: did it with an incumbered debt. It was so smaller

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Speaker 1: than it is now we're doing financial We're doing financial

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Speaker 1: repression with fewer degrees of freedom within what we can

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Speaker 1: do about it? What's the gross prescription to get us

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Speaker 1: to a better real return on our savings. Well, that's

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Speaker 1: again such a perfect observation. Um, you know we have

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Speaker 1: we have a lot of debt. You know, we can

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Speaker 1: look at it from the standpoint of the government debt

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Speaker 1: to GDP and it's approaching. We can look at it

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Speaker 1: from the standpoint of corporations. We can look at it

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Speaker 1: from the standpoint of the total debt about two GDP.

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Speaker 1: It's much different than it was in the fourties and

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Speaker 1: the fifties, And so central banks, especially the FED, have

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Speaker 1: to be careful in terms of raising the rates. They

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Speaker 1: know what happened in two thousand and five and two

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Speaker 1: thousand and six, women went to five and a quarter,

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Speaker 1: a great recession happened, and so they're being very very cautious.

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Speaker 1: Um and in the process, as you suggest, you know,

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Speaker 1: financially repressing savers. So what's the what's the formula, what's

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Speaker 1: the secret? Well, you know, the easy one is to

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Speaker 1: say that the secret is higher productivity. How do you

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Speaker 1: get higher products You need to get with tax cuts,

430
00:24:36,960 --> 00:24:39,920
Speaker 1: I don't think so necessarily. You get it obviously though

431
00:24:40,040 --> 00:24:43,040
Speaker 1: with corporate investment. And that's what we need to see

432
00:24:43,200 --> 00:24:47,280
Speaker 1: in order to maintain real growth and offer savers a

433
00:24:47,480 --> 00:24:50,280
Speaker 1: higher real rate of return in the process. I mean,

434
00:24:50,400 --> 00:24:53,879
Speaker 1: I mean within this bill is the fiscal response that

435
00:24:53,960 --> 00:24:58,200
Speaker 1: we've seen. I'm sure you're appalled with it, like everyone

436
00:24:58,240 --> 00:25:01,560
Speaker 1: else I speak with. We've got the tariff debate of

437
00:25:01,640 --> 00:25:03,960
Speaker 1: the last number of days over like Korea, which I

438
00:25:04,000 --> 00:25:06,240
Speaker 1: don't think Bill Gross is going to give us a

439
00:25:06,280 --> 00:25:09,560
Speaker 1: strong opinion on. But the fact is, within the jumble

440
00:25:09,720 --> 00:25:17,680
Speaker 1: and cacophony, now that you see, how are you investing unconstrained? Well,

441
00:25:17,720 --> 00:25:21,200
Speaker 1: I'm I'm short bonds. Uh. You know, unconstrained means that

442
00:25:21,359 --> 00:25:23,560
Speaker 1: you don't have to follow an index, and actually the

443
00:25:23,640 --> 00:25:27,440
Speaker 1: index is three months live or index which is short, short, short,

444
00:25:27,560 --> 00:25:30,920
Speaker 1: but so my duration is about two or three years negative.

445
00:25:30,960 --> 00:25:33,840
Speaker 1: It's doing well at the moment as bonds so off,

446
00:25:34,400 --> 00:25:37,800
Speaker 1: and UM, you know, I think that's going to be

447
00:25:37,920 --> 00:25:41,639
Speaker 1: the case going forward. Um. You mentioned the fiscal situation.

448
00:25:42,600 --> 00:25:46,240
Speaker 1: A trillion dollar deficit is you know, perhaps five billion

449
00:25:46,280 --> 00:25:49,520
Speaker 1: dollars more in terms of net financing for the US

450
00:25:49,680 --> 00:25:52,720
Speaker 1: Treasury than we've seen over the past twelve or twenty

451
00:25:52,760 --> 00:25:56,080
Speaker 1: four months. And we know that quantitative easing is going

452
00:25:56,160 --> 00:25:59,120
Speaker 1: the other way as well, as the FED takes out

453
00:25:59,280 --> 00:26:02,359
Speaker 1: ten twenty thirty billion dollars a month. And so that,

454
00:26:02,520 --> 00:26:05,840
Speaker 1: in addition to the global situation with the ECB, which

455
00:26:05,920 --> 00:26:09,240
Speaker 1: is moving mildly in the same direction. Um, you know,

456
00:26:09,359 --> 00:26:11,880
Speaker 1: suggest that bonds are on the defensive. But I still

457
00:26:12,000 --> 00:26:15,200
Speaker 1: don't think that three, three and a half or four

458
00:26:15,280 --> 00:26:18,879
Speaker 1: percent is where we're going because the central banks, as

459
00:26:18,960 --> 00:26:22,800
Speaker 1: I've mentioned, are very very cautious in terms of recreating

460
00:26:22,960 --> 00:26:26,800
Speaker 1: a great recessionary environment. We've got the dual mandate, I

461
00:26:26,840 --> 00:26:29,160
Speaker 1: guess right in the cross here's this morning here, which

462
00:26:29,240 --> 00:26:33,000
Speaker 1: does Chairman Paul focus on? Does he focus on terrific

463
00:26:33,359 --> 00:26:37,159
Speaker 1: unit job growth? And frankly focus a lot of underlying

464
00:26:37,280 --> 00:26:41,200
Speaker 1: data confirming that including media and duration, coming in on

465
00:26:41,359 --> 00:26:45,199
Speaker 1: unemployment okay, fine? Or does he focus on a tepid

466
00:26:45,320 --> 00:26:49,919
Speaker 1: wage growth? He can't do both, Kenny, No, he can't.

467
00:26:50,280 --> 00:26:54,920
Speaker 1: In today's numbers suggest a conundrum for him in terms

468
00:26:54,960 --> 00:26:57,440
Speaker 1: of one or the other. When this number of first

469
00:26:57,440 --> 00:26:59,919
Speaker 1: came out five minutes ago, I wondered what them are

470
00:27:00,000 --> 00:27:03,680
Speaker 1: good would do? Would they react to strong employment numbers

471
00:27:03,840 --> 00:27:06,480
Speaker 1: or would they react to the lower wages. It was

472
00:27:06,520 --> 00:27:08,800
Speaker 1: a tug of war for about thirty seconds. And now

473
00:27:09,240 --> 00:27:11,080
Speaker 1: at the moment, at least, there appears to be a

474
00:27:11,119 --> 00:27:14,760
Speaker 1: sell off. So the market believes that Pal may focus

475
00:27:14,880 --> 00:27:18,639
Speaker 1: on the job's growth, and that means, if true, that

476
00:27:18,760 --> 00:27:21,560
Speaker 1: means three or four hikes as opposed to one, two

477
00:27:21,680 --> 00:27:25,560
Speaker 1: or three. I'm again, I'm still of the persuasion of

478
00:27:26,040 --> 00:27:29,400
Speaker 1: two or perhaps three hikes at best and UH ten

479
00:27:29,480 --> 00:27:32,680
Speaker 1: years well positioned. But we're at two eighty nine nine

480
00:27:32,800 --> 00:27:36,240
Speaker 1: at the moment. I I look and against folks with thrilled.

481
00:27:36,280 --> 00:27:38,280
Speaker 1: The Bill Gross is with us for an extended time

482
00:27:38,359 --> 00:27:41,240
Speaker 1: here today, thrilled to bring us to your commercial free

483
00:27:41,720 --> 00:27:44,399
Speaker 1: UH this morning, Uh Bill Gross, I look at the

484
00:27:44,520 --> 00:27:47,520
Speaker 1: challenges of investment, and I would say, pros are in

485
00:27:47,760 --> 00:27:50,159
Speaker 1: short they're in short maturities, and so many of our

486
00:27:50,240 --> 00:27:54,240
Speaker 1: listeners are just desperate for yield, so they take the

487
00:27:54,400 --> 00:27:57,840
Speaker 1: risk of going out longer maturity. What's the best way

488
00:27:57,920 --> 00:28:00,639
Speaker 1: to go out in maturity? Is it full faith and

489
00:28:00,720 --> 00:28:03,320
Speaker 1: credit paper or do you got to get more esoteric

490
00:28:03,680 --> 00:28:06,600
Speaker 1: with subcountry I can pronounce and go for a high

491
00:28:06,640 --> 00:28:13,240
Speaker 1: emerging market yield. Well, the quick answers to refuture. The

492
00:28:13,320 --> 00:28:16,000
Speaker 1: basis of your question is to not go longer in maturity.

493
00:28:16,040 --> 00:28:18,760
Speaker 1: But as some investors do, and pension funds do, don't

494
00:28:18,840 --> 00:28:21,600
Speaker 1: they in order to match their liabilities? And so what

495
00:28:21,680 --> 00:28:24,960
Speaker 1: would a what would a pension fund do? I would

496
00:28:25,200 --> 00:28:27,280
Speaker 1: say that the best way to go in terms of

497
00:28:27,320 --> 00:28:30,280
Speaker 1: longer maturity is the the U. S. Treasury the long

498
00:28:30,359 --> 00:28:34,359
Speaker 1: bond at three seventeen you know, compared to Germany, compared

499
00:28:34,400 --> 00:28:38,440
Speaker 1: to the UK, compared to certainly Japan UH and the

500
00:28:38,840 --> 00:28:43,040
Speaker 1: credit is full faith without the risk of widening spreads.

501
00:28:43,120 --> 00:28:46,640
Speaker 1: So pension fund and I guess a small saver if

502
00:28:46,680 --> 00:28:49,480
Speaker 1: they want to take the durational risk, I wouldn't. I'm

503
00:28:49,520 --> 00:28:52,360
Speaker 1: the other way would probably go to the U. S.

504
00:28:52,400 --> 00:28:55,800
Speaker 1: Treasury market at three seventeen one final question this morning,

505
00:28:55,840 --> 00:28:59,280
Speaker 1: Bill goes, please tell me you don't use those dumb stamps.

506
00:28:59,600 --> 00:29:04,840
Speaker 1: It's a any place, you know, whatever they say, forever, forever, forever,

507
00:29:04,960 --> 00:29:09,520
Speaker 1: since Bill Bill Gross with the US Postage Office, forever

508
00:29:09,720 --> 00:29:13,480
Speaker 1: stamp is Unamerican? Do you use those? Bill grows? I

509
00:29:13,560 --> 00:29:16,520
Speaker 1: wouldn't even know how to buy them up office down

510
00:29:16,560 --> 00:29:19,040
Speaker 1: the street, but I don't know. I just sort of

511
00:29:19,120 --> 00:29:21,480
Speaker 1: hand it over and then do it electronically. I don't

512
00:29:21,480 --> 00:29:23,680
Speaker 1: know the last time I used to stamp. Well, very good,

513
00:29:23,720 --> 00:29:26,880
Speaker 1: Bill Gross, congratulations on your charity of the nation for

514
00:29:27,000 --> 00:29:31,520
Speaker 1: good causes. And of course, uh, you know he's too modest, folks.

515
00:29:31,600 --> 00:29:35,080
Speaker 1: It is the definitive stamp collection in the world. Today.

516
00:29:35,120 --> 00:29:38,280
Speaker 1: William Gross is with Janice Henderson where sometimes we talk

517
00:29:38,360 --> 00:29:54,000
Speaker 1: about jobs in the Bondom market as well. One of

518
00:29:54,080 --> 00:29:59,920
Speaker 1: the great joys of Chicago is an exceptionally eclectic Harry

519
00:30:00,000 --> 00:30:04,600
Speaker 1: Age and faculty. This goes back to Frank Knight many

520
00:30:04,680 --> 00:30:08,120
Speaker 1: a century ago. Almost I can't believe I'm saying that,

521
00:30:08,680 --> 00:30:13,560
Speaker 1: or to Professor Freedman, or of course the wonderful Gary Becker.

522
00:30:14,080 --> 00:30:17,840
Speaker 1: And it is a statement on Chicago to have Randall

523
00:30:17,880 --> 00:30:22,080
Speaker 1: Krosner with us earlier and now joining us somebody totally

524
00:30:22,280 --> 00:30:25,880
Speaker 1: different than the former governor of the FED. Austin Gulsby

525
00:30:26,520 --> 00:30:29,160
Speaker 1: joins us from the BOSCO Chicago and of Courses public

526
00:30:29,240 --> 00:30:34,200
Speaker 1: Service with President Obama at the Fed. Professor Guelsby, wonderful

527
00:30:34,240 --> 00:30:36,719
Speaker 1: to have you with us today. If you were over

528
00:30:37,120 --> 00:30:40,160
Speaker 1: a coffee of your choice at Milton Academy and an

529
00:30:40,240 --> 00:30:44,600
Speaker 1: eager student stood up and said, Mr Guelsby, alumni, what's

530
00:30:44,600 --> 00:30:47,640
Speaker 1: the difference between you and Randall Krossner? How would you

531
00:30:47,640 --> 00:30:54,000
Speaker 1: answer that question? Well, I am sure, Well we know that.

532
00:30:54,200 --> 00:30:57,120
Speaker 1: But other than that, what's the difference between the financial

533
00:30:57,240 --> 00:31:01,880
Speaker 1: economics of Krosner and a much more holistic approach of

534
00:31:01,960 --> 00:31:06,840
Speaker 1: a guy like Ghoulsby? Well, Um, Randy is a good

535
00:31:06,880 --> 00:31:09,520
Speaker 1: friend of mine, is off this right down the hall.

536
00:31:10,240 --> 00:31:13,560
Speaker 1: He's a he's a Republican. I'd say we agree on

537
00:31:13,640 --> 00:31:17,160
Speaker 1: a lot of things. Uh. You know, most economists on

538
00:31:17,280 --> 00:31:20,920
Speaker 1: both sides of the aisle have mostly agreement on on

539
00:31:21,760 --> 00:31:26,960
Speaker 1: on economic things. We probably disagree most on fiscal policy,

540
00:31:27,240 --> 00:31:31,400
Speaker 1: taxes and and some stuff like that. But a lot

541
00:31:31,480 --> 00:31:35,640
Speaker 1: of times we we find when we do he and

542
00:31:35,760 --> 00:31:39,200
Speaker 1: I do some economic outlook kind of events together with

543
00:31:39,400 --> 00:31:43,000
Speaker 1: the Booth School and on monetary policy. A lot of

544
00:31:43,080 --> 00:31:45,920
Speaker 1: times we we uh, we find we agree he has

545
00:31:45,920 --> 00:31:49,280
Speaker 1: a little more international finance focus than I do. Let's

546
00:31:49,360 --> 00:31:52,600
Speaker 1: vamp off that to the idea of tax cuts and

547
00:31:52,720 --> 00:31:56,880
Speaker 1: to fiscal stimulus. I'm beginning to see new numbers verbal

548
00:31:57,120 --> 00:31:59,959
Speaker 1: of one point four one point five trillion as well.

549
00:32:00,760 --> 00:32:03,280
Speaker 1: Is the good jobs report today in the three months

550
00:32:03,360 --> 00:32:09,040
Speaker 1: moving average? Is that an expectation of fiscal stimulus? Or

551
00:32:09,120 --> 00:32:10,840
Speaker 1: do we got to get used to four hundred and

552
00:32:10,920 --> 00:32:14,880
Speaker 1: five hundred thousand dollars five thousand unit non farm payrolls

553
00:32:15,240 --> 00:32:18,880
Speaker 1: when all of this stuff clicks in? Look at the

554
00:32:18,960 --> 00:32:21,720
Speaker 1: good question. This was an excellent number, and we should

555
00:32:21,760 --> 00:32:25,880
Speaker 1: be uh, we should all be quite happy. I think

556
00:32:26,040 --> 00:32:30,400
Speaker 1: it's also interesting that the wage growth is there, but

557
00:32:30,560 --> 00:32:34,120
Speaker 1: it's come down a bit from what it was last month,

558
00:32:34,200 --> 00:32:37,560
Speaker 1: so maybe people won't be as nervous that there's the

559
00:32:37,720 --> 00:32:42,160
Speaker 1: imminent danger of immediate inflation. Let's say, UM, I had

560
00:32:42,480 --> 00:32:47,200
Speaker 1: personally don't think that the jobs numbers are going to

561
00:32:47,320 --> 00:32:51,160
Speaker 1: get up into this four and five kind of range,

562
00:32:51,320 --> 00:32:56,960
Speaker 1: because I don't think that the economic stimulus of the

563
00:32:57,320 --> 00:33:02,080
Speaker 1: tax cut is as big as uh. Maybe the optimists

564
00:33:02,200 --> 00:33:07,120
Speaker 1: think the on the corporate side, whether that would lead

565
00:33:07,240 --> 00:33:12,280
Speaker 1: to a significant stimulus hinges critically on this question of well,

566
00:33:12,360 --> 00:33:14,920
Speaker 1: what are company is going to do with the money,

567
00:33:15,560 --> 00:33:19,480
Speaker 1: And if they don't primarily use the money for capital

568
00:33:19,600 --> 00:33:23,400
Speaker 1: investment in instead more of the money goes out and

569
00:33:23,480 --> 00:33:26,760
Speaker 1: div it INDs or share by backs or merging and acquisitions,

570
00:33:27,560 --> 00:33:30,920
Speaker 1: then I think the stimulus impact will be lessened. And

571
00:33:31,040 --> 00:33:34,960
Speaker 1: I think the tax cuts for high income people, historically

572
00:33:35,720 --> 00:33:38,840
Speaker 1: most of that money gets saved, is not as stimulative.

573
00:33:38,920 --> 00:33:42,240
Speaker 1: So I'm not as nervous for people who think, Hey,

574
00:33:42,320 --> 00:33:45,760
Speaker 1: the Feds already in a rate rising environment and now

575
00:33:45,800 --> 00:33:48,160
Speaker 1: we're going to add a huge stimulus on top of it,

576
00:33:48,480 --> 00:33:52,200
Speaker 1: so rates are about to fly off the handle. Um,

577
00:33:52,480 --> 00:33:55,080
Speaker 1: I think less. I don't think that's as big of

578
00:33:55,120 --> 00:33:58,440
Speaker 1: a risk. Austin Coulsby, back in December, you said that

579
00:33:58,600 --> 00:34:03,040
Speaker 1: stagnant wages are one factor that could prevent the Federal

580
00:34:03,080 --> 00:34:08,160
Speaker 1: Reserve from continuing to raise interest rates in nineteen. Do

581
00:34:08,320 --> 00:34:11,279
Speaker 1: you still concur with that based on the two point

582
00:34:11,360 --> 00:34:17,880
Speaker 1: six number that we received today, Well, the just unpacked slightly.

583
00:34:18,080 --> 00:34:21,640
Speaker 1: It's not just the wages alone. It's my view has

584
00:34:21,719 --> 00:34:26,000
Speaker 1: been the economy is growing solidly but it's not growing

585
00:34:26,280 --> 00:34:31,279
Speaker 1: as fast as what the most optimistic folks at the

586
00:34:31,440 --> 00:34:38,360
Speaker 1: FED think, so that we will continue to find they're

587
00:34:38,360 --> 00:34:41,279
Speaker 1: more than glimmers of hope will be growing, and they'll say, look,

588
00:34:41,320 --> 00:34:43,959
Speaker 1: the jobs numbers are great, the wages are really high.

589
00:34:44,480 --> 00:34:46,719
Speaker 1: But then over the course of the next two or

590
00:34:46,800 --> 00:34:50,680
Speaker 1: three months, we'll get in dated that revises that down,

591
00:34:51,080 --> 00:34:54,160
Speaker 1: and then they'll say, well, maybe it's not as strong,

592
00:34:54,400 --> 00:34:57,080
Speaker 1: so let's let's continue to wait for a few months.

593
00:34:57,920 --> 00:35:01,359
Speaker 1: I might be wrong on that, but for sure, as

594
00:35:01,440 --> 00:35:05,359
Speaker 1: I've mentioned, if you look at the wages, that very

595
00:35:05,480 --> 00:35:09,000
Speaker 1: high number last time toned down a bit this time,

596
00:35:09,120 --> 00:35:10,799
Speaker 1: and we'll have to see what it is next time.

597
00:35:10,880 --> 00:35:13,800
Speaker 1: As I always say, if it doesn't go for three months,

598
00:35:13,880 --> 00:35:17,960
Speaker 1: it's not a thing yet. Does Does President Trump deserves

599
00:35:18,040 --> 00:35:22,240
Speaker 1: some credit for today's jobs report? Yeah, he probably deserves

600
00:35:22,840 --> 00:35:26,160
Speaker 1: some credit. Now. I think I have credibility because I

601
00:35:26,320 --> 00:35:29,400
Speaker 1: used to say it when I was in the job

602
00:35:30,040 --> 00:35:33,960
Speaker 1: in the administration, and they job's numbers started to improve.

603
00:35:34,680 --> 00:35:37,480
Speaker 1: Ninety plus percent of what happens in the economy has

604
00:35:37,560 --> 00:35:43,080
Speaker 1: nothing to do with Washington, and the private sector generates

605
00:35:43,440 --> 00:35:46,759
Speaker 1: its own dynamic, and that's mostly what you want to

606
00:35:46,800 --> 00:35:52,120
Speaker 1: look for. But uh, but for sure the administration has

607
00:35:52,560 --> 00:35:56,680
Speaker 1: They have definitely not done anything to disrupt the does

608
00:35:56,840 --> 00:36:00,080
Speaker 1: what's now the second longest boom in US history, and

609
00:36:00,160 --> 00:36:02,920
Speaker 1: they've they've taken some actions that do seem to have

610
00:36:03,120 --> 00:36:07,640
Speaker 1: increased confidence on the on the business side, I want

611
00:36:07,680 --> 00:36:10,440
Speaker 1: to get your thoughts on banking regulation and Dodd Frank

612
00:36:10,640 --> 00:36:14,160
Speaker 1: and changes to that legislation based on what you know

613
00:36:14,280 --> 00:36:16,560
Speaker 1: about what the administration would like to see what your

614
00:36:16,600 --> 00:36:21,239
Speaker 1: thoughts well, as you might guess, I've always been a

615
00:36:21,360 --> 00:36:26,799
Speaker 1: skeptic of the of the argument that what the economy

616
00:36:26,880 --> 00:36:29,040
Speaker 1: needs now is to go rip up the rules of

617
00:36:29,120 --> 00:36:33,480
Speaker 1: the road that we established after the crisis. I am

618
00:36:33,640 --> 00:36:38,719
Speaker 1: sympathetic to the view that small community banks, um, we're

619
00:36:38,840 --> 00:36:43,680
Speaker 1: never intended to get wrapped into the regulatory web that

620
00:36:44,080 --> 00:36:48,479
Speaker 1: we apply to the larger financial institutions, So that part

621
00:36:48,600 --> 00:36:53,279
Speaker 1: of the deregulation I basically agree with. I don't have

622
00:36:53,360 --> 00:36:58,440
Speaker 1: a problem with. There are many aspects of these of

623
00:36:58,600 --> 00:37:00,919
Speaker 1: these moves that make me nervous, you know where they're

624
00:37:01,560 --> 00:37:04,759
Speaker 1: where they're basically saying, let's just keep inching up the

625
00:37:04,880 --> 00:37:10,240
Speaker 1: thresholds of when you get additional scrutiny higher and higher,

626
00:37:10,280 --> 00:37:12,920
Speaker 1: so you can be a bigger and bigger financial institution.

627
00:37:13,600 --> 00:37:16,920
Speaker 1: And like I said, I guess my objection is to

628
00:37:17,120 --> 00:37:22,560
Speaker 1: the philosophy that what we need is more deregulation on

629
00:37:22,680 --> 00:37:25,800
Speaker 1: the financial side. We know what happens when you start

630
00:37:26,360 --> 00:37:31,720
Speaker 1: having asset bubbles are big asset price moves plus lots

631
00:37:31,760 --> 00:37:36,120
Speaker 1: of leverage plus less oversight, and it's not a good nomination.

632
00:37:36,320 --> 00:37:41,239
Speaker 1: Austin one final question, you enjoyed BOOST school packed attendants.

633
00:37:41,320 --> 00:37:45,880
Speaker 1: It's like cubs, it's like clubs, cardinals in July for

634
00:37:45,960 --> 00:37:52,240
Speaker 1: a class on platform industries where you get buyers, sellers,

635
00:37:52,320 --> 00:37:56,560
Speaker 1: and third party providers together, that glorious service sector, that

636
00:37:56,719 --> 00:38:00,840
Speaker 1: modern digital service sector. Are they affected by steel and

637
00:38:01,000 --> 00:38:07,319
Speaker 1: aluminium tariffs? Aluminium there there, there, we have it. Um,

638
00:38:08,080 --> 00:38:13,720
Speaker 1: they're not not most they're not big users of steel

639
00:38:14,120 --> 00:38:17,799
Speaker 1: for the internet companies and that sort of thing. Uh,

640
00:38:18,120 --> 00:38:20,840
Speaker 1: the there's about six and a half million jobs and

641
00:38:20,960 --> 00:38:24,279
Speaker 1: steel using industries. You know, there's a little over a

642
00:38:24,400 --> 00:38:28,960
Speaker 1: hundred thousand jobs in the steel making industries. So that's

643
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Speaker 1: why I and the economists on both sides view raising

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Speaker 1: the price of that input is not a good idea,

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Speaker 1: even if you're trying to do is say manufacturing jobs.

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Speaker 1: You actually reckon more of them than you're than you're saving.

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Speaker 1: You gotta leave it their Austin goals. We thank you

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Speaker 1: so much. I kild folks. I mean his classes are

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Speaker 1: packed at most school Chicago. Professor gouls Be the former

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Speaker 1: Chairman President's Council of Economic Adviser for President Obama as well. Yeah,

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Speaker 1: thanks for listening to the Bloomberg Surveillance podcast. Subscribe and

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Speaker 1: listen to interviews on Apple Podcasts, SoundCloud, or whichever podcast

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Speaker 1: platform you prefer. I'm on Twitter at Tom Keene before

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Speaker 1: the podcast. You can always catch us worldwide. I'm Bloomberg

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Speaker 1: Radio