WEBVTT - Bloomberg Surveillance TV: April 20th, 2026 0:00:00.040 --> 0:00:06.720 Bloomberg Audio Studios, Podcasts, radio News. 0:00:11.640 --> 0:00:15.440 This is the Bloomberg Surveillance Podcast. I'm Jonathan Ferrow, along 0:00:15.480 --> 0:00:18.680 with Lisa Bromwitz and Amrie Hordern. Join us each day 0:00:18.720 --> 0:00:22.280 for insight from the best in markets, economics, and geopolitics 0:00:22.400 --> 0:00:24.880 from our global headquarters in New York City. We are 0:00:24.920 --> 0:00:27.680 live on Bloomberg Television weekday mornings from six to nine 0:00:27.720 --> 0:00:31.280 am Eastern. Subscribe to the podcast on Apple, Spotify or 0:00:31.320 --> 0:00:33.919 anywhere else you listen, and as always on the Bloomberg 0:00:34.000 --> 0:00:37.280 Terminal and the Bloomberg Business app our front and center. 0:00:37.320 --> 0:00:39.400 Is this one? This story at the moment crude climbing 0:00:39.520 --> 0:00:41.880 on renewed uncertainty through the stred of for mers Am 0:00:41.920 --> 0:00:44.280 world of the Atlantic Council writing, instead of trying to 0:00:44.400 --> 0:00:47.519 jawbone markets with positive sentiment, the president should stick with 0:00:47.600 --> 0:00:50.839 messaging from a position of strength and no vacillation. And 0:00:50.920 --> 0:00:53.600 then joined us now for more Adan, Welcome to the program. 0:00:53.840 --> 0:00:56.720 I was speaking to a market contact earlier who had 0:00:56.760 --> 0:00:59.640 a basic question, is the worst of it behind us? 0:00:59.760 --> 0:01:03.080 Is this the post Liberation day picture of the market 0:01:03.200 --> 0:01:05.480 right now? Is it a similar story or is it 0:01:05.560 --> 0:01:06.720 different this time? 0:01:07.800 --> 0:01:11.680 I'm not sure whether we're really whether the worst is passed. 0:01:11.680 --> 0:01:16.119 So I think that the US actually commandeering or blockading 0:01:16.160 --> 0:01:21.120 these ships is pretty much an escalation of events. It 0:01:21.240 --> 0:01:25.399 depends I guess, whether we see more active bombing and 0:01:25.480 --> 0:01:30.600 whether we see Iran responding to that by hitting its neighbors. 0:01:30.640 --> 0:01:34.000 I think that that's absolutely still in the cards, though 0:01:34.040 --> 0:01:38.360 the fact that the ceasefire is I guess technically still 0:01:38.400 --> 0:01:40.319 in place, though I'm not sure you can say it's 0:01:40.319 --> 0:01:40.960 still in place. 0:01:41.000 --> 0:01:41.800 If we've had. 0:01:41.720 --> 0:01:45.840 Iranian ships firing on ships trying to transit the Straight 0:01:45.920 --> 0:01:48.960 and the US firing on Iranian ships, I'm not sure 0:01:48.960 --> 0:01:51.960 we can really call that a ceasefire. But it does 0:01:52.000 --> 0:01:55.640 seem to still be in place, and so I wouldn't 0:01:55.680 --> 0:01:58.800 be too hesitant to say that the worst is passed, 0:01:58.840 --> 0:02:01.400 but it's could get worse very very quickly. 0:02:01.560 --> 0:02:03.160 Let me ask you what you think was more likely 0:02:03.240 --> 0:02:05.800 that in the next twenty four forty eight hours an 0:02:05.800 --> 0:02:09.079 extension of the ceasefire or a resumption of hostilities. 0:02:10.080 --> 0:02:13.640 I think an extension of the ceasefire is more likely, 0:02:14.160 --> 0:02:17.639 but only maybe a little over fifty percent, I would 0:02:17.639 --> 0:02:18.200 put it at. 0:02:18.880 --> 0:02:21.960 So at this point, Ellen, how feasible do you see 0:02:22.000 --> 0:02:25.080 the outcome that the market is pricing in. This is 0:02:25.080 --> 0:02:26.440 sort of what we're trying to get our head around, 0:02:26.480 --> 0:02:29.240 because it seems like people come on the show who 0:02:29.280 --> 0:02:31.440 are in the equity space or who even trade oil, 0:02:31.480 --> 0:02:34.840 and they say, well, you know, this actually roughly games 0:02:34.840 --> 0:02:37.560 out what's probable, and an oil commodity strategist come on 0:02:37.639 --> 0:02:40.600 and they say, absolutely not, that seems highly unlikely. 0:02:40.760 --> 0:02:41.440 What's your take. 0:02:42.760 --> 0:02:45.160 I think it's it's pretty unlikely right now. I think 0:02:45.160 --> 0:02:49.880 the market is over exuberant in terms of. 0:02:49.560 --> 0:02:51.240 A fast fix to all of this. 0:02:51.400 --> 0:02:55.280 I think that despite what President trum tweeted on Friday, 0:02:56.000 --> 0:02:58.920 Iran and the United States are leagues and leagues and 0:02:59.000 --> 0:03:01.520 worlds apart in terms terms of what they want, and 0:03:01.560 --> 0:03:06.040 Iran has absolutely no incentive to give in on anything 0:03:06.040 --> 0:03:09.679 at this point, because, first of all, it doesn't see 0:03:09.680 --> 0:03:13.160 anything wrong with higher oil prices, whereas Trump keeps going 0:03:13.200 --> 0:03:15.680 back to these very positive statements to try to get 0:03:15.720 --> 0:03:18.480 prices down and get the Dow drones up. And yet 0:03:19.160 --> 0:03:21.120 I think it's pretty clear at this point that once 0:03:21.160 --> 0:03:24.160 everything actually is resolved, we're going to go back to 0:03:24.240 --> 0:03:24.799 where we. 0:03:24.639 --> 0:03:25.520 Were in a hurry. 0:03:25.560 --> 0:03:28.320 Prices will go to oil prices will go down, equities 0:03:28.320 --> 0:03:31.040 will go up, and so it seems like it's kind 0:03:31.040 --> 0:03:33.560 of confusing to me. So why he keeps trying to 0:03:34.000 --> 0:03:37.840 make things seem better than they are, just to get 0:03:37.840 --> 0:03:40.200 things looking better at the beginning of the week or 0:03:40.240 --> 0:03:43.760 when market's open, when you know, let it be, you know, 0:03:44.000 --> 0:03:46.880 say say your position holds strong, because that's clearly what 0:03:46.960 --> 0:03:50.800 he wants to do, and then let it all, you know, 0:03:50.880 --> 0:03:53.320 but let the cards fall where they will when it ends. 0:03:53.520 --> 0:03:56.560 Ellen, you wrote the book on Saudi Arabia Saudi Inc. 0:03:56.960 --> 0:04:01.280 Talking about how the kingdom really came to fruition and 0:04:01.320 --> 0:04:04.480 some of the monetary backing of the oil complex. Do 0:04:04.520 --> 0:04:07.360 you have a sense of how much Saudi Arabia and 0:04:07.400 --> 0:04:11.920 the other Golf countries are shifting alliances moving away from 0:04:11.960 --> 0:04:14.120 the US maybe amid this conflict. 0:04:15.320 --> 0:04:17.560 I do think that we're in a different paradigm than 0:04:17.600 --> 0:04:20.160 we used to be. Really, you know, Asia is the 0:04:20.200 --> 0:04:24.320 most important customer now for Saudi Arabia and the UAE 0:04:24.839 --> 0:04:27.640 and other big oil exporters. It used to be that 0:04:27.680 --> 0:04:31.719 the US was their most important customer. However, China and 0:04:31.800 --> 0:04:35.560 Asian countries are not big military suppliers. China's Navy is 0:04:35.600 --> 0:04:37.960 never going to go into the Persian Gulf, whereas the 0:04:38.080 --> 0:04:39.719 US Navy, they're the ones. 0:04:39.560 --> 0:04:40.000 That are there. 0:04:40.080 --> 0:04:42.679 So it's a slightly different dynamic in that the US 0:04:42.800 --> 0:04:46.040 is still very important financially, very important as a military 0:04:46.080 --> 0:04:49.960 supplier and as a naval force and an air force 0:04:50.080 --> 0:04:53.159 in the region, but it's not that it doesn't play 0:04:53.240 --> 0:04:57.320 that same role as buyer of oil. And so that 0:04:57.400 --> 0:05:01.000 means that these countries have a bit less leverage over 0:05:01.040 --> 0:05:02.200 the US than they used to. 0:05:02.680 --> 0:05:04.599 But at the same time, they're not going to want 0:05:04.640 --> 0:05:07.560 to create all this friction with their security blanket, are 0:05:07.560 --> 0:05:09.120 they exactly? 0:05:09.240 --> 0:05:12.520 And so it is a bit of a careful line 0:05:12.520 --> 0:05:16.839 that they're walking because they need the military protection, but 0:05:16.920 --> 0:05:19.760 they can't necessarily say to the US, hey, we're we're 0:05:19.800 --> 0:05:22.719 going to you know, we're going to control oil supplies now, 0:05:23.080 --> 0:05:25.159 and to make sure we get that. It's it's not 0:05:25.240 --> 0:05:28.479 so much of a quid pro qo here, And I 0:05:28.480 --> 0:05:30.920 think that they do need to tread carefully, and we're 0:05:30.960 --> 0:05:33.920 seeing them tread carefully. You know, they haven't been all 0:05:33.960 --> 0:05:37.920 that vocal about about what's going on, and I think 0:05:38.000 --> 0:05:40.800 that that that's a sign that they know that their 0:05:40.839 --> 0:05:44.400 position is perhaps a little more precarious than it used 0:05:44.400 --> 0:05:44.600 to be. 0:05:44.720 --> 0:05:46.440 Well, there are of courts of mahome Ben Salmon had 0:05:46.440 --> 0:05:50.200 a phone call with Shijingping earlier. Today. Are the Golf 0:05:50.480 --> 0:05:53.440 arab partners you think pressing on China to put the 0:05:53.440 --> 0:05:54.760 thumb on the scale on Iran? 0:05:55.880 --> 0:05:59.920 I think they absolutely could, because China is one partner 0:06:00.120 --> 0:06:03.760 of Iran. They that has that economic pull with Iran. 0:06:04.080 --> 0:06:06.400 On the other hand, I do think that you know, 0:06:06.440 --> 0:06:09.440 these calls could be all about just maintaining, you know, 0:06:09.880 --> 0:06:13.040 maintaining the conversation about the fact that you know, China 0:06:13.080 --> 0:06:15.120 has a lot of investments in Saudi Arabia that are 0:06:15.120 --> 0:06:18.040 not doing all that well right now because they can't 0:06:18.040 --> 0:06:21.440 get oil out and you know, there are issues with 0:06:21.480 --> 0:06:24.880 the petrochemicals, and so I wouldn't be surprised to see 0:06:25.120 --> 0:06:28.039 the Saudis and counterparts in the UA reaching out to 0:06:28.760 --> 0:06:31.240 people in China to assure them that the relationship is 0:06:31.279 --> 0:06:33.520 strong that once this is over, you know, things are 0:06:33.520 --> 0:06:36.919 going to be repaired and go back to everyone making 0:06:36.960 --> 0:06:38.040 money the way it used to be. 0:06:38.160 --> 0:06:40.919 And what happened on Friday, can we just finish on that. 0:06:41.080 --> 0:06:45.040 Between eight and nine am Eastern time, On Friday, there 0:06:45.080 --> 0:06:48.960 was a series of messages from one delegate coming out 0:06:49.000 --> 0:06:51.240 of Iran and another in the US making the case 0:06:51.240 --> 0:06:54.920 of the stratiform merc that reopened and we were sitting 0:06:54.960 --> 0:06:57.440 care thinking maybe it has let's say, let's wait and 0:06:57.480 --> 0:06:59.600 find out. And then we found out pretty quickly it 0:06:59.640 --> 0:07:02.960 has an And so what happened that? Was it something 0:07:03.000 --> 0:07:05.520 the US diad or was it just that the Iranians 0:07:05.520 --> 0:07:08.840 committed to something that ultimately not all Iranians and all 0:07:08.839 --> 0:07:10.440 interested parties had a great suit. 0:07:11.360 --> 0:07:12.800 Yeah, I think it's I think it's both. 0:07:12.960 --> 0:07:14.840 It's it's a bit of both here, because there's a 0:07:14.840 --> 0:07:17.120 bit of over exuberance on the part of Trump to 0:07:17.200 --> 0:07:20.160 say the street reforms is open, Iran has agreed to 0:07:20.200 --> 0:07:21.680 everything we want, you know. 0:07:21.920 --> 0:07:23.120 Let's let's move on now. 0:07:23.160 --> 0:07:26.600 I think there's a huge amount of pressure, particularly from Trump, 0:07:26.840 --> 0:07:30.040 to for that to be the message on Iran's part. 0:07:30.120 --> 0:07:32.200 On the other hand, remember these are these are not 0:07:32.280 --> 0:07:34.720 These parties are not talking to each other. They're talking 0:07:34.800 --> 0:07:37.720 to intermediaries who are then talking to each other, who 0:07:37.760 --> 0:07:40.640 are then going and talking to the other parties. So 0:07:40.640 --> 0:07:43.200 so Iran and the US are not communicating with each other, 0:07:43.520 --> 0:07:45.720 and so there's a bit of a dance in the 0:07:45.720 --> 0:07:48.320 wordplay that comes over comes around the US may say 0:07:48.440 --> 0:07:50.800 we want X, Y and Z, and with that message 0:07:50.840 --> 0:07:54.440 gets to the Iranians. It's not the same as exactly 0:07:54.440 --> 0:07:57.120 what the US said. And so when Iran agrees to 0:07:57.240 --> 0:07:59.640 something they're agreeing to, what would they think they're agreeing 0:07:59.640 --> 0:08:03.080 to could fly with their people, which is not necessarily 0:08:03.400 --> 0:08:06.880 what Trump thinks they're agreeing to. And this happens a 0:08:06.920 --> 0:08:10.320 lot in diplomacy, particularly when the parties are not actually 0:08:10.400 --> 0:08:12.960 sitting down at the same table as each other and 0:08:13.000 --> 0:08:15.600 not speaking the same languages. And so I think this 0:08:15.680 --> 0:08:18.720 means there's a lot more to bridge. Iran also needs 0:08:18.760 --> 0:08:22.360 to message to its own people, and as you mentioned 0:08:22.400 --> 0:08:25.600 on the program earlier, we're not entirely sure exactly who 0:08:25.600 --> 0:08:28.520 we're speaking to with regards to Iran. There's the IRGC 0:08:29.040 --> 0:08:32.560 and there's the elected government, and those are not necessarily 0:08:32.600 --> 0:08:34.760 the same and don't have the same opinion and don't 0:08:34.760 --> 0:08:38.160 even necessarily have the same elements under their control in 0:08:38.240 --> 0:08:38.840 the country. 0:08:39.360 --> 0:08:42.800 Stay with us more Bloomberg surveillance coming up after this. 0:08:52.200 --> 0:08:55.240 President Donald Trump threatenings a quote knock out every single 0:08:55.280 --> 0:08:58.720 power plant and every single bridge in Iran if adal 0:08:58.920 --> 0:08:59.600 is not reached. 0:09:00.080 --> 0:09:00.520 Wallways. 0:09:00.520 --> 0:09:04.760 On global infrastructure, Sodak Wabba of Ice Squad Capital is 0:09:04.840 --> 0:09:08.800 remaining positive on the sector, writing the fundamental need for 0:09:08.880 --> 0:09:11.440 infrastructure in this part of the world doesn't disappear because 0:09:11.480 --> 0:09:15.440 the environment is difficult. If anything, it intensifies. Sodak joins 0:09:15.480 --> 0:09:17.040 us now for more. Good morning, sir, it's good to 0:09:17.040 --> 0:09:19.200 see you. Thank you, thank you very much for being 0:09:19.200 --> 0:09:21.680 care so in your opinion, in your mind, the war 0:09:21.720 --> 0:09:25.080 of the last two months or so doesn't upend infrastructure, 0:09:25.320 --> 0:09:26.600 it might accelerate it. 0:09:27.360 --> 0:09:31.280 Unfortunately in that sense. Yes, So two things. First, you're 0:09:31.320 --> 0:09:35.600 going to get at least sixty billion dollars probably more 0:09:35.960 --> 0:09:39.800 in terms of direct infrastructure damage. The problem is that's 0:09:39.840 --> 0:09:44.240 the physical damage, but you have consequences in addition to that, 0:09:44.440 --> 0:09:46.880 meaning it will take you a couple of years to 0:09:46.960 --> 0:09:50.560 rebuild some of that infrastructure. You'll have to spend on defense. 0:09:50.800 --> 0:09:53.920 So overall, the governments of the GCC have probably another 0:09:54.040 --> 0:09:56.400 hundred billion dollars that they need to spend over the 0:09:56.440 --> 0:09:59.560 coming years. What that will do, in my view, is 0:09:59.600 --> 0:10:03.160 it will push these governments into investing in these projects 0:10:03.520 --> 0:10:07.760 through direct government intervention and national oil companies, but then 0:10:08.000 --> 0:10:12.560 let the private sector focus on the remaining infrastructure over 0:10:12.600 --> 0:10:15.520 the course of the coming decade. If you look at 0:10:15.559 --> 0:10:19.640 the share, for example, in Saudi of non government oil, 0:10:20.240 --> 0:10:22.760 that's about forty percent. What's that number in the US 0:10:22.880 --> 0:10:26.920 about fifteen percent. So that share of government expenditure needs 0:10:27.000 --> 0:10:29.560 to come down any way over the coming years, and 0:10:29.640 --> 0:10:32.360 that I think will be accelerated because of what has happened. 0:10:32.400 --> 0:10:34.600 What do you think the key priorities will be now? 0:10:35.640 --> 0:10:39.440 I think there are two key priorities. One is redundancies 0:10:39.800 --> 0:10:43.840 and the other one is accelerated growth. So redundancies because 0:10:43.880 --> 0:10:48.120 we've seen that there's too much concentration in particular areas. 0:10:48.440 --> 0:10:51.360 So for example, twenty percent of the oil goes through 0:10:51.400 --> 0:10:55.000 the Strait of Homos. Twenty percent of the energy goes 0:10:55.040 --> 0:10:58.040 through the Strait of Homos. So what the GCC countries 0:10:58.080 --> 0:11:00.920 will need to do is to create redundancies, more pipelines, 0:11:01.160 --> 0:11:04.960 more storage facilities. And you're talking, by the way, they're 0:11:05.000 --> 0:11:08.120 already talking about that, right, it's not something that is speculative. 0:11:08.480 --> 0:11:10.920 What kind of pipeline do we need to build to 0:11:11.080 --> 0:11:14.440 remove that reliance on the Strait of homost one kind 0:11:14.480 --> 0:11:17.160 of storage facilities do we need to put in. So 0:11:17.200 --> 0:11:20.240 you're going to get a huge boost and investment in 0:11:20.320 --> 0:11:23.640 that kind of infrastructure to reduce that reliance. So that's 0:11:23.679 --> 0:11:27.200 one aspect. The second aspect of it is if you 0:11:27.280 --> 0:11:30.720 look at the non energy infrastructure, a lot of it 0:11:30.720 --> 0:11:34.480 has been concentrated in particular geographic areas. So for example, 0:11:34.760 --> 0:11:38.400 take data centers. One of the highest penetrations by the 0:11:38.440 --> 0:11:43.000 way of mobile phones, fantastic, but the digital infrastructure is 0:11:43.080 --> 0:11:46.040 highly concentrated in a few hubs, so a few hubs. 0:11:46.880 --> 0:11:52.599 Global cloud dependency, a fiber optic comes in particular geographic 0:11:52.640 --> 0:11:55.880 areas which we don't need to mention, so all concentrated 0:11:55.920 --> 0:11:57.960 in those areas, So that will have to change over 0:11:58.000 --> 0:12:00.680 the coming years. So one is data center. Another one 0:12:01.000 --> 0:12:04.920 is water resources. Sixty seven of the population in the 0:12:04.960 --> 0:12:10.840 GCC relies exclusively on diesel water and all the diesel 0:12:10.920 --> 0:12:14.240 plants are along that coast which is in the Gulf 0:12:14.240 --> 0:12:17.120 of Pressure, so you'll need to create a new infrastructure 0:12:17.160 --> 0:12:19.800 for water. Water reserves that need to be put in. 0:12:19.960 --> 0:12:21.960 This is a lot of money, and it's even more 0:12:21.800 --> 0:12:24.600 money when you think about how much the commodity prices 0:12:24.600 --> 0:12:27.080 are increasing as a result of all of this infrastructure 0:12:27.080 --> 0:12:29.640 build Where is the money going to come from. Is 0:12:29.640 --> 0:12:33.400 it going to be diverted from other initiatives that these 0:12:33.400 --> 0:12:35.920 Middle East countries are now investing in, whether it's golf 0:12:36.200 --> 0:12:40.040 or whether it's the premier league in football, or is 0:12:40.040 --> 0:12:41.760 it going to be coming from outside investors. 0:12:42.360 --> 0:12:46.559 I think it will come primarily from outside investors. So 0:12:46.720 --> 0:12:50.559 take a private equity firm like Iceweat Capital. We're looking 0:12:50.600 --> 0:12:53.160 to deploy easily over two billion dollars in the coming 0:12:53.240 --> 0:12:56.520 years in the region in that kind of infrastructure. It 0:12:56.559 --> 0:13:01.120 could be in water resources data centers, which already doing renewables. 0:13:01.559 --> 0:13:05.200 Renewables penetration in that area is five to seven percent, 0:13:06.000 --> 0:13:11.680 US is twenty world overall globally it's about thirty percent. 0:13:11.720 --> 0:13:14.840 Europe is sixty percent, So the weigh behind in terms 0:13:14.920 --> 0:13:18.959 of integrating renewables power into their system. So I think 0:13:19.000 --> 0:13:22.240 you're going to get a lot of investments. It should 0:13:22.240 --> 0:13:26.280 come primarily from foreign direct investments, private capital, and that's 0:13:26.320 --> 0:13:28.000 already happened in the last couple of years. 0:13:28.040 --> 0:13:30.480 Do you get the sense that there is an allegiance 0:13:30.600 --> 0:13:33.360 in terms of where the money comes from to go 0:13:33.480 --> 0:13:35.960 into some of these projects, the infrastructure projects. And I 0:13:35.960 --> 0:13:38.000 say this at a time where it seems like the 0:13:38.040 --> 0:13:40.680 world is kind of fracturing and there's a real question 0:13:40.760 --> 0:13:43.960 about US money going into the region or is it 0:13:44.000 --> 0:13:46.559 Asian money that's going into the region. At a time 0:13:46.600 --> 0:13:49.200 when this used to be sort of the new financial capital, 0:13:49.480 --> 0:13:51.120 that's kind of been called to a question. I mean, 0:13:51.240 --> 0:13:52.679 do you have a sense of where the flows are 0:13:52.720 --> 0:13:53.640 going to be coming from. 0:13:54.880 --> 0:13:58.160 I think, interestingly, the flows are going to continue to 0:13:58.200 --> 0:14:01.400 come from the US because we are the largest, deepest 0:14:01.520 --> 0:14:03.560 capital markets in the world. There's no doubt about that. 0:14:04.800 --> 0:14:09.040 We tend to be sometimes short term and forget about 0:14:09.080 --> 0:14:12.000 the long term. Asia tend to be more longer term. 0:14:12.640 --> 0:14:17.280 But you have a huge base of private equity investors 0:14:17.520 --> 0:14:19.720 in the US that is looking to invest in the 0:14:19.760 --> 0:14:22.000 region and will continue to invest in the region and 0:14:22.040 --> 0:14:24.080 are willing to take a longer term view. I don't 0:14:24.080 --> 0:14:26.200 think that was the case ten years ago, because you've 0:14:26.240 --> 0:14:31.160 seen fundamental changes in the region notwithstanding the war. But sorry, 0:14:31.160 --> 0:14:33.200 but Asia capital your point, I think, is going to 0:14:33.240 --> 0:14:36.360 be very aggressive, like it has been in Latin America 0:14:36.720 --> 0:14:40.880 likely it's been in Europe through Belton Road, through other 0:14:40.920 --> 0:14:42.440 mechanism that China has developed. 0:14:42.480 --> 0:14:44.560 Absolutely, Sometimes there's a habit to talk about the region 0:14:44.600 --> 0:14:47.200 as a monolith, but it's not who's hit the hardest 0:14:47.240 --> 0:14:49.880 right now? Is it Bahrain in Kuwait? Are they you 0:14:49.880 --> 0:14:51.320 don't need the most money. 0:14:51.800 --> 0:14:55.640 The truth is the people think of these as different countries, 0:14:55.680 --> 0:14:58.240 which of course they are, but they all rely on 0:14:58.440 --> 0:15:02.960 that energy infrastructure which has been hit that I think 0:15:03.000 --> 0:15:06.440 will need to be rebuilt very quickly. Some of it 0:15:06.520 --> 0:15:08.720 will take years. As I said, because I'll give you 0:15:08.720 --> 0:15:12.240 an example today, I want to build in the US 0:15:12.280 --> 0:15:15.720 a power plant. We have huge needs for power plants 0:15:15.800 --> 0:15:19.920 right because of data centers. For me to order a 0:15:19.960 --> 0:15:27.440 turbine from Siemens Mitsubishi ge five to seven years. So 0:15:27.720 --> 0:15:30.160 think about that region where they have to rebuild. It's 0:15:30.200 --> 0:15:33.040 not as much as the cost, as much as the 0:15:33.080 --> 0:15:35.600 time that's going by, so they will have to wait 0:15:35.680 --> 0:15:37.680 quite a bit to be able to rebuild that. So 0:15:37.840 --> 0:15:41.400 it's honestly across all of the energy sector. What has 0:15:41.440 --> 0:15:44.120 been most hit is of course anything that has to 0:15:44.120 --> 0:15:48.160 do with the US, so US basis where US activities 0:15:48.240 --> 0:15:49.840 occurred that was hit. 0:15:50.680 --> 0:15:53.680 What about the trillions of dollars these countries have pledged 0:15:53.720 --> 0:15:57.400 to invest into the United States if the President made 0:15:57.600 --> 0:15:59.720 that huge foreign policy trip last year. 0:16:00.680 --> 0:16:03.800 Yes, I was actually part of that trip with President Trump. 0:16:06.560 --> 0:16:09.640 I think those investments will happen, but maybe will happen 0:16:09.720 --> 0:16:12.640 over a longer period of time than expected. Let's put 0:16:12.640 --> 0:16:13.080 it that way. 0:16:13.120 --> 0:16:13.760 That's what I heard. 0:16:13.800 --> 0:16:15.920 I heard all those investments are now getting kicked down 0:16:15.920 --> 0:16:19.400 the road, kick the can. But for the president, I say, 0:16:19.640 --> 0:16:22.800 this was a huge foreign policy win. 0:16:23.360 --> 0:16:27.480 Yes, you see, there's an irony to that. I think 0:16:27.520 --> 0:16:30.520 those economies are willing to invest in the US. The 0:16:30.600 --> 0:16:35.320 question is in what sector and are we able? Do 0:16:35.400 --> 0:16:38.600 we have the mechanism to take on those investments. So 0:16:38.640 --> 0:16:40.600 it's easy to invest in the stock market, it's much 0:16:40.640 --> 0:16:44.040 more difficult to invest in a multi billion dollar pipeline 0:16:44.040 --> 0:16:48.160 that needs to be built. So ironically, it's the availability 0:16:48.200 --> 0:16:51.840 of projects in the US that is the challenge. The permitting, 0:16:52.160 --> 0:16:57.160 the regulatory frameworks, all that is effectively slowing down the 0:16:57.200 --> 0:16:58.840 ability to observe that kind of capital. 0:16:58.840 --> 0:17:00.280 At least, try to ask the question, and do you 0:17:00.360 --> 0:17:02.920 think the Sundias will stick with liftgolf? Have you got 0:17:02.920 --> 0:17:03.920 an opinion on that, sir? 0:17:04.200 --> 0:17:04.520 None? 0:17:04.600 --> 0:17:07.160 But I think they will stick. Yes, stay with us. 0:17:07.480 --> 0:17:19.960 More Bloomberg surveillance coming up after this and the Savannahs 0:17:20.000 --> 0:17:22.000 this morning. A change of course, we're going to focus 0:17:22.000 --> 0:17:24.359 on a Federal Reserve confirming Kevin Walsh. 0:17:25.760 --> 0:17:29.320 It's time to move on from this. So the petitions 0:17:29.359 --> 0:17:31.520 to the court have been rejected, and I think it's 0:17:31.560 --> 0:17:33.879 time to move on from the case and put our 0:17:33.920 --> 0:17:37.080 attention around getting Kevin Warsh confirmed by the United States Senate. 0:17:37.200 --> 0:17:39.359 Let President Trump have a new partner at the Fed. 0:17:39.680 --> 0:17:42.560 What Treasury Secretary of Bessett have a new partner in 0:17:42.640 --> 0:17:45.600 bank supervision and monetary policy. It's time and I think 0:17:45.600 --> 0:17:46.360 it's important to. 0:17:46.320 --> 0:17:49.480 Move So here's the laces this morning, Kevin WASH's confirmation hearing. 0:17:49.520 --> 0:17:52.280 Facing headwinds. Senator Tom Tiller is still voving to block 0:17:52.320 --> 0:17:55.679 the nomination until the DOJ ends its probe into the 0:17:55.760 --> 0:17:58.320 Central Bank joining us now as Claudia sum of New 0:17:58.400 --> 0:18:01.359 Century Advisors, Claudia, thanks for making some time for today 0:18:01.400 --> 0:18:04.480 once again ahead of an important hearing. I have to say, 0:18:04.520 --> 0:18:07.439 but you're anticipating more theater than signaled and insight in 0:18:07.480 --> 0:18:08.800 the next twenty four hours. 0:18:09.320 --> 0:18:09.520 Well. 0:18:09.560 --> 0:18:13.360 Confirmation hearings always have an aspect of political theater to them. 0:18:13.640 --> 0:18:16.679 But this one, frankly, I think Kevin Worsh might almost 0:18:16.760 --> 0:18:19.080 be a sideshow at his own confirmation hearing. 0:18:19.480 --> 0:18:20.840 President Trump is going to. 0:18:20.880 --> 0:18:24.159 Loom very large in these hearings tomorrow and the pressure 0:18:24.200 --> 0:18:26.720 campaign he's put on the FED, and we might learn 0:18:27.280 --> 0:18:29.399 not so much about Kevin Warsh and his views on 0:18:29.440 --> 0:18:30.480 monetary policy. 0:18:30.920 --> 0:18:31.840 That's that, Claudia. 0:18:32.040 --> 0:18:35.040 It feels like people are on tenter hooks waiting for 0:18:35.119 --> 0:18:37.520 him to give some signal of how high the bar 0:18:37.760 --> 0:18:40.000 is for him to cut rates and exactly what he 0:18:40.040 --> 0:18:42.720 plans to do with the balance sheet? Are you expecting 0:18:42.840 --> 0:18:46.920 no signal from him with respect to cutting rates at 0:18:46.920 --> 0:18:50.320 this moment, given the fact that Secretary Treasury Secretary Scott 0:18:50.320 --> 0:18:53.159 Besson essentially gave him a green light to be a 0:18:53.200 --> 0:18:55.800 little more hawkish than perhaps President Trump would like. 0:18:56.560 --> 0:18:58.760 Well, first of all, somebody's got to ask him about it, 0:18:59.000 --> 0:19:01.040 right again, That's where I mean him not being part 0:19:01.080 --> 0:19:03.119 of the center of focus. If a lot of the 0:19:03.200 --> 0:19:06.680 questions are about President Trump and FED independence and like, that. 0:19:06.720 --> 0:19:08.920 Just wouldn't get to what's Kevin. 0:19:08.680 --> 0:19:12.880 Worsh's reaction function, Like how does he think about what 0:19:12.920 --> 0:19:15.399 the federal funds rate should be what is he balancing? 0:19:15.640 --> 0:19:17.320 And it is difficult. 0:19:16.840 --> 0:19:20.040 Over his career, it's a bit of an enigma what 0:19:20.119 --> 0:19:22.719 his reaction function is. So I think that's absolutely what 0:19:22.760 --> 0:19:24.880 we should be learning about tomorrow. I hope we get 0:19:24.880 --> 0:19:28.159 more guidance from him on this, but again senators have 0:19:28.240 --> 0:19:30.800 got to ask him about and really push him on 0:19:31.080 --> 0:19:33.720 how does he think about setting the federal funds rate. 0:19:33.800 --> 0:19:35.960 We might get some of that tomorrow, but I suspect 0:19:36.000 --> 0:19:36.320 we're not. 0:19:36.280 --> 0:19:38.800 Going to get as much as we really should be 0:19:38.840 --> 0:19:41.439 getting to kind of think about him as a candidate, Claude, 0:19:41.480 --> 0:19:41.800 are you. 0:19:41.760 --> 0:19:44.639 Surprised that the market's been relatively sanguine in the face 0:19:44.800 --> 0:19:47.720 of some real drama and real questions around a who's 0:19:47.760 --> 0:19:50.000 going to be atop the Federal Reserve and be what 0:19:49.960 --> 0:19:52.920 would the composition look like given some of the drama 0:19:52.960 --> 0:19:55.240 with current Fed share J Powell. 0:19:55.440 --> 0:19:59.320 So there has been absolutely nothing normal about this transition 0:19:59.400 --> 0:20:00.680 in leadership at the FED. 0:20:00.920 --> 0:20:02.800 And again that doesn't go back to Kevin Warre. 0:20:02.880 --> 0:20:07.200 Since President Trump has chosen to run the vetting process 0:20:07.240 --> 0:20:09.280 in a certain way, being very clear that he's only 0:20:09.280 --> 0:20:11.600 putting someone in place that wants low interest rates like 0:20:11.640 --> 0:20:14.160 he does the fact that we have an open criminal 0:20:14.160 --> 0:20:17.360 investigation against the current FED chair that's holding. 0:20:17.080 --> 0:20:18.280 Up the confirmation vote. 0:20:18.280 --> 0:20:21.120 We have another governor whose job is before the Supreme 0:20:21.160 --> 0:20:22.520 Court because the president's. 0:20:22.119 --> 0:20:24.639