1 00:00:09,840 --> 00:00:13,800 Speaker 1: Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keane Jay Ley. 2 00:00:13,960 --> 00:00:16,960 Speaker 1: We bring you insight from the best in economics, finance, 3 00:00:17,040 --> 00:00:23,480 Speaker 1: investment and international relations. Find Bloomberg Surveillance on Apple Podcasts, SoundCloud, 4 00:00:23,600 --> 00:00:30,560 Speaker 1: Bloomberg dot Com, and of course, on the Bloomberg Simon 5 00:00:30,640 --> 00:00:34,000 Speaker 1: Kennedy are cricket expert. Here in our studios, Queen Victoria 6 00:00:34,080 --> 00:00:36,559 Speaker 1: Street in charge of all economic government. I don't know 7 00:00:36,560 --> 00:00:40,200 Speaker 1: what Simon does Brexit and anyways, Mr Kennedy said Trent 8 00:00:40,400 --> 00:00:43,160 Speaker 1: Bridge in nodding, I don't know. I can't keep track. 9 00:00:43,640 --> 00:00:47,000 Speaker 1: It's like the prime ministers. Who knows? Notdingham Shire? Is 10 00:00:47,000 --> 00:00:50,720 Speaker 1: that what you call it? Nothingham? Okay, Nottingham That was 11 00:00:50,760 --> 00:00:53,920 Speaker 1: like his childhood home. So for him it's as big 12 00:00:53,960 --> 00:00:56,680 Speaker 1: as it's as big as Lords. But John, I didn't 13 00:00:56,680 --> 00:01:01,200 Speaker 1: know this. Lord sees twenty eight thousand. Well it's cricket. 14 00:01:01,240 --> 00:01:04,399 Speaker 1: It's very cool there and it sells out. And that's 15 00:01:04,400 --> 00:01:08,280 Speaker 1: the voice of David Merritt. Go to cricket, I do, 16 00:01:08,319 --> 00:01:10,279 Speaker 1: go to cricket. I've got my tickets for the summer. 17 00:01:10,280 --> 00:01:12,280 Speaker 1: We've got the World Cup has just started here. Can 18 00:01:12,280 --> 00:01:14,440 Speaker 1: you explaine him, David that it's a good day out 19 00:01:14,480 --> 00:01:17,600 Speaker 1: of drinking. It's an excellent day out. There's a bit 20 00:01:17,600 --> 00:01:22,040 Speaker 1: of sport in the background. There's Pakistan in England and 21 00:01:22,160 --> 00:01:25,560 Speaker 1: people are like totally focused on this. Oh yeah, it's 22 00:01:25,560 --> 00:01:28,000 Speaker 1: a big thing. It's a big thing. I'll take you 23 00:01:28,000 --> 00:01:29,520 Speaker 1: to the game. How long you here for? There's some 24 00:01:30,840 --> 00:01:32,679 Speaker 1: I have to go see the charts, don't I know 25 00:01:32,800 --> 00:01:39,720 Speaker 1: that season's ended. Spurs done for the sleeping until everybody 26 00:01:39,840 --> 00:01:43,880 Speaker 1: on a coast to coast in America's thank god, Premier 27 00:01:43,959 --> 00:01:45,880 Speaker 1: League is done. I think there's a South American Cup 28 00:01:45,880 --> 00:01:48,160 Speaker 1: that we can discuss, though, to fill in the boordom 29 00:01:48,320 --> 00:01:50,240 Speaker 1: over the next coup, we have two esteemed guests here 30 00:01:50,240 --> 00:01:52,320 Speaker 1: with a date calendar to a press company. We do 31 00:01:52,400 --> 00:01:55,440 Speaker 1: Jenny Lennard joining a swell Bloomberg trade reporter David help 32 00:01:55,560 --> 00:01:58,040 Speaker 1: us set us up in about what an hour from now, 33 00:01:58,240 --> 00:02:01,280 Speaker 1: a joint news conference. I have no idea what it's about. 34 00:02:01,280 --> 00:02:03,160 Speaker 1: What is it about? Well, it's going to be about everything. 35 00:02:03,320 --> 00:02:05,560 Speaker 1: I suspect, you know, this is this the last time 36 00:02:05,600 --> 00:02:07,640 Speaker 1: that's happened. Last time the president came, it went on 37 00:02:07,720 --> 00:02:09,800 Speaker 1: for I think much longer than an hour. He takes 38 00:02:09,880 --> 00:02:12,919 Speaker 1: questions from everybody. He has rather long answers, and there's 39 00:02:12,960 --> 00:02:16,440 Speaker 1: a lot to cover here. We have Brexit obviously lurking 40 00:02:16,440 --> 00:02:18,839 Speaker 1: in the background. We have the question, a big question 41 00:02:18,919 --> 00:02:21,320 Speaker 1: about the US trade deal what that might look like. 42 00:02:21,440 --> 00:02:23,959 Speaker 1: Lots of controversial comments from the American side. The last 43 00:02:23,960 --> 00:02:26,360 Speaker 1: couple of days, Mrs May is gonna be asked about that. 44 00:02:26,600 --> 00:02:30,000 Speaker 1: We've got questions about Iran, questions about Europe, and of 45 00:02:30,040 --> 00:02:33,760 Speaker 1: course the big one who is Mrs May's successor going 46 00:02:33,800 --> 00:02:37,360 Speaker 1: to be Um? He is not shy about wading into 47 00:02:37,400 --> 00:02:40,200 Speaker 1: that debate, and you can bet your going to be 48 00:02:40,360 --> 00:02:44,280 Speaker 1: really awkward. I agree, Jenny, this as important as you 49 00:02:44,320 --> 00:02:47,840 Speaker 1: work out of Washington, and of course the expertise is trade. 50 00:02:48,320 --> 00:02:50,959 Speaker 1: How would you suggest a president or response you after 51 00:02:51,000 --> 00:02:54,400 Speaker 1: the pump and circumstance of forty eight hours when somebody 52 00:02:54,400 --> 00:02:57,680 Speaker 1: goes something about Mueller or bar or name the other 53 00:02:57,760 --> 00:03:02,680 Speaker 1: scandal of your Washington, How does responned well? Trade for 54 00:03:02,880 --> 00:03:06,360 Speaker 1: President Trump is always sort of a pivot away from 55 00:03:06,480 --> 00:03:10,880 Speaker 1: domestic politics. Are ugly? Yeah, somebody brings up Mexico and 56 00:03:11,080 --> 00:03:13,600 Speaker 1: immigration in the border wall. Is he going to be 57 00:03:13,639 --> 00:03:17,200 Speaker 1: offended that these questions are being asked in England? I 58 00:03:17,440 --> 00:03:21,080 Speaker 1: don't know that he will be defensive about it. I 59 00:03:21,080 --> 00:03:24,960 Speaker 1: think he's actually about the Mexico border wall and his 60 00:03:25,360 --> 00:03:28,320 Speaker 1: latest announcement of tariffs coming on Mexico. I think he's 61 00:03:28,360 --> 00:03:30,919 Speaker 1: happy to talk about that. I think he's pretty confident 62 00:03:30,960 --> 00:03:34,400 Speaker 1: that that will, you know, solve the problem that you know, 63 00:03:34,480 --> 00:03:36,760 Speaker 1: no one in Congress is going to throw a wrench 64 00:03:36,840 --> 00:03:40,200 Speaker 1: in that. And and I'm sure who would be happy 65 00:03:40,240 --> 00:03:42,360 Speaker 1: to ask answer all kinds of questions. It's difficult to 66 00:03:42,360 --> 00:03:45,320 Speaker 1: find a topic that both individuals can speak to that 67 00:03:45,440 --> 00:03:47,480 Speaker 1: just seems to be a bunch of separate, different things 68 00:03:47,520 --> 00:03:49,000 Speaker 1: going on that you want to one ask Prime Minister 69 00:03:49,040 --> 00:03:50,760 Speaker 1: make and that you would like to ask the President 70 00:03:50,760 --> 00:03:53,360 Speaker 1: of the United States. One thing of a couple of 71 00:03:53,360 --> 00:03:56,080 Speaker 1: things that I think both can speak to is Shuawei David, 72 00:03:56,520 --> 00:03:58,120 Speaker 1: and I just wonder to what degree that has been 73 00:03:58,160 --> 00:04:00,240 Speaker 1: discussed in the last twenty four hounds. Yeah, well this 74 00:04:00,280 --> 00:04:02,080 Speaker 1: is this is definitely on the agenda when the two 75 00:04:02,280 --> 00:04:04,920 Speaker 1: met in Danning Street earlier today. And again, of course 76 00:04:04,960 --> 00:04:07,520 Speaker 1: it's something else that they both disagree on. Mr Trump's 77 00:04:07,560 --> 00:04:10,200 Speaker 1: trying to ladle on the pressure for Britain to change 78 00:04:10,200 --> 00:04:13,960 Speaker 1: its mind and to join with them in restricting Hawawei 79 00:04:14,040 --> 00:04:16,679 Speaker 1: completely from building the five G networks. So far Britain 80 00:04:16,960 --> 00:04:19,400 Speaker 1: has said it's it needs Huawei, it needs this to 81 00:04:19,440 --> 00:04:22,440 Speaker 1: do it in a in a cost effective measure. Um 82 00:04:22,520 --> 00:04:24,520 Speaker 1: that is she going to crumble? Is she going to say? Well, 83 00:04:24,520 --> 00:04:26,840 Speaker 1: in fact, the Americans have helped just change her. Then 84 00:04:26,880 --> 00:04:30,080 Speaker 1: twisting there and dug what what what are the ramifications 85 00:04:30,120 --> 00:04:33,360 Speaker 1: if she crumbles or doesn't crumble? Well, the big arm 86 00:04:33,360 --> 00:04:37,400 Speaker 1: twisting is around the sharing of intelligence Britain and America. 87 00:04:37,880 --> 00:04:41,359 Speaker 1: Britain particularly prides itself on being having this special access 88 00:04:41,640 --> 00:04:44,760 Speaker 1: to American intelligence and that has been one has been 89 00:04:44,800 --> 00:04:47,800 Speaker 1: put at threat in the last few weeks. They've said, well, look, 90 00:04:47,839 --> 00:04:49,800 Speaker 1: if you're going to insist on having your networks done 91 00:04:49,800 --> 00:04:51,480 Speaker 1: by Huawei, we're not gonna be able to send you 92 00:04:51,680 --> 00:04:54,720 Speaker 1: all of our intelligence. Johnian Leonard the Bucking Impels yesterday, 93 00:04:54,760 --> 00:04:57,400 Speaker 1: along with Secretary Molution taking a video of it off 94 00:04:57,400 --> 00:05:00,440 Speaker 1: as iPhone, were the worthies of the Trump at wustration 95 00:05:00,520 --> 00:05:02,960 Speaker 1: lined up. And there was Steven Miller who was on 96 00:05:03,000 --> 00:05:05,560 Speaker 1: the trip and he's part of the border wall in 97 00:05:05,680 --> 00:05:09,520 Speaker 1: immigration debate. How does he fit in to the trip 98 00:05:09,680 --> 00:05:12,320 Speaker 1: and how does he fit in to the linkage to 99 00:05:12,400 --> 00:05:16,880 Speaker 1: trade with Mexico. Good question that the trip, it's you 100 00:05:17,000 --> 00:05:20,920 Speaker 1: got it gets a good question. The trumpet wise advisors 101 00:05:20,960 --> 00:05:22,960 Speaker 1: that came on the trip kind of do not fit 102 00:05:23,000 --> 00:05:25,200 Speaker 1: in its minutent. And his wife here but you know 103 00:05:25,360 --> 00:05:27,240 Speaker 1: they're talking about trade in the U. S. Trade rep 104 00:05:27,279 --> 00:05:31,960 Speaker 1: isn't coming, so you know, is not here. He's not here, 105 00:05:32,240 --> 00:05:34,160 Speaker 1: He's not part of the trip, which I think the 106 00:05:34,160 --> 00:05:37,360 Speaker 1: constellation of people is a little bit interesting. Stephen Miller 107 00:05:37,520 --> 00:05:41,320 Speaker 1: is of course, one of the architects of Trump's immigration policy. 108 00:05:41,839 --> 00:05:45,560 Speaker 1: UH to Wawwei. I think one interesting thing is that 109 00:05:45,640 --> 00:05:48,720 Speaker 1: Trump himself isn't really consistent when he talks about Wawei, 110 00:05:48,800 --> 00:05:51,080 Speaker 1: right well, I mean we heard him. We heard him 111 00:05:51,120 --> 00:05:54,680 Speaker 1: say before he left for Japan a couple of weeks ago, 112 00:05:54,800 --> 00:05:58,000 Speaker 1: you know, Wawe is a really big intelligence risk. Our 113 00:05:58,120 --> 00:06:00,599 Speaker 1: national security folks are really were read about it. And 114 00:06:00,600 --> 00:06:03,239 Speaker 1: in the next sentence he says, well, maybe we wrap 115 00:06:03,279 --> 00:06:05,960 Speaker 1: this into a trade deal, which makes his advisors, his 116 00:06:06,080 --> 00:06:09,719 Speaker 1: national security advisors, really uncomfortable because they don't want to 117 00:06:10,000 --> 00:06:11,719 Speaker 1: want this to be, you know, kind of part of 118 00:06:11,720 --> 00:06:14,520 Speaker 1: a trade discussion that could be traded away because they 119 00:06:14,560 --> 00:06:19,159 Speaker 1: want actually to focus on uh you know, convincing allies 120 00:06:19,200 --> 00:06:22,000 Speaker 1: like the UK to go through with banning Hua Awei 121 00:06:22,000 --> 00:06:24,600 Speaker 1: from from this. So we'll see if Trump gets asked 122 00:06:24,600 --> 00:06:27,120 Speaker 1: about it, if he has a consistent message here, uh, 123 00:06:27,160 --> 00:06:30,600 Speaker 1: and then and then we'll see what Primeister may have. Jenny, 124 00:06:30,600 --> 00:06:33,880 Speaker 1: certainly at home, no problem convincing both Democrats and Republicans 125 00:06:33,880 --> 00:06:36,440 Speaker 1: of the push around China and Huaweifi that matter. When 126 00:06:36,480 --> 00:06:39,920 Speaker 1: it comes to Mexico a very different story. Interesting development overnight, 127 00:06:40,000 --> 00:06:43,400 Speaker 1: some great reporting from the team in Washington, Jenny that 128 00:06:43,480 --> 00:06:46,480 Speaker 1: maybe Senate Republicans are looking to push back against this effort. 129 00:06:46,800 --> 00:06:49,520 Speaker 1: How can they formalize that? What can they do so 130 00:06:49,600 --> 00:06:53,560 Speaker 1: they could pass a resolution of disapproval, which you have 131 00:06:53,680 --> 00:06:56,719 Speaker 1: to overcome a mutual proof majority, which we've seen in 132 00:06:56,760 --> 00:06:58,880 Speaker 1: the past when they have tried to do that. That's 133 00:06:58,880 --> 00:07:02,160 Speaker 1: actually more difficult then you think. And I would note 134 00:07:02,600 --> 00:07:05,720 Speaker 1: to anyone who you know is looking at this with 135 00:07:05,839 --> 00:07:09,240 Speaker 1: maybe some optimism that Congress could stop Trump on his 136 00:07:09,320 --> 00:07:12,360 Speaker 1: trade agenda, don't hold your breath. We've seen this before 137 00:07:13,000 --> 00:07:17,240 Speaker 1: on national security tariffs, steal aluminum with autos. We've seen 138 00:07:17,360 --> 00:07:19,880 Speaker 1: kind of a momentum even from his own party saying 139 00:07:20,000 --> 00:07:22,880 Speaker 1: this might be a step too far. I don't know 140 00:07:22,920 --> 00:07:25,280 Speaker 1: if they can actually swing this one. And now one 141 00:07:25,360 --> 00:07:29,080 Speaker 1: final question, fair when I counting the minutes of no Brexit, 142 00:07:29,560 --> 00:07:33,840 Speaker 1: no leave, are you bringing question David? I have to Okay, 143 00:07:33,960 --> 00:07:37,600 Speaker 1: there's the headline the President maybe we'll meet with Mr Gove. 144 00:07:38,280 --> 00:07:42,080 Speaker 1: What level of Brexit is Mr Gov And does the 145 00:07:42,160 --> 00:07:45,400 Speaker 1: President greet him as a brexit here like the others. Well, 146 00:07:45,400 --> 00:07:48,920 Speaker 1: he suddenly was one of the architects of the Brexit campaign. 147 00:07:48,960 --> 00:07:51,840 Speaker 1: But if you look at the spectrum now, or that 148 00:07:51,880 --> 00:07:57,120 Speaker 1: the Brexit rainbow, if you like, the Tory hits somewhere 149 00:07:57,120 --> 00:07:59,160 Speaker 1: in the middle. Actually, you know he's not actually going 150 00:07:59,160 --> 00:08:02,840 Speaker 1: out and advocates we storm out with no deal come 151 00:08:02,880 --> 00:08:05,280 Speaker 1: what may, which is what Mr Johnson and Mr rob 152 00:08:05,600 --> 00:08:08,360 Speaker 1: are saying. He was the one who stuck by Mrs 153 00:08:08,400 --> 00:08:11,800 Speaker 1: Maid through second thin. He voted for her deal. Remember 154 00:08:11,840 --> 00:08:16,520 Speaker 1: he didn't leave the cabinet saying this is a subject 155 00:08:16,560 --> 00:08:19,480 Speaker 1: in Britain to European laws forever. So here's a loyalist 156 00:08:19,760 --> 00:08:22,240 Speaker 1: to the Prime minister. He is more of a Centrists. 157 00:08:22,400 --> 00:08:24,920 Speaker 1: He says we should find a middle way. And it's 158 00:08:25,040 --> 00:08:27,200 Speaker 1: very interesting that Mr Trump has chosen to use his 159 00:08:27,240 --> 00:08:30,080 Speaker 1: spare time this afteron to meet with him rather than 160 00:08:30,440 --> 00:08:33,440 Speaker 1: with Mr Johnson, as was suggesting very kind to Mr 161 00:08:33,640 --> 00:08:40,439 Speaker 1: of describing him as a loyalist. Well, okay, strategically known 162 00:08:40,480 --> 00:08:45,400 Speaker 1: as Macbeth. But he has I think it's undeniable, you know, 163 00:08:45,920 --> 00:08:49,439 Speaker 1: he was. He was the heaviest way to actually stick 164 00:08:49,480 --> 00:08:52,280 Speaker 1: with Mrs Mayor throughout this. Now you can you can 165 00:08:52,360 --> 00:08:54,400 Speaker 1: question his motives for that? Is it because he was 166 00:08:54,480 --> 00:08:57,080 Speaker 1: lining himself up for where he is now for the job. 167 00:08:57,160 --> 00:09:01,680 Speaker 1: Possibly David the windsor lamb snap? Is that like lambs 168 00:09:01,679 --> 00:09:03,839 Speaker 1: that they kill off the hills of the winter. I 169 00:09:03,840 --> 00:09:06,040 Speaker 1: don't think they go out and shoot them themselves like 170 00:09:06,120 --> 00:09:09,240 Speaker 1: they do the deer. Perhaps in the pheasant I think 171 00:09:09,280 --> 00:09:11,000 Speaker 1: they're probably sent to the Abbotts Fare, but I guess 172 00:09:11,040 --> 00:09:12,800 Speaker 1: they must be. They're a sheep and I walk my 173 00:09:12,840 --> 00:09:14,840 Speaker 1: dog and wins a great park sometimes that the weekend, 174 00:09:14,880 --> 00:09:18,360 Speaker 1: and there are definitely you know, dotted sheep. You should 175 00:09:18,400 --> 00:09:21,160 Speaker 1: get over to. Winter is beautiful. I can't compete with this, 176 00:09:21,280 --> 00:09:23,600 Speaker 1: me and Vette mill for making it out of the 177 00:09:23,960 --> 00:09:28,200 Speaker 1: circle park and we're lucky to the baseball. You do 178 00:09:28,280 --> 00:09:30,480 Speaker 1: what with your dog? Well it's not far, you know, 179 00:09:30,600 --> 00:09:32,760 Speaker 1: my my son goes to schooler there, so I I 180 00:09:33,240 --> 00:09:36,400 Speaker 1: walk my dog And how do you say it's like 181 00:09:36,520 --> 00:09:42,920 Speaker 1: nasty Bush. I don't think. I don't think says nasty. 182 00:09:43,480 --> 00:09:45,400 Speaker 1: You get all sorts of around wins. And I'm telling you, 183 00:09:45,679 --> 00:09:48,200 Speaker 1: David Merrick, we're saying thank you to David, were saying 184 00:09:48,240 --> 00:09:51,600 Speaker 1: thank you to Jenny, and we're going from London for 185 00:09:51,640 --> 00:09:56,640 Speaker 1: our audience worldwide this Unfortunately today it's still Bloomberg surveillance. 186 00:10:11,760 --> 00:10:14,439 Speaker 1: Let's bringing mind Ryan Shower you bus Americans see I oh, 187 00:10:14,520 --> 00:10:16,439 Speaker 1: he joins us on this program. Great to catch up with. 188 00:10:16,480 --> 00:10:18,319 Speaker 1: You might walk us through the essence of the research 189 00:10:18,360 --> 00:10:20,800 Speaker 1: that you guys have put out. Well, good more and Jonathan, 190 00:10:20,800 --> 00:10:22,560 Speaker 1: thank you. Well. First of all we try to do 191 00:10:22,600 --> 00:10:24,839 Speaker 1: is we tried to lay the framework out for what's 192 00:10:24,880 --> 00:10:28,319 Speaker 1: likely to be a pretty certainly entertaining but also informative 193 00:10:28,640 --> 00:10:30,520 Speaker 1: series of debates that are going to happen between the 194 00:10:30,559 --> 00:10:33,319 Speaker 1: Democratic candidates, but also begin to set our sitelines a 195 00:10:33,360 --> 00:10:35,920 Speaker 1: little further afield. Obviously, the election is going to have 196 00:10:35,960 --> 00:10:38,920 Speaker 1: huge implications not only in terms of who is a 197 00:10:38,960 --> 00:10:41,320 Speaker 1: resident of the White House, but also the composition of Congress. 198 00:10:41,920 --> 00:10:43,600 Speaker 1: Before we get there, though, we need to talk about 199 00:10:43,600 --> 00:10:45,360 Speaker 1: what the major issues are going to be focused on. 200 00:10:45,600 --> 00:10:46,960 Speaker 1: So one of the things we did in that report 201 00:10:47,000 --> 00:10:50,120 Speaker 1: was we highlighted a number of focus issues they we're 202 00:10:50,120 --> 00:10:52,840 Speaker 1: gonna be writing follow up reports on over the course 203 00:10:52,920 --> 00:10:55,600 Speaker 1: of between now and the election. These includes in issues 204 00:10:55,760 --> 00:10:59,560 Speaker 1: ranging from a regulatory environment, to tax issues, to health care, 205 00:10:59,600 --> 00:11:02,920 Speaker 1: to and for structure immigration policies. These are things that 206 00:11:02,960 --> 00:11:05,160 Speaker 1: are critical not only to voters, but certainly two investors 207 00:11:05,200 --> 00:11:08,960 Speaker 1: as well. Looking at the situation, going into something a 208 00:11:08,960 --> 00:11:12,440 Speaker 1: lot of people got very very wrong was framing the 209 00:11:12,520 --> 00:11:15,480 Speaker 1: president of the United States now President Donald Trump as 210 00:11:15,520 --> 00:11:18,360 Speaker 1: the risk off candidate, the high vul risk golf candidate 211 00:11:18,400 --> 00:11:20,720 Speaker 1: Mike And what we found out subsequently is he was 212 00:11:20,720 --> 00:11:23,439 Speaker 1: anything but for much of the first year. How are 213 00:11:23,440 --> 00:11:26,560 Speaker 1: we framing the two parties from a market perspective just 214 00:11:26,600 --> 00:11:29,200 Speaker 1: in terms that he invest the bias? Right now, what 215 00:11:29,440 --> 00:11:32,800 Speaker 1: is it around these two parties? Well, I do think 216 00:11:32,800 --> 00:11:35,360 Speaker 1: when you when you think about the potential candidates, and 217 00:11:35,360 --> 00:11:38,640 Speaker 1: obviously it's it's very very early start handicapping who could 218 00:11:38,840 --> 00:11:42,079 Speaker 1: emerge from the Democratic field as the as the ultimate nominee. 219 00:11:42,320 --> 00:11:44,640 Speaker 1: But as we think about this um, this field where 220 00:11:44,640 --> 00:11:47,040 Speaker 1: we're gonna be focused on now is where the policy 221 00:11:47,320 --> 00:11:49,800 Speaker 1: pass start to lead. Obviously, one of the things we 222 00:11:49,840 --> 00:11:53,760 Speaker 1: saw from the election of Donald Trump was a focus 223 00:11:53,800 --> 00:11:56,320 Speaker 1: on several things. One was on regulatory reform and others 224 00:11:56,360 --> 00:11:59,400 Speaker 1: on tax relief, which were very market friendly the concerns. 225 00:11:59,440 --> 00:12:02,240 Speaker 1: Of course, whoever emerged from the Democratic field could take 226 00:12:02,240 --> 00:12:04,439 Speaker 1: a very very different posture on both of those. That 227 00:12:04,520 --> 00:12:07,320 Speaker 1: could be talking about increasing taxes in the way of 228 00:12:07,559 --> 00:12:10,880 Speaker 1: closing the duct the budget deficit, but also of reimposing 229 00:12:10,920 --> 00:12:13,200 Speaker 1: some of the regulations that have been put in place 230 00:12:13,240 --> 00:12:16,280 Speaker 1: during the Obama administration. Mike, what's fascinating to me, And 231 00:12:16,400 --> 00:12:18,600 Speaker 1: this is the last couple of days, I've seen articles 232 00:12:18,600 --> 00:12:23,120 Speaker 1: that clearly show there's no policy traction yet among the 233 00:12:23,160 --> 00:12:25,960 Speaker 1: many Democratic candidates, people learned focused on it, which I 234 00:12:26,360 --> 00:12:29,360 Speaker 1: you know, I guess I understand. I guess we learned 235 00:12:29,400 --> 00:12:32,920 Speaker 1: healthcare mattered in the mid terms. Do we get to 236 00:12:33,040 --> 00:12:37,720 Speaker 1: the first or the fourth or debate in healthcare just 237 00:12:38,480 --> 00:12:41,840 Speaker 1: becomes the topic as we saw in the mid terms, 238 00:12:42,720 --> 00:12:44,400 Speaker 1: It certainly could be time. I think it's gonna be. 239 00:12:44,600 --> 00:12:46,640 Speaker 1: First of all, as as you as you mentioned, it's 240 00:12:46,640 --> 00:12:50,680 Speaker 1: it's really early to story handicapping exactly how the policy 241 00:12:50,720 --> 00:12:53,200 Speaker 1: path will map out and also who will emerge as 242 00:12:53,240 --> 00:12:56,560 Speaker 1: the primary candidates. However, when you look across the field, 243 00:12:56,800 --> 00:12:59,720 Speaker 1: what you do see as some commonality, healthcare is one 244 00:12:59,760 --> 00:13:02,680 Speaker 1: of the that emerges from almost all of the potential 245 00:13:02,720 --> 00:13:05,400 Speaker 1: candidates from the Democratic side. So there's no question that 246 00:13:05,520 --> 00:13:10,720 Speaker 1: over the course of debates and going into the party convention, 247 00:13:11,120 --> 00:13:13,120 Speaker 1: healthcare is going to emerge. Is one of the critical 248 00:13:13,120 --> 00:13:16,480 Speaker 1: issues for the Democrats. Listening to some investors out there, 249 00:13:16,480 --> 00:13:19,079 Speaker 1: I always think that some investors receive more attention that 250 00:13:19,160 --> 00:13:22,280 Speaker 1: maybe they deserve. Stan Drumla is not one of those investors. 251 00:13:22,320 --> 00:13:25,040 Speaker 1: He spoke yesterday evening and said the following when the 252 00:13:25,080 --> 00:13:27,480 Speaker 1: Trump tweet went out. He's referring to the Trump tweet 253 00:13:27,720 --> 00:13:30,200 Speaker 1: on China. A number of weeks ago, I went from 254 00:13:31,320 --> 00:13:34,480 Speaker 1: invested to net flat and bought a bunch of treasuries. 255 00:13:34,520 --> 00:13:36,640 Speaker 1: Not because I'm trying to make money. I just don't 256 00:13:36,679 --> 00:13:39,880 Speaker 1: want to play in this environment. Talk to me about 257 00:13:39,920 --> 00:13:43,120 Speaker 1: this environment right now and whether you can play in 258 00:13:43,120 --> 00:13:47,040 Speaker 1: this environment. Well, we want to be really careful about it. 259 00:13:47,160 --> 00:13:50,240 Speaker 1: Is not to play two tactically against trade. You know, 260 00:13:50,400 --> 00:13:52,760 Speaker 1: our our view as we want to maintain a relatively 261 00:13:52,760 --> 00:13:55,640 Speaker 1: balanced portfolio or ultimate view is that we do think 262 00:13:55,720 --> 00:13:58,240 Speaker 1: a pathway will be found for a framework and an 263 00:13:58,240 --> 00:14:00,920 Speaker 1: agreement between the US and China. But remember John, this 264 00:14:01,000 --> 00:14:02,959 Speaker 1: is the the issues that the U. S And China 265 00:14:03,000 --> 00:14:05,720 Speaker 1: are contending with have been decades in the making. The 266 00:14:05,760 --> 00:14:07,640 Speaker 1: notion that we're gonna solve this in in six or 267 00:14:07,679 --> 00:14:09,800 Speaker 1: twelve or eighteen months, or that we're gonna come to 268 00:14:09,840 --> 00:14:12,480 Speaker 1: this comprehensive agreement that the two parties signed have a 269 00:14:12,559 --> 00:14:15,320 Speaker 1: big signing ceremony, I think it's all native. Instead, I 270 00:14:15,320 --> 00:14:17,840 Speaker 1: think you'll see is they will be First of all, 271 00:14:18,040 --> 00:14:20,160 Speaker 1: we do expect to see some more back and forth 272 00:14:20,160 --> 00:14:22,360 Speaker 1: between the U. S and China, but ultimately it's it's 273 00:14:22,400 --> 00:14:24,640 Speaker 1: in both parties interests to come to some sort of 274 00:14:24,680 --> 00:14:28,480 Speaker 1: framework that allows for the following the eventual easing of tariffs, 275 00:14:28,480 --> 00:14:31,000 Speaker 1: but it has to come with verification. But you mentioned 276 00:14:31,040 --> 00:14:33,840 Speaker 1: the key item, and we've heard this in London in 277 00:14:33,920 --> 00:14:39,800 Speaker 1: different conversations in both parties interests is a rational statement. 278 00:14:40,480 --> 00:14:45,840 Speaker 1: Have we seen rationality in these trade debates? You can 279 00:14:45,960 --> 00:14:48,360 Speaker 1: argue there has been rationality because so forth it's has 280 00:14:48,400 --> 00:14:50,760 Speaker 1: been about how you posture and how you try and 281 00:14:50,760 --> 00:14:53,880 Speaker 1: gain tech for advantages. Nothing there's nothing irrational about that. 282 00:14:54,120 --> 00:14:55,920 Speaker 1: What it is irrational is if you take it to 283 00:14:56,360 --> 00:14:59,000 Speaker 1: its endgame, where you see both parties back in the 284 00:14:59,080 --> 00:15:02,800 Speaker 1: corns into a corner. But I'm looking at West Texas Intermediate, 285 00:15:03,120 --> 00:15:06,440 Speaker 1: which John I haven't really brought up in weeks, and 286 00:15:06,840 --> 00:15:11,800 Speaker 1: I've got an exceptionally elegant shirt from sixty three straight 287 00:15:11,800 --> 00:15:14,480 Speaker 1: down to one. And you know, you look at as 288 00:15:14,480 --> 00:15:17,680 Speaker 1: a proxy for global demand, oil demand and also the 289 00:15:17,680 --> 00:15:21,360 Speaker 1: economic demand. It's out there and it's speaking volumes. I 290 00:15:21,360 --> 00:15:23,360 Speaker 1: think reading the data right now, it's really difficult. We 291 00:15:23,360 --> 00:15:26,520 Speaker 1: had some I S M and P M I yesterday 292 00:15:26,640 --> 00:15:29,760 Speaker 1: weakness Tom and slightly disappointing as well. Relative to the 293 00:15:29,920 --> 00:15:34,000 Speaker 1: solid economy that was painted by the data, yeah, a 294 00:15:34,080 --> 00:15:36,520 Speaker 1: number of months ago. It's not there in the same way. 295 00:15:36,840 --> 00:15:39,040 Speaker 1: And I think if there's any anxiety right now, Mike, 296 00:15:39,040 --> 00:15:41,800 Speaker 1: it's always about the DOWTA. Where does the change come from? 297 00:15:41,840 --> 00:15:45,000 Speaker 1: In China, we know it's weaker relative to where we 298 00:15:45,000 --> 00:15:47,360 Speaker 1: were before. In Europe, we know it's weaker relatives to 299 00:15:47,360 --> 00:15:50,320 Speaker 1: where we before we were before. The unknown seems to 300 00:15:50,320 --> 00:15:52,520 Speaker 1: be the United States, Mike. What is happening with the 301 00:15:52,760 --> 00:15:54,880 Speaker 1: this U S economy? Is it just a return to 302 00:15:54,920 --> 00:15:58,640 Speaker 1: trend growth or do we overshoot? What's the answer, Mike, Yeah, 303 00:15:58,640 --> 00:16:00,920 Speaker 1: I don't think we overshoot at I think with you're saying, look, 304 00:16:00,960 --> 00:16:04,640 Speaker 1: we've had these these periodic growth slowdowns throughout this entire expansion. 305 00:16:04,640 --> 00:16:06,720 Speaker 1: I think we're seeing one right now. I'd also argue 306 00:16:06,760 --> 00:16:08,240 Speaker 1: that if you if you actually look through the data, 307 00:16:08,240 --> 00:16:10,480 Speaker 1: we are starting to see some signs now of some 308 00:16:10,560 --> 00:16:12,840 Speaker 1: underlying strength. So we don't think the economy is set 309 00:16:12,840 --> 00:16:15,440 Speaker 1: to roll over, nor do we think their session risks 310 00:16:15,440 --> 00:16:18,200 Speaker 1: are particularly acute. We are walking through a period of 311 00:16:18,600 --> 00:16:21,960 Speaker 1: weaker data at least certainly versus consensus expectations, but we 312 00:16:22,000 --> 00:16:24,720 Speaker 1: still expect to see growth somewhere towards trend over the 313 00:16:24,720 --> 00:16:28,280 Speaker 1: course of this year. In two thousand two, Micael Ryan, 314 00:16:28,320 --> 00:16:31,240 Speaker 1: thank you so much with ubs political statement, and of 315 00:16:31,280 --> 00:16:33,040 Speaker 1: course we will have much more from Mr Ryan and 316 00:16:33,040 --> 00:16:51,320 Speaker 1: his team in the coming eighteen months. Guy Johnson is 317 00:16:51,400 --> 00:16:54,360 Speaker 1: with us who has memorized the resume of every prime 318 00:16:54,400 --> 00:16:57,360 Speaker 1: minister of candidate. At the end there Guy Johnson, who 319 00:16:57,440 --> 00:17:01,840 Speaker 1: is Jeremy that he was speaking down to Mr Jeremy Hunt, 320 00:17:02,000 --> 00:17:06,919 Speaker 1: the Foreign Secretary um and asking him whether or not 321 00:17:07,080 --> 00:17:09,399 Speaker 1: one of his competitors would do a good job. And 322 00:17:09,440 --> 00:17:11,359 Speaker 1: I suspect that, Jeremy, what are the shades of the 323 00:17:11,480 --> 00:17:13,680 Speaker 1: What are the shades of the Conservative Party right now? 324 00:17:13,760 --> 00:17:17,320 Speaker 1: For Americans? Are American listeners in Morning America? I would 325 00:17:17,359 --> 00:17:20,199 Speaker 1: suggest it's a bit confusing. There's Boris with a hair 326 00:17:20,359 --> 00:17:24,200 Speaker 1: like Trump, and there's everybody else. What are the shades? Yeah, 327 00:17:24,600 --> 00:17:26,399 Speaker 1: interuting to see the two standing next door to each other, 328 00:17:26,440 --> 00:17:30,119 Speaker 1: wouldn't it We may you never know that might that 329 00:17:30,240 --> 00:17:33,520 Speaker 1: might happen? And as the President suggested, um that the 330 00:17:33,560 --> 00:17:36,400 Speaker 1: two our friends. Um. Look, basically, you've got a Conservative 331 00:17:36,400 --> 00:17:39,320 Speaker 1: Party split into two basic factions, one of which is 332 00:17:39,320 --> 00:17:42,560 Speaker 1: the hard Brexiteers, of which Boris Johnson is the most 333 00:17:42,640 --> 00:17:45,240 Speaker 1: obvious candidate, but there are others, and then you've got 334 00:17:45,240 --> 00:17:48,000 Speaker 1: the more centrist candidates who are pushing back and are 335 00:17:48,000 --> 00:17:53,320 Speaker 1: concerned about the possibility of a hard Brexit. Um. The 336 00:17:53,359 --> 00:17:57,000 Speaker 1: Conservative Party has sort of been split in this way 337 00:17:57,520 --> 00:18:00,679 Speaker 1: for really quite some time. At the moment, Tom, the 338 00:18:00,720 --> 00:18:03,240 Speaker 1: best thing is that a hard Brexit here is likely 339 00:18:03,280 --> 00:18:06,359 Speaker 1: to win out if that is Boris Johnson, will he 340 00:18:06,400 --> 00:18:10,399 Speaker 1: actually deliver upon that hard brexit? Boris has changed his 341 00:18:10,480 --> 00:18:12,960 Speaker 1: spots one or two times. Yes, I see that within 342 00:18:13,000 --> 00:18:18,240 Speaker 1: the British media, the vibrant newspapers of this London. You 343 00:18:18,320 --> 00:18:21,199 Speaker 1: see that every day. But then you get to October 344 00:18:21,400 --> 00:18:24,840 Speaker 1: thirty one, every date has been extended. Do you and 345 00:18:24,880 --> 00:18:28,240 Speaker 1: the British media just assume it's another can to be 346 00:18:28,359 --> 00:18:31,680 Speaker 1: kicking down the road? We went see, we can probably 347 00:18:31,680 --> 00:18:34,000 Speaker 1: ask the question to the French. The French seemed very 348 00:18:34,080 --> 00:18:37,760 Speaker 1: keen that that date is more firm than maybe others 349 00:18:37,840 --> 00:18:40,520 Speaker 1: are suggesting at this stage that a deal needs to 350 00:18:40,560 --> 00:18:43,080 Speaker 1: be done. At this point, I think it's very hard 351 00:18:43,119 --> 00:18:44,919 Speaker 1: to get your arms around understanding whether or not that 352 00:18:44,960 --> 00:18:47,800 Speaker 1: would be the case. Um, I think the EU would 353 00:18:47,800 --> 00:18:50,600 Speaker 1: be nervous about forcing a hard Brexit. Are you with 354 00:18:50,720 --> 00:18:53,800 Speaker 1: Ronnie Queen here? In twenty minutes? I am with Fonny 355 00:18:53,880 --> 00:18:56,000 Speaker 1: quin will be in New York, though I'll be I'll 356 00:18:56,000 --> 00:18:58,520 Speaker 1: be with her here. She'll be with me in spirit 357 00:18:58,600 --> 00:19:00,800 Speaker 1: here as well. Wonderful chemistry as well there between the 358 00:19:00,840 --> 00:19:03,639 Speaker 1: Irish and the Britishers of Anny Quinn and Guy Johnson 359 00:19:04,080 --> 00:19:20,679 Speaker 1: moved the dialogue Ford on Bloomberg Television, Tom, we are 360 00:19:20,880 --> 00:19:23,680 Speaker 1: very fortunate to welcome to the Bloomberg and Actor Broker 361 00:19:23,800 --> 00:19:28,200 Speaker 1: Studio Bob Diamond, partner and founding partner and CEO of 362 00:19:28,240 --> 00:19:31,840 Speaker 1: Atlas Merchant Capital, of course, former CEO of Barkley's. Bob, 363 00:19:31,880 --> 00:19:35,280 Speaker 1: thanks so much for joining us in studio. UM, I 364 00:19:35,320 --> 00:19:38,080 Speaker 1: know you're here for the Bloomberg invest Conference. I just wonder, 365 00:19:38,240 --> 00:19:40,119 Speaker 1: you know, just given what we heard from President Trump 366 00:19:40,200 --> 00:19:43,400 Speaker 1: and Teresa May, one of the topics obviously is Brexit. 367 00:19:44,119 --> 00:19:46,840 Speaker 1: Given your experience in the UK with Barkley's and so on, 368 00:19:46,920 --> 00:19:49,560 Speaker 1: how do you think this is going to play out 369 00:19:49,920 --> 00:19:53,360 Speaker 1: in your opinion? You know, it's the question of the day, 370 00:19:53,400 --> 00:19:56,359 Speaker 1: and I think we're not going to know until leadership 371 00:19:56,440 --> 00:19:58,960 Speaker 1: is is settled, which we've been talking about in the 372 00:19:59,040 --> 00:20:03,440 Speaker 1: Conservative Party. It's going to take leadership to deliver this. Um. 373 00:20:03,480 --> 00:20:06,480 Speaker 1: You know my starting position as it was a bad decision, 374 00:20:06,800 --> 00:20:08,680 Speaker 1: but I think it is what it is, and now 375 00:20:08,720 --> 00:20:12,520 Speaker 1: it's about implementation and execution and moving forward and certainty. 376 00:20:13,480 --> 00:20:15,720 Speaker 1: And I think the business community, in particular in the 377 00:20:15,760 --> 00:20:19,480 Speaker 1: financial services industry needs certainty. So I think the next 378 00:20:19,560 --> 00:20:21,680 Speaker 1: leader has to be someone that we can be confident 379 00:20:21,800 --> 00:20:26,199 Speaker 1: can deliver and execute. Is it your sense, given you 380 00:20:26,240 --> 00:20:29,919 Speaker 1: know your understanding of a British corporate Um, you know, 381 00:20:30,000 --> 00:20:31,800 Speaker 1: politics and what's going on. Is it your sense that 382 00:20:32,280 --> 00:20:35,879 Speaker 1: corporations in the UK have done what they can to 383 00:20:35,920 --> 00:20:40,000 Speaker 1: prepare for what might be a less than clean Brexit. Yeah, 384 00:20:40,000 --> 00:20:41,600 Speaker 1: I would say a couple of things, Paul. It's a 385 00:20:41,680 --> 00:20:44,320 Speaker 1: it's a good point. And through Panmore Gordon, which is 386 00:20:44,359 --> 00:20:48,520 Speaker 1: the middle market broker dealer that we're we're an owner 387 00:20:48,600 --> 00:20:52,120 Speaker 1: of in the UK, we talked to small businesses every 388 00:20:52,200 --> 00:20:56,680 Speaker 1: day and they have moved on so they fully expect Brexit. 389 00:20:57,160 --> 00:20:59,600 Speaker 1: I think they're to your point as prepared as they 390 00:20:59,600 --> 00:21:02,199 Speaker 1: can be right now. And I think if you asked 391 00:21:02,400 --> 00:21:05,479 Speaker 1: the chief executives, they'd say, to a person, we just 392 00:21:05,560 --> 00:21:07,880 Speaker 1: want certainty and we want to move forward. I think 393 00:21:08,280 --> 00:21:10,720 Speaker 1: the kinds of things they were hearing today about the 394 00:21:10,760 --> 00:21:15,920 Speaker 1: potential for trade agreements with the US and UK will 395 00:21:15,920 --> 00:21:18,680 Speaker 1: be will be taken very very positively. But it's certainty 396 00:21:18,800 --> 00:21:21,720 Speaker 1: more than anything else that they need now. Bob Diamond, 397 00:21:21,720 --> 00:21:24,040 Speaker 1: Tom keenan London and we say good morning here from 398 00:21:24,040 --> 00:21:27,080 Speaker 1: the reign of London Light Rain, I should say beautiful. 399 00:21:27,920 --> 00:21:31,280 Speaker 1: As the President moves on with his day. You have 400 00:21:31,560 --> 00:21:35,679 Speaker 1: an uncommonly direct relationship with Boris Johnson, going back to 401 00:21:35,720 --> 00:21:38,919 Speaker 1: his time as mayor, with your leadership with Barclays and 402 00:21:39,000 --> 00:21:43,760 Speaker 1: for all of our listeners worldwide identified with Premier League sponsorship, 403 00:21:43,840 --> 00:21:47,440 Speaker 1: but particularly those bikes pedaling around And I can I'll 404 00:21:47,440 --> 00:21:51,879 Speaker 1: say right now, folks without editorializing that Bob Diamond's leadership 405 00:21:52,359 --> 00:21:55,960 Speaker 1: and getting bikes around cities, maybe it was your most 406 00:21:56,280 --> 00:21:59,520 Speaker 1: it was your most profound effect. Bob tell us about 407 00:21:59,520 --> 00:22:03,320 Speaker 1: the border Johnson, you know, and can he get along 408 00:22:03,359 --> 00:22:08,240 Speaker 1: with multinational business in London. So I as you say, Tom, 409 00:22:08,280 --> 00:22:11,199 Speaker 1: I've known Boris for over twenty years. I think he 410 00:22:11,280 --> 00:22:14,600 Speaker 1: was an absolutely terrific mayor. I think London, why is 411 00:22:14,640 --> 00:22:17,600 Speaker 1: he a lightning rod of criticism? I think I think 412 00:22:17,640 --> 00:22:21,199 Speaker 1: many great leaders can be can be lightning rods. I 413 00:22:21,200 --> 00:22:25,120 Speaker 1: think this whole process of Brexit, um, I think everyone 414 00:22:25,840 --> 00:22:29,440 Speaker 1: has come out, you know, around an issue that divided 415 00:22:29,480 --> 00:22:32,360 Speaker 1: the country this much. Of course there's going to be 416 00:22:32,760 --> 00:22:35,920 Speaker 1: some light lightning rod impact. But you know, I even 417 00:22:35,960 --> 00:22:38,760 Speaker 1: worked on the Mayor's Fund for London. When Boris set 418 00:22:38,840 --> 00:22:42,160 Speaker 1: up a fund for London, it was to ensure that 419 00:22:42,320 --> 00:22:46,320 Speaker 1: young children um had a good introduction to school and 420 00:22:46,359 --> 00:22:49,120 Speaker 1: that meant everything from making sure they had meals when 421 00:22:49,119 --> 00:22:51,960 Speaker 1: they got to school to making sure that the teachers 422 00:22:51,960 --> 00:22:55,080 Speaker 1: were prepared, and it was a recognition. He never talked 423 00:22:55,119 --> 00:22:57,119 Speaker 1: about it, he never got credit for it, but it 424 00:22:57,160 --> 00:23:01,080 Speaker 1: was a recognition that the importance for London of the 425 00:23:01,240 --> 00:23:04,359 Speaker 1: younger generation, young kids getting a good start in school. 426 00:23:04,760 --> 00:23:06,679 Speaker 1: But I think what he brings, what he brought to 427 00:23:06,720 --> 00:23:10,399 Speaker 1: London was he's really really smart. He's a really really 428 00:23:10,440 --> 00:23:14,119 Speaker 1: strong leader. He's very very strategic, and he's willing to 429 00:23:14,160 --> 00:23:17,520 Speaker 1: make bold decisions. And I think, um, you know, right now, 430 00:23:17,600 --> 00:23:21,720 Speaker 1: when we're looking at execution, execution, execution being critical, we 431 00:23:21,800 --> 00:23:24,080 Speaker 1: know the direction that we're going on Brexit, it's all 432 00:23:24,119 --> 00:23:27,160 Speaker 1: about execution. That's the kind of leadership that we need. 433 00:23:28,119 --> 00:23:31,760 Speaker 1: How would Prime Minister Johnson be different from President Trump. 434 00:23:31,800 --> 00:23:34,280 Speaker 1: I mean they've got the same blonde hair. There's a 435 00:23:34,320 --> 00:23:36,399 Speaker 1: story about that may able to get the Bob Diamond 436 00:23:36,440 --> 00:23:39,639 Speaker 1: look going. But but how is Mr Johnson different from 437 00:23:39,760 --> 00:23:42,920 Speaker 1: Mr Trump? Yeah, I don't think there's any similarities really. 438 00:23:42,960 --> 00:23:45,600 Speaker 1: I guess the fluffy hair might be. But you have 439 00:23:45,680 --> 00:23:48,239 Speaker 1: to go back over over the time that that the 440 00:23:48,280 --> 00:23:51,359 Speaker 1: Boris has had real impact and I look at the 441 00:23:51,400 --> 00:23:54,399 Speaker 1: London of today. One of the reasons that you know 442 00:23:54,480 --> 00:23:57,200 Speaker 1: that city has weathered all the if I can call 443 00:23:57,240 --> 00:24:01,479 Speaker 1: it the kerfuffle of Brexit, not Brexit, maybe Broxit sometimes Brexit. 444 00:24:01,560 --> 00:24:05,200 Speaker 1: Where is everyone going? London is still the key financial 445 00:24:05,200 --> 00:24:07,679 Speaker 1: center in the world. I'm glad you brought that up 446 00:24:07,680 --> 00:24:09,840 Speaker 1: because I think a lot of concern, Bob is that 447 00:24:10,920 --> 00:24:13,920 Speaker 1: with the uncertainty of Brexit, that London would lose its 448 00:24:14,000 --> 00:24:17,679 Speaker 1: position as a global financial marketplace. And I guess we 449 00:24:17,840 --> 00:24:21,639 Speaker 1: really haven't seen it today. We've seen certain jobs moved 450 00:24:21,840 --> 00:24:24,560 Speaker 1: to Frankfurt to other parts of Europe. Do you expect 451 00:24:24,600 --> 00:24:28,240 Speaker 1: that to accelerate if we have maybe a messy Brexit deal. Yeah. 452 00:24:28,320 --> 00:24:30,040 Speaker 1: I think there's two ways to look at it. One, 453 00:24:30,600 --> 00:24:33,720 Speaker 1: for the next decade or a hundred years, London will 454 00:24:33,720 --> 00:24:36,000 Speaker 1: be one of their key financial centers in the world 455 00:24:36,040 --> 00:24:38,120 Speaker 1: and will be a place where people want to live. 456 00:24:38,280 --> 00:24:42,040 Speaker 1: Great schools, great environment, great culture. But most importantly it 457 00:24:42,040 --> 00:24:45,200 Speaker 1: will be one of our key financial centers. There are 458 00:24:45,320 --> 00:24:48,920 Speaker 1: jobs moving to Dublin, to Amsterdam, to Frankfort, but Paul 459 00:24:48,960 --> 00:24:51,639 Speaker 1: I would say this is something that that these capitals 460 00:24:51,680 --> 00:24:54,600 Speaker 1: have been looking for since the introduction of the single currency. 461 00:24:54,840 --> 00:24:57,359 Speaker 1: There's always been why is everything in London that's right? 462 00:24:57,400 --> 00:24:59,680 Speaker 1: So everyone wants to get their piece of the business. 463 00:24:59,800 --> 00:25:01,879 Speaker 1: The was a little bit of a crack to allow 464 00:25:02,000 --> 00:25:04,040 Speaker 1: some of that to happen. But I think some of 465 00:25:04,080 --> 00:25:07,720 Speaker 1: it is a natural evolution. Is the asset management industry, 466 00:25:08,200 --> 00:25:11,119 Speaker 1: you know, managing pension money and Frankfort always going to 467 00:25:11,160 --> 00:25:12,960 Speaker 1: be in London. No, They're going to always try and 468 00:25:13,000 --> 00:25:15,280 Speaker 1: pull more of it back, the same way Chicago wants 469 00:25:15,320 --> 00:25:17,680 Speaker 1: to pull business from New York. So some of this 470 00:25:17,760 --> 00:25:19,800 Speaker 1: is natural. It got a little bit of an impetus. 471 00:25:20,200 --> 00:25:23,160 Speaker 1: I think a lot of the services, legal services, accounting 472 00:25:23,200 --> 00:25:25,800 Speaker 1: services will be spread out a little bit more, and 473 00:25:25,840 --> 00:25:28,040 Speaker 1: so there will be an impact on London, but not 474 00:25:28,119 --> 00:25:31,040 Speaker 1: an impact that's going to remove it as the as 475 00:25:31,119 --> 00:25:34,120 Speaker 1: the premier financial center in the world. Both. I guess 476 00:25:34,119 --> 00:25:36,880 Speaker 1: at the press conference today about both the President Trump 477 00:25:36,920 --> 00:25:40,480 Speaker 1: and Prime Minister May talking about a UK US trade 478 00:25:40,480 --> 00:25:43,280 Speaker 1: deal and how it could be potentially President Trump shorts 479 00:25:43,280 --> 00:25:46,119 Speaker 1: significantly bigger than the current trade agreement. How do you 480 00:25:46,119 --> 00:25:49,640 Speaker 1: think that might develop? Well, I think I think both 481 00:25:49,720 --> 00:25:52,159 Speaker 1: for the US and the UK right now, having the 482 00:25:52,280 --> 00:25:57,159 Speaker 1: positive momentum of a substantive real trade deal between the 483 00:25:57,200 --> 00:25:58,880 Speaker 1: US and UK would be great. I think it would 484 00:25:58,880 --> 00:26:02,000 Speaker 1: be terrific for both countries. Um. You know the history 485 00:26:02,080 --> 00:26:05,520 Speaker 1: of this relationship goes way back thirty years ago when 486 00:26:05,560 --> 00:26:08,439 Speaker 1: I moved to London with Morgan Stanley. UM, I was 487 00:26:08,520 --> 00:26:11,080 Speaker 1: there for Big Bang. I was there to see the 488 00:26:11,160 --> 00:26:16,440 Speaker 1: impact that the US financial services industry, Morgan Stanley, Goldman, Sachs, 489 00:26:16,440 --> 00:26:20,240 Speaker 1: Solomon Brothers. You know, the beginning of their really international 490 00:26:20,240 --> 00:26:23,640 Speaker 1: expansion was to London. The growth of the financial markets, 491 00:26:23,680 --> 00:26:26,959 Speaker 1: the incredible capital markets that we take for granted today. 492 00:26:27,560 --> 00:26:29,520 Speaker 1: So much of this as a result of the UK 493 00:26:29,960 --> 00:26:33,040 Speaker 1: US special relationship. I don't think we can underestimate it. 494 00:26:33,600 --> 00:26:35,520 Speaker 1: We are thrilled to Bob Diamonds with us, of course, 495 00:26:35,520 --> 00:26:38,200 Speaker 1: the former leader of Barclays. He's got all sorts adventurous 496 00:26:38,240 --> 00:26:42,040 Speaker 1: moving on now, including speaking in Bloomberg today. Bob Diamond 497 00:26:42,040 --> 00:26:44,879 Speaker 1: will continue with us. He is with Paul Sweeney in 498 00:26:44,920 --> 00:26:48,280 Speaker 1: our Bloomberg Interactive Broker studios in New York. I'm Tom Keane, 499 00:26:48,840 --> 00:26:51,200 Speaker 1: the Queen Victoria Street, Paul, I should point out, with 500 00:26:51,320 --> 00:26:55,920 Speaker 1: better coffee than you have. The coffee here is extraordinary. 501 00:26:56,040 --> 00:26:59,359 Speaker 1: We've got the absolute most spectacular building in our newest 502 00:26:59,400 --> 00:27:02,520 Speaker 1: building at Edition in London. It is it's really something 503 00:27:02,560 --> 00:27:05,040 Speaker 1: here in a course with Roman Roumans down in the basement, 504 00:27:05,160 --> 00:27:07,960 Speaker 1: Bob Diamond, I think he held a Colby fundraiser in 505 00:27:08,000 --> 00:27:10,920 Speaker 1: the Roman ruins. Uh, you know, a couple hundred years 506 00:27:10,920 --> 00:27:13,960 Speaker 1: ago as well. But it is indeed historic here and 507 00:27:14,320 --> 00:27:17,520 Speaker 1: an historic moment as Prime minister may really possibly her 508 00:27:17,640 --> 00:27:23,159 Speaker 1: last appearance before she loses leadership of the Conservative Party 509 00:27:23,160 --> 00:27:27,359 Speaker 1: and then towards a new prime minister avoiding a general 510 00:27:27,359 --> 00:27:31,440 Speaker 1: election with President Trump the Doalop two d and thirty 511 00:27:31,520 --> 00:27:35,280 Speaker 1: nine points. As we speak with Bob Diamond. Uh, Bob, 512 00:27:35,320 --> 00:27:38,720 Speaker 1: it is a special relationship as well, and yet we 513 00:27:38,800 --> 00:27:41,720 Speaker 1: go to a trade deal without question. The British press 514 00:27:41,720 --> 00:27:45,919 Speaker 1: this morning talks about the aggressiveness of President Trump in 515 00:27:45,960 --> 00:27:50,560 Speaker 1: a mercantile non lateral negotiations. What kind of trade deal 516 00:27:50,640 --> 00:27:56,399 Speaker 1: could be negotiated in a post Rexit world. Um, you 517 00:27:56,440 --> 00:27:59,720 Speaker 1: know you're you're well beyond my area of expertise, but 518 00:27:59,800 --> 00:28:04,520 Speaker 1: I thinking about this just from the UK position right now. Um, 519 00:28:04,600 --> 00:28:09,120 Speaker 1: as they moved towards exiting Brexit, there's probably nothing more 520 00:28:09,119 --> 00:28:14,160 Speaker 1: important on the economic agenda than than to ensure um 521 00:28:14,200 --> 00:28:18,840 Speaker 1: trading relationships and UM the documentation of that with their 522 00:28:18,920 --> 00:28:22,040 Speaker 1: key trading partners. We've talked about this before, Tom, but 523 00:28:22,880 --> 00:28:25,600 Speaker 1: both when I was at Barclays and now in Atlas 524 00:28:25,600 --> 00:28:28,280 Speaker 1: Merchant Capital with Panmore Gordon. I've spent a lot of 525 00:28:28,320 --> 00:28:31,800 Speaker 1: time in towns like Leeds and Birmingham and Manchester with 526 00:28:31,920 --> 00:28:35,520 Speaker 1: small businesses and it surprised me early on. It will 527 00:28:35,560 --> 00:28:38,960 Speaker 1: never surprise me again. Every single business, no matter how 528 00:28:39,000 --> 00:28:44,680 Speaker 1: small warehouses to to chocolate makers, to to raising to 529 00:28:44,680 --> 00:28:48,760 Speaker 1: to razor manufacturers, all have trade with Europe and almost 530 00:28:48,840 --> 00:28:51,000 Speaker 1: all of them have trade with the US as well. 531 00:28:51,080 --> 00:28:54,040 Speaker 1: This is a trading nation and so I think the 532 00:28:54,160 --> 00:28:59,000 Speaker 1: shock of the uncertainty of Brexit is most profound with 533 00:28:59,040 --> 00:29:01,800 Speaker 1: the small businesses across the UK, and the benefit will 534 00:29:01,800 --> 00:29:04,440 Speaker 1: be most profound if we get certainty and we get 535 00:29:04,480 --> 00:29:06,240 Speaker 1: we get some good trade agreements. Well, I don't go 536 00:29:06,480 --> 00:29:09,200 Speaker 1: all David Ricardo on you, but I will so. Do 537 00:29:09,320 --> 00:29:15,320 Speaker 1: you assume that a post Brexit United Kingdom can overlay 538 00:29:15,480 --> 00:29:20,160 Speaker 1: a burgeoning US UK relationship on top of the existing 539 00:29:20,360 --> 00:29:26,240 Speaker 1: volume of EU trade or does its substitute. I don't 540 00:29:26,240 --> 00:29:29,200 Speaker 1: think it will replace by any means. I think the 541 00:29:29,360 --> 00:29:32,080 Speaker 1: trade with Europe is critical for the UK. I haven't 542 00:29:32,080 --> 00:29:35,200 Speaker 1: got the numbers to hand but I know trade with 543 00:29:35,280 --> 00:29:38,719 Speaker 1: Europe is is significantly greater than trade with the US 544 00:29:39,440 --> 00:29:44,240 Speaker 1: for businesses in the UK. I was not in favor 545 00:29:44,280 --> 00:29:47,040 Speaker 1: of Brexit for for just these reasons. But we've moved 546 00:29:47,040 --> 00:29:49,640 Speaker 1: beyond that. It's now into execution and we have to 547 00:29:49,680 --> 00:29:52,400 Speaker 1: execute it in a way that the trade relationships between 548 00:29:52,400 --> 00:29:56,520 Speaker 1: the UK corporates and UH and Europe stays as strong 549 00:29:56,560 --> 00:29:58,920 Speaker 1: as it can. So about one of the issues I 550 00:29:58,960 --> 00:30:01,840 Speaker 1: know for global financial institutions is kind of just the 551 00:30:01,880 --> 00:30:04,600 Speaker 1: European market in general, the strength of the European economy. 552 00:30:04,600 --> 00:30:07,840 Speaker 1: One of the big issues I guess from your part 553 00:30:07,840 --> 00:30:09,480 Speaker 1: of the world of financial services part of world is 554 00:30:09,520 --> 00:30:12,440 Speaker 1: Deutsche Bank. Where do you what do you think happens 555 00:30:12,480 --> 00:30:17,239 Speaker 1: to Deutsche Bank specifically banking in Germany in general. So 556 00:30:17,280 --> 00:30:20,200 Speaker 1: I think banking in Germany is it a very interesting 557 00:30:20,200 --> 00:30:25,600 Speaker 1: crossroad right now? They have two very large, very um 558 00:30:25,840 --> 00:30:29,800 Speaker 1: low profit in both Commerce Bank and Deutsche Bank. UM, 559 00:30:30,000 --> 00:30:33,400 Speaker 1: so they have two very large institutions. They're not performing well. 560 00:30:33,600 --> 00:30:36,960 Speaker 1: They're clearly in play. As we've watched the Deutsche Commerce 561 00:30:37,000 --> 00:30:42,000 Speaker 1: Bank discussions go forward officially and then end. You can 562 00:30:42,040 --> 00:30:44,640 Speaker 1: read as well as I can that Una Credito from 563 00:30:44,760 --> 00:30:47,440 Speaker 1: from Italy they have a they have a very very 564 00:30:47,480 --> 00:30:51,520 Speaker 1: strong CEO, and JP Mustier are looking at Commerce Bank, 565 00:30:51,560 --> 00:30:55,120 Speaker 1: and so if you asked me a transaction like that 566 00:30:55,160 --> 00:30:58,120 Speaker 1: would be very very positive. I think Germany has an 567 00:30:58,120 --> 00:31:00,240 Speaker 1: issue and they need a resolution to at LEAs East 568 00:31:00,280 --> 00:31:04,320 Speaker 1: one of Deutsche Bank or Commerce Bank. And over you 569 00:31:04,360 --> 00:31:06,600 Speaker 1: didn't quite ask this, Paul, so I'm kind of adding 570 00:31:06,600 --> 00:31:10,080 Speaker 1: a second thing, so I think it relates. But Um, 571 00:31:10,120 --> 00:31:12,400 Speaker 1: over all of this is the fact that we have 572 00:31:12,760 --> 00:31:19,200 Speaker 1: a new ECB governor coming and I think Europe needs, um, 573 00:31:19,440 --> 00:31:22,520 Speaker 1: a very very strong governor of the e c B, 574 00:31:23,240 --> 00:31:28,200 Speaker 1: someone more like Mario drag who made that incredibly important 575 00:31:28,200 --> 00:31:30,880 Speaker 1: comment in two thousand twelve that he'll do whatever it 576 00:31:31,040 --> 00:31:35,160 Speaker 1: is necessary in the interests of the Eurozone. And what 577 00:31:35,240 --> 00:31:40,840 Speaker 1: Europe does not need is another hard line bundas Bank orthodoxy, 578 00:31:41,120 --> 00:31:45,840 Speaker 1: orthodoxy driven one variable um kind of approach. We need 579 00:31:45,920 --> 00:31:50,120 Speaker 1: bunch more flexibility towards towards monetary policy in Europe. And 580 00:31:50,160 --> 00:31:54,960 Speaker 1: I think who succeeds Mario d is a critically important factor. Well, 581 00:31:55,120 --> 00:31:57,400 Speaker 1: one of the things Tom and I've talked about, you know, 582 00:31:57,520 --> 00:32:00,720 Speaker 1: continually on this show is it seems like after the 583 00:32:00,760 --> 00:32:05,200 Speaker 1: financial crisis, the US banking industry cleared, for lack of 584 00:32:05,200 --> 00:32:09,680 Speaker 1: a better word, consolidated, rationalized. Yet Europe does not seem 585 00:32:09,760 --> 00:32:13,640 Speaker 1: to have done that. Ergo, the banks are not as strong, 586 00:32:13,680 --> 00:32:16,600 Speaker 1: we have negative interest rates not helping in certain major markets. 587 00:32:16,640 --> 00:32:19,040 Speaker 1: Do you believe that there needs to be a clearing 588 00:32:19,120 --> 00:32:23,840 Speaker 1: or a consolidation of European banking broadly? Absolutely, and it's 589 00:32:23,840 --> 00:32:26,080 Speaker 1: gonna it's gonna take a while. But if we go back, 590 00:32:26,160 --> 00:32:29,600 Speaker 1: and I've spoken at length with Tom about this, not 591 00:32:29,720 --> 00:32:33,040 Speaker 1: with you, Paul, but the Tart program was brilliant, you know. 592 00:32:33,080 --> 00:32:36,480 Speaker 1: It basically put more equity than any bank needed in 593 00:32:36,560 --> 00:32:41,560 Speaker 1: all of the systemic banks. The trick was number one, 594 00:32:42,000 --> 00:32:44,720 Speaker 1: you can't pay that capital back until you pass the 595 00:32:44,720 --> 00:32:47,600 Speaker 1: stress test, which means you've cleaned up your balance sheet. 596 00:32:48,280 --> 00:32:50,720 Speaker 1: And until you pay it back, you can't pay bonuses 597 00:32:50,760 --> 00:32:54,000 Speaker 1: and you can't pay dividends. So the US banks repaired quickly. 598 00:32:54,520 --> 00:32:57,040 Speaker 1: Is there a program like that that could be implemented 599 00:32:57,080 --> 00:32:59,560 Speaker 1: across Europe? I think if there was a will in 600 00:32:59,600 --> 00:33:02,080 Speaker 1: a way, it would have been done. And so I 601 00:33:02,120 --> 00:33:05,080 Speaker 1: think a lot more of the pressure is on each 602 00:33:05,160 --> 00:33:08,880 Speaker 1: of the each of the nation. So in Greece, for example, 603 00:33:09,560 --> 00:33:13,080 Speaker 1: they did consolidate. They had twenty five banks and two thousand, 604 00:33:13,360 --> 00:33:16,520 Speaker 1: two thousand nine. Today there's four major banks, which is 605 00:33:16,560 --> 00:33:21,880 Speaker 1: the consolidation of those, but they average over non performing 606 00:33:21,960 --> 00:33:25,160 Speaker 1: loans today ten years on. And that's the situation with 607 00:33:25,280 --> 00:33:28,160 Speaker 1: Deutsche Bank and Commerce Bank. They never addressed the balance 608 00:33:28,160 --> 00:33:30,360 Speaker 1: shooter shoes. Well, let's go right to that, Bob Diamond, 609 00:33:30,360 --> 00:33:32,600 Speaker 1: about time for one more question. We're waiting for Chairman 610 00:33:32,680 --> 00:33:36,200 Speaker 1: Powell to speak an important speech in Chicago. We'll have 611 00:33:36,280 --> 00:33:38,880 Speaker 1: that for you on Bloomberg Radio. Bob Diamond, I think 612 00:33:38,880 --> 00:33:41,400 Speaker 1: the last time you and I talked, the red sox 613 00:33:41,640 --> 00:33:44,960 Speaker 1: uh we're playing I don't know, above below five ball. 614 00:33:45,120 --> 00:33:47,760 Speaker 1: Now they're doing a little better. And also Deutsche Bank 615 00:33:47,840 --> 00:33:50,400 Speaker 1: was at seven euros per share. We had a five 616 00:33:50,480 --> 00:33:54,320 Speaker 1: handle the other day. The vector is not good. What 617 00:33:54,480 --> 00:33:59,280 Speaker 1: occurs does the German government step in? I mean, each 618 00:33:59,360 --> 00:34:02,640 Speaker 1: nation has your own ballet. How do you see a 619 00:34:02,800 --> 00:34:06,320 Speaker 1: Deutsche Bank workout? So that's you're getting to the nub 620 00:34:06,400 --> 00:34:09,560 Speaker 1: of the issue is I think the Commerce Deutsche combination 621 00:34:10,440 --> 00:34:14,160 Speaker 1: allowed something that that that because the government had an 622 00:34:14,200 --> 00:34:16,880 Speaker 1: ownership in Commerce Bank, that could kind of get away 623 00:34:16,920 --> 00:34:20,239 Speaker 1: by being involved in that. In that merger. But no 624 00:34:20,400 --> 00:34:24,799 Speaker 1: elected official or no regulator wants to be associated with 625 00:34:24,840 --> 00:34:27,520 Speaker 1: too big to fail or bailing out a bank. And 626 00:34:27,680 --> 00:34:31,080 Speaker 1: that's why SIPHI and g SphI and buffer upon buffer 627 00:34:31,120 --> 00:34:35,200 Speaker 1: of capital. It's created massive opportunities for US Anatlas merchant capital. 628 00:34:35,280 --> 00:34:37,200 Speaker 1: So we kind of love it. But that's not the 629 00:34:37,280 --> 00:34:40,480 Speaker 1: question you're asking. You're asking what's the resolution of Deutsche Bank? 630 00:34:40,560 --> 00:34:43,160 Speaker 1: And I think it's really challenging, and it puts it 631 00:34:43,200 --> 00:34:47,160 Speaker 1: puts the elected officials in Germany in an enormously challenging 632 00:34:47,200 --> 00:34:49,520 Speaker 1: position if they have to bail it out. But if 633 00:34:49,560 --> 00:34:52,360 Speaker 1: I can be quite direct, they kind of are already. 634 00:34:52,640 --> 00:34:57,240 Speaker 1: You know, the markets have the underpinning that the German 635 00:34:57,280 --> 00:34:59,880 Speaker 1: government would step in if necessary. And this is the 636 00:35:00,040 --> 00:35:03,000 Speaker 1: exactly what the regulators and elected officials hated in two 637 00:35:03,000 --> 00:35:05,439 Speaker 1: thousand and eight and two thousand nine was too big 638 00:35:05,480 --> 00:35:08,480 Speaker 1: to fail, And here it is again. Bob Diamond, thank 639 00:35:08,480 --> 00:35:11,160 Speaker 1: you so much, just generous of your time. You're today 640 00:35:11,280 --> 00:35:14,880 Speaker 1: Mr Diamond of course with Barclays and he's moved on 641 00:35:14,960 --> 00:35:20,520 Speaker 1: to other investment action here in two thousand nineteen. Thanks 642 00:35:20,520 --> 00:35:24,800 Speaker 1: for listening to the Bloomberg Surveillance podcast. Subscribe and listen 643 00:35:25,000 --> 00:35:30,320 Speaker 1: to interviews on Apple Podcasts, SoundCloud, or whichever podcast platform 644 00:35:30,440 --> 00:35:34,759 Speaker 1: you prefer. I'm on Twitter at Tom Keane before the podcast. 645 00:35:34,800 --> 00:35:38,320 Speaker 1: You can always catch us worldwide. I'm Bloomberg Radio