WEBVTT - Trump Interview, Tesla Hiring, U.S Bank Earnings 0:00:02.920 --> 0:00:08.240 Bloomberg Audio Studios, podcasts, radio news. 0:00:10.560 --> 0:00:14.360 This is Bloomberg Intelligence with Alex Steinhl and Paul Sweeny. 0:00:14.520 --> 0:00:17.720 The real app performance has been in US corporate high yield. 0:00:17.880 --> 0:00:20.280 Are the companies lean enough? Have they trimmed all the fats? 0:00:20.320 --> 0:00:23.480 The semiconductor business is a really cyclical. 0:00:23.079 --> 0:00:27.200 Business, breaking market headlines and corporate news from across the globe. 0:00:27.240 --> 0:00:29.880 Do investors like the M and A that we've seen? 0:00:30.080 --> 0:00:33.159 These are two big time blue chip companies. 0:00:33.320 --> 0:00:36.920 The window between the peak and cut changing super fast. 0:00:37.080 --> 0:00:41.680 Bloomberg Intelligence with Alex Steinhl and Paul'sweeny on Bloomberg Radio. 0:00:43.600 --> 0:00:46.200 On Today's Bloomberg Intelligence Show, we dig inside the big 0:00:46.240 --> 0:00:48.960 business stories in pacting Wall Street and the global markets. 0:00:49.000 --> 0:00:51.320 Each and every week we provide in depth research and 0:00:51.440 --> 0:00:53.320 data on some of the two thousand companies and one 0:00:53.400 --> 0:00:56.720 hundred and thirty industries our analysts cover worldwide. Today, we'll 0:00:56.760 --> 0:00:59.160 look at why Tesla is looking to hire nearly eight 0:00:59.200 --> 0:01:02.680 hundred new employer after its largest round of layoffs. Plus 0:01:02.680 --> 0:01:06.000 we'll discuss why United Airlines gave disappointing guidance for the 0:01:06.040 --> 0:01:08.760 third quarter. But first we look at quarterly earnings from 0:01:08.800 --> 0:01:12.720 the world's largest money manager Blackrock. Blackrock called in fifty 0:01:12.800 --> 0:01:16.000 one billion dollars of client cash to its long term 0:01:16.040 --> 0:01:18.319 investment funds in the second quarter. As a result, the 0:01:18.360 --> 0:01:20.320 firm hit a record of ten point six trillion dollars 0:01:20.360 --> 0:01:22.800 of assets. For more, we were joined by Neil Sipes, 0:01:22.800 --> 0:01:26.400 Bloomberg Intelligence financials analyst. We first asked Neil to comment 0:01:26.560 --> 0:01:27.520 on this week's news. 0:01:27.840 --> 0:01:30.480 I think obviously over the past eighteen months, banks have 0:01:30.560 --> 0:01:32.920 been much more in the focus asset managers, maybe a 0:01:32.959 --> 0:01:35.600 little bit of a sleepier name, so to speak. But 0:01:35.720 --> 0:01:38.560 like you said, Blackrock eclipsing ten and a half trillion. 0:01:38.920 --> 0:01:40.880 Of course, a lot of that is due to markets. 0:01:40.920 --> 0:01:43.360 We're up, you know, fifteen twenty percent year to date, 0:01:43.360 --> 0:01:46.680 but Blackrock sort of that perennial grower in the industry. 0:01:47.080 --> 0:01:50.840 Organic growth, those flows from institutional retail clients have been 0:01:50.880 --> 0:01:54.520 harder to come by. Blackrock, having that breadth and diversity 0:01:54.560 --> 0:01:57.560 of the platform, has really been able to deliver growth 0:01:57.840 --> 0:02:00.280 through varying market cycles. We think that's one of their 0:02:00.280 --> 0:02:02.640 strengths and why they're the leader in the space in 0:02:02.720 --> 0:02:05.760 terms of size. In terms of the second quarter organic 0:02:05.760 --> 0:02:09.360 growth a little bit lighter than expected. Part of that 0:02:09.520 --> 0:02:11.960 due to the fact that we saw some larger institutional 0:02:12.000 --> 0:02:15.720 clients sort of rebalancing portfolios. That's just sort of natural 0:02:15.760 --> 0:02:20.239 in the business, especially when you're at all time highs. Nonetheless, 0:02:20.280 --> 0:02:24.200 margin really improved again, that's on the heels of stronger markets. 0:02:24.280 --> 0:02:26.760 Most of the revenue here is asset based fees, so 0:02:27.200 --> 0:02:30.520 as markets move higher, the top line expands as well. 0:02:31.360 --> 0:02:33.640 And so really, you know, you highlighted the last thing. 0:02:33.680 --> 0:02:36.760 I guess ETF's another strong suit. That's really the bread 0:02:36.760 --> 0:02:39.799 and butter of black Rock again, and obviously now with 0:02:40.200 --> 0:02:42.800 some of that private's markets push that we've seen in 0:02:42.800 --> 0:02:44.400 the past couple months, when do. 0:02:44.360 --> 0:02:46.160 They hit the law of large numbers thing? 0:02:46.639 --> 0:02:49.800 Yeah, I think that is becoming the more popular question 0:02:49.880 --> 0:02:50.639 for me to ask. 0:02:50.520 --> 0:02:52.680 This question forever, right, and it is still do it? 0:02:52.840 --> 0:02:55.359 Yeah? They and they continue to target this five percent 0:02:55.480 --> 0:02:58.600 organic based feed growth figure. They've been lagging that over 0:02:58.639 --> 0:03:01.800 the past couple of quarters. Obvious markets, you know, since 0:03:01.840 --> 0:03:05.440 the beginning of twenty twenty two, we're less conducive. They've 0:03:05.440 --> 0:03:07.639 been more conducive for the past three quarters or so. 0:03:07.919 --> 0:03:10.160 But the question still remains, how do you continue to 0:03:10.200 --> 0:03:13.000 grow at that five percent clip when You're talking about 0:03:13.000 --> 0:03:16.520 a ten trillion dollar asset base, and we think BlackRock's 0:03:16.600 --> 0:03:19.720 diversity when assets are in motion, they can continue to 0:03:19.760 --> 0:03:24.320 garner share from less diversified, less price competitors. 0:03:24.600 --> 0:03:26.720 Stock hasn't done anything this year, kind of up one 0:03:26.760 --> 0:03:29.520 percent just on the year, lagging the market. What's the 0:03:29.560 --> 0:03:32.000 investment called here on Blackrow? What are the investors saying? 0:03:32.200 --> 0:03:35.000 Yeah? So I think, you know a lot of what's 0:03:35.040 --> 0:03:38.120 been baked into this year is sort of market growth, 0:03:38.160 --> 0:03:40.080 which is going to be a benefit to all asset 0:03:40.120 --> 0:03:43.200 managers in the space. So I think the skepticism of 0:03:43.360 --> 0:03:48.119 are these gains lasting? What happens obviously in November when 0:03:48.120 --> 0:03:51.680 we get this eventual FED pivot to cuts, How is 0:03:51.720 --> 0:03:54.240 that going to impact you know, client allocations, How is 0:03:54.280 --> 0:03:56.800 that going to impact the business model? But we do 0:03:56.840 --> 0:04:00.440 think Blackrock is, you know, a is position to benefit 0:04:00.520 --> 0:04:03.160 in pretty much all market cycles, and a lot of 0:04:03.200 --> 0:04:06.680 that long term story is now shifting into that private 0:04:06.720 --> 0:04:10.680 market's focus with Prequeent acquisition just announced a couple weeks 0:04:10.720 --> 0:04:13.120 ago and Global Infrastructure Partners in January. 0:04:13.640 --> 0:04:16.040 Ask a really dumb question at this point, who are 0:04:16.080 --> 0:04:19.719 Blackrocks actual competitors, Like, who can actually compete with this company. 0:04:19.920 --> 0:04:22.880 Yeah, so there are plenty of competitors. I mean, asset 0:04:22.880 --> 0:04:25.960 management can be somewhat commoditized in a lot of spaces. 0:04:26.560 --> 0:04:29.680 You know, there's competitors like a Vanguard. There's competitors like 0:04:30.040 --> 0:04:32.640 a Schwab, in Vesco, Franklin, Tira. Price, There's plenty of 0:04:32.760 --> 0:04:35.960 names out there. The question is who's able to compete 0:04:36.000 --> 0:04:38.680 on price with Blackrock? And that's where scale really becomes 0:04:38.680 --> 0:04:42.280 paramount here because they can continue to innovate with new products. 0:04:42.520 --> 0:04:45.680 If a new competitor comes out with, you know, a 0:04:45.720 --> 0:04:48.880 new flashy product, Blackrock tends to match that and can 0:04:48.920 --> 0:04:51.960 sometimes beat it on price. And we know that Blackrock 0:04:52.000 --> 0:04:56.080 is entrenched with pretty much every institutional client, every retail client, 0:04:56.160 --> 0:04:59.080 so to speak, and that really gives them the strength 0:04:59.120 --> 0:05:02.680 of distribution to kind of leverage across its platform. 0:05:03.000 --> 0:05:06.599 Our Thanks to Neil SIPs Bloomberg Intelligence financials Analysts, we 0:05:06.720 --> 0:05:09.159 now look at this week's Bloomberg Business Week cover story 0:05:09.279 --> 0:05:13.920 about former President Donald Trump. It's titled Trump on Taxes Tariffs. 0:05:14.040 --> 0:05:17.680 Jerome pal and Moore for the story, BusinessWeek recently sat 0:05:17.680 --> 0:05:19.839 down with the ex president at mar A Lago for 0:05:19.920 --> 0:05:22.960 an exclusive interview. They discussed Trump's plans for the US 0:05:23.000 --> 0:05:25.680 economy and the world if he were to be re 0:05:25.760 --> 0:05:28.039 elected as president. For more and all this, we were 0:05:28.080 --> 0:05:31.080 joined by Bloomberg Business Week editor Brad Stone. We first 0:05:31.120 --> 0:05:33.800 asked Brad just how hard it was to gather details 0:05:33.960 --> 0:05:34.640 for this story. 0:05:34.920 --> 0:05:38.080 Well, I mean, look, he wanted to talk. We'd actually 0:05:38.120 --> 0:05:41.599 put queries out to both campaigns. We heard first from 0:05:41.960 --> 0:05:45.080 former President Trump. You know, this is BusinessWeek, so our 0:05:45.120 --> 0:05:49.280 mandate is business obviously, economics the world order, and we 0:05:49.320 --> 0:05:52.520 went there to interrogate him about an economic plan that 0:05:52.640 --> 0:05:56.440 many economists think is a bit contradictory. I mean, President 0:05:56.520 --> 0:05:58.880 Trump talks about lowering inflation. 0:05:59.680 --> 0:06:01.080 The agenda is. 0:06:01.800 --> 0:06:07.440 Higher tariffs, less immigration, you know, which potentially raises wages. 0:06:08.120 --> 0:06:10.800 He talks a lot about lowering interest rates and then 0:06:10.839 --> 0:06:13.719 bringing members of the business community into his administration. So 0:06:14.000 --> 0:06:16.240 this is a topic he wanted to talk about. To 0:06:16.279 --> 0:06:18.799 put it in context, we talked to him two days 0:06:18.800 --> 0:06:21.799 before the first presidential debate and about two weeks before 0:06:21.839 --> 0:06:24.760 the assassination attempt. But even then, I think, you know, 0:06:24.839 --> 0:06:27.640 he is writing what he believes, at least in his campaign, 0:06:27.720 --> 0:06:30.000 believes is a heightened sense of momentum. 0:06:30.160 --> 0:06:32.479 So, Brad, there's a lot of areas here in the 0:06:32.640 --> 0:06:35.080 terms of economics to explore. Talk about taxes. How does 0:06:35.120 --> 0:06:37.600 he feel about taxes these days? He certainly had some 0:06:37.720 --> 0:06:40.160 big tax legislation in his first term, that's right. 0:06:40.240 --> 0:06:43.520 And one part of his plan is to extend the 0:06:43.560 --> 0:06:47.080 Trump tax cuts. Another part, which he told us, was 0:06:47.120 --> 0:06:49.679 to lower the corporate tax rate. He told the Business 0:06:49.720 --> 0:06:51.640 Roundtable that he wanted to bring it down to twenty 0:06:51.680 --> 0:06:54.479 percent from twenty one percent for no other reason that 0:06:54.520 --> 0:06:58.320 he likes big, large numbers. But then he said he 0:06:58.320 --> 0:07:00.679 would even get it down to fifteen percent if he could. 0:07:01.200 --> 0:07:03.680 You know, the challenge here, of course, is they don't 0:07:03.920 --> 0:07:06.120 delineate any way to pay for this, to make the 0:07:06.200 --> 0:07:08.560 numbers parcel out and do anything other than raise the 0:07:08.600 --> 0:07:11.760 federal deficit. And there is really, I think a paucity 0:07:11.840 --> 0:07:15.320 of specifics here, which is one reason why proxies have 0:07:15.440 --> 0:07:18.080 kind of tried to fill the void with things like 0:07:18.120 --> 0:07:22.200 Project twenty twenty five, which then Trump really distanced himself from. 0:07:22.560 --> 0:07:25.000 But you know, I think, you know, with the broad 0:07:25.040 --> 0:07:28.120 brushstrokes we got is Trump wants to lower taxes and 0:07:28.360 --> 0:07:29.520 extend his tax cuts. 0:07:29.680 --> 0:07:32.560 What I also felt was very interesting is the myriad 0:07:32.600 --> 0:07:35.360 of views in relation to the tech industry. So on 0:07:35.400 --> 0:07:37.680 the one hand of k lower taxes ya tech industry, 0:07:37.920 --> 0:07:41.000 he seems to embrace crypto clearly with JD. Vans, there's 0:07:41.040 --> 0:07:44.360 sort of an embrace of vcs, but big tech is 0:07:44.480 --> 0:07:46.960 very complicated. How did you parse through that? 0:07:47.360 --> 0:07:50.400 There's some contradictions here, Alex. I mean, the first is 0:07:50.920 --> 0:07:54.680 he's obviously very pro American business, and yet he's he's 0:07:54.760 --> 0:07:58.320 turned on TikTok and believes that banning TikTok would only 0:07:58.320 --> 0:08:02.440 empower Mark Zuckerberg Facebook. The second thing is, you know, 0:08:02.520 --> 0:08:06.160 in the first term, he talked a lot about cryptocurrency 0:08:06.360 --> 0:08:09.560 and how it might engender fraud. He wasn't wrong about 0:08:09.600 --> 0:08:12.680 that obviously, but now he's flipped on that as well. 0:08:12.960 --> 0:08:15.600 The bottom line here, and the way I interpreted, is 0:08:15.600 --> 0:08:19.240 that for Trump it's all about personal relationships, and he 0:08:19.280 --> 0:08:21.200 went and talked a lot about Tim Cook and how 0:08:21.240 --> 0:08:23.880 smart he thought Tim Cook was, in large part because 0:08:23.920 --> 0:08:26.280 Tim Cook went to the White House to ask for 0:08:26.360 --> 0:08:28.720 relief from the first set of tariffs. You know, he 0:08:28.960 --> 0:08:32.160 likes it when people come and you know, paid their respects, 0:08:32.520 --> 0:08:35.760 or at least visibly look to be on what he 0:08:35.800 --> 0:08:38.560 considers to be Team Trump, and so, you know in 0:08:38.640 --> 0:08:40.680 terms of crypto and a lot of people in that 0:08:40.679 --> 0:08:43.400 community are now pro Trump, and you know in terms 0:08:43.480 --> 0:08:46.240 of TikTok, where he's very popular on TikTok, and of 0:08:46.240 --> 0:08:48.880 course jeff yass one of the backers of Byte Dance 0:08:48.920 --> 0:08:51.520 as a Trump supporter. You can kind of see why 0:08:51.559 --> 0:08:55.280 these contradictions are sort of bundled into his views on technology. 0:08:55.800 --> 0:08:58.200 Tariffs, certainly, it seems to be the topic we've had 0:08:58.240 --> 0:09:00.960 both sides of the aisle talking about tariffs and tough 0:09:01.080 --> 0:09:03.960 tariff talk. Mister Trump used tariffs. 0:09:03.640 --> 0:09:05.040 Quite liberally, liberally. 0:09:05.080 --> 0:09:06.640 How do you think about tariffs these days? 0:09:06.720 --> 0:09:09.320 It's interesting, Paul. You know, I have not spent much 0:09:09.360 --> 0:09:13.280 time thinking about President William McKinley, the twenty fifth president. 0:09:13.440 --> 0:09:16.280 He was from my former state of Ohio, and Trump 0:09:16.360 --> 0:09:21.000 brought him up repeatedly because here's this nineteenth century president who, 0:09:21.320 --> 0:09:24.480 before the age of a federal income tax, was raising 0:09:24.559 --> 0:09:27.719 tariffs and bringing in money. And he said that McKinley 0:09:27.880 --> 0:09:31.240 is overlooked. Who knows what book club he's part of, 0:09:31.280 --> 0:09:34.400 but clearly they've been reading histories and he wants to 0:09:34.920 --> 0:09:37.720 raise tariffs. He thinks tariffs are underrated. He's talking about 0:09:37.720 --> 0:09:41.000 a ten percent across the board tariff. He's talking about 0:09:41.080 --> 0:09:44.760 raising the tariff on Chinese goods to sixty percent or 0:09:44.800 --> 0:09:47.760 even one hundred percent. And you know, he says they're 0:09:47.760 --> 0:09:51.240 a great negotiating ployee. He tried that in the first term. 0:09:51.559 --> 0:09:54.280 And obviously then you know a lot of US companies, 0:09:54.360 --> 0:09:57.560 particularly tech companies, complained, and they did. They were quite 0:09:57.559 --> 0:10:00.400 generous in their carve outs. But this is a a 0:10:00.440 --> 0:10:04.400 big part of Trumpanomics, and most economists think that companies 0:10:04.440 --> 0:10:06.720 don't pay those tariffs, they turn around and pass them 0:10:06.960 --> 0:10:09.800 to customers in the form of higher prices. So there 0:10:09.920 --> 0:10:11.480 we pressed them on it, and I think there are 0:10:11.480 --> 0:10:13.880 some unresolved contradictions and tensions there. 0:10:14.120 --> 0:10:16.880 What's also interesting, I was reading a JP Morgan note 0:10:16.880 --> 0:10:20.720 about commodities and what the Trump administration would do to commodities. 0:10:21.120 --> 0:10:24.200 Obviously that's my beat, but what they made the point 0:10:24.280 --> 0:10:27.040 is it really depends on the sequencing. So if you 0:10:27.080 --> 0:10:30.400 go to corporate taxes first, tariffs come later. Like the 0:10:30.400 --> 0:10:33.600 sequencing of how all of this works will really depend 0:10:33.640 --> 0:10:36.160 then on what the market reaction is. Did you get 0:10:36.160 --> 0:10:38.880 any sense of that in terms. 0:10:38.679 --> 0:10:41.440 Of how we would do it, I didn't. But I mean, 0:10:41.640 --> 0:10:45.120 one thing that impressed us, or is impressed upon us, 0:10:45.840 --> 0:10:49.559 is that in twenty sixteen he was unprepared to win, 0:10:50.000 --> 0:10:53.360 and he surrounded himself with people, maybe a bit impulsively, 0:10:53.480 --> 0:10:55.480 and he says that he would do it differently this time, 0:10:55.520 --> 0:10:59.000 that he knows who's loyal and who's not, and he's experienced, 0:10:59.000 --> 0:11:02.079 and he knows everybody time. And it just seemed to us, 0:11:02.240 --> 0:11:04.360 you know, that he is prepared to move quickly in 0:11:04.360 --> 0:11:07.440 what order I don't know, but particularly if he controls 0:11:07.480 --> 0:11:11.800 both houses in Congress, that they have an agenda that 0:11:11.800 --> 0:11:15.079 they're pretty much willing to implement. A blitz Creed. 0:11:14.840 --> 0:11:19.280 Speed Jamie Diamond as Secretary of Treasury thirty seconds spread. 0:11:19.840 --> 0:11:24.760 Yeah, yeah, what did he call him an overrated globalist once? Look, 0:11:24.800 --> 0:11:27.840 he's courting the business community. I you know, who knows 0:11:27.880 --> 0:11:32.400 if Diamond would do that, particularly considering how former members 0:11:32.440 --> 0:11:36.000 of Trump's administration often ended up being treated somewhat badly 0:11:36.080 --> 0:11:38.960 or breaking with him. But yeah, I mean, I think 0:11:39.320 --> 0:11:42.280 Trump wants to go and it's very important to him 0:11:42.280 --> 0:11:44.760 that business leaders like him. I mean that comes through 0:11:44.760 --> 0:11:46.840 in the interview and so he's doing this but to 0:11:46.840 --> 0:11:47.640 court them as well. 0:11:47.840 --> 0:11:50.679 Thanks to Bloomerg Business Week editor Brad Stone. Coming up, 0:11:50.720 --> 0:11:53.320 we'll take a deep dive into how various industries would 0:11:53.320 --> 0:11:56.320 be impacted by a Donald Trump or Joe Biden presidency. 0:11:56.440 --> 0:11:59.960 In November, you're listening to Bloomberg Intelligence on Bloomberg Radio, 0:12:00.000 --> 0:12:02.560 so providing in depth research and data on two thousand 0:12:02.559 --> 0:12:05.080 companies in one hundred and thirty industries. You can access 0:12:05.080 --> 0:12:08.320 Bloomberg Intelligence via Bigo on the terminal. I'm Paul Sweeney. 0:12:08.559 --> 0:12:09.559 This is Bloomberg. 0:12:14.440 --> 0:12:18.319 You're listening to the Bloomberg Intelligence podcast. Catch us live 0:12:18.400 --> 0:12:21.120 weekdays at ten am Eastern on Apple card Playing and 0:12:21.240 --> 0:12:24.080 broud Otto with the Bloomberg Business App. Listen on demand 0:12:24.160 --> 0:12:28.280 wherever you get your podcasts, or watch us live on YouTube. 0:12:29.040 --> 0:12:31.840 We move next to politics. The direction of government policy 0:12:31.840 --> 0:12:33.880 and the world's largest economy is at stake when the 0:12:33.960 --> 0:12:37.520 US Alexa president. In November, Bloomberg Intelligence took a deep 0:12:37.559 --> 0:12:40.679 dive into how various industries would be impacted with either 0:12:40.840 --> 0:12:43.520 Joe Biden or Donald Trump in office. For more on 0:12:43.600 --> 0:12:46.640 this research, we were joined by Nathan Dean, Bloomberg Intelligence 0:12:46.640 --> 0:12:50.000 Senior Policy analyst. We first asked Nathan to break down 0:12:50.080 --> 0:12:50.800 his findings. 0:12:51.000 --> 0:12:52.800 What we did is we started with the report by 0:12:52.800 --> 0:12:54.960 looking at what are the key sectors to watch, and 0:12:54.960 --> 0:12:57.319 we really had five of them. The first one was 0:12:57.360 --> 0:13:00.280 investment banks. If President Biden wins, you know, you could 0:13:00.280 --> 0:13:03.120 see somewhere between seven to ten eight percent increase in 0:13:03.160 --> 0:13:06.360 capital requirements. If President Trump wins, that could be off 0:13:06.400 --> 0:13:08.800 the table. We looked at electric vehicles. You know, the 0:13:08.840 --> 0:13:11.600 tax credits for the electric vehicles could be at risk 0:13:11.760 --> 0:13:14.720 during a tax reform debate next year. Like you mentioned, 0:13:14.880 --> 0:13:18.120 in terms of tax global manufacturers, President Trump has called 0:13:18.160 --> 0:13:21.439 for a fifteen percent corporate tax rate. Representative Steve Scalise 0:13:21.520 --> 0:13:24.440 said he's going to make the tax cuts for individuals permanent, 0:13:24.480 --> 0:13:27.240 so tax reform and the impact of manufacturing. And the 0:13:27.240 --> 0:13:30.600 other two were Healthcarecter that twenty five billion dollar subsidies 0:13:30.679 --> 0:13:33.520 that's really for seventeen and United Health. And then finally 0:13:33.520 --> 0:13:35.760 it was big tech. Because whether you get President Biden 0:13:35.880 --> 0:13:38.199 or President Trump, more likely than not you're going to 0:13:38.240 --> 0:13:42.200 get a very skeptical Washington towards big tech, certainly both 0:13:42.240 --> 0:13:44.200 in Congress and also on the enforcement side. 0:13:44.360 --> 0:13:46.080 Nate, then the question then becomes what can he and 0:13:46.120 --> 0:13:48.400 this has been the question throughout his four years. Also 0:13:48.800 --> 0:13:50.560 what can he do on his own? And what would 0:13:50.559 --> 0:13:51.920 he need a Republican Congress for? 0:13:52.520 --> 0:13:54.720 Yeah, So you know, I think one of the biggest 0:13:54.760 --> 0:13:57.360 questions we get from clients is what does the executive 0:13:57.520 --> 0:14:01.520 order landscape look like if President Trump wins? And I'd 0:14:01.520 --> 0:14:03.920 say about ninety percent of the time, an executive order 0:14:04.000 --> 0:14:05.760 is a fancy way of the president picking up the 0:14:05.800 --> 0:14:08.440 phone and saying to his staff, I expect you to 0:14:08.480 --> 0:14:11.040 do X, Y and Z. But there's a difference there. 0:14:11.080 --> 0:14:14.840 The difference is for trade, tariffs and foreign relations. The 0:14:14.880 --> 0:14:17.120 power of the presidency is a lot more powerful when 0:14:17.120 --> 0:14:19.960 it comes to that. So when President Trump uses words 0:14:19.960 --> 0:14:23.160 like nasty calling the European Union, you know, that's something 0:14:23.160 --> 0:14:24.720 that investors have to pay attention to. 0:14:25.080 --> 0:14:25.200 Now. 0:14:25.200 --> 0:14:27.240 When it comes to tariffs, the President can certainly go 0:14:27.280 --> 0:14:29.800 out there and say I want to do this, but 0:14:29.840 --> 0:14:32.000 then it's going to be up for Congress and the 0:14:32.040 --> 0:14:35.520 business community and so forth. But todentially try and influence 0:14:35.560 --> 0:14:37.920 the White House to either get to the appropriate amount 0:14:38.040 --> 0:14:40.360 or try in some cases stop it from even happening. 0:14:40.760 --> 0:14:44.760 So are there certain industries that you know, I think 0:14:44.760 --> 0:14:48.200 about the healthcare industry. I'm trying to think about regulated industries, 0:14:48.440 --> 0:14:51.200 and healthcare is certainly one of them. And you mentioned 0:14:51.200 --> 0:14:54.400 the subsidies. But the Republicans and the Democrats think differently 0:14:54.400 --> 0:14:55.840 about the economics of health care. 0:14:56.720 --> 0:14:59.760 Yeah, it does. And this is rarely where the process 0:14:59.800 --> 0:15:02.400 comes in the play, because that's subsidies. That twenty five 0:15:02.440 --> 0:15:06.320 billion dollars subsidies is Obamacare subsidies, and that requires an 0:15:06.320 --> 0:15:08.720 Act of Congress. And I think you don't need to 0:15:08.720 --> 0:15:11.320 be a Washington expert to know that gridlock is going 0:15:11.320 --> 0:15:14.240 to continue no matter who wins the presidency. So look 0:15:14.320 --> 0:15:19.200 for subdued actions from Congress when it comes to healthcare. Now, 0:15:19.320 --> 0:15:22.760 the difference is on the regulatory side. On the regulatory side, 0:15:22.800 --> 0:15:24.520 and this is where you look at the FDA and 0:15:24.560 --> 0:15:26.760 a lot of the actions they've been doing. You can 0:15:26.800 --> 0:15:31.120 bypass democratic opposition and just implement your own policies, but 0:15:31.200 --> 0:15:34.240 it takes time, and so I would say just general 0:15:34.360 --> 0:15:37.040 rule of thumb for a lot of the healthcare issues 0:15:37.080 --> 0:15:40.480 that are going out at the agencies after President Trump 0:15:40.520 --> 0:15:44.239 if he wins, where the input is new regulatory leadership, 0:15:44.680 --> 0:15:47.200 at that point, you probably have another eighteen months and 0:15:47.280 --> 0:15:50.760 twenty four month window for any regulatory change, So for 0:15:50.800 --> 0:15:53.880 the healthcare industry, there's a lot of time to prepare 0:15:53.920 --> 0:15:56.440 for any changes. You'll know exactly what's going to happen 0:15:56.440 --> 0:15:57.200 well before it does. 0:15:57.560 --> 0:16:01.960 Going back to the ev point, it feels like solar evs, 0:16:02.080 --> 0:16:04.760 stuff like hydrogen from the IRA, like those are the 0:16:04.760 --> 0:16:08.040 stuff maybe potentially on the chopping block potentially where the 0:16:08.080 --> 0:16:10.800 President Trump win. But then the Musk thing is weird 0:16:10.840 --> 0:16:14.000 because Elon Musk has definitely become a big supporter of 0:16:14.040 --> 0:16:17.720 President Trump donating to super packs, and I'm wondering if 0:16:17.840 --> 0:16:21.160 that relationship will change the calculus to how President Trump 0:16:21.160 --> 0:16:22.240 sees electric vehicles. 0:16:23.320 --> 0:16:24.920 Absolutely, you hit it right on the head and we 0:16:24.960 --> 0:16:27.160 even say this in the report. There's a difference between 0:16:27.240 --> 0:16:29.600 headline risk and reality. So if you look at the 0:16:29.600 --> 0:16:32.200 electric vehicles, you can look at statements that President Trump 0:16:32.240 --> 0:16:34.840 and other Republicans have said saying they do not like 0:16:34.920 --> 0:16:37.720 these electric vehicle tax credits out there and so forth. 0:16:37.840 --> 0:16:39.720 But then you balance it with the Elon Musk and 0:16:39.760 --> 0:16:42.840 even taking it to grander scale on the Inflation Reduction Act. 0:16:43.080 --> 0:16:45.240 A lot of the benefits of the IRA are going 0:16:45.240 --> 0:16:48.160 to gop led states. So what you have to do 0:16:48.240 --> 0:16:51.320 here is a take the statement. Okay, if President Trump 0:16:51.400 --> 0:16:54.200 says I want to do away with the electric vehicle 0:16:54.240 --> 0:16:56.720 tax credit, how am I going to do that? Most likely, 0:16:56.760 --> 0:16:58.880 I'll do that as part of tax reform and via 0:16:58.960 --> 0:17:02.400 the reconciliation, which means I probably won't have any Democrats 0:17:02.400 --> 0:17:04.480 going on board with me, so I need all Republicans 0:17:04.520 --> 0:17:08.160 on board at that point. If Elon Musk starts whispering saying, hey, 0:17:08.400 --> 0:17:10.880 we like these tax credits for the EB world, then 0:17:11.080 --> 0:17:13.360 that change may not even be a high priority anymore. 0:17:13.560 --> 0:17:15.280 So I would just say that for a lot of 0:17:15.280 --> 0:17:17.879 the statements, you have to remember short term risk versus 0:17:17.920 --> 0:17:21.440 long term risk. And as we see with every single election, 0:17:21.800 --> 0:17:23.919 politicians of both parties love to go out there and 0:17:23.960 --> 0:17:25.639 say I'm going to do X, Y and Z, but 0:17:25.680 --> 0:17:28.399 then when they get into power, it's XYZ minus a 0:17:28.440 --> 0:17:29.960 whole bunch of other stuff because I'm going to be 0:17:30.000 --> 0:17:31.120 a little bit more moderate now. 0:17:31.560 --> 0:17:33.920 And Nathan, how about for our good friends on Wall 0:17:33.960 --> 0:17:36.800 Street M and A bankers and lawyers. Under this administration, 0:17:36.840 --> 0:17:39.000 the regulator has been pretty tough, and it's been pretty 0:17:39.040 --> 0:17:41.720 tough to get big M and A deals approved, presumably 0:17:42.800 --> 0:17:45.399 that would be more Wall Street friendly M and A 0:17:45.600 --> 0:17:48.560 friendly with a Republican administration, it. 0:17:48.520 --> 0:17:51.520 Really depends on the leadership that President Trump, again, if 0:17:51.520 --> 0:17:53.080 he were to win, would put in place at the 0:17:53.160 --> 0:17:55.840 FTC and the DOJ. Because you have one side, you 0:17:55.840 --> 0:17:59.359 have the Republican business friendly view, the stereotypical Republican business 0:17:59.359 --> 0:18:01.720 friendly view. If you get somebody like Jamie Diamond, and 0:18:01.760 --> 0:18:04.080 I'm just picking on the banking execs. If you get 0:18:04.119 --> 0:18:06.560 somebody from Wall Street, like a Gary Cohne individual that 0:18:06.720 --> 0:18:09.960 was in his last administration, then you could just reasonably 0:18:10.000 --> 0:18:11.880 say that M and A activity will get a little 0:18:11.880 --> 0:18:14.120 bit easier. But if you get somebody that comes from 0:18:14.119 --> 0:18:17.560 the economic populist side of the party. For example, Senator Vance, 0:18:17.600 --> 0:18:21.080 the vice presidential candidate, spoke in favor of the FDAC 0:18:21.240 --> 0:18:23.399 chair will Lim and Kahn and said that she was 0:18:23.440 --> 0:18:26.960 one of Biden's best picks. And so if President Trump 0:18:27.040 --> 0:18:30.240 comes out and picks an economic populist for the heads 0:18:30.280 --> 0:18:32.960 of the FTC and the DOJ, M and A made 0:18:33.119 --> 0:18:35.359 very difficult for the next few years. It really just 0:18:35.359 --> 0:18:37.720 depends who's going to get that nod, and that would 0:18:37.760 --> 0:18:40.399 come right after inauguration to President Trump wins our. 0:18:40.280 --> 0:18:43.760 Thanks to Nathan Dean Bloomberg Intelligence senior policy analysts. We 0:18:43.880 --> 0:18:46.840 move next to the EV space and Tesla this way, 0:18:46.840 --> 0:18:48.600 if you heard, the ev maker is looking to hire 0:18:48.640 --> 0:18:51.640 nearly eight hundred new employees. This comes nearly three months 0:18:51.680 --> 0:18:54.600 after CEO Elon Musk ordered the largest round of layoffs 0:18:54.640 --> 0:18:56.879 in the company's history. From her on this and the 0:18:56.920 --> 0:18:59.280 state of the EV industry, we were joined by Craig 0:18:59.320 --> 0:19:02.720 Trudell bloom For a Global Autos editor first ask for 0:19:02.840 --> 0:19:04.600 more context on this week's news. 0:19:04.800 --> 0:19:08.560 This is very Elon Muskian of Tesla in that it 0:19:08.720 --> 0:19:11.160 sort of you know, depends on the day of what's 0:19:11.200 --> 0:19:14.720 going on at this company. So, yes, a few months 0:19:14.720 --> 0:19:19.119 back on the heels of Tesla selling about twenty percent 0:19:19.240 --> 0:19:22.760 fewer cars than it did in the fourth quarter, Elon 0:19:22.840 --> 0:19:27.080 Musk wasn't particularly happy with that quarterly showing he wanted 0:19:27.119 --> 0:19:31.080 the company to cut headcount by a commensurate amount, so 0:19:31.240 --> 0:19:35.199 roughly twenty percent, So you know, for context, you know, 0:19:35.240 --> 0:19:38.000 this is a company that you know, had quite a 0:19:38.040 --> 0:19:41.520 few employees at that time. They started the year with 0:19:41.560 --> 0:19:43.400 a round one hundred and forty thousand, so that would 0:19:43.480 --> 0:19:47.480 mean twenty eight thousand people being let go. It's unclear 0:19:47.560 --> 0:19:50.560 whether they got to that, but it is absolutely clear that, 0:19:50.680 --> 0:19:53.679 you know, certain parts of the company were decimated, I 0:19:53.680 --> 0:19:56.800 think most notably the super Charging team that really turned 0:19:56.840 --> 0:19:58.679 a lot of heads because it was a you know, 0:19:58.800 --> 0:20:01.240