WEBVTT - Rocket to Buy Mr. Cooper, Gold Surges Amid Tariff Fears

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<v Speaker 1>Bloomberg Audio Studios, Podcasts, radio News. You're listening to the

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<v Speaker 2>M and A Trade Today, M and A Monday.

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<v Speaker 3>We haven't had too many deals this year, but we

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<v Speaker 3>had one in the finance business, Rocket Mortgage to buy

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<v Speaker 3>mortgage firm, mister Cooper, and a nine point four billion

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<v Speaker 3>dollar deal all stock deal again. The first thing, you

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<v Speaker 3>know me, what I do is I go to m A,

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<v Speaker 3>go and see who's getting paid here Jp Morgan advising

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<v Speaker 3>the acquirer. Here at Rocket and City advising the target

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<v Speaker 3>mister Cooper. So everybody's getting paid there. I worked at

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<v Speaker 3>both of those firms, so both of those folks getting paid.

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<v Speaker 3>All right, let's talk about what's going on here. Paige

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<v Speaker 3>Smith joins his consumer financial reporter for Bloomberg News. Paige,

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<v Speaker 3>talk to us about this deal. Mortgage, I've Rocket More,

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<v Speaker 3>I've heard of it, I've never heard of mister Cooper.

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<v Speaker 2>Who are they?

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<v Speaker 4>So, mister thanks for having me. Mister Cooper. Is more

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<v Speaker 4>is best known, I would say, in the mortgage servicing

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<v Speaker 4>side of things. So it's sort of after the fact,

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<v Speaker 4>you've got your mortgage, but who are you actually interacting with,

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<v Speaker 4>you know, gears down the line, it's actually going to

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<v Speaker 4>be mister Cooper. But this is a big deal for

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<v Speaker 4>Rocket because they've kind of they've been trying to position

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<v Speaker 4>themselves as sort of a one stop shop for consumers

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<v Speaker 4>finance offerings, So think credit cards in addition to your

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<v Speaker 4>mortgage and you know, now theoretically your mortgage servicing rights.

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<v Speaker 4>So it's a pretty big deal for this company based

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<v Speaker 4>in Detroit. Dan Gilbert a pretty prominent person in the

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<v Speaker 4>finance yep, pretty big in sports as well. But nine

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<v Speaker 4>point four billion dollars, it's a big deal for these folks.

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<v Speaker 5>And earlier this month we have Rocket also striking a

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<v Speaker 5>deal to acquire redfin, which is a real estate brokerage.

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<v Speaker 5>How will that build into this one or if they're

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<v Speaker 5>even connected.

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<v Speaker 4>At all, certainly it's it is basically sort of from

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<v Speaker 4>a sort of a nose to toe, if you will,

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<v Speaker 4>of the home buying experience, everything will sort of be

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<v Speaker 4>under this Rocket umbrella. It you know, Redfinn as you

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<v Speaker 4>as I think a lot of folks will know quite

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<v Speaker 4>well is this platform for buying and selling homes, and

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<v Speaker 4>it would be sort of a starting point for the

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<v Speaker 4>home buying journey. Rocket is well known for originating, getting

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<v Speaker 4>or creating mortgages, and now mister Cooper is well known

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<v Speaker 4>for sort of the servicing of mortgages. So it's it

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<v Speaker 4>is kind of from start to finish up the home

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<v Speaker 4>buying process. Theoretically, if they.

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<v Speaker 2>Got a lot of debt on their boundary.

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<v Speaker 3>Because I being a former banker, I don't look at

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<v Speaker 3>stock market values. I look at enterprise value to include

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<v Speaker 3>the debt. It's eighteen point five billion dollars because that's

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<v Speaker 3>what you get paid on. You get paid on enterprise A.

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<v Speaker 3>So that is a big, big number there. Talk to

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<v Speaker 3>us about the mortgage business. I mean, is it doesn't

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<v Speaker 3>seem like there's a lot of deals happening in the

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<v Speaker 3>in the business.

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<v Speaker 4>Well, I mean, I think we can look at interest rates.

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<v Speaker 4>It's certainly been a tough time for home buyers and sellers,

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<v Speaker 4>and that also weighs on these home on these home lenders.

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<v Speaker 4>It's a tough time for folks who kind of have

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<v Speaker 4>put their eggs all in one basket, which is the

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<v Speaker 4>home lending business. But that's kind of what Rocket has

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<v Speaker 4>been aiming to do, is to really branch out and

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<v Speaker 4>diversify their business so they're not so interest rate reliant

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<v Speaker 4>or exposed rather which they have been in the past,

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<v Speaker 4>and frankly that's showed up in their earnings over the

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<v Speaker 4>past couple of years. So I chatted with Ceover and

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<v Speaker 4>Krishna over the summer. Actually we did kind of a

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<v Speaker 4>deeper dive into Rocket and the company, and one thing

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<v Speaker 4>that he told me then was that artificial intelligence is

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<v Speaker 4>actually a big bet that they're making to really try

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<v Speaker 4>to boost the business and make that home buying process

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<v Speaker 4>truly as smooth as possible for the customers to kind

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<v Speaker 4>of amp up their offerings, and we'll see how it

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<v Speaker 4>works out with for them in the end. But so far,

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<v Speaker 4>numbers look pretty good.

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<v Speaker 5>What was this deal expected? Were you hearing chatter before?

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<v Speaker 5>Did its completely shock you?

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<v Speaker 4>I was not hearing chatter before, and it seems like

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<v Speaker 4>the market is responding in kind of an interesting way.

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<v Speaker 4>But we're going to continue to follow the story and

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<v Speaker 4>see how this kind of fits into the broader Rocket story.

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<v Speaker 2>Who do they compete against?

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<v Speaker 3>Do they compete against the banks that make the loans,

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<v Speaker 3>or the banks that make the loans usually just syndicate

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<v Speaker 3>them away. Right.

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<v Speaker 4>Well, I kind of take a different take on that

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<v Speaker 4>since I covered consumer and finance kind of broadly. I

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<v Speaker 4>think of folks who are kind of trying to be

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<v Speaker 4>that one one stop shop for consumer the consumer finance experience.

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<v Speaker 4>So for me, I think of you know, so FI

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<v Speaker 4>technologies for example. Yes, that is like a they have

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<v Speaker 4>a lot of lending opportunities for consumers, but they do

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<v Speaker 4>a heck of a lot of other business as well.

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<v Speaker 4>Robinhood even coming at it from the investing side of

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<v Speaker 4>things now offering banking products for folks. That's kind of

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<v Speaker 4>how I think about it in terms of competitors. But

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<v Speaker 4>that's just from a fintech consumer finance perspective. When it

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<v Speaker 4>comes to home lenders, you know, other big folks in

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<v Speaker 4>the space, the space. I was just looking at some

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<v Speaker 4>data by Inside Mortgage Finance that placed United Wholesale Mortgagees

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<v Speaker 4>number one, Pennymac is number two, and Rocket as number three.

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<v Speaker 3>Penny Mac is what I use any that rings a bell, Okay,

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<v Speaker 3>Dan Gilbert, Just for what it's worth, Kids on the

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<v Speaker 3>rich top list of Bloomberg all the wealthy people.

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<v Speaker 2>He comes in at number sixty two. That's not bad.

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<v Speaker 3>Net worth of twenty eight point seven billion dollars up

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<v Speaker 3>two point six billion year to date.

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<v Speaker 4>Yeah, he's a force in Detroit. I would say some

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<v Speaker 4>of our colleagues out of the Detroit Bureau did a

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<v Speaker 4>great story on him last year. If you're interested in

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<v Speaker 4>the terminal, David Welch shout out, all.

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<v Speaker 2>Right, Page, thank you so much, appreciate it.

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<v Speaker 3>Page Smith, consumer financi reporter of Bloomberg News, joining us

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<v Speaker 3>in our studio here talking about Rocket mortgage buying mortgage

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<v Speaker 3>firm mister Cooper nine point four billion dollar deal, so

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<v Speaker 3>make more consolidation in that processing business of the mortgage business.

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<v Speaker 1>You're listening to the Bloomberg Intelligence Podcast. Catch us live

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<v Speaker 3>As we're talking about all morning, Gold hitting another high today,

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<v Speaker 3>up another thirty six dollars. That's one point one percent,

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<v Speaker 3>three and twenty. I don't know, mbeed, Mike mcloone's got

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<v Speaker 3>some thoughts here. Mike McGlone's Bloomberg Intelligence senior commodity strategist.

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<v Speaker 3>He's down there in Miami Beach, of course he is, Mike. Now,

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<v Speaker 3>it just seems kind of silly here. I mean, just

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<v Speaker 3>every day we're up one percent. It can't just be

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<v Speaker 3>the Chinese banks and Chinese.

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<v Speaker 2>Consumers haul on, you know, hoarding all this stuff. What's

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<v Speaker 2>going on out there now?

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<v Speaker 6>I think we have gold trading basically as a put

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<v Speaker 6>with the S and B five hundred, but it's almost

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<v Speaker 6>one to one five hundreds, down about a percent today,

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<v Speaker 6>and gold's up about a one percent today. So the

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<v Speaker 6>bull is getting food, and the bull does need food.

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<v Speaker 6>Gold is stretched above three thousand dollars and ounce. I

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<v Speaker 6>think that's now a support level, but it's.

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<v Speaker 7>Doing what it should do in an environment.

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<v Speaker 6>We have a very extended US stock market going back downward.

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<v Speaker 6>At the same time, it's taking the dollar with it,

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<v Speaker 6>which has been usually odd. We kind of risk off

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<v Speaker 6>the dollars going down. It's because the stock the dollar's

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<v Speaker 6>so expensive too. So still very bullish gold, but I

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<v Speaker 6>think you have to remember what it's doing now. It's

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<v Speaker 6>what's our key thing is we've had four years of

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<v Speaker 6>outflows and ETFs. Now they're starting to turn inflows. At

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<v Speaker 6>the same time we've seen bitcoin peaking, so it looks

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<v Speaker 6>like it's big pictures reversion just getting started. I'm still

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<v Speaker 6>bullish gold, but it's somewhat dependent on that stock market

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<v Speaker 6>going down.

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<v Speaker 5>At these levels, it is hard to ignore gold ETFs, Mike.

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<v Speaker 5>I mean, we've seen February in March, both months they

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<v Speaker 5>took in twelve billion. That's the most since at least

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<v Speaker 5>five years. So investors are really plowing into that. But

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<v Speaker 5>recent buyers are also buying bars, coins and ETF so

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<v Speaker 5>I think it's maybe the multiple avenues that they can

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<v Speaker 5>express their views on goal.

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<v Speaker 7>Yeah.

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<v Speaker 6>So I think what you're seeing is we see we

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<v Speaker 6>saw central banks are still buying, but they've been really

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<v Speaker 6>big buyers the last years. And at the same time,

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<v Speaker 6>with the stock market and a tear and high interest rates,

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<v Speaker 6>ETF investors, most notably in the US and Western country,

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<v Speaker 6>we're just selling say sorry, I don't need the rock.

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<v Speaker 6>But now they're starting to realize the rock is really outperforming.

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<v Speaker 6>It's almost four years now, one two, three, four years

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<v Speaker 6>now it's beating the stock market and performance is starting

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<v Speaker 6>to win.

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<v Speaker 7>It's also seeing that what they were told about digital gold.

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<v Speaker 6>Bitcoin it was better than gold, is finding out this

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<v Speaker 6>bitcoin's down about thirty percent with the S and B

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<v Speaker 6>five correcting about ten percent.

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<v Speaker 7>It's proving its leverage beta.

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<v Speaker 6>At the same time, gold's up while the stock market's

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<v Speaker 6>going down. So they're seeing that diversication and shift over.

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<v Speaker 7>The question is what stops it?

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<v Speaker 6>And if you look at people like Anna Wong and

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<v Speaker 6>Gena Martin Adams, I still think the US stock market

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<v Speaker 6>can go lower with US GDP and US economic growth,

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<v Speaker 6>and that's.

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<v Speaker 7>Very bullish for gold long bonds and bad for the

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<v Speaker 7>stock market.

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<v Speaker 3>So again, there's no pe ratio to look at here, Mike,

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<v Speaker 3>for an investor to say, oh boy, this is historically

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<v Speaker 3>expensive here. You know, we need to get get out

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<v Speaker 3>of a certain commodity. How do you kind of talk

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<v Speaker 3>to clients about I guess just relative value.

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<v Speaker 6>Well, one of my favorite ways look at gold palls

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<v Speaker 6>the away what I published this morning. You take the

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<v Speaker 6>price of gold announces divided by the S and P

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<v Speaker 6>five hundred and it's just bumping up.

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<v Speaker 7>Above zero point five, meaning you need.

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<v Speaker 6>Two S and B five rs for one gold, and

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<v Speaker 6>the last key times it did that was nineteen seventy

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<v Speaker 6>two on the way up big rally.

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<v Speaker 7>Remember that one. I was very young in.

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<v Speaker 6>Two thousand and seven on the way up, and it's

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<v Speaker 6>been now it's starting to break up higher. At the

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<v Speaker 6>same time, the stock market's dropping from two times market

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<v Speaker 6>caped to GDP. I mean that hasn't happened in US

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<v Speaker 6>since the nineteen thirties. It's happened in Japan and nineties.

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<v Speaker 6>It's happened in China in just.

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<v Speaker 7>Few years ago.

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<v Speaker 6>So that crocodile crocodile joe patterns just starting.

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<v Speaker 7>To narrow, and I'm worried this it's going to keep narrowing.

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<v Speaker 6>That means gold out performing most assets as a stock

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<v Speaker 6>market just reverts to more normal levels.

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<v Speaker 5>I'm going to resist bringing in bitcoin here since they're

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<v Speaker 5>also right bitcoin and I know you write bitcoin two.

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<v Speaker 5>But let's talk about can copper beat gold in a

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<v Speaker 5>year of unprecedented austerity and tires in China increasingly relying

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<v Speaker 5>on stimulus.

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<v Speaker 6>Well, I love the question because you know my answer

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<v Speaker 6>is the questions leading as if I thought you're bringing

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<v Speaker 6>im Glad you brought that up to my outlook for

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<v Speaker 6>this month, I think copper's more likely to go to four,

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<v Speaker 6>partly because I'm an next trader.

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<v Speaker 7>I used to have have here. I know I probably

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<v Speaker 7>would have been stopped out trying to short it. But

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<v Speaker 7>now last week it made a new high.

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<v Speaker 6>US copper price peaked at five dollars and thirty seven,

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<v Speaker 6>down five dollars and thirty seven cents a pound. Last

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<v Speaker 6>year's high was five twenty and then it dropped the four.

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<v Speaker 6>But the reason it went up is for odd reasons. Okay,

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<v Speaker 6>it's expecting tariffs. We haven't had the tariffs and it's

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<v Speaker 6>fully priced them in. So what copper usually does, it

0:10:42.200 --> 0:10:44.600
<v Speaker 6>goes down because it goes up. And I think if

0:10:44.600 --> 0:10:46.599
<v Speaker 6>we see further weakness in the US stock mark, I

0:10:46.600 --> 0:10:49.480
<v Speaker 6>think copper's much more likely dropped towards four. It's very

0:10:49.520 --> 0:10:52.040
<v Speaker 6>unlikely to get to six, and that's what normally happens.

0:10:52.080 --> 0:10:55.320
<v Speaker 6>If it continues higher from here, it's very discombobulating and

0:10:55.360 --> 0:10:59.400
<v Speaker 6>it's really is counter to one of the major some

0:10:59.440 --> 0:11:03.000
<v Speaker 6>of the major goals of President Trump, that's on showing productivity,

0:11:03.000 --> 0:11:09.040
<v Speaker 6>on showing markets and production and lower inflation and lower yields.

0:11:09.720 --> 0:11:12.440
<v Speaker 3>Hey, Mike, you're from the farm belt. How's the US

0:11:12.480 --> 0:11:13.400
<v Speaker 3>farmer doing these days?

0:11:14.480 --> 0:11:17.520
<v Speaker 6>They're having a rough time, most notably because of lower prices.

0:11:17.559 --> 0:11:19.480
<v Speaker 6>The key thing I learned from farmers when I go

0:11:19.520 --> 0:11:22.320
<v Speaker 6>out there, they all dagg out look at it. I'll

0:11:22.320 --> 0:11:25.360
<v Speaker 6>be out there next month is the quote from Mark

0:11:25.400 --> 0:11:27.080
<v Speaker 6>Twain that they don't make land anymore.

0:11:27.080 --> 0:11:28.600
<v Speaker 7>I should buy some. And the quote is, well they

0:11:28.600 --> 0:11:32.360
<v Speaker 7>are in Brazil. Massive supply of soybeans out of Brazil.

0:11:32.400 --> 0:11:33.079
<v Speaker 7>That's the key thing.

0:11:33.080 --> 0:11:36.840
<v Speaker 6>It's a reaction to the big pumping prices, technology, bringing

0:11:36.840 --> 0:11:41.559
<v Speaker 6>them on better infrastructure. Brazil now exports double the soybeans

0:11:41.559 --> 0:11:43.680
<v Speaker 6>the US does. US has been about the same for

0:11:43.760 --> 0:11:46.400
<v Speaker 6>ten years. Ten years ago they exported a lot less.

0:11:46.440 --> 0:11:49.360
<v Speaker 6>So that supplies being met, prices are heading lower. You

0:11:49.440 --> 0:11:51.960
<v Speaker 6>basically need a US drought for US grain prices to

0:11:52.000 --> 0:11:52.680
<v Speaker 6>go up this year.

0:11:53.040 --> 0:11:55.200
<v Speaker 3>All right, tough one there. Mike mcloughan, thanks so much

0:11:55.240 --> 0:11:58.080
<v Speaker 3>for joining us. I always appreciate getting some time from you.

0:11:58.120 --> 0:12:00.679
<v Speaker 3>We can talk about anything, for metals, the precious to

0:12:00.760 --> 0:12:03.280
<v Speaker 3>the base metals, to the softs and oil and all

0:12:03.280 --> 0:12:03.840
<v Speaker 3>that kind of stuff.

0:12:03.880 --> 0:12:04.520
<v Speaker 2>So Mike covers it all.

0:12:04.559 --> 0:12:07.119
<v Speaker 3>Mike mcglon's and your commodity strategies for Bloomberg Intelligence.

0:12:09.200 --> 0:12:12.880
<v Speaker 1>You're listening to the Bloomberg Intelligence podcast. Catch us Live

0:12:13.000 --> 0:12:16.360
<v Speaker 1>weekdays at ten am Eastern on Applecarckley and Android Auto

0:12:16.480 --> 0:12:19.520
<v Speaker 1>with the Bloomberg Business App. Listen on demand wherever you

0:12:19.559 --> 0:12:22.560
<v Speaker 1>get your podcasts, or watch us live on YouTube.

0:12:23.080 --> 0:12:25.400
<v Speaker 3>All right, we got them, Sean Donn and he's down

0:12:25.440 --> 0:12:28.920
<v Speaker 3>in d C. He's joined us right now, senior economics writer. Sean,

0:12:28.960 --> 0:12:31.640
<v Speaker 3>you're in DC. You have to have some scoop for us, man.

0:12:31.679 --> 0:12:33.679
<v Speaker 3>What's going to happen? What's the President going to do

0:12:33.720 --> 0:12:34.840
<v Speaker 3>on Wednesday with these TERFs?

0:12:36.120 --> 0:12:39.800
<v Speaker 8>Well, look, the scoop this week is less about what

0:12:39.840 --> 0:12:42.080
<v Speaker 8>we're going to get on Wednesday, and I think really

0:12:42.080 --> 0:12:44.679
<v Speaker 8>thinking about the direction and I think that's what the

0:12:44.720 --> 0:12:46.920
<v Speaker 8>markets have been thinking about more and more in the

0:12:46.960 --> 0:12:50.400
<v Speaker 8>last couple of weeks. And the details of exactly what

0:12:50.440 --> 0:12:53.800
<v Speaker 8>we're going to get on Wednesday when the President steps

0:12:53.880 --> 0:12:57.000
<v Speaker 8>up to the microphone and announces these reciprocal tariffs and

0:12:57.120 --> 0:13:00.920
<v Speaker 8>proclaims liberation Day for the US economy are still being

0:13:00.920 --> 0:13:03.480
<v Speaker 8>worked out. And we heard that over the weekend. We

0:13:03.600 --> 0:13:08.280
<v Speaker 8>heard Kevin Hassett, the head of the National Economic Council,

0:13:08.360 --> 0:13:10.600
<v Speaker 8>saying he didn't know he didn't have any forward guidance

0:13:10.600 --> 0:13:13.600
<v Speaker 8>to offer as to what was coming. He just said

0:13:13.640 --> 0:13:16.760
<v Speaker 8>he trusts the president to decide to do the right thing.

0:13:16.840 --> 0:13:19.480
<v Speaker 8>Now what that right thing is, we don't know. But look,

0:13:19.840 --> 0:13:22.800
<v Speaker 8>the reality is the direction is a kind of known

0:13:22.880 --> 0:13:26.600
<v Speaker 8>here despite all this uncertainty, and that is that Donald

0:13:26.640 --> 0:13:28.880
<v Speaker 8>Trump is going to impose more tariffs, and then after

0:13:28.920 --> 0:13:32.160
<v Speaker 8>that there's going to come some more tariffs. And really

0:13:32.200 --> 0:13:35.600
<v Speaker 8>we are seeing the erection of a tariff wall around

0:13:35.640 --> 0:13:40.120
<v Speaker 8>the US economy, and we just don't know yet exactly

0:13:40.160 --> 0:13:43.400
<v Speaker 8>how high that wall is, but we are seeing a

0:13:43.440 --> 0:13:47.960
<v Speaker 8>real structural change in economic policy. And that is what

0:13:48.040 --> 0:13:52.160
<v Speaker 8>Donald Trump has been promising, not just during the last

0:13:52.200 --> 0:13:55.680
<v Speaker 8>year's campaign, but going back to twenty fifteen. And here

0:13:55.720 --> 0:13:57.880
<v Speaker 8>we are this week, we're going to see his biggest

0:13:57.920 --> 0:13:59.240
<v Speaker 8>attempt at that so far.

0:14:00.120 --> 0:14:02.160
<v Speaker 5>I was reading about this over the weekend, and we

0:14:02.280 --> 0:14:04.920
<v Speaker 5>have some reporting that Trump prefers a quote big and

0:14:04.960 --> 0:14:09.560
<v Speaker 5>simple tariff plan, suggesting no expectations or expectations could be

0:14:09.559 --> 0:14:14.520
<v Speaker 5>hard to come by. What does that mean for everyone.

0:14:13.480 --> 0:14:17.640
<v Speaker 8>Well, it means that Donald Trump likes big, round numbers.

0:14:17.800 --> 0:14:20.920
<v Speaker 8>And we've seen that going back to his first term

0:14:21.520 --> 0:14:25.600
<v Speaker 8>when he was urging his aids to scale up tariffs

0:14:25.680 --> 0:14:28.480
<v Speaker 8>rather than tone down tariffs when he was applying him

0:14:28.480 --> 0:14:30.880
<v Speaker 8>on Chinese goods. And I think we can expect the

0:14:30.920 --> 0:14:34.160
<v Speaker 8>same thing to happen this time around. Just over the

0:14:34.160 --> 0:14:38.040
<v Speaker 8>weekend we saw this again. When you know, previously Scott Essen,

0:14:38.120 --> 0:14:41.480
<v Speaker 8>the treasur the Treasury Secretary, had talked about a dirty fifteen,

0:14:41.880 --> 0:14:45.520
<v Speaker 8>signating that perhaps they were going to limit the tariffs

0:14:45.520 --> 0:14:48.240
<v Speaker 8>to the fifteen worst offenders when it came to the

0:14:48.320 --> 0:14:51.680
<v Speaker 8>US trade deficit and Donald Trump last night a board

0:14:51.720 --> 0:14:53.480
<v Speaker 8>Air Force one came back and said, no, it's going

0:14:53.520 --> 0:14:57.360
<v Speaker 8>to apply to all countries. So he wants something simple,

0:14:57.600 --> 0:15:01.320
<v Speaker 8>He wants something that he can sell to his but

0:15:01.400 --> 0:15:06.120
<v Speaker 8>he also wants something that can be transformational in his

0:15:06.280 --> 0:15:09.360
<v Speaker 8>mind for the US economy. He sees this as a

0:15:09.480 --> 0:15:13.080
<v Speaker 8>chance to put his stamp on US economic history and

0:15:13.160 --> 0:15:16.240
<v Speaker 8>in some ways repair the bad name that tariffs have

0:15:16.320 --> 0:15:18.080
<v Speaker 8>had for decades and decades.

0:15:18.880 --> 0:15:22.520
<v Speaker 3>Sean, what do we do about retaliation from some of

0:15:22.560 --> 0:15:25.520
<v Speaker 3>our big, biggest trading partners these days, Well.

0:15:25.320 --> 0:15:27.600
<v Speaker 8>We know it's going to come. That's what happens. Where

0:15:27.640 --> 0:15:31.240
<v Speaker 8>the Canadians have talked about it, the European Union have

0:15:31.320 --> 0:15:35.480
<v Speaker 8>talked about it. We've already seen retaliation from China, you know,

0:15:35.520 --> 0:15:37.680
<v Speaker 8>and that's where a lot of the economic damage will

0:15:37.720 --> 0:15:41.280
<v Speaker 8>come as well. Of course, you can model the direct

0:15:41.280 --> 0:15:44.800
<v Speaker 8>impact of reciprocal tariffs, and our folks at Bloomberg Economics

0:15:45.240 --> 0:15:49.120
<v Speaker 8>have modeled what they call a maximalist scenario, which would

0:15:49.480 --> 0:15:52.280
<v Speaker 8>take four percent off US GDP over the next two

0:15:52.360 --> 0:15:55.800
<v Speaker 8>to three years. But that doesn't account for retaliation. It

0:15:55.840 --> 0:16:00.600
<v Speaker 8>doesn't account for what happens to business investment when you

0:16:00.640 --> 0:16:04.160
<v Speaker 8>have global trade wars that kind of batter everyone and

0:16:04.320 --> 0:16:06.440
<v Speaker 8>throw a huge amount of uncertainty into the mix.

0:16:07.120 --> 0:16:09.680
<v Speaker 5>Come Wednesday, what is the one thing or two things

0:16:09.680 --> 0:16:11.440
<v Speaker 5>that you're going to rush to look at, or the

0:16:11.520 --> 0:16:15.920
<v Speaker 5>thing that has been the most ambiguous, and now you're

0:16:15.960 --> 0:16:19.640
<v Speaker 5>looking for certainty if we get certainty on Wednesday, So.

0:16:19.640 --> 0:16:22.320
<v Speaker 8>The thing I'm really looking for is what comes next. Right,

0:16:22.640 --> 0:16:26.040
<v Speaker 8>we're expecting tariffs to be announced that will take effect

0:16:26.080 --> 0:16:29.200
<v Speaker 8>April third. The President has already said that auto tariffs

0:16:29.480 --> 0:16:32.400
<v Speaker 8>will go into effect April third. So I'll look at

0:16:32.800 --> 0:16:35.680
<v Speaker 8>what other tariffs will go into immedia effect, but also

0:16:35.800 --> 0:16:38.800
<v Speaker 8>the sorts of investigations that he is going to launch.

0:16:38.840 --> 0:16:41.960
<v Speaker 8>He has talked about other sectoral tariffs on everything from

0:16:42.000 --> 0:16:45.920
<v Speaker 8>semiconductors to copper. All of those are probably going to

0:16:46.360 --> 0:16:50.000
<v Speaker 8>involve investigations that are going to be launched under certain

0:16:50.000 --> 0:16:53.600
<v Speaker 8>trade authorities. And you know that's the tariffs that will

0:16:53.640 --> 0:16:55.840
<v Speaker 8>come after what we get on Wednesday.

0:16:55.960 --> 0:16:57.920
<v Speaker 3>All right, Sean, thank you so much, really appreciate. I'm

0:16:57.920 --> 0:16:59.760
<v Speaker 3>sure we're going to be talking to you quite often

0:17:00.240 --> 0:17:02.680
<v Speaker 3>in the coming day. Seawan Donnam. He's the senior economics

0:17:02.680 --> 0:17:07.119
<v Speaker 3>writer for Bloomberg News. He's based down there in Washington, DC.

0:17:08.119 --> 0:17:12.840
<v Speaker 1>This is the Bloomberg Intelligence Podcast, available on Apple, Spotify,

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