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Speaker 2: Hey, President Trump for poorly said he is in no
Speaker 2: hurry to end the war with Iran, and a US
Speaker 2: naval blockade on Iranian ports is putting pressure, at no
Speaker 2: doubt about it, on the country. President also warning that
Speaker 2: if Alman gets in the way, we will bomb the
Speaker 2: expletive out of them. Fill in the blank. I'm sure
Speaker 2: you can figure it out. Also said back channels with
Speaker 2: officials from the Islamic Revolutionary Guard remained open, which was
Speaker 2: later denied. And then you know, we've just got kind
Speaker 2: of back and forth. There's new in Lebanon. We've got
Speaker 2: to remember Israel and their role in all of this.
Speaker 2: It's a full plate and a reminder that this war,
Speaker 2: which I think some Joe I think early on might
Speaker 2: have thought it would have ended quickly, we are now
Speaker 2: almost six months in.
Speaker 3: Yes, six months, I mean that's crazy to think about.
Speaker 2: Yeah, and some talk about this as a forever war.
Speaker 2: Let's get to our Washington round up a lot out
Speaker 2: of the nation's capital. We head to our Bloomberg News
Speaker 2: Washington DC News. You're into Bloomberg White House and Politics
Speaker 2: team leader Jordan Fabian Jordan, as always, there's a lot
Speaker 2: coming at you, guys. They are in DC. Iran in
Speaker 2: the United States, where to begin feels like we're not
Speaker 2: necessarily moving closer to an end. And yet some say
Speaker 2: it's always darkest before the dawn. How does the White
Speaker 2: House see it? What are you guys hearing?
Speaker 4: Well, we should take stock of what's happening today, which
Speaker 4: is that sixty days ago the President sat in Versy
Speaker 4: Palace and signed that Memorantium Understanding, essentially saying this is over,
Speaker 4: We're going to move toward an agreement to reopen the
Speaker 4: straight of horror moves and we're moving on. And now
Speaker 4: we're sitting here and their US is still stuck in
Speaker 4: the quagmire there. The Strait is still close to a
Speaker 4: lot of maritime traffic, restricting oil supplies, and the President
Speaker 4: has no real way out of this with Iran digging
Speaker 4: in its heels, and so the White House is saying
Speaker 4: they're going to continue with economic pressure. Scott Bessent tease
Speaker 4: some developments this week, perhaps, but it's important to remember
Speaker 4: that Iran has been under sanctions for years and it
Speaker 4: hasn't changed their behavior. So it's hard to see how
Speaker 4: this new approach quote unquote by the President is going
Speaker 4: to yield any new results.
Speaker 2: And once again we do know that we hear from
Speaker 2: the President Jordan talking about the Strait of Hormuz a territory,
Speaker 2: not the first time, right, and he chuckled. I think
Speaker 2: the first time he said it. I don't know the
Speaker 2: more time you hear it. I don't know that they think.
Speaker 2: The Iranians think it's too funny.
Speaker 4: No, he could very well do some thing reckless, do
Speaker 4: something along those lines. It's unclear to me how that
Speaker 4: would change the reality on the ground, which is that, yes,
Speaker 4: the US has opened a maritime channel south near Oman,
Speaker 4: but Iran controls the middle and the upper passages. There's
Speaker 4: still concerns about sea mines, and if the US wanted
Speaker 4: to really take control of the Straight, they would need
Speaker 4: to occupy land on the Iranian side of that waterway,
Speaker 4: and that now we're talking about a land invasion of
Speaker 4: Iran by US forces, and that would certainly mark a
Speaker 4: huge escalation of this conflict in one that the President
Speaker 4: hasn't wanted to take before. So I still think that
Speaker 4: he's essentially saying this is a tongue in cheek thing
Speaker 4: that he's labeling it the US territory, but it's not
Speaker 4: really going to mean much if there's not an increased
Speaker 4: oil flow out of that waterway.
Speaker 2: Sometimes I think he says something Joe just kind of
Speaker 2: get a feel of how people in the markets read it,
Speaker 2: But who knows.
Speaker 3: Yeah, I mean that certainly has been the case with
Speaker 3: him many times. You know, Jordan, you're in this every day.
Speaker 3: You've done this a long time, You've covered both of
Speaker 3: these his administrations. I think for people in the markets
Speaker 3: and generalists who are not necessarily you know, trading every day, right,
Speaker 3: they might just feel like this is just another headline,
Speaker 3: another part of the slog. But how can you parse
Speaker 3: what we're seeing right now as to how this is
Speaker 3: not just part of the slog, this is something new
Speaker 3: and what direction we're headed into right now?
Speaker 4: Well, Joe, it's an interesting question, and I do have
Speaker 4: a question about Trump's credibility with markets moving forward, given
Speaker 4: all the pronouncements he's made throughout this conflict about how
Speaker 4: close the deal is, and even the MoU didn't really
Speaker 4: pan out to be much. It was pretty much dead
Speaker 4: within three weeks. And even the other week he announced
Speaker 4: that he had an agreement with Hamas in Israel to
Speaker 4: disarm the militant group there, and that turned out to
Speaker 4: be nonsense. Also, it was essentially a fake deal. Hamas
Speaker 4: said that we're not going to do anything until Israel withdraws.
Speaker 4: Israel said we're not going to withdraw until hamostis arms,
Speaker 4: and we're still at square one. So it's increasingly harder
Speaker 4: to take his pronouncement seriously.
Speaker 5: You still have to.
Speaker 4: He's still the president of the United States, he still
Speaker 4: commands the world's most powerful military. But he's made a
Speaker 4: lot of pronouncements about things are going to happen that
Speaker 4: haven't really panned out.
Speaker 3: Your point on taking him seriously, I mean, how do
Speaker 3: you think right now the shijin Ping and Chinese officials
Speaker 3: are viewing this.
Speaker 4: I mean, the problem for them and for markets and
Speaker 4: people in general is that Trump has followed through on
Speaker 4: enough of his threats that you do have to take it,
Speaker 4: you know, seriously, And then the question is, like you
Speaker 4: there's always this debate about seriously versus literally is he
Speaker 4: going to follow through this time? That's a hard gamble
Speaker 4: to make. But it does appear that he's promising these
Speaker 4: things that.
Speaker 5: He can deliver.
Speaker 4: And I think that's every foreign leader that's dealing with them,
Speaker 4: whether it's Jijinping or the leaders of Iran, or even
Speaker 4: Kim Jong un. Giving this new threat on South Korea,
Speaker 4: you have to be wondering, like, what is this guy about,
Speaker 4: Like is he just gonna, you know, tear this up
Speaker 4: the minute he finds it inconvenient if you sign an
Speaker 4: agreement with him. I mean you've seen this with the
Speaker 4: trade deals he struck with US allies last year. So
Speaker 4: it's just an increasingly reckless, you know, administration, and it
Speaker 4: makes it very difficult to deal with if you're across
Speaker 4: the table from them.
Speaker 2: Yeah, it certainly keeps everybody on edge, and certainly global
Speaker 2: leaders or at least uncertain about what's next or what's real. Hey,
Speaker 2: on South Korea, let's go there.
Speaker 6: Jordan.
Speaker 2: President Trump telling the Pentagon to quote substantially reduce joint
Speaker 2: military exercises with South Korea, signing the cost of the
Speaker 2: drills and his quote very good relationship with North Korea's
Speaker 2: leader at Kim Jong un. What's the read on this?
Speaker 2: And I mean, Shana's going to be watching. We keep
Speaker 2: thinking about China, watching dwindling military and defense supplies here
Speaker 2: in the US as we continue to fight wars, the
Speaker 2: war in Iran and moving stuff around. So help us
Speaker 2: understand what we need to know here.
Speaker 4: Well, we've been hearing for a decade now about this
Speaker 4: supposed pivot to Asia that was going to happen for
Speaker 4: the United States, where the US is going to focus
Speaker 4: its power more in that region to counter China and
Speaker 4: its advances there and away from traditional hotspots like the
Speaker 4: Middle East. And this is an exhibit a of how
Speaker 4: that has failed, where you have the president bogged down
Speaker 4: in another Middle Eastern conflict that there's no end in sight,
Speaker 4: and his reason for pulling back support for South Korea
Speaker 4: is that they didn't offer him the military aid in Iran.
Speaker 4: So it's all coming back to this conflict that you know,
Speaker 4: we need to remind people he started in February and
Speaker 4: I really had no exit strategy to get out of
Speaker 4: and so you're seeing this reverb rate. Now now to
Speaker 4: South Korea, which is one of the key US allies
Speaker 4: in the region. It's a country that this administration is
Speaker 4: said they're looking to to help revive the US shipbuilding industry.
Speaker 4: How does that all affect the administration's ambitions with South
Speaker 4: Korea given this latest outburst by the president, Just.
Speaker 3: Real quickly, Jordan on the South Korea point, I mean,
Speaker 3: when we read between the lines, how should we interpret
Speaker 3: what the President is saying there?
Speaker 4: Well, he's put it pretty clearly, which is that he
Speaker 4: has value his relationship with Kim Jong un, the leader
Speaker 4: of North Korea, more than the US's his traditional alliance
Speaker 4: with South Korea. And you know this could change tomorrow
Speaker 4: the South Korean's good offer him a concession and he
Speaker 4: could say, well, I've always been friends with South Korea.
Speaker 4: Now we're going to increase the military jeels again. But
Speaker 4: it again goes to the point we were talking about
Speaker 4: earlier of reliability and if you make a deal with
Speaker 4: this administration, is the President going to keep it or
Speaker 4: is he just going to change his mind on a whim.
Speaker 4: And again it points to the increasing unreliability of the
Speaker 4: President's public statements, and it arose to those alliances.
Speaker 2: Right in the past. Doesn't necessarily indicate what might be
Speaker 2: done in the future, which makes it a little tricky
Speaker 2: for the world, so appreciate it. Jordan Fabian, White House
Speaker 2: and Politics team leader for Bloomberg News. He's there in
Speaker 2: our DC News bureau. When we come back, we're going
Speaker 2: to kind of stay on this topic more in geopolitics.
Speaker 2: Everything we discuss what it means for those all important
Speaker 2: global relationships. That's next.
Speaker 7: Stay with us. More from Bloomberg Business Week Daily coming
Speaker 7: up after this.
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Speaker 2: But to headlines, Joe and I've been talking about them.
Speaker 2: I feel like we just went over a lot of
Speaker 2: stuff with Jordan Fabian, our White House and Political team leader.
Speaker 2: Just to remind you if you're just joining us, US
Speaker 2: are on peace prospects dimming with President Trump and no
Speaker 2: hurry for a deal. He's also threatened to bomb mom
Speaker 2: On if he gets in the way of the US
Speaker 2: This is coming from Fox News. President Trump reducing US
Speaker 2: South Korea drill citing a lack of help on Iran,
Speaker 2: and then we've got just some different stories going on.
Speaker 2: It just thinks, you know, national security. I keep thinking, Joe,
Speaker 2: are we a more secure world here in the US
Speaker 2: or just globally? Are not necessarily?
Speaker 3: Wow? It really depends on who you talk to.
Speaker 2: Yeah, I don't know. Maybe if you're in a bunker far,
Speaker 2: far away, well.
Speaker 3: I mean even internally in this administration, right there are
Speaker 3: people who feel like we are not. Yeah, there are
Speaker 3: people who think we definitely are. So the divide is stark.
Speaker 2: Yeah, exactly, which is kind of what we want to
Speaker 2: tackle with our next roundtable. And lucky for us, we
Speaker 2: have with us our own Nick Wadhams, his national security
Speaker 2: reporter for Bloomberg News. He's out there in our Washington,
Speaker 2: d C. Bureau also with US and in the DC area.
Speaker 2: Mark Hansei and He's Senior Advisor Defense and Security Apartment
Speaker 2: at the Center for Strategic and International Studies. He spent
Speaker 2: time at the Office of Management and Budget, spent more
Speaker 2: than seven years as chief of the Force Structured and
Speaker 2: Investment Division. He worked on Department of events, budget strategies,
Speaker 2: and different issues. It's a great roundtable. Nick, I want
Speaker 2: to kick it off with you. I'm going to start
Speaker 2: big and broad. Are we a more secure world? Or
Speaker 2: are we less secure?
Speaker 5: Or tbd?
Speaker 2: I never give you easy questions. Do I figure it
Speaker 2: out well?
Speaker 5: Listen. I mean, if you look at the pure metrics.
Speaker 8: Of the Iran war and the Strait of Horror moves,
Speaker 8: you would have to argue that we are not. Of
Speaker 8: course President Trump would argue differently, but you had a
Speaker 8: sort of status quo prior to the US attacks.
Speaker 5: On Iran where oil was flowing through freely through the Strait,
Speaker 5: and now it's not.
Speaker 8: And this has been really one of the problems that
Speaker 8: has bedeviled the president. Of course, his administration continues to
Speaker 8: claim that it's Iran that wants a deal, that he's
Speaker 8: in no rush, but there are some suggestions.
Speaker 5: That really indicate he's growing weary of this.
Speaker 8: You also have the strain that I'm sure Mark will
Speaker 8: be able to talk about as well, on the US
Speaker 8: troops and the US assets that are in the region.
Speaker 8: And there's a lot of broad concern from US allies
Speaker 8: in Asia. You mentioned South Korea. If President Trump is
Speaker 8: now going to try to exert leverage over a country
Speaker 8: like South Korea over on, Well, what does that mean
Speaker 8: for the US A commitment to South Korea in a
Speaker 8: region where China is still looking to make its own moves.
Speaker 8: So a lot of uneasiness from US allies. Spin it
Speaker 8: back to the Western hemisphere though you have Nicholas Maduro
Speaker 8: who's been removed. The President argues that's a win. But
Speaker 8: you know, a lot of instability, a lot of concerns. So,
Speaker 8: you know, but certainly looking at Hormoz, I would say
Speaker 8: we are not as secure as we were before February.
Speaker 2: Mark Nick, as he always does, laying it also while
Speaker 2: come on in on it. I am curious too. We've
Speaker 2: talked a lot about the USS Abraham Lincoln. We've heard
Speaker 2: the President saying the deployment not nearly long enough. There's
Speaker 2: a lot of things that we could hit on. But
Speaker 2: take it away from your vantage point in terms of
Speaker 2: global national security, US national security.
Speaker 9: Well, one of the problems is how do you define
Speaker 9: US interests? Now, I agree with what we've just heard that,
Speaker 9: you know, there have been some very concerning events, straight
Speaker 9: form moves being right up there Trump administration. You know,
Speaker 9: they're much more skeptical about defending Europe. They are skeptical
Speaker 9: about even the Western Pacific and believe that countries there
Speaker 9: should do more that the United States has been taken
Speaker 9: advantage of. So from the perspective of many in the administration,
Speaker 9: we're better off because if the Europeans are threatened by Russia,
Speaker 9: that's not our problem. You know, we will be able
Speaker 9: to keep more of our forces and resources at home. Now,
Speaker 9: the concern is that we've tried that strategy twice in
Speaker 9: the past that failed both times. You know, there's no
Speaker 9: need to try it a third time. But many of
Speaker 9: the administration focused on America first, and one of the
Speaker 9: problems that I think they're realizing is that even if
Speaker 9: you have a strategy that says America first, we're going
Speaker 9: to focus on the hemisphere and the home land, we
Speaker 9: still get dragged into these foreign events like the Middle East,
Speaker 9: like Europe, like the Western Pacific. So if we're a
Speaker 9: global superpower, you know, we need to maintain those global capabilities.
Speaker 9: And right now we're seeing that the Navy is stretched
Speaker 9: and our ammunitions inventories are much lower than the war
Speaker 9: planners would like.
Speaker 3: Yeah, Mark, I mean you're really moving towards. In my estimation,
Speaker 3: here is this ongoing discussion of the US weapons stockpile.
Speaker 3: You know, I've talked about this with Nick plenty of times,
Speaker 3: but it seems like right now the administration is a
Speaker 3: bit sensitive to this discussion. And I'm just curious what
Speaker 3: you think you know and telling our viewers who maybe
Speaker 3: aren't paying as much attention to the weapons aspect. Is
Speaker 3: it a dire situation, is it a troubling situation? Where
Speaker 3: do you benchmark this at?
Speaker 9: I would put it at troubling, But you have to
Speaker 9: keep in mind that munitions covers a lot of territory,
Speaker 9: and there are some munitions where we have good stockpiles.
Speaker 9: For example, we're rebuilding stockpiles for ground munitions for and
Speaker 9: there are some short range ground attack munitions that we
Speaker 9: have pretty good stockpiles on. But there are other areas
Speaker 9: where we are short. The one place where we're really
Speaker 9: desperately short is defenses against ballistic missiles. And these are
Speaker 9: systems like Patriot, which many people have heard of AD
Speaker 9: and the Navy's SM three. We've used about half of
Speaker 9: those Patriot little more SM three a little less, and
Speaker 9: there are no good alternatives.
Speaker 3: Because, like I said, like a level those is it
Speaker 3: like a level that keeps you up at night?
Speaker 9: That would keep me up at night? Now you know,
Speaker 9: we have alternatives to some of the other munitions, and
Speaker 9: there are some things that have come out of the
Speaker 9: war that I think do help the torrents against China.
Speaker 9: But this is the this is an area where we
Speaker 9: are short. It's going to take a long time to
Speaker 9: read buildbos and there are no good substitutes.
Speaker 2: So Nick, come on in on here. You know, you
Speaker 2: cover national security from so many different angles, but let's
Speaker 2: go to our military stockpile and what you're hearing because
Speaker 2: the administration and I guess I understand it on some level,
Speaker 2: it's very defensive, no pun intended when it comes to
Speaker 2: any criticism about the size of military stockpiles. What do
Speaker 2: we know for real? And I do understand we have
Speaker 2: to keep some of this quiet because it is a security.
Speaker 5: Issue, right.
Speaker 8: I mean, it's very interesting because having covered US wars
Speaker 8: going back to Iraq in the early two thousands, I mean,
Speaker 8: as a reporter, I was used to constant daily, incessant
Speaker 8: briefings from the administration, certainly putting their spin on the
Speaker 8: state of US forces, number of casualties, territory.
Speaker 5: Stockpiles, things like that.
Speaker 8: And while a lot of this was considered a secret,
Speaker 8: you could get some estimation of where things stood. And
Speaker 8: this administration has taken a much different approach. It's much
Speaker 8: more difficult even to get assessment of damage on US
Speaker 8: bases in the region that have been hit by Iranian attacks.
Speaker 8: So there is so much that we don't know. What
Speaker 8: we can say, though, is that some of our reporting
Speaker 8: does suggest that the administration is making decisions partly because
Speaker 8: of concerns around stockpiles. So when you had the President
Speaker 8: essentially prompt missing to unleash a massive new military campaign
Speaker 8: against Iran a couple of weeks ago, and then the
Speaker 8: reporting suggested that US allies in the region were telling him, listen,
Speaker 8: we do not think this is the best path forward.
Speaker 8: We did have some indication at that time that concerns
Speaker 8: around strikes on US allies in the region Saudi Arabia, Bahrain,
Speaker 8: United Arab Emirates Cutter, for example, that the US understood
Speaker 8: it would not be able to defend them as well
Speaker 8: as it would want to because of concerns around its
Speaker 8: ability to knock down all of those incoming strikes from Iran.
Speaker 8: So it's a very complicated picture. There's a lot at play,
Speaker 8: there's a lot we don't know, but we can at
Speaker 8: least say that the evidence we're getting from the reporting
Speaker 8: does suggest that concerns around those stockpiles are starting to
Speaker 8: influence the way the administration does make decisions in the
Speaker 8: region about what it'll do next.
Speaker 3: And Nick, when you say not be able to defend
Speaker 3: our allies in the region as much as we'd want to,
Speaker 3: can you unpack that for listeners who maybe don't really
Speaker 3: understand the day to day of what you might be
Speaker 3: talking about.
Speaker 8: Well, I mean it's like what Mark said, I mean,
Speaker 8: if there's a ballistic missile that comes in, I mean,
Speaker 8: that's a very powerful weapon, and if it can't be
Speaker 8: defended against because there's a shortage of patriot missiles or
Speaker 8: they're being much more selective about their targeting, those sort
Speaker 8: of targeting decisions are going to be influenced based on
Speaker 8: your stockpiles. I mean, the US is starting to get
Speaker 8: into other forms of defense. They're not effective against ballistic missiles,
Speaker 8: but against against incoming drones. So they do have more
Speaker 8: counter drone defenses, and there are indications that they're ramping
Speaker 8: up production of those Patriot missiles. Of course, of course
Speaker 8: those take months or years to produce, but they are
Speaker 8: bringing in cheaper anti drone defenses. They're working on directed
Speaker 8: energy weapons. There's all sorts of stuff they're trying to
Speaker 8: bring to the region to defend against Iranian attacks. But
Speaker 8: the Uranian attacks are so varied, and the time lag
Speaker 8: between when you expend those munitions and then can resupply them.
Speaker 8: You know, if it's a cheap drone, okay, that's one thing.
Speaker 8: But if it's a pack three you know, Patriot interceptor,
Speaker 8: you know, those take years to produce and they cost,
Speaker 8: you know, millions of dollars, so there's a much longer
Speaker 8: time horizon to get those into the battlefield to be
Speaker 8: able to defend the US forces.
Speaker 9: Yep.
Speaker 2: Can't flip a switch quickly on that one. Hey, Mark,
Speaker 2: I want to go back to you for a moment.
Speaker 2: One of the things I keep thinking about with any
Speaker 2: of this is that I do feel like the cards
Speaker 2: are largely in the hands of the Iranians, and we
Speaker 2: did a President Trump come out on social this morning.
Speaker 2: The number one goal is and always will be that
Speaker 2: Aron cannot have in any way, shape or form a
Speaker 2: nuclear weapon. So we're back to that as the mission,
Speaker 2: which is what we all thought that mission was in
Speaker 2: the beginning, but it's kind of gotten tossed around here.
Speaker 2: From the Iranian perspective, this is existential for them. So
Speaker 2: what do we need to understand about where they are
Speaker 2: coming from and how long they're willing to keep this
Speaker 2: going again, going to what some say will be a
Speaker 2: forever war between the US and Iran.
Speaker 9: Well, I think that's right for the Iranian regime. This
Speaker 9: is an existential threat that the Israelis in the United
Speaker 9: States have threatened to overthrow the regime. Now the focus
Speaker 9: is back on nuclear weapons, but regime change would certainly,
Speaker 9: you know, was certainly discussed early early on, and the
Speaker 9: regime is willing to endure great hardship. They're willing to
Speaker 9: inflict great hardship on the population in order to stay
Speaker 9: in power. You have to keep in mind too, that
Speaker 9: there's a religious element here. You know, It's not just
Speaker 9: that there's a regime that wants to retain power, as
Speaker 9: all regimes do. They believe that God has entrusted them
Speaker 9: with certain responsibilities and they need to carry those out.
Speaker 9: Both sides have cards. The Iranians, of course, are blockading
Speaker 9: the Straight. The US is blockading the Straight also and
Speaker 9: preventing Ranian oil from going out and materials coming in.
Speaker 9: We are in what I call it economic war of
Speaker 9: attrition to see who can endure longer, who can force
Speaker 9: the other side to make concessions.
Speaker 3: Mark, I want to flip the switch to the comments
Speaker 3: the President had made over the weekend about the US
Speaker 3: South Korea drills, wanting to reduce those setting a lack
Speaker 3: of help on Iran. From your perch, when you hear
Speaker 3: something like that, I mean, what kind of goes off
Speaker 3: in your mind?
Speaker 9: From a military perspective, this is a bad thing. Now,
Speaker 9: It's not an immediate problem the way that rediction forces
Speaker 9: might be, for example. But these exercises, and the big
Speaker 9: one is coming up. It's called Olgi Freedom Guardian. It's
Speaker 9: been going on for literally fifty years.
Speaker 6: Year.
Speaker 9: When I was in the Marine Corps, i participated. But
Speaker 9: this is a mechanism to get the US forces in
Speaker 9: South Korean forces working together to mesh the two military systems,
Speaker 9: to make sure our plans are consistent, to make sure
Speaker 9: that all of our communications is consistent, that we can
Speaker 9: fight together as a team effectively, and is also on
Speaker 9: the South Korean side of mobilization aspect to the operation. Now,
Speaker 9: you cancel it one year and you lose some experience,
Speaker 9: but there's still a lot of experience in the force.
Speaker 9: But over time, as you cancel that, you cancel the
Speaker 9: smaller exercises, that expertise declines, your credibility with the North, declines,
Speaker 9: your military capabilities to conduct combined operations of conflict with
Speaker 9: the United States and South Korea. That declines. And it's
Speaker 9: not clear to me what we're getting for it. Something
Speaker 9: offered anything, So I'm not sure you know what's in
Speaker 9: it for us, But I'll defer to the political side
Speaker 9: to answer that question.
Speaker 2: All right, Nick, come on back in here. In that
Speaker 2: social post to President Trump said South Korea had declined
Speaker 2: to join us in the nuclearization of the Islamic Republic
Speaker 2: of Iran. It did catch soul though by surprise this
Speaker 2: is just another thing, or how are you and the
Speaker 2: folks you talked to kind of assessing this latest move,
Speaker 2: which many say caught Soul by surprise, right.
Speaker 8: I think it probably caught a lot of Trump's most
Speaker 8: senior advisors by surprise as well.
Speaker 5: I mean, there is some president for this.
Speaker 8: When the administration in Trump's first term was in negotiations
Speaker 8: with North Korea, the president scaled back US military exercises
Speaker 8: with South Korea. It also gotten a big in broglio
Speaker 8: with South Korea over the amount the US wanted South
Speaker 8: Korea to pay for US troops hosted on its soil.
Speaker 5: So there was a lot of conversations.
Speaker 8: It was seen as sort of leverage the administration was
Speaker 8: trying to use for to renegotiate those basing agreements to
Speaker 8: get what President Trump believed was a better deal. So
Speaker 8: when I see that, a lot goes through my mind. Okay,
Speaker 8: maybe it's Iran. Maybe it's the basing agreements that they
Speaker 8: have some more time to go there. Maybe we'll also
Speaker 8: get back into some sort of conversation with Kim Jong
Speaker 8: un in North Korea. You know, the white whale of
Speaker 8: President Trump's first term an agreement with North Korea.
Speaker 5: Maybe he's going to make another run at it.
Speaker 8: So it's always difficult to divine, you know, on a
Speaker 8: Sunday evening, where these pronouncements come from, though it does
Speaker 8: have some historical president president for President Trump. Though I
Speaker 8: do agree with Mark there on the question of, you know,
Speaker 8: what does the US get out of this? How does
Speaker 8: what help does President Trump actually want from South Korea
Speaker 8: in helping with Iran. Maybe it's maritime patrols for the
Speaker 8: Straight of Horn moves, but it's hard to see how
Speaker 8: South Korea could actually help with denuclearization of Iran.
Speaker 5: Maybe it's just diplomatic support.
Speaker 8: So again, a lot we don't know here, and we'll
Speaker 8: really have to see how much he actually scales back
Speaker 8: those drills when it comes down to it.
Speaker 2: Just another issue, right, I have to pull into kind
Speaker 2: of the geopolitical conversations. You both are gems. Thank you
Speaker 2: so much as always, Nick Wadams, He's Bloomberg News national
Speaker 2: security reporter out there in our DC bureau, Marcansi, and
Speaker 2: thank you as well, Senior Advisor Defense and Security Department
Speaker 2: at the Center for Strategic and International Studies. I mean,
Speaker 2: it is, right, always, just another layer on top of things,
Speaker 2: and whether or not it's significant or whether it was
Speaker 2: just a statement or tweet or social post by the president.
Speaker 2: I mean that's what investors, the world at large, global
Speaker 2: leaders and companies have to figure.
Speaker 3: Out every weekend. Nick and I are exchanging emails on
Speaker 3: the latest comments made by the president or someone in
Speaker 3: his cabinet about these things, and you have to be
Speaker 3: quick to parse it.
Speaker 2: Yeah, exactly, because sometimes it impacts the market, sometimes it
Speaker 2: impacts the narrative in a big way, and sometimes it doesn't,
Speaker 2: which is all another fascinating aspect to all of this.
Speaker 7: Stay with us. More from Bloomberg Business Week Daily coming
Speaker 7: up after this.
Speaker 1: You're listening to the Bloomberg Business Week Daily Podcast. Catch
Speaker 1: us live weekday afternoons from two to five e's during
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Speaker 2: Hey a Gulf Stream, a three hundred and sixty seven
Speaker 2: billion dollar asset management firm, not too shabby an effort
Speaker 2: to revive the Wooly Mammoth. I had no idea ownership
Speaker 2: of a storied, iconic NBA team until last week. A
Speaker 2: steak in Chelsea Football Club and a federal probe and
Speaker 2: the financial troubles that a followed that led to a
Speaker 2: possible sale of that Chelsea Football Club, and it did
Speaker 2: lead to a sale of the La Leakers that we
Speaker 2: learned last week. This is the life of the CEO
Speaker 2: of Guggenheim Partners as he rushes a makeover a mid
Speaker 2: it all talk about a full plate. It is today's
Speaker 2: Bloomberg Big Tay, and joining us is Srinatarajan, Ploomberg News
Speaker 2: Chief Wall Street correspondent Here in studio Shre, I feel
Speaker 2: like we've seen these stories before, these people that achieve
Speaker 2: incredible levels of success and then they either stumble or
Speaker 2: kind of fall from on high. He's got a full plate?
Speaker 5: Where is he?
Speaker 2: And tell us about the things that he's kind of
Speaker 2: dealing with.
Speaker 10: Okay, the whole storyline is interesting because of who he is,
Speaker 10: Mark Walter Right. It's not just a name that you
Speaker 10: would recognize on Wall Street, which he would because on
Speaker 10: Wall Street you have his giant asset manager, Google Name Investments,
Speaker 10: his broker dealer that's run by the former Bearston CEO,
Speaker 10: Alan Schwartz, but also a name that should be known
Speaker 10: on Main Street and has bled through to that space
Speaker 10: because in his stable of sports team are the Dodgers,
Speaker 10: the Chelsea Football Club, Lakers, Cadillac F one team, the
Speaker 10: professional women's hockey league where the winner plays for the
Speaker 10: Walter Cup. So here is someone who's at that intersection
Speaker 10: of Main Street and Wall Street. So when you have
Speaker 10: this sort of money trouble that pops up, and when
Speaker 10: we and money trouble is perhaps a very loose term
Speaker 10: for what is happening right now, because he also owns insurers,
Speaker 10: and as the FEDS probe how these insurers made loans,
Speaker 10: whether they made loans to affiliated assets or not, it's
Speaker 10: clearly raised the temperature a little bit. All our reporting
Speaker 10: shows that he has been accelerating in rushing efforts to
Speaker 10: try and clean up that insurance balance sheet, but the
Speaker 10: spillover effect of that, as a result of that, you
Speaker 10: are seeing some big ticket, important trophy assets being taken
Speaker 10: away from him potentially. Today's new story talks about the
Speaker 10: Chelsea Steak going to another Chelsea owner, clear Lake. No
Speaker 10: deals there, but the talks are happening, and they seem
Speaker 10: to be happening in the last few days. Last week,
Speaker 10: you had that surprise sale of the Los Angeles Lakers.
Speaker 10: The headline figure says a twelve point five billion dollar
Speaker 10: record breaking sale. Sounds great, but when was the last
Speaker 10: time you've heard of a profession sports team like that
Speaker 10: of that stature getting flipped in less than a year,
Speaker 10: as if it was some Jersey Shore mansion.
Speaker 2: Hey watch that Jersey, Hey I throw I went to
Speaker 2: school in New Jersey, Florida.
Speaker 11: I don't forget that.
Speaker 3: Thank you?
Speaker 2: All right, So, as you dig into this story, I
Speaker 2: do wonder, is this the guy who stumbles and falls
Speaker 2: and then is gone? Or is he a mean he's
Speaker 2: got so many coveted assets? Is this enough? But then
Speaker 2: when you've got also a federal probe, you do wonder
Speaker 2: what's the implications longer term?
Speaker 3: Right?
Speaker 10: The implications on what's happening to your cabinet of assets, right,
Speaker 10: whether that grows or you know, shrinks, is one thing.
Speaker 10: What happens to a federal probe is a whole another thing.
Speaker 10: So I don't know we can if we can square
Speaker 10: away the two. Right now, we are obviously seeing as
Speaker 10: they try and remediate the issue with his insurance firms,
Speaker 10: and again to explain to our listeners and viewers what
Speaker 10: exactly the issue is is Mark Walter owns an insurance firm.
Speaker 10: Through that insurance firm, they were getting loans to fund
Speaker 10: other parts of Mark Walter's sprawling empire. The problem was
Speaker 10: a lot of those loans were tagged as unaffiliated. When
Speaker 10: they did a review, they suddenly said, at least one
Speaker 10: of the bigger insurance, Delaware Life that he owns, said,
Speaker 10: our affiliated assets have gone up from three percent to
Speaker 10: forty percent after we did some checks. And why did
Speaker 10: they do the checks Because the gods of penas from
Speaker 10: the Feds. So the problem is real and he'll have
Speaker 10: to find a way to get through that. Again, it's
Speaker 10: a federal probe that matters, and we're all paying attention
Speaker 10: to see where that goes. But you are seeing the
Speaker 10: dynamic of that in some of these big asset sale
Speaker 10: and discussions.
Speaker 3: You know, this is a story that, like every day,
Speaker 3: there's some new scoop coming out from us or from others.
Speaker 3: It just does not go away. Can you kind of
Speaker 3: dive into that aspect? Coupled with the you sitting down
Speaker 3: and saying, you know what, let's just do a quick
Speaker 3: let's do a profile of this man. Let's explain to
Speaker 3: people who are are interested, both in the sports world
Speaker 3: and the finance world, who he is and catching them
Speaker 3: up to speed and knowing this is maybe just the beginning.
Speaker 10: And that's always a challenge with the fast moving news cycle.
Speaker 10: There are a lot of developments happening, and you will
Speaker 10: find news interest in different corners of that empire, just
Speaker 10: because of all that he owns. How often do you
Speaker 10: see Sportico and the New York Times Sports section and
Speaker 10: Bloomberg and the Financial Times on the Wall Street Journal
Speaker 10: focusing on the same subject, focusing on the same person.
Speaker 10: That is exactly what's happening right now, but also an
Speaker 10: interesting life story. We all know him for that Gougenheim name.
Speaker 10: He has nothing to do with that great American dynasty.
Speaker 10: He's not a direct descendant. It was a chance meeting
Speaker 10: where Mark Walter was running a financial firm in the
Speaker 10: backwaters of Chicago, or at least in the financial backwaters
Speaker 10: in Chicago, to be clear, and had this meeting with
Speaker 10: a great grandson of the original Gougenheim baron, the mining
Speaker 10: Baron Meyer. Gugenheim turned that partly that into this big
Speaker 10: empire that he has because he folded his firm into
Speaker 10: that family office, Gugenham family office. And really, when you
Speaker 10: think of Googenem today, you think of this man who
Speaker 10: grew up in Cedar Rapids, Iowa, son of a factory worker,
Speaker 10: had nothing to do with that great dynasty, but that's
Speaker 10: the name you think of. And then over time that
Speaker 10: has it's expanded. You have the Dodgers, Lakers, and all
Speaker 10: these other teams. Last month, he was getting feted at
Speaker 10: the Rose Garden by President Donald Trump, where the President
Speaker 10: calls him my friend. Mark Walter then compare him to
Speaker 10: George Steinbrenner, famous for his win at all cost mentality. Again,
Speaker 10: Steinbrenner rest in peace was a polarizing figure. So it's
Speaker 10: not really clear to me whether Mark Walter would have
Speaker 10: heard that comparison and been happy about it or not
Speaker 10: so thrilled.
Speaker 2: We've only got about a minute left here and there.
Speaker 2: You know, in the story, it's like he talks about
Speaker 2: I hate losing. He said this back in twenty twenty
Speaker 2: four next to Laker's legend and turn business alheimh Magic Johnson.
Speaker 2: I just can't stand it, yes, says I reduced to
Speaker 2: being poor and happy. Then I just got in business
Speaker 2: and was competitive and things worked out. I mean, what
Speaker 2: is it in kind of digging into his past and
Speaker 2: understanding a little bit about who he is and what
Speaker 2: he's about that really just struck you, as he is
Speaker 2: really kind of fighting for his I don't want to
Speaker 2: say fighting for his life, and I'm more with drama,
Speaker 2: but what he does will determine kind of where this goes.
Speaker 10: More importantly, what happens with the federal probe will determine
Speaker 10: what his legacy and standing will be. And it's not
Speaker 10: like in the past the Feds haven't tried to look
Speaker 10: at other aspects of his business empire. The SEC in
Speaker 10: years passed at various stages without bringing any cases, without
Speaker 10: accusing anyone of wrong ring, but at least had explored
Speaker 10: various investigations that looked at elements of conflicts of interest.
Speaker 10: That is what this current probe also seems to at
Speaker 10: least recof It seems to have some of the same flavors.
Speaker 10: But really the outcome of this probe will tell us
Speaker 10: how we'll see history. Is he, at the end of
Speaker 10: the day, the epitomy of that true great American dream, right,
Speaker 10: you know, from nothing to become one of America's great
Speaker 10: wealthy as financiers?
Speaker 2: Yeah?
Speaker 10: Is it financial ingenuity or something worse? And we'll have
Speaker 10: to wait to see what that is.
Speaker 2: Highly recommend this is one of the stories that Sri
Speaker 2: You and the team always just do so well. It's
Speaker 2: on the Bloomberg. It's on Bloomberg dot com. Thank you,
Speaker 2: Thank you. It's a great Monday. Read Sanataraja on Bloomberg News,
Speaker 2: Chief Wall Street Correspondent.
Speaker 7: Stay with us. More from Bloomberg Business Weekdaily coming up
Speaker 7: after this.
Speaker 1: You're listening to the Bloomberg Business Week Daily Podcast. Catch
Speaker 1: us live weekday afternoons from two to five eas during it.
Speaker 1: Listen on Applecarplay and Android Auto with the Bloomberg Business app,
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Speaker 2: All right, so there's a lot going on in terms
Speaker 2: of geopolitics and how it impacts things like supply chains
Speaker 2: and just kind of the global grab for so much
Speaker 2: and how it impacts different economies. And when we were
Speaker 2: planning for the show, we knew you were going to
Speaker 2: be here. You're like, I've got a perfect guest.
Speaker 3: That's right, that's right. We are fortunate enough to bring
Speaker 3: in someone I've known for a little while now, Peter Herrel.
Speaker 3: He's the visiting scholar at the Georgetown Institute of International
Speaker 3: Economic Law. He's also a former Biden, a White House
Speaker 3: Senior Director for International Economics, and he's joining us from Washington,
Speaker 3: d C. Peter, thanks for coming on.
Speaker 11: Joh thanks for having me on. It's a real pleasure.
Speaker 3: So Peter one of the things I wanted to dive
Speaker 3: in is you have been writing quite a bit about
Speaker 3: the latest grouping of trade tears that have been coming
Speaker 3: out in the section two thirty two's and all the others.
Speaker 3: You've been talking about budget deficits. I feel like in
Speaker 3: the backdrop of all of this, hanging over these massive
Speaker 3: trade and economic questions, is this ongoing war with Iran.
Speaker 3: And I'm just wondering is that fair to say? Is
Speaker 3: it fair to say that the war in Iran is
Speaker 3: actually maybe causing a bit more of a policy problem
Speaker 3: for this current White House over all these other trade
Speaker 3: and economic issues that you've running amount.
Speaker 6: Yeah, well, Joe, first of all, thanks for having me on.
Speaker 6: And I think it's a really important question. I do
Speaker 6: think we are seeing some interplay between the war in
Speaker 6: Iran and the White House, the White House's terif agenda,
Speaker 6: you know, as I think of it. On the war
Speaker 6: in Iran, we're in kind of the phase of this
Speaker 6: war where it is a war.
Speaker 11: Of economic attrition on both sides.
Speaker 6: Right the Trump administration is naval imposing a naval blockade
Speaker 6: on Iran's oil exports. Iran is trying to reduce global
Speaker 6: oil exports from the Gulf by keeping the straight of
Speaker 6: horror moves closed, and that is keeping energy prices elevated
Speaker 6: at least where they were at the beginning of the year.
Speaker 6: Going into a midterm, we are in a higher oil
Speaker 6: price environment, which is politically challenging for the president. And interestingly,
Speaker 6: one thing you see the President having done over the
Speaker 6: last month or so is having made a decision not
Speaker 6: to take US teriff rates all the way back to
Speaker 6: where they were at the beginning of this year before
Speaker 6: the Supreme Court ruled his first round of tariffs illegal.
Speaker 6: So you know, his average teriff rate at the beginning
Speaker 6: of the year was maybe about fifteen percent or so.
Speaker 6: After the Supreme Court that fell to about ten percent.
Speaker 11: They have said, you know, they said at the.
Speaker 6: Time, we're going to fully recreate these tariff rates, but
Speaker 6: they haven't actually done, so they've kind of kept them
Speaker 6: more in that ten to eleven percent range. And I
Speaker 6: do think that's because the war in Iran has made
Speaker 6: energy prices in thus inflation run a little bit hotter
Speaker 6: than it otherwise would have. And I do think that's
Speaker 6: you know, we still have tariff man for a president.
Speaker 6: We got to be direct about that. But I do
Speaker 6: think that has made them a little bit more cautious
Speaker 6: about fully reimposing that full tariff rates they had before
Speaker 6: the Supreme Court ruled in February.
Speaker 3: So more of a practical approach this time than maybe
Speaker 3: what we saw about a year year and a half ago. Peter, Yeah,
Speaker 3: I think that's correct.
Speaker 6: I actually think one of the stories of Trump tariffs
Speaker 6: over the course of really starting late last year, is
Speaker 6: that beneath the headlines, beneath the president who continues to
Speaker 6: want to talk about tariffs lean into tariffs, beneath those headlines,
Speaker 6: you have begun to see the Trump administration take a
Speaker 6: more practical approach. You know. So, as I say, he
Speaker 6: has not fully recreated the tariffs the sort of high
Speaker 6: tariff rates that he had earlier this year, I don't
Speaker 6: want to minimize them. They're still several times higher than
Speaker 6: they were when he came in, but you know, they
Speaker 6: are a couple of percentage points lower. But we've also
Speaker 6: seen him take often quiet, you know, sometimes on Friday afternoon,
Speaker 6: take measures to exempt different kinds of price sensitive products
Speaker 6: from the tariffs. Right so late last year, earlier this year,
Speaker 6: they exempted a bunch of food stuffs, from the tariffs
Speaker 6: to try to take some of that price pressure off.
Speaker 6: They have very quietly, you know, made sure that they
Speaker 6: are exempting farm and fertilizer inputs, did that earlier this spring,
Speaker 6: so you know, again they want to be able to
Speaker 6: talk about tariffs. It is a very aggressive tariff regime
Speaker 6: compared to what we've seen in recent years, but I
Speaker 6: think they have pivoted to be a little bit more
Speaker 6: pragmatic than they were, you know, kind of peaked tariff
Speaker 6: last spring last summer.
Speaker 2: Peter, we mentioned in the intro to you that you
Speaker 2: worked with the Biden administration White House senior director for
Speaker 2: International Economics. I do wonder if you think now that
Speaker 2: in terms of international economics, you look around the world,
Speaker 2: are we in a completely new era, and whether it's
Speaker 2: tariff's investments in companies, governments taking investments in companies on shoring,
Speaker 2: that we are whoever is in the White House, whatever
Speaker 2: happens in the midterms, he's ever in the White House
Speaker 2: next that this is our new era when it comes
Speaker 2: to what companies and countries are doing to kind of
Speaker 2: protect themselves.
Speaker 11: I think we are.
Speaker 6: In a quite different era, certainly at a policy level,
Speaker 6: and we talked about tariffs. You bring up another very
Speaker 6: important point on government equity investments. I think this is
Speaker 6: often underappreciated by the public here in the US. You know,
Speaker 6: the Trump administration has taken it's either thirty five or
Speaker 6: thirty seven different equity stakes with a market value of
Speaker 6: sixty or seventy billion dollars today, just on a straight
Speaker 6: line trajectory, we're probably looking at by the end of
Speaker 6: the Trump administration. I don't know, you know, one hundred
Speaker 6: to two hundred equity stakes, one hundred to two hundred
Speaker 6: billion in market cap.
Speaker 11: Like this is very different from what we have.
Speaker 6: Seen in the past, and I do think we are
Speaker 6: in a new era when it comes to policy, whether
Speaker 6: it's trade policy and tariffs, whether it is this sort
Speaker 6: of supply chain policy, whether it is these these these
Speaker 6: equity investments. I think there's still an open question about, Okay,
Speaker 6: we have a very different policies, but what is this
Speaker 6: going to do on the data? Because you know, for
Speaker 6: all the tariffs that were imposed over the last year,
Speaker 6: year and a half, the US trade deaf as it
Speaker 6: was basically it has basically been unchanged over the last
Speaker 6: six months pretty well. You know, I think we have
Speaker 6: to be realistic that policy is changing. The data has
Speaker 6: not yet caught up with the policy changes.
Speaker 2: But can I just just real quickly, like twenty thirty seconds,
Speaker 2: whoever is next in the White House? Do you think
Speaker 2: these kind of policies continue If it's a Democrat, if
Speaker 2: it's a socialist, if it's a communist, who knows. But
Speaker 2: I mean, there will continues.
Speaker 6: There will certainly be differences with the next president.
Speaker 11: But I do think we.
Speaker 6: Are in a structurally higher tariff environment than we were
Speaker 6: a couple of years ago. And I do also think
Speaker 6: this kind of idea of a more activist, interventionist government
Speaker 6: in markets is going to be here to stay. Though
Speaker 6: whether it partly rolls back, I think is an open question.
Speaker 3: I feel like there's a book in there for you, Peter.
Speaker 3: There's so much on the table for this, But I
Speaker 3: do want to pivot. We have we have the meeting
Speaker 3: from Xijinping, the president of China, that's supposed to be
Speaker 3: coming up in the next month with Donald Trump, the
Speaker 3: President of the United States. All of this tariff discussion,
Speaker 3: you know, like you said, we've seen polysilicon tariff announcement
Speaker 3: come out, drone tariff come out. All of this is
Speaker 3: slowly coming out ahead of that meeting. How do we
Speaker 3: position the importance of that meeting and what we're seeing
Speaker 3: from this White House right now in the weeks leading
Speaker 3: up to it.
Speaker 6: Yeah, it is interesting to me that we have seen
Speaker 6: some continued action again that is clearly focused on China,
Speaker 6: even if sort of the stated reason is more general. Right,
Speaker 6: it wasn't Chinese polysilicon tariffs, it was polysilicon dariffs, but
Speaker 6: this is really all about China. Similarly, similarly, we have
Speaker 6: seen the Federal Communications Commission, you know, roll out some
Speaker 6: bans on robots, on power inverters. These are also not
Speaker 6: stated to be about China, but are about China. It
Speaker 6: has been interesting to me to see the Trump administration
Speaker 6: continue to put some pressure.
Speaker 11: On China in advance of the she meeting.
Speaker 6: You know, sometimes you think, oh, there'll be a period
Speaker 6: of quiet before a summit like that to keep the
Speaker 6: diplomatic waters calm. The Trump administration has clearly been willing
Speaker 6: to put some chips on the table in advance of
Speaker 6: that meeting. I think what will be interesting to see
Speaker 6: is does does the Trump administration negotiate any of this
Speaker 6: away or are they setting a new baseline going into
Speaker 6: that negotiation, that negotiation with she to say, hey, this
Speaker 6: is what we've done. You know, we're only going to
Speaker 6: be talking about the future.
Speaker 2: Well, you know, on that, I just want to throw in.
Speaker 2: I mean, the US planning to warn dozens of countries
Speaker 2: that would shut out of a US led AI coalition
Speaker 2: if they sun into a similar framework proposed by China.
Speaker 2: This is coming out of Reuters. I mean, yeah, is
Speaker 2: it just US reminding China of potentially the power they
Speaker 2: can still wield? Are they serious about this? I mean,
Speaker 2: this is one of the big races and wars of
Speaker 2: our time. It feels like and I think the.
Speaker 6: Trump administration well, I think the Trump administration is internally
Speaker 6: divided sometimes about they want the decoupling with.
Speaker 11: China to go.
Speaker 6: Clearly on AI, they are quite committed to an aggressive
Speaker 6: American pre eminence posture. We've seen that with their you know,
Speaker 6: kind of diplomatic initiatives. We've seen that with their kind
Speaker 6: of accelerationist posture, putting aside the issues with US recently
Speaker 6: with anthropic on model safety. But they clearly want to
Speaker 6: have an accelerationist posture here Visa v.
Speaker 11: China on AI.
Speaker 6: That said, I do think both Trump and She will
Speaker 6: want to talk about AI next month at Mara a Lago,
Speaker 6: and I won't be surprised if we see at least
Speaker 6: some rhetorical talk around cooperation on safety and the like.
Speaker 6: I don't think that's necessarily mutually exclusive. I think the
Speaker 6: US would like have those negotiations from kind of a
Speaker 6: position of strength, But I do think there will be
Speaker 6: some desire to cooperate on some for safety principles.
Speaker 3: Just as a quick one though, Peter. I mean there's
Speaker 3: a lot of concern in the circles that I speak
Speaker 3: to and the circles that you run in as well,
Speaker 3: that this is a tough meeting for Donald Trump because
Speaker 3: in the minds of a lot of folks who've been
Speaker 3: around this space for a long time, they feel like
Speaker 3: Hijinping holds a lot more cards than the President of
Speaker 3: United States does at this moment. Do you think that
Speaker 3: is fair directionally?
Speaker 6: I think both governments here hold quite a bit of
Speaker 6: quite a number of cards. Like clearly the Chinese continue
Speaker 6: to hold a lot of leverage through their control of
Speaker 6: Yer Earth. So Trump administration is trying to reduce US dependencies,
Speaker 6: but that's a two to three year, four year kind
Speaker 6: of play. The Chinese continue to have a lot of
Speaker 6: leverage there. Clearly, Actually the Chinese. We talked about oil
Speaker 6: markets earlier, like the Chinese have actually been incredibly helpful
Speaker 6: in keeping oil prices from going even higher because they've
Speaker 6: been releasing enormous amounts from stock files.
Speaker 11: I think President Trump is going to want that to continue.
Speaker 11: I think the Chinese have a lot of cards.
Speaker 6: Of course we do too, right, We continue to have
Speaker 6: a lot of cards on the financial domain and the
Speaker 6: technology domain in the life.
Speaker 2: Yeah, I would love to be a fly on the wall.
Speaker 2: It's like that ultimate frenemy relationship. Peter, you rock. This
Speaker 2: was really fun. Thank you so much. Peter Heraw Visiting
Speaker 2: Scholar at Georgetown Institute of International Economic Law, former Biden
Speaker 2: Whitehouse Senior Director for International Economics. Great to have him here.
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