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Speaker 1: Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keane Jay Ley.

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Speaker 1: We bring you insight from the best in economics, finance, investment,

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Speaker 1: and international relations. Find Bloomberg Surveillance on Apple Podcasts, SoundCloud,

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Speaker 1: Bloomberg dot Com, and of course on the Bloomberg. Oh boy,

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Speaker 1: another politician out with a book. Yeah, except Vince Cable

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Speaker 1: is like I have never seen before. Hit the ball

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Speaker 1: out of the park. Writing three and even four years ago.

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Speaker 1: He opens Open Arms June seven of two thousand nineteen

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Speaker 1: Into the future, Indian sources report a border incident on

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Speaker 1: the line of control. In cash Mirror, Mr Cable joins

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Speaker 1: us today. Vince first of all can graduations and getting

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Speaker 1: out in front of the news is I have never

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Speaker 1: ever seen in fiction? How did you do that? Well,

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Speaker 1: it's it's it's a political thriller and a love story,

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Speaker 1: and it's set in the UK. But I have a

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Speaker 1: longstanding association with India and I first first went there

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Speaker 1: over half a century ago. I have Indian in laws.

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Speaker 1: I love the country and I'm aware of how important

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Speaker 1: it is, but also of the dangers of conflict. And

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Speaker 1: you have these two nuclear powers, you have a big

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Speaker 1: division based on religion, and of course those divisions are

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Speaker 1: reflected in British society because we have a large form

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Speaker 1: Pakistan former India population. And I set my drama around

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Speaker 1: an arms contract between Britain and India. At your post Brexit,

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Speaker 1: Britain's trying to push arms exports and we we find

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Speaker 1: ourselves in the middle of that historic conflict, which remarkably

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Speaker 1: has remained subdued for for many years, and give them

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Speaker 1: the potential for damage. What do we misunderstand? So this

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Speaker 1: is a thriller. Yesterday we you know, we saw the

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Speaker 1: tensions unfold actually in real time, and we've covered it

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Speaker 1: extensively here on Bloombridge surveillance between Indian Pakistan. But what

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Speaker 1: do we misunderstand about the shift in geopolitics around the world. Well,

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Speaker 1: I think probably we're underestimating the risk. I mean, these

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Speaker 1: are two nuclear powers. There is an unresolved dispute of

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Speaker 1: a territory which is also reflected in populist politics. I mean,

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Speaker 1: both these are democratic countries. They both rely heavily on

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Speaker 1: the Indian governments on kind of Hindu nationalism, the Pakistan

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Speaker 1: government on Muslim radicals. Um, you know, temperate temper, temper

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Speaker 1: as easily rise. I mean, we've been fortunate that they've

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Speaker 1: had some very rational statesmanlike leaders on both sides who

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Speaker 1: steered and clear of conflict. But the potential for disaster

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Speaker 1: is I'm afraid also real. But is this the retrenchment

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Speaker 1: of you know, the the superpower that is the US

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Speaker 1: is from playing a bigger role in the region. Well,

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Speaker 1: it's certainly part of it. I mean, actually, at the moment,

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Speaker 1: I think probably China has more influence in the region

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Speaker 1: because of its very big investment in Pakistan. But the

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Speaker 1: United Nation, the Artied States traditional they played a role

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Speaker 1: in both sides. They valued India because of its economic

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Speaker 1: importance and its democracy. Once upon a time, you may

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Speaker 1: remember J. K. Gab Braith was sent as now as

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Speaker 1: a symbol um. And of course on the Pakistan side,

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Speaker 1: the United States supported them for geopolitical reasons. The United

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Speaker 1: States has largely walked away. Uh. And then that's one

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Speaker 1: of the factors that I think adding to the installability

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Speaker 1: Dr Cable, as you mentioned John Kenneth Gilbert through working

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Speaker 1: with John F. Kennedy a few years ago and all

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Speaker 1: that symbolism. You attended the meetings of Endurer Gandhi and

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Speaker 1: Margaret Thatcher of another time and place, give us an update.

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Speaker 1: What is the special relationship right now of the United

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Speaker 1: Kingdom with India. Probably not as big as a lot

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Speaker 1: of British people would like to believe, of course it

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Speaker 1: is was probably part of the British Empire. We left

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Speaker 1: a big legacy, much of it good, some of it bad,

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Speaker 1: including the partition of India. Um. But the real role

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Speaker 1: that Britain plays is the fact that we now have

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Speaker 1: a substantial minority in the UK of migrants who came

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Speaker 1: here from the subcontinents some of them from Passion, from Pakistan,

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Speaker 1: many of them from Kashmir, and many Indians who came

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Speaker 1: here as well. And so in a way, but the

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Speaker 1: good and the bad of the Indian subcontinents has been

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Speaker 1: transplanted into British society. That's that is the main link

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Speaker 1: we now have. How all the world's economy and I

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Speaker 1: guess linked to that geopolitics change in the next ten years. Well,

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Speaker 1: because India is becoming a superpower and this is it

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Speaker 1: will I mean in population terms, it will overcome overtake China.

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Speaker 1: Its economy is extremely dynamic egg um and it's it's

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Speaker 1: a peculiar case I think it's a very state controlled economy,

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Speaker 1: but with a very dynamic private sector. There's this saying

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Speaker 1: that they in India the government goes to sleep at

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Speaker 1: night and the economy starts to function um and it

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Speaker 1: is growing at you know, six seven eight percent a year.

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Speaker 1: It is rapidly overtaking China. It's got a long time lag.

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Speaker 1: Within a few years time it will have probably have

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Speaker 1: the third biggest economy in the world. And I think

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Speaker 1: smart people are beginning to appreciate it's important. So Pakistan

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Speaker 1: too is is a major economic part potentially, So you know,

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Speaker 1: the Western world is underestimating. I think that the shift

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Speaker 1: in the center of gravity of the world economy, of

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Speaker 1: which India is a critical part. Vince Cable, thank you

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Speaker 1: so much for joining as of course he is the

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Speaker 1: leader of the UK Liberal Democratic Party, joining us today.

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Speaker 1: So our top story a gloomy report from the O

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Speaker 1: E c D telling you, ever think you already knew

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Speaker 1: the global economy suffering from trade tensions and political uncertainty,

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Speaker 1: clouding prospects for the future. The organization cutting the outlook

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Speaker 1: again to three point three percent for global growth from

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Speaker 1: three point five and warning there may be worse ahead.

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Speaker 1: Joining us here in New York is Alan Ruskin, Deutsche

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Speaker 1: Bank Global co head of f X Strategy. Good morning

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Speaker 1: to Allen. Morning John. How useful is a forecast from

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Speaker 1: the O E C D and let's trub in the

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Speaker 1: I M F for that matter too. Yeah. Look, these

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Speaker 1: are very big organizations that have certain advantages like big

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Speaker 1: economic models, but they're obviously not the most number in

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Speaker 1: a sense, so they can't change their forecasts and the dime,

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Speaker 1: I would argue in this particularly instance, they are really

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Speaker 1: following probably a set of market expectations and following the

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Speaker 1: data rather than necessary leading it. Well, let's talk about

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Speaker 1: the data we have had. We had a really really

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Speaker 1: hot print on the I s M in America yesterday.

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Speaker 1: Non manufacturing is SAM recovering dramatically. We're getting back to

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Speaker 1: that early story of just strength in America and weakness

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Speaker 1: our swear. Well, it does still seem to be some

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Speaker 1: sense of American exceptionism, because, however, much of the US

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Speaker 1: may be slowing, and that's obviously a question mark. However

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Speaker 1: much it is slowing, it's probably slowing less than most

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Speaker 1: other places. Um. Now, the I s M data, as

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Speaker 1: you mentioned, is truly exceptional. At the same time, you're

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Speaker 1: probably going to get some oddly week GDP data, albeit

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Speaker 1: distorted for quarter one data that could be say sub

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Speaker 1: one percent even Um. So it's gonna be interesting. It's

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Speaker 1: gonna be quite hard to read the tea leaves as

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Speaker 1: far as the data is concern. When people were reading

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Speaker 1: the Federal Reserve tea leaves and looking for the pivot

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Speaker 1: from Chairman Pal they pushed that view of patients through

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Speaker 1: the equity market is done very well. They pushed it

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Speaker 1: through credit, it's done very well. They try to push

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Speaker 1: it through foreign exchange by assuming we would get a

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Speaker 1: week a dollar we haven't had one. What's coming on, Alan, Yes,

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Speaker 1: I think that's very much a story of relativism. So

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Speaker 1: there you have to compare what's going on in in

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Speaker 1: the US versus places like the EU and and particularly Japan. Um.

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Speaker 1: What you've seen is the thought process of, well, look,

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Speaker 1: if the US is slowing and the FEDS actually not

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Speaker 1: going to be doing anything, then the ECB is not

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Speaker 1: going to be doing much either, and the ECB is

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Speaker 1: going to get locked into negative interest rates at the

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Speaker 1: peak of its interest rate cycle, which is widely seen

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Speaker 1: as diabolical. So UM it's that that's hamstringing the euro

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Speaker 1: in particular. We talked about this at length yesterday. Yesterday

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Speaker 1: was fascinating folks, between Liz Economy and a set of

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Speaker 1: interviews on China, and also what Mr Ruskin speaks of

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Speaker 1: your which is the X axis of negative interest rates.

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Speaker 1: We're pushing five years of negative German two year. That's

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Speaker 1: not in my textbooks, is it. No, we're we're well

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Speaker 1: out of the realms of textbooks unless you've been reading

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Speaker 1: the one that has been written in Japanese really for

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Speaker 1: the last twenty ideas go out in the last twenty

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Speaker 1: four US say that's what Europe faces. Perhaps Japanification. Absolutely,

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Speaker 1: it looks very very similar. Indeed, actually that there's this

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Speaker 1: sort of sense that you get locked into extremely low

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Speaker 1: interest rates. The loudest drag in Europe not Japanify. Well,

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Speaker 1: I think the first step would be to look to

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Speaker 1: fiscal policy, because oddly enough, Europe has been following relatively

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Speaker 1: austere fiscal policies, particularly in Germany, where they've been running

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Speaker 1: a surplus. So why are you running a surplus in

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Speaker 1: this particularly environment because the currency is an artificial construct, Yes,

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Speaker 1: but no, there's there's but there's politics behind it as well.

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Speaker 1: I mean, just fell off their chairs in Frankfort at

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Speaker 1: Deutsche Bank. Um, where should where should Europe be? For

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Speaker 1: Germany and you know, grab your bed, you'll be okay,

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Speaker 1: just take a guess. One fifty we can say, we

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Speaker 1: can say for the problem Europe has allen. And you

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Speaker 1: know this, there is zero consensus for countercyclical fiscal policy

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Speaker 1: in Europe. The Europeans, the South might want it, the Italians,

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Speaker 1: the Spanish for that matter too, maybe the Greeks, but

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Speaker 1: they've been forced by the North and the core of

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Speaker 1: Europe to go down a different path. Um, that's right,

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Speaker 1: and in some ways you I think John making the

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Speaker 1: argument that well, forget Japanification. In fact, Europe's in a

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Speaker 1: worse situation than Japan because it doesn't really have its leavers,

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Speaker 1: you know, can't pull the levers and policy, no policy

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Speaker 1: response whatsoever, which is why the o E c D

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Speaker 1: report is backward looking as it is. It's slightly concerning

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Speaker 1: because it raises the concern that many people have it's

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Speaker 1: a slow down in Europe, the lack of a policy response.

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Speaker 1: As we go through to the ECB meeting tomorrow, what

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Speaker 1: options do they actually have Allan Well, I think their

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Speaker 1: main option is really to roll over l t R

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Speaker 1: O two and the like, really keep the liquidity flowing there.

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Speaker 1: It that's not an exit story, really, and they have

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Speaker 1: thought they were going to be in an exit situation

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Speaker 1: at this point in time, so I think they do

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Speaker 1: have their hands tied unfortunately, and if we do see

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Speaker 1: a growth slowdown, it's inopportune and they might have missed

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Speaker 1: the boat in terms of normalize. So the thing we're

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Speaker 1: gonna hear more and more over the next coming weeks,

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Speaker 1: I assume, is the carry trade and by the US dollar.

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Speaker 1: Is that the story for you, Allen, Well, it's it's

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Speaker 1: certainly a story that we've been telling for a while,

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Speaker 1: and particularly on the carry side of things, a little

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Speaker 1: bit less so on the sort of by US dollar.

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Speaker 1: And there's been a very active debate, not only in

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Speaker 1: terms of what you want to be long in terms

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Speaker 1: of carry and let's say you just want to be

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Speaker 1: long the whole gamut of em high heeled for the

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Speaker 1: time being, at least whilst the U S stock market

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Speaker 1: is hanging in and the power put looks to be

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Speaker 1: in play, so you want the whole gamut of E

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Speaker 1: M longs, and you probably want to be financing it

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Speaker 1: with a little bit of yen, a little bit of euros,

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Speaker 1: and perhaps some dollars, but the dollar is not necessary

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Speaker 1: pewing up its hand as the obvious funding current. Can

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Speaker 1: you in focus? This is a little bit of pro

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Speaker 1: jury gonna here, but we'll go there on a on

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Speaker 1: a cold day in New York? Can you finance the

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Speaker 1: carry trade with negative interest rates? Yes? You love it?

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Speaker 1: What do you do? How do you do it? And

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Speaker 1: the forward points are even more in your favor? The

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Speaker 1: microphones over there falling off my still getting excited. I know,

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Speaker 1: how do you finance with negative interest? Can I do that?

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Speaker 1: With college tuition? You can? You can? How do you do?

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Speaker 1: The forward points are exactly reflective really of interest rates spreads,

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Speaker 1: and the forward points, whether the rates are zero or negative,

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Speaker 1: will be they're adjusted, uh, you know, and appropriate for

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Speaker 1: what that interest rate. So I go forward and like

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Speaker 1: nine years, swissy grab a negative interest rate? Yeah, and

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Speaker 1: and you know, and and historically you will find that

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Speaker 1: currentries which have these very low interest rates are expected

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Speaker 1: to appreciate over time. And if you think they're not

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Speaker 1: going to appreciate, then you can take bet in the

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Speaker 1: other direction of that. If you're driving off the road

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Speaker 1: right now, don't worry. I'm driving off the road in

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Speaker 1: the studio. So Alan Ruskin was some of the complexities

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Speaker 1: that carried there. He is with Deutsche Bank. It is

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Speaker 1: now a great pleasure to bring to you the tenth

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Speaker 1: President of the Federal Reserve Bank of New York, William Dudley,

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Speaker 1: out of Williston, out of Berkeley, where he took his

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Speaker 1: PhD in New College of Florida a few years back.

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Speaker 1: Bill Dudley has been an original economist. He wrote a

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Speaker 1: chapter for me with a wonderful at mcelvy years ago

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Speaker 1: in my book, and in that he said, there is

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Speaker 1: not a moment to lose Bill Dudley. Wonderful to have

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Speaker 1: you with us today on the FED A few other

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Speaker 1: topics as well. What is there not a moment to

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Speaker 1: lose for the markets to hook back with that policy.

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Speaker 1: The distance of the dots is substantial, isn't it. Well,

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Speaker 1: there's a quite a bit of distance between the last

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Speaker 1: summer economic projections and what the market currently thinks. I

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Speaker 1: think the key question is when the Fed says their patients,

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Speaker 1: does that mean they're done? And I think the answer

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Speaker 1: is not necessarily. I think what's gonna happen is we're

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Speaker 1: gonna have a pretty weak first quarter and that's going

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Speaker 1: to probably reinforce the idea that the SET is done.

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Speaker 1: But I think the economy is going to pick up

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Speaker 1: steam after that. Some of the issues that we're holding

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Speaker 1: the economy back, like the tightening of financial conditions that

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Speaker 1: we saw in the fourth quarter, the questions about Chinese growth,

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Speaker 1: uncertainties about trade policy. I think those things are going

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Speaker 1: to be resolved, mainly positively in the first half of

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Speaker 1: the year, So I think fit tightening maybe back on

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Speaker 1: the table in the second half of two thousand. So Bill.

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Speaker 1: Over the last couple of months, the Federal Reserve has

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Speaker 1: come under some criticism about the way it's communicated. It's

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Speaker 1: changed towards a position of patients. How does the Federal

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Speaker 1: Reserve refinance communication in the coming months to adjust and

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Speaker 1: guide the market towards the reality you to described? Well,

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Speaker 1: I think the SET is trying to get the market

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Speaker 1: to focus less on what it says about its own

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Speaker 1: projections and more about the economic outlook. The economic outlook

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Speaker 1: is what's going to drive the SET, and what what

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Speaker 1: changed in the fourth quarter was we had a lot

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Speaker 1: of new developments, financial conditions tightened growth abroad, sload, there

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Speaker 1: are uncertainties about trade policy, and inflation was very cuiescent.

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Speaker 1: The unemployer rates stopp declining even though perial growth was strong.

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Speaker 1: So there's a whole bunch of factors that pushed the

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Speaker 1: FED in the direction of being patient. Whether those factors

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Speaker 1: persist or not will determine whether in fact patients means

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Speaker 1: done well. Bill has been quite co recently to get

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Speaker 1: an understanding of the FATS reaction function, because there's been

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Speaker 1: a lot of discussion about allowing for an overshoot on

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Speaker 1: the inflation target of in and around two In your mind,

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Speaker 1: is this the fect that's willing to tolerate a bit

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Speaker 1: of an overshoot, And how does that complicate things if

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Speaker 1: you say to the market with data dependent, but the

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Speaker 1: market doesn't know how you depended on the data. Well,

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Speaker 1: I think the discussion about inflation is really a longer

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Speaker 1: term issue about do they want to move away from

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Speaker 1: their current policy, which is a bygonese policy. In other words,

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Speaker 1: if they miss inflation below two percent for a long

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Speaker 1: period time, their next move is to try to get

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Speaker 1: back to two percent, not above two percent. That's the

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Speaker 1: current policy. They're now having discussions about whether that's not

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Speaker 1: maybe that's not the right policy because that might lead

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Speaker 1: inflation expectations to decline over time. So they're thinking about

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Speaker 1: refining their their inflation objectives. But that's different. That's not

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Speaker 1: going to happen right in the very near term. They're

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Speaker 1: going on a big project over the next six to

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Speaker 1: twelve months to evaluate whether their inflation targeting regime is

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Speaker 1: the proper one. Taking the near term, it's really gonna

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Speaker 1: be about growth pressure on resources and whether that shows

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Speaker 1: up in any inflation pressure. And I think the feed

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Speaker 1: is going to be tolerant of inflation slightly above two percent.

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Speaker 1: But if they think they commun has a lot of momentum,

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Speaker 1: if they think inflation is going to keep climbing, then

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Speaker 1: they're going to start to tighten again. You're just joining

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Speaker 1: us William Dudley, a Bloomberg opinion piece. Don't assume that

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Speaker 1: the FET is done at raising rates that according to

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Speaker 1: Bill Dudley. Dr Dudley on paragraph seven, you do what

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Speaker 1: you do best, which is hide your mathematics. You talk

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Speaker 1: about threshold effects, and you also talk about inertial force.

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Speaker 1: The physics of monetary policy. Where is the inertial force

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Speaker 1: right now in our monetary policy? Well, it takes you know,

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Speaker 1: it takes a bit of information for the FED to

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Speaker 1: sort of change his mind. So we had a lot

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Speaker 1: of evidence in the fourth colore that pushed the FED

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Speaker 1: off the off the notion of continuing to tighten in

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Speaker 1: the near tray. Now it's going to take that evidence reversing,

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Speaker 1: quite a bit of reversal before the FED starts to

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Speaker 1: decide to tighten again. Uh So, you know, if you

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Speaker 1: look at the FED monrey policy through history, the FED

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Speaker 1: doesn't move erratically, don't They don't go up and then down,

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Speaker 1: up and then down. They tend to move in in

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Speaker 1: st cycles. And that's start shows you that there's thresholds

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Speaker 1: effects to get them to move in one direction or

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Speaker 1: the other. And once they start moving, it takes quite

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Speaker 1: a bit of information to get them to stop. And

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Speaker 1: once they've stopped, it takes quite a bit of information

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Speaker 1: to get them to move again. But can we just

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Speaker 1: take the opportunity to lift the lid on the decision

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Speaker 1: making process at the f O m C. Whenever we

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Speaker 1: have guests come into radio with Tom and I to

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Speaker 1: see how the sausage is made. They're always surprised by

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Speaker 1: how messy it really is, and largely because of what

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Speaker 1: Tom and I are doing behind the scenes. It's very messy. Tom,

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Speaker 1: I'm just wondering how messy it is at the f

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Speaker 1: O m C because the market is literally gripping on

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Speaker 1: every hanging on every single word you guys put out.

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Speaker 1: How to come How do you decide on the word

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Speaker 1: everyone's going to go out there and talk about patients.

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Speaker 1: Patiences are what you guys sing kumbay are patients? I

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Speaker 1: mean patients means what it says that it means I'm

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Speaker 1: going to be now to do anything. It doesn't mean

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Speaker 1: I'm done. But do you sit around the table bill

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Speaker 1: and decide that that's the words You're all going to

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Speaker 1: go out and trot around for the next month or so.

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Speaker 1: Talk me through the decision making process. How do you

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Speaker 1: guys come up with the words? These words are not

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Speaker 1: chosen lately. I mean, if you see something that's in

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Speaker 1: a speech or in a chair's press conference, those words

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Speaker 1: are very close, carefully osen. If someone is speaking extemporaneously,

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Speaker 1: then you can discount those words a little bit because

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Speaker 1: people obviously can't be point as precise when they're speaking,

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Speaker 1: when they're writing. So the words are very important, picking

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Speaker 1: those words with care and deliver and after careful deliberation.

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Speaker 1: And it's also words that are picked that you know

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Speaker 1: their socialized across the committee. I mean typically what happen

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Speaker 1: typically the the chair wants the committee to be together, right,

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Speaker 1: and so there's you know, there's gonna be some discussion

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Speaker 1: about are these kind of words the words that are

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Speaker 1: appropriate or not? Bill, I want you to weigh in

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Speaker 1: here on the raging debate and the scope of the

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Speaker 1: time that we've got left with you this morning. Modern

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Speaker 1: monetary theory. Lawrence Summer's writing in The Post on it yesterday,

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Speaker 1: Ken Rogoff writing in Project Syndicate, Paul Krugman coming out

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Speaker 1: forcefully against a theory advocated by Stephanie Kelton of Stony Brook,

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Speaker 1: and she's written this up in Bloomberg Opinion as well.

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Speaker 1: I don't want to go into a great dissertation right

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Speaker 1: now in MMT, but part of it is a belief

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Speaker 1: that the legislative branch can make a decision making or

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Speaker 1: can execute decision making on fiscal slash monetary policy in

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Speaker 1: a more efficacious way than they fed a reserve system.

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Speaker 1: Do you see any evidence of that that there can

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Speaker 1: be a better process of execution of our fiscal policy

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Speaker 1: other than from the Fed. Look, I did not subscribe

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Speaker 1: to monitor Monterey theory at all. I mean, the fact

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Speaker 1: that you issued debt in your own currency means you

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Speaker 1: can't default, that's true, But that doesn't mean you can't

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Speaker 1: have a huge hyperinflation problem. And this was tried in

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Speaker 1: that we were a republic of tried in Zimbabwe and

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Speaker 1: we had a little episode of this in the in

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Speaker 1: the nineteen sixties and nineteen seventies. This is a really

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Speaker 1: a correct pot theory in my opinion that said, could

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Speaker 1: there be better coordination of Monterrey policy and fiscal policy?

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Speaker 1: Absolutely so, if the if the FED were trapped at

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Speaker 1: the zul or bound for interest rates, it would be great.

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Speaker 1: If we had a fiscal policy at that time that

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Speaker 1: was strongly procyclical, that was actually prod support to the economy.

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Speaker 1: One thing I'd like to see is the fiscal stabilizers,

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Speaker 1: automatic fiscal stabilizer strengthened so if there is an economic downturn,

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Speaker 1: people know that the government's gonna cut fiscal you know,

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Speaker 1: east fiscal policy and that's going to stimulate the that

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Speaker 1: would help the FED do his job. So better coordination

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Speaker 1: between the fiscal side and the entrey policy side would

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Speaker 1: help the economy bill. This is so important. You and

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Speaker 1: Ed mkelvey were so far out front on concerned and

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Speaker 1: the ramifications of a growing debt or deficit. Where we

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Speaker 1: are now, according to CBO, is so much worse than

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Speaker 1: McKelvey and Dudley ever thought about. How do you reframe

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Speaker 1: There's not a moment to lose on our fiscal policy

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Speaker 1: in two thousand twenty or two thousand. Well, I think

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Speaker 1: the problem is that the markets right now are just

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Speaker 1: not worried about it. Uh. You know, even though the

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Speaker 1: deficit past is not good, that debt service costs are

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Speaker 1: going to climb very very sharply over the coming years,

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Speaker 1: the baby generations and retire and time and spending costs

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Speaker 1: are gonna go up. Markets are just not worried about it.

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Speaker 1: And so I think the problem is until markets start

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Speaker 1: to become more concerned about it, there's not gonna be

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Speaker 1: any parissure on the policy making side to do to

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Speaker 1: do anything meaningful about it. Can I get one quote

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Speaker 1: from you from Vice Chairman Clarity, He calls it a

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Speaker 1: solid American economy. Do you agree with that assessment. Yeah,

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Speaker 1: I think that I think it is. I mean, I

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Speaker 1: think the thing that strikes me is that the household

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Speaker 1: sector in particular is in very good shape. You've had

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Speaker 1: strong employment growth, you have rising wages, you have very

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Speaker 1: little increase in household debt burden, debt service costs are

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Speaker 1: the lowest they've been going back several several decades. Uh. So,

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Speaker 1: I think the household sector, which is you know, the commy,

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Speaker 1: is in really good shape. I think there's some questions

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Speaker 1: about other areas like investment, but that's probably being driven

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Speaker 1: by uncertainties about trade policy. Resolve the uncertainties about trade policy.

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Speaker 1: I think investment will bounce back. So I think the

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Speaker 1: US economy isn't quite good shape. I don't see much

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Speaker 1: prospect for a recession in the near term. Bill Dudley,

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Speaker 1: thank you so much, President of the s Bank of

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Speaker 1: New York and now with University's Center for Economic Want

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Speaker 1: Line Opinion, we have now Sarah House John I US

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Speaker 1: now West Farga Security senior economists. Great to have you

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Speaker 1: with Sarah. So we caught up with the former New

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Speaker 1: York Fed President William Dudley Bill said, don't assume the

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Speaker 1: fattest done rising rights. Do you agree with that, Sarah,

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Speaker 1: I do agree with that. So we currently expect the

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Speaker 1: Fed to go ahead and move again in the third

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Speaker 1: quarter for many of the reasons that that Dudley laid out. So, UM,

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Speaker 1: we look at the overall reason for the FEDS pause. So,

429
00:23:43,440 --> 00:23:46,040
Speaker 1: of course we've seen global growth slow down. UM, we've

430
00:23:46,040 --> 00:23:48,080
Speaker 1: seen a lot of concerns about the trade war. I

431
00:23:48,119 --> 00:23:51,760
Speaker 1: think the shutdown uncertainty had some had some play in

432
00:23:51,800 --> 00:23:55,600
Speaker 1: this too, and of course the tightening in financial conditions. Well,

433
00:23:55,680 --> 00:23:58,560
Speaker 1: we're still seeing some concerns about about the global slowdown,

434
00:23:58,600 --> 00:24:01,399
Speaker 1: so I don't think that's likely to go away that soon.

435
00:24:01,600 --> 00:24:03,600
Speaker 1: But UM, it looks like we'll get some sort of

436
00:24:03,640 --> 00:24:07,200
Speaker 1: resolution on on the trade war. UM. Shutdown has been resolved,

437
00:24:07,240 --> 00:24:10,960
Speaker 1: We've already seen some indicators like consumer confidence back bounce back,

438
00:24:11,280 --> 00:24:14,480
Speaker 1: and of course financial conditions have have reversed. In fact,

439
00:24:14,520 --> 00:24:17,080
Speaker 1: if you look at the Bloomberg Financial Conditions Index, they're

440
00:24:17,080 --> 00:24:20,520
Speaker 1: actually the easiest they've been since last October. So UM,

441
00:24:20,560 --> 00:24:22,960
Speaker 1: we think that that growth will bounce back UM in

442
00:24:23,080 --> 00:24:25,879
Speaker 1: the second quarter, and that will give the FED the

443
00:24:25,920 --> 00:24:29,160
Speaker 1: green light to go ahead and move. In Q three, Sarah,

444
00:24:29,320 --> 00:24:31,880
Speaker 1: let me ask you this a question I asked Mr Dudley.

445
00:24:32,240 --> 00:24:34,919
Speaker 1: The Federals says they are data dependent. Do you have

446
00:24:35,119 --> 00:24:37,920
Speaker 1: a clear, a really strong understanding of how they are

447
00:24:38,000 --> 00:24:42,040
Speaker 1: dependent on the data. So I think you know they're

448
00:24:42,080 --> 00:24:44,439
Speaker 1: they're looking at a mix. Obviously, it's not just just

449
00:24:44,560 --> 00:24:47,640
Speaker 1: one one or two indicators. Um, you know they're they're

450
00:24:47,640 --> 00:24:50,520
Speaker 1: giving I think a lot of weight or um at

451
00:24:50,600 --> 00:24:53,679
Speaker 1: least we think they'll be giving weight towards the employment

452
00:24:53,760 --> 00:24:57,080
Speaker 1: and inflation measures. So we expect inflation to pick up

453
00:24:57,119 --> 00:24:59,159
Speaker 1: a little bit from from where it is here. So

454
00:24:59,359 --> 00:25:01,399
Speaker 1: not not at a point where we'd really have to

455
00:25:01,400 --> 00:25:04,159
Speaker 1: see the said ratchet up the pace of tightening, but

456
00:25:04,160 --> 00:25:06,600
Speaker 1: we think inflation is going to hold firm a core

457
00:25:06,640 --> 00:25:10,159
Speaker 1: inflation roughly two percent, maybe even a couple of tents

458
00:25:10,200 --> 00:25:12,960
Speaker 1: over that by by the end of the year. And

459
00:25:13,240 --> 00:25:16,399
Speaker 1: you know, the employment data continues continues to look strong,

460
00:25:16,520 --> 00:25:20,840
Speaker 1: and so um, just considering the continued solid momentum that

461
00:25:20,880 --> 00:25:23,359
Speaker 1: we see there. Um, given that those are are the

462
00:25:23,400 --> 00:25:26,080
Speaker 1: primary focal points of the said, we think that that's

463
00:25:26,119 --> 00:25:28,920
Speaker 1: going going to give them again that that green light

464
00:25:28,960 --> 00:25:32,680
Speaker 1: to go ahead and move, but clearly they've been watching

465
00:25:32,760 --> 00:25:37,080
Speaker 1: more um more more areas than than they have in

466
00:25:37,119 --> 00:25:40,960
Speaker 1: the past and incorporating those those moves and financial conditions well, Sarah,

467
00:25:40,960 --> 00:25:43,280
Speaker 1: Seemingly it seems to be financial conditions that is becoming

468
00:25:43,320 --> 00:25:45,840
Speaker 1: increasingly important because we just had one of the strongest

469
00:25:45,840 --> 00:25:49,080
Speaker 1: prints for this cycle of the non manufacturing is m

470
00:25:49,119 --> 00:25:51,960
Speaker 1: just yesterday. The US economy, going by the data, still

471
00:25:51,960 --> 00:25:54,200
Speaker 1: looks pretty strong, Sarah. Yet the only thing that's really

472
00:25:54,280 --> 00:25:57,160
Speaker 1: changed radically of the last six months was the price

473
00:25:57,200 --> 00:26:00,440
Speaker 1: section in markets, So let's talk about that. Increasingly, financial

474
00:26:00,440 --> 00:26:02,639
Speaker 1: markets and financial conditions seem to be a much much

475
00:26:02,640 --> 00:26:05,680
Speaker 1: bigger isshic for this Federal Reserve than just the economic

476
00:26:05,760 --> 00:26:08,440
Speaker 1: day to an isolation, Why is that, Sarah, Well, I

477
00:26:08,480 --> 00:26:11,000
Speaker 1: think it's it's where we are in the cycle. So

478
00:26:11,200 --> 00:26:13,840
Speaker 1: it's it's the fact that you know, we're we're getting

479
00:26:13,880 --> 00:26:16,520
Speaker 1: to a point where policy is roughly neutral, so we

480
00:26:16,520 --> 00:26:19,359
Speaker 1: would expect to see what the Fed is doing have

481
00:26:19,840 --> 00:26:23,480
Speaker 1: a bigger impact on on financial market. Um. The issue

482
00:26:23,600 --> 00:26:25,240
Speaker 1: is that you know, there's there's a little bit of

483
00:26:25,280 --> 00:26:28,680
Speaker 1: a little bit of a push poll, so financial conditions tighten,

484
00:26:28,800 --> 00:26:31,720
Speaker 1: the FED gets easier, financial conditions ease, well, then the

485
00:26:31,760 --> 00:26:34,679
Speaker 1: FED can be um, perhaps a little bit more more aggressive.

486
00:26:34,840 --> 00:26:37,840
Speaker 1: So I think that implies that we would get perhaps

487
00:26:37,840 --> 00:26:39,880
Speaker 1: more volatility is as we see kind of that back

488
00:26:39,920 --> 00:26:42,919
Speaker 1: and forth between FED language and the market reactions. So

489
00:26:42,960 --> 00:26:44,919
Speaker 1: what as well as Fargo's see, is the state of

490
00:26:44,960 --> 00:26:47,280
Speaker 1: the consumer in the United States. I mean, what's the

491
00:26:47,320 --> 00:26:52,080
Speaker 1: granularity you're crunching through every day? Yeah, so the consumer

492
00:26:52,160 --> 00:26:55,280
Speaker 1: is really the strong point. I mean, look at Coles yesterday.

493
00:26:55,320 --> 00:26:57,639
Speaker 1: I mean this is completely separate served from you. But

494
00:26:57,720 --> 00:27:00,400
Speaker 1: who would have thought that a midline departments or would

495
00:27:00,400 --> 00:27:03,800
Speaker 1: have done as well as calls did? They did really well, right,

496
00:27:03,840 --> 00:27:07,000
Speaker 1: And that's what's really underpinning our our forecast for another

497
00:27:07,080 --> 00:27:11,080
Speaker 1: year of above potential growth and is the strength of

498
00:27:11,160 --> 00:27:14,960
Speaker 1: the consumer. So we're seeing pretty strong income growth, so

499
00:27:15,080 --> 00:27:18,280
Speaker 1: especially when you look at at the labor income UM,

500
00:27:18,280 --> 00:27:20,400
Speaker 1: so the fact that we have seen such strong job

501
00:27:20,440 --> 00:27:23,760
Speaker 1: growth rising wages, and that's really filtering through, I think

502
00:27:23,840 --> 00:27:27,960
Speaker 1: towards more of those middle and lower income consumers. So UM,

503
00:27:28,000 --> 00:27:30,280
Speaker 1: the wage growth has actually been the strongest at the

504
00:27:30,280 --> 00:27:32,879
Speaker 1: lowest end, and I think that is supporting UM. So

505
00:27:33,119 --> 00:27:35,360
Speaker 1: you know some of these you know, maybe more more

506
00:27:35,400 --> 00:27:38,040
Speaker 1: middle middle tier companies. So, Sarah, how long before the

507
00:27:38,080 --> 00:27:40,200
Speaker 1: hawks at the f m C stop making some noising

508
00:27:40,280 --> 00:27:43,360
Speaker 1: and listen to you? There you go creating a trend.

509
00:27:44,720 --> 00:27:47,000
Speaker 1: I I think, I think there's still sometimes so even

510
00:27:47,080 --> 00:27:49,440
Speaker 1: as we see a core inflation picking up to about

511
00:27:49,480 --> 00:27:51,840
Speaker 1: two point two percent by by the end of the year,

512
00:27:52,080 --> 00:27:54,639
Speaker 1: that's really not a threat to to the FED, and

513
00:27:54,840 --> 00:27:56,879
Speaker 1: especially I think as they are coming around to the

514
00:27:56,920 --> 00:27:59,800
Speaker 1: fact that they can let an inflation drift a little

515
00:27:59,800 --> 00:28:02,720
Speaker 1: bit above above two percent. So of course the target

516
00:28:02,800 --> 00:28:06,240
Speaker 1: is still formerly two as as Bill Dudley was was

517
00:28:06,280 --> 00:28:08,680
Speaker 1: just talking about with with you guys. But I think

518
00:28:08,920 --> 00:28:12,000
Speaker 1: the FEDS getting increasingly comfortable with a little bit of

519
00:28:12,040 --> 00:28:15,320
Speaker 1: an overshoot. So I think I think the hawks will

520
00:28:15,440 --> 00:28:19,240
Speaker 1: will be pretty quiet. Senta House, great to catch up

521
00:28:19,240 --> 00:28:22,960
Speaker 1: with you whilst FAGA security as we count you down

522
00:28:22,960 --> 00:28:41,160
Speaker 1: to pay rolls Friday. I don't know if you're worried

523
00:28:41,200 --> 00:28:44,080
Speaker 1: about your portfolio. You've got company that would be the

524
00:28:44,080 --> 00:28:47,920
Speaker 1: President of the United States. He likes stocks up. Slam

525
00:28:47,960 --> 00:28:51,800
Speaker 1: Molson is with Bloomberg in Washington, where she looks at

526
00:28:52,000 --> 00:28:55,560
Speaker 1: Treasury affairs and White House affairs, and the distance from

527
00:28:55,960 --> 00:28:57,760
Speaker 1: Treasure to White house. How long is it like a

528
00:28:57,760 --> 00:29:02,560
Speaker 1: football fieldsy it is maybe twenty steps, like if Minutia

529
00:29:02,600 --> 00:29:04,840
Speaker 1: wants to go over and see the presidency go underground

530
00:29:04,920 --> 00:29:07,760
Speaker 1: kind of things, not underground, but it's it's fifteen twenty

531
00:29:07,800 --> 00:29:10,680
Speaker 1: steps the way. That's the way it's always been with

532
00:29:10,760 --> 00:29:14,520
Speaker 1: the Gallatin statue out front. And so you and Jennifer

533
00:29:14,600 --> 00:29:18,360
Speaker 1: Jacobs written up a linkage here of a trade discussion

534
00:29:18,840 --> 00:29:21,680
Speaker 1: with the stock market. Now to back up, we didn't

535
00:29:21,800 --> 00:29:26,160
Speaker 1: have a hannoy North Korea discussion with the stock market,

536
00:29:26,200 --> 00:29:29,560
Speaker 1: did we? No, we didn't. But since the fourth quarter

537
00:29:29,560 --> 00:29:32,320
Speaker 1: of last year, investors have really taken note that these

538
00:29:32,360 --> 00:29:35,120
Speaker 1: tariffs are actually happening. I think they realize that the

539
00:29:35,160 --> 00:29:38,160
Speaker 1: threats are real, that the tariffs are real, the tip

540
00:29:38,320 --> 00:29:41,400
Speaker 1: for tat port side of this trade war is real,

541
00:29:41,800 --> 00:29:44,080
Speaker 1: and so investors are reacting to a number of things,

542
00:29:44,160 --> 00:29:47,840
Speaker 1: including having this concern around the uncertainty of the trade war.

543
00:29:47,920 --> 00:29:51,040
Speaker 1: So stock markets are down. One research study show that

544
00:29:51,200 --> 00:29:53,760
Speaker 1: stock markets are twelve percent lower than they would have

545
00:29:53,800 --> 00:29:57,800
Speaker 1: been without the tip for tat tariffs between cane that study,

546
00:29:57,840 --> 00:29:59,800
Speaker 1: that's really interesting, not off the top of my head,

547
00:29:59,800 --> 00:30:03,720
Speaker 1: but that's good. That's a surveillance tradition. I really don't

548
00:30:03,720 --> 00:30:05,640
Speaker 1: know where I read that, but I read it somewhere.

549
00:30:05,640 --> 00:30:07,920
Speaker 1: It's okay, we do that. We don't do that in Washington,

550
00:30:08,000 --> 00:30:11,000
Speaker 1: we do that in New York, New York. Thank you. Um.

551
00:30:11,600 --> 00:30:13,760
Speaker 1: When you look at the president's believe the stock market,

552
00:30:13,800 --> 00:30:16,800
Speaker 1: which I think has been widely chronicled, how's he tied

553
00:30:16,840 --> 00:30:20,360
Speaker 1: into agriculture terroffts? I mean, am I right? The reporting

554
00:30:20,480 --> 00:30:23,400
Speaker 1: is agriculture America is flat on its back? Is that?

555
00:30:23,720 --> 00:30:26,760
Speaker 1: I mean bankruptcies in the in Middle America, in the

556
00:30:26,760 --> 00:30:31,080
Speaker 1: Red States, you know, Wisconsin, Illinois, Indiana, bankruptcies amongst farmers

557
00:30:31,080 --> 00:30:35,000
Speaker 1: are the highest or higher than who When the cabinet

558
00:30:35,040 --> 00:30:37,800
Speaker 1: cares about that, I know the President cares about that.

559
00:30:37,840 --> 00:30:40,120
Speaker 1: I'm just going to guess there and say, yes, does

560
00:30:40,160 --> 00:30:43,240
Speaker 1: the Secretary Commerce care about that? Does the Secretary of

561
00:30:43,320 --> 00:30:45,640
Speaker 1: Treasury care about that? I hope they do because that

562
00:30:45,680 --> 00:30:48,680
Speaker 1: feeds into the economic agenda that they themselves are helping

563
00:30:49,040 --> 00:30:52,560
Speaker 1: Trump achieve under this administration. Is there any discussion of

564
00:30:52,800 --> 00:30:55,520
Speaker 1: a lessoning of tariffs or an elimination of them and

565
00:30:55,840 --> 00:30:58,360
Speaker 1: start all over. There is definitely a talk of a

566
00:30:58,480 --> 00:31:01,800
Speaker 1: lessoning of tariffs. A d escalation is what markets want.

567
00:31:02,160 --> 00:31:05,160
Speaker 1: A de escalation it was, is what China wants. Uh,

568
00:31:05,200 --> 00:31:07,600
Speaker 1: there is talk of that tariff so far seen the

569
00:31:07,600 --> 00:31:10,560
Speaker 1: most obvious enforcement mechanism for any kind of a deal,

570
00:31:11,000 --> 00:31:12,960
Speaker 1: but it remains to be seen. I mean, the delay,

571
00:31:13,120 --> 00:31:15,400
Speaker 1: the ones from this past Friday that we're supposed to

572
00:31:15,440 --> 00:31:17,360
Speaker 1: go into effect for delayed. So we already have a

573
00:31:17,360 --> 00:31:19,400
Speaker 1: little bit of a de escalation. But but that bar

574
00:31:19,520 --> 00:31:21,840
Speaker 1: that's down the street from our office in Washington, I've

575
00:31:21,840 --> 00:31:24,240
Speaker 1: seen you in there a couple of times. Save face.

576
00:31:24,520 --> 00:31:28,120
Speaker 1: It's a great bar. Everybody in Washington has to save face. Right,

577
00:31:28,360 --> 00:31:31,400
Speaker 1: How do we save face if we de escalate tariffs?

578
00:31:31,600 --> 00:31:34,480
Speaker 1: It depends on what China offers. I think a lot

579
00:31:34,520 --> 00:31:36,520
Speaker 1: of it is just going to be optics. How President

580
00:31:36,640 --> 00:31:40,440
Speaker 1: the standing next to China's and mar Lago where two

581
00:31:40,520 --> 00:31:44,120
Speaker 1: years ago they stood and had their first honyone meeting.

582
00:31:44,520 --> 00:31:48,040
Speaker 1: It's the optics they want. President Trump wants a meeting

583
00:31:48,040 --> 00:31:53,440
Speaker 1: at mar Lago assigning agreement. Question why Lago? That is

584
00:31:53,480 --> 00:31:58,440
Speaker 1: the White House of the South. Okay, but can't China

585
00:31:58,560 --> 00:32:03,000
Speaker 1: say no, we wanted to ampan Canada. Jackson also likes

586
00:32:03,040 --> 00:32:04,880
Speaker 1: the photo op I mean, remember the sn e d

587
00:32:05,040 --> 00:32:08,760
Speaker 1: the whole The highlight for China during this Hank Paulson

588
00:32:08,920 --> 00:32:13,480
Speaker 1: created dialogue between the US and China was the photo op. Okay,

589
00:32:13,520 --> 00:32:16,960
Speaker 1: we did like four or five interviews yesterday in China

590
00:32:17,160 --> 00:32:20,240
Speaker 1: and they were fascinating. Elizabeth Economy at the consolet Foreign

591
00:32:20,280 --> 00:32:23,560
Speaker 1: Relations really talked about the saving face going on in

592
00:32:23,720 --> 00:32:28,800
Speaker 1: domestic China. From where you sit in Washington, Uh, Sleigh

593
00:32:28,840 --> 00:32:31,400
Speaker 1: a motion with us right now out of our Washington

594
00:32:31,440 --> 00:32:34,200
Speaker 1: News Beer on her story on Trump stock market and trade.

595
00:32:34,800 --> 00:32:38,360
Speaker 1: Is this discussion changing because of the way the US

596
00:32:38,560 --> 00:32:43,360
Speaker 1: perceives the fragile dynamics president she has in China. Trump

597
00:32:43,440 --> 00:32:47,920
Speaker 1: has repeatedly commented on the strong position that the US

598
00:32:48,040 --> 00:32:51,520
Speaker 1: is in considering how China's economy is slowing and what

599
00:32:51,640 --> 00:32:56,240
Speaker 1: is going on in China like internal domestic politics. But

600
00:32:56,400 --> 00:32:59,000
Speaker 1: if he wants a deal, he's also getting pressured. I

601
00:32:59,000 --> 00:33:01,440
Speaker 1: mean it is a bi part, isn't concern now? Chuck

602
00:33:01,480 --> 00:33:04,040
Speaker 1: Schumer says the best thing Trump has ever done is

603
00:33:04,080 --> 00:33:07,080
Speaker 1: go tough on China. Trump doesn't want to lose face

604
00:33:07,160 --> 00:33:11,080
Speaker 1: before Chuck Schumer either. On the one thing, we're back

605
00:33:11,120 --> 00:33:17,120
Speaker 1: to save face. That's all anybody from Washington safe, but

606
00:33:17,120 --> 00:33:20,000
Speaker 1: but silly, We're gonna go to Mara Lago. I mean,

607
00:33:20,600 --> 00:33:22,520
Speaker 1: think about Hannoy. I was in here at two am.

608
00:33:22,560 --> 00:33:25,800
Speaker 1: I listened to the press conference the reversal in Hannoi

609
00:33:25,840 --> 00:33:29,040
Speaker 1: in I'll say, fourteen hours plus the minus a couple

610
00:33:29,040 --> 00:33:31,600
Speaker 1: of hours. Are we going to get the same thing

611
00:33:31,880 --> 00:33:35,600
Speaker 1: in your world of China and trade? It is absolutely possible.

612
00:33:35,640 --> 00:33:38,680
Speaker 1: This is what happens when there's one to one diplomacy.

613
00:33:38,760 --> 00:33:41,880
Speaker 1: That's what we saw with North Korea. It all comes

614
00:33:41,920 --> 00:33:44,080
Speaker 1: Trump has said, and his aids have said over and

615
00:33:44,160 --> 00:33:47,680
Speaker 1: over to me, uh behind closed doors. They've said it

616
00:33:47,720 --> 00:33:50,600
Speaker 1: to the world on camera and in press conferences that

617
00:33:50,680 --> 00:33:54,600
Speaker 1: it all depends on what Trump and President and China's

618
00:33:54,640 --> 00:33:56,840
Speaker 1: g decide when they are So you're telling this is

619
00:33:56,840 --> 00:34:00,160
Speaker 1: critical now, you're telling me when you're reporting just we

620
00:34:00,200 --> 00:34:02,520
Speaker 1: saw in that White House meeting X number of days ago.

621
00:34:03,040 --> 00:34:05,360
Speaker 1: Were you in the Oval office during the Lightheiser meeting?

622
00:34:05,680 --> 00:34:08,440
Speaker 1: The light Okay, maybe Kevin was there, I can't remember

623
00:34:08,680 --> 00:34:12,000
Speaker 1: the Lightheiser dressed down. I'm going to call it. You know,

624
00:34:12,560 --> 00:34:16,080
Speaker 1: is that still in effect where the president's ad hocking

625
00:34:16,640 --> 00:34:21,680
Speaker 1: absolutely ad hoc administration. Now there is a always a chance.

626
00:34:21,719 --> 00:34:24,160
Speaker 1: Pompeo said this last week in an interview earlier this week,

627
00:34:24,239 --> 00:34:27,080
Speaker 1: I can't keep your secretary state. Yeah, Secretary of State,

628
00:34:27,120 --> 00:34:30,000
Speaker 1: Pompeo said, it is possible that Trump walks away like

629
00:34:30,040 --> 00:34:32,400
Speaker 1: you did with North Korea, he walks away with China.

630
00:34:32,440 --> 00:34:36,560
Speaker 1: But the difference is that Trump really wants to an

631
00:34:36,560 --> 00:34:40,239
Speaker 1: equities rally from a China deal. He has noticed that

632
00:34:40,320 --> 00:34:43,279
Speaker 1: every time he tweets, every time Minutian or someone goes

633
00:34:43,320 --> 00:34:48,000
Speaker 1: out there and talks positively about China investors. Yes, and

634
00:34:48,040 --> 00:34:50,920
Speaker 1: so when someone walks into the Oval Office, when top

635
00:34:51,000 --> 00:34:53,400
Speaker 1: White House people walk into the Oval Office, they know

636
00:34:53,520 --> 00:34:55,719
Speaker 1: you better know how the stock markets are doing right

637
00:34:55,760 --> 00:34:58,320
Speaker 1: now because President the President is gonna ask if trade

638
00:34:58,400 --> 00:35:02,200
Speaker 1: falls apart, even if we save face, this is the

639
00:35:02,239 --> 00:35:06,359
Speaker 1: safe face interview. Can sheriffs go down? Where we go?

640
00:35:06,480 --> 00:35:08,360
Speaker 1: We really made no decision. We're going to kick the

641
00:35:08,400 --> 00:35:11,759
Speaker 1: trade can down the road. But to our listeners in

642
00:35:11,800 --> 00:35:15,160
Speaker 1: the Midwest, do they cut tariffs as they wait for

643
00:35:15,200 --> 00:35:17,719
Speaker 1: the can to move down the road. Yeah, it's absolutely

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Speaker 1: almost like a two part Yeah, anything is possible. There's

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Speaker 1: a giant gray area. This is what I've been up

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Speaker 1: here in New York, trying to explain to investors that

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Speaker 1: I've been talking to that you know, in markets have

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Speaker 1: made a very binary choice of either it's gonna be

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Speaker 1: a good deal or a bad deal. But there is

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Speaker 1: a vast gray area tick that the president could that

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Speaker 1: China could exploit here. But within this discussion there has

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Speaker 1: to be a timeline. Do you do your secretary minution

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Speaker 1: have a timeline if he has when he hasn't told me.

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Speaker 1: All we know is that there's a hundred fifty pages document.

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Speaker 1: But a hundred and fifty page document, that's a that

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Speaker 1: would be fabulous. No, it's something sort of a deal

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Speaker 1: making the m o U s and we're not going

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Speaker 1: to call them. It's according to minutia. The last time

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Speaker 1: we heard about some big document, there was nothing. This

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Speaker 1: is critical. The summary of your reporting is, we don't

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Speaker 1: know exactly, and it's been so much fun to report that.

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Speaker 1: This is brilliant. Come back to New York more often.

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Speaker 1: Salmon with us is well writing in Bloomberg Today with

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Speaker 1: Jennifer Jacobs. It's a really interesting story, an immediate story

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Speaker 1: about the President and said to push for China deal

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Speaker 1: with market gains. In my we of course speak to

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Speaker 1: Slea in uh Washington a FM, and her studios at

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Speaker 1: her news bureau in Washington. Thanks for listening to the

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Speaker 1: Bloomberg Surveillance podcast. Subscribe and listen to interviews on Apple Podcasts, SoundCloud,

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00:36:52,160 --> 00:36:56,399
Speaker 1: or whichever podcast platform you prefer. I'm on Twitter at

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Speaker 1: Tom Keane before the podcast. You can always catch us worldwide.

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Speaker 1: I'm Bloomberg Radio